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AFI Development PLC May 2008


Company Overview Leading Developer in a Strong Market

A leading real estate developer leveraged to the high growth Russian real estate market

Proven Track Record

Track record of value creation through executing innovative and visionary developments that act as a catalyst for urban regeneration

Attractive Portfolio and Pipeline

A portfolio of large-scale integrated development projects and a substantial longer term pipeline

Best-in-Class Execution

Local management team with proven track record and familiarity with local authorities and procedures International best-in-class execution from origination to completion

Value Enhancing Parent Company

Leverage parent's international expertise, business practices and relationships

June 2008 2


Geographical Expansion St. Petersburg Type: Retail GLA: 15,400 sqm

Moscow

Selective targeting of major Russian cities based on:

Volgograd

„ Population at or over 1 million

Type: Mixed Use GLA: 114,960

Perm Type: Mixed Use (in 3 Phases) Kislovodsk June 2008

GLA: 208,584

„ Strong, sustainable economic growth „ Shortage of highquality real estate

Type: Resort GLA: 31,500

3


Ukraine & the CIS ƒ Geographic focus broadened to include Ukraine and other CIS countries ƒ We have entered the Ukrainian market through acquisition of the assets and management platform of AFI Ukraine: ƒ In-depth local market knowledge – a solid

platform for growth ƒ A number of established development opportunities

ƒ Markets have highly complementary characteristics to Russia, with positive economic growth June 2008 4


Focus on Moscow and the Moscow Region Tverskaya Zastava

Moscow City Botanic Garden Pochtovaya

Ozerkovskaya

Otradnoye

Kuntsevo

Berezhkovskaya Kosinskaya

June 2008

Paveletskaya 5


Jones Lang LaSalle - Project Portfolio Summary Portfolio Breakdown by Asset Type (sqm)

Tverskaya Zastava

Shopping Centre

Shopping Centre

100%

70,203

225.6

625.5

2010

Plaza I

Offices, hotel, residential

100%

147,895

374.7

917.3

2011

Plaza II

Offices

100%

89,820

350.5

746.5

2011

Plaza II (a)

Offices

100%

7,823

17.9

47.9

2011

Plaza IV

Offices

95%

91,278

117.9

394.2

2011

222.1

264.5

1,142.5

1,648.8

Moscow

Ozerkovskaya

Moscow & Moscow Regions 90%

Regions 10%

Notes 1. Estimated Gross Lettable Area/ Gross Sellable Area 2. Adjusted for AFID beneficial ownership 3. Responsible for 100% of the costs and entitled to 75% of the revenues. With respect to the concert hall, AFID to contribute June 2008$20 MM of the costs, but has no ownership rights 4. AFID share is 50% of office and residential, 100% of hotel 5. This table does not include latest projects in Ukraine and Kislovodsk

Expected Completion

Asset Type

City

Portfolio Breakdown by Geography (sqm)

Valuation in Valuation at Current (2) (2) (3) State Completion $ MM $ MM

Project

Retail 15%

Office 60%

GLA/ (1) GSA sqm

Development

Res 25%

Hotel 2%

AFID Beneficial Ownership

Four Winds I

Offices

50%

25,988

Four Winds II

Residential

50%

36,421

Shopping Centre

Retail, offices, concert hall

75%(3)

97,451

City Hotel

Hotel

Phase II

Offices, hotel, residential

Phase III

Offices, residential

Phase IV

Offices

Otradnoye

Otradnoye

Residential, offices, retail

Paveletskaya

Paveletskaya Embankment

Offices

49.9% 50%

2008 2009

35,564

61.6

242.8

2010

54,2035

165.3

232.0

Completed / 2008

64,124

111.18

229.8

2008

(4)

50%

Completed

70%

21,574

64.8

164.2

2010

> 90%

596,460

405.9

1,701.6

2012

100%

67,000

57.5

325.4

2009

Plaza H2O

Offices

100%

8,918

34.9

34.9

Completed

Ruza

Ruza

Land plot

100%

-

94.8

235.2

2012

Berezhkovskaya

Berezhkovskaya

Offices

74%

99,600

101.9

280.9

2011

St. Petersburg

Discount centre project

Retail

76%

15,400

18.9

47.9

2010

Perm (Kama Gate)

