Strategic Review

Gleeson(M J)Group PLC
31 March 2006



                             M J GLEESON GROUP PLC
                                Strategic Review

Following a comprehensive strategic review focused on the creation of
shareholder value, Gleeson has decided to concentrate on, and substantially
increase its involvement in, three related areas:

   • Housing Regeneration
   • Commercial Property Development
   • Strategic Land Trading

With regard to the Group's other activities:

   • The Group's highly regarded Engineering Division and Concrete Repairs
    Limited, which is the market leader in its sector, are both performing
    strongly. However, neither sits well within the Group's new business model.
    Moreover, the Board is aware that both businesses are likely to be of
    considerable interest to a range of parties who are committed to growth in
    the UK construction sector. The Board's objective will be to secure
    purchasers who can offer good value to shareholders, whilst providing
    enhanced career opportunities for the employees concerned.


   • The Group will undertake an orderly sale of its commercial property
    investment portfolio and non-housing PFI investments.


   • Gleeson Homes' activities outside the housing regeneration sector will
    be substantially reduced. In consequence, there will be a significant
    reduction in its non-strategic land holdings.


Housing Regeneration

The Group's regeneration operations will comprise: housing for sale, mainly on
land provided by local authorities and other public bodies; maintenance and
refurbishment services for social housing providers, particularly in the context
of the Government's Decent Homes Initiative; and social housing PFI projects.
Each of these three areas offers continuity of work over extended contractual
periods, reliable margins, improved returns on capital, and very substantial
opportunities for growth.

Gleeson Regeneration already has a very strong position as a partner of choice
for local authorities and other public bodies seeking to promote affordable
housing for sale. The division's existing portfolio of development agreements
and appointments as preferred bidder is expected to generate the construction
and sale of more than 7,000 homes over the next 10 years, and further successes
are anticipated.

Maintenance and refurbishment services will be provided by Powerminster, the
Group's mechanical and electrical services provider, which has a long and
successful track record in this sector, and by Gleeson AssetCare, a recently
formed subsidiary, which will concentrate on building services.

The introduction of a more flexible regulatory regime has led to a substantial
increase in the number of social housing PFI projects being offered to the
market. Gleeson's leading and successful role in the largest such scheme to
date, Plymouth Grove in Manchester, means that it is well positioned to benefit
from the considerable growth anticipated in this area.

Commercial Property Development

Gleeson Properties currently has 16 commercial property schemes in progress and,
against the background of a strong investment market and an improving level of
demand from occupiers, the Board believes that there is scope for significantly
expanding this development programme. In future, however, all completed projects
will be sold rather than retained as long-term investments, thus making it
possible to recycle capital more aggressively.

Strategic Land Trading

In 2005, Gleeson established Gleeson Strategic Land to manage and substantially
expand its strategic land bank, which has been assembled over the last 15 years
and currently comprises about 2,500 acres. Henceforth, virtually all of the
sites for which Strategic Land secures planning permission will be sold
externally, thus enabling the Group to continue to benefit from its considerable
experience and expertise in this area, whilst avoiding the costs and risks
associated with building for sale.

Gearing

The disposals arising from the refocusing of the Group's priorities (including
that of Gleeson MCL, announced last Friday, for a consideration of £23.3m) will
reduce its gearing very substantially and facilitate the financing of the
expansion of its continuing operations.

Cost Base

The Group's new strategy will enable it to make considerable reductions in
central and divisional costs. Gleeson's central services will be relocated to
Fleet in Hampshire, where Gleeson Homes is based. Gleeson's current Head Office
in Cheam, Surrey, will be sold.

The Board

It has been decided to reduce the size of the Main Board and to ensure that it
has a majority of non-executive directors. Responsibility for the Group's
operational management will be vested in an Executive Board.

With effect from 1 April 2006, only two executives - the Group Chief Executive
and the Finance Director - will serve as Main Board Directors; and, over the
coming months, the composition of the non-executive element of the Board will be
altered in the light of the requirements arising from the Group's new strategic
direction. Dermot Gleeson will continue to serve as Chairman.

The Executive Board will include the Group Chief Executive, the Finance
Director, and the Managing Directors of the Group's principal current business
streams.

Capital Structure

Once implementation of this strategy has been completed and net borrowings have
been reduced, further consideration will be given to the optimal capital
structure for the ongoing business.


Conclusion

Following last year's sale of Gleeson Building and last week's sale of Gleeson
MCL, the Group's new strategic direction will further reduce construction risk
and strengthen the Group's position in growth markets where it already has a
strong track record.

Furthermore, the focus on regeneration and land trading will generate better
returns on capital employed and unlock for shareholders the hidden value of the
Group's long-term regeneration agreements and strategic land options.

A review is underway to establish whether it might also be in shareholders'
interests for the Company to move to the Alternative Investment Market (AIM).

Enquiries:

M J Gleeson Group plc                                            020-8644 4321
Terry Massingham (Chief Executive)
Paul Wallwork (Finance Director)

Close Brothers Corporate Finance Limited
Peter Alcaraz                                                    020-7655 3139

Bankside Consultants Limited
Charles Ponsonby                                                 020-7367 8851




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