Alcaidesa development

Costain Group PLC
02 November 2005

Costain Group PLC

('Costain')


Alcaidesa development


Costain announces a significant land purchase by Alcaidesa, its Spanish joint
venture development business.

Alcaidesa Holding, in which Costain has a 50% share, has acquired a further 91
hectares of development land with the intention of adding approximately 600
residential units, a hotel and commercial facilities.

The consideration of approximately £17 million has been agreed on deferred
payment terms over the next three years.  It is hoped all relevant consents will
be secured by 2008.

The newly acquired land adjoins the existing 209 hectare interest known as San
Roque 3. The land forms part of an enclosed valley and will enable Alcaidesa to
further enhance the development potential of the enlarged holding.


Andrew Wyllie, Costain Chief Executive, said:

'This gives us a much enhanced platform from which to continue the growth of the
Alcaidesa development.  With our success to date in Spain and the forecast
growth in demand for properties in the region, we will look to grow our land
bank there during the course of 2006.'


                                                                 2 November 2005


Enquiries

Costain Group PLC                                        Tel: [phone]
Graham Read

College Hill                                             Tel: [phone]
Mark Garraway




Notes to Editors


•  Alcaidesa is located on the Costa del Sol within a few miles of Gibraltar.

•  Costain's joint venture partner in Alcaidesa is Banesto, one of Spain's
   leading banks and a subsidiary of Banco Santander.

•  The Alcaidesa development currently comprises a golf course, a 600-bed
   hotel and approximately 1,000 houses/ apartments completed and sold.
   Construction of a second golf course and clubhouse is already underway with
   completion set for 2006.

•  Land has been sold to other developers for a further 2,000 units (some
   already under construction) with further land sales contracted but not 
   completed (finalisation expected end of 2005 and early 2006).








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