Deutsche Konsum REIT : Compensation Report 2022/2023 incl. Report of the independent auditor

Report on the principles of the Company's Compensation System (Compensation Report under stock corporation law pursuant to

§ 162 AktG)

Denition of "granted and owed" within the meaning of § 162 (1) AktG

For the purposes of the following Compensation Report, benefits granted are defined as having been received in the financial year. Compensation is owed if the Company has a legally existing obligation to the board member which is due but not yet fulfilled. In financial years 2021/2022 as well as 2022/2023, DKR settled all obligations to its board members when due at the end of the month, so that the compensation "granted" in each of the financial years 2021/2022 and 2022/2023 is identical in amount to the compensation "owed" in each case, according to the definition chosen for the purposes of this Compensation Report.

In addition, the compensation earned by the Management Board members in the respective financial year is also presented. This comprises the fixed compensation agreed for the respective financial year, including fringe benefits, and the variable compensation calculated on the basis of target achievement, the short-term component (STI) of which is paid out in the following financial year and the long-term

component (LTI) of which is only paid out after three subsequent years.

Compensation System for the Supervisory Board

The members of the Supervisory Board receive a fixed cash compensation of TEUR 5 for each full financial year of service on the Supervisory Board. The Deputy Chairman receives 1.5 times this basic remuneration, while the Chairman of the Supervisory Board receives two times this amount. Deutsche Konsum takes out appropriate directors' and officers' liability insurance (D&O insurance) for the members of the Supervisory Board and pays the premium.

The members of the Audit Committee receive additional fixed remuneration of TEUR 2.5 for their work on the Audit Committee. The Chairman of the Audit Committee receives twice this basic remuneration each year, while the Deputy Chairman of the Audit Committee receives 1.5 times this basic remuneration each year. No other committees have been established and no attendance fees are granted. Variable compensation based on the performance of the Company or other criteria is not granted.

The compensation of the Supervisory Board (by definition, benefits granted and thus received) in financial year 2022/2023 amounted to TEUR 38.3 (2021/2022: TEUR 40.0) plus expenses. Supervisory Board compensation is distributed as follows:

In accordance with the recommendations of the German Corporate Governance Code, the compensation of the members of the Supervisory Board consists exclusively of fixed components plus reimbursement of expenses and insurance coverage, and not of variable components. The fixed compensation strengthens the independence of the Supervisory Board members and thus makes an indirect contribution to the long-term development of the Company.

Compensation System for the Management Board

Basic Compensation System

The members of DKR's Management Board receive a non-performance-related basic compensation as well as a performance-related variable compensation based on short-term and long-term targets. The former Chairman of the Management Board, Rolf Elgeti, was excluded from this Compensation System and received pro rata a lump-sum annual compensation of approximately TEUR 53.6 until 13 July 2023. The compensation is paid via an agreement with Obotritia Capital KGaA, as there was no employment contract between the Company and the former Chairman of the Management Board.

The non-performance-related basic compensation consists of the fixed annual salary, which is paid in twelve monthly installments. The Management Board members use company cars, which are taxed as non- cash benefits. In addition, allowances are paid for pension insurance. No other benefits are granted as other compensation. The Management Board contracts do not establish pension entitlements.

For the variable compensation, there is a Compensation System which is based on operational targets and which is fundamentally based on a fixed calculation scheme that includes short-term and long-term com- ponents. Only in exceptional cases, the Supervisory Board can resolve something different with regard to special situations and/or special performance of the individual Management Board member. The Supervisory Board may also change the weighting of individual criteria in the event of exceptional developments. In the event of the regular departure of a Management Board member, he or she is entitled to payment of the variable compensation components to which he or she is entitled but which have not yet been paid out. There are no further claims in the event of regular departure.

In the event of other early termination of employ- ment, the contracts of the members of the Management Board contain the provision that payments may not exceed the value of two years' compensation (severance cap). When calculating the severance payment cap, the variable remuneration components are generally based on the previous financial year and the fixed variable remuneration is therefore extrapolated to two full years. If the variable remuneration set by the Supervisory Board for the current financial year, assuming 100% target achievement, is higher than that achieved in the previous financial year, both the bonus for the previous financial year and the bonus for the current financial year must be taken into account equally in the calculation.

In this case, a target achievement of 100% is to be assumed for the current financial year, unless it is clear that this level will not be achieved (for which the company bears the burden of proof). If it is likely that the targets will be achieved by more than 100%

in the current financial year, the Supervisory Board may take this into account accordingly up to the agreed cap on the bonus of 150%. It is obliged to do so if it is sufficiently certain that the targets will be exceeded.

