UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)



|/ X / | QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
|----- | ------------------------------------------
|      | OF THE SECURITIES EXCHANGE ACT OF 1934    

For the quarterly period ended September 30, 2000

OR



|/    / | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
|------ | -------------------------------------------------
|       | OF THE SECURITIES EXCHANGE ACT OF 1934           

For the transition period from __________ to __________

Commission File Number: 0-28108

Suburban Lodges of America, Inc.(Exact name of registrant as specified in its charter)



|Georgia                  | 58-1781184         
|------------------------ | -------------------
|(State of incorporation) | (IRS Employer      
|                         | Identification No.)



300 Galleria Parkway
Suite 1200
Atlanta, Georgia 30339
(Address of principal executive office, including zip code)

770-799-5000
(Registrant's telephone number, including area code)



Indicate by check mark whether the registrant has (1) filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES / X / NO / /



Number of shares of Common Stock, $.01 par value, outstanding as of October 31, 2000:

12,003,570





---





INDEX



|Part 1 - Financial Information            
|------------------------------------------
|                                          
|                                          
|                                          
|                                          
|                                          
|                                          
|                                          
|Part II - Other Information and Signatures
|                                          
|                                          
|Signatures                                





---



PART I,    ITEM 1.    FINANCIAL STATEMENTS



Suburban Lodges of America, Inc.
Consolidated Balance Sheets(dollar amounts in thousands)





|                                                              |   | (Unaudited)   |   |             
|------------------------------------------------------------- | - | ------------- | - | ------------
|                                                              |   | September 30, |   | December 31,
|                                                              |   | 2000          |   | 1999        
|                                                              |   |               |   |             
|Assets:                                                       |   |               |   |             
|Current assets:                                               |   |               |   |             
|Cash and cash equivalents                                     | $ | 9,803         | $ | 9,862       
|Accounts receivable, net of reserves of                       |   |               |   |             
|$381 (2000) and $191 (1999)                                   |   | 1,466         |   | 1,852       
|Hotel inventory and supplies                                  |   | 2,578         |   | 2,290       
|Prepaid and refundable income taxes                           |   |               |   | 1,163       
|Deferred income taxes                                         |   | 447           |   | 448         
|Prepaid expenses and other current assets                     |   | 1,966         |   | 1,511       
|Total current assets                                          |   | 16,260        |   | 17,126      
|                                                              |   |               |   |             
|Property and equipment, net of accumulated depreciation and   |   |               |   |             
|amortization of $25,568 (2000) and $18,600 (1999)             |   | 297,471       |   | 291,269     
|                                                              |   |               |   |             
|Notes receivable from HotelTools, Inc.                        |   | 6,125         |   | 344         
|Other notes receivable                                        |   | 4,517         |   | 4,992       
|Acquired intangible assets                                    |   | 3,556         |   | 3,617       
|Deferred loan costs                                           |   | 2,189         |   | 1,721       
|Other assets                                                  |   | 2,074         |   | 2,013       
|Total assets                                                  | $ | 332,192       | $ | 321,082     
|                                                              |   | ===========   |   | =========== 
|                                                              |   |               |   |             
|Liabilities and shareholders' equity:                         |   |               |   |             
|Current liabilities:                                          |   |               |   |             
|Current portion of long-term debt                             | $ | 1,340         | $ | 1,228       
|Construction accounts payable                                 |   | 1,459         |   | 1,752       
|Trade accounts payable                                        |   | 2,125         |   | 3,207       
|Accrued property taxes                                        |   | 1,367         |   | 1,113       
|Accrued wages and benefits                                    |   | 1,942         |   | 507         
|Other accrued liabilities                                     |   | 1,639         |   | 615         
|Income taxes payable                                          |   | 627           |   |             
|Other current liabilities                                     |   | 695           |   | 591         
|Total current liabilities                                     |   | 11,194        |   | 9,013       
|                                                              |   |               |   |             
|Long-term debt, excluding current portion                     |   | 114,538       |   | 97,891      
|Deferred income taxes                                         |   | 2,721         |   | 2,333       
|Other liabilities                                             |   | 197           |   | 84          
|Total liabilities                                             |   | 128,650       |   | 109,321     
|                                                              |   |               |   |             
|Shareholders' equity:                                         |   |               |   |             
|Common stock (15,738,968 and 15,734,072 shares, respectively) |   | 157           |   | 157         
|Additional paid-in capital                                    |   | 202,280       |   | 202,250     
|Retained earnings                                             |   | 23,820        |   | 19,345      
|                                                              |   | 226,257       |   | 221,752     
|Less treasury stock (3,735,398 and 1,781,400 shares,          |   |               |   |             
|respectively), at cost                                        |   | 22,715        |   | 9,991       
|Shareholders' equity, net                                     |   | 203,542       |   | 211,761     
|                                                              |   |               |   |             
|Total liabilities and shareholders' equity                    | $ | 332,192       | $ | 321,082     
|                                                              |   | ===========   |   | =========== 
|                                                              |   |               |   |             
|See accompanying notes to consolidated financial statements. 





