Annual Financial Report 2020 REGULATED INFORMATION Published on 23 April 2021 before trading hours ANNUAL FINANCIAL REPORT for the period from 1 January 2020 to 31 December 2020 AUDITED Care Property Invest declares that: the 2020 Annual Financial Report has been filed as a Universal Registration Document with the FSMA on the date of 23 April 2021, as the competent authority under Regulation (EU) 2017/1129 without prior approval under Article 9 of Regulation (EU) 2017/1129; the Universal Registration Document may be used for an offer of securities to the public or the admission of securities to trading on a regulated market, provided that it has been approved by the FSMA, together with any amendments and a securities note and summary approved in accordance with Regulation (EU) 2017/1129. The information made available via the website does not form part of this Universal Registration Document unless that information is incorporated by reference. The Dutch version as well as the French and English version of this annual financial report are legally binding. Within the framework of their contractual relationship with the Company, investors can therefore always appeal to the translated versions. Care In 2020 the hard work of the Company’s employees was Property invest, represented by its responsible people, is responsible for the translation and conformity of the Dutch, French and English language versions. However, in case of discrepancies between language versions, the Dutch version always prevails. rewarded with 14 new investments. In 2019 the hard work of the Company’s employees was rewarded with 10 new investments. 4 | Care Property Invest NV/SA Annual Financial Report 2020 Annual Financial Report 2020 Care Property Invest NV/SA | 5 Table of contents I. Risk factors 8 VII. Financial statements 158 1. Operational risks 10 1. Consolidated financial statements as at 31 December 2020 160 2. Financial risks 14 2. Notes to the consolidated financial statements 166 3. Regulatory and other risks 19 3. Auditor’s report 214 II. Letter to the shareholders 24 4. Abridged statutory financial statements as at 31 December 2020 219 III. Report of the Board of Directors 32 VIII. Permanent document 230 1. Strategy: Care building in complete confidence 32 1. General information 230 2. Important events 40 2. Information likely to affect any public takeover bid 238 3. Synthesis of the consolidated balance sheet and the global result statement 59 3. Declarations (Annex I to Regulation (EU) No. 2019/980) 241 4. Appropriation of the result 67 4. Other declarations 242 5. Outlook 68 5. History of the Company and its share capital 243 6. Main risks and insecurities 72 6. Coordinated Articles of Association 245 7. Research and development 72 7. The public regulated real estate company (RREC) 253 8. Capital increases within the context of authorised capital 72 IX. Glossary 262 9. Treasury shares 72 1. Definitions 262 10. Internal organisation and functioning of Care Property Invest 74 2. Abbreviations 271 11. Corporate Governance Statement 77 IV. Care Property Invest on the stock market 116 1. Stock price and volume 116 2. Dividends policy 118 3. Bonds and short-term debt securities 119 4. Shareholding structure 120 5. Financial calendar 121 V. EPRA 124 1. EPRA (European Public Real Estate Association) - Membership 124 VI. Real estate report 136 1. Status of the property market in which the Company operates 136 2. Analysis of the full consolidated property portfolio 142 3. Summary tables consolidated property portfolio 147 4. Report of the real estate expert 153 I. Risk factors 8 | Care Property Invest NV/SA Risk factors Risk factors Care Property Invest NV/SA | 9 I. Risk factors The strategy of Care Property Invest is aimed at creating stability for the investors, in terms of both Impact of the coronavirus outbreak dividends and income in the long term. The COVID-19 outbreak in early 2020 and the associated measures to control the spread of the virus did not The Executive Committee and the Board of Directors are aware of the specific risks associated with the have a significant impact on the financial performance in 2020. management of the Care Property Invest property portfolio and aim for optimal management of these and For 2021, the Company has a solid basis in terms of liquidity and debt ratio. The contribution in kind of the to limit them as far as possible. The list of risks which are described in this section is not exhaustive. Most ‘Résidence des Ardennes’ project in Attert and the increase of the MTN programme to €300 million at the of these factors relate to uncertain events that could occur. beginning of 2021 further strengthen the Company’s position. Nevertheless, developments in the sector In the context of the ESMA guidelines on risk factors under the Prospectus Regulation, the