Morgans Hotel Group Refinances the Mortgage Loan Secured by Hudson

      Morgans Hotel Group Refinances the Mortgage Loan Secured by Hudson

- New Loan Provides Additional Liquidity -

- Financing Underscores Significant Value of Hudson Real Estate -

PR Newswire

NEW YORK, Nov. 14, 2012

NEW YORK, Nov. 14, 2012 /PRNewswire/ --Morgans Hotel Group Co. (NASDAQ: MHGC)
("Morgans"), the New York-based hospitality management company, today
announced that it has successfully executed a new $180 million non-recourse
loan secured by Hudson in New York. The proceeds were used to retire the
previous mortgage loan on Hudson of $115 million and fund reserves required
under the new loan, with the remainder available for general corporate
purposes.

"This new financing demonstrates the significant equity value we have in
Hudson," said Michael Gross, CEO of Morgans. "We recently completed renovating
all the guest rooms at Hudson and anticipate adding another 32 rooms later
this year, bringing the total number of rooms up to 866. With this new capital
and the sales process at Delano well underway, we are significantly improving
our liquidity and believe we are well positioned to address upcoming
maturities."

The loan can be prepaid at any time and there is no prepayment premium after
the first twelve months. Interest is calculated at LIBOR plus 8.40% with a
0.50% LIBOR floor. The loan matures in February 2014 with a one year extension
option to February 2015. The lender is UBS Real Estate Securities Inc.

About Morgans Hotel Group

Morgans Hotel Group Co. (NASDAQ: MHGC) is widely credited as the creator of
the first "boutique" hotel and a continuing leader of the hotel industry's
boutique sector. Morgans Hotel Group operates Delano in South Beach and
Marrakech, Mondrian in Los Angeles, South Beach and New York, Hudson in New
York, Morgans and Royalton in New York, Shore Club in South Beach, Clift in
San Francisco, Ames in Boston, Sanderson and St Martins Lane in London, and a
hotel in Playa del Carmen, Mexico. Morgans Hotel Group has ownership
interests in or owns several of these hotels. Morgans Hotel Group has other
property transactions in various stages of completion, including Delano
properties in Las Vegas, Nevada; Cesme, Turkey and Moscow, Russia; Mondrian
properties in London, England; Marrakech, Morocco; Istanbul, Turkey; Doha,
Qatar and Nassau, The Bahamas; and a Hudson in London, England. Morgans Hotel
Group also owns a 90% controlling interest in The Light Group, a leading
lifestyle food and beverage company. For more information please visit
www.morganshotelgroup.com.

Forward-Looking and Cautionary Statements

This press release may contain certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements relate to, among other things, the operating
performance of our investments and financing needs and prediction of certain
future other events. Forward-looking statements are generally identifiable by
use of forward-looking terminology such as "may," "expect," "anticipate,"
"estimate" "believe," "project," or other similar words or expressions. These
forward-looking statements reflect our current views about future events and
are subject to risks, uncertainties, assumptions and changes in circumstances
that may cause our actual results or other future events to differ materially
from those expressed in any forward-looking statement. Important risks and
factors that could cause our actual results to differ materially from those
expressed in any forward-looking statements include, but are not limited to
economic, business, competitive market and regulatory conditions such as: a
sustained downturn in economic and market conditions, particularly levels of
spending in the business, travel and leisure industries; continued tightness
in the global credit markets; general volatility of the capital markets and
our ability to access the capital markets; our ability to refinance our
current outstanding debt and to repay outstanding debt as such debt matures;
our ability to protect the value of our name, image and brands and our
intellectual property; risks related to natural disasters, such as
earthquakes, volcanoes and hurricanes; hostilities, including future terrorist
attacks, or fear of hostilities that affect travel; and other risk factors
discussed in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2011, and other documents filed by the Company with the
Securities and Exchange Commission from time to time. All forward-looking
statements in this press release are made as of the date hereof, based upon
information known to management as of the date hereof, and the Company assumes
no obligations to update or revise any of its forward-looking statements even
if experience or future changes show that indicated results or events will not
be realized.

SOURCE Morgans Hotel Group Co.

Website: http://www.morganshotelgroup.com
Contact: Richard Szymanski, Morgans Hotel Group Co., +1-212-277-4188
 
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