<PAGE>

                                                                  Exhibit 10.121


                        AGREEMENT OF SALE AND PURCHASE

                                   BETWEEN

                             527 MADISON HOLDINGS

                                  as Seller

                                     AND

                         CORNERSTONE PROPERTIES INC.

                                 as Purchaser

                                PERTAINING TO

                    527 MADISON AVENUE, NEW YORK, NEW YORK
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                              TABLE OF CONTENTS

                                                                          Page
                                                                          ----

                                       I.

                           Sale and Purchase; Property

      1.01  Sale and Purchase................................................1
      1.02  License of Excluded Property.....................................2

                                       II.

                                  Consideration

      2.01  Purchase Price...................................................3
      2.02  Deposit..........................................................3

                                      III.

           Inspection; Representations, Operating Covenants; Estoppels

      3.01  Inspection.......................................................3
      3.02  Document Review..................................................4
      3.03  Inspection Obligations...........................................4
      3.04  Right of Termination.............................................5
      3.05  Property Conveyed "AS IS"........................................5
      3.05  Seller's and Purchaser's Representations.........................6
      3.06  Interim Operating Covenants.....................................10
      3.07  Estoppel Certificates...........................................11
      3.08  Contracts.......................................................11
      3.09  Existing Mortgage Notes and Mortgages...........................12
      3.10  Hokkaido Lease..................................................12

                                       IV.

                                     Survey

      4.01  Survey..........................................................13

                                       V.

                                      Title

      5.01  Title...........................................................13

                                       VI.

                                    Remedies

      6.01  Seller's Remedies...............................................14
      6.02  Purchaser's Remedies............................................14
      6.03  Legal Fees......................................................15


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                                      VII.

                                     Closing

      7.01  Closing Date....................................................15
      7.02  Closing Matters.................................................15
      7.03  Closing Costs...................................................19
      7.04  Brokerage Commissions...........................................19
      7.05  Property Management Agreement...................................19

                                      VIII.

                                  Condemnation

      8.01  Condemnation....................................................20

                                       IX.

                                  Risk of Loss

      9.01  Risk of Loss....................................................20
      9.02  Material Loss...................................................21
      9.03  Nonmaterial Loss................................................21
      9.04  Completion of Repairs...........................................22
      9.05  Postponement of Closing.........................................22

                                       X.

                                  Miscellaneous

      10.01  Entire Agreement...............................................22
      10.02  Agreement Binding on Parties...................................22
      10.03  Effective Date.................................................22
      10.04  Notice.........................................................22
      10.05  Time of the Essence............................................24
      10.06  Governing Law..................................................24
      10.07  Section Headings...............................................24
      10.08  Business Days..................................................24
      10.09  No Recordation.................................................24
      10.10  Multiple Counterparts..........................................24
      10.11  Severability...................................................24
      10.12  Guaranty.......................................................24


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<PAGE>

EXHIBITS

Exhibit "A" -     Legal Description
Exhibit "B" -     List of Excluded Personalty
Exhibit "C" -     Escrow Agreement
Exhibit "D" -     Documents for Purchaser's Review
Exhibit "E" -     Leasing Commissions
Exhibit "F" -     Tenant Delinquencies
Exhibit "G" -     Rent Roll
Exhibit "H" -     Form of Tenant Estoppel
Exhibit "I" -     Tax Reduction Proceedings


                                       iii
<PAGE>

                         AGREEMENT OF SALE AND PURCHASE

                                       FOR

                     527 MADISON AVENUE, NEW YORK, NEW YORK

            THIS AGREEMENT OF SALE AND PURCHASE ("Agreement") is made on this
22nd day of January, 1997 by and between 527 MADISON HOLDINGS, a New York
general partnership ("Seller"), and CORNERSTONE PROPERTIES INC., a Nevada
corporation ("Purchaser"), and is as follows:

                                   WITNESSETH:

            WHEREAS, Seller desires to sell and Purchaser desires to purchase
the property described in Section 1.01 below, on the terms and conditions
hereinafter set forth:

            NOW, THEREFORE, in consideration of the mutual agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged. the parties hereto agree as follows:

                                       I.

                           Sale and Purchase; Property

            1.01 Sale and Purchase. Seller agrees to sell and convey unto
Purchaser, and Purchaser agrees to purchase and accept from Seller, for the
price and subject to the terms, covenants, conditions and provisions herein set
forth, the following:

            (a) All those certain plots, pieces or parcels of land (the "Land")
      known as Block 1289, Lot 52 and located in the borough of Manhattan, New
      York County, New York being more particularly described in Exhibit "A"
      attached hereto and incorporated herein;

            (b) All right, title and interest of Seller in and to all buildings
      and all other structures, improvements and fixtures (collectively,
      "Improvements") located in or on the Land. The Land and the Improvements
      are sometimes referred to herein collectively as the "Real Property" and
      includes, without limitation, any and all utility, plumbing, electrical,
      heating, air-conditioning and ventilation lines, systems, and boilers, the
      parking garage (the "Garage") and an office building commonly known as 527
      Madison Avenue, New York, New York;

            (c) All right, title and interest, of Seller, if any, and, except as
      expressly provided in this Agreement, without any warranty of Seller, in
      and to any land lying in the bed of any street, road or access way, opened
      or proposed, in front of, at a side of or adjoining the Land to the
      centerline thereof ("Property Rights");
<PAGE>

            (d) All right, title and interest of Seller, reversionary or
      otherwise. in and to all easements in or upon the Land and all other
      rights and appurtenances belonging or in anywise pertaining thereto, if
      any ("Appurtenances");

            (e) All furniture, carpeting, draperies, appliances, building
      supplies, equipment, machinery, inventory tools, computers, books and
      records and other items of personal property owned by Seller and presently
      affixed or attached to, placed or situated upon the Real Property and used
      in connection with the ownership, operation, management, leasing and
      occupancy of the Real Property ("Personalty"), but specifically excluding
      (i) any items of personal property owned by tenants ("Tenants") at the
      Improvements and (ii) the personalty listed in Exhibit B (the "Excluded
      Personalty");

            (f) Seller's interest as landlord in all leases ("Leases") listed in
      Exhibit D and all New Leases (as defined in Section 3.06) now or hereafter
      affecting the Real Property, together with all security deposits
      ("Security Deposits") of Tenants held by Seller which are not and have not
      been applied to amounts due under the Leases;

            (g) Seller's interest in all Contracts listed in Exhibit G and all
      New Contracts; and

            (h) All right, title and interest of Seller, if any, in and to all
      intangible and mixed property relating to the ownership or operation of
      the Real Property or Personalty, in each case only to the extent
      assignable, including, without limitation, licenses, permits, guaranties,
      warranties, bonds, approvals, applications, plans, drawings,
      specifications, surveys, maps, trade names, telephone numbers and similar
      property but in each case, except as expressly provided in this Agreement,
      without warranty ("Intangible Property"), but specifically excluding all
      bank accounts and cash of Seller other than the Security Deposits.

            The items described in (a) through (h) of this Section 1.01 are
hereinafter collectively called the "Property".

            1.02 License of Excluded Property. Seller agrees that from and after
the Closing Date, Purchaser shall have a license to use the Excluded Property in
the Building for no charge; provided that (a) Purchaser shall maintain and
insure the Excluded Property in such manner and amounts as reasonably requested
by Seller and (b) either party may terminate the license at any time upon not
less than three months' prior notice delivered not earlier than March 1, 1998.
This Section 1.02 shall survive this Closing.


                                       2
<PAGE>

                                       II.

                                  Consideration

            2.01 Purchase Price. The purchase price ("Purchase Price") to be
paid by Purchaser to Seller for the sale and conveyance of the Property shall be
Sixty-Seven Million and No/100 Dollars ($67,000,000.00), which shall be payable
to Seller on the day that the closing of the transaction contemplated hereby
occurs ("Closing") by Federal Reserve wire transfer of immediately available
funds to an account or accounts which shall be designated by Seller not less
than two (2) business days before the Closing Date (hereinafter defined in
Section 7.01), plus or minus prorations and adjustments as hereinafter provided.

            2.02 Deposit. Upon execution and delivery of this Agreement by
Purchaser, Purchaser shall deposit into an escrow account with Battle Fowler,
Seller's counsel, Two Million Dollars ($2,000,000) pursuant to an escrow
agreement in the form of Exhibit C annexed hereto. The total down payment
deposit together with all interest earned thereon (the "Deposit") shall be paid
to Seller at the Closing and $2,000,000 thereof shall be credited against the
Purchase Price, unless Purchaser shall have elected to terminate this Agreement
pursuant to the provisions of Section 3.04 of this Agreement or the Closing
shall not occur for any reason other than a default by Purchaser, in which
cases, the entire Deposit shall be returned to Purchaser.

                                      III.

           Inspection; Representations, Operating Covenants; Estoppels

            3.01 Inspection. Subject to the provisions of this Section 3.01 and
the rights of entry in Seller (and any limitations thereon) under applicable
Leases, Seller shall and hereby does permit Purchaser and its affiliates and
their respective directors, employees, investors, lenders, agents,
representatives. advisors. consultants and contractors (collectively, "Purchaser
Related Parties") the right to enter upon the Real Property at all reasonable
times during normal business hours to inspect the Property and conduct
non-invasive tests, provided that entry into any Tenant's space shall be done
after business hours and, if requested by Seller, accompanied by a
representative of Seller. Purchaser shall conduct such entry and inspections
diligently and in good faith during the period commencing on the date hereof and
ending on the day prior to the Closing Date. Purchaser shall notify Seller, in
writing, of its intention, or the intention of the Purchaser Related Parties, to
enter the Real Property at least twenty-four (24) hours prior to such intended
entry. If Purchaser or the Purchaser Related Parties intend to conduct any
physical testing or sampling of the Property, Purchaser shall describe such
testing and sampling in its notice and shall obtain Seller's prior written
consent thereto, which may be withheld in Seller's sole discretion. Purchaser
shall bear the cost of all inspections and tests. At Seller's option, Seller or
its representatives may be present for any inspection or test.


                                       3
<PAGE>

            3.02 Document Review. (a) Seller agrees to permit Purchaser and the
Purchaser Related Parties, at either the office of Seller's property manager or
at the Real Property (at Seller's option), the right to inspect the items set
forth in Exhibit "D" attached hereto and made a part hereof or such other
non-proprietary or non-confidential documents reasonably requested by Purchaser
relating to the Property (collectively, "Documents"). Purchaser at its expense
shall have the right to make photocopies of the Documents.

            (b) Purchaser acknowledges that any and all of the Documents may be
proprietary and confidential in nature and have been or will be delivered to
Purchaser or a Purchaser Related Party solely to assist Purchaser in making its
decision as to the purchase of the Property. Purchaser and any Purchaser Related
Party shall not disclose the contents of the Documents, or any of the
provisions, terms or conditions thereof, or any other information that Purchaser
or any Purchaser Related Party acquires as a result of Purchaser's due diligence
or otherwise to any party other than a Purchaser Related Party. Notwithstanding
the foregoing, Purchaser or any Purchaser Related Party may disclose any such
information if (i) it is legally compelled to make such disclosure or (ii) such
information is or becomes generally available to the public from a source other
than the Purchaser Related Parties. Purchaser further agrees that as to the
Purchaser Related Parties, the Documents shall be disclosed and exhibited only
to those Purchaser Related Parties who have been notified of the necessity to
preserve the confidentiality of such information as required herein. Purchaser
further acknowledges that the Documents and other information relating to the
leasing arrangements between Seller and the Tenants or prospective tenants are
proprietary and confidential in nature. Purchaser agrees not to divulge the
contents of such Documents and other information except in strict accordance
with the confidentiality standards set forth in this Section 3.02. In permitting
the Purchaser Related Parties to review the Documents or other information to
assist Purchaser, Seller has not waived any privilege or claim of
confidentiality with respect thereto, and no third party benefits or
relationships of any kind, either express or implied, have been offered,
intended or created by Seller and any such claims are expressly rejected by
Seller and waived by Purchaser and the Purchaser Related Parties, for whom, by
its execution of this Agreement, Purchaser is acting as an agent with regard to
such waiver.

