Fusion Antibody Regulatory News (FAB)

28 Apr 2008 07:00

Fabian Romania Limited28 April 2008 28 April 2008 Fabian Romania Limited (FAB.LN) Net asset value as at 31 March 2008 Highlights • Fabian Romania Limited (the "Company"), is an AIM listed, experienced and leading investor in the Bucharest and wider Romanian real estate market. • The Company seeks to generate attractive total returns for its shareholders through a portfolio of income producing buildings, co-development residential, office, logistics and retail projects, with experienced partners and land investments. Fabian receives investment advice from Fabian Capital Limited, an independent investment management firm that specialises in Romanian real estate investment advice (Fabian Capital Limited does not carry out any regulated activities in the UK). • As at 31 March 2008, the Net Asset Value ("NAV") per share of the Company as determined in accordance with its Articles of Association was €1.703 (31 December 2007: €1.700) an increase of 0.2 per cent. over the fourth quarter of 2007 and 22.5 per cent. for the comparative full year (31 March 2007: €1.390). • Adjusting the current NAV for the estimated future development profits of €0.522 per share indicates a potential future NAV ("Development Profit NAV" or "DPNAV") of €2.225 per share (31 December 2007: €2.214) an increase of 0.5 per cent. over the fourth quarter of 2007. • As at 31 March 2007, the company has now invested or committed €37.5 million, or 98 per cent. of the €38.1 million in net proceeds raised at the time of AIM listing in December 2006. • Timisoara, the 50 per cent. joint venture residential project, acquired in the second quarter of 2007 to develop 350 apartments with local developer Coltex, has now attained upgraded planning consent for 38,524 square metres, an increase of 3,524 square metres from the expected 35,000 square metres at acquisition. The building permit application is expected to be submitted to the authorities in the current quarter with construction commencing during this year. • On 7 March 2008, the Company completed the acquisition of the Romana office development project. The Romana office building plot is located in the centre of Bucharest on Dacia Boulevard close to Romana Square. The building will be built to Class A specifications with a gross area of approximately 3,000 square metres while the net lettable office area will be circa 2,480 square metres over 7 floors, together with 40 car parking spaces. Construction is due to commence in second quarter of this year with practical completion anticipated in the second quarter of 2010. • The office rental market is continuing to develop strongly. Approximately 90 per cent. of Lakeview, the office joint venture development with AIG/ Lincoln has now been either pre-let or is at advanced stages of negotiation. Finalisation of the main construction contract is underway with construction expected to commence next quarter. Pre-construction works have been underway since the fourth quarter of 2007. • The New Town residential scheme continues to experience forward sales of its residential units. Sales commenced in July 2007 and to date 270 apartments have now been reserved off plan comprising 85 per cent. of the three sales releases totalling 316 apartments. • The construction works for Cubic Centre office building are ahead of schedule with anticipated practical completion in the first quarter of 2009. To the shareholders of Fabian Romania Limited Fabian Romania Limited, is pleased to announce that its NAV as at 31 March 2008is €1.703 per share. This represents a rise of 0.2 per cent. from the precedingfourth quarter NAV of €1.700 per share. Year on year, the NAV of the company hasrisen 22.5 per cent. from €1.390 per share as at 31 March 2007. The published NAV was calculated according to the Company's Articles ofAssociation and the results are summarised below: As at 31 March 2008 Fabians' share Bank (debt) Net Worth Net Equity of Market Value invested ** •m •m •m •mCascades 18.5 (9.2) 9.3 2.6Banu 17.7 (8.8) 8.9 3.4New Town * (^) 23.9 (9.4) 14.5 5.8Lakeview *(^) 11.9 (5.6) 6.3 5.3Cubic Centre 12.5 0.0 12.5 12.5Baneasa Business Centre 29.0 (19.4) 9.6 4.2Timisoara * (^) 4.8 (2.6) 2.2 1.6Evo 6.1 (3.7) 2.4 1.5Romana 3.0 (0.8) 2.2 1.3Net cash 15.8Other assets / (liabilities) 2.7Sub-total 127.4 (59.4) 86.5 38.2Shares (#) 50,831,130NAVPS (•) 1.703Growth in Q1 2008 0.2%* represents Fabian Romania Limited's share of the development(^) includes development WIP financed by both equity and bank debt ** Net equity invested comprises the original acquisition equity lessamounts repaid through refinancing Future Development Profit of €0.522 per share Under the Red Book methodology of the Royal Institution of Chartered Surveyors,residual land valuations for development projects