DIRECT MARKET REPORT GERMAN RETAIL - Europe Real Estate

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Economic context Germany Economic growth In 2006 the 2.8% growth in gross domestic product was higher than initially forecasted and considerably above the level of 2004 (1.2%) and 2005 (0.9%). In contrast to the previous years, the positive development in 2006 was not driven by exports but also through stronger domestic economic activity, accompanied by a rising demand for retail and commercial real estate. Exhibit 2 GDP growth for Germany 2001-2008e Source: Allianz Dresdner Economic Research, Statistisches Bundesamt, (*ifo-Institut) The following exhibit shows the year-on-year GDP growth in history as registered by the Federal Ministry of Economics and Deutsche Bundesbank. Exhibit 3 GDP growth for Germany 2002-2008e Source: Deutsche Bundesbank, Federal Ministry of Economics The assessment of the current economic situation in Germany worsened in last months. The corresponding indicator declined by 4.2 points to 70.2 points in October and another 0.2 points to 70.0 points in November. To put things in perspective: economic expectations for the euro zone decreased in November. The indicator dropped by 11.0 points and now stands at minus 30.0 points. The corresponding indicator for the current economic situation in the euro zone decreased by 2.7 points to 60.2 points. German retail update - 28/11/2007 6
The ZEW Indicator of Economic Sentiment 1 for Germany remained unchanged in October 2007 and stood like in September at minus 18.1 points. In November 2007 however it dived to minus 32.5 points! The historical average is 31.8 points. Due to the sub-prime crisis, which is definitely not over yet, financial market experts have re-adjusted their economic expectations, especially for the United States. Source: ZEW Exhibit 4 ZEW Indicator of Economic Sentiment The greatest risk factor for the development of the German economy in the following six months are the exports, which are expected to decrease owing to the strong Euro and the decreasing rate of growth of the US-economy. The current ongoing rise in oil prices (> USD 93/barrel) isn’t helping either. The cornerstone of the German economy is the labour market (exhibit 5). However, the current discussion on the Hartz-IV reforms on the German labour market might impair expectations. Exhibit 5 Unemployment rate development in time Source: Federal Labour Ministry 1 The ZEW Indicator of Economic Sentiment shows the balance between positive and negative expectations regarding future economic activity in Germany within a timeframe of six months. The horizontal line indicates the historical mean of the indicator. German retail update - 28/11/2007 7
Page 1 and 2: www.petercam.com Real Estate Novemb
Page 3 and 4: Executive Summary “The secret of
Page 5: Introduction Following the record r
Page 9 and 10: 2 Destatis 3 Federal Statistical Of
Page 11 and 12: Consumer Price Index Consumer price
Page 13 and 14: Exhibit 11 Division median net inco
Page 15 and 16: Exhibit 14 Population, purchase pow
Page 17 and 18: Exhibit 16 Life cycles of the vario
Page 19 and 20: Corporate tax rate to 15.8% In the
Page 21 and 22: (30%) 4 . The preference for hyperm
Page 23 and 24: Exhibit 20 Indexed space developmen
Page 25 and 26: Exhibit 23 Shopping centre pipeline
Page 27 and 28: y approximately 25 basis points by
Page 29 and 30: spread of DIY over shopping centres
Page 31 and 32: Rental levels Not only prime assets
Page 33 and 34: Exhibit 30 Retail yields and rents
Page 35 and 36: acquisition of new shopping centres
Page 37 and 38: Dawnay Day Treveria • Bloomberg t
Page 39 and 40: Exhibit 34 Portfolio overview BBI I
Page 41: Petercam Institutional Research and

DIRECT MARKET REPORT GERMAN RETAIL - Europe Real Estate

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