Wednesday 28 August 2002

Railtrack Group has commenced the sale of its property development subsidiary Railtrack Developments (RDL), with the publication today of a Preliminary Information Memorandum. Jones Lang LaSalle Corporate Finance has been appointed to secure a buyer for the whole business which is to be offered as a going concern.

RDL is a unique business with a substantial portfolio of city centre development opportunities and a broadly based and highly experienced development team. These properties have been acquired both from other parts of Railtrack Group and from third parties in the open market.

The common theme to the majority of developments in RDL is their excellent locations around city centre transport nodes, and this is intended to remain the core of the business in the future. The portfolio comprises 24 early stage development properties with potential for redevelopment as offices, retail, leisure, mixed use and rail freight property. The book value of the portfolio as at 31 March 2002 was £32.9 million. It is estimated that the portfolio of development opportunities provides access to a potential development programme in excess of £2 billion.

Profit before interest and tax from Railtrack Developments was £7 million in the financial years ending 31 March 2002 and 2001.

Commenting on the sale of RDL, David Harding, Railtrack Group Chief Executive, said;
"Railtrack Developments is a unique portfolio of city centre development opportunities combined with an excellent management team. We believe that the sale of RDL as a going concern is in the best interests of Railtrack Group shareholders."

Helen Gordon, Managing Director of Railtrack Development Limited said:
"RDL has established itself as a leader in transport related property development. We are delighted that the business will be sold as a going concern and we remain focused on ensuring we continue to deliver for our tenants, partners and funders."

Rupert Clarke, Managing Director of Jones Lang LaSalle Corporate Finance:
"There are very few companies that can claim to have access to a development pipeline of this size and quality and RDL comes with the added benefit of a management team with a proven track record of delivery. We have already received a significant amount of interest in RDL and expect to achieve a substantial premium to current book value in the eventual sale."

For more information please contact:

Sue Clark Railtrack 020 7544 8436
All recent press releases can be found on the Railtrack web site www.railtrack.co.uk

Notes to Editors

1. Railtrack Developments Ltd is a commercial property development company wholly owned by Railtrack Group PLC.

2. It has a portfolio of 24 sites capable of supporting over 1.3 million sqm (14 million sq ft) of development for uses including office, retail, leisure, rail freight and residential.

3. Since 1998 the highly experienced team led by Helen Gordon, has secured planning consent for over 3.4 million sq ft (316,477sqm) and completed over ¾ million sq ft (71,447sqm) of office, retail and leisure development.

4. The team currently has 4 planning applications awaiting determination in London and the south east and is engaged in active negotiations for major pre lets and pre sales on a number of sites.

5. The potential value of the completed developments in the current portfolio is in excess of £2billion (RDL’s share) although to realise that value, significant further investment will be required.

6. Over the last 3 years RDL has consistently returned profits, pre tax and interest of around £7 million a year. 7 The decision to sell RDL follows Railtrack Group PLC‘s decision to sell its operating company, Railtrack PLC, to Network Rail.

7. Jones Lang LaSalle Corporate Finance has been appointed to seek a buyer for RDL and after advising Group that a sale of the business as going concern would generate the best return to Railtrack’s shareholders, formal marketing has commenced on that basis.

8. Earlier this year Jones Lang LaSalle Corporate Finance advised John Laing Plc on the successful sale as a going concern of its property development company Laing Property Ltd.

ENDS.

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