MDH Mhi Hospitality Corp. (MM)

WILLIAMSBURG, Va., Dec. 9 /PRNewswire-FirstCall/ -- MHI Hospitality Corporation (NASDAQ:MDH) announced today that in the interest of capital preservation within the current economic environment and upon the recommendation of senior management, the Company's board of directors has approved a change to its dividend policy. The Company intends to maintain its dividend distribution level at 100 percent of taxable income, consistent with maintaining its REIT status, which may result in a reduction in the level of dividend payouts going forward. Accordingly, management estimates that the annualized dividend payout for 2009 will be approximately $0.20 per share. The board of directors implemented this amendment after careful consideration and based on its expectation that the U.S. economy, and in particular the lodging industry, will continue to face declining operating trends through 2009. The Company cannot predict if, and when, it will amend its dividend policy in the future. About MHI Hospitality Corporation MHI Hospitality Corporation is a self-advised lodging REIT focused on the acquisition, redevelopment and management of mid-scale, upscale and upper-upscale full-service hotels in the Mid-Atlantic, Midwest and Southeastern United States. Currently, the Company's portfolio consists of nine properties comprising 2,113 rooms, all of which operate under the Hilton, InterContinental Hotels Group and Starwood Hotels and Resorts brands. In addition, the Company has a 25 percent interest in the Crowne Plaza Hollywood Beach Resort and a leasehold interest in the common area of Shell Island Resort, a resort condominium property. MHI Hospitality Corporation was organized in 2004 and is listed on the Russell Microcap(TM) Index. The Company is headquartered in Williamsburg, Virginia. For more information please visit http://www.mhihospitality.com/. Forward-Looking Statements This news release includes "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable, these statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict and many of which are beyond the Company's control. Therefore, actual outcomes and results may differ materially from what is expressed, forecasted or implied in such forward-looking statements. Factors which could have a material adverse effect on the Company's future results, performance and achievements, include, but are not limited to: national and local economic and business conditions, including the current economic downturn, that will affect occupancy rates at the Company's hotels and the demand for hotel products and services; risks associated with the hotel industry, including competition, increases in wages, energy costs and other operating costs; the availability and terms of financing and capital and the general volatility of the securities markets, specifically, the current credit crisis; risks associated with the level of the Company's indebtedness and its ability to meet covenants in its debt agreements; management and performance of the Company's hotels; risks associated with redevelopment and repositioning projects, including delays and cost overruns; supply and demand for hotel rooms in the Company's current and proposed market areas; the Company's ability to acquire additional properties and the risk that potential acquisitions may not perform in accordance with expectations; and legislative/regulatory changes, including changes to laws governing taxation of real estate investment trusts. These risks and uncertainties are described in greater detail under "Risk Factors" in the Company's Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission. The Company undertakes no obligation and does not intend to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Although we believe our current expectations to be based upon reasonable assumptions, we can give no assurance that our expectations will be attained or that actual results will not differ materially. DATASOURCE: MHI Hospitality Corporation CONTACT: Bill Zaiser, Chief Financial Officer of MHI Hospitality Corporation, +1-301-220-5400; or Vicki Baker, General Information of Financial Relations Board, +1-703-796-1798, for MHI Hospitality Corporation Web site: http://www.mhihospitality.com/

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