<PAGE>

                                                                    EXHIBIT 10.8

                                OWNER AGREEMENT
                                ---------------

          THIS OWNER AGREEMENT ("Agreement") is being entered into as of this
28/th/ day of September, 2001, by and between RESIDENCE INNS III LLC, a Delaware
limited liability company with a mailing address at 306 East Main Street,
Richmond, Virginia 23219 ("Lessor"); APPLE HOSPITALITY MANAGEMENT, INC., a
Virginia corporation with a mailing address at 9 North Third Street, Richmond,
Virginia 23219 ("Lessee"); and RESIDENCE INN BY MARRIOTT, INC., a Delaware
corporation with a mailing address at 10400 Fernwood, Bethesda, MD 20817
("Manager").

                                   RECITALS:

          WHEREAS, Lessor owns fee simple title to nine of the ten Inns,
currently operated under the trade name "Residence Inn" or "Residence Inn by
Marriott" or "Marriott Residence Inn," described on Exhibit A attached to this
                                                    ---------
Agreement and incorporated herein, and a leasehold interest in the Meriden,
Connecticut Residence Inn by Marriott hotel ("Meriden Inn") (these ten Inns
collectively referred to herein as the "Inns" or, individually, as an "Inn").

          WHEREAS, in connection with the acquisition of indirect ownership of
100% of the membership interests in Lessor by Apple Hospitality Two, Inc.
("Apple Hospitality"), Lessor has leased the Inns to Lessee, and Lessee has
leased the Inns from Lessor, pursuant to that certain lease attached hereto as
Exhibit B (the "Lease").
---------

          WHEREAS, Manager has operated and managed the Inns pursuant to that
certain Management Agreement dated as of December 29, 1999, by and between
Manager and Lessor (the "Original Management Agreement"), which operation and
management is subject to the following three letter agreements: (i) that certain
letter agreement dated December 29, 1999, by and between Seller and Manager,
with express acknowledgment by Crestline Capital Corporation ("Crestline") of
certain obligations it has under paragraphs 3 and 4 thereof; (ii) that certain
letter agreement dated December 29, 1999, by and between Crestline and Manager;
and (iii) that certain letter agreement dated September 11, 2000, by and between
Seller, Crestline, and Manager, each of which have been reviewed by Lessor and
Lessee.

          WHEREAS, pursuant to that certain Assignment and Assumption of
Management Agreement of even date hereof ("Assignment Agreement"), Lessor
assigned to Lessee the Original Management Agreement and the two letter
agreements described in clauses (i) and (iii) of the preceding recital
(collectively, the "Letter Agreements").

          WHEREAS, Manager has consented to such assignment by Lessor to Lessee
subject to, among other things: (i) Lessor guarantying the obligations of Lessee
under the Original Management Agreement and the Letter Agreements; (ii) Lessor
agreeing to grant certain protections to Manager in the event the Lease is
terminated for any reason; and (iii) Lessee
<PAGE>

meeting certain criteria, the satisfaction of which is confirmed by the
execution of this Agreement.

          WHEREAS, Lessee and Manager have executed by even date hereof an
Amended and Restated Management Agreement (hereinafter referred to, together
with the Letter Agreements, collectively as the "Management Agreement").

          NOW, THEREFORE, for the mutual covenants and considerations herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto intending to be
legally bound agree as follows:

          1.  Definitions.  Capitalized terms not specifically defined herein
              -----------
shall have the meaning provided in the Management Agreement.

          2.  Lessor Consideration.  Lessor hereby acknowledges that:  (i)
              --------------------
Lessor derives and expects to derive benefits from this Agreement, and (ii)
Lessor has determined that Lessor's execution, delivery and performance of this
Agreement directly benefit Lessor, are within the corporate purposes of Lessor,
and are in the best interest of Lessor.

          3.  Acknowledgement of Lease.  Manager hereby acknowledges and
              ------------------------
consents to the lease of Inns from Lessor to Lessee pursuant to the Lease in the
form attached hereto as Exhibit B.  The Lease shall not be construed to impose
                        ---------
any additional obligations or liabilities upon Manager, and shall not be
construed to modify or amend any of the rights and duties of the parties under
the Management Agreement.  To the extent that any of the provisions of the
Management Agreement impose a greater or inconsistent obligation on Lessee than
the corresponding provisions of the Lease, then Lessee shall be obligated to
comply with, and to take all actions necessary to prevent breaches or defaults
under, the relevant provisions of the Management Agreement.

