8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported) – July 25, 2018

EXTENDED STAY AMERICA, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-36190		46-3140312
(State or other jurisdiction of incorporation or organization)	(Commission File Number)		(I.R.S. Employer Identification Number)
11525 N. Community House Road, Suite 100 Charlotte, North Carolina		28277
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code (980) 345-1600

ESH HOSPITALITY, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-36191	27-3559821
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)
11525 N. Community House Road, Suite 100 Charlotte, North Carolina		28277
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code (980) 345-1600

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrants under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02. Results of Operations and Financial Condition.

On July 25, 2018, Extended Stay America, Inc. and ESH Hospitality, Inc. issued an earnings release announcing their results of operations for the three and six months ended June 30, 2018. A copy of the earnings release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference in this Item 2.02.

The information contained under Item 2.02 of this Current Report on Form 8-K (including Exhibit 99.1) is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 7.01. Regulation FD Disclosure.

On July 26, 2018, Extended Stay America, Inc. and ESH Hospitality, Inc. will hold a conference call announcing their results of operations for the three and six months ended June 30, 2018. A copy of management’s presentation materials is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference in this Item 7.01.

The information contained under Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.2) is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Exhibit Description
99.1	Earnings release of Extended Stay America, Inc. and ESH Hospitality, Inc., dated July 25, 2018, announcing results for the three and six months ended June 30, 2018.
99.2	Management’s presentation materials, dated July 25, 2018.

EXHIBIT INDEX

Exhibit Number	Exhibit Description
99.1	Earnings release of Extended Stay America, Inc. and ESH Hospitality, Inc., dated July 25, 2018, announcing results for the three and six months ended June 30, 2018.
99.2	Management’s presentation materials, dated July 25, 2018.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, each of the Registrants has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EXTENDED STAY AMERICA, INC.
Date: July 25, 2018	By:	/s/ Christopher N. Dekle
		Name: Christopher N. Dekle
		Title: General Counsel and Corporate Secretary

	ESH HOSPITALITY, INC.
Date: July 25, 2018	By:	/s/ Christopher N. Dekle
		Name: Christopher N. Dekle
		Title: General Counsel and Corporate Secretary

EX-99.1

EXTENDED STAY AMERICA ANNOUNCES SECOND QUARTER 2018 RESULTS

-Net Income of $65.6 million for the second quarter

-Adjusted EBITDA¹ of $167.3 million for the second quarter

-Comparable system-wide RevPAR grows 1.6% for the second quarter

-Announces hotels under contract to be sold and updates new hotel pipeline

CHARLOTTE, N.C. - July 25, 2018 (GlobeNewswire) - Extended Stay America, Inc. and ESH Hospitality, Inc. (Nasdaq:STAY) (together, the “Company”) today announced consolidated results for the three and six months ended June 30, 2018.

Second Quarter 2018 Highlights

• Total revenues of $336.5 million

• Comparable system-wide Revenue Per Available Room (“RevPAR”) grew 1.6% to $53.91

• Adjusted EBITDA of $167.3 million

• Adjusted Funds From Operations ("Adjusted FFO")¹ of $0.58 per diluted Paired Share, an increase of 10.0%

• Adjusted Paired Share Income¹ of $0.35 per diluted Paired Share, an increase of 11.7%

First Half 2018 Highlights

• Total revenues of $634.3 million

• Comparable system-wide RevPAR grew 2.6% to $50.72

• Adjusted EBITDA of $299.5 million

• Adjusted FFO of $1.00 per diluted Paired Share, an increase of 13.4%

• Adjusted Paired Share Income of $0.54 per diluted Paired Share, an increase of 18.8%

Extended Stay America’s President and Chief Executive Officer, Jonathan Halkyard, commented, “The second quarter marked another quarter of progress on our growth strategy. In the last few months, we grew our total pipeline to 34 hotels, including 19 franchise hotels, we purchased a hotel for conversion, purchased an additional site for a new hotel and we expect to purchase several more sites in the second half of 2018.”

Mr. Halkyard continued, “Our operating model, combined with strong capital returns, allowed us to grow Adjusted FFO and Adjusted Paired Share Income per Paired Share by double digit increases for the second quarter in a row.”

Financial and Operating Results

Total revenues for the three months ended June 30, 2018 were $336.5 million, a decrease of 0.6% over the same period in 2017. The decrease in revenue was driven by hotel dispositions in 2017 and in 2018, partially offset by an increase in RevPAR and

franchise and management fee revenue. Total revenues on a comparable basis increased 1.8% for the quarter. Total revenues for

¹ See “Disclosure Regarding Non-GAAP Financial Measures” for an explanation of non-GAAP measures included in this release (i.e., Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, Funds from Operations ("FFO"), Adjusted FFO, Adjusted FFO per diluted Paired Share, Paired Share Income, Adjusted Paired Share Income and Adjusted Paired Share Income per diluted Paired Share).

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the first six months of 2018 were $634.3 million, an increase of 0.8% over the same period in 2017. Total revenues on a comparable basis increased 2.7% for the first six months of 2018 compared to the same period in 2017.

Comparable system-wide RevPAR for the three months ended June 30, 2018 grew 1.6% over the same period in 2017 to $53.91, driven by an improvement in average daily rate (“ADR”) of 3.4%, partially offset by a 130 basis point decline in occupancy. Comparable company-owned RevPAR increased 1.7% during the quarter to $54.28. Company-owned RevPAR increased 2.4% during the quarter, reflecting the sales of non-core hotels and the increase in comparable company-owned RevPAR. Comparable system-wide RevPAR for the first half of 2018 grew 2.6% over the same period in 2017.

Hotel Operating Margin¹for the three months ended June 30, 2018 was 56.4% compared to 56.7% in the same period in 2017. The decline in Hotel Operating Margin was driven by an increase in payroll and reservation expenses. Hotel Operating Margin for the first half of 2018 was 54.5% compared to 54.8% in the same period in 2017.

Net income for the three months ended June 30, 2018 was $65.6 million compared to $49.7 million in the same period in 2017, an increase of 31.9%. Net income in the second quarter was favorably impacted by a decrease in effective tax rate, lower depreciation and amortization, a reduction in hotel operating expenses and reduced impairment charges. Income tax expense for the three months ended June 30, 2018 was $14.4 million compared to $15.9 million in the same period in 2017. Net income for the first half of 2018 was $96.7 million compared to $65.8 million in the same period in 2017, an increase of 46.9%.

