FILED PURSUANT TO RULE 424(B)(3)
                                                   REGISTRATION NUMBER 333-77055

                   STICKER SUPPLEMENT TO SUPPLEMENT NO. 2 DATED OCTOBER 5, 1999;
                                          SUPPLEMENT NO. 2 DATED OCTOBER 5, 1999
                                                      TO BE USED WITH PROSPECTUS
                                                            DATED AUGUST 3, 1999


            SUMMARY OF SUPPLEMENT TO PROSPECTUS DATED AUGUST 3, 1999
                 (SEE THE SUPPLEMENT FOR ADDITIONAL INFORMATION)

Supplement  No.  2 dated October 5, 1999 (incorporating and replacing Supplement
   No. 1):
   (1) Reports  on  our  purchase,  either  directly or through a subsidiary, of
       five  Homewood  Suites(Reg.  TM)  extended-stay  hotels  for an aggregate
       purchase price of $45,300,000
   (2) Reports on the  short-term  financing  of 75% of the  aggregate  purchase
       price,  or  $33,975,000,  secured by the properties and having a maturity
       date of October 1, 2000
   (3) Reports on the manner in which the hotels will be operated  and  managed,
       including a summary of the material contracts affecting these matters
   (4) Reports on the election of our Senior Vice  President and Chief Operating
       Officer
   (5) Provides   certain  other  information  about  us  and the hotels we have
       purchased

          As of August 23, 1999,  we had closed on the sale of  1,666,666.67  of
our common  shares at a price of $9 per share,  representing  completion  of the
minimum offering. As of September 22, 1999, we had closed on the sale of 865,470
of our common shares at a price of $10 per share.  These sales,  when  combined,
represent gross proceeds of $23,654,700, and proceeds net of selling commissions
and marketing expenses of $21,289,230. We are continuing the offering at $10 per
share in accordance with the prospectus.
          We have paid a real estate commission of $906,000,  representing 2% of
the aggregate purchase price for the hotels, to Apple Suites Realty Group, Inc.,
which is our real estate broker and is owned by our Chairman and Chief Executive
Officer.