Eurocastle Investment Limited / Financial results for the year ended 31 December 2008

Guernsey (ots) - Eurocastle Investment Limited (Frankfurt Stock
Exchange: EUI1 and Euronext Amsterdam: ECT) today announced its
financial results for the year ended 31 December 2008. For more
information regarding Eurocastle, its 2008 Annual Report and to be
added to our email distribution list, please visit
www.eurocastleinv.com .

Further details of Eurocastle's liquidity and its capital raising
considerations are included in its 2008 Annual Report.

Highlights

Financial

- FFO* was E57.1 million or E0.91 per share for the year ended 31
December 2008 compared with E186.3 million or E2.92 per share
for the year ended 31 December 2007.

- NAV per share of E13.35 as at 31 December 2008 comprising of
(E0.27) for the debt investment business and E13.62 for the
commercial property portfolio (31 December 2007: E23.05
comprising E2.11 for the debt investment business and E20.94
for the commercial property portfolio).

- Net loss after tax was E454.1 million for the year ended 31
December 2008, compared with a profit of E134.9 million for the
year ended 31 December 2007. The losses primarily relate to non-
cash valuation adjustments to our portfolio.

Business Review

- Sold 15 properties during the year, for total sales proceeds of
E461 million, recognising a gain on book cost, net of all
transaction costs of E4.7 million.

- During the year the Group signed 658 commercial leases for
approximately 310,000 square metres, including new leases for
approximately 102,000 square metres.

- Lettable space of 2.1 million square metres with occupancy of
85.8% as at 31 December 2008, compared to 84.3% last year on a
same store basis.

Financing and Liquidity

- In 2008, the Group repaid, extended, or refinanced over E1.3
billion of debt.

- Since year end, the Group has agreed to extend E236 million of
its short term loan due in June 2009, and agreed to an
extension of its maturing corporate loan of E125 million to
2011. These facilities have scheduled amortisation payments
prior to maturity.

- The Group expects to go to the markets to raise additional
capital in the near term to pay down its Corporate Loan
Facility. It already has a conditional undertaking from an
existing shareholder regarding E15.4 million of any such
capital raise.

* FFO (Funds from Operations) is a non-IFRS financial measure
used by our Group's management to report the funds generated
from operations for investment and the payment of dividends to
shareholders. Key Financial Information

INCOME STATEMENT DATA
| |Year ended |Year ended |
|( in E'000, except per share |31 December 2008|31 December |
|data) | |2007 |
|Interest income |155,382 |144,697 |
|Rental income |281,118 |303,744 |
|Service charge income |55,790 |60,878 |
|Real estate fund unit interest|- |17,185 |
|income | | |
|(Decrease) / increase in fair |(499,151) |35,004 |
|value of investment properties| | |
|Increase in fair value of real|- |16,751 |
|estate fund units | | |
|Other than temporary |(16,794) |- |
|impairment on securities | | |
|Interest expense |(285,596) |(281,414) |
|Service charge and Property |(90,239) |(83,351) |
|operating expenses | | |
|Other operating expenses |(47,641) |(67,878) |
|Net (loss) / profit before |(467,916) |155,787 |
|taxation | | |
|Net (loss) / profit after |(454,073) |134,915 |
|taxation | | |
|Funds from operations ("FFO") |57,087 |186,286 |
|(Loss) / earnings per weighted|(7.20) |2.12 |
|average basic share | | |
|(Loss) / earnings per weighted|(7.20) |2.06 |
|average diluted share | | |

| |Year ended |Year ended |
| |31 December 2008|31 December |
| | |2007 |
|Weighted average ordinary shares | |
|outstanding | |
|Basic |63,072,337 |63,787,016 |
|Diluted |63,072,337 |65,569,559 |
| | | |
|Ordinary shares |60,731,646 |63,927,634 |
|outstanding | | |

BALANCE SHEET DATA

|(in E'000, except per share |31 December |31 December |
|data) |2008 |2007 |
|Cash and cash equivalents |119,869 |146,707 |
|Investment property |4,230,111 |5,171,086 |
|(including properties held | | |
|for sale) | | |
|Debt investments |1,733,942 |2,059,753 |
|Other assets |164,387 |130,649 |
|Total assets |6,248,309 |7,508,195 |
|Interest bearing debt |(5,300,880) |(5,859,058) |
|financing | | |
|Other liabilities |(136,377) |(175,443) |
|Total liabilities |(5,437,257) |(6,034,501) |
| | | |
|Net assets |811,052 |1,473,694 |
|Net asset value per ordinary|13.35 |23.05 |
|share | | |
| | | |
|Net assets - commercial |827,272 |1,338,673 |
|property portfolio | | |
|Net asset value per ordinary|13.62 |20.94 |
|share - commercial property | | |
|portfolio | | |
| | | |
|Net assets - debt investment|(16,220) |135,021 |
|business | | |
|Net asset value per ordinary|(0.27) |2.11 |
|share - debt investment | | |
|business | | |

|FFO Reconciliation |Year ended |Year ended |
| |31 December |31 December |
|( in E'000, except per share data) |2008 |2007 |
| |(Unaudited) |(Unaudited) |
|Reconciliation of FFO to net profit| | |
|after taxation | | |
|Net (loss) / profit after taxation |(454,073) |134,915 |
|Decrease / (increase) in fair value|499,151 |(35,004) |
|of investment properties | | |
|Decrease / (increase) in fair value|19,015 |(13,262) |
|of interest rate swaps | | |
|Unrealised movements on currency |595 |507 |
|swaps (net of translation (gains) /| | |
|losses on related assets) | | |
|(Increase) in fair value of real |- |(16,751) |
|estate fund units | | |
|Realised gain on sale of investment|5,872 |96,500 |
|properties | | |
|Deferred tax (benefit) / charge on |(13,473) |19,381 |
|investment properties | | |
|Funds from operations (FFO) |57,087 |186,286 |
|FFO per weighted average basic |0.91 |2.92 |
|share | | |
|FFO per weighted average diluted |0.91 |2.84 |
|share | | |

