Allied Hotel Properties Announces First Quarter 2002 Financial Results

Vancouver, B.C. – Allied Hotel Properties Inc. (“Allied”, stock symbol AHP) has reported its financial results for the three months ended March 31, 2002.

Revenues were $10.2 million and gross profit was $4.6 million for the three months ending March 31, 2002, decreasing from $15.6 million and $7.5 million, respectively, from the prior year period. Operating loss of $1.2 million was reported for the three month period, an improvement of 20% from $1.5 million for the same period in 2001. The Company transferred its interest in two hotel properties prior to the end of 2001, accounting for the majority of the decrease in revenues and gross profit. Lower levels of business travel as a result of the general economic decline in North America, in conjunction with the events of September 11th, also contributed to the decrease in revenues in the current year.

Net loss for the three month period was slightly under $2.0 million (2? per share), an improvement of 45% compared to $3.6 million (3? per share) for the first three months of 2001. Lower interest expense and Company wide cost-saving measures contributed to this improvement to the bottom line.

Allied is a hotel ownership and management company with hotel properties in Greater Vancouver, Edmonton and Toronto. Its hotel portfolio currently consists of: Crowne Plaza Hotel Georgia, Crowne Plaza Chateau Lacombe, Crowne Plaza Toronto Don Valley Hotel, Vancouver Airport Conference Resort, Delta Vancouver Airport and Holiday Inn Vancouver Downtown Hotel. Interested parties can find further information at www.alliedhotels.com.

On behalf of the Board of Directors:

Mr. Ronald G. Erdman
President and Chief Executive Officer

For more information please contact:
Allied Hotel Properties Inc.
Tel: 604-669-5335
Fax: 604-689-9332
e-mail: info@alliedhotels.com

THE CANADIAN VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

ALLIED HOTEL PROPERTIES INC.
Consolidated Balance Sheets
March 31, 2002 and December 31, 2001
(in thousands of dollars)
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                                        March 2002      December 2001
                                         Unaudited         Audited
Assets
Current assets:
  Cash and cash equivalents             $      ?         $      179
  Accounts receivable                        1,916            2,281
  Due from affiliated company                  ?                 72
  Inventories                                  441              482
  Prepaid expenses                             568              506
  Future income taxes                           74               74
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                                             2,999            3,594
Income-producing properties                117,365          118,059
Investments                                  2,550              916
Deferred costs, net of amortization            382              390
Future income taxes                          4,947            4,566
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                                        $  128,243       $  127,525
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Liabilities and Shareholders' Equity

Current liabilities:
  Bank indebtedness                     $      961       $     ? 
  Accounts payable and accrued liabilities  13,038           12,749
  Deferred revenue                           3,165              254
  Capital lease obligation                     413              444
  Long-term debt                            99,188            3,532 
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                                           116,765           16,979
Deferred revenue                             2,167            2,212
Long-term debt                                 ?             96,623
Capital lease obligation                       491              557
Non-controlling interest                       484              819
                                           119,907          117,190
Shareholders' equity:
  Share capital                             29,868           29,868
  Deficit                                  (21,532)         (19,533)
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                                             8,336           10,335
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                                        $  128,243       $  127,525
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ALLIED HOTEL PROPERTIES INC.
Unaudited Consolidated Statements of Operations
Three months ended March 31, 2002 and 2001
(in thousands of dollars, except per share amounts)
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                                              2002             2001

Revenues:
  Rooms                                  $   5,597       $    9,709
  Food and beverage                          3,405            4,647
  Other                                      1,232            1,205
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                                            10,234           15,561
Cost of sales:
  Rooms                                      2,092            3,533
  Food and beverage                          3,180            4,105
  Other                                        344              371
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                                             5,616            8,009
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Gross profit                                 4,618            7,552

Operating expenses:
  Selling, general and administrative        3,855            5,959
  Management fees                              126              333
  Taxes and insurance                          960            1,330
  Depreciation and amortization                847            1,395
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                                             5,788            9,017
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Operating loss                               1,170            1,465

Other expenses (income):
  Interest on long term debt                 1,351            2,958
  Other interest                               193              453
  Equity in income of investees                (32)             (36)
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                                             1,512            3,375
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Loss before income taxes
         and non-controlling interest        2,682            4,840

Income taxes (recovery):
  Current                                       33               53
  Future                                      (381)            (724)
                                              (348)            (671)
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Loss before non-controlling interest         2,334            4,169

Non-controlling interest                      (335)            (568)
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Net loss                                 $   1,999        $   3,601
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Basic and diluted loss per share             $0.02            $0.03
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