2016 - Wereldhave Belgium

2016Annual

financial report

This annual financial report is a registration document in the sense of art. 28 of the Law of 16 June 2006 on the public offering of investment instruments and the admission of investment instruments to trade on a regulated market.

The Dutch version was approved by the FSMA, according to Art. 23 of the aforementioned Law, on 7 March 2017. This approval does not imply any opinion of the FSMA on the state of the Company. Wereldhave Belgium has its annual financial report drawn up in Dutch. Wereldhave Belgium has made a French and English translation of this annual financial report. Both the Dutch, French and English versions of this annual financial report are legally binding. Wereldhave Belgium, represented by its Management Company is responsible for the translation and the conformity of the Dutch, French and English language versions. However, in case of discrepancies between the language versions, the Dutch version always has priority.

The Dutch version of the registration document approved by the FSMA, according to Art. 23 of the aforementioned law, on 7 March 2017, and the French and English translation are available on the website of the Company (www.wereldhavebelgium.com).

WERELDHAVE BELGIUM ANNUAL REPORT 2016 1

CONTENTS

1 RISK FACTORS 3Market risks 5Operational risks 9Financial risks 14Regulatory risks 16Risk management 18

2 CONSOLIDATED KEY INFORMATION 19Key information 21Consolidated key figures over the past 5 years 21

3 MESSAGE TO THE SHAREHOLDERS 23Focus on leasing and operations 25

4 CONSOLIDATED ANNUAL REPORT 27Profile 29Structure 29Valuation of real estate 29Financial position 29Corporate governance statement 30Consolidated annual report 76

5 MANAGEMENT REPORT 94Mission and strategy 95Important developments 97Financial results 99Events having occurred afterthe end of the financial year 101Research and development 101Allocation of the profit 102Prospects 103

6 EPRA 104Epra performance measures 105Table 1: epra earnings 106Table 2 en 3: epra nav en epra nnnav 107Table 4: epra net initialyield (niy) and ‘topped-up’ niy 107Table 5: epra vacancy rate 108Table 6: epra cost ratios 108

7 REAL ESTATE REPORT 109The belgian real estate market 111Summary and overviewof the real estate portfolio 112Description of the real estate portfolio 122Real estate experts’ report 130

8 STOCK EXCHANGE& WERELDHAVE BELGIUM 133

Dividend and number of shares 135Other information 137Financial calendar for 2017 137Stock exchange data 138

9 FINANCIAL REPORT 141Consolidated statement of financial position 144Consolidated profit and loss account 146Statement of comprehensive income 148Consolidated cash flow statement 149Consolidated statementof movements in equity 150Notes 154Auditor’s report 190Statutory statement 192

WERELDHAVE BELGIUM ANNUAL REPORT 20162

CONTENTS

10 GENERAL INFORMATION 202Identification and statutory provisions 203Person responsible forthe content of the registration 215Statutory auditor 215Real estate experts 215Property managers 217Internal auditor 217Financial service provider: bnp paribas fortis 218External legal advisers 218Information related to the annualfinancial report 2014 and 2015 218

11 GLOSSARY AND ALTERNATIVEPERFORMANCE STANDARDS 219

Glossary 221


1


RISKFACTORS

1


The Company distinguishes between market,operational, financial and regulatory risks. Certain risksattached to the activities of the Company are amplifiedby permanent changes on the real estate markets andthe economic climate.

Below is a description of the most important risks, thespecific measures to manage the risks concerned, andthe possible impact of the risks on the company’sresults and capital.

MARKET RISKS

RISK DESCRIPTION POSSIBLE IMPACT LIMITING MEASURES

Economic climate

Slowdown of the economicclimate or recession

1) Decline of rental income in the event of re-renting or requests for rental reductions.

2) Higher bankruptcy risk of the tenant.

3) Decline in the fair value of the real estateinvestment portfolio and consequent declineof the net value of the share and increase inthe debt ratio.

4) Probability of the realisation of the risksdescribed below as a direct or indirect resultof the economic climate.

5) Increase in vacancy.

Geographic spread of the real estate portfolioacross Belgium (See overview of the realestate portfolio p114-116). (1-2-3-4-5)

Sector-based diversification of the tenantportfolio (see branch mix p118). (1-2-3-4-5)

Active asset management. (1-2-3-4-5)

Accumulation and application of marketknowledge. (1-2-3-4-5)

The average duration of contractual rentalagreements up to the first severancepossibility is 3.2 years, and up to the end ofthe rental agreement 6.4 years. (1-2-3-4-5)

Rental market shoppingcentres

Reorientation institutionalinvestors

1) Higher bankruptcy risk of the tenant.

2) Possible increase in the number of doubtfuldebtors resulting in a decrease in collectionfrequency.

3) Increase in vacancy due to not findingpotential tenants at the market price.

Quality tenants, such as large national andinternational retailers, with a lower bankruptcyrisk. (1-2-3)

Active asset management through, amongstothers, direct contact with the tenants. (1-2-3)

Strict monitoring of the collection policy. (2)

Application of standard rental conditions suchas the advance payment of rent and theprovision of a bank guarantee (equivalent to3/6 months of rent). (1-2)

Stimulation of lease payments by direct debit.(1-2)

The numbering of ‘limiting measures’ refers to the numbering in the ‘possible impact’ column.

1RISK FACTORS



Decline in tenant solvency 1) Possible increase in the number of baddebts resulting in a decline in collectionfrequency.

2) Increase in vacancy due to not findingpotential tenants at the market price.

3) Potential decrease of the rental income.

Give preference to quality tenants. (1-3)

Screening of tenant solvency via the Graydondatabase. (1-3)

Active asset management through, amongstothers, direct contact with the tenants. (1-2)

Use of standard rental conditions such as theadvance payment of the rent and theprovision of a bank guarantee. (1-2)

Deflation risk 1) Postponement/cancellation of purchases ofconsumer goods (expected price falls) leadingto pressure on the tenant turnover.

2) Possible decline of rental income due tonegative indexation.

Quality and professional tenants with a lowerbankruptcy risk. (2)

Insofar as possible, state in the rentalagreement that the rental indexation cannotbe negative. (1-2)

Inflation risk 1) Increase in the financing cost due to anincrease in interest rates.

2) Increasing discrepancy between thecollected rental income and the market rent.

Possible hedging against these fluctuationsthrough financial derivatives (see note p177).(1-2)

Standard provision of indexation clauses inthe leases. (1-2)

Volatility of interest rates

Strong fluctuations in theshort and/or long term rateson international markets

1) Increase in the financial costs.

2) Fluctuations in the value of financialinstruments.

3) As a result of the above, a possible declineof the Net Asset Value and a higher debt ratio.

4) Potential decrease of the distributableresult.

Diversification of the various capital sources.(1-2-3)

Sufficient number of financial partners andprior examination and comparison of thefinancial ratings of credit institutions andsetting high standards for them. (1-2-3)

Hedge against these interest rate fluctuationsthrough financial derivatives. (1-2-3)

The debt ratio is limited to < 33% (as a resultof the deviation granted by the FSMA), andconsequently the impact of any fluctuations islimited. (1)

Debts at fixed rate (24.1 %) respectivelyvariabel rate (75.9%) (1-2-3-4)

1 RISK FACTORS



Financial markets

Volatility and uncertainty onthe international financialmarkets

1) Limited possibilities for raising new capitalin the form of equity or borrowed capital.

2) Increase in debt ratio and limitation ofgrowth opportunities.

3) Volatility of the share price.

Developing of solid long-term relations withinvestors and credit institutions so thatdialogue can take place on a regular basis. (1-2-3)

Wereldhave (International) NV is a reliable,solid and long-term shareholder. (1-2-3)

Systematic and consistent communication onthe financial outlook for all stakeholdersconcerned. (1-2-3)

Application and observance of the RREClegislation for the purpose of protecting theshareholders. (1-2-3)

Sound capital ratios. (1-2-3)

Aim for the preservation of sufficientavailability margins on confirmed lines ofcredit. (1-2-3)

Terrorism threat 1) Decline in visitors.

2) Decline in tenant turnover.

3) (Partial) destruction of building andconsequently possible decline in rentalincome.

High quality security (ICT, security services,etc). (1-2)

Cooperation with public services (police, etc).(1-2)

Insurance against terrorism and loss of rentalincome. (3)

Geo political situation

National/internationalpolitical instability

1) Increase in financing costs due to anincrease in the interest rates and possibledecline of the fair value of the real estateinvestment portfolio.

2) Decrease in the number of investmentsources and an increased risk of otherfinancial risks becoming effective.

3) Limited access to capital markets.

Focus on the retail real estate market ofpolitically stable and secure countries. (1-2-3)

The debt ratio is limited to < 33% (as a resultof the departure granted by the FSMA), andconsequently the impact of any fluctuations islimited. (1-2-3)

Sound balance sheet ratios. (1-2-3)

1RISK FACTORS



Change of value of the realestate portfolio

Value growth of the portfolio

1) Change in the balance sheet ratios.

2) Change in the net value of the share.

Proactive asset management under ownmanagement. (1-2)

Active investment management. (1-2)

An investment strategy aimed at quality, retailreal estate of standing. (1-2)

Active sustainability policy (measures toimprove energy performance, certification ofbuildings, separation of waste flows, etc). (1-2)

Liquidity risk of the share 1) Investors who do not invest in sharesbecause of liquidity.

2) Restrictions on the purchase and sale oflarge blocks of shares.

Transparent communication (1-2)

Financial services by BNP Paribas Fortis (2)

1 RISK FACTORS


OPERATIONAL RISKS


Strategy

Investment/policy choices

1) Not achieving expected returns.

2) Decline in the revenue stream as well as itsstability.

3) Readjustment of the company’s risk profile.

4) Decrease in occupancy because the realestate portfolio is not in line with marketdemand.

Clear long-term investment strategy andconsistent management of the capitalstructure that is regularly evaluated by theManagement Company. (1-2-3-4)

External valuation by an independent realestate expert prior to purchase. (1-2-3-4)

Formal approval procedure relating toinvestments by Executive Management andthe Management Company, and also anexperienced management team. (1-2-3-4)

Legal, fiscal and environmental-technical duediligence when purchasing real estate. (1-2-3-4)

Stipulation of rental guarantees by the realestate vendor. (1-2-3-4)

Permanent monitoring via an ICT applicationproject module. (1-2-3-4)

Permanent monitoring of the tenant file:financial, turnover, rental pressure, etc. (1-2-3-4)

Development pipeline

Solvency contractors, permits,budgeting etc.

1) Uncertainty about future income andoccupancy resulting in not achieving thetarget return.

2) Permits are not granted or incur delays.

3) Changes in the economic climate duringthe construction phase.

4) Material overrun of the budgets and costs.

Development pipeline limited to 10% of thereal estate portfolio. (1-2-3-4)

Prior analytical quantification/feasibility studyand monitoring by a team specialised inproject developments. (1-2-3-4)

1RISK FACTORS



Age and quality of buildings

Technical aging process

1) Rising maintenance costs.

2) Decrease in occupancy.

3) Reduced attractiveness for tenants resultingin a reduction of rental income.

Draw up a five-year budget every year forstructural maintenance and renovation. (1-2-3)

Portfolio rotation in order to keep theportfolio up to date (technical, location, etc.).(1-2-3)

Multi-year forecast relating to themaintenance of existing premises. (1-2-3)

Strict internal coordination by managementand monitoring with the real estate managers.(1-2-3)

Vacancy

Scenarios of vacant property,such as failures, relocations,shrinkage, etc.

1) Decrease in the occupancy.

2) Decrease in the fair value of the real estate,and as a result also the Net Asset Value.

3) Possible downward adjustment of the ERV.

4) Unforeseen costs or increase in costs thatare normally passed on (e.g. common chargesfor which the owner is liable).

Active management of the real estateportfolio in cooperation with the tenants andstakeholders to keep the value per propertyup to standard. (1-2-3-4)

Make use of the scale of operations in order tobe able to realise global deals on differentshopping centres. (1-2-3-4)

Temporary occupation in the form of pop-ups,marketing actions or other forms ofoccupation. (4)

Active cooperation with towns and brokers toreduce vacant properties as much as possible.(4)

Spread of the real estate portfolio as providedin the RREC legislation** to limit theconsequences of vacancy. The occupancy rateby 31 December 2016 was 95.8%.(1-2-3)

1 RISK FACTORS



Destruction of real estate

Demolition building by fire,accident, terrorism, etc.

1) Decrease in fair value of assets.

2) Loss or reduction of rental income or rentalturnover.

3) Unusability of the building.

The real estate investment portfolio is insuredat reconstruction value in accordance with theABEX index and insurance against a rental lossof a maximum of 36 months. The insuredreconstruction value of the portfolio wasinsured for an amount of € 538.6 million asper December 2016, i.e. 68.7 % of the fairvalue. The insurance premium is € 169,669. (1-2-3)

Active management of the real estateportfolio in cooperation with the tenants andstakeholders to commercially restore the realestate within a period of < 36 months. (1-2-3)

Termination of rentalagreement

Early termination or non-extension of a rentalagreement

1) Risk of vacancy as a result of a decline inoccupancy.

2) Decrease in rental income.

3) Unforeseen costs or increase in costs thatare normally passed on.

Fall back on rental securities/rentalguarantees if necessary. (1-2-3)

Conduct commercial negotiations with thetenant to increase the attractiveness of a deal.(1-2-3)

Sell-off of contractual rights. (1-2-3)

Concentration risk• tenants• property

1) Material downturn of rental income in theevent of departure, bankruptcy or decline inthe collection from a tenant.

2) Material decrease in the fair value of theproperty.

Diversification of income generated pertenant with observance of the legal provisionsin this respect (< 20%). The largest tenant(DKV) of the Company represents 5.4% of thetotal rental income. (1-2)

Spread of the real estate portfolio as providedby the RREC legislation** to limit the effects ofvacancy. (1-2)

1RISK FACTORS


OMSCHRIJVING RISICO MOGELIJKE IMPACT BEPERKENDE MAATREGELEN

Debtor risk 1) Non-extension or early break of the rentalagreement.

2) Decline in solvency or bankruptcy risk.

3) Tenant concentration.

4) E-commerce.

5) Concentration of real estate investments inone whole.

Short communication line with tenants. (1-2-3)

Internal leasing asset management team. (1-2-3)

Monitoring of the financial health of tenants(screening, turnover, financials, and rentalpressure). (1-2-3)

Aim for a high experience factor of theshopping centre, foster customer attachment,active role in the local community. (4)

Stringent collection procedure. Using anonline application, monthly supervision ofoutstanding claims and assessment of theadequacy of the provision for bad debts. Theprovision for doubtful debts as at 31December 2016 amounts € 53k (1-2-4)

Spread of the tenant portfolio – see branchmix p122. (1-2-3-4-5)

Limit concentration of important tenants. Thetop 10 most important tenants < 30%. (2-3-5)

Shopping centres provide a wider experienceaspect and other services than just shopping.(1-2-3-4-5)

1 RISK FACTORS



Turnover of key personnel 1) Negative effect on the existing businessrelations.

2) Loss of decisiveness and efficiency in themanagement decision-making process.

3) Loss of know-how.

Active monitoring of the workload. (2-3)

Clear and consistent procedures to guaranteecontinuity. (1-2-3)

Stimulate teamwork in order to avoid a singleindividual being solely responsible for aconcentration of important strategic tasks. (1)

Market-compliant remuneration of staff. (1-2-3)

Interruption of the continuityin Risk and ComplianceManagement due to forcemajeure

1) Temporary probability increase in theoccurrence of risks.

Provide internal training to instill the principlesof Compliance and Risk Management amongemployees in order to support its continuity.(1)

An experienced management team andinternal supervision by the ManagementCompany. (1)

External service providers donot correctly observe theservice contract

1) Possible negative effect on the income andcost flow, efficiency of the organisation, andgeneral reputation of the company.

Supervision of the activities of importantsuppliers and service providers on the basis ofclear KPIs*, with a results agreement wherepossible. (1)

Option of terminating the service contract inthe event of serious misconduct or fraud. (1)

Risk related to IT 1) Possible negative effect on the functioningof the organisation.

2) Possible destruction of operational andstrategic data.

Daily backups so that loss of data is limited intime .(1-2)

See point 5 Risk Management p18 (1-2)

(*) Key performance indicators(**) On 23 December 2016 the FSMA granted a renewed dispensation from the ban on investing more than 20% ofthe assets in one real estate stock. (See Real Estate Report – Summary and overview of the real estate portfolio).

1RISK FACTORS


FINANCIAL RISKS


Counterparty risk

Insolvency / credit risk withfinancial partners

1) Loss of deposits.

2) Higher or unforeseen financial costs.

3) Cancellation or termination of existing linesof credit or Interest Rate Swaps and thus apossible limitation of the growth potential.

4) General negative impact on the income.

Strict financing policy with balanced spreadregarding maturity, banks and product limitedto the Eurozone. (1-2-3-4)

Sound balance sheet ratios. The debt ratio islimited to < 33% (as a result of the departuregranted by the FSMA) and consequently theimpact of any fluctuations is limited. (1-2-3-4)

Stable shareholder structure (Wereldhave NVand Wereldhave International NV own 69.58%of the shares). (1-2-3-4)

20-30% unutilised margin of committed linesof credit. (1-2-3-4)

Cash flow and solvency risk 1) Inability to repay interest and capital.

2) Impossibility to realise growth.

3) Forced sale of real estate with possibleimpact on the sales price.

4) Unforeseen increase in the debt ratio.

Loans are of the bullet type with clear view ofthe due dates. (1)

20-30% unutilised margin of committed linesof credit. (1)

Strict monitoring with Executive Managementand Management Company concerning theimpact of possible interest rates changes. (1)

Protection against a rise in interest rates bymaking use of hedging instruments. (1-2-3)

Valuation of the real estate portfolio on aquarterly basis by independent real estateexperts. (1-2-3-4)

1 RISK FACTORS



Interest rate development 1) Increase in the weighted average cost ofcapital.

2) Impact on the profitability of the company.

20-30% unutilised margin of committed linesof credit. (1)

Strict monitoring with Executive Managementand Management Company concerning theimpact of possible interest rates changes. (1-2)

Protection against a rise in interest rates bymaking use of hedging instruments. (1-2)

Dividend risk 1) Volatility of share price.

2) General decline in confidence in the shareor the company.

The development of solid long-term relationswith investors and financial institutions suchthat dialogue can take place on a regularbasis. (1-2)

At least 80% of the corrected positive netresult, less the net decline of debt in thecourse of the financial year, must be paid outas dividend (See note 31 – art 617 CompanyCode p186). (1-2)

Bank covenant risk

Non-compliance with therequirement to meet certainfinancial parameters underthe credit agreements.

1) Cancellation, renegotiation, termination orearly payability of the financing agreementsby the financial institution upon the non-observance of the imposed ratios.

Prudent financial policy with constantmonitoring to satisfy financial parameters. (1)

Regular monitoring of the development of thedebt ratio and prior analysis of the impact ofevery intended investment operation on thedebt ratio. (1)

Risk of changes in fair valueof derivative instruments thatare intended to hedge theinterest rate risk

1) Counterparty risk to partners who havebeen concluded financial derivatives.

2) Complexity and volatility of the fair value ofthe hedging instruments and, consequently,of the net value of the share in accordancewith IFRS.

Cooperation with reputed internationalinstitutions gerupeteerde. (1)

All the derivatives are retained only forhedging purposes. No speculativeinstruments are held. (2)

Fluctuations in the fair value of hedginginstruments represent an unrealized non-cashitem (if the products are held to maturity andnot settled prematurely) and are presentedseparately in the statement of comprehensiveincome to increase readability. (2)

1RISK FACTORS


REGULATORY RISKS


Change in internationalaccounting rules andreporting standards IFRS

1) Impact on reporting, capital requirements,use of derivatives and the organisation of thecompany.

2) Direct or indirect impact on the real estatevaluation as well as on the operationalactivities.

Permanent evaluation of the changes relatingto legal standards. (1-2-3)

Collect advice from external specialisedservice providers. (1-2-3)

An experienced management team andsupervision by the Management Company inorder to observe the legislation and to alignthe strategy with this. (1-2-3)

Legislative framework RREC(1)

Loss of company status

1) Change of status to an ordinary real estatecompany and loss of the advantage of thefavorable tax status of RREC.

2) Possible impact on the reporting, capitalrequirements, use of financial products, creditagreements and general operationalorganisation of the company.

3) Impact on transparency, returns and resultsachieved, and the possible valuation.

4) Penalties and/or intensified supervision bythe FSMA if the legal (financial) parametersare not satisfied.

5) Possible overrun of the limiting thresholdfor the free float > 30%.

Continuous evaluation and constant attentionby the Management Company. (1-2-3-4)

The dividend obligation and financing limitsare regularly calculated and determined. (1-2-3-4)

Regular dialogue with the FSMA as regulatorand supervisor of the Regulated Real EstateCompanies. (1-2-3-4)

An experienced management team andsupervision by the Management Company inorder to observe the legislation and to alignthe strategy with this. (1-2-3-4)

The Developer (Wereldhave (International)NV) strictly observes the regulatory legislationon the preservation of the RREC status and inparticular regarding the limits relating to thefree float. (1-4-5)

Referring to existing practices within the Tax Administration, in particular those mentioned in the Circular letterref. Ci.RH. 423/567.729 dd. 23.12.2014 emanating from the Finance Minister concerning the calculation of exittax which clarified, among other things, that the value of the assets in question, for calculating the basis of theexit tax (for tax purposes, the taxable amount for the exit tax calculation), is determined by deducting theregistration duties or the VAT that would be applied if the assets in question were sold, which is different (it islower) from the fair value of these assets as determined under IFRS-rules.

1)

1 RISK FACTORS



Change of general, urbanplanning and/orenvironmental legislation

1) Must comply with the legislation withdetrimental implications for the companyand/or its shareholders and stakeholders(withholding tax, municipal taxes, andenvironmental taxes).

2) Not-prepared or incorrect assessment ofthe impact of the practical application of newlegislation.

3) Impact on the purchase and sales prices ofreal estate.

4) Decrease in the return and consequentlythe attractiveness of the share.

5) Decline in the fair value of the real estateportfolio.

Remain constantly informed of new legislationby monitoring seminars, assistance byspecialists in this respect and self-study. (1-2-3-4-5)

An experienced management team andsupervision by the Management Company inorder to observe the legislation, and to alignthe strategy with this and evaluate itdepending on the specific impact. (1-2-3-4-5)

1RISK FACTORS


RISK MANAGEMENTThe Management Company is responsible for theplanning, implementation and operation of the internalrisk management and control systems geared to thebusiness activities of the Company. The ManagementCompany is aware that no risk management andcontrol system can provide an absolute guarantee formeeting the company objectives and preventingsignificant errors, losses, fraud or violation of laws orregulations.

The instruments for internal control and riskmanagement are formed by the CorporateGovernance Charter, the administrative organisation,the investment strategy approved by the ManagementCompany each year, the Business Principles and theCode of Conduct.

The Company has a system of warnings in the event ofbreaches. The integrity-sensitive positions areitemised. Special procedures apply for the hiring ofemployees in such positions.

The Company has set up an appropriate administrativeorganisation for itself in which the internal control isembedded. The company processes are documentedin a database that is available online for all employees.This system not only guarantees the continuity of thecompany processes, but also records and shares theknowledge available in the company. Moreover, thecompany processes are developed as job descriptionsfor each position.

The Administrative Organisation/Internal Controlsystem is based upon an enforced division of rolesinsofar possible. This system also comprises anautomated information system, the access to which isbased on the job descriptions. Both contracting andpayments take place on the basis of the four eyesprinciple.

The Company applies strict procedures for the regularcompilation of quarterly and annual figures on thebasis of the established foundations.The internalmanagement reports are aimed at the directreporting of changes in the value of investments andthe profit per share. Furthermore, electronic dataprocessing is used in an automated integrated centralinformation system.

The Company aims to guarantee the reliability andcontinuity of its IT organisation and automated dataprocessing by employing a system of preventive andrepressive measures. This system is designed tosafeguard the integrity, exclusivity, availability andcontrollability of automated data processing andstorage. Daily backups are made of the data files.

