The Company has also completed a review of its fourth quarter estimates and expects its earnings per share to be approximately $.02 to $.03 lower than its prior estimate of $.27 per share. The Company cited the impact in the quarter of repositioning its HomeGate hotels to Wellesley Inn Suites, softening conditions in certain markets and concerns over December bookings related to Y2K as the principal reasons for the revision.  A.F. Petrocelli, Prime Hospitality Corp.�s Chairman, President and CEO stated, �Although we believe that REVPAR growth at our hotels will continue to outpace the industry, we are continuing to see slower revenue growth than was previously expected.�

The Company continues to move forward with its plans to reposition its extended-stay HomeGate Studios and Suites to its limited-service Wellesley Inn and Suites. The repositioning and reflagging affects 38 of its 43 HomeGates and is expected to be complete by November 1, 1999. The Company believes that the re-marketing of these hotels as transient hotels under a new brand name along with the related renovation activity will slow the occupancy at these properties during the fourth quarter. The Company also believes that increased supply in the Southwest and Southeast regions, specifically in Arizona, Texas, Florida and North Carolina, will slow revenue growth at these and other Prime hotels.

Mr. Petrocelli stated, �We are committed to the repositioning of the HomeGate hotels to our Wellesley Inn Suites brand and believe that the benefits from this conversion will be realized during the year 2000.� Prime also announced that it has completed the sale of its Austin/Arboretum AmeriSuites hotel for $10.5 million to Austin Suites LLC, a subsidiary of Lane Hospitality, based in Northbrook, IL. The hotel will be operated as an AmeriSuites franchise and managed by Lane Hospitality.

�This sale represents our eighth hotel disposition this year and reflects our ongoing strategic initiative to divest of hotel real estate.� said Mr. Petrocelli. �We intend to continue to implement our plan of repurchasing shares and retiring debt with proceeds from asset sales.� To date, Prime has repurchased approximately 3.4 million shares of its stock and has approximately $17 million of availability under its bank covenants to further repurchase its shares. Prime is currently under negotiation to sell additional hotels during the year and recently announced it has signed a contract to sell its Frenchman�s Reef Resort Hotel in St. Thomas, USVI to Marriott International, Inc. 

Prime Hospitality Corp., one of the nation�s premier lodging companies, is an owner, manager and franchisor of over 200 hotels throughout the United States and the U.S. Virgin Islands. The company operates three proprietary brands, AmeriSuites (all-suites), HomeGate Studios and Suites (extended-stay) and Wellesley Inns (limited-service). The Company previously announced that effective November 1, 1999, it will merge its Wellesley and HomeGate chains into the new Wellesley Inn Suites chain. Also within Prime�s portfolio are owned/or managed hotels operated under franchise agreements with national chains including Hilton, Sheraton, Radisson, Marriott, Holiday Inn, Ramada and Howard Johnson.

No assurance can be given that earnings will not be lower than management currently anticipates. Statements in this press release, other than statements of historical information, include forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward looking statements involve known and unknown risks which may cause the Company�s actual results in future periods to differ materially from expected results. These risks are described in the Company�s filings with the Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company.