Cal-Bay International, Inc. to Form Real Estate Investment Trust - REIT.

SAN DIEGO -- Cal-Bay International, Inc. (OTCBB:CBYI) announces plans to form an Equity Real Estate Investment Trust (REIT).

The Board of Directors of San Diego based Cal-Bay International, Inc. today announced plans to commence the formation of an Equity Real Estate Investment Trust (REIT).

Cal-Bay International, Inc. is currently a publicly traded real estate acquisition and development company with headquarters in San Diego, California. Cal-Bay International acquires, develops and manages real estate properties. As a Publicly traded company Cal-Bay offers investors greater liquidity, better governance and accountability of management, more timely reporting and more efficient transactions at a lower cost than comparable private companies.

Opportunity driven, Cal-Bay's philosophy is to grow shareholder value through value propositions with both substantial short and long-term potential. The Company plans to build its asset base and steadily grow revenues through a diversified portfolio of commercial, residential and industrial properties concentrated in geographical areas of highest growth.

Extensive due diligence and thorough market research are the foundation for each and every acquisition that must meet the Company's stringent "matrix for success." Our management team is experienced, successful and driven to increase shareholder value.

Cal-Bay International recognizes the importance of the reputation and integrity of the Company. It is a valuable asset vital to the Company's success. Therefore, the Board of Directors has implemented a Code of Conduct to be adhered to by each and every employee. The purpose of this Code is to encourage a culture of honesty, accountability and mutual respect among all employees to the benefit of our investors.

Three General Classifications of REIT's are:

       An Equity REIT: Corporation that purchases, owns and manages
       real estate properties; it does not own or originate real
       estate loans. It may also develop properties. Cal-Bay
       International is an Equity REIT. There are 152 Public Equity
       U.S. REITs.

       A Mortgage REIT: Corporation that purchases, owns and manages
       real estate loans; it does not own real estate properties. It
       may or may not originate commercial and/or residential loans.
       There are 34 Public Mortgage U.S. REITs.

       A Hybrid REIT: Corporation that purchases, owns and manages
       both real estate loans and real estate properties. It has the
       qualities of both an Equity and Mortgage REIT. There are
       7 Public Hybrid U.S. REITS.

REITs as an investment vehicle have gained uniform respect worldwide. "In 2004, the average publicly traded REIT share price was up 29.3%. In contrast, the average mutual fund gained 8.4%, and the Standard & Poor's 500-stock index rose 11.5%. Additionally, the average REIT had a 5.34% dividend yield vs. 1.8% for the S&P 500."

Source: National Association of Real Estate Investment Trusts

Today, a broad range of investors are using REITs to help achieve their investment goals, from large pension funds seeking diversification to tens of thousands of American Investors seeking a high quality investment.

Investors are attracted to REITs for their high-income yields paid out as dividends and the opportunity for long-term growth. These are the basic characteristics of real estate. In addition, investors looking for ways to diversify their investment portfolios beyond other common stocks as well as bonds are attracted to the unique characteristics of REITs.

There are 193 Public REITs registered with the Securities and Exchange Commission in the United States with total assets over $300 billion (NAREIT, March 31, 2005). As of December 31, 2002, two-thirds traded on the major national stock exchanges. In addition, there are many private REITs and a wide range of other real estate partnership vehicles.

Cal-Bay, International is currently redesigning its website, which when completed will be updated regularly and provide current information and events of the parent company and its subsidiaries.

FORWARD LOOKING SAFE HARBOR STATEMENT

To the extent that this release discusses any expectations concerning future plans, financial results or performance, such statements are forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended, and are subject to substantial risks and uncertainties. Actual results could differ materially from those anticipated in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof and reflect only management's belief and expectations based upon presently available information. These statements, and other forward-looking statements, are not guarantees of future performance and involve risks and uncertainties.

The Company assumes no obligation to update any of the forward-looking statements in this release.