Investcorp Real Estate Group and Sage Hospitality Resources Acquire Sheraton Hotel in Tucson

Business Wire, Dec 10, 2007

NEW YORK & DENVER -- Investcorp's U.S. based real estate group and Sage Hospitality Resources, one of the nation's most widely recognized hotel development and management companies, today announced the joint acquisition of The Sheraton Tucson Hotel and Suites in Tucson, Arizona. Specific financial terms of the transaction were not disclosed.

The Sheraton Tucson is a 4-story, 216-room, full-service hotel featuring 135 spacious suites and an upscale-American cuisine restaurant, Trophies Bar & Grill. The property has 11,000 square feet of meeting and banquet space, including a 4,225 square foot Grand Ballroom.

"We are pleased to announce the acquisition of the Sheraton Tucson Hotel and Suites, our second acquisition with Sage as a joint-venture partner in the last nine months. The Sheraton Tucson is a well located asset in a market that exhibits solid population and employment growth," said Herb Myers, Managing Director with Investcorp's real estate group. "Investcorp is an active yet disciplined value-oriented investor and we believe that this asset is well positioned to yield attractive returns for Investcorp and its investors."

Located in Tucson's eastern submarket directly adjacent to the Tucson Medical center, the hotel is located near popular golf, spa, and local sports attractions including Major League Baseball Spring Training Camps. It is also in close proximity to the University of Arizona, Monthan Air Force Base and Raytheon Missile Systems, Tucson's largest employer.

Mr. Myers added that the property is currently being remodeled with significant upgrades being made to the hotel's exterior and landscaping, guestrooms, common areas and meeting and banquet space.

Walter Isenberg, President and CEO of Sage Hospitality Resources said, "The Sheraton Tucson is an exciting investment and we believe that there is significant untapped potential in this property. The capital improvements we are planning for this hotel will maximize its attractiveness as a location of choice for business travelers, banquet groups, corporate meeting guests and others. This property is an excellent addition to our portfolio in Arizona and nationwide and we look forward to enhancing this location with our focus on outstanding customer service and operational excellence."

The acquisition of the Sheraton Tucson Hotel and Suites continues Investcorp's impressive expansion trend in the western U.S. Other recent acquisitions include a portfolio of office and R&D facilities in the Silicon Valley and The Bravern, a 1.6 million square foot mixed-use development project in Bellevue, Washington.

About Sage Hospitality Resources

Founded in 1984, Sage Hospitality Resources is a nationally recognized hotel developer and management company based in Denver, CO. During its 22-year history, Sage has managed over 300 properties in 39 states, including major brands such as Hilton Hotels, Marriot, Starwood, Holiday Inn, and independent hotels and resorts. Sage partners have included JP Morgan, Citigroup, Highland Hospitality, The Carlyle Group, Goldman Sachs, Cargill Asset Investment and Finance, and Kimberly-Clark. For more information about Sage Hospitality Resources, please visit the company's website: www.sagehospitality.com

About Investcorp Real Estate

With offices in New York and Los Angeles, the Investcorp real estate group is a well-capitalized, value-oriented real estate investor with an investment portfolio totaling in excess of $5 billion (total capitalization) and a long and distinguished track record of success. Investcorp's real estate team, is experienced in the acquisition, development, financing, leasing, management, and disposition of a wide variety of property types including office, retail, hotel, residential, mixed-use and luxury resorts. The group takes a flexible approach to investing and works closely with local operating partners and developers on both a co-investment and direct investment basis.

Investcorp's real estate group is part of Investcorp, a leading provider and manager of alternative investment products. Investcorp has offices in New York, London and Bahrain and is publicly traded on the London Stock Exchange (IVC) and Bahrain Stock Exchange (INVCORP). The firm has five lines of business: real estate, private equity, hedge funds, technology investment and Gulf growth capital. Founded in 1982, Investcorp has grown to become one of the largest and most diverse alternative investment managers in terms of both product offerings and geography, and currently has approximately $13 billion in invested assets under management. Additional information on Investcorp can be found at www.investcorp.com, or through the contacts below.