INVESTING IN HIGH INCOME REAL ESTATE IN CENTRAL EUROPE.

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1 INVESTING IN HIGH INCOME REAL ESTATE IN CENTRAL EUROPE

Targeted assets in gross value of 200 million.

Tangible investments available to deploy capital.

Interim distributions to investors on quar

is amounting up to 6% p.a. Czech TOP 100 AWARD Special Prize for Innovations and Transparency on Czech

07/2014 Arete Invest SICAV established 02/2016 Arete Invest Sub-fund CEE II created 04/2016 initial

2 Targeted assets in gross value of 200 million. Local expertise sourcing off-market deals; supported by top tier local partners. Tangible investments available to deploy capital. Estimated annualized returns of 11%; further capital appreciation potential in place. Interim distributions to investors on quarterly basis amounting up to 6% p.a. Czech TOP 100 AWARD Special Prize for Innovations and Transparency on Czech Investment market Sub-fund s lifecycle set to 5 7 years (planned exit in ). 07/2014 Arete Invest SICAV established 02/2016 Arete Invest Sub-fund CEE II created 04/2016 initial three acquisitions 07/2016 additional two properties in Písek acquired 03/2017 acquisition of an industrial facility initiated Exit trough divestment of the portfolio 01/2015 Arete Invest Sub-fund CEE established 01/2015 our residential portfolio acquired 10/2016 divestment of our residential portfolio 01/2017 first Slovak acquisition 02/2017 two more acquisitions in Slovakia signed 08/2017 Arete Invest Sub-fund CEE closed 1

Robert Ides Founder, Member of Administrative Board Robert has management consulting background and he

He drove numerous value enhancing initiatives over the last 10 years.

real estate and corporate acquisitions in the Czech financial and regulatory environment.

Sushil Manmohan Shergill Member of Administrative Board Member of Investment Committee Sam has 20 years of

of experience in management of various funds focused on real estate and other alternative investments at the

3 Robert Ides Founder, Member of Administrative Board Robert has management consulting background and he focused on complex M&A and strategic projects. He drove numerous value enhancing initiatives over the last 10 years. Lubor Svoboda Founder, Chairman of Administrative Board Lubor has 14 years of top management experience in real estate and corporate acquisitions in the Czech financial and regulatory environment. Tomáš Novotný Member of Investment Committee Tomas has 12 years of experience in real estate with focus on logistics and industrial segment. His previous experience at P3 Logistics Parks and CTP includes both asset management and development of portfolios. Luděk Olexa Member of Investment Committee Ludek has over 15 years of experience in consulting and top management in ICT sector. He managed multiple strategic ICT projects and he was in charge of large international sales teams in CEE. Sushil Manmohan Shergill Member of Administrative Board Member of Investment Committee Sam has 20 years of experience in consulting and in media and marketing with leading multinational companies in Asia, U.S and Europe. Ondřej Pieran Representative of the Statutory Director Chairman of Investment Committee Ondrej has 6 years of experience in management of various funds focused on real estate and other alternative investments at the leading alternative investment fund manager in the Czech Republic. Karel Bartes Member of Investment Committee Karel s competencies and skills include strategic planning, CRM and project management. His 10 years of real estate experience covers private and institutional investors, qualified investors funds and stock exchange listed real estate funds. Bedřich Skalický Member of Investment Committee Bedrich has over 24 years of experience in real estate and investment. He was a manager in the real estate group at Deloitte and he set-up real estate funds CSIA and CSSG for Ceska Sporitelna Group. 2

Investment company Arete Invest CEE (Closed) Arete Invest (SICAV) Depositary bank, Custodian Arete Invest CEE II (Investment phase) Corporate tax 5% Fund Fund s legal form Regulatory body Fund s

4 Investment company Arete Invest CEE (Closed) Arete Invest (SICAV) Depositary bank, Custodian Arete Invest CEE II (Investment phase) Corporate tax 5% Fund Fund s legal form Regulatory body Fund s Manager / Administrator Depository bank Auditor ARETE INVEST investiční fond s proměnným základním kapitálem, a.s. Czech joint stock company with variable registered capital (SICAV) Czech National Bank AVANT investiční společnost, a.s. Česká spořitelna, a.s. Deloitte Audit s.r.o. Residential portfolio (sale ) Individual investments held by SPVs 19% Sub-fund Arete Invest CEE II investment strategy Arete Invest CEE II High income real estate in Central Europe (SPVs structure mitigating risks and optimizing portfolio) Currency EUR Pipeline for Arete Invest CEE II Investment shares Book-entry investment shares, ISIN: CZ Residential Office Retail Industrial/ Logistic Our Partners: Real estate market in Central Europe 3

