CapStar Hotel Company Completes Acquisition of the Sheraton Fisherman's Wharf in San Francisco.

WASHINGTON--(BUSINESS WIRE)--April 6, 1998--CapStar Hotel Company (NYSE: CHO), a leading hotel investment and management corporation, today announced that it has purchased the 524-room Sheraton Fisherman's Wharf in San Francisco, California, from ITT Sheraton for $84 million. CapStar will invest approximately $5 million to renovate the property.

"This is our second major announcement of a California acquisition in recent months," said Paul Whetsell, CapStar president and CEO. "The Sheraton Fisherman's Wharf is one of San Francisco's premier hotels and will become a flagship property in CapStar's growing portfolio of first-class, full-service hotels and resorts. During the last six months, we have focused on acquiring properties of this caliber in major metropolitan markets and/or gateway cities throughout the U.S., including Chicago, Philadelphia, Washington, D.C., Los Angeles and, now, San Francisco."

Located at 2500 Mason Street, the hotel is a mile from the financial district and is surrounded by many of San Francisco's primary tourist attractions, including San Francisco Bay, Pier 39, Ghiradelli Square and Cannery Row. The property comprises six, four-story buildings connected by breezeways and occupies a full city block. It features concierge and business-class floors, a full-service restaurant, 7,000 square feet of meeting space, an outdoor heated pool and a business center.

Guest rooms are designed for both business and leisure travelers and feature large work desks and two telephones with dataports and voice-mail. Concierge-level rooms have access to a common lounge with complimentary continental breakfast and afternoon cocktails, daily newspaper delivery and nightly turndown service.

The hotel completed a $5 million renovation in 1996 to replace all guest room soft goods and refinish all case goods, install a new telephone system and upgrade the property's exterior. CapStar will spend an additional $5 million to install new exterior windows in all guest rooms and replace all public space soft goods. Plans also include adding a health club, a second concierge-level lounge and a number of upscale design features to the hotel, including a fireplace in the lobby.

"We are pleased to enter one of the world's most vibrant hotel markets with such a pre-eminent property," said David McCaslin, CapStar chief operating officer. "With the hotel's prime waterfront location and planned renovation, we are well-positioned to capitalize on the area's immense popularity with both business and leisure travelers."

Washington, D.C.-based CapStar Hotel Company owns and manages upscale, full-service hotels throughout the U.S. and Canada under such internationally known brands as Hilton, Sheraton, Marriott, Embassy Suites, Westin and Doubletree. CapStar's hotel portfolio, including one under contract, comprises 56 owned hotels with 14,938 rooms and 85 leased or managed with 13,304 rooms for a total of 141 properties with 28,242 rooms. The company continues to actively seek acquisitions and management contracts in major markets and resort locations throughout North America.

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