For the year ended 1998 versus 1997, room revenue per available room (RevPAR) increased 6.8 percent to $96.17 for comparable hotels and 5.3 percent to $93.00 versus $88.33 for the total portfolio. For the year ended December 31, 1998, pro forma/actual lease revenues were $62.5 million, a 36 percent increase over the same period of 1997. Combined pro forma/actual net income was $17.4 million, or $1.15 per share (basic and diluted), compared to pro forma net income of $14.2 million, or $.94 per share (basic and diluted), in the prior year.

"In our first year as a public company, LaSalle Hotel Properties has purchased one luxury urban hotel and one upscale resort property, which created strategic relationships with two new operators: Hyatt Hotels Corporation and Noble House Hotels and Resorts. We also initiated a three- year, more than $55 million capital program, substantially completed renovations to upgrade the Dallas and New Orleans Le Meridien hotels and announced a dividend re-investment plan," said Jon Bortz, President and CEO of LaSalle Hotel Properties.
Throughout 1999, LaSalle Hotel Properties intends to complete renovations totaling approximately $23 million to reposition the Marriott Seaview as a four-star resort, complete phase one and begin phase two improvements in order to reposition the San Diego Paradise Point Resort as a four-star property and complete renovations at the Radisson South convention hotel in Bloomington, Minnesota, and the Radisson Tampa.

"These substantial reinvestment programs play a critical role in maintaining and improving the competitiveness of Company's hotels, keeping our hotel guests satisfied with their lodging experience and growing our earnings. We are already experiencing benefits at our renovated Le Meridien properties in New Orleans and Dallas, " added Mr. Bortz.

On January 15, LaSalle Hotel Properties paid its fourth quarter dividend of $0.375 per share. For 1998, the Company paid $1.01 in dividends ($1.50 annualized) of which 100 percent represented dividend income for tax purposes. On an annualized basis, the dividend yield would be 11.8 percent based on the stock's closing price on January 22, 1999.

Fourth Quarter Results

For the fourth quarter 1998, LaSalle Hotel Properties reported an increase in FFO of 21 percent to $8.3 million versus $6.9 million for pro forma fourth quarter 1997.  On a per share/unit basis, the fourth quarter 1998 FFO was $.45 versus pro forma 1997 fourth quarter  FFO of $.38.

For the fourth quarter of 1998, RevPAR increased 5.8 percent to $89.87 compared to $84.91 in the same period of 1997, excluding the Radisson Hotel Tampa at Sabal Park which was undergoing significant renovations during the quarter. For the total portfolio, RevPAR in the fourth quarter 1998 increased 4.5 percent to $87.40 compared to $83.64 in the prior year period.

"In 1999, assuming the economy continues to grow moderately, we are projecting between three and five percent RevPAR growth for our hotel portfolio," said Mr. Bortz. "Our properties, along with other upscale and luxury segments of the hotel industry, continue to run at high occupancy rates, which should allow us to continue to increase prices above inflation in 1999."

Participating lease revenues for the fourth quarter of 1998 increased 45 percent over the pro forma fourth quarter of 1997 to $15.2 million. Net income for the 1998 fourth quarter was down 20 percent to $2.1 million, or $.14 per share (basic and diluted), from pro forma net income of $2.7 million, or $.18 per share (basic and diluted), for the fourth quarter of 1997. Since the Company had no significant operations until after the completion of its initial public offering on April 29, 1998, pro forma operating results are being presented as if the Company had completed its initial public offering, acquired its interest in its ten initial upscale and luxury full service hotels, and leased these hotels under participating leases as of January 1, 1997. The pro forma results are based upon available information and certain assumptions that management of the Company believes are reasonable. For the year ended December 31, 1998, operating results on a combined basis are presented as six months pro forma for the first two quarters and six months actual results for the last two quarters.

The pro forma results are not necessarily indicative of what the actual results of operations would have been for the year ended December 31, 1997 or the six month period ended June 30, 1998, had the Company completed the initial public offering and acquired the initial ten upscale and luxury hotels on the date indicated nor does it purport to represent the future results of operations of the Company. For the two hotels acquired during the second quarter of 1998, their operating results are being presented in the pro forma results as of the date of the completion of each respective acquisition.

LaSalle Hotel Properties is a leading multi-tenant, multi-operator real estate investment trust (REIT) which owns 12 upscale and luxury full-service hotels, totaling 4,110 guest rooms in nine states. The company is focused on investing in upscale and luxury full-service hotels located primarily in major business and urban, resort and convention markets. LaSalle Hotel Properties seeks to grow through strategic relationships with premier internationally recognized hotel operating companies including Le Meridien Hotels Resorts, Marriott International, Inc., Radisson Hotels International, Inc., Hyatt Hotels Corporation, Durbin Companies, Outrigger Lodging Services and Noble House Hotels Resorts.

The REIT serves as the exclusive vehicle for LaSalle Partners' hotel investment activities in the United States. Founded in 1968, LaSalle Partners Incorporated (NYSE: LAP) is a leading vertically integrated global real estate services firm providing management services, corporate and financial services, and investment services for public and private institutions and other real estate owners and investors worldwide.
 
 

• Fourth quarter includes Radisson Tampa only.
• Twelve months ended December 31 includes Radisson Tampa for quarters three and four.
• Le Meridien Dallas and Radisson South for quarter three.
• Comparable hotels include all Hotels excluding those in Non-Comparable. 

Statements in this press release regarding, among other things, future financial results and performance, achievements, plans and objectives may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance, achievements, plans and objectives of the Company to be materially different from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include those discussed under "Risk Factors" and elsewhere in the Company's prospectus filed as part of its registration statement (333-45647) and in other periodic reports filed with the Securities and Exchange Commission. Statements speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to update or revise any forward- looking statements contained herein to reflect any change in Company expectations or results, or any change in events.