CalPERS to Purchase First Washington Realty Trust, Inc. for $800 Million; Transaction To Be Completed By Pension Fund's Retail Real Estate Advisor National Retail Partners, L.L.C.

Business Editors

SACRAMENTO, Calif.--(BUSINESS WIRE)--Sept. 28, 2000

The California Public Employees' Retirement System (CalPERS) and National Retail Partners, L.L.C. announced today the proposed acquisition of Bethesda, Maryland-based First Washington Realty Trust, Inc. for approximately $800 million.

The proposed acquisition, which has been approved by First Washington's Board of Directors, is subject to approval by First Washington's shareholders. Closing is expected in January 2001. The acquisition, one of the single largest retail transactions in the U.S., includes 63 properties totaling 6.6 million square feet of supermarket-anchored neighborhood shopping centers located in the states of Maryland, Virginia, Delaware, Pennsylvania, North Carolina, South Carolina, Illinois and Wisconsin. The portfolio's investments are concentrated in the key metropolitan areas of Washington, D.C., Baltimore, Northern Virginia, Philadelphia and Chicago.

"This portfolio is in the middle of the strike zone for CalPERS core real estate strategic plan," said Michael Flaherman, Chair of CalPERS Investment Committee. "It strengthens our exposure on the East coast and features high-quality grocery-anchored centers located in strong markets that will provide the opportunity to enhance cash flow and value to our Fund."

The properties are strategically located in densely populated areas with high visibility and open air designs, and are adaptable over time to expansion, renovation and redevelopment. They are anchored by well-known tenants such as Safeway, Food Lion, Giant Food, ACME, A&P Superfresh and Dominick's.

First Washington Realty Trust, Inc. is being purchased by U.S. Retail Partners L.L.C., a joint venture between CalPERS and National Retail Partners, L.L.C., the pension fund's retail real estate advisor for its shopping center portfolio.

National Retail Partners, L.L.C. is a partnership recently formed by six senior real estate professionals from CalPERS former non-mall retail property advisor BPP Retail, L.L.C. The team has an extensive base of experience, relationships and knowledge in the acquisition, development and management of retail property portfolios.

"This is a well-qualified and motivated team of professionals who will help us enhance and grow our retail portfolio," said Daniel Szente, CalPERS Chief Investment Officer. "They have extensive retail industry experience with many of the leading retailers and shopping center investors in the United States. I'm confident that we have a team that will work hard for CalPERS and its members."

CalPERS owns more than $6.3 billion in core real estate assets, consisting of apartment, industrial, office and retail properties in the United States. Currently, the pension fund's retail portfolio is valued at approximately $1.5 billion.

CalPERS is the nation's largest public pension fund with assets totaling $177 billion. The System provides retirement and health benefits to more than 1.2 million state and local public employees and their families. For further information about CalPERS, please visit the System's web site at www.calpers.ca.gov.