BridgeStreet Accommodations, Inc. Announces 111% Growth in Fourth Quarter Earnings.

CLEVELAND--(BUSINESS WIRE)--Feb. 17, 1999--BridgeStreet Accommodations, Inc. (AMEX:BDS), today announced net income of $489,000 or $0.06 per share for the fourth quarter ended December 31, 1998. The fourth quarter net income was up 111% over the comparable prior year period's results of $231,000, revenues increased 80% from $13.8 million to $24.8 million.

For the year ended December 31, 1998, the company's net income adjusted for a one-time restructuring charge was $2,190,000 up 32% over the comparable prior year period's results of $1,664,000 (excluding a non-recurring officers' stock compensation charge), revenues increased 90% from $50.7 million to $96.4 million.

John E. Danneberg, President and Chief Executive Officer of the Company stated: "We continue to see significant improvement in the local market management of our operations, specifically in managing our apartment inventory. This translated into a doubling of our bottom line profitability in the fourth quarter. As we look toward 1999, our primary focus is to drive revenue growth through new market expansion, marketing alliances, selective acquisitions and by aggressively investing in our Internet Website. During the fourth quarter of 1998, Web related sales accounted for close to $500,000. This is a fraction of the market potential. We plan to better saturate the Web with information about BridgeStreet. A common comment from many of our new customers is that `we are the best kept secret in lodging.' We will be enhancing our Website in areas that respond to our customers' demands -- to provide greater access to information, more interactivity and more choices." Mr. Danneberg went on to say, "Our information technology investments, both in the operational and Internet areas, strategically position us to gain market share in the lodging industry. The temporary housing marketplace continues to grow and evolve with market awareness. We are being recognized by the consumer as a better price/value lodging alternative."

BridgeStreet offers upscale, fully furnished apartments, townhouses and condominiums primarily for business travelers and relocating corporate executives who need lodging for one night up to several months or more. A typical unit is considerably larger and its cost per night considerably lower than traditional and extended-stay hotels. The company's diverse customer base centers on Fortune 2000 corporations, professional firms and travel-wise individuals.

BridgeStreet's toll-free number is 1-800-B-STREET for calls from the U.S. or Canada. Feel free to visit our Website at www.bridgestreet.com .

This release contains forward-looking statements which involve risks and uncertainties. The company's actual results may differ significantly from results discussed in the forward-looking statements due to a number of important factors, including, but not limited to, the company's planned rapid expansion, risks related to acquisition financing, dependence on third parties, market acceptance of the company's brand name, and factors affecting travel. These factors are more fully discussed in the company's Registration Statement on Form S-4 filed with the Securities and Exchange Commission (File No. 333-39187).

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                   BRIDGESTREET ACCOMMODATIONS,INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                 (In thousands, except share amounts)

                          Three Months Ended     Twelve Months Ended
                              December 31,           December 31,
                       ----------------------  -----------------------
                           1997         1998        1997       1998
                       ----------  ----------  ----------  -----------
Revenues               $   13,836  $   24,845  $   50,750  $   96,409

Operating Expenses:
  Cost of services         10,999      18,676      37,737      71,310
  Selling, general
   and administrative
   expense                  2,542       4,916       9,887      20,026
  Goodwill amortization
   expense                    131         297         489       1,098
  Officers' stock
   compensation expense
   (note 1)                  --          --         1,210        --
  Management restructuring
   (note 2)                  --          --          --         1,330
                       ----------  ----------  ----------  ----------
     Total operating
      expenses             13,672      23,889      49,323      93,764
                       ----------  ----------  ----------  ----------

     Operating income         164         956       1,427       2,645

     Other income             266           6         398          81
                       ----------  ----------  ----------  ----------
  Income before
   provision for
   income taxes               430         962       1,825       2,726
  Provision for
   income taxes
   (note 3)                   199         473       1,371       1,267
                       ----------  ----------  ----------  ----------
  Net income           $      231  $      489         454  $    1,459
                       ----------  ----------  ----------  ----------
                       ----------  ----------  ----------  ----------

  Net income per
   share before
   officers' stock
   compensation expense
   and management
   restructuring
   expense             $     0.03  $     0.06  $     0.28  $     0.27
                       ----------  ----------  ----------  ----------
                       ----------  ----------  ----------  ----------

  Basic and dilutive
   net income per
   share               $     0.03  $     0.06  $     0.08  $     0.18
                       ----------  ----------  ----------  ----------
                       ----------  ----------  ----------  ----------

  Weighted average
   shares outstanding
   -basic               7,620,862   8,169,835   5,904,484   8,123,306

  Weighted average
   shares outstanding
   -dilutive            7,741,522   8,169,835   5,930,248   8,123,306

Note 1. Officers' stock compensation expense represents a
non-recurring, non-cash compensation expense which was charged to
operations, with an offsetting credit to paid in capital, in the first
quarter of 1997. The charge represents the difference between the
value of the stock issued and the amount paid by the officers.

Note 2. Management restructuring charge represents a non-recurring
charge for expenses associated with a senior management realignment.

Note 3. The income tax provision for the year ended December 31, 1997
does not give tax benefit for officers' stock compensation expense.
The income tax provision for the years ended December 31, 1998 and
1997 do not give tax benefit for non-deductible goodwill amortization
expense.