Earnings Before Interest Expense, Income Taxes, Depreciation and Amortization and other non-cash items (�EBITDA�) from continuing operations was $212 million for the 1999 third quarter, an increase of 45 percent over the pro forma EBITDA of $146 million in the 1998 third quarter. Year-to-date 1999 EBITDA of $694 million increased 34 percent over the year-to-date pro forma 1998 EBITDA of $519 million. The 1998 pro forma FFO per share and pro forma EBITDA reflect the company�s conversion to a real estate investment trust at the end of 1998 and a change in the reporting period for the company�s hotels not managed by Marriott International, Inc. (NYSE: MAR).

Growth in FFO and EBITDA was driven by an increase in room revenue per available room (�REVPAR�) of 2.8 percent and 3.8 percent for the company�s comparable hotels for the third quarter and year-to-date, respectively, as well as incremental hotel EBITDA from 1998 acquisitions. In 1998, the company made substantial investments in luxury hotels, including the acquisition of six Ritz-Carlton, two Four Seasons, one Grand Hyatt, three Hyatt Regency and four Swissotel properties. Had the results of these hotels been included in comparable results, the pro forma REVPAR increase for the company would have been 3.7 percent in the third quarter and 4.2 percent year-to-date.

Mr. Terence C. Golden, president and chief executive officer of Host Marriott Corporation, stated, �In our third quarter operating as a REIT, we were able to report 25 percent growth in FFO per share. We anticipate an even stronger fourth quarter.�

Mr. Golden noted, �Our focus during the quarter was on carefully using our capital to improve returns to our shareholders. Currently our primary use of free cash flow and asset sales proceeds is to repurchase stock under our stock buyback plan. Since initiating our stock buyback plan we have purchased the equivalent of nearly one million shares. We anticipate purchasing approximately $100 million of stock over the next six months.� Mr. Golden added, �Inflation fears and the Federal Open Market Committee�s recent position on interest rates have raised concerns that interest rates will be increasing. Through proactive refinancing activities, we have minimized the interest and refinancing risk to our company. As of today, we are in the fortunate position of having the interest rate on 94% of our debt fixed at below market rates with virtually no debt coming due over the next two years. Based on our current outstanding debt, a one percentage point increase in interest rates would have less than a $.01 impact on FFO per share.�

Mr. Robert E. Parsons, Jr., executive vice president and chief financial officer, stated, �During the third quarter of 1999, we continued to build on the solid financial foundation for our company. In August, we closed on a $100 million perpetual preferred stock offering. This transaction, in combination with the refinancing of our debt which was completed earlier this year, as well as the availability of $900 million under our $1.1 billion bank line of credit, contribute to the overall strength of our capital structure.�

Mr. Parsons added, �In the third quarter we also announced a stock repurchase program whereby the company can repurchase from time to time on the open market and/or in privately negotiated transactions up to 22 million shares of the Corporation�s outstanding shares of common stock or equivalent shares of convertible preferred securities. The stock repurchase program will generally be funded by the proceeds from asset sales, a portion of which will also be used to repay debt.�

Mr. Parsons continued, �During the fourth quarter we disposed of our Grand Hotel Resort and Golf Club (306 rooms) which was located in Point Clear, Alabama. This disposition continues our strategy of divesting non-core properties as market conditions permit. For 1999, we have completed asset sales of $77 million and, with the recent announcement to sell the Boston Ritz-Carlton, we expect total asset sales to approach $200 million by year- end.� The company reported third quarter and year-to-date 1999 rental income of $274 million and $885 million versus pro forma rental income of $193 million and $651 million for third quarter and year-to-date 1998, respectively. The company noted that year-to-date 1998 historical hotel revenues of $2.3 billion reflect the actual sales at the company�s hotels while year-to-date 1999 revenues represent rental income from leases, which are calculated from property-level sales.

Hotel sales for the third quarter of 1999 were $.9 billion, a 15 percent increase over the 1998 third quarter. Similarly, 1999 year-to-date hotel sales were $2.7 billion, reflecting a 17 percent increase from 1998 year-to-date hotel sales.  Net income available to common shareholders for the third quarter increased to $34 million, compared to a loss of $144 million in the third quarter of 1998. For the thirty-six weeks ended September 10, 1999, net income available to common shareholders increased to $153 million compared to a loss of $48 million for the same period in 1998. As a result of debt refinancings, the company has recorded a year-to-date extraordinary gain of $17 million in 1999 as compared to a year-to-date extraordinary loss of $148 million in 1998. Year-to-date net income for 1998 includes $8 million of income classified as discontinued operations, representing the company�s former senior living operations which were distributed to shareholders as part of Crestline Capital Corporation (NYSE: CLJ) at the end of 1998. Income from continuing operations in 1999 increased to $31 million and $137 million for the third quarter and year-to-date, respectively, compared to 1998 third quarter and year-to-date results of $2 million and $92 million, respectively.  Host Marriott is a lodging real estate company which currently owns or holds controlling interests in 123 upscale and luxury hotel properties primarily operated under the Marriott, Ritz-Carlton, Hyatt, Four Seasons and Swissotel brand names. For further information on Host Marriott Corporation, please visit the company�s website at www.hostmarriott.com.
 
 

This press release includes various references to FFO and EBITDA. The company considers EBITDA and FFO to be indicative measures of its operating performance due to the significance of its long-lived assets and because such data is considered useful by the investment community to better understand the company�s results, and can be used to measure its ability to service debt, fund capital expenditures and expand its 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.  Cash expenditures for various long-term assets, interest expense (for EBITDA purposes only) and income taxes have been, and will be, incurred which are not reflected in the EBITDA and FFO presentations. Although FFO and EBITDA are considered standard benchmarks utilized by the investment community, the company�s FFO and EBITDA may not be comparable to similarly titled measures reported by other companies.  Certain matters discussed in this press release are forward-looking statements within the meaning of federal securities regulations. All forward- looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual transactions, results, performance or achievements to be materially different from any future transactions, results, performance or achievements expressed or implied by such forward-looking statements. Future transactions, results, performance and achievements will be affected by general economic, business and financing conditions, competition and governmental actions.  The cautionary statements set forth in reports filed with the Securities and Exchange Commission contain important factors with respect to such forward-looking statements, including: (i) national and local economic and business conditions that will, among other things, affect demand for hotels and other properties and the availability and terms of financing; (ii) the ability to maintain the properties in a first-class manner (including meeting capital expenditure requirements); (iii) the ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; (iv) the ability to acquire or develop additional properties and risk that potential acquisitions or developments may not perform in accordance with expectations; (v) changes in travel patterns, taxes and government regulations; (vi) governmental approvals, actions and initiatives; (vii) the effects of tax legislative action; (viii) the effect on the company of the Year 2000 issues; and (ix) the ability of the company to satisfy complex rules in order to qualify for taxation as a REIT for federal income tax purposes and to operate effectively within the limitations imposed by these rules. Although the company believes the expectations reflected in such forward- looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained or that any deviations will not be material. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances.