interim financial results

interim financial results fr the 6 mnths ended 28 February 2018 2018 creating value beynd financial return

agenda 1 abut us 03 2 verview fr the perid 07 3 ur prtfli perfrmance 09 4 ur results 25 5 utlk 35 6 questins and answers 39 7 cntact details 40 8 appendices 41 2

abut us 1 Interim financial results 2018 creating value beynd financial return

abut us Listed n the JSE in 1990: REIT status n 1 September 2013 309 prperties (including jint ventures) in prtfli Prperties managed by City Prperty Administratin (Pty) Ltd Over 40 years prperty management experience Slid track recrd f managing residential, retail, ffice and industrial prperty The strategy remains the same Fcus n Tshwane and Jhannesburg CBDs Cntinually imprving the quality f ur prtfli Fcus n grwing ur residential prtfli Cntinue t fcus n the lw t mid incme LSM 2017 Jeff s Place 4

verview f Tshwane Cncentratin f investments Increased urbanisatin New develpments imprving nde New Tshwane Huse GLA f 37 000 m2 Husing in excess f 1 500 staff Sustaining city life: TWO decades f building a city bears fruit 1 094 219 m2 Octdec prperties in Tshwane CBD 520 745 m2 Octdec prperties in Tshwane 1 094 219 m2 5

verview f Jhannesburg Urban renewal gaining mmentum Increasing private sectr investment Higher demand fr prperty Lcal cuncil supprt 557 631 m2 Sustaining city life: TWO decades f building a city bears fruit Octdec prperties in Jhannesburg CBD 415 574 m2 Octdec prperties in Jhannesburg 557 631 m2 6

verview fr the perid 2 Interim financial results 2018 creating value beynd financial return

verview fr the perid Dividend f 101.7 cents per share, fr the six mnth perid ending 28 February 2018, cmpared t the prir perid f 104.8 cents per share Ttal prperty assets (incl. f JV s) value at R12.9 billin, up by R127.9 millin NAV f R29.62 per share Cntext Residential increasingly cmpetitive but demand is strng Tugh ecnmic, plitical and perating envirnment Rising csts (finance, utility and assessment rates and perating csts) Cuncil service delivery issues Difficult cnstructin envirnment Prgress Prperty fundamentals sund Strategic greenfield develpments t uplift key Tshwane CBD nde Prfitable recycling f nn-cre assets Imprved balance sheet Prudent capital management 8

ur prtfli perfrmance 3 Interim financial results 2018 creating value beynd financial return

prtfli analysis: rental incme 28 February 2018 Rental incme (%) by gegraphical lcatin Rental incme (%) by sectr % 35 30 25 20 % f ttal prtfli 21.2 33.2 36.9 % FY2017: 37.1% 10.6% shpping centres FY2017: 10.0% 26.3% Retail shps FY2016: 27.1% Retail 30.5 % FY2017: 29.5% Residential 15 12.5 12.7 10 5 0 4.0 Waverley, Gezina, Mt 4.3 Silvertn and surrunding areas 5.0 Tshwane Arcadia 7.1 Tshwane Hatfield Jhannesburg and surrunding areas Tshwane Other Jhannesburg CBD Tshwane CBD 7.5 % FY2017: 8.2% Industrial 4.4 % FY2017: 4.1% Parking 20.7 % FY2017: 21.1% Offices 10

prtfli analysis: GLA 28 February 2018 GLA (%) by gegraphical lcatin GLA (%) by sectr 40% 35% 30% 25% 20% 15% 10% 5% 0% 3.7 4.2 4.6 5.9 7.1 8.6 9.2 25.2 31.5 30.8 (FY17: 30.6) 5.6 (FY17: 5.5) 15.9 (FY17: 16.3) Waverley, Gezina, Mt Tshwane, Hatfield Tshwane, Arcadia Tshwane West Silvertn and surrunding areas Jhannesburg and surrunding areas Tshwane Other Jhannesburg CBD Tshwane CBD 23.7 (FY17: 23.9) Residential Retail: shps Offices Retail: shpping centres Industrial 24.0 (FY17: 23.7) 11

