Behringer Harvard boosts holdings to $3.9b with IPC buy.

Behringer Harvard announced that it has entered into a definitive agreement to acquire publicly traded IPC US REIT and its portfolio of 35 Class A office properties located in the United States.

The agreement calls for Behringer Harvard REIT I, Inc. to purchase all of Toronto-based IPC US REIT's subsidiaries at a purchase price of $9.75 US per unit, or approximately $1.4 billion.

Of the total purchase price, approximately $600 million represents equity while the remaining approximate $800 million representsassumption of debt.

The transaction includes a breakup fee of up to $12 million to Behringer Harvard if under certain conditions the transaction should not close. The closing of the acquisition is expected to occur in late October or early November 2007 and is contingent upon customary closing conditions, including regulatory approvals and third party consents, and the approval of the IPC US REIT unitholders.

"These assets will make excellent additions to and further strengthen our current Behringer

Harvard REIT I portfolio," said Robert M. Behringer, chairman and chief executive officer of Behringer Harvard.

"Many of the IPC REIT's properties stand as signature buildings in their respective markets. In addition, several IPC REIT properties are in markets where Behringer Harvard REIT I already has an ownership presence. This will further add to the quality of our portfolio, which is a factor in the REIT's attractiveness to institutions and Wall Street from a valuation perspective."

"Our ability to capitalize on this important opportunity is an indication of Behringer Harvard REIT I's strong balance sheet and overall financial position," said Behringer.

IPC US REIT is the only REIT in Canada to focus exclusively on U.S. properties. Portfolio assets are located in 18 markets, primarily large to mid-sized cities in locations with notable barriers to entry.

Collectively, the portfolio represents 9.6 million square feet of net rentable space. While the acquisition is comprised primarily of Class A, institutional-quality commercial office properties, it also includes opportunities for value added development as well.

The IPC US REIT assets will significantly increase the holdings in Behringer Harvard REIT I's portfolio, which currently includes more than $2.5 billion in 37 institutional quality office buildings and other assets across the United States that represents more than 12.4 million square feet in rentable office space.

The addition of the IPC US REIT portfolio will bring Behringer Harvard REIT I's total holdings to more than $3.9 billion in 72 office buildings representing more than 25.5 million square feet of rentable office space. The IPC US REIT portfolio will increase Behringer Harvard REIT I's presence in some markets and provide entry to other markets, including New York, New Jersey.