America First Apartment Investors, Inc. Announces Dividend Declaration.

OMAHA, Neb. -- America First Apartment Investors, Inc. (NASDAQ:APRO) (the "Company"), a multifamily real estate investment trust, today announced the Board of Directors has declared a regular quarterly dividend in the amount of $0.25 per share to be paid on July 29, 2005 to shareholders of record on June 30, 2005. Additionally, the following is a discussion of results for the first quarter ended March 31, 2005 as presented in the Company's Form 10-Q filed on May 10, 2005.

Highlights for the quarter:

--Net loss for the quarter ended March 31, 2005 of $981,000 or $0.09 per share, as compared to net income of $19,000 for the same quarter a year ago. The increased net loss is primarily attributable to $1.3 million of non-cash amortization expense associated with in-place lease intangibles. The in-place lease intangibles represent the value assigned to the existing leases at acquired properties including the 13 additional properties acquired by the Company in June 2004 through its acquisition of America First Real Estate Investment Partners, L.P. Additionally, the results for the quarter were negatively impacted by severance charges totaling $345,000, or $0.03 per share.

--Property operations posted improvements in revenue and real estate operating margin as compared to the first quarter of last year. Economic occupancy for the portfolio rose from 79% a year ago to 81% for this quarter. The average annualized rent per apartment climbed from $6,480 in the first quarter of 2004 to $6,973 for this quarter, a 7.6% increase. Real estate operating margin increased from 25% in the first quarter of 2004 to 33% in 2005 due mainly to the elimination of property management fees through the internalization of this function combined with the firming of rental revenues.

--Funds From Operations ("FFO") increased to $2.6 million or $0.25 per share as compared to $1.3 million or $0.25 per share as compared to the prior year. FFO was negatively impacted by the previously discussed severance charges. FFO is a non-GAAP measure that refers to Funds from Operations. FFO is a common measure of operating performance for real estate investment trusts. A reconciliation and further discussion of FFO can be found later in this release.

Management Comments

"We are extremely pleased with our first quarter property operating results. Improved market conditions at the majority of our properties combined with the internalization of the property management operations has proven highly beneficial to the Company. Significant increases in rental revenues were augmented by more efficient and controlled property expense levels," concluded Jack Cassidy, President and CEO. "The flood of capital into the multifamily housing continues to push property prices to historically high levels relative to their current net operating income. As such, the property acquisition environment remains highly competitive."

The Company will continue to employ a prudent, disciplined approach toward property acquisitions. Additionally, management believes the current market provides a unique opportunity to take advantage of today's aggressive buyers including residential condo buyers, particularly in the Florida market. As such, management believes it is prudent to selectively market for sale several properties over the course of 2005. Specifically targeting the condo converters, we will be marketing for sale one of our Florida properties.

Company financial statements and other required disclosures for the quarter ended March 31, 2005 may be found in the Company's quarterly report on Form 10-Q filed with the Securities and Exchange Commission on May 10, 2005.

America First Apartment Investors, Inc. is an equity real estate investment trust focused on multifamily apartment properties located throughout the United States. Its portfolio currently includes 29 multifamily properties and one commercial property. America First Apartment Investors, Inc. press releases are available on the World Wide Web at www.apro-reit.com.

Information contained in this Press Release contains "forward-looking statements" relating to, without limitation, future performance, plans and objectives of management for future operations and projections of revenue and other financial items, which can be identified by the use of forward-looking terminology such as "may," "will," "should," "expect," "anticipate," "estimate" or "continue" or the negative thereof or other variations thereon or comparable terminology. Several factors with respect to such forward-looking statements, including certain risks and uncertainties, could cause actual results to differ materially from those in such forward-looking statements. Reference is hereby made to the filings of America First Apartment Investors, Inc., with the Securities and Exchange Commission, including quarterly reports on Form 10-Q, reports on Form 8-K and its annual report on Form 10-K.