Legacy to Acquire Seattle Olympic

TORONTO, July 3, 2003 - In October 2002, Legacy Hotels Real Estate Investment Trust (Legacy) (TSX: LGY.UN) agreed to purchase the Four Seasons Olympic, a Five Diamond hotel in Seattle. The purchase was subject to arbitration proceedings between the current hotel owner and manager as well as a number of other conditions. Legacy has been advised that a settlement has been reached today on these arbitration proceedings. Subject to the satisfaction of customary closing conditions and third-party approvals, Legacy will acquire the Olympic Hotel during the third quarter. 
Fairmont, the luxury hotel management company of Fairmont Hotels & Resorts Inc. (“FHR”) (TSX/NYSE: FHR), will operate the property, which will be officially flagged “The Fairmont Olympic Hotel, Seattle”.  Legacy has entered into an agreement with Fairmont for a long-term management contract and Fairmont has agreed to make a payment to Legacy to acquire this contract.  The terms of the agreement have been approved by Legacy?s Independent Trustees.

The purchase price for the property is approximately US$100 million, or Cdn$135 million, subject to adjustments and closing costs.  Legacy expects to use mortgage financing and lines of credit to finance the purchase of the hotel.

Commenting on the transaction, Neil J. Labatte, President and Chief Executive Officer of Legacy, said, “We are pleased to be adding such a high-quality heritage asset to our portfolio.  This Seattle hotel is an exceptional property in an important market and represents the qualities we seek for our portfolio of luxury hotels.” Added Mr. Labatte, “This irreplaceable property is a natural complement to Legacy?s strong Fairmont presence in both Vancouver and Victoria, British Columbia.”
About the Olympic Hotel: Built in 1924 and located in the heart of Seattle`s fashionable Rainier Square neighborhood, this 450-room property, including 209 suites, blends classic ambience with state-of-the-art amenities. Minutes away from the city`s arts & entertainment districts, the AAA Five Diamond hotel features two restaurants and two lounges, a fully equipped fitness center with indoor pool, high-speed Internet access in all guestrooms and 20,000 square feet of versatile meeting and function space.

About Legacy Hotels Real Estate Investment Trust: Legacy is Canada`s premier hotel real estate investment trust with 22 luxury and first-class hotels in Canada and one in the United States, consisting of over 10,000 guestrooms. The portfolio includes landmark properties such as Fairmont Le Ch‰teau Frontenac, The Fairmont Royal York, The Fairmont Empress and The Fairmont Washington, D.C.