Valuation Report PO-36/2017

A portfolio of real estate assets in Russia (St Petersburg, Moscow, Yekaterinburg) and Germany (Leipzig, Landshut, Munich)

Prepared on behalf of LSR Group OJSC

Date of issue: March 12, 2018

Contact details

LSR Group OJSC, 15-H, liter Ǩ, 36, Kazanskaya St, St Petersburg, 190031, Russia Lyudmila Fradina, Tel. +7 812 3856106, [email protected]

Knight Frank Saint-Petersburg AO, Liter A, 3B, Mayakovskogo St., St Petersburg, 191025, Russia Svetlana Shalaeva, Tel. +7 812 3632222, [email protected]

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 1

Executive summary

The executive summary below is to be used in conjunction with the valuation report to which it forms part and, is subject to the assumptions, caveats and bases of valuation stated herein. It should not be read in isolation.

Location The Properties within the Portfolio of real estate assets to be valued are located in St. Petersburg and Leningradskaya Oblast', Moscow, Yekaterinburg, Russia and in Munich, Leipzig and Landshut, Germany.

Description The Subject Property is represented by vacant, partly or completely developed land plots intended for residential and commercial development and commercial office buildings with related land plots.

Areas Ɣ Buildings – see the Schedule of Properties below

Ɣ Land plots – see the Schedule of Properties below

Tenure Ɣ Buildings – see the Schedule of Properties below

Ɣ Land plots – see the Schedule of Properties below

Tenancies As of the valuation date from the data provided by the Client, the office properties are partially occupied by the short-term leaseholders according to the lease agreements.

Valuation Ɣ Commercial Properties. We’ve analysed both the office real estate market of St. considerations Petersburg and Moscow in general and the competitive environment of the Projects particularly to determine the market rental, vacancy and capitalization rates and OPEX for the Properties. We used this information to compare it with the data provided by the Client and to calculate the market rents after the lease expires if the current rent does not correspond to the market. Furthermore we’ve analysed the supply of the similar properties for sale. Thus the value was determined by reference to observable prices.

Ɣ Residential Properties. We’ve analysed both the residential real estate market of St. Petersburg and Leningradskaya Oblast’, Moscow, Yekaterinburg in general and the competitive environment of the Projects particularly to determine market prices, sales pace per quarter, price growth due to the inflation and project completion and construction costs. We used this information to compare it with the data provided by the Client and to calculate the market sales prices if the current prices do not correspond to the market. We assumed that sale prices information provided by the Client refers to the current average prices for the appropriate unit (apartment (per unit),

office or retail space (per sq. m) or parking lot (per unit)) as if the property was commissioned at the valuation date.

Ɣ We used CPI forecast of Ministry of Economic Development of Russian Federation to index the construction costs.

Ɣ Residential Properties. We’ve analysed average residential prices dynamics by classes and extrapolated it on indexing the income from sales.

Ɣ All the general comments set out in this report refer to all the Properties within the portfolio if only special assumption is not provided.

Ɣ All considerations, assumptions and market commentaries regarding the properties located in Germany are attached in Appendix 6 “Valuation of properties located in Germany”.

Ɣ To the Tax Code of Russian Federation residential development performed by contractors is not subject to VAT excluding commercial and parking construction in case of charging VAT from selling prices. Thus VAT paid on construction and other development costs can be offset only proportionally to the costs incurred in non- residential construction. Commercial properties are subject to VAT in full (long-term leasehold of the land plot) or in respect of the price apportioned to the building (freehold of the land plot) if only the owner’s company is not using Simplified Tax System. Thus we have assumed that all development costs and prices provided by the Client include VAT (where applicable). In our value calculations we applied cash flows including VAT.

Ɣ More detailed valuation considerations for the particular Properties within the portfolio are expressed in the description placed in the attachments to the report.

Valuation date December 31, 2017

Market Value 185,465,550,000 (One Hundred Eighty Five Billion Four Hundred Sixty Five Million (Fair Value), Five Hundred Fifty Thousand) RUB. rounded

Key assumptions Ɣ The Subject Property is represented by vacant, partly or completely developed land plots intended for residential (residential premises) and commercial (apartments) development (hereinafter referred to as Residential Properties) and by commercial office buildings with related land plots (hereinafter referred to as Commercial Properties). It is assumed that the buildings under construction will be completed in accordance with the identified plans and specification provided by the Client.

Ɣ We have been provided with the Properties’ title information by the Client. Nevertheless we have not been provided with all the ownership certificates and land long-term lease agreements to verify it. Thus, in our valuation, we have assumed a good and marketable freehold (to the land plots and buildings) or long-term leasehold (to the land plots) title and that all documentation is satisfactorily drawn.

Ɣ Several legal entities are the owners of the Properties within the portfolio. The Client has informed us that all these legal entities belong to LSR Group OJSC. Thus we assume that 100% ownership of LSR Group OJSC is to be valued.

Ɣ To the title documents provided by the Client, part of the Properties is either the shared ownership or leasehold. For a shared ownership we assume it is the share of freehold tenure of the Client in all the properties to be assessed. For leasehold property we assume it is freehold tenure of the improvements and leasehold of the land to be assessed.

Ɣ We assume that all the utilities (heating, cold and hot water, electricity, sewerage / drainage and telecommunications) are available to the Property at the site borders.

Ɣ We assume that public and social (including school) facilities for the future development are sufficient.

Ɣ We have adopted the Developer’s estimate of project costs (project budget) within our assessment.

Ɣ Development project costs provided by the Client consist of already incurred and estimated outstanding costs. Since we provide our opinion on the value as of the valuation date, in our calculations we have adopted only estimated outstanding costs.

Ɣ Residential Properties. Sales proceeds provided by the Client consist of anticipated income from already sold but unpaid units and estimated income from the unsold units. In our DCF calculations we have adopted only income estimated from the unsold units. We assumed that a hypothetic potential purchaser of the Property would normally be entitled to all the Property rights including claim rights for the payment for sold unpaid units. Thus, we have added anticipated income from already sold but unpaid units to the NPV.

Ɣ We have assumed construction period in accordance with the Developer’s envisaged timetable when in our opinion this timetable complied with construction periods witnessed at developments of a comparable scale. Otherwise our knowledge of similar developments suggested a construction period allowance of approximately 1 year (per phase if applicable).

Ɣ Residential Properties. We have assumed construction phasing in accordance with the Client’s envisaged phasing. In the absence of construction phasing information provided by the Client, we have adopted the most probable market construction phasing. We assumed 100,000 – 200,000 sq. m of buildings constructed within 1 phase.

Ɣ If a whole portfolio, or a substantial number of properties within it, were to be placed on the market at the same time, it could effectively flood the market, leading to a reduction in values. Conversely, the opportunity to purchase a particular group of properties might produce a premium. In other words, the value of the whole could exceed the sum of the individual parts, and vice versa. Since valuing is for a purpose of inclusion in financial statements that assumes that the portfolio will continue to remain in the existing ownership or occupation, it would be inappropriate to make any reduction or

allowance in the valuation to reflect the possible effect of flooding the market.

Ɣ To the Terms of Engagement the valuation of portfolio should be presented in the format of the report. Market researches, competitors analyses, and description of the Properties within the Portfolio are placed in attachments to the report.

Ɣ We draw your attention to the fact that values change over time and a valuation given on a particular date may not be valid on an earlier or later date. Our opinion of value is only current at the valuation date. This is particularly important in current market conditions and subsequent re-valuation(s) may need to be considered to reflect any changes in inputs after the valuation date.

Ɣ To comply with the requirement to state restrictions on use, distribution or publication in IVS 101 para 20.3(m) the report shall include reference to any conditions on how it may be reproduced or referred to in the published financial statements of the entity. The extent and form of any references to the valuation that may appear in the published financial statements is stated within the relevant sections of this report and in the Terms of Engagement.

Ɣ The extent of the valuers' duty including the response to any questions on the valuation raised by the entity's auditor is stated within the relevant sections of this report and in the Terms of Engagement.

Property risks Ɣ Contamination risk Ɣ Planning risk Ɣ Construction costs risk Ɣ Cost and time over-runs risk Ɣ Discount and capitalization rate increases risk Ɣ Market uncertainty risk

Contents

Executive summary 2

1. Instructions 10

Engagement of Knight Frank Saint-Petersburg AO 10

Scope of enquiries & investigations 20

Valuation bases 21 2. The property 21

Location 21

Site 21

Description 21

Accommodation 22

Services 22

Legal title 22

Tenancies 28

Condition 28

Environmental considerations 29

Sustainability 29

Planning (Residential Properties) 30

Highways and access 30

Statutory licences & certificates 31 3. Proposed development 32

Proposed scheme (Residential Properties) 32

Development costs (Residential Properties) 32 4. Market analysis 34

Market commentary 34

Russia economic overview 35

Investment market commentary 35

Office market overview 38

Residential market overview 38 5. Valuation 39

Highest and Best Use analysis 39

Methodology 39

Valuation considerations 41

Valuation bases 43

Valuation date 44

Market Value 44 6. Property risk analysis 49

General comments 49

Risks relating to the property 49

Income risks 50

Development risks 51

Economic & property market risks 53

Valuation risks 55 Appendix 1 Terms of Engagement/ General Terms of Business for Russian Valuations 56

Appendix 2 Description of the Properties 67

1. Kazanskaya 36 68

2. Zolotaya Kazanskaya 70

3. Paradny Kvartal BC 11 72

4. Kazanskaya 60 74

5. Smolny Park 76

6. Radishcheva 39 78

7. Verona 80

8. Neva Art, Neva Residence (REB Flota) 82

9. Neva Haus Bavaria 84

10. Dom na Dvoryanskoy 86

11. Osobnyak Truvorova 88

12. Russkiy dom (Baskov) 90

13. Europa City 92

14. Tri Vetra 94

15. Moskovskoye Hgwy (NEO, Hotel) 96

16. Morskoy Façade 98

17. Chyornaya Rechka 100

18. Bogemia 102

19. Yuzhnaya Aquatoriya 104

20. Sophiya 107

21. Kalina-Park 109

22. Novaya Okhta 111

23. Ruchyi/ Tsvetnoy Gorod Vostok 113

24. Ruchyi/ Tsvetnoy Gorod Zapad 115

25. Ruchyi-7 117

26. Shuvalovsky 119

27. Oktyabrskaya Naberezhnaya (Rudas, Barrikada) 121

28. Zapovednaya 123

29. Aeroport Rzhevka 125

30. Zvezdny Duet (Kosmonavtov/Dunayskiy) 127

31. Paradny Kvartal 129

32. Nevsky 1 131

33. Nevsky 68 133

34. Donskoy Olimp 135

35. Grunvald 137

36. Leningradskoye Shosse 58 139

37. ZIL-YUG 141

38. ZILART 144

39. Luchi 147

40. Krasny Mayak 150

41. Novoe Domodedovo 152

42. Nakhabino Yasnoe 155

43. Noviy Balchug 158

44. Avtozavodskaya 160

45. Tverskoy Blvd 162

46. Davydkovskaya 165

47. Rassvetny 168

48. Khrustalniye Klyuchi 170

49. Michurinskiy 173

50. Rastochnaya 177

51. Academichesky 179

52. Flagman 182

53. VIZ 185

54. Tsvetnoy Bulvar (Blyukhera) 188

55. Shefskaya 191

56. Voskhod 193 Appendix 3 Market overview 195

Office market overview of St. Petersburg 196

Office market overview of Moscow 207

Residential market overview of St. Petersburg and Leningradskaya Oblast’ 221

Residential market overview of Moscow 297

Residential market overview of Yekaterinburg 316 Appendix 4 – Residential market segmentation according to the current classification 333

Appendix 5 – Office market segmentation according to the current classification 336

Appendix 6 – Valuation of properties located in Germany 342

57. Leipzig 343

58. Landshut 350

59. Munich 358

Galina Aleksandrovna Volchetskaya

LSR Group OJSC 15-H, liter Ǩ, 36, Kazanskaya St, St Petersburg, 190031, Russia

Date of issue: March 12, 2018

Ref: PO-36/2017

Dear Ms. Volchetskaya,

Property: the portfolio of real estate assets in Russia (St Petersburg, Moscow, Yekaterinburg) and Germany (Leipzig, Landshut, Munich)

1. Instructions

Engagement of Knight Frank Saint-Petersburg AO Instructions 1.1 We refer to Agreement PO-36/2017 and to our subsequent Terms of Engagement letter and General Terms of Business for Valuations of December 15, 2017, to provide a valuation report on the portfolio of real estate assets in Russia (St Petersburg, Moscow, Yekaterinburg) and Germany (Leipzig, Landshut, Munich). Copies of Terms of Engagement letter and General Terms of Business for Valuations are attached in Appendix 1.

The properties that are the subject of this Valuation Report, each a Property and together the Properties are listed below as follows.

1.2 This valuation has been carried out in accordance with the Agreement PO-36/2017, the Terms of Engagement and our General Terms of Business for Russian Valuations (General Terms of Business), as attached in Appendix 1.

Client 1.3 Our client for this instruction is LSR Group OJSC (the Client).

Valuation 1.4 This valuation has been undertaken in accordance with the Royal Institution of standards Chartered Surveyors (RICS) Valuation - Professional Standards June 2017 Global & UK edition (the Red Book) including the International Valuation Standards (2017).

The report provided under this instruction has no status of valuation services in Russia and is not carried out in accordance with the requirements stipulated in the Federal Law On Valuation in the Russian Federation ȶ 135 dated July 29, 1998 as amended.

Purpose of 1.5 You have confirmed that this valuation report is required for the purposes of the valuation preparation of financial statements in accordance with International Financial Reporting Standards for the year 2017. It also may be used for publication on the Clients’ website, providing to counterparties and the attraction of investors.

In addition to the requirement to identify the asset to be valued in IVS 101 para 20.3(d) the scope of work shall include confirmation of how that asset is used or classified by the reporting entity.

The required accounting treatment for identical or similar assets or liabilities can differ according to how they are used by an entity. Commercial Properties within the portfolio are mainly owned by the entity for the purpose of the entity's business, residential Properties are treated as stock in trade like in the case of a development company.

Conflict of 1.6 In 2016 and 2017 we’ve already prepared Valuation reports No PO-17/2015 dated interest March 17, 2016 and No PO-20/2016 dated March 10, 2017 on the Portfolio of the Properties owned by the Client.

Nevertheless we confirm that we do not have any material connection or involvement giving rise to a conflict of interest and are providing an objective and unbiased valuation.

1.7 We are acting as External Valuers, as defined in the Red Book.

Responsibility to 1.8 Our valuation report is only for the use of our Client and no responsibility is accepted third parties to any third party for the whole or any part of its contents.

Disclosure & 1.9 Except as stated above, neither the whole nor any part of this valuation nor any publication reference thereto may be included in any published document, circular or statement nor published in any way without our prior written approval of the form or context in which it may appear. If our opinion of values is disclosed to the parties other than the addressee of this report, the basis of valuation should be stated.

Limitations on 1.10 No claim arising out of or in connection with this valuation report may be brought liability against any member, employee, partner or consultant of Knight Frank St Petersburg AO. Those individuals will not have a personal duty of care to any party and any claim for losses must be brought against Knight Frank St Petersburg AO.

1.11 Knight Frank St Petersburg AO’s total liability for any direct loss or damage caused by negligence or breach of contract in relation to this instruction and valuation report is limited to the amount specified in the Terms of Engagement letter/ General Terms of Business, a copy of which is attached. We do not accept liability for any indirect or consequential loss (such as loss of profits).

Expertise 1.12 The valuer, on behalf of Knight Frank St Petersburg AO with the responsibility for this report is Svetlana Shalaeva, RICS Registered Valuer, Head of Valuation Department, Knight Frank St Petersburg AO.

Parts of this valuation have been undertaken by additional valuers: Dmitry Tsatskin, Project Manager, Elena Dunenkova, Valuer, Galiya Chelysheva, Project Manager, Konstantin Fomin, Director, Key Client Manager, Valuations, Georgios Drakatos, Consultant as listed below in accordance with VPS 3 of the Red Book.

We confirm that the valuers meet the requirements of the Red Book, having sufficient current knowledge of the particular market and the skills and understanding to undertake the valuation competently. Furthermore we confirm that valuation has been undertaken by all the valuers involved in accordance with the Royal Institution of Chartered Surveyors (RICS) Valuation - Professional Standards June 2017 Global & UK edition (the Red Book) including the International Valuation Standards (2017).

Vetting 1.13 This report has been vetted as part of Knight Frank St Petersburg AO’s quality assurance procedures.

Table 1. List of the Properties within the portfolio

Leningradskaya Oblast' Business centers Lit ǩ, 36, 1 Kazanskaya 36 Kazanskaya St, 0.25 7,434.0 4,937 4,937 4,937 freehold operating offices 100% St.Petersburg Zolotaya 44, Kazanskaya St, 2 0.15 3,059.3 2,708 2,708 2,708 leasehold operating offices 100% Kazanskaya St.Petersburg Lit A, 39, Paradny Kvartal 3 Kirochnaya St, 9.57 3,718 2,886 2,886 2,886 12 leasehold operating offices 100% BC 11 St.Petersburg Lit A, 18, Fonarny land plot is 4 Kazanskaya 60 - 2,218.3 2,019 2,019 2,019 operating offices 100% Lane, St.Petersburg not formed TOTAL, business 9.97 16,429 12,549 12,549 centers Elite (A) class residential properties Lit A, 4, Smolnogo 5 Smolny Park 8.65 131,411 73,362 11,448 4,357 7,091 242 leasehold 100% 100% 79% St, St.Petersburg Phase 2, bldgs. 40,032 24,503 725 725 38 Mar-12 Dec-18 completed 100% 94% Ǩ2,5,6 Phase 3 49,844 22,949 172 172 171 Nov-12 Nov-18 completed 100% 92% Phase 4 41,535 25,910 10,551 3,461 7,091 33 Nov-13 Dec-21 completed 100% 55% Lit M, 39, 6 Radishcheva, 39 Radishcheva St, 0.85 31,923 20,879 276 276 2 Feb-13 Aug-18 freehold completed 100% 100% 98% St.Petersburg Lit A, 29, Morskoy 7 Verona 0.36 20,329 12,044 4,152 3,569 254 330 107 Aug-15 Dec-20 freehold completed 100% 86% 47% Pr, St.Petersburg Neva Art, Neva 17, Remeslennaya 8 Residence (REB 7.82 216,942 116,807 116,807 63,391 3,489 49,927 1,238 Mar-18 Jun-24 freehold design 100% 20% 0% St., St.Petersburg Flota) Neva Haus 9 9,11, Petrovskiy Pr. 6.28 190,789 110,838 83,189 79,453 3,736 879 Oct-17 Dec-23 freehold co ns tr uctio n 100% 31% 20% Bavaria Lit Ǩ, 13, Dom na 10 Kuybysheva St, 0.19 8,787 6,352 188 188 3 Feb-13 Sep-18 freehold completed 100% 100% 96% Dvoryanskoy St.Petersburg Osobnyak Lit A, 64, Martynova 11 0.21 1,212 1,212 1,212 1,212 Feb-18 freehold completed 100% 100% 0% Tr uvorova Emb, St.Petersburg

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 13

Breakdown of areas (unsold / unleased net area), sq m Presold / Stage of Net unsold Constru Estimate Project preleased development Net sellable / / unleased ction d sales complet of net (commissioning LSR Development Site Area, Gross building leasable area, net area, start complet ion, % sellable / No Address Parking, Tenure / construction/ share, Project ha area, sq m excl. car excl. car Residential Offices Retail Other date ion date (to the leasable lots design/ % parking, sq m parking, sq (month (month borne areas, incl. concept m / year) / year) costs) car development parking, % 5, Korolenko St, 12 Russkiy Dom 2.40 93,725 56,261 15,595 12,117 3,478 314 Apr-15 Jun-20 freehold co ns tr uctio n 100% 90% 56% St.Petersburg TOTAL, elite (A) class residential 26.76 695,118 397,755 232,867 properties Business (B) class residential properties Lit ǭ, 10, Medikov 13 Europa City 7.36 135,554 84,120 14,070 13,334 542 194 263 freehold 100% 99% 77% Av, St.Petersburg Phase 3 70,109 42,675 996 877 119 122 Mar-12 Jun-19 completed 100% 94% Phase 4 65,445 41,445 13,074 12,457 423 194 141 Apr-13 Jun-19 completed 98% 60% Plot 151, Block 66a, 14 Tri Vetra Savushkina St, 3.05 108,246 55,871 14,309 12,242 1,665 402 547 Jun-15 Dec-20 leasehold completed 100% 93% 48% St.Petersburg Moskovskoye Lit ǫ, Moskovskoye 15 9.15 40,124 24,210 17,840 2,999 1,784 13,057 122 freehold 100% 35% 22% Hgwy Hwy, St.Petersburg NEO 15,963 9,496 3,126 2,999 127 38 Dec-15 Dec-18 completed 79% 48% Hotel 24,161 14,714 14,714 0 1,784 12,930 84 Jun-18 Dec-21 design 3% 0% Nevskaya Guba, concept 16 Morskoy Façade 33.90 885,876 507,601 507,601 470,000 37,601 5,010 Mar-19 Dec-28 freehold 100% 6% 0% plots 12, 13, 14, 15 development 3, Lit. ǧ, Ǳ, ǫ, Chyornaya 17 Chernoy Rechki 1.68 53,098 32,701 32,701 30,659 2,041 200 Nov-18 Dec-21 freehold design 100% 1% 0% Rechka Emb. 14, Smolenskaya St, 18 Bogemia 0.69 34,352 21,965 10,126 9,793 334 102 May-16 Dec-20 freehold co ns tr uctio n 100% 65% 34% St.Petersburg TOTAL, business (B) class 55.83 1,257,250 726,467 596,647 residential properties Mass market (Ǹ) class residential properties Block 28, 28a, Yuzhnaya 19 Doblesti St, 23.90 538,320 326,971 71,142 24,619 13,938 32,585 2,154 leasehold 100% 82% 68% Akvatoriya St.Petersburg Yuzhnaya Aquatoria, plot 39,307 59 59 237 May-13 Dec-17 completed 100% 97% 13 Yuzhnaya Aquatoria, plot 63,576 186 110 75 424 Nov-12 Dec-17 completed 93% 97% 14

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 14

Breakdown of areas (unsold / unleased net area), sq m Presold / Stage of Net unsold Constru Estimate Project preleased development Net sellable / / unleased ction d sales complet of net (commissioning LSR Development Site Area, Gross building leasable area, net area, start complet ion, % sellable / No Address Parking, Tenure / construction/ share, Project ha area, sq m excl. car excl. car Residential Offices Retail Other date ion date (to the leasable lots design/ % parking, sq m parking, sq (month (month borne areas, incl. concept m / year) / year) costs) car development parking, % Yuzhnaya Aquatoria, plot 36,063 36,063 0 3,478 32,585 465 Mar-18 Dec-21 design 1% 0% 24 Yuzhnaya 56,878 825 72 752 248 Feb-15 Sep-19 leasehold completed 92% 86% Aquatoria, plot 9 Yuzhnaya 12,144 35 Dec-14 Dec-17 completed 99% 95% Aquatoria, plot 1 Yuzhnaya 87,279 33,925 24,293 9,633 445 Dec-15 Jun-20 co ns tr uctio n 89% 45% Aquatoria, plot 2 Yuzhnaya 31,724 85 85 300 Jan-14 Dec-17 completed 98% 96% Aquatoria, plot 6 Plots 3, 8, 12, 5, 7, 3*, 13, 8*, 1, Lit ǻ, 20 Sophiya 21.90 419,273 313,698 8,925 7,910 1,015 824 Mar-13 Dec-18 freehold co ns tr uctio n 100% 96% 91% 49, 6, Yuzhnoe Hwy, St.Petersburg 12, Marshala 21 Kalina Park Blukhera, 34.45 498,554 342,905 57,298 56,613 685 368 Dec-12 Dec-19 freehold co ns tr uctio n 100% 85% 75% St.Petersburg Murinskaya Road, 22 Novaya Okhta 88.28 915,323 764,833 197,151 192,556 4,595 2,962 Sep-12 Dec-20 freehold co ns tr uctio n 100% 74% 66% St.Petersburg Ruchyi Tsvetnoy 145, Piskarevsky Av, 23 163.92 1,294,091 1,023,081 976,573 894,818 25,754 56,000 5,827 May-16 Dec-25 freehold co ns tr uctio n 100% 12% 2% Gorod Vostok St.Petersburg Ruchyi Tsvetnoy 145, Piskarevsky Av, concept 24 199.27 2,012,612 1,390,780 1,390,780 1,369,310 21,470 7,225 May-23 Dec-33 freehold 100% 5% 0% Gorod Zapad St.Petersburg development 145, Piskarevsky Av, 25 Ruchyi-7 19.94 253,825 211,421 211,421 209,435 1,986 2,546 May-18 Jun-23 freehold design 100% 2% 0% St.Petersburg Plot 208, right to Prigorodny 26 Shuvalovsky 30.90 639,598 422,221 177,538 172,664 4,185 689 1,703 Jul-14 Jun-21 acquire co ns tr uctio n 100% 57% 49% (Kamenka), freehold St.Petersburg Oktyabrskaya 42, Oktyabrskaya 27 58.97 1,284,730 824,787 706,840 618,547 28,407 59,887 4,495 freehold 100% 10% 9% Naberezhnaya Emb, St.Petersburg Oktyabrskaya Naberezhnaya 30.46 692,951 437,783 319,836 245,401 14,549 59,887 2,575 Feb-16 Aug-23 co ns tr uctio n 16% 16% Rudas Oktyabrskaya Naberezhnaya 28.51 591,778 387,004 387,004 373,146 13,858 1,920 Jan-19 Dec-24 design 4% 0% Barrikada Plots 14,17, Orlovo- 28 Zapovednaya 5.92 134,874 89,055 89,000 86,759 2,241 750 Jun-19 Dec-22 freehold design 100% 23% 0% Denisovskiy Av.

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 15

properties 1-3, Paradnaya St, 31 Paradny Kvartal 9.57 12,607 12,074 12,074 12,074 Oct-12 freehold completed St.Petersburg 1, Nevsky Av, 32 Nevsky 1 0.25 9,357 8,509 8,509 8,509 20 Sep-16 Nov-19 freehold co ns tr uctio n St.Petersburg 68, Nevsky Av / Lit Ǩ, 40/68, Fontanka 33 Nevsky 68 0.15 8,400 8,400 8,400 8,400 26 freehold completed 100% River Emb, St.Petersburg TOTAL, commercial 9.97 30,364 28,983 28,983 properties TOTAL, properties, located in Saint- 927 11,651,067 7,952,032 5,832,058 Petersburg and Leningradskaya Oblast' Moscow and Moscovskaya Oblast' Business (B) class residential properties

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 16

Breakdown of areas (unsold / unleased net area), sq m Presold / Stage of Net unsold Constru Estimate Project preleased development Net sellable / / unleased ction d sales complet of net (commissioning LSR Development Site Area, Gross building leasable area, net area, start complet ion, % sellable / No Address Parking, Tenure / construction/ share, Project ha area, sq m excl. car excl. car Residential Offices Retail Other date ion date (to the leasable lots design/ % parking, sq m parking, sq (month (month borne areas, incl. concept m / year) / year) costs) car development parking, % Bldg 19, 21, 34 Donskoy Olimp Serpukhovsky Val 4.72 239,050 88,623 9,433 979 3,892 1,704 2,859 558 May-13 Jun-20 freehold completed 100% 96% 86% St, M os co w Zarechye Settlement, freehold to 35 Grunvald Odintsovo District, 4.10 58,331 27,260 1,526 593 933 94 Mar-05 Nov-20 Housing completed 100% 100% 92% Moscovskaya Code Oblast' Bldg 14, 21, 58 Leningradskoe 36 Leningradskoye 1.50 94,085 53,575 53,575 51,725 1,850 534 Mar-18 Apr-21 freehold design 100% 17% 0% shosse 58 Hwy, M os co w 23, Avtozavodskaya concept 37 ZiL Yug 59.30 708,256 485,301 485,301 410,921 74,380 5,718 Jan-20 Dec-31 leasehold 100% 3% 0% St, M os co w development 23, Avtozavodskaya 38 Zilart 65.09 1,487,445 961,127 838,095 643,495 194,600 10,859 Aug-15 Jun-27 leasehold co ns tr uctio n 100% 18% 8% St, M os co w TOTAL, business (B) class 134.71 2,587,167 1,615,885 1,387,930 residential properties Mass market (Ǹ) class residential properties Bldg 6, 39 (Vzlet) Luchi Proizvodstvennaya 39.09 899,585 477,409 342,383 293,527 43,771 5,085 3,270 Jan-16 Oct-26 leasehold co ns tr uctio n 100% 26% 21% St, M os co w 26, Krasnogo concept 40 Krasniy Mayak Mayaka St., 4.23 122,700 69,300 69,300 62,900 6,400 589 Nov-18 Mar-22 freehold 100% 11% 0% development M os co w Mikrorayon Zapadny, freehold to Novoe 41 Domodedovo, 39.34 567,063 317,786 188 188 376 Aug-11 Jul-20 Housing completed 100% 100% 98% Domodedovo Moscovskaya Code Oblast' near Chernaya Village, Pavlo- Slobodskoye freehold to Nakhabino 42 Settlement, 30.01 231,868 142,818 49,525 48,436 975 114 Dec-12 Dec-21 Housing co ns tr uctio n 100% 83% 60% Yasnoe Istrinsky District, Code Moscovskaya Oblast'

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 17

properties Bldgs. 1, 2, 3, 9, 43 Novy Balchug Sadovnicheskaya 0.40 24,360 10,995 10,995 10,995 170 Dec-14 Dec-20 leasehold co ns tr uctio n 100% 61% 0% St, M os co w TOTAL, commercial 0.40 24,360.14 10,994.77 10,995 properties Business centers 22, Avtozavodskaya 44 Avtozavodskaya 0.64 7,767 6,871 6,871 6,871 16 leasehold operating offices 100% St, M os co w 16, Tverskoy Blvd, 45 16, Tverskoy Blvd 0.14 4,904 2,292 2,292 2,292 15 leasehold operating offices 100% M os co w 16, Davydkovskaya 45 Davydkovskaya 1.14 1,808 1,737 1,737 1,737 6 leasehold operating offices 100% St, M os co w TOTAL, business 1.91 14,479 10,900 10,900 centers TOTAL, properties, located in 249.69 4,447,221 2,645,093 1,871,220 Moscow and Moscovskaya Oblast' Yekaterinburg Mass market (Ǹ) class residential properties 2B, 40-Letiya 47 Rass vetny Komsomola St, 8.75 208,583 145,043 1,967 1,921 46 237 Feb-14 Sep-19 freehold co ns tr uctio n 100% 98% 97% Yekaterinburg Khrustalniye Latviyskaya St, 48 11.02 289,661 224,401 170,785 168,446 179 2,160 Apr-14 Sep-24 leasehold co ns tr uctio n 100% 28% 21% Klyuchi Yekaterinburg Sukhodolskaya St, 49 Michurinsky 50.94 346,427 270,642 121,053 120,517 276 260 267 Nov-12 Dec-22 freehold co ns tr uctio n 100% 60% 53% Yekaterinburg Rastochnaya St, 50 Rastochnaya 0.54 19,541 14,027 5,183 5,183 Jun-16 Jul-18 freehold co ns tr uctio n 100% 91% 52% Yekaterinburg

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 18

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 19

Scope of enquiries & investigations Inspection 1.14 You have instructed us to undertake a restricted service, namely: we have carried out limited external inspection of all the Properties within the portfolio, internal inspection of business centres in St. Petersburg.

Our limited inspection of the Properties was undertaken on December 16, 2017 – February 23, 2018 by

Ɣ Galia Chelysheva, Project Manager – in Yekaterinburg,

Ɣ Konstantin Fomin, Director, Key Client Manager, Valuations, Knight Frank AO – in Moscow,

Ɣ Elena Dunenkova, Valuer, and Svetlana Shalaeva, Head of Valuation, Knight Frank St Petersburg AO – in St. Petersburg;

Ɣ Cristoph Gerlinger, Georgios Drakatos, Simon Volz, Knight Frank Germany – in Munich, Leipzig and Landshut respectievely.

We assume there have been neither material changes to the physical attributes of the property, nor changes to the nature of its location, since the last inspection up to valuation date.

This fact significantly limits the extent to which reliance can be placed upon this valuation report.

Investigations 1.15 The extent of enquiries/ investigations made is set out in our General Terms of Business. In carrying out this instruction we have undertaken verbal/ web based enquiries referred to in the relevant sections of this report. We have relied upon this information as being accurate and complete.

Information 1.16 In this report we have been provided with information by the Client. We have relied provided upon this information as being materially correct in all aspects.

1.17 In particular, we detail the following:

Ɣ Information relating to the extent of the property, produced by special services of public authorities Title documents (ownership certificates and lease agreements);

Ɣ Information relating to the proposed development scheme, produced by the Client;

Ɣ Information relating to the planning status of the Property, from the Client;

Ɣ Information relating to the construction costs, terms of project realization of the proposed development as produced by the Client;

Ɣ Information relating to the sales prices of the proposed development as produced by the Client.

The information pointed above is not attached to this report but is kept in the valuers’ archive and can be provided at a request if necessary.

1.18 In the absence of any documents or information provided, we have had to rely solely upon our own enquiries as outlined in this report. Any assumptions resulting from the lack of information are also set out in the relevant section of this report.

1.19 In the presence of data difference in the documents or information provided, we have had to rely upon our own enquiries or more precise information provided by the Client as outlined in this report. Any assumptions resulting from the lack of information are also set out in the relevant section of this report.

Valuation bases 1.20 In accordance with your instructions, we have provided opinions of value on the following bases:

Market Value 1.21 The Market Value (Fair value) of the freehold interest in the Properties in its current Fair value physical condition, subject to the existing tenancy / ies / with vacant possession (where applicable) or intended for / in course of development according to the proposed development scheme, produced by the Client (where applicable). Our key assumptions are set out in the Valuation Section of this report.

Valuation date 1.22 The valuation date is December 31, 2017

2. The property

Location Location 2.1. The brief description of the location and the street plans of the Properties within the portfolio are attached in Appendix 2.

Site Site area 2.2. The brief description of the sites of the Properties within the portfolio are attached in Appendix 2.

Description General 2.3. The brief description of the Properties within the portfolio and its images are information attached in Appendix 2.

Accommodation Measurement 2.4. We were not able neither to inspect internally all the buildings and sites within the portfolio nor to take sample check measurements to ensure that the measurements fall within acceptable tolerance.

Thus we have relied upon the measurements of Property areas provided to us by the Client.

2.5. A breakdown of floor areas by tenancy is not attached to this report but is kept in the valuers’ archive and can be provided at a request if necessary.

2.6. The valuation given does not include any plant & machinery or contents within the property.

Services 2.7. In accordance with the General Terms of Business enclosed in Appendix 1, no tests have been undertaken on any of the services.

2.8. Specifications on connecting utilities are not provided.

We have assumed for the purposes of this valuation that mains heating, cold and hot water, electricity, sewerage / drainage and telecommunications will be all available for the properties under development (in course of construction).

We also have assumed that these services will have sufficient capacity to accommodate the proposed development and that no works are required to upgrade their capacity. Should any upgrades be required and the costs required are to be borne by the Developer, our opinion of property value may be affected.

Legal title Land register 2.9. As stated in our General Terms of Business, we do not undertake searches or searches inspections of any kind (including web based searches) for title or price-paid information in any publicly available land registers.

Sources of 2.10. We have been provided with the Properties’ title information by the Client. Information Nevertheless we have not been provided with all the ownership certificates and land long-term lease agreements to verify it. Thus, in our valuation, we have assumed a good and marketable freehold (to the land plots and buildings) or long-term leasehold (to the land plots) title and that all documentation is satisfactorily drawn.

2.11. We recommend that our understanding of all legal title issues is referred to your legal advisers for their confirmation that our understanding is correct. It is also particularly important that your legal advisers should be asked to check whether there have been any transactions relating to the property which reveal price paid information which we should be made aware of.

2.12. If any matters come to light as a result of your legal adviser’s review of these issues,

we request that these matters are referred back to us as this information may have an important bearing upon the values reported.

Tenure 2.13. Thus we have made the assumption that that title to the Properties is the following (presented in the table below):

Table 2. Tenure

Gross Site Area, No Development Project Address Land owner building Building owner Tenure ha area, sq m

Saint-Petersburg and

Leningradskaya Oblast' Business centers Lit ǩ, 36, Kazanskaya St, 1 Kazanskaya 36 0.25 A Plus Estate AO 7,434.0 A Plus Estate ZAO freehold St.Petersburg 44, Kazanskaya St, 2 Zolotaya Kazanskaya 0.15 A Plus Estate AO 3,059.3 A Plus Estate ZAO leasehold St.Petersburg LSR. Lit A, 39, Kirochnaya St, Nedvizhimost'- 3 Paradny Kvartal BC 11 9.57 3,718 leasehold St.Petersburg Severo-Zapad OOO Lit A, 18, Fonarny Lane, land plot is 4 Kazanskaya 60 - A Plus Estate AO 2,218.3 A Plus Estate ZAO St.Petersburg not formed TOTAL, business centers 9.97 16,429 Elite (A) class residential

properties Lit A, 4, Smolnogo St, 5 Smolny Park 8.65 Smolny Park OOO 131,411 leasehold St.Petersburg Phase 2, bldgs. Ǩ2,5,6 40,032 Phase 3 49,844 Phase 4 41,535 Stroitelnaya Korporatsiya Lit M, 39, Radishcheva St, 6 Radishcheva, 39 0.85 Vozrozhdeniye 31,923 freehold St.Petersburg Sankt-Peterburga OAO Stroitelnaya Korporatsiya Lit A, 29, Morskoy Pr, 7 Verona 0.36 Vozrozhdeniye 20,329 freehold St.Petersburg Sankt-Peterburga OAO LSR. Neva Art, Neva Residence 17, Remeslennaya St., Nedvizhimost'- 8 7.82 216,942 freehold (REB Flota) St.Petersburg Severo-Zapad OOO LSR. Nedvizhimost'- 9 Neva Haus Bavaria 9,11, Petrovskiy Pr. 6.28 190,789 freehold Severo-Zapad OOO Stroitelnaya Korporatsiya Lit Ǩ, 13, Kuybysheva St, 10 Dom na Dvoryanskoy 0.19 Vozrozhdeniye 8,787 freehold St.Petersburg Sankt-Peterburga OAO Stroitelnaya Stroitelnaya Korporatsiya Korporatsiya Lit A, 64, Martynova Emb, 11 Osobnyak Truvorova 0.21 Vozrozhdeniye 1,212 Vozrozhdeniye freehold St.Petersburg Sankt-Peterburga Sankt-Peterburga OAO OAO LSR. 5, Korolenko St, Nedvizhimost'- 12 Russkiy Dom 2.40 93,725 freehold St.Petersburg Severo-Zapad OOO TOTAL, elite (A) class 26.76 695,118 residential properties

Gross Site Area, No Development Project Address Land owner building Building owner Tenure ha area, sq m

Business (B) class residential

properties Stroitelnaya Korporatsiya Lit ǭ, 10, Medikov Av, 13 Europa City 7.36 Vozrozhdeniye 135,554 freehold St.Petersburg Sankt-Peterburga OAO Phase 3 70,109 Phase 4 65,445 LSR. Plot 151, Block 66a, Nedvizhimost'- 14 Tri Vetra Savushkina St, 3.05 108,246 leasehold Severo-Zapad St.Petersburg OOO LSR. Lit ǫ, Moskovskoye Hwy, Nedvizhimost'- 15 Moskovskoye Hgwy 9.15 40,124 freehold St.Petersburg Severo-Zapad OOO NEO 15,963 Hotel 24,161 LSR. Nevskaya Guba, plots 12, Nedvizhimost'- 16 Morskoy Façade 33.90 885,876 freehold 13, 14, 15 Severo-Zapad OOO LSR. 3, Lit. ǧ, Ǳ, ǫ, Chernoy Nedvizhimost'- 17 Chyornaya Rechka 1.68 53,098 freehold Rechki Emb. Severo-Zapad OOO LSR. 14, Smolenskaya St, Nedvizhimost'- 18 Bogemia 0.69 34,352 freehold St.Petersburg Severo-Zapad OOO TOTAL, business (B) class 55.83 1,257,250 residential properties Mass market (Ǹ) class

residential properties LSR. Block 28, 28a, Doblesti St, Nedvizhimost'- 19 Yuzhnaya Akvatoriya 23.90 538,320 leasehold St.Petersburg Severo-Zapad OOO Yuzhnaya Aquatoria, plot 13 Yuzhnaya Aquatoria, plot 14 Yuzhnaya Aquatoria, plot 24 Yuzhnaya Aquatoria, plot 9 leasehold Yuzhnaya Aquatoria, plot 1 Yuzhnaya Aquatoria, plot 2 Yuzhnaya Aquatoria, plot 6 Plots 3, 8, 12, 5, 7, 3*, 13, LSR. 8*, 1, Lit ǻ, 49, 6, Nedvizhimost'- 20 Sophiya 21.90 419,273 freehold Yuzhnoe Hwy, Severo-Zapad St.Petersburg OOO LSR. 12, Marshala Blukhera, Nedvizhimost'- 21 Kalina Park 34.45 498,554 freehold St.Petersburg Severo-Zapad OOO LSR. Murinskaya Road, Nedvizhimost'- 22 Novaya Okhta 88.28 915,323 freehold St.Petersburg Severo-Zapad OOO LSR. 145, Piskarevsky Av, Nedvizhimost'- 23 Ruchyi Tsvetnoy Gorod Vostok 163.92 1,294,091 freehold St.Petersburg Severo-Zapad OOO LSR. 145, Piskarevsky Av, Nedvizhimost'- 24 Ruchyi Tsvetnoy Gorod Zapad 199.27 2,012,612 freehold St.Petersburg Severo-Zapad OOO

Gross Site Area, No Development Project Address Land owner building Building owner Tenure ha area, sq m

LSR. 145, Piskarevsky Av, Nedvizhimost'- 25 Ruchyi-7 19.94 253,825 freehold St.Petersburg Severo-Zapad OOO LSR. right to Plot 208, Prigorodny Nedvizhimost'- 26 Shuvalovsky 30.90 639,598 acquire (Kamenka), St.Petersburg Severo-Zapad freehold OOO 42, Oktyabrskaya Emb, 27 Oktyabrskaya Naberezhnaya 58.97 1,284,730 freehold St.Petersburg LSR. Nedvizhimost'- Oktyabrskaya Naberezhnaya Severo-Zapad 30.46 692,951 Rudas OOO / LSR. Stenoviye materialy OOO LSR. Nedvizhimost'- Oktyabrskaya Naberezhnaya 28.51 Severo-Zapad 591,778 Barrikada OOO / Tsementniy elevator, OAO LSR. Plots 14,17, Orlovo- Nedvizhimost'- 28 Zapovednaya 5.92 134,874 freehold Denisovskiy Av. Severo-Zapad OOO Airport Rzhevka, LSR. Kovalevo Settlement, Nedvizhimost'- 29 Aeroport Rzhevka 175.00 1,585,763 freehold Vsevolozhsky District, Severo-Zapad Leningradskaya Oblast' OOO Plots 1,2, Kosmonavtov LSR. Zvezdny Duet Pr. (south-east of Nedvizhimost'- 30 2.43 74,943 leasehold (Kosmonavtov/Dunayskiy) Svirskaya St crossing), Severo-Zapad St.Petersburg OOO TOTAL, mass market (Ǹ) 824.88 9,651,905 class residential properties Commercial properties Stroitelnaya Korporatsiya 1-3, Paradnaya St, 31 Paradny Kvartal 9.57 12,607 Vozrozhdeniye freehold St.Petersburg Sankt-Peterburga OAO Stroitelnaya Stroitelnaya Korporatsiya Korporatsiya 1, Nevsky Av, Vozrozhdeniye 32 Nevsky 1 0.25 9,357 Vozrozhdeniye freehold St.Petersburg Sankt-Peterburga Sankt-Peterburga OAO / Nevinvest OAO OOO LSR. LSR. 68, Nevsky Av / Lit Ǩ, Nedvizhimost'- Nedvizhimost'- 33 Nevsky 68 40/68, Fontanka River 0.15 8,400 freehold Severo-Zapad Severo-Zapad Emb, St.Petersburg OOO OOO TOTAL, commercial 9.97 30,364 properties TOTAL, properties, located in Saint-Petersburg and 927 11,651,067 Leningradskaya Oblast' Moscow and Moscovskaya

Oblast' Business (B) class residential

properties Bldg 19, 21, LSR. 34 Donskoy Olimp Serpukhovsky Val St, 4.72 Nedvizhimost'-M 239,050 freehold Moscow AO Zarechye Settlement, LSR. freehold to 35 Grunvald Odintsovo District, 4.10 Nedvizhimost'-M 58,331 Housing Moscovskaya Oblast' AO Code Bldg 14, 21, 58 MSR-BUTOVO 36 Leningradskoe shosse 58 Leningradskoye Hwy, 1.50 94,085 freehold OOO Moscow

Gross Site Area, No Development Project Address Land owner building Building owner Tenure ha area, sq m

23, Avtozavodskaya St, 37 ZiL Yug 59.30 Zil-Yug OOO 708,256 leasehold Moscow LSR. Ob'ekt'-M 23, Avtozavodskaya St, 38 Zilart 65.09 AO/Promob'ekt 1,487,445 leasehold Moscow OOO TOTAL, business (B) class 134.71 2,587,167 residential properties Mass market (Ǹ) class

residential properties Bldg 6, LSR. 39 (Vzlet) Luchi Proizvodstvennaya St, 39.09 Nedvizhimost'-M 899,585 leasehold Moscow AO LSR. 26, Krasnogo Mayaka St., 40 Krasniy Mayak 4.23 Nedvizhimost'-M 122,700 freehold Moscow AO Mikrorayon Zapadny, LSR. freehold to 41 Novoe Domodedovo Domodedovo, 39.34 Nedvizhimost'-M 567,063 Housing Moscovskaya Oblast' AO Code near Chernaya Village, Pavlo-Slobodskoye LSR. freehold to 42 Nakhabino Yasnoe Settlement, Istrinsky 30.01 Nedvizhimost'-M 231,868 Housing District, Moscovskaya AO Code Oblast' TOTAL, mass market (Ǹ) 112.67 1,821,216 class residential properties Commercial properties Bldgs. 1, 2, 3, 9, Velikan-XXI vek 43 Novy Balchug Sadovnicheskaya St, 0.40 24,360 leasehold OOO Moscow TOTAL, commercial 0.40 24,360.14 properties Business centers 22, Avtozavodskaya St, 44 Avtozavodskaya 0.64 A Plus Estate AO 7,767 A Plus Estate AO leasehold Moscow 16, Tverskoy Blvd, Arkhproekt MTO 45 16, Tverskoy Blvd 0.14 4,904 leasehold Moscow OAO 16, Davydkovskaya St, 45 Davydkovskaya 1.14 A Plus Estate AO 1,808 A Plus Estate AO leasehold Moscow TOTAL, business centers 1.91 14,479 TOTAL, properties, located in Moscow and 249.69 4,447,221 Moscovskaya Oblast' Yekaterinburg Mass market (Ǹ) class

residential properties LSR. 2B, 40-Letiya Komsomola 47 Rassvetny 8.75 Nedvizhimost'- 208,583 freehold St, Yekaterinburg Ural ZAO LSR. Latviyskaya St, 48 Khrustalniye Klyuchi 11.02 Nedvizhimost'- 289,661 leasehold Yekaterinburg Ural ZAO LSR. Sukhodolskaya St, 49 Michurinsky 50.94 Nedvizhimost'- 346,427 freehold Yekaterinburg Ural ZAO LSR. Rastochnaya St, 50 Rastochnaya 0.54 Nedvizhimost'- 19,541 freehold Yekaterinburg Ural ZAO LSR. Verkhneuphaleyskaya St, 51 Akademichesky 13.46 Nedvizhimost'- 292,002 freehold Yekaterinburg Ural ZAO LSR. 52 Flagman (Repina-Zavodskaya) Repina St, Yekaterinburg 3.39 Nedvizhimost'- 137,189 freehold Ural ZAO LSR. 53 VIZ Bol`shoy Konnyy 14.30 Nedvizhimost'- 245,722 freehold Ural ZAO

Gross Site Area, No Development Project Address Land owner building Building owner Tenure ha area, sq m

LSR. 54 Tsvetnoy Bulvar Bl'ukhera 6.05 Nedvizhimost'- 181,629 freehold Ural ZAO LSR. 11, Shefskaya St, 55 Shefskaya 11 1.76 Nedvizhimost'- 32,128 freehold Yekaterinburg Ural ZAO LSR. 25, 40-Letiya Komsomola 56 Voskhod 1.20 Nedvizhimost'- 47,479 freehold St, Yekaterinburg Ural ZAO TOTAL, properties, located 111.41 1,800,361 in Yekaterinburg Germany 57 Leipzig 0.54 25,000 freehold 58 Landshut 0.12 2,500 freehold 59 Munich 0.08 1,446 freehold TOTAL, properties, located 0.74 28,946 in Germany TOTAL, properties 1,289.24 17,927,594

In the absence of a copy lease, we have assumed that normal covenants and liabilities devolve upon the lessee. It is further assumed that there are no onerous restrictions or outgoings contained within the lease that would impact on the valuation provided within this report.

The owners of the Properties within the portfolio are several legal entities. We have been informed by the Client that all these legal entities are parts of LSR Group OJSC. Thus we assume that 100% ownership of LSR Group OJSC is to be valued.

To the title documents provided by the Client part of the Properties are either the shared ownership or leasehold. For the shared ownership we assume it is the share of freehold tenure of the Client in all the properties to be assessed. For leasehold property we assume it is freehold tenure of the improvements and leasehold of the land to be assessed. 2.14. These assumptions should be verified by your legal advisors. If they prove incorrect, any variation may have a material impact on value and should be referred back to us for further comment.

Rights of way 2.15. From the title documents we noted rights of way and easements referred to some of the Properties within the portfolio, which may potentially have a detrimental impact upon the valuations in this report. We recommend that your legal advisers are instructed to investigate this matter further.

Tenancies Vacant 2.16. Residential Properties. We have valued all the Properties within the portfolio being possession either under development (in course of construction) or intended for future development on the assumption of vacant possession.

Commercial Properties. As some commercial Properties and business centres within the portfolio are multi-tenanted i.e. occupied by the owner and other tenants we have valued it on the assumption of vacant possession after the lease expires.

Tenancy 2.17. Commercial Properties. We have been provided with the tenancy information by the information Client and have relied on that information as being correct. If the contract does not specify the expiration date we assumed the contract shall expire with one year after the valuation date. No additional verification has been undertaken.

Condition Scope of 2.18. As stated in the General Terms of Business attached, we have not undertaken a inspection building or site survey of the property.

2.19. During our limited inspection we did not inspect any inaccessible areas .We are unable to confirm whether the property is free from urgent or significant defects or items of disrepair.

Comments 2.20. Apart from any matters specifically referred to below, we have assumed that it is in sound order and free from structural faults, rot, infestation or other defects, and that the services are in a satisfactory condition.

At the date of inspection, the buildings (where applicable) appeared to be in a generally reasonable state of repair commensurate with their age and use. No urgent or significant defects or items of disrepair were noted which would be likely to give rise to substantial expenditure in the foreseeable future or which fall outside the scope of the normal annual maintenance programme.

Ground 2.21. We have not been provided with a copy of a ground condition report for the sites. conditions Residential Properties. We have assumed that there are no adverse ground or soil conditions and that the load bearing qualities of the site are sufficient to support the building constructed thereon.

Residential Properties. We have also assumed that no special efforts related to site preparation except already planned by the Client will be required for development.

Residential Properties. Should any preparations be required and the costs required are to be borne by the Developer, our opinion of property value may be affected.

Mining 2.22. The property is not situated in an area within which specialist consultants recommend that an Archive Mining Survey is commissioned due to former mining. Our valuation assumes that the property is not affected by mining, but, in the event that a survey reveals an adverse position, our valuation could be materially affected.

Environmental considerations Flooding 2.23. We have been unable to ascertain the risks of flooding relating to the subject property. We have therefore assumed that the risk is low due to the existing flood defence system of St Petersburg (Dam) and will not affect the property’s value.

Contamination 2.24. As stated in the General Terms of Business, investigations into environmental matters would usually be commissioned from suitably qualified environmental specialists. Knight Frank St Petersburg AO is not qualified to undertake scientific investigations of sites or buildings to establish the existence or otherwise of any environmental contamination, nor do we undertake searches of public archives to seek evidence of past activities which might identify potential for contamination.

2.25. Subject to the above, while carrying out our valuation inspection, we have not been made aware of any uses conducted at the subject property that would give cause for concern as to possible environmental contamination. Our valuation is provided on the assumption that the property is unaffected.

High voltage 1.23 The possible effects of electric and magnetic fields from high voltage electrical supply equipment equipment is a matter for specialist advice and we have assumed that there is no adverse effect on value.

Noise pollution 2.26. There are no airports, underground or train way in the vicinity of the Properties’ location. Nevertheless measuring noise pollution is a matter for specialist advice and we have assumed that there is no adverse effect on value.

Sustainability Sustainability 2.27. The issue of sustainability is becoming increasingly important to participants in the property market. There is a general expectation that buildings that minimise environmental impact through all parts of the building life cycle and focus on improved health for their occupiers may retain value over a longer term than those that do not.

Sustainable buildings should optimise utility for their owners and occupiers and the wider public, whilst minimising the use of natural resources and presenting low environmental impact, including their impact on biodiversity. Definitions of sustainability address both social equity, for example, indigenous and affordable aspects, and environmental impacts, including energy use, both within and upstream of the building itself, in terms of the resources consumed in creating and operating it.

2.28. Some of the key issues relating to a building’s sustainability are:

Ɣ Land use; Ɣ Design and configuration; Ɣ Construction materials and services; Ɣ Location and accessibility considerations; Ɣ Fiscal and legislative considerations;

Ɣ Management and leasing issues. 2.29. From a value perspective, sustainability is likely to be a long term issue and its relative importance will change over time. Our valuation provides our opinion of value at the valuation date based on market related factors at that date.

EPCs 2.30. The properties within the Russian Federation do not require an Energy Performance Certificate (EPC) when bought, sold, built or rented. An EPC measures the asset rating of a building in relation to its energy performance.

Planning (Residential Properties) Sources of 2.31. We have not made any enquiries of the appropriate Planning Authority in respect of planning matters affecting the Properties. Where reassurance is required on planning matters, information we recommend that formal written enquiries should be undertaken by your legal advisors who should also confirm the position with regard to any legal matters referred to in our report. We assume that property will be constructed and will be occupied or used in accordance with the appropriate permissions and that there are no outstanding statutory notices.

2.32. These enquiries should not be taken as personal searches and information on the relevant website is assumed to be both accurate and up to date. For a formal planning enquiry to be made, the Local Authority will require written representation which has not been possible as part of our report.

2.33. We have been informed by the Client that the Property is intended for residential (residential premises) and commercial (apartments) development.

We have not been provided with further planning information by the local authorities and we depend on all information provided by the Client.

Thus it is assumed that the buildings to be constructed will comply with all necessary Planning and Building Regulation approvals as appropriate.

Construction 2.34. The Client has provided us the copies of planning permissions for the Properties permit within the portfolio under development (in some cases for the current phase of construction). For the Properties intended for future development design projects are being prepared; thus planning permissions are not still obtained.

Planning 2.35. The property is not located within a Conservation Area. restrictions

Highways and access Highways 2.36. We are unaware of any highway proposals that may have a detrimental effect on the value of the Properties.

Residential Properties. We have assumed that all estate roads within the proposed scheme will be adopted and maintained at the expense of the Highways Authority.

Access 2.37. In reporting our opinion of value, we have assumed that there are no third party interests between the boundary of the Properties and the adopted highways and that accordingly the Properties has unfettered vehicular and pedestrian access.

2.38. We have assumed that there are no issues relating to visibility splays which may impact upon the use or proposed use of the Properties.

Statutory licences & certificates 2.39. The Subject Property is represented by undeveloped or partly developed land plots intended for residential and commercial development. Thus future development requires project design preparation and approval, and further construction permit obtaining. Construction permit is a document, which approves that project document complies with construction land plan or complies with plan of the territory, complies with survey of the territory in case of construction and re-construction of the buildings, complies with all regulations, statutory licences & certificates including health and safety standards, fire safety standards and access for disabled persons provision standards.

Residential Properties. Hence we have assumed in our valuation that property development will be undertaken in accordance with all regulations, statutory licences & certificates necessary to be complied with.

Commercial Properties. For the commercial office buildings with related land plots within the portfolio we have assumed in our valuation that all regulations have been complied with.

Leadership in 2.40. Some properties may have a Leadership in Energy and Environmental Design Energy and Certificate (LEED) when they are constructed, let or sold. Leadership in Energy and Environmental Environmental Design (LEED) is one of the most popular green building certification Design (LEED) program used worldwide. Developed by the non-profit U.S. Green Building Council (USGBC) it includes a set of rating systems for the design, construction, operation, and maintenance of green buildings, homes, and neighborhoodsthat aims to help building owners and operators be environmentally responsible and use resources efficiently.

We are unaware of Client’s plans in respect of existing and future buildings LEED Certification. We have not seen any such documents relating to the property and cannot comment further in this regard.

Access for 2.41. Disability discrimination legislation provides that the majority of organisations must disabled persons make provision for disabled persons to have access to the goods and services they provide. This refers to both non-residential and residential buildings. This may require an access audit of the property to be undertaken and for specific arrangements relating to physical aspects of the building. We have not been provided with any information in this respect and our valuation has been undertaken on the assumption that the property is capable of being made fully compliant at no

significant additional cost with all relevant disability access requirements.

Fire safety 2.42. It is a requirement for a fire safety risk assessment to be carried out and for a fire management plan to be maintained.

We have not viewed any such documents relating to the property and have assumed for the purposes of our valuation that the relevant requirements will be fully complied with.

3. Proposed development

Proposed scheme (Residential Properties) Source of 3.1. The Client provided us the design parameters for the construction of Properties information development considered in the valuation as the highest and best use.

Scheme outline 3.2. The design parameters of Properties development, provided by the Client, are attached in Appendix 2 within the description of the Properties.

Proposed 3.3. We have relied upon floor areas provided to us by the Client. accommodation We recommend that the design parameters for the construction are confirmed by the Developer’s architect.

3.4. A summary of the proposed specification is set out in Appendix 2 within the Properties’ description. In general terms we believe the proposed schemes are adequate for the developments of this nature and in this location. This will have a positive impact on the properties value because the costs to be beard will be warranted by the achievable sales and rental rates.

Building 3.5. In reporting our opinions of value we have assumed that the schemes are compliant Regulations with all Building Regulations and can be implemented in accordance with the plans provided. In the event that amendments need to be made to the proposed scheme as a consequence of it failing to meet statutory requirements, our opinions of value may be affected.

Rights of lights 3.6. We have assumed that the proposed scheme does not raise any issues with regard to rights of light and that no third parties are entitled to compensation and that no injunctions could be made in this respect.

Development costs (Residential Properties) General 3.7. As stated in our General Terms of Business, we strongly recommend that you supply comment us with build cost and other relevant information prepared by a suitably qualified construction cost professional, such as a quantity surveyor. We do not hold ourselves out to have expertise in assessing build costs and any property valuation advice provided by us will be stated to have been arrived at in reliance upon the build cost information supplied to us by you.

3.8. To verify build cost information supplied to us, we have had regard to published build cost information. There are severe limitations on the accuracy of build costs verified by this approach and professional advice on the build costs should be sought by you. The reliance which can be placed upon our advice in these circumstances is severely restricted. If you subsequently obtain specialist in build cost advice, we recommend that we are instructed to review our advice.

Source of cost 3.9. We have been supplied with a summary of the development project costs provided information by the Client.

Development project costs include construction costs, costs of utilities, site purchase and preparation (demolition of existing building excluding monuments of culture and art), project design and concept costs, engineering, and expenses for consultants and miscellaneous.

Construction costs include all the fees, material and labour costs incurred in building a structure. It involves construction of foundation, frames, overlappings, roof, openings (doors and windows), external walls with fit-out, floors fit-out.

Utilities include electricity and lightening and low-voltage systems, water supply and sewerage, gas.

Site preparation includes access road construction (if needed), existing buildings demolition, land plot clearing and levelling, drainage systems construction.

We have been provided with the development project costs (project budget) by the Client and have therefore relied upon them. Nevertheless we have undertaken web based enquiries referred to the development cost figures to verify the data provided by the Client. We have compared Client’s figures with the development cost figures (excl. land plot acquisition costs) produced by other developers and published on their web sites in the project declarations.

According to the opinion of experts from Knight Frank St Petersburg Strategic Consulting Department the applied construction costs are in line with the market level. The additional verification of the applied construction costs is based on the experience of several consultancies for different development projects and on information from quantity surveyor and construction companies.

Build costs 3.10. In light of the above evidence, we have adopted the Developer’s estimate of project adopted costs (project budget) outlined above within our assessment. These development costs include VAT and exclude sales and marketing costs and legal and finance costs required to complete the scheme as set out in the excel tables with input provided by the Client.

These development project costs consist of already incurred and estimated outstanding costs. Since we provide our opinion on the value as of the valuation date, in our calculations we have adopted only estimated outstanding costs.

The information provided by the Client and pointed above is not attached to this

report but is kept in the valuers’ archive and can be provided at a request if necessary.

3.11. Our valuation has been undertaken upon the assumption that the build costs adopted by us above are adequate to complete the development to the scheme adopted by us. Any variation in the build costs may have a significant impact upon the reported Market Value of the Properties. In this respect we additionally draw your attention to the importance of our recommendation in relation to the appointment of an independent quantity surveyor below.

Construction 3.12. We have assumed construction period in accordance with the Developer’s envisaged period and timetable when in our opinion this timetable complied with and reflected phasing construction periods witnessed at developments of a comparable scale.

Otherwise our knowledge of similar developments suggested a construction period allowance of approximately 1 year (per phase if applicable).

3.13. We have assumed construction phasing in accordance with the Client’s envisaged phasing. In the absence of construction phasing information provided by the Client, we have adopted the most probable market construction phasing. We have assumed 100,000 – 200,000 sq. m of buildings constructed within 1 phase. We based on the experience due to several consulting service for different development projects and information from quantity surveyor and construction companies

3.14. Our assumed build costs have been inflated to account for predicted build cost inflation through the life of the development. This is because we have assumed that the Developer could not negotiate a fixed price contract at the outset of the development at the level of our assumed costs due to the long term construction period.

We have used the CPI forecast by the Ministry of Economic Development of Russian Federation to index the construction costs.

4. Market analysis

Market commentary 4.1. It should be appreciated that this section of the valuation report is published for general information only and while rigorous research has been used in preparing this analysis, the views and projections provided in the report should not form the basis of any formal decision. Being a general report, the material does not necessarily represent the view of Knight Frank St Petersburg AO in relation to specific properties or projects and no responsibility can be accepted by Knight Frank St Petersburg AO resulting from the contents of the document.

Source of 4.2. Our market analysis has been undertaken using market knowledge within Knight information Frank and Knight Frank St Petersburg AO, enquiries of other agents, searches of

property databases, as appropriate and any information provided to us.

Russia economic overview 4.3. 1. GDP growth in 2014: 0.7%; in 2015: -3.7%; 2016: -0.2%; 2017: 2.0%, 2018: 1.5%; 2019: 1.5%; 2020: 1.5% (2017 – 2020 – base forecast prepared by Ministry of Economic Development of the Russian Federation 1)

2. Inflation in 2016: 6.4%; in 2017: 2.5% (December 2017 to December 2016), 2018: 4.0%, 2019: 4.0%, 2020: 4.0% (2018 – 2020 – base forecast prepared by Ministry of Economic Development of the Russian Federation 2)

3. Unemployment rate in November 2016: 5.4%; November 2017: 5.1%3

4. Key rate: 7.75%

5. Exchange Rates as at December 31, 2017: RUB 57.6002 per 1 USD; RUB 68.8668 per 1 Euro4

6. EURIBOR 12M as at December 31, 2017: -0.190%5

7. LIBOR USD 12M as at December 31, 2017: 2.043%6

Investment market commentary Background 4.4. There were a number of events in the Russian economy directly or indirectly affecting the investment climate in the country. Against the backdrop of a record low inflation (3.3%), the Central Bank of Russia decided to reduce the key rate to 7.75% per annum. This factor positively affects the investment attractiveness of the real estate market.

Negative factors include serious problems that banking sector has faced. Central Bank of Russia was forced to start the procedure for reorganization in several large Russian banks, such as Otkrytiye and Bin Bank. It is also worth noting that contrary to investors’ expectations; the easing of West sanctions did not happen. Opposite the President of the US, Donald Trump, has signed the law on widening sanctions against Russia, as a result of which investors are forced to take a more balanced approach to

1http://economy.gov.ru/wps/wcm/connect/ff96ff83-cc36-4bd8-ad2a-c31f4b15d5ba/1704062.pdf?MOD=AJPERES&CACHEID=ff96ff83-cc36- 4bd8-ad2a-c31f4b15d5ba

2http://economy.gov.ru/minec/about/structure/depMacro/20151026

3http://www.gks.ru/bgd/free/B15_00/Main.htm http://www.gks.ru/bgd/free/B16_00/Main.htm

4 http://cbr.ru/

5 Average in December: http://www.global-rates.com/interest-rates/euribor/euribor-interest-12-months.aspx

6 Average in December: http://www.global-rates.com/interest-rates/libor/american-dollar/usd-libor-interest-rate-12-months.aspx

the choice of objects for investment.

Financing 4.5. Since sanctions limitations in 2014 Russian investors still are not able to attract available financing as opposed to international funds that have an access to global capital markets. This fact resulted in the low domestic investors' activity.

