1 BERLIN III A/S Ekstraordinær generalforsamling 2. september 2011
2 Dagsorden 1. Meddelelse af bemyndigelse til bestyrelsen til efter bedste evne at forhandle og gennemføre et salg af selskabets ejendomsportefølje bestående af ca. 82 beboelsesejendomme og tilhørende grunde i Berlin-området ved salg af selskabets aktiebeholdning i Griffin Flats III Berlin Hamburg GmbH og Griffin Flats III Verwaltungsgeselschaft mbh på de bedst opnåelige betingelser og vilkår, dog minimum til en pris, der svarer til en kurs på 1,10 pr. aktie eksklusive selskabets egne aktier.
3 Indirekte salg af ejendomsporteføljen v/formand Henrik Frisch
4 Indkaldelsen har været kurspåvirkende Indskudt egenkapital t. DKK Kursudvikling fra d. 1/ / Egenkapital pr. 31/ t. DKK Aktiekurs pr.: 30/ / / Indre værdi pr. aktie pr.: 30/ / / Kurs/Indre værdi pr. aktie pr.: 30/ / / DKK 0,37 0,45 0,65 DKK 1,11 1,22 1,21 0,33 0,37 0,54 Markedsværdi pr. 30/ t.dkk
5 Overskrifter i august 2011
6 Oprindelig formål, strategi og udbyttepolitik Formål At investere direkte eller indirekte i ejendomme, herunder ved at eje aktier og/eller anparter i andre selskaber eller på anden vis. Strategi 10-årig investeringshorisont fra Udbyttepolitik Et fast årligt udbytte på 10% af den nominelle aktiekapital, svarende til 5% af den investerede kapital.
7 Historik og aktuel performance (mio. EUR) Prospekt (2006) LOI - CORESTATE Købspris ekskl omkost 197,8 191,0 Omkostninger ifm. 25,0 - anskaffelse og finans Multipel 13,3 12,8 Nettohusleje 14,9 14,9 Tomgang % 4,2 3,9
8 Porteføljens sammensætning Område Vurdering Ledighed Nettoleje Charlottenburg- Wilmersdorf Friederichshain- Kreuzberg 21,0 1,9% 1,3 17,4 4,6% 1,2 Lichtenberg 4,0 3,7% 0,3 Mitte 12,6 5,7% 1,1 Brandenburg 4,2 1,0% 0,3 Neukölln 20,5 1,6% 1,5 Pankow 32,7 4,6% 2,0 Reinickendorf 3,5 9,8% 0,2 Spandau 64,1 3,3% 5,6 Steglitz- Zehlendorf Tempelhof- Schöneberg Treptow- Köpenick 3,3 3,8% 0,2 12,8 2,8% 0,9 2,6 5,8% 0,2 Total 198,8 3,5% 14,9
9 Forventninger 2012/2016
10 Finansiel forecast 2016 Drift Indtægter 15,4 15,5 15,7 15,8 16,0 4,4 4,3 4,3 4,3 4,3 11,0 11,2 11,4 11,5 11,7 4,5 4,8 5,2 5,4 5,7 Likv. Netto likv. 0 0,4 0,7 0,8 1,1 Forventeligt ikke udbytte før 2016 God egenkapitaludvikling Værdi Omkostninger Resultat før renter Resultat før skat Likv. fra 4,5 4,8 5,2 5,4 5,7 driften Investeringer 2,2 2,0 2,0 2,0 1,9 Afdrag 2,3 2,4 2,5 2,6 2,7 Værdiudvikling Ejd Afdrag og netto likv. I alt i % af primo EQ 3,1 1,8 2,6 1,0 3,2 2,3 2,8 3,2 3,4 3,8 11% 8% 10% 7% 9%
11 LOI fra CORESTATE 8 ugers tilbud på køb fra 3. august Aktiehandel underliggende datterselskaber DKK 1,10 4 ugers eksklusivitet fra generalforsamlingens afholdelse Overtager prioritetsgælden inkl. negativ swap-værdi. Reduktion af den regnskabsmæssige egenkapital Balancen vil i al væsentlighed bestå af likvider >DKK 310 mio.