          Manager acknowledges that Lessor and Lessee have, pursuant to the
terms of the Lease, agreed that Lessor shall pay, among other things (i) land,
building and personal property taxes and assessments applicable to the Inns,
(ii) premiums and charges for the casualty insurance coverages specified in the
Management Agreement (iii) expenditures for capital replacements, (iv)
expenditures for maintenance and repair of underground utilities and structural
elements of the Inns and (v) the payments of principal, interest and other sums
payable under the First Mortgage (collectively, "Ownership Costs").  Manager
shall have no duty, obligation or liability to Lessor or Lessee (i) to make any
determination as to whether any expense required to be paid by Manager hereunder
is an Ownership Cost or a cost of Lessee, (ii) to require that Ownership Costs
be paid from funds which can be identified as belonging to Lessor, or that other
costs and expenses required to be paid by Lessee be paid from funds which can be
identified as belonging to Lessee; it being the intent of the parties to this
Agreement that (i) Lessee and Lessor shall look only to each other and not to
Manager with respect to moneys that may be owed one to the other under the
Management Agreement and (ii) Manager need only look to Lessee to pay operating
costs of the Inns and other such obligations under the Management Agreement,
including, without limitation, those designated herein as Ownership Costs.

                                       2
<PAGE>

          4.  Lessor and Lessee Representations and Warranties.  Lessor and
              ------------------------------------------------
Lessee each hereby represents and warrants that Lessor currently maintains and
at all times in the future will maintain a direct or indirect (but at all times
a one-hundred percent) controlling and majority interest in Lessee.

          5.  Termination of the Lease.  The parties agree that the Management
              ------------------------
Agreement and the rights and benefits of Manager thereunder shall not be
terminated or disturbed in any respect except in accordance with the terms of
the Management Agreement, and not as a result of any termination of the Lease.
Accordingly, if the Lease is terminated for any reason, including, without
limitation, expiration of the term thereof or the "rejection" thereof following
Bankruptcy (as defined below) of Lessee (collectively, a "Lease Termination"),
Lessor:  (a) shall recognize Manager's rights under the Management Agreement,
(b) agrees that Manager shall not be named as a party in any eviction or other
possessory action or proceeding, and that Manager shall not be disturbed in its
right to manage the Inns pursuant to the Management Agreement, and (c) shall at
the time of or prior to such Lease Termination either (i) elect not to take
either of the actions described in clause (c)(ii) below, in which case all of
"Lessee's" rights, benefits, privileges and obligations under the Management
Agreement with respect to periods after the Lease Termination shall be assumed
directly by Lessor, or (ii) cause an "Approved Lessee" (as defined below) to (x)
succeed to and assume Lessee's rights and obligations under the Lease, the
Management Agreement, and this Agreement, or (y) enter into a new lease with
Lessor in substantially the same form as the Lease, and assume the rights and
obligations of the Lessee under the Management Agreement and this Agreement, the
intent being that the relationship between any successor Lessee, Lessor and
Manager be under the same terms and conditions as the relationship between
Lessee, Lessor and Manager hereunder and under the Management Agreement and the
Lease.  Any successor to Lessee under clause (c)(ii) above shall be subject to
Manager's prior written approval, which approval shall not be withheld or
delayed if such successor to Lessee is (i) a direct or indirect wholly-owned
subsidiary of Lessor, (ii) a person or entity to whom a Sale of the Inns is
permitted under Section 18.01(A)(2) of the Management Agreement, or (iii) a
person or entity who otherwise is approved by Manager in its sole discretion (an
"Approved Lessee").

          6.  Guaranty.  Lessor shall be liable for the complete and
              --------
satisfactory payment and performance of each and every obligation of Lessee as
"Lessee" under the Management Agreement (the "Guarantied Obligations").  Lessor
hereby absolutely, irrevocably, and unconditionally guaranties that the
Guarantied Obligations which are monetary obligations shall be paid when due and
payable and that the Guarantied Obligations which are performance obligations
shall be fully performed at the times and in the manner such performance is
required by the Management Agreement.  This guaranty is an absolute,
irrevocable, and unconditional guaranty of payment and performance and the
liability of Lessor hereunder shall be absolute and unconditional irrespective
of:  (i) any lack of validity, irregularity or enforceability of the Management
Agreement or this Agreement; (ii) any change in the time, manner, place or any
other term or condition of payments due under the Management Agreement or this
Agreement, or any other amendment or waiver of, or consent to, any departure
from the Management Agreement or this Agreement; (iii) any failure of Manager to
enforce the provisions of the

