MORGAN STANLEY INVESTS IN BLUEGREEN

Press Release: Bluegreen Corporation

March 31, 1999
Bluegreen Corporation today announced that Morgan Stanley Real Estate Fund III, L.P. and its affiliated real estate funds have purchased an additional $10 million, or 1,176,471 shares, of Bluegreen common stock at a purchase price of $8.50 per share.

Bluegreen intends to use the proceeds from this purchase to fund the expansion of its business, including the pursuit of acquisitions, and for general corporate purposes.

In August 1998 Bluegreen and MSREF announced an agreement under which MSREF agreed to purchase up to $50 million in Bluegreen common stock over an 18-month period at a purchase price of $8.50 per share. To date, MSREF has purchased $35 million, or approximately 4.1 million shares, of Bluegreen common stock.

George Donovan, President and Chief Executive Officer of Bluegreen Corporation, stated, "As part of this $10 million purchase, MSREF has also agreed to remove all conditions to their obligation to purchase further shares included in the original agreement. Bluegreen may at its option sell the remaining $15 million to MSREF at the $8.50 per share price at any time through the expiration of the agreement."

The Company also announced that in March, Heller Financial, Inc. ("Heller'') purchased from a wholly-owned special purpose subsidiary of Bluegreen, without recourse to Bluegreen or the subsidiary, timeshare receivables with an aggregate principal balance of approximately $9 million and an interest rate yield to Heller of 6.475%. Proceeds to Bluegreen totaled approximately $8.7 million. Heller has now purchased approximately $55 million of Bluegreen's timeshare receivables. Approximately $45 million of additional timeshare receivables may be sold to Heller under the existing $100 million purchase facility, subject to customary conditions and eligible notes.

Mr. Donovan said, "As we enter our fiscal year 2000 today, we look back with pride on a year in which Bluegreen expects to report record revenues and net income, as well as an expanded presence in the growing timeshare industry. These agreements with MSREF and Heller have resulted in Bluegreen having the strongest balance sheet in our Company's history, providing us with the capital to grow our business while simplifying our capital structure, reducing our loan exposure and strengthening our cash flow."

Bluegreen is one of the leading companies engaged in the acquisition, development, marketing and sale of timeshare resorts and residential land. The Company's timeshare resorts are located in a variety of popular vacation destinations including the Smoky Mountains of Tennessee; Myrtle Beach, South Carolina; Charleston, South Carolina; Branson, Missouri; Orlando, Florida; Wisconsin Dells, Wisconsin; and Aruba, while its land operations are predominantly located in the Southeastern and Southwestern United States.