CBRE GLOBAL INVESTMENT PARTNERS CBRE GIP UK OSIRIS PROPERTY FUND Q3 2016

EXECUTIVE SUMMARY Overview CBRE GIP UK Osiris Property Fund commenced in . Some of the much-talked about fears ahead of the EU referendum have yet to materialize and October 2003. data released over the past quarter shows a UK economy that is performing well. The medium The investment objective is to out-perform the AREF/IPD term outlook, however, is far from certain. Britain’s journey to leave the European Union is UK QPFI All Balanced Property Fund Index by 0.5% p.a. likely to be arduous, meaning that volatility may return to markets and investor confidence will (before the deduction of Osiris Property Fund fees). be tested. Key Statistics . Given the adverse sentiment shift immediately post Brexit, property performance has been Total Fund Value £513.6m negatively impacted with Q3 seeing the weakest total returns since Q1 2009. Transactional Value of Holdings £502.4m activity took a major pause following the Brexit vote but there are now signs of increased Undrawn Fund Commitments £4.9m volumes. Therefore uncertainty statements adopted by the valuation industry in July and August Undrawn Client Commitments £0.0m were moderated in September, or in some instances removed all together. Cash on Account £11.2m Valuation per Unit £1,285.72 . It remains early days in terms of the potential negative repercussions stemming from Brexit. We Number of Investments 27 are therefore taking a cautious approach to investment activity and will focus on funds with - Active 19 - Wind Down 8 more defensive assets and sectors where income is the primary driver of performance. Gross Distribution Yield 3.8% . During the quarter, Curlew Student Trust drew the £10.0m commitment made in Q2 2016 and Leverage 13.6% Palmer Capital Development Fund III drew £8.8m, leaving £4.9m to be drawn. We received No of Investors 47 399,273.203 redemption proceeds from Standard Life UK Retail Park Trust of £1.3m. Additionally, capital No of Units in Issue No of Units Created (Quarter) 661.679 distributions amounting to £1.4m were received across Palmer Capital Development Fund II, No of Units Transferred (Quarter) 3,622.800 Palmer Capital Development Fund II B and Palmer Capital Development Fund III. No of Units Redeemed (Quarter) - . The portfolio produced a total return of -0.9% over the quarter, underperforming the Performance performance objective, and 4.4% over the last 12 months, outperforming the benchmark and Performance Portfolio1 Benchmark2 performance objective by 1.0% and 0.5% respectively. Longer term performance remains Objective strong, outperforming the benchmark since inception and by 0.1% and 0.7% over the last three Q3 2016 -0.9% -0.7% -0.6% and five years respectively. 1 Year 4.4% 3.4% 3.9% 3 Year (p.a.) 11.5% 11.4% 11.9% . Performance in the quarter has once again been positively impacted by the portfolio’s 5 Year (p.a.) 8.7% 8.0% 8.5% overweight exposure to the industrial sector (Airport Industrial PUT and Industrial Property 10 Year (p.a.) 2.3% 2.4% 2.9% Since Inception 6.3% 6.2% 6.7% Investment Fund) and student accommodation (UNITE UK Student Accommodation Fund). (p.a.) Meanwhile, investments in the retail warehouse sector (Henderson UK Retail Warehouse Fund 1 Returns shown are NAV to NAV gross of Osiris fee. and Standard Life UK Retail Park Trust) have been detractors to overall portfolio returns. Current quarter’s income assumed to be the same as previous; returns cannot be compounded as they are PROPERTY SECTOR EXPOSURE (BASED ON INVESTED GAV) subject to change.

Unit Shops 4.8% 2 The benchmark is a composite of the AREF/IPD UK QPFI All Property Fund Index until 30th June 2006; Shopping Centres 12.2% thereafter the AREF/IPD UK QPFI All Balanced Property Fund Index. Retail Warehouse 13.7% Note: Underlying fund data (sector exposure and Central London Offices 10.5% leverage) is based on prior quarter information.

Offices - Rest of UK 14.0% Contact Information Industrial 25.8% Dugal Hunt Portfolio Manager Other Commercial 14.3% CBRE Global Investment Partners Listed Securities 0.0% T: + 44 (0) 20 7809 9333 E: [email protected] Overseas Property 0.0% Max Johnson Cash 4.8% Director, GIP Investor Services CBRE Global Investment Partners LARGEST FIVE HOLDINGS (BASED ON INVESTED NAV) T: + 44 (0) 20 7809 9350 E: [email protected]

Schroder UK Real Estate Fund 9.9% Third Floor, One New Change, London, EC4M 9AF T: +44 (0) 20 7809 9000 F: +44 (0) 20 7809 9002 BlackRock UK Property Fund 7.3% Global Investment Partners (GIP) is a trading name of CBRE Global Investment Partners Limited Rockspring Hanover Property Unit Trust

