PRESS RELEASES

Hines' European Value Added Fund Acquires Second Property

3/28/2006

(PARIS, FRANCE) – The Paris office of Hines, the international real estate firm, announced today that it has acquired 66-70 Avenue Charles de Gaulle in Neuilly-sur-Seine, Paris, from CGW, a joint venture set up between Caisse des Dépôts, GE Capital and Whitehall for the purchase and redevelopment of a France Telecom real estate portfolio. The six-story, 54,876-square-foot (5,100-square-meter) office building is located on Avenue Charles de Gaulle, the major axis running from the Arc de Triomphe in Paris to the La Défense business district, west of the city. This project represents the second asset purchased by the Hines European Value Added Fund (HEVAF). In August 2005, the HEVAF purchased Salustiano 11, a six-story apartment building in Salamanca, an affluent residential area in Madrid.

“This acquisition provides the Fund with an outstanding asset which we will renovate to an extremely high standard. We believe it will greatly appeal to the market, and we hope to out-perform our estimates,” said Olivier de Dampierre, president, Hines France.

Hines has hired architects Carlo Maria Natale and Arnaud Doiteau to completely renovate the existing building and design an extension. The project will include 9,684 square feet (900 square meters) of retail space on the ground floor, and 45,192 square feet (4,200 square meters) of office space on five levels, as well as 50 underground parking spaces. The work will begin in May 2006 and completion of the project is expected in July 2007. The French Post Office has already signed a lease, and there are advanced discussions to lease the remaining retail space. Hines France is expected to move its office into the upper floors of the building.

“We are pleased to announce the second acquisition for HEVAF, and expect more to follow soon,” said Lars Huber, a director with Hines in London who is also the fund manager. “With this vehicle, we plan on acquiring investments with potential, and applying Hines’ expertise to add value.”

HEVAF is capitalized with $370 million (€287 million) of equity commitments provided by German and Swiss institutions. HEVAF will invest primarily in office projects, but there is an allocation for other product types. Hines will focus on acquiring buildings in Western European countries, targeting France, Germany, Italy, Spain and the UK, and will seek to add value to acquisitions through tactics such as renovation, strategic leasing or re-leasing, improving operational efficiencies and refinancing.

“The Hines European Value Added Fund is the continuation of our strategy to widen our European activities,” said Executive Vice President Michael Topham. “In 2002, the firm formed the Hines European Development Fund and we are in the process of forming our European Core Fund.”

After more than three successful decades in the United States, Hines entered the European market in Berlin in 1991. Since then, the firm has developed projects in: Barcelona, Berlin, Düsseldorf, London, Madrid, Marbella, Moscow, Munich, Milan, Paris and Warsaw. The firm’s European portfolio consists of 40 projects totaling more than 12.1 million square feet (1.1 million square meters).

Hines opened its office in France in 1995, under the leadership of President Olivier de Dampierre and Managing Director Patrick Albrand. To date, Hines France has developed more than 1.6 million square feet (150,000 square meters) of office space and has approximately 3.7 million square feet (350,000 square meters) of space currently being developed in the western region of Paris.
Hines is a privately owned real estate firm involved in real estate investment, development and property management worldwide. The Hines portfolio of projects completed, underway, acquired and managed for third parties includes more than 830 properties representing over 330 million square feet (30 million square meters) of office, mixed-use, industrial, hotel, medical, sports facilities and residential properties, as well as large, master-planned communities and land developments. With offices in 15 countries, and controlled assets valued at approximately $12.5 billion (€10.3 billion), Hines is one of the largest real estate organizations in the world. Access www.hines.com for more information.

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