---



Suburban Lodges of America, Inc.Consolidated Statements of Operations(in thousands, except per share amounts)



|                                                             | (Unaudited)        | (Unaudited)      
|------------------------------------------------------------ | ------------------ | -----------------
|                                                             | Three Months Ended | Nine Months Ended
|                                                             | Sept. 30, 2000     | Sept. 30, 1999   
|                                                             |                    |                  
|Revenue:                                                     |                    |                  
|Hotel revenue                                                | $                  | 19,094           
|Franchise and other revenue                                  |                    | 1,106            
|Total revenue                                                |                    | 20,200           
|                                                             |                    |                  
|                                                             |                    |                  
|Operating costs and expenses:                                |                    |                  
|Hotel operating expenses                                     |                    | 10,263           
|Corporate operating expenses                                 |                    | 2,630            
|Depreciation and amortization                                |                    | 2,437            
|                                                             |                    | 15,330           
|Reserve for loss on property sale                            |                    |                  
|Gains realized on property sales                             |                    |                  
|Operating costs and expenses - net                           |                    | 15,330           
|                                                             |                    |                  
|Income from operations                                       |                    | 4,870            
|                                                             |                    |                  
|Other income (expense):                                      |                    |                  
|Interest income                                              |                    | 193              
|Interest expense                                             |                    | (2,216)          
|Proceeds from legal settlement                               |                    |                  
|Other                                                        |                    | 9                
|Income before income taxes                                   |                    | 2,856            
|Provision for income taxes                                   |                    | 1,042            
|                                                             |                    |                  
|Net income                                                   | $                  | 1,814            
|                                                             |                    | ==========       
|Earnings per common share:                                   |                    |                  
|Basic                                                        |                    | $0.15            
|                                                             |                    | ==========       
|Diluted                                                      |                    | $0.15            
|                                                             |                    | ==========       
|                                                             |                    |                  
|Weighted average number of                                   |                    |                  
|common shares outstanding:                                   |                    |                  
|Basic                                                        |                    | 12,428           
|                                                             |                    | ==========       
|Diluted                                                      |                    | 12,467           
|                                                             |                    | ==========       
|                                                             |                    |                  
|See accompanying notes to consolidated financial statements.









---



Suburban Lodges of America, Inc.Consolidated Statements of Cash Flows(in thousands)