                                       3
<PAGE>

Management Agreement or this Agreement against Lessee; or (iv) any other
circumstances which might otherwise constitute a defense available to, or a
discharge of, of any of the Guarantied Obligations (other than because, or to
the extent, the same have been previously discharged in accordance with the
terms of the Management Agreement). If all or any part of the Guarantied
Obligations shall not have been paid when due and payable or performed at the
time performance is required, Lessor (without first requiring the Manager to
proceed against Lessee or any other party or any other security) shall pay or
cause to be paid to Manager the amount thereof as is then due and payable and
unpaid (including interest and other charges, if any, due thereon through the
date of payment in accordance with the applicable provisions of the Management
Agreement) or perform or cause to be performed such obligations in accordance
with the Management Agreement, within ten (10) Business Days after receipt of
written notice from the Manager of the failure by Lessee to make such payment or
render such performance; provided, however, that, notwithstanding the foregoing,
Lessor shall have the right, in connection with a demand by Manager for payment
by Lessor of Guaranteed Obligations, to assert any defenses or claim of Lessee
under the Management Agreement with respect to such Guaranteed Obligations. If
for any reason Lessor fails to perform or cause to be performed such
obligations, Manager shall have the right to exercise any and all of the
remedies available at law or in equity and Lessor hereby agrees to pay any and
all reasonable expenses (including counsel fees and expenses) incurred by
Manager in enforcing its rights under this Agreement. The guaranty contained in
this Agreement: (i) is a continuing guaranty and shall remain in full force and
effect until the indefeasible satisfaction and discharge in full of Lessee's
obligations as "Lessee" under the Management Agreement and Lessor's and Lessee's
obligations under this Agreement, and (ii) shall continue to be effective or
shall be reinstated, as the case may be, if at any time any payment under the
Management Agreement or this Agreement becomes unrecoverable from Lessee by
operation of law or for any other reason or must otherwise be returned by
Manager upon the insolvency, bankruptcy or reorganization of Lessor or Lessee.

          7.  Obligation to Terminate Lease Upon Lessee Default under Management
              ------------------------------------------------------------------
Agreement.  Upon receiving a written request from Manager to do so (and provided
---------
that Manager has sent to Lessor a notice as described in Section 5 above with
respect to the applicable Default), Lessor shall terminate the Lease if an Event
of Default by Lessee has occurred under the Management Agreement.  In
terminating the Lease pursuant to this Section 7, Lessor shall issue its notice
of termination to Lessee promptly following its receipt of Manager's request
therefor. Lessor shall thereafter promptly initiate, and thereafter diligently
and continuously prosecute, such actions as may be required to confirm such
Lease termination and repossess the Inns, including, without limitation,
instituting such legal action as may be necessary to accomplish same. Upon
Lessor's termination of the Lease in accordance with this Section 7, Lessor
shall thereupon be obligated to comply with the provisions of Section 5
applicable upon a Lease Termination.

          8.  Agreements Relating to Tenancy.  In order to address the fact that
              -------------------------------
Lessee's interest in the Site and the Inns is leasehold, and to address certain
other related matters, the parties agree to the following modifications of the
Management Agreement, to be effective for so long as Lessee's interest in the
Site and Inns is held through tenancy and subtenancy title as that of Lessee:

                                       4
<PAGE>

          A.  Modifying the provisions of Section 3.01 of the Management
Agreement, Lessor and Lessee covenant and agree, and Manager acknowledges, that:
(i) Lessor holds, and shall have, keep and maintain throughout the term of the
Management Agreement, good and marketable fee title to the Inns and Site (except
the Meriden Inn, which is addressed separately herein); (ii) Lessee holds, and
shall have, keep and maintain throughout the term of the Management Agreement,
leasehold title to the Inns and Site (except the Meriden Inn, which is addressed
separately herein), in each case free and clear of any and all liens,
encumbrances or other charges, except for those specifically set forth in
Section 3.01.A. of the Management Agreement; and (iii) Lessor holds, and shall
have, keep, and maintain throughout the term of the Management Agreement, a
leasehold interest to the Meriden Inn and Site upon which it is located pursuant
to that certain Land Lease dated April 15, 1988, as amended by First Amendment
and Modification to Land Lease dated September 15, 1988, Second Amendment to
Land Lease dated October 24, 1988, Third Amendment and Modification to Land
Lease dated November 21, 1991, as assigned by interim assignment dated December
30, 1991 and assignment to Lessor dated December 29, 1999, and that such
leasehold interest is free and clear of any all liens, encumbrances or other
charges, except for the Lease of the Inns to Lessee and those specifically set
forth in Section 3.01(A) of the Management Agreement.

