American Retirement Corporation Acquires Galleria Woods Retirement Community from Baptist Health System.

NASHVILLE, Tenn. -- American Retirement Corporation (NYSE: ACR), a leading national provider of senior housing and care, today announced that it has completed the acquisition of Galleria Woods, a senior living community located in Birmingham, Alabama, from Baptist Health System.

Galleria Woods is an established entrance-fee continuing care retirement community that features 153 independent living apartments and garden homes, as well as 24 assisted living apartments and a skilled nursing center with 30 private rooms.

The Company acquired the community, whose occupancy is in the mid-70% range, for approximately $5.5 million of cash (including estimated closing costs) plus the assumption of existing entrance-fee refund obligations of approximately $10.4 million, the majority of which will be repaid with proceeds generated as new residents enter the communities. In addition, the Company has plans for significant physical improvements at Galleria Woods with a budget of approximately $2 million for planned upgrades at the community.

"We're pleased that Baptist Health Systems selected our company to acquire Galleria Woods," said Bill Sheriff, Chairman, President and CEO of American Retirement Corporation. "We are committed to providing high quality services to the residents and will honor all existing resident agreements as we assume ownership of the community."

"This acquisition effectively complements our other Alabama retirement communities: Somerby at University Park in Birmingham and Somerby at Jones Farm in Huntsville," he added. "More than anything else, we are excited about the opportunity to bring our full array of services, such as our innovative rehabilitative and wellness program, to create a full and vibrant community."

"We are pleased to find someone of American Retirement Corporation's caliber and reputation," said Mark Bryan, Senior Vice President/COO of Baptist Health System. "As we redirect our system resources to enhance the care we offer in our hospitals, our goal has been to find someone who would maintain the high standard of quality that has been established at Galleria Woods. The quality and reputation of American Retirement demonstrates that they will be good stewards of the Galleria Woods community."

Company Profile

American Retirement Corporation is a national senior living and health care services provider offering a broad range of care and services to seniors, including independent living, assisted living, skilled nursing and Alzheimer's care. Established in 1978, the Company believes that it is a leader in the operations and management of senior living communities, including independent living communities, continuing care retirement communities, free-standing assisted living communities, and the development of specialized care programs for residents with Alzheimer's and other forms of dementia. The Company's operating philosophy is to enhance the lives of seniors by striving to provide the highest quality of care and services in well-operated communities designed to improve and protect the quality of life, independence, personal freedom, privacy, spirit, and dignity of its residents. The Company currently operates 67 senior living communities in 14 states, with an aggregate unit capacity of approximately 13,300 units and resident capacity of approximately 14,900. The Company owns 16 communities, leases 45 communities, and manages six communities pursuant to management agreements. The Company is publicly traded on the New York Stock Exchange.

Safe Harbor Statement

Statements contained in this press release and statements made by or on behalf of American Retirement Corporation relating hereto 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 include all statements that are not historical statements of fact and those regarding the intent, belief or expectations of the Company or its management, including, without limitation, all statements regarding the Company's repayment of entrance-fees in the future and expectations for Galleria Woods. These forward-looking statements are subject to risks, uncertainties, and assumptions. Important factors that could cause actual results to differ materially from the forward-looking statements made in this press release include those risks described in the Company's filings with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking statements included herein, the Company's actual results could differ materially from such forward-looking statements. The Company 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.