Lease

First Amendment to Lease

by Winston Hotels
December 11th, 1997

                                                    EXHIBIT 10.3


                     FIRST AMENDMENT TO  LEASE

     THIS FIRST AMENDMENT TO LEASE (this "First Amendment to
Lease"), made as of the 24th day of November, 1997, by and between
WINN LIMITED PARTNERSHIP, a North Carolina limited partnership and
WINSTON HOTELS, INC., a North Carolina corporation (hereinafter
called "Lessor"), and CAPSTAR WINSTON COMPANY, L.L.C., a Delaware
limited liability company (hereinafter called "Lessee"), provides
as follows:

                       W I T N E S S E T H:

     WHEREAS, pursuant to that certain Asset Purchase Agreement
dated as of October 29, 1997 (the "Purchase Agreement") by and
among WINSTON HOSPITALITY, INC. ("Winston"), ROBERT W. WINSTON, III
and JOHN B. HARRIS ("Winston Shareholders"), CAPSTAR MANAGEMENT
COMPANY, L.P., a Delaware limited partnership ("CapStar") and
CAPSTAR HOTEL COMPANY, a Delaware corporation ("CapStar Corp."),
Winston has assigned to CapStar and CapStar has assigned to Lessee
all of its right, title and interest in 6 separate lease agreements
listed on Exhibit A attached hereto and incorporated herein by this
reference (individually, "Existing Lease" and collectively,
"Existing Leases");

     WHEREAS, Lessee is an indirect subsidiary of CapStar Corp.
and, as such, is experienced in the management and operations of
facilities substantially similar to the hotel properties leased
pursuant to the Existing Leases; and

     WHEREAS, Lessor (in consideration of the foregoing recital)
has consented to the assignment of the Existing Leases from Winston
to CapStar and from CapStar to Lessee, and Lessor and Lessee have
agreed to amend the Existing Leases in accordance with the terms of
this First Amendment to Lease.
     
     NOW, THEREFORE, in consideration of the payment of rent and
the mutual agreements set forth herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, Lessor and Lessee hereby amend the Existing Leases as
follows:

1.   The definition of "Base Rate" is hereby modified by inserting
     "prime" before "rate" on the first line thereof and by
     deleting "as such bank's base rate" from the second line
     thereof.

2.   Section 1.2 is hereby modified by substituting "[November 30,
     2012]" in lieu of "tenth anniversary of the last day of the
     month in which the Commencement Date occurs" in the second and
     third lines thereof.

3.   The definition of "Gross Operating Profit" is hereby amended
     by adding the following to the end of the definition:
     
          No part of Lessee's central office overhead or
          general or administrative expense (as opposed
          to that of the Facility) shall be deemed to be
          a part of Gross Operating Expenses, as herein
          provided; provided that accounting services
          provided to the Leased Property but performed
          at Lessee's central office shall be included in
          Gross Operating Expenses.

Page 2

4.   Section 3.2 is hereby modified by adding the term "and
     franchise reports" after the term "excise tax returns" on the
     twelfth line thereof.

5.   Sections 3.6 and 3.7 are hereby deleted and the following is
substituted in lieu thereof:

          3.6  Annual Budget.  Not later than forty-five
          (45) days prior to the commencement of each
          Fiscal Year, Lessee shall submit the following
          Budgets to Lessor:

               (a)  An operating budget ("Operating
          Budget") prepared in accordance with this
          Section 3.6(a), in substantially the form
          attached hereto as Exhibit E. The Operating
          Budget shall be prepared in good faith and
          otherwise in accordance with the Uniform System
          to the extent applicable and shall show by
          month and quarter and for the full Fiscal Year
          in the degree of detail specified by the
          Uniform System, the following:

                    (i)  Lessee's reasonable estimate of
               Gross Revenues (including room rates and
               Room Revenues, food, beverage and other
               revenues as applicable), Gross Operating
               Expenses, and Gross Operating Profits for
               the forthcoming Fiscal Year itemized on
               schedules on a quarterly basis as approved
               by Lessor and Lessee, as same may be
               revised or replaced from time to time by
               Lessee and approved by Lessor, together
               with the assumptions, in narrative form,
               forming the basis of such schedules.

                    (ii) A reasonable estimate of the
               amounts to be dedicated to routine, non-
               capital repair and maintenance; and

                    (iii)     A cash flow projection.

                    (iv) Lessee's reasonable estimate of
               Percentage Rent by quarter for the Fiscal
               Year, and

                    (v)  A narrative description of the
               program for advertising and marketing the
               Facility for the forthcoming Fiscal Year
               containing a detailed budget itemization
               of the proposed advertising expenditures
               by category and the assumptions, in
               narrative form, forming the basis of such
               budget itemizations.