          B.  Modifying the definition of "Sale of the Inns," the parties agree
that such term shall refer also (i.e., in addition to the events described
within the definition of such term as it may apply to Lessee's and Lessor's
interest in the Site) to any assignment of the Lease or sublease of the Inns or
the Site by Lessee, other than as expressly permitted in the Management
Agreement or in this Agreement. In connection with any such Sale of the Inns,
Lessor and Lessee agree that an agreement in form and substance similar to this
Agreement will be required from the assignee or sublessee, in order to ensure
that Manager will incur no greater liability, cost or risk of termination of the
Management Agreement as a result of such assignment or sublease.

          C.  If Lessor hereafter encumbers the Site and/or the Inns with a
Mortgage, the Subordination Agreement required in Article XVII of the Management
Agreement with respect to such Mortgage shall be modified (i) to account for the
facts that Lessor (rather than Lessee) has encumbered the Site and/or the Inns
with such Mortgage and that, and (ii) to provide that the parties' rights and
obligations under such Subordination Agreement shall, as applicable, apply to
both the Management Agreement and this Agreement.

                                       5
<PAGE>

          9.   Additional Lessor Obligations.
               -----------------------------

          A.   Lessor agrees to fully and timely comply with all notice
requirements set forth in Section 18.01 of the Management Agreement on each
occasion that Lessor receives a bona fide written offer to purchase or lease any
one or more of the Inns that it desires to accept. Lessor further acknowledges
and agrees that any failure by Lessor to timely provide notice to Manager as set
forth in Section 18.01 of the Management Agreement with respect to a bona fide
written offer to purchase or lease any one or more of the Inns shall extinguish
any right of Lessor to enter such sale or lease.

          B.   Lessor agrees, where applicable, upon request by Manager, not to
unreasonably withhold, condition or delay the prompt signing, without charge, of
applications for licenses, permits or other instruments necessary for operation
of each Inn, which applications shall be prepared by Manager as necessary from
time to time.

          10.  Certain Provisions Regarding Bankruptcy.  In the event the Lease
               ---------------------------------------
shall be rejected on behalf of Lessor under Section 365 of the United States
Bankruptcy Code ("Code") or any other applicable law or authority ("Rejection"),
Lessee shall promptly notify Manager in writing of such Rejection and Lessee
shall, as directed by Manager, either treat the Lease as terminated by such
Rejection or retain its rights under the Lease as permitted by the Code or other
applicable law or authority.  In the event the Management Agreement is
terminated as a result of Rejection on behalf of Lessee, the Management
Agreement will remain effective with respect to Lessor, and Lessor shall, if
directed by Manager (but only to the extent such right may be exercised under
the Code or other applicable law and authority), terminate the Lease, subject to
the provisions of Section 5 hereof.  Lessor and Lessee each agree that it will
not join in any involuntary petition against the other under the Code or any
other similar federal or state law providing for debtor relief, without the
consent of Manager.

          11.  Term.  The term of this Agreement shall commence on the date set
               ----
forth above and shall run concurrently with the term of the Management
Agreement.

          12.  Required Assignment.  In connection with any Sale of the Inns
               -------------------
which includes a transfer of Lessor's and/or Lessee's title in the Site and/or
the Inns, Lessor and Lessee agree that the successors to their respective titles
in the Site and/or the Inns shall also assume their respective rights and
obligations under this Agreement and shall cause such successor(s) to assume
such rights and obligations pursuant to an assumption of this Agreement
reasonably acceptable to Manager.

          13.  Notices.  All notices and other communications provided for
               -------
hereunder shall be in writing, and shall be sent or delivered by the methods and
to the addresses for Lessor, Lessee and Manager as required under the Management
Agreement.

