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                                                                   Exhibit 99.2

Item 2. Acquisition or Disposition of Assets

Property Acquisition in Missouri

     On June 15, 2001, we caused a new and wholly-owned subsidiary to acquire
the Chesterfield Homewood Suites(R) by Hilton near St. Louis, Missouri for a
base purchase price of $11.5 million. The hotel is located on a 4.3 acre site at
840 Chesterfield Parkway West, Chesterfield, MO 63017. The hotel is
approximately 20 miles from the center of downtown St. Louis and the Lambert St.
Louis International Airport.

     The Missouri hotel opened in March 2000. It consists of one building with
three floors and contains a total of 145 suites, which have a combined rentable
area of 88,848 square feet. The following types of suites are available:

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     Type of Suite             Number Available        Square Feet/per Suite
     -------------             ----------------        ---------------------

     King Suite                        123                    600
     Double Suite                       17                    624
     Two-Bedroom Suite                   5                    888

The Missouri hotel offers a 40-seat breakfast/lounge area, two meeting rooms
that accommodate 12 people and 20 to 25 people, and a business center that
offers guests the use of a personal computer, printer and photocopier.
Recreational facilities include an outdoor pool and an exercise room. The hotel
also contains a guest convenience store and laundry facility. The hotel has its
own parking lot with approximately 160 spaces. The hotel provides complimentary
shuttle service within a five-mile radius.

We believe that the Missouri hotel has been well maintained and is generally in
very good condition. Over the next 12 months, we plan to spend approximately
$200,000 on renovations or improvements. We expect that the principal
renovations and improvements will include minor room renovations and additional
exterior signage.

During 2001 (through the end of May), approximately 51% of the guests have
stayed for five nights or more. In general, occupancy at the Missouri hotel is
not significantly affected by seasonal variations. The following table shows
average daily occupancy rates since the opening of the hotel:

                  Average Daily Occupancy Rate (calendar year)


                                                 2001
                          2000              (through May)
                          ----              -------------

                         66.0%                 63.9%

During 2001 (through the end of May), the average daily rate per suite has been
$86.83, and the average daily net revenue per suite has been $55.45. The hotel's
current rate structure is based on length of stay and type of suite, as
summarized below:

 Length of Stay

(number of nights)           King               Double       Two Bedroom
-------------------          ----               ------       -----------

1 to 4                       $109                $119           $189
5 to 13                        99                 109            179
14 to 29                       89                  99            169
30 or more                     69                  79            159

The Missouri hotel offers a weekend discount. This discount varies by type of
suite and generally reduces the basic rate by 20 to 33%. The weekend discount is
not available to guests who stay for five nights or more. The hotel also offers
discounts to guests who stay under certain corporate accounts. These discounts
are often negotiated with the corporate customer and vary from account to
account.

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     The following table shows the average effective annual rental per square
foot since the opening of the Missouri hotel:

                                      2001
                    2000           (annualized)
                    ----           -----------

                   $31.74            $33.03


The depreciable real property component of the Missouri hotel has a currently
estimated Federal tax basis of $11.5 million and will be depreciated using the
straight-line method over a life of 39 years (or less, as permitted by the
Internal Revenue Code). The basis of the personal property component of the
hotel will be depreciated in accordance with the modified accelerated cost
recovery system of the Internal Revenue Code.

     The following table shows the Missouri hotel's real estate tax information
for 2000:

Tax Assessed Tax Amount Jurisdiction Value Rate of Tax
 ------------ -------- ---- ------

County of St. Louis               $2,573,370         0.08372        $215,442.54

     We estimate that the annual property tax on the expected improvements will
be no more than approximately $16,800.

Property Acquisition in Oregon

On June 15, 2001, we acquired the Beaverton Homewood Suites(R) by Hilton near
Portland, Oregon for a base purchase price of $10.5 million. The hotel is
located on a 3.3 acre site at 15525 Northwest Gateway Court, Beaverton, OR
97006. The hotel is approximately 15 miles from the center of downtown Portland
and 22 miles from the Portland International Airport.

The Oregon hotel opened in July 1998. It consists of one building with four
floors and contains a total of 123 suites, which have a combined rentable area
of 63,688 square feet. The following types of suites are available:

     Type of Suite             Number Available        Square Feet/per Suite
     -------------             ----------------        ---------------------

     King Suite                       98                     489
     Twin Suite                       18                     543
     Two-Bedroom Suite                 7                     856


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The Oregon hotel offers a 40-seat breakfast/lounge area, three meeting rooms
that, combined, accommodate up to 55 people, and a business center that offers
guests the use of a personal computer, printer and photocopier. Recreational
facilities include an outdoor pool and an exercise room. The hotel also contains
a guest convenience store and laundry facility. The hotel has its own parking
lot with approximately 135 spaces. The hotel provides complimentary shuttle
service within a five-mile radius.

We believe that the Oregon hotel has been well maintained and is generally in
very good condition. Over the next 12 months, we plan to spend approximately
$220,000 on renovations or improvements. We expect that the principal
renovations and improvements will include minor room renovations and additional
exterior signage.

