Blackstone Announces Strategic Alliance With Leading European Property Investor/Developer.

PARIS--(BUSINESS WIRE)--April 23, 1998--The Blackstone Group announced today that its affiliate, Blackstone Real Estate Acquisitions L.L.C., has launched a strategic initiative with a group of companies founded by leading European real property investor and developer Michael Billyard Leake. Blackstone and Billyard Leake's companies (generally known as the Malvern Group) are expected to work together on a variety of real estate transactions, in the office, retail, industrial, hotel and other sectors, throughout Eastern and Western Europe. Malvern will also be responsible for managing certain of Blackstone's European properties. This step is part of Blackstone's strategy to expand its presence in the European real estate market.

"With over $500 million in assets in Europe, we are actively evaluating various submarkets within major European cities for investment opportunities," noted Thomas J. Saylak, Senior Managing Director of Blackstone Real Estate Advisors. "We have a significant volume of opportunities brought to us every day, and we expect this volume to grow over time. However, to invest effectively, we believe it is important to obtain the best advice possible from local experts and Michael is one of the leading figures in European real estate today. We look forward to working with him to evaluate transactions that Malvern and other unrelated parties bring to our attention."

"This relationship with Blackstone provides us with the capital we need to take advantage of the opportunities available throughout Europe today," commented Billyard Leake. "Blackstone has an exceptional international reputation and has already made significant real estate investments in Paris and London. Our relationship developed over the past year through my involvement with the acquisition and subsequent asset management of the Descartes Tower in Paris. We look forward to working with Blackstone to increase its European portfolio."

Blackstone investments in Europe to date include office holdings (the Descartes Tower in the La Defense section of Paris and Arundel Great Court in London) and a portfolio purchased from the Imry Group that includes eight assets located in the United Kingdom. Descartes Tower, an 825,000-sq. ft. (76,775 sq. meters) office building, is the European headquarters for IBM. Arundel Great Court, a 315,000 sq. ft. (30,000 sq. meter) office building in central London houses Arthur Andersen's UK headquarters.

Earlier this month, Blackstone, together with Colony Capital Inc., and the Board of The Savoy Group, announced recommended cash offers in London through which Blackstone and Colony would acquire The Savoy Group, which includes several of London's most famous and prestigious hotels (The Savoy, Claridge's, The Berkeley, and The Connaught).

Billyard Leake has over 20 years of experience in the commercial and residential markets of France, Germany, the United Kingdom, and the United States. Prior to forming the Malvern group of companies, he was a partner in HRO France, which is one of the leading investors in the Paris real estate market. Billyard Leake has been responsible for the development and investment in prime commercial and residential property totaling more than 2.25 million-sq. ft. (209,000 sq. meter) as well as for land development in excess of 18 million sq. ft. (1.67 million sq. meter).

Billyard Leake is also managing director of Bredenbury Property Services, a real estate advisory service he found in 1985. The company's activities have ranged from the provision of specific advisory services to full hands-on management of projects and businesses on behalf of its investors. In 1985, Bredenbury launched Malvern Property Company plc, a U.K. real estate investment and development business. After the successful closing of the public offering, Michael Billyard Leake managed the business of Malvern Property Company plc and in 1990, following a bid from a publicly-traded property company, negotiated its sale for a price which returned to investors in excess of 40% Internal Rate of Return. Bredenbury has also been active in Germany where it is involved in the development of a 400-acre business park for a leading Swedish real estate investor. At inception, land sales totaled some US$ 65 million and the park included the development of a 285,000-sq. ft. office and regional handling facility for the Deutsche Bundespost.

Blackstone Real Estate Partners' funds and other affiliates of The Blackstone Group currently hold approximately $4.5 billion worth of real estate assets, including buildings representing over 10 million square feet of office space in the United States and Europe, as well as significant interests in leading hotels and hotel companies.

The Blackstone Group was founded in 1985 by its current Chairman, Peter G. Peterson, and its current President and CEO, Stephen A. Schwarzman. Real estate is one of five business areas at The Blackstone Group. The firm is also the sponsor of the largest private equity fund raised in 1997, Blackstone Capital Partners III, with approximately $4 billion of available equity capital for corporate investments. Blackstone is also a leader in cross-border Mergers & Acquisitions, Restructuring and Reorganization, and Liquid Alternative Asset Management.

CONTACT: Tom Saylak

Senior Managing Director

The Blackstone Group

212-836-9895