Parent company Caribbean Property Group not talking; returning hotel to Tourism Co. possible scenario; CPG holding back to
protect Dorado deals
Rumors the reported “temporary” shutdown of the Normandie Hotel has turned into a permanent decision persist within industry
circles, according to CARIBBEAN BUSINESS sources close to the Normandie Hotel in Puerta de Tierra. However, repeated calls
to Normandie’s parent company, Caribbean Property Group (CPG), were to no avail. Al Young, CPG executive in charge of the
Normandie, didn’t return CARIBBEAN BUSINESS calls to deny or clarify rumors.

Meanwhile, industry executives close to CPG affirm that once the hotel is closed, it will be very difficult to reopen unless a
substantial investment is made to reposition the property. The future of the Normandie Hotel remains uncertain given its status as a
national historic site, which highly restricts the work that can be done onsite even if the consideration was to turn it into an
apartment building.

“Initially, it was considered that CPG could return the property to the Tourism Co. as a means of cutting its ongoing losses, thereby
enabling the Tourism Co. to determine the future use of the facility,” the source explained. However, amid CPG’s efforts to finalize
the Dorado deal, it decided to hold back on announcing the decision to permanently shut down the Normandie to protect the
Dorado development.

CPG, a diversified real-estate investment trust that owns and operates several commercial properties on the island, is finalizing the
deal on the former Dorado Beach Hotel, which will reopen under the Fairmont flag, and the former Dorado Cerromar, which will be
converted into a Ritz-Carlton Reserve.

Last week’s sudden announcement that the Normandie Hotel in Puerta de Tierra will be closed for an unspecified period took
many by surprise. The art-deco-style property, adjacent to the Caribe Hilton, was designed by architect Raúl Reichard and inspired
by the French ocean liner the S.S. Normandie. Construction was started in 1939 and the Normandie Hotel first opened for
business in 1942.

CPG added the historic Normandie Hotel to its hospitality property portfolio in December 2006 (CB Dec. 21, 2006), joining the
Ritz-Carlton San Juan Hotel Spa & Casino and Radisson Ambassador Plaza Hotel & Casino.