residential Prtfli sectrs: Rental incme (%) 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 2018 Tshwane Sharn s Place Number f prperties 73 74 Number f residential units Jhannesburg Tshwane 9 481 36% 64% Average mnthly rentals: R3 400 R3 900 fr a bachelr unit (average size 27 m 2 ) R4 100 R4 600 fr a ne-bedrm unit (average size 43 m 2 ) R5 400 R5 900 fr a tw-bedrm unit (average size 63 m 2 ) 9 483 36% 64% Grss lettable area (GLA) 396 962 m 2 394 721 m 2 Rental incme R230 millin R445 millin Grwth in rental incme like-fr-like* 1.4% 2.5% Ttal vacancies at perid end (% f GLA) 8.7% 12.3% Cre vacancies (% f GLA) 5.4% 7.2% * 30.5 % Rental incme 1.4 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 12

residential (cntinued) Tenant prfile analysis, fr applicatins during the perid Emplyed by gvernment 29% f ccupants Students 38% f ccupants Churn at 45% per annum Average grss salary per applicatin f R28 000 Grss salary abve R35 000 23% f ccupants Strng demand fr residential units Vacancies higher during perid due t: Ttal vacancies include 315 units at Sharn s Place Increased cmpetitin in Hatfield and Jhannesburg CBD Affrdability a cncern in the tugh ecnmic envirnment Bad debts write-ffs belw 1% reflect strng cllectin and credit management Respnse t tugh perating envirnment zer depsit fr selective buildings * Prtfli sectrs: Rental incme (%) 2018 Tshwane Sharn s Place 30.5 % Rental incme 1.4 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 13

retail shps Prtfli sectrs: Rental incme (%) 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 2018 Tshwane CBD Grss lettable area (GLA) 390 556 m 2 398 105 m 2 Rental incme R198 Millin R385 Millin Rental incme grwth (like-fr-like)* 4.3% 5.7% Ttal vacancies (% f GLA) 9.2% 10.8% Cre vacancies (% f GLA) 9.2% 9.2% 39% f ur Retail shps are in Tshwane CBD and 22% in JHB CBD Strng demand in well lcated CBD retail nde CBD retail ffers mre grwth pprtunities than traditinal shpping centres Increasing number f rental freezes and larger tenant installatins Lwer cst structures (cmmn area, security, cleaning) * 26.3 % Rental incme 4.3 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 14

retail shps (cntinued) Tp 10 retailers by lettable area Tp 10 retailers by rental (September 2017 t February 2018) (R 000) Lessee GLA Lessee Rental Prtfli sectrs: Rental incme (%) 2018 Tshwane CentreWalk Shprite Checkers 43 333 Pepkr 15 313 Pepkr 16 841 Shprite Checkers 15 294 Edcn Jet 13 647 Edcn Jet 7 919 Bidvest 11 886 Bidvest 6 824 Standard Bank 9 591 Fschini Retail Grup 6 269 Mr Price Grup 6 342 Standard Bank 5 756 Fschini Retail Grup 6 331 Nedbank 4 888 AutZne 5 501 KFC 4 504 Nedbank 5 037 Mr Price Grup 4 438 Cambridge Fd 4 489 FNB 3 945 Ttal 122 998 Ttal 75 150 26.3 % Rental incme 4.3 % Grwth in rental incme 15

retail: shpping centres 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 Prtfli sectrs: Rental incme (%) 2017 Tshwane Waverley Plaza Grss lettable area (GLA) 92 198 m 2 91 867 m 2 Rental incme R80 Millin R153 Millin Rental incme grwth (like-fr-like) 7.0% 6.4% Ttal and cre vacancies (% f GLA) 6.2% 4.6% We have six high-quality neighburhd / cnvenience shpping centres: Jhannesburg: Killarney Mall and the Wdmead Value Mart Tshwane: Elardus Park, Waverley Plaza, Gezina City and Blaauw Village (50% held JV) All perfrmed abve expectatins Strng like-fr-like grwth partly due t higher average vacancies in the prir cmparative perid 10.6 % Rental incme 7.0 % Grwth in rental incme 16

