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CNL Hospitality Properties, Inc. and KSL Recreation Corporation
Acquiring Hotel del Coronado from Lowe Enterprises
Investment Management
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Coronado, CA – October 17, 2003 - Lowe Enterprises Investment Management, LLC has entered into a purchase and sale agreement with a partnership between CNL Hospitality Properties, Inc. (“CNL”) and KSL Recreation Corporation (“KSL”) for the sale of the legendary Hotel del Coronado to CNL and KSL. The historic 688-room resort, built in 1888, is situated along 31 beachfront acres on the island of Coronado in San Diego.

Since acquiring the property on behalf of one of its pension fund clients in 1997, Lowe Enterprises, a Southern California based company, and Destination Hotels and Resorts (DH&R), its management subsidiary, have contributed to the future of this historic property. Their commitment to preservation is evidenced by a $55 million restoration, completed in June 2001, which included aesthetic enhancements and the structural reinforcement of the Victorian landmark. 

CNL, one of the lodging industry’s top acquirers of hotels, is expected to own a majority interest in the partnership. KSL, one of the nation’s leading owners and operators of luxury destination resorts, is expected to operate the hotel under a long-term management agreement and hold a minority interest in the partnership.

Once the transaction is consummated, the addition of the Hotel del Coronado will bring CNL’s portfolio to 127 hotels in 37 states with more than 27,000 rooms with 19 nationally recognized hotel brands. Other destination resorts in CNL’s portfolio include the 950-room JW Marriott Desert Ridge Resort & Spa in Phoenix, the 1,310-room Waikiki Marriott Beach Resort and the 428-room Hilton Tucson El Conquistador Golf & Tennis Resort.

The acquisition of the Hotel del Coronado from Lowe Enterprises is subject to customary closing conditions. There can be no assurance that all of the closing conditions will be satisfied. 

Los-Angeles-based Lowe Enterprises, Inc. is a diversified, national real estate investment, development and management company. During its over 30 year history, the company has acquired, developed or managed over $6 billion in real estate assets nationwide. The firm's investment activities are managed through Lowe Enterprises Investment Management, which has acquired over $3.5 billion of commercial, residential, and hospitality assets on behalf of its pension fund clients during the last ten years. For more information, visit http://www.loweenterprises.com. Destination Hotels & Resorts (DH&R) is the firm’s hospitality management subsidiary. DH&R is one of the largest independent lodging management companies in the United States operating 24 independent, luxury and upscale hotels, resorts and golf clubs in the United States, featuring more than 6,400 guest rooms, 15 golf courses and eight full-service spas. 

CNL Hospitality Properties, Inc., an affiliate of CNL Financial Group, Inc., is a leading real estate investment trust in the lodging industry and specializes in investing in quality hotels and resorts. Headquartered in Orlando, Florida, CNL Financial Group, Inc. is one of the nation’s largest, privately held real estate investment and finance companies. CNL Financial Group, Inc. and the entities it has formed or acquired have over $8 billion in assets, representing more than 3,000 properties in 49 states. For additional information, please visit www.cnlonline.com.

KSL Recreation Corporation is a La Quinta, California-based owner and operator of La Quinta Resort & Club and PGA West in La Quinta, California; The Claremont Resort & Spa in Berkeley, California; La Costa Resort & Spa in Carlsbad, California; The Arizona Biltmore Resort & Spa in Phoenix, Arizona; Doral Golf Resort and Spa in Miami, Florida; Grand Wailea Resort Hotel & Spa on Maui; and Lake Lanier Islands Resort near Atlanta, Georgia.

Certain statements and information included in this release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. 

Contact:
Jann Diehl
Lowe Enterprises
(310) 571-4250

Lauren Harris
CNL Real Estate Services, Inc.
 (407) 650-1205

Kristiana Nelson
KSL Recreation Corporation
  (760) 564-8036

Also See: Hotel Investment Market Relatively Strong; Helped by Low Interest Rates and the Availability of Capital / July 2003
Ohio Public Employees Retirement System's Most Valuable Single Real-estate Holding is the Hotel del Coronado, Also Owns the Argent Hotel in San Francisco / October 2003
Craig Jacobs Named General Manager at the Hotel del Coronado / April 2003


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