A closed mixed auction for the sale of 170,000 rights from the initial capital increase of City Developments REIT will be held on the BSE on October 17, 2007.

The company is planning a capital increase from the current 500,000 leva (255,645 euros) to 2.2 mln leva (1.124 mln euros). Each right will entitle to the subscription of 1 new share at a face and issue value of 10 leva.

Secondary trade with the rights will take place between 17 and 30 October and the deadline for subscription of shares from the capital increase is 23 November.

TBI Invest EAD is the manager of the increase procedures, and the bank account will be opened with CB United Bulgarian Bank.

City Development REIT has invested in two residential projects so far. These are the perlite Complex on Blvd Cherni Vrah and a project in the area of Ovcha Kupel also in Sofia.

The company will acquire 13 apartments and 2 garages in the first project at a price tag of a total of 1.328 mln leva (678,995 euros). The complex will be completed by April 2008. The management expects revenue to reach 2.008 mln leva (1.026 mln euros).

5 of the 13 apartments have already been sold and preliminary contracts have been signed for the remaining 8 (the deals will be finalized in December after completion of capital increase procedures).

The company will acquire 5 apartments, 1 garage, a shop/office and a gym in the second building. City has invested 644,000 leva (329,271 euros) in this projects, revenue is estimated at 964,000 leva (492,885 euros).

4 apartments have already been sold and there is a preliminary contract for the last one.

“We will use the funds from the capital increase to acquire the properties in the two projects mentioned,” company official Nikolay Dimitrov said. The funds necessary for the purchase of 1 apartment, the gym, the shop and 2 garages amount to 389,000 leva.

City Developments is currently completing the final stages of examination of a 4-decares land plot in Gorna Banya, and a preliminary contract for its purchase may be signed this week.

At the end of August the company's revenue from core activity stood at 849,000 leva (434,086 euros), and profit amounted to 226,000 leva (115,551 euros), or 4.52 leva/share.

Main shareholders are ET Rumen Vatkov II controlling 65% of capital, and TBI Dynamic and TBI harmony with 15% each. Financial and Business Consultants has 5%.