Meet the Money Conference Attracts Record Attendance of Nearly 400; Hallways Buzzing with Deals.

Business Editors

LOS ANGELES--(BUSINESS WIRE)--May 12, 2004

Meet the Money, the hotel industry's closely-watched conference that provides up-to-the-minute information on industry and lending trends, attracted a record number of participants this year, according to Jim Butler, conference founder and Chairman of the Global Hospitality Group in the law firm, Jeffer Mangels Butler & Marmaro LLP (JMBM). Nearly 400 industry executives came together for the 14th annual event, held recently at the Sheraton Gateway LA Airport Hotel.

"We think the level of attendance, the high energy levels in all the sessions and major networking in the halls are all very strong indicators that 2004 will be a very big year for hotel transactions," Butler said. "I haven't seen this level of optimism and activity in at least four years. More than 70 debt & equity financing sources representing billions of capital were on hand and highly visible on panels and in earnest conversations in the halls."

Echoing that sentiment was William McBain, ISHP, executive vice president of Benjamin West LLP, and Patrick O'Neal, vice president PNC Real Estate/Midland Loan Services, Inc., who said that they had made contacts at the conference that could lead to in excess of 30 projects. "This was by far the most active conference of the past several years," McBain noted.

Significant comments from the conference included:

-- Opening speaker Mark Woodworth, executive vice president of

PKF Consulting, set the stage with a forecast of a 7.9 percent

increase in revenue per available room in 2004 and a 5 percent

increase in 2005. Virtually all speakers were upbeat in their

outlooks for 2004 and 2005. Smith Travel Research's Bobby

Bower forecast low supply growth and record demand levels in

2004.

-- There was a general consensus from all speakers that interest

rates will increase shortly.

-- Lenders expect an increase both in lending volume and loan

delinquencies.

-- There is a shift in hotel pricing with increasing emphasis

placed on 12-month forward estimates, rather than 12-month

trailing actual results.

-- Bruce Wiles, president and COO of MeriStar Hospitality, in

response to a question, recommended that owners of single

assets currently financed at floating rates should probably

lock in longer-term interest rates now.

-- Joe Green, president and CFO of Winston Hotels, noted that

Wall Street currently has significant positive interest in and

support for the hotel industry. "The window is open, and there

are a number of successful IPOs and follow-on offerings in

progress. How long the window remains open, however, is

difficult to predict."

-- Insurance rates that skyrocketed following the September 11

attacks are abating, according to Janice Schnabel, National

Hospitality Practice Leader, Marsh Inc. "Property insurance

rates could decline as much as 10 percent this year," she

noted.

-- Arthur L. Buser, Jr., executive vice president of Jones Lang

LaSalle Hotels, recommended to buyers who have transactions

under contract that they should close as quickly as possible

because sellers are increasingly "re-trading" the price as the

industry rebounds.

-- With lenders becoming more confident in the future, look for

more innovative lending practices.

-- Concerns over rising expenses as hotel occupancies increased

were a concern raised by a number of panels. Asset management

will play an increasingly important role in unlocking hotel

values.

-- Occupancy will continue to improve ahead of room rate,

according to Suzanne Mellen, MAI, CRE, managing director of

HVS International's San Francisco office. "The consumer's

ability to comparison shop on the Internet may moderate rate

rebound," she cautioned. The good news is that rate deflation

in 2001-2003 will push back feasibility of new supply in many

markets for some time to come.

Meet the Money, founded by Jim Butler in 1990, is the hotel industry's only one-day conference that focuses on hotel-related lending issues and financing trends and policies. In addition, the Conference provides a venue for lenders and potential borrowers to meet in a casual, networking atmosphere.