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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2007
|- | -----------------------------------------------------------------------------------------------------------------------------------------



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
 TO
|- | ----------------------------------------------------------------------------------------------------------------------------

Commission File Number 000-51270



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APPLE REIT SIX, INC.

(Exact name of
registrant as specified in its charter)



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|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|VIRGINIA                                                       |  | 20-0620523                       
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)



|                                         |  |           
|---------------------------------------- |  | ----------
|814 EAST MAIN STREET RICHMOND, VIRGINIA  |  | 23219     
|(Address of principal executive offices) |  | (Zip Code)

(804) 344-8121

(Registrants telephone number, including area code)



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2
of the Exchange Act:

Large accelerated filer ̈Accelerated filer ̈Non-accelerated
filer  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).    Yes ̈No  x

Number of registrants common shares outstanding as of November 1, 2007: 89,761,976



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APPLE REIT SIX, INC.

FORM 10-Q

INDEX



|                                                                                                      |  |             |  | 
|----------------------------------------------------------------------------------------------------- |  | ----------- |  | 
|                                                                                                      |  | Page Number
|PART I. FINANCIAL INFORMATION                                                                        
|                                                                                                      | 
|Item 1.        Financial Statements (Unaudited)                                                       |  |            
|                                                                                                      | 
|Consolidated Balance Sheets -                                                                         |  | 3          
|September 30, 2007 and December 31, 2006                                                              |  |            
|                                                                                                      | 
|Consolidated Statements of Operations -                                                               |  | 4          
|Three and nine months ended September 30, 2007 and                                                    |  |            
|Three and nine months ended September 30, 2006                                                        |  |            
|                                                                                                      | 
|Consolidated Statements of Cash Flows -                                                               |  | 5          
|Nine months ended September 30, 2007 and                                                              |  |            
|Nine months ended September 30, 2006                                                                  |  |            
|                                                                                                      | 
|Notes to Consolidated Financial Statements                                                            |  | 6          
|                                                                                                      | 
|Item 2.        
Management's Discussion and Analysis of Financial Condition and Results of Operations |  | 9          
|                                                                                                      | 
|Item 3.        
Quantitative and Qualitative Disclosures About Market Risk                            |  | 14         
|                                                                                                      | 
|Item 4.        
Controls and Procedures                                                               |  | 14         
|                                                                                                      | 
|PART II. OTHER INFORMATION                                                                            |  |            
|                                                                                                      | 
|Item 1.        Legal Proceedings (not applicable)                                                     |  |            
|                                                                                                      | 
|Item 1A.     Risk Factors (not applicable)                                                            |  |            
|                                                                                                      | 
|Item 2.        
Unregistered Sales of Equity Securities and Use of Proceeds                           |  | 15         
|                                                                                                      | 
|Item 3.        Defaults Upon Senior Securities (not applicable)                                       |  |            
|                                                                                                      | 
|Item 4.        Submission of Matters to a Vote of Security Holders (not
applicable)                   |  |            
|                                                                                                      | 
|Item 5.        Other Information (not applicable)                                                     |  |            
|                                                                                                      | 
|Item 6.        
Exhibits                                                                              |  | 16         
|                                                                                                      | 
|Signatures                                                                                            |  | 17         

This Form 10-Q includes references to
certain trademarks or service marks. The SpringHill Suites® by Marriott, TownePlace Suites® by Marriott, Fairfield Inn® by Marriott, Courtyard® by Marriott, Residence Inn® by Marriott and
Marriott Suites® trademarks are the property of Marriott International, Inc. or one of its affiliates. The Homewood Suites® by
Hilton, Hilton Garden Inn®, Hampton Inn® and Hampton Inn & Suites® trademarks are the property of Hilton Hotels Corporation or one or more of its affiliates. For convenience, the applicable trademark or servicemark symbol has been omitted but will be deemed to be included wherever the above-referenced terms
are used.



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Apple REIT Six, Inc.

Consolidated Balance Sheets

(unaudited)

(in thousands, except share data)



|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|---------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                                                               |  | September 30,2007 |         |   | December 31,2006 |  
|ASSETS                                                                                                                                         |  |                   |         |   |                  |   |         |  
|Investment in real estate, net of accumulated depreciation of $57,872 and $37,928, respectively                                                |  | $                 | 822,434 |   |                  | $ | 836,906 |  
|Cash and cash equivalents                                                                                                                      |  |                   | 35,386  |   |                  |   | 26,160  |  
|Restricted cash-furniture, fixtures and other escrows                                                                                          |  |                   | 3,827   |   |                  |   | 3,350   |  
|Due from third party manager, net                                                                                                              |  |                   | 13,017  |   |                  |   | 8,948   |  
|Other assets, net                                                                                                                              |  |                   | 8,880   |   |                  |   | 11,475  |  
|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|TOTAL ASSETS                                                                                                                                   |  | $                 | 883,544 |   |                  | $ | 886,839 |  
|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|LIABILITIES                                                                                                                                    |  |                   |         |   |                  |   |         |  
|Notes payable                                                                                                                                  |  | $                 | 52,186  |   |                  | $ | 53,660  |  
|Other liabilities                                                                                                                              |  |                   | 10,860  |   |                  |   | 7,133   |  
|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|TOTAL LIABILITIES                                                                                                                              |  |                   | 63,046  |   |                  |   | 60,793  |  
|                                                                                                                                               |  |                  
|SHAREHOLDERS EQUITY                                                                                                                           |  |                   |         |   |                  |   |         |  
|Preferred stock, authorized 15,000,000 shares; none issued and outstanding                                                                     |  |                   |        |   |                  |   |        |  
|Series A preferred stock, no par value, authorized 200,000,000 shares; issued and outstanding 89,962,312 and 89,773,345 shares, respectively   |  |                   |        |   |                  |   |        |  
|Series B convertible preferred stock, no par value, authorized 240,000 shares; issued and outstanding 240,000 and 240,000 shares, respectively |  |                   | 24      |   |                  |   | 24      |  
|Common stock, no par value, authorized 200,000,000 shares; issued and outstanding 89,962,312 and 89,773,345 shares,
respectively               |  |                   | 885,371 |   |                  |   | 883,174 |  
|Distributions greater than net income                                                                                                          |  |                   | (64,897 | ) |                  |   | (57,152 | )
|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|TOTAL SHAREHOLDERS EQUITY                                                                                                                     |  |                   | 820,498 |   |                  |   | 826,046 |  
|                                                                                                                                               |  |                   |         |   |                  |   |         |  
|TOTAL LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                     |  | $                 | 883,544 |   |                  | $ | 886,839 |  
|                                                                                                                                               |  |                   |         |   |                  |   |         |  

See notes to consolidated financial statements.