At the same time, a high interest in buying land plots for residential development remains. The residential sector in St Petersburg remains the largest and most capacious in spite of the weakening demand of end customers and the slowdown in sales in the real estate investment market. 85% of completed investment transactions in St. Petersburg in 2017 accounted for large companies, holdings and funds. Demand from foreign investors in St. Petersburg is even less than in Moscow, and their share is inferior to the average Russian (in the third quarter it was 3% in St. Petersburg, 16% in the second quarter).

Supply/ 4.6. The overall volume of deals in the first three quarters of 2017 decreased by 3.5% Demand compared to the same period of last year and amounted to $1.93 billion. At the same time, it is worth noting a sharp decline in investor activity only in the third quarter, while the first two quarters demonstrated good dynamics, which allowed to predict the exceedeing of the aggregate indicators of 2016. The overall volume of investment transactions in the third quarter of this year was $ 229.3 million, which is one of the lowest quarterly indicators for the last 5 years.

Office (43%) and retail (41%) segments traditionally dominate in the structure of transactions.

Graph 1. Investment volume in commercial real estate / Capital outflow

Source: Knight Frank Research, 2017

Graph 2. Commercial real estate investment volume divided by segments

Source: Knight Frank Research, 2017

4.7. The largest volume of investment was directed to the retail segment in 2017. It reached 44% of the total volume mainly due to the large portfolio transaction on the sale of shopping centres by Immofinanz to the Russian company Fort Group. The share of the office segment accounted for 38% of the total investment amount, the warehouse segment - 6%.

In 2017, the share of foreign investment rose by 2% amounting to 13% if compared to the last year's figures. Especially worth highlighting was the long-awaited transaction involving Chinese investors, who purchased the business centre Vozdvizhenka Centre. The Russian real state market remained high-yielding for foreign investors, but it was high-risk at the same time, forcing them to carefully weigh all decisions and, thus, stretching the terms of transactions. Nevertheless,the general stabilization in the real estate market (mainly the rental rates increase and the vacancy reduction) is attracting more and more new players. Therefore, the share of foreign investments in the total volume of investment transactions can come up significantly.

The Moscow region was the most investment attractive region traditionally accounting for more than 80% of the total volume of investment transactions. There, the retail and office segments were the most popular, with 46% and 38% of the total volume of investments to the Moscow region, respectively.

According to the results of 2017, the investments in the real estate market of St Petersburg ran at the record-high value over the past several years - $562 million. As a result of the year, the share of foreign investments in the total volume of transactions increased to the level of 22%.

Capitalization 4.8. During 2017 the average prime yields remained at 10.5% for offices, at 11.0% for rate retail and at 12.5% for warehouses.

Potential 4.9. Domestic developers are the main potential buyers of large-scale assets, i.e. land purchasers plots for residential development. Less likely, investment funds who look for medium

to long-term investment. Moreover, share of international players is very low and tends to shrink further.

Office market overview Summary 4.10. St Petersburg and Moscow office market overviews are attached in Appendix 3.

Evidence of 4.11. We’ve analysed both the office real estate market of St Petersburg and Moscow in comparable general and the competitive environment of the Projects particularly to determine lettings and the market rental, vacancy and capitalization rates and OPEX for the Properties. We sales used this information to compare it with the data provided by the Client and to calculate the property value if the current rent does not correspond to market. Furthermore we’ve analysed the supply of the similar properties for sale.

Competitive environment analysis for the commercial office Properties and business centres within the portfolio follow appropriate office market overview (St Petersburg and Moscow) and are attached in Appendix 3.

Residential market overview Summary 4.12. St Petersburg, Moscow and Yekaterinburg residential market overviews are attached in Appendix 3.

Evidence of 4.13. We’ve analysed both the residential real estate market of St Petersburg and comparable Leningradskaya Oblast’, Moscow , Yekaterinburg in general and the competitive sales environment of the Projects particularly to determine market prices, sales pace per quarter, price growth due to the inflation and project completion. We used this information to compare it with the data provided by the Client and to calculate the market sales prices if the current prices do not correspond to the market. We assumed that sale prices information provided by the Client refers to the current average prices for the appropriate unit (apartment (per unit), office or retail space (per sq. m) or parking lot (per unit)) as if the property was commissioned at the valuation date.

We’ve analysed average residential prices dynamics by classes and extrapolated it to index the income from sales.

Competitive environment analysis for the Properties being either under residential development (in course of construction) or intended for future residential development within the portfolio follow appropriate residential market overview (St Petersburg, Moscow and Yekaterinburg) and are attached in Appendix 3.

5. Valuation

Highest and Best Use analysis 5.1. The analysis of relevant data to develop a market value opinion requires two important steps in the valuation process before the applicable approaches to value are applied. Market/marketability analysis begins the process of narrowing the focus from a broader macro view to data that is especially pertinent to the appraised property (see Section 4). Highest and best use relies on that analysis to identify the most profitable, competitive use to which the subject property can be put. The highest and best use is shaped by the competitive forces within the market where the property is located and provides the foundation for a thorough investigation of the competitive position of the property in the minds of market participants.

5.2. The highest and best use analysis allows to define the most profitable and competitive use of the real estate property, i.e. the use, which guarantees the highest value of the subject property.

The highest and best use includes four compulsory criteria:

Ɣ Physical possibility – physical possibility of constructing a building for the highest and best use of the subject site;

Ɣ Legal possibility – planned use should correspond to the current legislation restricting use of the site;

Ɣ Financial feasibility – the legally acceptable use of the site should guarantee income to the owner;

Ɣ Highest effectiveness – the highest and best use implies either maximization of owner's net income, or value of the subject property.

5.3. Residential Properties. We have assumed that the development scheme of the Properties within the portfolio either under development (in course of construction) or intended for future development provided by the Client and described in this report is consistent with the highest and best use of the Properties as of the valuation date. Thus we recommend that our assumption on the proposed development scheme adoption was referred to the appropriate legal and planning advisors. Any alteration of the proposed scheme may cause the failure to maximising value.

Commercial Properties. We have assumed that the current use of the office real estate within the portfolio is the highest and best use of the Properties at the valuation date.

Methodology 5.4. Our valuation has been undertaken using appropriate valuation methodology and our professional judgement.

Market 5.5. The market approach provides an indication of value by comparing the subject Approach property with identical or comparable (that is similar) assets for which price information is available.

Market Approach is the most commonly used and accepted method in ascertaining the market value of properties. This approach entails comparing the subject property with similar properties that were sold recently and those that are currently being offered for sale in the vicinity or other comparable localities. The characteristics, merits and demerits of these properties are noted and appropriate adjustments thereof are then made to arrive at the value of the subject property.

5.6. Residential Properties. Taking into account the type of the Properties within the portfolio, namely being either under development or intended for future development land plots assumed as suitable for residential and commercial development, we believe that the Market Approach is not appropriate for its valuation.

Commercial Properties. In undertaking our valuation of the commercial office Properties within the portfolio, we made our assessment only on the basis of a collation and analysis of appropriate comparable negotiations due to the lack of evidence of comparable sales transactions.

5.7. Market Approach was applied to market value assessment of the commercial office Properties within the portfolio.

Income 5.8. The income approach provides an indication of value by converting future cash flow Approach to a single current value. Under the income approach, the value of a property is determined by reference to the value of income, cash flow or cost savings generated by the property.

Income Approach is normally used for development land or projects. The Residual Method is a generally accepted method for valuing properties that are considered to have possible development potential.

This approach entails estimating the gross development value of the development components and deducting them from the development costs to be incurred, i.e. preliminary expenses, statutory payments, earthworks, infrastructure and building construction costs, professional fees, contingencies, project management fees, marketing and legal fees, financing costs, developer’s profits and other costs (if any) to arrive at the residual value. This residual value appropriately discounted for the period of development and sale is deemed to be the present market value of the subject property.

5.9. Taking into account the type of the properties, we believe that Income Approach is appropriate for its valuation.

Residential Properties. The Client’s projects are assumed to be the highest and best development of Subject Properties. This concept requires estimating forthcoming net

operating income (NOI – sales or rental or both of them), deducting outstanding development costs (total project budget) from NOI and discounting resulting cash flow (CF) to calculate net present value (NPV). Thus, for the purposes of valuation the concept of construction and future selling is considered.

Commercial Properties. Current use of commercial office Properties and business centres within the portfolio is assumed to be the highest and best use. This concept is applicable for the vacant commercial office Properties and requires estimating forthcoming NOI (Effective Gross Income (EGI) purified from operating expenses (OPEX)), and discounting resulting CF to calculate NPV. Thus, for the purposes of valuation the concept of future letting and selling in the end of the forecast period is considered.

5.10. In some instances, particularly when the property is operating at a stabilised level of growth and profits at the valuation date, it may not be necessary to consider an explicit forecast period and a terminal value may form the only basis for value (sometimes referred to as an income capitalisation method).

For commercial properties within the portfolio being operated (and occupied by tenants) the income capitalisation method can be applied.

Cost Approach 5.11. The cost approach provides an indication of value using the economic principle that a buyer will pay no more for a property than the cost to obtain a property of equal utility, whether by purchase or by construction, unless undue time, inconvenience, risk or other factors are involved. The approach provides an indication of value by calculating the current replacement or reproduction cost of a property and making deductions for physical deterioration and all other relevant forms of obsolescence.

5.12. Taking into account the type of the property, we believe that Cost Approach is not appropriate for its valuation.

Valuation considerations 5.13. Ɣ Commercial Properties. We’ve analysed both the office real estate market of St Petersburg and Moscow in general and the competitive environment of the Projects particularly to determine the market rental, vacancy and capitalization rates and OPEX for the Properties. We used this information to compare it with the data provided by the Client and to calculate the market rents after the lease expires if the current rent does not correspond to the market. Furthermore we’ve analysed the supply of the similar properties for sale. Thus the value was determined by reference to observable prices.

Ɣ Residential Properties. We’ve analysed both the residential real estate market of St Petersburg and Leningradskaya Oblast’, Moscow , Yekaterinburg in general and the competitive environment of the Projects particularly to determine market prices, sales pace per quarter, price growth due to the inflation, project completion and construction costs. We used this information to compare it with

the data provided by the Client and to calculate the market sales prices if the current prices do not correspond to the market. We assumed that sale prices information provided by the Client refers to the current average prices for the appropriate unit (apartment (per unit), office or retail space (per sq. m) or parking lot (per unit)) as if the property was commissioned at the valuation date.

Ɣ We have used the CPI forecast by the Ministry of Economic Development of Russian Federation to index the construction costs.

Ɣ Residential Properties. We’ve analysed average residential prices dynamics by classes and extrapolated it on indexing the income from sales.

Ɣ All the general comments set out in this report refer to all the Properties within the portfolio if only special assumption is not provided.

Ɣ All considerations, assumptions and market commentaries regarding the properties located in Germany are attached in Appendix 6 “Valuation of properties located in Germany”.

Ɣ To the Tax Code of Russian Federation residential development performed by contractors is not subject to VAT excluding commercial and parking construction in case of charging VAT from selling prices. Thus VAT paid on construction and other development costs can be offset only proportionally to the costs incurred in non-residential construction. Commercial properties are subject to VAT fully (long-term leasehold of the land plot) or in respect of the price apportioned to the building (freehold of the land plot) if only the owner’s company is not using Simplified Tax System. Thus we have assumed that all development costs and prices provided by the Client include VAT (where applicable). In our value calculations we have applied cash flows including VAT.

Ɣ More detailed valuation considerations for the particular Properties within the portfolio are expressed in the description placed in attachments to the report.

Development 5.14. Ɣ We have adopted the Developer’s estimate of project costs (project budget) costs within our assessment.

Ɣ There are severe limitations on the accuracy of build costs applied by this approach and professional advice on the build costs should be sought by you. The reliance which can be placed upon our advice in these circumstances is severely restricted. If you subsequently obtain specialist build cost advice, we recommend that we are instructed to review our advice.

Financing and 5.15. We’ve applied discount rate for the calculations using the Residual Method discount rate (generally, for Residential Properties).

Despite the general shortage of construction financing in Russia – in particular financing provided by Western banks – we have assumed in this particular case a 100% equity financing at an interest rate specified for every Property within its description in the attachment. This interest rate was derived on the basis of the government bonds yield (OFZ-46020-AD, maturity date – February 06, 2036, yield to maturity – 7.84%)7 and a margin of approximately 6.49% to 13.52%.

The average nominal discount rate of 17.45% is within the range of discount rate of 15%-22% proposed by Association of Banks of the North-West Russia8.

Thus, we are of opinion that the average nominal discount rate of 17.45% applied for discounting the cash flow in the DCF Method used in undertaking our valuation of the residential properties within the portfolio is adequate to the market data.

Capitalization 5.16. We have applied a capitalization rate (all-risk yield) of 10.5% to 11% for the rate Properties located in Moscow and of 10% to 11% for the Properties located in St. Petersburg as explained in paragraph 4.8.

Calculation 5.17. This valuation does not reflect purchaser’s costs, which we would anticipate to be approximately 1.5–2% of the property value, including legal and tax advisers’ fees. The Value provided doesn’t include these fees.

The valuation calculations are attached as the Excel files in the electronic form.

Valuation bases Market Value 5.18. Market Value is defined within RICS Valuation – Professional Standards as:

The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.

Fair Value 5.19. Fair Value for financial reporting is defined within RICS Valuation – Professional Standards / International Valuation Standards , adopting the definition of the International Accounting Standards Board (IASB) in IFRS 13, as:

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Portfolios 5.20. In a valuation of a property portfolio, we have valued the individual properties separately and we have assumed that the individual properties have been marketed

7 http://www.rusbonds.ru/quotes.asp?go=1&tool=%CE%D4%C7-46020- %C0%C4&emit=0&sec=1&status=&cat=0&per=0&rate=0&ctype=0&pvt=0&grnt=0&conv=0&amm=0&mp=10013&dtd=29&dtm=12&d ty=2014&bdate=&edate=&byeff=&eyeff=&bvol=&evol=&bsdvol=&esdvol=&btrade=&etrade=

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in an orderly way.

Valuation date Valuation date 5.21. The valuation date is December 31, 2017.

Market Value Assumptions 5.22. Our valuation is necessarily based on a number of assumptions which have been drawn to your attention in our Agreement ȶ PO-36/2017 dated December 15, 2017, General Terms of Business, Terms of Engagement Letter and within this report.

Key assumptions 5.23. Whilst we have not provided a summary of all these assumptions here, we would in particular draw your attention to a key assumption that state assumptions which are particularly important / relevant as instructed by you so drawn to your attention within this report:

Ɣ The Subject Property is represented by vacant, partly or completely developed land plots intended for residential (residential premises) and commercial (apartments) development (hereinafter referred to as Residential Properties) and by commercial office buildings with related land plots (hereinafter referred to as Commercial Properties). It is assumed that the buildings under construction will be completed in accordance with the identified plans and specification provided by the Client.

Ɣ The owners of the Properties within the portfolio are several legal entities. We have been informed by the Client that all these legal entities are parts of LSR Group OJSC. Thus we assume that 100% ownership of LSR Group OJSC is to be valued.

Ɣ To the title documents provided by the Client part of the Properties are either the shared ownership or leasehold. For the shared ownership we assume it is the share of freehold tenure of the Client in all the properties to be assessed. For leasehold property we assume it is freehold tenure of the improvements and leasehold of the land to be assessed.

Ɣ We assume that all the utilities (heating, cold and hot water, electricity, sewerage / drainage and telecommunications) are available to the Property at the site borders.

Ɣ We assume that public and social (including school) facilities for the future

development are sufficient.

Ɣ We have adopted the Developer’s estimate of project costs (project budget) within our assessment.

Ɣ Residential Properties. Sales proceeds provided by the Client consist of anticipated income from already sold but unpaid units and estimated income from the unsold units. In our DCF calculations we have adopted only estimated income from the unsold units. We have assumed that a hypothetic potential purchaser of the Property would normally be entitled to all the Property rights including claim rights for the payment for sold unpaid units. Thus, we have added anticipated income from already sold but unpaid units to the NPV.

Ɣ We have assumed construction period in accordance with the Developer’s envisaged timetable when in our opinion this timetable complied with construction periods witnessed at developments of a comparable scale Otherwise our knowledge of similar developments suggested a construction period allowance of approximately 1 year (per phase if applicable).

Ɣ Residential Properties. We have assumed construction phasing in accordance with the Client’s envisaged phasing. In the absence of construction phasing information provided by the Client, we have adopted the most probable market construction phasing. We have assumed 100,000 – 200,000 sq. m of buildings constructed within 1 phase.

Ɣ To the Terms of Engagement the valuation of portfolio should be presented in the format of the report. Market researches, competitors analyses and description of the Properties within the Portfolio are placed in the attachments to the report.

considered to reflect any changes in inputs after the valuation date.

Market Value 5.24. We are of the opinion that the Market Value of the Properties within the portfolio at the valuation date is (rounded):

185,465,550,000 (One Hundred Eighty Five Billion Four Hundred Sixty Five Million Five Hundred Fifty Thousand) RUB.

Table 3. Market Value of the Properties within the portfolio

LSR share, Market Value of 100% ownership, incl. income from deals before No Development Project Address % RUB, incl. VAT December 31, 2017, RUB, incl. VAT

Saint-Petersburg and

Leningradskaya Oblast' Business centers Lit ǩ, 36, Kazanskaya 1 Kazanskaya 36 100% 711,014,438 St, St.Petersburg 44, Kazanskaya St, 2 Zolotaya Kazanskaya 100% 326,839,416 St.Petersburg Lit A, 39, Kirochnaya 3 Paradny Kvartal BC 11 100% 497,173,926 St, St.Petersburg Lit A, 18, Fonarny 4 Kazanskaya 60 100% 235,283,863 Lane, St.Petersburg TOTAL, business centers 1,770,311,643 Elite (A) class residential

properties Lit A, 4, Smolnogo St, 5 Smolny Park 100% 3,425,273,341 860,558,888 St.Petersburg Phase 2, bldgs. Ǩ2,5,6 1,144,050,260 74,163,302 Phase 3 1,071,475,291 62,359,656 Phase 4 1,209,747,789 724,035,930 Lit M, 39, Radishcheva 6 Radishcheva, 39 100% 110,718,960 66,618,652 St, St.Petersburg Lit A, 29, Morskoy Pr, 7 Verona 100% 1,767,396,362 418,515,137 St.Petersburg Neva Art, Neva Residence 17, Remeslennaya St., 8 100% 7,665,504,732 (REB Flota) St.Petersburg 9 Neva Haus Bavaria 9,11, Petrovskiy Pr. 100% 6,158,317,847 412,395,374 Lit Ǩ, 13, Kuybysheva 10 Dom na Dvoryanskoy 100% 45,440,166 3,417,522 St, St.Petersburg Lit A, 64, Martynova 11 Osobnyak Truvorova 100% 513,000,000 Emb, St.Petersburg 5, Korolenko St, 12 Russkiy Dom 100% 4,501,379,158 1,421,770,987 St.Petersburg TOTAL, elite (A) class 24,187,030,566 residential properties Business (B) class

residential properties Lit ǭ, 10, Medikov Av, 13 Europa City 100% 2,455,116,880 300,942,494 St.Petersburg

LSR share, Market Value of 100% ownership, incl. income from deals before No Development Project Address % RUB, incl. VAT December 31, 2017, RUB, incl. VAT

Phase 3 1,245,504,885 31,089,330 Phase 4 1,209,611,995 269,853,164 Plot 151, Block 66a, 14 Tri Vetra Savushkina St, 100% 3,511,176,080 1,264,206,504 St.Petersburg Lit ǫ, Moskovskoye 15 Moskovskoye Hgwy 100% 1,465,707,458 261,227,811 Hwy, St.Petersburg NEO 715,953,573 261,227,811 Hotel 749,753,885 Nevskaya Guba, plots 16 Morskoy Façade 100% 10,936,431,386 12, 13, 14, 15 3, Lit. ǧ, Ǳ, ǫ, Chernoy 17 Chyornaya Rechka 100% 1,345,872,051 Rechki Emb. 14, Smolenskaya St, 18 Bogemia 100% 1,204,391,537 488,463,727 St.Petersburg TOTAL, business (B) class 20,918,695,392 residential properties Mass market (Ǹ) class

residential properties Block 28, 28a, Doblesti 19 Yuzhnaya Akvatoriya 100% 4,421,248,087 1,869,157,050 St, St.Petersburg Yuzhnaya Aquatoria, plot 531,506,095 9,738,090 13 Yuzhnaya Aquatoria, plot 859,662,484 330,259 14 Yuzhnaya Aquatoria, plot 487,638,507 24 Yuzhnaya Aquatoria, plot 9 769,094,480 458,633,052 Yuzhnaya Aquatoria, plot 1 164,213,413 28,877,970 Yuzhnaya Aquatoria, plot 2 1,180,167,264 1,371,577,680 Yuzhnaya Aquatoria, plot 6 428,965,844 Plots 3, 8, 12, 5, 7, 3*, 13, 8*, 1, Lit ǻ, 49, 6, 20 Sophiya 100% 1,767,340,269 1,020,542,521 Yuzhnoe Hwy, St.Petersburg 12, Marshala Blukhera, 21 Kalina Park 100% 4,032,657,106 1,873,977,723 St.Petersburg Murinskaya Road, 22 Novaya Okhta 100% 5,073,743,771 1,445,154,450 St.Petersburg Ruchyi Tsvetnoy Gorod 145, Piskarevsky Av, 23 100% 7,889,257,080 1,514,761,160 Vostok St.Petersburg Ruchyi Tsvetnoy Gorod 145, Piskarevsky Av, 24 100% 5,118,772,453 Zapad St.Petersburg 145, Piskarevsky Av, 25 Ruchyi-7 100% 1,593,483,695 St.Petersburg Plot 208, Prigorodny 26 Shuvalovsky (Kamenka), 100% 5,040,603,186 2,125,239,382 St.Petersburg Oktyabrskaya 42, Oktyabrskaya Emb, 27 100% 13,150,092,196 2,965,303,498 Naberezhnaya St.Petersburg Oktyabrskaya 6,474,295,871 2,965,303,498 Naberezhnaya Rudas Oktyabrskaya 6,675,796,324 Naberezhnaya Barrikada Plots 14,17, Orlovo- 28 Zapovednaya 100% 1,544,442,729 5,050,142 Denisovskiy Av. Airport Rzhevka, Kovalevo Settlement, 29 Aeroport Rzhevka Vsevolozhsky District, 100% 5,064,741,685 Leningradskaya Oblast' Plots 1,2, Kosmonavtov Pr. Zvezdny Duet 30 (south-east of 100% 1,475,365,685 241,136,522 (Kosmonavtov/Dunayskiy) Svirskaya St crossing), St.Petersburg TOTAL, mass market (Ǹ) class residential 56,171,747,942 properties

LSR share, Market Value of 100% ownership, incl. income from deals before No Development Project Address % RUB, incl. VAT December 31, 2017, RUB, incl. VAT

Commercial properties 1-3, Paradnaya St, 31 Paradny Kvartal 1,422,111,864 St.Petersburg 1, Nevsky Av, 32 Nevsky 1 2,535,847,254 St.Petersburg 68, Nevsky Av / Lit Ǩ, 33 Nevsky 68 40/68, Fontanka River 100% 2,331,820,000 Emb, St.Petersburg TOTAL, commercial 6,289,779,118 properties TOTAL, properties, located in Saint- 109,337,564,661 Petersburg and Leningradskaya Oblast' Moscow and

Moscovskaya Oblast' Business (B) class

residential properties Bldg 19, 21, 34 Donskoy Olimp Serpukhovsky Val St, 100% 2,840,611,964 576,137,752 Moscow Zarechye Settlement, 35 Grunvald Odintsovo District, 100% 246,599,938 5,816,582 Moscovskaya Oblast' Bldg 14, 21, 58 36 Leningradskoe shosse 58 Leningradskoye Hwy, 100% 3,296,400,728 Moscow 23, Avtozavodskaya 37 ZiL Yug 100% 7,317,213,798 St, Moscow 23, Avtozavodskaya 38 Zilart 100% 35,563,900,336 3,667,972,025 St, Moscow TOTAL, business (B) class 49,264,726,764 residential properties Mass market (Ǹ) class

residential properties Bldg 6, 39 (Vzlet) Luchi Proizvodstvennaya St, 100% 9,442,380,660 2,878,777,979 Moscow 26, Krasnogo Mayaka 40 Krasniy Mayak 100% 2,129,399,025 St., Moscow Mikrorayon Zapadny, 41 Novoe Domodedovo Domodedovo, 100% 154,186,901 90,695,118 Moscovskaya Oblast' near Chernaya Village, Pavlo-Slobodskoye 42 Nakhabino Yasnoe Settlement, Istrinsky 100% 1,676,858,881 362,403,249 District, Moscovskaya Oblast' TOTAL, mass market (Ǹ) class residential 13,402,825,465 properties Commercial properties Bldgs. 1, 2, 3, 9, 43 Novy Balchug Sadovnicheskaya St, 100% 2,701,383,263 Moscow TOTAL, commercial 2,701,383,263 properties Business centers 22, Avtozavodskaya 44 Avtozavodskaya 100% 1,164,694,322 St, Moscow 16, Tverskoy Blvd, 45 16, Tverskoy Blvd 100% 1,217,521,967 Moscow 16, Davydkovskaya St, 45 Davydkovskaya 100% 235,113,692 Moscow TOTAL, business centers 2,617,329,981 TOTAL, properties, located in Moscow and 67,986,265,474 Moscovskaya Oblast' Yekaterinburg

LSR share, Market Value of 100% ownership, incl. income from deals before No Development Project Address % RUB, incl. VAT December 31, 2017, RUB, incl. VAT

Mass market (Ǹ) class

residential properties 2B, 40-Letiya 47 Rassvetny Komsomola St, 100% 330,441,604 286,005,028 Yekaterinburg Latviyskaya St, 48 Khrustalniye Klyuchi 100% 562,208,335 126,121,179 Yekaterinburg Sukhodolskaya St, 49 Michurinsky 100% 1,054,929,121 226,352,594 Yekaterinburg Rastochnaya St, 50 Rastochnaya 100% 325,322,471 83,616,280 Yekaterinburg Verkhneuphaleyskaya 51 Akademichesky 100% 578,852,606 220,780,063 St, Yekaterinburg Flagman (Repina- Repina St, 52 100% 1,068,987,526 447,728,729 Zavodskaya) Yekaterinburg 53 VIZ Bol`shoy Konnyy 95% 940,774,680 54 Tsvetnoy Bulvar Bl'ukhera 100% 879,246,825 97,538,276 11, Shefskaya St, 55 Shefskaya 11 100% 206,712,287 42,811,781 Yekaterinburg 25, 40-Letiya 56 Voskhod Komsomola St, 100% 307,294,421 Yekaterinburg TOTAL, properties, 6,254,769,875 located in Yekaterinburg Germany 57 Leipzig 100% 1,308,469,200 58 Landshut 100% 96,413,520 59 Munich 100% 482,067,600 TOTAL, properties, 1,886,950,320 located in Germany TOTAL, properties 185,465,550,329

6. Property risk analysis

General comments 6.1. In this section of our report we summarise the property related risks which we have identified as part of our valuation report and which we consider should be drawn to your attention. This summary should not be taken to be exhaustive and must be considered in conjunction with the remainder of the report. Nothing in this section should be construed as being a recommendation of taking any particular course of action.

Risks relating to the property Location 6.2. We assume a high level attraction of the location of Properties within the portfolio for future tenants and customers.

Contamination 6.3. While carrying out our valuation inspection, we have not been made aware of any uses conducted at the subject property that would give cause for concern as to possible environmental contamination. Our valuation is provided on the assumption that the property is unaffected.

For the purposes of valuation we referred to the design parameters for the construction according to the Properties development, provided by the Client. We

consider these parameters especially for residential construction satisfy sanitary requirements.

Nevertheless in our opinion the absence of the existing sanitary protection zone requires further investigation.

Planning 6.4. We have been informed by the Client that the Property is intended for residential and commercial development.

We assume that all necessary permissions for the scheme described in this report will be obtained and that this scheme will be completed, in order to arrive at our opinion of the Market Value of the Property.

We recommend that our assumption on the proposed development scheme adoption was referred to the appropriate legal and planning advisers.

Legal title 6.5. Any legal title issues are matters which should be referred to your legal advisers. However the following matters have come to our attention which we consider require further investigation

We have been provided with the Properties’ title information by the Client. Nevertheless we have not been provided with all the ownership certificates and land long-term lease agreements to verify it. Thus, in our valuation, we have assumed a good and marketable freehold (to the land plots and buildings) or long-term leasehold (to the land plots) title and that all documentation is satisfactorily drawn.

We recommend that our assumption on the good and marketable title was referred to the appropriate legal advisers.

Tenancies 6.6. Any tenancy issues are matters which should be referred to your legal advisors. However the following matters have come to our attention which we consider require further investigation.

Commercial Properties. As some commercial office Properties and business centres within the portfolio are multi-tenanted i.e. occupied by the owner and other tenants we have valued it on the assumption of vacant possession after the lease expires.

We have been provided with the tenancy information by the Client and have relied on that information as being correct. If the contract does not specify the expiration date we assumed the contract shall expire with one year after the valuation date. No additional verification has been undertaken.

We recommend that our understanding of the expiration date of the current lease agreements is referred to your legal advisers. Should this be subject to any amendment our valuation should be reviewed.

Income risks Tenant covenant 6.7. Due to the quality of the future building we estimate high quality of tenants and buyers interested in renting and living space in the Subject Property.

Cashflow 6.8. Residential Properties. The apartments and residential premises are or will be put on sale at the early stage of construction that would guarantee stable cash flow. The pace of sales and prices for the discounted cash flow calculations are in line with market. Nevertheless in current market conditions there is a higher than normal degree of uncertainty attached to our opinion of the stability of cash flows.

Commercial Properties. Some commercial office Properties and business centres within the portfolio are multi-tenanted i.e. occupied by the owner and other tenants. Most of the contracts do not specify the expiration date thus we assumed the contract shall expire with one year after the valuation date.

The necessity of new tenants searching may result in cash flows. Nevertheless taking into account that most of the commercial office Properties and business centres within the portfolio are owner occupied and intended for further owner occupation and not for income gaining and will continue to remain in the existing ownership or occupation uncertainty attached to our opinion of the stability of cash flows is not so significant.

Reletting 6.9. Commercial Properties. As the commercial office Properties and business centres within the portfolio will continue to remain in the existing ownership or occupation the risk of reletting the premises might be low.

Void costs 6.10. As a result of stable cash flow and low reletting uncertainty the void costs tend to decrease which also means lower expenses for agent’s rewarding.

Development risks Construction 6.11. Capital expenditures are to be incurred in course of the actual project development – costs construction of utilities and buildings. The scope of estimating both the parameters of future development and the construction and other costs is beyond the scope of our expertise. We recommend that our understanding of the parameters of future development is referred to a project surveyor for confirmation that our understanding is correct. We recommend that our understanding of the development costs is referred to a quantity surveyor for confirmation that our understanding is correct. Should this be subject to material amendment our valuation should be reviewed.

Cost over-runs 6.12. The development scheme described in this report is not unusual type of construction. Nevertheless we would like to draw your attention to the fact that in current market conditions the construction of buildings especially within the integrated development of the territory or any contingencies related to environmental, planning and site conditions may cause additional costs difficult to pin down in advance. Thus we recommend that the construction costs should be carefully reviewed by a quantity surveyor after the building project approval and building permit obtaining.

Time over-runs 6.13. Consequential losses may arise if the development over-runs and the construction term increases. Thus we recommend that the construction costs should be carefully reviewed by a quantity surveyor after the building project approval and building permit obtaining.

Design concerns 6.14. The development scheme of the Properties within the portfolio described in this report is highest and best use of the Property at the valuation date. Thus we recommend that our assumption on the proposed development scheme adoption was referred to the appropriate legal and planning advisers. Any alteration to the proposed scheme may cause the failure to maximising value.

Discount and 6.15. Appraisal is based on the current market discount and capitalization rates based capitalization frequently on estimations and expert opinions of capital markets specialists due to rate increases the fact that the buildings sales market is not transparent. We draw to your attention that in the current economic climate there is a higher than normal degree of uncertainty attached to our opinion of discount and capitalization rates at the date of valuation.

Sales rate 6.16. Sales rates assumed are in line with the market data. (market Commercial Properties. For the commercial office Properties and business centres absorption) within the portfolio intended for remaining in the existing ownership and mostly owner occupation Comparative Method is the most appropriate. Due to the lack of evidence of comparable sales transactions we made our assessment only on the basis of a collation and analysis of appropriate comparable negotiations. Nevertheless the discounts applied to the asking price are in line with the market.

Profitability of 6.17. Scheme generates a property value if average profit level in the current market scheme adopted.

Cancellation of 6.18. The scheme is in line with the market data and doesn’t assume a high level of off-plan off-plan sales or sales. Pre-lets are not assumed. pre-lets

Movement in 6.19. We highlight that our opinion of value is only current at the valuation date. This is inputs after particularly important in current market conditions and subsequent re-valuation(s) valuation date may need to be considered to reflect any changes in inputs after the valuation date.

Economic & property market risks Market 6.20. We refer to the RICS Valuation – Professional Standards, Guidance Note 1 (Valuation uncertainty Certainty). Our opinion of value represents our professional view based upon any available market evidence and our professional judgement. In the current market, there is a general lack of market evidence. The lack of market evidence means that the speed with which values are moving is very difficult to assess. As a result, we need to place a high degree of reliance upon our professional judgement in arriving at our opinion of value.

As for commercial real estate investor sentiment towards property investment has weakened considerably over the past months. Far fewer negotiations are resulting in transactions as many investors wait to see how market pricing will ultimately adjust to changing economic and restrictive credit conditions. In consequence, there is a limited number of comparable transactions. You should note that our opinion of Market Value is provided in light of these conditions. Accordingly, given the current economic and property market volatility, we recommend that the valuation is kept under regular review.

We draw to your attention that in the current economic climate there is a higher than normal degree of uncertainty attached to our opinion of value at the date of valuation. We also highlight that our opinion of value is only current at the valuation date. This is particularly important in current market conditions and subsequent re- valuation(s) may need to be considered to reflect any changes in value after the valuation date.

The further impact of the changing economic and restrictive credit conditions on the Russian economy is currently unclear.

Macro 6.21. Macro risks refer to types of economic factors which influence the volatility over time economic/ of investments and the value of properties. The further significant changes in the political risks interest rates, inflation or exchange rate may cause changes in value after the valuation date. We draw to your attention that our opinion of value is only current at the valuation date.

Demand from 6.22. Residential Properties. The market showed high buying activity relating to the owners / residential (residential premises or flats) and commercial (apartments) properties. occupiers Commercial Properties. Commercial real estate investor sentiment towards property investment has weakened considerably over the past year. Volatility in rental income caused by the rental rates reduction and the tenants’ desire to revise tenancy terms create a barrier to market entry for potential investors seeking stabilized assets. Far fewer negotiations are resulting in transactions as many investors wait to see how market pricing will ultimately adjust to changing economic and restrictive credit conditions. The market of the properties acquired for owner occupation is almost completely intransparent. Thus there is a general lack of market evidence.

Supply of similar 6.23. Commercial Properties. The average weighted vacancy rate of similar properties in the properties area (the existing direct and indirect competitors in the zone of influence) is not high and doesn’t exceed 15%.

The vacancy rates of the Properties within the portfolio (except 2 buildings - bldgs. 17, 18, 1-3, Paradnaya St, St Petersburg and 68, Nevsky Av, St Petersburg) are low or absent at all. This fact corresponds with the market data and forecast as of the valuation date.

Availability of 6.24. The shortage of bank financing, especially for investment and from Western banks, is finance now felt in the current real estate market.

Liquidity of the 6.25. Residential Properties. The Properties may take unusually long time to sell butit property type / normally will continue to remain partially in the existing ownership or occupation up to Time to sell the completion of the costruction and selling of the units (flats, apartments, built-in premises and car-parking spaces with related land plots).

Commercial Properties. The Properties would take unusually long time to sell but it normally will continue to remain in the existing ownership or occupation.

Valuation risks Methodology 6.26. You need to be aware that the residual method requires the input of a large amount of data, which are rarely absolute or precise, together with making of a large number of assumptions. Small changes in any of the inputs can cumulatively lead to a large change in the site value. Some of the inputs can be assessed with reasonable objectivity, but others require a high degree of professional judgement.

Quality / 6.27. The real estate market in Russia is very opaque. Information on our provided sales quantity of and lease comparables is based on published information and internal marketing comparables researches of Knight Frank Research Departments.

Signature

Svetlana Shalaeva Konstantin Fomin RICS Registered Valuer Head of Valuation, Director, Key Client Manager St Petersburg

Galiya Chelysheva Dmitry Tsatskin

Project Manager Project Manager

For and on behalf of Knight Frank St Petersburg AO

Appendix 1 Terms of Engagement/ General Terms of Business for Russian Valuations

LSR Group OJSC

St. Petersburg

Russia

December 15, 2017

Dear Sir/Madam

Our Terms of Engagement for a Valuation of the property, located in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, and Yekaterinburg, Russia

We are writing to set out our Terms of Engagement for carrying out a valuation of the above property.

Our Terms of Engagement for this instruction comprise our General Terms of Business for Valuations which are attached to this letter, together with the specific terms contained within this letter. This letter shall take precedence, to the extent that there is any inconsistency with the General Terms of Business for Valuations. A copy of this letter and our General Terms of Business for Valuations are attached for you to sign and return to us, signifying your acceptance of the terms.

In addition to our General Terms of Business for Valuations, our Terms of Engagement for carrying out this instruction are as follows:

Our Client

Our client for this instruction is LSR Group OJSC.

Fees

Our fee for undertaking this instruction is set in Agreement PO-36/2017 dated December 15, 2017.

Conflicts of interest

We confirm that we do not have any material connection or involvement giving rise to a conflict of interest and are in a position to provide an objective and unbiased valuation.

Limitation of liability and restrictions on use

Clause 3 of our General Terms of Business for Valuations limits our liability under this instruction.

Third party liability

Additionally, as stated in Clause 3.1 of our General Terms of Business for Valuations, no liability is accepted to any third party for the whole or any part of the valuation report.

Disclosure

The valuation report is confidential to the Client.

Valuation standards

The valuation will be undertaken in accordance with the Royal Institution of Chartered Surveyors (RICS) Valuation - Professional Standards June 2017 Global & UK edition (the Red Book) including the International Valuation Standards (2017)

Status of valuer

External valuers, as defined in the Red Book.

Valuer and Competence Disclosure

The valuer, on behalf of Knight Frank St Petersburg AO with the responsibility for this report is

Ɣ Svetlana Shalaeva MRICS, RICS Registered Valuer, Head of Valuation Department, Knight Frank St Petersburg AO;

Parts of this valuation will be undertaken by additional valuers. We confirm that the valuer and the additional valuers meet the requirements of the Red Book, having sufficient current knowledge of the particular market and the skills and understanding to undertake the valuation competently.

Purpose of valuation

The valuation is required for the purposes of publication on the Clients’ website, providing it to the Ǹlient's counterparties, attraction of investors and for the preparation of financial statements in accordance with International Financial Reporting Standards for the year 2017.

Property to be valued

The list of the property to be valued (the Portfolio) is presented in the Appendix 1 to the Agreement No. PO-36/2017 dated December 15, 2017 (hereinafter the Agreement).

Interest to be valued

Freehold/ leasehold.

Property type and use

Vacant, partly or completely developed land plots intended for residential and commercial development; commercial office buildings with related land plots.

Basis of valuation

As defined in the RICS Red Book, our valuation will be undertaken on the following bases: x Market Value.

Special Assumptions and Assumptions

Our valuation will necessarily be based upon a number of assumptions, as set out in the General Terms of Business for Valuations, this letter and within our valuation report.

Valuation date

December 31, 2017.

Currency to be adopted

Russian ruble (RUB).

Extent of inspection and investigations

Our General Terms of Business set out the scope of our on-site inspection and investigations.

Unless prevented from doing so, we will inspect the properties internally. For properties to which access cannot be gained the valuation will be on a drive by basis.

You should note that this significantly limits the extent to which reliance can be placed upon our valuation report.

Information to be relied upon

In the following a list of Required Information that we need in order to undertake our valuation is set out:

x Information relating to the extent of the property, produced by special services of public authorities Title documents (ownership certificates and lease agreements);

x Information relating to the proposed development scheme, produced by the Client;

x Information relating to the planning status of the Property, from the Client;

x Information relating to the construction costs, terms of project realization of the proposed development as produced by the Client;

x Information relating to the sales prices of the proposed development as produced by the Client.

This information will be relied upon by us in our final valuation report, subject only to any verification that we have agreed to undertake.

Where we express an opinion of legal issues, any such opinion must be verified by your legal advisors before the valuation can be relied upon or published.

Report format

Our valuation report will be prepared in our standard format which will be compliant with VPS 3 of the Red Book. Market researches, competitors’ analyses, and description of the Properties within the Portfolio will be placed in attachments to the report.

If any of the details set out above are incorrect please let us know – we will assume they are correct unless you tell us otherwise.

Please will you sign and return the duplicate copy of this Terms of Engagement letter, signifying your agreement to the terms contained therein. We should point out that the report will not be discussed or disclosed before these Terms have been returned.

Thank you for instructing Knight Frank St Petersburg AO.

Yours faithfully

Svetlana Shalaeva RICS Registered Valuer Head of Valuation Knight Frank St Petersburg AO [email protected]

Enclosed: General Terms of Business for Russian Valuations

………………………………………………….. …………….

Signed for and on behalf of LSR Group OJSC Date

General Terms of Business for Russian Valuations

These General Terms of Business comprise a part of our Terms of Engagement. The following General Terms of Business apply to all valuations and appraisals undertaken by Knight Frank Saint-Petersburg AO unless specifically agreed otherwise in confirming instructions and so stated within the main body of the valuation report.

1. Knight Frank St Petersburg

Knight Frank Saint-Petersburg AO,

Liter A, 3B, Mayakovskogo St., St Petersburg, 191025, Russia

2. Jurisdiction

Russian law shall apply in every respect in relation to the valuation and the agreement with the client which shall be deemed to have been made in Russia (the Agreement). In the event of a dispute arising in connection with a valuation, unless expressly agreed otherwise in writing by Knight Frank Saint-Petersburg AO, the client, and any third party using the valuation, will submit to the jurisdiction of the Russian Courts only. This will apply wherever the property or the client is located or the advice is provided.

3. Limitations on Liability

3.1. Our valuation is confidential to the party to whom it is addressed for the stated purpose and no liability is accepted to any third party for the whole or any part of its contents. Liability will not subsequently be extended to any other party save on the basis of written and agreed instructions; this may incur an additional fee. Except as set out in 3.2 below the terms of the Agreement between Knight Frank Saint-Petersburg AO and the client are not enforceable by any third party.

3.2. No claim arising out of or in connection with the Agreement may be brought against any member, employee, partner or consultant of Knight Frank Saint-Petersburg AO (each called a ‘Knight Frank Person’). Those individuals will not have a personal duty of care to the client or any other party and any such claim for losses must be brought against Knight Frank Saint-Petersburg AO.

3.3. Our maximum total liability for any direct loss or damage whether caused by our negligence or breach of contract or otherwise is limited to Knight Frank Saint-Petersburg AO’s fee under the instruction set out in the Terms of Engagement letter and the Agreement which will be sent to the client.

3.4. We do not accept liability for any indirect or consequential loss (such as loss of profits). Nothing in these Terms of Business (or in our Terms of Engagement letter) shall exclude or limit our liability in respect of fraud or for death or personal injury caused by our negligence or for any other liability to the extent that such liability may not be excluded or limited as a matter of law.

4. Severance

If any provision of the Agreement is or becomes invalid, illegal or unenforceable, it shall be deemed modified to the minimum extent necessary to make it valid, legal and enforceable. If such modification is not possible, the relevant provision shall be deemed deleted. Any modification to or deletion of a provision under this clause shall not affect the validity and enforceability of the rest of the Agreement.

If any provision is invalid, illegal or unenforceable, the parties shall negotiate in good faith to amend such provision so that, as amended, it is legal, valid and enforceable and, to the greatest extent possible, achieve the intended commercial result of the original provision.

5. Disclosure and Publication

If our opinion of value is disclosed to persons other than the addressees of our report, the basis of valuation should be stated.

6. Complaints Procedure

If you have any concerns about our service, please raise them in the first instance with the valuer concerned. If this does not result in a satisfactory resolution, please contact the relevant Head of Department. As required by RICS, we will send you a copy of our Complaints Procedure on request.

7. Our Fees

The Fee terms are stipulated in the Agreement.

8. Disclosable Interests

We may offer the following services to prospective purchasers and similarly the services may be offered to them by another organisation in circumstances where we may benefit financially: financial services, property letting and management services, building construction, refurbishment and maintenance services and the sale of the prospective purchaser’s property.

9. RICS Valuation – Professional Standards - The Red Book

Valuations and appraisals will be carried out in accordance with the relevant edition of the RICS Valuation - Professional Standards by valuers who conform to its requirements and with regard to relevant statutes or regulations. Compliance with The Red Book is mandatory for Chartered Surveyors in the interests of maintaining high standards of service and for the protection of clients.

10. Monitoring

The valuation may be subject to monitoring under the RICS conduct and disciplinary regulations.

11. Valuation Basis

Valuations and appraisals are carried out on a basis appropriate to the purpose for which they are intended and in accordance with the relevant definitions, commentary and assumptions contained in The Red Book. The basis of valuation will be agreed with you in the letter covering the specific terms for the instruction.

12. Portfolios

Where requested to value a portfolio, unless specifically agreed with you otherwise, we will value the individual properties separately, upon the assumption that the properties have been marketed in an orderly manner.

13. Land Register Inspection and Searches

We do not undertake searches or inspections of any kind (including web based searches) for title or price paid information in any publicly available land registers.

14. Title and Burdens

We do not read documents of title although, where provided, we consider and take account of matters referred to in solicitor’s reports or certificates of title. We would normally assume, unless specifically informed and stated otherwise, that each property has good and marketable title and that all documentation is satisfactorily drawn and that there are no unusual outgoings, planning proposals, onerous restrictions or local authority intentions which affect the property, nor any material litigation pending.

15. Disposal Costs and Liabilities

No allowance is made in our valuation for expenses of realisation or for taxation which may arise in the event of a disposal and our valuation is expressed as exclusive of any VAT that may become chargeable. Properties are valued disregarding any mortgages or other charges.

16. Sources of Information

We rely upon the information provided to us, by the sources listed, as to details of tenure and tenancies (subject to 'Leases' below), planning consents and other relevant matters, as summarised in our report. We assume that this information is complete and correct.

17. Identity of Property to be Valued

We will exercise reasonable care and skill (but will not have an absolute obligation to you) to ensure that the property, identified by the property address in your instructions, is the property inspected by us and contained within our valuation report. If there is ambiguity as to the property address, or the extent of the property to be valued, this should be drawn to our attention in your instructions or immediately upon receipt of our report.

18. Boundaries

Plans accompanying reports are for identification purposes only and should not be relied upon to define boundaries, title or easements. The extent of the site is outlined in accordance with information given to us and/or our understanding of the boundaries.

19. Planning, Highway and Other Statutory Regulations

Enquiries of the relevant Planning and Highways Authorities in respect of matters affecting the property, where considered appropriate, are normally only obtained verbally or from a Local Authority web site, and this information is given to us, and accepted by us, on the basis that it should not be relied upon. Written enquiries can take several weeks for response and incur charges. Where reassurance is required on planning matters, we recommend that formal written enquiries should be undertaken by the client’s solicitors who should also confirm the position with regard to any legal matters referred to in our report. We assume that properties have been constructed, or are being constructed, and are occupied or used in accordance with the appropriate consents and that there are no outstanding statutory notices.

We assume that the premises comply with all relevant statutory requirements including fire and building regulations.

20. Property Insurance

Our valuation assumes that the property would, in all respects, be insurable against all usual risks including terrorism, flooding and rising water table at normal, commercially acceptable premiums.

21. Building Areas and Age

Where so instructed, areas provided from a quoted source will be relied upon. Where the age of the building is estimated, this is for guidance only.

22. Structural Condition

Building, structural and ground condition surveys are detailed investigations of the building, the structure, technical services and ground and soil conditions undertaken by specialist building surveyors or engineers and fall outside the normal remit of a valuation. Since we will not have carried out any of these investigations, except where separately instructed to do so, we are unable to report that the property is free of any structural fault, rot, infestation or defects of any other nature, including inherent weaknesses due to the use in construction of deleterious materials. We do reflect the contents of any building survey report referred to us or any defects or items of disrepair of which we are advised or which we note during the course of our valuation inspections but otherwise assume properties to be free from defect.

23. Ground Conditions

We assume there to be no unidentified adverse ground or soil conditions and that the load bearing qualities of the sites of each property are sufficient to support the building constructed or to be constructed thereon.

24. Environmental Issues

Investigations into environmental matters would usually be commissioned of suitably qualified environmental specialists by most responsible purchasers of higher value properties or where there was any reason to suspect contamination or a potential

future liability. Furthermore, such investigation would be pursued to the point at which any inherent risk was identified and quantified before a purchase proceeded. Anyone averse to risk is strongly recommended to have a proper environmental investigation undertaken and, besides, a favourable report may be of assistance to any future sale of the property. Where we are provided with the conclusive results of such investigations, on which we are instructed to rely, these will be reflected in our valuations with reference to the source and nature of the enquiries. We would endeavour to point out any obvious indications or occurrences known to us of harmful contamination encountered during the course of our valuation enquiries.

We are not, however, environmental specialists and therefore we do not carry out any scientific investigations of sites or buildings to establish the existence or otherwise of any environmental contamination, nor do we undertake searches of public archives to seek evidence of past activities which might identify potential for contamination. In the absence of appropriate investigations and where there is no apparent reason to suspect potential for contamination, our valuation will be on the assumption that the property is unaffected. Where contamination is suspected or confirmed, but adequate investigation has not been carried out and made available to us, then the valuation will be qualified by reference to appropriate sections of The Red Book.

25. Leases

The client should confirm to us in writing if they require us to read leases. Where we do read leases reliance must not be placed on our interpretation of these documents without reference to solicitors, particularly where purchase or lending against the security of a property is involved.

26. Covenant

We reflect our general appreciation of potential purchasers' likely perceptions of the financial status of tenants. We do not, however, carry out detailed investigations as to the financial standing of the tenants, except where specifically instructed, and assume, unless informed otherwise, that in all cases there are no significant arrears of payment and that they are capable of meeting their obligations under the terms of leases and agreements.

27. Loan Security

Where instructed to comment on the suitability of property as a loan security we are only able to comment on any inherent property risk. Determination of the degree and adequacy of capital and income cover for loans is the responsibility of the lender having regard to the terms of the loan.

28. Build Cost Information

Where our instruction requires us to have regard to build cost information, for example in the valuation of properties with development potential, we strongly recommend that you supply us with build cost and other relevant information prepared by a suitably qualified construction cost professional, such as a quantity surveyor. We do not hold ourselves out to have expertise in assessing build costs and any property valuation advice provided by us will be stated to have been arrived at in reliance upon the build cost information supplied to us by you. In the absence of any build cost information supplied to us, we may have regard to published build cost information. There are severe limitations on the accuracy of build costs applied by this approach and professional advice on the build costs should be sought by you. The reliance which can be placed upon our advice in these circumstances is severely restricted. If you subsequently obtain specialist build cost advice, we recommend that we are instructed to review our advice.

29. Reinstatement Assessments

A reinstatement assessment for insurance purposes is a specialist service and we recommend that separate instructions are issued for this specific purpose. If advice is required as a check against the adequacy of existing cover this should be specified as part of the initial instruction. Any indication given is provided only for guidance and must not be relied upon as the basis for

insurance cover. Our reinstatement assessment should be compared with the owner’s and if there is a material difference, then a full reinstatement valuation should be considered.

30. Comparable Evidence

Where comparable evidence information is included in our report, this information is often based upon our oral enquiries and its accuracy cannot always be assured, or may be subject to undertakings as to confidentiality. However, such information would only be referred to where we had reason to believe its general accuracy or where it was in accordance with expectation. In addition, we have not inspected comparable properties.

31. Regulated Purpose Valuations (RPV)

RICS has established particular requirements in circumstances where a valuation although provided for a client may also be of use to third parties, for instance, the shareholders in a company, defined by the RICS as Regulated Purpose Valuations.

When instructed in a continuing role as a Valuer it is Knight Frank Saint-Petersburg AO’s policy to rotate persons responsible for valuations and the signatory to the report, on a seven yearly basis, unless specifically agreed otherwise.

Valuation Bases Market value (MV):

Valuations based on Market Value shall adopt the definition, and the conceptual framework, settled by the International Valuation Standards Committee.

Market Value is defined as:

Market rent (MR):

Market Rent is defined as:

The estimated amount for which a property would be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.

Projected Market Value (PMV) of Residential Property only

Projected Market Value is designed to provide residential mortgage lenders with a simple numeric indication of the valuer’s opinion of short-term market trends and is defined as:

The estimated amount for which a property is expected to exchange at a date, after the valuation date and specified by the valuer, between a willing buyer and a willing seller, in an arm’s-length transaction, after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.

Regulated Purpose Valuations (RPV) RICS has established particular requirements in circumstances where a valuation although provided for a client may also be of use to third parties, for instance, the shareholders in a company, defined by the RICS as Regulated Purpose Valuations. Where

a valuation is for a Regulated Purpose, in accordance with RICS requirements, Knight Frank St Petersburg AO shall state the following in its report:

(a) The length of time the valuer has continuously been the signatory to valuations provided to the client for the same purpose as the Report, together with the length of time Knight Frank St Petersburg AO has continuously been carrying out the valuation instruction for the client.

(b) The extent and duration of the relationship of Knight Frank St Petersburg AO with the client.

(c) In relation to Knight Frank AO’s preceding financial year the proportion of the total fees, if any, payable by the client to the total fee income of Knight Frank St Petersburg AO expressed as one of the following:

Less than 5% ; or

If more than 5%, an indication of the proportion within a range of 5 percentage points.

(d) Where, since the end of the last financial year, it is anticipated that there will be a material increase in the proportion of the fees payable, or likely to be payable, then we shall include a further statement to that effect in addition to (c) above.

When instructed in a continuing role as a Valuer it is Knight Frank AO’s policy to rotate persons responsible for valuations and the signatory to the report, on a seven yearly basis, unless specifically agreed otherwise.

Appendix 2 Description of the Properties

1. Kazanskaya 36

Property type Operating office

Address Litera Ǩ, 36, Kazanskaya St., St Petersburg

Location

The Property is located in Admiralteysky District of St Petersburg within 10-minute walk from Sadovaya, Spasskaya and Sennaya Ploschad metro stations, convenient transport available. The following landmarks are situated in close proximity to the Property: Palace Square, Hermitage Museum, Senatskaya Square, St. Kazan Cathedral, Kazanskaya Square, Nikolskaya Square, Teatralnaya Square and etc. The variety of restaurants, bars, boutiques and stores are located on Nevsky Ave. Bolshoy Gostiny Dvor Shopping Centre is located within a 20-minute walk of the Property.

Image 1 Image 2 Description The Property comprises an office scheme building around a square courtyard with vehicular access via the front facade. The five- to eight- floor scheme retains its historic facade and provides partitioned class ǩ office accommodation with completed finishing. There is internal parking for 6 parking spaces in the five-floor section. 15 open-air parking spaces are provided in the internal yard.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total building area –7,434 sqm; Ɣ GLA – 4,937 sqm (GLA Ratio – 66% of the total area); Ɣ Land plot – 0.25 hectares (2,526.4 sqm)

Tenure Ɣ Buildings – freehold (ownership certificates 78-ǧǮ 359967 dated June 10, 2014; 78-ǧǮ 359968 dated June 10, 2014; 78-ǧǮ 359971 dated June 10, 2014)

Ɣ Land plot – freehold (ownership certificate 78-ǧǮ 359969 dated June 10, 78-ǧǮ 359970 dated June 10)

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Terms and Reversion Method and Comparative Method were applied. considerations Terms and Reversion Method considerations: Average rental rate (Terms /Reversion period), rubles per sqm p.a.: 11,611/20,879; Average OpEx, rubles per sqm p.a.: 4,236 Caprate (Terms /Reversion period): 10%/10.75%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 711,014,000 RUB

2. Zolotaya Kazanskaya

Property type Operating office

Address 44, Kazanskaya St., St Petersburg

Location

The Property is located in Admiralteysky District of St Petersburg within 15-minutes walk from Sadovaya, Spasskaya and Sennaya Ploschad metro stations, convenient transport access available. The following landmarks are situated in close proximity to the Property: Palace Square, Hermitage Museum, Senatskaya Square, St. Kazan Cathedral, Kazanskaya Square, Nikolskaya Square, Teatralnaya Square and etc. The variety of restaurants, bars, boutiques and stores are located on Nevsky Ave. Bolshoy Gostiny Dvor Shopping Centre is located within a 20-minute walk of the Property.

Image 3 Image 4 Description The Property comprises an office scheme building around a square courtyard with vehicular access via the front facade. The five-floor scheme retains its historic facade and provides partitioned class ǩ office accommodation fully fitted out. There is a parking for 10 cars in the internal yard.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total building area –3,059.3 sqm; Ɣ GLA – 2,707.5 sqm (GLA Ratio – 89% of the total area); Ɣ Land plot – 0.15 hectares (1,475 sqm)

Tenure Ɣ Buildings – freehold (ownership certificates 78-ǧǮ 055289 dated September 4, 2013; 78-ǧǮ 055287 dated September 4, 2013; 78-ǧǮ 055283 dated September 4, 2013; 78-ǧǮ 055408 dated September 4, 2013; 78-ǧǮ 055403 dated September 4, 2013; 78-ǧǮ 055401 dated September 4, 2013; 78-ǧǮ 055290 dated September 4, 2013; 78-ǧǮ 055288 dated September 4, 2013; 78-ǧǮ 055404 dated September 4, 2013; 78-ǧǮ 055285 dated September 4, 2013; 78- ǧǮ 055282 dated September 4, 2013; 78-ǧǮ 055284 dated September 4, 2013; 78-ǧǮ 055281 dated September 4, 2013; 78-ǧǮ 055410 dated September 4, 2013; 78-ǧǮ 055409 dated September 4, 2013; 78-ǧǮ 055402 dated September 4, 2013; 78-ǧǮ 055405 dated September 4, 2013; 78-ǧǮ 055496 dated September 4, 2013; 78-ǧǮ 055406 dated September 4, 2013; 78- ǧǮ 055721 dated September 4, 2013; 78-ǧǮ 055560 dated September 4, 2013; 78-ǧǮ 112236 dated September 4, 2013; 78-ǧǮ 055658 dated September 4, 2013; 78-ǧǮ 055297 dated September 4, 2013; 78-ǧǮ 112238 dated September 4, 2013; 78-ǧǮ 112237 dated September 4, 2013; 78-ǧǮ 055659 dated September 4, 2013; 78-ǧǮ 112235 dated September 4, 2013; 78- ǧǮ 055657 dated September 4, 2013; 78-ǧǮ 479049 dated September 2, 2014; 78-ǧǮ 479995 dated September 4, 2014)

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Terms and Reversion Method and Comparative Method were applied. considerations Terms and Reversion Method considerations: Average rental rate (Terms /Reversion period), rubles per sqm p.a.: 12,255/17,008; Average OpEx, rubles per sqm p.a.: 1,737 Caprate (Terms /Reversion period): 10%/10.75%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 326,839,000 RUB

3. Paradny Kvartal BC 11

Property type Operating office

Address liter A, 39, Kirochnaya St, St Petersburg

Location

The office center is located in Central District of St Petersburg, it takes 10 minutes to walk from Chernyshevskaya metro station. The access to the Property is provides from Paradnaya St. or Kirochnaya St. The proximity of main thoroughfares such as Suvorovskiy Ave, Nevsky Ave, Ligovsky Ave, Voskresenskaya and Smolnaya Embankments provides easy access the Property from various parts of the city. The following landmarks are situated in the surroundings of the Property: Tavrichesky Garden and Palace, Smolny Cathedral, Suvorov Museum. Paradny Kvatal is a mixed-use complex. It is implied the residents will access the diverse infrastructure of this residential complex consisting of stores, supermarkets, educational facilities and a fitness center nearby.

Image 5 Image 6 Description At the valuation date the Property comprises the office complex (3 floors above ground and 1 underground) with a preserved historic facade. The building was built in 1802-1805 years and after reconstruction in 2010 became a part of Paradny Kvartal mixed-used complex. At the valuation date the Property is used by the owner (LSR group). The construction scheme, the floor

layouts and the finishing of the Property matches standards of A-class business center.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total building area –3,717.8 sqm; Ɣ GLA – 2,885.8 sqm (GLA Ratio – 78% of the total area); Ɣ Parking lots/area – 12/416.9 sqm; Ɣ Land plot – 9.57 hectares (the part of the land plot related to the Property is not isolated)

Tenure Ɣ Building – freehold (ownership certificates 78-ǧǭ 837255 dated February 8, 2013; 78-ǧǭ 837256 dated February 8, 2013; 78-ǧǭ 837257 dated February 8, 2013; 78-ǧǭ 837258 dated February 8, 2013; 78-ǧǭ 837259 dated February 8, 2013; 78-ǧǭ 837380 dated February 8, 2013; 78-ǧǭ 837381 dated February 8, 2013; 78-ǧǭ 837382 dated February 8, 2013; 78-ǧǭ 837383 dated February 8, 2013; 78-ǧǭ 837384 dated February 8, 2013; 78-ǧǭ 837385 dated February 8, 2013; 78-ǧǭ 837400 dated February 8, 2013; 78-ǧǭ 837386 dated February 8, 2013; 78-ǧǭ 837387 dated February 8, 2013; 78-ǧǭ 837388 dated February 8, 2013; 78-ǧǭ 837389 dated February 8, 2013; 78-ǧǭ 837390 dated February 8, 2013; 78-ǧǭ 837391 dated February 8, 2013; 78-ǧǭ 837392 dated February 8, 2013; 78-ǧǭ 837393 dated February 8, 2013; 78-ǧǭ 837394 dated February 8, 2013; 78-ǧǭ 837395 dated February 8, 2013; 78-ǧǭ 837396 dated February 8, 2013; 78-ǧǭ 837397 dated February 8, 2013; 78-ǧǭ 837399 dated February 8, 2013)

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Terms and Reversion Method and Comparative Method were applied. considerations Terms and Reversion Method considerations: Average rental rate (Terms /Reversion period), rubles per sqm p.a.: 11,021/20,633; Average OpEx, rubles per sqm p.a.: 5,271 Caprate (Terms /Reversion period): 10%/10.75%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 497,174,000 RUB

4. Kazanskaya 60

Property type Operating office

Address liter A, 18, Fonarny lane, St Petersburg

Location

The Property is located in Admiralteysky District of St Petersburg within a 10-minute walk from Sadovaya/Spasskaya/Sennaya Ploschad metro stations. The entrance to the office center is available from Kazanskaya St. The Property is easily accessible from the main thoroughfares of the district such as Nevsky Ave, Sadovaya St. and Fontanka River Embankment. The main landmarks of the city are situated in the neighbourhood of the Property: Hermitage Museum, Palace Square, Admiralty, Senatskaya Square, Kazan Cathedral, Kazanskaya Square, Nikolskaya Square and Teatralnaya Square. A great number of restaurants, bars, boutiques and stores are located in the neighborhood.

Image 7 Image 8 Description The Property comprises an office center complex with vehicular access via the front facade. The 6-floor scheme (6 floors on one side and 5 floors with mansard on the other) retains its historic facade and provides partitioned class ǩ office with completed finishing.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total building area –2,218.3 sqm; Ɣ GLA – 2,019.06 sqm (GLA Ratio – 91% of the total area); Ɣ Land plot –the part of the land plot related to the Property is not isolated

Tenure Ɣ Buildings – freehold (ownership certificates 78-AZ 111574 dated July 8, 2016; 78-Aǯ 111573 dated July 8, 2016; 78-Aǯ 111575 dated July 8, 2016; 78-Aǯ 111576 dated July 8, 2016; 78-Aǯ 111574 dated July 8, 2016; 78-Aǯ 111578 dated July 8, 2016; 78-Aǯ 111579 dated July 8, 2016; 78-Aǯ 111577 dated July 8, 2016; 78-Aǯ 111572 dated July 8, 2016; 78-Aǯ 111571 dated July 8, 2016; 78-AZ 113628 dated October 9, 2013; 78-AZ 304014 dated February 21, 2014; 78-ǧǭ 351209 dated November 24, 2011; 78-ǧǭ 351210 dated November 24, 2011; 78-ǧǭ 351361 dated November 24, 2011; 78-ǧǭ 518131 dated April 7, 2012; 78-ǧǭ 518132 dated April 7, 2012)

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Terms and Reversion Method and Comparative Method were applied. considerations Terms and Reversion Method considerations: Average rental rate (Terms /Reversion period), rubles per sqm p.a.: 12,128/17,876; Average OpEx, rubles per sqm p.a.: 3,511 Caprate (Terms /Reversion period): 10%/10.75%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 235,284,000 RUB

5. Smolny Park

Property type Elite class residential

Address Lit A, 4, Smolnogo St, St.Petersburg

Location

The Property is located in the Central Administrative District of St Petersburg, on Smolnogo St., within a 25-minute walk from Chernyshevskaya metro station. The Property is situated in the historical centre of the city, a short distance from Shpalernaya St. and Suvorovsky Ave that provide direct access to Vosstaniya Square and Nevsky Prospect (approx., 3.3 km from the Property), and borders Smolnaya Embankment. The Smolny Cathedral, Alexander Institute for Noble Maidens, the Parter Garden with fountains comprises the immediate surroundings of the Property.. The existing amenities will be further improved by retail premises on the ground floors of the Smolny Park residential buildings and other new buildings in surrounding area (e.g. in 2016 the supermarket of Lenta has been opened in Basel BC). The scheme will provide residential accommodation in a quiet park zone in the very centre of the city with educational institutions nearby.

