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                           PURCHASE AND SALE AGREEMENT




                  PURCHASE AND SALE AGREEMENT (this "Agreement"), dated the 28th
day of April, 2000, by and between Munsey Park Associates, LLC, a New York
limited liability company ("Munsey Park"), North Shore Triangle, LLC, a New York
limited liability company ("Glen Cove"), Philips Yonkers, LLC, a New York
limited liability company ("Yonkers"), Philips Henry, LLC, a New York limited
liability company ("Henry Street"), Philips Shopping Center Fund, L.P., a
Delaware limited partnership ("SCF") and Philips Lake Mary Associates, L.P., a
Delaware limited partnership ("Lake Mary"), each having an office c/o Philips
International Realty, L.P., 417 Fifth Avenue, Third Floor, New York, New York
10016 (each, a "Seller"; and, collectively, the "Sellers"), and Kimco Income
Operating Partnership, L.P., a Delaware limited partnership having an office at
3333 New Hyde Park Road, Suite 100, P.O. Box 5020, New Hyde Park, New York
11042-0020 ("Purchaser").

                               W I T N E S S E T H

         WHEREAS, each Seller (except for Yonkers) is the owner of certain
plots, pieces and parcels of real property as set forth on Schedule "1" annexed
hereto and incorporated herein by this reference (each, a "Property", and,
collectively, the "Properties"), each as more particularly described on
Schedules 1.1 through 1.6 annexed hereto and incorporated herein by this
reference.

         WHEREAS, the Sellers (except for Yonkers) desire to sell and Purchaser
desires to purchase from the Sellers all of the Properties set forth on Schedule
"1" hereto;

         WHEREAS, pursuant to that certain ground lease dated June 22, 1972 (as
amended, the "Ground Lease"), by and between Central Arcade Company ("Ground
Lessor"), and AVR Realty Corp., the predecessor-in-interest of Yonkers, Yonkers
leased from Ground Lessor the parcel of real property set forth on Schedule "1"
hereto, as more particularly described in Schedule 1.7 annexed hereto and
incorporated herein by this reference (the "Yonkers Property").

         WHEREAS, Yonkers desires to assign, and Purchaser desires to assume,
all of Yonkers' right, title and interest in and to the Ground Lease;

         WHEREAS, the Sellers and Purchaser desire to enter into an agreement
whereby, subject to the terms and conditions contained herein, the Sellers shall
sell the Group A Portfolio (as defined below) to Purchaser and Purchaser shall
purchase the Group A Portfolio from the Sellers.

         NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and the mutual
covenants and agreements hereinafter set forth, the mutual receipt and legal
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:

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         Section 1. Sale of Group A Portfolio

                  1.1 The Sellers (except for Yonkers) agree to sell and convey
to Purchaser, and Purchaser agrees to purchase from the Sellers, at the price
and upon the terms and conditions set forth in this Agreement, all of the
Properties, together with the following: (a) all buildings and other
improvements situated on the Properties (collectively, the "Buildings"); (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights of Seller pertaining to the Properties and the Buildings; (c)
all right, title and interest of Seller in and to the Leases (as defined below),
Intangible Property (as defined below), Security Deposits (as defined below) and
Licenses (as defined below); (d) all right, title and interest of Seller in and
to any transferable guaranties or warranties (to the extent transferable); (e)
all right, title and interest of Seller in and to the REAs (as defined below);
(f) all right, title and interest of Seller in and to all fixtures, machinery,
equipment, supplies and other articles of personal property attached or
appurtenant to the Properties or the Buildings, or used in connection therewith
(collectively, the "Personal Property"); (g) all oil, gas and mineral rights of
Seller, if any, in and to the Properties; (h) all right, title and interest of
Seller, if any, in and to the trade names of the Buildings; and (i) all right,
title and interest of Seller, if any, in and to all strips and gores, all alleys
adjoining the Properties, and the land lying in the bed of any street, road or
avenue, opened or proposed, in front of or adjoining the Properties to the
center line thereof and all right, title and interest of Seller, if any, in and
to any award made or to be made in lieu thereof and in and to any unpaid award
for any taking by condemnation or any damages to the Properties or the Buildings
by reason of a change of grade of any street, road or avenue.

                  1.2 Yonkers agrees to assign, and Purchaser agrees to assume,
at the price and upon the terms and conditions set forth in this Agreement, all
of Yonkers' right, title and interest in and to the Ground Lease, together with
all of Yonkers' right, title and interest, if any, in and to the following: (a)
all buildings and other improvements situated on the Yonkers Property
(collectively, the "Yonkers Buildings"); (b) all easements, rights of way,
reservations, privileges, appurtenances, and other estates and rights of Yonkers
pertaining to the Yonkers Property and the Yonkers Buildings; (c) all right,
title and interest of Yonkers in and to the Leases (as defined below),
Intangible Property (as defined below), and Licenses (as defined below); (d) all
right, title and interest of Yonkers in and to any transferable guaranties or
warranties (to the extent transferable); (e) all right, title and interest of
Yonkers in and to the REAs (as defined below); (f) all right, title and interest
of Yonkers in and to all fixtures, machinery, equipment, supplies and other
articles of personal property attached or appurtenant to the Yonkers Property or
the Yonkers Buildings, or used in connection therewith (collectively, the
"Yonkers Personal Property"); (g) all oil, gas and mineral rights of Yonkers, if
any, in and to the Yonkers Property; (h) all right, title and interest of
Yonkers if any, in and to the trade names of the Yonkers Buildings; and (i) all
right, title and interest of Yonkers, if any, in and to all strips and gores,
all alleys adjoining the Yonkers Property, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the Yonkers
Property to the center line thereof and all right, title and interest of
Yonkers, if any, in and to any award made or to be made in lieu thereof and in
and to any unpaid award for any taking by condemnation or any damages to the


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Yonkers Property or the Yonkers Buildings by reason of a change of grade of any
street, road or avenue.

                  1.3 The Properties, together with all of the items listed in
Sections 1.1 (a)-(i) and the Ground Lease, together with all of the items listed
in Sections 1.2(a)-(i), are hereinafter sometimes collectively referred to
herein as the "Group A Portfolio".

         Section 2. Purchase Price

                  2.1 (a) The purchase price to be paid by Purchaser to Seller
for the Group A Portfolio (the "Purchase Price") is Sixty Eight Million, Three
Hundred Twenty Five Thousand and No/100 ($68,325,000.00) Dollars, subject to
adjustment as expressly set forth herein, payable as follows:

                      (i) Six Hundred Eighty Three Thousand Two Hundred and
Fifty ($683,250.00) Dollars (the "Downpayment") simultaneously with the
execution and delivery of this Agreement, by a bank wire transfer of immediately
available funds to an account designated by Pryor Cashman Sherman & Flynn LLP
("Escrow Agent"). The Downpayment shall be held by Escrow Agent in accordance
with the terms of Section 19. If the Closing (as hereinafter defined) shall
occur, Seller shall be entitled to receive the Downpayment and all interest
accrued thereon, if any, and such interest shall be credited against the portion
of the Purchase Price payable pursuant to Section 2.1(a)(iii);

                      (ii) An amount equal to the aggregate outstanding balance
of the Mortgages (as defined below) assumed by Purchaser, as of the Closing
Date, as set forth in Section 18; and

                      (iii) Sixty Seven Million Six Hundred Forty One Thousand
Seven Hundred Fifty and No/100 ($67,641,750.00) Dollars, as decreased by the
amount set forth in Section 2.1(a)(ii), and subject to further adjustment as
expressly set forth herein, at the Closing by bank wire transfer of immediately
available funds to an account designated by the Sellers on or before the Closing
Date (as hereinafter defined).

                  (b) The Purchase Price set forth above is the aggregate amount
to be paid to Seller for the Group A Portfolio, and the portion of the Purchase
Price allocable to each Property is as set forth below:

                     (i)     Munsey Park, NY                      $18,600,000.00
                     (ii)    Glen Cove, NY                        $ 9,500,000.00
                     (iii)   Yonkers, NY                          $ 9,700,000.00
                     (iv)    Freeport, NY (Henry Street)          $ 3,800,000.00
                     (v)     Orlando, FL (Bay Hill)               $13,250,000.00
                     (vi)    Key Largo, FL (Trade Winds)          $11,800,000.00
                     (vii)   Lake Mary, FL                        $ 1,675,000.00


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                                                         TOTAL:   $68,325,000.00
                                                                  ==============

The Downpayment set forth above is the aggregate amount to be deposited for the
Group A Portfolio, and the portion of the Downpayment allocable to each Property
is as set forth below:

                      (i)     Munsey Park, NY                        $186,000.00
                      (ii)    Glen Cove, NY                          $ 95,000.00
                      (iii)   Yonkers, NY                            $ 97,000.00
                      (iv)    Freeport, NY (Henry Street)            $ 38,000.00
                      (v)     Orlando, FL (Bay Hill)                 $132,500.00
                      (vi)    Key Largo, FL (Trade Winds)            $118,000.00
                      (vii)   Lake Mary, FL                          $ 16,750.00
                                                            TOTAL:   $683,250.00
                                                                     ===========

                  (c) Sellers and Purchaser agree that Sellers must convey and
Purchaser must purchase all of the Group A Portfolio in accordance with the
terms of this Agreement, subject to all relevant provisions of this Agreement,
and that the refusal of Seller to convey all of the Group A Portfolio or the
failure of Purchaser to purchase all of the Group A Portfolio in accordance with
the terms and conditions of this Agreement shall be a default hereunder and
permit the non-defaulting party to exercise its remedies provided for in this
Agreement.

         Section 3. Apportionments

                  3.1 (a) The following shall be apportioned for each Property
(or the Ground Lease), to the extent applicable, between each Seller and
Purchaser at the Closing as of 11:59 p.m. of the day preceding the Closing Date:

                           (i) All base or minimum rents ("Base Rent") and
Additional Rent (as defined below; and together with the Base Rent, the "Rent")
and other amounts payable by Tenants (as defined below), if, as and when
received. Purchaser shall not be obligated to make any payment or give any
credit to Seller on account of or by reason of any Rent payments which are
unpaid as of the date of Closing, but shall be required merely to turn over
Seller's share of the same within ten (10) days if, as and when received by
Purchaser after the Closing (subject to Section 3.3). Purchaser shall not be
required to institute any action or proceeding to collect any Rent
delinquencies.

                           (ii) Real estate taxes, water charges, sewer rents
and vault charges, if any, on the basis of the fiscal years, respectively, for
which same have been assessed, regardless of whether or not then due and payable
or a lien. Each Seller shall pay at or prior to Closing (or Purchaser shall
receive a credit for) any unpaid taxes attributable to periods prior to the date
of Closing (whether or not then due and payable or a lien as aforesaid), and
Seller shall receive a credit for any previously paid or prepaid taxes
attributable to periods from and after the date of Closing. Notwithstanding the
foregoing, Section 3.8 shall govern with respect to all general, special and/or
betterment assessments on each Property at the date of Closing.


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                           (iii) The actual cost to said Seller of the fuel
stored on such Property (or the Yonkers Property), including any taxes, on the
basis of a statement from said Seller's supplier.

                           (iv) Intentionally Deleted.

                           (v) Fees for inspections, permits or licenses which
are transferred to Purchaser at the Closing.

                           (vi) Seller shall use good faith efforts to arrange
for cut off and final meter readings for all utilities serving the Property (or
the Yonkers Property), on the day prior to the Closing. In the event that final
meter readings are not available, utilities (including telephone, steam,
electricity and gas) shall be adjusted on the basis of the most recently issued
bills therefor, subject to adjustment after the Closing when the next bills are
available.

                           (vii) Intentionally Deleted.

                           (viii) Personal property taxes, if any, on the basis
of the fiscal year for which assessed.

                           (ix) Seller's share, if any, of all revenues from the
operation of such Property other than Rent (including parking charges, and
telephone booth and vending machine revenues), if, as and when received.

                           (x) Permitted administrative charges, if any, on
those Tenants' Security Deposits (as defined below) transferred by Seller
pursuant to Section 10.1(c).

                           (xi) Intentionally Deleted.

                           (xii) Intentionally Deleted.

                           (xiii) All brokerage and leasing commissions or other
compensation due or accrued to any broker, agent, or other person in connection
with such Property for brokerage or other services rendered to said Seller or
any predecessor of said Seller in connection with or on account of the Leases
shall (A) be paid by Seller in connection with any Lease (or extension of
modification option with respect thereto) which has been executed and delivered
(or exercised) by the parties thereto prior to the execution and delivery of
this Agreement; (B) be paid by Purchaser in connection with any Lease (or
extension or modification option with respect thereto) which has been executed
and delivered (or exercised) by the parties thereto after the Closing Date; and
(C) be adjusted as set forth in Sections 12.1(a)(iii) hereof in connection with
any Lease (or extension or modification option with respect thereto) which has
been executed and delivered (or exercised) by the parties thereto, and for which
the payment of all Rent shall have commenced, after the execution and delivery
of this Agreement and prior to the Closing.


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                           (xiv) All prepaid rentals, other prepaid payments,
Security Deposits (to the extent not applied by Seller prior to the execution of
this Agreement), electric, gas, sewer and water deposits deposited with said
Seller by tenants (including all accrued interest on all of the foregoing,
unless said Seller is entitled to retain the benefit thereof) under any Leases,
license agreements or concession agreements relating to such Property, shall all
belong to Purchaser. Notwithstanding the foregoing, Purchaser shall receive at
Closing a cash credit in the amount of all such deposits, prepaid rentals, and
other prepaid payments, which shall all be retained by Seller unless otherwise
required by Law, any lender or any Lease. Notwithstanding anything to the
contrary contained in this Agreement, an Estoppel Certificate shall not be
deemed to conflict with Seller's representations and warranties in the event
that such estoppel reflects that Seller has applied all or any portion of a
Tenant's Security Deposit in accordance with the terms of the applicable Lease.

                           (xv) Percentage rent (i.e., that portion of the rent
payable to the landlord by a tenant under a Lease (sometimes herein referred to
as a "Tenant") which is a percentage of the amount of sales or of the dollar
amount of sales), if any, payable under each Lease shall be prorated with
respect to the lease year thereunder in which the Closing occurs on a per diem
basis as and when collected. Any percentage rent collected by Purchaser,
including any percentage rent which is delinquent and pertaining to (i) an
entire lease year or accounting period of a Tenant under a Lease which ends on a
date prior to the date of Closing, and (ii) that portion of a lease year or
accounting period of such Tenant covering a period prior to the date of Closing
where such lease year or accounting period begins prior to the date of Closing
and ends thereafter, shall in both cases (subject to Section 3.4) be paid to
Seller within ten (10) days of receipt by Purchaser. Purchaser shall not be
required to institute any action or proceeding to collect any delinquent
percentage rent.

                           (xvi) Common area maintenance expenses and charges,
including all expenses and charges payable by or to Seller under or in
connection with the reciprocal easement and operating agreements in place for
such Property (or Ground Lease)(each an "REA"), shall be prorated. Seller shall
be responsible for all common area expenses and charges incurred prior to
Closing, and Purchaser shall be responsible for the same incurred by Purchaser
subsequent to Closing. All common area expense payments made by each Tenant and
such charges paid under its Lease for the entire lease year during which the
Closing occurs, and all common area maintenance payments to Seller by other
parties under the REAs, including in each case end-of-year adjustments, if any,
shall be prorated between Seller and Purchaser in the following manner: not
later than three (3) days prior to Closing, Seller shall deliver to Purchaser,
with regard to each Tenant (or each other party to the REAs, hereafter an "REA
Party") required to pay common area maintenance charges ("CAM Charges") under
its Lease (or operation and maintenance and related costs under the REA), a
detailed computation showing all CAM Charge expenses incurred by Seller for the
period from the beginning of each such Tenant's (or REA Party's) then current
billing period for CAM Charges (e.g., calendar year, lease year, etc.) through
the Closing Date, any CAM monthly estimates or charges theretofore collected by
Seller relating to such Tenant (or REA Party) (hereinafter referred to as the
"CAM Estimates"), and a bill for the Tenant's (or REA Party's) pro rata share of
CAM Charges (i.e., for CAM charges through the Closing Date net of any such CAM
Estimates), together with all invoices and other evidence


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documenting such CAM Charges in detail required by such Tenant's lease (or the
REA). Purchaser shall send any such bills to Tenants (or REA Parties) promptly
following Closing, in which event such Tenant (or REA Party) shall pay any
amount shown due directly to Seller, and Purchaser shall have no responsibility
to collect same; or, in the event that such Tenant refuses to accept Seller's
bill, Purchaser (as and when appropriate for annual reconciliation or other
billing of CAM Charges for any tenant [or REA Party]) shall send two bills to
such Tenant (or REA Party) (i.e., one for pre-Closing charges as prepared by
Seller and one for post-Closing charges), with such Tenant (or REA Party) to pay
Seller directly for unpaid pre-Closing charges if any. Any CAM Estimates for any
Tenant shall be retained by Seller up to the amount of the pre-Closing CAM
Charges payable by such Tenant as evidenced by such bills and computations
delivered by Seller at Closing, and any excess shall be credited to Purchaser at
Closing, provided that such credit is not prohibited by the Lease, applicable
Law or any lender.

                           (xvii) Purchaser shall not be responsible for any
charges, salaries, vacation pay or fringe benefits of employees of Seller prior
to or following the Closing and none of the foregoing shall be prorated.

                           (xviii) Interest on the Property Notes (as defined
below); Seller shall be responsible for all interest attributable to the period
up to and including the day before Closing, and, provided that Purchaser wires
the Purchase Price to Seller prior to 12:00 p.m. on the Closing Date, Purchaser
shall be responsible for all interest attributable to periods on, from and after
the Closing Date. Any escrows and/or reserves held by the Mortgagees (as defined
below) under the Mortgages (as defined below)(hereinafter referred to in the
aggregate as the "Mortgage Escrows") shall be assigned to Purchaser at the
Closing, and Seller shall receive a credit at Closing for the amounts thereof
(as set forth in the Mortgagee Consents, as hereinafter defined).
Notwithstanding the foregoing, the insurance escrow at Munsey Park (as set forth
in Section 7.1(a)(xix)) shall not be assigned to (or assumed by) Purchaser at
the Closing, and shall be remitted to Seller by the lender at or promptly
following the Closing, and the Purchase Price shall not be affected thereby.

                           (xix) Intentionally Deleted.

                           (xx) As to the Ground Lease, Rent payable by Yonkers,
as ground lessee, pursuant to the terms thereof.

                           (xxi) As to such Property (or Ground Lease), such
other items as are customarily apportioned between sellers and purchasers of
real property of a type similar to such Property (or Ground Lease) and located
in the city and state where such Property (or Ground Lease) is located.

                  3.2 If the Closing shall occur before a new real estate or
personal property tax rate is fixed, the apportionment of taxes at the Closing
shall be upon the basis of the old tax rate for the preceding fiscal year
applied to the latest assessed valuation. Promptly after the new tax rate is
fixed, the apportionment of taxes shall be recomputed and any discrepancy
resulting from


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such recomputation and any errors or omissions in computing apportionments at
Closing shall be promptly corrected and the proper party reimbursed.

                  3.3 If on the Closing Date any Tenant is in arrears in the
payment of Base Rent or has not paid the Base Rent payable by it for the month
in which the Closing occurs (whether or not it is in arrears for such month on
the Closing Date), any Base Rent received by Purchaser or Seller from such
Tenant after the Closing shall be applied first, to all Base Rent due and
payable by such Tenant during the month in which the Closing occurs; thereafter,
Seller shall not be entitled to any further Base Rent unless and until such
Tenant is current with Purchaser on all post-Closing Base Rent.

                  3.4 In the event that there remains any unpaid tenant
receivable other than Base Rent (including without limitation any CAM,
escalation charges for real estate taxes, parking charges, operating expenses,
maintenance escalation rents or charges, insurance expenses, percentage rent
payments, cost of living increases or other charges of a similar nature
(collectively, "Additional Rent")) for any period prior to the Closing, all such
receivable payments received from any Tenant in arrears shall be applied to any
Additional Rent owed Purchaser from such Tenant before any part thereof shall be
treated as belonging to Seller. In the event that Purchaser receives a tenant
receivable for which Purchaser received a credit at the Closing, such receivable
(to the extent that Purchaser received a credit at Closing) shall all be
promptly payable to Seller, regardless of whether or not such Tenant is current
with Purchaser.

                  3.5 After the Closing, Seller shall continue to have the
right, in its own name, to demand payment of and to collect Rent arrearages owed
to Seller by any tenant, which right shall include the right to continue or
commence legal actions or proceedings against any Tenant (other than for
recovery of possession or termination of the lease), and delivery of the Lease
Assignment shall not constitute a waiver by Seller of such right. Purchaser
agrees to reasonably cooperate with Seller (at Seller's sole cost) in connection
with all efforts by Seller to collect such Rent and to take all steps after the
Closing Date as may be reasonably necessary to carry out the intention of the
foregoing, including adding the Rent arrearages to bills to Tenants for current
rent obligations and, on behalf of Seller, whether before or after the Closing
Date, as may be reasonably necessary to carry out the intention of the
foregoing, including the delivery to Seller, upon demand, of copies of any
relevant books and records (including any rent or Additional Rent statements,
receipted bills and copies of Tenant checks used in payment of such rent or
Additional Rent), the execution of any and all consents or other documents, and
the undertaking of any act reasonably necessary for the collection of such Rent
by Seller (except litigation or lease termination), Seller hereby agreeing not
to commence or continue any proceedings against such Tenant to terminate said
Tenant's tenancy or to dispossess such Tenant or otherwise disturb such Tenant's
occupancy.

                  3.6 If, subsequent to Closing but on or before December 31,
2000, any Tenant makes a claim against Purchaser for any overcharge (including
without limitation the withholding of any Rent by reason thereof) or in
connection with any deposits referenced in Section 3.1(a)(xiv), Seller will and
hereby agrees to indemnify, defend and hold Purchaser harmless from and against
any loss, expense or damage (including without limitation withheld


                                       8
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Rent or reasonable attorneys' fees) arising from or relating to any such alleged
overcharge (or rent withholding) and/or deposit in connection therewith. The
provisions of this Section shall be subject to the limitations set forth in
Section 24.5, and shall survive the Closing until December 31, 2000.

                  3.7 If any of the items subject to apportionment under the
foregoing provisions of this Section 3 cannot be apportioned at the Closing
because of the unavailability of the information necessary to compute such
apportionment, or if any errors or omissions in computing apportionments at the
Closing are discovered subsequent to the Closing, then such item shall be
reapportioned and such errors and omissions corrected as soon as practicable
after the Closing Date and the proper party reimbursed, which obligation shall
survive the Closing for a period of one (1) year after the Closing Date as
hereinafter provided. Neither party hereto shall have the right to require a
recomputation of a Closing apportionment or a correction of an error or omission
in a Closing apportionment unless within the aforestated one (1) year period one
of the parties hereto (a) has obtained the previously unavailable information or
has discovered the error or omission, and (b) has given notice thereof to the
other party together with a copy of its good faith recomputation of the
apportionment and copies of all substantiating information used in such
recomputation. The failure of a party to obtain any previously unavailable
information or discover an error or omission with respect to an item subject to
apportionment hereunder and to give notice thereof as provided above one (1)
year after the Closing Date shall be deemed a waiver of its right to cause a
recomputation or a correction of an error or omission with respect to such item
after the Closing Date.

                  3.8 (a) If, on the date of this Agreement, any Property (or
the Yonkers Property) or any part thereof shall be affected by any assessment or
assessments which are or may become payable in installments, of which the first
installment is now a charge or lien, or has been paid, then Seller shall be
obligated to pay all installments of any such assessment, and unpaid
installments of any such assessment which are to become due and payable on or
after the Closing Date shall be deemed to be liens upon the applicable Property
(or the Yonkers Property) which Seller shall either pay or credit Purchaser at
Closing for the amount thereof.

                      (b) If, subsequent to the date hereof, any Property (or
the Yonkers Property) or any part thereof shall become affected by an assessment
or assessments, said assessment shall not be deemed to be a lien upon such
Property (or the Yonkers Property) and Purchaser shall take title to such
Property (or the Ground Lease) subject to such assessment, but Seller and
Purchaser shall apportion such assessment, as of 11:59 p.m. of the day preceding
the Closing. In the event any such assessment or assessments, whether payable in
lump sum or in installments, is due and payable prior to the Closing, and has
been paid in whole or in part by Seller, Purchaser (subject to the preceding
sentence) shall reimburse Seller for its share of same at the Closing.