1 RISK FACTORS


2


CONSOLIDATED KEYINFORMATION

2


KEY INFORMATION

2012 2013 2014 2015 2016

Share price 31/12 82.5 83.22 102.01 110 107.7

Share price/Net result from core activities 31/12 16.9 16.3 19.3 19.5 18.63

Market capitalisation 31/12 (mln) 520.4 525.00 643.5 763.3 747.3

Net asset value per share (conform IFRS) 76.21 77.83 78.99 81.76 86.41

Gross dividend 4.25 4.4 4.6 4.9 5.1

Dividend yield 31/12 (gross) 1) 5.15% 5.29% 4.51% 4.45% 4.74%

Consolidated debt ratio 2) 16.20% 20.60% 34.80% 27.50% 27.60%

Occupationcy rate 3) 93.70% 97%.00 94.10% 94.10% 95.80%

Pay-out ratio 87.27% 86.44% 86.95% 87.00% 88.24%

Free float 30.59% 30.6% 30.59% 30.42% 30.42%

Gross dividend divided by the share price on 31/12/2016.1)

See calculation table in note 30 of the consolidated financial report.2)

Sum of indexed rent from current leases divided by the sum of contractual rents and estimated rental value of vacancies.3)

CONSOLIDATED KEY FIGURES OVER THE PAST 5 YEARS(X € 1,000)

RESULTS 2012 2013 2014 2015 2016

Net rental income 33,170 35,831 38,932 47,409 49,733

Net result 36,465 34,752 38,855 49,391 66,241

Net result from core activities 1) 29,415 32,089 33,371 39,093 40,078

Net result from non-core activities 2) 7,050 2,663 5,484 10,298 26,163

(X € 1,000)

BALANCE SHEET 2012 2013 2014 2015 2016

Investment properties 3) 499,801 505,322 722,607 731,919 783,357

Lease incentives 1,178 1,652 1,689 1,563 1,152

Investment properties excl. development projects 500,979 506,974 724,296 733,482 784,509

Development projects 55,244 90,159 25,802 40,547 35,318

Shareholders’ equity 480,720 490,979 498,284 567,310 599,586

NUMBER OF SHARES 2012 2013 2014 2015 2016

6,308,198 6,308,198 6,308,198 6,939,017 6,939,017

2CONSOLIDATED KEY INFORMATION


(X € 1,000)

FAIR VALUE INVESTMENT PROPERTIES BY SEGMENTATION 3), DEVELOPMENT PROJECTS EXCLUDED 2012 2013 2014 2015 2016

Retail 377,503 380,882 597,048 607,026 659,905

Lease incentives 153 386 312 604 575

Fair value investment properties - retail 377,656 381,268 597,360 607,630 660,480

Offices 122,298 124,440 125,559 124,894 123,452

Lease incentives 1,025 1,266 1,377 958 577

Fair value investment properties - offices 123,323 125,706 126,936 125,852 124,029

500,979 506,974 724,296 733,482 784,509

(X € 1)

SHARE DATA 2012 2013 2014 2015 2016

Net result from core activities 4.87 5.09 5.29 5.63 5.78

Net result from non-core activities 1.00 0.42 0.87 1.49 3.77

Profit per share 6.04 5.51 6.16 7.12 9.55

Gross dividend 4.25 4.40 4.60 4.90 5.10

Net dividend 3.19 3.30 3.45 3.577 3.57

Net asset value before profit distribution 76.21 77.83 78.99 81.76 86.41

See note 4. Net result from core activities includes rental income, property charges, general expenses and financial results.1)

See note 4. Net result from non-core activities includes the result on the portfolio, results on disposal of real estate investments andother results (a.o. financial result) that are not included in the net result from core activities.

2)

2 CONSOLIDATED KEY INFORMATION


Belle-Île

3


MESSAGE TO THESHAREHOLDERS

3


Dirk AnbeekChief Executive Officer

Kasper DeforcheChief Executive Officer

FOCUS ON LEASING AND OPERATIONSAt the end of June 2016, we waved goodbyeto Luc Plasman as CEO of our company andKasper Deforche took over this role from him.We would like to take this opportunity tothank Luc once again for his dedication andthe part he’s played in the growth that we’veachieved in recent years.

Last year was characterized, it’s true, by a lessfavourable user market, which is curbingretailers’ urge for expansion and puttingrental levels under pressure. There is alsoincreasing competition from e-commerceand consumer confidence has been far fromunderstanding, so far. The upshot is that thenumber of visitors to Belgian shoppingcentres is showing a downward trend.

The right answer to these challenges is tocontinue to put the customer first. That’s whywe made several changes. The planningcontinues so that our company can focusmore on ‘Leasing’ (the Company’s lettingdepartment) and ‘Operations’ (managementof the portfolio). Consequently, we are morethan ever convinced that our strategy tomanage our shopping centres with internalteams is still the right choice.

All the above doesn’t mean that we didn’tmake progress on our propertydevelopment. Firstly, in February, a retailpark in Tournai was successfully completedand, soon after that, work started on theexpansion and renovation of the existingshopping centre.

In the last quarter we also got the good newsthat the permits for a possible expansion ofthe ‘Belle Ile’ shopping centre in Liège arenow final and enforceable.

3MESSAGE TO THE SHAREHOLDERS


Right at the end of 2016 a sale went throughtoo, namely the ‘Madou’ office building inBrussels. This is a new step in the dismantlingof the non-core offices portfolio which,currently, still accounts for ca. € 124 mln.

The company will continue to proactivelyexplore investment opportunities in the retailmarket. The changes that were announced tothe Statute of the RREC (regulated real estatecompany) will influence this favourably.

As for the financial results, we can be rightlyproud of the results achieved in 2016.

The net result in 2016, comprising the netresult of core and non-core activities, workedout at € 66.2 mln (2015: € 49.4 mln). Thisincrease is, on balance, compared to 2015,the consequence of a higher net result ofcore activities (€ 1.0 mln ) and a higher netresult of non-core activities (€ 15.9 mln).

To the General Meeting of Shareholders,a dividend will be proposed of € 5.10 gross- € 3.57 net (2015: € 4.90 gross - € 3.577 net)per share. The dividend will be payable asfrom 20 April 2017.

Finally, we would like to expressly thank allemployees, customers, shareholders as wellas all stakeholders for their continued effortsand contribution to the success of ourcompany.

Vilvoorde, 6 March 2017

3 MESSAGE TO THE SHAREHOLDERS


4


CONSOLIDATEDANNUAL REPORT

4


PROFILEWereldhave Belgium is a public regulatedreal estate company (RREC) with a focus oncommercial real estate in Belgium. Thecompany targets new investments inshopping centres. The value of theinvestment properties portfolio, includingproject developments, is € 819.8 mln. Theexisting operational shopping centreportfolio of € 660.5 mln (approximately84.2% of the total portfolio, excluding projectdevelopments) comprises shopping centresin Liège, Nivelles, Tournai, Ghent, Genk andKortrijk. In addition, the investmentproperties portfolio includes offices inBrussels, Vilvoorde and Antwerp. Thedevelopment portfolio of € 35.3 mlncomprises the land positions and investmentsmade relating to the extensionof ‘LesBastions’ shopping centre in Tournai and therestructuring and/or expansion of shoppingcentres in Waterloo and Liège.

Wereldhave Belgium seeks to generate valuethrough the active management of shoppingcentres and the (re)development of shoppingcentres for its own portfolio. The WereldhaveBelgium employees maintain direct contactwith the tenants. As a result, WereldhaveBelgium is aware of their tenants’ issuessooner, and has recent market information atits disposal. Those compentences are alsoused in the (re)development of projects.

STRUCTUREWereldhave Belgium has been an RREC since27 October 2014 and is subject to thelegislation of the Royal Decree of 13 July2014 and the Law of 12 May 2014. As suchthe RREC has been licensed and registeredby the Financial Services and MarketsAuthority since 22 September 2014.

Wereldhave Belgium has an RREC tax statusand, as a result, does not actually pay anycorporation tax, with the exception of anyabnormal and favourable benefits andrejected expenses.

Wereldhave Belgium Services NV, 100%subsidiary of the Company, is part of theconsolidation of Wereldhave Belgium andacts as the real estate manager of theinvestment properties portfolio.

The Wereldhave Belgium shares are tradedon the Euronext continuous stock exchangein Brussels.

On 31 December 2016 Wereldhave N.V.,Schiphol, directly or indirectly held 69.58% ofthe shares.

VALUATION OF REAL ESTATEWereldhave Belgium values its real estate atfair value. IFRS 13 defines the ‘fair value’ asthe price that would be received to sell anasset or paid to transfer a liability in anorderly transaction between marketparticipants on the valuation date. Thedefinition thus presumes a hypotheticaltransaction. So even if the Company intendsto use an asset rather than sell it, itdetermines the fair value based on the(hypothetical) sale price.

The investment properties portfolio is valuedexternally by independent real estate expertson a quarterly basis.

FINANCIAL POSITIONWith a consolidated debt ratio of 27.6% anda solvency of 72.4%, Wereldhave Belgiumpositions itself as a real estate company withvery sound balance sheet ratios.

4CONSOLIDATED ANNUAL REPORT


CORPORATE GOVERNANCE STATEMENT1

GENERALThe Company attaches great importance toachieving a balance between the interests ofthe providers of risk-bearing capital and theother stakeholders in the company.Openness, sufficient future-orientedprovision of information, and business ethicscomprise part of this philosophy. Thecompany ethics are embedded in theBusiness Principles and the Code of Conductfor personnel, which are published on thewebsite www.wereldhavebelgium.com.

In accordance with article 96, §2, 1° of theCompanies Code (as amended by the Law of6 April 2010 to strengthen the corporategovernance of publicly listed companies) andthe Royal Decree of 6 June 2010 on thedesignation of the Corporate GovernanceCode to be observed by publicly listedcompanies, the Company uses the CorporateGovernance Code 2009 as its referencecode.

The Belgian Corporate GovernmentGovernance Code is available on the websitewww.corporategovernancecommittee.be.The size of the Company is considered herealong with the specific management structureof Wereldhave Belgium, therefore makingthe corporate governance principles relevantto the management structure of theManagement Company.

In its Annual Financial Report, the Board ofDirectors must dedicate a specific chapter tocorporate governance in which the corporategovernance practices of the companythroughout the financial year concerned arediscussed, including the specific informationrequired by the applicable legislation and theCorporate Governance Code.

In accordance with article 96 §2 of theCompanies Code this Corporate GovernanceStatement must, as a bare minimum, containthe following information:

The Corporate Governance Code appliedby the company.

•

The main characteristics of the internalsystems for control and risk management(regarding financial reporting).

•

The shareholder structure, as derivedfrom the transparency declarations thatthe company has received from itsShareholders and specific financial andbusiness information.

•

The composition and operation of themanagement bodies and its committees.

•

The Charter and its Appendices stipulate therules, procedures and methods on the basisof which the Company is managed andmonitored.

The Charter is subject, without prejudice tothe Articles of Association of the Companyand the relevant provisions of Belgian law,such as the Companies Code. Anysummaries or descriptions in this Charter oflegal and statutory provisions, companystructures or contractual relations are onlyclarifications and may not be considered aslegal or fiscal advice on the interpretation orenforceability of such provisions or relations.

The Charter must be read together with thearticles of association of the Company, theAnnual Financial Report, and otherinformation that is periodically madeavailable by the company. Additionalinformation on each financial year relating tothe pertinent changes and events of theprevious financial year are reported in a CGStatement.

The Charter can be consulted on theCompany website(www.wereldhavebelgium.com) and shall beupdated as often as necessary. The Charterwas last updated on 29 January 2016 by theBoard of Directors.

4 CONSOLIDATED ANNUAL REPORT

1) The Corporate GovernanceStatement forms an integralpart of the Management Reportin accordance with article 96,§2 of the Companies Code.


COMPLY OR EXPLAIN PRINCIPLEDerogations from the recommendations inthe 2009 Code are underlined in theCorporate Governance Charter. To this endthe Company applies the principle of ‘complyor explain’.

On the date of this Annual Reportderogations from the following provisions ofthe 2009 Code are explained:

Composition of the remuneration committeeAs the company satisfies two (averagenumber of employees < 250 people andannual net turnover < 50 mln) of the threecriteria stipulated by article 526quater of theCompanies Code, the Board of Directors hasnot set up a remuneration committee.

The Board of Directors sees the work of theremuneration committee as the work of thefull Board of Directors, and this in derogationfrom provision 5.4./1 contained in appendixE of the 2009 Code, which stipulates that theremuneration committee consists exclusivelyof non-executive directors.

The remuneration committee of the Board ofDirectors consequently consists of allmembers of the Board of Directors (i.e.including the two chief executive officers).

Composition of the Audit CommitteeIn derogation from provision 5.5 of the2009 Code that stipulates that eachcommittee must consist of at least threemembers, the Audit Committee of the Boardof Directors of the Management Companyonly consists of two members.

Complying with the recommendation of the2009 Code that the Audit Committee musthave at least three members, would meanthat almost the entire Board of Directors isa member of the Audit Committee.

MANAGEMENT STRUCTURESThe Company has the legal form ofa partnership limited by shares according toBelgian law.


From left to right: Philippe Naert, Dirk Anbeek, Dirk Goeminne, KasperDeforche, Jacques de Smet and Luc Plasman (until 30/06/2016)


The Company has active and silent partners.The active partners have joint and severalunlimited liability for all obligations of thecompany. The sleeping partners are onlyliable for the debts and losses of theCompany up to the level of theircontribution, provided that they do not carryout any acts of management.

STATUTORY MANAGEMENTCOMPANYAccording to the Articles of Association, theCompany is managed by one or moremanagement companies, who must have thecapacity of active partner.

The Management Company is appointed byan Extraordinary General Meeting ofShareholders in the presence of a notary, andin observance of the requirements for anamendment of the Articles of Association.

The Management Company is authorised toperform all acts of internal management thatare necessary or useful for the realisation ofthe Company purpose, with the exception ofthose actions legally reserved to the GeneralMeeting of Shareholders.

The Management Company performs itsduties through the intervention of its Board ofDirectors. The appointment of theManagement Company is for a period ofindefinite duration.

The current Management Company isWereldhave Belgium N.V.


Genk Shopping 1


BOARD OF DIRECTORSBy virtue of the law and its Articles ofAssociation, the Board of Directors of theCompany is constituted such that the RRECcan be managed in accordance with article4 of the RREC Act. This principle is appliedwith the utmost stringency: the Company, theBoard of Directors and the ExecutiveManagers do not consider the specialinterests of Shareholders, the ManagementCompany, the Directors, the Developer orthe Executive Managers. The interests thatare taken into consideration in themanagement of the Company are not limitedto the Shareholders and extend to allcomponents of the notion of ‘corporateinterest’ that is referred to in the CompaniesCode.

The Board of Directors is the governingstructure of the Company. It acts jointly.

Thus the role of the Board of Directors is todetermine the strategic vision of theCompany, which is based on a contributionto long-term value, the supervision of thepolicy of the Executive Managers/ChiefExecutive Officers and the general state ofaffairs of the Company and its Subsidiaries.To this end it examines whether the riskshave been well evaluated and checks theirmanagement in the context of regular andstrict controls.

Social responsibility, mix and diversity ingeneral are also criteria in the decision-making process of the Board of Directors.

The Board of Directors has botha supervisory and advisory role and therebytargets the interests of the Company, thebusiness and all its Shareholders. The Board

of Directors acts as a committee with jointresponsibility without mandate andindependent of the partial interests involvedin the Company.

CompositionThe Board of Directors consists of at leastfour people, of which:

One or more Directors, with a maximumof half of the total number of Directors,can be executive directors. In other words,they can also exercise an operational rolewithin the company.

•

At least three Directors qualify as‘independent’ in the sense of article526ter of the Companies Code andAppendix A of the Corporate GovernanceCode.

•

The list of the members of the Board ofDirectors, published in the CG Statement,states which directors are independent.

The Board of Directors is composed such thatthere is a balance of skills and professionalexperience in disciplines such as real estate,finance and general management, withoutexcluding candidate directors whoseexperience in other areas and whosepersonalities would contribute to theCompany.

In accordance with article 518bis of theCompanies Code, the publicly listedcompanies are required to ensure that inprinciple a minimum of one third of theBoard of Directors is either male or femaledepending on the composition of theremainder, as of the first day of the sixthfinancial year commencing after thepublication of the Act of 28 July 2011 in theBelgian Official Gazette.



For publicly listed companies whose freefloat is less than 50% (free float of theCompany as per 31 December 2016:30.42%), applicable to the Company, thisrequirement only starts as of the first day ofthe eighth financial year commencing afterthe publication of the Act of 28 July 2011 inthe Belgian Official Gazette, i.e. 1 January2019. In accordance with article 96, §2, 6° ofthe Companies Code, the members of theBoard of Directors confirm they comply withand make the necessary efforts in order tosatisfy the legal conditions on genderdiversity. At the Annual General Meeting2017 of the Management Company, theBoard of Directors will nominate a femaledirector.

Every Director must also have the personalattributes enabling him/her to perform his/her work flexibly and jointly, but with fullindependence of mind.

He/she must have an impeccable reputationof integrity (especially with regard toconfidentiality, conflicts of interest and theprevention of abuse of privilegedinformation), have a critical and business-likeattitude and be able to develop a strategicvision.

Every Director must also be sufficientlymotivated and have enough time to attendthe meetings of the Board of Directors – andif applicable the meetings of thecommittee(s) he/she is a member of – and toprepare for these meetings.

For the composition of its Board of Directorsthe Company prefers complementarity ofskills, experience and knowledge and, insofarpossible, a mix of genders and diversity ingeneral.


Belle-Île


Two of the Directors are appointed as ChiefExecutive Officers and are responsible for theday-to-day management of the Company,and together form the ExecutiveManagement, and are thus ExecutiveManagers in the sense of the RREC Law. TheChief Executive Officers may not also act asChairman of the Board of Directors. TheChief Executive Officers are assisted in theexecution of their duties by the otherexecutive director(s) and a compactmanagement organisation.

The Board of Directors has decided not tocreate an ‘executive committee’ in the senseof the Companies Code.

Duration, appointment, evaluation andextension of the directors’ appointments

DurationThe duration of the directors’ mandates islimited to four years. The mandates arerenewable.

The Directors are appointed and theirmandate is renewed by the General Meetingof the Management Company, on proposalof the Board of Directors.

In order to ensure the continuity of the workof the Board of Directors and to preventseveral Directors resigning simultaneously,the Board of Directors has drawn upa schedule on the basis of which Directorsstep down periodically.

The most recent departure schedule for thenext three years drawn up by the Board ofDirectors shall be reported in the AnnualFinancial Report. For each Director it stateswhen he/she was first appointed and whenhe/she was last reappointed.

The directors do not have any mutual familyties.


Belle-Île


DIRECTORS POSITIONSTART DATE

MANDATEMOST RECENT

RENEWAL END OF MANDATELuc Plasman Managing Director

Executive Manager01/07/2011 30/06/2015 30/06/2016

Philippe Naert Independent DirectorMember of the Audit Committee

01/04/2015 31/03/2017

Jacques de Smet Independent DirectorChairman of the Audit Committee

01/04/2015 31/03/2018

Dirk Goeminne Independent DirectorChairman of the Board ofDirectors

01/04/2015 31/03/2019

Kasper Deforche Managing DirectorExecutive Manager

01/07/2016 31/03/2020

Dirk Anbeek Managing DirectorExecutive Manager

31/07/2012 13/07/2016 08/04/2020

AppointmentIn accordance with the RREC Law the peoplewho participate in the management or policyof the Company, without participating in theExecutive Management, must have theprerequisite expertise and experienceappropriate to the execution of their duties.

Before submitting its proposals to theGeneral Meeting, the Board of Directorsshall:

(1) Collect advice and recommendations, inparticular:

regarding the number of Directors itdeems desirable, without this numberfalling below the legal minimum;

•

regarding the compatibility of the profileof the Director whose appointment mustbe extended, if applicable, as required bythe Board of Directors;

•

regarding the definition of the desiredprofile, based on the general selectioncriteria for the Directors, and based on thelatest evaluation of the operation of theBoard of Directors (which shows thecurrent and required skills, knowledgeand experience within the Board ofDirectors), and any special criteria appliedin the search for one or more newDirectors.

•

(2) In turn, it shall interview the candidates, ifrequired check their curriculum vitae andreferences, take note of their other mandates(in publicly listed companies or otherwise)and evaluate them.

(3) Deliberate in accordance with the internalrules of the Boards of Directors.

The Board of Directors shall ensure that thereare appropriate plans for the succession ofthe Directors, ensure that each appointmentor each renewal of a Director’s mandate,both for executive and non-executiveDirectors, enables the continuity of theoperations of the Board of Directors and itscommittees to be guaranteed, and shallmaintain the balance in the skills andexperience of their members.



Non-executive Directors are made dulyaware of the scope of their duties at suchtime that they propose their candidacy, inparticular regarding their time managementin the context of their duties. They may nottake more than five directorships in publiclylisted companies into consideration. Anyalterations to their other relevantcommitments and new commitments outsidethe Company are reported to the Chairmanof the Board of Directors at the appropriatetime. The Chairman of the Board of Directorsreports this to the Secretary of the Company.

Each proposed appointment of a Director bythe General Meeting of Shareholders isaccompanied by a recommendation of theBoard of Directors. The proposal states theproposed duration of the appointment,which may not be longer than four years, andincludes relevant information about theprofessional qualifications of the candidate,together with a list of the positions that thecandidate already holds. The Board ofDirectors shall state which candidates meetthe independence criteria of Appendix A ofthe Corporate Governance Code. Withoutprejudice to the applicable legal provisionsin this respect, appointment proposals shallbe announced at least 24 days before theGeneral Meeting of Shareholders, togetherwith the other items on the agenda.

In the event of (re)appointment, a priorassessment of the profile outline shall takeplace. The reasons for re-appointment shallbe explained to the General Meeting ofShareholders. In event of re-appointment, theway in which the candidate has performedhis/her role as Director shall be taken intoaccount. The presence of a conflict of interestduring the underlying term shall be takeninto account for the decision.

If one or more Directors’ appointmentsbecome available, the remaining Directorshave the right to fill these provisionally untilthe next General Meeting of Shareholders,which shall conduct the final election.

All the members of the Board of Directorsmust be natural persons.

Professional developmentThe Chairman ensures that new Directors aregiven adequate initial training to enable themto contribute quickly to the Board ofDirectors.

The Directors shall continuously update theirknowledge of the affairs of the Company andthe development of the real estate sector.

The Directors shall set aside sufficient time toeffectively perform their duties and assumetheir responsibilities.

EvaluationUnder the leadership of its Chairman, theBoard of Directors regularly evaluates (atleast every two to three years) its size,composition, performance and that of itscommittees, as well as its interaction with theExecutive Managers/the ExecutiveManagement.

This evaluation process has four objectives:to assess the operation of the Board ofDirectors and its committees;

•

to check whether the key issues havebeen thoroughly prepared and discussed;

•

to evaluate the actual contribution ofevery Director, his/her attendance at themeetings of the Board of Directors andthe committees, as well as his/herconstructive involvement in thediscussions and the decision-makingprocess; and

•

to determine whether the currentcomposition of the Board of Directors orthe committees is in line with what isdesirable.

•



Current members of the Board of DirectorsThe Board of Directors consists of thefollowing five members (six until 30 June2016):

Dirk Anbeek, (53), WTC Schiphol Toren A,Schiphol Boulevard 233, 1118 BH Schiphol,The Netherlands, has been Chief ExecutiveOfficer and Executive Manager since 31 July2012. His appointment was renewedimmediately after the General Meeting of2016 for a period of four years until 8 April2020.

Mr D. Anbeek is also Chairman ofWereldhave N.V., reference shareholder ofWereldhave Belgium.

Nationality: Dutch

Before Dirk Anbeek was appointed asstatutory director of Wereldhave NV in 2012,he worked as a director for Albert Heijn EVPFranchise & Real Estate (2006-2009) and asSenior Vice President Business Planning& Performance (2004-2006). From1996-2004 Mr Anbeek held variousmanagement positions within Ahold. He wassenior consultant at PWC from 1994-1995.Furthermore, he held various managementpositions at DSM from 1988 to 1994.

