BRIDGESTREET ACCOMMODATIONS INC, S-1/A, 1997-07-11

BRIDGESTREET ACCOMMODATIONS INC
S-1/A, 1997-07-11
HOTELS & MOTELS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 11, 1997

REGISTRATION NO. 333-26647
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 2

TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------

BRIDGESTREET ACCOMMODATIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------

<TABLE>
<S> <C> <C>
DELAWARE 7021 04-3327773
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

30670 BAINBRIDGE ROAD

SOLON, OH 44139

(216) 248-3005

(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------

WILLIAM N. HULETT, III
BRIDGESTREET ACCOMMODATIONS, INC.

30670 BAINBRIDGE ROAD

SOLON, OH 44139

(216) 248-3005

(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES OF COMMUNICATIONS TO:

CONSTANTINE ALEXANDER, ESQUIRE
NUTTER, MCCLENNEN & FISH, LLP
ONE INTERNATIONAL PLACE
BOSTON, MA 02110
(617) 439-2000

MARTIN CARMICHAEL III, P.C.

GOODWIN, PROCTER & HOAR LLP

EXCHANGE PLACE
BOSTON, MA 02109
(617) 570-1000

------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If the Form is a post-effective amendment filed pursuant to Rule 426(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
------------------------

CALCULATION OF REGISTRATION FEE

================================================================================

<TABLE>
<CAPTION>
TITLE OF EACH CLASS PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITIES AMOUNT TO OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED BE REGISTERED(1) PER SHARE PRICE(2) REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock (par value $.01 per share)... 3,007,250 $10.00 $30,072,500.00 $9,113(3)
</TABLE>

================================================================================

(1) Includes 392,250 shares that the Underwriters have the option to purchase to
cover-allotments and 915,000 shares held by certain selling stockholders.

(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457 under the Section Act of 1933, as amended.

(3) In connection with the initial filing of this Registration Statement on May
7, 1997, an initial filing fee of $10,910.00 was paid.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.

SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED JULY 11, 1997

2,615,000 SHARES

BRIDGESTREET ACCOMMODATIONS, INC.
COMMON STOCK

------------------------

Of the 2,615,000 shares of Common Stock offered hereby, 1,700,000 shares
are being issued and sold by BridgeStreet Accommodations, Inc. ("BridgeStreet"
or the "Company") and 915,000 shares are being sold by certain stockholders of
the Company (the "Selling Stockholders"). See "Principal and Selling
Stockholders." The Company will not receive any proceeds from the sale of Common
Stock by the Selling Stockholders. See "Use of Proceeds." Prior to this
offering, there has been no public market for the Common Stock. It is currently
estimated that the initial public offering price will be between $8.00 and
$10.00 per share. See "Underwriting" for a discussion of the factors considered
in determining the initial public offering price. Officers, directors and
principal stockholders of the Company and their affiliates, some of whom are
Selling Stockholders, will receive an aggregate of approximately $7.7 million,
or 38.5%, of the net proceeds of this offering (assuming an initial public
offering price of $9.00 per share and after deducting estimated underwriting
discounts and commissions and estimated offering expenses), and upon the
completion of the offering will beneficially own an aggregate of 52.4% of the
outstanding shares of Common Stock.

Application has been made for quotation of the Common Stock on the Nasdaq
National Market under the symbol "BEDS." There can be no assurance that such
application will be accepted.

SEE "RISK FACTORS" BEGINNING ON PAGE 9 FOR A DISCUSSION OF CERTAIN RISKS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
=======================================================================================================
Proceeds to
Price to Underwriting Proceeds to Selling
Public Discounts(1) Company(2) Stockholders
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per Share.............................. $ $ $ $
- -------------------------------------------------------------------------------------------------------
Total(3)............................... $ $ $ $
=======================================================================================================
</TABLE>

(1) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933. See
"Underwriting."

(2) Before deducting expenses of the offering estimated at $2,000,000, payable
by the Company.

(3) The Company has granted to the Underwriters a 30-day option to purchase up
to 392,250 additional shares of Common Stock from the Company on the same
terms and conditions as set forth above solely to cover over-allotments, if
any. If the Underwriters exercise such option in full, the total Price to
Public, Underwriting Discount, Proceeds to Company and Proceeds to Selling
Stockholders will be $ , $ , $ and $ , respectively.
See "Underwriting."

------------------------

The shares of Common Stock are offered by the Underwriters, subject to
prior sale, when, as and if delivered to and accepted by them, subject to their
right to reject any order in whole or in part and to certain other conditions.
The Underwriters reserve the right to withdraw, cancel or modify such offer and
to reject offers in whole or in part. It is expected that delivery of
certificates for the shares of the Common Stock will be made at the offices of
Legg Mason Wood Walker, Incorporated, Baltimore, Maryland on or about
, 1997.

------------------------
LEGG MASON WOOD WALKER
INCORPORATED
------------------------
, 1997
<PAGE> 3

[MAP AND PHOTOS TO COME]

THE UNDERWRITERS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK. SUCH
TRANSACTIONS MAY INCLUDE THE PURCHASE OF THE COMMON STOCK TO STABILIZE ITS
MARKET PRICE, THE PURCHASE OF THE COMMON STOCK TO COVER SYNDICATE SHORT
POSITIONS AND THE IMPOSITION OF PENALTY BIDS. FOR A DESCRIPTION OF THESE
ACTIVITIES, SEE "UNDERWRITING."
------------------------

The Company intends to furnish its stockholders with annual reports
containing audited consolidated
financial statements and an opinion thereon expressed by an independent public
accounting firm, and with quarterly reports for the first three quarters of each
fiscal year containing unaudited interim consolidated financial information.

The Company has filed an application with the United States Patent and
Trademark Office to register the service mark "BridgeStreet."

<PAGE> 4

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and pro forma and historical financial statements, including the
notes thereto, appearing elsewhere in this Prospectus. BridgeStreet
Accommodations, Inc. ("BridgeStreet" or the "Company") was incorporated in 1996,
and in January and March 1997 acquired by merger (the "Combination") five
flexible accommodation service providers (the "Founding Companies"). See
"Combination." Unless otherwise indicated, the information contained in this
Prospectus (i) gives effect to the Combination and (ii) assumes that the
Underwriters' over-allotment option will not be exercised. Investors should
carefully consider the information set forth under the heading "Risk Factors."

THE COMPANY

BridgeStreet is a leading provider of flexible accommodation services,
primarily for business people and professionals requiring lodging for one week
to several months. The Company offers high-quality, fully-furnished apartments,
townhouses, condominiums and, to a lesser extent, houses (collectively,
"accommodations"). Together with the specialized amenities offered by the
Company, these accommodations are intended to provide guests with a "home away
from home." As of June 30, 1997, BridgeStreet had more than 2,700 units under
lease in 16 metropolitan areas located in the Midwest and Mid-Atlantic regions
of the United States, and an occupancy rate of approximately 92%.

As a provider of flexible accommodation services, BridgeStreet leases
substantially all of its accommodations on a short-term basis from property
managers, and then rents them to its clients. This enables the Company to (i)
adjust the quantity, mix and location of its accommodations as client needs
dictate and local economic conditions warrant, (ii) expand and enter new markets
without the costs and lead times associated with investing in "bricks and
mortar" and (iii) avoid the fixed costs associated with ownership or long-term
leasing of real estate. The Company also leases the furniture for its
accommodations on a short-term basis from furniture rental companies. These
furniture leasing arrangements enable BridgeStreet to maintain well-appointed,
modern and attractive accommodations, upgrade and replace furniture as needed,
and satisfy specific furnishing requests. BridgeSteet's leasing strategy
distinguishes it from fixed-location lodging providers, such as all-suite or
extended-stay hotels, that own their lodging facilities and furnishings or lease
them on a long-term basis.

Traditionally, travelers on extended trips have stayed in hotels and
motels. According to the American Hotel and Motel Association, in 1995, guests
staying three or more nights represented approximately 37% of total domestic
hotel stays during that year. The Company believes that business travelers on
extended trips increasingly desire alternatives to conventional hotel and motel
rooms, which typically lack the spaciousness and amenities of home. The Company
believes that this has been an important factor in the recent growth, evidenced
by a 17.9% compound annual growth rate in total room revenue over the past ten
years, in the extended-stay segment of the lodging industry. Participants in
this segment include flexible accommodation service providers, all-suite hotels
and extended-stay hotels.

By providing flexible accommodation services, the Company can satisfy
client requests for accommodations in a variety of locations and neighborhoods,
as well as requests for accommodations of specific types and sizes. The
substantial majority of the Company's accommodations are located within
high-quality property complexes that typically feature, among other things,
in-unit washers and dryers, dedicated parking and access to fitness facilities
(including, in many cases, pools, saunas and tennis courts). In addition, at a
guest's request, BridgeStreet can upgrade an accommodation by providing
specialized amenities such as office furniture, fax machines and computers. The
Company's accommodations generally are priced competitively with all-suite and
upscale extended-stay hotel rooms even though, on average, the Company believes
its accommodations are substantially larger.

3
<PAGE> 5

units on December 31, 1996, representing a compound annual growth rate of 36%.
In addition, combined net revenues increased from $18.9 million in 1994 to $37.6
million in 1996, representing a compound annual growth rate of 41%.

The Company plans to achieve its goal of becoming a leading national
provider of flexible accommodation services by implementing an aggressive
acquisition program and a national operating strategy designed to increase
internal revenue growth, cost efficiencies and profitability. Key elements of
the Company's business strategy include:

Growth through Acquisitions. The Company believes that the flexible
accommodation services industry is highly fragmented, with over 400
geographically dispersed companies in the United States, few of which have more
than a regional presence. BridgeStreet plans to take advantage of the fragmented
nature of the industry by acquiring flexible accommodation service companies in
major metropolitan areas frequented by business travelers. BridgeStreet intends
to implement its business model at each acquired company as soon as practicable
after the acquisition is completed. BridgeStreet's acquisition strategy is to:

- Enter New Geographic Markets and Establish Nationwide Coverage. In each
new market, the Company initially will target for acquisition one local
or regional flexible accommodation services provider having the size and
quality of operations suitable for serving as the Company's base for
expansion in the market. Acquisitions in new markets will enable
BridgeStreet to (i) gain local or regional market share rapidly, (ii)
increase sales to existing clients by meeting their needs for
accommodations in other regions, (iii) increase sales to the acquired
company's clients by providing them with access to BridgeStreet's growing
national network and (iv) establish the BridgeStreet brand name in new
regions and enhance its nationwide recognition.

- Expand Within Existing Markets. Once the Company has established
operations in a new region, it may seek to expand its market share by
acquiring other flexible accommodation service providers within that
region. The Company believes that it can achieve operating efficiencies
by incorporating the businesses of smaller acquired companies into the
Company's operations without any significant increase in infrastructure.
On June 30, 1997, the Company acquired the assets of a flexible
accommodation services provider in Memphis, Tennessee with 135 units
under lease.

National Operating Strategy. The Company has begun to implement a national
operating strategy with the following components:

- Maximize Sales to Existing and New Clients. The Company plans to
maximize sales to existing corporate clients and to obtain new clients
through a national sales and marketing program which highlights the
Company's expanding national network. Many of the Company's clients are
Fortune 1000 companies with significant, national employee lodging
requirements. These corporate clients generally have numerous key
decision makers (such as human resource directors, relocation managers or
training directors) who both establish and administer company travel and
accommodation policies. The Company plans to obtain a greater share of
each client's lodging requirements by establishing relationships with
additional key decision makers and emphasizing the Company's expanding
national presence.

- Achieve Cost Efficiencies. The Company believes it should be able to
reduce total operating expenses of the Founding Companies and any
additional acquired companies by consolidating certain functions
(including sales, marketing and purchasing operations) performed
separately by such companies. In addition, the Company believes that as a
large, national flexible accommodation services company, it should be
able to achieve lower costs (as a percentage of revenues) compared to
those of the individual Founding Companies and other acquired companies
in such areas as leasing accommodations and furniture, purchasing certain
hard and soft goods, and obtaining financing arrangements, employee
benefits and insurance.

4
<PAGE> 6

and cash flow management. BridgeStreet believes the implementation of
these practices will enable the Company to provide superior customer
service and maximize sales opportunities.

- Implement Management Information System. BridgeStreet intends to develop
and implement a centrally-controlled, computerized management information
system that will integrate the Company's customer contact, sales,
marketing, finance, telephone, property management, internet access,
lease management and reservation functions. BridgeStreet believes that
the proposed system will enable it to deliver superior customer service,
more efficiently manage its operations and achieve cost savings.

The Company is a Delaware corporation. Its principal executive offices are
located at 30670 Bainbridge Road, Solon, Ohio 44139 and its telephone number is
(216) 248-3005. As used herein, unless the context otherwise requires,
"BridgeStreet" or the "Company" refers to BridgeStreet Accommodations, Inc. and
its wholly-owned subsidiaries.

THE OFFERING

<TABLE>
<S> <C>
Common Stock offered by the Company.......... 1,700,000 shares
Common Stock offered by the Selling
Stockholders............................... 915,000 shares
Common Stock to be outstanding after the
offering................................... 7,175,000 shares (1)
Use of proceeds.............................. To repay certain indebtedness, including
indebtedness of the Founding Companies assumed
by the Company in connection with the
Combination, the outstanding principal amount
under the Company's revolving credit facility
and certain advances made to the Company by an
affiliated party, to implement an enhanced
management information system and for general
corporate purposes, including working capital
and future acquisitions. See "Use of
Proceeds."
Proposed Nasdaq National Market symbol....... BEDS
</TABLE>

- ---------------

(1) Excludes an aggregate of 1,100,000 shares of Common Stock reserved for
issuance under the Company's 1997 Equity Incentive Plan and Stock Plan for
Non-Employee Directors. Of this amount, 470,667 and 37,500 shares of Common
Stock will be issuable upon exercise of outstanding options under the 1997
Equity Incentive Plan and Stock Plan for Non-Employee Directors,
respectively. See "Management -- Director Compensation" and " -- Executive
Compensation; Equity Incentive Plan."

5
<PAGE> 7
- --------------------------------------------------------------------------------

SUMMARY UNAUDITED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND FOOTNOTE DATA)

The following summary unaudited financial data presents certain data for
the Company, as adjusted (a) in the case of the Combined Statement of Operations
Data, for (i) the effects of the Combination on a historical basis, (ii) the
effects of certain pro forma adjustments to the historical financial statements
of the Founding Companies and (iii) the consummation of this offering, and (b)
in the case of the As Adjusted Consolidated Balance Sheet Data, for the
consummation of this offering. See the Company's Unaudited Pro Forma Combined
Financial Statements and Consolidated Financial Statements as of and for the
three months ended March 31, 1997 and the notes thereto included elsewhere in
this Prospectus.

<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
YEAR ENDED THREE MONTHS ENDED
DECEMBER 31, MARCH 31,
1996(1) 1997(1)(2)
------------ ------------------
<S> <C> <C>
COMBINED STATEMENT OF OPERATIONS DATA:
Revenues.................................................... $37,566 $10,269
Operating income (loss)(3).................................. 2,115 (391)
Income (loss) before income taxes(4)........................ 2,108 (351)
Net income (loss)(5)........................................ $ 1,196 $ (183)
======= =======
Net income (loss) per share................................. $ 0.17 $ (.03)
======= =======
Weighted average shares outstanding......................... 7,175,000 7,175,000
</TABLE>

<TABLE>
<CAPTION>
MARCH 31, 1997
---------------------------------
ACTUAL AS ADJUSTED(6)
-------------- --------------
<S> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Working capital............................................... $ 533 $ 11,220
Total assets.................................................. 14,997 24,352
Long-term debt, net of current maturities..................... 1,542 --
Total stockholders' equity.................................... 8,006 20,236
</TABLE>

- ---------------
(1) The Combined Statements of Operations Data assumes that the Combination and
this offering took place at the beginning of the period. This data is not
necessarily indicative of the results the Company would have had if these
events actually then occurred or of the Company's future results. The
Combined Statement of Operations Data for the year ended December 31, 1996
excludes (i) any adjustments for the compensation to be paid in 1997 for
services to be rendered in 1997 by the Company's Chief Executive Officer and
Chief Financial Officer pursuant to their employment agreements, and (ii)
non-recurring, non-cash compensation expense recorded in the first quarter
of 1997 in connection with the accelerated vesting of restricted stock. The
Combined Statement of Operations Data for the three months ended March 31,
1997 assumes the acquisition of Home Again at the beginning of the period.
The pro forma data is based on preliminary estimates, available information
and certain assumptions that management deems appropriate and should be read
in conjunction with the other financial statements and notes thereto
included elsewhere in this Prospectus.
(2) Includes non-recurring, non-cash compensation expense of $563,000 recorded
in connection with the accelerated vesting of restricted stock. This
represents a reduction of $.04 per share in the Combined Statement of
Operations.
(3) Reflects (i) for the year ended December 31, 1996, the reduction of $552,000
in salary and benefits to executives of the Founding Companies and the
$172,000 of amortization of goodwill to be recorded as a result of the
Combination, assuming a 35-year amortization period, and (ii) for the three
months ended March 31, 1997, an increase of $30,000 in such salary and
benefits and the $7,000 of amortization of such goodwill.
(4) Reflects an interest expense reduction of $158,000 for the year ended
December 31, 1996 and $33,000 for the three months ended March 31, 1997
related to bank debt and notes payable to be repaid from the net proceeds of
this offering.
(5) Reflects an increase in the Company's historical provision for income taxes
of $373,000 for the year ended December 31, 1996 to account for the
Company's estimated consolidated effective tax rate subsequent to the
Combination, after considering nondeductible goodwill amortization, and a
decrease in the historical benefit for income taxes for the three months
ended March 31, 1997 to account for the estimated consolidated effective tax
rate after considering nondeductible goodwill and nondeductible compensation
expense.
(6) Reflects the issuance of 1,700,000 shares of Common Stock by the Company in
this offering and the application of the net proceeds as described under
"Use of Proceeds."

- --------------------------------------------------------------------------------
6
<PAGE> 8

SUMMARY INDIVIDUAL FOUNDING COMPANY FINANCIAL AND OTHER DATA
(DOLLARS IN THOUSANDS)

The following table presents summary data for each of the Founding
Companies (including their respective affiliates, if any) for the three most
recent fiscal years.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------
1994 1995 1996
------ ------ -------
<S> <C> <C> <C>
Temporary Corporate Housing Columbus, Inc.
Revenues........................................................ $8,309 $9,754 $12,502
Operating income................................................ 206 336 1,087
Operating income, pro forma(1).................................. 156 390 1,170
Number of units at end of year.................................. 510 539 624
Corporate Lodgings, Inc.
Revenues........................................................ $4,069 $6,067 $ 8,820
Operating income................................................ 87 39 195
Operating income, pro forma(1).................................. 76 184 255
Number of units at end of year.................................. 213 301 434
Exclusive Interim Properties, Ltd.(2)
Revenues........................................................ $4,015 $5,521 $ 8,626
Operating income................................................ 104 300 213
Operating income, pro forma(1).................................. 166 490 344
Number of units at end of year.................................. 125 302 441
Home Again, Inc.
Revenues........................................................ $ 532 $1,570 $ 4,035
Operating income................................................ 49 74 315
Operating income (loss), pro forma(1)........................... (77) (51) 200
Number of units at end of year.................................. 40 100 198
Temporary Housing Experts, Inc.
Revenues........................................................ $2,000 $3,086 $ 3,583
Operating income (loss)......................................... 115 30 (73)
Operating income, pro forma(1).................................. 161 194 148
Number of units at end of year.................................. 153 214 239
</TABLE>

- ---------------

(1) Reflects (i) an adjustment to the compensation of an executive of the
Founding Company to reflect the compensation to be paid to such executive
pursuant to an employment agreement signed in connection with the
Combination and (ii) amortization of goodwill to be recorded as a result of
the Combination, assuming a 35-year amortization period and the push-down of
goodwill to the acquired entities. The adjustment increased (decreased)
historical operating income for each Founding Company as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
COMPANY 1994 1995 1996
-------------------------------------------------------- ---- ----- -----
<S> <C> <C> <C>
Temporary Corporate Housing Columbus, Inc............... $(50) $ 54 $ 83
Corporate Lodgings, Inc................................. (11) 145 60
Exclusive Interim Properties, Ltd.(2)................... 62 190 131
Home Again, Inc......................................... (126) (125) (115)
Temporary Housing Experts, Inc.......................... 46 164 221
</TABLE>

(2) Prior to the Combination, Exclusive Interim Properties, Ltd.'s fiscal year
end was March 31. The 1994 and 1995 data presents data for that company's
fiscal years ended March 31, 1995 and 1996, respectively. The 1996 data
presents 12 months of data derived from the unaudited three-month period
ended March 31, 1996 and the audited nine-month period ended December 31,
1996.

7
<PAGE> 9

RISK FACTORS

The following factors should be considered, together with the other
information in this Prospectus, in evaluating an investment in the Company. This
Prospectus contains, in addition to historical information, forward-looking
statements that involve risks and uncertainties. The Company's actual results
could differ significantly from the results discussed in the forward-looking
statements as a result of any number of factors, including the risk factors set
forth below and other factors discussed elsewhere in this Prospectus.

LIMITED COMBINED OPERATING HISTORY

BridgeStreet was founded in August 1996 to acquire flexible accommodation
service providers and has only conducted combined operations since the
Combination in the first quarter of 1997. Prior to the Combination, each of the
Founding Companies operated (together with any affiliates) as a separate,
independent entity. The Company intends to continue to operate the Founding
Companies under their current management, although it will integrate some sales,
marketing and customer service functions, implement centralized financial and
management information systems and controls, and implement "best practices"
throughout its operations. The Company's senior management group has been
assembled only recently, and there can be no assurance that this group will be
successful in the Company's integration and implementation efforts, in managing
the combined operations of the Founding Companies or in implementing the
Company's business strategy. Any failure to do so could have a material adverse
effect on the Company's business, financial condition and results of operations.
See "Management."

RISKS ASSOCIATED WITH ACQUISITION STRATEGY AND PLANNED RAPID EXPANSION

As part of its strategy to establish a nationwide presence, the Company has
targeted the following markets within which to expand its operations: Atlanta,
Boston, Chicago, Dallas, Denver, Houston, Los Angeles, New York, Philadelphia,
Phoenix, San Francisco, Seattle, Tampa, Toronto and Vancouver. BridgeStreet
intends to grow in part through the acquisition of additional flexible
accommodation service providers in these and other major metropolitan markets
throughout the United States. However, in cases where the Company seeks to enter
a new market but is unable to acquire a suitable existing provider on terms the
Company deems acceptable, the Company may elect to establish a new operation or
strategic alliance in that market. The Company also intends to pursue rapid
internal growth through expansion of existing and acquired operations. See
"Business -- Growth Strategy" and "-- Acquisition and Growth Strategy."

There can be no assurance that the Company will be successful in entering
any market which it has targeted for expansion. There can be no assurance that
the Company will be able to identify, acquire or profitably manage additional
businesses or successfully integrate any acquired businesses into the Company
without substantial costs, delays or other operational or financial problems.
Certain risks inherent in an acquisition strategy, such as increasing leverage
and debt service requirements (to the extent that the Company elects to finance
its acquisitions with debt) and difficulties associated with combining disparate
company systems and cultures, could adversely affect the Company's ability to
integrate acquired businesses. The process of integrating acquired companies may
involve unforeseen difficulties and may require a disproportionate amount of
management's attention and financial and other resources. Moreover, increased
competition for acquisition candidates may develop, in which event fewer
acquisition opportunities may be available to the Company and acquisition costs
for the opportunities that are available may be higher. There can be no
assurance that any business acquired in the future will achieve anticipated
revenues and earnings. In addition, the size, timing and integration of such
acquisitions may cause substantial fluctuations in the Company's operating
results from quarter to quarter. To the extent that the Company chooses to enter
particular markets by establishing new operations, its results may be adversely
affected by the increased time required for such operations to achieve
profitability. Future internal growth will depend on a number of factors,
including the effective and timely initiation and development of client
relationships, the availability of additional accommodations on acceptable
terms, the maintenance of the high quality of services the Company provides to
its guests, and the recruitment, training, motivation and retention of qualified
employees.

8
<PAGE> 10

Sustaining the Company's growth and expansion will require substantial
enhancements to the Company's operational and financial systems and controls as
well as additional administrative, operational and financial resources. There
can be no assurance that the Company will be able to manage its expanding
operations successfully or that it will be able to maintain or accelerate its
growth, and any failure to do so could have a material adverse effect on the
Company's business, financial condition and results of operations.

RISKS RELATED TO ACQUISITION FINANCING

The Company may choose to finance future acquisitions by issuing shares of
Common Stock for a portion or all of the consideration to be paid. In the event
that the Common Stock does not maintain a sufficient market value, or potential
acquisition candidates otherwise are unwilling to accept Common Stock as part of
the consideration for the sale of their businesses, the Company might not be
able to utilize Common Stock as consideration for acquisitions and would be
required to utilize more of its cash resources, if available, in order to
maintain its acquisition program. If the Company does not have sufficient cash
resources, its growth could be limited unless it could obtain additional capital
through debt or equity financings. While the Company currently has a $10 million
revolving credit facility to finance acquisitions, there can be no assurance
that this credit facility will be sufficient for the Company's acquisition
financing needs in the near term, or that additional financing will be available
if and when needed or on terms acceptable to the Company. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources -- Combined." The inability of the
Company to use its Common Stock as consideration for future acquisitions or to
obtain additional financing for acquisitions could have a material adverse
effect on the Company's business, financial condition and results of operations.
In addition, there can be no assurance that future issuances of Common Stock in
connection with acquisitions will not be dilutive to the Company's stockholders.

MARKET ACCEPTANCE OF BRAND NAME

BridgeStreet has yet to complete the integration of the Founding Companies
and, as a result, has limited history upon which to gauge client acceptance of
its combined operations. Further, the Company will compete against other
companies with substantially greater brand name recognition, and there can be no
assurance that the Company will be able to persuade clients of such competitors
to use the Company's services. The failure of the Company to successfully
establish and promote "BridgeStreet" as a recognized brand name capable of
attracting sufficient numbers of clients, or the receipt of adverse publicity
relating to the Company's brand name, could have a material adverse effect on
the Company's business, financial condition and results of operations. See
"Business -- Sales and Marketing" and "-- Competition."

DEPENDENCE ON THIRD PARTIES

BridgeStreet generally leases its accommodations from residential property
managers. The Company's profitability largely depends on its ability to lease
accommodations on favorable terms, and local or regional declines in either
vacancy rates or new apartment construction could lead to an increase in leasing
costs or an inability to satisfy client demand. The Company also leases the
furniture used in its accommodations from furniture rental companies, which may
increase their prices, restrict the Company's flexibility in renting greater or
lesser amounts of furniture, or otherwise impose unfavorable conditions on the
Company's ability to customize the furnishings in its accommodations. The
Company's reliance on third party vendors, assuming the occurrence of any of the
events described above, would negatively affect the Company's operating margins
and could have a material adverse effect on the Company's business, financial
condition and results of operations. See "Business -- Properties" and
" -- Accommodations and Services."

MARKET CONDITIONS MAY AFFECT PROFITABILITY

The Company's operating results depend primarily on the difference, or
"spread," between the rental rates it charges its clients for accommodations and
the lease amounts it pays to the owners or managers of such accommodations. The
rates that the Company is able to charge its customers in a given market can be
expected to fluctuate based in part on conditions existing within the lodging
industry as a whole, including the

9
<PAGE> 11

occupancy rates of, and average daily rates being charged by, hotels and other
competitors. To the extent competitors in a given market were to exert downward
pressure on the rates that the Company is able to charge its clients, the
Company's aggregate "spread" could decrease. In addition, while the Company
seeks to manage the risks of fluctuating rates by "matching" its rental
obligations with the length of its clients' stays through flexible lease
arrangements, competitive rental market conditions could force the Company to
enter into longer-term, fixed rate leases in order to establish or protect its
unit inventory. The fixed rates in such leases also might lead to a reduction in
the Company's "spread" in the event of downward trends in lodging prices. A
reduction in the Company's "spread," as a result of either lower average daily
rates charged by competitors or longer-term leases entered into by the Company,
could have a material adverse effect on the Company's business, financial
condition and results of operations. See "Business -- Industry Overview" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

FACTORS AFFECTING TRAVEL, SEASONALITY AND CYCLICALITY

The Company's operations are subject to events generally affecting levels
of business and leisure travel, including business cycles, political changes and
technological advances. The Company cannot predict the likelihood of occurrence
of any such events. To the extent any such event significantly reduces travel,
there could be a material adverse effect on the Company's business, financial
condition and results of operations. The Company typically experiences a decline
in earnings during its first quarter due to a decrease in business travel
following the holiday season and travel disruptions caused by winter weather. As
a general matter, due to (i) the Company's reliance on corporate clients and
(ii) the strong correlation between the lodging industry's performance and
macroeconomic conditions, the Company may be subject to cyclical changes in
revenues and profits in response to changes in the national economy or the
economies of the regions in which it operates. See "Management's Discussion of
Financial Condition and Results of Operations -- Seasonality."

COMPETITION

The lodging industry generally, and the flexible accommodation services
industry in particular, is highly competitive. Providers of flexible
accommodation services compete with each other and with traditional hotels,
motels, and all-suite and extended-stay hotels, primarily on the basis of
location, availability, price and quality of accommodations, brand name
recognition, and quality and scope of service. The Company competes with other
flexible accommodation service providers both for clients and for possible
acquisitions. The Company expects its business to become more competitive as
existing competitors expand and new competitors enter the industry. Moreover,
because the financial barriers to entry are relatively low in the flexible
accommodation services industry, entities that maintain a vendor-vendee
relationship with companies in this industry, such as real estate managers or
furniture rental businesses, have entered the industry and more such entities
may decide to enter the industry in the future. Certain of the Company's
existing competitors have, and any new competitors that enter the industry may
have, access to significantly greater financial resources than the Company. In
particular, Oakwood Corporate Housing, Inc. ("Oakwood"), a flexible
accommodation services provider which currently rents a substantially larger
number of accommodations than the Company, is affiliated with R&B Realty Group,
the nation's tenth largest apartment management company. This affiliation gives
Oakwood access to apartment communities and capital that may be unavailable to
the Company. Competitive market conditions could have a material adverse effect
on the Company's business, financial condition and results of operations. See
"Business -- Competition."

DEPENDENCE ON KEY PERSONNEL

BridgeStreet's day-to-day operations depend on the continuing efforts of
its executive officers and the senior management of the Company's operating
subsidiaries. In particular, the Company depends on: William N. Hulett, III, its
President and Chief Executive Officer; Rocco A. Di Lillo, its Vice President and
Chief Operating Officer; and Mark D. Gagne, its Chief Financial Officer and
Treasurer. While the Company has entered into employment agreements with these
individuals, there can be no assurance that the Company will be able to retain
the services of any of them. If any of these individuals does not continue in
his management role following this offering and if the Company is unable to
attract and retain qualified replacements, there

10
<PAGE> 12

could be a material adverse effect on the Company's business, financial
condition and results of operations. Each of the employment agreements with
these individuals contains non-competition covenants with the Company. See
"Management."

LICENSING AND TAX ISSUES

As a lessee of its accommodations, BridgeStreet believes that it and its
employees are either outside the purview of, exempted from or in compliance with
laws in the jurisdictions in which the Company operates requiring real estate
brokers to hold licenses. However, there can be no assurance that the Company's
position in any jurisdiction where it believes itself to be excepted or exempted
will be upheld if challenged or that any such jurisdiction will not amend its
laws to specifically require the Company and/or one or more of its employees to
be licensed brokers. Moreover, there can be no assurance that the Company will
not operate in the future in additional jurisdictions requiring such licensing.
If the Company were found to have failed to comply with brokerage licensing
laws, there could be a material adverse effect upon the Company's business,
financial condition and results of operations.

The Company provides flexible accommodation services for extended periods
in leased as opposed to fixed-location accommodations. As a result, in some of
the jurisdictions in which the Company operates, the Company believes that it is
exempt from sales and "bed" taxes that many jurisdictions require fixed-location
lodging providers to charge their overnight guests. The imposition of a sales or
"bed" tax requirement on the Company in the jurisdictions in which the Company
operates and currently does not charge such taxes, or the pursuit by taxing
authorities of arrearages and penalties with respect to prior periods during
which the Company did not collect and remit such taxes, could have a material
adverse effect on the Company's business, financial condition and results of
operations. See "Business -- Regulation and Tax."

CONTROL BY DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS

Upon completion of this offering, the Company's directors, executive
officers and principal stockholders, together with their affiliates, will
beneficially own approximately 52.4% of the Company's outstanding shares of
Common Stock (approximately 49.7% if the Underwriters exercise their
over-allotment option in full). As a result, these stockholders, if acting
together, will have the ability to influence the outcome of corporate actions
requiring stockholder approval, including the election of directors and the
approval of significant corporate transactions, such as a merger or sale of
substantially all of the Company's assets, irrespective of how other
stockholders of the Company may vote. This concentration of ownership may have
the effect of delaying or preventing a change in control of the Company. See
"Management" and "Principal and Selling Stockholders."

POSSIBLE FUTURE SALES OF SHARES

Sales of substantial amounts of Common Stock in the public market after
this offering under Rule 144 under the Securities Act of 1933, as amended (the
"Securities Act"), or otherwise, or the perception that such sales could occur,
may adversely affect prevailing market prices of the Common Stock and could
impair the future ability of the Company to raise capital through an offering of
its equity securities or to effect acquisitions using shares of its Common
Stock. Prior to this offering, the Company had outstanding 5,475,000 shares of
Common Stock, of which 915,000 are being offered by the Selling Stockholders in
this offering. The remaining 4,560,000 shares are "restricted securities" within
the meaning of Rule 144. Subject to the contractual lockup provisions discussed
below and unless the resale of the shares is registered under the Securities
Act, these shares may not be sold in the open market until after the first
anniversary of the transaction in which they were acquired, and then only in
compliance with the applicable requirements of Rule 144. See "Shares Eligible
for Future Sale."

11
<PAGE> 13

Incentive Plan and Directors' Plan or in connection with acquisitions), for a
period of 180 days after the date of this Prospectus without the written consent
of the Representative. See "Shares Eligible for Future Sale."

CERTAIN ANTI-TAKEOVER PROVISIONS

The Company's Certificate of Incorporation and By-Laws as in effect upon
the closing of this offering will require that any action required or permitted
to be taken by stockholders of the Company must be effected at a duly called
annual or special meeting of stockholders and may not be effected by any consent
in writing, and will require reasonable advance notice by a stockholder with
respect to a proposal or director nomination such stockholder desires to present
at any such meeting. Special meetings of stockholders may be called only by the
President or Chairman of the Company or by the Board of Directors. In addition,
the Board of Directors will have the authority, without further action by the
stockholders, to fix the rights and preferences of, and issue up to 5,000,000
shares of, Preferred Stock. These provisions and other provisions of the
Certificate of Incorporation and By-Laws may have the effect of deterring
unsolicited acquisition proposals or hostile takeovers or delaying or preventing
changes in control or management of the Company, including transactions in which
stockholders might otherwise receive a premium for their shares of Common Stock
over the then current market prices. In addition, these provisions may limit the
ability of stockholders to approve transactions that they may deem to be in
their best interests. The Company also is subject to Section 203 of the Delaware
General Corporation Law (the "DGCL") which, subject to certain exceptions,
prohibits a Delaware corporation from engaging in any of a broad range of
business combinations with any "interested stockholder" for a period of three
years following the date that such stockholder became an interested stockholder.
See "Description of Capital Stock."

NO PRIOR MARKET FOR COMMON STOCK AND POSSIBLE VOLATILITY OF STOCK PRICE

Prior to this offering, there has been no public market for the Common
Stock, and there can be no assurance that an active public market for the Common
Stock will develop or continue after this offering. The initial public offering
price of the Common Stock was determined by negotiations between the Company and
the Representative of the Underwriters, and may not be indicative of the market
price for the Common Stock after this offering. See "Underwriting" for a
description of the factors considered in determining the initial public offering
price. From time to time after this offering, there may be significant
volatility in the market price for the Common Stock. Quarterly operating results
of the Company, changes in general conditions in the economy or the lodging
industry, or other developments affecting the Company or the Company's
competitors could cause the market price of the Common Stock to fluctuate
substantially. The equity markets have, on occasion, experienced significant
price and volume fluctuations that have affected the market prices for many
companies' securities and have been unrelated to the operating performance of
those companies. Any such fluctuations following completion of this offering may
adversely affect the prevailing market price of the Common Stock.

IMMEDIATE AND SUBSTANTIAL DILUTION

The purchasers of the shares of Common Stock offered hereby will experience
immediate and substantial dilution in the net tangible book value of their
shares of Common Stock in the amount of $7.08 per share, and may experience
further dilution in that value from issuances of Common Stock in connection with
future acquisitions. See "Dilution."

ABSENCE OF DIVIDENDS

The Company has never paid dividends on the Common Stock and does not
anticipate paying any dividends in the foreseeable future. Declarations of
dividends on the Common Stock will depend upon, among other things, future
earnings, if any, the operating and financial condition of the Company, its
capital requirements and general business conditions. The Company's credit
facility currently prohibits dividend payments. See "Dividend Policy."

12
<PAGE> 14

COMBINATION

The Company was incorporated in August 1996 to become a leading national
provider of flexible accommodation services. In the Combination, the Company
acquired the Founding Companies through stock-for-stock mergers and issued
4,301,000 shares of Common Stock to their former stockholders. For a description
of the transactions pursuant to which these companies were merged into
BridgeStreet, see "Certain Transactions -- Organization of the Company; The
Combination." Certain of such stockholders are Selling Stockholders in the
offering. See "Principal and Selling Stockholders."

Set forth below is a brief description of each of the Founding Companies:

Temporary Corporate Housing Columbus, Inc.: Temporary Corporate Housing
Columbus, Inc. (together with three affiliates, "TCH") was founded by Lynda D.
Clutchey and Max Holzer in 1983. TCH is headquartered in Columbus, Ohio and,
prior to its acquisition by the Company, operated its flexible accommodation
services business in the following metropolitan areas: Cincinnati, Cleveland and
Columbus, Ohio; and Pittsburgh, Pennsylvania. During its fiscal year ended
December 31, 1996, TCH had combined revenues of approximately $12.5 million.

Corporate Lodgings, Inc.: Corporate Lodgings, Inc. (together with four
affiliates, "CLI") was founded by Rocco A. Di Lillo in 1987. CLI is
headquartered in Hudson, Ohio and, prior to its acquisition by the Company,
operated its flexible accommodation services business in the following
metropolitan areas: Akron, Canton and Cleveland, Ohio; Lexington and Louisville,
Kentucky; Minneapolis, Minnesota; Milwaukee, Wisconsin; Pittsburgh,
Pennsylvania; and Detroit, Michigan. During its fiscal year ended December 31,
1996, CLI had combined revenues of approximately $8.8 million.

Exclusive Interim Properties, Ltd.: Exclusive Interim Properties, Ltd.
(together with an affiliate, "EIP") was founded by Melanie R. Sabelhaus in 1987.
EIP is headquartered in Baltimore, Maryland and, prior to its acquisition by the
Company, operated its flexible accommodation services business in the Baltimore,
Maryland and District of Columbia metropolitan areas. During its 12 months ended
December 31, 1996, EIP had combined revenues of approximately $8.6 million.

Home Again, Inc.: Home Again, Inc. (together with two affiliates, "Home
Again") was founded by Sandra A. Brown in 1993. Home Again is headquartered in
Minneapolis, Minnesota and, prior to its acquisition by the Company, operated
its flexible accommodation services business in the Minneapolis, Minnesota and
Oklahoma City, Oklahoma metropolitan areas. During its fiscal year ended
December 31, 1996, Home Again had combined revenues of approximately $4.0
million.

Temporary Housing Experts, Inc.: Temporary Housing Experts, Inc. ("THEI")
was founded in 1991 by Connie F. and Thomas W. O'Briant. THEI is headquartered
in Memphis, Tennessee and, prior to its acquisition by the Company, operated its
flexible accommodation services business in the Memphis, Tennessee and Jackson,
Mississippi metropolitan areas. During its fiscal year ended December 31, 1996,
THEI had revenues of approximately $3.6 million.

13
<PAGE> 15

USE OF PROCEEDS

The total net proceeds from this offering are estimated to be approximately
$19.9 million (approximately $23.2 million if the Underwriters' over-allotment
option is exercised in full), of which $12.2 million will be received by the
Company and $7.7 million will be received by the Selling Stockholders (assuming
an initial public offering price of $9.00 per share and after (i) deducting
estimated underwriting discounts and commissions and (ii) reimbursing American
Business Partners, LLC ("ABP") for offering expenses paid by ABP (estimated at
$2.0 million), see "Certain Transactions--Organization of the Company; ABP").
ABP is an affiliate of Paul M. Verrochi, Chairman of the Company.

The Company currently intends to use approximately (i) $1.4 million of the
net proceeds to repay certain indebtedness of the Founding Companies assumed in
connection with the Combination (which indebtedness bears interest at a weighted
average interest rate of 7.6% and matures at various dates through December
2008), (ii) $2.2 million of the net proceeds to repay amounts the Company
estimates will be outstanding under its revolving credit facility with Fleet
National Bank at the closing of this offering (which amounts bear interest at
the bank's prime lending rate of interest, which was 8.5% as of June 30, 1997)
and (iii) $210,000 of the net proceeds to repay indebtedness incurred to repay
certain indebtedness of the Founding Companies (which indebtedness bears
interest at a rate of 7.6%). The Company also intends to use approximately $1.5
million of the net proceeds to enhance its management information system
capabilities. While the Company intends to repay all amounts borrowed under its
revolving credit facility upon the closing of this offering, which amounts have
been used to fund the $1.0 million purchase price in connection with the
Company's acquisition on June 30, 1997 of the assets of a flexible accommodation
services company in Memphis, Tennessee and to fund short-term working capital
requirements, it will be able to continue to borrow funds from this facility
following the offering, subject to the terms of the credit facility agreement.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources -- Combined."

In addition, the Company also intends to use approximately $252,000 of the
net proceeds to repay (i) all outstanding amounts due under a loan made to the
Company by the spouse of one of the Company's directors (which loan bears
interest at a rate of 8.0% and had a principal balance of approximately $41,000
as of June 30, 1997), (ii) the outstanding balance under a personal line of
credit maintained by one of the Company's directors that was used to finance
certain working capital requirements of one of the Founding Companies (which
balance bears interest at a rate of 8.25% and aggregated approximately $11,000
as of June 30, 1997), and (iii) approximately $175,000 to ABP for expenses
advanced in connection with the Combination. See "Certain
Transactions--Organization of the Company; ABP" and "--Transactions Involving
Officers and Directors."

The balance of the net proceeds to the Company from this offering,
approximately $6.6 million, will be used for working capital and general
corporate purposes, including possible acquisitions. Although the Company
regularly reviews strategic acquisition opportunities, the Company at this time
has no binding agreements with respect to any material acquisitions. Pending the
use of the net proceeds of this offering for the purposes described above, the
Company will invest such proceeds in short-term, interest-bearing, investment
grade securities.

DIVIDEND POLICY

Following this offering, the Company intends to retain all earnings to
finance the growth and development of its business and does not anticipate
paying cash dividends on the Common Stock in the foreseeable future. Any future
determination as to the payment of dividends on the Common Stock will be at the
discretion of the Board of Directors and will depend upon, among other things,
the Company's future earnings, if any, the operating and financial condition of
the Company, its capital requirements, general business conditions and any other
factors the Board of Directors of the Company may consider. The Company's
revolving credit facility currently prohibits dividend payments.

14
<PAGE> 16

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
March 31, 1997 (i) on an actual basis and (ii) as adjusted to reflect the
amendment and restatement of the Company's Certificate of Incorporation on April
10, 1997, the sale of the 1,700,000 shares of Common Stock offered by the
Company hereby (at an assumed initial public offering price of $9.00 per share
and after deducting estimated underwriting discounts and commissions and
estimated offering expenses incurred by the Company) and the application of the
net proceeds therefrom as described under "Use of Proceeds." This table should
be read in conjunction with the Company's Unaudited Consolidated Financial
Statements as of and for the three months ended March 31, 1997 and the related
notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
MARCH 31, 1997
----------------------
ACTUAL AS ADJUSTED
------ -----------
(IN THOUSANDS)
<S> <C> <C>
DEBT:
Current maturities of long-term debt.................................. $ 109 $ --
====== =======
Long-term debt, net of current maturities............................. $1,542 $ --

STOCKHOLDERS' EQUITY:
Preferred Stock, $.01 par value: none authorized, actual; 5,000,000
shares authorized, none issued or outstanding, as adjusted......... -- --
Common Stock, $.01 par value: 10,000,000 shares authorized, 5,475,000
shares issued and outstanding, actual; 35,000,000 shares
authorized, 7,175,000 shares issued and outstanding, as
adjusted(1)........................................................ 55 72
Additional paid-in capital............................................ 8,191 20,404
Accumulated deficit................................................... (240) (240)
------- ------
---
Total stockholders' equity......................................... 8,006 20,236
------- ------
---
Total capitalization.......................................... $9,548 $20,236
======= =======
</TABLE>

- ---------------

(1) Excludes an aggregate of 1,100,000 shares of Common Stock reserved for
issuance under the Company's 1997 Equity Incentive Plan and Stock Plan for
Non-Employee Directors. Of this amount, 470,667 and 37,500 shares of Common
Stock will be issuable upon exercise of outstanding options under the 1997
Equity Incentive Plan and Stock Plan for Non-Employee Directors,
respectively, as of the date of this Prospectus. See "Management -- Director
Compensation" and " -- Executive Compensation; Stock Option Plan."

15
<PAGE> 17

DILUTION

The net tangible book value of the Company as of March 31, 1997 was
approximately $1.6 million, or $0.29 per share. Net tangible book value per
share represents the book value of the Company's total tangible assets less
total liabilities divided by the number of shares of Common Stock outstanding.
After giving effect to the sale by the Company of 1,700,000 shares of Common
Stock in this offering at an assumed initial public offering price of $9.00 per
share and after deducting estimated underwriting discounts and commissions and
estimated offering expenses incurred by the Company, the net tangible book value
at March 31, 1997 would have been approximately $13.8 million, or $1.92 per
share. This represents an immediate increase in net tangible book value per
share of $1.63 to the existing stockholders, and an immediate dilution in net
tangible book value per share of $7.08 to new investors. The following table
illustrates this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price................................ $9.00
Net tangible book value before offering............................ $0.29
Increase attributable to new investors............................. 1.63
-----
Net tangible book value after offering............................... 1.92
------
Dilution to new investors............................................ $7.08
======
</TABLE>

The following table sets forth, as of March 31, 1997, the number of shares
of Common Stock purchased from the Company, the total consideration paid and the
average price per share paid by the Company's existing stockholders and by
investors purchasing shares of Common Stock offered hereby (assuming an initial
offering price of $9.00 per share and before deducting underwriting discounts
and commissions and estimated offering expenses):

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
--------------------- ----------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
--------- ------- ----------- ------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders......... 5,475,000 76.3% $ 1,414,000 8.5% $ 0.26
New investors................. 1,700,000 23.7 15,300,000 91.5 $ 9.00
--------- ------ ----------- ------
Total............... 7,175,000 100.0% $16,714,000 100.0%
========= ====== =========== ======
</TABLE>

16
<PAGE> 18

SELECTED FINANCIAL AND OTHER DATA

(IN THOUSANDS, EXCEPT SHARE AND FOOTNOTE DATA)

For financial reporting purposes, TCH is presented as the acquiror of all
of the other companies acquired by BridgeStreet in the Combination.
Consequently, the Company's historical combined financial statements for periods
ended on or before December 31, 1996 are the historical combined financial
statements of TCH. The historical financial statements as of March 31, 1997 and
for the period then ended are of the Company and include the accounts of each of
the Founding Companies from its date of acquisition. The following selected
historical financial data of TCH as of December 31, 1995 and 1996 and for each
year in the three-year period ended December 31, 1996 has been derived from the
audited financial statements of TCH included elsewhere herein. The remaining
selected historical financial data of TCH and the Company has been derived from
unaudited financial statements of TCH and the Company, which have been prepared
on the same basis as the audited financial statements and, in the opinion of
management, reflect all adjustments, consisting of normal recurring adjustments,
necessary for a fair presentation of that data.

HISTORICAL
HISTORICAL (TCH ONLY) PRO FORMA (TCH ONLY) HISTORICAL PRO FORMA
------------------------------------------- COMBINED ------------ ------------- -------------
YEAR ENDED DECEMBER 31, YEAR ENDED THREE MONTHS ENDED MARCH 31,
------------------------------------------- DECEMBER 31, --------------------------------------------
1992 1993 1994 1995 1996 1996(1) 1996 1997 1997(1)
------ ------ ------ ------ ------- ------------ ------------ ------------- -------------

<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF
OPERATIONS DATA:
Revenues............ $5,627 $6,803 $8,309 $9,754 $12,502 $37,566 $2,638 $9,102 $10,269
Cost of services.... 4,520 5,312 6,475 7,354 9,088 27,945 1,988 7,012 7,835
Selling, general and
administrative
expense........... 1,328 1,373 1,628 2,064 2,327 7,334(2) 483 2,513(3) 2,773(2)(3)
Goodwill
amortization...... -- -- -- -- -- 172(4) -- 45 52(4)
------ ------ ------ ------ ------- ------- ------ ------ -------
Operating income
(loss)............ (221) 118 206 336 1,087 2,115 167 (468) (391)
Interest and other
income (expense),
net............... 11 5 21 53 89 (7)(5) 27 6 40(5)
------ ------ ------ ------ ------- ------- ------ ------ -------
Income (loss) before
provision for
income taxes...... (210) 123 227 389 1,176 2,108 194 (462) (351)
Provision (benefit)
for income
taxes............. (84) 49 114 178 512 912(6) 84 (224) (168)(6)
------ ------ ------ ------ ------- ------- ------ ------ -------
Net income (loss)... $ (126) $ 74 $ 113 $ 211 $ 664 $ 1,196 $ 110 $ (238) $ (183)
====== ====== ====== ====== ======= ======= ====== ====== =======
Net income (loss)
per share......... $ 0.17 $(0.04) $ (0.03)
======= ====== =======
Weighted average
shares
outstanding....... 7,175,000 5,475,000 7,175,000
</TABLE>

<TABLE>
<CAPTION>
HISTORICAL (TCH ONLY)
----------------------------------------
DECEMBER 31, MARCH 31, 1997
---------------------------------------- -----------------------------
1992 1993 1994 1995 1996 ACTUAL AS ADJUSTED(7)
---- ------ ------ ------ ------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital................................ $499 $ 592 $ 496 $ 563 $ 986 $ 533 $11,220
Total assets................................... 901 1,209 1,672 2,510 2,013 14,997 24,352
Long-term debt, less current maturities........ 16 10 67 -- -- 1,542 --
Total stockholders' equity..................... 471 545 658 869 1,184 8,006 20,236
</TABLE>

See accompanying notes on following page.

