News Releases

(ORLANDO, Fla.) May 14, 2014 — CNL Lifestyle Properties, Inc., a real estate investment trust (“we,” “our” or “us”), today announced its operating results for the first quarter ended March 31, 2014.

First Quarter 2014

• Total revenues increased $8 million or 8.9 percent as compared to the first quarter of 2013.
• Net loss decreased $2.9 million or 12.6 percent as compared to the first quarter of 2013.   Excluding impairment charges, net loss improved $6.3 million or 26.9 percent as compared to the first quarter of 2013.
• Funds from Operations (“FFO”) and FFO per share increased $2.6 million and $0.01 per share, respectively, as compared to the first quarter of 2013 primarily as a result of an increase in rental income from leased properties acquired after the first quarter of 2013.
• Modified Funds from Operations (“MFFO”) increased $0.2 million with no change to MFFO per share, as compared to the first quarter of 2013.
• Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) decreased $7.4 million or 21 percent as compared to the first quarter of 2013 primarily as a result of a reduction in cash distributions received from our unconsolidated entities due to the July 2013 sale of our interests in 42 properties that were held in three unconsolidated entities.
• In March 2014, we engaged Jefferies LLC, a leading global investment banking and advisory firm, to assist in actively evaluating various strategic opportunities including the sale of either us or our assets, potential merger opportunities, or the listing of our common stock.

The following table presents selected comparable financial data through March 31, 2014:

SUMMARY FINANCIAL RESULTS
(Millions except ratios and per share data)
	Quarter ended
	March 31,
	2014	2013
Total revenues	$          97.7	$          89.7
Total expenses	101.7	94.3
Operating loss	(4.0)	(4.6)
Net loss	(20.4)	(23.3)
Net loss per share	(0.06)	(0.07)
FFO	21.6	18.9
FFO per share	0.07	0.06
MFFO	19.3	19.1
MFFO per share	0.06	0.06
Adjusted EBITDA	27.6	35.0
Cash flows from operating activities	37.6	48.6
As of March 31, 2014:
Total assets	$     2,718.8
Total debt	1,248.0
Leverage ratio	45.9%
* 49.0% including our share of unconsolidated assets and debts

See detailed financial information and full reconciliation of FFO, MFFO and Adjusted EBITDA, which are Non-Generally Accepted Accounting Principles (“Non-GAAP”) measures, on the following pages

Portfolio Highlights

The following tables summarize the Company’s “same-store” comparable consolidated properties that we have owned during the entirety of both periods presented, and includes information for both leased and managed properties (other than for rent coverage, which includes all leased properties):

First Quarter 2014

	Number		Quarter Ended March 31,												TTM
	of		2014				2013				Increase/(Decrease)				Rent
	Properties		Revenue		EBITDA *		Revenue		EBITDA *		Revenue		EBITDA		Coverage *
Ski and mountain lifestyle	17		$ 241,579		$ 110,312		$ 256,246		$ 119,893		-5.7%		-8.0%		1.35x
Golf	48		34,007		9,018		34,339		9,038		-1.0%		-0.2%		1.37x
Attractions	21		22,727		(8,595)		21,111		(9,755)		7.7%		11.9%		1.92x
Senior housing	20		17,263		5,207		16,675		5,475		3.5%		-4.9%		n/a
Marinas	17		5,289		1,248		6,046		2,140		-12.5%		-41.7%		0.57x
Additional lifestyle	1		1,704		912		1,195		541		42.6%		68.6%		n/a
	124		$ 322,569		$ 118,102		$ 335,612		$ 127,332		-3.9%		-7.2%		1.39x

*As of March 31, 2014, on a trailing 12-month (“TTM”) basis for all properties subject to lease calculated as property-level EBITDA before recurring capital expenditures divided by base rent.

• As of May 6, 2014, we owned a portfolio of 146 lifestyle properties of which 54 properties are held for sale, including our portfolio of 48 golf courses.
• Revenue and property-level EBITDA declined 3.9 percent and 7.2 percent, respectively, as compared to the same first-quarter period in 2013.
• Drought and unusually warm temperatures, particularly in California and the Pacific Northwest, caused certain ski and mountain lifestyle properties to experience poor operating results during the 2013/2014 season compared to the 2012/2013 season.  
• Our senior housing communities, on average, experienced increases in Occupancy and revenue per occupied unit (“RevPOU”), which increased property operating revenue for our portfolio; however, in certain locations severe winter storms forced staff to stay at facilities over multiple nights, resulting in overtime labor costs as well as unanticipated repairs and snow removal costs.  These cost increases led to a decrease in portfolio EBITDA despite the increase in revenue, however, these assets largely continued to perform well. 