5 Key performance indicators 2016 / Q / Q / Q / Q / Q / Q3 Assets under Management (AuM, mln) NAVPS ( ) * Total gross return 0.2% 2.6% 22.9% 2.3% 9.8% 2.8% Gross distributions available - 1.6% 1.4% 1.5% 1.5% 1.5% mln % %** + 2.8% 40.5% 40% % 26.7% ** 20% 0 0.2% 2.8% 2016 / Q / Q / Q / Q / Q / Q3 0% Assets under Management Cumulative gross return * Shares split (1:100) carried out in February 2017 for more flexibility of interim distributions to investors. ** Deviation is caused by postponed distributions to investors due to the statutory audit of the Annual Accounts. 4

6 Actual total gross return high above market benchmarks. Our investments into high income real estates overperform hurdle rate as well as chosen investment means. Current gross return is: 2x our initial 11% p.a. estimate of return 12x yield of US treasury 10year bonds + 2.8% 37.7% % 20.0% 16.5% 9.0% 3.2% 2016 / Q / Q / Q / Q / Q / Q3 Current cumulated gross return Targeted cumulated gross return Cumulated hurdle rate Cumulated yield of US treasury 10y bonds 2 Cumulated growth of S&P Hurdle rate is preferential gross return on investment, amounts to 6% p.a. 2. Indexed, values as of 30 June 2016 used as a base. 3. Including distributions to investors in 2017/Q1 and 2017/Q2 postponed due to the statutory audit of the Annual Accounts. 5

7 2017 / Q3 Assets under Management Gross rental yield p.a. 8.4% Structure of tenants by industry With 100% occupancy more than 90% of our leasable areas rented to A-Class multi-national tenants Occupancy 100% Total leasable areas (sqm) Total freehold land plots (sqm) % 5% 49% Warehousing and logistics Automotive Fashion retail thereof available for expansion (sqm) % Packaging materials manufacturing Lovosice Split of gross rental yields Prague Písek Uherské Hradiště Bratislava Žilina Nové Mesto nad Váhom 67% 33% CZK EUR 6

active in plastics manufacturing Expansion project being designed Písek I 4.

automotive manufacturing New development in preparation, new tenants under

Arete Gama Logistic centre with mix of international tenants (Fiege, PST

8 Uherské Hradiště 1. Arete Alfa Forschner manufacturing facility International A-Class tenant active in plastics manufacturing Expansion project being designed Písek I 4. Arete Epsilon CSS Spedition logistic centre (regional strong player in logistics) Lovosice II Lovosice I 2. Arete Beta Fukoku manufacturing facility International client active in automotive manufacturing New development in preparation, new tenants under negotiations 3. Arete Gama Logistic centre with mix of international tenants (Fiege, PST CLC, NCH Distribution) Complete renovation finished Tenant mix optimization initiated Písek II Lovosice Prague Písek 5. Arete Eta CSS Spedition logistic centre (regional strong player in logistics) Complete renovation finished Uherské Hradiště 7

9 Žilina 6. Arete Alfa SK Grupo Antolin manufacturing facility International client active in car interiors manufacturing Nové Mesto nad Váhom II 8. Arete Eta SK C&A and Vetropack value-added logistic centres International clients active in clothing retail and glass packaging manufacturing New development including new tenants under negotiations Nové Mesto nad Váhom I 7. Arete Gama SK Raben Logistic centre International client active in logistics New development including new tenants under negotiations Bratislava Žilina Nové Mesto nad Váhom 8

Investment ready Due diligence Financing and purchase agreement prepared Investment

management strategy and cash-flow Capital call letter sent to individual investors based

dedicated escrow account Purchase price settled as given in transactional documents

10 Investment ready Due diligence Financing and purchase agreement prepared Investment memorandum sent to call capital Investors provided with property details including management strategy and cash-flow Capital call letter sent to individual investors based on their commitments Transaction carried out Equity and bank financing transferred to dedicated escrow account Purchase price settled as given in transactional documents Transaction carried out Hand over of the SPV and real estate Set-up of processes, integration into portfolio 9

