Project Acquisition

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION

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

AFI Development PLC - Potential Acquisition

London, 10 April 2012 - AFI Development PLC ("AFI Development" or "the Company") today announces that it is in preliminary stages of evaluating a transaction with a private company controlled by Mr. Lev Leviev ("the Seller"), pursuant to which AFI Development may acquire a shareholding between 80% to 90% in a Russian company developing a residential project in the Moscow Region ("the Project"). It is contemplated that AFI Development will issue new shares of the Company to the Seller as consideration for the acquisition. The amount of AFI Development shares to be issued will be based on the fairness opinion of the Company's sponsor, taking into account, inter alia, independent appraisal of the Project.

The completion of the transaction will, should the Company believe it to be in the best interests of the Company to acquire a share in the Project, be subject to shareholder approval in due course. The Company notes that its majority shareholder, Africa-Israel Investments Ltd., will not be entitled to participate in any shareholder vote to approve the acquisition of the Project.

Currently the Project comprises more than 1,000 residential units, which are partially detached family homes and partially apartments within multi-storey buildings. The Project is currently in the construction stage of development. The Company believes that the Project presents an attractive opportunity to increase its cash flow with revenue generated from the on-going sale of residential units offered by the Project.

A further announcement will be made by the Company when appropriate.

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For further information, please contact:

AFI Development, +7 495 796 9988

Alexander Adadurov

Ilya Kutnov

Citigate Dewe Rogerson, London+44 20 7638 9571

David Westover

Sean Bride

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 across Russia, with Moscow being its main market.. The Company's existing portfolio 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.