                  3.9 In the event that any Tenant shall hereafter apply or
shall have heretofore applied for relief under the provisions of any bankruptcy
or similar laws for the protection of debtors, the provisions of Section 3.3
shall not apply, and the parties shall have the right to seek


                                       9
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collection of their respective accounts, their entitlements being determined by
the Closing and the other provisions of this Agreement.

                  3.10 Neither party shall have the right to enter into any
transactions that purport to compromise claims belonging to the other, without
the other party's prior written consent.

                  3.11 The provisions of this Section 3 shall survive the
Closing for a period of one (1) year.

         Section 4. Closing Date

                  4.1 The delivery of the Deeds and the Ground Lease Assignment
and the consummation of the transactions contemplated by this Agreement (the
"Closing") shall take place at the offices of Pryor Cashman Sherman & Flynn LLP,
410 Park Avenue, 10th Floor, New York, New York, at 9:00 a.m., EST, within
fifteen (15) days of the latest to occur of (a) receipt of all Mortgagee
Consents; (b) expiration of the Inspection Period (as defined below); or (c)
satisfaction or waiver of the conditions set forth in Section 9 hereof (the
"Closing Date").

         Section 5. Permitted Encumbrances

                  5.1 The Sellers (except Yonkers) shall convey and Purchaser
shall accept title to the Group A Portfolio subject only to those matters set
forth on Schedule "5.1" annexed hereto and made a part hereof (collectively, the
"Permitted Encumbrances"). Yonkers shall assign, and Purchaser shall accept and
assume, the Ground Lease subject to the Permitted Encumbrances. Notwithstanding
the foregoing, the term Permitted Encumbrances shall include any and all
Schedule B-II exceptions in the Commitments relating to loans, leases and
tenancies which are no longer in full force and effect; provided, that Seller
delivers to the Title Company an affidavit reasonably acceptable to the Title
Company stating that the lenders, tenants or occupants to which such exceptions
relate are no longer tenants or occupants at the applicable Property (or Ground
Lease), and the Title Company agrees to omit such exception from the Commitments
and/or the policies issued in connection therewith.

         Section 6. Title

                  6.1 (a) Purchaser shall order, at its sole cost and expense,
commitments for an owner's fee title policy or policies with respect to each of
the Properties, or in the case of the Yonkers property, a leasehold insurance
policy (each, a "Commitment", and, collectively, the "Commitments") from Lawyers
Title Insurance Corporation (the "Title Company") and shall request the Title
Company to deliver copies of the Commitments, together with true and complete
copies of all instruments giving rise to any defects or exceptions to title to
each Property (and the Ground Lease), to Purchaser's and Seller's attorneys. If
the Commitments indicate the existence of any liens, encumbrances or other
defects or exceptions in or to title to any Property (or the Ground Lease) other
than the Permitted Encumbrances (collectively, the "Unacceptable Encumbrances")
subject to which Purchaser is unwilling to accept title and Purchaser gives
Seller notice of the same not less than ten (10) days prior to the expiration of
the


                                       10
<PAGE>

Inspection Period, Seller shall undertake to eliminate the same subject to
Section 6.2. Purchaser hereby waives any right Purchaser may have to advance as
objections to title or as grounds for Purchaser's refusal to close this
transaction any Unacceptable Encumbrance which Purchaser does not notify Seller
of prior to such ten (10) day period unless (i) the Commitment has been issued
to Purchaser prior to the expiration of the Inspection Period and (x) such
Unacceptable Encumbrance was first raised by the Title Company subsequent to the
expiration of the Inspection Period or (y) Purchaser shall otherwise first
discover same or be advised of same subsequent to the expiration of the
Inspection Period, and (ii) Purchaser shall notify Seller of the same within ten
(10) days after Purchaser first becomes aware of such Unacceptable Encumbrance
(failure to so notify Seller shall be deemed to be a waiver by Purchaser of its
right to raise such Unacceptable Encumbrance as an objection to title or as a
ground for Purchaser's refusal to close this transaction). Seller, in its sole
discretion, may adjourn the Closing one or more times for up to thirty (30) days
in the aggregate in order to eliminate Unacceptable Encumbrances.

                  (b) If Seller is unable (subject to Section 6.2) to eliminate
all Unacceptable Encumbrances not waived by Purchaser, or to arrange for title
insurance insuring against enforcement of such Unacceptable Encumbrances
against, or collection of the same out of, the applicable Property (or Ground
Lease), and to convey title in accordance with the terms of this Agreement on or
before the Closing Date (whether or not the Closing is adjourned as provided in
Section 6.1), Purchaser shall elect on the Closing Date, as its sole remedy for
such inability of Seller, either (i) to accept title subject to such
Unacceptable Encumbrances and receive no credit against, or reduction of, the
Purchase Price, except as set forth in Section 6.2; or (ii) to postpone the
Closing for the affected Property (or Ground Lease)(each, a "Post-Closing
Property"), such that the affected Property (or Ground Lease) shall be subject
to the provisions of Section 9.3, the Purchase Price payable at the Closing
shall be reduced by the amount set forth in Section 2.1(b) for such Post-Closing
Property, the portion of the Downpayment allocable to such Property (or Ground
Lease), as set forth in Section 2.1(b), shall be reallocated equally among the
remaining portion of the Group A Portfolio, and the balance of the Group A
Portfolio shall remain unaffected. In the event that a title company designated
by Seller and licensed to do business in New York is willing to issue title
insurance to Purchaser in satisfaction of the requirements of this Section,
Seller shall not be deemed unable to eliminate all Unacceptable Encumbrances not
waived by Purchaser, or unable to arrange for title insurance insuring against
enforcement of such Unacceptable Encumbrances against, or collection of the same
out of, the applicable Property (or Ground Lease), and Purchaser shall be
obligated to proceed with the Closing contemplated hereunder as if such
objection did not exist.

                  6.2 Notwithstanding anything to the contrary set forth in this
Section 6 or elsewhere in this Agreement, Seller shall not be obligated to bring
any action or proceeding, to make any payments or otherwise to incur any expense
in order to eliminate Unacceptable Encumbrances not waived by Purchaser or to
arrange for title insurance insuring against enforcement of such Unacceptable
Encumbrances against, or collection of the same out of, the applicable Property
(or Yonkers Property); provided, however, that Seller shall satisfy or discharge
mortgages, real estate taxes and assessments secured by or affecting the
applicable Property (or Ground Lease) regardless of amount; and Seller shall
satisfy or discharge judgments


                                       11
<PAGE>

against Seller, administrative or other liens (collectively, "Liens") secured by
or affecting the applicable Property (or Ground Lease) which can be satisfied by
payment of readily ascertainable amounts not to exceed, in the aggregate for all
such Liens, three percent (3%) of the Purchase Price set forth in Section 2.1
for the applicable Property (the "Cap"). Notwithstanding the foregoing, in the
event that Seller fails to satisfy or discharge all mortgages, real estate taxes
and assessments secured by or affecting the applicable Property (or Ground
Lease) as aforesaid, then Purchaser shall receive a credit against the Purchase
Price in the amount of all of such unsatisfied mortgages, real estate taxes and
assessments and shall take title to the affected Property (or Ground Lease)
subject to such mortgages, real estate taxes and assessments. In the event that
the cost of discharging or satisfying the Liens at a particular Property (or
Ground Lease) exceeds the Cap, Purchaser shall have the right to either (a)
waive the Liens as an Unacceptable Encumbrance and close on the applicable
Property (or Ground Lease), in which event Seller shall be obligated to credit
Purchaser at Closing with an amount equal to the Cap; or (b) exclude the
affected Property (or Ground Lease) from the scope of this Agreement (an
"Excluded Property"), in which event such Property (or Ground Lease) shall not
be subject to the provisions of Section 9.3 (except as expressly provided in
Section 9.5), the portion of the Downpayment allocable to such Property (or
Ground Lease), as set forth in Section 2.1(b), shall be reallocated equally
among the remaining portion of the Group A Portfolio, the Purchase Price payable
at the Closing shall be reduced by the amount set forth in Section 2.1(b) for
such Excluded Property, and the balance of the Group A Portfolio shall remain
unaffected. Without limiting the generality of the preceding provisions of this
Section 6.2, for the purposes of this Agreement (including Sections 6.1 and
16.1), Seller's failure or refusal to bring any action or proceeding, to make
any payments or to otherwise incur any expense (except for Seller's obligation
to satisfy mortgages, real estate taxes, assessments, regardless of amount, and
Liens which, in the aggregate, can be satisfied by payment of readily
ascertainable amounts not to exceed the Cap) in order to eliminate Unacceptable
Encumbrances not waived by Purchaser or to arrange for such title insurance
shall be deemed an inability of Seller to eliminate such Unacceptable
Encumbrances or to arrange for such title insurance and shall not be a default
by Seller hereunder (willful or otherwise).

                  6.3 If on the Closing Date there may be any Liens or other
encumbrances which Seller must pay or discharge in order to convey to Purchaser
such title as is herein provided to be conveyed, Seller may use any portion of
the Purchase Price to satisfy the same, provided:

                           (a) Seller shall deliver to Purchaser or the Title
Company, at the Closing, instruments in recordable form and sufficient to
satisfy such Liens or other encumbrances of record together with the cost of
recording or filing said instruments; or

                           (b) Seller, having made arrangements with the Title
Company, shall deposit with said company sufficient monies acceptable to said
company to insure the obtaining and the recording of such satisfactions.

The existence of any such Liens or other encumbrances shall not be deemed
objections to title if Seller shall comply with the foregoing requirements.


                                       12
<PAGE>

                  6.4 Intentionally Deleted.

                  6.5 If on the Closing Date there shall be conditional bills of
sale, chattel mortgages or security interests filed against any of the
Properties or the Ground Lease, the same shall not constitute objections to
title, provided (a) Seller executes and delivers an affidavit to the effect
either (i) that the personal property covered by said conditional bills of sale,
chattel mortgages, or security interests is no longer in or on such Property or
the Ground Lease, or (ii) if such personal property is still in or on such
Property or the Ground Lease, that it has been fully paid for, or (iii) that
such personal property is the property of a Tenant of such Property or the
Ground Lease; and (b) the Title Company commits to either omit or insure over
any such items from the policy to be issued to Purchaser at Closing.

                  6.6 Any franchise or corporate tax open, levied or imposed
against any Seller or other owners in the chain of title that may be a Lien on
the Closing Date, shall not be an objection to title if the Title Company omits
same from the title policy(ies) issued pursuant to the Commitment(s) or excepts
same but insures Purchaser against collection thereof out of the applicable
Property.

                  6.7 If a search of title discloses judgments, bankruptcies or
other returns against other persons or entities having names the same as or
similar to that of Seller, Seller will deliver to Purchaser and the Title
Company an affidavit stating that such judgments, bankruptcies or other returns
are not against Seller, whereupon, provided the Title Company omits such returns
as exceptions to title or provides affirmative coverage with respect thereto,
such returns shall not be deemed an objection to title.

         Section 7 Representations and Warranties

                  7.1 (a) Each Seller represents and warrants to Purchaser as
follows:

                           (i) Such Seller is a duly formed and validly existing
entity organized under the laws of the state of its formation set forth on the
first page hereof, and is qualified under the laws of the state in which the
Property (or Ground Lease) it is selling (or assigning) is located, other than
in such jurisdictions where the failure to be so qualified or licensed,
individually or in the aggregate would not have a material adverse effect on the
Group A Portfolio.

                           (ii) Such Seller has the full legal right, power and
authority to execute and deliver this Agreement and all documents now or
hereafter to be executed by such Seller pursuant to this Agreement
(collectively, "Seller's Documents"), to consummate the transaction contemplated
hereby, and to perform its obligations hereunder and under Seller's Documents.

                           (iii) This Agreement and Seller's Documents do not
and will not contravene any provision of the [certificate of formation and the
partnership agreement] [articles of organization and operating agreement] of
such Seller, any judgment, order, decree, writ or injunction issued against such
Seller, or any provision of any laws or governmental ordinances,


                                       13
<PAGE>

rules, regulations, orders or requirements (collectively, "Laws") applicable to
such Seller, except to the extent that such contravention would not reasonably
be expected to have a material adverse effect upon the Group A Portfolio and/or
the business, properties, assets, financial condition, or results of operations
of Sellers and their subsidiaries, taken as a whole, including the ability of
Sellers to consummate the transactions contemplated herein (including, without
limitation, the sale of the Group A Portfolio to Purchaser). The consummation of
the transactions contemplated hereby will not result in a breach or constitute a
default or event of default by such Seller under any agreement to which such
Seller or any of its assets are subject or bound and will not result in a
violation of any Laws applicable to such Seller. Neither the execution and
delivery of this Agreement nor the consummation of the transactions herein
contemplated will conflict with, result in a breach of or constitute a default
under, or otherwise adversely affect any Lease, the REA, or any other contract,
agreement, instrument, license or undertaking to which Seller or any of its
affiliates is a party or by which any of them or any of their respective
properties or assets is or may be bound or that relates to the Property (or
Ground Lease) in any respect.

                           (iv) There are no leases, licenses or other occupancy
agreements affecting any portion of its Property (or Ground Lease)(collectively,
the "Leases") on the date hereof except for the Leases listed in the rent roll
annexed hereto as Schedule 7.1(a)(iv) and made a part hereof. The Leases
described in Schedule 7.1(a)(iv) comprise all the Leases presently existing and
each is in full force and effect; no Lease has been modified or supplemented in
any material respect except (if at all) as set forth on Schedule 7.1(a)(iv);
except as set forth on Schedule 7.1(a)(iv), no Base Rent has been paid more than
one month in advance by any tenant, and no tenant is entitled to any "free rent"
period, defense, credit, allowance or offset against Base Rent; the information
set forth in Schedule 7.1(a)(iv) is true, correct and complete in all material
respects. To Seller's knowledge, there is no material default of either landlord
or tenant under any of the Leases, except as set forth on Schedule 7.1(a)(iv).
There are no persons or entities entitled to possession of the Property other
than those listed on Schedule 7.1(a)(iv). Except as set forth on Schedule
7.1(a)(iv), no work or installations is required of Seller except as specified
(if at all) in the Leases, and in any case Seller has fully completed all tenant
improvements specified in any Lease to be the responsibility of the landlord and
has paid all tenant construction allowances. Seller has no obligations with
respect to contributing for or paying dues or charges to a Shopping Center
merchant's association or marketing fund.

                           (v) There are no pending actions, suits, proceedings
or, to Seller's knowledge, investigations to which such Seller is a party before
any court or other governmental authority with respect to its Property (or
Ground Lease) other than personal injury and other routine tort litigation
arising from the ordinary course of operations of Seller (x) which are covered
by adequate insurance; (y) for which all material costs and liabilities arising
therefrom are reimbursable pursuant to common area maintenance or similar
agreements; or (z) which would not adversely affect or be binding upon Purchaser
or the Property (or Ground Lease) following Closing.

                           (vi) Such Seller has obtained, or will have obtained
by the Closing, all consents required to permit all of the transactions
contemplated by this Agreement (including but not limited to the sale of the
applicable Property (and Ground Lease) to Purchaser) and required


                                       14
<PAGE>

under any partnership agreement, shareholder agreement, limited liability
company agreement, covenant or other agreement concerning it or to which it (or
any of its partners, members or shareholders) is a party or by any Law, and the
sale of the Property (and the Ground Lease) and the Group A Portfolio does not
require the consent or approval of any public or private authority which has not
already been obtained by Seller, or, if required, it will be obtained by Seller
prior to the Closing of the sale and purchase of the Group A Portfolio. The
transactions contemplated under this Agreement have been approved by the Board
of Directors of Seller and Philips International Realty Corp.

                           (vii) To Yonkers' knowledge, the Ground Lease is in
full force and effect, a true and complete copy of the Ground Lease is attached
as Exhibit "A" to the Ground Lease Assignment (as defined below), the Base Rent
(including all CPI increases) under the Ground Lease as of the date hereof is
$245,899.62 per year, the building has not been enlarged beyond what is
reflected in the Ground Lease such that the rent has not increased beyond the
amount set forth in the Ground Lease, the Ground Lease has not been amended
except as set forth herein, and Yonkers has not received a notice of default
from the Ground Lessor claiming that any breach has occurred thereunder.
[Yonkers only]

                           (viii) Seller has not received notice from any
governmental authority, mortgagee, tenant or insurer (i) that either the
Property (or Ground Lease) or the use or operation thereof is currently in
violation of any zoning, environmental or other land use regulations in any
material respect, and to Seller's knowledge no such notice has been issued; or
(ii) asserting that Seller is required to perform work at the Property (or the
Yonkers Property) and to Seller's knowledge no such notice has been issued. If
Seller receives such a notice or a violation is issued or filed prior to
Closing, Seller shall promptly notify Purchaser. In the event that cure of such
violation would require an alteration of or addition to the Property (or Yonkers
Property) or Personal Property (or Yonkers Personal Property) or otherwise
require an expenditure to cure the violation, the cost of which would exceed two
(2%) percent of the Purchase Price allocable to such Property (or Ground Lease),
then Purchaser shall have the right to either (a) waive the violations and close
on the applicable Property (or Ground Lease), in which event Seller shall be
obligated to credit Purchaser at Closing with an amount equal to two (2%)
percent of the Purchase Price allocable to such Property (or Ground Lease); or
(b) exclude the affected Property (or Ground Lease) from the scope of this
Agreement (an "Excluded Property"), in which event such Excluded Property shall
not be subject to the provisions of Section 9.3 (except as expressly provided in
Section 9.5), the portion of the Downpayment allocable to such Property (or
Ground Lease), as set forth in Section 2.1(b), shall be reallocated equally
among the remaining portion of the Group A Portfolio, the Purchase Price payable
at the Closing shall be reduced by the amount set forth in Section 2.1(b) for
such Excluded Property, and the balance of the Group A Portfolio shall remain
unaffected. Notwithstanding the foregoing, (x) Seller shall have no obligation
to satisfy or discharge or otherwise cure any violations first arising after the
execution and delivery of this Agreement; and (y) Seller shall have the right to
contest any violation filed or recorded prior to the date hereof if the same
does not delay the Closing and if the violation is cured or removed prior to the
Closing.


                                       15
<PAGE>

                           (ix) There are not now and will not be on the date of
Closing any agreements or understandings relating to the Property (or Ground
Lease), except for the Permitted Encumbrances, Leases and service contracts
relating to the operation of the Property (or Ground Lease), all of which
service contracts shall be terminated by Seller prior to the Closing Date; and
no material alterations, amendments or waivers pertaining to the foregoing will
be made by Seller except with Purchaser's written approval prior to the date of
Closing, not to be unreasonably withheld or delayed.

                           (x) There are no on-site employees or hired persons
in connection with the management, operation or maintenance of the Property (or
Ground Lease) for whom Purchaser shall be responsible. Purchaser shall have no
obligation, liability or responsibility with respect to charges, salaries,
vacation pay, fringe benefits or like items subsequent to Closing, nor with
respect to any management or employment agreements with respect to the Property.

                           (xi) No Tenant (or REA Party) has any option, right
of first refusal or other right to purchase the Property (or Ground Lease) or
any part thereof or interest therein. In the event any such option, right of
first refusal or other right to purchase does exist on the date hereof, Seller
shall at Closing deliver to Purchaser a written and recordable instrument,
signed by the holder thereof, irrevocably and unconditionally waiving,
canceling, terminating and annulling any such option, right of first refusal or
other right.

                           (xii) All construction and/or maintenance work
required to be completed prior to the Closing Date by the terms of any Lease or
REA or other Permitted Encumbrances has been satisfactorily completed.

                           (xiii) To the knowledge of Glen Cove, SCF and Lake
Mary, the REAs are in full force and effect and have not been modified or
supplemented except as set forth in a recorded instrument. To the knowledge of
Glen Cove, SCF and Lake Mary, there is no material default under the REAs of
either Seller or any REA Parties. To the knowledge of Glen Cove, SCF and Lake
Mary, no unperformed work or installations or unpaid amounts are required of or
due from Seller under the REAs. [Glen Cove, SCF and Lake Mary only]

                           (xiv) True and complete copies of the Property Notes
and the Mortgages (as such terms are hereinafter defined in Section 18 hereof)
set forth in Section 18 have been delivered to or made available to Purchaser.
With regard to the Property Notes and Mortgages: (A) True, correct and complete
copies of same, and of all other Mortgage Loan Documents (as defined below),
have heretofore been delivered to Purchaser; (B) Seller has not received any
notice of default from the Mortgagee (or its servicing agent, if any) claiming
that any material breach has occurred pursuant to the terms of the Property
Notes or Mortgages or any other Loan Document which remains uncured; (C) the
approximate amount currently outstanding for the Munsey Loan (as defined below)
is $12,571,433.00; and (D) the approximate amount currently outstanding for the
Henry Loan (as defined below) is $3,788,979.00.

                           (xv) Except as set forth on Schedule 7.1(a)(xv)
hereto, there are no tax certiorari proceedings currently pending with respect
to any Property (or Ground Lease); and no


                                       16
<PAGE>

Tenant entitled to a refund for a year prior to the Closing in connection with a
closed tax certiorari proceeding has not received the refund to which it is
entitled pursuant to its Lease.

                           (xvi) To the knowledge of SCF, as of the date of this
Agreement, no event has occurred which would entitle SCF to exercise its right
of first refusal with respect to the purchase of that certain parcel of land
adjacent to the Key Largo Property, which parcel is currently owned by Monroe
County, Florida and used as a public library.

                           (xvii) Intentionally Deleted.

                           (xviii) All of the real property subject to that
certain cross-easement agreement, dated [as of January 1, 1977, and recorded on
March 1, 1979, at Liber 9174, Pg. 571,] in the Office of the County Clerk of
Nassau County, New York, between J. Alan Ornstein, et al. and Bonwit Teller is
part of the Munsey Park Property. [Munsey Park only]

                           (xix) Except for the real estate tax, insurance, and
repair/maintenance escrows, there are no escrows still in existence in
connection with the Munsey Debt (as defined below), and the current balances of
the existing escrows are as follows: $281,194.00; $14,834.00; and $5,010.00
respectively [Munsey Park only]

                           (xx) Except for the capital improvement escrow, there
are no escrows still in existence in connection with the Henry Debt (as defined
below), and the current balances of the existing escrow is as follows:
$1,577.00. [Henry Street only]

                           (b) At Closing, Seller shall deliver to Purchaser a
certificate reconfirming all the foregoing representations as true, correct and
complete in all material respects as of the date of Closing (except as they
relate only to an earlier date), or, if there have been any changes, a
description thereof; provided, however, that such a description shall not
operate to cure a material breach of such representations.

                           (c) Copies of the Leases in each Seller's possession
and certain other Property Information have been or will be delivered or
otherwise made available to Purchaser and Purchaser has undertaken its own
Investigations (as defined below) and, by accepting the Deeds and the Ground
Lease Assignment, Purchaser acknowledges its receipt and acceptance or the
availability to it thereof and that Purchaser has reviewed the same to its
satisfaction. To the extent that any information (i) contained in the copies of
the Leases or any other Property Information furnished to or made available to
Purchaser by Seller; (ii) contained in reports provided to Purchaser from
professionals); (iii) contained in Seller's filings with the Securities and
Exchange Commission or other publicly available documents; (iv) obtained by
Purchaser prior to the expiration of the Inspection Period through oral or
written communications with Seller's employees (provided that the
representations and warranties contained in Section 7.1(a)(vi) shall not be
subject to modification thereby) or tenants; or (v) subject to the Seller's
obligation to deliver Estoppel Certificates in compliance with Section 10.1(n),
obtained by Purchaser following the expiration of the Inspection Period through
oral or written communications with Seller's tenants, is inconsistent with the
foregoing representations and


                                       17
<PAGE>

warranties, such representations and warranties shall be deemed modified to the
extent necessary to eliminate such inconsistency and to conform such
representations and warranties to such information. Purchaser hereby agrees to
diligently and in good faith proceed to communicate with Seller's employees and
those expressly named Tenants set forth on Schedule 10.1(n) hereto prior to the
expiration of the Inspection Period. As used in this Agreement, the words
"Seller's knowledge" or words of similar import shall be deemed to mean, and
shall be limited to, the actual (as distinguished from implied, imputed or
constructive) knowledge of Seller after, and based solely upon, making inquiry
of Louis J. Petra, the person charged with the management responsibility for the
Group A Portfolio.