11 Purchase price 10.0m Gross yield 8.5% Net Operating Income (NOI) 7.1% Bank loans 60.0% Bank loan interests 3.2% NOI after interests 5.2% Equity invested 40.0% Gross return on equity 13.0% Asset management fee 1.5% Targeted gross return 11.5% We invest in: High-income generating properties with Positive and stable cash flow since day 1 Projected gross return above 8% p.a. Mid- to long-term tenants A-class properties Well-located near highways and main transport routes With good availability of labour Properties with potential for growth / improvement Having plots available for expansion (with construction permit) Having opportunity to renegotiate contract terms 10

Documents for a new investor Documents for a new qualified investor as defined by regulatory requirements

be sent as soon as a new investment is ready Notice provides all details of a capital call Emission of

Investment shares will be added to securities account Interim cash distributions and reporting Investor

12 Documents for a new investor Documents for a new qualified investor as defined by regulatory requirements Framework agreement describing total investor s commitment Capital call notice Capital call notice will be sent as soon as a new investment is ready Notice provides all details of a capital call Emission of book-entry investment shares Investment shares will be issued based on actual NAV of the sub-fund Investment shares will be added to securities account Interim cash distributions and reporting Investor is entitled to interim cash distributions Regular quarterly reports with sub-fund s results and audited annual reports 11

13 Sub-fund s investment strategy High income real estate in Central Europe (SPVs structure mitigating risks and optimizing portfolio) Sub-fund s expected lifespan 5-7 years from the sub-fund formation (exit in ) Investment mean (EUR only) Equity commitment agreements; individual Capital calls (till February 2019) Lock-up period 3 years from the formation of the sub-fund (till March 2019) Minimum commitment EUR Entry fee Asset management fee Hurdle rate Targeted return Performance fee 1 Interim distributions 2 Exit fee NAV calculation 2% (based on investment amount) 1.5% p.a. (based on the sub-fund s capital, borne by the sub-fund) 6% p.a. (based on net called capital) 11% p.a. 20% (6% < IRR 10% p.a.) 25% (IRR > 10% p.a.) Up to 6% p.a. Until 02/2020: 30%; 02/2021: 15%, and from 03/2021: 0% of value of investment shares Monthly (end-of-month) Note: The fee structure is available upon request as a part of the sub-fund s term sheet. 1. Performance fee is calculated based on the total gross investor s yield (IRR) above hurdle rate. 2. Interim distributions to investors are done through voluntary buy-backs of investment shares on quarterly basis. 12

14 Arete Invest prepared this document with due care from available information; however, Arete Invest does not accept any liability for the content of or interpretation of information contained in this document. Arete Invest makes no representation or any other form of assurance with respect to accuracy and completeness of this document. Arete Invest is not obligated to update, adjust or complete this document or notify its readers of any changes in the facts described herein or in any statements, outlooks or estimates contained herein or of any facts that cease to be correct. Neither Arete Invest nor any of its respective directors, officers, employees or advisers, nor any other person, shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on any information from this document; any such liability is expressly disclaimed. All investors (including potential ones) must rely on their own inspections, financial plans and conclusions. Each investment involves risk, and potential risk may rise commensurate to increasing returns. In some cases, the initial investment may not be fully recovered. Past performance is not necessarily indicative of future performance. Information specified herein does not serve as an investment guide and does not represent any investment, legal or tax recommendation. Before making any decision on an investment, investors are advised to review the fund s detailed information about its investment strategy and related risks. Arete Invest is a fund for qualified investors only. To become an investor in our fund, you have to be a qualified investor as specified by 272 of the Act no. 240/2013 Sb., on Investment companies and investment funds, as amended. This document does not represent a proposal for sale or an investment advice and its sole purpose is to provide information. This document and its content are confidential and may not be reproduced, distributed or passed, directly or indirectly, to any other party as a whole or in parts without the prior written approval of Arete Invest. 13

15 Contact details Phone: Arete Invest SICAV namesti 14. rijna 642/ Praha 5 Czech Republic Company ID: Arete Invest is regulated by the Czech National Bank, and it is open to qualified investors only.

Annual report NOVA Real Estate, investiční fond s proměnným základním kapitálem, a.s.

Annual report NOVA Real Estate, investiční fond s proměnným základním kapitálem, a.s. Annual report 2017 NOVA Real Estate, investiční fond s proměnným základním kapitálem, a.s. 1 ANNUAL REPORT CONTENT 1) REPORT OF THE STATUTORY DIRECTOR 2) PROFILE OF NOVA REAL ESTATE, INVESTMENT FUND 3)