Precinct Properties New Zealand : Convertible Notes Terms Sheet

INDICATIVE TERMS SHEET

Up to $150,000,000 subordinated convertible notes www.precinctnotesoffer.co.nz

Joint Lead Arrangers and Joint Lead Managers Joint Lead Managers

INDICATIVE TERMS SHEET

This terms sheet should be read together with the Product Disclosure Statement dated 25 August 2017 (PDS) for the offer of subordinated convertible notes by Precinct Properties New Zealand Limited (Offer). The PDS is available at www.precinctnotesoffer.co.nz or can be obtained from the Joint Lead Managers or your usual financial advisor. Investors must obtain a copy of the PDS before they apply for Notes.

Issuer Precinct Properties New Zealand Limited (Precinct).

Description Subordinated convertible notes (Notes). The Notes will Convert into ordinary shares in Precinct (Shares), subject to a Cash Election by Precinct, as described further below.

Purpose The proceeds of the Offer (net of issue costs) are to be used to repay existing bank debt, providing Precinct with flexibility and additional debt capacity to fund its future development pipeline and any other opportunities as they may arise.

No credit ratings The Notes will not berated.

Offer amount Up to $150 million, as describedbelow.

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Structure of the Offer The Offer consistsof:

• The Priority Offer of up to $25 million, which is open only to members of the public resident in New Zealand who are Shareholders (at the time of applying for Notes and on the Closing Date for the Priority Offer), excluding institutional Shareholders as determined by Precinct (New Zealand Retail Shareholders).

• The General Offer of up to $100 million (with the ability to accept oversubscriptions of up to

$25 million at Precinct's discretion). The General Offer is open to investors resident in New Zealand and certain overseas institutional investors.

If any amount of the Priority Offer is not taken up by the relevant Closing Date, Precinct may reallocate up to a corresponding amount to the General Offer at its absolute discretion.

How to apply New Zealand Retail Shareholders may apply for Notes in the Priority Offer online atwww.precinctnotesoffer.co.nz or otherwise as set out in the PDS.

All Notes (including any oversubscriptions) in the General Offer have been reserved for subscription by clients of the Joint Lead Managers, Primary Market Participants and other persons invited to participate in the bookbuild.

Issue price $1.00 per Note, being the Principal Amount of eachNote.

Term 4years.

Conversion Date 27 September 2021.

INDICATIVE TERMS SHEET

Conversion On the Conversion Date, all outstanding Notes will be Converted into Shares, subject to a CashElection.

The number of Shares into which each holding of Notes Converts will be determined by dividing their Principal Amount ($1.00 per Note) (together with any Unpaid Interest (including any interest thereon)) by the Conversion Price, which is the lesser of:

1. the Conversion Price Cap of $1.40; and

2. a 2% discount to the Market Price (calculated as per the statement below).

The Market Price is determined based on the arithmetic average of the daily volume weighted average price of Precinct ordinary shares traded through the NZX Main Board in the 20 Business Days prior to (but not including) the Conversion Announcement Date.

Please refer to the PDS for example scenarios of Conversion at different Market Prices.

Conversion Price Cap Adjustments

The Conversion Price Cap will be adjusted for bonus issues, rights issues, divisions and consolidations as described further in the PDS.

No adjustments will be made in respect of any actions pursuant to a dividend reinvestment plan, share purchase plan or for any placement undertaken in accordance with the Listing Rules (including any further issuances of convertible notes), or other transactions which may affect the price of the Shares (including, for example, any return of capital, buy back or any cash dividend paid by Precinct).

Cash Election Rather than Converting the Notes into Shares, Precinct may elect to instead pay a cash amountto

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Noteholders at the end of the term. In this case, Noteholders would be paid an amount equal to the Market Price (calculated as set out above) of all the Shares that would have otherwise been issued to them on Conversion of their Notes, so that they receive an equivalent value to those Shares (as determined under the terms of the Notes) and will similarly benefit from any appreciation of the Share price above the Conversion Price Cap of $1.40 prior to the Conversion Date.

