MCLEAN, VA, January 13, 2003 � Highland Hospitality Corporation (NYSE:HIH) announced today that it has acquired the 158-room Hilton Garden Inn BWI Airport hotel for a purchase price of $21.9 million, plus customary closing adjustments.  Highland purchased the asset from LTD Management Company, a private hospitality firm based in Chesapeake, Virginia.  Crestline Hotels & Resorts, Inc., a leading hotel management company, will

Hilton Garden Inn BWI Airport   1516 Aero Drive Linthicum, MD 21090

James L. Francis, President and CEO, stated, �The Hilton Garden Inn BWI Airport hotel is the seventh hotel Highland has acquired.  The acquisition of this hotel fits our strategy to invest in upscale full-service and premium limited-service and extended stay hotels in major urban, airport and suburban markets.  With the expansion and subsequent growth potential of the Baltimore/Washington International Airport, this hotel should be well-positioned to generate increasing returns and long-term value appreciation.�

With the acquisition of the Hilton Garden Inn BWI Airport property, the Company now owns seven hotel properties with an aggregate of 1,725 rooms in five states. 

The 158-room Hilton Garden Inn BWI Airport hotel opened in June 2001 and is located within two miles of the Baltimore/Washington International Airport and within eight miles of Baltimore�s Inner Harbor area.  The hotel contains over 2,000 square feet of meeting space and provides such amenities as complimentary high-speed internet access, a pool and fitness room and airport shuttle transportation.  In addition to the airport, other demand generators within the airport submarket include such companies as Northrop Grumman, Kodak, MCI, All Meade, and the National Security Agency. 
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. 

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.