retail: shpping centres (cntinued) Prtfli sectrs: Rental incme (%) Elardus Park Shpping Centre Increase in vacancies t 9% In need f an upgrade 2017 Wdmead Value Mart Wdmead Value Mart Increase in vacancies Rental grwth f 10% Killarney Mall Occupancy levels stable Fcus n imprving tenant mix Waverley Plaza, Gezina and Blaaw Village N vacancies Gd grwth in rental 10.6 % Rental incme 7.0 % Grwth in rental incme 17

ffices Prtfli sectrs: Rental incme (%) 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 2018 Jhannesburg Killarney Mall Let t gvernment (% f ttal rental incme frm ffices) 41.3% 42.2% Other (% f ttal rental incme frm ffices) 58.7% 57.8% Grss lettable area (GLA) 509 084 m 2 509 848 m 2 Percentage f ffice space in develpment / mthballed (pprtunities t sell, develp r enter int partnerships) 22.2% 21.8% Rental incme R156 Millin R328 Millin Grwth in rental incme like-fr-like* 2.5% 8.4% Ttal vacancies at perid end (% f GLA) 37.5% 36.7% Cre vacancies at perid end (% f GLA) 15.3% 14.9% * 20.7 % Rental incme 2.5 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 18

ffices (cntinued) Offices cmprise f Gvernment ffice space Crprates Smaller units ccupied by SME s Ø Occupancy levels stable Upgrading f ffices Nrth City Braamfntein upgrade amunting t R35 millin Luis Pasteur Hspital Tshwane CBD upgrade f Cmmn areas amunting t R12 milllin Braam Fisher Jhannesburg CBD upgrade ahead f tenant lease amunting t R7 millin Prtfli sectrs: Rental incme (%) 2018 Jhannesburg Killarney Mall * 20.7 % Rental incme 2.5 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 19

industrial 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 GLA in Tshwane 217 669 m 2 217 090 m 2 GLA in Jhannesburg 45 381 m 2 53 431 m 2 Ttal GLA 263 050 m 2 270 521 m 2 Rental Incme R56 millin R115 millin Grwth in cre rental incme like-frlike* Ttal and cre vacancies at perid end (% f GLA) 0.8% 5.8% 14.5% 12.3% Prtfli sectrs: Rental incme (%) 2017 Transpharm, a divisin f Shprite * 7.5 % Rental incme 0.8 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 20

industrial (cntinued) Successful redevelpment f prperties demand fr upgraded prperties Achieving higher rentals after upgrades Upgrade largely tenant driven The Tannery Industrial Park (R14m) imprved ccupancy and rentals achieved Our cmpetitive advantage Lwer cst f ccupatin in desirable areas Prtfli sectrs: Rental incme (%) 2017 Transpharm, a divisin f Shprite * 7.5 % Rental incme 0.8 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 21

parking Prtfli sectrs: Rental incme (%) 6 mnths 28 Feb 2018 12 mnths 31 Aug 2017 2018 Tshwane Parking Average mnthly residential rentals (per bay) Average mnthly cmmercial rentals (per bay) R395 R675 Fcused strategy t increase the number f parking bays in the CBD, due t high demand Strng demand frm gvernment and residential tenants Greater fcus n increasing revenue thrugh imprved efficiencies R380 R650 Rental incme R33 millin R62 millin Grwth in cre rental incme like-frlike* 9.6% 4.6% * 4.4 % Rental incme 9.6 %* Grwth in rental incme Like-fr-like rental incme grwth, after taking int accunt ccupancy levels, reversins and escalatins fr the six-mnth perid, assuming n majr develpment activity 22