            (c) Seller shall reasonably cooperate with Purchaser so that
Purchaser shall have the opportunity after February 5, 1997 (but not prior
thereto) and prior to the Scheduled Closing Date to contact and meet with any
and all Tenants at the Property as part of Purchaser's investigation of the
Property; provided, that Purchaser shall provide not less than 24 hours' notice
to Seller of its intention to meet with any Tenant and provided, further, that
Seller shall have the opportunity to have its representative present at any such
meeting.

            3.03 Inspection Obligations. (a) In conducting any inspections,
investigations or tests of the Property and/or Documents. Purchaser and the
Purchaser Related Parties shall: (i) not unreasonably disturb the Tenants or
interfere with their use of the Property pursuant to their respective Leases;
(ii) not unreasonably interfere with the operation and maintenance of the Real
Property; (iii) not damage any part of the Property or any personal property
owned by any


                                       4
<PAGE>

Tenant or any other person or entity; (iv) not injure or otherwise cause bodily
harm to Seller, the Seller Related Parties, any Tenant or any other person or
entity; (v) maintain appropriate comprehensive general liability (occurrence)
insurance covering any accident arising in connection with the presence of
Purchaser and the Purchaser Related Parties on the Real Property; (vi) not
permit any liens to attach to the Real Property by reason of the exercise of its
rights hereunder: and (vii) fully restore the Real Property to the condition in
which the same was found before any such inspection or tests were undertaken.

            (b) Purchaser hereby agrees to indemnify, defend and hold Seller and
Seller's Partners, affiliates, employees, agents and representatives
(collectively, "Seller Related Parties") harmless from and against any and all
liens, claims, causes of action, damages, liabilities, demands, suits,
obligations, losses, penalties, costs and expenses (including reasonable
attorneys' fees) arising out of Purchaser's conducting its inspections or tests
of the Property or out of any violation of the provisions of this Section 3.03.
Notwithstanding any provision of this Agreement to the contrary, neither the
Closing nor any termination hereof shall terminate Purchaser's obligations
pursuant to this Section 3.03.

            3.04 Right of Termination. If, prior to February 13, 1997 (the
"Scheduled Closing Date"), Purchaser shall, for any reason, in Purchaser's sole
discretion, judgment and opinion, be dissatisfied with any aspect of the
Property or any item examined by Purchaser pursuant to Sections 3.01 and 3.02,
Purchaser shall be entitled to terminate this Agreement by giving written notice
to Seller on or before the Scheduled Closing Date, whereupon this Agreement
shall terminate, and upon such termination, neither Seller nor Purchaser shall
have any further obligation or liability to the other hereunder, except for the
provisions of this Agreement which are expressly provided to survive termination
of this Agreement (the "Termination Surviving Obligations"). If Purchaser shall
fail to timely notify Seller in writing of its option to terminate this
Agreement on or before the Scheduled Closing Date, the termination right
described in this Section 3.04 shall be null and void.

            3.05 Property Conveyed "AS IS". (a) Disclaimer of Representations
and Warranties by Seller. Notwithstanding anything contained herein to the
contrary, except for the representations set forth in Sections 3.05(a) and 7.04,
it is understood and agreed that Seller and the Seller Related Parties have not
made and are not now making, and they specifically disclaim. any warranties,
representations or guaranties of any kind or character, express or implied, oral
or written, past, present or future, with respect to the Property, including,
but not limited to, warranties, representations or guaranties as to (i) matters
of title, (ii) environmental matters relating to the Property or any portion
thereof, (iii) geological conditions, including, without limitation, subsidence
or subsurface conditions, (iv) zoning to which the Property or any portion
thereof may be subject, (v) the availability of any utilities to the Property or
any portion thereof including, without limitation, water, sewage, gas and
electric, (vi) usages of adjoining Property, (vii) access to the Property or any
portion thereof, (viii) the value, compliance with the plans and specifications,
size, location, age, use, design, quality, description, suitability, structural
integrity, operation or physical or financial condition of the Property or any
portion thereof, (ix) any


                                       5
<PAGE>

income, expenses, charges, liens, encumbrances, rights or claims on or affecting
or pertaining to the Property or any part thereof, (x) the presence of Hazardous
Substances (hereinafter defined) in or on, under or in the vicinity of the
Property, (xi) the condition or use of the Property or compliance of the
Property with any or all past, present or future federal, state or local
ordinances, rules, regulations or laws, building, fire or zoning ordinances,
codes or other similar laws, or (xii) the merchantability of the Property or
fitness of the Property for any particular purpose (Purchaser affirming that
Purchaser has not relied on Seller's skill or judgment to select or furnish the
Property for any particular purpose, and that Seller makes no warranty that the
Property is fit for any particular purpose).

            (b) Sale "As Is". Except for the limited representations set forth
in Sections 3.05(a) and 7.04, Purchaser has not relied upon and will not rely
upon, either directly or indirectly, any representation or warranty of Seller or
the Seller Related Parties and acknowledges that no such representations or
warranties have been made. Purchaser represents that it is a knowledgeable,
experienced and sophisticated purchaser of real estate and that it is relying
solely on its own expertise and that of the Purchaser Related Parties in
purchasing the Property. Purchaser will conduct such inspections and
investigations of the Property as Purchaser deems necessary, including, but not
limited to, the physical and environmental conditions thereof, and shall rely
upon same. Upon Closing, except for the limited representations set forth in
Sections 3.05(a) and 7.04, Purchaser shall assume the risk that adverse matters
including, but not limited to, adverse physical and environmental conditions,
may not have been revealed by Purchaser's inspections and investigations.
Purchaser acknowledges and agrees that except for the limited representations
set forth in Sections 3.05(a) and 7.04, upon Closing, Seller shall sell and
convey to Purchaser and Purchaser shall accept the Property "AS IS, WHERE IS,"
with all faults. The terms and conditions of this Section 3.05 shall expressly
survive the Closing and not merge with the provisions of any closing documents.

            (c) "Hazardous Substances" Defined. For purposes hereof, "Hazardous
Substances" means any hazardous, toxic or dangerous waste, substance or
material, pollutant or contaminant, as defined for purposes of the Comprehensive
Environmental Response. Compensation and Liability Act of 1980 (42 U.S.C.
Sections 9601 et seq.), as amended ("CERCLA"), or the Resource Conservation and
Recovery Act (42 U.S.C. Sections 6901 et seq.), as amended ("RCRA"), or any
other federal, state or local law, ordinance, rule or regulation applicable to
the Property, or any substance which is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous, or any
substance which contains gasoline, diesel fuel or other petroleum, hydrocarbons,
polychlorinated biphenyls (pcbs), radon gas, urea formaldehyde, asbestos, lead
or electromagnetic waves.

            3.05 Seller's and Purchaser's Representations. (a) The
representations set forth in this Section 3.05(a) and in Section 7.04 constitute
the only representations of Seller to Purchaser in connection with the sale of
the Property. Seller represents to Purchaser as of the date hereof as follows:


                                       6
<PAGE>

            (i) Seller is a New York general partnership, duly formed and
      validly existing and in good standing under the laws of the State of New
      York.

            (ii) Seller has the authorization and power to execute and deliver
      this Agreement and to consummate the Closing contemplated hereby. Any
      required consents from third parties to Seller's execution and delivery of
      this Agreement have been obtained, except for the consent of General
      Electric Capital Corporation to the release of the Mortgage (as defined in
      Section 3.09) from the Property which Seller agrees to use reasonable
      efforts to obtain, and if Seller is unable to obtain such consent prior to
      the Closing Date, Purchaser or Seller may terminate this Agreement and
      Seller shall reimburse Purchaser for its reasonable, actual third-party
      out-of-pocket costs and expenses in conducting its due diligence but in no
      event to exceed $250,000 in the aggregate. Except as provided in the
      foregoing sentence, the execution and delivery of this Agreement and the
      consummation of the transactions contemplated herein by Seller will not
      violate Seller's documents of formation or any other agreement, judicial
      decree, statute or regulation to which Seller is a party or by which it is
      bound.

            (iii) Seller is neither insolvent nor has it made an assignment for
      the benefit of its creditors, nor has it filed or had filed against it,
      any petition for bankruptcy or reorganization.

            (iv) The documents listed in Exhibit D include all Leases of the
      Property which are in effect on the date hereof. Seller has delivered to
      Purchaser copies of all such Leases and such copies are true, accurate and
      complete. The documents listed in Exhibit D include all Contracts relating
      to the Property in effect on the date hereof. Seller has delivered to
      Purchaser copies of all such Contracts and such copies are true, accurate
      and complete.

            (v) On the Closing Date, there will be no Contracts affecting the
      Property except (A) the Contracts listed in Exhibit D and any New
      Contracts, (B) the Leases listed in Exhibit D and any New Leases, and (C)
      any agreements delivered by Seller to Purchaser prior to the Closing Date
      which have been approved in writing by Purchaser.

            (vi) Seller has not received any written notice or citation (a
      "Notice"):

                  (A) From any federal, state, county or municipal authority
            alleging a violation of any fire, health, safety, building
            pollution, environmental (including, without limitation, relating to
            any Hazardous Substances), zoning law, regulation, permit, order or
            directive in respect of the Property or any part thereof, which
            relates to a violation which would cost more than $5,000 to correct
            which has not been corrected;


                                       7
<PAGE>

                  (B) From any insurance company of any material defects or
            inadequacies in the Property or any part thereof, which would
            materially, adversely affect the insurability of the same or of any
            termination or threatened termination of any policy of insurance; or

                  (C) From any governmental authority with respect to a proposed
            eminent domain taking of all or any portion of the Property.

            If any such Notice is received by Seller prior to Closing, Seller
      shall notify Purchaser promptly thereof and provide a copy of such Notice
      to Purchaser.

            (vii) Seller has not received any notice of the pendency of any
      litigation or judicial or administrative proceeding affecting Seller or
      the Property which is not covered by insurance and which claims damages in
      excess of $100,000. Seller has not with respect to the Property suffered
      or confessed any judgment in or before any such court, commission, agency
      or other administrative authority against which remains unsatisfied.

            (viii) Seller does not directly employ any employees who work at the
      Property.

            (ix) Except as set forth in Exhibit "E' hereto, Seller has not
      granted to any person the right to receive any leasing commission in
      connection with the extension or renewal of any Lease or in connection
      with the exercise by any Tenant of any expansion or extension option
      contained in any Lease. Neither Seller nor the Property is subject to any
      "protection list" or similar obligation with respect to the future leasing
      of the property. Except as set forth in Exhibit "F" hereto, no Tenant is
      delinquent in payment of any rent owed under its Lease for more than
      thirty (30) days.

            (x) Seller is not a party to any construction contracts for material
      tenant improvements to the Property or any portion thereof other than
      Contracts included in Exhibit D annexed hereto, and not more than $500,000
      in the aggregate remains unpaid under said Contracts.

            (xi) No portion of the Property is subject to any real property or
      other tax abatement, reduction or phase-in program or agreement. There are
      no tax certiorari or tax reduction proceedings currently pending in
      respect of the Property except as set forth in Exhibit I.

            (xii) Attached hereto as Exhibit G is a rent roll of the Property
      which is true and complete in all material respects as of the date
      thereof. Except as set forth on Exhibit G hereto, (a) no rent has been
      paid by any Tenant more than thirty (30) days in advance, (b) to the best
      of Seller's knowledge, neither any Tenant nor Seller is in default in the
      performance of any material covenant, agreement or condition contained in
      any of the Leases, (c) Seller has not received written notice from any
      Tenant regarding pending or


                                       8
<PAGE>

      threatened offsets against rent or for any other monetary or material
      claim against Seller which has not been cured and no future rent
      concessions have been created which are not disclosed in the Leases, and
      (d) to the best of Seller's knowledge, except as provided in this
      Agreement with respect to any New Lease, any and all construction or
      improvements that were required to be performed by Seller under any Lease
      prior to the date hereof have been fully completed and accepted by each
      Tenant and all leasing commissions payable on account of any of the Leases
      have been fully paid, except those which may become due in connection with
      the exercise by any Tenant of any expansion or extension option contained
      in any of the Leases.