Adjusted EBITDA for the three months ended June 30, 2018 was $167.3 million, a decline of 3.2% compared to the same period in 2017. The decline in Adjusted EBITDA was due to asset dispositions in 2017 and 2018 resulting in lost contributions of approximately $6.0 million. Adjusted EBITDA excludes non-cash equity-based compensation expense of $1.8 million and net gain of $0.3 million on other items. Adjusted EBITDA for the first six months of 2018 was $299.5 million, a decline of 1.0% compared to the same period in 2017 due to asset dispositions in 2017 and 2018.

Adjusted FFO for the three months ended June 30, 2018 was $109.9 million, an increase of 7.8% compared to the same period in 2017. The increase in Adjusted FFO was primarily due to a lower effective tax rate and a reduction in hotel operating expenses. Adjusted FFO per diluted Paired Share was $0.58 compared to $0.53 in the same period in 2017. Adjusted FFO for the first six months of 2018 was $189.9 million, an increase of 11.3% compared to the same period in 2017. Adjusted FFO per Paired Share for the first six months of 2018 was $1.00 compared to $0.88 in the same period in 2017. Adjusted FFO, a non-GAAP measure, represents funds from operations, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. A Paired Share entitles its holder to participate in 100% of the common equity and earnings of both Extended Stay America, Inc. and ESH Hospitality, Inc.

Adjusted Paired Share Income for the three months ended June 30, 2018 was $66.3 million, or $0.35 per diluted Paired Share, compared to $60.5 million, or $0.31 per diluted Paired Share, in the same period in 2017.The increase in Adjusted Paired Share Income was due to a decrease in effective tax rate and lower depreciation expense.Adjusted Paired Share Income for the first half of 2018 was $103.7 million, or $0.54 per diluted Paired Share, compared to $89.0 million, or $0.46 per diluted Paired Share, in the same period in 2017. Adjusted Paired Share Income, a non-GAAP measure, represents net income, as adjusted, attributable to the

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consolidated enterprise, whose representative equity security is a Paired Share.

Capital Expenditures

The Company invested $56.2 million in capital expenditures during the second quarter of 2018. This included approximately $14.6 million in capital expenditures for new hotel development and conversions and $14.9 million in capital expenditures for IT projects. For the first half of 2018, the Company invested $89.7 million in capital expenditures.

Asset Dispositions and Acquisitions

The Company has signed purchase and sale agreements with three portfolio buyers for a total of 46 hotels. Under the terms of these agreements, the hotels will remain branded as Extended Stay America, the buyers will pay franchise fees to the Company and the buyers will agree to build or convert additional Extended Stay America hotels in the future. These transactions, subject to customary due diligence, are expected to close in 2018 or early 2019.

In the second quarter of 2018, the Company purchased and converted one hotel for approximately $13.0 million. The Company expects to purchase another hotel for conversion in the second half of 2018.

Hotel Pipeline, as of June 30, 2018

As of June 30, 2018, the Company had a pipeline of 34 hotels representing approximately 4,200 rooms.

Company Owned Pipeline & Recently Opened as of June 30, 2018
Under Option		Pre-Development		Under Construction		Total Pipeline		Opened YTD
# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms
11	1,367	4	504	0	0	15	1,871	1	115
Third Party Pipeline as of June 30, 2018
Commitments		Applications		Executed		Total Pipeline		Opened YTD
# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms
15	1,860	4	496	0	0	19	2,356	0	0

Definitions
Under Option	Locations with a signed purchase and sale agreement
Pre-Development	Land purchased, permitting and/or site work
Under Construction	Hotel is under construction
Commitments	Signed commitment to build a certain number of hotels
Applications	Submitted a franchise application with deposit
Executed	Application approved, various stages of pre-development and under construction

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Distribution and Share Repurchases

On July 25, 2018, the Boards of Directors of Extended Stay America, Inc. and ESH Hospitality, Inc. declared cash distributions totaling $0.22 per Paired Share for the second quarter of 2018. The distributions are payable on August 23, 2018 to shareholders of record as of August 9, 2018.

During the second quarter of 2018, the Company repurchased 1.6 million Paired Shares for an aggregate purchase price of $32.8 million. For the first six months of 2018, the Company repurchased 3.4 million Paired Shares for an aggregate purchase price of $68.0 million. As of market close on July 25, 2018, the Company had approximately $128.2 million in share repurchase authorization remaining.

2018 Outlook

The Company’s outlook for 2018 is updated as follows:

Full Year 2018		Updated Outlook				Previous Outlook
in millions, except % and # of hotels	Low			High		Low		High
# of hotels owned on 12/31/18	600					600
Room and other hotel revenues	$		1,257	$	1,279	$	1,257	$	1,282
Comparable system-wide RevPAR % Δ			1.0%		2.75%		1.0%		3.0%
Net income	$		194	$	208	$	188	$	207
Adjusted Paired Share Income/Paired Share	$		1.07	$	1.15	$	1.04	$	1.14
Adjusted EBITDA	$		595	$	610	$	600	$	620
Comparable Adjusted EBITDA % Δ			-1.3%		+1.2%		-0.5%		+2.8%
Depreciation and amortization	$		213	$	213	$	220	$	220
Net interest expense	$		130	$	130	$	130	$	130
Effective tax rate			16.5%		17%		16%		17%
Capital expenditures	$		205	$	235	$	205	$	235
Expected capital returns	$		260	$	300	$	260	$	300

Our updated comparable system-wide RevPAR and adjusted EBITDA guidance now includes renovation room disruption in the fourth quarter of 2018. While unchanged in total from prior guidance, our 2018 capital expenditure outlook now reflects capital expenditures for our next cycle of hotel renovations beginning in the fourth quarter of 2018, offset by a reduction in expected maintenance and ESA 2.0 related capital expenditures. The above guidance assumes no further asset dispositions in 2018 but does assume the purchase of one additional hotel for conversion.

Webcast and Conference Call Details

The Company will host a conference call on Thursday, July 26, 2018 at 8:30 a.m. Eastern Time. The conference call will be webcast simultaneously in the Investor Relations section of the Company’s website at www.aboutstay.com. A replay of the call will be available for 90 days following the webcast on the Company’s website.

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Alternatively, the conference call can be accessed by dialing 1-877-705-6003 for domestic callers or 1-201-493-6725 for international callers. A telephone replay will be available from shortly after the call until August 2, 2018, and can be accessed by dialing 1-844-512-2921for domestic callers or 1-412-317-6671for international callers. The passcode for the replay is 13681523.