               (b)  A capital budget ("Capital Budget")
          in substantially the form of Exhibit F hereto
          (which shall not exceed five percent (5%) of
          the estimated Room Revenues except to the
          extent otherwise required in Article XXXIX),
          containing a description in reasonable
Page 3

          detail of the proposed Capital Improvements and
          an estimate of all amounts Lessor will be
          requested to provide for Capital Improvements
          to the Facility or any of its components for
          the Fiscal Year.  The Capital Budget shall be
          prepared in accordance with the Uniform System
          to the extent applicable.

          3.7  Approval of Capital Budget.  Within thirty
          (30) days following submission of the Capital
          Budget to Lessor, Lessor shall give Lessee
          written notice either (a) that Lessor approves
          the Capital Budget or (b) indicating with
          reasonable specificity the respects in which
          Lessor objects to the Capital Budget.  In the
          latter event, Lessor and Lessee shall act
          promptly, reasonably and in good faith to seek
          to resolve Lessor's objections.  In the event
          Lessor fails to deliver the notice set forth in
          this section, within the required time period,
          the Capital Budget shall be deemed approved.
          Lessee, in its sole discretion, may designate
          proposed capital projects as "mandatory"
          projects in an aggregate amount not in excess
          of twenty-five percent (25%) of the Capital
          Budget, which mandatory projects shall not be
          subject to Lessor's approval.  In the event
          that Lessor and Lessee fail to reach agreement
          with respect to the Capital Budget within
          thirty (30) days after receipt of Lessor's
          written notice, Lessee and Lessor shall refer
          any disputed Capital Budget matter to
          arbitration using procedures set forth in
          Article XL hereto and each party shall endeavor
          to cause such arbitration to be completed as
          quickly as possible, but in any event not later
          than six (6) months following referral to
          arbitration. While any arbitration is pending,
          Lessee shall continue to operate the Facility
          in accordance with the terms of this Lease,
          including without limitation, making all
          Capital Expenditures for approved portions of
          the Capital Budget and mandatory projects to
          the extent such mandatory projects are included
          in the Capital Budget.  Lessor shall be
          obligated to make all Capital Expenditures
          which are required pursuant to a Capital Budget
          which has been approved or deemed approved in
          accordance with the procedures set forth above.

          3.8  Approval of Annual Budget.  Within thirty
          (30) days following submission of the Annual
          Budget to Lessor, Lessor shall give Lessee
          written notice either (a) that Lessor approves
          the Annual Budget or (b) indicating with
          reasonable specificity the respects in which
          Lessor objects to the Annual Budget.  In the
          latter event, Lessor and Lessee shall act
          promptly, reasonably and in good faith to seek
          to resolve Lessor's objections.  In the event
          that Lessor and Lessee fail to reach agreement
          with respect to the Annual Budget within thirty
          (30) days after receipt of Lessor's written
          notice, Lessee and Lessor shall refer any
          disputed Annual Budget matter to arbitration
          using procedures set forth in Article XL hereto
          and each party shall endeavor to cause such
          arbitration to be completed as 

Page 4

          quickly as possible, but in any event not later
          than six (6) months following referral to
          arbitration.

          3.9  Capital Projects.

               (a)  The selection of all design
          professionals and contractors for material
          capital projects (i.e., in excess of $25,000)
          shall be made by Lessor in its reasonable
          discretion, after consultation with Lessee.

               (b)  Lessor may require that all contracts
          in connection with capital projects be subject
          to competitive bidding procedures reasonably
          acceptable to Lessor.  Lessor shall also have
          the right to review and approve all material
          contract bids (i.e., in excess of  $25,000)
          whether competitively bid or not.  Lessor may
          also retain, at its sole cost and expense, an
          inspecting architect or engineer to monitor
          costs, time, quality and performance for all
          capital projects.

          3.10 Books and Records.  Lessee shall keep full
          and adequate books of account and other records
          reflecting the results of operation of the
          Facility on an accrual basis, all in accordance
          with the Uniform System and generally accepted
          accounting principles to the extent applicable
          and the obligations of Lessee under this Lease.
          The books of account and all other records
          relating to or reflecting the operation of the
          Facility shall be kept either at the Facility
          or at Lessee's offices in Raleigh, North
          Carolina and shall be available to Lessor and
          its representatives and its auditors or
          accountants, at all reasonable times for
          examination, audit, inspection, and
          transcription.  All of such books and records
          pertaining to the Facility including, without
          limitation, books of account, guest records and
          front office records, at all times shall be the
          property of Lessor and shall not be removed
          from the Facility or Lessee's offices without
          Lessor approval.