            (xiii) To the best of Seller's knowledge, all governmental approvals
      required for the current use of the Property have been issued and are
      currently in effect without violation, the Property is not under
      investigation for failure to comply in any material respect with any
      statutes, laws, ordinances, rules, regulations, orders or directives of
      any and all governmental agencies pertaining to the use or occupancy of
      the Property, and the Property is in material compliance with, and not in
      violation of, any applicable statutes, laws, ordinances, rules,
      regulations, orders or directives; provided, however, that Seller makes no
      representation herein with respect to compliance with the Americans with
      Disabilities Act or any rule, regulation or interpretation promulgated
      thereunder.

            (xiv) To the best of Seller's knowledge, there are no Hazardous
      Substances at the Property except for ordinary cleaning, landscaping,
      maintenance, and office supplies which are used and stored in compliance
      with applicable laws, and Seller has not previously used, manufactured.
      generated, treated, stored, disposed of, or released any Hazardous
      Substances on or under the Property or transported any Hazardous
      Substances over the Property.

            (xv) There has been no sale by Seller of any of the development
      rights or air rights relating to or forming a part of the Property.

            (b) Purchaser represents and warrants that:

            (i) Purchaser is a corporation, duly formed, validly existing and in
      good standing under the laws of the State of Nevada.

            (ii) Purchaser has the authorization and power to execute and
      deliver this Agreement and will on the Closing Date have the authorization
      and power to consummate the Closing. Any required consents from third
      parties to Purchaser's execution and delivery of this Agreement have been
      obtained. The execution and delivery of this Agreement do not, and,
      assuming due authorization of Purchaser, the consummation of the
      transactions contemplated herein by Purchaser will not, violate
      Purchaser's documents of formation or any other agreement, judicial
      decree, statute or regulation to which Purchaser is a party or by which it
      is bound.


                                       9
<PAGE>

            (iii) Purchaser is neither insolvent nor has it made an assignment
      for the benefit of its creditors, nor has it filed or had filed against
      it, any petition for bankruptcy or reorganization.

            (c) Conditions for Bringing a Claim for Breach of a Representation
or Warranty. Where representations and warranties are made in this Agreement to
the "best of Seller's knowledge", such phrase shall mean and be limited to the
actual knowledge of Jeffrey Sussman, Rolland Baribeau or David Shepherd. In no
event will either party be entitled to recover damages for any breach of the
above representations unless such party files a lawsuit in a court of competent
jurisdiction on or prior to the date which is twelve (12) months following the
Closing Date. Neither party may assert a claim against the other party for
breach of one or more representations or warranties unless the aggregate loss
sustained by the claiming party as a result of such breach or breaches equals or
exceeds $50,000. Purchaser shall not have the right to make any claim against
Seller for breach of any representation or warranty by Seller if Purchaser had
actual knowledge of the facts and circumstances giving rise to such breach prior
to the Closing. As used herein with respect to Purchaser, the term "actual
knowledge" shall mean the actual, and not constructive, knowledge of either John
Moody or Francis Shields.

            (d) Changed Conditions. It shall be a condition precedent to
Purchaser's obligations hereunder that the representations set forth in Section
3.06(a) be remade as of the Closing Date. If Seller shall become aware of any
fact or circumstance that makes any representation of Seller untrue in any
material and adverse respect, it shall disclose the same to Purchaser and, if
such changed condition is material, Purchaser may, as its sole and exclusive
remedy therefor, elect to terminate this Agreement and receive a return of the
Deposit on or before the earlier to occur of five (5) days after Seller's notice
thereof, or the Closing Date, or accept the Property and close without
adjustment to the Purchase Price, in which event the applicable representation
shall be deemed modified by such changed condition.

            3.06 Interim Operating Covenants. (a) Seller covenants to Purchaser
that, from the date hereof until Closing, Seller shall:

            (i) Operate the Property in substantially the manner that it is
      presently being operated in the ordinary course of Seller's business
      (which shall not include any major capital improvements or repairs and
      shall be subject to casualty and the occurrence of force majeure events).

            (ii) Maintain its existing insurance for the Property and, subject
      to Articles VIII and IX hereof, keep and maintain the Property in its
      current condition, reasonable wear and tear excepted.

            (iii) Not enter into or record any easement, lien, covenant, or any
      license, permit agreement or other instrument affecting the Property or
      any portion thereof that would materially adversely affect the value of
      the Property without Purchaser's approval,


                                       10
<PAGE>

      not to be unreasonably withheld, and Seller shall provide Purchaser with
      true and complete copies thereof' within two (2) business days after
      execution.

            (iv) Not remove any of the Personalty owned by Seller from the
      Property unless such removal is due to obsolescence or for the purpose of
      repair.

            (v) Seller shall deliver notice to Purchaser within two (2) business
      days after execution thereof, but in no event later than February 10,
      1997, if Seller shall enter into (A) any new lease or any amendment,
      modification, assignment or sublease to or of any Lease (any of the
      foregoing of which notice has been given to Purchaser in the manner herein
      required, a "New Lease") or any termination of any Lease or (B) any
      material extension, modification or amendment of any Contract or any
      material new service, maintenance or operating agreement (any of the
      foregoing of which notice has been given to Purchaser in the manner herein
      required, a "New Contract"). In the event that Seller enters into a New
      Contract or New Lease and Purchaser delivers notice to Seller within two
      (2) business days after receipt of Seller's notice of such New Contract or
      New Lease that Purchaser (i) objects to the terms of such New Contract or
      New Lease (and Purchaser shall be entitled to make only reasonable
      objections) and (ii) desires to terminate this Agreement pursuant to
      Section 3.04 as a result thereof, unless Seller shall terminate such New
      Lease or New Contract within five (5) business days thereafter, Seller
      shall be obligated to reimburse Purchaser for its reasonable actual third
      party, out-of-pocket costs and expenses incurred in conducting its due
      diligence to the date of termination of this Agreement, but in no event to
      exceed $250,000 in the aggregate. Seller is expressly authorized, without
      Purchaser's consent, to enforce all Lease obligations, including
      collection of rents, and is authorized, without Purchaser's consent, to
      compromise and settle amounts owing to Seller for periods prior to Closing
      and to accept the surrender or termination of a lease at the scheduled
      expiration of its term.

            (b) It shall be a condition precedent to Purchaser's obligations
hereunder that Seller not have breached in any material respect any of the
covenants set forth in Section 3.06(a).

            3.07 Estoppel Certificates. Purchaser's obligation to purchase the
Property shall be subject to the receipt, by the Closing Date, of estoppel
certificates in the form of Exhibit H annexed hereto and indicating no
materially adverse circumstances (such as landlord defaults or Tenant options to
purchase the Property) from (A) Sumitomo Trust & Banking, W.P. Stewart Co.,
Inc., Hill Samuel New York. Inc.. Saudi Petroleum International and the Gap,
Inc., (B) any combination of Tenants whose Leases, together with the Leases in
Clause (A), cover seventy-five percent (75%) of the net rentable area of the
Property (exclusive of the Garage) and (C) the operator of the Garage (the
"Tenant Estoppels").

            3.08 Contracts. Prior to the date of this Agreement, Seller
delivered to Purchaser copies of each contract and agreement relating to the
Property (including, without limitation, all service and maintenance contracts,
brokerage and listing agreements, construction


                                       11
<PAGE>

contracts and management agreements) (other than Leases, each, a "Contract")
listed in Exhibit "D". On the Closing Date, Purchaser shall assume all Contracts
on Exhibit D and all New Contracts, provided that, except as provided in Section
7.05, all management and leasing agreements for the Property shall be terminated
by the Closing Date. Seller shall either terminate prior to the Closing any
Contract not included in Exhibit D or which is not a New Contract, or otherwise
be solely responsible for the payment of any sums due or that become due under
such Contracts.

            3.09 Existing Mortgage Notes and Mortgages. Seller shall cooperate
with Buyer in causing the assignment on the date of Closing to Purchaser or any
lender designated by Purchaser (the "Assignee"), in consideration of $10.00 to
be paid by Purchaser, of the $35,000,000 existing note and mortgage (the
"Mortgage") encumbering the Property held by Property Equity Corp., a
corporation the stock of which is owned by affiliates of Seller and General
Electric Capital Corporation ("Assignor"), without any cost or expense to Seller
or any residual risk of liability to Seller. Seller shall be entitled to receive
from Purchaser twenty five percent (25%) of the amount, if any, of mortgage
recording tax savings resulting from such assignment of the Mortgage if, as and
when such savings are realized; provided that (i) savings shall be determined
net of Purchaser's out-of-pocket costs and expenses (including reasonable legal
fees) incurred in obtaining such savings, not to exceed $75,000 in the
aggregate, (ii) such savings may only be realized, if at all, upon the first
assignment, conversion or amendment of the Mortgage following the assignment of
the Mortgage to Assignee on the Closing Date, to a lender which is not
affiliated with Purchaser and (iii) if at any time after payment to Seller of
its share of any savings, Purchaser is required or elects to pay, and actually
pays, the mortgage recording tax which may be payable in respect of the
Mortgage, then Seller shall promptly refund to Purchaser the entire payment made
by Purchaser to Seller hereunder. Purchaser shall keep Seller generally apprised
of its undertakings under the foregoing provisions. The provisions of this
Section 3.09 shall survive the Closing for a period of ten years.

            3.10 Hokkaido Lease. Seller represents to Purchaser that the certain
Lease (the "Hokkaido Lease"), dated November 25, 1987 between Seller and The
Hokkaido Bank ("Hokkaido") has been terminated prior to the date hereof and that
neither party thereto has any surviving rights or obligations with respect
thereto. Notwithstanding the foregoing, from and after the Closing Date, Seller
shall pay to Purchaser all base rent and tax and operating expense escalation
payments which would have been due by Hokkaido to Purchaser under the Hokkaido
Lease had the Hokkaido Lease not been terminated prior to its stated expiration
on November 24, 1997, as and when such payments would have been due under the
Hokkaido Lease. In addition to the foregoing, the pro-ration of rents to be made
pursuant to Section 7.01(d) shall be made as if the base rent on tax and
operating expense escalation payment due under the Hokkaido Lease for the month
in which the Closing occurs had been paid to Seller. In the event that Purchaser
executes a lease with a tenant for all or any portion of the premises demised
under the Hokkaido Lease and such tenant commences paying rent for such space
prior to November 24, 1997, then Seller shall receive a credit against its
obligation to make payments to Purchaser under this Section 3.10 on a
dollar-for-dollar basis for the amount of base rental and operating expense


                                       12
<PAGE>

escalation payments, collected by Purchaser from the new tenant for the period
up to November 24, 1997. The obligations of Seller under this Section 3.10 shall
survive the Closing.

            3.11 Audits. Seller has informed Purchaser that Seller has retained
Ernst & Young LLP (the "Accountant") to audit Seller's 1996 financial statements
(the "First Audit"). Seller shall use reasonable efforts to ensure that the
Accountant completes such audit in a timely manner. Purchaser has informed
Seller that Purchaser intends to engage the Accountant to audit for Purchaser's
benefit, in connection with the preparation of Purchaser's regulatory filings,
certain financial statements of the Property for 1996 prepared by Purchaser (the
"Second Audit"). Upon request of Purchaser, in connection with the Second Audit,
Seller agrees to execute and deliver a letter to the Accountant which (i)
permits the Accountant to use information and data obtained from Seller in
connection with the First Audit for the purpose of conducting the Second Audit
and (ii) contains Seller's representations as to the accuracy and completeness
of all such information and data and such other representations as are
customarily delivered to accountants in connection with the auditing of
financial statements. Seller shall otherwise cooperate with Purchaser and the
Accountant (or any other reputable accountant retained by Purchaser) as may be
reasonably requested by Purchaser in connection with the Second Audit.

