Alexander Haagen Announces Stockholder Approval of Lazard Freres Affiliate's Investment of $235 Million of Common Stock.

MANHATTAN BEACH, Calif.--(BUSINESS WIRE)--Aug. 15, 1997--Alexander Haagen Properties Inc. (ASE:ACH) Friday announced that 98 percent of the voting stockholders approved the strategic equity investment by an affiliate of Lazard Freres Real Estate Investors LLC (LFREI) of $235 million in newly issued common shares at a purchase price of $15 per share.

The $235 million investment, to be made in stages over an 18-month period, represents a total of $15,666,666 newly issued common shares. Upon full funding, LFREI will own an equity interest in Alexander Haagen Properties of approximately 38 percent on a fully diluted basis (57 percent of the outstanding common stock, subject to certain voting restrictions and a negotiated standstill agreement).

LFREI has already purchased 1,306,434 shares and the company expects that they will purchase an additional 1 million shares for proceeds of $15 million in a transaction that will close Friday. As a result of these transactions, as of Friday, LFREI will own approximately 16.1 percent of the outstanding common stock. LFREI is a real estate investment affiliate of Lazard Freres & Co. LLC, a leading global investment bank.

In addition, as part of the terms of the agreement with LFREI, the company announced the resignation of three directors and the appointments of four new directors nominated by LFREI to a restructured 10 member board of directors. Warren Fix, James Hankla and Tom Bradley resigned from the board. Bradley will continue to work with the company in an advisory capacity. The new directors are: Arthur P. Solomon, Anthony E. Meyer, Robert Barnum and Edward P. Fox.

Arthur Solomon, a managing director of Lazard Freres & Co. LLC and head of the firm's real estate group, is responsible for all of Lazard's real estate activities, including the firm's real estate principal investments.

Prior to joining Lazard, Solomon was a partner and head of real estate investment banking at Drexel Burnham Lambert. Previous to that, he was chief executive officer of the Krupp Cos. and served in the Johnson Administration on the President's Task Force on Domestic and Intergovernmental Affairs. He later served as executive vice president and chief financial officer of the Federal National Mortgage Association (FNMA).

Solomon, who holds a Ph.D. from Harvard University, was a tenured faculty member at the Massachusetts Institute of Technology and served as executive director of the Harvard-MIT Joint Center for Urban Studies, one of the nation's premier domestic policy centers.

Anthony Meyer, a managing director and chief investment officer of Lazard Freres Real Estate Investors LLC is responsible for the investment of the firm's owned and managed investment funds.

Prior to joining Lazard, Meyer spent nearly 10 years with the Trammell Crow Group, the largest commercial real estate development, leasing and management company in the United States. He was a general partner and co-founder of Trammell Crow Ventures, its $3 billion real estate investment and finance affiliate. He was the youngest partner in Trammell Crow's history and later served as chief investment officer of Trammell Crow's real estate investment business.

Meyer is a director of Dermody Properties and American Apartment Communities and has served as an adjunct lecturer in real estate at Southern Methodist University and guest lecturer at New York University.

Robert Barnum is a private investor, often with the Robert Bass Group. Formerly, he was the president and chief operating officer of American Savings Bank. Earlier he served as the chief financial officer of First Nationwide and the Krupp Cos., a major national real estate and financial services firm.

Edward D. Fox is the senior partner of Commonwealth Pacific LLC, a major developer, owner and strategic adviser on office properties in the Western United States. Formerly, he was a senior partner and the president of Maguire-Thomas Partners. Earlier in his career, he was a partner at Arthur Andersen, the international accounting and consulting firm.

Alexander Haagen Properties, a fully-integrated, self-managed real estate investment trust, is a leading developer, owner and manager of retail shopping centers in the Western United States. The company owns or controls 41 properties, including 17 neighborhood/community shopping centers, eight promotional/power centers, two regional malls and 14 single-tenant facilities.

CONTACT: Alexander Haagen Properties Inc., Manhattan Beach

Stuart Gulland, 310/546-4520