REGISTRATION RIGHTS AGREEMENT

                              (PRINCIPAL INVESTORS)



         THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is made and

entered into as of June 29, 2004, among Strategic Hotel Capital, Inc., a

Maryland corporation (the "Company"), WHSHC, L.L.C., a Delaware limited

liability company ("Whitehall 7"), W9/WHSHC, L.L.C. I, a Delaware limited

liability company ("Whitehall 9"; and, together with Whitehall 7, "Whitehall"),

The Prudential Insurance Company of America, a New Jersey corporation

("Prudential Insurance"), PIC Realty Corporation, a Delaware corporation ("PIC";

and, together with Prudential Insurance, "Prudential"), and Strategic Value

Investors, LLC, a Delaware limited liability company ("SVI").



         WHEREAS, Strategic Hotel Capital, L.L.C., a Delaware limited liability

company ("SHC LLC"), Whitehall, Prudential and SVI are parties to a Transfer and

Registration Rights Agreement dated as of October 31, 1999 (the "SHC LLC

Agreement");



         WHEREAS, concurrently with the execution of this Agreement, the Company

will effect an initial public offering of shares of its common stock ("IPO");

and



         WHEREAS, the parties desire to provide each Investor (as defined

herein) with certain registration rights substantially analogous to those under

the SHC LLC Agreement.



         NOW, THEREFORE, in consideration of the foregoing, the parties hereto

agree as follows:



1.   DEFINITIONS.



         As used in this Agreement, the following terms shall have the following

respective meanings:



         "Affiliate": with regard to a Person, a Person that controls, is

controlled by, or is under common control with, such original Person. For

purposes of this definition, "control" when used with respect to any Person

means the power to direct the management and policies of such Person, directly

or indirectly, whether through the ownership of voting securities, by contract

or otherwise; and the terms "affiliated," "controlling" and controlled" have

meanings correlative to the foregoing.



         "Closing Price": the reported last sale price of a unit of a security,

on a given day, regular way, or, in case no such sale takes place on such day,

the average of the reported closing bid and asked prices regular way, in each

case on the New York Stock Exchange Composite Tape, or, if the security is not

listed or admitted to trading on such exchange, on the American Stock Exchange

Composite Tape, or, if the security is not listed or admitted to trading on such

exchange, the principal national securities exchange on which the security is

listed or admitted to trading, or, if the security is not listed or admitted to

trading on any national securities exchange, the closing sales price, or, if

there is no closing sales price, the average of the closing bid and asked

prices, in the Nasdaq Stock Market, Inc., or, if not so reported, as reported by

the National Quotation Bureau, Incorporated, or any successor thereof, or, if

not so reported, the average of the closing bid and asked prices as furnished by

any member of the National Association of Securities Dealers, Inc. selected from

time to time by the Company for that purpose, or, if no



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such prices are furnished, the fair market value of the security as determined

in good faith by the board of directors of the Company, which determination

shall be based upon recent issuances or current offerings pursuant to bona fide

private offerings of the same class of security by the Company; provided,

however, that any determination of the "Closing Price" of any security hereunder

shall be based on the assumption that such security is freely transferable

without registration under the Securities Act.



         "Commission": the Securities and Exchange Commission or any other

applicable Federal agency at the time administering the Securities Act.



         "Company": as defined in the preamble, and shall include, where the

context requires any Person into which the Company is merged or with which the

Company is consolidated.



         "Demand Registration": an effective registration pursuant to a request

made by an Investor pursuant to Section 2.1.



         "Exchange Act":  the Securities Exchange Act of 1934, as amended.



         "First Effective Date": the effective date of the First Registration

Statement in the event of a Proration.



         "First Registration Statement": in the event of a Proration, the

registration statement initially filed in which all securities sought to be

included were not so included.



         "Investor": means each of Whitehall and Prudential including each

member of the Whitehall Group and the SVI Group; provided that if (i) any member

of the SVI Group liquidates all of its assets by distributing such assets to its

members, investors or beneficial owners ("distributees") and (ii) there is no

Shelf Registration or other effective registration statement that would permit

such member of the SVI Group to distribute Securities that are not subject to

restrictions on transfer under the Exchange Act or the Securities Act to such

distributees then such distributees shall be included in the definition of

"Investor" hereunder.



         "Membership Units": any membership interests in Strategic Hotel

Funding, L.L.C., a Delaware limited liability company.



         "Overhang Risk": a substantial risk that the sale of some or all of the

Shares sought to be sold will substantially reduce the proceeds or price per

unit to be derived from such sale.



         "Person": an individual, partnership, corporation, company (including a

limited liability company), trust or unincorporated organization, or a

government or agency or political subdivision thereof.



         "Proration": any reduction pursuant to Section 2.1(b) in the number of

securities to be included in a Demand Registration.



         "Requesting Investor": as defined in Section 2.1.



         "Resale Rules":  as defined in Section 4.3.



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{PAGE}



         "Rockmark Registration Rights Agreement": the Registration Rights

Agreement of even date herewith between the Company, the Investors identified on

the signature pages thereto, and Rockmark Corporation, as Investor

Representative.



         "Saleable Amount": the greatest number of securities which would not

create an Overhang Risk.



         "Securities": the Shares and the Membership Units owned by any

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