(attendance rate during his mandate in 2016:100%)

Current mandates:Statutory director of Wereldhave NV(publicly listed)

•

Supervisory director of Ordina NV(publicly listed)

•

Supervisory director of Detailresult GroepNV

•

Mandates ending in the last five years:none•

Luc Plasman (63), Medialaan 30/6,1800 Vilvoorde, Director and Chief ExecutiveOfficer since 1 July 2011 to 30 June 2016;during this period, comprises the ExecutiveManagement of the Company together withD. Anbeek. He has several years ofexperience in the (re)development of realestate projects and is also Chairman of theBelgium-Luxembourg Council of ShoppingCentres (General Secretary since 1 January2017).

His appointment ended on 30 June 2019. Bymutual agreement the current mandate wasprematurely terminated on 30 June 2016.

Nationality: Belgian

Luc Plasman graduated in civil engineering atthe KUL in 1977. After two years of workingas an assistant at the Institute of IndustrialChemistry at the KUL, as of 1980 Luc Plasmanworked successively for ITH-Omnicadd NV(consulting engineers), IPEO/IGOPEX NV(project development) and WilmaProjectDevelopment NV (project development).From 1997 to 2010, Luc Plasman was ChiefExecutive Officer of ING Real EstateDevelopment Belgium NV.

(attendance rate during his mandate until30 June 2016: 100%)

Current mandates:Chairman (General Secretary) of theBelgium-Luxembourg Council ofShopping Centres (BLSC)

•

Independent director NV VANA RealEstate

•

Mandates ending in the last five years:Chief Executive Officer of WereldhaveBelgium NV (until 30 June 2016)

•

Director Wereldhave Belgium Services NV(until 30 June 2016)

•

Director WBPM (until 30 June 2016)•Director Halle Vastgoed (until 30 June2016)

•

Director Immo Guwy (until 30 June 2016)•



Director Waterloo Shopping bvba (until30 June 2016)

•

Kasper Deforche (35), Medialaan 30/6,1800 Vilvoorde, Director since 1 April2015 for a period of four years (until30 June2016 non-executive director, from1 July 2016 Executive Director). In addition toa Masters of Applied Economic Sciences atthe KU Leuven, he also holds degrees fromAntwerp Management School, SolvayBrussels School and Harvard BusinessSchool. He has more than 10 years ofexperience in retail real estate and haspreviously worked at AG Real Estate andVastned Retail Belgium.

Other mandates as director in publicly listedcompanies: none


Current mandates:Director Wereldhave Belgium Services NV•Director Multilist NV•Director Pandecadadia NV•Chief Executive Officer of WereldhaveBelgium NV (since 1 July 2016)

•

Director Wereldhave Belgium PropertyManagement (since 1 July 2016)

•

Director Halle Vastgoed (since 1 July2016)

•

Director Immo Guwy (since 1 July 2016)•Director Waterloo Shopping bvba (since1 July 2016)

•

Director Repsak BVBA•Director of the Belgium-LuxembourgCouncil of Shopping Centres (BLSC)

•

Mandates ending in the last five years:Director Ag Re B2C NV•Director Ag Real Estate Group AssetManagement NV

•

Director Ag Real Estate Westloan NV•Director Agridec NV•Director Citymo NV•

Director Gent Zuid NV•Director Ladolcevita NV•Director Ninia NV•Director Nouvelles Galeries De BoulevardAnspach NV

•

Director RDV-Invest NV•Director RF-Invest NV•Director RV-Invest NV•Director Senre BVBA•Director Shopimmo NV•Director Societe De DeveloppementCommercial D’anderlecht Pour 200 NV

•

Director Societe Hoteliere Du Wiltcher’sNV

•

Director Nobel NV•Director Urbis NV•Director Kanam Grund Kievitplein A NV•Director Kanam Grund Kievitplein B NV•Director Kanam Grund Kievitplein C NV•Director Kanam Grund KievitpleinD-E-F NV

•

Director Kanam Grund Kievitplein G NV•Director Kanam Grund Kievitplein H NV•Director Kanam Grund Kievitplein ParkingNV

•

Director Kanam Grund KievitpleinShopping NV

•

Director Kanam Grund Kievitplein J NV•

Dirk Goeminne (61), Oudeheerwegheide 77,9250 Waasmunster has internationalexperience in various retail concerns and canthus make an important contribution to thestrategic decision-making. He was appointedas independent Director and also Chairmanof the Board for a period of four yearsstarting on 1 April 2015 and ending on31 March 2019.


Dirk Goeminne graduated from the UFSIAAntwerp with a Master of Applied EconomicSciences in 1976 and as a commercialengineer in 1977, and started his career in1977 as an auditor at Price Waterhouse & Co.



As of 1979 Dirk Goeminne worked in thetextile and clothing industry and heldsuccessive management positions at ITC/IDECO, Femilux NV, WE Belgium – WEFrance – WE Luxemburg, WE Europe BV.Since 1997 he was successively ChiefOperating Officer and Chairman of theExecutive Board of Hema BV. From 2003 to2007 he was Chairman of the ExecutiveBoard of V & D and Member of the ExecutiveBoard of Maxeda.


Current mandates:Independent Director of Van de Velde NV(Publicly listed)

•

Supervisory Director of Beter Bed HoldingNV (The Netherlands)

•

Supervisory Director of Stern Groep NV•Chief Executive Officer of Ter Beke NV(Publicly listed)

•

Director JBC NV•Supervisory Director Wielco BV (TheNetherlands)

•

Mandates ending in the last five years:None•

Philippe Naert (73) Struikenlaan 13,2930 Brasschaat, has internationalexperience in general management andmarketing. He obtained a Master of CivilEngineering at the KUL in 1966,a ‘postgraduate diploma in ManagementScience’ at Manchester University (UK) in1967 and a Ph.D. in Business Administrationat Cornell University (US) in 1970. He wasappointed independent Director for a periodof two years starting on 1 April 2015 to31 March 2017.



Current mandates:Director of MDCS BVBA•


Gent Overpoort


Director of MDCS International NV•Chairman of the Board of Directors andindependent director of Natural GranenGebr De Scheemaecker

•

Chairman of the Board of Directors andindependent director of Hout vanSteenberge NV

•

Independent director of ConcordiaTextiles NV

•

Chairman of the Board of Directors andindependent director of Hobbyrama NV

•

Independent director of 3D NV•Independent director of MatériauxGondry

•

Independent director of Jori NV•Chairman and independent director ofDuror NV (Terre Blue)

•

Chairman and non-executive director ofOxford Policy Management Ltd

•

Chairman and independent director ofTruncus NV

•

Chairman and independent director ofChillafish NV

•

Mandates ending in the last five years:Director of Philippe Naert BVBA•Independent director of KBC Groep NV•Director and Dean of AntwerpManagement School

•

Independent director of Stock AmericainVan Wiemeersch

•

Chairman of the Board of Directors andindependent director of Floré

•

Independent director of Trilations NV•

Jacques de Smet (67), Hagedoornlaan 96,1180 Brussels has international financialexperience in various companies.

He was appointed as independent Directorfor a period of three years starting on 1 April2015 to 31 March 2018.


Jacques de Smet graduated from the VUBwith a Master of Economic Sciences in 1973.He has held various management positions invarious international companies.


Current mandates:Chief executive officer of Gefor NV•Independent director of Elia NV (publiclylisted)

•

Permanent representative of Gefor NV,member of the Board of Directors ofSabca NV (publicly listed)

•

Mandates ending in the last five years:none•



Statements concerning the directors andexecutive managementOn the basis of the information at its disposal,Wereldhave Belgium NV, StatutoryManagement Company, confirms that:

for at least the past five years neither itself,nor its Directors or, in the event ofcompanies acting as Director, theirpermanent representative, nor membersof the Executive Management:

•

have been convicted of fraud;•have been subject to official or publiclyexpressed accusations and/orimposed penalties by a legal orsupervisory authority (includingrecognised professionalorganisations), or have ever beendeclared incompetent by a court oflaw to act as a member of themanagement of a company or to act inthe context of the management or theperformance of the activities ofa company;

•

have had an executive position asa member of the management,leading or supervisory bodies ofa company at the time of a bankruptcy,receivership or liquidation.

•

there are currently no contracts ofemployment or service-providingagreements with the Directors, or with theRREC, or with the Statutory ManagementCompany, providing for specificpayments at the end of the employment.

•

the contracts of employment or service-providing agreements concludedbetween the Statutory ManagementCompany and/or the RREC and themembers of the Executive Managementdo not provide specific payments at theend of the employment.

•

ChairmanshipThe Board of Directors appoints one of itsindependent Directors as Chairman, on thebasis of his/her knowledge, abilities,experience and mediation skills.

The role of the Chairman consists ofindependently facilitating the operation ofthe Board of Directors and promoting thequality of the Company’s management.

The specific duties of the Chairman are:communication with the ExecutiveManagers/ Executive Management;

•

chairing the Board of Directors and theassociated tasks, as set out in the Charterand the Articles of Association of theCompany

•

negotiating with any advisors appointedby the Board of Directors;

•

discussing the results of the annualevaluation of the operation of the Boardof Directors with the members of theBoard.

•

to take also initiatives on subjects such asthe selection, (re)appointment andassessment of members of the Board ofDirectors, payment issues, contacts/communication with external advisers, inpreparation for the debate on thesesubjects in the plenary meeting of theBoard of Directors.

•

to ensure in particular that the bestCorporate Governance practices areapplied to the relations between theShareholders, the Board of Directors andthe Executive Managers/ ExecutiveManagement.

•

Moreover, the Chairman ensures that:new members of the Board of Directorsgo through an introduction and trainingprogramme;

•

the members of the Board of Directorspromptly receive all information requiredfor the proper performance of theirduties;

•

there is enough time for deliberations anddecision-making by the Board ofDirectors.

•

Furthermore, the Chairman carries out thetasks assigned to him/her by law, the Articlesof Association of the Company and the Boardof Directors.



Duties of the Board of DirectorsIn addition to its legal and statutoryobligations the Board of Directors carries outthe duties of the Management Company. Inthat capacity it is responsible for thefollowing tasks, among others:

The Board of Directors preserves thevalues and the strategy of the Company,its willingness to take risks and the mainpolicy guidelines.

•

Strategic decisions includinginvestments and disinvestments, theleasing strategy, the general operationof the Company, and decisions on anyinitiative presented to the Board ofDirectors.

•

The Board of Directors provides thenecessary financial and humanresources to enable the Company toachieve its objectives.

•

When realising its objectives, theBoard of Directors takes corporatesocial responsibility and diversity ingeneral into account.

•

The Board of Directors:•assesses the performance of theExecutive Managers/ExecutiveManagement and the realisation of theCompany’s strategy;

•

assesses the effectiveness of the AuditCommittee;

•

takes the necessary measures tosafeguard the integrity of theCompany, taking the assessment ofthe Compliance Officer into account;

•

takes the necessary measures for thetimely publication and communicationof the annual accounts and otherfinancial and non-financial informationto the Shareholders and potentialShareholders, in accordance with theexisting legislation and regulations;

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approves the internal control and riskmanagement structure set up by theExecutive Management and evaluatesits implementation, taking account ofthe assessment of the AuditCommittee and the personresponsible for the IndependentInternal Audit role and the Risk Officer;

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supervises the performance of theAuditor and the internal audit function,taking the assessment of the AuditCommittee into account;

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describes and publishes the mainfeatures of the internal control and riskmanagement systems of the Company.

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The Board of Directors decides on thestructure of the Executive Managementand defines the responsibilities entrustedto the Executive Management. They areincorporated in the internal rules of theBoard of Directors and of the ExecutiveManagement.

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Taking measures for a smooth andeffective dialogue with the current andpotential shareholders, and with thecustomers of the Company (i.e. users of itsreal estate), based on mutualunderstanding of the objectives andinterests, and in the interest of theCompany.

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Acceptance of the applicable rulesBy accepting his/her mandate, the Directoraccepts all the rules applicable to theManagement Company and the Company,and in particular the legislation on RRECs, theArticles of Association of the Company and ofthe Management Company, the Charter andthe Internal Rules.

Right of informationEvery Director is entitled to receive allinformation and documents required for theproper performance of his/her duties,without prejudice to the information anddocuments relating to corporateopportunities as defined in the Charter, andin the cases stipulated therein.



Operation

GeneralThe Articles of Association of the Companystipulate that the Management Companymust be organised in such a way that, withinits Board of Directors, at least two naturalpersons are responsible for the ExecutiveManagement of the Company, who togetherform the Executive Management and who arealso the Executive Managers in the sense ofthe RREC Law, as well as the Chief ExecutiveOfficers.

FrequencyThe Board of Directors meets at least fourtimes a year, and as often as necessary.

The frequency and schedule of the meetingsare defined by the Board of Directors in closeconsultation with the Chief ExecutiveOfficers. The meeting schedule is set for theentire calendar year, by the end of the thirdquarter of the previous calendar year at thelatest. Four meetings were held in 2016.

The Board of Directors discusses the strategyand the risks attached to the Company atleast once a year.

Notice of meeting and agendaThe Board of Directors meets after beingconvened by its Chairman or two Directors.The notice of meeting must be given at least24 hours before it convenes.

The notices of meeting are validly given byletter or any other telecommunication meansof a tangible medium. They include theagenda.

The agenda states the topics that shall beconsidered at the meeting.

The Chairman ensures that the Directorspunctually receive appropriate and correctinformation before the meetings so that theBoard of Directors can deliberate with soundknowledge of the facts.



In the preparation for the meeting of theBoard of Directors, the Directors shall spendthe necessary time to examine theinformation and the documents they receive,and shall request additional information anddocuments when they deem it appropriate.They undertake to actively participate in theactivities of the Board of Directors.

Chairmanship and secretariatThe Chairman chairs every meeting.

If absent, he is replaced by the oldestDirector.

The Board of Directors has appointeda Company Secretary. All Directors may availthemselves of the Secretary’s (E. DeLandtsheer) services.

ProxiesAny Director unable to attend may berepresented by another member of theBoard of Directors at a specific meeting. Theproxy must be appointed in writing, or by anyother telecommunication means of a tangiblemedium.

A Director may represent several colleaguesand cast as many votes for which he/she hasbeen appointed as proxy, in addition to his/her own vote.

Decisions, quorum and majorityExcept in the event of force majeure, theBoard of Directors may only validlydeliberate and decide if at least half of itsmembers are present or represented. If thiscondition is not met, a new meeting must beconvened which, provided that two Directorsare present or represented, shall validlydeliberate and decide on the items on theagenda of the previous meeting

Every decision of the Board of Directors istaken by an absolute majority of the Directorspresent or represented and, if one or more ofthem abstain, by a majority of the otherDirectors. In the event of a tie, the vote of theperson chairing the meeting shall bedecisive.

All Directors have one vote. Blank votes andabstentions shall be considered as not havingbeen cast when the number of votes iscounted. If, after a second vote there is nomajority on a decision to be made, theproposal shall be considered as rejected.


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In exceptional cases that can be suitablyjustified by extreme urgency and Companyinterests, the Board of Directors may takedecisions in writing. However, this proceduremay not be used for closing the annualaccounts and, if applicable, to call on theauthorised capital. The decisions must betaken by the unanimous agreement of theDirectors. The signatures of the Directorsshall be placed either on a single document,or on several copies thereof. These decisionsshall have the same validity as if they weretaken by a properly convened meeting of theBoard of Directors, and shall bear the date ofthe last signature placed on the above-mentioned document by the Directors.

MinutesThe deliberations and votes of the Board ofDirectors provide a summary of thediscussions, specify the decisions taken andreport any reservations of specific Directors.

They are signed by the Chairman of theBoard of Directors and at least one otherDirector and the members who so wish.

The original is intended for the archives ofWereldhave Belgium NV. The Companykeeps a copy for its own archives.

The Chairman, a Chief Executive Officer,each of whom acts in concert with anotherDirector, are authorised to authenticatecopies or excerpts of the minutes.

Transactions in company securitiesFor transactions in Company securities, theDirector is subject to the preventive rules onmarket abuse in Appendix 7 of the CorporateGovernance Charter.

For example, he/she must inform theCompliance Officer prior to any transaction.

Integrity and dedicationFor all Directors, both executive and non-executive, and for the latter irrespective ofwhether or not they are independent, it isnecessary that they can decide based on anindependent judgement.

The Directors ensure that they receivedetailed and accurate information, whichthey thoroughly study to obtain and maintaina good understanding of the main aspects ofthe company activities. They requestclarification whenever they deem itnecessary.

Although they are part of the same collectivebody, both executive and non-executiveDirectors each play a specific complementaryrole in the Board of Directors:

The executive Directors provide the Boardof Directors with all relevant and financialinformation so that the latter caneffectively fulfill its role.

•

The non-executive Directors present thestrategy and the main policy guidelines,as proposed by the Executive Managers,in a critical and constructive way fordiscussion, and help elaborate it further.

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The non-executive Directors closelyexamine the performance of the ExecutiveManagers in light of the agreedobjectives.

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The Directors must carefully handle theconfidential information they receive in theircapacity of Director.

A Director shall step down in the interim inthe event of inadequate performance,structural disagreement of opinions, andincompatibility of interests, or when it isotherwise warranted, such as if sufficientgrounds demonstrate that the Director’sintegrity has been jeopardised.

A business relationship between a Directorand the Company must be reported in theAnnual Financial Report.



A Director must immediately reporta (potential) direct or indirect conflict ofinterest to the Chairman. A Director involvedin a case of a conflict of interest shall provideall information on this to the Chairman,including the relevant information on his/herspouse, registered partner or other lifepartner, foster child, and blood relatives andrelatives by marriage up to the seconddegree.

The Director concerned shall not participatein the Board of Director’s assessment of theexistence of a conflict of interest.

There is a ‘conflict of interest’ when theCompany plans to enter into a transactionwith a legal person:

(i) in which a Director has a personal financialinterest;

(ii) in which a member of the board hasa family relationship with a Director;

(iii) in which a Director holds a managerial orsupervisory position.

The number of directorships of a member ofthe Board of Directors in other publicly listedcompanies and similar positions in non-listedcompanies or organisations is limited inorder to guarantee the proper performanceof the duties. To determine the number ofdirectorships that can be deemed acceptablein such companies in an individual case, theworkload resulting from these positions isultimately decisive. However, the maximumnumber of directorships in publicly listedcompanies is five.

In November, each Director reports alldirectorships and other similar positions thatcould affect the workload. The report is madeby updating a curriculum vitae to be sent outby the Secretary for publication in the AnnualFinancial Report.

For the individual Directors, the AnnualFinancial Report states the age, profession,main position, nationality and all otherdirectorships in publicly listed companies.Moreover, the most significant ancillary postsshall be reported, insofar significant toperform the role of Director.

The Directors require permission from theBoard of Directors to accept directorships inother publicly listed companies and similarpositions in non-listed companies ororganisations. The members of the Board ofDirectors shall request permission prior tothe publication of any nomination forappointment. The request shall be submittedto the Chairman. The Chairman shall submitsuch a request relating to him or herself totwo other members of the board.

THE COMMITTEES OF THE BOARDOF DIRECTORSIn accordance with articles 522, 526bis and526quater of the Companies Code, theManagement Company may form one ormore advisory committees within its ranksand under its exclusive responsibility, suchas, for example, a Strategic Committee, anAudit Committee, an AppointmentCommittee and a Remuneration Committee,and determine their internal rules.

The Board of Directors has created an AuditCommittee. The role, composition andoperation thereof are set out in the InternalRules of the Audit Committee that areattached as Appendix 3 of the Charter andform an integral part of it. Moreover, theBoard of Directors specifies the compositionand the operation of the Audit Committee inthe Corporate Governance Statement, whichforms a separate chapter of the AnnualFinancial Report.

As the Company only meets two (averagenumber of employees < 250 people and netannual turnover < 50 million) of the threecriteria stipulated by article 526quater of theCompanies Code, the Board of Directors hasnot set up a Remuneration Committee.



The Board of Directors has decided not to setup a Strategic Committee either. Moreover,the work of the Appointments Committee isperformed by the full Board of Directors. TheBoard of Directors believes that its limitedsize enables efficient deliberations on thetopics concerned. For the same reason,a Supervisory Committee of the ExecutiveManagers has not been created as theresponsibilities for this are exercised by theDirectors who are not Executive Managers.

THE AUDIT COMMITTEE

Composition and remunerationThe Audit Committee consists of twomembers appointed by the Board ofDirectors of the Management Company fromamong the independent Directors. Tocomply with the recommendation of theCorporate Governance Code that the AuditCommittee must have at least three memberswould lead to almost the entire Boardforming part of the Audit Committee.

The members of the Audit Committee musthave relevant knowledge and experience inaccordance with the provisions of theCorporate Governance Code, in particular inaccounting, audit and financial matters, withat least one ‘independent’ Director (In thiscase, Mr Jacques de Smet) holding a highereducation certificate in economics or financeor having acquired the relevant experience inthese subjects. The Audit Committee is notchaired by the Chairman of the Board ofDirectors.

The duration of the Audit Committeemembers’ mandate may not exceed theduration of their directorship. The end of anAudit Committee member’s mandate asDirector also cancels his Audit Committeemandate.

If a maximum of four meetings are held peryear, no attendance fees are paid to themembers of the Audit Committee, unlessdecided otherwise by the Board of Directors.

The current composition of the AuditCommittee:

Independent Director and Chairman

Jacques de SmetJacques de Smet has international financialexperience in various companies.Attendance quorum: 100% (4/4)

Independent Director

Philippe NaertPhilippe Naert has international experience ingeneral management and marketing.Attendance quorum: 100% (4/4)

ChairmanshipThe Management Company’s Board ofDirectors appoints the Chairman of theCommittee.He/she may not be the ManagementCompany’s Chairman of the Board ofDirectors.

The Chairman of the Audit Committee callsthe meetings and stipulates the agenda, afterconsulting the Chief Financial Officer (CFO).

The Chief Financial Officer (CFO) ensuresthat the members of the Committee reacha consensus, after critical and constructivediscussion of the items on the agenda.

The Chairman takes the necessary measuresto create a climate of trust within theCommittee and ensures its efficientoperation. He ensures, among others, thateach new member of the Committee isinducted smoothly, with the necessarypersonal contacts and the communication ofuseful information regarding the operation ofthe Committee in order to guarantee quickand efficient teamwork.

The Chairman is also the favoured point ofcontact of the Board of Directors regardingany matter for which the Committee isqualified.



ResponsibilitiesThe Committee assists the Board of Directorsand the Executive Managers in preservinga true and fair representation of theCompany accounts as well as the quality ofthe internal and external audits and theinformation supplied to Shareholders and themarket. To this end, the Committee providesthe necessary advice and recommendationsto the Board of Directors of the ManagementCompany and the Executive Managers.

Special duties of the Audit Committee:

(1) In the context of financial reporting andmonitoring of the process for theircompilation:

supervises the accounting integrity of thefinancial information provided by theCompany: the drafting of the statutoryannual accounts, consolidated accounts,the quarterly reports and the drafting ofimportant financial communications forpublication;

•

examines any change in the application ofthe accounting principles, analyses andvalidates the accounting policies and thereporting;

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obtains information from the ChiefFinancial Officer (CFO) about themethods to be used for accountingtreatment of significant and unusualoperations, when various accountingtreatments are possible;

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discusses the main financial reports withthe Chief Financial Officer (CFO) and theAuditor.

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(2) In the framework of the monitoring of theefficiency of the internal audit systems andthe risk management of the Company:

examines the internal audit and riskmanagement procedures applied by theCompany and its subsidiaries to ensurethat the risks have been properlyidentified, managed and reportedcorrectly to the Audit Committee;

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checks the description of the internalaudit and risk management procedures,which must be included in themanagement report;

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examines the report that the ExecutiveManager must present to the Board ofDirectors, the FSMA and the Auditor onthe evaluation of the internal auditprocedures (which are comprised of threeconcrete pillars, i.e. internal audit, riskmanagement and compliance, and thesepillars are supervised by the personresponsible for, respectively, theIndependent internal audit function, therisk management function (the RiskOfficer) and the compliance function (theCompliance Officer) – also called theindependent control functions). Examinesthe notes and the risk management in theAnnual Financial Report;

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examines the specific measures set up toenable staff or other people in contactwith the Company to confidentiallyexpress their concerns on possibleirregularities in the financial reporting orother matters;

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approves the internal audit operatingrules and any changes to them, and isresponsible for monitoring the efficiencyof the internal audit and executes theassignment given to it according to therelevant operating rules.

