Sunstone Hotel Investors Provides Business Update

Sunstone Hotel Investors, Inc. (the "Company") (NYSE:SHO) today provided an update on its recent operating performance, acquisitions process, independent hotel management request for proposals and finance transactions. The preliminary financial information for the fiscal quarter and year ended December 31, 2009 reflects selected preliminary results from the Company's unaudited financial statements, and is subject to customary adjustments that may arise during the completion of the financial statement close process.

Arthur Buser, President and Chief Executive Officer, stated, "On the operations front, we are seeing a moderation in the decline of RevPAR, and we continue to drive operational efficiencies throughout our portfolio. With respect to acquisitions, we believe now is the beginning of an optimal phase in the cycle for offense. Accordingly, we continue to evaluate numerous potential opportunities to acquire quality hotels at discount valuations. At the same time, we continue to execute on various finance initiatives designed to reduce corporate risk and provide capacity to capitalize on investment opportunities. We are steadfast in our resolve to consistently do what's best for our stockholders. Our objective is to outperform, and we believe that by being nimble, well-capitalized and decisive we will continue to create significant long-term stockholder value."

Operations Update

RevPAR information presented reflects the 26 hotel portfolio on a pro forma basis. The 26 hotel portfolio excludes 13 hotels which, as described more fully below, were, or are in the process of being, conveyed to receivers pursuant to deed-back transactions.

Preliminary Operations Update Through December 31, 2009 (26 Hotel Portfolio):

- Fourth quarter total portfolio RevPAR was $97.85, down 14.1% to prior year.

- Full year total portfolio RevPAR was $102.71, down 18.5% to prior year.

                  Three Months Ended December 31, 2009 (estimated)

                  ------------------------------------------------

                                       Marriott     Mass          Pro

              Total      Renaissance    Ontario    Mutual        Forma

          Portfolio (1)   Westchester   Airport   Portfolio  Portfolio (2)

          -------------  ------------  ---------  ---------  -------------

  Number

   of

   Hotels       39             1           1         11             26

  Number

   of

   Keys     13,546           347         299      2,587         10,313

  Avg

   keys/

   Hotel       347           347         299        235            397

  Occ%        65.9%         60.3%       62.4%      65.2%          66.3%

  ADR      $140.27       $142.99      $93.02    $112.98        $147.59

  RevPAR    $92.44        $86.22      $58.04     $73.66         $97.85







                        Three Months Ended December 31, 2008

                        ------------------------------------

                                       Marriott     Mass          Pro

              Total      Renaissance    Ontario    Mutual        Forma

          Portfolio (1)   Westchester   Airport   Portfolio  Portfolio (2)

          -------------  ------------  ---------  ---------  -------------

  Number

   of

   Hotels       39             1           1         11             26

  Number

   of

   Keys     13,546           347         299      2,587         10,313

  Avg

   keys/

   Hotel       347           347         299        235            397

  Occ%        67.5%         62.9%       63.8%      69.1%          67.5%

  ADR      $159.99       $168.56     $104.01    $126.96        $168.72

  RevPAR   $107.99       $106.02      $66.36     $87.73        $113.89







                      Year Ended December 31, 2009 (estimated)

                      ----------------------------------------

                                       Marriott     Mass          Pro

              Total      Renaissance    Ontario    Mutual        Forma

          Portfolio (1)   Westchester   Airport   Portfolio  Portfolio (2)

          -------------  ------------  ---------  ---------  -------------

  Number

   of

   Hotels       39             1           1         11             26

  Number

   of

   Keys     13,546           347         299      2,587         10,313

  Avg

   keys/

   Hotel       347           347         299        235            397

  Occ%        69.2%         60.3%       64.4%      71.0%          69.2%

  ADR      $141.32       $142.21      $94.92    $118.55        $148.42

  RevPAR    $97.79        $85.75      $61.13     $84.17        $102.71







                            Year Ended December 31, 2008

                            ----------------------------

                                       Marriott     Mass          Pro

              Total      Renaissance    Ontario    Mutual        Forma

          Portfolio (1)   Westchester   Airport   Portfolio  Portfolio (2)

          -------------  ------------  ---------  ---------  -------------

  Number

   of

   Hotels       39             1           1         11             26

  Number

   of

   Keys     13,546           347         299      2,587         10,313

  Avg

   keys/

   Hotel       347           347         299        235            397

  Occ%        74.4%         66.3%       73.5%      75.2%          74.5%

  ADR      $161.22       $171.09     $114.05    $134.16        $169.09

  RevPAR   $119.95       $113.43      $83.83    $100.89        $125.97



  (1) Includes the hotels owned by the Company as of December 31, 2009,

      excluding the W San Diego which has been deconsolidated and included

      in discontinued operations due to the transfer of possession and

      control of the hotel to a receiver on September 30, 2009.

  (2) Includes the hotels owned by the Company as of December 31, 2009,

      excluding the W San Diego and the Renaissance  Westchester which have

      been deconsolidated and included in discontinued operations due to the

      transfer of possession and control of the hotels to receivers on

      September 30, 2009 and December 28, 2009, respectively, as well as the

      Marriott Ontario Airport and the 11 hotels included in the Mass Mutual

      portfolio, which have been reclassified to "operations held for non-

      sale disposition."