Description

Image 9 Image 10 Elite-class residential complex of 14 buildings, 3 of which are reconstructed buildings of historical value. The scheme varies in height between 1 and 8 above ground floors with 3-3.45 m ceiling

height, comprises office and retail space, and an underground car park with 832 car spaces and elevators connecting parking and apartments.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 131,411 sqm (Ph.2: 40,032 sqm; Ph.3: 49,844 sqm; Ph.4: 41,535 sqm); Ɣ NSA (excluding parking) – 73,362 sqm (Ph.2: 24,503 sqm; Ph.3: 22,949 sqm; Ph.4: 25,910 sqm); Ɣ Residential premises area – 63,146 sqm (Ph.2: 22,667 sqm; Ph.3: 22,949 sqm; Ph.4: 17,531 sqm); Ɣ Commercial premises area – 10,216 sqm (Ph.2: 1,837 sqm; Ph.4: 8,379 sqm); Ɣ Parking – 832 parking lots/11,024 sqm (Ph.2: 245 lots; Ph.3: 469 lots; Ph.4: 118 lots); Ɣ Available residential premises area – 4,357 sqm (Ph.2: 725 sqm; Ph.3: 172 sqm; Ph.4: 3,461 sqm); Ɣ Available commercial premises area – 7,091 sqm (Ph.4: 7,091 sqm); Ɣ Available parking lots – 242 parking lots (Ph.2: 38 lots; Ph.3: 171 lots; Ph.4: 33 lots). Ɣ Land plots – 8.65 hectares.

Tenure Ɣ Land plots – leasehold (lease agreement on investment terms 20/ZK-02037 dated June 24, 2004; Addendum dated July 18, 2006; Addendum 2 dated December 28, 2006; Addendum dated September 6, 2007; Addendum 4 dated August 20, 2009; Addendum 5 dated May 12, 2010)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Construction start/completion dates: March 2012/December 2016; Ɣ Sales start/completion dates: July 2012/December 2021; Ɣ Stage of development: Ph.2, Ph.3, Ph.4 – completed; Ɣ Number of phases: 3 (according to provided data); Ɣ Estimated costs after the valuation date: 3,364,000 RUB Ɣ Prices per sqm or parking unit: residential Ph.2: 293,768 RUB; residential Ph.3: 374,750 RUB; residential Ph.4: 393,779 RUB; commercial Ph.2: 135,000 RUB; commercial Ph.4: 129,883 RUB; parking: 1,936,842 RUB-2,115,152 RUB; Ɣ Estimated Revenue (in current prices): 3,915,388,000 RUB (including 860,558,888 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 16.18%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 3,425,273,000 RUB

6. Radishcheva 39

Property type Elite Class Residential

Address Lit M, 39, Radishcheva St, St Petersburg

Location

The Property is located in the Central District of St Petersburg, within a 10-minute walk from Chernyshevskaya metro station. The Property borders the mix-used complex of Paradny Kvartal and is logical extension of its concept. The landmarks and recreation subjects in the surrounding are Tavrichesky Garden, Tavrichesky Palace, Suvorov Museum. Also a number of educational facilities are in close proximity to the Property.

Description

Image 11 Image 12 A residential complex of 8 above ground and 1 underground floors comprising elite-class residential with 148 app., office and retail space, and an underground car park for 197 car spaces. The Property comprises a regularly shaped land plot. The complex has neoclassic style façade made as individual design project.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 31,923 sqm; Ɣ NSA (excluding parking) – 20,879 sqm; Ɣ Residential premises area – 18,768 sqm; Ɣ Commercial premises area – 1,998 sqm; Ɣ Other premises area (self-storage) – 112.6 sqm; Ɣ Parking – 197 parking lots/2,490 sqm; Ɣ Available commercial premises area – 276 sqm; Ɣ Available parking lots – 2 parking lots; Ɣ Land plot – 0.85 hectares

Tenure Ɣ Land plot – freehold (ownership certificates 78 ǧǩ 11354 dated August 31, 2006)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: February 2013/August 2015; Ɣ Sales start/completion dates: October 2012/August 2018; Ɣ Stage of development: Completed; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 106,000 RUB Ɣ Prices per sqm or parking unit: commercial: 161,275 RUB; parking: 1,550,000 RUB; Ɣ Estimated Revenue (in current prices): 114,231,000 RUB (including 66,618,652 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 16.18%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 110,719,000 RUB

7. Verona

Property type Elite class residential

Address Lit A, 29, Morskoy Pr, St.Petersburg

Location

The Property is located in Petrogradsky District of St Petersburg, in the central part of Kresotvsky Island and is within a 5-minute walk from Krestovsky Ostrov metro station. The surrounding of the land plot is represented by elite residential complexes. There is a park zone a short walking distance to the east of the Property. Also the landmarks in the neighborhood are Elagin Palace, Divo-Ostrov entertainment park, two yacht-clubs, restaurants, sporting and educational facilities. The construction of the new football stadium «St. Petersburg Arena» is underway in the eastern part of Krestovsky Island.

Description

Image 13 Image 14 Residential complex comprising 80 elite-class residential premises with 3-3.2 m ceiling height and an underground car park for 111 car spaces. The Property comprises the modern security system, de-lux classified elevators (OTIS) and modern building engineering systems.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 20,329 sqm; Ɣ NSA (excluding parking) – 12,044 sqm; Ɣ Residential premises area – 10,263 sqm; Ɣ Commercial premises area – 1,451 sqm; Ɣ Other premises area (self-storage) – 330 sqm; Ɣ Parking – 111 parking lots/1,471 sqm; Ɣ Available residential premises area – 3,569 sqm; Ɣ Available commercial premises area – 254 sqm; Ɣ Available other premises area (self-storage) – 330 sqm; Ɣ Available parking lots – 107 parking lots; Ɣ Land plot – 0.36 hectares

Tenure Ɣ Land plot – freehold (ownership certificate 78-ǧǭ 029869 dated November 18, 2010)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: August 2015/June 2018; Ɣ Sales start/completion dates: December 2014/December 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 266,933,000 RUB; Ɣ Prices per sqm or parking unit: residential: 393,825 RUB; commercial: 282,510 RUB; other premises area – 114,290 RUB, parking: 2,355,140 RUB; Ɣ Estimated Revenue (in current prices): 2,185,385,000 RUB (including 418,515,135 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.79%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,767,396,000 RUB

8. Neva Art, Neva Residence (REB Flota)

Property type Elite class residential

Address 17, Remeslennaya St., St Petersburg

Location

Remeslennaya, 17

The Property is located in Petrogradsky District of St Petersburg. The Property is on Petrovsky Island that is now being developed as a new premium location being close to the city center. For a long time this location remained a territory of old industrial buildings and zones neighbouring with yacht clubs and restaurants in the western part of the island. Nowadays a number of residential development projects are being under construction on Petrovsky island. The closest ones are Royal Park (Kortros), Ostrov (Stroitelny Trest), Petrovskaya riv’era (Severniy Gorod), Petrovsky Park (Setl City). The closest metro station is Sportivnaya (within a 10-minute walking distance from the Property). The Property access by vehicles is provided from Remeslennaya St. At the valuation date the construction of the bridge through Serny island connecting Petrogradsky and Vasileostrovsky districts is going on. The commission of the new bridge will improve the accessibility of Petrovsky island and the Property.

Description

Image 15 Image 16

Land plots with a project of an elite residential complex construction. The object is planned to be completed in 2022. The new residential complex will comprise of residential and commercial premises, underground parking, pre-school and apartments.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 216,942 sqm; Ɣ NSA (excluding parking)– 116,807 sqm; Ɣ Residential premises area – 63,391 sqm; Ɣ Commercial premises area – 3,489 sqm; Ɣ Apartments area – 49,927 sqm; Ɣ Parking – 1,238 parking lots/16,403 sqm; Ɣ Land plot – 7.82 hectares

Tenure Ɣ Land plot – freehold (Extracts from the United State Register of Real Estate Property, dated September 28, 2016 and November 02, 2016)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2018/December 2022; Ɣ Sales start/completion dates: April 2018/June 2024; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 12,802,404,000 RUB Ɣ Prices per sqm or parking unit: (residential: 194,395 RUB; commercial: 169,566 RUB; apartments: 215,000 RUB; parking: 1,515,670 RUB) Ɣ Estimated Revenue (in current prices): 25,525,187,000 RUB; Ɣ Discount Rate: 18.40%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 7,665,505,000 RUB

9. Neva Haus Bavaria

Property type Elite class residential

Address 9, 11, Petrovsky Av., St Petersburg

Location

The Property is located in Petrogradsky District of St Petersburg. The Property is on Petrovsky Island that is now being developed as a new premium location being close to the city center. For a long time this location remained a territory of old industrial buildings and zones neighbouring with yacht clubs and restaurants in the western part of the island. Nowadays a number of residential development projects are being under construction on Petrovsky island. The closest ones are Royal Park (Kortros), Ostrov (Stroitelny Trest), Petrovskaya riv’era (Severniy Gorod), Petrovsky Park (Setl City). The closest metro stations are Sportivnaya and Chkalovskaya (both are within a 30-minute walking distance from the Property). The Property access by vehicles is provided from Petrovsky Av. At the valuation date the construction of the bridge through Serny island connecting Petrogradsky and Vasileostrovsky districts is going on. The commission of the new bridge will improve the accessibility of Petrovsky island and the Property.

Description

Image 17 Image 18 Land plots with a project of an elite residential complex construction. The object is planned to be completed in 2022. The new residential complex will comprise of residential and commercial premises and underground parking.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 190,789 sqm; Ɣ NSA (excluding parking) – 110,838 sqm; Ɣ Residential premises area – 106,411 sqm; Ɣ Commercial premises area – 4,428 sqm; Ɣ Parking – 879 parking lots/11,647 sqm; Ɣ Land plot – 6.28 hectares

Tenure Ɣ Land plot – freehold (Extracts from the United State Register of Real Estate Property, dated October 17, 2016, October 18, 2016, October 26, 2016 and November 03, 2016)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: October 2017/December 2022; Ɣ Sales start/completion dates: October 2017/December 2023; Ɣ Number of phases: 3; Ɣ Estimated costs after the valuation date: 12,558,512,000 RUB Ɣ Prices per sqm or parking unit: (residential: 225,220 RUB; commercial: 150,883 RUB; parking: 1,800,000 RUB) Ɣ Estimated Revenue (in current prices): 20,452,617,000 RUB (including 412,395,374 RUB for bargains before December 31, 2017)

Ɣ Discount Rate: 16.9%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 6,158,318,000 RUB

10. Dom na Dvoryanskoy

Property type Elite class residential

Address liter Ǩ, 13, Kuybysheva St, St Petersburg

Location

The Property is located in the Petrogradsky District of St Petersburg, it takes 10-min walking to reach the Property from Gorkovskaya metro station. This exact area is where St Petersburg was initially founded, a lot of beautiful and historical buildings are situated here. St Petersburg's most gorgeous landmarks such as Peter and Paul's Fortress (often named the heart of the city) with its Cathedral, Aurora cruiser, St Petersburg Cathedral Mosque, and recreational facilities (Summer Garden and Marsovo Pole) are located nearby. Also the Artillery museum, St Petersburg's zoo and Planetarium, the Music hall, Entertainment center Velican Park, a few theatres and cinemas create the great cultural and entertainment infrastructure. The Business Centres, educational facilities, restaurants and stores are highly concentrated in the neighborhood as well.

Description

Image 19 Image 20 Dom na Dvoryanskoy is an elite-class residential 8-floor building with two main entrances and 57 apartments. There are built-in commercial premises in the ground floor and undergorun parking for 35 cars. The style of the complex can be described as modern, the same as the other

buildings in the area. The curved shape of window openings on the upper floors and ornaments in facades add expressiveness and emphasize the style of affiliation. Huge windows let in plenty of light: this method is actively used the outstanding architects of the late XIX century.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 8,787 sqm; Ɣ NSA (excluding parking) – 6,352 sqm; Ɣ Residential premises area – 5,610 sqm; Ɣ Commercial premises area – 743 sqm; Ɣ Parking – 35 parking lots/463,8 sqm; Ɣ Available residential premises area – 188 sqm; Ɣ Available parking lots – 3 parking lots. Ɣ Land plot – 0.19 hectares

Tenure Land plot – freehold (ownership certificate 78 ǧǪ 953380 dated March 05, 2009)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: February 2013/June 2015; Ɣ Sales start/completion dates: February 2013/September 2018; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 0 RUB Ɣ Prices per sqm or parking unit: (residential: 212,040 RUB; parking: 1,600,000 RUB) Ɣ Estimated Revenue (in current prices): 48,166,000 RUB (including 3,417,552 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.18%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 45,440,000 RUB

11. Osobnyak Truvorova

Property type Elite class residential

Address liter A, 64, Martynova Emb., St Petersburg

Location

Osobnyak Truvorova has the premium location for elite residential property in St Petersburg – on Krestovsky island. A lot of high-end real estate is concentrated here. The main advantages of the place are comfortability, calmness and safety due to the extended park area located in immediate proximity. Many cafes, restaurants, sports facilities (for instance, courts for lawn tennis, football fields, etc.), entertainment services are situated in the neighborhood.

Image 22 Image 21 Description The mansion that belonged to Askalon Truvorov, famous St Petersburg archeografer, was built in the neoclassical style on Krestovsky Island in 1893 by architect Rukteshel. Osobnyak Truvorova was renovated with care for its historic appearance. It has its own landscaped area, separated from Martynova Emb. The main facade overlooks Srednyaya Nevka embankment and Elagin Island. The building looks impressive: the front facade is decorated with columns and mascarons

(lion masks), large arched windows. The building is colored in light yellow. The Property may have a different purpose of use – from the comfortable living residence to an apartment of class de luxe, as well as any commercial purpose. The house consists of 3 floors including the basement.

Stage of development Completed

Development Sell strategy

Areas Ɣ Building – 1,212 sqm Ɣ Land plot – 0.21 hectares

Tenure Land plot – freehold; Building – freehold (ownership certificate 78 ǧǯ 102030 dated November 16, 2015)

Valuation Ɣ Applied method(-s) of valuation: Comparative Method; considerations Ɣ Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value. Ɣ Sales start/completion dates: October 2016/February 2018; Ɣ Estimated costs after the valuation date: 0 RUB Ɣ Prices per sqm or parking unit: other premises area: 386,202 RUB; Ɣ Estimated Revenue (in current prices): 468,000,000 RUB Ɣ Discount Rate: not calculated

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 513,000,000 RUB

12. Russkiy dom (Baskov)

Property type Elite class residential

Address 5, Korolenko St., St Petersburg

Location

The Property is located in the Central District of St Petersburg within a 10-minute walk from Chernyshevskaya metro station. The proximity of main thoroughfares such as Nevsky Ave, Ligovsky Ave, Voskresenskaya and Smolnaya Embankments provides easy access the Property from various parts of the city. The Property is surrounded by the administrative buildings built in the 18th-19th centuries, many of which are of historical value. The largest orthodox church in the city, Spaso-Preobrazhensky Cathedral is in close proximity to the Property.

Image 23 Image 24 Description An elite residential complex is under construction. The object is planned to be completed in 2018. Compositional decision of the project is based on a combination of open pedestrian area

and two spacious private courtyards. The core of the composition is the courtyard space visually opened to Baskov Lane. Dynamic silhouette, expressiveness of the facade composition, the presence of bay windows, towers allow the new complex to become an organic element of the existing historic look of the city.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total building area – 93,725 sqm; Ɣ NSA (excluding parking) – 56,261 sqm; Ɣ Residential premises area – 49,319 sqm; Ɣ Commercial premises area – 6,942 sqm; Ɣ Parking – 516 parking lots/6,837 sqm; Ɣ Available residential premises area – 12,117 sqm; Ɣ Available commercial premises area – 3,478 sqm; Ɣ Available parking lots – 314 parking lots. Ɣ Land plots – 2.4 hectares

Tenure Ɣ Land plots – freehold (ownership certificate 78 ǧǮ 689775 dated April 16, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: April 2015/June 2018; Ɣ Sales start/completion dates: March 2015/June 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 986,287,000 RUB Ɣ Prices per sqm or parking unit: (residential: 282 159 RUB; commercial: 201,377 RUB; parking: 2,158,280 RUB) Ɣ Estimated Revenue (in current prices): 6,218,711,000 RUB (including 1,421,770,987 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.79%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 4,501,379,000 RUB

13. Europa City

Property type Business class residential

Address Liter ǭ, 10, Medikov Ave, St Petersburg

Location

The Property is located to the north-east of the Petrogradsky District of St Petersburg, within a 10-minute walk from Petrogradskaya metro station. The project has a good transport accessibility from vary districts of the city due to the main thoroughfares of Petrogradsky District – Medikov Ave, Kamennoostrovsky Ave and Bolshoy Petrogradskoi Storony Ave, Aptekarskaya Embankment. The major arterial routes of Petrogradsky District have a large number of retail shops, restaurants, cinemas and modern business centers. Botanical Garden and Lopuhinskiy Garden are within a 10-minute walk from the site.

Image 25 Image 26 Description Business-class residential complex comprising 17 residential buildings of varied height (9 and 14 floors), some of which comprise ground floor commercial premises. The construction of the housing divided into 4 Phases. At the valuation date all phases have been constructed. The project includes a kindergarten, an underground car park, a surface parking and green areas with a unique landscape design.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 135,554 sqm (Ph.3: 70,109 sqm; Ph.4: 65,445 sqm); Ɣ NSA (excluding parking)– 84,120 sqm (Ph.3: 42,675 sqm; Ph.4: 41,445 sqm); Ɣ Residential premises area – 71,634 sqm (Ph.3: 36,744 sqm; Ph.4: 35,122 sqm); Ɣ Commercial premises area – 11,658 sqm (Ph.3: 5,434 sqm; Ph.4: 6,224 sqm); Ɣ Self-storage premises area – 828 sqm (Ph.3: 497 sqm; Ph.4: 331 sqm); Ɣ Parking – 492 parking lots/6,150 sqm (Ph.3: 303 lots; Ph.4: 189 lots); Ɣ Available residential premises area – 13,334 sqm (Ph.3: 877 sqm; Ph.4: 12,457 sqm); Ɣ Available commercial premises area – 542 sqm (Ph.3: 119 sqm; Ph.4: 423 sqm); Ɣ Available self-storage premises area – 194 sqm (Ph.4); Ɣ Available parking lots – 263 parking lots (Ph.3: 122 lots; Ph.4: 141 lots); Ɣ Land plots – 7.36 hectares

Tenure Ɣ Land plot – freehold (ownership certificate 78-ǧǭ 570124 dated June 26, 2012)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2012/September 2017 ; Ɣ Sales start/completion dates: May 2014/June 2019; Ɣ Stage of development: completed; Ɣ Number of phases: 4; Ɣ Estimated costs after the valuation date: 83,663,000 RUB Ɣ Prices per sqm or parking unit: residential Ph.3: 151,860 RUB; residential Ph.4: 151,839 RUB; commercial Ph.3: 170,000 RUB; commercial Ph.4: 152,941 RUB; self storage Ph.4: 65,000 RUB, parking: 1,451,639-1,461,702 RUB; Ɣ Estimated Revenue (in current prices): 2,806,364,000 RUB (including 300,942,494 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.18%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 2,455,117,000 RUB

14. Tri Vetra

Property type Business class residential

Address Plot 151, Block 66a, Savushkina St., St Petersburg

Location

The Property is located in the Primorsky District of St Petersburg. The neighborhood of the Property includes new built housing complexes, shopping centers, hypermarkets. Despite of the location in the district with a difficult transport accessibility, the Property has a beneficial location due to the proximity to the new thoroughfare – West high-speed Diameter (ZSD). The other benefit of the Property location is the proximity to the Gulf of Finland. The city park (Park 300-letiya Sankt-Peterburga) is in 10-minutes walk from the Property. The closest metro station - Staraya Derevnya is in 10-minutes drive by public transport from the Property.

Image 27 Image 28 Description Business class residential complex comprising 3 residential 13-floor buildings including in total 758 apartments. The Property comprises commercial premises, an underground parking and two

multilevel above ground parking buildings for 720 parking spaces in total.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 108,246 sqm; Ɣ NSA (excluding parking) – 55,871 sqm; Ɣ Residential premises area – 52,564 sqm; Ɣ Commercial premises area – 2,491 sqm; Ɣ Self-storage premises area – 816 sqm; Ɣ Parking – 720 parking lots/9,540sqm; Ɣ Available residential premises area – 12,242 sqm; Ɣ Available commercial premises area – 1,665 sqm; Ɣ Available self-storage premises area – 402 sqm; Ɣ Available parking lots – 547 parking lots; Ɣ Land plot – 3.05 hectares

Tenure Ɣ Land plots – leasehold (land lease agreement 17/Ǯǫ-03630 dated January 20, 2006, #2 dated September 1, 2011; #3 dated September 1, 2011; #4 dated November 15, 2012)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: June 2015/December 2017; Ɣ Sales start/completion dates: April 2015/December 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 373,626,000 RUB Ɣ Prices per sqm or parking unit: residential: 186,487 RUB; commercial: 123,267 RUB; self storage: 74,439 RUB, parking: 869,400 RUB) Ɣ Estimated Revenue (in current prices): 4,257,889,000 RUB (including 1,264,206,504 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.65%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 3,511,176,000 RUB

15. Moskovskoye Hgwy (NEO, Hotel)

Property type Business class residential and hotel

Address liter ǫ, 3, Moskovskoye Hw, St Petersburg

Location

NEO

The Property is located in Moskovsky District of St Petersburg, at the crossroad of Moskovskoye Highway and Dunaisky Ave. NEO is located in 15 minutes walk from Zvezdnaya metro station. Moskovskoye and Pulkovskoye Highways provide easy and direct access both to the city center and to the areas beyond the St Petersburg ring road, and to Pulkovo Airport also. Dunaysky Ave is also an important thoroughfare connecting the south districts of the city. The commercial infrastructure of the neighborhood is represented by hypermarkets (Lenta, O'Key, METRO Cash & Carry, OBI, Castorama). In the proximity to the Property two new shopping and entertainment centers are located – Kontinent and Torgovy Dvor. Park Gorodov Geroyev, a large green area with a pond, is only 100 m from the Property.

Image 29 Image 30

Description At the valuation date the residential complex is being constructed. The business class residential complex comprises 89 residential premises, parking for 81 cars, self-storage premises. The Property is located at its own land plot closely to Viva housing complex, but belongs to the higher class. Proximity to the housing complex of Viva makes its infrastructure available.

Stage of development Design (Hotel)/completed (NEO)

Development Build and sell strategy

Areas Ɣ Total buildings area – 40,124 sqm (NEO – 15,963 sqm, Hotel – 24,161 sqm); Ɣ NSA (excluding parking) – 24,210 sqm (NEO – 9,496 sqm, Hotel – 14,714 sqm); Ɣ Residential premises area – 9,205 sqm (NEO); Ɣ Commercial premises area – 1,784 sqm (Hotel); Ɣ Self-storage premises area – 13,221 sqm (NEO – 291 sqm, Hotel – 12,930 sqm); Ɣ Parking – 165 parking lots/2,186.5 sqm (NEO – 1,073.25 sqm, Hotel – 1,113 sqm); Ɣ Available residential premises area – 2,999 sqm (NEO); Ɣ Available commercial premises area – 1,784 sqm (Hotel); Ɣ Available self-storage premises area – 13,057 sqm (NEO – 127 sqm, Hotel – 12,930 sqm); Ɣ Available parking lots – 122 parking lots (NEO – 38, Hotel – 84); Ɣ Land plot – 9.15 hectares (according to documents – 11.5 hectares)

Tenure x Land plot – freehold (ownership certificate 78-ǧǭ 910247 dated March 25, 2013)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: NEO – December 2015/December 2017; Hotel – June 2018/June 2021; Ɣ Sales start/completion dates: NEO – September 2015/December 2018; Hotel – May 2018/December 2021; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 1,488,178,000 RUB (NEO – 202,235,000 RUB, Hotel – 1,285,943,000 RUB); Ɣ Prices per sqm or parking unit: residential: 211,916 RUB; commercial: 140,000 RUB; self storage: 88,894-150,000 RUB; parking: 1,000,000-2,026,316 RUB); Ɣ Estimated Revenue (in current prices): 3,258,333,000 RUB (including 261,227,811 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.18%/ 17.04%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,465,707,000 RUB

16. Morskoy Façade

Property type Business class residential

Address Nevskaya Guba, plots 12, 13, 14, 15, St Petersburg

Location

Property is located in the south part of alluvial area of Vasilievsky Island. The nearest metro station – «Primorskaya» (within a 30-minute walking distance from the Property). New metro station «Morskoy FaȘade» is being designed (within a 10-minute walking distance from the Property), is going to be completed in 2021. The building area will be provided with all necessary social, business and transport infrastructure and its own 25 hectares park. The main access roads to the Property will be the street-road network of Vasilievskiy Island: Michmanskaya St, Morskaya Emb.

Image 31 Image 32

Description Property is divided in two zones. The «Sea view» zone – commercial residences on the first line with view on the Gulf of Finland. The «Boulevard» zone – commercial residences with park view. The process of environment and alluvial territories development is planned for March 2019.

Stage of development Concept development

Development Build and sell

strategy

Areas Ɣ Total buildings area – 885,876 sqm; Ɣ NSA (excluding parking) – 507,601 sqm; Ɣ Residential premises area – 470,000 sqm; Ɣ Self-storage premises area – 37,601 sqm; Ɣ Parking – 5,010 parking lots/66,382.5 sqm; Ɣ Available residential premises area – 470,000 sqm; Ɣ Available commercial premises area – 37,601 sqm; Ɣ Available parking lots – 5,010 parking lots; Ɣ Land plot – 33.9 hectares

Tenure x Land plot – freehold (Extracts from the United State Register of Real Estate dated September 06, 2017)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2019/December 2027; Ɣ Sales start/completion dates: June 2019/ December 2028; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 45,567,437,000 RUB Ɣ Prices per sqm or parking unit: residential: 115,000 RUB; commercial: 135,000 RUB, parking: 750,000 RUB) Ɣ Estimated Revenue (in current prices): 62,883,635,000 RUB Ɣ Discount Rate: 19.29%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 10,936,431,000 RUB

17. Chyornaya Rechka

Property type Business class residential

Address 3, Lit. ǧ, Ǳ, ǫ, Chernoy Rechki Emb., St Petersburg

Location

Property is located in close proximity to the center part of the city (the border with the Petrogradskiy District goes through the Neva river). Property is located to the east of the confluence of the Black river to the Neva river. The closest metro station – «Ǹhyornaya Rechka» (within 15 minutes walking). Property is located close to a big amount of cultural and leisure facilities: Stroganovsky Park, Pionersky Garden, Tihiy Otdih Park, ZPKiO park, etc. Property is far from noisy highways and is surrounded by gardens. Also located nearby: “Aquatoria” business center (with restaurant-market and fitness center), Torzhkovskiy market with a variety of different shops. Property has good transport access to «retail corridor» - Kamenoostrovsky prospect, where many brand shops are located. In nearby quarters there are all infrastructure facilities – kindergartens, schools, hign-schools, public and private medical clinics.

Image 33 Image 34

Description Property with built-in premises, parking and fitness center. Construction start date is November 2018. At the vauation date the nearby area is building up by new modern housing complexes.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 53,098 sqm; Ɣ NSA (excluding parking) – 32,701 sqm; Ɣ Residential premises area – 30,659 sqm; Ɣ Commercial premises area – 2,041 sqm; Ɣ Parking – 200 parking lots/2,650 sqm; Ɣ Available residential premises area – 30,659 sqm; Ɣ Available commercial premises area – 2,041 sqm; Ɣ Available parking lots – 200 parking lots; Ɣ Land plot – 1.68 hectares

Tenure x Land plot – freehold

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: November 2018/December 2020; Ɣ Sales start/completion dates: April 2018/ December 2021; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 2,472,056,000 RUB Ɣ Prices per sqm or parking unit: residential: 130,000 RUB; commercial: 160,000 RUB, parking: 1,000,000 RUB) Ɣ Estimated Revenue (in current prices): 4,512,341,000 RUB Ɣ Discount Rate: 18.90%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,345,872,000 RUB

18. Bogemia

Property type Business class residential

Address 14, Smolenskaya St, St Petersburg

Location

Bogemia

Bogemia complex is located in Moskovsky District of St Petersburg, within 7 min walk of Frunzenskaya metro station. Bogemia is situated in close proximity to Moskovsky Ave - one of the main thoroughfares of the city, but at the same time it is in a quiet area of Smolenskaya St., far from the bustle of the city noises. In recent years Moskovsky district became a business district due to a lot of new constructed business centers. On the other side there are respectable residential blocks located along Moskovsky Ave. The infrastructure was mainly formed long time ago, so it is convenient to live there closely to shops, supermarkets, entertainment of all kinds, etc.

Image 35 Image 36 Description The business class residential complex is s being constructed. The existing buildings on the land plot were demolished within the development process. The new building will have from 7 to 14

floors, 228 apartments, a few of the apartments will comprise the large terraces. Wide halls and corridors, large windows, high ceilings - these all are advantages of grand neoclassical building. In front of the house there will be nice courtyard. For vehicles of residents Bohemia will provide underground parking for 154 cars. On the ground floor the commercial premises will be located.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area (of the future buildings) – 34,352 sqm; Ɣ NSA (excluding parking) – 21,965 sqm; Ɣ Residential premises area – 20,814 sqm; Ɣ Commercial premises area – 1,151 sqm; Ɣ Parking – 154 parking lots/2,040.5sqm; Ɣ Available residential premises area – 9,793 sqm; Ɣ Available commercial premises area – 334 sqm; Ɣ Available parking lots – 102 parking lots; Ɣ Land plot – 0.69 hectares

Tenure Ɣ Land plot – freehold (ownership certificate 78-ǧǭ 978449 dated June 14, 2013)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: May 2016/September 2018; Ɣ Sales start/completion dates: November 2015/December 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 807,814,000 RUB Ɣ Prices per sqm or parking unit: residential: 158,974 RUB; commercial: 156,816 RUB, parking: 1,645,098 RUB) Ɣ Estimated Revenue (in current prices): 2,265,362,000 RUB (including 488,463,727 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.90%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,204,392,000 RUB

19. Yuzhnaya Aquatoriya

Property type Mass market residential

Address Block 28, 28a, Doblesti St, St Petersburg

Location

The Property is located in the northwestern part of Krasnoselsky District of St Petersburg, in the block bordered with Marshala Kazakova St., Geroyev Av., Leninsky Av., Patriotov Ave and also in the planned block bordered with Marshala Kazakova St., Baltiysky Blvd, Leninsky Av., Patriotov Av. The neighborhood is not serviced by metro stations, the nearest metro stations – Leninsky Prospekt and Prospect Veteranov are located in 6 km from the Property. The new metro station, Prospekt Geroev, is planned to be built by 2025 in close proximity to the Property.

Image 37 Image 38 Description Mass-market residential complex consists of 6 residential buildings of 7 - 25 floors with commercial premises, a multilevel above ground parking, and a guest parking zone. The complex comprises sport outside facilities, children playgrounds, promenades and green zones. At the valuation date the construction is held on plots No 1, 2, 9, the buildings on plots 6, 13, 14 are

completed and commissioned. The buildings on the plot No 24 are currently designed.

Stage of development Design/Construction/Completed

Development Build and sell strategy

Areas Ɣ Total buildings area – 538,320 sqm; Ɣ NSA (excluding parking) – 326,971 sqm (Plot 13: 39,307 sqm, Plot 14: 63,576 sqm, Plot 24: 36,063 sqm, Plot 9: 56,878 sqm, Plot 1: 12,144 sqm, Plot 2: 87,279 sqm, Plot 6: 31,724 sqm); Ɣ Residential premises area – 271,026 sqm (Plot 13: 38,994 sqm, Plot 14: 61,750 sqm, Plot 9: 52,466 sqm, Plot 1: 11,037 sqm, Plot 2: 75,220 sqm, Plot 6: 31,559 sqm); Ɣ Commercial premises area – 23,359 sqm (Plot 13: 313 sqm, Plot 14: 1,826 sqm, Plot 24: 3,478 sqm, Plot 9: 4,412 sqm, Plot 1: 1,108 sqm, Plot 2: 12,058 sqm, Plot 6: 165 sqm); Ɣ Apartments area – 32,585 sqm (Plot 24: 32,585 sqm); Ɣ Parking – 2,659 parking lots/35,231 sqm (Plot 13: 300 lots, Plot 14: 600 lots, Plot 24: 465 lots, Plot 9: 328 lots, Plot 1: 66 lots, Plot 2: 600 lots, Plot 6: 300 lots); Ɣ Available residential premises area – 24,619 sqm (Plot 13: 59 sqm, Plot 14: 110 sqm, Plot 9: 72 sqm, Plot 2: 24,293 sqm, Plot 6: 85 sqm); Ɣ Available commercial premises area – 13,938 sqm (Plot 14: 75 sqm, Plot 24: 3,478 sqm, Plot 9: 752 sqm, Plot 2: 9,633 sqm); Ɣ Available apartments area – 32,585 sqm (Plot 24: 32,585 sqm); Ɣ Available parking lots – 2,154 parking lots (Plot 13: 237 lots, Plot 14: 424 lots, Plot 24: 465 lots, Plot 9: 248 lots, Plot 1: 35 lots, Plot 2: 445 lots, Plot 6: 300 lots); Ɣ Land plots – 23.90 hectares

Tenure Ɣ Land plots – leasehold (lease agreement 08-ǮǫǱ-02441 dated December 2, 2013, 08-ǮǫǱ- 02442 dated December 2, 2013, 08-ǮǫǱ-02443 dated December 2, 2013, 08-ǮǫǱ-02444 dated December 2, 2013, 08-ǮǫǱ-02445 dated December 2, 2013, 08-ǮǫǱ-02446 dated December 2, 2013, 08-ǮǫǱ-02447 dated December 2, 2013, 08-ǮǫǱ-02448 dated December 2, 2013, Ǳ 08-ǮǫǱ-02449 dated December 2, 2013, Ǳ 08-ǮǫǱ-02450 dated December 2, 2013, 08-ǮǫǱ-02453 dated December 2, 2013, 08-ǮǫǱ-02454 dated December 2, 2013, 08-ǮǫǱ- 02456 dated December 2, 2013, 08-ǮǫǱ-02451 dated December 2, 2013, 08-ǮǫǱ-02452 dated December 2, 2013, 08-ǮǫǱ-02455 dated December 2, 2013, 08-ǮǫǱ-02457 dated December 2, 2013, 08-ǮǫǱ-02458 dated December 2, 2013, 08-ǮǫǱ-02459 dated December 2, 2013, 08-ǮǫǱ-02460 dated December 2, 2013, 08-ǮǫǱ-02461 dated December 2, 2013, Addendum7 to the lease agreement 08/ǮǱǸ-000069 dated June 8, 2007)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: November 2012/December 2020; Ɣ Sales start/completion dates: November 2012/December 2021; Ɣ Number of phases: 7; Ɣ Estimated costs after the valuation date: 3,586,776,000 RUB Ɣ Prices per sqm or parking unit: residential (econom): 90,000-103,528 RUB; commercial: 86,309- 140,000 RUB; apartments: 75,000 RUB, parking: 261,675-554,286 RUB) Ɣ Estimated Revenue (in current prices): 8,897,447,000 RUB (including 1,869,157,050 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.79%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 4,421,248,000 RUB

20. Sophiya

Property type Mass market residential

Address Plots 3, 8, 12, 5, 7, 3*, 13, 8*, 1, Lit ǻ, 49, 6, Yuzhnoe Hwy, St Petersburg

Location

The Property is located in Frunzensky District, in the south of St Petersburg, in the block formed by Sofiyskaya St., Dimitrova St., Bukharestskaya St. and Yuzhnoye Highway. Bukharestskaya St. provides direct access to the city centre via Ligovsky Ave, and Sofyskaya St. provides direct access to the St Petersburg's Ring Road (KAD) in circa 3.3 km from the Property. The nearest metro station, Mezhdunarodnaya, is located in a 5 minute distance by public transport. Another metro station, Prospect Slavy, located within a short walking distance from the Property, is planned for completion at 2018. There are vast green areas with large ponds along the northern and southern borders of the Property. The surrounding buildings to the west, north and south (beyond the green zones) are mostly mass market residential with accompanying amenities. A large industrial zone lies to the east of the Property. There are two modern retail subjects in the neighborhood – Yuzhny Polus shopping centre and Lenta hypermarket.

Image 39 Image 40

Description The residential complex comprising 22 residential buildings of 20 - 25 floors with integrated commercial space, multilevel above ground ventilated parking and a guest parking zone. The complex comprises commercial buildings, social infrastructure, sport outside facilities, children playgrounds, promenades and green zones as a fully fitted-out residential accommodation. The construction of the residential complex is divided into 5 phases. At the valuation date three of them are completed, other phases are being constructed.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 419,273 sqm; Ɣ NSA (excluding parking) – 313,698 sqm; Ɣ Residential premises area – 308,386 sqm; Ɣ Commercial premises area – 5,313 sqm; Ɣ Parking – 1,304 parking lots/ 16,639 sqm; Ɣ Available residential premises area – 7,910 sqm; Ɣ Available commercial premises area – 1,015 sqm; Ɣ Available parking lots – 824 parking lots; Ɣ Land plots – 21.90 hectares

Tenure Ɣ Land plots – freehold (ownership certificates: 78-ǧǭ 854249 dated February 14, 2013; 78-ǧǭ 897211 dated March 28, 2013; 78-ǧǭ 854623 dated February 15, 2013; 78-ǧǭ 897209 dated March 28, 2013; 78-ǧǭ 854235 dated February 14, 2013; 78-ǧǭ 897212 dated March 28, 2013; 78-ǧǭ 897210 dated March 28, 2013; 78-ǧǭ 854234 dated February 14, 2013; 78-ǧǭ 854250 dated February 15, 2013; 78-ǧǭ 854233 dated February 14, 2013; 78-ǧǭ 854237 dated February 14, 2013; 78-ǧǭ 854645 dated February 18, 2013; 78-ǧǭ 854244 dated February 14, 2013; 78-ǧǭ 854232 dated February 14, 2013; 78-ǧǭ 854642 dated February 18, 2013; 78-ǧǭ 854643 dated February 18, 2013; 78-ǧǭ 854242 dated February 14, 2013; 78- ǧǭ 854638 dated February 18, 2013; 78-ǧǭ 854240 dated February 14, 2013; 78-ǧǭ 854239 dated February 14, 2013; 78-ǧǭ 854241 dated February 14, 2013; 78-ǧǭ 897206 dated March 28, 2013; 78-ǧǭ 854243 dated February 14, 2013)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2013/December 2018; Ɣ Sales start/completion dates: June 2013/December 2018; Ɣ Number of phases: 5; Ɣ Estimated costs after the valuation date: 646,057,000 RUB Ɣ Prices per sqm or parking unit: residential (econom): 111,558 RUB; commercial: 138,972 RUB, parking: 583,556 RUB) Ɣ Estimated Revenue (in current prices): 2,524,925,000 RUB (including 1,020,542,521 RUB for bargains before December 31, 2017); Discount Rate: 16.40%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 1,767,340,000 RUB

21. Kalina-Park

Property type Mass market residential

Address 12, Marshala Blukhera, St Petersburg

Location

The Property is situated in Kalininsky District of St Petersburg, in the block bordered by Marshala Blyukhera Ave, Laboratorniy Ave, Bestuzhevskaya St. and Kushelevskaya road. The neighborhood is represented by new developed residential area with associated social and commercial infrastructure. The Property has good accessibility. All types of public transport are good developed in the subject district. The metro stations Lesnaya and Ploshad Muzhestva are located in 3 and 5 km from the Property respectively.

Image 41 Image 42 Description The residential complex consisting of several buildings of 9 - 25 floors with integrated commercial premises and multilevel above ground parking. Fully fitted-out residential accommodation is to include children playgrounds, boulevard, green zones and sport outside facilities. The housing complex is divided into 4 phases (1-2 phases are named Kalina Park, the 3rd phase is named Kaleidoscope the 4th phase has the name of Cinema). At the valuation date two phases are completed and commissioned, other phases are being constructed.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 498,554 sqm; Ɣ NSA (excluding parking) – 342,905 sqm; Ɣ Residential premises area – 336,590 sqm; Ɣ Commercial premises area – 6,315 sqm; Ɣ Parking – 1,416 parking lots/ 18,762 sqm; Ɣ Available residential premises area – 56,613 sqm; Ɣ Available commercial premises area – 685 sqm; Ɣ Available parking lots – 368 parking lots; Ɣ Land plots – 34.45 hectares

Tenure Ɣ Land plots – freehold (ownership certificates: 78-ǧǯ 235521 dated April 12, 2016; 78-ǧǯ 235518 dated April 12, 2016; 78-ǧǯ 235519 dated April 12, 2016; 78-ǧǯ 235520 dated April 12, 2016; 78-ǧǯ 234315 dated April 12, 2016; 78-ǧǯ 235516 dated April 12, 2016; 78-ǧǯ 221691 dated March 01, 2016; 78-ǧǭ 835679 dated February 21, 2013; 78-78/037-78/037/100/2015-1768/1 dated September 04, 2015; 78-78/037-78/037/100/2015-1767/1 dated September 04, 2015; 78- 78/037-78/037/100/2015-1771/1 dated September 04, 2015; 78-78/037-78/037/100/2015-1769/1 dated September 04, 2015; 78-78/037-78/037/100/2015-1770/1 dated September 04, 2015; 78-ǧǯ 077573 dated June 22, 2015; 78-ǧǮ 111932 dated October 15, 2013; 78-ǧǭ 976434 dated March 15, 2013; 78-ǧǮ 166099 dated November 20, 2013; 78-ǧǮ 338382 dated April 24, 2014; 78-ǧǮ 111930 dated October 15, 2013; 78-ǧǭ 932559 dated April 23, 2013; 78-ǧǮ 111928 dated October 15, 2013; 78-ǧǮ 111929 dated October 15, 2013; 78-ǧǮ 111927 dated October 15, 2013; 78-ǧǮ 111926 dated October 15, 2013; 78-ǧǮ 111925 dated October 15, 2013)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: December 2012/January 2019; Ɣ Sales start/completion dates: February 2013/December 2019; Ɣ Development strategy: Build and Sell; Ɣ Stage of development: construction; Ɣ Number of phases: 4; Ɣ Estimated costs after the valuation date: 2,795,267,000 RUB Ɣ Prices per sqm or parking unit: residential: 93,281 RUB; commercial: 130,000 RUB, parking: 461,889 RUB) Ɣ Estimated Revenue (in current prices): 7,413,957,000 RUB (including 1,873,977,723 RUB for bargains before December 31, 2017); Discount Rate: 16.90%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 4,032,657,000 RUB

22. Novaya Okhta

Property type Mass market residential

Address Murinskaya road, St Petersburg

Location

The Property is located along Murinskaya Road, near St Petersburg Ring Road (KAD), in Krasnogvardeysky District of St- Petersburg. The proximity to KAD provides access to diferrent parts of the city. The nearest metro stations are Devyatkino and Grazhdansky Prospect (5 min drive from the Property). The Property is surrounded by agricultural land, parkland and Okhta River and Tsvetnoy Gorod development projects.

Image 43 Image 44 Description The Property is a residential complex under construction, a part of the project of complex development. The construction of residential complex is devided into 3 phases (each of them consists of several stages). The future residential complex will consist of more than 30 residential buildings of different number of floors (up to 25) with built-in commercial premises and multilevel above ground parking. Also the subjects of social infrastructure are planned to build within the development process: 3 schools, 5 kindergartens and 2 clinics.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 915,323 sqm; Ɣ NSA (excluding parking) – 764,833 sqm; Ɣ Residential premises area – 743,576 sqm; Ɣ Commercial premises area – 21,257 sqm; Ɣ Parking – 3,380 parking lots/44,797.4 sqm; Ɣ Available residential premises area – 192,556 sqm; Ɣ Available commercial premises area – 4,595 sqm; Ɣ Available parking lots – 2,962 parking lots; Ɣ Land plots – 88,28 hectares Ɣ TenureƔ Ɣ Land plots - freehold (ownership certificates: 78-ǧǭȶ905260 dated April 5, 2013; 78-ǧǭ ȶ905261 dated April 5, 2013; 78-ǧǭȶ905262 dated April 5, 2013; 78-ǧǭȶ905263 dated April 5, 2013; 78-ǧǭȶ905264 dated April 5, 2013; 78-ǧǭȶ905265 dated April 5, 2013; 78- ǧǭȶ905266 dated April 5, 2013; 78-ǧǭȶ905267 dated April 5, 2013; 78-ǧǭȶ905259 dated April 5, 2013; 78-ǧǮȶ455367 dated August 14, 2014; 78-ǧǮȶ455363 dated August 14, 2014; 78-ǧǮȶ602321 dated October 31, 2014; 78-ǧǮȶ602321 dated December 10, 2014; 78-ǧǮȶ673999 dated February 12, 2015; 78-ǧǮȶ674000 dated February 12, 2015; 78-ǧǮȶ698157 dated February 12, 2015; 78-ǧǮȶ698198 dated February 12, 2015; 78-ǧǮ ȶ698180 dated February 12, 2015; 78-ǧǮȶ698179 dated February 12, 2015; 78-ǧǮ ȶ698178 dated February 12, 2015; 78-ǧǮȶ698177 dated February 12, 2015; 78-ǧǮ ȶ698176 dated February 12, 2015; 78-ǧǮȶ698160 dated February 12, 2015; 78-ǧǮ ȶ698159 dated February 12, 2015; 78-ǧǮȶ698158 dated February 12, 2015; 78-ǧǮ ȶ698170 dated February 12, 2015; 78-ǧǮȶ698169 dated February 12, 2015; 78-ǧǮ ȶ698168 dated February 12, 2015; 78-ǧǮȶ698164 dated February 12, 2015; 78-ǧǮ ȶ698161 dated February 12, 2015; 78-ǧǮȶ698162 dated February 12, 2015; 78-ǧǮ ȶ698163 dated February 12, 2015; 78-ǧǮȶ698165 dated February 12, 2015; 78-ǧǮ ȶ698166 dated February 12, 2015; 78-ǧǮȶ698175 dated February 12, 2015; 78-ǧǮ ȶ698174 dated February 12, 2015; 78-ǧǮȶ698172 dated February 12, 2015; 78-ǧǮ ȶ698171 dated February 12, 2015; 78-ǧǮȶ698167 dated February 12, 2015; 78-ǧǮ ȶ673997 dated February 12, 2015; 78-ǧǮȶ673998 dated February 12, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: September 2012/December 2019; Ɣ Sales start/completion dates: May 2013/December 2020; Ɣ Number of phases: 4; Ɣ Estimated costs after the valuation date: 10,289,874,000 RUB Ɣ Prices per sqm or parking unit: residential: 75,215 RUB; commercial: 116,283; parking: 256,772 RUB) Ɣ Estimated Revenue (in current prices): 17,223,172,000 RUB (including 1,445,154,450 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.54%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 5,073,744,000 RUB

23. Ruchyi/ Tsvetnoy Gorod Vostok

Property type Mass market residential

Address 145, Piskarevsky Av., St Petersburg

Location

Tsvetnoy Gorod

The Property located at the North-East of St Petersburg, along the border with Leningradskaya Oblast’. The surrounding area consists of former agricultural land plots, private cottages and territories of new residential development. The infrastructure of this area is not developed, but all the projects of complex development imply the construction of infrastructure objects. The immediate proximity of St Petersburg Ring road and Piskarevsky Ave provides easy access to the Property from other districts of the city. Public transport accessibility at the valuation date is unsatisfactory but due to current residential development of this district the situation with public transport will be improved in process of completing projects.

Image 45 Image 46 Description At the valuation date the project is under construction. One of the buildings is on the ground storey stage of construction; others are on the stage of foundation.

The future housing complex will consist of residential buildings of different number of floors with integrated commercial premises, multilevel aboveground ventilated parking, and social facilities: 8 schools, 16 kindergartens, 4 clinics and 1 hospital. The construction stage of the 1st phase has started in 2016.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 1,294,091 sqm; Ɣ NSA (excluding parking) – 1,023,081 sqm; Ɣ Residential premises area – 941,197 sqm; Ɣ Commercial premises area – 25,884 sqm; Ɣ Other premises area (self-storage) – 56,000 sqm; Ɣ Parking – 5,827 parking lots/151,425 sqm; Ɣ Available residential premises area – 894,818 sqm; Ɣ Available commercial premises area – 25,754 sqm; Ɣ Available other premises area (self-storage) – 56,000 sqm; Ɣ Available parking – 5,827 parking lots/151,425 sqm; Ɣ Land plot – 163.92 hectares

Tenure Land plots – freehold

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: May 2016/December 2024; Ɣ Sales start/completion dates: June 2016/December 2025; Ɣ Number of phases: 4; Ɣ Estimated costs after the valuation date: 54,849,173,000 RUB Ɣ Prices per sqm or parking unit: (residential: 68,885 RUB; commercial premises: 105,266 RUB; self-storage – 65 000 RUB; parking: 200,000 RUB) Ɣ Estimated Revenue (in current prices): 70,670,824,000 RUB (including 1,514,761,160 RUB for bargains before December 31, 2017)

Ɣ Discount Rate: 18.68%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 7,889,257,000 RUB

24. Ruchyi/ Tsvetnoy Gorod Zapad

Property type Mass market residential

Address 145, Piskarevsky Av., St Petersburg

Location

Tsvetnoy Gorod

Image 47 Image 48

Description At the valuation date the project is in concept development. The construction stage of the 1st phase is going to started in May 2023.

Stage of development Concept development

Development Build and sell strategy

Areas Ɣ Total buildings area – 2,012,612 sqm; Ɣ NSA (excluding parking) – 1,390,780 sqm; Ɣ Residential premises area – 1,369,310 sqm; Ɣ Commercial premises area – 21,470 sqm; Ɣ Parking – 7,225 parking lots/95,731 sqm; Ɣ Available residential premises area – 1,369,310 sqm; Ɣ Available commercial premises area – 21,470 sqm; Ɣ Available parking – 7,225 parking lots/95,731 sqm; Ɣ Land plot – 199.27 hectares

Tenure Land plots – freehold

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: May 2023/December 2033; Ɣ Sales start/completion dates: May 2023/December 2033; Ɣ Number of phases: 5; Ɣ Estimated costs after the valuation date: 73,737,984,000 RUB Ɣ Prices per sqm or parking unit: (residential: 70,000 RUB; commercial premises: 105,000 RUB; parking: 200,000 RUB); Ɣ Estimated Revenue (in current prices): 99,551,050,000 RUB Ɣ Discount Rate: 19.90%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 5,118,772,000 RUB

25. Ruchyi-7

Property type Mass market residential

Address 145, Piskarevsky Av., St Petersburg

Location

Ruchyi-7

Image 49 Image 50 Description The construction is planned to set up in 2018. At the valuation date the projecting stage is on.

The residential complex will consist of several residential blocks of variable storeys with built-in commercial premises, multilevel parking and detached objects of social infrastructure: a school and 2 kindergartens.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 253,825 sqm; Ɣ NSA (excluding parking)– 211,421 sqm; Ɣ Residential premises area – 209,435 sqm; Ɣ Commercial premises area – 1,986 sqm; Ɣ Parking – 2,546 parking lots/33,734.5 sqm; Ɣ Available residential premises area – 209,435 sqm; Ɣ Available commercial premises area – 1,986 sqm; Ɣ Available parking lots – 2,546 parking lots; Ɣ Land plots – 19.94 hectares

Tenure Ɣ Land plots - freehold (ownership certificates: 78-ǧǭ 868775 dated February 20, 2013; 78-ǧǭ 904413 dated March 25, 2013; 78-ǧǭ 868584 dated February 19, 2013; 78-ǧǭ 868583 dated February 19, 2013; 78-ǧǭ 868585 dated February 19, 2013)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: May 2018/June 2023; Ɣ Sales start/completion dates: July 2018/June 2023; Ɣ Number of phases: 2 (Valuer’s forecast); Ɣ Estimated costs after the valuation date: 13.002.016.000 RUB Ɣ Prices per sqm or parking unit: residential: 72,000 RUB; commercial: 110,000; parking: 200,000 RUB) Ɣ Estimated Revenue (in current prices): 15,806,980,000 RUB; Ɣ Discount Rate: 19.18%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 1,593,484,000 RUB

26. Shuvalovsky

Property type Mass market residential

Address plot 208, Prigorodny (Kamenka), St Petersburg

Location

The Property is situated in Primorsky District of St Petersburg. The Property is located within 10 min drive from Pionerskaya and Komendantskiy Prospekt metro stations. The Property is located close to the main thoroughfares of the district. The neighborhood benefits from the number of nearby leisure, retail and social amenities. There is Novoorlovsky forest and a nature reserve, Yuntolovskaya Dacha, in close proximity to the Property which features an artificial lake, playgrounds and walking paths.

Image 51 Image 52 Description The housing complex is under construction, works are currently in progress. It is being developed as a mass-market residential complex. The complex will comprise 23 residential buildings of 16- 25 floors with supportive commercial premises on ground floors, and multi-level aboveground parking. The construction of the residential is divided into 5 phases.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 639,598 sqm; Ɣ NSA (excluding parking) – 422,221 sqm; Ɣ Residential premises area – 415,650 sqm; Ɣ Commercial premises area – 5,770 sqm; Ɣ Self-storage premises area – 801 sqm; Ɣ Parking parking lots– 2,490 /32,922.5 sqm; Ɣ Available residential premises area – 172,664 sqm; Ɣ Available commercial premises area – 4,185 sqm; Ɣ Available self-storage premises area – 689 sqm; Ɣ Available parking lots – 1,703 parking lots; Ɣ Land plots – 30.90 hectares

Tenure Ɣ Land plots – freehold (ownership certificates: 78-ǧǮ 429741 dated July 03, 2014; 78-ǧǮ 419547 dated June 16, 2014; 78-ǧǮ 419548 dated June 16, 2014; 78-ǧǮ 419545 dated June 16, 2014; 78-ǧǮ 418929 dated June 10, 2014; 78-ǧǮ 419392 dated June 10, 2014; 78-ǧǮ 419398 dated June 10, 2014; 78-ǧǮ 481971 dated August 28, 2014; 78-ǧǮ 481973 dated August 28, 2014; 78-ǧǮ 419395 dated June 10, 2014; 78-ǧǮ 419396 dated June 10, 2014; 78-ǧǮ 419397 dated June 10, 2014; 78-ǧǮ 419391 dated June 10, 2014; 78-ǧǮ 418931 dated June 10, 2014; 78-ǧǮ 419394 dated June 10, 2014)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: July 2014/December 2020; Ɣ Sales start/completion dates: July 2014/June 2021; Ɣ Number of phases: 5; Ɣ Estimated costs after the valuation date: 11,215,240,000 RUB Ɣ Prices per sqm or parking unit: residential: 83,779 RUB; commercial: 128,723 RUB; self-storage: 79,553 RUB; parking: 313,887 RUB) Ɣ Estimated Revenue (in current prices): 17,664,009,000 RUB (including 2,125,239,382 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.90%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 5,040,603,000 RUB

27. Oktyabrskaya Naberezhnaya (Rudas, Barrikada)

Property type Mass market residential

Address 42, Oktyabrskaya Emb., St Petersburg

Location

The Property is located in Nevsky District of St Petersburg within a 20-40 min walk of Ulitsa Dybenko metro station. The Property is conveniently accessible from Oktyabrskaya Embankment, which allows to easily reach all city districts and KAD. The following subjects are situated in the neighborhood and surroundings: Park Stroiteley, sporting and cultural centers - Ledovy Dvoretz sports center, stadium of watersports Nevskaya Volna, retail and entertainment center London Mall, variety of supermarkets - Karusel, Lenta, Castorama, Leroy Merlin, and also fitness center Olympic and Gazprom sports club.

Image 53 Image 54 Description The project implies the construction of residential complex. The project development scheme consists of 8 phases. The buildings will be made of monolith-and-brick or prefabricated concrete panels, and will provide fitted-out or Shell&Core residential accommodation.

Stage of development Design/Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 1,284,730 sqm (Rudas – 692,951 sqm, Barrikada – 591,778 sqm); Ɣ NSA (excluding parking)– 824,787 sqm (Rudas – 437,783 sqm, Barrikada – 387,004 sqm); Ɣ Residential premises area – 731,154 sqm (Rudas – 358,008 sqm, Barrikada – 373,146 sqm); Ɣ Apartments area (Rudas) – 59,887 sqm; Ɣ Commercial premises area – 33,746 sqm (Rudas – 19,888 sqm, Barrikada – 13,858 sqm); Ɣ Parking – 4,570 parking lots/60,552.5 sqm (Rudas – 2,650 lots, Barrikada – 1,920 lots); Ɣ Available residential premises area – 618,547 sqm (Rudas – 245,401 sqm, Barrikada – 373,146 sqm); Ɣ Available commercial premises area – 28,407 sqm (Rudas – 14,549 sqm, Barrikada – 13,858 sqm); Ɣ Available apartments area (Rudas) – 59,887 sqm; Ɣ Available parking lots – 4,495 parking lots (Rudas – 2,575 lots, Barrikada – 1,920 lots); Ɣ Land plots – 58.97 hectares (Rudas – 30.46 hectares, Barrikada – 28.51 hectares);

Tenure Ɣ Land plots - freehold (ownership certificates: 78-ǧǮ 659645 dated December 27, 2014; 78-ǧǮ 256015 dated February 14, 2014; 78-ǧǮ 256016 dated February 14, 2014; 78-ǧǮ 252233 dated December 05, 2013; 78-ǧǯ 248968 dated April 18, 2016; 78-ǧǯ 032071 dated May 05, 2015; 78-ǧǯ 032070 dated May 05, 2015; 78-ǧǮ 745103 dated April 01, 2015;)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: Rudas – February 2016/August 2022; Barrikada – January 2019/June 2024; Ɣ Sales start/completion dates: Rudas – March 2016/August 2023; Barrikada – March 2019/December 2024; Ɣ Number of phases: 8; Ɣ Estimated costs after the valuation date: 51,744,077,000 RUB (Rudas: 25,641,181,000 RUB, Barrikada: 26,102,896 RUB); Ɣ Prices per sqm or parking unit: residential: 96,269-98,749 RUB; commercial: 134,267-138,717 RUB; apartments: 100,000 RUB; parking: 495,437-500,000 RUB) Ɣ Estimated Revenue (in current prices): 75,220,863,000 RUB (including 2,965,303,498 RUB for bargains before December 31, 2017); Ɣ Discount Rate: Rudas: 17.40%, Barrikada: 19.29%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 13,150,092,000 RUB

28. Zapovednaya

Property type Mass market residential

Address Plots 14,17, Orlovo-Denisovskiy Av., St.Petersburg

Location

The object is located in Primorsky district of St Petersburg, between Suzdalsky Ave and Zapovednaya St., 7 km from the metro station Prospect Prosvescheniya, 3.5 km from Vyborgskoe Hw, 3 km from the Parachutnaya St, 7 km from the Ring Road (KAD). 2 new metro stations Kamenka and Shuvalovskiy Prospect are scheduled for opening in 2025. Novoorlovsky forest park is located at a distance of 1-2 km from the Property. Objects of social and commercial infrastructure are available in nearby neighborhood, at a distance 2 km from the property. At a distance of 4-5 km from the facilities there are hypermarkets Lenta and Okay.

Image 55 Image 56

Description At the valuation date the land plot is vacant. The project implies the construction of residential complex. It is planned to build circa 150 thousand sqm of real estate, of which 86,814 sqm will be residential and the rest refers to where commercial premises and parking for 750 cars will take place.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 134,874 sqm; Ɣ NSA (excluding parking) – 89,055 sqm; Ɣ Residential premises area – 86,814 sqm; Ɣ Commercial premises area – 2,241 sqm; Ɣ Parking – 750 parking lots/9,937 sqm; Ɣ Available residential premises area – 86,759 sqm; Ɣ Available commercial premises area – 2,241 sqm; Ɣ Available parking lots – 750 parking lots; Ɣ Land plots – 5.92 hectares

Tenure Ɣ Land plots - freehold (ownership certificates : 78-ǧǮ 732571 dated April 3, 2015, 78-ǧǮ 731751 dated April 3, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: June 2019/December 2022; Ɣ Sales start/completion dates: February 2019/December 2022; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 4,832,586,000 RUB Ɣ Prices per sqm or parking unit: residential: 80,000 RUB; commercial: 110,000; parking: 250,000 RUB) Ɣ Estimated Revenue (in current prices): 7,379,728,000 RUB (including 5,050,142 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 18.40%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 1,544,443,000 RUB

29. Aeroport Rzhevka

Property type Mass market residential

Address Airport Rzhevka, Kovalevo Settlement, Vsevolozhsky District, Leningradskaya Oblast'

Location

Rzhevka

The Property is located in Vsevolozhsky district of Leningradskaya Oblast’, 8 km from St Petersburg's border. It is 4 km distance from Ryabovskoye Hw, 4 km from the Ring Road (KAD). The closest metro station Ladozhskaya is at 12 km distance. The object is bordered on the North- East by the Kovalevo village. Kovalevo with the rest side of the object is surrounded by forest. The infrastructure in the neighborhood is poorly developed; the nearest social and commercial facilities are located at a distance of 7-8 km from the Property.

Image 57 Image 58 Description The land plot is vacant at the valuation date. The Project is at the designing and projecting stage. The future residential complex is to comprise buildings of different height, multi-storey car parkings and appropriate commercial and social infrastructure.

Stage of development Concept development

Development Build and sell strategy

Areas Ɣ Total buildings area – 1,585,763 sqm; Ɣ NSA (excluding parking) – 1,029,150 sqm; Ɣ Residential premises area – 1,000,000 sqm; Ɣ Commercial premises area – 29,150 sqm; Ɣ Parking – not indicated; Ɣ Land plots – 175 hectares

Tenure Ɣ Land plots - freehold (ownership certificates: 47-ǧǩ 380711 dated April 21, 2014, 47-ǧǩ 380712 dated April 21, 2014)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: January 2021/September 2030; Ɣ Sales start/completion dates: March 2021/December 2030; Ɣ Number of phases: 8; Ɣ Estimated costs after the valuation date: 54,132,034,000 RUB Ɣ Prices per sqm or parking unit: residential: 70,000 RUB; commercial: 90,000); Ɣ Estimated Revenue (in current prices): 72,623,500,000 RUB; Ɣ Discount Rate: 19.90%

Valuation date December 31, 2017

Inspection date December 21, 2017

Market value 5,064,742,000 RUB

30. Zvezdny Duet (Kosmonavtov/Dunayskiy)

Property type Mass market residential

Address Plots 1,2, Kosmonavtov Pr. (south-east of Svirskaya St crossing), St.Petersburg

Location

Kosmonavtov

The Property is located in Moskovskiy district of St Petersburg. This vacant land plot is located to the South-East of crossroads of Kosmonavtov Ave. and Svirskaya St. However, the location is rather close to metro station Zvezdnaya (9 min walk) and Kupchino (4 min drive by car). Also Moskovskoye Highway is at the distance of less than 1 km that provides the Property with easy access to different districts of the city. Pulkovskoye highway is also in convenient distance from the Property that provides access to the airport of St Petersburg (it takes about 15 min driving). The infrastructure in the neighbourhood is not formed completely yet, but within the process of complex development of the territory the situation will be improved. Also there are several malls with all kinds of shops, supermarkets, sports facilities etc. in this part of Moskovsky district. They are basically located near Kupchino and Zvezdnaya metro stations.

Image 59 Image 60 Description The project implies the construction of residential complex. At the valuation date the land plot is vacant, the project is on the stage of the conception working out. The Property is located on the

neighbor land plot with the site of Kvartet residential complex.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 74,943 sqm; Ɣ NSA (excluding parking) – 47,378 sqm; Ɣ Residential premises area – 47,078 sqm; Ɣ Commercial premises area – 300 sqm; Ɣ Parking – 257 parking lots/3,405.25 sqm; Ɣ Available residential premises area – 44,895 sqm; Ɣ Available commercial premises area – 300 sqm; Ɣ Available parking lots – 257 parking lots; Ɣ Land plots – 2.43 hectares

Tenure Ɣ Land plots – leasehold (Lease agreement 12/ǮǱǸ-10017 dated November 16, 2015; and 12/ǮǱǸ-10018 dated November 16, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: June 2018/December 2020; Ɣ Sales start/completion dates: December 2017/December 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 3,239,987,000 RUB Ɣ Prices per sqm or parking unit: residential: 110,911 RUB; commercial: 154,357 RUB; parking: 500,000 RUB) Ɣ Estimated Revenue (in current prices): 5,395,259,000 RUB (including 241,136,522 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 17.40%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,475,366,000 RUB

31. Paradny Kvartal

Property type Commercial

Address 1-3, Paradnaya St, St Petersburg

Location

The office center is located in Central District of St Petersburg, it takes 15 minutes to walk from Chernyshevskaya metro station. The access to the Property is provided from Vilensky Lane. The proximity of main thoroughfares such as Suvorovskiy Ave, Nevsky Ave, Ligovsky Ave, Voskresenskaya and Smolnaya Embankments provides easy access the Property from various parts of the city. The following landmarks are situated in the neighborhood: Tavrichesky Garden and Palace, Smolny Cathedral, Suvorov Museum. Paradny Kvatal is a mixed-use complex. It is implied the residents will access the diverse infrastructure of this residential complex consisting of stores, supermarkets, educational facilities and a fitness center nearby.

Image 61 Image 62 Description The Property is the office building, completed in May 2014. The office building comprises 4 floors and an underground parking for 60 cars. The office premises in the building can be classified as A-class offices. All the office premises are in shell & core fit-out.

