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Highland Hospitality Acquiring the 673-room Renaissance Nashville
for $77 million, Approximately $114,000 per Key
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MCLEAN, VA, February 17, 2006 - Highland Hospitality Corporation (NYSE:HIH), a lodging real estate investment trust, or REIT, announced today the signing of a definitive agreement to acquire the 673-room Renaissance Nashville hotel in Nashville, Tennessee.  The purchase price for the hotel is $77 million, or approximately $114,000 per key.   The Company intends to close on this acquisition within the next thirty days following approval of the sale by the ground lessor, and will enter into a long-term management contract with an affiliate of Marriott International, Inc. (NYSE:MAR) to operate the hotel under the Renaissance flag.  Following the acquisition, Highland plans to invest approximately $6.5 million in a two-year property improvement plan at the hotel.  

James L. Francis, Highland’s President and CEO, stated, “We are pleased to announce our impending acquisition of the Renaissance Nashville hotel.  This property is centrally located in Nashville’s business district, and within walking distance to several of the city’s attractions.  We believe our investment in this hotel will provide very attractive stabilized returns for our shareholders that will continue to benefit from a growing Nashville market with high barriers-to-entry.”  

Highland Hospitality Corporation is a self-advised lodging real estate investment trust, or REIT, focused on hotel investments primarily in the United States. The Company currently owns 23 hotel properties with an aggregate of 6,708 rooms in 11 states, Washington DC and Mexico.  Additional information can be found on the Company’s website at www.highlandhospitality.com.

Certain statements and assumptions in this press release contain or are based upon “forward-looking” information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  

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Contact:

Highland Hospitality Corporation
http://www.highlandhospitality.com

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Also See: Highland Hospitality Corporation Acquiring the 144-room Churchill Hotel in Washington, D.C. for $48.75 million; Appoints Crestline to Manage the Property as an Independent / December 2005
Highland Hospitality Corporation Acquiring 385-room Hilton Boston Back Bay for $110.0 million / October 2005


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