VTB Bank purchases parking space at AFIMALL City

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AFI DEVELOPMENT PLC

("AFI Development" or "the Company")

VTB Bank purchases parking space at afimall city

London, 22 November 2012 - AFI Development today announces that its subsidiary, Bellgate Construction Limited ("Bellgate"), has reached an agreement with VTB Bank OJSC ("VTB Bank") on the disposal of parking space in the underground parking at AFIMALL City. The parties expect the transaction to be executed in the coming weeks.

The transaction is structured in two stages. The first stage will entail a sale-purchase transaction between Bellgate and VTB Bank on 21,354 sq.m. of parking space. During the second stage 9,247 sq.m. owned (at completion) by VTB Bank will be exchanged for 7,847 sq. m. owned by Bellgate. The exchange transaction is to be completed no later than three years from the execution date of the sale-purchase transaction. This two-tier transaction structure stems from the fact that part of the parking space that VTB Bank is interested in purchasing is located on a land plot to which Bellgate has not yet registered leasehold rights.

The consideration for the sale-purchase transaction is US$57.1 million (excluding Russian VAT). The consideration for the exchange transaction, to be paid by Bellgate to VTB Bank, is US$2.6 million (excluding Russian VAT). All payments are to be made in Russian rouble. VTB Bank will be able to start using the parking space once the construction is fully completed by Bellgate. The resulting estimated total net cash flow for AFI Development is US$54.5 million.

The transaction documents do not specify the number of parking spaces being purchased by VTB Bank, which will be able to allocate parking spaces and plan the configuration of the acquired parking space at its own discretion. The parties estimate the eventual number of parking spaces transacted at 643.

Commenting on today's announcement, Mr Mark Groysman, Executive Director of AFI Development said: "We are pleased to announce that negotiations with our long term financing partner, VTB Bank, on the disposal of parking space at AFIMALL City has resulted in a mutually beneficial agreement. The bank will be able to provide employees located at its Moscow City headquarters with parking space they require, while Bellgate will receive disposal consideration that will help finance construction works in the parking complex. The transaction is not expected to have any negative influence on the parking capacity of AFIMALL City."

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For further information, please contact:

AFI Development, +7 495 796 9988

Ilya Kutnov

Ekaterina Shubina

Citigate Dewe Rogerson, London+44 20 7638 9571

David Westover

Reena MavjeeSandra Novakov

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 favourable 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.

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