Stage of development Completed

Development Sell (rent) strategy

Areas Ɣ Total building area – 12,607 sqm; Ɣ NSA/GLA – 12,074 sqm; Ɣ Land plot – 9.57 hectares

Tenure Building – freehold (ownership certificate 78-ǧǮ 558886 dated October 7, 2014)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF) and Comparative Method; considerations Ɣ Construction start/completion dates: October 2012/May 2014; Residual method considerations Ɣ Rental rate RUB per sqm p.a.: 20,843.8; Ɣ OpEx, rubles per sqm p.a.: 5,270.9; Ɣ Capitalization rate: 10.5%; Ɣ Discount rate: 16.4%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 1,422,112,000 RUB

32. Nevsky 1

Property type Commercial

Address 1, Nevsky Av, St Petersburg

Location

The Property is located in Central District of St Petersburg within a 10-minute walk of Nevsky Prospekt and Gostinyi Dvor metro stations. The following landmarks are situated in close proximity to the Property: Hermitage Museum, Palace Square, The Admiralty, Senatskaya Square, St. Isaac's Cathedral. A great amount of restaurants, bars, boutiques and stores are located on Nevsky Ave. Bolshoy Gostiny Dvor Shopping Center is located within a 15-minute walk of the Property.

Image 63 Image 64 Description The Property comprises a building being a monument of a historical interest. According to the project development scheme it is planned to internally refurbish the premises only and renovate the facade. It is forbidden to demolish the building due to its' historical interest. The redeveloped brick / monolith-concrete building will comprise commercial premises and parking for 20 cars.

Stage of development Reconstruction

Development Reconstruction and sell strategy

Areas Ɣ Total building area – 9,357 sqm; Ɣ NSA (excluding parking) – 8,509 sqm; Ɣ Commercial premises area – 8,509 sqm; Ɣ Parking – 20 parking lots/250 sqm; Ɣ Land plots – 0.25 hectares

Tenure Ɣ Building – freehold (ownership certificates 78-ǧǭ 807894 dated January 12, 2013; 78-ǩǲ 955118 dated January 30, 2004; 78-ǩǲ 955124 dated January 30, 2004; 78-ǩǲ 955103 dated January 30, 2004; 78-ǩǲ 955109 dated January 30, 2004; 78-ǩǲ 955104 dated January 30, 2004; 78-ǩǲ 955108 dated January 30, 2004; 78-ǩǲ 955105 dated January 30, 2004; 78-ǩǲ 955101 dated January 30, 2004; 78-ǩǲ 955110 dated January 30, 2004; 78-ǧǪ 517007 dated July 22, 2008; 78-ǧǪ 308928 dated March 11, 2008; 78-ǩǲ 953038 dated January 30, 2004; 78- ǩǲ 955123 dated January 30, 2004; 78-ǧǧ 720253 dated February 17, 2006; 78-ǩǲ 953034 dated January 30, 2004; 78-ǩǲ 955107 dated January 30, 2004; 78-ǩǲ 953035 dated January 30, 2004; 78-ǧǩ 551995 dated June 6, 2006; 78-ǩǲ 953037 dated January 30, 2004; 78-ǧǩ 551996 dated June 6, 2006; 78-ǧǩ 551997 dated June 6, 2006; 78-ǧǩ 859514 dated September 27, 2007; 78-ǧǩ 551998 dated June 6, 2006; 78-ǩǲ 955114 dated January 30, 2004; 78-ǩǲ 955106 dated January 30, 2004; 78-ǧǪ 308926 dated March 11, 2008; 78-ǩǲ 955130 dated January 30, 2004; 78-ǩǲ 955128 dated January 30, 2004; 78-ǧǩ 552001 dated June 6, 2006; 78-ǧǩ 552002 dated June 6, 2006; 78-ǧǩ 552003 dated June 6, 2006; 78-ǩǲ 955127 dated January 30, 2004; 78-ǧǩ 572822 dated March 13, 2007).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: September 2016/November 2019; Ɣ Sales start/completion dates: June 2017/ November 2019; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 1,067,958,000 RUB Ɣ Discount Rate: 17.68%

Valuation date December 31, 2017

Inspection date December 19, 2017

Market value 2,535,847,000 RUB

33. Nevsky 68

Property type Commercial

Address liter B, building 40/68, riv. Fontanka Emb., St Petersburg

Location

The Property is located in Central District of St Petersburg within a 5-minute walk of Mayakovskaya and Gostiny Dvor metro stations. The Property is located at the main throughfare of St Petersburg – Nevsky Av. The following landmarks are situated in the neighborhood: Kazan Cathedral, Hermitage Museum, Russian Museum, Summer Garden (Letniy Sad), The temple of Savior-on-Blood (Khram Spasa-na-Krovi), Palace Square, St. Isaac's Cathedral, Mikhailovsky theatre, Aleksandrinsky theatre, Anichkov bridge. A huge amount of restaurants, bars, boutiques and stores are located on Nevsky Av. The following retail centres are located in close proximity to the Property: Nevsky Centre, Galereya, Nevsky Atrium, Gostiny Dvor and Passage.

Image 65 Image 66 Description According to the project development scheme, the building comprises offices, retail premises on the ground and first floors and underground parking for 26 cars. The project was completely

finished in 2013. At the valuation date retail premises are occupied by bank offices and a sales office of LSR Group.

Stage of development Completed

Development Sell (rent) strategy

Areas Ɣ Total building area – 8,400 sqm; Ɣ Commercial premises area – 8,400 sqm; Ɣ Parking lots/area – 26/973.6 sqm; Ɣ Land plots – 0.15 hectares.

Tenure Ɣ Building – freehold (ownership certificates 78-ǧǯ 204192 dated February 10, 2016; 78-ǧǯ 204196 dated February 10, 2016; 78-ǧǯ 204194 dated February 10, 2016; 78-ǧǯ 204193 dated February 10, 2016; 78-ǧǯ 204197 dated February 10, 2016; dated August 24, 2015; dated September 16, 2015; dated September 24, 2015)

Ɣ Land plot – freehold (ownership certificate 78-ǧǮ 688900 dated March 3, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF) and Comparative Method; considerations Residual method considerations Ɣ Rental rate for vacant offices, RUB per sqm p.a.: 24,566; Ɣ Rental rate for occupied retail premises (average weighted), RUB per sqm p.a.: 105,353; Ɣ OpEx, rubles per sqm p.a.: 7,115.8; Ɣ Capitalization rate: 10%; Ɣ Discount rate: 16.4%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The regression model was used to determine the Value.

Valuation date December 31, 2017

Inspection date December 20, 2017

Market value 2,331,820,000 RUB

34. Donskoy Olimp

Property type Business class residential

Address Bldg 19, 21, Serpukhovsky Val St, Moscow

Location

Donskoy Olimp

The residential complex development scheme will be developed on the land plot located at 22, Serpukhovskoy Val St., Danilovsky sub-district, South Administrative District. The sub-district has a well-developed social, transport and engineering infrastructure. It benefits from good transport accessibility through Leninsky Ave. and Varshavskoe Highway which lead to the Third Transport Road and Moscow Ring Road (MKAD). The residential complex is located in ȇ 5-minute walk from Shabolovskaya metro station. In the nearest surroundings there are residential buildings, offices, government agencies and industrial enterprises.

Image 67 Image 68

Description A business class residential complex Donskoy Olimp is being constructed in the South- of Moscow. The design and construction of the complex involves several stages. According to the architectural concept of the project in addition to residential buildings, the complex includes commercial areas and an underground parking lot.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 239,050 sqm; Ɣ NSA (excluding parking)– 88,623 sqm; Ɣ Residential premises area – 75,742 sqm; Ɣ Commercial premises area – 6,456 sqm; Ɣ Kindergarten area – 1,704 sqm; Ɣ Other premises area – 4,721 sqm; Ɣ Parking – 1,300 parking lots/8,723 sqm; Ɣ Available residential premises area – 979 sqm; Ɣ Available commercial premises area – 3,892 sqm; Ɣ Available Kindergarten area – 1,704 sqm; Ɣ Available other premises area – 2,859 sqm; Ɣ Available parking lots – 558 parking lots. Ɣ Land plots – 4.72 hectares

Tenure Ɣ Land plot with total area of 47,200 sqm – freehold (ownership certificate AC ȶ 699384dated February 24, 2016);

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: May 2013/August 2017; Ɣ Sales start/completion dates: November 2013/ June 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 572,262,000 RUB

Ɣ Prices per sqm or parking unit: residential: 265,839 RUB; commercial: 273,567; other: 105,798; parking: 1,774,397 RUB) Ɣ Estimated Revenue: 3,193,592,000 RUB (including 576,138,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.01%

Valuation date December 31, 2017.

Inspection date December 28, 2017.

Market value 2,840,612,000 RUB

35. Grunvald

Property type Business class residential

Address Zarechye Settlement, Odintsovo District, Moscovskaya Oblast'

Location

Grunvald

The Grunvald residential complex, surrounded by a park, is situated in an environment-friendly part of the Moscow region, a short way from the western boundaries of Moscow. The complex has a good link with Moscow’s centre via Skolkovskoye Shosse. The neighbourhood has a well- developed infrastructure – elite gymnasiums, schools and kindergartens together with tennis courts and golf courses are located just a short distance away. A close vicinity of the future Silicon Valley in Skolkovo will add to the project’s attractiveness.

Image 69 Image 70 Description New residential complex consists of 13 detached six-storey buildings with up to 20 residential premises in each one, providing a limited number of neighbors for comfort living conditions. The

complex will include commercial properties and an underground parking as well as a large fitness center with a sports pool. Each house of the Grunwald residential complex has its own distinguishing features but together they form a unique architectural solution.

Stage of development Completed

Development Sell strategy

Areas Ɣ Total buildings area – 58,331 sqm; Ɣ NSA (excluding parking)– 27,260 sqm; Ɣ Residential premises area – 25,011 sqm; Ɣ Commercial premises area – 744 sqm; Ɣ Other premises area – 1,505 sqm; Ɣ Parking – 270 parking lots/4,050 sqm; Ɣ Available residential premises area – 0 sqm; Ɣ Available commercial premises area – 593 sqm; Ɣ Available other premises area – 933 sqm; Ɣ Available parking lots – 94 parking lots. Ɣ Land plots – 4.1 hectares

Tenure Freehold

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2005/January 2011; Ɣ Sales start/completion dates: September 2005/ November 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 0 RUB Ɣ Prices per sqm or parking unit: commercial: 131,194; other: 66,239; parking: 1,657,024 RUB; Ɣ Estimated Revenue: 301,202,000 RUB (including 5,816,582 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 16.51%

Valuation date December 31, 2017.

Inspection date December 28, 2017.

Market value 246,600,000 RUB

36. Leningradskoye Shosse 58

Property type Business class residential

Address Bldg 14, 21, 58 Leningradskoye Hw, Moscow

Location

Leningradskoye Shosse

Residential complex is located in North district of Moscow on the second line close to Leningradsky Ave. The development project is located at the Research Institute of Mechanical Engineering (OAO NIMI). The subject property has beneficial location in terms of convenient pedestrian and transport access. Vodniy stadion metro station is located at the distance of 400 m from the Property, an access to the Property is provided by Leningradsky Ave. It is necessary to note a proximity to Sheremet'yevo International Airport – 15 km and center of Moscow – 12 km. The surrounding area has a mix of administrative and business properties and residential area. There is construction of a new Business Centre with an apartments section.

Image 71 Image 72 Description The Subject Property is a multifunctional residential development complex located on a 1.77 ha fenced land plot. Residential complex with 40 stores, 4 level underground parking and commercial premises.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 94,085 sqm; Ɣ NSA (excluding parking)– 53,575 sqm; Ɣ Residential premises area – 51,725 sqm; Ɣ Commercial premises area – 1,850 sqm; Ɣ Parking – 534 parking lots/3,450 sqm; Ɣ Land plots – 1.50 hectares

Tenure Ɣ Land plot with total area of 17,656 sqm– freehold (ownership certificate freehold (ownership certificate 77 ǧǸȶ389 417 dated July, 15, 2015) Ɣ Non-residential building with total area of 2,682.6 sqm freehold (ownership certificate 77 ǧǸ ȶ389420 dated July, 15, 2015); Ɣ Non-residential building with total area of 640 sqm freehold (ownership certificate 77 ǧǸ ȶ389419 dated July, 15, 2015).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: March 2018/ October 2020; Ɣ Sales start/completion dates: March 2018/ April 2021; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 6,098,492,000 RUB

Ɣ Prices per sqm or parking unit: residential: 167,687 RUB; commercial: 193,636; parking: 1,039,366 RUB;

Ɣ Estimated Revenue: 9,586,844,000 RUB;

Ɣ Discount Rate: 18.23%

Valuation date December 31, 2017.

Inspection date December 28, 2017.

Market value 3,296,401,000 RUB

37. ZIL-YUG

Property type Business class residential

Address 23, Avtozavodskaya street, Moscow

Location

ZIL-YUG

The multifunctional complex is being built in the Southern administrative district of Moscow, in the former industrial area MSC ZIL, on a site with a total area of 59.3 hectares, located at: 23, Avtozavodskaya street.

Image 73

Description Multifunctional complex consisting of apartment buildings and non-residential, with developed social, cultural and household, transport and engineering infrastructure to be built on the territory of the northern part of the Southern Administrative District, in the Danilovsky district of the city of Moscow, limited territory MLRR, the Moskva River, the old channel of the Moscow river and underground engineering area As part of the implementation of activities in the field of environmental protection planning area provides soundproofing increase (noise protection glazing) buildings on these plots along the major highways and MLRR. New neighborhood infrastructure will be in charge modern requirements to housing: underground parking, landscaped inner courtyards with children's and sports fields. Improvement concept is developed taking into account the preservation of existing trees and planting new lawns, lighted walking and cycling routes.

Stage of development Concept development

Development Build and sell strategy

Areas Ɣ Total bildings area – 708,256 sq. m.;

Ɣ Total NSA ( excluding parking) – 485,301 sq. m.;

Ɣ Residential premises area – 410,921 sq. m.;

Ɣ area of commercial premises – 74,380 sq. m.;

Ɣ Parking – 5,718 parking lots/47,734 sq. m.;

Ɣ Land plots – 59.30 hectares.

Tenure Ɣ The purchase agreement for the land plots Ɣ Land area of 480,532 sq. m., cadastral ȶ 77: 05: 0002005: 2733, rental agreement ȶ M-05- 044333 dated 30.01.2014 year; Ɣ Land area of 62,094 sq. m., cadastral ȶ 77: 05: 0002005: 2734, rental agreement ȶ M-05- 044517 dated 18.02.2014 year; Ɣ Land area of 423,755 sq. m., cadastral ȶ 77: 05: 0002005: 3148, rental agreement ȶ M-05- 048267 dated 23.12.2015 year; Ɣ Land area of 99,870 sq. m., cadastral ȶ 77: 05: 0002005: 3149, rental agreement ȶ M-05- 048163 dated 11.12.2015 year; Ɣ Land area of 14,964 sq. m., cadastral ȶ 77: 05: 0002005: 3152, rental agreement ȶ M-05- 047563 dated 18.08.2015 year; Ɣ Land area of 902 sq. m., cadastral ȶ 77: 05: 0002005: 3153, rental agreement ȶ M-05- 047775 dated 01.10.2015 year; Ɣ Land area of 9279 sq. m., cadastral ȶ 77: 05: 0002005: 3155, rental agreement ȶ M-05- 047564 dated 18.08.2015 year; Ɣ Land area of 1952 sq. m., cadastral ȶ 77: 05: 0002005: 3156, rental agreement ȶ M-05- 047785 dated 01.10.2015 year;

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: January 2020/ December 2029; Ɣ Sales start/completion dates: February 2020/ December 2031; Ɣ Number of phases: 9; Ɣ Estimated costs after the valuation date: 79,870,321,000 RUB

Ɣ Prices per sqm or parking unit: residential: 218,157 RUB; commercial: 255,036; parking: 1,500,000 RUB; Ɣ Estimated Revenue (in current prices): 117,191,866,000 RUB;

Ɣ Discount Rate: 21.36%

Valuation date December 31, 2017

Inspection date December 23, 2017

Market value 7,317,214,000 rubles

38. ZILART

Property type Business class residential

Address 23, Avtozavodskaya St, Moscow

Location

ZILART

Development project is located in South district at Avtozavodskaya St. The site is located in 5 minutes by the car from Tulskaya and Avtozavodskaya subway stations. Railway station ZIL is situated close to the property. From the North side the property is boarded by the Third Transport Ring. From the East side of the land plot is Railway Small Ring. The sub-district has a well-developed social, transport and engineering infrastructure. It benefits from good transport accessibility through Third Transport Ring.

Image 74 Image 75 Description The subject property is a multifunctional residential development complex located on a 65.087 hectares of land plots. Under the proposed development the project will comprise a business class residential complex with parking lot and commercial premises. The whole street will be pedestrian with limited public transport. The future residential building will consist of variable

storey from 6 to 15. Furthermore concept of development scheme plans call for open spaces, park, schools other social facilities.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 1,487,445 sqm; Ɣ NSA (excluding parking)– 961,127 sqm; Ɣ Residential premises area – 760,712 sqm; Ɣ Commercial premises area – 200,416 sqm; Ɣ Parking – 11,452 parking lots/90,502 sqm; Ɣ Available residential premises area – 410,921 sqm; Ɣ Available commercial premises area – 74,380 sqm; Ɣ Available parking lots – 10,859 parking lots; Ɣ Land plots – 65.087 hectares

Tenure Ɣ Land plot with total area of 22,907 sqm – long term lease agreement ȶǳ - 05-045473 dated October, 7, 2014); Ɣ Land plot with total area of 6,500 sqm – long term lease agreement ȶǳ – 05-045499 dated October, 15, 2014); Ɣ Land plot with total area of 17,072 sqm – long term lease agreement ȶǳ – 05-045500 dated October, 15, 2014); Ɣ Land plot with total area of 14738 sqm – long term lease agreement ȶǳ-05-045501 dated October, 15, 2014); Ɣ Land plot with total area of 8,927 sqm – long term lease agreement ȶǳ-05-045502 dated October, 15, 2014); Ɣ Land plot with total area of 16,682 sqm – long term lease agreement ȶǳ-05-045503 dated October, 15, 2014); Ɣ Land plot with total area of 17071 sqm – long term lease agreement ȶǳ-05-045504 dated October, 15, 2014); Ɣ Land plot with total area of 4,808 sqm – long term lease agreement ȶǳ-05-045505 dated October, 15, 2014); Ɣ Land plot with total area of 31,420 sqm – long term lease agreement ȶǳ-05-049515 dated 06 September 2016); Ɣ Land plot with total area of 30,741 sqm – long term lease agreement ȶǳ-05-045536 dated 23 October 2014); Ɣ Land plot with total area of 51,529 sqm – long term lease agreement ȶǳ-05-049497 dated 02 September 2016); Ɣ Land plot with total area of 31,234 sqm – amending agreemen to long term lease agreement ȶǳ-05-045538 dated 23 October 2014); Ɣ Land plot with total area of 23,353 sqm – long term lease agreement ȶǳ-05-049082 dated 07 June 2016); Ɣ Land plot with total area of 31,353 sqm – long term lease agreement ȶǳ-05-049494 dated 02 September 2016); Ɣ Land plot with total area of 16,628 sqm – long term lease agreement ȶǳ-05-045546 dated

23 October 2014); Ɣ Land plot with total area of 16,177 sqm – long term lease agreement ȶǳ-05-045547 dated 23 October 2014); Ɣ Land plot with total area of 13,142 sqm – long term lease agreement ȶǳ-05-045549 dated 23 October 2014); Ɣ Land plots with total area of 25,150 sqm – amending agreement to long term lease agreement ȶǳ-05-045552 dated 23 October 2014); Ɣ Land plot with total area of 19,913 sqm – long term lease agreement ȶǳ-05-047612 dated 31 August 2015); Ɣ Land plot with total area of 9,947 sqm – long term lease agreement ȶǳ-05-044956 dated 30 May 2014). Ɣ Land plot with total area of 16,867 sqm – long term lease agreement ȶǳ-05-049495 dated 02 September 2016); Ɣ Land plot with total area of 53,659 sqm – long term lease agreement ȶǳ-05-049511 dated 05 September 2016); Ɣ Land plot with total area of 9,119 sqm – long term lease agreement ȶǳ-05-048994 dated 05 May 2016); Ɣ Land plot with total area of 3,361 sqm – long term lease agreement ȶǳ-05-049738 dated 17 October 2016); Ɣ Land plot with total area of 3,534 sqm – long term lease agreement ȶǳ-05-049739 dated 17 October 2016); Ɣ Land plot with total area of 37,232 sqm – long term lease agreement ȶǳ-05-048995 dated 05 May 2016).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: August 2015/ December 2025; Ɣ Sales start/completion dates: September 2015/ July 2027; Ɣ Number of phases: 9; Ɣ Estimated costs after the valuation date: 146,707,641,000 RUB Ɣ Prices per sqm or parking unit: residential: 260,073 RUB; commercial: 202,280 RUB; parking: 1,631,841 RUB) Ɣ Estimated Revenue (in current prices): 228,107,508,000 RUB (including 3,667,972,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 17,96%

Valuation date December 31, 2017

Inspection date December 28, 2017

Market value 35,563,900,000 RUB

39. Luchi

Property type Mass market residential

Address Bldg 6, Proizvodstvennaya St, Moscow

Location

Luchi

Luchi is a mass market (comfort class) residential complex, located in Solntsevo district of Moscow. The development is within a 7-10 minute drive from Salarevo metro station and in reasonable proximity to a railway station Novoperedelkino. The area also benefits from its proximity to several parks, such as Balkovsky and Ulyanivsky parks. The transport system is well developed and allows easy access to the city centre. The site close to the development in the end of 2017 plans call for opening metro station Solncevo.

Image 76 Image 77

Description Luchi is a mass market (comfort class) residential complex. The design and construction of the complex involves five stages with an underground parking area. Construction use poured concrete technology with brick elements and ventilated facades. Furthermore concept of development scheme plans call for open spaces, park, schools other social facilities.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 899,585 sqm; Ɣ NSA (excluding parking)– 477,409 sqm; Ɣ Residential premises area – 419,212 sqm; Ɣ Commercial premises area – 50,713 sqm; Ɣ Parking – 3,711 parking lots/29,613 sqm; Ɣ Other premises area – 7,483 sqm; Ɣ Available residential premises area – 293,527 sqm; Ɣ Available commercial premises area – 43,771 sqm; Ɣ Available parking lots – 3,270 parking lots; Ɣ Available other premises area – 5,085 sqm; Ɣ Land plots – 39.09 hectares

Tenure Ɣ Land plot with total area of 36,167 sqm freehold (ownership certificate 77 ǧǷȶ 701352 dated October, 10, 2014); Ɣ Land plot with total area of 6,868 sqm – long term lease agreement ȶǳ - 07-047971 dated November, 3, 2015); Ɣ Land plot with total area of 57,072 sqm – long term lease agreement ȶǳ - 07-047972 dated November, 3, 2015); Ɣ Land plot with total area of 17,706 sqm – long term lease agreement ȶǳ - 07-047973 dated November, 3, 2015); Ɣ Land plot with total area of 15,360 sqm – long term lease agreement ȶǳ - 07-047974 dated November, 3, 2015); Ɣ Land plot with total area of 65,708 sqm – long term lease agreement ȶǳ - 07-047975 dated November, 3, 2015); Ɣ Land plot with total area of 56,602 sqm – long term lease agreement ȶǳ - 07-047976 dated November, 3, 2015); Ɣ Land plot with total area of 6,337 sqm – long term lease agreement ȶǳ - 07-047977 dated November, 3, 2015); Ɣ Land plot with total area of 58,614 sqm – long term lease agreement ȶǳ - 07-047978 dated November, 3, 2015); Ɣ Land plot with total area of 1,257 sqm – long term lease agreement ȶǳ - 07-047979 dated November, 3, 2015); Ɣ Land plot with total area of 24,609 sqm – long term lease agreement ȶǳ - 07-047980 dated November, 3, 2015); Ɣ Land plot with total area of 7,272 sqm – long term lease agreement ȶǳ - 07-047981 dated November, 3, 2015); Ɣ Land plot with total area of 7,825 sqm – long term lease agreement ȶǳ - 07-047982 dated November, 3, 2015);

Ɣ Land plot with total area of 29,513 sqm – long term lease agreement ȶǳ - 07-047970 dated November, 3, 2015)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: January 2016/ September 2023; Ɣ Sales start/completion dates: February 2016/ October 2026; Ɣ Number of phases: 5; Ɣ Estimated costs after the valuation date: 30,476,678,000 RUB

Ɣ Prices per sqm or parking unit: residential: 121,212 RUB; commercial: 110,349; other premises: 57,772; parking: 913,946 RUB; Ɣ Estimated Revenue (in current prices): 46,570,317,000 RUB (including 2,878,778,000 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 18.73%

Valuation date December 31, 2017

Inspection date December 24, 2017.

Market value 9,442,381, 000 RUB

40. Krasny Mayak

Property type Mass market residential

Address 26, Krasnogo Mayaka St., Moscow

Location

Mass market residential housing complex located at pedestrian accessibility from Prazhskaya metro station.

Image 78 Image 79 Description Krasniy Mayak is a mass market (comfort class) residential complex. The design and construction of the complex involves five stages with an underground parking area. Construction use poured concrete technology with brick elements and ventilated facades. Furthermore concept of development scheme plans call for open spaces, park, schools other social facilities.

Stage of development Concept development

Development Build and sell strategy

Areas Ɣ Total buildings area – 122,700 sqm; Ɣ NSA (excluding parking)– 69,300 sqm; Ɣ Residential premises area – 62,900 sqm; Ɣ Commercial premises area – 6,400 sqm; Ɣ Parking – 589 parking lots; Ɣ Land plots – 4.23 hectares

Tenure Ɣ Freehold

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: November 2018/ March 2022; Ɣ Sales start/completion dates: March 2019/ March 2022; Ɣ Number of phases: 5; Ɣ Estimated costs after the valuation date: 7,832,906,000 RUB

Ɣ Prices per sqm or parking unit: residential: 156,843 RUB; commercial: 195,642; parking: 826,601 RUB; Ɣ Estimated Revenue (in current prices): 11,604,371,000 RUB;

Ɣ Discount Rate: 20.63%

Valuation date December 31, 2017

Inspection date December 24, 2017.

Market value 2,129,399, 000 RUB

41. Novoe Domodedovo

Property type Mass market residential

Address Mikrorayon Zapadny, Domodedovo, Moscovskaya Oblast'

Location

Novoe Domodedovo

The Residential complex is located in a 22 km from Moscow Ring Road (MKAD) on the frontage line of highway M-4 Don which provides good transport accessibility to airport Domodedovo – 10 km and railway stations Vostryakovo and Vzletnaya – 3 km. The site is situated at environmentally pristine without any industrial plants. At the moment it benefits from good transport accessibility by the car but after completion plans call for arranging traffic of public transport from railway stations Vostryakovo and Vzletnaya to the residential district.

Image 80 Image 81

Description According to the concept provided by the Client a residential complex is to be built on the land plot with a total area of 39.3345 ha. The residential building consists of variable number of storeys (from 9 to 17). Development project comprised 26 blocks of residential premises, 2 schools, 2 kindergartens, multilevel parking lot, stadium and open spaces.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 567,063 sqm; Ɣ NSA (excluding parking)– 317,787 sqm; Ɣ Residential premises area – 303,191 sqm; Ɣ Commercial premises area – 14,595 sqm; Ɣ Parking – 486 parking lots/4,078 sqm; Ɣ Available commercial premises area – 188 sqm; Ɣ Available parking lots – 376 parking lots; Ɣ Land plots – 39.33 hectares

Tenure Ɣ Land plot with total area of 1,613 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2900/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 5,458 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2909/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 5,573 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2905/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 5,777 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2908/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 6,591 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2903/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 5,838 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2910/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 7,165 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2907/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 7,365 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2898/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 11,474 sqm – freehold (registration ȶ 50-50/028-

50/028/005/2016-2904/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 13,571 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2897/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 15,627 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2901/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 16,644 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2899/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016);

Ɣ Land plot with total area of 23,514 sqm – freehold (registration ȶ 50-50/028- 50/028/005/2016-2896/2, Extract from the Unied State Register of Real Estate Property, dated August 04, 2016).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: August 2011/ August 2017; Ɣ Sales start/completion dates: October 2011/July 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 81,035,000 RUB

Ɣ Prices per sqm or parking unit: commercial: 100,166 RUB; parking: 535,440 RUB Ɣ Estimated Revenue: 310,812,000 RUB (including 90,695,000 RUB from bargains before December 31, 2017);

Ɣ Discount Rate: 15.33%

Valuation date December 31, 2017.

Inspection date December 23, 2017.

Market value 154,187,000 RUB

42. Nakhabino Yasnoe

Property type Mass market residential

Address near Chernaya Village, Pavlo-Slobodskoye Settlement, Istrinsky District, Moscovskaya Oblast'

Location

Nakhabino Yasnoe

Nakhabino Yasnoe has well-developed transport and social infrastructure. The district is connected with the centre of Moscow via two motorways – Volokolamskoye Highway and Novorizhskoye Highway. Since the new road interchange has been opened, now it takes only 30- 35 minutes to get to Moscow from the neighborhood even during the rush-hour. Besides, the neighborhood lies near Nakhabino railway station, where trains run every 10-15 minutes. A short distance away there are public and private schools, a supermarket, a bowling center, restaurants, a fitness center, etc. The Property is located in the area surrounded by forestry, and there is a picturesque valley with a river in the north-west.

Image 82 Image 83 Description The Property is a multifunctional residential development complex located on land plots with total amount of 30.1 hectares. Under the proposed development the project will comprise a comfort class residential complex with parking lot and commercial premises. The Property

comprises 66 two- and three-storey EURO-houses for 8 and 12 apartments respectively. Unique facade fit-out seamless technology improves buildings’ exterior and guarantees high insulation.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 231,868 sqm; Ɣ NSA (excluding parking)– 142,818 sqm; Ɣ Residential premises area – 138,420 sqm; Ɣ Commercial premises area – 3,688 sqm; Ɣ Other premises area (self-storage) – 710 sqm; Ɣ Available residential premises area – 48,436 sqm; Ɣ Available commercial premises area – 975 sqm; Ɣ Available other premises area (self-storage) – 114 sqm; Ɣ Land plots – 30.01 hectares

Tenure Ɣ Land plot with total area of 353 sqm - freehold (registration ȶ 50-50/008-50/011/013/2016- 30/1, Extract from the Unied State Register of Real Estate Property, dated December 23, 2016);

Ɣ Land plot with total area of 10,396 sqm - freehold (registration ȶ 50-50/008- 50/008/003/2016-9857/1, Extract from the Unied State Register of Real Estate Property, dated December 27, 2016);

Ɣ Land plot with total area of 29 sqm - freehold (registration ȶ 50-50/008-50/008/003/2016- 9865/1, Extract from the Unied State Register of Real Estate Property, dated December 27, 2016);

Ɣ Land plot with total area of 47 sqm - freehold (registration ȶ 50-50/008-50/011/013/2016- 8/1, Extract from the Unied State Register of Real Estate Property, dated December 23, 2016);

Ɣ Land plot with total area of 156 sqm - freehold (registration ȶ 50-50/008-50/011/013/2016- 7/1, Extract from the Unied State Register of Real Estate Property, dated December 23, 2016);

Ɣ Land plot with total area of 9,626 sqm - freehold (registration ȶ 50-50/008- 50/011/013/2016-9/1, Extract from the Unied State Register of Real Estate Property, dated December 23, 2016);

Ɣ Land plot with total area of 29 sqm - freehold (registration ȶ 50-50/008-50/011/013/2016- 15/1, Extract from the Unied State Register of Real Estate Property, dated December 22, 2016);

Ɣ Land plot with total area of 13,234 sqm - freehold (registration ȶ 50-50/008- 50/011/013/2016-13/1, Extract from the Unied State Register of Real Estate Property, dated December 22, 2016);

Ɣ Land plot with total area of 95 sqm - freehold (registration ȶ 50-50/008-50/008/003/2016- 9871/1, Extract from the Unied State Register of Real Estate Property, dated December 26, 2016);

Ɣ Land plot with total area of 123 sqm - freehold (registration ȶ 50-50/008-50/008/003/2016-

9872/1, Extract from the Unied State Register of Real Estate Property, dated December 26, 2016);

Ɣ Land plot with total area of 9,413 sqm - freehold (registration ȶ 50-50/008- 50/008/003/2016-9873/1, Extract from the Unied State Register of Real Estate Property, dated December 26, 2016);

Ɣ Land plot with total area of 56 sqm - freehold (registration ȶ 50-50/008-50/011/013/2016- 29/1, Extract from the Unied State Register of Real Estate Property, dated December 23, 2016);

Ɣ Land plot with total area of 2,085 sqm - freehold (ownership certificate 50-ǨǨȶ852158dated March 02, 2016);

Ɣ Land plot with total area of 9,671 sqm - freehold (ownership certificate 50-ǨǨȶ841134 dated March 02, 2016);

Ɣ Land plot with total area of 10 sqm - freehold (ownership certificate 50-ǨǨȶ841132 dated March 02, 2016);

Ɣ Land plot with total area of 663 sqm - freehold (ownership certificate 50-ǨǨȶ841133 dated March 02, 2016);

Ɣ Land plot with total area of 24 sqm - freehold (ownership certificate 50-ǨǨȶ852153 dated March 02, 2016);

Ɣ Land plot with total area of 140,181 sqm - freehold (ownership certificate 50-ǨǨȶ852151 dated March 02, 2016);

Ɣ Land plot with total area of 363 sqm - freehold (ownership certificate 50-ǨǨȶ852155 dated March 02, 2016);

Ɣ Land plot with total area of 23 sqm - freehold (ownership certificate 50-ǨǨȶ852156 dated March 02, 2016).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: December 2012/ November 2019; Ɣ Sales start/completion dates: April 2013/ December 2021; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 1,448,597,000 RUB

Ɣ Prices per sqm or parking unit: residential: 66,218 RUB; commercial: 57,913 RUB; other: 12,503 RUB; Ɣ Estimated Revenue: 3,627,616,000 RUB (including 362,403,000 RUB from bargains before December 31, 2017);

Ɣ Discount Rate: 17.23%

Valuation date December 31, 2017.

Inspection date December 24, 2017.

Market value 1,676,859,000 RUB

43. Noviy Balchug

Property type Commercial

Address Bldgs. 1, 2, 3, 9, Sadovnicheskaya St, Moscow

Location

Noviy Balchug

The site is located in Central District. The proximity of the Zamoskvorechie sub-district to the city center makes it a prestigious location for both living and business. The site is located on the frontage line of Sadovnicheskaya St., which stretches along Sadovnicheskaya and Kosmodiamnskaya Embankments. It is also within a five minute walk from Novokuznetskaya metro station. The complex is well located in a pleasant environment, with the established infrastructure including large shopping centers, food stores, cinemas, hospitals and schools.

Image 84 Image 85

Description The complex comprises a single residential building with four 5-6 storey sections, two of which are commercial, with underground parking; constructed using poured concrete technology with brick elements. The ground floors will be occupied by consumer-oriented commercial premises. The development also features atrium at the courtyard.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total building area – 24,360 sqm; Ɣ NSA (excluding parking)– 10,995 sqm; Ɣ Parking – 170 parking lots/1,224 sqm; Ɣ Land plots – 0.40 hectares

Tenure Ɣ Land plot with total area of 4,000 sqm – long term lease agreement ȶǳ - 01-044921 May, 20, 2014).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: December 2014/ June 2019; Ɣ Sales start/completion dates: December 2020/ December 2020; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 1,741,897,000 RUB

Ɣ Estimated Revenue (in current prices): 7,795,245,000 RUB;

Ɣ Discount Rate: 17.73%

Valuation date December 31, 2017.

Inspection date December 28, 2017.

Market value 2,701,383,000 RUB

44. Avtozavodskaya

Property type Operating office

Address 22, Avtozavodskaya St, Moscow

Location

Avtozavodskaya

The site is located in 5 minutes drive from Tulskaya and Avtozavodskaya subway stations. Railway station ZIL is situated close to the property. From the South side the property is boarded by the Third Transport Ring. From the North side of the land plot where property is situated there is former sports area of the Dynamo manufactory and embankment of the Moscow river. An access available from Third Transport Ring. The surrounding area has a mix of administrative and business properties. The property is located opposite to under development territory of the ZIL manufactory. Development project is comprised residential and commercial properties.

Image 86 Image 87

Description The subject property is three-floor office complex. An access in the building is carried via check- point. The main entrance is located on Third Transport Ring. The complex was built in 1973. Building’s walls are made from the glass, the foundation is reinforced concrete, façade is plastered and painted, the roof is metal. The building has a cabinet-type layout. The ceiling height in cellar is 1st – 5.2 – 3.98, 2nd – 2.98 and the 3rd floors – 3.60 m.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total building area –7,767 sqm; Ɣ GLA – 6,871 sqm; Ɣ Land plot – 0.635 hectares

Tenure Ɣ Office complex – freehold (ownership certificate 77 ǧǸȶ 369944 dated June 05, 2015) Ɣ Land plot – long term leasehold (lease agreement ȶǳ - 05-018462 dated April, 18, 2002)

Valuation Direct Capitalization Method and Comparative Method were applied. considerations Direct Capitalization Method considerations: Average rental rate (Terms/ Reversion period), rubles per sqm p.a.: 16,271/15,935; Caprate: 10.5%/11.0%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The adjustment based on the market data were used to determine the Value.

Valuation date December 31, 2017.

Inspection date December 24, 2017.

Market value 1,164,694,000 RUB

45. Tverskoy Blvd

Property type Operating office

Address 16, Tverskoy blvd., Moscow

Location

Tverskoy Blvd

The Subject Property is located in Central Administrative district of Moscow, in Presnensky sub- district, on Tverskoy blvd in 500 m from Pushkinskaya metro station on the front line of the Boulevard Ring. Close to the property is located Pushkin Square and Tverskaya Street, one of the busiest places in Moscow. An access available from the Tverskoy blvd there are some bus stops slightly off the Subject. Thus, the Subject Property has good transport and pedestrian accessibility. The subject’s surroundings include social, commercial and residential estate as well as rest zones and cultural monuments. The most famous office centres in the district are the following: Class A Usadba Center located at 22, Voznesensky lane, Moscow; Class B Nikitsky Passage located at 5, bld. 6 Nikitsky lane, Moscow;

Image 88 Image 89

Description The property is newly discovered sample of architecture of 19 century – Maikov’s town mansion. The building is fully redeveloped in 2004 – 2005 with preservation of façade and cast iron stairs. The four floor building is comprised class ǩ office accommodation which is fully fitted out. There is two level underground parking lot for 30 parking spaces.

Stage of development Completed

Development Hold strategy

Areas Ɣ Buildings – 4,903.8 sqm Ɣ NSA – 2,292 Ɣ Land plots – 0.1405 hectares

Tenure Ɣ Part of the total area of the property is 1,176.8 sqm – freehold (ownership certificate ȶ 77 ǧǫȶ078696 dated March 02, 2007; 77 ǧǸȶ537313 January 11, 2015) Ɣ Part of the total area of the property is 338.5 sqm – freehold (ownership certificate 77 ǧǫȶ 076823 dated December 26, 2006) Ɣ Part of the total area of the property is 690.6 sqm – freehold (ownership certificate 77 ǧǷȶ 804839 dated October 06, 2014) Ɣ Part of the total area of the property is 1,016 sqm – freehold (ownership certificate ȶ 77 ǧǸ ȶ537314 dated January 11, 2016; 77 ǧǫȶ078697 dated March 02, 2007) Ɣ Part of the total area of the property is 1,621.9 sqm – freehold (ownership certificate 77 ǧǫ ȶ 076822 dated December 26, 2006) Ɣ Underground parking space ȶ 18 – freehold (ownership certificate 77 ǧǸȶ 055635 dated April 20, 2015) Ɣ Underground parking space ȶ 19 – freehold (ownership certificate 77 ǧǸȶ 055480 dated April 24, 2015) Ɣ Underground parking space ȶ 20 – freehold (ownership certificate 77 ǧǸȶ 056246 dated April 24, 2015) Ɣ Underground parking space ȶ 21 – freehold (ownership certificate 77 ǧǸȶ 055306 dated April 24, 2015) Ɣ Underground parking space ȶ 22 – freehold (ownership certificate 77 ǧǸȶ 055307 dated April 24, 2015) Ɣ Land plot – long-term lease (ȶǳ - 01-039326 dated December 14, 2012 )

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Terms and Reversion Method and Comparative Method were applied. considerations Terms and Reversion Method considerations: Average rental rate (Terms /Reversion period), rubles per sqm p.a.: 49,369; Caprate (Terms /Reversion period): 10%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The adjustment based on the market data were used to determine the Value.

Valuation date December 31, 2017.

Inspection date December 28, 2016.

Market value 1,217,522,000 RUB

46. Davydkovskaya

Property type Operating office

Address 16, Davidkovskaya St., Moscow

Location

Davydkovskaya

The Subject property is located in Fili-Davydkovo, Western Administrative district. The property has beneficial location in terms of convenient pedestrian and transport access. Slavyansky boulevard metro station is located at the distance of 0,5 km from the property, an access to the property is provided by Davidkovskaya street from Kutuzovsky Avenue. The surrounding area has a mix of administrative and business properties and residential area. The site is situated at environmentally pristine without any industrial plants. In view the whole advantages listed above, the location of the subject property can be classified as fair.

Image 90 Image 91

Description Office premises are located at the first floor and the basement of the residential complex. The premises have a cabinet-type layout. The site is fully fit out and serviced with requisite equipment for office premises – climate control, safety control system, uninterruptable power and etc. The territory near the Property is fenced; there is an above ground parking lot. Building’s walls are made from reinforced concrete and bricks, façade is stone facing and painting, window frame is plastic extrusions, floor – linoleum, parquet.

Stage of development Completed

Development Hold strategy

Areas Ɣ Total area of the building – 1,808 sqm; Ɣ Leasable commercial premises – 1,737.2 sqm; Ɣ Underground parking – 6 parking spaces; Ɣ Land plot – 1.14 hectares

Tenure Ɣ Part of the total area of the property is 3.7 - freehold (ownership certificate 77 ǧǷ 619732 dated June, 25, 2014); Ɣ Part of the total area of the property is 406.1 - freehold (ownership certificate 77 ǧǷ 619733 dated June 25, 2014); Ɣ Part of the total area of the property is 342.2 - freehold (ownership certificate 77 ǧǷ 619734 dated June 25, 2014); Ɣ Part of the total area of the property is 273.3 - freehold (ownership certificate 77 ǧǷ 619735 dated June 25, 2014); Ɣ Part of the total area of the property is 308.4 - freehold (ownership certificate 77 ǧǷ 619736 dated June 25, 2014); Ɣ Part of the total area of the property is 403.5 - freehold (ownership certificate 77 ǧǷ 619737 dated June 25, 2014); Ɣ Underground parking space ȶ 136 - freehold (ownership certificate 77 ǧǷ 619727 dated June 25, 2014); Ɣ Underground parking space ȶ 134 - freehold (ownership certificate 77 ǧǷ 619728 dated June 18, 2014); Ɣ Underground parking space ȶ 133 - freehold (ownership certificate 77 ǧǷ 619729 dated June 18, 2014); Ɣ Underground parking space ȶ 132 - freehold (ownership certificate 77 ǧǷ 619730 dated June 18, 2014); Ɣ Underground parking space ȶ 135 - freehold (ownership certificate 77 ǧǷ 619731 dated June 18, 2014); Ɣ Underground parking space ȶ 23 - freehold (ownership certificate 78 ǧǷ 619738 dated June 25, 2014).

Tenancies At the valuation date all the premises of the Property are leased by the companies affiliated with LSR Group.

Valuation Direct Capitalization Method and Comparative Method were applied. considerations Direct Capitalization Method considerations:

Average rental rate (triple net), rubles per sqm p.a.: 11,735; Caprate: 11.5%; Comparative Method considerations: Comparative method was based on the data of offers of comparable subjects. The adjustment based on the market data were used to determine the Value.

Valuation date December 31, 2017.

Inspection date December 24, 2017.

Market value 235,114, 000 RUB

47. Rassvetny

Property type Mass market residential

Address 2B, 40-Letiya Komsomola Street, Kirovsky administrative district, Yekaterinburg

Location

The subject property is located near the center of Yekaterinburg city at the JBI sub district, on the corner of Siromolotova and Rassvetnaya streets. The ecological situation in the district is assumed to be good. There is a forest park Kamennye palatki near the area, Lake Shartash only in 1 km from the property. The area has a developed infrastructure: schools, clinic, food-markets, post office, shopping centers, banks and pharmacy. The distance to the city center is approximately 5.1 km. Developed transport system connects the area with the city through 4 highways (Malysheva, Komsomol’skaya, Shefskaya streets and Sibirskiy Trakt). The main highway of the district is Siromolotova street which provides residents with public transport (buses, trams, taxis). Surroundings are mainly presented by parking, supermarkets, tram deport, stadium at the distance of 300 meters and a big supermarket and shopping center in 750 meters.

Image 92 Image 93 Description Economy class residential complex of 5 residential buildings (precast concrete) that are 25/26 floors in height. The residential complex area includes green zones, playgrounds, kindergarten and car parking for 336 parking lots. Residential complex consists of 2,907 residential premises

that are fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The beginning of the construction – 2014 year. Scheduled completion date – 2018 year. Current condition: Ɣ Houses 1, 2, 3, 4 – put into operation; Ɣ House 5 – construction.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 208,583 sqm Ɣ NSA (excluding parking)– 145,043 sqm; Ɣ Residential premises area – 144,963 sqm Ɣ Other premises – 81 sqm Ɣ Parking – 352 parking lots/ 1,654 sqm; Ɣ Available residential premises area – 1,921 sqm; Ɣ Available other premises – 46 sqm Ɣ Available parking lots – 237 parking lots. Ɣ Land plot – 8.7491 hectares (~ 7 contiguous land plots with a total area of 87,491 sqm)

Tenure Freehold on the land plots: Ɣ Land plot of 11,537 sqm, ownership certificate 66ǧǭ 407691 dated April 16, 2014; Ɣ Land plot of 13,313 sqm, ownership certificate 66ǧǭ 500975 dated June 06, 2014; Ɣ Land plot of 5,774 sqm, ownership certificate 66ǧǭ 503212 dated August 06, 2014; Ɣ Land plot of 50 sqm, ownership certificate n/a (registration ȶ66-66/001-66/001/459/2015- 800/1) dated December 15, 2015; Ɣ Land plot of 21,722 sqm, ownership certificate 426606 dated March 15, 2016; Ɣ Land plot of 3,245 sqm, ownership certificate 426605 dated March 15, 2016; Ɣ Land plot of 31,850 sqm, ownership certificate 426510 dated March 15, 2016

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: February 2014/ February 2018; Ɣ Sales start/completion dates: June 2014/ September 2019; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 130,543,000 RUB; Ɣ Prices per sqm or parking unit: residential: 61,448 RUB, other premises: 33,114 sqm; parking unit: 299,619; Ɣ Estimated Revenue: 476,580,000 (including 286,005,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 15.56%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 330,442,000 RUB

48. Khrustalniye Klyuchi

Property type Mass market residential

Address Latviyskaya St, Yekaterinburg

Location

The subject property is located in the east of Yekaterinburg at the Kompressornyi sub district at Latviiskaya street, near the Ring Road (EKAD). The distance to the city center is about 11,7 km. The ecological situation in the district is close to perfect, there is a big forest on the one side of the area. The district has a developed infrastructure: schools, clinic, food-markets, post-office, shopping centers, banks and pharmacy. The district is connected with the center of the city through three roads (Sibirskiy trakt, Kolcovskiy trakt, Alternate of Sibirskiy trakt). The Latviiskaya street is connected with one of the main highways which provides residents with a good transport accessibility. Moreover, aeroexpress can be used to reach the center of the city from the district. Surroundings are mainly presented by forest on the south, shops, clinic and police department at the distance of few hundred meters.

Image 94 Image 95 Description Economy class residential complex of 6 residential buildings (precast concrete) that are 12/25 floors in height. The residential complex area includes green zones, playgrounds and kindergarten. There are cafes, shops and banks on the ground floor of the subject property. Residential complex consists of 4,300 residential premises that are fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door) office and other premises. The beginning of the construction – 2014 year. Scheduled completion date – 2024 year. Current condition: Ɣ House 1, 4A, 4Ǩ – put into operation; Ɣ House 6ǧ, 6Ǩ, 6ǩ – construction works; Ɣ Other houses – designing.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 289,661 sqm; Ɣ Total NSA– 224,401 sqm; Ɣ Residential premises area – 220,907 sqm; Ɣ Office area – 897 sqm; Ɣ Other premises –2,597 sqm; Ɣ Available residential premises area – 168,446 sqm; Ɣ Available office area – 179 sqm; Ɣ Available other premises area – 2,160 sqm; Ɣ Land plot – 11.0197 hectares (~ land plot with a total area of 110,197 sqm)

Tenure Leasehold for the land plot until the May 25, 2022 (Lease Agreement # 6-1307-T dated May 25, 2012 as amended by Addendum dated October 29, 2014)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: April 2014/ September 2024;

Ɣ Sales start/completion dates: October 2014/ September 2024;

Ɣ Number of phases: 4;

Ɣ Estimated costs after the valuation date: 6,392,558,000 RUB;

Ɣ Prices per sqm or parking unit: residential: 52,463 RUB; office premises: 43,000 RUB, other premises: 25,000 RUB;

Ɣ Estimated Revenue: 9,025,084,000 RUB (including 126,121,000 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 17.29%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 562,208,000 RUB

49. Michurinskiy

Property type Mass market residential

Address Between Landau, Ekaterininskaya, Vavilova (Syhodol’skaya) streets, Verh-Isetskiy administrative district, Yekaterinburg

Location

The subject property is located in the west of Yekaterinburg city at the Shirokaya Rechka sub district between Landay, Ekaterininskaya, Vavilova (Syhodol’skaya) streets near the EKAD. The ecological situation in the district is close to perfect (forest and lake near the area). There are shopping malls such as OBI, IKEA, Ashan, METRO nearby. The transport accessibility of the subject property is satisfactory. The distance to the city center is approximately 10 km, to the Ring Road (EKAD) about 4 km. Now the project of improvement of the transport accessibility of the district is developed. This will help to connect the area with EKAD and sub district Academicheskiy which is one of the most dynamic growing districts of the city. Surroundings are mainly presented by green zone (mainly forests).

Image 96 Image 97 Description Comfort class residential complex of 70 residential buildings (precast concrete) that are 3/4 floors in height. The residential complex area includes green zones, playgrounds, kindergarten, office rooms and three-level parking (594 parking lots). Residential premises of residential complex are fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The beginning of the construction – 2012 year. Scheduled completion date – 2022 year. Current condition: Ɣ First stage of the construction (32 houses) – put into operation; Ɣ Second stage of construction, houses 33-42 – put into operation; Ɣ Second stage of construction – designing and construction

Stage of development Construction

Areas Ɣ Total buildings area – 346,427 sqm;

Ɣ Total NSA– 270,642 sqm;

Ɣ Residential premises area – 269,591 sqm;

Ɣ Office area – 572 sqm;

Ɣ Other premises area – 479 sqm;

Ɣ Parking – 299 parking lots (ground level parking);

Ɣ Available residential premises area – 120,517 sqm;

Ɣ Available office area – 276 sqm;

Ɣ Available other premises area – 260 sqm;

Ɣ Available parking lots – 267;

Ɣ Land plot – total area of the land plot in accordance with information provided by the Client – 50.9424 hectares, currently 52 land plots with a total area of 46.8518 hectares are held freehold

Tenure Freehold on the land plots: Ɣ Land plot of 2,756 sqm, ownership certificate 66ǧǭ 880745 dated December 31, 2014; Ɣ Land plot of 30,336 sqm, ownership certificate 66ǧǭ 880746 dated December 31, 2014; Ɣ Land plot of 34,035 sqm, ownership certificate 66ǧǭ 880747 dated December 31, 2014;

Ɣ Land plot of 5,652 sqm, ownership certificate 66ǧǭ 880748 dated December 31, 2014; Ɣ Land plot of 204 sqm, ownership certificate 66ǧǭ 880749 dated December 31, 2014; Ɣ Land plot of 401 sqm, ownership certificate 66ǧǭ 880750 dated December 31, 2014; Ɣ Land plot of 29,100 sqm, ownership certificate 66ǧǭ 880751 dated December 31, 2014; Ɣ Land plot of 11,946 sqm, ownership certificate 66ǧǭ 880752 dated December 31, 2014; Ɣ Land plot of 17,986 sqm, ownership certificate 66ǧǭ 880753 dated December 31, 2014; Ɣ Land plot of 2,262 sqm, ownership certificate 66ǧǭ 880754 dated December 31, 2014; Ɣ Land plot of 18,864 sqm, ownership certificate 66ǧǭ 880755 dated December 31, 2014; Ɣ Land plot of 22,227 sqm, ownership certificate 66ǧǭ 880756 dated December 31, 2014; Ɣ Land plot of 3,208 sqm, ownership certificate 66ǧǭ 880757 dated December 31, 2014; Ɣ Land plot of 47,177 sqm, ownership certificate 66ǧǭ 880758 dated December 31, 2014; Ɣ Land plot of 1,797 sqm, ownership certificate 66ǧǭ 880759 dated December 31, 2014; Ɣ Land plot of 3,142 sqm, ownership certificate 66ǧǭ 875257 dated February 10, 2015; Ɣ Land plot of 3,632 sqm, ownership certificate 66ǧǭ 875258 dated February 10, 2015; Ɣ Land plot of 1,744 sqm, ownership certificate 66ǧǭ 875259 dated February 10, 2015; Ɣ Land plot of 2,366 sqm, ownership certificate 66ǧǭ 875260 dated February 10, 2015; Ɣ Land plot of 21,590 sqm, ownership certificate 66ǧǭ 875261 dated February 10, 2015; Ɣ Land plot of 4,580 sqm, ownership certificate 66ǧǬ 576211 dated October 08, 2012; Ɣ Land plot of 24,958 sqm, ownership certificate 66ǧǬ 907355 dated May 13, 2013; Ɣ Land plot of 52 sqm, ownership certificate 66ǧǬ 907356 dated May 13, 2013; Ɣ Land plot of 25,415 sqm, ownership certificate 66ǧǬ 907359 dated May 13, 2013; Ɣ Land plot of 18,328 sqm, ownership certificate 66ǧǭ 138385 dated September 26, 2013; Ɣ Land plot of 1,445 sqm, ownership certificate 66ǧǭ 138403 dated September 26, 2013; Ɣ Land plot of 21,621 sqm, ownership certificate 66ǧǭ 138468 dated September 26, 2013; Ɣ Land plot of 11,373 sqm, ownership certificate 66ǧǭ 138439 dated September 26, 2013; Ɣ Land plot of 2,542 sqm, ownership certificate 66ǧǭ 138458 dated September 26, 2013; Ɣ Land plot of 205 sqm, ownership certificate 66ǧǭ 138245 dated September 26, 2013; Ɣ Land plot of 328 sqm, ownership certificate 66ǧǭ 138386 dated September 26, 2013; Ɣ Land plot of 8,651 sqm, ownership certificate 66ǧǭ 138387 dated September 26, 2013; Ɣ Land plot of 5,774 sqm, ownership certificate 66ǧǭ 138404 dated September 26, 2013; Ɣ Land plot of 8,046 sqm, ownership certificate 66ǧǭ 410749 dated March 24, 2014; Ɣ Land plot of 6,134 sqm, ownership certificate 66ǧǭ 410748 dated March 24, 2014; Ɣ Land plot of 7,046 sqm, ownership certificate 66ǧǭ 596373 dated June 27, 2014; Ɣ Land plot of 34,480 sqm, ownership certificate 66ǧǭ 596374 dated June 27, 2014; Ɣ Land plot of 125 sqm, ownership certificate 66ǧǭ 502980 dated August 01, 2014; Ɣ Land plot of 12,142 sqm, ownership certificate 66ǧǭ 503063 dated August 01, 2014; Ɣ Land plot of 407sqm, ownership certificate 66-66/001-66/001/396/2015-294/1 dated July 14, 2015; Ɣ Land plot of 406 sqm, ownership certificate 66-66/001-66/001/396/2015-295/1 dated July 14, 2015; Ɣ Land plot of 239 sqm, ownership certificate 66-66/001-66/001/396/2015-296/1 dated July 14, 2015; Ɣ Land plot of 200 sqm, ownership certificate 66-66/001-66/001/396/2015-297/1 dated July 14, 2015; Ɣ Land plot of 311 sqm, ownership certificate 66-66/001-66/001/396/2015-298/1 dated July 14,

2015; Ɣ Land plot of 208 sqm, ownership certificate 66-66/001-66/001/396/2015-299/1 dated July 14, 2015; Ɣ Land plot of 221 sqm, ownership certificate 66-66/001-66/001/396/2015-300/1 dated July 14, 2015; Ɣ Land plot of 228 sqm, ownership certificate 66-66/001-66/001/396/2015-301/1 dated July 14, 2015; Ɣ Land plot of 214 sqm, ownership certificate 66-66/001-66/001/396/2015-302/1 dated July 14, 2015; Ɣ Land plot of 203 sqm, ownership certificate 66-66/001-66/001/396/2015-303/1 dated July 14, 2015; Ɣ Land plot of 6,344 sqm, ownership certificate 66ǧǭ 650028 dated September 24, 2014; Ɣ Land plot of 147 sqm, ownership certificate 66-66/001-66/001/472/2015-680/1 dated December 15, 2015; Ɣ Land plot of 5,720 sqm, ownership certificate 66-66/001-66/001/472/2015-679/1 dated December 15, 2015.

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: November 2012/ December 2022; Ɣ Sales start/completion dates: March 2013/ December 2022; Ɣ Number of phases: 2; Ɣ Estimated costs after the valuation date: 4,588,579,000 RUB; Ɣ Prices per sqm or parking unit: residential 55,547 RUB; office premises: 65,000 RUB; other premises: 25,000 RUB; parking: 300,000 RUB; Ɣ Estimated Revenue: 7,025,212,000 RUB (including 226,353,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.79%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 1,054,929,000 RUB

50. Rastochnaya

Property type Mass market residential

Address 31a, Rastochnaya Street, Zheleznodorozhniy administrative district, Yekaterinburg

Location

The subject property is located in the Yekaterinburg city at the Staraya Sortirovka sub district between Rastochnaya, Kynarskaya, Kishinevskaya and Bilimbaevskaya streets. The ecological situation in the district is formed by the near railways and sort facilities. The distance to the city center is approximately 7 km. The subject property is mainly surrounded by the old houses of 2-5 floors in height But currently the area of the district is dynamically developing. New residential complexes are constructing nearby. There are schools, kindergartens, stadium, fitness center and shops as well as public parking, car showroom near the subject property. Transport system is well developed and provides citizens with good services of public transport (buses, trams, taxis, bus stop in 120 meters).

Image 98 Image 99 Description Economy class residential complex of 1 residential building (precast concrete) that is 25 floors in

height. The residential complex area includes 275 residential premises. Residential premises of the residential complex will be fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The beginning of the construction – 2016 year. Scheduled completion date – 2018 year. Current condition: construction

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 19,541 sqm; Ɣ Total NSA– 14,027 sqm; Ɣ Residential premises area – 14,027 sqm; Ɣ Available residential premises area – 5,183 sqm; Ɣ Land plot – 0.5385 hectares

Tenure Freehold on the land plot of 5,385 sqm according to the Ownership certificate number 66ǧǭ 274963 dated December 16, 2013

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: June 2016/ June 2018;

Ɣ Sales start/completion dates: June 2016/ July 2018;

Ɣ Number of phases: 1;

Ɣ Estimated costs after the valuation date: 52,066,000 RUB;

Ɣ Prices per sqm or parking unit: residential: 51,845 RUB;

Ɣ Estimated Revenue: 352,326,000 RUB (including 83,616,000 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 14.33%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 325,322,000 RUB

51. Academichesky

Property type Mass market residential

Address Verkhneuphaleyskaya St, Yekaterinburg

Location

The subject property is located in the west of Ekaterinburg city at the Shirokaya Rechka sub district, near the intersection of Evgeniya Savkova, Syhodol’skaya and Rucheinaya streets. The ecological situation in the district is close to perfect (forest and lake near the area). There are shopping malls such as OBI, IKEA, Ashan, METRO nearby. The transport accessibility of the subject property is satisfactory. The distance to the city center is approximately 9 km, to the Ring Road (EKAD) about 3.5 km. Now the project of improvement of the transport accessibility of the district is developed. This will help to connect the area with EKAD and sub district Academicheskiy which is one of the most dynamic growing districts of the city. Surroundings are presented by green zone and houses of Academicheskiy residential area that are 10 floors and more in height. There are warehouse complex Malahit, residential complexes Khrustal’nogorskiy and Suhodolskiy kvartal near the subject property.

Image 100 Image 101 Description Economy class residential complex of residential buildings (precast concrete) that are 7-25 floors in height. The residential complex area includes green zones, playgrounds and parking (600 parking lots). Flats of residential complex are fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The projected beginning of the construction – 2017 year. Scheduled completion date – 2025 year.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 292,002 sqm; Ɣ Total NSA – 211,314 sqm; Ɣ Residential premises area – 196,336 sqm; Ɣ Commercial premises – 8,151 sqm; Ɣ Other premises – 6,828 sqm; Ɣ Parking – 600 parking lots; Ɣ Available flats area – 188,101 sqm; Ɣ Available commercial premises – 8,103 sqm; Ɣ Available other premises – 6,761 sqm; Ɣ Available parking lots – 600; Ɣ Land plot – total area of the land plot in accordance with information provided by the Client – 13 hectares, currently 11 land plots with a total area of 13.46 hectares are held freehold

Tenure Ɣ Land plot of 4628 sqm, ownership certificate 563623 dated July 11, 2016; Ɣ Land plot of 16138 sqm, ownership certificate 563624 dated July 11, 2016; Ɣ Land plot of 5287 sqm, ownership certificate 563625 dated July 11, 2016; Ɣ Land plot of 2468 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 12768 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 5124 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 4052 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 1306 sqm, Extract from the Unified State Register of the Real Estate Property

dated January 12, 2017; Ɣ Land plot of 16248 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 6274 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017; Ɣ Land plot of 27738 sqm, Extract from the Unified State Register of the Real Estate Property dated January 12, 2017.

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: June 2017/ September 2025; Ɣ Sales start/completion dates: June 2017/ December 2025; Ɣ Number of phases: 4; Ɣ Estimated costs after the valuation date: 8,550,611,000 RUB; Ɣ Prices per sqm or parking unit: residential: 52,916 RUB; office premises: 50,000 RUB; other premises: 27,665 RUB; parking: 300,000 RUB; Ɣ Estimated Revenue: 10,946,466,000 RUB (including 220,780,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 18.4%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 578,853,000 RUB

52. Flagman

Property type Comfort class residential

Address between Repina, N.Vasil’eva, Zavodskaya streets, Verh-Isetskiy administrative district, Yekaterinburg

Location

The subject property is located in the Yekaterinburg at the VIZ sub district between Repina, N.Vasil’eva and Zavodskaya streets. The distance to the city center is approximately 3 km. The ecological situation in the district is deemed to be good. There are no big factories in the nearest area. The subject property is mainly surrounded by roads. It is situated near the crossroads of Gurzufskaya, Repina and Metallurgov streets – the main highways of the districts which connect west and south of the city with the center. So the transport system is well developed and provides residents with good services of private and public transport (mainly buses, but also trams at some distance). Surroundings are mainly presented by houses that are 5 floors in height, food-shops, schools, pharmacies. There are schools, kindergartens, hospital, parks, cafes, restaurants and shopping mall close to the area.

Image 102 Image 103 Description Comfort class residential complex of 4 residential buildings (precast concrete) that are 12-25 floors in height (with commercial premises at the ground floor). The residential complex area includes 1,023 residential premises, commercial premises and underground parking (515 parking lots). Residential premises of residential complex will be fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The beginning of the construction – 2015 year. Scheduled completion date – 2020 year. Current condition: Ɣ Houses 1, 3ǧǨǩ, 3Ǫǫ – put into operation;

Ɣ Houses 2, 3Ǭǭ – construction works.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 137,189 sqm; Ɣ Total NSA– 92,824 sqm; Ɣ Residential premises area – 88,688 sqm; Ɣ Office area – 3,987 sqm; Ɣ Other premises – 149 sq.m; Ɣ Parking – 465 parking lots (underground parking); Ɣ Available residential premises area – 45,753 sqm; Ɣ Available office area – 1,966 sqm; Ɣ Available other area – 64 sqm; Ɣ Available parking lots – 277; Ɣ Land plot – total area of the land plot in accordance with information provided by the Client – 3.3884, currently 5 land plots with a total area of 28.292 hectares are held freehold

Tenure Freehold on the land plots: Ɣ Land plot of 23,261 sqm, ownership certificate number 66ǧǭ 877020 dated February 20, 2015; Ɣ Land plot of 48.42 sqm, ownership certificate number 66ǧǭ 877021 dated February 20, 2015; Ɣ Land plot of 48 sqm, ownership certificate number 66ǧǭ 877022 dated February 20, 2015; Ɣ Land plot of 4007 sqm, Extract from the Unified State Register of the Real Estate Property dated Desember 01, 2016;

Ɣ Land plot of 928 sqm, ownership certificate number 66ǧǬ 597658 dated September 14, 2012 (the land plot is not identified at the Public cadastral map).

