American Retirement Adds Three Properties.

NASHVILLE, Tenn.--(BUSINESS WIRE)--Nov. 2, 1999--

American Retirement Corporation (NYSE: ACR), one of the largest providers of senior living and health care services, announced today that it has added properties to three of its Senior Living Networks. These included assisted living communities in Houston and Tampa and a skilled nursing center for its Continuing Care Retirement Community (CCRC) in Phoenix.

In Houston, the Company arranged for the acquisition of a 96 resident-capacity community, "The Hampton at Cypress Station", which will be operated by ARC pursuant to a management agreement. The 3-story building, opened in February 1999, includes a 77 resident assisted living unit and a 19 resident Alzheimer's unit. ARC currently has 7 communities with a resident capacity of 684 in its Senior Living Network in the Houston area.

In its Tampa Senior Living Network, American Retirement secured a management contract, with an option to purchase, for an 86 resident-capacity community, which has been open since 1998. The community includes 60 resident assisted living beds and 26 resident Alzheimer's beds, and will be operated under the name "Homewood at Countryside". ARC currently has 8 communities with a resident capacity of 2,306 in its Senior Living Network in the Tampa/St. Petersburg area.

In Phoenix, the Company secured a management contract for an up-scale private pay skilled nursing center with 128 beds. The new health center will be operated under the name "Freedom Plaza Health Center". It opened in 1996 and is located adjacent to Freedom Plaza and Plaza Del Rio Healthcenter, both currently managed by ARC. Freedom Plaza, combined with Plaza Del Rio, is an up-scale CCRC with 350 independent living units, 78 assisted living and Alzheimer's units and 128 nursing beds. Freedom Plaza Health Center will become the preferred health center for the residents of Freedom Plaza, while the older Plaza Del Rio will become a much-needed resource for the surrounding community and ARC's growing Phoenix network. Additionally, a 40 unit assisted living expansion is planned for Freedom Plaza Health Center. Including other development in process, the Company plans to have over 1,500 units in its Phoenix Senior Living Network providing independent living, assisted living, skilled nursing and Alzheimer's care.

"These three additions are representative of how we intend to fill in our Senior Living Networks to provide a continuum of care for our residents," said Bill Sheriff, Chairman and Chief Executive Officer of American Retirement. "The skilled nursing center is an important part of the natural flow of residents as they age in place. We intend to pursue strategic acquisitions of existing already-built communities within our Networks, which will broaden our reach around our larger, more established CCRC's. For now, we have stopped new assisted living development as we expect increasing opportunity for growth through opportunistic acquisitions within our Networks."

American Retirement Corporation offers a broad range of care and services to seniors, including independent living, assisted living, skilled nursing and Alzheimer's care. The Company currently operates 53 senior living communities in 16 states with an aggregate capacity for approximately 13,500 residents. American Retirement is currently developing or constructing 18 senior living communities and expanding 5 of its existing communities, which in the aggregate will add capacity for approximately 1,900 residents. The Company's strategy is to develop senior living networks in major metropolitan regions. These networks are made up of large continuing care retirement communities and free-standing assisted living residences located in the same markets, with skilled nursing capabilities at one or more of the network communities.

This press release and statements made by or on behalf of American Retirement Corporation may be deemed to constitute forward-looking information made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be affected by certain risks and uncertainties, including those described in American Retirement Corporation's Annual Report on Form 10-K for the year ended December 31, 1998 under the caption "Risk Factors" and in American Retirement's other filings with the Securities and Exchange Commission, the difficulty of identifying suitable acquisitions and the risks associated with the integration of any such acquisitions. In light of those significant uncertainties, American Retirement Corporation's actual results could differ materially from such forward-looking statements. American Retirement Corporation does not undertake any obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.