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Capital Lodging, a Newly Organized REIT Acquiring
 22 Hotels from Crown Hotel Holding Co.,
Prism Hotels Will Manage Hotels
Pittsburgh Post-Gazette
Knight Ridder/Tribune Business News

May 15, 2004 - The Crown Hotel Holding Co. of Johnstown yesterday said it was selling 22 of its 27 hotels to Capital Lodging, a newly organized hospitality real estate investment trust.

The sale includes five hotels in Pennsylvania, four of them in the Pittsburgh region, including the Wyndham Garden Hotel at University Place in Oakland. Other Pennsylvania hotels to be sold include the Beaver Falls Holiday Inn, the Greensburg Four Points Sheraton, the Uniontown Holiday Inn and the York Holidome & Conference Center.

Purchase prices were withheld. Crown spokeswoman Allison Troy Finui issued a short statement confirming the sale, but declined to elaborate.

In a filing last month with the Securities and Exchange Commission outlining plans to go public, Capital said it was founded by Apollo Real Estate Advisors, whose management includes hotel acquisition veterans and former hotel owner-operators.

Capital said once its IPO is completed, it will own a diversified portfolio of 34 hotels with 6,829 rooms in 13 states. Its chairman is Rick Koenigsberger, an Apollo partner who focuses on the hospitality industry.

The sale of the Crown hotels to Capital is expected to be completed on or around July 9, according to a federal notice Crown filed with the state to warn of pending layoffs. The notice said 577 employees would be "separated" from the company as a result of the sales.

Crown will continue to own and operate five hotels, including two in Johnstown -- the Holiday Inn Downtown and the Holiday Inn Express, the Harrisburg Wyndham Garden Hotel, as well as a Comfort Inn in Macon, Ga., and a Holiday Inn in Rock Hill, S.C.

Crown will maintain a headquarters at Pasquerilla Plaza in Johnstown, where the company will continue to operate and manage the Frank J. Pasquerilla Conference Center.

Employees of the hotels being sold were sent a letter saying that Prism Hotels, a hotel management company that oversees 40 hotels under various brands in the United States and the Caribbean, has agreed to manage the former Crown hotels for Capital after the sale. The letter said all "qualified and willing employees" with be offered jobs with rates of pay that "generally" will remain the same.

Teresa F. Lindeman contributed to this report.)

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(c) 2004, Pittsburgh Post-Gazette. Distributed by Knight Ridder/Tribune Business News.

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