WestCoast Hospitality Corporation Announces Sale of WHC Building

SPOKANE, Wash., March 8 /PRNewswire-FirstCall/ — WestCoast Hospitality Corporation (NYSE: WEH) today announced that it has entered into an agreement for the sale of an 80.1% interest in the WHC Building, located in Spokane, Washington, for $10.6 million. The purchasers, an investment group, are located in Oregon and California. The Company will retain ownership of the remaining 19.9% interest and will continue management and leasing services for the property through its G&B Real Estate Services Division. The transaction is expected to close by the end of March 2002 and remains contingent upon completion of the normal approval processing of the transaction by the existing lender.
The sale of the property is part of a previously announced strategy of the Company to sell non-core assets while maintaining sliver ownership interests and management responsibilities, with proceeds of the sales used for debt repayment and further growth of the Company. WestCoast expects to add 9 to 19 hotels during 2002 through franchising and sliver equity investments, while growing its commercial and residential management portfolio and its TicketsWest entertainment division.
The sale is expected to result in a before tax gain of approximately $4.9 million which $1.7 million will be deferred over six years due to the continued lease by the Company for its corporate headquarters. The immediate net gain is expected to contribute approximately $0.16 Earnings Per Share in the first quarter of 2002. Previous Company financial guidance for the quarter did not include the potential impact of the sale, therefore revised guidance for E.P.S. for the first quarter is between $0.02 and $0.08, compared to $0.05 in the first quarter of 2001. Guidance for E.P.S. in the year 2002 is being increased to a range of $0.73 to $0.92, compared to $0.59 for the year 2001.
The WHC Building, located on the north bank of the Spokane River, and adjacent to the WestCoast Grand Hotel, is a six story, 100,350 square foot Class A office building. The Company developed the building and opened it in 1985. Since that time the building has served, and will remain, as WestCoast's corporate headquarters. The building is currently 98% occupied by tenants including Avista Energy, IBM, Potlatch Corporation and Morgan Stanley.
WestCoast Hospitality Corporation completed the acquisition of Red Lion Hotels, Inc. in December 2001 and now owns, manages and franchises more than 90 hotels in 16 states. WestCoast Hotels and Red Lion Hotels and Inns focus on serving business, convention and leisure travelers in first, second and third tier markets. WestCoast provides entertainment services through TicketsWest, including event ticketing for venues in the United States and Canada, and aggregates content for travel and entertainment that is sold in real-time at its www.ticketswest.com website. TicketsWest also includes WestCoast Entertainment, a Broadway and special event presenting company. G&B Real Estate Services is the real estate division of WestCoast Hospitality Corporation and owns and manages commercial and residential properties. Registered trademarks of WestCoast Hospitality Corporation and its affiliates protect the use of WestCoast, Red Lion, TicketsWest and associated logo designs.