Host Marriott Corporation to acquire 38 properties from Starwood

Host Marriott Corp. has agreed to pay about $4.04 billion to acquire a portfolio of 38 luxury and
upscale hotels from Starwood Hotels and Resorts Worldwide Inc.

The deal is expected to close in early 2006 upon approval by each company's board of directors and
other closing conditions, as per the information available.

On part of Starwood, the latest move, which comprises the sale of hotels in cities from Los Angeles to
Madrid, is being termed as an initiative by Starwood to shed its real estate assets and concentrate on
operating, rather than owning hotels. The company had said it was in talks to sell $2 billion to $4 billion of real estate assets.

According to media, for Host Marriott, the deal is an opportunity to further expand its portfolio from its
original stable of Marriott-branded properties and represents a first bridgehead into the European
market, where it is acquiring hotels in Italy, Great Britain, Poland and Spain. Starwood said that under
the terms of the deal, it will continue to manage the properties -- including Sheraton, W, Westin, St. Regis and Luxury Collection hotels -- for up to 40 years.

Twenty-five of these properties are sprinkled throughout the United States and the other 13
properties are in international locations including Canada, Spain, UK, Poland, Chile, Fiji and Italy.
According to Reuters, Host Marriott expects to take on about $700 million in debt to fund the deal and issue about $2.3 billion in equity to Starwood shareholders. The remainder of the purchase price will be paid in cash, the Bethesda, Maryland-based company said.

All of the properties are luxury hotels averaging 500 rooms, each with an expected RevPAR of $117 for 2005, as per the information available.

James F. Risoleo, executive vice president of acquisitions and development for Host Marriott, said
that: "The Starwood portfolio fits our stated strategy of owning irreplaceable assets in premier markets with strong growth profiles and limited near-term supply."

Host said it expects the portfolio to generate $355 million to $365 million of EBITDA in calendar year
2006 on a stand-alone basis. It will also add about 3 cents to 5 cents per share to the company's diluted funds from operations.