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EXHIBIT 3.2     BYLAWS OF THE COMPANY, AS AMENDED BY RESOLUTION OF THE BOARD OF
                DIRECTORS

                       CLARION COMMERCIAL HOLDINGS, INC.
                                     BYLAWS

                                   ARTICLE I
                                      SEAL

The Board of Directors may provide a suitable seal for the Corporation, which
may be either facsimile or any other form of seal and shall remain in the
custody of the Secretary. If the Board so provides, it shall be affixed to all
certificates of the Corporation's stock and to other instruments requiring a
seal.

                                   ARTICLE II
                                     STOCK

SECTION 1. CERTIFICATES. Each stockholder shall be entitled to a certificate or
certificates which shall represent and certify the number and kind and class of
shares owned by him in the Corporation. Each certificate shall be signed by the
Chairman of the Board or the President or a Vice President and countersigned by
the Secretary or an assistant secretary or the Treasurer or an assistant
treasurer.

The signatures may be either manual or facsimile signatures. If any officer who
has signed any certificate ceases to be an officer of the Corporation before the
certificate is issued, the certificate may nevertheless be issued by the
Corporation with the same effect as if the officer had not ceased to be such
officer as of the date of its issue. Each stock certificate shall include on its
face the name of the Corporation, the name of the stockholder and the class of
stock and number of shares represented by the certificate. If the Corporation
has authority to issue stock of more than one class, the stock certificate shall
contain on its face or back a full statement or summary of the designations and
any preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption of the stock of each class which the Corporation is authorized to
issue and if the Corporation is authorized to issue any preferred or special
class in series, the differences in the relative rights and preferences between
the shares of each series to the extent they have been set, and the authority of
the Board of Directors to set the relative rights and preferences of subsequent
series. In lieu of such full statement or summary, there may be set forth upon
the face or back of the certificate a statement that the Corporation will
furnish to any stockholder upon request and without charge, a full statement of
such information.A summary of such information included in a registration
statement permitted to become effective under the Securities Act of 1933, as
amended, shall be an acceptable summary for the purposes of this Section. Every
stock certificate representing shares of stock which are restricted as to
transferability by the Corporation shall contain a full statement of the
restriction or state that the Corporation will furnish information about the
restriction to the stockholder on request and without charge.

SECTION 2. LOST CERTIFICATES. The Board of Directors may order a new certificate
or certificates of stock to be issued in place of any certificates shown to have
been lost, stolen or destroyed under such terms and conditions as the Board of
Directors deems reasonable. When authorizing such issue of a new certificate or
certificates, the Board of Directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such stolen, lost or
destroyed certificate or certificates, or his legal representative to indemnify
the Corporation against any loss or claim which may arise by reason of the
issuance of a new certificate.

SECTION 3. TRANSFER AGENTS AND REGISTRARS. At such time as the Corporation lists
its securities on a national securities exchange or NASDAQ, the Board of
Directors shall appoint one or more banks or trust companies in such city or
cities as the Board of Directors may deem advisable, from time to time, to act
as transfer agents and/or registrars of the shares of stock of the Corporation;
and, upon such appointments being made, no certificate representing shares shall
be valid until countersigned by one of such transfer agents and registered by
one of such registrars.

SECTION 4. TRANSFER OF STOCK. No transfers of shares of stock of the Corporation
shall be made if (i) void AB INITIO pursuant to any Article of the Corporation's
Charter, or (ii) the Board of Directors, pursuant to such Article, shall have
refused a tender of such shares. Permitted transfers of shares of stock of the
Corporation shall be made on 








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the stock records of the Corporation only upon the instruction of the registered
holder thereof, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary or with a transfer agent or transfer
clerk, and upon surrender of the certificate or certificates, if issued, for
such shares properly endorsed or accompanied by a duly executed stock transfer
power and the payment of all taxes thereon. Upon surrender to the Corporation or
the transfer agent of the Corporation of a certificate for shares duly endorsed
or accompanied by proper evidence of succession, assignment or authority to
transfer, as to any transfers not prohibited by such Article of the Charter or
by action of the Board of Directors thereunder, it shall be the duty of the
Corporation to issue a new certificate to the person entitled thereto, cancel
the old certificate and record the transaction upon its books.

SECTION 5. FIXING OF RECORD DATES; CLOSING OF TRANSFER BOOKS. The Board of
Directors may fix, in advance, a date as the record date for the purpose of
determining stockholders entitled to notice of, or to vote at, any meeting of
stockholders, or stockholders entitled to receive payment of any dividend or the
allotment of any rights, or in order to make a determination of stockholders for
any other proper purpose. Such date, in any case, shall be not more than ninety
(90) days, and in case of a meeting of stockholders, not less than ten (10)
days, prior to the date on which the particular action requiring such
determination of stockholders is to be taken.

SECTION 6. REGISTERED STOCKHOLDERS. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and to hold liable
for calls and assessments, if any, a person registered on its books as the owner
of shares, and shall not be bound to recognize any equitable or other claim to
or interest in such share or shares on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise provided
by law.

SECTION 7. REGULATIONS. The Board of Directors may make such additional rules
and regulations, not inconsistent with the Bylaws, as it may deem expedient
concerning the issue, transfer and registration of certificates for shares of
stock of the Corporation.