Phase I - III

Residential, Office, Retail

30%

208,584

12.8

220.4

2010

Volgograd

Multi-functional complex

Retail, offices, hotel

100%

89,468

26.4

440.7

2011

Kuntsevo

Kuntsevo

Offices, retail

100%

1,275,414

700.3

7,624.0

2012

100%

51,625

8.0

113.1

2010

Kislovodsk

Kislovodsk

Spa Hotel, Retail, Entertainment

Kossinskaya

Kossinskaya

Offices, retail

100%

245,279

266.1

529.3

2010

Pochtovaya

Pochtovaya

Offices, residential

100%

160,945

258.2

1,029.2

2010

Botanic Garden

Serebryakova

Residential, Retail

90%

2010

Total

72,883

73.2

515.6

3,640,561

5,221.0

19,567.0

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Tverskaya Zastava Square ƒ Transforming look, zoning and use of a central square ƒ Over 450,000 sqm of gross leasable/sellable area across seven mixed-use commercial and residential developments: ƒ Largest underground shopping mall in Moscow ƒ Over 190,000 sqm of Class A office space across various buildings located in the proximity of the square

ƒ Projects hit market between 2007 and 2011 June 2008 7


Moscow City ƒ The Shopping Mall comprises over 130,000 sqm of retail and leisure space, a 6,000-seat concert hall, a five-star hotel and one of the largest squares in Moscow ƒ Located in the heart of the “Moscow City” district, Russia’s largest real estate development project with 1.25 mln sqm of high-quality office space being developed

June 2008 8


Ozerkovskaya Embankment Nearly 3 hectare river front neighbourhood development in the historic Moscow district of Zamoskvorechye ƒƒ Phase Phase II –– Aquamarine Aquamarine II office office building building completed completed and and sold sold pre pre IPO IPO ƒƒ Phase Phase IIII –– Aquamarine Aquamarine IIII office office building building –– completed completed and and sold sold ƒƒ Phase Phase IIII –– Hotel Hotel and and residential residential buildings buildings to to be be completed completed in in 2008 2008 ƒƒ Phase Phase III III –Mixed –Mixed use use office office building building currently currently under under construction construction

ƒ Phase IV Mixed use office building in concept and design stage June 2008 9


Otradnoye ƒ New district of suburban town of Odintsovo, 8 km west of Moscow ring road

ƒ Residential district development with almost 600,000 sqm of GLA/GSA ƒ 450,000 sqm of Economy + accommodations spread out among nine residential buildings

ƒ The compound will also include additional retail and office space ƒ The development is surrounded by woodlands and is regarded as an upscale outof-Moscow township June 2008 10


Kuntsevo ƒ 20 hectare development located in western Moscow near the Kuntsevo metro station and adjacent to the Rublevskoye highway ƒ Mixed-use commercial project totalling over 1.2 mln sqm comprising primarily Class A office space ƒ Phased development with last phase expected to be completed by 2012 June 2008 11


Pochtovaya • Multipurpose facility with office, residential, and hotel component on Rubtsovskaya Embankment • AFI Development is at an advanced stage of planning on Pochtovaya Phase I ƒƒ

Full zoning and permits in place

ƒ Phases II and III have been added to Phase I plot to create a single plot of 4.9 hectares. ƒ The project will be delivered in stages and will comprise almost 250,000 sqm of GLA June 2008 12


Kossinskaya ƒ An integrated multi-purpose office and retail center in Eastern Moscow-the most undersupplied area of the city with easy access to MKAD, Vyhino metro and rail stations. ƒ 111,000 sqm Class B office building is complete and fit-out ƒ Establishing concept design for highest and best use of an additional 70,000 sqm of new development.

