COMPLETION OF FURTHER STAGE OF PURCHASE OF SHARES

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION

IN OR INTO THE RUSSIAN FEDERATION, THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN

COMPLETION OF A FURTHER STAGE OF THE PURCHASE OF ADDITIONAL

AFI DEVELOPMENT SHARES BY AFRICA ISRAEL INVESTMENTS

London, 26 May 2011 - AFI Development plc ("AFI Development" or "the Company") today reports that a further stage of the purchase of its shares by its major shareholder, Africa Israel Investments Ltd. ("Africa Israel Investments") from companies wholly-owned by Mr. Alexander Khaldey, (the "Sellers") was completed on 25 May 2011. At this stage the Sellers have transferred to Africa Israel Investments part of the equity and voting rights in the Company which constitutes 1.61% of the equity and voting rights in the Company, for a consideration of US$20 million.

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For further information, please contact:

AFI Development

Alexander Adadurov +7 495 796 9988

Natalia Ivanova

Citigate Dewe Rogerson, London +44 20 7638 9571

David Westover

Lucie Holloway

About AFI Development

AFI Development is one of the leading real estate development companies operating in Russia. Established in 2001, AFI Development is a publicly traded subsidiary of Africa Israel Investments Ltd.

AFI Development is listed on the Main Market of the London Stock Exchange and aims to deliver shareholder value through a commitment to innovation and continuous project development, coupled with the highest standards of design, construction, and quality and customer service.

AFI Development focuses on developing and redeveloping high quality commercial and residential real estate assets in Moscow, the Moscow Region, and other major cities in Russia and the CIS. The Company's existing portfolio of 30 development projects comprises commercial projects focused on offices, shopping centers, hotels and mixed-use properties, and residential projects. AFI Development's strategy is to sell the residential properties it develops and to either lease the commercial properties or sell them for a favorable return.

AFI Development is a leading force in urban regeneration, breathing new life into city squares and neighborhoods and transforming congested and underdeveloped areas into thriving new communities. The Company's long-term, large-scale regeneration and city infrastructure projects establish the necessary groundwork for the successful launch of commercial and residential properties, providing a strong base for future.