provided to Companies such asFabian Romania Limited exclude the net present value of future developmentprofits. The Directors believe this approach, whilst logical for valuing landplots between buyers and sellers, is not ideal for shareholders in quotedproperty companies where development is a key component of the company'sactivities. In order to provide transparency to our shareholders as to thepotential level of such future development profits that may accrue to theCompany, DTZ Echinox ("DTZ") is asked to provide estimates of these developmentprofits. These estimates by their very nature are forecasts relying on futureevents and accordingly are subject to uncertainty. Shareholders may then chooseto discount these profits to estimate their net present value in today's termsbased on current market conditions. The forecast development profit figures are stated gross and do not include allcosts that may be incurred by Fabian over the course of the projects (inparticular transaction fees and any carried interest payable to the investmentmanager). The implied share of future development profit figures for the NewTown and Timisoara residential schemes and the Lakeview, Cubic Centre and RomanaOffice schemes, based on the Company's calculations using DTZ's estimates, ishighlighted in the table below: Project Implied Fabian Share of future Development Profit Final Year of (•m) Development *Cubic Centre 4.4 2009New Town 8.1 2009Lakeview 8.9 2009Romana 0.4 2010Timisoara 4.8 2010NAV contribution (•m) 26.6 NAVPS contribution (•) 0.522 * Fabian Romania Limited estimates Adding these forecast development profits of €26.6 million or €0.522 per shareto the NAV produces what the Directors have called the DPNAV of €2.225 pershare. This represents a rise of 0.5 per cent. over the 31 December 2007 DPNAVof €2.214. Portfolio Mix As at 31 March 2008, the portfolio of the Company comprised the following typeof investments as a percentage of the net asset value of the Company. Portfolio mix(as at 31 March 2008) Net worth Income 35%Development 44%Cash and other 21% 100% AIM proceeds 98 per cent. invested or committed As at 31 March 2008, the company has now invested or committed €37.5 million, or98 per cent. of the €38.1 million in net proceeds raised at the time of its AIMlisting in December 2006. The following sums have been either invested orcommitted for investment during the first quarter. This is in line with theCompany's prudent policy of always ensuring it has the equity available to buildout a development project when an acquisition is made. • million Cash balance, at 31 December 2007 23.90 Funds retained in existing joint venture development companies (2.06)Lakeview, equity reinvestment prior to construction (2.34)Romana, future equity requirement (1.88)New Town, potential future funding requirement (2.75)Timisoara, future equity requirement (6.06)New acquisitions currently undergoing due diligence, future equity requirement (4.18)Jersey level contingency(4.00) (4.00) Total free cash available for investment 0.63 Total net funds raised at IPO in December 2006 38.10Total invested since December 2006 98% Percentage of amounts still to be invested 2% Timisoara new planning achieved The new planning application ("PUZ") lodged with the city planning authoritiesin the fourth quarter of 2007 for the Timisoara land plot was approved in thefirst quarter of 2008. This grants permission for 38,524 square metres ofresidential space over ground on a plot of 13,245 square metres. This representsan increase of 3,524 square metres over the previous planning permissionobtained. It is expected that the building permit application will be submitted to thelocal authorities in the second quarter of 2008. Construction work is planned tocommence on site in the fourth quarter of this year. A firm of UK architects isworking together with local architects to develop the concept design. To date,the investment manager has been extremely impressed with the quality of thedesign ideas produced by the architects engaged. The total purchase price for all the plots purchased between June and October2007 amounted to €6.54 million representing a price of €494 per square metres ofland or €187 per square metre built above ground. Timisoara is one of therichest cities in Romania, close to the Hungarian boarder with a strong localeconomy and low unemployment. The city is the centre for many internationalcompanies entering Romania preferring a base in the west of the country towardsHungary and the rest of the European Union. The land value for the company's 50 per cent. share in the Timisoara schemegiven by DTZ at 31 March 2008 was €4.05 million, up 9 per cent. from the 31December 2007 valuation of €3.7 million or 24 per cent since acquisition. Addingwork in progress of €0.75 million, the total value of the Company's