MELVILLE, N.Y.--(BUSINESS WIRE)--Dec. 7, 2005--Reckson Associates Realty Corp. (NYSE: RA) announced today that the Company has contracted to acquire a 1.6 million square foot office portfolio, consisting of 14 buildings, concentrated within five business parks, located on the Platinum Mile in Westchester County, for approximately $255 million or $163 per square foot.

The office portfolio, known as the Eastridge portfolio, is exceptionally well located on Interstate-287, at the intersection of Interstate-684 and the Hutchinson River Parkway. The properties are located in the heart of the Westchester County office market that historically has been the choice location for the county's most prestigious companies. The location offers excellent access to the White Plains Central Business District, the rail and bus transportation center, as well as easy access to the most sought after residential communities in Westchester.

This transaction continues a robust period of investment activity by Reckson. With this acquisition, the Company has completed investments totaling approximately $1.3 billion during 2005, successfully acquiring office properties in several of Reckson's targeted submarkets located in New York City, Westchester, Connecticut, Northern New Jersey and Long Island.

Commenting on the transaction, Scott Rechler, Reckson's President and Chief Executive Officer, said, "This investment represents a quintessential value creation opportunity for Reckson. The extremely well located, institutionally owned portfolio provides us with the opportunity to reposition and redevelop the underperforming properties into Class A properties at significant discounts to replacement cost and attractive stabilized NOI yields."

Reckson is purchasing the portfolio at an attractive price of approximately $163 per square foot, representing a discount to replacement cost in excess of 35%. The portfolio is approximately 70% occupied, compared to an approximate 91% occupancy rate for Reckson's current Westchester office portfolio. This acquisition reflects Reckson's focus on acquiring properties that offer the opportunity to apply the Company's expertise to create value. Reckson is uniquely equipped to increase the portfolio's value by effectively addressing its vacancies, increasing rents, leveraging the Company's scale to generate significant operating expense efficiencies and to capitalize on the value-added nature of the transaction based on its mix of properties in need of redevelopment and repositioning. Reckson anticipates that these operating initiatives will increase the portfolio's initial GAAP net operating income (NOI) yield of approximately 5% to approximately 9% upon stabilization.

Michael Maturo, Reckson's Executive Vice President and Chief Financial Officer, noted, "I am pleased that our disciplined investment approach has enabled us to acquire this portfolio at an attractive valuation. I believe it is an indication that the market is starting to rationalize pricing for value-added investments of this nature." Mr. Maturo continued, "We will continue to seek capital recycling opportunities within our portfolio and anticipate that we may sell all or a portion of these core plus properties to our recently formed Australian LPT or to certain other strategic purchasers at fair market value."

Reckson currently owns and operates approximately 3.2 million square feet in Westchester County. With the acquisition of this office portfolio, Reckson will increase the Company's Westchester portfolio to approximately 4.8 million square feet. This acquisition enhances the Company's critical mass in Westchester and complements the current portfolio locations with product on the Interstate-287 corridor in the very attractive eastern submarket. This acquisition will further enhance Reckson's Class A office franchise throughout the New York Tri-State area and further solidify Reckson's position as the leading provider of the highest quality office space and "Landlord of Choice" in the New York Tri-State area.

The properties are distinguished by architectural glass exteriors, well maintained landscaping and lobbies with high-end finishes. The properties and office parks offer many outstanding amenities which include full service cafeterias, cafe/coffee bars, generous parking allocations, retail banking, bus service, daycare centers, sundry shops and conference facilities.

Reckson anticipates closing on this acquisition in the fourth quarter of 2005.

Reckson Associates Realty Corp. is a self-administered and self-managed real estate investment trust (REIT) specializing in the acquisition, leasing, financing, management and development of Class A office properties.

Reckson's core growth strategy is focused on the markets surrounding and including New York City. The Company is one of the largest publicly traded owners, managers and developers of Class A office properties in the New York Tri-State area, and wholly owns, has substantial interests in, or has under contract, a total of 103 properties comprised of approximately 20.1 million square feet. For additional information on Reckson Associates Realty Corp., please visit the Company's web site at www.reckson.com.

Certain matters discussed herein, including guidance concerning the Company's future performance, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, forward-looking statements are not guarantees of results and no assurance can be given that the expected results will be delivered. Such forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those expected. Among those risks, trends and uncertainties are the general economic climate, including the conditions affecting industries in which our principal tenants compete; financial condition of our tenants; changes in the supply of and demand for office properties in the New York Tri-State area; changes in interest rate levels; changes in the Company's credit ratings; changes in the Company's cost of and access to capital; downturns in rental rate levels in our markets and our ability to lease or re-lease space in a timely manner at current or anticipated rental rate levels; the availability of financing to us or our tenants; changes in operating costs, including utility, real estate taxes, security and insurance costs; repayment of debt owed to the Company by third parties; risks associated with joint ventures; liability for uninsured losses or environmental matters; and other risks associated with the development and acquisition of properties, including risks that development may not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated. For further information on factors that could impact Reckson, reference is made to Reckson's filings with the Securities and Exchange Commission. Reckson undertakes no responsibility to update or supplement information contained in this press release.

CONTACT: Reckson Associates Realty Corp.
Scott Rechler, CEO
Michael Maturo, CFO
Salvatore Campofranco, COO
Phone: 631-694-6900
Fax: 631-622-6790
or
Rubenstein Communications
Media:
Rick Matthews, 212-843-8267

SOURCE: Reckson Associates Realty Corp.