|                                                                 |                | (Unaudited)      
|---------------------------------------------------------------- | -------------- | -----------------
|                                                                 |                | Nine Months Ended
|                                                                 | Sept. 30, 2000 |                  
|Operating activities:                                            |                |                  
|Net income                                                       | $              | 4,475            
|Adjustments to reconcile net income to                           |                |                  
|net cash provided by operating activities:                       |                |                  
|Depreciation and amortization                                    |                | 7,241            
|Deferred income taxes                                            |                | 446              
|Equity in loss of joint venture                                  |                |                  
|Stock compensation                                               |                | 30               
|Gains realized on property sales                                 |                | (68)             
|Reserve for loss on property sale                                |                | 545              
|Changes in operating assets and liabilities - net of the effects |                |                  
|of acquisitions:                                                 |                |                  
|Accounts receivable                                              |                | 433              
|Other current assets                                             |                | 482              
|Other assets                                                     |                | (5,948)          
|Trade accounts payable                                           |                | (1,143)          
|Income taxes payable                                             |                | 627              
|Other current liabilities                                        |                | 2,783            
|Other liabilities                                                |                | 113              
|Net cash provided by operating activities                        |                | 10,016           
|                                                                 |                |                  
|Investing activities:                                            |                |                  
|Additions to property and equipment                              |                | (10,338)         
|Proceeds from sale of land (2000) or hotel property (1999)       |                | 230              
|Acquisitions, net of cash acquired                               |                | (641)            
|Decrease in construction accounts payable                        |                | (293)            
|Investment in and advances to joint venture                      |                |                  
|Net cash used by investing activities                            |                | (11,042)         
|                                                                 |                |                  
|Financing activities:                                            |                |                  
|Proceeds from issuance of long-term debt                         |                | 17,768           
|Principal payments on long-term debt                             |                | (3,609)          
|Amounts borrowed under line of credit                            |                | 7,000            
|Repayment of line of credit borrowings                           |                | (7,000)          
|Purchase of treasury stock                                       |                | (12,724)         
|Net increase in deferred loan costs                              |                | (468)            
|Net cash provided by financing activities                        |                | 967              
|                                                                 |                |                  
|Net decrease in cash and cash equivalents                        |                | (59)             
|                                                                 |                |                  
|Cash and cash equivalents at beginning of period                 |                | 9,862            
|                                                                 |                |                  
|Cash and cash equivalents at end of period                       | $              | 9,803            
|                                                                 |                | =========        
|Supplemental information:                                        |                |                  
|Interest paid net of interest capitalized                        | $              | 6,425            
|                                                                 |                | =========        
|Income taxes paid                                                | $              | 592              
|                                                                 |                | =========        
|                                                                 |                |                  
|See accompanying notes to consolidated financial statements.    





---



Suburban Lodges of America, Inc.Notes to Consolidated Financial Statements
(Unaudited)

1. BASIS OF PRESENTATION
2. LONG-TERM DEBT
3. ACQUISITIONS
4. EARNINGS PER COMMON SHARE
5. CONTINGENCIES
6. SEGMENT AND RELATED INFORMATION
7. RELATED PARTY TRANSACTIONS
8. RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform to the current year presentation.



PART I, ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

Comparison of the quarter ended September 30, 2000 to the quarter ended September 30, 1999

Hotel revenues increased by $1.4 million, or 8%, from $17.7 million in 1999 to $19.1 million in 2000. The largest portion ($1.3 million) of the increase was attributable to the four hotels opened or acquired by the Company between
July 1, 1999 and June 30, 2000 and operated for the full quarter ended September 30, 2000. Sixty hotels that operated for the full quarter in both 1999 and 2000 accounted for $0.1 million of the increase in hotel revenues. These sixty hotels increased
their combined Average Weekly Rate (AWR) by 1%, from $193.42 in 1999 to $195.15 in 2000. Occupancies at these hotels decreased from 84.9% in 1999 to 84.1% in 2000, while Weekly Revenue per Available Room (RevPAR) was unchanged at $164.55. For all
Company-owned hotels, AWR increased to $196.53 in 2000 from $193.42 in 1999, occupancy decreased slightly to 84.4% in 2000 from 84.9% in 1999, and weekly RevPAR increased to $166.37 in 2000 from $164.56 in 1999.

