Fitch Ratings-New York-18 May 2007: Fitch Ratings has upgraded the foreign currency and local currency Issuer Default Ratings (IDR) of Grupo Posadas, S.A.B. de C.V. (Posadas) as well as the issue rating on Posadas' US$225 million senior notes due 2011 to 'BB' from 'BB-'. Fitch has also upgraded the national scale rating of Posadas to 'A+(mex)' from 'A(mex)' including MXN250 million 'Certificados Bursatiles' issuance due 2009. The Rating Outlook is Stable.

The rating action reflects continued improvement in the company's financial profile and credit protection measures as a result of gradual debt repayment and adequate operating erformance. Over the past few years, Posadas has steadily increased room capacity and maintained relatively stable occupancy and REVPAR (revenue per available room) levels, resulting in gradual increasesin revenues, EBITDAR and cash flow generation. Despite arious challenges, including the crisis following Sept. 11, 2001, periods of weak economic growth in Mexico and the U.S., and more recently, the strike of Hurricane Wilma in the Yucatan peninsula during 2005, the company hasdemonstrated ability to perform rofitably, grow revenues and earn positive free cash flow, which has allowed it to repay debt and gradually improve credit protection measures. Over the next several quarters, the company should reach and maintain a ratio of total adjusted debt to operating EBITDAR of approximately 3.0 times(x) or below, consistent with the new rating category.

The ratings reflect the company's solid business position, strong brand name and multiple hotel formats. Posadas' presence in all major urban and coastal locations in Mexico, consistent product offering and quality brand image have resulted in occupancy levels that are above the industry average in Mexico. The use of multiple hotel formats allows the company to target domestic and international business travelers as well as tourists. Operations are primarily located in Mexico, which limits geographic diversification. The business strategy is focused on managing and leasing hotel properties as opposed to owning, allowing the company to grow with relatively low capital investments and related borrowing. Revenues from the vacation club have increased steadily in recent years and are expected to account for a growing percentage of revenues in the near to medium term. Posadas faces a comfortable debt maturity schedule and has a track record of positive free cash flow generation.

During 2006, revenues were flat from the prior year, affected primarily by the closing of five Posadas hotels in the Yucatan peninsula that were damaged by Hurricane Wilma in October 2005. Four of these hotels reopened during the first quarter of 2006 but one remains to open. Notwithstanding, EBITDA grew during the year to US$126 million from US$117 million in 2005. During the first three months of 2007, revenues grew by 7% driven primarily by increases in the average daily rate for urban and costal hotels both owned and managed. This was partially offset by a decline in the average number of rooms in coastal hotels due to sale of a hotel and the conversion of another to the Vacation Club. EBITDA registered a decline of 9% during the quarter which was primarily attributable to the extraordinary income registered during 1Q06 related to (i) recovery under business interruptions due to Hurricane Wilma and (ii) proceeds from the sale of two hotels.

At March 31, 2007, on-balance sheet debt reached US$382 million of which 81% was dollar-denominated and the remainder was in pesos. The debt was comprised of US$225 million senior notes due 2011, a US$80 million equivalent peso/dollar dual-currency credit facility due 2010, US$50 million of secured bank debt and US$27 million of other debt. In addition, the company had US$130 million of off-balance sheet debt related to hotel leases. The company has comfortable liquidity with a balance of cash and marketable securities of US$57 million at March 31, 2007. The ratio of total adjusted debt to EBITDAR reached 3.6 times (x) during 2006, an improvement from 3.8x from 2005. Adjusted interest coverage measured by the ratio of EBITDAR to financial expense plus rent expense, was 2.6x. In 2007 and 2008, Posadas is expected EBITDA growth to be driven by higher revenues from the incorporation of new managed hotels and from the Fiesta Americana Vacation Club. With debt levels expected to remain stable due to relatively low capital investment requirements, this should translate into a gradual improvement in credit protection measures.

Capital expenditures reached US$31 million in 2006, related to maintenance, conversion of hotels to the Vacation Club format and technology updates. During the year, the company opened seven new hotels (five in Mexico one in Santiago, Chile and one in northern Brazil). Over the next three years, Posadas plans to open approximately 40 new hotels, which will require a cash outlay by the company of approximately US$13 million or 4% of the total estimated investment of US$335 million, as the vast majority of new openings will be under management and lease agreements.

Grupo Posadas is the largest hotel operator in Mexico, with 96 hotels and 18,041 rooms across Mexico (82% of total rooms), Brazil (12%), United States (4%), Argentina (1%) and Chile (1%). Approximately 75% of rooms are in urban locations, with the remaining 25% in coastal destinations. The company manages different hotel formats (under a combination of owned, leased and managed properties) that include Fiesta Americana, Fiesta Inn and One Hotels in Mexico, and Caesar Park and Caesar Business in Brazil, Argentina and Chile. The company owns a minority equity stake (30%) in Grupo Mexicana de Aviacion S.A. de C.V. (Mexicana), one of Mexico's two largest commercial airlines. The company believes its investment in Mexicana brings strategic advantages and synergies in information, technology, commercialization and marketing and strengthens their leadership in the Mexican tourism sector. For the year ended Dec. 31, 2006 Posadas had US$484 million of revenues and US$126 million of EBITDA.

Contact: Giovanna Caccialanza, CFA +1-212-908-0898, New York; or Sergio Rodriguez, CFA +52 81 8335 7179, Monterrey, Mexico.

Media Relations: Christopher Kimble, New York, Tel: +1 212-908-0226.

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About Grupo Posadas

Grupo Posadas has 35 years of experience in the hotel market and operates 94 hotels with more than 17,000 rooms in 50 beach and city destinations in Mexico, United States, Brazil, Argentina and Chile. In Mexico, it operates 20 percent of the rooms in the chain tourist category. Its five hotel brands in Mexico—Aqua, Fiesta Americana Grand, Fiesta Americana, Fiesta Inn and One Hotels—plus another two in South America—Caesar Park and Caesar Business—make it the leading Mexican hotel company in Latin America. Grupo Posadas has been trading on the Mexican Stock Market since 1992, under the ticker symbol POSADAS, and may be visited at its Web site www.posadas.com.