Construction costs for the condominium tower and attached parking structure will be approximately $100 million.  Construction of the Margate Tower will begin September 1, 2002, with completion scheduled for the third quarter of 2004.  Financing has been received from Bank of America, N.A., and The Bank of Nova Scotia.

The Margate Tower Condominiums will feature 251, two-and-three bedroom units with 80 percent of the units having dens.  The condominiums will range in size from 1,800 to more than 2,700 square feet.  Each unit will feature nine foot ceilings, a free flowing living and entertainment area, gourmet kitchens, large covered balconies, floor to ceiling windows, bathrooms with garden Jacuzzi® tubs and glass enclosed showers.  Approximately 81 percent of the units have been pre-sold to qualified buyers under binding contracts.

�We remain pleased with our investments in the greater Myrtle Beach area, widely known as South Carolina�s Grand Strand,� said Thomas J. Corcoran, Jr., FelCor�s President and CEO.  �Today�s announcement of the Margate Condominium development, and our recent acquisition of the Wyndham Myrtle Beach Resort®, to be converted to a Hilton® hotel, are a testament to FelCor�s value creation strategy, in this case working with Hilton, one of our brand manager alliances.� 

The Margate project site is located next to the Brighton Condominiums.  The Brighton Condominiums, a 200-unit residential condominium development, was developed by FelCor and Hilton Hotels, through a joint venture agreement.  This project was completed and sold in the summer of 2000. 
 

The Margate project site and the Brighton Condominiums are adjacent to the Embassy Suites Hotel® - Kingston Plantation, which is owned by FelCor and managed by Hilton.  The Embassy Suites hotel is part of the 145-acre Kingston Plantation master planned oceanfront resort community that includes freshwater lakes, a rolling wooded terrain, a water activity park, and more than 1,600 feet of ocean frontage.  A FelCor-Hilton joint venture holds the rights for the development of up to an additional 149 residential condominium units.  The 385-room Wyndham Myrtle Beach Resort, which FelCor acquired in July 2002, also is located next to Kingston Plantation.  There is a total of approximately 100,000 square feet of meeting space available through Kingston Plantation and the Wyndham Myrtle Beach Resort.

Kingston Plantation offers a variety of luxurious accommodations, recreation and conference facilities on 145 oceanfront acres at the northern end of Myrtle Beach, South Carolina.

FelCor is the only lodging REIT that owns a diversified portfolio of nationally branded, upscale and full-service hotels managed by strategic brand managers such as Hilton Hotels, Six Continents Hotels, and Starwood Hotels & Resorts.  FelCor is competitively positioned to deliver superior shareholder returns through its strong management team, strategic brand manager alliances, diversified upscale and full-service hotels, value creation expertise, and financial strength.  FelCor�s hotel portfolio consists of 184 hotels with nearly 50,000 rooms and suites and is concentrated primarily in the upscale and full-service segments.  FelCor is the owner of the largest number of Embassy Suites, Crowne Plaza®, Holiday Inn® and independently owned Doubletree®-branded hotels. Other leading hotel brands under which FelCor's hotels are operated include Sheraton Suites®, Sheraton® and Westin®.  FelCor has a current market capitalization of approximately $3.1 billion.  Additional information can be found on the Company's website at www.felcor.com.

With the exception of historical information, the matters discussed in this news release include �forward looking statements� within the meaning of the federal securities laws that are qualified by cautionary statements contained herein and in FelCor's filings with the Securities and Exchange Commission.