SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* BRE HY FUNDING LLC (Last) (First) (Middle) (Street) (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol LODGIAN INC [ LGN ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 06/25/2004
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock	06/25/2004		J(1)		1,049,034	A	(1)	1,326,909(2)	I	See Footnote(4)(5)
Series A Preferred Stock	06/25/2004		J(1)		394,889	D	(1)	394,890(3)	I	See Foonote(4)(5)

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares

1. Name and Address of Reporting Person* BRE HY FUNDING LLC (Last) (First) (Middle) (Street) (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Blackstone Real Estate Partners III L.P. (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Blackstone Real Estate Associates III L.P. (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Blackstone Real Estate Management Associates III L.P. (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* BREA III L.L.C. (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* PETERSON PETER G (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SCHWARZMAN STEPHEN A (Last) (First) (Middle) 345 PARK AVENUE 31ST FLOOR (Street) NEW YORK NY 10154 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. On June 25, 2004, BRE/HY Funding L.L.C., a Delaware limited liability company ("BRE/HY"), exchanged 394,889 shares of Series A Preferred Stock, par value $0.01 per share ("Preferred Stock"), for 1,049,034 shares of Common Stock, par value $0.01 per share ("Common Stock"), pursuant to the Preferred Share Exchange Agreement, dated as of June 22, 2004, by and among the Issuer and each of the holders of Preferred Stock.

2. The number of shares of Common Stock beneficially owned following the reported transaction reflects a 1-for-3 reverse stock split effective April 29, 2004.

3. The number of shares of Preferred Stock beneficially owned following the reported transaction includes 86,189 shares of Preferred Stock paid as an in kind dividend pro rata to holders of Preferred Stock on November 21, 2003.

4. The Reporting Persons are BRE/HY, Blackstone Real Estate Partners III L.P., a Delaware limited partnership ("BREP"), Blackstone Real Estate Associates III L.P., a Delaware limited partnership ("BREA"), Blackstone Real Estate Management Associates III L.P., a Delaware limited partnership ("BREMA"), BREA III L.L.C., a Delaware limited liability company ("BRE"), and Peter G. Peterson and Stephen A. Schwarzman. The securities are held of record by BRE/HY. As the managing member of BRE/HY, BREP may be deemed to be the beneficial owner of securities held by BRE/HY. As the general partner of BREP, BREA may be deemed to be the beneficial owner of securities deemed to be beneficially owned by BREP. As the general partner of BREA, BREMA may be deemed to be the beneficial owner of securities deemed to be beneficially owned by BREA. (Footnote continued in Footnote (5))

5. As the general partner of BREMA, BRE may be deemed to be the beneficial owner of securities deemed to be beneficially owned by BREMA. As the founding members of BRE, Messrs. Peterson and Schwarzman may be deemed to be the beneficial owners of securities deemed to be beneficially owned by BRE. Each of the Reporting Persons disclaims beneficial ownership of the securities, except to the extent of its or his pecuniary interest.

Remarks:

Exhibits: Exhibit A -- Joint Filing Agreement

	/s/ Jonathan D. Gray	06/29/2004
	** Signature of Reporting Person	Date
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