                                  ARTICLE III
                             STOCKHOLDERS' MEETING

SECTION 1. ANNUAL MEETING. The annual meeting of the stockholders of the
Corporation shall be held in each year at the principal office of the
Corporation or at such other place in the United States as the Board of
Directors may determine, at a time and date determined by the Board of Directors
which time and date shall be within one hundred eighty (180) days after the last
day of the Corporation's fiscal year, for the purpose of electing Directors and
for the transaction of such other business as may lawfully be brought before the
meeting.

SECTION 2. SPECIAL MEETINGS. Subject to Article IV, Section 2, special meetings
of the stockholders for any purpose or purposes may be called at any time by the
President, the Chairman of the Board of Directors, by a majority of the Board of
Directors, by a majority of the Independent Directors (as defined in Section 1
of Article IV hereof), or the stockholders entitled to cast at least
thirty-three percent (33%) of the votes which all stockholders are entitled to
cast at a particular meeting.

SECTION 3. NOTICES. Notice of the annual meeting and of any special meeting of
stockholders shall, at least ten (10) days but not more than ninety (90) days
prior to the date thereof, be mailed to each stockholder entitled to vote
thereat at his last known post office address as the same appears on the records
of the Corporation. Every notice of a special meeting shall state briefly the
purpose or purposes thereof, and no business, other than that specified in such
notice and matters germane thereto, shall be transacted at any special meeting
without further notice to stockholders not present in person or by proxy.

SECTION 4. QUORUM; MANNER OF ACTING AND ADJOURNMENT. The Charter of the
Corporation provides that a majority of the stock issued and outstanding and
entitled to vote and represented by the holders of record thereof in person or
by proxy shall constitute a quorum at any meeting of stockholders, but less than
such a majority may adjourn the meeting from time to time, and at any such
adjourned meeting, any business may be transacted which might have been
transacted if the meeting had been held as originally called. No notice of any
adjourned meeting of the stockholders of the Corporation shall be required to be
given, except by announcement at the meeting, unless the adjournment is for more
than thirty (30) days or, after the adjournment, a new record date is fixed for
the adjourned meeting.







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Except as otherwise specified in the Charter or these Bylaws or provided by
applicable law, the acts, at a duly organized meeting, of stockholders present
in person or by proxy entitled to cast at least a majority of the votes which
all stockholders present in person or by proxy are entitled to cast, shall be
the acts of the stockholders.

SECTION 5. ORGANIZATION. At every meeting of the stockholders, (i) the Chairman
of the Board shall conduct the meeting or, in the case of vacancy in office or
absence of the Chairman of the Board, one of the following officers present
shall conduct the meeting in the order stated: the Vice Chairman of the Board,
if there be one, the President, the Vice Presidents in their order of rank and
seniority, or a Chairman chosen by the stockholders entitled to cast a majority
of the votes which all stockholders present in person or by proxy are entitled
to cast; and (ii) shall act as Chairman, and the Secretary or, in his absence,
an assistant secretary, or in the absence of both Secretary and assistant
secretaries, a person appointed by the Chairman, shall act as Secretary.

SECTION 6. PROXIES. Any stockholder entitled to vote at a meeting of the
stockholders may be represented and vote thereat by proxy, authorized or
appointed by an instrument in writing (or by any other method permitted by
Maryland law) by such stockholder or by his duly authorized agent and submitted
to the Secretary at or before such meeting. A proxy is revocable by the
stockholder at any time without condition or qualification unless the proxy
states that it is irrevocable and the proxy is coupled with an interest. A proxy
may be made irrevocable for such time as it is coupled with an interest.

SECTION 7. VOTING. Each stockholder entitled to vote in accordance with the
terms and provisions of the Charter and these Bylaws, except the holder of
shares which have been called for redemption and with respect to which an
irrevocable deposit of funds has been made, shall be entitled to one vote, in
person or by proxy, for each share of stock entitled to vote held by such
stockholder. Upon the demand of any stockholder, the vote for directors and upon
any question before the meeting shall be by ballot.

SECTION 8. VOTING RIGHTS. The officer or agent of the Corporation having charge
of the transfer books for shares of the Corporation shall make, at least ten
(10) days before each meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting or any adjournment thereof,
arranged in alphabetical order, with the address of and the number of shares
held by each, which list shall be kept on file at the registered office of the
Corporation. Such list also shall be produced and kept open at the time and
place of the meeting and shall be subject to the inspection of any stockholder
during the whole time of the meeting. The original share ledger or transfer
book, or duplicate thereof, shall be prima facia evidence as to who are the
stockholders entitled to examine such list or share ledger or transfer book, or
to vote, in person or by proxy, at any meeting of stockholders.

SECTION 9. INFORMAL ACTION BY STOCKHOLDERS. Unless otherwise provided by law,
any action required to be taken at a meeting of the stockholders, or any other
action which may be taken at a meeting of the stockholders, may be taken without
a meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the stockholders entitled to vote with respect to the subject
matter thereof.

SECTION 10. NOTICE OF NOMINATIONS AND OTHER STOCKHOLDER BUSINESS AND NOMINATIONS

(A) ANNUAL MEETINGS OF STOCKHOLDERS.

