John Ferchill Leading the $89 million Redevelopment of Bedford Springs Hotel

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. October 14, 2008

BEDFORD, PA, January, 2006. The Ferchill Group, Cleveland, OH, and development partner The Bedford Springs Company, LLC, Dallas, TX, announced that they have secured and closed $88.5 million in funding for the redevelopment of The Bedford Springs Hotel, located in Bedford, PA.

The Bedford Springs Hotel was constructed over time between 1804 and 1930, and became renowned throughout the 1800's for its seven mineral springs. During that time, such notable figures as Aaron Burr, John C. Calhoun, and Daniel Webster visited frequently. Seven U.S. Presidents have visited the hotel; James Buchanan made the Hotel as his summer White House from 1856 to 1860. The Hotel is listed on the National Register of Historic Places.

The Hotel boasts one of the country's first indoor Olympic-sized swimming pools (1904), which will be fully restored, and an historic golf course, originally built in 1896, later redesigned and expanded by Donald Ross in 1924. Plagued by an aging infrastructure and a lack of capital, the Hotel closed its doors in 1990.

The $88.5 million development budget includes a complete restoration of the historic portions of the Hotel, as well as construction of a new spa wing, which will contain a 15,000 square foot spa and an additional 99 rooms and suites. The Hotel will offer 216 rooms and suites when complete.

A new outdoor pool and tennis complex will be added. The Donald Ross course, which has been altered in certain respects over time, will be fully restored to his original design. Miles of hiking and biking trails covering the Hotel's 2,200 acres will be restored or created.

"The Hotel and its grounds hosted the upper echelon of society through the 19th and 20th centuries," said John Ferchill, Chairman and CEO of the Ferchill Group. "We look forward to restoring this property to its original grandeur and adding modern amenities to ensure that the property is a true destination resort once again."

Marshall Investments Corporation, Minneapolis, MN, provided the $40.0 million senior financing for the project. Chevron TCI, Inc., an investment subsidiary of Chevron Corp., committed $19.5 million in tax credit and easement equity, arranged by The Ferchill Group. Sovereign Pacific Equity, of Aliso Viejo, CA, advised Chevron. Thistle Financial Group, Greensburg, PA, arranged $7.5 million in tax credit bridge financing from five of its constituent banks. The Commonwealth of Pennsylvania pledged $26.9 million in development grant and infrastructure assistance, and the balance of project funding was provided by The Bedford Springs Company.

The architectural team for the project is comprised of Corgan Associates, Dallas, TX, 3 North, Richmond, VA, and Sandvick Architects, Cleveland. Reynolds Construction, Harrisburg, PA, will serve as general contractor.

All restoration and construction activity is expected to be completed by the Spring of 2007. The Hotel will re-open May 1, 2007. Benchmark Hospitality, Houston, TX, will manage the property.

The Ferchill Group is a real estate development and management firm based in Cleveland, Ohio. The firm specialized in large-scale historic restoration and adaptive re-use of obsolete properties.