Let's run down their portfolio and try to put a value on the company:
1. Fairmont Chicago: $2.2M in EBITDA third quarter which represents 52% of the 9-month total, so third quarter was definitely stronger than first and second quarters, but summer is probably their high season given the weather. If we annualize the 9-month EBITDA of $4.2M, result is $5.6M full year. Applying a Cap Rate of 7.5% yields a property value of $75M against current debt of $123.75M, so that property is a give-back, no equity.

2. Fairmont Scottsdate: ($2.5M) for Summer (low season), 9 month to date is $4.6M, full year $6.1M, with a cap rate of 8% given the seasonality, value is $76M against debt of $180M, that property is a goner.

3. Four Seasons Washington: $1.3M for summer (low season), 9-month $8.3M, annualize $11.1M cap at 7% given the property, $157M value, no debt, so that is equity.

4. Hotel del Coronado: Property EBITDA $32.2M for 9 months, annualized $42.9M, 7% cap=$613M against debt of $628.5M, BEE has 45% interest, not much there for BEE at this point. There is $54M in cash in that partnership, so maybe $17M for BEE's net share. North Beach Venture not bringing anything positive in, no value there.

5. Hyatt La Jolla: 9-month $5.0M, annualize to $6.67M cap at 7.5%=$89M against debt of $97.5M, no equity value there.

6. InterContinental Chicago: $12.4M 9-month, annualize $16.5M cap at 7.5% = $220M against debt of $121M, equity of about $100M.

7. InterCont Miami: $5.9M 9-month, annualize $7.87M cap at 7.5%=$105M against debt of $90M, equity of $15M there.

8. Loews: $6.8M 9-month, annualize $9.1M cap at 7.5%= $121M against loan of $118.25M, let's say no equity.

9. Marriot Lincolnshire: $1.55M, annualize to $2.06M cap at 8.5%= $24M value no debt, all equity

10. Ritz Half Moon: $3.6M annualize to $4.8M cap at 7%=$68.5M against debt of $76.5M, no equity there.

11. Ritz Laguna: $8.86M, annualize to $11.8M cap at 7%=$169M, no debt, all equity.

12. St. Francis: $11M, annualize to $14.7M cap at 7.5%=$196M, debt of $220M, no equity there.

13. Four Seasons Punta Mita: $9.2M, annualize to $12.3M cap at 7.5%=$164M, no debt, all equity

14. Prague: $6.8M, annualize to $9.1M cap at 8%=$113M against debt of $152M, no equity there.

15. Hamburg: breakeven after lease payment, no equity there

16. London: $7.9M, annualize to $10.5M, cap at 8%=$132M, against $123M loan, $9M equity

17. Paris: $1.3M contribution from leasehold annually, not much equity there, maybe $15M

18. Renaissance Paris: $1.9M, annualized to $2.5M cap at 8%=$31M, no debt, all equity

Adding up the equity equates to $701M, add in the current balance sheet cash of $88M and the proceeds from Mexico City of $54M, equals $843M.

Deduct off of that the outstanding note and credit facility of $437, results in $406M.

Par value of the Preferred is $358M, leaving $79M or about $1/share for the common. However, if you could buy back the preferred at 50% discount or less, currently trading at 30% of par, then the common would have $258M or $3.44/share value.

Plus, if economy has truly hit bottom, then numbers should start improving next year with resulting increases in equity through the portfolio. However, portfolio is operating at about breakeven now, and that does not account for FF&O, which will have to be funded from current cash and credit line. All things considered, if you truly believe that the economy has hit bottom and things can only get better going forward, this is probably a good investment long-term despite the overleveraged position of many of the properties. Those properties, as long as they are able to cover their debt payments will probably have their loans modified, stretched out, renegotiated to buy more time going out to 2014-15. That seems to be the trend, and for those properties that are negative cashflow, they should just give them back to the lender.