Franchise and other revenues increased by $0.1 million, or 15%, to $1.1 million in 2000. Franchise fees increased $0.2 million from increases in both the Suburban Lodge and GuestHouse International brands due to the larger number of
franchise locations open during the third quarter of 2000. At September 30, 2000, 52 franchised Suburban Lodge hotels were operating as compared with 45 at September 30, 1999. GuestHouse International franchised hotels operating at September 30, 2000
numbered 61 compared with 45 at September 30, 1999. Management fees declined $0.1 million in the current year quarter due to the Company managing 13 hotels for its franchises at September 30, 2000 compared to 20 hotels at September 30, 1999. The decline
in the number of managed hotels was due to a decision by one franchise group to start a management company to manage its four Suburban Lodge hotels and other properties, and by another franchise group to move the management of two of its Suburban Lodge
hotels to an independent management company. These management changes were effective June 1, 2000. Also, one of the hotels managed by the Company during the prior year quarter was acquired by the Company during the first quarter of 2000.

Hotel operating expenses increased approximately $1.4 million, or 16%, from $8.8 million in 1999 to $10.3 million in 2000. The sixty hotels that operated the full quarter in both 1999 and 2000 accounted for $0.8 million of the
increase. The four hotels opened or acquired by the Company between July 1, 1999 and June 30, 2000 and operated for the full quarter ended September 30, 2000 accounted for $0.6 million of the increase.

Corporate operating expenses increased $0.2 million or 9% from $2.4 million in 1999 to $2.6 million in 2000. The amount of corporate overhead that was project-related, and is therefore capitalized as land-acquisition or
hotel-construction cost, was $0.2 million less in 2000 than in 1999. Excluding the lower capitalization of project-related expenses, corporate operating expenses in the quarter ended September 30, 2000 were flat compared with the 1999 quarter.

Depreciation and amortization increased by $0.3 million, or 15%, from $2.2 million in 1999 to $2.4 million in 2000. The sixty hotels that operated for the full quarter in both 1999 and 2000 accounted for $0.2 million of the increase
while the four hotels opened or acquired by the Company between July 1, 1999 and June 30, 2000 accounted for $0.1 million of the increase in depreciation and amortization for hotel properties.

Interest expense, net of interest capitalized of $0.2 million and $0.3 million in 2000 and 1999 respectively, was $2.2 million in 2000 and $1.9 million in 1999. The increase in total interest charges incurred was due primarily to higher levels of debt
outstanding.

The effective income tax rate for the quarter ended September 30, 2000 was 36.5% compared to 39.0% for the prior year quarter. The decrease in the current year quarter was primarily due to lower effective state income tax rates.

Comparison of the nine months ended September 30, 2000 to the nine months ended September 30, 1999

Hotel revenues increased by $6.2 million, or 13%, from $47.0 million in 1999 to $53.1 million in 2000. The largest portion ($3.3 million) of the increase was attributable to the nine hotels opened by the Company during 1999 and
operated for the full nine-month period ended September 30, 2000. The Company opened two hotels and acquired one hotel during the nine-month period ended September 30, 2000. These three hotels accounted for $2.0 million of the increase. Fifty-two hotels
that operated for the full nine-month period in both 1999 and 2000 accounted for $1.0 million of the increase in hotel revenues. These fifty-two hotels increased their combined Average Weekly Rate (AWR) by 2%, from $189.63 in 1999 to $193.91 in 2000.
Occupancies at these hotels declined from 81.4% in 1999 to 80.1% in 2000, while Weekly Revenue per Available Room (RevPAR) increased 1%, from $153.92 in 1999 to $155.32 in 2000. For all Company-owned hotels, AWR increased to $196.56 in 2000 from $191.17
in 1999 and weekly RevPAR increased to $157.27 in 2000 from $152.44 in 1999. Occupancy was unchanged at 80.0% in both years.

The increases contributed by these three groups of hotels were offset by a $0.2 million decrease in hotel revenues in a hotel that was owned and operated by the Company until sold to a franchisee in February 1999.