Disclosure Regarding Non-GAAP Financial Measures

Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, Adjusted FFO per diluted Paired Share, Paired Share Income, Adjusted Paired Share Income and Adjusted Paired Share Income per diluted Paired Share (collectively, the “Non-GAAP Financial Measures”), which are detailed in the reconciliation tables that accompany this release, are used by the Company as supplemental performance measures. The Company believes these measures provide useful information to investors regarding our results of operations and allow investors to evaluate the ongoing operating performance of our hotels and facilitate comparisons between the Company and other lodging companies, hotel owners and capital-intensive companies, including those which include a REIT as part of their legal entity structure. The Non-GAAP Financial Measures are not recognized terms under U.S. GAAP.  These measures as presented may not be comparable to measures calculated by other companies. These measures should not be considered as alternative measures of, or superior to, operating profit, net income, net income per share or any other measure of the Company, Extended Stay America, Inc. or ESH Hospitality, Inc. calculated in accordance with U.S. GAAP.  The Company’s presentation of the Non-GAAP Financial Measures does not replace the presentation of the Company’s consolidated financial statements and other disclosures prepared in accordance with U.S. GAAP.

Forward Looking Statements

This release contains forward-looking statements within the meaning of the federal securities laws. Forward looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results or performance to differ from those projected in the forward-looking statements, possibly materially. For a description of factors that may cause the Company’s actual results or performance to differ from projected results or performance implied by forward-looking statements, please review the information under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” included in the Company’s combined annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 27, 2018 and other documents of the Company on file with or furnished to the SEC. Any forward-looking statements made in this release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company, its business or operations. Except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual results may differ materially from what is expressed, implied or forecasted by the Company’s forward-looking statements.

About Extended Stay America

Extended Stay America, Inc. (“ESA”) is the largest integrated hotel owner/operator in North America.  Its subsidiary, ESH Hospitality, Inc. (“ESH”), is the largest lodging REIT in North America by unit and room count, with 599 hotels and approximately 66,000 rooms in the U.S. ESA manages all of ESH’s hotel properties in addition to 27 Extended Stay America branded hotels for third parties, providing over 8,000 jobs at Extended Stay America hotels and corporate headquarters. Extended

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Stay America^® is the leading brand in the mid-priced extended stay segment, with approximately twice as many rooms as its nearest competitor. Visit www.esa.com for more information.

Contacts
Investors:	Media:
Rob Ballew	Terry Atkins
(980) 345-1546	(980) 345-1648
investorrelations@esa.com	tatkins@esa.com

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EXTENDED STAY AMERICA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(In thousands, except per share data)
(unaudited)
Three Months Ended									Six Months Ended
June 30,									June 30,
2018			2017			% Variance			2018			2017			% Variance
							REVENUES:
$	326,948		$	332,608		(1.7)%	Room revenues		$	617,158		$	618,416		(0.2)%
5,492			5,755			(4.6)%	Other hotel revenues		10,767			10,938			(1.6)%
1,424			—			n/a	Franchise and management fees		2,047			—			n/a
333,864			338,363			(1.3)%			629,972			629,354			0.1%
2,637			—			n/a	Other revenues from franchised and managed properties		4,296			—			n/a
336,501			338,363			(0.6)%	Total revenues		634,268			629,354			0.8%
							OPERATING EXPENSES:
144,054			148,911			(3.3)%	Hotel operating expenses		286,684			290,571			(1.3)%
24,264			25,430			(4.6)%	General and administrative expenses		49,485			51,737			(4.4)%
53,499			57,804			(7.4)%	Depreciation and amortization		107,514			115,475			(6.9)%
—			7,934			n/a	Impairment of long-lived assets		43,600			20,357			114.2%
221,817			240,079			(7.6)%			487,283			478,140			1.9%
2,637			—			n/a	Other expenses from franchised and managed properties		4,296			—			n/a
224,454			240,079			(6.5)%	Total operating expenses		491,579			478,140			2.8%
—			(1,897		)	n/a	GAIN (LOSS) ON SALE OF HOTEL PROPERTIES		38,082			(1,897		)	2,107.5%
457			2,055			(77.8)%	OTHER INCOME		462			2,056			(77.5)%
112,504			98,442			14.3%	INCOME FROM OPERATIONS		181,233			151,373			19.7%
102			1,073			(90.5)%	OTHER NON-OPERATING EXPENSE (INCOME)		299			(148		)	302.0%
32,425			31,701			2.3%	INTEREST EXPENSE, NET		64,065			65,307			(1.9)%
79,977			65,668			21.8%	INCOME BEFORE INCOME TAX EXPENSE		116,869			86,214			35.6%
14,407			15,943			(9.6)%	INCOME TAX EXPENSE		20,204			20,426			(1.1)%
65,570			49,725			31.9%	NET INCOME		96,665			65,788			46.9%
(514		)	2,050			(125.1)%	NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS (1)		(16,757		)	9,088			(284.4)%
$	65,056		$	51,775		25.7%	NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC COMMON SHAREHOLDERS		$	79,908		$	74,876		6.7%
$	0.34		$	0.27			NET INCOME PER EXTENDED STAY AMERICA, INC. COMMON SHARE - DILUTED		$	0.42		$	0.39
190,183			193,944				WEIGHTED-AVERAGE EXTENDED STAY AMERICA, INC. COMMON SHARES OUTSTANDING - DILUTED		190,709			194,372
(1) Noncontrolling interests in Extended Stay America, Inc. include approximately 43% of ESH REIT's common equity as of June 30, 2018 and 2017.
							CONSOLIDATED BALANCE SHEET DATA
							AS OF JUNE 30, 2018 AND DECEMBER 31, 2017
							(In thousands)
							(unaudited)
								June 30,				December 31,
									2018			2017
							Cash and cash equivalents		$	183,193		$	113,343
							Restricted cash		$	44,245		$	37,631
							Total assets		$	3,984,586		$	4,076,005
							Total debt, net of unamortized deferred financing costs and debt discounts (2)		$	2,480,080		$	2,541,901
							Total equity		$	1,294,601		$	1,345,847
							(2) Unamortized deferred financing costs and debt discounts totaled approximately $44.7 million and $49.0 million as of June 30, 2018 and December 31, 2017, respectively.