June 2008 13


New Initiatives Hotels AFI Development acquired of four hotel properties from Africa Israel Hotels Ltd: ƒƒ Plaza Plaza Spa, Spa, Kislovodsk: Kislovodsk: ƒƒ

Operational Operational –– four-star four-star hotel hotel with with 274 274 bedrooms bedrooms

ƒƒ Park Park Plaza, Plaza, Kislovodsk: Kislovodsk: ƒƒ

Land Land plot plot over over 55 hectares; hectares; ground ground works works underway, underway, development development of of this this 500-bedroom 500-bedroom hotel hotel isis expected expected to to complete complete in in 2010 2010

ƒƒ Versailles, Versailles, Kislovodsk: Kislovodsk: ƒƒ

Project Project to to redevelop redevelop an an historic historic building building and and the the construction construction of of new new facilities, facilities, which which include include aa luxury luxury spa spa hotel hotel

ƒƒ Kalinina, Kalinina, Zheleznovodsk: Zheleznovodsk: ƒƒ

Project Project to to convert convert an an existing existing building building into into aa modern modern three-star three-star hotel hotel with with aa total total area area of of 11,500 11,500 sqm sqm (175 (175 bedrooms) bedrooms)

June 2008 14


Outlook ƒƒ Track Track record record and and expertise expertise of of management management continues continues to to provide provide AFI AFI Development Development with with aa competitive competitive advantage advantage ƒƒ Extremely Extremely strong strong portfolio portfolio and and pipeline pipeline with with massive massive potential potential ƒƒ Continued Continued strong strong market market conditions conditions (commercial (commercial and and residential) residential) underpinned underpinned by by growing growing interest interest from from international international investors investors and and potential potential tenants tenants –– for for example, example, at at Four Four Winds Winds ƒƒ Existing Existing projects projects progressing progressing with with some some completing completing early early –– AFI AFI Development Development continues continues to to create create significant, significant, landmark landmark schemes schemes ƒƒ Robust Robust strategy strategy continues continues to to produce produce results; results; broadening broadening geographic geographic focus focus to to include include Ukraine Ukraine and and the the CIS CIS ƒƒ In-house In-house ‘best ‘best in in class’ class’ construction construction management management and and development development expertise expertise –– demonstrated demonstrated by by continued continued progress progress on on planning planning and and zoning zoning permissions permissions June 2008 15


Appendix – AFI Group – Value Enhancing Parent Company

Africa Israel Investments Holding Company Ticker: AFIL (TASE)

Africa Israel Properties

Africa Israel Residential

Africa Israel Hotels

AFI USA

AFI Development

Danya Cebus

Yielding Properties

Housing in Israel

Crowne Plaza and Holiday Inn in Israel

Real Estate Development in USA

Real Estate Development in Russia

Construction & Infrastructure

AFRP (TASE)

AFRE (TASE)

AFID (LSE)

DNYA (TASE)

Steel Trade Ceramics

Danya Cebus Rus

AFI Europe Real Estate Development in CEE

Related Industries & Other Activities

SPA Hotels in Kislovodsk

Construction in Russia

June 2008 16


Appendix –– Project Case Studies AFI Development successfully executed 8 projects between 2003 – 2006, achieving substantial returns (1) Patriarshy Ponds(1)

ƒ Primary Asset Type: Residential (24,235 sqm)

Nejinskaya

(1) Palaty Muravievikh(1)

ƒ Primary Asset Type: Residential (8,490 sqm)

Aquamarine I

House of Lions(1)

ƒ Primary Asset Type: Residential (4,100 sqm)

Udaltsova

Kislovodsk(1)

ƒ Primary Asset Type: Hotel (25,998 sqm)

Ozerkovskaya Emb.(2)

ƒ Primary Asset Type: Residential (170,791 (170,791 sqm) sqm)

ƒ Primary Asset Type: Office (13,558 sqm)

ƒ Primary Asset Type: Residential (33,461 sqm)

ƒ Primary Asset Type: MixedMixed-Use (117,589 sqm)

ƒ Year Sold: 2003; 100% sold

ƒ Year Sold: 2005; 100% Share sold

ƒ Year Sold: 2006; 100% sold

ƒ Year Sold: 2006; 50% Share sold

ƒ Sale Price/ Price/ Gross Cost: 2.3x

ƒ Sale Price/ Gross Cost: 2.4x

ƒ Sale Price/ Gross Cost: 1.9x

ƒ Sale Price/ Gross Cost: 3.9x

June 2008

Notes 1. AFI Development acted as development project manager, but did not own the asset 2. 50% of Phase II and III excluding hotels

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