Restructuring of 85,000 sq ft

Great Portland Estates PLC
07 January 2004

Great Portland restructures 85,000 sq ft at mid-town property

7 January 2004

Great Portland Estates plc ('GPE') has restructured 85,000 sq ft of its 104,000
sq ft mid-town holding at Barnard's Inn, 86 Fetter Lane, EC4, in three
simultaneous transactions:

-   the surrender of a lease on all 85,000 sq ft occupied by the building's 
    principal tenant, Interoute Finance Plc ('Interoute'), whose lease was due 
    to run until 2014, with a tenant's break in 2010. Interoute had defaulted on 
    its £2.4 million annual rent during the summer, requiring GPE to draw down 
    on a rent deposit held;

-   the release of the original tenant, MCI Worldcom Limited, from its residual 
    obligations; and

-   the leasing of 55,000 sq ft on basement, ground and first to third floors to 
    Marriott International Inc. ('Marriott'), the international hotel group.

As consideration for the surrender and the release of the original tenant, GPE
received a total of £12 million - the equivalent to rent for 5 of the
outstanding 61/4 years remaining until Interoute's break option.

The simultaneous letting of 55,000 sq ft was at an initial rent of £1.45 million
per annum (equivalent to a headline rate of £29.50 per sq ft). The lease is for
15 years with a tenant's break at the end of the tenth year, the exercise of
which is subject to a penalty of 21/2 years' rent, and is personal to Marriott.
Marriott has taken the building in its existing state, with cash of £3.75
million to cover refurbishment costs, and a nine month rent-free period.

These transactions are estimated to have increased the value of the building by
£2.5 million, which, together with cash receipts of £12 million, less the £3.75
million paid to Marriott, represent an increase in net asset value of over 5p
per share.

The remaining 27,800 sq ft of office space released on the 4th to 6th floors
will be refurbished by GPE at an estimated cost of £1.8 million and available to
let by mid 2004. Once let, total annual rent from the building is expected to be
£2.64 million, against £2.8 million passing prior to this transaction. As at
September 2003, CB Richard Ellis estimated the rental value to be £2.66 million.

Toby Courtauld, Chief Executive of GPE said:

'These three simultaneous transactions are the result of a plan set in motion in
June when our tenant, Interoute, failed to pay rent. They clearly demonstrate
our approach to asset management - we have strengthened our cash flow from the
property and considerably improved both its value and its liquidity'.

Contacts:

Toby Courtauld Chief Executive      Great Portland Estates plc  020 7612 1442
Robert Noel    Property Director                                020 7612 1443

Edward Orlebar                      Finsbury                    020 7251 3801
Gordon Simpson




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