EXHIBIT 99.1

                 AMERICAN RETIREMENT VILLAS PROPERTIES III, L.P.
                             245 FISCHER AVENUE, D-1
                          COSTA MESA, CALIFORNIA 92626

FOR IMMEDIATE RELEASE

October 5, 2001

AMERICAN RETIREMENT VILLAS PROPERTIES III L.P. RESPONDS TO C3 CAPITAL, LLC
TENDER OFFER

COSTA MESA, Calif. October 5, 2001 - ARV Assisted Living, Inc., the Managing
General Partner of American Retirement Villas Properties III L.P. (ARVP III),
today confirmed it has received notice of an unsolicited offer to purchase up to
10,000 limited partnership units of ARVP III for a net cash price of $300 per
unit in cash from C3 Capital, LLC, subject to reduction under certain
circumstances. The offer is subject to various conditions. The Managing General
Partner will review the offer, evaluate alternatives, and make a recommendation
regarding the offer promptly to the limited partners. The Managing General
Partner urges limited partners not to take any action with respect to the offer
until the Managing General Partner makes its recommendation.

American Retirement Villas Properties III, L.P. is the owner and operator of two
assisted living communities, which house and provide personal care and support
services to senior residents. The two assisted living communities currently in
operation are located in Camarillo, California and Chandler, Arizona and contain
an aggregate of 287 units.

Contact:   ARV Assisted Living Inc.
           Abdo H. Khoury, 714/751-7400