investmentstands at €4.8 million. This has been financed by €1.6 million of equity, and aproportionate share of bank debt drawn down from Banca Romanesca of €2.6million, resulting in a small gain to date of €0.6 million on the Company's netinvested equity. The Company currently forecasts project completion to beachieved by the end of 2010. Romana acquisition On 7 March 2008, the Company completed the acquisition of the Romana officeproject. The Romana office building will be built for Fabian on a centrallylocated site on Dacia Boulevard. The building will be built to Class Aspecifications with a gross area of approximately 3,000 square metres. Theproject management will be undertaken by Globus, an experienced local developerin Romania. Construction is due to commence in the second quarter of 2008 withcompletion anticipated in the second quarter of 2010. Upon completion, thebuilding will provide a net lettable office area of around 2,480 square metresover 7 floors, together with 40 car parking spaces. The building is in aprominent position with views over Romana Square and is likely to attractinternational tenants seeking Class A office space. The Company will pay a totalpurchase price of €9 million of which €1.3 million has already been paid.Financing for the project has credit approval by the Bank of Cyprus. Upon debtdraw down, the Company's equity requirement is expected to be €1.9 million withdebt finance to fund the balance. The acquisition gives the company further exposure to both a city centrelocation and the office rental market. On base case rents of €22 per squaremetre per month, the implied acquisition yield amounts to 9.4 per cent., up fromthe 8.9 per cent. assumed when the acquisition was first signed in February lastyear. The continued strength of the Bucharest office market should underpin ourcurrent rental assumptions, with achieved rents in the area currently exceeding€22 per square metre per month. Lakeview building now 90 per cent. pre-let or subject to heads of terms At the time of writing, 67 per cent. of the building is pre-let to two tenantswith a further 23 per cent. subject to heads of terms with a further tenant, allof whom are substantial multi-national corporations. The rentals achieved are inline or just above the investment manager's expectations for a pre-let buildingin this location. Since September 2007, when final building consent was granted for theconstruction, extensive work has been undertaken by our development partner, AIG/Lincoln, to prepare the site for the start of construction by next quarter. Thenegotiation of the construction agreement is in its final stages following atendering process with local and international contractors. In line with the Company's policy, valuations take place at the half and fullyear stages, unless material changes have taken place during the quarter. Thevaluation of the Lakeview site therefore remains unchanged from the 31 December2007 valuation of €8.8 million against the purchase price of €5.3 millionequating to a 66 per cent. return on equity. Adding work in progress of €3.1million to this valuation, the value of the company's investment stands at €11.9million. The development has been financed by €5.3 million of equity and bankdebt drawn down from a facility with MKB Bank of €5.6 million. The forecast gross development value of the scheme, according to DTZ, as at 31March 2008, also remains unchanged from the 31 December 2007 valuation of €71.8million. This is based on a core yield of 6.8 per cent. and forecast officerents of €15 per square metre per month. After deducting forecast developmentcosts, DTZ's forecast implies future development profits for the companyamounting to €8.9 million or some €0.18 per share. The Company currentlyforecasts project completion to be achieved by the end of 2009. Sales update at New Town New Town is a scheme of 72,000 square metres above ground involving theconstruction of 636 apartments targeted at Bucharest's emerging middle class.The scheme was granted final building consent at the start of April 2007. Thejoint venture development company, Phoenix Park SRL, in which the company has a50 per cent. stake has agreed a fixed price build contract with Mivan Kier. A full sales launch for New Town commenced in mid July 2007 with the first ofsix sales releases comprising 119 apartments. Two further releases have beenmade since then. The Directors are pleased to announce that as of the time ofwriting, 270 apartments in the New Town residential scheme have now been sold.All apartments in the first release, 117 out of 122 in the second release and 34out of 75 in the third release have been sold. The first release had an averageselling price of €1,299 per square metre, the second release had an averageselling price of €1,437 per square metre and the third