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NATION'S WORST RATED REAL ESTATE TRUST CUTS OFF DEBATE, REFUSES REQUEST BY MAJOR SHAREHOLDER FOR BALLOT RE-COUNT, SAYS SHAREHOLDER

NATION'S WORST RATED REAL ESTATE TRUST CUTS OFF DEBATE, REFUSES REQUEST BY MAJOR SHAREHOLDER FOR BALLOT RE-COUNT, SAYS SHAREHOLDER
 SAN FRANCISCO, Nov. 25 /PRNewswire/ -- The following is being issued by Lewis & Associates for Arthur Dann:
 Trustees of Sierra Real Estate Equity Trust '84, the nation's worst-rated real estate investment trust, cut off debate and refused a request for an independent verification of proxy ballots late Monday (Nov. 25) during a rancorous annual shareholders' meeting in San Francisco.
 Despite a continuing stream of questions from shareholders, most of whom individually own less than 500 shares of the once highly touted stock, trustees limited debate and discussion to about 40 minutes.
 They also refused a request by the trust's major shareholder, Arthur Dann, who owns 85,100 shares, for an independent verification of all proxy ballots returned to the firm. Instead, they said two officers of the trust would certify the ballots.
 "The normal course of action when there is a contested election of directors, as here, is to have the proxy ballots independently counted and verified," said attorney Phyllis E. Andelin, a partner in San Francisco-based Proskauer Rose Goetz & Mendelson, which represents Dann in his pending federal lawsuit against the trust.
 Dann, who is claiming securities fraud, mismanagement, fraud and negligence by the directors of this nearly bankrupt trust, alleges that he and other shareholders have lost nearly all of their investment in this REIT because its managers paid themselves lavish fees despite mounting losses.
 Dann, who filed suit on behalf of all of the trust's shareholders in October, has sought to have a federal receiver appointed to reverse the losses and salvage something for the shareholders. He says the directors are dumping the properties at "fire sale" prices -- such as attempting to sell the trust's major asset, Peninsula Shopping Center in Palos Verdes, Calif., at some $11 million less than its book value.
 In was evident at the meeting that most shareholders were unsophisticated small investors who invested in the trust through individual retirement accounts (IRAs).
 Two of those smaller investors, Ruth Hale of Ventura and Ann Poirier of Berkeley, attended Monday's meeting. Both supported Dann in his attempt to wrest control away from the slate of directors nominated by management. These were the same five trustees who have managed the trust throughout its years of losses.
 "I do not understand much about finance, but I think this trust is in trouble," said the retired Hale. "My husband and I are at a point in life where we shouldn't have to be worrying about this."
 Many investors were lured by the trust's marketing materials, which targeted IRA holders and other small pension fund plans. Shares of the stock could be purchased through any stock broker, and that's what many of the investors did -- rely on the advice of their stock broker.
 The Trust '84 stock, which initially sold to the public in 1984 and 1985 at $10 per share, is now trading at about 50 cents or less. In his lawsuit, Dann alleges that the defendants committed the following acts:
 -- Managed the trust for their own financial interest and not for the benefit of the shareholders.
 -- Engaged in self-dealing through unfair transactions with the trust, including payment to themselves of excessive "fees." (Since 1984, the Sierra Capital Companies has been paid $14,589,902 by the trust).
 -- Refinanced trust properties and depleted the equity in the properties in order to pay themselves management fees. The properties also are now heavily burdened with debt, preventing any distributions to shareholders.
 -- Retained proceeds of property sales instead of distribution to the shareholders; and that the defendants have not properly or competently managed the properties owned by the trust.
 Among the "excessive fees" alleged by Dann are advisory fees, property management fees, leasing commissions, construction supervision fees, transfer agent fees, financing fees, acquisition fees and other compensation and charges.
 After Dann filed his lawsuit, the defendants took several significant actions to protect themselves. Among the most suspicious actions was the payment to Sierra Capital Companies of $7,246,548 for the "privilege" of changing the REIT's management. Shareholders were not informed of the buyout until September 1991. Trust '84's share of the buyout was $145,656, which was borrowed.
 Dann was nominated to the board as the largest individual shareholder. The company declined to reveal the outcome of the vote until Wednesday, Nov. 27, 1991.
 -0- 11/25/91
 /CONTACT: Keith Karpe or Dick Lewis of Lewis & Associates, 213-739-1000, for Arthur Dann/ CO: Sierra Real Estate Equity Trust ST: California IN: SU:


EH-CH -- LA044 -- 7113 11/25/91 21:31 EST
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Date:Nov 25, 1991
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