7.0%

UBS Triton Property Unit Trust 6.6%

Airport Industrial Property Unit Trust 6.3%

Other 63.0% Li

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 1

UK MARKET COMMENTARY . FIGURE 1: CITI ECONOMIC SURPRISE INDEX FOR THE UK. ECONOMIC BACKGROUND

As the third quarter of 2016 progressed, financial markets rebounded from the lows of late June, the domestic political 150 landscape transformed and property investor confidence returned following an initial adverse reaction. Some of the much-talked 100 about fears ahead of the EU referendum have yet to materialise and 50 in many ways it is business as usual. The UK continues to do much better than expected (Figure 1). Data released over the past quarter 0 shows an economy that is performing well: employment participation is historically high, real wage growth is supporting -50 consumer spending and business confidence has returned to levels indicative of modest economic expansion in the final quarter of the -100 year. A key reason for this is the powerful stabilising effect of a Apr 13 Oct 13 Apr 14 Oct 14 Apr 15 Oct 15 Apr 16 Oct 16 depreciating currency. The medium term outlook, however, is far from certain. Britain’s journey to leave the European Union is likely Source: Thomson Reuters Datastream to be arduous, meaning that volatility may return to markets and investor confidence will be tested. The watchword is caution. FIGURE 2: TOTAL RETURN COMPONENTS, % Q/Q. PROPERTY MARKET UPDATE LATEST=SEPTEMBER '16. Given the adverse sentiment shift immediately post Brexit, property performance decelerated quite notably, though capital value 15.0 declines did not amount to what was initially feared. According to 10.0 the CBRE Monthly Index, the all property total return in Q3 2016 5.0 was -2.7%, the softest quarterly outturn since Q1 2009 (Figure 0.0 2). A closer look at monthly data shows that all of the losses -5.0 occurred in July, with August and September performance being -10.0 flat. Industrials proved to be the most defensive of the main sectors, -15.0 but still delivering a negative quarterly return of -0.4%. The ‘other’ sector was more resilient with a return of +0.5%, whilst the retail and office sectors both underperformed the broader market delivering returns of -3.3% and -4.0% respectively. Income Return Capital Value Growth Total Return OCCUPIER MARKETS Over the course of Q3, occupier markets throughout much of the Source: CBRE Monthly Index country have held up well. Supported by a lack of new supply, the vacancy rate at an all property level has subsided to a 12 year low according to the MSCI Monthly Index (Figure 3). New leases have FIGURE 3: VACANCY RATE – FLOOR SPACE, %. been signed at a pace similar to the first half of the year and very few tenants are referencing the result of the EU referendum in lease negotiations. There is, however, anecdotal evidence that we may be 15 reaching the peak of the occupational cycle. We have started to see a dampening of interest at the very prime end of the West End 10 office market and agents are talking about reducing quoting rents. Away from prime London property, tenants are comfortable taking a harder line in rental negotiations. Landlords, mindful of 5 an impending lower growth environment, are becoming more accepting of tenants’ demands. 0

CAPITAL MARKETS

Aug-03 Aug-04 Aug-05 Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 Aug-15 Aug-16 Transactional activity took a major pause for breath in Q3 (Figure Aug-02 4). Domestic institutions, led by the open-ended retail funds, were net sellers of property, overseas capital remained highly selective Source: MSCI Monthly Index and focused on large lot sizes while property companies opportunistically chipped at previously agreed prices. This took investment volumes to their lowest quarterly level since Q2 2012, FIGURE 4: OVERALL MARKET TRANSACTIONS BY SECTOR, down 33% QoQ and 43% YoY (Figure 4). The evidence emerging £BN. SOURCE: PROPERTY DATA, LATEST Q3 2016. from recent transactions illustrates that good stock with longer income in London and the South East is trading at or near pre- referendum pricing, while secondary product with any risks to 25 income is struggling to find a depth of interest. 20 SUMMARY 15 The past quarter evolved better than we had anticipated. However, our concerns about the medium term outlook have not subsided. 10 We maintain that it remains early days in terms of the potential 5 negative repercussions from Brexit for both the economy and the property market. Rules of engagement between Britain and the EU 0 have not been agreed, meaning there could be adverse changes to 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 regulation over the holding period of an asset. The Bank of England Leisure, Mixed & Other Industrial has signalled its intent to maintain an accommodative stance. This Offices Retail should continue to provide a favourable environment for real estate. 4Q Rolling Average While we are encouraged by the current state of occupier markets, a lower growth environment suggests that challenges are likely Source: Property Data afoot.

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 2

PORTFOLIO COMPOSITION . STYLE ALLOCATION (BASED ON INVESTED NAV) . The portfolio is invested/committed to 27 underlying UK property funds, providing exposure to in excess of £15bn of UK commercial property assets. 19 of these funds are 'active' whilst the remaining 8 are in various stages of wind down. The funds Core Balanced 48.1% in wind down account for 0.4% of value by NAV. . The portfolio provides predominantly core, diversified exposure to the UK commercial real estate market with 93.0% invested in Core Specialist 44.9% either core balanced or core specialist funds. The remainder is invested in value add or opportunistic funds (4.8% by invested NAV) and a cash holding of 2.2%. The portfolio is 57.8% Value Add/Opportunistic 4.8% invested in open-ended funds. . The portfolio exposure is broadly in line with our strategic house

views. It is overweight to the industrial, ‘other commercial’ Cash 2.2% (including student accommodation) and shopping centre (prime dominant schemes) sectors, while remaining underweight to high street retail and retail warehouses. The portfolio remains underweight to the office sector.

