CS EUROREAL Open-Ended Real Estate Fund Compliant

Note CREDIT SUISSE ASSET MANAGEMENT Immobilien Kapitalanlagegesellschaft mbH gave irrevocable notice to terminate the management of the CS EUROREAL fund on 21 May 2012 to take effect on 30 April 2017 and also declared that it had permanently stopped the issue and the redemption of units of the CS EUROREAL fund. This meant that any received buy and sell orders would no longer be performed. This report is not provided for the purchase of Fund units on the secondary market.

CS EUROREAL Open-ended Real Estate Fund Compliant with German Investment Act Non-Binding Translation of the Annual Report as at 30 September 2016 Brief Summary of CS EUROREAL

Key Figures as at 30.09.2016 WKN 980 500 WKN 975 140 Fund in EUR in CHF in EUR Fund‘s net assets (in million) 2,054.4 141.6 2,185.2 Total gross real estate assets (market value (book value for projects) in million EUR) 1,876.4 thereof directly held (in million EUR) 1,231.1 thereof held via property companies (in million EUR) 645.3 Total number of properties held by the Fund 32 thereof via property companies (number) 6 Letting level (in %) 85.5 Interim distribution per unit for the financial year 2015/2016 as at 26 July 2016 3.00 3.50 Year-end dividend per unit for the financial year 2015/2016 0.00 0.00

(Reinvestment at the end of the financial year as at 30 September 2016) Investment performance (1-year comparison) in %1,2 0.5 -0.3 Unit value/Redemption price 20.89 32.54

Change during reporting period WKN 980 500 WKN 975 140 Fund 01.10.2015 – 30.09.2016 in EUR in CHF in EUR Number of properties purchased 0 thereof directly held (number) 0 thereof held via property companies (number) 0 Number of properties sold 14 thereof directly held (number) 14 thereof held via property companies (number) 0 Unit sales (number) 0 0 0 Unit redemptions (number) 0 0 0 Net fund inflow (number) 0 0 0 Net inflow of funds (in million) 0.0 0.0 0.0

Fund launch date: 6 April 1992

CS EUROREAL EUR Securities Identification Number (Germany): 980 500 International Securities Identification Number: DE0009805002 Securities Identification Number (Switzerland): 327 344

CS EUROREAL CHF Securities Identification Number (Germany): 975 140 International Securities Identification Number: DE0009751404 Securities Identification Number (Switzerland): 2 248 222 Since 1 October 2005

Cover photo: Lisbon (Portugal), Avenida Dom João II Iote 1.18, ‚Art‘s Building‘ CS EUROREAL Annual Report as at 30 September 2016

4 Report by Fund 82 List of Purchases Management and Sales

44 Overview: Yields, 86 Income Statement Valuation, Letting 88 Notes to the 50 Consolidated Income Statement Statement of the Fund’s Assets 90 Use of Funds Statement 56 Statement of the Fund’s Assets Part I 92 Development of the List of Properties – Fund’s Assets Location of property, useable floor space and values according to valuer 95 Notes to Development of the Fund’s Assets 66 Statement of the Fund’s Assets Part I 96 Development of List of Properties – CS EUROREAL Letting Information and Multiple year overview Incidental Purchase Costs 97 Development 76 Statement of the of the Yields Fund’s Assets Part II Multiple year overview Portfolio of the money market instruments, investment units, securities and cash at bank 99 Special Auditor’s Note

78 Statement of the 100 Tax Information Fund’s Assets Part III Other assets, liabilities, hedging 142 Management, Bodies transactions and provisions, and Sales Associates additional notes

Contents 3 Report by Fund Management

Dear Investor, paid on a half-yearly basis subject to available liquidity. An interim dividend payment in June/July was made in previous On the following pages of this Annual Report we inform you years in addition to the normal dividend payment in December/ about the progress and important results of the financial year January. Additional interim dividend payments can also be 2015/2016 of the CS EUROREAL fund, from 1 October made at other times, particularly in the case of a successful 2015 to 30 September 2016, and the important events and sale of a large number of properties or a high sales volume. risks and key figures of the Fund in the reporting period or as The repayment of the surplus liquidity in the form of dividends at the reporting date. The Report particularly includes informa- will ensure the equal treatment of all investors and that all held tion on the progress of the Fund’s liquidation together with the units are allocated the same amount per unit. In the case of status of the property sales, mortgage repayments, dividend units held in a securities account at a bank, the dividends will payments and the value development of the Fund. be paid via that bank.

The CS EUROREAL fund has been in the process of liquida- The dividends always consist of both accumulated surplus tion since 21 May 2012. We, CREDIT SUISSE ASSET funds from the Fund‘s continuing income, e.g. from rent MANAGEMENT Immobilien Kapitalanlagegesellschaft mbH, payments by the tenants of the Fund‘s properties and interest (CSAM) will continue to manage the Fund on a trustee basis in on the liquid investments of the Fund (cash at bank and fixed- our capacity as Capital Investment/Asset Management term deposits) and repayments of the investment capital (e.g. Company and be responsible for the proper further management proceeds from property sales) to the investors. It should be of the Fund and for the sale of the properties of the Fund until noted that not all the proceeds from property sales can be the expiry of our management mandate on 30 April 2017. used for dividends/capital repayments because a liquidity Both the issue and redemption of units of the CS EUROREAL deduction must be made for the continued proper management fund were finally stopped when the liquidation of the Fund was of the Fund. These liquid funds are necessary for the payment initiated. This means that redemption of units at the Capital of the Fund‘s future expenses and debts and to ensure Investment/Asset Management Company or the Custodian adequate risk provisions. Adequate liquid funds are needed not Bank of the CS EUROREAL fund, i.e. Commerzbank AG, by only for the management of the Fund‘s remaining properties, the investors has not been possible since that point in time in other assets and liabilities but also for the continued proper order to ensure an equal treatment of all investors. management of the Fund for the already completed sale of properties and, for the remaining unsold properties, for example, During the liquidation phase, the investors will receive surplus for letting, maintenance and conversion measures to retain or money of the Fund, which is not needed for the proper increase their attractiveness and to achieve the best possible management of the Fund or the scheduled repayment of selling price. A reasonable liquidity level is also required because loans, in the form of asset distributions. These dividends will be some payment obligations resulting from the completed sale of

4 Report by Fund Management properties such as tax on gains on sale of foreign properties, transition of the CS EUROREAL fund to the Custodian Bank any potential warranty claims or any guarantees given for rent and the ever-decreasing number of portfolio properties. The and construction costs within the scope of such sales are often remaining liquidity after deduction of the risk provisions for incurred long after the signing of the contract of sale and the contingent liabilities including a risk buffer is needed to cover final amount of all involved payments can only be determined future expenses and liabilities that are expected from today‘s long after the sale. It should also be noted that the Fund point of view. These particularly include construction and letting generates increasingly less rental income because of the measures aimed at retaining or increasing the value of the progressing property sales. A reasonable liquidity level thus remaining Fund‘s properties and liabilities resulting from ensures the continued proper management of the Fund for the property sales such as tax on gains on sale abroad, warranty benefit of the investors. The liquid funds of the Fund were claims or guarantees given within the scope of the property EUR 294.2 million (13.5 % of the Fund‘s net assets) as at sales. After expiry of, for example, relevant limitation periods 30 September 2016. (e.g. statutory limitation periods) or final confirmations (e.g. tax audits) for the individual assets, it will be possible again to As at 30 September 2016, nine dividend payments have gradually reduce contingent liabilities including those not stated already been made since the start of the liquidation of the in the balance sheet and to distribute the no longer required CS EUROREAL fund on 21 May 2012. liquid funds.

The ninth dividend payment since the initiation of the liquidation A few contracts for property sales could be concluded shortly of the CS EUROREAL fund and the first dividend payment for after the end of the reporting period and the resolution on the the financial year 2015/2016, which is called an interim determination of the year-end dividend (see ‚Property Portfolio payment, took place on 26 July 2016. It amounted to Management‘ on pages 20 to 22 of this Annual Report) and EUR 3.00 per unit for the EUR unit class of the CS EUROREAL we expect to receive the major part of the respective purchase fund and CHF 3.50 per unit for the CHF unit class of the price by April 2017. We also expect that further property sales Fund. will be concluded before the end of our management mandate on 30 April 2017. From today‘s point of view, an extraordinary A resolution for reinvestment at the end of the year on interim distribution of the then available liquid funds is envisaged. 30 September 2016 instead of the payment of a year-end dividend was passed by Fund Management for the financial A total amount of EUR 3,185.3 million or EUR 30.60 per unit year 2015/2016. The available liquid funds reduced to a level for the EUR unit class and CHF 46.20 per unit for the CHF that did not allow any year-end dividend for the financial year unit class has already been distributed or repaid since the start 2015/2016 particularly because adequate risk provisions for of the liquidation of the CS EUROREAL fund. contingent liabilities had to be made in view of the pending

Report by Fund Management 5 Overview of the dividends / reinvestments of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Date Financial year Distribution Distribution Total dividend Number of the Fund CS EUROREAL CS EUROREAL payment in EUR unit class CHF unit class million euros3 in EUR per unit in CHF per unit 1 3 July 2012 2011/2012 4.30 6.70 447.1 2 11 December 2012 2011/2012 4.40 6.80 457.2 3 18 June 2013 2012/2013 1.05 1.65 109.1 4 10 December 2013 2012/2013 2.00 3.10 207.7 5 29 July 2014 2013/2014 5.00 7.80 519.7 6 27 January 2015 2013/2014 4.25 6.65 445.9 7 28 July 2015 2014/2015 4.80 7.25 501.6 8 26 January 2016 2014/2015 1.80 2.75 187.9 9 26 July 2016 2015/2016 3.00 3.50 309.1 10 30 September 20164 2015/2016 0.00 0.00 0.0 Total 30.60 46.20 3,185.3

3 The dividend payments of the CHF unit class of the CS EUROREAL fund were converted to euros at the exchange rate applicable on the respective distribution date. 4 A reinvestment of the year-end dividend was made for the financial year 2015/2016 of the CS EUROREAL fund as at the end of the financial year on 30 September 2016.

One of our main objectives since the initiation of the liquidation from the European Union. But there are current signs that the of the Fund is to increase the liquidity of the Fund through the economic recovery slowdown might be less serious than previ- sale of further properties from the portfolio of the CS EUROREAL ously feared and will go on for some years. Economic recovery fund and to pay out the surplus liquidity to the investors as in Europe is therefore likely to continue, with Spain being the soon as possible. However, it should be noted that Fund most dynamic and Italy being the least dynamic of the four Management will not only take the time aspect into account for largest national economies. The inflationary pressure will the property sales, the main objective is to achieve reasonable probably remain subdued due to the continued large production selling prices for the benefit of the investors. output gaps, especially in the periphery and the pressure on the European Central Bank to maintain its expansive monetary The economic outlook in Europe is moderately positive. policy will therefore hardly reduce. Positive impacts in Europe Forecasts have however recently been slightly reduced against are based on growth in the retail trade and the construction the backdrop of the weaker growth dynamism in China, the industry whilst the investment weakness continues. The positive political uncertainty and the Brexit debate. There are particularly mood change among the companies confirms that moderate economic concerns about a potential exit of the United Kingdom growth rates can still be expected despite adverse conditions.

6 Report by Fund Management The recovery in the commercial property markets has generally achieved for the first time in Germany in the third quarter of continued and the positive development of fundamental data, 2016, whereas Great Britain showed substantial reductions for example, an increasing demand for space, a reducing during the third quarter and overall since the beginning of the vacancy level and few new building projects, predominantly year. ensure strong rental income growth. In London however, rental space sales reduced to the level prevailing during the global There is an increased interest in properties outside the prime financial crisis. Furthermore initial property price reductions in segment. Secondary markets in Germany, The Netherlands the second and third quarter of 2016 must be interpreted as and Great Britain also benefit from a higher demand. Further- warning signs of an at least short-term trend turnaround. more, the transaction volume over the year showed high growth rates in Sweden (+11 %), in The Netherlands (+10 %) Monetary policy continues to support investments in European and in Spain (+6 %). Institutional investors kept a low profile in commercial properties and the key interest rate reduction by Great Britain because of the high price level and the rising the European Central Bank in March 2016 ensured a continu- uncertainty about the consequences of the Brexit Referendum, ing attractive yield difference to government bonds so that the whereas the low transaction volume in Germany was mainly low bond yields result in a generally high interest in property due to a very limited offer. A cyclic trend weakening in the investments. medium term can be seen, particularly in the high-price segments of the property investment market. Price reductions However, analyses of the first three quarters of the year 2016 in London were already reported in the second and third quarter show that a lower transaction volume must be expected for the of 2016. entire year of 2016 compared to 2015. The reduction in Great Britain was mainly due to increased uncertainty and the reduc- Signs of recovery in the property market have been evident tion in Germany was mainly due to the lower product availability. since 2014 after the economic downturn phase in the Euro The markets in Southern Europe, The Netherlands and Poland region in 2012 and 2013. For example, office space lettings however show a positive transaction volume trend. European have increased at the 36 most important office locations since office properties were much sought after by investors in the 2014. This development continued in 2016 during which the last few years and that caused a strong decrease in the initial rental space lettings increased again by 15 % compared to the yields on an international scale. The average yield in the third first six months of the previous year. The only negative excep- quarter of 2016 reached 4.41 % and is thus lower than the tion is London with a reduction in rental space lettings of about previous all-time low of 4.64 % in the boom year of 2007. 25 % in the first six months of 2016 compared to the first six months of the previous year. The transaction volume for commercial properties totalled about EUR 285 billion in 2015. About EUR 163 billion were The expectations of rental income growth now appear to slowly achieved in the first three quarters of 2016 – a reduction of materialise. Many European office markets have only recently about 29 % compared to the same period in the previous year. come out of the recession and therefore still have catch-up The highest sales volume in the transaction market was potential. Rents further increased in 28 out of the 40 most

