First Union Real Estate Equity and Mortgage Investments Announces Common Shareholder Suit Filed Against Proposed Merger.

Business Editors

NEW YORK--(BUSINESS WIRE)--Jan. 29, 2003

First Union Real Estate Equity and Mortgage Investments (NYSE:FUR) announced today that a lawsuit has been filed by a purported holder of First Union common shares, on behalf of himself and common shareholders as a class, in the New York Supreme Court for New York County.

The lawsuit seeks a declaration that the lawsuit is maintainable as a class action and a certification that the plaintiff, Robert Fink, is the representative of the class. Named as defendants in the lawsuit are First Union, Gotham Partners, L.P. ("Gotham"), companies affiliated with Gotham and First Union that are parties to the Agreement and Plan of Merger and Contribution, dated February 13, 2002, as amended (the "Merger Agreement"), William Ackman and the four current Trustees of First Union. Among the allegations asserted are breach of fiduciary duty and aiding and abetting thereof in connection with the transactions contemplated by the Merger Agreement, providing for the merger of First Union with and into Gotham Golf Corp. ("Gotham Golf").

The relief requested by the plaintiff includes an injunction preventing the defendants from proceeding with consummation of the merger, rescission of the merger if it occurs, an accounting for any profits realized by the defendants as a result of the actions complained of, an order permitting the creation of a shareholders' committee comprised of First Union common shareholders and their representatives to manage the affairs of First Union, compensatory damages and the costs and disbursements of plaintiff's counsel.

First Union regards the lawsuit as without merit and plans to vigorously defend against the allegations. First Union will oppose any attempt by the plaintiff to interfere with the transactions contemplated by the Merger Agreement, which was approved by more than 64% of the outstanding First Union common shares and by approximately 99% of the common shares voted at a special meeting of shareholders held on November 27, 2002.

INVESTORS AND SECURITY HOLDERS SHOULD READ THE DEFINITIVE MERGER AGREEMENT AND THE REGISTRATION STATEMENT ON FORM S-4, AS AMENDED, OF GOTHAM GOLF AND SOUTHWEST SHOPPING CENTERS CO. II, L.L.C. ("SSCC"), FILED ON OCTOBER 31, 2002, TO APPRISE THEMSELVES OF THE PROPOSED TRANSACTION. IN ADDITION, INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT/FINAL PROSPECTUS REGARDING THE PROPOSED TRANSACTION REFERENCED IN THE FOREGOING BECAUSE IT CONTAINS IMPORTANT INFORMATION. The definitive proxy statement/final prospectus has been filed with the Securities and Exchange Commission by First Union, Gotham Golf and SSCC and was mailed to First Union's shareholders on or about November 6, 2002. Investors and security holders may obtain a free copy of the definitive proxy statement/final prospectus and other documents filed by First Union, Gotham Golf and SSCC with the Securities and Exchange Commission at the Commission's website at www.sec.gov. The definitive proxy statement/final prospectus and these other documents may also be obtained for free from First Union.

The definitive proxy statement/final prospectus filed on October 31, 2002 may be found at the Commission's website under the listings for either Gotham Golf Corp. or Southwest Shopping Centers Co. II, L.L.C.

Certain statements contained in this news release that are forward-looking are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. The uncertainties and risks include, but are not limited to, changes in market activity, changes in local real estate conditions and markets, actions by competitors, interest rate movements and general economic conditions. Further information about these matters can be found in the information included in the Annual Report filed by First Union with the SEC on Form 10-K, as amended, for its fiscal year ended December 31, 2001.

First Union Real Estate Equity and Mortgage Investments is a NYSE-listed stapled-stock real estate investment trust (REIT) headquartered in New York, New York.