MCLEAN, VA, December 30, 2003 � Highland Hospitality Corporation (NYSE:HIH) announced today that it has acquired the 252-room Plaza San Antonio Marriott for a purchase price of $32.5 million, plus customary closing adjustments.  Highland�s net investment will equate to approximately $129,300 per room.  Highland purchased the asset from Host Marriott Corporation.  Crestline Hotels & Resorts, a leading hotel management company, will manage the hotel.

Plaza San Antonio, A Marriott Hotel   555 South Alamo Street San Antonio, Texas

The 252-room Plaza San Antonio Marriott is situated on over 6.2 acres of landscaped grounds near San Antonio�s famed River Walk and is directly across the street from the city�s convention center.  The hotel�s downtown location also provides convenient access to major demand generators such as the downtown financial district and the Alamo Dome.  The hotel offers over 16,000 square feet of meeting space, and offers such amenities a sauna and whirlpool, a heated outdoor swimming pool and complimentary transportation to the downtown financial district.  In conjunction with the acquisition, Highland Hospitality plans to complete a comprehensive renovation of the guestrooms, lobby, restaurant and bar in 2004. 

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 Plaza San Antonio Marriott property, the Company now owns four hotel properties with an aggregate of 978 rooms.  

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.