6.   Article IV is hereby amended by adding the following as
Section 4.6:

          4.6  Franchise Fees.  Lessee will pay or cause
          to be paid in a timely manner all franchise
          fees due and owing in accordance with the terms
          and conditions of the Franchise Agreement.
     
7.   The last sentence of Section 5.2 is hereby deleted and the
     following is substituted in lieu thereof:
     
          If Lessor and Lessee are unable to agree upon
          the amount of such abatement within 30 days
          after such partial Taking, the matter may be
          submitted by either party to arbitration
          pursuant to the arbitration procedures set
          forth in Article XL.

8.   The sentence prior to the final sentence of Section 6.2 is
     hereby deleted and the following is substituted in lieu
     thereof:

Page 5

          Upon the expiration or earlier termination of
          the Term, Lessor or its designee shall retain
          ownership of "par stock" (as such term is
          generally used within the hotel industry) of
          Inventory and shall have the option to purchase
          all Inventory on hand at the Leased Property at
          the time of such expiration or termination in
          excess of par stock for a sale price equal to
          the fair market value of such Inventory.

9.   Section 7.2(f) is hereby deleted and the following is
     substituted in lieu thereof:

               (f)  Lessee agrees to deliver to Lessor
          upon request by Lessor from time to time a list
          of hotels and motels (and locations) owned or
          managed by Lessee and its Affiliates.

               (g)  During the Term, neither Lessee nor
          any Affiliate of Lessee that is "controlled" by
          CapStar (i.e., CapStar owns, directly or
          indirectly, fifty percent (50%) or more of the
          ownership interests in such entity or has the
          ability to direct management of such entity)
          ("Controlled Affiliate") shall build or develop
          a hotel, motel, inn or other lodging facility
          within five (5) miles of, and in direct
          competition with, the Leased Property, (i.e.,
          such lodging facility is substantially similar
          to the Leased Property with respect to level of
          services provided, market segment and price
          point).   In the event that Lessee or a
          Controlled Affiliate acquires, owns, operates
          or manages a hotel, motel, inn or other lodging
          facility within five (5) miles of the Leased
          Property,  Lessee agrees that, during the Term,
          neither it nor its Controlled Affiliate will
          solicit on a targeted basis any executive or
          managerial employees or material customer
          accounts of the Leased Property.

10.  Article XIV is hereby deleted and the following is
substituted in lieu thereof:

          14.1 Insurance Proceeds.  Subject to the
          provisions of Section 14.5, all proceeds
          payable by reason of any loss or damage to the
          Leased Property, or any portion thereof, and
          insured under any policy of insurance required
          by Article XIII of this Lease shall be paid to
          Lessor and shall be made available, in
          accordance with this Article, for
          reconstruction or repair, as the case may be,
          of any damage to or destruction of the Leased
          Property, or any portion thereof, and, if
          applicable, shall be paid out by Lessor from
          time to time for the reasonable costs of such
          reconstruction or repair upon satisfaction of
          reasonable terms and conditions specified by
          Lessor.

          14.2 Reconstruction in the Event of Damage or
          Destruction Covered by Insurance.

               (a)  If the Leased Property is totally or
          partially destroyed by a risk covered by the
          insurance described in Article XIII and the

Page 6

          Facility thereby is rendered Unsuitable for its
          Primary Intended Use, Lessor may, at Lessor's
          option to be exercised within ninety (90) days
          after the date of such occurrence, restore the
          Facility to substantially the same condition as
          existed immediately before the damage or
          destruction and otherwise in accordance with
          the terms of the Lease.

               (b)  If the Leased Property is partially
          destroyed by a risk covered by the insurance
          described in Article XIII, but the Facility is
          not thereby rendered Unsuitable for its Primary
          Intended Use, Lessor shall promptly restore the
          Facility to substantially the same condition as
          existed immediately before the damage or
          destruction and otherwise in accordance with
          the terms of the Lease to the extent of
          insurance proceeds received by Lessor.

          14.3 Lessee's Property.  All insurance proceeds
          payable by reason of any loss of or damage to
          any of Lessee's Personal Property shall be paid
          to Lessee; provided, however, no such payments
          shall diminish or reduce the insurance payments
          otherwise payable to or for the benefit of
          Lessor hereunder.

          14.4 Abatement of Rent.  Any damage or
          destruction due to casualty notwithstanding,
          this Lease shall remain in full force and
          effect and Lessee's obligation to make rental
          payments and to pay all other charges required
          by this Lease shall remain unabated during the
          first six months of any period required for the
          applicable repair and restoration. Thereafter,
          Base Rent shall be equitably abated.

