Nirro Group Holding

AFRICA ISRAEL INVESTMENTS BUYS ADDITIONAL SHARES FROM NIRRO GROUP

26 January 2011

AFI Development PLC ("AFI Development" or the "Company") today reports that its major shareholder, Africa Israel Investments, has announced that it has agreed to purchase approximately 9.7% of the aggregate equity and voting rights in AFI Development (the "Holdings") from a company wholly-owned by Mr. Alexander Khaldey, the General Director of AFI Development. This sale represents a disposal of Mr. Khaldey's entire shareholding in the Company.

Africa Israel Investments will purchase the Holdings for a total consideration of approximately USD 129 million. The consideration under the Agreement, as specified above, assuming the completion of both stages of the transaction, reflects a weighted price of approximately USD 1.27 per each share or GDR of AFI Development.

The transaction will be carried out in two stages, with 2.96% of the equity and voting rights in AFI Development being transferred upon execution of the agreement and the remainder of the Holdings being transferred in May 2011. The completion of the transactions are subject to the fulfilment of a number of conditions. Once these have been met, Africa Israel Investments will hold approximately 64% of the equity and voting rights in AFI Development. Alexander Khaldey will continue to serve as General Director of AFI Development.

Izzy Cohen, CEO of Africa Israel Investments, commented: "This agreement confirms the long term commitment of Africa Israel Investments to AFI Development. We continue to see major growth opportunities in the Russian real estate sector and Moscow in particular, which AFI Development is uniquely positioned to realise."

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For further information, please contact:

AFI Development

Stanislav Joukov +7 495 796 9988

Natalia Ivanova

Citigate Dewe Rogerson, London +44 20 7638 9571

David Westover

Sandra Novakov

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 29 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.