vacancies by sectr as at 28 February 2018 Ttal vacancies in ur prtfli as at 28 February 2018 were at 18.5% f ur ttal GLA (31 August 2017: 19.0% f ur ttal GLA) Cre vacancies were at 10.8% f ttal GLA (31 August 2017: 10.7%) Cre vacancies reduced mainly in the residential sectr (mainly Hatfield and Tshwane CBD) Residential ttal vacancies include Blcks A and C f Sharn s Place Mthballed ffice vacancies f 112 869 m 2 fr future redevelpment, partnerships r dispsal pprtunities Ttal vacancies % Cre vacancies % Offices 37.5 15.3 Retail shps 9.2 9.2 Retail shpping centres 6.2 6.2 Industrial 14.5 14.5 Residential 8.7 5.4 Ttal 18.5 10.8 31 August 2017 Offices 36.7 14.9 Retail shps 10.8 9.2 Retail shpping centres 4.6 4.6 Industrial 12.3 12.3 Residential 12.3 7.2 Ttal 19.0 10.7 Nte: Ttal vacancies include mthballed prperties held fr develpment which ffer significant redevelpment, partnership r dispsal pprtunities. The value f these vacancies will be realised ver time. Cre vacancies exclude lettable area f prperties that are mthballed. 23

lease expiry prfile Octdec s prtfli features a mix f shrt- t lng-term leases with the majrity f shrt-term leases prviding fr a mnthly agreement at expiry, which is typical f the residential market and leases with small t medium sized enterprises Gvernment leases cncluded fr 3- t 5-year term n average Residential leases shrt term leases (12 mnth cntracts prviding fr a mnth t mnth arrangement n expiry) Majrity f leases fr nn-natinal tenants cncluded fr 1- t 10-year term Natinal tenants leases cncluded fr 3- t 10-year term Residential (12 mnths and less) Grss lettable area m² GLA (%) Mnthly cntract ual rent R 000 Rental incme (%) 362 573 21.9 36 175 29.4 Mnthly cmmercial 204 960 12.4 17 200 14.0 t 28 February 2019 290 928 17.6 24 601 20.0 t 28 February 2020 190 874 11.6 15 300 12.5 t 28 February 2021 150 554 9.1 15 677 12.7 t 28 February 2022 67 789 4.1 5 904 4.8 Thereafter 79 175 4.8 8 128 6.6 Vacancies 304 997 18.5 Ttal 1 651 850 100.0 122 985 100.0 24

ur results 4 Interim financial results 2018 creating value beynd financial return

achievements Distributin f 101.7 cents per share fr the six-mnth perid On track t achieve flat distributin grwth per share fr the twelve mnth perid, in line with guidance Net prperty expense t rental incme rati decreased t 28.3% (31 August 2017: 30.9%) Arrears and dubtful debt prvisins remain at acceptable levels despite a challenging perating envirnment Bad debts and mvements in dubtful debt prvisins as a percentage f rental incme 1.2% (31 August 2017: 0.9%) Tenant arrears at 3.8% f grss revenue (31 August 2017: 3.9%) Balance sheet: Lan t value rati f 37.1% (31 August 2017: 37.1%) Prceeds frm dispsal f prperties f R43.8 millin Increase in net asset value (NAV) t R29.62 per share Interest rate risk reduced 97.5% hedged thrugh interest rate swap cntracts Sme earnings enhancing upgrades t existing prperties recently cmpleted: Braam Fisher ffices JHB CBD The Tannery industrial Silvertn Tshwane Lister Building JHB CBD Imprved residential ccupancy levels 26

challenges Tugh ecnmic and perating envirnment Like-fr-like grwth in rental incme f 3.2%, under pressure Rise in csts (finance cst, utilities, assessment rates) Higher interest rates (all-in weighted average cst f funding at 9.2% at 28 February 2018) Cre vacancies in prtfli (excludes prperties held fr redevelpment) at 10.8% (31 August 2017: 10.7%) Dilutinary impact in the shrt term n distributin grwth due t: Let-up phase f new residential develpments Majr upgrades t prperties Prperties acquired with vacancies, fr redevelpment Cuncil service delivery challenges 3.2 % like-fr-like grwth in rental incme 27

