Tallinna Kaubamaja               STOCK EXCHANGE RELEASE                26.08.2005



LEASE AGREEMENT FOR TARTU KAUBAMAJA HAS BEEN CONCLUDED



On 25th August, 2005 Tallinna Kaubamaja Ltd. concluded a long term lease

agreement with Tartu Kaubamaja Kinnisvara OÜ for operating in Riia Street 1 in

Tartu. The planned sales area is 6700 sq m and the total lease area is 8300 sq m.

Tartu Kaubamaja Kinnisvara OÜ is a full subsidiary of Tallinna Kaubamaja

Kinnisvara Ltd.



At the end of September Tallinna Kaubamaja Ltd. will open a new Tartu Kaubamaja

(Tartu Department Store). At the same time reorganizations in Group will take

place. For the purpose to run the company more effectively and to cut costs, the

operator in new Tartu Kaubamaja will be Tallinna Kaubamaja AS. Until this time

the operator is Tartu Kaubamaja Ltd. which is a full subsidiary of Tallinna

Kaubamaja AS. Tallinna Kaubamaja AS will buy the goods and assets of Tartu

Kaubamaja AS.  Employees who work in Tartu Kaubamaja Ltd. will start to work for

Tallinna Kaubamaja AS.





Raul Puusepp

The Chairman of Board

Phone: +372 7 315 000