Warner Estate Holdings PLC 08 June 2005 WARNER ESTATE AND MORLEY FORM £254m REGIONAL OFFICE FUND Warner Estate Holdings PLC and Morley Fund Management have announced the formation of the Apia Regional Office Fund. The Fund will invest in large office properties in major regional cities throughout the UK and will be open to institutional investment via cash or by contributing suitable property assets. The Fund's portfolio will initially comprise four properties owned by Morley on behalf of its life fund clients and nine properties owned by Warner Estate, of which eight were previously in the Skipper Regional Office Fund, a joint venture between Warner Estate and The Royal Bank of Scotland. The portfolio has a current rent roll of £17.3m and the total space under management will be 1.1 million sq ft. The aim of the Fund will be to produce consistent high investment returns from the ownership and active management of the property portfolio, with the emphasis on income generation. Warner Estate will act as asset manager, responsible for sourcing suitable assets and for the active management of the properties and Morley will act as fund manager, responsible for attracting clients, funding and overall fund strategy. Philip Warner, Chairman of Warner Estate commented, " This is an important step in our stated strategy to increase both the institutional investor base of our funds and the quantum of property assets under management. We are very pleased that Morley Fund Management has recognised the ability of our specialist asset management team to add value and to deliver an impressive performance. Our objective is to expand the Fund as we target further properties and Morley attracts further clients." Richard Jones, Head of Life Property Funds at Morley commented, " Warner Estate has a track record of delivering outstanding performance from its stable of property funds. We have been impressed by the quality of its property team and with the innovative approach it has to adding value to all of the properties that it manages. " This joint venture fits with our successful property business model, where we seek to team up with property partners who are specialists in their chosen sectors. Morley brings extensive fund management expertise to these partnerships, whilst drawing on the asset knowledge of the partner. "The Apia Regional Office Fund will not only be an excellent vehicle for investors looking to gain exposure to the UK office sector, but also for those who are looking to diversify their risk and benefit from Warner Estate's specialist skills by injecting their own properties into the Fund." Johnny Cameron, Chief Executive, The Royal Bank of Scotland, Corporate Banking and Financial Markets, commented, "Our relationship with Warner Estate has been excellent. We are delighted to be lenders to the expanded fund and we remain impressed with the quality of the Warner Estate team." Following the launch of the fund, Warner Estate will have approximately £1.9 billion of property under management. This fund launch follows the announcement of Warner Estate's recommended offer for fellow quoted property investment company Ashtenne Holdings PLC being declared wholly unconditional. DTZ Debenham Tie Leung is acting as advisor to Warner Estate and Morley Fund Management. The Apia Regional Office Fund has the following assets, valued at £254 million: •Apex 123 in Edinburgh (94,683 sq ft) •Bath Street, Glasgow (88,084 sq ft) •St Ann's Wharf, Newcastle (58,272 sq ft) •Yorkshire House, Leeds (81,293 sq ft) •Norfolk House, Manchester (54,358 sq ft) €81 Fountain Street, Manchester (40,100 sq ft) €120 Edmund Street, Birmingham (137,384 sq ft) •Sapphire Court, Solihull (86,553 sq ft) •Ashton and Norfolk House, Milton Keynes (140,000 sq ft) •Westgate House, Colston Avenue, Bristol (90,924 sq ft) •Oakleigh House, Cardiff (41,038 sq ft) •Lever & Surrey House, Kingston upon Thames (159,661 sq ft) •St Georges East, Wimbledon (44,000 sq ft) ___________ 1,114,528 sq ft -ends- Date: 8 June 2005 For further information contact: Warner Estate Holdings PLC Morley Fund Management Philip Warner, Chairman Richard Jones, Head of Life Property Funds Richard Moore, Property Director Tel: 020-7809-6000 Peter Collins, Finance Director Tel: 020-7907-5100 Web: www.warnerestate.co.uk DTZ Debenham Tie Leung The Royal Bank of Scotland Mike Cutteridge, Director Shaun Gamble, Media Relations Manager Tel: 020-7643-6350 Tel: 020-7672-1921 City Profile Simon Courtenay Tel: 020-7448-3244 About Morley Fund Management Morley Fund Management ('Morley') is a London based, asset management business with over £128 billion* under management. The property team manages in excess of £15 billion* of UK and European property assets, making Morley the largest property fund manager in Europe. Winners of the high profile Property Week Fund Manager of the Year Award 2004 and the UK Pensions Awards Property Fund Manager of the Year 2005, the team consists of 60 investment professionals and manages a range of funds on behalf of institutional, pension and retail clients. Morley has been at the forefront of innovation in property fund management and has launched twelve specialist sector based funds with partners, including the Jersey-based Unit Trusts: Igloo Regeneration Fund, Quercus Healthcare Property, The Junction and The Mall. Visit www.morleyproperty.com *Not including mortgage assets, as at 31/03/05 This information is provided by RNS The company news service from the London Stock Exchange