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(3) In the context of monitoring the annualand half year accounts:

ensures the follow-up of the Auditor’squestions and recommendations;

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examines the draft statutory annualaccounts and consolidated annualaccounts and expresses their opinion onthem before presenting them to theBoard of Directors;

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if necessary, consults the Chief FinancialOfficer (CFO) and the Auditor.

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(4) In the context of monitoring the externalaudit:

advises the Board of Directors on theappointment, re-appointment or dismissalof the Auditor and the amount of fees thatmust be paid for the execution of his/hercommission;

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verifies the independence of the Auditorof the Company;

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grants prior approval for everycommission entrusted to the Auditor ofthe Company, and which falls outsidetheir statutory role. Verifies the nature andscope of non-audit services provided, anddefines and applies a formal policy, whichstipulates what types of non-audit servicesare excluded or allowed after examinationby the Committee or automaticallyallowed, all this with the ‘one-to-one’ rulekept in mind;

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keeps itself apprised of the workprogramme of the Company Auditor;

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verifies the efficiency of the external auditprocedure.

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For the execution of its duties, theCommittee discusses the main items with theChief Financial Officer (CFO), the Auditor andany other person in the Company who itconsiders necessary to consult.

After reporting to the Chairman of the Boardof Directors, the Audit Committee mayrequest any advice and assistance from legal,accounting or other advisers that it deemsnecessary for the execution of its duties.

However, the Board of Directors has the solepower of decision.

The Audit Committee’s performance of itsduties does not in any way release the Boardof Directors and its members from their ownobligations and responsibilities.



Operation

MeetingsThe Audit Committee meets as often asnecessary for its proper operation, and in anycase at least four times per year, on therequest of its chairman, one of its members,the Chairman, a Chief Executive Officer andthe Chief Financial Officer (CFO). If necessaryor on the request of one of its members orthe Auditor, the Chairman of the AuditCommittee can fix extraordinary meetings.The members are expected to attend allmeetings of the committee. The AuditCommittee may speak with any relevantperson, without the presence of theExecutive Managers. The Chairman of theAudit Committee may request the Auditor toattend a meeting of the Audit Committee.

The Audit Committee meets at least twice peryear with the external auditor and the internalauditor in order to consult with them onsubjects relating to its internal rules and onall matters arising from the audit process, andin particular the significant weaknesses of theinternal audit.

The Audit Committee meets at least oncea year the Auditor for an exchange of ideason any issue that falls within its charge, andany issue raised by the audit process.

The Audit Committee may be assisted by theCompany Secretary in the performance of itsduties.

Moreover, for the performance of its role theAudit Committee may be assisted or advisedby one or more experts appointed by thecommittee in return for a fee to be borne bythe Company.

Although the Audit Committee is assignedwith the tasks and authorities set out in theserules, it is not the role of the Audit Committeeto plan or implement accountancy audits todetermine whether the financial reportingand publications of the Company arecomplete and comply with the applicable lawand regulations.

The Audit Committee may only exercise theauthorizations that the Board of Directors hasexpressly granted and may not exercise anypowers that extend further than theauthorizations of the Board of Directors.


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Each year, the Executive Managers/theExecutive Management report to the Boardof Directors on the developments in therelations with the Auditor, including inparticular its independence (including thedesirability of the rotation of the partnersconcerned within an Audit office that isassigned with the audit and the performanceof non-audit activities for the Company by thesame office).

The Audit Committee shall advise the Boardof Directors on the report. Also on thegrounds of this, the Board of Directorsstipulates its shortlist for the appointment ofan Auditor to the General Meeting ofShareholders.

Agenda – documents

The chairman of the Audit Committeespecifies the agenda for the meetings of theAudit Committee and reports to the Board ofDirectors. Except for urgent circumstances,the meetings of the Audit Committee shall beconvened at least five working daysbeforehand. The meeting of the AuditCommittee shall be scheduled beforehand,insofar possible, and forms part of theschedule for the preparation of the annualaccounts.

Every member of the Audit Committee hasaccess to the books, data and offices of theCompany and has the authority to conductmeetings with managers and employeesinsofar necessary or useful for the propercompletion of its task.

A member of the Audit Committee exercisesthis right in consultation with the chairman ofthe Audit Committee and the CompanySecretary.

Decisions, quorum and majorityIn order to validly deliberate, the twomembers of the Audit Committee must bepresent. A member of the Audit Committeemay not be represented by proxy. The adviceand recommendations are made bya majority. The chairman of the AuditCommittee does not have a decisive vote.

MinutesThe chairman of the Audit Committeeappoints a person who is responsible for thesecretariat of the Audit Committee and fordrawing up the minutes of the meetings.

The minutes provide a summary of thediscussions, specify the advice andrecommendations, and in particular state thereservations that the members of theCommittee made, if applicable. They shall bepresented as a draft to all members of theCommittee and are then formally approvedand signed during a subsequent meeting ofthe Committee.

The original is kept by the Company, whilea copy is handed to the Company Secretaryfor the files of the Company. The minutes arekept available for the Auditor.

A copy of the Audit Committee’s minutes isavailable for all the members of the Board ofDirectors.

ReportsAfter each meeting of the Audit Committeethe chairman of the Audit Committee (or inhis/her absence, another member of theAudit Committee appointed for this purpose)reports to the next meeting of the Board ofDirectors on the execution of its duties, andin particular after the meetings dedicated tothe compilation of the Annual Accountsintended for publication.



When the Audit Committee reports to theBoard of Directors, the Audit Committeediscusses the issues for which it considers anaction or improvement necessary, and makesrecommendations on the measures to betaken.

EvaluationAt least every three years the AuditCommittee evaluates its own efficiency,operation and its interaction with the Boardof Directors, re-examines its Internal Rules,and if applicable then recommends thenecessary adjustments to the Board ofDirectors.

EXECUTIVE MANAGERS / EXECUTIVEMANAGEMENTThe Internal Rules attached as Appendix 4 ofthe Charter and which form an integral partthereof, describe the role, composition andoperating rules.

In accordance with article 14, §3 of the RRECLaw, the actual management of the Companyis entrusted to at least two people, who holdthe title of ‘Executive Manager’ or member ofthe Executive Management or ChiefExecutive Officer. The Executive Managersare also the Chief Executive Officers (2) of theManagement Company’s Board of Directors.

The Executive Managers are currently:D. Anbeek, Chief Executive Officer of theBoard of Directors of the ManagementCompany

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K. Deforche, Chief Executive Officer of theBoard of Directors of the ManagementCompany

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RoleThe role of the Executive Managers isprimarily:

to propose the Company strategy to theBoard of Directors;

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to prepare all decisions that must betaken by the Board of Directors to fulfill itsobligations;

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to execute the decisions of the Board ofDirectors regarding the acquisition or thetransfer of real estate or shares of realestate companies in any form;

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to decide on the acquisition or transfer inany form of real estate or shares of realestate companies with a value, accordingto the general strategy stipulated by theBoard of Directors;

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to lease real estate, and more generally toenter into agreements in this respect, inaccordance with the general strategystipulated by the Board of Director;

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to ensure the day-to-day management ofthe Company, and report to the Board ofDirectors in this respect;

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to monitor the treasury position of theCompany, and to present the Board ofDirectors with a current, accurate andclear view of the operational and financialdevelopments of the Company and itsshareholdings;

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to organise internal audits (systems for theidentification, evaluation, managementand monitoring of financial, real estateand other risks, including the internalaudit and risk management systemsrelating to the financial reporting process,including the Annual Financial Report andthe consolidated Annual Accounts),without prejudice to the supervisory roleof the Board of Directors, based on theframework approved by the Board ofDirectors;

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to supervise the preparation of thefinancial statements, corresponding to theapplicable standards for Annual Accounts,accounting standards and accountingpolicies of the Company.

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the mandatory publication of the annualaccounts by the Company;

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to present an objective andunderstandable evaluation of the financialsituation, the budget and the ‘businessplan’ and the monitoring thereof, to theBoard of Directors;

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to hire and dismiss staff members anddetermine their remuneration, and

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to bear the general responsibility andliability on the internal audit proceduresthat comprise three specific pillars, i.e.internal audit, risk management andcompliance, and these pillars aresupervised by the person responsible for,respectively, the independent internalaudit function, the risk managementfunction (the Risk Officer) and thecompliance function (the ComplianceOfficer), also called the independentcontrol functions.

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DutiesThe Executive Managers participate in theinternal execution of Company activities andthe outlining of its policy. In this respect theirmain duties are:

to execute the decisions of the Board ofDirectors in general;

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to analyse the general policy and generalstrategy of the Company and, if need be,make proposals in this respect to theBoard of Directors, to actually execute thegeneral strategy and general policy of theCompany, as decided by the Board ofDirectors;

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to predefine the opportunities or theneeds with regard to investment,disinvestment and financing, and as thecase may be to make proposals in thisrespect to the Board of Directors;

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to direct and lead the management teamof the Company in accordance with thedecisions of the Board of Directors;

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to supervise the detailed, targeted,reliable and accurate preparation of thefinancial statements, according toaccounting standards and accountingpolicies of the Company, and to presentthe financial statements to the Board ofDirectors;

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to evaluate the financial situation, thebudget and the business plan of theCompany objectively and understandably,and to present the evaluation to the Boardof Directors.

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to execute internal audits (systems for theidentification, assessment, managementand monitoring of financial and otherrisks), without detracting from themonitoring role of the Board of Directorsand the role of the independent controlfunctions, i.e. the person assigned withthe independent internal audit function,the Risk Officer, and the ComplianceOfficer respectively;

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to report to the Board of Directors, theFSMA and the Auditor on the evaluationof the internal audit procedures, whichcomprise three specific pillars, i.e. internalaudit, risk management and compliance,and these pillars are supervised by theperson responsible for, respectively, theindependent internal audit function, theRisk Officer and the Compliance Officer;

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to prepare the publication of the financialstatements and the other financial andnon-financial information.

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The Executive Managers of the Companyperform their duties without prejudice to theauthorities of the Board of Directors.

The Executive Managers acting together areauthorised to represent the Company, andwith regard to the day-to-day managementthe Executive Managers, acting alone, areauthorised to represent the company.

OperationThe Executive Managers meet at least twiceper month, and also as often as necessary.

The Executive Managers take the necessarymeasures to create a climate of trust andclose mutual cooperation, by contributing toopen discussions and the constructivepresentation of divergent opinions.

The Executive Managers carry out their dutiescollectively.

Corporate GovernanceThe Executive Managers act in the soleinterest of all stakeholders. They organisetheir personal and business activities in sucha way as to avoid any direct or indirectconflicts of interest with the Company (asexplained in Appendix 7 of the CorporateGovernance Charter).

They do not make any decisions and do notact in matters within their purview ofresponsibility, even should they be placed ina situation of a conflict of interests with theCompany or with the sole interests of itsShareholders.

The Executive Managers undertake tocomply with the provisions of the BelgianCorporate Governance Code and thisCharter, in particular regarding the rules toprevent conflicts of interest and marketabuse. The provisions regarding ‘Integrityand dedication’ of Directors apply to theExecutive Managers.



SupervisionThe Executive Managers are responsible forthe execution of their duties, which they carryout under the supervision of the Board ofDirectors and without prejudice to the dutiesof the members of the Board of Directors.

The mandate of the Executive Managers runsrespectively until 31 March 2020 (K.Deforche) and 8 April 2020 (D. Anbeek)

The regularly report to the Board of Directorson the execution of duties.

AUDIT FUNCTIONSIn the context of its internal audit, theCompany must set up the internal auditprocedures, a risk management policy andan integrity policy.

These are additionally supervised by theperson responsible for the internal auditfunction, the risk management function andthe compliance function respectively(together they are the ‘independent auditfunctions’).

Independent compliance functionArticle 17, §4 of the RREC Law stipulates thatthe public Regulated Real Estate Company“must take the necessary measures to be ableto continually have a suitable independentcompliance function to ensure theobservance by the public Regulated RealEstate Company, its directors, executivemanagement, employees andrepresentatives, of the legal rules relating tothe integrity of the business of the publicRegulated Real Estate Company”. Article 6 ofthe RREC Royal Decree stipulates that thepublic Regulated Real Estate Company “musttake the necessary measures to be able topermanently have a suitable independentcompliance function. The compliancefunction is suitable when it ensures, withreasonable certainty, the observance by thepublic Regulated Real Estate Company, itsdirectors, executive managers, employeesand representatives, of the legal rules relatingto the integrity of the business of the publicRegulated Real Estate Company”.

The ‘independent compliance function’ canbe understood as an independent functionwithin the Company, aimed at examining andfostering the observance by the company ofthe rules relating to the integrity of Companyactivities. The rules concern those arisingfrom the company policy, status, and otherlegal and regulatory provisions.

In other words, this is a part of the corporateculture with an emphasis on honesty,integrity and the observance of high ethicalstandards in the conduct of business. Thesestandards require the company and itsemployees to behave with integrity, i.e.honestly, reliably and credibly.



Mr Laurent Trenson (Company employee andsenior accountant) was appointed as head ofthe independent compliance function on22 September 2014 in accordance witharticle 14, §4 of the RREC Law. Mr LaurentTrenson’s mandate of the independentcompliance function is for a duration of threeyears. In his capacity as the person in chargeof the compliance function, Mr LaurentTrenson reports to Mr Kasper Deforche, in hiscapacity as Executive Manager of theCompany and Chief Executive Officer ofWereldhave Belgium NV, i.e. the statutoryManagement Company of the Company.

Independent risk management functionArticle 17, §5 of the RREC Law stipulates thatthe public Regulated Real Estate Company“must have a suitable risk managementfunction and a suitable risk managementpolicy”. In the context of the ‘riskmanagement policy’ the company mustdemonstrate that it is able to effectivelyassess, control and monitor the (potential)exposure to risks (e.g. operational, market,liquidity and counterparty risks) attached toits ‘portfolio’ and other activities.

The person responsible for the riskmanagement function is responsible interalia, for drawing up, developing, monitoring,updating and implementing the riskmanagement policy and the riskmanagement procedures.

Mr Laurent Trenson (Company employee andsenior accountant) was appointed as head ofthe independent risk management functionon 22 September 2014 in accordance witharticle 14, §4 of the RREC Law. Mr LaurentTrenson’s mandate of the independent riskmanagement function is for a duration ofthree years. In his capacity as the person incharge of the risk management function, MrLaurent Trenson reports to Mr KasperDeforche, in his capacity as ExecutiveManager of the Company and ChiefExecutive Officer of Wereldhave Belgium NV,i.e. the statutory Management Company ofthe Company.

Independent internal audit functionArticle 17, §3 of the RREC Law stipulates thatthe public Regulated Real Estate Company“takes the necessary measures to be able tocontinue to be in possession of a suitableinternal audit function. The FSMA may allowdepartures to the provisions of the firstparagraph if the public Regulated Real EstateCompany demonstrates that this requirementis not proportionate and suitable in view ofthe nature, size and complexity of itsbusiness, without, however, being able todepart from the actual requirement topossess an internal audit function. The FSMAmay impose specific conditions for grantingsuch departures.”

The ‘internal audit’ can be understood as anindependent assessment function embeddedin the organisation. This function is aimed atinvestigating and evaluating the properoperation, effectiveness and efficiency of theinternal (audit) processes/proceduresapplied by the Company, including thecompliance function and the riskmanagement function. The personresponsible for the internal audit may givethe various members of the organisationanalyses, recommendations, advice,evaluations and information on the activitiesaudited, within the scope of the exercise oftheir responsibilities.



The Company has appointed the externalconsultant, JP Advisory Services BVBA,represented by its permanent representative,John Puttemans, appointed as the person incharge of the internal audit. Mr Dirk Anbeek(Chief Executive Officer and ExecutiveManager of Wereldhave Belgium N.V., i.e.the statutory Management Company of theCompany), has been appointed as non-operational Executive Manager, inaccordance with article 14, §4 of the RRECLaw, who supervises the internal auditfunction performed by JP Advisory ServicesBVBA and is thus considered to be theperson ultimately responsible for the internalaudit of the Company. The mandate of JPAdvisory Services BVBA as externalconsultant, and the mandate of Mr DirkAnbeek as the person ultimately responsiblefor the internal audit function, havea duration of three years from the date of22 September 2014.

REMUNERATION REPORT

REMUNERATION OF THEMANAGEMENT COMPANYThe Statutory Management Companyreceives a fixed remuneration for the exerciseof its mandate.

This remuneration covers the costs of theindependent Directors. The annualremuneration reflects the responsibilities andtime spent by the independent Directors.Costs may not be charged to the StatutoryManagement for non-independent Directors.

The remuneration method of the StatutoryManagement Company is described in article15 of the Articles of Association. It can thusonly be changed by a decision to amend theArticles of Association by the GeneralMeeting of Shareholders.

The remuneration is due per calendar yearand is payable after approval of the annualaccounts by the General Meeting ofShareholders. The remuneration of theManagement Company for 2016 was€ 120,000 (ex. VAT) and is paid by Comm. VAWereldhave Belgium.

The remuneration of the StatutoryManagement Company is subject tosupervision by the Auditor and satisfiesarticle 35, §1 of the RREC Law.



OVERVIEW OF INDIVIDUAL COMPENSATION DURING 2016

(ALL AMOUNTS ARE - WHERE APPLICABLE - EXCL. VAT)

INDEPENDENT NON-EXECUTIVE MANAGERS FIXEDDirk Goeminne - President 25,000Jacques de Smet - President of the Audit Committee 22,500Philippe Naert 20,000

DEPENDENT EXECUTIVE MANAGERSK. Deforche (until 30 June 2016) unpaid mandate 1)

Executive Management - Effective Leaders:D. Anbeek unpaid mandate

L. Plasmanunpaid mandate

(employee status)K. Deforche (since 1 Juli 2016) unpaid mandate 1)

1) See Remuneration of Executive Management members

REMUNERATION OF THE BOARD OFDIRECTORSThe remuneration amount for independentDirectors is determined by the ManagementCompany’s General Meeting, on theproposal of the Board of Directors.

The total remuneration consists of an annualfixed amount. The independent Directors areentitled to an annual fixed remuneration of€ 20,000. The Chairman of the Board ofDirectors receives an additional € 5,000 eachyear, the Chairman of the Audit Committee€ 2,500. Independent directors are notentitled to variable remuneration or otherbenefits.

The remuneration amount for non-independent executive Directors isestablished in agreement with the StatutoryManagement Company and is determined bythe Board of Directors. The same procedureis applied for every adjustment ofremuneration for the dependent Directors.The remuneration methodology relating toKasper Deforche is explained in detail in thechapter 'Remuneration of ExecutiveManagement members’. The mandate of DirkAnbeek is unpaid. He represents thereference shareholder and receivesa remuneration in this respect.

The Remuneration Policy of the Companypurposes to offer those involved with thecompany’s management, remuneration suchthat it can attract, keep and motivate thedesired profiles.



The Statutory Management Company wishesto offer those involved a level ofremuneration comparable to that which isoffered by other companies for similarpositions. Except in the event of a decision bythe Management Company to the contrary,the remuneration policy shall not be alteredover the next two years.

In order to keep informed of theremuneration applicable on the market, theStatutory Management Company participatesin benchmarks of social secretariats orspecialised consultants. It may also consultthese specialists occasionally irrespective ofany benchmarks.

For a more in-depth perspective on thecharacteristics of the various categories ofthose who collect remuneration, one canconsult other chapters of the GovernanceCharter.


Tournai


REMUNERATION OF THE EXECUTIVEMANAGEMENTThe Remuneration Policy of the Companyrelating to the Executive Management isa matter for the Board of Directors of theStatutory Management Company.Remuneration of the Executive Managementis evaluated annually. The Board of Directorsof the Statutory Management Company hasdeveloped and approved a suitableRemuneration Policy that consists of twocomponents:

a fixed remuneration;•a variable remuneration in the short andlong term.

•

The Company complies with theremuneration policy of the Companies Codeand the Royal Decree applicable toRegulated Real Estate Companies, as well asthe principles of the Corporate GovernanceCode.

Each year, the Board of Directors of theStatutory Management Company analysesthe remuneration policy for the members ofthe Executive Management and examineswhether an adjustment is required. Allcomponents of the remuneration policy areanalysed. This analysis is coupled with anassessment (benchmarking) of theremuneration policy of other publicly listedreal estate companies.

REMUNERATION OF EXECUTIVEMANAGEMENT MEMBERSThe amount of remuneration for ExecutiveManagement members consists of thefollowing components: a fixed remunerationand a short term and long-term variableremuneration. The mandate of Dirk Anbeek isnot remunerated. He represents thereference shareholder and receivesa remuneration in this respect.

Fixed remuneration for ExecutiveManagement members is determinedaccording to their individual responsibilitiesand skills. This remuneration is not related tothe profit of the RREC.

Variable remuneration is determined andbased on the effective realisation of thefinancial and qualitative objectives that areannually established and evaluated by theBoard of Directors of the StatutoryManagement Company. These objectives aredetermined according to well definedcriteria, weighted according to theirimportance, and approved by the Board ofDirectors of the Statutory ManagementCompany.



Short-term variable remuneration:For financial year 2016 the evaluation criteriafor determining variable remuneration wereas follows: the direct profit per share (25%),occupancy rate (25%), the like-for-like rentgrowth (25%), the progress of thedevelopment portfolio (10%), and theGeneral Management (15%).

The Board of Directors of the StatutoryManagement Company evaluated therealisation of these objectives for 2016, andset short term variable remuneration at€ 70,000 for Kasper Deforche (*).Followingthe termination of employment (employeestatus) between the Company and LucPlasman dated 30 October 2016, a lumpsum of € 144,000 has been granted.

Long-term variable remuneration:The Board of Directors of the StatutoryManagement Company evaluated therealisation of these objectives for 2016, andset the variable remuneration at € 80,000 forKasper Deforche (*).

Allocation criteria/objectives:The Company achieved its targets for2016:

•

earnings per share (EPS) (75%);•sustainability (25%).•

Conditions:

Half payable in the second year followingthe year for which the allowance isgranted and the other half in the thirdyear in which the allowance is granted;

•

Employed by the company at the time ofpayment;

•

If the employment has ended before thepayment date as a result of anorganisational decision that is not relatedto performance, the variableremuneration remains earned.

•

Except in the event of a decision to thecontrary by the Management Company, theRemuneration Policy shall not be altered overthe next two years.

The other benefits include thereimbursement of professional expensesincurred in relation to their position.

The contracts of the Executive Managementdo not provide a right to reclaim variableremuneration that is attributable to incorrectfinancial data.

Members of the Executive Management holdno shares, share options or other rights toacquire shares.

The Ordinary General Meeting ofShareholders that decides on the AnnualFinancial Report of the StatutoryManagement Company’s Board of Directorsshall also decide on the remuneration reportby a separate vote.



2016

FIXED

COMPENSATION

VARIABLE

COMPENSATION

SHORT TERM

VARIABLE

COMPENSATION

LONG TERM

RETIREMENT

PLAN

FRINGE

BENEFITS TOTAL

L. Plasman (until

30/10/2016) € 350,111 € 0 € 0 € 10,341 € 5,228 € 365,681

€ 275,000 € 70,000 € 80,000 € 0 € 0 € 425,000

D. Anbeek unsalaried mandate

2016

FIXED

COMPENSATION

VARIABLE

COMPENSATION

SHORT TERM

VARIABLE

COMPENSATION

LONG TERM

RETIREMENT

PLAN

FRINGE

BENEFITS TOTAL

L. Plasman € 203,960 € 72,000 € 72,000 € 11,282 € 3,974 € 363,216

D. Anbeek unsalaried mandate

*Details on service agreementsa.Service agreement between KasperDeforche and the Company for holdingthe position of CEO of the relevant listedentity. There is an annual fixed fee of€ 125,000 for financial year 2016 (from1 July 2016, € 150,000) and variableremuneration amounting to at least€ 50,000 and a maximum of€ 100,000 (excl. VAT) which is payable forhalf in the second year following the yearfor which the remuneration was grantedand the other half in the third yearfollowing the year for which theremuneration was granted. A flat rate of12 months' remuneration is foreseen inthe event of termination by the Company.

b.Service agreement between REPSAKBVBA, with registered office at Onze LieveHeerweg 16 – 1860 Meise, with aspermanent representative KasperDeforche, and Wereldhave BelgiumServices NV, for handling the operationalmanagement of the relevant managemententity. There is an annual fixed fee of€ 125,000 for financial year 2016 (from1 July, € 150,000) and variableremuneration amounting to at least€ 50,000 and a maximum of€ 100,000 (excl. VAT) which is payable inthe second year following the year forwhich the remuneration was granted.A flat rate of 12 months' remuneration isforeseen in the event of termination bythe Company.



