SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

~~[X]~~x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE ~~SECURITIES EXCHANGE ACT OF 1934.~~

~~For~~SECURITIES ~~the~~EXCHANGE ~~quarterly~~ACT ~~period~~OF ~~ended September 6, 2002~~1934.

For the quarterly period ended June 20, 2003.

~~[_]~~¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE ~~SECURITIES EXCHANGE ACT OF 1934~~

SECURITIES EXCHANGE ACT OF 1934

Commission File No. 0-16728

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP

(Exact Name of Registrant as Specified in Its Charter)

Delaware		52-1533559
(State of Incorporation)		(I.R.S. Employer Identification No.)
6903 Rockledge Drive, Suite 1500, Bethesda, Maryland		20817
(Address of Principal Executive Offices)		(Zip Code)

6903 Rockledge Drive, Suite 1500,

Bethesda, Maryland

20817

(Address of Principal Executive Offices)

(Zip Code)

(240) 744-1000

(Registrant’s telephone number, including area code)

~~10400~~Indicate ~~Fernwood Road,~~by ~~Bethesda,~~check ~~Maryland~~mark ~~20817~~whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act) ¨ Yes x No

Indicate by check mark whether the registrant (~~Former~~1) ~~name,~~has ~~former~~filed ~~address~~all ~~and~~reports ~~former~~required ~~fiscal~~to ~~year,~~be iffiled ~~changed~~by ~~since~~Section ~~last~~13 ~~report~~or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No

~~Indicate~~The ~~by check mark whether the~~ registrant (had 1),470 ~~has~~units ~~filed~~of ~~all~~its ~~reports~~common ~~required~~limited partnership tounits beoutstanding ~~filed~~as ~~by Section 13 or 15(d)~~ of ~~the~~August ~~Securities Exchange Act of 1934 during the preceding 12 months~~4, ~~and (2) has been subject to such filing requirements for the past 90 days~~2003.

x Yes ¨ No

Indicate the number of units outstanding as of the latest practicable date.

The registrant had 1,470 units of its common limited partnership units outstanding as of October 15, 2002.

INDEX

PART I. FINANCIAL INFORMATION

		Page No.

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited):

	Condensed Consolidated Balance Sheets—June 20, 2003 and December 31, 2002	1

	Condensed Consolidated Statements of Operations—Quarter Ended and Year-to-Date June 20, 2003 and June 14, 2002	2

	Condensed Consolidated Statements of Cash Flows—Year-to-Date June 20, 2003 and June 14, 2002	3

	Notes to Condensed Consolidated Financial Statements	4

Item 2.	Management’s Discussion and Analysis of financial Condition and Results of Operations	6

Item 3.	Quantitative and Qualitative Disclosures about Market Risk.	10

Item 4.	Controls and Procedures	10

PART II.	OTHER INFORMATION AND SIGNATURE

Item 6.	Exhibits	11

		Page No.
Item 1.	Financial Statements (Unaudited):
	Condensed Consolidated Balance Sheets—September 6, 2002 and December 31, 2001	1
	Condensed Consolidated Statements of Operations—Twelve Weeks and Thirty-six Weeks Ended September 6, 2002 and September 7, 2001	2
	Condensed Consolidated Statements of Cash Flows—Thirty-six Weeks Ended September 6, 2002 and September 7, 2001	3
	Notes to Condensed Consolidated Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Results of Operations and Financial Condition	7
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	11
Item 4.	Controls and Procedures	11
	PART II. OTHER INFORMATION AND SIGNATURE
Item 1.	Legal Proceedings	11

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

	September 6, 2002			December 31, 2001
	June 20, 2003			December 31, 2002
		(Unaudited)
	(unaudited)
ASSETS
Property and equipment, net	$	~~404~~396,~~661~~424		$	~~418~~401,~~885~~776
Deferred financing costs, net of accumulated amortization		87,~~459~~250			97,~~547~~975
Due from Courtyard Management Corporation		8,~~888~~965			96,~~117~~387
Other assets		1110			—1
Property improvement fund		3940,~~093~~830			3039,~~513~~396
Restricted cash		2422,~~837~~625			2220,~~535~~969
Cash and cash equivalents		28,~~789~~483			108,~~489~~051
	$	~~488~~484,~~738~~587		$	~~501~~484,~~086~~555
LIABILITIES AND PARTNERS’ CAPITAL (DEFICIT)
LIABILITIES
Debt	$	~~435~~420,~~882~~789		$	~~448~~429,~~605~~278
Management fees due to Courtyard Management Corporation		5057,~~393~~763			4353,~~288~~142
Due to Marriott International, Inc. and affiliates		8,491			8,574
Due to Marriott International, Inc. and its affiliates		11,615			8,594
Accounts payable and accrued liabilities		1015,~~645~~371			1213,~~389~~450
Total Liabilities		505,~~411~~538			~~512~~504,~~856~~464
PARTNERS’ CAPITAL (DEFICIT)
General Partner		98,~~061~~848			98,~~307~~900
Limited Partners		(2529,~~734~~799	)		(2128,~~077~~809	)
Total Partners’ Deficit		(1620,~~673~~951	)		(1119,~~770~~909	)
	$	~~488~~484,~~738~~587		$	~~501~~484,~~086~~555

See ~~Notes~~notes to ~~Condensed~~condensed consolidated ~~Consolidated~~financial ~~Financial Statements~~statements.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(~~Unaudited~~unaudited, in thousands, except ~~Unit~~unit and ~~Per~~per ~~Unit~~unit ~~Amounts~~amounts)

	Twelve Weeks Ended						Thirty-Six Weeks Ended
	Quarter Ended						Year-to-Date
	September 6, 2002			September 7, 2001			September 6, 2002			September 7, 2001
	June 20, 2003			June 14, 2002			June 20, 2003			June 14, 2002
REVENUES
Rooms	$	5553,~~372~~435		$	6057,~~547~~527		$	~~165~~104,~~108~~812		$	~~189~~109,~~037~~736
Food and beverage		3,~~378~~689			3,~~632~~656			106,~~369~~962			116,~~550~~991
Other		~~1,260~~898			21,~~082~~264			31,~~855~~937			52,~~997~~595
Total revenues		60,010			66,261			179,332			206,584
Total hotel revenues		58,022			62,447			113,711			119,322
OPERATING COSTS AND EXPENSES
Rooms		12,~~684~~021			1312,~~605~~726			3723,~~177~~972			4124,~~668~~493
Food and beverage		2,~~866~~898			32,~~306~~953			85,~~636~~763			105,~~462~~770
Other property-level costs and expenses		552			417			1,600			1,531
Selling, administrative and other		15,857			15,650			31,507			30,450
Selling, administrative and other		15,215			15,752			44,617			48,994
Depreciation		5,907			6,003			11,767			12,140
Depreciation		5,934			6,443			18,074			19,488
Ground rent		2,781			2,853			5,603			5,667
Ground rent		2,884			3,104			8,552			9,433
Property taxes		2,729			2,798			5,558			5,638
Property taxes		2,821			2,704			8,459			8,373
Partnership expense		316			208			527			465
Partnership administration		284			78			779			351
Insurance and other		490			605			1,023			1,052
Insurance and other		546			384			1,567			1,402
Management fees		5,616			6,374			10,905			11,986
Base and Courtyard management fees		3,601			3,976			10,760			12,395
Total operating costs and expenses		48,615			50,170			96,625			97,661
Incentive management fee		2,278			2,854			7,105			9,043
OPERATING PROFIT		9,407			12,277			17,086			21,661
OPERATING PROFIT		10,345			13,638			32,006			43,444
Interest expense		(8,883	)		(9,284	)		(18,291	)		(18,422	)
Interest expense		(9,047	)		(9,458	)		(27,469	)		(28,566	)
Interest income		93			127			163			233
Interest income		183			416			416			1,117
NET INCOME (LOSS)	$	617		$	3,120		$	(1,042	)	$	3,472
NET INCOME	$	1,481		$	4,596		$	4,953		$	15,995
ALLOCATION OF NET INCOME (LOSS)
ALLOCATION OF NET INCOME
General Partner	$	31		$	156		$	(52	)	$	174
General Partner	$	74		$	230		$	248		$	800
Limited Partners		586			2,964			(990	)		3,298
Limited Partners		1,407			4,366			4,705			15,195
	$	617		$	3,120		$	(1,042	)	$	3,472
	$	1,481		$	4,596		$	4,953		$	15,995
NET INCOME (LOSS) PER LIMITED PARTNER UNIT (1,470 Units)	$	399		$	2,016		$	(673	)	$	2,244
NET INCOME PER LIMITED PARTNER UNIT (1,470 Units)	$	957		$	2,970		$	3,201		$	10,337

See ~~Notes~~notes to ~~Condensed~~condensed consolidated ~~Consolidated~~financial ~~Financial Statements~~statements.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(~~Unaudited~~unaudited, in thousands)