(1) Nominations of persons for election to the Board of Directors of the
Corporation and the proposal of other business to be considered by the
stockholders at an annual meeting of stockholders may be made (a) pursuant to
the Corporation's notice of meeting delivered pursuant to Section 3 of this
Article III, (b) by or at the direction of the Chairman of the Board of
Directors or (c) by any stockholder of the Corporation who is entitled to vote
at the meeting, who complied with the notice procedures set forth in clauses (2)
and (3) of this paragraph (A) of this Bylaw and who is a stockholder of record
at the time such notice is delivered to the Secretary of the Corporation.

(2) For nominations or other business to be properly brought before an annual
meeting by a stockholder pursuant to clause (c) of paragraph (A)(1) of this
Bylaw, the stockholder must have given timely notice thereof in writing to the
Secretary of the Corporation. To be timely, a stockholder's notice shall be
delivered to the Secretary, at the principal executive offices of the
Corporation not less than sixty (60) days nor more than ninety (90) days prior
to the first anniversary of the preceding year's annual meeting; PROVIDED,
HOWEVER, that in the event that the date of the








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annual meeting is advanced by more than thirty (30) days or delayed by more than
sixty (60) days from such anniversary date, notice by the stockholders to be
timely must be so delivered not earlier than the ninetieth (90th) day prior to
such annual meeting and not later than the close of business on the later of the
sixtieth (60th) day prior to such annual meeting or the tenth (10th) day
following the day on which public announcement of the date of such meeting is
first made. Such stockholder's notice shall set forth (a) as to each person whom
the stockholder proposes to nominate for election or reelection as a director
all information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), including such person's written consent to
being named in the proxy statement as a nominee and to serving as a director if
elected; (b) as to any other business that the stockholder proposes to bring
before the meeting, a brief description of the business desired to be brought
before the meeting, the reasons for conducting such business at the meeting and
any material interest in such business of such stockholder and the beneficial
owner, if any, on whose behalf the proposal is made; and (c) as to the
stockholder giving the notice and the beneficial owner, if any, on whose behalf
the nomination or proposal is made (i) the name and address of such stockholder,
as they appear on the Corporation's books, and of such beneficial owner and (ii)
the class and number of shares of the Corporation which are owned beneficially
and of record by such stockholder and such beneficial owner.

(3) Notwithstanding anything in the second sentence of paragraph (A)(2) of this
Bylaw to the contrary, in the event that the number of directors to be elected
to the Board of Directors of the Corporation is increased and there is no public
announcement naming all of the nominees for director or specifying the size of
the increased Board of Directors made by the Corporation at least seventy (70)
days prior to the first anniversary of the preceding year's annual meeting, a
stockholder's notice required by this Bylaw shall also be considered timely, but
only with respect to nominees for any new positions created by such increase, if
it shall be delivered to the Secretary at the principal executive offices of the
Corporation not later than the close of business on the tenth (10th) day
following the day on which such public announcement is first made by the
Corporation.

(B) SPECIAL MEETINGS OF STOCKHOLDERS. Only such business shall be conducted at a
special meeting of stockholders as shall have been brought before the meeting
pursuant to the Corporation's notice of meeting pursuant to Section 3 of this
Article III. Nominations of persons for election to the Board of Directors may
be made at a special meeting of stockholders at which Directors are to be
elected pursuant to the Corporation's notice of meeting (a) by or at the
direction of the Board of Directors or (b) by any stockholder of the Corporation
who is entitled to vote at the meeting, who complies with the notice procedures
set forth in this Bylaw and who is a stockholder of record at the time such
notice is delivered to the Secretary of the Corporation. Nominations by
stockholders of persons for election to the Board of Directors may be made at
such a special meeting of stockholders provided that notice required by
paragraph (A)(2) of this Bylaw shall be delivered to the Secretary at the
principal executive offices of the Corporation not earlier than the ninetieth
(90th) day prior to such special meeting and not later than the close of
business on the later of the sixtieth (60th) day prior to such special meeting
and the tenth (10th) day following the day on which public announcement is first
made of the date of the special meeting and of the nominees proposed by the
Board of Directors to be elected at such meeting.

(C) GENERAL

(1) Only persons who are nominated in accordance with the procedures set forth
in this Bylaw shall be eligible to be elected to serve as directors and only
such business shall be conducted at a meeting of stockholders as shall have been
brought before the meeting in accordance with the procedures set forth in this
Bylaw. Except as otherwise provided by law, the Charter or these Bylaws, the
chairman of the meeting shall have the power and duty to determine whether a
nomination or any business proposed to be brought before the meeting was made in
accordance with the procedures set forth in this Bylaw, and, if any proposed
nomination or business is not in compliance with this Bylaw, to declare that
such defective proposal or nomination shall be disregarded.

(2) For purposes of this Bylaw, "public announcement" shall mean disclosure in a
press release reported by the Dow Jones News Service, Associated Press or
comparable national news service or in a document publicly filed by the
Corporation with the Securities and Exchange Commission pursuant to Section 13,
14 or 15(d) of the Exchange Act.

