Highland Hospitality Announces Acquisition

Highland Hospitality Corporation announced today that it has acquired the
158-room Hilton Garden Inn BWI Airport hotel for a purchase price of $21.9
million, plus customary closing adjustments. Highland purchased the asset
from LTD Management Company, a private hospitality firm based in
Chesapeake, Virginia. Crestline Hotels & Resorts, Inc., a leading hotel
management company, will manage the hotel.

James L. Francis, President and CEO, stated, “The Hilton Garden Inn BWI
Airport hotel is the seventh hotel Highland has acquired. The acquisition
of this hotel fits our strategy to invest in upscale full-service and
premium limited-service and extended stay hotels in major urban, airport
and suburban markets. With the expansion and subsequent growth potential
of the Baltimore/Washington International Airport, this hotel should be
well- positioned to generate increasing returns and long-term value
appreciation.”
The 158-room Hilton Garden Inn BWI Airport hotel opened in June 2001 and
is located within two miles of the Baltimore/Washington International
Airport and within eight miles of Baltimore`s Inner Harbor area. The hotel
contains over 2,000 square feet of meeting space and provides such
amenities as complimentary high-speed internet access, a pool and fitness
room and airport shuttle transportation. In addition to the airport, other
demand generators within the airport submarket include such companies as
Northrop Grumman, Kodak, MCI, All Meade, and the National Security Agency.

Highland Hospitality Corporation is a newly formed, self-advised lodging
real estate investment trust, or REIT, focused on hotel investments
primarily in the United States. With the acquisition of the Hilton Garden
Inn BWI Airport property, the Company now owns seven hotel properties with
an aggregate of 1,725 rooms in five states. Additional information can be
found on the company`s website at http://www.highlandhospitality.com/.

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