Report by Fund Management 7 important markets by the end of the first half-year of 2016 The weak inflation and the associated pressure on profit compared to the previous year. The growth speed accelerated margins remain problematic for the entire retail trade so that by a moderate 2.6 % p.a. Growth was particularly strong in cost reduction often has a priority for the companies and the Berlin, Dublin, Madrid and Barcelona. Only three cities showed expansion of the branch network lost dynamism. The analysis a moderately falling rent level. Furthermore, vacancy levels and assessment of investments in terms of demographic reduced in 30 of the 40 markets so that a successive and dynamism, the development of real wages, the prevailing widespread improvement in fundamental data can be seen. consumption patterns, consumer preferences and competitiveness against e-commerce increasingly gain importance in a The positive trend in fundamental data is reflected by higher fiercely competitive environment. sales generated by tenants in the shopping centres that were able to reverse the negative trend of 2014. Accordingly, the The selling process was pushed on in the course of the further shopping centre segment showed further reducing vacancy improvement in the property markets that manifested itself in a levels and the rental income development has been positive growing transaction volume. 14 property sales for a total of again since 2015. The situation was even better in the central about EUR 420 million could be concluded during the financial shopping malls of Europe. An increasing number of markets year 2015/2016 of the CS EUROREAL fund. The majority of showed a rental income growth. 23 markets of the 27 most the Dutch property portfolio of the CS EUROREAL fund was important retail property markets in Europe had a higher rental sold. Due to the starting economic and property market income level as at the end of the first half-year of 2016 com- recovery in The Netherlands, investors have increasingly pared to the same period in the previous year, three markets sought Dutch properties again since last year. The improved had a stable rental income level and only one market had a market situation was exploited to sell nine of the eleven Dutch lower rental income level. At the same time, rental income properties of the CS EUROREAL fund. Together with the five growth was on average 3.6 % and therefore higher than in Dutch properties held by the CS PROPERTY DYNAMIC fund, 2015 (3.4 %). which aims at institutional investors and is also managed by us,

8 Report by Fund Management the package included a total of 14 properties. A purchase price You will find detailed information on the 14 property sales in confidentiality agreement was signed. The sum of the market the financial year 2015/2016 of the CS EUROREAL fund values of the nine predominantly smaller properties of the under the ‚Property Portfolio Management‘ heading on pages CS EUROREAL fund was EUR 300.2 million. The portfolio, 20 to 22 and in the ‚List of Purchases and Sales to the State- well balanced in terms of location and quality, included six ment of the Fund‘s Assets as at 30 September 2016‘ over- office properties, two properties with mixed office and retail view on pages 82 to 84. use and one logistics property. The properties are situated at four locations (The Hague, Rotterdam, Utrecht and the A total of 67 properties were sold for about EUR 3.2 billion in Amsterdam area). The Fund now has only two remaining office the period from the start of the Fund’s liquidation to the report- properties with a total value of currently EUR 182.8 million in ing date 30 September 2016 and a total of 82 properties have The Netherlands (Bijlmerdreef 24-74 in Amsterdam and Borde already been sold for about EUR 4.6 billion since the beginning wijkstraat 10 in The Hague-Rijswijk). Five further property of the redemption suspension of the CS EUROREAL fund on sales could also be concluded. These are the office properties 19 May 2010. This corresponds to about 71 % of the current at 400 Promenade des Anglais in Nice (France), at 80 Bath property assets including the previous sales proceeds. The sell- Street in Glasgow (Great Britain), Kennedyallee 87 in Frankfurt ing prices of the 14 properties sold in the financial year 2015/ am Main (Germany) and the DIY centres at Grossbeerenstrasse 2016 were on average above the market values last 119 -159 in Berlin-Mariendorf and Europaallee/Magazinstrasse ascertained by the independent valuers. The sales proceeds 90 in Fürth (Germany). The two DIY centres in Berlin and received on average since the redemption suspension corre- Fürth were successfully sold after the lease with the operating sponded more or less to the last determined market values. company had been extended on a long-term basis. The selling price for the five properties was above the market value of EUR 85.0 million last determined by the independent valuers.

Report by Fund Management 9 Overview of the property sales from the portfolio of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Transfer of Financial Country Town Building name, Building type number benefits and year address burdens of the Fund 1 July 2012 2011/2012 Germany Saarbrucken ‚Europa-Galerie‘, shopping St. Johanner Strasse / centre Trierer Strasse / Reichsstrasse 1 2 December 2012 2012/2013 France Paris ‚Le Sequana‘, office building 83-93 Quai Panhard et Levassor / 1-5 Rue Neuve Tolbiac 3 January 2013 2012/2013 Germany Wiesbaden ‚Mauritiushaus‘, retail property Mauritiusplatz 2 / Schulgasse 5 / Kleine Kirchgasse 2-4 4 July 2013 2012/2013 Sweden Stockholm ‚Västerport‘, office building (Kungsholmen) Warfvinges Väg 37-41 5 September 2013 2012/2013 Great Britain Edinburgh ‚Lochrin Square‘, office building 92-98 Fountainbridge 6 September 2013 2013/2014 Belgium Brussels ‚Centre Botanique‘, office and Boulevard du Jardin retail property Botanique 13a 7 October 2013 2013/2014 Great Britain Newcastle Gallowgate 30/34 office building 8 November 2013 2013/2014 France Lyon ‚Quatuor‘, office building Avenue Tony Garnier 12-14 (C) and 16-18 (D) 9 December 2013 2013/2014 Sweden Gothenburg ‚Hasselbladhuset‘, office building Sankt Eriksgatan 5 10 March 2014 2013/2014 Great Britain London ‚Corn Exchange‘, office building 55 Mark Lane 11 March 2014 2013/2014 Germany Hanover- Münchner Strasse logistics Langenhagen 52 and 54 building 12 March 2014 2013/2014 Germany Bremen Ludwig-von-Kapff- logistics Strasse 1 building 13 March 2014 2013/2014 Germany Biebesheim Eduard-Fresenius- logistics Strasse 1 building

10 Report by Fund Management Overview of the property sales from the portfolio of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Transfer of Financial Country Town Building name, Building type number benefits and year address burdens of the Fund 14 March 2014 2013/2014 Germany Frankfurt Weserstrasse 31-33 residential am Main building 15 May 2014 2013/2014 Germany Stuttgart Kronprinzstrasse 6 office and retail property 16 July 2014 2013/2014 Great Britain London 60 Great Tower Street/ office building 2 Plantation Place South 17 July 2014 2013/2014 Germany Hamburg Dammtorstrasse 1 office building 18 August 2014 2013/2014 Germany Frankfurt Bockenheimer office building am Main Landstrasse 72 19 October 2014 2014/2015 Germany Munich Bahnhofplatz 1 office and retail property 20 October 2014 2014/2015 France Boulogne 24, 26 Quai Alphonse office building (Paris region) le Gallo 21 November 2014 2014/2015 Germany Berlin Ernst-Reuter-Platz 3-5 office building 22 December 2014 2014/2015 Germany Berlin Reinhardtstrasse 32 office building 23 December 2014 2014/2015 Spain Barcelona Avenida Diagonal office building 197-199 24 December 2014 2014/2015 Spain Madrid Calle Via de los office building Poblados 3 25 December 2014 2014/2015 Spain Madrid Ribera del Loira 28 office building 26 December 2014 2014/2015 Spain Tarragona Poligono Industrial retail property ‚Les Gavarres‘ (DIY Centre) 27 December 2014 2014/2015 France Issy-les 1-3 Rue du Passeur de office building Moulineaux Boulogne (Paris region) 28 January 2015 2014/2015 Germany Berlin Charlottenstrasse 68 office building 29 January 2015 2014/2015 Great Britain Manchester 3 Hardman Square office building 30 February 2015 2014/2015 Germany Berlin Schillerstrasse 3 office building

Report by Fund Management 11 Overview of the property sales from the portfolio of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Transfer of Financial Country Town Building name, Building type number benefits and year address burdens of the Fund 31 February 2015 2014/2015 Germany Hamburg Millerntorplatz 1 office building 32 March 2015 2014/2015 Great Britain Glasgow ‚Aurora‘, office building 120 Bothwellstreet 33 May 2015 2014/2015 Germany Berlin ‚City Light House‘, office and Kantstrasse 162/Joa- retail property chimstaler Strasse 41 34 May 2015 2014/2015 Germany Berlin Schellingstrasse 1 office building 35 May 2015 2014/2015 Germany Berlin ‚Shell-Haus‘, office building Reichpietschufer 60-62 36 May 2015 2014/2015 Germany Hamburg ‚HTC‘, office building Am Sandtorkai 74-77 37 May 2015 2014/2015 Germany Hamburg Lübeckertordamm 5/ office building Philipsstrasse 14 38 May 2015 2014/2015 Germany Hamburg Bertrand-Russel- office building Strasse 3 and 5/ Max-Born-Strasse 2 and 4 39 May 2015 2014/2015 Germany Frankfurt Carl-von-Noorden- office building am Main Platz 5 40 May 2015 2014/2015 Germany Frankfurt Genfer Strasse 10 office building am Main 41 May 2015 2014/2015 Germany Darmstadt Pfnorstrasse 1 office building 42 May 2015 2014/2015 Germany Dreieich An der Trift 65 office building 43 May 2015 2014/2015 Germany Dortmund Westfalendamm 87 office building 44 May 2015 2014/2015 Germany Hanover Rendsburger Strasse office building 18-20 45 May 2015 2014/2015 Germany Mannheim Am Exerzierplatz 2/ office building Friedrich-Ebert- Strasse 99 46 May 2015 2014/2015 Germany Neu-Isenburg Siemensstraße 12 office building 47 May 2015 2014/2015 Germany Neu-Isenburg Werner-Heisenberg- office building Strasse 2 48 June 2015 2014/2015 Germany Neuss Stresemannallee office building 4a-4c, 6

12 Report by Fund Management Overview of the property sales from the portfolio of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Transfer of Financial Country Town Building name, Building type number benefits and year address burdens of the Fund 49 June 2015 2014/2015 Belgium Brussels Rue Colonel Bourg office building 105a 50 June 2015 2014/2015 Great Britain Leeds 2 City Walk/ office building Sweet Street 51 August 2015 2014/2015 Germany Berlin Frankfurter Allee retail property 113 -117/ Möllendorfstrasse 52 August 2015 2014/2015 Germany Coburg Niorter Strasse 3 retail property 53 August 2015 2014/2015 Germany Trier Fleischstrasse 62-65/ retail property Metzelstrasse 8 54 October 2015 2015/2016 France Nice 400 Promenade des office building Anglais 55 March 2016 2015/2016 Great Britain Glasgow ‚Fisher House‘, office building 80 Bath Street 56 March 2016 2015/2016 The Nether- Amsterdam ‚FOZ‘, office building lands Gustav Mahlerlaan 4 57 March 2016 2015/2016 The Nether- Amsterdam ‚5 Keizers‘, office building lands Keizersgracht 271-287 58 March 2016 2015/2016 The Nether- The Hague ‚Sijthoff-City‘, office and lands Grote Marktstraat 39-53/ retail property Wagenstraat 31-49 59 March 2016 2015/2016 The Nether- Rotterdam Rochussenstraat office building lands 198-210

Report by Fund Management 13 Overview of the property sales from the portfolio of the CS EUROREAL fund since the initiation of the Fund‘s liquidation on 21 May 2012 Serial Transfer of Financial Country Town Building name, Building type number benefits and year address burdens of the Fund 60 March 2016 2015/2016 The Nether- Rotterdam ‚Hermes City Plaza‘, office and lands Stadthuisplein 16-38/ retail property St. Luciastraat 2-12 61 March 2016 2015/2016 The Nether- Schiphol-Rijk Beechavenue 1-19 office building lands 62 March 2016 2015/2016 The Nether- Schiphol-Rijk ‚Pegasus‘, office building lands Boeingavenue 253-271 63 March 2016 2015/2016 The Nether- Schiphol- Folkstoneweg 182 logistics lands Zuidoost building 64 March 2016 2015/2016 The Nether- Utrecht Orteliuslaan 750 office building lands 65 April 2016 2015/2016 Germany Berlin Grossbeerenstrasse retail property 119 -159 66 April 2016 2015/2016 Germany Fürth Europaallee/ retail property Magazinstrasse 90 67 April 2016 2015/2016 Germany Frankfurt Kennedyallee 87 office building am Main

14 Report by Fund Management After the mentioned 14 finalised property sales in the reporting Conversion/modernisation and construction work on the period, the CS EUROREAL fund still had a portfolio of 32 Fund’s properties within the scope of the management of the properties with a total value of about EUR 1.9 billion at 25 Fund can also occur during the liquidation phase with the aim locations in eleven European countries on the reporting date. of stabilising or increasing the value of the respective property and achieving the best possible selling result in the interest of In respect of the pending sale of the entire property portfolio of our investors. the CS EUROREAL fund, we point out that the majority of the properties are in Germany (49.2 % as at the reporting date) The construction work at Taunusanlage 8 in Frankfurt am Main and a good demand by property investors can be expected for (Germany) in the heart of Frankfurt‘s financial district was these properties because of the good and relatively more mostly completed after four years of planning and construction. stable economic development. The CS EUROREAL fund has a The excellent quality and the high environmental standard of substantially lower percentage of properties in Southern Euro- the property are proven by the DGNB Gold and Leed Platinum pean countries such as Italy, Spain and Portugal (only 25.3 % pre-certifications as seals of quality. A renowned internationally as at 30 September 2016 on the basis of the market values operating law firm already moved into one third of the lettable after completion), which have been economically and financially total office space of 29,952 m². weak for a long time but are now showing economic and property market recovery. The CS EUROREAL fund also continues Besides building work, an active asset management for the to have a large percentage of retail properties (54.6 % as at properties also includes an early extension of existing leases 30 September 2016 on the basis of the annual net target rent) and conclusion of leases with new tenants. In the reporting that have had a more stable value development in recent years period, Fund Management was able to extend leases or compared to the more economy-dependent office properties. conclude new leases for about 139,189 m² of rental space with tenants that have a good credit rating. That corresponds The active property management aimed at retaining or further to 25.2 % of the total lettable space of the property portfolio of increasing the value of the properties will be continued the CS EUROREAL fund as at 30 September 2016. For unchanged during the Fund liquidation phase in order to example, the leases for four DIY Centres in Berlin-Mariendorf facilitate the marketing of the properties. (Grossbeerenstrasse 119-159), Berlin-Weissensee (Malchower Chaussee 6-10), Fürth (Europaallee/Magazinstrasse 90) and

