| TORONTO, Dec. 22, 2004 - Fairmont Hotels & Resorts Inc. (Fairmont)
(TSX/NYSE: FHR), Kingdom Hotels International (Kingdom) and Bank of Scotland
Corporate, a division of HBOS plc announced today that they have formed
a joint venture to invest in luxury hotels in key European markets.
The joint venture will have a potential buying capacity of pnds stlg
800 million (US$1.5 billion) and will be equity funded 50% by Bank of Scotland,
25% by Fairmont and 25% by Kingdom. The partners anticipate making equity
contributions of up to pnds stlg 200 million (US$390 million). The
hotels acquired by the joint venture will be managed by Fairmont and Bank
of Scotland will provide debt financing for the joint venture. Cedar Capital
Partners will serve as managers and investment advisors for the joint venture.
 The
joint venture's first investment is the purchase of the Monte Carlo Grand
hotel in Monaco, a 619-room landmark property on one of the most coveted
stretches of the Côte d'Azur. The purchase of the hotel by the joint
venture has been completed and the property will be flagged "The Fairmont
Monte Carlo" in March 2005. The new owners expect to invest US$50 million
in refurbishment.
"We are delighted to extend our relationship with Kingdom and Bank of
Scotland through this joint venture," said William R. Fatt, CEO Fairmont
Hotels & Resorts. "Coming on the heels of our agreement to manage London's
Savoy Hotel on completion of sale, this agreement marks another important
milestone in the global expansion of the Fairmont brand and adds Monte
Carlo to our list of world renowned Fairmont hotel destinations."
"As a long-term investor in Fairmont and Fairmont hotel properties,
we believe our joint venture's focus on European luxury hotel acquisitions
is an excellent strategic choice for growth," said HRH Prince Alwaleed
bin Talal bin AbdulAziz Alsaud, Chairman of Kingdom.
Peter Cummings, Managing Director Bank of Scotland Corporate added,
"We are very confident in the expertise and capacity of our joint venture
partners to command a strong presence in Europe and develop the properties
acquired to the very highest standards of quality and financial performance."
About the Monte Carlo Grand Hotel
Designed to echo the sleek elegance of an ocean liner and architecturally
avant garde since it opened in 1975, this modern palace hotel hugs the
coastline directly below the famous casino. One of Europe's best-known
and largest convention resorts, the Monte Carlo Grand contains 32,300 feet
of premium function space along with five restaurants and bars, a spa,
an outdoor pool with sea views and a newly renovated Fitness Center. The
hotel's 619 rooms offer expansive views of the principality and the Mediterranean.
About Kingdom
Kingdom is owned by a trust for the benefit of HRH Prince Alwaleed
bin Talal bin AbdulAziz Alsaud and his family. Prince Alwaleed, directly
or through trusts and other entities for the benefit of himself and his
family, has made substantial investments in multiple sectors including
banking, hotels, media, telecommunications, technology, construction and
real estate, entertainment, and upscale fashion, among numerous others.
Significant hotel-related investments include interests in Fairmont Hotels
& Resorts, Four Seasons Hotels & Resorts, the George V Hotel and
Movenpick Hotels & Resorts, covering more than 260 hotels throughout
the US, the Middle East and Africa. Significant investments in other
sectors include interests in Citigroup, News Corp., Time Warner, Motorola,
Apple Computers, Ballast Nedam, Canary Wharf, Disneyland Paris, Saks Inc.
and Kingdom Center.
About Bank of Scotland Corporate
Bank of Scotland Corporate is part of leading UK financial services
group, HBOS plc. It has a reputation for excellence in the provision of
corporate finance, delivering innovative funding solutions across a range
of markets. The Bank has established a strong record in funding Joint Ventures.
Since setting up its Joint Ventures team in 2000, it has provided total
funding of over pnds stlg 10 billion across more than 130 investments.
Typically, the Bank invests in vertical (integrated) funding opportunities
(i.e. debt plus equity) and weighty equity stakes (typically 25-50%) with
the Bank being pro-active in driving value.
About Cedar Capital Partners
Cedar Capital Partners is a specialist hotel investment firm that invests
and asset manages equity capital on behalf of institutions and high net
worth individuals on a global basis. The firm was founded by Ramsey Mankarious
and is comprised of industry professionals with backgrounds in hotel finance,
operation, acquisition and development.
About Fairmont Hotels & Resorts Inc. (Fairmont)
Fairmont is one of North America's leading owner/operators of luxury
hotels and resorts. Fairmont's managed portfolio consists of 81 luxury
and first-class properties with approximately 33,000 guestrooms in the
United States, Canada, Mexico, Bermuda, Barbados and the United Arab Emirates.
Fairmont owns Fairmont Hotels Inc., North America's largest luxury hotel
management company, as measured by rooms under management, with 44 distinctive
city center and resort hotels such as The Fairmont San Francisco, The Fairmont
Banff Springs and The Fairmont Scottsdale Princess. Fairmont also owns
Delta Hotels, Canada's largest first-class hotel management company, which
manages and franchises 37 city center and resort properties in Canada.
In addition to hotel management, Fairmont holds real estate interests in
22 properties and an approximate 24% investment interest in Legacy Hotels
Real Estate Investment Trust, which owns 24 properties.
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