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Apple REIT Six, Inc.

Consolidated Statements of Operations

(unaudited)

(in thousands, except
per share data)



|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|-------------------------------------------------------------- |  | ---------------------------------- | ------ | - | ---------------------------------- | - | ------ | --------------------------------- |  | - | --------------------------------- | - |  | - | ------- | -
|                                                               |  | Three monthsendedSeptember 30,2007 |        |   | Three monthsendedSeptember 30,2006 |   |        | Nine MonthsendedSeptember 30,2007 |  |   | Nine MonthsendedSeptember 30,2006 |  
|Revenues:                                                      |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Room revenue                                                   |  | $                                  | 64,532 |   |                                    | $ | 61,292 |                                   |  | $ | 182,808                           |   |  | $ | 167,765 |  
|Other revenue                                                  |  |                                    | 4,873  |   |                                    |   | 4,366  |                                   |  |   | 14,735                            |   |  |   | 13,116  |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Total revenue                                                  |  |                                    | 69,405 |   |                                    |   | 65,658 |                                   |  |   | 197,543                           |   |  |   | 180,881 |  
|                                                               |  |                                    |        |  
|Expenses:                                                      |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Operating expense                                              |  |                                    | 16,615 |   |                                    |   | 16,196 |                                   |  |   | 47,796                            |   |  |   | 46,357  |  
|Hotel administrative expense                                   |  |                                    | 5,261  |   |                                    |   | 4,889  |                                   |  |   | 15,254                            |   |  |   | 13,857  |  
|Sales and marketing                                            |  |                                    | 5,186  |   |                                    |   | 4,891  |                                   |  |   | 14,815                            |   |  |   | 13,863  |  
|Utilities                                                      |  |                                    | 2,695  |   |                                    |   | 2,707  |                                   |  |   | 7,401                             |   |  |   | 7,321   |  
|Repair and maintenance                                         |  |                                    | 2,817  |   |                                    |   | 2,593  |                                   |  |   | 8,247                             |   |  |   | 7,369   |  
|Franchise fees                                                 |  |                                    | 2,787  |   |                                    |   | 2,503  |                                   |  |   | 7,882                             |   |  |   | 6,827   |  
|Management fees                                                |  |                                    | 2,587  |   |                                    |   | 2,092  |                                   |  |   | 7,930                             |   |  |   | 6,820   |  
|Taxes, insurance and other                                     |  |                                    | 3,634  |   |                                    |   | 3,663  |                                   |  |   | 10,689                            |   |  |   | 10,244  |  
|General and administrative                                     |  |                                    | 1,211  |   |                                    |   | 939    |                                   |  |   | 3,962                             |   |  |   | 3,125   |  
|Depreciation expense                                           |  |                                    | 6,956  |   |                                    |   | 6,476  |                                   |  |   | 20,580                            |   |  |   | 18,913  |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Total expenses                                                 |  |                                    | 49,749 |   |                                    |   | 46,949 |                                   |  |   | 144,556                           |   |  |   | 134,696 |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Operating income                                               |  |                                    | 19,656 |   |                                    |   | 18,709 |                                   |  |   | 52,987                            |   |  |   | 46,185  |  
|                                                               |  |                                    |        |  
|Interest expense, net                                          |  |                                    | (447   | ) |                                    |   | (589   | )                                 |  |   | (1,679                            | ) |  |   | (1,890  | )
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Net income                                                     |  | $                                  | 19,209 |   |                                    | $ | 18,120 |                                   |  | $ | 51,308                            |   |  | $ | 44,295  |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Basic and diluted net income per common share                  |  | $                                  | 0.21   |   |                                    | $ | 0.20   |                                   |  | $ | 0.57                              |   |  | $ | 0.50    |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  
|Weighted average common shares outstanding - basic and diluted |  |                                    | 89,704 |   |                                    |   | 89,545 |                                   |  |   | 89,525                            |   |  |   | 88,619  |  
|                                                               |  |                                    |        |  
|Distributions declared per common share                        |  | $                                  | 0.22   |   |                                    | $ | 0.22   |                                   |  | $ | 0.66                              |   |  | $ | 0.66    |  
|                                                               |  |                                    |        |   |                                    |   |        |                                   |  |   |                                   |   |  |   |         |  

See notes to consolidated financial statements.



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Apple REIT Six, Inc.

Consolidated Statements of Cash Flows

(unaudited)

(in thousands)



|                                                                              |  |                                     |         |   |                                     |   |         |  
|----------------------------------------------------------------------------- |  | ----------------------------------- | ------- | - | ----------------------------------- | - | ------- | -
|                                                                              |  | Nine months endedSeptember 30, 2007 |         |   | Nine months endedSeptember 30, 2006 |  
|Cash flow provided by operating activities:                                   |  |                                     |         |   |                                     |   |         |  
|Net income                                                                    |  | $                                   | 51,308  |   |                                     | $ | 44,295  |  
|Adjustments to reconcile net income to cash provided by operating activities: |  |                                     |         |   |                                     |   |         |  
|Depreciation                                                                  |  |                                     | 20,580  |   |                                     |   | 18,913  |  
|Amortization of deferred financing costs and fair value adjustments           |  |                                     | (305    | ) |                                     |   | (314    | )
|Stock option expense                                                          |  |                                     | 68      |   |                                     |   | 69      |  
|Changes in operating assets and liabilities, net of amounts acquired/assumed: |  |                                     |         |   |                                     |   |         |  
|Due from third party manager                                                  |  |                                     | (4,069  | ) |                                     |   | (4,408  | )
|Other assets                                                                  |  |                                     | (727    | ) |                                     |   | (73     | )
|Other liabilities                                                             |  |                                     | 930     |   |                                     |   | 3,036   |  
|                                                                              |  |                                     |         |   |                                     |   |         |  
|Net cash provided by operating activities                                     |  |                                     | 67,785  |   |                                     |   | 61,518  |  
|                                                                              |  |                                    
|Cash flow used in investing activities:                                       |  |                                     |         |   |                                     |   |         |  
|Cash paid in acquisition of hotels                                            |  |                                     |        |   |                                     |   | (37,180 | )
|Acquisition of other assets                                                   |  |                                     | (246    | ) |                                     |   | (8,447  | )
|Capital improvements                                                          |  |                                     | (4,390  | ) |                                     |   | (10,096 | )
|Net decrease (increase) in cash restricted for property improvements          |  |                                     | (393    | ) |                                     |   | 9       |  
|Other investing activities, net                                               |  |                                     | 865     |   |                                     |   |        |  
|                                                                              |  |                                     |         |   |                                     |   |         |  
|Net cash used in investing activities                                         |  |                                     | (4,164  | ) |                                     |   | (55,714 | )
|                                                                              |  |                                    
|Cash flow used in financing activities:                                       |  |                                     |         |   |                                     |   |         |  
|Payment of financing costs                                                    |  |                                     |        |   |                                     |   | (101    | )
|Repayment of secured notes payable                                            |  |                                     | (1,072  | ) |                                     |   | (28,966 | )
|Minority interest contribution                                                |  |                                     | 3,601   |   |                                     |   |        |  
|Net proceeds from issuance of common stock                                    |  |                                     | 24,776  |   |                                     |   | 101,822 |  
|Redemptions of common stock                                                   |  |                                     | (22,647 | ) |                                     |   | (25,341 | )
|Cash distributions paid to shareholders                                       |  |                                     | (59,053 | ) |                                     |   | (58,312 | )
|                                                                              |  |                                     |         |   |                                     |   |         |  
|Net cash used in financing activities                                         |  |                                     | (54,395 | ) |                                     |   | (10,898 | )
|                                                                              |  |                                    
|Increase (decrease) in cash and cash equivalents                              |  |                                     | 9,226   |   |                                     |   | (5,094  | )
|                                                                              |  |                                    
|Cash and cash equivalents, beginning of period                                |  |                                     | 26,160  |   |                                     |   | 35,948  |  
|                                                                              |  |                                     |         |   |                                     |   |         |  
|Cash and cash equivalents, end of period                                      |  | $                                   | 35,386  |   |                                     | $ | 30,854  |  
|                                                                              |  |                                     |         |   |                                     |   |         |  
|Non-cash transactions:                                                        |  |                                     |         |   |                                     |   |         |  
|Notes payable-secured assumed in acquisitions                                 |  | $                                   |        |   |                                     | $ | 6,663   |  

