THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. IF IN DOUBT, PLEASE SEEK PROFESSIONAL ADVICE.

If you are in any doubt as to any aspect of this Circular or as to the action to be taken, you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all of your units in Prosperity REIT, you should at once hand this Circular, together with the accompanying form of proxy, to the purchaser or transferee or to the bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

The Securities and Futures Commission of Hong Kong, Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this Circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.

Prosperity Real Estate Investment Trust

(a Hong Kong collective investment scheme authorised under section 104

of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong))

(Stock Code: 808)

Managed by

ARA Asset Management (Prosperity) Limited

CIRCULAR TO UNITHOLDERS IN RELATION TO

(1) EXTENSION OF CONTINUING CONNECTED PARTY TRANSACTION WAIVER

AND PROPOSED NEW ANNUAL CAPS FOR

CERTAIN CONTINUING CONNECTED PARTY TRANSACTIONS;

(2) CONTINUAL SERVICE OF

RELEVANT INDEPENDENT NON-EXECUTIVE DIRECTORS;

(3)PROPOSED GRANT OF GENERAL MANDATE TO BUY BACK UNITS;

AND

(4)NOTICE OF ANNUAL GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee of

the REIT Manager, the Independent Unitholders and the Trustee

A letter to the Unitholders is set out on pages 7 to 24 of this Circular.

A notice convening the AGM to be held at 2 : 30 p.m. on Friday, 17 May 2019 at Exhibition Venue A on Level 7, Fortune Metropolis, 6 The Metropolis Drive, Hunghom, Kowloon, Hong Kong is set out on pages N-1 to N-4 of this Circular. Whether or not you are able to attend and vote at the AGM in person, please complete and return the accompanying form of proxy to the Unit Registrar of Prosperity REIT, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the AGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM or any adjournment thereof should you so wish.

10 April 2019

TABLE OF CONTENTS

Page

CORPORATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2

LETTERS TO UNITHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

1.

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

2.

2019 WAIVER EXTENSION AND NEW ANNUAL CAPS . . . . . . . . . . . . . .

8

3.

CONTINUAL SERVICE OF RELEVANT INDEPENDENT

NON-EXECUTIVE DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

17

4.PROPOSED GRANT OF GENERAL MANDATE TO

BUY BACK UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 18

5.

VOTING AT THE AGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 19

6.

RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 20

7.

RESPONSIBILITY STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 23

8.

ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. 24

LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . . . .

IBC-1

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER . . . . . . . . . . . . . . . .

IFA-1

APPENDIX I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

AI-1

APPENDIX II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

AII-1

APPENDIX III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

AIII-1

NOTICE OF ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

N-1

- i -

CORPORATE INFORMATION

Prosperity REIT

Prosperity Real Estate Investment Trust, a collective investment

scheme constituted as a unit trust and authorised under section

104 of the SFO subject to applicable conditions from time to

time.

REIT Manager

ARA Asset Management (Prosperity) Limited

(in its capacity as manager of Prosperity REIT)

Unit 901, Level 9, Fortune Metropolis

6 The Metropolis Drive

Hunghom, Kowloon

Hong Kong

Directors of the REIT

Non-executive Directors

Manager

Dr. Chiu Kwok Hung, Justin (Chairman)

Mr. Lim Hwee Chiang

Mr. Ma Lai Chee, Gerald

Executive Director

Ms. Wong Lai Hung

Independent Non-executive Directors

Dr. Lan Hong Tsung, David

Mrs. Sng Sow-Mei (alias Poon Sow Mei)

Mr. Wong Kwai Lam

Trustee

HSBC Institutional Trust Services (Asia) Limited

(in its capacity as trustee of Prosperity REIT)

1 Queen's Road Central

Hong Kong

Unit Registrar

Computershare Hong Kong Investor Services Limited

17M Floor, Hopewell Centre

183 Queen's Road East, Wanchai

Hong Kong

Legal Advisers to the

Baker & McKenzie

REIT Manager

14th Floor, One Taikoo Place

979 King's Road

Quarry Bay

Hong Kong

Independent Financial

Ballas Capital Limited

Adviser to the

Unit 1802, 18/F

Independent Board

1 Duddell Street, Central

Committee, the

Hong Kong

Independent

Unitholders and the

Trustee

- 1 -

DEFINITIONS

In this Circular, the following definitions apply throughout unless otherwise stated. Also, where terms are defined and used in only one section of this document, these defined terms are not included in the table below:

2016 EGM

The extraordinary general meeting of Unitholders held on 6 May

2016.

