| July 01, 2011

Hotel Online News for the Hospitality Executive

BETHESDA, Md.–(July 20, 2011)–LaSalle Hotel Properties (NYSE: LHO) today announced results for the quarter ended June 30, 2011. The Company’s results include the following:

Second Quarter Year-to-Date 2011 2010 2011 2010 ($’s in millions except per share data) ($’s in millions except per share data) Total Revenue $ 202.6 $ 165.7 $ 340.9 $ 273.9 Net income/(loss) to common shareholders $ 16.7 $ 8.0 $ (2.5 ) $ (17.8 ) Net income/(loss) to common shareholders per diluted share $ 0.20 $ 0.11 $ (0.03 ) $ (0.27 ) EBITDA(1) $ 67.2 $ 55.5 $ 90.5 $ 70.3 Adjusted EBITDA(1) $ 67.5 $ 55.5 $ 92.4 $ 71.8 FFO(1) $ 44.7 $ 35.9 $ 53.2 $ 37.4 Adjusted FFO(1) $ 45.0 $ 35.9 $ 55.0 $ 38.8 FFO per diluted share(1) $ 0.54 $ 0.52 $ 0.68 $ 0.56 Adjusted FFO per diluted share(1) $ 0.55 $ 0.52 $ 0.70 $ 0.58

(1)

See tables later in press release, which list adjustments that reconcile net income to earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted EBITDA, funds from operations (“FFO”), FFO per share, adjusted FFO and adjusted FFO per share. EBITDA, adjusted EBITDA, FFO, FFO per share, adjusted FFO and adjusted FFO per share are non-GAAP financial measures. See further discussion of these non-GAAP measures and reconciliations to net income later in this press release.

Second Quarter Highlights

  • RevPAR: Room revenue per available room (“RevPAR”) for the quarter ended June 30, 2011 increased 6.3 percent to $168.97, as a result of a 4.6 percent increase in average daily rate (“ADR”) to $202.52 and a 1.6 percent increase in occupancy to 83.4 percent.
  • Hotel EBITDA margin: The Company’s hotel EBITDA margin for the quarter ended June 30, 2011 was 35.1 percent, which was an improvement of 180 basis points compared to the comparable prior year period.
  • Adjusted EBITDA: The Company’s adjusted EBITDA was $67.5 million, an increase of 21.6 percent over the second quarter of 2010.
  • Adjusted FFO: The Company generated adjusted FFO of $45.0 million, or $0.55 per diluted share, compared to $35.9 million or $0.52 per diluted share in the second quarter of 2010.
  • Acquisitions: The Company announced that it entered into a Purchase and Sale Agreement to acquire the Park Central Hotel in Midtown, Manhattan for $405.5 million. The transaction is now expected to close towards the end of the fourth quarter of 2011 due to seller related reasons.
  • Capital Markets:

    • During April 2011, the Company sold 417,037 common shares through its ATM offering program resulting in net proceeds of approximately $11.1 million.
    • On April 26, 2011, the Company sold 7,896,612 common shares in an underwritten public offering, resulting in net proceeds of $216.7 million. These proceeds are intended to partially fund the acquisition of the Park Central Hotel.
  • Capital Investments: The Company invested $10.8 million of capital in its hotels, including the completion of guestroom renovations at the Westin Copley Place hotel, Hotel Rouge, Topaz Hotel and Hotel Viking.
  • Dividends: On June 15, 2011, the Company declared a second quarter 2011 dividend of $0.11 per common share of beneficial interest.

“We are very pleased with the performance of our portfolio during the quarter,” said Michael D. Barnello, President and Chief Executive Officer of LaSalle Hotel Properties. “Our portfolio delivered strong RevPAR gains and continued to deliver exceptional EBITDA margins. We remain excited about the recovery in the lodging industry and within our portfolio as well.”

Year-to-Date Highlights

For the six months ended June 30, 2011, RevPAR increased 6.6 percent to $142.23, with ADR growth of 5.2 percent to $189.04 and an occupancy increase of 1.4 percent to 75.2 percent. The Company’s hotel EBITDA margin was 29.4 percent, an increase of 195 basis points compared to the comparable prior year period. The Company invested $20.0 million of capital in its hotels during the six months ended June 30, 2011.

Balance Sheet

As of June 30, 2011, the Company had total outstanding debt of $688.0 million. At the end of the quarter, the Company had no borrowings on either of its credit facilities. Total debt to trailing 12 month Corporate EBITDA (as defined in the Company’s senior unsecured credit facility) was 3.4 times as of June 30, 2011. For the second quarter, the Company’s weighted average interest rate was 5.3 percent. As of June 30, 2011, based on the Company’s covenants under its senior unsecured credit facility, the Company’s EBITDA to interest coverage ratio was 4.9 times and its fixed charge coverage ratio was 2.4 times. As of June 30, 2011, the Company had $231.1 million of cash and cash equivalents on its balance sheet and capacity of $471.5 million available on its credit facilities.

2011 Outlook

The Company maintains its RevPAR growth and EBITDA margin expectations for the full year and has updated its outlook to reflect the issuance of common stock to date, as follows:

Low-end High-end ($’s in millions except per share data) RevPAR growth 6.0% 8.0% Adjusted EBITDA $ 196.0 $ 206.0 Adjusted FFO $ 120.1 $ 128.1 Adjusted FFO per diluted share $ 1.47 $ 1.57 Portfolio hotel EBITDA margins 30.0% 31.0% Total capital investments $ 65.0 $ 70.0

The Company’s outlook excludes the Park Central acquisition.