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: April 2015/ December 2020; Ɣ Sales start/completion dates: May 2015/ December 2020; Ɣ Number of phases: 2; Ɣ Estimated costs after the valuation date: 2,202,825,000 RUB Ɣ Prices per sqm or parking unit: residential: 68,075 RUB; other – 24,814; commercial: 72,530 RUB; parking: 490,000 RUB. Ɣ Estimated Revenue: 3,842,283,000 RUB (including 447,729,000 RUB for bargains before December 31, 2017); Ɣ Discount Rate: 16.06%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 1,068,988,000 RUB

53. VIZ

Property type Mass market residential

Address 700 m to the South-East of the tram ring at the Bolshoy Konniy Peninsula, Verh-Isetskiy administrative district, Yekaterinburg

Location

The subject property is located in the west of Ekaterinburg city at the VIZ (Vizovskiy) sub district, at the territory of Bolshoy Konniy Peninsula. The ecological situation in the district is close to perfect (forest and lake near the area). The transport accessibility of the subject property is satisfactory. The distance to the city center is approximately 7 km, to the Ring Road (EKAD) about 2 km. The road to the subject property has no name, has two lines traffic, one line to each way. The nearest big road is Metallurgov Street and Novo-Moskovskiy tract (about 2 km on the straight) which connect eastern suburbs with a city center, but there is no direct access to these roads at the valuation date. Surroundings are presented by green zone and private residential buildings. The industrial and warehouse buildings of company Sportobuv (footwear production) are located at a distance of approximately 700 m. There was a development scheme of the EXPO 2025 complex construction at the territory of the subject property and its surroundings. The development scheme proposed the construction of large expocenter and high rise residential complex with all necessary infrastructure including construction of a bridge connecting the Bolshoy Konniy Peninsula and Sortirovka sub district at the north of the city. Now there is no actual information in this regard. The only one public transport link (200 m) is tramline which leads to the station VIZ near the city center. The territory of VIZ sub district is supposed to be one of the dynamically growing districts in

terms of residential construction. The yacht club Komatak night club and beach Kuba are located nearby. Nevertheless, the absence of any infrastructure and transport links near the subject property negatively influence the attractiveness of the subject property location.

Image 104 Image 105 Description The subject property is a multifunctional residential development complex located on a 14.2962 hectares of land plots. Under the proposed development the project will comprise an economy class residential complex with parking (1,200 parking lots). Residential premises of residential complex will be fully fitted out. The proposed beginning of the construction – 2018 year. Scheduled completion date – 2025 year.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 245,722 sqm; Ɣ Total NSA– 150,000 sqm; Ɣ Residential premises area – 150,000 sqm; Ɣ Parking – 1,200 parking lots; Ɣ Available residential premises area – 150,000 sqm; Ɣ Available parking lots – 1,200; Ɣ Land plot – 14.2962 hectares

Tenure Land plot of 142,962 sqm (cadastral number 66:41:0305021:3) is held freehold, ownership certificate 512609 dated June 02, 2016.

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: January 2019/ December 2025;

Ɣ Sales start/completion dates: April 2019/ December 2025;

Ɣ Number of phases: 1;

Ɣ Estimated costs after the valuation date: 6,412,966,000 RUB;

Ɣ Prices per sqm or parking unit: residential: 60,000 RUB; parking: 350,000 RUB.

Ɣ Estimated Revenue: 9,420,000 RUB;

Ɣ Discount Rate: 19.17%

Valuation date December 31, 2017.

Inspection date January 15, 2018

Market value 940,775,000 RUB

54. Tsvetnoy Bulvar (Blyukhera)

Property type Mass market residential

Address Danily Zvereva Street (at the intersection of Danily Zvereva, Sulimova and Blyukhera streets), Kirovskiy administrative district, Yekaterinburg

Location

The subject property is located to the North-East of Ekaterinburg city at the Pionerskiy sub district (Kirovskiy district), at the intersection of Danily Zvereva, Sulimova and Blyukhera streets. The ecological situation in the district is close to perfect (forest and lake near the area). There are shopping malls such as Park House, Aida nearby. The transport accessibility of the subject property is satisfactory. The distance to the city center is approximately 5 km, to the Ring Road (EKAD) about 1.7 km. Blyukhera street which passes along the southeast border of the subject property is one of the main transport links of the district which leads directly to the Prospect Lenina (one of the main streets of the city center). The Blyukhera Street as well as Danily Zvereva, Sulimova streets has two-ways traffic, two lines to each way. The tramway runs along the Blyukhera street. Surroundings are mainly presented by residential buildings of 1960-1970 construction years. The construction of new residential complex Avangard (Danily Zvereva Street) is carried out by company Atomstroycomplex. The lake Shartash and forest Shartashskiy (777 ha) are located at a distance of approximately 2 km from the property which provides citizens with bicycle and foot paths in the summer and ski tracks in the winter. Thus the location of the subject property may be described as attractive because of the proximity to the city center, lake Shartash and forest of the same name.

Image 106 Image 107 Description The subject property is a multifunctional residential development complex located on a 6.0536 hectares of land plots. Under the proposed development the project will comprise an comfort class residential complex with parking (900 parking lots). Residential premises of residential complex will be fully fitted out. The beginning of the construction – 2017. Scheduled completion date – 2023 year.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 181,629 sqm; Ɣ Total NSA– 133,832 sqm; Ɣ Residential premises area – 127,459 sqm; Ɣ Office area – 3,582 sqm; Ɣ Other area – 2,791 sqm; Ɣ Parking – 1,297 parking lots; Ɣ Available residential premises area – 119,531 sqm; Ɣ Available office area – 3,582 sqm; Ɣ Available other area – 6,681 sqm; Ɣ Available parking lots – 1,297; Ɣ Land plot – 6.0536 hectares

Tenure Land plot of 60,536 sqm (cadastral number 66:41:0702069:1903) is held freehold, ownership certificate 418292 dated March 25, 2016

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: August 2017/December 2023; Ɣ Sales start/completion dates: September 2017/ December 2023; Ɣ Number of phases: 2; Ɣ Estimated costs after the valuation date: 5,985,374,000 RUB; Ɣ Prices per sqm or parking unit: residential: 63,606 RUB; other – 25,000 RUB; commercial: 75,000 RUB; parking: 350,000 RUB. Ɣ Estimated Revenue: 8,490,100,000 RUB (including 97,538,000 RUB for bargains before December 31, 2017);

Ɣ Discount Rate: 19.17%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 879,247,000 RUB

55. Shefskaya

Property type Mass market residential

Address 11, Shefskaya St, Yekaterinburg

Location

Shefskaya

The subject property is located in the north of the Yekaterinburg city at the Elmash sub district near the 108, Shefskaya street. The distance to the city center is approximately 6 km. The ecological situation in the district is assumed to be good: Kalinovskie rezrezy, forest and parks are close to the area. There are schools, kindergartens, hospital, parks, cafes, restaurants and shopping malls near the subject property. However there are small industry zone at the distance of approximately 0,5 km and big industry zone (turbine plant, electric locomotive plant) at the distance of approximately 2,5 km from the subject property. The surroundings are mainly presented by new residential complexes such as Kalinovskiy, Oasis and etc., shopping centers, schools, pharmacies. The transport system is perfectly developed and provides residents with good services of public transport (few minutes to bus-stop, taxis, subway and trams (in the future)) and many road junctions that provide comfortable way to the EKAD, city-center and suburbs. The main road of the district is Prospect Kosmonavtov which is at the distance of about 500 m from the subject property.

Image 108 Image 109 Description Economy class residential complex of 2 residential buildings (precast concrete) that are 15-21 floors in height. The residential complex area includes 360 residential premises, other commercial premises and parking (153 parking lots). Residential premises of residential complex will be fully fitted out (laminate, vinyl wallpapers, ceiling – waterproof acrylic, MDF interior doors, safe entrance door). The beginning of the construction – 2015 year. Scheduled completion date – 2017 year.Current condition: completing of construction.

Stage of development Construction

Development Build and sell strategy

Areas Ɣ Total buildings area – 32,128 sqm; Ɣ Total NSA– 20,250 sqm; Ɣ Residential premises area – 20,045 sqm; Ɣ Other commercial premises area – 205 sqm; Ɣ Parking – 153 parking lots; Ɣ Available residential premises area – 2,708 sqm; Ɣ Available parking lots – 65; Ɣ Land plot – 1.7578 hectares

Tenure Freehold on the land plot, Ownership certificate number 66ǧǭ 968717 dated February 25, 2015

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: November 2015/ November 2017; Ɣ Sales start/completion dates: November 2015/ June 2019; Ɣ Number of phases: 1; Ɣ Estimated costs after the valuation date: 567,000 RUB; Ɣ Prices per sqm or parking unit: residential: 59,482 RUB; other premises: 25,000 RUB; parking: 438,620 RUB. Ɣ Estimated Revenue: 232,401,000 RUB (including 42,812,000 RUB for bargains before December 31, 2017);Discount Rate: 15.33%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 206,712,000 RUB

56. Voskhod

Property type Mass market residential

Address 25, Ul.40th anniversary of the Komsomol, Kirov district, Yekaterinburg

Location

The subject property is located in the eastern part of Ekaterinburg, in the Kirovsky district, in the JBI microdistrict. The ecological situation in the area is described by the following parameters: on the one hand, in the immediate vicinity are industrial and storage facilities, on the other - there are a lake and a forest nearby. The transport accessibility of the subject property is satisfactory. The distance to the city center is approximately 9 km, to the Ring Road (EKAD) about 7 km.The road to the subject property has no name, has two lines traffic, one line to each way. The nearest big road is ul. Vladimir Vysotsky and the Siberian route (about 1 km on the straight) which connect eastern suburbs with a city center. The surrounding environment is represented by residential buildings and production and storage facilities. The public transport stop is in the immediate vicinity of the Object. Next to the planned development in the future, it’s planned to develop a metro line between the areas VIZ - Center – JBI. Also in the Kirov administrative district are located some of the best universities in Ekaterinburg: UrFU, GU and UralUYU.

Image 110 Image 111 Description The structure of the object includes two multiple-storeyed houses (14-23 floors), Overground parking for 330 parking slots, as well as a well-organized house territory, which includes playgrounds and places for recreation of the residents of the complex. The developed social and trade infrastructure of the district make living in the complex very comfortable. In the immediate vicinity of the housing complex there are schools, kindergartens, sports halls for children and adults,

pharmacies, shops, cafes, and five minutes by car - polyclinics, a cinema and shopping centers. Transport accessibility meets the expectations of modern mobile customers and allows you to get to the city center in 20 minutes.

Stage of development Design

Development Build and sell strategy

Areas Ɣ Total buildings area – 47,479 sqm; Ɣ Total NSA – 33,990 sqm; Ɣ Residential premises area – 33,592 sqm; Ɣ Other premises – 398 sqm; Ɣ Parking – 330 parking lots; Ɣ Available residential premises area – 33,592 sqm; Ɣ Available other premises – 398 sqm; Ɣ Available parking lots – 330; Ɣ Land plot – 1,20 hectares

Tenure Freehold of the land plot (cadastral number 66: 41: 0705006: 011) with a total area of 11 970 sqm (Certificate of State Registration of Title 443668 dated 04/01/2016)

Valuation Ɣ Applied method(-s) of valuation: Residual (DCF); considerations Ɣ Construction start/completion dates: January 2018/ December 2019; Ɣ Sales start/completion dates: March 2018/ December 2020; Ɣ Number of phases: 2; Ɣ Estimated costs after the valuation date: 1,406,782,000 RUB Ɣ Prices per sqm or parking unit: residential: 58,012 RUB; other – 28,000 RUB; parking: 300,000 RUB. Ɣ Estimated Revenue: 2,058,899,000 RUB; Ɣ Discount Rate: 18.17%

Valuation date December 31, 2017

Inspection date January 15, 2018

Market value 307,294,000 RUB

The descriptions of 3 properties located in Germany are attached in Appendix 6.

Appendix 3 Market overview

Office market overview of St. Petersburg

Highlights x The level of vacant office space remained within 7-8% during the year 2017, going down less than 1 p. p. by the end of the year if compared to 2016. x The average asking rental rates demonstrated a steady increase. Class A business centres recorded the rental increase of 9%, Class B - 5% in the national currency at the end of 2017. x The take-up rates slowed down. The net take-up volume of 2017 amounted to 154,000 sq m - 29% less than in the previous year. x The total volume of lease transactions reached 120,000 sq m. The main demand for office space in 2017 was formed by IT and telecommunications spheres. This sector made a breakthrough by 25 p. p. in the share of premises leased for the year. x 112,000 sq m of leasable premises were purchased for investment purposes and for the company's own needs during 2017. The figure was comparable to the results of the office real estate market in 2016.

Table 4. Key indicators of office market as of 2017 Q4

Key Indicators. Dynamics* Class ǧ Class ǩ Total leasable area, thousand sq m 3,041 including, thousand sq m 1,005 2,036 Changes against the end of 2016, % 6% ଭ 4% ଭ New delivery in 2017, thousand sq m 143 including, thousand sq m 58 85 Total vacant stock, thousand sq m 231 ଯ including, thousand sq m 57 174 Vacancy rate, % 5.7 ଭ 8.5 ଯ Asking rental rates in operating business centres, $/sq m/month, incl. 242–380 121–311 OPEX, net of VAT (18%) Average asset-by-asset change of the rent in rubles in operating ଭ 11 ଭ 6 business centres, % *Comparison with Q4 2016 results

Source: Knight Frank St. Petersburg Research, 2018

Key events: x The brightest event in the office market of St. Petersburg in 2017 was the trend of investment activity renewal, which was outlined in 2016. More than 10 purchase transactions of business centres were concluded over the year. The largest acquired business centres were Kellermann Center and Premium, which Raven Russia investment fund added to its asset portfolio; Aeroplaza, bought by Jensen Group; and Senator at 36, embankment of Moyka river, which expanded the office real estate chain of Imperia Financial and Holding Company.

x IT companies demonstrated the highest performance - the share of IT and telecommunications transactions in the overall structure of lease transactions in 2017 was 53%, while the share of oil and gas sector was significantly reduced till the level of 17% for the first time since 2013. x All transactions with an area of more than 5,000 sq m were completed either with the participation of IT companies or oil and gas companies. The Russian company Peter-Service, which developed solutions for the telecommunications business, leased 9,300 sq m in Smolensky business centre on Vasilievsky island and two IT companies were also accommodated in Megapark at 22, Zastavskaya. x The purchase of the buildings of Lotos Tower multifunctional complex on Primorsky Avenue confirmed the high activity of IT and telecommunications sector on the office real estate market. The international company JetBrains, which created professional software development tools, bought two buildings to reconstruct them for office use and accommodation of its employees, which would expand the company's presence in St. Petersburg. x In 2017, it was reported that the construction project of a multifunctional office and shopping complex Sky City on the embankment of Obvodny channel was sold to Chinese investors. A new permit for the construction of the complex was issued in November of last year.

The shortfall of quality office space became more and more apparent by the end of 2017 - there were cases when several clients put a claim for vacated premises and the landlord could choose the most interesting tenant for himself. The situation became more difficult for large customers: landlords of vacated space preferred not to wait for large tenants with their long-standing decision-making and approval processes, but divided the premises into smaller units and quickly let them. In this context, there was no significant rents increase observed, as tenants were still optimizing their costs, and the rent size was the main parameter in choosing an office. In 2018, we do not expect major changes: the rotation of tenants will continue, low delivery volume of new facilities will only partially meet the pent-up demand. Herewith, the choice will be very modest for discerning tenants wishing to move to the property of the highest quality: most of the newly constructed facilities intended for the lease market belong to Class B properties according to their characteristics.

Supply

The total leasable area of quality offices in St. Petersburg exceeded the figure of 3 million sq m following the results of 2017. Its 5% increase was ensured by the delivery of more than 20 business centres in 2017, with about half of all facilities being built from scratch, while the rest approached the market after reconstruction.

The volume of offices entering the market in 2017 reached 143,000 sq m - an all-time low figure for 10 years, less by 41% than in 2016. A similar decrease occurred in 2010 due to developers’ activity drop in 2008-2009 and the excess of supply that existed for some time. However, more than 85% of new quality offices replenished the open lease market, and a third of new business centres enjoyed an occupancy rate of over 80% for the year.

The maximum quality supply volume in functioning business centres was concentrated in Moskovsky and Central districts. Whereas, Frunzensky, Kirovsky and Pushkinsky districts were least supplied with offices. Their total share did not exceed 6% of the total volume of premises for lease in St. Petersburg.

Chart 1. Delivery dynamics by classes against the previous period, %

Source: Knight Frank St Petersburg, 2018

Demand

The total net take-up amounted to 154,000 sq m by the end of the year - 29% lower than the similar level last year. It distributed in the districts the following way: Embankments with views business district strengthened its leadership position, which was adopted already in H1 2017. This was due to the high occupancy level of several facilities that rose during the year, as well as the commissioning of a new business centre Renaissance Business Park, fully leased by Gazprom-pererabotka already at the construction stage.

Remarkably, North-Western business district (district where Lakhta Center was to be accommodated) was also gradually gaining popularity: the take-up rate grew by 19.3 p. p. during the year.

At the end of the year, 231,000 sq m of office space remained vacant at the market, and most of them belonged to Class B (75%). During the year, the number of vacant Class A premises increased by 10%, which was the result of the entry of several quality properties to the market. This entry did not result in the reduction of the existing shortage of Class A premises. The office market responded to the lack of Class A offices by the decrease in vacant Class B premises by 7.8% compared to the same period in 2016. However, this decrease was not as large as it could have been expected: new supply in quite attractive locations for tenants had a chance to

be fully or partially taken up, but there were a number of Class B facilities that had problems with occupancy due to the peripheral location or inappropriate lease terms.

Chart 2. Distribution of the total volume and vacant office space by business districts in 2017, %

Source: Knight Frank St Petersburg, 2018

The total volume of lease transactions came up to 120,000 sq m, which was 45% less than in the same period last year. In general, there was a decrease in the average leased area by 39% in 2017 against 2016 results, the drop mainly occurred in Class A properties, where the average transaction size was the lowest for the last 5 years. The sphere of IT and telecommunications became the leader of tenants' activity in terms of the volume of leased space - 53%. In quantitative terms, about 30% of transactions were completed by the participants of this profile, while the average area of offices leased by IT companies was 73% higher than the market average. In 2017, oil and gas companies stopped dominating in the lease transactions - their share was reduced by 39 p. p.

Chart 3. Distribution of lease transactions by area depending on tenant profile, %

Source: Knight Frank St Petersburg, 2018

Class B transactions prevailed in the structure of lease transactions - 76% of the total volume of implemented premises. Thus, the office market of St. Petersburg faced a high demand for quality Class A premises, which were in short supply, and partial replacement of the needs at the expense of lower-class premises.

Most of the tenants who approached Knight Frank St. Petersburg in 2017, wanted to change their location and searched the fitted out premises in Central, Petrogradsky and Moskovsky districts. Interestingly, 66% of Class A and B office space was leased in these business districts in total according to the results of 2017. The main budget of requests varied between 1,100-1,200 rub./sq m/month. The size of the rental rate, location, transport accessibility and parking availability were still the determining factors when choosing an office.

Chart 4. Dynamics of delivery volume, take-up and vacancy share

Source: Knight Frank St Petersburg, 2018

Commercial terms

The upward trend of rental rates was observed both in 2016 and 2017. The average rental rate for vacant space in Class A business centres was 1,835 RUB/sq m/month, in Class B business centres - 1,171 RUB/sq m/month, including VAT and OPEX. Compared to the end of 2016, the asset-by-asset increase of rents was 11% and 6% for both classes in rubles, respectively, such a growth in Class A properties was caused by the rental increase in 6 business centres of Vasileostrovsky district. Such reaction of landlords can be connected with the opening of the central part of ZSD (Western High-Speed Diameter), which improved the transport situation of the district.

The average Class A rental rate was registered at the level 317 $/sq m/month and 203 $/sq m/month including OPEX, net of VAT, increasing by 13,1% in Class A and 9% in Class B due to declining of US dollar against the ruble.

The declared average cost of an open parking lot was 5,301 RUB/parking lot/month and 8,018 RUB/parking lot/month for indoor parking by the end of 2017. The average rental rate for a parking lot rose by 8% in Class A business centres and went down by 6% in Class B properties, if compared with the results of previous year.

Chart 5. Rental rates dynamics from 2007

Source: Knight Frank St Petersburg, 2018

Forecast

According to our estimates, about 263,000 sq m of office space for lease shall be added to the office real estate market in 2018. If so, the results of 2018 will be 84% higher than the results of 2017. Nevertheless, the office space in the multifunctional cultural and business complex Lakhta Center, designed for Gazprom's own needs, will hold a significant share of the delivery. Therefore, it is worth noting that, without taking into account this office space, only 50% of the declared volume of new supply will be intended for the lease market. Moreover, the completion of all projects on schedule is unlikely due to a long period of implementation or zero construction stages, so the actual amount of new supply will hardly provide tenants with enough office space in 2018.

The downward trend of the vacancy rate by 1-1.5 p. p. will be strengthened on the market in connection with the rotation of tenants as well as with slowing pace of construction and commissioning of new quality business centres in 2018. The shortage of quality supply and removal of large office units from the market in the short term will serve as prerequisites for further rental increase by 7-10%, since the vacation of office space, leased by Gazprom's structures and contractors, should be expected no earlier than 2019.

Chart 6. New supply distribution depending on the purpose, %

Source: Knight Frank St. Petersburg Research, 2018

Table 5. Key properties to be commissioned in 2018

Leasable office area, Title Business district Developer Class thousand sq m Lakhta Center (tower) North-Western Gazpromneft-Invest A 75.3 Lakhta Center North-Western Gazpromneft-Invest A 27.9 (multifunctional building) Ligovsky 266 (3rd phase) Moskovsky Prospect Stroitelnye mashiny B 16.5 Business Centre at Vasileostrovsky-2 Dal’piterstroy B 15 Nalichnaya Promyshlennaya Atlas City Moskovsky Prospect Innovacionnaya B 13 Companiya Multifunctional Complex Embankments with views SetlGroup B 11.2 Riverside (building D) Dom Pushniny Moskovsky Prospect Pushnoy Dom B 10 Aura Outer area Bestȁ A 8.2 GRANI Petrogradsky Stroitelny trest B 7 Senator at Malyi Avenue Imperia Financial and Petrogradsky A 6.7 P. S. Holding Company Kompleksnye Stroitelnye Pythagor Vasileostrovsky-2 B 3.6 Technologii Obvodny 28 Obvodny Torgtrans-servis B 3.6 Renaissance Renaissance Fontanka Admiralteisky A 3.4 Development Source: Knight Frank St. Petersburg Research, 2018

Map 1. Map of the office real estate development zones

Source: Knight Frank St Petersburg, 2018

Rival projects in the proximate site neighborhood. Analysis of competitive landscape changing perspectives. Kazanskaya Street

Table 6. The list of existing competitors in the zone of influence of the property, Q4 2017

ȶ on The total area, Leasable area, Property Name Address Class map sq. m sq. m

ȶ on The total area, Leasable area, Property Name Address Class map sq. m sq. m 1 Au Pont Rouge 75-79, Moyki river Emb A 15,000 9280 2 Au Pont Rouge (2 phase) 73, Moyki river Emb A 5598 4199 3 Au Pont Rouge (3 phase) 75-79, Moyki river Emb A 2303 1957 4 Bolloev Center 4, Grivcova lane A 9040 8150 5 White night 23, Malaja Morskaja St B 7333 5500 6 Atrium 1/25, Kazanskaja St B 5300 4240 7 NOVO-ISAAKIEVSKIJ 24, Jakubovicha B 3900 3198 8 Admiralty House 3, Konnogvardejskij St B 2500 2000 9 Lenizdat 59, Fontanki river Emb C 12,800 9600 10 Na Sennoy 14/35, Spasskij lane C 11,000 8250 11 Trezubec / Mir ǧ, Efimova St C 9000 8000 12 Kazanskij 7, Kazanskaja St C 8335 6251 13 Mariinskij 58, Moyki river Emb C 6133 4600 14 Alva 8, Apraksin lane C 2919 2296

Source: Knight Frank St Petersburg, 2017

Office centers in the zone of the competitive environment are presented in the map below.

Map 2. The existing competitors in the zone of influence

Source: Knight Frank St Petersburg, 2017

Rival projects in the proximate site neighborhood. Analysis of competitive landscape changing perspectives. Paradny Kvartal

Table 7. The list of existing competitors in the zone of influence of the property, Q4 2017

ȶ on The total area, Leasable area, Property Name Address Class map sq. m sq. m Nevskaja Ratusha 1 11, Degtjarnyj lane A 27 182 23 423 (building 2) Nevskaja Ratusha 2 11, Degtjarnyj lane A 18 300 15 234 (building 3) 3 Sinop 22, Sinopskaja Emb A 21 192 12 020 4 Preobrazhenskij dvor 26, Litejnyj Ave A 15 000 11 500 5 Grecheskij 13-15, Ligovskij Ave A 4 500 3 400 6 Trubeckoj 9, Paradnaja St A 5 075 3 318 7 Orlov 7, Paradnaja St A 4 877 3 184 8 Ligovskij, 6 6, Ligovskij Ave A 3 565 1 824 9 Zolotaja Shpalernaja 54, Shpalernaja St B 14 000 7 500 10 Goldex 36, Shpalernaja St B 11 009 7 400 11 Nekrasova, 14 14, Nekrasova St B 7 000 5 600 12 Vosstanija, 18 18, Vosstanija St B 6 350 5 400 13 Kovenskij, 5 5, Kovenskij lane B 6 490 4 868 14 Bashkirov 52, Sinopskaja Emb B 4 600 3 800 15 B&D 50, Sinopskaja Emb B 3 500 2 800 16 NRK 3, Kaluzhskij lane B 3 800 2 700 17 Kacus 8, Tverskaja St B 3 576 2 682 18 Chajkovskogo, 44 44, Chajkovskogo St B 2 373 1 898 19 Novgorodskaja,13 13, Novgorodskaja Ave B 2 551 1 855 20 Sinopskaja 68-70 68-70, Sinopskaja Emb B 1 584 1 584 21 Moiseenko 24 24, Moiseenko Ave B 1 512 1 210

Source: Knight Frank St Petersburg, 2017

Office centers in the zone of the competitive environment are presented in the map below.

Map 3. The existing competitors in the zone of influence

Source: Knight Frank St Petersburg, 2017

Office market overview of Moscow

Executive summary x The delivery volume of new office centres in 2017 remained at the lowest level as just 96,000 sq m were put into operation within 9 months of 2017 - 2.5 times less than last year's figures. x The average asking Class A rents rolled back to figures of the 2016 end-of-yearto 24,173 rub./sq m/year- 0.4% less against the end of 2016. In Q3 2017 Class ǩ offices evidenced a slight 0.7% growth instead, running up to 13,474 rub./sq m/year. x The Class A vacancy share was 2.3 p. p. down from the beginning of the year reaching 18.4%. In Class ǩ offices the 9-month decrease was 2.2 p. p. going to 13.3% at the end of Q3

Table 8. Key indicators of office market as of 2017 Q3

* Compared to Q4 2016 ** Excluding operational expenses, utility bills and VAT (18%) *** OPEX rate does not consider change related to property tax rate increase Source: Knight Frank Research, 2018

Supply

The overall office quality stock in Moscow came up to almost 16 million sq m in Q3 2017, where 25%/almost4 million sq m corre- sponded to Class A offices and 75%/12 million sq m to Class B.

Almost 75 thousand sq m of new quality office space were commissioned in Q3 2017 after an all-time low new delivery of H1 2017, when only 21 thousand sq m were put into operation. The delivery volume of 9 months of the year reached 96 thousand sq m, which was still the least value for this period for the whole period of market surveillance.

About 270 thousand sq m of new office space are planned for delivery till the end of 2017, the bulk of which will be located in Neopolis (63,000 sq m), IQ-Quarter (75,000 sq m) and Federation Vostok (82,000 sq m). Lots of developers, observing the strengthening of the office real estate market in Moscow, restart their former projects and proceed to the construction of the new ones. This market stabilization is characterized by the low volatility of rental rates and vacancy rate reduction. Circa 530 thousand sq m are planned for commissioning in 2018, where 55% /295 thousand sq m will be related to Class A offices. 239 thousand sq m of Class ǩ offices are

expected to be delivered in 2018. The planned delivery of office stock of 2018 will exceed the indicators of 2017 by 44%.

The Class A vacancy rate came to 18.4%, equivalent to 729 thousand sq m in absolute terms. 1.6 million sq m were unoccupied in Class ǩ offices, which was 13.3% of the total supply.

Chart 7. Class A and B new delivery volume dynamics

Source: Knight Frank Research, 2018

Map 4. Projects scheduled for delivery in 2017

* Office properties that received the delivery act in Q1–Q3 2017 The building class is indicated according to the Moscow Research Forum Office Classification of 2013 Source: Knight Frank Research, 2017

As determined by history, the second half of the year is top-performing in terms of the bulk of the lease transactions completed which is affected by the negotiation process and preparation for

transactions taking place in the first half of the year. Therefore, the vacancy rate kept falling both in Class A and Class ǩ offices (by 2.3 p. p. and 2.2. p. p. from the start of the year, respectively) despite the impressive delivery volume of new properties in Q3 if compared to H1 2017.

The greatest changes of the Class A vacancy share took place in the following business districts of Moscow for 9 months of the year

x The south-west of the Moscow Ring Road witnessed a 12 p. p./20(000 sq m decrease due to a large transaction of Tele 2 company to lease office space in Comcity Business Centre. x Circa 25,000 sq m were put out of the market in the north of the Garden Ring, which was equal to 7% of all vacant space, owing to a number of transactions in such business centres as Diamond Hall, Summit and Hermitage business centres. x MIBC Moscow-City reported a 4 p. p./28,000 sq m decline of the vacancy rate.

The ultimate changes of the Class ǩ vacancy share were highlighted in all districts of Moscow in Q3 2017:

x The vacancy dropped down by 7 p. p./40,000 sq m in the north of Moscow, in the area between the Third Transport Ring and the Fourth Transport Ring. x 34 thousand sq m/4 p. p. were withdrawn from the market of Tulsky business district located in the south of the Third Transport Ring. x The vacancy spiraled up by 9 p. p./ 26,000 sq m in Kievsky business district in the west of the Third Transport Ring.

The large new delivery volume of Class A office centres, scheduled for Q4 2017, will boost the vacancy share. However, the current take-up rates partially level down the pace of new delivery, and as a result, the Class A vacancy rate will rise to 19.1% in the end of 2017 but will be lower than the 2016 result. Class ǩ offices will face a slight vacancy increase - up to 13.5% by the end of the year because of the launch of new facilities to the market at the end of the year.

Demand

In Q3 2017, the market won back low figures of H1 2017, when the transaction volume was twice as small against the same indicators in 2016. The transaction volume with quality office real estate in Moscow amounted to 534 thousand sq m over the past 9 months of 2017, which was only 14% lower than the same indicator for 2016. Here we do not include two largest transactions in 2016, when VTB purchased Eurasia office centre and the structures of the Moscow Government were located in ǵǱǵ complex, both properties were situated in MIBC

Moscow-City. The volume of transactions in 2017 exceeded the indicators of 2016 by 11%. The high performance of the market in Q3 can be explained by the stabilization of the market and the rental rates as well, which affect players' sentiment who are trying to take advantage of this moment and conclude leases on the most favourable terms until rental rates begin to rise.

Chart 8. Dynamics of new delivery, take-up and vacancy rates of Class A and B offices

Source: Knight Frank Research, 2018

The leaders in the volume of transactions for Q1-Q3 2017 were the companies representing the Telecommunications/Media/Technologies sector, just as in the previous year. However, their share in the overall volume of transactions went down from 30% in 2016 to 21% in 2017. The companies of the manufacturing sector of the economy were active to complete transactions with the office real estate in Moscow. Their share in the total volume of transactions was 17%.

76% of all Q1-Q3 transactions with quality offices took place outside the Garden Ring. The complex transport situation in the city centre and high rental rates support the decentralization of the office market The share of lease transactions within the Garden Ring decreased by 9 p. p. for 9 months of 2017 if compared to the same period in 2016. In these circumstances the share of transactions with quality office real estate located close to the Third Transport Ring grew by 13 p. p. in 2017 against last year's figure.

The structure of demand for office units depending on their size remained practically unchanged within 9 months of 2017 against the same period in 2016. Q1-Q3 2017 demonstrated the increase of the share of transactions with office units of 1,000-12,000 sq m and 2,000-5,000 sq m by 3 p. p. This growth was due to a decrease in the share of transactions with office units of 500-1,000 sq m.

The market-share gain of transactions with office units of more than 1,000 sq m in 2017 is also supported by the average transaction size - 1,816 sq m of the average value for 9 months of 2017 - 10% higher than the same period last year if excluding the 2 major transactions of VTB and the Moscow City Government in MIBC Moscow-City.

Chart 9. Tenant mix

Source: Knight Frank Research, 2018

Chart 10. Distribution of transactions by type and location

Source: Knight Frank Research, 2018

Table 9. Key lease and purchase transactions closed in 2016

Source: Knight Frank Research, 2018

Commercial terms

Q3 witnessed the adjustment of rates when the average Class A rents in Moscow returned to the level of the end of 2016 after their decrease mainly in Q1 which continued in Q2. Q3 rental rates amounted to 24,173 rub./sq m/year, which was only 0.4% less than the similar figure at the end of 2016.

The growth of Class A rents in Q3 2017 was caused by several factors:

x Several inexpensive office units were excluded from the market, in particular, in MIBC Moscow-City and Northern Tower. x The Q3 delivery of new quality office centres located in the most demanded districts of Moscow, for example, Oasis Business Centre in Paveletsky business district, which is offered for lease at a rate of 29,000 rub./sq m/year.

The Class ǩ average rental rate has settled down: it has ranged within 1% for 4 consecutive reporting periods starting from Q3 2016. The Q3 2017 figure was 13,474 rub./sq m/year - 0.7% higher than the last year's index.

No drastic changes of rental rates are estimated by the end of 2017 and, in general, they will remain on par with the end of 2016: 24,000 rub./sq m/year for Class A offices and 13,500 rubysq m/year for Class B.

The most landmark changes of Class A rents occurred in the following business districts of Moscow for 9 months as compared to the end of 2016:

x Several main premium business centres (Berlin House, Geneva House, Moskva) put down the asking rental rates in Central Business District. Therefore, the average rents of the district changed by 19%.

x The asking rents sank by 12% as a result of the withdrawal of expensive offices from the market in Comcity Business Centre in Novaya Moscow in the south-west of the Moscow Ring Road. x The rental rate in Khamovniki district showed a 6% increase as some inexpensive office units were removed from the market in Japanese House Business Centre.

The most significant changes of Class ǩ rents occurred in the following districts during the same reporting period:

x The average rental rate grew by 15% in Presnensky business district as several low-cost office units were excluded from the market in Apelsin Business Centre, the rents in Park Tower Business Centre were increased, as well as the launch of new office units in Rassvet Business Centre and RochDel Centre. x The average asking rental rate was 20% down in Zamoskvorech'e as expensive and liquid premises were removed from the market in Domus, Legion I, Riverside Towers and a number of others.

Chart 11. Average asking rental rates dynamics for Class A and B offices denominated in RUB

Source: Knight Frank Research, 2018

Chart 12. Average asking rental rates quarterly dynamics for Class A and B offices denominated in USD

Source: Knight Frank Research, 2018

Forecast

According to our prediction, all the properties planned for delivery in 2017 will be commissioned by the end of the year. According to the forecasts of the Ministry of Economic Development, GDP growth is expected at 1.8- 2% in 2018. A small economic revival will have a positive impact on the market of quality office real estate in Moscow. An increase in the new construction volume is forecasted in 2018, which may amount to more than 500 thousand sq m of quality business centres.

The fourth quarter has always been the most dynamic period in terms of the conclusion of major part of transactions, so we expect the demand growth by the end of the year. The net take-up rate of quality office real estate in Moscow will get to 550 thousand sq m. Next year it will remain at 550-600 thousand sq m, and perhaps the take-up will be even higher due to a number of major transactions, which are already under discussion in 2017. For example, the relocation of several ministries of the Russian Government from their old buildings in the city centre and their consolidation in one or several towers in MIBC Moscow-City. The estimated transaction volume will be more than 70 thousand sq m.

The vacancy share in quality office centres of Moscow will grow slightly by the delivery of new office centres until the end of 2017 up to 19.1% in Class A offices and up to 13.5% in offices of Class B.

The state authorities do not forecast the strengthening of the Russian currency in the next 2-3 years. The average annual dollar exchange rate may rise to 64 rubles in 2018 (in 2017 - 59.4 rubles) according to the forecasts of the Ministry of Economic Development of Russia. By 2020, the Russian currency is expected to depreciate to 68 rubles per dollar. Thus, the probability of reapplying the nomination of rental rates in dollars in the next 3 years is next to none. Those office buildings, where landlords still nominate the rental rate in dollars, will stick to their leasing policy. However, there unlikely be new properties with dollar rental rates, as the strengthening of the dollar against the ruble does not contribute to the nomination of rental rates in dollars.

We expect that Class A and ǩ average rental rates will be kept at the 2016 level until the end of 2017 - 24,000 rub./sq m/year and 13,500 rub./sq m/year, correspondingly.In our 2018 projections, there will be a decrease in volatility and stabilization of Class A rental rates with a small growth in the range of 2-3%. Class ǩ offices will face the increase of the average asking rental rates at the level of 4-5% in 2018.

Table 10. Moscow submarket data. Key indicators

Source: Knight Frank Research, 2018

Rival projects in the site immediate neighborhood

Table 11. The list of existing competitors in the zone of influence of the property located at 16, Tverskoy bulvar, Moscow

Name Comparable 1 Comparable 2 Comparable 3 Location 36/2Ǹ6 Arbat St, Moscow Gogolevskiy bul., 5S1, Moscow Leont'evskiy per., 2AS2, Moscow Source of information https://www.cian.ru/sale/commercial/14178291/ https://www.cian.ru/sale/commercial/170363635/ https://www.cian.ru/sale/commercial/170693102/ Asking price, rubles, 777,770,000ȗ. 763,460,000ȗ. 380,000,000ȗ. incl. VAT Asking price, rubles per 289,134ȗ. 427,876ȗ. 277,372ȗ. sqm, incl. VAT

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 218

Table 12. The list of existing competitors in the zone of influence of the property located at 22, Avtozavodskaya street, Moscow

Name Comparable 1 Comparable 2 Comparable 3 Comparable 4 Comparable 5 Comparable 6 Comparable 7 Comparable 8 Comparable 9 Moscow, ul. Moscow, Moscow, Moscow, ul. Moscow, ul. Moscow, Moscow, Moscow, Moscow, ul. Letnikovskaya, Kashirskoe sh., Komsomol'skiy Nagornaya, 20K1 Derbenevskaya, 11 Volgogradskiy Paveletskaya nab., Paveletskaya nab., Letnikovskaya, Location 10S2 3K1S9 prosp., 42S3 prosp., d. 32, korp. d. 8 S6 d. 8 10S2 7 https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r https://www.cian.r Source of u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial u/sale/commercial information /159759394/ /169073947/ /169088604/ /169087629/ /169087626/ /159759394/ /169073947/ /169088604/ /169087629/ Asking price, 288,135,593ȗ. 405,720,000ȗ. 549,986,816ȗ. 1,133,262,712ȗ. 1,703,601,695ȗ. 288,135,593ȗ. 405,720,000ȗ. 549,986,816ȗ. 1,133,262,712ȗ. rubles, incl. VAT Asking price, 84,746ȗ. 120,000ȗ. 109,997ȗ. 105,932ȗ. 105,932ȗ. 84,746ȗ. 120,000ȗ. 109,997ȗ. 105,932ȗ. rubles per sqm, incl. VAT

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 219

Table 13. The list of existing competitors in the zone of influence of the property located at 16, Davydkovskaya street, Moscow

Name Comparable 1 Comparable 2 Comparable 3 Comparable 4 Moscow, Ramenki district, Mosfilmovskaya Moscow, rn Dorogomilovo, st. Neverovsky, 10 Moscow, Ramenki district, Minskaya street, Moscow, Ramenki district, Minskaya st., 1GK1 Location st., 53 1GC2 Source of https://www.cian.ru/sale/commercial/150884 https://www.cian.ru/sale/commercial/1695148 https://www.cian.ru/sale/commercial/6931906 https://www.cian.ru/sale/commercial/1647050 information 718/ 63/ / 47/ Asking price, 59,034,200ȗ. 115,556,000ȗ. 106,000,000ȗ. 48,300,000ȗ. rubles, incl. VAT Asking price, rubles per sqm, 194,000ȗ. 280,000ȗ. 225,532ȗ. 230,000ȗ. incl. VAT

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 220

Residential market overview of St. Petersburg and Leningradskaya Oblast’

In location description the following concepts and terms are used:

1. The city: the following administrative districts of St Petersburg included: Admiralteisky, Vasileostrovsky, Vyborgsky, Kalininsky, Kirovsky, Krasnogvardeisky, Krasnoselsky, Moskovsky, Nevsky, Petrogradsky, Primorsky, Frunzensky, Central (Tsentralny). 2. ADS: suburban administrative districts subordinate to St. Petersburg: Kolpinsky, Kronshtadtsky, Kurortny (Resort), Petrodvortsovy, Pushkinsky. 3. Suburbs: settlements of Leningradskaya Oblast’ (LO) adjacent to St. Petersburg city borderline:

Vsevolozhsky: Bugry, Vartemyagi, Vsevolozhsk, Zanevka, Kal’tino, Koltushy, Kudrovo, Luppolovo, Mistolovo, Murino, Novoye Devyatkino, Romanovka, Sverdlova, Sertolovo, Toksovo, Scheglovo, Yukki, Yanino-1, Yanino-2

Gatchinsky: Taitsy

Kirovsky: Otradnoye

Lomonosovsky: Gorbunki, Lagolovo, Nizino, Novogorelovo, Novosel’ye, Russko-Vysotskoye, Uzigonty

Tosnensky: Nikol’skoye, Fedorovskoye, Tel’mana

Supply9

Real estate market is subject to certain cyclicity, related primarily to the economic situation. At the same time, the market is affected by administrative factors. E.g., a rather sharp decline in housing under construction was observed in 2006-2007, due to the changes that took place earlier in the legislative framework, especially in the order of allocating the plots for construction and costs of government regulation of housing construction.

Many companies have frozen their projects when the 2008 crisis had arrived. This was due to the reduction in effective demand, but also largely due to the outflow of credit from development. The reduction in demand in high-class segments has forced developers to shift to less affluent customers through projects re-conception and lowering their class. This resulted in deteriorating of the projects’ conceptual quality and in exposition terms increase, despite of growing supply (that largely became possible thanks to lower rates of absorption and total inertia of the real estate market).

The market has demonstrated positive dynamics in 2011: work in all residential segments has activated, number of deals with land plots for housing construction has grown compared to 2010. Almost 500 Ha of land for residential projects were sold through tenders only in 2 years; in addition a number of buildings intended for demolition or reconstruction were sold, and transactions with plots of land held freehold were exercised.

9 the amount of apartments available to buyers at the moment

Positive dynamics in all segments was recorded in the residential property market of Saint Petersburg and Leningrad Oblast’ from 2012 to 2014. In 2014, the market volume of St. Petersburg and suburban areas reached a peak of 12.4 million sqm (the total area of residential complexes for sale), after which it began to decrease smoothly until the end of 2016. The main market volume decline occurred in the urban area, while the volume of construction in suburban locations on the contrary increased, which was due to the high level of demand amid low prices for apartments.

In 2017 the volume of new construction in the suburban area began to decline. As a result, the share of this location in the total market volume for the year decreased by 5 percentage points, which is 4.5 million sqm (taking into account the administrative and subordinate districts of St. Petersburg10). But at the same time the volume of construction in urban areas began to increase, mainly due to the redevelopment of former industrial territories and also the development of outlying areas (for example, the Kamenka neighborhood in the Primorsky region). In general, the volume of housing under construction in St. Petersburg and the suburbs in 2017 amounted to 11.7 million sqm.

Chart 13. Total area of housing under construction dynamics in Saint Petersburg and its suburbs, th. sqm

Source: Knight Frank St Petersburg, 2018

Market structure analysis by class reveals the following pattern:

The market of elite housing is still limited, its share in the structure of housing in St. Petersburg is around 6-8%, and 3-4% in the structure of housing in St. Petersburg and the nearest suburbs. In 2017 the share of A-class in the supply structure has not changed.

10 Administratively Subordinated Districts (ASD) - administratively subordinated districts of St. Petersburg: Kolpinsky, Kronshtadtsky, Kurortny, Petrodvortsovy, Pushkinsky, as well as remote locations of urban districts located on the border with the region or districts of ASD (for example, Budennogo Avenue in Krasnoselsky district of St. Petersburg).

The share of B-class decreased by 3 percentage points to 13% in 2017, which is explained by the slow pace of entering the market with new projects and natural supply reduction on the background of stable demand.

In 2017 the mass housing market has changed significantly. The supply in the suburban area began to decline in favor of the growth of construction in urban areas. As a result, the share of C-class housing in the suburbs decreased by 5 percentage points to 32%, while the share of housing of C-class in urban areas increased by 7 percentage points to 51%.

Chart 14. Supply structure by class, %

Source: Knight Frank St Petersburg, 2018

The shares of unsold flats in the residential real estate market of St. Petersburg currently are: 41% in A- class, 36% in B-class and 39% in C-class. In the suburban areas this share in C-class is 44%.

The volume of avaliable supply on the residential real estate market of St. Petersburg amounted to 2.8 million sqm and 1.9 million sqm in the suburbs.

Chart 15. The available supply dynamics by class, th. sqm

Source: Knight Frank St Petersburg, 2018

The slowdown in the pace of entering the market with new projects from 2014 to 2016 due to the huge accumulated stock of areas has stopped in 2017. Over the past year sales in complexes with a total residential area of 4.3 million sqm were opened, which is 19% higher than in 2016. The reason for this was the change in housing legislation, which will finally come into force in July 2018. Developers are back on the market for the purchase of land plots prepared for construction, accelerating the procedure for obtaining construction permits for projects in the active phase of construction.

Chart 16. New objects entering the market by class, th. sqm

Source: Knight Frank St Petersburg, 2018

Due to the increased volume of new projects on the market, the supply structure for developers was adjusted. The top ten market players now account for 45% of the sales, which is slightly higher in 2016. However, in the context of the forthcoming legislative changes, small construction companies are likely to leave the market, as a result of which the monopolization of the market may intensify.

Chart 17. Supply volume of housing under construction by developer, %

Source: Knight Frank St Petersburg, 2018

Territorial leaders of new construction in the residential real estate market of high-price class are Petrogradsky and Central districts – their share in the total construction volume in 2017 increased from 44% to 52% due to the sale of new facilities.

Chart 18. A and B class residential construction volume by district, sqm

Source: Knight Frank St Petersburg, 2018

In the mass segment the absolute leader is Vsevolozhsky district of the region by the number of offers, where 3.2 million sqm of housing is being built. The number of housing units in the district has decreased by 13% compared to 2016. Among the urban areas Primorsky and Nevsky districts are still leading.

Chart 19. Supplied volume of housing under construction in Ǹ class by district, sqm

Source: Knight Frank St Petersburg, 2018

In A-class, the basic offer is represented by apartments with 2 and 3 bedrooms – they make up about 70% of flatography.

The main share in the flatography of B-class facilities is taken by apartments with 1 and 2 bedrooms, which account for 68% of the total number of apartments. The share of 3-room apartments in this segment is also high and is about 24%. In comparison with the mass segment, B-class apartments are more comfortable due to spacious bedrooms and ancillary facilities (cloakrooms, storerooms, etc.).

In urban C-class projects 44% of the supply falls on small one-room apartments with an average area of about 38 sqm. The share of apartments with 2 bedrooms and studios in the facilities of this class is

approximately comparable – 25% and 23%, respectively. And the apartments with 3 bedrooms make up only 8% of flatography.

Objects of C-class in suburban locations are significantly different from urban sites: a large proportion of studios – almost 40%, the proportion of apartments with 2 bedrooms is less than 10 percentage points, the number of apartments with 3 bedrooms in projects is minimal – about 4 %.

Chart 20. Structure of typical flats layouts by class, %

Source: Knight Frank St Petersburg, 2018

Chart 21. Average area of apartments in typical projects by class, sq m

Source: Knight Frank St Petersburg, 2018

Demand

Residential market cyclicity, comprising the phases of rise, stabilization and slowdown is reflected in the different sales structure by class of property. Thus, mass market demonstrates strong fluctuations in amount of sales depending on the stage of the cycle. Elite segment is relatively constant, which depends more on the availability of specific attractive offers in the market. Business class occupies an intermediate position between the two above-mentioned segments.

A sharp rise in demand has occurred in all residential property segments in the second half of 2013 with the beginning of foreign currency appreciation. The highest buying activity over the past few years was observed in the residential property market in 2014, against the background of high volatility of national currency. Real estate has become regarded virtually the only reliable way of investing by the buyers.

In subsequent years, there were smaller sales volumes compared to 2014, but in general, the level of demand can be characterized as high, because it exceeds the stable 2012-2013.

In 2017 4.2 million sqm of housing were sold in St. Petersburg and the suburbs (including APR), which is 6% less than in 2016. The main share of demand in the amount of 52% is in the suburban areas, the proportion of sold C-class housing in the urban area is 38%. It is important to note that compared to 2016, the share of sales of mass demand facilities in the suburban area decreased in favor of its increase in urban areas.

Chart 22. Demand dynamics by class, million sq m

Source: Knight Frank St Petersburg, 2018

The sales show trends common in the market, such as:

i The sales remained at high level not depending on a project’s characteristics during the active demand periods.

i A company had to offer better quality at a competitive price to ensure good sales in 2009- 2010. Now a pace of implementing a project has decreased by 2-3 times compared to a pre- crisis one.

i In 2011-2013 sales volumes increased smoothly, exceeding the level of 2007.

i 2014 was the period of rush towards the market of real estate under construction in St. Petersburg and suburbs caused by high currency volatility. The greatest demand was on budget new buildings in suburban areas.

i In 2015-2017 demand naturally turned out to be lower than in 2014, but in general they exceeded sales volumes of the previous stable period 2012-2013.

Typical sales structures by apartment type and by average area for ǧ, ǩ and Ǹ class housing are as follows.

Commercial Terms

High demand for housing under construction in the pre-crisis years served as a prerequisite for raising prices (the mean pace was 25-40% p.a.). Prices raised most of all in 2006 (almost in 2 times). The number of people who could buy property at the new prices has fallen sharply. Developers have been forced to lower asking prices in the late 2008 – early 2009 due to an unfavorable situation with sales, especially at early construction phases. Many companies had to grant discounts to stimulate demand.

Effective demand is limited and, though it provides high sales volumes in the periods of growing market, it is not capable to retain them for a long time. Anyway, at the moment one can observe a trend to active price growth in all the residential property segments, which continues since 2010. A variety of commercial terms, activation of banking sector in mortgage lending are also affecting positively the price dynamics.

In 2017 the average price of supply increased only in urban B- and C-classes facilities – by 3% and 4%. In A-class, despite the growth in the average price due to a change in supply structure and the appearance of expensive premium properties on the market, there was practically no price dynamics for the real estate.

In suburban C-class facilities stagnation of prices for already implemented objects occurred. The sale of new objects at lower prices affected the average price for the class, which in comparison with 2016 decreased by 1%.

In 2017 the average prices in houses under construction amounted to: x in class ǧ – 351.6 thousand rubles / sqm, x in class B – 159.5 thousand rubles / sqm, x in class C – 101 thousand rubles / sqm, x in class C in the Suburbs – 64 thousand rubles / sqm.

Chart 23. Average price dynamics by class, rub./sqm

Source: Knight Frank St Petersburg, 2018

Main conclusions and trends in the residential market of Saint Petersburg and its suburbs: x Projects of mass demand are highly competitive. Along with this, there is a shortage of quality residential complexes with original architecture and well-designed layouts. x Due to the forthcoming changes in the legislation, there was fixed the acceleration of the market entry of new projects/phases after a short recession. x The over-saturation of the market of suburban locations led to the reduction of new projects, and as a consequence of the total supply volume. Developers began to develop urban plots for real estate construction, mainly representing the redevelopment of former industrial areas. x Due to the scale of new residential projects, there is already a deficit of provision of social infrastructure facilities, which will only grow in the future. Therefore, small projects within the habitable areas of St. Petersburg will be in high demand and show good sales rates. x Due to the expansion of the geography of residential construction far beyond St. Petersburg, the emergence of an interesting offer within the city, in an area with an existing social and commercial infrastructure, within walking distance from the metro station will be in high demand among potential customers. However, for a more successful implementation of promising projects, they must have a certain set of quality parameters – a well-thought-out flatography, comfortable well- designed layouts, modern house engineering and ergonomic infrastructure. x In the future, the supply volume in the suburbs will increase at a slow pace due to town-planning constraints and increased social pressure on developers. The offer in the city will be replenished with residential complexes under construction in the redevelopment areas. In the elite segment the location of the Petrovsky Island will be actively developed. x Due to oversaturation of market supply there is a high price elasticity of demand. At the same time, the forthcoming legislative restrictions, which will entail higher financial costs of developers, can lead to a further rise in real estate prices. However, the task of maintaining the proper level of liquidity will encourage developers not to inflate prices and try to provide a variety of discounts and installments.

x In conditions of intense competition in the mass segment the consumer will mainly focus on the price of the proposal, as well as on the significant features of the project itself. For example, infrastructure, open parking space or underground parking, terms of construction, etc. x High demand in the suburbs of St. Petersburg is due to more reasonable prices. So the average price in suburban residential complexes is on average 35% cheaper than a similar offer in the city. x In the business segment one-room and two-room apartments of small areas with comfortable layouts are in great demand. The share of transactions with three-room apartments is also significant, which is explained by the main motive for purchasing housing now – improving housing conditions. x In the mass segment in suburban area more than 80% of transactions were made with small one- room apartments and studios. In new C-class buildings in the urban area the demand was adjusted towards more comfortable than studios types of apartments, 1- and 2-room apartments.

Rival projects in the immediate neighborhood (residential premises or flats). Analysis of competitive environment changing perspectives

A number of analyzed objects have a single competitive zone, therefore for the purposes of this work they were grouped according to the following competitive locations:

Location ȶ Object LSR Location ȶ Object LSR

Smolny Park 14 Tsivilizatsiya

1 39 Radishcheva Novaya Okhta

Russkiy Dom 15 Ruch'i

Verona Tsvetnoi Gorod

Neva Art, Neva Residence 16 Rzhevka

2 Neva Haus

Dom na Dvoryanskoy

Osobnyak Martynova emb

3 Europa City

4 Tri Vetra

5 NEO

6 3 Moskovskoe (hotel)

7 Morskoy Fasad

8 Chernaya Rechka

9 Bogemiya

10 Yuzhnaya Aquatoriya

Sofiya 11 Zvjezdny duet

12 Kalina-park

Shuvalovskiy 13 Zapovednaya 51

Location 1. Smolny Park, 39 Radishcheva, Russkiy Dom

Elite objects (segments A and A+) located in the prestigious zones of Central and Admiralteysky districts were selected as competing residential complexes.

The map of competition

Source: Knight Frank St Petersburg

There are 8 elite residential complexes in the competitive zone with a total area of 56.5 thousand sqm (411 apartments and apartments), 2 of which are apartments ("Gollandiya" and "Monferran"). The competitive zone was updated with 2 new objects – "Prioritet" and "Konnogvardejskij Blvd. 13" compared with 2016.

All competing objects (except "Art View House" and "Prioritet") are commissioned.

Table 1. Characteristics of the competing projects

Non- resid Res. Residential Number Address Developer ential Class Deadline area, sq Șomplex of flats statu m s

Art View House Mojki 102 Ohta Group - ǧ+ Mar-19 3 748 24

Dvortsovaya Stremyannaya Soyuzgenstroj - ǧ completed 3 824 32 sloboda 15

RGS Galernaya 40/ + ǧ completed 7 376 102 Gollandiya Nedvizhimost' Admiraltejskogo

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 232

Non- resid Res. Residential Number Address Developer ential Class Deadline area, sq Șomplex of flats statu m s

Hovard Palace Zagorodny 19 Hovard - ǧ+ completed 16 617 73

Konnogvardejskij Konnogvardejski - ǧ completed 1 800 15 13 j 13 Individual

Konnogvardejski Monferran Inteko + ǧ+ completed 11 806 96 j 5

Osobnyak Kusheleva- Kutuzova 24 Dar - ǧ+ completed 6 310 29 Bezborodko

Voskresenskaya - ǧ+ Dec-18 5 059 40 Prioritet 32 Evrostroj

Source: Knight Frank St Petersburg

The closest competitors to the analyzed projects in terms of location are "Osobnyak Kusheleva-Bezborodko" and "Prioritet".

There are no Șomparable projects on the scale of elite complexes in the competitive zone.

Among the perspective projects 9 complexes with an average residential area of 192,000 sqm were declared in the competitive zone. About 80% of the projects are presented in the apartment format. The closest property to the commissioning is the club house "Opera Palace", which is now at the stage of marketing planning and preparation for the start of sales.

Four projects are on sale, so the terms of their implementation will be prolonged.

Table 2. Perspective projects

Address Project Developer Non- Res. area, sq m residential status

Aptekarskij per., d.6 Intef + 4 564

Konyushennaya pl., d.2 - PSN + 7 200

Glinki ul., d.4 Opera Palace Megahaus + 6 033

Marsovo pole, d.1A One Field of Mars Plaza Lotus Grupp + 24 000

Mohovaya ul., d.1/9 CHajkovskij Stanley + 5 100 o.Novaya Gollandiya (Mojki Novaya Gollandiya Novaya Gollandiya + 9 666

Address Project Developer Non- Res. area, sq m residential status r.nab., d.103) Development

Tavricheskij 12 - Confidential + 5 968

Shpalernaya 56 - Vodokanal +/- 105 000

Shpalernaya 51 - Uralsib - 24 632

Source: Knight Frank St Petersburg

The average price level in the objects of the competitive zone ranges from 222 to 752 thousand rubles/sqm.

Differentiation of prices in the objects of the competitive zone is largely due to the pricing policy of each developer, as well as a number of individual features of the objects.

The average price for competing objects is 445 thousand rubles/sqm. The dynamics of the average price for the objects of the competitive zone was about 7% in a year.

Table 3. Average price, average rate of sales of the competition projects

Residential Șomplex Finishing Av. price, Sold Parking, mln Commercial rub per units per rub premises: av. sq m quarter price, rub per sq m

Art View House pre-finishing 682 694 0 not on sale not on sale

Dvortsovaya sloboda without 263 419 1 not on sale not on sale finishing

Gollandiya pre-finishing 222 313 3 not on sale not on sale

Hovard Palace full 459 678 3 3,8 no in the project

Konnogvardejskij 13 full 332 835 1 not on sale not on sale

Monferran without 388 299 4 4,7 172 550 finishing

Osobnyak Kusheleva- different 752 057 1 3,0 396 353 Bezborodko

Prioritet pre-finishing 459 167 2 not on sale not on sale

Source: Knight Frank St Petersburg

The most expensive object in the competitive zone is the club house "Art View House". High prices are due to a large number of apartments overlooking the waterways of the city, as well as historic sites in nearby the object (for example, St. Isaac's Cathedral).

The minimum average price in the competitive zone is fixed in the residential complex "Gollandiya", where only apartments with no view are on sale.

Terms of completion of elite residential complexes in the analyzed location are different and are due to certain parameters of the projects. Objects that have any shortcomings (at planning solutions, no parking, etc.) are sold slowly. Average rate of sales of elite objects of the competitive zone remained stable and amounts to 2 apartments per quarter compared to 2016.

Location 2. Verona, Neva Art, Neva Residence, Neva Haus, Dom na Dvoryanskoy, Osobnyak Martynova emb

Competitors of the analyzed objects are elite residential complexes (segments A and A+) located in Petrogradsky district, in the locations of the Petrograd Side, Krestovsky and Kamenny islands.

Most of the competing properties are located in the western part of Petrogradsky district, along the Malaya Nevka River and also on the Krestovsky Island. In 2017 the share of Petrogradsky district in the total supply of elite housing has grown and now makes 70%.

The map of competition

Source: Knight Frank St Petersburg

In the south-eastern part of the Petrograd side, where the analyzed object "Dom na Dvoryanskoy" is located, elite projects are not on sale. All residential complexes under construction in this location are B-class residential real estate and are oriented mostly for mass demand.

There are 12 elite residential complexes in the competitive zone with a total area of 240,000 square meters or 1,900 apartments. Abouts 80% of residential areas are commissioned.

61% of area is concentrated in three complexes of quarterly construction – "Leont’ievskij", "Krestovskij de luxe" and "Privilegiya".

In 2017 main changes in the competitive zone relate to the stage of competion of the objects – several large projects were commissioned at once ("Leont’ievskij mys", "Krestovskij de luxe", "Privilegiya", "Imperatorskij Yaht- klub" and "Residensiya na Kamennom").

There is only 1 new object on sale – "One Trinity Place" on Admirala Lazareva embankment, in which apartments with finishing and furnishing are sold.

Table 4. Characteristics of the competing projects Projects of direct competitive influence Residential Address Developer Non- Class Deadline Res. area, Number Șomplex residen sq m of flats tial status

Del' Arte Sanatornaya 3 ProektStrojDom + ǧ+ completed 1 875 9 (Baltinvestbank)

Diadema Club Konstantinovskij Kredo - ǧ+ completed 14 484 73 House 23-25

Dom na Pesochnoj Pesochnaya 18 York - ǧ completed 5 891 59

Esper Club Ehsperova 16/23 Evrostroj - ǧ+ Mar-20 5 832 68

Imperatorskij YAht- Martynova 92 Morskoj YAht- + ǧ+ completed 14 050 61 klub Klub

Krestovskij 12 Krestovskij 12 EHtika + ǧ completed 3 333 25 development

Krestovskij de luxe Dinamo 44 GPBI - ǧ completed 42 756 359 Development Severo-Zapada

Leont'evskij mys Zhdanovskaya Leont'evskij mys - ǧ completed 57 226 392 45

One Trinity Place Adm.Lazareva 22 GHP Group - ǧ Dec-19 16 328 175

Privilegiya Vyazovaya 8 Evrostroj - ǧ completed 48 432 334

Rezidentsiya na 1 Berezovaya 7A EHkoinvest + ǧ+ completed 3 468 17 Kamennom

Royal Park Petrovskij 2 Kortros + ǧ Jun-18 26 196 298

Source: Knight Frank St Petersburg

Furthermore, there are 3 projects of indirect competitive influence, which are in the same location, but are lower class real estate – business light. In these projects there are 1285 apartments with a total area of 100.2 thousand sqm.

Projects of indirect competitive influence Residential Address Developer Non- Class Deadline Res. Number Șomplex residenti area, sq of flats al status m

Ostrov Remeslennaya 2 Stroitel'nyj trest - B+ completed 36 156 404

Residential Address Developer Non- Class Deadline Res. Number Șomplex residenti area, sq of flats al status m

Petrovskaya riv'era Petrovskij 20 Severnyj gorod - B Dec-18 15 388 249

Petrovskij kvartal na Petrovskij 26 Setl City - B+ Dec-19 48 682 632 vode

Source: Knight Frank St Petersburg

There are 17 perspective projects with a total residential area of 326.5 thousand sqm (55% of which are located on the Petrovsky Island) in the competitive zone. In 2017 there were some changes in the projects. Etalon Group purchased the plot of Lenstroytrest in the south-western part of the Petrovsky Island, and Setl City purchased the remaining 2 plots for housing near the "Almaz" factory next to "Petrovskij kvartal na vode", which is currently under construction.

Table 5. Perspective projects Non- Phase/ Res. area, sq Address Project Developer residential housing m status

Bezymyannyj o. - YAvara-Neva + 58 000

Karpovki 27 Meltzer Hall Bonava - 15 972

Karpovki 31A Severnaya Evrofinans + 33 543 Korona

Krestovki 3 - PiterStrojInvest + 1 260

Krestovskij o. - Confidential - 3 800

M. Nevki 16-18 - Admiral-Invest + 2 741

M.Nevki 33 - Baltijskaya kommertsiya - 1 346

M.Nevki 4 - Admiral-Invest + 1 300

Malyj 79-83 - Project in sale - 10 974

Michurinskaya 1 - Project in sale - 6 600

Petrovskaya kosa 1/2 - Lenstrojtrest - 21 210

Petrovskaya kosa 7/2 - Gruppa Etalon - 54 042

Petrovskaya kosa 9 - Ekostroj + 30 000

Petrovskij 26 - Setl City - 65 169

Petrovskij 9 - Leont'evskij mys - 10 000

Ryuhina 9 - Megasport + 5 500

Esperova 8 - YArd + 5 000

Source: Knight Frank St Petersburg

Average price range in the objects of the competitive zone varies from 250.6 thousand rubles/sqm to 1.69 million rubles/sqm. The highest prices were fixed in the club house "Rezidentsiya na Kamennom" and in the complex "Del’ Arte". In this, there were no sales in the second property.

The minimum average price for the competitive zone is preserved in "House on Pesochnaya", which is the second phase of construction (first is on 1-3, Grota St.). During the sales the structure of flatography in the object was changed and the commissioning was prolonged several times.

The average price in the competitive zone is 563.6 thousand rubles/sqm. At the same time the indicator for the relevant competing facilities is 32% lower and is 382.4 thousand rubles/sqm.

The average price on objects of indirect competition is 178.3 thousand rubles/sqm.

