FOR IMMEDIATE RELEASE

SOMERSET PARTNERS PROVIDES $65 MILLION
MEZZANINE LOAN SECURED BY ALLIANCE MULTI-FAMILY PORTFOLIO IN SIX STATES

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Multi-Family Expertise Guides NYC Firm's First Foray in Mezzanine Lending

New York, NY – October 2005 -- Somerset Partners LLC, a New York City-based private real estate investor, has completed their first foray into the mezzanine lending arena with the closing of a $65 million intermediate mezzanine loan secured by a 38-property, 11,543-unit multi-family portfolio owned by Alliance Holdings and its affiliates. The mezzanine financing is part of a $650 million structured finance transaction originated by Wachovia Securities that will consolidate ownership of the portfolio into a single ownership structure.

The garden-style apartment assets, consisting of a mix of Class A and B properties in metropolitan areas of Texas , Arizona , Florida , Tennessee , Maryland and Georgia , were an attractive first investment for Somerset Partners' expansion into the mezzanine financing arena, according to Marshall Allan , co-founding partner of Somerset Partners, which owns over 3,000 quality multi-family apartments nationwide.

“This is the perfect start of our long-planned entrance into the mezzanine financing business, as the Alliance portfolio fits nicely with our core investment profile and makes great use of our multi-family acquisition and management expertise,” said Mr. Allan. “We're excited about this new venture, which further demonstrates that Somerset Partners will be an active investor whenever the right opportunity presents itself.”

In July, Somerset Partners acquired 85 Tenth Avenue , a 600,000-sq.ft. office building in the Chelsea sub-market of Manhattan for $300 million, representing the first office acquisition for company, which has built a $250 million portfolio of multi-family properties throughout the Southwest and Southeast U.S. over the last three years. In June, Somerset Partners announced the close of its $100 million Somerset Multi-Family Fund I, which is currently supporting an aggressive $400 million acquisition campaign of Class-A multifamily housing nationwide.

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Somerset Partners, LLC, is a private equity firm focused on the preservation and growth of wealth through investment in real estate for its investors and principals. With a focus on long-term ownership and high-quality multi-family assets in economically sound markets, Somerset Partners matches its investments with the specific portfolio requirements of its equity partners. Somerset Partners is owned and managed by Keith Rubenstein, Marshall Allan and Philip Welch.