          14.5 Damage Near End of Term. If damage to or
          destruction of the Facility rendering it
          Unsuitable for its Primary Intended Use occurs
          during the last 24 months of the Term, then
          Lessor shall have the right to terminate this
          Lease by giving written notice to Lessee within
          30 days after the date of damage or
          destruction, whereupon all accrued Rent shall
          be paid immediately, and this Lease shall
          automatically terminate five days after the
          date of such notice.

          14.6 Waiver. Lessee hereby waives any statutory
          rights of termination that may arise by reason
          of any damage or destruction of the Facility
          that Lessor is obligated to restore or may
          restore under any of the provisions of this
          Lease.

11.  Section 15.3 is hereby modified by deleting "subject to the
     provisions of Section 15.7," from the second line thereof and
     by deleting the last sentence thereof.

12.  Section 15.5 is hereby modified by substituting "Lessor" in
     lieu of "Lessee" in the fourth line thereof and by deleting
     the last sentence thereof.


Page 7


13.  Section 15.6 is hereby modified by substituting "Lessor" in
     lieu of "Lessee" in both instances where it appears on the
     thirteenth line thereof by deleting the parenthetical phrase
     "(subject to Lessor's contributions as set forth below)" where
     it appears on the fifteenth line, and by deleting the last
     sentence thereof.

14.  Article 15 is hereby modified by deleting Section 15.7
     therefrom.

15.  Section 16.1 is hereby deleted and the following is
substituted in lieu thereof:

          16.1 Events of Default.  If any one or more of
          the following events (individually, an "Event
          of Default") occurs:

               (a)  if an Event of Default occurs under
          any other lease between Lessor and Lessee any
          Controlled Affiliate; or

               (b)  if Lessee fails to make payment of
          the Base Rent, Percentage Rent or Additional
          Charges within fifteen (15) days after the same
          becomes due and payable; or

               (c)  if Lessee fails to observe or perform
          any other term, covenant or condition of this
          Lease and such failure is not cured by Lessee
          within a period of thirty (30) days after
          receipt by such party of Notice thereof from
          Lessor, unless such failure cannot with due
          diligence be cured within a period of thirty
          (30) days, in which case it shall not be deemed
          an Event of Default if Lessee proceeds promptly
          and with due diligence to cure the failure and
          diligently completes the curing thereof
          provided, however, in no event shall such cure
          period extend beyond 90 days after such Notice
          (provided that no Event of Default shall be
          deemed to have occurred pursuant to this
          subsection (c) to the extent that Lessee's
          failure to observe or perform any term,
          covenant or condition of this Lease is caused
          by Lessor's failure to fulfill its obligations
          under this Lease); or
               
               (d)  if there occurs a transfer of a
          controlling interest in Lessee (50% or more of
          the ownership interests in Lessee) without the
          prior consent of Lessor, which may be withheld
          in Lessor's sole discretion, subject to
          Section 23.1 as modified hereby; or

               (e)  if Lessee shall file a petition in
          bankruptcy or reorganization for an arrangement
          pursuant to any federal or state bankruptcy law
          or any similar federal or state law, or shall
          be adjudicated a bankrupt or shall make an
          assignment for the benefit of creditors or
          shall admit in writing its inability to pay its
          debts generally as they become due, or if a
          petition or answer proposing the adjudication
          of Lessee as a bankrupt or its reorganization
          pursuant to any federal or state bankruptcy law
          or any similar federal or state law shall be
          filed in any court and Lessee shall be

Page 8


          adjudicated a bankrupt and such adjudication
          shall not be vacated or set aside or stayed
          within sixty (60) days after the entry of an
          order in respect thereof, or if a receiver of
          the Lessee of the whole or substantially all of
          the assets of the Lessee shall be appointed in
          any proceedings brought by the Lessee or if any
          such receiver, trustee or liquidator shall be
          appointed in any proceeding brought against
          Lessee shall not be vacated or set aside or
          stayed within sixty (60) days after such
          appointment; or

               (f)  if Lessee is liquidated or dissolved,
          or begins proceedings toward such liquidation
          or dissolution, or, if Lessee in any manner,
          permits the sale or divestiture of
          substantially all of its assets; or

               (g)  if the estate or interest of Lessee
          in the Leased Property or any part thereof is
          voluntarily or involuntarily transferred,
          assigned, conveyed, levied upon or attached in
          any proceeding (unless Lessee is contesting
          such lien or attachment in good faith in
          accordance with this Lease); or

