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OLYMPIA & YORK RESTRUCTURES 55 WATER STREET

 OLYMPIA & YORK RESTRUCTURES 55 WATER STREET
 NEW YORK, Sept. 8 /PRNewswire/ -- Olympia & York Water Street


Finance Corp. and the Steering Committee of holders of its $548,250,280 of secured notes announced today that they had reached an agreement in principle regarding the financial restructuring of 55 Water Street, the largest privately-owned single office building in New York City.
 Under the proposed agreement, noteholders would exchange their secured notes for 100 percent equity in the building (approximately 20 million shares of common stock), invest an additional $21 million in preferred stock and exchange mutual releases with Olympia & York. Noteholders will be entitled to invest the additional $21 million for capital improvements in exchange for shares of preferred stock of the same corporation that would be convertible into approximately 12.35 percent of its common stock at $7.45 a share.
 The Retirement Systems of Alabama, holder of approximately $100 million of original secured notes, said it is prepared to purchase and exercise any unsubscribed rights with respect to the preferred stock as well as purchase 100 percent of common stock from any noteholder who does not wish to retain their interest in the property at the price of $7.45 per share.
 In addition, the parties have agreed to cooperate with each other to ensure that the transfer of the property, including the transitional aspects relating to the management and day-to-day operations of 55 Water Street, is effected in a smooth and orderly manner.
 Wilbur L. Ross, Jr., senior managing director of Rothschild Inc., financial advisor to the committee said, "This agreement demonstrates Olympia & York's practical and constructive approach to stabilizing major properties and protecting the interests of creditors and tenants. 55 Water will now be debt-free and will have sufficient cash available to continue to operate as a premium downtown building."
 According to Dr. David G. Bronner, chief executive officer of the Retirement Systems of Alabama, "We would be happy to own 100 percent of 55 Water and we would be equally happy to have the former noteholders remain as our equity partners. We believe that the New York real estate market provides excellent long term opportunities and are delighted to be substantial participants in the inevitable turnaround. Our institution has less than 1 percent of its portfolio in real estate and is therefore in a position to make major commitments to trophy properties in the present depressed environment."
 The Steering Committee had been organized on May 22, 1992 and consists of the holders of 30 percent of the secured notes. Anderson Kill Olick & Oshinsky, legal counsel for the Steering Committee; Jones Lang Wootton, the committee's real estate advisor; along with Rothschild Inc., the committee's financial advisor each assisted the Steering Committee in negotiating the proposed transaction. In addition, S.N. Phelps & Company acted as independent advisor to the Retirement Systems of Alabama.
 The Retirement Systems of Alabama pension fund has approximately $12 billion in assets and 225,000 members.
 The transaction is subject to certain conditions, including satisfactory documentation, and approvals by noteholders and other certain creditors. Completion of the transaction is anticipated to occur as early as March 1993.
 -0- 9/8/92
 /CONTACT: Dr. David G. Bronner, chief executive officer of the Retirement Systems of Alabama, 205-242-5718, or Wilbur L. Ross, Jr., senior managing director of Rothschild Inc., 212-757-6000/ CO: Olympia & York Water Street Finance Corp. ST: New York IN: FIN SU:


AH-LD -- NY068 -- 7209 09/08/92 17:25 EDT
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Publication:PR Newswire
Date:Sep 8, 1992
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