Acquisition

Peel Hotels PLC
26 June 2002


PRESS RELEASE

Peel Hotels Plc announced today the completion of the acquisition from Grace
Hotels, for a cash consideration of £9.4 million, the freeholds and businesses
of the Avon Gorge Hotel, Bristol and the George Hotel in Wallingford, together
with ancillary properties.

The Avon Gorge has 76 bedrooms and suites and is located on a landmark site
overlooking the Clifton Suspension Bridge.  Planning permission has been granted
for a further ten bedrooms and a leisure complex.

The George has 39 bedrooms and is located in the centre of the thriving town of
Wallingford, which lies between Oxford and Reading.

Commenting on the acquisitions and trading progress in the first quarter of the
current financial year, commencing 18 February 2002, Chairman Robert Peel said:

'We are delighted to acquire both hotels, which we have managed for several
years, and which complement our existing four owned hotels in Leeds, Newcastle,
Bradford and Peterborough.  In their latest financial year ended 23 December
2001 sales generated by the two hotels were £3.1 million and earnings before
interest, tax and depreciation were £992,000 in aggregate.

In the first quarter of the company's current financial year trading has been
satisfactory and up to plan.  Sales in our owned hotels, on a like for like
basis, have increased by 3.9% and RevPar by 7%'.


Contact:   Robert Peel      020 7286 6823



26 June 2002






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