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EXTENDED STAY AMERICA, INC.
COMPARABLE SYSTEM-WIDE OPERATING METRICS (1)
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited)
Three Months Ended					Six Months Ended
June 30,					June 30,
2018	2017	Variance			2018	2017	Variance
625	625	—		Number of hotels (as of June 30)	625	625	—
68,780	68,780	—		Number of rooms (as of June 30)	68,780	68,780	—
77.6%	78.9%	(130) bps		Comparable System-Wide occupancy	74.0%	74.7%	(70) bps
$69.50	$67.21	3.4	%	Comparable System-Wide ADR	$68.58	$66.15	3.7	%
$53.91	$53.04	1.6	%	Comparable System-Wide RevPAR	$50.72	$49.44	2.6	%

COMPARABLE COMPANY-OWNED OPERATING METRICS (2)
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited)
Three Months Ended					Six Months Ended
June 30,					June 30,
2018	2017	Variance			2018	2017	Variance
598	598	—		Number of hotels (as of June 30)	598	598	—
66,089	66,089	—		Number of rooms (as of June 30)	66,089	66,089	—
77.6%	79.1%	(150) bps		Comparable Company-Owned occupancy	74.1%	74.9%	(80) bps
$69.91	$67.52	3.5	%	Comparable Company-Owned ADR	$69.00	$66.51	3.7	%
$54.28	$53.38	1.7	%	Comparable Company-Owned RevPAR	$51.12	$49.80	2.7	%

COMPANY-OWNED HOTEL OPERATING METRICS (3)
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(Unaudited)
Three Months Ended					Six Months Ended
June 30,					June 30,
2018	2017	Variance			2018	2017	Variance
599	625	(26	)	Number of hotels (as of June 30)	599	625	(26	)
66,204	68,780	(2,576	)	Number of rooms (as of June 30)	66,204	68,780	(2,576	)
77.6%	78.9%	(130) bps		Occupancy	74.1%	74.7%	(60) bps
$69.91	$67.20	4.0	%	ADR	$69.00	$66.16	4.3	%
$54.27	$53.02	2.4	%	RevPAR	$51.12	$49.40	3.5	%
(1) Includes hotels that were owned, franchised and/or managed for the full three and six month periods ended June 30, 2018 and 2017.
(2) Includes hotels owned and operated by the Company for the full three and six month periods ended June 30, 2018 and 2017.
(3) Includes hotels owned and operated during the periods presented.

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EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME TO HOTEL OPERATING PROFIT AND HOTEL OPERATING MARGIN
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(In thousands)
(Unaudited)
Three Months Ended									Six Months Ended
June 30,									June 30,
2018			2017			Variance			2018			2017			Variance
$	65,570		$	49,725		31.9	%	Net income	$	96,665		$	65,788		46.9	%
14,407			15,943			(9.6)%		Income tax expense	20,204			20,426			(1.1	)%
32,425			31,701			2.3	%	Interest expense, net	64,065			65,307			(1.9	)%
102			1,073			(90.5)%		Other non-operating expense (income)	299			(148		)	302.0	%
(457		)	(2,055		)	(77.8)%		Other income	(462		)	(2,056		)	(77.5	)%
—			1,897			n/a		(Gain) loss on sale of hotel properties	(38,082		)	1,897			(2,107.5	)%
—			7,934			n/a		Impairment of long-lived assets	43,600			20,357			114.2	%
53,499			57,804			(7.4)%		Depreciation and amortization	107,514			115,475			(6.9	)%
24,264			25,430			(4.6)%		General and administrative expenses	49,485			51,737			(4.4	)%
(824		)	2,548			(132.3)%		(Gain) loss on disposal of assets (1)	668			6,018			(88.9	)%
(1,424		)	—			n/a		Franchise and management fees	(2,047		)	—			n/a
$	187,562		$	192,000		(2.3)%		Hotel Operating Profit	$	341,909		$	344,801		(0.8	)%
$	326,948		$	332,608		(1.7)%		Room revenues	$	617,158		$	618,416		(0.2	)%
5,492			5,755			(4.6)%		Other hotel revenues	10,767			10,938			(1.6	)%
$	332,440		$	338,363		(1.8)%		Total room and other hotel revenues	$	627,925		$	629,354		(0.2	)%
56.4		%	56.7		%	(30) bps		Hotel Operating Margin	54.5		%	54.8		%	(30) bps
(1) Included in hotel operating expenses in the unaudited condensed consolidated statements of operations.

9

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(In thousands)
(Unaudited)
Three Months Ended								Six Months Ended
June 30,								June 30,
2018				2017				2018				2017
$	65,570			$	49,725		Net income	$	96,665			$	65,788
32,425				31,701			Interest expense, net	64,065				65,307
14,407				15,943			Income tax expense	20,204				20,426
53,499				57,804			Depreciation and amortization	107,514				115,475
165,901				155,173			EBITDA	288,448				266,996
1,785				3,646			Non-cash equity-based compensation	4,188				6,329
102			(1)	1,073		(2)	Other non-operating expense (income)	299			(3)	(148		)	(4)
—				7,934			Impairment of long-lived assets	43,600				20,357
—				1,897			(Gain) on sale of hotel properties	(38,082		)		1,897
(451		)	(5)	3,125		(6)	Other (income) expenses	1,048			(7)	7,019			(8)
$	167,337			$	172,848		Adjusted EBITDA	$	299,501			$	302,450
(1) Includes foreign currency transaction loss of approximately $0.1 million.
(2) Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million.
(3) Includes foreign currency transaction loss of approximately $0.3 million.
(4) Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million.
(5) Includes gain on disposal of assets of approximately $0.8 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel.
(6) Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with secondary offerings of approximately $0.6 million.
(7) Includes loss on disposal of assets of approximately $0.7 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel.
(8)  Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with secondary offerings of approximately $1.0 million.

10

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC.
COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS, ADJUSTED FUNDS FROM OPERATIONS
AND ADJUSTED FUNDS FROM OPERATIONS PER DILUTED PAIRED SHARE
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(In thousands, except per share and per Paired Share data)
(Unaudited)
Three Months Ended							Six Months Ended
June 30,							June 30,
2018			2017				2018			2017
$	0.34		$	0.27		Net income per Extended Stay America, Inc. common share - diluted	$	0.42		$	0.39
$	65,056		$	51,775		Net income attributable to Extended Stay America, Inc. common shareholders	$	79,908		$	74,876
510			(2,054		)	Noncontrolling interests attributable to Class B common shares of ESH REIT	16,749			(9,096		)
52,233			56,649			Real estate depreciation and amortization	104,981			113,182
—			7,934			Impairment of long-lived assets	43,600			20,357
—			1,897			(Gain) loss on sale of hotel properties	(38,082		)	1,897
(8,880		)	(15,423		)	Tax effect of adjustments to net income attributable to Extended Stay America, Inc. common shareholders	(18,605		)	(31,697		)
108,919			100,778			Funds From Operations	188,551			169,519
1,184			—			Debt modification and extinguishment costs	1,621			1,168
—			1,495			Loss on interest rate swap	—			253
(201		)	(347		)	Tax effect of adjustments to Funds From Operations	(274		)	(330		)
$	109,902		$	101,926		Adjusted Funds From Operations	$	189,898		$	170,610
$	0.58		$	0.53		Adjusted Funds From Operations per Paired Share- diluted	$	1.00		$	0.88
190,183			193,944			Weighted average Paired Shares outstanding – diluted	190,709			194,372

