Exhibit 3.1   
  
  
                           AMENDED AND RESTATED
                        ARTICLES OF INCORPORATION
                                   OF
                        KAHLER REALTY CORPORATION
                                
  
              To form a Minnesota business corporation under and pursuant to
  the Minnesota Business Corporation Act, the following articles of
  incorporation are adopted:
  
                              ARTICLE 1.  NAME
                               
              The name of the corporation is Kahler Realty Corporation.
  
                        ARTICLE  2.  REGISTERED OFFICE
                                
              The address of the registered office of the corporation is 20
  Second Avenue Southwest, Rochester, Minnesota 55904.
  
                             ARTICLE 3.  PURPOSE
                               
              The corporation may engage in any lawful act or activity for
  which corporations may be formed under the Minnesota Business Corporation
  Act.  
  
                         ARTICLE 4.  AUTHORIZED SHARES
                               
         4.1  Authorized Capital Stock.  The total number of shares of Capital
  Stock ("Capital Stock") that the corporation is authorized to issue shall
  be 80,000,000 shares, consisting of 70,000,000 shares of common stock, par
  value $0.10 per share ("Common Stock") and 10,000,000 shares of preferred
  stock, par value $0.10 per share ("Preferred Stock").
  
         4.2  Common Stock. All shares of Common Stock shall be voting shares
  and shall be entitled to one vote per share.  Subject to any preferential
  rights of holders of Preferred Stock, holders of Common Stock shall be
  entitled to receive their ratable shares of such dividends or other
  distributions as may be declared by the Board of Directors from time to
  time and of any distribution of the assets of the corporation upon its
  liquidation, dissolution or winding up, whether voluntary or involuntary. 
  <PAGE>
         4.3  Preferred Stock.  The Board of Directors of the corporation is
  hereby authorized to provide, by resolution or resolutions adopted by such
  Board, for the issuance of Preferred Stock from time to time in one or
  more classes and/or series, to establish the designation and number of
  shares of each such class or series and to fix the relative rights and
  preferences of the shares of each such class or series, all to the full
  extent permitted by the Minnesota Business Corporation Act, as now enacted
  or hereinafter amended.
  
       ARTICLE 5.  RESTRICTIONS ON OWNERSHIP AND TRANSFER TO PRESERVE TAX
                      BENEFIT; REDEMPTION OF EXCESS STOCK
                                
         5.1  Definitions.  For the purposes of this Article 5, the following
  terms shall have the following meanings:
  
         "Beneficial Ownership" shall mean ownership of Capital Stock by a
  Person who is or would be treated as an owner of such Capital Stock either
  directly or through the application of Section 544 of the Code, as
  modified by Section 856(h) of the Code.  The terms "Beneficial Owner,"
  "Beneficially Owns" and "Beneficially Owned" shall have the correlative
  meanings.
  
         "Closing Price" with respect to any Capital Stock shall mean, for any
  day, the last reported sale price of such Stock regular way or, in case no
  sale takes place on such day, the average of the closing bid and asked
  prices regular way on such day, in either case as reported on the New York
  Stock Exchange Composite Tape, or, if such Stock is not listed or admitted
  to trading on such Exchange, on the principal national securities exchange
  on which such Stock is listed or admitted to trading, or, if such Stock is
  not listed or admitted to trading on any national securities exchange, on
  the Nasdaq National Market, or, if such Stock is not admitted for
  quotation on the Nasdaq National Market, the average of the high bid and
  low asked prices on such day as recorded by the National Association of
  Securities Dealers, Inc. through Nasdaq, or, if the National Association
  of Securities Dealers, Inc. through Nasdaq shall not have reported any bid
  and asked prices for such Stock on such day, the average of the bid and
  asked prices for such day as furnished by any New York Stock Exchange
  member firm selected from time to time by the corporation for such
  purpose, or, if no such bid and asked prices can be obtained from any such
  firm, the fair market value of one share of such Stock on such day as
  determined in good faith by the Board of Directors of the corporation.
  
         "Code" shall mean the Internal Revenue Code of 1986, as amended from
  time to time.
  
         "Constructive Ownership" shall mean ownership of Capital Stock by a
  Person who is or would be treated as an owner of such Capital Stock
  through the application of Section 318 of the Code, as modified by Section
  856(d)(5) of the Code.  The terms "Constructive Owner," "Constructively
  Owns" and "Constructively Owned" shall have the correlative meanings.
  <PAGE>
         "Merger Date" shall mean the effective date of any merger between the
  corporation and Kahler Corporation, a Delaware corporation.
  
