MHI Hospitality Corporation Prices Initial Public Offering WILLIAMSBURG, Va., Dec. 17 /PRNewswire-FirstCall/ -- MHI Hospitality Corporation (AMEX:MDH) announced today its initial public offering of 6,000,000 shares of common stock at a price to the public of $10.00. MHI Hospitality also granted the underwriters an option to purchase up to additional 900,000 shares of common stock to cover over-allotments, if any. The shares began trading today on the American Stock Exchange under the symbol "MDH". The offering is expected to close on December 21, 2004. Proceeds from the offering will be used to repay a portion of the existing debt, as well as to acquire and renovate hotel properties. The sole book-running manager for the offering is BB&T Capital Markets. Ferris Baker, Watts, Hilliard Lyons and Flagstone Securities are acting as co- managers for the offering. The Securities and Exchange Commission has declared a registration statement relating to these securities effective. Copies of the prospectus relating to this offering may be obtained from the syndicate department of BB&T Capital Markets a Division of Scott & Stringfellow, Inc., Syndicate Department, 909 East Main Street, Richmond, VA 23219 (Tel.: 804-780-3267). This press release shall not constitute an offer of securities for sale, or a solicitation of an offer to buy securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the securities laws of any such state or jurisdiction. Forward-Looking Statements This presentation 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. For a further discussion of the factors that could affect outcomes, please refer to the "Risk Factors" section of the prospectus. DATASOURCE: MHI Hospitality Corporation CONTACT: Bill Zaiser, Chief Financial Officer of MHI Hospitality Corporation, +1-301-474-3307; or General Information, Georganne Palffy of Financial Relations Board, +1-312-640-6768

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