Report by Fund Management 15 Osnabrück (Hannoversche Strasse 111/Hettlinger Marsch), below average. The sales therefore had a positive effect on the with a total space of almost 79,000 m², were extended on a letting level. You will find more detailed letting information under long-term basis. Two of these properties, i.e. the properties in the ‚Letting Situation’ heading on pages 24 to 25 of this Report. Berlin-Mariendorf and in Fürth were successfully sold in April The average letting level in the reporting period was 85.2 % on 2016. Numerous leases for a total of 8,600 m² of rental space the basis of the annual gross target rent. Further sound rental in the Fund‘s largest property, the ‚Le Befane‘ shopping income could be generated for the CS EUROREAL fund on centre, Via S.S. 16 Adriatica / Via Macanno in Rimini (Italy), this basis. were extended. New leases for about 3,600 m² were also concluded with various tenants. A new lease for the cinema The two remaining loans, EUR 90.0 million for the ‚Rathaus- (6,108 m²) that is part of the shopping centre was negotiated Galerie‘ shopping centre, Friedrich-Ebert-Platz 1-2 in Lever with the existing tenant. New leases for a total rental space of kusen (Germany) and EUR 25.0 million for the property at about 15,800 m² were concluded with numerous tenants in the Orteliuslaan 750 in Utrecht (The Netherlands) were repaid in Localita Sandalli o Cariati shopping centre in Provincia di the reporting period. The Fund is therefore completely free Reggio Calabria (Italy). New tenants for more than 1,000 m² from debt as at the reporting date. Loans totalling almost were also won for the properties at Viale Certosa 2/Piazza EUR 1.4 billion have been repaid since the start of the Fund‘s Firenze in Milan (Italy) (2,154 m²), Avenue Juan Mermoz in liquidation on 21 May 2012. The investors will from now on Lyon (France) (2,519 m²), Bahnhofstrasse 12 and14 in receive higher asset distributions under otherwise identical Gelsenkirchen (Germany) (2,143 m²), Olomoucká 90 in conditions because the proceeds from the sale of properties Olomouc (Czech Republic) (1,121 m²), and the two office are no longer required for mortgage repayment. buildings in Lisbon (Portugal) (a total of 3,686 m²). Overall, the letting level was slightly increased by 0.3 percentage points to As at 30 September 2016, the CS EUROREAL fund achieved 85.5 % in the financial year 2015/2016. The letting level of a 1-year investment success of 0.5 %1,2 – calculated using the the last sold properties, particularly the portfolio of nine proper- standard BVI method – for the unit class in the EUR currency, ties in The Netherlands sold at the end of March 2016 was i.e. CS EUROREAL EUR. That was mainly due to the surplus

16 Report by Fund Management from rental income and the positive result from the 14 property The still large number of potential buyers interested in proper- sales concluded during the reporting period. The slightly ties and potential buyers interested in European commercial negative valuation result of -2.6 %5 in the revaluation of the properties should tendentiously have a positive effect on the properties was therefore more than compensated for. pending property sales. Numerous investors are still currently looking for properties in good locations because of the still low For exchange rate reasons, the unit class of the CS EUROREAL interest rates. fund in Swiss Francs, i.e. CS EUROREAL CHF, had a slightly lower performance of -0.3 %1,2 as at 30 September 2016 The sales activities therefore currently benefit from the still high calculated using the standard BVI method. You will find further percentage of retail properties in the portfolio of the information on the investment success development of the CS EUROREAL fund (54.6 % as at 30 September 2016) and Fund in the ‚Fund‘s Yield‘ section on pages 25 to 28 of this the still high percentage of Fund properties in Germany Annual Report. (49.2 % as at 30 September 2016). However, there are also negative effects resulting from the liquidation situation of the We inform you about the future prospects and the further Fund, for example, due to the fact that, in a liquidation phase, strategy for the sale of the remaining property portfolio of the properties must be sold at an unfavourable point in time in terms CS EUROREAL fund and the liquidation of the Fund in the of negotiation strength and possibly also market situation. ‚Outlook‘ section on page 40 ff. of this Annual Report. Although we are striving to sell all the Fund‘s properties before Fund Liquidation Strategy the management mandate for the CS EUROREAL fund will Since the start of the liquidation of the CS EUROREAL fund, pass to the Custodian bank on 30 April 2017, 24:00 hrs., we our primary objective has been the sale of all the properties, if expect that several properties of the Fund will be taken over by possible, before the expiry of the notice period for the termina- the Custodian Bank, which will then continue the controlled tion of our management mandate on 30 April 2017. To this liquidation of the Fund. end, the property selling process already started during the redemption suspension phase was continued. In the interest of Investor Structure all investors, the Fund’s properties will be sold quickly but also The sale of CS EUROREAL fund units in Germany was mainly at reasonable prices. The property selling is done in two basic via third-party banks and independent financial service providers. ways. On the one hand, we actively contact estate agents, A breakdown of the investor structure of the sales agents for consultants and potential investors via our long-standing the reporting period is not possible due to lacking information. contact network and on the other hand, potential buyers often contact us on their own initiative because the property portfolio of the CS EUROREAL fund is widely known.

Report by Fund Management 17 Brief Summary • A total of 14 properties were sold in the financial year Figures • Data • Facts 2015/2016 of the CS EUROREAL fund from 1 October • The CS EUROREAL EUR, the EUR unit class of the Fund, 2015 to 30 September 2016. A total of 82 properties have achieved an investment success of 0.5 %1,2 for the 1-year therefore been sold from the portfolio of the CS EUROREAL period between 30 September 2015 and the reporting date fund, with a total volume of almost EUR 4.6 billion, since the 30 September 2016. For exchange rate reasons, the start of redemption suspension on 19 May 2010 until the CS EUROREAL CHF, the Swiss Francs unit class of the reporting date, 30 September 2016. A total of 67 properties Fund, achieved an investment success of -0.3 %1,2 in the of the property portfolio of the CS EUROREAL fund with a same period. total volume of about EUR 3.2 billion have been sold since the initiation of the Fund’s liquidation on 21 May 2012. • The liquidation of the CS EUROREAL fund was initiated on 21 May 2012. We, CREDIT SUISSE ASSET MANAGEMENT As at the reporting date, the Fund still had 32 properties in Immobilien Kapitalanlagegesellschaft mbH, which manages eleven European countries at 25 established locations, with the CS EUROREAL fund on a trustee basis, have given a total market value volume (projects at book value) of notice to terminate the management of the Fund to take EUR 1,876.4 million. 26 properties are directly owned and effect on 30 April 2017. We continue to be responsible for six properties are owned through property investment the proper management of the Fund and the sale of the companies. Fund‘s properties until such date. A pay-out of the available liquid funds of the CS EUROREAL fund to the investors has • The Fund‘s net assets as at 30 September 2016 amounted been effected in the form of half-yearly dividends on the to EUR 2,185.2 million, whereas the value of the managed basis of available liquidity since the start of the Fund‘s liqui- Fund‘s assets (gross assets of the Fund) amounted to dation. EUR 2,362.4 million.

18 Report by Fund Management • The percentage of the CS EUROREAL portfolio invested in i.e. coupons, of the CS EUROREAL EUR unit class were Germany was 49.2 % of the property market values as at invalidated due to the legal requirement under Article 358 (3) 30 September 2016. The foreign percentage of the property of the German Capital Investment Code (KAGB). The rights portfolio as at the reporting date was 50.8 % of the market vested by bearer unit certificates and coupons were instead values of the properties. All foreign properties are situated in certificated by the global certificate of the CS EUROREAL as Europe. at 1 January 2017. The previous owners of the invalidated certificates have become co-owners of the global certificate • The letting level was 85.5 % as at 30 September 2016. The at a percentage equivalent to their share of units. The average letting level in the reporting period was 85.2 %. The respective share in collective holdings is credited to a basis for that was the conclusion of new leases or lease separate custody account of the Custodian Bank of the extensions during the reporting period for a total space of CS EUROREAL fund. 139,189 m² (about 25.2 % of the total lettable space of the Fund as at 30 September 2016). The presenter can demand that the respective share in collective holdings be credited to a custody account to be • The gross liquidity of the CS EUROREAL fund at the end of named by him/her and managed for him/her by submitting the financial year 2015/2016 was EUR 294.2 million an invalidated bearer unit certificate. (13.5 % of the Fund‘s net assets). Holders of coupons that became due before 1 January 2017 • The first interim dividend payment for the financial year can assert their claim for payment resulting therefrom by 2015/2016 of the CS EUROREAL fund was made on presenting such coupons to the Custodian Bank of the 26 July 2016. The dividend (coupon no. 28) for the EUR CS EUROREAL fund. If coupons are redeemed at the unit class of the CS EUROREAL fund was EUR 3.00 per Custodian Bank, it may only make payment to a domestic unit and the dividend for the CHF unit class of the bank for transfer to a bank account held for the presenter. If CS EUROREAL fund was CHF 3.50 per unit. Fund a bank accepts the coupons for redemption, it may only Management passed a resolution for the Fund‘s financial transfer the paid amount to a bank account held by it in year to make a reinvestment as at the end of the financial Germany for the presenter. year 30 September 2016 instead of paying out a year-end dividend. You will find detailed information on the above figures and facts and on the individual properties of the CS EUROREAL fund on • On 1 January 2017, all bearer unit certificates, i.e. physical the following pages of this Annual Report. certificates, that were not held in collective safekeeping but were still in circulation and all profit participation certificates,

Report by Fund Management 19 Property Portfolio Management Amsterdam (The Netherlands), ‚5 Keizers‘, No properties were acquired for the portfolio of the Keizersgracht 271–287 CS EUROREAL fund in the reporting period from 1 October Amsterdam (The Netherlands), ‚FOZ‘, Gustav Mahlerlaan 4 2015 to 30 September 2016 due to the Fund‘s liquidation Schiphol-Zuidoost (The Netherlands), Folkstoneweg 182 initiated since 21 May 2012. A total of 14 properties were sold Schiphol-Rijk (The Netherlands), ‚Pegasus‘, from the portfolio of the CS EUROREAL fund in the financial Boeingavenue 253–271 year 2015/2016 on the basis of the selling strategy imple- Schiphol-Rijk (The Netherlands), Beechavenue 1–19 mented for the liquidation of the Fund. The Hague (The Netherlands), ‚Sijthoff-City‘, Grote Marktstraat 39-53/Wagenstraat 31–49 Sales and Disposals of Properties in the Rotterdam (The Netherlands), Rochussenstraat 198–210 Reporting Period until 30 September 2016 Rotterdam (The Netherlands), ‚Hermes City Plaza‘, Nice (France), 400 Promenade des Anglais Stadthuisplein 16-38/St. Luciastraat 2–12 The conclusion of the notarial deed of sale (Acte de Vente) and Utrecht (The Netherlands), Orteliuslaan 750 the associated transfer of benefits and burdens upon purchase The sale of nine Dutch properties held by the CS EUROREAL price payment took place in October 2015. The binding fund as part of a large property portfolio in The Netherlands preliminary contract of sale (Promesse de Vente) for the sale was secured by a binding contract of sale in March 2016. The of the office building at 400 Promenade des Anglais had transfer of the benefits and burdens took place at the end of already been signed in July 2015. The property had been March 2016. The property package was marketed in a struc- acquired as project development in 2003. The realised selling tured bidding process. The realised selling price for the port price was significantly higher than the market value last deter- folio was above the sum of the last determined market values. mined by the valuation committee. Berlin (Germany), Grossbeerenstrasse 119–159 Glasgow (Great Briatin), ‚Fisher House‘, 80 Bath Street The contract of sale for the DIY Centre in Berlin-Mariendorf The contract of sale for ‚Fisher House‘, an office and retail was notarised in January 2016. The transfer of the benefits building in Glasgow, was concluded in September 2015. The and burdens took place at the beginning of April 2016. The transfer of benefits and burdens and the purchase price pay- achieved selling price for the property, which had been in the ment took place in March 2016. The property was originally portfolio of the CS EUROREAL fund since 2004, was signifi- acquired for the Fund in 1997. The realised selling price was cantly higher than the last determined market value. slightly below the last determined market value.

20 Report by Fund Management Geographical Distribution of the Fund's Properties (Basis: market value after completion)

Germany: 49.2 % Italy 19.0 % Rhine-Main 13.2 % Rhine-Ruhr 19.7 % Other conurbations in Germany 4.0 % The Netherlands 9.7 % Other regions in Germany 12.3 % France 5.2 % Portugal 4.7 % Czech Republic 4.1 % Great Britain 3.9 % Belgium 0.6 % Spain 1.6 % Austria 0.9 % Sweden 1.1 %

Fürth (Germany), Europaallee/Magazinstrasse 90 Information on further sales activities after the The sale of this DIY Centre in Fürth was secured by notarial reporting date of 30 September 2016 deed in February 2016 and the transfer of the benefits and Stockholm (Sweden), ‚Hilton 6‘, Telegrafgatan 8 A-B burdens took place mid-April 2016. The property acquired in 100 % of the holdings in the property company SPV Telegraf- 2004 was sold at a selling price well above the market value gatan RE AB, owner of the ‚Hilton 6‘ property at Telegrafgatan last determined by the valuation committee. 8 A-B, Stockholm, were sold. The property which was built in 2000 and acquired for the CS EUROREAL fund in June 2008 Frankfurt am Main (Germany), Kennedyallee 87 has a floor space of 5,386 m². A selling price well above the The contract of sale for the Kennedyallee 87 property in last determined market value for the property was achieved Frankfurt am Main was signed in March 2016. The transfer of due to the successful conclusion of new leases and lease the benefits and burdens also took place in April 2016. The extensions for rental space in the property at the beginning of agreed purchase price for the property that had originally been 2016 and the good overall conditions in the investment market. transferred to the Fund in 2000 was significantly above the market value last determined by the valuation committee.