               (h)  if, except as a result of damage,
          destruction or a partial or complete
          Condemnation, Lessee voluntarily ceases
          operations on the Leased Property for a period
          in excess of thirty (30) days; or

               (i)  if an event of default has been
          declared by the franchisor under the Franchise
          Agreement with respect to the Facility on the
          Leased Property as a result of any action or
          failure to act by the Lessee or any other
          person with whom Lessee contracts for
          management services at the Facility, other than
          a failure to complete improvements required by
          the franchisor  because Lessor has not provided
          funds for such improvements to the extent
          required pursuant to this Lease; or

               (j)  the occurrence of an Event of Default
          under the Guarantee of Lease executed by
          CapStar Corp. in favor of Lessor with respect
          to Lessee's obligations under this Lease.

               Then, and in any such event, Lessor may
          exercise one or more remedies available to it
          herein or at law or in equity, including but
          not limited to its right to terminate this
          Lease giving Lessee not less than ten (10)
          days' notice of such termination.

               If litigation is commenced with respect to
          any alleged default under this Lease, the
          prevailing party in such litigation shall
          receive, in addition to its damages incurred,
          such sum as the court shall 

Page 9

          determine as its reasonable attorneys' fees, and 
          all costs and expenses incurred in connection 
          therewith.

16.  Section 19.6 is hereby deleted and the following is
substituted in lieu thereof:

          19.6 Payments to Affiliates of Lessee.
          Notwithstanding anything to the contrary
          contained in this Lease, Lessee shall make no
          payments to Affiliates unless expressly set
          forth in the Annual Budget (which may provide
          for payment of management fees to an Affiliate
          of Lessee) or otherwise expressly agreed to in
          writing by Lessor, in either case, after full
          written disclosure (including information
          regarding competitive pricing) by Lessee to
          Lessor of the affiliation and any other related
          information requested by Lessor.

          19.7 Management Agreement.  Lessor shall have
          the right in its sole and absolute discretion
          to approve or disapprove in advance any manager
          or proposed manager (a "Manager") of the
          Facility which is not an Affiliate of Lessee,
          as well as any agreement relating to the
          management or operation of the Facility (a
          "Management Agreement") by a Manager which is
          not an Affiliate of Lessee and Lessee will
          provide Lessor with an executed copy of any
          Management Agreement so approved by Lessor.
          Any Management Agreement (whether with a
          Manager which is an Affiliate or is not an
          Affiliate of Lessee) must provide that (i) upon
          termination of this Lease or termination of
          Lessor's or Lessee's right to possession of the
          Leased Property for any reason, the Management
          Agreement may be terminated by Lessor without
          liability for any payment due or to become due
          to the Manager thereunder; (ii) any management
          fees shall be subordinated to payments of Rent
          to Lessor hereunder; and (iii) in the event
          Lessee is in default, the Manager shall, at the
          election of Lessor and provided the Manager
          continues to be paid, continue to perform under
          the terms of the Management Agreement for a
          period not to exceed ninety (90) days.  No fees
          or other amounts payable by Lessee to any
          Manager shall excuse Lessee from its
          obligations to pay Rent and other amounts
          payable by Lessee to Lessor hereunder.  No
          Management Agreement may be amended or modified
          in any manner which materially affects the
          subordination of the management fees without
          the prior written consent of Lessor.

17.  Article XXII is hereby amended by adding the
     following paragraphs thereto:

     Add immediately following the first paragraph:

               Without limiting the generality of the
          foregoing paragraph, Lessee shall indemnify,
          save harmless and defend Lessor Indemnified
          Parties (including, but not limited to, any
          Lessor Indemnified Party that is a guarantor of
          the Franchise Agreement pursuant to which the
          Leased Property is currently operated)
          ("Current Franchise Agreement") from and
          against all liabilities,

Page 10

          obligations, claims, damages, penalties, causes
          of action, costs and expenses (including, but not 
          limited to, transfer fees and termination fees)
          imposed upon or incurred by or asserted against Lessor
          Indemnified Parties under or with respect to
          the Current Franchise Agreement which arises as
          a result of (a) any default by Lessee under the
          terms of this Lease; or (b) any default by
          Lessee under the Current Franchise Agreement.