release is currentlyselling at an average price of €1,586 per square metre (excluding VAT). The 31 December 2007 site valuation, by DTZ, of €15.6 million for the company's50 per cent. share in New Town remains unchanged. Adding work in progress of€13.0 million to this valuation, but subtracting advances from customers of €4.7million, the value of the company's investment stands at €23.9 million. This hasbeen financed by €5.8 million of equity and bank debt drawn down from HVB of€9.4 million. The resultant gain of €8.7 million equates to a 150 per cent.return on the company's invested equity. The Company currently forecasts projectcompletion to be achieved by the end of 2009. Income producing buildings: Cascades, Banu Antonache, Baneasa Business Centreand Evo Centre The Banu Antonache investment has remained constant at €17.7 million in linewith the DTZ valuation at 31 December 2007. On the invested equity of €3.4million, the return on the company's equity has grown to 162 per cent. sinceacquisition in December 2005. DTZ has valued Cascades at €18.51 million compared to the 31 December 2007valuation of €18.5 million. On the original equity investment in April 2006 of€2.6 million, post debt drawdown, the return on the company's equity invested inCascades since acquisition has now grown to 258 per cent.. Baneasa Business Centre has been valued by DTZ as of 31 March 2008 at €29.5million, unchanged from the valuation as at 31 December 2007. The directorshave included the building at a valuation of €29.0 million to reflect a morecautious approach in the current environment towards buildings that are notrecently built, given Baneasa was built in 2001. Since the acquisition of the Baneasa Business Centre on 29 June 2007, theinvestment manager has been able to renegotiate existing leases as they came upfor renewal and increased the average remaining unexpired lease length to 3.7years from 1.7 years. Further asset management initiatives are being consideredand the investment manager is confident the building will continue to grow invalue. Net equity invested by the Company is approximately €4.2 million prerevaluation. With a gain of €5.4 million since acquisition, the Company hasachieved a pro forma return on equity invested of 129 per cent. to date. The Evo Centre, comprising 3,213 square metres of lettable space, was valued at€6.1 million by DTZ on 31 March 2008 representing an uplift of €0.03 million or0.05 per cent. from the previous valuation of €6.07 on 31 December 2007. Thebuilding was acquired from its developers, the Adama Group of Israel on 22November 2007 for a purchase price of €5.2 million. In December 2007, theCompany drew down €3.7 million from Investkredit Bank AG resulting in net equitypost drawdown of €1.5 million. Since acquisition, the Company has made a gain of60 per cent. on the initial equity invested. Cubic Centre on budget but ahead of time schedule The construction of the Cubic Centre office building is expected to be completedin the first quarter of 2009, a quarter earlier than the original plans. Fabianhas paid an initial instalment of €12.5 million towards the anticipated purchaseprice which is expected to be the total equity requirement for the company. Atthe practical completion of the building, Fabian will pay the final instalmentbased upon a forward purchase yield of 7.4 per cent. to 7.8 per cent. applied tothe rents achieved by the developer. DTZ estimated the future value of the Cubic Centre at €64.8 million based on ayield of 7.15 per cent. as at 31 December 2007. After deducting the balance ofthe purchase price still to be paid by the company, the future developer'sprofit is estimated at €4.4 million to the Company or €0.09 per share. The Economy The Romanian economy continues to power ahead. GDP growth for 2007 came out at 6per cent. on top of 7.9 per cent. growth in 2006 and 4.1 per cent. in 2005. Theeconomy has now been continuously expanding at above 4 per cent. per annum sincethe end of 2000. This represents a remarkable turnaround from the performance inthe 1990s when two deep recessions took place in the space of ten years. Suchstrong GDP growth combined with an addressable market which, in populationterms, is the size of the Czech Republic and Hungary combined is drivingbusinesses' expansion plans. This is directly reflected in the demand theCompany, as a landlord, is seeing for office space. As an example, one of theCompany's prospective tenants is factoring in a 45 per cent. increase in theiroffice space requirements over the next five years. On the back of strong GDP growth, high employment and a benign tax environment,real wages grew by a staggering 21 per cent. in 2007. This comes on the back ofa 26 per cent. growth in 2006. This surge in real disposable incomes is having amarked impact on the consumer. Retail sales