Avalonbay Communities Breaks Ground On High-Rise Luxury Apartment Community.

Business Editors

ALEXANDRIA, Va.--(BUSINESS WIRE)--August 28, 2000

First High-Rise Apartment Community on the

Lower San Francisco Peninsula in 35 Years

AvalonBay Communities Inc. (NYSE and PCX symbol "AVB") announced today that it began construction on a high-rise luxury apartment community in Mountain View, Calif. The community, to be known as Avalon Towers on the Peninsula, will feature 211 apartment homes in two 11-story buildings.

Located in the heart of the Silicon Valley, Avalon Towers on the Peninsula marks the first luxury high-rise apartment community development on San Francisco's Lower Peninsula within the last 35 years.

Avalon Towers on the Peninsula enjoys close proximity to Stanford University, Palo Alto and Los Altos, including numerous shops and restaurants and a variety of recreational activities including golf, hiking and biking trails, concert halls and performing arts centers and spas. Conveniently located near several major highways, the VTA Light Rail and the Cal Train and minutes away from some of the country's top technology firms, Avalon Towers on the Peninsula is consistent with AvalonBay's "smart growth" strategy, which is aimed at fostering the development of residential communities around mass transit corridors and near centers of employment, shopping and entertainment.

"We are excited to have the opportunity to bring a new kind of luxury apartment living to the Lower Peninsula," said Tim Stanley, vice president of acquisition and development for AvalonBay Communities. "Avalon Towers on the Peninsula will offer phenomenal views from the coastal mountain range to the San Francisco Bay and exquisite interior finishes. Luxury apartments have been hard to find in this area, and we look forward to filling an important housing need in this community."

Among the amenities residents of Avalon Towers on the Peninsula will enjoy include a state-of-the-art fitness center, resort pool and spa, concierge services and an executive conference room. Standard features in each apartment home include high-speed Internet access, in-home networking capability, and condominium quality finishes such as granite countertops.

AvalonBay hopes to complete construction on Avalon Towers on the Peninsula in late 2001. More information about this upcoming community can be found at http://www.avalonpeninsula.com.

From San Francisco to San Jose, AvalonBay maintains a strong presence in the San Francisco Bay Area. Currently, AvalonBay manages approximately 34 luxury apartment communities in cities throughout the Bay Area, including the recently completed Avalon Towers in San Francisco, Avalon on the Alameda in San Jose, and Toscana in Sunnyvale. Avalon at WestPark, a multi-family apartment community that will feature a blend of lofts, traditional "flats" and townhomes, as well as 9,000 square feet of retail space, is scheduled to begin construction in downtown San Jose in September 2000.

AvalonBay Communities, Inc., headquartered in Alexandria, Va., currently owns or holds an ownership interest in 132 apartment communities containing 38,480 apartment homes in 12 states and the District of Columbia, of which nine communities are under construction and six communities are under reconstruction. The fourth largest apartment equity REIT in the country, AvalonBay is in the business of developing, redeveloping, and acquiring and managing multifamily apartment communities in high barrier-to-entry markets of the United States. More information on AvalonBay may be found on AvalonBay's Web site at http://www.avalonbay.com.