ACTIVITY FUND TYPE EXPOSURE (BASED ON INVESTED NAV) . During the quarter, the £10.0m committed to Curlew Student Trust in Q2 was fully drawn. The fund is closed end, with a 7 year life, and has a strategy to forward fund and hold good quality, direct let purpose built student accommodation in Open Ended 57.8% predominantly Russell Group towns. The fund has a target net IRR of 12% p.a. (five years) from launch. The fund has acquired 20 assets to date and has a strong pipeline of further opportunities. Our plan is to make further investment into this vehicle over the coming quarters. Closed Ended 40.0% . Following the £9.0m top up commitment in Q3, Palmer Capital Development Fund III drew £8.8m in the quarter. At quarter end, there was a further £4.9m of undrawn commitment to the fund, which we expect to be drawn by year end. Cash 2.2% . Standard Life UK Retail Park Trust settled the remainder of the

redemption request that we served in September 2014, returning £1.3m of capital to the portfolio. . Capital distributions amounting to £1.4m were received from a combination of Palmer Capital Development Fund II, Palmer Capital Development Fund II B and Palmer Capital Development Fund III. RELATIVE SECTOR ALLOCATION1 – (BASED ON INVESTED GAV) FUTURE PLANS . Whilst the past quarter evolved better than we had anticipated Unit Shops -6.4% there are still medium term concerns for the economy and UK

property markets following the outcome of the EU Referendum. Shopping Centres 7.7% Recent announcements by the UK government have also increased the chances that Britain is heading towards a ‘hard Brexit’. We consider that certain sectors are likely to be more Retail Warehouses -2.2% vulnerable under this scenario with central London offices looking particularly at risk. Central London Offices -3.4% . We have been positioning our portfolios to have a more defensive orientation meaning our client portfolios are Offices - Rest of UK -4.0% underweight central London offices while generally being overweight to industrials, which offer an attractive income return, and the ‘other’ sector (such as student accommodation, leisure Industrials 4.4% and healthcare) where returns are least correlated with the wider economic environment. We are now in the process of increasing Other Commercial 5.0% portfolio allocations to funds offering longer dated income benefiting from inflation-linked, or fixed, rental uplifts which Listed Securities 0.0% should prove to be defensive holdings. . We believe a natural progression of our recent strategy will Cash -1.1% position our client portfolios for resilience in a UK property market that will be adversely impacted by Brexit. We will, -10% -8% -6% -4% -2% 0% 2% 4% 6% 8% 10% however, continue to monitor investments, including on the secondary market, as periods of uncertainty can often lead to mispricing opportunities. . Overall, despite some short term challenges, we believe the Osiris portfolio is well positioned for the long term and provides 1 Relative Sector Allocation is calculated based on the GAV sector weightings of diversified exposure to good quality real estate across the UK. the Osiris Property Fund compared to the sector weightings of the AREF/IPD UK QPFI All Balanced Property Fund Index.

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 3

PERFORMANCE . PORTFOLIO PERFORMANCE . The portfolio produced a total return of -0.9% over the quarter, underperforming the performance objective, and 4.4% over the 14.0% last 12 months, outperforming both the benchmark and 11.9% 11.5% performance objective by 1.0% and 0.5% respectively. 12.0%

. Over the longer term, the Osiris portfolio has maintained strong 10.0% relative performance against the benchmark, outperforming 8.0% over the last three and five years by 0.1% and 0.7% per annum 6.7% respectively. 6.3% 6.0% . UNITE UK Student Accommodation Fund was a strong positive 4.4% 3.9% contributor to performance with a return of 2.5% over the 4.0% quarter and 12.7% over the last 12 months. Over the quarter, performance was predominantly driven by the portfolio’s strong 2.0% income return. In September, USAF acquired Gosford Gate in Coventry and Greetham Street in Portsmouth from Unite Plc for 0.0% -0.6% -0.9% £88.4 million. The fund continues to demonstrate a strong -2.0% letting performance with 97% of bed spaces let for the 2016/2017 academic year. -4.0% Quarter Performance Year Performance 3 Years Performance Since Performance . Palmer Capital Income Unit Trust returned 2.0% over the quarter Objective Objective (p.a.) Objective Inception Objective and 11.1% over the last 12 months. The strong return was (p.a.) primarily driven by a further increase in the valuation of the Performance Objective Income Capital Total Return fund’s largest asset at Finsgate, London. In addition, the sale of residential flats at Abingdon and Bicester continue to progress well with sales completing 11% ahead of valuation. The manager is continuing to focus on new investment opportunities TOP FIVE CONTRIBUTORS AND DETRACTORS TO 1 offering secure and sustainable income streams with a longer PERFORMANCE – QUARTER