17
<PAGE> 19

(1) The Pro Forma Combined Statement of Operations Data assumes that the
Combination and this offering took place at the beginning of the period.
This data is not necessarily indicative of the results the Company would
have had if these events had actually then occurred or of the Company's
future results. The Pro Forma Combined Statement of Operations Data for the
year ended December 31, 1996 excludes (i) any adjustments for the
compensation to be paid in 1997 for services to be rendered in 1997 by the
Company's Chief Executive Officer and Chief Financial Officer pursuant to
their employment agreements and (ii) non-recurring, non-cash compensation
expense recorded in the first quarter of 1997 in connection with the
accelerated vesting of restricted stock. The Pro Forma Statement of
Operations Data for the three months ended March 31, 1997 assumes the
acquisition of Home Again at the beginning of the period. The pro forma data
presented herein is based on preliminary estimates, available information
and certain assumptions that management deems appropriate and should be read
in conjunction with the Company's Unaudited Pro Forma Financial Statements
and the other financial statements and notes thereto included elsewhere in
this Prospectus.
(2) Reflects the reduction of $552,000 in salary and benefits to executives of
the Founding Companies for the year ended December 31, 1996 and an increase
of $30,000 in salary and benefits for the three months ended March 31, 1997.
(3) Includes non-recurring, non-cash compensation expense of $563,000 recorded
in connection with the accelerated vesting of restricted stock. This
represents a reduction of $.05 per share in the historical consolidated
statement of operations and $.04 per share in the pro forma statement of
operations.
(4) Reflects the $172,000 and $7,000 amortization of goodwill to be recorded as
a result of the Combination for the year ended December 31, 1996 and the
three months ended March 31, 1997, respectively, assuming a 35-year
amortization period.
(5) Reflects an interest expense reduction of $158,000 for the year ended
December 31, 1996 and $33,000 for the three months ended March 31, 1997
related to bank debt and notes payable to be repaid from the net proceeds of
this offering.
(6) Reflects an increase in the Company's historical provision for income taxes
of $373,000 for the year ended December 31, 1996 to account for the
Company's estimated consolidated effective tax rate subsequent to the
Combination, after considering nondeductible goodwill amortization, and a
decrease in the historical benefit for income taxes for the three months
ended March 31, 1997 to account for the estimated consolidated 1997
effective tax rate, after considering nondeductible goodwill and
nondeductible compensation expense.
(7) Reflects the issuance of 1,700,000 shares of Common Stock by the Company in
this offering and the application of the net proceeds as described under
"Use of Proceeds."

18
<PAGE> 20

SELECTED INDIVIDUAL FOUNDING COMPANY FINANCIAL AND OTHER DATA
(DOLLARS IN THOUSANDS)

The selected historical and pro forma financial data presented below for
the individual Founding Companies (including their respective affiliates, if
any) is derived from, and should be read in conjunction with, their respective
audited financial statements and related notes thereto appearing elsewhere in
this Prospectus.

- ---------------

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
31,
--------------------
COMPANY 1994 1995 1996
------------------------------------------------------------ ---- ----- -----
<S> <C> <C> <C>
Temporary Corporate Housing Columbus, Inc................... $(50) $ 54 $ 83
Corporate Lodgings, Inc..................................... (11) 145 60
Exclusive Interim Properties, Ltd.(2)....................... 62 190 131
Home Again, Inc............................................. (126) (125) (115)
Temporary Housing Experts, Inc.............................. 46 164 221
</TABLE>

19
<PAGE> 21

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Company's
Unaudited Pro Forma Combined Financial Statements and the Founding Companies'
Financial Statements and the related notes thereto appearing elsewhere in this
Prospectus.

INTRODUCTION

BridgeStreet was incorporated in August 1996 with the goal of becoming a
leading national provider of flexible accommodation services. The Company plans
to achieve this goal by implementing an aggressive acquisition program and a
national operating strategy designed to increase internal revenue growth, cost
efficiencies and profitability. In the first quarter of 1997, BridgeStreet
acquired by merger the five Founding Companies in the Combination.

The Company's revenues are derived primarily from renting accommodations to
guests for extended periods. Revenues depend on the number of accommodations the
Company has available under lease, the occupancy rate and the rate charged. The
rate charged is a function of, among other factors, (i) the type, size and
location of the accommodation being rented, (ii) the rental period and (iii) any
additional amenities made available to the guest during his or her stay. Cost of
services consists primarily of lease payments for accommodations and their
furnishings, and expenses associated with cleaning, maintaining and providing
utilities to accommodations. Selling, general and administrative expense
consists primarily of compensation and related benefits for management and key
employees, administrative salaries and benefits, office rents and utilities,
professional fees and advertising.

Prior to their acquisition by BridgeStreet, the Founding Companies were
managed as independent private businesses. As such, their historical results of
operations reflect different tax structures (i.e., S corporations and C
corporations) which have influenced, among other things, their historical levels
of owners' compensation and benefits. Certain Founding Company owners agreed to
reductions in their compensation and benefits in connection with the
Combination.

BridgeStreet currently is in the process of integrating the Founding
Companies and their operations and administrative functions. This integration
process may present opportunities to (i) enhance revenues through the geographic
cross-sell capabilities that each of the Founding Companies can provide to its
existing clients and (ii) reduce costs through, among other things, the
elimination of duplicative functions and the receipt of greater volume discounts
from vendors. However, integration also will necessitate additional costs and
expenditures related to corporate management and administration, public company
operations, systems integration and facilities expansion. As a result of these
possible cost savings and various additional costs, historical operating results
may not be comparable to, or indicative of, future performance. There can be no
assurance that the Company's integration efforts will be successful. See "Risk
Factors -- Limited Combined Operating History."

For financial reporting purposes, Temporary Corporate Housing Columbus,
Inc. (together with its three affiliates) is presented as the acquiror of the
other Founding Companies. Consequently, the Company's historical financial
statements for periods ended on or before December 31, 1996 are the historical
financial statements of TCH.

RESULTS OF OPERATIONS - BRIDGESTREET INTERIM RESULTS

Three Months Ended March 31, 1997 (the "1997 Period") Compared to Three Months
Ended March 31, 1996 (the "1996 Period").

BridgeStreet's Consolidated Statement of Operations for the 1997 Period
contained in this Prospectus include the unaudited accounts of TCH, CLI, EIP and
THEI, all of which were merged with the Company on January 2, 1997, but do not
include the accounts of Home Again, which was acquired on March 31, 1997.
However, BridgeStreet's Consolidated Statement of Operations for the 1996 Period
included in this Prospectus are the unaudited accounts of only TCH, the
designated accounting acquiror. Consequently, the

20
<PAGE> 22

1996 Period and the 1997 Period are not comparable and the comparison of the two
periods below is not indicative of future results of operations. The Company's
Consolidated Balance Sheet at March 31, 1997 reflects the accounts of all the
Founding Companies, including Home Again.

Revenues. Revenues increased $6.5 million, or 245%, from $2.6 million in
the 1996 Period to $9.1 million in the 1997 Period as a result of an increase in
the number of accommodations rented. This increase in the number of
accommodations rented primarily was a result of the Combination and also growth
in existing markets.

Cost of Services. Cost of services increased $5.0 million, or 253%, from
$2.0 million in the 1996 Period to $7.0 million in the 1997 Period. Cost of
services as a percentage of revenues increased slightly from 75.4% in the 1996
Period to 77.0% in the 1997 Period. The dollar increase in cost of services
primarily was related to the Combination. Cost of services as a percentage of
revenues was adversely affected by certain pricing practices at one of the
Founding Companies, which practices have been discontinued.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $2.0 million, or 420%, from approximately
$483,000 in the 1996 Period to $2.5 million in the 1997 Period. Selling, general
and administrative expense includes $562,500 of a non-recurring, non-cash
compensation charge relating to the accelerated vesting of officers' restricted
stock. Excluding this one-time charge, selling, general and administrative
expense would have been approximately $2.0 million in the 1997 Period, an
increase of 304% over the 1996 Period. Selling, general and administrative
expense as a percentage of revenues increased from 18.3% to 21.4%, excluding the
non-recurring charge. The dollar increase in selling, general and administrative
expense primarily was a result of the Combination. The increase in such expense
as a percentage of revenues resulted from hiring additional personnel and
acquiring in the Combination certain companies that had higher general and
administrative expense as a percentage of revenues.

Income Tax Provision (Benefit). The Company recorded a tax benefit of
approximately $224,000, at an effective rate of 48.5%, for the 1997 Period
compared to a tax provision of approximately $84,000, at an effective rate of
43.5%, for the 1996 Period. The effective rate for the 1997 Period is the
Company's estimated consolidated effective tax rate for the 1997 fiscal year
after considering nondeductible goodwill and nondeductible compensation expense
in connection with the vesting of restricted stock.

LIQUIDITY AND CAPITAL RESOURCES - BRIDGESTREET

During the 1997 Period, net cash used in operating activities was
approximately $147,000, primarily to meet working capital needs. Net cash
provided by investing activities was approximately $65,000, primarily from cash
acquired from the acquisition of the Founding Companies, partially offset by the
purchase of operating stock and equipment required in the Company's business.
Net cash provided by financing activities was approximately $361,000, primarily
from an increase in long-term debt and amounts due to stockholders, partially
offset by costs associated with this offering. Cash, cash equivalents and
investments in short-term marketable securities increased by approximately
$280,000 during the 1997 Period and totaled $1.1 million at March 31, 1997.

The Company has a revolving credit facility with Fleet National Bank, the
material terms of which are summarized as follows. The facility provides the
Company with a revolving line of credit of up to $10.0 million, secured by
guarantees by certain material subsidiaries of the Company and a pledge of the
capital stock of all of the Company's wholly-owned operating subsidiaries. The
credit facility may be used for the refinancing of the Company's subsidiaries'
indebtedness, post-offering acquisitions and working capital. Loans made under
the credit facility bear interest, at the Company's option of either the bank's
prime lending rate or 1.25% above the Eurodollar rate. The credit facility will
terminate on March 31, 2002, or sooner at the discretion of the Company, and all
amounts outstanding thereunder (if any) will be due upon such termination. The
credit facility (i) prohibits the payment of dividends and other distributions
by the Company, (ii) generally will not permit the Company to incur or assume
other indebtedness and (iii) requires the Company to comply with certain
financial covenants. The Company had $300,000 and $2.2 million outstanding at
March 31, 1997 and July 11, 1997, respectively.

21
<PAGE> 23

On March 31, 1997 the Company acquired Home Again in a stock-for-stock
merger and issued 475,000 shares of Common Stock as merger consideration. The
acquisition has been accounted for using the purchase method of accounting. The
Company recorded approximately $1.3 million of goodwill related to the
transaction that will be amortized over a period of 35 years. Home Again had
combined revenues of approximately $4.0 million for the year ended December 31,
1996 and approximately $1.2 million for the 1997 Period.

The Company's primary sources of funding to date have been cash flow from
operations, commercial credit facilities and loans from affiliates. The Company
anticipates that in addition to the net proceeds from this offering, cash flow
from operations and borrowings under its credit facility will be its principal
future sources of funding. The Company's principal future uses of cash, in
addition to cash used in operating activities, are likely to be repayment of
debt and investment in the Company's management information systems and funding
of acquisitions. See "Use of Proceeds." While there can be no assurance,
management believes that cash flow from operations, funds from the Company's
credit facility and the net proceeds to the Company from this offering will be
adequate to meet the Company's capital requirements for the next 12 months,
depending on the size and methods of financing potential acquisitions.

On June 30, 1997 the Company acquired for cash all the assets of Corporate
Housing Services, Inc., a provider of flexible accommodation services in the
Memphis, Tennessee metropolitan area. The acquisition has been accounted for
using the purchase method of accounting. Corporate Housing Services, Inc. had
revenues of approximately $2.5 million for the year ended December 31, 1996. The
acquisition purchase price was $1.0 million and was funded through borrowings
from the Company's revolving line of credit.

SEASONALITY

Quarterly earnings may be affected by the timing of certain holidays,
business and vacation patterns, weather conditions, economic factors and other
considerations affecting travel. Corporate relocation activity peaks in the
summer months and declines significantly during the first part of the first
quarter. Long-term consulting activity tends to follow a similar pattern, but
not to the same extent. The Company expects to realize lower revenues, operating
income and net income during the first quarter.

RESULTS OF OPERATIONS -- COMBINED

The Combined Founding Company Statements of Operations data for the years
ended December 31, 1994, 1995 and 1996 do not purport to present the combined
Founding Companies in accordance with generally accepted accounting principles,
but represent merely a summation of the data of the individual Founding
Companies on a historical basis and do not include the effects of pro forma
adjustments. This data will not be comparable to and may not be indicative of
the Company's post-Combination results of operations because (i) the Founding
Companies historically were not under common control or management and had
different tax structures during the periods presented, (ii) the Company used the
purchase method of accounting to reflect the Combination and (iii) the Founding
Companies were not all acquired at the same time.

22
<PAGE> 24

The following table sets forth certain unaudited combined data of the
Founding Companies and that data as a percentage of revenues on a historical
basis and excludes the effects of pro forma adjustments for the periods
indicated (dollars in thousands):

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
1994 1995 1996(1)
----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Revenues..................... $18,925 100.0% $25,998 100.0% $37,566 100.0%
Cost of services............. 14,048 74.2 19,121 73.5 27,944 74.4
Selling, general and
administrative expense..... 4,413 23.3 6,099 23.5 7,884 21.0
------- ----- ------- ----- ------- -----
Operating income............. $ 464 2.5% $ 778 3.0% $ 1,738 4.6%
======= ===== ======= ===== ======= =====
</TABLE>

- ---------------

(1) Data for the period ending December 31, 1996 includes data derived from
EIP's unaudited three-month period ended March 31, 1996 and the audited
nine-month period ended December 31, 1996. Data for 1995 and 1994 includes
data for EIP's fiscal years ended March 31, 1996 and March 31, 1995,
respectively.

1996 Compared to 1995

Revenues. Revenues increased $11.6 million, or 44.5%, from $26.0 million
in 1995 to $37.6 million in 1996. Revenues for each of the Founding Companies
increased during this period. The increase primarily was a result of an increase
in the number of accommodations rented during the year, both in existing markets
and in new markets.

Cost of Services. Cost of services increased $8.8 million, or 46.1%, from
$19.1 million in 1995 to $27.9 million in 1996. Cost of services as a percentage
of revenues increased slightly from 73.5% in 1995 to 74.4% in 1996. The dollar
increase in cost of services resulted primarily from an increase in the number
of accommodations leased during the year. Cost of services as a percentage of
revenues was adversely affected by certain pricing practices at one of the
Founding Companies, which since have been discontinued, as well as higher
leasing and maintenance costs and lower occupancy rates resulting from the entry
by another Founding Company into new markets.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $1.8 million, or 29.3%, from $6.1 million in
1995 to $7.9 million in 1996, primarily as a result of an increase in staffing
required to support the increased number of accommodations, higher compensation
paid to owners of the Founding Companies and increased overhead costs associated
with entering new markets. Selling, general and administrative expense decreased
as a percentage of revenues from 23.5% in 1995 to 21.0% in 1996, generally as a
result of spreading the fixed costs of the Founding Companies' operations over a
larger revenue base.

1995 Compared to 1994

Revenues. Revenues increased $7.1 million, or 37.4%, from $18.9 million in
1994 to $26.0 million in 1995. Revenues for each of the Founding Companies
increased during this period. The increase primarily was a result of an increase
in the number of accommodations rented during the year, both in existing markets
and in new markets. In addition, Home Again initiated operations in mid-1993,
and as a result did not have its operations fully implemented during 1994.

Cost of Services. Cost of services increased $5.1 million, or 36.1%, from
$14.0 million in 1994 to $19.1 million in 1995 as a result of the increase in
the number of accommodations leased during the year. Cost of services as a
percentage of revenues decreased slightly from 74.2% in 1994 to 73.5% in 1995.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $1.7 million, or 38.2%, from $4.4 million in
1994 to $6.1 million in 1995, and increased slightly as a percentage of revenues
from 23.3% in 1994 to 23.5% in 1995. The increase both in dollars and as a
percentage of revenues

23
<PAGE> 25

primarily was a result of an increase in staffing required to support the
increased number of accommodations, higher compensation paid to certain owners
of the Founding Companies and increased overhead costs associated with entering
new markets.

LIQUIDITY AND CAPITAL RESOURCES -- COMBINED

On a combined basis, the Founding Companies generated $1.6 million and
$700,000 of net cash from operating activities during 1995 and 1996,
respectively. TCH and EIP generated the most cash flow from operating activities
in 1995 (approximately $620,000 and $403,000, respectively); and Home Again and
EIP generated the most cash flow from operating activities in 1996
(approximately $562,000 and $293,000, respectively). Net cash used in investing
activities by the Founding Companies was $791,000 during each of 1995 and 1996.
Cash used in investing activities primarily was for the purchase of operating
stock and property and equipment. EIP and THEI used the most cash for investing
activities in 1995 (approximately $333,000 and $138,000, respectively); and EIP
and Home Again used the most cash for investing activities in 1996
(approximately $337,000 and $335,000, respectively). Net cash used in financing
activities by the Founding Companies on a combined basis was approximately
$150,000 and $350,000 during 1995 and 1996, respectively. Net cash used in
financing activities primarily was for the repayment of notes to stockholders,
payment of long-term debt and distributions to stockholders. TCH and EIP used
the most cash for financing activities in 1995 (approximately $156,000 and
$74,000, respectively); and TCH and Home Again used the most cash for financing
activities in 1996 (approximately $270,000 and $56,000, respectively). The
combined cash and cash equivalents of the Founding Companies decreased by
$400,000, from $1.4 million in 1995 to $1.0 million in 1996. At December 31,
1996, three of the Founding Companies had a working capital deficit aggregating
approximately $700,000.

IMPACT OF INFLATION

Due to the low levels of inflation experienced in 1994, 1995 and 1996,
inflation did not have a significant effect on the combined results of the
Founding Companies in those years.

INDIVIDUAL FOUNDING COMPANIES

RESULTS OF OPERATIONS -- TEMPORARY CORPORATE HOUSING

1996 Compared to 1995 and 1995 Compared to 1994

Revenues. Revenues increased $2.7 million, or 28.2%, from $9.8 million in
1995 to $12.5 million in 1996. This increase was a result of an increase in the
number of accommodations rented during the year, an improvement in the occupancy
rate and an increase in the rates realized by TCH. Revenues increased $1.4
million, or 17.4%, from $8.3 million in 1994 to $9.8 million in 1995. This
increase was a result of an increase in the number of accommodations rented
during the year, an improvement in the occupancy rate and an increase in the
rates realized by TCH.

Cost of Services. Cost of services increased $1.7 million, or 23.6%, from
$7.4 million in 1995 to $9.1 million in 1996, primarily as a result of an
increase in the number of accommodations leased and the cost of furnishing such
accommodations during the year. Cost of services as a percentage of revenues
decreased from 75.4% in 1995 to 72.7% in 1996 as a result of an improved
occupancy rate and an increase in the rates realized by TCH. Cost of services
increased $879,000, or 13.6%, from $6.5 million in 1994 to $7.4 million in 1995,
primarily as a result of an increase in the number of accommodations leased and
the cost of furnishing such accommodations during the year. Cost of services as
percentage of revenues decreased from 77.9% in 1994 to 75.4% in 1995 as a result
of an improved occupancy rate and an increase in the rates realized by TCH.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $263,000, or 12.7%, from $2.1 million in 1995
to $2.3 million in 1996, primarily as a result of increased compensation to the
stockholders, administrative payroll and sales commissions. Selling, general and
administrative expense as a percentage of revenues decreased from 21.2% in 1995
to 18.6% in 1996, primarily as a result of spreading the fixed costs of the
company's operations over a larger revenue base. Selling, general and
administrative expense increased $436,000, or 26.8%, from $1.6 million in 1994
to $2.1 million in 1995.

24
<PAGE> 26

Selling, general and administrative expense increased as a percentage of
revenues increased from 19.6% in 1994 to 21.2% in 1995. This increase both in
dollars and as a percentage of revenues primarily was a result of increased
compensation to the stockholders, administrative payroll and sales commissions.

LIQUIDITY AND CAPITAL RESOURCES -- TEMPORARY CORPORATE HOUSING

For the three years ended December 31, 1996, TCH generated $873,000 in net
cash flow from operating activities. Increases in cash flow primarily were
generated from net income plus depreciation and amortization of $1.2 million,
while reductions in cash flow were due to increases in accounts receivable
balances of $401,000 attributable to TCH's increased sales levels. TCH also
expended $374,000 during this period, primarily for purchases of operating stock
and property and equipment. Cash used in financing activities was $432,000
during this period and primarily was attributable to loans to stockholders and a
dividend to stockholders of $349,000.

At December 31, 1996, TCH had working capital of $986,000. TCH historically
has funded its operations from cash provided by operating activities. At
December 31, 1996, TCH had cash and cash equivalents of $598,000 with no
outstanding indebtedness.

RESULTS OF OPERATIONS -- CORPORATE LODGINGS

1996 Compared to 1995 and 1995 Compared to 1994

Revenues. Revenues increased $2.7 million, or 45.4%, from $6.1 million in
1995 to $8.8 million in 1996. This increase was a result of an increase in the
number of accommodations rented during the year, an improvement in the occupancy
rate and an increase in the rates realized by CLI. Revenues increased $2.0
million, or 49.1%, from $4.1 million in 1994 to $6.1 million in 1995. This
increase was a result of an increase in the number of accommodations rented
during the year and an increase in the rates realized by CLI.

Cost of Services. Cost of services increased $2.1 million, or 50.9%, from
$4.0 million in 1995 to $6.1 million in 1996. Cost of services as percentage of
revenues also increased, from 66.7% in 1995 to 69.2% in 1996. The increase both
in dollars and as a percentage of revenues primarily was a result of an increase
in the cost to lease, furnish and clean a unit. Cost of services increased $1.3
million, or 47.4%, from $2.7 million in 1994 to $4.0 million in 1995, primarily
as a result of an increase in the number of accommodations leased and the cost
of furnishing such accommodations during the year. Cost of services as
percentage of revenues decreased from 67.5% in 1994 to 66.7% in 1995 primarily
as a result of an increase in the rates realized by CLI.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $537,000, or 27.1%, from $2.0 million in 1995
to $2.5 million in 1996, primarily as a result of increased compensation to the
majority stockholder, increased sales and administrative payroll, and general
office expenses. Selling, general and administrative expense as a percentage of
revenues decreased from 32.7% in 1995 to 28.6% in 1996, primarily as a result of
spreading the fixed costs of the company's operations over a larger revenue
base. Selling, general and administrative expense increased $745,000, or 60.2%,
from $1.2 million in 1994 to $2.0 million in 1995. Selling, general and
administrative expense as a percentage of revenues increased from 30.4% in 1994
to 32.7% in 1995. The increase both in dollars and as a percentage of revenues
primarily was a result of costs associated with entering the Milwaukee,
Wisconsin market and expansion within the Lexington, Kentucky market.

RESULTS OF OPERATIONS -- EXCLUSIVE INTERIM PROPERTIES

Twelve Months Ended December 31, 1996 Compared to Fiscal Year Ended March 31,
1996 and Fiscal Year Ended March 31, 1996 Compared to Fiscal Year Ended March
31, 1995

Revenues. Revenues increased $3.1 million, or 56.2%, from $5.5 million in
the fiscal year ended March 31, 1996 to $8.6 million in the 12 months ended
December 31, 1996. This increase was a result of an increase in the number of
accommodations rented. Revenues increased $1.5 million, or 37.5%, from $4.0

25
<PAGE> 27

million in the fiscal year ended March 31, 1995 to $5.5 million in the fiscal
year ended March 31, 1996, as a result of an increase in the number of
accommodations rented during the year.

Cost of Services. Cost of services increased $2.8 million, or 65.8%, from
$4.2 million in the fiscal year ended March 31, 1996 to $7.0 million in the 12
months ended December 31, 1996, primarily as a result of an increase in the
number of accommodations leased. Cost of services as a percentage of revenues
increased from 76.9% in the fiscal year ended March 31, 1996 to 81.6% in the 12
months ended December 31, 1996. The increase in cost of services as a percentage
of revenues primarily was attributable to the effect of certain pricing
practices, which since have been discontinued. Cost of services increased $1.2
million, or 40.8%, from $3.0 million in the fiscal year ended March 31, 1995 to
$4.2 million in the fiscal year ended March 31, 1996, as a result of an increase
in the number of accommodations leased during the year. Cost of services as a
percentage of revenues increased from 75.1% in the fiscal year ended March 31,
1995 to 76.9% in the fiscal year ended March 31, 1996.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $399,000, or 40.9%, from $975,000 in the fiscal
year ended March 31, 1996 to $1.4 million in the 12 months ended December 31,
1996. Selling, general and administrative expense as a percentage of revenues
decreased from 17.7% in the fiscal year ended March 31, 1996 to 15.9% in the 12
months ended December 31, 1996, primarily as a result of spreading the fixed
costs of the company's operations over a larger revenue base. Selling, general
and administrative expense increased $80,000, or 8.9%, from $895,000 in the
fiscal year ended March 31, 1995 to $975,000 in the fiscal year ended March 31,
1996. Selling, general and administrative expense as a percentage of revenues
decreased from 22.3% in the fiscal year ended March 31, 1995 to 17.7% in the
fiscal year ended March 31, 1996, primarily as a result of spreading the fixed
costs of the company's operations over a larger revenue base.

RESULTS OF OPERATIONS -- HOME AGAIN

1996 Compared to 1995

Revenues. Revenues increased $2.5 million, or 157.0%, from $1.6 million in
1995 to $4.0 million in 1996. This increase was a result of an increase in the
number of accommodations rented during the year.

Cost of Services. Cost of services increased $1.9 million, or 144.1%, from
$1.3 million in 1995 to $3.1 million in 1996, as a result of an increase in the
number of accommodations leased during the year. Cost of services as percentage
of revenues decreased from 81.8% in 1995 to 77.7% in 1996, primarily as a result
of spreading the fixed costs of the company's operations over a larger revenue
base.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $374,000, or 176.4%, from $212,000 in 1995 to
$586,000 in 1996. The increase both in dollars and as a percentage of revenues
primarily was a result of increased compensation to the stockholder and an
increase in administrative payroll.

RESULTS OF OPERATIONS -- TEMPORARY HOUSING EXPERTS

1996 Compared to 1995

Revenues. Revenues increased $500,000, or 16.1%, from $3.1 million in 1995
to $3.6 million in 1996. This increase was a result of an increase in the number
of accommodations rented during the year.

Cost of Services. Cost of services increased $388,000, or 17.7%, from $2.2
million in 1995 to $2.6 million in 1996. The increase both in dollars and as a
percentage of revenues primarily was a result of an increase in the number of
accommodations leased during the year and a lower occupancy rate due to entering
a new market in August 1995.

Selling, General and Administrative Expense. Selling, general and
administrative expense increased $212,000, or 24.5%, from $866,000 to 1995 to
$1.1 million in 1996. The increase both in dollars and as a percentage of
revenues primarily was a result of increased compensation to the stockholders
and an increase in administrative payroll.

26
<PAGE> 28

BUSINESS

OVERVIEW

BridgeStreet was founded in August 1996, and in the first quarter of 1997
combined by merger five regional providers of flexible accommodation services.
The Company has achieved significant growth in recent years. On a combined
basis, units available for rent increased from 1,041 units on January 1, 1994 to
1,936 units on December 31, 1996, representing a compound annual growth rate of
36%. In addition, pro forma net revenues increased from $18.9 million in 1994 to
$37.6 million in 1996, representing a compound annual growth rate of 41%.

GROWTH STRATEGY

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increase internal revenue growth, cost efficiencies and profitability. Key
elements of the Company's business strategy include:

National Operating Strategy. The Company has begun to implement a national
operating strategy with the following components:

- Adopt Best Practices. The Company will continue reviewing its operations
at the local and regional operating levels in order to identify "best
practices" that can be implemented throughout its operations. Areas where
"best practices" may be utilized include accommodation pricing, occupancy
management and cash flow management. BridgeStreet believes the
implementation of these practices will enable the Company to provide
superior customer service and maximize sales opportunities.

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<PAGE> 30

management and reservation functions. BridgeStreet believes that the
proposed system will enable it to deliver superior customer service, more
efficiently manage its operations and achieve cost savings.

ACQUISITION AND GROWTH STRATEGY

Given the highly fragmented nature of the flexible accommodation services
industry, the Company believes that there are numerous potential acquisition
targets both within markets currently served by the Company and in other major
metropolitan areas. The Company intends to implement an aggressive acquisition
program aimed at (i) expanding into major metropolitan markets not currently
served by the Company and (ii) acquiring other flexible accommodation service
providers in its existing markets to enhance its market position.

In new markets, the Company will target for acquisition one or more leading
local or regional flexible accommodation service providers. Generally, these
companies will be run by successful entrepreneurs, whom BridgeStreet will
endeavor to retain after the acquisitions, and will be of sufficient size to
provide the basis for the Company's future expansion within the new markets.
Each of the Company's acquisition candidates will be expected to demonstrate
potential for increased revenues and profitability. The Company also will
evaluate certain qualitative characteristics of acquisition candidates,
including their reputations in their respective geographic regions, the size and
strength of their customer bases, the quality and experience levels of their
operational management, and their operating histories.

In existing markets, the Company will seek to acquire flexible
accommodation service providers that meet the Company's criteria with respect to
reputation, customer base, management and operating history. Some of the
companies acquired within existing markets will be large enough to retain much
of their own operating and management infrastructures. Other, generally smaller
acquired companies will be combined with BridgeStreet's existing operations to
eliminate redundant functions and improve profitability. Acquisitions in
existing markets should improve revenues and profitability by enhancing regional
brand name recognition and leveraging the economies of scale associated with a
larger business enterprise.

The Company believes that acquisition by BridgeStreet will be attractive to
many smaller independent operators because of (i) the Company's strategy to
create a large, professionally-managed company with national brand name
recognition and a reputation for quality service and customer satisfaction, (ii)
the experience of its officers with industry consolidations, (iii) the Company's
decentralized operating strategy, (iv) the Company's increased visibility and
access to financial resources as a public company, (v) the potential for
increased profitability due to centralized administrative functions, enhanced
systems capabilities and access to increased marketing resources, (vi) the
ability of the acquired companies to participate in the Company's growth and
expansion, and (vii) the strong desire of the owners of many privately-held
companies for liquidity and a return on their investments in their companies.

Based on BridgeStreet's experience in the Combination, BridgeStreet
believes the senior executives of the Founding Companies will be instrumental in
establishing new markets for BridgeStreet and in identifying and completing
future acquisitions. Prior to the Combination, the Founding Companies' senior
executives led their companies' successful expansion into 11 new markets:
Cleveland and Cincinnati, Ohio; Detroit, Michigan; Jackson, Mississippi;
Lexington and Louisville, Kentucky; Milwaukee, Wisconsin; Minneapolis,
Minnesota; Oklahoma City, Oklahoma; Pittsburgh, Pennsylvania; and Washington,
District of Columbia. Several of these executives had leadership roles in
founding and directing the National Interim Housing Network ("NIHN"), the
flexible accommodation services industry's leading trade association. The
Company believes that the visibility of these individuals within NIHN and within
the industry in general will increase the industry's awareness of the Company
and its acquisition program, thereby attracting interest from owners of other
flexible accommodation service companies.

As consideration for future acquisitions, the Company intends to use
various combinations of cash, notes and Common Stock. The consideration paid for
each future acquisition will depend on such factors as the acquired company's
historical operating results and future prospects and the ability of the
acquired company's business to complement the services offered by the Company.
The Company currently has no binding acquisition agreements. The timing, size
and success of the Company's acquisition efforts and the associated

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<PAGE> 31

capital commitments cannot be readily predicted. In the event that no suitable
acquisition candidates exist in a given market, the Company is prepared to enter
a market by establishing a new operation or strategic alliance.

The Company has targeted the following markets within which to expand by
making acquisitions, establishing new operations or arranging strategic
alliances: Atlanta, Boston, Chicago, Dallas, Denver, Houston, Los Angeles, New
York, Philadelphia, Phoenix, San Francisco, Seattle, Tampa, Toronto and
Vancouver. The Company also is considering other markets for expansion. See
"Risk Factors -- Risks Associated with Acquisition Strategy and Planned Rapid
Expansion."

ACCOMMODATIONS AND SERVICES

Accommodations

BridgeStreet offers high-quality, fully-furnished one-, two- and
three-bedroom accommodations that, together with the specialized amenities
offered by the Company, are intended to provide guests with a "home away from
home." BridgeStreet selects its accommodations based on location, general
condition and basic amenities, with the goal of providing accommodations that
meet each guest's particular needs. As a flexible accommodation services
provider, the Company can satisfy client requests for accommodations in a
variety of locations and neighborhoods, including requests for proximity to an
office, school or area attraction, as well as requests for accommodations of
specific types and sizes. The substantial majority of the Company's
accommodations are located within high-quality property complexes that typically
feature in-unit washers and dryers, dedicated parking, and access to fitness
facilities (including, in many cases, pools, saunas and tennis courts). Standard
furnishings typically include, among other things, cable televisions, answering
machines and clock radios. BridgeStreet also is able to customize its
accommodations at a guest's request with items such as office furniture, fax
machines and computers.

The Company's accommodations generally are priced competitively with
all-suite or upscale extended-stay hotel rooms even though, on average, the
Company believes its accommodations are substantially larger. The Company
believes it generally is able to price its accommodations competitively due to
(i) the high quality of its accommodations, (ii) its relatively low operating
cost structure and (iii) its ability to lease accommodations in accordance with
demand and leave unfavorable markets quickly. The length of a guest's stay can
range from a few nights to a few years, with the typical stay ranging from 30 to
45 days.

Corporate Client Services

The Company believes that it provides valuable, cost-effective services to
its corporate clients, many of which have human resource directors, relocation
managers or training directors with significant, national employee lodging
requirements. In particular, the Company aims to relieve its clients of the
administrative burden often associated with relocating employees and/or
providing them with temporary housing. In addition to providing clients with a
diverse range of accommodation types and sizes in a variety of locations, the
Company believes it satisfies its clients' needs for (i) a high degree of local
market knowledge, (ii) special accommodation requests (such as last-minute
location switches), (iii) accurate, customized billing options and (iv) other
ancillary services such as assistance in locating permanent housing and school
systems. The Company believes that existing and potential clients will
increasingly turn to outside providers such as BridgeStreet to satisfy their
employee lodging requirements as their awareness of BridgeStreet and the
flexible accommodation services industry increases.

Guest Services

The Company strives to provide the highest quality of customer service by
coordinating in advance all aspects of a guest's lodging experience. Prior to a
guest's arrival, BridgeStreet arranges to have keys and directions sent to the
guest, along with other information relating to the guest's interests (as
discerned through prior communications), such as literature on local golf
courses or other forms of entertainment. The Company makes at least one
follow-up telephone call to the guest before the guest moves in to ensure that
the guest will feel comfortable in his or her new accommodation from the moment
of arrival. Immediately prior to the

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<PAGE> 32

guest's arrival, BridgeStreet's professional housekeeping staff cleans and
inventories the accommodation to ensure that it is prepared for the guest.

During a guest's stay, BridgeStreet keeps in touch with the guest to
confirm that he or she is satisfied, and to encourage the guest to call whenever
the Company can be of assistance. In addition, the Company maintains a
representative in each city in which it operates to be responsive to guests'
needs. The Company's guest services department offers guests comprehensive
information services before and during their stays to help guests acclimate
themselves to their new surroundings. A guest can obtain information concerning,
among other things, local schools, day care providers and area playgrounds, by
placing a single telephone call. Similarly, the guest services department can
identify local entertainment and cultural events, and help coordinate automobile
rentals, grocery shopping and other miscellaneous activities.

BridgeStreet also oversees the moving-out process. The guest is asked
either to mail the keys to the Company in a self-addressed, stamped envelope or
simply to leave the keys in the accommodation. The guest also is asked to
complete a form evaluating his or her stay, and is encouraged to contact the
Company whenever the guest needs accommodations in other locations where
BridgeStreet provides services. The guest's evaluation form is thoroughly
reviewed, and (if applicable) a copy is sent to the corporate client.

CLIENT BASE

BridgeStreet has a diverse client base composed primarily of domestic
Fortune 1000 corporations, business professionals and professional firms. Among
the Company's clients are Ameritech Corporation, Andersen Consulting, members of
the Baltimore Orioles, Cargill Inc., Ernst & Young LLP, KPMG Peat Marwick LLP,
Maybelline, Inc. and United Healthcare Corporation. The Company's guests include
corporate employees, consultants, legal and accounting professionals, sales
representatives, traveling health care workers, visiting professors,
professional athletes, artistic performers, medical patients and their
relatives, and people between homes. No client accounted for more than 5% of the
Company's pro forma 1996 revenues.

SALES AND MARKETING

BridgeStreet focuses primarily on business-to-business selling. At the
local level, each of the Company's operating subsidiaries has corporate account
specialists that call on local companies (including local branches of regional
or national companies) to solicit business. The account specialist focuses his
or her efforts on the key decision makers at each company responsible for
establishing and administering travel and accommodation policies, typically
human resource directors, relocation managers or training directors. By
aggressively pursuing relationships with potential clients and expanding
services to existing clients, BridgeStreet seeks to become each client's primary
or sole provider of flexible accommodation services nationwide. As its
operations expand, BridgeStreet increasingly will market its nationwide
capabilities to its local corporate clients.

The Company tailors its marketing strategy to the needs of particular
clients. For example, BridgeStreet markets itself to a corporation with
relocating employees by focusing on its ability to situate large families in
houses and apartments with three or more bedrooms, its access to accommodations
in both metropolitan and suburban settings, and its access to accommodations
that allow pets. In contrast, when marketing to a potential corporate client
having consultants in need of short-term housing, the Company emphasizes its
flexible lease terms and its ability to customize an accommodation with
amenities such as office equipment (including computers), additional telephone
lines and other work-related items.

The Company intends to implement an advertising program designed to enhance
the "BridgeStreet" name both inside and outside the flexible accommodation
services industry and broaden its client base. In addition, the Company intends
to promote its brand name by advertising in trade publications, Chamber of
Commerce listings, local visitor magazines and telephone directories, on the
radio and the Internet, and through periodic direct mail campaigns.

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LEASING AGREEMENTS

BridgeStreet leases substantially all of its accommodations through
flexible, short-term leasing arrangements in order to match its supply of
accommodations with client demand. The Company believes that its flexible
leasing strategy allows it to react quickly to changes in market demand for
particular geographic locations and types of accommodations. The Company's
strategy also provides it flexibility to address cyclicality in particular
markets. At June 30, 1997, BridgeStreet's occupancy rate was approximately 92%.
The Company seeks to maintain high occupancy rates by staggering its lease
expiration dates within a geographic area, allowing it to adjust its inventory
of accommodations in a given market to reflect fluctuations in overall demand
and demand for particular types of accommodations.

The Company strives to develop strong relationships with property managers
to ensure that it has a reliable supply of high-quality, conveniently-located
accommodations. The Company believes that it can provide property managers with
numerous direct benefits, including (i) higher overall occupancy levels, (ii)
simplified lease agreements (with one lease often covering numerous individual
units), (iii) convenient, timely payment (with one check for all units under
lease in a complex) and (iv) maintenance by BridgeStreet of the accommodations
it leases.

BridgeStreet leases the furniture for its accommodations on a short-term
basis ordinarily from major furniture rental companies. Furniture leases range
from three to 18 months, but may be terminated by the Company prior to
expiration. Through its short-term furniture leasing approach, the Company is
able to maintain well-appointed, modern and attractive accommodations, upgrade
and replace furniture as needed and satisfy specific furnishing requests.

PROPERTIES

BridgeStreet leases all of its accommodations (with the exception of 19
condominium units which are owned). The Company has no plans to purchase or own
any additional properties. The Company's accommodations include one-, two- and
three-bedroom apartments, condominiums, townhouses, and, to a lesser extent,
houses. As of June 30, 1997, the Company had approximately 2,700 accommodations
under lease, with lease terms generally ranging from one to 18 months. The
following table indicates as of that date the number of units under lease in
each metropolitan area in which BridgeStreet operates:

<TABLE>
<CAPTION>
50 OR FEWER 51 TO 150 GREATER THAN 150
----------- --------- ----------------
<S> <C> <C>
Canton, OH Akron, OH Baltimore, MD
Detroit, MI* Cincinnati, OH Cleveland, OH
Oklahoma City, OK* Jackson, MS Columbus, OH
Lexington, KY Memphis, TN
Louisville, KY Minneapolis/St. Paul, MN**
Milwaukee, WI Pittsburgh, PA**
Washington, DC
</TABLE>

- ---------------

* BridgeStreet has operated in this metropolitan area for less than 12 months.

** The operations of two Founding Companies have been integrated in this
metropolitan area.

INDUSTRY OVERVIEW

United States Lodging Industry Overview

According to Smith Travel Research, in 1996, the United States lodging
industry posted record profits of approximately $12.5 billion and hotel
occupancies reached 65%, representing their highest level since 1982; and the
United States lodging industry is estimated to have generated approximately
$56.3 billion in annual room revenues in 1996 and, at December 31, 1996, had
overall supply of approximately 3.4 million rooms per night.

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The Company believes that the domestic lodging industry has benefited from
a gradually improving supply and demand balance, evidenced by increasing average
daily room and occupancy rates in recent years. Room supply growth in the
lodging industry slowed in the early 1990s and has rebounded in recent years,
but demand nonetheless continues to grow faster than supply. According to Smith
Travel Research, supply growth was 0.3% in 1993, 1.0% in 1994, 1.2% in 1995 and
2.1% in 1996. This slow supply growth, coupled with 1.7%, 3.0%, 1.7% and 2.3%
increases in demand (measured by occupied rooms) in 1993, 1994, 1995 and 1996,
respectively, reflects an improved supply and demand balance in the industry.

The Company believes that new hotels and lodging concepts are emerging to
compete with older hotels by offering newer and more contemporary facilities.
New concepts in the lodging industry are focusing more closely on customer needs
and are offering modern amenities such as microwave ovens, voice mail and
computers.

Lodgings for Stays of Three Nights or Longer

According to the American Hotel and Motel Association, in 1995 guests
staying three or more consecutive nights in a hotel accounted for more than 37%
of all hotel rooms rented. Based on 1995 room demand of 3.4 million rooms per
night, this data shows an implied demand of nearly one million rooms for such
stays. According to Smith Travel Research, extended-stay hotels currently offer
approximately 58,000 rooms per night.

The demand for guest stays of three or more consecutive nights has resulted
in the following accommodation concepts:

All-Suite Hotels. All-suite hotels constitute a relatively new segment of
the lodging industry, having developed largely over the past 10 years. All-suite
hotels were developed partially in response to the increasing number of
corporate relocations, transfers and temporary assignments, and principally are
oriented toward business travelers willing to pay rates in the mid- to
upper-price levels. All-suite hotel rooms are larger than traditional hotel
rooms and, in some cases, contain efficiency kitchens. All-suite hotels
typically offer discounts to guests staying for extended periods.

Extended-Stay Hotels. Extended-stay hotels are an extension of the
all-suites concept, generally providing more space, rooms and "home-like"
conveniences to the traveler. Extended-stay hotel units typically are larger
than traditional hotel rooms and, in some cases, include kitchen facilities with
a stove, refrigerator and microwave, a work desk, laundry facilities, and a
separate bedroom. According to Smith Travel Research, from 1992 through 1996,
the compound annual growth rate in occupied rooms in extended-stay hotels was
approximately 10.1%, compared to approximately 1.8% for the overall domestic
lodging industry, while the compound annual growth rate in room supply in such
hotels was approximately 9.6%, compared to approximately 0.9% for the overall
domestic lodging industry.

Flexible Accommodation Service Providers. Flexible accommodation service
providers utilize a substantially different business model than fixed-location
providers (such as all-suite and extended-stay hotels) with respect to sourcing
of inventory (i.e., accommodations and furnishings), unit economics, and sales
and marketing. Companies in the flexible accommodation services industry
typically do not own real estate but instead lease apartments, condominiums,
townhouses and even houses on a short-term basis. These companies then rent the
leased accommodations, primarily for business travelers. The Company believes
that growth in the flexible accommodation services industry, evidenced by a
17.9% compound annual growth rate in total room revenue over the past ten years,
is attributable to an increased demand by travelers on extended trips for
accommodations that better approximate their everyday living environment.
Accommodations in this segment typically are the most "home-like" in the lodging
industry, offering full-sized, fully-equipped kitchens, bedrooms, bathrooms and
living rooms. Flexible accommodation service providers focus primarily on
employees in the corporate workforce, from entry-level to executive. Due to
their short-term leasing strategy, flexible accommodation service providers are
less capital- and labor-intensive, and have a more variable cost structure, than
fixed-location providers.

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The industry information in this Prospectus for which Smith Travel Research
and the American Hotel and Motel Association are the indicated sources is
publicly-available. Smith Travel Research has consented to be named as the
source of the information attributed to it; such consent has not been sought
from the American Hotel and Motel Association.

COMPETITION

Flexible accommodation service providers compete primarily on the basis of
location, availability, price and quality of accommodations, quality and scope
of service and brand name recognition. The Company believes that, while it
currently competes against all lodging providers, in the future its primary
competition will come from other flexible accommodation service providers and,
to a lesser extent, all-suite hotels and upscale extended-stay hotels. The
Company intends to compete by maintaining a loyal customer base and offering a
client-oriented approach with convenient locations, large and high-quality
customized accommodations, and personalized customer service.

The Company expects its business to become more competitive as existing
competitors expand and additional companies enter the flexible accommodation
services industry. The Company believes that the largest providers of flexible
accommodation services currently are Oakwood, Gables Corporate Accommodations,
Accommodations America, Inc., ExecuStay Corporation and Globe Furniture Rentals,
Inc., some of which are larger (in terms of number of available accommodations)
than BridgeStreet. Certain of the Company's existing competitors have, and any
new competitors that enter the industry may have, access to significantly
greater resources than the Company. In particular, Oakwood is affiliated with
R&B Realty Group, the nation's tenth largest apartment management company. This
affiliation gives Oakwood access to apartment communities and capital that may
be unavailable to the Company. See "Risk Factors -- Competition."

REGULATION AND TAX

The Company is subject to employment laws, including minimum wage,
overtime, working condition and work permit requirements. The Company believes
that it is in compliance with all applicable employment laws, and intends to
continue to comply with such laws.

In addition, the Company is subject to the Americans with Disabilities Act
(the "ADA") as a private entity providing public accommodations. All public
accommodations are required to meet certain federal requirements related to
access and use by disabled persons. While the Company believes that all of the
units it leases are substantially in compliance with these requirements, a
determination that such units are not in compliance with the ADA could result in
the imposition of fines or an award of damages to private litigants.

As a lessee of its accommodations, BridgeStreet believes that it and its
employees are either outside the purview of, exempted from or in compliance with
laws in the jurisdictions in which the Company operates requiring real estate
brokers to hold licenses. However, there can be no assurance that the Company's
position in any jurisdiction where it believes itself to be excepted or exempted
would be upheld if challenged or that any such jurisdiction will not amend its
laws to require the Company and/or one or more of its employees to be licensed
brokers. Moreover, there can be no assurance that the Company will not operate
in the future in additional jurisdictions requiring such licensing. See "Risk
Factors -- Licensing and Tax Issues."

In some of the jurisdictions in which the Company operates, the Company
believes that it is not required to charge the sales and "bed" taxes that are
applicable to establishments furnishing rooms to transient guests. There can be
no assurance, however, that the tax laws in particular jurisdictions will not
change or that a tax collection agency will not successfully challenge the
Company's position regarding the applicability of such taxes. See "Risk Factors
- -- Licensing and Tax Issues." The Company believes that it properly charges and
remits such taxes in all jurisdictions where it is required to do so.

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INSURANCE

The Company purchases general liability, comprehensive property damage,
automobile, workers' compensation and other insurance coverages that management
considers adequate for the protection of the Company's assets and operations,
although there can be no assurance that the coverage limits of such policies
will be adequate. A successful claim against the Company beyond the scope of its
insurance coverage or in excess of its limits could have a material adverse
effect on the Company's business, financial condition and results of operations.
Claims against the Company, regardless of their merit or outcome, also may have
an adverse effect on the Company's reputation and business.

INTELLECTUAL PROPERTY

The Company has filed an application with the United States Patent and
Trademark Office to register the service mark "BridgeStreet."

HEADQUARTERS AND REGIONAL OFFICES

The Company's corporate headquarters is located in Solon, Ohio and is
occupied pursuant to a lease that expires in July 2000. The Company has the
option to extend the lease for an additional three years. In addition, the
Company currently leases regional offices in Columbus, Ohio; Hudson, Ohio;
Baltimore, Maryland; Memphis, Tennessee; and Minneapolis, Minnesota.

EMPLOYEES

As of June 30, 1997 the Company had approximately 300 full-time employees
and approximately 10 part-time employees. BridgeStreet expects that it will
increase the number of its employees as it expands its business. The Company's
employees are not subject to any collective bargaining agreements, and
management believes that its relationship with its employees is good.

LEGAL PROCEEDINGS

The Company is from time to time a party to litigation arising in the
ordinary course of business. There can be no assurance that the Company's
insurance coverage will be adequate to cover all liabilities arising out of such
litigation. Management believes that any liability that the Company might incur
upon the resolution of any existing litigation will not have a material adverse
effect upon the Company's business, financial condition and results of
operations.

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MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information as of June 30, 1997 concerning
the Company's current directors, executive officers and director nominees. The
director nominees have agreed to become directors of the Company upon the
closing of this offering.

<TABLE>
<CAPTION>
NAME AGE CURRENT POSITIONS
---------------------------------------------------- --- ----------------------------
<S> <C> <C>
William N. Hulett, III.............................. 53 President, Chief Executive
Officer and Director
Rocco A. Di Lillo................................... 45 Vice President, Chief
Operating Officer and
Director
Mark D. Gagne, CPA.................................. 36 Chief Financial Officer and
Treasurer
Paul M. Verrochi.................................... 48 Chairman of the Board
James M. Biggar..................................... 68 Director nominee
Lynda D. Clutchey................................... 39 Director
Robert R. Mesel..................................... 61 Director nominee
Connie F. O'Briant.................................. 38 Director
Melanie R. Sabelhaus................................ 48 Director
Jerry Sue Thornton.................................. 50 Director nominee
</TABLE>

William N. Hulett, III has been President, Chief Executive Officer and a
director of the Company since January 1997. He also is Chief Executive Officer
and sole director of each of the Company's wholly-owned subsidiaries. Prior to
the commencement in June 1997 of his employment with the Company under his
employment agreement, Mr. Hulett served from January 1997 through May 1997 as a
consultant to the Company. Mr. Hulett's career in the hotel industry has spanned
33 years, from 1960 to 1993. During 21 years with Westin Hotels (from 1960 to
1981), Mr. Hulett managed some of the finest hotels in America, including the
St. Francis in San Francisco and The Mayflower in Washington, D.C., served as
the Managing Director for all Westin Hotels in Hawaii, and also served as Vice
President for Operations and Development, during which time he built the Westin
in Cincinnati and the Westin O'Hare in Chicago. In 1981, Mr. Hulett joined the
Nestle Corporation as President of the Stouffer Hotel Company ("Stouffer").
During his 12 years as President of Stouffer, he built, acquired or joint
ventured over 35 hotels. In 1993, when Stouffer was sold, he devoted his time to
fund raising and building the Rock and Roll Hall of Fame and Museum, which
opened in Cleveland, Ohio in 1995. He served as its Chairman and Chief Executive
Officer until joining BridgeStreet in 1997. Mr. Hulett is a director of the
Travel Industry Association of America and of Developers Diversified Realty
Corporation, and has served the American Hotel and Motel Association in various
capacities, including Vice Chairman of its Educational Institute.

