Finsbury Circus, London, United Kingdom September 2008 EUROPEAN LEADERS PRESENTATION Agenda 1. European Banking Relationships : Peter Hurley 2. Valad European Platform : Martyn McCarthy 3. Region Overview - UK : Didier Tandy 4. Region Overview - France : Gilles Vaissié 5. Region Overview - Germany : Klaus Kortebein 6. Region Overview - Nordics : Michael Bruhn 7. Open and Upcoming Offers : Paul Oliver/Nicki Garrett 8. Questions 9. Appendices 2 Peter Hurley The Senate, Devon, United Kingdom EUROPEAN BANKING RELATIONSHIPS : European Banking Relationships Loans from HBOS represent approximately 50% of balance sheet debt (total debt drawn as at 30 June 08 was A$1.3bn) Approximately 50% of debt in funds are loans from HBOS ­ No cross guarantees ­ No cross collateralisations ­ No cross indemnities between Valad and its managed funds or joint ventures Debt obligations are contractual; no HBOS change of control issues Valad views the proposed transaction between Lloyds and HBOS positively ­ Conservative balance sheet ­ Substantial capacity ­ Broadens quality client base Valad would be considered a good corporate customer because: ­ Only 33% on balance sheet gearing and 39% gearing on a look through basis – below peer average ­ No near term debt refinancing risk (only $45m of debt expiring in FY09 with $30m of that already rolled to FY10) ­ A$120m cash on balance sheet at 30 June 08 - balance now >A$200m following receipt of proceeds from asset sales ­ Strong interest cover (debt serviceability a key focus for banks - Valad covers interest cost nearly 3 times over) 4 5-11 Theobolds Rd, London, United Kingdom Martyn McCarthy VALAD EUROPEAN PLATFORM: European Offices – London – Leeds – Birmingham – Edinburgh – Paris – Amsterdam – Stockholm – Gothenburg – Linkoping – Malmo – Copenhagen – Oslo – Prague – Helsinki – Warsaw – Budapest – Berlin – Hamburg – Munich – Frankfurt – Bucharest – Luxembourg 6 Valad Office Valad Management Structure - Europe EUROPE Martyn McCarthy: Chief Executive Officer ESTABLISHEDFUND MANAGEMENT FUNDS VALAD EQUITY PARTNERS PROPERTY VALAD CAPITAL SERVICES David Kirkby Paul Oliver Didier Tandy Stephen McBride Head of Funds Management Head of Valad Equity Partners Head of Property Head of Valad Capital Services Mainland Europe & UK funds Fund launch Development Preferred loans (JVs) Investor relations Investment Equity raising Asset management Development management REGIONAL OFFICE HEADS UNITED KINGDOM FRANCE GERMANY NORDIC BENELUX CENTRAL & EASTERN Didier Tandy Gilles Vaissié Klaus Kortebein Michael Bruhn Mark McLaughlin EUROPE Head of Property Head of France Head of Germany Head of Nordics Head of Benelux Matthew Bann Rob Howe Head of Central and Head of Asset Eastern Europe Management Acquisitions and disposals Asset and property management 7 European Leaders Didier Tandy – Head of Property, Europe As Head of Property, Didier is responsible for the management of Valad’s European property portfolio and oversees acquisitions for Valad in Europe. With over 25 years' real estate experience, Didier has in the last 5 years successfully bought and sold £2.5bn of real estate transactions generating trading profits in excess of £200m. At that time Didier was Managing Director of the Scarborough Group of companies which was acquired by Valad in June 2007. Prior to joining Scarborough in 2000, Didier was a Director at Hemingway Properties PLC. Didier holds a degree in Mathematics and Statistics from London University. Gilles Vaissié – Head of Property, France Gilles is the Head of Property of Valad’s French operations. Gilles is a specialist in the light industrial sector with extensive expertise in acquisitions and asset management, Gilles founded GViO in 1999. Prior to establishing GViO, Gilles was General Manager and on the Board of Auguste Thouard (now Atis Real). With 30 years’ experience in the French commercial markets, Gilles has an established reputation in the French investment market. Gilles is a Graduate of Institut d’Etudes Politiques in Paris and has a Masters degree in Economics (Paris), and MRICS. Klaus Kortebein – Head of Property, Germany Klaus is the Head of Property of Valad’s German operations and has overall responsibility for the management and acquisition strategy of the Group’s German offices. Klaus has over 10 years’ senior fund and asset management experience at leading German institutions, MEAG and DEKA. Prior to joining Valad, Klaus was the Chief Investment Officer at Morgan Stanley Real Estate GmbH based in Frankfurt. Michael Bruhn – Head of Property, Nordic Michael is the Head of Property of Valad’s Nordic operations. Michael is based in Copenhagen and is responsible for managing and growing the Group’s business in the Nordic Region. Michael has more than 20 years’ experience in the Nordic property markets as a developer, agent, special projects adviser and asset manager. Prior to this role, Michael was a Senior Partner at DTZ after merging his previous company with the agency business. Michael is a Chartered Accountant and Chartered Surveyor and holds an MSc in Economics. 