11

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC.
COMMON SHAREHOLDERS TO PAIRED SHARE INCOME, ADJUSTED PAIRED SHARE INCOME
AND ADJUSTED PAIRED SHARE INCOME PER DILUTED PAIRED SHARE
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017
(In thousands, except per share and per Paired Share data)
(Unaudited)
Three Months Ended June 30,									Six Months Ended June 30,
2018				2017					2018				2017
$	0.34			$	0.27			Net income per Extended Stay America, Inc. common share - diluted	$	0.42			$	0.39
$	65,056			$	51,775			Net income attributable to Extended Stay America, Inc. common shareholders	$	79,908			$	74,876
510				(2,054		)		Noncontrolling interests attributable to Class B common shares of ESH REIT	16,749				(9,096		)
65,566				49,721				Paired Share Income	96,657				65,780
1,184				—				Debt modification and extinguishment costs	1,621				1,168
102			(1)	1,073			(2)	Other non-operating expense (income)	299			(3)	(148		)	(4)
—				7,934				Impairment of long-lived assets	43,600				20,357
—				1,897				(Gain) loss on sale of hotel properties	(38,082		)		1,897
(451		)	(5)	3,125			(6)	Other (income) expense	1,048			(7)	7,019			(8)
(142		)		(3,255		)		Tax effect of adjustments to Paired Share Income	(1,419		)		(7,093		)
$	66,259			$	60,495			Adjusted Paired Share Income	$	103,724			$	88,980
$	0.35			$	0.31			Adjusted Paired Share Income per Paired Share – diluted	$	0.54			$	0.46
190,183				193,944				Weighted average Paired Shares outstanding – diluted	190,709				194,372
(1) Includes foreign currency transaction loss of approximately $0.1 million.
(2) Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million.
(3) Includes foreign currency transaction loss of approximately $0.3 million.
(4) Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million.
(5) Includes gain on disposal of assets of approximately $0.8 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel.
(6) Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with secondary offerings of approximately $0.6 million.
(7) Includes loss on disposal of assets of approximately $0.7 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel.
(8)  Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with secondary offerings of approximately $1.0 million.

12

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC.
COMMON SHAREHOLDERS TO PAIRED SHARE INCOME, ADJUSTED PAIRED SHARE INCOME
AND ADJUSTED PAIRED SHARE INCOME PER DILUTED PAIRED SHARE
FOR THE YEARS ENDED DECEMBER 31, 2017 (ACTUAL) AND 2018 (OUTLOOK)
(In thousands, except per share and per Paired Share data)
(Unaudited)
	Year Ended					Year Ending December 31, 2018
	December 31, 2017					(Outlook)
	(Actual)					Low				High
	$	0.41			Net income per Extended Stay America, Inc. common share - diluted	$	0.45			$	0.48
	$	78,847			Net income attributable to Extended Stay America, Inc. common shareholders	$	86,268			$	91,740
	93,325				Noncontrolling interests attributable to Class B common shares of ESH REIT	108,088				116,312
	172,172				Paired Share Income	194,356				208,052
	2,351				Debt modification and extinguishment costs	1,621				1,621
	(399		)	(1)	Other non-operating (income) expense	299			(2)	299			(2)
	25,169				Impairment of long-lived assets	43,600				43,600
	(9,973		)		Gain on sale of hotel properties	(38,082		)		(38,082		)
	9,866			(3)	Other expenses	5,000			(4)	5,000			(4)
	(6,241		)		Tax effect of adjustments to Paired Share Income	(2,114		)		(1,990		)
	$	192,945			Adjusted Paired Share Income	$	204,680			$	218,500
	$	1.00			Adjusted Paired Share Income per Paired Share – diluted	$	1.07			$	1.15
					% growth	7.7		%		15.0		%
	193,670				Weighted average Paired Shares outstanding – diluted	190,709				190,709
(1)	Includes foreign currency transaction gain of approximately $0.7 million and loss related to interest rate swap of approximately $0.3 million.
(2)	Includes foreign currency transaction loss of approximately $0.3 million.
(3)	Includes loss on disposal of assets of approximately $8.6 million, costs incurred in connection with 2017 secondary offering of approximately $1.1 million and transaction costs of approximately $0.2 million due to the revision of an estimate related to the sale of three hotel properties.
(4)	Includes loss on disposal of assets and other non-operating expenses.

13

EXTENDED STAY AMERICA, INC.
TOTAL REVENUES AND NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA
FOR YEARS ENDED DECEMBER 31, 2017 (ADJUSTED)(1) AND 2018 (OUTLOOK)(2)
(In thousands)
(Unaudited)
	Year Ended					Year Ending December 31, 2018
	December 31, 2017					(Outlook)(2)
	(Adjusted) (1)					Low				High
	$	1,238,825			Total revenues	$	1,257,000			$	1,279,000
	$	172,188			Net income	$	194,372			$	208,068
	129,772				Interest expense, net	130,000				130,000
	59,514				Income tax expense	39,811				41,115
	229,216				Depreciation and amortization	212,500				212,500
	590,690				EBITDA	576,683				591,683
	(19,906		)		Adjusted Property EBITDA of hotels not owned for entirety of periods presented (2)	—				—
	7,552				Equity-based compensation	7,500				7,500
	(399		)	(3)	Other non-operating (income) expense	299			(4)	299			(4)
	25,169				Impairment of long-lived assets	43,600				43,600
	(9,973		)		Gain on sale of hotel properties	(38,082		)		(38,082		)
	9,866			(5)	Other expenses	5,000			(6)	5,000			(6)
	$	602,999			Comparable Company-Owned Adjusted EBITDA(2)	$	595,000			$	610,000
					% growth	-1.3		%		1.2		%
(1)	2017 results adjusted to reflect only those 598 hotels owned and operated by the Company for the full six months ended June 30, 2018.
(2)	2018 outlook includes revenues of approximately $5.0 million and Adjusted EBITDA of approximately $2.0 million for the 26 hotels sold in the first quarter.
(3)	Includes foreign currency transaction gain of approximately $0.7 million and loss related to interest rate swap of approximately $0.3 million.
(4)	Includes foreign currency transaction loss of approximately $0.2 million.
(5)	Includes loss on disposal of assets of approximately $8.6 million, costs incurred in connection with 2017 secondary offerings of approximately $1.1 million and transaction costs of approximately $0.2 million due to the revision of an estimate related to the sale of hotel properties.
(6)	Includes loss on disposal of assets and other non-operating expenses.