distributable earnings simplified incme statement % Change 6 mnths 28 February 2018 R 000 6 mnths 28 February 2017 R 000 Revenue earned n cntractual basis 3.5 929 656 897 813 Like-fr-like rental incme grwth f 3.2% Prperty perating csts 2.2 (410 790) (402 130) Increased efficiencies Net rental incme frm prperties 4.7 578 866 495 683 Administrative csts 38.7 (52 238) (37 660) Once ff csts f R11.6m (2018) Operating prfit 1.9 466 628 458 023 Interest incme 9 498 8 404 Lan advanced t JV partners Share f incme frm jint ventures 8 522 6 611 4 equity accunted JVs Distributable prfit befre finance csts 2.5 484 648 473 038 Finance csts 7.5 (213 869) (198 901) Increase in interest rate and lans Distributable incme befre taxatin (1.2) 270 779 274 137 Taxatin Equity hlders distributable earnings (1.2) 270 779 274 137 Number f shares in issue ( 000) 266 198 261 539 Dividend per share (cents) 101.7 104.8 % change in distributin (3.0) 28

cndensed cnslidated statement f financial psitin Unaudited 28 February 2018 R 000 Audited 31 August 2017 R 000 ASSETS Nn-current assets 12 739 824 12 568 875 Investment prperties 12 331 263 12 153 834 305 prperties 2018 311 prperties 2017 Plant and equipment 4 530 5 300 Straight-line rental incme accrual 111 998 110 864 Tenant installatin and lease csts 40 315 44 550 Other financial assets 75 000 75 000 Derivative financial instruments 3 281 1 847 Investment in jint ventures 173 437 177 480 4 equity accunted JVs - 50% held Current assets 457 949 560 397 Trade and ther receivables 137 026 145 291 Bank and cash 78 123 130 756 Nn-current assets held fr sale 242 800 284 350 Prperties recmmended fr sale at 28 February 2018 TOTAL ASSETS 13 197 773 13 129 272 EQUITY AND LIABILITIES Equity 7 884 600 7 828 229 Stated capital 4 210 134 4 221 477 Nn-distributable reserves 3 327 048 3 269 053 Retained earnings 347 418 337 699 Nn-current liabilities 4 218 706 3 381 370 Interest-bearing brrwings 4 093 637 3 253 517 Derivative financial instruments 44 591 47 421 Deferred taxatin 80 478 80 432 Current liabilities 1 094 467 1 919 673 Interest-bearing brrwings 739 050 1 572 817 2018 Cmmercial paper ntes Nn-interest bearing brrwings 354 215 342 548 Derivative financial instruments 1 202 4 308 TOTAL EQUITY AND LIABILITIES 13 197 773 13 129 272 Shares in issue ('000) 266 198 266 864 Net asset value (NAV) per share (cents) 29.62 29.33 Lan t investment value (LTV) rati (%) 37.1 37.1 29

cash flw fr the perid ended 28 February 2018 R'000 900 000 700 000 500 000 300 000 100 000 130 756 495 024 (213 537) (262 328) 19 159 42 491 (109 293) (11 343) 6 353 78 123-100 000-300 000 Balance 1 September 2017 Cash generated frm peratins Net finance csts Dividend paid Net cash inflw frm perating activities Prceeds frm dispsal f investment prperty Imprvements t investment prperty Shares repurchased Increase in interest bearing brrwings Balance end f perid 30

capital management funding at 28 February 2018 Prudent management f debt LTV at 37.1% (target f 35%) Interest rate hedging 97.5% maintain at levels f at least 70% 80% Practively address expiries f lans and swaps in the 2018 FY Cntinue t pay dwn debt thrugh sales f nn-cre prperties Unutilised banking facilities in excess f R800 millin R Millin R Millin Interest rate Ttal brrwings Banks 3 705.5 9.2% DMTN prgramme 1 127.2 8.4% TOTAL BORROWINGS 4 832.7 9.0% Cst f swaps 0.2% TOTAL BORROWINGS 4 832.7 9.2% Lan t value 37.1% Weighted average cst f brrwings all-in cst, including swaps 9.2% Interest rate hedging percentage f brrwings 97.5% Weighted average term f fixed rate lans/swaps Weighted average term f debt 1.6 years 1.3 years 31

funding as at 28 February 2018 28 February 2018 Standard Bank R1 327m (28%) DMTN Prgramme R1 127m (23%) 31 August 2017 Standard Bank R925m (19%) DMTN Prgramme R1 116m (23%) Nedbank R2 379m (49%) Nedbank R2 785m (58%) 32