8 European Leaders Mark McLaughlin – Head of Property, Benelux Mark is responsible for managing and growing the Group’s asset management and development business in the Benelux Region, headquartered in Amsterdam, which includes Belgium, Netherlands and Luxembourg. He joined the Group in 2001, bringing his extensive experience in property and construction gained through roles across Europe, Singapore and his native Republic of Ireland. Mark has an Honours Degree in Civil Engineering from the University of Dundee and has been a member of RICS since 2007. Matthew Bann – Head of Property, Central & Eastern Europe Matthew joined the Group in August 2006 and is responsible for managing and growing the Group’s Central and Eastern European business, currently covering Czech Republic, Hungary, Romania, Poland and surrounding territories. Matthew has 18 years of property experience including Aerium Ltd where he was the Director of Asset Management for a Pan European Portfolio worth in excess of €2billion. Matthew has a Master’s Degree in Real Estate Investment from Cass Business School at City University London. 9 European Overview – Key Metrics AUM by Geography AUM by Business Segment Valad European Data AUM (A$’m) 11,483 Number of Valad Offices 22 UK Crownstone Valad on the ground people 308 33% 10% Number of Funds 12 Development Number of Properties incl. on balance sheet 803 7% Number of Tenants 9,262 Property Ownership Total Property Floor Area* (sqm) 6,702,052 6% Space leased H1 2008 (sqm) 612,626 VCS *excl. UCT 2% Funds Management Mainland Europe 75% 67% AUM at 26 August 2008 for each Business Segment is defined as follows: • Property Ownership: Long term investment assets and trading assets held on balance sheet and in joint ventures • Development: the Group’s share of the estimated value on completion for projects sufficiently advanced to enable reliable estimation, otherwise, the current valuation is adopted. Excludes Trading assets which are included in property ownership • Valad Capital Services Estimated value on completion • Funds Management: The AUM of Group managed funds 10 European Overview – FY08 Achievements Valad’s track record of performance and local active management expertise has enabled a number of new funds to be launched across Europe in FY08 ­ Raised A$996.6m equity and A$1,438.4m debt within Valad’s European funds ­ In addition, Valad has refinanced/raised new debt for its existing funds including a new €225m facility for CEIF and £30m for UCT to assist in the acquisition of Therese House ­ Osprey was successfully rolled over for another 10 years in September 2007 Date Launched/ Capital Raised Equity Debt Fund Comment Closed A$m A$m A$m 4 Dec 07 1312.3 465.3 847.0 German focused Aktiv fund with target IRR of 11%+ well positioned to take German Aktiv advantage of resurgent German economy 7 Jan 08 489.1 177.3 311.8 Second fund in the Nordic region capitalising on the continued outperformance of Nordic Aktiv II the economy, target IRR of 12%+ VOF UK I 29 Jan 08 311.2 196.1 115.1 Targeted towards counter-cyclical property opportunities in the UK market 14 Jul 08 322.4 157.9 164.5 Investing in multi-occupied industrial parks in France – target IRR of 11.5%+. Parc d’Activités Capitalises on proven track record of French team Total 2,435.0 996.6 1,438.4 Note: Conversion rates at time of raising 11 European Overview Investment Property Market – Size/ Investment Universe EUR (Bn) 450 400 350 300 250 200 150 100 50 0 UK Italy Spain France Nordics Europe Benelux Eastern Australia Central + Central Germany Source: IPD Valad Europe Regions Valad Asia Pacific Region Non Valad Regions 12 European Overview JLL RE Transparency Score/ 2008 Transparency Index 3.0 Opaque 2.8 2.6 2.4 2.2 2.0 1.8 1.6 1.4 1.2 Transparent 1.0 UK Italy Spain France Nordics Europe Benelux Eastern Australia Germany Central + Central Source: Jones Lang LaSalle Valad Europe Regions Valad Asia Pacific Region Non Valad Regions 13 European Overview Base Rates/ Change in Base Rate 8 7 6 5 Australia 4 3 2 UK 1 US 14 0 Jan-02 Euro Source: DatastreamApr-02 Jul-02 Oct-02 Sweden Jan-03 Apr-03 Jul-03 Oct-03 Jan-04 Apr-04 Jul-04 Oct-04 Jan-05 Apr-05 Jul-05 AUS Oct-05 Jan-06 Apr-06 Rate cut Jul-06 UK Oct-06 SWEDEN Jan-07 EURO Apr-07 Jul-07 Oct-07 US Jan-08 Apr-08 Jul-08 European Overview Micro, Small & Medium Sized Enterprises per Capita (1,000) 100 80 60 40 20 0 UK Italy Spain France Nordics Europe Benelux Eastern Australia Central + Central Source: World Bank Germany Valad Europe Regions Valad Asia Pacific Region Non Valad Regions 15 City Point – Kind St, Leeds, United Kingdom REGION OVERVIEW: UNITED KINGDOM Presented by Didier Tandy, Head of Property - Europe UK Valad Office Market Data Population1 60,943,9122 GDP Growth 1.6%3 Unemployment 5.2%3 3 3 Edinburgh Inflation (CPI) 3.8% Currency (AUD/GBP)4 0.4817 Leeds Base Interest Rate5 90 day LIBOR = 5.80% (proxy for variable rate) (excl margins) Average Yield for Office6 Prime 5.00– 6.00% B-Grade 7.75% Average Yield for Industrial6 Prime 6.00– 6.50% Birmingham B-Grade 8.00% Valad Data Local Presence London AUM (A$m) 3,826 Valad Offices: 4 Number of Funds 6 Valad Team: 137 (incl.