                                       IV.

                                     Survey

            4.01 Survey. If Purchaser desires to obtain an update, revision or
recertification of any existing survey of the Property or to obtain a new survey
thereof it may do so at its sole cost and expense, but in no event will a
revised or new survey be deemed to be or constitute a condition precedent to
Purchaser's Performance hereunder.

                                       V.

                                      Title

            5.01 Title. (a) Purchaser shall obtain such information concerning
title to the Property and a title insurance policy commitment as it shall desire
at its sole cost and expense. Purchaser shall provide to Seller a copy of any
title commitment which it obtains. Prior to 5:00 p.m. (New York City time) on
the date seven (7) business days prior to the Closing Date, Purchaser shall
advise Seller of any good faith objection to any matter affecting title to the
Property or shown on any survey of the Property ("Title Objection"). Seller may,
but shall not be obligated to, cure such Title Objection which has been timely
made; provided, however, that Seller shall be obligated to obtain a release of
any mortgage which encumbers the Property and any lien created by Seller (each,
a "Required Cure Matter"). Within five (5) business days after receipt of any
Title Objection that it is not obligated to cure, Seller shall notify Purchaser
either that Seller shall attempt to cure such Title Objection or that Seller is
unable or unwilling, to do so. If Seller elects not to cure such Title
Objection, Purchaser shall be deemed to have waived all


                                       13
<PAGE>

Title Objections unless on or prior to the Closing Date, Purchaser delivers to
Seller written notice terminating this Agreement. If Seller shall have notified
Purchaser within said five (5) business day period that it shall attempt to cure
such Title Objection, then Seller shall have an additional fifteen (15) days in
which to complete such cure and the Closing Date shall be extended accordingly.
If Seller is unable to complete such cure during such additional fifteen (15)
day period, then at the end of such period Purchaser shall either waive such
Title Objection and complete the Closing within five (5) business days
thereafter or Purchaser shall notify Seller of the termination of this
Agreement. Seller shall not be liable to Purchaser in the event Seller attempts
but is unable to cure such Title Objection. (Those matters which Purchaser is
[illegible] to take title subject to in accordance with this Agreement,
"Permitted Exceptions").

            (b) It shall be a condition to Purchaser's obligation to purchase
the property and consummate the Closing that the Deed convey to Purchaser good
and [illegible] marketable fee simple title to the Property, subject only to
Permitted Exceptions and the [illegible] of Tenants, which is insurable at
standard rates by a reputable title insurance company [illegible] to do business
in New York.

            (c) In the event of termination of this Agreement pursuant to
Section (a), the Deposit shall be returned to Purchaser, and thereafter neither
party shall have further rights or obligations hereunder, except for the
Termination Surviving Obligations.

                                       VI.

                                    Remedies

            6.01 Seller's Remedies. In the event Purchaser fails to perform its
[illegible] pursuant to this Agreement for any reason except the failure by
Seller to perform hereunder or the failure of any condition precedent to
Purchaser's obligations hereunder or Purchaser fails to terminate this Agreement
in accordance with Section 3.01, Seller shall be [illegible] as its sole and
exclusive remedy, to terminate this Agreement and recover the [illegible] as
liquidated damages and not as a penalty, in full satisfaction of all claims
against Purchaser hereunder (excluding any claim for breach of a Termination
Surviving Obligation). Seller and Purchaser agree that Seller's damages
resulting from Purchaser's default are difficult, if not impossible, to
determine and the Deposit is a fair estimate of those damages which has been
agreed to in an effort to cause the amount of said damages to be certain.

            6.02 Purchaser's Remedies. In the event (A) Seller fails to perform
its obligations pursuant to this Agreement for any reason except the failure by
Purchaser to perform hereunder, or (B) of a failure of any condition precedent
to Purchaser's obligation to consummate the Closing, Purchaser shall elect, as
its sole and exclusive remedy, either to terminate this Agreement by giving
Seller timely written notice of such election prior to the Closing and recover
the Deposit or (ii) enforce specific performance of this Agreement. In the event
that Seller willfully and in bad faith defaults in the performance of its
obligations under this Agreement, and


                                       14
<PAGE>

Purchaser is otherwise ready, willing and able to consummate the Closing,
Purchaser shall, as a sole addition to its rights under clauses (i) and (ii) of
the first sentence of this Section 6.02, be entitled to recover from Seller its
reasonable actual third out-of-pocket costs and expenses; provided, however, in
no event shall Purchaser be [illegible] to recover from Seller any amount in
excess of $250,000.

            6.03 Legal Fees. In the event either party hereto employs attorneys
to enforce any provisions hereof or in the event any litigation arises out of
this Agreement between the parties hereto, the non-prevailing party shall pay
all reasonable legal fees and [illegible] of the prevailing party incurred in
connection therewith.

                                       VII

                                     Closing

            7.01 Closing Date. The Closing shall be held in the offices of
counsel to Seller in New York City (or such other location as may be mutually
agreed upon by Seller and Purchaser) at 10:00 A.M. on the Scheduled Closing Date
(the date on which the Closing occurs being the "Closing Date"), time being of
the essence.

            7.02 Closing Matters. (a) At Closing, Seller shall:

            (i) Deliver originals or certified copies of the Leases and all
      Contracts affecting the Real Property either at the place of Closing or by
      making same available at the Property;

            (ii) Deliver possession of the Property, subject only to the
      Permitted Exceptions and the rights of Tenants;

            (iii) To the extent available and in Seller's possession, deliver
      copies of all permits issued by appropriate governmental authorities and
      utility companies relating to the Property and other items of Intangible
      Property, any plans and specifications, guaranties, warranties, manuals,
      keys and similar items;

            (iv) Execute, acknowledge and deliver a quit claim deed ("Deed") of
      the Real Property;

            (v) Execute, acknowledge and deliver a bill of sale ("Bill of Sale")
      conveying without representation or warranty the Personalty and an
      instrument of assignment ("Assignment") assigning without representation
      or warranty, except as expressly provided herein. Seller's interest in the
      Leases included in Exhibit D, any New Leases, the Intangible Property, the
      Security Deposits, the Contracts included in Exhibit D and any New
      Contracts and providing that Purchaser assumes all obligations under such
      Leases


                                       15
<PAGE>

      and Contracts accruing after the Closing and that each party shall
      indemnify the other for losses arising out of claims based on
      circumstances prevailing during their respective periods of ownership of
      the Property;

            (vi) Deliver evidence reasonably satisfactory to Purchaser's title
      company of its authority to execute the Deed;

            (vii) Deliver a non-foreign entity certification;

            (viii) Deliver a notice letter to each Tenant acknowledging that
      Seller has conveyed its interest in the Property and Leases to Purchaser;

            (ix) Deliver evidence of the termination of the existing property
      management agreement and leasing agreement for the Property together with
      any prospect list prepared by the leasing agent in connection with such
      termination;

            (x) Deliver originals of all Estoppel Certificates received by
      Seller which were not previously furnished to Purchaser;

            (xi) Deliver transfer tax affidavits, resolutions of Seller's board
      of trustees authorizing the sale of the Property in accordance with this
      Agreement and designating those persons authorized to execute and deliver
      all necessary documents at Closing and an affidavit in favor of such title
      company in form and substance customarily delivered in connection with
      commercial transactions in New York City to omit from any title insurance
      policy issued to Purchaser or Purchaser's mortgagee exceptions for (x)
      parties in possession (other than with respect to Tenants under the Leases
      or New Leases), (y) mechanic's liens created by or through Seller and (z)
      and the so-called "recordation gap";

            (xii) Deliver all Security Deposits including any interest earned
      thereon to the extent required to be returned to any Tenant under any
      Lease or New Lease. If any Security Deposit is in the form of a letter of
      credit, Seller shall use reasonable efforts to obtain and deliver at the
      Closing an amendment thereto or a replacement thereof naming Purchaser as
      beneficiary. If any such letter of credit has not been so amended or
      replaced as of the Closing, at Closing Seller shall enter into an agency
      agreement with Purchaser reasonably acceptable to both parties pursuant to
      which Seller shall acknowledge that any such letter of credit is in the
      name of Seller as agent for Purchaser, and that Seller will, as agent for
      Purchaser and at Purchaser's expense, present and draw upon such letter of
      credit upon demand by Purchaser. The obligations of Seller with respect to
      such letter of credit Security Deposit shall survive the Closing;

            (xiii) Execute and deliver a management agreement pursuant to
      Section 7.05;


                                       16
<PAGE>

            (xiv) Execute and deliver a current rent roll for the Property,
      certified as true, correct and complete by Seller; and

            (xv) Execute and deliver the New York State Real Estate Transfer Tax
      and New York City Real Property Transfer Tax forms.

            (b) At Closing, Purchaser shall:

            (i) Deliver the Purchase Price (less $2,000,000 and any adjustments
      provided herein) by wire transfer to Seller on the Closing Date;

            (ii) Execute and deliver a management agreement pursuant to Section
      7.05;

            (iii) Execute and deliver the New York State Real Estate Transfer
      Tax and New York City Real Property Transfer Tax forms;

            (iv) Execute and deliver such other documents as may be reasonably
      required by Seller or the title company including, but not limited to, a
      certified copy of a resolution of the board of directors, general partners
      or managers of Purchaser authorizing Purchaser to consummate the purchase
      of the Property in accordance with this Agreement and designating those
      persons authorized to execute and deliver all necessary documents at
      Closing;

            (v) Execute and deliver the Bill of Sale and the Assignment; and

            (vi) Execute and deliver the notice letters to each Tenant
      acknowledging that Purchaser has received and is responsible for the
      Security Deposits.

            (c) At Closing, Purchaser and Seller shall execute and deliver a
Closing Statement setting forth the Purchase Price and all prorations,
adjustments and credits thereto, and, if necessary, a post-closing agreement
with respect to any adjustments based on estimates that are to be re-adjusted
after Closing.

            (d) At Closing, the following items shall be prorated as of the
Closing Date with all items of income and expense for the Property being borne
by Purchaser for the Closing Date: rents (including base rent, operating expense
and tax escalations and other additional rent); prepaid and accrued expenses
(including, without limitation, utility charges, water and sewer charges, fees
for licenses and permits, and the cost of fuel) and obligations under Contracts
listed in Exhibit D and any New Contracts, and real and personal ad valorem and
other taxes and assessments against the Property ("Ad Valorem Taxes"); provided
that:

            (i) If the Ad Valorem Taxes for the 1996-1997 tax year are not known
      or cannot be reasonably estimated, they shall be adjusted based on an
      estimate obtained using


                                       17
<PAGE>

      the then current assessed value of the Property as of the Closing and the
      tax rate and multiplier reflected by the Ad Valorem Taxes due and payable
      in the 1995-1996 tax year. After the Ad Valorem Taxes for the year of
      Closing are known, adjustments will be made between the parties. The
      provisions of this Section 7.02(d)(i) shall survive Closing.

            (ii) From and after the Closing Date, Purchaser shall have the right
      to control all tax certiorari and tax reduction proceedings relating to
      the Property, whether for tax years prior to, on or after the Closing
      Date. Any tax refund or credit obtained by Purchaser (net of any costs of
      obtaining such refund) attributable to the period prior to the Closing
      Date shall be paid, first, to any Tenants entitled thereto and the
      balance, if any, to Seller (and with respect to any credit, the balance
      shall be paid to Seller when Purchaser realizes the benefit of such
      credit).