See notes to consolidated financial statements.



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1

Basis of Presentation

The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information required by accounting principles generally accepted in the United States. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financials should be read in conjunction with the Companys audited financial statements
included in its 2006 Annual Report on Form 10-K. Operating results for the period ended September 30, 2007 are not necessarily indicative of the results that may be expected for the period ending December 31, 2007.

Note 2

General Information and Summary of Significant Accounting
Policies

Organization

Apple REIT
Six, Inc. (the Company) is a Virginia corporation formed to invest in hotels and other selected real estate in select metropolitan areas in the United States. Initial capitalization occurred on January 20, 2004 and operations began
on May 28, 2004 when the Company acquired its first hotel. On March 3, 2006, the Company concluded its best-efforts offering of Units (each Unit consists of one common share and one Series A preferred share). The Company has no foreign
operations or assets and its operating structure includes only one segment. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated upon
consolidation.

Earnings per Common Share

Basic earnings per common share is computed based upon the weighted average number of shares outstanding during the year. Diluted earnings per share is calculated after giving effect to all potential common shares that were dilutive and
outstanding for the year. There were no potential common shares with a dilutive effect during the three and nine months ended September 30, 2007 or 2006. Series B convertible preferred shares are not included in earnings per common share
calculations until such time as the Series B convertible preferred shares are converted to common shares.

Use of Estimates

The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Recently Adopted Accounting Pronouncements

Effective January 1, 2007, the Company adopted Financial Accounting
Standards Board (FASB) Interpretation (FIN) No. 48, Accounting for Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109. This interpretation requires that income tax positions recognized in an
entitys returns have a more-likely-than-not chance of being sustained prior to recording the related tax benefit in the financial statements. Tax benefits would be derecognized if information became available which indicated that it was
more-likely-than-not that the position would not be sustained. The adoption of this interpretation has not had a material impact on the Companys results of operations or financial position.



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Note 3

Sale of
Ownership Interest

In July 2007, the Company sold a 50% ownership interest in its subsidiary, Apple Air Holding, LLC (Apple Air), to
Apple REIT Seven, Inc. for $3.7 million in cash. This ownership interest is accounted for as a minority interest and is included in other liabilities on the Companys consolidated balance sheets.

Note 4

Related Parties

The Company has significant transactions with related parties. These transactions cannot be construed to be arms length, and the results of the
Companys operations may be different if these transactions were conducted with non-related parties.

The Company has a contract with
Apple Six Realty Group, Inc. (ASRG), a related party, to provide brokerage services for the acquisition and disposition of the Companys real estate assets. In accordance with the contract, ASRG is paid a fee of 2% of the gross
purchase price of any acquisitions or gross sale price of any dispositions of real estate investments, subject to certain conditions. As of September 30, 2007, payments to ASRG for services under the terms of this contract have totaled $16.6
million since inception, which were capitalized as a part of the purchase price of the hotels. There were no fees incurred during the first nine months of 2007 under this contract.

The Company is party to an advisory agreement with Apple Six Advisors, Inc. (ASA), pursuant to which ASA provides management services to the
Company. An annual fee ranging from .1% to .25% of total equity proceeds received by the Company, in addition to certain reimbursable expenses, is payable for these services. From May to October 2007, ASA utilized Apple Hospitality Five, Inc. to
provide these services. Until May 2007, ASA used Apple Hospitality Two, Inc. to provide these services. Expenses related to the ASA agreement for the nine months ended September 30, 2007 and 2006, totaled approximately $2.4 million and $1.7
million, respectively.

Mr. Knight is Chairman and Chief Executive Officer of ASRG, ASA, Apple REIT Seven, Inc. (a diversified REIT)
and Apple REIT Eight, Inc. (a newly formed company that intends to qualify as a REIT). Mr. Knight was also Chairman and Chief Executive Officer of Apple Hospitality Two, Inc. (a hospitality REIT) until May 2007 and Apple Hospitality Five, Inc.
(a hospitality REIT) until October 2007. Members of the Companys Board of Directors are also on the boards of Apple REIT Seven, Inc. and Apple REIT Eight, Inc. Until May 2007, members of the Companys Board of Directors were also on the
board of Apple Hospitality Two, Inc. and, until October 2007, were on the board of Apple Hospitality Five, Inc.

Note 5

Shareholders Equity

In July 2005, the Company
instituted a Unit Redemption Program to provide limited interim liquidity to its shareholders who have held their Units for at least one year. Shareholders may request redemption of Units for a purchase price equal to the lesser of: (1) the
purchase price per Unit that the shareholder actually paid for the Unit; or (2) $11.00 per Unit. The Company reserves the right to change the purchase price of redemptions, reject any request for redemption, or otherwise amend the terms of,
suspend, or terminate the Unit Redemption Program. During the nine months ended September 30, 2007, the Company redeemed approximately 2.1 million Units in the amount of $22.6 million under the program.