PREVENTION AND CONFLICTS OF INTERESTS

Conflicts of interests and conflictingfunctionsThe Director arranges his personal andprofessional interests in such a way that allconflicts with the interests of the Companyare ruled out and correspond exclusively withthe interests of the Shareholders.

The Director informs the Board of Directorsof conflicts of interests, and if applicable, hedoes not vote on the point in question, inaccordance with the Companies Code.

Every Director who determines thata transaction brought before the Board ofDirectors is of such a nature as to be ofinterest to a different company in which heperforms a director’s mandate or othermandate, shall immediately notify theChairman of the Board of Directors of this.Only if the entity that he is part of appliesappropriate ‘Chinese Walls’ procedures, hewithdraws from the deliberation anddecision-making process with regard to thistransaction and does not receive theinformation regarding the transaction, in

accordance with what is stipulated in thisrespect in the Charter.

A Director may accept mandates at othercompanies, as long as he does not performmore than five director’s mandates in listedcompanies and as long as he complies withthe obligations regarding notification ofthese mandates that are stipulated in theCharter. Every Director who is planning toaccept a mandate in addition to the one he iscarrying out (excluding director’s mandatesin companies that are controlled by theCompany and excluding director’s mandatesthat are, according to the judgement of theDirector in question, not of such a nature thatthey influence his availability) notifies theChairman of this fact, and examines togetherwith the Chairman whether this new burdenleaves him with sufficient availability for theCompany.

Preventive rules for conflicts of interestsRegarding the prevention of conflicts ofinterests, the Company is, on the one hand,subject to the articles 523 and 524 of theCompanies Code and the articles 36, 37 and38 of the RREC Law, and on the other hand, itis subject to the stipulations of its CorporateGovernance Charter.

Article 523 of the Companies Code stipulatesthat a director with an interest of a propertymanagement-related nature that is in conflictwith a decision or a transaction falling underthe authority of the Board of Directors, mustnotify the other directors of this before theBoard of Directors makes a decision, andmust refrain from participating in thedeliberations or the vote; the minutes of theBoard of Directors must contain the legallyprescribed statements. The CorporateGovernance Charter clarifies that transactionsbetween the Company and its directors musttake place in accordance with the usualmarket conditions. Such transactions are alsopublished in the Annual report, with mentionof the conflict of interests and the statementthat the stipulations regarding this have beencomplied with.



Article 524 of the Companies Code alsorequires decisions or transactions performedin execution of decisions of the Company (orits subsidiaries) that relate to therelationships with connected companies(excluding those with their respectivesubsidiaries) to be submitted to a committeeof independent Directors, assisted by one ormultiple independent experts, for advice.The aforementioned procedure does notapply to (i) usual decisions and transactionsthat have taken place under usual marketconditions for similar transactions and (ii)decisions and transactions that represent lessthan 1% of the net assets of the Companyaccording to the most recent consolidatedAnnual Accounts.

Article 37 of the RREC Law stipulates that theFSMA must be notified of transactionsplanned by the public Regulated Real EstateCompany or one of its subsidiaries if one ormultiple of the following persons is directly orindirectly acting as a counterparty in thattransaction or gains any property benefitfrom it:

the persons that control the publicRegulated Real Estate Company or ownparticipation in it;

•

the persons with whom (a) the publicRegulated Real Estate company, (b)a subsidiary of the public Regulated RealEstate Company, (c) the businessmanager-legal person of the publicRegulated Real Estate Company in theform of a partnership limited by shares, orof a company controlled by the same, (d)the promotor and (e) the othershareholders of a subsidiary of the publicRegulated Real Estate Company areconnected or are linked by virtue ofparticipating interest;

•

the business manager-legal person of thepublic Regulated Real Estate Company orone of its subsidiaries that has taken theform of a partnership limited by shares;

•

the promotor of the public Regulated RealEstate Company;

•

the other shareholders of all subsidiariesof the public Regulated Real EstateCompany; or

•


Belle-Île


the directors, the business managers, themembers of the management committee,the persons entrusted with the dailymanagement, the senior managers or theagents:

•

of the public Regulated Real EstateCompany or one of its subsidiaries;

•

of the business manager-legal personof the public Regulated Real EstateCompany or one of its subsidiaries thathas taken the form of a partnershiplimited by shares;

•

of the promotor;•of the other shareholder of anysubsidiary of the public Regulated RealEstate Company; and

•

of a person that controls the publicRegulated Real Estate Company orowns participation in it.

•

In its notification to the FSMA, the Companymust demonstrate that the plannedtransaction is in its interest, and must alsodemonstrate that the transaction has a placewithin the normal course of its businessstrategy.

Transactions covered by article 37, § 1 of theRREC Law must be carried out under normalmarket conditions (article 37, §3 of the RREC-Law).

The Company must comply with the valuationof the expert in accordance with article 49,§ 2, of the RREC Law when a transaction withthe above-mentioned persons relates to realestate.

The provisions of Articles 36 and 37 of theRREC law do not apply to:

transactions involving a sum that is lessthan the lowest amount of either 1% of theconsolidated assets of the publicRegulated Real Estate Company or€ 2,500,000;

•

the acquisition of securities by the publicRREC or one of its subsidiaries in thecontext of a public issue by a third-partyissuer, for which a promoter or one of thepersons referred to in Article 37, § 1 actsas intermediary within the meaning ofArticle 2, 10° of the Law of 2 August 2002;

•

the acquisition of or subscription to theshares in the public RREC issued asa result of a decision by the generalmeeting by the persons referred to inArticle 37, § 1; and

•

transactions involving the liquid assets ofthe public RREC or one of its subsidiaries,provided by the person acting ascounterparty has the capacity ofintermediary within the meaning of Article2, 10° of the law of 2 August 2002 andthat these transactions are executedunder normal market conditions.

•

Overview of conflicts of interests in theprevious and current financial yearThere have been no conflicts of interestswithin the Company between the Company,its Business Manager and the members of theBoard of Directors in the previous financialyear and in the current financial year up tothe Date of this Annual Report.



CODE OF CONDUCT FOR FINANCIALTRANSACTIONS

IntroductionInsider trading is the purchase or sale ofshares or other financial instruments whilemaking use of accurate and important not-yet-published information regarding theCompany, its clients or suppliers with theintent of gaining unjustified advantage.Insider information is information that couldbe used by a reasonable investor in his/herinvestment decision. Insider trading isunethical and is illegal in most countries. It isalso unethical and, in some cases, illegal, toshare insider information that one hasobtained within the context of one’s position,other than within the normal scope ofexecuting one’s position.

The Company has decided to improveprevention of insider trading by adoptinga policy and by implementing a specificprocedure. Insider trading is a part ofcriminal law: the persons involved, as well asthe company, can become the object ofcriminal and/or administrative prosecution. Italso increases the risk that procedures areinstituted against the Company, its Directorsand the Senior Managers, and that theirliability is at stake in procedures with regardto fraud with financial instruments.Notwithstanding this policy, the Companyexpects legal and ethical conduct from itsDirectors, Senior Manager and Employees.

ObjectiveThe Company has adopted this policy withregard to its Directors, Executive Managers,Employees, family members and appointedthird parties that have access to insiderinformation regarding the Company, in orderto avoid any (appearance of) violation of thelaws governing:

the purchase and sale of securities issuedby the Company while the personinvolved had insider information at his/herdisposal (information that was notpublished, was accurate and important,and which could significantly influence theshare price of the financial instrumentsinvolved);

•

providing insider information to thirdparties.

•

ScopeThis policy applies to Directors, ExecutiveManagers, Wereldhave Group employees,their family members (together the ‘Insiders’)and all third parties who have insideinformation about the Company due to theirconnections.

The present policy applies to all transactionsinvolving securities issued by the Company,including the shares, share options and allother securities that the Company couldissue, such as preference shares, convertiblebonds, warrants and listed options or anyother derived product. The policy alsoapplies to all securities of which theunderlying value is the share of theCompany, regardless of the issuer. Securitiesthat are purchased or sold for the account ofa Director, Senior Manager or employee ofWereldhave Group in execution of a contractfor the discretionary management ofa securities portfolio entered into with a bankor registered financial intermediary are notconsidered to have been purchased or soldby the Insider.

After the policy text has been approved bythe members of the Board of Directors,a copy is transmitted to every Director,Executive Manager, employee or designatedthird party; every new Director, ExecutiveManager, employee and designated thirdparty will receive a copy of the policy at themoment he/she becomes employed by or atthe beginning of his/her relationship with theCompany.



Directors, Executive Managers and keyemployees

Directors and Executive ManagersThe Directors and Senior Managers haveregular or occasional access to insiderinformation. They are advised to exercise duecaution when purchasing or selling Companysecurities. In case of doubt they can consultthe Compliance Officer.

Key employeesDue to their position in the Company andtheir regular or occasional access to insiderinformation, key employees must exercisedue caution when purchasing or sellingCompany securities. The Company willmodify the list of key employees at theappropriate time in order to include thenames of new key employees and to removethe names of key employees that have leftthe Company.

Risk & Compliance Officer – Internal AuditEvery public Regulated Real Estate Companymust apply internal audit procedures, a riskmanagement policy and an integrity policywithin the framework of its internalmonitoring. It is supervised by the personcharged with respective functions of internalaudit, risk management and compliance inaccordance with article 17, § 3, 4 and 5 of theRREC Law (these are referred to as the‘independent checking functions’collectively).

Definition of ‘insider information’On 3 July 2016, the European Market AbuseRegulation (or "MAR") entered into force. TheMarket Abuse Regulation is directlyapplicable in all EU Member States andcontains rules that apply to all who wish totrade in securities of the Company or otheraffiliates.

Concerning this Market Abuse Regulation,the Company has adopted new regulationsfor its employees, management anddirectors, with rules for ownership of andtransactions in shares of Wereldhave Belgiumor in derivative financial instruments such asoutstanding stock options or convertiblebonds.

In the context of the aforementioned MarketAbuse Regulation, market abuse must beinterpreted as (i) insider trading, (ii) theunlawful disclosure of insider information,and (iii) market manipulation.

In application of article 17 MAR, forbiddenare a) insider trading or attempts at insidertrading, b) advising others to engage ininsider trading or c) unlawfullycommunicating insider information. Inapplication of article 18 MAR, it is forbiddento manipulate or attempt to manipulate themarket (as market manipulation is defined inarticle 12 MAR).

In accordance with article 7 MAR, insiderinformation is defined as any non-publicinformation that is specifically and directly orindirectly related to the Company or itsFinancial Instruments, which, if it were madepublic, could have a significant impact on theprice of these Financial Instruments.

Information is considered to probably havea significant impact on the price of FinancialInstruments if a reasonable investor would belikely to use this information to base in parthis or her investment decisions upon.

Information is deemed to be specific if itrelates to a situation that exists or which mayreasonably be assumed will occur, or to anevent that has occurred or which mayreasonably be assumed will occur, and if theinformation is specific enough to drawa conclusion on the possible impact of thesituation or event intended above on theprices of Financial Instruments.



In the case of a process spread over time thatis intended to cause a particular situation orevent take place, or that results in a certainsituation or event, this future situation orfuture event, as well as the intermediate stepsin this process related to the creation or theoccurrence of such a future situation or futureevent, is considered specific information inthis context. An intermediate step in theprocess spread over time is considered asinsider information if this intermediate stepmeets the criteria for insider information.

In application of article 8 MAR, insidertrading takes place when a person who hasinsider information uses this information forhis or her own account or on behalf of thirdparties to acquire or dispose of, directly orindirectly, financial instruments to which thatinformation relates. The use of insiderinformation for cancelling or changing anorder concerning a financial instrument towhich the information relates, when the orderwas placed before the person concernedpossessed the insider information inquestion, shall also be considered as insidertrading.

Consulting the Compliance OfficerEvery Insider who wishes to be certain as towhether the information that he/she hasaccess to is accurate and important andpublic, is advised to consult the ComplianceOfficer before purchasing or sellingCompany securities.

Policy of the Company and procedures

Prohibited activitiesInsiders are prohibited from purchasingor selling Company securities if they haveaccess to insider information about theCompany;

•

Insiders may not purchase or sellCompany securities outside the tradingwindows as described below, or duringspecial closed periods to be determinedby the Compliance Officer;

•

Directors, Executive Managers and keyemployees may only purchase or sellCompany securities after they haveinformed the Compliance Officer of this inaccordance with the procedure describedbelow. The Directors, Executive Managersand key employees are advised to keeptrack of documents that demonstrate thereason of purchase or sale to the extentpossible;

•

Insiders shall not notify third parties(including their family members, analysts,private investors, members of aninvestment group and news media) ofinsider information concerning theCompany, except in the framework of thenormal exercise of their role within theCompany, and only after having receivedpermission for this from the ComplianceOfficer. If insider information is sharedwith third parties, the Company will takethe necessary steps to safeguard theconfidentiality of the information, forexample by asking the third party toconfirm in writing that he/she/it willrespect the stipulations of the policy and/or having him/her/it sign a confidentialityagreement. Every question of third partiesregarding accurate and important not-yetpublic information about the Companymust be transmitted to the ComplianceOfficer;

•

Insiders shall not make anyrecommendations regarding thepurchase or sale of Company securitieswhen they have access to insiderinformation regarding the Company,except that Insiders must recommendthird parties against purchasing or sellingCompany securities if this purchase orsale would constitute a breach of the lawor of the policy. The Company stronglyadvises Insiders not to utter anyrecommendations to third partiesregarding the purchase and sale ofsecurities of the Company, not even whenthey do not have access to insiderinformation regarding the Company;

•



Insiders shall not purchase or sell anysecurities of a different listed company oradvise third parties to purchase or sellthose securities or share insiderinformation about that other publiccompany while they have access to insiderinformation about that company withinthe context of their position within theCompany.

•

Trading windows and closed periods

Trading windows for Directors, ExecutiveManagers and key employees.After having informed the ComplianceOfficer in accordance with the proceduredescribed hereafter, the Directors, ExecutiveManagers and key employees may purchaseand sell Company securities during a periodthat starts at the closing of the stockexchange on the second complete businessday following publication by the Company ofits report regarding its (quarterly, biannualor) Annual Results, and ends at the closing ofthe stock exchange on the last day of thequarter in question.

Trading windows for other Insiders.Insiders who are not Directors, ExecutiveManagers or key employees may purchase orsell securities of the Company duringa period that starts at the closing of the stockexchange on the second complete businessday following publication by the Company ofits report regarding its (quarterly, biannualor) Annual Results, and ends at the closing ofthe stock exchange on the last day of thequarter in question.

No purchasing or selling during a tradingwindow for persons that have access toinsider information.Insiders that have access to insiderinformation regarding the Company shall notpurchase or sell Company securities, noteven during trading windows. Whoever hasaccess to insider information may onlypurchase or sell during a trading windowafter closing of the stock exchange on thesecond complete business day following thepublication of the information in question bythe Company.

No purchasing or selling during the closedperiod, nor during special closed periods.Insiders shall not purchase or sell Companysecurities outside the applicable tradingwindows or during special closed periodsthat the Compliance Officer shall determine.Insiders shall not notify third parties thata special closed period has beendetermined.

In application of article 19, section 11 MAR,a person with managerial responsibilities atthe Company in principle must refrain fromcarrying out transactions for his or her ownaccount or, directly or indirectly, for theaccount of a third party, relating to shares ordebt instruments of the Company or toderivatives or other related FinancialInstruments during a closed period of thirtycalendar days prior to the publication of theannual and half-yearly financial report.

A "person with managerial responsibilities" isa person who:



is a member of a management orsupervisory body;

a.

has a managerial position but is not partof the bodies referred to under a) andwho has regular access to insiderinformation relating directly or indirectlyto the Company, and who also has thepower to take management decisionsaffecting the future developments andbusiness prospects of the company.

b.

Exceptions for exceptional circumstances.The Compliance Officer may allow thepurchase or sale of Company securitiesoutside the applicable trading windows (withthe exception of the special closed periods)on an individual basis, taking into accountspecial (financial or other) circumstances.

ProcedureDirectors, Executive Managers and keyemployees may only purchase or sellCompany securities after:

having informed the Compliance Officerin writing of the number of securitiesinvolved and the nature of the transactionplanned;

•

having provided written confirmation tothe Compliance Officer that they do nothave access to insider informationregarding the Company, at the latest twodays before carrying out the plannedtransaction.

•

The Compliance Officer may allow thepurchasing or sale of Company securities onan individual basis outside the applicabletrading windows due to special (financial orother) circumstances.

If this occurs, the following procedureapplies:

the person involved notifies theCompliance Officer in writing of thespecial circumstances as well as thenumber of securities and the nature of thetransaction planned;

•


Medialaan 32 b


the person involved provides writtenconfirmation to the Compliance Officerthat he/she does not have access toinsider information regarding theCompany, a maximum of two days beforethe planned transaction; and

•

the Compliance Officer provides writtenpermission to carry out this transaction.

•

Precedence of legal restrictionsIf legislation imposes more restrictions thanthe Insiders policy, the restrictions imposedby legislation apply. If insiders wish to knowwhether there are any stricter legalrestrictions, they can consult the ComplianceOfficer.

Possibly civil, criminal and disciplinarysanctions

Civil and criminal sanctionsInsider trading or sharing insider informationwith third parties can have severeconsequences. Whoever is found in breachof the legislation in respect to insider tradingand sharing insider information with thirdparties, can be condemned to payment ofthe amount of profit gained or of the lossavoided, payment of the amount of the losssuffered by the person who has purchasedthe securities or to whom the securities havebeen sold, or payment of a civilcompensation or a criminal fine, or toa prison sentence. The Company and/orthose responsible for the person who hasbeen found in breach can also becondemned to pay a civil compensation ora criminal fine.

Disciplinary sanctionsIn the event of breach of the Insiders’ policyby a Business Manager, an employee ora family member, a disciplinary sanction canbe imposed on the Executive Manager or theemployee. This sanction can even bedismissal for gross negligence.

Notification of breachesInsiders who have knowledge of a breach ofpolicy stipulations or of the legislationconcerning insider trading or sharing insiderinformation by another Insider mustimmediately inform the Compliance Officerabout this. The Compliance Officer whoknows about the breach decides togetherwith the legal advisor of the Companywhether the Company should publish theinsider information and whether theCompany should notify the competentauthorities of the breach.

Disclosure obligation for persons withmanagerial responsibilities and personsclosely related to themArticle 19, section 1 MAR foresees from3 July 2016 the obligation for "persons withmanagerial responsibilities" and "personsclosely related" to them (hereinafter "Partieswith a Disclosure Obligation") to report to theCompany and to the FSMA (FinancialServices and Markets Authority) thetransactions that they perform for their ownaccount in shares or debt instruments of theCompany, derivatives or other financialinstruments connected thereto, without delayand no later than 3 working days after thedate of the transaction.

A "person with managerial responsibilities" isa person who:

a)is a member of a management orsupervisory body;

b)has a managerial position but is not part ofthe bodies referred to under a) and who hasregular access to insider information relatingdirectly or indirectly to the Company, andwho also has the power to take managementdecisions affecting the future developmentsand business prospects of the Company.



By "persons closely related" to them must beunderstood:

a)the spouse of the person with managerialresponsibilities, or any partner of that personwho is legally regarded as equivalent toa spouse;

b)children who are legal dependants of theperson with managerial responsibilities;

c)other relatives of the person withmanagerial responsibilities who on the dateof the transaction in question shared thesame household as the person concerned forat least the last year;

d)a legal entity, trust or partnership whosemanagerial responsibilities are discharged bya person referred to in a), b) and c) above,which is directly or indirectly controlled bysuch a person, established in favour of sucha person, or whose economic interests aresubstantially equivalent to those of sucha person.

Parties with a Disclosure Obligation shallreport their transactions to the Company andthe FSMA through the online reportingapplication developed by the FSMA.

The disclosure obligation intended In article19, section 1 MAR applies when the totalamount of the transactions reachesa threshold of € 5,000 within a calendar year.

The notification intended in article 19, section1 MAR must contain the followinginformation:

The name and contact details of theperson with managerial responsibility or,where applicable, the name of the personclosely related to this person;

•

Reason for notification;•

Name of the relevant issuer (WereldhaveBelgium Comm. VA);

•

Description and characteristics of thefinancial instrument;

•

Nature of the transaction(s) (e.g.acquisition or disposal) and indicatingwhether the transaction is related to theexercise of a stock option programme orto the specific examples cited in article 19,section 7 MAR;

•

Date and location of the transaction(s);and,

•

Price and size of the transaction(s). In thecase of a transaction involving financialinstruments as collateral and a potentialchange in value is foreseen, this fact mustbe reported, together with the value of thefinancial instruments on the date they areprovided as collateral.

•

Notwithstanding article 19, section 3, firstand second paragraphs MAR, the reportedtransactions are published by the FSMA on itswebsite instead of by the Company.

The Company shall notify the persons withmanagerial responsibilities at the Companyin writing of their responsibilities underarticle 19 MAR. The Company shall draw upa list of all persons with managerialresponsibilities and persons closely relatedto them. The persons with managerialresponsibilities in turn shall notify the personsclosely related to them in writing of theirresponsibilities under article 19 MAR andretain a copy of this notification.



Lists of persons with insider informationIn application of article 18, section 1 MAR,the Company shall draw up lists of personshaving access to insider information andwho, on the basis of an employment contract,work or perform other tasks in which theyhave access to insider information, such asconsultants, auditors and rating agencies (thelist of insiders), on the basis of the standardforms drawn up by the FSMA, and shallcontinually update this list of insiders inaccordance with that which is stipulated inarticle 18, section 4 MAR.

The aforementioned lists must be kept forfive years and may be requested by theFSMA. The Company shall take all reasonablesteps to ensure that the persons appearingon the list of insiders declare in writing thatthey are aware of their legal obligations andof the penalties that apply to insider tradingand unlawful communication of insiderinformation.

Disclosure of insider informationIn application of article 17, section 1 MAR,the Company shall make the insiderinformation that directly relates to thecompany public as soon as possible.

However, in accordance with article 17,section 4 MAR, the Company may, at its ownresponsibility, delay the public disclosure ofinsider information, provided that each of thefollowing conditions are met:

Immediate disclosure would likely harm itslegitimate interests,

•

It is unlikely that the public would bemisled by this delay,

•

The Company is able to ensure theconfidentiality of the information inquestion.

•


Genk Stadsplein


In the event that the Company would decideto delay the disclosure of insider information,it shall inform the FSMA immediately after theinformation has been made public andexplain in writing how the conditions for thedelay were met.

QuestionsAll questions regarding policy stipulationsand its procedures should be addressed tothe Compliance Officer.



SUSTAINABILITYGENERALSince 2013, Wereldhave Belgium has beenactively monitoring and communicating withregard to the sustainability of the portfolio,raising awareness within the company, andinvolvement with its stakeholders.

In view of the increasing importance andattention that Wereldhave is giving tosustainability, last year was the first time theCSR report was included in the annual report.

A distinction needs to be made between theWereldhave group and Wereldhave Belgium.Wereldhave Belgium follows its ownobjectives and meets these through its realestate portfolio.

The general objectives and state of affairs for2016 are shown in the following diagram:

KPI’S2016

PILLAR TARGET YEAR-END STATUS BEBRICKS Improve energy efficiency with 30% 2020 on track

Health & Safety Assessments for all shopping centres 2017 on trackBREEAM ‘Very Good’ shopping centres 2020 44%

PEOPLE Employee satisfaction scores of 7,5 or higher 2017 100%Increase average training to 25 hours pp 2017 on trackIncrease % female senior managers to 33% 2016 20%

PARTNERS Create 1,000 permanent retail jobs (WH) 2017 on track75% of new leases considered to be ‘green’ 2015 89%Sustainable sourcing for all new suppliers 2016 94%

SOCIETY Improve retail customer satisfaction to ‘Good' 2016 100%Invest 1% of NRI 2016 100%95% of WH staff involved 2016 72%

GROUP Maintain GRESB Green Star 2016 100%Maintain inclusion in DJSI Europe Index 2016 100%Maintain EPRA Gold Award sBPR 2016 100%



Since at the end of 2016 certain objectiveswere terminated or some objectives hadalready been achieved or had becomestandard practice, the objectives will besupplemented and strengthened for 2017.Where a few years ago we were moreconcerned with the big picture, we now seethat we can go into more detail withpersonnel as well as with stakeholders.