	Thirty-six Weeks Ended
	Year-to-Date
	September 6, 2002			September 7, 2001
	June 20,2003			June 14,2002
OPERATING ACTIVITIES
Net income	$	4,953		$	15,995
Net income (loss)	$	(1,042	)	$	3,472
Depreciation expense		1811,~~074~~767			1912,~~488~~140
Gain on disposition of fixed assets		—			(4	)
Amortization of deferred financing costs as interest expense		725			725
Amortization of deferred financing fees		1,088			1,088
Straight-line rent adjustment		(55	)		(55	)
Changes in operating accounts		3,184			(5,456	)
Changes in operating accounts:
Cash provided by operating activities		27,299			31,111
Due from Courtyard Management Corporation		(2,578	)		943
Other assets		(9	)		(3	)
Management fees due to Courtyard Management Corporation		4,621			4,828
Due to Marriott International, Inc. and their affiliates		3,076			—
Accounts payable and accrued liabilities		1,921			409
Cash provided by operating activities		18,426			22,459
INVESTING ACTIVITIES
Additions to property and equipment, net		(36,~~850~~415	)		(32,~~538~~171	)
Change in property improvement funds		(8,580	)		(10,512	)
Contributions to the property improvement fund		(7,391	)		(7,756	)
Cash used in investing activities		(12,430	)		(14,050	)
Distributions from the property improvement fund		5,957			1,624
Cash used in investing activities		(7,849	)		(8,303	)
FINANCING ACTIVITIES
Repayments of debt		(128,~~723~~489	)		(117,~~807~~878	)
Changes in debt service reserve		10			—
Increase in restricted cash		(1,656	)		(4,022	)
Capital distributions		~~(9,856~~—	)		(127,~~874~~382	)
Cash used in financing activities		(2210,~~569~~145	)		(2419,~~681~~282	)
DECREASE IN CASH AND CASH EQUIVALENTS		(7,700	)		(7,620	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		432			(5,126	)
CASH AND CASH EQUIVALENTS at beginning of period		108,~~489~~051			1310,~~511~~489
CASH AND CASH EQUIVALENTS at end of period	$	28,~~789~~483		$	5,~~891~~363
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for mortgage and other interest	$	30,313		$	31,162
Cash paid for interest	$	16,661		$	17,305

See ~~Notes~~notes to ~~Condensed~~condensed consolidated ~~Consolidated~~financial ~~Financial Statements~~statments.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(~~Unaudited~~unaudited)

Organization

Courtyard by Marriott II Limited Partnership and Subsidiaries ~~(the “Partnership”)~~, a Delaware limited partnership, was formed on August 31, 1987 to acquire and own 70 Courtyard by Marriott hotels and the land on which certain of the hotels are located. The ~~Partnership’s~~hotels ~~70 hotel properties~~ are located in 29 states in the United States. ~~The~~and ~~hotels~~ are managed as part of the Courtyard by Marriott hotel system by Courtyard Management Corporation, (or the ~~“Manager”)~~manager, a wholly- owned subsidiary of Marriott International, Inc. ~~(“Marriott International”). In connection with a refinancing of its mortgage debt in 1996~~, ~~the Partnership~~or ~~transferred ownership of the Hotels to two newly created wholly-owned subsidiaries, one of which, Courtyard II Associates, L~~MII.P. ~~became the borrower on its mortgage debt.~~

InAll ~~October~~of ~~2000,~~our inpartnership ~~connection~~units ~~with~~are ~~the~~owned ~~settlement~~by ~~of class action litigation,~~ CBM Joint Venture LLC, or (“the Courtyard JV”), a joint venture between subsidiaries of Host Marriott, L.P. and ~~Marriott International, Inc~~MII., ~~acquired direct or indirect ownership of all of the partnership interests in the Partnership.~~

Summary of Significant Accounting Policies

~~The~~We ~~accompanying~~have ~~unaudited,~~ condensed ~~consolidated~~ ~~financial~~or ~~statements~~omitted ~~have~~certain ~~been prepared by the Partnership. Certain~~ information and footnote disclosures normally included in financial statements presented in accordance with accounting principles generally accepted in the United States ~~have~~of ~~been~~America, ~~condensed~~ or ~~omitted~~GAAP, ~~from~~in the accompanying unaudited condensed consolidated financial statements. ~~The~~We ~~Partnership~~believe ~~believes~~ the disclosures made are adequate to prevent the information presented from being misleading. However, the unaudited, condensed consolidated financial statements should be read in conjunction with the ~~Partnership’s~~ consolidated financial statements and notes thereto included in ~~the~~our ~~Partnership’s~~annual report on Form 10-K for the year ended December 31, ~~2001~~2002.

In ~~the~~our opinion ~~of the Partnership~~, the accompanying unaudited, condensed consolidated financial statements reflect all adjustments necessary to present fairly ~~the~~ our financial position ~~of the Partnership~~ as of ~~September~~June 620, ~~2002,~~2003 and the results of ~~its~~our operations for the ~~twelve~~quarter ended and ~~thirty~~the year-~~six~~to-date ~~weeks~~period ended ~~September~~June 620, ~~2002~~2003 and ~~September~~June 714, ~~2001~~2002 and cash flows for the ~~thirty~~ year-~~six~~to-date ~~weeks~~period ended ~~September~~June 620, ~~2002~~2003 and ~~September~~ 7June 14, ~~2001~~2002. Interim results are not necessarily indicative of full-year performance because of the impact of seasonal and short-term variations.

Certain reclassifications were made to the prior- period financial statements to conform to the ~~2002~~current presentation.

~~For financial~~Our ~~reporting~~quarterly ~~purposes,~~results ~~the~~are ~~net~~reported ~~income~~on ofa ~~the~~quarterly schedule ~~Partnership~~that is ~~allocated~~used ~~95%~~by toMII. ~~the~~MII’s ~~limited~~year ~~partners~~ends ~~and~~on 5%the toFriday ~~CBM~~closest ~~Two~~to ~~LLC~~December ~~(the~~31 ~~“General~~and ~~Partner”).~~reflects ~~Significant~~twelve ~~differences~~weeks ~~exist~~of ~~between~~operations in the ~~net~~first ~~income~~three ~~for~~quarters ~~financial~~of ~~reporting~~the ~~purposes~~ year and ~~the~~sixteen ~~net~~or ~~income~~seventeen ~~reported~~weeks ~~for~~of ~~Federal~~operations ~~income~~for ~~tax~~the ~~purposes.~~fourth ~~These~~quarter ~~differences~~of ~~are~~the ~~due~~year. As ~~primarily~~a toresult, ~~the~~in ~~use~~any ~~for~~given ~~Federal~~quarter, ~~income~~quarter-over-quarter ~~tax~~results ~~purposes~~will ofcover ~~accelerated~~different ~~depreciation~~calendar ~~methods,~~dates ~~shorter~~(but ~~depreciable~~the ~~lives~~same ~~for~~number ~~certain~~of ~~assets~~days, ~~differences~~other than in ~~the~~a ~~timing of~~year ~~the~~with ~~recognition~~a of17-week ~~certain~~fourth ~~fees~~quarter ~~and~~such ~~straight-line~~as ~~rent~~fiscal ~~adjustments~~year 2002).

~~3. Debt~~Principles of Consolidation

~~Senior~~We ~~Notes. The~~consolidate ~~Partnership’s~~entities ~~senior~~(in ~~notes~~the ~~are~~absence ~~rated~~of byother ~~Moody’s~~factors ~~and~~determining control) ~~Standard~~when &we ~~Poors.~~own Asover a50% ~~result~~ of the ~~reduced operating~~voting ~~levels~~shares atof ~~the~~another ~~hotels~~company ~~due~~or, in ~~part~~the tocase ~~the~~of ~~weak~~partnership ~~economy~~investments, ~~the~~when ~~credit~~we ~~rating~~own ~~assigned to these senior notes was recently downgraded by Standard & Poors. Both rating agencies continue to have~~ a ~~negative~~majority ~~outlook in conjunction with credit ratings assigned to the notes. Further, under the terms~~ of the ~~senior~~general ~~notes~~partnership ~~indenture,~~interest. ~~the~~The ~~Partnership~~control ~~has~~factors anwe ~~obligation~~consider toinclude ~~maintain certain levels of excess cash flow. For~~ the ~~third~~ability ~~quarter~~ of ~~2002, these levels were not reached. As a result, the~~minority ~~Partnership~~shareholders isor ~~required~~other topartners ~~suspend distributions~~ to ~~the~~participate ~~partners~~in ~~and~~or ~~may~~block ~~not~~management ~~make other restricted payments~~decisions. Additionally, ~~the~~if ~~Partnership~~we isdetermine ~~required~~that towe ~~fund~~are aan ~~separate~~owner ~~supplemental debt-service reserve account~~ in ana ~~amount~~variable ~~equal~~interest toentity ~~consolidated excess~~within ~~cash flow for~~ the ~~quarter.~~meaning ~~Consolidated~~of ~~excess~~FASB ~~cash~~Interpretation ~~flow equaled approximately $1 million for the quarter ended September 6, 2002~~No. ~~The~~46 ~~Partnership~~and ~~is required to escrow these funds until cash flow meets specific levels . To the extent~~ that ~~the~~ ~~escrow~~our ~~exceeds~~variable ~~two semi-annual~~ interest ~~payments~~will absorb ~~(approximately~~a ~~$13.7~~majority ~~million),~~of the ~~Partnership~~entity’s isexpected ~~required~~losses toif ~~offer~~they tooccur, ~~purchase~~receive ~~the~~a ~~senior~~majority ~~notes in an amount equal to the greater~~ of the ~~amount by which the escrow exceeds two semi-annual interest payments and $5 million. The offer to purchase the senior notes must be made at par. Based on the Partnership~~entity’s ~~current~~expected ~~estimates~~residual ofreturns ~~operating~~if ~~results,~~they ~~the Partnership does not believe it will be required to make purchases under this provision in 2002. Accordingly~~occur, ~~subsequent~~or ~~to the third quarter of 2002~~both, ~~the~~then ~~Partnership~~we will ~~not~~consolidate ~~make~~the ~~any~~entity. ~~distributions~~All tomaterial ~~its~~intercompany ~~partners~~transactions orand ~~other~~balances have ~~restricted~~been ~~payments until excess cash flow has met the required level~~eliminated. ~~Based on the~~

