Jerry H. Herman, President and CEO, commented, "Same Room RevPAR for the Company�s AmeriHost Inn hotels increased 3.7% for the year, significantly outpacing the overall lodging industry and the limited service sector. According to Smith Travel Research, RevPAR declined 0.9% for the mid-scale without food & beverage segment of the lodging industry through November 2002. Same Room RevPAR for the Company�s AmeriHost Inn hotels decreased 0.8% during the fourth quarter of 2002 as both corporate and leisure business remained soft."
 

Arlington Hospitality sells existing AmeriHost Inn hotels, as well as other branded hotels, as part of its hotel development strategy. These hotels are wholly owned by the Company, leased or owned by a joint venture in which the Company is a partner. The Company typically facilitates the sale of hotels owned by joint ventures and landlords. Arlington's sale of hotel activity over the recent period is summarized as follows:
 

These results for the year include the sale of four wholly owned AmeriHost Inn hotels, including two during the fourth quarter of 2002, the sale of two AmeriHost Inn hotels by non-controlled joint ventures, including one during the fourth quarter of 2002, the sale of one leased AmeriHost Inn hotel, and the sale of one other brand hotel during the fourth quarter by a non-controlled joint venture. The Company expects the sales that closed during the fourth quarter 2002 to generate fourth quarter 2002 revenue of approximately $5.2 million, net pretax income of approximately $550,000, the reduction of debt of approximately $4.6 million, and the repayment of approximately $1.9 million in loans receivable from joint ventures in connection with the hotel sales. The Company anticipates an adjustment during the fourth quarter of 2002 of approximately $400,000 to net realizable value on its investment in a non-AmeriHost Inn hotel currently under contract for sale. 

In addition, the Company currently has five AmeriHost Inn hotels and two other branded hotels under contract for sale, including hotels owned by joint ventures. These sales are expected to close during the next six months. The revenue and profit/loss from the sale of hotels, as well as the reduction of debt will be reported in the Company�s financial statements as of the date the sale transactions close. One of the AmeriHost Inn hotels currently under contract for sale is expected to generate pretax income of approximately $1.5 million. Although the Company has these hotels under contract for sale, with nonrefundable cash deposits in certain cases, certain conditions to closing remain and there can be no assurance that these sales will be consummated as anticipated.

The sale of AmeriHost Inn hotels allows the Company to realize a development incentive fee from its agreement with Cendant Corporation in addition to any profits realized from the sale. The Company also benefits from a long term royalty sharing agreement with Cendant from each AmeriHost Inn hotel not owned by the Company that is in the franchise system. The above-mentioned anticipated results from these sales do not include any of these fees and payments from Cendant. 

The forecasted amounts of revenue and pretax income described above relate solely to closed or pending sales activities. Such forecasted amounts from closed or pending sales could differ from the final amounts included in the Company�s applicable quarterly and annual financial statements when issued. Furthermore, such forecasted amounts do not represent guidance on, or forecasts of, the results of the Company�s entire consolidated operations, which are reported on a quarterly basis. 

During the year ended December 31, 2002, the Company opened two newly constructed AmeriHost Inn hotels for its own account, opened one AmeriHost Inn hotel for a non-controlled joint venture, and completed construction of one AmeriHost Inn hotel for an unaffiliated third party. During the year ended December 31, 2002, the Company began construction on two AmeriHost Inn hotels for its own account, and began construction on one AmeriHost Inn hotel for a non-controlled joint venture. Currently, the Company has four AmeriHost Inn hotels under construction, including three wholly owned hotels and one joint venture. These hotels are expected to open during the next six months. 

From time to time, the Company may utilize cash to purchase its own common stock. Currently, the Board of Directors has authorized the Company to buy back, at any time and without notice, up to 1,000,000 shares of it own common stock under certain conditions.

Arlington Hospitality, Inc. is the largest owner and operator of AmeriHost Inn hotels in the United States. Cendant Corporation (NYSE: CD) is the franchisor of the AmeriHost Inn brand.

Arlington Hospitality, Inc. is a publicly traded hotel management and development company that builds, manages and sells mid-priced hotels throughout the United States, primarily under the AmeriHost Inn brand. Arlington Hospitality, Inc. owns or manages 72 properties in 17 states, including 62 AmeriHost Inn hotels, and 10 other branded hotels, for a total of 5,283 rooms, with four additional AmeriHost Inn & Suites hotels under construction. 

The statements appearing in this press release can be construed as forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.