Rocco A. Di Lillo has been Vice President, Chief Operating Officer and a
director of the Company, and President and Chief Operating Officer of one of the
Company's five operating subsidiaries, since January 1997. Mr. Di Lillo also is
President of City Visitor Publications, Inc., a leading publisher of travel and
visitor guides in the Midwest. Until the Combination in January 1997, Mr. Di
Lillo was President and sole director of CLI, which he founded in March 1987,
and which expanded into 10 Midwest cities in six states. Mr. Di Lillo was named
1997 Ohio Entrepreneur of the Year for service companies. Mr. Di Lillo is a
charter member of NIHN, the flexible accommodation services industry's leading
trade association.

Mark D. Gagne, CPA, has been Chief Financial Officer and Treasurer of the
Company since January 1997. From January 1996 until January 1997, Mr. Gagne was
a consultant to ABP. Previously, from February 1992 to December 1995, Mr. Gagne
was Chief Financial Officer and Treasurer of CMG Information Services Inc. and
subsidiaries, a publicly traded group of direct marketing services, fulfillment
services and information/internet technologies companies. From April 1988 to
January 1992, Mr. Gagne was Vice President and Chief Financial Officer of the
Trodella Companies, three privately held construction services companies. From

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<PAGE> 38

1982 to 1988, Mr. Gagne served in a number of positions as a Certified Public
Accountant for Kennedy & Lehan, P.C. and Arthur Andersen LLP.

Paul M. Verrochi has been Chairman of the Board of Directors of the Company
since August 1996. In 1992, Mr. Verrochi co-founded American Medical Response,
Inc. ("AMR"), which prior to its acquisition was a publicly held company and the
largest national provider of ambulance services. From August 1992 to January
1996, Mr. Verrochi served as AMR's President and Chief Executive Officer, and
until January 1997 he also served as the Chairman of the Board of Directors. Mr.
Verrochi was selected as the 1995 National Entrepreneur of the Year for Emerging
Growth Companies by Inc. Magazine. Mr. Verrochi serves as an advisory board
member to numerous charitable foundations, including the New England Aquarium
and the Boston Symphony Orchestra. Mr. Verrochi also is Chairman of ABP and a
director of Coach USA, Inc., a publicly held company.

James M. Biggar will become a director of the Company upon consummation of
this offering. Mr. Biggar has been Chairman and Chief Executive Officer of
Glencairn Corporation, a real estate development company, since July 1991. From
1960 to July 1991, Mr. Biggar served in various positions with subsidiaries of
Nestle SA and the Stouffer Corporation (which was acquired by Nestle SA in
1973), including Director of Marketing, Vice President and Chief Executive
Officer of the Stouffer Corporation, President, Chief Executive Officer and
Chairman of Nestle Enterprises, Inc. and Chairman of Nestle USA, Inc. Mr. Biggar
is a director of The Sherwin-Williams Company and ESSEF Corporation.

Lynda Clutchey has been a director of the Company, and President and Chief
Operating Officer of one of the Company's five operating subsidiaries, since
January 1997. Until January 1997, Ms. Clutchey was President and a director of
TCH, which she co-founded in August 1983. Prior to co-founding TCH, Ms. Clutchey
served in the United States Peace Corps, working with an agricultural marketing
cooperative in the Philippines. Ms. Clutchey is a charter member of NIHN and
served on its Board of Directors from its inception in 1990 through 1994.

Robert R. Mesel will become a director of the Company upon consummation of
this offering. Mr. Mesel recently retired from BP Chemicals, Inc., where from
January 1991 he had served as President and Chief Executive. From June 1994, he
also had served as Chief Executive, Bulk Chemicals Division (London). Prior to
joining BP Chemicals, Inc., Mr. Mesel had been Vice President, Administration of
BP America, Inc. from October 1989 until January 1991, and Vice President,
Corporate Control of Standard Oil from July 1985 until October 1989. Previously,
from May 1980 to July 1985, Mr. Mesel was President of Chase Brass, a
manufacturing company. Mr. Mesel has served on many local community and
charitable boards, as well as the Board of Regents and the Board of Trustees for
Canisius College.

Connie F. O'Briant has been a director of the Company, and President and
Chief Operating Officer of one of the Company's five operating subsidiaries,
since January 1997. Until January 1997, Ms. O'Briant was President and a
director of THEI, which she co-founded in May 1991. Active in civic and
relocation industry efforts, THEI is involved in the Executive Newcomer's
Committee, the Memphis Area Chamber of Commerce and the Mid-South Relocation
Council. THEI received the Memphis Business Journal's "Memphis Business of the
Year" Small Business Award in 1994. Ms. O'Briant is a member of the President's
Council of United American Bank and an investment partner of Junior Achievement.
Ms. O'Briant also is a member of NIHN and served on its Board of Directors from
1995 to 1996.

Melanie R. Sabelhaus has been a director of the Company, and President and
Chief Operating Officer of one of the Company's five operating subsidiaries,
since January 1997. Until January 1997, Ms. Sabelhaus was President and a
director of EIP, which she founded in June 1987. Prior to founding EIP, Ms.
Sabelhaus spent 17 years in various sales and management positions at IBM. Ms.
Sabelhaus was listed in the Women's Top 100 of Maryland 1996, and also was
honored by the Baltimore Business Journal in 1995 for operating one of the top
25 women-owned businesses in that city. Ms. Sabelhaus is a charter member of
NIHN.

Jerry Sue Thornton, Ph.D. will become a director of the Company upon
consummation of this offering. Dr. Thornton has been President of Cuyahoga
Community College, the largest community college in Ohio, since 1992.
Previously, from 1985 to 1992, Dr. Thornton had been President of Lakewood
Community College

37
<PAGE> 39

in White Bear Lake, Minnesota. Dr. Thornton is a director of Applied Industrial
Technologies, Inc. and National City Bank (Cleveland), and of several non-profit
organizations, including the Greater Cleveland Growth Association, the Urban
League of Greater Cleveland and United Way Services.

Officers of the Company serve at the pleasure of the Board of Directors,
subject to the terms of any employment agreements with the Company. The term of
office of each director of the Company ends at the next annual meeting of the
Company's stockholders or when his successor is elected and qualified.

COMMITTEES OF THE BOARD OF DIRECTORS

Upon or prior to the closing of this offering, the Company will establish
an Audit Committee and Compensation Committee. The Audit Committee, a majority
of which will be independent directors, will make recommendations concerning the
engagement of independent public accountants, review with the independent public
accountants the plans for and results of the Company's annual audit, approve
professional services provided by and the independence of the independent public
accountants, consider the range of audit and non-audit fees and review the
adequacy of the Company's internal accounting controls. The Compensation
Committee, a majority of which will be independent directors, will establish a
general compensation policy for the Company, approve increases in directors'
fees and salaries paid to officers and senior employees of the Company,
administer the Company's 1997 Equity Incentive Plan and Stock Plan for
Non-Employee Directors, and determine, subject to the provisions of the
Company's employee benefit plans, the directors, officers and employees of the
Company eligible to participate in any of the plans, the extent of such
participation and terms and conditions under which benefits may be vested,
received or exercised.

DIRECTOR COMPENSATION

Members of the Board of Directors who also serve as officers of the Company
or its subsidiaries do not receive compensation for serving on the Board. Each
other member of the Board will receive a fee of $2,000 for each Board of
Directors meeting attended and an additional fee of $1,000 for each committee
meeting attended, except that $500 will be paid for each committee meeting
attended on the same date as a Board meeting. All directors will receive
reimbursement of reasonable expenses incurred in attending Board and committee
meetings and otherwise carrying out their duties.

The Company's Board of Directors has adopted the Stock Plan for
Non-Employee Directors (the "Directors' Plan"). Subject to adjustment for stock
splits and similar events, a total of 100,000 shares of Common Stock are
reserved for issuance under the Directors' Plan. Pursuant to the Directors'
Plan, on the date of this Prospectus, each director who is neither an employee
of the Company or one of its subsidiaries nor a holder of five percent or more
of the Company's Common Stock (a "non-employee director") will receive an option
to purchase 12,500 shares of Common Stock with a per-share exercise price equal
to the initial public offering price. Thereafter, each such non-employee
director will be granted, on every third anniversary of this Prospectus
(provided he or she still is a non-employee director at such time), an option to
acquire an additional 7,500 shares of Common Stock. Each non-employee director
initially elected following this offering will be granted upon such election an
option to purchase 7,500 shares of Common Stock, and thereafter will be granted,
immediately following every third anniversary of such election provided he or
she still is a non-employee director at such time (or third annual meeting at
which such non-employee director is reelected, if the director initially was
elected at an annual meeting) an option to acquire an additional 7,500 shares of
Common Stock. The exercise price of options granted following this offering will
be the fair market value of the Common Stock on the date of grant. Each option
will be non-transferable except upon death (unless otherwise approved by the
Board), will expire 10 years after the date of grant and will become exercisable
with respect to one-third of the shares of Common Stock issuable thereunder on
each of the first three anniversaries of the date of grant if the individual is
a director at such time. If the director dies or otherwise ceases to be a
director prior to the expiration of an option, the option (if exercisable) will
remain exercisable for a period of one year (following death) or three months
(following other termination of the individual's status as a director), but in
no event beyond the tenth anniversary of the date of grant. The Board of
Directors may at any time or times amend the Directors' Plan for any purpose
that at the time may be permitted by law.

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<PAGE> 40

As of the date of this Prospectus, options to purchase 37,500 shares of
Common Stock have been granted under the Directors' Plan.

EXECUTIVE COMPENSATION

The Company did not pay any compensation to its executive officers in 1996.

Equity Incentive Plan

The Company has adopted the 1997 Equity Incentive Plan (the "Equity
Incentive Plan"), which provides for the award ("Award") of up to 1,000,000
shares of Common Stock in the form of incentive stock options ("ISOs"),
non-qualified stock options, stock appreciation rights, performance shares,
restricted stock or stock units. All directors and employees of, and all
consultants and advisors to, the Company (including its subsidiaries) are
eligible to participate in the Equity Incentive Plan.

The Equity Incentive Plan will be administered by the Compensation
Committee (the "Committee"), which determines who shall receive Awards from
those individuals eligible to participate in the Equity Incentive Plan, the type
of Award to be made, the number of shares of Common Stock that may be acquired
pursuant to the Award and the specific terms and conditions of each Award,
including the purchase price, term, vesting schedule, restrictions on transfer
and any other conditions and limitations applicable to the Awards or their
exercise. Options that are ISOs may be exercisable for not more than 10 years
after the date the option is awarded. The Committee may at any time accelerate
the exercisability of all or any portion of an option.

In the event of a merger or consolidation in which the Company is not the
surviving corporation or which results in the acquisition of substantially all
the Company's outstanding shares of capital stock, or in the event of the sale
or transfer of substantially all of the Company's assets, if the Committee so
determines, all outstanding Awards will terminate, provided that on or before 20
days prior to the proposed effective date of any such transaction, the Committee
either (i) makes all outstanding Awards exercisable prior to the consummation of
the transaction or (ii) arranges for the surviving or acquiring corporation, if
any, to grant to participants replacement Awards.

The Equity Incentive Plan may be amended from time to time by the Board of
Directors or terminated in its entirety; however, no amendment may be made
without stockholder approval if such approval is necessary to comply with any
applicable tax or regulatory requirement.

Options to Purchase Shares of Common Stock

Messrs. Hulett, Di Lillo and Gagne have been awarded options under the
Equity Incentive Plan, effective as of the date of this Prospectus, to purchase
150,000, 75,000 and 75,000 shares of Common Stock, respectively. Each option (i)
has a per share exercise price equal to the initial public offering price, (ii)
becomes exercisable with respect to one-third of the shares issuable thereunder
on each of the first three anniversaries of the closing of this offering and
(iii) expires 10 years from the date of grant. With respect to Messrs. Hulett
and Gagne, upon the effectiveness of a change in control (as defined in their
employment contracts), the stock option granted to each of them will become
exercisable in full. In addition, if the Company fails to continue Mr. Hulett's
employment following the term of his employment contract for a reason other than
for cause (as defined) or disability, then all options held by Mr. Hulett at
such time will become exercisable in full. See "--Employment Contracts."

In addition to the options granted to Messrs. Hulett, Di Lillo and Gagne,
the Company has awarded options under the Equity Incentive Plan, effective as of
the date of this Prospectus, to purchase an aggregate of 170,667 shares of
Common Stock, with each such option having a per share exercise price equal to
the initial public offering price.

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<PAGE> 41

Employment Contracts

The Company has entered into employment agreements with its executive
officers, the material terms of which are summarized below.

Mr. Hulett has an employment contract ending May 31, 2000 to serve as the
Company's Chief Executive Officer and President. Under this contract, Mr. Hulett
will receive a base salary of $200,000, subject to discretionary increases and
also subject to specified increases if the Company achieves budgeted net
earnings per share. Mr. Hulett also may receive a bonus of up to 50% of his base
salary based on performance goals and other criteria. Mr. Hulett has agreed not
to compete with the Company for a period of two years following termination of
his employment. From January through May 1997, Mr. Hulett served as a consultant
to the Company pursuant to a consulting agreement.

Mr. Gagne has an employment contract ending May 31, 2000 to serve as the
Company's Chief Financial Officer. Under this contract, Mr. Gagne will receive a
base salary of $125,000, subject to discretionary increases, and a bonus of up
to 40% of his base salary based on performance goals and other criteria. Under
certain circumstances, Mr. Gagne will receive as severance three months' salary,
six months' benefits and a pro rata portion of his bonus payment, if payable. In
the event of a change in control (as defined), Mr. Gagne may terminate the
contract and receive one year's salary and a pro rata portion of his bonus, if
payable. Mr. Gagne has agreed not to compete with the Company for a period of
two years following termination of his employment.

Mr. Di Lillo has an employment contract ending January 2, 2000. Under this
contract, Mr. Di Lillo will receive a base salary of $125,000, subject to
discretionary increases, and a bonus of up to 40% of his base salary based on
performance goals and other criteria. The contract may be terminated by the
Company without cause upon the approval of two-thirds of the Company's Board of
Directors. Mr. Di Lillo is subject to the non-competition provisions described
in "Certain Transactions--Organization of the Company; The Combination."

LIMITATION OF CERTAIN LIABILITY OF OFFICERS AND DIRECTORS

As permitted by the DGCL, the Company's Certificate of Incorporation
provides for the elimination, subject to certain conditions, of the personal
liability of directors of the Company for monetary damages for breach of their
fiduciary duties. The directors, however, remain subject to equitable remedies.
The Company's Certificate of Incorporation also provides that the Company will
indemnify its directors and officers. In addition, the Company maintains an
indemnification insurance policy covering all directors and officers of the
Company. In general, the Company's Certification of Incorporation and the
indemnification insurance policy attempt to provide the maximum protection
permitted by Delaware law with respect to indemnification of directors and
officers.

Under the indemnification provisions of the Company's Certificate of
Incorporation and the indemnification insurance policy, the Company will repay
certain expenses incurred by a director or officer in connection with any civil
or criminal action or proceeding, and specifically including actions by or in
the name of the Company (derivative suits), where the individual's involvement
is by reason of the fact that he or she is or was a director or officer of the
Company. Such indemnifiable expenses include, to the maximum extent permitted by
law, attorney's fees, judgments, civil or criminal fines, settlement amounts,
and other expenses customarily incurred in connection with legal proceedings. A
director or officer will not receive indemnification if he or she is found not
to have acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Company.

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<PAGE> 42

PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock, as of June 30, 1997 and as adjusted to
reflect the sale of shares of Common Stock by the Selling Stockholders, of (i)
each director and director nominee of the Company, (ii) certain executive
officers of the Company, (iii) all directors and executive officers as a group,
(iv) each person or entity known to the Company to beneficially own more than 5%
of the outstanding Common Stock and (v) the Selling Stockholders. Except as
indicated in the footnotes below, the persons named in this table have sole
investment and voting power with respect to the shares beneficially owned by
them.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES TO BE
OWNED PRIOR SHARES TO BENEFICIALLY OWNED
TO OFFERING(1) BE SOLD AFTER OFFERING(1)
----------------------- IN ---------------------
NUMBER PERCENT OFFERING NUMBER PERCENT
--------- ------- --------- --------- -------
<S> <C> <C> <C> <C> <C>
William N. Hulett, III............... 175,000 3.2% -- 175,000 2.4%
Rocco A. Di Lillo(2)................. 810,851 14.8 200,000 610,851 8.5
Mark D. Gagne........................ 81,400 1.5 -- 81,400 1.1
Paul M. Verrochi(2).................. 300,500(3) 5.5 -- 300,500 4.2
James M. Biggar...................... -- -- -- -- --
Sandra A. Brown(2)(4)................ 475,000 8.7 95,000 380,000 5.3
Lynda D. Clutchey(2)................. 1,537,285(5) 28.1 320,000(6) 1,217,285 17.0
Robert R. Mesel...................... -- -- -- -- --
Connie F. O'Briant(2)................ 391,408(7) 7.1 100,000 291,408 4.1
Melanie R. Sabelhaus(2).............. 901,805(8) 16.9 200,000 701,805 9.8
Jerry Sue Thornton, Ph.D............. -- -- -- -- --
SLD Partnership(9)................... 1,489,395 27.2 320,000 1,169,395 16.3
All directors, director nominees and
executive officers as a group (10
persons)........................... 4,198,249(10) 76.7 820,000 3,378,249 47.1
</TABLE>

- ---------------

(1) Percentages are based upon 5,475,000 shares of Common Stock outstanding on
June 30, 1997 and 7,175,000 shares of Common Stock outstanding as of the
closing of this offering, respectively.

(2) The stockholder's address is c/o BridgeStreet Accommodations, Inc., 30670
Bainbridge Road, Solon, Ohio 44139.

(3) Includes 150,250 shares of Common Stock held in a trust for the benefit of
Mr. Verrochi's children, with respect to which Mr. Verrochi disclaims
beneficial ownership.

(4) Ms. Brown is President and Chief Operating Officer of one of the Company's
operating subsidiaries. Prior to the Combination, she was a senior
executive officer of Home Again.

(5) Consists of (i) 47,890 shares of Common Stock held jointly with Ms.
Clutchey's spouse and (ii) 1,489,395 shares of Common Stock held by SLD
Partnership, an Ohio general partnership, with respect to which Ms.
Clutchey shares voting and investment power. Ms. Clutchey and each of two
of her siblings owns a one-third interest in SLD Partnership.

(6) Represents shares of Common Stock being offered by SLD Partnership in this
offering.

(7) Includes 191,790 shares of Common Stock held by Ms. O'Briant's spouse, as
to which shares Ms. O'Briant disclaims beneficial ownership.

(8) Includes 18,250 shares of Common Stock held by Ms. Sabelhaus' spouse, as to
which shares Ms. Sabelhaus disclaims beneficial ownership.

(9) The address of SLD Partnership is 1515 Bethel Road, Columbus, Ohio 43220.

(10) See Notes 3, 5, 7 and 8 above.

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<PAGE> 43

CERTAIN TRANSACTIONS

ORGANIZATION OF THE COMPANY

Start-Up Funding

The Company was initially capitalized in August 1996 with an aggregate of
$2,000 provided by Messrs. Verrochi, Donald W. Glazer, Joseph E. Palmer, Dominic
J. Puopolo and Michael L. Stark. As a result of a 499-for-1 stock split in
November 1996 (and following certain subsequent transfers), these individuals
currently beneficially own 818,140 shares of Common Stock in the aggregate.

ABP

Mr. Verrochi, Chairman of the Company, is a principal and Chairman of ABP,
and Mr. Glazer, Secretary of the Company, is a principal of ABP. The expenses
incurred by the Company in connection with the Combination and this offering
(estimated at approximately $2.2 million) will be paid by ABP, and the Company
will reimburse ABP out of the proceeds of this offering. See "Use of Proceeds."
As of March 31, 1997, ABP had advanced approximately $500,000 on an
interest-free basis on behalf of the Company for such expenses.

ABP has also agreed to assist the Company to complete future acquisitions
if the Company so requests. Under the agreement between the parties, which is
terminable at will by either party, ABP will receive from the Company in cash 1%
of the transaction value of acquisitions for which ABP at the Company's request
provides assistance. ABP also will be reimbursed for all direct expenses
incurred by ABP in connection with such acquisitions.

The Combination

In connection with the Combination, the Company acquired all of the issued
and outstanding capital stock of the Founding Companies. See "Combination." The
aggregate consideration paid by the Company in the Combination was 4,301,000
shares of Common Stock. Of this amount, individuals who are executive officers
and/or directors of the Company received the following: Mr. Di Lillo, 835,901
shares; Ms. Sabelhaus, 1,001,805 shares (including shares issued to her spouse);
Ms. O'Briant, 391,408 shares (including shares issued to her spouse); and Ms.
Clutchey, 1,537,285 shares (including shares issued to a general partnership in
which each of Ms. Clutchey and two of her siblings holds a one-third interest).
See "Principal and Selling Stockholders." Pursuant to the terms of the
agreements by which their Founding Companies were merged into the Company, each
of Mr. Di Lillo, Ms. Sabelhaus, Ms. O'Briant and Ms. Clutchey were designated
directors of the Company.

Each of Ms. Sabelhaus, Ms. O'Briant and Ms. Clutchey has entered into an
employment agreement with the Company which provides for an initial base salary
of $100,000, subject to upward adjustment in the sole discretion of the
Company's Board of Directors, and participation in the Company's bonus and
benefit plans. The employment agreements expire on January 2, 2000 but may be
terminated earlier in the event of disability, for cause (as defined) or without
cause by the approval of two-thirds of the Company's Board of Directors. Mr. Di
Lillo also entered into an employment agreement in connection with the
Combination. See "Management -- Executive Compensation; Employment Contracts."

Each of Mr. Di Lillo, Ms. Sabelhaus, Ms. O'Briant and Ms. Clutchey has
agreed not to compete with the Company until January 2, 2002 or, if later, three
years from the date of termination of employment by the Company (regardless of
the reason therefor).

TRANSACTIONS INVOLVING OFFICERS AND DIRECTORS

As a result of the Combination, the Company assumed the obligations of TCH
under a three-year contract, effective January 1, 1996, with Saturn Enterprises,
Inc. ("Saturn"), a corporation of which David Clutchey III is the sole
stockholder. Mr. Clutchey is the husband of Lynda Clutchey, a director of
BridgeStreet. Pursuant to the contract, TCH leased from Saturn on a
non-exclusive basis televisions, VCRs,

42
<PAGE> 44

and microwave ovens. In 1994, 1995 and 1996, TCH paid or accrued expenses under
this contract of approximately $11,200, $47,400 and $107,300, respectively. The
Company has no obligation to lease equipment under the contract, but may
continue to do so. BridgeStreet believes that the terms of this contract are no
less favorable than could be obtained from non-affiliated parties.

The Company also assumed TCH's obligations under an exclusive lease
agreement with Integrity Furniture, Inc., a company which is 49% owned by SLD
Partnership ("SLD"), an Ohio general partnership in which Ms. Clutchey and two
of her siblings each have a one-third interest. The agreement was entered into
on September 12, 1995, has a five-year term and provides that the lessor has the
exclusive right to furnish all of the Company's leased accommodations in
Pittsburgh, Pennsylvania at agreed-upon prices. The initial unit lease terms are
for minimum three-month periods that then are renewable monthly. The Company
believes that the lease terms are no less favorable than could be obtained from
non-affiliated parties. The rental amounts under this contract totalled
approximately $213,000 during 1996.

On October 15, 1995, TCH loaned to SLD $45,000, at an annual interest rate
of 7% beginning November 1995. Also in 1995 SLD borrowed $109,602 from TCH. Both
of these notes were repaid in full during 1996.

Stephen and David Holzer performed consulting services for TCH from June
1992 until November 1996. For such services, each earned $48,000 per year during
1994, 1995 and 1996. The Holzers are brothers of Ms. Clutchey and general
partners of SLD Partnership. The consulting agreements were terminated in
November 1996.

As a result of the Combination, the Company assumed the obligation of EIP
to repay the outstanding balance borrowed to finance certain working capital
requirements under a personal line of credit maintained by Melanie R. Sabelhaus.
The outstanding balance bears interest at a rate of 8.25%. The Company will
repay the outstanding balance from the net proceeds of this offering, together
with accrued interest at a rate equal to the rate under the line of credit. See
"Use of Proceeds." As of June 30, 1997, the outstanding balance was
approximately $11,000.

In February 1997, Thomas W. O'Briant loaned one of the Company's operating
subsidiaries $50,000 to satisfy working capital requirements. The loan bears
interest at a rate of 8.0%, and all outstanding principal and interest under
such loan will be repaid by the Company from the net proceeds of this offering.
See "Use of Proceeds." As of June 30, 1997, this loan had an outstanding
principal balance of approximately $41,000. Mr. O'Briant is the husband of
Connie F. O'Briant, a director of the Company.

CLI performed certain general and administrative services (e.g., accounting
services) for City Visitor, an entity which publishes a travel magazine and is
100% owned by Mr. Di Lillo. For services during 1994, 1995 and 1996, City
Visitor paid CLI approximately $42,000, $51,000 and $15,000, respectively. City
Visitor sold advertising space in its magazine to CLI during these years, and
was paid, respectively, approximately $34,000, $22,000 and $31,000. Following
this offering, the Company intends to continue purchasing advertising space from
City Visitor from time to time. However, the Company has neither entered into a
contract with, nor made any commitment with respect to the amounts of
advertising purchases from, City Visitor. The Company believes that the prices
currently paid to City Visitor for advertising are no less favorable than could
be obtained from non-affiliated third parties.

COMPANY POLICY

The Company's policy is that any future transactions with directors,
officers, employees or affiliates of the Company be approved in advance by a
majority of the Company's Board of Directors, including a majority of
disinterested directors, and be on terms no less favorable to the Company than
the Company could obtain from non-affiliated parties.

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<PAGE> 45

DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 35,000,000 shares of
Common Stock, $.01 par value per share, and 5,000,000 shares of Preferred Stock,
$.01 par value per share. The following summary of the Common Stock and the
Preferred Stock is qualified by reference to the Company's Amended and Restated
Certificate of Incorporation and By-laws included as exhibits to the
Registration Statement of which this Prospectus is a part.

COMMON STOCK

The Company had outstanding immediately prior to this offering 5,475,000
shares of Common Stock and options to purchase an aggregate of 508,167 shares of
Common Stock. A total of 1,000,000 shares of Common Stock are reserved for
issuance under the Equity Incentive Plan and a total of 100,000 shares of Common
Stock are reserved for issuance under the Directors' Plan. Holders of Common
Stock are entitled to one vote for each share held of record on all matters
submitted to a vote of the stockholders, and do not have cumulative voting
rights. Subject to preferences that may be applicable to any outstanding shares
of Preferred Stock, holders of Common Stock are entitled to receive ratably such
dividends, if any, as may be declared from time to time by the Board of
Directors of the Company out of funds legally available therefor. See "Dividend
Policy." All outstanding shares of Common Stock are, and the shares to be sold
in this offering when issued and paid for will be, fully paid and nonassessable,
and the holders thereof will have no preferences or conversion, exchange or
pre-emptive rights. In the event of any liquidation, dissolution or winding-up
of the affairs of the Company, holders of Common Stock will be entitled to share
ratably in the assets of the Company remaining after payment or provision for
payment of all of the Company's debts and obligations and after liquidation
payments to holders of outstanding shares of Preferred Stock, if any.

PREFERRED STOCK

The Preferred Stock, if issued, would have priority over the Common Stock
with respect to dividends and other distributions, including the distribution of
assets upon liquidation. The Board of Directors has the authority, without
further stockholder authorization, to issue from time to time shares of
Preferred Stock in one or more series and to fix the terms, limitations,
relative rights and preferences and variations of each series. In addition to
having a preference with respect to dividends or liquidation proceeds, the
Preferred Stock, if issued, may be entitled to the allocation of capital gains
from the sale of the Company's assets. Although the Company has no present plans
to issue any shares of Preferred Stock following the closing of this offering,
the issuance of shares of Preferred Stock, or the issuance of rights to purchase
such shares, could decrease the amount of earnings and assets available for
distribution to the holders of Common Stock, could adversely affect the rights
and powers, including voting rights, of the Common Stock, and could have the
effect of delaying, deterring or preventing a change in control of the Company
or an unsolicited acquisition proposal.

ADVANCE NOTICE PROVISIONS FOR STOCKHOLDER PROPOSALS AND STOCKHOLDER NOMINATIONS
OF DIRECTORS

The By-laws establish an advance notice procedure with regard to the
nomination by the stockholders of the Company of candidates for election as
directors and with regard to other matters to be brought by stockholders before
a meeting of stockholders of the Company.

These procedures require that a stockholder seeking to nominate a director
or propose business at an annual meeting give written notice of such nomination
or proposal, delivered to or mailed and received by the Secretary of the Company
at the principal executive offices of the Company not less than 60 days nor more
than 90 days prior to the meeting. Detailed requirements as to the form, timing
and substance of that notice are specified in the By-laws. No persons shall be
eligible for election as a director of the Company nor shall any business matter
be conducted unless nominated or proposed, as the case may be, in strict
accordance with the procedures set forth in the Company's By-laws, as determined
by the President of the Company.

Although the By-laws do not give the Board of Directors any power to
approve or disapprove stockholder nominations for the election of directors or
of any other business desired by stockholders to be conducted at an annual or
any other meeting, the By-laws (i) may have the effect of precluding nominations
for the election of

44
<PAGE> 46

directors or precluding the conduct of business at a particular annual meeting
if the proper procedures are not followed or (ii) may discourage or deter a
third party from conducting a solicitation of proxies to elect its own slate of
directors or otherwise attempting to obtain control of the Company, even if the
conduct of such solicitation or such attempt might be beneficial to the Company
and its stockholders.

OTHER PROVISIONS

Special Meetings of the Stockholders of the Company. The Company's By-laws
provide that a special meeting of the stockholders of the Company only may be
called by the President, the Chairman of the Board or by order of the Board of
Directors. The By-laws do not authorize the stockholders to call a special
meeting of stockholders, potentially limiting the stockholders' ability to offer
proposals between annual meetings if no special meetings are otherwise called by
the President, Chairman or the Board.

Amendment of the By-laws. The Company's Certificate of Incorporation
provides that the By-laws may be amended only by a majority vote of the Board of
Directors or by a vote of at least 75% of the outstanding shares of the
Company's stock entitled to vote in the election of directors.

No Action by Written Consent. The Company's Certificate of Incorporation
does not permit the Company's stockholders to act by written consent. As a
result, any action to be taken by the Company's stockholders must be taken at a
duly called meeting of the stockholders.

DELAWARE ANTI-TAKEOVER STATUTE

The Company is subject to Section 203 of the DGCL which, with certain
exceptions, prohibits a Delaware corporation from engaging in any of a broad
range of business combinations with any "interested stockholder" for a period of
three years following the date that such stockholder became an interested
stockholder, unless: (i) prior to such date, the Board of Directors of the
corporation approved either the business combination or the transaction which
resulted in the stockholder becoming an interested stockholder, (ii) upon
consummation of the transaction which resulted in the stockholder becoming an
interested stockholder, the interested stockholder owned at least 85% of the
voting stock of the corporation outstanding at the time the transaction
commenced, excluding for purposes of determining the number of shares
outstanding those shares owned (a) by persons who are directors and officers and
(b) by employee stock plans in which employee participants do not have the right
to determine confidentially whether shares held subject to the plan will be
tendered in a tender or exchange offer or (iii) on or after such date, the
business combination is approved by the Board of Directors and authorized at an
annual or special meeting of stockholders by the affirmative vote of at least
66 2/3% of the outstanding voting stock which is not owned by the interested
stockholder. An "interested stockholder" is defined as any person that is (i)
the owner of 15% or more of the outstanding voting stock of the corporation or
(ii) an affiliate or associate of the corporation and was the owner of 15% or
more of the outstanding voting stock of the corporation at any time within the
three-year period immediately prior to the date on which it is sought to be
determined whether such person is an interested stockholder.

TRANSFER AGENT

The transfer agent and registrar for the Company will be selected prior to
the closing of this offering.

45
<PAGE> 47

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, the Company will have 7,175,000 shares of
Common Stock issued and outstanding, and 508,167 shares of Common Stock issuable
upon the exercise of outstanding options. Of these shares, 2,615,000 shares sold
pursuant to this offering (or 3,007,250 shares, if the Underwriters'
over-allotment option is exercised in full) will be freely tradeable without
restriction under the Securities Act, except any shares purchased by an
"affiliate" (as that term is defined under the rules and regulations of the
Securities Act) of the Company, which shares will be subject to the resale
limitations of Rule 144 of the Securities Act. The remaining shares outstanding
upon completion of this offering will be subject to the resale limitations of
Rule 144.

In general, under Rule 144, if a period of at least one year has elapsed
between the later of the date on which restricted securities were acquired from
the Company and the date on which they were acquired from an affiliate, then the
holder of such restricted securities (including an affiliate) is entitled to
sell that number of shares within any three-month period that does not exceed
the greater of (i) one percent of the then outstanding shares of Common Stock or
(ii) the average weekly reported volume of trading of Common Stock during the
four calendar weeks preceding such sale. Sales under Rule 144 also are subject
to certain requirements pertaining to the manner of sales, notices of sales and
the availability of current public information concerning the Company. Any
shares not constituting restricted securities sold by affiliates must be sold in
accordance with the foregoing volume limitations and other requirements but
without regard to the one year holding period. Under Rule 144(k), if a period of
at least two years has elapsed from the later of the date on which restricted
securities were acquired from the Company and the date on which they were
acquired from the affiliate, a holder of such restricted securities who is not
an affiliate at the time of the sale and has not been an affiliate for at least
three months prior to the sale would be entitled to sell the shares immediately
without regard to the volume limitations and other conditions described above.

The Company and each of its directors, director nominees, executive
officers and existing stockholders have agreed with the Representative of the
Underwriters not to sell or otherwise dispose of any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for shares of
Common Stock (subject, in the case of the Company, to an exception for the grant
of options under the Company's Equity Incentive Plan and Directors' Plan or in
connection with acquisitions), for a period of 180 days after the date of this
Prospectus without the written consent of the Representative. See "Shares
Eligible for Future Sale."

An additional 100,000 shares of Common Stock are reserved for issuance
under the Directors' Plan and 1,000,000 shares are reserved for issuance under
the Equity Incentive Plan. The Company presently intends to file a registration
statement under the Securities Act to register Common Stock to be issued
pursuant to exercise of options granted or to be granted under the Directors'
Plan and Equity Incentive Plan. Common Stock issued after the effective date of
such registration statement upon exercise of such options would be available for
immediate resale in the open market, subject to compliance with Rule 144 in the
case of affiliates.

Prior to this offering, there has been no public market for the Common
Stock of the Company, and no predictions can be made of the effect, if any, that
the availability of shares for sale or the actual sale of shares will have on
market prices prevailing from time to time.

46
<PAGE> 48

UNDERWRITING

Subject to the terms and conditions of the Underwriting Agreement, a copy
of which has been filed as an exhibit to the Registration Statement of which
this Prospectus is a part, the Underwriters named below have agreed, severally
and not jointly, through Legg Mason Wood Walker, Incorporated, the
Representative of the Underwriters, to purchase from the Company and the Selling
Stockholders, and the Company and the Selling Stockholders have agreed to sell
to the Underwriters, the number of shares of Common Stock set forth opposite the
name of the respective Underwriter at the Price to Public less the Underwriting
Discount set forth on the cover page of this Prospectus.

<TABLE>
<CAPTION>
UNDERWRITER NUMBER OF SHARES
------------------------------------------------------------- ----------------
<S> <C>
Legg Mason Wood Walker, Incorporated.........................

---------
Total.............................................. 2,615,000
=========
</TABLE>

The Underwriting Agreement provides that the obligations of the
Underwriters are subject to certain conditions precedent and that the
Underwriters will purchase all of the shares offered hereby if any of the shares
are purchased.

The Underwriters have advised the Company that they propose to offer all or
a part of the shares offered hereby directly to the public at the Price to
Public set forth on the cover page of this Prospectus, that they may offer
shares to certain dealers at a price which represents a concession of $
per share and they may allow, and such dealers may reallow, a concession of not
more than $ per share to certain other dealers. After the commencement of
this offering, the Price to Public and the concessions may be changed.

The Company has granted the Underwriters a 30-day option to purchase up to
392,250 additional shares of Common Stock at the Price to Public less the
Underwriting Discount set forth on the cover page of this Prospectus. The
Underwriters may exercise the option only to cover over-allotments, if any, in
connection with the offering of the shares made hereby. To the extent the
Underwriters exercise the option, each of the Underwriters will have a firm
commitment, subject to certain conditions, to purchase approximately the same
percentage of additional shares of Common Stock as the number of shares set
forth opposite that Underwriter's name in the preceding table bears to the total
number of shares listed in such table.

The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act, and to contribute
to payments the Underwriter may be required to make in respect thereof.

The Company and each of its directors, director nominees, executive
officers and existing stockholders have agreed with the Representative of the
Underwriters not to sell or otherwise dispose of any shares of Common Stock, or
any securities convertible into or exercisable or exchangeable for shares of
Common Stock (subject, in the case of the Company, to an exception for the grant
of options under the Company's Equity Incentive Plan and Directors' Plan or in
connection with acquisitions), for a period of 180 days after the date of this
Prospectus without the written consent of the Representative. See "Shares
Eligible for Future Sale."

The Representative of the Underwriters has advised the Company that the
Underwriters do not intend to confirm sales to any account over which they
exercise discretionary authority.

At the request of the Company, the Underwriters have reserved for sale, at
the initial public offering price, up to shares offered hereby for
officers, employees, business associates and related persons of the Company who
have expressed an interest in purchasing Common Stock. The number of shares of

47
<PAGE> 49

Common Stock available for sale to the general public will be reduced to the
extent such persons purchase reserved shares. Any reserved shares that are not
so purchased will be offered by the Underwriters to the general public on the
same basis as the other shares offered hereby.

The Representative has informed the Company and the Selling Stockholders
that the Underwriters do not expect sales to discretionary accounts to exceed 5%
of the total number of shares offered hereby and that the Underwriters do not
intend to confirm sales of shares to any account over which they exercise
discretionary authority.

Prior to this offering, there has been no public market for the Common
Stock. The initial public offering price for the Common Stock will be determined
by negotiations between the Company and the Representative of the Underwriters.
Among the factors to be considered in such negotiations are prevailing market
conditions, the results of operations of the Company in recent periods, the
market capitalizations and stages of development of other companies which the
Company and the Representative of the Underwriters believe to be comparable to
the Company, estimates of the business potential of the Company, the present
state of the Company's development and other factors deemed relevant. The
anticipated initial public offering price set forth on the cover of this
Prospectus is subject to change as a result of market conditions and other
factors.

Until the distribution of the Common Stock is completed, rules of the
Securities and Exchange Commission may limit the ability of the Representative
to bid for and purchase the Common Stock. As an exception to these rules, the
Representative is permitted to engage in certain transactions that stabilize the
price of the Common Stock. Such transactions consist of bids or purchases for
the purpose of pegging, fixing or maintaining the price of the Common Stock.

If the Representative creates a short position in the Common Stock in
connection with the offering, i.e., if it sells more shares of Common Stock than
are set forth on the cover page of this Prospectus, the Representative may
reduce that short position by purchasing shares of Common Stock in the open
market. The Representative may also elect to reduce any short position by
exercising all or part of the over-allotment option described above.

In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of such purchases. Neither the Company nor the
Representative makes any representation or prediction as to the direction or
magnitude of any effect that the transaction described above might have on the
price of the Common Stock. In addition, neither the Company nor the
Representative makes any representation that the Representative will engage in
such transactions or that such transactions, once commenced, will not be
discontinued without notice.

Under the rules of the National Association of Securities Dealers, Inc.
(the "NASD"), when a NASD member participates in the distribution of equity
securities of a company with which an affiliate of such member has a conflict of
interest, the public offering price can be no higher than the price recommended
by a "qualified independent underwriter" (as defined in NASD Rule 2720) (a
"QIU"). The NASD requires that a QIU (i) be a NASD member experienced in the
securities or investment banking business, (ii) not be an affiliate of the
issuer of the securities, and (iii) agree to undertake the responsibilities and
liabilities of an underwriter under the Securities Act. Mr. Robert G. Sabelhaus,
an Executive Vice President and Director of Sales of Legg Mason Wood Walker,
Incorporated, is the husband of Melanie R. Sabelhaus, a director of the Company.
Together, the Sabelhauses currently own, and following completion of the
offering will continue to own, 10% or more of the Common Stock of the Company.
See "Principal and Selling Stockholders." In accordance with the Rules of the
NASD, , has agreed to serve as QIU in this offering and to recommend
an initial public offering price for the Common Stock in compliance with Rule
2720 of the NASD. , in its role as QIU, has performed due diligence
investigations and reviewed and participated in the preparation of the
Prospectus and the Registration Statement of which the Prospectus forms a part,
although, in such capacity, it will receive no additional compensation in
connection with this offering.

48
<PAGE> 50

LEGAL MATTERS

The validity of the shares offered will be passed upon for the Company by
Nutter, McClennen & Fish, LLP, Boston, Massachusetts. Certain legal matters will
be passed upon for the Underwriters by Goodwin, Procter & Hoar LLP, Boston,
Massachusetts.

EXPERTS

The financial statements and schedule included in this Prospectus and
elsewhere in the Registration Statement, to the extent of and for the periods
indicated in the reports, have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and are
included herein in reliance upon the authority of said firm as experts in giving
said reports.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 (the "Registration
Statement") under the Securities Act and the rules and regulations promulgated
thereunder, with respect to the Common Stock offered hereby. This Prospectus
omits certain information contained in the Registration Statement, and reference
is made to the Registration Statement and the exhibits and schedules thereto for
further information with respect to the Company and the Common Stock offered
hereby. Statements contained in this Prospectus concerning the provisions or
contents of any contract, agreement or any other document referred to herein are
not necessarily complete with respect to each such contract, agreement or
document filed as an exhibit to the Registration Statement, and reference is
made to such exhibit for a more complete description of the matters involved,
and each such statement shall be deemed qualified by such reference. The
Registration Statement, including the exhibits and schedules thereto, may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1204, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549 and at the regional offices of the Commission located at 7 World
Trade Center, 13th Floor, New York, New York 10048 and at 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of the Registration
Statement or any part thereof may be obtained from such office, upon payment of
the fees prescribed by the Commission. The Commission maintains a Web site
(http://www.sec.gov) that contains reports, proxy and information statements and
other information regarding registrants that submit electronic filings to the
Commission.

49
<PAGE> 51

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
Basis of Presentation............................................................... F-3
Pro Forma Combined Balance Sheet as of December 31, 1996 (unaudited)................ F-4
Pro Forma Combined Statement of Operations for the Year Ended December 31, 1996
(unaudited)...................................................................... F-5
Pro Forma Combined Statement of Operations for the Three Months Ended March 31, 1997
(unaudited)...................................................................... F-6
Notes to Unaudited Pro Forma Combined Financial Statements.......................... F-7
HISTORICAL FINANCIAL STATEMENTS
BRIDGESTREET ACCOMMODATIONS, INC.
Consolidated Balance Sheets (unaudited).......................................... F-9
Consolidated Statements of Operations (unaudited)................................ F-10
Consolidated Statements of Stockholders' Equity (unaudited)...................... F-11
Consolidated Statements of Cash Flows (unaudited)................................ F-12
Notes to Consolidated Financial Statements (unaudited)........................... F-13
BRIDGESTREET ACCOMMODATIONS, INC.
Report of Independent Public Accountants......................................... F-18
Balance Sheet.................................................................... F-19
Statement of Operations.......................................................... F-20
Statement of Stockholders' Equity................................................ F-21
Statement of Cash Flows.......................................................... F-22
Notes to Financial Statements.................................................... F-23
TEMPORARY CORPORATE HOUSING COLUMBUS, INC.
Report of Independent Public Accountants......................................... F-26
Combined Balance Sheets.......................................................... F-27
Combined Statements of Operations................................................ F-28
Combined Statements of Stockholders' Equity...................................... F-29
Combined Statements of Cash Flows................................................ F-30
Notes to Combined Financial Statements........................................... F-31
CORPORATE LODGINGS, INC.
Report of Independent Public Accountants......................................... F-37
Combined Balance Sheets.......................................................... F-38
Combined Statements of Operations................................................ F-39
Combined Statements of Stockholders' Equity (Deficit)............................ F-40
Combined Statements of Cash Flows................................................ F-41
Notes to Combined Financial Statements........................................... F-42
</TABLE>

F-1
<PAGE> 52

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
EXCLUSIVE INTERIM PROPERTIES, LTD.
Report of Independent Public Accountants......................................... F-47
Combined Balance Sheets.......................................................... F-48
Combined Statements of Operations................................................ F-49
Combined Statements of Stockholders' Equity...................................... F-50
Statements of Cash Flows......................................................... F-51
Notes to Combined Financial Statements........................................... F-52
HOME AGAIN, INC.
Report of Independent Public Accountants......................................... F-57
Combined Balance Sheets.......................................................... F-58
Combined Statements of Operations................................................ F-59
Combined Statements of Stockholder's Equity...................................... F-60
Combined Statements of Cash Flows................................................ F-61
Notes to Combined Financial Statements........................................... F-62
TEMPORARY HOUSING EXPERTS, INC.
Report of Independent Public Accountants......................................... F-65
Balance Sheets................................................................... F-66
Statements of Operations......................................................... F-67
Statements of Stockholders' Equity............................................... F-68
Statements of Cash Flows......................................................... F-69
Notes to Financial Statements.................................................... F-70
</TABLE>

F-2
<PAGE> 53

BRIDGESTREET ACCOMMODATIONS, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

BASIS OF PRESENTATION

The following unaudited pro forma combined financial statements give effect
to the acquisitions by BridgeStreet Accommodations, Inc. ("BridgeStreet" or the
"Company"), through stock-for-stock mergers (the "Combination"), of the
following providers of flexible accommodation services: (i) Temporary Corporate
Housing Columbus, Inc. and three affiliates ("TCH"), (ii) Exclusive Interim
Properties, Ltd. and an affiliate ("EIP"), (iii) Corporate Lodgings, Inc. and
four affiliates ("CLI"), (iv) Home Again, Inc. and two affiliates ("Home Again")
and (v) Temporary Housing Experts, Inc. ("THEI") (collectively, the "Founding
Companies"). The acquisitions have been accounted for using the purchase method
of accounting, and TCH has been identified as the acquiror for financial
presentation purposes. The unaudited pro forma combined financial statements
also give effect to this offering and the use of proceeds from this offering as
described under "Use of Proceeds." These financial statements are based on the
historical financial statements of the Founding Companies included elsewhere in
this Prospectus and the estimates and assumptions set forth herein.

The unaudited pro forma combined balance sheet gives effect to the
Combination, and the payment of the related purchase prices for the Founding
Companies, as if the Combination had occurred on December 31, 1996. The
allocation of the purchase price to the assets acquired and the liabilities
assumed initially has been assigned and recorded based on estimates of their
fair value, and may be revised as additional information concerning the
valuation of such assets and liabilities becomes available. It is management's
opinion, however, that the final allocation of the purchase price will not
differ materially from the preliminary estimated amounts. The purchase price
represents a fair market valuation of the acquired entities as determined by an
independent investment banking firm based on specific information regarding each
of the Founding Companies, which included historical financial statements, tax
returns and detailed discussions with each company's management as to
operations, financial condition and future prospects. Other valuation factors
included published industry information and certain financial analyses. The
unaudited pro forma combined statement of operations for the year ended December
31, 1996 gives effect to the Combination as if it had occurred on January 1,
1996. The historical results of operations for EIP represents 12 months derived
from the unaudited three months ended March 31, 1996 and the audited nine months
ended December 31, 1996. The unaudited pro forma combined statement of
operations for the three months ended March 31, 1997 gives effect to the
acquisition of Home Again as if it occurred on January 1, 1997; the acquisition
of TCH, EIP, CLI and THEI all occurred on January 2, 1997. In the opinion of
management, all adjustments necessary to present fairly the pro forma financial
statements have been made.

The unaudited pro forma combined financial information presented herein
does not purport to represent what the Company's financial position and results
of operations actually would have been had such events occurred on the dates
noted above, or to project the Company's financial position or results of
operations for any future period or the future results of the Founding
Companies. The unaudited pro forma combined financial statements should be read
in conjunction with the other financial statements and notes thereto included
elsewhere in this Prospectus.

F-3
<PAGE> 54

BRIDGESTREET ACCOMMODATIONS, INC. AND FOUNDING COMPANIES

PRO FORMA COMBINED BALANCE SHEET
DECEMBER 31, 1996
(IN THOUSANDS)

<TABLE>
<CAPTION>
HOME PRO FORMA
TCH CLI THEI EIP AGAIN BRIDGESTREET ADJUSTMENTS
------ ------ ---- ------ ---- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents............................ $ 598 $ 180 $ 52 $ -- $146 $ 6 $ --
Investments in short-term marketable securities...... 152 -- -- -- -- -- --
Accounts receivables, net............................ 795 604 99 418 108 -- --
Security deposits held by landlords.................. -- -- 24 151 8 -- --
Deferred tax asset................................... 129 28 71 167 -- 1 --
Prepaid expense & other.............................. 34 126 26 -- 218 -- --
------ ------ ---- ------ ---- ---- ------
Total current assets............................... 1,708 938 272 736 480 7 --
Operating stock........................................ 268 -- 146 580 196 -- --
Property and equipment................................. 27 118 57 1,392 143 -- --
Other assets........................................... -- 1 -- 8 -- 412 (176)(d)
Notes receivable-stockholders related party............ 10 -- -- -- -- -- --
Goodwill............................................... -- -- -- -- -- -- 6,031(c)
------ ------ ---- ------ ---- ---- ------
Total assets................................... $2,013 $1,057 $475 $2,716 $819 $419 $ 5,855
======= ======= ==== ====== ==== ==== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt................. $ -- $ 10 $ 19 $ 137 $ 9 $ -- $ --
Due to stockholders and affiliates................... -- 28 -- 93 191 417 --
Accounts payable and accrued expenses................ 622 440 58 584 366 -- --
Accrued income taxes................................. 100 76 16 -- -- -- --
Deferred revenue..................................... -- 428 34 155 31 -- --
Security deposits due to customers................... -- -- 50 260 60 -- --
------ ------ ---- ------ ---- ---- ------
Total current liabilities.......................... 722 982 177 1,231 657 417 --
Long-term debt, net of current maturities.............. -- -- 12 1,049 26 -- --
Deferred income taxes.................................. 107 -- 58 233 -- -- --
Stockholders' Equity (Deficit):
Common stock......................................... 31 5 1 -- 3 12 3(d)
Additional paid in capital........................... -- 180 -- 76 -- (9) 7,382(d)
Treasury stock....................................... (4) -- -- -- -- -- 4(d)
Retained earnings (deficit).......................... 1,157 (110) 227 127 133 (1) 1,534(d)
------ ------ ---- ------ ---- ---- ------
Total stockholders' equity......................... 1,184 75 228 203 136 2 5,855
------ ------ ---- ------ ---- ---- ------
Total liabilities and stockholders' equity..... $2,013 $1,057 $475 $2,716 $819 $419 $ 5,855
======= ======= ==== ====== ==== ==== =======

<CAPTION>
PRO FORMA
PRO FORMA ADJUSTMENTS AS ADJUSTED
--------- ----------- -----------
<S> <<C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents............................ $ 982 $10,471(a) $11,453
Investments in short-term marketable securities...... 152 -- 152
Accounts receivables, net............................ 2,024 -- 2,024
Security deposits held by landlords.................. 183 -- 183
Deferred tax asset................................... 395 -- 395
Prepaid expense & other.............................. 404 -- 404
------ ------- -------

Total current assets............................... 4,140 10,471 14,611
Operating stock........................................ 1,190 -- 1,190
Property and equipment................................. 1,737 -- 1,737
Other assets........................................... 245 (235)(e) 10
Notes receivable-stockholders related party............ 10 -- 10
Goodwill............................................... 6,031 -- 6,031
------ ------- -------

Total assets................................... $13,353 $10,236 $23,589
====== ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt................. $ 175 $ (175)(b) $ --
Due to stockholders and affiliates................... 731 (731)(b) --
Accounts payable and accrued expenses................ 2,070 -- 2,070
Accrued income taxes................................. 192 -- 192
Deferred revenue..................................... 648 -- 648
Security deposits due to customers................... 370 -- 370
------ ------- -------

Total current liabilities.......................... 4,186 (906) 3,280
Long-term debt, net of current maturities.............. 1,087 (1,087)(b) --
Deferred income taxes.................................. 398 -- 398
Stockholders' Equity (Deficit):
Common stock......................................... 55 17(e) 72
Additional paid in capital........................... 7,628 12,212(e) 19,840
Treasury stock....................................... -- -- --
Retained earnings (deficit).......................... (1) -- (1)
------ ------- -------

Total stockholders' equity......................... 7,682 12,229 19,911
------ ------- -------

Total liabilities and stockholders' equity..... $13,353 $10,236 $23,589
====== ======= =======
</TABLE>

See accompanying notes to pro forma financial statements.

