Hersha Hospitality Trust Announces Dividends; Modifies Common Dividend Policy

Hersha Hospitality Trust (NYSE: HT), owner of select service and upscale hotels in major metropolitan markets, today announced that its Board of Trustees declared a cash dividend of $0.50 per Series A Preferred Share for the second quarter ending June 30, 2009. The preferred share dividend is payable July 15, 2009 to holders of record as of July 1, 2009.

The Board of Trustees also declared quarterly cash dividends of $0.05 per Common Share and per Limited Partnership unit for the second quarter ending June 30, 2009. The common share dividend and limited partnership unit distribution are payable on July 15, 2009 to shareholders and unitholders of record on June 30, 2009.

Ashish Parikh, Hersha�s Chief Financial Officer, stated, �The decision by our Board to reduce the dividend is in response to, and comes after thorough analysis of, the difficult and unprecedented operating environment in the lodging industry, coupled with capital markets that remain constrained. This decision was considered at length because of the Company�s ten year track record of never having cut our dividend since our initial public offering in 1999.�

�The Company believes the reduction to be prudent and in the best interest of shareholders at this time to preserve liquidity and maintain financial flexibility given the continued lack of visibility on the length and severity of the current economic downturn. As fundamentals improve and the markets stabilize our Board is committed to re-evaluating the dividend each quarter. The dividend policy should result in cash preservation for the Company of approximately $30 million over the next twelve months, which will further strengthen our liquidity and balance sheet position,� concluded, Mr. Parikh.

The new dividend rate on common shares represents an annualized yield of 5.6% based on the closing price of Hersha�s stock on May 6, 2009.

Future distributions, if any, will be at the discretion of the Company�s Board of Trustees and will depend on the Company�s actual cash flow, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Internal Revenue Code and such other factors as we may deem relevant. The Company�s ability to make distributions will depend on its receipt of distributions from its operating partnership and lease payments from our lessees with respect to the hotels. The Company relies on the profitability and cashflows of its hotels to generate sufficient cash flow for distributions.

About Hersha Hospitality Trust

Hersha Hospitality Trust is a self-advised real estate investment trust, which owns interests in 77 hotels, totaling 9,707 rooms, primarily along the Northeast Corridor from Boston to Washington D.C. The Company also owns hotels in Northern California and Scottsdale, Arizona. Hersha focuses on high quality, upscale hotels in high barrier to entry markets. More information on the Company and its portfolio of hotels is available on Hersha's Web site at http://www.hersha.com.

Forward Looking Statement

Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. For a description of these factors, please review the information under the heading �Risk Factors� included in our Annual Report on Form 10-K for the year ended December 31, 2008, filed with the Securities Exchange Commission.

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