Company(1) and among tenants are closely monitored, as well as the broader impact of the COVID-19 crisis and the has, on the one hand, limited itself to those risk factors that apply specifically to it and therefore not to the measures and vaccination strategy. In the longer term, the demand for healthcare real estate driven by entire real estate sector, RREC sector or all listed companies and, on the other hand, to those that are also demographic evolutions remains unaffected by the COVID-19 crisis. This crisis has only underlined the material. importance of providing proper care for the elderly. General, non-material or other unknown or improbable risks or risks which, on the basis of the information currently available, are not assumed to have an adverse effect on the Company or on its activities or financial situation, may exist. Care Property Invest is of the opinion that the factors described below reflect the main risks currently associated with the Company and its activities. The order in which the risk factors are listed is an indication of the importance, per category (in relation to the probability that they will occur and the expected scale of the adverse effect) of the risk factors. It should also be noted that risk management is not an exercise only conducted at certain intervals, but an integral part of the way in which Care Property Invest is run on a daily basis. The main risk factors that Care Property Invest faces are the subject of regular and daily monitoring by the Risk Manager, the Effective Leaders and the Board of Directors, who have defined a prudent policy in this respect, which they will update regularly if necessary. This ranges from daily financial and operational management, analysis of new investment projects and formulating the strategy and objectives to laying down strict procedures for decision-making. Understanding and protecting against/eliminating risks arising from both internal and external factors is essential in order to achieve a stable total return in the long term. In 2019, the Company decided to set up an Audit Committee. This Audit Committee’s task in relation to risk management is to monitor the efficiency of the Company’s risk management systems. (1) The term ‘Company’ refers in this annual financial report to: Care Property Invest nv. 10 | Care Property Invest NV/SA Risk factors Risk factors Care Property Invest NV/SA | 11 1. Operational risks 1.2 Risks associated with the concentration risk 1.2.1. DESCRIPTION OF THE RISK 1.1 Risks associated with the solvency of lessees This risk can be described as the risk of concentration of lessees or investments in one or more buildings 1.1.1. DESCRIPTION OF THE RISK in relation to the overall real estate portfolio. This risk can be described as the risk of (partial) default or mandatory liquidation of tenants, lessees and In accordance with the RREC legislation the Company is required to limit these risks and to spread its long-term leaseholders. risks by respecting a diversification of its real estate on the geographical level, per type of property and per 1.1.2. POTENTIAL IMPACT FOR THE COMPANY lessee. Article 30 of the RREC legislation provides that ‘no action performed by the Public RREC may result The potential impact concerns a sudden, unexpected diminution in rental income due to a deterioration in (1°) more than 20% of its consolidated assets being invested in real estate forming a single real estate in the debt collection rate or a fall in the occupancy rate, as well as rising commercial costs for re-letting unit; or (2°) this percentage increasing further if it already amounts to more than 20%, regardless of the if the insolvency of tenants leads to voids. There is a risk that if the relevant tenants, lessees or long-term cause, in the latter case, of the original overrun of this percentage. This restriction applies at the time of the leaseholders remain in default, the surety will not suffice and the Company will consequently bear the risk action concerned’. If the Company exceeds the 20% diversification rule, it may not make any investments, of being unable to recuperate sufficient amounts, if any. This all has an impact on the profitability of the divestments or take other actions that could result in a further overrun of this percentage. In other words, Company and the capacity to distribute dividends or at least to maintain the level of these. this limits the possibilities of the Company in relation to additional investments or divestments. The reason for this is that excessive exposure to an operating lessee also entails excessive exposure to the risk The Company assesses the probability of this intrinsic risk as average and its potential impact as average. of that lessee’s insolvency (see ‘‘1.1 Risks associated with the solvency of lessees’ on page 10).