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MORGAN STANLEY REAL ESTATE FUND ACQUIRES RED ROOF INNS FOR $600 MILLION

 NEW YORK, Nov. 17 /PRNewswire/ -- Morgan Stanley Real Estate Fund, L.P. and Red Roof Inns, Inc. today announced that the Fund will acquire Red Roof Inns effective Dec. 17, 1993, for a total purchase price of approximately $600 million. The 210-unit economy motel chain is currently owned by a private trust created by the late James R. Trueman.
 Since it was founded in 1972 by Mr. Trueman, Red Roof has been a proven performer in the limited service hotel market. The limited service market has historically shown the highest overall occupancies and growth in room demand in the hotel industry.
 "Red Roof Inns is a well known brand name with a loyal clientele," said Paul D. Kazilionis, managing director of Morgan Stanley and president of the Morgan Stanley Real Estate Fund. "The acquisition fits with our strategy of identifying and acquiring attractive real estate opportunities along with their successful existing managements."
 Jack Van Fossen, president and chief executive officer of Red Roof Inns, will remain in his current positions. Barbara Trueman, chairman, will retire to devote more time to other family business interests. Red Roof's headquarters will remain in Hilliard, Ohio, a suburb of Columbus.
 "We represent a solid, profitable investment for the Morgan Stanley Real Estate Fund," said Mr. Van Fossen. "Because Red Roof owns 100 percent of its motel properties, we and our over 5,000 dedicated employees have been able to deliver a consistent and reliable level of quality service to our customers." Mr. Van Fossen noted that no major changes in day-to-day management or operations were planned, and that the chain would soon focus on strategic expansion in current and potential new markets.
 The Morgan Stanley Real Estate Fund, L.P. is an $840 million equity fund managed by a subsidiary of Morgan Stanley Group Inc. (NYSE: MS). Since it was founded in 1991, the Fund has been one of the most significant private equity pools targeting investments in real estate with acquisitions to date representing total capitalization in excess of $2 billion. Investments include the Kearny Street portfolio acquired from BankAmerica, the AmeriFirst portfolio, Carmel Valley Ranch and Telluride Resort & Inn. Morgan Stanley is a global financial services firm with offices in New York, London, Tokyo and other principal financial centers around the world.
 -0- 11/17/93
 /CONTACT: Mary Stubbs of Morgan Stanley, 212-703-6804, or Beth Shannon of Red Roof Inns, Inc., 614-876-3417/
 (MS)


CO: Morgan Stanley Real Estate Fund, L.P.; Red Roof Inns, Inc. ST: New York, Ohio IN: FIN LEI SU: TNM

MK -- PH007 -- 5343 11/17/93 09:53 EST
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Publication:PR Newswire
Date:Nov 17, 1993
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