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                    AvalonBay: Dividend Distributions



For Immediate News Release
January 18, 1999


                   AVALONBAY COMMUNITIES, INC. ANNOUNCES
      INCOME ALLOCATIONS OF 1998 COMMON AND PREFERRED SHARE DIVIDEND
                               DISTRIBUTIONS

AVALONBAY COMMUNITIES, INC.  (NYSE/PCX: "AVB") reported today the
following taxable allocations of the 1998 dividend distributions on its
Common Stock and Preferred Stock.  In June 1998, Avalon Properties, Inc.
("Avalon") merged with and into Bay Apartment Communities, Inc. ("Bay"),
with Bay as the surviving corporation.  In connection with the merger, Bay
changed its name to AvalonBay Communities, Inc.  Distribution information
for Avalon and Bay reporting as independent companies for the period
January 1, 1998 through June 3, 1998 is also presented below.


                                                                Unrecap-
Declara-                     Distri-   Taxable   Return   20%    tured
  tion     Record   Payable  bution    Ordinary    of    Rate   Section
  Date      Date     Date   Per Share   Income   Capital Gain  1250 Gain
--------  -------- -------- ---------  --------  ------- ----- ---------
                                                                   

Avalon Properties, Inc.
-----------------------                                             

Common Shares (CUSIP #053469102)                                   
01/22/98  02/06/98 02/07/98   $0.3900     56.0%   44.0%   0.0%     0.0%
04/21/98  05/04/98 05/15/98   $0.3900     56.0%   44.0%   0.0%     0.0%
                     Totals:  $0.7800     56.0%   44.0%   0.0%     0.0%
                                                                    
Preferred Shares Series A (CUSIP #053469201)
01/22/98  02/06/98 02/17/98   $0.5625    100.0%    0.0%   0.0%     0.0%
04/21/98  05/04/98 05/15/98   $0.5625    100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.1250    100.0%    0.0%   0.0%     0.0%
                                                                   
Preferred Shares Series B (CUSIP #053469300)
01/22/98  02/06/98 02/17/98   $0.5600    100.0%    0.0%   0.0%     0.0%
04/21/98  05/04/98 05/15/98   $0.5600    100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.1200    100.0%    0.0%   0.0%     0.0%

                                                                   
Bay Apartment Communities, Inc.
-------------------------------

Common Shares (CUSIP #072012107)                                  
03/16/98  03/31/98 04/15/98   $0.4200     77.0%    0.0%   9.0%    14.0%
                     Totals:  $0.4200     77.0%    0.0%   9.0%    14.0%
                                                                   
Preferred Shares Series A (CUSIP #N/A)
12/09/97  12/31/97 02/13/98   $0.4326    100.0%    0.0%   0.0%     0.0%
03/16/98  03/31/98 05/15/98   $0.4326    100.0%    0.0%   0.0%     0.0%
                     Totals:  $0.8652    100.0%    0.0%   0.0%     0.0%
                                                                   
Preferred Shares Series B (CUSIP #072012206)
12/09/97  12/31/97 02/13/98   $0.4326    100.0%    0.0%   0.0%     0.0%
03/16/98  03/31/98 05/15/98   $0.4326    100.0%    0.0%   0.0%     0.0%
                     Totals:  $0.8652    100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series C (CUSIP #072012305)
12/09/97  03/01/98 03/31/98   $0.53125   100.0%    0.0%   0.0%     0.0%
                     Totals:  $0.53125   100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series D (CUSIP #072012404)
02/19/98  03/01/98 03/13/98   $0.4834    100.0%    0.0%   0.0%     0.0%
                     Totals:  $0.4834    100.0%    0.0%   0.0%     0.0%

                                                                    
AvalonBay Communities, Inc.                                         
---------------------------

Common Shares (CUSIP #053484101)                                  
06/19/98  06/30/98 07/15/98   $0.5100     77.0%    0.0%   9.0%    14.0%
08/31/98  09/30/98 10/15/98   $0.5100     77.0%    0.0%   9.0%    14.0%
12/07/98  12/31/98 01/15/99   $0.5100     77.0%    0.0%   9.0%    14.0%
                     Totals:  $1.5300     77.0%    0.0%   9.0%    14.0%
                                                                    
Preferred Shares Series C (CUSIP #053484200)
03/16/98  06/01/98 06/15/98   $0.53125   100.0%    0.0%   0.0%     0.0%
06/19/98  09/01/98 09/15/98   $0.53125   100.0%    0.0%   0.0%     0.0%
08/31/98  12/01/98 12/15/98   $0.53125   100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.59375   100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series D (CUSIP #053484309)
03/16/98  06/01/98 06/15/98   $0.5000    100.0%    0.0%   0.0%     0.0%
06/19/98  09/01/98 09/15/98   $0.5000    100.0%    0.0%   0.0%     0.0%
08/31/98  12/01/98 12/15/98   $0.5000    100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.5000    100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series F (CUSIP #053484507)
06/16/98  08/03/98 08/14/98   $0.5625    100.0%    0.0%   0.0%     0.0%
08/31/98  11/02/98 11/13/98   $0.5625    100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.1250    100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series G (CUSIP #053484606)
06/19/98  08/03/98 08/14/98   $0.5600    100.0%    0.0%   0.0%     0.0%
08/31/98  11/02/98 11/13/98   $0.5600    100.0%    0.0%   0.0%     0.0%
                     Totals:  $1.1200    100.0%    0.0%   0.0%     0.0%
                                                                    
Preferred Shares Series H (CUSIP #053484705)
11/13/98  12/03/98 12/15/98   $0.3625     36.3%    0.0%   0.0%     0.0%
                     Totals:  $0.3625     36.3%    0.0%   0.0%     0.0%



The Company did not incur any foreign taxes.  The information above presents
final income allocations.

AvalonBay is an equity REIT operating in the high barrier-to-entry markets
of the United States.  The Company owns 141 communities totaling 41,173
apartment homes in 29 distinct markets, of which 14 communities are under
construction and 13 are under redevelopment.  In addition, the Company
holds future development rights for 27 communities.  For more information
on AvalonBay, visit the Company's web site at http://www.avalonbay.com.
For additional information, please contact Thomas J. Sargeant, CFO, at
(703) 317-4635.



End. 


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