Fog Cutter Capital Group Inc. Reports Real Estate Sale by Bourne End Subsidiary.

Business Editors

Fog Cutter Capital Group Inc. (Nasdaq:FCCG), a diversified investment group specializing in mortgage and real estate related assets, reports that Bourne End Properties PLC ("Bourne End") has sold the 135,000 square foot Clarendon Shopping Centre, located in Hyde, England, and the 140,000 square foot Fleet Walk Shopping Centre, located in Torquay, England for a combined price of GBP 40.9 million ($58.5 million).

In December, 2000, Fog Cutter Capital Group organized and led a group of investors to purchase all of the outstanding capital stock of Bourne End, a specialist investor in retail property. The Company made its investment through its wholly owned subsidiary, BEP Islands Limited, along with partners Merrill Lynch (Jersey) Holdings Limited (a subsidiary of Merrill Lynch & Co., Inc.) and Greenbau Estuary Limited (an affiliate of Catalyst Capital LLP, formerly known as The Greenwich Group International). At the time of the acquisition, Bourne End had approximately GBP 169.6 million ($245.1 million) of assets and GBP 123.1 million ($177.9 million) of debt. The real estate assets consisted of 1.7 million square feet in fifteen shopping centers.

Including the sale of the Hyde and Torquay shopping centers, Bourne End has sold nine properties since the acquisition by Fog Cutter and its partners. These sales have been consistent with the group's strategy to reposition each of the centers, including new capital expenditures on existing space and new development on excess or adjoining land, with the goal of reselling many of the properties. Based on square footage, the sales to date represent 43% of the original Bourne End portfolio and are in line with the acquiring group's business plan. Bourne End currently owns six town shopping centers located in England and Scotland. The remaining centers range in size from 96,000 square feet to 330,000 square feet.

The Clarendon Shopping Centre serves the community of Hyde, England, a suburb of Manchester. The center provides 135,000 square feet of retail space on one level, including 51 shops, 26 small kiosk units and a supermarket, all in an enclosed environment. The Fleet Walk Shopping Centre is located in south-west England on the Devon coast in the tourist community of Torquay. It provides 140,000 square feet of retail space in 60 units on two levels.

Founded in 1997, Fog Cutter Capital Group Inc. focuses on investing, structuring and managing real estate-related assets, including the acquisition of companies engaged in real estate investment activities, mortgage-backed securities, mezzanine real estate loans and other real estate related assets. The Company invests where its expertise in intensive asset management, mortgage and real estate credit analysis and financial structuring can create value. Many of these investments, particularly in corporate acquisitions, are acquired in conjunction with partners.

The Company seeks to invest directly or indirectly in real estate-related assets that provide an appropriate risk-adjusted rate of return and the opportunity for capital gains. The Company maintains a flexible approach with respect to the nature of its investments, seeking to take advantage of opportunities as they arise or are developed.

Forward Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in such statements. All of the statements contained in this release, which are not identified as historical, should be considered forward-looking. In connection with certain forward-looking statements contained in this release and those that may be made in the future by or on behalf of the company which are identified as forward-looking, the company notes that there are various factors that could cause actual results to differ materially from those set forth in any such forward-looking statements. Such factors include but are not limited to, the real estate market, the availability of real estate assets at acceptable prices, the availability of financing, interest rates, and European markets. Accordingly, there can be no assurance that the forward-looking statements contained in this release will be realized or that actual results will not be significantly higher or lower. The forward-looking statements have not been audited by, examined by, or subjected to agreed-upon procedures by independent accountants, and no third party has independently verified or reviewed such statements. Readers of this release should consider these facts in evaluating the information contained herein. The inclusion of the forward-looking statements contained in this release should not be regarded as a representation by the company or any other person that the forward-looking statements contained in this release will be achieved. In light of the foregoing, readers of this release are cautioned not to place undue reliance on the forward-looking statements contained herein.