The three separate agreements--two of which are with developers related to the REIT--are expected to close this quarter. The Philadelphia asset is an 80% joint venture with Affordable Hospitality Associates, one of the developers related to Hersha.

Metro JFK Associates LLC, also a Hersha-related developer, completed the 188-room Hilton Garden Inn at JFK Airport in February 2005. The developer participated in Hersha's development loan financing program, which, in turn for development financing, provides Hersha with a first right of refusal to acquire the finished asset.

This month Metro JFK repaid a loan extended by Hersha for development of this property. Jay H. Shah, Hersha's CEO, calls the acquisition of Hilton Garden Inn at JFK "a prime example of the benefits derived from our development loan financing program. It complements our strategy of building a portfolio of newer hotel properties in high-barrier to entry Northeast corridor markets that we believe can benefit from growth in RevPAR over the next few years." The property at JFK is also easily accessible to LaGuardia Airport and New York City.

The 96-room Tyson's Corner Residence Inn is within easy access of Reagan National and Dulles International airports and the Washington, DC area. Vienna is one of Northern Virginia's fastest growing corporate markets, according to Shah, and in transportation hubs that facilitate travelers' access to the Capital District.

Hersha's 80% equity interest in the 250-room Hampton Inn Philadelphia carries a 9% participating preferred return on the asset. It was built in 2001 and is adjacent to the Pennsylvania Convention Center, which is beginning an expansion plan. "As with our other hotel joint ventures, the Hampton Inn transaction has the potential to create solid value through a preferred return, while also participating in the performance of the hotel," Shah says.

Hersha is footing the bill for these acquisitions with a combination of cash, mortgage debt and operating partnership units to be determined at the closing of the transactions. The price for the Tyson's Corner asset includes assumption of a $9.6-million mortgage, and the price for the JFK asset includes assumption of a $13-million mortgage balance. The Hersha portfolio includes ownership interests in 50 properties with an aggregate of 5,852 rooms located primarily from Boston to Washington, DC.