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Chris Jones

Desert Passage Sale Likely

18 December 2003

LAS VEGAS -- A trio of independent sources close to the deal have confirmed Trizec Properties within the next few days will likely complete a deal to sell its Desert Passage at Aladdin shopping center to a group of East Coast investors.

A pair of sources said the $235 million deal, which was first reported by the Review-Journal in September, will close today or Friday. A third source was more cautious, however, saying the sale is likely to wrap up "before Monday" but could be pushed back until the middle of next week.

"There's been a little last-minute haggling, but it's very, very close," a source said.

All three individuals confirmed the 475,000-square-foot mall will be purchased by a group fronted by David Edelstein and investment firm RFR Holding.

Edelstein is a prominent New York developer. RFR is a German-owned investment firm that handles approximately 20 Manhattan properties, including the Seagram Building.

Aby Rosen, who heads New York-based RFR with business partner Michael Fuchs, said in September his group had "acquired the asset," though the group's members have since maintained a low profile until a deal is complete.

Trizec Chief Executive Officer Tim Callahan also said last month his company was in active negotiations with one bidder, though he refused to further discuss the deal until a sale is complete.

Chicago-based Trizec developed the Arabian-themed mall, which opened in August 2000, at a cost of approximately $300 million. Its sales have typically exceeded industry averages, but Trizec officials have described its performance as disappointing, thanks in large part to the financial struggles of the adjacent Aladdin hotel-casino.

Trizec has for months planned to unload the mall to better focus on the company's core portfolio of office properties. Spokesman Rick Matthews declined comment on the deal's status Tuesday.

A group fronted by Planet Hollywood Chairman Robert Earl plans to buy the Aladdin following a lengthy bankruptcy sales process. That approximately $635 million deal is expected to close sometime in 2004.