                           (d) (i) Subject at all times to Section 7.1(c), if at
or prior to the Closing, (i) Purchaser shall become aware (whether through its
own efforts, by notice from Seller or otherwise) that any of the representations
or warranties made herein by Seller are untrue, inaccurate or incorrect in any
material respect and shall give Seller notice thereof at or prior to the
Closing, or (ii) Seller shall notify Purchaser that a representation or warranty
made herein by Seller is untrue, inaccurate or incorrect in any material
respect, then Seller may, in its sole discretion, elect by notice to Purchaser
to adjourn the Closing one or more times for up to thirty (30) days in the
aggregate in order to cure or correct such materially untrue, inaccurate or
incorrect representation or warranty. If Purchaser shall become aware (whether
through its own Investigations, by notice from Seller or otherwise) that any of
the representations or warranties made herein by Seller are untrue, inaccurate
or incorrect in any material respect and shall fail to give Seller notice
thereof at or prior to the Closing, or if any such representation or warranty is
untrue, inaccurate or incorrect in any non-material respect, and is not cured or
corrected by Seller on or before the Closing Date (whether or not the Closing is
adjourned as provided above), Purchaser shall nevertheless be deemed to, and
shall, waive such untrue, inaccurate or incorrect misrepresentation or breach of
warranty and shall consummate the transactions contemplated hereby without any
reduction of or credit against the Purchase Price.

                           (ii) If any such representation or warranty is
untrue, inaccurate or incorrect in any material respect, and is not cured or
corrected by Seller on or before the Closing Date (whether or not the Closing is
adjourned as provided above), then Purchaser, as its sole remedy for any and all
such materially untrue, inaccurate or incorrect representations or warranties,
shall have the right to elect either (A) to waive such materially untrue,
inaccurate or incorrect representations or warranties, close on the affected
Property (or Ground Lease) and the balance of the Group A Portfolio for which
the closing conditions have been met, and receive no credit against, or
reduction of, the Purchase Price due to such materially untrue, inaccurate or
incorrect representations or warranties; and/or (B) to postpone the closing for
the affected Property (or Ground Lease) (each, a "Post-Closing Property"), such
that the affected Property (or Ground Lease) shall be subject to the provisions
of Section 9.3, the portion of the Downpayment allocable to such Property (or
Ground Lease), as set forth in Section 2.1(b), shall be reallocated equally
among the remaining portion of the Group A Portfolio, the Purchase Price payable
at the Closing shall be reduced by the amount set forth in Section 2.1(b) for
such Post-Closing Property, and, subject to Section 9.3, the balance of the
Group A Portfolio shall remain unaffected; or (C) solely in the event that the
uncured materially untrue, inaccurate or incorrect representations or warranties
are those set forth in Section 7.1(a)(vi), and the Title Company is


                                       18
<PAGE>

unwilling to issue title insurance to Purchaser in accordance with the terms of
this Agreement, to terminate this Agreement (subject to the terms of this
Agreement, including, without limitation, Section 6.1(b)), in which event
Purchaser shall receive upon such termination, in addition to the return of the
Downpayment (together with all interest accrued thereon, if any) and any amounts
to which the Group B Purchaser is expressly entitled under the Group B
Agreement, a break up fee in the amount of $2,078,583.52 (the "Break Up Fee"),
subject to Section 16.3, as liquidated damages and as agreed compensation for
Purchaser's lost opportunity and expenses, and not as a penalty.

                           (iii) Purchaser acknowledges and agrees that (x) at
or prior to the Closing, Purchaser's rights and remedies in the event any of
Seller's representations or warranties made in this Agreement are untrue,
inaccurate or incorrect shall be only as provided in this Section 7.1(d), and
(y) if the Closing does not occur, or Purchaser waives such materially untrue,
inaccurate or incorrect representations or warranties and closes on the affected
Property (or Ground Lease), Purchaser hereby expressly waives, relinquishes and
releases all other rights or remedies available to it at law, in equity or
otherwise (including, without limitation, the right to seek damages from Seller)
as a result of any of Seller's representations or warranties made in this
Agreement being untrue, inaccurate or incorrect. For the purposes of this
Section 7, a representation shall be deemed to be materially untrue, inaccurate
or incorrect if, as a result of such untruth, inaccuracy or incorrectness, there
is a material, adverse affect upon the Property (or Ground Lease) and/or the
business, properties, assets, financial condition, or results of operations of
the applicable Seller and its subsidiaries, taken as a whole, including, without
limitation, the ability of such Seller to consummate the transactions
contemplated herein (including, without limitation, the sale of such Property
(or Ground Lease) to Purchaser).

                      (e) Intentionally Deleted.

                      (f) In the event the Closing occurs:

                           (i) Notwithstanding anything to the contrary
contained in Section 7.1(a) or elsewhere in this Agreement to the contrary,
except as expressly set forth in Section 7.1(a)(f)(ii) or elsewhere in this
Agreement, Purchaser expressly waives, relinquishes and releases any right or
remedy available to it at law, in equity or under this Agreement to make a claim
against Seller for damages that Purchaser may incur, or to rescind this
Agreement and the transactions contemplated hereby, as the result of any of
Seller's representations or warranties being materially untrue, inaccurate or
incorrect; and

                           (ii) the representations and warranties of Seller set
forth in Section 7.1(a) and elsewhere in this Agreement shall survive the
Closing and the execution and delivery of the Deed (or Ground Lease Assignment)
until December 31, 2000, and shall be subject to Section 24.5. Notwithstanding
the foregoing, to the extent that (A) a Tenant shall certify in its estoppel
confirming any matter set forth in Sections 7.1(a)(iv) and (xi), (xii); (B) the
landlord under the Ground Lease shall certify in its estoppel confirming any
matter set forth in Section 7.1(a)(vii); (C) a Mortgagee shall certify in its
consent confirming any matter set forth in Sections 7.1(a)(xiv), (xix) or (xx);
(D) an REA Party shall certify in its estoppel confirming any matter set forth
in Section 7.1(a)(xi), (xii) or (xiii); (E) the Glen Cove Community Development
Association shall certify in its estoppel confirming any


                                       19
<PAGE>

matter set forth in Sections 7.1(a)(xvi) or (xvii), then Seller's
representations and warranties as to such matters shall terminate. The
provisions of this Section 7.1(f) shall survive the Closing and the execution
and delivery of the Deed (or Ground Lease Assignment).

                  7.2 (a) Purchaser represents and warrants to Seller as
follows:

                           (i) Purchaser is a duly formed and validly existing
limited partnership organized under the laws of the State of Delaware, and is
qualified under the laws of the State of Delaware to conduct business therein on
the Closing Date.

                           (ii) Purchaser has the full legal right, power,
authority and financial ability to execute and deliver this Agreement and all
documents now or hereafter to be executed by it pursuant to this Agreement
(collectively, the "Purchaser's Documents"), to consummate the transactions
contemplated hereby, and to perform its obligations hereunder and under
Purchaser's Documents.

                           (iii) This Agreement and Purchaser's Documents do not
and will not contravene any provision of the partnership agreement or
certificate of formation of Purchaser, any judgment, order, decree, writ or
injunction issued against Purchaser, or any provision of any Laws applicable to
Purchaser. The consummation of the transactions contemplated hereby will not
result in a breach or constitute a default or event of default by Purchaser
under any agreement to which Purchaser or any of its assets are subject or bound
and will not result in a violation of any Laws applicable to Purchaser.

                           (iv) There are no pending actions, suits, proceedings
or investigations to which Purchaser is a party before any court or other
governmental authority which may have a material adverse impact on the
transactions contemplated hereby.

                           (v) Purchaser has, or by the Closing will have,
obtained all consents (including without limitation the consents of Kimco Realty
Corporation. and The New York Common Fund) required to permit all of the
transactions contemplated by this Agreement and required under any partnership
agreement, covenant or other agreement concerning it or to which it (or any of
its partners) is a party or by any Law, and the purchase of the Property (and
the Ground Lease) and the Group A Portfolio does not require the consent or
approval of any public or private authority which has not already been obtained
by Purchaser, or, if required, it will be obtained by Purchaser prior to the
Closing of the sale and purchase of the Group A Portfolio.

                  (b) At Closing, Purchaser shall deliver to Seller a
certificate reconfirming all the foregoing representations as true, correct and
complete in all material respects as of the date of Closing (except as they
relate only to an earlier date), or, if there have been any changes, a
description thereof; provided, however, that such a description shall not
operate to cure a material breach of such representations. In the event the
Closing occurs, the representations and warranties of Purchaser set forth in
Section 7.2(a) and elsewhere in this Agreement shall be true,


                                       20
<PAGE>

accurate and correct in all material respects upon the execution of this
Agreement, shall be deemed to be repeated on and as of the Closing Date (except
as they relate only to an earlier date), and shall survive the Closing and the
execution and delivery of the Deed (or Ground Lease Assignment) until December
31, 2000, and no action or claim based thereon shall be commenced after December
31, 2000.

         Section 8. Costs of Transaction

                  Seller shall be responsible for any transfer, conveyance,
deed, recording or documentary stamp taxes or fees, or similar taxes or charges
imposed by the states and/or municipalities where each Property (and the Ground
Lease) is located in connection with the transfer of such Property (and the
Ground Lease) to Purchaser. Purchaser shall be responsible for (a) Purchaser's
fee title insurance premiums and, with respect to any mortgage loans assigned to
Purchaser's lender, mortgagee's title insurance premiums, fees and expenses and
the cost of customary affirmative insurance and endorsements for the state in
which the applicable Property (and the Ground Lease) is located as required
herein; (b) engineering, survey, inspection, preparation of due diligence
reports and other due diligence expenses; and (c) recording fees (exclusive of
transfer taxes). All other costs and expenses in connection with the
transactions contemplated herein, subject to the following sentence, shall be
paid by the party that, in accordance with local custom for each Property (and
the Ground Lease), typically pays same, except as otherwise set forth in Section
18 hereof. Each party shall pay its own legal fees and travel and lodging
expenses in connection with the transaction contemplated herein. In the event
that any party fails to pay the Closing costs for which it is responsible, the
other party(ies) may elect, in their sole discretion, to pay such sums and
receive a credit at the Closing.

         Section 9. Conditions Precedent to Closing

                  9.1 Purchaser's obligation under this Agreement to purchase
the Group A Portfolio is subject to the fulfillment of each of the following
conditions, subject, however, to the provisions of Section 9.3.

                      (a) The representations and warranties of Seller contained
herein shall be materially true, accurate and correct as of the Closing Date
except to the extent they relate only to an earlier date (subject to the
provisions of Sections 7.1(c) and (d));

                      (b) Seller shall be ready, willing and able to deliver fee
title to the Group A Portfolio (except in the case of the Yonkers property, in
which case Yonkers shall be ready, willing and able to assign its right, title
and interest in the Ground Lease) in accordance with the terms and conditions of
this Agreement, including, without limitation, the condition that the Title
Company shall be prepared to issue at Closing (or prepared to unconditionally
commit to issue at Closing, with no "gap") its title policy in the form required
by Section 6; and

                      (c) Seller shall have delivered all the documents and
other items required pursuant to Section 10, and shall have performed all other
covenants, undertakings


                                       21
<PAGE>

and obligations, and complied with all conditions required by this Agreement to
be performed or complied with by the Seller at or prior to the Closing.

                  9.2 Seller's obligation under this Agreement to sell the Group
A Portfolio to Purchaser is subject to the fulfillment of each of the following
conditions, subject, however to the provisions of Sections 9.3 and 9.4:

                      (a) the representations and warranties of Purchaser
contained in Section 7.2 shall be materially true, accurate and correct as of
the Closing Date;

                      (b) Purchaser shall have delivered to Seller the funds
required hereunder;

                      (c) Purchaser shall have delivered to Seller all the
documents to be executed by Purchaser set forth in Section 11;

                      (d) all consents and approvals of governmental authorities
and parties to agreements to which Purchaser is a party or by which Purchaser's
assets are bound that are required with respect to the consummation of the
transactions contemplated by this Agreement shall have been obtained and copies
thereof shall have been delivered to Seller at or prior to the Closing;

                      (e) on or prior to Closing Date, (i) Purchaser shall not
have applied for or consented to the appointment of a receiver, trustee or
liquidator for itself or any of its assets unless the same shall have been
discharged prior to the Closing Date, and no such receiver, liquidator or
trustee shall have otherwise been appointed, unless same shall have been
discharged prior to the Closing Date, (ii) Purchaser shall not have admitted in
writing an inability to pay its debts as they mature, (iii) Purchaser shall not
have made a general assignment for the benefit of creditors, (iv) Purchaser
shall not have been adjudicated a bankrupt or insolvent, or had a petition for
reorganization granted with respect to Purchaser, (v) Purchaser shall not have
filed a voluntary petition seeking reorganization or an arrangement with
creditors or taken advantage of any bankruptcy, reorganization, insolvency,
readjustment or debt, dissolution or liquidation law or statute, or filed an
answer admitting the material allegations of a petition filed against it in any
proceedings under any such law, or had any petition filed against it in any
proceeding under any of the foregoing laws unless the same shall have been
dismissed, canceled or terminated prior to the Closing Date.

                      (f) Purchaser shall have executed and delivered the Group
B Agreement (as defined below) and shall have completed its due diligence, such
that it is contractually obligated to purchase the Group B Properties (as
defined below) subject to the terms and conditions of the Group B Agreement.

                  9.3 (a) In the event that any condition contained in Section
9.1, on or prior to the expiration of sixty (60) days following the execution
and delivery of this Agreement (the "Closing Period"), is not satisfied
regarding either (i) only one Property (or the Ground Lease), or


                                       22
<PAGE>

(ii) two or more Properties (or any Property and the Ground Lease), whose
aggregate allocable share of the Purchase Price does not exceed $20,000,000.00,
then the Closing Period shall be deemed extended for thirty (30) days (the
"Extended Closing Period"), during which time Seller shall continue to use
diligent, good faith efforts to satisfy such unmet closing conditions.
Notwithstanding the extension of the Closing Period, Purchaser shall have the
right to elect to (x) waive such unsatisfied condition whereupon title shall
close as provided in this Agreement at the end of the Closing Period, or (y)
close on that portion of the Group A Portfolio for which all closing conditions
have been met and postpone the closing for the affected Property (or Ground
Lease) until the expiration of the Extended Closing Period, or (z) postpone the
Closing on the entire Group A Portfolio until the expiration of the Extended
Closing Period. In the event that said unmet closing conditions remain unmet at
the end of the Extended Closing Period, Purchaser shall close on that portion of
the Group A Portfolio for which all closing conditions have been met, and the
closing of the Property (or Ground Lease)(each, a "Post-Closing Property") for
which closing conditions remain unmet shall be further postponed such that the
Post-Closing Property shall be subject to the following provisions of this
Section 9.3, the portion of the Downpayment allocable to such Property (or
Ground Lease), as set forth in Section 2.1(b), shall be reallocated equally
among the remaining portion of the Group A Portfolio, and the Purchase Price
payable at the Closing shall be reduced by the amount set forth in Section
2.1(b) for such Post-Closing Property.

                      (b) (i) In the event that any closing condition contained
in Section 9.1, on or prior to the expiration of the Closing Period, is not
satisfied regarding two or more Properties (or a Property and the Ground Lease)
whose aggregate allocable share of the Purchase Price exceeds $20,000,000.00,
then the Closing Period shall be deemed extended for thirty (30) days, during
which time Seller shall continue to use diligent, good faith efforts to satisfy
such unmet closing conditions. Notwithstanding the Extended Closing Period,
Purchaser shall have the right to elect to (i) waive such unsatisfied condition
whereupon title shall close as provided in this Agreement at the end of the
Closing Period, or (ii) close on that portion of the Group A Portfolio for which
all closing conditions have been met and postpone the closing for the affected
Properties (and/or Ground Lease) for said thirty (30) day period, or (iii)
postpone the Closing on the entire Group A Portfolio until the expiration of the
Extended Closing Period.

                           (ii) In the event that said unmet closing conditions
remain unmet at the end of the Extended Closing Period, then Seller shall have
the right to elect to (x) terminate this Agreement with respect to any unclosed
portion of the Group A Portfolio, in which event Purchaser shall receive upon
such termination, in addition to the return of the Downpayment (together with
all interest accrued thereon) and any amounts to which the Group B Purchaser is
expressly entitled under the Group B Agreement, the Break Up Fee, subject to
Section 16.3, as liquidated damages and as agreed compensation for Purchaser's
lost opportunity and expenses, and not as a penalty; or (y) offer to postpone
the closing for the Property(ies) (and/or Ground Lease) for which the closing
condition(s) have NOT been met (collectively, the "Post-Closing Properties"),
subject to Section 9.3(c), and close on those Property(ies) (and/or Ground
Lease) for which the closing conditions have been met, by delivery of written
notice to Purchaser.


                                       23
<PAGE>

                           (iii) Within five (5) business days of its receipt of
Seller's offer pursuant to option (y) above, Purchaser shall elect to either (i)
terminate this Agreement with respect to any unclosed portion of the Group A
Portfolio, in which event this Agreement shall be terminated, Purchaser shall be
entitled to the return of any portion of the Downpayment (together with the
interest earned thereon) not previously applied at a Closing, but shall NOT be
entitled to receive the Break Up Fee, and neither party shall have any further
rights, obligations or liabilities hereunder, except for the Surviving
Obligations; or (ii) close on those Properties (and/or Ground Lease) for which
the closing conditions have been met, as provided for in this Agreement, and
postpone the closing of the portion of the Group A Portfolio for which any
closing conditions have not been met (the "Post-Closing Properties") for a
period of six (6) months (the "Cure Period"), in which event the Purchase Price
payable at Closing shall be reduced by the aggregate amounts set forth in
Section 2.1(b) for any Post-Closing Properties, the portion of the Downpayment
allocable to such Property (or Ground Lease), as set forth in Section 2.1(b),
shall be reallocated equally among the remaining portion of the Group A
Portfolio, and Purchaser shall NOT be entitled to receive the Break Up Fee.

                           (iv) The parties hereto agree that the Break Up Fee
shall be subject to reduction, in the event that Purchaser closes on any portion
of the Group A Portfolio, by an amount equal to four (4.0%) percent of the
difference between (i) the aggregate Purchase Price of such Property (or Ground
Lease) set forth in Section 2.1(b), and (ii) the aggregate then outstanding debt
on such closed Property (or Ground Lease) which is assumed by Purchaser.

                      (c) Notwithstanding anything to the contrary contained
herein, the following provisions shall be applicable to Post-Closing Properties:

                           (i) subject to the provisions of subsection
9.3(c)(iii) hereof, for a period of six (6) months (the "Cure Period") following
the Closing Date, Seller may not sell (or enter into an agreement to sell) a
Post-Closing Property to any party other than Purchaser, Seller shall continue
to use diligent good faith efforts to meet all closing conditions which caused
the closing of such Post-Closing Property to be postponed, and Seller shall keep
Purchaser fully informed as to the status and progress of meeting such failed
closing conditions.

                           (ii) Purchaser shall have the right (but not the
obligation) to close on any Post-Closing Property (on the same terms and
conditions set forth in this Agreement, including the Purchase Price allocable
thereto) during the Cure Period (including, at Purchaser's sole discretion, by
waiving any failed closing conditions), by delivery of not less than ten (10)
days prior written notice to Seller, in which event the closing therefor shall
be held within fifteen (15) days (time being of the essence) following Seller's
receipt of such election notice. If Purchaser fails to close on such Post
Closing Property after delivering said notice, then Seller shall be free to sell
that Post Closing Property and all other Post Closing Properties to third
parties without claim or liability to Purchaser.

                           (iii) If at any time during the Cure Period Seller
meets all failed closing conditions for a Post-Closing Property and so notifies
Purchaser in writing, Purchaser shall have ten (10) days (time being of the
essence) to elect to close on such Post-Closing Property by


                                       24
<PAGE>

delivery of written notice to Seller. Purchaser's failure to make such election
within said ten (10) day period shall be deemed an election NOT to close on such
Post-Closing Property, and Seller shall be free to sell such Post-Closing
Property to any third party, without any claim by or liability to Purchaser. In
the event that Purchaser elects to close on such Post-Closing Property, the
closing therefor shall be held within fifteen (15) days (time being of the
essence) following Seller's receipt of such election notice.

                      (d) In the event that any closing conditions for any
Post-Closing Properties remain unmet at the end of the Cure Period, despite
Seller's diligent good faith efforts to fully satisfy same, then Purchaser shall
elect to either (i) close (at the end of the Cure Period) on any or all
Post-Closing Properties as set forth in Sections 9.3(c)(ii) and (iii), and
terminate this Agreement with respect to the balance of the Post-Closing
Properties, in which event Seller shall be free to sell such Post-Closing
Properties to any third party, without any claim by or liability to Purchaser;
or (ii) terminate this Agreement with respect to all such Post-Closing
Properties, in which event Seller shall be free to sell such Post-Closing
Properties to any third party, without any claim by or liability to Purchaser.

                      (e) Nothing contained in this Section 9.3 shall be
construed so as to bestow any right of termination upon Purchaser for the
failure of a condition to be satisfied (i) unless Purchaser is expressly
entitled to the satisfaction of such condition as provided in Section 9.1; or
(ii) in the event that Seller's failure to meet said condition is caused by
Purchaser. Notwithstanding anything to the contrary set forth in this Section
9.3 or elsewhere in this Agreement, Seller's obligation to use diligent good
faith efforts shall not obligate Seller to bring any action or proceeding, to
make any payments or otherwise to incur any expense in order to satisfy any
unmet closing conditions not waived by Purchaser, unless such obligation is
expressly provided in this Agreement. Additionally, Seller's failure to use
diligent good faith efforts to satisfy any unmet closing conditions shall not
entitle Purchaser to the Break Up Fee. For the purposes of this Agreement, each
party hereto shall be deemed ready, willing and able to meet a closing condition
in the event that such party's failure to satisfy such condition is caused by
the other party. The parties hereto agree that the Sellers of any unclosed
portion of the Group A Portfolio shall be jointly and severally liable to
Purchaser for the Break Up Fee, to the extent that one is payable pursuant to
this Agreement.

                  9.4 In the event that any condition contained in Section 9.2
is not satisfied by Purchaser, provided that all of the conditions set forth in
Section 9.1 shall have been met by Seller or waived by Purchaser (unless
Seller's failure to meet said conditions is caused by Purchaser), Seller shall
have the right to elect to (a) waive such unsatisfied condition whereupon title
shall close as provided in this Agreement or (b) terminate this Agreement. In
the event Seller elects to terminate this Agreement, this Agreement shall be
terminated and Seller may, as its sole remedy, retain the Downpayment (together
with all interest accrued thereon, if any) as liquidated damages for all loss,
damage and expenses suffered by Seller, it being agreed that Seller's damages
are impossible to ascertain, and neither party shall have any further rights,
obligations or liabilities hereunder, except for the Surviving Obligations.


                                       25
<PAGE>

                  9.5 For the purposes of this Agreement, in the event that any
portion of the Group A Portfolio is either (a) excluded from the scope of this
Agreement pursuant to Sections 6.2, 7.1(a)(viii); or (b) subjected to the
provisions of Section 9.3 pursuant to Sections 6.1(b), 7.1(d), or 18.2(c), the
Property (or Ground Lease) so excluded or subjected to the provisions of Section
9.3 shall be included in the calculation of Properties (or Ground Lease) for
which closing conditions have not been met (both with respect to number and
value). Notwithstanding the foregoing, in the event that (i) Purchaser fails to
close on a Post-Closing Property after delivery of written notice to Seller of
Purchaser's intent to close; or (ii) Purchaser defaults under the Group B
Agreement (beyond the expiration of any applicable cure period), (a) Seller
shall be free to sell such Post-Closing Properties to any third party, without
any claim by or liability to Purchaser, and (b) none of such excluded or
subjected Properties (or Ground Lease) shall continue to be included in the
calculation of Properties (or Ground Lease) for which closing conditions have
not been met (both with respect to number and value) under either this Agreement
or the Group B Agreement.