Franchise and other revenues increased by $1.0 million, or 39%, to $3.4 million in 2000. The largest portion ($0.7 million) of the increase was attributable to incremental franchise fees and royalties for the GuestHouse International
brand, which was acquired on June 1, 1999. Franchise fees for the Suburban Lodge hotel brand increased $0.3 million due to the larger number of franchised locations open during the first nine months of 2000. At September 30, 2000, 52 franchised Suburban
Lodge hotels were operating as compared with 45 at September 30, 1999. GuestHouse International franchised hotels operating at September 30, 2000 numbered 61 compared with 45 at September 30, 1999. Management fees and other revenues were flat with last
year at $0.9 million.

Hotel operating expenses increased approximately $4.5 million, or 19%, from $24.2 million in 1999 to $28.7 million in 2000. The fifty-two hotels that operated the full nine-month period in both 1999 and 2000 accounted for $2.0 million
of the increase. The nine hotels opened by the Company during 1999 and operated for the full nine month period ended September 30, 2000 accounted for $1.4 million of the increase, while the three hotels that opened or were acquired by the Company during
the nine month period ended September 30, 2000 accounted for $1.1 million of the increase in hotel operating expense.

Corporate operating expenses increased $2.4 million, or 41%, from $5.8 million in 1999 to $8.2 million in 2000. Of this increase, approximately $1.2 million was attributable to incremental operating expenses incurred by GuestHouse
International. Additionally, the amount of corporate overhead that was project-related, and is therefore capitalized as land-acquisition or hotel-construction cost, was $0.6 million less in 2000 than in 1999. Excluding the incremental impact on reported
operating expenses of GuestHouse International and lower capitalization of project-related expenses, corporate operating expenses for the nine-month period ended September 30, 2000 increased by $0.6 million, or 8%, over such amounts for the 1999
nine-month period. The primary reasons for such increase were $0.2 million for additional staffing needed to support the growth of the Company's franchising business and $0.4 million for increased rent for the Corporate headquarters.

Depreciation and amortization increased by $1.3 million, or 22%, from $6.0 million in 1999 to $7.2 million in 2000. Hotel properties accounted for $1.1 million of the increase. In addition, $0.2 million was attributable to leasehold
improvements and equipment at the corporate headquarters and amortization of certain intangible assets (franchise contract rights and goodwill) recognized in connection with the GuestHouse International acquisition in June 1999 and the hotel acquisition
during the current year nine-month period.

The fifty-two hotels that operated for the full nine-month period in both 1999 and 2000 accounted for $0.5 million of the increase in depreciation and amortization for hotel properties while the nine hotels opened by the Company during
1999 accounted for $0.4 million of the increases. The three hotels opened or acquired by the Company during the current year nine-month period accounted for $0.2million of the increase.

The reserve for loss on property sale recorded in the current year nine-month period represents the write-down of an undeveloped site that the Company anticipates will sell at a loss.

During the first quarter of 1999, the Company sold a hotel resulting in a pre-tax gain of approximately $1,145,000. The hotel continues to operate as a Suburban Lodge under agreements that generate franchise and management fee income
for the Company.

Interest expense, net of interest capitalized of $0.6 million and $1.5 million in 2000 and 1999 respectively, was $6.4 million in 2000 and $4.6 million in 1999. The increase in total interest charges incurred was due primarily to
higher levels of debt outstanding.

The proceeds from legal settlement of $842,000 recorded in the current year nine-month period represent amounts received in settlement of a claim for lost profits associated with an abandoned development project. The Company also
received $315,000 as a part of this settlement representing reimbursement of certain costs and expenses.

The effective income tax rate for the nine-month period ended September 30, 2000 was 37.1% compared to 38.0% in the prior year. The decrease in the current year was primarily due to lower effective state income tax rates.

Seasonality

Following their initial ramp-up, the Company's hotels typically experience lower average occupancy rates and total revenues in the first and fourth calendar quarters of each year.

Liquidity and Capital Resources

From May 29, 1996, the date of the Company's initial public offering (the "IPO"), through December 31, 1998, the Company pursued a strategy of growing principally through hotel development. Accordingly, the number of Company-owned
hotels grew from eight at May 29, 1996 to 53 at December 31, 1998. Capital spending during this period exceeded $200 million and the principal sources of capital included the proceeds from the 1996 IPO and two subsequent public equity offerings during
1997, borrowings under a bank credit facility and operating cash flow.

