Ashford Completes Acquisition of 51-Hotel Portfolio

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. October 14, 2008

APRIL 13, 2007.

Acquisition Highlights:

---|Comprised of 24 full-service, upper-upscale hotels and 27 premium select-service hotels in 31 markets across 18 states, the District of Columbia and Canada

---|Increases portfolio allocation in premium branded upper-upscale assets in major metropolitan and coastal markets with above average RevPAR growth potential

---|Acquisition price implies a projected forward 12-month NOI cap rate of approximately 7.6% and an estimated forward EBITDA yield of 9.0%

---|Price per key of approximately $215,000 for full service hotels and $125,000 for select service hotels

---|High quality assets include: Marriott Seattle Waterfront, Capital Hilton, Hilton Costa Mesa, Hyatt Regency Montreal, Hilton Tucson El Conquistador, Marriott Legacy Center, Renaissance Tampa, and Hilton La Jolla Torrey Pines.

Ashford Hospitality Trust, Inc. (NYSE: AHT) announced it has completed the acquisition of a 51-hotel, 13,640-room (net after joint venture adjustment) hotel portfolio from CNL Hotels and Resorts for approximately $2.4 billion in total consideration ($177,000 per key).

Monty J. Bennett, President and CEO of Ashford Hospitality Trust, said, "This portfolio is an unparalleled investment opportunity and transformational event for Ashford. This accretive transaction concentrates our portfolio in major metropolitan and coastal markets with largely upper-upscale brands, while providing us with a larger platform to execute our portfolio management and internal growth strategies.

"To ensure that we extract the maximum value from this transaction, for the last several months we focused on integration efforts, fine-tuning the financing, implementing value-added asset management strategies and deleveraging our balance sheet. The transition will be smooth with the added staff mainly in our accounting and asset management areas, and we anticipate being at the lower end of the $12-16 million range we had previously projected for our incremental G&A. Continuous negotiations on the financing resulted in even more flexible terms and lower costs. We made substantial progress on several value added strategies including JV buyouts and refinancing along with restructuring of management agreements to increase EBITDA. We are well on our way to accomplishing our deleveraging goals with planned asset sales totaling approximately $570 million in two phases and potential joint venture discussions."

Transaction Pricing

The estimated forward NOI cap rate is 7.6% and the EBITDA yield is 9.0% resulting in an 11.1x EBITDA multiple. On a trailing 12-month basis, the transaction's NOI cap rate is 7.0% with an EBITDA yield of 8.4% equating to an 11.9x EBITDA multiple.

Transaction Funding

The transaction was funded with the following sources, all of which with the exception of assumed debt were provided by Wachovia Securities: $928.5 million of 10-year fixed CMBS at 5.95%; assumed debt from the existing joint ventures of approximately $436.9 million at an average interest rate of 6.08%; a $555.1 million pool of floating-rate CMBS at 165 basis points over LIBOR; $200 million of preferred equity at 250 basis points over LIBOR; a one-year (with 2 year extension), $325 million term loan at a rate of 150 basis points over LIBOR; and a three-year $200 million revolver that is priced between 155 to 195 basis point over LIBOR depending on the loan-to-value ratio. The blended all-in cost of capital on this financing is 6.49%.

Portfolio

The portfolio is comprised of full-service, upper-upscale hotels that account for approximately 65% of trailing EBITDA and premium select-service hotels totaling approximately 35% of trailing EBITDA. The 24 full-service, upper-upscale hotels contain 8,069 rooms with such hotels as the Marriott Seattle Waterfront, Marriott Legacy Center, Renaissance Tampa, Hyatt Regency Montreal, Hilton Tucson El Conquistador, Hilton La Jolla Torrey Pines, Hilton Costa Mesa, and Capital Hilton. The balance of the portfolio is comprised of 27 premium select-service hotels totaling 5,571 rooms. The well maintained hotels in the portfolio have an average age of 14.5 years. For 2006, the portfolio's RevPAR was $99.51, resulting in a portfolio wide RevPAR yield penetration of approximately 116%. The 2006 ADR of $138 exceeds Ashford's existing portfolio by 14%. The portfolio generated Gross Revenues of $689 million in 2006.

The transaction further concentrates Ashford's overall portfolio EBITDA in higher growth markets and solidifies its position in the upper-upscale and upscale chain segments with 60% upper-upscale, 35% upscale, 4% midscale and 1% luxury pro forma for the acquisition. Ashford's portfolio EBITDA by brand now includes the industry's strongest performers with 50% in the Marriott brand family, 31% in Hilton, 8% in Hyatt and 6% in Starwood. Geographic diversification by EBITDA is also enhanced with 35% South Atlantic (of which 44% is in the Washington, D.C. area), 25% Pacific, 11% North Central, 10% South Central, 9% Mid-Atlantic, 7% Mountain, 2% New England and 1% Canada.

All but five of the 51 hotels are managed by their respective brands under long-term contracts. On a combined basis, Ashford has a total of eight different property managers with the largest being Marriott at 45% of the overall portfolio EBITDA, Remington Hotels at 22%, Hilton at 18% and Hyatt at 8%. Seventeen hotels in the acquisition are owned in joint ventures with ownership interests ranging from 70% to 89%.

Capital Expenditure Plan

Ashford expects to invest approximately $55 million in owner funded valued added capital improvements above the normal reserves for these assets in the first year to improve the physical product of the hotels and further enhance RevPAR yield penetration.

Ashford Hospitality Trust is a self-administered real estate investment trust focused on investing in the hospitality industry across all segments and at all levels of the capital structure, including direct hotel investments, first mortgages, mezzanine loans and sale-leaseback transactions. Additional information can be found on the Company's web site at www.ahtreit.com.