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ARLINGTON, Va. -- Interstate Hotels & Resorts (NYSE: IHR), the nation's largest independent hotel management company, today announced that it has acquired Sunstone Hotel Properties, Inc., the manager of 54 hotels, including 50 hotels owned by Sunstone Hotel Investors, Inc. (NYSE: SHO), a newly formed real estate investment trust (REIT).
The two companies had announced earlier that Interstate would acquire the company upon the REIT successfully completing its initial public offering, which occurred October 26, 2004. Publicly traded REITs are required by law to have their hotels managed by third-party operators.
Sunstone's senior operating team will become part of Interstate's operating team and will remain in their existing San Clemente, Calif. offices. No personnel changes are anticipated in the organization or at the hotels, and the transaction is expected to be essentially transparent to current Sunstone hotel employees.
"Sunstone's properties fit well with our existing portfolio of managed hotels," said Steve Jorns, Interstate's chief executive officer. "In addition, we look forward to expanding our relationship with Sunstone as the company acquires new properties."
The 54 hotels comprise 12,643 rooms in 16 states and are primarily upper-upscale and upscale properties located in the Western portion of the country. The hotels include 24 Marriott-branded hotels, 16 InterContinental-branded hotels, eight Hilton-branded hotels and three independent hotels. With the addition of this portfolio, Interstate now operates 307 hotels.
"While we have had a West Coast presence, this transaction enhances our already significant economies of scale, enabling us to operate even more effectively and efficiently," Jorns noted.
Sunstone Hotel Investors, Inc. is a Southern California-based real estate investment trust that owns 54 primarily upper-upscale and upscale hotels in the United States.
Interstate Hotels & Resorts operates more than 300 hospitality properties with nearly 70,000 rooms in 40 states, the District of Columbia, Canada, Russia, and Portugal. BridgeStreet Corporate Housing Worldwide, an Interstate Hotels & Resorts' subsidiary, is one of the world's largest corporate housing providers. BridgeStreet and its network of Global Partners offer more than 8,700 corporate apartments located in 91 MSAs throughout the United States and internationally. For more information about Interstate Hotels & Resorts, visit the company's Web site: www.ihrco.com.
This press release contains "forward-looking statements," within the meaning of the Private Securities Litigation Reform Act of 1995, about Interstate Hotels & Resorts, including those statements regarding future operating results and the timing and composition of revenues, among others, and statements containing words such as "expects," "believes" or "will," which indicate that those statements are forward-looking. Except for historical information, the matters discussed in this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause the actual results to differ materially, including changes in the national economy, economic conditions generally and the real estate market specifically, the threat of future terrorist attacks, governmental actions, legislative and regulatory changes, availability of debt and equity capital, interest rates, competition, supply and demand for lodging facilities in our current and proposed market areas, and the company's ability to manage integration and growth. Additional risks are discussed in Interstate Hotels & Resorts' filings with the Securities and Exchange Commission, including Interstate Hotels & Resorts annual report on Form 10-K for the year ended December 31, 2003.
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