MeriStar Hotels & Resorts To Manage TwoPennsylvania Properties; Toftrees Resort and Conference...

WASHINGTON--(BUSINESS WIRE)--July 8, 1999--

MeriStar Hotels & Resorts (NYSE: MMH), the nation's largest independent hotel management company, today announced that it has signed agreements to manage the Toftrees Resort, Conference Center and Golf Club and a planned Hilton Garden Inn, both

The two hotels are owned by Federated-National, Inc., a hotel real estate development company with properties in Pennsylvania, Virginia, Maryland and North Carolina.

"These two transactions bring to 13 the number of new management contracts that we have added since the first of the year," said Paul W. Whetsell, MeriStar chairman and chief executive officer. "We continue to see substantial opportunities to add new management contracts and are aggressively pursuing them."

The 126-room Toftrees Resort and Conference Center is located within the Toftrees Planned Community with easy access to Interstates 80 and 99. The resort/conference center currently features six meeting rooms with 6,700 square feet of space. Federated-National plans to invest approximately $1 million to completely renovate all guest rooms and public areas. The property currently features two restaurants, four lighted tennis courts, a heated pool, fitness center and locker rooms, a par-course fitness trail, fully staffed golf and tennis shops and a concierge desk.

The 18-hole championship Toftrees Golf Club has been ranked as a "Four Star" course for the past five years by Golf Digest. Meetings and Convention magazine has rated the Toftrees Resort as one of the "Top 75 Golf Course Conference Center Resorts in the U.S.A."

Plans call for construction of the Hilton Garden Inn to begin soon with an anticipated 2001 opening. The 129-room property will be located adjacent to the Toftrees Resort and Conference Center. The Hilton Garden Inn will feature a full-service restaurant, approximately 1,600 square feet of meeting space, an indoor swimming pool with whirlpool, a fitness center and a business services center.

"These two contracts demonstrate MeriStar's ability to manage a wide array of property types, including upscale resorts, upper mid-market hotels, conference centers and golf courses," said David McCaslin, MeriStar president. "Our size and distribution also are an advantage--we expect to achieve significant operating leverage, not only between these two properties but with our four other hotels in the region. We also see this as an opportunity to build on our relationship with Penn State's well regarded School of Hotel Management and Golf Course Turfgrass Management programs."

MeriStar Hotels & Resorts leases or manages 217 hotels with 45,439 rooms in 34 states, the District of Columbia, Canada and the U.S. Virgin Islands. For more information about MeriStar Hotels & Resorts, Inc., visit the company's web site: www.meristar.com.

The matters in this press release include "forward looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are qualified by cautionary statements contained herein and in MeriStar Hotels & Resorts' filings with the Securities and Exchange Commission.