Host Marriott Closing of Issue

PRNewswire-FirstCall BETHESDA, Md. Nov. 10 :

Host Marriott Corporation today announced that Host Marriott, L.P. closed
its private placement to qualified institutional buyers of $725 million
senior notes due 2013, or the “New Notes” on November 6, 2003. The New
Notes bear interest at a rate of 7 1/8%.

The proceeds from the New Notes will be used to redeem $429 million of
Host Marriott L.P.`s existing 7 7/8% Series A senior notes due in 2005 and
$282 million of its 8.45% Series C senior notes due in 2008. The terms of
both existing notes require the payment of a premium to the holders in
exchange for the right to retire these notes in advance of their maturity
dates. The date of redemption is December 8, 2003.

The call premium payments, additional interest expense on the New Notes
during the call period and the acceleration of the related deferred
financing fees will result in a one-time increase to interest expense of
approximately $33 million, impacting earnings and Funds From Operations,
or FFO, per diluted share for the year. Additionally, Host Marriott
Corporation announced that its full year earnings will be affected by the
Financial Accounting Standards Board, or “FASB,” decision to indefinitely
defer the application of accounting standard SFAS No. 150 with respect to
minority interests in certain consolidated ventures, which was announced
by the FASB on October 29, 2003. The reversal of the FASB`s position on
this matter will result in a $24 million gain being recorded in the fourth
quarter, eliminating the $24 million loss the Company had recorded in the
third quarter. Accordingly, the Company is issuing the following updated
guidance for full year 2003:
* Diluted loss per share should be approximately $.78 to $.73; * Net loss
should be approximately $183 million to $169 million; * FFO per diluted
share should be approximately $.51 to $.55; and * Adjusted Earnings before
Interest Expense, Taxes, Depreciation and Amortization and other items, or
Adjusted EBITDA, remains consistent with prior guidance of approximately
$715 million to $730 million.

See the attached schedules for a reconciliation of net loss available to
common shareholders to FFO per diluted share, a reconciliation of net loss
to Adjusted EBITDA, and a discussion of Adjusted EBITDA and FFO per
diluted share, which are non-GAAP financial measures within the meaning of
the Securities and Exchange Commission, or SEC, rules.

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This press release contains forward-looking statements within the meaning
of federal securities regulations. Forward-looking statements are not
guarantees of future performance and involve known and unknown risks,
uncertainties and other factors which may cause the actual results to
differ materially from those anticipated at the time the forward-looking
statements are made. These risks include, but are not limited to: national
and local economic and business conditions that will affect occupancy
rates at our hotels and the demand for hotel products and services;
operating risks associated with the hotel business; risks associated with
the level of our indebtedness and our ability to meet covenants in our
debt agreements; relationships with property managers; our ability to
maintain our properties in a first-class manner, including meeting capital
expenditure requirements; our ability to compete effectively in areas such
as access, location, quality of accommodations and room rate structures;
changes in travel patterns, taxes and government regulations which
influence or determine wages, prices, construction procedures and costs;
and our ability to continue to satisfy complex rules in order for us to
qualify as a real estate investment trust for federal income tax purposes.
For further information regarding risks and uncertainties associated with
our business, please refer to the Company`s filings with the SEC. Although
the Company believes the expectations reflected in such forward-looking
statements are based upon reasonable assumptions, it can give no assurance
that the expectations will be attained or that any deviation will not be
material. All information in this release is as of November 10, 2003 and
the Company undertakes no obligation to update any forward-looking
statement to conform the statement to actual results or changes in the
Company`s expectations.
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