Exhibit 99.1
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MARRIOTT HOTEL PROPERTIES LIMITED PARTNERSHIP
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1998 First Quarter Report
Limited Partner Quarterly Update
Presented for your review is the 1998 First Quarter Report for Marriott Hotel
Properties Limited Partnership (the "Partnership"). The 1998 First Quarter Form
10-Q immediately follows this letter and replaces the First Quarter Report
format previously used by the Partnership. The information presented is
essentially the same as the information given in prior years with certain
additional items required by the rules of the Securities and Exchange
Commission. Discussion of the Partnership's performance and Hotel operations is
included in Item 2, Management's Discussion and Analysis of Financial Condition
and Results of Operations. You are encouraged to review this report in its
entirety. If you have any further questions regarding your investment, please
contact Host Marriott Partnership Investor Relations at (000) 000-0000.
Host Marriott Corporation Real Estate Investment Trust
On April 17, 1998, Host Marriott Corporation ("Host Marriott"), parent company
of the General Partner of the Partnership, announced that its Board of Directors
has authorized the company to reorganize its business operations to qualify as a
real estate investment trust ("REIT") to become effective as of January 1, 1999.
As part of the REIT conversion, Host Xxxxxxxx expects to form a new operating
partnership (the "Operating Partnership") and limited partners in certain Host
Marriott full-service hotel partnerships and joint ventures, including the
Partnership, are expected to be given an opportunity to receive, on a
tax-deferred basis, Operating Partnership units in the new Operating Partnership
in exchange for their current partnership interest. We will keep you informed on
the status of this matter.
Cash Distributions
On May 4, 1998, the Partnership made a cash distribution of $1,500 per limited
partner unit. The distribution represented $540 per limited partner unit from
1997 operations and $960 per limited partner unit related to first quarter 1998
operations. The Partnership currently expects to make an interim 1998
distribution in November 1998.
Orlando World Center Expansion
As reported to you in the 1997 Annual Report, in March 1998, the Partnership
announced its plans to expand the Orlando World Center. The expansion includes a
500-room tower with a new parking garage, expansion of the existing JW's
Steakhouse restaurant, redesign of the existing golf course and constructing
15,000 square feet of additional meeting space. Construction of the new parking
garage began on May 4, 1998.
On April 15, 1998, the Partnership successfully completed the financing for the
expansion of the Orlando World Center hotel. The lender is obligated to provide
up to $88 million to fund the costs related to the construction of the
expansion. During the construction period, the Partnership is required to make
interest only payments at the fixed interest rate of 7.48% with such interest
payments funded by the construction loan. Upon completion of the expansion, the
Partnership would be required to pay principal and interest at the fixed
interest rate of 7.48% amortized over the remaining term of the loan. The loan
matures on January 1, 2008.
