The hotels are predominantly located in established city centerlocations across the UK, with a weighting towards London, accordingto Land Securities. As part of the deal, Accord will operate thehotels under 12-year variable leases and the new owner will invest68.67 million (euro 53 million) to upgrade the properties.

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The leases are renewable six times, for a total of 84 years. Theassociated rents will be based on an average 21% of annual revenueswith no guaranteed minimum. The variable rent for 2006 would haveamounted to $53.12 million (euro 41 million).

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Land Securities is a FTSE 100 company with a market value ofmore than $19.44 billion (euro 15 billion). The company ownsproperty assets in England, Scotland and Northern Ireland.

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Accor operates 4,000 hotels in nearly 100 countries with 160,000employees. The sale will enable Accor to reduce its adjusted netdebt by $756.87 million (euro 584 million). Accor's financialadvisers were NM Rothschild & Sons; its legal and tax adviserwas CMS Cameron Mc Kenna.

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