Fairmont Hotels & Resorts Inc. To Realize $110 Million Gain On Sale Of The Fairmont Kea Lani Maui

Fairmont Hotels & Resorts Inc. To Realize $110 Million Gain On
Sale Of The Fairmont Kea Lani Maui
- Fairmont to Continue to Manage the Resort under Long-term Management Contract
- 


TORONTO, June 7  /PRNewswire-FirstCall/ -- Fairmont Hotels & Resorts Inc.
("FHR" or the "Company") (TSX/NYSE: FHR) today announced that it has agreed to
sell The Fairmont Kea Lani Maui to Host Marriott Corporation ("HMT") (NYSE:
HMT) for $355 million, or $789,000 per room. The resort will continue to be
known as The Fairmont Kea Lani Maui and will be managed by Fairmont under the
existing long-term management contract.

The transaction is expected to close in August, subject to customary closing
conditions. FHR expects to reinvest a portion of the proceeds in additional
hotels over the course of the next year. The Company also intends to use the
sale proceeds to acquire the remaining interest in the Fairmont management
company, to increase its share purchases under its existing share repurchase
program and, in the interim, to reduce existing indebtedness.

Maritz, Wolff & Co. recently advised FHR that it intends to exercise its put
option on the remaining 16.5% interest in the Fairmont management company. This
transaction is expected to be completed in the third quarter, at which time FHR
will own 100% of the Fairmont brand and management company. Maritz, Wolff & Co.
is a significant owner of hotel real estate managed by Fairmont and will
continue to be an important partner in the future.

In February 2001, FHR purchased The Fairmont Kea Lani Maui and its management
contract for $250 million. Following the completion of the sale, FHR will
realize a pre-tax gain of approximately $110 million and an after-tax gain of
about $69 million.

"This is an attractive time to capitalize on our success with The Fairmont Kea
Lani Maui. In the three years that we have owned this resort, it has enjoyed
solid growth in operating performance as a result of our experience in luxury
resort management and Fairmont's strong brand presence in the California
market," commented William R. Fatt, Chief Executive Officer of FHR.
"Importantly, this sale indicates the underlying value of many of Fairmont's
world-class assets. It also reinforces our strategy of acquiring attractive
assets, realizing the value created through improved performance and then
redeploying the capital to continue growing the company."

Continued Mr. Fatt, "We are pleased to have the opportunity to work with such a
well-respected hotel owner as HMT on such an attractive asset as The Fairmont
Kea Lani Maui."

Christopher J. Nassetta, HMT's President and Chief Executive Officer,
commented, "We are delighted to add this luxury resort located in the exclusive
destination of Wailea, Maui to our portfolio. We look forward to partnering
with Fairmont, North America's largest luxury resort manager, to further build
on the exceptional reputation of The Fairmont Kea Lani Maui." Added Mr.
Nassetta, "We hope this partnership is the first of many opportunities to build
our relationship with FHR through the future acquisition of hotels that
Fairmont could manage."

About Fairmont Hotels & Resorts Inc.

FHR is one of North America's leading owner/operators of luxury hotels and
resorts. FHR's managed portfolio consists of 82 luxury and first-class
properties with more than 33,000 guestrooms in the United States, Canada,
Mexico, Bermuda, Barbados and the United Arab Emirates. It holds an 83.5%
controlling interest in Fairmont Hotels Inc., North America's largest luxury
hotel management company, as measured by rooms under management. Fairmont
manages 44 distinctive city center and resort hotels such as The Fairmont San
Francisco, The Fairmont Banff Springs and The Fairmont Scottsdale Princess. FHR
also owns Delta Hotels, Canada's largest first-class hotel management company,
which manages and franchises 38 city center and resort properties in Canada. In
addition to hotel management, FHR holds real estate interests in 23 properties
and an approximate 35% investment interest in Legacy Hotels Real Estate
Investment Trust, which owns 24 properties.

About Host Marriott Corporation

Host Marriott is a Fortune 500 lodging real estate company, which owns 111
upscale and luxury full-service hotel properties primarily operated under
Marriott, Ritz-Carlton, Four Seasons, Hyatt and Hilton brand names. 

DATASOURCE: Fairmont Hotels & Resorts Inc.



CONTACT: Investors: Emma Thompson, Executive Director

Investor Relations, Tel: [phone], Email: ,

Website: http://www.fairmont.com/investor; Media: Laura Fairweather, Executive

Director Public Relations, Tel: [phone], Email:

, Website: http://www.fairmont.com/

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