Related Companies to Acquire Virgin Entertainment Group Virgin Megastores North America

    NEW YORK, Aug. 17 /PRNewswire/ -- Related Companies today announced the
 acquisition of Virgin Megastores North America. Virgin Megastores North
 America currently operates eleven stores nationally across 400,000 sq. ft.
 of retail space. The sale is expected to close in September of 2007.
     Related Companies President Jeff T. Blau said, "The acquisition of
 Virgin Megastores North America is a tremendous opportunity for Related to
 provide strategic value and exemplifies Related's investment strategy.
 Virgin Megastores is a well-managed premier retail brand of top-tier
 entertainment lifestyle stores. Their evidenced commitment to progressive
 business strategies and service makes them an ideal partner. We look
 forward to leveraging the resources and synergies between our two great
 brands."
     Sir Richard Branson, founder and chairman of the Virgin Group said,
 "Virgin Megastores in the U.S. has enjoyed a brilliant two decades as a
 music and lifestyle retailer, and I am so proud of what we've been able to
 offer consumers. With most of our global retail operations now franchised,
 Virgin Group will continue to focus on being a global leader in
 transportation and renewable energy, with interests in financial services,
 communications and media, health, and leisure."
     Simon Wright, CEO, Virgin Entertainment Group said, "We'd been looking
 for a strong investment firm to work with to continue the successful
 repositioning achieved by Virgin Megastores USA. Related has a strong track
 record of investment and shares Virgin's values. Consistent with Virgin
 Group's approach taken with partners elsewhere across the globe, we found
 an ideal partner in Related, one with an outstanding reputation and a
 shared belief in creating value to the consumer experience at Megastores."
     Continuing employment contracts have been put into place with senior
 management and Related expects to continue to make key investments into the
 company, its assets and its future. Virgin Megastores has experienced
 continued growth in 2007 with a 10% increase in comparable music sales
 through fourth period, and a 17% increase in overall comp sales over last
 year. Virgin Megastores have also seen significant sale increases in
 several other departments including an 11% increase in DVD sales and a 26%
 increase in interactive games' sales, together with an average increase of
 30% in fashion and electronics.
     The corporate acquisition is another example of Related's value added
 investment strategy. In 2006 Related acquired Equinox Holding Inc., the
 premier operator of upscale fitness clubs and spas in New York, Chicago,
 Los Angeles, San Francisco and South Florida. That same year, Related
 Companies was part of an investor group that brought leading international
 developer and operator of destination resorts, casinos and luxury hotels
 Kerzner International Limited private.
     About Related Companies:
     Heralded as one of the most prolific and visionary developers in the
 country, Related Companies was formed over thirty-five years ago. Today
 Related is considered the most prominent privately owned real estate
 development firm in the United States, headquartered in New York City with
 divisions in development, acquisitions, property management, marketing and
 sales. In 2004, Related completed the development of New York City's newest
 landmark, Time Warner Center. Related has offices and major developments in
 Miami, Los Angeles, San Francisco, Chicago and Boston and boasts a team of
 more than 2,000 professionals. To date, Related has real estate assets
 worth over $16 billion with another $10 billion currently in development.
 In Los Angeles, Related is expanding its portfolio with The Century, a
 super-luxury condominium in Century City and the Frank Gehry-designed Grand
 Avenue development, situated directly across from the beloved Walt Disney
 Concert Hall, which will include luxury residences, retail, notable
 restaurants and a world class hotel.
     Related Companies is staunchly committed to sustainable design with
 over $6 billion in green development underway or completed. The firm
 developed one of the first green residential buildings in the nation,
 Tribeca Green in Battery Park City, New York and Chicago's first green
 residential building, 340 on the Park. Related is currently developing
 eight new LEED-certified residential buildings, The Brompton, The Harrison,
 and Superior Ink in New York City, The Clarendon in Boston, The Century in
 Los Angeles, The Village in Santa Monica, Canyon Ranch Living and The
 Peshtigo in Chicago as well as Bronx Terminal Market, a one million square
 foot retail development in Bronx, New York and Snowmass, Colorado, a $2
 billion mixed-use redevelopment. Related also serves on the board of
 directors of the World Resources Institute.
     This past year, Related acquired Equinox(R) Fitness Clubs, further
 expanding the company's capabilities into the health and fitness arena and
 enhancing the value of its properties by incorporating an exclusive,
 branded amenity into the lifestyle offering. The company is also the
 largest shareholder in Centerline, the leading financier of affordable
 housing in the country. For more information about Related Companies please
 visit http://www.related.com.
     About Virgin Entertainment Group:
     Virgin Entertainment Group is the world's leading multi-channel music
 and entertainment retailer, providing customers with a range of superior
 entertainment experiences through a family of integrated Virgin-branded
 businesses. The "category killer" Virgin Megastores and Virgin Megastore
 Online at http://www.virginmega.com are integral parts of a strategy to
 provide entertainment customers with what they want, how they want it, and
 when they want it. For more information, or to check out the location of
 the nearest Virgin retail, go to http://www.virginmegamagazine.com
 
 

SOURCE Related Companies