MHI Hospitality Corporation, a self-advised real estate investment trust (REIT), formed in August 2004. As of March 20, 2009, our portfolio consists of nine full-service upper up-scale and mid-scale hotels with 2,113 rooms. These nine hotels operate under well-known brands such as Hilton, Crowne Plaza, Sheraton and Holiday Inn. The company owns approximately 65.0% of the partnership units in its operating partnership. Limited partners own the remaining units. We also own a 25.0% minority interest in a Crowne Plaza hotel through a joint venture as well as leasehold interests in the commercial spaces of the Shell Island Resort, a condominium resort property.

Our strategy is to enhance stockholder value by pursuing attractive lodging investments, whereby we can achieve superior risk-adjusted returns. Our core "turnaround" growth strategy involves purchasing, renovating and up-branding under-performing, full-service hotels. We believe that under-performing hotels that are poorly managed, that suffer from significant deferred maintenance and capital improvement, and that are not properly positioned in their respective markets can be acquired at attractive prices well below the cost of new construction or performing hotels. By acquiring such properties, we believe we can create significant value and superior, risk-adjusted returns.

In order for MHI to qualify as a REIT, it cannot operate its hotels; therefore the properties are leased to MHI Hospitality TRS, LLC which in turn has engaged MHI Hotels Services, LLC, an eligible independent management company, to manage the hotels.