Washington's Largest Hotel Purchased by Local Investment Group.

WASHINGTON--(BUSINESS WIRE)--Jan. 15, 1999--

Multi-million-dollar renovation planned to boost convention trade

The largest hotel in the nation's capital, the Marriott Wardman Park on Connecticut Avenue, has been bought by a hotel investment group headed by local businessmen Frederic V. Malek and Leland C. Pillsbury.

The new owners will carry out a $50 million renovation of all guest rooms and public spaces in the historic hotel that will make it one of the nation's most modern and comfortable convention facilities and will attract additional visitors to the District of Columbia, spurring a vital segment of the Washington area's economy.

The 1,338-room Marriott Wardman Park was purchased last week by Thayer Hotel Investors, an Annapolis-based investment firm founded by Malek, Pillsbury and several other Washington-area businessmen with outstanding track records in the hotel industry. The overall purchase price for the hotel exceeded $200 million.

Measured either by the size of the hotel or the sale price, the transaction was the largest real estate deal in the American hotel industry over the past year.

"All of us at Thayer Hotel Investors are delighted to be associated with the premier hotel in the nation's capital," Mr. Malek said. "We are committing significant resources and a great deal of energy to ensure that the Marriott Wardman Park will be one of America's most sought-after convention venues."

Pillsbury added, "We can make this commitment because Washington, D.C. is a vibrant city that is attractive to visitors for a host of reasons. By providing a world-class convention facility, we believe we can contribute to the growth of Washington's regional economy and the economic opportunities available to local residents."

The Marriott Wardman Park is currently Washington's most complete convention facility. It has more guest rooms than any other hotel in the region, more meeting rooms and exhibit space, one of the area's largest ballrooms and a total of 173,000 square feet of meeting and exhibit space. It is conveniently located just south of the National Zoo and has direct access by Metrorail to Washington's monumental core and the city's new downtown convention center to be built at Gallery Place.

The hotel also is rich in history. The oldest portion of the hotel, Wardman Tower, dates to 1928, is listed on the National Register of Historic Places, and has been home to three U.S. presidents. The first television broadcast of NBC's Meet the Press originated from the Wardman Park.

The hotel's previous owner, Boston-based John Hancock Mutual Life Insurance Co., has already begun a complete interior and exterior restoration of Wardman Tower that will include furnishing its suites with European antiques, many of them original to the hotel. Thayer will complete and enhance that renovation.

Thayer also will execute a complete remodeling of the entry lobby and public spaces of the Marriott Wardman Park that will enable the hotel to greet guests in a more welcoming environment. Thayer will expand and update the existing lobby, completely redo the hotel's restaurants and taverns, and add a much larger porte-cochere entryway that will enable guests to arrive and depart more conveniently. Those improvements are scheduled to be complete by the end of 1999.

Along with its significance for Washington's convention and tourism industry, Thayer's purchase of the Wardman Park will have an impact on the hotel industry nationwide. According to The Plasencia Group, a leading national real-estate brokerage that specializes in hotel-industry transactions, Thayer's purchase is larger than any industry real estate transaction that took place in 1998.

The transaction also elevates Thayer into the top ranks of America's hotel ownership and development firms. Thayer currently owns 16 hotels nationwide that are managed by a number of well-known operating companies, including Marriott, Doubletree and Sheraton.

In its past hotel purchases, Thayer has improved the financial performance of properties by improving facilities and, where necessary, bringing in new management. But Thayer is delighted to announce that Marriott International will continue to manage the Wardman Park, continuing the high standards of customer service for which Marriott is famous.

Lee Pillsbury stated, "This purchase is indicative of the great investment opportunities in the hotel industry today. We look forward to further acquisitions in 1999 in the Washington area and elsewhere."

Thayer was founded eight years ago by Mr. Malek and Mr. Pillsbury, both of whom had previously enjoyed successful careers in hotel management and development at Marriott International. (Mr. Malek, a graduate of the U.S. Military Academy, named Thayer in honor of Col. Thayer, an early superintendent of West Point who is credited with building the school's tradition of excellence.)