     Add immediately following the second paragraph:

               Without limiting the generality of the
          foregoing paragraph, Lessor shall indemnify,
          save harmless and defend Lessee Indemnified
          Parties (including, but not limited to, any
          Lessee Indemnified Party that is a guarantor of
          the Current Franchise Agreement) from and
          against all liabilities, obligations, claims,
          damages, penalties, causes of action, costs and
          expenses (including, but not limited to,
          transfer fees and termination fees) imposed
          upon or incurred by or asserted against Lessee
          Indemnified Parties under or with respect to
          the Current Franchise Agreement which arises as
          a result of (a) any default by Lessor under the
          terms of this Lease; (b) the sale by Lessor of
          the Leased Property or any interest of Lessor
          in the Leased Property; or (c) any act or
          omission of any person that acquires the Leased
          Property or any interest of Lesser in the
          Leased Property.

18.  Section 23.1 is hereby modified by adding the following to the
end of Section 23.1:

          Notwithstanding the foregoing, Lessor's prior
          consent is not required for assignments of this
          Lease in connection with a "change of control"
          transaction involving CapStar or CapStar Corp.
          (i.e.,  a merger, consolidation, sale or
          exchange of greater than 50% of the stock or
          other equity interest in either entity or a
          sale of all or substantially all of the assets
          of either entity.

19.  Article XXIV is hereby modified by (i) substituting "an
     accounting firm acceptable to Lessor in its reasonable
     discretion" in lieu of "the same certified independent
     accounting firm that prepares the returns for Lessor or such
     other accounting firm as may be approved by Lessor" on the
     third through fifth line of subsection (b) thereof and (ii)
     deleting subsection (d) thereof.

20.  Article XXXII is hereby amended by inserting "1010 Wisconsin
     Avenue, N.W., Washington, D.C. 20007, Attention:  Chief
     Executive Officer, with a copy to William Diamond, Esq.,
     DeCampo, Diamond & Ash, 805 Third Avenue, New York, New York
     10022" as Lessee's address for purposes of notices.

21.  Articles XXXVIII, XXXIX and XL are hereby deleted and the
     following is substituted in lieu thereof:

Page 11

                          ARTICLE XXXVIII

          Compliance with Franchise Agreement.  Lessee
          shall comply in every respect with the
          provisions of the Franchise Agreement so as to
          avoid any default thereunder during the term of
          this Agreement, except to the extent such
          compliance is an obligation of Lessor pursuant
          to the terms of this Lease.  Lessee shall not
          terminate, extend, modify or enter into any
          Franchise Agreement without in each instance
          first obtaining Lessor's prior written consent.
          Lessor and Lessee agree to cooperate fully with
          each other in the event it becomes necessary to
          obtain a Franchise Agreement extension or
          modification or a new franchise for the Leased
          Property.  If the Franchise Agreement expires
          prior to the expiration of the Lease Term,
          Lessee, with the prior approval of Lessor,
          shall use its good faith efforts to obtain a
          new franchise license for the Leased Property,
          together with a comfort letter in favor of
          Lessor in form acceptable to Lessor.

                           ARTICLE XXXIX

          Capital Expenditures and Reserves.  Lessor
          agrees to establish a reserve account together
          with all interest earned thereon for each
          Facility (the "Capital Expenditure Reserve
          Account") to fund Capital Expenditures in an
          amount equal to five percent (5%) of annual
          Room Revenues from each Facility (or such
          greater amount necessary to fund capital
          improvements required to comply with applicable
          Legal Requirements or any requirements imposed
          by the franchisor in accordance with the
          Franchise Agreement or necessary to maintain
          the safety or structural soundness of the
          Leased Property), net of amounts actually
          expended for Capital Expenditures for such
          Facility during any Fiscal Year.  Any funds
          escrowed pursuant to a Franchise Agreement or
          Mortgage and designated for Capital
          Expenditures shall be deemed to be part of the
          Capital Expenditure Reserve Account for the
          applicable Leased Property. Any funds escrowed
          pursuant to a Mortgage may be pledged as
          security for such Mortgage, which pledge may
          provide that, in the event of a default by
          Lessor under the Mortgage, the escrowed funds
          may be applied to the balance of the loan
          secured by the Mortgage; provided, however,
          that in the event the holder of the Mortgage
          exercises such remedy, Lessor shall be
          obligated immediately to deposit into the
          Capital Expenditure Reserve Account any amount
          which may then be necessary to bring the funds
          in such account (together with any funds
          remaining in any other accounts of Lessor
          dedicated for such purpose) up to the aggregate
          level required by this Article XXXIX .  Lessor
          shall make such proceeds available for Capital
          Expenditures on the same terms and conditions
          set forth in such Mortgage provided the same
          are comparable to the terms of this Lease.  The
          Capital Expenditure Reserve Account for each
          Facility may be commingled by Lessor with
          similar accounts of Lessor with respect to
          other hotel properties leased by Lessor to
          Lessee.  The Capital Expenditures disbursed for
          a 