Precinct may only elect to pay the cash amount if it is not insolvent and no event of default in respect of borrowed money is continuing (and Precinct would not become insolvent, and no such event of default would occur, as a result of making such payment) (the Payment Condition).

Early Conversion The Notes may be Converted before the ConversionDate:

• after an Event of Default;

• at the Noteholders' option after a Compulsory Acquisition Event; or

• at Precinct's option after a Tax Event, as described further in the PDS.

  A Compulsory Acquisition Event will occur if any person (or persons acting jointly or in concert) become bound, or become entitled and elect, to compulsorily acquire Shares held by minority Shareholders, whether following a takeover offer, a scheme of arrangement or otherwise (except for the interposition of a non-operating holding company or similar, as described further in the PDS).

  Broadly, a Tax Event will occur if there has been, or there will be, a change in New Zealand law applying after the Issue Date, as a result of which:

• any interest payable on the Notes is not, or will not be, allowed as a deduction for the purposes of New Zealand income tax; or

• Precinct would be, or is likely to be, exposed to any other adverse tax consequence in relation to any Notes,

provided such event is not minor and Precinct did not expect such event on the Issue Date. The Cash Election does not apply to any Conversion before the Conversion Date.

INDICATIVE TERMS SHEET

Interest Rate To be determined by Precinct in conjunction with the Joint Lead Arrangers following a bookbuild, and announced via NZX on or about the Rate Set Date.

The Interest Rate will be equal to the sum of the Swap Rate and the Issue Margin, subject to a minimum Interest Rate of 4.80% per annum.

Indicative Issue Margin The indicative Issue Margin is 2.25% to 2.45% per annum. The final Issue Margin (which may be above or below the indicative Issue Margin, subject to the minimum Interest Rate mentioned above) will be set by Precinct in conjunction with the Joint Lead Arrangers following completion of the bookbuild process and announced via NZX on or about the Rate Set Date.

Swap Rate The 4-year swap rate (adjusted to a quarterly basis as necessary) determined on the Rate Set Date by Precinct in conjunction with the Joint Lead Arrangers.

Interest Payment Dates Quarterly in arrear in equal amounts on 27 March, 27 June, 27 September and 27 December each year (or if that day is not a Business Day, the next Business Day) until and including the Maturity Date, with the first Interest Payment Date being 27 December 2017.

Interest payments may be suspended in certain circumstances as described below.

Early bird interest Precinct will pay interest calculated on a daily basis at the Interest Rate on application money, in respect of accepted applications, from (and including) the date that application money is received

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into the bank account for the offer to (but excluding) the Issue Date. Early bird interest will be paid

(less any withholding tax required to be deducted) as soon as practicable and, in any event, within 5 Business Days after the Issue Date.

Interest suspension Payments of interest on the Notes will be suspended if Precinct does not meet the Payment Condition (as described above) in respect of such interest.

Any suspended interest payment (Unpaid Interest) will accumulate and interest will accrue on it at the Interest Rate (compounding on each Interest Payment Date) until paid. No dividend or other return will be made to Shareholders while any interest on the Notes is suspended.

Unpaid Interest is required to be paid no later than 5 Business Days after Precinct meets the Payment Condition in respect of such interest. Any Unpaid Interest (including any interest thereon) will be added to the Principal Amount on Conversion.

Record Date 5pm (New Zealand time) on the date that is 10 days before the relevant Interest Payment Date or, if that is not a Business Day, the immediately preceding Business Day.

Brokerage 0.75% retail brokerage plus 0.50% on retail firm allocations paid byPrecinct.

ISIN NZPCTDG001C6

Quotation Application has been made to NZX for permission to quote the Notes on the NZX Main Board and all the requirements of NZX relating to that quotation that can be complied with on or before the date of distribution of this terms sheet have been duly complied with. However, the Notes have not yet been approved for trading and NZX accepts no responsibility for any statement in this terms sheet. NZX is a licensed market operator, and the NZX Debt Market is a licensed market, under the Financial Markets Conduct Act 2013.

NZX ticker code PCTHA has been reserved for the Notes.