Centerline Holding Company Reaches Preliminary Settlement of Claims in Derivative Litigation.

NEW YORK -- Centerline Holding Company (OTCBB:CLNH) ("Centerline" or the "Company"), the parent company of Centerline Capital Group, a provider of real estate financial and asset management services, today announced it has reached a preliminary settlement of claims in the derivative litigation that has been pending in the United States District Court for the Southern District of New York, Carfagno v. Schnitzer, 08 Civ. 912 (SAS) (S.D.N.Y.). Subject to judicial approval, the parties have agreed that the terms of the convertible preferred stock issued by Centerline to an affiliate of The Related Companies, LP ("TRCLP") in January 2008 would be revised so that the dividend rate payable on the convertible preferred shares issued will be reduced from 11 percent annually to 9.5 percent and the conversion price will be increased from $10.75 to $12.35. In exchange, the Carfagno plaintiffs will release all claims brought against Centerline's officers and directors and TRCLP. A proposed stipulation of settlement was filed with the Court on April 8, 2009 and a fairness hearing for approval of the settlement has been scheduled for May 18, 2009 at 5:00 p.m. in the courtroom of U.S. District Judge Shira Sheindlin at 500 Pearl Street, New York, NY 10007. The Carfagno settlement is also contingent upon the dismissal with prejudice of the overlapping Off and Ciszerk actions pending before the Delaware Court of Chancery. Individuals may review the settlement stipulation on the Centerline website investor relations page at http://media.corporate-ir.net/media_files/irol/74/74331/settlement.pdf, as well as a detailed notice to Centerline shareholders regarding the terms of the settlement at http://media.corporate-ir.net/media_files/irol/74/74331/notice.pdf.

About Centerline Capital Group

Centerline Capital Group, a subsidiary of Centerline Holding Company (OTC: CLNH), provides real estate financial and asset management services, including institutional debt and equity fund management, mortgage banking and primary and special loan servicing. As of December 31, 2008, Centerline had more than $14 billion of assets under management. Centerline is headquartered in New York, New York and has eight offices throughout the United States. For more information, please visit Centerline's website at http://www.centerline.com or contact Elizabeth Haukaas at 212.521.6453.

Certain statements in this document may constitute forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Other risks and uncertainties are detailed in Centerline Holding Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, and include, among others, business limitations caused by adverse changes in real estate and credit markets and general economic and business conditions; risks related to the form and structure of our financing arrangements; our ability to generate new income sources, raise capital for investment funds and maintain business relationships with providers and users of capital; changes in applicable laws and regulations; our tax treatment, the tax treatment of our subsidiaries and the tax treatment of our investments; competition with other companies; risk of loss from direct and indirect investments in commercial mortgage-backed securities ("CMBS") and collateralized debt obligations ("CDOs") and mortgage revenue bonds; risk of loss under mortgage banking loss sharing agreements; risks associated with providing credit intermediation; and risks associated with enforcement by our creditors of any rights or remedies which they may possess. Words such as "anticipates", "expects", "intends", "plans", "believes", "seeks", "estimates" and similar expressions are intended to identify forward-looking statements. Such forward-looking statements speak only as of the date of this document. Centerline Holding Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Centerline Holding Company's expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based.