Page 12

          particular Facility shall be made pursuant to
          a Capital Budget and such expenditures may be
          more or less than the five percent (5%) of
          annual Room Revenues reserved by Lessor for
          such Facility in the Capital Expenditure
          Reserve Account.  Upon request by Lessee not
          more frequently than twice a year, Lessor shall
          provide Lessee a written report stating the
          amounts held in such Capital Expenditure
          Reserve Account with respect to each Leased
          Property and amounts disbursed out of said
          account with respect to each Leased Property
          during the prior Fiscal Year.  Upon written
          request by Lessee to Lessor stating the
          specific use to be made and the reasonable
          approval thereof by Lessor, the funds in the
          Capital Expenditure Reserve Account shall be
          made available by Lessor for use by Lessee for
          Capital Expenditures in connection with the
          Primary Intended Use; provided, however, that
          no amounts made available under this Article
          shall be used to purchase property (other than
          "real property" within the meaning of Treasury
          Regulations Section 1.856-3(d)), to the extent
          that doing so would cause the Lessor to
          recognize income other than "rents from real
          property" as defined in Section 856(d) of the
          Code.  All amounts in the Capital Expenditure
          Reserve Account are the property of Lessor.
          Lessee shall have no interest in the Capital
          Expenditure Reserve Account other than with
          respect to the funding of amounts in a Capital
          Budget approved by Lessor.
     
                            ARTICLE XL

          Arbitration.  Except as otherwise expressly
          provided, in the event a dispute should arise
          concerning the interpretation or application of
          any of the provisions of this Lease, the
          parties agree that the dispute shall be
          submitted to arbitration of the American
          Arbitration Association under its then
          prevailing rules, except as modified by this
          Article XL.  The Arbitration Tribunal shall be
          formed of three (3) Arbitrators each of which
          shall have at least five (5) years' experience
          in hotel operation, management or ownership,
          one (1) to be appointed by each of Lessor and
          Lessee and the third (3rd) to be appointed by
          the American Arbitration Association.  The
          arbitration shall take place in the county in
          which the Leased Property is located and shall
          be conducted in the English language.  The
          arbitration award shall be final and binding
          upon the parties hereto and subject to no
          appeal, and shall deal with the question of
          costs of arbitration and all matters related
          thereto. Judgment upon the award rendered may
          be entered into any court having jurisdiction,
          or applications may be made to such court for
          an order of enforcement.  Any arbitration under
          this Article XL shall be submitted within three
          (3) months following the notice which triggers
          the arbitration, and shall be concluded within
          one (1) year thereafter.  In the event either
          of the foregoing deadlines are missed, either
          party may proceed to commence a court
          proceeding to resolve the dispute.


Page 13

                            ARTICLE XLI

          Sale and Termination of Lease.  In the event
          Lessor enters into a contract to sell its
          interest in the Leased Property, Lessor may
          terminate the Lease by giving thirty (30) days
          prior Notice to Lessee, and then, as of the
          closing of such sale, the Lease shall terminate
          and be of no further force and effect except as
          to any obligations existing as of such date
          that survive termination of the Lease, and all
          Rent shall be adjusted as of such date.  As
          compensation for the early termination of
          Lessee's leasehold estate hereunder, Lessor
          shall, at Lessor's election either (a) pay to
          Lessee an amount equal to the Net Present Value
          (as hereinafter defined), as of the closing of
          the sale, of the cash flow to Lessee from the
          operations of the Leased Property being sold
          (after payment of all Rent hereunder) (the
          "Termination Payment") or (b) within sixty (60)
          days after termination of the Lease pursuant to
          this Article offer to lease to the Lessee one
          or more substitute hotel facilities comparable
          to the Leased Property (i.e., comparable market
          and substantially similar class, quality and
          condition of property) pursuant to one or more
          leases ("Substitute Leases") that would create
          for Lessee leasehold estates that have an
          aggregate Fair Market Value of no less than the
          Fair Market Value of the then remaining term of
          the Lease with respect to the Leased Property.
          If Lessor elects and complies with the option
          described in (b) above, regardless of whether
          Lessee enters into any of the Substitute
          Leases, Lessor shall have no further
          obligations to Lessee with respect to
          compensation for the early termination of this
          Lease.  In the event Lessor elects the option
          to provide one or more Substitute Leases and
          Lessor and Lessee are unable to agree within
          three (3) months upon the Fair Market Value of
          the then remaining term of this Lease or one or
          more Substitute Leases, such value(s) shall be
          determined by appraisal using the appraisal
          procedure set forth in Article XL. The "Net
          Present Value" of the cash flow to Lessee from
          the operations of the Leased Property shall be
          determined by aggregating the "Projected Annual
          Discounted Cash Flows" for each fiscal year or
          portion thereof remaining in the Lease Term.
          To determine Projected Annual Discounted Cash
          Flow for each fiscal year or portion thereof,
          the "Projected EBITDA" for each such year shall
          be discounted to the date the Termination
          Payment is made at a discount rate equal to ten
          percent (10%).  "Projected EBITDA" for the
          fiscal year in which the termination occurs
          shall be the average annual "EBITDA" for the
          three (3) Fiscal Years prior to the date of
          termination (or, if three fiscal years have not
          elapsed between the date of this First
          Amendment to Lease and the date of termination,
          the average annual EBITDA for such shorter
          period).  The Projected EBITDA for each
          subsequent year shall be increased at a
          compound rate equal to the average annual
          percentage increase in the CPI for the three
          (3) Fiscal Years prior to the date of
          termination (or, if three fiscal years have not
          elapsed between the date of this First