(3) Notwithstanding the foregoing provisions of this Bylaw, a stockholder shall
also comply with all applicable requirements of the Exchange Act and the rules
and regulations thereunder with respect to the matters set forth in this








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Bylaw. Nothing in this Bylaw shall be deemed to affect any rights of
stockholders to request inclusion of proposals in the Corporation's proxy
statement pursuant to Rule 14a-8 under the Exchange Act.

                                   ARTICLE IV
                                   DIRECTORS

SECTION 1. NUMBER AND CLASS.

(A) The affairs of the Corporation shall be under the direction of the Board of
Directors which shall be divided into classes as provided in the Charter.

(B) The number of directors comprising the Board of Directors shall be five or
such other number as shall be fixed from time to time by a vote of eighty
percent 80% of the entire Board of Directors; provided, however, the number of
directors shall not exceed seven (7) nor be less than three (3) except as
permitted by law and the Charter of the Corporation. The tenure of office of a
director shall not be affected by any decrease or increase in the number of
directors so made by the Board of Directors. In the event the number of
directors is increased in advance of any annual meeting of stockholders, the
Board of Directors shall elect a director or directors to fill such vacancies
until the next annual meeting of stockholders, and shall appoint them to a
class.

(C) During the time that the Corporation is to qualify as a real estate
investment trust ("REIT"), except in the case of a vacancy, a majority of the
Board of Directors shall be Independent Directors (as hereinafter defined). For
purposes of these Bylaws, "Independent Director" shall mean a director of the
Corporation who is not affiliated, directly or indirectly, with any person or
entity, if any, responsible for directing or performing the day-to-day business
affairs of the Corporation (the "Manager"), whether by ownership of, ownership
interest in, employment by, any material business or professional relationship
with, or service as an officer or director of the Manager or an affiliated
business entity of the Manager; PROVIDED, HOWEVER, that a director shall not be
considered an Independent Director if he or she is serving as a director of more
than three REITs organized by the Manager or its affiliated business entities.
"Affiliate" means, when used with reference to a specified person, (i) any
person that directly or indirectly controls or is controlled by or is under
common control with the specified person, (ii) any person that is an officer of,
partner in or trustee of, or serves in a similar capacity with respect to, the
specified person or of which the specified person is an officer, partner or
trustee, or with respect to which the specified person serves in a similar
capacity and (iii) any person that, directly or indirectly, is the beneficial
owner of five percent (5%) or more of any class of equity securities of the
specified person or of which the specified person is directly or indirectly the
owner of five percent (5%) or more of any class of equity securities ("person"
includes any individual, corporation, partnership, trust, or other entity).
Directors need not be stockholders in the Corporation.

SECTION 2. POWER. All the powers of the Corporation are vested in and shall be
exercised by the Board of Directors except as otherwise prescribed by statute,
by the Charter or by these Bylaws. If the entire Board of Directors should
become vacant, any stockholder may call a special meeting and Directors for the
unexpired term may be elected at the said special meeting in the same manner as
provided for their election at annual meetings.

SECTION 3. VACANCIES. Any vacancy occurring on the Board of Directors for any
cause other than by reason of an increase in the number of directors may,
subject to the provisions of Section 5, be filled by a majority of the remaining
members of the Board of Directors, although such majority may be less than a
quorum; provided, however, that if the Corporation has sought to qualify as a
REIT and in accordance with Section 1 of this Article IV a majority of the Board
of Directors are required to be Independent Directors, then Independent
Directors shall nominate replacements for vacancies among the Independent
Directors, which must be elected by a majority of the directors, including a
majority of the Independent Directors. Any vacancy occurring by reason of an
increase in the number of directors may be filled by action of a majority of the
entire Board of Directors including a majority of Independent Directors. If the
stockholders of any class or series are entitled separately to elect one or more
directors, a majority of the remaining directors elected by that class or series
or the sole remaining director elected by that class or series may fill any
vacancy among the number of directors elected by that class or series. A
director elected by the Board of Directors to fill a vacancy shall be elected to
hold office until the next annual meeting of stockholders and until his or her
successor is elected and qualified.







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SECTION 4. RESIGNATIONS. Any director or member of a committee may resign at any
time. Such resignation shall be made in writing and shall take effect at the
time specified therein, or if no time be specified, at the time of the receipt
by the Chairman of the Board, the President or the Secretary.

SECTION 5. REMOVAL. At any meeting of stockholders duly called and at which a
quorum is present, the stockholders may, by the affirmative vote of the holders
of a majority of the votes entitled to be cast thereon, remove any director or
directors from office with, but not without, cause, and may elect a successor or
successors to fill any resulting vacancies for the unexpired terms of removed
directors.

SECTION 6. COMMITTEES OF THE BOARD. The Board of Directors may appoint from
among its members, an executive committee and other committees comprised of one
or more directors. A majority of the members of any committee, except the
executive committee, so appointed shall be Independent Directors. If the
Corporation lists its shares on a national securities exchange or on the
National Association of Securities Dealers, Inc.'s Automated Quotation System
("NASDAQ"), the Board of Directors shall appoint an audit committee comprised of
not less than two (2) members, all of whom are Independent Directors. The Board
of Directors may delegate to any committee any of the powers of the Board of
Directors except the power to fill vacancies on the Board of Directors, declare
dividends or distributions on stock, recommend to the stockholders any action
which requires stockholder approval, amend or repeal the Bylaws, approve any
merger or share exchange which does not require stockholder approval or issue
stock. If, however, the Board of Directors has given general authorization for
the issuance of stock, a committee of the Board, in accordance with a general
formula or method specified by the Board of Directors by resolution or by
adoption of a stock option plan, may fix the terms of stock subject to
classification or reclassification and the terms on which any stock may be
issued.