During 2001 (through the end of May), approximately 54% of the guests have
stayed for five nights or more. In general, occupancy at the hotel is not
significantly affected by seasonal variations. The following table shows average
daily occupancy rates since the opening of the Oregon hotel:

                  Average Daily Occupancy Rate (calendar year)


                                                            2001
    1998                  1999              2000        (through May)
    ----                  ----              ----        -------------

   34.9%                59.0%             75.1%                69.6%


During 2001 (through the end of May), the average daily rate per suite has been
$86.19, and the average daily net revenue per suite has been $60.17. The Oregon
hotel's current rate structure is based on length of stay and type of suite, as
summarized below:

 Length of Stay
(number of nights)         King           Twin            Two Bedroom
------------------         ----           ----            -----------

1 to 5                     $149           $159                 $179
5 to 11                     139            149                  175
12 to 21                    129            139                  159
22 or more                  119            129                  139


The Oregon hotel offers a weekend discount. This discount varies by type of
suite and generally reduces the basic rate by 20 to 33%. The weekend discount is
not available to guests who stay for five nights or more. The hotel also offers
discounts to guests who stay under certain corporate accounts. These discounts
are often negotiated with the corporate customer and vary from account to
account.

     The following table shows the average effective annual rental per square
foot since the opening of the Oregon hotel:

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                                                        2001
      1998              1999             2000        (annualized)
      ----              ----             ----        ------------

     $20.22            $32.54           $42.27          $42.42


The depreciable real property component of the Oregon hotel has a currently
estimated Federal tax basis of $10.5 million and will be depreciated using the
straight-line method over a life of 39 years (or less, as permitted by the
Internal Revenue Code). The basis of the personal property component of the
hotel will be depreciated in accordance with the modified accelerated cost
recovery system of the Internal Revenue Code.

     The following table shows the Oregon hotel's real estate tax information
for 2001:

Tax Assessed Tax Amount Jurisdiction Value Rate of Tax
------------ -------- ---- ------

County of Washington        $3,584,350     0.0167451          $60,020.30


     We estimate that the annual property tax on the expected improvements will
be no more than approximately $3,700.00.

Financing of Property Acquisitions

The purchase of our new hotels was achieved with short-term seller financing for
75% of the base purchase price. The short-term financing for each hotel is
evidenced by a separate promissory note that is secured by the hotel involved.
The notes are described below:

                                      Base             Principal
     Location of Hotel            Purchase Price      Amount of Note
     -----------------            --------------      --------------

     Chesterfield, Missouri        $11,500,000         $ 8,625,000
     Beaverton, Oregon              10,500,000           7,875,000
                                   -----------         -----------

                      TOTAL        $22,000,000         $16,500,000

     Each promissory note is substantially similar and provides for the
     following:

     o  a maturity date of December 15, 2001
     o  a stated annual interest rate of 8.5%
     o  the monthly payment of interest only until maturity
     o  the full payment of principal and all other amounts at maturity
     o  the acceleration, at the option of the lender, of all amounts due under
        the note upon any default under the note or the related loan documents
     o  a late payment premium of 4% on any payment that is not made within 10
        days of its due date
     o  a right of prepayment, in whole or in part, without premium or penalty


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We directly acquired the hotel in Oregon and executed the related promissory
note. The promissory note for the hotel in Missouri was signed both by us and by
Apple Suites-MO, LLC, as the new wholly-owned subsidiary that acquired the
hotel.

Cross-Default Provisions

The two hotels that secure the promissory notes are subject to cross- default
and cross-collateral provisions under separate and corresponding deeds of trust
and related security documents. In general, any default under one promissory
note would constitute a default under the other promissory note and would enable
the lender to exercise its rights against both of the hotels.

Deeds of Trust and Security Documents

The hotels that secure the promissory notes are subject to mortgages and other
encumbrances, including a security interest in the related personal property and
various assignments of leases and rents, all in favor of the lender. These
encumbrances are created by multiple agreements and instruments, which will be
referred to as "security documents" for simplicity.

The security documents impose a number of requirements, including obligations to
maintain adequate insurance. The security documents prohibit any further
encumbrances and any further assignments of leases or rents with respect to the
hotels.

Upon any default that occurs under a promissory note or related security
document, various remedies are available to the lender. Those remedies include,
for example (a) declaring the entire principal balance under the promissory
notes, together with all accrued and unpaid interest, to be due and payable
immediately; (b) taking possession of the collateral, including the hotels; and
(c) collecting rents from the hotels, or foreclosing on such properties, to
satisfy unpaid amounts under the promissory notes. The lender would be entitled
to recover any costs that it may incur in exercising such remedies.

Hotel License Agreements

Each of our new hotels is licensed to operate as part of the Homewood Suites(R)
by Hilton franchise under separate franchise license agreements between Apple
Suites Management, Inc. and Promus Hotels, Inc. (Apple Suites Management, Inc.
is one of our wholly-owned subsidiaries and leases the hotels from us under
separate lease agreements that are substantially similar to lease agreements for
our other hotels). The franchise license agreements are substantially similar to
the franchise license agreement executed with respect to the Atlanta/Buckhead
hotel that we acquired in April 2001.

Hotel Management Agreements

Each of our new hotels is or will be managed under separate management
agreements between Apple Suites Management, Inc. and Promus Hotels, Inc. The
management agreements are substantially similar to the management agreement
executed with respect to the Atlanta/Buckhead hotel that we acquired in April
2001.

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