than average income duration. UNITE UK Student Accommodation Fund 0.1% . Industrial Property Investment Fund (“IPIF”) was a positive Palmer Capital Income Unit Trust 0.1% contributor to performance returning 0.7% and 9.2% over the quarter and past 12 months respectively. Over the quarter the Industrial Property Investment Fund 0.0%

fund’s property assets remained broadly unchanged. IPIF Schroder UK Real Estate Fund 0.0% completed over £9m of added value transactions and enjoyed one of its strongest letting quarters, letting £2.3m of space 13% Hermes Property Unit Trust 0.0% above ERV. Furthermore, the fund completed multi-let developments at Rochester and Mitcham and is in advanced Rockspring Hanover Property Unit Trust -0.1% leasing discussions on a number of these units. At quarter end the portfolio consisted of 208 assets valued at £1,699m. Palmer Capital Development Fund III -0.1%

. Schroder UK Real Estate Fund returned 0.3% over the quarter West End of London Property Unit Trust -0.2% and 6.7% over the past 12 months. The quarterly return was Standard Life UK Retail Park Trust -0.2% driven by income which offset capital value falls that followed the negative sentiment in the property market post the EU Henderson UK Retail Warehouse Fund -0.3% referendum. Since the referendum, however, the fund has -0.4% -0.3% -0.2% -0.1% 0.0% 0.1% 0.2% exchanged and agreed lettings and lease extensions that will, in total, add £8.8m to the fund's annual rent roll. This includes a major new letting to HMRC for the entire 180,000 sq ft office building under construction at One Ruskin Square, Croydon. TOP FIVE CONTRIBUTORS AND DETRACTORS TO 1 . Standard Life UK Retail Park Trust was a detractor to PERFORMANCE – 1 YEAR

performance with a return of -5.6%% over the quarter and -5.9% UNITE UK Student Accommodation Fund 0.8% over the last 12 months. The like for like valuation of the portfolio decreased by 6.5% over the last three months. This Schroder UK Real Estate Fund 0.7%

decline was attributable to valuation falls in the retail warehouse Palmer Capital Income Unit Trust 0.7% sector post Brexit, with a particular lack of investor demand for large retail park assets. In August 2016, the manager sold Industrial Property Investment Fund 0.5% Greyhound Retail Park, Chester and used the sale proceeds to Palmer Capital Development Fund II 0.4% meet the trust’s outstanding redemption requests on 12 September. Given market uncertainties the manager also applied a market value adjustment of -4.0% to the August GCLOD UK Feeder Fund 0.0%

valuation to ensure the redemption price was fair to both Palmer Capital Development Fund III -0.1% continuing and exiting investors. This adjustment was removed in September. Henderson UK Retail Warehouse Fund -0.2% . Henderson UK Retail Warehouse Fund returned -7.4% over the Standard Life UK Retail Park Trust -0.2%

quarter and -5.0% over the year. Over the quarter, the fund’s Henderson UK Shopping Centre Fund -0.7% NAV fell by 8.5%, which was partially offset by its income return. The performance of the underlying assets in the portfolio was -1.0% -0.5% 0.0% 0.5% 1.0% mixed. The manager completed a number of successful asset management initiatives and secured new lettings at Romford, Ashford and Swansea. However valuation declines were seen at 1 Calculated as a weighted contribution to the portfolio return over the stated properties with vacancies, shorter income profiles and period development land. . The distribution yield has increased to 3.8%, below the market average yield of 4.0%; we plan to further increase this through further investments in higher income yielding investments.

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 4

PORTFOLIO HOLDINGS AS AT Q3 2016

PERFORMANCE3 NAV % of Undrawn Holding (£m) Portfolio1 (£m) Leverage2 Quarterly 1 Year Comment Specialist, core, closed-end fund investing in the industrial sector. The fund Airport Industrial Property Unit Trust 32.255 6.3% - 22.3% 0.1% 5.1% concentrates on prime industrial estates and warehouses with a focus in the Heathrow area, but also provides some exposure to other major UK airports. Specialist, core, closed-end UK regional office fund that invests in good quality office Ardstone UK Regional Office Fund 28.156 5.5% - 29.4% -0.7% 5.6% assets in major city business districts.

