NEW YORK - Mention Red Roof Inn, and chances are consumers picture a hotel in rural America. However, a different kind of Red Roof Inn is opening in Manhattan - a 17-story, 171-room boutique-style hotel near Fifth Avenue. Slated to open this month, the hotel is owned by New York-based Apple Core Hotels and franchised by Columbus, Ohio-based Red Roof Inn Inc. Having opened four other hotels in the city over the past three years, Apple Core Hotels is no stranger to the Big Apple.

Apple Core Hotels searches the city for older buildings that can be converted into hotels. In the past, that usually meant repairing dilapidated hotels or rooming-house properties. This time, the company chose a more ambitious project - converting a former office building.

Located at 6 West 32nd St. west of Fifth Avenue, the building was acquired and renovated for $23 million. Apple Core Hotels' strategy of renovating hotels has worked for the company primarily because it is less expensive, says Apple Core COO Vijay Dandapani. The lower construction cost enables the company to open mid-price hotels in the city, which is uncommon for that market, he says.

"This has been a gratifying project on a simple level," says Dandapani, noting that the building had all the ingredients he looks for in a renovation project, including a strong structural frame, good ventilation, and a reasonable price for acquisition and renovation. "If it doesn't make sense for us on a per-room cost basis, we won't do the project," he says.

A high ceiling at the building's entrance enabled Potomac, Md.-based architect HK International Design to put in a mezzanine lounge overlooking the lobby. The hotel also features a glass-enclosed rooftop bar.

The Red Roof Inn flag is a first for Manhattan, and Dandapani thinks the name will attract business travelers who are more accustomed to staying in mid-market hotels. "These hotels have a wide range of customer acceptance," he says.

"I'm interested in volume generation by the franchise, and I think we'll succeed here," adds Dandapani.

Although Apple Core considered opening hotels in other cities such as Boston and Washington, D.C., it has decided to concentrate on New York because the company has achieved occupancy rates of more than 90% in its Manhattan properties.

"[New York] is the best lodging market in this country," he says, noting that the company is searching for new projects to develop in Manhattan. "It's really a function of the economy. If the economy continues to be stable, then we'll do two more projects in New York in the next two to three years."

Apple Core's other Manhattan properties include the Comfort Inn Midtown, Quality Hotel & Suites Midtown, Best Western Manhattan and the Quality Hotel East Side. The company also owns several hotels in New York, New Jersey and Pennsylvania.