Kingdom Hotel Investments (“KHI”) Preliminary results for the twelve months to December 31, 2006

Kingdom Hotel Investments (ticker: KHIq), the leading international hotel and resort investment company focused on high growth emerging markets, today reports its preliminary results for the year ended December 31, 2006 – a year of substantial expansion and delivery.

Financial Highlights

Strong revenue and profit growth demonstrate the strength of KHI’s business model

§         Revenue up 68 per cent to US$99.0 million (2005: US$58.8 million)

§         Gross profit up 24 per cent to US$14.3 million (2005: US$11.5 million)

§         EBITDA up by 67 per cent to US$30.0 million (2005: US$18.0 million)

§         Net Income up by 248 per cent to US$42.8 million (2005: US$12.3 million)

§         EPS up 53 per cent to US$0.26 (2005: US$0.17)¹

§         Primary listing on DIFX and GDS’s on LSE following successful IPO in March 2006

Operational Highlights

Accelerated global expansion combined with sound performance from the majority of existing assets

·         Leveraged competitive advantage to increase portfolio by more than 50% to a total of 33 hotels

-          Exceeded target of six acquisitions a year with agreements to acquire and/or develop 11 hotels in nine territories including five new developments

-          Acquired interests in US$1.4 billion worth of hotels and projects comprising ancillary real estate

-          Origination offices opened in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Singapore and South Africa

·         Generally strong performance across the operating portfolio despite impact of local conditions on three operating hotels:

-          As announced on 7 March, following the war in Lebanon, difficult trading conditions in Beirut continued in the second half of 2006 and there was a corresponding impact on trading at the Four Seasons Hotel in Damascus. Softer than expected market conditions have also affected the trading performance of KHI’s operating assets in the Red Sea and Mauritius

-          Having implemented a significant risk mitigation strategy, Four Seasons Hotel Beirut is now expected to be completed in second half of 2008

-          Strong operating performance of Four Seasons Hotel Cairo at Nile Plaza, Four Seasons Hotel George V in Paris and Mövenpick Hotel Bur Dubai driven by substantial RevPar growth

·         Increased focus on acquisitions with a significant ancillary branded real estate opportunity including Four Seasons Private Residences Marrakech, Four Seasons Mauritius and Bur Dubai Residence

·         Continued progress in consolidating minority interests and increasing control of prime hotel assets including, Four Seasons Hotel Cairo at Nile Plaza, Four Seasons Hotel Damascus and the proposed Fairmont Palm Hotel Dubai

·         Enhanced capabilities since IPO - strengthened finance capabilities with appointment new Senior Vice President, Finance and Chief Financial Officer in November 2006

¹Using weighted average number of shares (2005: 71.8 million; 2006: 163.7 million)

Outlook

·         KHI is well positioned to continue to leverage its competitive advantage and build its portfolio in high growth emerging markets

·         Momentum has increased in 2007 with acquisitions in Malaysia, Vietnam and the Philippines

-          February 2007: Proposed Raffles Resort, Da Nang, Vietnam

-          March 2007: Four Seasons Resort, Langkawi island of Malaysia

-          March 2007: Proposed Fairmont Manila Hotel and Raffles Suites, Manila, Philippines

·         The operating outlook across the portfolio is strong, except in Beirut where conditions are expected to remain challenging

·         KHI is committed to invest in people and systems to support its growth strategy

·         Balance sheet liquidity remains high with potential for further additional leverage to fund growth

·         KHI will continue to source projects with ancillary real estate components

Commenting on the results, Chairman HRH Prince Alwaleed Bin Talal said:

“KHI continues to successfully execute its dynamic expansion strategy in high growth emerging markets while delivering a robust performance from its existing assets despite challenging conditions in specific markets. In 2007, KHI has already identified and secured some key unique assets in target markets and continues to drive our fast paced expansion strategy in emerging territories.”

Chief Executive Officer Sarmad Zok said:

“Our financial performance in 2006 demonstrates the strength of KHI’s business model and our characteristics as a high growth company with an average of one acquisition per month last year. Our strategy is to continue to diversify and extend our operating base focusing on properties in global emerging and high growth markets. We have built up a strong, diversified and resilient asset base. I am delighted with the outlook on our development pipeline in emerging territories, particularly in Asia. We have accentuated our investment focus on branded ancillary real estate and continue to invest in people and systems to support KHI’s growth.”

Enquiries

Brunswick Group

Kate Holgate / Laura Cummings / Sophie Brand                                                                               +44 207 404 5959

About Kingdom Hotel Investments

KHI, headquartered in Dubai (UAE), is a leading international hotel and resort acquisition and development company focused on high growth emerging markets such as the Middle East, Asia, Africa and Europe.

The company has ownership interests in 33 properties in 16 countries including 19 operational hotels and resorts and 12 hotels and resorts currently under construction or as part of existing hotel expansion. KHI is listed on the Dubai and London stock exchanges.

Financial Performance

KHI’s strong revenue and profit growth in the year to December 31, 2006 demonstrate the Company’s strong business model and its ability to build on this as it grows its asset base.

·         KHI’s revenues increased by 68 per cent for the year ended December 31, 2006 to reach US$99.0 million, representing a 61 per cent cumulative average growth rate since 2004

·         KHI’s EBITDA for the year ended December 31, 2006 increased by 67 per cent to reach US$30.0 million, representing a 85 per cent cumulative average growth rate since 2004

·         KHI’s net income increased by 248 per cent in 2006 to reach US$42.8 million, representing a 211 per cent cumulative average growth rate since 2004

·         KHI’s total assets increased by 86 per cent as at December 31, 2006 to reach US$1,477.8 million from US$795.3 million as at December 31, 2005, representing a 72 per cent cumulative average growth rate since 2004

·         KHI’s total shareholders’ equity increased by 107 per cent as at December 31, 2006, to reach US$1,108.0 million from US$536.1 million as at December 31, 2005, representing a 102 per cent cumulative average growth rate since 2004

KHI selected highlights:

*     Includes all available rooms from consolidated and associates entities

**   Includes depreciation expenses

*** Excludes depreciation expense already included in the gross profit figure

Portfolio Review – Operating hotels

The portfolio review includes consolidated and associate operating properties but excludes the affiliate property of the Four Seasons Hotel Amman.