Balanced, core, open-end UK fund. Predominantly good quality assets with above BlackRock UK Property Fund 37.391 7.3% - 3.3% -0.5%, 2.8% average exposure to the 'other' sector. The fund went into administration during Q4 2012 and subsequently disposed of all CBRE Retail Property Fund Britannica Unit - 0.0% - 0.0% 0.0% 0.0% its property assets. No further capital receipts are expected as the fund structure is Trust dissolved. Balanced, core, open-end UK fund. Good quality portfolio with above average CBRE UK Property Fund (Guernsey) 24.696 4.8% - 0.0% -1.1% 4.4% income distribution. Specialist, value add, closed-end UK student accommodation fund. The fund's Curlew Student Trust 9.879 1.9% - 13.7% 0.0%3 0.0%3 strategy is to forward fund and hold good quality, direct let purpose built student accommodation in predominantly Russell Group towns. Specialist, opportunistic, closed-end central London office development fund. The GCLOD Guernsey Feeder Trust 0.000 0.0% - 0.0% 0.0% -29.6% fund sold its last asset and distributed the majority of proceeds during Q3 2014. Final monies are expected once the fund structure has been dissolved. Specialist, opportunistic, closed-end central London office development fund. The GCLOD UK Feeder Trust 0.085 0.0% - 0.0% 0.0% -32.5% fund sold its last asset and distributed the majority of proceeds during Q3 2014. Final monies are expected once the fund structure has been dissolved. Specialist, core, closed-end fund investing in UK retail warehouses. The portfolio is Henderson UK Retail Warehouse Fund 17.689 3.4% - 38.0% -7.4% -5.0% primarily invested in good quality out-of-town open A1 fashion parks. Specialist, core, closed-end fund largely invested in prime dominant shopping centres Henderson UK Shopping Centre Fund 26.063 5.1% - 16.7% -1.4% -12.9% such as Bullring, Birmingham and Whitefriars, Canterbury. The fund has extensive plans to redevelop St. James, Edinburgh. Balanced, core, open-end UK fund which has a stable management team and a Hermes Property Unit Trust 26.555 5.2% - 0.0% 0.2% 7.1% strong track record. Specialist, core, closed-end fund investing in the industrial sector. The fund is focused Industrial Property Investment Fund 31.077 6.1% - 25.4% 0.7% 9.2% on good quality multi-let industrial estates throughout the UK with a bias towards London and the South East. Specialist, core, closed-end fund invested in two prime shopping centres - Bluewater Lend Lease Retail Partnership 27.649 5.4% - 1.3% -1.4% 3.3% in Kent and Touchwood in Solihull.

Diversified, opportunistic, closed-end development fund. The fund has sold all assets Palmer Capital Development Fund I 0.009 0.0% - 0.0% 0.0% -5.4% and is in the process of winding down the structure.

Diversified, opportunistic, closed-end development fund. The fund has sold all assets Palmer Capital Development Fund II 0.044 0.0% - 0.0% 0.0% NM5 and is in the process of winding down the structure.

Diversified, opportunistic, closed-end development fund. The fund has sold all assets Palmer Capital Development Fund II (B Units) 2.036 0.4% - 26.7% 0.0% 6.9% and is in the process of winding down the structure.

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 5

PORTFOLIO HOLDINGS AS AT Q3 2016 (CONTINUED)

PERFORMANCE 3 NAV % of Undrawn Holding (£m) Portfolio 1 (£m) Leverage 2 Quarterly 1 Year Comment Diversified, opportunistic, closed-end development fund. The fund strategy is to Palmer Capital Development Fund III 12.764 2.5% 4.857 33.1% -4.0% -5.9%3 purchase undermanaged assets at attractive pricing, reposition for sale and to achieve planning gains. Diversified, core, closed-end UK fund with a portfolio of small sized assets with Palmer Capital Income Unit Trust 31.189 6.1% - 0.0% 2.0% 11.1% longer than average lease lengths. These assets are in secondary locations albeit generally with a low-risk tenancy profile. Balanced, core, open-end UK fund with secondary quality assets distributing an Rockspring Hanover Property Unit Trust 35.937 7.0% - 2.8% -1.4% 4.4% above-average income.

Balanced, core, open-end UK fund with a better than average quality of stock in Schroder UK Real Estate Fund 50.782 9.9% - 1.5% 0.3% 6.7% the portfolio.

Specialist, core, closed-end retail warehouse fund predominantly invested in out- Standard Life UK Retail Park Trust 17.875 3.5% - 0.0% -5.6% -5.9% of-town open A1 fashion parks, with a bias towards the South East. Specialist, value add, closed-end fund investing in the industrial sector. The The Industrial Trust 0.009 0.0% - 0.0% -0.0% -2.4% fund has sold all its assets and returned the majority of proceeds to investors. A final settlement and termination of the fund is expected by the end of 2016. Diversified, value add, closed-end fund targeting a high distribution yield. The Threadneedle Strategic Property Fund IV 0.051 0.0% - 47.6% 2.9% NM5 fund sold its last asset and the fund structure is being dissolved.

Balanced, core, open-end UK fund. Good quality portfolio with above average UBS Life Triton Property Fund 6.878 1.3% - 8.5% -1.4% 3.8% income distribution.