F-4
<PAGE> 55

BRIDGESTREET ACCOMMODATIONS, INC. AND FOUNDING COMPANIES

PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDING DECEMBER 31, 1996

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
HOME
TCH CLI THEI EIP AGAIN BRIDGESTREET ADJUSTMENTS(J) PRO FORMA
----------- ---------- ---------- ---------- ---------- ------------ -------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues......... $ 12,502 $ 8,820 $ 3,583 $ 8,626 $ 4,035 $ -- $ -- $ 37,566
Cost of
services........ 9,088 6,106 2,578 7,039 3,134 -- $ -- 27,945
Selling, general
and
administrative
expense......... 2,327 2,519 1,078 1,374 586 2 (552)(f) 7,334
Goodwill
amortization.... -- -- -- -- -- -- 172(g) 172
----------- ---------- ---------- ---------- ---------- ---------- ------- --------
Operating income
(loss).......... 1,087 195 (73) 213 315 (2) 380 2,115
Other income
(expenses)...... 89 (206) 5 (130) 77 -- 158(h) (7)
----------- ---------- ---------- ---------- ---------- ---------- ------- --------
Income (loss)
before provision
for income
taxes........... 1,176 (11) (68) 83 392 (2) 538 2,108
Provision
(benefit) for
income taxes.... 513 9 (23) 41 -- (1) 373(i) 912
----------- ---------- ---------- ---------- ---------- ---------- ------- --------
Net income
(loss).......... $ 663 $ (20) $ (45) $ 42 $ 392 $ (1) $ 165 $ 1,196
=========== ========== ========== ========== ========== ========== ======= ========
Pro forma net
income per
share........... $ 0.17
========
Shares used in
computing pro
forma net income
per share....... 7,175,000
</TABLE>

See accompanying notes to pro forma financial statements.

F-5
<PAGE> 56

BRIDGESTREET ACCOMMODATIONS, INC. AND FOUNDING COMPANIES

PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDING MARCH 31, 1997

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
BRIDGESTREET HOME
ACCOMMODATIONS, INC. AGAIN ADJUSTMENTS PRO FORMA
-------------------- ------ ----------- ----------
<S> <C> <C> <C> <C>
Revenues......................................................... $9,102 $1,167 $ 10,269
Cost of services................................................. 7,012 823 7,835
Selling, general and administrative expense...................... 2,513 230 30(k) 2,773
Goodwill amortization............................................ 45 -- 7(l) 52
------ ------ --- ----------
Operating income (loss).......................................... (468) 114 (37) (391)
Other income (expense)........................................... 6 1 33(m) 40
------ ------ --- ----------
Income (loss) before provision for income taxes.................. (462) 115 (4) (351)
Provision (benefit) for income taxes............................. (224) -- (56)(n) (168)
------ ------ --- ----------
Net income (loss)................................................ $ (238) $ 115 $ (60) $ (183)
====== ====== === ==========
Pro forma net income per share................................... $ (0.03)
==========
Shares used in computing pro forma net income per share.......... 7,175,000
==========
</TABLE>

F-6
<PAGE> 57

BRIDGESTREET ACCOMMODATIONS, INC. AND FOUNDING COMPANIES

NOTES TO PRO FORMA FINANCIAL STATEMENTS

1. BACKGROUND

BridgeStreet was incorporated in August 1996 with the objective of becoming
a leading national provider of flexible accommodation services. The Company
acquired all of the outstanding stock of TCH, EIP, CLI and THEI on January 2,
1997 and Home Again on March 31, 1997 in exchange for 4,301,000 shares of Common
Stock of the Company. The Company conducted no operations prior to January 2,
1997 except in connection with this offering and the Combination. For financial
reporting purposes, TCH has been designated as the accounting acquiror, and its
acquisition of the remaining four Founding Companies has been accounted for
using the purchase method of accounting.

2. UNAUDITED PRO FORMA COMBINED BALANCE SHEET ADJUSTMENTS (IN THOUSANDS EXCEPT
SHARE AND PER SHARE AMOUNTS)

(a) Records the net increase to cash from the net proceeds of this offering
of 1,700,000 shares of Common Stock at an assumed offering price of $9.00 per
share, less underwriters' discounts and other offering costs, and less the use
of proceeds to pay down approximately $1,262 of bank debt and $731 payable to
stockholders and affiliates.

(b) Records the assumed repayment of bank debt and amounts payable to
stockholders and affiliates.

(c) Records the goodwill resulting from the acquisition of four of the
Founding Companies by TCH. The goodwill is calculated as follows:

<TABLE>
<S> <C>
Appraised value of the four Founding Companies................... $ 5,630
Transaction costs................................................ 1,042
----------
Total purchase price............................................. 6,672
Less: fair market value of net assets acquired................... 641
----------
Goodwill......................................................... $ 6,031
==========
</TABLE>

A company's client base cannot be separated from the general goodwill of an
ongoing business, and industry practice is not to assign separate value to
client base.

(d) Increase in stockholders' equity to record fair market value of shares
issued to acquire Founding Companies other than TCH, record transaction fees
paid in Company stock and eliminate in consolidation the Founding Companies'
equity sections. Also allocates to paid-in capital $176 of deferred merger
costs.

(e) Records net proceeds of this offering assuming an offering price of
$9.00 per share less underwriters' commissions and other offering costs of
$3,100. Also allocates to paid-in capital $235 of deferred offering costs.

3. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS ADJUSTMENTS FOR THE
YEAR ENDED DECEMBER 31, 1996 (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

(f) Compensation to certain executives of the Founding Companies has been
adjusted to reflect the compensation to be paid pursuant to employment
agreements signed in connection with the Combination.

(g) Amortization of goodwill over 35 years.

(h) Interest expense related to the bank debt and notes payable to
stockholders has been eliminated because it is assumed to have been repaid at
the beginning of the period.

(i) Pro forma provision for income taxes has been adjusted to reflect the
Company's estimated consolidated effective tax rate subsequent to the
Combination, after considering nondeductible goodwill amortization.

(j) The pro forma combined statement of operations excludes any adjustments
for the compensation to be paid in 1997 for services to be rendered in 1997 by
the Company's Chief Executive Officer and Chief

F-7
<PAGE> 58

BRIDGESTREET ACCOMMODATIONS, INC. AND FOUNDING COMPANIES

NOTES TO PRO FORMA FINANCIAL STATEMENTS -- (CONTINUED)

Financial Officer pursuant to their employment agreements. The statement also
excludes approximately $563 of non-recurring non-cash compensation expense
recorded in the first quarter of 1997 in connection with the vesting of
restricted stock.

4. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS ADJUSTMENTS FOR THE
THREE MONTHS ENDED MARCH 31, 1997 (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)

(k) Compensation to certain executives of Home Again has been adjusted to
reflect the compensation to be paid pursuant to employment agreements signed in
connection with the acquisition of Home Again.

(l) Amortization of goodwill over 35 years associated with the acquisition
of Home Again.

(m) Interest expense related to the bank debt and notes payable to
stockholders has been eliminated because it is assumed to have been repaid at
the beginning of the period.

(n) Pro forma provision for income taxes has been adjusted to reflect the
Company's estimated consolidated effective tax rate of 48% for 1997 subsequent
to the acquisition of Home Again, after considering nondeductible goodwill
amortization and nondeductible compensation expense in connection with the
vesting of restricted stock.

F-8
<PAGE> 59

BRIDGESTREET ACCOMMODATIONS, INC.
CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
BRIDGESTREET
MARCH 31,
TCH 1997
DECEMBER 31, -----------
1996
------------ (UNAUDITED)
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents...................................... $ 597,939 $ 877,806
Investments in short-term marketable securities................ 152,253 239,752
Accounts receivables-
Trade, less allowance for doubtful accounts of $45,000 in
1996 and $276,315 in 1997................................... 794,445 2,955,418
Security deposits held by landlords............................ -- 171,535
Deferred income taxes.......................................... 129,200 771,543
Other current assets........................................... 33,927 479,063
----------- -----------
Total current assets...................................... 1,707,764 5,495,117
Operating stock, net of accumulated amortization.................... 268,086 1,235,360
Property and equipment, net of accumulated depreciation............. 26,961 1,814,660
Other assets........................................................ -- 350,934
Notes receivable - shareholders/affiliates.......................... 10,568 182
Goodwill, net of amortization....................................... -- 6,100,616
----------- -----------
Total assets.............................................. $2,013,379 $14,996,869
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt........................... $ -- $ 109,030
Due to stockholders and affiliates............................. -- 881,328
Accounts payable and accrued expenses.......................... 622,021 2,549,287
Accrued income taxes........................................... 100,000 133,226
Deferred revenue............................................... -- 872,121
Security deposits due to customers............................. -- 417,221
----------- -----------
Total current liabilities................................. 722,021 4,962,213
Long-term debt, net of current maturities........................... -- 1,542,227
Deferred income taxes............................................... 107,744 485,945
Commitments and contingencies
Stockholders' Equity:
Common stock................................................... 31,000 54,750
Additional paid in capital..................................... -- 8,191,516
Treasury stock................................................. (4,185) --
Retained earnings (deficit).................................... 1,156,799 (239,782)
----------- -----------
Total stockholders' equity................................ 1,183,614 8,006,484
----------- -----------
Total liabilities and stockholders' equity........... $2,013,379 $14,996,869
=========== ===========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-9
<PAGE> 60

BRIDGESTREET ACCOMMODATIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------------
TCH BRIDGESTREET
1996 1997
---------- -------------
<S> <C> <C>
Revenues............................................................. $2,638,201 $ 9,102,402
Operating Expenses:
Cost of services................................................ 1,988,726 7,012,262
Selling, general and administrative expense..................... 483,077 2,512,862
Goodwill amortization........................................... -- 45,000
-------- ---------
Total operating expenses................................... 2,471,803 9,570,124
-------- ---------
Operating income (loss).................................... 166,398 (467,722)
Other Income (Expense):
Interest income................................................. (2,658) 9,356
Interest expense................................................ (107) (33,604)
Other income, net............................................... 29,794 29,866
-------- ---------
Other income, net.......................................... 27,029 5,618
-------- ---------
Income (loss) before provision (benefit) for income taxes....... 193,427 (462,104)
Provision (benefit) for income taxes............................ 84,291 (223,658)
-------- ---------
Net income (loss)............................................... $ 109,136 $ (238,446)
======== =========
Net income (loss) per share..................................... $ (0.04)
=========
Weighted average shares outstanding............................. 5,475,000
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-10
<PAGE> 61

BRIDGESTREET ACCOMMODATIONS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL TOTAL
------------------- PAID-IN ACCUMULATED STOCKHOLDERS'
SHARES AMOUNT CAPITAL DEFICIT EQUITY
--------- ------ ---------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1996............ 1,174,000 11,740 (9,024) (1,336) 1,380
Issuance of stock to founders.... 4,301,000 43,010 7,638,040 -- 7,681,050
Stock compensation to officers... -- -- 562,500 -- 562,500
Net loss......................... -- -- -- (238,446) (238,446)
--------- ------ --------- -------- ---------
Balance, March 31, 1997............... 5,475,000 54,750 8,191,516 (239,782) 8,006,484
========= ====== ========= ======== =========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-11
<PAGE> 62

BRIDGESTREET ACCOMMODATIONS, INC

CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------------
TCH BRIDGESTREET
1996 1997
--------- ------------
<S> <C> <C>
Cash Flows From Operating Activities:
Net income (loss).................................................. $ 109,136 $ (238,446)
Adjustments to reconcile net income (loss) to net cash used in
operating activities--
Non-cash compensation........................................... -- 562,500
Depreciation and amortization................................... 20,583 154,568
Change in operating assets and liabilities--
Accounts receivable........................................... (133,232) (918,511)
Security deposits held by landlords........................... -- 9,438
Prepaid expenses.............................................. -- (266,406)
Other assets.................................................. 9,823 --
Accounts payable and accrued expenses......................... (19,586) 721,407
Accrued taxes................................................. 100,919 (58,762)
Deferred income taxes......................................... (139,756) (365,786)
Security deposits due to customers............................ -- 40,969
Deferred revenue.............................................. -- 212,361
--------- ---------
Net cash used in operating activities...................... (52,113) (146,668)
Cash Flows From Investing Activities:
Purchases of investments in short term marketable securities....... (112,617) (87,499)
Cash and cash equivalents of businesses acquired................... -- 344,419
Purchases of operating stock....................................... (27,403) (69,182)
Purchases of property and equipment................................ (8,355) (122,276)
--------- ---------
Net cash (used in) provided by investing activities........ (148,375) 65,462
--------- ---------
Cash Flows From Financing Activities:
Borrowings from stockholders....................................... -- 63,903
Repayment of long term debt........................................ -- (118,586)
Borrowings under line of credit.................................... -- 300,000
Borrowings under promissory note................................... -- 211,112
Capitalization of offering costs................................... -- (105,742)
Collections of notes receivable.................................... -- 10,386
--------- ---------
Net cash provided by financing activities.................. -- 361,073
--------- ---------
Net (decrease) increase in cash and cash equivalents....... (200,488) 279,867
Cash and cash equivalents, beginning of period....................... 834,615 597,939
--------- ---------
Cash and cash equivalents, end of period............................. $ 634,127 $ 877,806
========= =========
Supplemental Cash Flow Information:
Cash paid for interest..................................... $ 107 $ 25,331
========= =========
Cash paid for income taxes................................. $ 123,428 $ 196,401
========= =========
Non-Cash Transaction:
During the first quarter of 1997, the Company exchanged 4,301,000
shares of Common Stock in the Company for all of the outstanding
stock of the five Founding Companies.
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-12
<PAGE> 63

BRIDGESTREET ACCOMODATIONS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

BridgeStreet Accommodations, Inc. ("BridgeStreet" or the "Company") was
incorporated on August 19, 1996, to create a leading national provider of
flexible accommodation services through the acquisition and consolidation of the
operations of flexible accommodation service companies. During the first quarter
of 1997, the Company became the holder of all the outstanding stock of the
Founding Companies, five flexible accommodation service providers (the
"Combination"), in exchange for 4,301,000 shares of Common Stock of the Company
(see note 4). The Company conducted no operations prior to January 2, 1997,
except in connection with the offering and the Combination. For financial
reporting purposes, the largest founding company, Temporary Corporate Housing
Columbus, Inc. ("TCH") has been designated as the accounting acquiror, and its
acquisition of the remaining four Founding Companies has been accounted for
using the purchase method of accounting.

The interim consolidated financial statements presented herein have been
prepared by the Company and include the unaudited accounts of TCH, Corporate
Lodgings, Inc., Exclusive Interim Properties, Ltd. and Temporary Housing
Experts, Inc. all of which were merged on January 2, 1997, as well as the
accounts of Home Again, Inc. which was acquired on March 31, 1997. In the
opinion of management, the financial statements reflect all adjustments of a
normal recurring nature necessary for a fair statement of BridgeStreet's
financial position at March 31, 1997, the results of operations for the
three-month period ended March 31, 1997, and cash flows for the three-month
period ended March 31, 1997.

The financial position at March 31, 1996, the results of operations for the
three-month period ended March 31, 1996, and cash flows for the three-month
period ended March 31, 1996 presented herein are of TCH, the designated
accounting acquiror. In the opinion of management these financial statements
reflect all normal and recurring adjustments necessary for a fair presentation
of financial position, results of operations and cash flows for the period
presented.

Interim results are not necessarily indicative of results for a full year.

The balance sheet presented as of December 31, 1996, has been derived from
the financial statements of TCH that have been audited by the Company's
independent public accountants. The consolidated financial statements and notes
included herein should be read in conjunction with the financial statements and
notes of TCH and the acquired companies included elsewhere in this prospectus.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Refer to the combined financial statement footnotes of TCH and the Company
included in this registration statement. The Company follows these policies and
the policies described in the next two paragraphs.

The Company accounts for goodwill in accordance with Statement of Financial
Accounting Standards (SFAS) No. 121, Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed of. The Company assesses the
future useful life of the assets whenever events or changes in circumstances
indicate that the current useful life has diminished. The Company considered the
future undiscounted cash flows of the acquired companies in assessing the
recoverability of the asset. If impairment has occurred, any excess of carrying
value over fair value is recorded as a loss.

The Company intends to account for its stock-based compensation plans under
Statement of Financial Accounting Standard No. 123 Accounting for Stock-Based
Compensation, and to elect the disclosure only provisions for stock options as
permitted by SFAS No. 123.

F-13
<PAGE> 64

BRIDGESTREET ACCOMODATIONS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

3. INCOME TAXES

The Company records income taxes pursuant to Statement of Financial
Accounting Standards (SFAS) No. 109, Accounting for Income Taxes. Under SFAS No.
109, deferred income taxes are recognized for the tax consequences of temporary
differences by applying enacted statutory rates applicable to future years to
differences between the financial statement carrying amounts and the tax basis
of existing assets and liabilities. The effect on deferred taxes of a change in
tax rates is recognized as income in the period that includes the enactment
date.

Income taxes for the first quarter of 1997 have been provided based on the
Company's estimated full year 1997 effective tax rate of approximately 48%. The
rate is higher than the Federal statutory rate of 34% because of state taxes and
because goodwill amortization and the officers' restricted stock compensation
charge (see Note 11) are not tax deductible. Deferred tax assets and liabilities
resulting in temporary differences between tax and book reporting relate
primarily to operating stock, accounts receivable and other accruals. Certain of
the founding companies elected to be recognized as S corporations under the
appropriate federal and state tax codes when formed. Upon their acquisition by
the Company, these entities were converted to C Corporation tax filing status.
The impact of the change in tax reporting was recorded in purchase accounting
and was not material to the financial statements.

4. DEFERRED OFFERING AND MERGER COSTS

Deferred offering costs consist primarily of legal, accounting and other
professional fees incurred in connection with the offering. All of the costs
associated with the Combination will be included as a component of the purchase
price pursuant to the purchase method of accounting. All the costs associated
with the offering will be charged to stockholders' equity as a reduction to the
proceeds of the offering when the offering closes.

5. ACQUISITIONS

As discussed in Note 1, in the first quarter of 1997, the Company merged
with five flexible accommodation operating companies in stock for stock tax-free
mergers. The mergers have been accounted for using the purchase method of
accounting with TCH designated as the accounting acquiror and the other
operating companies designated as "acquired companies." The results of
operations of the "acquired companies" have been included in the accompanying
consolidated financial statements from their respective dates of acquisition.
The purchase price of the four "acquired companies" was approximately $6.7
million based on an independent appraisal of the companies acquired and stock
issued to the founders of BridgeStreet as a transaction fee. The aggregate cost
of the acquisitions exceeded the estimated fair value of assets and liabilities
of the acquired companies by $6,068,000. Goodwill is being amortized over 35
years. Allocation of the purchase price for these acquisitions was based on an
independent appraisal of the fair value of the net assets acquired. Accumulated
goodwill amortization and amortization expense was $45,000 as of and for the
first quarter ended March 31, 1997.

Based on the unaudited data, the following table presents selected
financial information for the Company, TCH and the four acquisitions on a pro
forma basis, assuming the companies had been combined since the beginning of
1996.

<TABLE>
<CAPTION>
YEAR ENDED THREE MONTHS ENDED
DECEMBER 31, 1996 MARCH 31, 1997
------------------ ------------------
<S> <C> <C>
Revenues................................................. $ 37,566,000 $ 10,270,000
Net income (loss)........................................ $ 770,000 $ (183,000)
Net income (loss) per share.............................. $ 0.14 $ (0.03)
</TABLE>

The pro forma results are not necessarily indicative of future operations
or the actual results that would have occurred had the acquisitions been made at
the beginning of 1996.

F-14
<PAGE> 65

BRIDGESTREET ACCOMODATIONS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

6. PROPERTY AND EQUIPMENT; OPERATING STOCK

Property and equipment, and operating stock consist of the following:

<TABLE>
<CAPTION>
MARCH 31,
1997 USEFUL LIVES
------------- -------------
<S> <C> <C>
Land........................................................... $ 266,235
Condominiums................................................... 1,069,265 27.5 years
Computer equipment............................................. 212,414 1-5 years
Furniture, office equipment and leasehold improvements......... 223,094 5-7 years
Automobiles.................................................... 105,951 5 years
----------
Total property and equipment.............................. 1,876,959
Less-accumulated depreciation.................................. 62,299
----------
Property and equipment, net............................... $ 1,814,660
==========
Operating stock................................................ $ 1,282,629
Less-accumulated amortization.................................. 47,269
----------
Operating stock, net........................................... $ 1,235,360
==========
</TABLE>

7. REVOLVING CREDIT AGREEMENT AND LONG-TERM DEBT

During the first quarter of 1997 the Company entered into a credit
agreement with a bank to provide up to $10 million of revolving credit. The
revolving credit agreement, secured by the capital stock of the Company's
operating subsidiaries, extends to March 31, 2002. Interest is payable at the
prime rate or 1.25% above the Eurodollar rate. A commitment fee is payable on
the average unused credit at a rate of 0.375%. The revolving credit agreement
contains certain restrictive covenants with which the Company must comply. As of
March 31, 1997, the Company had outstanding $300,000 under this agreement. As of
March 31, 1997, the weighted average interest rate was 8.5%.

Also during the first quarter, the Company borrowed under a promissory note
$211,112. The funds were used to repay a portion of the indebtedness of one of
the acquired companies. The note bears interest at 7.625% and matures on July 1,
1997 unless extended.

See Note 5 of the Exclusive Interim Properties, Ltd. financial statements
included elsewhere in this prospectus for a summary of long-term debt at
December 31, 1996 assumed by the Company on January 2, 1997.

8. RELATED PARTY TRANSACTIONS

Refer to the combined financial statements of the five founding companies
and BridgeStreet Accommodations, Inc. included elsewhere in this registration
statement.

9. CAPITAL STOCK

The Company's authorized capital stock consists of 35,000,000 (increased on
April 10, 1997, from 10,000,000 at December 31, 1996) shares of Common Stock,
$.01 par value per share. On April 10, 1997, the Company's Certificate of
Incorporation authorized 5,000,000 shares of Preferred Stock, $0.01 par value
per share.

F-15
<PAGE> 66

BRIDGESTREET ACCOMODATIONS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

reflected on the balance sheet and in the accompanying notes. At March 31, 1997,
there were 5,475,000 shares of Common Stock outstanding. Holders of Common Stock
are entitled to one vote for each share held of record on all matters to be
submitted to a vote of the stockholders, and do not have cumulative voting
rights. In the event of any liquidation, dissolution or winding-up of the
affairs of the Company, holders of Common Stock will be entitled to share
ratably in the assets of the Company remaining after payment or provision for
payment of all of the Company's debts and obligations and after liquidation
payments to holders of outstanding shares of Preferred Stock, if any.

Preferred Stock. At March 31, 1997, there were no shares of Preferred
Stock outstanding. Holders of Preferred Stock would have priority over the
holders of Common Stock with respect to the dividends, and to other
distributions, including the distribution of assets upon liquidation. The Board
of Directors has the authority, without stockholder authorization, to issue
shares of Preferred Stock in one or more series and to fix terms, limitations,
relative rights and preferences and variations as among series.

10. STOCK OPTION PLANS

The Company adopted the 1997 Equity Incentive Plan (the Equity Incentive
Plan") which provides for the award of incentive stock options ("ISOs"),
non-qualified stock options, stock appreciation rights, performance shares,
restricted stock of stock units to all directors and employees of (including
directors and employees of the founding companies) and consultants and advisors
to the Company. The number of shares authorized and reserved for issuance under
the Equity Incentive Plan is 1,000,000. In general, the terms of awards granted
under the Equity Incentive Plan (including vesting shares) will be established
by the Compensations Committee of the Company's Board of Directors. As of July
11, 1997, the Company had awarded options to purchase 470,667 shares of Common
Stock under the Equity Incentive Plan effective as of the date of the final
Prospectus used in connection with the offering. Of this amount, options to
purchase 300,000 shares were granted pursuant to employment agreements. Each
option will have a per-share exercise price equal to the Offering price.

The Company has adopted the Stock Plan for Non-Employee Directors (the
"Directors' Plan") Pursuant to the Directors' Plan, on the date of the final
Prospectus used in connection with the offering, each director who is not an
employee of the Company or one of its subsidiaries ( a "non-employee director")
and neither is a holder of five percent or more of the Company's Common Stock
nor was a stockholder of the Company prior to the offering will receive options
to purchase 12,500 shares of Common Stock with a Per-share exercise price equal
to the offering price. Thereafter, each such non-employee director will be
granted, on every third anniversary of the final Prospectus (provided he or she
still is a non-employee director at such time), an option to acquire an
additional 7,500 shares of Common Stock, and each non-employee director
initially elected following the offering also will be granted an options to
purchase 7,500 shares of Common Stock having a per-share exercise price equal to
the fair marker value of the Common Stock on the date of such grant. The number
of shares authorized and reserved for issuance under the Directors Plan is
100,000. No options have been granted under the Directors' Plan as of July 11,
1997.

11. RESTRICTED STOCK COMPENSATION

In 1996, the CEO and CFO purchased 250,000 shares of restricted Common
Stock for nominal value. The restrictions were originally scheduled to lapse
upon the earlier to occur of five years from the date of purchase or upon the
successful completion of an initial public offering of the Company's common
stock or a change in control of the Company, as long as the individuals holding
the stock were the CEO and CFO on the date the restrictions lapsed. As part of
the negotiations involving these officers employment agreements during the first
quarter of 1997, the Company's Board of Directors removed all restrictions on
the stock as of March 31, 1997, and all of the restricted shares became fully
vested. In connection with this vesting, the Company recognized non-recurring,
non-cash compensation expense of approximately $563,000, which was

F-16
<PAGE> 67

BRIDGESTREET ACCOMODATIONS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

charged to operations with an offsetting credit to additional paid-in capital in
the first quarter of 1997. The compensation charge of approximately $563,000
represented the difference between the value of the stock issued and the amount
paid by the officers, measured by an independent appraisal as of the date the
individuals were appointed to be the CEO and CFO.

12. EARNINGS PER SHARE

In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128 "Earnings Per Share" which is
effective for periods ending after December 15, 1997. The standard requires the
presentation of basic earnings per share ("EPS") and diluted EPS. Basic EPS
replaces the primary EPS calculation required under APB Opinion No. 15. Basic
EPS excludes dilution and is calculated using the weighted average of common
shares outstanding for the period. Diluted EPS is computed similarly to fully
diluted EPS pursuant to APB Opinion No. 15. The pro forma effect of this
accounting change on the March 31, 1997, EPS data is immaterial.

13. COMMITMENTS AND CONTINGENCIES

Employment Contracts. During the first quarter of 1997, the Company
entered into three-year employment contracts with three officers requiring
minimum base salaries aggregating $450,000 per year. The contracts also provide
severance benefits of up to the longer of 12 months' pay or the remaining
contract term for two of the officers.

Lease Commitments. The Company leases administrative offices,
accommodations and furniture at several locations through August 31, 2003. Rent
expense for the period ended March 31, 1997, was 5,354,893. Minimum future
rental payments on non-cancelable leases at March 31, 1997, are as follows:

<TABLE>
<CAPTION>
OPERATING LEASES
-----------------
<S> <C>
1997...................................................... $ 964,710
1998...................................................... 1,296,528
1999...................................................... 1,195,435
2000...................................................... 580,672
2001...................................................... 264,419
Thereafter................................................ 111,168
----------
Total........................................... $ 4,412,932
==========
</TABLE>

The Company is party to litigation in the ordinary course of business. The
Company does not anticipate an unfavorable result in any such litigation or
believe that an unfavorable result, if it occurred, would have a material
adverse effect on its business, financial condition or results of operations.

14. SUBSEQUENT EVENT

On June 30, 1997, the Company acquired all the assets of a flexible
accommodation services provider in Memphis for $1 million. The cost of the
acquisition exceeded the estimated fair value of the acquired net assets by
$850,000, which will be accounted for as goodwill and will be amortized over 35
years. Allocation of purchase price was based on estimates of the fair value of
the net assets acquired. Pro forma data is not presented since the acquisition
was not material to the Company's results of operations.

F-17
<PAGE> 68

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of BridgeStreet Accommodations, Inc.:

We have audited the accompanying balance sheet of BridgeStreet
Accommodations, Inc. as of December 31, 1996, and the related statement of
operations, stockholders' equity and cash flows from Inception (August 19, 1996)
through December 31, 1996. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements arc free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of BridgeStreet Accommodations,
Inc. as of December 31, 1996, and the results of its operations and its cash
flows from inception through December 31, 1996, in conformity with generally
accepted accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
April 10, 1997

F-18
<PAGE> 69

BRIDGESTREET ACCOMMODATIONS, INC.

BALANCE SHEET

<TABLE>
<CAPTION>
DECEMBER 31,
1996
------------
<S> <C>
ASSETS
Current Assets:
Cash and cash equivalents..................................................... $ 5,804
Deferred income taxes......................................................... 890
--------
Total current assets....................................................... 6,694
Deferred offering and merger costs.............................................. 411,783
Organization costs.............................................................. 449
--------
Total assets.......................................................... $418,926
========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Due to affiliate.............................................................. $417,546
Stockholders' Equity:
Capital stock................................................................. 11,740
Additional paid-in capital.................................................... (9,024)
Accumulated deficit........................................................... (1,336)
--------
Total stockholders' equity................................................. 1,380
--------
Total liabilities and stockholders' equity............................ $418,926
========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-19
<PAGE> 70

BRIDGESTREET ACCOMMODATIONS, INC.

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
INCEPTION
(AUGUST 19, 1996)
THROUGH
DECEMBER 31, 1996
-----------------
<S> <C>
Revenues..................................................................... $ --
Selling, general and administrative expense.................................. 2,226
-------
Loss before benefit for income taxes......................................... (2,226)
Benefit for income taxes..................................................... (890)
-------
Net loss..................................................................... $(1,336)
=======
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-20
<PAGE> 71

BRIDGESTREET ACCOMMODATIONS, INC.

STATEMENT OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL TOTAL
--------------------- PAID-IN ACCUMULATED STOCKHOLDERS'
SHARES AMOUNT CAPITAL DEFICIT EQUITY
--------- ------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Balance, inception, August 19,
1996............................ -- $ -- $ -- $ -- $ --
Shares issued................... 1,174,000 11,740 (9,024) -- 2,716
Net loss........................ -- -- -- (1,336) (1,336)
------- ------ ------- -------
Balance, December 31, 1996........ 1,174,000 $11,740 $ (9,024) $(1,336) $ 1,380
======= ====== ======= =======
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-21
<PAGE> 72

BRIDGESTREET ACCOMMODATIONS, INC.

STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
INCEPTION
(AUGUST 19, 1996)
THROUGH
DECEMBER 31, 1996
-----------------
<S> <C>
Cash Flows From Operating Activities:
Net loss................................................................... $(1,336)
Adjustments to reconcile net loss to net cash used in operating
activities --
Change in assets and liabilities --
Deferred income taxes................................................. (890)
-------
Net cash used in operating activities.............................. (2,226)
Cash Flows Used in Investing Activities:
Organization costs......................................................... (449)

Cash Flows From Financing Activities:
Advances from affiliate.................................................... 5,763
Issuance of common stock................................................... 2,716
-------
Net cash provided by financing activities.......................... 8,479
-------
Net increase in cash and cash equivalents.................................... 5,804
Cash and cash equivalents, beginning of period..................... --
-------
Cash and cash equivalents, end of period........................... $ 5,804
=======
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-22
<PAGE> 73

BRIDGESTREET ACCOMMODATIONS, INC.

NOTES TO FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

BridgeStreet Accommodations, Inc. ("BridgeStreet" or "the Company") was
incorporated on August 19, 1996 to create a leading national provider of
flexible accommodation services through the acquisition and consolidation of the
operations of flexible accommodation service companies. During the first quarter
of 1997 the Company acquired, through stock-for-stock transactions, five
flexible accommodation service providers (the "Combination"). BridgeStreet
intends to complete an initial public offering (the "Offering") of its common
stock and subsequent to the Offering continue to acquire, through merger or
purchase, similar companies to expand its national and regional operations.

BridgeStreet's primary assets at December 31, 1996 are cash and deferred
offering and merger costs. BridgeStreet's only operations to date have related
to the Combination and the Offering. Funding for the deferred offering and
merger costs has been provided by American Business Partners, LLC ("ABP"). See
Note 4.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these financial statements.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original
maturities of three months or less to be cash and cash equivalents.

Stock Based Compensation Plans

The Company intends to account for its stock-based compensation plans under
Statement of Financial Accounting Standards ("SFAS") No. 123, and to elect the
disclosure only provisions for stock options as permitted by SFAS No. 123.

Deferred offering and merger costs

Deferred offering and merger costs consist primarily of legal, accounting
and other professional fees incurred in connection with the Combination and the
Offering. All of the costs associated with the Combination will be included as a
component of the purchase price pursuant to the purchase method of accounting.
All of the costs associated with the Offering will be charged to Stockholders'
Equity as a reduction to the proceeds of the Offering when the Offering closes.

3. INCOME TAXES

The Company records income taxes pursuant to SFAS No. 109, Accounting for
Income Taxes. Under SFAS No. 109, deferred income taxes are recognized for the
tax consequences of temporary differences by applying enacted statutory rates
applicable to future years to differences between the financial statement
carrying amounts and the tax basis of existing assets and liabilities. The
effect on deferred income taxes of a change in tax rates is recognized as income
in the period that includes the enactment. At December 31, 1996 the Company has
recorded as an asset deferred income taxes of $890.

F-23
<PAGE> 74

BRIDGESTREET ACCOMMODATIONS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

4. RELATED PARTY TRANSACTIONS

Funding for the deferred Offering and merger costs has been provided by
ABP. Certain shareholders of BridgeStreet are principals of ABP including the
Company's Chairman. In addition, the Chief Financial Officer of the Company was
a consultant to ABP from January 1996 through December 1996, and the Chief
Executive Officer of the Company was a consultant to ABP from October 31, 1996
through December 31, 1996. At December 31, 1996 ABP has provided aggregate
funding of $417,546. Upon completion of the Offering the Company will pay ABP
for the funding it provided.

The Company also has a consulting agreement with ABP in which ABP will
perform services for the Company in connection with its acquisition program. In
exchange for such services, ABP will be paid a fee of 1% of the transaction
value for each acquisition by the Company after the closing of the Offering for
which ABP provides assistance. ABP also will be reimbursed for all direct
expenses incurred by ABP in connection with such acquisitions. The Company is
not obligated to utilize ABP's services in connection with its acquisition
program.

5. CAPITAL STOCK:

The Company's authorized capital stock consists of 35,000,000 (increased on
April 10, 1997, from 10,000,000 at December 31, 1996) shares of Common Stock,
$0.01 par value per share, and 5,000,000 shares of Preferred Stock, $0.01 par
value per share.

Common Stock. BridgeStreet effected a 499-for-one stock split in November
1996 of its Common Stock for each share of Common Stock then outstanding. The
effects of the stock split have been retroactively reflected on the balance
sheet and in the accompanying notes. At December 31, 1996 there were 1,174,000
shares of Common Stock outstanding. Holders of Common Stock are entitled to one
vote for each share held of record on all matters to be submitted to a vote of
the stockholders, and do not have cumulative voting rights. In the event of any
liquidation, dissolution or winding-up of the affairs of the Company, holders of
Common Stock will be entitled to share ratably in the assets of the Company
remaining after payment or provision for payment of all of the Company's debts
and obligations and after liquidation payments to holders of outstanding shares
of Preferred Stock, if any.

Preferred Stock. At December 31, 1996 there were no shares of Preferred
Stock outstanding. Holders of Preferred Stock would have priority over the
holders of Common Stock with respect to dividends, and to other distributions,
including the distribution of assets upon liquidation. The Board of Directors
has the authority, without stockholder authorization, to issue shares of
Preferred Stock in one or more series and to fix the terms, limitations,
relative rights and preferences and variations as among series.

6. STOCK OPTION PLANS

The Company has adopted the 1997 Equity Incentive Plan (the "Equity
Incentive Plan") which provides for the award of incentive stock options
("ISOs"), non-qualified stock options, stock appreciation rights, performance
shares, restricted stock or stock units to all directors and employees of
(including directors and employees of the Founding Companies) and consultants
and advisors to the Company. The number of shares authorized and reserved for
issuance under the Equity Incentive Plan is 1,000,000. In general, the terms of
awards granted under the Equity Incentive Plan (including vesting schedules)
will be established by the Compensation Committee of the Company's Board of
Directors. As of April 10, 1997 the Company had awarded options to purchase
334,000 shares of Common Stock under the Equity Incentive Plan effective as of
the date of the final Prospectus used in connection with the Offering. Of this
amount, options to purchase 300,000 shares were granted pursuant to employment
agreements. Each option will have a per-share exercise price equal to the
Offering price.

F-24
<PAGE> 75

BRIDGESTREET ACCOMMODATIONS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The Company has adopted the Stock Plan for Non-Employee Directors (the
"Directors' Plan"). Pursuant to the Directors' Plan, on the date of the final
Prospectus used in connection with the Offering, each director who is not an
employee of the Company or one of its subsidiaries (a "non-employee director")
and neither is a holder of five percent or more of the Company's Common Stock
nor was a stockholder of the Company prior to the Offering will receive options
to purchase 12,500 shares of Common Stock with a per-share exercise price equal
to the Offering price. Thereafter, each such non-employee director will be
granted, on every third anniversary of the final Prospectus (provided he or she
still is a non-employee director at such time), an option to acquire an
additional 7,500 shares of Common Stock, and each non-employee director
initially elected following the Offering also will be granted an option to
purchase 7,500 shares of Common Stock having a per-share exercise price equal to
the fair market value of the Common Stock on the date of such grant. The number
of shares authorized and reserved for issuance under the Directors Plan is
100,000. No options have been granted under the plan as of April 10, 1997.

7. COMMITMENTS

Subsequent to December 31, 1996 the Company entered into three year
employment contracts with three officers requiring minimum base salaries
aggregating $450,000 per year. The contracts also provide severance benefits of
up to 12 months' pay for two of the officers.

8. RESTRICTED STOCK COMPENSATION

In 1996, the CEO and CFO purchased an aggregate of 250,000 shares of
restricted Common Stock for nominal value. The restrictions were originally
scheduled to lapse upon the earlier to occur of five years from the date of
purchase or the successful completion of an initial public offering of the
Company's common stock or a change in control of the Company, as long as the
individuals holding the stock were the CEO and CFO on the date the restrictions
lapsed. As part of the negotiations involving these officers' employment
agreements during the first quarter of 1997, the Company's Board of Directors
removed all of the restrictions as of March 31, 1997, and all of the restricted
shares became fully vested on that date. In connection with this vesting, the
Company recognized non-recurring, non-cash compensation expense of approximately
$563,000, which will be charged to operations with an offsetting credit to
Additional paid-in capital in the first quarter of 1997. The compensation charge
of approximately $563,000 represented the difference between the value of the
stock issued and the amount paid by the officers, measured by an independent
appraisal as of the date the individuals were appointed to be the CEO and CFO.

9. SUBSEQUENT EVENTS

During the first quarter of 1997, the Company acquired through
stock-for-stock mergers five flexible accommodation service providers. The
aggregate consideration paid by the Company was 4,301,000 shares of Common
Stock. The companies acquired were Temporary Corporate Housing Columbus, Inc.
(together with its three affiliates), Corporate Lodgings, Inc. (together with
its four affiliates), Exclusive Interim Properties, Ltd. (together with its
affiliate), Home Again, Inc. (together with its two affiliates) and Temporary
Housing Experts, Inc.

During the first quarter of 1997 the Company entered into a credit
agreement with a bank to provide up to $10 million of revolving credit. The
revolving credit, secured by the capital stock of the Company's operating
subsidiaries, extends to March 31, 2002. Interest is payable at the prime rate
or 1.25% above the Eurodollar rate. A commitment fee is payable on the average
unused credit at a rate of 0.375%. The revolving credit agreement contains
certain restrictive covenants with which the Company must comply.

F-25
<PAGE> 76

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of Temporary Corporate Housing Columbus, Inc.:

We have audited the accompanying combined balance sheets of Temporary
Corporate Housing Columbus, Inc. as of December 31, 1995 and 1996, and the
related combined statements of operations, stockholders' equity and cash flows
for each of the three years in the period ended December 31, 1996. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Temporary Corporate
Housing Columbus, Inc. as of December 31, 1995 and 1996, and the combined
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1996, in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
February 28, 1997

F-26
<PAGE> 77

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

COMBINED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------
1995 1996
---------- ----------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents......................................... $ 834,615 $ 597,939
Investment in short-term marketable securities.................... 219,300 152,253
Accounts receivable, less allowance for doubtful accounts
of $45,000 in 1996............................................. 755,649 794,445
Deferred income taxes............................................. 255,217 129,200
Refundable taxes.................................................. -- 33,927
Other current assets.............................................. 36,883 --
----------- -----------
Total current assets........................................... 2,101,664 1,707,764
Operating stock, net of accumulated amortization.................... 220,251 268,086
Property and equipment, net of accumulated depreciation............. 33,482 26,961
Notes receivable -- stockholder/related party....................... 154,602 10,568
----------- -----------
Total assets.............................................. $2,509,999 $2,013,379
=========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable.................................................. $ 208,712 $ 218,407
Accrued expenses --
Payroll and employee benefits.................................. 391,420 61,201
Other.......................................................... 371,880 342,413
Accrued income taxes.............................................. 501,520 100,000
Due to stockholder................................................ 64,844 --
----------- -----------
Total current liabilities...................................... 1,538,376 722,021
Deferred income taxes............................................... 102,500 107,744
Commitments and contingencies
Stockholders' Equity:
Common stock...................................................... 31,000 31,000
Treasury stock.................................................... (4,185) (4,185)
Retained earnings................................................. 842,308 1,156,799
----------- -----------
Total stockholders' equity..................................... 869,123 1,183,614
----------- -----------
Total liabilities and stockholders' equity................ $2,509,999 $2,013,379
=========== ===========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-27
<PAGE> 78

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

COMBINED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------
1994 1995 1996
---------- ---------- -----------
<S> <C> <C> <C>
Revenues.............................................. $8,308,840 $9,754,222 $12,501,885
Operating Expenses:
Cost of services.................................... 6,474,548 7,353,552 9,087,689
Selling, general and administrative expense......... 1,628,406 2,064,463 2,326,772
---------- ---------- -----------
Total operating expenses......................... 8,102,954 9,418,015 11,414,461
---------- ---------- -----------
Operating income................................. 205,886 336,207 1,087,424
Other Income (Expense):
Interest income..................................... 9,586 25,592 47,093
Interest expense.................................... (2,957) (6,914) (107)
Other income........................................ 14,024 34,537 41,941
---------- ---------- -----------
Other income, net................................ 20,653 53,215 88,927
---------- ---------- -----------
Income before provision for income taxes.............. 226,539 389,422 1,176,351
Provision for income taxes............................ 113,116 178,269 512,627
---------- ---------- -----------
Net income............................................ $ 113,423 $ 211,153 $ 663,724
========== ========== ===========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-28
<PAGE> 79

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COMMON STOCK TOTAL
------------------ TREASURY RETAINED STOCKHOLDERS'
SHARES AMOUNT STOCK EARNINGS EQUITY
------ ------- -------- ---------- -------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1993............ 2,056 $31,000 $ (4,185) $ 517,732 $ 544,547
Net income.......................... -- -- -- 113,423 113,423
----- ------- ------- ---------- ----------
Balance, December 31, 1994............ 2,056 31,000 (4,185) 631,155 657,970
Net income.......................... -- -- -- 211,153 211,153
----- ------- ------- ---------- ----------
Balance, December 31, 1995............ 2,056 31,000 (4,185) 842,308 869,123
Net income.......................... -- -- -- 663,724 663,724
Cash dividend....................... -- -- -- (349,233) (349,233)
----- ------- ------- ---------- ----------
Balance, December 31, 1996............ 2,056 $31,000 $ (4,185) $1,156,799 $ 1,183,614
===== ======= ======= ========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-29
<PAGE> 80

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

COMBINED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------
1994 1995 1996
--------- --------- ---------
<S> <C> <C> <C>
Cash Flows From Operating Activities:
Net income............................................ $ 113,423 $ 211,153 $ 663,724
Adjustments to reconcile net income to net cash
provided by operating activities --
Depreciation and amortization...................... 66,652 78,684 60,333
Gain on sale of assets............................. -- -- (500)
Change in operating assets and liabilities --
Accounts receivable.............................. (207,780) (154,680) (38,796)
Other assets..................................... 572 (30,978) 36,883
Accounts payable................................. (25,488) 53,404 9,695
Accrued expenses................................. 280,353 560,967 (761,206)
Deferred income taxes............................ (42,338) (98,307) 97,334
--------- --------- ---------
Net cash provided by operating activities..... 185,394 620,243 67,467
--------- --------- ---------
Cash Flows From Investing Activities:
Purchases of investments in short-term marketable
securities......................................... (134,501) (194,925) (330,887)
Sales of investments in short-term marketable
securities......................................... 27,888 151,076 397,934
Proceeds from sale of assets.......................... -- -- 4,507
Purchases of operating stock.......................... (76,610) (24,591) (77,642)
Purchases of property and equipment................... (30,341) (57,798) (28,012)
--------- --------- ---------
Net cash used in investing activities......... (213,564) (126,238) (34,100)
--------- --------- ---------
Cash Flows From Financing Activities:
Due to stockholders................................... 5,154 (1,920) (64,844)
Cash dividend......................................... -- -- (349,233)
Payments of notes payable............................. (10,318) -- --
Collections on notes receivable....................... -- -- 144,034
Additions to notes receivable......................... -- (154,602) --
--------- --------- ---------
Net cash used in financing activities......... (5,164) (156,522) (270,043)
--------- --------- ---------
Net (decrease) increase in cash and cash
equivalents................................. (33,334) 337,483 (236,676)
Cash and cash equivalents, beginning of year............ 530,466 497,132 834,615
--------- --------- ---------
Cash and cash equivalents, end of year.................. $ 497,132 $ 834,615 $ 597,939
========= ========= =========
Supplemental cash flow information:
Cash paid for interest........................ $ 2,957 $ 6,914 $ 107
========= ========= =========
Cash paid for income taxes.................... $ 25,264 $ 33,348 $ 828,618
========= ========= =========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-30
<PAGE> 81

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

The accompanying combined financial statements include the accounts of
Temporary Corporate Housing Columbus, Inc. and three affiliated entities in the
same business (collectively, "TCH" or the "Company"), substantially all of which
are commonly owned through a general partnership, the general partners of which
are all family members. The affiliated entities are Temporary Corporate Housing
Cincinnati, Inc., Temporary Corporate Housing Cleveland, Inc. and Temporary
Corporate Housing Pittsburgh, Inc. The Company was founded in 1983, and provides
fully-furnished apartments, townhouses, condominiums and, to a lesser extent,
homes (collectively, "accommodations") to individuals in need of flexible
accommodations. The Company has offices in four cities: Columbus, Cleveland and
Cincinnati, Ohio; and Pittsburgh, Pennsylvania.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these combined financial statements.

Use of Estimates

Principles of Combination

The accompanying combined financial statements include the accounts of
Temporary Corporate Housing Columbus, Inc. and three affiliated entities. All
significant intercompany accounts and transactions have been eliminated.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original
maturities of three months or less to be cash and cash equivalents. The fair
market value of the Company's financial instruments approximates their financial
statement carrying value.

Investments in Available-for-Sale Marketable Securities

Investments in available-for-sale short-term marketable securities are
stated at cost, which approximates market value.

Property and Equipment

F-31
<PAGE> 82

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

reporting and income tax reporting purposes over the estimated useful lives of
the respective assets. Estimated useful lives are as follows:

<TABLE>
<CAPTION>
ESTIMATED
USEFUL
ASSET CLASSIFICATION LIFE
------------------------------------------------------- ----------
<S> <C>
Computer equipment..................................... 1-5 Years
Office furniture and equipment......................... 5 Years
Automobiles............................................ 5 Years
</TABLE>

Repairs and maintenance are charged to expense as incurred. General and
administrative costs associated with the opening of new Company offices are
expenses as incurred.

Revenue Recognition

The Company recognizes revenues on the rentals of accommodations to its
clients on a pro rata basis over the length of the client's stay.

Concentration of Credit Risk

Concentration of credit risk is limited to accounts receivable. The Company
does not require collateral or other security to support their receivables. The
Company conducts periodic reviews of its clients' financial condition and
payment practices to minimize collection risks on accounts receivable.

Operating Stock

Operating stock to furnish new units, including linen, glassware,
silverware, utensils and minor appliances, is capitalized as it is purchased and
amortized over a three year period to a residual value of 50% of the original
cost. Additional purchases of operating stock for units already established is
expensed as incurred.

Accommodation and Furniture Leases

The Company leases substantially all of its accommodations on a short-term
basis with lease terms ranging from three months to one year. Furniture for the
accommodations is leased on a monthly basis from various furniture rental
companies, including a related party. (See Note 6)

3. INCOME TAXES

F-32
<PAGE> 83

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The provision (benefit) for income taxes consists of the following:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------
1994 1995 1996
-------- -------- ---------
<S> <C> <C> <C>
Current --
City and state.......................... $ 12,360 $ 13,964 $ 112,447
Federal................................. 58,418 65,998 531,441
-------- -------- ---------
70,778 79,962 643,888
-------- -------- ---------
Deferred --
City and state.......................... 7,394 17,168 (22,923)
Federal................................. 34,944 81,139 (108,338)
-------- -------- ---------
42,338 98,307 (131,261)
-------- -------- ---------
Total provision for income
taxes......................... $113,116 $178,269 $ 512,627
======== ======== =========
</TABLE>

A reconciliation between the provision for income taxes computed at the
statutory rates and the amount reflected in the accompanying combined statements
of operations is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1994 1995 1996
-------- -------- --------
<S> <C> <C> <C>
Computed expected federal tax provision for
the three years ended December 31, 1994,
1995 and 1996............................ $ 77,023 $132,403 $399,959
Increase in taxes resulting from --
City and state income taxes.............. 16,297 28,015 84,627
Other.................................... 19,796 17,851 28,041
-------- -------- --------
Provision for income taxes....... $113,116 $178,269 $512,627
======== ======== ========
</TABLE>

Deferred tax assets (liabilities) consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
Tax assets --
Accruals not yet deductible for tax purposes...... $255,217 $129,200
Net operating loss carryforward................... 17,391 --
Less -- valuation allowance............................ (17,391) --
-------- --------
255,217 129,200
-------- --------
Tax liabilities
Operating stock and prepaid supplies expensed for
tax purposes.................................... 102,500 107,744
-------- --------
Net deferred tax assets...................... $152,717 $ 21,456
======== ========
</TABLE>

The Company had no net operating loss ("NOL") carryforwards as of December
31, 1996. At December 31, 1995, the valuation allowance related to uncertainty
concerning the Company's ability to realize the NOL.