Notice of committee meetings shall be given in the same manner as notice for
special meetings of the Board of Directors.

The Board of Directors may designate a chairman of any committee, and such
chairman may fix the time and place of its meetings unless the Board shall
otherwise provide. In the absence or disqualification of any member of any such
committee, the members thereof present at any meeting and not disqualified from
voting, whether or not they constitute a quorum, may unanimously, if there are
only two members, or by a majority, if there are more than two members, appoint
another director to act at the meeting in the place of such absent or
disqualified members; provided, however, that in the event of the absence or
disqualification of an Independent Director, such appointee shall be an
Independent Director.

Each committee shall keep minutes of its proceedings and shall report the same
to the Board of Directors at the meeting next succeeding, and any action by the
committees shall be subject to revision and alteration by the Board of
Directors, provided that no rights of third persons shall be affected by any
such revision or alteration.

Subject to the provisions hereof, the Board of Directors shall have the power at
any time to change the membership of any committee, to fill all vacancies, to
designate alternative members to replace any absent or disqualified member, or
to dissolve any such committee.

SECTION 7. MEETINGS OF THE BOARD OF DIRECTORS. Meetings of the Board of
Directors, regular or special, may be held at any place in or out of the State
of Maryland as the Board may from time to time determine or as shall be
specified in the notice of such meeting.

Members of the Board of Directors may participate in a meeting by means of a
conference telephone or similar communications equipment if all persons
participating in the meeting can hear each other at the same time. Participation
in a meeting by such means constitutes presence in person at a meeting.

The first meeting of each newly elected Board of Directors shall be held as soon
as practicable after the annual meeting of the stockholders at which the
directors were elected. The meeting may be held at such time and place as shall
be specified in a notice given as hereinafter provided for special meetings of
the Board of Directors, or as shall be specified in a written waiver signed by
all of the directors as provided in Section 8, except that no notice shall be
necessary if such meeting is held immediately after the adjournment, and at the
site, of the annual meeting of stockholders.







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Special meetings of the Board of Directors may be called at any time by two (2)
or more directors or by a majority of the members of the executive committee, if
one be constituted, in writing with or without a meeting of such committee, or
by the Chairman of the Board or the President. Special meetings may be held at
such place or places in or out of the State of Maryland as may be designated
from time to time by the Board of Directors; in the absence of such designation,
such meetings shall be held at such places as may be designated in the notice of
meeting.

Notice of the place and time of every meeting of the Board of Directors shall be
delivered by the Secretary to each director either personally or by telephone,
telegraph, overnight courier or facsimile, or by leaving the same at his
residence or usual place of business at least twenty-four (24) hours before the
time at which such meeting is to be held or, if by first-class mail, at least
four (4) days before the day on which such meeting is to be held. If mailed,
such notice shall be deemed to be given when deposited in the United States mail
addressed to the director at his post office address as it appears on the
records of the Corporation, with postage thereon paid.

SECTION 8. INFORMAL ACTION BY DIRECTORS. Unless otherwise provided by law, any
action required to be taken at a meeting of the directors or any other action
which may be taken at a meeting of the directors may be taken without a meeting
if a consent in writing, setting forth the action so taken, shall be signed by
all of the directors.

SECTION 9. QUORUM AND VOTING. At all meetings of the Board, a majority of the
entire Board of Directors shall constitute a quorum for the transaction of
business, and the action of a majority of the directors present at any meeting
at which a quorum is present shall be the action of the Board of Directors
unless the concurrence of a greater proportion is required for such action by
law, the Corporation's Charter or these Bylaws. If a quorum shall not be present
at any meeting of the directors, the directors present thereat may, by a
majority vote, adjourn the meeting from time to time, without notice other than
announcement at the meeting of the time, date and place of the next meeting of
the directors, until a quorum shall be present.

SECTION 10. ORGANIZATION. The Chairman of the Board shall preside at each
meeting of the Board of Directors. In the absence or inability of the Chairman
of the Board to preside at a meeting, the President or, in his absence or
inability to act, another director chosen by a majority of the directors
present, shall act as chairman of the meeting and preside thereat. The Secretary
(or, in his absence or inability to act, any person appointed by the chairman of
the meeting) shall act as Secretary of the meeting and keep the minutes thereof.

SECTION 11. COMPENSATION OF DIRECTORS. Independent Directors shall receive a
stated salary for their services or a fixed sum, and expenses of attendance at
each regular or special meeting of the Board of Directors, or of any committee
thereof or both, as may be determined from time to time by the Board. Nothing
herein contained shall be construed to preclude any director from serving the
Corporation in any other capacity and receiving compensation therefor.

SECTION 12. MANAGEMENT ARRANGEMENTS. The Board of Directors may delegate the
duty of management of the assets and the administration of the Corporation's
day-to-day operations to a Manager pursuant to a written contract or contracts,
or any extension thereof, which have obtained the requisite approvals of the
Board of Directors, including a majority of the Independent Directors, or the
stockholders of the Corporation, as provided in the Charter.