Table 6. Average price, average rate of sales of the competition projects Residential Șomplex Finishing Av. price, Sold units per Parking, mln Commercial rub per sq quarter rub premises: av. m price, rub per sq m

Del' Arte without finishing 870 507 0 7,0 no in the project

Diadema Club House without finishing 443 612 2 not on sale not on sale

Dom na Pesochnoj without finishing 250 616 1 3,0 not on sale

Esper Club without finishing 432 898 1 not on sale not on sale

Imperatorskij Yaht-klub without finishing 764 895 2 2,8 not on sale

Krestovskij 12 without finishing 333 375 1 1,5 not on sale

Krestovskij de luxe without finishing 281 807 16 3,0 290 000

Leont'evskij mys without finishing 373 848 12 3,0 205 953

One Trinity Place full 633 283 start of sales 2,3 not on sale

Privilegiya pre-finishing 360 991 15 3,9 sold

Rezidentsiya na different 1 686 500 1 2,3 no in the project Kamennom

Royal Park without finishing 331 610 10 3,0 180 000

Indirect competitors

Ostrov without finishing 177 746 23 1,9 160 000

Petrovskaya riv'era without finishing 182 930 23 not on sale no in the project

Petrovskij kvartal na vode without finishing 174 337 48 2,5 190 504

Source: Knight Frank St Petersburg

The most successful in sales projects in the competitive zone are residential complexes "Royal Park", "Krestovskij de luxe", "Leont’evskij mys" and "Privilegiya". The average rate of sales in these properties is within 10-16 apartments per quarter. In other objects sales are single – within 1-2 apartments per quarter.

The average rate of sales in objects of indirect competition is 31 apartments per quarter.

Location 3. Europa City

Competitors of the analyzed object are B-class residential complexes in Petrogradsky district. In the analysis aparthotels of investment orientation are not considered, because such facilities are rarely able to compete with new projects due to the specifics of planning decisions and another range of potential customers.

The map of competition

Source: Knight Frank St Petersburg

The closest competitors of the analyzed project are residential complexes "Skandi Klubb" (developer Bonava) and "Botanica" (developer Etalon Group), which is on sale since 2017.

The southwestern part of Petrogradsky District and on the Petrovsky Island is actively built up of new residential real estate.

The share of Petrogradsky district in the total supply of B-class properties is the biggest – 21%.

Seven new objects were on sale in 2017. Sales were over in one complex. In total, twenty B-class objects are sold in the competitive zone with a total residential area of 293.8 thousand sqm (3.8 thousand apartments).

Table 7. Characteristics of the competing projects Residential Phase/ Address Developer Non- Class Deadline Res. Numbe Șomplex housing resid area, sq r of ential m flats statu s

Atlant Mira 36A Konnolahtinskij - B Mar-18 4 075 57 55

Residential Phase/ Address Developer Non- Class Deadline Res. Numbe Șomplex housing resid area, sq r of ential m flats statu s

AVATAR Remeslennaya Stroitel'nyj + B Sep-18 8 942 105 21 trest

Biografiya Pionerskaya 33 RBI - B Sep-20 10 925 134

Botanica Aptekarskij 5 Etalon Group - B+ Dec-19 28 445 356

Dom na Zelejnoj B.Zelenina 34 Sadko-Siti - B+ Dec-18 7 360 92

Fusion Krapivnyj 4 Etalon Group - B Mar-18 9 555 110

GRANI B.Zelenina 24 Stroitel'nyj + B Mar-18 3 574 57 trest

Kingdom Lodejnopol'skay Akvilon-Invest - B Jun-20 10 260 156 a 7

Mendel'son Pionerskaya 53 Baltijskaya - B Mar-19 16 740 236 kommertsiya

Mirozdanie Mira 37 Setl City - B+ completed 13 769 191

Ofitserskij Phase 2 Ofitserskij 8 PSK Ofitserskij - B Mar-18 8 408 92

Ostrov Remeslennaya 2 Stroitel'nyj - B+ completed 36 156 404 trest

Petrogradets L.Tolstogo 8 Strojimpul's - B+ Mar-18 4 232 38

Petrovskaya riv'era Petrovskij 20 Severnyj gorod - B Dec-18 15 388 249

Petrovskij Kvartal Petrovskij 26 Setl City - B+ Dec-19 48 682 632 na vode

Prem'er Palas Housing 3-2 Pionerskaya 50 L1 - B+ Dec-19 4 870 42

Prem'er Palas Housing 4-2 Pionerskaya 49 L1 - B+ Dec-19 10 894 130

Prem'er Palas Housing 4-3 Pionerskaya 50 L1 - B+ Dec-19 11 497 148

Skandi Klubb Housing 21-28 Aptekarskij 16 Bonava - B completed 19 526 291

Skandi Klubb Housing 31-39 Aptekarskij 16 Bonava - B Sep-20 20 534 301

Source: Knight Frank St Petersburg

37% of the competitors are in a high stage of completion – commissioned or announced for commissioning by mid-2018, another 50% are scheduled for commissioning by the end of 2019.

There are 16 pespective projects with a total residential area of about 229 thousand sqm in the competitive zone. More than 50% of perspective projects refer to a new residential location on the Petrovsky Island.

Beginning of sales is expected in 2018 in following objects: 4a, Barochnaya St. (RBI), 24, B. Zelenina St. (Stroitel’nyy Trest) and 7/2, Petrovskaya Kosa (Etalon Group).

Table 8. Perspective projects Non- Phase/ Res. area, Address Project Developer residential housing sq m status

Ak. Pavlova 5 - Project in sale + 2 827

B.Raznochinnaya - Confidential - 3 394

B.Raznochinnaya 14 - Stankoservis + 12 152

B.Raznochinnaya 6 - Fiz. Litso - 2 225

Barochnaya 4a - RBI - 22 706

Dobrolyubova 18a - Yard + 15 000

Kr. Kursanta 10 Spasskaya SPb Rekonstruktsiya - 470 bashnya

Kr. Kursanta 25E - Kredo + 8 490

P.Popova 38 - Rigel' - 16 317

Petrovskaya kosa 7/2 - Gruppa Etalon - 54 042

Petrovskij 26 - Setl City - 65 169

Petrovskij per. 4 - Fiz. Litso - 2 268

Petrozavodskaya 9 Institut Rossijskoj istorii - - 18 623 RAN

Pionerskaya 13 - Gradara - 938

Ropshinskaya 10 Dom mod plyus - - 989 development

Chapaeva 28 - Forum HK - 3 247

Source: Knight Frank St Petersburg

Average prices in the objects of the competitive zone ranges from 144 to 198 thousand rubles/sqm. The highest prices are fixed in commissioned residential complex "Mirozdanie". The minimum prices in the location are observed in the complex "GRANI" of non-serviced apartments on 24, B. Zelenina St.

The average price in the competitive zone is 166 thousand rubles/sqm. The average price was slightly reduced by 2% compared to 2016.

Table 9. Average price, average rate of sales of the competition projects

Residential Phase/ Finishing Av. price, Sold Parking, mln Commercial Șomplex housing rub per sq units rub premises: av. m per price, rub per quarter sq m

Atlant without finishing 158 704 2 2,3 not on sale

AVATAR pre-finishing 162 997 3 not on sale 140 000

Biografiya without finishing 172 984 12 1,2 100 440

Botanica without finishing 156 360 43 not on sale not on sale

Dom na Zelejnoj without finishing 161 255 2 3,0 not on sale

Fusion without finishing 156 923 10 not on sale 128 935

GRANI pre-finishing 144 433 3 2,0 121 667

Kingdom pre-finishing 164 202 20 2,3 171 000

Mendel'son pre-finishing 144 914 24 2,6 127 063

Mirozdanie without finishing 198 477 15 3,0 180 000

Ofitserskij Phase 2 without finishing 163 828 3 2,0 150 000

Ostrov without finishing 177 746 23 1,9 160 000

Petrogradets pre-finishing 192 785 4 2,5 sold

Petrovskaya without finishing 182 930 23 not on sale no in the project riv'era

Petrovskij Kvartal without finishing 174 337 48 2,5 190 504 na vode

Prem'er Palas Housing 3-2 without finishing 191 778 2 0,4 63 171

Prem'er Palas Housing 4-2 without finishing 153 112 3 0,4 146 100

Prem'er Palas Housing 4-3 without finishing 156 136 4 0,4 not on sale

Skandi Klubb Housing 21- pre-finishing 157 305 33 2,0 not on sale 28

Skandi Klubb Housing 31- pre-finishing 148 386 41 2,0 not on sale 39

Source: Knight Frank St Petersburg

The highest rates of sales were recorded in "Skandi Klubb", which is due to rapid pace and quality of construction of residential complex. Comparable with one phase rates of sales were fixed in residential complexes "Petrovskij kvartal na vode" and "Botanica".

In general, the pace of completion of projects depends on reputation of developers. Projects from reliable, well- known developers are implemented faster than projects from little-known companies or developers with a bad reputation.

The average rate of sales in the competitive zone is 16 apartments per quarter, while the rates for the most "successful" projects on the market are much higher and amount to 20-30 apartments per quarter.

Location 4. Tri Vetra

Competitors of the analyzed object are residential complexes located in the southern part of Primorsky district along the Bolshoy Nevki River.

In the analysis aparthotels of investment orientation are not considered – such facilities are rarely able to compete with new projects due to the specifics of planning decisions and another range of potential customers.

The map of competition

Source: Knight Frank St Petersburg Five residential complexes are on sale in the competitive zone. Two objects ("LIFE-Primorsky" and "Stockholm") have similar characteristics to the analyzed project. The closest competitor to the project is "LIFE-Primorsky" (2nd and 3rd phases). In 2017 the competitive zone has been replenished with a new property – "Aviator" on 43, Savushkina St.

The total residential area of sale objects is 67.2 thousand sqm (880 apartments). 78% of the area of the competitive zone is represented in commissioned properties, the remaining objects are sheduled for commissioning by the end of 2018.

Table 10. Characteristics of the competing projects

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats

Aviator Savushkina 43 Pravyj bereg B Dec-18 2 839 40

Dom u Elagina Lipovaya 15 RBI B completed 8 443 128 ostrova

LIFE-Primorsky 2 Phase Primorskij 52 Pioner C+ completed 18 195 280

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats

LIFE-Primorsky 3 Phase Primorskij 52 Pioner C+ Dec-18 8 563 112

Rich'art Club 2 Dibunovskaya 30 Dibunovskaya B+ completed 1 945 16

Rich'art Club 3 Dibunovskaya 34 Dibunovskaya B+ Mar-18 3 154 32

Stockholm Housing 1 Primorskij 46 Setl City B+ completed 13 919 157

Stockholm Housing 2 Primorskij 46 Setl City B+ completed 10 195 115

Source: Knight Frank St Petersburg

There are 5 projects with a total residential area of 260.5 thousand square meters in the competitive zone. Recently it was learned that Setl City purchased the plot previously owned by "Metrica" on 17, Torfyanaya Doroga. The project propably will be on sale during 2018.

Table 11. Perspective projects

Non- Phase/ Res. area, Address Project Developer residential housing sq m status

Kamyshovaya 5 Severnaya Stolitsa - - 6 872 Development

Primorskij 169 Lahta plaza Konkord + 21 840

Torfyanaya doroga 17 - Setl City - 150 000

Primorskij 50A - Markus + 78 200

Savushkina 114 - Torgovyj dom Astana + 3 600

Source: Knight Frank St Petersburg

Average prices in the objects of the competitive zone ranges from 133.7 to 220.9 thousand rubles/sqm.

The lowest price was fixed in 2nd phase "LIFE-Primorsky" – the object belongs to C+ ("medium"), mainly no-view apartments are still on sale.

The maximum price is fixed in residential complex "Stockholm" due to available apartments with a view.

The average price in the competitive zone is 177.4 thousand rubles/sqm. The average price increased by 4% compared to 2016 mainly due to the growth of construction completion of the facilities.

Table 12. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ Finishing Av. Sold units Parking, mln Commercial housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Aviator without finishing 161 097 3 1,3 156 610

Residential Șomplex Phase/ Finishing Av. Sold units Parking, mln Commercial housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Dom u Elagina ostrova without finishing 152 950 11 3,7 not on sale

LIFE-Primorsky 2 Phase pre-finishing 133 753 28 1,6 184 217

LIFE-Primorsky 3 Phase full 144 717 8 1,6 no in the project

Rich'art Club 2 pre-finishing 202 710 0,4 2,5 not on sale

Rich'art Club 3 without finishing 201 830 1 1,8 not on sale

Stockholm Housing 1 without finishing 201 074 5 2,5 not on sale

Stockholm Housing 2 without finishing 220 879 4 2,5 not on sale

Source: Knight Frank St Petersburg

The average rate of sales in the competitive zone is 8 apartments per quarter. However, there are objects with significantly higher indicator due to the lower cost of apartments in comparison wih other objects in the competitive zone ("LIFE-Primorsky"). Low liquid objects with any dificiencies show a lower average sales rate in the competitive zone.

Location 5. NEO

Competitors of the analyzed object are B-class residential complexes in Moskovsky district south of the railroad line.

The map of competition

Source: Knight Frank St Petersburg

Six B and C+ class residential complexes are on sale in the analyzed location. Residential complex "Graf Orlov" has a reputation of "long-term construction" despite the wide range of relatively low-cost apartments, so only commissioned buildings of the property can be competitive.

In 2017 a new unique project "Barcelona" with architecture in Gaudi style was added in the competitive zone. Besides, the remaining phases of residential complex "Graf Orlov" are finally on sale.

The total area of sale objects is 231.5 thousand sqm or 3.3 thousand apartments. About half of the competing projects are commissioned, 27% of which are sheduled for commissioning by the end of 2018.

Table 13. Characteristics of the competing projects

Residential Phase/ housing Address Developer Cla Deadline Res. Number Șomplex ss area, sq of flats m

Barcelona Moskovskoe 16 Dom na Lensoveta B+ Mar-20 7 894 84

Graf Orlov Housing 3, 4 Moskovskij 186 L1 B completed/ 26 248 310 Sep-22

Graf Orlov Housing 3ǩ, 4ǩ Moskovskij 186 L1 B Jun-18 24 133 434

Graf Orlov Housing 5 Moskovskij 186 L1 B+ completed 6 678 47

Graf Orlov Housing 7, 7ǩ, Moskovskij 186 L1 B Sep-22 46 283 649 Ǩ, 7ǧ, 8, 8ǧ, 8Ǩ, ǩ

Grand Kosmonavtov 63 PPK C+ completed 32 749 474 Familiya

Green Pulkovskoe 30 Mirland C+ Dec-18 7 425 132 Tower Development

Moskovskij 2 Phase Moskovskij/ Silovye mashiny- C+ completed 49 108 658 kvartal Varshavskaya development

Moskva Kostyushko 19 Setl City B Sep-18 31 004 473

Source: Knight Frank St Petersburg

There are 8 perspective projects with a total residential area of about 212.7 thousand square meters in the competitive zone. The property on 15, Vitebskij Av. (developer Setl City) is the most likely to go on sale. There are no B-Class perspective projects nearby the analyzed object, except for a small building in "Graf Orlov".

Table 14. Perspective projects

Res. area, sq Address Project Phase/ housing Developer m

Altajskaya 39 - Polis grupp 14 000

Blagodatnaya 57 Dom u parka 3S Development 10 900

Vitebskij 15 - Setl City 22 015

Moskovskij 109-111 - Project in sale 22 469

Moskovskij/ Ligovskij - Confidential 54 000

Moskovskij 185 Graf Orlov Phase 3 L1 6 734

Moskovskij 65/2 - Meridian development 67 500

Moskovskij 72 - Rostekh 15 130

Source: Knight Frank St Petersburg

Average prices in the objects of the competitive zone ranges from 118 to 165 thousand rubles/sqm. The minimum prices are fixed in residential complex "Green Tower", because the object relates to C+-class ("medium") residential real estate. The maximum prices are fixed in the project "Grand Familiya", because apartments are commissioned with pre-finishing.

The average supply price in the competitive zone increased by 3% compared to 2016 and is currently 140.5 thousand rubles/sqm.

Table 15. Average price, average rate of sales of the competition projects

Residential Phase/ housing Finishing Av. price, Sold Parking, Commercial Șomplex rub per sq units mln rub premises: m per av. price, quarter rub per sq m

Barcelona without finishing 145 166 8 not on sale not on sale

Graf Orlov Housing 3, 4 without finishing 127 343 16 not on sale 108 332

Graf Orlov Housing 3ǩ, 4ǩ without finishing 128 991 10 not on sale 103 684

Graf Orlov Housing 5 without finishing 159 913 5 not on sale not on sale

Graf Orlov Housing 7, 7ǩ, without finishing 123 273 6 not on sale not on sale Ǩ, 7ǧ, 8, 8ǧ, 8Ǩ, ǩ

Grand Familiya pre-finishing 164 949 9 2,0 not on sale

Green Tower pre-finishing 118 279 11 not on sale not on sale

Moskovskij 2 Phase without finishing 139 602 21 1,9 189 860 kvartal

Moskva without finishing 156 522 35 1,5 not on sale

Source: Knight Frank St Petersburg

The average rate of sales in the competitive zone is 14 apartments per quarter. The highest rates of sales are recorded in residential complexes "Moskva" and "Moskovskij kvarval" – 20-35 apartments in the quarter. This is due to the low absolute cost of apartments and a significant number of small apartments.

Location 6. 3 Moskovskoe (hotel)

Competitors of the analyzed object are apartment complexes in Moskovsky and Frunzensky districts.

The map of competition

Source: Knight Frank St Petersburg

There are 3 aparthotels for sale in the analyzed location, two of them are investment objects, 1 – in "Graf Orlov" is an analog of non-residential apartments.

The closest property to the analyzed project is residential complex "Salut" on the corner of Dunayskogo Av. and Pulkovskoye Highway. Three phases of "Salut" have already been constructed and commissioned.

The total residential area of sale objects is 60.4 thousand sqm or 2.2 thousand apartments.

Table 16. Characteristics of the competing projects

Complex Phase/ housing Address Developer Clas Deadlin Res. Numbe s e area, sq r of m units

Graf Housing 3ǩ, 4ǩ Moskovskij 185 L1 B Jun-18 2 401 72 Orlov

Salut 4 Phase -5 ȤșȇȖ (ȑȕȗ Moskovskoe/Dunajs SoyuzInvestDevelop C Mar-20 14 673 500 5.2) kij ment

Valo Housing 1 (section 1,2) Salova 61/A Gals C Mar-20 21 327 750

Valo Housing 1 (section 3,4) Salova 61/A Gals C Mar-20 21 968 795

Source: Knight Frank St Petersburg

There are 13 perspective projects with a total area of about 272.4 thousand square meters in the competitive zone. The closest properties to the analyzed project are 3 aparthotels – new phase of "Salut", the project of NAI Becar on 44, Ordzhonikidze St. and the project of Plaza Lotus Group on 101, Vitebskij Av.

Table 17. Perspective projects

Res. area, sq District Address Project Phase/ housing m

Moskovskij Vitebskij 101 Vitebskij Plaza Lotus Grupp 75 396

Moskovskij Zaozernaya 1 - RBI 9 265

Frunzenskij Kamchatskaya 3 - Sofit

Moskovskij Kievskaya 14 - Project in sale

Moskovskij Leninskij 153 - Lider grupp 12 052

Frunzenskij Ligovskij 127 - VK logistik 300

Moskovskij Lyubotinskij 5 - NAI Becar

Moskovskij Moskovskij/ Ligovskij - Confidential 2 748

Moskovskij Moskovskij 97 - Polis Grupp 3 694

Moskovskij Moskovskoe/Dunajskij Salut SoyuzInvestDevelopment 12 000

Moskovskij Ordzhonikidze 44 - NAI Becar 100 000

Frunzenskij Salova 61/A Valo Arena development 56 996

Moskovskij CHernigovskaya 8 lit.K - ADM Nedvizhimost'

Source: Knight Frank St Petersburg

Average prices in the objects ranges from 98.3 to 114.4 thousand rubles/sqm. The minimum prices are presented in aparthotel "Salut", the maximum – in residential complex "Graf Orlov".

The average supply price in the competitive zone increased by 3% compared to 2016 and is currently 106.9 thousand rubles/sqm.

Table 18. Average price, average rate of sales of the competition projects

Residential Phase/ housing Finishing Av. Sold units Parking, Commercial Șomplex price, per mln rub premises: av. rub per quarter price, rub sq m per sq m

Graf Orlov Housing 3ǩ, 4ǩ without finishing 114 441 26 not on sale not on sale

Salut 4 Phase - 5 ȤșȇȖ (ȑȕȗ 5.2) full 98 309 41 not on sale 130 000

Valo Housing 1 (section 1,2) full 102 659 97 not on sale 183 386

Valo Housing 1 (section 3,4) full 112 311 34 not on sale not on sale

Source: Knight Frank St Petersburg

The average rate of sales for competing aparthotels is 50 units per quarter. The highest rates of sales are recorded in "Valo" – the facility is well located within walking distance from the metro and relatively comfort distance from the center (the area of the Moscow railway station, which can be reached by land transport in 25- 30 minutes).

Location 7. Morskoy Fasad

The competitive zone is basically Vasileostrovsky district of St. Petersburg. The main competitors of the project are residential complexes, which are being constructed in the alluvial territories. Apartment projects are considered as objects of indirect competition.

The map of competition

Source: Knight Frank St Petersburg

There are currently 2 residential complexes and 1 aparthotel (non-service format) for sale in the alluvial territories. In total, 6 B-class properties, 5 C-class properties and 4 apartments are being constructed in the district.

The total residential area of sale objects is 380.4 thousand sqm or 7.1 thousand apartments.

Table 19. Characteristics of the competing projects

Residential Phase/ housing Address Developer Non- Cla Deadline Res. Number Șomplex residen ss area, sq of flats tial m status 24 29 1 Phase 24 liniya 29 NordEst - C+ complete 6 237 85 d Delagardi 14 liniya 57-61 Nevskij - B+ Dec-18 3 666 36 al'yans Dve Epohi Housing ǧ, Ǩ 18 liniya 49-53 EKE - B+ Dec-18 24 938 317 Fjord Housing 1, 2 Malyj 52 YIT - B complete 26 069 388 d Golden City Housing 1, 2 Nevskaya guba Glorax - C+ Mar-20 29 092 573 Developm ent MONODOM na 1 Phase Malyj 63/14 Sun - C+ Mar-19 9 356 194 Malom Developm ent Neva-Neva 24 liniya 25 Basis SPb - B Dec-20 18 650 278

Residential Phase/ housing Address Developer Non- Cla Deadline Res. Number Șomplex residen ss area, sq of flats tial m status Palatsio Housing 1 25 liniya 8 Setl City - C+ Sep-24 64 112 1 299 Palatsio Housing 2 25 liniya 8 Setl City - C+ Sep-24 73 117 1 480 Samotsvety Housing 3 Ural'skaya 2-4 Etalon - B Mar-18 34 218 562 Group Samotsvety Housing 4 Ural'skaya 2-4 Etalon - B complete 13 229 195 Group d Vasil'evskij kvartal section ǧǨ Nahimova/Nalic Gornyj - B+ complete 8 540 88 hnaya institut d Vasil'evskij kvartal section Ǭǭ Nahimova/Nalic Gornyj - B+ complete 7 119 80 hnaya institut d Vasil'evskij kvartal section ǻ Nahimova/Nalic Gornyj - B+ complete 8 245 60 hnaya institut d YA-Romantik Housing 8-9 Nevskaya guba Seven - C Dec-18 53 864 1 491 Suns Indirect competitors Cruise Apart (YA- Housing 10/2 Nevskaya guba Seven + C Mar-19 44 003 748 Romantik) Suns Docklands Housing 2 (Club) KIMa 19 Baltijskij + B Dec-19 4 514 54 monolit Docklands Housing 1-1 KIMa 19 Baltijskij + B Dec-19 7 720 148 (Vasylevsky) monolit Docklands Housing 1-3 KIMa 19 Baltijskij + B Dec-19 5 594 115 (Family) monolit Docklands Housing 3 (ȈȒȕȑ KIMa 19 Baltijskij + B complete 19 038 386 1,2) monolit d Loft na Srednem Housing 2, 3 Srednij 85 Baltijskij + B Dec-18 5 672 103 monolit NEXT Housing 1-3 Srednij 87 Evrostroj + B+ Mar-19 17 397 432

Source: Knight Frank St Petersburg

There are 29 perspective projects with a total residential area of about 1.07 million sqm in Vasileostrovsky district: 15% of them are apartments, 30% of the area is in the alluvial territories, and more than 30% of the area is the redevelopment of the former industrial territories.

Table 20. Perspective projects

Non- Phase/ Res. area, Address Project Developer residential housing sq m status

11 liniya 56 Serdtse ostrova Confidential - 9 259

12 liniya 41 - Confidential - 18 013

Non- Phase/ Res. area, Address Project Developer residential housing sq m status

13 liniya 50 - Vinteko - 8 140

20 liniya 5-7 Malen'kaya AAG - 13 894 Frantsiya

23 liniya 2 - NISK - 49 000

24 liniya 31 - Indest Development - 7 592

4 liniya 35-37 - Brabus - 2 271

8 liniya 77 - Fiz. Litso +

Beringa 27/6 Dom na Pal'mira (ZHilishchnyj - 7 648 Smolenke kapital)

Bol'shoj 50 - Confidential - 1 000

Bol'shoj 69/ 20 liniya 19 - Fazer Group - 10 855

V.SHefnera YA-Romantik ȑ.12-13 Seven Suns - 66 023

Korablestroitelej 28 - LSEG + 1 800

Michmanskaya - Navis + 113 538

Morskaya nab. Tihaya gavan' Seven Suns - 60 221

Morskaya nab. Kolumb (Gavan' Lider Grupp - 40 000 kapitanov)

Morskaya nab. Magellan (Gavan' Lider Grupp - 40 000 kapitanov)

Nalichnaya 103 Morskaya Gazprom - 118 386 rezidentsiya

Nalichnaya 44/1 - Dal'piterstroj + 11 781

Nevskaya guba Golden City Glorax Development - 128 397

Odoevskogo 10 - Lider Grupp + 17 656

Smolenki 19/21 - Teorema - 42 500

Smolenki/ - Plaza Lotus Grupp + Korablestroitelej

Srednij 69B - TD Granit + 697

Srednij 2 - Terra Development - 6 000

Universitetskaya 23 - Azalit + 2 550

Ural'skaya 21 - Setl City - 56 100

Non- Phase/ Res. area, Address Project Developer residential housing sq m status

SHkiperskij 18 - Grad-Invest - 61 700

SHkiperskij 19A - Almaz-Antej - 166 972

SHkiperskij 19A - Almaz-Antej + 8 050

Source: Knight Frank St Petersburg

Average prices in competitive objects ranges from 83.2 thousand rubles/sqm in economy class complex "YA- Romantik" to 216.5 thousand rubles/sqm in business class complex "Vasil’evskij kvartal".

The average supply price in the competitive zone in B-class properties is 161.1 thousand rubles/sqm, in C- class properties – 114 thousand rubles/sqm. In aparthotels the average price is 139.8 thousand rubles/sqm.

Table 21. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ housing Finishing Av. Sold Parking, mln Commercial price, units per rub premises: av. rub per quarter price, rub per sq m sq m

24 29 1 Phase without 118 017 2 2,0 not on sale, rent finishing only

Delagardi without 163 579 1 not on sale not on sale finishing

Dve ehpohi Housing ǧ, Ǩ pre-finishing 154 504 25 0,6 160 000

Fjord Housing 1, 2 pre-finishing 147 387 28 1,8 50 892

Golden City Housing 1, 2 without 96 250 69 not on sale not on sale finishing

MONODOM na 1 Phase without 126 309 22 2,2 147 700 Malom finishing

Neva-Neva without 144 421 start of not on sale not on sale finishing sales

Palatsio Housing 1 full 129 376 151 1,0 146 000

Palatsio Housing 2 full 130 759 32 1,0 135 000

Samotsvety Housing 3 without 123 459 17 1,4 158 015 finishing

Samotsvety Housing 4 without 121 292 18 1,4 151 920 finishing

Vasil'evskij kvartal section ǧǨ without 201 736 3 not on sale, rent not on sale finishing only

Residential Șomplex Phase/ housing Finishing Av. Sold Parking, mln Commercial price, units per rub premises: av. rub per quarter price, rub per sq m sq m

Vasil'evskij kvartal section Ǭǭ without 177 033 1 not on sale, rent not on sale finishing only

Vasil'evskij kvartal section ǻ without 216 523 2 not on sale, rent not on sale finishing only

YA-Romantik Housing 8-9 full 83 220 157 0,8 130 000

Indirect competitors

Cruise Apart (YA- Housing 10/2 full 70 582 81 0,8 130 000 Romantik)

Docklands Housing 2 (Club) full 174 951 10 not on sale not on sale, rent only

Docklands Housing 1-1 full 118 473 16 not on sale not on sale, rent (Vasylevsky) only

Docklands Housing 1-3 full 135 764 5 not on sale not on sale, rent (Family) only

Docklands Housing 3 (ȈȒȕȑ full 163 654 15 2,8 not on sale, rent 1,2) only

Loft na Srednem Housing 2, 3 full 169 120 9 1,7 160 000

NEXT Housing 1-3 different 146 069 2 not on sale 150 000

Source: Knight Frank St Petersburg

The average rate of sales for competing objects is 38 apartments per quarter. The highest rates of sales are recorded in "YA-Romantik" and "Palatsio" – more than 150 apartments per quarter, which is due to the low absolute cost of apartments and a significant number of apartments of a small footage.

Location 8. Chernaya Rechka

Competitors of the analyzed object are B and C+ class residential complexes in the southern part of Primorsky district, in Vyborgsky district on Lesnoy and B. Sampsonievskij Av. and in the northern part of the Petrograd Side.

The map of competition

Source: Knight Frank St Petersburg

There are 9 residential complexes with total residential area of 206.7 thousand sqm (3.2 thousand apartments) in the competitive zone. Three objects have already been commissioned – 15% of the area, 3 more objects (3% of the area) are planned to be commissioned before the end of 2018. A significant share of the areas will be commissioned in 2019-2020.

Table 22. Characteristics of the competing projects

Residential Phase/ Address Developer Class Deadline Res. Number Șomplex housing area, of flats sq m

Aviator Savushkina 43 Pravyj bereg B Dec-18 2 839 40

Botanica Aptekarskij 5 Etalon Group B+ Dec-19 28 445 356

Dom u Elagina Lipovaya 15 RBI B completed 8 443 128 ostrova

Fusion Krapivnyj 4 Etalon Group B Mar-18 9 555 110

G9 Gribalevoj 9 KVS C Dec-19 15 000 316

Georg Landrin B.Sampsonievskij 77 Absolyut Stroj B Apr-20 27 692 451

LIFE-Lesnaya Housing Novolitovskaya 10-12 Pioner C+ Sep-20 27 656 480 1.1, 1.2

LIFE-Lesnaya Housing 2.1 Novolitovskaya 10-12 Pioner C+ Dec-20 29 633 467

LIFE-Lesnaya Housing 2.2 Novolitovskaya 10-12 Pioner C+ Sep-20 12 262 209

Rich'art Club 2 Dibunovskaya 30 Dibunovskaya B+ completed 1 945 16

Rich'art Club 3 Dibunovskaya 34 Dibunovskaya B+ Mar-18 3 154 32

Skandi Klubb Housing Aptekarskij 16 Bonava B completed 19 526 291

Residential Phase/ Address Developer Class Deadline Res. Number Șomplex housing area, of flats sq m

21-28

Skandi Klubb Housing Aptekarskij 16 Bonava B Sep-20 20 534 301 31-39

Source: Knight Frank St Petersburg

There are 12 perspective projects with a total residential area of about 1 million sqm in the competitive zone. Close to the analyzed object there are several large projects from such developers as YUIT, CDS and Etalon Group.

Table 23. Perspective projects

Res. area, sq Phase/ District Address Project Developer m housing

Vyborgskij B.Sampsonievskij 66 - Setl City 119 000

Vyborgskij B.Sampsonievskij 68 Novyj Otdelstroj 1, 2 Phase 120 000 Lessner

Vyborgskij B.Sampsonievskij 77 Georg Absolyut Stroj 2 Phase 43 523 Landrin

Primorskij Beloostrovskaya 13 - Confidential 37 151

Primorskij Beloostrovskaya 28 - Etalon Group 31 850

Primorskij Beloostrovskaya 9 - Bazis SPb 31 660

Primorskij Beloostrovskaya/Studencheskij/Kra - TSDS 240 000 snogvardejskij

Vyborgskij Vyborgskaya 55 MOST GTC 25 000 Building

Primorskij Zemledel'cheskaya 3 - RosStrojInvest 12 690

Vyborgskij Kantemirovskaya 11 - Klimov 77 417

Primorskij Kolomyazhskij 13 Primorskij Megalit i Ohta 228 549 kvartal Grupp

Primorskij Studencheskaya 24 Tarmo YUIT 40 360

Source: Knight Frank St Petersburg

Average prices in the objects of the competitive zone ranges from 101 to 202.7 thousand rubles/sqm. The highest prices were fixed in commissioned residential property "Rich'art Club 2". The minimum prices for location were recorded in the large-scale residential complex "Georg Landrin" on 77, B. Sampsonievskij Av.

The average price in the competitive zone is 147.5 thousand rubles/sqm.

Table 24. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ Finishing Av. Sold units Parking, mln Commercial housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Aviator without finishing 161 097 3 1,3 156 610

Botanica without finishing 156 360 43 not on sale not on sale

Dom u Elagina ostrova without finishing 152 950 11 3,7 not on sale

Fusion without finishing 156 923 10 not on sale 128 935

G9 full 128 090 25 not on sale not on sale

Georg Landrin without finishing 101 085 69 0,7 not on sale

LIFE-Lesnaya Housing 1.1, 1.2 different 116 835 95 not on sale not on sale

LIFE-Lesnaya Housing 2.1 pre-finishing 115 226 45 not on sale 200 000

LIFE-Lesnaya Housing 2.2 pre-finishing 119 099 19 not on sale 200 000

Rich'art Club 2 pre-finishing 202 710 0 2,5 not on sale

Rich'art Club 3 without finishing 201 830 1 1,8 not on sale

Skandi Klubb Housing 21-28 pre-finishing 157 305 33 2,0 not on sale

Skandi Klubb Housing 31-39 pre-finishing 148 386 41 2,0 not on sale

Source: Knight Frank St Petersburg

The average rate of sales for competing objects is 30 apartments per quarter for 1 project/phase. At the same time the maximum rate of sales was fixed in LIFE-Lesnaya – about 160 apartments per quarter in all phases. High rates of commissioning are due to small cost of apartments for compact areas and a good reputation of the developer.

Location 9. Bogemiya

The competitors of the analyzed project are located along Moskovsky Avenue near the metro station "Frunzenskaya". B-class residential complexes, which are currently under constrction, are located along Ligovsky Avenue, south of the metro station "Obvodnyy Kanal".

The map of competition

Source: Knight Frank St Petersburg

There are 5 residential complexes on sale in the competitive zone. The closest competitor is residential complex "Time. Dom u Moskovskogo" (Group RBI), which was commissioned in 2017. Less than 5% of the apartments are currently on sale. All other properties nearby the metro station "Frunzenskaya" refer primarily to C+ class residential real estate.

All B-class objects in the competitive zone are located in a far distance from the project – residential complex "LOOK" (developer PSK) near the metro station "Obvodnyy Kanal" and "Moskovskie Vorota" near the metro station "Moskovskie Vorota".

The total residential area of sale objects is 309.8 thousand sqm (6 thousand apartments). The supply decreased by 26% compared with 2016 due to completion of sales in three facilities.

Table 25. Characteristics of the competing projects

Residential Phase/ housing Address Developer Class Deadline Res. area, Num Șomplex sq m ber of flats

Dom na Kievskaya 5 EHl'ba C Jun-18 11 709 258 Kievskoj

Galaktika Housing 4.11 Krasutskogo Etalon Group C+ Dec-20 17 423 377

Galaktika Housing 4.5-1, Krasutskogo Etalon Group C+ Jun-19 19 453 390 4.5-2

Galaktika Housing 8.1-1 M.Mitrofan'evska Etalon Group C+ Sep-20 14 895 301 ya

Galaktika Housing 8.2-1, M.Mitrofan'evska Etalon Group C+ Jun-20 62 997 1 128 8.2-2, 8.2-3, 8.2- ya 4

Galaktika Housing 8.5-1, M.Mitrofan'evska Etalon Group C+ Dec-18 25 185 550 8.5-2 ya

Galaktika Housing 8.7-1, M.Mitrofan'evska Etalon Group C+ Jun-20 25 300 533 8.7-2, 8.7-3 ya

LOOK Prilukskaya 20 PSK B Jun-18 5 945 96

Moskovskie Housing 4 Moskovskij 115 Etalon Group B complete 30 233 489 vorota d

Vremena goda Housing 2 Moskovskij 65 Petropol' C+ complete 26 934 514 (Meridian d development)

Vremena goda Housing 3 Moskovskij 65 Petropol' C+ complete 28 795 558 (Meridian d development)

Vremena goda Housing 4 Moskovskij 65 Petropol' C+ complete 27 189 580 (Meridian d development)

Vremena goda Housing 5 Moskovskij 65 Petropol' C+ complete 13 766 255 (Meridian d development)

Source: Knight Frank St Petersburg

There were a number of changes in the competitive zone in 2017. The project on 65, Moskovskij Av. was previously planned to be developed by the Kazakh developer "BI Group", but then was purchased by "Akvilon- Invest" developer from Arkhangelsk. At the same time, the residential complex "Galaktika" (Etalon Group)

remains the major project in the competitive zone, in which more than 600 thousand sqm of residential area still remains not put up on sale.

The total residential area of perspective projects is 938.2 thousand sqm.

Table 26. Perspective projects

Non- Res. area, District Address Project Developer residential sq m status

Moskovskij Voronezhskaya 45 BFA-Development - 4 491

Moskovskij Detskij 5 - RBI - 11 106

Moskovskij Zaozernaya 1 - RBI + 9 265

Moskovskij Moskovskij - Confidential - 54 000

Moskovskij Moskovskij 109-111 - Project in sale - 22 469

Admiraltejskij Moskovskij 65 lit.E - Meridian development - 15 655

Admiraltejskij Moskovskij 65/2 - Meridian development - 67 500

Moskovskij Moskovskij 72 - Rostekh - 15 130

Admiraltejskij Moskovskij 83 Art Kvartal Akvilon-Invest - 57 082

Moskovskij Obvodnogo 118B - Project in sale - 8 792

Admiraltejskij Obvodnyj-Moskovskij Galaktika Gruppa Etalon - 672 747

Source: Knight Frank St Petersburg

The average price in the competitive zone ranges from 106.6 to 151.8 thousand rubles/sqm. The lowest price is fixed in residential complex "Galaktika". Because of the project’s scale the developer keeps a low price level to maintain high sales rates. The maximum price is presented in the commissioned building "Vremena goda".

The average price in the competitive zone is 126 thousand rubles/sqm, which is 2% less than in 2016.

Table 27. Average price, average rate of sales of the competition projects

Residential Phase/ housing Finishing Av. price, Sold Parking, mln rub Commercia Șomplex rub per units l premises: sq m per av. price, quarte rub per sq r m

Dom na Kievskoj pre-finishing 114 176 17 not on sale 130 000

Galaktika Housing 4.11 without finishing 118 736 75 not on sale 134 501

Galaktika Housing 4.5-1, 4.5- without finishing 111 524 24 0,8 140 281 2

Galaktika Housing 8.1-1 without finishing 106 632 57 not on sale not on sale

Galaktika Housing 8.2-1, 8.2- without finishing 111 549 108 not on sale 130 707

Residential Phase/ housing Finishing Av. price, Sold Parking, mln rub Commercia Șomplex rub per units l premises: sq m per av. price, quarte rub per sq r m

2, 8.2-3, 8.2-4

Galaktika Housing 8.5-1, 8.5- without finishing 109 363 144 not on sale 136 489 2

Galaktika Housing 8.7-1, 8.7- without finishing 120 355 8 not on sale not on sale 2, 8.7-3

LOOK without finishing 141 804 12 2,8 not on sale

Moskovskie Housing 4 without finishing 136 406 45 not on sale 150 000 vorota

Vremena goda Housing 2 pre-finishing 138 306 25 1,5 176 000

Vremena goda Housing 3 pre-finishing 146 994 39 1,5 not on sale

Vremena goda Housing 4 pre-finishing 151 776 16 1,5 169 000

Vremena goda Housing 5 pre-finishing 130 147 11 1,4 150 000

Source: Knight Frank St Petersburg

The average rate of sales in the competitive zone is 45 apartments per quarter. At the same time, the rate of sales in residential complex "Galaktika" is much higher than the average due to compact layouts and minimum cost of apartments.

Location 10. Yuzhnaya Aquatoriya

The competitive zone basically represents one large microdistrict in the southwest of St. Petersburg and also a new location in the area of Budyonnogo Av. Also residential complexes in the area of Veteranov Avenue are considered.

Eleven residential complexes correspond to these requirements. The number of objects in the location increased by 10% compared with 2016. As a result, the total residential area of sale objects is 842.6 thousand sqm or 18.3 thousand apartments. The following projects are on sale: "Aist", "LEGENDA Geroev" and new phases in the complexes "Anglijskaya milya", "Solnechnyj gorod" and "Ogni zaliva".

The map of competition

Source: Knight Frank St Petersburg

Most of the projects in the competitive zone are C-class residential real estate and are oriented primarily to mass demand. Flotography in objects-competitors is presented mainly by small 1-room apartments and studios.

In general, the objects in this location are highly competitive, especially projects of complex development of territories.

Table 28. Characteristics of the competing projects

Residential Phase/ Address Developer Cla Deadline Res. Number Șomplex housing ss area, sq of flats m

Aist Veteranov/ Krasnaya strela C+ Dec-19 9 100 153 Tambasova

Anglijskaya milya 3 Phase Petergofskoe 78/6 Glorax C Dec-20 70 463 1 536 Development

Anglijskaya milya Housing 1-5 Petergofskoe 78/6 Glorax C Jun-19 43 970 995 Development

Anglijskaya milya Housing 6 Petergofskoe 78/6 Glorax C Jun-18 5 656 105 Development

Baltijskaya volna 3,4 M.Kazakova/Kuznets Rant C Mar-18 35 640 752

Residential Phase/ Address Developer Cla Deadline Res. Number Șomplex housing ss area, sq of flats m

ova

Kleny - Petergofskoe 86/3 Petropol' C May-19 27 456 617

LEGENDA Geroev Housing 1, 2 Geroev/ LEGENDA C+ Dec-19 33 313 588 Dudergofskij kanal

Ogni zaliva Housing 10, Leninskij BFA-Development C+ complete 109 553 2 120 11, 12 d

Ogni zaliva Housing 14 Leninskij BFA-Development C+ Feb-20 34 362 651

Ogni zaliva Housing 15 Leninskij BFA-Development C+ Feb-20 34 380 651

Polezhaevskij Housing S.Korzuna/ZHukova Kompakt C+ complete 28 962 527 park 1,2,3 d

Prem'era Tambasova 5 Tekhnopolis C Dec-18 12 542 252

Solnechnyj gorod Housing 5 Sankt- Setl City C Mar-18 59 603 1 684 (site 79) Peterburgskoe/ Krasnosel'skoe/ Budennogo

Solnechnyj gorod Housing 7 Sankt- Setl City C Jun-19 87 878 2 594 (site 51) Peterburgskoe/ Krasnosel'skoe/ Budennogo

Solnechnyj gorod Housing 8 Sankt- Setl City C Dec-19 99 015 2 829 Peterburgskoe/ Krasnosel'skoe/ Budennogo

ZHemchuzhnyj Housing 1 Matisov kanal Baltijskaya C+ Dec-19 16 782 270 bereg ZHemchuzhina

ZHemchuzhnyj 2 Phase Admirala Baltijskaya C+ complete 63 981 1 003 fregat Konovalova, uch.1 ZHemchuzhina d

ZHemchuzhnyj 3 Phase Admirala Baltijskaya C+ complete 63 327 1 021 fregat Konovalova, uch.1 ZHemchuzhina d

Source: Knight Frank St Petersburg

The total area of perspective projects in the competitive zone is 2.9 million sqm. Most of the areas are concentrated in the location of Budyonnogo Av. nearby the analyzed project.

Table 29. Perspective projects

Developer Address Project Res. area, sq m

A.Tributsa/ Matisov kanal, uch.1 - Baltijskaya zhemchuzhina 25 396

A.CHerokova/ Geroev, uch.2 - Baltijskaya zhemchuzhina 57 147

A.CHerokova/ Geroev, uch.3 - Baltijskaya zhemchuzhina 83 645

A.CHerokova/ Geroev, uch.4 - Baltijskaya zhemchuzhina 75 084

Veteranov/ Tambasova - Int development 15 868

Veteranov/L.Pilyutova/CHekistov Sosnovaya polyana 1- Renovatsiya SPb 218 820 5

Geroev/ Dudergofskij kanal Legenda Geroev LEGENDA 33 162

Krasnosel'skoe sh. Novo Sergievo Satellit-Development 1 037 000

Leninskij Ogni zaliva BFA-Development 303 105

Matisov kanal ZHemchuzhnyj bereg, Baltijskaya ZHemchuzhina 47 218 k.2-6

Matisov kanal Nautilus KVS 44 062

Patriotov uch. 1 - Baltijskaya zhemchuzhina 16 000

Patriotov uch. 2 - Baltijskaya zhemchuzhina 14 000

Petergofskoe 78/6 Anglijskaya milya, 4 Glorax Development 69 860 och.

Sankt-Peterburgskoe/ Krasnosel'skoe/ Solnechnyj gorod Setl City 894 935 Budennogo

Tambasova 5 - Pragma 9 489

Tambasova 5 Prem'era Tekhnopolis 17 943

Source: Knight Frank St Petersburg

Competitors are comparable to the analyzed project by their location and transport facilities. All the properties are far from metro stations, with lack of social and commercial infrastructures. Transport facilities in new microdistricts of the south-west are limited.

In most of the competing objects apartments are sold with a finishing or pre-finishing. The exceptions are residential complex "Aist" and "Polezhaevskij park".

The average price for the competitive zone is 91.7 thousand rubles/sqm. It increased by 5% compared with 2016 due to the sale of more expensive projects (for example, "LEGENDA Geroev").

Table 30. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ housing Finishing Av. price, Sold units per Parking, mln Commercial rub per sq quarter rub premises: av. m price, rub per sq m

Aist without finishing 86 617 start of sales 1,0 not on sale

Anglijskaya milya 3 Phase pre-finishing 88 729 77 0,6 not on sale

Anglijskaya milya Housing 1-5 pre-finishing 85 231 80 0,6 not on sale

Anglijskaya milya Housing 6 pre-finishing 90 754 10 0,6 not on sale

Baltijskaya volna 3,4 pre-finishing 84 329 22 1,3 not on sale

Kleny - different 78 501 17 not on sale not on sale

LEGENDA Geroev Housing 1, 2 full 116 519 46 0,6 198 929

Ogni zaliva Housing 10, 11, 12 full 97 435 112 0,5 not on sale

Ogni zaliva Housing 14 full 88 764 21 not on sale not on sale

Ogni zaliva Housing 15 full 82 667 start of sales not on sale not on sale

Polezhaevskij park Housing 1,2,3 without finishing 99 745 32 not on sale 100 000

Prem'era full 95 265 24 not on sale not on sale

Solnechnyj gorod Housing 5 (site 79) full 85 435 83 0,5 not on sale

Solnechnyj gorod Housing 7 (site 51) full 82 168 99 0,5 not on sale

Solnechnyj gorod Housing 8 full 80 667 191 0,5 not on sale

ZHemchuzhnyj bereg Housing 1 pre-finishing 104 304 18 0,7 176 458

ZHemchuzhnyj fregat 2 Phase pre-finishing 96 558 24 0,6 144 568

ZHemchuzhnyj fregat 3 Phase pre-finishing 108 010 27 0,6 160 000

Source: Knight Frank St Petersburg

An absolute sales leader in this location is Setl City developer, which has sold the largest number of apartments in residential complex "Solnechnyj gorod" in a year.

The average rate of sales for the objects of the competitive zone is 55 apartments per quarter.

Location 11. Sofiya, Zvjezdny duet

The competition area is the territory of the southern part of Moskovsky and Frunzensky districts within the borders of Blagodatnaya St., Sofiyskaya St., Ring Road and WHSD. As competitors C-class residential complexes were considered.

One residential complex "Balkany" (Lider Group) is still on sale in Frunzensky district.

There are no commissioned objects on sale in the competitive zone. 15% of the area is planned for commissioning by the end of 2018, 42% – during 2019.

The map of competition

Source: Knight Frank St Petersburg

The total residential area of sale objects increased by 70% and amounted to 508.3 thousand sqm or 12.3 thousand apartments in 2017. The following residential complexes were put up for sale: "Zhizn’", "Filosofiya", "Piter", "Moskovskij" and also new phases in the complexes "4YOU" and "Triumf Park".

Table 31. Characteristics of the competing projects

Residential Phase/ Address Developer Clas Deadlin Res. Numb Șomplex housing s e area, sq er of m flats

4YOU Housing Moskovskoe 13 Akvilon-Invest C Dec-19 28 095 782 1,2

4YOU Housing Moskovskoe 13 Akvilon-Invest C Dec-19 28 095 782

Residential Phase/ Address Developer Clas Deadlin Res. Numb Șomplex housing s e area, sq er of m flats

3,4

4YOU Housing 5 Moskovskoe 13 Akvilon-Invest C Dec-20 34 242 1 020

4YOU Housing 6 Moskovskoe 13 Akvilon-Invest C Dec-20 15 835 595

Balkany Budapeshtskaya Lider Group C Dec-19 33 143 723 102

Bau Haus Housing ǧ, Kosmonavtov 102A Bau Siti C Dec-18 20 742 416 ǩ

Dom na Dnepropetrovskaya Etalon Group C+ Sep-18 18 197 312 Kosmonavtov 65

Dve stolitsy Housing 1 Moskovskoe 13 Moskovskij industrial'nyj C Jun-21 47 137 1 086 bank

Filosofiya Housing 1 Predportovyj 11 Setl City C Jun-20 43 217 1 212 1,2

Green Tower Pulkovskoe 30 Mirland Development C+ Dec-18 7 425 132

KosmosStar Kosmonavtov 102 Akvilon-Invest C+ Jun-18 11 150 269

Kremlevskie Tipanova 25 RosStrojInvest C+ Sep-18 21 256 403 zvezdy

Kryl'ya Pulkovskoe 36/4 KVS C Dec-19 14 045 316

Moskovskij Housing 1 Pulkovskoe 30V TSDS C Jun-21 11 427 326

Piter Tipanova 21A Kontsern Piter C+ Jun-21 61 587 1 137

Triumf Park Housing 5 Pulkovskoe 30 Mirland Development C+ Jun-19 64 990 1 510

ZHizn' 1,2 Moskovskoe 13 Seven Suns C Mar-19 47 746 1 279

Source: Knight Frank St Petersburg

The total residential area of declared projects in the competitive zone is 1.7 million sqm. More than 60% of the total area is the project in the former territory of enterprise "Samson" on 13, Moscovskoye highway.

Table 32. Perspective projects

Phase/ Res. area, District Address Project Developer housing sq m

Moskovskij Blagodatnaya 57 Dom u parka Interkontrakt 10 900

Moskovskij Vitebskij 15 - Setl City 22 015

Frunzenskij M.Buharestskaya 9 Novoe Kupchino Stroitel'nyj trest 140 000

Moskovskij Moskovskoe 13 - Moskovskij industrial'nyj 938 894

Phase/ Res. area, District Address Project Developer housing sq m

bank

Moskovskij Moskovskoe 13 Dve stolitsy Housing Moskovskij industrial'nyj 50 589 3,4 bank

Moskovskij Moskovskoe 13 ZHizn' 2 Phase Seven Suns 50 866

Moskovskij Moskovskoe 13 - Akvilon-Invest 41 200

Moskovskij Pulkovskoe 30 Triumf park 6 Phase Mirland Development 217 910

Moskovskij Pulkovskoe 30V Moskovskij 3-5 Phase TSDS 108 458

Moskovskij Pulkovskoe 32 Pulkovskij Pulkovskij mezonin 12 320 Meridian

Moskovskij Tipanova 32 - Lider grupp 124 000

Source: Knight Frank St Petersburg

The average price in the objects of the competitive zone ranges from 68 thousand rubles/sqm in residential complex "Moskovskij" to 134.3 thousand rubles/sqm in "Bau Haus". 80% of apartments are sold with finishing or pre-finishing.

The average price in the competitive zone is 103.9 thousand rubles/sqm. It decreased by 2% compared to 2016 due to the sales with minimum prices ("Moskovskij" and "Zhizn’").

Table 33. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ Finishing Av. Sold units Parking, mln Commercial housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

4YOU Housing 1,2 pre-finishing 104 740 92 0,5 100 000

4YOU Housing 3,4 pre-finishing 97 749 98 0,5 100 000

4YOU Housing 5 pre-finishing 97 016 2 0,5 100 000

4YOU Housing 6 pre-finishing 96 657 1 0,5 100 000

Balkany without finishing 107 731 43 not on sale not on sale

Bau Haus Housing ǧ, ǩ without finishing 134 342 30 not on sale not on sale

Dom na Kosmonavtov without finishing 100 583 29 not on sale 127 500

Dve stolitsy Housing 1 without finishing 85 015 38 not on sale not on sale

Filosofiya Housing 1,2 full 110 976 45 not on sale not on sale

Green Tower pre-finishing 118 279 11 not on sale not on sale

KosmosStar without finishing 119 982 28 not on sale not on sale

Residential Șomplex Phase/ Finishing Av. Sold units Parking, mln Commercial housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Kremlevskie zvezdy pre-finishing 130 914 33 not on sale not on sale

Kryl'ya without finishing 108 542 7 not on sale not on sale

Moskovskij Housing 1 full 68 099 start of sales not on sale not on sale

Piter without finishing 95 863 10 not on sale not on sale

Triumf Park Housing 5 full 103 937 59 not on sale not on sale

ZHizn' 1,2 without finishing 85 924 40 not on sale not on sale

Source: Knight Frank St Petersburg

The minimal rate of sales is fixed in residential complex "Kryl’ya", whose strong competitor is "Triumf Park" with a lower average price per sqm.

The average rate of sales in the competitive zone is 35 apartments per quarter.

Location 12. Kalina-park

The competitive zone is a microdistrict, bounded by a railway line, Marshala Bluchera Ave and adjacent neighbourhoods along the Neva River.

Some of the previously implemented properties have already been constructed and commissioned. At the same time new former industrial areas continue to be developed, where new projects "Kirill i Dar’ya", "Suvorov", LIFE- Lesnaya and "Dom na Blyuhera" appeared in 2017.

The map of competition

Source: Knight Frank St Petersburg

The total residential area of sale objects decreased by 12% in comparison with 2016 and amounted to 392.3 thousand sqm (7.9 thousand apartments).

Most of the projects in the competitive zone are C-class residential properties, 2 projects are "business light" class ("G9" and "Georg Landrin").

About 24% of apartments are offered with a finishing, 41% of apartments are sold with pre-finishing or partial finishing.

Only 14% of areas in the competitive zone are commissioned, 24% are scheduled for commissioning in 2018. Most of the areas are planning to be comissioned in 2019-2020.

Table 34. Characteristics of the competing projects

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats

Dom na M.Blyuhera 4 Etalon Group C Mar-20 76 977 1 455 Blyuhera

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats

Flamingo section 1-3 M.Blyuhera 12 KapStroj C completed 15 791 337 /Laboratornaya

Flamingo section 4-6 M.Blyuhera 12 KapStroj C Mar-18 11 199 239 /Laboratornaya

Fusion Krapivnyj 4 Etalon Group B Mar-18 9 555 110

G9 Gribalevoj 9 KVS C Dec-19 15 000 316

Georg Landrin B.Sampsonievskij 77 Absolyut Stroj B Apr-20 27 692 451

Kirill i Dar'ya Housing 1 M.Blyuhera 12 KVS C Sep-18 11 000 248

Kirill i Dar'ya Housing 2,3 M.Blyuhera 12 KVS C Dec-19 30 000 623

Landyshi Housing 1 Polyustrovskij/ Etalon Group C completed 29 978 689 Mendeleevskskaya

LIFE-Lesnaya Housing 1.1, Novolitovskaya 10-12 Pioner C+ Sep-20 27 656 480 1.2

LIFE-Lesnaya Housing 2.1 Novolitovskaya 10-12 Pioner C+ Dec-20 29 633 467

LIFE-Lesnaya Housing 2.2 Novolitovskaya 10-12 Pioner C+ Sep-20 12 262 209

Marshal Housing 1-1 M.Blyuhera/Kondrat'evs L1 C Dec-18 30 575 716 kij 58

Marshal Housing 2-1 M.Blyuhera/Kondrat'evs L1 C Dec-18 32 283 756 kij 58

Pifagor M.Blyuhera 12 Grafit C completed 8 728 208

Suvorov section 1-3 M.Blyuhera 12 RosStrojInvest C Jun-20 23 958 568

Source: Knight Frank St Petersburg

The number of projects is gradually reduced in the location of Marshala Blyukhera Ave. A significant amount of areas is currently claimed in former industrial areas near Beloostrovskaya St. and along Bol’shoy Sampsonievsky Ave.

The total amount of areas in the competitive zone is about 1.08 million sqm.

Table 35. Perspective projects

Res. area, District Address Project Developer sq m

Vyborgskij B.Sampsonievskij 66 - Setl City 119 000

Vyborgskij B.Sampsonievskij 68 Novyj Lessner Otdelstroj 120 000

Vyborgskij B.Sampsonievskij 77 Georg Landrin Absolyut Stroj 43 523

Res. area, District Address Project Developer sq m

Primorskij Beloostrovskaya 13 - Confidential 37 151

Primorskij Beloostrovskaya 28 - Gruppa Etalon 31 850

Primorskij Beloostrovskaya 9 - Bazis SPb 31 660

Primorskij Beloostrovskaya/Studencheskij/Krasno - TSDS 240 000 gvardejskij

Vyborgskij Vyborgskaya 4/2a - Strojresurs 5 799

Vyborgskij Vyborgskaya 55 MOST GTC 25 000 Building

Vyborgskij Vyborgskaya 8 - York 16 277

Vyborgskij ZH.Dyuklo 7 - Arsenal-Nedvizhimost' 10 470

Primorskij Zemledel'cheskaya 3 - RosStrojInvest 12 690

Vyborgskij Kantemirovskaya 11 - Klimov 77 417

Kalininskij M.Blyuhera 12 Suvorov Rosstrojinvest 81 000

Kalininskij M.Blyuhera/Laboratornaya - TSvety 68 312

Kalininskij M.Blyuhera/Kushelevskaya - TSDS 59 830

Vyborgskij Novolitovskaya 10-12 LIFE-Lesnaya Pioner 8 499

Vyborgskij Novolitovskaya 16 Oblaka na Setl City 52 200 Lesnoj

Primorskij Studencheskaya 24 Tarmo YUIT 40 360

Source: Knight Frank St Petersburg

The average price in objects-competitors ranges from 90.4 to 157 thousand rubles/sqm. The lowest prices in the competitive zone are represented in residential complex "Landyshi" (Etalon Group developer). The most expensive business class property is "Fusion" near the metro station "Vyborgskaya" (the same developer).

The average price in the competitive zone for comparable properties is 104.3 thousand rubles/sqm. The average price increased by 16% compared with 2016 due to new objects with higher prices in the competitive zone.

Table 36. Average price, average rate of sales of the competition projects

Residential Phase/ Finishing Av. Sold units Parking, mln Commercial Șomplex housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Dom na Blyuhera different 92 029 start of sales not on sale not on sale

Residential Phase/ Finishing Av. Sold units Parking, mln Commercial Șomplex housing price, per quarter rub premises: av. rub per price, rub per sq m sq m

Flamingo section 1-3 without finishing 92 571 14 not on sale 110 000

Flamingo section 4-6 without finishing 95 571 12 not on sale 120 000

G9 full 128 090 25 not on sale not on sale

Kirill i Dar'ya Housing 1 full 107 808 30 0,6 not on sale

Kirill i Dar'ya Housing 2,3 full 97 053 45 0,6 not on sale

Landyshi Housing 1 full 90 380 102 not on sale not on sale

LIFE-Lesnaya Housing 1.1, 1.2 different 116 835 95 not on sale not on sale

LIFE-Lesnaya Housing 2.1 pre-finishing 115 226 45 not on sale 200 000

LIFE-Lesnaya Housing 2.2 pre-finishing 119 099 19 not on sale 200 000

Marshal Housing 1-1 without finishing 103 132 20 not on sale not on sale

Marshal Housing 2-1 without finishing 104 739 20 not on sale 106 321

Pifagor without finishing 103 290 9 not on sale not on sale

Suvorov section 1-3 different 94 146 93 not on sale not on sale

Source: Knight Frank St Petersburg

Maximum sales rates are recorded in residential complex "Landyshi", "LIFE-Lesnaya" (total in all phases) and "Suvorov" and amount to 90-160 apartments per quarter. "Pifagor" is being implemented at the slowest pace, because the developer is less known in the market.

The average rate of sales in the competitive zone is 40 apartments per quarter.

Location 13. Shuvalovskiy, Zapovednaya 51

The competitive zone of the analyzed objects is the northern part of Primorsky district, bounded by Planernaya St., Ilyushina St. and the railway line. As objects of indirect competitive influence, objects under construction close to the metro station "Pionerskaya" – "Primorskij kvartal" and "MASTER" on 19, Serebrystij Bul. – were considered.

There are 12 residential complexes with a total residential area of 698.5 thousand sqm or 17 thousand apartments in the competitive zone. The supply increased by 40% compared with 2016. This is due to sales of new phases in previously implemented large-scale projects and sales of three new projects: "Polis na Komendantskom", "Orlovskiy park" and "Primorskij kvartal".

The map of competition

Source: Knight Frank St Petersburg

72.5% of the area is located in economy class facilities. There is one B-class property on sale on 7, Nizhne- Kamenskaya St., which was commissioned in 2013. The situation in the competitive zone has significantly changed since it was completed – massive residential development of multi-storey facilities began and has increased each year. Thus there are almost no potential consumers of business class apartments in the property, surrounding by multi-storey buildings, at high prices. So the pace of implementation in this object is very low.

About 70% of the apartments are sold with diffirent variants of finishing.

Table 37. Characteristics of the competing projects

Residential Phase/ housing Address Developer Cla Deadline Res. Num Șomplex ss area, sq ber m of flats

CHistoe nebo Housing 4.1 ȏ Komendantskij uch.2 Setl City C Jun-20 113 890 3 254 4.2

CHistoe nebo Housing 6 Komendantskij uch.1 Setl City C Jun-20 74 235 2 121

Graffiti Housing 1.7 SHuvalovskij/Parashyutn Ojkumena C Dec-19 19 153 504 aya

Graffiti Housing 2.1, 2.2 SHuvalovskij/Parashyutn Ojkumena C completed 30 189 624 aya

Graffiti Housing 2.3 SHuvalovskij/Parashyutn Ojkumena C completed 5 303 120 aya

LEGENDA 1 Phase, Komendantskij 54-58 LEGENDA C+ Mar-18 50 643 1 008 Komendantskogo Housing 1-5

LEGENDA 2 Phase Komendantskij 54-58 LEGENDA C+ Dec-19 31 260 504 Komendantskogo

MASTER na Serebristyj 19 Master C+ Mar-19 5 682 102 Serebristom 19 Development

Novoorlovskij Housing 1.6.1 Suzdal'skoe sh. YIT C+ Dec-18 12 648 343 /Novoorlovskaya ul.

Nizhne- Nizhne-Kamenskaya 7 Temp - B complet 13 111 Kamenskaya 7 ed

Orlovskij park ǧ,4ǧ Orlovo-Denisovskij PIK C Sep-21 26 062 456

Polis na 1 Phase (section Gluharskaya Polis Group C Jun-20 25 208 874 Komendantskom 18-20)

Polis na 2 Phase (section Gluharskaya Polis Group C Jun-20 37 600 1 216 Komendantskom 14-17)

Primorskij kvartal Housing Kolomyazhskij 13 Megalit and C+ Jun-19 42 000 697 33,34,35,36 Ohta Group

Primorskij kvartal Housing 43 Kolomyazhskij 13 Megalit and C+ Sep-22 36 359 652 Ohta Group

Ultra City Housing 1,4 Prigorodnyj 4 Severnyj C completed 33 191 663 gorod

Ultra City Housing 2,3 Prigorodnyj 4 Severnyj C Mar-20 34 909 847 gorod

UP-Komendantskij Housing 3.2 Parashyutnaya/ FSK Lider C Jun-19 20 608 483

Residential Phase/ housing Address Developer Cla Deadline Res. Num Șomplex ss area, sq ber m of flats

SHavrova

UP-Komendantskij Housing 3.3 Parashyutnaya/ FSK Lider C Sep-19 20 608 483 SHavrova

YOGA Housing 1 Komendantskij Lider Group C Jun-19 22 764 720 (Kamenka)

YOGA Housing 2 Komendantskij Lider Group C Dec-20 22 203 612 (Kamenka)

YOGA Housing 3 Komendantskij Lider Group C Dec-20 20 841 558 (Kamenka)

Source: Knight Frank St Petersburg

The total residential area of perspective projects in the competitive zone is 3.5 million sqm. There were some changes in the competitive zone in 2017. Part of the territory of residential complex "Novoorlovskij" (YIT developer) was purchased by the company "Ojkumena". A small project in the Kamenka area was announced by "Arsenal-Nedvizhimost’" developer. About half of the area is declared in the project "Chistoe nebo" (Setl City).

