On the 1st of March, 2005 Knight Frank LLC held a press-conference devoted to the presentation of its first Regional Overview of Commercial Real Estate.

29 March 2005

Press Release

On the 1st of March, 2005 Knight Frank LLC held a press-conference devoted to the presentation of its first Regional Overview of Commercial Real Estate.

The Overview became the first attempt to sum up and systematize scarce information about real estate markets of 10 large Russian cities such as Saint Petersburg, Ekaterinburg, Nizhny Novgorod, Novosibirsk, Omsk, Perm, Rostov-on-Don, Samara, Ufa, and Chelyabinsk. The selection process considered both economic activities of the chosen cities and the sphere of Knight Frank's interests. The given research is the first step in laborious work that Knight Frank LLC will continue for further investigation.

The comparative analysis of the regional markets was undertaken because of the following reasons.
First, the development strategy of Knight Frank requires active participation in regional projects. It can be explained by the overall interest of leading players in regional markets. Secondly, we wanted to introduce to the market an effective and highly demanded product that could be used for both better understanding of the present market situation in the regions and for the opening of participation among real estate companies on the federal scale. We believe the Overview will be valuable for those companies, which are considering entering regional markets.

Andrew Rybalko, Head of Research Department at Knight Frank LLC, commented:

- At present, the professional community of companies working in real estate lacks the necessary information about regional real estate markets. Hence, the team of Knight Frank specialists decided to come up with the analytical product that would include information on the most perspective regional markets. Both the gathering of information on every city and its further analysis took about 6 months. It allowed us to get general market overviews and identify the main trends and peculiarities of each region. In the near future, Knight Frank will proceed with detailed field research, which is aimed at receiving complete data that will allow us to come up with a deeper analysis.
The final stage of the project will embrace concrete conceptual decisions based on forecast scenarios of local markets' development. The Overview will become one of the fundamental instruments to be used for consulting services and definitely the absolute advantage for Knight Frank.

The Regional Overview of Commercial Real Estate is the first informative product that can be effectively used for analyzing the needs of different regions for all related projects. Despite the fact that the lion's share of all investments goes to the retail sector, the involvement of the leading real estate players in projects of other sectors is quite likely.

Natasha Reteyum, Development Director at Knight Frank LLC, stated:

- The development of local markets is directly related to the economic showing and potential of a particular region. The retail sector continues to be the most attractive for both local and international retail corporations. Other segments of commercial property are not so well developed; however, there are the grounds to believe that a number of competent and highly demanded projects are coming in the near future. We believe that development of the retail sector will cause the construction of modern warehouse complexes. Residential real estate development is also of no small importance.