Arden Realty Inc. Reports Second-Quarter 1999 Earnings.

LOS ANGELES--(BUSINESS WIRE)--July 21, 1999--

Arden Realty Inc. (NYSE:ARI), a Los Angeles-based office real estate investment trust (REIT), today reported Funds From Operations (FFO) for the second quarter of 1999 of $42.8 million or $.65 per share on a fully diluted basis, compared with FFO of $37.7 million or $.58 per share on a fully diluted basis for the second quarter of 1998.

Revenues for the second quarter of 1999 were $83.4 million, compared with $71.2 million for the second quarter of 1998. Net income for the second quarter of 1999 was $24.7 million, or $.39 per share on a fully diluted basis, compared with $23.6 million or $.38 per share on a fully diluted basis for the second quarter of 1998.

Adjusting FFO by excluding the straight-line rent adjustment and providing a reserve for recurring capital expenditures, tenant improvements and leasing commissions resulted in Funds Available for Distribution (FAD) for the second quarter of 1999 of $34.0 million or $.52 per share on a fully diluted basis, compared with FAD of $30.2 million or $.46 per share on a fully diluted basis for the second quarter of 1998. A dividend of $.445 per share was declared for the second quarter of 1999.

Total debt was $968.8 million, representing approximately 37.5% of total market capitalization at June 30, 1999.

Financial schedules follow. A detailed analysis of the quarter's results can be obtained by viewing the Supplemental Information available in the Investor Information section (Financial Reports) of the company's Web site at www.ardenrealty.com, or by calling the company contact listed below.

Arden Realty Inc. is a self-administered, self-managed REIT which acquires, develops, renovates, operates and leases commercial office properties located in Southern California. As of June 30, 1999, the company's portfolio contained 141 properties and approximately 18.4 million square feet.

Statements in this news release which are not historical may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although the company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the company's expectations include the availability and cost of capital for future investments, competition within the industry, real estate and economic conditions, and other risks detailed from time to time in the company's SEC filings. -0-

                           ARDEN REALTY INC.
                      CONSOLIDATED BALANCE SHEETS
                            (in thousands)

                                             June 30,      Dec. 31,
                                               1999          1998
                                            (unaudited)
Assets
Investment in real estate:
  Commercial properties                     $2,288,386    $2,173,194
  Less accumulated depreciation               (114,910)      (84,754)
                                             2,173,476     2,088,440
  Properties under development                 177,696       149,629
      Net investment in real estate          2,351,172     2,238,069

Cash and cash equivalents                        5,460         4,578
Restricted cash                                 17,559        12,409
Rent and other receivables                       9,148         9,024
Mortgage notes receivable, net of discount      14,082        14,329
Deferred rent                                   20,571        17,004
Prepaid financing and leasing costs, net        39,085        32,759
Prepaid expenses and other assets                6,661         3,747
      Total assets                          $2,463,738    $2,331,919

Liabilities and Stockholders' Equity
Mortgage loans payable                      $  662,178    $  544,027
Unsecured lines of credit                      306,613       296,450
Accounts payable and accrued expenses           30,200        21,687
Security deposits                               14,426        13,933
Dividends payable                               28,167        26,210
      Total liabilities                      1,041,584       902,307

Minority interest                               40,895        56,222

Stockholders' Equity
Common stock                                       632           624
Additional paid-in capital                   1,382,734     1,374,813
  Notes receivable from
   officers-shareholders                        (2,107)       (2,047)
  Total stockholders' equity                 1,381,259     1,373,390
  Total liabilities and stockholders'
   equity                                    2,463,738    $2,331,919


                           ARDEN REALTY INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
               (in thousands, except per-share amounts)
                              (unaudited)

                              For the Three Months  For the Six Months
                                  Ended June 30,      Ended June 30,
                                  1999     1998       1999      1998
Revenue:
     Revenues from rental
      operations:
     Rent                       $72,331  $63,522   $141,841  $112,211
     Tenant reimbursements        2,869    2,174      6,336     4,057
     Parking, net of expenses     3,575    2,882      6,757     5,532
     Other rental operations      3,937    1,925      7,114     3,462
                                 82,712   70,503    162,048   125,262
Interest and other income           671      695      1,341     2,153
   Total revenue                 83,383   71,198    163,389   127,415

Expenses:
   Property expenses:
     Repairs and maintenance      8,255    6,798     15,925    12,150
     Utilities                    6,538    5,982     12,879    10,598
     Real estate taxes            5,669    5,372     11,416     9,472
     Insurance                      988    1,076      1,970     1,882
     Ground rent                    313      178        494       356
     Marketing and other          2,681    2,137      5,270     3,823
       Total property expenses   24,444   21,543     47,954    38,281

   General and administrative     1,687    1,388      3,183     3,023
   Interest                      14,455   10,539     27,638    19,151
   Depreciation and amortization 17,173   12,930     33,388    24,226

Income before minority interest  25,624   24,798     51,226    42,734
Minority interest                  (971)  (1,183)    (2,182)   (2,935)
Net income                      $24,653  $23,615   $ 49,044  $ 39,799

Net income per share:
     Basic                      $  0.39  $  0.38   $   0.78  $   0.73
     Diluted                    $  0.39  $  0.38   $   0.78  $   0.72

     Weighted average common
      shares:
     Basic                       62,984   62,051     62,755    54,874
     Diluted                     63,136   62,248     62,879    55,081


                           ARDEN REALTY INC.
                 CALCULATION OF FUNDS FROM OPERATIONS
                 AND FUNDS AVAILABLE FOR DISTRIBUTION
               (in thousands, except per-share amounts)
                              (unaudited)

                              For the Three Months  For the Six Months
                                   Ended June 30,     Ended June 30,
                                   1999     1998      1999     1998
Funds From Operations:
Net income                       $24,653  $23,615   $49,044  $39,799
Plus-
  Depreciation and amortization
    of real estate assets         17,173   12,930    33,388   24,226
  Minority interest                  971    1,183     2,182    2,360/a

Funds From Operations            $42,797  $37,728   $84,614  $66,385

Funds Available for Distribution:
Funds From Operations            $42,797  $37,728   $84,614  $66,385
Less-
  Straight-line rent adjustment  ( 1,958) ( 1,738)  ( 3,567) ( 2,991)
  Capital expenditure, tenant
    improvement and leasing
    commission reserve           ( 6,856) ( 5,810)  (13,695) (10,280)

Funds Available for Distribution $33,983  $30,180   $67,352  $53,114

Per share:
Funds From Operations - Diluted  $  0.65  $  0.58   $  1.29  $  1.14
Funds Available for Distribution
 - Diluted                       $  0.52  $  0.46   $  1.03  $  0.91
Distributions declared           $ 0.445  $  0.42   $  0.89  $  0.84

Weighted average shares and
 Operating Partnership Units
 outstanding - Diluted            65,661   65,354    65,633   58,365


(a) Excludes $575,000 in distributions made to the former minority
partner in the World Savings Center office property.

The White Paper on Funds From Operations (FFO) approved by the
Board of Governors of the National Association of Real Estate
Investment Trusts in March 1995 defines FFO as net income, computed in
accordance with generally accepted accounting principles, excluding
gains or losses from debt restructuring and sales of property, plus
real estate related depreciation and amortization and after
adjustments for unconsolidated partnerships and joint ventures and
extraordinary or unusual items that distort the comparability of FFO
from period to period. Funds Available for Distribution is defined as
FFO, excluding straight-line rent adjustments and less a reserve for
capital expenditures, tenants improvements and leasing commissions.