- Eurocastle Business Update
Guernsey. 22 January 2014 - Eurocastle Investment Limited (Euronext Amsterdam: ECT) ("Eurocastle" or the "Company") announces developments in new investments and legacy businesses.

Debt Investment & Real Estate Sales
· The Company has sold the remaining securities in the CDO IV portfolio for an average price of 96.4% of face value, equivalent to a yield of approximately 2.60%. After repaying the CDO IV facility in full, the sale has realised €22.5 million of NAV, resulting in a gain of €1.2 million since the third quarter. The remaining pool now consists of two junior loan investments with a total carrying value as at September 30, 2013 of €7.7 million.

· Further cash flow has been generated within Eurocastle's Wave real estate portfolio from the sale of four assets in December for total sales proceeds of €30.8 million. The sales have generated €3.5 million of distributable cash with the majority of the remaining proceeds used to partially repay the Wave facility in January; the balance outstanding has been reduced to €106.8 million (€131.5 million as at September 30, 2013). Separately, in light of the maturity of the Wave facility in April 2014, the Company is pursuing in parallel the possibility of a sale of the portfolio in whole as well as a potential refinancing.

New Investment Returns
· Using the additional capital realised from the legacy business together with existing corporate cash, the Company continues to pursue its investment targets in the Italian real estate sector. Earlier this month, the Group announced it was launching a joint tender offer with the GWM Group to each acquire up to 20% of the units of the Italian real estate fund UniCredito Immobiliare Uno. The tender price represents a premium of approximately 13.1 per cent. to the weighted average market price of the units registered in the 3 months prior to the announcement of the acquisition and a discount of approximately 38 per cent. to the most recently published NAV. If fully subscribed, the offer would result in an investment of approximately €60 million. The offer is currently under review by Commissione Nazionale per le Società e la Borsa (Consob), the Italian securities regulator, and if approved, the offering period is expected to begin sometime around the beginning of February. It is anticipated that final results will be announced at the end of the tender period and the Company will release further details of the investment thereafter.

· Whilst the Company continues to find the opportunity to invest in Italian NPLs compelling, it is disappointed that these investments have not materialised as quickly as anticipated. The Company believes this delay is due in part to the on-going ECB asset review process which is expected to be completed in the second half of 2014. Nevertheless Eurocastle remains optimistic that these opportunities will provide an attractive and continuous source of investments to Eurocastle for a number of years. The Company remains focused on its near term pipeline where negotiations continue on a number of NPL pools.

· In pursuing investments in direct Italian real estate, the Company has recently signed an agreement to strategically partner with a local investor and asset manager. The local partner will assist Eurocastle to source, acquire and develop vacant or inefficient real estate in prime locations in Rome and Milan for conversion into luxury residential units. To date, a total pipeline of up to €70 million of investment has been identified.

Real Estate Financing
· In advance of the Drive senior loan maturity on 20 January 2014, the Group has signed a binding term sheet with the lending syndicate of the Drive junior facility to refinance the senior loan for a term of two years. The Group has secured a short term extension of the current senior loan to 20 April 2014 pending the documentation of the two year extension of the facility. Eurocastle expects to agree short term extensions of the junior facility until the senior loan refinancing is secured.

· On 15 January 2014, the Bridge facility reached its maturity. The outstanding loan balance of €372.1 million had not been repaid and the Company has been unable to negotiate an extension. As such, the Bridge facility has been moved into special servicing. Eurocastle does not project any further cash flow from this portfolio. As at 30 September 2013, the Company reported an NAV of €27.7 million of which €2.6 million of cash has since been distributed to the Company.

About Eurocastle
Eurocastle Investment Limited is a closed-ended investment company that owns Italian loans and real estate related assets, German commercial real estate and European real estate securities and loans. The Company is Euro denominated and is listed on Euronext Amsterdam under the symbol "ECT". Eurocastle is managed by an affiliate of Fortress Investment Group LLC, a leading global investment manager. For more information regarding Eurocastle Investment Limited and to be added to our email distribution list, please visit www.eurocastleinv.com