Bold New Vision for Peninsula Gateway Plaza Will Create Premier Office Location and Destination for Daly City; Redevelopment Agency Board Approves $200 Million Plan.

DALY CITY, Calif.--(BUSINESS WIRE)--Sept. 15, 1998--The Daly City Redevelopment Agency Board last night selected an imaginative plan by Summit Commercial Properties and Mack-Cali Realty Corp. (NYSE:CLI) for the 10-acre Peninsula Gateway Plaza site, the cornerstone project of the city's major revitalization initiative in its downtown core.

The plan calls for an integrated complex of approximately 600,000 square feet of Class A office space, a full-service hotel of approximately 350 rooms, a 20-screen multiplex and 40,000 square feet of retail and restaurants.

The developers will invest approximately $200 million in this joint venture. Construction on the first phase is expected to start next summer.

"The Summit/Mack-Cali plan captured our vision for Peninsula Gateway Plaza as the town square for our city, creating a vibrant gathering place for residents and visitors as well as office tenants," said Mayor Michael P. Guingona. "Moreover, this new project will be an economic engine for Daly City, attracting substantial numbers of new jobs and revenues."

"Our goal is to develop a landmark for Daly City and the Bay Area," said Jack Mahoney, president of Summit Commercial. "This is a terrific site with great visibility along one of the major north-south freeways connecting San Francisco and the Silicon Valley. It also has excellent public transportation access through the adjoining BART station."

Designed by San Francisco-based architects Kaplan, McLaughlin, Diaz, the heart of the new Peninsula Gateway Plaza will be a one-acre central plaza that is envisioned as the town square for Daly City.

A major fountain and waterway will highlight the plaza that will connect to the adjacent Marchbank Park by a wide, graceful staircase, reminiscent of Rome's Spanish Steps. The multiplex, retail and restaurant spaces will spill out into the plaza that also will be enlivened by a half-mile long promenade bordered with trees along the front of Marchbank Park.

The project design echoes the sweeping curve of the adjacent BART line. Its six low- and mid-rise buildings are designed to weave into the existing neighborhood and respect the surrounding community. Even the parking structures are disguised with pleasing facades and colors.

The project is anchored at the north end by a 12-story hotel that will be turned "inside out" with restaurants, shops and activity centers placed on the outside facing the BART station. An eight-story, 320,000-square-foot office building at the south end sits on a site across Westlake Avenue that is planned to be linked to the project by a bridge.

The 20-screen multiplex will be state-of-the-art with 4,500 stadium seats. It will be surrounded by 40,000 square feet of restaurants and shops oriented to the plaza and fronting on Junipero Serra Boulevard. A wide range of food establishments from full service to fast food and deli are planned along with convenience shops to support the hotel and office as well as recognized retailers.

The hotel will be a full service corporate hotel with a conference center of 20,000 to 30,000 square feet. Construction on the cinema, retail and hotel is slated for summer 2000 with completion in fall 2001.

"We are pleased that two companies of the calibre of Summit and Mack-Cali will develop and own Peninsula Gateway Plaza," said Guingona.

Earlier this year Mack-Cali Realty, a New Jersey-based real estate investment trust (REIT), announced a partnership with Summit Commercial to pursue commercial development opportunities in California. Mack-Cali is one of the leading real estate investment trusts in the country with a total market capitalization of over $3.9 billion. The $200 million Peninsula Gateway Plaza will be the flagship of a $500 million multiproject venture with Summit.

Current Mack-Cali/Summit Commercial joint ventures in California include Lava Ridge Business Center, 183,200 square feet in Roseville; Continental Grand Plaza II, 237,000 square feet in El Segundo; and Summit Ridge Business Park, 132,300 square feet in San Diego. Being formalized are Anaheim Sportstown, 500,000 square feet in Anaheim; Mission Valley Corporate Center, 148,000 square feet in San Diego; and Valencia Business Park, 200,000 square feet in Valencia.

Summit Commercial is an affiliate of Highridge Partners, one of the nation's most successful and respected real estate companies. Headquartered in Los Angeles with Northern California offices in Sacramento, the company has acquired, developed and managed a real estate portfolio valued at more than $2.5 billion in the past decade.

Recently Summit Commercial has been focused on California, acquiring 50 properties in the last three years. Just last month the company concluded the purchase of Southport Business Park, a 627-acre master-planned industrial park in West Sacramento. To be built in four phases, the project will bring a combined total of 10.5 million square feet of office and industrial space to the state capital.

Mack-Cali Realty (http://www.mack-cali.com) is a fully integrated, self-administered, self-managed real estate investment trust (REIT) providing leasing, management, acquisition, development, construction and tenant-related services for its portfolio. With the completion of pending transactions, Mack-Cali's portfolio will consist of 27.5 million square feet, serving over 2,300 tenants.

The company's portfolio is located in 12 states and the District of Columbia, primarily in the Northeast, as well as the Southwest and West.

Colliers International Senior Vice President David Terzola and Colliers International Hotel Realty Senior Vice President Bob Eaton represented Daly City in the proposal process leading to the selection of Summit Commercial and Mack-Cali Realty. "Colliers performed beyond our expectation and was invaluable in our efforts to secure a top developer for this project," stated City Manager John C. Martin.

Charles Pankow Builders LTD will be the general contractor for the project.

CONTACT: Daly City

Terry Sedik, 650/991-8157

or

Casey & Sayre

Karen Diehl, 310/458-1224