Fairmont Hotels & Resorts and Sunstone Hotel Investors, announced today
that they have entered into an agreement for Fairmont to manage the 444-room Sutton Place Hotel in Newport Beach, California. Sunstone is currently under contract to purchase the property with closing currently scheduled for mid-May. Sunstone will then commence a major renovation of the hotel’s guestrooms and public areas, anticipated
to cost approximately $22.0 million. Upon completion, expected to occur in
early 2006, the hotel will be re-named The Fairmont Newport Beach. “Fairmont is pleased about this opportunity to establish a relationship
with Sunstone, a well-known hotel owner,” said William R. Fatt, FHR’s
Chief Executive Officer. “We look forward to working with our new partner
to further strengthen the quality and performance of this property that is
located in an active center for commerce and tourism.”

Robert A. Alter, Sunstone’s Chief Executive Officer, stated, “The Sutton
Place represents an excellent opportunity to renovate and reposition an
underperforming property back into one of Orange County’s premier luxury
business hotels. The property will benefit from Fairmont’s luxury brand
profile, strong presence in the California market and global distribution
network. We look forward to developing this partnership with Fairmont.”
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