Kalev                             ANNOUNCEMENT                      02.06.2005



REAL RIGHT CONTRACT CONCLUDED BY SUBSIDIARY



A real right contract was concluded on 31 May 2005 between AS Kalev Real Estate

Company (AS Kalev REC) and OÜ Workman on the transfer of ownership of the real

estate located at Tervise 5 in Tallinn. The ownership of the registered  immovable

was thus effectively transferred to AS Kalev REC.



With the total sales price amounting to 38 million  kroons, AS Kalev REC still

owned 35 million kroons to the seller on the moment of the conclusion of the

contract. AS Kalev REC obliges to pay the  above amount within at least three

banking days after the signing of the contract.



In addition, a mortgage was established by AS Kalev REC on the above real estate

for the benefit of AS Hansapank in the amount  of  33.8 million kroons with an

obligation for an owner to comply with an immediate compulsory execution.



According to Peeter Lillestik, member of the Management Board of AS Kalev REC,

the 4.3-hectare real estate at Tervise 5 is located in a highly prospective

neighbourhood, especially as regards residential real estate development.



The main field of activity of AS Kalev's subsidiary AS Kalev REC is real estate

development and management.





Ruth Roht

PR manager

+372 6 077 858