Exhibit 99.1

 American Retirement Corporation Completes Letter of Credit Facility

    NASHVILLE, Tenn.--(BUSINESS WIRE)--June 30, 2005--American
Retirement Corporation (NYSE:ACR), a leading national provider of
senior living housing and care, announced today that it had set up a
letter of credit facility with Bank of America.
    The facility is for $10.6 million and is collateralized by two
unencumbered assisted living communities. The initial use of the
letters of credit was to replace $8.4 million of cash being used to
collateralize reserves required by the state of Florida for several
entrance-fee communities. The cash that was released was used to
reduce debt. Additional letter of credit capacity can be added to the
facility.
    "This is a part of our strategy to use the improved financial
position of the Company to reduce our restricted cash and, in turn,
reduce debt," said Bill Sheriff, Chairman, President and CEO of
American Retirement Corporation. "We are pleased to establish this
facility with Bank of America, an institution with which we have
enjoyed a long-term relationship."

    Company Profile

    American Retirement Corporation is a national senior living and
health care services provider offering a broad range of care and
services to seniors, including independent living, assisted living,
skilled nursing and Alzheimer's care. Established in 1978, the Company
believes that it is a leader in the operation and management of senior
living communities, including independent living communities,
continuing care retirement communities, free-standing assisted living
communities, and the development of specialized care programs for
residents with Alzheimer's and other forms of dementia. The Company's
operating philosophy is to enhance the lives of seniors by striving to
provide the highest quality of care and services in well-operated
communities designed to improve and protect the quality of life,
independence, personal freedom, privacy, spirit, and dignity of its
residents. The Company currently operates 67 senior living communities
in 14 states, with an aggregate unit capacity of approximately 13,300
units and resident capacity of approximately 14,900. The Company owns
17 communities, leases 44 communities, and manages six communities
pursuant to management agreements.

    Risks of Forward-Looking Statements

    Statements contained in this press release may be deemed to
constitute forward-looking information made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements include all statements that are
not historical statements of fact and those regarding the intent,
belief or expectations of the Company or its management and are
subject to risks, uncertainties, and assumptions. Important factors
that could cause actual results to differ materially from the
forward-looking statements made in this press release include those
risks described in the Company's filings with the Securities and
Exchange Commission. The Company does not undertake any obligation to
publicly release any revisions to any forward-looking statements
contained herein to reflect events and circumstances occurring after
the date hereof or to reflect the occurrence of unanticipated events.

    CONTACT: American Retirement Corporation
             Ross C. Roadman, 615-376-2412