REIT History at David Lerner Associates

Apple REITs are a series of real estate investment trusts underwritten by David Lerner Associates with the goal of providing income and possible capital appreciation for our clients.

Over $4.4 Billion and Approximately 87,000 Accounts in our Exclusive Real Estate Programs
David Lerner Associates has underwritten seven Apple REITs. The first, Apple Suites, merged with the second program, Apple Hospitality Two, in 2003. Apple Hospitality Two and Apple Hospitality Five were sold (see details below).

As of July 31, 2008, the remaining programs were made up of a total of 166 Hilton and Marriott hotels in 31 states with a total of 19,630 guestrooms.

Apple Hospitality Two
We are very pleased to announce that in May 2007, an afflilliate of ING Clarion purchased Apple Hospitality Two for a total consideration, including debt, of approximately $890 million at approximately $11.20 a share in cash.

Apple Hospitality Two investors received the following (assumes a fixed price of $10 per share on 4/24/01):

a) If distributions taken, average total annual return = 11.89%
b) If the distributions were reinvested into additional Apple Hospitality Two shares, average total annual return = 16.84%

Apple Hospitality Two consisted of 64 Marriott Residence Inns and Homewood Suites in the United States. Our clients invested $425 million in the program. Annual yields were:

2001 - 10%
2002 - 10%
2003 - 15%
2004 - 9%
2005 - 8%
2006 - 8.1%

The distribution rate was raised to 8.5%, retroactive to the third quarter of 2006. Annual yields assumed a purchase price of $10 per share.

(Apple Hospitality Two distributions include the February 2003 special distribution of 4.97% related to the company’s merger with Apple Suites). Distribution yield history does not reflect total return and does not take tax implications into account.

Apple Hospitality Five
We are also very pleased to announce that in October 2007, Inland American Real Estate Trust purchased Apple Hospitality Five for a total consideration including debt of approximately $677 million at $14.05 per share.

Apple Hospitality Five investors received the following (assumes a fixed price of $11 per share on 1/10/03):

a) If distributions received, average total annual return = 13.89%
b) If distributions reinvested into additional shares of Apple Hospitality Five, average total annual return = 18.33%

Apple Hospitality Five originally consisted of 28 Marriott and Hilton hotels United States. Our clients invested $500 million in the program. Annual yields were:

2003 - 8%
2004 - 8%
2005 - 8%
2006 - 8.16%

The distribution rate was raised to 8.3% on 6/15/06. Annual yields assumed a purchase price of $11 per share.

Distribution yield history does not reflect total return and does not take tax implications into account.

The returns shown above may not be indicative of the results experienced by other investors who may have purchased shares at different times and/or at a different price.

Apple REIT Six
Apple REIT Six consists of 68 extended-stay and select service hotels. Since inception, the program has yielded an 8% annual return. Our clients invested $1 billion in the program. On February 15, 2008, the distribution increased from 8% to 8.2%.

Apple REIT Six is no longer open to new investors. There is no public market for Apple REIT Six.

Apple REIT Seven
Apple REIT Seven consists of 50 extended-stay and select service hotels. Since inception, the program has yielded an 8% annual return. Our clients invested $1 billion in the program.

Apple REIT Seven is no longer open to new investors. There is no public market for Apple REIT Seven.

Apple REIT Eight
Apple REIT Eight consists of 46 extended-stay and select service hotels. Since inception, the program has yielded an 8% annual return. Our clients invested $1 billion in the program.

Apple REIT Eight is no longer open to new investors. There is no public market for Apple REIT Eight.

Apple REIT Nine
Apple REIT Nine, our current offering, will consist of extended-stay and select service hotels. The offering is by prospectus only. Please visit our "Contact Us" page to request a prospectus.

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Offering by prospectus only.
Disclosures: The yields cited above are computed by dividing the annual or annualized distributions by the share price. The REIT distributions consist of net income and a return of capital, primarily in the form of depreciation. The issuer cannot guarantee that investors will receive a specific return on their investment. The issuer may be unable to generate sufficient cash for distributions. Distribution history does not reflect total return and does not take tax implications into account.

There are conflicts or potential conflicts of interest with the issuer's chairman/president because he has duties as an officer and director to companies with which the issuer contracts or with which the issuer may compete for properties.

Properties may, at the issuer's Board of Directors discretion, be leveraged and thereby subject to a greater risk of default.

There could be significant adverse consequences of the issuer's failure to qualify as a REIT, including its inability to make distributions to shareholders.

Real Estate Investment Trusts (REITs) are subject to the normal risks associated with the ownership of real estate, including possible decline in value, environmental problems and changes in interest rates.

In addition, since the REITs we offer lack public markets (i.e. are illiquid), investors should be prepared to hold the investment for an indefinite period of time, although certain REITs (i.e. Apple REIT Six, Apple REIT Seven and Apple REIT Eight) may offer the possibility of limited, interim liquidity.

Click here for the Apple REIT Companies website.

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