ENVIRONMENTAL INDEMNITY AGREEMENT

Exhibit 10.33

ENVIRONMENTAL INDEMNITY AGREEMENT

THIS ENVIRONMENTAL INDEMNITY AGREEMENT (this “ Agreement ”), made as of November 10, 2004 jointly and severally by MARRIOTT RESIDENCE INN II LIMITED PARTNERSHIP, a Delaware limited partnership (“ Borrower ”), whose address is 814 E. Main Street, Richmond, Virginia 23219, and by APPLE HOSPITALITY TWO, INC., a Virginia corporation (“ Principal ”) whose address is 814 E. Main Street, Richmond, Virginia 23219 (Borrower and Principal being referred to herein collectively as “ Indemnitors ” and individually as “ Indemnitor ”), in favor of WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (“ Lender ”), whose address is 301 South Tryon Street, PMB 35-123, Charlotte, North Carolina 28282.

W I T N E S S E T H :

WHEREAS, Lender has extended to Borrower a loan (the “ Loan ”) in the principal amount of Four Million Eight Hundred Seventy-Five Thousand and No/100 Dollars ($4,875,000.00); and

WHEREAS, the Loan is evidenced by a Promissory Note (the “ Note ”) dated of even date herewith, executed by Borrower and payable to the order of Lender, in the stated principal amount of Four Million Eight Hundred Seventy-Five Thousand and No/100 Dollars ($4,875,000.00), and is secured by a Mortgage and Security Agreement (the “ Mortgage ”) dated of even date herewith, from Borrower for the benefit of Lender, encumbering that certain real property situated in the County of Duval, State of Florida, as is more particularly described on Exhibit A attached hereto and incorporated herein by this reference, together with the buildings, structures and other improvements now or hereafter located thereon (said real property, buildings, structures and other improvements being hereinafter collectively referred to as the “ Property ”), and by the other Loan Documents (as defined in the Mortgage); and

WHEREAS, as a condition to making the Loan, Lender has required that Indemnitors indemnify Lender with respect to any past, present or future environmental conditions or liabilities on, in, under, affecting or in any way associated with the Property as herein set forth.

NOW, THEREFORE, to induce Lender to extend the Loan to Borrower and in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Indemnitors hereby covenant and agree for the benefit of Lender, as follows:

1. Indemnity . Indemnitors hereby agree to pay, protect, defend (at trial and appellate levels and with attorneys, consultants and experts reasonably acceptable to Lender), and save Lender harmless from and against, and hereby indemnify Lender from and against any

and all liens, damages (including, without limitation, punitive or exemplary damages), losses, liabilities (including, without limitation, strict liability), obligations, settlement payments, penalties, fines, assessments, citations, directives, claims, litigation, demands, defenses, judgments, suits, proceedings, costs, disbursements and expenses of any kind or of any nature whatsoever (including, without limitation, reasonable attorneys’, consultants’ and experts’ fees and disbursements actually incurred in investigating, defending, settling or prosecuting any claim, litigation or proceeding) (collectively “ Costs ”) which may at any time be imposed upon, incurred by or asserted or awarded against Lender, Indemnitors or the Property, and arising from or out of, whether now, hereafter or heretofore occurring: (i) any violation or alleged violation of, or liability or alleged liability under, any local, state or federal law, rule or regulation or common law duty pertaining to human health as affected by the environment, natural resources or the environment, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. §9601 et seq.) (“ CERCLA ”), the Resource Conservation and Recovery Act of 1976 (42 U.S.C. §6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. §1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Emergency Planning and Community-Right-to-Know Act (42 U.S.C. § 11001 et seq.), the Endangered Species Act (16 U.S.C. § 1531 et seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Occupational Safety and Health Act (29 U.S.C. § 651 et seq.) and the Hazardous Materials Transportation Act (49 U.S.C. §1801 et seq.), and those relating to Lead Based Paint (as hereinafter defined) and the regulations promulgated pursuant to said laws, all as amended from time to time, (collectively, “ Environmental Laws ”), relating to or affecting the Property, whether or not caused by or within the control of Indemnitors; (ii) the presence, release or threat of release of or exposure to any hazardous, toxic or harmful substances, wastes, materials containing more than 1% asbestos, pollutants or contaminants (including, without limitation, polychlorinated biphenyls, petroleum or petroleum products or byproducts, flammable explosives, radioactive materials, paint containing more than .05% lead by dry weight (“ Lead Based Paint ”), Toxic Mold (as hereinafter defined), infectious substances or raw materials which include hazardous constituents) or any other substances or materials which are included under or regulated by Environmental Laws (collectively, “ Hazardous Substances ”) or radon, on, in, under or affecting all or any portion of the Property or any surrounding areas, regardless of whether or not caused by or within the control of Indemnitors; (iii) any transport, treatment, recycling, storage, disposal or arrangement therefor of Hazardous Substances whether on the Property, originating from the Property, or otherwise associated with the Indemnitors or any operations conducted on the Property at any time; (iv) the failure by Indemnitors to comply fully with the terms and conditions of this Agreement; (v) the breach of any representation or warranty contained in this Agreement in any material respect; (vi) the enforcement of this Agreement, or (vii) any environmental investigation, assessment, audit or review conducted in connection with the Property or the operations conducted at any time thereon, including, without limitation, the cost of assessment, investigation, and to the extent required by Environmental Laws, containment, removal and/or remediation of any and all Hazardous Substances from all or any portion of the Property or any surrounding areas, the cost of any actions taken in response to the presence, release or threat of release of any Hazardous Substances on, in, under or affecting any portion of the Property or any surrounding areas to prevent or minimize such release or threat of release so that it does not migrate or otherwise cause or threaten danger to present or future public health, safety, welfare or the environment, and costs incurred to comply with Environmental Laws in connection with all or any portion of the Property or any surrounding

