Second Quarter Results for the six months ended 30 June 2007

Released: 16/08/2007

Eurocastle Investment Limited owns and invests primarily in German commercial property. The Group is Euro denominated and currently listed on Euronext Amsterdam, under the symbol "ECT" and on the Frankfurt Stock Exchange, under the symbol "EUI1". Eurocastle’s objective is to build long-term value for its shareholders and to pay out stable and growing dividends. Eurocastle is managed by an affiliate of Fortress Investment Group LLC. For more information regarding Eurocastle and to be added to our email distribution list, please visit www.eurocastleinv.com.

Half Year Highlights

• Dividend declared for the second quarter 2007 is €0.60 per share. This compares to the second quarter 2006 dividend of €0.40 per share and first quarter 2007 dividend of €0.45 per share.
• Completed €2.2 billion of commercial property purchases, including the acquisition of 56 German commercial property assets ("the Mars portfolio") announced in December 2006 and completed in first quarter 2007.
• Signed 365 leases for approximately 143,000 square meters, including 140 new leases for approximately 40,000 square meters.
• Completed the sale of 72 of the 78 non-core assets held for sale at 31 March 2007, at a 9% premium to the 2006 year end carrying value, resulting in a realised gain on the book cost, net of associated sale costs and taxes, of €26.5 million or €0.42 per share.
• Admitted to trading on the Frankfurt Stock Exchange on 20 June 2007.
• Increase in the fair value of investment properties of €280.4 million for the six months to 30 June 2007 of which €239.1 million was achieved in the second quarter.
• Entered into exclusive negotiations to acquire 68 retail properties for an aggregate all-in purchase price of approximately €210 million.

Key Performance Indicators

• Net profit after tax of €236.2 million for the second quarter 2007, increased from €13.7 million for the second quarter 2006.
• Earnings per ordinary share of €3.70 or €3.58 per diluted share, for the second quarter 2007 compared to €0.30 per ordinary share or €0.29 per diluted share, for the second quarter 2006.
• Funds From Operations ("FFO", see Key Financial Information) increased by 218% to €57.2 million for the second quarter 2007 from €18.0 million for the second quarter 2006.
• FFO of €0.90 per ordinary share (30 June 2006: €0.40 per share) or €0.87 per diluted share (30 June 2006: €0.38 per share).
• FFO return on average invested capital* was 15.6% for the second quarter 2007.
• NAV per share increased to €29.07 at the end of the second quarter 2007 from €25.58 at the end of the first quarter 2007, an increase of 13.6%.

• Net profit after tax of €290.5 million for the first half 2007, compared to €106.6 million for the first half 2006.
• Earnings per ordinary share of €4.56 or €4.40 per diluted share, for the first half 2007, compared to €2.56 per ordinary share or €2.46 per diluted share for the first half 2006.
• FFO increased by 167% to €85.1 million for the first half 2007 from €31.9 million for the first half 2006.
• FFO of €1.34 per ordinary share or €1.29 per diluted share for the first half 2007 compared to FFO of €0.77 per ordinary share or €0.74 per diluted share for the first half 2006.
• FFO return on average invested capital* was 11.7% for the first half 2007.
• NAV per share increased to €29.07 at the end of the second quarter 2007 from €24.73 at the end of the fourth quarter 2006, an increase of 17.8%.

Conference Call

Management will conduct a conference call today, 16 August 2007, to review the Group's financial results for the quarter ended 30 June 2007. The conference call is scheduled for 3:00 P.M. London time (10:00 A.M. New York time). All interested parties are welcome to participate on the live call. You can access the conference call by dialing +1-800-811-8824 (from within the U.S.) or +1-913-981-4903 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference "Eurocastle Second 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 Thursday, 23 August 2007, by dialing +1-888-203-1112 (from within the U.S.) or +1-719-457-0820 (from outside of the U.S.); please reference access code "3684763".

View the full Second Quarter Results for the six months ended 30 June 2007 in PDF format (355 KB, opens in a new window).