In February 2006, the Company instituted a Dividend Reinvestment Plan for its shareholders. The plan provides a convenient and cost effective way to
increase shareholder investment in the Company by reinvesting dividends to purchase additional Units of the Company. The uses of the proceeds from this plan may include purchasing Units under the Companys Unit Redemption Program, enhancing
properties,



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satisfying financing obligations and other expenses, increasing working capital, funding various corporate operations, and acquiring hotels. During the nine
months ended September 30, 2007, approximately 2.3 million Units, representing $24.8 million in proceeds to the Company, were issued under the plan.

In January 2004, the Board of Directors approved a Non-Employee Directors Stock Option Plan whereby directors, who are not employees of the Company or affiliates, automatically receive the option to purchase Units.
During the second quarters of 2007 and 2006 the Company issued approximately 72,000 directors stock options in each period and share-based expense of approximately $68,000 and $69,000, respectively, was recorded.

Note 6

Subsequent Events

In October 2007, the Company declared and paid approximately $6.6 million, or $.073 per share, in distributions to its common shareholders of which $2.8
million or 257,261 Units were reinvested under the Companys Dividend Reinvestment Plan.

On October 22, 2007, the Company
redeemed 457,598 Units in the amount of $5.0 million under its Unit Redemption Program.

In October 2007, Apple Hospitality Five, Inc.
(AHF) was merged with and into an unrelated third party. Upon the merger, the Company acquired all of AHFs interest in Apple Fund Management, LLC, which was a wholly-owned subsidiary of AHF that provides the services to the Company
under its advisory agreements with ASA and ASRG. There was no significant incremental cost to the Company as a result of acquiring this entity.



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|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operation
|------- | ------------------------------------------------------------------------------------

This quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the Company to be
materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include the ability of the Company to implement its acquisition strategy and operating strategy; the
Companys ability to manage planned growth; changes in economic cycles and competition within the hotel industry. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable,
any of the assumptions could be inaccurate, and therefore there can be no assurance that such statements included in the quarterly report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking
statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the results or conditions described in such statements or the objectives and plans of the Company will
be achieved. In addition, the Companys qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code. Readers should carefully review the
Companys financial statements and the notes thereto, as well as the risk factors described in the Companys filings with the Securities and Exchange Commission.

Overview

Apple REIT Six, Inc. (together with its wholly owned subsidiaries, the Company)
was formed and initially capitalized on January 20, 2004, with its first investor closing on April 23, 2004. The Company owns 67 hotels within different markets in the United States. The Company is treated as a Real Estate Investment Trust
(REIT) for federal income tax purposes. The Companys first hotel was acquired on May 28, 2004, with 11 total hotels purchased in 2004, 51 hotels purchased in 2005 and 5 hotels purchased in 2006. Accordingly, the results of
operations include only the results of the hotels for the period owned. Although hotel performance can be influenced by many factors including local competition, local and general economic conditions in the United States and the performance of
individual managers assigned to each hotel, performance of the hotels, in general, has met the Companys expectations for the period owned. In evaluating financial condition and operating performance, the most important matters on which the
Company focuses are revenue measurements, such as average occupancy, average daily rate and revenue per available room, and expenses, such as hotel operating expenses, general and administrative and other expenses described below. The following is a
summary of the Companys results:



|                                   |  |                                  |        |   |                                 |     |   |      |   |        |                   |  |     |               |  |     |      |  |   |                   |   |  |      |   |  |                   |         |   |               |     |   |  |     |  
|---------------------------------- |  | -------------------------------- | ------ | - | ------------------------------- | --- | - | ---- | - | ------ | ----------------- |  | --- | ------------- |  | --- | ---- |  | - | ----------------- | - |  | ---- | - |  | ----------------- | ------- | - | ------------- | --- | - |  | --- | -
|                                   |  | Three months ended September 30, |        |   | Nine months ended September 30, |    
|                                   |  | 2007                             |        |   | Percent ofRevenue               |     |   | 2006 |   |        | Percent ofRevenue |  |     | Percentchange |  |     | 2007 |  |   | Percent ofRevenue |   |  | 2006 |   |  | Percent ofRevenue |         |   | Percentchange |    
|Total revenues                     |  | $                                | 69,405 |   |                                 | 100 | % |      | $ | 65,658 |                   |  | 100 | %             |  | 6   | %    |  | $ | 197,543           |   |  | 100  | % |  | $                 | 180,881 |   |               | 100 | % |  | 9   | %
|Hotel direct expenses              |  |                                  | 37,948 |   |                                 | 55  | % |      |   | 35,871 |                   |  | 55  | %             |  | 6   | %    |  |   | 109,325           |   |  | 55   | % |  |                   | 102,414 |   |               | 57  | % |  | 7   | %
|Taxes, insurance and other expense |  |                                  | 3,634  |   |                                 | 5   | % |      |   | 3,663  |                   |  | 6   | %             |  | -1  | %    |  |   | 10,689            |   |  | 5    | % |  |                   | 10,244  |   |               | 6   | % |  | 4   | %
|General and administrative         |  |                                  | 1,211  |   |                                 | 2   | % |      |   | 939    |                   |  | 1   | %             |  | 29  | %    |  |   | 3,962             |   |  | 2    | % |  |                   | 3,125   |   |               | 2   | % |  | 27  | %
|Depreciation                       |  |                                  | 6,956  |   |                                 |     |   |      |   | 6,476  |                   |  |     |               |  | 7   | %    |  |   | 20,580            |   |  |      |   |  |                   | 18,913  |   |               |     |   |  | 9   | %
|                                   |  |                                  |        |   |                                 |     |   |      |   |       
|Interest expense, net              |  |                                  | 447    |   |                                 |     |   |      |   | 589    |                   |  |     |               |  | -24 | %    |  |   | 1,679             |   |  |      |   |  |                   | 1,890   |   |               |     |   |  | -11 | %
|                                   |  |                                  |        |   |                                 |     |   |      |   |       
|ADR                                |  | $                                | 117    |   |                                 |     |   |      | $ | 108    |                   |  |     |               |  | 8   | %    |  | $ | 114               |   |  |      |   |  | $                 | 105     |   |               |     |   |  | 9   | %
|Occupancy                          |  |                                  | 77     | % |                                 |     |   |      |   | 79     | %                 |  |     |               |  | -3  | %    |  |   | 76                | % |  |      |   |  |                   | 76      | % |               |     |   |  |    | %
|RevPAR                             |  | $                                | 90     |   |                                 |     |   |      | $ | 85     |                   |  |     |               |  | 6   | %    |  | $ | 86                |   |  |      |   |  | $                 | 80      |   |               |     |   |  | 8   | %