         "Ownership" shall mean ownership, Beneficial Ownership or Constructive
  Ownership of Capital Stock by a Person.  The terms Owner, Owns and Owned
  shall have correlative meanings.
  
         "Ownership Limit" shall mean not more than 9.8% (in value or in number
  of shares, whichever is more restrictive) of the outstanding Capital
  Stock.
  
         "Person" shall mean an individual, corporation, partnership, estate,
  trust (including a trust qualified under Section 401(a) or 501(c)(17) of
  the Code), a portion of a trust permanently set aside for or to be used
  exclusively for the purposes described in Section 642(c) of the Code,
  association, private foundation within the meaning of Section 509(a) of
  the Code, joint stock company or other entity.
  
         "REIT" shall mean a Real Estate Investment Trust under Section 856 of
  the Code.
  
         "REIT Provisions" shall mean (i) all provisions of the Code relating to
  REITs and all regulations, rulings and cases promulgated or decided
  thereunder and (ii) the requirements of any taxing authority or
  governmental agency relating to REITs.
   
         "Transfer" shall mean any sale, transfer, gift, assignment,
  hypothecation, pledge, devise or other disposition of Capital Stock,
  including, without limitation, the (i) granting of any warrant, option or
  similar right exercisable for such Capital Stock, (ii) entering into of
  any agreement for the sale, transfer, gift, assignment, hypothecation,
  pledge, devise or other disposition of Capital Stock or any instrument or
  security described in clauses (i) or (iii) hereof or (iii) the sale,
  transfer, gift, assignment, hypothecation, pledge, devise or other
  disposition of any securities convertible into or exchangeable for Capital
  Stock (or any warrants, options, or similar rights to acquire any such
  exchangeable or convertible securities), whether voluntary or involuntary,
  whether of record, by operation of law or otherwise, and including, but
  not limited to, transfers of interests in other Persons that result in
  changes in the Ownership of Capital Stock.  The terms "Transferor" and
  "Transferee" shall have correlative meanings.
  
         5.2  Restriction on Ownership and Transfer.
  
         (a)  Except as provided in Section 5.7, from and after the Merger
  Date, no Person shall directly or indirectly Own Capital Stock in excess
  of the Ownership Limit.
  <PAGE>
         (b)  Except as provided in Section 5.7, from and after the Merger
  Date,  any Transfer (whether or not such Transfer is the result of a
  transaction entered into or through the Nasdaq National Market or any
  exchange upon which the Capital Stock may be traded) that, if effective,
  would result in any Person directly or indirectly Owning Capital Stock in
  excess of the Ownership Limit shall be void and of no force or effect as
  to the Transfer of that number of shares of Capital Stock that would be
  otherwise Owned by such Person in excess of the Ownership Limit, and the
  purported transfer of such shares will not be reflected on the
  corporation's stock record books.
  
         (c)  From and after the Merger Date, any Transfer (whether or not such
  Transfer is the result of a transaction entered into or through the Nasdaq
  National Market or any exchange upon which the Capital Stock may be
  traded) that, if effective, would result in the Capital Stock being
  beneficially owned (within the meaning of Section 856(a)(5) of the Code
  and determined as provided in Treasury Regulation  1.856-1(d)(2)
  promulgated thereunder) by less than 100 persons (as such term is used in
  Section 856(a)(5) of the Code)  shall be void and of no force or effect as
  to the Transfer of that number of shares of Capital Stock that would
  otherwise cause such 100 person minimum beneficial ownership requirement
  to be violated.
  
         (d)  From and after the Merger Date, any Transfer (whether or not such
  Transfer is the result of a transaction entered into or through the Nasdaq
  National Market or any exchange upon which the Capital Stock may be
  traded) or other event that, if effective, would result in the corporation
  being "closely held" within the meaning of Section 856(h) of the Code or
  which would otherwise result in the corporation failing to qualify as a
  REIT (including, but not limited to, a Transfer or other event that would
  result in the corporation directly or indirectly Constructively Owning an
  interest in a tenant that exceeds the limits described in Section
  856(d)(2)(B) of the Code), shall be void and of no force or effect as to
  the Transfer of that number of shares of Capital Stock or other event that
  would otherwise cause the corporation to be "closely held" within the
  meaning of Section 856(h) of the Code or which would otherwise result in
  the corporation failing to qualify as a REIT, and any purported Transfer
  of shares that would cause the same will not be reflected on the
  corporation's stock record books.
  