            (iii) Purchaser shall take all steps necessary to effectuate the
      transfer of all utilities to Purchaser's name as of the Closing Date, and
      where necessary, Purchaser shall post deposits with the utility companies.
      Seller shall ensure that all utility meters are read as of the Closing
      Date. Seller shall pay all utility charges accruing up to the Closing Date
      and all utilities thereafter shall be paid for by Purchaser. Seller shall
      be entitled to recover any and all deposits held by any utility company as
      of the date of Closing. To the extent Purchaser fails to provide, where
      required, deposits to any such utility company(s) (or to provide any other
      deposits with service providers) so as to prevent the timely release of
      Seller's deposit(s) by the utility company(s) (or such other service
      providers) on the Closing Date, the amount of such deposit(s) shall be
      credited to Seller and the Purchase Price shall be adjusted accordingly.
      In such event, the Seller's deposit(s) will be assigned to Purchaser who
      shall have rights to have the deposit(s) released to it upon satisfaction
      of the conditions imposed by the utility company (or such other service
      providers).

            (iv) Seller shall at Closing provide to Purchaser a credit for the
      amount of any rents paid to Seller by the Tenants for the Closing Date and
      periods subsequent to the Closing Date. No proration shall be made for
      rents delinquent as of the Closing Date (the "Delinquent Rents"). All
      Delinquent Rents collected on or after the Closing Date shall be
      allocated, first, to the then current month, next, to the month in which
      the Closing occurs, next, to any other delinquency after the Closing Date,
      and finally to any other delinquency prior to the Closing Date. Any
      Delinquent Rents collected by Purchaser after Closing shall be held in
      trust and forthwith paid by Purchaser to Seller subject to and in
      accordance with the foregoing allocation provision. Purchaser shall use
      reasonable efforts to collect such Delinquent Rents, but in no event shall
      Purchaser be obligated to commence legal proceedings for collection
      against any Tenant. All rights to pursue collection of Delinquent Rents
      shall vest solely in Purchaser. Purchaser shall settle all common area
      maintenance charges, tax reimbursements and any percentage rents based on
      sales for 1997 with the Tenants and (1) to the extent the Tenants are
      required to pay additional amounts for 1997, Purchaser shall pay to Seller
      its pro rata share thereof as and when received, or (2) to the extent the
      landlord is required to refund or credit amounts for


                                       18
<PAGE>

      common area maintenance charges or tax reimbursements to the Tenants.
      Seller shall pay to Purchaser its pro rata share thereof promptly
      following a request therefor (which request shall be supported by
      appropriate financial information). Purchaser shall provide to Seller such
      financial information as shall be reasonably requested by Seller to verify
      the items described in clauses (1) and (2) above.

            (v) The costs incurred or agreed to by Seller in securing Leases
      executed after the date hereof, including, without limitation, brokerage
      commissions (including in respect of renewals and expansions), work letter
      or tenant installation costs or allowances, lease takeover costs,
      reasonable attorneys' fees and disbursements, advertising expenses and any
      other tenant inducement costs (collectively, "Leasing Costs") shall be the
      responsibility of Purchaser. To the extent such Leasing Costs relate to
      Leases executed prior to the date hereof, such costs shall remain the
      obligation of Seller, except that Purchaser will be responsible for all
      leasing commissions due with respect to renewals and extensions of
      existing Leases first exercised after the date hereof.

            (vi) The terms of Section 7.02(d) of this Agreement shall survive
      the Closing.

            7.03 Closing Costs. Purchaser shall pay any title examination fees,
costs of any title commitment and title policy (including any endorsements or
amendments thereto or any title company inspection fees or mortgage title policy
costs) and any other charge relating to title as well as any survey of the
Property. Seller shall pay all transfer taxes associated with filing the Deed.
Purchaser shall pay any recording fees, mortgage taxes or other similar taxes,
fees or assessments, and all costs relating to inspections or tests it
authorizes or conducts. Except as otherwise provided in Section 6.03 and 7.04,
each party shall be responsible for the payment of its own attorneys' fees
incurred in connection with the transaction that is the subject of this
Agreement.

            7.04 Brokerage Commissions. Purchaser agrees to pay to Edward S.
Gordon Company ("Purchaser's Broker") a brokerage commission at Closing pursuant
to a separate agreement between Purchaser and Purchaser's Broker. Other than
Purchaser's Broker, Seller and Purchaser each represent and warrant to the other
that it has not dealt with any broker in connection with the transaction
contemplated hereby, and each agrees to and does hereby indemnify and hold the
other harmless against the payment of any commission to any person or entity
claiming by, through or under Seller or Purchaser, as applicable. This
indemnification shall extend to any and all claims, liabilities, costs and
expenses (including reasonable attorneys' fees and litigation costs) arising as
a result of such claims and shall survive the Closing. Purchaser shall indemnify
and hold Seller harmless against the payment of the commissions due to
Purchaser's Broker.

            7.05 Property Management Agreement. At the Closing, Seller and
Purchaser will enter into a management agreement pursuant to which Seller or an
affiliate of Seller will be designated as the property manager and leasing agent
for the property. The management


                                       19
<PAGE>

agreement will be cancellable by either party with or without cause on 30 days
prior notice; provided that Purchaser shall not exercise its right to cancel the
agreement without cause at any time prior to 120 days after the Closing Date.
The management agreement shall be based on Purchaser's standard form thereof
(provided same is generally on market terms and in customary form) and shall
otherwise be on market terms and subject to market conditions.

                                      VIII.

                                  Condemnation

            8.01 Condemnation. If, prior to Closing, any governmental authority
or other entity having condemnation authority shall institute an eminent domain
proceeding with regard to all or any material portion of the Real Property,
Seller shall give prompt notice of same to Purchaser. If such proceedings are
not dismissed on or before ten (10) business days prior to Closing, Purchaser
shall be entitled, as its sole and exclusive remedy, to terminate this Agreement
upon written notice to Seller on or before the Closing Date. In the event
Purchaser does not terminate this Agreement pursuant to the preceding sentence,
Purchaser shall be conclusively deemed to have elected to accept such
condemnation and waives any right to terminate this Agreement as a result
thereof. Notwithstanding anything to the contrary herein, if any eminent domain
proceeding is instituted solely for the taking of any subsurface rights for
utility easements or for any right-of-way easement. and the surface [illegible],
after such taking, be used in substantially the same manner as though such
rights had not been taken. Purchaser shall not be entitled to terminate this
Agreement as to any part of the Real Property, but any award resulting therefrom
shall be assigned to Purchaser at Closing and shall be the exclusive property of
Purchaser upon Closing. In the event Purchaser elects to terminate this
Agreement under this Section 8.01, the Deposit shall be returned to Purchaser in
accordance with Section 6.04 and neither party to this Agreement shall
thereafter have any further rights or obligations hereunder, except the
Termination Surviving Obligations. If Purchaser waives (or is deemed to have
waived) the right to terminate this Agreement as a result of such a
condemnation, despite such condemnation Seller and Purchaser shall close this
Agreement in accordance with the terms hereof with no reduction in the Purchase
Price, and Seller shall assign to Purchaser at Closing all of Seller's right,
title and interest in and to all proceeds resulting or to result from said
condemnation.

                                       IX.

                                  Risk of Loss

            9.01 Risk of Loss. If, prior to the Closing, any of the Improvements
shall be damaged by a fire or other casualty ("Casualty"), Seller shall deliver
to Purchaser written notice ("Casualty Loss Notice") of such Casualty promptly
after it has made its termination determination provided for in Section 9.02
hereof.


                                       20
<PAGE>

            9.02 Material Loss. For the purposes of this Section 9.02, "Material
Damage" shall mean damage to the Improvements of such nature that the cost of
restoring same to their condition prior to the Casualty will, in Seller's
reasonable determination, equal or exceed $1,000,000. If, in Seller's reasonable
determination, which determination shall be made as promptly as is practicable,
the Improvements have sustained Material Damage by a Casualty, Seller may, at
its option, terminate this Agreement by delivering written notice to Purchaser
on or before Closing, and neither party hereto shall have any further rights or
obligations hereunder except the Termination Surviving Obligations. In the event
Seller does not so terminate this Agreement, Purchaser may, as its sole option,
within fifteen (15) days after delivery of the Casualty Loss Notice, either (a)
terminate this Agreement by delivering written notice of same to Seller or (b)
waive its right of termination and elect to proceed to close this transaction in
accordance with the terms hereof ("Waiver Option").

            Failure of Purchaser to deliver written notice of termination within
said fifteen (15) day period shall be conclusively deemed to be an election by
Purchaser of the Waiver Option. In the event Seller or Purchaser elects to
terminate this Agreement under this Section 9.02, the Deposit shall be returned
to Purchaser in accordance with Section 6.04 and thereafter neither party to
this Agreement shall thereafter have any further rights or obligations
hereunder, except the Termination Surviving Obligations.

            If Purchaser elects the Waiver Option, then, at its option, Seller
shall (a) repair the Improvements to substantially their condition prior to such
damage, if and to the extent Seller reasonably determines that repairs cannot be
delayed until Closing, subject to Section 9.04 or (b) deliver to Purchaser at
Closing an amount equal to the insurance deductible and assign to Purchaser all
of its rights in the resulting casualty insurance proceeds (but the amount of
such deductible plus insurance proceeds shall not exceed the lesser of (i) the
cost of repair or (ii) the Purchase Price). In the event Seller assigns
insurance proceeds, (A) Purchaser may notify all appropriate insurance companies
of its interest in the insurance proceeds, and (B) all casualty insurance
proceeds payable as a result of the loss (subject to the limitation herein
described) shall be assigned to Purchaser at Closing.

            9.03 Nonmaterial Loss. In the event, in Seller's reasonable
determination, the cost of restoration following a Casualty is less than
$250,000.00, the rights and obligations of the parties shall not be affected
thereby and at its option Seller shall (a) repair the Improvements (subject to
Section 9.04) to substantially their condition prior to such damage, if and to
the extent Seller reasonably determines that repairs cannot be delayed until
Closing, or (b) deliver to Purchaser at Closing an amount equal to the insurance
deductible and assign to Purchaser all of its rights in the resulting casualty
insurance proceeds (but the amount of such deductible plus insurance proceeds
shall not exceed the lesser of (i) the cost of repair or (ii) the Purchase
Price). In the event Seller assigns insurance proceeds. (A) Purchaser may notify
all appropriate insurance companies of its interest in the insurance proceeds,
and (B) all casualty insurance proceeds payable as a result of the loss (subject
to the limitation herein described) shall be assigned to Purchaser at Closing.


                                       21
<PAGE>

            9.04 Completion of Repairs. If and to the extent Seller reasonably
determines that repairs cannot be delayed until Closing, Seller shall cause such
repairs to be performed as promptly as practicable, in a good and workman-like
manner and in compliance with applicable laws. Subject to Section 3.04, if
Seller is repairing the Property and the repairs cannot be completed by the
Closing Date, (i) this transaction shall close on the Closing Date and Seller
shall complete the repairs within a reasonable period after Closing, (ii) Seller
shall assign the applicable construction contracts and agreements to Purchaser,
pay to Purchaser an amount equal to the deductible and assign to Purchaser all
of its rights in the resulting casualty insurance proceeds (less amounts
expended to date) and cooperate with Purchaser in the transfer of the repair
process to Purchaser at Closing and (iii) Purchaser shall release Seller from
liability with respect to any repair or replacement activities undertaken by
Seller prior to Closing.

            9.05 Postponement of Closing. If, as a result of a Casualty, any
determination, election or agreement required by the terms of this Article IX is
not made by the Closing Date, the Closing Date shall be extended until ten (10)
business days after said determination, election or agreement is made,
notwithstanding anything in this Agreement to the contrary.

                                       X.

                                  Miscellaneous

            10.01 Entire Agreement. This Agreement contains the entire agreement
of the parties hereto. There are no other agreements, oral or written, and this
Agreement can be amended only by written agreement signed by the parties hereto,
and by reference, made a part hereof.