9



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##### Table of Contents

Hotels Owned

As of September 30, 2007, the Company owned 67 hotels, with a total of 7,750 rooms. The following table summarizes the location, brand, manager, date acquired, number of rooms and gross purchase price for each hotel. All dollar amounts
are in thousands.



|                 |  |                |  |                      |  |              |  |              |  |       |  |                    |        
|---------------- |  | -------------- |  | -------------------- |  | ------------ |  | ------------ |  | ----- |  | ------------------ | -------
|City             |  | State          |  | Brand                |  | Manager      |  | DateAcquired |  | Rooms |  | GrossPurchasePrice
|Birmingham       |  | Alabama        |  | Fairfield Inn        |  | LBA          |  | 8/25/05      |  | 63    |  | $                  | 2,176  
|Dothan           |  | Alabama        |  | Courtyard            |  | LBA          |  | 8/11/05      |  | 78    |  |                    | 8,016  
|Dothan           |  | Alabama        |  | Hampton Inn & Suites |  | LBA          |  | 6/24/05      |  | 85    |  |                    | 8,673  
|Huntsville       |  | Alabama        |  | Fairfield Inn        |  | LBA          |  | 9/30/05      |  | 79    |  |                    | 4,954  
|Huntsville       |  | Alabama        |  | Residence Inn        |  | LBA          |  | 6/24/05      |  | 78    |  |                    | 8,288  
|Montgomery       |  | Alabama        |  | SpringHill Suites    |  | LBA          |  | 9/30/05      |  | 79    |  |                    | 6,835  
|Tuscaloosa       |  | Alabama        |  | Courtyard            |  | LBA          |  | 8/25/05      |  | 78    |  |                    | 7,551  
|Tuscaloosa       |  | Alabama        |  | Fairfield Inn        |  | LBA          |  | 8/25/05      |  | 63    |  |                    | 3,982  
|Anchorage        |  | Alaska         |  | Hampton Inn          |  | Stonebridge  |  | 3/14/05      |  | 101   |  |                    | 11,500 
|Anchorage        |  | Alaska         |  | Hilton Garden Inn    |  | Stonebridge  |  | 10/12/04     |  | 125   |  |                    | 18,900 
|Anchorage        |  | Alaska         |  | Homewood Suites      |  | Stonebridge  |  | 10/12/04     |  | 122   |  |                    | 13,200 
|Phoenix          |  | Arizona        |  | Hampton Inn          |  | Stonebridge  |  | 10/12/04     |  | 99    |  |                    | 6,700  
|Tempe            |  | Arizona        |  | SpringHill Suites    |  | Western      |  | 6/30/05      |  | 121   |  |                    | 8,060  
|Tempe            |  | Arizona        |  | TownePlace Suites    |  | Western      |  | 6/30/05      |  | 119   |  |                    | 8,128  
|Arcadia          |  | California     |  | Hilton Garden Inn    |  | Stonebridge  |  | 10/12/04     |  | 124   |  |                    | 12,000 
|Arcadia          |  | California     |  | SpringHill Suites    |  | Stonebridge  |  | 10/12/04     |  | 86    |  |                    | 8,100  
|Bakersfield      |  | California     |  | Hilton Garden Inn    |  | Hilton       |  | 3/18/05      |  | 120   |  |                    | 11,500 
|Folsom           |  | California     |  | Hilton Garden Inn    |  | Inn Ventures |  | 11/30/05     |  | 100   |  |                    | 18,028 
|Foothill Ranch   |  | California     |  | Hampton Inn          |  | Stonebridge  |  | 4/21/05      |  | 84    |  |                    | 7,400  
|Lake Forest      |  | California     |  | Hilton Garden Inn    |  | Stonebridge  |  | 10/12/04     |  | 103   |  |                    | 11,400 
|Milpitas         |  | California     |  | Hilton Garden Inn    |  | Inn Ventures |  | 11/30/05     |  | 161   |  |                    | 18,600 
|Roseville        |  | California     |  | Hilton Garden Inn    |  | Inn Ventures |  | 11/30/05     |  | 131   |  |                    | 20,759 
|San Francisco    |  | California     |  | Hilton Garden Inn    |  | Inn Ventures |  | 1/30/06      |  | 169   |  |                    | 12,266 
|Boulder          |  | Colorado       |  | Marriott             |  | WLS          |  | 5/9/05       |  | 157   |  |                    | 30,000 
|Glendale         |  | Colorado       |  | Hampton Inn & Suites |  | Stonebridge  |  | 10/12/04     |  | 133   |  |                    | 14,700 
|Lakewood         |  | Colorado       |  | Hampton Inn          |  | Stonebridge  |  | 10/12/04     |  | 170   |  |                    | 10,600 
|Farmington       |  | Connecticut    |  | Courtyard            |  | WLS          |  | 10/20/05     |  | 119   |  |                    | 16,330 
|Rocky Hill       |  | Connecticut    |  | Residence Inn        |  | WLS          |  | 8/1/05       |  | 96    |  |                    | 12,070 
|Wallingford      |  | Connecticut    |  | Homewood Suites      |  | WLS          |  | 7/8/05       |  | 104   |  |                    | 12,780 
|Clearwater       |  | Florida        |  | SpringHill Suites    |  | LBA          |  | 2/17/06      |  | 79    |  |                    | 6,923  
|Lake Mary        |  | Florida        |  | Courtyard            |  | LBA          |  | 3/18/05      |  | 86    |  |                    | 6,000  
|Lakeland         |  | Florida        |  | Residence Inn        |  | LBA          |  | 6/24/05      |  | 78    |  |                    | 9,886  
|Orange Park      |  | Florida        |  | Fairfield Inn        |  | LBA          |  | 11/8/05      |  | 83    |  |                    | 7,221  
|Panama City      |  | Florida        |  | Courtyard            |  | LBA          |  | 4/26/06      |  | 84    |  |                    | 9,245  
|Pensacola        |  | Florida        |  | Courtyard            |  | LBA          |  | 8/25/05      |  | 90    |  |                    | 11,369 
|Pensacola        |  | Florida        |  | Fairfield Inn        |  | LBA          |  | 8/25/05      |  | 63    |  |                    | 4,858  
|Pensacola        |  | Florida        |  | Hampton Inn & Suites |  | LBA          |  | 7/21/05      |  | 85    |  |                    | 9,279  
|Tallahassee      |  | Florida        |  | Hilton Garden Inn    |  | Hilton       |  | 3/18/05      |  | 99    |  |                    | 10,850 
|Albany           |  | Georgia        |  | Courtyard            |  | LBA          |  | 6/24/05      |  | 84    |  |                    | 8,597  
|Columbus         |  | Georgia        |  | Residence Inn        |  | LBA          |  | 6/24/05      |  | 78    |  |                    | 7,888  
|Savannah         |  | Georgia        |  | SpringHill Suites    |  | LBA          |  | 9/30/05      |  | 79    |  |                    | 5,407  
|Valdosta         |  | Georgia        |  | Courtyard            |  | LBA          |  | 10/3/05      |  | 84    |  |                    | 8,284  
|Mt. Olive        |  | New Jersey     |  | Residence Inn        |  | WLS          |  | 9/15/05      |  | 123   |  |                    | 12,070 
|Somerset         |  | New Jersey     |  | Homewood Suites      |  | WLS          |  | 8/17/05      |  | 123   |  |                    | 17,750 
|Saratoga Springs |  | New York       |  | Hilton Garden Inn    |  | WLS          |  | 9/29/05      |  | 112   |  |                    | 17,750 
|Hillsboro        |  | Oregon         |  | Courtyard            |  | Inn Ventures |  | 3/9/06       |  | 155   |  |                    | 11,000 
|Hillsboro        |  | Oregon         |  | Residence Inn        |  | Inn Ventures |  | 3/9/06       |  | 122   |  |                    | 15,500 
|Hillsboro        |  | Oregon         |  | TownePlace Suites    |  | Inn Ventures |  | 12/19/05     |  | 136   |  |                    | 11,500 
|Portland         |  | Oregon         |  | Residence Inn        |  | Inn Ventures |  | 12/19/05     |  | 258   |  |                    | 42,000 
|Pittsburgh       |  | Pennsylvania   |  | Residence Inn        |  | WLS          |  | 9/2/05       |  | 156   |  |                    | 11,000 
|Myrtle Beach     |  | South Carolina |  | Courtyard            |  | Marriott     |  | 6/8/04       |  | 135   |  |                    | 9,200  
|Nashville        |  | Tennessee      |  | Homewood Suites      |  | Hilton       |  | 5/24/05      |  | 121   |  |                    | 8,103  
|Arlington        |  | Texas          |  | SpringHill Suites    |  | Western      |  | 6/30/05      |  | 122   |  |                    | 7,486  
|Arlington        |  | Texas          |  | TownePlace Suites    |  | Western      |  | 6/30/05      |  | 95    |  |                    | 7,148  
|Dallas           |  | Texas          |  | SpringHill Suites    |  | Western      |  | 12/9/05      |  | 147   |  |                    | 19,500 
|Ft. Worth        |  | Texas          |  | Homewood Suites      |  | Hilton       |  | 5/24/05      |  | 137   |  |                    | 9,097  
|Ft. Worth        |  | Texas          |  | Residence Inn        |  | Western      |  | 5/6/05       |  | 149   |  |                    | 17,000 
|Ft. Worth        |  | Texas          |  | SpringHill Suites    |  | Marriott     |  | 5/28/04      |  | 145   |  |                    | 13,340 
|Laredo           |  | Texas          |  | Homewood Suites      |  | Western      |  | 11/30/05     |  | 106   |  |                    | 10,500 
|Laredo           |  | Texas          |  | Residence Inn        |  | Western      |  | 9/12/05      |  | 109   |  |                    | 11,445 
|Las Colinas      |  | Texas          |  | TownePlace Suites    |  | Western      |  | 6/30/05      |  | 136   |  |                    | 7,178  
|McAllen          |  | Texas          |  | Hilton Garden Inn    |  | Western      |  | 7/19/05      |  | 104   |  |                    | 9,000  
|Fredericksburg   |  | Virginia       |  | Hilton Garden Inn    |  | Hilton       |  | 12/20/05     |  | 148   |  |                    | 16,600 
|Kent             |  | Washington     |  | TownePlace Suites    |  | Inn Ventures |  | 12/19/05     |  | 152   |  |                    | 12,000 
|Mukilteo         |  | Washington     |  | TownePlace Suites    |  | Inn Ventures |  | 12/19/05     |  | 128   |  |                    | 12,000 
|Redmond          |  | Washington     |  | Marriott             |  | Marriott     |  | 7/7/04       |  | 262   |  |                    | 64,000 
|Renton           |  | Washington     |  | Hilton Garden Inn    |  | Inn Ventures |  | 11/30/05     |  | 150   |  |                    | 16,096 
|                 |  |                |  |                      |  |              |  |              |  |       |  |                    |        
|                 |  |                |  |                      |  |              |  | Total        |  | 7,750 |  | $                  | 827,566
|                 |  |                |  |                      |  |              |  |              |  |       |  |                    |        