Mr. Malek has a long record of achievement in business and politics. Along with his work at Marriott, he led a leveraged buyout of Northwest Airlines in the early 1990s and has since established and serves as chairman of Thayer Capital Partners, a Washington-based merchant bank that owns and operates diverse international businesses ranging from computer software to bicycle manufacturing. Mr. Malek also served in the White House under Presidents Richard M. Nixon and Ronald Reagan, and was chairman of President George Bush's 1992 campaign.

Mr. Pillsbury previously spent 20 years at Marriott, where as a corporate officer he oversaw the company's Residence Inns and Fairfield Inns divisions. During his tenure, the number of hotels in these divisions increased from 125 to more than 700. -0-

                      Marriott Wardman Park Hotel
                            Facts & History

     -- As Washington's preeminent convention hotel, the 1,338 room
        Marriott Wardman Park Hotel is the largest hotel in the
        Washington, D.C. metropolitan area and the 8th largest hotel
        in the United States.
     -- Thayer Hotel Investors' purchase of the Wardman Park Hotel
        exceed $200 million and is the largest hotel transaction (both
        in terms of the number of rooms and dollar amount) in the
        United States over the past twelve months.
     -- Situated atop a sixteen-acre landmark estate in northwest
        Washington, the Wardman Park has by far the most convention
        space in the Washington area: 95,000 square feet of dedicated
        exhibit space and 78,000 square feet of meeting space,
        including 46 meeting rooms and a private executive boardroom.
     -- With a ballroom of 30,000 square feet, it has one of the
        largest ballrooms in Washington, D.C.
     -- The hotel employs a total of 1,000 people, of whom 30 percent
        reside in the District of Columbia.
     -- The hotel has hosted some of the most prominent events in the
        nation's capital, including meetings of the World Bank and
        International Monetary Fund, Department of State functions,
        presidential inaugural balls and numerous other appearances by
        the President of the United States.
     -- It is currently undergoing a $50 million renovation program,
        which is scheduled for completion in December 1999.
     -- The most historic portion of the hotel, Wardman Tower, dates
        back to 1928 and was named to the National Register of
        Historic places in 1984. It is being fully restored to its
        original grandeur, with antique French and English furniture.
     -- The Marriott Wardman Park is rich in history and has been the
        home to numerous nationally known figures including:
          -- U.S. Presidents Hoover, Eisenhower, Lyndon Johnson
          -- Vice Presidents Charles Curtis, Henry Wallace, Spiro
             Agnew
          -- Chief Justices Frederick M. Vinson and Earl Warren
          -- Senators Charles Robb, Barry Goldwater, Robert Dole
          -- Hollywood legend Marlene Dietrich
     -- The first televised broadcast of Meet the Press took place in
        the Wardman Tower in 1947, and the program continued to
        originate there for decades.
     -- NBC television and other broadcast organizations originated
        many programs from the hotel, including:
          -- Meet the Press with moderator Lawrence Spivak (a Wardman
             Tower resident)
          -- The Camel News Caravan
          -- The Today Show (Frank Blair segments)
          -- The Arthur Murray Dance Program
     -- The Marriott Wardman Park Hotel is a Mobil and AAA award
        winning property.

History of the Wardman Park Hotel

In 1918, developer Harry Wardman celebrated the end of World War I by opening the five-million-dollar 1,000-room Wardman Park hotel. In 1928, the main building was expanded with the opening of the annex, now known as the historic Wardman Tower. The Sheraton Corporation purchased the property in 1953 and renamed it the Sheraton Park Hotel. Substantial additions were made to the property transforming it into a full-scale convention hotel, including the 1964 addition known as the Park Tower. In 1980, the Sheraton Washington Hotel replaced the Sheraton Park Hotel, connecting the landmark Wardman Tower, the Park Tower and the Center Tower convention/exhibit area. Last year, Marriott International took over management of the property, renaming the hotel the Marriott Wardman Park Hotel.