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~—(Continued)~~

(~~Unaudited~~unaudited)

~~current~~3. ~~forecast,~~Restricted ~~the Partnership does not expect to meet the required level of excess cash flow in the fourth quarter of 2002.~~ Cash

4We are required to establish certain escrow reserves pursuant to the terms of our debt and management agreements. ~~Restricted~~ ~~Cash~~The balances in those reserves as of June 20, 2003 and December 31, 2002 are as follows (in thousands):

The Partnership was required to establish certain escrow reserves pursuant to the terms of the senior notes and the Certificates described in Note 3. The chart below summarizes the balances in those reserves as of September 6, 2002 and December 31, 2001 (in thousands):

	June 20, 2003		December 31, 2002
Debt service reserve (1)	$	1,105	$	6,848
Supplemental debt service reserve		1,423		1,416
Real estate tax and insurance reserve		7,843		7,700
Deposit reserve required by the multi-class commercial mortgage pass-through certificates		7,251		3
Working capital reserve		5,003		5,002

	$	22,625	$	20,969

	2002		2001
Debt service reserve	$	6,847	$	6,857
Real estate tax and insurance reserve		8,762		6,632
Deposit reserve		4,210		4,028
Working capital reserve		5,018		5,018
	$	24,837	$	22,535

(1)

We used approximately $5.7 million of the debt service reserve of $6.8 million at December 31, 2002 towards the semi-annual payment on our senior notes due on February 3, 2003. We are obligated to replenish these amounts in the future to the extent we have Consolidated Excess Cash Flow, as defined in the senior notes indenture.

~~On September 27, 2002 the $~~4.2 ~~million~~Amounts ~~deposit~~Paid ~~reserve, which related~~ to ~~operations of~~ the ~~Partnership’s~~ ~~properties~~General inPartner ~~the~~and ~~third~~Marriott ~~quarter~~International, ~~was released to the Partnership’s operating cash account~~Inc. Thus, these funds are available for general Partnership purposes including the funding of capital expenditures beyond those reserved for under the management agreements. As described in Note 3, subsequent to the end of the third quarter of 2002, the Partnership is required to fund a separate supplemental debt-service reserve equal to the amount of consolidated excess cash flow for the quarter.

~~5. Amounts~~The ~~Paid~~chart below summarizes amounts paid by us to ~~the~~our ~~General~~general ~~Partner~~partner and Marriott International, Inc (in thousands).

The chart below summarizes amounts paid by the Partnership to the general partner and Marriott International, Inc. for the thirty-six weeks ended September 6, 2002 and September 7, 2001 (in thousands). The table does not include ground lease payments made to affiliates of Marriott International, Inc., which are discussed in more detail below.

	Year-to-Date
	June 20, 2003		June 14, 2002
Marriott International, Inc.:
Base management fee (1)	$	3,441	$	4,176
Chain services and Marriott Rewards Program		3,273		3,738
Courtyard by Marriott system fee		2,843		2,983
Marketing fund contribution		2,438		2,488
Ground leases, net (2)		1,781		3,584

	$	13,776	$	16,969

General Partner:
Administrative expenses reimbursed	$	216	$	349

	2002		2001
Marriott International, Inc.:
Incentive management fee	$	—	$	1,603
Base management fee		6,277		7,230
Chain services and Marriott Rewards Program		5,594		6,306
Courtyard by Marriott system fee		4,483		5,165
Marketing fund contribution		3,728		4,378
	$	20,082	$	24,682
General Partner:
Administrative expenses reimbursed	$	585	$	41

(1)

We have deferred $337,000 of base management fees in 2003 to date.

~~Ground~~(2) ~~Leases. The~~We ~~land~~have ondeferred ~~which~~$1.1 53million of ~~the~~ground ~~hotels~~lease ~~are located~~payments isin ~~leased~~2003 ~~from~~to ~~affiliates~~date ofand ~~Marriott~~the ~~International.~~payments ~~The~~are ~~leases~~net ~~have~~of ~~remaining~~approximately ~~terms (including all renewal options) expiring between the years 2024 and 2068~~$1.2 ~~The~~million ~~leases~~of ~~provide~~ground ~~for~~ rent ~~based~~paid onin ~~specific~~2002 ~~percentages~~which ~~(from~~was 2%returned to ~~15%)~~us ~~of certain~~in ~~revenue categories subject to minimum amounts. The minimum rentals are adjusted at various anniversary dates throughout~~ the ~~lease~~first ~~terms.~~quarter ~~Through September 6, 2002, approximately $7.2 million~~ of ~~rental~~2003 ~~payments~~due ~~were made~~ to ~~affiliates~~a ~~of Marriott~~provision ~~International.~~available ~~The~~to ~~Partnership~~us ~~also~~under ~~rents~~our ~~certain~~ground ~~equipment for use in the hotels~~leases.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

~~NOTES~~ MANAGEMENT’S TODISCUSSION ~~CONDENSED~~AND ~~CONSOLIDATED~~ANALYSIS OF FINANCIAL ~~STATEMENTS—(Continued)~~CONDITION

~~(Unaudited)~~ AND RESULTS OF OPERATIONS

6. Management Agreement Changes

In October 2000, in connection with the acquisition of the Partnership by Courtyard JV, Host Marriott, L.P., Marriott International, Inc. and Courtyard JV agreed to certain proposed amendments to the Partnership's management agreements that would take effect at such time as all required consents of the Partnership's lenders have been obtained. Those proposed amendments primarily related to the computation of owner's priority distribution and future subordination requirements. The Partnership and the Manager also agreed to increase the annual contributions to the Partnership's FF&E Reserve from 5.0% to 6.5% of gross revenues and such increase became effective in the fourth quarter of 2000.

In August 2002 Host Marriott, L.P. and certain of its subsidiaries, Marriott International, Inc. and certain of its subsidiaries, and Courtyard JV entered into an agreement that contemplates that upon receipt of any necessary consents of the Partnership's lenders, the Partnership and the Manager will enter into agreed forms of amendments to the management agreements under which our hotels are operated. These amendments include providing the Partnership additional approval rights over hotel operating budgets and shared-service programs and easing restrictions on persons and entities to whom the Partnership may sell its hotels.

The consent of the Partnership's lenders may be required in order for the various proposed amendments to become effective. To date, the Partnership has obtained the consent of the servicer on its Mortgage Debt to the October 2000 proposed amendments and is in discussion with the servicer with respect to the August 2002 proposed amendments. The Partnership has not and does not currently contemplate seeking consents, to the extent necessary, from the holders of its senior notes for either of the amendments. Pending effectiveness of the amendments, the agreement entered into in August 2002 requires that the parties cause the Partnership and the Manager to operate as if the proposed amendments to the management agreements were in effect, to the extent that they may do so without violating any terms of the Partnership's debt agreements.

Upon receipt of required lender consents, certain provisions in the amendments will become retroactively effective as of December 29, 2001. Other changes to the management agreements become effective only in the event that the equity interests held by Marriott International in Courtyard JV fall below a specified percentage, and there is no expectation that such an event will occur in the near term.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

RESULTS OF OPERATIONS AND FINANCIAL CONDITION

Overview

The following discussion and analysis of ~~the~~ our financial condition and the results of operations should be read ~~together~~in conjunction with the condensed consolidated financial statements ~~and~~included ~~the~~elsewhere ~~notes thereto contained~~ in ~~this~~ ~~Form 10-Q. Statements contained in~~ this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” that are not historical fact may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934report. WeThis ~~have~~discussion ~~based~~includes ~~these~~ forward-looking statements onabout our ~~current~~business ~~expectations~~ and ~~projections about future events~~operations. We identify forward-looking statements in this ~~Report~~report by using words or phrases such as “believe,” “expect,” “may be,” “intend,” “predict,” “project,” “plan,” “objective,” “will be,” “should,” “estimate,” or “anticipate,” or the negative thereof or other variations thereof or comparable terminology. All forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause our actual transactions, results, performance or achievements to be materially different from any future transactions, results, performance or achievements expressed or implied by such forward-looking statements. These risks and uncertainties include those risk factors included in our 2002 annual report on Form 10-K dated March 31, 2003 and in other filings with the Securities and Exchange Commission, or the SEC. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that we will attain these expectations or that any deviations will not be material. Except as otherwise required by the federal securities laws, we disclaim any obligations or undertaking to publicly release any updates or revisions to any forward-looking statement contained in this Form 10-Q to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

Courtyard by Marriott II Limited Partnership, a Delaware limited partnership, is the owner of 70 Courtyard by Marriott hotels, which operate in the upscale segment of the lodging industry.