            10.02 Agreement Binding on Parties. This Agreement, and the terms,
covenants, and conditions herein contained, shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto. Purchaser
may not assign its rights hereunder without the prior written consent of Seller
other than to a wholly-owned subsidiary of Purchaser; provided, however, such
assignment shall not relieve Purchaser of its obligations hereunder.

            10.03 Effective Date. The effective date of this Agreement shall be
the date first above written.

            10.04 Notice. Any notice, communication, request, reply or advice
(collectively, "Notice") provided for or permitted by this Agreement to be made
or accepted by either party must be in writing. Notice may, unless otherwise
provided herein, be given or served by (i) depositing the same in the United
States mail, postage paid, certified, and addressed to the party to be notified,
with return receipt requested, (ii) by depositing the same into custody of a
nationally recognized overnight delivery service such as Federal Express
Corporation, Airborne Express, UPS, Emery or Purolator or (iii) by telecopier
with a hard copy to follow. Notice deposited in the mail in the manner described
in (i) above shall be effective on the third (3rd)


                                       22
<PAGE>

business day after such deposit. Notice delivered pursuant to clause (ii) shall
be effective on the first business day after mailing. Notice given by telecopier
shall be effective when sent by the notifying party between the hours of 8:00
A.M. and 5:00 P.M. (EST) of any business day with delivery made after such hours
to be deemed received the following business day. For the purposes of notice,
the addresses of the parties shall, until changed as hereinafter provided, be as
follows:

Seller:                 527 Madison Holdings
                        c/o Louis Dreyfus Property Group, Inc.
                        405 Lexington Avenue
                        57th Floor
                        New York, New York  10174
                        Attention:  Jeffrey I. Sussman
                        Phone:      (212)  490-2626
                        Facsimile:  (212)  490-1060

with  a  copy  to:      BATTLE FOWLER
                        75 East 55th Street
                        New York, New York  10022
                        Attention:  Martin L. Edelman, Esq.
                        Phone:      (212)  856-7000
                        Facsimile:  (212)  856-7813

Purchaser:              CORNERSTONE PROPERTIES INC.
                        126 East 56th Street
                        New York, New York  10022
                        Attention:  President
                        Phone:      (212)  605-7100
                        Facsimile:  (212)  605-7199

with copy to:           Shearman & Sterling
                        599 Lexington Avenue
                        New York, New York  10022
                        Attention:  Timothy G. Little, Esq.
                        Phone:      (212) 848-7720
                        Facsimile   (212) 848-7179

The parties hereto shall have the right from time to time to change their
respective addresses, and each shall have the right to specify as its address
any other address within the United States of America by at least five (5) days'
written notice to the other party.

            10.05 Time of the Essence. Time is of the essence in all things
pertaining to this Agreement, including all times and dates specified herein for
performance by either party.


                                       23
<PAGE>

            10.06 Governing Law. This Agreement shall be construed in accordance
with the laws of the State of New York.

            10.07 Section Headings. The section headings contained in this
Agreement are for convenience only and shall in no way enlarge or limit the
scope or meaning of the various and several sections hereof.

            10.08 Business Days. In the event that any date or any period
provided for in this Agreement shall end on a Saturday, Sunday or legal holiday,
the applicable date or period shall be extended to the first business day
following such Saturday, Sunday or legal holiday.

            10.09 No Recordation. There shall be no recordation of either this
Agreement or any memorandum hereof, or any affidavit pertaining hereto and any
such recordation of this Agreement or memorandum hereof without the prior
written consent of Seller shall constitute a willful default hereunder by
Purchaser, whereupon this Agreement shall, at the option of Seller, terminate
and be of no further force and effect and Seller shall be entitled to pursue all
of its rights at law or in equity.

            10.10 Multiple Counterparts. This Agreement may be executed in
multiple counterparts (each of which is to be deemed an original for all
purposes).

            10.11 Severability. If any provision of this Agreement or
application to any party or circumstance shall be determined by any court of
competent jurisdiction to be invalid and unenforceable to any extent, the
remainder of this Agreement or the application of such provision to such person
or circumstances, other than those as to which it is so determined invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall be
valid and shall be enforced to the fullest extent permitted by law.

            10.12 Guaranty. From and after the Closing Date, The Louis Dreyfus
Property Group, Inc., a Delaware corporation, shall be liable for and hereby
guarantees the full and punctual payment of any monetary obligations of Seller
hereunder. The provisions of this Section 10.12 shall survive the Closing.


                                       24
<PAGE>

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

                            "SELLER"

                            527 MADISON HOLDINGS, a New York
                            general partnership

                            By: 527 Madison Avenue Holdings, Inc.,
                            general partner

                                 By: /s/ Jeffrey I. Sussman
                                     -----------------------------------
                                     Name: Jeffrey I. Sussman
                                     Title: President

                            "PURCHASER"

                            CORNERSTONE PROPERTIES INC., a Nevada
                            corporation

                            By: /s/ John S. Moody
                                -----------------------------------
                                Name: John S. Moody
                                Title: President

                            By: /s/ Rodney C. Dimock
                                -----------------------------------
                                Name: Rodney C. Dimock
                                Title: Executive Vice President
<PAGE>

            The undersigned, The Louis Dreyfus Property Group, Inc., a Delaware
corporation, joins in the foregoing Agreement for the limited purpose of
agreeing to the provisions of Section 10.12 thereof, and agrees that, from and
after the Closing Date, Purchaser may assert claims against The Louis Dreyfus
Property Group, Inc. as though it were "Seller" under the Agreement.

                            THE LOUIS DREYFUS PROPERTY
                            GROUP, INC.

                            By: /s/ Jeffrey I. Sussman
                                ----------------------
                                Name: Jeffrey I. Sussman
                                Authorized Signatory


                                       26
<PAGE>

                                   EXHIBIT "A"

                                Legal Description
<PAGE>

ALL that certain plot, piece or parcel of land, situate, lying and being in the
Borough of Manhattan, City, County and State of New York, bounded and described
as follows:

BEGINNING at the corner formed by the intersection of the southerly side of 54th
Street with the easterly side of Madison Avenue;

RUNNING THENCE Southerly along the said easterly side of Madison Avenue, 60 feet
5 inches;

THENCE Easterly parallel with the southerly side of 54th Street and part of the
way through a party wall, 80 feet;

THENCE Southerly parallel with the easterly side of Madison Avenue, 40 feet to
the center line of the block;

THENCE Easterly along the said center line of the block, 68 feet;

THENCE Northerly parallel with the easterly side of Madison Avenue and part of
the way through a party wall, 100 feet 5 inches to the southerly side of 54th
Street;

THENCE Westerly along the said southerly side of 54th Street, 148 feet to the
point or place of BEGINNING.


                  Premises Address:  527 Madison Avenue, New York City
                  Tax Designation:   Block:  1289  Lot:  52
<PAGE>

                                   EXHIBIT "B"

                            List of Excluded Property
<PAGE>

Louis Dreyfus Property Group [letterhead]


                                                                January 22, 1997


The following artwork installed at 527 Madison Avenue is not to be included in
any sales arrangements:


Mason, Raymond                Barcelona Streetcar
                              1953, bronze 5/8
                              31 1/2" x 49 1/4" x 9"

                              The Crowd
                              1963-68, bronze 1/8
                              6' x 12' x 4'

                              Latin Quarter
                              1987, treated polyester resin 1/9
                              33" x 46" x 27.7"
<PAGE>

                                   EXHIBIT "C"

                                Escrow Agreement
<PAGE>

                                ESCROW AGREEMENT

            THIS ESCROW AGREEMENT (this "Agreement") made as of the ___ day of
January, 1997, by and among 527 MADISON HOLDINGS, a New York general
partnership, having an office at 405 Lexington Avenue, New York, New York 10174
("Seller"), CORNERSTONE PROPERTIES INC., a Nevada corporation, having an office
at 126 East 56th Street, New York, New York 10022 ("Purchaser") and BATTLE
FOWLER LLP, having an address at 75 East 55th Street, New York, New York 10020
("Escrow Agent").

                                    RECITALS

            Pursuant to that certain Agreement of Sale and Purchase, dated as of
the date hereof, between Seller and Purchaser (the "Contract") and to facilitate
the closing and completion of the transactions contemplated thereby, Seller and
Purchaser (collectively, the "Parties") hereby nominate constitute and appoint
Escrow Agent to hold in escrow the amount of $2,000,000 (the "Escrow"). The
Escrow shall be held in escrow and disposed of by Escrow Agent in accordance
with the directions contained in the attached Schedule "A" and on the following
terms and conditions:

1. Position of Escrow Agent.

            Escrow Agent acts hereunder as a depositary only and is not a party
to or bound by any agreement or undertaking which may be evidenced by or arise
out of the Escrow deposited with it hereunder, including, without limitation,
the Contract, and is not responsible or liable in any manner for the sufficiency
of the Escrow and undertakes no responsibility or liability for the form of
execution of such items or the identity, authority, title, or rights of any
person executing or depositing the Escrow. Escrow Agent shall have the right to
represent Seller in any dispute between the Parties with respect to the
Contract, the Escrow or otherwise.

2. Liability of Escrow Agent.

            Escrow Agent shall not be liable for any error of judgment or for
any act done or omitted by it in good faith nor for any negligence other than
gross negligence and willful misconduct, or for any thing which it may do or
refrain from doing in connection herewith except to the extent any of the
foregoing shall constitute gross negligence or willful misconduct. Escrow Agent
shall have the right to rely upon the genuineness of all certificates, notice
and instruments delivered to it pursuant hereto, and all the signatures thereto
or to any other writing received by Escrow Agent purporting to be signed by
Seller or Purchaser and upon the truth of the contents thereof. Before making
payment or delivery in accordance with the provisions hereof or otherwise, of
any moneys or documents held by Escrow Agent pursuant hereto, Escrow Agent shall
have the right, but not the obligation, to require delivery to it of an executed
and acknowledged receipt for the subject matter of the delivery to be made by
it. If Purchaser delivers a check to Escrow Agent in the amount of the escrow,
Escrow Agent shall have no obligation to
<PAGE>

enforce collection of said check. If the directions set forth in Schedule A
require Escrow Agent to deposit said check in an interest bearing account to
purchase United States Government Obligations or certificate(s) of deposit with
the Escrow and renew same when same come due, Escrow Agent shall make reasonable
efforts to keep such funds at interest and to purchase such certificate(s) of
deposit and renew same but shall have no liability to the Parties for its
failure to do so, except as provided in this Section 2.

3. Disbursement of Escrow.

            (a) As used in this Agreement, a "Final Determination" of the
respective rights of the Parties to all or any portion of the Escrow and
interest earned thereon shall mean (i) a final order which is binding upon
Escrow Agent and the Parties has been entered and finally affirmed on appeal by
the highest court before which such review is sought, or has become final by
lapse of time or is otherwise not subject to appeal or (ii) a final decision has
been rendered by an arbitrator pursuant to binding arbitration acceptable to the
Parties, in either case establishing the rights of the Parties with respect to
the Escrow and any interest earned thereon. Escrow Agent may rely on a
certification by one of the Parties stating that a Final Determination has been
rendered, which statement shall be accompanied by a written opinion of such
Party's counsel to the effect that a Final Determination has been rendered.

            (b) Escrow Agent shall continue to hold the Escrow until such time
as the Escrow Agent shall have received (1) a joint written direction executed
by the Parties or (2) a Final Determination with respect to all or such portion
of the Escrow, and interest earned thereon. Escrow Agent shall then distribute
all or such portion of the Escrow and interest earned thereon as directed by
such joint direction or Final Determination, as the case may be.

            (c) Notwithstanding any provision hereof to the contrary, Escrow
Agent shall have the right at any time to file a suit in interpleader, and/or
deposit the Escrow in a court of competent jurisdiction, and in either such
case, it shall thereupon be fully released and discharged from all further
obligations to perform any and all duties or obligations imposed upon it by this
Agreement.

