Revenue per available room in the hospitality REIT's full portfolio, which includes the acquisition of three properties during third quarter, increased 10.7% to $76.82, up from $69.41 in the same quarter a year ago. On a "same-hotel" basis, RevPAR was up 5.3% to $72.73. This is based on a 5.3% increase in the "same-hotel" average daily rate to $96.40 and relative stabile occupancy of 75.5% in comparison with third quarter 2003.

The average daily rate for the full portfolio was up 11.8% to $103.52, and overall occupancy dropped 1% in comparison with the same quarter a year ago. According to Jay H. Shah, president and COO, "average daily rate was the primary driver of the RevPAR increase, in light of our aggressive strategy to move rate in our robust, high barrier to entry Northeastern markets."

The majority of the company's acquisitions during the past 12 months have been focused on new properties that are still in their ramp-up phase. Shah says he expects them to continue to stabilize and further enhance margins in 2005. Six of Hersha's 11 acquisitions in the past 12 months were purchased on opening and another three of those acquisitions has been in operation for less than year.

"These assets continue to show strong revenue stabilization trends," Shah says, "and we expect these acquisitions will continue to show margin improvement into 2005 as the assets further stabilize from revenue and operating expense standpoints." He adds that Hersha "will maintain adequate leverage capacity to complete additional asset acquisitions during 2005."

Meanwhile, for fourth quarter this year, the REIT has first right of refusal to acquire two New York City hotels: Hampton Inn-Manhattan Herald Square and Hilton Garden Inn at JFK International Airport. Their combined value is approximately $50 million.