HFS Gives Preferred Vendor Program New Name To ReflectCompany's Evolving Business.

PARSIPPANY, N.J.--(BUSINESS WIRE)--Jan. 8, 1997--

-Change Comes at End of Milestone Year-

HFS Incorporated announced today that its Preferred Vendor Program has been renamed the "Preferred Alliance Program." The decision to rebrand the HFS program was based on the need

The Preferred Alliance Program (SM) has just finished a successful 1996, with 27 new agreements signed this year and an aggregate of 70 HFS preferred alliances negotiated since the program's inception four years ago. With nearly a 100 percent retention rate, and recent additions like industry powerhouses Aon, the Money Store and Polaroid, the program has proven to be an unequivocal success across the board for vendors, franchisees and HFS brands.

Commenting on the program HFS Vice Chairman, President and Chief operating Officer John Snodgrass said: "We are very pleased by the pace at which the program has grown. In 1992, the first year of the program, HFS had only two programs in place. Today, we have 70 alliances with the top product and service providers in the world and are very optimistic about the program's continued and rapid growth."

John Chidsey, senior vice president, Preferred Alliance Services(SM), said of the program's evolution: "The new `Preferred Alliance' name better reflects the cross-marketing activities and internal synergies on which HFS' growth is focused. We look forward to crafting new alliances in 1997 that will benefit not only our hotel and real estate businesses but our newly acquired car rental, timeshare exchange and relocation businesses as well."

The alliances are designed not only to save money for HFS franchisees and their customers, but also to generate additional income for industry-leading vendors who can consolidate a large part of their marketing efforts through HFS. The company's 1996 acquisitions in new industries beyond its core real estate, hospitality and relocation businesses -- including its purchase of Avis, Inc., Resort Condominiums International, Inc., and its pending merger with PHH Corporation (NYSE:PHH) -- mean that the program still has abundant untapped potential.

Many current HFS hotel and real estate franchisees see the Preferred Alliance Program as one of the most compelling reasons for franchising with the company.

"These alliances are truly `win-win-win' relationships all the way around," said HFS real estate broker/owner Steve Krawse of Century 21 Stephens in New Jersey. "The franchisor, franchisee and consumer all benefit. For example, the HFS preferred alliance with ADT allows Century 21(R) home buyers to receive preferred pricing on their home security systems. At the same time, the preferred alliance with IBM offers Century 21 sales associates a good deal on IBM laptop computers. Meanwhile, the program gives HFS a great vehicle to differentiate the value it provides franchisees from what its competitors offer."

Larry Horwitz, president of Northwest Lodging, which owns eleven Ramada hotels and seven Howard Johnson hotels, commented: "The reality is that a company our size cannot have anywhere near the negotiating clout that HFS does through its Preferred Alliance Services group. And that strength has meant bottom line savings that makes Northwest lodging properties more profitable. In 1996, HFS' preferred relationship with Aon Risk Services alone saved my company $103,000."

The Preferred Alliance Program has been a success from the vendor's vantage point as well. Companies like Black & Decker(R), Pizza Hut(R), IBM(R), Visa and AT&T(R) have all gained preferred access to HFS' 20,000 outlets worldwide. These outlets represent some 500,000 hotel rooms, 160,000 real estate brokers and agents, and 4,000 car rental offices -- all reaching about 210 million consumers a year.

"Through the Preferred Alliance Program, HFS lends us the advantage of the company's own unique relationship with its franchisees," said Dennis Lewis, AT&T Vice President, Global Services. "When we meet with a member of the HFS franchise community, we are treated as part of that community. The emphasis HFS puts on mutual benefit provides an excellent environment for doing business."

Michael Prins, CEO of Aon Risk Services of Minnesota,one of the largest insurance brokerage companies in the world, added: "since Aon initiated its agreement with HFS, we have seen a threefold increase in business. Particularly at a time when HFS is strengthening its position in the real estate and mortgage banking sectors, Aon is very excited with continuing this mutually profitable alliance with HFS."

HFS Incorporated is a global consumer services company. The company is the largest franchisor of hotels and residential real estate brokerage offices, owns Avis, Inc., the world's second largest rental car system, and owns Resort Condominiums International,Inc., the largest provider of vacation timeshare exchanges worldwide. The company recently announced a definitive merger agreement with PHH Corporation, expected to close during the first quarter of 1997.

CONTACT: HFS Incorporated

Jane Baxter Lynn, 201/952-8414