Blackstone Real Estate Advisors, based in New York and London, paid $480 million in cash, assumed $145 million of debt and gave Security Capital a five-year note for $115 million at 12% in its first year, with annual increases of 100 basis points.

"The sale of Homestead is in keeping with Security Capital's stated intention to exit businesses that do not fit the company's current strategy,'' explains Security Capital vice chairman C. Ronald Blankenship. "This strategy is to focus capital in six private real estate operating divisions that will lead the industry in high sustainable return on equity and earnings growth. This transaction places the company in an even stronger position to execute its strategy, as well as to fund additional share repurchases."

Occupancy at Homestead Village properties was 76.9% for the third quarter. September occupancy was down to 71.7%, 11 percentage points lower than September 2000.