In the event of a change of control, i.e. if a shareholder or several shareholders acting jointly acquire at least 30% of the voting rights in DKR, the members of the Management Board have the right to resign from the Management Board with a notice period of two months to the end of the month and to terminate their employment contract at the same time. If this special right of termination is exercised, the Management Board member is entitled to a severance payment due at the time of his departure, which corresponds to the remuneration to be paid by the company during the remaining term of the employment contract, up to a maximum of the severance payment cap.

Variable compensation for nancial year 2022/2023

Against the background of the 2017 update of the German Corporate Governance Code ("GCGC"), which recommends a multi-year,forward-looking assessment basis with regard to variable compensa- tion, the Supervisory Board addressed an update of the variable compensation of the Management Board in October 2017 and resolved a new arrangement at its meeting on 8 March 2018, which has been valid since the 2017/2018 financial year.

By resolution of the Supervisory Board of 16 Decem- ber 2020, the target weighting of the variable compensation of the Management Board was aligned to the focus on FFO growth and the achievable variable compensation was increased due to the growth in the size of the Company. Furthermore, the Compensation System was adjusted with regard to the long- term variable compensation component in line with the current recommendations of the GCGC, which make the variable compensation of the Management Board even more long-term. By further resolution of the Supervisory Board on 13 December 2021, a minor

modification was made to a target indicator: Due to a redefinition by EPRA, instead of an increase in EPRA NAV per share, the focus is now on an increase in EPRA NTA per share. By resolution dated 15 Decem- ber 2022, the target achievement levels for FFO per share and EPRA NTA per share were lowered.

Accordingly, the following equally weighted targets were used as the basis for variable Management Board compensation in the Supervisory Board solution in the past financial year 2022/2023:

• Increase in share price by 20% in the financial year (after elimination of the dividend paid in the financial year),
• Increase in EPRA NTA1 per share by 10% in the fi- nancial year (after elimination of the dividend paid in the financial year), (previous year: 20% in the financial year),
• Increase in FFO per share (excluding sales) by 5% in the financial year (previous year: 20% in the financial year).

In the event of full target achievement (100%), the Supervisory Board has set variable compensation of TEUR 125.0 (previous year: TEUR 125.0) per Management Board member for financial year 2022/2023. If this target is exceeded, the variable compensation increases in proportion to the degree of target achievement, but amounts to a maximum of TEUR 187.5 ("cap").

The resulting variable compensation is subsequently divided

• 45% into a short-term incentive (STI) component, which becomes payable immediately upon adop- tion of the annual financial statements by the Supervisory Board, and
• 55% into a long-term incentive (LTI) component, which is only paid out after three further financial

years, provided that a minimum target achievement of 30% is reached in each of the financial years up to the regular payment of the LTI. Other- wise, the claim for payment lapses.

The following are used as a starting point for the development comparison of the corresponding financial year:

• the volume-weighted average price of the DKR share in the month of September,
• the EPRA NTA per share as of September 30,
• FFO per share in the reporting period.

The latter two figures are based on the IFRS financial statements for the underlying financial year. The values determined are then set as a percentage in

relation to the respective prior-year figures determined using the same procedure.

The Supervisory Board reserves the right to pay out the LTI in the form of DKR shares in the event that an employee share program is introduced. However, there are currently no plans to introduce such a program.

Compensation earned by the Management Board in nancial year 2022/2023

The compensation of the Management Board earned in the past financial year amounts to TEUR 371.0 (2021/2022: TEUR 434.3).

Individual Management Board compensation was as follows based on target achievement in financial year 2022/2023:

Total

0

0

1.5

1.5

189.0

45.6

1.5

1.5

189.0

45.6

Total compensation

53.6

71.4

162.0

162.0

349.5

184.6

155.4

155.4

342.9

178.3

Compensation granted and owed to the Management Board in nancial year 2022/2023

In accordance with the statutory provisions of § 162

1. sentence 1 AktG, the compensation granted and owed for the financial year must be disclosed. As already described above, DKR has opted for an inter- pretation in accordance with the inflow principle.

Accordingly, following the aforementioned definition of "granted" and "owed," the following compensation components result for the financial year 2022/2023:

Total

0.0

0.0

57.4

105.1

57.4

105.1

Total compensation

53.6

71.4

217.9

244.1

211.3

237.8

STI

For the presentation of the performance criteria for the variable compensation components received in financial year 2022/2023, the key figures for financial year 2021/2022 apply to the STI. For full achievement of the performance criteria in the financial year 2021/2022, an increase in FFO per share from

EUR 1.17 to EUR 1.41 (actually achieved: EUR 1.19 per share/target achievement 7.12%), an increase in the share price after dividend adjustment from EUR 13.85 to EUR 16.62 (actually achieved: EUR 9.3/ target achievement 0.0%) and an increase in the EPRA NAV per share after dividend adjustment from EUR 10.10 to EUR 11.52 (actually achieved:

EUR 11.51 per share/target achievement 99.56%) was required. The overall target achievement was thus 35.6% across all targets.

