PRESS RELEASES

Hines Announces The Acquisition Of 1776 G Street In Washington, Dc

Transaction Marks Sixth Acquisition for Hines/CalPERS Joint Venture

6/30/1999

Washington, DC - Hines, the international real estate firm, announced today that on behalf of the National Office Partners Limited Partnership, a joint venture between the California Public Employees´ Retirement System (CalPERS) and Hines, it has acquired 1776 G Street in downtown Washington, DC. The property was purchased from a partnership managed by the building's developer, The Robert T. Foley Company. Jones Lang LaSalle represented the seller in the transaction.

1776 G Street is a 260,000-square-foot, eight-story office building located just one block from The White House, the Old Executive Office Building and other landmarks, including the New World Bank Headquarters, along historic Pennsylvania Avenue. Built in 1979, the building is currently 100% leased. Three prominent tenants - the World Bank, Abu Dhabi International Bank and American Intercontinental University - occupy nearly 96% of the office space. The property also includes approximately 10,000 square feet of retail space and a parking garage for 200 vehicles.

"This acquisition is especially meaningful to us because it provided an opportunity to purchase a quality project in a prime location in the city's west central business district submarket," said William Alsup, Hines' senior vice president for the Washington, DC region. " Our investment in 1776 G Street further demonstrates Hines' ongoing commitment to Washington, DC," Alsup added. National Office Partners was formed in July 1998 to maximize the value of a portion of CalPERS´ existing office portfolio as well as to add new investments to the portfolio through acquisition and development. 1776 G Street is the sixth office building acquisition made by National Office Partners during the past year bringing the portfolio size to 7.5 million square feet in 27 buildings across the United States, totaling over $1.3 billion in value.

"We are most enthusiastic about the addition of 1776 G Street to the National Office Partners' portfolio," said Daniel MacEachron, Hines vice president and National Office Partners portfolio manager. " This asset's location and its further value-enhancement potential are an excellent fit with our investment strategy. In addition, it complements CalPERS' existing Washington, D.C. office property investment, 1001 Pennsylvania Avenue, for which Hines also has management responsibility on behalf of CalPERS."

Hines has been active in the Washington, DC market since 1982. The firm's Washington area projects total more than seven million square feet of office space and represent many of the area's most significant office buildings. Development projects completed by Hines include Columbia Square at 13th and F Streets, NW; Franklin Square at 13th and I Streets, NW; Postal Square at Massachusetts Avenue and North Capitol Street, and 600 13th Street, NW. Through its on-going acquisition efforts, Hines has acquired several significant properties including One Franklin Square at 1301 K Street, NW; 370 L'Enfant Promenade; 700 11th Street, NW; and three office buildings in Rock Spring Park in Bethesda, Maryland. Hines is the development manager for the 800,000-square-foot Gannett/USA Today headquarters project under construction in Tysons, Virginia. Plans are also being completed for 4100 N. Fairfax, a 250,000-square-foot office building in the Ballston submarket in Arlington County in Northern Virginia and for 800,000 square feet of additional office development in Rock Spring Park.

Based in Houston, Texas, Hines is a privately owned firm involved in developing, managing and acquiring real estate as well as providing a wide range of advisory services. Hines controls a real estate portfolio that includes more than 600 properties representing approximately 188 million square feet of office, mixed-use, industrial, retail and residential properties as well as large master-planned communities and land developments. Hines' real estate portfolio is valued in excess of $9 billion.

CalPERS is the nation's largest public pension fund with assets totaling more than $155 billion, of which $7.4 billion is invested in real estate. The System provides retirement and health benefits to more than one million state and public employees and their families. For further information on CalPERS, please visit the System's Web site at www.calpers.ca.gov.