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##### Table of Contents

The Company leased all of its hotels to wholly-owned taxable REIT subsidiaries (collectively, the
lessee) under hotel lease agreements. The Company also used the proceeds from its best-efforts offering to pay 2% of the gross purchase price for these hotels, which equals approximately $16.6 million, as a commission to
Apple Six Realty Group, Inc. (ASRG). ASRG is owned by the Companys chairman, Chief Executive Officer and President, Glade M. Knight.

No goodwill or intangible assets were recorded in connection with any of the acquisitions.

Results of Operations

In general, performance at the Companys hotels has met expected financial results. Hotel performance is impacted by many factors
including the economic conditions in the United States, as well as each locality. As a result, there can be no assurance that the Companys operating performance will continue to meet expectations in the future.

Revenues

The Companys
principal source of revenue is hotel room revenue and other related revenue. Hotel operations are for the 67 hotels acquired through September 30, 2007 for their respective periods owned. For the three months ended September 30, 2007 and
2006, the Company had total revenue of $69.4 and $65.7 million, respectively, with average occupancy of 77% and 79%, average daily rate (ADR) of $117 and $108 and revenue per available room (RevPAR) of $90 and $85. For the
nine months ended September 30, 2007 and 2006, the Company had total revenue of $197.5 and $180.9 million, respectively, with average occupancy of 76% in both periods, ADR of $114 and $105 and RevPAR of $86 and $80. ADR is calculated as room
revenue divided by the number of rooms sold, and RevPAR is calculated as occupancy multiplied by ADR. These rates are consistent with industry and brand averages. The industry and the Company have seen RevPAR increases due to increases in demand
exceeding increases in supply of hotel rooms in the markets where the Companys hotels are located. Additionally, the Company continually works with the hotel managers to maximize rates. Although supply is beginning to increase in certain
markets that the company serves, growth in RevPAR as compared to 2006 is anticipated for the remainder of 2007.

Expenses

For the three months ended September 30, 2007 and 2006, hotel operating expenses totaled $37.9 and $35.9 million, respectively, or
55% of total revenue for each period. For the nine months ended September 30, 2007 and 2006, hotel operating expenses totaled $109.3 and $102.4 million, or 55% and 57% of total revenue, respectively. This percentage has decreased as revenues
for newly opened properties have increased and ADR has increased.

