LEND LEASE REAL ESTATE INVESTMENTS AND VESTAR-ATHENS TO DEVELOP THE RITZ-CARLTON, HALF MOON BAY RESORT

Press Release: Lend Lease Real Estate Investments, Inc.

July 2, 1999 - San Francisco, CA - Lend Lease Real Estate Investments, Inc., has announced it has entered into a joint venture on behalf of an opportunistic investment fund comprised of institutional clients with Vestar-Athens to develop a Ritz-Carlton destination resort hotel and spa in Half Moon Bay, California. Construction of the 261-room oceanfront resort began in May 1999 and the hotel is expected to open in the fall of 2000.

"$50 million of financing for the project was arranged by Lend Lease's Finance Group and provided by The Prudential Life Insurance Company," said Herb Miller, Executive Vice President and head of Lend Lease's Financing group.

The joint venture created to develop and own the hotel is comprised of Vestar-Athens, a partnership of The Athens Group and Vestar Development Company, and Yarmouth Capital Partners, L.P. II, an opportunistic real estate investment fund managed by Lend Lease Real Estate Investments, Inc. Lend Lease is also involved with The Athens Group on other luxury destination developments in San Antonio, Vail, Scottsdale, Tucson and Laguna Beach.

The resort will be situated on 14.4 acres and developed in two components. The main hotel lodge will house approximately 211 guest rooms, a specialty dining room, a 14,000-square foot full-service health spa, retail space, and approximately 17,000-square-feet of meeting and function space. In addition, the resort will have three detached bungalow buildings with another 50 guestrooms. The resort will have full access to two adjoining world-class 18-hole championship golf courses.

Located along the Ocean Colony bluff-tops facing the Pacific Ocean at the southern end of Half Moon Bay, the resort will offer dramatic views of the ocean from all guest rooms. Half Moon Bay lies approximately 50 minutes from downtown San Francisco and 30 minutes from the San Francisco International Airport.

"We believe the Half Moon Bay property is the finest resort development site in the western U.S." said Kim Richards, President of The Athens Group. "The barrier to entry due to the complex land use regulatory process in northern California makes it impossible to duplicate this type of oceanfront resort development."

Designed by Hill Glazier Architects of Palo Alto, California, the resort exterior is inspired by the San Francisco Bay area "shingle style" vernacular. Natural exterior materials of cedar shingles and redwood trellises reinforce the building's relation to its natural setting on the coastline. The interior space will also reflect this style with hardwood floors, stone fireplaces and fine English furnishings.

"We saw The Ritz-Carlton, Half Moon Bay resort as an excellent investment for our fund clients," said Kevin Mallory, Executive Vice President and head of Lend Lease's Hospitality Group. "The unique location and strong Northern California economy, as well as the growing strength of the conference-leisure segment of the lodging industry make this a desirable addition to our fund's opportunistic real estate portfolio and we expect to achieve returns well above average through the investment," he said.

The Athens Group is a full service real estate development company, which specializes in the development of upscale resort communities, resort hotels, golf courses and related recreational properties. The Athens Group recently completed the initial development of the Hualalai Resort project on the Kona/Kohala coast of the Big Island of Hawaii. Hualalai is a master planned community residential resort, which features a 243-room Four Seasons resort hotel, an 18-hole championship golf course, sports club and spa, as well as a mix of luxury residential properties. The company currently maintains offices on the Big Island of Hawaii, Phoenix, Arizona; San Antonio, Texas; Laguna Beach and Half Moon Bay, California.

The Athens Group maintains a strategic alliance with Vestar Development Company. Vestar is a nationally recognized leader in the development and management of retail real estate, specializing in the development of shopping centers of 100,000-to 1-million-square-feet. Athens and Vestar enjoy a long-standing relationship, supporting each other by sharing or combining various resources and exploring new opportunities together. Vestar Development Company is based in Phoenix, Arizona.

Lend Lease Real Estate Investments has $28 billion in assets under management on five continents-North America, Europe, Asia, Australia and South America. The company ranks as the leading US manager of tax-exempt assets invested in real estate, and has $23 billion in its US real estate and mortgage portfolios. The company's US hotel portfolio totals $1 billion and includes 25 hotels.

Lend Lease Real Estate Investments is a subsidiary of Lend Lease Corporation (AUS: LLC), an international property and financial services group. In addition to real estate investments the Lend Lease group operates in the areas of project management and construction, property development, funds management, life insurance and information technology. Lend Lease Corporation has total funds under management of $45 billion and a market capitalization of $6 billion.

Contact: Mary Beth Lally 404-848-8662