AvalonBay: Construction Start in Peabody, MA



  AVALONBAY COMMUNITIES, INC. ANNOUNCES CONSTRUCTION START IN PEABODY, MA

(Alexandria, VA)  AvalonBay Communities, Inc. (NYSE/PCX Symbol:AVB) announced
today that it has begun construction of a new luxury apartment community,
Avalon Essex, on an 11.08 acre site on Prospect Street in Peabody, MA.
AvalonBay paid $4.8 million for the site, which is located between Route 128
and Route 114, and is adjacent to The North Shore Shopping Mall, a recently
renovated 1.4 million square foot regional mall. 

Avalon Essex will be the first luxury apartment community to be developed on
Boston's North Shore in over a decade.  The city of Peabody is the employment
and retail center of the North Shore, enjoying tremendous highway access and
benefiting from its close proximity to downtown Boston.

Avalon Essex will contain 154 luxury apartment homes, including 42 townhomes
and 112 garden style floorplans. Construction of the community commenced on
June first. The average apartment home will contain over 1,100 net rentable
square feet and will feature designer kitchens, large walk in closets and full
size washer and dryers. Many apartment homes will feature integral garages,
dens, lofts, & gas burning fireplaces.  

The garden style buildings will be configured around the pool area in a heavily
landscaped setting while the townhomes will be predominantly sited around a
village green.  Planned amenities include a handsomely appointed and spacious
community building of over 4,000 square feet with "Cardio-Theatre" state of the
art fitness equipment, a large clubroom, and a function patio.  The heated pool
will have a spa and residents will have use of the barbecue and gazebo.

Total development cost is projected to be $21.4 million.  The projected average
leased rent is expected to be $1,600 per month and the property is anticipated
to provide an initial stabilized yield on investment of 10.6%. 

Initial occupancy is expected in the 2nd quarter of 2000.  Construction
completion is anticipated in the 4th quarter of 2000, with stabilized occupancy
expected to be achieved by the 1st quarter of 2001.

About AvalonBay Communities

AvalonBay, named the NAHB Development Company of the year for 1998 and the
Property Management Company of the Year for 1996/1997, currently owns or holds
an ownership interest in 137 apartment communities containing 39,996 apartment
homes in sixteen states and the District of Columbia, of which thirteen
communities are under construction and twelve communities are under
reconstruction.  AvalonBay is an equity REIT in the business of developing,
redeveloping, acquiring and managing multifamily apartment communities in high
barrier-to-entry markets of the United States.  More information on AvalonBay
may be found on AvalonBay's Web Site at http://www.avalonbay.com.  For
additional information, please contact Richard L. Michaux, President and Chief
Executive Officer at (703) 317-4602 or Bryce Blair, Chief Operating Officer at
(617) 847-1250.

This release contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The forward-looking statements
contained in this release are statements that involve risks and uncertainties,
including, but not limited to, changes in the demand for apartment homes, the
effects of economic conditions, the impact of competition and competitive
pricing, changes in construction costs, the results of financing efforts,
potential acquisitions under agreement, the effects of the Company's accounting
policies and other matters detailed in the Company's filings with the
Securities and Exchange Commission, including the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1998 under the heading
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Forward-Looking Statements."  In addition, the cost of
construction, the scheduled completion date, and the anticipated rents and
return on investment of the community described in this release may be
different than currently anticipated by the Company.  Management generally
considers Funds from Operations ("FFO") to be an appropriate measure of the
operating performance of the Company because it provides investors an
understanding of the ability of the Company to incur and service debt and to
make capital expenditures.  FFO is determined in accordance with a definition
adopted by the Board of Governors of the National Association of Real Estate
Investment Trusts which may differ from the methodology for computing FFO used
by other REITs, and, accordingly, the Company's calculation of FFO may not be
comparable to such other REITs.  





Ends.