         5.3  Remedies.  If the Board of Directors, or its designee, should at
  any time determine in good faith that a Transfer or other event has taken
  place in violation of Section 5.2 or that a Person intends to acquire, has
  attempted to acquire or may acquire the Ownership of any shares of the
  corporation in violation of Section 5.2, the Board of Directors, or its
  designee, may take such action as it deems necessary or advisable to
  refuse to give effect to or to prevent such Transfer or other event,
  including, but not limited to, refusing to give effect to such Transfer or
  other event on the stock record books of the corporation or instituting
  any appropriate proceedings to enjoin such Transfer or other event. 
  Nothing contained in this Article 5 (but subject to Section 5.11) shall
  limit the authority of the Board of Directors to take such other action as
  <PAGE>
  it deems necessary or advisable to protect the corporation and the
  interests of its stockholders by preservation of the corporation's status
  as a REIT.
  
         5.4  Notice of Restricted Transfer.  Any Person who acquires, attempts
  to acquire or intends to acquire the Ownership of Capital Stock in
  violation of Section 5.2 shall immediately give written notice to the
  corporation of such event and shall provide to the corporation such other
  information as the corporation may request in order to determine the
  effect, if any, of such event on the corporation's status as a REIT.
  
         5.5  Owners Required To Provide Information.  From and after the
  Merger Date, each Person who is an Owner of outstanding shares of Capital
  Stock shall, upon demand by the corporation, disclose to the corporation
  in writing such information with respect to its Ownership of Capital Stock
  as the Board of Directors, or its designee, in its discretion deems
  necessary or appropriate to ensure the corporation's compliance with the
  REIT Provisions.  Whenever the Board of Directors deems it reasonably
  necessary to protect the tax status of the corporation as a REIT under the
  REIT Provisions, the Board of Directors may require a statement or
  affidavit from each stockholder or proposed Transferee of shares of
  Capital Stock setting forth the number of shares of Capital Stock already
  Owned by such Person and any related, associated or affiliated Person
  specified by the Board of Directors.  If, in the opinion of the Board of
  Directors, any proposed Transfer may jeopardize the qualification of the
  corporation as a REIT, the Board of Directors shall have the right, but
  not the duty, to refuse to permit such Transfer.  All contracts,
  agreements or other instruments that provide for the Transfer of shares of
  Capital Stock shall be subject to this Section 5.5.
  
         5.6  Ambiguity.  In the case of an ambiguity in the application of any
  of the provisions of this Article 5, including, but not limited to, any
  definition contained in Section 5.1, the Board of Directors shall have the
  power to determine the appropriate application of the provisions of this
  Article 5 with respect to any situation based on the facts known to it
  (subject, however, to the provisions of Section 5.11).
  
         5.7  Exceptions.  (a)  Subject to Sections 5.2(c), 5.2(d) and 5.7(c),
  the Board of Directors may, in its sole and absolute discretion, exempt a
  Person (including an underwriter in a public offering of shares of Capital
  Stock of the corporation or any Person in any transaction involving the
  issuance of Capital Stock by the corporation) from the Ownership Limit if
  the Board of Directors obtains such representations, agreements and
  undertakings from such Person as the Board of Directors, in its sole and
  absolute discretion, determines are necessary to  ensure that the
  qualification of the corporation as a REIT will not be jeopardized
  thereby.
  
         (b)  Prior to granting any exception pursuant to Section 5.7(a), the
  Board of Directors may, in its sole discretion, require a ruling from the
  Internal Revenue Service or an opinion of counsel, in either case in form
  and substance satisfactory to the Board of Directors, if it deems the same
  <PAGE>
  necessary or advisable in order to determine or ensure the corporation's
  status as a REIT; provided, however, that obtaining a favorable ruling or
  opinion shall not be required for the Board of Directors to grant an
  exception hereunder.
         
         (c)  The Board of Directors may, in its sole and absolute discretion,
  at any time revoke any exception granted pursuant to Section 5.7(a), and
  upon such revocation, the provisions of this Article 5 shall immediately
  become applicable to the Person to whom the exemption was granted and all
  Capital Stock of the corporation Owned or proposed to be Owned by such
  Person.  A decision to exempt or refuse to exempt from the Ownership Limit
  the Ownership of shares of Capital Stock or to revoke an exemption
  previously granted may be based on any reason whatsoever, including, but
  not limited to, the preservation of the corporation's qualification as a
  REIT.
  
