Good day and welcome to the Hospitality Properties Trust First Quarter 2008 Financial Results Conference Call. This call is being recorded. At this time for opening remarks and introduction I would like to turn the call over to the Manager of Investor Relation, Mr. Tim Bonang. Please go ahead Sir.

Thank you, and good afternoon everyone. Joining me on today's call are John Murray, President and Mark Kleifges, Chief Financial Officer. John and Mark will make a short presentation which will be followed by a question-and-answer session. Before we begin today's call I would like to read our Safe Harbor Statement. Today's conference call contains forward-looking statements within the meaning of Private Securities Litigation Reform Act of 1995 and Federal Securities Laws. These forward-looking statements are based on HPT's present beliefs and expectations as of today, May 6th, 2008. The company undertakes no obligation to revise or publicly release the results of any revision to the forward-looking statements made in today's conference call other than its filings with the Securities and Exchange Commission regarding this reporting period. In addition this call may contain non-GAAP numbers including funds from operations or FFO. Reconciliation of FFO and net income is available on our supplemental package found in the Investor Relation's section of our website. Actual results may differ materially from those projected in forward-looking statements. Additional information concerning factors that could cause those differences is contained in our Form 10-K filed with the SEC and our Q1 supplemental, operating and financial data found on our website at www.hptreit.com. Investors are cautioned not to place undue reliance upon any forward-looking statements. And with that, I would like to turn the call over to John Murray.

Thank you, Tim. Good afternoon and welcome to our first quarter 2008 earnings call. Earlier today HPT reported FFO per share for the quarter of $1.18. This represents quarter-over-quarter FFO per share growth of approximately 9%. First quarter RevPAR growth averaged 2.3% across our 291 hotels. RevPAR growth at HPT's hotels exceeded industry average driven by rate increases which rose 3.7% and offset of 1.3% percentage point drop in average occupancy. RevPAR growth is aided by continued impressive improvement at our Hyatt Place hotels and strong performance at our Staybridge Suites hotel. Balancing these results was declining performance at our 18 Residence Inn portfolio and 76 Candlewood hotels. As the economy has continued to weaken, we have seen reduced trading related extend of stay demand in some markets. Several Residence Inns including our downtown Chicago hotel were also being renovated during the quarter. Overall we are pleased that our portfolio is continued to achieve above average rate gains without materially sacrificing occupancyamount slowdown on Easter holiday. As I have said before, in large part this performance reflects our strong locations, strong brands, well maintained assets and quality management. Further evidence of this can be seen at the local market level and the average RevPAR index for HPT's hotels which has increased 270 basis points for the first quarter of 2008 to over a 119. RevPAR performance this quarter improved in most regions with the strongest regional performance seen at our hotels in Canada and east south central region driven largely by strong results at our six national area hotels. Balancing these strong results was Mid-Atlantic and West North Central regions which felt the impact of reduced demand in the suburban New Jersey and Philadelphia markets and Minneapolis and Kansas City suburbs respectively. The strongest portfolio performance came from the Hyatt…

Thanks, John. During the first quarter, performance of our leased hotel portfolios declined versus last year with RevPAR basically flat, profit margins down 150 basis points and a 4.9% decrease in cash flow available to pay rent. RevPAR and operating profit margins at our leased hotels for the quarter were negatively affected by our Residence Inn portfolio, which had three of its 18 hotels under renovation and experienced lower occupancy at several other hotels. For the last 12 months, rent coverage ratios for our leased hotel portfolios range from 0.76 times for our Kauai Marriott hotel to 1.62 times for our Courtyard portfolio. First quarter performance was stronger at our managed hotel portfolios, with RevPAR up with 3.6% and a 73 basis point increase in profit margins. Cash flow available to pay our minimum returns increased by 6.9% for the quarter, with increases of 13% and 18% for our Staybridge and IHG number three portfolios respectively For the last twelve months, return coverage ratios for our managed hotel portfolios range from 0.7 times for our Hyatt portfolio to 1.66 times for our Carlson portfolio. As John mentioned earlier, our Hyatt Place portfolio continues to generate strong top-line growth and was able achieve positive coverage of minimum returns this quarter, more quickly than we expected. Rent coverage for our travel center portfolios for the twelve months ended December 31, 2007 were 1.26 times for the TA portfolio and 1.08 times for the Petro portfolio. We calculate coverage for our travel center portfolios consistent with our hotel portfolios. Property level revenues less property level expenses divided by the rent due us. For the 2007 year, performance of our 182 comparable travel centers was weak with fewer gross margin and volumes down 10.5% and 4.2% respectively. Non-fuel revenues and gross margin were both…

Thank you. [Operator Instructions]. And our first question is from William Truelove of UBS. Please proceed with your question.