Balanced, core, open-end UK fund. Good quality portfolio with above average UBS Triton Property Unit Trust 33.670 6.6% - 8.5% -1.3% 3.8% income distribution. Specialist, core, semi open-end UK student accommodation fund. The fund has UNITE UK Student Accommodation Fund 28.472 5.5% - 30.8% 2.5% 12.7% a well-diversified portfolio with a focus towards Russell Group universities and is managed by a market leading management team. Specialist, semi open-end fund investing in central London offices, with a bias West End of London Property Unit Trust 21.188 4.1% - 18.3% -4.2% 3.1%3 towards the West End and Mid-Town. The fund adds value through refurbishment of assets.

Total Value of Holdings 502.401 97.8% 4.857

Cash at bank 11.188 2.2% Debtors/Creditors4 -0.018 -0.0%

Portfolio Total 513.571 100.0% 4.857 13.6%

1 Calculated as Fund NAV / Portfolio NAV 2 Debt/GAV, in line with the leverage formula of IPD and INREV 3 Where an asset has been held for less than a quarter (or a year, as applicable), performance since inception has been used 4 Debtors / Creditors include income and expenses as well as pending trades, but does not take account of any client capital funding requested in the quarter but due in the subsequent period 5 NM = Not Meaningful

CBRE GIP UK OSIRIS PROPERTY FUND | Q3 2016 | 6

SUMMARY OF ACTIVITY

Currency Amount (‘m) Amount (‘m) Holding Transaction Type (Local) (Local) (Base) Curlew Student Trust Drawdown GBP 10.000 10.000 Palmer Capital Development Fund II Return of Capital GBP 0.071 0.071 Palmer Capital Development Fund II B Return of Capital GBP 0.480 0.480 Palmer Capital Development Fund III Drawdown GBP 8.830 8.830 Palmer Capital Development Fund III Return of Capital GBP 0.844 0.844 Standard Life UK Retail Park Trust Redemption GBP 1.300 1.300

FEES PAYABLE TO CBRE GROUP, INC

. During the quarter, no fees were payable to CBRE Group, Inc. for secondary market brokerage on behalf of Osiris.

COMPLIANCE WITH INVESTMENT RESTRICTIONS

The portfolio is fully compliant with all investment restrictions.

Restriction Limit Actual Maximum invested in a single fund 20.0% (NAV) 9.9% Maximum invested in in-house funds 15.0% (NAV) 4.8% Maximum invested in Limited Partnerships 25.0% (NAV) - Investment in a vehicle that has more than 15% outside the UK 0.0% (NAV) - All investments must be permitted by a Pension Fund Pooling Scheme 100.0% (NAV) 100.0% Maximum borrowing (at CBRE GIP UK Osiris Property Fund level) 15.0% (NAV) - Maximum to be held in cash, bonds or gilt funds 1 15.0% (NAV) 2.2% Maximum invested in property derivatives 15.0% (NAV) - 1 Only permitted to hold more than 15% on a temporary basis

ESG

. The annual results of the GRESB survey can be found on pages 8 and 9 of this report.

CORPORATE ACTIONS

During the quarter, GIP voted on the following corporate actions: . CBRE UK Property Fund: During the quarter, GIP voted in favour of a merger of CBRE UK Property Fund (CBRE UKPF) with the Electricity Supply Pensions Scheme (ESPS) portfolio. The merger involves the conversion of the existing fund structure into a Property Authorised Investment Fund (PAIF) with investors serving redemptions from the various existing CBRE UKPF share classes in exchange for units in the PAIF. The vote was passed. . Hermes Property Unit Trust: During the quarter, GIP voted in favour of three resolutions: to adopt the Report of Accounts for the year ending 25 March 2016; to re-elect Simon Melliss and David Nicol to the Appointments Committee; and to re-appoint PricewaterhouseCoopers as auditor. The vote was passed. . Threadneedle Strategic Property Fund IV: During the quarter, GIP voted to receive the Manager's Report, the Auditor's report and the Accounts for 2015; to reappoint PricewaterhouseCoopers as the Auditors; and to authorise the Manager to fix their remuneration. The vote was passed. . West End of London Property Unit Trust: During the quarter, GIP voted in favour of four resolutions: (i) cap the ownership of units by a holder together with its associates to 49.9% of the total units in issue (with a Fund Manager and Property Manager cap of 24.9%); (ii) cap the voting rights of a holder together with its associates to 24.9% of votes cast; (iii) extend the tenure of an Elected Member of the Holder Advisory Committee from 12 months to 24 months; and (iv) amend and restate the Property Adviser’s Agreement. The resolutions were approved.