         5.8  Legend.  Each certificate for Capital Stock of the corporation
  shall bear the following legend:
  
         "The shares of Capital Stock represented by this certificate are
  subject to restrictions on ownership and transfer for the purpose of the
  issuer's qualification for and maintenance of its status as a Real Estate
  Investment Trust under the Internal Revenue Code of 1986, as amended.  No
  Person may Own Capital Stock of the issuer in excess of 9.8% (in value or
  in number of shares, whichever is more restrictive) of the outstanding
  Capital Stock of the issuer, with certain further restrictions and
  exceptions set forth in the issuer's Articles of Incorporation.  Any
  Person who attempts to Own Capital Stock in excess of the above
  limitations must immediately notify the issuer.  TRANSFERS IN VIOLATION OF
  THE RESTRICTIONS DESCRIBED ABOVE MAY BE VOID AND OF NO FORCE OR EFFECT.
  
         In addition, upon the occurrence of certain events, if the restrictions
  on Ownership are violated, the  Capital Stock represented hereby may be
  purchased by the issuer or its designee.  The issuer will furnish to the
  holder hereof upon request and without charge a complete written statement
  of the terms and conditions of such repurchase right.  Requests for such
  a statement should be directed to the issuer's registered office in
  Minnesota.  All capitalized terms in this legend have the meanings given
  them in the issuer's Articles of Incorporation. "
  
         5.9  Separability.  If any provision of this Article 5 or any
  application of any such provision is determined to be invalid by any
  federal or state court having jurisdiction, the validity of the remaining
  provisions of this Article 5 shall not be affected and other applications
  of such provisions shall be affected only to the extent necessary to
  comply with the determination of such court.
  
         5.10 Corporation's Purchase Right.  Any shares of Capital Stock
  ("Excess Stock") held of record by any shareholder in excess of the
  Ownership Limitation shall be deemed to have been offered for sale to the
  corporation, or its designee, at a price per share equal to the lesser of
  (i) the price per share paid by the shareholder in the transaction that
  <PAGE>
  created such Excess Stock (or, if the shareholder did not give value for
  the Excess Stock, the Closing Price of the class of Capital Stock
  constituting such Excess Stock on the date of the Transfer or other event
  that gave rise to the Excess Stock), (ii) the Closing Price of the class
  of Capital Stock constituting such Excess Stock on the date the
  corporation, or its designee, gives notice of acceptance of such offer,
  (iii) the Closing Price of the class of Capital Stock constituting such
  Excess Stock on the date the corporation, or its designee, purchases such
  Excess Stock and (iv) the maximum price allowed under the applicable
  provisions of Minnesota law.  Any decision by the corporation to purchase
  shares of Excess Stock or to designate a person to purchase such stock,
  shall be made by the Board of Directors of the corporation in its sole and
  absolute discretion.
  
         5.11 Settlement.  Nothing in this Article 5 shall preclude the
  settlement of any transaction entered into through the Nasdaq National
  Market or any exchange upon which the Capital Stock of the corporation may
  be traded.
  
                     ARTICLE 6.  NO CUMULATIVE VOTING
                               
              Unless otherwise provided in the resolutions of the Board of
  Directors establishing a class or series of Preferred Stock, there shall
  be no cumulative voting by shareholders of the corporation.
  
                      ARTICLE 7.  NO PREEMPTIVE RIGHTS
                               
              Unless otherwise provided in the resolutions of the Board of
  Directors establishing a class or series of Preferred Stock the
  shareholders of the corporation shall not have any preemptive rights to
  subscribe for or acquire securities or rights to purchase securities of
  any class, kind, or series of the corporation.
  
