(LONDON, 04 June 2008) - PIK Group (LSE: PIK), one of Russia’s leading residential real estate developers, today announced that it is in advanced discussions regarding the acquisition of a major land plot in the historic heart of the city of St. Petersburg.

Situated approximately 630km north of Moscow on the Neva River, St. Petersburg has a population of approximately 4,695,000 (source: 2000 census) and is Russia’s second largest urban centre after the capital.

While PIK will continue to focus on the mass market, the Group sees interesting opportunities in Moscow and St. Petersburg for selected developments in higher-end segments of the residential real estate market. PIK is already developing two high-end business class residential complexes in Moscow - the “English Town” and “Park City”.

The Group intends to develop a flagship project in St. Petersburg aimed at a similar segment of the market. Located in an exclusive area, it will be developed over the next ten years and when completed will offer approximately 1.3 million square meters of housing.

As of January 1 2008, the Group’s property portfolio amounted to 14.2 million square meters of unsold net sellable space, which was valued at US$12.3 billion by CB Richard Ellis, the independent appraiser. Since that date, the total land bank of the company is already up by approximately 16% accounting for the above land acquisition.

Commenting on today’s announcement, Kirill Pisarev, CEO of PIK said:

“St. Petersburg has the right profile for PIK – it is at the heart of a region attracting high levels of investment and has the right socioeconomic trends. The city has a strong intellectual and scientific heritage and there is demand from its growing middle classes for better housing. Our intention is to address this need in the first instance through this flagship development and, looking further ahead, by acquiring further new sites and expanding our activities in the region.”