NEW YORK--An investment partnership whose majority investor is one of the Whitehall Street Real Estate Funds, a series of real estate opportunity funds sponsored by Goldman, Sachs & Co., announced today that it has purchased New York's Metropolitan Hotel from Loews Hotels. The investment partnership also includes Highgate Holdings and Oxford Capital Partners, Inc./Oxford Lodging Investment and Advisory Group LLC.

The partners in the joint venture also announced that the 722-room midtown Manhattan Metropolitan Hotel will immediately undergo a dramatic aesthetic transformation designed to maintain the hotel's prominence among choices for visitors to New York. The Metropolitan's guest rooms, lobby and other public areas will all be refurbished to reflect stylish, contemporary themes.

"Our partnership's purchase and renovation plans for the Metropolitan Hotel are based on our underlying belief in the strength of New York City as one of the most popular and important destinations in the world. We believe that this transaction provides our partnership the exciting opportunity to re-position the asset and capitalize on the resurgence of the New York hospitality market," said David H. Snell, Vice President, Highgate Holdings.

"Oxford Capital and its sister company, Oxford Lodging, view the Metropolitan acquisition as an intriguing 'spot market' macro repositioning opportunity in an attractive location in midtown Manhattan. We are strong believers in New York City's fundamental strength as a hotel real estate investment market and have confidence in its long term prospects," said John W. Rutledge, The Oxford Capital Companies.

The Metropolitan is located at the corner of Lexington Avenue and 51st Street, in the heart of midtown Manhattan. This central location, close to Manhattan's primary business, commercial, cultural and shopping districts, has made it a popular hotel for visitors to New York since it opened in 1961. The Metropolitan was designed by architect Morris Lapidus. It has been distinguished by its art deco, post-modern architectural features, its curving facade and colorful exterior, which contrast with muted colors of nearby buildings. In addition to its guest rooms, the Metropolitan encompasses 12,000 square feet of meeting space and concierge floors with private lounge, a fully equipped health club, gift shop, beauty salon, Lexy Lounge and the Lexington Avenue Grill restaurant and bar.

Goldman Sachs is a leading global investment banking, securities and investment management firm that provides a wide range of services worldwide to a substantial and diversified client base that includes corporations, financial institutions, governments and high net worth individuals. Founded in 1869, it is one of the oldest and largest investment banking firms. The Whitehall Street Real Estate Funds are Goldman Sachs' primary investment vehicles for making privately negotiated real estate investments. The current Whitehall fund was formed in early 2001 with total committed capital of $2.5 billion, $550 million of which was committed by Goldman Sachs and its employees, with the remainder committed by institutional and individual investors.

Highgate Holdings is a privately held investment firm whose principal investment activities focus on real estate and public market ownership. The company has offices in Dallas, New York and Vancouver, British Columbia, Canada. Highgate's investments include hotels, office buildings, residential projects, industrial complexes as well as significant positions in both public and private corporations.

Oxford Capital Partners, Inc., headquartered in Chicago, is a real estate principal investment, private equity and investment management firm that invests across the real estate asset classes, with an emphasis on the hospitality sector, and in select corporate private equity transactions, with an emphasis on consumer retail. Oxford Capital's primary affiliate is San Francisco based Oxford Lodging Advisory and Investment Group, LLC. Oxford Lodging is an institutional advisory and principal investment firm dedicated exclusively to the hospitality sector.