All transactions involving the Corporation in which the Manager has an interest
must be approved by a majority of the Independent Directors.

The Board of Directors shall evaluate the performance of the Manager before
entering into or renewing any management arrangement. The minutes of meetings
with respect to such evaluation shall reflect the criteria used by the Board of
Directors in making such evaluation. Upon any termination of the initial
management arrangements reflected in the Registration Statement, the Board of
Directors shall determine (a) to perform the management function for the
Corporation, and (b) to justify the compensation provided for in its contract
with the Corporation. The initial contract for the services of a Manager entered
into by the Board of Directors shall have a term of no more than two (2) years,
renewable at or prior to expiration of the contract. Each contract shall be
terminable without cause by a majority of the Independent Directors or the
Manager on sixty (60) days' written notice.







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The Independent Directors shall determine at least annually, following the
Manager's initial term, that the compensation which the Corporation contracts to
pay the Manager is reasonable in relation to the nature and quality of services
performed and also shall supervise performance of the Manager and the
compensation paid to it by the Corporation to determine that the provisions of
such contract are being carried out. Each such determination shall be based upon
the following factors and all other factors the Independent Directors may deem
relevant and the findings of the Independent Directors on each of such factors
shall be recorded in the minutes of the Board of Directors:

    (A) the size of the management fee in relation to the size, compensation and
profitability of the investment portfolio of the Corporation;

        (B) the success of the Manager in generating opportunities that meet the
investment objectives of the Corporation;

        (C) the rates charged to other corporations similar to the Corporation
and to other investors by advisors performing similar services;

        (D)  additional revenues realized by the Manager and its affiliates
through their relationship with the Corporation, including loan administration,
underwriting or other commissions, fees for issuance and administration services
in connection with issuances of structured securities and other fees, whether
paid by the Corporation or by others with whom the Corporation does business;

        (E) the quality and extent of service and advice furnished to the
Corporation;

        (F)  the performance of the investment portfolio of the Corporation,
including income, conservation or appreciation of capital, frequency of problem
investments and competence in dealing with distress situations; and

        (G) the quality of the investment portfolio of the Corporation in
relationship to the investments generated by the Manager for its own account.

SECTION 14. TOTAL EXPENSES. The Independent Directors shall determine, from time
to time to time but at least annually, that the total fees and expenses of the
Corporation are reasonable in light of all relevant factors.

SECTION 15. INVESTMENT POLICIES AND RESTRICTIONS. It shall be the duty of the
Board of Directors to ensure that the purchase, sale, retention and disposal of
the Corporation's assets, and the investment policies of the Corporation and the
limitations thereon or amendment thereof are at all times:

(A) consistent with such policies, limitations and restrictions recited in the
registration statement on Form S-11, as amended (the "Registration Statement"),
filed with the Securities and Exchange Commission in connection with this
Corporation's initial public offering of common stock (the "Initial Public
Offering"); and

(B) in compliance with the restrictions applicable to REITs pursuant to the
Internal Revenue Code of 1986, as amended.

                                   ARTICLE V
                                    OFFICERS

SECTION 1. OFFICERS. The officers of the Corporation shall be a Chairman of the
Board, a President, a Treasurer and a Secretary, who shall be elected by the
Board of Directors to serve for one year and until their respective successors
are elected and qualified, except as otherwise provided in any employment
agreement between the Corporation and any officer. The President shall always be
a member of the Board of Directors. The Board of Directors may also appoint one
or more Vice Presidents. The same person may hold any two or more offices except
those of President and Vice President.

SECTION 2. SUBORDINATE OFFICERS, COMMITTEES AND AGENTS. The Board of Directors
may from time to time elect such officers and appoint such committees, employees
or other agents as the business of the Corporation may require, including one or
more assistant secretaries, and one or more assistant treasurers, each of








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whom shall hold office for such period, have such authority, and perform such
duties as are provided in these Bylaws, or as the Board of Directors may from
time to time determine. The directors may delegate to any officer or committee
the power to elect subordinate officers and to retain or appoint employees or
other agents.

SECTION 3. PRESIDENT. The President shall, subject to the control of the
directors, in general supervise and control all of the business and affairs of
the Corporation. He may sign any deeds, mortgages, bonds, contracts, or other
instruments which the directors have authorized to be executed, except in cases
where the signing and execution thereof shall be expressly delegated by the
directors or by these Bylaws to some other officer or agent of the Corporation,
or shall be required by law to be otherwise signed or executed; and in general
shall perform all duties incident to the office of president and such other
duties as may be prescribed by the directors from time to time.

SECTION 4. VICE PRESIDENT. In the absence of the President or in event of his
death, inability or refusal to act, the Vice President shall perform all the
powers of and subject to all the restrictions upon, the President. The Vice
President shall perform such other duties as from to time may be assigned to him
by the President or by the directors.