The table below shows the summarised financial data of the Group's
business segments with the unallocated amounts per between the
segments on the basis disclosed below the table.

|Income statement data |Debt |Investment|Total |
|Year ended 31 December 2008 |investment|properties|Eurocastl|
| |s | |e |
|(Unaudited) |E'000 |E'000 |E'000 |
|Revenue1 |150,019 |342,271 |492,290 |
|Other operating losses |(269) |(518,166) |(518,435)|
|Impairment losses |(14,476) |(2,318) |(16,794) |
|Interest expense |(115,560) |(170,036) |(285,596)|
|Service charge and property |- |(90,239) |(90,239) |
|operating expenses | | | |
|Other operating expenses |(7,645) |(41,497) |(49,142) |
|(including foreign currency | | | |
|gains/(losses)2 | | | |
|Operating profit/(loss) before |12,069 |(479,985) |(467,916)|
|taxation | | | |
| | | | |
|Taxation credit/(expense) |- |13,843 |13,843 |
| | | | |
|Net profit/(loss) |12,069 |(466,142) |(454,073)|
| | | | |
|Decrease / (increase) in fair |595 |518,166 |518,761 |
|values | | | |
|Realised gains on sale |- |5,872 |5,872 |
|Deferred tax |- |(13,473) |(13,473) |
|Funds from operations |12,664 |44,423 |57,087 |
| | | | |
|Funds from operations per |0.20 |0.71 |0.91 |
|ordinary share3 E | | | |
| | | | |
|Funds from operations (excluding |27,409 |40,640 |68,049 |
|gains, sales costs and impairment| | | |
|losses) | | | |
| | | | |
|Funds from operations (excluding |0.44 |0.64 |1.08 |
|gains, sales costs and impairment| | | |
|losses) per ordinary share E | | | |

1
Unallocated revenue of E1.3 million has been allocated between the
segments based on each segment's share of invested equity. Amounts
allocated were; debt investments: E0.2 million and investment
properties: E1.1 million.

2
Unallocated other operating expenses of E27.7 million have been
allocated between the segments based on each segment's share of
invested equity. Amounts allocated were; debt investments: E4.5
million and investment properties: E23.2 million.

3
Earnings per share and FFO per share are calculated on the
weighted average number of shares at 31 December 2008.

Conference Call

Management will conduct a conference call today, 30 April 2009, to
review the Group's financial results for the year and quarter ended
31 December 2008. The conference call is scheduled for 1:00 P.M.
London time (08:00 A.M. New York time). All interested parties are
welcome to participate on the live call. You can access the
conference call by dialling +1-877-717-3044 (from within the U.S.) or
+1-706-679-1521 (from outside of the U.S.) ten minutes prior to the
scheduled start of the call; please reference "Eurocastle Year End
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,
7 May by dialling +1-800-642-1687 (from within the U.S.) or
+1-706-645- 9291 (from outside of the U.S.); please reference access
code "96515191."

The Annual Report for 2008 of Eurocastle is available on
www.eurocastleinv.com .

Forward-Looking Statements

This release contains statements that constitute forward-looking
statements. Such forward-looking statements relate to, among other
things, future commitments to acquire real estate and achievement of
acquisition targets, availability of attractive investment
opportunities, methods of funding portfolios, timing of completion of
acquisitions, the operating performance of our investments and
financing needs. Forward-looking statements are generally
identifiable by use of forward-looking terminology such as "may",
"will", "should", "potential", "intend", "expect", "endeavour",
"seek", "anticipate", "estimate", "overestimate", "underestimate",
"believe", "could", "project", "predict", "continue", "plan",
"forecast" or other similar words or expressions. Forward-looking
statements are based on certain assumptions, discuss future
expectations, describe future plans and strategies, contain
projections of results of operations or of financial condition or
state other forward-looking information. Our ability to predict
results or the actual effect of future plans or strategies is
limited. Although we believe that the expectations reflected in such
forward-looking statements are based on reasonable assumptions, our
actual results and performance may differ materially from those set
forth in the forward-looking statements. These forward-looking
statements are subject to risks, uncertainties and other factors that
may cause our actual results in future periods to differ materially
from forecasted results or stated expectations, including the risk
that leasing markets will continue to be strong or that Eurocastle
will be able to achieve its targets regarding asset disposals,
operational growth particularly any increase in leasing of vacant
space on acceptable terms or take advantage of widening credit
spreads to acquire good quality collateral at discounted prices.

Disclaimer NOTHING IN THIS PRESS RELEASE IS INTENDED AS AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES IN THE
UNITED STATES. SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITES
STATES ABSENT REGISTRATION UNDER THE US SECURITIES LAWS OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH LAWS. AN
INVESTMENT IN EUROCASTLE INVESTMENT LIMITED (THE "COMPANY") CARRIES
CERTAIN RISKS AND PAST PERFORMANCE CANNOT BE RELIED ON AS A GUIDE TO
FUTURE PERFORMANCE.

Originaltext: Eurocastle Investment Limited
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Contact:
Mark Woodall
IAG as administrator for Eurocastle Investment Limited
Regency Court
Glategny Esplanade
St Peter Port Guernsey, GY1 1WW
Telephone: (44) 1481 737 911