Chelsea to Acquire Four Outlet Centers From New Plan for $193 Million.

Business Editors

ROSELAND, N.J.--(BUSINESS WIRE)--Nov. 12, 2002

Chelsea Property Group, Inc. (NYSE: CPG) announced today that it signed a definitive agreement to acquire four outlet centers from New Plan Excel Realty Trust, Inc. (NYSE: NXL) for an all-cash aggregate price of $193 million.

The purchase price reflects a capitalization rate of approximately 11% on estimated 2003 net operating income. The transaction is expected to close on or about December 31, 2002.

The four properties - totaling 1.3 million square feet of gross leasable area (GLA) - are Jackson Outlet Village, in Jackson, New Jersey; Factory Outlet Village Osage Beach, in Osage Beach, Missouri; St. Augustine Outlet Center, in St. Augustine, Florida; and Factory Merchants Branson, in Branson, Missouri. They generated average tenant sales of approximately $300 per square foot for the twelve months ended September 30, 2002, with an average tenant occupancy cost-to-sales ratio of approximately 7.3% for the same period.

Jackson Outlet Village opened in 1997 with a first phase of 200,000 square feet of GLA and was expanded in 1998 to its current size of 293,000 square feet and approximately 70 stores. It is located within a mile of the Six Flags Great Adventure theme park on Interstate 195, midway between Trenton and the Jersey Shore. As of September 30, 2002, the center was 100% leased, with tenants including Nike, Tommy Hilfiger, GAP, Banana Republic and WestPoint Stevens. Since its opening, the center has consistently been ranked among the outlet industry's top-performing properties.

Factory Outlet Village Osage Beach opened in 1987 with a first phase of 100,000 square feet of GLA and subsequently underwent multiple expansions to reach its current size of 400,000 square feet and 110 stores. The center is configured in a village layout and is located off Interstate 70, on highway 54 at the Lake of the Ozarks. As of September 30, 2002 it was 96% leased, with tenants including Polo Ralph Lauren, Coach, Nautica, Bose, Tommy Hilfiger and Brooks Brothers.

St. Augustine Outlet Center opened in 1990 with a first phase of 153,000 square feet of GLA and subsequently was expanded three times to its current size of 329,000 square feet and 95 stores. It is located off Interstate 95 at exit 95 between Daytona and Jacksonville, and was 93% leased as of September 30, 2002, with tenants including Coach, Liz Claiborne, WestPoint Stevens, Bose and Brooks Brothers.

Factory Merchants Branson opened in 1988 with a first phase of 200,000 square feet of GLA and was expanded in 1994 to 317,000 square feet and 90 stores. It is located off Route 26 in the heart of Branson, approximately 35 miles south of Springfield, Missouri, and was 85% leased as of September 30, 2002, with tenants including Coach, Nautica, Van Heusen, Dress Barn and Lenox.

David Bloom, Chairman and Chief Executive Officer of Chelsea, said, "Collectively, the New Plan outlet centers represent one of the strongest sizeable portfolios in our industry. We are delighted to have the opportunity to add them to Chelsea's increasingly dominant share of the better outlet properties, and intend to convert the Jackson, Osage Beach and St. Augustine centers to our Premium Outlet concept within 12-24 months. Additionally, we will now have the opportunity to rationalize and stabilize the Branson market by combining the leasing and management of Factory Merchants Branson with our existing center there.

"This transaction marks another significant step in the consolidation of the outlet industry, and we are very pleased to be continuing to play a leading role in that trend," Mr. Bloom added.

The acquisition will be discussed in further detail during Chelsea's third-quarter conference call with investors and analysts, to be held on Wednesday, November 13, 2002 at 2:00 p.m. eastern time. The call may be accessed by dialing 800-633-8410 (U.S. callers) or 212-748-2727 (international callers) and referencing reservation No. 20996232. A replay of the call will be available through November 20, 2002 by dialing 800-633-8284 (U.S. callers) or 402-977-9140 (international callers) with the same reservation number.

Chelsea Property Group, Inc. is a fully integrated, self-administered and self-managed real estate investment trust (REIT) that wholly or partially owns 54 Premium Outlet(R) and other retail shopping centers - containing 12.5 million square feet of GLA - in 28 states and Japan. The company's leading properties include Woodbury Common Premium Outlets, near New York City; Wrentham Village Premium Outlets, near Boston; Orlando Premium Outlets, in Orlando, Florida; Desert Hills Premium Outlets, near Palm Springs, California; and Gotemba Premium Outlets, near Tokyo, Japan. Please see www.cpgi.com for more information.

Statements in this news release that are not strictly historical are "forward-looking" statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although Chelsea Property Group believes the expectations reflected in such statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Forward-looking statements involve known and unknown risks that may cause actual results to differ materially from expected results. Risk factors include, without limitation: credit risk; the Company's ability to lease its properties; retail, real estate and economic conditions; competition; transaction closing risks; and other risks detailed from time to time in Chelsea Property Group's reports to the Securities and Exchange Commission. The Company accepts no responsibility for updating forward-looking statements.