FOR IMMEDIATE RELEASE

July 11, 2005

HARBOR GROUP INTERNATIONAL PURCHASES
RALEIGH, NORTH CAROLINA APARTMENT COMMUNITIES
IN TAX DEFERRED EXCHANGE TRANSACTION

Through a tax deferred exchange, affiliates of Harbor Group International (HGI) of Norfolk, Virginia have acquired the 235-unit Woods of North Bend apartment community and the 240-unit Woodscape apartment community in Raleigh, North Carolina for an undisclosed price.

$2,850,000 will be spent in interior and exterior upgrades at the properties.

Woods of North Bend, built in 1984, consists of one, two and three bedroom floor plans. Property amenities include a laundry facility, basketball court, sand volleyball court, lighted tennis courts, video library and swimming pool with sundeck. Dwelling units feature full size washer and dryer connections, ceiling fans, walk-in closets and a patio or balcony.

Woodscape, built in 1980, features multiple one and two bedroom floor plans. Property amenities include a fitness center, sand volleyball court, lighted tennis courts, laundry facility and a swimming pool with sundeck. Dwelling units feature ceiling fans, walk-in closets and a patio or balcony. Select units also feature full size washer and dryer connections, exterior storage and wood-burning fireplaces.

Since 1990, HGI has acquired over 11,000 apartments in Tennessee, Florida, Georgia, the Carolinas, Maryland, Arkansas, Alabama, Indiana, Ohio, and Virginia. HGI also owns Laurel Trace Apartments, Triangle Point Apartments and Waterford Village Apartments in the Raleigh-Durham market, which contain 362, 224 and 360 units respectively.

Harbor Group International, with offices in Norfolk, New York, Chicago and Tel Aviv, currently owns more than $1 billion worth of properties throughout the United States. For more information, visit Harbor Group International’s web page at www.harborgroupint.com.

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