Chatham Lodging Trust Announces 2011 Distribution Characterization

The return of capital in 2011 was a significant component of the tax characterization due primarily to reductions in taxable income as a result of one-time non-recurring costs related to the Innkeepers investments in 2011, transaction costs related to the terminated Pittsburgh acquisition and increased depreciation as a result of the significant renovations performed in 2011.

No portion of the dividends declared in 2011 represented foreign taxes, capital gains or qualified dividend income. The CUSIP number for Chatham Lodging Trust common shares is 16208T102.

Record holders of Chatham Lodging Trust common shares who received any of the dividends specified in the table above will receive an Internal Revenue Service (IRS) Form 1099-DIV from Wells Fargo Bank, N.A., the company’s dividend paying agent. The Form 1099-DIV will report the dividends paid with respect to 2011. Shareholders whose shares are held in “street name” will receive an IRS Form 1099 from the bank, brokerage firm, or other nominee holding their shares.

The regular common share dividend declared on December 15, 2011 for shareholders of record as of December 30, 2011, and payable on January 27, 2012, will be reported on shareholders’ IRS Form 1099 for the 2011 tax year.

The information in the table above is based on the preliminary results of work on the tax filings of Chatham Lodging Trust and is subject to correction or adjustment when the filings are completed. No material change in these classifications is expected. The tax information above should not be construed as tax advice and is not a substitute for careful tax planning and analysis. Shareholders are encouraged to consult with their own tax advisors regarding the specific federal, state, local, foreign and other tax consequences of ownership of Chatham Lodging Trust’s common shares and the specific tax treatment of distributions on Chatham Lodging Trust’s common shares.

About Chatham Lodging Trust

Chatham Lodging Trust is a self-advised REIT that was organized to invest in upscale extended-stay hotels and premium-branded, select-service hotels. The company currently owns 18 hotels with an aggregate of 2,414 rooms/suites in 10 states and the District of Columbia and holds a minority investment in a joint venture that owns 64 hotels with 8,329 rooms/suites.

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