interest bearing debt expiry prfile as at 28 February 2018 Expiry prfile per financial year (Rm and %) Rm 2500 Secured lans Crprate paper Debt maturing in the next 12 mnths: 2000 1500 1000 500 0 739 T be updated 2 028 230 844 158 834 Shrt term brrwings are cmmercial paper (DMTN prgramme) f R739m T date, R260m f the cmmercial paper ntes have been successfully refinanced fr a 12-mnth term at an all-in cst f 135 bps abve JIBAR Weighted average term f lans Currently 1.3 years Befre 31 August 2018 term ut t > 2 year term Higher cst f interest anticipated 31 Aug 2018 31 Aug 2019 31 Aug 2020 31 Aug 2021 33

interest rate hedges expiry prfile Expiry prfile per financial year (Rm and %) Rm 2 000 1 800 1 600 1 400 1 200 1 000 800 600 400 200 0 1 750 500 1 361 1 101 31 Aug 2018 31 Aug 2019 31 Aug 2020 31 Aug 2021 Fixed rate lans R412 millin Swaps ttal f R4.3 billin Average weighted expiry 1.6 years At 31 August 2018, interest rates in respect f 97.5% f brrwings hedged R1.1 billin f cntracts expiring prir t 31 August 2018 Reducing hedged psitin t 75% R500 millin f swap cntracts cmmenced effective frm February 2018 Weighted term 3 years Jibar f 7.015% 34

utlk 5 Interim financial results 2018 creating value beynd financial return

utlk Imprvement in business and cnsumer cnfidence Increasing cmpetitin CBD Jhannesburg and Hatfield (residential) Strng peratinal fcus t cntinue Well-psitined t cntinue t take advantage f pprtunities in the CBDs CBD retail cntinues t generate strng demand frm natinal and independent tenants Strng demand fr affrdable, secure and quality residential accmmdatin Residential develpments t significantly uplift the Tshwane CBD nde where we have a strategic cncentratin f assets Sharn s Place letting well abve expectatin Explring new CBD pprtunities 36

utlk (cntinued) Cntinue t unlck value future develpment pprtunities under discussin Hurdle yield required f abve 8.5% Dispsal f nn-cre r nn-perfrming prperties will remain a fcus area New five-year management cntract cncluded with City Prperty Circular t be sent t sharehlders Subject t sharehlders apprval Separate sub-cmmittee frmed cmprising f nn-executive directrs PWC independent advisrs t sub-cmmittee N impact n earnings Frecast Impact n distributins during let-up phase Current frecast grwth in distributable incme per share N grwth fr 2018 FY Psitive grwth in 2019 FY 37

investment case Strategy t remain the same Sustainable mdel urban renewal and middle-class grwth Well-balanced prtfli with significant synergies acrss sectrs in the CBDs Strng ptential develpment pipeline unlck value f current prtfli (new and redevelpments) Prven track recrd hands-n apprach delivering steady returns Well-psitined t cntinue t unlck value and navigate the challenging ecnmic envirnment 38

questins and answers 6 Interim financial results 2018 creating value beynd financial return

cntact us www.ctdec.c.za 7 Jeffrey Wapnick Managing Directr Tel: +27 12 319 8708 e-mail: jeffw@ctdec.c.za Anthny Stein Financial Directr Tel: +27 12 319 8780 e-mail: anthny@ctdec.c.za 40

appendices 8 Interim financial results 2018 creating value beynd financial return

crprate structure as at 28 February 2018 39% Wapnick family & directrs 37% Institutinal investrs 24% Other Tp 5 Beneficial institutinal sharehlders 6.0% Nedbank Grup 5.6% Old Mutual Grup 3.9% Gvernment Emplyees Pensin Fund 2.8% Allan Gray 2.3% Mmentum 42

