Crescent Finalizes Sale of Woodlands Interest and Partial Acquisition of Hughes Center Office Portfolio.

Business Editors

FORT WORTH, Texas--(BUSINESS WIRE)--Jan. 6, 2004

Crescent Real Estate Equities Company (NYSE:CEI) today announced that the following transactions have been completed on terms consistent with those presented in the Company's press release dated November 12, 2003.

    --  On December 31, 2003, The Rouse Company (NYSE: RSE) acquired
        Crescent's previously held 52.5% economic interest (including
        earned promote) in The Woodlands master-planned community in
        Houston for a gross purchase price of $387 million, $202
        million in cash and $185 million in debt. The debt represents
        52.5% of the total partnership debt. Prior to closing, $18
        million of the $202 million cash component was received by
        Crescent in the form of partnership distributions net of
        working capital adjustments. As a result of the sale
        transaction, Crescent will record a gross gain of
        approximately $87 million, prior to closing expenses and
        income taxes.

    --  On December 31, 2003, Crescent acquired from Rouse two office
        properties and two leased restaurant parcels within the Hughes
        Center portfolio in Las Vegas for a gross purchase price of
        $39 million, $29 million in cash and $10 million in assumed
        debt.

        By the end of the first quarter of 2004, Crescent is scheduled
        to acquire from Rouse the remaining six office properties (two
        of which are held in joint-venture arrangements with other
        partners) and seven leased restaurant parcels within the
        Hughes Center portfolio for a gross purchase price of $184
        million, $97 million in cash and $87 million in assumed debt.
        The transactions are subject only to customary closing
        consents.

        As a result of these transactions, the Hughes Center office
        portfolio, including leased restaurant parcels, is anticipated
        to be acquired by Crescent from Rouse for a gross purchase
        price of $223 million, $126 million in cash and $97 million in
        assumed debt.

        In accordance with the original agreement, Crescent has also
        agreed to acquire, in March 2004, the undeveloped land within
        Hughes Center from Rouse for $10 million, $2.5 million of
        which is to be paid in cash with the remaining $7.5 million to
        be paid by Crescent in the form of a note due December 2005.

More information related to Crescent's sale of The Woodlands will be included in the Company's Form 8-K to be filed with the SEC by January 15, 2004.

The Woodlands is a 27,000 acre master-planned community located north of Houston which consists of undeveloped residential lots, commercial acres and office properties. As a result of Rouse's acquisition of Crescent's interest in The Woodlands on December 31, 2003, Rouse and Morgan Stanley Real Estate Fund II, L.P. own a 52.5% and 47.5% economic interest, respectively. Rouse and Morgan Stanley equally share control of The Woodlands Operating Company, L.P., which will continue to manage the development of The Woodlands.

Hughes Center, located in the Central East submarket, is the premier office address in Las Vegas. Constructed between 1986 and 1999, the Hughes Center complex contains eight Class A office properties totaling 1.1 million square feet and is currently 94% leased. Also included within the complex are leased restaurant parcels and undeveloped land which is suitable for up to 400,000 square feet of future office space. Hughes Center is home to a diverse, high quality customer base.

CRESCENT 2003 EARNINGS OUTLOOK

As a result of Crescent's sale of The Woodlands on December 31, 2003, Crescent's management anticipates its 2003 FFO will be at the upper end of its previously issued guidance for its 2003 estimated FFO range of $1.55 to $1.80 per share.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements relating to transactions and pending transactions between Crescent Real Estate Equities Company and The Rouse Company, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The matters discussed in these forward-looking statements are subject to various consents, conditions, agreements and contingencies, and may or may not occur as described, which may cause actual results to differ materially.

ABOUT THE COMPANY

Crescent Real Estate Equities Company is one of the largest publicly held real estate investment trusts in the nation. Through its subsidiaries and partners, Crescent owns and manages a portfolio of over 75 premier office buildings totaling over 30 million square feet primarily located in the Southwestern United States, with major concentrations in Dallas, Houston, Austin and Denver. In addition, the company has investments in world-class resorts and spas and upscale residential developments.