For the quarter ended June 30, 2000, room revenue per available room (RevPAR) increased 7.5 percent to $111.55 compared to $103.72 in the second quarter 1999, primarily due to a 7.2 percent increase in average daily rate (ADR).  Occupancy in the quarter also improved 0.2 percentage points. For the non-comparable hotels which underwent renovations in the second quarter of 1999 or 2000, RevPAR increased 11.9 percent as ADR increased 10.9 percent over the prior year.

The Company�s EBITDA, which is defined as earnings before interest, taxes, depreciation, amortized expenses and write-down of properties held for disposition, increased 13.4 percent to $18.6 million for the quarter ended June 30, 2000 compared to $16.4 million in the second quarter 1999. Year-to-date through June 30, 2000, the Company�s EBITDA grew 12.2 percent over the prior year to $32.5 million.

�The second quarter operating results exceeded expectations,� said Jon Bortz, President and CEO of LaSalle Hotel Properties. �The overall strength of the economy coupled with robust demand from group, business and leisure travelers drove strong revenue growth at our hotels in the second quarter.

�Performance was led by our resort-oriented hotels, which achieved RevPAR gains of 13.0 percent during the quarter. Additionally, the double-digit RevPAR growth experienced by our properties that were recently renovated or repositioned underscores the substantial benefits derived from these improvement programs. We are continuing to reap superior returns through the strategic reinvestment of capital in our hotels.

�Our booking trends have been brisk during the first half of 2000,� added Mr. Bortz. �Although economists have been forecasting economic growth to moderate during the second half of this year, the major capital investments the Company made in 1999 and throughout 2000 should enable us to achieve significant revenue gains during the second half of this year. We continue to expect the second half of the year to be stronger than the first half, notwithstanding the unexpected strength of the second quarter. As a result, we now anticipate a portfolio-wide RevPAR increase of 5 to 7 percent for the year, which significantly exceeds our prior estimates of 3 to 4 percent. With supply growth moderating, and all segments of hotel demand expected to continue to remain healthy, we are optimistic about our ability to continue to drive room rate and RevPAR at our hotels.�

Participating lease revenues for the second quarter 2000 increased 7.7 percent to $21.9 million over the prior year period. Net income for the second quarter 2000 was $3.7 million, or $0.22 per share (basic and diluted), compared to net income of $5.2 million, or $0.34 per share (basic and diluted) for the second quarter 1999. Consistent with its philosophy of divesting assets that do not fit into its long-term strategy, the Company entered into a purchase and sale agreement for the disposition of the Holiday Inn Visalia. Based upon the contract price, the book value of the asset was reduced by $1.3 million.
 

During the second quarter, the Company completed its approximately $9.5 million renovation and expansion of The Hotel Viking, a 237-room resort hotel located in Newport, Rhode Island. Since the historic hotel�s grand re-opening in the second quarter, average daily room rates have increased in excess of $30.00, or more than 25 percent as compared to the second quarter of 1999. �The repositioning of The Hotel Viking from a three-star to four-star resort has been extremely positive. We are excited about the hotel�s recent performance and outlook for the remainder of the year and beyond,� said Mr. Bortz.

Situated on Bellevue Avenue in Newport, Rhode Island, the 182-room Hotel Viking and adjacent 12-room historic inn is located just blocks from Newport Harbor. The historic four-acre resort features an indoor pool, fitness center, two restaurants and two lounges, including a rooftop bar. The facilities also include 29,000 square feet of meeting space and the fully-restored, 250-seat Kay Chapel.

LaSalle Hotel Operating Partnership, L.P. (�LHOP�), the partnership of which LaSalle Hotel Properties owns 91.5%, has reached a preliminary agreement with the shareholders of LaSalle Hotel Lessee, Inc., (�LHL�), to acquire LHL for $500,000. LHL leases four of the Company�s owned hotels, including Marriott Seaview Resort, Marriott LaGuardia, Omaha Marriott and Harborside Hyatt. This transaction is expected to be effective January 1, 2001. Once acquired, LHL will be a 100% owned subsidiary of LHOP as provided for under the taxable-REIT subsidiary provisions. It is currently anticipated that the full acquisition price for LHL will be expensed in 2001. On a per share/unit basis, this acquisition is expected to be $0.00 - $0.01 accretive in 2001, and $0.02 - $0.03 accretive each year thereafter. All of LHOP�s remaining owned hotels are, and are expected to continue to be, leased directly to the current operators of those respective hotels.

At the end of the second quarter, LaSalle Hotel Properties had total outstanding debt of approximately $283.0 million, including its portion of the joint venture secured debt. On July 27, LaSalle Hotel Properties obtained three individual 10-year fixed-rate loans totaling $74.5 million at a rate of 8.08 percent. The proceeds of these loans were used to reduce LaSalle Hotel Properties� outstanding borrowings under its existing $235.0 million line of credit facility. With the closing of the fixed debt on July 27, the outstanding balance on the line of credit was reduced to approximately $113.0 million. Currently, the company�s fixed rate debt represents over 55 percent of the total outstanding debt.

On July 14, LaSalle Hotel Properties announced an increase in its second quarter 2000 dividend to $0.385 per share.

The dividend is payable on August 14, 2000 to the shareholders of record at the close of business on July 28, 2000.  Based on the stock�s closing price on July 31, 2000, the second quarter dividend represents an annualized dividend yield of 10.7 percent. The Company has raised its dividend every year since it went public.
 
 

Three months ended June 30 include Hotel Viking and San Diego Paradise Point.

Six months ended June 30 include LeMontrose, Hotel Viking, Harborside Hyatt, Radisson South, Marriott Seaview, and San Diego Paradise Point in Quarter 1; Hotel Viking and San Diego Paradise Point in Quarter 2.  Paradise Point in Quarter 2.

Comparable Hotels include all Hotels excluding those in Non-Comparable hotels.

LaSalle Hotel Properties is a leading multi-tenant, multi-operator real estate investment trust which owns or has interests in 14 upscale and luxury full-service hotels, totaling approximately 5,500 guest rooms in 14 markets in eleven states. LaSalle Hotel Properties is focused on investing in upscale and luxury full-service hotels located in urban, resort and convention markets. The Company 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., Crestline Hotels & Resorts, Inc., Outrigger Lodging Services, Noble House Hotels & Resorts and Hyatt Hotels Corporation.

LaSalle Hotel Properties serves as the exclusive vehicle for Jones Lang LaSalle�s hotel investment activities in the United States. Jones Lang LaSalle (NYSE: JLL - news) is the world�s leading real estate services and investment management firm with more than $21.5 billion of assets under management and operating across more than 100 key markets on five continents.

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.