12 Præsentation af CORESTATE
13 CORESTATE Capital AG Presentation to the Extraordinary General Meeting Of Berlin III A/S Copenhagen 2 September, 2011 Strictly Confidential
14 Leading Platform and Track Record CORESTATE Capital: At a glance CORESTATE Capital AG Specialised real estate private equity investor focused on German residential property Since inception in 2006, invested c. 1.7 billion in German real estate market Senior management involved in 80 transactions of c. 17 billion over the last six years, all of which profitable Assets under Management ( AuM ) 1.5 billion assets under management 23,000 residential units 123,000 sqm net lettable commercial area 5 European offices (Zug, Frankfurt, Essen, London and Luxembourg) CORESTATE Capital Advisors industry leading asset management platform Acquisition, due diligence and operating platform based in Frankfurt and Essen Deep localized expertise focused on value maximization Special task force for restructuring operations and capital structures CORESTATE s investors CORESTATE is managing closed-ended funds and investment platforms for institutional investors Named investors include pension funds, life insurers and investment managers such as ING, Schroders, Aberdeen, CBRE, DTZ and Partners Group Berlin III EGM, 2 September
15 Transaction Summary Key facts for the Berlin III Portfolio The Berlin III portfolio contains 3,046 residential units located all over Berlin. After some serious under-performance in the past, the portfolio is now fully stabilized and has a minimal vacancy rate. The portfolio is widely diversified, but the two largest properties with approx. 33% of residential all units are located in the district of Spandau. According to the technical analysis provided by independent experts, the portfolio will require c. 14m of capex, repairs and maintenance and internal and external refurbishments over the next few years in order to stay in its current shape. CORESTATE s offer CORESTATE has offered to pay 186m for the 83 properties, and to assume the negative market value of the swap of c. 5m. Corestate will also assume any risk of the value of this swap further fluctuating. Together with an upfront emergency capital expenditure budget of 6.5m and related transaction costs, Corestate s AIC equates to 204m. This offer will be funded by the existing debt of c. 145m, and new equity of c. 55m. CORESTATE has been in contact with all financing banks and is comfortable that the existing loans can be assumed on acceptable terms. The final details of the transaction will be adjusted to reflect the exact composition of the portfolio (number of properties / flats, etc.) at the date of the sale taking legal effect. Berlin III EGM, 2 September
16 Berlin III Transaction Timeline Timeline to Closing of Transaction Process up to date CORESTATE has held in-depth negotiations with the Board of Berlin III A/S since early August 2011 The commercial due diligence has been essentially completed, including a detailed inspection of all 83 properties CORESTATE has reserved the equity needed, and has obtained initial approval from its Investment Committee Discussions with the existing financing providers have provided CORSTATE with the required comfort Following approval by the EGM of Berlin III A/S, the transaction will be closed as follows: CORESTATE will complete its thorough confirmatory due diligence process (legal and tax advice) Negotiation of the sales & purchase agreement with the board of Berlin IIII, and ancilliary documents Finalisaton of the loan transfers, and the extension of the Berlin Hyp loan, before signing of the acquisition Entering into legally binding acquisition documenation by the end of October 2011 Closing / operational take-over of the Berlin III portfolio in November 2011 Berlin III EGM, 2 September
17 Contacts CORESTATE Capital AG Baarerstrasse 135 CH-6300 Zug Switzerland CORESTATE Capital Advisors GmbH Neue Mainzer Straße Frankfurt am Main Germany CORESTATE Capital Advisors (UK) LLP 21 Bruton Street London W1J 6QD United Kingdom Berlin III EGM, 2 September
18 Disclaimer This document is personal to the recipient and has been issued by and is the sole responsibility of Corestate Capital AG, a company formed under the laws of Switzerland (the "Company"), and solely for use at a presentation to potential investors concerning the proposed transaction set out herein (the "Transaction"). This document does not constitute or form part of, and should not be construed as constituting or forming part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or securities in the Company or in any other entity, nor shall any part of this document nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision relating thereto, nor does it constitute a recommendation regarding the securities of the Company or of another entity, or of the Transaction. The information contained herein is for discussion purposes only and does not purport to contain all information that may be required to evaluate the Transaction and/or the Company and/or any other entity and/or the financial position of any of the foregoing. Some of the information in this document has not been legally verified. No reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness, accuracy or fairness. No representation or warranty, express or implied, is given by or on behalf of the Company, its directors, officers or employees or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability whatsoever is accepted by the Company, its members, directors, officers or employees nor any other person for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith. This document, its contents, any discussions at this meeting or otherwise made available (whether orally or in writing) in connection with the Transaction and/or Company, is being provided to you solely for information and is being given on the basis that the recipients keep confidential all such information. This document is confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose and it is intended for distribution in the United Kingdom only to: (i) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the Order ); or (ii) persons falling within Article 49(2)(a) to (d) of the Order or to those persons to whom it can otherwise lawfully be distributed (all such persons together being referred to as relevant persons ). This document must not be acted upon