14

EX-99.2

Q2 2018 Earnings Summary July 25, 2018 Extended Stay America, Inc. ESH Hospitality, Inc.

important disclosure information This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward looking statements involve known and unknown risks, uncertainties and other factors that may cause Extended Stay America, Inc.’s (the “Corporation”) and ESH Hospitality, Inc.’s (“ESH REIT,” and together with the Corporation, the “Company”) actual results or performance to differ from those projected in the forward-looking statements, possibly materially. For a description of factors that may cause the Company’s actual results or performance to differ from projected results or performance implied by forward- looking statements, please review the information under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” included in the Company’s combined annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 27, 2018 and other documents of the Company on file with or furnished to the SEC. Any forward- looking statements made in this presentation are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company, its business or operations. Except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual results may differ materially from what is expressed, implied or forecasted by the Company’s forward-looking statements. This presentation includes certain non-GAAP financial measures, including Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, Funds from Operations (“FFO”), Adjusted Funds From Operations (“Adjusted FFO”), Adjusted FFO per diluted Paired Share, Paired Share Income, Adjusted Paired Share Income and Adjusted Paired Share Income per diluted Paired Share. These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with U.S. GAAP. Please refer to the Appendix of this presentation for a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with U.S. GAAP, and to the Company’s combined annual report on Form 10-K filed with the SEC on February 27, 2018 for definitions of these non-GAAP measures. 2

Q2 2018 Operating Results & Financial Highlights comparable system-wide revenue per available net income (in millions)1 room (“RevPAR”) $65.6 $53.04 $53.91 $49.7 Q2 2017 Q2 2018 Q2 2017 Q2 2018 hotel operating margin2 adjusted FFO per diluted Paired Share1,2 56.7% 56.4% $0.58 $0.53 Q2 2017 Q2 2018 Q2 2017 Q2 2018 adjusted EBITDA (in millions) 1,2 adjusted Paired Share income per diluted Paired Share1,2 $0.35 $172.8 $0.31 $167.3 Q2 2017 Q2 2018 Q2 2017 Q2 2018 1Net Income, Adjusted EBITDA, Adjusted FFO per diluted Paired Share and Adjusted Paired Shared Income per diluted Paired Share were affected by lost contribution from 4 hotels sold in May 2017, 1 hotel sold in December 2017 and 26 hotels sold in 1Q 2018. 2See Appendix for Hotel Operating Margin, Adjusted FFO per diluted Paired Share, Adjusted EBITDA and Adjusted Paired Share Income per diluted Paired Share reconciliations. 3

1H 2018 Operating Results & Financial Highlights comparable system-wide revPAR net income (in millions)1 $96.7 $50.72 $49.44 $65.8 1H 2017 1H 2018 1H 2017 1H 2018 hotel operating margin2 adjusted FFO per diluted Paired Share1,2 54.8% 54.5% $1.00 $0.88 1H 2017 1H 2018 1H 2017 1H 2018 adjusted EBITDA (in millions) 1,2 adjusted Paired Share income per diluted Paired Share1,2 $0.54 $302.5 $299.5 $0.46 1H 2017 1H 2018 1H 2017 1H 2018 1Net Income, Adjusted EBITDA, Adjusted FFO per diluted Paired Share and Adjusted Paired Shared Income per diluted Paired Share were affected by lost contribution from 4 hotels sold in May 2017, 1 hotel sold in December 2017 and 26 hotels sold in 1Q 2018. 2See Appendix for Hotel Operating Margin, Adjusted FFO per diluted Paired Share, Adjusted EBITDA and Adjusted Paired Share Income per diluted Paired Share reconciliations. 4

Quarterly Distribution and Select Balance Sheet Amounts quarterly distribution cash balance (in millions)2 per Paired Share1 +4.8% $0.22 $249.0 $227.4 $0.21 Q2 2017 Q2 2018 Q1 2018 Q2 2018 adjusted net debt / TTM adjusted EBITDA ratio3 debt outstanding (in millions)4 $2,528 $2,525 3.8X 3.7X Q1 2018 Q2 2018 Q1 2018 Q2 2018 ¹ Distribution dates of August 29, 2017 and August 23, 2018. 2 Includes restricted and unrestricted cash. 3 Net debt calculation is (gross debt – total restricted and unrestricted cash) divided by TTM Adjusted EBITDA on a 598 hotel basis for Q1 2018 and a 599 hotel basis for Q2 2018. 5 4 Gross debt outstanding (excludes discounts and deferred financing costs).

Asset Disposition Update ~150 ~150 ~75 77 31 30 46 4 5 Timing 2Q17 4Q17 1Q18 1Q18 2H18 FCF Multiple3 ~17.5x ~16x ~16x ~19.5x Gross $61 $16 $114 $45 Proceeds4 million million million million 1 Under three purchase and sale agreements to sell in total 46 hotels. Subject to customary due diligence, the Company expects to complete these transactions in 2018 or early 2019, 2 Expected number of hotel assets sold between 2019 and 2021. The actual number of hotels sold may differ. 3 Free Cash Flow Multiple (“FCF”) is equal to the gross proceeds / (TTM adjusted EBITDA – pro forma maintenance and renovation capex). 6 4 Gross proceeds before transaction expense. Three Wall gross transaction includes $1.9 million in franchise application fees.

Future Renovations – 4 packages Next cycle to begin in 4Q 2018 after a nearly 18 month break Future renovation capex spending will vary depending on expected returns at each hotel Base Renovation ~$5k per key •Paint, lighting, case goods, soft goods •Hotel tier average: 3.0 Standard Renovation ~$10k per key •Base renovation plus flooring, roller shades, soft seating, bath mirror, bath vanity light, bed frame, bathtub refinishing •Hotel tier average: 2.2 Premium Renovation ~$15k per key •Standard renovation plus new countertops, new kitchen sink and faucet, new bath vanity, bath accessories, 49” TV & Millwork closet shelf •Hotel tier average: 1.8 Premium Plus Renovation ~$20k per key • Premium renovation plus new appliances and new kitchen cabinets • Hotel tier average: 1.2 Actual renovations may vary. Hotel tiers are as outlined at June 2016 Investor Day material. 7

ESA Pipeline Update Company Owned Pipeline & Recently Opened as of June 30, 2018 Under Option Pre-Development Under Construction Total Pipeline Opened YTD # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms 11 1,367 4 504 0 0 15 1,871 1 115 Third Party Pipeline as of June 30, 2018 Commitments Applications Executed Total Pipeline Opened YTD # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms 15 1,860 4 496 0 0 19 2,356 0 0 Definitions Under Option Locations with a signed purchase and sale agreement Pre-Development Land purchased, permitting and/or site work Under Construction Hotel is under construction Commitments Signed commitment to build a certain number of hotels Applications Submitted a franchise application with deposit Executed Application approved, various stages of pre-development and under construction 8