LTI

In financial year 2022/2023, the LTI for financial year 2019/2020 was paid out after a 2-year vesting period. In the financial years 2020/2021 and 2021/2022, the minimum overall target achievement rate of 30% was met, fulfilling the requirement for payment of the LTI calculated for 2019/2020. The LTI from the 2019/2020 financial year is based on overfulfillment only in the area of the EPRA NAV per share key figure, which is why 20% of the maximum remuneration

(cap) was reached for the variable part of the Management Board remuneration.

The relevant Compensation System was therefore complied with in fiscal year 2022/2023. No variable compensation components were clawed back.

commercial employees working at DKR's headquarters (excluding temporary interns) and the janitors or property managers working at various property locations.

For the development of Management Board compen- sation, the amounts received (granted) in the finan- cial year have been stated.

Comparative presentation pursuant to § 162

(1) Sentence 2 No. 2 AktG

For the purpose of comparing the compensation of the Management Board and the Supervisory Board with the average compensation of employees, two comparison groups were formed: All permanent

EPRA NAV per share was calculated for the last time for financial year 2020/2021 for the purposes of Management Board compensation. EPRA NAV per share was replaced by EPRA NTA per share in financial year 2021/2022.

Contribution of compensation to the promotion of the business strategy and the long-term development of the Company

Fixed basic compensation and respective fringe bene- fits are in line with labor market practices and are thus in many cases a condition for concluding new and renewing existing Management Board contracts. The members of the Management Board thus receive a basic income that appropriately reflects the duties and responsibilities associated with the respective position and prevents inappropriate risks from being taken. The basic income as a non-performance-related compensation component is also intended to ensure that the Management Board members devote their full efforts to the Company even if the targets agreed as part of the variable compensation cannot be achieved or can only be achieved to an insignificant extent.

The variable compensation components are intended to provide incentives for the long-term and sustainable development of DKR. The aim is to create long- term corporate value along the entire value chain of the Company. The variable compensation helps to further harmonize the interests of shareholders with those of the Management Board. Furthermore, it contributes to the long-term commitment of the members of the Management Board.

The long-term portions of the variable Management Board compensation exceed the short-term portions

and reflect the Company's performance over a short- term period based on the respective financial year and a long-termthree-year period.

Maximum compensation

The gross annual fixed salary in the 2022/2023 finan- cial year for the members of the Management Board was TEUR 142.5 p.a. An exception to this was the previous Chairman of the Management Board, who received a pro rata fixed salary of TEUR 53.6 until

13 July 2023 and to whom no variable compensation components were paid.

A cap on fringe benefits (such as the use of a company car) has not yet been resolved. However, the fringe benefits claimed by the Management Board members are within the usual range.

Under the STI, the target compensation per Management Board member is TEUR 56.3 and the maximum compensation (cap) TEUR 84.4. Under the LTI, the target compensation per Management Board member is TEUR 68.8 and the maximum compensation is TEUR 103.1.

The maximum compensation (excluding fringe bene- fits) for the members of the Management Board - with the exception of the Chairman of the Management Board - is therefore as follows:

In EUR Mio.

Fixed compensation

STI

LTI

2022/2023

142.5

84.4

103.1

2021/2022

120.0

84.4

103.1

Total

330.0

307.5

Audit opinion

We have formally audited the Compensation Report of Deutsche Konsum REIT-AG for the financial year from 1 October 2022 to 30 September 2023 to determine whether the disclosures pursuant to § 162 (1) and (2) of the German Stock Corporation Act (AktG) have been made in the Compensation Report. In accordance with § 162 (3) of the German Stock Corporation Act (AktG), we have not audited the content of the Compensation Report.

In our opinion, the accompanying Compensation Report includes, in all material respects, the disclosures required by § 162 (1) and (2) of the German Stock Corporation Act (AktG). Our audit opinion does not cover the content of the Compensation Report.

Basis for the audit opinion

We conducted our audit of the Compensation Report in accordance with § 162 (3) of the German Stock Corporation Act (AktG) and in compliance with the

IDW Auditing Standard: The Audit of the Compensation

Report in accordance with § 162 (3) AktG (IDW PS 870 (09.2022)). Our responsibility under that provision and standard is further described in section "Respon- sibility of the auditor" of our report. As an auditing practice, we have applied the requirements of the

IDW Quality Assurance Standard: Requirements for

Quality Assurance in the Auditing Practice (IDW QMS 1

(09.2022)). We have complied with the professional duties pursuant to the Auditors' Code and the Professional Statutes for Auditors/Sworn Auditors including the requirements for independence.