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American Casino & Entertainment Reports Results Up

23 April 2004

MOUNT KISCO, New York – (PRESS RELEASE) -- American Real Estate Partners, L.P. (NYSE: ACP) announced today the 2003 full year and estimated 2004 first quarter financial results for American Casino & Entertainment Properties LLC ("ACEP"), an indirect wholly-owned subsidiary.

As previously announced, on January 5, 2004, ACEP entered into an agreement to acquire two Las Vegas casino/hotels, Arizona Charlie's Decatur and Arizona Charlie's Boulder from Carl C. Icahn and an entity affiliated with Mr. Icahn, for aggregate consideration of $125.9 million. The closing of the acquisition is subject to certain conditions, including among other things, obtaining all approvals necessary under the Nevada gaming laws. The terms of the transaction were approved by AREP's audit committee. Upon receiving all approvals necessary under gaming laws and upon closing of the acquisition, AREP's subsidiary, American Real Estate Holdings Limited Partnership, will transfer 100% of the common stock of Stratosphere Corporation to ACEP. As a result, following the acquisition and contribution, ACEP will own and operate three casino/hotels in the Las Vegas metropolitan area.

Also, as previously announced, in January 2004, ACEP closed on its offering of senior secured notes due 2012. The notes, in the aggregate principal amount of $215 million, bear interest at the rate of 7.85% per annum. The proceeds are being held in escrow pending receipt of all approvals necessary under gaming laws and certain other conditions in connection with the acquisition of Arizona Charlie's Decatur and Arizona Charlie's Boulder and the contribution of the Stratosphere. ACEP intends to use the proceeds of the notes offering to finance the acquisitions and to repay intercompany indebtedness and for a distribution to AREP.

The following financial results reflect the combined operating results of the Stratosphere, Arizona Charlie's Decatur and Arizona Charlie's Boulder properties. Combined net revenues for the year ended December 31, 2003 amounted to $262.8 million, an increase of $12.8 million, or 5.1%, over the year ended December 31, 2002. Combined EBITDA for the year ended December 31, 2003 was $45.5 million as compared to combined EBITDA of $31.7 million for the year ended December 31, 2002.

"Our year end results exceeded our expectations. We attribute this to enhanced customer flow at all three of the casino/hotels. Strong local and improved national economies, diligent expense controls, expanded and improved facilities and enhanced targeting of our respective markets were the key drivers of our results," said Richard Brown, ACEP's President and Chief Executive Officer. AREP has furnished ACEP's 2003 audited financial statements and Management's Discussion and Analysis of Results of Operations and Financial Condition to the SEC on a Form 8-K filed on the date hereof.

AREP estimates that, for the three months ended March 31, 2004, ACEP's combined net revenues will be approximately $75.0 million compared to combined net revenues of $66.0 million for the three months ended March 31, 2003. For the three months ended March 31, 2004, ACEP's combined EBITDA is estimated to be approximately $20.8 million compared to combined EBITDA of $12.3 million for the three months ended March 31, 2003. AREP estimates that, for the twelve months ended March 31, 2004, ACEP's combined net revenues will be approximately $271.8 million compared to combined net revenues of $255.7 million for the twelve months ended March 31, 2003. For the twelve months ended March 31, 2004, ACEP's combined EBITDA is estimated to be approximately $54.0 million compared to combined EBITDA of $34.6 million for the twelve months ended March 31, 2003. "Our first quarter results easily surpassed our budgeted numbers and we are pleased with our performance to date, especially since all three casino/hotels are EBITDA positive," remarked Mr. Brown.

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