are strong which are in turn drivingretailers' demand for new retail space. In residential, the impact isparticularly marked with strong house price inflation to the benefit ofdevelopers. The flip side of such strong GDP growth and rise in net wages has been aconsumption boom. Along with the appreciation of the Lei against the Euro since2005, this has contributed to a ballooning trade deficit contributing in turn toconsensus forecasts for a 14 per cent. current account deficit in 2008. Onlyhalf of the deficit is expected to be covered by foreign direct investment, withthe balance from portfolio inflows. As a response the Central Bank has increasedinterest rates to slow both the growth of credit and the overall economy. Thecurrency has also depreciated against the Euro from the level of 3.11 againstthe Euro in May 2007 to 3.56 at the time of writing. Year to date, export growthhas now recovered to grow at a faster rate than the growth of imports but it istoo early to definitely predict the emergence of a positive trend. The absolutelevel of the current account deficit remains a concern. The Credit Crunch Impact The sub-prime lending crisis in the US has now started to have an impact onRomania. This is not because any of the fifteen or so of the mainly Austrian,Greek, Italian or German owned banks conducting property lending in the countryhave been particularly hit by exposure to sub prime mortgages per se, butbecause of the European wide reduction in money market liquidity and theassociated rise in Euro denominated interest rates. Banks have sought to pass ontheir increased costs of funding to borrowers. Financing is therefore stillavailable but at higher costs and with reduced loan to value ("LTV") ratios.According to Jones Lang LaSalle ("JLL"), investment loan margins have increasedon average by 40-65 bps and LTV ratios have declined to 65-75 per cent. from70-80 per cent. since the last half of 2007. Amortisation rates and debt servicecoverage ratios have remained unchanged. Owing to the investment manager'srelationship with a number of financial institutions, we believe securingfinancing for the company will not prove to be too onerous if the current marketconditions persist but it will be at the expense of higher interest rate marginsthan was the case last summer. In terms of an impact on demand in the country's property market, we havenoticed some caution from end buyers of residential apartments after a number ofnegative articles in the Romanian media concerning the credit crunch. There hasalso been some impact from the increase in Euro denominated mortgage rates,though given the current very low level of mortgage borrowing in the country,this effect should not be overstated. For the office market, office leasing activity remains high and unchanged fromlast summer. Vacancy rates remain sub 3 per cent. according to DTZ. In theabsence of substantial new supply, office rents jumped 20 per cent. in 2007according to JLL. Corporates continue to seek new office space for expansionand there has been no noticeable change to occupiers demand for pre-lets ofoffice space. In terms of investment purchases of office buildings, very fewtransactions have taken place since GTC's sale of America House to Ixis at a 5.6per cent. yield last August, albeit based on below market rents of €19.0 persquare metre per month. However, headline yields are suspected to have increasedto around 6 per cent. or just above. However, at this stage there have not beenany major transactions in the market to support this view. The Company has always been conservative in its approach to both financing anddevelopment risk and this is now paying dividends in the current morestraightened financial environment. For instance, finance liquidity risk hasalways been prudently managed by spreading the credit risk to not only differentfinancial institutions but with different and interpolating lengths of credits.The existing loan portfolio incorporates a mix of fixed and floating loans,which is being actively managed to limit an adverse impact on the Company from asudden deterioration in European interest rates. On the letting side, theCompany has always worked to secure pre-lets with strong tenants at an earlystage for all development projects. Construction procurement and costs aresecured by not relying on a single construction counterparty and by locking infixed construction contracts once building consent is achieved. By spreadinginvestments into different sub sectors of the country's property market, betweendevelopment projects and fully let investment properties and between Bucharestand the regions, the investment manager has continued to ensure that nounnecessary concentration exists in the spread of the Company's investmentportfolio. The Property Market Some concern has been expressed by some