Our results of operations primarily represent hotel-level sales, which are room, food and beverage and other ancillary income such as telephone, parking and other guest services. Operating expenses consist of the costs to provide these services as well as depreciation, management fees, real and personal property taxes, ground rent, property insurance and other costs.

Our quarterly results are reported on a quarterly schedule that is used by MII. MII’s fiscal year ends on the Friday closest to December 31 and reflects twelve weeks of operations in the first three quarters of the year and sixteen or seventeen weeks of operations for the fourth quarter of the year. As a result, in any given quarter, quarter-over-quarter results will cover different calendar dates (but the same number of days, other than in a year with a 17-week fourth quarter such as fiscal year 2002).

We have a significant fixed-cost component associated with owning and operating these hotels, which does not necessarily decrease when circumstances such as market factors cause a reduction in property revenues. As a result, changes in RevPAR (defined below) can result in a greater percentage change in our earnings and cash flows. In response to the decline in the operations of our hotels, we have been working with our hotel manager to achieve certain cost reductions at the properties. We believe that these efforts have slowed the decline in our operating margins and that we have created meaningful long-term efficiencies. In 2003, our operating margin has continued to decrease from comparable periods in 2002 due to declining revenues. Our revenues have been negatively affected by the impact that the war in Iraq, terrorist threats and the weak economy have had on travel.

Operating Statistics

Our reported hotel operating statistics (i.e., RevPAR, average daily rate and average occupancy) for the quarters ended June 20, 2003 and June 14, 2002 reflect results for the twelve-week periods from March 29, 2003 to June 20, 2003 and March 23, 2002 to June 14, 2002, respectively.

Our reported hotel operating statistics for year-to-date June 20, 2003 and year-to-date June 14, 2002 reflect results for the twenty-four-week periods (or 168 days) from January 4, 2003 to June 20, 2003 and December 29, 2001 to June 14, 2002, respectively.

Recent Events

~~Senior~~To ~~Notes. Our~~maintain ~~senior notes are rated by Moody’s and Standard & Poors. As a result of~~ the ~~reduced~~overall ~~operating~~quality levels at the hotels due, in part, to the weak economy, the credit rating assigned to these senior notes was recently downgraded by Standard & Poors. Both rating agencies continue to have a negative outlook in conjunction with credit ratings assigned to the notes. Further, under the terms of ~~the~~our ~~senior~~lodging ~~notes indenture~~properties, we ~~have~~annually anassess ~~obligation to maintain certain levels of excess cash flow. For~~ the ~~third~~need ~~quarter~~for ofrefurbishments ~~2002,~~and ~~the~~capital ~~levels were not reached~~improvements. ~~As a result~~Typically, werefurbishments ~~are~~occur ~~required to suspend~~at ~~distributions~~intervals toof ~~our~~approximately ~~partners~~seven ~~and may not make other restricted payments. Additionally~~years, webased ~~are~~on ~~required to fund a separate supplemental debt-service reserve account in~~ an ~~amount~~annual ~~equal~~review toof the ~~amount~~condition of ~~consolidated~~each ~~excess cash flow for the quarter~~property. ~~Consolidated~~ ~~excess~~Our ~~cash~~management ~~flow~~agreements ~~equaled~~require ~~approximately~~us ~~$1 million for the quarter ended September 6, 2002. We are required~~ to escrow ~~these funds until cash flow meets specific levels~~6.5% ~~To the extent that the escrow exceeds two semi-annual interest payments (approximately $13.7 million), we are required to offer to purchase the senior notes in an amount equal to the greater~~ of ~~the~~hotel ~~amount~~sales ~~by which the escrow exceeds two semi-annual interest payments~~ and, ~~$5 million. Based~~ on ~~our current estimates of operating results~~average, we docontribute ~~not~~approximately ~~believe~~$17 wemillion ~~will~~annually ~~be required~~ to ~~make purchases under~~ this ~~provision~~reserve for inthese ~~2002.~~refurbishments ~~The~~and ~~offer~~capital ~~to purchase the senior notes must be made at par~~improvements. ~~Accordingly~~However, ~~subsequent~~for ~~to the third quarter of 2002~~2003, we will not make any distributions to our partners or other restricted payments until excess cash flow has met the required level. Based on our current forecast, we do not expect to meet the required level of cash flow in the fourth quarter of 2002.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS ~~AND FINANCIAL CONDITION—(Continued)~~

~~The~~only ~~table~~expect to ~~below~~contribute ~~summarizes~~approximately ~~our~~$15.7 ~~obligations~~million ~~for~~due ~~principal~~to ~~payments~~reduced operating levels. Our capital expenditures have been focused on ~~our~~property ~~debt~~maintenance and ~~land leases~~improvements ~~(in~~designed ~~thousands)~~to maintain appropriate levels of quality.

	Senior Notes		Mortgage Debt		Land Leases
2002(1)	$	—	$	6,603	$	3,094
2003		—		20,827		10,348
2004		—		22,443		10,381
2005		—		24,186		10,889
2006		—		26,064		11,207
Thereafter		127,400		208,359		1,839,949
Total	$	127,400	$	308,482	$	1,885,868

During 2002, we began an effort to reposition our properties to compete with newer properties in certain of our markets. We have undertaken these repositionings in response to changing consumer tastes and trends in the industry. By the end of 2002, we completed the repositioning of three properties at a cost of approximately $6.8 million (or approximately $15,500 per room). While we are evaluating the effect on operations of the refurbishments completed on the three properties, we have modified the scope of the project to see if we can gain the same benefits at a lower cost per room and thus reposition additional properties. The revised scope includes:

~~(1)~~• ~~Amounts~~guest ~~shown~~room ~~for~~renovations ~~principal~~that ~~payments~~include ~~due~~the onreplacement ~~our~~of ~~mortgage~~select ~~debt~~pieces ~~and~~of ~~land~~furniture ~~leases~~along ~~for~~with ~~2002~~the ~~are~~complete ~~for~~replacement ~~the~~of ~~fourth~~draperies, ~~quarter~~carpets, oflighting ~~2002~~and ~~only.~~bed coverings with a more contemporary décor;

~~Ground~~• ~~Leases. The~~a ~~land~~reconfiguration ~~on which 53~~ of the ~~hotels~~lobby ~~are~~dining ~~located~~room is leased from affiliates of Marriott International. Additionally, eight hotels are located on land leased from third parties. The land leases have remaining terms (including all renewal options) expiring between the years 2024 and ~~2068.~~adjoining ~~The~~lounge ~~land~~area ~~leases provide for rent based on specific percentages (from 2%~~ to ~~15%)~~make ~~of certain revenue categories subject to minimum amounts. The minimum rentals are adjusted at various anniversary dates throughout~~ the ~~lease~~space ~~terms.~~more ~~The~~flexible ~~total~~with ~~rental~~updated ~~payments~~furniture asand ofother ~~September~~décor ~~6, 2002 of $8.6 million include $7.2 million that were paid~~ to ~~affiliates~~provide ofa ~~Marriott~~more ~~International.~~inviting ~~We also rent certain equipment for use in the hotels.~~ feel;

~~Management Agreement~~• ~~Changes. In October 2000, in connection with~~ the ~~acquisition~~renovation of ~~the~~guest ~~Partnership~~room bycorridors ~~Courtyard~~with ~~JV,~~new ~~Host Marriott~~carpet, ~~L.P.,~~wall ~~Marriott~~vinyl ~~International, Inc.~~ and ~~Courtyard~~brighter JVlighting agreed to certain proposed amendments to the Partnership's management agreements that would take effect at such time as all required consents of the Partnership's lenders have been obtained. Those proposed amendments primarily related to the computation of owner's priority distribution and future subordination requirements. The Partnership and the Manager also agreed to increase the annual contributions to the Partnership's FF&E Reserve from 5.0% to 6.5% of gross revenues and such increase became effective in the fourth quarter of 2000. systems;

In• ~~August~~refurbishment ~~2002 Host Marriott, L.P. and certain~~ of ~~its subsidiaries, Marriott International, Inc. and certain of its subsidiaries, and Courtyard JV entered into an agreement that contemplates that upon receipt of any necessary consents of~~ the ~~Partnership's~~exercise ~~lenders,~~room; ~~the Partnership~~ and the Manager will enter into agreed forms of amendments to the management agreements under which our hotels are operated. These amendments include providing the Partnership additional approval rights over hotel operating budgets and shared-service programs and easing restrictions on persons and entities to whom the Partnership may sell its hotels.