Hi guys. I got a couple of questions. The first one, on the $42 million purchase in the quarter, you said that was a ground lease, where will the P&L impact happen? Which line item are we reducing in expense or what? It wasn't really income from TA.

In our income statement Will, it will simply result in additional rental income.

Okay.

No other impact on our income statement. Other than obviously the cost of borrowing under our revolver to fund it.

Yes. Okay. All right, good to know. And then, second one, here's sort of a complicated question I guess on one you're going to love, on travel centers, can you talk about ways in which or scenarios in which HPT may be lending money to TA in order to help TA end up paying the rent, we get tons of questions about trying to figure out scenarios where you are lending money to TA and they turn around and then pay up and how they could build up over time. Can you talk about what scenarios those are and sort of your thoughts about that happening? Thanks.

I am not sure what's out there in the market place but we are two publicly traded companies and if we were lending money or if TA was borrowing money I think we probably both need to disclose that and furthermore if we are lending money to TA so that they could pay the rent, I am not sure that we could recognize income for that so I guess my short answer is its not happening. So I can't really describe it any further than just to say it's not happening and we have no expectation that it will.

Right thanks for the clarity.

Thank you, our next question is from Jeff Donnelly of Wachovia. Please proceed with your question.

Good afternoon guys.

Hey, Jeff.

John, I guess I am interested maybe as a follow up to Will's question is to note that just to hear about what you think TA's other initiatives are because maybe there's a little involved but that unit volumes of trucking among the major generators of trucking traffic like vehicle fails, [ph home building buying future inventory continue to be down, I think 10-20% year-over-year and that's persisted since the end of the first quarter and I guess it's a way of saying that I would expect that the cash burn that we saw at TA in Q4 will continue in Q1 as you guys had suggested but it could accelerate beyond that and I guess I am curious beyond the cost cutting actions they've taken, what sort of solution do you guys think that there could be other to overcome similar trends.

ell I I guess I would start off by saying I expected they're going to... I know that they are working hard to make sure that the changes that they have already announced are implemented quickly and are felt throughout the organization and that they are going to be watching as closely as everybody else, more closely than anybody else to make sure... to see if they are having the desired effect or not and... but in terms of other things that they could do, I think probably the best people to answer that is the folks at TA because we don't actually manage the properties but I can tell you that for instance every single one of the TravelCenter sites and Petro site is a 24 hour-a-day, 365 day-a-year business in every single one of its business units. So no matter what time a day you show up with any given TravelCenter site, there will be... therefore trucks service base there... there will be mechanics and all those service base, if there is for a fast food well quick service restaurants, there will be a manager and staff at each one of those, there will be a management team and staff at the sit-down restaurant, there will be people in the convenient store and there will be people overseeing the few [indiscernible] and I may even be missing some people, I am not sure but I think that if just like you see in... after 9/11 when there was a down-turn and you saw a brand standards become relaxed in the hotels and concierge lounge be replaced by coupons for discount at breakfast and the number of people concierge desk or doorman or things be reduced, I think that TA could also take steps like that where they could maybe only operate one or two of rather than four fast food restaurants or may be at certain times of the day only operate the quick serve restaurant and not the sit-down restaurant or vice-versa and that maybe at certain hours of the day they could keep a mechanic in the truck service area to take care of emergencies but not necessary have full staffing 24 hours a day. So, I think there are a lot of initiatives like that, I don't know which ones will are for the biggest bank for the buck and I don't know that there may not be other steps that TA feels that they could take in addition to or even maybe before some of the things that I've discussed. I think they going to have an earnings call next week. So, you could ask them if you, that probably be a better question for them.

I'll probably will and what you are alluding to is, maybe your head count changes beyond but they have already announced this far, potentially.

That's correct.

And then I am curious Mark --

We are just modifying the number of hours; there is a lot of hourly employing in some of these locations.

It makes sense. Mark I am curious that just on that the $25 million payment of TA, where did that chop in the financial. Will that just flow through the assets?

Yes.

And on the capital expenditures I think you guys mentioned that they've ceased making discretionary CapEx investments there. Do you guys know how much they spend or how much you contribute to them, I guess year-to-date or would you anticipate they would spend in full year 2008, per CapEx on the TravelCenters?

I don't know Jeff of hand with their numbers. They did... I just don't recall, they did give some guidance on that on their call, I just don't recall the number. In terms of our commitment to fund though, we funded, we are committed to fund $25 million each lease year. We made the first payment installment in 2007 and then as we mentioned in our prepared comments, we made the second lease year installment of $25 million in April.