A materiality matrix was also established forthe Company that reflects the priorities of thestakeholders. This matrix will be reviewedand evaluated annually. Some points arealready well implemented and require lessattention and thus are lower in the chart,while other items that perhaps did not exist atthe beginning of the report are now givena higher priority.

MATERIALITY MATRIX 2016

Figure: Materiality Matrix 2016



STAKEHOLDERS

1 Customers All visitors Satisfaction surveys

SC websites

Social media

Events

Customer journey

Communication

Health & safety

Footfall

Keep in touch with customer

base

Input for improvement

Input for events

2 Retailers All tenants (key) account management

Retailer seminars

Tenant satisfaction surveys

Tenant associations

Sustainability committees

Energy, Water & Waste

Health & safety

Green leases

BREEAM in-use

Customer satisfaction

Footfall

Mutual partnership

Turnover

Sustainability goals

3 Investors Equity & debt providers

Advisors

Assurance firms

AGM

Annual report

Interim statements and trading

updates

One-to-one meetings

EPRA

Real estate seminars

Strategy

Financing requirements

Loans

Governance

Remuneration

Reporting

Stability

Transparency

Guidance

4 Employees All employees

New recruits

Representative bodies

News letters

Result presentations

Onboarding

Career development

Works council meetings

intranet

Culture

Remuneration

Ethics and compliance

Role clarity

Health & safety

Inspired employees

Committed and engaged

Think retail

5 Suppliers All suppliers Supplier dialogue

Charter

Procurement

Review of policy

Health & safety

BREEAM in-use

Ethics and integrity

Sustainable value chain

management

Partnerships

Reliability

Transparency

Quality-cost control

6 Local

communities

Catchment area Events

Licenses and permits

Environment

City competitiveness

Attractive social environment

Health & safety

Planning and regulations

Job creation

Attractive sustainable

environment

Stronger community networks

Long term relationship

Figure: List stakeholders



THE 4 PILLARS OF SUSTAINABILITYOur Sustainability Framework consists of fourpillars. These pillars are the basis of our CSRstrategy. Each pillar contains a strategicapproach that affects the Wereldhave

portfolio, the organisation, the collaborationwith partners and the contribution to theenvironment.

Figure: The 4 pillars of sustainability



PILLAR 1, BRICKSThe first pillar of Wereldhave Belgium'ssustainability framework is dedicated toreducing the environmental impact of ourbuildings. We are attempting to reduce theimpact on the environment by optimisingenergy efficiency, using sustainable materialsand promoting public transport.

1.Increasing energy efficiency by 30%between 2013 and 2020. Using smartmeters and building managementsystems, Wereldhave is able to monitor itsenergy consumption on a 24/7 basis.2.Health risk and safety assessments forshopping centres in 2018. This is a newobjective that was redefined in 2016 tothe drafting of a health & safetydashboard in 2017: inspections, tests,procedures,... are clearly listed andmonitored.3.BREEAM VERY GOOD for shoppingcentres in 2020. BREEAM certificationprovides a comprehensive assessment ofeach building in order to reduce impacton the environment.

For the period Q4 2015 to Q3 2016,consumption in the shopping centres (like forlike) decreased for electricity, water and gas.The big drop in gas consumption (-16%) isdue to shutting down the heating in thewarmer months (May to October) with no lossof comfort for visitors. The offices recordeda decrease everywhere (between -7% and-29%), except for gas (+5%). This increaseneeds to be investigated further. It is possiblyrelated to configuration errors ormeasurement points that cause a false start ofthe system.

All data is based on absolute figures, mainlyfor the common parts and do not takeaccount of degree days (= a severe winter ora hot summer).

The installation of smart meters wascompleted later than planned. We thereforemust see 2016 rather as a reference year,although we started already in 2013. Thestability of the figures for 2015 and2016 makes this reliable, but it above allgives a better understanding of the centresor offices that are performing slightly betterand those that are performing slightly worse.These best practices are now being analysedin order to exchange them and allow us toplan better in 2017. We are also investigatingfree cooling by opening the skylights at nightduring the summer. An energy plan perobject is recommended and will also be oneof the KPIs in 2017, as will be a water andwaste management plan.

The tenants in some shopping centres havealready been sensitised by a night walk thisyear: equipment or lighting that wasunnecessarily left on was reported. Suchinterventions can take place each year: it isinteresting for our equipment, but is alsoa service and introduction to thesustainability policy of Wereldhave Belgium.

Regarding waste, in total (retail + offices) 37%was recycled and 63% incinerated, witha large amount of the heat released inincineration being reused as energy.



RETAIL PERFORMANCE

Q4-Q3 Q4-Q3 DELTAElectricity kWh 2015 2016 15-16TOTAL absolute 6,384,189.00 7,568,399.56like for like absolute 6,365,813.56 -0.29%

Gas kWh 2015 2016 15-16TOTAL absolute 3,735,786.00 3,723,576.22like for like absolute 3,126,070.22 -16.32%

Water m³ 2015 2016 15-16TOTAL absolute 23,397.20 29,937.80like for like absolute 22,569.80 -3.54%

Waste ton 2015 2016 15-16TOTAL absolute 1,339.01 1,578.00like for like absolute 1,348.32 0.69%

OFFICE PERFORMANCE

Q4-Q3 Q4-Q3 DELTAElectricity kWh 2015 2016 15-16TOTAL absolute 7,401,634.77 6,916,443.00like for like absolute -6.56%

Gas kWh 2015 2016 15-16TOTAL absolute 5,256,845.00 5,536,024.00like for like absolute 5.31%

Water m³ 2015 2016 15-16TOTAL absolute 28,641.00 20,384.00like for like absolute -28.83%

Waste ton 2015 2016 15-16TOTAL absolute 235.71 192.22like for like absolute -18.45%



The existing retail portfolio will be assessedusing the BREEAM In-Use tool with the aim ofachieving a Very Good certification in thearea of building and management: Nivellesand Kortrijk were started in 2016, and bothresults were very good: Very Good wasachieved for buildings and even an Excellentfor management. The challenge for 2017 is tobring all the shopping centres to the samemanagement level and to standardiseprocedures.

This was the first time that WereldhaveBelgium had an In-Use assessmentperformed. This was in the context of a largeportfolio approach across the entireWereldhave group, as well as a BRE pilotproject with guidance and assessment byBopro.

Ghent Overpoort and Genk 'Shopping 1'already obtained their BREEAM ConstructionVery Good certificate in 2015.

For the expansion and (re)developments inLiege and Tournai, the BREEAM Design/Construction process is also being followedwith the same minimum target: a Very Goodcertificate.

On 31 December 2016, 44% of our Belgianretail portfolio (4/9) had been certified. SinceWaterloo still needs to be redeveloped andthe Genk City Square is an existing gallery,they can be removed from the scope, inwhich case 4/7 (57%) has been certified.

Where possible local energy production wasused. Thus solar panels were installed inNivelles in 2012, followed in 2014 by Liegeand Ghent. All provisions have been made inthe expansions to easily allow the connectionof new solar panels.

Other actions taken in 2016:•LED lighting in the parking areas of theoffices in Berchem•LED lighting in the parking areas of theoffices in Vilvoorde, Medialaan.•Outdoor seating in Vilvoorde, Medialaan•Start-up of Building ManagementSystem, Sauter, for the offices•Energy assessment for the offices•LED lighting in the parking area ofShopping Nivelles•Intensive actions (in the context of theBREEAM assessment) for ShoppingNivelles and Ring Shopping KortrijkNoord: adding or calibrating water-savebuttons on the toilets, adding motiondetectors, night walks, improved ecologyat the sites, communication with tenantsand visitors ... We will continue to identify,analyse and address energy consumptionin 2017.



Figure: BREEAM In-Use certificate Ring Shopping Kortrijk Noord

Figure: BREEAM In-Use certificate Shopping Nivelles



BREEAM ASSESSMENT

BREEAM (Building Research Establishment Environmental Assessment Method) is anobjective and widely spread assessment tool to evaluate the sustainable performance of abuilding. Wereldhave Belgium uses 3 specific BRE assessments methods:

1) Design, it is the start phase of a new concept and gives tools to develop an idea in asustainable way.

2) New Construction, follows the Design phase and can evaluate the actual new erectedbuilding.

3) In-Use, when an asset is already a longer time part of the portfolio, you can assess itsperformance on Asset Level and Building Management.

Wereldhave Belgium decided not to include Occupier Management as we cannot controlindividual use.

This evaluation gives insight in our different activities, and gives opportunities to improve oncertain levels and share best practices within the Wereldhave Belgium portfolio, so we willhave profound and durable procedures to operate and to facilitate future assessments.



Picture: Nightwalk in Kortrijk Picture: Insects hotel in Njvelles

AIR BEE ’n BEE

One of the sustainable development goals of the United Nations is Biodiversity, this topic is also embedded inthe BREEAM certification in Land Use and Ecology. Our centres can contribute to the bigger environment by aclever green setup and conscious maintenance, but also by delivering habitats to support existing species.

After a survey and analysis by our ecologist, immediate action was undertaken to create a “bee hotel”. In ourregions there are about 350 species of wild bees, approximately 60 of them will inhabit the hotel. Bees are veryimportant and one of the first actors in our food chain, they provide pollination for many of our fruit andvegetable crops. As they live solely, they do not harm, so perfectly safe to install.

Wereldhave Belgium asked the local nonprofit organization Natuurpunt to work together and create awarenessworkshops in Nivelles and Kortrijk. First an inspiring presentation was given (what is a bee, difference between asolitary bee and a honey bee,…), followed by filling boxes with bamboo and wood, at the end the boxes wereplaced inside the bigger frame and the so called “Air Bee-n-Bee” was ready to open for our small guests. Lateron bird and/or bat boxes will follow, together with some small reshaping of the landscape.



PILLAR 2, PEOPLEThe second pillar is aimed at furtherdevelopment of the staff. WereldhaveBelgium wishes to be a good employer forpeople who wish to invest in themselves,their work and their company.

Satisfaction rates in questionnaires amongthe staff of 7.5 or higher in 2017;

1)

Increase in the average number of hoursof training to 25 h./employee;

2)

Increase in the percentage of femaleSenior Managers to 33% in 2016.

3)

The second survey was conducted in thesummer of 2016. Response was large, withparticipation of 79.2%. The survey focused on'Satisfaction' with a score of 7.8.'Engagement' scored 7.8, 'Retention' 7.7,'Job clarity' 6.8, 'Efficiency' 6.9 and'Leadership', 7.1. The first steps forimprovement were taken in late Decemberwith the request to set up a working group.The action plan will take further shape in2017.

In 2016, the target with respect to trainingwas abandoned since the number of traininghours did not correspond at all to the needsof each position. Meanwhile, a search isbeing conducted for a more suitable way toallow people to grow in their job. TheCompany did still organise sustainability roadshows in various shopping centres, assetmanager days for sharing best practices inthe shopping centres, as well as Sharepointtraining in view of the organisationaltransition.



Picture: Immorun © Immorun

Wereldhave Belgium participates in IMMORUN

Even before firing the starting gun, the Immorun was already a success. With 5 teams we exceeded all previousyears, we even went International with Team Schiphol.

The setup is easy: each team consists of 3 runners and every lap a runner joins, at the end the first runner hassweat out 9km, the second one has suffered for 6km and the last one has done 3km. A nice bio buffet was wellappreciated afterwards and with the participation fee a small amount was donated to Local SolutionsDevelopment Group.

This Immorun took place in the middle of the Mobility Week, besides biking to work or even taking stairs (asustainability side project), these athletes took it to the next level!



PILLAR 3, PARTNERSThis refers to relationships with stakeholdersaimed at achieving our sustainableobjectives.

1.Creating new permanent jobs in theretail sector when making newinvestments;2.75% of new rental contracts are inconformance with the ‘Green Lease’ in2016. The ‘Green Lease’ clauses concernworking conditions, materials, energyconsumption, etc.; in this way, tenant andlessor attempt to decrease theirecological footprint;3.Redefining and implementinga sustainable purchasing policy for all newsuppliers in 2016.

In February 2016, the retail park 'LesBastions' in Tournai was opened, with 8 newshops (including AS Adventure, Brico,Maisons du Monde ...). 81 jobs were created.Since 2014, 301 new jobs have been addedby expansions and renovations.

The green lease was approved in 2014 andhas since been properly implemented.Nearly 90% of new and renewed contractswere signed with this annex. This was also anagenda item at the General Meeting in 2016:consumption was discussed as well as thevarious sustainability campaigns. Here we seefurther room for improvement. Tenants afterall differ, and for some sustainabilityprinciples are new, while others have beenaware of this for some time based on theirown history or a parent company. Thechallenge is to exchange good practices, tocontinue to communicate and to involvetenants in the campaigns that the Companyorganises or that we can implement together.

Local teams were also deployed to the greenlease to work on 1 of these points: a contestfor the best sustainable initiative waslaunched in 2015 and was completed in2016. This contest concerned the entiregroup. In the end, the jury selected Genk'Shopping1' with its campaign ‘Bike to Work/Shopping’.

A sustainability charter was drawn uptogether with an external consultant (Bopro),a kind of manual for correct and sustainablebehaviour, that was implemented mid-2015.Several suppliers were interviewed inadvance about their findings (maintenance,technical maintenance, safety, waste). In2016, in addition to Operations contracts,Development contracts and others were alsoadded: in short, all contracts that result insustainable partnerships. 17 contracts wereconsidered in 2016, of which 16 signed thecharter.



Shopping Centre Sustainability award

Summer 2015 we launched the Shopping Centre Sustainability Award. Idea was to promote awareness in theShopping Centres: All Shopping centre teams were asked to create a green project, which relates the GreenLease with their daily live. The Green lease is about lowering our ecological footprint together with our tenantsby raising awareness, improve equipment and daily routines, together with a proper communication. At the end,the participating teams sent in a movie explaining what they had done.

Participants:

Finland: Green Office

Finland: Waste Management

Netherlands: Solar Panels

BE Liège: Textile recuperation

BE Nivelles: Rainwater recuperation

BE Genk: Bike to work/shopping

BE Kortrijk: Electrical charging points

In October Shopping 1 from Genk was chosen as the winner. They promoted bike usage to their shoppingcenter. In first case for tenants (leading by example), but also possible for visitors. The jury appreciated the well-structured movie which also showed the involvement of tenants and visitors, and the engagement of the localteam. This award represents a budget of € 5.000 to invest in a new or existing sustainability project. Team Genklistened to their users and will install electrical charging points and will promote bike usage with a bigger event,exploring also partnerships with the city and its office of tourism.Besides this Award, the jury also saw potential inFinland’s Green Office, a best practice for all local offices.

Cyclo-urban delivery project at Belle-Ile

Fullpacked, a package too heavy or too large? In November, Belle-Ile proposed to its customers the free bicycletransportation of their purchases, with the collaboration of the company "Rayon 9".

By contacting the Info-Ticket, customers were able to pack their goods in a special box. Any parcel broughtbefore noon was delivered the same afternoon, others were delivered the following morning. "Rayon 9" hasrecently provided a bicycle delivery service. Their local project, with a social and solidarity focus, stems from thecurrent saturation of the road network and the traditional job market. This young company aims to reduce thenuisance of the traffic while proposing a rewarding job, in an innovative sector, to young people with a low levelof training.At the moment this service still needs some time to be discovered by the customers. A majority comesby car, but for those who come by bus or bike it might be an interesting option to be explored. The project willbe further tested, improved, analyzed and evaluated in 2017.



PILLAR 4, SOCIETYThis pillar focuses on the social responsibilitywithin the catchment area of the shoppingcentre. We wish to improve social integrationand play a meaningful role in the localcommunity.

Improving client satisfaction to GOOD.The aim is to score 7.5 (out of 10) orhigher. A positive client experienceimproves the number of visitors and thetime spent at the shopping centre,resulting in more purchases andincreased turnover;

1)

Investing 1% of the net rental income insocial initiatives with a link to the localcommunity;

2)

Involving 95% of the staff in a socialintegration event in 2016.

3)

Visitors to Nivelles, Liege, Genk and Tournaiwere interviewed in the course of 2015. Anaverage of 81.5% was achieved. The resultswere analysed and points for improvementfor 2016 included in the specific businessplans for each centre. This survey isconducted every two years.

In 2016, a tenant survey was conducted forthe first time in the shopping centres.Feedback was good, but the process can beimproved by performing this researchinternally and testing the sensitivities of thetenant ourselves. In addition, the positioningof the centres was further analysed withsurveys in other cities in order to further fleshout the action plan for tenants as well asvisitors. This action plan will follow in 2017.

A total of 106 social campaigns were held inthe various shopping centres (including theRed Cross, Oxfam book collection, pop-uptea room by a social employment site, toycollection, other support for charities,…).During the year, an administrative valuationwas made of the areas made available: anestimated rental value/m² for a given period.Other initiatives were expensed. A 1.05% NRIwas obtained for 2016.

Personnel involvement was given form thisyear in various workshops. Thus everyonewas given the choice and time to participate,subject to his or her possibilities. In additionto visiting waste management company VanGansewinkel (external), a workshop was heldin Belle-Ile on the honeybees and the solarpanels located on the roof. Insect hotels havebeen built in Kortrijk and Nivelles incollaboration with Natuurpunt. All of theseworkshops find their context in a betterunderstanding of and specific campaignsrelated to sustainability at the sites.31 employees (approximately 72%)participated.



Ring Shopping Kortrijk Noord: XL VendingMachines for charity (12-31 December2016)

Supporting a good cause in an amusingway: a giant vending machine packed withcandy, gadgets, coupons and gift cards.

Customers deposited one euro, turned thehandle firmly, and received a nice surprisein the form of a ball. Ring Shoppingdonated all of the proceeds to Kloen, aRoeselare-based organisation dedicatedto children with rheumatism, children withcystic fibrosis and hospital clowns.

€ 1,528 was raised, all for Kloen vzw.

Customers could pick up their gadget, giftor coupon at the participating shop. Theparticipation of retailers creates addedvalue for the campaign and bringsadditional visitors to their shops.

‘Les Bastions’ Retail Park: Planting of 100trees.

This campaign is running in parallel withthe objective of Tournai to plant 1 tree perinhabitant by 2020. The 100 trees thatwere planted at the retail park were thefirst for Tournai. More of course will followwith the expansion of the shopping centre.



‘Shopping 1’in Genk: KSO uit de kast (9 November 2016)

Pupils in artistic secondary education (KSO) surprised on 9 November in seven Flemish cities (including Genk)and in Brussels with striking performances and actions. Purpose of " KSO uit de kast " is to make the art educationbetter known to the general public. Genk ‘Shopping 1 'was during one day the studio of art education, wherevisitors were invited to participate in artistic activities: live drawing / painting, window tableau, art, photo andvideo reports, live statues, movement improvisation, a quiz, a contest .

During this action, all the shopping was used and animated. There were more visitors who enthusiasticallyparticipated in the activities.



‘Belle-Ile’ in Liège: K-dolls exhibition (15-23 January 2016)

"Kiwanis Dolls" is an exhibition project of Kiwanis service organization with twenty giant images and some smallstatues. The origin of this project lies with a small doll that helps children in a hospital.

The idea of the 'K-Dolls in the city’ is creating an artistic action around the doll and raise awareness about theaction: Giant puppets are painted by artists and then exhibited in Belgium and Luxembourg. Belle-Ile was one ofthe first places of the expo. Besides an auction smaller craft activities were also held for the children. A fruitfulcollaboration!



MANAGEMENTREPORT

5


MISSION AND STRATEGYMISSION: FOCUS ON SHOPPING CENTRESWereldhave Belgium wishes to bea professional property investor and lessorthat focuses on investments and orexpansions in shopping centres. In that way,Wereldhave Belgium offers an attractive andstructural investment yield for a low riskprofile of its total real estate portfolio. Thefocus on shopping centres that the Companyhas chosen implies a higher concentrationgeographically as well as a higherconcentration of the risk of technical issuesand fire.

STRATEGY: VALUE CREATION AND RISKSPREADING

Wereldhave Belgium pursues a stable growthof the direct result and of the dividend. Thatis exactly the reason why value creation andrisk spreading are central. Investment risksare spread over various regions in Belgium.Value is created for investors by means of:

rent growth thanks to active managementof shopping centres;

1)

development (and redevelopment) ofshopping centres for the Company’sportfolio.

2)

Active management of shopping centresWereldhave Belgium invests in shoppingcentres that set the tone in their catchmentarea. Via active management and internalknow-how, the RREC strengthens its centres’market position, aimed at an increase in thevisitor numbers, shop turnovers and rentalincomes. The RREC also invests in theattractiveness, quality and sustainability of itsshopping centres. Due to high occupancy,they contribute to the permanence of theresult.

In-house developmentDeveloping high-quality property for theCompany’s portfolio on an at-cost basis is the

second pillar of value creation. Bycompleting projects under its ownmanagement, the RREC optimally tunesquality to user requirements and plans thetiming of the investment according to themarket situation.

PROPERTY MANAGEMENT – MANAGEMENT OFTHE INVESTMENT PROPERTIES’ PORTFOLIO

Wereldhave Belgium Services NV, with itsregistered offices at 1800 Vilvoorde,Medialaan 30 box 6, with companyregistration number 0422.120.838, acts asthe real estate manager of the RREC’sinvestment properties’ portfolio.

99.52% of the shares of Wereldhave BelgiumServices are held by the Company. The feespaid to Wereldhave Belgium Services arecharged directly to the tenants in accordancewith the contractual conditions described inthe rental agreements.

Wereldhave Belgium Services has anadministrative, accounting, financial andtechnical organisation that is appropriate formanagement of the real estate portfolio ofthe Company.

The directors of Wereldhave BelgiumServices have the required professionalreliability, accreditation (BIV) and suitableexperience as described in and inaccordance with article 19 of the RREC law.

Even though the Belgian property market hasits own local knowledge and practices, thereis much room for exchange of ‘best practices’in markets where the Wereldhave Group isactive.

5MANAGEMENT REPORT


Against the background of an economicclimate that is set to remain difficult forEurope for the coming period, it is moreimportant than ever to provide input forbusiness choices from operationalexcellence.

In order to boost this operational excellence,efficient data management is being workedon. The organisation has a BO-BI frameworkfor operational purposes. Data must beprovided from the same sources and streamsand therefore business processes must beharmonised optimally.

5 MANAGEMENT REPORT


IMPORTANT DEVELOPMENTSSHOPPING CENTRESWereldhave Belgium focuses on conveniencecentres that are dominant in their catchmentarea and has a preference for sites with thepotential for future expansion. Via a proactiveapproach, the GVV strives to maintain andstrengthen the market position of itsshopping centres. The importance ofshopping centres rose this year to ca. 85% ofthe property investment portfolios.

In the shopping centres, 47 commercialleases were concluded during 2016 (11 newcontracts and 36 lease renewals).

The retail park, adjoining the ‘Les Bastions’shopping centre in Tournai, has beenoperational since 19 February 2016 and is97% let.

Wereldhave Belgium is constantly looking toexpand the portfolio through acquisitionsand new property developments.

OCCUPANCYThe EPRA occupancy rate – see above – of theshopping centres is 95.9% (31 December2015: 94.9%). The like-for-like rental growthof the core portfolio of property investments(shopping centres) is 4.9% (2015: 1.8%)(including an average indexation of 2.09%).The shopping centres in Nivelles, ‘LesBastions’ in Tournai and ‘Belle-Île’ in Liègeare almost fully let. The occupancy rate of theshopping centre ‘Ring Shopping KortrijkNoord’ and Genk ‘Shopping 1’ was 93.4%and 81.9% respectively.

DEVELOPMENT PROJECTSAs at 31 December 2016, the fair value of thedevelopment projects portfolio was€ 35.3 mln (31 December 2015: € 40.5 mln).