Report by Fund Management 21 Vienna (Austria), Computerstrasse 6 Conversion and Modernisation Work The sale of the property at Computerstrasse 6, Vienna, was Renovation, modernisation, refurbishment or maintenance secured by contract of sale on 14 December 2016. The transfer work was carried out in selected properties held by the of the benefits and burdens took place on 23 December 2016. CS EUROREAL fund where such work was necessary or The property acquired in 2008 was sold at a selling price above increased the value. All building regulations and permit the market value last determined by the valuation committee. requirements were taken into account in such work.

Amsterdam (The Netherlands), ‚Acanthus‘, The work carried out ensures the sustainable value develop- Bijlmerdreef 24–74 ment of the properties, contributes to the satisfaction of The sale of the property at Bijlmerdreef 24-74, Amsterdam, tenants and potential tenants and has a positive effect on the was notarised on 23 December 2016. The transfer of the letting level. benefits and burdens took place on the same day. The property acquired in November 2006 was sold at a selling price below Some relevant, technically demanding examples, which the market value last determined by the valuation committee. contribute to the long-term property value retention, are given below: Nuremberg (Germany), ‚Mercado‘, Äussere Bayreuther Strasse 80–84a, 98 Comprehensive modernisation measures are envisaged for the Leverkusen (Germany), ‚Rathausgalerie‘, ‚Flensburg-Galerie‘ shopping centre, Holm 57–61/Angel- Friedrich-Ebert-Platz 1–2 burger Strasse 17, 19, 31, 33/Süderhofende 40–42 in Leverkusen (Germany), Friedrich-Ebert-Platz 4 Flensburg (Germany). Such include the direction of various Rimini (Italy), ‚Le Befane‘, escalators, change of the shopping mall routing and optimisa- Via SS 16 Adriatica/Via Macanno tion of the lighting. The measures are expected to be realised The four above-mentioned properties were sold as a joint by the middle of the 2nd quarter 2017. property portfolio under framework contract dated 22 December 2016. The transfer of the benefits and burdens A lease for a rental space of 3,500 m² was concluded for the is scheduled for March/April 2017. property at Gelsenkirchen (Germany), Bahnhofstrasse 12 and 14. The finishing work for the rental space was done in Berlin (Germany), Salzufer 22/Dovestrasse 2–4 December 2016 after the end of the reporting period. The The contract of sale for the property, Salzufer 22/Dovestrasse required final acceptance of the property by the building 2-4 in Berlin, was notarised on 29 December 2016. The trans- authorities is scheduled for the 1st quarter of 2017. fer of benefits and burdens is scheduled for February 2017. A total of 139,189 m² of the Fund‘s lettable space could be let under new leases or lease extensions in the reporting period. Renovation and building work to be performed by the Landlord within the scope of the letting was properly sub-contracted and completed.

22 Report by Fund Management Types of Use of the Fund's Properties6 (Basis: annual net target rent)

Other 1.2 % Ofﬁce 35.1 %

Hotel 0.7 %

Leisure 1.0 %

Warehouse/Logistics 1.4 %

Garages/Parking Spaces 6.0 %

Retail/Catering 54.6 %

6 Properties under construction are not included because of uniform industry standards.

Projects Portfolio Structure The first tenant moved into his rental space in the high-rise As at the reporting date 30 September 2016, the property project at Taunusanlage 8 in Frankfurt am Main (Germany) portfolio of the CS EUROREAL fund consisted of 32 proper- on 1 August 2016. The bistro on the ground floor started its ties at 25 locations in eleven European countries. 26 proper- operations mid-August 2016. The work progress in the common ties were directly owned and 6 properties were owned via areas is near completion. The finishing work in the vacant property companies. The number of properties held by the space continues. The work on the outdoor facilities has been CS EUROREAL fund reduced by 14 properties compared to completed. The certification to LEED Platinum is being pro- the end of the last financial year. cessed concurrently with the building work and is on schedule. The property assets at the end of the financial year 2015/ The building permit based on the second modified planning 2016 amounted to EUR 1,884.3 million (market values includ- application for the revitalisation of the ‚Mercado‘ shopping ing projects at market value after completion), of which 50.8 % centre in Nuremberg (Germany), Äussere Bayreuther was invested in other European countries. The foreign percent- Strasse 80–84a, 98, was granted after the end of the report- age thus reduced compared to the end of the previous financial ing period in December 2016. year (as at 30 September 2015: 58.0 %) due to numerous sales of properties held by the Fund abroad, especially in The Netherlands where nine properties were sold. The Germany percentage was therefore 49.2 %. The property portfolio continues to consist of mainly retail properties (54.6 %) (+5.3 percentage points compared to 30 September 2015) and

Report by Fund Management 23 office properties (35.1) (-5.7 percentage points compared to Letting Situation 30 September 2015).There was a significant increase in the The letting level could be stabilised at a good level in a com- Fund’s retail property percentage because office properties petitive comparison in the financial year 2015/2016 and could were predominantly sold during the reporting period. therefore contribute to the Fund‘s positive overall result. The average letting level was 85.2 % in the reporting period and In terms of the economic age structure, 26.5 % of the proper- 85.5 % on the reporting date 30 September 2016. ties are younger than 10 years, whereas 69.8 % of the properties have an economic age between 10 and 20 years. 3.7 % of The following special letting activities were initiated for the the properties are older than 20 years. following portfolio properties because of the letting situation:

The average volume of the Fund‘s properties in terms of The vacancy level of the property at Berlin (Germany), market value during the last 12 months before the reporting Salzufer 22/Dovestrasse 2–4 was 33.6 % as at 30 September date, 30 September 2016, (with 13 end-of-month values) 2016. A new lease for 1,356 m² of office space was concluded amounted to EUR 2,008.4 million. during the reporting period. The main tenant handed back a sub-area of 2,328 m² during the reporting period. Promising 72.4 % of the properties had a market value of up to talks are currently in progress with various potential tenants. EUR 150.0 million at the end of the financial year 2015/2016. Only two Fund properties, i.e. ‚Le Befane‘ at Via S.S. 16 The property, Gelsenkirchen (Germany), Bahnhofstrasse Adriatica/Via S.S. Macanno in Rimini (Italy) and ‚Rathaus- 12 and 14, was 41.0 % let on the reporting date. A lease for Galerie‘ at Friedrich-Ebert-Platz 1-2 in Leverkusen (Germany) 2,143 m² of retail and office space was concluded with a had a market value exceeding EUR 200.0 million, which public-sector tenant. The remaining unlet space is being inten- togehter correspond to 27.6 % of the property assets of the sively marketed. CS EUROREAL fund as at 30 September 2016. The vacancy level in the property, Berlin (Germany), You will find detailed information on the structure of the property Müllerstrasse 141, was 31.8 % on the reporting date after assets in the following graphics: the main tenant had moved out. Promising lease negotiations are currently in progress with a company from the retail sector. • Geographical Distribution of the Fund’s Properties (Page 21) The letting level of the property, Glasgow (Great Britain), 4 • T ype of Use of the Fund’s Properties (Page 23) Atlantic Quay/70 York Street, was 47.8 % in the reporting period. Talks are currently being held with potential tenants. • Size Classes of the Fund’s Properties (Page 25)

• Economic Age Structure of the Fund’s Properties (Page 31)

24 Report by Fund Management The property, Glasgow (Great Britain), 6 Atlantic Quay/55 Size Classes of the Fund's Properties6 Robertson Street, was 100 % unlet after the tenant had (Basis: market value) moved out. The vacant space is currently being degutted and a show office will be established to increase the competitiveness. Talks are currently being held with potential tenants. EUR > 200 million up to EUR 10 million 27.6 % (2 properties) 1.2 % (3 properties) The vacancy level in the property, Lyon (France), Avenue EUR 10 ≤ 15 million Jean Mermoz, was 53.2 % on the reporting date. A day clinic 0.6 % (1 property) will start its operations on about 1,700 m² of rental space in EUR 100 ≤ 150 million EUR 15 ≤ 25 million 24.6 % (3 properties) 10.8 % (9 properties) the 1st quarter of 2017. Promising talks are currently being held with potential tenants from the healthcare and IT sectors. EUR 25 ≤ 50 million EUR 50 ≤ 100 million 18.3 % (9 properties) The property, Toulouse (France), Le Galilée/LOT 02B, in 16.9 % (4 properties) the office ensemble, ZAC Andromède, was 42.3 % let on the reporting date. Promising talks are currently being held with 6 Properties under construction are not included because of uniform industry standards a consultancy firm for a lease covering all available vacant space.

The vacancy level of the property, Toulouse (France), 12 Rue Louis Courtois de Vicose, in terms of space was 75.1 % on The Fund’s Yield the reporting date, 30 September 2016. The unlet space was The performance of the EUR unit class of the CS EUROREAL intensively marketed. Talks are currently being held with a fund in the Fund‘s expired financial year 2015/2016 from renowned company from the financial services sector for a 30 September 2015 to 30 September 2016 was +0.5 %1 – lease for approx. 6,500 m² of office space. calculated using the standard BVI method – and therefore well above previous year‘s investment success of -5.8 %. The vacancy level of the property, Madrid (Spain), Calle de Julián Camarillo 19–21, in terms of space was 42.7 %. The The value development continues to be largely influenced by a unlet space is being intensively marketed. challenging market environment and the resulting value adjustments of the property portfolio determined by the rota-based A total of 139,189 m² of the Fund‘s lettable space could be let revaluations of the Fund‘s properties by the independent under new leases or lease extensions in the reporting period. valuers, which could however partly be compensated for by the Renovation and building work to be performed by the Landlord rental income from the Fund‘s properties and the Fund‘s posi- within the scope of the letting was properly sub-contracted and tive result of the Fund from property sale transactions in the completed. financial year 2015/2016 of the CS EUROREAL fund. The

Report by Fund Management 25 revaluation of 37 Fund properties with a total volume of Management e.V.) therefore decided to adapt the performance EUR 1,837.2 million in the 1-year period before 30 September calculation method to open-ended real estate investment funds 2016 resulted in an overall negative valuation balance of in the process of liquidation. The method was changed in that EUR -46.9 million or -2.6 %. a reinvestment of the dividend at the redemption price is only taken into account until the point in time of the Fund’s liquida- The conventional standard BVI method will continue to be used tion – i.e. until 21 May 2012 in the case of the CS EUROREAL because of the comparability of the fund performance results fund. From that point in time onwards, dividends, including of the various open-ended real estate investment funds – to those of the CS EUROREAL fund already paid on 3 July date also for open-ended real estate funds in the process of 2012, 11 December 2012, 18 June 2013, 10 December liquidation. The costs incurred at the investor level, e.g. tax, 2013, 29 July 2014, 27 January 2015, 28 July 2015, front-end load or custody account charges, are not taken into 26 January 2016 and 26 July 2016 are only included in the account in the BVI method because they can differ from one value development calculation as non-interest-bearing investor to the next and can therefore not be presented within amounts. If a reinvestment of the dividend is not taken into the scope of a standardised calculation method. A reinvestment account as from the aforementioned date, the EUR unit class of the dividends at the redemption price is also assumed in the of the CS EUROREAL fund had an investment success of conventional standard BVI method. A reinvestment has no +0.4 %7 for the 1-year period as at 30 September 2016. longer been possible since 21 May 2012 because of the initiated liquidation of the Fund, and the final cessation of Since its launch on 6 April 1992, the CS EUROREAL EUR purchase and redemption of units, of the CS EUROREAL unit has shown an average annual increase of 3.2 % p.a.1 until fund. The German Federal Association of Investment and 30 September 2016 – calculated using the standard BVI Asset Management (BVI Bundesverband Investment und Asset method (end of last financial year 2014/2015: +3.3 % p.a.1).

1 Investment success calculation according to the method of the German Federal Association of Investment and Asset Management (BVI Bundesverband Investment und Asset Management e.V.): Investment at unit value (= redemption price)/valuation at unit value; reinvestment of dividend at unit value (= free-of-charge reinvestment). The calculation using the BVI method, which serves comparability, does not take into account individual factors of the Fund or the investor, such as tax aspects of the investment (e.g. capital gains tax, tax-exempt portion of the dividend). The one-off front-end load of up to 5% and individual costs, like fees, commission and other remuneration, are not included in the calculation and would have a negative effect on performance if they were included. Historic value developments and financial market scenarios are not reliable indicators for current or future results. 7 Investment success calculation for open-ended real estate funds in the process of liquidation according to the method of the German Federal Association of Investment and Asset Management (BVI Bundesverband Investment und Asset Management e.V.) (first publication on: 31 July 2013): Investment at unit value (= redemption price)/valuation at unit value; reinvestment of dividend at unit value (= free-of-charge reinvestment) until the point in time of the Fund’s liquidation (CS EUROREAL: 21 May 2012). From that point in time onwards, dividends/capital distributions are included in the performance calculation as non-interest-bearing amounts. The calculation using the BVI method, which serves comparability, does not take into account individual factors of the Fund or the investor, such as tax aspects of the investment (e.g. capital gains tax, tax-exempt portion of the dividend). The one-off front-end load of up to 5% and individual costs, like fees, commission and other remuneration, are not included in the calculation and would have a negative effect on performance if they were included. Historic value developments and financial market scenarios are not reliable indicators for current or future results.

