WXH Winston Hotels

Winston Hotels, Inc. (NYSE: WXH), a real estate investment trust (REIT) that owns, acquires and develops hotels directly and through joint ventures, originates and acquires hotel loans and provides hotel development and asset management services to joint ventures in which it invests, announced today that it has commenced a public offering of 3,000,000 shares of common stock. Friedman, Billings, Ramsey & Co., Inc. is the sole book-runner of the offering and Raymond James & Associates, Inc. is acting as co-lead manager, with Robert W. Baird & Co. Incorporated and BB&T Capital Markets, a division of Scott & Stringfellow, Inc., acting as co-managers. The company intends to use the net proceeds from this offering to reduce borrowings under its line of credit and for general corporate purposes. The company has granted the underwriters an option, exercisable within 30 days after the pricing date, to purchase up to 450,000 additional shares of common stock to cover over-allotments, if any. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor will there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The offering of these securities will be made only by means of a prospectus, copies of which may be obtained from Friedman, Billings, Ramsey & Co., Inc., 1001 19th Street North, Arlington, Virginia 22209. About the Company The company currently owns or is invested in 52 hotel properties in 17 states having an aggregate of 7,055 rooms. This includes 44 wholly owned properties with an aggregate of 5,984 rooms and eight hotels in joint ventures totaling 1,071 rooms. The company's joint venture hotels include a 60% ownership interest in a joint venture that owns one hotel with 138 rooms, a 49% ownership interest in a joint venture that owns one hotel with 118 rooms, a 48.78% ownership interest in a joint venture that owns one hotel with 147 rooms, a 13.05% ownership interest in a joint venture that owns four hotels with an aggregate of 545 rooms and a 0.21% ownership interest in a joint venture that owns one hotel with 123 rooms, for which substantially all of the profit or loss generated by the joint venture is allocated to the company. As of June 30, 2006, the company also had approximately $59.7 million of outstanding loans in its loan portfolio that it originated or purchased. The company does not hold an ownership interest in any of the hotels for which it has provided financing. Notes About Forward-Looking Statements In addition to historical information, this press release contains forward-looking statements. The reader can identify these statements by use of words like "may," "will," "expect," "project," "anticipate," "estimate," "target," "believe," or "continue" or similar expressions, including without limitation its acquisition, disposition and development plans for hotel properties, its hotel lending plans, its dividend policy, and its estimated net income available to common shareholders, net income available to common shareholders per share, FFO available to common shareholders, FFO available to common shareholders per share and RevPAR. These statements represent the company's judgment and are subject to risks and uncertainties that could cause actual operating results to differ materially from those expressed or implied in the forward looking statements including, but not limited to, the failure of customary closing conditions, changes in general economic conditions, lower occupancy rates, lower average daily rates, acquisition risks, development risks including risk of construction delay, cost overruns, occupancy and governmental permits, zoning, the increase of development costs in connection with projects that are not pursued to completion, the risk of non-payment of subordinated loans, or the failure to make additional hotel debt investments and investments in hotels. Other risks are discussed in the company's filings with the Securities and Exchange Commission, including but not limited to its Annual Report on Form 10-K for the year ended December 31, 2005. For more information, call Patti Bell, Assistant Vice President of Administration & Investor Relations of Winston Hotels, Inc., at (919) 510-8003. For more information on Winston Hotels visit the Winston Hotels page at www.winstonhotels.com.