And I'm curious for your sales for HPT. What is your total capital expenditure budget in 2008? Are you able to break that down between what you guys will fund and what collectively your managers will fund.

Yes. We think that for the remainder of this year that on the hotel side, we probably have another $70 million to $90 million and I would think that we will... we will fund above the FF&E reserves between $45 million and $65 million of that total.

And just a last question, actually I think is for John. I think you attended a conference earlier this year where you were saying I guess three to four portfolios out there in the market, roughly say a dozen to two dozen hotels. Any update on transactions opportunity out there in the market and where pricing is sorting [ph] out?

Yes. I guess take the last part of that first. I don't think the pricing is sorting itself out yet and all four of those portfolios as far as I can tell are still on the market. There is other portfolios that are out there. The bulk is on some of the... some of those four portfolios are responding... I don't want to say that they... that this... every now and then I get e-mails on... regarding follow-up... that almost sound like that there may be some desperation, because there's not only do they own hotels but they are seeking to sell that. They are also developing hotels and so I think for some of the smaller operators, as the capital markets remain challenging they are having a tougher time financing their ongoing business. There may be more that come to market in the near term. But, any way we are not comfortable that we really sort of felt the bottom in terms of where our pricing is going to settle out and so we are still taking a wait and see approach to what's out there.

Anddo you think probably Cap rates have dropped at least 100 basis points?

Well I mean that's come up at least 100 basis points and in some areas may be a couple of 100 basis points. But, we don't want to... we don't want to get in too early. I don't see us missing opportunities. There has been very little transaction flow. So I think we are better off waiting to see how things shake up.

Thanks. That's helpful.

Thank you. [Operator Instructions]. And our next question comes from Mark Robert of Roberts & Company [ph]. Please proceed with your question. Mark Roberts - Roberts & Company: Can you give us a sense on the increase in or decrease in occupancy in the various hotels? Are you starting to see the weakness more in the higher end business class hotels or more in some of the lower priced long-term residents and some that are used for travelers?

I think in this... in this quarter we probably... we have a big portfolio and its very geographically diverse, so its been a little bit of a mix, but this quarter for sure it seemed to affect our Residence Innsand Candlewood hotels more so than some of our other portfolios, and particularly in those that the shortest tier occupancy seem to be okay and the longest tier occupancy seem to be okay, but sort of that, one week to three week, the sort of seven to 30 day occupancy seem to be the more challenging for our Candlewoods and Residence Inns, which we attribute to reduced training business mostly. Mark Roberts - Roberts & Company: Okay. So from your standpoint you wouldn't feel confident saying that there is a decline in business travel or a specific decline in vacation type travel. You are seeing it more in specific geographic and types of occupancies.

I think what, we mostly have business hotels. We do... we have some that are focused on leisure travelers like in Kauai and our InterContinental and Juan which is... has a mix. But, we are mostly business hotel say to the extent that they receive tips in occupancy that's business related. Mark Roberts - Roberts & Company: Okay. Thank you.

By and large.

Okay. Thank you. Our next question is from William Truelove. Please proceed with your question.

Just one follows-up. In terms of... can you break down where by the portfolio type the additional rent that was earned beyond the minimum?

Sure, I'll give you the large... I'll give you the larger components. The Candlewood portfolio, our IHT number 2, $1.428 million, the Carlson portfolio, $1.65 million and those were both additional returns and then under our Courtyard Marriott number 1 portfolio we earned $988,000 of percentage rent for the quarter.

Alright, thanks so much.

Yes.

Thank you and our next question is from Celeste Brown of Morgan Stanley, please proceed with your question.

Hi guys, just to talk about the seasonality this year of the additional returns, should be similar to last year or of course thinking about lodging is lagging maybe up, maybe sort of trail-off as the year goes on?

You know, that's a tough one to answer Celeste. We obviously... we have a leading indicator in the TravelCenters and that's been pretty weak and we have been watching the results at our hotels and the pace has been declining but its still... we are still seeing some decent growth. I think relative to the industry as a whole and our operators... they are cautiously optimistic and they seem to be holding onto a belief that the second half is going to be a little bit stronger than the first half. So we are... I guess we are continuing to expect to see growth and to see it at way that probably more towards the third quarter... the fourth quarter is always one of the weaker quarters, the second quarter is I think its going to be somewhat, we'll see it right now.

Okay, thank you.

Thank you. There are no further questions. I'd like to turn the call back over to Mr. John Murray.

Thank you all very much for joining us today. I'll remind you that we're going to be presenting at the Nary [ph] Institutional Investor Conference in June and we look forward to hopefully seeing you there. Thank you.

Thank you. This concludes the conference call. Thank you everyone for joining. You may now disconnect.