The net decrease of € 5.2 mnl is, on balance,attributable to the following factors:

The transfer (reclassification) of the retailpark (10,000 m²) adjacent to the shoppingcentre ‘Les Bastions’ in Tournai fromdevelopment projects to operationalinvestment properties (€ - 17.0 mln);

•

The investments (€ 16.2 mln) mainlyconcern the structures needed to developthe € 14.2 mln expansion of the ‘LesBastions’ shopping centre in Tournai by15,000 m². This development is going toplan and, by now, the marketing thereof isin full swing. Delivery of the building isscheduled for Q2 2018. The initial costs(€ 1.3 mln) relating to a possibleexpansion (8,000 m² in GLA (GrossLettable Area)) of the ‘Belle-Ile’ shoppingcentre in Liège are, in particular, the studyand design costs. Planning permissionand environmental permit have beengranted and are final. The marketing ofthis project has started;

•

The inner-city development project‘Coeur de Ville’ in Waterloo (10,000 m²GLA) is part of a master plan which,currently, is filed with the local authorityfor re-assessment, but with no consensusthus far. In that light, it’s difficult for theManagement Company to estimate whenthey will be able to finalize this project.Due to these changed circumstances,a downward value adjustment wasdeemed appropriate and the fair valuewas set at € 1.9 mln, i.e. the value of thelandholding and the estimated value ofthe permits. This value was confirmed bythe independent property valuer. TheManagement Company holds that theother start-up costs (€ -4.4 mln) should berevalued downward and it will closelymonitor the concrete evolutions anddecisions of the local authority.

•

5MANAGEMENT REPORT


DEVELOPMENT PROJECTS – TIMELINE

PROJECT (RE)DEVELOPMENT DESCRIPTION

2015 2016 2017 2018 2019‘Les Bastions’ TournaiExtension

Investment € 65.8m.Expected return6.25 – 6.75%

‘Belle-Ile’ LiègeExtension

Investment € 50m.Expected return6.0 – 6.5%

WaterlooRedevelopmentof the downtown mall

Investment € 52m.Expected return6.75% -7.25%

OFFICESThe EPRA occupancy evolved from 93.4% asper 31 December 2015 to 90.9% as per31 December 2016. An area ofapproximately 1,200 sqm is vacant in thebuilding located on Medialaan 28 inVilvoorde.

The Management Company makes everyeffort to reduce the vacancy rate.Consolidation of the current occupancy andrenegotiation of the lease contracts on thedue date remain the priority.

REAL ESTATE CERTIFICATESThe participation held in the listed real estatecertificates ‘Basilix’ and ‘Ring ShoppingKortrijk Noord’ are in the liquidation phase.

The liquidation coupon on the limitedundistributed amount were included in tradereceivables, therefore this will have no moreimpact on the results of the company.

5 MANAGEMENT REPORT


FINANCIAL RESULTSNET RESULT FROM CORE ACTIVITIESIn 2016 Wereldhave Belgium posted a netresult from core activities of € 40.1 mln (2015:€ 39.1 mln). The net rental income increasedby € 2.3 mln, mainly due to the retail park inTournai that became operational (€ 0.7 mln),additional rental income (€ 0.9 mln) relatedto paid parking in the shopping centre ‘GenkShopping I’ and several higher rental incomefrom, a.o. temporary leases, pop-ups, andrent adjustments (€ 0.7 mln).

Property charges decreased slightly with€ 0.7 mln; general costs and other operatingincome and charges are € 1.8 mln higher,mainly due to a lower capitalization of feescharged to development projects.

Operational financial expenses decreased by€ 0.5 mln thanks to lower nominal interestrates.

The real estate certificate ‘Basilix’ wasliquidated in 2015 and this had a one-offpositive impact on the results of2015 (€ 0.6 mln).

The net result from core activities per shareamounts to € 5.78 (2015: € 5.63).

NET RESULT FROM NON-CORE ACTIVITIESThe net result from non-core activitiesamounts to € 26.2 mln (2015: € 10.3 mln).The net result from non-core activities arisesmainly from realised and unrealised changesin the value of assets in the portfolio(€ 26.3 mln) and other result on portfolio(€ -0.1 mln).

EQUITY AND DEBTOn 31 December 2016 the shareholders’equity amounts to € 599.6 mln (31 December2015: € 567.3 mln). The net asset value pershare, including the profit for the currentyear, amounts to € 86.41 (31 December2015: € 81.76).

In 2016, the average interest rate on theoutstanding loans amounts to 0.99%(average interest rate 2015: 1.19%).

Wereldhave Belgium’s guideline for thelonger term is a solvency ratio of about 70%.At 31 December 2016, the Company relieson external and ‘intracompany’ funding; thelong-term loans were concluded in the formof ‘revolving credits’ respectively, maturing in2017 (€ 30 mln), in 2018 (€ 30 mln), in2019 (€ 214.5 mln), in 2021 (€ 130 mln) anda non-committed credit line (€ 26 mln) withno maturity date. The amount of unusedcredit lines was € 128.5 mln at 31 December2016.

Calls are at a variable interest rate and arestated at fair value. These are only creditfacilities for which no security has beenprovided. The fair value does not significantlydiffer from the nominal value since it is aboutshort-term advances to a variable interestrate.

The Company concluded an interest rateswap (IRS) where the variable rate wasconverted into a fixed rate until the maturitydate of the credit facility (1st April2019 – € 50 mln).

Due to the solid balance sheet, the sensitivityto changes in interest rates is limited and thedynamism of the Company increases whenmaking new investments.

In accordance with the calculation methodprescribed by the Royal Decree of 13 July2014, the debt ratio on the total assets at31 December 2016 is 27.6% (2015: 27.5%).

5MANAGEMENT REPORT


The average interest rate on outstandingloans in 2016 amounted to 0.99% (average2015: 1.19%).

5 MANAGEMENT REPORT


EVENTS HAVING OCCURRED AFTER THE END OF THE FINANCIAL YEARNo significant events occurred after31 December 2016 that could be of influence

to the present financial report or that shouldbe mentioned in it.

RESEARCH AND DEVELOPMENTDue to the nature and specific activities of thecompany, there are no activities that relate toresearch or development.

5MANAGEMENT REPORT

Belle-Île


ALLOCATION OF THE PROFITPROFITEarnings 2016, including net result from coreand non-core activities, are € 66.2m (2015:€ 49.4 mln). Compared to 2015, this increaseis due to a higher net result from coreactivities (€ 1.0 mln) and a higher net resultfrom non-core activities (€ 15.8 mln).

Based on a payout ratio of 88% of theoperating income, shareholders will beproposed with a gross dividend of € 5.10 pershare for 2016. After deduction of thewithholding tax of 30%*, this results in a netdividend of € 3.57.

As 6,939,017 shares are participating in theresult of 2016, the distributable dividend is€ 35.4 mln.

A payment of 88% of the operatingdistributable result is in accordance withArticle 45, 2 ° of the RREC-Law and Article13 of the RREC-KB which requires a minimumpayment of 80% of the operating result.

DIVIDENDAt the general meeting of shareholdersa gross dividend (coupon 21) of € 5.10 gross– € 3.57 net (2015: € 4.90 gross – € 3.577 net)per share will be proposed. The dividend ispayable as from 20 April 2017. Financialservices are provided by BNP Paribas Fortis.

(*) Decreed dividends payable after 1 January 2017 (subject to certain exemptions) are subjected to a withholdingtax of 30% instead of 27% (Program law of 25 December 2016 published in the Belgian Official Gazette of29 December 2016).

5 MANAGEMENT REPORT


PROSPECTSBegin 2017, the leasing team has beenstrengthened to increase occupancy rate andto support the leasing of the expansionproject in Tournai. This project will, however,contribute to the direct result only from 2018.

For 2017 Wereldhave Belgium aims forstable direct result per share. Except forunforeseen circumstances, this objective canbe realised.

The development projects are monitored atclose range and are expected to makea positive contribution to the profit with theiroperational start.

The Management Company of WereldhaveBelgium declares:

that based on the performed assessmentand taking into account therecommendations of the CorporateGovernance Code, the internal riskmanagement and control systems ofWereldhave Belgium are adequate andprovide a reasonable assurance that thefinancial statements included in thisAnnual Report contain no inaccuracies ofmaterial importance. The ManagementCompany has no indication that the riskmanagement and control system wouldnot have functioned in accordance withthe description or that this system wouldnot have functioned properly in thecurrent year;

1)

that the annual accounts provide a trueand fair view of the assets, liabilities,financial position and result ofWereldhave Belgium and the companiesincluded in the consolidation;

2)

that the Annual Report provides a trueand fair view of the situation on thebalance sheet date, the course of businessduring the financial year of WereldhaveBelgium and the affiliated companies, thefigures of which have been included in itsAnnual Accounts;

3)

that the main risks confrontingWereldhave Belgium and its affiliatedcompanies have been described in theAnnual Report; and

4)

that after taking all reasonable measures,the information in this report, to itsknowledge, is in accordance with the factsand contains no omission which couldaffect the scope of the Annual Report.

5)

The Management Comany

NV Wereldhave Belgium

D. Goeminne, Voorzitter

J. de Smet

P. Naert

K. Deforche

D. Anbeek


5MANAGEMENT REPORT


EPRA6


These data are exclusively for information and are notrequired in compliance with the RREC Law nor subjectto any review by public authorities; these figures havenot been audited by the statutory auditor.

EPRA (European Public Real Estate Association) is anorganization that promotes European listed real estatesector, helps develop and represent in order to boostconfidence in the sector and to increase investment inlisted real estate in Europe.

EPRA PERFORMANCE MEASURES

TABLE

EPRAPERFORMANCEMEASURE DEFINITION 2015 2016

1 EPRA Earnings Earnings from operational activitiesObjective: To measure the result of the strategicoperational activities, excluding (i) changes in fairvalue of financial assets and liabilities (ineffectivehedges), and (ii) realized and unrealized gain or losson investment properties.

x € 1,000 39,040 40,128

€/share 5.63 5.782 EPRA NAV Net Asset Value adjusted to include properties and

other investment interests at fair value and to excludecertain items not expected to crystalise in a long-terminvestment property business modelObjective: To provide stakeholders with relevantinformation on the fair value of assets and liabilitieswithin a real estate investment company with a long-term strategy.

x € 1,000 569,773 602,193

€/share 82.11 86.783 EPRA NNNAV EPRA NAV adjusted to include the fair values of (i)

financial instruments, (ii) debt and (iii) deferred taxesObjective: Provides stakeholders with relevantinformation on the fair value of assets and liabilitieswithin a real estate entity.

x € 1,000 567,310 599,586

€/share 81.76 86.414 EPRA Net Initial

Yield (NIY)Annualised rental income based on the cash rentspassing at the balance sheet date, less non-recoverable property operating expenses, divided bythe market value of the property, increased with(estimated) purchasers' costsObjective: a tool to compare real estate portfolios.

5.7% 5.7%

6EPRA


5 EPRA VacancyRate

Estimated Market Rental Value (ERV) of vacant spacedivided by ERV of the whole portfolioObjective: To measure the vacancy of the investmentproperties portfolio based on market rent.

5.4% 4.2%

6 EPRA Cost Ratio(including directvacancy costs)

EPRA costs (including direct vacancy costs) divided bygross rental income, minus the fees for leasehold andbuilding rightsObjective: To measure the relevant general andoperational costs in order to be able to form animage and to make an analysis of the costs of theCompany.

13.5% 15.3%

7 EPRA Cost Ratio(excluding directvacancy costs)

EPRA costs (excluding direct vacancy costs) dividedby the gross rental income, minus the fees forleasehold and building rightsObjective: To measure the relevant general andoperational costs in order to be able to form animage and to make an analysis of the costs of theCompany.

11.6% 13.7%

TABLE 1: EPRA EARNINGS

(X € 1,000)

2015 2016Net result IFRS (group share) 49,391 66,241

Adjustments to calculate EPRA EarningsExclude:I. Changes in value of investment properties -8,743 -26,364II. Profit or losses on disposal of investment properties 0 0III. Other portfolio result 215 251VI. Changes in fair value of financial instruments and associated close-out

costs -1,823 0EPRA Earnings (group share) 39,040 40,128Weighted average number of shares 6,939,017 6,939,017EPRA Earnings per share 5.63 5.78

6 EPRA


TABLE 2 EN 3: EPRA NAV EN EPRA NNNAV

(X € 1,000)

2015 2016Net Asset Value (group share) 567,310 599,586Net Asset Value per share (group share) 81.76 86.41

Exclude:I. Fair value of financial instruments 733 808II. Deferred taxes 1,730 1,799EPRA NAV (group share) 569,773 602,193Number of shares at year end 6,939,017 6,939,017EPRA NAV per share (group share) 82.11 86.78Include:I. I. Fair value of financial instruments -494 -808II. Deferred taxes -1,693 -1,799

EPRA NNNAV (group share) 498,284 599,586Number of shares at year end 6,308,198 6,939,017EPRA NNNAV per share (group share) 81.76 86.41

TABLE 4: EPRA NET INITIAL YIELD (NIY) AND ‘TOPPED-UP’ NIY

(X € 1,000)

2015 2016Investment properties 774,029 819,827Exclude:

Investment properties built or developped in portfolio available forlease -40,547 -35,318Investment properties held for sale 0 -18,699

Properties available for lease 733,482 765,810Include:

Estimated transaction costs resulting from hypothetical disposal ofinvestment properties 76,715 19,159

Investment value of the real estate portfolio available for lease (B) 810,197 784,969

Annualised gross rental income 48,573 47,211Exclude:

Property charges -2,175 -2,189Annualised net rental income (A) 46,398 45,022EPRA NET INITIAL YIELD (A/B) 5.7% 5.7%

6EPRA


TABLE 5: EPRA VACANCY RATE

SEGMENTLETTABLE SPACE

IN M²

ESTIMATED RENTALVALUE (ERV)

OF VACANT SPACESIN € 1,000

ESTIMATEDRENTAL

VALUE (ERV)IN € 1,000

EPRAVACANCY RATE

EPRAVACANCY RATE

2015 2016Offices 78,409 945 10,973 6.60% 7.50%Retail 155,157 2,022 39,414 5.10% 5.40%Investmentpropertiesavailable for lease 233,566 2,967 50,387 0 0

The EPRA vacancy ratio on 31 December 2016 has decreased with 1.2% compared to 31 December 2015 mainly through leases in theshopping centres portfolio.

TABLE 6: EPRA COST RATIOS

(X € 1,000)

2015 2016Overhead expenses 3,075 4,626Write-downs on trade receivables 0 0Fees for building rights and leaseholds 371 382Property charges 3,294 2,618Exclude:

Fees for building rights and leaseholds -371 -382EPRA costs (including vacancy costs) (A) 6,369 7,244Vacancy costs -915 -781EPRA costs (excluding vacancy costs) (B) 5,454 6,463Rental income decreased with fees for building rights and leaseholds (C) 47038 47211EPRA Cost Ratio (including vacancy costs) (A/C) 13.5% 15.3%EPRA Cost Ratio (excluding vacancy costs) (B/C) 11.6% 13.7%

The EPRA Cost Ratio (including vacancy costs) and the EPRA Cost Ratio (excluding vacancy costs) as per 31 December 2016 haveincreased compared to 31 December 2015, mainly due to the increase of general costs (€ 1.5 mln) during 2016.

6 EPRA


Ring Shopping Kortrijk

7


REAL ESTATEREPORT

7


THE BELGIAN REAL ESTATE MARKETINVESTMENT IN RETAIL PROPERTY AT A HIGH LEVELAfter the record year 2015, which was mainly driven bytransactions as Wijnegem Shopping Centre andWaasland Shopping, investment in retail property hasremained at a very high level.

In 2016 too, a major shopping centre, namelyMediacité in Liège, was sold for almost 250 millioneuros. It should be noted, however, that about half ofthe total 1.2 bn euros in investment in retail property isfor the account of high street shops.

Because of historically low interest rates, the primelocations’ yields has continued to compress in recentyears, causing prices to rise. For retail property in lessfavourable locations or in the case of high vacancyrates, this positive trend is more in doubt.

RENTAL LEVELS IN SHOPPING CENTRES STABLE IN 2016In 2016 the lettings market remained active, partly dueto the letting of new shopping centres: ’Docks’ inBrussels and ‘Rive Gauche’ in Charleroi.

One definite trend is that popular shops (‘crowd-pullers’) in shopping centres are trying to capitalise ontheir strong negotiating position by securing rentswhich are contingent on the future turnover of theshop or on other specific benefits or contributions.A property developer is inclined to go along with thisin the interests of the commercial mix of the centre asa whole and the ‘pull’ this will have on smaller retailunits.

On average, market rents have remained stable inrecent years, albeit with marked differencesdepending on how successful the shopping centre is(e.g. if several retails units are unoccupied). Insecondary centres, retailers’ turnovers have been badlyhit, resulting in negative corrections of rental levels.

RECORD LEVELS FOR INVESTMENT IN OFFICESThe office space market was characterized by a veryhigh level of investment volume and featured a fewhighly significant transactions (the Ellipse building,Astro Tower, Tour & Taxis, among others).

Prime location’s yields fell further to an all-time low of4.75%.

LETTINGS MARKET FOR OFFICES REMAINSCHALLENGING, ESPECIALLY IN PERIPHERAL LOCATIONS

The relatively high level of new rental contracts waschiefly driven by the public sector, with severaltransactions by Belgian and EU bodies.

Due to relatively limited speculative newdevelopments and a continuing reconversion of officesinto residential projects, vacancy rates, on average,decreased.

In the peripheral locations however, demand foroffices remained at a low level with, as a consequence,high vacancy rates and pressure on market rents.

Source: inspired, in part, by CBRE Market TrendsBelgium 2016 and C&W Marketbeat Belgium RetailQ4 2016

7REAL ESTATE REPORT


SUMMARY AND OVERVIEW OF THE REAL ESTATE PORTFOLIOSUMMARY OF THE REAL ESTATE PORTFOLIO

SHOPPING CENTRES % OFFICES % TOTAL

(x € 1,000)

Fair value

Real estate investments (excluding projects) 660,480 124,029 784,509

Projects 35,318 35,318

Total real estate investments 695,798 84.86% 124,029 15.14% 819,827

Acquisition value 492,380 77.06% 146,549 22.94% 638,929

Insured value (*) 412,840 76.65% 125,751 23.35% 538,591

Contractual rent 39,615 80.24% 9,754 19.76% 49,369

(*) insured through a General Construction Risk policy

7 REAL ESTATE REPORT


Genk Stadsplein

7REAL ESTATE REPORT


COMPOSITION OF THE REAL ESTATE PORTFOLIO

YEAR OF CONSTRUCTION

OR MOST RECENT

RENOVATION

DIVERSIFICATION OF

THE PORTFOLIO

(IN % OF VALUATION)

LETTABLE AREA

(IN SQM)

Retail

Shopping Centre "Belle-Ile", Quai des Vennes 1, 4020 Liège 1994 22.39% 30,252

Shopping Centre Nivelles, Chausée de Mons 18A, 1400 Nivelles 2012 17.34% 28,600

Shopping Centre "Les Bastions", Boulevard W. de Marvis 22, 7500 Tournai 1996 7.54% 15,540

Retailpark 'les Bastions' in Tournai 2016 2.28% 10,350

Shopping Centre "Shopping I", Rootenstraat 8, 3600 Genk 2014 8.46% 27,100

Shopping Centre "Kortrijk Noord", Ringlaan, 8500 Kortrijk 1973 13.14% 32,000

"Forum Overpoort", Overpoortstraat, 9000 Gent 2014 1.95% 3,700

Genk - Stadsplein, Stadsplein 39, 3600 Genk 2008 5.72% 15,618

Commercial complex Waterloo, Chaussée de Bruxelles 193-195, 1410

Waterloo 1968 1.74% 3,347

80.56% 166,507

Offices

Madou Centre, Bischoffsheimlaan 1-8, 1000 Brussels 2002 2.28% 12.162 / 504*

Businessclass office park, Jan Olieslagerslaan 41-45, 1800 Vilvoorde 1998 0.41% 3.048 / 29*

'Business- & Media' office park, Medialaan 30, 1800 Vilvoorde 1999 1.24% 5.449 / 201*

'Business- & Media' office park, Medialaan 32, 1800 Vilvoorde 1999 0.84% 3.907 / 120*

Business- & Media' office park, Medialaan 28, 1800 Vilvoorde 2001 2.73% 12.772 / 246*

De Veldekens I, Roderveldlaan 1-2, 2600 Berchem 2001 2.20% 11.192 / 368*

De Veldekens II, Roderveldlaan 3-4-5, 2600 Berchem 1999 3.22% 16.003 / 1.008*

De Veldekens III, Berchemstadionstraat 76-78, 2600 Berchem 2002 2.21% 11.192 / 208*

15.13% 78,409

Development in commercial projects

Extension shopping centre 'Les Bastions' in Tournai 2.91%

Redevelopment shopping centre in Waterloo 0.23%

Extension shopping centre 'Belle-Ile' in Liège 0.31%

Nivelles land positions 0.85%

Total development projects 4.30% 0

Total 100% 244,916

archives*Rental value vacancy is the difference between the theoretical rental value of the property and the received rental income.(1)

The theoretical rental value equals the contractual rent increased with the value of rental vacancy.(2)

To determine the estimated rental value, external valuation experts rely on their knowledge of the property market and on recenttransactions. The rental value is influenced by the location of the property, the suitability of the site, the qualities of the building and themarket conditions.

(3)

The occupancy rate is calculated by dividing the (indexed) contractual rental of current leases by the sum of contractual rents andestimated rental value (market rent) of the vacancy. The latter are determined based on the level of the current rents.

(4)

This property is fully owned by NV Immo Guwy and Waterloo Shopping BVBA and are not included in the statutory accounts.(5)



PARKINGS

(NUMBER OF SPACES)

RENTAL INCOME 2016

(€ X 1,000)

RENTAL VALUE VACANCY

(€ X 1,000)

THEORETICAL

RENTAL VALUE 2016

(€ X 1,000)

ESTIMATED RENTAL VALUE

(€ X 1,000)

OCCUPANCY RATE

2016(1) (2) (3) (4)

2,200 11,278 0 11,278 10,927 100.00%

1,452 8,476 28 8,504 7,860 99.60%

1,260 3,569 0 3,569 3,121 100.00%

360 763 28 791 1,127 97.50%

1,250 4,438 964 5,402 5,328 81.90%

2,000 6,153 448 6,601 6,833 93.40%

0 825 60 885 938 93.60%

44 3,286 99 3,385 2,930 96.60%

95 827 0 827 849 100.00%

39,615 1,627 41,242 39,914 95.90%

150 2,639 0 2,639 2,563 100.00%

82 228 95 323 314 69.60%

178 580 255 835 769 66.90%

123 387 186 573 541 65.60%

305 1,284 224 1,508 1,732 87.10%

238 1,427 0 1,427 1,506 100.00%

316 2,123 8 2,131 2,107 99.60%

217 1,086 231 1,317 1,403 83.50%

9,754 1,000 10,754 10,935 90.90%

49,369 2,627 51,996 50,849 95.80%

7REAL ESTATE REPORT


KEY INFORMATION

GEOGRAPHICAL BREAKDOWN(as % of fair value)

2.28%

42.13%

55.59%

BrusselsFlanders

Wallonia

AVERAGE OCCUPANCY

100

80

60

40

20

02012

93.70%

2013

97.00%

2014

94.10%

2015

94.10%

2016

95.80%

(in % of rental income)

GEOGRAPHICAL BREAKDOWN(as % of fair value)

2.28%1.95%

5.22%

7.63%

1.97%18.19%

12.73%

22.70%

14.19%

13.14%

BrusselsGhentVilvoordeBerchem-AntwerpWaterloo

NivellesTournaiLiègeGenkKortrijk



CONTRACTED RENT/MARKET RENT

50,000

40,000

30,000

20,000

10,000

0Contracted rent

39,615

9,754

Market rent

38,999

10,361

(x € 1.000)

Retail Offices

PORTFOLIO REVALUATION

4

3

2

1

0

-12012

1.29%

2013

0.55%

2014

-0.04%

2015

1.13%

2016

3.22%

(in %)

CONTRACT RENT OVER 5 YEARS(TILL FIRST NOTICE POSSIBILITY)

50,000

40,000

30,000

20,000

10,000

02017

46,442

2018

42,575

2019

40,029

2020

36,336

2021

24,922

(x € 1,000)

GUARANTEED RENTAL INCOME

100

80

60

40

20

02017

93%

2018

84%

2019

78%

2020

70%

2021

47%

(in %)

7REAL ESTATE REPORT


BRANCH MIX

AGE ANALYSIS OFTHE REAL ESTATE PORTFOLIO

60

50

40

30

20

10

0 ≥ 5 years

34.34%

> 5 years ≥ 10 years

5.72%

> 10 years≥ 15 years

9.42%

> 15 years

50.52%

(in % of valuation)

BRANCHE MIX INVESTMENT PROPERTYRETAIL(as % of rental income)

41.84%

9.57%

8.53%

2.91%

7.75%8.32% 1.87%2.01%

11.61%

5.59%

Fashion & accessoiriesFoodLeather/shoesDecorationRestaurant & bar

Care and hygieneSportsParkingMultimediaOther

INVESTMENT PROPERTIES > 5%

(in % fair value)

17.34%

22.39%

5.72%

8.46%

7.54%

13.14%

25.41%

Shopping NivellesBelle-Ile LiègeGenk StadspleinGenk Shopping I

Les Bastions TournaiRing Shopping KortrijkOther < 5 %



TOP 10 TENANTS*

Global Portfolio

TENANT SECTION %1 Ergo Services DKV Offices 5.4%2 Carrefour Belgium Retail 3.7%3 Hennes & Mauritz Retail 3.2%4 C&A Retail 3.1%5 Delhaize Group Retail 1.9%6 A.S. Watson Group Retail 1.8%7 Sportsdirect.com Retail 1.6%8 Argenta Spaarbank Offices 1.6%9 Ricoh Offices 1.5%

10 Proximus Offices 1.5%25.3%

Retail

TENANT %

1 Carrefour Belgium 3.7%

2 Hennes & Mauritz 3.2%

3 C&A 3.1%

4 Delhaize Group 1.9%

5 A.S. Watson Group 1.8%

6 Sportsdirect.com 1.6%

7 Redisco 1.4%

8 Blokker 1.4%

9 Excellent Retail Brands 1.3%

10 Hema 1.3%

20.7%

Offices

TENANT %

1 Ergo Services DKV 5.3%

2 Argenta Spaarbank 1.7%

3 Ricoh 1.6%

4 Amadeus Benelux 1.0%

5 Proximus 1.0%

6 ABN Amro Bank 0.9%

7 24+ 0.6%

8 Antea Belgium 0.6%

9 Quintiles Belgium 0.6%

10 WGEO 0.4%

13.7%

* Expressed as a percentage of annualized contractual rent.