26 Report by Fund Management The investment success of the EUR unit class of the The investment success of the CS EUROREAL CHF, the unit CS EUROREAL fund in the period from the initiation of the class of the Fund in Swiss Francs launched on 1 October Fund‘s liquidation on 21 May 2012 to the reporting date was 2005, calculated in accordance with the conventional standard -10.8 %1 (or an average of -2.6 % per annum)1 if calculated BVI method with reinvestment of the dividends, was -0.3 %1 in using the standard BVI method or -7.77 (or an average of a 1-year comparison as at the reporting date. If the BVI calcu- -1.8 % per annum)7 if calculated using the BVI method of lation method for open-ended real estate funds in the process open-ended real estate investment funds in the process of of liquidation is used, the CS EUROREAL CHF had an invest- liquidation. ment success of -0.4 %7 in a 1-year comparison.

CS EUROREAL Unit class EUR Investment success as at 30 September 2016 The investment success of the CHF unit class of the (as per BVI method1) CS EUROREAL fund was in the past, unlike the EUR unit, cumulative average additionally burdened by the surprising upward revaluation of in % p.a. in % the Swiss Franc in relation to the Euro. As a result of the 1 year 0.5 0.5 unforeseeable cancellation of the minimum exchange rate of 3 years -10.0 -3.5 1.20 CHF = 1 EUR decided by the Swiss National Bank 5 years -13.8 -2.9 (SNB) on 15 January 2015, the CHF/EUR exchange rate 10 years 1.8 0.2 settled at almost 1:1. At the time of SNB’s decision, the 15 years 25.2 1.5 hedging level was 75 % and thus in the middle of the minimum 20 years 65.4 2.6 hedging level of 50 % and the maximum possible hedging level since launch 117.1 3.2 of 100 % as provided for in the Sales Prospectus. After SNB’s decision, the hedging level was gradually increased again. The investment success of the CHF unit class of the CS EUROREAL CS EUROREAL Unit class EUR fund of -12.1 %1 in a 3-year comparison also significantly Value development as per the BVI method for open-ended differed from the investment success of the EUR unit class of real estate investment funds in the process of liquidation as the CS EUROREAL fund of -10.0 %1 because of this currency at 30 September 2016 effect. cumulative average in % p.a. in % Since the launch of the Swiss Francs unit class of the 1 year 0.4 0.4 CS EUROREAL fund on 1 October 2005, it has achieved a 3 years -8.5 -2.9 total investment success of -3.8 % (or an average of -0.4 % 5 years -10.8 -2.3 per annum)1 if calculated using the conventional standard BVI 10 years 5.3 0.5 calculation method or a total investment success of +0.3 % (or 15 years 29.6 1.7 an average of 0.0 % per annum)7 if calculated with the BVI 20 years 71.5 2.7 calculation method for open-ended real estate funds in the since launch 124.8 3.4 process of liquidation.

Report by Fund Management 27 CS EUROREAL Unit class CHF The investment success of the CHF unit class of the Investment success as at 30 September 2016 CS EUROREAL fund in the period from the initiation of the (as per BVI method1) Fund‘s liquidation on 21 May 2012 to the reporting date was cumulative average -12.8 %1 (or an average of -3.1 % per annum1) if calculated in % p.a. in % using the standard BVI method or -9.0 %7 (or an average of 1 year -0.3 -0.3 -2.1 % per annum7) if calculated using the BVI method for 3 years -12.1 -4.2 open-ended real estate investment funds in the process of 5 years -15.4 -3.3 liquidation. 10 years -6.5 -0.7 since launch -3.8 -0.4 Distribution The liquidation of the CS EUROREAL fund was initiated by resolution of 21 May 2012. The net liquidity obtained within CS EUROREAL Unit class CHF the scope of the successive sale of the Fund‘s assets will be Value development as per the BVI method for open-ended paid out, together with the net income from the management real estate investment funds in the process of liquidation as of the Fund, to the investors as dividends on an about at 30 September 2016 half-yearly basis. A total amount of EUR 309.1 million8 was cumulative average paid out as interim dividend for the financial year 2015/2016 in % p.a. in % of the CS EUROREAL fund on 26 July 2016. A resolution for 1 year -0.4 -0.4 reinvestment as at the end of the year on 30 September 2016 3 years -10.2 -3.5 instead of the payment of a year-end dividend was passed by 5 years -11.7 -2.5 Fund Management for the financial year 2015/2016. How 10 years -2.5 -0.3 ever, it is currently envisaged that an extraordinary distribution since launch 0.3 0.0 of liquid funds received from the sale of properties will be

28 Report by Fund Management made before the transfer of the management mandate to the Risk Provision – Capital Gain Tax Custodian Bank provided that such are not needed as liquidity A taxation of realised gain on sale (capital gains tax) can occur for the proper further management of the Fund. when foreign property is sold. The tax burden is dependent on many unknown factors, such as the realised capital gain, the Euro unit class of the CS EUROREAL in EUR: time of sale and the applicable tax regulations. A total of EUR 295.0 million was distributed for the EUR unit class in the financial year 2015/2016 of the Fund. This Provisions of EUR 57.9 million were made as at 30 September corresponds to EUR 3.00009 per unit. 2016 for tax on potential gain from the sale of foreign properties.

Swiss Francs unit class of the CS EUROREAL in CHF: Loan and Foreign Currency Management A total of CHF 15.2 million (EUR 14.1 million8) was distributed Loans for the CHF unit class for the financial year 2015/2016 of the The two remaining loans, EUR 90.0 million for the ‚Rathaus- Fund. This corresponds to CHF 3.50009 per unit. Galerie‘ shopping centre, Friedrich-Ebert-Platz 1-2 in Lever kusen (Germany) and EUR 25.0 million for the property at The interim dividend and the year-end dividend will be fully Orteliuslaan 750 in Utrecht (The Netherlands), were repaid in deducted in the calculation of the unit price on the interim the reporting period. The Fund is therefore completely free dividend payment date and the year-end dividend payment date from debt as at the reporting date. Loans totalling almost respectively. You will find detailed information on the distribution EUR 1.4 billion have been repaid since the start of the Fund‘s and further tax information on pages 100 ff. of this Annual liquidation on 21 May 2012. Report.

8 The dividend of the CHF unit class of the CS EUROREAL fund was converted to EUR using the foreign exchange rate of 1 EUR = 1.084100 Swiss Francs (CHF) applicable on 26 July 2016. 9 The dividend and amount of distributed income must be stated with four decimal places according to Article 5 (1) item 1 of the German Investment Tax Act (InvStG).

Report by Fund Management 29 Foreign Currency Positions EUR 19.0 million and was 92.7 % protected by Euro hedging The conservative strategy of Fund Management is to keep the transactions as at the reporting date. The element of the risks resulting from exchange rate differences low and to Fund’s assets situated in the Czech Republic is predominantly hedge as far as possible the Fund’s assets held in foreign accounted for in euros because all relevant contracts were currency. The hedging of the exchange rate risk is effected by concluded on a Euro basis. Hedging transactions were not taking out foreign currency loans (cf. loans) and by forward made for the remaining amount accounted for in Czech foreign exchange transactions. Crowns because this only amounted to a low EUR 7.5 million compared to the Fund‘s volume. The average exchange rate Only the investments in Great Britain, Sweden and the Czech hedging for the portion of the Fund’s assets that is mathemati- Republic are currently subject to a potential currency risk cally allocable to the Swiss Francs unit class was 89.4 % as at because the assets of the CS EUROREAL fund are predomi- the reporting date 30 September 2016. nantly invested in the Euro zone. The element of the Fund’s assets situated in Great Britain and accounted for in UK Liquid Investments pounds Sterling was (converted to) EUR 67.2 million and was The liquid assets consist of cash at bank and fixed-term 98.2 % protected by Euro hedging transactions as at the deposits only. reporting date see Overview: ‚Exchange Rate Hedging Trans- actions’. The element of the Fund’s assets situated in Sweden The gross liquidity of the CS EUROREAL fund was 13.5 % of and accounted for in Swedish Krona (SEK) was (converted to) the Fund’s net assets as at 30 September 2016.

30 Report by Fund Management Risk Management Economic Age Structure of the Fund's Properties6 The risk management of CREDIT SUISSE ASSET (Basis: market value) MANAGEMENT Immobilien Kapitalanlagegesellschaft mbH is aimed at ensuring the compliance with current and future More than 20 years Up to 5 years (older than 1996) 3. 7 % statutory requirements and the internal investment standards (2011-2016) 1.6 % 5 to 10 years and instructions of the CREDIT SUISSE Group. 15 to 20 years (1996-2001) 12.5 % (2006-2011) 24.9 %

For the fulfilment of these tasks, risk management is anchored in our organisation as an independent, centrally organised unit reporting directly to the management board. On the basis of the risk limits defined by the management board, the core 10 to 15 years task of the centralised risk management department is to (2001-2006) 57.3 % systematically identify, continuously assess, monitor and control all substantial risks at the level of the capital investment/asset 6 Properties under construction are not included management company and the managed Fund’s assets. The because of uniform industry standard. management board and the supervisory board of the company are regularly informed of the risk situation of the company and the managed assets by the risk management function.

For the fulfilment of this task, the risk management function The centralised risk management department regularly uses the many years of experience and the profound identifies and reports on the risk situation of the individual knowledge of our staff: Every identified risk was assigned risks and total risks. Threshold values are set and escalation to a specific risk manager, who is responsible for the daily processes are laid down for risk control. This allows an early monitoring and control of the risks assigned to him. This recognition of the risks and the implementation of counter- includes the continuous optimisation of the risk management measures. The risk management methods and processes are processes.

Report by Fund Management 31 regularly checked and further developed in order to cope with The investment risks generally describe the potential value new requirements or special situations such as the liquidation fluctuations of an investment, which can under certain circum- of an investment fund. stances result in losses. These investment risks can be divided into counterparty risks, credit risks, market price risks, liquidity The comprehensive approach, consisting of the decentralised risks, property risks, unit redemption risks and portfolio technical competence and centralised organisation chosen (strategy) risks. The market price risks can be divided into by CREDIT SUISSE ASSET MANAGEMENT Immobilien property market risks, foreign currency risks and interest rate Kapitalanlagegesellschaft mbH allows a complete risk risks. inventory with competent control of the individual risks, and the centralised assessment, control, monitoring and reporting of These risks can occur at different levels of the real estate the risks facilitate the identification of the interdependencies investment fund, which explicitly consists of a liquidity portfolio between the different risk areas. Potential undesirable level, a property portfolio level and an overall fund level. The developments can thus be timely countered by adapting the effect of the aforementioned risk types can differ significantly decisive processes. depending on their extent.

Main Risks and Events During the Reporting The main risk events during the financial year 2015/2016 Period from 1 October 2015 to 30 September 2016 are described An investment in an open-ended real estate investment fund below together with the implemented risk reduction, elimination – like the CS EUROREAL fund – involves both opportunities or transfer. and risks for the fund investor. These risks resulting from the investment are generally called investment risks. There are also • Counterparty Risks/Credit Risks additional operational risks that mainly result from the interplay Counterparty risks on the liquidity side are the risks arising of personnel, systems and processes of the investment from business partners who, after liquid funds were invested company and can significantly affect the profit result of the with them, do not or cannot make full payment, or payment investment company. without causing a loss, when the payment is due. These risks are countered by a creditwatch of the counterparties and a

32 Report by Fund Management diversification of the invested funds at different banks. Coun- As at 30 September 2016, about 92.3 % of the let space of terparties are carefully checked and selected after risk assess- the funds of CREDIT SUISSE ASSET MANAGEMENT Immo- ment in order to minimise default risks. bilien Kapitalanlagegesellschaft mbH was let to tenants who have a rating by internationally recognised rating agencies or The liquid funds of the Fund were invested exclusively as cash are government tenants that do not pose, or pose an extremely at bank (about EUR 94.2 million (32.0 % of liquidity; 4.3 % of unlikely, insolvency or default risk. After the level of the rent the Fund‘s net assets)) and fixed-term deposits (about disputes due to payment refusals by tenants, insolvencies of EUR 200.0 million (68.0 % of liquidity; 9.2 % of the Fund‘s net tenants and building condition disputes – measured on the assets)) as at the reporting date 30 September 2016. The basis of the value in dispute compared to the annual rental credit risk was continuously monitored and could be assessed income – and pending court proceedings had increased by 1.6 as acceptable for the reporting period because the credit percentage points to 6.0 % of the annual net target rent of the worthiness of all counterparties was in the investment grade portfolio properties in the financial half-year 2015/2016 of het range. Fund compared to the end of the previous financial year of the CS EUROREAL fund, this level reduced again by 0.9 percent- Counterparty risks on the property side (tenant risks and risks age points to 5.1 % as at the end of the financial year 2015/ arising from suppliers, general contractors, administrators or 2016 of the Fund. 10 of the 32 portfolio properties and 16 other service providers) describe the risk that a loss can occur already sold properties were affected by rent disputes. These because of a complete or partial default by the counterparty or are largely retail properties. The level of the rent disputes was a worsening of the creditworthiness of the counterparty (e.g. high compared to the internally set limit. The increase com- tenant or service provider). On both the tenant side and the pared to the reporting date at the end of the previous financial service provider side, the risk generally increases as the year 2014/2015 of the Fund is mainly due to the fact that the creditworthiness of the counterparty decreases and as the basis of the underlying total annual net target rent reduced dependence on a single counterparty increases (cluster risk/ significantly as a result of the sold properties whereas the total concentration risk). A particular aim of the Fund is to let to amount in dispute increased slightly. counterparties who do not pose, or pose only a small, insolvency or default risk. The aforementioned factors are regularly monitored by the risk management department. The creditworthiness of the tenants from the private sector is – as already mentioned – monitored with the help of ratings from internationally recognised rating agencies.

