Blackstone Group Inc. and Starwood Capital Group agreed to buy Extended Stay America Inc., an operator of hotels and motels, for about US$6 billion, betting the industry will recover as progress in fighting the COVID-19 pandemic accelerates.

Blackstone and Starwood are paying US$19.50 per share for the hotel company, a roughly 15 per cent premium over Extended Stay’s closing price on Friday, according to a statement on Monday.

Extended Stay’s shares spiked as much as 36 per cent in New York before being halted. After early trading resumed, the stock was up 15 per cent at US$19.45 as of 9:05 a.m.

Ongoing vaccination campaigns are seeding a travel recovery that industry analysts argue could begin bearing fruit later this year. While leisure travel is widely expected to bounce back fastest, the wager on Extended Stay demonstrates confidence that a broader economic revival will encourage companies to put workers back on the road.

Extended Stay, which operates 650 midpriced hotels, focuses on a corner of the lodging industry that provides longer-term stays, often catering to construction crews, emergency responders and cost-conscious corporate workers. The company’s system-wide occupancy rate was 74 per cent last year, according to a filing, according to 44 per cent across the U.S. hotel industry.

The company’s steady performance during a travel freeze that ravaged the globally hospitality industry attracted investor interest. Last April, Starwood disclosed that it had spent US$137 million acquiring an 8.5 per cent stake in the company. The firm, led by Barry Sternlicht, currently owns 9.4 per cent of outstanding shares, according to the statement today. Blackstone also bought a stake in the company last year, but later sold it.

In addition to the hotel-operating company, an Extended Stay affiliate owns 564 hotel properties with 62,000 rooms, making it largest hotel real estate investment trust in North America, according to the company.

Blackstone was part of a group that bought Extended Stay out of bankruptcy in 2010 and took it public three years later. The firm has been a prolific investor in hotel real estate and operating companies in the past, including Hilton Worldwide Holdings Inc., La Quinta and others.

The firm has targeted investments in warehouses and other property types in recent months, but with Extended Stay it is once again betting on hotels.

“Travel and leisure is one of Blackstone’s highest conviction investment themes,” said Tyler Henritze, head of US acquisitions for Blackstone Real Estate, in the statement. “And we have confidence in the extended stay model.”