F-33
<PAGE> 84

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

4. PROPERTY AND EQUIPMENT; OPERATING STOCK

Property and equipment, and operating stock, consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
1995 1996
-------- ---------
<S> <C> <C>
Computer equipment............................................. $183,201 $169,577
Furniture and office equipment................................. 89,252 80,738
Automobiles.................................................... 62,084 57,584
-------- --------
Total property and equipment......................... 334,537 307,899
Less -- accumulated depreciation............................... 301,055 280,938
-------- --------
Property and equipment, net.......................... $ 33,482 $26,961
======== ========

Operating stock................................................ $398,570 $476,212
Less -- accumulated amortization............................... 178,319 208,126
-------- --------
Operating stock, net................................. $220,251 $268,086
======== ========
</TABLE>

5. LEASE COMMITMENTS

The Company leases administrative offices, accommodations and furniture at
several locations through August 31, 1999. Rent expense for the fiscal years
ended December 31, 1994, 1995 and 1996 was $4,965,215, $5,642,868 and
$6,998,444, respectively. Minimum future rental payments on noncancelable leases
at December 31, 1996 are as follows:

<TABLE>
<CAPTION>
OPERATING
LEASES
----------
<S> <C>
1997..................................................................... $ 969,826
1998..................................................................... 796,825
1999..................................................................... 806,518
2000..................................................................... 301,523
--------
Total.......................................................... $2,874,692
========
</TABLE>

6. RELATED PARTY TRANSACTIONS

For the period from November 1, 1992 until October 31, 1995, the Company
leased office space for its corporate headquarters located in Columbus, Ohio,
from a former owner of the Company and spouse of one the general partners of SLD
Partnership ("SLD"), an Ohio general partnership that owns substantially all of
the outstanding capital stock of the Company. The lease term and annual rental
amounts were comparable to the current lease agreement for the same premises
that the Company entered into, effective November 1, 1995, with an unaffiliated
entity. Rent expense related to this office space for the years ended December
31, 1994, 1995 and 1996 was $9,720, $10,200 and $11,378, respectively.

The Company has entered into an exclusive furniture lease agreement with
Integrity Furniture, Inc., which is 49% owned by SLD. The agreement was entered
into on September 12, 1995, has a five year period and provides that the lessor
will have the exclusive right to furnish all of the Company's leased
accommodations in Pittsburgh, Pennsylvania at agreed-upon prices. The initial
unit lease terms are for minimum three-month periods that then are renewable
monthly. In management's opinion, the lease terms and rental amounts are
comparable to other agreements that the Company has entered into with
unaffiliated entities.

F-34
<PAGE> 85

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

On October 15, 1995, the Company loaned to SLD $45,000 (included in related
party notes receivable as of December 31, 1995), at an annual interest rate of
7% beginning November 1995. Also in 1995 SLD borrowed $109,602 from the Company.
Both of these notes were repaid in full during 1996.

The Company leases televisions, VCRs and microwave ovens from Saturn
Enterprises, Inc. ("Saturn"), which is owned by the spouse of one of the general
partners of SLD. The original agreement commenced on January 1, 1989, and was
renewed on December 28, 1995 for a three-year period beginning on January 1,
1996. These items are rented at rates that are comparable to those charged by
unaffiliated companies. Included in accounts payable at December 31, 1995 and
1996 are amounts owed to Saturn of approximately $47,000 and $17,500,
respectively.

For the period from June 1992 until November 1996, the Company received
consulting services from two of the general partners of SLD. The cost incurred
for these services was $96,000 in each of 1994, 1995 and 1996. The consulting
contracts with the two general partners of SLD were terminated in November 1996.

7. PROFIT SHARING PLAN

Eligible employees of the Company participated in a profit sharing plan
(the "Plan") sponsored by the Company. This defined contribution plan provides
that the Company will make contributions to the Plan in its sole discretion. The
Company's contributions to the Plan amounted to approximately $43,523 in 1995.
The Plan was terminated by the Company on December 31, 1995. In accordance with
the provisions of the Plan agreement, all plan assets were distributed to the
participants during 1996.

8. CONTINGENCIES

The Company is a party to litigation in the ordinary course of business.
The Company does not anticipate an unfavorable result in any such litigation or
believe that an unfavorable result, if it occurred, would have a material
adverse effect on its business, financial condition and results of operations.

9. STOCKHOLDERS' EQUITY

Combined stockholders' equity includes the following common stock accounts
as of December 31, 1995 and 1996 (no par value for all classes of stock):

<TABLE>
<CAPTION>
OUTSTANDING
SHARES AMOUNT
----------- -------
<S> <C> <C>
Temporary Corporate Housing Columbus, Inc. --
Class A common stock --
Voting common stock authorized -- 500 shares.............. 500 $25,000
Class B common stock --
Nonvoting common stock authorized -- 500 shares........... 56 --
Temporary Corporate Housing Cleveland, Inc. --
Voting common stock authorized -- 500 shares.............. 500 500
Temporary Corporate Housing Cincinnati, Inc. --
Voting common stock authorized -- 500 shares.............. 500 5,000
Temporary Corporate Housing Pittsburgh, Inc. --
Voting common stock authorized -- 500 shares.............. 500 500
----- -------
2,056 $31,000
===== =======
</TABLE>

The treasury stock in the combined financial statements represents 40
shares of TCH Class B common stock purchased for $4,185.

F-35
<PAGE> 86

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

10. ACCRUED EXPENSES -- OTHER

Accrued expenses -- other includes an accrual for sales and use taxes of
$125,000 and $200,000 as of December 31, 1995 and 1996, respectively.

11. SALE OF COMPANY

Effective on January 2, 1997, the Company was acquired, through a stock for
stock merger, by Bridgestreet Accommodations, Inc. The stockholders of the
Company received 1,596,350 shares of Bridgestreet Accommodations, Inc.'s common
stock in exchange for all of the outstanding common stock of the Company.

F-36
<PAGE> 87

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of Corporate Lodgings, Inc.:

We have audited the accompanying combined balance sheets of Corporate
Lodgings, Inc., as of December 31, 1995 and 1996, and the related combined
statements of operations, stockholders' equity (deficit) and cash flows for each
of the three years in the period ended December 31, 1996. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Corporate Lodgings,
Inc. as of December 31, 1995 and 1996, and the combined results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1996, in conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
February 28, 1997

F-37
<PAGE> 88

CORPORATE LODGINGS, INC.

COMBINED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------
1995 1996
---------- ----------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents......................................... $ 343,231 $ 179,795
Accounts receivable -- trade, less allowance for doubtful accounts
of $29,689 and $43,172 in 1995, and 1996, respectively......... 376,317 604,098
Deferred income taxes............................................. 78,734 28,215
Prepaid expenses and other current assets......................... 217,793 126,116
---------- ----------
Total current assets...................................... 1,016,075 938,224
Property and equipment, net of accumulated depreciation........... 117,777 117,906
Notes receivable -- stockholder................................... 30,034 --
Other assets...................................................... 1,752 1,249
---------- ----------
Total assets.............................................. $1,165,638 $1,057,379
========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable.................................................. $ 186,859 $ 282,436
Accrued expenses --
Payroll, bonuses and related items............................. 275,007 65,238
Other.......................................................... 59,566 92,631
Accrued income taxes.............................................. 125,104 76,093
Current portion of notes payable.................................. 28,893 9,720
Notes payable -- stockholder...................................... 194,015 28,493
Deferred revenue.................................................. 371,283 427,987
---------- ----------
Total current liabilities................................. 1,240,727 982,598
Notes payable....................................................... 9,720 --
Commitments and contingencies
Stockholders' Equity (Deficit):
Common stock...................................................... 5,000 5,000
Additional paid-in capital........................................ 800 179,797
Accumulated deficit............................................... (90,609) (110,016)
---------- ----------
Total stockholders' equity (deficit)........................... (84,809) 74,781
---------- ----------
Total liabilities and stockholders' equity (deficit)...... $1,165,638 $1,057,379
========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-38
<PAGE> 89

CORPORATE LODGINGS, INC.

COMBINED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1994 1995 1996
---------- ---------- ----------
<S> <C> <C> <C>
Revenues............................................... $4,069,094 $6,067,389 $8,820,039
---------- ---------- ----------
Operating Expenses:
Cost of services..................................... 2,744,916 4,046,624 6,105,473
Selling, general and administrative expense.......... 1,237,403 1,981,852 2,519,435
---------- ---------- ----------
Total operating expenses.......................... 3,982,319 6,028,476 8,624,908
---------- ---------- ----------
Operating income.................................. 86,775 38,913 195,131
Other Income (Expense):
Interest income...................................... 1,992 1,646 1,284
Interest expense..................................... (6,851) (14,615) (26,625)
Other income (expense), net.......................... (2,491) 504 (180,449)
---------- ---------- ----------
Other expense, net................................ (7,350) (12,465) (205,790)
---------- ---------- ----------
Income (loss) before provision for income taxes... 79,425 26,448 (10,659)
Provision for income taxes............................. 50,454 47,463 8,748
---------- ---------- ----------
Net income (loss)...................................... $ 28,971 $ (21,015) $ (19,407)
========== ========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-39
<PAGE> 90

CORPORATE LODGINGS, INC.

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
TOTAL
COMMON STOCK ADDITIONAL STOCKHOLDERS'
--------------------- PAID-IN ACCUMULATED EQUITY
SHARES AMOUNT CAPITAL DEFICIT (DEFICIT)
--------- --------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1993............ 1,450 $ 3,000 $ 800 $ (98,565) $ (94,765)
Net income.......................... -- -- -- 28,971 28,971
Issuance of stock................... 100 1,000 -- -- 1,000
----- ------ -------- --------- --------
Balance, December 31, 1994............ 1,550 4,000 800 (69,594) (64,794)
Net loss............................ -- -- -- (21,015) (21,015)
Issuance of stock................... 100 1,000 -- -- 1,000
----- ------ -------- --------- --------
Balance, December 31, 1995............ 1,650 5,000 800 (90,609) (84,809)
Net loss............................ -- -- -- (19,407) (19,407)
Capital contribution................ -- -- 178,997 -- 178,997
----- ------ -------- --------- --------
Balance, December 31, 1996............ 1,650 $ 5,000 $ 179,797 $(110,016) $ 74,781
===== ====== ======== ========= ========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-40
<PAGE> 91

CORPORATE LODGINGS, INC.

COMBINED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------
1994 1995 1996
-------- --------- ---------
<S> <C> <C> <C>
Cash Flows From Operating Activities:
Net (loss) income...................................... $ 28,971 $ (21,015) $ (19,407)
Adjustments to reconcile net (loss) income to net cash
(used in) provided by operating activities --
Depreciation and amortization....................... 16,376 36,496 52,970
Change in operating assets and liabilities --
Accounts receivable............................... (43,184) (145,204) (227,781)
Deferred income taxes............................. (1,346) (36,580) 50,519
Prepaid expenses and other current assets......... (10,206) (141,831) 91,677
Accounts payable.................................. (67,939) 98,767 95,577
Accounts payable -- stockholder................... 72,468 (11,544) --
Accrued expenses.................................. 47,090 209,822 (176,704)
Accrued income taxes.............................. 20,217 76,525 (49,011)
Deferred income................................... 16,665 151,041 56,704
Other............................................. (379) (434) --
------- ------- -------
Net cash provided by (used in) operating
activities................................... 78,733 216,043 (125,456)
------- ------- -------
Cash Flows From Investing Activities:
Purchases of property and equipment.................... (26,159) (94,032) (53,953)
Other.................................................. -- -- 1,357
------- ------- -------
Net cash used in investing activities.......... (26,159) (94,032) (52,596)
------- ------- -------
Cash Flows From Financing Activities:
Cash received from notes receivable -- stockholder..... 1,648 5,576 30,034
Issuance (payments) of notes payable, net.............. 13,642 11,303 (15,418)
Issuance (payments) of notes payable -- stockholder.... -- 112,000 --
Issuance of common stock............................... 1,000 1,000 --
------- ------- -------
Net cash provided by financing activities...... 16,290 129,879 14,616
------- ------- -------
Net (decrease) increase in cash and cash equivalents..... 68,864 251,890 (163,436)
Cash and cash equivalents, beginning of year............. 22,477 91,341 343,231
------- ------- -------
Cash and cash equivalents, end of year................... $ 91,341 $ 343,231 $ 179,795
======= ======= =======
Supplemental Cash Flow Information:
Cash paid for interest......................... $ 6,851 $ 14,615 $ 25,675
======= ======= =======
Cash paid for income taxes..................... $ 31,583 $ 7,518 $ 14,726
======= ======= =======
</TABLE>

Non-Cash Transaction:

In 1996 the stockholder contributed to capital a note payable to the
stockholder for $178,977.

The accompanying notes are an integral part of these combined financial
statements.

F-41
<PAGE> 92

CORPORATE LODGINGS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

The accompanying combined financial statements include the accounts of
Corporate Lodgings, Inc., a C corporation, and four S corporations which all are
owned substantially by the same individual and operate similar businesses
(collectively, the "Company"). The four S corporations are Corporate Lodgings,
Pennsylvania Inc.; Corporate Lodgings, Minnesota Inc.; Corporate Lodgings,
Kentucky Inc.; and Corporate Lodgings, Wisconsin Inc. The Company was founded in
1987 and provides fully-furnished apartments, townhouses, condominiums and, to a
lesser extent, homes (collectively, "accommodations") to individuals in need of
flexible accommodations. The Company has offices in: Ohio, Pennsylvania,
Minnesota, Kentucky and Wisconsin.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these combined financial statements.

Use of Estimates

Principles of Combination

The accompanying combined financial statements include the accounts of
Corporate Lodgings, Inc. and four affiliated entities which are under common
control of and management by a single shareholder. All significant intercompany
accounts and transactions have been eliminated.

Cash and Cash Equivalents

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Upon sale or retirement, the related cost and accumulated depreciation are
removed from the accounts, and any gain or loss is recorded in the combined
statements of operations. Depreciation is determined using the straight-line
method for financial reporting purposes and accelerated methods for income tax
reporting purposes over the estimated useful lives of the respective assets.
Estimated useful lives are as follows:

<TABLE>
<CAPTION>
ESTIMATED
ASSET CLASSIFICATION USEFUL LIFE
------------------------------------------------------------------ -----------
<S> <C>
Computer equipment................................................ 3 Years
Office furniture and equipment.................................... 5 Years
</TABLE>

Repairs and maintenance are charged to expense as incurred. General and
administrative costs associated with the opening of new company offices are
expensed as incurred.

F-42
<PAGE> 93

CORPORATE LODGINGS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Revenue Recognition

The Company records cash payments from clients in advance of their stays as
deferred revenue and recognizes these amounts as revenue on a pro rata basis
over the length of the guests' stays.

Concentration of Credit Risk

Operating Stock

The Company leases operating stock such as linens, small appliances,
glassware, silverware, dishes, etc.

Accommodation and Furniture Leases

The Company leases substantially all of its accommodations on a short-term
basis with lease terms that range from three months to one year. Furniture for
the accommodations is leased on a monthly basis from various furniture rental
companies.

3. INCOME TAXES

The provision for income taxes consists of the following:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------
1994 1995 1996
------- -------- --------
<S> <C> <C> <C>
Current provision (benefit) --
State............................................. $10,403 $ 16,142 $ (3,189)
Federal........................................... 38,897 61,501 (12,311)
------- ------- --------
49,300 77,643 (15,500)
------- ------- --------
Deferred provision (benefit) --
State............................................. 171 (4,463) 3,586
Federal........................................... 983 (25,717) 20,662
------- ------- --------
1,154 (30,180) 24,248
------- ------- --------
Total provision for income taxes.......... $50,454 $ 47,463 $ 8,748
======= ======= ========
</TABLE>

F-43
<PAGE> 94

CORPORATE LODGINGS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

A reconciliation between the provision for income taxes computed at the
statutory rates and the amount reflected in the accompanying combined statements
of operations is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------
1994 1995 1996
------- ------- -------
<S> <C> <C> <C>
Computed expected federal tax provision (benefit)..... $27,005 $ 8,992 $(3,624)
Increase (decrease) in taxes resulting from --
Impact of S corporation not taxable................. 13,908 29,699 4,470
State income taxes, net of federal benefit.......... 5,141 2,547 (4,355)
Other............................................... 4,400 6,225 12,257
------- ------- -------
Provision for income taxes.................. $50,454 $47,463 $ 8,748
======= ======= =======
</TABLE>

Deferred tax assets (liabilities) consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1995 1996
--------- ---------
<S> <C> <C>
Tax Assets:
Accruals................................................... $ 117,550 $ 152,152
Other...................................................... 63,750 178,641
--------- ---------
181,300 330,793
--------- ---------
Tax Liabilities:
Receivables................................................ (73,016) (251,205)
Other...................................................... (29,550) (51,373)
--------- ---------
(102,566) (302,578)
--------- ---------
Net deferred tax asset............................. $ 78,734 $ 28,215
========= =========
</TABLE>

4. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
Computer equipment............................................. $127,281 $159,835
Furniture and office equipment................................. 48,734 65,555
-------- --------
Total property and equipment......................... 176,015 225,390
Less -- accumulated depreciation............................... 58,238 107,484
-------- --------
Property and equipment, net.......................... $117,777 $117,906
======== ========
</TABLE>

5. NOTES PAYABLE

As of December 31, 1995 and 1996, the Company had $38,613 and $9,720,
respectively, of notes payable outstanding, related in part to the purchase of
computer equipment. The notes bear interest at rates ranging from 6.75% to 9.75%
and are secured by all business assets. All such outstanding notes mature in
1997.

F-44
<PAGE> 95

CORPORATE LODGINGS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

6. RELATED PARTY TRANSACTIONS

Notes Receivable -- Stockholder

As of December 31, 1995, the Company held notes receivable from the
majority stockholder of $30,034. All of such notes are non-interest-bearing with
the exception of one, which bears interest at 5.69%. Included in the
accompanying statements of operations is $1,114, $1,023 and $854 of interest
income related to these notes for the years ended December 31, 1994, 1995 and
1996, respectively. These notes were repaid in 1996.

Notes Payable -- Stockholder

As of December 31, 1995 and 1996, the Company had $194,015 and $28,493
respectively, of notes payable due to the majority stockholder. The notes bear
interest at rates ranging from 6.75% and 9.75% and are payable on demand.
Interest expense for the fiscal years ended December 31, 1994, 1995 and 1996 of
$3,873, $10,943 and $24,168, respectively, related to these notes is included in
the accompanying statements of operations.

Contingent Liabilities

During 1995, the Company entered into an agreement to guarantee a
promissory note of the majority stockholder. As of December 31, 1995 and 1996,
there was $25,000 outstanding on the note. In addition, during December 1995,
the Company pledged the inventory, accounts receivable, contract rights,
equipment and general intangibles of one of the affiliated companies to secure a
$200,000 promissory note between the majority stockholder and a bank. As of
December 31, 1995 and 1996, there was $137,000 and $109,000, respectively,
outstanding on the promissory note.

City Visitor

The Company purchases advertising space from City Visitor Publications,
Inc. ("City Visitor"), an entity which publishes a travel magazine and is 100%
owned by the majority stockholder of the Company. Included in the accompanying
statements of operations is $34,048, $21,780 and $31,356 of advertising expense
paid to City Visitor in 1994, 1995, and 1996, respectively. In addition, the
Company will from time to time pay expenses on behalf of City Visitor which are
subsequently repaid to the Company by City Visitor. Included in accounts payable
in the accompanying balance sheet is approximately $866 and $1,790 as of
December 31, 1995 and 1996, respectively.

In addition, the Company performed certain general and administrative
functions, such as accounting and finance, on behalf of City Visitor. In
connection with these services, the Company billed City Visitor approximately
$42,200, $51,000 and $14,500 for the years ended December 31, 1994, 1995 and
1996, respectively.

7. LEASE COMMITMENTS

The Company leases administrative offices, accommodations and furniture at
several locations through January 1998. The terms of the leases of
accommodations are typically less than one year. Rent expense for the fiscal
years ended December 31, 1994, 1995 and 1996 was $1,575,031, $2,317,274 and
$3,518,705, respectively. Minimum future rental payments at December 31, 1996
are as follows:

<TABLE>
<CAPTION>
OPERATING
LEASES
---------
<S> <C>
1997...................................................... $ 78,583
1998...................................................... 61,558
1999...................................................... 3,834
-------
Total..................................................... $ 143,975
=======
</TABLE>

F-45
<PAGE> 96

CORPORATE LODGINGS, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

8. PENSION PLAN

Eligible employees of the Company participate in a defined contribution
profit sharing plan sponsored by the Company. The plan provides that the Company
may make discretionary contributions to the plan. For the years ended December
31, 1994, 1995 and 1996, the Company did not make any discretionary
contributions to the plan.

9. STOCKHOLDERS' EQUITY

Combined stockholders' equity includes the following common stock accounts
as of December 31, 1995 and 1996.

<TABLE>
<CAPTION>
OUTSTANDING
SHARES AMOUNT
----------- ------
<S> <C> <C>
Corporate Lodgings, Inc.:
No par value, voting common stock, 1,750 shares authorized.... 1,250 $1,000
Corporate Lodgings, Pennsylvania:
No par value, voting common stock, 750 shares authorized... 100 1,000
Corporate Lodgings, Minnesota:
No par value, voting common stock, 750 shares authorized... 100 1,000
Corporate Lodgings, Kentucky:
No par value, voting common stock, 750 shares authorized... 100 1,000
Corporate Lodgings, Wisconsin:
No par value, voting common stock, 750 shares authorized... 100 1,000
----- ------
1,650 $5,000
===== ======
</TABLE>

10. CONTINGENCIES

Various lawsuits have arisen in the ordinary course of the Company's
business. The Company does not anticipate an unfavorable result in any such
litigation or believe that an unfavorable result, if it occurred, would have a
material adverse effect on its business, financial condition and results of
operations.

11. OTHER INCOME (EXPENSE), NET

Included in other income (expense) for the year ended December 31, 1996 is
approximately $160,000 for services rendered by an outside consultant related to
the sale of the Company.

12. SALE OF COMPANY

Effective on January 2, 1997, the Company was acquired, through a stock for
stock merger, by BridgeStreet Accommodations, Inc. The stockholders of the
Company received 836,437 shares of BridgeStreet Accommodations, Inc.'s common
stock in exchange for all of the outstanding common stock of the Company.

F-46
<PAGE> 97

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of Exclusive Interim Properties, Ltd.:

We have audited the accompanying combined balance sheets of Exclusive
Interim Properties, Ltd. as of March 31, 1996 and as of December 31, 1996, and
the related combined statements of operations, stockholders' equity and cash
flows for each of the two years in the period ended March 31, 1996 and for the
nine month period ended December 31, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Exclusive Interim
Properties, Ltd. as of March 31, 1996 and December 31, 1996, and the combined
results of their operations and their cash flows for each of the two years in
the period ended March 31, 1996 and for the nine month period ended December 31,
1996, in conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
March 11, 1997

F-47
<PAGE> 98

EXCLUSIVE INTERIM PROPERTIES, LTD.

COMBINED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER
MARCH 31, 31,
1996 1996
---------- ----------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents......................................... $ 32,284 $ --
Accounts receivable -- trade
less allowance for doubtful accounts of $25,191 and
$107,191 at March 31, 1996 and December 31, 1996, 158,664 405,244
respectively..................................................
Other receivables................................................. 23,913 12,384
Security deposits held by landlord................................ 85,473 150,614
Deferred income taxes............................................. 143,058 166,650
---------- ----------
Total current assets........................................... 443,392 734,892
Operating stock, net of accumulated amortization.................... 381,852 580,394
Land, property and equipment, net of accumulated depreciation....... 1,367,371 1,391,834
Other assets........................................................ 10,504 7,950
---------- ----------
Total assets................................................... $2,203,119 $2,715,070
========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable.................................................. $ 296,444 $ 366,004
Accrued expenses
Payroll, bonuses and related items............................. 18,852 15,308
Other.......................................................... 98,750 202,575
Deferred revenue.................................................. 123,138 155,313
Security deposits due to customers................................ 117,475 260,443
Current portion of long-term debt................................. 70,080 136,579
Notes payable-stockholder......................................... 110,549 94,655
---------- ----------
Total current liabilities...................................... 835,288 1,230,877
Deferred income taxes............................................... 152,741 232,168
Long-term debt, net of current maturities........................... 1,113,921 1,049,038
Commitments and contingencies
Stockholders' Equity:
Common stock...................................................... 20 20
Additional paid in capital........................................ 50,200 75,801
Retained earnings................................................. 50,949 127,166
---------- ----------
Total stockholders' equity..................................... 101,169 202,987
---------- ----------
Total liabilities and stockholders' equity................ $2,203,119 $2,715,070
========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-48
<PAGE> 99

EXCLUSIVE INTERIM PROPERTIES, LTD.

COMBINED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED MARCH 31, ENDED
------------------------- DECEMBER 31,
1995 1996 1996
---------- ---------- ------------
<S> <C> <C> <C>
Revenues.............................................. $4,014,541 $5,521,373 $7,136,843
Operating Expenses:
Cost of services.................................... 3,015,261 4,246,342 5,789,975
Selling, general and administrative expense......... 895,109 975,186 1,110,249
---------- ---------- ----------
Total operating expenses......................... 3,910,370 5,221,528 6,900,224
---------- ---------- ----------
Operating income................................. 104,171 299,845 236,619
Other Income (Expense):
Interest income..................................... 3,195 -- 29
Interest expense.................................... (110,726) (133,025) (95,974)
---------- ---------- ----------
Other expense, net............................... (107,531) (133,025) (95,945)
---------- ---------- ----------
Income (loss) before provision (benefit) for income
taxes............................................... (3,360) 166,820 140,674
Provision (benefit) for income taxes.................. (18,466) 57,723 64,457
---------- ---------- ----------
Net income............................................ $ 15,106 $ 109,097 $ 76,217
========== ========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-49
<PAGE> 100

EXCLUSIVE INTERIM PROPERTIES, LTD.

COMBINED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
TOTAL
COMMON STOCK ADDITIONAL RETAINED STOCKHOLDERS'
----------------- PAID-IN EARNINGS EQUITY
SHARES AMOUNT CAPITAL (DEFICIT) (DEFICIT)
------ ------ ---------- -------- -------------
<S> <C> <C> <C> <C> <C>
Balance, March 31, 1994................ 2,000 $ 20 $ 40,500 $(73,254) $ (32,734)
Contributions........................ -- -- 2,600 -- 2,600
Net income........................... -- -- -- 15,106 15,106
----- --- -------- -------- --------
Balance, March 31, 1995................ 2,000 20 43,100 (58,148) (15,028)
Contributions........................ -- -- 50,000 -- 50,000
Withdrawals.......................... -- -- (42,900) -- (42,900)
Net income........................... -- -- -- 109,097 109,097
----- --- -------- -------- --------
Balance, March 31, 1996................ 2,000 20 50,200 50,949 101,169
Contributions........................ -- -- 56,100 -- 56,100
Withdrawals.......................... -- -- (30,499) -- (30,499)
Net income........................... -- -- -- 76,217 76,217
----- --- -------- -------- --------
Balance, December 31, 1996............. 2,000 $ 20 $ 75,801 $127,166 $ 202,987
===== === ======== ======== ========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-50
<PAGE> 101

EXCLUSIVE INTERIM PROPERTIES, LTD.

COMBINED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED MARCH 31, ENDED
------------------------- DECEMBER 31,
1995 1996 1996
----------- --------- ------------
<S> <C> <C> <C>
Cash Flows From Operating Activities:
Net income.......................................... $ 15,106 $ 109,097 $ 76,217
Adjustments to reconcile net income to net cash
provided by operating activities --
Depreciation and amortization.................... 70,149 118,131 116,218
Provision for bad debts.......................... -- 25,191 82,000
Change in operating assets and liabilities
Accounts receivable............................ (19,981) (145,513) (317,051)
Security deposits held by landlord............. (32,230) (32,753) (65,141)
Accounts payable............................... (22,061) 196,063 69,560
Deferred revenue............................... 71,172 23,988 32,175
Security deposits due to customers............. 10,100 29,150 142,968
Accrued expenses............................... 59,803 21,194 100,281
Other.......................................... 20,769 58,306 55,836
----------- --------- ---------
Net cash provided by operating activities... 172,827 402,854 293,063
----------- --------- ---------
Cash Flows From Investing Activities:
Purchases of operating stock........................ (37,782) (323,287) (278,487)
Purchases of property and equipment................. (1,377,093) (10,164) (58,183)
----------- --------- ---------
Net cash used in investing activities....... (1,414,875) (333,451) (336,670)
----------- --------- ---------
Cash Flows From Financing Activities:
Due to stockholder.................................. 82,265 (11,716) (15,894)
Proceeds from long-term debt........................ 1,191,600 -- 71,266
Principal payments of long-term debt................ -- (69,266) (69,650)
Capital contributions............................... 2,600 50,000 56,100
Distributions to stockholder........................ -- (42,900) (30,499)
----------- --------- ---------
Net cash provided by (used in) financing
activities................................ 1,276,465 (73,882) 11,323
----------- --------- ---------
Net (decrease) increase in cash and cash
equivalents......................................... 34,417 (4,479) (32,284)
Cash and cash equivalents, beginning of period........ 2,346 36,763 32,284
----------- --------- ---------
Cash and cash equivalents, end of period.............. $ 36,763 $ 32,284 $ --
=========== ========= =========
Supplemental Cash Flow Information:
Cash paid for interest...................... $ 99,726 $ 133,025 $ 92,391
=========== ========= =========
Cash paid for income taxes.................. $ -- $ 1,273 $ --
=========== ========= =========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-51
<PAGE> 102

EXCLUSIVE INTERIM PROPERTIES, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

The accompanying combined financial statements include the accounts of
Exclusive Interim Properties, Ltd., which is owned by a sole stockholder, and
Haus Account, LLC (the "LLC") and an individual condominium unit, each of which
are owned by the sole stockholder of EIP and her spouse (collectively, the
"Company"). These entities and the condominium unit are involved in the same
business. The Company was founded in 1987 and provides fully-furnished
apartments, townhouses, condominiums and, to a lesser extent, homes
(collectively, "accommodations") to individuals in need of flexible
accommodations. The Company has offices in Baltimore, Maryland; and Washington,
D.C.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these combined financial statements.

Use of Estimates

Principles of Combination

The accompanying combined financial statements include the accounts of
Exclusive Interim Properties, Ltd. and one affiliated entity. All significant
intercompany accounts and transactions have been eliminated.

Cash and Cash Equivalents

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Upon sale or retirement, the related cost and accumulated depreciation are
removed from the accounts, and any gain or loss is recorded in the combined
statements of operations. Depreciation is computed on the straight-line method
over estimated useful lives for financial reporting purposes. For income tax
reporting purposes, depreciation on equipment is determined using the
double-declining balance method. Condominiums are depreciated using the
straight-line method for financial reporting and income tax reporting purposes
over the estimated useful life of the units. Estimated useful lives are as
follows:

<TABLE>
<CAPTION>
ASSET CLASSIFICATION ESTIMATED USEFUL LIFE
---------------------------------------------------------- ---------------------
<S> <C>
Computer equipment........................................ 3 years
Office furniture and equipment............................ 7 years
Condominiums.............................................. 39 years
Vehicles.................................................. 5 years
Leasehold improvements.................................... Lease life
</TABLE>

Repairs and maintenance are charged to expense as incurred. General and
administrative costs associated with the opening of new company offices are
expensed as incurred.

F-52
<PAGE> 103

EXCLUSIVE INTERIM PROPERTIES, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Revenue Recognition

The Company records cash payments from clients in advance of their stay as
Deferred Revenue and recognizes these amounts as revenue on a pro rata basis
over the length of the guests' stays.

Concentration of Credit Risk

Concentration of credit risk is limited to accounts receivable. The Company
does not require collateral or security to support their receivables. The
Company conducts periodic reviews of its clients' financial condition and
payment practices to minimize collection risk on accounts receivable.

Operating Stock

Operating stock to furnish new apartment units, including linens,
glassware, silverware, utensils, and small appliances, is capitalized as it is
purchased and amortized over a three-year period to a residual value of 50% of
its original cost. Additional purchases of operating stock for apartment units
already established is expensed as incurred.

Accommodation and Furniture Leases

3. INCOME TAXES

The provision (benefit) for income taxes consists of the following:

<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
-------------------- DECEMBER 31,
1995 1996 1996
-------- -------- ------------
<S> <C> <C> <C>
Total provision (benefit) for income taxes:
State............................................ $ (7,673) $ 13,294 $ 14,390
Federal.......................................... (56,467) 97,833 105,902
------- ------- --------
(64,140) 111,127 120,292
------- ------- --------
Deferred
State............................................ 5,464 (6,389) (6,679)
Federal.......................................... 40,210 (47,015) (49,156)
------- ------- --------
45,674 (53,404) (55,835)
------- ------- --------
Total provision (benefit) for income
taxes.................................. $(18,446) $ 57,723 $ 64,457
======= ======= ========
</TABLE>

Income taxes are not provided on the portion of income related to the LLC
because those taxes are paid by the partners.

F-53
<PAGE> 104

EXCLUSIVE INTERIM PROPERTIES, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

A reconciliation between the provision for income taxes computed at the
statutory rates and the amount reflected in the accompanying combined statements
of operations for the two years ended March 31, 1996 and the nine months ended
December 31, 1996 is as follows:

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED MARCH 31, ENDED
-------------------- DECEMBER 31,
1995 1996 1996
-------- -------- ------------
<S> <C> <C> <C>
Computed expected federal tax provision............ $ (1,142) $ 56,719 $ 47,829
Increase (decrease) in taxes resulting from:
State income taxes............................... (222) 11,010 9,284
Deductions taken for books not allowed for tax
purposes...................................... 3,941 4,053 3,400
LLC income not taxable........................... (14,996) (11,531) (4,373)
Other............................................ (6,047) (2,528) 8,317
-------- -------- --------
Provision (benefit) for income taxes..... $(18,466) $ 57,723 $ 64,457
======== ======== ========
</TABLE>

The Company uses the cash basis method for its tax returns. Deferred tax
(assets) liabilities consist of the following:

<TABLE>
<CAPTION>
MARCH 31, 1996 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
Tax assets:
Payables and accruals not yet deducted for tax
purposes......................................... 214,874 295,680
Net operating loss carry forwards................... -- 39,638
------- -------
214,874 335,318
------- -------
Tax liabilities:
Accounts receivable not yet reported for tax
purposes......................................... (63,466) (162,098)
Operating stock expensed for tax purposes........... (152,741) (232,158)
Other............................................... (8,350) (6,580)
------- -------
(224,557) (400,836)
------- -------
Net deferred tax liabilities................ (9,683) (65,518)
======= =======
</TABLE>

The Company has net operating loss carryforwards of $99,000 as of December
31, 1996.

4. LAND, PROPERTY AND EQUIPMENT; OPERATING STOCK

Land, property and equipment, and operating stock consist of the following:

<TABLE>
<CAPTION>
MARCH 31, 1996 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
Land.................................................. $ 266,235 $ 266,235
Condominiums.......................................... 1,166,700 1,166,700
Leasehold improvements & vehicles..................... -- 30,992
Computer equipment.................................... 37,392 64,582
Furniture and office equipment........................ 66,266 66,266
---------- ----------
Total land, property and equipment.......... 1,536,593 1,594,775
Less -- accumulated depreciation...................... 169,222 202,941
---------- ----------
Land, property and equipment, net........... $1,367,371 $1,391,834
========== ==========
Operating stock....................................... $ 535,583 $ 814,070
Less -- accumulated amortization...................... 153,731 233,676
---------- ----------
Operating stock, net........................ $ 381,852 $ 580,394
========== ==========
</TABLE>

F-54
<PAGE> 105

EXCLUSIVE INTERIM PROPERTIES, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

5. LONG-TERM DEBT

A summary of long-term debt is as follows:

<TABLE>
<CAPTION>
MARCH 31, 1996 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
Mortgage note -- LLC.................................. $ 975,520 $ 962,935
Installment note -- LLC............................... 150,000 100,000
Mortgage notes -- stockholder......................... 58,481 56,182
Revolving lines of credit............................. -- 49,817
Automobile loan....................................... -- 16,683
---------- ----------
Total....................................... 1,184,001 1,185,617
Less-current maturities............................... 70,080 136,579
---------- ----------
Total long-term debt........................ $1,113,921 $ 1,049,038
========== ==========
</TABLE>

Mortgage Note -- LLC

On May 12, 1994, the LLC entered into a Mortgage note agreement with a
bank, under which the bank provided cash of $1,005,000 in exchange for a
$1,005,000 Mortgage note (the "Mortgage"). The Mortgage is secured by
substantially all assets of the LLC, including 18 condominiums owned by the LLC.
The Mortgage calls for monthly principal payments of $1,340 through June 1, 1999
at which time all outstanding borrowings are due. The Mortgage bears interest at
bank's prime rate plus 1.5%. The interest rates at both March 31, 1996 and
December 31, 1996 were 9.75%. Interest is payable monthly, in arrears.

Installment Note -- LLC

On May 12, 1994, the LLC entered into an agreement with a bank, pursuant to
which the bank provided the LLC with cash of $200,000 in exchange for a $200,000
installment note (the "Installment Note"). The Installment Note calls for annual
principal payments of $50,000, from May 1, 1995 through May 1, 1998. The
Installment Note bears interest at the highest prime rate published in the Wall
Street Journal on the last day of the immediately prior calendar month plus
1.5%. The interest rate at both March 31, 1996 and December 31, 1996 was 9.75%.
Interest is payable monthly, in arrears.

Mortgage -- Stockholder

On October 22, 1993, the principal stockholder of the Company entered into
a mortgage note agreement for $65,000. The mortgage is secured by a condominium
owned by the stockholder located in Baltimore, Maryland. The mortgage calls for
monthly payments of principal and interest in the amount of $590. The mortgage
bears interest at a fixed rate of 7.0%. The mortgage and the condominium were
contributed by the stockholder to the Company.

Revolving Lines of Credit

At December 31, 1996, the Company had a line of credit agreement expiring
February 15, 1997 which provided for borrowings of up to $50,000 and bore
interest at 8.25% on such date. At December 31, 1996, the Company's advances on
this line of credit were $49,817.

Automobile Loan

In April 1996, the Company entered into a note payable agreement for
$21,000 with Chrysler Financial Group. The note calls for monthly payments of
principal and interest of $570 through April 1999. The note bears interest at a
fixed rate of 8.55%.

F-55
<PAGE> 106

EXCLUSIVE INTERIM PROPERTIES, LTD.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The following is a schedule of required debt payments as of December 31,
1996:

<TABLE>
<CAPTION>
YEAR AMOUNT
--------------------------------------------------------- ----------
<S> <C>
1997..................................................... $ 136,579
1998..................................................... 70,080
1999..................................................... 935,300
2000..................................................... 4,000
2001..................................................... 4,000
Thereafter............................................... 35,658
----------
Total.......................................... $1,185,617
==========
</TABLE>

6. LEASE COMMITMENTS

The Company leases administrative offices, accommodations and furniture at
several locations through August 31, 1999. Rent expense for the fiscal years
ended March 31, 1995 and 1996 and for the nine months ended December 31, 1996
was $2,183,491, $3,240,935 and $4,102,087, respectively. Minimum future rental
payments at December 31, 1996 are as follows:

<TABLE>
<CAPTION>
OPERATING
LEASES
---------
<S> <C>
1997...................................................... $ 57,212
1998...................................................... 56,522
1999...................................................... 48,526
2000...................................................... 50,088
2001...................................................... 41,741
--------
Total........................................... $ 254,089
========
</TABLE>

7. CONTINGENCIES

8. SALE OF COMPANY

Effective on January 2, 1997, the Company was acquired, through a stock for
stock merger, by BridgeStreet Accommodations, Inc. The stockholders of the
Company received 1,001,805 shares of BridgeStreet Accommodations, Inc.'s common
stock in exchange for all of the outstanding common stock of and equity
interests in the Company.

F-56
<PAGE> 107

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholder of Home Again, Inc.:

We have audited the accompanying combined balance sheets of Home Again,
Inc. as of December 31, 1995 and 1996, and the related combined statements of
operations, stockholder's equity and cash flows for each of the two years in the
period ended December 31, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the combined financial statements. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Home Again, Inc. as
of December 31, 1995 and 1996, and the results of their operations and their
cash flows for each of the two years in the period ended December 31, 1996, in
conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
March 21, 1997

F-57
<PAGE> 108

HOME AGAIN, INC.

COMBINED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents............................................ $ 14,210 $145,140
Accounts receivable.................................................. 68,905 109,167
Security deposits held by landlords.................................. 6,801 7,553
Prepaid expenses..................................................... 131,325 217,172
Other current assets................................................. 1,774 1,293
-------- --------
Total current assets.............................................. 223,015 480,325
Operating stock, net of accumulated amortization....................... 35,966 196,015
Property and equipment, net of accumulated depreciation................ 68,759 142,508
-------- --------
Total assets................................................. $327,740 $818,848
======== ========

LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Accounts payable..................................................... $191,119 $300,755
Accrued expenses --
Payroll and employee benefits..................................... 6,977 290
Other............................................................. 42,500 64,750
Deferred revenue..................................................... 20,850 30,880
Security deposits due to customers................................... -- 60,460
Due to stockholder................................................... 2,812 191,404
Current portion of long-term debt.................................... -- 8,595
-------- --------
Total current liabilities......................................... 264,258 657,134
Long-term debt, net of current maturities.............................. -- 25,608
Commitments and Contingencies

Stockholder's Equity:
Common stock......................................................... 30 30
Additional paid-in capital........................................... 2,970 2,970
Retained earnings.................................................... 60,482 133,106
-------- --------
Total stockholder's equity........................................ 63,482 136,106
-------- --------
Total liabilities and stockholder's equity................... $327,740 $818,848
======== ========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-58
<PAGE> 109

HOME AGAIN, INC.

COMBINED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------
1995 1996
---------- ----------
<S> <C> <C>
Revenues............................................................ $1,569,502 $4,034,905
Operating Expenses:
Cost of services.................................................. 1,283,752 3,133,900
Selling, general and administrative expense....................... 212,242 586,339
---------- ----------
Total operating expenses....................................... 1,495,994 3,720,239
---------- ----------
Operating income............................................... 73,508 314,666
Other Income:
Interest income................................................... 362 1,202
Other income...................................................... 33,042 75,702
---------- ----------
Other income, net.............................................. 33,404 76,904
---------- ----------
Net income.......................................................... $ 106,912 $ 391,570
========== ==========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-59
<PAGE> 110

HOME AGAIN, INC.

COMBINED STATEMENTS OF STOCKHOLDER'S EQUITY

<TABLE>
<CAPTION>
TOTAL
COMMON STOCK ADDITIONAL RETAINED STOCKHOLDER'S
--------------- PAID-IN EARNINGS EQUITY
SHARES AMOUNT CAPITAL (DEFICIT) (DEFICIT)
------ ------ ---------- --------- ------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1994..................... 1,000 $ 10 $ 990 $ (46,430) $ (45,430)
Issuance of stock............................ 2,000 20 1,980 -- 2,000
Net income................................... -- -- -- 106,912 106,912
--
----- ----- -------- --------
Balance, December 31, 1995..................... 3,000 30 2,970 60,482 63,482
Distributions to stockholder................. -- -- -- (318,946) (318,946)
Net income................................... -- -- -- 391,570 391,570
--
----- ----- -------- --------
Balance, December 31, 1996..................... 3,000 $ 30 $2,970 $ 133,106 $ 136,106
===== == ===== ======== ========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-60
<PAGE> 111

HOME AGAIN, INC.

COMBINED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
31,
----------------------
1995 1996
-------- ---------
<S> <C> <C>
Cash Flows From Operating Activities:
Net income.......................................................... $106,912 $ 391,570
Adjustments to reconcile net income to net cash provided by
operating activities --
Depreciation and amortization.................................... 23,518 101,045
Change in operating assets and liabilities --
Accounts receivable............................................ (54,407) (40,262)
Security deposits held by landlords............................ (783) (752)
Prepaid expenses............................................... (96,119) (85,847)
Other current assets........................................... (999) 481
Accounts payable............................................... 171,759 109,636
Advanced rent.................................................. 5,132 10,030
Security deposits due customers................................ -- 60,460
Accrued expenses............................................... 19,789 15,563
-------- ---------
Net cash provided by operating activities................... 174,802 561,924
-------- ---------
Cash Flows From Investing Activities:
Purchases of operating stock........................................ (43,159) (200,689)
Purchases of property and equipment................................. (55,918) (134,154)
-------- ---------
Net cash used in investing activities....................... (99,077) (334,843)
-------- ---------
Cash Flows From Financing Activities:
Due to stockholder.................................................. (64,179) 188,592
Proceeds from issuance of stock..................................... 2,000 --
Payments of long-term debt.......................................... -- (4,411)
Proceeds from long-term debt........................................ -- 38,614
Distribution to stockholder......................................... -- (318,946)
-------- ---------
Net cash used in financing activities....................... (62,179) (96,151)
-------- ---------
Net increase in cash and cash equivalents............................. 13,546 130,930
Cash and cash equivalents, beginning of year.......................... 664 14,210
-------- ---------
Cash and cash equivalents, end of year................................ $ 14,210 $ 145,140
======== =========
Supplemental Cash Flow Information:
Cash paid for interest...................................... $ 362 $ 1,202
======== =========
</TABLE>

The accompanying notes are an integral part of these combined financial
statements.

F-61
<PAGE> 112

HOME AGAIN, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

The accompanying combined financial statements include the accounts of Home
Again, Inc. and two affiliated entities in the same business (collectively,
"Home Again" or the "Company"), all of which are S corporations owned by the
same stockholder. The Company was founded in 1994 and provides fully-furnished
apartments, townhouses, condominiums and, to a lesser extent, homes
(collectively, "accommodations") to individuals in need of flexible
accommodations. The Company has offices in Minneapolis, Minnesota; and Oklahoma
City, Oklahoma.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these financial statements.

Use of Estimates

Cash and Cash Equivalents

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Leasehold improvements are capitalized and charged to expense through
depreciation. Upon sale or retirements, the related cost and accumulated
depreciation are removed from the accounts, and any gain or loss is recorded in
the statement of operations. Depreciation is determined using the straight-line
method for financial reporting purposes and accelerated methods for income tax
reporting purposes over the estimated useful lives of the respective assets.
Estimated useful lives are as follows:

<TABLE>
<CAPTION>
ESTIMATED
ASSET CLASSIFICATION USEFUL LIFE
----------------------------------------------------------------- -----------
<S> <C>
Computer equipment............................................... 3-5 years
Office furniture and equipment................................... 5 years
Leasehold improvements........................................... 7 years
Vehicles......................................................... 5 years
</TABLE>

Repairs and maintenance are charged to expense as incurred. General and
administrative costs associated with the opening of new company offices are
expenses as incurred.

Revenue Recognition

The Company recognizes revenues on the sublease of accommodations for its
clients as services are provided.

F-62
<PAGE> 113

HOME AGAIN, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

Concentration of Credit Risk

Concentration of credit risk is limited to accounts receivable. The Company
does not require collateral or other security to support their receivables. The
Company conducts periodic reviews of its clients' financial conditions and
payment practices to minimize collection risks on accounts receivable.

Operating Stock

Operating stock to furnish new apartment units, including linen, glass and
silver, and minor appliances is capitalized as it is purchased and amortized
over a three-year period to a residual value of 50% of the original cost.
Additional purchases of operating stock for apartment units established is
expensed as incurred.

Apartment and Furniture Leases

The Company leases substantially all of its accommodations under lease
terms ranging from one to two years. Furniture for the accommodations is leased
on a monthly basis from various furniture rental companies.

3. INCOME TAXES

The Company, with the consent of its stockholder, elected to be recognized
as an S corporation under the appropriate federal and state tax codes beginning
June 8, 1993. In lieu of corporate income taxes, the stockholders of an S
corporation are taxed on their proportionate shares of the Company's taxable
income. As a result, the recognition of current and deferred income taxes is not
needed in the accompanying combined financial statements.

4. PROPERTY AND EQUIPMENT; OPERATING STOCK

Property and equipment and operating stock consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
1995 1996
------- --------
<S> <C> <C>
Computer equipment.............................................. $18,542 $ 35,171
Furniture and office equipment.................................. 71,405 146,787
Vehicles........................................................ -- 42,143
------- --------
Total property and equipment............................... 89,947 224,101
Less -- accumulated depreciation................................ 21,188 81,593
------- --------
Property and equipment, net........................... $68,759 $142,508
======= ========
Operating stock................................................. $43,159 $243,848
Less -- accumulated amortization................................ 7,193 47,833
------- --------
Operating stock, net.................................. $35,966 $196,015
======= ========
</TABLE>

5. DEBT

Long-term debt consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
1996
------------
<S> <C>
Note payable to a bank, interest rate of 8.75%, due in 48 equal
installments through October 2000, secured by an automobile
purchased with the proceeds from the note........................... $ 18,031
Note payable to a bank, interest rate of 9.5%, due in 48 equal
installments through March 2000; secured by an automobile purchased
with the proceeds from the note..................................... 16,172
--------
34,203
Less -- current maturities............................................ 8,595
--------
Total long-term debt.................................................. $ 25,608
========
</TABLE>

F-63
<PAGE> 114

HOME AGAIN, INC.

NOTES TO COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The following is a schedule of required debt payments as of December 31,
1996:

<TABLE>
<S> <C>
1997....................................................................... $ 8,595
1998....................................................................... 9,641
1999....................................................................... 10,561
2000....................................................................... 5,406
-------
Total............................................................ $34,203
=======
</TABLE>

6. LEASE COMMITMENTS

The Company leases administrative offices, apartment units and furniture at
several locations through 1998. Rent expense for the fiscal years ended December
31, 1995 and 1996 was $989,203 and $2,592,965 respectively. Minimum future
rental payments on long-term leases at December 31, 1996 are as follows:

<TABLE>
<CAPTION>
OPERATING LEASES
----------------
<S> <C>
1997.......................................... $ 59,793
1998.......................................... 57,078
1999.......................................... 53,340
2000.......................................... 51,070
2001.......................................... 50,247
Thereafter.................................... 111,168
--------
Total............................... $382,696
========
</TABLE>

7. DISTRIBUTION TO STOCKHOLDER

The Company declared a distribution to the stockholder during December 1996
in the amount of $191,404, related to 1996 earnings, to be paid in 1997.

8. CONTINGENCIES

9. STOCKHOLDERS' EQUITY

Combined stockholder's equity includes the following common stock accounts
as of December 31, 1995 and 1996 (.01 par value and voting for all classes of
common stock).

