ROYAL HOST CORP. AWARDED HOTEL MANAGEMENT CONTRACTS

Press Release: Royal Host

March 8, 1999
Royal Host Corp. (formally Royco Hotels & Resorts Ltd.) a wholly owned subsidiary of Royal Host Real Estate Investment Trust (REIT) has announced that it has been awarded the hotel management contracts for 27 U.S. properties located in Alaska, Washington and Oregon.

A Seattle-based company owns the interest in the 27 properties and awarded the contracts to Royal Host Corp. based on the company's historic capacity to successfully manage this number of properties. These 27 properties will add revenues from 2,253 rooms.

"While 27 properties is a significant addition to the company's portfolio that now totals 74 properties with 7,450 rooms, Royal Host Corp. still has the capacity within the management group to successfully acquire future management and administration contracts," explains Terry Royer, President and Chief Executive Officer, Royal Host Corp.

Royal Host Corp's acquisition of these U.S. hotel management contracts represents the first time that a real estate investment trust (REIT) has had the ability to increase bottom line profits without returning to the market to acquire more capital. "These U.S. properties will help drive Royal Host earnings for the year and will make our $1.20 annual distribution very achievable," says Randy Royer; President and Chief Executive Officer, Royal Host REIT.

Royal Host REIT recently internalized the hotel and resort management (Royal Host Corp.) and vacation ownership businesses (Royal Host Resort and Vacation Club Ltd.).

"The fees derived from the management and administration of the 27 properties will be retained inside the REIT, thus allowing all profits to flow directly to the unitholders which clearly demonstrates the benefits of internalized management," explains Royer.

Royal Host REIT is a Calgary-managed, closed-end real estate investment trust with a national portfolio of 36 hotels, encompassing 4,491 rooms that compete in the high margin mid-market segment. In addition, Royal Host Corp. owns the Travelodge master franchise in Canada, provides hotel and resort management services, markets vacation intervals in hotels, resorts and luxury houseboats, and operates a facility for customers to exchange vacations.