• 19/05/2017: Periodical press release : annual results on 31 March 2017

Periodical press release - regulated information‌‌

Ternat, 19 May 2017

A N N O U N C E M E N T O F A N N U A L RE S UL T S FO R FI N A N C I A L Y E A R 2 0 1 6 - 2 01 7 RE A L E S T A T E P O RT FO L I O I N C RE A S E S T O E U R 1 , 0 7 1 . 3 6 M I L L I O N

( + 7. 05 % )

E P RA E A RN I N G S * I N C RE A S E T O E U R 3 9 . 1 2 M I L L I O N (+ 7 . 2 4 % ) - P RO P O S E D D I V I D E N D I S E U R 3 . 3 0 ( + 3 . 1 3 % I N C RE A S E O V E R T H E P RE V I O U S FI N A N C I A L Y E A R )

O C C UP A N C Y R A T E RE M A I N S H I G H ( 9 8 . 1 3 % ) IN C L U S IO N IN E P R A IN D E X

*Alternative performance measures and the term "EPRA earnings"

Alternative performance measures are standards that Retail Estates nv uses to measure and track its financial performance. The measures are used in this annual report but are not defined in a law or generally accepted accounting principles (GAAP). The European Securities and Markets Authority (ESMA) has issued guidelines applicable from 3 July 2016 for the use and explanation of alternative performance measures. The terms considered by Retail Estates nv as an alternative performance measure are contained in the appendix to this press release. The definition, purpose and reconciliation of the alternative performance measures are foreseen as required by the ESMA Directive.

As a result of this directive, the previously used term "net current result" is no longer applicable. The designation has therefore been changed to "EPRA earnings". There is no substantive difference with the previously used term "net current result".

Periodical press release - regulated information

Ternat, 19 May 2017

ANNUAL RESULTS FOR THE PERIOD 01.04.2016 THROUGH 31.12.2017

1. Summary

   • Investments during the financial year of EUR 62.86 million in properties and projects. Disposals for a net sale price of EUR 9.72 million.

   • A reorganisation of the loan portfolio and an issuance of bonds results in an extension of the maturity of the loans and a decrease in the weighted average interest cost.

   • EPRA earnings are EUR 39.12 million (7.24%).

   • The proposed dividend per share is maintained and amounts to EUR 3.30.

2. Operational Activities

2.1. Acquisitions and disposals Investments - retail parks

Investments with a view to expanding the Wetteren retail park (Heerzele nv)

In 2014, Retail Estates nv acquired the retail park with 14 shops and a gross retail area of 10,423 m². The retail park that opened in 2008 is known as Frunpark Wetteren. It is very successful and attracts consumers from far and wide.

Retail Estates nv acquired controlling interest (51%) of real estate company Heerzele nv on 30 August 2016, which is owner of property in Wetteren on which, after obtaining the necessary permits, it wishes to expand its retail park in Wetteren.

The total operation consists of the creation of approximately 9,000 m² of gross retail space, a significant expansion of the car park, estimated annual rental income of EUR 0.90 million and an expected total investment of EUR 14.40 million.

Ideally, the completion time is 24 months, which means expected delivery by September 2018.

In accordance with the provisions of the relevant municipal spatial implementation plan, the shops are mainly for large-scale retail.

Wetteren (Blovan bvba)

On 31 January 2017, Retail Estates nv acquired a stake (50%) in a second real estate company, Blovan bvba, which owns a semi-logistics facility in Wetteren that is used for business-to- business trade.

The property is fully leased with an expected annual rental income of EUR 0.30 million until 2020. The investment value used as a reference for this transaction is EUR 4.74 million.

2

Westerlo (Oevel)

On 30 June 2015, Retail Estates nv acquired 9 properties in a retail park located at the Geel- West exit of the Antwerp-Liège motorway. This site includes 4 other properties belonging to third parties. The retail park has undergone a thorough renovation and will be commercialised in the course of 2017-2018.