market participants as to the forecastlevel of supply in the office market over the next couple of years. A number ofBucharest based property agencies have forecast for 2007 - 2010 inclusive some300,000 square metres of new Class A office stock to be supplied into the marketin each year. Under such a scenario, and given the city's current total class Astock of just over 900,000 square metres, there is a risk that vacancy levelsmay increase from the current sub 3 per cent. level to an estimated 5 per cent.level in the coming 12-18 months as noted by JLL. However, the anticipated new space that was expected to have been delivered ontothe market has for a number of years been consistently overestimated. In 2007,for instance, 300,000 square metres was forecast by a number of property agentsto be delivered during the course of the year. However, half of this volume wasactually delivered by the year end according to a number of the same agents.This highlights a long term tendency to over optimism upon the part of localagents in respect of how much space developers are physically able to constructin a given year. This bias to over optimism is exacerbated by the nature of the Romanian officemarket. Many developments are announced at an early stage to attract interestfrom tenants and other interested parties. Delays often occur due to lack ofconstruction capacity, land title issues, difficulties over financing andplanning, particularly for the less experienced local developers. Theinvestment manager believes that between 140,000 square metres and 170,000square metres of new office space will be delivered onto the market during 2008,against current forecasts by a number of agents of over 300,000 square metres. The investment manager believes that the market will remain undersupplied withoffice space for the coming 3-5 years as both international and local investorsare becoming more cautious or scaling back their plans in the current financialclimate. With continued expansion by existing multinationals and new foreigndirect investment, the gap between supply and demand to the benefit of thelandlord developer will be maintained. In the medium term, the investmentmanager believes that Bucharest can sustain two million square metres of Class Aoffice space in line with the current stock of Budapest, the capital city of acountry with less than half the population of Romania. Even at two millionsquare metres, it will put Bucharest only at 25 per cent. of the level ofAthens, where Class A stock stands at eight million square metres. The investment manager's view regarding rent is supported by a report producedby JLL confirming that market-leading rental rates achievable in Central-NorthBucharest remain at levels between €22-24 per square metre per month, up some 20per cent. during 2007, whereas prime pre-leases of €17-19 per square metres areachievable. Construction costs are forecast by Bucharest based cost consultants to increasein 2008, a trend seen throughout Eastern Europe. This will have some impact fordevelopers on returns for new projects especially in weaker locations or wherethe land is over-priced. Set against this, increases in construction costs areanticipated to be more than off-set by continuing growth in rental and salesvalues. The investment manager continues to be prudent in selecting projects forconsideration by the Company's directors and aim to mitigate construction costrisks as far as possible by signing fix priced contracts and by keeping currentconstruction companies accountable for contracts signed. Strategy The investment manager will continue to assess whether each of the company'sassets continues to meet internal rate of return targets on a forward basis. Ifindividual assets are forecast to fail to meet required hurdles, they will beput up for sale. Any sale proceeds will be recycled for reinvestment in newprojects, assuming such acquisitions will deliver suitably attractive returns. As previously reported last quarter, some property investors, whose investmentstrategy involves high levels of gearing, have stepped back from transactions atthe more speculative end of the office investment market. In addition, someoverseas developers seeking to enter Romania or add to existing land holdingshave either decided not to enter the market or to become more cautious in thesize of schemes they are seeking to develop. The investment manager believesthis may be somewhat beneficial to the Company. As Romania continues to develop,it is not in the Company's interest for the property market to move from boom tobust but rather to exhibit a steadier rate of growth. If some of the moreambitious plans, from last summer, by foreign developers have been scaled backor cancelled, this is much to the benefit of the existing players in theRomanian property market such as