The spectacular 225-acre parcel is on the shores of the Pacific Ocean located across from the Ritz Carlton Laguna Niguel Hotel and includes the Monarch Beach Links golf course as well as a residential resort parcel. CPH plans to develop a five-star luxury residential resort and spa on the newly acquired property, which would potentially include a 400-room hotel and spa, 238 luxury residences, and the expansion of the existing Monarch Beach Golf Links to a par 72 championship course. As part of its purchase, CPH also acquired the well known Monarch Beach Club, a private beach club located directly on the sands of Monarch Beach.

The Company's development plans for the newly acquired property closely follow those approved by the City of Dana Point in 1991. The proposed 400-room five-star hotel and spa will be built on approximately 16.4 acres, with total floor area at this time estimated at 498,000 square feet. It is currently expected to consist of approximately 310,000 square feet of guest rooms and corridors, 8,000 square feet of high-end retail shops, 15,000 square feet of hotel guest amenities and recreational facilities, 15,000 square feet of food and beverage areas, as well as 38,000 square feet designated for meeting and banquet facilities.

On Tuesday, July 14, 1998, the City of Dana Point agreed to extend for one year the previously approved tentative map for the area. Accordingly, CPH plans to work with the city in implementing the project which should provide both the city and the surrounding community significant benefits in the form of both bedroom tax revenues, and additional sales tax revenues.

"We are very grateful for the careful consideration and cooperation that we have received from the Dana Point City Council. We are also very grateful to the local residents of Monarch Beach and Dana Point who have shown their continued support for the project and who supported our application and the efforts of our colleagues, specifically Tim Hamilton and Oliver Cagle, who cooperated with the community towards renewing the existing entitlements," said Hadi Makarechian, Chairman and CEO of CPH. "We are looking forward to working closely with the city to design and build a spectacular five-star destination resort and residential community. We hope our efforts will not only make the residents and the community proud, but will also establish the City of Dana Point as the premier luxury resort and residential destination of the West Coast."

Along with its acquisition of the Monarch Beach Resort property, CPH agreed to a potential joint venture with Patriot American Hospitality Corporation, a $7 billion publicly traded upscale hotel company, which owns and operates over 100,000 hotel rooms that include: Grand Bay Hotels and Resorts, the five-star Boulders resort in Scottsdale, the prestigious Golden Door Spa, Wyndham Hotel Resorts, and the five-star Peaks Resort in Telluride, Colorado, as well as many others. Under the potential joint venture, CPH will construct the hotel on the Monarch Beach property, but will own and operate it in partnership with Patriot American. "With our experience as developers of high-end communities and with Patriot American's expertise in the development and operation of five-star hotels and resorts, we are extremely excited and look forward to a successful fruition of this magnificent project," added Makarechian.

At the Dana Point City Council meeting, CPH projected that the partnership would probably invest approximately $400 million into the project. The closing of the transaction concludes a prolonged seven-year period during which this magnificent piece of the California coastline sat dormant, largely as a result of both the real estate recession and the absentee ownership of Nippon Shinpan.

The spectacular parcel is immediately adjacent to a 16.24-acre ocean view parcel known as "Ritz Pointe," which CPH acquired two weeks ago for $25 million and intends to develop into additional 65 high-end estate homes.

CPH's purchase of Monarch Beach increases its recent acquisitions of coastal properties in Southern California to over $200 million, and brings its projected development cost for these properties to multiples of that figure. These holdings include acquisitions in such luxurious areas as Newport Coast, Monarch Beach, Dana Point, Rancho Palos Verdes, and Huntington Beach.

The new acquisition contributes to the Company's list of recent coastal and commercial purchases. Among CPH's most recent acquisitions are:
 
 

CPH is also moving forward on plans for its grand opening of "Oceanfront Estates at Rancho Palos Verdes." This 132-acre parcel is located high on a bluff overlooking the Pacific Ocean and the famous whale watching site in Palos Verdes. The Company currently plans to develop 79 luxury estate homes ranging in size up to 8,000 square feet on 1/2 to 3/4-acre ocean view lots. These homes are expected to be priced from $1.5 million.

Capital Pacific Holdings, Inc., is a Newport Beach-based real estate development and holding company, with operations in California, Nevada, Arizona and Texas. CPH is a publicly traded company (Amex: CPH), and can be accessed on the Internet at http://www.cph-inc.com.