Report by Fund Management 33 • Market Price Risks the Custodian Bank (Commerzbank AG), if applicable with These risks generally result from the danger of detrimental incurred Land Transfer Tax. Although we are striving to sell all changes in market prices or price-influencing parameters in the Fund‘s properties before the management mandate for the liquid markets. Market price risks include property price risks, CS EUROREAL fund passes to the Custodian bank on interest rate risks and foreign currency risks. The property 30 April 2017, 24:00 hrs., we expect that several properties of price risk can be impacted by market effects and by the the Fund will be taken over by the Custodian Bank, which will specific liquidation situation of the Fund. then continue the controlled liquidation of the Fund. This means that price risks will continue to exist in connection with • Property Price Risks the Fund‘s liquidation after the transfer. The property market and its sub-markets are subject to long- term cycles and numerous other influences, particularly As at 30 September 2016, the portfolio of the CS EUROREAL macro-economic and micro-economic trends. These influenc- fund had a negative market value development of the Fund‘s ing factors can cause a change in the market values of the properties (-2.6 % or EUR -46.9 million5) based on the 1-year portfolio properties and thus the net asset value of the real period from 1 October 2015 to 30 September 2016. Higher estate investment fund. This in turn affects the Fund‘s assets value adjustments could be identified for properties for which and thus the unit value. Such developments can be positive structural measures, like the new letting of larger spaces or and thus can also have beneficial effects on the real estate extensive building work, were or are necessary. investment fund. Negative trends represent a risk. The letting level increased slightly from 85.2 % at the start of In the course of the progressing liquidation of the the reporting period on 30 September 2015 to 85.5 % at the CS EUROREAL fund and the approaching end of the end of the reporting period on 30 September 2016. The management mandate of the capital investment and asset average letting level in the reporting period was 85.2 % as at management company, there may be a market pressure on the 30 September 2016. This increase in the letting level by 0.3 achievable property prices which in turn can have a negative percentage points as at the reporting date was mainly due to impact on the possible liquidation proceeds. However, the the conclusion of new leases for some properties of the Fund selling process for properties not sold before the management or the extension of existing leases. New leases and lease mandate passes to the Custodian Bank will continue after the extensions for a total space of 139,189 m² (about 25.2 % of management mandate has passed from the capital investment the total rental space of the Fund as at the reporting date) and asset management company (CREDIT SUISSE ASSET could be concluded so that the moving out of tenants could be MANAGEMENT Immobilien Kapitalanlagegesellschaft mbH) to more than compensated. Due consideration must also be given

5 There are no currency effects included in the valuation result.

34 Report by Fund Management to the fact that the properties sold in the financial year • Interest Rate Risks 2015/2016 had, on balance, a below-average letting level, Such risks generally lie in the danger of a worsening of the which had an additional positive effect on the average letting income and asset position due to a change in the interest level of the remaining properties. The rental income situation rates. however remained relatively stable. Solvent tenants with a good credit rating could be bound for the medium and long The interest rates in the capital market are currently still at an term during the reporting period and this is evidenced by the exceptionally low and sometimes even negative level. To fact that 66.8 % of the leases have a term beyond 2019 secure the on-going management of the Fund and to make (including time-unlimited leases; as at 30 September 2016) dividend payments to investors possible, the liquid investments and thus generate long-term and sustainable income for the of the Fund were invested on a short-term basis and could Fund. Furthermore, the majority of leases are linked to a therefore only be invested at very low interest rates anyway. A standard of living index which takes into account the general negative interest rate for the liquid assets could nevertheless price development and thus tend to achieve an inflation protec- largely be avoided in the reporting period. However, we could tion. no longer avoid the general conditions in terms of capital market interest rates for our CS EUROREAL fund either. As The improved market situation in The Netherlands was the investments in the reporting period were made exclusively exploited in March 2016 to sell nine Dutch properties of the in the form of cash at bank and fixed-term deposits, the CS EUROREAL fund as part of a larger portfolio of Dutch interest rate risk was mainly due to this investment type and properties. Together with five Dutch properties held by the can therefore be regarded as being moderate. The continuing CS PROPERTY DYNAMIC fund, which is also managed by us, low and sometimes even negative interest rate was the cause the package included a total of 14 properties. The portfolio for the generally low interest income of the Fund during the was sold within the scope of an international bidding process. reporting period. Negative interest rates have been charged on A purchase price confidentiality agreement was signed. The the investment of cash at bank held in current accounts since Fund‘s vacancy level could be reduced as a result of the sale. 1 August 2016. Fund Management invested liquid funds that The selling price for the portfolio was above the sum of the last were not needed in the short term in fixed-term deposits that determined market values. accrued no negative interest wherever possible during the reporting period. Against the backdrop of the current capital market environment, it cannot be excluded that a negative interest rate will have to be accepted in future for the investment of liquid funds of the Fund in fixed-term deposits.

Report by Fund Management 35 However, potential future inflationary trends that could the CHF unit class as at 30 September 2015). The risk is influence current interest rates make it apparent that the future minimised by currency hedging transactions. The statutory income and expense structure of the Fund continues to have a requirement is a protection level of at least 70 %. The conflict element. CS EUROREAL fund strives for a far-reaching protection against foreign currency risks. On the reporting date, foreign The Fund continues to pursue a conservative investment currency items of the Fund amounted to EUR 93.8 million strategy in respect of the debt ratio. The two remaining mort- (4.3 % of the Fund‘s net assets). The hedging level of the gage loans totalling EUR 115.0 million (5.1 % of the property foreign currency items amounted to 89.2 % of the Fund‘s net assets) were repaid during the financial year 2015/2016 of volume of the currency regions, i.e. Great Britain, Sweden and the CS EUROREAL fund so that the Fund is now completely the Czech Republic (see ‚Currency Risks as at the Reporting free from debt. Date‘ table on page 46 of this Annual Report). In terms of the Fund‘s net assets of the respective unit class of the • Foreign Currency Risks CS EUROREAL fund as at the reporting date, the hedging Foreign currency risks describe the danger that items denomi- level of the EUR unit class of the CS EUROREAL fund was nated in foreign currency (e.g. accounts receivable, liabilities, 99.5 % and the hedging level of the CHF unit class was securities or derivative positions/structured products with 99.7 %. The resulting foreign currency risk had no significant similar risk) suffer an asset loss due to an unfavourable effect on the Fund‘s performance in the reporting period. development of the exchange rate (of the relevant currency compared to the Fund‘s currency). According to the Sales Prospectus, hedging transactions must be concluded for more than half of the Fund‘s assets that are A part of the Fund‘s assets is subject to a foreign currency risk mathematically allocated to the unit class in Swiss Francs. The because the CS EUROREAL fund also invests in countries relevant hedging level was 89.4 % as at 30 September 2016. outside of the Euro region. The foreign currency percentage of the EUR unit class of the Fund on the reporting date, • Liquidity Risks 30 September 2016, was 4.4 % of the Fund‘s net assets of Liquidity risk means the risk that taken-on liabilities cannot be the EUR unit class (EUR 89.8 million) (CHF unit class of the fulfilled when they are due because asset items cannot be Fund: 3.0 % of the Fund‘s net assets of the CHF unit class liquidated or adequate funds cannot be made available. A (EUR 4.0 million)) and has thus hardly changed compared to liquidity risk can also result if special market positions cannot be the end of the previous financial year 2014/2015 (4.3 % for liquidated without much lower market prices due to a lacking the EUR unit class as at 30 September 2015 and 3.1 % for market depth or due to market disruption (‚market liquidity risk’).

8 The dividend of the CHF unit class of the CS EUROREAL fund was converted to EUR using the foreign exchange rate of 1 EUR = 1.084100 Swiss Francs (CHF) applicable on 26 July 2016. 10 The dividend of the CHF unit class of the CS EUROREAL fund was converted to EUR using the foreign exchange rate of 1 EUR = 1.099724 Swiss Francs (CHF) applicable on 26 January 2016.

36 Report by Fund Management The liquidity situation of the CS EUROREAL fund during the • Unit Redemption Risks financial year 2015/2016 was marked by the continuation of The unit redemption risk results from the inability to fulfil the liquidation process of the Fund initiated on 21 May 2012, payment obligations towards unitholders upon unit redemption. the further distribution of the Fund‘s capital to the investors This risk can arise from unit redemption by investors to an and the planned repayment of the loans. The year-end dividend extent that it causes a shortage in the liquid assets of the payment/capital repayment for the previous financial year Fund. In the event that liquid assets are no longer sufficient for 2014/2015 was made within the financial year 2015/2016, the payment of the redemption price and for ensuring a proper namely on 26 January 2016, and amounted to EUR 187.9 management of the fund, the capital investment and asset million10, and the interim dividend amounting to EUR 309.1 management company managing the fund must suspend the million8 for the financial year 2015/2016 was paid out on redemption of units for a maximum period of two years in order 26 July 2016. The gross liquidity reduced from EUR 524.4 to obtain the necessary liquidity. million as at the beginning of the financial year, 30 September 2015, to EUR 294.2 million as at the end of the financial year, A reopening of the CS EUROREAL fund was not possible in 30 September 2016. The main reasons for the reduction in the period of the redemption suspension between 19 May gross liquidity were the distributions on 26 January 2016 and 2010 and 21 May 2012 and we, CREDIT SUISSE ASSET 26 July 2016 and the repayment of loans, namely EUR 90.0 MANAGEMENT Immobilien Kapitalanlagegesellschaft mbH, million for the ‚Rathaus-Galerie‘ property at Friedrich-Ebert- therefore had to give notice to terminate the management of Platz 1-2 in Leverkusen and EUR 25.0 million for the property the Fund on 21 May 2012 to take effect on 30 April 2017, at Orteliuslaan 750, Utrecht (The Netherlands). permanently stop the issue and redemption of units and initiate the controlled liquidation of the Fund. Upon expiry of the notice The liquidity situation of the Fund is very good as at the report- period on 30 April 2017, the Fund will automatically pass, if ing date. There were only theoretical liquidity risks in the entire applicable with incurred Land Transfer Tax for the foreign reporting period. As of 30 September 2016, there has been properties, to the Custodian Bank which will then continue the no liquidity risk from loans becoming due and adequate risk controlled liquidation of the Fund. provisions were made for contingent liabilities. There was no unit redemption risk in the reporting year because of the permanent suspension of unit redemption existing in the same period.

Report by Fund Management 37 • Property Risks • Maintenance Risks These risks describe the risks associated with the properties. These risks result from the uncertainty about the amount of the They can be divided into letting risks and maintenance risks. costs of the necessary maintenance measures and the time when they are necessary (e.g. on re-letting). This applies for • Letting Risks existing portfolio properties and theoretically also for property Letting risks are risks resulting from the re-letting problems or purchases. The risk is that an incorrectly estimated level of the sudden insolvency of tenants. incurred costs can result in higher management costs and affect the expense and income situation of the Fund. On the As at 30 September 2016, the percentage of leases expiring other hand, a neglected maintenance results in a lesser attrac- by the end of 2016 was 3.2 % of the annual net target rent tiveness of the property, which in turn can result in a value and the percentage of leases expiring by the end of 2017 reduction or even in an impossibility of property use. totals 11.5 % of the annual net target rent. An active property asset management allowed lease extensions and new leases The maintenance costs per property are generally budgeted at for a total of 139,189 m² of space (about 25.2 % of the total the start of a financial year and subject to permanent control letting space of the Fund as at the reporting date). The risk through budget monitoring during the year. posed by expiring leases within the next three years can be rated as moderate. The total vacancy level of the Fund reduced • Portfolio Strategy Risks in the reporting period from 14.8 % as at 30 September 2015 The main portfolio strategy risks result from concentration to 14.5 % as at the reporting date 30 September 2016. The appearances at the property, portfolio or overall Fund level. The average letting level in the reporting period was 85.2 %. The Fund has also a cluster risk in terms of usage types of the letting and vacancy levels therefore remained at an overall properties in the Fund‘s property portfolio because there was a acceptable level in a market comparison. This risk can there- high percentage of retail properties (54.6 % as at 30 September fore be rated as moderate in the entire reporting period. For 2016) and office properties (35.1 % as at 30 September the future development, it must be taken into account that the 2016). At the tenant level, the CS EUROEAL fund was broadly rental income and the tenant diversification will reduce more diversified during the entire reporting period and thus also as at and more because of the gradual sale of the property portfolio 30 September 2016 and did not have any significant cluster in and that the letting level can therefore be subject to higher terms of tenant sector. In terms of geographical diversification, fluctuations. the Fund has a relatively high concentration on Germany (49.2 % of the market value volume), and Italy (19.0 % of the The increased rent dispute level identified in the portfolio is market value volume). The percentages of the two mentioned being intensively dealt with by the Asset Management depart- countries increased due to sales in other countries during the ment and external service providers. reporting period. Properties were primarily sold in The Nether- lands and that is also the reason why the percentage for The Netherlands reduced substantially. The percentage for The

38 Report by Fund Management Netherlands (21.0 % of the market value volume as at options will be transferred to the Custodian Bank. All possibili- 30 September 2015) reduced by 11.3 percentage points to ties of keeping the transfer costs (amongst others the land 9.7 % due to the sale of nine properties in the Amsterdam transfer tax) for the properties that pass to the Custodian Bank area, The Hague, Rotterdam and Utrecht during the reporting to a minimum will be exploited by selecting appropriate tax period. The concentration tendency on Germany had however planning scheme options for the property transfer and/or a positive effect on the Fund in the reporting period because of negotiating with local tax authorities. the macro-economically relatively stable development in Germany , particularly due to consumer behaviour. The increased rent • Operational Risks dispute level identified in the portfolio is being intensively dealt We, CREDIT SUISSE ASSET MANAGEMENT Immobilien with by the Asset Management department and external Kapitalanlagegesellschaft mbH, have implemented the measures service providers. necessary to reduce the operational risks to a reasonable level.