2016 Extended Waiver

The waiver granted by the SFC on 6 May 2016 as more fully

described in the circular dated 5 April 2016 issued by the REIT

Manager to the Unitholders.

2019 Extended Waiver

Has the meaning ascribed to it in section 2.3 of this Circular

headed ''Extension of the 2016 Extended Waiver''.

2019 Waiver Extension

Has the meaning ascribed to it in section 2.3 of this Circular

headed ''Extension of the 2016 Extended Waiver''.

AGM

The annual general meeting of Unitholders to be convened on

Friday, 17 May 2019 at 2 : 30 p.m. at Exhibition Venue A on

Level 7, Fortune Metropolis, 6 The Metropolis Drive, Hunghom,

Kowloon, Hong Kong.

AGM Notice

The notice included in this Circular in respect of the AGM to

consider and, if thought fit, approve the resolutions to be

proposed at the AGM.

Articles of Association

The articles of association of the REIT Manager.

Audit Committee

The audit committee of the REIT Manager.

Board

The board of directors of the REIT Manager.

Buy-back Mandate

The general mandate authorising the buy-back by Prosperity

REIT of up to 10% of the Units in issue at the date of passing the

Ordinary Resolution to approve the Buy-back Mandate on the

Hong Kong Stock Exchange, as more fully described in this

Circular.

CK Asset

CK Asset Holdings Limited (formerly known as Cheung Kong

Property Holdings Limited), a company incorporated in the

Cayman Islands with limited liability, whose shares are listed on

the Main Board of the Hong Kong Stock Exchange (Stock Code:

1113).

- 2 -

DEFINITIONS

CK Asset Connected

CK Asset and any person who is connected to CK Asset as

Persons Group

described in paragraphs 8.1(e), (f) or (g) of the REIT Code,

including: (i) any director, senior executive or officer of CK

Asset; (ii) any associate (as defined in the REIT Code) of CK

Asset or of any director, senior executive or officer of CK Asset;

and (iii) any controlling entity, holding company, subsidiary or

associated company (as defined in the REIT Code) of CK Asset.

CK Asset Connected

Has the meaning ascribed to it in section 2.3 of this Circular

Persons Group

headed ''Extension of the 2016 Extended Waiver''.

Leases/Licences

Compliance Manual

The compliance manual of the REIT Manager.

Connected Person

Has the meaning ascribed to it in the REIT Code.

Continuing Connected

The continuing connected party transactions between the

Party Transactions

Prosperity REIT Group on one part and the CK Asset

Connected Persons Group and/or the Manager Group on the

other part, the details of which are set out in this Circular.

Designated (Finance)

The designated (finance) committee of the REIT Manager.

Committee

Directors

The directors of the REIT Manager.

Disclosures Committee

The disclosures committee of the REIT Manager.

Existing Properties

The seven properties held by Prosperity REIT as at the Latest

Practicable Date, as described in the annual report of Prosperity

REIT for the year ended 31 December 2018.

Hong Kong

The Hong Kong Special Administrative Region of the People's

Republic of China.

Hong Kong Stock

The Stock Exchange of Hong Kong Limited.

Exchange

Independent Board

The independent committee of the Board established to advise

Committee

the Independent Unitholders on the 2019 Waiver Extension and

the New Annual Caps, comprising Dr. Lan Hong Tsung, David,

Mrs. Sng Sow-Mei (alias Poon Sow Mei) and Mr. Wong Kwai

Lam, being all three of the INEDs.

- 3 -

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