<TABLE>
<CAPTION>
OUTSTANDING
SHARES AMOUNT
----------- ------
<S> <C> <C>
Home Again, Inc.
Authorized--1,000,000................................................ 1,000 $ 10
Home Again, Corporate Housing, Inc.
Authorized--100,000.................................................. 1,000 $ 10
Home Again, Amenities, Inc.
Authorized--100,000.................................................. 1,000 $ 10
</TABLE>

10. SALE OF COMPANY

Effective on March 31, 1997, the Company was acquired, through a stock for
stock merger, by Bridgestreet Accomodations, Inc. The stockholder of the Company
received 475,000 shares of Bridgestreet Accomodations, Inc.'s common stock in
exchange for all of the outstanding common stock of the Company.

F-64
<PAGE> 115

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of Temporary Housing Experts, Inc.:

We have audited the accompanying balance sheets of Temporary Housing
Experts, Inc. as of December 31, 1995 and 1996, and the related statements of
operations, stockholders' equity and cash flows for each of the two years in the
period ended December 31, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Temporary Housing Experts,
Inc. as of December 31, 1995 and 1996, and the results of its operations and its
cash flows for each of the two years in the period ended December 31, 1996, in
conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Memphis, Tennessee
March 21, 1997

(except for Note 10, for which
the date is June 30, 1997)

F-65
<PAGE> 116

TEMPORARY HOUSING EXPERTS, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents............................................ $213,845 $ 51,536
Accounts receivable, less allowance for doubtful accounts of $1,311
in 1995 and 1996.................................................. 77,481 99,487
Deferred income taxes................................................ 46,300 70,794
Prepaid expenses..................................................... -- 25,504
Security deposits held by landlord complexes......................... 18,566 24,244
-------- --------
Total current assets.............................................. 356,192 271,565
Operating stock, net of accumulated amortization....................... 141,680 145,086
Property and equipment, net of accumulated depreciation................ 82,265 58,450
-------- --------
Total assets................................................. $580,137 $475,101
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt................................. $ 15,669 $ 18,745
Accounts payable..................................................... 1,257 6,046
Security deposits due to customers................................... 51,087 50,548
Deferred revenue..................................................... 3,363 34,347
Accrued expenses..................................................... 115,750 51,875
Accrued income taxes................................................. 48,287 15,895
-------- --------
Total current liabilities......................................... 235,413 177,456
Long-term debt, net of current maturities.............................. 15,669 11,873
Deferred income taxes.................................................. 56,671 58,033
Stockholders' Equity:
Common stock......................................................... 1,000 1,000
Retained earnings.................................................... 271,384 226,739
-------- --------
Total stockholders' equity........................................ 272,384 227,739
-------- --------
Total liabilities and stockholders' equity................... $580,137 $475,101
======== ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-66
<PAGE> 117

TEMPORARY HOUSING EXPERTS, INC.

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------
1995 1996
---------- ----------
<S> <C> <C>
Revenues............................................................ $3,085,736 $3,582,924
Operating Expenses:
Cost of services.................................................. 2,190,252 2,578,247
Selling, general and administrative expense....................... 865,689 1,077,568
---------- ----------
Total operating expenses....................................... 3,055,941 3,655,815
---------- ----------
Operating income (loss)........................................ 29,795 (72,891)
Other Income (Expense):
Interest expense.................................................. (1,018) (977)
Other income (expense)............................................ (3,649) 6,197
---------- ----------
Other income (expense), net.................................... (4,667) 5,220
---------- ----------
Income (loss) before provision for income taxes..................... 25,128 (67,671)
Benefit for income taxes............................................ (1,923) (23,026)
---------- ----------
Net income (loss)................................................... $ 27,051 $ (44,645)
========== ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-67
<PAGE> 118

TEMPORARY HOUSING EXPERTS, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COMMON STOCK TOTAL
----------------- RETAINED STOCKHOLDERS'
SHARES AMOUNT EARNINGS EQUITY
------ ------ -------- -------------
<S> <C> <C> <C> <C>
Balance, December 31, 1994......................... 1,000 $1,000 $244,333 $ 245,333
Net income....................................... -- -- 27,051 27,051
----- ------ -------- --------
Balance, December 31, 1995......................... 1,000 1,000 271,384 272,384
Net loss......................................... -- -- (44,645) (44,645)
----- ------ -------- --------
Balance, December 31, 1996......................... 1,000 $1,000 $226,739 $ 227,739
===== ====== ======== ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-68
<PAGE> 119

TEMPORARY HOUSING EXPERTS, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------
1995 1996
--------- ---------
<S> <C> <C>
Cash Flows From Operating Activities:
Net (loss) income................................................ $ 27,051 $ (44,645)
Adjustments to reconcile net income (loss) to net cash provided
by (used in) operating activities --
Depreciation and amortization................................. 41,044 59,507
Provision for bad debts....................................... (1,359) --
Gain on sale of property and equipment........................ -- (6,197)
Change in operating assets and liabilities --
Accounts receivable......................................... 740 (26,547)
Prepaid expenses and deposits............................... 1,247 (31,182)
Accounts payable............................................ (12,131) 4,789
Accrued expenses............................................ 102,745 (96,267)
Deferred revenue............................................ (4,615) 30,984
Refundable customer deposits................................ 17,584 (539)
Loans made to employees..................................... (1,676) --
Loan payments from employees................................ -- 4,541
Deferred income taxes....................................... (23,512) (23,132)
-------- ---------
Net cash provided by (used in) operating activities...... 147,118 (128,688)
-------- ---------
Cash Flows from Investing Activities:
Purchases of operating stock..................................... (54,534) (23,250)
Purchases of property and equipment.............................. (83,521) (33,553)
Proceeds from sale of property and equipment..................... -- 23,901
-------- ---------
Net cash used in investing activities.................... (138,055) (32,902)
-------- ---------
Cash Flows from Financing Activities:
Proceeds from notes payable...................................... 31,338 17,100
Payments of notes payable........................................ (14,251) (17,819)
Advances from stockholder........................................ -- 50,000
Repayments to stockholder........................................ -- (50,000)
-------- ---------
Net cash provided by (used in) financing activities...... 17,087 (719)
-------- ---------
Net (decrease) increase in cash and cash equivalents............... 26,150 (162,309)
Cash and cash equivalents, beginning of year....................... 187,695 213,845
-------- ---------
Cash and cash equivalents, end of year............................. $ 213,845 $ 51,536
======== =========
Supplemental Cash Flow Information:
Cash paid for interest................................... $ 979 $ 969
======== =========
Cash paid for income taxes............................... $ 17,800 $ 27,564
======== =========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-69
<PAGE> 120

TEMPORARY HOUSING EXPERTS, INC.

NOTES TO FINANCIAL STATEMENTS

1. BUSINESS AND ORGANIZATION

Temporary Housing Experts, Inc. (the "Company") was founded in 1993, and
provides fully-furnished apartments, townhouses, condominiums and, to a lesser
extent, homes (collectively "accommodations") to individuals in need of flexible
accommodations. The Company has offices in: Memphis, Tennessee; and Jackson,
Mississippi.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed in
the preparation of these financial statements.

Use of Estimates

Cash and Cash Equivalents

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation.
Leasehold improvements are capitalized and charged to expense through
depreciation. Upon sale or retirement, the related cost and accumulated
depreciation are removed from the accounts, and any gain or loss is recorded in
the statement of operations. Depreciation is determined using the straight-line
method for financial reporting purposes and accelerated methods for income tax
reporting purposes over the estimated useful lives of the respective assets.
Estimated useful lives are as follows:

<TABLE>
<CAPTION>
ESTIMATED
ASSET CLASSIFICATION USEFUL LIFE
---------------------------------------------------------------- -----------
<S> <C>
Computer equipment.............................................. 3 Years
Office furniture and equipment.................................. 5 Years
Leasehold improvements.......................................... 7 Years
Vehicles........................................................ 5 Years
</TABLE>

Revenue Recognition

The Company recognizes revenues on the rentals of accommodations to its
clients on a pro rata basis over the length of the client's stay.

Concentration of Credit Risk

F-70
<PAGE> 121

TEMPORARY HOUSING EXPERTS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Operating Stock

Operating stock to furnish new units, including linen, glassware,
silverware and minor appliances is capitalized as it is purchased and amortized
over a three-year period to a residual value of 50% of the original cost.
Additional purchases of operating stock for apartment units already established
is expensed as incurred.

Accommodation and Furniture Leases

3. INCOME TAXES

The provision (benefit) for income taxes consists of the following:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
Current --
State........................................................ $ 5,009 $ 106
Federal...................................................... 16,580 --
--------- ---------
21,589 106
--------- ---------
Deferred --
State........................................................ $ (1,881) $ (2,891)
Federal...................................................... (21,631) (20,241)
--------- ---------
(23,512) (23,132)
--------- ---------
Total benefit for income taxes....................... $ (1,923) $(23,026)
========= =========
</TABLE>

A reconciliation between the benefit for income taxes computed at the
statutory rates and the amount reflected in the accompanying statements of
operations for the two years ended is as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
31,
---------------------
1995 1996
-------- --------
<S> <C> <C>
Computed expected federal tax provision (benefit).............. $ 3,769 $(23,008)
Increase (decrease) in taxes resulting from:
State income taxes, net of federal benefit................... 829 (4,060)
Other........................................................ (6,521) 4,042
--------- ---------
Benefit for income taxes............................. $ (1,923) $(23,026)
========= =========
</TABLE>

F-71
<PAGE> 122

TEMPORARY HOUSING EXPERTS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER
31,
1995 1996
--------- ---------
<S> <C> <C>
Deferred tax assets (liabilities) consist of the following:
Tax assets --
Accruals not yet deductible for tax purposes................. $ 46,300 $ 20,750
Net operating loss carryforward.............................. -- 50,044
--------- ---------
46,300 70,794
Tax liabilities --
Operating stock expensed for tax purposes.................... (56,671) (58,033)
--------- ---------
Net deferred tax asset (liability)................... $(10,371) $ 12,761
--------- ---------
</TABLE>

4. PROPERTY AND EQUIPMENT; OPERATING STOCK

Property and equipment and operating stock consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
1995 1996
--------- --------
<S> <C> <C>
Leasehold improvements.......................................... $ 1,987 $ 1,987
Computer equipment.............................................. 26,298 42,602
Furniture and office equipment.................................. 28,429 23,204
Vehicles........................................................ 80,258 65,296
-------- --------
Total property and equipment.......................... 136,972 133,089
Less -- accumulated depreciation................................ 54,707 74,639
-------- --------
Property and equipment, net........................... $ 82,265 $ 58,450
======== ========
Operating stock................................................. $ 203,244 $226,494
Less -- accumulated amortization................................ 61,564 81,408
-------- --------
Operating stock, net.................................. $ 141,680 $145,086
======== ========
</TABLE>

5. DEBT

Long-term obligations consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------
1995 1996
-------- --------
<S> <C> <C>
Notes payable to financial institutions, interest ranging from 0%
to 7.99% maturing at various dates through March 2001: secured
by certain automobiles purchased with the proceeds from the
notes.......................................................... $ 31,338 $ 30,618
Less -- current maturities....................................... (15,669) (18,745)
--------- ---------
$ 15,669 $ 11,873
========= =========
</TABLE>

6. LEASE COMMITMENTS

The Company leases administrative offices, accommodations and furniture at
several locations through 1998. Rent expense for the fiscal years ended December
31, 1995 and 1996 was $1,890,967 and $2,164,855, respectively. Minimum future
rental payments on long-term leases at December 31, 1996 are as follows:

<TABLE>
<CAPTION>
OPERATING LEASES
----------------
<S> <C>
1997................................................ $709,278
1998................................................ 65,825
--------
Total..................................... $775,103
========
</TABLE>

F-72
<PAGE> 123

TEMPORARY HOUSING EXPERTS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

7. PENSION PLAN

Eligible employees of the Company participate in a profit sharing plan
sponsored by the Company. This defined contribution plan was effective on
January 1, 1995 and provides that the Company will match participant
contributions within specific limitations. The Company's contributions to the
plan amounted to approximately $28,000 in 1995. There was no contribution to the
plan in 1996.

8. CONTINGENCIES

9. SALE OF COMPANY

Effective on January 2, 1997, the Company was acquired, through a stock for
stock merger, by BridgeStreet Accommodations, Inc. The stockholders of the
Company received 391,408 shares of BridgeStreet Accommodations, Inc.'s common
stock in exchange for all of the outstanding common stock of the Company.

10. SUBSEQUENT EVENTS

F-73
<PAGE> 124

============================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY OF THE UNDERWRITERS. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY ANY SECURITY
OTHER THAN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS, NOR DOES IT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY THE SHARES OF
COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
------------------------
TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S> <C>
Prospectus Summary......................... 3
Risk Factors............................... 9
Combination................................ 14
Use of Proceeds............................ 15
Dividend Policy............................ 15
Capitalization............................. 16
Dilution................................... 17
Selected Financial and Other Data.......... 18
Selected Individual Founding Company
Financial and Other Data................. 20
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................... 21
Business................................... 28
Management................................. 37
Principal and Selling Stockholders......... 42
Certain Transactions....................... 43
Description of Capital Stock............... 45
Shares Eligible for Future Sale............ 47
Underwriting............................... 48
Legal Matters.............................. 50
Experts.................................... 50
Additional Information..................... 50
Index to Financial Statements.............. F-1
</TABLE>

------------------------
UNTIL , 1997 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK OFFERED HEREBY, WHETHER OR
NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN
ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR
SUBSCRIPTIONS.
============================================================

============================================================

BRIDGESTREET
ACCOMMODATIONS,
INC.

COMMON STOCK

------------------------
PROSPECTUS
------------------------

LEGG MASON WOOD WALKER
INCORPORATED

------------------------
, 1997

============================================================
<PAGE> 125

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than
underwriting discounts and commissions. All of the amounts shown are estimated
except the Securities and Exchange Commission registration fee.

<TABLE>
<S> <C>
SEC registration fee..................................................... $ 9,113
NASD filing fee.......................................................... 3,536
Blue Sky fees and expenses............................................... 5,000
Nasdaq listing fee....................................................... 35,438
Printing and engraving expenses.......................................... 150,000
Legal fees and expenses.................................................. 750,000
Accounting fees and expenses............................................. 750,000
Transfer agent and registrar fees........................................ 4,000
Premium for directors' and officers' insurance........................... 80,000
Miscellaneous............................................................ 212,913
----------
Total.......................................................... $2,000,000
=========
</TABLE>

ABP will bear all of the foregoing fees and expenses, and the Company will
reimburse ABP for such fees and expenses out of the proceeds of this offering.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company is a Delaware corporation. Reference is made to Section 145 of
the DGCL, as amended, which provides that a corporation may indemnify any person
who was or is a party to or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that he or she is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him or her in connection with such action,
suit or proceeding if he or she acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceedings, had no
reasonable cause to believe his or her conduct was unlawful. Section 145 further
provides that a corporation similarly may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he or she is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees) actually and reasonably incurred by him or
her in connection with the defense or settlement of such action or suit if he or
she acted in good faith and in a manner he or she reasonably believed to be in
or not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Delaware Court of Chancery or the court
in which such action or suit was brought shall determine upon application that,
despite an adjudication of liability, but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper. The
Company's Certificate of Incorporation further provides that the Company shall
indemnify its directors and officers to the full extent permitted by the law of
the State of Delaware.

The Company's Certificate of Incorporation provides that the Company's
directors shall not be liable to the Company or its stockholders for monetary
damages for breach of fiduciary duty as a director, except to the

II-1
<PAGE> 126

extent that exculpation from liability is not permitted under the DGCL as in
effect at the time such liability is determined.

The Certificate of Incorporation also provides that each person who was or
is made a party to, or is involved in, any action, suit, proceeding or claim by
reason of the fact that he or she is or was a director, officer or employee of
the Registrant (or is or was serving at the request of the Registrant as a
director, officer, trustee employee or agent of any other enterprise including
service with respect to employee benefit plans) shall be indemnified and held
harmless by the Registrant, to the full extent permitted by Delaware law, as in
effect from time to time, against all expenses (including attorneys' fees and
expenses), judgments, fines, penalties and amounts to be paid in settlement
incurred by such person in connection with the investigation, preparation to
defend or defense of such action, suit, proceeding or claim.

The rights to indemnification and the payment of expenses provided by the
Certificate of Incorporation do not apply to any action, suit, proceeding or
claim initiated by or on behalf of a person otherwise entitled to the benefit of
such provisions. Any person seeking indemnification under the Certificate of
Incorporation shall be deemed to have met the standard of conduct required for
such indemnification unless the contrary shall be established. Any repeal or
modification of such indemnification provisions shall not adversely affect any
right or protection of a director or officer with respect to any conduct of such
director or officer occurring prior to such repeal or modification.

The Company maintains an indemnification insurance policy covering all
directors and officers of the Company and its subsidiaries.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

In connection with the Combination, in January and March 1997, the Company
issued to the stockholders of the Founding Companies an aggregate of 4,301,000
shares of Common Stock in exchange for all of the issued and outstanding stock
of such companies.

Prior to the Combination, in August 1996, the Company issued to the
promoters of the Company an aggregate of 2,000 shares of Common Stock at a
purchase price of $1.00 per share. In August and November 1996, the Company
issued 150 and 350 shares of restricted Common Stock, respectively, at a
purchase price of $1.00 per share, to two individuals upon their agreement to
become executive officers of the Company in January 1997. The restrictions since
have lapsed. In November 1996, the Company issued 66 shares of Common Stock to a
consultant at a purchase price of $1.00 per share. A 499-for-1 stock dividend
(the "Stock Dividend") was declared by the Company with respect to all shares of
Common Stock that were outstanding as of November 28, 1996.

All such issuances of Common Stock (other than the Stock Dividend) have
been made in reliance upon the exemption from registration afforded by Section
4(2) under the Securities Act.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS

(A) EXHIBITS. Unless otherwise indicated, the following exhibits will be
filed by amendment to this Registration Statement.

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------ ------------------------------------------------------------------------- ----------
<C> <S> <C>
1 Form of Underwriting Agreement...........................................
*3.1 Certificate of Incorporation of the Company..............................
+3.2 By-laws of the Company...................................................
4.1 Specimen Stock Certificate...............................................
5 Opinion of Nutter, McClennen & Fish, LLP.................................
*10.1 Agreement and Plan of Merger dated as of December 30, 1996 by and among
BridgeStreet International Inc., EIP Acquisition Corp., Exclusive Interim
Properties, Ltd. and Melanie R. Sabelhaus................................
</TABLE>

II-2
<PAGE> 127

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------ ------------------------------------------------------------------------- ----------
<C> <S> <C>
*10.2 Agreement and Plan of Merger dated as of December 30, 1996 by and among
BridgeStreet International Inc., THEI Acquisition Corp., Temporary
Housing Experts, Inc., Connie F. O'Briant and Thomas W. O'Briant.........
*10.3 Agreement and Plan of Merger dated as of December 30, 1996 by and among
BridgeStreet International Inc., TCHI Acquisition Corp., Temporary
Corporate Housing Columbus, Inc., Temporary Corporate Housing Cleveland,
Inc., Temporary Corporate Housing Cincinnati, Inc., Temporary Corporate
Housing Pittsburgh, Inc., SLD Partnership, Lynda Clutchey, David Clutchey
III, Beth Holzer and David Holzer........................................
*10.4 Agreement and Plan of Merger dated as of December 30, 1996 by and among
BridgeStreet International Inc., CL Acquisition Corp., Corporate
Lodgings, Inc., Corporate Lodgings of Kentucky, Inc., Corporate Lodgings
of Minnesota, Inc., Corporate Lodgings of Pennsylvania, Inc., Corporate
Lodgings of Wisconsin, Inc. and Rocco A. Di Lillo........................
*10.5 Agreement and Plan of Merger dated as of March 31, 1997 by and among
BridgeStreet International Inc., HAI Acquisition Corp., Home Again, Inc.,
Home Again Amenities, Inc., Home Again Corporate Housing, Inc. and Sandra
A. Brown.................................................................
+10.6 1997 Equity Incentive Plan...............................................
+10.7 Stock Plan for Non-Employee Directors....................................
*10.8 Employment Agreement dated December 30, 1996, between CL Acquisition
Corp. and Rocco A. Di Lillo..............................................
*10.9 Employment Agreement dated December 30, 1996, between EIP Acquisition
Corp. and Melanie R. Sabelhaus...........................................
*10.10 Employment Agreement dated December 30, 1996 between THEI Acquisition
Corp. and Connie F. O'Briant.............................................
*10.11 Employment Agreement dated December 30, 1996, between TCHI Acquisition
Corp. and Lynda Clutchey.................................................
+10.12 Employment Agreement dated as of January 2, 1997, between BridgeStreet
International Inc. and Mark D. Gagne.....................................
+10.13 Employment Agreement dated as of March 31, 1997, between BridgeStreet
International Inc. and William N. Hulett, III............................
*10.14 Revolving Credit Agreement. Dated as of March 31, 1997 between
BridgeStreet International Inc., as Borrower, and Fleet National Bank and
the Other Lending Institutions listed on Schedule 1 thereto and Fleet
National Bank as Agent...................................................
*10.15 Revolving Credit Note for the principal balance of $10,000,000, dated
March 31, 1997...........................................................
+10.16 Rental Agreement between Saturn Enterprises Inc. and Temporary Corporate
Housing Inc. dated December 28, 1995.....................................
+10.17 Exclusive Lease Agreement between Integrity Furniture, Inc. and Temporary
Corporate Housing Pittsburgh, Inc. dated September 12, 1995..............
*21 Subsidiaries of the Registrant...........................................
+23.1 Consent of Arthur Andersen, LLP..........................................
+23.2 Consent of Arthur Andersen, LLP..........................................
23.3 Consent of Nutter, McClennen & Fish, LLP (contained in Exhibit 5)........
*24 Power of Attorney (contained in the signature page to this Registration
Statement)...............................................................
+27 Financial Data Schedule..................................................
+99.1 Consent of James M. Biggar...............................................
+99.2 Consent of Robert R. Mesel...............................................
</TABLE>

II-3
<PAGE> 128

- ---------------

* Previously filed.
+ Filed herewith.

(B) FINANCIAL STATEMENT SCHEDULES

The following Financial Statement Schedule is filed herewith as part of
this Registration Statement:

Schedule II -- Valuation and Qualifying Accounts

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A under the
Securities Act and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities
Act shall be deemed to be part of this Registration Statement as of the
time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

II-4
<PAGE> 129

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Boston, the
Commonwealth of Massachusetts, on the 11th day of July 1997.

BRIDGESTREET ACCOMMODATIONS, INC.

By: /s/ MARK D. GAGNE
------------------------------------
Mark D. Gagne
Chief Financial Officer and
Principal Accounting Officer

POWER OF ATTORNEY

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- -------------------------------- ---------------
<C> <S> <C>
/s/ WILLIAM N. HULETT, III* President, Chief Executive July 11, 1997
- --------------------------------------------- Officer and Director
William N. Hulett, III
/s/ MARK D. GAGNE Chief Financial Officer and July 11, 1997
- --------------------------------------------- Principal Accounting Officer
Mark D. Gagne

/s/ PAUL M. VERROCHI* Chairman of the Board July 11, 1997
- ---------------------------------------------
Paul M. Verrochi

/s/ ROCCO A. DI LILLO* Vice President, Chief Operating July 11, 1997
- --------------------------------------------- Officer and Director
Rocco A. Di Lillo

/s/ LYNDA D. CLUTCHEY* Director July 11, 1997
- ---------------------------------------------
Lynda D. Clutchey

/s/ CONNIE F. O'BRIANT* Director July 11, 1997
- ---------------------------------------------
Connie F. O'Briant

/s/ MELANIE R. SABELHAUS* Director July 11, 1997
- ---------------------------------------------
Melanie R. Sabelhaus
</TABLE>

*By: /s/ MARK D. GAGNE
-------------------------------
Mark D. Gagne
Attorney-in-Fact

Powers of Attorney have been filed with this Registration Statement

II-5
<PAGE> 130

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders and Board of Directors of BridgeStreet Accommodations, Inc.

We have audited, in accordance with generally accepted auditing standards,
the combined financial statements of Temporary Corporate Housing Columbus, Inc.
included in BridgeStreet Accommodations, Inc.'s Form S-1 and have issued our
report thereon dated February 28, 1997. Our audit was made for the purpose of
forming an opinion on those statements taken as a whole. Temporary Corporate
Housing Columbus, Inc.'s Schedule of Valuation and Qualifying Accounts, included
in Schedule II on page S-2, is the responsibility of the Company's management
and is presented for purposes of complying with the Securities and Exchange
Commission's rules and is not part of the basic combined financial statements.
This schedule has been subjected to the auditing procedures applied in the
audits of the basic combined financial statements and, in our opinion, fairly
states in all material respects the combined financial data required to be set
forth therein in relation to the basic combined financial statements taken as a
whole.

Arthur Andersen LLP

Boston, Massachusetts
February 28, 1997

S-1
<PAGE> 131

SCHEDULE II

TEMPORARY CORPORATE HOUSING COLUMBUS, INC.

VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
PROVISION
BALANCE AT CHARGED ACCOUNTS BALANCE
BEGINNING TO ACCOUNTS WRITTEN AT END
OF YEAR EXPENSE RECOVERED OFF OF YEAR
---------- --------- --------- -------- -------
<S> <C> <C> <C> <C> <C>
Year Ended December 31, 1996
Allowance for Doubtful Accounts....... $ -- $ 45,000 $ -- $ -- $45,000

Year Ended December 31, 1995
Allowance for Doubtful Accounts....... $ -- $ -- $ -- $ -- $ --
Year Ended December 31, 1994
Allowance for Doubtful Accounts....... $ -- $ -- $ -- $ -- $ --
</TABLE>

S-2
<PAGE> 132

EXHIBIT INDEX

<PAGE> 133

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------ ------------------------------------------------------------------------- ----------
<C> <S> <C>
*21 Subsidiaries of the Registrant...........................................
+23.1 Consent of Arthur Andersen, LLP..........................................
+23.2 Consent of Arthur Andersen, LLP..........................................
23.3 Consent of Nutter, McClennen & Fish, LLP (contained in Exhibit 5)........
*24 Power of Attorney (contained in the signature page to this Registration
Statement)...............................................................
+27 Financial Data Schedule..................................................
+99.1 Consent of James M. Biggar...............................................
+99.2 Consent of Robert R. Mesel...............................................
+99.3 Consent of Jerry Sue Thornton............................................
</TABLE>

- ---------------
* Previously filed.

+ Filed herewith.

<PAGE> 1
Exhibit 3.2

BY-LAWS OF

BRIDGESTREET ACCOMMODATIONS, INC.

ARTICLE I

OFFICES

The registered office shall be in the City of Wilmington, County of New
Castle, State of Delaware, and the name of the resident agent in charge thereof
is the Corporation Service Company.

The corporation may also have offices at such other places within or
without the State of Delaware as the Board of Directors may from time to time
appoint or the business of the corporation may require.

ARTICLE II

MEETINGS OF STOCKHOLDERS

SECTION L. PLACE OF MEETINGS. All meetings of stockholders for any purpose
shall be held at such place, within or without the State of Delaware, as shall
be designated by the Board of Directors and stated in the notice of the meeting.

SECTION 2. ANNUAL MEETING. An annual meeting of the stockholders of the
corporation, for the election of Directors to succeed those whose terms expire
and for the transaction of such other business as may properly come before the
meeting, shall be held on such date and at such time as shall be fixed from time
to time by the Board of Directors and stated in the notice of the meeting.

SECTION 3. SPECIAL MEETINGS. Special meetings of the stockholders may be
called by the Chairman of the Board, if any, the President or by order of the
Board of Directors. Business transacted at any special meeting shall be confined
to the purpose or purposes stated in the notice of such meeting.

SECTION 4. NOTICE OF MEETING. Notice of the time and place of holding each
annual meeting and each special meeting of stockholders shall be given by the
Secretary, not less than ten nor more than sixty days before the meeting, to
each stockholder of record entitled to vote at such meeting. Notices of all
meetings of stockholders shall state the purposes for which the meetings are
held.

<PAGE> 2

SECTION 5. LIST OF STOCKHOLDERS. At least ten days before every meeting of
stockholders a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder,
shall be prepared by the Secretary, who shall have charge of the stock ledger.
Such list shall be open for said ten days to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, either
at a place specified in the notice of the meeting (which place shall be within
the city where the meeting is to be held) or, if no such other place has been so
specified, at the place where the meeting is to be held. Such list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder present at the meeting.

SECTION 6. QUORUM. At any meeting of stockholders, the holders of issued
and outstanding shares of capital stock which represent a majority of the votes
entitled to be cast thereat, present in person or represented by proxy, shall
constitute a quorum for the transaction of business. If, however, such quorum
shall not be present or represented at any meeting of the stockholders, the
stockholders entitled to vote thereat, present in person or represented by
proxy, shall have the power to adjourn the meeting from time to time until a
quorum shall be present or represented. Unless the adjournment is for more than
thirty days or a new record date is fixed for the adjourned meeting, notice of
the adjourned meeting need not be given if the time and place thereof are
announced at the meeting at which the adjournment is taken. At such adjourned
meeting at which a quorum shall be present or represented any business may be
transacted which might have been transacted at the meeting as originally called.

SECTION 7. VOTING. At any meeting of the stockholders, every stockholder
having the right to vote shall be entitled to vote in person, or by proxy
appointed by an instrument in writing subscribed by such stockholder and bearing
a date not more than eleven months prior to said meeting. When a quorum is
present at any meeting, a plurality of the votes properly cast for election to
the Board of Directors shall elect to the Board of Directors and a majority of
the votes properly cast on any question other than election to the Board of
Directors shall decide the question unless the question is one upon which by
express provision of law or of the certificate of incorporation or of these
By-laws a different vote is required, in which case such express provision shall
govern and control the decision of such question.

SECTION 8. FIXING OF RECORD DATE. (a) In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action other than stockholder action by
written consent, the Board of

-2-

<PAGE> 3

Directors may fix a record date, which shall not precede the date such record
date is fixed and shall not be more than sixty nor less than ten days before the
date of such meeting, nor more than sixty days prior to any such other action.
If no record date is fixed, the record date for determining stockholders
entitled to notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given.
The record date for any other purpose other than stockholder action by written
consent shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto. A determination of
stockholders of record entitled to notice of or to vote at a meeting of
stockholders shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the adjourned meeting.

(b) In order that the corporation may determine the stockholders entitled
to consent to corporate action in writing without a meeting, the Board of
Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which date shall not be more than 10 days after the date upon
which the resolution fixing the record date is adopted by the Board of
Directors.

SECTION 9. NOMINATION OF DIRECTORS. Only persons who are nominated in
accordance with the procedures set forth in the By-laws shall be eligible to
serve as Directors. Nominations of persons for election to the Board of
Directors of the corporation may be made at a meeting of stockholders (a) by or
at the direction of the Board of Directors or (b) by any stockholder of the
corporation who is a stockholder of record at the time of giving of notice
provided for in this Section 9, who shall be entitled to vote for the election
of directors at the meeting and who complies with the notice procedures set
forth in this Section 9. Such nominations, other than those made by or at the
direction of the Board of Directors, shall be made pursuant to timely notice in
writing to the Secretary of the corporation. To be timely, a stockholder's
notice shall be delivered to or mailed and received at the principal executive
offices of the corporation not less than 60 days nor more than 90 days prior to
the meeting; provided, however, that in the event that less than 70 days' notice
or prior public disclosure of the date of the meeting is given or made to
stockholders, notice by the stockholder to be timely must be so received not
later than the close of business on the 10th day following the day on which such
notice of the date of the meeting or such public disclosure was made. Such
stockholder's notice shall set forth (a) as to each person whom the stockholder
proposes to nominate for election or reelection as a Director all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of Directors, or is otherwise required, in each case
pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended
(including such person's written consent to being named in the proxy statement
as a nominee and to serving as a Director if elected); and (b) as to the
stockholder giving the notice (i) the name and address, as they appear on the
corporation's books, of such stockholder and (ii) the class and number of shares
of the

-3-

<PAGE> 4

corporation which are beneficially owned by such stockholder. At the request of
the Board of Directors, any person nominated by the Board of Directors for
election as a Director shall furnish to the Secretary of the corporation that
information required to be set forth in a stockholder's notice of nomination
which pertains to the nominee. No person shall be eligible to serve as a
Director of the corporation unless nominated in accordance with the procedures
set forth in this By-law. The Chairman of the meeting shall, if the facts
warrant, determine and declare to the meeting that a nomination was not made in
accordance with the procedures prescribed by the By-laws, and if he or she
should so determine, he or she shall so declare to the meeting and the defective
nomination shall be disregarded. Notwithstanding the foregoing provisions of
this Section 9, a stockholder shall also comply with all applicable requirements
of the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder with respect to the matters set forth in this Section.

SECTION 10. NOTICE OF BUSINESS. At any meeting of the stockholders, only
such business shall be conducted as shall have been brought before the meeting
(a) by or at the direction of the Board of Directors or (b) by any stockholder
of the corporation who is a stockholder of record at the time of giving of the
notice provided for in this Section 10, who shall be entitled to vote at such
meeting and who complies with the notice procedures set forth in this Section
10. For business to be properly brought before a stockholder meeting by a
stockholder, the stockholder must have given timely notice thereof in writing to
the Secretary of the corporation. To be timely, a stockholder's notice must be
delivered to or mailed and received at the principal executive offices of the
corporation not less than 60 days nor more than 90 days prior to the meeting;
provided, however, that in the event that less than 70 days' notice or prior
public disclosure of the date of the meeting is given or made to stockholders,
notice by the stockholder to be timely must be received no later than the close
of business on the 10th day following the day on which such notice of the date
of the meeting was mailed or such public disclosure was made. A stockholder's
notice to the Secretary shall set forth as to each matter the stockholder
proposes to bring before the meeting (a) a brief description of the business
desired to be brought before the meeting and the reasons for conducting such
business at the meeting, (b) the name and address, as they appear on the
Corporation's books, of the stockholder proposing such business, (c) the class
and number of shares of the corporation which are beneficially owned by the
stockholder and (d) any material interest in the stockholder in such business.
Notwithstanding anything in the By-laws to the contrary, no business shall be
conducted at a stockholder meeting except in accordance with the procedures set
forth in this Section 10. The Chairman of the meeting shall, if the facts
warrant, determine and declare to the meeting that business was not properly
brought before the meeting and in accordance with the provisions of the By-laws,
and if he or she should so determine, he or she shall so declare to the meeting
and any such business not properly brought before the meeting shall not be
transacted.

-4-

<PAGE> 5

Notwithstanding the foregoing provisions of this Section 10, a stockholder shall
also comply with all applicable requirements of the Securities Exchange Act of
1934, as amended, and the rules and regulations thereunder with respect to the
matters set forth in this Section.

ARTICLE III

DIRECTORS

SECTION 1. NUMBER. The corporation shall have one or more Directors, the
number of Directors to be determined from time to time by vote of a majority of
the Directors then in office. Except in connection with the election of
Directors at the annual meeting of stockholders, the number of Directors may be
decreased only to eliminate vacancies by reason of death, resignation or removal
of one or more Directors. No Director need by a stockholder.

SECTION 2. POWERS OF DIRECTORS. The affairs, property and business of the
corporation shall be managed by the Board of Directors which may exercise all
such powers of the corporation and do all such lawful acts and things as are not
by law or by the certificate of incorporation or these By-laws directed or
required to be exercised or done by the stockholders.

SECTION 3. VACANCIES. Vacancies and any newly created Directorships
resulting from any increase in the number of Directors may be filled by vote of
the holders of the particular class or series of stock entitled to elect such
Director at a meeting called for the purpose, or by a majority of the Directors
then in office, although less than a quorum, or by a sole Director, in each case
elected by the particular class or series of stock entitled to elect such
Directors. When one or more Directors shall resign from the Board, effective at
a future date, a majority of the Directors then in office, including those who
have resigned, who were elected by the particular class or series of stock
entitled to elect such resigning Director or Directors shall have the power to
fill such vacancy or vacancies, the vote or action by writing thereon to take
effect when such resignation or resignations shall become effective. The
Directors shall have and may exercise all their powers notwithstanding the
existence of one or more vacancies in their number, subject to any requirements
of law or of the certificate of incorporation or of these By-Laws as to the
number of Directors required for a quorum or for any vote or other action.

SECTION 4. ANNUAL MEETING OF DIRECTORS. The first meeting of each newly
elected Board of Directors may be held without notice immediately after an
annual meeting of stockholders (or a special meeting of stockholders held in
lieu of an annual meeting) at the same place as that at which such meeting of
stockholders was held; or such first meeting may be held at such place (within
or without the State of

-5-

<PAGE> 6

Delaware) and time as shall be fixed by the consent in writing of all the
Directors, or may be called in the manner hereinafter provided with respect to
the call of special meetings.

SECTION 5. REGULAR MEETINGS OF DIRECTORS. Regular meetings of the Board of
Directors may be held at such times and at such place or places (within or
without the State of Delaware) as the Board of Directors may from time to time
prescribe. No notice need be given of any regular meeting and a notice, if
given, need not specify the purposes thereof.

SECTION 6. SPECIAL MEETINGS OF DIRECTORS. Special meetings of the Board of
Directors may be called at any time by or under the authority of the Chairman of
the Board, if any, or the President and shall be called by him or her or by the
Secretary on written request of any two Directors or, if the Secretary fails to
do so, by two Directors in the name of the Secretary, to be held in each
instance at such place (within or without the State of Delaware) as the person
calling the meeting may designate in the call thereof. Notice of each special
meeting of the Board of Directors, stating the time and place thereof, shall be
given to each Director by the Secretary not less than twenty-four hours before
the meeting. Such notice need not specify the purposes of the meeting.

SECTION 7. QUORUM; VOTING. At any meeting of the Board of Directors a
majority of the Directors then in office shall constitute a quorum for the
transaction of business, but if a quorum shall not be present at any meeting of
Directors, the Directors present thereat may adjourn the meeting from time to
time without notice other than announcement at the meeting, until a quorum shall
be present. Except as otherwise provided by law or by the certificate of
incorporation or by the By-laws, the affirmative vote of at least a majority of
the Directors present at a meeting at which there is a quorum shall be the act
of the Board of Directors.

SECTION 8. MEETINGS BY TELEPHONE. Members of the Board of Directors or of
any committee thereof may participate in meetings of the Board of Directors or
of such committee by means of conference telephone or similar communications
equipment by means of which all person participating in the meeting can hear
each other, and such participation shall constitute presence in person at such
meeting.

SECTION 9. ACTION WITHOUT MEETING. Unless otherwise restricted by the
certificate of incorporation, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting if all members of the Board of Directors or of such committee,
as the case may be, consent thereto in writing and the writing or writings are
filed with the minutes of proceedings of the Board of Directors or of such
committee.

-6-

<PAGE> 7

SECTION 10. COMPENSATION. By resolution of the Board of Directors, the
Directors, as such, may receive stated salaries for their services, and may be
allowed a fixed sum and expenses of attendance, if any, for attendance at each
regular or special meeting of the Board. Members of committees may also be
allowed a fixed sum and expenses of attendance, if any, for attending committee
meetings. Nothing herein contained shall preclude any Director from serving the
corporation in any other capacity and receiving compensation for such services.

ARTICLE IV

EXECUTIVE AND OTHER COMMITTEES

The Board of Directors may, by vote of a majority of the whole Board (a)
designate, change the membership of or terminate the existence of any committee
or committees, each committee to consist of one or more of the Directors; (b)
designate one or more Directors as alternate members of any such committee who
may replace any absent or disqualified member at any meeting of the committee;
and (c) determine the extent to which each such committee shall have and may
exercise the powers of the Board of Directors in the management of the business
and affairs of the corporation, including the power to authorize the seal of the
corporation to be affixed to all papers which require it and the power and
authority to declare dividends or to authorize the issuance of stock; excepting,
however, such powers which by law, by the certificate of incorporation or by
these By-Laws they are prohibited from so delegating. In the absence or
disqualification of any member of such committee and his alternative, if any,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not constituting a quorum, may unanimously appoint another
member of the Board of Directors to act at the meeting in the place of any such
absent or disqualified member. Except as the Board of Directors may otherwise
determine, any committee may make rules for the conduct of its business, but
unless otherwise provided by the Board or such rules, its business shall be
conducted as nearly as may be in the same manner as is provided by these By-Laws
for the conduct of business by the Board of Directors. Each committee shall keep
regular minutes of its meetings and report the same to the Board of Directors
upon request.

ARTICLE V

OFFICERS

SECTION 1. OFFICERS AND THEIR ELECTION, TERM OF OFFICE AND VACANCIES. The
officers of the corporation shall be a President, a Secretary, a Treasurer and
such Executive Vice Presidents, Vice Presidents, Assistant Secretaries,
Assistant Treasurers and other officers as the Board of Directors may from time
to time determine and

-7-

<PAGE> 8

elect or appoint. All officers shall be elected annually by the Board of
Directors at their first meeting following the annual meeting of stockholders or
any special meeting held in lieu thereof and shall hold office until their
successors are duly elected and qualified. The Chairman of the Board, if there
is one, must be a Director. Any other officer may, but need not be, a member of
the Board of Directors. Two or more offices may be held by the same person. Any
officer elected by the Board of Directors may be removed at any time by the
Board of Directors. If any vacancy shall occur among the officers, it shall be
filled by the Board of Directors.

SECTION 2. CHAIRMAN OF THE BOARD OF DIRECTORS AND PRESIDENT. The Chairman
of the Board, if any, shall have such duties and powers as shall be designated
from time to time by the Board of Directors. Unless the Board of Directors
otherwise specifies, the Chairman of the Board, or if there is none the chief
executive officer, shall preside, or designate the person who shall preside, at
all meetings of the stockholders and of the Board of Directors.

Unless the Board of Directors otherwise specifies, the President shall be
the chief executive officer and shall have direct charge of all business
operations of the corporation and, subject to the control of the Directors,
shall have general charge and supervision of the business of the corporation.

SECTION 3. VICE PRESIDENTS. In the absence or disability of the President,
his or her powers and duties shall be performed by the Executive Vice President,
if only one, or, if more than one, by the one designated for the purpose by the
Board. Each Vice President shall have such other powers and perform such other
duties as the Board shall from time to time designate.

SECTION 4. TREASURER. The Treasurer shall keep full and accurate accounts
of receipts and disbursements in books belonging to the corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the corporation in such depositaries as shall be designated by the Board or in
the absence of such designation in such depositaries as he or she shall from
time to time deem proper. He or she shall disburse the funds of the corporation
as shall be ordered by the Board, taking proper vouchers for such disbursements.
He or she shall promptly render to the President and to the Board such
statements of his or her transactions and accounts as the President and Board
respectively may from time to time require. The Treasurer shall perform such
duties and have such powers additional to the foregoing as the Board may
designate.

SECTION 5. ASSISTANT TREASURERS. In the absence or disability of the
Treasurer, his or her powers and duties shall be performed by the Assistant
Treasurer, if only one, or if more than one, by the one designated for the
purpose by the Board. Each Assistant Treasurer shall have such other powers and
perform such other duties as the Board shall from time to time designate.

-8-

<PAGE> 9

SECTION 6. THE SECRETARY. The Secretary shall issue notices of all
meetings of stockholders and Directors and of the executive and other committees
where notices of such meetings are required by law or these By-laws. He or she
shall keep the minutes of meetings of stockholders and of the Board of Directors
and of the executive and other committees, respectively, unless such committees
appoint their own respective secretaries and be responsible for the custody
thereof. Unless the Board shall appoint a transfer agent and/or registrar, the
Secretary shall be charged with the duty of keeping, or causing to be kept,
accurate records of all stock outstanding, stock certificates issued and stock
transfers. He or she shall sign such instruments as require his or her signature
and shall perform such other duties and shall have such powers as the Board of
Directors shall designate from time to time, in all cases subject to the control
of the Board of Directors. The Secretary shall have custody of the corporate
seal, shall affix and attest such seal on all documents whose execution under
seal is duly authorized. In his or her absence at any meeting, an Assistant
Secretary or the Secretary pro tempore shall perform his or her duties thereat.

SECTION 7. ASSISTANT SECRETARIES. In the absence or disability of the
Secretary, his or her powers and duties shall be performed by the Assistant
Secretary, if only one, or, if more than one, by the one designated for the
purpose by the Board. Each Assistant Secretary shall have such powers and
perform such other duties as the Board shall from time to time designate.

SECTION 8. SALARIES. The salaries of officers, agents and employees shall
be fixed from time to time by or under authority from the Board of Directors.

ARTICLE VI

RESIGNATIONS AND REMOVALS

SECTION 1. OFFICERS, AGENTS, EMPLOYEES AND MEMBERS OF COMMITTEES. Any
officer, agent or employee of the corporation may resign at any time by giving
written notice to the Board of Directors or to the Chairman of the Board, if
any, the President or the Secretary of the corporation; and any member of any
committee may resign by giving written notice either as aforesaid or to the
committee of which he or she is a member or to the chairman thereof. Any such
resignation shall take effect at the time specified therein, or if the time be
not specified, upon receipt thereof, and, unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it effective.
The Board of Directors may at any time, with or without cause, remove from
office or discharge or terminate the employment of any officer, agent, employee
or member of any committee.

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<PAGE> 10

SECTION 2. DIRECTORS. Any Director of the corporation may resign at any
time by giving written notice to the Board of Directors or to the Chairman of
the Board, if any, the President or the Secretary of the corporation. Any such
resignation shall take effect at the time specified therein, or if the time be
not specified, upon receipt thereof; and unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective. When
one or more Directors shall resign from the Board of Directors, effective at a
future date, a majority of the Directors then in office, including those who
have so resigned, shall have power to fill such vacancy or vacancies, the vote
thereon to take effect when such resignation or resignations shall become
effective, and each Director so chosen shall hold office as provided in these
By-laws in the filling of other vacancies. The stockholders of the corporation
entitled to vote upon the election of Directors may, at any time, remove from
office any one or more Directors only with cause, and his or her successor or
their successors shall be elected by the remaining Directors as provided in
these By-laws with respect to the filling of other vacancies. A Director may be
removed for cause only after reasonable notice and opportunity to be heard
before the body proposing to remove him or her.

ARTICLE VII

INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS

SECTION 1. The corporation shall indemnify, to the fullest extent
permitted by the General Corporation Law of the State of Delaware as presently
in effect or as hereafter amended:

(a) Any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative and whether
external or internal to the corporation (other than by action by or in the
right of the corporation) by reason of the fact that he or she is or was a
Director or officer of the corporation, or is or was serving at the
request of the corporation as a Director or officer of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him or her in
connection with such suit, action or proceeding if he or she acted in good
faith and in a manner which he or she reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe that his
or her conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
NOLO CONTENDERE or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner
which he or she reasonably believed to

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<PAGE> 11

be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, that the person had no
reasonable cause to believe that his or her conduct was lawful.

(b) Any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by reason of
the fact that he or she is or was a Director or officer of the
corporation, or is or was serving at the request of the corporation as a
Director or officer of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys' fees)
and amounts paid in settlement actually and reasonably incurred by him or
her in connection with the defense or settlement of such action or suit if
he or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the corporation
and except that no indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery of the State of Delaware or the court in which such action or
suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem
proper.

SECTION 2. The Board of Directors, in its discretion, may authorize the
corporation to indemnify to the fullest extent permitted by the General
Corporation Law of the State of Delaware (as presently in effect or as hereafter
amended):

(a) Any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an
action by or in the right of the corporation) by reason of the fact that
he or she is or was an employee or agent of the corporation, or is or was
serving at the request of the corporation as an employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him or
her in connection with such suit, action or proceeding if he or she acted
in good faith and in a manner he or she reasonably believed to be in or
not opposed to the best interest of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
or her conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not

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<PAGE> 12

act in good faith and in a manner which he or she reasonably believed to
be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, that the person had no
reasonable cause to believe that his or her conduct was lawful.

(b) Any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by reason of
the fact that he or she is or was an employee or agent of the corporation,
or is or was serving at the request of the corporation as an employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees) and amounts paid
in settlement actually and reasonably incurred by him or her in connection
with the defense or settlement of such action or suit if he or she acted
in good faith and in a manner he or she reasonably believed to be in or
not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of Chancery of
the State of Delaware or the court in which such action or suit was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.

SECTION 3. Any indemnification under this Article VII (unless required by
law or ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the Director,
officer, employee or agent is proper in the circumstances because he or she has
met the applicable standard of conduct set forth in Sections l and 2 of this
Article VII. Such determination shall be made (i) by a majority vote of the
Directors who are not parties to such action, suit or proceeding, even though
less than a quorum, or (ii) if there are no such Directors, or if such Directors
so direct, by independent legal counsel in a written opinion, or (iii) by the
stockholders of the corporation.

SECTION 4. Expenses incurred by a Director or officer in defending a civil
or criminal action, suit or proceeding shall be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of the Director or officer to repay such
amount if it shall ultimately be determined that he or she is not entitled to be
indemnified by the corporation as authorized in this Article VII. Any advance
under this Section 4 shall be made promptly, and in any event within ninety
days, upon the written request of the person seeking the advance.

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<PAGE> 13

SECTION 5. The indemnification and advancement of expenses provided by, or
granted pursuant to, the other Sections of this Article VII shall not be deemed
exclusive of any other rights to which any person, whether or not entitled to be
indemnified under this Article VII, may be entitled under any statute, by-law,
agreement, vote of stockholders or disinterested Directors or otherwise, both as
to action in his or her official capacity and as to action in another capacity
while holding such office. Each person who is or becomes a Director or officer
as described in Section 1 shall be deemed to have served or to have continued to
serve in such capacity in reliance upon the indemnity provided for in this
Article VII. All rights to indemnification under this Article VII shall be
deemed to be provided by a contract between the corporation and the person who
serves as a Director or officer of the corporation at any time while these
By-laws and other relevant provisions of the General Corporation Law of the
State of Delaware and other applicable law, if any, are in effect. Any repeal or
modification thereof shall not affect any rights or obligations then existing.

SECTION 6. The Board of Directors may at any time and from time to time
cause the corporation to purchase and maintain insurance on behalf of any person
who is or was a Director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a Director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against any liability asserted against him or her and incurred
by him or her in any such capacity, or arising out of his or her status as such,
whether or not the corporation would have the power to indemnify him or her
against such liability under the provisions of the General Corporation Law of
the State of Delaware (as presently in effect or hereafter amended), the
Certificate of Incorporation of the corporation or these By-laws.

SECTION 7. The corporation's indemnification under Sections 1 and 2 of
this Article VII of any person who is or was a Director, officer, employee or
agent of the corporation, or is or was serving, at the request of the
corporation as a Director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall be reduced by any
amounts such person receives as indemnification (i) under any policy of
insurance purchased and maintained on his or her behalf by the corporation, (ii)
from such other corporation, partnership, joint venture, trust or other
enterprise, or (iii) under any other applicable indemnification provision.

SECTION 8. In the discretion of the Board of Directors of the corporation,
for the purposes of this Article VII, references to "the corporation" may also
include any constituent corporation (including any constituent of a constituent)
absorbed in a consolidation or merger which, if its separate existence had
continued, would have had power and authority to indemnify its Directors or
officers, so that any person who is or was a Director or officer of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a Director or officer of

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<PAGE> 14

another corporation, partnership, joint venture, trust or other enterprise,
would stand in the same position under the provisions of this Article VII with
respect to the resulting or surviving corporation as he or she would have with
respect to such other constituent corporation if its separate existence had
continued.

