Marathon Leads Residence Inn and Courtyard Hotel Combination in Montreal

330-room hotel complex will be located at Montreal-Trudeau Airport; Mayor of Borough of Saint-Laurent (City of Montreal) attends groundbreaking ceremony

MONTREAL, July 7 /PRNewswire/ — Marathon Asset Management, LLC and its investment group, Marathon Real Estate (MRE), today announced that it is the lead equity investor in the development of a new C$45 million (US$36.5 million), 330-room Residence Inn and Courtyard Hotel complex. The hotels, both by Marriott, will be located on 7.7 acres of land two miles east of the Montreal-Trudeau International Airport. A groundbreaking ceremony was held at the site today and was attended by Mayor Alan DeSousa of the Borough of Saint-Laurent (City of Montreal).

Urgo Hotels, a major developer, owner and operator of upscale hotels, has also made an equity investment in the project. Urgo Hotels recently partnered with MRE in their acquisition and renovation of the downtown 190-room Residence Inn in Montreal, a four star extended-stay facility.

“As our economy and tourist industry continue to grow, we are pleased to have such a quality investor in Marathon be so committed to our beautiful City,” said Alan DeSousa, Mayor of the Borough of Saint-Laurent and Member of the City of Montreal Executive Committee responsible for Economic Development.

The two-hotel complex will consist of a 170-suite Residence Inn and 160- room Courtyard Hotel. The buildings will be adjacent to each other with a connecting low-rise public structure, and will have shared amenities including, a restaurant, a bar/lounge, an indoor pool & whirlpool, a health club and a business center, including 6,000 square feet of meeting space. Each hotel will maintain its own entrance and lobby area. The complex is expected to be completed in the summer of 2006.

Jon Halpern, managing director of Marathon Real Estate, said, “Marathon recognizes the value of this unique development and the Urgo partnership, and will continue to seek similar opportunities in a Canadian market that has been underserved by the capital markets and the hospitality business.”

“The combination of these two distinct Marriott brands with shared facilities offers a higher quality of service to the extended-stay business traveler, as well as the leisure traveler,” said Ron Harrison, president of Marriott Lodging of Canada. “This project requires the financial expertise, flexible capital and developer experience that the partnership of Marathon Real Estate and Urgo Hotels provide.”

GE Commercial Finance is the construction lender. This is GE’s second transaction with the Marathon/Urgo team. Divco Limitee is the general contractor as well as an equity investor in the project.

The hotels will serve both the business and leisure travel markets. Local major employers include Air Canada, Bombardier Canadair, Honeywell Moteurs, Systems & Services, CAE Inc., and Nortel. The hotels will be located within a few minutes drive from Montreal International Airport and Technopark Saint- Laurent, the largest Canadian business park devoted to research and development activities for the aerospace, biotechnologies, pharmaceutical, information and telecommunication technologies industries.

In addition, the partnership of MRE and Urgo Hotels owns an adjacent 3.25-acre land parcel zoned for commercial use. The partnership is reviewing its options for either a sale or future development.

Urgo Hotels

Urgo Hotels is a Bethesda, Md.-based hotel company that develops, owns and operates distinctive and unique hotels under Marriott and Hilton flags in major markets in Canada and the United States. The company owns and/or operates 17 upscale hotels with 2,845 in the United States, and has properties under construction and two hotels under development in the U.S. and Canada.

Marathon Real Estate

Launched in early 2004 by Marathon Asset Management, LLC, Marathon’s Real Estate business is committed to identifying investment opportunities in the commercial real estate marketplace within the U.S. Since establishment, Marathon Real Estate has completed 14 real estate transactions totaling $1.4 billion. Marathon Asset Management, founded in 1998, has 78 professionals and specializes in sourcing, analyzing and investing in global credit sensitive debt instruments. The firm currently has over $4.3 billion of equity under management with total assets under management of $9 billion. Marathon Asset Management is a Registered Investment Advisor (RIA) with the Securities and Exchange Commission (SEC) in the U.S. Additional information about Marathon can be found at http://www.marathonrealestate.com/ .

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