Increasing concentrations will occur in the future as a result of The risks enumerated here represent only a selection of the property sales due to the liquidation of the Fund initiated on risks of an investment in an open-ended real estate investment 21 May 2012. fund, like the CS EUROREAL fund, and do not represent a complete enumeration. Please refer to the Sales Prospectus of • T ax Risks in Connection with the Transfer of the Fund the CS EUROREAL fund for a detailed description of the risks to the Custodian Bank of a property investment. As at the reporting date, the CS EUROREAL fund still had 32 properties with a total value of EUR 1,884.3 million (market The following points should also be mentioned here because value volume incl. projects stated at market value) in eleven the Fund has been in the liquidation phase since 21 May European countries. As the law stands pursuant to the new 2012. The sale of properties can result in an imbalance of the Articles 100a and 357 of the German Capital Investment Code Fund’s portfolio. There is particularly the risk that properties (KAGB), properties in Germany will be exempt from land transfer can only be sold below their actual market values in the liquida- tax upon transfer from the Capital Investment and Asset tion phase and that the Fund can be burdened with Land Management Company to the Custodian Bank so that no land Transfer Tax for the foreign properties upon transfer to the transfer tax will be incurred for properties in Germany even if Custodian Bank unless all of the Fund’s properties can be sold they remain unsold and have to be transferred to the Custodian before the expiry of the notice period of termination on 30 April Bank. It can currently not be assessed if and to which extent 2017. The Fund will continue to retain liquid funds even after land transfer tax is payable for foreign properties. If foreign the sale of the last property in order to be able to cover any properties pass to the Custodian Bank upon expiry of our liabilities and risks. Imbalances within the individual risk types management mandate, the amount of any payable land transfer can also occur as a result of the liquidation. tax will especially depend on which properties, with which volume, in which country, and with which tax planning scheme

Report by Fund Management 39 Outlook In respect of the remaining 32 properties of the Fund with a The further increased demand for properties as a result of the total value of about EUR 1.9 billion as at the reporting date, we low interest rate and the improved overall situation has a are continuing to work intensively on the demanding task of tendentiously positive effect on the planned sale of further selling all of these properties at reasonable prices. In the properties of the Fund. Although the investors‘ main interest remaining period of about 7 months from the reporting date to continues to be focused on well-let quality properties in the the expiry of our management mandate we will continue to metropolises of Germany and established retail properties, pursue the liquidation strategy that serves as a basis for the investors are also starting to increasingly select other market further selling process for the properties of the Fund and segments because of the increased prices in the aforemen- particularly takes into account property-specific situations. tioned market segments. In the economically strong countries, investors are again showing an interest in properties outside of In our selling efforts to date, we have progressed in accord- the central business districts of the metropolises and in good ance with our strategy. The selling process was extended to locations in regional cities. Opportunistic investors who are include further properties and we are confident that we will be looking for properties with a value that can be increased by able to conclude further contracts of sale in the next few asset management measures are also important transaction months. Talks concerning individual property and portfolio sales turnover boosters. There is also an increasing demand again covering a total volume of about EUR 1 billion are currently for quality properties in the centres of Southern European being held with potential buyers. Negotiations for the sale of markets that have been ignored for a long time. The individual smaller properties are already at an advanced stage. CS EUROREAL fund is therefore well positioned not only due A high-volume transaction covering several retail properties to the described market developments but also because it could be notarised shortly after the end of the reporting period continues to have a high percentage of properties in Germany and the transfer of ownership is scheduled for the beginning of and a high percentage of retail properties. The Fund will also 2017. As already mentioned above, further properties in benefit from the evolving improved market situation for proper- Stockholm, Vienna, Amsterdam and Berlin were sold after the ties in the outer suburbs of the metropolises, in regional cities end of the reporting period. Furthermore, a large number of and in Southern Europe. We are therefore able to start sales further properties of the Fund are being prepared for sale. negotiations for more properties and market segments.

40 Outlook On the other hand, the special selling situation in Germany with end of the financial year, 30 September 2016. It is however many open-ended real estate funds in liquidation and other currently envisaged to make an extraordinary distribution of open-ended real estate funds that want to sell properties on liquid funds received from the sale of properties before the the market because of a redemption suspension or a self- transfer of the management mandate to the Custodian Bank selected liquidation strategy represents a great challenge for provided that such are not needed as liquidity for the proper our efforts to sell further properties. The additional supply of further management of the Fund. The Custodian Bank, properties and the knowledge of potential buyers about our Commerzbank AG, will pass a resolution on the amount and obligation to sell, if possible, all the properties of the Fund put payment of the periodic first interim dividend for the financial a certain pressure on the marketing and pricing. year 2016/2017 after the expiry of our management mandate.

As the development of both the national economies and the After the expiry of our notice period of termination of the financial and property markets cannot be predicted because of CS EUROREAL fund on 30 April 2017, 24:00 hrs., the their complexity and dynamism, we are currently unable to management mandate for Fund will be transferred, together predict which results the property sales will bring before the with any remaining assets (e.g. properties, liquid funds), to the end of our management mandate on 30 April 2017. It is there- Custodian Bank of the Fund, Commerzbank AG in Frankfurt fore not possible to forecast how high the next scheduled am Main in accordance with Article 39 (1) of the German dividends and the overall investment success during the Fund‘s Investment Act (InvG). Land Transfer Tax on foreign properties liquidation will be. We still assume that some properties of the may then be incurred. The Custodian Bank will thereafter be Fund will be transferred to the Custodian Bank, which will then responsible for the liquidation of the Fund. continue the controlled liquidation of the Fund. The Custodian Bank is obliged by law to continue the liquida- As already explained, there will be no year-end dividend tion of the Fund and to distribute any available liquid funds to payment in January 2017 because adequate risk provisions for the investors. The Custodian Bank must especially offer the contingent liabilities for the financial year 2015/2016 are remaining properties for sale. It must be noted that adequate needed. The Fund‘s income was instead reinvested as at the liquid funds must be provided by the Fund not only for the

Outlook 41 management of the Fund‘s remaining properties, other assets We will continue to be responsible for the reporting and the and liabilities but also for the continued proper management of information on the further development of the CS EUROREAL the Fund for liabilities arising from the already completed sale fund until 30 April 2017 inclusive. We will keep you informed of properties, and, for the remaining unsold properties, for about the current status of the Fund‘s liquidation by means of example, for letting, maintenance and conversion measures to our monthly factsheets and further issues of our ‚CS EURO- retain or increase their attractiveness and to achieve the best REAL Bulletin’ newsletter. We will also prepare a Liquidation possible selling price. A reasonable liquidity level must also be Report as at 30 April 2017. You will find the essential informa- available because some payments from the completed sale of tion for the period until the expiry of our management mandate properties such as tax on gains on sale of foreign properties, on our website at www.cseuroreal.de until further notice. any potential warranty claims or any guarantees given for rental income and construction costs within the scope of such sales The Custodian Bank, Commerzbank AG, will take over are often incurred long after the signing of the contract of sale communication with the investors and sales partners of the and the final amount of all involved payments can only be CS EUROREAL fund as of 1 May 2017. determined long after the sale. The future investment success and the time when the last payment will be made to the We will continue to do our utmost to achieve reasonable sales investors cannot be estimated at this point in time. results for the investors during the liquidation of the CS EURO- REAL fund. The Custodian Bank (Commerzbank AG) intends to delegate important tasks such as the management and the sale of the remaining properties and the Fund‘s administration (e.g. Fund Frankfurt am Main, 9 January 2017 accounting) to us, CREDIT SUISSE ASSET MANAGEMENT Immobilien KAG mbH, as service provider after the transfer of Yours faithfully, the management mandate for the CS EUROREAL fund. This CREDIT SUISSE ASSET MANAGEMENT means that we will probably be in a position to contribute our Immobilien Kapitalanlagegesellschaft mbH existing know-how and our information on the individual properties to, and co-operate in, the achievement of the best possible result in the Fund‘s liquidation for the investors. However, all essential decisions will be made by the Custodian Bank who will then be responsible for the Fund‘s liquidation. Frank Schäfer Karl-Josef Schneiders

42 Outlook Property photograph: Lisbon (Portugal), Avenida Dom João II Iote 1.18, ‚Art‘s Building‘ 43 Overview: Yields, Valuation, Letting

Yield figures in % Total The direct Germany Great Britain Belgium Italy Netherlands France Portugal Spain Austria investment Holdings5 Total I. Properties Gross yield1 5.5 7.6 7.5 11.9 6.6 3.4 7.0 2.2 9.4 5.9 6.5 6.1 Management expenses1 -3.6 -3.3 -2.6 -3.6 -1.7 -3.3 -2.2 -1.7 -3.4 -3.0 -1.5 -2.6 Net yield1 1.9 4.3 4.9 8.3 4.9 0.1 4.8 0.5 6.0 2.9 5.0 3.5 Value changes according to valuation report1 -0.4 -4.8 -12.5 -19.5 -1.4 -2.1 0.8 -24.2 -3.7 -1.9 -0.7 -1.6 Foreign tax on profit1 0.0 0.5 0.0 -8.1 -0.1 0.0 -0.8 -0.1 0.0 -0.2 -0.1 -0.1 Foreign deferred tax on profit1 0.0 0.0 2.8 -0.2 0.0 0.7 -0.2 0.0 0.0 0.1 -0.5 -0.1 Result before loan expenses1 1.5 0.0 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.9 3.7 1.7 Result after loan expenses in currency2 1.5 0.0 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.8 3.7 1.7 Currency change2 0.0 -3.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 -0.2 0.0 -0.1 Total result in Fund’s currency2 1.5 -3.5 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.6 3.7 1.6 II. Liquidity Liquidity yield3 0.9 III. Fund yield Result of the entire Fund before Fund’s expenses4 1.4

Result of CS EUROREAL (EUR) after Fund’s expenses (BVI method) 0.5 Result of CS EUROREAL (CHF) after Fund’s expenses (BVI method) -0.3

Capital information Total (average figures in 1,000 EUR) The direct Germany Great Britain Belgium Italy Netherlands France Portugal Spain Austria investment Holdings Total Properties held directly 742,344 80,569 9,170 17,591 311,213 91,265 88,673 38,437 17,705 1,396,967 – 1,396,967 Properties held via property companies – – – – – – – – – – 611,441 611,441 Total properties 742,344 80,569 9,170 17,591 311,213 91,265 88,673 38,437 17,705 1,396,967 611,441 2,008,408 Liquidity 406,016 2,415 269 2,014 2,648 3,265 869 583 781 418,860 69,839 488,699 Loans volume 0 0 0 0 13,462 0 0 0 0 13,462 13,846 27,308 Fund’s volume (net) 1,148,360 82,984 9,439 19,605 300,399 94,530 89,542 39,020 18,486 1,802,365 667,434 2,469,799

Value changes (in 1,000 EUR) Total The direct Germany Great Britain Belgium Italy Netherlands France Portugal Spain Austria investment Holdings Total Assessed market value as at 30.09.20166 496,380 73,424 10,610 25,920 182,820 97,490 89,600 30,240 18,050 1,024,534 645,281 1,669,815 Assessed rent portfolio as at 30.09.20166 33,311 5,909 901 1,925 11,182 7,147 6,304 2,303 1,334 70,316 41,076 111,392 Positive value changes according to valuation 100 0 0 0 0 0 710 0 0 810 10,612 11,422 Other positive value changes 0 211 261 0 117 606 0 0 0 1,195 2,098 3,293 Negative value changes according to valuation 12,700 4,565 1,290 630 6,330 6,630 0 9,360 650 42,155 15,000 57,155 Other negative changes 1,348 0 0 44 3,467 416 198 0 0 5,473 2,311 7,784 Total value changes according to valuation -12,600 -4,565 -1,290 -630 -6,330 -6,630 710 -9,360 -650 -41,345 -4,388 -45,733 Total other value changes -1,348 211 261 -44 -3,350 190 -198 0 0 -4,278 -213 -4,491

1 Based on the average property assets of the financial year 2015/2016. 2 Based on the average equity financed property assets of the financial year 2015/2016. 3 Based on the average liquid assets of the financial year 2015/2016. 4 Based on the average Fund‘s volume of the financial year 2015/2016.

44 Overview: Yields, Valuation, Letting Yield figures in % Total The direct Germany Great Britain Belgium Italy Netherlands France Portugal Spain Austria investment Holdings5 Total I. Properties Gross yield1 5.5 7.6 7.5 11.9 6.6 3.4 7.0 2.2 9.4 5.9 6.5 6.1 Management expenses1 -3.6 -3.3 -2.6 -3.6 -1.7 -3.3 -2.2 -1.7 -3.4 -3.0 -1.5 -2.6 Net yield1 1.9 4.3 4.9 8.3 4.9 0.1 4.8 0.5 6.0 2.9 5.0 3.5 Value changes according to valuation report1 -0.4 -4.8 -12.5 -19.5 -1.4 -2.1 0.8 -24.2 -3.7 -1.9 -0.7 -1.6 Foreign tax on profit1 0.0 0.5 0.0 -8.1 -0.1 0.0 -0.8 -0.1 0.0 -0.2 -0.1 -0.1 Foreign deferred tax on profit1 0.0 0.0 2.8 -0.2 0.0 0.7 -0.2 0.0 0.0 0.1 -0.5 -0.1 Result before loan expenses1 1.5 0.0 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.9 3.7 1.7 Result after loan expenses in currency2 1.5 0.0 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.8 3.7 1.7 Currency change2 0.0 -3.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 -0.2 0.0 -0.1 Total result in Fund’s currency2 1.5 -3.5 -4.8 -19.5 3.4 -1.3 4.6 -23.8 2.3 0.6 3.7 1.6 II. Liquidity Liquidity yield3 0.9 III. Fund yield Result of the entire Fund before Fund’s expenses4 1.4

Result of CS EUROREAL (EUR) after Fund’s expenses (BVI method) 0.5 Result of CS EUROREAL (CHF) after Fund’s expenses (BVI method) -0.3

