July 7, 2010, Moscow: COMSTAR – United TeleSystems (COMSTAR-UTS, LSE: CMST), the leading provider of integrated telecommunication solutions in Russia and the CIS, discloses results of its performance on the Moscow commercial real estate market for the 2nd quarter and 1st half year of 2010.

In the 2nd quarter of 2010, COMSTAR-UTS concluded contracts for telecom services with a number of commercial real estate objects in Moscow. According to results for the 1st half year of 2010, the operator’s contract portfolio has accrued more than 2.8 million sq. m.

Thus, portfolio of COMSTAR contracts related to commercial real estate objects in Moscow now exceeds 9.5 million sq. m.

Some of the most important and large real estate objects that entered into agreements with the operator in the 2nd quarter of 2010 include the following business centers: Meyerkhold located at Novoslobodskaya street, Severnoye Siyanye located at Pravdy street 26, Gogolevsky 11 located at Gogolevsky boulevard 11, Pallau-SW located at Krzhizhanovskogo street, Nouvelle Building located at Stary Tolmachevsky side street 5, VENSKY DOM located at Petrovka street 27, Soyuz Business Park located at Luzhnetskaya embankment 2/4, as well as Azovsky, multi-purpose complex located at Azovskaya street. All of the above buildings belong to À+, À and  real estate classes.

As part of large projects related to telephone system installation for commercial real estate objects, COMSTAR-UTS mounts advanced high-tech equipment, installs fiber-optic cable and provides connection to NGN multi-service network owned by COMSTAR-UTS.

Tenants of selling and office spaces will get access to local, intra-zonal, intercity and international voice services, data and broadband services and will be able to order arrangement of VPN (virtual private network) with guaranteed quality level (SLA).

Summarizing performance results of the 2nd quarter and first half year, Roman Akatov, COMSTAR-UTS Commercial Director for Corporate Market Operations, said: “We have managed to continue expansion of COMSTAR-UTS presence on the Moscow commercial real estate market. Current portfolio of COMSTAR-UTS includes 380 real estate objects. We stand to our plans and we are steadily moving on to achieve our goal, i.e. 60-70% share. This high confidence level is a demonstration of efficiency of the business model chosen by COMSTAR, success of the pricing policy and unparallel service quality offered to our clients. Besides, one may definitely speak of certain investments in the future. Presently, a share of vacant commercial real estate spaces is still very high. However, as predicted by analysts, the situation will begin to change in the nearest future, and vacant spaces will get their owners and tenants that will promptly get access to a full package of integrated telecom services provided by our company.”

Additional information on the Moscow commercial real estate market:
According to leading consulting companies that publish their analytical reviews of the commercial real estate market, in 2009, the area of Moscow commercial property (business centers of À+, À, Â, Ñ classes, office and selling spaces) amounted to 14.4 million sq. m having accrued 12% as compared to 2008. In 2009, COMSTAR-UTS signed a number of contracts with commercial real estate objects, the aggregate area of which amounts to 2.0 million sq. m. Consequently, the total area of commercial real estate covered by COMSTAR-UTS amounted to 6.8 million sq. m by the end of 2009. Taken together with the first half year of 2010, this figure exceeds 9.5 million sq. m. This market share increased from 38% as of late 2008 to 47.6% as of late 2009. By the end of the 1st half year of 2010, this figure reached 59%. The current portfolio of COMSTAR-UTS contracts with corporate customers includes more than 380 commercial real estate objects.