RFS Appoints Karl Matthies To Board of Directors

Press Release: RFS Hotel Investors Inc.
August 7, 2001
MEMPHIS, TN -- RFS Hotel Investors, Inc. (NYSE: RFS) yesterday announced that Karl Matthies has been elected to the Company's Board of Directors. Matthies is president of Bellagio Partners, a private investment management and consulting company. Prior to forming Bellagio, he was the Senior Partner in charge of Consumer & Real Estate Investment Banking at Banc of America Securities. He was a founding member of Montgomery Securities, Banc of America Securities' predecessor firm, where he held a variety of positions from 1971-1999.

Robert Solmson, RFS chairman & CEO, said, ``We are delighted to have Karl join our board of directors. I have worked with Karl for several years in his former capacity as a principal and senior banker with Montgomery Securities. He is an astute investor with a keen insight into the lodging industry.''

RFS Hotel Investors, Inc. (RFS) is a real estate investment trust (REIT) that owns 58 hotels with approximately 8,400 rooms located in 24 states. RFS's hotel portfolio is diversified by geography, brand and segment. Leading brands under which RFS hotels are operated include Sheraton®, Residence Inn by Marriott®, Hilton®, Doubletree®, Holiday Inn®, Hampton Inn®, and Homewood Suites by Hilton®. By segment, RFS receives approximately 47% of its EBITDA from full service hotels, 30% from extended stay hotels and 23% from limited service hotels. Additional information can be found on the Company's website at www.rfshotel.com.

Certain matters within this press release are discussed using forward-looking language as specified in the 1995 Private Securities Litigation Reform Law, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. From time to time, these risks are discussed in the Company's filings with the Securities and Exchange Commission.

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Contact: 

     Mimi Hall Communications Inc., Memphis
     Mimi Hall, 901/682-1360