                  9.6 Notwithstanding anything to the contrary contained in this
Agreement, in the event that the closing under the Group B Agreement is
scheduled to occur prior to the expiration of the Cure Period, Seller shall have
the right, prior to the Group B Closing and upon delivery of not less than five
(5) days prior written notice to Purchaser, to either (i) transfer any unclosed
Properties (or Ground Lease) in the Group A Portfolio to an entity (the
"Transferee") in which Philips (as defined below) holds no interest (whether
direct or indirect), which Transferee shall assume all of the applicable
Seller's rights and obligations under this Agreement (including, without
limitation, the obligation to convey title to its Property (or Ground Lease) to
Purchaser in accordance with the terms and conditions of this Agreement); or
(ii) permit Philips to distribute to Philips' general partner (as a
non-liquidating distribution) or its designee Philips' entire partnership (or
membership) interest in the Seller that owns the applicable Property (or Ground
Lease). Prior to the expiration of such five (5) days of Purchaser's receipt of
such notice, Purchaser shall have the right to elect (a) to continue to proceed
under the Group A Agreement, notwithstanding such transfer(s) by Seller (in
which event the Transferee or the Seller shall have all of the rights and
obligations of the applicable Seller under this Agreement as aforesaid), or such
transfer by Philips, in which event the applicable Seller shall remain bound
under this Agreement; or (b) to waive the unmet closing condition and close on
such unclosed Property (or Ground Lease) as if Purchaser had delivered the ten
(10) day notice set forth in Section 9.3(c)(ii), in which event Seller's notice
of transfer to the Transferee (or distribution by Philips) shall be deemed null
and void, Purchaser shall be deemed to have waived any unmet closing conditions
with respect to such unclosed Property (or Ground Lease), and the closing for
such Property (or Ground Lease) shall be held on the earlier to occur of (A) the
closing date under the Group B Agreement, and (B) the date set forth in Section
9.3(c)(ii). In the event that Purchaser elects to waive the unmet closing
condition and proceed under Section 9.6(b) above, but fails to close as required
under this Agreement, (x) Seller shall be free to sell such Property (or Ground
Lease) to any third party, without any claim by or liability to Purchaser, and
(y) such Property (or Ground Lease) shall no longer be included in the
calculation of Properties (or Ground Lease) for which closing conditions have
not been met (both with respect to number and value) under either this Agreement
or the Group B Agreement.


                                       26
<PAGE>

                  9.7 In the event that Purchaser terminates the Group B
Agreement pursuant to Section 19.2 of the Group B Agreement, and a Property (or
Ground Lease) from the Group A Portfolio was used in the calculation of the
necessary termination threshold (two or more properties valued at more than
$20,000,000), Seller shall no longer have the right to acquire any portion of
Group A Portfolio.

         Section 10. Documents to be Delivered by Seller at Closing

                  10.1 At the Closing, each Seller shall execute, acknowledge
and/or deliver (or cause to be delivered), as applicable, the following to
Purchaser or the Title Company:

                      (a) A bargain and sale deed with covenant against
grantor's acts, or its equivalent, in recordable form and otherwise reasonably
acceptable to the parties (the "Deed"), conveying title to the Property(ies)
owned by such Seller.

                      (b) An assignment and assumption of Yonkers' right, title
and interest in and to the Ground Lease in the form of Exhibit "B" annexed
hereto and made a part hereof, assigning free of liens, encumbrances and claims
(except Permitted Encumbrances and as set forth in Section 6) all of Yonkers'
right, title and interest in and to the Ground Lease (the "Ground Lease
Assignment"). [Yonkers only]

                      (c) The Assignment and Assumption of Leases and Security
Deposits in the form of Exhibit "C" annexed hereto and made a part hereof
assigning free of liens, encumbrances and claims (except Permitted Encumbrances
and as set forth in Section 6) all of such Seller's right, title and interest,
if any, in and to the Leases, all guarantees thereof and the Security Deposits
thereunder in such Seller's possession, if any (the "Lease Assignment").

                      (d) The Assignment and Assumption of Licenses and
Intangible Property in the form of Exhibit "D" annexed hereto and made a part
hereof (the "License and Intangible Property Assignment"; together with the
Lease Assignment, the "Assignment Agreements") assigning free of liens,
encumbrances and claims (except Permitted Encumbrances and as set forth in
Section 6) all of such Seller's right, title and interest, if any, in and to (i)
all of the assignable licenses, permits, certificates, approvals, authorizations
and variances issued for or with respect to its Property (or the Ground Lease)
by any governmental authority (collectively, the "Licenses"); and (ii) all
intangible property owned by such Seller with respect to the operation of its
Property (including, without limitation, trade names, assumed names and trade
logos); and, if any, transferable guarantees and warranties relating to the
Property (or the Ground Lease) (the "Intangible Property").

                      (e) Intentionally Deleted.

                      (f) To the extent in such Seller's possession or control,
executed counterparts of all Leases and New Leases and any amendments,
guarantees and other documents relating thereto, together with a schedule of all
tenant security deposits thereunder (the "Security


                                       27
<PAGE>

Deposits") and the accrued interest on such Security Deposits payable to tenants
which are in the possession of or received by such Seller, and a credit to
Purchaser against the Purchase Price, in the aggregate amount of such Security
Deposits and accrued interest thereon payable to tenants which are in the
possession of or received by such Seller. In the event any such cash Security
Deposits and the interest thereon payable to tenants are held by a bank, savings
bank, trust company or savings and loan association, such Seller shall, if
required by Law, deliver to Purchaser, in lieu of such credit, an assignment to
Purchaser of such deposits and interest, in form reasonably acceptable to the
parties, and written instructions to the holder thereof to transfer such
deposits and interest to Purchaser. With respect to any lease securities which
are other than cash, such Seller shall execute and deliver to Purchaser at the
Closing any appropriate instruments of assignment or transfer without warranty
or representation. Seller shall also deliver, to the extent in the possession or
control of Seller possession of the Property and Personal Property, subject only
to possessory rights of tenants under Leases, with all keys; and Seller shall
also deliver original signed instruments of all Leases, Licenses, sepias,
drawings, plans and specifications, finance and accounting records, tenant
correspondence, and other files relevant to the Purchaser's future operation of
the Property.

                      (g) A Ground Lease estoppel from the landlord thereunder,
containing the provisions set forth in Exhibit "F-1" hereto, dated not more than
forty-five (45) days prior to the Closing.

                      (h) Notices to the tenants of its Property in the form of
Exhibit "E-2" annexed hereto and made a part hereof advising the tenants of the
sale of such Property to Purchaser and directing that all Rent and other
payments thereafter be sent to Purchaser or as Purchaser may direct.

                      (i) Copies of the consents of the members or partners (as
applicable) of such Seller authorizing the execution, delivery and performance
of this Agreement and the consummation of the transactions contemplated by this
Agreement to be undertaken by such Seller certified as true and correct by the
managing member or general partner (as applicable) of such Seller.

                      (j) To the extent in such Seller's possession and not
already located at its Property, keys to all entrance doors to, and equipment
and utility rooms located in, such Property.

                      (k) To the extent in such Seller's possession and not
already located at its Property, all Licenses.

                      (l) The transfer tax payments together with the transfer
tax returns, if any.

                      (m) A "FIRPTA" affidavit sworn to by such Seller in the
form of Exhibit "I" annexed hereto and made a part hereof. Purchaser
acknowledges and agrees that upon Seller's delivery of such affidavits,
Purchaser shall not withhold any portion of the Purchase Price


                                       28
<PAGE>

pursuant to Section 1445 of the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder.

                      (n) All Estoppel Certificates (as defined below). Promptly
following the execution and delivery of this Agreement, Seller shall have
delivered to each Tenant in the Group A Portfolio an estoppel certificate in the
form annexed hereto as Exhibit "F-3", completed to reflect each Tenant's
particular Lease status and dated not more than forty-five (45) days prior to
the Closing. Seller agrees to use commercially reasonable efforts to obtain from
such Tenants the estoppel certificates in such form; provided, however, that if
any Tenant shall refuse to execute an estoppel letter in such form, Seller shall
use commercially reasonable efforts to obtain an estoppel certificate in the
form that such Tenant is required to provide under its Lease. Seller agrees to
deliver to Purchaser copies of all estoppel letters received from Tenants in the
form received by Seller. Seller shall deliver at Closing an estoppel certificate
from those Tenants set forth on Schedule 10.1(n) hereto, in the form required
above; the estoppel certificates received from all other Tenants; and, subject
to Section 7.1(f), in the event that any Tenant (other than one set forth on
Schedule 10.1(n)) fails to deliver an estoppel certificate in the form set forth
above, Seller shall provide Purchaser with a certificate of Seller, setting
forth those items required above, on behalf of such Tenant (collectively, the
"Estoppel Certificates"). Subject at all times to Section 7.1(c), an Estoppel
Certificate shall not be deemed "delivered" by Seller to the extent that such
Estoppel Certificate conflicts with Seller's representations and warranties in
connection with the applicable Lease.

                      (o) An assignment of the Escrow Deposits, in form
reasonably acceptable to the parties.

                      (p) Intentionally Deleted

                      (q) Signed settlement statements (covering all
apportionments for each Property (and the Ground Lease)) (the "Settlement
Statements").

                      (r) A certificate updating all of Seller's representations
as of the Closing Date, as required by Section 7.1(b);

                      (s) Such affidavits; "mechanic's lien," "gap," "parties in
possession" or other Seller indemnities; evidence of authority; releases of
liens; or other instruments as the Title Company may reasonably request to issue
a title policy satisfactory to Purchaser in accordance with Article 6.

                      (t) An estoppel certificate from each REA Party
substantially in the form of Exhibit "F-2" annexed hereto, dated not more than
forty-five (45) days prior to the Closing, and a notice to the other REA Parties
respecting the change in ownership substantially in the form of Exhibit "E-1"
annexed hereto.

                      (u) The Mortgagee Consents and Mortgagee Payoff Updates
required by Section 18.2.


                                       29
<PAGE>

                      (v) Seller agrees, not later than five (5) business days
following the execution and delivery of this Agreement, to request the Mortgagee
Consent from each Mortgagee, and to use diligent, good faith efforts to obtain
same as promptly as possible in the form required by Section 10.1(u). Seller
agrees to pay to Mortgagee at or prior to Closing, any transfer fees, legal
fees, and all other amounts required under the Mortgages or Property Notes (or
otherwise required by Mortgagee) in connection with the transfer. Except as set
forth in this Agreement, Purchaser shall not be required to pay any amounts,
agree to any changes in the Property Notes or Mortgages, or otherwise incur any
additional obligations and/or liabilities in connection with obtaining the
Mortgagee Consent from any Mortgagee.

                      (w) A bill of sale in substantially the form of Exhibit
"L" annexed hereto and made a part hereof (the "Bill of Sale") conveying and
transferring and selling to Purchaser without warranty or representation all of
such Seller's right title and interest in and to all Personal Property.

                      (x) An estoppel letter from the Glen Cove Community
Development Agency (the "Glen Cove Estoppel") in the form of Exhibit "F-4"
annexed hereto and made a part hereof, dated not more than forty-five (45) days
prior to the Closing. [Glen Cove only]

                      (y) A termination of any management agreements for the
applicable Property (or Ground Lease).

                      (z) All other documents such Seller is reasonably required
to deliver to effectuate the transactions contemplated by this Agreement.

         Section 11. Documents to be Delivered by Purchaser at Closing

                  11.1 At the Closing, Purchaser shall execute, acknowledge
and/or deliver, as applicable, the following to Seller:

                      (a) The cash portion of the Purchase Price payable at the
Closing pursuant to Section 2(b), subject to apportionments, credits and
adjustments as provided in this Agreement.

                      (b) Intentionally Deleted.

                      (c) The sales tax returns, if required, together with a
good, unendorsed certified or official bank check drawn on or by a Clearing
House Bank payable to the order of the appropriate collection officer in the
amount of the sales tax due thereon.

                      (d) Signed Settlement Statements.

                      (e) If Purchaser is a partnership, copies of Purchaser's
partnership certificate and, if required by Law, any lender, or Purchaser's
partnership agreement, copies of


                                       30
<PAGE>

partnership resolutions and/or consents of the partners authorizing the
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated by this Agreement, all certified as true and
correct by a general partner of Purchaser.

                      (f) The Assignment Agreements.

                      (g) The transfer tax returns, if any.

                      (h) The Ground Lease Assignment.

                      (i) Subject to the limitations set forth in Section 18,
any documents reasonably required by the Mortgagees in connection with the
assumptions referenced in Section 18.2 or by Prudential in connection with the
assignments referenced in Section 18.3.

                      (j) A certificate updating all of Purchaser's
representations as of the Closing Date, as required by Section 7.2(b).

                      (k) The consents of Kimco Realty Corporation and The New
York Common Fund.

                      (l) All other documents such Purchaser is reasonably
required to deliver to effectuate the transactions contemplated by this
Agreement.

         Section 12. Operation of the Group A Portfolio Prior to the Closing
Date.

                  12.1 (a) (i) Between the date hereof and the Closing Date, (A)
Seller shall not enter into, renew, modify, terminate or otherwise amend any
Lease or other document affecting any Property (or the Ground Lease) without
Purchaser's prior consent in each instance, which consent shall not be
unreasonably withheld or delayed, and shall be given or denied, with the reasons
for any such denial, within the applicable period specified in Section
12.1(a)(iv); (B) Seller shall not enter into any property operating maintenance
or service or other contracts requiring more than thirty (30) days notice to
terminate, (C) Seller shall not apply any Security Deposits without Purchaser's
prior written consent, and (D) Seller shall continue to maintain and repair each
Property (and the Ground Lease) as in its normal course of business.

                           (ii) If, following Purchaser's consent, Seller enters
into any new Leases, or if there is any modification, expansion, extension or
renewal of any existing Leases (not provided for therein)(each, a "New Lease"),
Seller shall keep accurate records of all bona fide, third party expenses
(collectively, "New Lease Expenses") incurred in connection with each New Lease,
including, without limitation, the following: (A) brokerage commissions and fees
relating to such leasing transaction, (B) expenses incurred for repairs,
improvements, equipment, painting, decorating, partitioning and other items to
satisfy the tenant's requirements with regard to such leasing transaction, (C)
the cost of removal and/or abatement of asbestos or other hazardous or toxic
substances located in the demised space, (D) reimbursements to the tenant for
the cost of any of the items described in the preceding clauses (B) and (C), (E)
in the event that


                                       31
<PAGE>

Purchaser declines to have its counsel draft the documents relating thereto,
Seller's reasonable legal fees for services in connection with the preparation
of documents and other services rendered in connection with the effectuation of
the leasing transaction, (F) Rent concessions relating to the demised space
provided the tenant has the right to take possession of such demised space
during the period of such Rent concessions, and (G) expenses incurred for the
purpose of satisfying or terminating the obligations of a tenant under a New
Lease to the landlord under another lease (whether or not such other lease
covers space in the applicable Property).

                           (iii) The New Lease Expenses for each New Lease
allocable to and payable by Seller shall be determined by multiplying the amount
of such New Lease Expenses by a fraction, the numerator of which shall be the
number of days contained in that portion, if any, of the term of such New Lease
commencing on the rent commencement date of such New Lease (the "Rent
Commencement Date") and expiring on the date immediately preceding the Closing
Date, and the denominator of which shall be the total number of days contained
in the period commencing on the Rent Commencement Date and expiring on the date
of the scheduled expiration of the term of such New Lease, and the remaining
balance of the New Lease Expenses for each New Lease shall be allocable to and
payable by Purchaser. At the Closing, Purchaser shall reimburse Seller for all
New Lease Expenses theretofore paid by Seller, if any, in excess of the portion
of the New Lease Expenses allocated to Seller pursuant to the provisions of the
preceding sentence. The provisions of this Section 12.1(a)(iii) shall survive
the Closing.

                           (iv) With respect to any proposed action by Seller to
be submitted to Purchaser for its consent pursuant to Section 12.1 (a)(i),
Purchaser shall consent or deny its consent, with the reasons for any such
denial, within the following five (5) business days. If notice of any denied
consent is not received, Purchaser's consent shall be deemed to have been
granted.

                      (b) Notwithstanding anything to the contrary contained in
this Agreement, Seller reserves the right, but is not obligated, to institute
summary proceedings against any tenant or terminate any Lease as a result of a
default by the tenant thereunder prior to the Closing Date. Seller makes no
representations and assumes no responsibility with respect to the continued
occupancy of the Group A Portfolio or any part thereof by any tenant. The
removal of a tenant prior to the Closing Date, whether by summary proceedings
(or any written agreement accepting surrender or termination of the Lease
subsequent to the commencement of such summary proceedings) or unilateral act of
such tenant, shall not give rise to any claim on the part of Purchaser. Further,
Purchaser agrees that it shall not be grounds for Purchaser's refusal to close
this transaction that any tenant is a holdover tenant or in default under its
Lease on the Closing Date and Purchaser shall accept title subject to such
holding over or default without credit against, or reduction of, the Purchase
Price.

                      (c) Between the date hereof and the Closing Date, Seller
shall not renew, modify, terminate or otherwise amend any REA, Property Note, or
Mortgage or other related document affecting any Property (or the Ground Lease),
or enter into any proposed service contracts, REAs, promissory notes or
mortgages, without Purchaser's consent, which


                                       32
<PAGE>

consent shall not be unreasonably withheld or delayed, and shall be given or
denied, with the reasons for any such denial, within the applicable period
specified in Section 12.1(a)(iv); provided, however, that Purchaser's consent
shall not be required to the aforestated actions if such REA or other document
may be terminated at any time on not more than thirty (30) days' prior notice by
Seller, or its successor, without the payment of a penalty.

                      (d) Subject to the provisions of the applicable Lease,
with respect to the tax year in which the Closing occurs, and all prior tax
years, Seller is hereby authorized to commence, continue and control the
progress of, and to make all decisions with respect to, any proceeding or
proceedings, whether or not now pending, for the reduction of the assessed
valuation of any Property, and, in its sole discretion, to try or settle the
same. All net tax refunds and credits (including net of any refunds due Tenants)
attributable to any tax year prior to the tax year in which the Closing occurs
shall belong to and be the property of Seller. All net tax refunds and credits
(including net of any refunds due Tenants) attributable to any tax year
subsequent to the tax year in which the Closing occurs shall belong to and be
the property of Purchaser. All net tax refunds and credits attributable to the
tax year in which the Closing occurs shall be divided between Seller and
Purchaser in accordance with the apportionment of taxes pursuant to the
provisions of this Agreement, after deducting therefrom a pro rata share of all
expenses, including, without limitation, counsel fees and disbursements and
consultant's fees, incurred in obtaining such refund, the allocation of such
expenses to be based upon the total refund obtained in such proceeding and in
any other proceeding simultaneously involved in the trial or settlement.
Purchaser agrees to reasonably cooperate with Seller in connection with the
prosecution of any such proceedings and to take all steps, whether before or
after the Closing Date, as may be necessary to carry out the intention of the
foregoing, including, without limitation, the delivery to Seller, upon demand,
of any relevant books and records, including receipted tax bills and canceled
checks used in payment of such taxes, the execution of any and all consents or
other documents, and the undertaking of any act reasonably necessary for the
collection of such refund by Seller. Notwithstanding anything herein to the
contrary, (i) Seller shall not take any action that would compromise or settle
the tax year in which the Closing occurs without Purchaser's prior written
consent, which shall not be unreasonably withheld or delayed; and (ii) Seller
shall not take any action that would compromise or settle any tax year
subsequent to the tax year in which the Closing occurs without Purchaser's prior
written consent, which may be withheld in Purchaser's sole discretion. The
provisions of this Section 12.1(d) shall survive the Closing. In the event that
Seller takes any action that would compromise or settle any tax year prior to
the tax year in which the Closing occurs (as permitted above), Seller shall bear
the entire cost and expense thereof. In the event Seller takes any action that
would compromise or settle the tax year in which the Closing occurs (as
permitted above), Seller and Purchaser shall share proportionately (as set forth
above) in the cost and expense thereof. In the event that Seller takes any
action that would compromise or settle any tax year subsequent to the tax year
in which the Closing occurs (as permitted above), Purchaser shall bear the
entire cost and expense thereof.

                  12.2 Notwithstanding Seller's obligations under Section
12.1(a)(i)(D), the parties hereby acknowledge and agree that Seller shall not
undertake any improvements in connection with certain currently vacant premises
at the Glen Cove Property (constituting


                                       33
<PAGE>

approximately 5,300 square feet) and, in return, Seller shall credit Purchaser
at the Closing with an amount equal to $40,000.00, which sum represents the
parties' estimate of the Purchaser's cost to complete such improvements, and
shall constitute the maximum amount of Seller's obligation to Purchaser
therefor.

         Section 13. As Is

                  13.1 Purchaser expressly acknowledges and agrees, subject to
any relevant provisions of this Agreement, to accept title to the Group A
Portfolio on an "as-is-where-is and with all faults" basis.

                  13.2 This Agreement, as written, contains all the terms of the
agreement entered into between the parties as of the date hereof, and Purchaser
acknowledges that neither Sellers nor any of Seller's Affiliates, nor any of
their agents or representatives, has made any representations or held out any
inducements to Purchaser, and Sellers hereby specifically disclaim any
representation, oral or written, past, present or future, other than those
specifically set forth in this Agreement. Without limiting the generality of the
foregoing, Purchaser has not relied on any representations or warranties, and
neither Sellers nor any of Sellers' Affiliates, nor any of their agents or
representatives has or is willing to make any representations or warranties,
express or implied, other than as may be expressly set forth herein, as to (a)
the status of title to the Group A Portfolio; (b) the Leases; (c) the Licenses;
(d) the current or future real estate tax liability, assessment or valuation of
the Group A Portfolio; (e) the potential qualification of the Group A Portfolio
for any and all benefits conferred by any Laws whether for subsidies, special
real estate tax treatment, insurance, mortgages or any other benefits, whether
similar or dissimilar to those enumerated; (f) the compliance of the Group A
Portfolio in its current or any future state with applicable Laws or any
violations thereof; including, without limitation, those relating to access for
the handicapped, environmental or zoning matters, and the ability to obtain a
change in the zoning or a variance in respect to the Group A Portfolio's
non-compliance, if any, with zoning Laws; (g) the nature and extent of any
right-of-way, lease, possession, lien, encumbrance, license, reservation,
condition or otherwise; (h) the availability of any financing for the purchase,
alteration, rehabilitation or operation of the Group A Portfolio from any
source, including, without limitation, any government authority or any lender;
(i) the current or future use of the Group A Portfolio; (j) the present and
future condition and operating state of any Personal Property and the present or
future structural and physical condition of the Buildings, their suitability for
rehabilitation or renovation, or the need for expenditures for capital
improvements, repairs or replacements thereto; (k) the viability, financial
condition or continued occupancy of any Tenant; (l) the status of the leasing
market in which any Property is located; or (m) the actual or projected income
or operating expenses of the Group A Portfolio.

                  13.3 Purchaser acknowledges that Seller has afforded and will
continue to afford Purchaser the opportunity for full and complete
investigations, examinations and inspections of the Group A Portfolio and all
Property Information. Purchaser acknowledges and agrees that (a) the Property
Information delivered or made available to Purchaser and Purchaser's
Representatives by Seller or Seller's Affiliates, or any of their agents or
representatives may have been prepared by third parties and may not be the work
product of Seller and/or any of Seller's


                                       34
<PAGE>

Affiliates; (b) neither Seller nor any of Seller's Affiliates has made any
independent investigation or verification of, or has any knowledge of, the
accuracy or completeness of, the Property Information; (c) the Property
Information delivered or made available to Purchaser and Purchaser's
Representatives is furnished to each of them at the request, and for the
convenience of, Purchaser; (d) Purchaser is relying solely on its own
Investigations (as defined below), examinations and inspections of the Group A
Portfolio and those of Purchaser's Representatives and is not relying in any way
on the Property Information furnished by Seller or any of Seller's Affiliates,
or any of their agents or representatives; (e) Seller expressly disclaims any
representations or warranties with respect to the accuracy or completeness of
the Property Information and Purchaser releases Seller and Seller's Affiliates,
and their agents and representatives, from any and all liability with respect
thereto; and (f) any further distribution of the Property Information is subject
to Section 23.

                  13.4 (a) Except as expressly set forth herein or in any
closing document, Purchaser or anyone claiming by, through or under Purchaser,
hereby fully and irrevocably releases Seller and Seller's Affiliates, and their
agents and representatives, from any and all claims that it may now have or
hereafter acquire against Seller or Seller's Affiliates, or their agents or
representatives for any cost, loss, liability, damage, expense, action or cause
of action, whether foreseen or unforeseen, arising from or related to any
construction defects, errors or omissions on or in the Group A Portfolio, the
presence of environmentally hazardous, toxic or dangerous substances, or any
other conditions (whether patent, latent or otherwise) affecting the Group A
Portfolio, except for claims against Seller based upon any obligations and
liabilities of Seller expressly provided in this Agreement. Purchaser further
acknowledges and agrees that this release shall be given full force and effect
according to each of its expressed terms and provisions, including, but not
limited to, those relating to unknown and suspected claims, damages and causes
of action. As a material covenant and condition of this Agreement, Purchaser
agrees that in the event of any such construction defects, errors or omissions,
the presence of environmentally hazardous, toxic or dangerous substances, or any
other conditions affecting the Group A Portfolio, Purchaser shall look solely to
Seller's predecessors in interest or to such contractors and consultants as may
have contracted for work in connection with the Group A Portfolio for any
redress or relief, except for claims against Seller based upon any obligations
and liabilities of Seller expressly provided in this Agreement. Purchaser
further understands that some of Seller's predecessors in interest or such
contractors and consultants may have filed petitions under the bankruptcy code
and Purchaser may have no remedy against such predecessors, contractors or
consultants.

