ADOPTION OF UITF ABSTRACT 34

Unite Group PLC
17 June 2002

Date:                       17 June 2002

On behalf of:               The UNITE Group plc ('UNITE')

Embargoed until:            0700hrs



The UNITE Group plc
ADOPTION OF UITF ABSTRACT 34

As indicated in the Group's 2002 Report and Accounts, an in common with all
other companies in its sector, The UNITE Group plc ('UNITE') will adopt UITF
Abstract 34: Pre-contract costs, issued by the Accounting Standards Board on 21
May 2002, for its current financial year. Accordingly it will restate its
figures for the year to 31 December 2001.  Whilst this new accounting policy
does not materially affect the Group's Net Asset Value, it does affect the way
in which certain costs are accounted for in UNITE's financial statements,
resulting in a significant reduction in reported profits.

New accounting policy

UITF Abstract 34 requires all costs relating to bidding for or securing a
contract, and which are incurred before it is 'virtually certain' that a
contract will proceed, to be expensed through the profit and loss account as
incurred.  These costs are defined as 'pre-contract costs'.  The Group incurs
pre-contract costs in respect of both development activity and PPP-type
contracts and its historic accounting policy has been:

•         in respect of its development activity - to capitalise all costs
relating to securing a development (whether pre-contract or post-contract) as
part of the overall cost of developing the asset, thereby reducing the
revaluation uplift achieved on that project.  Costs relating to projects that
ultimately prove abortive have been expensed to the profit and loss account;

•         in respect of PPP-type contracts - all bidding costs relating to a
particular project (whether incurred prior to or subsequent to appointment as
Preferred Bidder) have been capitalised once the Group has been appointed
Preferred Bidder, to be written off over the life of the concession. Costs
incurred during an accounting period on tender processes prior to Preferred
Bidder status being achieved, or in relation to projects that have ultimately
proved abortive, have been expensed to the profit and loss account.

In adopting UITF Abstract 34, UNITE will now apply the following policy:

•         all costs incurred on development activity prior to contracts being
exchanged will be expensed through the profit and loss account as incurred.
Costs incurred following exchange of contracts will continue to be attributed
directly to the cost of the asset;

•         all bidding costs relating to PPP-type contracts which are incurred
prior to Preferred Bidder status being achieved will be expensed through the
profit and loss account as incurred.  Bidding costs incurred after this point
will be capitalised within the overall cost of the asset. Costs incurred in
relation to projects that ultimately prove abortive will continue to be expensed
to the profit and loss account.

Financial impact

For the year to 31 December 2001 the Board estimates that £5.6 million of
previously capitalised costs will be treated as pre-contract costs under UITF
Abstract 34, plus the Group's share of £0.4 million of similar costs arising in
its joint venture, resulting in an estimated restated loss before tax of
approximately £2.9 million (5.1 pence per share).  A fully restated profit and
loss account is set out in Note 1.

The adoption of UITF Abstract 34 does not materially affect Net Asset Value
although there is a slight timing difference in the recognition of development
uplifts.  Revaluation uplifts achieved on developments increase by an amount
equal to the associated pre-contract costs expensed through the profit and loss
account.  In respect of PPP projects, the accelerated expensing of bidding costs
results in increased profits over the life of the concession.

At 31 December 2001 the Board estimates that these timing differences totalled
£5.0 million (7.5 pence per share), of which approximately £3.1million related
to developments and £1.9million related to PPP projects on which the Group had
achieved Preferred Bidder status.  As a result, restated Net Asset Value at 31
December 2001 is estimated to be £202.1 million (297.3 pence per share). A fully
restated balance sheet is set out in Note 2.

Impact on dividend policy

Given the significant impact of UITF Abstract 34 on the Group's earnings,
UNITE's directors intend to hold the current total annual dividend payment at
2.5 pence per share until reported earnings enable a progressive dividend policy
to be resumed.

Outlook

The development pipeline continues to grow in line with the Board's plan, with a
total of 6,092 beds secured and announced since 1 January 2002.  Current trading
is in line with expectations and the Board is particularly pleased with the
level of bookings confirmed for the forthcoming academic year.  The returns
UNITE achieves on its developments and PPP projects are not affected by the
adoption of UITF Abstract 34 and the board believes that the outlook for the
Group remains extremely positive.

Commenting on the announcement, Nicholas Porter, Chief Executive of The UNITE
Group plc, said:

'Fundamentally, this new accounting policy does not effect our business approach
and has no material impact on our net asset value.  Our business continues to
grow in line with our expectations and we are delighted with the progress being
made on all fronts.  We continue to reinforce our position in the student and
NHS key worker accommodation markets across the UK and now operate in 30 towns
and cities, in nine of which UNITE has over 1,000 beds.'