With two consecutive transactions, Retail Estates nv acquired two of these four properties during the past financial year. This acquisition is intended to integrate these 2 retail properties into the retail park. On 25 October 2016, a shop in Westerlo of approx. 995 m² leased to bvba Merkkleding was purchased for EUR 1.98 million. Expected annual rental income amounts to EUR 0.12 million. Then on 14 December 2016, property located at Bell Telephonelaan 2/1, Westerlo, with an investment value of EUR 1.70 million, was acquired in the context of a contribution in kind. This comprises a shop leased to Action BVBA and a solar panel installation. Expected annual rental income amounts to EUR 0.11 million.

Hainaut

On 23 December 2016, Retail Estates nv acquired all shares of a real estate company that has 25 retail outlets spread across the province of Hainaut. All of these are leased to retail chains that mainly belong to the discount segment. Shop area has been leased for example to Lidl, Action, Chaussea, Trafic, Bel&Bo and Shoe Discount (Bristol).

The retail outlets have a total shop surface area of 25,738 m² and represent expected annual rental income of EUR 2.42 million. Gross initial return on the investment is 6.44%.

For more information, please see the press release of 23 December 2016, available on the Retail Estates nv website.

The purchase price of the shares of the real estate company in question was paid for half in cash, and an amount of EUR 11.33 million was paid by the issue on 5 April 2017 of 174,404 new shares that will share in profit from the financial year commencing on 1 April 2017.

Verviers (Foncière de la Station Vervietoise bvba)

On 6 January 2017, the Group acquired the grounds (property encumbered with a ground lease) of its retail park in Verviers by the acquisition of the real estate company Foncière de la Station Vervietoise bvba by Finsbury Properties nv (50%) and Retail Warehousing nv (50%) for an amount of EUR 0.37 million.

The above acquisitions were made at a valuation that corresponds to the fair value of the relevant shops or retail parks, as determined by real estate experts CBRE or Cushman & Wakefield or Stadim.

Project development

The project in Froyennes was completed on 30 September 2016. The new 1,500-m² retail building has been leased to Leen Bakker for an annual rent of EUR 0.13 million.

An existing shop in Sint-Stevens-Woluwe was renovated into two separate shops with surface areas of 1,027 m² and 1,042 m². This project was also completed on 30 September 2016. One unit was leased to Beter Bed, the other to Cool Blue, the market leader in online sales of electronics, and household and sporting goods, which is now also systematically opening physical shops. The total rent for both units is EUR 0.22 million.

In addition, the building in Verviers, a custom project of approximately 2,000 m² for chocolatier Darcis, was completed on 1 July 2016. This project is the object of a financial lease. The total investment amounts to EUR 1.03 million. This investment represents a strengthening of the retail park since an important hospitality sector function was added.

Finally, a building in Tienen (fair value EUR 3.95 million) and a shop in Westerlo (fair value EUR 1.74 million) were completed.

Optimisation of real estate portfolio

Retail Estates nv pays close attention to the changing needs of its tenants with respect to shop area. Several tenants are systematically expanding their product range and regularly request an expansion of their shop. This can take place through the acquisition of space from adjacent tenants who sometimes have too much, or by constructing a new addition to the shop. Sometimes a choice is even made for a combination of both.

Renovations sometimes include more than just an expansion of the retail area; Retail Estates nv makes regular use of renovation opportunities to also remove an existing shop façade and replace it with a contemporary version that better fits the tenant's image.

Such investments allow us to build "win-win" relationships with tenants. Available land is put to work, and revenue growth allows the tenant to pay the rent increase.

Disposals

In the past financial year, properties were divested for a net sale price of EUR 9.72 million. A net capital gain of EUR 0.28 million was realised on these disposals.

6 shop premises were sold for a net sales price of EUR 7.29 million. The sold properties are located in Aartselaar (1 property, 3,480 m²), Spa (1 property, 1,470 m²), Waregem (1 property, 999 m²), Mons (2 properties, 2,249 m²) and Eeklo (1 property, 104 m²). The fair value of these properties amounted to EUR 7.04 million at the time of sale.

In a notarial deed of 28 September 2016, the Distri-Land real estate certificate for the property located in Hasselt, leased to CarpetRight, was sold for a net sales price of EUR 2.41 million. The sales proceeds were paid to the depositary receipt holders on 30 September 2016. For this, Retail Estates nv received a net coupon of EUR 1.82 million.