MEMPHIS, Tenn. / July 30, 2001--Hampton(TM), the national brand of midpriced Hampton Inn® and Hampton Inn & Suites® hotels, today introduced a new smaller-hotel concept designed to provide travelers with the same amenities, comfort and services of a larger midmarket hotel, but in a small, rural town.

The new Hampton Inn concept is a compact 52-room design – the smallest to be offered by a nationally franchised, midpriced hotel brand.

"No matter where they stay, travelers today desire quality and consistency – something Hampton Inn is known for nationwide," said Phil Cordell, senior vice president, Hampton brand management.

"Therefore, we expect this smaller, midpriced Hampton Inn will be very well received in rural and tertiary markets where the choice has been nonbranded hotels, lower-quality properties or budget-type hotels. In these many small markets across the U.S., we want Hampton Inn to be regarded as the best hotel in town."

Until now, the hotel industry has not been able to design a cost- effective, midpriced hotel with fewer than 60 rooms. With 18 years of hotel design experience and the benefit of feedback from existing franchisees, Hampton has created such a hotel, resulting in an economically viable property for developers to build in smaller markets without compromising the level of quality expected from the Hampton brand.

"By offering the most important services and amenities traditionally used on short-term stays, the smaller Hampton Inn hotels will choose to offer highly competitive rates, with a target ranging from $65 to $75 per night," said Cordell.

"We anticipate that these rates will be particularly appealing to guests staying one or two nights and attending off-site meetings or engaging in off-site leisure activities for the duration of their visit.

"We believe that this new prototype will have a dramatic impact on the quality of stay for business and leisure travelers in hundreds of rural markets across the nation," Cordell continued. "In fact, Hampton has identified between 400-500 markets with strong potential demand for a smaller, midpriced product. We hope to open our first small Hampton Inn prototype in early 2002."

Following months of research and design evaluation, the smaller Hampton Inn is designed to vary in size from 52 to 58 rooms. In addition, the design can be adapted to include meeting space, an exercise facility, and to meet local business and leisure traveler needs. Each property also will offer a swimming pool (indoor or outdoor) and the option of special amenity packages, such as whirlpool spa suites.

To create the new prototype, Cordell asked architects and designers to throw out any previous concepts about hotel design and start with a fresh perspective. The result is a design that is so compact, it can fit comfortably on a 1.29-acre site.

The design introduces a number of innovations throughout the hotel. In the lobby, for example, a new walk-around front desk enables staff to carry out the normal check-in/check-out activities but with easier access to the lobby to better serve guests' needs, especially during the busy breakfast period. This is an important feature, since the smaller Hampton Inn hotel will provide the same high-quality, free breakfast daily.

Hampton also completely re-engineered the guest room concept for the hotel, creating a more open feel in a slightly smaller room footprint. For example, the outside window wall will be utilized for the first time as the backdrop for either a specially designed work desk or television armoire. The bed also is raised higher.

In order to get feedback from consumers in advance, Hampton built a model room at its Memphis Operations Center and tested it extensively. Response was very positive; male travelers liked the size/value of the room space, while women especially liked the walk-in shower feature, as well as the colorful decor.

Additionally, the back-of-the-house office area and laundry facilities were repositioned to allow for more efficient operation.

Cordell stressed that business and leisure travelers who travel to small-market destinations will enjoy the fact that they can find the services and amenities associated with the traditional Hampton brand, including the brand's upgraded free breakfast, free in-room movies, free local telephone calls and participation in the highly popular Hilton HHonors® guest reward program.

Hampton is part of Hilton Hotels Corp., recognized internationally as a pre-eminent hospitality company. The company develops, owns, manages or franchises more than 1,900 hotels, resorts and vacation- ownership properties. Its portfolio includes many of the world's best- known and most highly regarded hotel brands, including Hilton, Conrad, Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Harrison Conference Centers, Hilton Garden Inn, Hilton Grand Vacations Company, Homewood Suites by Hilton and Red Lion Hotels & Inns.

This news release contains "forward-looking statements" within the meaning of federal securities law, including statements concerning business strategies and their intended results, and similar statements concerning anticipated future events and expectations that are not historical facts. The forward-looking statements in this news release are subject to numerous risks and uncertainties, including the effects of economic conditions; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; the impact of government regulations; and the availability of capital to finance growth, which could cause actual results to differ materially from those expressed in or implied by the statements herein.

Note to Editors: The following service marks are owned by Hilton Hospitality Inc.: Hilton®, Hilton Garden Inn®, Doubletree®, Embassy Suites Hotels®, Hampton Inn®, Hampton Inn & Suites®, Homewood Suites® by Hilton, Red Lion Hotels & Inns®, Hilton Grand Vacations Company® and Conrad(TM). HHonors®, Double Dip®, Double Dipping® and Points & Miles(TM) are trademarks owned by Hilton HHonors Worldwide LLC.

Kendra Walker
Hilton Hotels Corporation Brand Communications
310/205-4545
Hilton