During the latter portion of 1998, the Company revised its financing strategy to emphasize more traditional longer-term mortgages to fund the construction of hotels rather than relying on bank lines of credit with shorter final
maturities. The Company plans to use its current bank revolving credit facility to fund special projects, repurchase shares of its outstanding common stock and meet operating cash needs as necessary.

On March 28, 2000, the Company completed a $2,660,000 mortgage loan agreement with Empire Financial Services, Inc. with an initial interest rate of 9.25%. The interest rate is adjustable at the end of each twelve-month period to rates
based on prime plus 50 basis points. During the initial twelve-month period, the loan requires monthly payments of principal and interest totaling $24,362 based on a principal amortization period of 20 years with a final maturity of March 1, 2007. One
Company-owned hotel is pledged as collateral on this loan.

Effective September 27, 2000 the Company executed an amended and restated loan agreement with SouthTrust Bank which replaced the line of credit agreement executed on February 18, 2000. The amended and restated agreement consists of a
$10 million term loan and a revolving line of credit facility for amounts up to $15 million. A total of 10 Company-owned hotels are pledged as collateral on this loan agreement. The interest rate on the term loan is based on the Euro Rate plus 175 basis
points through December 31, 2000. Thereafter, the interest rate will be based on the Euro Rate plus 200 basis points. The term loan requires monthly payments of interest only through September 2001. Beginning October 1, 2001 the term loan requires monthly
payments of principal and interest based on a 20 year amortization period with a final maturity of September 30, 2008. Among other covenants, the agreement requires the Company to maintain certain financial ratios and a minimum level of tangible net
worth. The agreement also places restrictions on the amount of loans and advances the Company can make to third parties. At September 30, 2000, the Company was in compliance with these requirements.

Borrowings under the line of credit facility will bear interest, at the Company's option, at (i) the bank's prime rate or (ii) the Euro Rate plus 200 basis points. The line of credit facility expires on September 30, 2003. At September
30, 2000, there were no borrowings outstanding under the line of credit.

At September 30, 2000, the Company had approximately $115.9 million outstanding under long-term mortgage loan arrangements, including amounts classified as current maturities of long-term debt at that date. In the aggregate, these
loans require monthly principal and interest payments of $933,000. The final maturity dates for these loans range from February 1, 2005 to July 1, 2009.

The Company has been authorized by its Board of Directors to repurchase up to 4,500,000 shares of its outstanding common stock. As of September 30, 2000, the Company had purchased a total of 3,735,398 shares at a total cost of
$22,715,000.

At September 30, 2000, the Company had two hotels under construction, one of which opened onNovember 1, 2000. The second hotel is expected to open during the first half of 2001. The Company had also begun development of
a third hotel which is expected to open during the second half of 2001. The Company expects that the costs of constructing these hotels will be substantially provided by proceeds of the term loan described above and by construction loans.

In the future, the Company expects its cash requirements to be met by funds generated from operations, sales of its hotel properties, construction loans made to build out certain of its unimproved sites and borrowings under its bank
line of credit.

Certain Risk Factors

In evaluating the Company and its prospects, certain risks, including those described in this section and those listed under "Forward Looking Statements" below, should be considered. Such risks are not the only ones the Company
faces. Additionally, some risks that are not currently known and others that the Company does not consider material could later turn out to be so.

During 1999, in the face of substantial tightening of public and private sources of funding for hotel construction, the Company determined that it would focus its growth plans on franchising. Prior to that time, the Company had focused
on developing and operating its own Suburban Lodge extended stay hotels. Because the operating characteristics of these hotels were so strong, several developers and operators had also opened a total of 30 Suburban Lodge extended stay hotel franchises
through December 31, 1998.

In order to begin executing its strategy, the Company acquired a nightly-stay hotel brand (GuestHouse International) and increased its sales force from one franchise sales director at May 31, 1999, to fifteen by the end of that year.