Taxes, insurance, and other expenses for the three months ended
September 30, 2007 and 2006 were $3.6 and $3.7 million or 5% and 6% of total revenue. For the nine months ended September 30, 2007 and 2006, taxes, insurance, and other expenses were $10.7 and $10.2 million or 5% and 6% of total revenue
for each period.

General and administrative expenses for the three months ended September 30, 2007 and 2006 were $1.2 and $0.9
million, or 2% and 1% of total revenue for each period, respectively. For the nine months ended September 30, 2007 and 2006, general and administrative expenses were $4.0 and $3.1 million, or 2% of total revenue. The principal components of
general and administrative expense are advisory fees, accounting fees and reporting expense.



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##### Table of Contents

Depreciation expense for the three months ended September 30, 2007 and 2006 was $7.0 and $6.5
million. Depreciation expense for the nine months ended September 30, 2007 and 2006 was $20.6 and $18.9 million. Depreciation expense represents expense of the Companys 67 hotels and related personal property for their respective periods
owned.

Interest expense, net was $0.4 and $0.6 million for the three months ended September 30, 2007 and 2006. Interest expense, net
for the nine months ended September 30, 2007 and 2006 was $1.7 and $1.9 million, respectively. Interest expense arose from debt assumed with 14 of the properties acquired and short term financing used in the first quarter of 2006 to bridge the
purchase of properties and the raising of capital. Total debt assumed was approximately $54.1 million.

Liquidity and Capital Resources

Operating cash flow from the properties owned and cash on hand ($35.4 million at September 30, 2007) are the Companys principal source of
liquidity. In addition, the Company may borrow funds, subject to limitations set forth in its bylaws. The Company anticipates that cash flow, and cash on hand, will be adequate to cover substantially all of its operating expenses and to permit the
Company to meet substantially all of its anticipated liquidity requirements, including distributions, capital expenditures and debt service.

The Company has on-going capital commitments to fund its capital improvements. The Company is required, under all of the hotel management agreements, to make available, for the repair, replacement, refurbishing of furniture, fixtures, and
equipment, an amount of 3% to 5% of gross revenues provided that such amount may be used for the Companys capital expenditures with respect to the hotels. The Company expects that this amount will be adequate to fund required repair,
replacement, and refurbishments and to maintain the Companys hotels in a competitive condition. As of September 30, 2007, the Company had made approximately $4.4 million of capital expenditures during 2007. The Company has begun
significant renovations on seven hotels. These renovations are expected to be completed during the fourth quarter of 2007 and the first quarter of 2008. The Company expects to make a total of approximately $8 million of capital expenditures related
to these projects.

To maintain its REIT status the Company is required to distribute at least 90% of its ordinary income. Distributions in
the first nine months of 2007 totaled $59.1 million and were paid monthly at a rate of $0.073 per common share. For the same period the Companys cash generated from operations was $67.8 million. The Company intends to continue paying dividends
on a monthly basis at an annual rate of 8%. Since there can be no assurance of the ability of the Companys properties to provide income at this level, there can be no assurance as to the classification or duration of distributions at the
current rate.

In February 2006, the Company instituted a Dividend Reinvestment Plan for its shareholders. The plan provides a convenient
and cost effective way to increase shareholder investment in the Company by reinvesting dividends to purchase additional Units of the Company. The uses of the proceeds from this plan may include purchasing Units under the Companys Unit
Redemption Program, enhancing properties, satisfying financing obligations and other expenses, increasing working capital, funding various corporate operations, and acquiring hotels. During the nine months ended September 30, 2007,
approximately 2.3 million Units, representing $24.8 million in proceeds to the Company, were issued under the plan.

In July 2005, the
Company instituted a Unit Redemption Program to provide limited interim liquidity to its shareholders who have held their Units for at least one year. Shareholders may request redemption of Units for a purchase price equal to the lesser of:
(1) the purchase price per Unit that the shareholder actually paid for the Unit; or (2) $11.00 per Unit. The Company reserves the right to change the purchase price of redemptions, reject any request for redemption, or otherwise amend the
terms of, suspend, or terminate the Unit Redemption Program. During the nine months ended September 30, 2007, the Company redeemed approximately 2.1 million Units in the amount of $22.6 million under the program. It is anticipated the
funds required for the redemption program will be offset by the funds received from the Dividend Reinvestment Plan over the course of the calendar year.



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##### Table of Contents

Related Party Transactions

The Company has significant transactions with related parties. These transactions cannot be construed to be arms length, and the results of the Companys operations may be different if these transactions were
conducted with non-related parties.

The Company has a contract with ASRG, a related party, to provide brokerage services for the
acquisition and disposition of the Companys real estate assets. In accordance with the contract, ASRG is paid a fee of 2% of the gross purchase price of any acquisitions or gross sale price of any dispositions of real estate investments,
subject to certain conditions. As of September 30, 2007, payments to ASRG for services under the terms of this contract have totaled $16.6 million since inception, which were capitalized as a part of the purchase price of the hotels. There were
no fees incurred during the first nine months of 2007 under this contract.

The Company is party to an advisory agreement with Apple Six
Advisors, Inc. (ASA), pursuant to which ASA provides management services to the Company. An annual fee ranging from .1% to .25% of total equity proceeds received by the Company, in addition to certain reimbursable expenses, is payable
for these services. From May to October 2007, ASA utilized Apple Hospitality Five, Inc. to provide these services. Until May 2007, ASA used Apple Hospitality Two, Inc. to provide these services. Expenses related to the ASA agreement for the nine
months ended September 30, 2007 and 2006, totaled approximately $2.4 and $1.7 million, respectively.

Mr. Knight is Chairman and
Chief Executive Officer of ASRG, ASA, Apple REIT Seven, Inc. (a diversified REIT) and Apple REIT Eight, Inc. (a newly formed company that intends to qualify as a REIT). Mr. Knight was also Chairman and Chief Executive Officer of Apple
Hospitality Two, Inc. (a hospitality REIT) until May 2007 and Apple Hospitality Five, Inc. (a hospitality REIT) until October 2007. Members of the Companys Board of Directors are also on the boards of Apple REIT Seven, Inc. and Apple REIT
Eight, Inc. Until May 2007, members of the Companys Board of Directors were also on the board of Apple Hospitality Two, Inc. and, until October 2007, were on the board of Apple Hospitality Five, Inc.

Impact of Inflation

Operators of hotels, in general,
possess the ability to adjust room rates daily to reflect the effects of inflation. Competitive pressures may, however, limit the operators ability to raise room rates. Currently the Company is not experiencing any material impact from
inflation.