~~The~~• ~~consent~~adding ofa ~~the~~pantry ~~Partnership's~~that ~~lenders~~will ~~may~~offer be24-hour ~~required~~access ~~in order for the various proposed amendments~~ to ~~become~~a ~~effective. To~~variety ~~date, the Partnership has obtained the consent~~ of ~~the~~food ~~servicer on its Mortgage Debt to the October 2000 proposed amendments~~ and isbeverage ~~in discussion with the servicer with respect to the August 2002 proposed amendments~~items. The Partnership has not and does not currently contemplate seeking consents, to the extent necessary, from the holders of its senior notes for either of the amendments. Pending effectiveness of the amendments, the agreement entered into in August 2002 requires that the parties cause the Partnership and the Manager to operate as if the proposed amendments to the management agreements were in effect, to the extent that they may do so without violating any terms of the Partnership's debt agreements.

~~Upon~~Work ~~receipt~~on ofthe ~~required~~revised ~~lender~~refurbishment ~~consents,~~plans ~~certain~~is ~~provisions~~scheduled to begin in ~~the~~August ~~amendments~~of 2003. We will ~~become~~continue ~~retroactively~~to ~~effective~~monitor asthe effect of ~~December~~the ~~29,~~scope ~~2001~~of renovations and make modifications as necessary. ~~Other~~We ~~changes~~have approximately $41 million in our property improvement fund, of which $34 million is budgeted to upgrade 18 additional hotels in 2003 and 2004. While a portion of the portfolio can be ~~management~~repositioned ~~agreements~~with ~~become~~the ~~effective~~amounts ~~only~~expected to be in the ~~event~~property ~~that~~improvement fund, the ~~equity~~total ~~interests~~capital ~~held~~expenditure budget proposed by ~~Marriott~~the ~~International~~manager inexceeds ~~Courtyard~~the JVamount ~~fall~~expected ~~below~~to abe ~~specified~~in ~~percentage~~the property improvement fund. Generally, ~~and~~the ~~there~~partners isare nonot ~~expectation~~obligated to fund improvements to the extent that ~~such~~they anexceed ~~event~~the ~~will~~amounts ~~occur~~reserved for in the ~~near~~property ~~term~~improvement fund under the management agreement. Therefore, the pace at which we reposition additional properties in future years will depend upon the results of our operations and the ultimate benefits that we receive from these improvements.

Lodging Performance

The current operating environment for our hotels remains challenging. ~~The~~as ~~continued~~demand ~~effects~~continues ofto ~~the~~be ~~economic~~soft ~~slowdown~~ and ~~the~~booking ~~erosion~~cycles ofshort. ~~corporate~~We ~~profits~~use ~~have reduced business travel and, as~~ a ~~result,~~measure ~~lodging~~common ~~demand.~~in ~~Our~~the industry ~~uses~~ ~~two common measures~~ to evaluate the ~~operations~~level of business of a hotel— known as room revenue per available room, or “ RevPAR~~,” and hotel operating margins~~. RevPAR is defined as the product of the average daily room rate charged and the average daily occupancy achieved. RevPAR does not include food and beverage or other ancillary revenues such as ~~parking,~~ telephone or other guest services generated by the property. ~~Hotel operating margin is calculated using property-level revenues and expenses and does not include certain costs such as interest expense, lease payments or depreciation.~~

~~For~~The operating environment during the ~~third~~second ~~quarter~~quarters of ~~2002,~~2003 ~~RevPAR for~~and ~~our~~2002 ~~hotels~~were ~~decreased~~difficult ~~approximately~~due ~~8.5%~~to ~~when~~reduced ~~compared~~airline totravel, ~~the~~weak ~~same~~economic ~~period~~conditions inand ~~2001.~~the ~~The~~general ~~decline~~unrest isas ~~the~~a result of athe ~~decrease~~increased interror-alert ~~average~~levels. ~~occupancy~~During ofthe ~~1.3~~second ~~percentage~~quarter ~~points~~of ~~and~~2003, the ~~decline~~operating ofenvironment ~~average~~was ~~room~~further ~~rates~~strained ofby ~~6.9%.~~the ~~Also,~~war ~~year-to-date RevPAR~~in ~~decreased 12~~Iraq.~~7%,~~ asThese ~~occupancy~~factors ~~decreased~~have ~~4.5~~reduced ~~percentage~~overall ~~points~~lodging ~~and~~demand, ~~room~~causing ~~rates~~a ~~declined~~decline byin ~~7.1%.~~RevPAR ~~The~~and ~~changes~~operating inprofits ~~RevPAR~~for ~~reflect~~our aportfolio. ~~decline~~Although inthe ~~operations~~war in ~~every~~Iraq ~~region~~has ~~for~~abated ~~the~~we ~~quarter~~expect ~~and~~operating ~~year-~~conditions to~~-date;~~ ~~however,~~remain ~~the~~challenging ~~decreases~~throughout in2003. ~~RevPAR~~For ~~varied across~~ the second ~~country.~~quarter ~~Compared~~of ~~to 2001~~2003, RevPAR for our ~~nine~~hotels ~~Mid-Atlantic~~decreased ~~region~~7.1% ~~properties~~when ~~have~~compared ~~experienced~~to athe ~~12.4%~~same ~~decline~~period in ~~year-to-date~~2002. ~~RevPAR~~The ~~largely~~decline asis athe result of a ~~decline~~decrease in average occupancy of ~~nearly~~3.1 ~~six~~ percentage points ~~coupled~~and ~~with~~the a decline in average room rates of ~~just under 5%. For the quarter these properties had a RevPAR decline of 10.~~3.0%. ~~Compared to 2001~~Also, ~~our 13 Western region properties have experienced RevPAR declines of 15.5% on a~~ year-to-date ~~basis, though the change was primarily room rate driven with a~~ ~~decline~~RevPAR ofdecreased 124.75%, ~~combined~~as ~~with a decline in~~ occupancy ofdecreased 21.34 percentage points. Weand ~~anticipate that there will be continued pressure on~~ room rates ~~and~~declined by ~~occupancy levels until economic growth increases lodging demand, particularly among individual business travelers~~2.5%.

The changes in RevPAR reflect a decline in operations in every region for the quarter and year-to-date. For the year, the South Central region has suffered the most significant decline in RevPAR, down 10.4% from the prior year. For the quarter ended June 20, 2003, the Mid-Atlantic and Western regions had RevPAR declines of 9.4% and 8.5%, respectively, when compared to the quarter ended June 14, 2002. Operating results in the Western region continue to deteriorate due in part to the prolonged slump

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS ~~AND FINANCIAL CONDITION—(Continued)~~

~~Hotel operating margins declined 2.3 percentage points for the third quarter when compared to the same period~~ in ~~2001 and have~~the ~~declined~~technology 1sector.7 ~~percentage~~The ~~points~~South ~~year-to-date.~~Central Weregion ~~began~~continues ~~working with our Manager early in 2001~~ to ~~control~~be ~~operating~~impacted ~~costs~~by ~~through~~the ~~eliminating~~difficult ~~management~~economic ~~positions~~conditions ~~and~~in ~~implementing other cost control measures~~Dallas. Our ~~efforts~~most ~~thus~~stable ~~far~~regions inwere ~~2002 to protect~~ the ~~long-term~~Midwest ~~efficiencies~~and ~~gained~~Southeast, bywhere ~~these~~the ~~measures have kept our~~ year-~~over~~to-~~year~~date ~~decrease~~declines in ~~hotel~~RevPAR ~~operating~~were ~~margins to 1~~2.71% ~~percentage~~and ~~points, despite a decrease in RevPAR of 12~~.78%~~. Additionally~~, ~~the decrease in our hotel operating margins has been~~respectively. ~~partially~~These ~~offset~~markets byrely ~~reduced~~heavily ~~management~~on ~~fees.~~drive-in ~~For~~transient ~~full year 2002~~business, weand ~~expect~~therefore ~~the~~demand ~~decline~~at inthese ~~RevPAR~~hotels towas benot ~~between~~significantly 7%affected toby 9%the ~~with an overall~~ decline in ~~property-level~~airline ~~operating~~travel ~~margins~~during ~~also~~this ~~likely compared to 2001~~period. ~~Our~~We ~~ability~~anticipate tothat ~~predict~~there ~~future~~will ~~operating results~~be ~~remains~~continued ~~limited~~pressure ~~due~~on toroom ~~slower-than-anticipated~~rates ~~growth in the economy~~ and occupancy ~~lingering~~levels ~~concerns~~until ~~over~~economic ~~terrorism~~growth ~~and~~increases ~~the~~lodging ~~potential~~demand, ~~for~~particularly ~~additional~~among ~~military~~individual ~~action~~business ~~abroad~~travelers.