                      (b) Notwithstanding anything to the contrary contained in
Section 13.4(a), Seller hereby agrees to cooperate in good faith with Purchaser
(at Purchaser's sole cost and expense) in the event that Purchaser cannot,
without the cooperation of Seller, maintain an action against a third party for
any matter from which Seller has been released; provided, however, that in no
event shall such cooperation permit Purchaser to recover against Seller or
Seller's Affiliates for any cost, loss, liability, damage, expense, action or
cause of action, whether foreseen or unforeseen, arising from or related to any
construction defects, errors or omissions on or in the Group A Portfolio, the
presence of environmentally hazardous, toxic or dangerous


                                       35
<PAGE>

substances, or any other conditions (whether patent, latent or otherwise)
affecting the Group A Portfolio or otherwise as provided in Section 13 herein.

                  13.5 Purchaser acknowledges that, as of the expiration of the
Inspection Period, it shall have (a) undertaken its Investigations, (b)
inspected, become thoroughly acquainted with and accepted the condition of the
Group A Portfolio; and (c) reviewed, to the extent necessary in its discretion,
all the Property Information. Except as expressly provided herein, Seller shall
not be liable or bound in any manner by any oral or written "setups" or
information pertaining to the Group A Portfolio or the Rent furnished by Seller,
Seller's Affiliates, their agents or representatives, any real estate broker,
including, without limitation, the Broker, or other person.

                  13.6 The provisions of this Section 13 shall survive the
termination of this Agreement and the Closing.

         Section 14.  Broker

                  14.1 Purchaser and Sellers represent and warrant to the other
that it or they, as the case may be, have not dealt with any broker in
connection with the Group A Portfolio and the transactions described herein
other than CIBC World Markets Corp. and Prudential Securities Incorporated, who
shall be paid pursuant to separate agreements with Purchaser and Seller,
respectively. Each party hereto agrees to indemnify, defend and hold the other
harmless from and against any and all claims, causes of action, losses, costs,
expenses, damages or liabilities, including reasonable attorneys' fees and
disbursements, which the other may sustain, incur or be exposed to, by reason of
any claim or claims by any broker, finder or other person, for fees, commissions
or other compensation arising out of the transactions contemplated in this
Agreement if such claim or claims are based in whole or in part on dealings or
agreements with the indemnifying party.

                  14.2 The obligations and representations and warranties
contained in this Section 14 shall survive the termination of this Agreement and
the Closing.

         Section 15. Casualty; Condemnation

                  15.1 Damage or Destruction If a "material" part (as
hereinafter defined) of any Property (or the Yonkers Property) is damaged or
destroyed by fire or other casualty, Seller shall notify Purchaser of such fact
and, except as hereinafter provided, Purchaser shall have the option to exclude
such Property (or Ground Lease) from the Group A Portfolio upon notice to Seller
given not later than ten (10) days after receipt of Seller's notice. In the
event a Property (or Ground Lease) is excluded as aforesaid, such excluded
Property (or Ground Lease) shall not be subject to the provisions of Section 9
hereof, and (a) the Purchase Price shall be reduced by the allocation for such
Property (or Ground Lease) in Section 2.1(b), (b) the portion of the Downpayment
allocable to such Property (or Ground Lease) shall be reallocated equally among
the remaining portion of the Group A Portfolio, (c) the balance of the Group A
Portfolio shall be otherwise unaffected, and (d) Seller shall be free to sell
such Excluded Property to any third party, without any claim by or liability to
Purchaser. If (x) Purchaser does not elect to


                                       36
<PAGE>

exclude such Property (or Ground Lease), or (y) there is damage to or
destruction of an "immaterial" part ("immaterial" is herein deemed to be any
damage or destruction which is not "material", as such term is hereinafter
defined) of any Property (or the Yonkers Property), Purchaser shall close title
as provided in this Agreement and, at the Closing, Seller shall, unless Seller
has repaired such damage or destruction prior to the Closing, (A) pay over to
Purchaser the proceeds of any insurance collected by Seller less the amount of
all costs incurred by Seller in connection with the repair of such damage or
destruction, (B) credit Purchaser at Closing with the amount of any deductible
under the policy for the applicable Property (or Yonkers Property), and (C)
assign and transfer to Purchaser all right, title and interest of Seller in and
to any uncollected insurance proceeds which Seller may be entitled to receive
from such damage or destruction. A "material" part of a Property (or Yonkers
Property) shall be deemed to have been damaged or destroyed if the cost of
repair or replacement, as reasonably estimated by Seller, shall exceed the
greater of (a) two percent (2%) of the Purchase Price of such Property (or
Ground Lease) set forth in Section 2.1(b); or (b) $250,000.00.

                  15.2 Condemnation If, prior to the Closing Date, all or any
"significant" portion (as hereinafter defined) of a Property (or Yonkers
Property) is taken by eminent domain or condemnation (or is the subject of a
pending taking which has not been consummated), Seller shall notify Purchaser of
such fact and the Purchaser shall have the option to exclude such Property (or
Ground Lease) from the Group A Portfolio upon notice to the Seller given not
later than ten (10) days after receipt of the Seller's notice. In the event a
Property (or Ground Lease) is excluded as aforesaid, such excluded Property (or
Ground Lease) shall not be subject to the provisions of Section 9 hereof, and
(a) the Purchase Price shall be reduced by the allocation for such Property (or
Ground Lease) in Section 2.1(b), (b) the portion of the Downpayment allocable to
such Property (or Ground Lease) shall be reallocated equally among the remaining
portion of the Group A Portfolio, (c) the balance of the Group A Portfolio shall
be otherwise unaffected, and (d) Seller shall be free to sell such Post-Closing
Property to any third party, without any claim by or liability to Purchaser. If
(a) Purchaser does not elect to exclude such Property (or Ground Lease), or (b)
if an "insignificant" portion ("insignificant" is herein deemed to be any taking
which is not "significant", as such term is herein defined) of the Property (or
Yonkers Property) is taken by eminent domain or condemnation, at the Closing
Seller shall assign and turn over, and Purchaser shall be entitled to receive
and keep, all awards or other proceeds for such taking by eminent domain or
condemnation. A "significant" portion of a Property (or the Yonkers Property)
shall be deemed to have been taken or condemned if the taking or condemnation
either (a) materially and adversely affects access between the Property (or
Yonkers Property) and a public street, (b) takes or condemns any material
portion of the building located on the applicable Property (or Yonkers
Property), (c) materially and adversely affects the availability of parking at
the applicable Property (or Yonkers Property), or (d) gives any Tenant that
represents more than 10% of the rental income for the applicable Property (or
Ground Lease) the right to terminate its Lease.

                  15.3 Notwithstanding anything contained in Section 15.1 and
Section 15.2 to the contrary, if the insurance, eminent domain or condemnation
proceeds payable with respect to the Group A Portfolio as a result of any
casualty or taking exceeds the Purchase Price allocable to such Property (or
Ground Lease), Seller's obligation to pay over to Purchaser those proceeds paid


                                       37
<PAGE>

to Seller prior to the Closing shall be limited to the amount of the Purchase
Price allocable to such Property (or Ground Lease) and Seller shall be entitled
to retain the remainder of such proceeds. To the extent that payment of all or
any portion of such proceeds does not occur prior to the Closing, the parties
agree that Seller shall be entitled to that portion of the proceeds in excess of
the Purchase Price, which agreement shall survive the Closing.

         Section 16. Remedies

                  16.1 If, prior to the expiration of the Extended Closing
Period, Purchaser has met (or is ready, willing and able to meet) all closing
conditions set forth in Section 9.2, and Seller willfully refuses to close or to
meet a closing condition, Purchaser shall, as its sole and exclusive remedy,
subject to the provisions of Sections 9.3 and 16.3, have the right to (a)
terminate this Agreement upon written notice to Seller; and (b) receive (upon
such termination) the Break Up Fee (as liquidated damages and as agreed
compensation for Purchaser's lost opportunity and expenses, and not as a
penalty), in which event this Agreement shall be terminated and neither party
shall have any further rights, obligations or liabilities hereunder, except for
the provisions of Sections 14, 17, 19 and 23 hereof which shall survive (the
"Surviving Obligations"), and except that Purchaser shall be entitled to a
return of the Downpayment (together with all interest accrued thereon, if any)
and any amounts to which the Group B Purchaser is expressly entitled under the
Group B Agreement. The parties hereto agree that Seller shall not be deemed to
have willfully refused to meet a closing condition or close in the event that
Seller is either (w) unable, after diligent good faith efforts, to meet such
closing conditions; (x) diligently proceeding in good faith to satisfy such
closing condition, (y) not obligated to satisfy such closing condition hereunder
or (z) not obligated to close hereunder. Except as set forth in this Section
16.1, Purchaser hereby expressly waives, relinquishes and releases any other
right or remedy available to it at law, in equity or otherwise by reason of
Seller's inability to perform its obligations hereunder.

                  16.2 If, prior to the expiration of the Extended Closing
Period, Seller has met (or is ready, willing and able to meet) all closing
conditions set forth in Section 9.1, and Purchaser willfully refuses to close or
meet a closing condition, Seller shall, as its sole and exclusive remedy, have
the right to (a) terminate this Agreement by notice to Purchaser; and (b) retain
the Downpayment (together with all interest accrued thereon, if any) and the
downpayment paid by or to be paid by (together with all interest accrued
thereon, if any) the Group B Purchaser under the Group B Agreement (as defined
below) as liquidated damages for all loss, damage and expenses suffered by
Seller, it being agreed that Seller's damages are impossible to ascertain,
following which neither party shall have any further rights, obligations or
liabilities hereunder, except for the Surviving Obligations. Nothing contained
herein, including without limitation the Closing, shall limit or restrict
Seller's ability to pursue any rights or remedies it may have against Purchaser
with respect to the Surviving Obligations. Except as set forth in this Section
16.2 and Section 23.6, Seller hereby expressly waives, relinquishes and releases
any other right or remedy available to it at law, in equity or otherwise by
reason of Purchaser's default hereunder or Purchaser's failure or refusal to
perform its obligations hereunder.


                                       38
<PAGE>

                  16.3 Notwithstanding anything to the contrary contained
herein, in no event shall the Break Up Fee be paid more than once. Upon the
occurrence of multiple defaults (or rights to terminate) under this Agreement,
any of which would otherwise entitle a party to the Break Up Fee, the Break Up
Fee shall not be payable in the event that it had been paid on account of
another default (or termination). Notwithstanding the foregoing, nothing
contained herein shall preclude the break up fee payable under the Group B
Agreement from being paid in accordance with the terms of the Group B Agreement.

         Section 17. Purchaser's Access to the Properties

                  17.1 Between the date hereof and the Closing Date, provided
that this Agreement has not been terminated as expressly permitted herein,
Purchaser and Purchaser's Representatives shall have the right to enter upon the
Properties (and, subject to the terms of the Ground Lease, the Yonkers Property)
for the sole purpose of inspecting the Properties (and the Yonkers Property),
and Purchaser, at its sole cost and expense, may perform, or cause to be
performed, tests, investigations and studies of or related to the Properties
(and, subject to the terms of the Ground Lease, the Yonkers Property),
including, but not limited to, soil tests and borings, ground water tests and
investigations, percolation tests, surveys, architectural, engineering,
subdivision, environmental, access, financial, market analysis, development and
economic feasibility studies and other tests, investigations or studies as
Purchaser, in its sole discretion, determines is necessary or desirable in
connection with the Group A Portfolio and may inspect the physical (including
environmental) and financial condition of the Group A Portfolio, including but
not limited to Leases, service contracts, copies of Seller's filings with the
Securities and Exchange Commission, engineering and environmental reports,
development approval agreements, permits and approvals (collectively, the
"Investigations"); provided: (a) Purchaser shall give Seller not less than one
(1) day's prior notice before each entry; (b) each notice shall include
sufficient information to permit Seller to review the scope of the proposed
Investigations; (c) neither Purchaser nor Purchaser's Representatives shall
permit any borings, drillings or samplings to be done on any of the Properties
(or the Yonkers Property) without Seller's prior written consent, which shall
not be unreasonably withheld or delayed; and (d) any entry upon any of the
Properties (or the Yonkers Property) and all Investigations shall be during
Seller's normal business hours and at the sole risk and expense of Purchaser and
Purchaser's Representatives, and shall not interfere in any material respect
with the activities on or about the Properties (or the Yonkers Property) of
Seller, its tenants and their employees and invitees. Seller agrees to cooperate
with Purchaser in such review and inspection. Purchaser shall:

                      (a) promptly repair any damage to any of the Properties
(or the Yonkers Property) resulting from any such Investigations and replace,
refill and regrade any holes made in, or excavations of any portion of the
Properties (or the Yonkers Property) used for such Investigations so that the
Properties (or the Yonkers Property) shall be in the same condition that it
existed in prior to such Investigations;

                      (b) fully comply with all Laws applicable to the
Investigations and all other activities undertaken in connection therewith;


                                       39
<PAGE>

                      (c) permit Seller to have a representative present during
all Investigations undertaken hereunder;

                      (d) take all actions and implement all protections
necessary to ensure that all actions taken in connection with the
Investigations, and the equipment, materials, and substances generated, used or
brought onto the Properties (or the Yonkers Property) pose no threat to the
safety or health of persons or the environment, and cause no damage to the
Properties (or the Yonkers Property) or other property of Seller or other
persons;

                      (e) furnish to Seller, upon request and at no cost or
expense to Seller, copies of all surveys, soil test results, engineering,
asbestos, environmental and other studies and reports relating to the
Investigations which Purchaser shall obtain with respect to the Properties (or
the Yonkers Property) promptly after Purchaser's receipt of same;

                      (f) Intentionally Deleted;

                      (g) not allow the Investigations or any and all other
activities undertaken by Purchaser or Purchaser's Representatives to result in
any liens, judgments or other encumbrances being filed or recorded against any
of the Properties (or the Yonkers Property or the Ground Lease), and Purchaser
shall, at its sole cost and expense, promptly discharge of record any such liens
or encumbrances that are so filed or recorded (including liens for services,
labor or materials furnished); and

                      (h) indemnify Seller and Seller's Affiliates and hold
Seller and Seller's Affiliates harmless from and against any and all claims,
demands, causes of action, losses, damages, liabilities, costs and expenses
(including attorneys' fees and disbursements), suffered or incurred by Seller or
any of Seller's Affiliates and arising out of or in connection with (i)
Purchaser's and/or Purchaser's Representatives' entry upon any or all of the
Properties (or the Yonkers Property), (ii) any Investigations or other
activities conducted thereon by Purchaser or Purchaser's Representatives, (iii)
any Liens or other encumbrances filed or recorded against any or all of the
Properties (or the Yonkers Property or the Ground Lease) as a consequence of the
Investigations or any and all other activities undertaken by Purchaser or
Purchaser's Representatives, and/or (iv) any and all other activities undertaken
by Purchaser or Purchaser's Representatives with respect to any or all of the
Properties (or the Yonkers Property).

                  17.2 Until 7:00pm on May 31, 2000 (the "Inspection Period"),
Purchaser may terminate this Agreement for any reason, by written notice given
to Seller, prior to the expiration of the Inspection Period. In the event
Purchaser terminates this Agreement during the Inspection Period, Purchaser
shall be entitled to a refund of its Downpayment, this Agreement shall be null
and void and the parties hereto shall be relieved of all further obligations
hereunder except for the Surviving Obligations (including without limitation,
Section 17.1(h)) and as otherwise expressly provided herein. In the event
Purchaser does not terminate this Agreement by the end of the Inspection Period,
then Purchaser shall be deemed to have elected not to terminate this Agreement
pursuant to this Section 17.2. Time shall be of the essence with respect to the
expiration of the Inspection Period.


                                       40
<PAGE>

                  17.3 The provisions of this Section 17 shall survive the
termination of this Agreement and the Closing.

         Section 18.  Assumption of Mortgage Debt

                  18.1 (a) The parties acknowledge that Munsey Park is
encumbered with a mortgage lien in the original principal amount of
$12,850,000.00, as evidenced by (i) that certain Consolidated Promissory Note
(the "Munsey Note") dated as of September 17, 1997, made by TH Associates LLC
and TH Associates II, as maker, in favor of State Street Bank & Trust Company,
as Trustee for the Registered Holders of Chase Commercial Mortgage Securities
Corp., Commercial Mortgage Pass-Through Certificates Series 1997-2, as mortgagee
(the "Munsey Mortgagee"), in the original principal amount of $12,850,000.00, as
reduced through the date hereof (the "Munsey Debt"), (ii) that certain Agreement
of Consolidation and Modification of Note and Mortgage (the "Munsey Mortgage")
dated as of September 17, 1997, by and between TH Associates LLC and TH
Associates II, as Mortgagors, and Munsey Mortgagee, recorded on November 5,
1997, in Liber 18226, Page 507, in the Office of the County Clerk of Nassau
County, New York, and (iii) such other loan documents, instruments or agreements
of even date (the "Munsey Loan Documents") executed in connection with the
Munsey Note and Munsey Mortgage, all as assumed by Munsey Park pursuant to that
certain [Assumption Agreement] dated ___________, and recorded on
_________________ in Liber __________, Page ______, in the Office of the County
Clerk of Nassau County, New York.

                      (b) The parties acknowledge that Henry Street is
encumbered with a mortgage lien in the original principal amount of
$3,849,718.00, as evidenced by (i) that certain Promissory Note (the "Henry
Note"; together with the Munsey Note, the "Property Notes") dated as of , made
by Henry Street, as Mortgagor, and Principal Life Insurance Company, as
mortgagee (the "Henry Mortgagee"; together with the Munsey Mortgagee, the
"Mortgagees"), in the original principal amount of $3,849,718.00, as reduced
through the date hereof (the "Henry Debt"), (ii) that certain Mortgage
[Consolidation and Modification Agreement] (the "Henry Mortgage"; together with
the Munsey Mortgage, the "Mortgages") of even date made by Henry Street and
Henry Mortgagee, recorded _________ in Reel ______, Page ______, in the
_________ County recording office, and (iii) such other loan documents,
instruments or agreements of even date (the "Henry Loan Documents"; together
with the Munsey Loan Documents, and all instruments securing or executed in
connection with same, the "Mortgage Loan Documents") executed in connection with
the Henry Note and Henry Mortgage. On or prior to the date hereof, Munsey Park
and Henry Street have delivered true and complete copies of the Mortgage Loan
Documents to Purchaser and Purchaser acknowledges the receipt of same.

                  18.2 (a) Promptly following the execution and delivery of this
Agreement, Seller shall request that the Mortgagees consent to the assumption
from and after the Closing of the Mortgages (Purchaser hereby acknowledges that
the Mortgagees are under no obligation to agree) by Purchaser or Purchaser's
wholly owned subsidiary. Any and all costs and expenses arising out of or
relating to the assumption of the Mortgages (including, without limitation,


                                       41
<PAGE>

prepayment penalties, if any, assumption fees, if any, the Mortgagees' title
insurance expenses (whether for a title search, title endorsements or a new
policy), the Mortgagees' attorney's fees and expenses, Mortgagees'
representative's fees (for example, and not by way of limitation, fees for
attending the Closing, if necessary), and recording fees and costs) shall be the
sole obligation and liability of Seller. In no event shall Seller be obligated
to pay for Purchaser's attorneys' fees or costs in connection with the
assumption of the Mortgages. Purchaser shall cooperate diligently and in good
faith to assist Seller in obtaining the Mortgagees' consents and in closing the
assumptions, at no cost to Purchaser. In the event that the applicable Mortgage
Documents provide for the Mortgagee to have the right to condition its consent
upon (a) certain non-material modifications to the applicable Mortgage, (b)
compliance with bankruptcy remoteness provisions or rating agency standards, or
(c) any conditions imposed by such Mortgagee in its sole discretion, Purchaser
shall agree to any reasonable requests made by a Mortgagee that do not have a
material adverse effect upon Purchaser.

                      (b) The consent from each Mortgagee (each, a "Mortgagee
Consent") shall contain the following:

                      (i)     the outstanding principal balance of the Property
                              Notes, the date through which interest has been
                              paid thereunder, the amount held by it in any
                              escrow accounts, and that aside from said
                              principal balance and any accrued interest
                              thereon, there are no other outstanding or accrued
                              amounts secured by the Mortgages;

                      (ii)    confirmation that there are no Mortgage Loan
                              Documents except as delivered to Purchaser as set
                              forth in Section 7.1(a)(xiv)(A); and confirmation
                              that the representations and warranties set forth
                              in Sections 7.1(a)(xiv)(B), (C) and (D); Section
                              7.1(a)(xix) and Section 7.1(a)(xx) are true,
                              accurate and correct in all material respects;

                      (iii)   that Mortgagee consents to the transfer by Seller
                              of the applicable Property to Purchaser or its
                              designated wholly owned subsidiary, without any
                              change in interest rate, payment schedule, or any
                              other modification of the Mortgage Loan Documents
                              not approved by Purchaser in its sole discretion;

                      (iv)    Mortgagee's approval of Purchaser's standard form
                              of lease (a copy of which has heretofore been
                              furnished to Seller);

                      (v)     Mortgagee's consent to the cancellation of any
                              existing management agreement, and to the
                              management of the applicable Property by either
                              Purchaser, Kimco Realty Corporation or any
                              subsidiary of Kimco Realty Corporation pursuant to
                              Purchaser's form management agreement, which shall
                              be substantially in the form annexed hereto as
                              Exhibit "M";


                                       42
<PAGE>

                      (vi)    Mortgagee's acknowledgement and agreement that
                              from and after the Closing neither of the
                              following would constitute an event of default
                              under any Mortgage Loan Documents or otherwise
                              result in any liability or obligation for
                              Purchaser thereunder: (A) any bankruptcy,
                              dissolution, insolvency, attachment, failure to
                              file financial statements, or other event or
                              occurrence involving either Seller (or any
                              guarantor of Seller's obligations under the Loan
                              Documents); or (B) any breach of any
                              representation, warranty or undertaking under any
                              Loan Document occurring or accruing prior to the
                              Closing Date (unless and to the extent that same
                              directly relates to the Property, continues after
                              Closing, and the failure to cure same by Purchaser
                              would constitute a continuing default under the
                              Mortgage Loan Documents);

                      (vii)   that as long as the Purchaser owns the applicable
                              Property and insurance is provided by a blanket
                              KIMCO policy (and as long as there exist no other
                              defaults under the applicable Mortgage Documents),
                              the Mortgagee would waive the requirement of an
                              insurance escrow; and

                      (viii)  that either of the following will be permitted
                              without Mortgagee's consent and without charge:
                              (A) admission of additional limited partners to
                              Purchaser and/or changes in the percentages among
                              existing limited partners therein; or (B) a public
                              offering of Kimco Income Reit, the general partner
                              of Purchaser.

                      (c) In the event that a Mortgagee's consent containing the
above provisions is not obtained prior to the expiration of the Closing Period,
despite the good faith efforts of both Seller and Purchaser, then the failure to
obtain such consent shall be treated as a failure of a closing condition, and
the Property for which consent has not been obtained shall be treated as a
Post-Closing Property, subject to the provisions of Section 9, including without
limitation, the Cure Period provisions of Section 9.3(c).

                      (d) Seller shall cause each Mortgagee to deliver an update
of its consent, not more than twenty (20) days prior to the Closing, confirming
(or updating, as the case may be) the information set forth in Section
18.2(b)(i) and confirming that the Mortgagee has not delivered a notice of
default to Seller (each, a "Mortgagee Payoff Update").

                  18.3 Additionally, the parties acknowledge that certain of the
Properties are currently encumbered by that certain $100,000,000.00 Revolving
Line of Credit with Prudential Securities Incorporated ("Prudential"). Purchaser
shall have the right to request that Prudential cooperate in the assignment to
Purchaser's lender by Prudential of additional mortgages securing said line of
credit borrowings (the "Credit Mortgages"); provided, that such request or the
assignment contemplated therein does not in any way adversely affect the tax
planning of Sellers, any Group


                                       43
<PAGE>

B Sellers or any unit holders in Philips (as defined below). In such event, (a)
the amount set forth in Section 2.1(a)(iii) hereof shall be reduced by the
amount of debt actually assigned to Purchaser's lender, and (b) any and all
costs and expenses arising out of or relating to the assignments of the Credit
Mortgages (including, without limitation, prepayment penalties, if any,
assumption fees, if any, Prudential's attorney's fees and expenses, Prudential's
representative's fees (for example, and not by way of limitation, fees for
attending the Closing, if necessary), Purchaser's attorneys' fees or costs, and
recording fees and costs) shall be the sole obligation and liability of
Purchaser. Seller shall cooperate diligently and in good faith, at Purchaser'
sole cost and expense, to assist Purchaser in obtaining Prudential's consent to
and in closing the assignments of the Credit Mortgages.