SECTION 9. In addition to and without limiting the foregoing provisions of
this Article VII and except to the extent otherwise required by law, any person
seeking indemnification under or pursuant to Section 1 of this Article VII shall
be deemed and presumed to have met the applicable standard of conduct set forth
in Section l unless the contrary shall be established.

SECTION 10. For purposes of this Article VII, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the corporation"
shall include any service by a Director or officer of the corporation which
imposes duties on, or involves services by, such person with respect to any
employee benefit plan, its participants, or beneficiaries; and a person who
acted in good faith and in a manner he or she reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit plan shall
be deemed to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this Article VII.

SECTION 11. To the extent that a Director, officer, agent or employee of
the corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in Section 1 or in Section 2, or in
defense of any claim, issue or matter therein, he or she shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by
him or her in connection therewith.

SECTION 12. The indemnification and advancement of expenses provided by,
or granted pursuant to, this Article VII shall continue as to a person who has
ceased to be a Director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.

ARTICLE VIII

CAPITAL STOCK

SECTION 1. STOCK CERTIFICATES. Each stockholder shall be entitled to a
certificate or certificates representing in the aggregate the shares owned by
him or her and certifying the number and class thereof, which shall be in such
form as this Board shall adopt. Each certificate of stock shall be signed by the
President or a Vice President, and by the Treasurer or an Assistant Treasurer or
the Secretary or an

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<PAGE> 15

Assistant Secretary. Any of or all the signatures on the certificate may be a
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate has ceased to be
such officer, transfer agent or registrar before the certificate is issued, such
certificate may nevertheless be issued by the corporation with the same effect
as if he or she were such officer, transfer agent or registrar at the date of
issue.

SECTION 2. TRANSFER OF STOCK. Shares of stock shall be transferable on the
books of the corporation pursuant to applicable law and such rules and
regulations as the Board of Directors shall from time to time prescribe.

SECTION 3. HOLDERS OF RECORD. Prior to due presentment for registration of
transfer the corporation may treat the holder of record of a share of its stock
as the complete owner thereof exclusively entitled to vote, to receive
notifications and otherwise entitled to all the rights and powers of a complete
owner thereof, notwithstanding notice to the contrary.

SECTION 4. TRANSFER AGENT AND REGISTRAR. The Board of Directors may at any
time appoint a transfer agent or agents and/or registrar or registrars for the
transfer and/or registration of shares of stock.

SECTION 5. LOST, STOLEN, DESTROYED OR MUTILATED STOCK CERTIFICATES. The
Board of Directors may direct a new stock certificate or certificates to be
issued in place of any certificate or certificates theretofore issued by the
corporation alleged to have been lost, stolen, destroyed or mutilated, upon the
making of an affidavit of that fact by the person claiming the certificate of
stock to be lost, stolen, destroyed or mutilated. When authorizing such issue of
a new certificate or certificates, the Board of Directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost, stolen, destroyed or mutilated certificate or certificates, or his or her
legal representative, to (a) advertise the same in such manner as it shall
require and/or (b) give the corporation a bond in such sum as it may direct as
indemnity against any claim that may be made against the corporation with
respect to the certificate alleged to have been lost, stolen, destroyed or
mutilated and/or (c) comply with any other reasonable requirements prescribed by
the Board.

ARTICLE IX

SECURITIES OF OTHER CORPORATIONS

Subject to any limitations that may be imposed by the Board of Directors,
the Chairman of the Board of Directors, if any, the President or any person or
persons authorized by the Board may in the name and on behalf of the corporation
(i) act or appoint any other person or persons (with or without powers of
substitution) to act

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<PAGE> 16

in the name and on behalf of the corporation (as proxy or otherwise), at any
meeting of the holders of stock or other securities of any corporation or other
organization, securities of which shall be held by this corporation, or (ii)
express consent or dissent, as a holder of such securities, to corporate or
other action by such other corporation or organization.

ARTICLE X

CHECKS, NOTES, DRAFTS AND OTHER INSTRUMENTS

Checks, notes, drafts and other instruments for the payment of money drawn
or endorsed in the name of the corporation may be signed by any officer or
officers or person or persons authorized by the Board of Directors to sign the
same. No officer or person shall sign any such instrument as aforesaid unless
authorized by the Board to do so.

ARTICLE XI

DIVIDENDS AND RESERVES

SECTION 1. DIVIDENDS. Dividends upon the capital stock of the corporation
may, subject to any provisions of the certificate of incorporation, be declared
pursuant to law by the Board of Directors. Dividends may be paid in cash, in
property or in shares of the capital stock.

SECTION 2. RESERVES. Before payment of any dividend there may be set aside
out of any funds of the corporation available for dividends such sum or sums as
the Board of Directors from time to time, in its absolute discretion, thinks
proper as a reserve fund to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the corporation, or for such other
purpose as the Directors shall think conducive to the interest of the
corporation, and the Directors may modify or abolish any such reserve in the
manner in which it was created.

ARTICLE XII

CORPORATE SEAL

The corporate seal shall be in such form as the Board of Directors may
from time to time prescribe and the same may be used by causing it or a
facsimile thereof to be impressed or affixed or in any other manner reproduced.

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ARTICLE XIII

FISCAL YEAR

The fiscal year of the corporation shall end on the 31st day of December
of each year.

ARTICLE XIV

BOOKS AND RECORDS

The books, accounts and records of the corporation, except as may be
otherwise required by the laws of the State of Delaware, may be kept outside of
the State of Delaware, at such place or places as the Board of Directors may
from time to time appoint. Except as may otherwise be provided by law, the Board
of Directors shall determine whether and to what extent the books, accounts,
records and documents of the corporation, or any of them, shall be open to the
inspection of the stockholders, and no stockholder shall have any right to
inspect any book, account, record or document of the corporation, except as
conferred by law or by resolution of the stockholders or Board of Directors.

ARTICLE XV

NOTICES

SECTION 1. MANNER OF GIVING OF NOTICE. Whenever the provisions of a law,
the certificate of incorporation, the By-laws or rules of a committee require
notice to be given to any Director, officer, stockholder or member of a
committee, they shall not be construed to mean personal notice; such notice may
be given by telegram or by depositing such notice in a post office or letter
box, in a postage paid, sealed wrapper, addressed to such Director, officer,
stockholder or member of a committee at his or her address as the same appears
in the books or records of the corporation (unless he or she shall have filed
with the Secretary a written request that notice intended for him or her be sent
to some other address, in which case it shall be sent to the address designated
in the most recent such request); and the time when such telegram shall be
transmitted or notice deposited shall be deemed to be the time of the giving of
such notice.

SECTION 2. WAIVER OF NOTICE. Whenever notice is required by law, the
certificate of incorporation, the By-laws, or as otherwise provided by law, a
written waiver thereof, signed by the person entitled to notice, shall be deemed
equivalent to notice, whether signed before or after the time required for such
notice. Attendance

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of a person at a meeting shall constitute a waiver of notice of such meeting
except when the person attends a meeting for the express purpose of objecting,
at the beginning of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
stockholders, Directors or members of a committee of directors need be specified
in any written waiver of notice.

ARTICLE XVI

SEVERABILITY

If any term or provision of the By-laws, or the application thereof to any
person or circumstance or period of time, shall to any extent be invalid or
unenforceable, the remainder of the By-laws, or the application of such term or
provision to persons or circumstances or periods of time other than those as to
which it is invalid or unenforceable, shall not be affected thereby and each
term and provision of the By-laws shall be valid and enforced to the fullest
extent permitted by law.

ARTICLE XVII

AMENDMENTS

The Board of Directors and the stockholders shall each have the power to
adopt, alter, amend and repeal these By-laws; and any By-laws adopted by the
Directors or the stockholders under the powers conferred hereby may be altered,
amended or repealed by the Directors or by the stockholders.

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<PAGE> 1
Exhibit 10.6

BRIDGESTREET ACCOMMODATIONS, INC.

1997 EQUITY INCENTIVE PLAN

SECTION 1 PURPOSE AND DURATION

1.1 PURPOSES. The purposes of the Plan are to attract, retain and
motivate employees and consultants of the Company, its Parent (if any), and any
present or future Subsidiaries and to enable them to participate in the growth
of the Company by providing for or increasing the proprietary interests of such
persons in the Company.

1.2 EFFECTIVE DATE. The Plan is effective as of the date of its
adoption by the Board.

1.3 EXPIRATION DATE. The Plan shall expire one day less than ten
years from the date of the adoption of the Plan by the Board. In no event shall
any Awards be made under the Plan after such expiration date, but Awards
previously granted may extend beyond such date.

SECTION 2 DEFINITIONS

As used in the Plan, the following capitalized words shall have the
meanings indicated below:

"1933 Act" means the Securities Act of 1933, as amended.

"1934 Act" means the Securities Exchange Act of 1934, as amended.

"Award" means, individually or collectively, a grant under the Plan of
Options, SARs, Performance Shares, Restricted Stock or Stock Units.

"Award Agreement" means the written agreement setting forth the terms
and provisions applicable to an Award granted under the Plan.

"Board" means the Board of Directors of the Company.

"Code" means the Internal Revenue Code of 1986, as amended.

"Committee" means the committee of the Board appointed by the Board to
administer the Plan in accordance with Section 3.1.

"Company" means BridgeStreet Accommodations, Inc., a Delaware
corporation, or any successor thereto.

<PAGE> 2

"Director" means any individual who is a member of the Board.

"Fair Market Value" means, with respect to a Share, the fair market
thereof as of the relevant date of determination, as determined in accordance
with a valuation methodology approved by the Board in good faith but in no event
less than, in the case of newly issued stock, the par value per Share; provided
that if the Board does not adopt or employ any such valuation methodology and
Shares are traded on an exchange or quoted on The Nasdaq National Market, fair
market value shall mean, on the relevant date of determination, the closing
price of a Share traded on the principal exchange for the Shares or, if the
Shares are so traded, the closing or last price quoted on The Nasdaq National
Market.

"Grant Date" means the effective date of an Award as specified by the
Board and set forth in the applicable Award Agreement.

"Incentive Stock Option" or "ISO" means an option to purchase Shares
awarded to a Participant under Section 6 of the Plan that is intended to meet
the requirements of Section 422 of the Code.

"Non-Employee Director" means a "non-employee director" as that term is
defined in Rule 16b-3 promulgated under the 1934 Act.

"Nonqualified Stock Option" or "NQO" means an option to purchase Shares
awarded to a Participant under Section 6 of the Plan that is not intended to be
an ISO.

"Option" means an ISO or an NQO.

"Parent" means a "parent corporation" as that term is defined in Section
424 of the Code.

"Participant" means an individual who has been selected by the Board to
receive an Award under the Plan.

"Performance Cycle" means the period of time selected by the Board
during which performance is measured for the purpose of determining the extent
to which an Award of Performance Shares has been earned. More than one
Performance Cycle may be in progress at any one time and the duration of
Performance Cycles may differ.

"Performance Share" means a Share awarded to a Participant under Section
8 of the Plan that entitles the Participant to acquire Shares upon the
attainment of specified performance goals.

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<PAGE> 3

"Plan" means the 1997 Equity Incentive Plan set forth in this document
and as hereafter amended from time to time in accordance with Section 13.

"Restricted Period" means the period of time selected by the Board
during which Shares of Restricted Stock are subject to forfeiture and/or
restrictions on transferability.

"Restricted Stock" means Shares awarded to a Participant under Section 9
of the Plan pursuant to an Award that entitles the Participant to acquire Shares
for a purchase price (which may be zero), subject to such conditions, including
a Company right during a specified period or periods to repurchase the Shares at
their original purchase price (or to require forfeiture of the Shares if the
purchase price was zero) upon the Participant's termination of employment.

"SAR" or "Stock Appreciation Right" means an Award that is designated as
an SAR pursuant to Section 7 of the Plan, granted alone or in connection with a
related Award, entitling a Participant to receive an amount in cash or Shares or
a combination thereof having a value equal to (or if the Board shall so
determine at time of grant, less than) the excess of the Fair Market Value of a
Share on the date of exercise over the Fair Market Value of a Share on the Grant
Date (or over the Option exercise price, if the Stock Appreciation Right was
granted in tandem with an Option) multiplied by the number of Shares with
respect to which the Stock Appreciation Right is exercised.

"Shares" means shares of the Company's common stock, par value $0.01 per
share.

"Stock Unit" means an Award of a Share or a unit valued in whole or in
part by reference to, or otherwise based on, the value of a Share, granted to a
Participant under Section 10 of the Plan.

"Subsidiary" means a "subsidiary corporation" as that term is defined in
Section 424 of the Code.

SECTION 3 ADMINISTRATION OF THE PLAN

3.1 THE BOARD. The Plan shall be administered by the Board. The
Board may, in its discretion, delegate some or all of its powers with respect to
the Plan to the Committee, in which event all references in the Plan to the
Board (except references in Section 13.1) shall be deemed to refer to the
Committee. The Committee, if one is appointed, shall consist of at least two
Non-Employee Directors.

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<PAGE> 4

3.2 AUTHORITY OF THE BOARD. The Board shall have the authority to
adopt, alter and repeal such administrative rules, guidelines and practices
governing the operation of the Plan as it shall consider advisable from time to
time, to interpret the provisions of the Plan and any Award, and to decide all
disputes arising in connection with the Plan. The Board's decisions and
interpretations shall be final and binding.

SECTION 4 ELIGIBILITY OF PARTICIPANTS

The persons eligible to receive Awards under the Plan shall be all
executive officers of the Company, its Parent (if any), and any Subsidiaries and
other employees, consultants and advisers who, in the opinion of the Board, are
in a position to make a significant contribution to the success of the Company,
its Parent (if any), and any Subsidiaries. Directors, including directors who
are not employees, of the Company, its Parent (if any), and any Subsidiaries,
shall be eligible to receive Awards under the Plan.

SECTION 5 STOCK AVAILABLE FOR AWARDS

5.1 NUMBER OF SHARES. Awards may be made under the Plan for up to
One Million (1,000,000) Shares. Shares issued under the Plan may consist in
whole or in part of authorized but unissued Shares or treasury Shares.

5.2 LAPSED, FORFEITED OR EXPIRED AWARDS. If any Award in respect of
Shares expires or is terminated before exercise or is forfeited for any reason,
the Shares subject to such Award, to the extent of such expiration, termination,
or forfeiture, shall again be available for award under the Plan.

5.3 MAXIMUM NUMBER OF SHARES TO A SINGLE PARTICIPANT IN ANY CALENDAR
YEAR. In no event shall any Participant receive in any calendar year Awards
under the Plan and any other grants for more than Two Hundred Thousand (200,000)
Shares.

SECTION 6 STOCK OPTIONS

6.1 GRANT OF OPTIONS. Subject to the terms and provisions of the
Plan, the Board may award Options and determine the number of shares to be
covered by each Option, the exercise price therefor, the term of the Option, and
any other conditions and limitations applicable to the exercise of the Option.
The Board may grant ISOs, NQOs or a combination thereof.

6.2 EXERCISE PRICE. Subject to the provisions of this Section 6, the
exercise price for each Option shall be determined by the Board in its sole
discretion.

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<PAGE> 5

6.3 RESTRICTIONS ON OPTION TRANSFERABILITY AND EXERCISABILITY. No
Option shall be transferable by the Participant other than by will or the laws
of descent and distribution, and all Options shall be exercisable, during the
Participant's lifetime, only by the Participant; provided, however, that the
Board may provide that an Option is transferable by the Participant and
exercisable by persons other than the Participant upon such terms and conditions
as the Board shall determine.

6.4 CERTAIN ADDITIONAL PROVISIONS FOR INCENTIVE STOCK OPTIONS

6.4.1 EXERCISE PRICE. In the case of an ISO, the exercise price shall
be not less than one hundred percent (100%) of the Fair Market Value on the
Grant Date of the Shares subject to the Option; provided, however, that if on
the Grant Date the Participant (together with persons whose stock ownership is
attributed to the Participant pursuant to Section 424(d) of the Code) owns stock
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company, its Parent (if any) or any Subsidiaries, the
exercise price shall be not less than one hundred and ten percent (110%) of the
Fair Market Value on the Grant Date of the Shares subject to the Option.

6.4.2 EXERCISABILITY. Subject to Section 12.3 and 12.4, the aggregate
Fair Market Value (determined on the Grant Date(s)) of the Shares with respect
to which ISOs are exercisable for the first time by any Participant during any
calendar year (under all plans of the Company, its Parent (if any) and any
Subsidiaries) shall not exceed $100,000.

6.4.3 ELIGIBILITY. ISOs may be granted only to persons who are
employees of the Company, its Parent (if any) or any Subsidiaries on the Grant
Date.

6.4.4 EXPIRATION. No ISO may be exercised later than ten (10) years
from the Grant Date; provided, however, that if the Option is granted to a
Participant who, together with persons whose stock ownership is attributed to
the Participant pursuant to Section 424(d) of the Code, owns stock possessing
more than ten percent (10%) of the total combined voting power of all classes of
stock of the Company, its Parent (if any) or any Subsidiaries, the ISO may not
be exercised later than five (5) years from the Grant Date.

6.4.5 COMPLIANCE WITH SECTION 422 OF THE CODE. The terms and
conditions of ISOs shall be subject to and comply with Section 422 of the Code
or any successor provision.

6.4.6 NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION. Each Participant
who receives an ISO agrees to notify the Company in writing immediately after
the Participant makes a Disqualifying Disposition of any Shares received
pursuant to the exercise of an ISO. The term "Disqualifying Disposition" means
any disposition

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<PAGE> 6

(including any sale) of Shares before the later of (a) two years after the
Participant was granted the ISO under which the Participant acquired such
Shares, or (b) one year after the Participant acquired the Shares by exercising
the ISO.

6.4.7 SUBSTITUTE OPTIONS. Notwithstanding the provisions of Section
6.4.1, in the event that the Company, its Parent (if any) or any Subsidiary
consummates a transaction described in Section 424(a) of the Code (relating to
the acquisition of property or stock from an unrelated corporation), individuals
who become employees or consultants of the Company, its Parent (if any) or any
Subsidiary on account of such transaction may be granted ISOs in substitution
for options granted by their former employer. The Board, in its sole discretion
and consistent with Section 424(a) of the Code, shall determine the exercise
price of such substitute Options.

6.5 NQO PRESUMPTION. Options granted pursuant to the Plan shall be
presumed to be NQOs unless expressly designated ISOs in the Award Agreement.

SECTION 7 GRANT OF STOCK APPRECIATION RIGHTS

Subject to the terms and provisions of the Plan, the Board may award
SARs in tandem with another Award (at or after the Grant Date of the other
Award), or alone and unrelated to another Award, and may determine the terms and
conditions applicable thereto, including the form of payment.

SECTION 8 PERFORMANCE SHARES

8.1 GRANT OF PERFORMANCE SHARES. The Board may award Performance
Shares to Participants and determine the performance goals applicable to each
such Award, the number of Shares for each Performance Cycle, the duration of
each Performance Cycle and all other limitations and conditions applicable to
the awarded Performance Shares. The payment value of each Performance Share
shall be equal to the Fair Market Value of one Share on the date the Performance
Share is earned or, in the discretion of the Board, on the date the Board
determines that the Performance Share has been earned.

8.2 ADJUSTMENT OF PERFORMANCE GOALS. Except as provided in an Award,
during any Performance Cycle, the Board may adjust the performance goals for the
Performance Cycle as it deems equitable in recognition of unusual or
non-recurring events affecting the Company or its Shares, changes in applicable
tax laws or accounting principles, or such other factors as the Board shall
determine.

8.3 WRITTEN CERTIFICATION. As soon as practical after the end of a
Performance Cycle, the Board shall certify in writing the extent to which the

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<PAGE> 7

performance goals applicable to each Participant for the Performance Cycle were
achieved or exceeded and the number of Performance Shares which have been earned
on the basis of performance in relation to the established performance goals.

SECTION 9 RESTRICTED STOCK

9.1 GRANT OF RESTRICTED STOCK. The Board may award Shares of
Restricted Stock and determine the purchase price, if any, therefor, the
duration of the Restricted Period, the conditions under which the Shares may be
forfeited to or repurchased by the Company and any other terms and conditions of
the Awards. The Board may modify or waive any restrictions, terms and conditions
with respect to any Restricted Stock. Shares of Restricted Stock may be issued
for whatever consideration is determined by the Board, subject to applicable
law.

9.2 TRANSFERABILITY. Shares of Restricted Stock may not be sold,
assigned, transferred, pledged or otherwise encumbered, except as permitted by
the Board, during the Restricted Period.

9.3 EVIDENCE OF AWARD. Shares of Restricted Stock shall be evidenced
in such manner as the Board may determine. Any certificates issued in respect of
Shares of Restricted Stock shall be registered in the name of the Participant
and unless otherwise determined by the Board, deposited by the Participant,
together with a stock power endorsed in blank, with the Company. At the
expiration of the Restricted Period, the Company shall deliver the certificates
and stock power to the Participant.

9.4 SHAREHOLDER RIGHTS. A Participant shall have all the rights of a
shareholder with respect to Restricted Stock awarded, including voting and
dividend rights, unless otherwise provided in the Award Agreement.

SECTION 10 STOCK UNITS

10.1 GRANT OF STOCK UNITS. Subject to the terms and provisions of the
Plan, the Board may award Stock Units subject to such terms, restrictions,
conditions, performance criteria, vesting requirements and payment rules as the
Board shall determine.

10.2 CONSIDERATION. Shares awarded in connection with a Stock Unit
shall be issued for whatever consideration is determined by the Board, subject
to applicable law.

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<PAGE> 8

SECTION 11 OTHER AWARDS

The Board shall have the authority to specify the terms and provisions
of other forms of equity-based or equity-related Awards not described above
which the Board determines to be consistent with the purposes of the Plan and
the interests of the Company, which Awards may provide for cash payments based
in whole or in part on the value or future value of Shares, for the acquisition
or future acquisition of Shares, or any combination thereof. Other Awards may
also include cash payments (including the cash payment of dividend equivalents)
under the Plan which may be based on one or more criteria determined by the
Board that are unrelated to the value of the Shares and that may be granted in
tandem with, or independent of, other Awards under the Plan.

SECTION 12 GENERAL PROVISIONS APPLICABLE TO AWARDS

12.1 LEGAL AND REGULATORY MATTERS. The delivery of Shares shall be
subject to compliance with (i) applicable federal and state laws and
regulations, (ii) if the outstanding Shares are listed at the time on any stock
exchange or automated quotation system, the listing requirements of such
exchange or system, and (iii) the Company's counsel's approval of all other
legal matters in connection with the issuance and delivery of the Shares. If the
sale of the Shares has not been registered under the 1933 Act, the Company may
require, as a condition to delivery of the Shares, such representations or
agreements as counsel for the Company may consider appropriate to avoid
violation of such Act and may require that the certificates evidencing the
Shares bear an appropriate legend restricting transfer.

12.2 AWARD AGREEMENT. The terms and provisions of an Award shall be
set forth in an Award Agreement approved by the Board and delivered or made
available to the Participant as soon as practicable following the Grant Date.

12.3 DETERMINATION OF RESTRICTIONS ON THE AWARD. The vesting,
exercisability, payment and other restrictions applicable to an Award (which may
include, without limitation, restrictions on transferability or provision for
mandatory resale to the Company) shall be determined by the Board and set forth
in the applicable Award Agreement. Notwithstanding the foregoing, the Board may
accelerate (i) the vesting or payment of any Award (including an ISO), (ii) the
lapse of restrictions on any Award (including an Award of Restricted Stock) and
(iii) the date on which any Option or SAR first becomes exercisable.

12.4 MERGERS, ETC. Notwithstanding any other provision of the Plan,
in the event of a consolidation or merger in which the Company is not the
surviving corporation or which results in the acquisition of substantially all
the Company's outstanding shares by a single person or entity or by a group of
persons and/or entities

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<PAGE> 9

acting in concert, or in the event of the sale or transfer of substantially all
the Company's assets, then if the Board so determines, all outstanding Awards
shall terminate, provided that at least twenty (20) days prior to the effective
date of any such merger, consolidation or sale of assets, the Board shall either
(i) make all outstanding Awards exercisable immediately prior to the
consummation of such merger, consolidation or sale of assets or (ii) if there is
a surviving or acquiring corporation, arrange, subject to consummation of the
merger, consolidation or sale of assets, to have that corporation or an
affiliate of that corporation grant to Participants replacement Awards, which
Awards in the case of ISOs shall satisfy, in the discretion of the Board, the
requirements of section 424(a) of the Code.

12.5 TERMINATION OF EMPLOYMENT. For purposes of the Plan, the
following events shall not be deemed a termination of employment of a
Participant: (i) a transfer to the employment of the Company from its Parent (if
any) or from a Subsidiary, or from the Company to its Parent (if any) or to a
Subsidiary, or from one Subsidiary to another, or from the Company's Parent (if
any) to a Subsidiary, or from a Subsidiary to the Company's Parent (if any); or
(ii) an approved leave of absence for military service or sickness, or for any
other purpose approved by the Company, if the Participant's right to employment
is guaranteed either by a statute or by contract or under the policy pursuant to
which the leave of absence was granted or if the Board otherwise so provides in
writing. For purposes of the Plan, employees of a Subsidiary or Parent (if any)
shall be deemed to have terminated their employment on the date on which such
Subsidiary or Parent ceases to be a Subsidiary or Parent of the Company, as the
case may be.

12.6 DATE OF AND EFFECT OF TERMINATION OF EMPLOYMENT. The date of a
Participant's termination of employment for any reason shall be determined in
the sole discretion of the Board. The Board shall have full authority to
determine and specify in the applicable Award Agreement the effect, if any, that
a Participant's termination of employment for any reason will have on the
vesting, exercisability, payment or lapse of restrictions applicable to an
outstanding Award.

12.7 GRANT OF AWARDS. Each Award may be made alone, in addition to or
in relation to any other Award. The terms of each Award need not be identical,
and the Board need not treat Participants uniformly.

12.8 SETTLEMENT OF AWARDS. No Shares shall be delivered pursuant to
any exercise of an Award until payment in full of the price therefor, if any, is
received by the Company. Such payment may be made in whole or in part in cash or
by certified or bank check or, to the extent permitted by the Board at or after
the Grant Date, by delivery of a note or Shares, including Restricted Stock,
valued at their Fair Market Value on the date of delivery, or such other lawful
consideration as the Board shall determine.

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<PAGE> 10

12.9 WITHHOLDING REQUIREMENTS AND ARRANGEMENTS. The Participant shall
pay to the Company or make provision satisfactory to the Board for payment of
any taxes required by law to be withheld in respect of Awards under the Plan no
later than the date of the event creating the tax liability. In the Board's
discretion, such tax obligations may be paid in whole or in part in Shares,
including Shares retained from the Award creating the tax obligation, valued at
their Fair Market Value on the date of delivery. The Company may, to the extent
permitted by law, deduct any such tax obligations from any payment of any kind
otherwise due to the Participant.

12.10 NO EFFECT ON EMPLOYMENT. The Plan shall not give rise to any
right on the part of any Participant to continue in the employ of the Company,
its Parent (if any) or any Subsidiary. The loss of existing or potential profit
in Awards granted under the Plan shall not constitute an element of damages in
the event of termination of the relationship of a Participant even if the
termination is in violation of an obligation of the Company to the Participant
by contract or otherwise.

12.11 NO RIGHTS AS SHAREHOLDER. Subject to the provisions of the Plan
and the applicable Award Agreement, no Participant shall have any rights as a
shareholder with respect to any Shares to be distributed under the Plan until he
or she becomes the holder thereof.

12.12 ADJUSTMENTS. Upon the happening of any of the following
described events, a Participant's rights with respect to Awards granted
hereunder shall be adjusted as hereinafter provided, unless otherwise
specifically provided in the Award Agreement.

12.12.1 STOCK SPLITS AND RECAPITALIZATIONS. In the event the Company
issues any of its Shares as a stock dividend upon or with respect to the Shares,
or in the event Shares shall be subdivided or combined into a greater or smaller
number of Shares, or if, upon a merger or consolidation (except those described
in Section 12.4), reorganization, split-up, liquidation, combination,
recapitalization or the like of the Company, Shares shall be exchanged for other
securities of the Company, securities of another entity, cash or other property,
each Participant upon exercising an Award (for the aggregate purchase price to
be paid under the Award) shall be entitled to purchase such number of Shares,
other securities of the Company, securities of such other entity, cash or other
property as the Participant would have received if the Participant had been the
holder of the Shares with respect to which the Award is exercised at all times
between the Grant Date of the Award and the date of its exercise, and
appropriate adjustments shall be made in the purchase price per Share.

12.12.2 RESTRICTED STOCK. If any person owning Restricted Stock receives
new or additional or different shares or securities ("New Securities") in
connection with a corporate transaction described in Section 12.12.1 as a result
of owning such Restricted Stock, the New Securities shall be subject to all of
the conditions and

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<PAGE> 11

restrictions applicable to the Restricted Stock with respect to which such New
Securities were issued.

12.12.3 BOARD DETERMINATION. Notwithstanding any provision to the
contrary, no adjustments shall be made pursuant to this Section 12.12 with
respect to ISOs unless (i) the Board, after consulting with counsel for the
Company, determines that such adjustments would not constitute a "modification,"
"extension" or "renewal" of such ISOs as such terms are defined in Section 424
of the Code, (ii) would cause any adverse tax consequences for the holders of
such ISOs or (iii) the holders of such ISOs consent to the adjustment. No
adjustments to ISOs shall be made for dividends paid in cash or in property
other than securities of the Company.

12.12.4 FRACTIONAL SHARES. No fractional Shares shall be issued under
the Plan. Any fractional Shares which, but for this Section, would have been
issued shall be deemed to have been issued and immediately sold to the Company
for their Fair Market Value, and the Participant shall receive from the Company
cash in lieu of such fractional Shares.

12.12.5 OTHER DISTRIBUTIONS. The Board may adjust the number of Shares
subject to outstanding Awards and the exercise price and the terms of
outstanding Awards to take into consideration material changes in accounting
practices or principles, extraordinary dividends, acquisitions or dispositions
of stock or property, or any other event if it is determined by the Board that
such adjustment is appropriate to avoid distortion in the operation of the Plan.

12.12.6 FURTHER ADJUSTMENT. Upon the happening of any of the events
described in Sections 12.12.1 or 12.12.5, the class and aggregate number of
Shares set forth in Sections 5.1 and 5.3 hereof that are subject to Awards which
previously have been or subsequently may be granted under the Plan shall be
appropriately adjusted to reflect the events described in such Sections. The
Board shall determine the specific adjustments to be made under this Section
12.12.6.

SECTION 13 AMENDMENT AND TERMINATION

13.1 AMENDMENT, SUSPENSION, TERMINATION OF THE PLAN. The Board may
modify, amend, suspend or terminate the Plan in whole or in part at any time;
provided, however, that no modification, amendment, suspension or termination of
the Plan shall be made without shareholder approval if such approval is
necessary to comply with any applicable tax or regulatory requirement; and
provided, further, that such modification, amendment, suspension or termination
shall not, without a Participant's consent, affect adversely the rights of such
Participant with respect to any Award previously made.

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<PAGE> 12

13.2 AMENDMENT, SUSPENSION, TERMINATION OF AN AWARD. The Board may
modify, amend or terminate any outstanding Award, including, without limitation,
substituting therefor another Award of the same or a different type, changing
the date of exercise or realization and converting an ISO to a NQO; provided,
however, that the Participant's consent to such action shall be required unless
the Board determines that the action, taking into account any related action,
would not materially and adversely affect the Participant.

SECTION 14 LEGAL CONSTRUCTION

14.1 CAPTIONS. The captions provided herein are included solely for
convenience of reference and shall not affect the meaning of any of the
provisions of the Plan or serve as a basis for interpretation or construction of
the Plan.

14.2 SEVERABILITY. In the event any provision of the Plan is held
invalid or illegal for any reason, the illegality or invalidity shall not affect
the remaining provisions of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.

14.3 GOVERNING LAW. The Plan and all rights under the Plan shall be
construed in accordance with and governed by the internal laws of the State of
Delaware.

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<PAGE> 1
Exhibit 10.7

BRIDGESTREET ACCOMMODATIONS, INC.

STOCK PLAN FOR NON-EMPLOYEE DIRECTORS

1. PURPOSE
-------

The purpose of this Stock Plan for Non-Employee Directors (the "Plan")
is to advance the interests of BridgeStreet Accommodations, Inc. (the "Company")
by enhancing the ability of the Company to attract and retain non-employee
directors who are in a position to make significant contributions to the success
of the Company and to reward directors for such contributions through ownership
of shares of the Company's common stock (the "Stock").

2. ADMINISTRATION
--------------

The Plan shall be administered by a committee (the "Committee") of the
Board of Directors (the "Board") of the Company designated by the Board for that
purpose. Unless and until a Committee is appointed the Plan shall be
administered by the entire Board, and references in the Plan to the "Committee"
shall be deemed references to the Board. The Committee shall have authority, not
inconsistent with the express provisions of the Plan, (a) to grant options in
accordance with the Plan to such directors as are eligible to receive options;
(b) to prescribe the form or forms of instruments evidencing options and any
other instruments required under the Plan and to change such forms from time to
time; (c) to adopt, amend and rescind rules and regulations for the
administration of the Plan; and (d) to interpret the Plan and to decide any
questions and settle all controversies and disputes that may arise in connection
with the Plan. Such determinations of the Committee shall be conclusive and
shall bind all parties.

3. EFFECTIVE DATE AND TERM OF PLAN
-------------------------------

The Plan shall become effective on the date on which the Plan is
approved by the Board of Directors of the Company. No option shall be granted
under the Plan after the completion of ten years from the date on which the Plan
was adopted by the Board, but options previously granted may extend beyond that
date.

4. SHARES SUBJECT TO THE PLAN
--------------------------

(a) NUMBER OF SHARES. Subject to adjustment as provided in section
4(c), the aggregate number of shares of Stock that may be delivered upon the
exercise of options granted under the Plan shall be One Hundred Thousand
(100,000). If any option granted under the Plan terminates without having been
exercised in full, the number of shares of Stock as to which such option was not
exercised shall be available for future grants within the limits set forth in
this Section 4(a).

<PAGE> 2

(b) SHARES TO BE DELIVERED. Shares delivered under the Plan shall be
authorized but unissued Stock or, if the Board so decides in its sole
discretion, previously issued Stock acquired by the Company and held in
treasury. No fractional shares of Stock shall be delivered under the Plan.

(c) CHANGES IN STOCK. In the event of a stock dividend, stock split
or combination of shares, recapitalization or other change in the Company's
capital stock after the date of the closing of the Company's initial public
offering (the "IPO") of Stock (the "Closing"), the number and kind of shares of
stock or securities of the Company subject to options then outstanding or
subsequently granted under the Plan, the maximum number of shares or securities
that may be delivered under the Plan, the exercise price and other relevant
provisions shall be appropriately adjusted by the Committee, whose determination
shall be binding on all persons.

5. ELIGIBILITY FOR OPTIONS
-----------------------

Directors eligible to receive options under the Plan ("Eligible
Directors") shall be those directors who are not employees of the Company or of
any subsidiary of the Company and who neither hold five percent or more of the
Company's outstanding Stock nor were stockholders of the Company prior to the
registration of the Company's Stock under the Securities Exchange Act of 1934,
as amended (the "Exchange Act").

6. TERMS AND CONDITIONS OF OPTIONS
-------------------------------

(a) Number of Options.
-----------------

(i) Effective upon the date of the final Prospectus used in
connection with the IPO, each Eligible Director shall be
awarded an option covering Twelve Thousand Five Hundred
(12,500) shares of Stock; thereafter, immediately
following an annual meeting of shareholders or other
event by which an Eligible Director initially is elected
to serve, he or she shall be awarded an option covering
Seven Thousand Five Hundred (7,500) shares of Stock.

(ii) Subsequent option awards shall be made as follows:

(A) For each Eligible Director who received an
initial option grant under this plan by virtue of an
event that was not an annual meeting of shareholders, on
every third anniversary of such event (i.e., on the
third, sixth, ninth, twelfth, etc., anniversaries),
provided he or she still is an Eligible Director on such
date, he or she shall receive an option covering Seven
Thousand Five Hundred (7,500) shares of Stock.

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<PAGE> 3

(B) For each Eligible Director who received an
initial option grant under this plan at an annual
meeting of shareholders, immediately following every
third annual meeting following the meeting that yielded
the initial grant (i.e., on the third, sixth, ninth,
twelfth, etc., meetings following such meeting),
provided he or she is reelected to be a director at such
meeting and continues to be an Eligible Director at such
time, he or she shall receive an option covering Seven
Thousand Five Hundred (7,500) shares of Stock.

(b) EXERCISE PRICE. The exercise price of each option shall be 100%
of the Fair Market Value per share of the Stock at the time the option is
granted. In no event, however, shall the exercise price be less, in the case of
an original issue of authorized stock, than par value per share. For purposes of
this paragraph, (A) the "Fair Market Value" of a share of Stock on any date
shall be the Closing Price on such day or, if there was no Closing Price on such
day, the latest day prior thereto on which there was a Closing Price; and (B)
the "Closing Price" of the Stock on any business day will be the last sale price
as reported on the principal market or automated quotation system on which the
Stock is traded or, if no last sale is reported, then the mean between the
highest bid and lowest asked prices on that day.

(c) DURATION OF OPTIONS. The latest date on which an option may be
exercised (the "Final Exercise Date") shall be the date which is ten years from
the date the option was granted.

(d) Exercise of Options.
-------------------

(1) Except as otherwise provided in this Section 6, each option
shall become exercisable with respect to one-third of the shares
of Stock issuable thereunder on each of the first three
anniversaries of the date of grant.

(2) Any exercise of an option shall be in writing, signed by the
proper person and delivered or mailed to the Company,
accompanied by (i) any documentation required by the Committee
and (ii) payment in full for the number of shares for which the
option is exercised.

(3) The Committee shall have the right to require that the
individual exercising the option remit to the Company an amount
sufficient to satisfy any federal, state, or local withholding
tax requirements (or make other arrangements satisfactory to the
Company with regard to such taxes) prior to the delivery of any
Stock pursuant to the exercise of the option. If permitted by
the Committee the individual exercising the option may elect, at
such time and in such manner as the Committee may prescribe, to
have the Company hold back from the transfer Stock having a
value calculated to satisfy such withholding obligation. In the
case of an individual subject to Section 16(b) of the Exchange
Act, no such election shall be effective unless made in
compliance with the applicable

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<PAGE> 4

requirements of Rule 16b-3 or any successor Rule then in effect
under the Exchange Act.

(4) If an option is exercised by the executor or administrator of a
deceased director, or by the person or persons to whom the
option has been transferred by the director's will or the
applicable laws of descent and distribution, the Company shall
be under no obligation to deliver Stock pursuant to such
exercise until the Company is satisfied as to the authority of
the person or persons exercising the option.

(e) PAYMENT FOR AND DELIVERY OF STOCK. Stock purchased under the
Plan shall be paid for as follows: (i) in cash or by check (acceptable to the
Company in accordance with guidelines established for this purpose), bank draft
or money order payable to the order of the Company or (ii) if so permitted by
the original terms of the option or by the Committee after grant of the option,
(A) through the delivery of shares of Stock (in compliance with all relevant
provisions under Section 16 of the Exchange Act) having a Fair Market Value on
the last business day preceding the date of exercise equal to the purchase price
or (B) by having the Company hold back from the shares transferred upon exercise
Stock having a Fair Market Value on the last business day preceding the date of
exercise equal to the purchase price or (C) by delivery of a promissory note of
the option holder to the Company, such note to be payable on such terms as are
specified and approved in advance by the Company or (D) by delivery of an
unconditional and irrevocable undertaking by a broker to deliver promptly to the
Company sufficient funds to pay the exercise price or (E) by any combination of
the permissible forms of payment.

An option holder shall not have the rights of a shareholder with regard
to awards under the Plan except as to Stock actually received by him or her
under the Plan.

The Company shall not be obligated to deliver any shares of Stock (a)
until, in the opinion of the Company's counsel, all applicable federal and state
laws and regulations have been complied with, and (b) if the outstanding Stock
is at the time listed on any stock exchange or automated quotation system, until
the shares to be delivered have been listed or authorized to be listed on such
exchange or system upon official notice of issuance, and (c) until all other
legal matters in connection with the issuance and delivery of such shares have
been approved by the Company's counsel. If the sale of Stock has not been
registered under the Securities Act of 1933, as amended (the "Act"), the Company
may require, as a condition to exercise of the option, such representations or
agreements as counsel for the Company may consider appropriate to avoid
violation of such Act and may require that the certificates evidencing such
Stock bear an appropriate legend restricting transfer.

(f) NONTRANSFERABILITY OF OPTIONS. Except to the extent the
Committee otherwise approves, no option may be transferred other than by will or
by the laws of descent and distribution, and during an Eligible Director's
lifetime an option may be exercised only by him or her.

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<PAGE> 5

(g) DEATH. Upon the death of any Eligible Director granted options
under this Plan, all options not then exercisable shall terminate. All options
held by the director that are exercisable immediately prior to death may be
exercised by his or her executor or administrator, or by the person or persons
to whom the option is transferred by will or the applicable laws of descent and
distribution, at any time within one year after the director's death (subject,
however, to the limitations of Section 6(c) regarding the maximum exercise
period for such option). After completion of such one-year period, such options
shall terminate to the extent not previously exercised.

(h) OTHER TERMINATION OF STATUS OF DIRECTOR. If a director's service
with the Company terminates for any reason other than death, all options held by
the director that are not then exercisable shall terminate. Options that are
exercisable on the date of termination shall continue to be exercisable for a
period of three months (subject to Section 6(c)). After completion of such
three-month period, such options shall terminate to the extent not previously
exercised, expired or terminated.

(i) MERGERS, ETC. In the event of a consolidation or merger in which
the Company is not the surviving corporation or which results in the acquisition
of substantially all the Company's outstanding Stock by a single person or
entity or by a group of persons and/or entities acting in concert, or in the
event of a sale or transfer of substantially all of the Company's assets or a
dissolution or liquidation of the Company, all options hereunder will terminate
upon the effective date of such merger, consolidation, sale, dissolution or
liquidation (the "Effective Date"); provided, that 20 days prior to the
Effective Date, all options outstanding hereunder that are not otherwise
exercisable shall become immediately exercisable.

7. EFFECT, DISCONTINUANCE, CANCELLATION, AMENDMENT, TERMINATION AND
----------------------------------------------------------------
EFFECTIVENESS
-------------

Neither adoption of the Plan nor the grant of options to a director
shall affect the Company's right to grant to such director options that are not
subject to the Plan, to issue to such directors Stock as a bonus or otherwise,
or to adopt other plans or arrangements under which Stock may be issued to
directors.

The Committee may at any time terminate the Plan as to any further
grants of options. The Committee may at any time or times, but in no event
(except to comply with the provisions of the Internal Revenue Code, the Employee
Retirement Income Security Act or the rules thereunder) more than once in any
six-month period, amend the Plan for any purpose which may at the time by
permitted by law.

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<PAGE> 1
Exhibit 10.12

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made and entered into effective as of January 2, 1997
by and between BridgeStreet International Inc, a Delaware corporation
("BridgeStreet"), and Mark D. Gagne, of Andover, Massachusetts (the
"Executive").

In consideration of the mutual promises, terms, provisions and
conditions set forth in this Agreement, the parties hereby agree as follows:

1. EMPLOYMENT. Subject to the terms and conditions set forth in
this Agreement, BridgeStreet hereby offers and the Executive hereby accepts
employment.

2. TERM. Subject to earlier termination as hereafter provided, the
Executive's employment hereunder shall be for a term beginning January 2, 1997
and ending May 31, 2000. The term of this Agreement, as from time to time
extended or renewed, is hereafter referred to as "the term of this Agreement" or
"the term hereof."

3. CAPACITY AND PERFORMANCE.

(a) During the term hereof, the Executive shall serve as the
Chief Financial Officer of BridgeStreet. In addition, and without
further compensation, the Executive shall serve as a director and/or
officer of BridgeStreet and/or one or more of BridgeStreet's Affiliates
if so elected or appointed from time to time.

(b) During the term hereof, the Executive shall be employed
by BridgeStreet on a full-time basis. The Executive shall have all
powers and duties consistent with his position, subject to the direction
and control of BridgeStreet's Chief Executive Officer and Board of
Directors (the "Board"), and shall perform such other duties and
responsibilities on behalf of BridgeStreet and its Affiliates as may
reasonably be designated from time to time by the Chief Executive
Officer or the Board or its designees.

(c) During the term hereof, the Executive shall devote his
full business time and his best efforts, business judgment, skill and
knowledge exclusively to the advancement of the business and interests
of BridgeStreet and its Affiliates and to the discharge of his duties
and responsibilities hereunder. During the term hereof, the Executive
shall not engage in any other business activity or serve in any
industry, trade, professional, governmental or academic position during
the term of this Agreement without permission of the Board.

<PAGE> 2

4. COMPENSATION AND BENEFITS. As compensation for all services
performed by the Executive under and during the term hereof and subject to
performance of the Executive's duties and of the obligations of the Executive,
pursuant to this Agreement or otherwise:

(a) BASE SALARY. During the term hereof, BridgeStreet shall
pay the Executive a base salary at the rate of one hundred twenty-five
thousand dollars ($125,000) per annum, payable in accordance with the
payroll practices of BridgeStreet for its executives and subject to
increase from time to time by the Board or the Compensation Committee of
the Board, in its sole discretion. Such base salary, as from time to
time increased, is hereafter referred to as the "Base Salary".

(c) STOCK OPTIONS. Effective as of the pricing date of
BridgeStreet's initial public offering (the "IPO"), and subject to the
closing thereof, the Executive shall be granted stock options to
purchase seventy-five thousand (75,000) shares of Common Stock of
BridgeStreet at a price per share equal to the IPO price per share of
BridgeStreet Common Stock. Such stock options shall be granted pursuant
to, and shall be subject to the terms and conditions of, BridgeStreet's
employee stock option plan or other equity incentive plan then in effect
and the policies of the Board then in effect with regard to the grant of
stock options and the terms hereof, but shall in all events provide as
follows:

(i) The term of the stock options shall be for ten
years (subject to earlier termination as set forth in the plan
for merger and similar transactions).

(ii) The stock options shall become exercisable in
equal installments on the first, second and third anniversaries
of the date of the IPO provided that on each such date the
Executive is employed by BridgeStreet.

(iii) In the event that the Company undergoes a Change
in Control (as defined in Exhibit B attached hereto) all of the
stock options shall become exercisable effective on the date of
the Change in Control.

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<PAGE> 3

(iv) In the event BridgeStreet terminates the
Executive's employment with BridgeStreet notwithstanding the
terms of this Agreement, all of the stock options shall become
exercisable and shall remain exercisable for a period of one
year from the date of termination. In the event BridgeStreet
terminates the Executive's employment with BridgeStreet for
Cause (as hereinafter defined), all of the stock options
exercisable by the Executive on the date of termination shall be
exercisable for a period of three months from the date of
termination and all other stock options shall terminate as of
the date the Executive's employment terminates.

(v) In the event the Executive's employment with
BridgeStreet terminates because of his death, all of the stock
options shall become exercisable.

(d) OTHER BENEFITS. During the term hereof, the Executive
shall be entitled to receive medical insurance coverage and to
participate in any and all employee benefit plans from time to time in
effect for employees of BridgeStreet generally, except to the extent
such plans are in a category of benefit (including without limitation
bonus compensation) otherwise provided to the Executive. Such
participation shall be subject to (i) the terms of the applicable plan
documents, (ii) generally applicable BridgeStreet policies and (iii) the
discretion of the Board or any administrative or other committee
provided for in or contemplated by such plan. BridgeStreet may alter,
modify, add to or delete its employee benefit plans at any time as it,
in its sole judgment, determines to be appropriate, without recourse by
the Executive.

(e) BUSINESS EXPENSES. BridgeStreet shall pay or reimburse
the Executive for all reasonable and necessary business expenses
incurred or paid by the Executive in the performance of his duties and
responsibilities hereunder, subject to any maximum annual limit and
other restrictions on such expenses set by the Board and to such
reasonable substantiation and documentation as may be specified by
BridgeStreet from time to time.

(f) RELOCATION EXPENSES. BridgeStreet shall pay or reimburse
the executive for all reasonable and necessary expenses incurred or paid
by the Executive in relocating his principal residence from Andover,
Massachusetts, to Hudson, Ohio, and described on Exhibit C attached
hereto, subject to such reasonable substantiation and documentation as
may be specified by BridgeStreet from time to time.

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<PAGE> 4

(g) VACATION. The Executive shall be entitled to four fully
paid weeks of vacation each year to be taken at such times as shall not
unreasonably interfere with the Executive's employment obligations and
responsibilities and BridgeStreet's reasonable requirements. The
Executive's rights to vacations shall not cumulate from year to year.

5. TERMINATION OF EMPLOYMENT. Notwithstanding the provisions of
Section 2 hereof, the Executive's employment hereunder shall terminate prior to
the expiration of the term under the following circumstances:

(a) DEATH. In the event of the Executive's death during the
term hereof, the Executive's employment hereunder shall immediately and
automatically terminate. In that event, BridgeStreet shall pay to the
Executive's designated beneficiary or, if no beneficiary has been
designated by the Executive, to his estate, any earned and unpaid Base
Salary, prorated through the date of his death.

(b) DISABILITY.

(i) BridgeStreet may terminate the Executive's
employment hereunder, upon notice to the Executive, in the event
that the Executive becomes disabled through any illness, injury,
accident or condition of either a physical or psychological
nature and, as a result, is unable to perform substantially all
of his duties and responsibilities hereunder for ninety (90)
consecutive days or for an aggregate of one hundred eighty (180)
days during any period of three hundred sixty-five (365)
consecutive calendar days.

(ii) The Board may designate another executive to act
in the Executive's place during any period of the Executive's
disability. Notwithstanding any such designation, the Executive
shall continue to receive the Base Salary in accordance with
Section 4(a) and benefits in accordance with Section 4(d), to
the extent permitted by the then-current terms of the applicable
benefit plans, until the Executive becomes eligible for
disability income benefits under any disability income plan (if
one is provided by BridgeStreet) or until the termination of his
employment, whichever shall first occur.

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<PAGE> 5

plans in accordance with Section 4(d) and the terms of such
plans, to the extent permitted by such plans, until the
termination of his employment.

(iv) If any question shall arise as to whether during
any period the Executive is disabled through any illness,
injury, accident or condition of either a physical or
psychological nature so as to be unable to perform substantially
all of his duties and responsibilities hereunder, the Executive
may, and at the request of BridgeStreet shall, submit to a
medical examination by a physician selected by BridgeStreet to
whom the Executive or his duly appointed guardian, if any, has
no reasonable objection to determine whether the Executive is so
disabled and such determination shall for the purposes of this
Agreement be conclusive of the issue. If such question shall
arise and the Executive shall fail to submit to such medical
examination, BridgeStreet's determination of the issue shall be
binding on the Executive.

(c) BY BRIDGESTREET FOR CAUSE. BridgeStreet may terminate the
Executive's employment hereunder for Cause at any time upon notice to the
Executive setting forth in reasonable detail the nature of such Cause. The
following, as determined by the Board in its reasonable judgment, shall
constitute Cause for termination:

(i) The Executive's repeated failure to perform (other than
by reason of disability), or gross negligence in the performance
of, his material duties and responsibilities hereunder and the
continuance of such failure or negligence for a period of thirty
(30) days after notice to the Executive;

(ii) Material breach by the Executive of any provision of
this Agreement or any other written agreement between the
Executive and BridgeStreet or any of its Affiliates;

(iii) Other conduct by the Executive that involves a material
violation of law or breach of fiduciary obligation on the part
of the Executive or is otherwise materially harmful to the
business, interests, reputation or prospects of BridgeStreet or
any of its Affiliates.

