Disposal of Avon Gorge Hotel

Peel Hotels PLC
30 August 2007



                                PEEL HOTELS PLC

                        ('Peel Hotels' or the 'Company')


                          Disposal of Avon Gorge Hotel


Peel Hotels announced today that it has reached agreement for the sale of the
business and assets, together with the freehold property, known as the Avon
Gorge Hotel in Bristol together with the associated staff house at 10, Caledonia
Place in Bristol for an aggregate consideration of £15,500,000 to be paid in
cash at completion, with completion expected on Monday 3 September 2007.
Attributable Earnings for the Avon Gorge Hotel for the Financial Year ended 11
February 2007 before Interest, Tax and Depreciation was £747,694.


Peel Hotels also announced today that it had reached agreement on Friday 24
August 2007 for the sale of the freehold of three quarters of an acre of land
with planning permission for 99 new apartments, office space and associated car
parking in Salem Street, Bradford for a consideration of £2,000,000 to be paid
in cash at completion, with completion expected on 26 November 2007. This land
had been acquired by Peel Hotels in conjunction with the acquisition of the
Midland Hotel, Bradford in 1998. Attributable Earnings from Car Parking income
at the Salem Street site for the Financial Year ended 11 February 2007 before
interest, Tax and Depreciation was £55,658.


The aggregate consideration receivable will leave Peel Hotels PLC with no net
debt and cash on deposit of approximately £2,000,000. The Company will own and
operate eight hotels after the sale of the Avon Gorge.


Current Trading


The financial period for the 6 months ending on Sunday 26 August 2007 finished
with turnover up 2.2% and Revpar up 4.2% when compared to the same period last
year. The Company's interim Results will be announced on Tuesday 9 October 2007.


Chairman Robert Peel said: 'Our interim results will show encouraging progress
from a trading perspective. In simple terms the net effect of the asset sales
announced today (apart from significant capital gain) will be to leave the
Company totally debt free at a time, perhaps when there is upwards pressure on
the cost of borrowing and downward pressure on the value of assets. This
environment should give the Company acquisition opportunities going forward.'


Enquiries:


Peel Hotels Plc

Robert Peel (Executive Chairman): 0207 266 1100


KBC Peel Hunt (Nominated Adviser and Broker)


Capel Irwin / Matt Goode 020 7418 8900



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