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MPMT ANNOUNCES WRITE-DOWNS OF HAWTHORNE AND HALL STREET INVESTMENTS AND SECOND QUARTER EARNINGS

MPMT ANNOUNCES WRITE-DOWNS OF HAWTHORNE AND HALL STREET INVESTMENTS
 AND SECOND QUARTER EARNINGS
 /EDITORS: Mellon/McMahan Real Estate Advisors, Inc., a wholly-owned subsidiary of Mellon Bank, N.A., acts as the investment advisor to Mellon Participating Mortgage Trust. The trust's assets are not assets of Mellon Bank Corporation (NYSE: MEL) and the trust's financial results are not included in the financial results of Mellon Bank Corporation./
 SAN FRANCISCO, Aug. 11 /PRNewswire/ -- Mellon Participating Mortgage Trust, Commercial Properties Series 85/10 (NASDAQ: MPMTS), today announced that it reduced the carrying value of a research and development facility located in Hawthorne, Calif., and the first mortgage loan of the Hall Street Industrial Complex, Brooklyn, N.Y., by approximately $4.5 million (31 percent) and $700,000 (9 percent), respectively.
 The effect of these write-downs on the trust's second quarter earnings is a "non-cash" charge of $5.2 million or 60 cents per share. Because of the "non-cash" nature of these write-downs, cash flow from operations and the trust's existing cash reserves of approximately $4.5 million at June 30, 1992, are unaffected.
 For the six months ended June 30, 1992, the trust's income before investment gains and losses was $2.7 million or 32 cents per share. Operating results for the same period after investment gains and losses will result in a net loss of $2.3 million or 27 cents per share.
 The Hawthorne, Calif., property value has decreased due to the rapid decline in rental rates for research and development (R&D) space in the Los Angeles area. This situation is attributable to uncertainties related to federal defense spending which have resulted in the Los Angeles area experiencing a significant increase in vacant R&D space in recent months.
 The Hawthorne property is a 210,000-square-foot R&D building leased to the Northrop Corporation through January 1994. Northrop is current on all rental obligations.
 The trust's initial investment consisted of a $14.3 million first mortgage loan secured by the property. As previously announced on June 30, 1992, the trust received title to the Hawthorne property through a foreclosure sale. The new carrying value for Hawthorne is $9.9 million.
 The Hall Street investment consists of a first mortgage loan secured by a 575,000-square-foot industrial property. The Hall Street property is located in Brooklyn, N.Y., where rental rates remain depressed and leasing activity is slow. The borrower has been in default and the trust has sought title to the property through foreclosure since 1989. Due to decreased leasing activity, an additional $700,000 will be added to the existing reserve, reducing the carrying value to $7.1 million.
 Hall Street will remain under the management of a court-appointed receiver until the trust's foreclosure action is complete. Upon foreclosure, the trust intends to implement an aggressive leasing program. Current occupancy is 60 percent.
 Both the Hawthorne, Calif., and Hall Street investments were classified as Real Estate Assets, In-Substance Foreclosure at Dec. 31, 1991.
 Mellon Participating Mortgage Trust, Commercial Properties Series 85/10, is a finite-life real estate investment trust, fully invested in participating and shared appreciation mortgages; a joint venture; and three real estate assets secured by office, retail and research development facilities throughout the United States.
 /delval/
 -0- 8/11/92
 /CONTACT: Brian Zywiciel of Mellon/McMahan Real Estate Advisors, Inc., 415-433-7770/
 (MEL MPMTS) CO: Mellon/McMahan Real Estate Advisors, Inc.; Mellon Bank, N.A.;
 Mellon Participating Mortgage Trust, Commercial Properties
 Series 85/10; Mellon Bank Corporation ST: Pennsylvania IN: FIN SU: ERN


DM -- PG009 -- 9094 08/11/92 16:06 EDT
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Date:Aug 11, 1992
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