BETHESDA, Md., July 20, 2000 - Host Marriott Corporation (NYSE: HMT - news) today reported record diluted Comparative Funds From Operations per share for the second quarter 2000 of $.55 per diluted share, an improvement of nearly 15 percent over second quarter 1999. On a year-to-date basis, diluted Comparative FFO per share increased over 9 percent to $.94 per diluted share versus 1999. The company also reported that Earnings Before Interest Expense, Income Taxes, Depreciation and Amortization and other non- cash items (�EBITDA�) from continuing operations was $282 million for the 2000 second quarter and $513 million year-to-date, an increase of eleven percent and seven percent, respectively, over EBITDA for the same periods in 1999.

The company also reported that REVPAR at its comparable hotels grew by seven percent in the 2000 second quarter over the prior year. Excluding nine additional properties which were impacted by substantial construction or renovation, REVPAR grew by 8.2 percent in the second quarter.

Mr. Christopher J. Nassetta, president and chief executive officer, stated, �We are exceptionally pleased with our operating results in the second quarter which significantly exceeded both our and market expectations. The improvement in our hotel operations in the second quarter is a result of much stronger than expected economic growth and continued strength in both short- term group bookings and from individual business travelers. Our core strategy of focusing on high-quality urban, airport and resort/convention hotels located in strong markets with high barriers to entry and strong brand affiliations continues to be validated by our outstanding results.�

Mr. Nassetta added, �We continue to look for opportunities to make prudent investments which provide superior returns on our invested capital and improve the long-term value of our assets. During the second quarter, we acquired a controlling economic interest in the 772-room JW Marriott Hotel, which is ideally located just two blocks from the White House in Washington, DC. In addition, the Orlando World Center Marriott hotel recently completed a major renovation, including the addition of 500 hotel rooms and an additional 15,000 square feet of meeting space to an already spectacular property.�

Mr. Robert E. Parsons, executive vice president and chief financial officer, stated, �In addition to the strategic deployment of capital, we continue to strengthen our balance sheet and maximize our financial flexibility. For example, during the second quarter, we successfully modified our revolving line of credit and term loan facility to obtain more flexible terms and extend the life of the revolver by two years. With initiatives such as this, we feel we are well prepared to take advantage of opportunities the market may offer us in the future.�

Mr. Parsons also noted that, �We continue to evaluate market conditions and will repurchase our stock and reduce debt as opportunities present themselves to sell assets that do not meet our core portfolio profile or present unique opportunities to unlock value from our hotel assets.�

Our hotel revenues reflect rental income from leases, which are calculated based on hotel-level sales. Second quarter 2000 hotel sales were $1,122 million, a six percent increase over 1999 second quarter hotel sales of $1,054 million. 

Year-to-date hotel sales for 2000 were $2,080 million, an increase of five percent over 1999 year-to-date hotel sales of $1,985 million. We reported second quarter 2000 rental income of $183 million versus $187 million for the second quarter 1999 and year-to-date 2000 rental income of $356 million versus $358 million for year-to-date 1999.  The reported rental income amounts for 2000 and 1999 exclude contingent rent deferred under SEC regulations (Staff Accounting Bulletin 101, �SAB 101�) of $168 million and $138 million for the second quarter 2000 and 1999 and $291 million and $253 million year-to-date 2000 and 1999, respectively, because they are contingent upon achieving annual levels of hotel sales. The adoption of SAB 101 will have no impact on the full year 2000 results.
The net loss available to common shareholders for the quarter ended June 16, 2000 increased to $58 million compared to $31 million for the quarter ended June 18, 1999. For the twenty-four weeks ended June 16, 2000, the net loss available to common shareholders increased to $116 million compared to $75 million for the twenty-four weeks ended June 18, 1999. Second quarter and year-to-date 2000 results include $5.1 million and $10.2 million, respectively, in dividends on preferred stock, which was issued during the second half of 1999.
 

Host Marriott is a lodging real estate company which currently owns or holds controlling interests in 122 upscale and luxury hotel properties primarily operated under premium brands such as Marriott, Ritz-Carlton, Hyatt, Four Seasons, Hilton and Swissotel. 

This press release includes various references to Comparative FFO and EBITDA. Comparative FFO represents Funds From Operations, as defined by the National Association of Real Estate Investment Trusts, plus contingent rental revenues. We consider Comparative FFO and EBITDA to be indicative measures of our operating performance, due to the significance of our long-lived assets and because such data is considered useful by the investment community to better understand our results, and can be used to measure our ability to service debt, fund capital expenditures and expand our business. However, such information should not be considered as an alternative to net income, operating profit, cash from operations, or any other operating or liquidity performance measure prescribed by generally accepted accounting principles. 

Certain matters discussed in this press release are forward-looking statements within the meaning of federal securities regulations.