As part of the termination agreement, Nashville-based GaylordEntertainment is incurring a one-time charge of $12 million.In November2007, Gaylord had entered into an agreement to acquire theresort at 16641 La Cantera Pkwy. and an adjacent 90 acres fromUSAA/La Cantera Development Co. of San Antonio and Starwood Hotels& Resorts Worldwide Inc. of White Plains, NY.

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"Gaylord currently has properties pretty well spread out andthat's how they've operated," says John M. Keeling, senior vicepresident for PKF Consulting in Houston. He adds that the GaylordTexan & Conference Center in the Dallas/Fort Worth metroplexmight have influenced the decision. "They might have had secondthoughts about having two properties that close together in Texas,"he speculates.

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Keeling acknowledges Gaylord Entertainment is paying a stifftermination fee, but the $12 million pales in comparison to what itwould have paid to own and upgrade the Hill Country Resort. Keelingpoints out that, in addition to doing upgrades on the property,more rooms were planned.

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In its statement about the termination, the economy was cited asthe impetus for the decision. "Over the past several months, weheld fruitful discussions with a variety of potential partners.However, in the current capital markets and economic environment,we determined that it is not in the best interest of ourshareholders to focus our resources and capital on this project atthis time," Colin V. Reed, Gaylord's chairman and CEO, says in thepress release. Calls to Gaylord Entertainment were not returned bypress time.

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Keeling says financing troubles could definitely have been oneof the factors behind the termination. "The cost and availabilityof capital has been severely impacted by the subprime situation,"he stresses to GlobeSt.com. "There's still a lot of equityavailable, but what's not available is debt."

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Keeling cautions, however, that things aren't as dire asportrayed. "Financing is tight. We're in a recession. But, theeconomy is far from being in the tank," he adds. "We're not seeingany evidence of slowdown based on our own business volume."

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