Interstate to Manage Russia's First Hilton

. October 14, 2008

OCTOBER 10, 2006. Interstate Hotels & Resorts (NYSE:IHR) today announced that it has signed a long-term contract with JSC Sadko Hotel to manage the landmark, 275-room Hilton Moscow Leningradskaya in Moscow, Russia. It is the fourth property that the company manages in Moscow and the sixth hotel Interstate has under management agreement in Europe.

The property, the first hotel to carry the Hilton brand in Russia, currently is closed undergoing a major refurbishment and will re-open in mid- 2007. The Hilton Moscow Leningradskaya is one of seven famous 'Stalin' towers that visually define the Moscow skyline. Originally constructed in 1954, the Hilton Moscow Leningradskaya will retain many of its historic architectural features as part of the refurbishment.

"This will be a magnificent hotel when completely renovated, and we expect it to rapidly become a market leader," said Henry L. (Hank) Ciaffone, president of international operations and development at Interstate. "We have global expertise and a growing portfolio in Europe, including the recent signing of our first property in Ireland and the soon-to-open Marriott Ghent in Belgium. With our previous experience managing three properties in Moscow, we have first-hand knowledge of this market most operators cannot match. Combined with our strength in North America, we believe we can deliver superior returns for our owner through our economies of scale, marketing expertise and proprietary operating programs. We are aggressively seeking additional growth opportunities in Europe for both branded and independent hotels."

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