Moscow, Russia -  September 24, 2007 - Sistema-Hals (LSE: HALS), one of the largest diversified companies on the real estate market in Russia and the CIS, announced the signing of a three-party agreement between the Astrakhan region, City of Astrakhan and OJSC Sistema-Hals on the implementation of the "New City Center" project in Astrakhan costing approximately USD 2 500 million.

"New City Center" will consist of a multipurpose complex in the historical center of Astrakhan on a 200-hectare site, including residential and office buildings, retail and leisure and hotel facilities.

The overall construction site is around 2.8 million square meters, of which 1.5 - 1.8 million square meters will be designated for residential buildings. The new district will preserve the historical and public profile of the city center.

"The regional expansion and entry on rapidly growing markets is part of the business strategy of Sistema-Hals. We see the major potential in the economic development of the city Astrakhan. The expertise of Sistema-Hals in the field of complex town-planning solutions will contribute to the effective implementation of the current project," said Sistema-Hals Vice President Igor Kasheyev.