         Section 19.  Escrow

                  19.1 Escrow Agent shall hold the Downpayment and all interest
accrued thereon, if any (collectively, the "Fund") in escrow and shall dispose
of the Fund only in accordance with the provisions of this Section 19.

                  19.2 Escrow Agent shall deliver the Fund to Seller or
Purchaser, as the case may be, as follows:

                      (a) to Seller, upon completion of the Closing; or

                      (b) to Seller, after receipt of Seller's demand in which
Seller certifies that Purchaser has defaulted under this Agreement, but Escrow
Agent shall not honor Seller's demand until more than ten (10) days after Escrow
Agent has given a copy of Seller's demand to Purchaser in accordance with
Section 19.3(a), nor thereafter if Escrow Agent receives a Notice of Objection
from Purchaser within such ten (10) day period; or

                      (c) to Purchaser, after receipt of Purchaser's demand in
which Purchaser certifies either that (i) Seller has defaulted under this
Agreement, or (ii) this Agreement has been otherwise terminated or canceled, and
Purchaser is thereby entitled to receive the Fund; but Escrow Agent shall not
honor Purchaser's demand until more than ten (10) days after Escrow Agent has
given a copy of Purchaser's demand to Seller in accordance with Section 19.3(a),
nor thereafter if Escrow Agent receives a Notice of Objection from Seller within
such ten (10) day period. Notwithstanding the foregoing, if Purchaser terminates
this Agreement prior to the expiration of the Inspection Period, Escrow Agent
shall, immediately upon receipt of Purchaser's demand, deliver the Fund to
Purchaser.

Upon delivery of the Fund, Escrow Agent shall be relieved of all liability
hereunder and with respect to the Fund. Escrow Agent shall deliver the Fund, at
the election of the party entitled to receive the same, by a bank wire transfer
of immediately available funds to an account designated by such party.

                  19.3 (a) Upon receipt of a written demand from Seller or
Purchaser under Section 19.2(b) or (c), except in the event of a demand which
states that Purchaser has terminated


                                       44
<PAGE>

the Agreement prior to the expiration of the Inspection Period, Escrow Agent
shall send a copy of such demand to the other party. Within ten (10) days after
the date of receiving same, but not thereafter, the other party may object to
delivery of the Fund to the party making such demand by giving a notice of
objection (a "Notice of Objection") to Escrow Agent. After receiving a Notice of
Objection, Escrow Agent shall send a copy of such Notice of Objection to the
party who made the demand; and thereafter, in its sole and absolute discretion,
Escrow Agent may elect either (i) to continue to hold the Fund until Escrow
Agent receives a written agreement of Purchaser and Seller directing the
disbursement of the Fund, in which event Escrow Agent shall disburse the Fund in
accordance with such agreement; and/or (ii) to take any and all actions as
Escrow Agent deems necessary or desirable, in its sole and absolute discretion,
to discharge and terminate its duties under this Agreement (other than paying
the Fund to one of the parties), including, without limitation, depositing the
Fund into any court of competent jurisdiction and bringing any action of
interpleader or any other proceeding; and/or (iii) in the event of any
litigation between Seller and Purchaser, to deposit the Fund with the clerk of
the court in which such litigation is pending.

                      (b) If Escrow Agent is uncertain for any reason whatsoever
as to its duties or rights hereunder (and whether or not Escrow Agent has
received any written demand under Section 19.2(b) or (c), or Notice of Objection
under Section 19.3(a)), notwithstanding anything to the contrary herein, Escrow
Agent may hold and apply the Fund pursuant to Section 19.3(a)(i), (ii) or (iii)
and may decline to take any other action whatsoever. In the event the Fund is
deposited in a court by Escrow Agent pursuant to Section 19.3(a)(ii) or (iii),
Escrow Agent shall be entitled to rely upon the decision of such court. In the
event of any dispute whatsoever among the parties with respect to disposition of
the Fund, Purchaser and Seller shall pay the reasonable attorney's fees and
costs incurred by Escrow Agent (which said parties shall share equally, but for
which said parties shall be jointly and severally liable) for any litigation in
which Escrow Agent is named as, or becomes, a party.

                  19.4 Notwithstanding anything to the contrary in this
Agreement, within one (1) business day after the date of this Agreement, Escrow
Agent shall place the Downpayment in an Approved Investment. The interest, if
any, which accrues on such Approved Investment shall be deemed part of the Fund;
and Escrow Agent shall dispose of such interest as and with the Fund pursuant to
this Agreement. Escrow Agent may not commingle the Fund with any other funds
held by Escrow Agent. Escrow Agent may convert the Fund from the Approved
Investment into a non-interest-bearing demand account at an Approved Institution
as follows:

                      (a) at any time within three (3) days prior to the Closing
Date; or

                      (b) if the Closing Date is accelerated or extended, at any
time within three (3) days prior to the accelerated or extended Closing Date;
provided, however, that Seller and Purchaser shall give Escrow Agent timely
notice of any such acceleration or extension and that Escrow Agent may hold the
Fund in a non-interest-bearing deposit account if Seller and Purchaser do not
give Escrow Agent timely notice of any such adjournment.

                  19.5 As used herein, the term "Approved Investment" means (a)
any interest-bearing demand account or money market fund in [Citibank, N.A.]
located in the City of New


                                       45
<PAGE>

York or in any other institution otherwise approved by both Seller and Purchaser
(collectively, an "Approved Institution"), or (b) any other investment approved
by both Seller and Purchaser. The rate of interest or yield need not be the
maximum available and deposits, withdrawals, purchases, reinvestment of any
matured investment and sales shall be made in the sole discretion of Escrow
Agent, which shall have no liability whatsoever therefor. Discounts earned shall
be deemed interest for the purpose hereof.

                  19.6 Escrow Agent shall have no duties or responsibilities
except those set forth herein, which the parties hereto agree are ministerial in
nature. Seller and Purchaser acknowledge that Escrow Agent is serving without
compensation, solely as an accommodation to the parties hereto, and except for
Escrow Agent's own willful default, misconduct or gross negligence, Escrow Agent
shall have no liability of any kind whatsoever arising out of or in connection
with its activity as Escrow Agent. Seller and Purchaser jointly and severally
agree to and do hereby indemnify and hold harmless Escrow Agent from all loss,
cost, claim, damage, liability, and expense (including reasonable attorney's
fees and disbursements whether paid to retained attorneys or representing the
fair value of legal services rendered to itself) which may be incurred by reason
of its acting as Escrow Agent provided the same is not the result of Escrow
Agent's willful default, misconduct or gross negligence. Escrow Agent may charge
against the Fund any amounts owed to it under the foregoing indemnity or may
withhold the delivery of the Fund as security for any unliquidated claim, or
both.

                  19.7 Any Notice of Objection, demand or other notice or
communication which may or must be sent, given or made under this Agreement to
or by Escrow Agent shall be sent in accordance with the provisions of Section
22.

                  19.8 Simultaneously with their execution and delivery of this
Agreement, Purchaser and Seller shall furnish Escrow Agent with their true
Federal Taxpayer Identification Numbers so that Escrow Agent may file
appropriate income tax information returns with respect to any interest in the
Fund or other income from the Approved Investment. The party ultimately entitled
to any accrued interest in the Fund shall be the party responsible for the
payment of any tax due thereon.

                  19.9 Seller and Purchaser waive any claim of conflict of
interest by reason of Escrow Agent's actions in that capacity under this
Agreement. Purchaser hereby acknowledges that Escrow Agent is the attorney for
the Seller, and agrees that Escrow Agent may represent Seller in connection with
any and all matters, including without limitation, the transaction contemplated
by this Agreement and any litigation, including any action arising out of this
Agreement; provided that in no event shall Purchaser be responsible for payment
of any fees incidental to any such representation.

                  19.10 Any amendment of this Agreement which could alter or
otherwise affect Escrow Agent's obligations hereunder will not be effective
against or binding upon Escrow Agent without Escrow Agent's prior consent, which
consent may be withheld in Escrow Agent's sole and absolute discretion.


                                       46
<PAGE>

                  19.11 The provisions of this Section 19 shall survive the
termination of this Agreement and the Closing.

         Section 20. Assignment

                  20.1 Purchaser shall not assign all or any portion of its
rights under this Agreement to any person or entity without the prior written
consent of Seller, which consent may be withheld in Seller's sole and absolute
discretion. Any assignment or attempted assignment by Purchaser shall constitute
a default by Purchaser hereunder and shall be null and void. Notwithstanding the
foregoing, provided that it does not delay the Closing, Purchaser shall have the
right, upon delivery of written notice to Seller, not less than three (3)
business days prior to the Closing (or earlier if required by any Mortgagee), to
assign all or any portion of its rights under this Agreement (including the
right to designate a separate entity to take title to each Property) to an
affiliate of Purchaser or an affiliate of Kimco Realty Corporation provided that
such assignee shall, in writing, agree to assume Purchaser's obligations
hereunder with respect to the applicable Property (or Ground Lease). For the
purposes of this section, (a) an affiliate shall be any entity which directly
controls, is controlled directly by, or is under direct common control with
Purchaser or Kimco Realty Corporation; and (b) control means the possession of
the exclusive right or power to direct or cause the direction of the management,
business and policies of an entity, whether by contract or otherwise.

         Section 21. Access to Records

                  21.1 For a period of five (5) years subsequent to the Closing
Date, Seller, Seller's Affiliates and their employees, agents and
representatives shall be entitled to access during business hours to all
documents, books and records given to Purchaser by Seller at the Closing for tax
and audit purposes, regulatory compliance, and cooperation with governmental
investigations upon reasonable prior notice to Purchaser, and shall have the
right, at its sole cost and expense, to make copies of such documents, books and
records.

                  21.2 Following Closing, Seller shall, upon request, give
Purchaser access to Seller's books and records with respect to the operation of
each Property (and Ground Lease) for the calendar year in which Closing occurs
and for the previous calendar year for purposes of verifying collections and
remittances and the preparation by Purchaser of financial statements and reports
with respect to such Property (and Ground Lease). Such books and records shall
be made available to Purchaser at reasonable times and upon reasonable advance
notice to Seller and without any expense to Seller or charge to Purchaser. This
Section 21.2 shall survive the Closing.

         Section 22. Notices

                  22.1 All notices, elections, consents, approvals, demands,
objections, requests or other communications which Seller, Purchaser or Escrow
Agent may be required or desire to give pursuant to, under or by virtue of this
Agreement must be in writing and shall be sent (a) by first class U.S. certified
or registered mail, return receipt requested, with postage prepaid; (b) by


                                       47
<PAGE>

depositing the same into the custody of a nationally recognized overnight
delivery service such as Federal Express Corporation, Airborne Express, Emery or
Purolator for next day delivery; (c) by same-day hand delivery with proof of
service endorsed thereon; or (d) by telecopier, provided it is also delivered by
express mail or courier (for next business day delivery). All such notices,
elections, consents, approvals, demands, objections, requests or other
communications sent in compliance with the provisions hereof shall be deemed
given and received on (i) the second business day following the date it is
deposited in the U.S. mail, (ii) the date it is delivered to the other party if
sent by U.S. Express Mail, overnight delivery or hand delivery or (iii) the date
it is delivered to the other party if sent by telecopier provided it is
confirmed by express mail or courier (for next business day delivery). From time
to time either party may designate another address or addresses for all purposes
of this Agreement by a notice given to all other parties in accordance with the
provisions hereof. For purposes of this Section 22.1, the addresses of the
parties shall be as follows:

If to Seller:

         c/o Philips International Realty Corp.
         417 Fifth Avenue, Third Floor
         New York, New York 10016
         Attention:  Mr. Louis J. Petra
         Fax:  (212) 545-1355

with a copy to:

         Pryor Cashman Sherman & Flynn LLP
         410 Park Avenue, 10th Floor
         New York, New York 10022
         Attention: Jonathan A. Bernstein, Esq.
         Fax:  (212) 326-0806

If to Purchaser:

         Kimco Income Operating Partnership, L.P.
         3333 New Hyde Park Road, Suite 100
         New Hyde Park, New York 11042-0020
         Attention: Milton Cooper
         Fax:  (516) 869-7117

with a copy to:

         Kimco Realty Corporation
         3333 New Hyde Park Road, Suite 100
         New Hyde Park, New York 11042-0020
         Attention: Bruce Kauderer, Esq.
         Fax:  (516) 869-7256


                                       48
<PAGE>

If to Escrow Agent:

         Pryor Cashman Sherman & Flynn LLP
         410 Park Avenue, 10th Floor
         New York, New York 10022
         Attention: Stephen G. Epstein, Esq.
         Fax:  (212) 326-0806

                  22.2 Seller, Purchaser or Escrow Agent may designate another
addressee or change its address for notices and other communications hereunder
by a notice given to the other parties in the manner provided in this Section
22.

                  22.3 Notices and other communications given by, respectively,
Seller or Purchaser shall be deemed given by, respectively, Seller or Purchaser.

         Section 23. Property Information and Confidentiality

                  23.1 Purchaser agrees that, prior to the Closing, all Property
Information (as defined below) shall be kept strictly confidential and shall
not, without the prior consent of Seller, be disclosed by Purchaser or
Purchaser's Representatives, in any manner whatsoever, in whole or in part, and
will not be used by Purchaser or Purchaser's Representatives, directly or
indirectly, for any purpose other than evaluating the Group A Portfolio.
Moreover, Purchaser agrees that, prior to the Closing, the Property Information
will be transmitted only to prospective tenants for the Group A Portfolio and/or
Purchaser's Representatives, in each case, (i) who need to know the Property
Information for the purpose of evaluating the Group A Portfolio, and who are
informed by the Purchaser of the confidential nature of the Property Information
and (ii) who agree to be bound by the terms of this Section 23 and Section 13.3
(each, a "Permitted Recipient"). The provisions of this Section 23.1 shall in no
event apply to Property Information (a) which is a matter of public record; (b)
which became available to Purchaser on a non-confidential basis from a source
other than Seller or its representatives, which source was, in turn, not subject
to confidentiality restrictions; or (c) which, if not disclosed by Purchaser,
would prevent Purchaser from complying with Laws, including, without limitation,
governmental regulatory, disclosure, tax and reporting requirements.

                  23.2 Purchaser and Seller, for the benefit of each other,
hereby agree that between the date hereof and the Closing Date, they will not
release or cause or permit to be released any press notices, publicity (oral or
written) or advertising promotion relating to, or otherwise announce or disclose
or cause or permit to be announced or disclosed, in any manner whatsoever, the
terms, conditions or substance of this Agreement or the transactions
contemplated herein, without first obtaining the written consent of the other
party hereto. It is understood that the foregoing shall not preclude either
party from discussing the substance or any relevant details of the transactions
contemplated in this Agreement, subject to the terms of Section 23.1, with any
of its or its partners' attorneys, accountants, professional consultants or
potential lenders, as the case may be, or prevent either party hereto from
complying with Laws,


                                       49
<PAGE>

including, without limitation, governmental regulatory, disclosure, tax and
reporting requirements.

                  23.3 Purchaser shall indemnify and hold Seller and Seller's
Affiliates harmless from and against any and all claims, demands, causes of
action, losses, damages, liabilities, costs and expenses (including, without
limitation, attorneys' fees and disbursements) suffered or incurred by Seller or
any of Seller's Affiliates and arising out of or in connection with a breach by
Purchaser or Purchaser's Representatives of the provisions of this Section 23.

                  23.4 In the event this Agreement is terminated, Purchaser and
Purchaser's Representatives shall, promptly upon receipt of written request,
deliver to Seller all originals and copies of the Property Information referred
to in clause (a) of Section 23.5 in the possession of Purchaser and Purchaser's
Representatives.

                  23.5 As used in this Agreement, the term "Property
Information" shall mean (a) all information and documents in any way relating to
the Group A Portfolio, the operation thereof or the sale thereof (including,
without limitation, loan documents relating to the Note and the Mortgage,
Leases, service contracts and Licenses) furnished to, or otherwise made
available for review by, Purchaser or its directors, officers, employees,
affiliates, partners, brokers, agents or other representatives, including
attorneys, accountants, contractors, consultants, engineers and financial
advisors or its partners (collectively, "Purchaser's Representatives"), by
Seller or any of Seller's Affiliates, or their agents or representatives,
including their contractors, engineers, attorneys, accountants, consultants,
brokers or advisors, and (b) all analyses, compilations, data, studies, reports
or other information or documents prepared or obtained by Purchaser or
Purchaser's Representatives containing or based on, in whole or in part, the
information or documents described in the preceding clause (a), or the
Investigations, or otherwise reflecting their review or investigation of the
Group A Portfolio.

                  23.6 In addition to any other remedies available to Seller,
Seller shall have the right to seek equitable relief; including injunctive
relief or specific performance, against Purchaser or Purchaser's Representatives
in order to enforce the provisions of this Section 23.

                  23.7 The provisions of this Section 23 shall survive the
termination of this Agreement.

         Section 24. Miscellaneous

                  24.1 No Oral Modifications. This Agreement shall not be
altered, amended, changed, waived, terminated or otherwise modified in any
respect or particular, and no consent or approval required pursuant to this
Agreement shall be effective, unless the same shall be in writing and signed by
or on behalf of the party to be charged.

                  24.2 Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and to their
respective heirs, executors, administrators, successors and permitted assigns.


                                       50
<PAGE>

                  24.3 Integration; Construction. All prior statements,
understandings, representations and agreements between the parties, oral or
written, are superseded by and merged in this Agreement, which alone fully and
completely expresses the agreement between them in connection with this
transaction and which is entered into after full investigation, neither party
relying upon any statement, understanding, representation or agreement made by
the other not embodied in this Agreement. This Agreement shall be given a fair
and reasonable construction in accordance with the intentions of the parties
hereto, and without regard to or aid of canons requiring construction against
Seller or the party drafting this Agreement.

                  24.4 Merger. Except as otherwise expressly provided herein (or
as the context hereof may reasonably require), Purchaser's acceptance of the
Deed and execution and delivery of the Ground Lease Assignment shall be deemed a
discharge of all of the obligations of Seller hereunder (except those which are
to be performed following Closing) and all of Seller's representations,
warranties, covenants and agreements herein shall merge in the documents and
agreements executed at the Closing and shall not survive the Closing.

                  24.5 Limitation of Liability; Seller's Affiliates. (a)
Notwithstanding any language to the contrary contained herein (whether or not
any provision contained herein is expressly stated to be subject to this Section
24.5), (i) Purchaser shall not have a right to bring a post-Closing claim
against Seller by virtue of a breach of any of Seller's obligations hereunder
(including without limitation, Sections 3.6 and 7, a default under the Group B
Agreement, breach of any representations, warranties or covenants under this
Agreement or any Closing Document, any indemnification obligation and/or
otherwise under this Agreement or any Closing Document) unless (A) such claim is
brought on or prior to December 31, 2000 (time being of the essence); (B) Seller
has received written notice of such breach (together with a description of the
nature of such breach) prior to the earlier to occur of (x) December 31, 2000,
or (y) ten (10) days after the date that Purchaser first knows about such
breach, and Seller has had a reasonable opportunity to cure same; and (C) the
aggregate damages to Purchaser resulting from all such breaches, in the
aggregate across the Group A Portfolio and across the Group B Agreement (and
Portfolio), are reasonably expected to exceed $100,000.00; and (ii) Sellers'
maximum post-Closing liability for such breaches, in the aggregate across the
Group A Portfolio and under the Group B Agreement, shall in no event exceed a
maximum amount of $2,500,000.00. Additionally, Purchaser agrees to first seek
recovery against any applicable insurance policies and/or Leases prior to
seeking recovery against Seller, and Seller shall not be liable to Purchaser if
Purchaser's claim is satisfied out of same; provided that, if Seller receives
written notice from Purchaser that Purchaser has commenced a claim under any
applicable insurance policies and/or Leases, the time period within which
Purchaser must bring a post-Closing claim against Seller shall be tolled during
the pendency of such claim. The provisions of this Section 24.5 shall survive
the Closing and the execution and delivery of the Deed (or Ground Lease
Assignment). Therefore, the Sellers total liability to Purchaser shall equal the
amount up to $2,500,000.00 and in excess of $100,000.00.

                      (b) To the extent there is a failure of a Closing
condition and Purchaser waives such closing conditions and closes on the
affected Property (or Ground Lease), Purchaser hereby expressly waives,
relinquishes and releases all other rights on remedies


                                       51
<PAGE>

available to it at law, in equity or otherwise (including, without limitation,
the right of such damages from Seller) as a result of the Seller failing to
comply with the closing condition. Notwithstanding the foregoing, Seller shall
continue to be obligated to promptly remit to Purchaser any condemnation or
casualty proceeds actually received by Seller post-Closing.

                      (c) Notwithstanding anything in this Agreement to the
contrary, Purchaser agrees that it does not have and will not have any claims or
causes of action against any disclosed or undisclosed officer, director,
employee, trustee, shareholder, partner, principal, parent, subsidiary or other
affiliate of Seller (collectively, "Seller's Affiliates"), arising out of or in
connection with this Agreement or the transactions contemplated hereby.
Purchaser agrees to look solely to Seller and its assets for the satisfaction of
any liability or obligation arising under this Agreement or the transactions
contemplated hereby, or for the performance of any of the covenants, warranties
or other agreements contained herein, and further agrees not to sue or otherwise
seek to enforce any personal obligation against any of Seller's Affiliates with
respect to any matters arising out of or in connection with this Agreement or
the transactions contemplated hereby. Without limiting the generality of the
foregoing provisions of this Section 24.5, Purchaser hereby unconditionally and
irrevocably waives any and all claims and causes of action of any nature
whatsoever it may now or hereafter have against Seller's Affiliates, and hereby
unconditionally and irrevocably releases and discharges Seller's Affiliates from
any and all liability whatsoever which may now or hereafter accrue in favor of
Purchaser against Seller's Affiliates, in connection with or arising out of this
Agreement or the transactions contemplated hereby. The provisions of this
Section 24.5 shall survive the termination of this Agreement and the Closing.

                  24.6 Attachments. Each of the Exhibits and Schedules referred
to herein and attached hereto is an integral part of this Agreement and is
hereby incorporated in this Agreement by this reference.

                  24.7 No Waiver. No failure or delay of either party in the
exercise of any right or remedy given to such party hereunder or the waiver by
any party of any condition hereunder for its benefit (unless the time specified
herein for exercise of such right or remedy has expired) shall constitute a
waiver of any other or further right or remedy nor shall any single or partial
exercise of any right or remedy preclude other or further exercise thereof or
any other right or remedy. No waiver by either party of any breach hereunder or
failure or refusal by the other party to comply with its obligations shall be
deemed a waiver of any other or subsequent breach, failure or refusal to so
comply.

                  24.8 No Memorandum. Neither this Agreement nor any memorandum
thereof shall be recorded and any attempted recordation hereof shall be void and
shall constitute a default.

                  24.9 Counterparts. This Agreement may be executed in one or
more counterparts, each of which so executed and delivered shall be deemed an
original, but all of which taken together shall constitute but one and the same
instrument.


                                       52
<PAGE>

                  24.10 Captions. The caption headings in this Agreement are for
convenience only and are not intended to be a part of this Agreement and shall
not be construed to modify, explain or alter any of the terms, covenants or
conditions herein contained.

                  24.11 Governing Law. This Agreement shall be interpreted and
enforced in accordance with the laws of the State of New York without reference
to principles of conflicts of laws.

                  24.12 Dates. If the last day of the period prescribed herein
for the giving of any notice, election, consent, approval, demand, objection or
request or the submission of any documents by any party hereunder shall fall on
a Saturday, Sunday or any day observed as a public holiday by the federal
government or the state in which any of the Properties is situated, then such
period shall be deemed to be extended to the immediately following day which is
not a Saturday, Sunday or such public holiday. The term "business day" as used
in this Agreement shall mean any day other than Saturday, Sunday or any day
observed as a public holiday by the federal government or the state in which
such Property is situated.

