Ashford Acquires Mezzanine Loans

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. October 14, 2008

JANUAEY 4, 2007. Ashford Hospitality Trust, Inc. (NYSE: AHT) today announced it has closed on two junior mezzanine loans totaling $11.0 million that are secured by interests in the Hilton Suites Galleria in Dallas and the Wyndham Dallas North. The hotels were recently acquired by an affiliate of American Property Management Company (APMC), which have assumed management of the properties.

The $7.0 million loan on the Hilton Suites Galleria bears interest at a rate of LIBOR plus 650 basis points for a term of three years with two one-year extension options. The loan is interest only and locked from prepayment for the first 18 months. The loan structure also includes a $2.2 million interest reserve. Financing on the Hilton Suites Galleria includes a $32.0 million first mortgage loan originated by Countrywide Commercial Real Estate Finance and the $7.0 million junior mezzanine loan. Ashford will receive an origination fee of 0.75%. The first year unleveraged yield on the loan is expected to be 11.9%. Based on trailing 12-month net cash flow from the property, the debt service coverage ratio at closing is approximately 0.9x. Ashford's investment in the capital structure is approximately 55% to 64% loan to value with the last loaned dollar at $151,163 per key, which is well below replacement cost. The Hilton Suites Galleria opened in 2003 and has 258 suites and 5,800 square feet of meeting space. The hotel is located in the heart of the upscale Galleria sub-market in Dallas adjacent to the Galleria Mall. The property is expected to be converted to a Le Meridian in 2007 after an $8.5 million renovation.

The $4.0 million loan on the Wyndham Dallas North bears interest at a rate of LIBOR plus 575 basis points for a term of three years with two one-year extension options. The loan is interest only and locked from prepayment for the first 18 months. The loan structure also includes a $200,000 interest reserve. Financing on the Wyndham Dallas North includes an $18.4 million loan originated by Countrywide Commercial Real Estate Finance and the $4.0 million junior mezzanine loan. Ashford will receive an origination fee of 0.25%. The first year unleveraged yield on the loan is expected to be 11.1%. Based on trailing 12-month net cash flow from the property, the debt service coverage ratio at closing is approximately 0.8x. Ashford's investment in the capital structure is approximately 60% to 65% loan to value with a last loaned dollar of $72,097 per key, which is well below replacement cost. The Wyndham Dallas North opened in 1979 and has 310 rooms and 14,000 square feet of meeting space. Located at the northwest corner of I-635 and the North Dallas Tollway in the Galleria sub-market in Dallas, the hotel is expected to be converted to a Sheraton in 2007 after a $5 million renovation.

Commenting on the announcement, Monty J. Bennett, President and CEO of Ashford Hospitality Trust, stated, "We continue to remain selective and disciplined in our mezzanine investment strategy. Our extensive knowledge of the Dallas Galleria market, familiarity with the borrower, and relationship with Countrywide enabled us to move rapidly on this transaction. With the capital expenditures and brand conversions, we anticipate the debt service coverage to improve substantially. These loans are another example of our ability to work with both borrowers and lenders to source attractive new opportunities."