Fabian. A number of attractive opportunities have been presented to the directors, someof which are at an advanced stage of negotiations. The Company will continue itssuccessful development strategy acting together with local and internationaldevelopment partners. The Timisoara deal represented the first deal for theCompany outside Bucharest and has marked the start of a greater focus goingforward for the Company both on the residential sub-sector and the regionalcities. A number of potential transactions are currently being evaluated inregional cities including both prospective residential and logistics developmentschemes. Investors and developers with less strong relationships with banks are findingit more difficult to attain competitive financing or financing at all. In somecases, this is likely to ensure an increased supply of relatively inexpensivebuildings where the owners are having financing difficulties. Fabian will seekto take advantage of such opportunities as they arise, particularly in light ofthe on-going strength of the office rental market and the investment manager'sexperience in this sub-sector. To date, the Company has not purchased any assets in the retail or logisticsmarkets. Retail developers have been aggressive in expansion plans to the extentthat a number of regional cities now have up to four shopping centre schemes onthe drawing board all due to compete with each other. For fully let centres, thecurrent shortage has meant high rents which the investment manager believes willfall as new supply of retail space comes onto the market. The retail market isthe least preferred sector in the investment manager's view. The Company has not, as yet, acquired any co-investment development projects inthe logistics sub-sector but is actively looking to do so. The amount oflogistics space developed to date in Romania is substantially insufficient forthe economy's current needs. A number of potential site acquisitions withprospective high quality development partners are being assessed to giveexposure to the logistics sub-sector with attractive forecast returns. Outlook and Share Price The Company's current co-investment development projects, with strongdevelopment partners, continue to make excellent progress and to set standardsin the country in their respective sub-sectors of the property market. 2008 isset to see construction start on the Lakeview, Romana and Timisoara schemes andnear completion on the Cubic Centre and New Town. This will mark a significantstep towards the realisation of a substantial part of DTZ's forecast DPNAV of€2.225 per share. The share price performance since the AIM IPO of FabianRomania Limited has been disappointing. It is of little consolation that theshare price might have outperformed its peer group on AIM over the course of thecredit crunch or that in Sterling terms the decline has been much less. Thedelivery of realised profits from development projects, forecast in 2009, willdrive the NAV per share, which the investment manager hopes will be reflected inthe Company's share price. In the meantime, the investment manager continues to actively market theCompany's shares to institutional investors both in the UK, on the continent andamongst new emerging market institutions in the Baltic States and Sweden. Tothis end, we are working closely with both our existing broker, Shore Capital,as well as the Company's new joint broker, KBC Peel Hunt, appointed for thisvery purpose. A number of property investor conferences have been attended andfurther attendances are planned. The Company's portfolio of office buildings is set to continue to benefit fromthe strength of the office leasing market. A number of attractive acquisitionopportunities are currently under consideration. The investment manager regardsthe outlook for the Company, the Romanian property market and Romania in generalas continuing to offer attractive opportunities for 2008 and beyond. Mark Holdsworth & Jan-Olof HanssonFabian Capital Limited28 April 2008 The directors of Fabian Romania Limited accept responsibility for theinformation contained in this announcement. To the best of the knowledge andbelief of the directors of the Company (who have taken all reasonable care toensure that such is the case) the information contained in this announcement isin accordance with the facts and does not omit anything likely to affect theimport of such information. Contacts: Fabian Capital LimitedMark Holdsworth Tel: +44 20 7499 9988 Deloitte Corporate Finance - Nominated Adviser to FabianJames Lewis Tel: +44 20 7936 3000 KBC Peel Hunt - Joint Broker to FabianCapel Irwin Tel: +44 20 7418 8900 Shore Capital Stockbrokers Limited - Joint Broker to FabianDru Danford Tel: +44 20 7408 4090 This information is provided by RNS The company news service from the London Stock Exchange