Bay Apartment Communities Begins Construction of 300 Apartment Home Community in San Jose; Announces Completion of Two Other Apartment Communities.

SAN JOSE, Calif.--(BUSINESS WIRE)--Oct. 19, 1995--Bay Apartment Communities (NYSE:BYA) said today it has initiated construction of a 300-apartment home community, Rosewalk at Waterford Park, in San Jose, California.

The company expects that development and construction of this new community will cost $30.4 million, or approximately $104 per rentable square foot.

Bay expects Rosewalk at Waterford Park, which is located at Vista Park and Copperfield Drives, will be available for occupancy in June, 1996 and that the community will reach stabilized occupancy in 1997. The company expects the community will generate a cash return on cost of approximately 10 percent in the first calendar year following stabilized occupancy.

The company also announced that its two newest communities, Carriage Square in San Jose, California, and Canyon Creek in Campbell, California, have been completed and were 98 percent occupied at Oct. 15, 1995. The company expects the Carriage Square community to earn a return on cost in 1996 of approximately 9.6 percent, while Canyon Creek is expected to earn a return on cost of roughly 9.9 percent despite being fully financed with tax-exempt bonds.

"Bay continues to be the most active developer of high quality apartment communities in our market," said Gilbert M. Meyer, chairman and chief executive officer of Bay. "Rosewalk at Waterford Park continues the Bay tradition of offering an upscale apartment living experience in a desirable location," he added. "The community will offer such resident amenities as a full gate system, enclosed carports with automatic door openers, a business center, a 75' lap pool and fully-equipped exercise facility.

"The new community is located near the intersection of two major highways and less than ten minutes south of downtown San Jose. In addition, it is adjacent to a new major neighborhood shopping center currently under construction and within walking distance of a Santa Clara County Light Rail Station," he noted.

The new community will have 96 one-bedroom/one bath apartment homes; 192 two-bedroom/two bath apartments and 12 three bedroom/three bath apartment homes. It is situated on approximately 10.8 acres of land.

Bay Apartment Communities is a fully integrated, multi-family real estate investment trust focused on the acquisition, development, construction, reconstruction and management of high quality apartment communities in Northern California. The company owns 22 apartment communities containing more than 5,700 apartment homes in the San Francisco Bay Area and Northern California.

CONTACT: Bay Apartment Communities

Gilbert M. Meyer, 408/983-1500