GLOSSARY

Term Description Value of holdings Sum of the Net Asset Value (NAV) of the underlying holdings, excluding cash, hedging and debtors / creditors Undrawn fund commitments Commitments made to underlying funds but which have not yet been drawn Cash on account Cash including debtors / creditors Undrawn client commitments Capital committed by the client but yet to be drawn Available to commit Represents undrawn client commitments plus cash on account minus undrawn fund commitments Leverage Debt / GAV, in line with the leverage formula of IPD and INREV

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GRESB 2016 SURVEY RESULTS . GIP uses the independent GRESB Survey as the key ESG measurement tool for all client portfolios. The GRESB Survey measures both a manager’s approach to ESG management and policy, and the implementation and measurement of the ESG policy and parameters. . The Osiris portfolio has 27 underlying funds and 17 of these participated in the GRESB Survey this year, which reflects 90.8% of the portfolio NAV as at Q3 2016 (excl. cash). Based on a weighted average of the results for the 17 funds, the portfolio overall score was 70 for a portfolio with equivalent geographic and sector exposure. . The highest scores achieved across the portfolio were the Henderson UK Retail Warehouse Fund, Henderson UK Shopping Centre Fund and Lend Lease Retail Partnership. 15 of the 17 participating funds were awarded Green Stars which is recognition for being an industry leader. . The overall score increased by 6 points compared to the previous year’s score of 64. This result was mainly attributable to the following: − Henderson UK Retail Warehouse Fund improved their performance on Environment and Social and achieved a green star rating. The fund ranks number 1 in UK non-listed funds in the retail sector. Most notable improvements are in the aspects of risks and opportunities, performance indicators and building certifications. The fund has improved on implementation of governance policies and risk assessments. It has also reported a reduction in water use and GHG emissions and a higher number of green building certificates and EPC rated assets. − BlackRock UK Property Fund improved their performance on Environment and Governance and achieved a green star rating. This was achieved through notable improvements in Building Certifications and Stakeholder Engagement. The fund has reported a higher percentage of green building certificates and an increase in the proportion of the portfolio rated by UK EPCs. It has also improved on employee engagement, inclusion of sustainability lease clauses and sustainability specific requirements in procurement. . The aggregate annual portfolio footprint is detailed as follows: − Energy consumption (MWH): 488,124 (45% portfolio coverage)

− GHG Emissions (tonnes CO2): 109,584 (75% portfolio coverage) − Water Use (m3): 1,878,553 (81% portfolio coverage) − Waste management (tonnes): 15,072 (76% portfolio coverage) . The poorer performing investments included Ardstone UK Regional Office Fund. Ardstone UK Regional Office Fund improved their performance on Social and Governance aspects with significant improvement in Monitoring & EMS and Stakeholder Engagement. The fund is now undertaking independent reviews of its energy and data management systems, is involved in a tenant engagement program/satisfaction survey and have incorporated sustainability in the supply chain i.e. leasing and procurement. There is scope for improvement in data collection and reporting on performance indicators. . As noted in the chart on the next page, the portfolio exceeded the benchmark for Management, Risks & Opportunities, Monitoring & EMS, Performance Indicators, Building Certifications and Stakeholder Engagement and underperformed the benchmark for Policy and Disclosure.

GRESB SCORE

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PORTFOLIO SUMMARY

Source: GRESB Survey 2016

DEFINITIONS . Survey: The GRESB Survey is structured around eight unique sustainability aspects. The data provided in the GRESB Survey is scored, based on the Survey questions materiality. The eight aspects score sum generates the overall GRESB score, which is expressed as a percentage maximum. The total GRESB score is further divided into two dimensions: Management & Policy (MP) and Implementation & Measurement (MP). . Overall Score: The GRESB scoring is based on an automated mathematical model. The scoring is completed instantaneously without manual intervention after data verification has been finalised. The score sum for each questions add to a maximum of 137 points, and the overall GRESB score is expressed as a percentage being the maximum of 100%. The maximum aspect score is a weighted element of the GRESB score. . ESG: In 2015, GRESB introduced a breakdown of the GRESB score into separate scores for Environmental, Social and Governance (ESG). These scores are calculated based on the allocation of individual questions to E, S, or G. . Historical Trend: This chart illustrates changes in score of constituent funds over the past three years.

DIMENSIONS . Management & Policy: The means by which a company or a fund deals with or controls its portfolio and its stakeholders and/or a course or principle of action adopted by the company or fund. The maximum score for MP is 38.5 points which is 28% of the overall GRESB score. . Implementation & Measurement: The process of executing a decision or plan or putting a decision or plan into effect and/or the action of measuring something related to the portfolio. The maximum score for IM is 98.5 points which is 72% of the overall GRESB score.