5 Based on properties held through property companies. 6 Properties under construction were not included.

Overview: Yields, Valuation, Letting 45 Overview Loans Loans volume in % of the Loans volume Remaining (direct) market value (indirect via in % of the term of the of all net real property- market value of fixed-interest estate Fund‘s companies) all real estate period in 1,000 EUR assets in 1,000 EUR Fund‘s assets Loans in EUR for property in Germany 0 0.0 0 0.0 0-1 year 0 0.0 0 0.0 1-2 years 0 0.0 0 0.0 2-5 years 0 0.0 0 0.0 5-10 years 0 0.0 0 0.0 10+ years 0 0.0 0 0.0 Loans in EUR for property abroad 0 0.0 0 0.0 0-1 year 0 0.0 0 0.0 1-2 years 0 0.0 0 0.0 2-5 years 0 0.0 0 0.0 5-10 years 0 0.0 0 0.0 10+ years 0 0.0 0 0.0 Loans in GBP for property abroad 0 0.0 0 0.0 0-1 years 0 0.0 0 0.0 1-2 years 0 0.0 0 0.0 2-5 years 0 0.0 0 0.0 5-10 years 0 0.0 0 0.0 10+ years 0 0.0 0 0.0 Loans in SEK for property abroad 0 0.0 0 0.0 0-1 year 0 0.0 0 0.0 1-2 years 0 0.0 0 0.0 2-5 years 0 0.0 0 0.0 5-10 years 0 0.0 0 0.0 10+ years 0 0.0 0 0.0 Total 0 0.0 0 0.0

Currency risk as at reporting date Open positions Open positions % of the Fund‘s net volume in foreign currency in EUR in foreign currency GBP 1,016,687 1,177,062 1.8 SEK 13,443,708 1,396,060 7.3 CZK 203,578,802 7,533,538 100.0 Total 10,106,660 10.8

46 Overview: Yields, Valuation, Letting Letting Information – Annual Net Rent Yield1 Office Retail/ Hotel Ware- Residen- Leisure Garages/ Other Catering house/ tial Parking Logistics Spaces Germany in % 12.4 76.3 0.0 3.3 0.0 0.0 7.0 1.0 Great Britain in % 95.7 0.0 0.0 0.0 0.0 0.0 3.9 0.4 Belgium in % 79.0 0.0 0.0 2.2 0.0 0.0 18.8 0.0 Italy in % 90.9 0.0 0.0 0.8 0.0 0.0 4.6 3.7 The Netherlands in % 85.8 2.9 0.0 0.0 0.0 0.0 9.0 2.3 France in % 80.6 3.0 0.0 0.0 0.0 0.0 15.7 0.7 Portugal in % 84.9 4.8 0.0 0.0 0.0 0.0 10.3 0.0 Spain in % 45.3 8.3 29.3 0.0 0.0 0.0 16.1 1.0 Austria in % 80.5 2.6 0.0 14.4 0.0 0.0 0.6 1.9 Total direct investment in % 51.8 35.6 1.2 1.8 0.0 0.0 8.5 1.1 Holdings in % 4.7 89.1 0.0 0.5 0.0 2.9 1.5 1.3 Portfolio total in % 35.1 54.6 0.7 1.4 0.0 1.0 6.0 1.2

1 based on annual net target rent as at 30 September 2016

Letting Information Vacancies2 Office Retail/ Hotel Ware- Residen- Leisure Garages/ Other Lease Catering house/ tial Parking rate Logistics Spaces Germany in % 4.2 8.9 0.0 0.9 0.0 0.0 0.6 0.4 85.0 Great Britain in % 41.9 0.0 0.0 0.0 0.0 0.0 2.3 0.0 55.8 Belgium in % 22.6 0.0 0.0 0.6 0.0 0.0 5.0 0.0 71.8 Italy in % 8.3 0.0 0.0 0.0 0.0 0.0 0.4 3.7 87.5 The Netherlands in % 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 France in % 48.8 0.0 0.0 0.0 0.0 0.0 11.5 0.0 39.7 Portugal in % 0.6 0.5 0.0 0.0 0.0 0.0 2.5 0.0 96.4 Spain in % 30.7 5.8 0.0 0.0 0.0 0.0 12.0 0.0 51.5 Austria in % 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.0 Total direct investment in % 12.1 5.1 0.0 0.4 0.0 0.0 2.0 0.2 80.2 Holdings in % 0.1 5.3 0.0 0.1 0.0 0.0 0.0 0.1 94.4 Portfolio total in % 8.1 4.6 0.0 0.3 0.0 0.0 1.3 0.2 85.5

2 based on gross target rent as at 30 September 2016

Overview: Yields, Valuation, Letting 47 Residual Term Structure of the Leases of the Fund's Properties (Basis: Annual net target rent)

24 %

21.0 %

20 %

16 %

12 % 11.7 % 10.9 % 10.8 % 10.7 %

8% 8.3 % 7.1 % 5.8 % 4.7 % 4% 3.2 % 3.7 %

2.1 %

0% Lease end Lease end Lease end Lease end Lease end Lease end Lease end Lease end Lease end Lease end Lease end Unlimited 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026+

Residual Term of the Leases of the Fund’s Properties (Basis: Annual net target rent)

Residual Term (Lease end) un- in in in in in in in in in in limted 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026+ Germany in % 6.2 3.6 4.1 15.1 13.0 1.7 8.6 1.7 2.6 8.3 12.2 22.9 Great Britain in % 0.0 11.7 0.0 0.0 0.0 76.2 0.0 12.1 0.0 0.0 0.0 0.0 Belgium in % 0.0 0.0 4.9 0.0 54.7 40.4 0.0 0.0 0.0 0.0 0.0 0.0 Italy in % 0.0 62.6 28.3 0.0 6.7 0.0 2.4 0.0 0.0 0.0 0.0 0.0 The Netherlands in % 0.0 0.0 0.0 30.2 0.0 0.0 22.8 0.0 21.6 0.0 0.0 25.4 France in % 0.0 0.0 0.0 6.1 13.5 23.2 25.9 0.0 23.1 2.1 6.1 0.0 Portugal in % 0.0 2.7 11.0 4.3 2.6 27.3 6.7 0.0 0.0 45.4 0.0 0.0 Spain in % 0.3 0.0 14.9 2.4 0.0 18.1 61.8 0.0 0.0 2.5 0.0 0.0 Austria in % 0.6 0.0 99.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other foreign countries in % 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Total direct investments in % 3.0 4.9 7.3 14.0 8.0 11.2 12.2 1.6 6.5 9.3 6.1 15.9

Total holdings in % 0.9 0.6 9.8 6.4 14.9 35.8 8.4 6.7 2.0 0.6 8.5 5.4

Portfolio total in % 2.1 3.2 8.3 10.9 10.8 21.0 10.7 3.7 4.7 5.8 7.1 11.7

48 Overview: Yields, Valuation, Letting Property photograph: Frankfurt am Main (Germany), Taunusanlage 8, ‚T8‘ 49 Consolidated Statement of the Fund’s Assets as at 30 September 2016, Part 1

Total Percentage Unit class EUR Unit class CHF Unit class CHF Fund (%) of the EUR EUR EUR Fund’s Assets EUR EUR CHF I. Properties (see page 56 ff.) 1. Commercial properties 1,024,534,023.16 46.9 981,136,937.00 43,397,086.16 46,977,345.77 (thereof in foreign currency1 73,424,023.16) 2. Property under construction 206,582,990.47 9.5 197,832,573.59 8,750,416.88 9,472,326.27 (thereof in foreign currency1 0.00) (total in foreign currency1 73,424,023.16) 1,231,117,013.63 56.3

II. Holdings in property companies 1. Majority holdings 445,585,593.36 20.4 426,711,533.62 18,874,059.74 20,431,169.67 (thereof in foreign currency1 11,001,672.80)

III. Liquid investments 1. Cash at bank falling due within one year 294,199,362.35 281,737,702.10 12,461,660.25 13,489,747.22 (thereof in foreign currency1 2,115,820.50) 13.5

IV. Other assets 1. Receivables from property management 22,834,966.54 1.0 21,867,726.26 967,240.28 1,047,037.60 (thereof in foreign currency1 -368,660.56) 2. Receivables from property companies 275,503,726.73 12.7 263,833,973.75 11,669,752.98 12,632,507.60 (thereof in foreign currency1 9,553,726.23) 3. Entitlements to interest 0.00 0.0 -0.01 0.01 0.01 (thereof in foreign currency1 0.00) 4. Other assets 93,117,786.75 4.3 50,965,901.32 42,151,885.43 45,629,415.98 (thereof in foreign currency1 506,795.09) 391,456,480.02 17.9

Total 2,362,358,449.36 108.1 2,224,086,347.63 138,272,101.73 149,679,550.12

V. Liabilities from 1. Loans 0.00 0.0 0.00 0.00 0.00 (thereof secured loans pursuant to Art. 82 (3) InvG 0.00) (thereof in foreign currency1 0.00) 2. Property purchases and development projects 801,439.68 0.0 767,492.41 33,947.27 36,747.92 (thereof in foreign currency1 694,359.35) 3. Property management 25,502,503.94 1.2 24,422,271.59 1,080,232.35 1,169,351.52 (thereof in foreign currency1 2,921,213.78) 4. Other reasons 16,256,585.83 0.7 15,567,991.41 688,594.42 745,403.46 (thereof in foreign currency1 194,552.64) 42,560,529.45 1.9

VI. Provisions 134,611,814.29 6.2 128,909,943.52 5,701,870.77 6,172,275.11 (thereof in foreign currency1 4,483,320.57)

Total 177,172,343.74 8.1 169,667,698.93 7,504,644.81 8,123,778.01

Fund’s assets 2,185,186,105.62 100.0 2,054,418,648.70 130,767,456.92 141,555,772.11

1 ‘Foreign currency’ means all non-Euro positions (here only GBP and SEK).

50 Consolidated Statement of the Fund’s Assets Total Percentage Unit class EUR Unit class CHF Unit class CHF Fund (%) of the EUR EUR EUR Fund’s Assets EUR EUR CHF I. Properties (see page 56 ff.) 1. Commercial properties 1,024,534,023.16 46.9 981,136,937.00 43,397,086.16 46,977,345.77 (thereof in foreign currency1 73,424,023.16) 2. Property under construction 206,582,990.47 9.5 197,832,573.59 8,750,416.88 9,472,326.27 (thereof in foreign currency1 0.00) (total in foreign currency1 73,424,023.16) 1,231,117,013.63 56.3

II. Holdings in property companies 1. Majority holdings 445,585,593.36 20.4 426,711,533.62 18,874,059.74 20,431,169.67 (thereof in foreign currency1 11,001,672.80)

III. Liquid investments 1. Cash at bank falling due within one year 294,199,362.35 281,737,702.10 12,461,660.25 13,489,747.22 (thereof in foreign currency1 2,115,820.50) 13.5

Total 2,362,358,449.36 108.1 2,224,086,347.63 138,272,101.73 149,679,550.12

VI. Provisions 134,611,814.29 6.2 128,909,943.52 5,701,870.77 6,172,275.11 (thereof in foreign currency1 4,483,320.57)

Total 177,172,343.74 8.1 169,667,698.93 7,504,644.81 8,123,778.01

Fund’s assets 2,185,186,105.62 100.0 2,054,418,648.70 130,767,456.92 141,555,772.11

1 ‘Foreign currency’ means all non-Euro positions (here only GBP and SEK).

Consolidated Statement of the Fund’s Assets 51 Consolidated Statement of the Fund’s Assets as at 30 September 2016, Part 2 Geographical distribution

Germany Great Britain Belgium Italy The Netherlands France Portugal Spain Sweden Austria Czech Republic2 I. Properties (see page 56 ff.) 1. Commercial properties 496,380,000.00 73,424,023.16 10,610,000.00 25,920,000.00 182,820,000.00 97,490,000.00 89,600,000.00 30,240,000.00 0.00 18,050,000.00 0.00

2. Property under construction 206,582,990.47 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

II. Holdings in property companies 1. Majority holdings 143,106,174.87 0.00 0.00 234,920,670.13 0.00 0.00 0.00 0.00 11,001,672.80 0.00 56,557,075.56

III. Liquid investments 1. Cash at bank falling due within one year 266,475,325.37 3,450,571.27 481,465.72 5,825,549.72 6,126,453.43 7,461,443.57 1,717,340.65 988,112.26 80,709.24 1,592,391.12 0.00

IV. Other assets 1. Receivables from property management 14,384,869.47 -368,660.56 146,267.80 498,521.42 2,799,143.15 3,683,979.52 1,148,147.88 185,148.15 0.00 357,549.71 0.00

2. Receivables from property companies 90,000,000.00 0.00 0.00 137,600,000.00 0.00 0.00 0.00 0.00 9,553,726.73 0.00 38,350,000.00

3. Entitlements to interest 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

4. Other assets 85,157,577.62 492,809.35 108,000.00 1,152,045.13 5,445,085.85 100,448.03 6,910.00 628,902.65 13,985.74 12,022.38 0.00

Total 1,302,086,937.80 76,998,743.22 11,345,733.52 405,916,786.40 197,190,682.43 108,735,871.12 92,472,398.53 32,042,163.06 20,650,094.51 20,011,963.21 94,907,075.56

V. Liabilities from 1. Loans 0.00 0.01 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

2. Property purchases and development projects 0.00 347,322.72 0.00 53,333.32 0.00 0.00 53,747.00 0.00 347,036.63 0.00 0.00

3. Property management 10,224,451.32 2,921,213.78 109,710.66 677,848.31 6,592,535.12 3,644,447.96 446,154.11 165,956.48 0.00 720,186.20 0.00

4. Other reasons 12,602,714.50 194,552.64 4,646.94 3,182,107.44 201.40 153,092.14 30,250.63 27,653.04 0.00 61,367.10 0.00

VI. Provisions 40,162,570.37 3,229,778.67 1,844,254.22 38,315,356.38 34,096,613.83 6,636,570.89 897,588.07 230,734.19 1,253,541.90 673,577.67 7,271,228.10

Total 62,989,736.19 6,692,867.82 1,958,611.82 42,228,645.45 40,689,350.35 10,434,110.99 1,427,739.81 424,343.71 1,600,578.53 1,455,130.97 7,271,228.10

Fund’s assets 1,239,097,201.61 70,305,875.40 9,387,121.70 363,688,140.95 156,501,332.08 98,301,760.13 91,044,658.72 31,617,819.35 19,049,515.98 18,556,832.24 87,635,847.46

2 the part of the Fund‘s assets situated in the Czech Republic is currently accounted for in euros because all relevant contracts were concluded on an Euro basis.

52 Consolidated Statement of the Fund’s Assets