Linear processing in the spatial domain at the base stations (BSs) and at the users of MIMO cellular systems enables the control of both inter-cell and intra-cell interference. A number of iterative algorithms have been proposed that allow the BSs and the users to calculate the transmit-side and the receive-side linear processors in a distributed manner via message exchange based only on local channel state information. In this paper, a novel such strategy is proposed that requires the exchange of unitary matrices between BSs and users. Specifically, focusing on a general both uplink- and downlink-operated cells, the design of the linear processors is obtained as the alternating optimization solution of the problem of minimizing the weighted sum of the downlink and uplink inter-cell interference powers and of the signal power leaked in the space orthogonal to the receive subspaces. Intra-cell interference is handled via minimum mean square error (MMSE) or the zero-forcing (ZF) precoding for downlink-operated cells and via joint decoding for the uplink-operated cells. Numerical results validate the advantages of the proposed technique with respect to existing similar techniques that account only for the interference power in the optimization.