The Company's target is for each sales director to produce new franchising contracts that result in the opening of an average of four to five hotels per sales director per year. However, the franchise business is highly competitive
and, particularly with respect to the Suburban Lodge brand, which consists almost entirely of newly-constructed hotels, is subject to the availability of substantial bank credit in the form of construction loans that convert to permanent financing.

In the quarter ended September 30, 2000, nine franchised hotels (all GuestHouse International franchises) opened. This was the Company's best quarter with respect to franchise openings, but it was still short of the targeted pace
described in the preceding paragraph. The Company expects to open approximately twelve franchised hotels in the fourth quarter of 2000, three of which would be Suburban Lodge extended stay hotels. While the Company can provide no assurance that all of
these hotels will be opened or converted to its brands by December 31, 2000, and while fourth quarter 2000 activity is not necessarily indicative of future activity, this pace nonetheless indicates that the Company's franchise sales directors are moving
closer to achieving the Company's targeted growth rate.

The Company has also determined that, as its franchising revenues increase, it will sell its own operating hotels with a long-range objective of owning no real estate. The Company's present intent is to sell its hotels only to parties
who are interested in entering into a franchise agreement and operating the hotels under the Suburban Lodge brand.

To date, one sale of a Company-developed hotel has occurred. This was in February 1999 and it resulted in a gain of $1.1 million dollars. Many factors influence the selling price of real estate assets, the most important of which are
operating results for the most recent twelve-month period prior to the sale and the current interest rate environment for hotel loans. Accordingly, the Company cannot predict its ability to sell its hotels nor can it be assured that future hotel sales
will result in recorded gains.

In the fall of 1999, the Company licensed to HotelTools, Inc. the use of its proprietary hotel management and reservation systems, and at that time HotelTools assumed the costs of the continued maintenance and development of these
systems. HotelTools intends to market the fully developed systems, including an eCommerce procurement system, to hotel owners and operators, including Suburban Lodges. The Chief Executive Officer and sole shareholder of HotelTools, Inc. is Seth Christian,
the former Vice President of Operations of Suburban Lodges of America, Inc. Officers of the Company own options pursuant to which they are entitled to acquire common stock of HotelTools, Inc.

To date, all funding for HotelTools' operations has been provided, in the form of secured loans, by the Company. As of the September 30, 2000, the Company had loaned HotelTools, Inc. $6,125,000, and, if no additional funding is secured
by HotelTools, the Company expects that its loans will aggregate approximately $8.2 million by December 31, 2000. The Company anticipates that, in the absence of funding from third parties, it will continue to make loans to HotelTools through June 30,
2001. The loans are payable on demand, and bear interest at an annual rate of 7.0%. In exchange for its financial support, the Company received from HotelTools, Inc. a stock purchase warrant to purchase up to 20 million shares of the common stock of
HotelTools at a nominal cost. Although such shares would constitute in excess of 99% of the equity of HotelTools based on its present capitalization, HotelTools is actively seeking equity investors, and it is expected that the Company's potential
ownership through the exercise of its warrant will be reduced if such additional equity funding can be secured. In the event HotelTools is unable to repay the loans, the Company would recognize a loss up to the full amount of its loans. The Company would seek to minimize any such loss by exercising its security rights against HotelTools'
developed software and its owned hardware. However, there can be no assurance that these assets would have a substantial value to the Company if such events were to transpire.

The Company is a guarantor on an equipment lease for HotelTools. The lease is a financing lease on $1.0 million of equipment previously purchased by HotelTools and $0.2 million of equipment on order. The total amount of the lease
obligation is $1.4 million. The Company anticipates that HotelTools will use approximately $1.1 million of the proceeds from this lease financing to repay a portion of the notes payable to the Company.

Recent Accounting Pronouncements

In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), which was modified by SFAS No. 137,
"Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133." SFAS 133 requires that an entity recognize all derivatives as either assets or liabilities in the balance sheet and measure those
instruments at fair value. The Company plans to adopt SFAS 133 beginning in the first quarter of 2001, and does not presently expect such adoption to have any effect on the Company's financial statements at that time.