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areas. “ Costs ” as used in this Agreement shall also include, but not be limited to, any diminution in the value of the security afforded by the Property or any future reduction of the sales price of the Property by reason of any matter set forth in this Section 1. The foregoing indemnity shall specifically not include any such costs relating to Hazardous Substances which are initially placed on, in or under the Property after foreclosure or other taking of title to the Property by Lender or its successor or assigns, or which are finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Lender. For the purposes hereof, “ Toxic Mold ” shall mean any mold or fungus at the Property which is of a type (i) that might pose a significant risk to human health or the environment or (ii) that would negatively impact the value of the Property.

2. Representations and Warranties . Indemnitors hereby represent and warrant to and covenant and agree with Lender as follows:

(a) To the best of Indemnitors’ knowledge, information and belief, none of the Borrower nor the Property or any tenant at the Property or the operations conducted thereon is in direct or indirect violation of or otherwise exposed to any liability under any Environmental Law;

(b) To the best of Indemnitors’ knowledge, information and belief, no Hazardous Substances are located on, in or under or have been handled, generated, stored, processed or disposed of on, in or under or released or discharged from the Property (including underground contamination), except for those substances used by Borrower in the ordinary course of its business, in compliance with all Environmental Laws and where such could not reasonably be expected to give rise to liability under Environmental Laws;

(c) To the best of Indemnitors’ knowledge, information and belief, radon is not present at the Property in excess or in violation of any applicable thresholds or standards or in amounts that require under applicable law disclosure to any tenant or occupant of or invitee to the Property or to any governmental agency or the general public.

(d) To the best of Indemnitors’ knowledge, information and belief, the Property is not subject to any private or governmental lien or judicial or administrative notice or action arising under Environmental Laws;

(e) There is no pending, nor, to Indemnitors’ knowledge, information or belief, threatened litigation arising under Environmental Laws affecting Borrower or the Property;

(f) To the best of Indemnitors’ knowledge, information and belief, there are no and have been no underground storage tanks or other underground storage receptacles or surface impoundments for Hazardous Substances or landfills or dumps on the Property;

(g) Indemnitors have received no notice of, and to the best of Indemnitors’ knowledge and belief, there exists no investigation, action, proceeding or claim by any agency, authority or unit of government or by any third party which could result in any liability, penalty, sanction or judgment under any Environmental Laws with respect to any condition, use or

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operation of the Property, nor do Indemnitors know of any basis for such an investigation, action, proceeding or claim;

(h) Indemnitors have received no notice that, and to the best of Indemnitors’ knowledge and belief, there has been no claim by any party that, any use, operation or condition of the Property has caused any nuisance or any other liability or adverse condition on any other property, nor do Indemnitors know of any basis for such a claim;

(i) Indemnitors have not received nor to the best of Indemnitors’ knowledge, information and belief has there been issued, any notice, notification, demand, request for information, citation, summons, or order in any way relating to any actual, alleged or potential violation or liability arising under Environmental Laws; and

(j) To the best of Indemnitors’ knowledge, information and belief, the Property is not listed or, to the best of Indemnitors’ knowledge, information and belief, proposed for listing on the National Priorities List promulgated pursuant to CERCLA, on CERCLIS (as defined in CERCLA) or on any similar federal or state list of sites requiring environmental investigation or clean-up.

3. Covenants of Indemnitors .

(a) Indemnitors shall comply with all applicable Environmental Laws. Indemnitors shall keep or cause the Property to be kept free from Hazardous Substances (except those substances used by Borrower in the ordinary course of its business, in compliance with all Environmental Laws and where such could not reasonably be expected to give rise to liability under Environmental Laws) and except in compliance with all Environmental Laws, Indemnitors shall not install or use any underground storage tanks. Indemnitors shall expressly prohibit the use, generation, handling, storage, production, processing and disposal of Hazardous Substances by all tenants of space in the Improvements in quantities or conditions that would violate or give rise to any obligation to take remedial or other action under any applicable Environmental Laws. Without limiting the generality of the foregoing, during the term of this Agreement, Indemnitors shall not install in the Improvements or permit to be installed in the Improvements any materials containing more than 1% asbestos. Indemnitors further acknowledge and agree that Lender has no duty to provide Indemnitors with any information regarding the Environmental Laws or any interpretation thereof.