                       ARTICLE 8.  BOARD OF DIRECTORS
                                
              The affairs of the corporation shall be conducted by a Board of
  Directors.  The directors shall be divided into three classes:  Class I;
  Class II and Class III; each such class, as nearly as possible, to have
  the same number of directors.  The term of office of the initial Class I
  directors shall expire at the annual shareholders meeting in 1995, the
  term of office of the initial Class II directors shall expire at the
  annual shareholders meeting in 1996, and the term of office of the initial
  Class III directors shall expire at the annual shareholders meeting in
  1997.  At each annual election of directors by the shareholders, the
  directors chosen to succeed those whose terms have then expired shall be
  identified as being of the same class as the directors they succeed and
  shall be elected by the shareholders for a term expiring at the third
  succeeding annual election of directors.  In all cases, directors shall
  hold office until their respective successors are elected by the
  shareholders and have qualified.
  <PAGE> 
                     ARTICLE 9.  WRITTEN ACTION BY DIRECTORS
                               
              An action required or permitted to be taken at a meeting of the
  board of directors of the corporation may be taken by a written action
  signed, or counterparts of a written action signed in the aggregate, by
  all of the directors unless the action need not be approved by the
  shareholders of the corporation, in which case the action may be taken by
  a written action signed in the aggregate, by the number of directors that
  would be required to take the same action at a meeting of the board of
  directors of the corporation at which all of the directors were present.
  
  
                         ARTICLE 10.  DIRECTOR LIABILITY
                               
              A director of this corporation shall not be personally liable to
  the corporation or its stockholders for monetary damages for breach of
  fiduciary duty as a director, except for liability (i) for any breach of
  the director's duty of loyalty to the corporation or its stockholders;
  (ii) for acts or omissions not in good faith or which involve intentional
  misconduct or a knowing violation of law; (iii) under sections 302A.559 or
  80A.23 of the Minnesota Statutes; or (iv) for any transaction from which
  the director derived an improper personal benefit.
  
              If the Minnesota Business Corporation Act is hereafter amended to
  authorize any further limitation of the liability of a director, then the
  liability of a director of the corporation shall be eliminated or limited
  to the fullest extent permitted by the Minnesota Business Corporation Act,
  as amended.
  
              Any repeal or modification of the foregoing provisions of this
  Article 10 by the shareholders of the corporation shall not adversely
  affect any right or protection of a director of the corporation existing
  at the time of such repeal or modification.
  
   
                    ARTICLE 11.  LIMITATION ON INDEBTEDNESS
                                
              From and after the fifteenth day following receipt by the
  corporation of the proceeds of the first Public Offering after the
  effective date of these Amended and Restated Articles of Incorporation,
  the corporation shall not incur or at any time suffer to exist aggregate
  Consolidated Indebtedness outstanding at any time in excess of 40% of the
  aggregate Consolidated Hotel Investment of the corporation after giving
  effect to the use of proceeds from any Consolidated Indebtedness. 
  "Consolidated Indebtedness" shall mean (a) obligations for borrowed money,
  (b) obligations representing the deferred purchase price of property
  (other than accounts payable incurred in the ordinary course of business),
  and (c) obligations which are evidenced by notes, acceptances or other
  instruments.  "Consolidated Hotel Investment" shall mean the total amount
  invested in hotel properties at cost and before accumulated depreciation. 
  <PAGE>
  Consolidated Indebtedness and Consolidated Hotel Investment shall be
  determined on a consolidated basis in accordance with generally accepted
  accounting principles in effect at any date of determination.  "Public
  Offering" shall mean the sale by the corporation of shares of Common Stock
  in an offering registered on Form S-11 under the Securities Act of 1933,
  as amended.
  
  <PAGE>
    
                          ARTICLES OF AMENDMENT
                                    OF
                        ARTICLES OF INCORPORATION
                                    OF
                        KAHLER REALTY CORPORATION
                                
  
              The undersigned, Harold W. Milner, President and Chief Executive
  Officer of Kahler Realty Corporation, a Minnesota Corporation (the
  "Corporation"), hereby certifies that the following resolution was duly
  adopted by the shareholders and the board of directors of the Corporation
  pursuant to Chapter 302A of the Minnesota Business Corporation Act at duly
  convened board of directors and shareholder meetings on April 27, 1995,
  and that such resolution has not been subsequently modified or rescinded:
  
              RESOLVED, that the Articles of Incorporation of the Corporation
  are hereby amended to delete Article 11 of such Articles of Incorporation
  in its entirety.
  
              IN WITNESS WHEREOF, the undersigned President and Chief Executive
  Officer of the Corporation, being duly authorized on behalf of the
  Corporation, has executed this document as of June 27, 1995.
  
  
                                  _____/s/ Harold W. Milner_____
                                  Harold W. Milner
                                  President and Chief Executive Officer