4. Indemnification.

            Seller and Purchaser shall be jointly and severally liable for all
costs, damages, judgments and expenses, including reasonable attorneys' fees and
disbursements, to Escrow Agent and its counsel, suffered or incurred by Escrow
Agent in connection with or arising out of this Agreement, including, but
without limiting the generality of the foregoing, a suit in interpleader brought
by Escrow Agent and the costs and expenses of defending against any claim or
liability arising out of or related to this Agreement. Escrow Agent shall have a
first lien on the Escrow for any costs, liability, expenses or fees it may
incur.
<PAGE>

5. Notices.

            All notices under this Agreement shall be in writing and shall be
(i) delivered personally with receipt acknowledged, (ii) sent by prepaid
registered or certified mail, return receipt requested, (iii) sent by prepaid
overnight delivery service, or (iv) sent by telecopy or other facsimile
transmission (followed by hard copies sent by method (i), (ii) or (iii) above),
addressed as set forth below, or as the Parties or Escrow Agent shall otherwise
have given notice as herein provided.

            All notices shall be deemed given when actually received or when
proper delivery is refused by the party to whom the same are directed (except if
method (ii) is used, notices shall be deemed delivered five (5) days after
mailing). Any notice required to be sent under the terms of this Agreement shall
be sent as follows:

            (a)   If to Seller, to it at the address first above written, Attn:
                  Jeffrey I. Sussman, with a copy to Escrow Agent;

            (b)   If to Purchaser, to it at the address first above written,
                  Attention: John Moody, with a copy to:

                  Shearman & Sterling
                  599 Lexington Avenue
                  New York, New York  10022
                  Attention: Timothy G. Little, Esq.; and

            (c)   If to Escrow Agent, to it at the address first above written,
                  Attn: Robert J. Wertheimer.

Attorneys for Seller and Purchaser may give and receive notices with the same
effect as if such notice was given or received to or by the party represented by
such attorney. A party may by notice select alternate parties to receive notices
hereunder; such change shall be effective ten (10) days after receipt of such
change in this notice provision.

6. Modification.

            Escrow Agent shall not be bound by any modification of this
Agreement or any agreement incorporated by reference herein, unless there is
delivered to Escrow Agent a written modification signed by the Parties. Not such
modification shall, without the consent of Escrow Agent, modify the provisions
of this Agreement relating to the duties, obligations or rights of Escrow Agent.
<PAGE>

7. Taxpayer Identification Number.

            Each party hereto, except Escrow Agent, shall provided Escrow Agent
with their taxpayer identification number ("TIN") as assigned by the Internal
Revenue Service. All interest or other income earned under this Agreement shall
be allocated and paid as provided herein and reported by the recipient to the
Internal Revenue Service as having been so allocated and paid.

8. Controlling Law/Assignment.

            This Agreement shall be construed in accordance with and governed by
the laws of the State of New York and shall be binding upon Escrow Agent and the
Parties and their respective successors and assignees; provided, however, that
any assignment or transfer by either of the Parties of their respective rights
under this Agreement shall be void as against Escrow Agent unless (a) a written
notice hereof shall be given to Escrow Agent and (b) the assignee or transferee
shall agree in writing to be bound by the provision of this Agreement.
<PAGE>

            IN WITNESS WHEREOF, the Parties have hereunto set their hands and
seals as of the day and year first appearing above.

                            SELLER:

                            527 Madison Holdings, Inc.

                            By: 527 Madison Avenue Holdings, Inc.

                                 By: /s/ Jeffrey I. Sussman
                                     -----------------------------------
                                     Name: Jeffrey I. Sussman
                                     Title: President

                            PURCHASER:

                            Cornerstone Properties Inc.

                            By: /s/ John S. Moody
                                -----------------------------------
                                Name: John S. Moody
                                Title: President

                            By: /s/ Rodney C. Dimock
                                -----------------------------------
                                Name: Rodney C. Dimock
                                Title: Executive Vice President


AGREED TO AND ACCEPTED this
22nd day of January, 1997

BATTLE FOWLER LLP,
as Escrow Agent

By: /s/ Robert J. Wertheimer
    -------------------------
    Robert J. Wertheimer
    a partner
<PAGE>

                                   Schedule A

                                  Instructions

1.    Escrow Agent shall deposit the Escrow in an interest bearing escrow
      account at Chase Manhattan Bank in New York City.

2.    On the date of the closing of title under the Contract, the Parties shall
      jointly instruct Escrow Agent to deliver to Seller the Escrow together
      with all interest earned thereon ("Interest"). If the Closing under the
      Contract does not occur and Purchaser in entitled to a refund of the
      Escrow pursuant to the terms thereof, then the Parties shall jointly
      instruct the Escrow Agent to deliver the Escrow and the Interest to
      Purchaser. If the Closing under the Contract does not occur and Seller is
      entitled to retain the Escrow pursuant to the terms thereof, then the
      Parties shall jointly instruct the Escrow Agent to deliver the Escrow and
      the interest to Seller. To the extent that Seller is entitled to be
      indemnified by Purchaser for any losses, costs or expenses (collectively,
      the "Indemnified Expenses") pursuant to Section 3.03(b) of the Contract,
      then, in addition to Seller's right to seek reimbursement and/or
      indemnification directly from Purchaser for such Indemnified Expenses, and
      at Seller's election, the Parties shall jointly instruct Escrow Agent to
      deliver to Seller all or a portion of such Escrow and Interest to pay
      Indemnified Expenses.

3.    Seller's Taxpayer Identification Number is: 22-2727750.

4.    Purchaser's Taxpayer Identification Number is: 74-2170858.
<PAGE>

                                   EXHIBIT "D"

                        Documents for Purchaser's Review
<PAGE>

                                    EXHIBIT D

                         DOCUMENTS FOR PURCHASERS REVIEW

                                January 22, 1997

RE: 527 Madison Avenue, New York, NY

The Documents For Purchaser's Review submitted by Louis Dreyfus Property Group
("Seller") to Cornerstone Properties, Inc. ("Purchaser") are listed below. In
addition, there are various statements noted below which were submitted in
writing by Seller, and which Purchaser is assuming to be true and accurate
information.

TENANT INFORMATION:

1.    Copy of all leases, amendments and sublease agreements - listed as
      follows:

      - Lease dated July 31, 1992 between 527 Madison Holdings and 527 Madison
      Holdings.

      - Lease dated April 1, 1989 between 527 Madison Holdings and The Bank for
      Foreign Economic Affairs of the USSR.
      a)    First Amendment to lease dated April 5, 1994
      b)    Second Amendment to lease dated January 10, 1995
      c)    Third Amendment to lease dated July 12, 1995
      d)    Fourth Amendment to lease dated June 12, 1996

      - Lease dated September 27, 1996 between 527 Madison Holdings and Capital
      Properties Associates, L.P.

      - Lease dated August 1, 1988 between 527 Madison Holdings and The Gap,
      Inc.
      a)    First Amendment to lease dated August 1, 1988

      - Lease dated September 30, 1988 between 527 Madison Holdings and Genex
      New York Inc.
      a)    First 527 Madison Holdings Lease Amendment Agreement dated January
            9, 1989
      b)    Second 527 Madison Holdings Lease Amendment Agreement dated May 28,
            1991
      c)    Third 527 Madison Holdings Lease Amendment Agreement dated December
            31, 1991
      d)    Fourth 527 Madison Holdings Lease Amendment Agreement and Consent to
            Assignment to Tokyo General U.S.A. dated June 12, 1996
      e)    Guaranty of lease effective January 1, 1997 by Tokyo General
            Corporation

      - Lease dated September 19, 1988 between 527 Madison Holdings and Hill
      Samuel New York, Inc.
<PAGE>

      a)    Amendment to lease dated October 31, 1989
      b)    Consent to sublease to Lovell White Durrant dated February 14, 1992
            (sublease dated January 27, 1992)
      c)    Consent to sublease to Shattuck Hamond Partners Inc. dated May 10,
            1993 (sublease dated May 5, 1993)
      d)    Consent to sub-sublease to between Shattuck Hammond Partners, Inc.
            to Enzo Biochem, Ind. dated July 23, 1996 (sub-sublease dated April
            1996)

      - Lease dated January 31, 1995 between 527 Madison Holdings and Icatu
      Securities, Inc.

      - Lease dated March 4, 1993 between 527 Madison Holdings and Kastle New
      York Limited Partnership d/b/a Kastle Systems.

      a)    First Amendment to lease dated October 11, 1995.

      - Lease dated September 3, 1992 between 527 Madison Holdings and LTCB
      Latin America, Inc.
      a)    Consent to sublease to Exanc, Inc. dated September 30, 1996
            (sublease dated September 9, 1996).

      -Lease dated May 25, 1988 between 527 Madison Holdings and The Mitsubishi
      Bank Ltd.
      a)    Assignment of Office Lease with Covenant Assuming Obligations of
            Lease by The Mitsubishi Bank Ltd. to Mitsubishi Capital Inc. dated
            September 15, 1988.
      b)    Amendment Agreement dated October 30, 1989.
      c)    Consent to sublease to W P. Stewart & Co., Inc. dated June 29, 1994
            (sublease dated May 29, 1994).

      - Lease dated November 1, 1987 between 527 Madison Holdings and New York
      Parking 54th St. Corp.
      a)    Letter of Amendment to Lease dated April 30, 1991.
      b)    Second Amendment to lease dated March 15, 1994.

      - Lease dated May 30, 1995 between 527 Madison Holdings and Pactual
      Capital Corporation.

      - Lease dated February 19, 1993 between 527 Madison Holdings and Security
      Asset Management, Inc.
      a)    First 527 Madison Holdings Lease Amendment Agreement dated March 14,
            1995.

      - Lease dated June 30, 1987 between 527 Madison Holdings and Sibson &
      Company.
      a)    First Amendment to lease dated August 1989.

      - Lease dated January 19, 1988 between 527 Madison Holdings and Aramco
      Services Company.
      a)    Assignment of lease by Aramco Service Company to Saudi Petroleum
            International, Inc. dated April 28, 1988.
      b)    First Amendment to lease dated October 17, 1988.
      c)    Second Amendment to lease dated March 15, 1989.
<PAGE>

      d)    Third Amendment to lease dated February 28, 1992.

      - Lease dated February 24, 1987 between 527 Madison Holdings and The
      Solomon R. Guggenheim Foundation.
      a)    First Amendment to lease dated May 2, 1996.

      - Lease dated February 24, 1987 between 527 Madison Holdings and The
      Solomon R. Guggenheim Foundation.
      a)    First Amendment to lease dated May 2, 1996.

      - Lease dated April 25, 1986 between 527 Madison Holdings and The Sumitomo
      Trust & Banking Co., Ltd. covering 2nd and 3rd floors.
      a)    Supplement Lease Agreement dated May 28, 1986 among 527 Madison
            Holdings, E&W Development, U.S.A., Inc and The Sumitomo Trust &
            Banking Co., Ltd.
      b)    First Amendment to lease dated December 31, 1991 (adding the 8th
            floor).

      - Lease dated April 25, 1986 between 527 Madison Holdings and The Sumitomo
      Trust and Banking Co., Ltd., covering the 4th Floor.
      a)    Assignment of Lease to The Sumitomo Trust & Banking Co. (U.S.A.)
            dated September 21, 1987.

      - Lease dated April 25, 1986 between 527 Madison Holdings and E&W
      Development U.S.A., Inc., covering the 5th and 6th Floors.
      a)    First Amendment to lease dated November 1, 1987 (adding the 7th
            floor).
      b)    Assignment of lease by E&W Development U.S.A., Inc. to The Sumitomo
            Trust & Banking Co., Ltd. dated March 31, 1993.
      c)    Assignment of 5th floor lease by The Sumitomo Trust & Banking Co.,
            Ltd. to Sumitomo Trust & Banking Co. (U.S.A.) dated March 31, 1993.

