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10 February 2009

EUROPEAN CONVERGENCE PROPERTY COMPANY PLC (THE 'COMPANY' OR 'ECPC')

Property Revaluation and NAV

The Board of ECPC announces the results of an independent revaluation of the Company's remaining investment property, Mall Veliko Turnovo ('MVT') in Bulgaria.

The Board obtained two opinions from independent experts, being valuations by SHM Smith Hodgkinson ('SHM') and Jones Lang LaSalle ('JLL'). 

SHM is a British firm of Chartered Surveyors established in 1860 and specialising in property and corporate asset consulting and valuation services. In 2004, SHM was acquired by the Gordon Brothers Group of USA. GB Group has approximately 300 employees worldwide including SHM offices in London, Manchester, Leeds, Bucharest, Belgrade and Kyiv. The firm's Bucharest office leads its services across the SEE region and in 2008 completed valuations for assets totalling approximately €4 billion.

JLL is one of the world's leading real estate services and investment management firms, employing 30,000 people and having a presence in 700 cities in 60 countries worldwide. The firm has been active across the SEE markets since the mid 1990s, which activities have been led from its Bucharest office since early 2007.

Taking into account the change in global economic and credit market conditions both firms have assumed an exit yield which has increased when compared to similar benchmarks prevailing during H1 2008. Both firms have also agreed with the forecast taken for the management of the asset's rent-roll through the expected difficult retail market conditions of 2009. 

SHM valued the property at €28.0m. JLL separately and independently valued the property at €27.9m. The Board was reassured by the similarity between the two valuations, taking into account the difficulty in assessing the value of investment property in the prevailing market conditions.

For reasons of prudence the Directors have chosen to adopt the lower valuation, which shows a decrease in the market value of MVT of €3.7m, reducing the value from €31.6m at the previous valuation on 30 September 2008 to €27.9m at 31 December 2008. The decrease reflects the impact on the retail property investment market in Bulgaria resulting from the current global credit restrictions and economic conditions.

The valuation of the asset is analysed below.

€m	Equity Investment	External Borrowings	Total Acquisition Cost*	Valuation As at 30 Sept 2008	Revaluation As at  31 Dec 2008	Decrease from previous valuation	%
Mall Veliko Turnovo	10.6	19.2	29.8	31.6	27.9	(3.7)	(11.7)

* including transaction costs

The result of this revaluation on the net assets per share of the Company, excluding other factors, will be a reduction of 0.06 Euro from the published NAV as at 30 June 2008, which would result in a NAV per share of €0.195. It should be noted that this calculation is for illustrative purposes only and may differ from the actual current NAV. 

The Company's interim results to 31 December 2008, which will be announced in March, will reflect this valuation and will include an updated and unaudited NAV per share.

The valuation of the Company's remaining property asset is based on a number of estimates and assumptions concerning future events which may or may not prove correct.

In Bulgaria, as worldwide, the outlook for the economic environment and local credit markets remains uncertain. Given the importance of debt to the valuation of property assets, changes in the debt market over the coming months may have material effects on the Company's valuation.

For further information please contact:

Charlemagne Capital	+44 (0)207 518 2100
Varda Lotan / Christopher Fitzwilliam Lay
Galileo Fund Services Limited	+44 (0)1624 692600
Ian Dungate, Company Secretary
Panmure Gordon (UK) Limited	+44 (0)20 7459 3600
Hugh Morgan
Stuart Gledhill
Smithfield Consultants	+44 (0)20 7360 4900
John Kiely
Gemma Froggatt

www.europeanconvergence.com

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