EXTENDED-STAY HOTEL CHAINS ARE STEERING CLEAR OF COUNTY

A "Please Do Not Disturb" sign couldn't have worked better.

Gwinnett County was averaging four new extended-stay hotels a year until
new restrictions were put on the books in 1999.

Since then, no chain has opened one of the lodges known for their in-room
kitchens, according to Smith Travel Research, a Hendersonville, Tenn., firm
that tracks the lodging industry.

The county and towns along I-85 clamped down on the hotels after police
complained that some had become magnets for drug dealers and prostitutes.

The hotels, which charge rates as low as $160 a week, were "turning into
something we don't want," said Wayne Hill, chairman of the Gwinnett County
Commission. "What we want is quality."

Under county rules passed in 1999, hotel rooms must open to interior
hallways, be no smaller than 350 square feet and sit on lots larger than 2
acres. And Gwinnett officials have made it clear that they are ready to
tack on additional limits.

Last month, they prohibited in-room dishwashers and stovetops for a
proposed Homewood Suites on Sugarloaf Parkway. The restriction means the
Hilton chain is unlikely to attach its extended-stay label to the project,
developer Ray Thakkar said.

County Commissioner Marcia Neaton-Griggs said the county is being vigilant
when rezoning property, even when the pitch is for a high-end hotel geared
toward executives.

"He can swear to me all day long that it's going to be a Hilton," she said.
"Then somebody else comes in and builds a not-so-high-level extended-stay
hotel, and then you've got a problem."

Cobb County and Marietta also have restrictions on extended-stay hotels,
said Jim Anhut, senior vice president of StayBridge Suites by Holiday Inn.

But they are the exceptions, said Anhut, who heads the American Hotel and
Lodging Association's Extended Stay Council, created partly in response to
the concerns in Gwinnett and Cobb. "You haven't seen that same phenomenon
in other marketplaces," he said.

Metro Atlanta leads the nation with 10,870 extended-stay hotel rooms,
according to Smith Travel. The area, a popular test market because of its
diverse and fast-growing population, easily outdistances second-place
Houston, which is followed by Dallas and Washington.

From blue-collar construction crews to open-collar computer technicians,
more and more traveling workers are using extended-stay rooms nationwide.
They can save money by cooking their own meals. And the low room rates
cover inhouse laundry facilities rather than pools and restaurants common
at most inns.

Demand for extended-stay hotels rose 3.5 percent in the first half of 2001,
compared with the same period in 2000. The figure for the overall hotel
industry was 0.1 percent, according to Smith Travel. And the occupancy rate
at extended-stay hotels is more than 10 percent higher than conventional
lodges.

Industry analysts say Gwinnett's extended-stay drought comes partly because
the county is near its saturation point.

About one in three hotel rooms was of the extended-stay variety in 1999,
according to a study by the Highland Group, an Atlanta firm specializing in
the extended-stay market. The national average is roughly one in 20 rooms.

But hoteliers such as Andrew Pace, president of Norcross-based SuiteOne,
said they would open additional lodges in Gwinnett, if it weren't for the
restrictions.

"It's as if the county has made the choice that all they want is higher-end
hotels," Pace said.

Norcross and Suwanee were among the towns that passed similar rules roughly
three years ago.

And no one is happier to see them working than Suwanee Police Chief Mike Jones.

Each week an officer spends three days patrolling the town's three
extended-stay hotels. And the force's "I-85 detail" is by far its busiest,
Jones said.

The high density of rooms increases the chances of conflict between
neighbors, Jones said. These hotels are a favorite among drug dealers and
prostitutes who move often and try to stay one step ahead of the law, he said.

"We've made arrests at extended-stays where they're cutting and cooking
crack," Jones said. "They've been setting up computers and printers and
counterfeiting ID cards."

Suwanee's police force averages about one drug bust per month at the
hotels, Jones said. The city netted 10 pounds of cocaine in one recent arrest.

Hotel executives blame a few bad apples for the backlash in Gwinnett.

"Some of my compadres, they built a bunch of crap," said Bob Henritze,
president of SunSuites, an Atlanta-based chain with two hotels in Gwinnett.

Henritze said he sympathizes with county officials and understands their
trepidation.

"It was a clever way to basically ban extended-stay hotels through building
requirements without actually banning them," he said.