SECTION 5. SECRETARY. The Secretary shall keep the minutes of the stockholders'
and of the directors' meetings in one or more books provided for that purpose,
see that all notices are duly given in accordance with the provisions of these
Bylaws or as required, be custodian of the corporate records and of the seal of
the Corporation and keep a register of the post office address of each
Stockholder which shall be furnished to the Secretary by such stockholder, have
general charge of the stock transfer books of the Corporation and, in general,
perform all duties incident to the office of Secretary and such other duties as
from time to time may be assigned to him by the President or by the directors.

SECTION 6. TREASURER. The Treasurer shall have charge and custody of and be
responsible for all funds and securities of the Corporation; receive and give
receipts for moneys due and payable to the Corporation from any source
whatsoever, and deposit all such moneys in the name of the Corporation in such
banks, trust companies or other depositories as shall be selected in accordance
with these Bylaws and in general perform all of the duties incident to the
office of Treasurer and such other duties as from time to time may be assigned
to him by the President or by the directors.

SECTION 7. OTHER OFFICERS. The other officers of the Corporation shall perform
such duties as the President may from time to time assign to them.

SECTION 8. REMOVAL. Any officer elected by the Board of Directors may be
removed, either for or without cause, at any time upon the vote of a majority of
the Board of Directors. Any other employee of the Corporation may be removed or
dismissed at any time by the President.

SECTION 9. RESIGNATION. Any officer or agent may resign at any time by giving
written notice to the Board of Directors, or to the President or to the
Secretary of the Corporation. Any such resignation shall take effect at the date
of the receipt of such notice or at any later time specified therein, the
acceptance of such resignation shall not be necessary to make it effective.

SECTION 10. VACANCIES. A vacancy in any office because of death, resignation,
removal, disqualification, or any other cause, shall be filled by the Board of
Directors or by the officer or remaining members of the committee to which the
power to fill such office has been delegated pursuant to Section 2 of this
Article, as the case may be, and if the office is one for which these Bylaws
prescribe a term, shall be filled for the unexpired portion of the term.

SECTION 11. SALARIES. The salaries of the officers elected by the Board of
Directors shall be fixed from time to time by the Board of Directors or by such
officer as may be designated by resolution of the Board. The salaries or other
compensation of any other officers, employees and other agents shall be fixed
from time to time by the officer or committee to which the power to elect such
officers or to retain or appoint such employees or other agents has been
delegated pursuant to Section 2 of this Article. No officer shall be prevented
from receiving such salary or other compensation by reason of the fact that he
is also a director of the Corporation.







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                                   ARTICLE VI
                                   SIGNATURES

SECTION 1. NEGOTIABLE INSTRUMENTS. All checks, drafts or notes of the
Corporation shall be signed and/or countersigned by such officer, officers,
agent or agents of the Corporation as may be so designated from time to time by
the Board of Directors of the Corporation.

SECTION 2. STOCK TRANSFER. All endorsements, assignments, stock powers or other
instruments of transfer of securities standing in the name of the Corporation
shall be executed for and in the name of the Corporation by the President or
Vice President or by such officer as the Board of Directors may designate.

                                  ARTICLE VII
                                  FISCAL YEAR

The fiscal year of the Corporation shall end on the last day of each calendar
year.

                                  ARTICLE VIII
                                WAIVER OF NOTICE

Whenever, under the provisions of these Bylaws or of any law, the stockholders
or Directors are authorized to hold any meeting after notice, or after the lapse
of any prescribed period of time, such meeting may be held without notice, or
without such lapse of time, by the written waiver of such notice signed by every
person entitled to notice, or if every person entitled to notice shall be
present at such meeting.

                                   ARTICLE IX
                                   AMENDMENTS

SECTION 1. GENERAL AMENDMENTS. These Bylaws, except as otherwise provided in
Section 2 of this Article IX, may be amended, added to, rescinded or repealed
either: (1) by the vote of the stockholders entitled to cast at least a majority
of the votes which all stockholders are entitled to cast thereon at any duly
organized annual or special meeting of stockholders; or (2) with respect to
those matters which are not by statute reserved exclusively to the stockholders,
by vote of a majority of the Board of Directors, including a majority of the
Independent Directors in office at any regular or special meeting of directors
(except for provisions specifying that a majority vote of the Independent
Directors is required for the approval of certain matters, which provision may
be amended, added to, rescinded or repealed only with the approval of a majority
of the Independent Directors).

SECTION 2. CLASSIFIED BOARD AMENDMENTS. A vote of the stockholders entitled to
cast at least two-thirds of all the votes entitled to be cast thereon at any
duly held annual or special meeting of stockholders or a vote of 80% of the
Board of Directors is required to amend, alter, change, repeal or adopt any
provisions inconsistent with Article IV, Section 1 of these Bylaws.


                                   ARTICLE X
                                INDEMNIFICATION

SECTION l. PROCEDURE. Any indemnification, or payment of expenses in advance of
the final disposition of any proceeding, shall be made promptly, and in any
event within sixty (60) days, upon the written request of the director or
officer entitled to seek indemnification (the "Indemnified Party"). The right to
indemnification and advances hereunder shall be enforceable by the Indemnified
Party in any court of competent jurisdiction, if (i) the Corporation denies such
request, in whole or in part, or (ii) no disposition thereof is made within
sixty (60) days. The Indemnified Party's costs and expenses incurred in
connection with successfully establishing his or her right to indemnification,
in whole or in part, in any such action shall also be reimbursed by the
Corporation. It shall be a defense to any action for advance for expenses that
(a) a determination has been made that the facts then known to those making the
determination would preclude indemnification or (b) the Corporation has not
received either (i) an undertaking as required by law to repay








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such advances in the event it shall ultimately be determined that the standard
of conduct has not been met or (ii) a written affirmation by the Indemnified
Party of such Indemnified Party's good faith belief that the standard of conduct
necessary for indemnification by the Corporation has been met.