(b) Indemnitors shall immediately notify Lender should Indemnitors, or either of them, become aware of (i) the actual or potential existence of any Hazardous Substances on the Property, other than those occurring in the ordinary course of Borrower’s business and which do not violate, or would not otherwise give rise to liability under Environmental Laws, (ii) any violation of, or other exposure to liability under, any Environmental Laws, (iii) any lien, action or notice affecting the Property or Borrower resulting from any violation or alleged violation of or liability or alleged liability under any Environmental Laws, (iv) the institution of any investigation, inquiry or proceeding concerning Borrower or the Property pursuant to any Environmental Laws or otherwise relating to Hazardous Substances, or (v) the discovery of any occurrence, condition or state of facts which would render any representation or warranty

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contained in this Agreement incorrect in any material respect if made at the time of such discovery. Immediately upon receipt of same, Indemnitors, or either of them, shall deliver to Lender copies of any and all requests for information, complaints, citations, summonses, orders, notices, reports or other communications, documents or instruments in any way relating to any actual, alleged or potential violation or liability of any nature whatsoever arising under Environmental Laws and relating to the Property or to Borrower. Indemnitors shall remedy or cause to be remedied in a timely manner (and in any event within the time period permitted by applicable Environmental Laws) any violation of Environmental Laws or any condition that could give rise to liability under Environmental Laws. Without limiting the foregoing, Indemnitors shall, at their own expense, take all actions required by applicable Environmental Laws, for the clean-up of any and all portions of the Property or other affected property, including, without limitation, all investigative, monitoring, removal, containment and remedial actions in accordance with all applicable Environmental Laws (and in all events in a manner satisfactory to Lender), and shall further pay or cause to be paid, at no expense to Lender, all clean-up, administrative and enforcement costs of applicable governmental agencies which may be asserted against Indemnitors or the Property.

(c) Upon the request of Lender following the occurrence and continuance of an Event of Default or at such other time as Lender has reasonable grounds to believe that Hazardous Substances are or have been released, stored or disposed of on or around the Property or that the Property may be in violation of the Environmental Laws, Indemnitors shall perform or cause to be performed, at Indemnitors’ sole expense and in scope, form and substance satisfactory to Lender, an inspection or audit of the Property prepared by a hydrogeologist or environmental engineer or other appropriate consultant approved by Lender indicating the presence or absence of Hazardous Substances on the Property, the compliance or non-compliance status of the Property and the operations conducted thereon with applicable Environmental Laws, or an inspection or audit of the Property prepared by an engineering or consulting firm approved by Lender indicating the presence or absence of friable asbestos or substances containing in excess of 1% asbestos or lead or substances containing lead on the Property. If Indemnitors fail to provide reports of such inspection or audit within thirty (30) days after such request, Lender may order the same, and Indemnitors hereby grant to Lender access to the Property and an irrevocable license to undertake such inspection or audit. The cost of such inspection or audit shall be included in Costs and shall be paid by Indemnitors in accordance with the terms of Section 4(c) hereof.

(d) If, prior to the date hereof, it was determined that the Property contains Lead Based Paint, the assessment report describing the location and condition of the Lead Based Paint (a “ Lead Based Paint Report ”) is attached hereto and made a part hereof as Exhibit B . If, at any time hereafter, Lead Based Paint is suspected of being present on the Property, Indemnitors agree, at their sole cost and expense and within sixty (60) days thereafter, to cause to be prepared a Lead Based Paint Report prepared by an expert, and in form, scope and substance, acceptable to Lender.

(e) Indemnitors agree that if it has been, or if at any time hereafter it is, determined that the Property contains Lead Based Paint, on or before thirty (30) days following (i) the date hereof, if such determination was made prior to the date hereof or (ii) such determination, if such

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determination is hereafter made, as applicable, Indemnitors shall, at their sole cost and expenses, develop and implement, and thereafter diligently and continuously carry out (or cause to be developed and implemented and thereafter diligently and continually to be carried out), an operations, abatement and maintenance plan for the Lead Based Paint on the Property, which plan shall be prepared by an expert, and be in form, scope and substance, acceptable to Lender (together with any plan attached hereto as Exhibit C , the “ O&M Plan ”). (If an O&M Plan has been prepared prior to the date hereof, same is attached hereto and made a part hereof as Exhibit C , and Indemnitors agree to diligently and continually carry out (or cause to be carried out) the provisions thereof.) Compliance with the O&M Plan shall require or be deemed to require, without limitation, the proper preparation and maintenance of all records, papers and forms required under the Environmental Laws.

4. Indemnification Procedures .

(a) If any action shall be brought against Lender based upon any of the Costs for which Lender is indemnified