                  24.13 General. Unless otherwise specified herein, (a)
references to persons or parties include their permitted successors and assigns;
(b) references to modifications or amendments shall in all events mean
modifications and amendments; (c) references to statutes are to be construed as
including all rules and regulations adopted pursuant to the statute referred to
and all statutory provisions consolidating, amending or replacing the statute
referred to; (d) references to agreements and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto entered into from time to time after the date hereof to satisfy the
requirements of this Agreement or otherwise with Seller's prior written consent;
(e) references to a mortgage shall be deemed to mean or include a deed of trust,
depending on the jurisdiction in which the applicable Property is located; (f)
the words "include" or "including", and words of similar import, shall be deemed
to be followed by the words "but not limited to" or "without limitation"; (g)
the words "hereto", "herein", "hereof' and "hereunder", and words of similar
import, refer to this Agreement in its entirety; and (h) unless otherwise
specified herein, all references to Sections are to Sections of this Agreement.
Terms defined herein may be used in the singular or the plural; when used in the
singular and preceded by "a", "an" or "any", such term shall be taken to
indicated one or more members of the relevant class; and when used in the
plural, such term shall be taken to indicate all members of the relevant class.

                  24.14 Severability. If any provision of this Agreement shall
be unenforceable or invalid, the same shall not affect the remaining provisions
of this Agreement and to this end the provisions of this Agreement are intended
to be and shall be severable. Notwithstanding the foregoing sentence, if (a) any
provision of this Agreement is finally determined by a court of competent
jurisdiction to be unenforceable or invalid in whole or in part, (b) the
opportunity for all appeals of such determination have expired, and (c) such
unenforceability or invalidity alters the substance of this Agreement (taken as
a whole) so as to deny either party, in a material way, the realization of the
intended benefit of its bargain, such party may terminate this Agreement within
thirty (30) days after the final determination by notice to the other. If such
party so elects


                                       53
<PAGE>

to terminate this Agreement, then this Agreement shall be terminated and neither
party shall have any further rights, obligations or liabilities hereunder,
except for the Surviving Obligations, and except that Purchaser shall be
entitled to a return of the Downpayment (together with all interest accrued
thereon, if any).

                  24.15 WAIVER OF JURY TRIAL. SELLER AND PURCHASER HEREBY WAIVE
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER ARISING IN TORT
OR CONTRACT) BROUGHT BY EITHER AGAINST THE OTHER ON ANY MATTER ARISING OUT OF OR
IN ANY WAY CONNECTED WITH THIS AGREEMENT.

                  24.16 Further Assurances. Seller and Purchaser each agree to
do such further acts and things and to execute and deliver such additional
agreements and instruments as the other may reasonably require to consummate,
evidence or confirm the sale or any other agreement contained herein in the
manner contemplated hereby.

         Section 25. Group B Properties.

                  25.1 (a) Seller and Purchaser acknowledge that the parties
hereto are negotiating the sale and purchase of certain additional properties
(the "Group B Properties") set forth on Schedule 25.1 hereto, pursuant to a
separate agreement (the "Group B Agreement") among the "Group B Seller" and the
"Group B Purchaser." Purchaser acknowledges that its acquisition of the Group B
Properties by the Group B Purchaser constitutes an integral part of a planned
liquidation of Philips International Realty Corp. (the "REIT") and Philips
International Realty, L.P. ("Philips"). Accordingly, provided that this
Agreement is not terminated as expressly permitted herein prior to the
expiration of the Inspection Period, Purchaser agrees (a) to reasonably
cooperate and assist, at Sellers' expense, to the extent necessary in the
preparation and furnishing of information required to be incorporated into the
REIT's proxy statement, and (b) to proceed in good faith to acquire all the
Properties (and the Ground Lease) hereunder and all of the Group B Properties,
subject at all times to the terms and conditions of this Agreement and the Group
B Agreement. In the event that this Agreement is terminated as expressly
permitted herein, the Group B Agreement shall, without further action by the
parties hereto or thereto, be automatically terminated.

                  (b) In the event that Seller fails to obtain shareholder
approval for the sale of the Group B Properties to Purchaser, Purchaser shall
receive, in addition to the return of its good faith deposit under the Group B
Agreement (together with any interest earned thereon), the Break Up Fee, subject
to Section 16.3.

                  (c) Each party hereto acknowledges and agrees that a default
by such party under the Group B Agreement shall constitute a default of such
party under this Agreement, and a default by such party under this Agreement
shall constitute a default by such party under the Group B Agreement, in either
of which events the parties shall have the rights and remedies set forth in
Section 16. Additionally, Purchaser acknowledges and agrees that a termination
of the


                                       54
<PAGE>

Group B Agreement by Purchaser prior to the expiration of the due diligence
period thereunder shall constitute a termination of this Agreement pursuant to
Section 17.2.

         Section 26. Legal Descriptions. It is the intention of the Sellers to
convey to Purchaser all of Sellers' respective right title and interest in and
to the Properties (and the Ground Lease) set forth on Schedule 1 hereto. In the
event that the Title Company advises Purchaser that Seller owns more real
property at any of the Properties (or the Ground Lease) set forth on Schedule 1
than what is set forth in the respective legal descriptions attached hereto as
Schedules 1.1 - 1.7, Seller shall, upon receipt of appropriate evidence of same,
convey any such additional real property to Purchaser by quit claim deed.
Notwithstanding the foregoing, (a) in the event that any of the legal
descriptions attached hereto as Schedules 1.1 - 1.7 omits real property
contained in a recorded deed to Seller, Seller shall (to the extent that Seller
has not, prior to the date of this Agreement, conveyed such Property (or Ground
Lease) to another party) include the legal description from such recorded deed
in the legal description contained in the bargain and sale deed (or Ground Lease
assignment) required under Section 10.1 of the Agreement; and (b) in the event
that the any of the legal descriptions attached hereto as Schedules 1.1 - 1.7
includes real property contained in a recorded deed from Seller to a party other
than Purchaser, Seller shall, to the extent that such recorded deed is dated
prior to the date of this Agreement, exclude the legal description in such
recorded deed from the legal description contained in the bargain and sale deed
(or Ground Lease assignment) required under Section 10.1 of the Agreement.


                      [SIGNATURES APPEAR ON FOLLOWING PAGE]


                                       55
<PAGE>

                  IN WITNESS WHEREOF, this Agreement has been duly executed by
the parties hereto as of the day and year first above written.

                  SELLERS:

                           MUNSEY PARK ASSOCIATES, LLC, a New York
                             limited liability company
                           BY: Munsey Park Management, LLC, its managing member

                                By:  Philips International Realty Corp., a
                                     Maryland corporation, its sole member

                                        By: /s/ Louis J. Petra
                                           -------------------------------------
                                           Name:  Louis J. Petra
                                           Title: President

                           NORTH SHORE TRIANGLE, LLC, a New York
                             limited liability company
                           BY: Philips Glen Cove LLC, its sole member

                                By:  Philips International Realty, L.P., a
                                     Delaware limited partnership, its sole
                                     member

                                        By: Philips International Realty Corp.,
                                            a Maryland corporation, its general
                                            partner

                                               By: /s/ Louis J. Petra
                                                  ------------------------------
                                                  Name:  Louis J. Petra
                                                  Title: President


                           PHILIPS YONKERS, LLC, a New York limited liability
                              company
                           BY:  Philips International Realty, L.P., a Delaware
                                limited partnership, its Managing Member

                                   By: Philips International Realty Corp., a
                                       Maryland corporation, its general partner

                                          By: /s/ Louis J. Petra
                                             -----------------------------------
                                             Name:  Louis J. Petra
                                             Title: President

<PAGE>

                           PHILIPS HENRY, LLC, a Delaware limited liability
                              company
                           BY: Philips International Realty, L.P., a Delaware
                               limited partnership, its sole member

                                  By: Philips International Realty Corp., a
                                      Maryland corporation, its general partner

                                         By: /s/ Louis J. Petra
                                            ------------------------------------
                                            Name:  Louis J. Petra
                                            Title: President

                           PHILIPS SHOPPING CENTER FUND, L.P., a Delaware
                               limited partnership

                           BY: Philips Fund GP Corp., its general partner

                                  By: /s/ Louis J. Petra
                                     -------------------------------------------
                                     Name:  Louis J. Petra
                                     Title: President


                           PHILIPS LAKE MARY ASSOCIATES, L.P., a
                              Delaware limited partnership

                           BY: Philips Lake Mary Sub-VIII, Inc., its general
                               partner

                                  By: Philips International Realty Corp., a
                                      Maryland corporation, its sole shareholder

                                         By: /s/ Louis J. Petra
                                            ------------------------------------
                                            Name:  Louis J. Petra
                                            Title: President




                  PURCHASER:

<PAGE>

                           KIMCO INCOME OPERATING PARTNERSHIP, L.P.,
                              a Delaware limited partnership

                           BY: Kimco Income Reit, its general partner

                                By: /s/ Bruce M. Kauderer
                                   ---------------------------------------------
                                   Name:  Bruce M. Kauderer
                                   Title: Vice President



Solely for the purpose of
agreeing to the provisions of Section 19:

Pryor Cashman Sherman & Flynn LLP, Escrow Agent


By: /s/ Blake Hornick
   ------------------------------------

   Print Name: Blake Hornick
              -------------------------


<PAGE>


                         LIST OF SCHEDULES AND EXHIBITS
                         ------------------------------

Schedule
--------

1              Group A Portfolio
1.1            Legal Description - Munsey Park
1.2            Legal Description - Glen Cove
1.3            Legal Description - Yonkers
1.4            Legal Description - Freeport
1.5            Legal Description - Orlando
1.6            Legal Description - Key Largo
1.7            Legal Description - Lake Mary
5.1            Permitted Encumbrances
7.1(a)(i)      Intentionally Deleted
7.1(a)(iv)     Leases
7.1.(a)(v)     Intentionally Deleted
7.1(a)(viii)   Intentionally Deleted
7.1(a)(xii)    Intentionally Deleted
7.1(a)(xv)     Tax Certiorari Proceedings
10.1(d)(ii)    Intentionally Deleted
10.1(n)        Required Estoppel Certificates
25.1           Group B Portfolio

<PAGE>


Exhibit
-------

A                                   Intentionally Deleted

B                                   Ground Lease Assignment

C                                   Lease Assignment

D                                   License and Intangible Property Assignment

E-1                                 REA Notice of Sale

E-2                                 Notice to Tenants of Sale

F-1                                 Ground Lease Estoppel

F-2                                 REA Estoppel

F-3                                 Estoppel Certificates

F-4                                 Glen Cove Estoppel

G                                   Intentionally Deleted

H                                   Intentionally Deleted

I                                   FIRPTA

J                                   Intentionally Deleted

K                                   Intentionally Deleted

L                                   Bill of Sale

M                                   Purchaser's Form of Management Agreement


<PAGE>


                                  SCHEDULE "1"
                                  ------------

                                GROUP A PORTFOLIO
                                -----------------

         PROPERTY                            SELLER
         --------                            ------

1.       Munsey Park, NY.....................Munsey Park Associates, LLC
2.       Glen Cove, NY.......................North Shore Triangle, LLC
3.       Yonkers, NY.........................Philips Yonkers, LLC*
4.       Freeport, NY (Henry Street).........Philips Henry, LLC
5.       Orlando, FL (Tradewinds)............Philips Shopping Center Fund, L.P.
6.       Key Largo, FL (Bay Hill)............Philips Shopping Center Fund, L.P.
7.       Lake Mary, FL.......................Philips Lake Mary Associates, L.P.


--------------
* Holder of a Ground Lessee Interest (all others are fee title holders)

<PAGE>


                                 SCHEDULE "1.1"
                                 --------------

                         LEGAL DESCRIPTION - MUNSEY PARK
                         -------------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.2"
                                 --------------

                          LEGAL DESCRIPTION - GLEN COVE
                          -----------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.3"
                                 --------------

                           LEGAL DESCRIPTION - YONKERS
                           ---------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.4"
                                 --------------

                          LEGAL DESCRIPTION - FREEPORT
                          ----------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.5"
                                 --------------

                           LEGAL DESCRIPTION - ORLANDO
                           ---------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.6"
                                 --------------

                          LEGAL DESCRIPTION - KEY LARGO
                          -----------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "1.7"
                                 --------------

                          LEGAL DESCRIPTION - LAKE MARY
                          -----------------------------

                                 [See attached.]


<PAGE>


                                 SCHEDULE "5.1"

                             PERMITTED ENCUMBRANCES

Purchaser shall take title to each Property (and the Ground Lease) subject to:

         1.    Present and future zoning laws, ordinances, resolutions, orders
               and regulations of all municipal, county, state or federal
               governments having jurisdiction over such Property (and the
               Yonkers Property) and the use of improvements thereon.

         2.    All covenants, restrictions, easements, encumbrances and
               agreements of record which do not materially and adversely affect
               the Property (or Yonkers Property.

         3.    Beams and beam rights and party walls and party wall agreements.

         4.    Such state of facts as are disclosed by those certain surveys
               referenced in Exhibit "A" hereto, and such state of facts as
               would be disclosed by a current, accurate survey of the
               applicable Property (and the Yonkers Property).

         5.    Such state of facts as a physical inspection of the applicable
               Property (and the Yonkers Property) and of the appurtenances,
               fixtures, equipment and personal property included in this sale
               would disclose.

         6.    The lien of any unpaid real estate taxes, water charges and sewer
               rents for the fiscal year(s) or other applicable period in which
               the Closing occurs, provided same are apportioned at the Closing
               in accordance with this Agreement.

         7.    Subject to Section 3.8 of this Agreement, (a) the lien of all
               unpaid assessments encumbering each Property (and the Yonkers
               Property) on the date of this Agreement, and installments
               thereof, due and payable on or after the Closing Date, and (b)
               the lien of all unpaid assessments which first encumber each
               Property (and the Yonkers Property) subsequent to the date of
               this Agreement, and installments thereof, whether due and payable
               prior to, on or after the Closing Date.

         8.    All liens and encumbrances resulting from the Investigations or
               any and all other activities undertaken by Purchaser or
               Purchaser's Representatives.

         9.    Rights, if any, of any utility company to construct and/or
               maintain lines, pipes, wires, cables, poles, conduits and
               distributions boxes and equipment in, over, under, and/or upon
               each Property (and the Yonkers Property) or any portion thereof.

         10.   Building codes and restrictions heretofore or hereafter adopted
               by any public agency.

         11.   Encroachments of stoops, areas, cellar, steps, trim, cornices,
               retaining walls, windows, window sills, ledges, fire escapes,
               doors, door caps, projecting air

<PAGE>

               conditioner units or equipment, hedges, railings, coping, cellar
               doors or fences, if any, upon any street, highway, sidewalk or
               adjoining premises; variations between record line and retaining
               walls; encroachments of adjoining premises upon the applicable
               Property (and the Yonkers Property).

         12.   Radio antenna and television antenna violations or violations
               arising out of tenant air conditioners.

         13.   Variations between the descriptions contained in Schedules "1.1
               through 1.7" of the Agreement and the tax map description of the
               applicable Property (and the Yonkers Property).

         14.   Right, lack of right or restricted right of any owner of any
               Property (and the Yonkers Property) to construct and/or maintain
               any vault or vaulted area in or under the sidewalks abutting the
               premises, any licensing statute, ordinance or regulation and the
               terms of any license pertaining thereto and any fees for vault
               space which may hereafter be assessed.

         15.   Right, lack of right or restricted right of any owner of any
               Property (and the Yonkers Property) to construct and/or maintain
               fuel tanks, coal chutes, electric transformers, sidewalk
               elevators, gratings, manholes, hoists or excavations under, in,
               upon or over any street, highway, sidewalk or adjoining property.

         16.   Leases and New Leases.

         17.   Intentionally Deleted.

         18.   Property Notes, Mortgages, and Mortgage Loan Documents.

         19.   The title exceptions attached hereto as Exhibit "B"; and any
               Schedule B-II exceptions raised by the Commitments and/or updates
               of such Commitments on or before the expiration of the Inspection
               Period, subject to the Agreement.

<PAGE>


                              SCHEDULE "7.1(a)(iv)"
                              ---------------------

                                     LEASES
                                     ------


<PAGE>


                              SCHEDULE "7.1(a)(xv)"
                              ---------------------

                           TAX CERTIORARI PROCEEDINGS
                           --------------------------


<PAGE>


                               SCHEDULE "10.1(n)"
                               ------------------

                         REQUIRED ESTOPPEL CERTIFICATES
                         ------------------------------


<PAGE>


                                 SCHEDULE "25.1"
                                 ---------------

                                GROUP B PORTFOLIO
                                -----------------

         PROPERTY                           SELLER
         --------                           ------
1.       Staten Island, New York            Philips Forest Associates, L.P.
2.       Merrick, New York                  Philips Merrick Associates, L.P.
3.       Freeport, New York                 Philips Meadowbrook Associates, L.P.
4.       Brooklyn, New York                 Philips Avenue U Associates, L.P.
5.       Branhaven, Connecticut             Philips Branhaven Associates, L.P.
6.       Enfield, Connecticut               Philips Enfield Associates, L.P.
7.       Delran, New Jersey                 Delran Shopping, L.L.C.
8.       Foxborough, Massachusetts          Foxborough Shopping, L.L.C.


<PAGE>


                                    EXHIBIT A
                                    ---------

                              INTENTIONALLY DELETED
                              ---------------------


<PAGE>


                                    EXHIBIT B
                                    ---------

                    ASSIGNMENT AND ASSUMPTION OF GROUND LEASE
                    -----------------------------------------

         ASSIGNMENT AND ASSUMPTION OF GROUND LEASE, dated as of _______________,
2000, between PHILIPS YONKERS, LLC, a New York limited liability company, having
an office at c/o Philips International Realty, L.P., 417 Fifth Avenue, Third
Floor, New York, New York 10016 ("Assignor") and _______________, a
_______________, having an office at ______________________ ("Assignee").

                                   WITNESSETH
                                   ----------

         WHEREAS, pursuant to that certain ground lease dated as of June 22,
1972 (as amended, the "Ground Lease"), a true and complete copy of which is
attached hereto as Exhibit "A", by and between Central Arcade Company, a
_________ partnership ("Ground Lessor"), and AVR Realty Corp., a New York
corporation, the predecessor-in-interest of Assignor, Assignor leased from
Ground Lessor the parcel of real property located in Yonkers, New York, as more
particularly described in the Ground Lease;

         WHEREAS, Assignor and Assignee are parties to that certain Purchase and
Sale Agreement dated as of __________, 2000 (the "Group A Agreement"), by and
among Assignor, as seller, certain other sellers and Assignee, as purchaser; and

         WHEREAS, pursuant to the Group A Agreement Assignor desires to assign,
and Assignee desires to accept, all of Assignor's right, title and interest in
and to the Ground Lease.

         NOW, THEREFORE, in consideration of the sum of Ten Dollars ($10.00) and
other good and valuable consideration paid by Assignee to Assignor, the mutual
receipt and legal sufficiency of which are hereby acknowledged, Assignor hereby
assigns, transfers and conveys to Assignee the following:

         ALL OF ASSIGNOR'S right, title and interest, as ground lessee, in and
to the Ground Lease, together with all of Yonkers' right, title and interest, if
any, in and to the following: (a) all buildings and other improvements situated
on the Yonkers Property (collectively, the "Yonkers Buildings"); (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights of Yonkers pertaining to the Yonkers Property and the Yonkers
Buildings; (c) all right, title and interest of Yonkers in and to the Leases (as
defined below), Intangible Property (as defined below), and Licenses (as defined
below); (d) all right, title and interest of Yonkers in and to any transferable
guaranties or warranties (to the extent transferable); (e) all right, title and
interest of Yonkers in and to the REAs (as defined below); (f) all right, title
and interest of Yonkers in and to all fixtures, machinery, equipment, supplies
and other articles of personal property attached or appurtenant to the Yonkers
Property or the Yonkers Buildings, or used in connection therewith
(collectively, the "Yonkers Personal Property"); (g) all oil, gas and mineral
rights of Yonkers, if any, in and to the Yonkers Property; (h) all right, title
and interest of

<PAGE>

Yonkers if any, in and to the trade names of the Yonkers Buildings; and (i) all
right, title and interest of Yonkers, if any, in and to all strips and gores,
all alleys adjoining the Yonkers Property, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the Yonkers
Property to the center line thereof and all right, title and interest of
Yonkers, if any, in and to any award made or to be made in lieu thereof and in
and to any unpaid award for any taking by condemnation or any damages to the
Yonkers Property or the Yonkers Buildings by reason of a change of grade of any
street, road or avenue.

         TO HAVE AND TO HOLD the same unto Assignee, its successors and assigns,
forever, from and after the date hereof, subject to the terms, covenants,
conditions and provisions of the Ground Lease.

         ASSIGNEE HEREBY ACCEPTS the foregoing assignment, and assumes and
agrees to perform all of the obligations of Assignor under the Ground Lease; and

         ASSIGNEE FURTHER AGREES, subject to any and all obligations of Assignor
under the Group A Agreement which expressly survive the Closing, to defend and
indemnify Assignor and any disclosed or undisclosed officer, director, employee,
trustee, shareholder, partner, principal, parent, subsidiary or other person or
entity affiliated with Assignor (collectively, "Assignor's Affiliates") against,
and to hold Assignor and Assignor's Affiliates harmless from, any and all
claims, demands, causes of action, losses, damages, liabilities, and costs and
expenses (including, without limitation, attorney's fees and disbursements),
whether foreseen or unforeseen, asserted against or incurred by Assignor or any
of Assignor's Affiliates in connection with or arising out of acts or omissions
of Assignee or its directors, officers, employees, affiliates, partners,
brokers, agents, contractors, consultants and/or representatives, or other
matters or occurrences (unless caused by Assignor) that take place, from and
after the date hereof relating to the Ground Lease.

         ASSIGNOR FURTHER AGREES, subject to any and all obligations of Assignee
under the Group A Agreement which expressly survive the Closing, to defend and
indemnify Assignee and any disclosed or undisclosed officer, director, employee,
trustee, shareholder, partner, principal, parent, subsidiary or other person or
entity affiliated with Assignee (collectively, "Assignee's Affiliates") against,
and to hold Assignee and Assignee's Affiliates harmless from, any and all
claims, demands, causes of action, losses, damages, liabilities, and costs and
expenses (including, without limitation, attorney's fees and disbursements),
whether foreseen or unforeseen, asserted against or incurred by Assignee or any
of Assignee's Affiliates in connection with or arising out of acts or omissions
of Assignor or its directors, officers, employees, affiliates, partners,
brokers, agents, contractors, consultants and/or representatives, or other
matters or occurrences (unless caused by Assignee) that took place, on or prior
to the date hereof relating to the Ground Lease. Notwithstanding the foregoing,
Assignor's liability hereunder shall be subject at all times to the limitations
on Seller's liability set forth in the Group A Agreement, including, without
limitation, the provisions of Sections 7.1(c); 13; 17; and 24.5.

         Except as expressly set forth herein or in the Group A Agreement,
Assignee hereby unconditionally and irrevocably waives any and all claims and
causes of action of any nature whatsoever it may now or hereafter have against
Assignor or Assignor's Affiliates, and hereby unconditionally and irrevocably
fully releases and discharges Assignor and Assignor's Affiliates

<PAGE>

from any and all liability whatsoever which may now or hereafter accrue in favor
of Assignee against Assignor or Assignor's Affiliates, in connection with or
arising out of the Ground Lease.

         This Assignment and Assumption of Ground Lease is made without any
covenant, warranty or representation by, or recourse against, Assignor or
Assignor's Affiliates of any kind whatsoever, except as expressly set forth
herein or in the Group A Agreement.

            [The remainder of this page is intentionally left blank.]


<PAGE>


         IN WITNESS WHEREOF, this Assignment and Assumption of Ground Lease has
been executed as of the date and year first above written.

                           ASSIGNOR:

                           PHILIPS YONKERS, LLC, a New York limited liability
                              company

                           BY: Philips International Realty, L.P., a Delaware
                               limited partnership, its sole member

                                   By: Philips International Realty Corp., a
                                       Maryland corporation, its general partner

                                          By:
                                             -----------------------------------
                                             Name:
                                             Title:

                           ASSIGNEE:


                           By:
                              ---------------------------------------
                               Name:
                               Title:


<PAGE>


                                    EXHIBIT C
                                    ---------

                       ASSIGNMENT AND ASSUMPTION OF LEASES
                       -----------------------------------
                              AND SECURITY DEPOSITS
                              ---------------------

         ASSIGNMENT AND ASSUMPTION OF LEASES AND SECURITY DEPOSITS, dated as of
_______________, 2000, between _______________, a _______________ corporation,
having an office at ________________________, ("Assignor") and _______________,
a _______________ corporation, having an office at ______________________
("Assignee").

