Interim Results for the three months ended 31 March 2006

Released: 24/05/2006

Eurocastle Investment Limited is a closed-ended investment company which invests primarily in German commercial real estate assets. The Company is Euro denominated and is listed on Euronext Amsterdam under the symbol “ECT”. Eurocastle’s objective is to pay out stable and growing dividends and to deliver attractive risk-adjusted returns. Eurocastle is managed by Fortress Investment Group LLC. For more information regarding Eurocastle and to be added to our email distribution list, please visit www.eurocastleinv.com.

First Quarter Highlights

• Increased real estate investment portfolio to €2.8 billion
  • Completed the acquisition of a €2 billion German property portfolio from Dresdner Bank in February 2006, via the acquisition of Dresdner Grund-Fonds
  • Continued acquisition program, completing 21 new retail property acquisitions for a purchase price of €54.7 million, and a yield of approximately 7.1%
• Committed to purchase or entered into exclusive negotiations to purchase an additional €250 million of real estate assets at an approximate average 6.75% yield
• Raised net proceeds of €524 million of new equity capital, helping to more than triple equity book value from year end 2005 to €928.7 million, or an increase of 65% to €20.37 on a per share basis
• Increase in net asset value includes revaluation gains of €77.9 million, based on an independent valuation of the Dresdner Bank portfolio, which are included in operating income for the quarter
• Continued lease-up of Deutsche Bank portfolio to current occupancy rate of approximately 77% at quarter end, up from 74.6% at 2005 year end

Key Performance Indicators

• Net profit after tax of €92.9million for the first quarter 2006, increased from €6.5million for the first quarter 2005
• Earnings per ordinary share of €2.47, or €2.37 per diluted share, for the first quarter 2006 compared to €0.35 per share, or €0.34 per diluted share, for the first quarter 2005
• Funds from operations ("FFO", see Key Financial Information) increased by 44% to €13.9 million for the first quarter 2006 from €9.6 million for the fourth quarter 2005
• FFO of €0.35 per weighted average diluted share (39.2 million shares), or €0.30 per ordinary share outstanding at quarter end (45.6 million shares)
• FFO return on average invested capital was 8.9%
• Dividends declared for the period was 30 cents per share on 45.6 million shares outstanding
• Number of shares outstanding increased by 21.4 million shares to 45.6 million shares in the first quarter 2006

Conference Call

Management will conduct a conference call today, 24 May 2006 to review the Company's financial results for the first quarter ended 31 March 2006. The conference call is scheduled for 4 P.M. London time (11 A.M. New York time). All interested parties are welcome to participate on the live call. You can access the conference call by dialing +1-866-323-3742 (from within the U.S.) or +1-706-643-0550 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference “Eurocastle First Quarter Earnings Call.”

A webcast of the conference call will be available to the public on a listen-only basis at www.eurocastleinv.com. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast. A replay of the webcast will be available for three months following the call.

For those who are not available to listen to the live call, a replay will be available until 11:59 P.M. New York time on Wednesday, 31 May 2006 by dialing +1-800-642-1687 (from within the U.S.) or +1-706-645-9291 (from outside of the U.S.); please reference access code “9019196.”