SUSTAINABILITY ASPECTS . Management: The purpose of this section is: (1) to identify who is responsible for managing sustainability issues and who has the authority of decision making on sustainability matters; (2) sustainability management issues, and (3) how sustainability is embedded in the organisation. . Policy & Disclosure: This section investigates how sustainability policies are developed and embedded in the organisation. Moreover, the section analyses the disclosure process of sustainability related issues to main stakeholders of the company/fund, communication of key achievements and to identify the reporting framework of the company/fund. . Risks & Opportunities: This section analyses the steps being taken by the organisation to stay abreast of sustainability risks related to bribery & corruption, climate change, legislation, market risks, and other material risks. . Monitoring & EMS: The purpose of this section is to investigate the steps taken by the organisation to monitor compliance with their sustainability policy goals. It assesses the environmental management system that facilitates monitoring of sustainability data, review systems and policies to more accurately manage sustainability. . Performance Indicators: The purpose of this section is to identify to the extent to which organisations/funds measure and optimise the performance of their standing investments. Absolute measure for the portfolio as it stood in the reporting period. . Building Certifications & Benchmarking: The purpose of this section is to establish the organisation commitment and performance in obtaining and maintaining building certifications. . Stakeholder Engagement: The purpose of this section is to identify the steps taken to engage with the fund’s stakeholders and the nature of the engagement. Stakeholders include tenants, suppliers, workforce and local community. . New Construction and Major renovation: Identifies the portfolio’s structure for newCBRE construction GIP UK OSIRIS projects. PROPERTY The portfolioFUND | Q3 receives 2016 | an 9 additional survey a score for ongoing New Construction & Major Renovation.

IMPORTANT NOTICE

. This publication is not for distribution in any territory or jurisdiction where such distribution would be illegal. . CBRE Global Investment Partners (GIP) is a trading name of CBRE Global Investment Partners Limited which is authorised and regulated in the United Kingdom by the Financial Conduct Authority (FCA). . The information contained herein must be treated in a confidential manner and may not be reproduced, used or disclosed, in whole or in part, without the prior written consent of CBRE Global Investment Partners Limited. . This document is issued and approved by CBRE Global Investment Partners Limited, in accordance with the restrictions on the promotion of non- mainstream pooled investments, the communication of this document in the United Kingdom is only made to persons defined as professional client or eligible counterparties, as permitted by COBS 4.12.5R (Exemption 7) and the Collective Investment Scheme (Exemptions) Order 2001. . Where funds are invested in property, investors may not be able to realise their investment when they want. Whilst property valuation is conducted by an independent expert, any such opinion is a matter of the valuer’s opinion. Property is a specialist sector which may be less liquid and produce more volatile performance than an investment in broader investment sectors. . Past or projected performance is not necessarily indicative of future results. Forecasts of future performance are not a reliable indicator of future performance. . Targeted and forecasted returns are derived from analysis based upon both quantitative and qualitative factors, including market experience and historical and expected averages related to the risk/return profile for yet-to-be liquidated current investments of the prior Accounts/Funds and programs’. The targeted and forecasted returns are based on a weighted blend of the prior Accounts/Funds’ and programs’ returns to date and the expected cumulative internal rates of return generated by the expected liquidation of investments across the remaining terms of the prior Accounts/Funds’ and programs’. These forecasts and projections are hypothetical in nature, do not reflect actual investment results and should not be construed as providing any assurance as to the results that will actually be realized by the prior Accounts/Funds’ and programs or that may be realized by any future Account/Fund or program in the future. . All target or projected “gross” internal rates of return (“IRRs”) do not reflect any management fees, incentive distributions, taxes, transaction costs and other expenses to be borne by certain and/or all investors, which will reduce returns. “Gross IRR” or “Gross Return” shall mean an aggregate, compound, annual, gross internal rate of return on investments. “Net IRR” or “Net Returns” are shown after deducting fees, expenses and incentive distributions. There can be no assurance that the mandate will achieve comparable results, that targeted returns, diversification or asset allocations will be met or that the investment strategy and investment approach will be able to be implemented or that the mandate will achieve its investment objective. Actual returns on unrealized investments will depend on, among other factors, future operating results, the value of the underlying assets and market conditions at the time of disposition, foreign exchange gains or losses which may have a separate and uncorrelated effect, legal and contractual restrictions on transfer that may limit liquidity, any related transaction costs and the timing and manner of sale, all of which may differ from the assumptions and circumstances on which the valuations used in the prior performance data contained herein are based. Accordingly, actual returns may differ materially from the returns indicated herein. If an Account/Fund investing in emerging markets is affected by currency exchange rates, the investment could either increase or decrease. These Accounts/Funds therefore carry more risk. . The value of any tax benefits described herein depends on your individual circumstances. Tax rules may change in the future. . Statements contained in this Presentation that are not historical facts are based on current expectations, estimates, projections, opinions and beliefs of GIP. Such statements involve known and unknown risks, uncertainties and other factors, and undue reliance should not be placed thereon. Actual events or results or the actual performance of the mandate may differ materially from those reflected or contemplated in such forward-looking statements. . Certain economic and market information contained herein has been obtained from published sources prepared by third parties and in certain cases has not been updated. Neither GIP nor any CBRE Group Inc company its respective affiliates nor any of their respective employees or agents (collectively, “CBRE”) assume any responsibility for the accuracy or completeness of such information. . Whilst GIP believes that the information contained herein is accurate at the date hereof (or at the date shown in the document), neither GIP nor CBRE makes any representation or warranty, express or implied, with respect to the fairness, correctness, accuracy, reasonableness or completeness of any of the information contained herein (including but not limited to information obtained from third parties), and they expressly disclaim any responsibility or liability therefore.

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