The following ~~tables~~table ~~set~~sets forth performance information for all our properties by geographic region as of ~~September~~June 620, ~~2002~~2003 and ~~September~~June 714, ~~2001~~2002:

All Properties by Region

			Twelve Weeks Ended
			Quarter Ended
	As of September 6, 2002		September 6, 2002						September 7, 2001
	As of June 20, 2003		June 20, 2003						June 14, 2002
	No. of Properties	No. of Rooms	Average Daily Rate		Average Occupancy Percentages		RevPAR		Average Daily Rate		Average Occupancy Percentages		RevPAR		Percent Change in RevPAR
Northeast	6	880	$	~~111~~113.1797	80.7	%	$	8991.7494	$	118.9334	8082.25	%	$	9597.4362	(65.08	)%
MidAtlantic	9	1,336		87.45	70.6			61.78		93.69	73.5			68.87	(10.3	)
Mid-Atlantic	9	1,336		88.17	73.6			64.93		94.82	75.5			71.64	(9.4	)
Midwest	19	2,~~793~~645		86.1070	7873.92			6763.9146		9385.5830	7876.25			7365.2127	(7.2.8	)
SouthCentral	9	1,337		81.74	71.1			58.11		85.53	75.9			64.89	(10.5	)
South Central	9	1,490		78.10	69.5			54.24		82.25	69.9			57.46	(5.6	)
Southeast	14	2,062		8079.7843	6768.10			54.2102		8482.1989	7068.80			5956.6335	(94.1	)
Western	13	1,~~923~~924		8684.9579	7067.78			6157.46		9788.4086	6970.57			6762.7282	(98.25	)
All Regions	70	10,~~331~~337		8788.2607	7369.19			6361.7754		9390.7478	7473.40			6966.7325	(87.51	)

All Properties by Region

			Thirty-six Weeks Ended
			Year-to-date
	As of September 6, 2002		September 6, 2002						September 7, 2001
	As of June 20, 2003		June 20, 2003						June 14, 2002
	No. of Properties	No. of Rooms	Average Daily Rate		Average Occupancy Percentages		RevPAR		Average Daily Rate		Average Occupancy Percentages		RevPAR		Percent Change in RevPAR
Northeast	6	880	$	~~110~~109.5660	7569.18	%	$	8376.0247	$	~~119~~110.0122	7872.83	%	$	~~93.~~79.66	(114.50	)%
MidAtlantic	9	1,336		90.30	67.5			60.91		94.94	73.3			69.56	(12.4	)
Mid-Atlantic	9	1,336		86.49	66.6			57.63		91.84	65.8			60.48	(4.7	)
Midwest	19	2,~~793~~645		85.4944	7267.2			6157.7545		9285.6615	7568.29			6958.7168	(112.41	)
SouthCentral	9	1,337		83.81	68.7			57.62		86.81	75.7			65.74	(12.4	)
South Central	9	1,490		80.46	63.9			51.40		84.90	67.6			57.38	(10.4	)
Southeast	14	2,062		8789.8645	6870.96			6063.5013		91.8227	7569.28			6963.0865	(120.48	)
Western	13	1,~~923~~924		92.8008	7067.7			6562.5937		~~106~~95.3372	7370.06			7767.6166	(157.58	)
All Regions	70	10,~~331~~337		89.9815	7067.47			6360.3835		9691.8541	7469.91			7263.5719	(124.75	)

~~Results~~RESULTS ofOF ~~Operations~~ OPERATIONS

Hotel Revenues. ~~Total~~ ~~hotel~~Hotel revenues for the ~~twelve~~second ~~weeks~~quarter ~~ended~~of ~~September 6, 2002~~ 2003 decreased by $64.34 million, or 97.1%, to $6058.0 million compared to the same period in ~~2001~~2002. ~~For~~ ~~the thirty~~Year-~~six~~to-date ~~weeks ended September 6~~2003, ~~2002, total~~ hotel revenues decreased by $275.36 million, or 134.7%, to $~~179~~113.37 million, ~~compared~~from to the ~~thirty-six~~same ~~weeks~~period ~~ended~~in ~~September 7, 2001~~2002. ~~The~~This decrease in hotel revenues for ~~both~~ the second ~~third~~ quarter ~~of 2002~~ and year-to-date ~~2002~~2003 is primarily due to a decrease in room revenues. The ~~decrease~~results inreflect ~~year-to-date~~the ~~room~~continued ~~revenues~~weakness ~~was~~for ~~driven~~our bysegment aof ~~decline~~the inlodging ~~occupancy~~industry ofprimarily ~~4.5~~due ~~percentage~~to ~~points~~reduced ~~and~~business atravel. ~~decline~~Additionally, inincreased ~~average~~competition resulting from lower room rates at many of ~~$6.88,~~the orfull-service ~~7.1%.~~hotels ~~The~~that ~~results~~operate ~~reflect the~~in ~~continued~~our ~~demand~~markets ~~weakness~~have incaused ~~the~~room-rate ~~lodging~~reductions ~~industry.~~at ~~Additionally,~~many ~~increased~~of ~~competition~~our ~~resulting~~hotels.

Operating Costs and Expenses. Operating costs and expenses decreased by $1.6 million, or 3.1% quarter over quarter. For year-to-date, the operating costs and expenses decreased by $1.0 million, or 1.1% when compared to the same period in 2002. Our costs decreased primarily as a result of a decrease in rooms’ expenses related to lower occupancies, as well as a decrease in management fees related to decreased hotel revenues and operating profit. These decreases in rooms’ expenses do not fully offset the declines in occupancy at our hotels, and, as a result, operating margins declined as detailed below.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

Operating Profit. Operating profit for the second quarter of 2003 declined by $2.9 million compared to the second quarter 2002. For year-to-date 2003, operating profit decreased $4.6 million compared to the same period in 2002. Operating profit represented 16% of total revenues for the second quarter of 2003 and 20% for the second quarter of 2002. Year-to-date operating profit represented 15% and 18%, respectively, of total revenues for 2003 and 2002.

Net Income (Loss). Net income for the second quarter of 2003 decreased by $2.5 million to $617,000 when compared to the same period in 2002. For year-to-date 2003, operations resulted in a net loss of $1.0 million, compared to net income of $3.5 million for the same period in 2002. The decrease is a result of the factors discussed above.

LIQUIDITY AND CAPITAL RESOURCES

As of June 20, 2003, we have $8.5 million of unrestricted cash. Our principal source of cash is cash from operations including cash available to us by virtue of the subordination and deferral features in certain of our ground leases and our management agreements. Our principal uses of cash are to make debt service payments, fund our required reserves, repay certain deferred expenses and fund capital expenditures for property improvements. Our annual debt service includes interest payments on our senior notes of approximately $13.7 million and principal and interest payments on our multi-class commercial mortgage pass-through certificates (CMBS) of approximately $43.9 million. We believe our sources of cash are sufficient to meet our near-term liquidity needs, however, our ability to meet our long-term liquidity needs will depend on our future results of operations.

The weak economy and the resultant decline in demand have reduced the cash flow levels at our properties significantly from prior-year levels. As a result, beginning in the fourth quarter of 2002, we have made use of certain reserves and deferred a portion of our management fees and ground rent to make our required debt service payments. Under the terms of the management agreements and the ground leases with Marriott International, Inc. and its affiliates, a portion of the base management fees and all of the ground rent and incentive management fees due Marriott International, Inc. and its affiliates are subordinate to debt service payments on our senior notes and CMBS debt. We deferred $.1 million of ground lease payments and $.2 million of base management fees in 2002. During the first quarter of 2003, we drew $5.7 million from the debt service reserve. Additionally, we deferred $2.3 million of ground lease payments and $.3 million of base management fees thus far in 2003. The $2.4 million of deferred ground lease payments due to Marriott International and its affiliates have been included in “Due to Marriott International, Inc. and its affiliates”, and $.5 million of deferred base management fees have been included in “Management fees due to Courtyard Management Corporation”. Included in the $2.4 million of deferred ground rent described above is approximately $1.2 million of ground rent paid in 2002 but returned under the terms of the lease by our ground lessor during the first quarter of 2003. Based on our current forecasts for the full-year 2003, it is likely that we will have insufficient cash flow from operations to fund our debt service requirements without the subordination of management fees and ground lease payments discussed above. Depending upon the degree of the shortfall, if any, we may draw additional debt service reserves and/or defer additional amounts of ground rent and management fees.

We are required to replenish the debt service reserve and achieve certain levels of excess cash flow before we can repay deferred ground rent and management fee amounts and make equity distributions to our partners. Based on our outlook for 2003, we do not expect to replenish the debt service reserve by year end. Thus, we currently do not expect to make any distributions to our partners until 2004 at the earliest.

We also are subject to certain restrictions on the use of our cash under our senior notes indenture. Under the terms of the senior notes indenture, our ability to make certain distributions and payments is dependent on our maintaining certain levels of cash flow. These levels have not been reached since the third quarter of 2002. Additionally, to the extent the debt service reserve is fully funded, we are required to fund a separate supplemental debt service reserve account in an amount equal to Consolidated Excess Cash Flow, as defined in the senior notes indenture, for each quarter until excess cash flow meets specific levels. Through June 20, 2003, we have reserved $1.4 million of Consolidated Excess Cash Flow, all of which was funded during 2002. To the extent that the supplemental debt service reserve exceeds two semi-annual interest payments (approximately $13.7 million), we are required to offer to purchase the senior notes at par in an amount equal to the greater of (i) the amount by which the supplemental debt service reserve exceeds two semi-annual interest payments, and (ii) $5 million.