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<PAGE> 6

Upon the giving of notice of termination of the Executive's employment
hereunder for Cause, BridgeStreet shall not have any further obligation or
liability to the Executive, other than for Base Salary earned and unpaid at the
date of termination and except as provided below:

(A) BridgeStreet shall continue to pay to the
Executive his Base Salary as of the date of termination for a
period of three months.

(B) BridgeStreet shall pay to the Executive a pro
rata portion of his bonus, if any, contemplated by Section 4(b)
for the calendar year in which his employment was terminated
based upon the number of days in the year elapsed prior to
termination.

(C) BridgeStreet shall continue to provide Executive
with the medical insurance coverage contemplated by Section 4(d)
for a period of six months.

(d) CHANGE OF CONTROL. The Executive may terminate his
employment hereunder at any time during the three-month period beginning three
months after a Change of Control has occurred by written notice given to
BridgeStreet. In the event of such termination:

(i) BridgeStreet shall continue to pay to the
Executive his Base Salary as of the date of the Change of
Control for twelve months from the date of termination.

(ii) BridgeStreet shall pay to the Executive a pro
rata portion of his bonus, if any, contemplated by Section 4(b)
for the calendar year in which his employment terminated based
upon the number of days in the year elapsed prior to
termination.

(iii) BridgeStreet shall continue to provide Executive
with the medical insurance coverage contemplated by Section 4(d)
for twelve months from the date of termination.

6. EFFECT OF TERMINATION. The provisions of this Section 6 shall
apply to termination due to the expiration of the term, pursuant to Section 5 or
otherwise, except as otherwise provided in Section 5.

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<PAGE> 7

(a) Except as otherwise provided in paragraph (d), payment
by BridgeStreet of any Base Salary and contributions to the cost of the
Executive's continued participation in BridgeStreet's group health and
dental plans, if any, that are due the Executive in each case under the
applicable termination provision of Section 5 shall constitute the
entire obligation of BridgeStreet to the Executive.

(b) Except as otherwise provided in paragraph (d), benefits
shall terminate pursuant to the terms of the applicable benefit plans
based on the date of termination of the Executive's employment without
regard to any continuation of Base Salary or other payment to the
Executive following such date of termination.

(c) Except as otherwise provided in paragraph (d),
provisions of this Agreement shall survive any termination if so
provided herein or if necessary or desirable fully to accomplish the
purposes of such provisions, including without limitation the
obligations of the Executive under Sections 7 and 8 hereof. The
Executive recognizes that no compensation is earned after termination of
employment except as provided in paragraph (d).

(d) In the event the Executive's employment by BridgeStreet
is terminated by BridgeStreet notwithstanding the terms of this
Agreement:

(i) BridgeStreet shall continue to pay to the
Executive his Base Salary as of the date of termination for the
term of this Agreement or twelve months, whichever is longer.

(ii) BridgeStreet shall pay to the Executive a pro
rata portion of his bonus, if any, contemplated by Section 4(b)
for the calendar year in which his employment was terminated
based upon the number of days in the year elapsed prior to
termination.

(iii) BridgeStreet shall continue to provide Executive
with the medical insurance coverage contemplated by Section 4(d)
for the term of this Agreement or twelve months, whichever is
longer.

7. CONFIDENTIAL INFORMATION.

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<PAGE> 8

will not, directly or indirectly, use or disclose any Confidential
Information, as defined below. The Executive understands and agrees that
this restriction will continue to apply after his employment terminates,
regardless of the reason for termination.

(b) The Executive agrees that all Confidential Information
which he creates or to which he has access as a result of his employment
or the rendering of other services to BridgeStreet is and shall remain
the sole and exclusive property of BridgeStreet. Except as required for
the proper performance of his duties, the Executive will not copy any
documents, tapes or other media containing Confidential Information
("Documents") or remove any Documents, or copies, from BridgeStreet's
premises. The Executive will return to BridgeStreet immediately after
his employment terminates, and at such other times as may be specified
by BridgeStreet, all Documents and copies and all other property of
BridgeStreet then in his possession or control.

8. RESTRICTED ACTIVITIES. The Executive agrees that some
restrictions on his activities during and after his employment are necessary to
protect the goodwill, Confidential Information and other legitimate interests of
BridgeStreet and its Affiliates:

(a) The Executive agrees that, during the term hereof and
for a period of two (2) years immediately following termination of his
employment (the "Non-Competition Period"), he will not, directly or
indirectly, whether as an owner, partner, investor, consultant, employee
or otherwise, provide services to or engage in, or undertake any
planning to engage in, any type of business or enterprise in any way
similar to or competitive with BridgeStreet or any of its Affiliates.

(b) The Executive agrees that, during the term hereof, he
will not undertake any outside activity, whether or not competitive with
the business of BridgeStreet or any of its Affiliates, that could
reasonably give rise to a conflict of interest or otherwise interfere
with his duties and obligations to BridgeStreet or any of its
Affiliates.

-8-

<PAGE> 9

prospective customer conducts or could conduct with BridgeStreet or any of
its Affiliates, or (iv) call upon any prospective acquisition candidates
on the Executive's own behalf or on behalf of any third party, which
candidate was either called upon by the Executive or for which the
Executive made or had access to an acquisition analysis for BridgeStreet.

9. NOTIFICATION REQUIREMENT. Until four (4) weeks after the
conclusion of the Non-Competition Period, the Executive shall give notice to
BridgeStreet of each new business activity he plans to undertake, at least
ninety (90) days prior to beginning any such activity. Such notice shall state
the name and address of the Person for whom such activity is undertaken and the
nature of the Executive's business relationship(s) and position(s) with such
Person. The Executive shall provide BridgeStreet with such other pertinent
information concerning such business activity as BridgeStreet may reasonably
request in order to determine the Executive's continued compliance with his
obligations under Sections 7 and 8 hereof.

10. ENFORCEMENT OF COVENANTS. The Executive acknowledges that he has
carefully read and considered all the terms and conditions of this Agreement,
including the restraints imposed upon him pursuant to Sections 7 and 8 hereof.
The Executive agrees that said restraints are necessary for the reasonable and
proper protection of BridgeStreet and its Affiliates and that each and every one
of the restraints is reasonable in respect to subject matter, length of time and
geographic area. The Executive further agrees that all goodwill of BridgeStreet
and its Affiliates is their exclusive property. The Executive further
acknowledges and agrees that, were he to breach any of the covenants contained
in Sections 7 or 8 hereof, the damage would be irreparable. The Executive
therefore agrees that BridgeStreet or any of its Affiliates, as the case may be,
in addition to any other remedies available to it, shall be entitled to
preliminary and permanent injunctive relief against any breach or threatened
breach by the Executive of any of said covenants, without having to post bond.
The parties further agree that, in the event that any provision of Sections 7 or
8 hereof shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its being extended over too great a time, too large a
geographic area or too great a range of activities, such provision shall be
deemed to be modified to permit its enforcement to the maximum extent permitted
by law.

11. CONFLICTING AGREEMENTS. The Executive hereby represents and
warrants that the execution of this Agreement and the performance of his
obligations hereunder will not breach or be in conflict with any other agreement
to which the Executive is a party or is bound and that the Executive is not
subject to any covenants against competition or similar covenants that would
affect the performance of his obligations hereunder. The Executive will not
disclose to or use any proprietary information of a third party without such
party's consent.

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<PAGE> 10

12. DEFINITIONS. Words or phrases which are initially capitalized or
are within quotation marks shall have the meanings provided in this Section 12
and as provided elsewhere herein. For purposes of this Agreement, the following
definitions apply:

(a) "Affiliates" means all persons and entities directly or
indirectly controlling, controlled by or under common control with
BridgeStreet, where control may be by either management authority or
equity interest.

(b) "Confidential Information" means any and all information
of BridgeStreet or of its Affiliates that is not generally known by
others with whom BridgeStreet or any of its Affiliates does, or plans
to, compete or do business, including but not limited to (i)
BridgeStreet's or any of its Affiliates' products and services,
technical data, methods and processes, (ii) BridgeStreet's or any of its
Affiliates' marketing activities and strategic plans, (iii)
BridgeStreet's or any of its Affiliates' costs and sources of supply,
(iv) the identity and special needs of BridgeStreet's or any of its
Affiliates' customers and prospective customers, vendors and prospective
vendors, and acquisition candidates and (v) the people and organizations
with whom BridgeStreet or any of its Affiliates has business
relationships and those relationships. Confidential Information also
includes such information that BridgeStreet or any of its Affiliates may
receive or has received belonging to customers or others who do business
with BridgeStreet or any of its Affiliates.

(c) "Person" means an individual, a corporation, an
association, a partnership, an estate, a trust and any other entity or
organization, other than BridgeStreet or any of its Affiliates.

13. WITHHOLDING. All payments made under this Agreement shall be
reduced by any tax or other amounts required to be withheld under applicable
law.

14. ASSIGNMENT. Neither BridgeStreet nor the Executive may make any
assignment of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other; provided, however,
that BridgeStreet may assign its rights and obligations under this Agreement
without the consent of the Executive in the event that BridgeStreet shall
hereafter effect a reorganization, consolidate with, or merge into, any other
Person or transfer all or substantially all of its properties or assets to any
other Person. This Agreement shall inure to the benefit of and be binding upon
BridgeStreet and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.

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<PAGE> 11

15. SEVERABILITY. If any portion or provision of this Agreement
shall to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

16. WAIVER. No waiver of any provision hereof shall be effective
unless made in writing and signed by the waiving party. The failure of either
party to require the performance of any term or obligation of this Agreement, or
the waiver by either party of any breach of this Agreement, shall not prevent
any subsequent enforcement of such term or obligation or be deemed a waiver of
any subsequent breach.

17. NOTICES. Any and all notices, requests, demands and other
communications provided for by this Agreement shall be in writing and shall be
effective when delivered in person or deposited in the United States mail,
postage prepaid, registered or certified, and addressed to the Executive at his
last known address on the books of BridgeStreet or, in the case of BridgeStreet,
at BridgeStreet's principal place of business, attention of Chairman of the
Board, or to such other address as either party may specify by notice to the
other actually received.

18. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties and supersedes all prior communications,
agreements and understandings, written or oral, with respect to the terms and
conditions of the Executive's employment.

19. AMENDMENT. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by an expressly authorized
representative of BridgeStreet.

20. HEADINGS. The headings and captions in this Agreement are for
convenience only and in no way define or describe the scope or content of any
provision of this Agreement.

21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.

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<PAGE> 12

purposes of any suit, action, or other proceeding arising out of this Agreement
and to the subject matter of the same, and hereby waives, and agrees not to
assert, as a defense in any such suit, action, or proceeding that he or it is
not subject to such jurisdiction, or that such suit, action or proceeding may
not be brought or is not maintainable in such courts, or that any suit, action,
or proceeding brought in any other court is not transferable to any such Ohio
court.

IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Executive and BridgeStreet, by its duly authorized
representative, as of the date first above written.

EXECUTIVE: BRIDGESTREET INTERNATIONAL INC.

/s/ Mark D. Gagne By: /s/ Paul M. Verrochi
- ------------------------- --------------------------------------
Mark D. Gagne Name: Paul M. Verrochi
Title: Chairman of the Board

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<PAGE> 13

EXHIBIT A

BRIDGESTREET ACCOMMODATIONS
BONUS COMPENSATION PROGRAM

OBJECTIVE: To create a bonus compensation program which drives the
management team of BridgeStreet to build shareholder value
through stock price appreciation. An effective bonus program
should focus the management team to balance near term
profitability with long term sales growth and new market
expansion strategies.

Important variables to consider:
I. ACHIEVING QUARTERLY EARNINGS ESTIMATES
- - Reduces stock price volatility
- - Builds credibility in the investment community/enhances stock price
- - Positively impacts stock purchase component of acquisitions (i.e.,
higher stock price reduces the number of shares issued upon acquisition)

II. ACCRETIVE ACQUISITIONS OF COMPANIES IN NEW AND EXISTING MARKETS
- - Positions the Company for long term growth in sales and profitability
- - Promotes regional cross sell capabilities
- - Positions BridgeStreet as a national company

III. STOCK PRICE APPRECIATION
- - Stockholder's yardstick for measuring success

As follows is a draft bonus compensation program for the management team of
BridgeStreet (percentages represent percent of total budgeted bonus $ amount):

<TABLE>
<CAPTION>
BONUS CRITERIA BONUS % PAYMENT
-------------- ------- -------

<S> <C> <C>
Achieve qrterly earnings estimates (1st qtr) 12.5% Annually
Achieve qrterly earnings estimates (2nd qtr) 12.5% Annually
Achieve qrterly earnings estimates (3rd qtr) 12.5% Annually
Achieve qrterly earnings estimates (4th qtr) 12.5% Annually
----
50.0%

</TABLE>

To receive all or part of the annual bonus related to achieving quarterly
earnings estimates, the annual earnings estimate must be achieved. If the annual
earnings estimate is met, management will be bonused based upon each quarterly
earnings estimate that is met.

ANNUAL STOCK PRICE APPRECIATION

<S> <C> <C> <C>
[BIGER]20% 30.0% Annually
[BIGER]15% 20.0% Annually
[BIGER]10% 10.0% Annually

DISCRETIONARY BASED UPON OTHER OBJECTIVE 20.0% Annually
Examples would be: acquisitions, geographic
expansion, implementation of best practices,
installation of information systems, etc.
</TABLE>

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<PAGE> 14

EXHIBIT B

"Change in Control" means the occurrence of any of the following events:
(a) BridgeStreet is a party to, or the stockholders approve, a merger,
consolidation or reorganization with another corporation (other than a merger,
consolidation or reorganization that would result in the voting power of the
securities outstanding immediately before such merger, consolidation or
reorganization to continue to represent (either by virtue of such securities
remaining outstanding or being converted into securities of the surviving
entity) more than 50% of the voting power immediately following such merger,
consolidation or reorganization); (b) a sale of all, or substantially all, of
the assets of BridgeStreet; (c) any individual, partnership, firm, corporation,
association, trust, unincorporated organization or other entity, or any
syndicate or group deemed to be a person under Section 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), becomes the
"beneficial owner" (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of shares of Common Stock representing 51% or more of the voting
power of BridgeStreet's then outstanding securities entitled to vote in the
election of directors of BridgeStreet; (d) during any period of two consecutive
years, individuals who at the beginning of such period constituted the Board,
and any new directors whose election by the Board or nomination for election by
BridgeStreet's stockholders was approved by a vote of at least three-quarters of
the directors then still in office who either were directors at the beginning of
the period or whose selection or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof; or (e)
BridgeStreet is dissolved or liquidated; provided, however, that a change in
control under clause (a), (b), (c) or (e) shall not be deemed to be a Change in
Control as a result of an acquisition of securities of BridgeStreet (or, in the
case of clause (e), assets of BridgeStreet or securities of a successor to
BridgeStreet) by an employee benefit plan maintained by BridgeStreet (or, in the
case of clause (e), a successor) for its employees.

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<PAGE> 15

EXHIBIT C

MARK D. GAGNE
EMPLOYMENT AGREEMENT WITH BRIDGESTREET INTERNATIONAL INC.
MOVING EXPENSES ADDENDUM

BridgeStreet International Inc. ("BridgeStreet") will reimburse Mark D. Gagne
("Gagne") for the following moving expenses in conjunction with his employment
as Chief Financial Officer of BridgeStreet and relocation to Cleveland:

HOME-SALE ASSISTANCE EXPENSES TO INCLUDE:

- - Real estate brokers commission for Gagne home at One Sheffield Circle,
Andover, MA.
- - Closing costs to include all expenses incurred for the sale of Gagne
home at One Sheffield Circle, Andover, MA.
- - Third party home buyout of Gagne home at One Sheffield Circle, Andover,
MA (if necessary) valued at the average of two appraisals.

HOME-BUYING ASSISTANCE EXPENSES TO INCLUDE:

- - House hunting trips/expenses including lodging, meals, baby-sitting,
laundry, telephone, transportation, etc. for Gagne and his family.
- - Home-buying expenses including legal fees, loan application fees, loan
origination fees, state transfer taxes, home inspection fees,
pre-purchase property appraisal, escrow fees, radon-testing and any
other actual expenses incurred in conjunction with the purchase of a new
home.

RELOCATION EXPENSES TO INCLUDE:

- - Family relocation expenses for air travel, rental car, hotel or motel
and meals
- - Transportation of household goods - pickup and delivery, packing and
unpacking
- - Transportation of automobiles
- - Any miscellaneous expenses incurred as a result of Gagne's move to
Cleveland.

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<PAGE> 1
Exhibit 10.13

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made and entered into effective as of March 31, 1997
by and between BridgeStreet International Inc, a Delaware corporation
("BridgeStreet"), and William N. Hulett III, of Chagrin Falls, Ohio (the
"Executive").

In consideration of the mutual promises, terms, provisions and
conditions set forth in this Agreement, the parties hereby agree as follows:

1. EMPLOYMENT. Subject to the terms and conditions set forth in
this Agreement, BridgeStreet hereby offers and the Executive hereby accepts
employment.

2. TERM. Subject to earlier termination as hereafter provided, the
Executive's employment hereunder shall be for a term beginning June 1, 1997 and
ending May 31, 2000. The term of this Agreement, as from time to time extended
or renewed, is hereafter referred to as "the term of this Agreement" or "the
term hereof."

3. CAPACITY AND PERFORMANCE.

(a) During the term hereof, the Executive shall serve as the
Chief Executive Officer and President of BridgeStreet. In addition, and
without further compensation, the Executive shall serve as a director
and/or officer of BridgeStreet and/or one or more of BridgeStreet's
Affiliates if so elected or appointed from time to time.

(b) During the term hereof, the Executive shall be employed
by BridgeStreet on a full-time basis. The Executive shall have all
powers and duties consistent with his position, subject to the direction
and control of BridgeStreet's Board of Directors (the "Board"), and
shall perform such other duties and responsibilities on behalf of
BridgeStreet and its Affiliates as may reasonably be designated from
time to time by the Board or by its designees.

<PAGE> 2

(a) BASE SALARY. During the term hereof, BridgeStreet shall
pay the Executive a base salary as hereinafter provided, payable in
accordance with the payroll practices of BridgeStreet for its executives
and subject to increase from time to time by the Board or a compensation
committee of the Board, in its sole discretion. Such base salary, as
from time to time increased, is hereafter referred to as the "Base
Salary".

PERIOD BASE SALARY (ANNUAL RATE)

<S> <C> <C>
June 1, 1997 - December 31, 1997 - $200,000

January 1, 1998 - December 31, 1998 - $200,000 plus an additional
$25,000 if BridgeStreet has
achieved the net earnings per share
set forth in the budget adopted by
the Board for the period June 1,
1997 through December 31, 1997

January 1, 1999 - December 31, 1998 - The Base Salary for 1998 plus an
additional $25,000 if BridgeStreet
has achieved the net earnings
per share set forth in the budget
adopted by the Board for calendar
1998

January 1, 2000 - May 31, 2000 - The Base Salary for 1999 plus an
additional $25,000 if BridgeStreet
has achieved the net earnings per
share set forth in the budget
adopted by the Board for calendar
1999

</TABLE>

(b) BONUS COMPENSATION. The Executive shall be entitled to
participate in the bonus plan described on Exhibit A attached hereto
which will entitle him to receive up to a maximum of fifty percent (50%)
of his Base Salary. Unless the Compensation Committee of the Board
otherwise decides and except as provided in Section 6(d), the Executive
shall receive his bonus for a year only if he is employed by
BridgeStreet on the last day of such year.

-2-

<PAGE> 3

(c) STOCK OPTIONS. Effective as of the pricing date of
BridgeStreet's initial public offering (the "IPO"), and subject to the
closing thereof, the Executive shall be granted stock options to
purchase 150,000 shares of Common Stock of BridgeStreet at a price per
share equal to the IPO price per share of BridgeStreet Common Stock.
Such stock options shall be granted pursuant to, and shall be subject to
the terms and conditions of, BridgeStreet's employee stock option plan
or other equity incentive plan then in effect and the policies of the
Board then in effect with regard to the grant of stock options and the
terms hereof, but shall in all events provide as follows:

(i) The term of the stock options shall be for ten
years (subject to earlier termination as set forth in the plan
for merger and similar transactions).

(iv) All stock options exercisable by the Executive
on the date his employment with BridgeStreet terminates shall
remain exercisable for a period of one year from the date of
termination unless such termination is by BridgeStreet
notwithstanding the terms of this Agreement, in which event all
of the stock options shall become exercisable effective on the
date of such termination and shall remain exercisable for the
balance of the ten-year term of the stock options. Following
expiration of the term hereof (or of the term of any successor
to this Agreement), (A) if the Executive advises BridgeStreet in
writing that he is willing to continue his employment with
BridgeStreet and BridgeStreet does not offer the Executive
continued employment by BridgeStreet on financial terms no less
favorable to the Executive than those set forth in this
Agreement or (B) if BridgeStreet elects not to continue the
Executive's employment for any reason other than a disability
which would have entitled BridgeStreet to terminate this
Agreement pursuant to Section 5(b) or conduct of the Executive
which would have constituted Cause under Section 5(b), all of
the stock options shall remain exercisable for the balance of
the ten-year term of the stock options; otherwise, all stock
options shall remain exercisable for a period of one year from
the date the Executive's employment with BridgeStreet
terminates.

-3-

<PAGE> 4

(d) OTHER BENEFITS. During the term hereof and subject to
any contribution therefor generally required of employees of
BridgeStreet, the Executive shall be entitled to receive long-term
disability and medical insurance coverage and to participate in any and
all employee benefit plans from time to time in effect for employees of
BridgeStreet generally, except to the extent such plans are in a
category of benefit (including without limitation bonus compensation)
otherwise provided to the Executive. Such participation shall be subject
to (i) the terms of the applicable plan documents, (ii) generally
applicable BridgeStreet policies and (iii) the discretion of the Board
or any administrative or other committee provided for in or contemplated
by such plan. BridgeStreet may alter, modify, add to or delete its
employee benefit plans at any time as it, in its sole judgment,
determines to be appropriate, without recourse by the Executive.

(B) DISABILITY.

(i) BridgeStreet may terminate the
Executive's employment hereunder, upon notice to the
Executive, in the event that the Executive becomes
disabled through any illness, injury, accident or
condition of either a physical or psychological nature
and, as a result, is unable to perform substantially all
of his duties and responsibilities hereunder for ninety
(90) consecutive days or for an aggregate of one hundred
eighty (180) days during any period of three hundred
sixty-five (365) consecutive calendar days.

-4-

<PAGE> 5

(ii) The Board may designate another
executive to act in the Executive's place during any
period of the Executive's disability. Notwithstanding
any such designation, the Executive shall continue to
receive the Base Salary in accordance with Section 4(a)
and benefits in accordance with Section 4(d), to the
extent permitted by the then-current terms of the
applicable benefit plans, until the Executive becomes
eligible for disability income benefits under any
disability income plan (if one is provided by
BridgeStreet) or until the termination of his
employment, whichever shall first occur.

(iii) While receiving disability income
payments under BridgeStreet's disability income plan, if
any, the Executive shall not be entitled to receive any
Base Salary under Section 4(a) hereof, but shall
continue to participate in BridgeStreet benefit plans in
accordance with Section 4(d) and the terms of such
plans, to the extent permitted by such plans, until the
termination of his employment.

(iv) If any question shall arise as to
whether during any period the Executive is disabled
through any illness, injury, accident or condition of
either a physical or psychological nature so as to be
unable to perform substantially all of his duties and
responsibilities hereunder, the Executive may, and at
the request of BridgeStreet shall, submit to a medical
examination by a physician selected by BridgeStreet to
whom the Executive or his duly appointed guardian, if
any, has no reasonable objection to determine whether
the Executive is so disabled and such determination
shall for the purposes of this Agreement be conclusive
of the issue. If such question shall arise and the
Executive shall fail to submit to such medical
examination, BridgeStreet's determination of the issue
shall be binding on the Executive.

(c) BY BRIDGESTREET FOR CAUSE. BridgeStreet may terminate
the Executive's employment hereunder for Cause at any time upon notice
to the Executive setting forth in reasonable detail the nature of such
Cause. The following, as determined by the Board in its reasonable
judgment, shall constitute Cause for termination:

-5-

<PAGE> 6

(i) The Executive's repeated failure to perform
(other than by reason of disability), or gross negligence in the
performance of, his material duties and responsibilities
hereunder and the continuance of such failure or negligence for
a period of thirty (30) days after notice to the Executive;

(ii) Material breach by the Executive of any
provision of this Agreement or any other written agreement
between the Executive and BridgeStreet or any of its Affiliates;

(iii) Other conduct by the Executive that involves a
material violation of law or breach of fiduciary obligation on
the part of the Executive or is otherwise materially harmful to
the business, interests, reputation or prospects of BridgeStreet
or any of its Affiliates.

Upon the giving of notice of termination of the Executive's
employment hereunder for Cause, BridgeStreet shall not have any further
obligation or liability to the Executive, other than for Base Salary
earned and unpaid at the date of termination.

6. EFFECT OF TERMINATION. The provisions of this Section 6 shall
apply to termination due to the expiration of the term, pursuant to Section 5 or
otherwise.

-6-

<PAGE> 7

(d) In the event the Executive's employment by BridgeStreet
is terminated by BridgeStreet notwithstanding the terms of this
Agreement:

(i) BridgeStreet shall continue to pay to the
Executive his Base Salary as of the date of termination for the
term of this Agreement or twelve months, whichever is longer.

(iii) BridgeStreet shall continue to provide Executive
with the medical insurance coverage contemplated by Section 4(d)
for the term of this Agreement or twelve months, whichever is
longer.

7. CONFIDENTIAL INFORMATION.

(a) The Executive acknowledges that BridgeStreet and its
Affiliates will continually develop Confidential Information, that the
Executive may develop Confidential Information for BridgeStreet or its
Affiliates and that the Executive may learn of Confidential Information.
The Executive agrees that, except as required for the proper performance
of his duties for BridgeStreet, he will not, directly or indirectly, use
or disclose any Confidential Information, as defined below. The
Executive understands and agrees that this restriction will continue to
apply after his employment terminates, regardless of the reason for
termination.

-7-

<PAGE> 8

(a) The Executive agrees that, during the term hereof and
for a period of two (2) years immediately following termination of his
employment (the "Non-Competition Period"), he will not, directly or
indirectly, whether as an owner, partner, investor, consultant, employee
or otherwise, provide services to or engage in, or undertake any
planning to engage in, any business engaged in the extended stay
lodgings business without the prior written consent of BridgeStreet, it
being understood that hotels, as such, are not included within such
prohibition.

(c) The Executive further agrees that during the term hereof
and during the Non-Competition Period, the Executive will not, and will
not assist anyone else to, (i) hire any employee of BridgeStreet or any
of its Affiliates or seek to persuade any employee of BridgeStreet or
any of its Affiliates to discontinue employment, (ii) solicit or
encourage any customer or vendor of or lessor to BridgeStreet or any of
its Affiliates to terminate or diminish its relationship with
BridgeStreet or any of its Affiliates, (iii) seek to persuade any
customer or prospective customer of BridgeStreet or any of its
Affiliates to conduct with anyone else any business or activity that
such customer or prospective customer conducts or could conduct with
BridgeStreet or any of its Affiliates, or (iv) call upon any prospective
acquisition candidates on the Executive's own behalf or on behalf of any
third party, which candidate was either called upon by the Executive or
for which the Executive made or had access to an acquisition analysis
for BridgeStreet.

-8-

<PAGE> 9

area. The Executive further agrees that all goodwill of BridgeStreet and its
Affiliates is their exclusive property. The Executive further acknowledges and
agrees that, were he to breach any of the covenants contained in Sections 7 or 8
hereof, the damage would be irreparable. The Executive therefore agrees that
BridgeStreet or any of its Affiliates, as the case may be, in addition to any
other remedies available to it, shall be entitled to preliminary and permanent
injunctive relief against any breach or threatened breach by the Executive of
any of said covenants, without having to post bond. The parties further agree
that, in the event that any provision of Sections 7 or 8 hereof shall be
determined by any court of competent jurisdiction to be unenforceable by reason
of its being extended over too great a time, too large a geographic area or too
great a range of activities, such provision shall be deemed to be modified to
permit its enforcement to the maximum extent permitted by law.

(b) "Confidential Information" means any and all information
of BridgeStreet or of its Affiliates that is not generally known by
others with whom BridgeStreet or any of its Affiliates does, or plans
to, compete or do business, including but not limited to (i)
BridgeStreet's or any of its Affiliates' products and services,
technical data, methods and processes, (ii) BridgeStreet's or any of its
Affiliates' marketing activities and strategic plans, (iii)
BridgeStreet's or any of its Affiliates' costs and sources of supply,
(iv) the identity and special needs of BridgeStreet's or any of its
Affiliates' customers and prospective customers, vendors and
prospective vendors, and acquisition candidates and (v) the people and
organizations with whom BridgeStreet or any of its Affiliates has
business relationships and those relationships. Confidential Information
also includes such information that BridgeStreet or any of its
Affiliates may receive or has received belonging to customers or others
who do business with BridgeStreet or any of its Affiliates.

-9-

<PAGE> 10

(c) "Person" means an individual, a corporation, an
association, a partnership, an estate, a trust and any other entity or
organization, other than BridgeStreet or any of its Affiliates.

13. WITHHOLDING. All payments made under this Agreement shall be
reduced by any tax or other amounts required to be withheld under applicable
law.

-10-

<PAGE> 11

19. AMENDMENT. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by an expressly authorized
representative of BridgeStreet.

20. HEADINGS. The headings and captions in this Agreement are for
convenience only and in no way define or describe the scope or content of any
provision of this Agreement.

21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.

22. GOVERNING LAW. This Agreement shall be construed and enforced
under and be governed in all respects by the laws of the State of Ohio, without
regard to the conflict of laws principles thereof. Each party hereby agrees to
submit himself or itself to the jurisdiction of the Common Pleas Court of the
State of Ohio and to the jurisdiction of the United States District Court for
the Northern District of Ohio, for purposes of any suit, action, or other
proceeding arising out of this Agreement and to the subject matter of the same,
and hereby waives, and agrees not to assert, as a defense in any such suit,
action, or proceeding that he or it is not subject to such jurisdiction, or that
such suit, action or proceeding may not be brought or is not maintainable in
such courts, or that any suit, action, or proceeding brought in any other court
is not transferable to any such Ohio court.

IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Executive and BridgeStreet, by its duly authorized
representative, as of the date first above written.

EXECUTIVE: BRIDGESTREET INTERNATIONAL INC.

/s/ William N. Hulett, III By: /s/ Paul M. Verrochi
- ------------------------------ ----------------------------------
William N. Hulett III Name: Paul M. Verrochi
Title: Chairman of the Board

-11-

<PAGE> 12

EXHIBIT A

BRIDGESTREET ACCOMMODATIONS
BONUS COMPENSATION PROGRAM

Important variables to consider:

I. ACHIEVING QUARTERLY EARNINGS ESTIMATES
- - Reduces stock price volatility
- - Builds credibility in the investment community/enhances stock price
- - Positively impacts stock purchase component of acquisitions (i.e.,
higher stock price reduces the number of shares issued upon acquisition)

III. STOCK PRICE APPRECIATION
- - Stockholder's yardstick for measuring success

As follows is a draft bonus compensation program for the management team of
BridgeStreet (percentages represent percent of total budgeted bonus $ amount):

<TABLE>
<CAPTION>
BONUS CRITERIA BONUS % PAYMENT
-------------- ------- -------

</TABLE>

<TABLE>
<CAPTION>
ANNUAL STOCK PRICE APPRECIATION

<S> <C> <C> <C>
[GREATER THAN]20% 30.0% Annually
[GREATER THAN]15% 20.0% Annually
[GREATER THAN]10% 10.0% Annually

DISCRETIONARY BASED UPON OTHER OBJECTIVE 20.0% Annually
Examples would be: acquisitions, geographic
expansion, implementation of best practices,
installation of information systems, etc.
</TABLE>

-12-

<PAGE> 13

EXHIBIT B

-13-

<PAGE> 1
Exhibit 10.16

SATURN'S RENTAL AGREEMENT

By and Between:
Saturn Enterprises Inc.,
1515 Bethel Rd.
Columbus, Ohio 43220

and

Temporary Corporate Housing Inc.,
1515 Bethel Rd.
Columbus, Ohio 43220

WHEREAS, Saturn Enterprises Inc., is a vendor whose primary business is the
short or long term rental needs of the various Temporary Corporate Housing Inc.
operations, in this case more specifically, television sets and microwave ovens
and VCRs, and new model combination TV-VCRs and,

WHEREAS, Temporary Corporate Housing Inc., doing business in Columbus,
Cleveland, Cincinnati, Ohio, and Pittsburgh, PA, wishes to rent this type of
equipment for the benefit of its temporary housing apartments in the cities
identified above, and

WHEREAS, Saturn Enterprises, Inc., through its owners, is willing to provide
this equipment on a rental basis, and is further willing to guarantee delivery
of said equipment to all designated areas maintained by local Temporary
Corporate Housing Inc. management as Saturn storage space. Said storage spaces
shall be rented by Saturn at a monthly charge of $125.00 (one hundred and twenty
five dollars). Said charges shall be deducted from monthly invoices provided to
Temporary Corporate Housing Inc., from Saturn Enterprises, Inc.

Now, therefore, beginning of the 1st day of January, 1996, and for the following
three consecutive years the undersigned officers of the respective corporations
do hereby enter into a rental agreement with rental rates per the following
schedule:

<PAGE> 2

RENTAL PERIOD TV TV/VCR MICRO

<S> <C> <C> <C>
1st Year- 1996 $.80/day $ .95/day $.60/day
2nd Year- 1997 $.85/day $1.10/day $.65/day
3rd Year- 1998 $.85/day $1.25/day $.65/day

</TABLE>

Note: All equipment with a manufacturing date prior to 1990 will be billed at
the 1995 rates until such time that they are replaced with new equipment.

In addition to the above schedule, which is to be implemented, on the first day
of January 1996, Saturn agrees that in an effort to assist new cities colonized
by Temporary Corporate Housing Inc., to establish an economically feasible base
that the first (30) Thirty apartment units fully equipped with Saturn inventory
in the next three TCH startup operations shall be charged only 30% (Thirty
percent) of the regularly scheduled rate. Commencing with the (31st) Thirty
first apartment unit all rates for Saturn Enterprises Inc. equipment in the
newly colonized operation shall be invoiced at the standard rates set forth in
the schedule above.

Lessor shall bill lessee $100.00 for each remote control device necessary to
replace those originally provided with each TV or TV/VCR combination unit.

Saturn Enterprises, Inc., shall prepare Temporary Corporate Housing Inc. monthly
billings so that they are available for the corporate offices before the 10th of
each month following the month being billed. The terms of payment shall be "Due
Upon Receipt" but payable within 30 days. Amounts remaining unpaid after 30 days
will accrue a late charge of 1% per month.

Saturn Enterprises, Inc., shall carry both property and liability insurance at
its sole cost and expense for the protection of it's equipment at all times, and
Temporary Corporate Housing, Inc., shall carry as part of their personal injury
liability insurance policy, protection for the benefit of TCH against any bodily
injury that might occur as a result of the use of Saturn Enterprises, Inc.
equipment by staff, employees, guests, and invitees of Temporary Corporate
Housing, Inc. and shall protect the value of the equipment at all times that it
is under custody of TCH.

Saturn Enterprises, Inc. shall be responsible for the repairs and maintenance of
all of it's equipment. Lessor can bill lessee for damages beyond normal wear and
tear.

Saturn Enterprises, Inc. shall, within the year 1996, implement a bar code
inventory control system to be used with all Saturn equipment.

-2-

<PAGE> 3

The term of this "RENTAL AGREEMENT" shall be in full force and effect for (3)
three years. Both parties shall have the option to renew the agreement for a
second three year term at rates to be determined at the time of renewal. Notice
of desire to renew shall be given 120 days prior to the termination of this
"RENTAL AGREEMENT."

If, any one or more of the provisions contained in this lease shall for any
reason be held invalid, illegal, or unenforceable in any respect, such
invalidity shall not affect any other provision hereof and this lease shall not
be construed as if such invalid, illegal, or unenforceable provision had ever
been contained herein.

The undersigned hereby, understand, agree to, and accept all terms and
conditions of this agreement, this 28th day of December 1995.

IN WITNESS WHEREOF, the parties hereto have executed this lease the day and year
first above written.

Lessor:
Saturn Enterprises, Inc.

/s/ Dave Clutchey III
- ---------------------------------
Dave Clutchey III

Lessee:

/s/ Max W. Holzer
- ---------------------------------
Temporary Corporate Housing, Inc.
Max W. Holzer, Chairman

ADDENDUMS;

Saturn Enterprises shall agree to furnish a vacancy credit for each city equal
to the vacancy of units during the months of December and January of each year.

Saturn Enterprises shall not charge TCH for any VCRs currently being utilized in
the TCH General Stores.

-3-

<PAGE> 1
Exhibit 10.17

EXCLUSIVE LEASE AGREEMENT

THIS CONTRACT made this 12th day of September, 1995 between INTEGRITY
FURNITURE, INC., hereinafter referred to as "INTEGRITY" and TEMPORARY CORPORATE
HOUSING PITTSBURGH, INC., hereinafter referred to as "TCH" and as guaranteed by
TEMPORARY CORPORATE HOUSING CLEVELAND, INC., TEMPORARY CORPORATE HOUSING
CINCINNATI, INC., AND TEMPORARY CORPORATE HOUSING COLUMBUS, INC., as follows:

1. TCH hereby grants to Integrity an exclusive contract to provide
all furnishings for all of the apartments operated by TCH in the following
Metropolitan areas:

Pittsburgh, PA

2. Integrity agrees to provide furniture packages to TCH for each
of the above described apartments.

3. Attached as Exhibit "A" are the specifications for the furniture
packages for one and two bedroom apartments to be supplied to TCH by Integrity
pursuant to the terms of this agreement.

4. Integrity shall be prepared to deliver and TCH shall be prepared
to accept furniture units upon the following schedule:

October 1995 - 35 Units
November 1995 - 35 Units
December 1995 - 35 Units
January 1996 - 15 Units
April 1996 - 15 Units
June 1996 - 10 Units

5. The lease term for a furniture package shall be a minimum of
three months. After the initial three month lease period, the lease shall
continue from month to month and may be terminated by TCH upon the giving of
five (5) days notice to Integrity.

6. During the first five years of this agreement, the following for
furniture packages shall be in effect:

<TABLE>
<CAPTION>
<S> <C>
One Bedroom Apartments $110.00 per month + tax
Two Bedroom Apartments $150.00 per month + tax

</TABLE>

7. After year five, Integrity may increase the price of said
furniture packages, however, in no event shall the monthly lease rate exceed a
sum equal to one-twelfth of the cost to Integrity of said furniture package.

<PAGE> 2

8. After the initial three month lease term for any single
furniture package, the lease rate for such furniture package shall be prorated
on a daily basis until such time as the furniture package is picked up by
Integrity.

9. By the 5th day of each month original invoices will be delivered
to the corresponding City. The invoices will reflect all activities and
prorations that occurred in the previous month.

10. Integrity shall send to TCH on a monthly basis an itemized
invoice detailing the monthly lease charge for each furniture package that is in
the possession of TCH for the previous month. Payment by TCH is due on a net
twenty (20) day basis. Any payments made thirty (30) days after the invoice date
shall be deemed late and Integrity may impose a one and one-half (1 1/2%)
percent late fee per month on any and all overdue lease payments.

11. Integrity at its sole expenses shall deliver within forty-eight
hours and pick up within five days all furniture packages leased pursuant to the
terms of this agreement. Integrity will deliver and pick up furniture packages
quicker depending on schedule availability also with no charge.

12. TCH assumes full responsibility for any and all damages that
occur to leased property owned by Integrity while in the possession of TCH.
Damages include but are not restricted to wind, water and fire damage, customer
negligence, cigarette burns, pet damage, or theft. TCH will provide Integrity
with an insurance binder with Integrity and Citizens National Bank of Evans
City, PA named payees in the loss payable clause. In exchange TCH will not be
charged any damage waiver fees.

13. Integrity shall in the case of product defect repair or replace
any articles that may be broken or damaged. Said service shall be performed by
Integrity within 48 hours of notification by TCH.

14. In the event that merchandise is damaged from misuse, while in
the possession of TCH, TCH is responsible to collect from their resident(s) the
amount required to cover the cost of any repair or replacement. If upon
termination of the lease damages are discovered, Integrity will inform TCH of
the problems and will provide a detailed listing of charges within 2 working
days.

15. TCH shall not, during the lease term, remove the furniture from
the premises to which it was delivered or permit the same to go out of its
possession except with the written consent of Integrity.

16. It shall be lawful for Integrity or its agents at all reasonable
times to enter the premises with forty eight hours notice to Temporary Corporate
Housing, Inc. where a furniture package is located for the purpose of viewing
the state of condition of said furniture.

-2-

<PAGE> 3

17. This Exclusive lease contract shall remain in effect for a
period of five (5) years from the date of first delivery of furniture and may be
renewed upon mutual consent of the parties. However, it is specifically agreed
and understood that TCH shall within twelve (12) months of the expiration of
this agreement provide notification to Integrity in writing as to TCH's
intention to renew the Exclusive Lease for an additional five year period. It is
understood and agreed that any such renewal shall be expected within six months
of the expiration of this agreement.

18. Integrity shall have the exclusive first option during the term
of this agreement to enter into contracts similar to this written contract with
TCH for its markets in Cleveland, Ohio, Columbus, Ohio, Cincinnati, Ohio, and
any other markets entered into by TCH. Said option shall become effective upon
the mutual agreement of the parties.

19. Upon termination of this agreement, whether by lapse of time or
otherwise, Integrity shall be at liberty to enter into the premises of TCH upon
five days notice and remove and carry away all furniture leased pursuant to this
agreement and to do all things reasonably necessary for such removal without
prejudice to rights of Integrity with respect to any lease payment due from TCH
under this agreement or for any damages or breach of contract by TCH.

20. No purchase option for leased furniture is implied or offered.

21. This document represents the entire agreement and understanding
of the parties and shall not be amended, changed or altered in any way except
upon written agreement of the parties.

22. This agreement is binding upon the parties, their agents,
principals, heirs, successors and assigns.

23. This contract shall be governed by the laws of the Commonwealth
of Pennsylvania.

WITNESS our hands and seals the day and year first above written.

ATTEST: INTEGRITY FURNITURE, INC.

BY
- ------------------------------ -----------------------------------

-3-

<PAGE> 4

ATTEST: TEMPORARY CORPORATE HOUSING,
PITTSBURGH, INC.

/s/ Kris L. Benjamin BY /s/ Lynda D. Clutchey
- ------------------------------ ----------------------------------
Kris L. Benjamin Lynda D. Clutchey
Treasurer Vice President/Secretary

In consideration of the execution of the Exclusive Lease Agreement
between Integrity Furniture, Inc. and Temporary Corporate Housing Pittsburgh,
Inc., the undersigned corporations do hereby guarantee to Integrity Furniture,
Inc., its successors and assigns, to perform all obligations and make all
payments of Temporary Corporate Housing Pittsburgh, Inc. as set forth in said
Exclusive Lease Agreement.

ATTEST: TEMPORARY CORPORATE HOUSING
CLEVELAND, INC.

/s/ Kris L, Benjamin BY /s/ Lynda D. Clutchey
- ------------------------------ -----------------------------------
Kris L. Benjamin Lynda D. Clutchey
Treasurer Vice President/Secretary

ATTEST: TEMPORARY CORPORATE HOUSING
CINCINNATI, INC.

/s/ Kris L. Benjamin BY /s/ Lynda D. Clutchey
- ------------------------------ -----------------------------------
Kris L. Benjamin Lynda D. Clutchey
Treasurer Vice President/Secretary

ATTEST: TEMPORARY CORPORATE HOUSING
COLUMBUS, INC.

/s/ Kris L. Benjamin BY /s/ Lynda D. Clutchey
- ------------------------------ -----------------------------------
Kris L. Benjamin Lynda D. Clutchey
Treasurer Vice President/Secretary

-4-

<PAGE> 5

State of

County of

On this, the 11TH day of September , 1995, before me, Pamela L. Smith,
personally appeared LYNDA D. CLUTCHEY, who acknowledged herself to be the
Vice-President and Secretary of Temporary Corporate Housing, Pittsburgh, Inc.,
Temporary Corporate Housing Cleveland, Inc., Temporary Corporate Housing
Cincinnati, Inc. and Temporary Corporate Housing Columbus, Inc., corporations
and that as such Vice-President and Secretary being authorized to do so,
executed the foregoing instrument for the purpose therein contained by signing
the name of the corporation by herself as Vice-President and Secretary.

In witness whereof, I hereunto set my hand and official seal.

/s/ Pamela L. Smith
-----------------------------------------
Pamela L. Smith
Notary Public, State of Ohio
My Commission Expires 1/1/2000
-----------------------------------------

State of

County of

On this, the 11TH day of September , 1995, before me, Pamela L. Smith,
personally appeared KRIS L. BENJAMIN, who acknowledged herself to be the
Treasurer of Temporary Corporate Housing, Pittsburgh, Inc., Temporary Corporate
Housing Cleveland, Inc., Temporary Corporate Housing Cincinnati, Inc. and
Temporary Corporate Housing Columbus, Inc., corporations and that as such
Treasurer being authorized to do so, executed the foregoing instrument for the
purpose therein contained by signing the name of the corporation by herself as
Treasurer.

In witness whereof, I hereunto set my hand and official seal.

/s/ Pamela L. Smith
------------------------------------------
Pamela L. Smith
Notary Public, State of Ohio
My Commission Expires 1/1/2000
------------------------------------------

-5-

<PAGE> 6

EXHIBIT "A"

CONTEMPORARY Traditional Country Shaker

ITEM PACKAGE PACKAGE PACKAGE PACKAGE PACKAGE

<S> <C> <C> <C> <C> <C>
Sofa Black Jack/ Lomera/ Woodbridge/ Globe Decked out
Loveseat Pgh. Black Zapier/ Molly Bridge Ocean
Chair Danzibar Wedgewood
Cocktail Wrought Iron Whitewash Cherry Q.A. Green & Cherry Cream Diamond/
Pine Shaker
(2) Ends Wrought Iron Whitewash Cherry Q.A. Country Shaker
(2) Lamps Contemporary Contemporary Traditional Country Country
Dinette 42" Black 42" rd. slat Cherry Q.A. 40" x 60" Nat. Table, cream
and four and Glass/ back/ Cherry Q.A. Green & Chair/
chairs 36" x 60" 36" x 60" ww Cherry/ Green & Oak
Black/Glass surfboard 36" x 60" 36" x 60"
Green & Cherry
Dresser Maple Whitewash Cherry Q.A. Maple Maple
Mirror Maple Whitewash Cherry Q.A. Maple Maple
(2) N.S. Maple Whitewash Cherry Q.A. Maple Maple
Headboard Maple Whitewash Cherry Q.A. Maple Maple
2 Lamps Contemp Contemp Brass Shaker Shaker
Bedding Queen Queen Queen Queen Queen
TV Cart Wrought Iron Whitewash Cherry Q.A. Green & Cherry Cream/Pine

<S> <C>
One Bedroom Package $110.00 plus tax

No Charge substitutions -1 Parson Chair for 1 nightstand
-1 Occasional Chair for 1 loveseat
-1 Torchere Lamp at each Pennsylvanian Unit
-2 Bar stools for 5 piece dinette
-2 Twins for 1 Queen Bed

Charged substitutions: -$10.00 - Queen sleeper for sofa
Additional Rental Items -$8.00 - writing desk
-$8.00 - Desk Chair
-$3.00 - Desk Lamp

2 Bedroom Package $150.00 plus tax

</TABLE>

<PAGE> 7

2nd bedroom duplicate of 1st bedroom

No Charge substitution -30' x 60" Executive Desk
-Task Chair
-48" bookcase
-2 Drawer File
-Desk Lamp

Above in exchange for bedroom pieces

* Integrity will provide TCH with a no charge office model.
* Traditional package is limited to 15% of total TCH units in each city.
* $25.00 transportation charge on all furniture exchanges except product defect
or Integrity error.
* Vacancy credit - up to 10% of the "out on lease" units may receive vacancy
credits of up to one hundred (100%) percent of the months rent in November,
December, January, February and March for a maximum period of 90 days.

<PAGE> 1

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

To BridgeStreet Accommodations, Inc.

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) for BridgeStreet Accommodations,
Inc. dated April 10, 1997, for Temporary Corporate Housing Columbus, Inc. dated
February 28, 1997, for Corporate Lodgings, Inc. dated February 28, 1997, for
Exclusive Interim Properties, Ltd. dated March 11, 1997, and for Home Again,
Inc. dated March 21, 1997, included in or made part of this registration
statement.

/S/ ARTHUR ANDERSEN LLP

Boston, Massachusetts

July 11, 1997

<PAGE> 1

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

To BridgeStreet Accommodations, Inc.

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) for Temporary Housing Experts, Inc.,
dated March 21, 1997, included in or made part of this registration statement.

/S/ ARTHUR ANDERSEN LLP

Memphis, Tennessee

July 11, 1997

<ARTICLE> 5
<CURRENCY> U.S. DOLLARS

<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 877,806
<SECURITIES> 239,752
<RECEIVABLES> 3,231,733
<ALLOWANCES> 276,315
<INVENTORY> 0
<CURRENT-ASSETS> 5,495,117
<PP&E> 1,876,959
<DEPRECIATION> 62,299
<TOTAL-ASSETS> 14,996,869
<CURRENT-LIABILITIES> 4,962,213
<BONDS> 0
0
0
<COMMON> 8,246,266
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 8,006,484
<SALES> 0
<TOTAL-REVENUES> 9,102,402
<CGS> 7,012,402
<TOTAL-COSTS> 9,570,124
<OTHER-EXPENSES> 5,618
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (462,104)
<INCOME-TAX> (223,658)
<INCOME-CONTINUING> (238,446)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (238,446)
<EPS-PRIMARY> (0.04)
<EPS-DILUTED> 0

</TABLE>

<PAGE> 1

EXHIBIT 99.1

CONSENT OF JAMES M. BIGGAR TO SERVE AS A DIRECTOR

BRIDGESTREET ACCOMMODATIONS, INC.

If nominated or otherwise chosen to be a director of [BridgeStreet
Accommodations, Inc.], I hereby consent to being named in [BridgeStreet
Accommodations, Inc.'s] Registration Statement on Form S-1 as an individual who
has agreed to serve in such capacity.

/s/ JAMES M. BIGGAR

Dated: June 10, 1997

<PAGE> 1

EXHIBIT 99.2

CONSENT OF ROBERT R. MESEL TO SERVE AS A DIRECTOR

BRIDGESTREET ACCOMMODATIONS, INC.

/s/ ROBERT R. MESEL

Dated: June 9, 1997

<PAGE> 1

EXHIBIT 99.3

CONSENT OF JERRY SUE THORNTON, PH.D. TO SERVE AS A DIRECTOR
OF
BRIDGESTREET ACCOMMODATIONS, INC.

/s/ JERRY SUE THORNTON

Dated: June 11, 1997