                                   WITNESSETH
                                   ----------

         WHEREAS, pursuant to that certain Purchase and Sale Agreement dated as
of __________, 2000 (the "Group A Agreement"), by and among Assignor, as seller,
certain other sellers and Assignee, as purchaser, Assignor has this day sold and
conveyed to assignee the real property more particularly described in Schedule
"1" annexed hereto and made a part hereof (the "Premises").

         NOW, THEREFORE, in consideration of the sum of Ten Dollars ($10.00) and
other good and valuable consideration paid by Assignee to Assignor, the mutual
receipt and legal sufficiency of which are hereby acknowledged, Assignor hereby
assigns, transfers and conveys to Assignee the following:

         ALL OF ASSIGNOR'S right, title and interest, if any, as landlord in and
to (i) the leases, licenses and other occupancy agreements affecting the
Premises and all guarantees thereof set forth on Schedule "2" annexed hereto and
made a part hereof (collectively, the "Leases"), and (ii) the security deposits
made under the Schedule "3" annexed hereto and made a part hereof (collectively,
the "Security Deposits").

         TO HAVE AND TO HOLD the same unto Assignee, its successors and assigns,
forever, from and after the date hereof, subject to the terms, covenants,
conditions and provisions of the Leases.

         ASSIGNEE HEREBY ACCEPTS the foregoing assignment, acknowledges receipt
of the Security Deposits, assumes and agrees to perform all of the obligations
of Assignor under the Leases, accruing (unless otherwise required by the Leases)
from and after the date hereof, and agrees to hold or apply all of the Security
Deposits in accordance with the terms of the Leases under which the Security
Deposits were made; and

         ASSIGNEE FURTHER AGREES, subject to any and all obligations of Assignor
under the Group A Agreement which expressly survive the Closing, to defend and
indemnify Assignor and any disclosed or undisclosed officer, director, employee,
trustee, shareholder, partner, principal, parent, subsidiary or other person or
entity affiliated with Assignor (collectively, "Assignor's Affiliates") against,
and to hold Assignor and Assignor's Affiliates harmless from, any and all

<PAGE>

claims, demands, causes of action, losses, damages, liabilities, and costs and
expenses (including, without limitation, attorney's fees and disbursements),
whether foreseen or unforeseen, asserted against or incurred by Assignor or any
of Assignor's Affiliates in connection with or arising out of acts or omissions
of Assignee or its directors, officers, employees, affiliates, partners,
brokers, agents, contractors, consultants and/or representatives, or other
matters or occurrences (unless caused by Assignor) that take place, from and
after the date hereof relating to the Leases and Security Deposits.

         ASSIGNOR FURTHER AGREES, subject to any and all obligations of Assignee
under the Group A Agreement which expressly survive the Closing, to defend and
indemnify Assignee and any disclosed or undisclosed officer, director, employee,
trustee, shareholder, partner, principal, parent, subsidiary or other person or
entity affiliated with Assignee (collectively, "Assignee's Affiliates") against,
and to hold Assignee and Assignee's Affiliates harmless from, any and all
claims, demands, causes of action, losses, damages, liabilities, and costs and
expenses (including, without limitation, attorney's fees and disbursements),
whether foreseen or unforeseen, asserted against or incurred by Assignee or any
of Assignee's Affiliates in connection with or arising out of acts or omissions
of Assignor or its directors, officers, employees, affiliates, partners,
brokers, agents, contractors, consultants and/or representatives, or other
matters or occurrences (unless caused by Assignee) that took place, on or prior
to the date hereof relating to the Leases and Security Deposits. Notwithstanding
the foregoing, Assignor's liability hereunder shall be subject at all times to
the limitations on Seller's liability set forth in the Group A Agreement,
including, without limitation, the provisions of Sections 7.1(c); 13; 17; and
24.5.

         Except as expressly set forth herein or in the Group A Agreement,
Assignee hereby unconditionally and irrevocably waives any and all claims and
causes of action of any nature whatsoever it may now or hereafter have against
Assignor or Assignor's Affiliates, and hereby unconditionally and irrevocably
fully releases and discharges Assignor and Assignor's Affiliates from any and
all liability whatsoever which may now or hereafter accrue in favor of Assignee
against Assignor or Assignor's Affiliates, in connection with or arising out of
the Leases and Security Deposits.

         This Assignment and Assumption of Leases and Security Deposits is made
without any covenant, warranty or representation by, or recourse against,
Assignor or Assignor's Affiliates of any kind whatsoever, except as expressly
set forth herein or in the Group A Agreement.

            [The remainder of this page is intentionally left blank.]

<PAGE>

         IN WITNESS WHEREOF, this Assignment and Assumption of Leases and
Security Deposits has been executed as of the date and year first above written.

                                            ASSIGNOR:


                                            -------------------------
                                            By:
                                            Name:
                                            Title:


                                            ASSIGNEE:


                                            -------------------------
                                            By:
                                            Name:
                                            Title:


<PAGE>


                                    EXHIBIT D
                                    ---------

          ASSIGNMENT AND ASSUMPTION OF LICENSES AND INTANGIBLE PROPERTY
          -------------------------------------------------------------

         ASSIGNMENT AND ASSUMPTION OF LICENSES AND INTANGIBLE PROPERTY, dated as
of _______________, 2000, between _______________, a _______________
corporation, having an office at ________________________, ("Assignor") and
_______________, a _______________ corporation, having an office at
______________________ ("Assignee").

                                   WITNESSETH
                                   ----------

         WHEREAS, pursuant to that certain Purchase and Sale Agreement dated as
of __________, 2000 (the "Group A Agreement"), by and among Assignor, as seller,
certain other sellers and Assignee, as purchaser, Assignor has this day sold and
conveyed to assignee the real property more particularly described in Schedule
"1" annexed hereto and made a part hereof (the "Premises").

         NOW, THEREFORE, in consideration of the sum of Ten Dollars ($10.00) and
other good and valuable consideration paid by Assignee to Assignor, the mutual
receipt and legal sufficiency of which are hereby acknowledged, Assignor hereby
assigns, transfers and conveys to Assignee the following:

         ALL OF ASSIGNOR'S right, title and interest, if any, in and to (i) all
of the licenses, permits, certificates, approvals, authorizations and variances
issued for or with respect to the Premises by any governmental authority set
forth on Schedule "2" annexed hereto and made a part hereof (collectively, the
"Licenses"), and (ii) the trade name [insert name of shopping center], any
transferable guaranties or warranties (to the extent transferable), and all the
other intangible property relating to the operation of the Premises set forth on
Schedule "4" annexed hereto and made a part hereof (collectively, the
"Intangible Property").

         TO HAVE AND TO HOLD the same unto Assignee, its successors and assigns,
forever, from and after the date hereof, subject to the terms, covenants,
conditions and provisions of the Licenses.

         ASSIGNEE HEREBY ACCEPTS the foregoing assignment and assumes and agrees
to perform all of the obligations of Assignor, if any, under the Licenses
accruing (unless required otherwise by the Licenses) from and after the date
hereof; and

         Except as expressly set forth herein or in the Group A Agreement,
Assignee hereby unconditionally and irrevocably waives any and all claims and
causes of action of any nature whatsoever it may now or hereafter have against
Assignor or Assignor's Affiliates, and hereby unconditionally and irrevocably
fully releases and discharges Assignor and Assignor's Affiliates from any and
all liability whatsoever which may now or hereafter accrue in favor of Assignee
against Assignor or Assignor's Affiliates, in connection with or arising out of
the Licenses and/or

<PAGE>

the Intangible Property.

         This Assignment and Assumption of Licenses and Intangible Property is
made without any covenant, warranty or representation by, or recourse against,
Assignor or Assignor's Affiliates of any kind whatsoever, except as expressly
set forth herein or in the Group A Agreement.

            [The remainder of this page is intentionally left blank.]

<PAGE>

         IN WITNESS WHEREOF, this Assignment and Assumption of Licenses and
Intangible Property has been executed as of the date and year first above
written.

                                            ASSIGNOR:


                                            -------------------------
                                            By:
                                            Name:
                                            Title:


                                            ASSIGNEE:


                                            -------------------------
                                            By:
                                            Name:
                                            Title:


<PAGE>


                                   EXHIBIT E-1
                                   -----------

                              NOTICE TO REA PARTIES
                              ---------------------

                              (Seller's Letterhead)



                                                            , 2000
                                         -------------------


REA Party:        (Fill in name and address)


REA Party Code No:
                   ------------

         Re:   Sale of ___________________ shopping center, located in _______,
               _______________

Dear Sir or Madam:

         Please be advised that ________________, a party to the Reciprocal
Easement and Operating Agreement dated ___________ (as amended, the "REA") has
this day sold the above-referenced shopping center to , a ("Purchaser"), having
a Federal Employer Identification number of . Accordingly, please send all sums
pursuant to the REA to Purchaser at:

                  c/o Kimco Realty Corporation
                  3333 New Hyde Park Road
                  P.O. Box 5020
                  New Hyde Park, New York 11042-0020

         It is necessary when remitting payments to indicate the REA Party Code
Number provided above for proper credit. This is the only notice you will
receive since Purchaser does not send monthly statements.

         Please also note that, after the date hereof, all formal notices which
you may desire to give to the new party under the REA should be addressed as
follows:

                  Kimco Income Operating Partnership, L.P.
                  c/o Kimco Realty Corporation
                  3333 New Hyde Park Road
                  P.O. Box 5020
                  New Hyde Park, New York 11042-0020
                  (516) 869-9000

         Please note that you should contact your insurance broker and notify
them to send to the

<PAGE>

aforementioned address for notices a revised certificate of insurance replacing
the former party as the additional named insured with that of Purchaser and
Kimco Realty Corporation as the additional named insureds. All communications to
Purchaser should be sent to the aforementioned address for notices.

         Should you have any questions, please note the attached list of contact
people of Purchaser.

                                            Very truly yours,

                                            Seller:


                                             By:
                                                --------------------------
                                                Name:
                                                Title:


CONSENTED TO:

PURCHASER:


BY:
   -------------------------------

     By:
        -------------------------------
        Name:
        Title:

<PAGE>

                                   EXHIBIT E-2
                                   -----------

                                NOTICE TO TENANTS
                                -----------------

                              (Seller's Letterhead)


                                                                , 2000
                                                 ---------------

Tenant:  (Fill in Tenant's name and address)


Tenant Code No:
                -------------

         Re:  Sale of ___________________ shopping center, located in _______,
              ____________

Dear Sir or Madam:

         Please be advised that your landlord has this day sold the above
referenced shopping center to , a ("Purchaser"), having a Federal Employer
Identification number of .. Accordingly, please send all sums pursuant to your
lease to Purchaser at:

                  c/o Kimco Realty Corporation
                  3333 New Hyde Park Road
                  P.O. Box 5020
                  New Hyde Park, New York 11042-0020
                  [Note: for Henry Street, revise to reflect lockbox
                  arrangement]

         It is necessary when remitting payments to indicate the Tenant Code
Number provided above for proper credit. This is the only notice you will
receive since Purchaser does not send monthly statements.

         Please also note that, after the date hereof, all formal notices which
you may desire to give to the new party under your lease should be addressed to
Purchaser at:

                  c/o Kimco Realty Corporation
                  3333 New Hyde Park Road
                  P.O. Box 5020
                  New Hyde Park, New York 11042-0020
                  (516) 869-9000

         Please note that you should contact your insurance broker and notify
them to send to the aforementioned address for notices a revised certificate of
insurance replacing the former party as the additional named insured with that
of Purchaser and Kimco Realty Corporation as the

<PAGE>

additional named insureds. All communications to Purchaser should be sent to the
aforementioned address for notices.

         Should you have any questions, please note the attached list of contact
people of Purchaser.

                                           Very truly yours,

                                           Seller:


                                            By:
                                               ---------------------------
                                               Name:
                                               Title:


CONSENTED TO:

PURCHASER:


BY:
   -------------------------------

     By:
        -------------------------------
        Name:
        Title:


<PAGE>


                                   EXHIBIT F-1
                                   -----------

                          GROUND LEASE ESTOPPEL LETTER
                          ----------------------------

                                           , 2000
                               ------------



Kimco Income Operating Partnership, L.P.
3333 New Hyde Park Road
P.O. Box 5020
New Hyde Park, New York 11042-0020


         Re:      Lease dated June 22, 1972 (the "Lease") by and between Central
                  Arcade Company ("Landlord") and AVR Realty Corp., the
                  predecessor-in-interest of Philips Yonkers, LLC ("Tenant") for
                  the premises known as _________________ (the "Premises")


Dear Sirs/Madames:

         It is Landlord's understanding that you have entered into an agreement
to purchase Tenant's interest in the Lease. In such connection, Landlord hereby
certifies to you, your successors and/or assigns (and any lender providing
financing in connection therewith), with the knowledge that this Estoppel Letter
may be relied upon by the foregoing parties, as follows:

1.       The Lease is in full force and effect and has not been modified, except
         as follows (if none, so indicate): _______________________________.

2.       Basic Rent is currently $245,899.62 per year.

3.       Basic rent has been paid by Tenant through the month of ________, 2000.

4.       As of the date hereof, to the best of Landlord's knowledge, there
         exists no default on the part of Tenant under the terms, covenants,
         agreements, provisions, conditions or limitations of the Lease.

5.       The conditions in Section 14.01(a) of the Lease have been satisfied.

                                            Very truly yours,

                                            CENTRAL ARCADE COMPANY, a __________
                                            corporation

<PAGE>

                                       By:
                                          --------------------------------
                                          Name:
                                          Title:


Subscribed and sworn to before me
on this ___ date of _______, 2000


-----------------------------
Notary Public


<PAGE>


                                   EXHIBIT F-2
                                   -----------

                               REA ESTOPPEL LETTER
                               -------------------


                                                      , 2000
                                       ---------------



Kimco Income Operating Partnership, L.P.
3333 New Hyde Park Road
P.O. Box 5020
New Hyde Park, New York 11042-0020

         Re:      Reciprocal Easement and Operating Agreement (the "REA") dated
                  _________ between ___________________ ("Seller") and the
                  undersigned ("REAP") for the premises known as
                  __________________ (the "Premises")

Dear Sirs/Madames:

         It is REAP's understanding that you have entered into an agreement to
purchase the Premises. In such connection, REAP hereby certifies to you, your
successors and assigns (and any lender providing financing in connection
therewith), with the knowledge that this Estoppel Letter may be relied upon by
the foregoing parties, as follows:

1.       The REA has not been modified, amended, supplemented or assigned,
         except as set forth as follows (if none, so indicate):________________
         _________________________________________________.

2.       All conditions under the REA to be performed by Seller (including,
         without limitation, any construction or maintenance obligations) have
         been satisfied and all required contributions by Seller, if any, to
         REAP have been received, except as follows (if none, so indicate):
         ____________________________________.


3.       The REA, as amended, modified, supplemented or assigned represents the
         entire agreement between REAP and Seller with respect to the
         maintenance of the Premises.

4.       As of the date hereof, (i) there are no existing defenses or offsets
         which REAP has against the enforcement of the REA by Seller, (ii) there
         exist no defaults under the REA.

5.       REAP is not entitled to any credits, offsets, abatements or deductions
         against or in respect of the maintenance payable under the REA.

6.       There are no free maintenance periods or other concessions under the
         REA.

<PAGE>

7.       The fixed maintenance payable under the REA is $_______ per annum,
         payable monthly in advance, and such fixed maintenance has been paid
         through __________. No maintenance has been paid more than thirty (30)
         days in advance of the due date thereof.

8.       The REA provides for the following maintenance escalations or
         additional percentage or other payments, all of which have been paid by
         REAP to the date hereof: $________.

9.       There are no actions or proceedings, whether voluntary or involuntary,
         pending against REAP under the bankruptcy or insolvency laws of the
         United States of America or any state thereof.

10.      There is no right to cancel or terminate the REA, no option, right of
         first refusal or other right to purchase the Premises or any part
         thereof or interest therein.

                                       Very truly yours,

                                       ____________________________ (REAP)

                                       By:
                                          --------------------------------
                                          Name:
                                          Title:

Subscribed and sworn to before me
on this ___ date of _______, 2000


-----------------------------
Notary Public

<PAGE>



                                   EXHIBIT F-3
                                   -----------

                             TENANT ESTOPPEL LETTER
                             ----------------------


                                                      , 2000
                                       ---------------



Kimco Income Operating Partnership, L.P.
c/o Kimco Realty Corporation
3333 New Hyde Park Road

P.O. Box 5020
New Hyde Park, New York 11042-0020

         Re:      Lease dated ___________ (the "Lease") by and between
                  __________________ ("Landlord") and the undersigned ("Tenant")
                  for a portion of the premises known as _________________ (the
                  "Premises")

Dear Sirs/Madames:

         It is Tenant's understanding that you have entered into an agreement to
purchase the Premises. In such connection, Tenant hereby certifies to you, your
successors and/or assigns (and any lender providing financing in connection
therewith), with the knowledge that this Estoppel Letter may be relied upon by
the foregoing parties, as follows:

1.       The Lease is in full force and effect as of the date hereof and has not
         been modified, amended, supplemented or assigned, except as follows (if
         none, so indicate):__________________________________________________.

2.       All conditions under the Lease to be performed by Landlord (including,
         without limitation, any construction or maintenance obligations) have
         been satisfied and all required contributions by Landlord, if any, to
         Tenant on account of Tenant's improvements have been received except as
         follows (if none, so indicate): ______________________________________.
         Tenant has accepted the premises demised under the Lease and has taken
         full possession and occupancy thereof and is open for business in the
         Premises.

3.       The Lease, as amended, supplemented, modified or assigned represents
         the entire agreement between Tenant and Landlord with respect to the
         leasing of the Premises.

4.       The term of the Lease is for _________ years. The term commenced on
         ___________ and expires on ____________. The Lease does not provide for
         any renewal options, except as follows (if none,

<PAGE>

         so indicate): _________________________________________________________
         ___.

5.       As of the date hereof, (i) there are no existing defenses or offsets
         which Tenant has against the enforcement of the Lease by Landlord, and
         (ii) there exist no defaults under the Lease.

6.       Tenant is not entitled to any credits, offsets, abatements or
         deductions against or in respect of the rent payable under the Lease.

7.       There are no free rent periods or other concessions under the Lease.

8.       The amount of the security deposit presently held by Landlord under the
         Lease is $________.

9.       The fixed rent payable under the Lease is $_______ per annum, payable
         monthly in advance, and such fixed rent has been paid through
         __________. No rent has been paid more than thirty (30) days in advance
         of the due date thereof.

10.      The Lease provides for the following rent escalations or additional
         percentage or other rents or payments, all of which have been paid by
         Tenant to the date hereof: $________.

11.      There are no actions or proceedings, whether voluntary or involuntary,
         pending against Tenant under the bankruptcy or insolvency laws of the
         United States of America or any state thereof.

12.      There is no right to cancel or terminate the Lease, no option, right of
         first refusal or other right to purchase the Premises or any part
         thereof or interest therein.

                                            Very truly yours,

                                                                   (Tenant)
                                            -----------------------

                                            By:
                                               ---------------------------
                                               Name:
                                               Title:


Subscribed and sworn to before me
on this ___ date of _______, 2000


----------------------------------
Notary Public

<PAGE>


                                   EXHIBIT F-4
                                   -----------

                            GLEN COVE ESTOPPEL LETTER
                            -------------------------

                                              , 2000
                               ---------------


Kimco Income Operating Partnership, L.P.
c/o Kimco Realty Corporation
3333 New Hyde Park Road

P.O. Box 5020
New Hyde Park, New York 11042-0020

         Re:      ___________, Glen Cove, New York

Dear Sirs/Madames:

         It is the undersigned's understanding that you have entered into an
agreement to purchase the above-referenced property. In such connection, the
undersigned hereby certifies to you, your successors and/or assigns (and any
lender providing financing in connection therewith), with the knowledge that
this Estoppel Letter may be relied upon by the foregoing parties, as follows:

                  1.  A certificate of completion has been issued pursuant to
                      the Urban Renewal Plan and Land Disposition Agreement
                      dated _________ (as amended, the "LDA") in effect with
                      respect to the above-referenced property, such that (a)
                      the LDA is no longer in full force and effect, and (b) the
                      deed restrictions and covenants relating to completion are
                      no longer operative.

                  2.  To the undersigned's knowledge, that certain Urban Renewal
                      Plan and dated ___________ (as amended, the "Urban Renewal
                      Plan") is in full force and effect and the undersigned has
                      given no notice of default or non-compliance to North
                      Shore Triangle LLC under the Urban Renewal Plan.

                                       Very truly yours,

                                       GLEN COVE COMMUNITY DEVELOPMENT AGENCY


                                       By:
                                          ------------------------------------
                                          Name:
                                          Title:

Subscribed and sworn to before me

<PAGE>

on this ___ date of _______, 2000


----------------------------------
Notary Public


<PAGE>


                                    EXHIBIT I
                                    ---------

                                     FIRPTA
                                     ------


STATE OF NEW YORK   :
                    :     ss:
COUNTY OF           :

         Section 1445 of the Internal Revenue Code provides that a transferee of
a U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform the transferee that withholding of tax is not required upon
the disposition of a U.S. real property interest by MUNSEY PARK ASSOCIATES, LLC,
a limited liability company organized under the laws of the State of New York
(the "Company"), the undersigned hereby certifies the following on behalf of the
Company:

         1.  The Company is not a foreign corporation, foreign partnership,
             foreign trust, or foreign estate (as those terms are defined in the
             Internal Revenue Code and Income Tax Regulations);

         2.  The U.S. employer identification number for the Company is
             ________________; and

         3.  The office address for the Company is 417 Fifth Avenue, 3rd Floor,
             New York, New York 10016.

         4.  The Company understands that this certification may be disclosed to
             the Internal Revenue Service by the transferee and that any false
             statement contained herein could be punished by fine, imprisonment,
             or both.

         Under penalties of perjury, the undersigned declares that the
undersigned has examined this certification and to the best of the undersigned's
knowledge and belief it is true, correct and complete, and the undersigned
further declares that the undersigned has authority to sign this document on
behalf of the Company.

Dated: ____________, 2000

                                   MUNSEY PARK ASSOCIATES, LLC, a New York
                                   limited liability company

                                   By: Munsey Park Management, LLC, its managing
                                       member

                                   By: Philips International Realty Corp., a
                                       Maryland corporation, its sole member

                                   By:
                                      ----------------------------------------
                                      Name:

<PAGE>

                                      Title:

Subscribed and sworn to before me
this ___ day of __________, 2000.


-----------------------------


<PAGE>


                                    EXHIBIT L
                                    ---------

                                  BILL OF SALE
                                  ------------

         MUNSEY PARK ASSOCIATES, LLC, a limited liability company organized
under the laws of the State of New York ("Seller"), for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
hereby grants, bargains, sells, transfers and delivers to
______________________________________, a ____________________, ("Purchaser"),
all of the trade names and all of Seller's right, title and interest in and to
the fixtures, equipment, machinery, supplies and other personal property (the
"Personal Property") located on and used in connection with the real property
described in Schedule "1" attached hereto, but specifically excluding from the
Personal Property all property leased by Seller or owned by tenants or others,
if any, to have and to hold the Personal Property unto Purchaser, it successors
and assigns, forever.

         Seller does not make any representation or warranty with regard to the
Personal Property or the condition thereof. Purchaser hereby acknowledges that
the Personal Property is being sold by Seller in an AS-IS WHERE-IS condition
without recourse to Seller, except that same is free of liens and encumbrances
other than the Permitted Encumbrances (as defined in that certain purchase and
sale agreement, dated April ___, 2000 (the "Agreement") between, among others,
Seller and Purchaser).

         EXECUTED as of this ______ day of ____________, 2000.

                     SELLER:

                     MUNSEY PARK ASSOCIATES, LLC, a New York
                     limited liability company

                     BY:  Munsey Park Management, LLC, its managing member

                     By:  Philips International Realty Corp., a Maryland
                          corporation, its sole member

                     By:
                        ----------------------------------------
                        Name:
                        Title:

                     PURCHASER:


                     -------------------------------------------

                     -------------------------------------------

                     BY:  Kimco Income Reit, its general partner



<PAGE>

                           By:
                              ----------------------------------
                              Name:
                              Title:


<PAGE>


                                    EXHIBIT M
                                    ---------

                    PURCHASER'S FORM OF MANAGEMENT AGREEMENT
                    ----------------------------------------

                                 [See attached.]