Business Interruption

Being in the real estate industry, the Company is exposed to natural disasters both locally and nationally, and although management believes there is adequate insurance to cover this exposure, there can be no assurance that such events will
not have a material adverse effect on the Companys financial position or results of operations.

Seasonality

The hotel industry historically has been seasonal in nature. Seasonal variations in occupancy at the Companys hotels may cause quarterly
fluctuations in its revenues. To the extent that cash flow from operations is insufficient during any quarter, due to temporary or seasonal fluctuations in revenue, the Company expects to utilize cash on hand to make distributions.

Recently Adopted Accounting Pronouncements

Effective
January 1, 2007, the Company adopted Financial Accounting Standards Board (FASB) Interpretation (FIN) No. 48, Accounting for Uncertainty in Income Taxes  an interpretation of FASB



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##### Table of Contents

Statement No. 109. This interpretation requires that income tax positions recognized in an entitys returns have a more-likely-than-not chance of
being sustained prior to recording the related tax benefit in the financial statements. Tax benefits would be derecognized if information became available which indicated that it was more-likely-than-not that the position would not be sustained. The
adoption of this interpretation has not had a material impact on the Companys results of operations or financial position.

Subsequent Events

In October 2007, the Company declared and paid approximately $6.6 million, or $.073 per share, in distributions to its common shareholders
of which $2.8 million or 257,261 Units were reinvested under the Companys Dividend Reinvestment Plan.

On October 22, 2007, the
Company redeemed 457,598 Units in the amount of $5.0 million under its Unit Redemption Program.

In October 2007, Apple Hospitality Five,
Inc. (AHF) was merged with and into an unrelated third party. Upon the merger, the Company acquired all of AHFs interest in Apple Fund Management, LLC, which was a wholly-owned subsidiary of AHF that provides the services to the
Company under its advisory agreements with ASA and ASRG. There was no significant incremental cost to the Company as a result of acquiring this entity.



|Item 3. | Quantitative and Qualitative Disclosures About Market Risk
|------- | ----------------------------------------------------------

The Company does not engage in transactions in derivative financial instruments or derivative commodity instruments. As of September 30, 2007, the Companys financial instruments were not exposed to significant market risk due to
interest rate risk, foreign currency exchange risk, commodity price risk or equity price risk. The Company is exposed to changes in short term money market rates earned on its available cash. Based on the Companys cash invested at
September 30, 2007, of $35.4 million, every 100 basis points change in interest rates will impact the Companys annual net income by $354,000, all other factors remaining the same.



|Item 4. | Controls and Procedures
|------- | -----------------------

Senior management,
including the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Companys disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation process, the Chief
Executive Officer and Chief Financial Officer have concluded that the Companys disclosure controls and procedures are effective and that there have been no changes in the Companys internal control over financial reporting that occurred
during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.



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##### Table of Contents

PART II. OTHER INFORMATION



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds
|------- | -----------------------------------------------------------

Unit Redemption Program

In July 2005, the Company instituted a share redemption program to provide its shareholders who
have held their Units for at least one year with the benefit of limited interim liquidity, by presenting for redemption all or any portion of their Units at any time and in accordance with certain procedures. Once this time limitation has been met,
the Company may, subject to certain conditions and limitations, redeem the Units presented for redemption for cash, to the extent that the Company has sufficient funds available to fund the redemption. If Units are held for the required one-year
period, the Units may be redeemed for a purchase price equal to the lesser of: (1) $11.00 per Unit; or (2) the purchase price per Unit that was actually paid for the Units. The board of directors reserves the right, in its sole discretion,
at any time and from time to time, to waive the one-year holding period, reject any request for redemption, change the purchase price for redemptions or otherwise amend the terms of, suspend, or terminate the Unit redemption program. The following
is a summary of redemptions during the third quarter of 2007:

Issuer Purchases of Equity Securities



|          |  |                               |  |                            |  |                                                                             |  |                                                                             
|--------- |  | ----------------------------- |  | -------------------------- |  | --------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------
|          |  | (a)                           |  | (b)                        |  | (c)                                                                         |  | (d)                                                                         
|Period    |  | Total Numberof UnitsPurchased |  | Average PricePaid per Unit |  | Total Number ofUnits Purchased asPart of PubliclyAnnounced Plansor
Programs |  | Maximum Numberof Units that MayYet Be PurchasedUnder the Plans orPrograms(1)
|July 2007 |  | 597,983                       |  | $10.99                     |  | 5,416,702                                                                   |  |                                                                             

---

|(1) | The maximum number of Units that may be redeemed in any 12 month period is limited
to five percent (5.0%) of the weighted average number of Units outstanding from the beginning of the 12 month period.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

|Item 6. | Exhibits
|------- | --------



|               |  |                                                                                                                                                                                                             
|-------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                                                                                                                                                 
|3.1            |  | Articles of Incorporation of the Company. (Incorporated by reference to Exhibit 3.1 to the Companys registration statement on Form S-11 (SEC File No. 333-112169) effective April 23, 2004).               
|               | 
|3.2            |  | Bylaws of the Company. (Incorporated by reference to Exhibit 3.2 to the Companys Post-Effective Amendment No. 4 to Form S-11 (SEC File No. 333-112169) effective June 14,
2005).                           
|               | 
|31.1           |  | Certification of the Companys Chief Executive Officer pursuant to Rule 13a  14(a) and Rule 15d  14(a) of the Securities Exchange Act, as amended (FILED
HEREWITH).                                       
|               | 
|31.2           |  | Certification of the Companys Chief Financial Officer pursuant to Rule 13a  14(a) and Rule 15d  14(a) of the Securities Exchange Act, as amended (FILED
HEREWITH).                                       
|               | 
|32.1           |  | Certification of the Companys Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(FILED HEREWITH).



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##### Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



|                     |  |                                                                                             |  |                       
|-------------------- |  | ------------------------------------------------------------------------------------------- |  | ----------------------
|APPLE REIT SIX, INC. |  |                                                                                            
|                     |  |                                                                                            
|By:                  |  | /s/ GLADE M. KNIGHT                                                                         |  | Date: November 2, 2007
|                     |  | Glade M. Knight,                                                                            |  |                       
|                     |  | Chairman of the Board, Chief Executive Officer, and President (Principal Executive Officer) |  |                       
|                     |  |                                                                                            
|By:                  |  | /s/ BRYAN PEERY                                                                             |  | Date: November 2, 2007
|                     |  | Bryan Peery,                                                                                |  |                       
|                     |  | Chief Financial Officer (Principal Financial and Principal Accounting Officer)              |  |                       



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