                                      ENDS



For further information please contact:

Nicholas Porter, Chief Executive Officer            Tel: [phone]
Simon Bernstein, Chief Financial Officer
The UNITE Group plc

Emma Kane/Scott Convoy                              Tel: [phone]
Redleaf Communications Ltd                          Mob: [phone]

Notes to Editors:

•         UNITE, the UK's student and key worker accommodation provider, is
operational in 30 towns and cities across the UK, of which nine will comprise
over 1,000 beds on completion

•         The UNITE Group plc (UTG) is listed on the London Stock Exchange

•         Further information on UNITE is available at the Company's website
at www.unite-group.co.uk




NOTES:

1.      Restated profit and loss account for the year to 31 December 2001

                                                          2001 Reported Estimated                   2001
                                                                        Adjustment              Restated
                                                   Audited                   Unaudited         Unaudited
                                                                   £000           £000              £000
Group turnover and share of
turnover of joint venture                                        26,312              -            26,312
Less: share of turnover of joint venture                        (1,813)              -           (1,813)
Group turnover                                                   24,499              -            24,499
Cost of sales                                                   (8,545)              -           (8,545)
Gross profit                                                     15,954              -            15,954

Administrative expenses                                         (6,917)        (5,629)          (12,546)
Group operating profit                                            9,037        (5,629)             3,408

Share of operating profit of joint                                1,428          (183)             1,245
Venture
Profit on disposal of investment                                    262              -               262
Properties
Profit on ordinary activities before

Interest and taxation                                            10,727        (5,812)             4,915
Interest receivable                                                 560              -               560
Interest payable and similar charges
   Group                                                        (7,201)              -           (7,201)
   Joint venture                                                (1,167)              -           (1,167)
Profit on ordinary activities before                              2,919        (5,812)           (2,893)
Taxation
Taxation                                                              -              -                 -
Profit for the financial year                                     2,919        (5,812)           (2,893)
Dividends paid and proposed                                     (1,825)              -           (1,825)
Retained profit for the financial year                            1,094        (5,812)           (4,718)
Earnings per share:
Basic                                                             5.19p       (10.33p)           (5.14p)
Excluding goodwill amortisation                                   5.32p       (10.33p)           (5.01p)
Diluted                                                           5.13p       (10.21p)           (5.08p)

2. Restated balance sheet as at 31 December 2001

                                                    2001 reported         Adjustment               2001
                                                                                               Restated
                                                          Audited          Unaudited          Unaudited
                                                             £000               £000               £000
Fixed assets
Intangible assets                                          12,886                  -             12,886
Tangible assets
- Investment and development                              376,566            (3,034)            373,532
  Properties
- Other tangible fixed assets                               7,921                  -              7,921
                                                          384,487            (3,034)            381,453
Investments
Joint venture undertakings

 - share of gross assets                                   51,252               (93)             51,159
 - share of gross liabilities                            (37,950)                  -           (37,950)

                                                           13,302               (93)             13,209


Total fixed assets                                        410,675            (3,127)            407,548


Current assets

Stocks                                                      4,384            (1,920)              2,464
Debtors                                                    33,371                  -             33,371
Cash at bank and in hand                                    5,984                  -              5,984
                                                           43,739            (1,920)             41,819
Creditors: amounts falling due within
one year

Build facilities and other short term                    (42,354)                  -           (42,354)
borrowings (including convertible debt
debt)
Other creditors                                          (50,399)                  -           (50,399)

Net current liabilities                                  (49,014)            (1,920)           (50,934)


Total assets less current liabilities                     361,661            (5,047)            356,614
Creditors: amounts falling due after
more than one year
Long term borrowings                                    (151,931)                  -          (151,931)
Other creditors                                           (2,625)                  -            (2,625)

Net assets                                                207,105            (5,047)            202,058

Capital and reserves
Called up share capital                                    16,989                  -             16,989
Share premium account                                      71,685                  -             71,685
Merger reserve                                             40,177                  -             40,177
Revaluation reserve                                        73,588              7,928             81,516
Profit and loss account                                     4,666           (12,975)            (8,309)

Equity shareholders' funds                                207,105            (5,047)            202,058

Net asset value per share                                  304.8p             (7.5)p             297.3p

3. Estimates

All of the financial data set out in this announcement, other than the
unadjusted figures for the year to 31 December 2001, is unaudited and represents
the Board's estimates.

Past performance cannot be relied on as a guide to future performance.

The financial information set out above does not constitute The UNITE Group
plc's statutory group accounts for the year ended 31 December 2001, but it is
derived from those accounts. Statutory group accounts for the year ended 31
December 2001 have been delivered to the registrar of companies. The auditors'
report on those accounts was unqualified and did not contain a statement under
section 237 (2) or (3) of the Companies Act 1985.

The Group will be adopting FRS 19 in respect of deferred tax for its financial
year to 31 December 2002.  The Board is currently assessing the likely impact of
this new accounting standard and the above restatement takes no account of this
impact.





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