Earnings Call

The Company will conduct its quarterly conference call on Thursday, July 21, 2011 at 10:00 AM EDT. To participate in the conference call, please dial (888) 684-1281. Additionally, a live webcast of the conference call will be available through the Company’s website. To access, log on to http://www.lasallehotels.com. A replay of the conference call will be archived and available online through the Investor Relations section of http://www.lasallehotels.com.

LaSalle Hotel Properties is a leading multi-operator real estate investment trust owning 35 upscale full-service hotels, totaling over 8,700 guest rooms in 13 markets in 9 states and the District of Columbia. The Company focuses on owning, redeveloping and repositioning upscale full-service hotels located in urban, resort and convention markets. LaSalle Hotel Properties seeks to grow through strategic relationships with premier lodging companies, including Westin Hotels and Resorts, Hilton Hotels Corporation, Outrigger Lodging Services, Noble House Hotels & Resorts, Hyatt Hotels Corporation, Benchmark Hospitality, White Lodging Services Corporation, Thompson Hotels, Sandcastle Resorts & Hotels, Davidson Hotel Company, Denihan Hospitality Group, the Kimpton Hotel & Restaurant Group, LLC, Accor, Destination Hotels & Resorts, HEI Hotels & Resorts, JRK Hotel Group, Inc. and Viceroy Hotel Group.

This press release, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “will,” “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project” or similar expressions. Forward-looking statements in this press release include, among others, statements about outlook for RevPAR, adjusted FFO, adjusted EBITDA and derivations thereof and related assumptions and the Company’s expectation of the closing date of the Park Central Hotel. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control and which could materially affect actual results, performances or achievements. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, (i) the Company’s dependence on third-party managers of its hotels, including its inability to implement strategic business decisions directly, (ii) risks associated with the hotel industry, including competition, increases in wages, energy costs and other operating costs, actual or threatened terrorist attacks, downturns in general and local economic conditions and cancellation of or delays in the completion of anticipated demand generators, (iii) the availability and terms of financing and capital and the general volatility of securities markets, (iv) risks associated with the real estate industry, including environmental contamination and costs of complying with the Americans with Disabilities Act and similar laws, (v) interest rate increases, (vi) the possible failure of the Company to qualify as a REIT and the risk of changes in laws affecting REITs, (vii) the possibility of uninsured losses, (viii) risks associated with redevelopment and repositioning projects, including delays and cost overruns and (ix) the risk factors discussed in the Company’s Annual Report on Form 10-K as updated in its Quarterly Reports. Accordingly, there is no assurance that the Company’s expectations will be realized.Except as otherwise required by the federal securities laws, the Company disclaims any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

For additional information or to receive press releases via e-mail, please visit our website at www.lasallehotels.com.

LASALLE HOTEL PROPERTIES Consolidated Statements of Operations (in thousands, except share data) (unaudited) For the three months ended For the six months ended June 30, June 30, Revenues: 2011 2010 2011 2010 Hotel operating revenues: Room $ 134,005 $ 108,002 $ 222,918 $ 175,678 Food and beverage 54,203 44,414 92,445 74,424 Other operating department 13,161 11,770 23,118 20,543 Total hotel operating revenues 201,369 164,186 338,481 270,645 Other income 1,181 1,520 2,419 3,225 Total revenues 202,550 165,706 340,900 273,870 Expenses: Hotel operating expenses: Room 30,631 24,275 55,973 43,336 Food and beverage 35,746 29,490 64,580 52,195 Other direct 5,466 5,128 9,842 8,944 Other indirect 48,111 38,824 88,054 70,883 Total hotel operating expenses 119,954 97,717 218,449 175,358 Depreciation and amortization 27,999 26,329 55,807 52,075 Real estate taxes, personal property taxes and insurance 8,786 8,383 17,271 16,423 Ground rent 2,033 1,432 3,376 2,835 General and administrative 3,928 3,931 8,734 7,586 Acquisition transaction costs 245 16 421 1,471 Other expenses 502 617 1,081 1,742 Total operating expenses 163,447 138,425 305,139 257,490 Operating income 39,103 27,281 35,761 16,380 Interest income 5 19 14 52 Interest expense (9,928 ) (8,724 ) (19,710 ) (17,498 ) Income (loss) before income tax expense and discontinued operations 29,180 18,576 16,065 (1,066 ) Income tax expense (5,069 ) (4,216 ) (2,545 ) (2,505 ) Income (loss) from continuing operations 24,111 14,360 13,520 (3,571 ) Discontinued operations: Income (loss) from operations of properties disposed of 44 273 (319 ) (1,457 ) Income tax (expense) benefit (18 ) 55 132 539 Net income (loss) from discontinued operations 26 328 (187 ) (918 ) Net income (loss) 24,137 14,688 13,333 (4,489 ) Redeemable noncontrolling interest in (income) loss of consolidated entity – (9 ) 2 19 Net income (loss) attributable to the Company 24,137 14,679 13,335 (4,470 ) Distributions to preferred shareholders (7,402 ) (6,688 ) (15,148 ) (13,377 ) Issuance costs of redeemed preferred shares – – (731 ) – Net income (loss) attributable to common shareholders <