Graves and WORLDHOTELS Launch Graves World Hospitality

First-of-its-Kind Business Venture Offers Independent Hoteliers Full-Service Management, Sales, Mark

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. October 14, 2008

NEW YORK, NY, November 14, 2006. Graves Hotels Resorts, a Minneapolis-based hotel ownership, development and management company, and WORLDHOTELS, a leader in the global independent hotel sales, marketing and distribution industry, today announced the formation of Graves World Hospitality, the hotel industry's first joint-venture company to offer full-service management, sales, marketing, distribution and related business-building services to luxury independent, upscale independent, and branded upscale hotels and resorts. Operations will initially focus on hotels located in the Americas, with plans to expand globally in the future. The company's headquarters will be located in Minneapolis, with support offices in Orlando and New York City.

The announcement was jointly made by James Graves, CEO of Graves Hotels Resorts; Benjamin Graves, president of Graves Hotels Resorts; and Tom Griffiths, vice president of WORLDHOTELS-the Americas, during the International Hotel/Motel & Restaurant Show.

"We believe Graves World Hospitality will fill a gap that currently exists in the hotel industry," said James Graves. "Many companies offer either management or sales, marketing and reservations support - none offer everything an independent hotelier needs in one package. This new venture will focus on independent hotels in the luxury segment, but will also work with independent and branded full-service, upscale hotels that meet our standards."

"Our key point of differentiation is that Graves World Hospitality will provide a comprehensive set of services at a fraction of traditional chain cost," said Benjamin Graves. "Our set-fee structure will cost a hotelier much less than typical brand-affiliation fees, which today hover around 14 percent."

James Graves added that hotels can opt for the Graves' brand name (if they meet the brand's strict standards of excellence) and take advantage of "Guest Luxuries," Graves World Hospitality's new guest loyalty program.

Griffiths said he believes this new joint-venture will be successful based on growth trends within the independent segment and statistics indicating that boutique hotels perform better than high-end, full service properties.

"In the past year or so, WORLDHOTELS has seen a growing number of hotel owners reconsider their brand affiliations, and return to an independent status," said Griffiths. "In addition, industry research from PKF Consulting(a) shows that boutique hotels performed better than high-end branded hotels in not only occupancy and rooms RevPar, but had a higher daily rate, better profit per available room and a greater profit margin."

Griffiths finished by saying that while Graves World Hospitality is a new entity, it will be operated by approximately 90 experienced professionals in 31 sales and reservations offices worldwide. In addition, guests of Graves World Hospitality hotels will be able to earn frequent flyer miles with 17 global airline partners - the most of any independent hotel group.

For more information about Graves World Hospitality, visit online at gwhospitality.com.

(a)Source: PKF Consulting - 2006 Trends in the Hotel Industry