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Kettler Purchases Pentagon City Land for $220 Million

Ten-Phase, 3,200-unit Transit Oriented Development

May 14, 2007

Kettler, one of the Washington area’s leading diversified real estate development and property management companies, announced today that it has purchased 19.6 acres in Pentagon City from affiliates of Vornado Realty Trust for approximately $220.4 million. Kettler closed on the initial 11 acres today for $104.3 million, and plans to purchase the remaining acreage over the next year.

“This purchase gives us a long-term stake in one of Washington’s most dynamic urban neighborhoods, and it deepens our established commitment to Arlington County and Pentagon City,” said Robert C. Kettler, founder and chairman of Kettler.

For more than seven years, Kettler (formerly KSI) has been the ground lessee of the 19.6 acres for a ten-phase apartment development of 3,850 units. With today’s purchase the firm takes title to the land under its existing and future buildings on the tract, which lies east and west of the Pentagon City Fashion Centre. To date, the firm has built 1,050 high rise apartments on the first three of the ten phases, including The Metropolitan at Pentagon Row, The Metropolitan at Pentagon City and The Gramercy at Metropolitan Park.

According to Kettler President, Richard W. Hausler, “The Pentagon tract is unique for its size and location on two major Metro lines with rail access to every part of the D.C. area.” Over coming years, he said, “We look forward to working with Arlington County in completing this extraordinary transit oriented development.”

Established Kettler developments on the Pentagon land include The Metropolitan at Pentagon City, which delivered 325 units in 2002 and The Metropolitan at Pentagon Row, which delivered 326 units in 2005. The latest Kettler undertaking in Pentagon City is The Gramercy at Metropolitan Park, a 399-unit apartment building which is nearing completion and set to open this summer. The Gramercy features architecture and interiors by renowned New York architect, Robert A.M. Stern. Future phases of Pentagon development include an additional 2,183 units -- and Stern also penned the master plan for these upcoming phases.

“Robert A.M. Stern brings a new dimension in urban design to this market,” stated Kettler.

About Kettler

Based in Northern Virginia and celebrating its 30th anniversary in 2007, Kettler is a leading developer of award-winning, mixed-use residential and commercial properties across the Washington Metropolitan area. In 2007, Kettler was named one of the area’s largest private companies by the Washington Business Journal and is one of the nation’s top 15 multifamily developers. Kettler has developed more than five million square feet of commercial space and more than 50,000 homes. The company also owns and manages 9,000 apartments in 40 locations. Current projects include urban and transit-oriented developments, multifamily housing, commercial and mixed-use developments and resort communities.