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HOST HOTEL PORTFOLIO PURCHASED BY MILESTONE CAPITAL CORPORATION
September 23, 2005


New Owner Hospitality Associates of Lancaster, L.P. To Undertake $11.0 Million in Planned Renovations
Boca Raton, Florida based Milestone Capital Corporation, owner of seventeen hotel properties in seven states, announced this morning their acquisition of the Lancaster Host Resort & Conference Center located at 2300 Lincoln Highway East (Route 30) Lancaster, PA 17602 (“Lancaster Host”), and the Sturbridge Host Hotel & Conference Center, located at 366 Main Street, Sturbridge, MA 01566 (“Sturbridge Host”); and unveiled plans for an $11.0 million combined renovation effort which is set to begin immediately.  The announcement was made at Milestone’s corporate headquarters located in Boca Raton, Florida.  The properties will be managed by Milestone’s operating affiliate, Milestone Hospitality International.

The purchase of the Lancaster and Sturbridge Host Hotels reunites under common ownership three properties, including the Holiday Inn Harrisburg East (acquired by Milestone in August, 2004), that historically have been linked together since the time that each was originally conceived, developed, and constructed by a single developer.  Each of these highly unique properties have subsequently enjoyed, for many years, reputations both locally and regionally as preferred destination and meetings facilities.  Commenting on the transaction, Mason W. Mednick, Executive Vice President of Milestone, indicated, “The three properties have historically been owned and operated as part of a mini-system of regional conferencing facilities; a system which benefited greatly from cross-selling and marketing initiatives.  It is our intention, through this acquisition, to resurrect that system, in part, while adding to its already strong, pre-existing sales and marketing base, through our own contacts, efforts, and perspectives.”

The Lancaster Host is located five miles from downtown Lancaster.  Situated on approximately 173 acres, the hotel consists of 330 guest rooms, two restaurants, an 80-seat lounge, 74,310 square feet of meeting space including a 23,540-square-foot detached Expo Center, a gift shop, two tennis courts, an indoor and outdoor swimming pool, a whirlpool, a fitness center, basketball and volleyball courts, and an 18-hole Championship Golf Course with separate pro shop.  The hotel’s dynamic location cannot be improved upon within the Lancaster market, situated directly across the street from “Dutch Wonderland”, a 48-acre amusement park operated by Hershey Corporation.  Lancaster County is known worldwide as “Pennsylvania Dutch Country”.  The area attracts more than 7 million people annually to its rolling farmlands, historic districts and landmarks.

The Sturbridge Host is located at the highly trafficked intersection of Interstate 90 (the Massachusetts Turnpike) and Interstate 84, centrally positioned within the Boston-Springfield-Hartford-Providence corridor.  Situated on approximately 17 acres, the hotel consists of 233 guest rooms, three restaurants, a lounge, approximately 27,000 square feet of meeting space including a 12,100-square-foot ballroom, a gift shop, a game room, an indoor swimming pool and whirlpool, an 18-hole miniature golf course, and a beach located on beautiful Cedar Lake, which is available for swimming, fishing and boating.  The hotel also features a full-service fitness center with extensive amenities including Jacuzzis, saunas, racquetball and basketball courts, free weights and Nautilus equipment, aerobics classes and tanning beds.  The town of Sturbridge is home to the largest outdoor living history museum in the northeastern United States, “Old Sturbridge Village”, which is located approximately 0.3 miles from the hotel and is the most visited tourist attraction in the region, hosting more than 400,000 visitors annually.

Milestone currently owns and operates four properties in the rich state association, government, and corporate conferencing markets of central and eastern Pennsylvania.  The acquisition of the Lancaster Host brings the Milestone Portfolio in that region to five hotels representing more than 1,100 guest rooms and 135,000 square feet of meeting space.  Lea Ann Kish, Chief Operating Officer of Milestone Hospitality, said, “The potential synergies provided by Milestone’s four existing properties and human resource infrastructure in the greater Pennsylvania marketplace to the Sturbridge and Lancaster Host Hotels are strong, particularly with respect to the critical sales and marketing function.  The markets are geographically aligned, and the reputation and existing relationships developed by our four Pennsylvania properties can impact the Sturbridge and Lancaster Host Hotels positively, and immediately.”

Ms. Kish further advised that Jonathan Shisler, having previously served as the General Manager of both the Providence Biltmore Hotel (Providence, RI) and Tremont Hotel (Boston, MA), would serve as General Manager of the Lancaster Host; while longtime Food & Beverage Director of the Hilton Washington D.C./Silver Spring Hotel, Charles Reed, would serve as interim General Manager of the Sturbridge Host Hotel.

The $11.0 million budget earmarked for property renovations will impact every aspect of operations at the Lancaster and Sturbridge Host Hotels, including exterior facades, roofs, parking facilities, lobbies, banquet rooms, guest rooms, restaurants, recreational facilities, and mechanical systems.  The renovations will mirror Milestone’s recently completed refurbishment of the Holiday Inn Harrisburg East, which effort also featured comprehensive upgrades to hotel furniture, fixtures, lighting and accessories, the addition of new wall and floor coverings throughout the property, and technological upgrades, including high-speed, wireless computer accessibility in all guest rooms and public meeting spaces.

The renovated Lancaster and Sturbridge Host Hotels will feature newly remodeled guest rooms with warm, rich and comfortable fabrics and colors, as well as the latest in technology-ready amenities for the demands of today’s corporate business traveler.

In addition to the Lancaster and Sturbridge Host Hotels, Milestone owns and operates the Chateau Resort & Conference Center (Tannersville, PA); the Holiday Inn Harrisburg East (Harrisburg, PA); the Hilton Washington DC/Silver Spring Hotel (Silver Spring, MD); the Holiday Inn Harrisburg-Hershey (Grantville, PA); the Best Western Inn Hershey (Hershey, PA); the Best Western Gateway Adirondack Inn (Utica, NY); the Holiday Inn Utica (New Hartford, NY); the Microtel Inn & Suites (Sulphur, LA); the Holiday Inn Deland (Deland, FL); the Days Inn Busch Gardens Maingate (Tampa, FL); the Days Inn North Fort Myers (Fort Myers, FL); and a consortium of 4 Days Inn properties in Frankfort, Shepherdsville, LaGrange, and Fort Wright/Cincinnati, KY.


About Milestone
Milestone is a leading full-service real estate development company specializing in the ownership and operation of hotel assets. Since 1996, Milestone has acquired 22 hotel properties located in eight states totaling 3,439 rooms. The Milestone Portfolio currently consists of 15 hotels located in seven states totaling 2,552 rooms. For more information about our company, please visit us online at www.milestonehotels.com.


 

     
           
       
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