Table 38. Perspective projects

Phase/ Res. area, sq Address Project Developer housing m

Beregovaya Novaya Gruppa Prajm 25 489 Skandinaviya

Gluharskaya - Arsenal-Nedvizhimost' 24 290

Gluharskaya Polis na Polis Grupp 3, 4 Phase 134 000 Komendantskom

Kamyshovaya 5 - Severnaya Stolitsa 6 872 Development

Kolomyazhskij 13 Primorskij kvartal 2 Phase Megalit 311 641

Komendantskij (Kamenka) YOGA 2 Phase Lider Grupp 15 339

Komendantskij 54-58 Legenda na Legenda 3 Phase 26 934 Komendantskom

Komendantskij uch.1, uch. 2 CHistoe nebo Setl City 1 717 875

Koroleva 46/4 - Gruppa Etalon 4 558

Optikov/Bogatyrskij - Setl Group

Orlovo-Denisovskij Orlovskij park 2 Phase PIK 40 953

Phase/ Res. area, sq Address Project Developer housing m

Parashyutnaya 52 - Gruppa Etalon 29 287

Planernaya/Gluharskaya/Aviakonstruktorov prodazha proekta Prostor 669 694

Prigorodnyj 4 Ultra City 3 Phase Severnyj gorod 147 856

Suzdal'skoe sh. /Novoorlovskaya ul. Novoorlovskij YUIT 117 960

Suzdal'skoe sh. /Novoorlovskaya ul. - Ojkumena 217 500

SHuvalovskij/Parashyutnaya Graffiti 9 Phase Ojkumena 19 215

Source: Knight Frank St Petersburg

The average price in the competitive zone ranges from 75.3 thousand rubles/sqm in residential complex "YOGA" for an apartment without finishing to 154 thousand rubles/sqm for an apartment with full finishing in a business class house. The developer of "YOGA" project (Lider Group) practices a dumping pricing strategy in its properties. At the same time the developer delays the terms of commissioning (the average delay is 2-3 years).

The average price in the competitive zone for comparable objects is 97.3 thousand rubles/sqm. The average supply price decreased by 5% compared to 2016 due to more affordable proposals.

Table 39. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ housing Finishing Av. price, Sold Parking, Commercial rub per units mln rub premises: av. sq m per price, rub per sq quarter m

CHistoe nebo Housing 4.1 ȏ 4.2 full 92 195 113 not on sale 163 500

CHistoe nebo Housing 6 full 85 852 3 not on sale not on sale

Graffiti Housing 1.7 full 95 900 37 0,7 sold

Graffiti Housing 2.1, 2.2 full 101 568 33 0,6 sold

Graffiti Housing 2.3 full 108 750 12 0,6 147 500

LEGENDA 1 Phase, Housing different 128 878 64 0,8 173 706 Komendantskogo 1-5

LEGENDA 2 Phase different 115 034 19 0,5 139 489 Komendantskogo

MASTER na full 151 033 3 not on sale not on sale Serebristom 19

Nizhne-Kamenskaya 7 full 154 005 2 not on sale, not on sale, rent rent only only

Novoorlovskij Housing 1.6.1 pre-finishing 103 455 33 0,6 114 155

Orlovskij park ǧ,4ǧ full 78 440 87 not on sale not on sale

Residential Șomplex Phase/ housing Finishing Av. price, Sold Parking, Commercial rub per units mln rub premises: av. sq m per price, rub per sq quarter m

Polis na 1 Phase (section pre-finishing 89 988 71 not on sale not on sale Komendantskom 18-20)

Polis na 2 Phase (section pre-finishing 83 938 85 not on sale 164 286 Komendantskom 14-17)

Primorskij kvartal Housing without 108 078 183 not on sale not on sale 33,34,35,36 finishing

Primorskij kvartal Housing 43 without 93 675 73 not on sale 92 000 finishing

Ultra City Housing 1,4 without 109 287 50 0,4 not on sale finishing

Ultra City Housing 2,3 without 94 921 117 0,4 not on sale finishing

UP-Komendantskij Housing 3.2 full 86 862 91 0,6 117 647

UP-Komendantskij Housing 3.3 full 81 229 167 0,6 124 223

YOGA Housing 1 without 80 307 49 not on sale not on sale finishing

YOGA Housing 2 without 77 277 56 not on sale 150 000 finishing

YOGA Housing 3 without 75 353 36 not on sale not on sale finishing

Source: Knight Frank St Petersburg

The average rate of sales for comparable objects in the competitive zone is 66 apartments per quarter.

Location 14. Tsivilizatsiya

The competitive zone represents 2 microdistricts of complex redevelopment of former industrial territories. Firstly, the residential complexes under construction in the locations adjacent to Dal’nevostochnij Av. are considered. Secondly, the redevelopment area in Krasnogvardeisky district near the metro station "Ladozhskaya" was considered.

A residential microdistrict "Rusanovka" is considered as an indirect competitor, where two large residential complexes are being constructed. Furthermore, the residential complexes under construction in Vsevolozhsky district in Kudrovo village are considered.

There are 8 residential complexes under construction in the zone of direct competition, in zones of indirect competition – 11 objects.

The total residential area of sale objects is 938 thousand sqm or 21.6 thousand apartments. The supply volume decreased by 22% compared with 2016 largely due to a reduction of construction in the suburban area, in Kudrovo village.

The map of competition

Source: Knight Frank St Petersburg

The majority of projects in the competitive zone are mass segment residential real estate. The exception is residential complex "Magnifika Residence", which is as part of a large-scale project "Magnifika", but relates to a higher class property than the rest of the complex.

The competition of the project can be estimated as moderate, because there are only three residential complexes under construction in the nearest location. The complex "O'Yunost’", which was presented in the competitive zone earlier, was commissioned and fully implemented.

Table 40. Characteristics of the competing projects

Residential Phase/ Address Developer Cla Deadline Res. Numbe Șomplex housing ss area, sq r of m flats

Dal'nevostochnyj Housing 1ǧ, Dal'nevostochnyj 15 PIK C Jun-20 34 551 759 15 ǧ, 3ǧ

Kollontaj 2 Housing 1-4 Kollontaj 2 Temp C+ Jun-19 40 385 820

LEGENDA Dal'nevostochnyj 12 LEGENDA C+ Dec-19 39 321 627 Dal'nevostochno go

Magnifika D1, D2, A1 Magnitogorskaya 11 Bonava C Mar-20 17 209 376 Lifestyle

Magnifika G1, H1, K1 Magnitogorskaya 11 Bonava B Feb-21 14 031 199 Residence

Polis na Neve Housing 1 Oktyabr'skaya 44 Polis Group C Sep-19 35 266 1 046

Polis na Neve Housing 2 Oktyabr'skaya 44 Polis Group C Dec-19 8 020 300

Renessans Housing 1 Dybenko 8 AAG C+ Sep-19 28 789 572

Renessans Housing 2 Dybenko 8 AAG C+ Sep-19 17 190 267

ZimaLeto Housing 4 EHnergetikov 9 Setl City C Sep-18 27 492 794

Zolotaya dolina section 1-3 EHnergetikov 4/1A Russkie C+ Mar-20 13 744 231 samotsvety

Indirect competitors

7 Stolic.London 15/1 Kudrovo Setl City C Mar-18 17 056 472

Evropejskij park 1 Kudrovo uch.2 Investtorg C Jun-20 32 241 780

Gol'fstrim 1-4 Kudrovo Arsenal- C Mar-19 33 956 685 nedvizhimost'

Kapital Phase 5 Kudrovo Stroitel'nyj trest C Dec-18 37 500 692

Kapital Phase 7 Kudrovo Stroitel'nyj trest C Dec-19 69 105 1 205

Kudrov-Haus uchastok ȶ 2-3b, Prok C Mar-18 10 216 261 kvartal ȶ 2

KudroVO! 1 Phase Kudrovo, Prazhskaya Patriot-Neva C Sep-18 20 254 442

KudroVO! 2.1 Phase Kudrovo, Prazhskaya Patriot-Neva C Dec-19 13 482 299

Residential Phase/ Address Developer Cla Deadline Res. Numbe Șomplex housing ss area, sq r of m flats

(section 1-5)

KudroVO! 2.2 Phase Kudrovo, Prazhskaya Patriot-Neva C Dec-19 17 885 388 (section 6- 12)

Lastochkino Housing 6 Oktyabr'skaya 118 Etalon Group C completed 21 904 405 gnezdo

Novyj Okkervil' 3 Phase Kudrovo, Otdelstroj C completed 48 010 1 120 Leningradskaya

Novyj Okkervil' 4 Phase Kudrovo, Otdelstroj C Dec-18 75 590 1 592 Leningradskaya

Novyj Okkervil' 5 Phase Kudrovo, Otdelstroj C Dec-18 43 922 962 Leningradskaya

Novyj Okkervil' 6 Phase Kudrovo, Otdelstroj C Dec-19 22 521 508 Leningradskaya

ParkLend Kudrovo, Polis Group C Sep-21 71 371 2 453 Central'naya/Prazhskaya

Prinevskij Housing 4 Oktyabr'skaya 122 TSDS C Dec-19 33 273 835

Prinevskij Housing 6 Oktyabr'skaya 122 TSDS C Dec-18 41 644 1 210

Vesna-3 Housing 2 Kudrovo TSDS C Dec-18 52 000 1 330

Source: Knight Frank St Petersburg

The total area of perspective objects in the competitive zone is 1.2 million sqm. The largest-scale declared complexes are BFA-Development project on 54, Oktyabr’skaya embankment and Setl City project on 38, Oktyabrskaya embankment.

Table 41. Perspective projects

Non- Res. area, District Address Project District residential sq m status

Nevskij Dal'nevostochnyj 15 Dal'nevostochnyj PIK - 34 551 15

Nevskij Dybenko 8 Renessans AAG - 32 331

Nevskij Zol'naya 17 Zol'naya 17 Normann - 17 600

Nevskij Krylenko 1A - Bazis - 23 059

Krasnogvardejskij Magnitogorskaya 11 Magnifika Bonava - 42 804

Non- Res. area, District Address Project District residential sq m status

Krasnogvardejskij Magnitogorskaya Ohta Moll SRV + 77 900 11/4

Krasnogvardejskij Magnitogorskaya 51 - Aksis - 28 000

Nevskij Oktyabr'skaya 122 Prinevskij TSDS - 190 082

Krasnogvardejskij Oktyabr'skaya 38 - Setl City - 300 000

Nevskij Oktyabr'skaya 54 - BFA-Development - 400 000

Nevskij Oktyabr'skaya 86/2 - Proektservis - 11 246

Krasnogvardejskij Oktyabr'skaya 98/3 Veren Next Veren Group - 11 022 Oktyabr'skaya

Krasnogvardejskij Utkin 13 Malaya Ohta Renovatsiya SPb - 19 432

Source: Knight Frank St Petersburg

The average price in the objects of direct competition ranges from 91.8 thousand rubles/sqm in the object of "PIK" developer to 143.7 thousand rubles/sqm in the business class property. The average price in competing projects is 113.6 thousand rubles/sqm. In objects of indirect competition this indicator is lower by 32% and amounts to 77.2 thousand rubles/sqm.

Table 42. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ Finishing Av. price, Sold Parking, mln Commercial housing rub per sq units rub premises: av. m per price, rub per sq quarte m r

Magnifika Lifestyle D1, D2, A1 pre-finishing 127 334 55 1,4 not on sale

Magnifika Residence G1, H1, K1 pre-finishing 143 698 2 1,1 not on sale

ZimaLeto Housing 4 full 127 186 79 no in the not on sale project

Zolotaya dolina section 1-3 without 114 683 5 not on sale not on sale finishing

Dal'nevostochnyj 15 Housing 1ǧ, full 91 868 18 not on sale sold ǧ, 3ǧ

Kollontaj 2 Housing 1-4 full 109 941 41 no in the not on sale, rent project only

LEGENDA different 131 680 50 0,9 180 000 Dal'nevostochnogo

Polis na Neve Housing 1 full 103 911 14 not on sale not on sale

Residential Șomplex Phase/ Finishing Av. price, Sold Parking, mln Commercial housing rub per sq units rub premises: av. m per price, rub per sq quarte m r

Polis na Neve Housing 2 without 93 035 0 not on sale not on sale finishing

Renessans Housing 1 pre-finishing 103 671 25 not on sale 104 448

Renessans Housing 2 pre-finishing 102 267 12 not on sale 95 744

Indirect competitors

7 Stolic.London 15/1 full 89 006 63 not on sale not on sale

Evropejskij park 1 full 66 749 10 0,5 not on sale

Gol'fstrim 1-4 full 83 820 50 0,4 400 000

Kapital Phase 5 pre-finishing 80 625 18 0,9 115 335

Kapital Phase 7 pre-finishing 77 893 7 0,9 104 995

Kudrov-Haus without 73 333 9 not on sale not on sale finishing

KudroVO! 1 Phase pre-finishing 69 128 31 not on sale 96 470

KudroVO! 2.1 Phase pre-finishing 67 113 12 not on sale 96 470 (section 1-5)

KudroVO! 2.2 Phase pre-finishing 65 910 5 not on sale 96 470 (section 6-12)

Lastochkino gnezdo Housing 6 different 70 618 21 0,6 94 490

Novyj Okkervil' 3 Phase pre-finishing 91 953 73 not on sale not on sale

Novyj Okkervil' 4 Phase pre-finishing 89 572 87 not on sale not on sale

Novyj Okkervil' 5 Phase without 85 225 80 not on sale not on sale finishing

Novyj Okkervil' 6 Phase without 81 011 48 not on sale not on sale finishing

ParkLend pre-finishing 81 258 262 not on sale not on sale

Prinevskij Housing 4 full 66 006 135 not on sale not on sale

Prinevskij Housing 6 without 73 678 147 not on sale not on sale finishing

Vesna-3 Housing 2 without 76 315 159 0,7 132 300 finishing

Source: Knight Frank St Petersburg

High rates of sales in the city area are fixed in the objects of well-known developers such as: "Setl City" and "Bonava". In the suburban areas the sales leader was "TSDS", also high rates were recorded in the objects of "Setl City" and "Arsenal-Nedvizhimost’".

The developer’s reputation plays an important role for consumer. In mass segment it is based on the number of constructed and commissioned objects within the stated terms.

The average rate of sales for direct competitors is 27 apartments per quarter. In the zone of indirect competition this indicator is about 2.5 times higher – 67 apartments per quarter.

Location 15. Novaya Okhta, Tsvetnoi Gorod, Ruchyi

The competitive zone is a new area of complex development of the territories of the northern part of Vsevolozhsky district, where residential development began with the development of the former agricultural lands of CJSC "Ruch’i". It includes properties under construction in Murino village, Novoe Devyatkino, Lavriki.

25 residential complexes meet these requirements. The total residential area of sale objects in this location is 1.35 million sqm (34.1 thousand apartments), which is 30% of objects under construction in suburban areas. The supply volume decreased by 25% compared with 2016.

There are no commissioned objects in the competitive zone. 25% of the areas of direct competition are planned for commissioning by the end of 2018, another 45% – until the end of 2019.

83% of the projects in the competitive zone are to be commissioned in the period from 2017 to 2018. According to regular monitoring of commissioning dynamics it can be assumed that most of objects will be commissioned later than the stated deadlines (after 2014 the average delay and postponement deadlines are 6 months and 1 year).

All projects in the location are classified as economy class residential properties and primarily oriented to mass demand. The average area of apartments in the competitive zone is 37.5 sqm. For comparison, in the city the average area is 46.3 sqm.

The map of competition

Source: Knight Frank St Petersburg

The competitive zone includes projects of direct and indirect competitive influence. The direct competitors include 43% of apartments – 557 thousand sqm or 14.8 thousand apartments.

Table 43. Characteristics of the competing projects

Residential Șomplex Phase/ Address Developer Class Deadline Res. area, Number housing sq m of flats

Enfild 1 Bugry Arsenal-nedvizhimost' C Sep-19 19 990 503

Enfild 1 Phase Bugry Arsenal-nedvizhimost' C Dec-18 21 890 505

Galaktika Mir Novoe Devyatkino Glavstrojkompleks C Jun-19 18 690 526

GreenLandiya Housing 2.6 Murino Setl City C Jun-18 22 996 770

GreenLandiya Housing 2.7 Murino Setl City C Sep-18 10 170 262

Residential Șomplex Phase/ Address Developer Class Deadline Res. area, Number housing sq m of flats

GreenLandiya Housing 2.8 Murino Setl City C Sep-19 53 000 1 564

Kraski leta 12 Murino Polis Group C Mar-19 65 179 2 263

Kraski leta 8 Murino Polis grupp C Jun-18 8 216 283

Kraski leta Housing 13 Murino Polis grupp C Jun-20 11 706 406

Murino 2019 3,4 Bugry Samolyot LO C Dec-19 70 060 2 004

Murinskij Posad 2 Murino TSDS C Dec-19 24 125 641

Murinskij Posad 3 Murino TSDS C Sep-20 50 956 1 372

Solnechnyj 11 Murino Arsenal-Nedvizhimost' C Mar-20 27 179 588

Solnechnyj 14 Murino Arsenal-Nedvizhimost' C Sep-18 3 716 62

Solnechnyj 9 Murino Arsenal-Nedvizhimost' C Mar-20 23 389 556

UP-kvartal Svetlanovskij 1 Phase Bugry FSK Lider C Dec-18 17 045 487

UP-kvartal Svetlanovskij 2 Phase Bugry FSK Lider C Jun-18 56 412 879

YouPiter 16 Murino Arsenal-nedvizhimost' C Sep-20 19 048 402

YouPiter 17,19 Murino Arsenal-nedvizhimost' C Dec-20 21 739 474

YouPiter 18 Murino Arsenal-nedvizhimost' C Sep-20 11 565 298

Indirect competitors

Dom na Ozernoj Novoe Devyatkino Russkaya Skazka C Sep-18 44 728 1 210

Forvard 1 Murino Mavis C Dec-18 37 146 970

Gamma 1 Novoe Devyatkino PromServis C Jun-19 65 805 958

Gamma 2 Novoe Devyatkino PromServis C Jun-19 30 155 439

Leningradskaya perspektiva Murino LenSpetsStroj C Dec-19 69 000 1 349

Leningradskaya perspektiva Phase 1,2,3 Murino LenSpetsStroj C Sep-18 51 233 1 146

Materik Phase 1 Murino Petrostroj C Dec-18 14 398 549

Materik Phase 2 Murino Petrostroj C Dec-18 15 876 618

Materik Phase 3 Murino Petrostroj C Jun-19 13 392 486

Materik Phase 4 Murino Petrostroj C Jun-20 10 161 435

Materik Phase 5 Murino Petrostroj C Dec-21 14 835 503

Severnaya palitra 1 Murino MonArh-Development C Mar-18 26 290 308

Sokol Murino StrojTekhInvest25 C Dec-18 21 361 392

Staraya krepost' Phase 2 Murino RosStrojInvest C Mar-18 22 022 552

Residential Șomplex Phase/ Address Developer Class Deadline Res. area, Number housing sq m of flats

Territoriya 1,2 Murino Lider Group C Jun-19 23 869 642

Territoriya 3,4,5 Murino Lider Grupp C Jun-19 38 796 1 129

Territoriya 6 Murino Lider Group C Jun-19 25 935 708

Tri kita 3 Phase Murino Lider Group C Dec-19 68 649 1 816

Tridevyatkino tsarstvo Housing 11 Murino Unisto Petrostal' C Dec-18 24 599 503

Tridevyatkino tsarstvo Housing 9-10 Murino Unisto Petrostal' C Jun-18 42 079 1 008

TSveta Radugi 1 Murino Mavis C Dec-18 16 191 435

TSveta Radugi 3 Murino Mavis C Sep-19 26 312 730

Viktoriya Housing 3(11) Murino Mavis C Jun-18 17 234 456

Viktoriya Housing 6 Murino Mavis C Jun-19 5 982 120

Viktoriya Housing 8 Murino Mavis C Jun-20 5 559 137

VillaHills Bugry VillaDevelopment C Mar-18 4 792 177

VITAMIN Murino Lider Group C Dec-18 42 766 1 135

YUventa Housing 1 Bugry Konnolahtinskij 55 C Mar-20 14 357 391

Source: Knight Frank St Petersburg

The analysis of perspective projects allows to define the increase of competition in reviewed location. Along with this, building volumes in the area of Murino village, Devyatkino and Bugry will decline. The developers- competitors offer small apartments in the real estate market, so it could be a shortage of comfortable and affordable apartments in the analyzed area.

The total area of the nearest prospective projects in the competitive zone is 3.27 million sqm up to 2025. Furthermore, several more plots are being sold for residential development and a few are transfering from agricultural land to residential (the area of possible improvements is about 2 million sqm of housing).

Table 44. Perspective projects

Res. area, sq Address Project Phase/ housing Developer m

Lavriki - Lider Group 8 000

Murinskaya doroga - Normann 21 900

Murino - TSDS 177 000

Ruch'i GreenLandiya Setl City 288 654

SAOZT Ruch'i YOUPiter Arsenal-Nedvizhimost' 74 168

Lavriki Azimut Samolet LO 740 000

Lavriki Aksioma Petrostroy 59 000

Res. area, sq Address Project Phase/ housing Developer m

Novoe Devyatkino Galaktika Glavstroykompleks 265 793

Lesnaya Gamma 3 Phase PromServis 20 357

Murino Kraski Leta 5 Phase Polis grupp 38 188

Murino Murinskij posad TSDS 371 383

Novoe Devyatkino Novoe Devyatkino Dal'piterstroy 144 000

Garazhnyj proezd Novye gorizonty TSDS 417 000

Murino Severnaya palitra MonArh-Development 46 439

Murino Tri kita Lider grupp 168 000

Novoe Devyatkino Udacha ISK Vita 24 605

Murino Forvard Mavis 7 915 zemli SAOZT "Ruch'i" TSveta Radugi 1 Phase Mavis 72 423

Bugry Enfild Arsenal-Nedvizhimost' 306 000

Bugry YUventa Konnolahtinskiy 55 21 996

Source: Knight Frank St Petersburg

The average price in analogues ranges from 58.5 thousand rubles/sqm without finishing to 88 thousand rubles/sqm with complete finishing. The average price per sqm among main competitors is 74.7 thousand rubles. For comparison, in objects of indirect competition, which are far from the nearest metro station, this indicator is lower by 17% and amounts to 62.2 thousand rubles/sqm.

Table 45. Average price, average rate of sales of the competition projects

Residential Șomplex Phase/ Finishing Av. price, Sold units Parking, mln Commercial housing rub per sq per quarter rub premises: av. price, m rub per sq m

Enfild 1 full 71 754 64 0,4 not on sale

Enfild 1 Phase full 71 293 63 not on sale not on sale

Galaktika Mir without finishing 61 461 60 1,0 not on sale

GreenLandiya Housing 2.6 full 88 077 61 not on sale not on sale

GreenLandiya Housing 2.7 full 79 168 32 free parking 172 075

GreenLandiya Housing 2.8 full 78 381 134 not on sale not on sale

Kraski leta 12 without finishing 72 733 94 not on sale not on sale

Kraski leta 8 without finishing 80 048 22 not on sale not on sale

Kraski leta Housing 13 without finishing 66 657 89 not on sale not on sale

Residential Șomplex Phase/ Finishing Av. price, Sold units Parking, mln Commercial housing rub per sq per quarter rub premises: av. price, m rub per sq m

Murino 2019 3,4 without finishing 63 851 63 not on sale not on sale

Murinskij Posad 2 without finishing 64 548 196 not on sale not on sale

Murinskij Posad 3 without finishing 58 581 141 not on sale not on sale

Solnechnyj 11 full 82 748 41 0,4 not on sale

Solnechnyj 14 full 79 326 6 0,4 not on sale

Solnechnyj 9 full 84 212 58 0,4 not on sale

UP-kvartal Svetlanovskij 1 Phase full 75 080 79 not on sale not on sale

UP-kvartal Svetlanovskij 2 Phase without finishing 76 847 70 not on sale not on sale

YouPiter 16 full 78 731 115 not on sale not on sale

YouPiter 17,19 full 78 525 54 0,4 not on sale

YouPiter 18 full 81 418 39 0,4 not on sale

Indirect competitors

Dom na Ozernoj full 65 388 22 not on sale not on sale

Forvard 1 without finishing 66 889 133 not on sale not on sale, rent only

Gamma 1 full 45 038 40 not on sale not on sale

Gamma 2 full 38 819 24 not on sale not on sale

Leningradskaya perspektiva different 55 731 17 not on sale 90 000

Leningradskaya perspektiva Phase 1,2,3 different 64 354 22 not on sale 90 000

Materik Phase 1 without finishing 57 850 50 0,4 99 800

Materik Phase 2 without finishing 57 850 59 0,4 99 800

Materik Phase 3 without finishing 56 070 50 0,4 97 000

Materik Phase 4 without finishing 56 070 83 0,4 93 000

Materik Phase 5 without finishing 52 576 55 not on sale not on sale

Severnaya palitra 1 without finishing 66 223 6 not on sale not on sale

Sokol without finishing 69 532 11 free parking not on sale

Staraya krepost' Phase 2 pre-finishing 67 835 38 0,7 not on sale

Territoriya 1,2 without finishing 62 128 95 not on sale not on sale

Territoriya 3,4,5 without finishing 59 034 147 not on sale not on sale

Territoriya 6 without finishing 59 516 36 not on sale not on sale

Residential Șomplex Phase/ Finishing Av. price, Sold units Parking, mln Commercial housing rub per sq per quarter rub premises: av. price, m rub per sq m

Tri kita 3 Phase different 62 049 89 not on sale not on sale

Tridevyatkino tsarstvo Housing 11 full 66 923 20 not on sale not on sale, rent only

Tridevyatkino tsarstvo Housing 9-10 full 67 309 37 not on sale not on sale, rent only

TSveta Radugi 1 without finishing 60 612 60 not on sale not on sale, rent only

TSveta Radugi 3 without finishing 58 000 64 not on sale not on sale

Viktoriya Housing 3(11) without finishing 72 320 82 not on sale not on sale

Viktoriya Housing 6 without finishing 67 647 21 not on sale not on sale, rent only

Viktoriya Housing 8 without finishing 72 074 46 not on sale not on sale

VillaHills without finishing 95 897 4 not on sale not on sale

VITAMIN without finishing 60 314 59 not on sale not on sale

YUventa Housing 1 without finishing 57 663 50 not on sale not on sale

Source: Knight Frank St Petersburg

The average rate of sales for the objects of the main competitive group is 74 apartments per quarter, in objects of indirect competition – 50 apartments per quarter.

High rates of sales (more than 200 apartments per quarter in total) are recorded in properties of major developers such as: "Setl City", "Polis Group", "Lider Group", "Mavis", and "TSDS". The developer's reputation plays an important role for consumer. In mass segment the reputation is based on the number of constructed and commissioned objects within the stated terms. The priority for consumers especially under unstable economic situation is a guarantee of commissioning terms.

About 10.1 thousand apartments (373 million sqm) were sold in the location excluding sales in the Projects. Sales decreased by 28%, which is due to the market shift trends in demand towards urban properties.

Location 16. Rzhevka

The project's competitive area is mostly concentrated in the area of complex development of Yanino village territory. There is one more project in Krasnogvardeysky district.

The map of competition

Source: Knight Frank St Petersburg

9 residential complexes correspond to these requirements. The total residential area of sale objects is 308.5 thousand sqm or 7.8 thousand apartments. The supply increased slightly compared with 2016 – by 4%, due to sales of new phases in "Jaanila country". Developers are slow to sale new phases of the rest of the projects due to limited transport facilities in the area. All projects are C-class residential properties and oriented to mass consumers. 82% of the areas of the competitive zone should be commissioned in 2018 or already commissioned. And most of the projects postponed their commissioning terms, previously planned for 2017.

Table 46. Characteristics of the competing projects

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats

Brusnichnyj 3 YAnino-1 NSK C Jun-18 2 563 82 SHossejnaya 37A

Jaanila country Housing YAnino-1 Lenstrojtrest C Mar-18 23 623 519 4,5,6,7

Novoe YAnino Housing Ǩ YAnino-1 TSDS C Dec-18 32 835 947

Novoe YAnino Housing ǩ YAnino-1 TSDS C Dec-18 22 635 640

Rzhevskaya 1,2 YAnino-1 Strojresurs C Dec-18 1 080 36

Residential Phase/ Address Developer Clas Deadline Res. Numbe Șomplex housing s area, sq r of m flats usad'ba

YAninskij kaskad- YAnino-1 Stroitel'noe C Jun-18 8 703 176 4 Kol'tsevaya uch 12 upravlenie

YAninskij kaskad- YAnino-1 7 liniya, Stroitel'noe C Dec-19 11 793 263 5 uchastok 1 upravlenie

YArkij Housing ǧ, Ǩ YAnino-1 Normann C Dec-18 25 968 825

YArkij Housing ǩ, Ǫ YAnino-1 Normann C Mar-19 42 341 1 379

YAsno.YAnino 2.1,2.2 YAnino-1 KVS C Dec-18 22 018 542

YAsno.YAnino 7.1-7.7 YAnino-1 KVS C Mar-18 78 175 1 652

ZemlYAnino Phase 1 YAnino-1 Patriot-Neva C Sep-18 18 284 369

ZemlYAnino Phase 2 YAnino-1 Patriot-Neva C Dec-18 14 010 284

ZHernovka Housing 17 2 ZHernovskaya 2/4 DM C complete 4 506 80 d

Source: Knight Frank St Petersburg

The forecast for the development of promising areas in the competitive zone remains at the level of 1.8 million sqm. Redevelopment projects of industrial areas in Krasnogvardeisky district on Kapsyul’noye highway ana Communa St. were in active stage of development in 2017.

Table 47. Perspective projects

Phase/ Res. area, sq District Address Project Developer housing m

Krasnogvardejskij 2 ZHernovskaya 48 - Project in sale 15 800

Krasnogvardejskij Kommuny 67 - Teorema 546 895

Vsevolozhskij YAnino-1 Jaanila Lenstrojtrest 3,4 Phase 182 613 country

Vsevolozhskij YAnino-1 ZemlYAnino 3 Phase Patriot Neva 111 700

Vsevolozhskij YAnino-1 YAnino park 2 Phase SU-155 28 543

Krasnogvardejskij Kapsyul'noe 44 - NPP Krasnoznamenets 520 000

Krasnogvardejskij Ryabovskoe/Belomorskaya Stereos Renovatsiya SPb 146 444

Krasnogvardejskij Himikov, 28 - Teorema 202 000

Phase/ Res. area, sq District Address Project Developer housing m

Vsevolozhskij YAnino-1 YArkij 3-5 Phase Normann 47 691

Vsevolozhskij YAnino-1 YAnino park 3 Phase SU-155 15 393

Source: Knight Frank St Petersburg

Competitors are comparable to the analyzed project by their location and transport access. All the properties are in the zone of new residential development with limited social and commercial infrastructure. Complex transport access to new microdistricts plays an important role for consumer. This factor should be taken into account while commissioning the project due to difficult transport access to Koralevo village and traffic jams on Ryabovskoe highway. The construction of tram lines to a new microdistrict is able to have a positive effect on demand.

More than half of all apartments in the competitive zone are offered without finishing. Only "Jaanila country" is offered with full finishing, in the remaining complexes the apartment are offered with pre- finishing.

The average price in analogues ranges from 45.7 thousand rubles/sqm without finishing to 67 thousand rubles/sqm with pre-finishing. The maximum prices are shown in residential complex "Zhernovka" in urban area. The average price per sqm in competing projects is 59.8 thousand rubles. There is a correlation between price and commissioning terms in several phases, which ranges from 4 to 6% in different objects.

Table 48. Average price, average rate of sales of the competition projects

Residential Phase/ Finishing Av. price, Sold units Parking, mln Commercial Șomplex housing rub per sq per rub premises: av. m quarter price, rub per sq m

Brusnichnyj 3 without finishing 66 805 4 free parking 110 000

Jaanila country Housing full 60 687 38 not on sale not on sale 4,5,6,7

Novoe YAnino Housing Ǩ without finishing 61 959 183 not on sale not on sale

Novoe YAnino Housing ǩ without finishing 63 597 113 not on sale not on sale

Rzhevskaya usad'ba 1,2 without finishing 45 665 1 free parking no in the project

YAninskij kaskad-4 without finishing 52 249 8 no in the project not on sale

YAninskij kaskad-5 without finishing 50 026 10 no in the project not on sale

YArkij Housing ǧ, Ǩ without finishing 55 380 60 free parking 87 400

YArkij Housing ǩ, Ǫ without finishing 50 550 42 free parking not on sale

YAsno.YAnino 2.1,2.2 pre-finishing 63 899 74 0,5 86 000

YAsno.YAnino 7.1-7.7 pre-finishing 67 339 127 0,4 90 800

ZemlYAnino Phase 1 pre-finishing 54 999 8 free parking no in the project

Residential Phase/ Finishing Av. price, Sold units Parking, mln Commercial Șomplex housing rub per sq per rub premises: av. m quarter price, rub per sq m

ZemlYAnino Phase 2 pre-finishing 51 826 22 not on sale not on sale

ZHernovka Housing 17 without finishing 92 556 4 0,9 no in the project

Source: Knight Frank St Petersburg

High rates of sales are fixed in the facilities of major developers such as: "TSDS", "Normann" and "KBC", where the average rate of sales reaches 100-300 apartments per quarter.

The number of sold apartments increased from 2.5 thousand to 3.16 thousand in 2017, while the total area sold apartments decreased from 98.6 thousand sqm to 94.6 thousand sqm, which attests to a shift in demand for small-sized apartments (mainly studios).

The average rate of sales for 1st phase of objects in the competitive zone is about 50 apartments per quarter.

Residential market overview of Moscow

According to the official data of Mosgorstat, in 2017 for the period from January to November, 1.87 million square meters of housing were commissioned. For comparison for the same period in 2016, this indicator was slightly more than 2.28 million square meters. Thus, the current figures are almost 18% lower than the same period last year. In the ranking of constituent entities of the Russian Federation in terms of housing commissioning, Moscow ranks fifth, behind St. Petersburg, Krasnodar Krai, Leningrad and Moscow regions.

Official statistics Rosstat does not consider apartment complexes, as legally they have non-residential status. At the same time, the situation in the market of new buildings in Moscow is such that a significant proportion of the apartments are occupied, which are de facto used as permanent residence and are housing, but legally are non-residential premises or temporary accommodation.

Chart 24. Dynamics of the volume of housing construction in Moscow

Source: Knight Frank, 2018

Business Class

Supply

Regular release of new projects, as well as new buildings within the framework of the complexes being implemented, ensured an increase in the volume of the exposition in the housing market of business and premium class. Over the past year (relative to the fourth quarter of 2016), the volume of exhibited apartments grew by 18% and as of the end of December 2017 amounted to 16 483 lots with a total area of more than 1.3 million square meters. During 2017, apartments were offered to the market in 19 new residential complexes of business and premium class with a total project area of more than 1.1 million square meters with the terms of entry in 2018-2021. Most of the new projects belong to the business class and are different in scale complexes, including those implemented within the framework of development of former industrial territories. The premium segment in 2017 has replenished with 3 new residential projects.

During 2017, with the introduction of new projects and new buildings into the market in the framework of residential complexes that have already been implemented, the structure of the proposal for administrative districts has undergone significant changes. At the same time, it is important to note that in most districts an increase in the amount of exhibited apartments was recorded. So, for example, in the Northern Administrative Okrug, North-Eastern Administrative Okrug and Southern Administrative Okrug, the number of apartments put up for sale has almost doubled in a year. In the Northern Administrative Okrug, which is the leader of the rating following the results of 2017, 16 residential complexes of business and premium class are being implemented. The increase in the volume of the exposition is connected with the replenishment of the offer with new projects, as well as with new buildings within the framework of realizable housing estates. A similar situation is noted in the North-Eastern Administrative Okrug, at the end of the year it took the third place in the rating of administrative districts due to the increase in the share of the apartments put up for sale at 7 pp. Still occupies one of the last places in the rating of administrative districts due to the increase in the share of the apartments offered for sale by 7 percentage points.

Despite a twofold increase in the amount of exposition in the Eastern Administrative Okrug, the district still occupies one of the last places in the rating.

A significant decrease in the volume of the exposition of apartments was recorded in the Central Administrative Okrug, South Administrative Okrug and South-Eastern Administrative Okrug. And if in CAO during 2017 proposals appeared in new projects and subsequent stages of realizable housing estates, then in SAO and SEAO new projects did not come out, which is largely due to the specifics of the southern areas of the city where residential projects are mainly implemented in more accessible segments market.

Chart 25. Division of supply by the administrative okrugs of Moscow

Source: BEST-Novostroy, 2018

In the structure of the supply for the stages of construction readiness, a high proportion of the apartments exhibited on the market was noted in the houses put into operation. During 2017, this share was 16-19%

against the background of an increase in the total supply, while a year earlier it was 11-14%, which may indicate the prerequisites for a possible overstocking of the market in the segments under consideration. Despite the regularity of entering new objects on the market, the share of supply at the initial stages of construction is gradually decreasing. As of the end of December 2017, its total figure was 32% of the total volume of the exposition.

Chart 26. Division of supply by construction stage

*Outer circle – by number of apartments being sold, %; inner circle – by number of residential buildings under realization Source: BEST-Novostroy, 2018

In the structure of the supply for the types of apartments in the new business-class buildings, there were no significant changes during 2017. The main volume is 1-room, 2-bedroom and 3-bedroom apartments (91% of the total number of lots in the exposition). At the same time, against the background of the growth in the number of apartments for sale, the largest increase was recorded in the segments of 1-room and 3-room lots. On the contrary, the number of studios that occupy 1% of the total volume of the business class exposition has decreased by 13% per year. It should also be noted that in most new projects that entered the market during 2017, the average area of apartments is higher than in the previous year and is 70 square meters. At the same time, new business-class projects are distinguished by a wide range of planning solutions - from small apartments to penthouses, apartments of classical format and European type layout (with a combined kitchen and living room).

Thus, according to the results of 2017, it can be stated that competition in the market of new business class buildings continues to grow. Regular release of new projects and new buildings within existing solutions. At the same time, an increase in the share of expositions in houses/buildings at the final stages of construction may indicate a possible start of a market overstocking in the segment of new business class buildings.

Demand

End-of-year 2017, the level of consumer activity in the primary market of business class housing exceeded the figures of the previous year. As in the previous year, a high level of demand was maintained thanks to a moderate pricing policy in the implementation of residential areas, as well as due to the attractive purchasing conditions of apartments throughout 2017.

In addition, a significant impact on the level of purchasing activity in the primary housing market in 2017 had a decline in mortgage rates. If in 2016 the share of mortgage deals in new business class buildings was about 34% of the total, then in 2017 it increased to 43%.

In the structure of demand for apartment types during 2017 there was a slight increase in purchasing activity in relation to multi-room apartments (3-room and more) - by 1-2 pp during the year. At the same time, the main demand in new business class buildings is concentrated in relation to 1-room and 2-room apartments. (total not less than 65-70% of the total number of purchases during 2017).

Chart 27. Demand for premium- and business-class apartments, depending on the number of rooms

Inner circle – business class; outer circle – premium class

Source: BEST-Novostroy, 2018

Chart 28. Demand for premium and business class apartments, depending on payment method

Mortgage

Inner circle – business class; outer circle – premium class

Source: BEST-Novostroy, 2018

Commercial terms

During 2017, the dynamics of supply prices in the primary real estate market of business class real estate was multidirectional. In particular, in business-class new buildings, the average price of the offer has been reduced to 228,610 rubles. for the square. m (-3% relative to Q4 2016). The negative dynamics of prices in many respects is caused by the market of offers of apartments in projects that have entered the market in 2017 and new buildings of already realized residential complexes at the initial stages of construction readiness. In addition, with the increase in the proportion of exhibited apartments in the new buildings that were put into operation, the volume exposures of multi-room apartments (3-room, 4-room and more), as a rule, with a lower unit price compared to other types of apartments.

Table 14. New business-class projects released the residential property market in 2017

Number Date of Development project Class Type Location Developer Start of sales of lots commissioning Malaya Bronnaya 15 Elite Flats CAO / Presnensky «LidEHstejt» 21 4Q 2017 3Q 2020 Sberbank Kapital/ TSarev sad Elite Apartments CAO / Yakimanka Mirland 68 4Q 2017 1Q 2018 Development Bol'shaya Dmitrovka IX Elite Apartments CAO / Tverskoy INGEOKOM 94 4Q 2017 4Q 2020 Bunin Elite Flats CAO / Khamovniki Vesper 29 2Q 2017 4Q 2017 ORDYNKA Elite Flats/Apartments CAO/Zamoskvorechye INSIGMA/VTB 58/27 2/4Q 2017 4Q 2019 Barkli Gallery Elite Flats CAO / Yakimanka Barkli 46 1Q 2017 4Q 2018 Na Bol'shom Elite Flats CAO / Presnenky «Investstrojkom» 16 1Q 2017 4Q 2018 Kozihinskom Sofijskij Elite Apartments CAO / Yakimanka VTB 196 1Q 2017 4Q 2018 Kutuzovskij 12 Premium Flats WAO / Dorogomilovo Capital Group 123 4Q 2017 2Q 2019 Life-Kutuzovskij Business Flats WAO / Mojaysky «Pioner» 286 4Q 2017 4Q 2019 NWAO / Khoroshevo- Serebryanyj park Business Flats INGRAD 324 4Q 2017 1Q 2021 Mnevniki Moj adres na Tishinskom Business Flats CAO / Presnenky KPUGS 35 4Q 2017 4Q 2016 Hutton TSvet 32 Premium Apartments CAO / Meschansky Development/MR 47 4Q 2017 2Q 2019 Group Olivkovyj Dom Premium Flats NAO/Begovoy «Donstroj» 64 3Q 2017 4Q 2019 GM Tverskaya Premium Apartments NAO/Begovoy PSN 183 3Q 2017 2Q 2020 Roza Rossa Boutique Premium Apartments CAO / Khamovniki KR Properties 120 3Q 2017 3Q 2020 Hotel & Apartments Vavilov DOM Business Flats ˓WAO/Akademichesky «TSentr-Invest» 792 3Q 2017 3Q 2019 Lider na Presne Business Flats CAO / Presnensky «Lider Invest» 79 3Q 2017 3Q 2019 Novocheremushkinskaya Business Flats ˓WAO/Akademichesky INGRAD 529 3Q 2017 4Q 2019 17 Serebryanyj fontan Business Flats NEAO/Alekseevsky «EHtalon-Invest» 386 3Q 2017 1Q 2020 Life-Botanicheskij sad-2 Business Flats NEAO / Sviblovo «Pioner» Ȕȋ 3Q 2017 2Q 2019 Vremya Business Flats EAO/Preobrajenskoye «BEHST Konsalting» 273 3Q 2017 1Q 2020 Pravda Business Apartments NAO / Begovoy PSN 439 3Q 2017 1Q 2020 A-Residence Premium Apartments CAO/Zamoskvorechye 01 Properties 142 2Q 2017 1Q 2019 - 2Q 2019 Kontsept House Business Flats WAO / Mojaysky «Kontsept Invest» 101 2Q 2017 3Q 2017 Rezidentsii arhitektorov Business Flats CAO / Basmanny AFI Development 187 2Q 2017 2Q 2019

Number Date of Development project Class Type Location Developer Start of sales of lots commissioning Konsul-Dom. Lider na Business Flats WAO / Troparevo-Nikulino «Lider Invest» 56 2Q 2017 3Q 2018 Leninskom Zapadnyj port. Kvartaly «SHater Business Flats WAO / Filyovsky Park 583 2Q 2017 1Q 2020 na naberezhnoj Development» Vasnetsov Dom. Lider na Business Flats NAO / Savyolovsky «Lider Invest» 57 2Q 2017 4Q 2018 Maslovke Leninskij 38 Business Apartments ˓WAO / Gagarinsky «Me dzhi kom» 213 2Q 2017 3Q 2018 Rezidentsii «Monolit Business Apartments CAO/Zamoskvorechye 183 2Q 2017 1Q 2018 Zamoskvorech'e KapitalStroj» Mostman Premium Flats CAO/Tagansky «Invest Proekt» 48 1Q 2017 4Q 2018 Rezidentsii Business Flats NEAO / Sviblovo AFI Development 759 1Q 2017 4Q 2018 kinematografistov NEAO / Severnoye SHirokaya Green park Business Flats «PATEK GRUPP» 386 1Q 2017 1Q 2017 Medvedkovo Presnenskij Val 21 Business Apartments CAO / Presnensky PIK 221 1Q 2017 4Q 2018 Loftec Business Apartments CAO / Basmanny Coldy 244 1Q 2017 2Q 2018 Source: BEST-Novostroy, 2018

During 2017, in the context of administrative districts in the primary market of residential real estate of business class, most of the administrative districts recorded a price correction. The biggest decrease was registered in new buildings of the EAO (-9% versus the fourth quarter of 2016), mainly due to the release of a new project (residential complex "Time") and a new building within the framework of the implemented residential complex "Heritage". A similar situation was observed in SWAO and NWAO, in which the average price level in new business class buildings decreased by 5%. In other districts, prices on average were adjusted by 1-3%.

The positive dynamics of prices was fixed in the most popular among the customers of the business class CAO and WAO, where the average price level added 1% since the beginning of 2017. In new buildings SEAO, in which the bulk of the supply is apartments in long-running business class projects (residential complex "Lefort", residential complex "Symbol", etc.), the prices on the average also have added 1%.

With a general decrease in the average level of prices for apartments in new business class buildings, in virtually all types of apartments, the price correction was noted (at the level of 1-7% relative to the fourth quarter of 2016). At the same time, the indicators of the minimum budget for the lots by the end of 2017 are generally higher than those of the end of 2016. The minimum budgets for the apartments are represented in Nevsky residential complex and Wellton Towers: studios - 3.6 million rubles, 1-room apartment - 5, 3 million rubles., 2- bedroom apartment - 5.2 million rubles., Apartments with 3 and 4 rooms - 11.3 million rubles. and 14.0 million rubles. respectively. It is also important to note that throughout the year the conditions for purchasing residential space in new business class buildings remained loyal. When buying an apartment in many residential complexes, there were discounts at 100% payment and mortgages, in addition, on the eve of the holidays, actions that stimulated demand were held.

Chart 29. Distribution of average prices by districts (rubles per sq m)

Source: BEST-Novostroy, 2018

Comfort Class

Supply

During 2017 the primary mass housing market developed most actively: it was replenished with 29 new projects. This figure exceeds the figures for 2016 (18 projects) and 2015 (23 projects). As a result of the reporting quarter, sales were opened in 5 new projects. The market trends are such that often a specific pool of apartments in a residential complex is offered with a complete finish.

In 2017 the primary market of mass housing grew with new projects that were brought to the market by developers familiar with the experience and established reputation. There are practically no new players on the market. Thus, according to the results of the fourth quarter of 2017, there were 289 buildings in the market of comfort and economy-class new buildings in the framework of 83 projects. The total number of buildings increased by more than half compared to the fourth quarter of 2016, and the number of projects increased by more than 40%.

SEAO continued to maintain the lead in the ranking of the metropolitan districts for the fourth quarter of 2017. Compared to the same period in 2016, the district's share increased by 7 percentage points, accounting for 29% of the total supply of apartments. The total number of buildings sold increased 2.5 times to 86 units. The concentration of a significant amount of exposure in SEAO is connected with realization in the district following ambitious projects: residential complex "Quarters 21/19", "Nekrasovka" and “SREDA”. The share of the WAO during the year 2017 changed insignificantly: only 1 new project went on sale (Academician Pavlova LCD), new buildings were added to the “Luchi” and “Meshchersky Les”. As a result of the reporting quarter, the district's share was 14% of the total supply volume (-1% to the fourth quarter of 2016). In SAO placed on 3rd position the volumes of absorption exceeded the increase in exposure due to the start of sales in new projects and new buildings in the exhibited objects. This was due to high sales rates in the residential complex "Varshavskoe shosse 141" and “River Park”. As a result, the district's share decreased to 14% (-4% by the fourth quarter of 2016), although the number of buildings increased from 34 to 41 units.

In NEAO and SWAO in comparison with the fourth quarter of 2016, there was an increase in the number of buildings on sale against the background of a decrease in the proportion of districts in the total supply volume. This situation is explained by the fact that the exposition in the districts grew at a lower rate than the volume of supply in the whole market. VAO and CAO continue to be districts where there are a number of projects.

Chart 30. Division of apartments by districts

Source: BEST-Novostroy, 2018

Despite the active replenishment of the market for new residential buildings with new projects and new buildings within the framework of projects already implemented during 2017, the market demonstrated high construction readiness in Q4 2016 as a result of the year. The share of apartments in the buildings in the initial stages of construction was only 20% of the total supply, 2 times less than a year ago. The volume of apartments for sale in ready-made / commissioned buildings increased to 24% (+7 p.), While the number of such buildings increased to 41% (+14 percentage points). The share of apartments in the buildings at the stage of installation and finishing works reached 55% (+14 pp).

Chart 31. Division of the total supply volume depending on the stage of construction readiness, %

*Outer circle – by number of apartments being sold, %; inner circle – by number of residential buildings under realization

Source: BEST-Novostroy, 2018

According to the results of the fourth quarter of 2017, there is a change in the structure of the offer for apartment types: the share of 1-room apartments (-3 pp) decreased against the background of an increase in the share of 3-room lots (+3 pp). It should be noted that the increase in the total supply volume by more than 20% compared to the fourth quarter of 2016, up to 21.4 thousand apartments for sale, did not have a significant impact on the structure of the primary supply of the mass housing market, and the average area of apartments for sale remained unchanged, amounting to 58.2 square meters, as in the fourth quarter of 2016. The stable structure of the supply over the past 2 years is due, inter alia, to the fact that a significant share of the market is accounted for by projects consisting of several buildings or lines, which implies a minimum variability in the parameters of development: quarter of 2017 from 83 projects on sale, only 35% accounted for point development. Concentration of 70% of projects in the hands of 10 development companies is another reason for maintaining the market structure, since when building several projects within a class, companies tend to adhere to a certain set of planning decisions.

One of the main trends of the market in 2017 was an increase in the supply of apartments with finishing from the builder. Compared to the fourth quarter of 2016, the share of apartments without finishing decreased by 24 percentage points, to 45% of the total supply. In the case of buying an apartment with a turn-key finish, the buyer is often given the choice of several options.

Chart 32. Division of supply by type of apartment, %

Source: BEST-Novostroy, 2018

Chart 33. Division of apartments offer by type of finishing, %

Inner circle – business class; outer circle – premium class

Source: BEST-Novostroy, 2018

Demand

The market of comfort-class buildings, like the capital real estate market in general, depends on the current economic situation, especially on the level of the refinancing rate due to the high proportion of mortgage deals. It is worth noting that the purchasing activity in the primary market of mass housing remains still high due to discounts and promotions, which traditionally reached their peak during the New Year holidays and were practiced by most of developers throughout the year. Discounts apply to a certain pool of apartments and can be provided for the entire amount of exhibited lots at 100% payment / mortgage. The supply of mortgage loans with a reduced rate by leading banks also supports the level of demand. Thus, the number of DDUs registered during 2017 is almost double that of 2015.

Compared to the fourth quarter of 2016, the main changes in the structure of demand for comfort and economy class apartments are observed following the results of the reporting period: a decrease in the aggregate share of 1-room apartments and studios to 47% and at the same time an increase in the share of 3- room apartments up to 15%. The share of 2-room apartments remained unchanged, 36% of total sales.

In the distribution of demand by form of payment in the mass segment, mortgage transactions prevail (60%). More than a third of buyers are ready to fully pay the cost of the apartment, without resorting to a bank loan (36% of transactions). In installments, apartments are purchased in 4% of cases.

As a market trend, it is worth noting a significant increase in the share of apartments, where the finish is offered from the developer. In some residential complexes, finishing is offered as an additional option, that is, its acquisition is not mandatory.

In 2018 it is expected that the primary market of mass housing will continue to develop both due to the appearance of new projects, and new buildings in the exhibited projects. The fluctuations in the average price per square meter will be within the limits of inflation.

Chart 34. Division of demand for apartments in economy and comfort class, depending on the number of rooms, %

Source: BEST-Novostroy, 2018

Commercial terms

According to the results of the fourth quarter of 2017, the average price per square meter in comfort class increased to 150,297 rubles. (2.4% compared to the fourth quarter of 2016). It is worth noting that the inevitable price increase associated with the increased construction readiness of projects was offset by a significant number of new projects and new buildings in the ongoing projects, which were replenished by the market during the year.

Table 15. New comfort-class projects released in 2017

Number of Development project Class Type Location Developer Start of sales Date of comissioning lots Grani Comfort Flats SEAO/Tekstil'shchiki «Osnova» 846 4Q 2017 2Q 2020 Lesoparkovyj Comfort Flats SAO / CHertanovo YUzhnoe INGRAD 623 4Q 2017 4Q 2019 - 2Q 2020 Moj adres v Beskudnikovo-2 Comfort Flats NAO/Beskudnikovskij KP UGS 169 4Q 2017 4Q 2016 Moj adres na Rokossovskogo Comfort Flats EAO / Bogorodskoe KP UGS 534 4Q 2017 3Q 2012 Moj adres na CHertanovskoj / SAO / CHertanovo Comfort Flats KP UGS 124 4Q 2017 4Q 2013 Galaktika TSentral'noe NOVA Alekseevskaya Comfort Apartments NEAO/Alekseevskij KAN'ON-2 341 4Q 2017 2Q 2019 Akademika Pavlova Comfort Flats WAO / Kuntsevo PIK 855 3Q 2017 3Q 2020 Atlas-Dom. Lider v Sadovnikah Comfort Flats SAO/Nagatino-Sadovniki «Lider Invest» 82 3Q 2017 1Q 2019 NEAO / YUzhnoe Polyarnaya 25 Comfort Flats PIK 674 3Q 2017 3Q 2019 Medvedkovo Business- Festival' Park Flats NAO/Levoberezhnyj «TSentr-Invest» 1,093 3Q 2017 4Q 2018- 2Q 2020 minus/Comfort SAO / Orekhovo- Borisovo YAsenevaya 14 Comfort Flats PIK 1,343 3Q 2017 3Q 2019 YUzhnoe Dom 128 Comfort Apartments SWAO / Teplyj Stan «Kortros» 272 3Q 2017 4Q 2018 Flats EAO / Gol'yanovo Level Group 846 2Q 2017 3Q 2019

Level Amurskaya Comfort Apartments EAO/ Gol'yanovo Level Group 332 2Q 2017 3Q 2019 Grinada Comfort Flats SWAO / Severnoe Butovo PSN 1,598 2Q 2017 1Q 20182Q 2019 Esenin-Dom. Lider na Comfort Flats SEAO / Ryazanskij «Lider Invest» 150 2Q 2017 Ȋ 4Q 2018 Volgogradskom Moj adres na Kalitnikovskoj Comfort Flats CAO /Taganskij KP UGS 206 2Q 2017 Ȋ 2Q 2016 Ȋ Lefortovo Park Comfort Flats SEAO / Lefortovo PIK 905 2Q 2017 4Q 2019 Lider v Tushino Comfort Flats SWAO/Severnoe Tushino «Lider Invest» 198 2Q 2017 4Q 2018 Lyublinskij. Dom u skvera Comfort Flats SEAO/Lyublino «Kortros» 279 2Q 2017 4Q 2018 Meridian-Dom. Lider v TSaritsyno Comfort Flats SAO / TSaritsyno «Lider Invest» 111 2Q 2017 4Q 2018 Source: BEST-Novostroy, 2018

The dynamics of the average cost per square meter in the segment of comfort-class for the fourth quarter of 2017 was multidirectional. In 5 districts out of 9, the increase in the indicator was positive. A negative change in the value in the CAO is associated with a small number of projects of the mass segment on sale (2 residential complexes), when a small change in exposure exerts a significant influence on the average cost per square meter. In WAO and EAO, the main reason for the decline in the average indicator was the release of new projects.

Chart 35. Division of average prices of 1 sq. m. in the segment of economy and comfort

Source: BEST-Novostroy, 2018

Rival projects in the immediate neighborhood. Analysis of competitive environment changing perspectives

Table 16. The list of existing competitors in the zone of influence of Noviy Balchug apartment complex

Average area of flats, sqm Asking price, RUR per sqm Residential Type of the Date of one- three- three- three- Address Developer Fitting out Class one-room three-room complex premises commissioning room room room room flats flats flats flats flats flats 34, bld.4, Sofijskaya RC Sofiis ky Apartments ǵǵǵ «Transstroyinvest» 31.12.2018 Shell&core Elite 50.5 67.4 120.8 337,031 347,167 495,767 emb., Moscow 31, st. Sadovnicheskaya, Balchug Residence Apartments AO INTECO completed Shell&core Elite - 74.0 116.5 548,039 514,868 M os co w 3-7, st. Balchug Viewpoint Apartments Sadovnicheskaya, AO INTECO 01.07.2018 Shell&core Elite 46.4 68.1 111.3 645,795 523,966 591,256 M os co w 82, bld.5, Sofijskaya RC A-Residence Apartments ǵ1 Properties 01.10.2019 Fitted-out Elite 63.5 79.3 120.3 383,444 347,039 351,722 emb., Moscow 6, Ordinsky bay, RC Barkli Gallery Flats BARK LI 01.04.2018 Fitted-out Elite - 78.7 159.8 884,362 1,040,000 M os co w RC Do m na 3, 4th- Kotelnicheskiy Flats Russki Monolit completed Shell&core Elite 60.0 84.5 127.8 895,109 822,689 821,008 Kotelnicheskoy lane, Moscow

Table 17. The list of existing competitors in the zone of influence of Leningradskoye Shosse residential complex

Average area of flats, sqm Asking price, RUR per sqm Type of Date of Fitting one- three- three- one- three- three- Residential complex the Address Developer Class commissioning out room room room room room room premises flats flats flats flats flats flats RC Mayakovsky Flats 10, bld. 1, Goloviskoe h/w, Moscow TEKTA GROUP 31.12.2018 Shell&core Comfort 43.6 64.5 85.6 182,913 172,156 168,123 RC White park Flats 9, Belomorskaya, Moscow Center Invest completed Shell&core Comfort 46.8 68.0 120.2 181,566 167,767 163,000 RC Bazovskoy Flats 15, bld. 1, 3, 4, 7, Bazovskaya st., Moscow KP «UGS» completed Shell&core Comfort 47.0 63.8 - 180,218 167,710 RC Nevsky Flats 7, Vyborgskaya, Moscow Krost completed Shell&core Comfort - 56.3 80.7 120,869 114,545 RC Duet Flats 10, Deguniskaya, Moscow Grad Invest Deguninskaya 31.12.2018 Shell&core Comfort 29.9 47.4 64.0 168,737 202,382 211,673 RC Dom na Voikovskoi Flats 8, bld. 8, Starokoptevski lane, Moscow Valdai Service 01.10.2018 Shell&core Comfort 34.7 54.9 78.3 159,898 143,033 144,205 RC Kronshtadski Flats 49, bld. 1, Kronshtadski blvd., Moscow Stroycenter + 01.07.2018 Shell&core Comfort 39.1 63.6 76.5 196,910 195,071 194,437 RC Festival Park Flats 27, Festivalnaya, Moscow Center Invest completed Shell&core Comfort 55.3 73.3 151.7 197,738 219,545 149,451

Table 18. The list of existing competitors in the zone of influence of Donskoy Olimp residential complex

Average area, sqm Asking price, RUR per sqm Date of Type of the one- three- three- one- three- three- Residential complex Address Developer commissioni Fitting out Class premises room room room room room room ng flats flats flats flats flats flats 20, Serpukhovskoy disrt., RC Dom na Serpukhovskom Flats Lider Invest completed Shell&core Business 61.9 69.5 - 281,908 260,403 M os co w RC Baikonur Flats 13, Ordzonikidze st., Moscow Vostok Development 01.07.2018 Shell&core Business 44.2 62.0 114.5 333,025 325,806 325,764 RC Vavilova 4 Flats 4, Vavilova st., Moscow PIK 31.12.2018 Shell&core Business 62.9 120.6 130.8 320,119 329,782 391,763 RC I'm Apartments / Fla ts 4, Kozevnicesky lane, Moscow PSN Gr o up completed Shell&core Business 45.5 56.5 97.7 385,878 417,833 397,562

Table 19. The list of existing competitors in the zone of influence of ZILART and ZILYUG residential complex

Average area, sqm Asking price, RUR per sqm Type of the Date of Fitting Residential complex Address Developer Class one- three- three- one- three- three- premises commissioning out room room room room room room flats flats flats flats flats flats

RC Nagornaya 7 Flats 7, Nagornaya, Moscow Ringo Trade 01.10.2018 Shell&core Business 59.0 78.8 90.1 187,980 186,580 184,328

RC Residencii Compositorov Apartments 8, Paveletskaya emb., Moscow AFI Development 01.10.2017 Shell&core Business 49.4 60.5 90.2 203,033 235,288 196,139

RC Sky fort ș Flats 11, bld. 1, 2, 3, Nagatinsky blvd., Moscow Stolica completed Shell&core Comfort - 87.6 108.0 186,492 171,462

RC Lider v Sadovnikah Flats 4, Nagatinskaya st., Moscow Lider Invest 31.12.2018 Shell&core Comfort 44.9 66.6 86.9 191,722 190,024 195,846

RC Park Legend Flats 23, Avozavodskaya st., Moscow TEN 31.12.2018 Shell&core Business 44.5 64.3 86.6 175,790 174,396 179,452

RC Dom na Nagatinskoy Flats 14, 1st Nagatinsky blvd., Moscow Lider Invest Shell&core Comfort 43.6 69.7 102.6 239,406 226,398 199,304

RC Nakhimovski 21 Apartments 21, Nakhimovsky blvd., Moscow MD Group completed Shell&core Business 46.7 54.2 - 119,485 119,142

RC River park Apartments / Flats 15, Korabelnaya st., Moscow Rechnikov Invest 01.04.2018 Shell&core Comfort 40.5 59.4 87.2 184,142 177,049 175,796

RC Vavilova 4 Flats 4, Vavilova st., Moscow PIK 31.12.2018 Shell&core Business 62.9 120.6 130.8 329,782 391,763 330,171

Table 20. The list of existing competitors in the zone of influence of Luchi residential complex

Average area, sqm Asking price, RUR per sqm Residential Type of the Date of Fitting Address Developer Class one- three- three- one- three- complex premises commissioning out one-room room room room room room flats flats flats flats flats flats

RC Mescherskiy Les Flats 2C, Borovskoe h/w, Moscow Lider Invest 1 ȑȉ. 2018 Shell&core Comfort 40.48 62.63 90.35 131,206 121,449 110,748

RC Positive Flats 1, Rodnikovaya st., Moscow Capital Group 1 ȑȉ. 2019 Shell&core Comfort 38.60 58.23 75.04 116,245 108,824 103,477

RC Peredelkino Flats Rasskazovka settl., Moscow Absolute Nedvizimost completed Shell&core Comfort 39.62 56.55 81.78 141,676 133,550 131,103

RC Rasskazovo Flats Rasskazovka settl., Moscow SE ZAR GROUP 3 qtr. 2018 Shell&core Comfort 41.96 65.23 89.67 128,344 131,144 130,127

RC Tatianin Park Flats 11-17, Tatianin Park st., Moscow MITS completed Shell&core Comfort 49.54 70.75 98.56 134,257 131,291 142,977

RC Pikasson Flats 35, bld. 1,2,4. Ozernaya st., Moscow Mangazeya Development 3 qtr. 2018 Shell&core Comfort 39.58 62.36 95.16 174,466 174,469 174,761

Table 21. The list of existing competitors in the zone of influence of Nakhabino Yasnoe residential complex

Average area, sqm Asking price, RUR per sqm Type of Residential Date of Fitting one- three- one- three- one- three- the Address Developer Class complex commissioning out room room room room room room premises flats flats flats flats flats flats RC Ska zka Flats 9, Krasnaya, Pavlovskaya settl. Sodruzestvo completed Shell&core Comfort 53.9 68.2 95.2 94,917 97,197 107,361 RC Nakhabino Flats 57, Krasnoarmeyskaya, Nakhabino settl. PIK 1 q tr . 2018 Shell&core Comfort 40.7 - 81.6 69,045 62,126

RC Bereg Na kha b ino Flats 70, Krasnoarmeyskaya, Nakhabino settl. Investment in Moscow Region completed Shell&core Comfort - - 94.0 50,108

RC Nakhabino Skver Flats 1-17, Isakovo settl. Russtroyinvest completed Shell&core Comfort 38.8 59.0 74.8 70,301 73,371 64,863 RC Pavlovski K vartal Flats 1-29, Novaya st., Lobanovo settl. OPIN 3 q tr . 2018 – 4 q tr . 2020 Shell&core Comfort 43.6 67.9 86.9 66,571 62,633 58,974 RC Novosnigerevski Flats 1-10, 16, 18, Serenivy blv., Pavlovo Snegiri settl. Istrinskie Dali 4 q tr . 2018 Shell&core Comfort 46.9 75.9 101.7 46,628 44,432 41,356

Table 22. The list of existing competitors in the zone of influence of Novoe Domodedovo residential complex

Average area, sqm Asking price, RUR per sqm Date of Residential Type of the one- three- one- three- one- three- Address Developer commissionin Fitting out Class complex premises room room room room room room g flats flats flats flats flats flats Comfor RC Gorod Schatstia Flats Vostrykovo distr., Domodedovo Lider Group completed Shell&core 32.5 54.5 75.3 64,000 60,084 59,000 t 1, 2, 3, Zapadny distr., Comfor RC E vr opeis ky Flats Stroyteks completed Shell&core 43.9 60.5 - 90,395 78,102 Domodedovo t 33a, Lunnaya st., Zapadny distr., Comfor RC Lunny Flats SMR Story completed Fitted-out 45.5 69.3 86.9 82,301 71,406 69,054 Domodedovo t 3, bld. 1, Vysotnaya st., Comfor RC Domodedovo Flats Constructor completed Shell&core 38.1 60.8 84.0 57,412 47,851 42,970 Domodedovo t RC Lybimii Comfor Flats 4-9, Zapadny distr., Domodedovo Mosoblstroyinvest completed Shell&core 41.3 65.2 78.0 80,278 74,115 70,137 Domodedovo t

Table 23. The list of existing competitors in the zone of influence of Kracnyj Mayak residential complex

Average area, sqm Asking price, RUR per sqm Type of Date of Fitting one- three- one- one- three- Residential complex the Address Developer Class three-room commissioning out room room room room room premises flats flats flats flats flats flats RC Lider na Chertanovsloy Flats 59, Chertanovskaya st., Moscow Lider Invest 1 q tr . 2019 Shell&core Comfort 40.00 61.85 91.99 176,665 174,300 170,461 RC Lesoparkovii Flats 170E, Varshavskoe h/w, Moscow INGRAD 4 q tr . 2020 Fitted-out Comfort 41.13 57.19 80.54 119,837 112,890 108,143 RC Lider Tsaritsino Flats 27, blvd. 2, Kavkazsky blvd., Moscow Lider Invest 4 q tr . 2018 Shell&core Comfort 39.97 60.20 78.02 177,213 183,031 189,524 RC Or ekhovo-Borisovo Flats 26, blvd. 9, Generala Belova st., Moscow RG Development 3 qtr. 2019 Shell&core Comfort 37.20 59.59 78.88 163,502 136,143 130,302 RC Gorizont Flats 16, Balaklavsky dstr., Moscow Businessland completed Shell&core Comfort - 61.85 109.31 174,653 174,380

Residential market overview of Yekaterinburg

Supply

The real estate market in the Sverdlovsk region is developing in a general trend. Despite the world crisis, the volume of construction works continues to grow.