ur strategy Offer innvative prperty investment pprtunities that create and deliver lng-term sustainable returns by: Building a diversified prtfli in the Tshwane and Jhannesburg CBDs and surrunding areas with an expsure t residential, ffice, retail and industrial sectrs Actively prmting urban renewal in the Tshwane and Jhannesburg CBDs Increase the prfitability f ur existing prtfli by: Cntinually imprving the quality f ur prtfli Enhancing ur tenant prfile Develping well-lcated prperties Cncentratin f prperties in Tshwane and Jhannesburg CBDs, which makes it easier t manage and extract value frm ur prtfli Pursuing acquisitins that ffer strategic value and sustainable yield-enhancing pprtunities Fcusing n grwing ur residential prtfli in the medium term Recycling capital frm lw grwth, pr quality assets t high grwth, high quality assets Enhancing returns thrugh effective mix f debt and equity t ptimise capital structure Management f interest and liquidity risk 43

tp 10 prperties Accunt fr 25.0% f the Octdec investment prperty prtfli by value Prperty Lcatin Sectr Size (m 2 ) The Fields Hatfield, Tshwane Mixed use 53 888 Killarney Mall Killarney, Jhannesburg Shpping centre 46 945 Centre Walk Tshwane CBD Mixed use 25 407 Wdmead Value Mart Wdmead, Jhannesburg Shpping centre 18 093 Kemptn Place Kemptn Park Mixed use 32 699 Sharn s Place Tshwane CBD Mixed use 19 146 Luis Pasteur Medical Tshwane CBD Mixed use 24 677 Nedbank Plaza Arcadia, Tshwane Mixed use 23 031 Steyn s Place Tshwane CBD Mixed use 15 638 Jeff s Place Tshwane CBD Residential 14 771 44

recent sales In line with ur strategy t dispse f nn-cre assets, the fllwing prperties were sld and transferred during the perid under review Prperty Lcatin Ttal cnsideratin R millin Prfit / (lss) n dispsal R millin Transfer date / expected transfer date Exit yield % Pretby Tshwane Other 3.2 (0.4) February 2018 7.1 Pretwade Wadeville Jhannesburg 10.5 February 2018 3.6 Sharp Centre Tshwane CBD 5.7 Octber 2017 10.0 Iskemp Isand, Jhannesburg 18.0 1.1 February 2018 1.2 119 & 121 Albertina Sisulu Jhannesburg CBD 5.6 0.2 December 2017 0.1 Grariv Units 24 and 42 Tshwane Other 0.8 0.1 December 2017 5.2 Ttal 43.8 1.0 7.1 The prfit n the dispsal cnsideratin f R43.8 millin amunted t R1.0 millin, a premium f 2.3% abve revalued bk value at 31 August 2017. The weighted average exit yield was 7.1%. A further 29 nn-cre prperties with a carrying value f R242.8 millin have been apprved fr dispsal by the bard. The average carrying value f these prperties is R8.4 millin. The prceeds frm prperty sales will be used t repay debt, as well as fund the develpment pipeline. 45

capital expenditure greater than R20 millin Management recgnises the need t imprve hurdle rates f returns and has taken a mre cautius apprach t develpment rll-uts ging frward Prperty Lcatin Details Ttal develpment cst R millin Cmpletin date Fully let yield % Sharn s Place Tshwane CBD 400 residential units, 5 660m 2 retail and 289 parking bays Nrth City Braamfntein Upgrade f ffice blck, including cmmn areas and facade 356 In phases - residential July 2017 - retail 7.3 35 June 2018 8.0 The impact f the let-up affects results negatively. The cnstructin f the residential develpment Reinsurance Huse is in the planning phase, which is situated in the Jhannesburg CBD. The ttal develpment csts is expected t be R110 millin. This develpment will nly cmmence if an acceptable yield is achieved at least 8.5% per annum. 46

sharn s place Tshwane CBD mixed use develpment Develpment cst f: R356m Residential units: 400 Retail: 5 660m² Parking bays: 289 Retail cmpleted in July 2017 Retail leasing prgressing well and is almst 100% let with anchr tenants including Shprite and Clicks Residential Blcks A and C due fr cmpletin in phases by June 2018 Residential Blck B cmpleted in February 2018 and fully let 2018 Sharn s Place 47

nrth city Office blck with retail situated in Braamfntein Upgrade cst: R35m Retail: 749m 2 Offices: 7 723m 2 Strng demand fr ffices Office rental f R110m 2 R115m 2 after upgrade Cmpletin f upgrade in June 2018 2018 Nrth City Street view 48