Page 14


          Amendment to Lease and the date of termination,
          the average annual percentage increase for such
          shorter period).  "EBITDA" shall mean net
          earnings before interest, taxes, depreciation
          and amortization.

                           ARTICLE XLII

          Extension.  Commencing on January 1, 2012,
          Lessor agrees to negotiate in good faith for an
          extension of the Term for a subsequent fifteen
          (15) year period, the terms of which shall be
          based on the fair market value of the leasehold
          interest based on then prevailing rental rates
          for similar properties owned by Real Estate
          Investment Trusts and leased to unaffiliated
          third parties; provided, however, that nothing
          in this Article shall be deemed to obligate
          Lessor to lease the Leased Property to Lessee
          beyond the Term or seek any appraisal to
          determine the fair market value of such
          leasehold interest.
          
                           ARTICLE XLIII
          
          Lessee Information for SEC Filings.  To the
          extent generally accepted accounting principles
          or the rules and regulations of the Securities
          and Exchange Commission ("SEC") require
          financial or other information regarding the
          Lessee to be included in any filings of Winston
          Hotels, Inc. with the SEC, the Lessee hereby
          agrees to provide to the Lessor and Winston
          Hotels, Inc. such information promptly upon
          request and to use its best efforts to respond
          to any comments of the SEC or any other
          governmental or regulatory body with respect
          thereto.  The information provided by Lessee
          for inclusion in any SEC filing of Winston
          Hotels, Inc. shall not contain any false or
          misleading statement of a material fact or omit
          to state any material fact necessary in order
          to make the statements made, in light of the
          circumstances under which they were made, not
          misleading.  Lessor shall pay for all third
          party accounting costs incurred by Lessee in
          complying with the requirements of this Article
          for the calendar year 1997; thereafter, Lessor
          and Lessee shall split any such third party
          accounting costs.

     All capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to them in the Existing
Lease. Except as expressly amended and modified hereby, the
Existing Lease shall otherwise remain in full force and effect, the
parties hereto hereby ratifying and
confirming the same.  To the extent of any inconsistency between
the Existing Lease and this First Amendment to Lease, the terms of
this First Amendment to Lease shall control.

Page 14

     IN WITNESS WHEREOF, the parties have executed this First
Amendment to Lease by their duly authorized officers as of the date
first above written.

                                   LESSOR

Signed and acknowledged            WINN LIMITED PARTNERSHIP, a
in the presence of:                North Carolina limited partnership

                                   By: /s/ Robert W. Winston, III
/s/ Brenda G. Burns                    -------------------------------
- -------------------                    Name: Robert W. Winston, III
Printed Name: Brenda G. Burns

/s/ Lynda G. Davis
- -------------------
Printed Name: Lynda G. Davis


Signed and acknowledged            WINSTON HOTELS, INC., a
in the presence of:                North Carolina corporation

                                   By: /s/ Robert W. Winston, III
/s/ Brenda G. Burns                   --------------------------------
- -------------------                   Name: Robert W. Winston, III
Printed Name: Brenda G. Burns

/s/ Lynda G. Davis
- -------------------
Printed Name: Lynda G. Davis

                                   
                                   LESSEE

Signed and acknowledged            CAPSTAR WINSTON COMPANY, L.L.C.,
in  the  presence  of:             a Delaware limited  liability company


                                   By: /s/ William Driscall
/s/ Kara Amato                         ---------------------------------
- ------------------                    Name: William Driscall
Printed Name: Kara Amato

/s/ Shirley M. Tolbert
- ----------------------
Printed Name: Shirley M. Tolbert