Reckson Announces Redemption of 2,000,000 Shares of Series A Convertible Cumulative Preferred Stock

Business Wire, August 18, 2004

MELVILLE, N.Y. -- Reckson Associates Realty Corp. (NYSE:RA) announced today that it has called for the partial redemption of its 7 5/8% Series A convertible cumulative preferred stock (NYSE:RA.A) (Cusip No.: 75621K205) on September 20, 2004 (the "Redemption Date"), at a redemption price of $25.7625 per share of Series A preferred stock, plus accumulated and unpaid dividends to the Redemption Date of $0.2595 per share. The 2,000,000 shares of Series A preferred stock to be redeemed (the "Redemption Shares") have been selected for redemption on a pro rata basis, representing approximately 27.2% of the total number of outstanding preferred shares.

The Redemption Shares will be redeemed in cash on a pro rata basis as nearly as is practicable so that each holder of record on September 20, 2004, will have approximately 27.2% of their preferred shares redeemed. The pro rata redemption will be effected on a "half-adjusted" basis with any fractional share above 0.5 of a share being rounded up for purposes of calculating the number of shares being redeemed and any fractional share below 0.5 of a share being rounded down.

The redemption price plus accumulated and unpaid dividends will be payable in cash to the holders of record on September 20, 2004, upon and subject to the surrender of the certificates representing the Redemption Shares to American Stock Transfer & Trust Company as redemption agent, at 59 Maiden Lane, New York, New York 10038, by first class mail or other form of commercially reasonable delivery on or after the Redemption Date. On the Redemption Date, the accumulation of dividends on the Redemption Shares will cease. The accumulation of dividends on all unredeemed shares of Series A preferred stock shall continue.

The right of each holder to elect to convert Redemption Shares into shares of common stock, par value $0.01 per share, at a conversion price of $28.51 per share of common stock, will terminate on the close of business on September 13, 2004, which is the fifth business day prior to the Redemption Date.

The Notice of Redemption and related materials will be mailed on or about August 18, 2004, to holders of record on August 18, 2004. Questions relating to the Notice of Redemption and related materials should be directed to American Stock Transfer & Trust Company at (800) 937-5449.

As a result of this redemption, and the Company's recent exchange of approximately 1.4 million shares of Series A preferred stock, annual preferred dividends will decrease by approximately $6.4 million.

In accordance with Emerging Issues Task Force ("EITF") Topic D-42, the Company will incur a non-recurring accounting charge during the third quarter of 2004 on this transaction and on the recent exchange of approximately $7.0 million.

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, with 85 properties comprised of approximately 15.4 million square feet either owned or controlled, or under contract. 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 (including FrontLine Capital Group); 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.