      - Lease dated June 18, 1987 between 527 Madison Holdings and Printon Kane
      Capital Corp.
      a)    Assignment and Assumption Agreement between Printon Kane Capital
            Corp. and MIC Consulting, Inc. dated April 17, 1990.

      - Lease dated August 24, 1987 between 527 Madison Holdings and W.P.
      Stewart & Co., Inc.
      a)    First Amendment to lease dated May 19, 1994.
      b)    Second Amendment to lease dated June 7, 1996.
      c)    Third Amendment to lease dated August 31, 1996.
      d)    Letter of amendment to third amendment dated September 13, 1996.
      e)    Letter of agreement dated November 20, 1996.

2.    Copy of area book showing floor by floor area calculations and detailed
      lease abstracts.

3.    Master rent roll date January 1, 1997 & January 21, 1997.
<PAGE>

4.    Aged accounts receivable reports for December 1995 through December 1996.

5.    Aged accounts receivable reports as of January 20, 1997 and January 21,
      1997.

6.    Schedule of tenant security deposits.

7.    Broker's Agreement for Saudi Petroleum and Genex New York (Tokyo General).

OPERATIONS

1.    Complete 1997 budget.

2.    Audited financials from 1991 to 1995.

3.    Audited operating expenses and real estate taxes for 1994 and 1995 with
      tenant escalation billing and worksheets.

4.    Real estate tax bills for last 3 years. 1994/1995; 1995/1996; 1996/1997.

5.    Letter from tax lawyer Hubert Brandt concerning real estate tax protests,
      dated January 17, 1997.

6.    We (Seller) have received a tax refund for 1993/1994 tax year in the
      amount of $119,759.14. We (Seller) will apply this refund to the tenants
      in the form of a credit in February. The exact net refund to the tenants
      is not available at this time.

7.    Variance report: 1995 and YTD November 1996.

8.    Con Edison monthly electric bills from 12/05/94 to 1/03/97

9.    Capital expenditures status report/recently completed capital expenditures
      report: both dated January 17, 1997 (details any TI, commissions and
      capital projects outstanding).

SERVICE CONTRACTS:

List of service contracts (copies not provided as of January 22, 1997).

OTHER:

1.    There are no obligations remaining to the City since the development of
      the project.

2.    Items not provided include:
      - general ledger (available for Purchaser's review in Seller's office).
      - tenant rent invoices.
<PAGE>

      - correspondence regarding tenant audits or tenants seeking relief (no
        such conditions exist).
      - accounts payable (no outstanding bills exist).
      - schedule of litigation (no legal issues exist).
      - information on each tenant (verbal descriptions provided).

3.    Floor 26 - Long Term Credit Bank: Tenant had the right to terminate
      12/1/97 with prior written notice to landlord by 11/30/96 which was not
      exercised. LTCB subleased their space 10/1/96 to EXANE with a 11/29/2000
      expiration date (essentially coterminous with the LTCB lease). Further,
      EXANE's rental rate is equal to LTCB's, being $241,206 per annum. We
      (Seller) have not received any expression from LTCB to cancel their lease.

4.    HVAC Amortization: If you (Purchaser) examine our (Seller) 1997 budget,
      under HVAC repair (line 9000 Amortization) there is an amount for $28,020.
      This represents an HVAC capital repair (condenser water branch pipe
      replacement) which will be amortized over three years. This is placed in
      expenses so that it may be part of the recoverable operating expenses, yet
      does not represent an actual disbursement of cash. For simplicity, our
      (Seller) budgets carry amortization forward at CPI in future years. The
      information I (Purchaser) sent ESG had this amortization removed to
      reflect a true cash expense. The 1997 budget which you (Purchaser) now
      have does not deduct any amortization.

      The capital cost is shown in the 1997 budget under capital (see Capital
      spreadsheet $72,360). However, this project has been paid for, completed
      and should no longer be considered a reduction of cash flow.

5.    Hokkaido Termination: You (Purchaser) should treat the lease as in effect.
      Rather than negotiate a price reduction based on their early termination,
      we (Seller) are prepared to cover their lease obligation until the
      contractual expiration of 11/24/97. If the space is relet prior to
      11/24/97, any rental income generated would be used to offset our (Seller)
      obligation to cover Hokkaido rental payments.

6.    Saudi Petroleum Right of First Offer: I (Seller) am faxing pages 9 & 10 of
      the Third Amendment of Lease, dated February 28, 1992 and a letter of
      correspondence notifying Saudi Petroleum of the availability of the 24th
      floor. Following the notification on October 28, 1993, Saudi Petroleum had
      15 days to deliver written acceptance of the space which never occurred.
      Subsequently, the 24th floor was subleased by Mitsubishi to W. P. Stewart
      May 29, 1994. Saudi Petroleum's right of first offer was only on the first
      occasion that the 24th floor became available and therefore has expired.

7.    Regarding Sumitomo, they have trading operations on the 24th floor and
      part of the 4th.

8.    Parking rates are as follows:

      1/2 hour: $16.91    1 hour: $20.30    2 hours:  $24.52  3 hours:  $28.75
<PAGE>

      daily: $32.98   monthly: $526.34 (all of the above exclude the 18.25% tax)

9.    Listing of personal property: building office, shop equipment and art work
      (list provided by 527 Madison Avenue management office January 21, 1997).

10.   Please note that the lease abstract for Genex New York (Tokyo General)
      indicated their right of first offer expired. Under their recent lease
      renewal, Tokyo General still has a one time option on Suite 1200.
<PAGE>

                                   EXHIBIT "E"

                               Leasing Commissions
<PAGE>

Louis Dreyfus Property Group letterhead


                                          January 22, 1997

Attached are the broker agreements on file for the following tenants which have
either rights of first offer for expansion space or options to renew. Leasing
commission on such transactions may be payable to the original broker.

Saudi Petroleum:  option to renew and right of first offer

Genex New York (Tokyo General):  right of first offer
<PAGE>

                                   EXHIBIT "F"

                              Tenant Delinquencies

                  [To be provided upon request to the Company.]
<PAGE>

                                   EXHIBIT "G"

                                    Rent Roll

                  [To be provided upon request to the Company.]
<PAGE>

                                   EXHIBIT "H"

                             Form of Tenant Estoppel

To:   Cornerstone Properties Inc. ("Buyer")
                  and
      The Louis Dreyfus Property Group
      ("Landlord")

Re:   527 Madison Avenue (the "Property")
      New York, New York

            The undersigned __________, a __________ ("Tenant") is the tenant
under that certain lease dated __________ (the "Lease"), which Lease shall
include the amendments, if any, referred to below, by and between Tenant and
Landlord, covering premises commonly known as Suite ___ in the Property (the
"Lease Premises"). Tenant hereby certifies to the following as of the date
hereof:

      1.    Tenant is the tenant under the Lease demising the Leased Premises.
The term of the Lease commenced on __________ and will expire on __________.

      2.    Tenant certifies to Buyer that:

      a.    the Lease is in full force and effect and has not been cancelled,
            modified, assigned, extended or amended except as follows:
            _____________________________________
            _____________________________________
            _____________________________________

      b.    Tenant is not aware of any renewal, extension or expansion option,
            right of first offer or right of first refusal or other similar
            right to renew or extend the term of the Lease or expand the
            property demised thereunder except as may be expressly set forth
            herein or in the Lease;

      c.    the current monthly rent for the Lease Premises as of __________ is
            $__________ and has been paid through __________;

      d.    the total current additional/escalation rent for common area
            maintenance, real estate taxes, insurance and the like (all charges
            other than fixed rent) as of __________ is $__________ and is
            payable monthly;
<PAGE>

      e.    Tenant is not in arrears on any rent or other material charges
            payable by Tenant under the Lease;

      f.    Tenant has accepted and is occupying the Leased Premises, and the
            Leased Premises have been completed by Landlord as required by the
            Lease without defect;

      g.    the Lease has been neither assigned nor any portion of the Leased
            Premises subleased by Tenant except as follows:
            _____________________________________
            _____________________________________
            _____________________________________

      h.    (i) Landlord has performed all of Landlord's obligations under the
            Lease to be performed by Landlord as of the date hereof, (ii)
            Landlord is not in default under the Lease, and (iii) no event has
            occurred which, with the giving of notice or the passage of time, or
            both, could result in a default by Landlord;

      i.    Tenant has no existing defenses, offsets, deductions, liens, claims
            or credits against the rentals under the Lease or against the
            enforcement of the Lease by Landlord;

      j.    there exists no default on the part of Tenant nor state of facts
            which, with the giving of notice or the passage of time, or both,
            could result in a default by Tenant;

      k.    All contributions, if any, required to be paid by Landlord under the
            Lease to date for improvements to the Leased Premises have been
            paid;

      l.    Tenant has paid a security deposit in the amount of $__________, on
            which no interest is payable;

      m.    Tenant has been given the right to utilize ___ parking spaces in the
            parking garage on the Property and is paying for such spaces at the
            monthly rate of $__________; and

      n.    Tenant has no option or right to purchase all or any part of the
            Leased Premises or the Property.

      3. This certification is made to induce Buyer to acquire the Property of
which the Leased Premises are part. Tenant further acknowledges and agrees that
the addressees hereof and their respective successors and assigns and the holder
of any mortgage at any time encumbering the Property from and after the date of
this Tenant Estoppel Certificate shall have the right to rely on this Tenant
Estoppel Certificate.
<PAGE>

      4. Tenant acknowledges that in connection with the sale of the Property by
Landlord to Buyer all of the interest of the Landlord in and to the Lease will
be duly assigned to Buyer and that, after notice from Landlord and Buyer, all
rent payments under the Lease shall be paid to Buyer or its authorized agent,
from and after the date of sale.

      5. The undersigned is authorized to execute this Tenant Estoppel
Certificate on behalf of Tenant.

      Dated this ___ day of __________, 1996.

                              _________________________


                              By:______________________
                              Name:____________________
                              Title:___________________
<PAGE>

                                  EXHIBIT "I "

                            Tax Reduction Proceedings
<PAGE>

                     Peter H. & Hubert J. Brandt letterhead

                                                January 17, 1997

Louis Dreyfus Property Group
24 Richmond Hill Avenue
Stamford, Connecticut  06903
Attn:  Mr. Thomas Gallagher

                  Re:   527-31 Madison Avenue, Manhattan
                        Block 1289 Lot 52

Dear Mr. Gallagher:

      In response to your request, the following is a brief status report with
respect to proceedings challenging the assessed valuation of the above property.

      The last disposition with respect to these protests was made in 1994
wherein the matter was settled before the Tax Commission of the City of New
York. 1993/94 was reduced from an actual assessment of $25,020,495 to
$22,500,000 and 1994/95 was reduced from an actual assessment of $21,375,000 to
$21,000,000. The 1994/95 reduction was made on the final tax roll and tax bills
for the year were predicated on the reduced assessment; the refund with respect
to the reduction in the 1993/94 tax year was received and disbursed to you on
January 6, 1997 in the net amount, after payment of our fee, of $119,759.14.

      Judicial proceedings are pending with respect to the 1995/96 and 1996/97
assessed valuations, each of which presently stands at $21,150,000. The Real
Estate Tax Audit Report Form prescribed by Court rules to advance these matters
to the judicial calendar for disposition was filed in August, 1996. We are
awaiting review of that submission by the Office of the Corporation Counsel of
the City of New York after which we will engage in pre-trial settlement
negotiations. We will, of course, keep you apprised of the progress of that
prosecution.

      The 1997/98 tentative assessment roll was published by the City of New
York on January 15th, fixing the value at an actual total assessment of
$21,150,000, with a transitional assessment of $21,390,000. The application for
correction of this tentative assessment has been prepared and was mailed
yesterday. The income and expense schedule which is to be filed with the
application was transmitted in December 1996. The deadline for filing the
application is March 3rd.

      We trust this satisfies your request. Should you require any additional
information, please do not hesitate to call.

                                Very truly yours,

                                /s/
                                PETER H. & HUBERT J. BRANDT

RAS:jr