Royal Host Real Estate Investment Trust

Royal Host Real Estate Investment Trust

November 21, 2006 12:53 ET

Royal Host REIT Announces Normal Course Issuer Bid for Its 7.90% Subordinated Unsecured Convertible Debentures, Series A

CALGARY, ALBERTA--(CCNMatthews - Nov. 21, 2006) - Royal Host Real Estate Investment Trust (TSX:RYL.UN) (TSX:RYL.DB) (TSX:RYL.DB.A) (TSX:RYL.DB.B) (TSX:RYL.DB.C) ("Royal Host") announced today that the Toronto Stock Exchange ("TSX") has accepted Royal Host's Notice of Intention to make a Normal Course Issuer Bid (the "Bid") to purchase for cancellation, from time to time, as Royal Host considers advisable, up to a maximum of $3,498,000 principal amount of Royal Host's issued and outstanding 7.90% subordinated unsecured convertible debentures, series A, with a maturity date of April 30, 2009 ("Debentures") (Trading Symbol: RYL.DB.A) (3,498 Debentures). Purchases of Debentures will be made on the open market through the TSX. There are currently $35 million principal amount of the Debentures outstanding. The maximum principal amount of Debentures to be purchased pursuant to the Bid represents approximately 10% of the "public float" of the Debentures outstanding on the date hereof, calculated in accordance with the rules of the TSX (being approximately $34,979,000 principal amount of Debentures). The price which Royal Host will pay for any Debentures purchased by it will be the prevailing market price of the Debentures on the TSX at the time of such purchase. The actual number of Debentures that may be purchased for cancellation and the timing of any such purchases will be determined by Royal Host.

The Bid will commence on November 23, 2006 and will terminate on November 22, 2007 or such earlier time as the Bid is completed or terminated at the option of Royal Host.

Management of Royal Host believes that, from time to time, the market price of the Debentures may not fully reflect the underlying value of the Debentures and that at such times the purchase of Debentures would be in the best interests of Royal Host. Such purchases will increase the proportionate interest of, and may be advantageous to, all remaining Debenture holders. In addition, the purchases by Royal Host may increase liquidity to Royal Host's Debenture holders wishing to sell their Debentures.

Royal Host has not made any purchases of Debentures during the previous 12 months.

Royal Host's core businesses are hotel ownership, management and franchising. As at September 30, 2006, Royal Host owned 37 hotels (comprising 4,500 rooms), managed an additional 89 properties for third parties, and franchised 111 locations (including 16 owned by Royal Host) under the Travelodge and Thriftlodge banners, for a total of 18,000 guestrooms in the economy, mid-market and upscale hospitality segments.

Royal Host is committed to creating stable and repeatable earnings through high quality assets, efficient operations and exceptional people. Through strategic management and growth of its assets, and ongoing training, communication and teamwork, it is committed to achieving ongoing improvements to its bottom line results. Royal Host Units and Convertible Debentures are traded on the Toronto Stock Exchange under the trading symbols "RYL.UN", "RYL.DB", "RYL.DB.A", "RYL.DB.B" and "RYL.DB.C", respectively.

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