Active work of developers led to emergence of a large number of real estate on the primary market. In the first 2 quarters of 2017, the volume of the market of residential real estate in Yekaterinburg was about 2.25 million square meters (an increase of 7% in comparison with Q1 2017).

The high level of supply remains about 17 thousand apartments on the primary market, while developers quickly replace the sold offers by new ones. It means that real estate market is still the market of the buyers. Approximately 20% of the 17,000 apartments (about 3,500 apartments) are ones that are situated in buildings that are put into operation.

As for resedential typology, the majority of supply on the market of new buildings occupy small-sized apartments, but at the same time the volume of the supply is shifting to the segment of comfort class.

The volume of the construction on hold is growing. In 2016 the volume of the construction on hold in the city increased by 3.5 times (318,000 sq. m), according to the results of the first six months of 2017 the construction on hold increased by 11% (353,000 sq. m). Thus, today the total share of the “frozen” housing is 19%.

Chart 36. Gross building area of residential buildings under construction in Yekaterinburg, mln sq. m

Source: Knight Frank Research, 2018

Chart 37. Supply of housing in in Yekaterinburg, number of apartments (end of the year)

Source: Knight Frank Research, 2018

Chart 38. Territorial structure of residential buildings under construction

Source: Knight Frank Research, 2018

Chart 39. Structure of new residential complexes by the stage of construction, %

Source: Knight Frank Research, 2018

Chart 40. Supply of apartments on the primary market in Yekaterinburg (%)

Source: Knight Frank Research, 2018

Chart 41. Supply of apartments on the primary market in Yekaterinburg (%)

38%

Source: Knight Frank Research, 2018

Professional participants of Yekaterinburg real estate market divide the city into 5 price zones depending on the distance from the center. Each zone includes several city districts. The districts are distributed by price zones as follows:

i The Downtown (the Center, the Central area), limited by Moskovskaya St., Chelyuskintsev St., Vostochnaya St., Dekabristov St., Lunacharskogo St. and Bol’shakova St.; i Zone 1, embracing neighborhoods of Avtovokzal (Bus Station), Botanichesky, VIZ (Upper Iset’ Metallurgical Plant), Vokzal’ny, VTUZgorodok, Zarechny, Parkoviy, Pionersky, Shartashsky Rynok (Shartash Market) and Yugo-Zapadny (South-Western); i Zone 2, including Akademichesky, ZhBI (Concrete Factory), Zavokzal’ny, Novaya Sortirovka, Sibirsky, Siniye Kamni (Blue Stones), Uktus, Uralmash, Shirokaya Rechka (Broad River) and El’mash; i Zone 3, comprising Elizavet, Kompressorny (Compressor), Lechebny, North Sortirovka, Sovkhoz, UNC (Ural Scientific Center), Khimmash and Chermet; i Zone 4, comprizing Verkhnemakarovo, Gorny Schit (Mountain Shield), Izoplit, Istok, Kalinovsky, Kol’tsovo, Medniy, Nizhne-Isetsky, Palkino, Ptitsefabrika (Poultry Farm), Pyshma, Rudny, Sadovy, Severka, Sem’ Klyuchey (Seven Springs), Chusovskoye Ozero (Chusovskoye Lake), Shabrovsky, Shartash and Shuvakish.

Map 5. Division of the city by the price zones

Source: Knight Frank Research, 2018

Main housing construction is carried out in two locations, in Zone 1 and in Zone 2 – 76% of the total volume of housing under development in Yekaterinburg. This figure has increased by 4% during the last year and the ratio of locations has altered. Yet in 2014 the most active construction took place in the zone 2, and then zone 1 took the leadership in 2015. The share of the Central area accounts for about 11% of the market, which is 4% more than in 2015 year.

Chart 42. Distribution of housing under construction of Yekaterinburg by price zones, %

Source: Knight Frank Research, 2018

Chart 43. Volume of housing by districts in Yekaterinburg th. sq. m

Source: Knight Frank Research, 2018

Demand

Chart 44. Sales dynamics in Yekaterinburg primary residential market

Source: Knight Frank Research, 2018

In general, the demand on apartments increased in 2017. On the primary market sales increased by 17%. These are very good indicators; the situation has been affected by several factors. First of all, the supply is adapting to current demand. The market is slowly evolving. New projects are being built and they are more suitable for current buyers. Secondly, the decrease of mortgage rates maintains the consumers’ interest. Thirdly, marketing strategies of the sellers were very effective on the primary market: a lot of discounts, complex offers (for instance, an apartment and a garage), installments are possible.

It is important to note, that there is interest in the apartments on the primary market that are already put into operation. The amount of purchase transactions of residential buildings at the initial stage of construction has decreased significantly for the past year.

Comfort class construction is becoming most demanded on the market of new buildings in Yekaterinburg. About a half of participants of equity construction in 2017 bought apartments of comfort class. Earlier construction of economy class was an undisputed leader. Now economy class apartments occupy only a third of the sales. A share of 5-5.5% occupy apartments of business class, and the remained 1-1.5% fall on prime properties.

Yekaterinburg differs from the other regional centres, where economy class construction are the most demanded ones.

To analyze the Projects, qualitative parameters of demand were considered depending on the buyers' requirements, depending in their turn on the class of housing. Regarding the classification of the housing

market, one should note that today there is no uniform standard classification and the criteria approved by the legislation, which would give a clear division of property in the Russian Federation by classes. Each region has its own specificity. As a consequence, there is no clear evaluation of the object parameters to assign it to a particular segment of the housing market. In the research, an expert has determined the class of a property by the classification adopted in Knight Frank company, given the basic criteria:

x location (district)

x proximity to big thoroughfares and transport hubs (for determining the degree of comfort for residents)

x social status of residents

x structural and technical, architectural and planning characteristics of the house

x the number of units in the house and on the floor

x minimal area of an apartment

x the quality of construction and finishing materials

x engineering

x availability of adjacent territory, parking and the number of parking spaces per apartment

x infrastructure (kindergarten, school, stores)

x professional building management

Principal requirements:

Buyers of mass demand housing are mainly focused at:

x transport accessibility (proximity to the stopping points, ability to get to the city center);

x developed infrastructure (availability of kindergartens, schools, food stores);

x turnkey finishing (no additional costs for finishing premises);

x minimal footage of units (1-room - from 30 sqm, 2-room - from 45 sqm, 3-room - from 65 sqm; no overpayment for corridors, balconies and loggias);

x location (this group of consumers is less likely to move and is more inclined to stay in the area of residence).

Relevant buying schemes for this group of customers are as follows:

x secondary housing in offset when paying for an apartment

x payment in installments

x mortgage

Buyers of business-class housing pay special attention to the following features:

x location of the house;

x proximity to transport interchanges, local city centers, shopping centers;

x quality fit-out of an apartment;

x open or underground parking available;

x well-maintained house territory, playground, bicycle stands and professional property management company;

x convenient apartment layouts, availability of auxiliary rooms and balconies.

Buyers of elite housing pay special attention to the following features:

x multi-system protection, private territory;

x the object appearance - number of floors, design of adjoining territory and of in-house spaces;

x adjoining the house and nearby infrastructure;

x comfortable and safe parking, underground parking with car wash;

x ceiling height over 3 m;

x duplex apartments and penthouses;

x professional management company.

A significant part of the demand on the market is made by transactions in which financing based on sales of apartments on the secondary market. Strong reduction in demand and a significant increase in supply on the secondary market had an indirect impact on the primary market.

Table 24. The analysis of paces of sales of apartments in Yekaterinburg, economy and comfort class

Total amount of Pace of sales, Residential Complex apartments apartments per month Bazilik 484 14 Lomonosov 454 2 Mendeleev 446 3 Yaskina 12 320 4 Aviator 335 6 Samotsvety (Agat, House 1) 168 8 Greenwood 174 2 Residential complex at Tenistaya street 447 10 Suhodolskiy Kvartal 325 9 Ryabinoviy Kvartal 1088 41 Novella 350 6 Semitsvet 508 6 Symphoniya 357 9 Kvartet 520 3 Repin Park 471 9 Regata 192 4 Lubov’ 243 5 Liga Championov 338 15

Total amount of Pace of sales, Residential Complex apartments apartments per month Avangard 316 12 Ural’skiy 716 10 Alpha 206 5 Oazis 280 6 Residential complex at Teplichnaya street 298 5 Residential complex at Electrikov street 109 2 Atlant 207 4

Source: Knight Frank Research, 2018

Commercial Terms

From 2009 till 2014 years one could observe the positive dynamics of prices in the primary market of Yekaterinburg. A marked increase in prices for housing under construction has occurred against the background of the sales surge in 2014. However, the market began to change due to changes in the economic situation. Last two years there is a negative trend on the market. Nevertheless, the average price per 1 sqm remains quite high and doesn’t fall lower than price at the end of 2013 year.

The average price per 1 sq. m as at the end of 2017 equaled 68,088 rubles, this is 1.9% lower than in 2016.

Chart 45. Dynamics of the average price for housing under construction in Yekaterinburg, th. rub. /sqm

Source: Knight Frank Research, 2018

Chart 46. Dynamics of the average price 1 sq. m of the total area of the apartments (rubles)

Source: Knight Frank Research, 2018

Chart 47. Prices depending on location

Source: Knight Frank Research, 2018

By the end of 2017, the average price for 1 square meter on the primary market in the central part of the city was approximately 2 times higher than in the suburbs. The average price of the city center for 2017 decreased by 7.8%. Other zones showed less significant dynamics.

Map 6. Average prices distributed by Yekaterinburg price zones and its annual dynamics11.

Source: Knight Frank Research, 2018

Prices depending on the type of the apartment

By the end of 2017, the average price for 1-room apartments were 70,901 rubles per sq. m. Prices for 2-room apartments on average were 66,864 per sq. m; prices for 3-room apartments were 66,180 rubles per sq. m.

11 The average prices are cited as of December 2016. The price dynamics is given compared to September 2016.

Chart 48. Prices depending on the type of the apartment

Source: Knight Frank Research, 2018

Table 25. Economy and comfort flats price change by type in 2016

1-room 2-room 3-room 2017 Dynamic, % 2017 Dynamic, % 2017 Dynamic, % 70 901 -1,1% 66 864 -3,1% 66 180 -1,4%

Source: Knight Frank Research, 2018

Professional Opinion Regarding Market Development Perspectives

Despite the decrease in price on the residential market, some specialists talk about a probable significant rise in prices on housing. Some developers are already raising prices, but these are only single cases. Mass increase in prices can begin from the second half of March, according to experts’ opinion.

No significant changes in prices are expected in the future year. Considerable volume of supply on the market will become the main deterrent. Prices may rise in separate projects and segment, but the overall increase in property prices in Yekaterinburg is unlikely to noticeably overtake inflation. However, even now the majority of construction companies are removing discounts and special promotions

Rival projects in the immediate neighborhood. Analysis of competitive environment changing perspectives

Table 26. The list of existing competitors in the zone of influence of Rassvetniy and Voshod residential complexe

one- two- three- Type of the Date of room Residential complex Address Developer Fitting out Class room room premises commissioning flats flats price flats price price Lomonosov Flats 43, Mira St. Pervostroitel’ commissioned Shell&core Comfort 89,556 84,565 77,155 Mendeleev Flats 41, Mira St. Pervostroitel’ commissioned Shell&core Comfort 86 032 80,622 70,748 Malevich Flats Mayakovskaya St. Brick commissioned Shell&core Comfort 81,442 74,319 74,750 Malevich Flats Mayakovskaya St. Brick commissioned Shell&core Comfort 81,358 73,355 73,767 Not in Bazilik Flats 27, Bibliotechnaya St. Victoria invest commissioned Shell&core Comfort 72,355 67,805 sale Not in Not in Bazilik Flats 25A, Bibliotechnaya St. Victoria invest 15.02.2018 Shell&core Comfort 78,462 sale sale

Table 27. The list of existing competitors in the zone of influence of Khrustal’niye Klyuchi residential complex

one- three- Type of the Date of room two-room Residential complex Address Developer Fitting out Class room flats premises commissioning flats flats price price price Fully fitted Aviator Flats 7, Ytrenniy Avenue Efes commissioned Economy 58,280 54,000 Not in sale out Fully fitted Not in Samotsvety Flats Futbolno-Latviiskaya St. Turgas 15.04.2018 Comfort Not in sale 51,261 out sale Fully fitted Samotsvety Flats Futbolno-Latviiskaya St. Turgas 15.04.2018 Comfort 52,316 Not in sale 47,500 out Fully fitted Svetlyi Flats Slavyanckaya St. TEN commissioned Comfort 59,901 56,745 Not in sale out

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 329

Table 28. The list of existing competitors in the zone of influence of Michurinskiy, Akademichesky and VIZ residential complexes

three- Type of the Date of one-room two-room Residential complex Address Developer Fitting out Class room flats premises commissioning flats price flats price price Residential complex at Flats Tenistaya-Suhodolskaya St. AtomStroyKomplex commissioned Fully fitted out Economy Not in sale Not in sale 50,159 Tenistaya street Residential complex at Flats Tenistaya-Suhodolskaya St. AtomStroyKomplex commissioned Fully fitted out Economy Not in sale Not in sale Not in sale Tenistaya street Smorodina Residential complex at Tenistaya Flats Tenistaya-Suhodolskaya St. AtomStroyKomplex commissioned Fully fitted out Economy Not in sale 52,352 Not in sale street Suhodolskiy Kvartal Flats Suhodolskaya St. Brusnika 15.02.2019 Shell&core Comfort 59,318 55,991 51,332 Kortros Akademicheskoye Akademicheskiy Flats Krasnoselskaya St. commissioned Fully fitted out Comfort 65,000 65,000 66.744 Group Ryabinoviy Kvartal Flats Krasnoselskaya St. ǱomStri 15.05.2018 Shell&core Comfort 58,986 Not in sale 51.723 Ekateriniskaya- Novella Flats Stroitech commissioned Fully fitted out Economy 54,000 Not in sale 46,966 Suhodolskaya St.

Table 29. The list of existing competitors in the zone of influence of Rastochnaya residential complex

Type of the Date of one-room two-room three-room Residential complex Address Developer Fitting out Class premises commissioning flats price flats price flats price Semitsvet Flats Tehnicheskaya-Druzhininskaya St. AstraInvestStroi commissioned Fully fitted out Economy 63,365 Not on sale Not in sale Symphoniya Flats 13, Kourovskaya St. Zheldoripoteka 01.10.2017 Shell&core Comfort Not in sale 65,000 Not in sale Kvartet Flats 30, Maneuvrovaya St. UIT Uralstroi commissioned Shell&core Comfort 69,938 67,204 Not in sale

Table 30. The list of existing competitors in the zone of influence of Flagman residential complex

one- three- Type of the Date of room two-room Residential complex Address Developer Fitting out Class room flats premises commissioning flats flats price price price Fully fitted Not in Repin Park Flats 75, Zavodskaya St. Aston commissioned Comfort Not in sale 63,069 out sale Fully fitted Regata Flats 126, Taticheva St. NKVS-Development commissioned Comfort 76,461 Not in sale 68,862 out

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 330

one- three- Type of the Date of room two-room Residential complex Address Developer Fitting out Class room flats premises commissioning flats flats price price price ǧ, 1Ǩ, 1ǩ, 1Ǫ, Fully fitted Lubov’ Flats NKVS-Development 15.05.2018 Comfort 74,532 Not in sale 62,540 Uhtomskaya St. out Liga Championov Flats Yasnaya-Shaymyana St NKVS-Development commissioned Shell&core Comfort 82,797 73,024 72,832 Not in Liga Championov Flats Yasnaya-Shaymyana St NKVS-Development commissioned Shell&core Comfort Not in sale 68,556 sale Fully fitted Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 72,710 71,591 65,205 out Fully fitted Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 72,643 Not in sale 70,000 out Fully fitted Not in Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 72,145 Not in sale out sale Fully fitted Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 76,440 72,215 67,422 out Fully fitted Not in Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 71,545 Not in sale out sale Fully fitted Milleneum Flats Gromova St. Vash Dom Corporation commissioned Comfort 69,875 Not in sale 75,107 out

Table 31. The list of existing competitors in the zone of influence of Tsvetnoy Bulvar (Blukhera) residential complex

one- two- three- Type of the Date of room Residential complex Address Developer Fitting out Class room room flats premises commissioning flats flats price price price Pionersky Flats 68, Irbitskaya St. KVSP commissioned Shell&core Comfort 79,816 80,547 77,343 Fully fitted Ural’skiy Flats Bluhera-Sahalinskaya St. Efes commissioned Comfort 66,842 67,102 57,310 out Not in Sovremennik Flats 99,Bluhera,St. Stroitech commissioned Fully,fitted,out Comfort 61,000 59,000 sale

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 331

Table 32. The list of existing competitors in the zone of influence of Shefskaya residential complex

three- Type of the Date of one-room two-room Residential complex Address Developer Fitting out Class room flats premises commissioning flats price flats price price Fully fitted Econom Alpha Flats Tsvetochniy av. Formula Stroitel’stva 15.11.2018 65,840 63,326 66,171 out y 1A Staryh Sredneural’skoe Comfor Oazis Flats commissioned Shell&core 61,000 56,952 Not in sale Bolshevikov St. Stroitel’noe Upravleniye t Residential complex at Econom Flats 5 Electrikov St. Efes commissioned Shell&core 60,000 Not in sale Not in sale Electrikov street y 3 Staryh Econom Atlant Flats Stroitech commissioned Shell&core Not in sale 60,000 54,536 Bolshevikov St. y

Sources of market data:

x http://novosel99.ru/nedvizhimost/novinki-kataloga/1744 x https://www.znak.com/2017-12-18/zhile_komfort_klassa_stanovitsya_samym_vostrebovannym_v_ekaterinburge x http://ekb.dk.ru/news/krupneyshie-zastroyschiki-ekaterinburga-reyting-237086631 x http://domiofis.ru/2017/12/08/rynok-nedvizhimosti-ekaterinburga-v-2017/ x http://xn----8sbagnv0bvv.xn--p1ai/index.php/1058-pressuxa2017 x http://urbanus.ru/news/ngroup_city/nedvizhimost-ekaterinburga-glavnye-igroki-na-rynke-novostroek/

Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO- 36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 332

Appendix 4 – Residential market segmentation according to the current classification

The classification of modern residential buildings supposes differentiation of projects according to the following basic characteristics: x Location; x Areas and proportion of different types of apartments; x Parking availability and its characteristics; x Constructional type; x Number of storeys in the building; x Average apartment12 area.

We define the following classes of multi-apartment houses in the residential real estate market of Saint- Petersburg: x Class A (prime) which in its turn is subdivided into 2 subclasses: A+ and A. x Class B (middle-class), which is also subdivided into 2 subclasses: higher middle-class (B+) and class B. x Class C (mass-market residential real estate), which is subdivided into 2 subclasses: higher mass-market class and lower mass-market class residential real estate.

Table 33.Market segmentation according to the modern classification

C B A Characteristics C C+ B (comfort) B+ (business) A (elite A) A+ (elite A+) (economy) (medium) Prestigious zones of non- central districts; The most Non-central Historical centre; embankments prestigious districts, embankments Location Non-central districts outside the zones of prestigious with scenic borders of historical suburbs views historical centre centre; prestigious suburbs Large Panel Large Panel System System Brick or brick Brick or brick Brick or brick & Brick or brick building; building(rare Constructional & reinforced & reinforced reinforced & reinforced brick and ly); type concrete concrete concrete concrete reinforced brick and building building building building concrete reinforced building with concrete

12 hereafter an ‘apartment’ means a residential premise; a ‘unit’ means a residential premise or an aparthotel room/flat, literally a non- residential premise

C B A Characteristics C C+ B (comfort) B+ (business) A (elite A) A+ (elite A+) (economy) (medium) small building apartments Storey number (prevailing in a Of no importance Up to 16 Up to 12 Up to 9 residential complex) Apartment number on a Of no importance Up to 7 Up to 5 Up to 4 stairwell, item Parking index, place number Of no importance From 0,5 From 0,7 From 1,1 per one apartment Placing offices, service Placing offices industries and and service Non- trade is No industries is Mainly for residential No requirements possible. Public requirements possible, internal use premises catering and excluding public food products catering are not preferred Studios – 0% Studios – to Studios – 0% Studios – 0% Studios – to Studios – to 1 room – 0% 5% 1 room – to 1 room – to 15% 50% 15% 2 room -15- 1 room – 30- 25% 2 room – 25- Usual 1 room – to 1 room – 35- 25% 40% 2 room – 30- 35% apartments 70% 45% 3 room – 40- 2 room – 35- 40% 3 room – 35- ratio by room 2 room – to 2 room – 25- 60% 45% 3 room – 35- 50% number 30% 35% 4 room – 15- 3 room – 20- 45% 4 room – to 15% 3 room – to 3 room – 15- 25% 35% 4 room – to Multiroom – to 15% 20% Multiroom – to 4 room – to 5% 10% 2% 10% Average apartment From 35 From 52 From 65 From 80 From 110 From 130 area, sq.m Source: Knight Frank St Petersburg, 2017

Appendix 5 – Office market segmentation according to the current classification

Table 34.Market segmentation according to the modern classification

Class A Class B+ Class B-

1. BUILDING ENGINEERING SYSTEMS

1.1. Building Management System (BMS)

must must recommended

1.2. Heating Ventilation and Air-Conditioning (HVAC)

HVAC system that provides all- HVAC system that provides the-year-round cooling, heating Heating, Ventilation and Air cooling, heating and humidity and humidity control within Conditioning systems. control. individual premises.

must must must

Recommendation: four-pipe AC.

1.3. HVAC capacities

Capacity to provide 24-hour and all-the-year-round cooling in server rooms. Temperature in office areas: 22 C0 ± 1 C0. Fresh air supply: 60 m3 per hour per 10 sqm of office rentable space, according to planned occupancy.

must optional recommended

1.4. Modern fire security system

which includes fire detection, fire alarm and fire suppression.

must must must

1.5. Elevators

Modern high quality speed elevators from major Modern elevators for 4-storey buildings and higher. international brands.

must must must

1.6. Maximum waiting time of elevators

No longer than 30 seconds.

must recommended recommended

Recommendation: an intelligent elevator control system to be

installed in the buildings with 20 or more floors.

Class A Class B+ Class B-

1.7. Power supply Two independent sources of power supply with automatic change-over or diesel generator power supply system as emergency backup (power supply should be a minimum 70 VA of the one-time electric load per 1 sqm effective office space), UPS for emergency systems.

must optional recommended

1.8. Security system Modern security and access Modern security and access control systems: CCTV at all control systems: CCTV at all CCTV at all entrance points, 24- entrance points, around the entrance points, around the hour security personnel. Access building, at parking areas, building, at parking areas, control. electronic card access, 24-hour electronic card access, 24-hour security personnel. security personnel.

must must must

2. BUILDING STRUCTURE

2.1. Clear ceiling height: min 2.7 m and over

must must recommended

2.2. Layout

Open floor plates, efficient Open floor plates, efficient layout, Open floor plates for the whole layout, supporting columns. supporting columns. Regular Regular column grid: not less or more than 50% of office column grid: not less than 6×6. than 6×6. rentable area, efficient layout.

must must recommended

Recommendation: For not less than 90% of usable area distance

from windows to columns should not be less than 4 m.

2.3. Floor depth

Floor depth: not more than 20 m from window to window. Not more than 10 m from window to floor plate core and 12 m for buildings with non-regular forms and atriums.

must optional recommended

2.4. Loss factor

Building loss factor: not exceeding 12%. Areas are calculated according to BOMA standards.

must must recommended

Class A Class B+ Class B-

2.5. Load bearing capacity: not less than 400 kg/sqm

must optional recommended

2.6. Fit-out of common areas and facade finishing

High quality materials used in fit- Quality materials used in fit-out of common areas and facade out of common areas and facade finishing. finishing.

must must must

2.7. Raised floors

Building is designed for full value Possibility to install raised floors. raised floor installation.

must optional recommended

2.8. Lighting & window grid

Modern high quality windows providing sufficient natural lighting.

must must recommended

3. LOCATION

3.1. Location

Good building location, an absence of nearby objects that can have a negative impact on a building’s image

(e.g. functioning industrial buildings, dumps, etc.).

must optional recommended

3.2. Transport access

Location within not more than 15-minute walks from the nearest metro station or an adequately organized shuttle-bus service (waiting time of about 5–15 minutes during morning and evening peak traffic periods).

must optional recommended

4. PARKING

4.1. Parking type

Underground parking or covered multilevel parking. Surface guest Organized guarded parking. parking.

must must must

Class A Class B+ Class B-

4.2. Parking ratio

- Within the Garden Ring: not less than 1 space per 100 sqm of leasable area (1/100).

recommended recommended recommended - Between the Garden Ring and the Third Ring Road: not less than 1/80;

- Between the Third Ring Road and MKAD: not less than 1/60;

- Outside MKAD: 1/30–1/40 or more. must must recommended

5. OWNERSHIP

5.1. Single ownership (the building is not sold by floors or blocks to different owners)13

must optional recommended

6. PROPERTY MANAGEMENT & SERVICES FOR OCCUPIERS

6.1. Property management

Professional property management company with not less than 5 buildings under Organized property Property management company. management (not less than management. 5,000 sqm each) or with relevant international experience.

must must must

6.2. Telecom providers

No exclusive telecom provider. Potential possibility to use services of two or more independent telecom providers.

must must recommended

6.3. Lobby

Efficiently organized reception area appropriate to building size, providing convenient access to the building. Well organized waiting zone.

must optional recommended

6.4. Amenities

13 Not applicable for multifunctional complexes (MFC) comprising office and retail premises or apartments

Class A Class B+ Class B-

Professionally organized staff cafeteria adequate to building size and populationȥ At least two Staff cafeteria and other amenities in the building (ATM, newsstand, more amenities in the building dry-cleaning, shops, etc.). Infrastructure nearby should be considered. (ATM, newsstand, dry-cleaning, shops, etc.). Infrastructure nearby should be considered.

must must must

7. CERTIFICATION 7.1. Certification according to one or more international environmental assessment methods for buildings (e.g. BREEAM or LEED) recommended recommended recommended Source: Knight Frank St Petersburg, 2017

Appendix 6 – Valuation of properties located in Germany

57. Leipzig

Asset-ID 57 Country Germany Brandenburger Str. / Sachsenseite, 04103 Inspection Georgios Address Leipzig by Drakatos Date of valuation 31.12.2017 Date of Inspection 23.02.2018

Overview

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The subject property is a project development of two inner city hotels at the east side of the main station of Leipzig. The development comprises a two-star budget hotel operated by H2 as well as a four-star hotel operated by Hyperion (previously Ramada). The two hotels occupy two different building parts of the property. The forecasted completion of the construction works is in August 2019 and the latest handover date is agreed with the tenants to be on the 31 December 2019. For our valuation, we have assumed that the construction of the property will be completed in accordance with the time shedule but have added some slack time and assumed that the handover to the tenants will take place on the latest possible date (31/12/2019). In our DCF approach we have projected the future cash flows after the handover of the lease areas. In the first years of the CF (2018 and 2019) the property generates no rental income. First income is assumed to be generated in January 2020. Further, we have deducted the outstanding construction costs in accordance to the provided cost analysis. After its completion, the property will comprise 337 rooms 2-star rooms and 193 4-star rooms.The lease agreements are already signed and will have lease terms of 20 years. In addition, there will be an office area on the 5th floor of the Ramada hotel with approx. 401 sq m. The lease term for the office area is 10 years. We consider the micro location of the property to be excellent for hotel use. Rating (6=top / 1=worst)

Macro loc. 4 Building 6 Overall property rating 5 Micro loc. 6 Cash-flow 5

Main facts

Type of property Hotel Rent passing [Euro p.a.] [future rent] 3,904,072 Year of constr. / last Rent passing [Euro/sq 2019 (expected) 16.42 refurb. m] Lettable area [sq m] 19,814 Market Rent [Euro p.a.] 3,904,072 Anchor tenant H2 Hotel Market Rent [Euro/sq m] 16.42 WAULT [years][starting at Vacancy in % 0.0% 19.41 completion]

Valuation results

Market Value 19,000,000/ Gross Yield on rent 20.5% [Euro]/[RUB} 1,308,469,000 passing Gross Yield on market Capital Value [Euro per room] 20.5% 35,849 rent

Capital Value [Euro per sq m] 959

SWOT

Strengths Weaknesses • Good macro location in a growing city with positive • Above average noise pollution due to the proximity to economic prospects and expanding tourism activity the train station and the bus terminal • Very central location directly adjacent to two major • Leipzig has good development prospects, but ist transportation hubs (main train station and bus terminal) currently economic situation is below average • Excellent location for hotel use • No parking available on site • Good location for office use • Strong local investment climate • In the last 12 months there has been an above average investment activity in the hotel market • Investor's demand for hotel properties has significantly increased during the last 2 years Opportunities Threats • Positive development prospects for Leipzig and forecasted • Longer than expected construction time and delay of population growth (2012 - 2030 +13.9%) handover to the tenants • Rising number of travellers (2011 - 2015 +24%) • Higher than expected construction costs • Possible hold-up of the positive macroeconomic development of Leipzig • relative high hotel development activity in the vicinity (e.g. Premier Inn, Capri, NH) in a radius of 750m

Location description

Macro - location Leipzig is situated in the west of the federal state of Saxony, located some 170km to the southwest of Berlin. The city has approx. 590,000 inhabitants, making it the largest city in the state. Between 2012 and 2017 the population of Leipzig has grown by approx. 12%. A further increase resulting in a population of approx. 600,000 is expected for 2018. The dynamic population growth as well as the good prospects for the city's economy make Leipzig an attractive investment target both for residential as well as commercial real estate developments. The largest employers in Leipzig are VBG (local gas supplier), the University of Leipzig as well as Porsche Leipzig. Due to the proximity to the A19, A14 and A38 motorways, Leipzig is also well connected to the national motorway network.

Micro - location The subject property is located to the east of the main train station of Leipzig right next to the side entrance of the building. The vicinity of the property is characterised by a commercial cityscape. A large newly-built bus terminal and car park, recently developed by the developer of the subject property is located to the north of the property and adjoins the plot of the subject property. The long-distance busses are being served by the adjacent parking building. The property strongly benefits from the proximity to the major transportation hubs. There is also further construction activity in the vicinity of the property. Some 500m to the north of the property a large offices complex of the Deutsche Telekom is being constructed. On the other side of the Brandenburger Strasse there is an A&O Hotel. In addition, some 600m to the southwest of the subject property there is a development of a Capri Hotel (operated by Frasers), which will also be completed in 2019. The propery is also located near the historic centre of Leipzig, which is some 400m to the south of the property. Overall, the location of the property is excellent Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 344

for hotel use.

Property description

At the valuation date, the property was in an early stage of construction. Until the end of December 2017, mainly ground and basement works had been carried out. At the time of the inspection (23/02/2018), works on the ground floor level had also begun and the first staircase cores have already been in place, thus indicating that constructions works are broadly in accordance with the provided time schedule. According to the schedule, the construction works will be completed in July 2019 and the latest handover date to the tenant is the 31/12/2019. In order to reflect possible risks and delays in the construction process, we have assumed that the actual completion of the building will be in late 2019 and that the handover will take place on the 31/12/2019, meaning a start of the lease terms on that date.

Based on the provided information, the property will comprise a budget two star H2 hotel with 337 rooms and a up-scale four star Hyperion hotel with 193 rooms after completion. The building will be a reinforced concrete structure with a curtain wall and a flat roof. The facade will have an integrated isolation and will be partially covered with metal sheets but also comprise a large share of windows surfaces. The northern building section of the property will comprise six floors (incl. GF). The ground floor and the four first upper floors will be occupied by the Hyperion hotel, whereas the fifth floor will be let as an office area. The southern building section will have seven floors, which all are all going to be occupied by the H2 hotel. The two hotels will not be connected to each other regarding their operations but there are going to be connection points between the two building sections in order to create the necessary escape routs. Some of the parts of the buildings are fitted with a sprinkler system. The sprinkler unit itself is located within the technical facilities of the adjacent car park. The subject property itself does not comprise any parking spaces but there is an obligation by the operator of the car park to provide an appropriate amount of parking spaces on market conditions to the tenants of the subject property. According to the provided building and construction description as well as the building rendering, we consider the subject property to be of a good quality and appealing visual appearance.

According to the provided cost schedule the remaining project costs until completion of the property amount to €47,618,519 excl. financing costs which are reflected within the applied discount rate. Depending on the type of costs (e.g. structural measures, out-fitting) we have allocated those costs on Year 1 (2018) and Year 2 (2019) of the cash flow. In addition, we have deducted additional contingencies of 6% in order to reflect possible higher construction costs as well as higher developer's profit expectations.

Property Condition

We have been instructed to undertake an inspection of the construction site. During our visual inspection, we did not note any deficincies in the construction works. The construction works appear to be in line with the provided time schedule. However, we have not checked whether the timeline is met in detail. According to information by the project leader of the development company there have not been any unusual events leading to substantial construction difficulties. We have not undertaken a technical survey of the construction site. Our understanding of the construction process is based on our visual impressions and the information provided during the inspection. In order to reflect possible delays in the construction process, in our valuation approach, we have assumed that the handover of the lease areas to the tenants will be on the latest possible date, on the 31/12/2019. Tenure

The property is freehold. According to the provided land registry of Leipzig dated 15/01/2018, the owner of the property is S&G Development Objekt Leipzig GmbH. The property comprises two parcels (Nr. 3960/12 and Nr. 3918/65) with a total plot size of 5,334 sq m. Further, there is a registered easement in favor of the subject property which allows the use of parking spaces in the adjacent car park to the north of the property. The lease agreements with the tenants of the property state that the owner of the car park has to provide an appropriate amount of parking space on market conditions to the tenants. There is also an encumbrance to the disadvantage of the subject property which foresees that the owner of the subject property has to tolerate immissions caused by the Deutsche Bahn Netz AG (operator of the adjacent train station). A further entry in Section II of the land registry provides the city of Leipzig the right to re-gain ownership of the subject property in case the property is not completed by the end of December 2019.

Occupational Market Comment

Between 2011 and 2015 bed supply in Leipzig rose by some 14% to approx. 12,800 beds. During the same period traveler’s arivalls rose by 24% and overnight stays by 27% in order to arrive at a total of 1.4Mn. Arrivals abd 2.5mn overnight stays. Leipzig has also shown an upward trend in the major hotel KPI's such as average occupancy and daily room rate. In 2015 (latest available data) average room occupancy climbed to 69% and average daily rate rose from €44 in 2011 to €54 in 2015. The hotel market in Leipzig is dominated by 3- and 4-star hotels which account for approx. 91% of the total amount of classified hotels. 67% of the hotels in Leipzig are chain hotels. Regarding the office areas of the subject property, we indicate the rental comparable evidence below.

Lease Comps (offers)

We are not aware of comparable rental evidence for hotel properties in the Leipzig region. We consider the rental level of the signed lease agreements to be typical considering the location and the planned specifications of the property. Following table displays some rental evidence for the office area within the Hyperion hotel. Property Use Lettable area Actual to date Monthly rent per sq Comment m 04103 Leipzig Office 1,730 sq m current offer 10,50 built in 1993 and has sligthly inferior, however slighlty superior location 04103 Leipzig Office 254 sq m current offer 12,00 newly built, similar quality and slightly superior location

Investment Market Comment

In 2017 the transaction volume of hotel properties in Germany amounted to a total of €4.2bn Euros which was some 19% below the 2016 figure but nevertheless the third best result in the last 10 years and also stood above the 5 year average transaction volume. Around 52% of the total investment volume was generated by transactions of 4-star hotels (€2.2bn), followed by 3-star hotels which accounted for approx. 26% (€1.1bn). Looking at the split of the transaction volume by seller, the dominating sellers of hotel properties in Germany in 2017, have been property developers (28%) followed by open-ended real estate funds (18%). In Leipzig, a transaction volume of approx. €100mn has been registered, which is broadly half as much as last year's volume. Regarding gross yields, a further compression down to approx. 4.25% has been registered in top markets like Hamburg and Munich. Due to the lack of product in the established hotel markets, investors will look into investing in secondary markets, a trend which has also been observed in the second half of 2017. The overall investment market prospects for 2018 are positive.

Investment Comps

Property Use Sales date Lettable area Price Gross Yield Comment Deals Capri by Fraser Hotel Q3 2017 9,741 sq m n/a 5.2% Forward deal of 3-star apartment hotel with 151 rooms, completion in Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 346

Property Use Sales date Lettable area Price Gross Yield Comment 2019, centrally located south of the main station Leipzig Motel-One Hotel Q1 2017 n/a 21,000,000 € 4.5% 2-star budget hotel with 194 rooms, constructed in 2009, centrally located in the historic centre of Leipzig 11 hotels - Hotel Q3 2016 n/a 810,000,000 € n/a Portfolio of 11 4- portfolio star hotels with 4,131 units located across the major cities of eastern Germany (e.g. Berlin, Leipzig, Dresden) Maritim Hotel Hotel Q2 2016 25,899 sq m 59,200,000 € 6.8% Large 4-star hotel with 328 units, located in Dresden, north of the historic city centre. Transaction took place in an inferior investment climate

Asset Management Requirements

Since the property is already fully let, we do not see any asset management requirements as of the valuation date. Valuation Assumptions

Rental level / Market Rent According to the most recent hotel study of HypZert from 2012 the average monthly rental levels mainly range between €250 and €420 per room for 2-star hotels and between €450 and €1,200 for 4-star hotels. The rental level of the H2 (560€/sq m) is above the typical range according to HypZert and the rental level of Hyperion (685 €/ sq m) within the indicated range. Given that the last available HypZert publication is from September 2012 and also considering the excellent location of the subject property as well as the expected good building specifications, we consider the current rental level of the two hotels to be on market level. Since the lease agreements for the subject property have all been newly signed and revised though amendments in 2017, we consider the property to be broadly rack-rented.

Re-letting assumptions Given the excellent location of the property for hotel use, as well as the overall good economic development of Leipzig and the growing number of travellers arrivals, we expect the re-letting prospects in case of a future vacancy to be very good. Due to the very central location, we also consider the re-lettability of the office space to be good. A detailed overview of our re-

letting assumptions can be found within the annex "Rent roll & Market leasing assumptions". However due to the length of the defined cash flow period which is shorter than these of the lease agreements, no re-letting costs have been deducted.

Yields Prime net initial yields for newly built hotel properties stand at approx. 4.25% and are achievable for properties in excellent micro-locations of bigger cities. For long-term leased hotel properties in good locations of Leipzig, prime gross yields of around 5.00% can be achieved. In the hypothetical scenario that the property would be completed and generating rental income as at the date of the valuation, we would except a gross yield of 5.4% (18.5 multiple of the gross rental income). For the estimation of the current market value (31/12/2017), we have considered the current construction progress and the remaining time to completion and lease start. We have therefore applied a discount rate of 5.00% and a capitalization rate of 4.90% in order to arrive at a gross yield of approx. 6.06% (16.5 multiple of the gross rental income). The higher gross yield in comparison to the yield (5.4%) in the hypothetical scenario above, reflects the costs, risks and missing rental income until completion. We have then also deducted the outstanding construction costs in accordance to the provided cost schedule incl. an additional deduction of 6% for contingencies.

Sales period Considering the subject property characteristics and the current investment climate in Leipzig as well as the excellent location, we are of the opinion that the saleability of the property after completion will be very good. As of the valuation date and due to the early construction stage and the risk involved with the construction progress, we would expect the investor's interest as of the valuation date to be somewhat limited. Potential buyers are most likely to be regional and national investment companies as well as real estate funds with a focus on hotel properties and foreign investors.

Specific assumptions due to a lack of information

We have not undertaken a technical survey of the construction site and our understanding process is based on the provided documentation, as well as our visual impressions and the information provided during the inspection on the 23/02/2017. We have assumed that the construction works take place in accordance to the provided time shedule and will be completed by the end of July 2019. In order to reflect the risks related to possible delays during the construction, we have added some slack time and assumed that completion will have taken place until the end of 2019 and that the tenant handover will take place by the end of December 2019. Thus, in our DCF approach, the first rental income is generated in January 2020 (two years after the valuation date).

Information provided

• Lease agreement H2 Hotel from 16/06/2015 and lease amendment 14/06/2017 • Lease agreement Ramada Hotel (Hyperion) from 16/06/2015 and lease amendment 14/06/2017 • Lease agreement Dr. Seidemann & Co. Projektentwicklung (office areas), dated 20/12/2016 • Cadastral map, dated 23/05/2017 • Time shedule for construction works, dated 20/09/2017 • Cost schedule for construction works. dated 31/12/2017

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58. Landshut

Asset-ID 58 Country Germany Inspection Address An der Ueberfuehrung 6, 84032 Landshut Simon Volz by Date of valuation 31.12.2017 Date of Inspection 13.02.2018

Overview

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The subject property is a project development of a B&B hotel in a central location of Landshut, north of the city's main train station. Landshut is a medium-sized city with good development prospects, situated some 65km northeast of Munich. The development comprises a two-star budget hotel (B&B) with 84 rooms. The forecasted completion of the construction works is in August 2018 and the latest date for the handover to the tenant on the 31/10/2018. For our valuation, we have assumed that the construction of the property will be completed in accordance with the time shedule but have added some slack time and assumed that the handover to the tenant will take place on the latest possible date (31/10/2018). In our DCF approach we have projected the future cash flows after the handover of the area. Until the 30/10/2018 the property generates no rental income. Further, we have deducted the outstanding construction costs in accordance with the provided cost analysis. After its completion, the property will comprise 84 2-star hotel rooms.The lease agreement is already signed and will have a lease term of 20 years. We consider the micro location of the property to be average for hotel use.

Rating [6=best, 1=worst]

Macro loc. 5 Building 5 Overall property rating 5 Micro loc. 5 Cash-flow 5

Main facts

Type of property Hotel Rent passing [Euro p.a.] [future rent] 297,360 Year of constr. / last Rent passing [Euro/sq 2018 (expected) 11.98 refurb. m] Lettable area [sq m] 2,069 Market Rent [Euro p.a.] 297,360 Anchor tenant B&B Market Rent [Euro/sq m] 11.98 WAULT [years][starting at Vacancy in % 0.0% 20.00 completion]

Valuation results

Market Value 1,400,000/ Gross Yield on rent 21.2% [Euro]/[RUB} 96,414,000 passing Gross Yield on market Capital Value [Euro per room] 21.2% 16,667 rent Capital Value [Euro/sq m] 677

SWOT

Strengths Weaknesses • Good macro location in a medium-sized city with strong • Above average noise pollution due to location at economic indicators and positive prospects highly frequented street and the proximity to the train • Very central location close to the main train station of station Landshut • Landshut is not an established touristic destination, • Very good access to the property by public and private however some hotel chains will soon open their first transport hotels in Landshut (e.g. Ibis) • Investor's demand for hotel properties has significantly • Situated on the northern side of the railway tracks, increased during the last 2 years slightly weaker location as the city centre on the other side of the railway Opportunities Threats • Positive development prospects for Landshut and forecasted • Longer than expected construction time and delay of population growth (2ß12-2030 +9.5%) handover to the tenants • Higher than expected construction costs • Potential hold-up of the positive macroeconomic development of Landshut

Location description

Macro - location Landshut is situated in the east of the federal state of Bavaria located some 65km to the northeast of Munich. The city has approx. 70,000 inhabitants. Landshut is the eleventh largest city in Bavaria and is also the administrative captal of the district Lower Bavaria. According to the Prognos Atlas the future prospects for the city are very good. Further, a slow but stable population growth is expected until 2030. The good prospects for the city's economy and the lack of product in the state's capital, Munich, have drawn the investor's attention to smaller Bavarian cities.In addition to the subject property, an Ibis hotel is currently being constructed and is situated near the main station of Landshut, in a slighlty inferior location. The largest

employers in Landshut are the Deutsche Rentenversicherung (german pension fund), the Lakumed Clinic and the public clinic of Landshut. Due to the proximity to the A92 motorway, Landshut benefits from a good accessibility to the german motorway network and also a good connection to Munich. Many residents of Landshut are commuting to Munich.

Micro - location The subject property is located very closely to Landshut's main train station, some 200m to the northeast. The immediate vicinity of the property is mainly characterised by commercial buildings, incl. a car dealership, a car-repair shop, a fitness studio and some supermarkets. Further to the north, there are residential buildings. The historic centre of Landshut as well as most of the city's attractions are located approx. 1.5km to the south of the subject property on the other side of the railway tracks. The property benefits from the vicinity to the main train station. However the micro location of the property is not best suited for hotel use, mainly due to the lack of leisure and gastronomy possibilites in the immediate vicinity.

Property description

At the valuation date, the property was in an early stage of construction. Until the end of December 2017, mainly ground as well as ground floor works had been carried out. At the time of the inspection (13/02/2018), the construction works had reached the 2rd upper floor, thus indicating that constructions works are broadly in accordance with the provided time shedule. According to the schedule, the construction works will be completed by August 2018 and the latest handover date to the tenant is the 31/10/2018. In order to reflect possible risks and delays in the construction process, we have assumed that the actual completion of the building will be in October 2018 and that the handover will take place on the 31/10/2018, meaning a start of the lease terms on that date.

The property will comprise a budget two star B&B hotel with 84 rooms. The building will be a reinforced concrete structure with a plastered facade. The facade will have an outside isolation. The property will comprise six floors (incl. GF). The property will have no basement. All areas are going to be occupied by B&B. The ground floor consists of common and social areas as well as a residential unit for the hotel manager. The five upper floors comprise 16 to 17 rooms each with a room size of approx. 13 sq m. According to the provided plans, the property will have 22 external parking spaces. Based on the provided construction documentation, we consider the subject property to be of good quality but average visual appearance.

According to the provided cort shedule the remaing project costs until completion of the property amount to €4,385,218 excl. financing costs which are reflected within the applied discount rate. We have deducted those costs in Year 1 of the cash flow.

Property Condition

We have been instructed to undertake an inspection of the construction site. During our visual inspection, we did not note any deficincies in the construction works. The construction works appear to be in line with the provided time shedule. However, we have not checked whether the timeline is met in detail. According to information by the owner, the construction works are in accordance with the provided time shedule. We have not undertaken a technical survey of the construction site. Our undertanding of the construction process is based on our visual impressions during the inspection. In order to reflect possible delays in the construction process, in our valuation approach, we have assumed that the handover of the lease areas to the tenants will be on the latest possible date, on the 31/10/2018.

Tenure

The property is freehold. According to the provided land registry of Landshut, dated 15/01/2018, the owner of the property is Zu Hause auf Zeit Landshut GmbH . The property comprises a single parcel (Nr. 1580/173) with a plot size of 1,195 sq m. There are three encumbrances to the disadvantage of the subject property. One encumbrance foresees that the owner of the subject property has to tolerate immissions caused by the Deutsche Bahn Netz AG (operator of the main train station). Two further encumbrances are in favor of the local energy supplier and a gas supplier (E.ON) and forsee the installation of cabling in the subject plot. We have assumed that the entries in Section II have no detrimental effect on the development and the value of the property.

Occupational Market Comment

In Landshut there are approx. 12 centrally located hotels. Currently there are no 2-star or 5-star hotels in Landshut, meaning that all of the centrally located hotels are 3- or 4-star accommodation facilities. The subject property is going to be the first centrally located 2-star hotel in Landshut. Daily rates for hotel rooms in the above mentioned establishmens range broadly from €80 to €120 per room, which is above average taking into consideration the city's size but is mainly due to the very good economic situation in Landshut. There are no hotels in Landshut that belong to chain hotel companies. B&B and the currently under construction Ibis hotel will be the first chain hotels in Landshut.

Lease Comps

We are not aware of comparable rental evidence for hotel properties in the Landshut region. We have therefore compared rents for hotels in other German cities. We have regard to the following comparable rents:

Location Hotel Rooms Actual to Monthly rent / Comment category date room Dortmund 3* 82 n/a 302 € constructed 1998, location in city centre Merseburg 4* 133 2016 282 € Constructed 1782 (listed building) and 1995, sauna/fitness area, central location, weaker economy

Berlin 4* 176 2016 379 € Constructed: early 1980's, 26 conference rooms, wellness area, decentralised location Berlin n/a 64 n/a 391 € Central location, constructed 1918

Investment Market Comment

In 2017 the transaction volume of hotel properties in Germany amounted to a total of €4.2bn Euros which was some 19% below the 2016 figure but nevertheless the third best result in the last 10 years and also stood above the 5 year average transaction volume. Around 52% of the total investment volume was generated by transactions of 4-star hotels (€2.2bn), followed by 3-star hotels which accounted for approx. 26% (€1.1bn). Looking at the split of the transaction volume by seller, the dominating sellers of hotel properties in Germany in 2017, have been property developers (28%) followed by open-ended real estate funds (18%). Regarding gross yields, a further compression down to approx. 4.25% has been registered in top markets like Hamburg and Munich. Due to the lack of product in the established hotel markets, investors will look into investing in secondary markets, a trend which has also been observed in the second half of 2017. The overall investment market prospects for 2018 are positive.

Investment Comps

Property Use Sales date Rooms Price Gross Yield Comment Deals Ibis Styles Hotel Q4 2017 131 €10,600,000 5.6% constructed Offenbach [€80,916 per 1995, room] refurbished 2015, remaining lease term of around 16.5 years with Fidelis Hospitality GmbH.

Property Use Sales date Rooms Price Gross Yield Comment Sheraton Hotel Q3 2017 170 €17,500,000 n/a constructed in Munich [€102,941 per 1991, in the Airport room] surrounding Hotel of the Munich airport

Innside Hotel Q1 2017 126 €14,400,000 ¨6,5% constructed in Dusseldorf [€114,286 per 2001, district room] location (around 5 km distant to city centre)

NH Hotel Hotel Q1 2017 187 €17,500,000 n/a constructed in Weinheim [€93,583 per 1992, room] refurbished in 2008, agglomeration of Mannheim

Asset Management Requirements

Since the property is already fully let, we do not see any asset management requirements as of the valuation date.

Valuation Assumptions

Rental level / Market Rent According to a hotel study of HypZert from 2012 the average monthly rental levels for 2-star hotels mainly range between €250 and €420 per room. The rental level of the B&B Hotel (295€/room) is at the lower end of the above mentioned range. This is mainly due to the location of the property in a secondary touristic destination, but also due to the small size of the rooms (approx. 13 sq m according to the provided plans). Since the lease agreements for the subject property have all been signed in November 2017, we consider the property to be broadly rack-rented.

Re-letting assumptions Considering the very central location of the property, the overall good economic situation, but also the average touristic activity in Landshut, we expect the re-letting prospects in case of a future vacancy to be average. A detailed overview of our re-letting assumptions can be found within the annex "Rent roll & Market leasing assumptions". However due to the length of the defined cash flow period which is shorter than these of the lease agreements, no re-letting costs have been deducted.

Yields Prime net initial yields for newly built hotel properties in bigger cities stand at approx. 4.25% and are achieved for properties in excellent micro-locations. For long-term leased hotel properties in good secondary locations of Bavaria and with creditworthy tenants, prime gross yields of 5.00% can be achieved. In the hypothetical senario that the property would be completed and generating rental income as at the date of the valuation, we would expect a gross yield of approx. 5.25% (19.0 multiple of the gross rental income), reflecting a capital value of approx. €67,260 per room . For the estimation of the current market value (31/12/2017), we have considered the current construction progress and the remaining time to completion and lease start. We have therefore applied a discount rate of 4.90% and a capitalization rate of 4.50% in order to

arrive at a gross yield of approx. 5.55% (18.0 multiple of the gross rental income). The higher gross yield in comparison to the yield (5.25%) in the hypothetical scenario above, reflects the costs, risks and missing rental income until completion. We have then also deducted the outstanding construction costs in accordance with the provided cost shedule.

Sales period Considering the subject property characteristics and the current investment climate in Bavaria as well as the good location, we are of the opinion that the saleability of the property after completion will be good. As of the valuation date and due to the early construction stage and the risk involved with the construction progress, we would expect the investor's interest as of the valuation date to be somewhat limited. Potential buyers are most likely to be regional investment companies, family offices as well as private investors.

Specific assumptions due to a lack of information

We have not undertaken a technical survey of the construction site and our understanding process is based on the provided documentation, as well as our visual impressions during the inspection on the 13/02/2018 as well as the information provided by phone by the owner/developer. To our understanding, the construction works are taking place in accordance to the provided time shedule and will be completed by the13th August 2018. In order to reflect the risks related to possible delays during the construction, we have added some slack time and assumed that completion will have taken place until the mid of October 2018 and that the tenant handover will take place by the end of October 2018. Thus, in our DCF approach, the first rental income is generated in November 2018 (10 months after the valuation date).

Information provided

• Lease agreement B&B Hotel, dated 10/11/2017 • Land registry of Landshut, dated 15/01/2018 • Cadastral map, dated 16/06/2017 • Building plan, dated 07/06/2017 • Time shedule for construction works, dated 26/10/2017 • Cost schedule for construction works. dated 31/12/2017

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59. Munich

Asset-ID 59 Country Germany Inspection Christoph Address Herzog-Heinrich-Strasse 1, 80332 Munich by Gerlinger Date of valuation 31.12.2017 Date of Inspection 17.01.2018

Overview

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The subject property comprises a six-storey (incl. ground floor and attic) mixed-use building located at the western edge of the inner city area of Munich, approx. 600m south of the main train station of Munich. The property mainly comprises office areas on the ground floor and the four upper floors. Two residential units are situated in the attic of the building (5th floor). The building is detached and was built to high specifications that however are partly outdated today. As at the time of the valuation date, there were only two lease agreements in place which will end shortly after the valuation date (Consulate of Tunisia and one residential unit). Further, some of the areas of the property are owner-occupied (LSR Europe). However, for the valuation purposes and in order to reflect the potential investor's interest, we have assumed that no areas are occupied by LSR and that all the areas of the building will be available for reletting following refurbishment. The office areas account for approx. 79% and the residential units for approx. 9% of the estimated rental value. The re-letting prospects for the office areas as well as the residential untis are very good. Due to the high achievable office rents in Munich and the currently booming occupational and investment market, we consider the saleability of the property to be very good.

Rating

Macro loc. 6 Building 4 Overall property rating 4 Micro loc. 5 Cash-flow 2

Main facts

Type of property Mixed-use Rent passing [Euro p.a.] 94,800 Year of constr. / last Rent passing [Euro/sq 1991 13.22 refurb. m] Lettable area [sq m] 1,429 Market Rent [Euro p.a.] 347,492 Consulate of Market Rent [Euro/sq Anchor tenant 20.26 Tunisia m] Vacancy in % 58.2% WAULT [years] 0.11 Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 358

Valuation results

Market Value Gross Yield on rent 7,000,000/ 1.35% [Euro]/[RUB] passing 482,068,000 Capital Value [Euro/sq Gross Yield on market 4.96% m] 4,899 rent

SWOT

Strengths Weaknesses • Excellent macro location in a economically very powerful • Partially outdated fit-out, tenant improvements are city necessary in order to let the vacant areas on market level • Very good micro location in central district of Munich • Re-letting efforts are required to make the property • Good access to the property by public and private income - producing transport. • High-quality mixed-use building with refurbishment requirement. • Booming office occupational market with record-high take-up volumes • Strong investment climate with high transaction volumes and yield compression Opportunities Threats

• Refurbishment of property and re-letting of the vacant • Longer than expected void periods areas on market level • Higher than expected tenant improvement costs • Fast lease-up of the property is possible due to the • Decline of the currently very high demand for office currently very high demand for office space space • Further positive development of the office investment • Deterioration of the office investment climate market and yield compression • Potentially also conversion to residential space

Location description

Macro - location The property is located in Munich, the capital of the federal state of Bavaria, in Southern Germany. Munich is the capital of Bavaria and has around 1.5 million (as at 31.07.2015) inhabitants, making it the third largest city in Germany after Berlin and Hamburg. Until 2030 a population of 1.723 million is predicted, making Munich one the fastest growing major German cities. Furthermore, the city benefits from its attractive surroundings and its strong economic strength. The economic environment is diversified with all sectors being represented. Six DAX companies (including Siemens, BMW, Allianz) have their headquarters in Munich. Furthermore, Munich is the second largest university city in Germany with approximately 104,000 students.

Micro - location The subject property is located at the western fringe of the city centre in the district Ludwigsvorstadt-Isarvorstadt. It lies at the beginning of the main street "Herzog-Heinrich-Strasse", some 600m south of the main train station of Munich and approx. 1km to the west of the historic old city of Munich. The vicinity of the property is characterised by a mixed-use cityscape, consisting predominately of residential and office buildings. Further, there are many pre-WWII villas present in the immediate vicinity of the property, that have been converted in commercial buildings, now offering upmarket office space for rent. Overall, the location of the property is very well suited both for commercial as well as residential uses.

Property description Valuation report Ň A portfolio of real estate assets in St. Petersburg and Leningradskaya Oblast', Moscow and Moskovskaya Oblast’, Yekaterinburg, Russia and Leipzig, Landshut and Munich, Germany Ň KF Ref: PO-36/2017 Ň Prepared on behalf of LSR Group OJSC Ň Date of issue: March 12, 2018 Page 359

The property comprises a detached 5 storey mixed-use building located on a land plot comprising a site area of 0.08 hectares (800 sqm). The building comprises a Gross Floor Area of 1,445.9 sqm, resulting to a floor to plot area ratio of 1.81. The net area of the property amounts to 1,079 sqm. In Munich it is common that the lettable area is defined as a gross floor area and not a net area. For the matters of our valuation, we have used the gross floor area. The building was constructed in 1991 as a reinforced concrete structure with natural stone facade and tin roof. It has not been modernised since its construction but remains in a good condition, commensurate with its construction year. The attic of the building (5th floor) is being used as residential space and comprises two two-room apartments. The residential untis are connected to the ground floor via the same staircase and elevator as the office spaces. In addition, the office floors are connected with each other via a second internal stairway. Subject to closing the internal stairs, the office areas could be let floor-by-floor to multiple tenants. Due to the skeleton construction concept and thus the lack of load-bearing interior walls, the internal design is flexible. Lastly, the property also has underground parking with a total of 24 parking spaces.

Property Condition

We have been instructed to undertake an inspection. During our visual inspection, we did not note any structural or technical defects. The property is in an overall good condition, commensurate with its construction year. However, in order to re-let the vacant office areas some capital expenditure in form of tenant improvements is required. In our re-letting assumptions in the DCF approach, we have applied tenant improvement costs of €400 per sqm for the office areas and €150 per sqm for the residential untis. Further, according to a provided document, a refurbishment of the building's entrance area is planned, which is budgeted at approx. €115,000. We have deducted this capital expenditure.

Tenure The property is a freehold. According to the provided land registry of Ludwigs-Vorstadt dated 16/01/2018, the owner of the property is LSR Europe GmbH. The property comprises a single parcel (Nr. 9872) with a plot size of 800 sqm. There are no restrictions or encumbrances at the cost of the subject property, mentioned in Section II of the land registry. Occupational Market Comment

In the first three quarters of 2017 (latest available data) take-up in the Munich office market concluded at around 595,000 sq m. This figure is the highest since 2011 and is about 11% higher than the 10-year average. For the entire year 2017, a take- up of around 800,000 sq m is expected. The subject property itself is located between the two real estate submarkets “city centre” and “Middle ring - south”. Rental levels in the city centre range between €23.50 and €36.00 per sqm and in the middle ring - south area between €13.00 and €18.00 per sqm. In the vicinity of the subject property, rental levels between €16.00 and €27.00 can be observed, depending on the building quality. Rents above 24.00 are being achieved in luxurious villas converted into office spaces or in newly constructed upscale office buildings. In similar buildings as the subject property, rental levels range between €18.00 and €20.00 per sqm (net, excl. OPEX).

Lease Comps (offers)

Property Use Lettable area Actual to Monthly rent per sq m (incl. VAT & Comment vacant date OPEX) 80335 Office 361 sq m current 17.00 slightly inferior building Munich offer quality, similar location 80335 Office 253 sq m current 18.00 similar building quality, Munich offer slightly superior location 80335 Office 323 sq m current 16.00 inferior building quality and Munich offer location 80335 Office 276 sq m June 2017 19.00 7 years contract, similar Munich building quality, slightly superior location, munich occupational market has developed positive since the conclusion of this lease

Investment Market Comment

In the first three quarters of 2017 a total transaction volume of €4.04 bn was registered in Munich, meaning a 25% increase in comparison to the previous year’s result. Further, this is the second best result of the past 10 years. More than 50% of the transactions were office properties followed by hotels (22%) and retail properties (11%). Due to the scarcity of office space and strong competition in Munich, the rental levels have increased which has further led to a continuous compression of yields. In Q3 2017 prime net office yields compressed to around 3.1%, which is the lowest level witnessed over the last 10 years.

Investment Comps

Lettable Gross Comment Property Use Sales date Price area Yield Deals Correo Office Q1 2018 44,999 sq 278,000,000 € n/a Large offices Quartier m complex, built in 1992, inferior quality, superior location, redevelopment is planned Gabrielen- Office Q3 2017 7,365 sq m 53,500,000 € 4.0% Redeveloped in Lofts Q4 2017 and is of higher quality, fully pre-let at time of transaction. Superior location. Arnulfpark, Office Q3 2017 7,400 sq m 57,700,000 € 3.9% Higher building Munich quality, redeveloped office property, inferior location North Office Q2 2017 9,144 sq m 50,000,000 € 3.9% Constructed in Munich 2004 and fully let, inferior location, Wault 6.6 years North city Office Q4 2016 21,000 sq 102,400,000 € 4.2% Newly built fringe m office building, better building quality, inferior location at outer city area Theresien- Office Q4 2016 11,400 sq 42,300,000 € 4.9% Constructed in wiese, m 2002, similar Munich location. However, weaker transaction in an inferior investment climate

Asset Management Requirements

During our inspection on the 17/01/2018, we have been informed that the Consulate of Tunisia will leave their lease unit on the 31/01/2018. The rest of the office areas are vacant or are being used by the property owner LSR Europe GmbH. Further, we were informed that the tenant of a residential unit on the 5th floor will vacate on 30/04/2018. The other residential unit is already vacant. Following, these two tenant move-outs, there is a prospective refurbishment and re-letting of the property planned. Therefore, in our valuation we have deducted the necessary costs, such as tenant improvements, agent fees and void costs until the re-letting.

Valuation Assumptions Rental level / Market Rent The rent currently paid by the Consulate of Tunesia is approx.. -10% below the estimated rental value for the office areas of the subject property. Following a refurbishment of the subject property and renovation of the office lease units, we would expect an ERV of €19.00 per sqm. The leased residential unit on the 5th floor is also considerably under-rented (25% below the ERV). Following some renovation measures, we estimate the ERV of the two residential units to stand at €18.00 per sqm.

Re-letting assumptions Given the good condition, specification and location of the building, as well as the record high office take-up volume in Munich, we expect a high demand for the office areas and very good re-letting prospects. As mentioned in the report sections above, some re-letting costs and rental incentives will be necessary in order to re-let the vacant areas. A detailed overview of our re-letting assumptions can be found within the annex "Rent roll & Market leasing assumptions".

Yields Prime net initial yields for newly built office buildings in top locations of Munich stand at 3.1%. Considering the older construction year of the subject property, the very central but not prime location as well as possible risks connected with the refurbishment and re-letting of the areas, we would expect the property to transact at a net yield (Potential Rental Income / Gross Market Value) of approx.. 4.5%. In our DCF calculation approach, we have applied a capitalization rate of 3.50% and a discount rate of 4.00% in order to arrive at a gross yield on market rent (=potential rental income) of 4.96% and a net yield of 4.64%.

Sales period Considering the subject property characteristics and the current investment climate in Munich, we are of the opinion that the saleability of the property is very good and that a marketing period of 3 to 6 months would be sufficient. Potential buyers are most likely to be regional investment companies, family offices as well as private investors.

Specific assumptions due to a lack of information

During our inspection, we have been informed that the owner of the property is taking into consideration several redevelopment concepts that include the scenario of a building conversion into a residential building or a refurbishment of the property and re-letting as office space. We are also aware that the owner would like to use the office spaces on the 3rd and 4th floor for its own purposes.

Since none of the plans is finalized, we have adopted the most likely scenario, which is the refurbishment of the building and lease-up. Further, in our valuation, we have assumed that if the property was to be sold to an investor, the current owner would lease the required areas on market level (sale-and-lease back deal). Information provided

• Lease agreement Consulate of Tunesia, dated 18/12/2012 • Land registry excerpt, dated 16/01/2018 • Cadastral map, dated 11/07/2016 • Floor area measurement dated 22/11/1988 • Floor plans, dated 04/08/1989 • Cost schedule, entrance area, dated 18/10/2016

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