GTC and EBRD to invest together in Ukraine. High demand for GTC apartments in Belgrade

EBRD will take a 10% stake in GTC Ukraine.
Over 60% of apartments in Park Apartments in Belgrade have been sold.

On 18 October 2006, Globe Trade Centre S.A. (GTC) and the European Bank
for Reconstruction and Development (EBRD)
signed an agreement under which EBRD will acquire 10% of the share capital of GTC Real Estate Investments Ukraine B.V. (GTC Ukraine), while GTC will hold 85.5% of the shares in GTC Ukraine.

The parties agreed on joint commitment of their equity in investments in Ukraine in an initial amount of up to USD 100 million (of which USD 10 million will come from EBRD). The amount
of the equity committed may be increased in the future as more new projects are acquired.

Part of GTC’s strategy in Ukraine is joint ventures with reliable local partners holding attractive sites in the larger cities. GTC is currently analyzing a number of potential projects, focusing on the office sector and shopping centers.

EBRD, established in 1991, is involved in co-financing of investment projects in 28 countries of the former Eastern bloc and the former Soviet Union. EBRD is the largest single investor in this part of the world. The shareholders of the bank are the governments of 60 nations, the European Union, and the European Investment Bank. In 2005 EBRD invested a total of EUR 4.3 billion in 151 projects. EBRD has co-operated with GTC for several years.

In 2000, EBRD took part in the increase of share capital of Globe Trade Centre S.A. The bank also co-finances a GTC investment in Belgrade: 19 Avenija, an office building with net area of 16,000 sq. m., and the adjoining Park Apartments, a residential complex, being built in New Belgrade, a prestigious district of the Serbian capital.

Construction of both developments is to be completed in the second half of 2007. The apartments are already attracting great interest from buyers; 120 out of 190 residences offered have already been sold. Negotiations are also at an advanced stage with renowned tenants for the office space.

In 2005, GTC completed GTC House in Belgrade, a Class A office building with an area of 13,500 sq. m. which is 100% let, chiefly to international institutions. EBRD’s Serbian headquarters are also located in GTC House.

GTC recently completed due diligence on real estate in the capital of Moldova, Chisinau, and in Sofia, Bulgaria, for which it had previously agreed on acquisition terms. The property in Chisinau was an office building, and in Sofia a plot of 4,500 sq. m. After analyzing the results of the due diligence and evaluating all risks related to the investments, GTC has decided to withdraw from both transactions.

GTC sells Mokotów Business Park and accelerates its expansion in Poland. Development of A-class office complex starts in Bucharest

GTC signs a preliminary agreement with Heitman to sell MBP in Warsaw.
New 30,000sqm office project in Wrocław acquired.
45,000 sqm office development in Bucharest already attracting big-name tenants.

On 11th October 2006 officials from 100%-owned subsidiaries of Globe Trade Centre S.A. (GTC) signed a preliminary agreement with counterparts from Heitman Property Partners III to sell Mokotów Business Park (MBP) for USD 287 million.
The transaction will contribute a pre-tax revaluation gain estimated at USD 40 million to the profit in Q3 2006.

MBP is the largest office complex in Central & Eastern Europe, offering 107,000sqm of net rentable area (NRA) in nine buildings. It has attracted renowned tenants, including some of the largest international corporations.

The execution of the final agreements should be completed no later than 31 March 2007, and is subject to the Buyer obtaining relevant permits.

The sale of Mokotów Business Park is part of GTC’s strategy to rebalance it’s property portfolio, divesting mature assets in Warsaw and accelerating the acquisition of new projects in other large Polish cities.

In 2006 GTC accelerated acquisition pace of new investments – projects with a total building rights of 550,000sqm have been acquired this year.

On 10th October GTC acquired a 1.3 hectare site for office development in Wrocław. A 30,000 sqm NRA office park will be built in an attractive location between the city centre and the booming economic zone in Kobierzyce. With its very good access to public transportation, and exposure to the main street, it will offer future tenants efficient office space with expansion potential. Construction of the first building is planned to start in mid-2007, once a building permit has been obtained.

Earlier this year GTC acquired office projects in Łódź, a 400-unit residential project in Kraków, and a 200-apartment project in Poznań, the latter two both being in prime residential locations.

In Poland GTC is currently undertaking more real estate projects than in the company’s history.

In Warsaw GTC is starting construction of three office developments. Nefryt building (15,000sqm NRA), the first building in Platinium Business Park (9,000sqm NRA) and Okęcie Business Park (8,500sqm NRA). In a prestigious suburbs of Warsaw – Konstancin – a third phase (8,400sqm) of Osiedle Konstancja, a prestigious residential project, is under construction.

In Kraków the Newton office building (10,000sqm NRA) has been fully let prior to completion, which is scheduled for Q1 2007, while construction of its twin building Edison is planned to commence this year.
In the centre of Wrocław GTC is already developing an A-class office building that will offer 14,000sqm of net rentable area.

However, the largest office building in GTC’s portfolio is being developed in Romania.
GTC, together with its partners, is going to start construction this year of two A-class office towers in a prime commercial location in Bucharest.

City Gate will have a total of 45,000sqm NRA in two buildings, which will be built simultaneously.

The project has already attracted a great deal of interest from international and domestic tenants. Heads of terms have been signed with one of the world’s largest banks and a leading European bank for a total of 10,000sqm. A further 12,000sqm is under advanced negotiations.
GTC expects that 100% of the office space in the City Gate complex will be leased well before completion.