First Union Receives $29.6 Million Second Mortgage Financing.

CLEVELAND--(BUSINESS WIRE)--Oct. 29, 1999--

First Union Real Estate Investments (NYSE:FUR) announced that it obtained a $29.6 million second mortgage on Crossroads Center, its 783,000 square-foot shopping mall in St. Cloud, Minnesota. The financing was obtained from General Growth Properties, Inc. ("General Growth") at an interest rate of 15% and matures in June 2004, which date may be extended by First Union until June 2009. First Union also provided General Growth with an option to purchase the property on or about May 31, 2002 for $2.5 million over the balance of the outstanding mortgage debt.

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 the Company with the SEC on Form 10K/A.

First Union Real Estate Equity and Mortgage Investments is a NYSE-listed stapled-stock REIT headquartered in Cleveland, Ohio.