Cash Provided by Operations. Year-to-date 2003, our cash provided by operations decreased by $4.0 million when compared to the same period in 2002. The decrease is due primarily to the declining operating results at our hotels, partially offset by the deferral of the payment of certain management fees and ground rent.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS ~~AND FINANCIAL CONDITION—(Continued)~~

Cash Used in Investing Activities. Investing activities consist primarily of contributions to and distributions from ~~lower~~the ~~room~~property ~~rates~~improvement atfund. ~~many~~In accordance with our management agreements, contributions to the property improvement fund are 6.5% of total hotel revenues. As of June 20, 2003, the ~~full~~balance in the property improvement fund was $40.8 million. For the year-~~service~~to-date ~~hotels~~periods ~~which~~ended ~~operate~~June in20, 2003 and June 14, 2002 contributions to the ~~markets~~property ~~where~~improvement ~~our~~fund ~~hotels~~were ~~are~~$7.4 ~~located~~million ~~have~~and ~~necessitated~~$7.8 ~~room~~million, respectively. Distributions from the property improvement fund reflect capital expenditures for the replacement of furniture, fixtures and equipment offset by interest income earned by the fund. Capital expenditures were $6.4 million and $2.2 million, respectively, for the year-~~rate~~to-date ~~reductions~~periods ended June 20, 2003 and June 14, 2002. The increase in capital expenditures for 2003 is due to refurbishments currently being implemented at ~~many~~certain of our ~~hotels~~properties to reposition them to compete with newer properties.

~~Property~~Cash ~~level~~Used ~~costs~~in ~~and~~Financing ~~expenses~~Activities. ~~Property-level costs and~~ ~~expenses~~Financing ~~which~~activities ~~includes~~primarily ~~rooms,~~include ~~food~~the ~~and~~repayment ~~beverage,~~of ~~department~~principal ~~costs~~on ~~and~~our ~~expenses~~CMBS debt and ~~selling,~~distributions ~~administration~~to general and ~~other~~limited ~~property-level~~partners. ~~expenses~~We ~~declined~~repaid $1.8.5 million, orand ~~5%, to~~ $317.39 million, ~~for~~respectively, ~~the third quarter~~ of ~~2002~~principal ~~compared~~on to the ~~third~~CMBS ~~quarter of~~debt ~~2001.~~during ~~For~~ the ~~thirty~~year-~~six~~to-date periods ~~weeks~~ ended ~~September~~June 620, ~~2002,~~2003 ~~property-level costs~~ and ~~expenses~~June ~~decreased~~14, ~~$10~~2002.6 ~~million,~~Due orto ~~10%,~~our failure to ~~$92.0~~reach ~~million~~certain ~~from~~cash ~~the~~flow ~~same~~thresholds ~~period~~required inby ~~2001.~~the ~~The~~senior ~~decrease~~notes isindenture, ~~largely~~no ~~due~~distributions to athe ~~decline~~partners inhave ~~controllable~~been ~~expenses~~made asand ~~a result~~will ofnot ~~cost-cutting~~be ~~efforts~~made ~~implemented~~until atwe ~~the~~again ~~hotels~~satisfy ~~in response to~~ the ~~decrease~~cash inflow covenants, ~~occupancy.~~fully ~~These~~replenish ~~efforts include a decrease in wages at~~ the ~~properties of~~ $36.78 million. ~~However,~~debt-service ~~our~~reserve ~~ability~~and topay ~~achieve~~ground ~~additional~~lease ~~reductions~~payments deferred in ~~costs~~prior ~~is limited~~years. AsAlso, aas ~~percentage~~previously ~~of hotel revenues~~noted, ~~property-level~~we ~~costs~~used ~~and expenses represented~~ approximately ~~52%~~$5.7 ~~and~~million ~~50%~~ of ~~hotel~~our ~~revenues~~senior ~~for~~note ~~the~~debt ~~third~~service ~~quarter~~reserve ~~of 2002 and 2001, respectively. Year-~~to~~-date,~~ ~~property-level~~make ~~costs~~our ~~and expenses represented~~semi-annual ~~51%~~interest ~~and~~payment ~~50%~~on ofthese ~~hotel~~senior ~~revenues~~notes ~~for~~in ~~2002~~February ~~and 2001, respectively~~2003.

~~Base~~Debt. ~~and~~We ~~Courtyard management fees. Base~~have ~~and~~$293.4 ~~Courtyard~~million ~~management~~of ~~fees~~CMBS ~~declined~~debt ~~$375,000,~~secured orby ~~9%,~~our ~~for~~properties ~~the~~as ~~third~~of ~~quarter~~June of20, ~~2002~~2003, ~~versus~~and ~~the~~we ~~third~~have ~~quarter~~$127.4 million of ~~2001,~~senior ~~and~~notes ~~declined~~secured ~~$1.6~~by ~~million,~~equity orinterests ~~13%,~~in ~~year-to-date~~the ~~versus~~partnership ~~2001~~that owns the hotels. The ~~decrease~~CMBS debt, which matures in ~~management~~January ~~fees~~2008, ~~which~~bears ~~are~~interest at ~~calculated~~a asweighted average interest rate of 7.85% and has a ~~percentage~~ weighted average term of ~~total~~17 ~~hotel~~years. ~~revenues,~~Principal ispayments ~~consistent~~for ~~with~~2003 ~~the~~will ~~decline~~total inapproximately ~~hotel~~$20.8 ~~revenues~~million.

~~Incentive~~Our ~~Management Fees. Incentive~~senior ~~management~~notes ~~fees~~are ~~declined~~currently rated by ~~$576,000,~~Moody’s orand ~~20%,~~Standard ~~for~~& ~~the~~Poor’s. ~~third~~As ~~quarter~~a result of ~~2002~~the ~~versus~~significantly reduced operating levels the ~~third~~credit ~~quarter~~rating ofassigned to ~~2001,~~these ~~and~~senior ~~declined~~notes ~~$1.9~~was ~~million,~~downgraded orfrom ~~21%,~~B1 ~~year-~~to~~-date~~ B2 by Moody’s and from ~~2001.~~B- ~~This~~to isCCC+ aby ~~result~~Standard of& ~~decreased~~Poor’s ~~hotel profitability~~in March 2003. ~~Year-to-date~~Additionally, noStandard ~~incentive~~& ~~management~~Poor’s ~~fees~~has ~~have~~placed ~~been~~these ~~paid~~senior tonotes ~~the~~on ~~manager.~~a ~~The~~negative $7credit watch.1 ~~million~~If ~~incentive~~operations ~~management~~were to ~~fee~~decline ~~earned~~further, ~~during~~or ~~the~~if ~~thirty-six~~our ~~week~~credit ~~period~~ratios ~~ended~~do ~~September~~not 6otherwise improve, ~~2002~~the ~~has~~ratings ~~been~~on ~~accrued~~our ~~and~~senior isnotes ~~included~~could inbe ~~Management~~reduced ~~fees due~~further. toIf ~~Courtyard~~we ~~Management~~were ~~Corporation~~unable onto ~~the~~subsequently ~~balance~~improve ~~sheet.~~our Incredit ~~accordance~~ratings, ~~with~~our ~~the~~cost ~~management~~to ~~agreements,~~refinance ~~deferred~~this ~~incentive~~debt ~~management~~as ~~fees~~it ~~are~~comes ~~paid~~due ~~only~~would likely toincrease. ~~the~~The ~~extent~~senior ~~that~~notes, ~~cash~~which ~~flows~~mature ~~exceed~~in ~~debt~~February ~~service~~2008, are interest only and bear a ~~priority~~rate ~~return~~of ~~to equity~~10. 75%.

~~Operating~~ITEM ~~Profit. Operating profit for third quarter 2002 declined by $~~3.3 ~~million~~QUANTITATIVE ~~compared~~AND toQUALITATIVE ~~third quarter~~DISCLOSURES ~~2001.~~ABOUT ~~Year-to-date,~~MARKET operating profit decreased $11.4 million to $32.0 million when compared to the same period in 2001. Operating profit represented 17% of total revenues for the third quarter of 2002 and 21% for the third quarter of 2001. Year-to-date, operating profit represented 18% and 21% of hotel revenues for 2002 and 2001, respectively. RISK

~~Interest Expense. Interest~~We ~~expense~~do ~~decreased~~not ~~$411,000,~~have orsignificant ~~4.3%,~~market ~~for~~risk ~~the~~with ~~third~~respect ~~quarter~~to ofinterest ~~2002~~rates, ~~versus~~foreign ~~the~~currency ~~third~~exchanges ~~quarter~~or ofother ~~2001,~~market ~~and~~rate ~~decreased~~or ~~$1.1~~price ~~million~~risks, orand ~~3.8%,~~we ~~year-to-date.~~do ~~The~~not ~~decreases~~hold ~~for~~any ~~both~~financial ~~periods~~instruments ~~are~~for ~~the~~trading ~~result~~purposes. As of June 20, ~~lower~~2003, ~~levels~~all of ~~indebtedness~~our indebt ~~comparison~~is tofixed ~~the prior year~~rate.

