Optibase (OBAS)

Company launches best-in-class MPEG-4 AVC solution

        HERZLIYA, Israel, November 8, 2005 – Optibase, Ltd. (NASDAQ:OBAS) a leader in advanced digital video solutions today announced financial results for the third quarter ended September 30, 2005.

        Revenues for the third quarter ended September 30, 2005 were $5 million compared with $6.5 million in the second quarter of 2005 and $6.1 million for the same period a year ago.

        Net loss for the quarter ended September 30, 2005, was $176,000 or $0.01 per basic and fully diluted share, compared with a net income of $113,000 or $0.01 per basic and fully diluted share for the second quarter of 2005 and with a net loss of $641,000 or $0.05 per basic and fully diluted share for the third quarter of 2004. Weighted average shares outstanding used in the calculation for the periods were approximately 13.2 million basic and fully diluted for the third quarter of 2005, 13.2 million basic and 13.8 million fully diluted for the second quarter of 2005 and approximately 13.1 million basic and fully diluted for the third quarter of 2004.

        For the nine months ended September 30, 2005, revenues totaled $18.5 million, compared with $14.3 million for the same period in 2004. Net loss for the period was $237,000 or $0.02 per basic and fully diluted share, compared to a net loss of $841,000 or $0.06 per basic and fully diluted share for the nine months ended September 30, 2004. Weighted average shares outstanding used in the calculation for the periods were approximately 13.2 million and 13.1 million respectively.