The following table presents same-store, unaudited property-level information of our senior housing properties as of and for the quarters ended March 31, 2014, and 2013:

			Occupancy						RevPOU
			As of						Quarter Ended
	Number		March 31,				Increase/		March 31,				Increase/
	of Properties		2014		2013		Decrease		2014		2013		Decrease
Senior housing	20		95.8%		95.3%		0.5%		$3,816		$3,744		1.9%

Acquisition Activity

During the quarter ended March 31, 2014, we acquired one senior housing community located in Cranston, Rhode Island, for an aggregate purchase price of $15.3 million. 

Distributions

For the quarter ended March 31, 2014, we declared and paid distributions of approximately $34.3 million ($0.1063 per share). Our Board of Directors will continue to evaluate the level of distributions going forward, which will be based on a variety of factors including current and expected future cash flows from our properties.

Stock Issuance and Redemptions

For the quarter ended March 31, 2014, we issued approximately 2 million shares for total net proceeds of $13.6 million and redeemed 0.4 million shares with a value of approximately $3 million.  

Supplemental Information

See our quarterly report on Form 10-Q for the quarter ended March 31, 2014 on our website at www.CNLLifestyleREIT.com for additional information.

CNL LIFESTYLE PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

	March 31,		December 31,
	2014		2013
ASSETS
Real estate investment properties, net (including $181,616 and $184,306
related to consolidated variable interest entities, respectively)	$     1,758,850		$     2,068,973
Assets held for sale, net	417,057		90,794
Investments in unconsolidated entities	133,638		132,324
Mortgages and other notes receivable, net	117,838		117,963
Cash	86,490		71,574
Deferred rent and lease incentives	56,469		57,378
Other assets	53,849		52,310
Restricted cash	49,154		51,335
Intangibles, net	27,105		36,922
Accounts and other receivables, net	18,338		21,080
Total Assets	$     2,718,788		$     2,700,653
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgages and other notes payable (including $93,788 and $87,095 related to
non-recourse debt of consolidated variable interest entities, respectively)	$        803,476		$        760,192
Senior notes, net of discount	394,502		394,419
Line of credit	50,000		50,000
Other liabilities	85,957		76,816
Accounts payable and accrued expenses	59,489		49,823
Due to affiliates	921		1,025
Total Liabilities	1,394,345		1,332,275
Stockholders’ equity:
Preferred stock, $.01 par value per share 200 million shares authorized and unissued	-		-
Excess shares, $.01 par value per share 120 million shares authorized and unissued	-		-
Common stock, $.01 par value per share
One billion shares authorized; 347,102 and 345,114 shares issued and 324,180
and 322,627 shares outstanding as of March 31, 2014 and December 31, 2013,
respectively	3,242		3,226
Capital in excess of par value	2,856,898		2,846,265
Accumulated deficit	(422,338)		(401,985)
Accumulated distributions	(1,107,700)		(1,073,422)
Accumulated other comprehensive loss	(5,659)		(5,706)
Total Stockholders’ Equity	1,324,443		1,368,378
Total Liabilities and Stockholders’ Equity	$     2,718,788		$     2,700,653

CNL LIFESTYLE PROPERTIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

                                                  (in thousands, except per share data)    

	Quarter Ended
	March 31,
	2014		2013
Revenues:
Rental income from operating leases	$      42,854		$      39,470
Property operating revenues	51,668		46,803
Interest income on mortgages and other notes receivable	3,133		3,419
Total revenues	97,655		89,692
Expenses:
Property operating expenses	51,004		47,252
Asset management fees to advisor	8,571		9,213
General and administrative	3,996		3,993
Ground lease and permit fees	3,643		4,002
Acquisition fees and costs	724		367
Other operating expenses	763		678
Bad debt expense	1,006		26
Depreciation and amortization	&