SECTION 2. EXCLUSIVITY, ETC. The indemnification and advance of expenses
provided by the Charter and these Bylaws shall not be deemed exclusive of any
other rights to which a person seeking indemnification or advance of expenses
may be entitled under any law (common or statutory), or any agreement, vote of
stockholders or disinterested directors or other provision that is consistent
with law, both as to action in his or her official capacity and as to action in
another capacity while holding office or while employed by or acting as agent
for the Corporation and such rights shall continue in respect of all events
occurring while a person was a director or officer after such person has ceased
to be a director or officer, and shall inure to the benefit of the estate,
heirs, executors and administrators of such person. All rights to
indemnification and advance of expenses under the Charter of the Corporation and
hereunder shall be deemed to be a contract between the Corporation and each
director or officer of the Corporation who serves or served in such capacity at
any time while this Bylaw is in effect. Nothing herein shall prevent the
amendment of this Bylaw, provided that no such amendment shall diminish the
rights of any person hereunder with respect to events occurring or claims made
before its adoption or as to claims made after its adoption in respect of events
occurring before its adoption. Any repeal or modification of this Bylaw shall
not in any way diminish any rights to indemnification or advance of expenses of
such director or officer or the obligations of the Corporation arising hereunder
with respect to events occurring, or claims made, while this Bylaw or any
provision hereof is in force.

SECTION 3. SEVERABILITY; DEFINITIONS. The invalidity or unenforceability of any
provision of this Article X shall not affect the validity or enforceability of
any other provision hereof.

                                   ARTICLE XI
                            MISCELLANEOUS PROVISIONS

SECTION 1. BOOKS AND RECORDS. The Corporation shall keep correct and complete
books and records of its accounts and transactions and minutes of the
proceedings of its stockholders and Board of Directors and of any executive or
other committee when exercising any of the powers of the Board of Directors. The
books and records of the Corporation may be in written form or in any other form
which can be converted within a reasonable time into written form for visual
inspection. Minutes shall be recorded in written form but may be maintained in
the form of a reproduction. The original or a certified copy of the Bylaws shall
be kept at the principal office of the Corporation.

SECTION 2. VOTING SHARES IN OTHER CORPORATIONS. Stock of other corporations or
associations, registered in the name of the Corporation, may be voted by the
President, a Vice President, or a proxy appointed by either of them. The Board
of Directors, however, may by resolution appoint some other person to vote such
shares, in which case such person shall be entitled to vote such shares upon the
production of a certified copy of such resolution.

SECTION 3. ANNUAL STATEMENT OF AFFAIRS. The President or chief accounting
officer shall prepare annually a full and correct statement of the affairs of
the Corporation, to include a balance sheet and a financial statement of
operations for the preceding fiscal year. The statement of affairs shall be
submitted at the annual meeting of the stockholders and, within 20 days after
the meeting, placed on file at the Corporation's principal office.

SECTION 4. MAIL. Except as herein expressly provided, any notice or other
document which is required by these Bylaws to be mailed shall be deposited in
the United States mails, postage prepaid.

SECTION 5. RELIANCE. Each director, officer, employee and agent of the
Corporation shall, in the performance of his or her duties with respect to the
Corporation, be fully justified and protected with regard to any act or failure
to act in reliance in good faith upon the books of account or other records of
the Corporation, upon the opinion of counsel or upon reports made to the
Corporation by any of its officers or employees or by the adviser, accountants,
appraisers or other experts or consultants selected by the Board of Directors or
officers of the Corporation, regardless of whether such counsel or expert may
also be a director.

SECTION 6. CERTAIN RIGHTS OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS. The
directors shall have no responsibility to devote their full time to the affairs
of the Corporation. Any director or officer, employee or agent of the
Corporation, in his or her personal capacity or in a capacity as an affiliate,
employee or agent of any








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other person, or otherwise, may have business interests and engage in business
activities similar to or in addition to those of or relating to the Corporation.



                       CLARION COMMERCIAL HOLDINGS, INC.
                      RESOLUTION OF THE BOARD OF DIRECTORS
                                 MARCH 10, 1999

WHEREAS, the Board of Directors deems it advisable and in the best interests of
the Corporation to amend the Bylaws of the Corporation (the "Bylaws"), in
general, with respect to setting the date of the annual meeting of stockholders.

NOW THEREFORE, BE IT RESOLVED, That pursuant to Section I of Article IX of the
Bylaws, the Board of Directors hereby adopts and approves the following
amendment to the Bylaws:

     Section I of Article III of the Bylaws is hereby amended to delete the
     words "determined by the Board of Directors which time and date shall be
     within one hundred eighty (180) days after the last day of the
     Corporation's fiscal year", and to substitute in lieu thereof the words
     "during the month of May set by the Board of Directors". 



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