by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Any recipient of this document who is not a relevant person should return it immediately, not attend the presentation and take no other action. Neither this document nor any copy of it may be taken or transmitted into the United States of America, its territories or possessions or distributed, directly or indirectly, in the United States of America, its territories or possessions. This document does not constitute an offer to sell or the solicitation of an offer to buy the securities discussed herein. Neither this document nor any copy of it may be taken, transmitted or distributed into or in Australia, Canada or Japan or to Canadian persons or to any securities analyst or other person in any of those jurisdictions. Any failure to comply with these restrictions may constitute a violation of United States, Australian, Canadian or Japanese securities law. The distribution of this document in other jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. The securities mentioned herein have not been, and will not be, registered under the US Securities Act of 1933, as amended (the Securities Act ), under the applicable securities laws of any state of the United States or under the applicable securities laws of Canada, Australia or Japan, and may not be offered or sold in the United States (as such terms are defined in Regulation S under the Securities Act) unless they are registered under the Securities Act or pursuant to an exemption from, or in a transaction not subject to the registration requirements of the Securities Act and, subject to certain exceptions, may not be offered or sold within Canada, Australia or Japan or to any national, resident or citizen of Canada, Australia or Japan. No public offer of securities in the Company or any other entity is being made in the United States, Canada, Australia or Japan. This document is an advertisement and not a prospectus and investors should not subscribe for or purchase any shares or securities referred to in this document except on the basis of information in the [investment memorandum] issued by the Company in due course in connection with the Transaction (the [Investment Memorandum] ). Copies of the [Investment Memorandum] will be available from the Company, and include a description of risk factors relevant to an investment in the Company and the Transaction. The information and opinions expressed in this document are provided as of the date of this document. Certain statements, beliefs and opinions in this document, including those related to the Transaction, are forward looking, which reflect the Company s or, as appropriate, the Company s directors current expectations and projections about future events. By their nature, forward looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward looking statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any forward looking statements, whether as a result of new information, future events or other wise. You should not place undue reliance on forward looking statements, which speak only as of the date of this document. No statement in this presentation is intended to be nor may it be construed to be a profit forecast. No person, who is privy to unpublished information concerning an offer, should deal or encourage dealing in the securities of the target or any other company involved in a potential transaction (or any derivates or spread bets referenced to such securities) at any time where there is a reason to suppose a material transaction is contemplated or when it is known or believed that a potential transaction party has decided not to proceed with a deal. Any such dealing may constitute a criminal offence, breach of the Code and/or market abuse under UK law. By attending the presentation to which this document relates or by accepting a copy of this document you agree to be bound by the foregoing limitations and, in particular, you will be taken to have represented, warranted and undertaken that: (i) you are a relevant person (as defined above); (ii) you have read and agree to comply with the contents of this notice; and (iii) you will not at any time have any discussion, correspondence or contact concerning the information in this document or the Transaction with the Target, any of the directors or employees of the Company or the Target, their subsidiaries, nor with any of their suppliers, customers, sub contractors or any governmental or regulatory body without the prior written consent of the Company. Berlin III EGM, 2 September
19 Next steps Såfremt forslaget vedtages, vil processen fremadrettet være: Færdiggørelse af due diligence 4 uger Kontraktforhandling Udarbejdelse af alternativ porteføljestrategi, forretningsplan og udbyttepolitik Tilbagekøbsprogram Closing 2. ekstraordinær generalforsamling Præsentation af den alternative porteføljestrategi Præcisering af tilbagekøbsprogrammet
20 Investeringsstrategi post CORESTATE Indkøbe, driftsoptimere og videresælge investeringsejendomme direkte eller indirekte via aktier ejendomsselskaber med henblik på at skabe en årlig forretning til aktionærerne på 10 til 15% Porteføljer ejet eller pansat hos kreditinstitutter Debitorskifte Tilført likvider Kreditinstituttet får nedbragt balancen Indkøb Kurs/indreværdi i eksisterende børsnoterede ejendomsselskaber Driftsoptimering Videresalg Ejendomme og gældsposter er optaget til markedsværdi Børsmarkedet indregner en discount
21 Investeringsstrategi post CORESTATE Eksempler på noterede ejendomsselskaber med væsentlige kurs/indre værdi forhold. Selskab 1 Selskab 2 Selskab 3 Selskab 4 Børskurs 53 0, /600 0 Aktiekap.m DKK Aktieværdi, børskurs Egenkapital, mdkk Kurs/Indre værdi Investerings ejendomme ,6 0,7 0,7 0, En 30% aktieandel kan teoretisk erhverves for 210 mdkk i et selskab med ejendomme for mdkk
22 Overvejelser Mulighed for bedre pris? Refinansieringsrisiko? Risiko for tvangssalg af Spandau? Realisere mere værdi ved nuværende forretningsplan? Andre exit-strategier? Kurs/Indreværdi? Øvrige tiltag ekskl. udstykning? FOR Kontant afregning min. gns kurs DKK 1,10 og/eller deltage i en fremtidig investering i nye porteføljer IMOD Deltage i en fremtidig værdiskabelse i eksisterende portefølje, herunder evt. alternativ exit Potentialet er realiseret ved lav tomgang etc.? Giver nye porteføljer et mere attraktivt afkast?
24 Drøftelser uden for dagsordenen
25 BERLIN III A/S TAK FOR I DAG