In 1999, the Securities and Exchange Commission's staff issued Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial Statements." SAB No. 101 provides guidance on revenue recognition. The Company believes that
SAB No. 101 will have no impact on its current revenue recognition policies.

Forward Looking Statements

Certain statements in this Quarterly Report on Form 10-Q constitute "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are generally identified
by words such as "expects," "believes," "anticipates," etc., and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performances or achievements of the Company to be materially different from the
expectation expressed or implied in such statements. Such factors include, among other things, uncertainty as to economic conditions and interest rates, consumer demand for extended stay and other forms of lodging, the level of competition in the extended
stay and other lodging markets, financial markets, development efficiencies, weather delays, zoning delays, the Company's financial condition, and its ability to maintain operational and financial systems to manage the rapid growth it has experienced.



ITEM 3.          QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to changes in interest rates primarily as a result of its borrowing activities.

At September 30, 2000, the Company had total debt outstanding of $115.8 million. Approximately $100.1 million of this amount was represented by fixed rate mortgage loans. The interest rates on approximately $9.9 million of these
mortgage loans are adjustable on April 1, 2002 and again on April 1, 2005 for $6.8 million of the loans. One loan of approximately $3.1 million matures on April 1, 2005. The interest rate on approximately $2.6 million of the loans is adjustable every year
on April 1.

Outstanding borrowings on three construction loans totaled $5.7 million at September 30, 2000. The Company expects to draw an additional $6.7 million on these loans by the end of the second quarter of 2001. One of the construction
loans with a balance of $3.1 million at September 30, 2000 has a fixed interest rate that is adjustable on October 1, 2002 and again on October 1, 2005. The other two loans are at variable interest rates. The remaining $10.0 million of debt outstanding at
September 30, 2000 was represented by a variable rate term loan with SouthTrust Bank.

The total amount of variable rate debt and fixed rate debt adjustable within one year outstanding at September 30, 2000, plus the additional draws expected to be made on these loans through the end of the second quarter of 2001, is
approximately $20.6 million. Accordingly, each one percent change in market interest rates will change interest expense by approximately $206,000 on an annual basis.

The Company's cash and cash equivalents are short-term and highly-liquid investments with original maturities of three months or less. Accordingly, a change in market interest rates has a nearly immediate effect on interest earned by
the Company on its invested cash. For the foreseeable future, the Company reasonably expects that its average invested cash balance will approximate $5 million. Accordingly, each one percent change in market interest rates will change interest income by
approximately $50,000 on an annual basis.





|PART    | II.                              | OTHER INFORMATION AND SIGNATURES               
|------- | -------------------------------- | -----------------------------------------------
|        |                                  |                                                
|Item 1. | Legal Proceedings               
|        |                                  |                                                
|        | None                             |                                                
|        |                                  |                                                
|Item 6. | Exhibits and Reports on Form 8-K
|        |                                  |                                                
|        | (a)                              | Exhibits                                       
|        |                                  |                                                
|        |                                  | 27 - Financial Data Schedule (For SEC use only)
|        |                                  |                                                
|        | (b)                              | Reports on Form 8-K                            
|        |                                  |                                                
|        |                                  | None                                           



Signatures



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





|                        | Suburban Lodges of America, Inc.          
|----------------------- | ------------------------------------------
|                        |                                           
|                        |                                           
|                        |                                           
|Date: November 13, 2000 | By:/s/ PAUL A. CRISCILLIS, JR.            
|                        | Paul A. Criscillis, Jr.                   
|                        | Vice President and Chief Financial Officer
|                        |                                           
|                        |                                           
|Date: November 13, 2000 | By:   /s/ ROBERT E. SCHNELLE              
|                        | Robert E. Schnelle                        
|                        | Vice President and Treasurer              
|                        | (Chief Accounting Officer)                
|                        |                                           
|                        |