Q2 2018 Results, Q3 2018 Guidance1 and Full Year 2018 Guidance1 (in millions, except %) Q2 2018 Guidance Q2 2018 Actual RevPAR % D2 1.0% to 3.0% 1.6% Adjusted EBITDA $164 to $170 $167.3 1 (in millions, except %) Q3 2018 Guidance RevPAR % D2 1.0% to 3.0% Adjusted EBITDA $170 $176 4 (in millions, except %) 2018 Guidance Prior Outlook RevPAR % D2 1.0% to 2.75% 1.0% to 3.0% Net income $194 $208 $188 $207 Adjusted EBITDA3 $595 $610 $600 $620 Depreciation and amortization $213 $213 $220 $220 Net interest expense $130 $130 $130 $130 Effective tax rate 16.5% 17.0% 16.0% 17.0% Adjusted Paired Share income $1.07 $1.15 $1.04 $1.14 per diluted Paired Share Expected capital returns $260 $300 $260 $300 Capital expenditures $205 $235 $205 $235 1 Guidance for Q3 2018 and full year 2018 is as of July 25, 2018. 2 RevPAR % D shown on a comparable system-wide basis. 3 Estimated lost contribution of approximately $18 million related to 5 hotel assets sold in 2017, and 26 hotel assets sold in early 2018 for the full year 2018. 4 Prior guidance from April 26, 2018 9

appendix

STATISTICS FOR THE 46 HOTELS UNDER CONTRACT TO BE SOLD (Unaudited) Q3 2017 Q4 2017 Q1 2018 Q2 2018 Total Expected Dispositions (46) Number of hotels 46 46 46 46 Number of rooms 4,778 4,778 4,778 4,778 Occupancy 70.0% 60.7% 62.6% 70.6% ADR $ 51.53 $ 51.98 $ 50.53 $ 51.78 RevPAR $ 36.05 $ 31.57 $ 31.62 $ 36.58 11

COMPANY-OWNED HOTEL REVENUES AND EXPENSES FOR THE 46 HOTELS UNDER CONTRACT FOR DISPOSITION (In thousands) (Unaudited) Total Expected Dispositions (46) Q3 2017 Q4 2017 Q1 2018 Q2 2018 Room revenues $ 15,846 $ 13,876 $ 13,597 $ 15,907 Other hotel revenues 312 293 298 346 Total hotel revenues 16,157 14,169 13,896 16,253 Hotel operating expenses 9,292 8,477 8,665 9,391 Hotel operating expenses includes loss (gain) on disposal of assets of: 96 58 (6) 23 12

NON-GAAP RECONCILIATION OF NET INCOME TO HOTEL OPERATING PROFIT AND HOTEL OPERATING MARGIN FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017 (In thousands) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2018 2017 Variance 2018 2017 Variance $ 65,570 $ 49,725 31.9% Net income $ 96,665 $ 65,788 46.9% 14,407 15,943 (9.6)% Income tax expense 20,204 20,426 (1.1)% 32,425 31,701 2.3% Interest expense, net 64,065 65,307 (1.9)% 102 1,073 (90.5)% Other non-operating expense (income) 299 (148) 302.0% (457) (2,055) (77.8)% Other income (462) (2,056) (77.5)% - 1,897 n/a (Gain) loss on sale of hotel properties (38,082) 1,897 2,107.5% - 7,934 n/a Impairment of long-lived assets 43,600 20,357 114.2% 53,499 57,804 (7.4)% Depreciation and amortization 107,514 115,475 (6.9)% 24,264 25,430 (4.6)% General and administrative expenses 49,485 51,737 (4.4)% (824) 2,548 132.3% (Gain) loss on disposal of assets (1) 668 6,018 (88.9)% (1,424) - n/a Franchise and management fees (2,047) - n/a $ 187,562 $ 192,000 (2.3)% Hotel Operating Profit $ 341,909 $ 344,801 (0.8)% $ 326,948 $ 332,608 (1.7)% Room revenues $ 617,158 $ 618,416 (0.2)% 5,492 5,755 (4.6)% Other hotel revenues 10,767 10,938 (1.6)% $ 332,440 $ 338,363 (1.8)% Total room and other hotel revenues $ 627,925 $ 629,354 (0.2)% 56.4% 56.7% (30) bps Hotel Operating Margin 54.5% 54.8% (30) bps (1) Included in hotel operating expenses in the unaudited condensed consolidated statements of operations. 13

NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017 (In thousands) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 $ 65,570 $ 49,725 Net income $ 96,665 $ 65,788 32,425 31,701 Interest expense, net 64,065 65,307 14,407 15,943 Income tax expense 20,204 20,426 53,499 57,804 Depreciation and amortization 107,514 115,475 165,901 155,173 EBITDA 288,448 266,996 1,785 3,646 Equity-based compensation 4,188 6,329 102 (1) 1,073 (2) Other non-operating expense (income) 299 (3) (148) (4) - 7,934 Impairment of long-lived assets 43,600 20,357 - 1,897 (Gain) loss on sale of hotel properties (38,082) 1,897 (451) (5) 3,125 (6) Other (income) expense 1,048 (7) 7,019 (8) $ 167,337 $ 172,848 Adjusted EBITDA $ 299,501 $ 302,450 (1) Includes foreign currency transaction loss of approximately $0.1 million. (2) Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million. (3) Includes foreign currency transaction loss of approximately $0.3 million. (4) Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million. (5) Includes gain on disposal of assets of approximately $0.8 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel. (6) Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with secondary offerings of approximately $0.6 million. (7) Includes loss on disposal of assets of approximately $0.7 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel. (8) Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with secondary offerings of approximately $1.0 million. 14

NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS, ADJUSTED FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS PER DILUTED PAIRED SHARE FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017 (In thousands, except per share and per Paired Share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net income per Extended Stay America, Inc. common share - $ 0.34 $ 0.27 $ 0.42 $ 0.39 diluted Net income attributable to Extended Stay America, Inc. common $ 65,056 $ 51,775 $ 79,908 $ 74,876 shareholders Noncontrolling interests attributable to Class B 510 (2,054) 16,749 (9,096) common shares of ESH REIT 52,233 56,649 Real estate depreciation and amortization 104,981 113,182 - 7,934 Impairment of long-lived assets 43,600 20,357 - 1,897 (Gain) loss on sale of hotel properties (38,082) 1,897 Tax effect of adjustments to net income attributable to Extended (8,880) (15,423) (18,605) (31,697) Stay America, Inc. common shareholders 108,919 100,778 Funds from Operations 188,551 169,519 1,184 - Debt modification and extinguishment costs 1,621 1,168 - 1,495 Loss on interest rate swap - 253 (201) (347) Tax effect of adjustments to Funds from Operations (274) (330) $ 109,902 $ 101,926 Adjusted Funds from Operations $ 189,898 $ 170,610 Adjusted Funds from Operations $ 0.58 $ 0.53 per Paired Share – diluted $ 1.00 $ 0.88 Weighted average Paired Shares 190,183 193,944 outstanding – diluted 190,709 194,372 15

NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS TO PAIRED SHARE INCOME, ADJUSTED PAIRED SHARE INCOME AND ADJUSTED PAIRED SHARE INCOME PER DILUTED PAIRED SHARE FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2018 AND 2017 (In thousands, except per share and per Paired Share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net income per Extended Stay America, Inc. common share - $ 0.34 $ 0.27 $ 0.42 $ 0.39 diluted Net income attributable to Extended Stay America, Inc. common $ 65,056 $ 51,775 shareholders $ 79,908 $ 74,876 Noncontrolling interests attributable to Class B 510 (2,054) common shares of ESH REIT 16,749 (9,096) 65,566 49,721 Paired Share Income 96,657 65,780 1,184 - Debt modification and extinguishment costs 1,621 1,168 102 (1) 1,073 (2) Other non-operating expense (income) 299 (3) (148) (4) - 7,934 Impairment of long-lived assets 43,600 20,357 - 1,897 (Gain) loss on sale of hotel properties (38,082) 1,897 (451) (5) 3,125 (6) Other (income) expense 1,048 (7) 7,019 (8) (142) (3,255) Tax effect of adjustments to Paired Share Income (1,419) (7,093) $ 66,259 $ 60,495 Adjusted Paired Share Income $ 103,724 $ 88,980 $ 0.35 $ 0.31 Adjusted Paired Share Income per Paired Share – diluted $ 0.54 $ 0.46 190,183 193,944 Weighted average Paired Shares outstanding – diluted 190,709 194,372 (1) Includes foreign currency transaction loss of approximately $0.1 million. (2) Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million. (3) Includes foreign currency transaction loss of approximately $0.3 million. (4) Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million. (5) Includes gain on disposal of assets of approximately $0.8 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel. (6) Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with secondary offerings of approximately $0.6 million. (7) Includes loss on disposal of assets of approximately $0.7 million and acquisition costs of approximately $0.3 million incurred in connection with the purchase of one hotel. (8) Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with secondary offerings of approximately $1.0 million. 16

TOTAL REVENUES AND NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA FOR THE YEARS ENDED DECEMBER 31, 2017 (ADJUSTED)1 AND 2018 (OUTLOOK)2 (In thousands) (Unaudited) Year Ended Year Ending December 31, 2018 December 31, 2017 (Outlook) (2) (Adjusted) (1) Low High $ 1,238,825 Total revenues $ 1,257,000 $ 1,279,000 $ 172,188 Net income $ 194,372 $ 208,068 129,772 Interest expense, net 130,000 130,000 59,514 Income tax expense 39,811 41,115 229,216 Depreciation and amortization 212,500 212,500 590,690 EBITDA 576,683 591,683 Adjusted Property EBITDA of hotels not owned (19,906) for entirety of period presented (2) - - 7,552 Equity-based compensation 7,500 7,500 (399) (3) Other non-operating (income) expense 299 (4) 299 (4) 25,169 Impairment of long-lived assets 43,600 43,600 (9,973) Gain on sale of hotel properties (38,082) (38,082) 9,866 (5) Other expense 5,000 (6) 5,000 (6) $ 602,999 Current Company-Owned Adjusted EBITDA (2) $ 595,000 $ 610,000 % growth -1.3% 1.2% (1) 2017 results adjusted to reflect only those 598 hotels owned and operated by the Company for the full six months ended June 30, 2018. (2) 2018 outlook includes revenues of approximately $5.0 million and Adjusted EBITDA of approximately $2.0 million for the 26 hotels sold in the first quarter. (3) Includes foreign currency transaction gain of approximately $0.7 million and loss related to interest rate swap of approximately $0.3 million. (4) Includes foreign currency transaction loss of approximately $0.2 million. (5) Includes loss on disposal of assets of approximately $8.6 million, costs incurred in connection with secondary offerings of approximately $1.1 million and transaction costs of approximately $0.2 million due to the revision of an estimate related to the sale of hotel properties. (6) Includes loss on disposal of assets and other non-operating expenses. 17

NON-GAAP RECONCILIATION OF NET INCOME TO PAIRED SHARE INCOME, ADJUSTED PAIRED SHARE INCOME AND ADJUSTED PAIRED SHARE INCOME PER DILUTED PAIRED SHARE FOR THE YEARS ENDED DECEMBER 31, 2017 (ACTUAL) AND 2018 (OUTLOOK) (In thousands, except per share and per Paired Share data) (Unaudited) Year Ended Year Ending December 31, 2018 December 31, 2017 (Outlook) (Actual) Low High Net income per Extended Stay America, Inc. common share - $ 0.41 $ 0.45 $ 0.48 diluted Net income attributable to Extended Stay America, Inc. common $ 78,847 shareholders $ 86,268 $ 91,740 Noncontrolling interests attributable to Class B common shares 93,325 of ESH REIT 108,088 116,312 172,172 Paired Share Income 194,356 208,052 2,351 Debt modification and extinguishment costs 1,621 1,621 (399) (1) Other non-operating (income) expense 299 (2) 299 (2) 25,169 Impairment of long-lived assets 43,600 43,600 (9,973) Gain on sale of hotel properties (38,082) (38,082) 9,866 (3) Other expense 5,000 (4) 5,000 (4) (6,241) Tax effect of adjustments to Paired Share Income (2,114) (1,990) $ 192,945 Adjusted Paired Share Income $ 204,680 $ 218,500 $ 1.00 Adjusted Paired Share Income per Paired Share – diluted $ 1.07 $ 1.15 % growth 7.7% 15.0% 193,670 Weighted average Paired Shares outstanding – diluted 190,709 190,709 (1) Includes foreign currency transaction gain of approximately $0.7 million and loss related to interest rate swap of approximately $0.3 million. (2) Includes foreign currency transaction loss of approximately $0.3 million. (3) Includes loss on disposal of assets of approximately $8.6 million, costs incurred in connection with secondary offerings of approximately $1.1 million and transaction costs of approximately $0.2 million due to the revision of an estimate related to the sale of three hotel properties. (4) Includes loss on disposal of assets and other non-operating expenses. 18