          14.  Eligible Independent Contractor.  Manager agrees that, as of the
               -------------------------------
date hereof, it is an eligible independent contractor under Section 856(d) of
the Internal Revenue Code, and further agrees that it shall maintain such status
to the extent it is able to do so, acknowledging

                                       6
<PAGE>

that events outside of Manager's control may result in an overlap of ownership
between Manager and Lessor or Lessee which could affect Manager's independent
contractor status. Lessor, Manager and Lessee agree to cooperate in good faith
to ensure that Manager retains such status. This covenant shall apply for so
long as the Inns are owned by Lessor (or another direct or indirect wholly-owned
subsidiary of Apple Hospitality pursuant to a permitted assignment) and leased
to Lessee (or another direct or indirect wholly-owned subsidiary of Apple
Hospitality pursuant to a permitted assignment ) as part of an ownership
structure that is subject to REIT tax requirements.

          15.  Miscellaneous.
               -------------

          A.   Modification of this Agreement.  No amendment, modification,
               ------------------------------
alteration or waiver of any provision of this Agreement shall be effective
unless it is in writing and signed by the party against whom enforcement of such
amendment is sought, and no waiver of any provision of this Agreement by any
party hereto, and no consent to any departure therefrom by any party hereto,
shall be effective unless it is in writing and signed by the party against whom
enforcement of such waiver or consent is sought, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.

          B.   No Waiver. No failure by any party hereto to exercise, and no
               ---------
delay in exercising, any right under the Management Agreement or this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right preclude any other or further exercise thereof or the exercise of any
other right.

          C.   Remedies Cumulative.  The rights and remedies of any party hereto
               -------------------
provided in the Management Agreement and this Agreement are cumulative and are
in addition to, and not exclusive of, any rights or remedies provided by law or
equity.

          D.   Governing Law. This Agreement shall be governed by and construed
               -------------
in accordance with the laws of the State of Maryland.

          E.   Severability. The invalidity, illegality or unenforceability of
               ------------
any one or more phrases, sentences, clauses or sections contained in this
Agreement shall not affect the validity, legality or enforceability of the
remaining portions of this Agreement.

          F.   Entire Agreement.  This Agreement, together with the Management
               ----------------
Agreement (including the Letter Agreements), Assignment Agreement (defined
herein), and the Lease, constitutes the entire agreement and supersedes all
prior agreements and understandings, both written and oral, between the parties
hereto with respect to the subject matter hereof and may be executed
simultaneously in several counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

          G.   Successors and Assigns.  The parties hereto shall not assign or
               ----------------------
transfer or permit the assignment or transfer of this Agreement without the
prior written consent of the other parties hereto, except that Lessee and
Manager shall each have the right and obligation to assign its

                                       7
<PAGE>

respective interest in this Agreement to any party to which its respective
interest in the Management Agreement may be assigned under the terms of the
Management Agreement, and Lessor shall have the right and obligation to assign
its interest in this Agreement to any party to which its interest in the Site
and Inn may be assigned, subject to the requirements of the Management
Agreement.

     H.   Captions.  The captions and headings of the sections and subsections
          --------
of this Agreement are for purposes of convenience and reference only and shall
not limit or otherwise affect the meaning hereof.

     I.   Time of the Essence.  Time shall be of the essence in the performance
          -------------------
of this Agreement.

     J.   Incorporation of Recitals.  The recitals hereto are incorporated
          -------------------------
herein as part of this Agreement.

     K.   Counterparts - This Assignment may be executed in counterparts, each
          ------------
of which, taken together with the others, shall constitute the original.

                       [SIGNATURES FOLLOW ON NEXT PAGE]

                                       8
<PAGE>

          IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement under seal as of the date first written above.

                         LESSOR:

                         RESIDENCE INN III LLC,
                         a Delaware limited liability company



                         By:   /s/ Glade M. Knight
                             ------------------------------
                         Name:  Glade M. Knight
                               ----------------------------
                         Title:   President
                                ---------------------------


                         LESSEE:

                         APPLE HOSPITALITY MANAGEMENT, INC.,
                         a Virginia corporation



                         By:   /s/ Glade M. Knight
                             ------------------------------
                         Name:  Glade M. Knight
                               ----------------------------
                         Title:   President
                                ---------------------------

                         MANAGEMENT COMPANY:

                         RESIDENCE INN BY MARRIOTT, INC.,
                         a Delaware corporation,



                         By:  /s/ Joel M. Eisenmann
                             ------------------------------
                         Name:  Joel M. Eisenmann
                               ----------------------------
                         Title: Vice President
                               ----------------------------

                                       9
<PAGE>

                                   EXHIBIT A

                                   [omitted]
<PAGE>

                                   EXHIBIT B

                                   [omitted]