~~Net~~ITEM ~~Income~~4. ~~Net~~ ~~income~~CONTROLS ~~for~~AND the third quarter 2002 decreased by $3.1 million to $1.5 million when compared to the same period in 2001. Year-to-date, net income decreased $11.0 million to $5.0 million, as a result of the items discussed above. PROCEDURES

~~Liquidity~~We maintain disclosure controls and ~~Capital~~procedures ~~Resources~~that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

~~Our principal~~As ~~source~~ of ~~cash~~June is20, ~~cash~~2003, ~~from our operations. As a result of~~ the ~~state~~end of the ~~economy~~quarter ~~and~~covered ~~the~~by ~~resulting~~this ~~profitability decline in lodging operations~~report, ~~the~~we ~~operating~~carried ~~results~~out atan ~~our properties have decreased significantly over prior-year levels. Based on the current forecast of full-year results~~evaluation, itunder ~~appears that there will be sufficient cash from operations to make~~ the ~~required~~supervision ~~debt~~and ~~service~~with ~~payments. In addition, under~~ the ~~terms~~participation of ~~the~~our management ~~agreements and the ground leases with~~, ~~Marriott~~including ~~International,~~our wePrincipal ~~can,~~Executive toOfficer ~~the~~and ~~extent necessary to meet~~ our ~~debt~~Principal ~~service~~Financial ~~requirements~~Officer, ~~defer~~of athe ~~portion~~effectiveness of the ~~base~~design ~~management fee~~ and ~~all~~operation of ~~the~~our ~~ground~~disclosure ~~rent~~controls and ~~incentive management fees due Marriott International~~procedures. Based on ~~our current expectations, we believe that we will be able to make~~ the ~~required debt service payments without the use of these subordination provisions. However~~foregoing, ifour ~~operations~~Principal ~~decline~~Executive ~~further,~~Officer weand ~~can~~Principal Financial ~~make~~Officer noconcluded ~~assurances~~that asour todisclosure ~~the~~controls ~~timing~~and orprocedures ~~amount~~were ofeffective ~~any subordination~~at ~~that may be required under~~ the ~~terms~~reasonable ofassurance ~~our debt agreements~~level.

As of September 6, 2002, we have $2.8 million of operating cash. Additionally, included in restricted cash as of this date, we had $4.2 million in deposit reserves held by the servicer that relates to the operations of our properties in the third quarter. These funds were released to the operating cash account on September 27, 2002 and became available for general partnership purposes

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP AND SUBSIDIARIES

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS ~~AND FINANCIAL CONDITION—(Continued)~~

~~including~~There ~~the~~has been ~~funding~~no ofchange ~~capital~~in ~~expenditures.~~our ~~Due~~internal tocontrols ~~our~~over ~~failure~~financial toreporting ~~reach~~during ~~certain~~our ~~cash~~most ~~flow~~recent ~~thresholds~~fiscal ~~required~~quarter bythat ~~the~~has ~~senior notes’~~materially ~~indenture~~affected, weor ~~are~~is ~~required~~reasonably tolikely ~~escrow available consolidated excess cash flow and we are prohibited from making distributions~~ to ~~the~~materially ~~partners~~affect ~~for~~our atinternal ~~least~~control ~~the~~over ~~remainder~~financial ~~of 2002~~reports.

InPART ~~order to maintain and upgrade our hotels, we have placed in a FF&E escrow account 6~~II.5% ofOTHER ~~revenue~~INFORMATION orAND ~~approximately~~SIGNATURES $11.7 million this year. Our total FF&E reserves as of September 6, 2002 are $39.1 million, which includes the impact of expenditures funded from the FF&E escrow account of approximately $3.3 million this year. The manager has proposed capital improvements that include design, structural and technological improvements to modernize and enhance the functionality and appeal of the hotels. The total capital expenditure budget exceeds the amount expected to be in the FF&E reserve. Depending on the level of expenditures which the partners decide to undertake, they may need to contribute additional amounts in order to fund these proposed improvements. However, the partners are not obligated to fund any such improvements to the extent that they exceed the amounts reserved for under the management agreement.

~~Principal~~ITEM ~~Sources~~6. ~~and Uses of Cash~~ EXHIBITS

~~Our~~(a) ~~principal~~The ~~source~~exhibits oflisted ~~cash~~on isthe ~~from~~accompanying ~~operations.~~Exhibit ~~Our~~Index ~~principal uses of cash~~ are tofiled ~~make~~as ~~debt~~part ~~service~~of ~~payments,~~this ~~make~~report ~~payments~~and tosuch ~~the~~Exhibit ~~property~~Index ~~improvement~~is ~~fund~~incorporated ~~and to~~herein ~~make~~by ~~distributions to the partners~~reference.

~~Cash~~(c) provided by operations for the first three quarters of 2002 was $27.3 million compared to $31.1 million for the first three quarters of 2001. The decrease in cash provided by operations is due primarily to a decrease in net income. This was partially mitigated by the deferral of payment of incentive management fees. Exhibits

Cash used in investing activities was $12.4 million and $14.1 million for the first three quarters of 2002 and 2001, respectively. Cash used in investing activities for the first three quarters of 2002 includes capital expenditures of $3.9 million (including $0.6 million of owner-funded capital expenditures), primarily related to renovations and replacements of furniture, fixtures and equipment at our hotels, as compared to capital expenditures of $3.5 million in the first three quarters of 2001. The property improvement fund increased by $8.6 million for the thirty-six weeks ended September 6, 2002 compared to an increase of $10.5 million for the thirty-six weeks ended September 7, 2001. Contributions to the property improvement fund declined as a result of lower sales at the hotels.

Exhibit No.		Description

31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.0		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002.*

~~Cash~~* ~~used~~This incertification ~~financing~~is ~~activities~~being ~~was~~furnished ~~$22.6~~solely ~~million~~to ~~and~~accompany ~~$24.7 million for~~ the ~~first~~Report ~~three~~pursuant ~~quarters~~to of18 ~~2002 and 2001, respectively~~U. ~~We repaid $12~~S.7 ~~million~~1350, and ~~$11.8~~is ~~million,~~not ~~respectively,~~being offiled ~~principal~~for onpurpose ~~the~~of ~~commercial mortgage-backed~~Section ~~securities~~18 ~~during~~of the ~~first~~Securities ~~three~~Exchange ~~quarters~~Act of ~~2002~~1934, ~~and~~as ~~2001.~~amended, ~~Cash~~and ~~used~~is innot ~~financing activities included $9.9 million of cash distributions~~ to ~~the~~be ~~partners~~incorporated ~~during~~by ~~the~~reference ~~first~~into ~~three~~any ~~quarters~~filing of ~~2002~~the ~~compared~~Company towhether ~~cash~~made ~~distributions~~before of ~~$12.9~~ ~~million~~after ~~during~~ the ~~first~~date ~~three~~hereof, ~~quarters~~regardless of ~~2001.~~any Asgeneral ~~noted~~incorporation language in ~~Note~~such ~~3, due to the Partnership’s failure to reach certain cash flow thresholds required by the senior notes indenture, no further distributions to the partners will be made for the remainder of 2002~~filing.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

The Partnership does not have significant market risk with respect to interest rates, foreign currency exchanges or other market rate or price risks, and we do not hold any financial instruments for trading purposes. As of September 6, 2002, all of our debt is fixed rate.

Item 4. Controls and Procedures

The Partnership maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Partnership’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Partnership’s management, including its Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-14(c). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Also, the Partnership has investments in certain unconsolidated entities. As the Partnership does not control or manage these entities, its disclosure controls and procedures with respect to such entities are necessarily substantially more limited than those it maintains with respect to its consolidated subsidiaries.

Within 90 days prior to the date of this report, the Partnership carried out an evaluation, under the supervision and with the participation of the Partnership’s management, including the Partnership’s Principal Executive Officer and the Partnership’s Principal Financial Officer, of the effectiveness of the design and operation of the Partnership’s disclosure controls and procedures. Based on the foregoing, the Partnership’s Principal Executive Officer and Principal Financial Officer concluded that the Partnership’s disclosure controls and procedures were effective.

There have been no significant changes in the Partnership’s internal controls or in other factors that could significantly affect the internal controls subsequent to the date the Partnership completed its evaluation.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

None.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.

COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP By: CBM TWO LLC General Partner

August 4, 2003	COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP

	By:	/s/ CBM TWO LLC
		CBM TWO LLC
		General Partner

	By:	/s/ MATHEW J. WHELAN
		Mathew J. Whelan Vice President (Chief Accounting Officer)

		October 22, 2002				By:		/s/ Mathew J. Whelan
								Mathew J. Whelan Vice President

CERTIFICATIONS

I, Robert E. Parsons, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Courtyard by Marriott II Limited Partnership;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

(a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

(c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

(a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6. The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: October 22, 2002

/s/ Robert E. Parsons, Jr.

Robert E. Parsons, Jr.

President (Principal Executive Officer)

I, W. Edward Walter, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Courtyard by Marriott II Limited Partnership;

(b) evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

(c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

Date: October 22, 2002

/s/ W. Edward Walter

W. Edward Walter

Principal Financial Officer

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Filing Compare · COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP /DE/