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Holloway Lodging Real Estate Investment Trust (TSX: HLR.UN, HLR.DB, HLR.DB.A) ("Holloway" or the "REIT") announced today that the Toronto Stock Exchange (the "TSX") has approved the REIT's notice of intention to make a normal course issuer bid for up to 1,880,233 of its units, representing 10% of the REIT's public float as of December 18, 2008. During the period from December 11, 2007 to December 10, 2008, the REIT purchased 63,100 units under a prior normal course issuer bid. The weighted average price paid was $3.43 per unit.

Pursuant to the notice, the REIT may, over the 12 month period commencing on December 24, 2008 and ending on December 23, 2009 (or on such earlier date as the REIT completes its purchases pursuant to the bid or provides notice of cancellation), purchase units through the facilities of the TSX at prevailing market prices in accordance with the rules and policies of the TSX. All units purchased by the REIT under the normal course issuer bid will be cancelled. As of December 18, 2008, the REIT had a total of 38,802,716 trust units issued and outstanding. The average daily trading volume during the last six months ending on November 28, 2008 is 69,516.

Management of the REIT believes that, on occasion, trust units become available at prices that do not give full effect to their underlying value, based solely on management's opinion of the REIT's future prospects. Accordingly, management believes that the purchase of trust units pursuant to the normal course issuer bid represents an investment opportunity for Holloway and an appropriate use of its funds.

About Holloway

Holloway is a real estate investment trust focused on acquiring, owning and operating select and limited service lodging properties and a small complement of full service hotels primarily in secondary, tertiary and suburban markets and providing investors with stable distributions. Holloway currently owns 22 hotels with 2,423 rooms. Holloway's units and convertible debentures trade on the Toronto Stock Exchange under the symbols HLR.UN, HLR.DB and HLR.DB.A, respectively.

This press release contains forward-looking information within the meaning of applicable securities laws. Forward-looking information may relate to the REIT's future outlook and anticipated events or results and may include statements regarding the future financial position, property acquisition strategies and opportunities, business strategy, financial results and plans and objectives of the REIT. Particularly, statements regarding the REIT's future operating results, property acquisition strategies and opportunities and economic performance are forward-looking statements. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward looking-information is subject to certain factors, including risks and uncertainties, that could cause actual results to differ materially from what the REIT currently expects and there can be no assurance that such statements will prove to be accurate. Some of these risks and uncertainties are described under "Risk Factors" in Holloway's annual information form dated March 28, 2008 which is available at www.sedar.com. The REIT does not intend to update or revise any such forward-looking information should its assumptions and estimates change.

%SEDAR: 00023845E

SOURCE: HOLLOWAY LODGING REAL ESTATE INVESTMENT TRUST

Mr. Glenn Squires, Chief Executive Officer; Mr. Michael Jackson, President and Chief
Operating Officer; Ms. Tracy Sherren, Chief Financial Officer, (902) 404-3499

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