Difficult time for Morgans Hotel Group

In the third quarter 2009, RevPAR at system-wide comparable hotels decreased by 32.2% (30.6% in constant dollars) compared to the third quarter of 2008. Occupancy declined by 8.9% and average daily rate declined by 25.5% (23.8% in constant dollars) compared to the same period in the prior year. However, Fred Kleisner, CEO of the Morgans Hotel Group, said: “We are confident that MHG is well positioned to continue to navigate the current economic challenges through 2009 and beyond, and will benefit from improving demand. We have made great progress in cleaning up our balance sheet and adding approximately $200 million in liquidity.” The company is still extendig the portfolio of properties with the expansion of the Hard Rock, the construction of the Boston Ames and the Mondrian SoHo, all of which are expected to be completed before the middle of 2010. As of last October the group is managing a 78 room beachfront hotel in Isla Verde, Puerto Rico.