7REAL ESTATE REPORT


AVERAGE DURATION OF LEASE AGREEMENTSThe average duration of contractual lease agreementsuntil the first possibility of termination is 3.2 years, andthe average duration until the end of the leasecontracts is 6.4 years.

INSURED VALUE INVESTMENT PROPERTIES PORTFOLIOThe insured value of the portfolio of real estateinvestments is based on an annual external valuation of‘new-build value’ made by a recognised propertyexpert. The insured values are adjusted automaticallyannually according to the applicable index.

In order to avoid multiple claims between owner andtenant, the standard lease agreements stipulate thatinsurance agreements of the underlying property unitsare entered into by the owner-lessor for the rebuildvalue of the property unit, including ‘loss of rent’ fora period of 36 months.

The insurance risk is underwritten by AIG EUROPELimited.

The total insured value of the portfolio of theinvestment properties amounts to € 538.6 mln.

The proportional share of the insured value comparedto the fair value is explained by the high value of theland compared to the construction value, inherent tocommercial real estate.

The insured value represents 53% of the fair value ofthe investment properties portfolio.

The insurance premium for 2016, including taxes,amounts to € 169,669.

OPERATIONAL MANAGEMENTThe Company has an internal managementorganisation that manages the disciplines ofadministrative, technical and commercial managementof property.

Wereldhave Belgium Services NV, subsidiary, has anadministrative, accounting and technical organisationthat is fitting for management of the real estateportfolio of the Company. The directors of WereldhaveBelgium Services have the required professionalreliability, accreditation (BIV) and appropriateexpertise as described and in accordance with Article13 of the RREC Law and suitable experience inaccordance with Article 19 of the RREC Law.

DEROGATION IN ACCORDANCE WITH ARTICLE 30 §3 AND§4 OF THE RREC LAW

On 23 December 2016, the FSMA allowed a renewedderogation on the prohibition of investing more than20% of the assets in one property unit. This derogationhas been allowed against the following cumulativeconditions:

The derogation has been accorded until31 December 2018;

•

The Company reports the share that the shoppingcentre ‘Belle-lle’ represents in the investmentproperties portfolio to the FSMA every quarter;

•

The periodic reports and prospectuses that theCompany will publish in the future must stateexplicitly that the focus on shopping centres thatthe Company has chosen imply a highergeographical concentration as well as a higherconcentration of the risk of, among other things,technical problems and fire.

•

In accordance with article 30 §4 of the RREC Law, thedebt ratio of the Company may not exceed 33% aslong as the derogation on article 30 §1 and §2 of theRREC Law applies. The consolidated debt ratio is27.6% as per 31 December 2016.

The purchase value (contribution value and additionalinvestments when obtaining the status of real estateinvestment trust/public regulated real estate company(1998)) of the shopping centre ‘Belle-lle’ in Liègeamounted to € 75.8 mln. The fair value as per31 December 2016 amounted to € 183.4 mln, which is22.4% of the investment property portfolio. The rentalincomes for 2016 amounted to € 11.3 mln.

COMPLETION OF RETAIL PARK ‘LES BASTIONS’ INTOURNAI

The retail park, adjacent to the shopping centre ‘LesBastions’ in Tournai, was technically completed on18 February 2016. The construction phase wasapproximately 1 year.

The investment cost of this project amounted to€ 17 mln and was financed by uptake of existing creditfacilities. The lettable area amounts to 10,350 sqm.

The structural criteria retained by Wereldhave Belgiumincluded, durable quality products, flexible rentablespace and architectural interaction with the existingshopping centre.

As of 31 December 2016 the occupancy rate was 97%.Major tenants include AS Adventure, Blokker, Maisonde Monde, ZEB and Brico.



COMPLETION OF EXTENSION ‘LES BASTIONS’ IN TOURNAIThe redevelopment of the shopping centre consists ofboth a structural renovation of the existing shoppingcentre and, secondly, an innovative extension withrespect for the environment.

The investment cost of this project amounts to€ 65.8 mln and is funded by uptake of existing creditfacilities.

After renovation and extension (15,000 sqm) the grossleasable area of the shopping center will beapproximately 30,000 sqm.

This development fits into the strategy of the Companyto build a portfolio of convenience shopping centreswhich are dominant in a strong and extensivecatchment area.

The opening is planned for the beginning of 2018.

7REAL ESTATE REPORT


DESCRIPTION OF THE REAL ESTATE PORTFOLIOSHOPPING CENTRES

Shopping centre ‘Belle-Ile’Quai des Vennes 1, 4020 LiègeTop 5 tenants

Carrefour Belgium 10,95%WE 3,87%Hennes & Mauritz 3,56%C&A 3,30%Coolcat 2,19%

Number of tenants: 99Construction: 1994Location: Belle-Ile is located in thesoutheast of Liège, at the start ofthe ‘Autoroute des Ardennes’ – E25Lettable area: 30,252 m2

Shopping centre NivellesChaussée de Mons 18A, 1400 NivellesTop 5 tenants

Delhaize Group 5,46%Hennes & Mauritz 4,75%Sportsdirect.com 3,55%Retail Concept 2,61%DelcambeChaussures

2,37%

Number of tenants: 100Construction: 1974 – Extension:2012Location: The shopping centre ofNivelles is located at the peripheryof Nivelles, exit ‘Nivelles Sud’ ofhighway E19 Lettable area:28,600 m2

Shopping centre Kortrijk NoordRinglaan, 8500 KortrijkTop 5 tenants

C&A 5,39%Hennes & Mauritz 4,69%Albert Heijn 3,52%Hema 3,47%Timmermans 2,97%

Number of tenants: 83Construction: 1973Location: The shopping centre islocated alongside the ring ofKortrijkLettable area: 32,000 m2



Shopping centre ‘Les Bastions’Boulevard Walter de Marvis 22, 7500 TournaiTop 5 tenants

C&A 11,77%Delhaize Group 9,85%Hema 3,81%Ici Paris XL 3,71%La Grande Récré 3,48%

Number of tenants: 59Construction: 1979 – Renovation:1996Location: The shopping centre islocated alongside the ring ofTournaiLettable area: 15,540 m2

Retail Park ‘Les Bastions’Boulevard Walter de Marvis 22, 7500 TournaiTop 5 tenants

Maisons du Monde 17,77%Sportsdirect.com 15,27%Brico 15,15%Harrar 12,17%Retail Concepts 10,10%

Number of tenants: 9Construction: 2016Location: Het Retail Park ‘LesBastions’ is gelegen aan de ring vanTournaiLettable area: 10.350 m2

Shopping centre Genk ‘Shopping 1’Rootenstraat 8, 3600 GenkTop 5 tenants

Genkpark 18,11%Carrefour Belgium 14,26%Sportsdirect.com 6,11%Lunch Garden 4,74%Piocheur 4,44%

Number of tenants: 56Construction: 1967 – Renovation:2014Location: The shopping centre islocated in the centre of GenkLettable area: 27,100 m2

7REAL ESTATE REPORT


Genk StadspleinStadsplein 39, 3600 GenkTop 5 tenants

Hennes & Mauritz 15,33%Zara 13,30%Quiral 9,25%C&A 8,72%JBC 6,60%

Number of tenants: 61Construction: 2008Location: The shopping centre islocated in the centre of GenkLettable area: 15,618 m2

Shopping centre WaterlooChaussée de Bruxelles 193-195,1410 WaterlooTop 5 tenants

Taboo 22,49%Club 19,45%Planet Parfum 12,97%Natural Food 10,58%Eram Chaussures 8,50%

Number of tenants: 12Construction: 1968Location: The shopping centre islocated in the centre of WaterlooLettable area: 3,347 m2

‘Forum Overpoort’ GentOverpoortstraat, 9000 GentTop 5 tenants

House Industries 24,46%Pam Team 24,46%DO Invest 17,31%Albert Heijn België 13,87%A.S. Watson Group 9,29%

Number of tenants: 7Construction: 2014Location: The complex is situatedalong the Overpoortstraat, in thecity centreLettable area:3,700 m2 + 119 student rooms



OFFICES

Office building in BrusselsMadou Center, Bischoffsheimlaan 1-8,1000 BrusselsTenant

Ergo Services KDV 100%

Number of tenants: 1Construction: 1975 – Renovation:2002Location: Along the inner ring ofBrussels, in district Arts/LoiLettable area: 12,162 m2

Office building in VilvoordeMedialaan 30-32, 1800 VilvoordeTop 5 tenants

Quintiles Belgium 31,02%Amadeus Benelux 20,48%Nutrition & Santé B-Lux

13,73%

Intersystems Benelux 8,72%Ricoh 2,94%

Number of tenants: 10Construction: 1999Location: In business park‘Business- & Mediapark’, near theBrussels ring (exit 6) and near thenational airportLettable area Medialaan 30:5,449 m2

Lettable area Medialaan 32:3,907 m2

Office building in VilvoordeMedialaan 28, 1800 VilvoordeTop 5 tenants

Ricoh 53,05%WGEO Ltd Belgium 14,47%ENI Gas & Power 12,57%Quinz Advocaten 12,57%Monster Belgium 11,57%

Number of tenants: 7Construction: 2001Location: In business park‘Business- & Mediapark’, near theBrussels ring (exit 6) and near thenational airportLettable area: 12,772 m2

7REAL ESTATE REPORT


Office building in VilvoordeJan Olieslagerslaan 41-45, 1800 VilvoordeTop 3 tenants

Sebia 51,49%Crawford & Co 38,55%Key Travel 9,97%

Number of tenants: 3Construction: 1998Location: In business park ‘BusinessClass’, near the Vilvoorde trainstationLettable area: 3,048 m2

Office building in AntwerpVeldekens II, Roderveldlaan 3-4-5,2600 AntwerpTop 5 tenants

ABN Amro Bank 19,33%24+ 18,72%Astrea 7,82%Vito 7,34%AON Belgium 7,30%

Number of tenants: 18Construction: 1999Location: Alongside the AntwerpringLettable area: 16,003 m2

Office building in AntwerpVeldekens I, Roderveldlaan 1-2,2600 AntwerpTop 3 tenants

Argenta Spaarbank 49,93%Proximus 29,78%Antea Belgium 20,29%




Office building in AntwerpVeldekens III, Berchemstadionstraat 76-78,2600 AntwerpTop 5 tenants

Amadeus Benelux 26,00%TVM Belgium 13,32%CWS-Boco Belux 7,81%Pearlchain 6,92%MazarsBedrijfsrevisoren

6,68%


7REAL ESTATE REPORT


PROJECTS

Shopping centre ‘Les Bastions’ – Tournai

SectorRetail

TypeExtension

ExtentExtension shopping centre: 14,500 m 2 GLAShopping centre after extension: 32,500 m 2 GLA

Estimated completionQ1 2018

Expected return 6.25% – 6.75%

StatusCommitted

start construction Q1/2016•estimated completion: Q1/2018•investment: € 65.8 mln•

Commercial complex – Waterloo

SectorRetail

TypeMultifunctional redevelopment of the shopping centre

Extent10,000 m 2 GLA


Expected return6.75% – 7.25%

StatusNot committed.

This urban development project is part of a masterplan that is again being studied at this time by the localauthorities. In this context, it is difficult for theManagement Company to estimate when this projectcould effectively be realised. The Company monitorsclosely the actual developments and decisions of thelocal government

Investment: € 52 mln



Shopping centre ‘Belle-Ile’ – Liège

SectorRetail

TypeExtension

Extent+/- 8,000 m 2 GLA


Expected return6.0% – 6.5%

StatusNot committed.The socio-economic and the building permit has beenobtained.

Priorities are:(1) attractive (international) brands(2) optimization of the branche mix(3) sustainability

Investment: € 50 mln

7REAL ESTATE REPORT


REAL ESTATE EXPERTS’ REPORTResolutions of the real estate experts, prepared on31 December 2016, following the valuation of theproperty portfolio, as referred to the Royal Decree of13 July 2014 with respect to regulated real estatecompanies, the RREC.

Both reports were executed according to the fair valueas defined in the ‘International Valuation Standards’,published by the ‘Royal Institution of CharteredSurveyors’ (the ‘Red Book’), an Internationally acceptedValuation method. The Fair Value is defined as ‘theprice that would be received if an asset was sold or asthe price that would have to be paid to transfera liability in an orderly transaction between marketparticipants at the valuation date’.

EVALUATION PRINCIPLES FOR THE PROPERTY PORTFOLIO

Cushman & Wakefield

Investment products: Capitalisation methodOur methodology is based on the Market Value andnot on the replacement cost. The method used is thecapitalisation of the market rent (MR) with correctionsto take account of the rent effectively paid and/or anyother element that could influence the value of theproperty such as cost of void.

In a first step, we determine the market rent.

We analyse at which level the building could be lettomorrow in the market. To determine this value, webased ourselves on our internal data and ontransactions currently going on in the market, whiletaking into account the location, the accessibility, thesite, buildings’ characteristics… This market rent persquare meter will be multiplied with the respectivesurface to come to the total estimated market rent.

After we have determined this market rent, we thencalculate the adjusted market rent (AMR). Two casescan occur:

In those cases where the current passing rent (PR) isunder this ERV, it is unlikely that in contract renewalswith sitting tenants, the full ERV will be obtained. It isstandard market practice to take into account that nomore than 60% of the gap between the actual passingrent and the ERV can be bridged in renegotiations.This mainly due to the high legal protection for sittingtenants under Belgian commerce law.

In those cases where the market rent (ERV) is under thepassing rent however, the highest rent a landlordshould hope to achieve is the market rent. Since, beingprudent, one should assume that the sitting tenant willuse the break to negotiate his rent downward andbring it in line with the market.

The second step consists in evaluating at which yieldan investor would be ready to buy this property. Todetermine this yield, we based ourselves on the mostcomparable transactions and on transactions currentlygoing on in our investment department. We obtaina gross market value before corrections.

In a third step, we then calculate the differencebetween the current rent and the AMR until the nextbreak. The corrections applied are negative when thetenant pays less than the capitalised value and positivewhen he pays more. These corrections will come inaddition or in deduction of our initial gross marketvalue to arrive at a gross market value after corrections.

The last step consists in obtaining the net market valueof the property. We achieve this value by deductingthe normative hypothetical costs of 2.5%.

Valuation total: € 660.5 mln.

Troostwijk – Roux Expertises CVBAWe opted to employ the income approach for thevaluation of the existing assets.

The Valuations were performed by experiencedappraisers and were based on:

The information made available to us by thecompany, such as the current rent, the conditions ofthe lease agreement, service fees, investmentexpenditure, etc;

•

The assumptions and valuation methods employedby the appraisers were wholly market-oriented,such as yields and capitalisation factors. They werebased on expert opinion and the observation of themarkets.

•

The income approach:



The fair value of an investment property (= theMarket Value) is determined by employing thediscounted cash flow projections, based onreasonable estimates of the future rental incomeand investments according to the present leasesand the other contracts. Where possible, externalinformation was also used, such as current marketrental prices for similar properties, the conditionand the location. When it comes to capitalisingprojected cash flows, capitalisation factors shouldbe used that represent the evaluation of uncertainmarket factors in the present market with respect tothe sum and the timing of the cash flows.

•

Methodology: DCFThe valuation of the properties was performed usingthe discounted cash flow method (DCF), a methodused to determine the current (market) value on thebasis of the future free cash flows.

ValuationOn the basis of what is set out in this Valuation, we areof the opinion that as of 31 December 2016 the sum ofthe separate market values of the leasehold propertiesand buildings, in relation to and as a result of thevarious leases, amounts to:

Total: € 124.0 mln

This Valuation contains no negative values.

The market value is consistent with valuationsperformed for the drafting of the annual financialstatements.

Transaction costsThe Valuation does not include VAT and theconstruction costs were not taken into account, norwas the value appraisal in the event of any Propertybeing sold. Our net valuation does not include theexpenses payable by the buyer either, which varybetween the different regions.

Assumptions and sources of informationAn assumption is defined in the Red Book’s glossary asa ‘supposition that is accepted as true’ (‘Assumption’).Assumptions are facts, conditions or situations thatinfluence the subject or the approach to a valuationand that – by agreement – must be verified by theappraising party as a component of the valuationprocess. In our valuations we employed a number ofassumptions as well as a specific number ofinformation sources. We are of the opinion that ourassumptions are reasonable, bearing in mind ourknowledge of the Properties and the contents of thereports made available to us. But should it turn out thatthese assumptions are incorrect, then the valuationmust be reviewed. We refer to the assumptions used inour valuation below.

InspectionsWe inspected all properties and the company’smanagement board informed us that no significantalterations were made to any properties whatsoeversince our previous inspection.

InformationWe assumed that the information provided to us byWereldhave Belgium and its professional consultantsconcerning the Properties was both complete andaccurate.

It follows from this that we drew up an assumption thatdetails which factors can affect the value, such aspossible rental transactions, rent reviews, pendingstatutory requirements and decisions concerningplanning made available to us, and that contains up-to-date information.

TitlesDuring an earlier valuation of the Properties, we basedour work on the information provided by the companywith respect to the quality and negotiability of the titlesto ownership for each Property. In those cases wherewe did not have access to statutory reports or titles toownership, we assumed that, unless proven otherwise,the Properties were freely available for sale and thatthey are free of encumbrances, mortgages and othercharges. Our Valuation was based on information thatwe obtained from third parties, including the propertyrights that, as appraisers for Wereldhave Belgium foraccounting purposes, we did not verify separately: wedeemed the information obtained to be accurate.

Surface areasWe did not measure the Properties and used thesurface areas provided to us and the measurementreports conducted for certain Properties in order tocheck the surface areas.

7REAL ESTATE REPORT


Machinery and installationsTangible fixed assets such as elevators, escalators, airconditioning and other standard installations wereconsidered to be an integral component of theproperties and constitute a part of our valuations.Machinery and installations, other installations andequipment belonging to the tenants were not includedin our valuation.

No specialised tests were performed on any of theservice systems, and for the purposes of the valuationwe assumed that they were in good condition and inline with the applicable laws and legislation.

Environmental and soil surveyNo inspections or environmental evaluations wereincluded in our assignment, and we did not performa historic survey into contamination of the land andbuildings. Unless we were told otherwise, we assumedthat the Properties are not affected by soilcontamination and that there is no reason to believethat the current or future designated use of theProperties will be affected by this factor.

We were not tasked with conducting structuralinspections of the Properties, but in our report weidentified the need for repairs, where necessary. TheProperties were appraised on the basis of the opinionof the Company that, subject to recommendations tothe contrary, no hazardous materials were used in theconstruction of the buildings.

PlanningWe only made verbal inquiries about urbanisationplans. In the course of our investigation the localauthorities informed us that there were no violationswith respect to town planning, landscaping or anyother plans. The information provided to us by theplanning officers was nevertheless issued without anyobligation on their part, which is why we cannot acceptresponsibility for incorrect information or substantiveomissions in the provided information.

We examined the building permits and assumed thatthe properties were built and are used in accordancewith all required permits and that there are nounresolved legal issues.

We assumed that all buildings comply with thestatutory requirements as well as those of the localauthorities, including building, fire, health and safetyregulations.

LeasesWith respect to the lease terms, contractual leases,indexation, additional income, unrecoverableexpenses and investment expenditure, we based ourwork on the information available in the leases that theCompany made available to us for the purposes of thisValuation.

While we did not conduct an investigation into thecreditworthiness of the tenants, we still took ourknowledge of the market perception of the tenants’financial situation into account in our Valuation. Weassumed that each tenant can meet its leaseobligations and that there have been no breaches ofcontracts.

As of 31 December 2016, the total value of theproperty portfolio amounts to € 784.5 mln.

Development projectsProperty that is being constructed or developed forfuture use as investment property is classified asa development project. Development projects areinitially valued at cost and are subsequently valued atfair value. Fair value measurement on developmentprojects is only applied for if the fair value isconsidered to be reliably measurable. If not,development projects are valued at historical cost lessdurable impairments. The following criteria areadopted to determine when a reliable fair value ofdevelopment projects can be determined:

building permit obtained;•agreements with general contractors signed;•sufficient finance arrangements in place;•> 70% pre-let.•

The total value of Development projects as of31 December 2016 amounts to € 35.3 mln.



8


STOCK EXCHANGE &WERELDHAVE BELGIUM

8


DIVIDEND AND NUMBER OF SHARESIn 2016, shareholders of the Company achieveda return (incl. share price fluctuations and grossdividend ) of 2.4% (2015: 11.2%).

The return of the EPRA Index Europe amounts to 4.7%.The price/Net result from core activities ratio at theend of 2016 was 18.6.

The closing share price of the Company at31 December 2016 was € 107.70 compared to€ 110.00 on 31 December 2015.

Neither Wereldhave Belgium nor any of its subsidiariesowns shares of Wereldhave Belgium.

There are no preference shares or shares withoutvoting rights, nor are there convertible bonds or

warrants that give entitlement to shares. Each of theseshares provides one voting right at the GeneralMeeting and these shares thus represent thedenominator for notification purposes within theframework of the transparency regulations (i.e.notifications in case of reaching, exceeding or notreaching the legal threshold of 5% or a multiple of 5%).The Company does not apply an additional statutorythreshold.

With an average of 1,347, the traded volumes in2016 were 26% lower than in 2015 (on average1,824 a day).

The velocity ratio of the share in 2016 was 0.02%.

THE WERELDHAVE BELGIUM SHARE

NUMBER OF SHARES 31-12-2014 31-12-2015 31-12-2016Number of shares at year end 6,308,198 6,939,017 6,939,017Number of shares entitled to dividends 6,308,198 6,939,017 6,939,017Registered shares 4,393,310 4,553,106 4,553,137Dematerialized shares 1,914,888 2,385,911 2,385,880Market capitalization at closing (€ mln) 643 763 747Free float 30.6% 30.4% 30.4%

Share price (€) 31-12-2014 31-12-2015 31-12-2016Highest closing price 104.17 112 121.3Lowest closing price 79.34 85.27 98.96Share price at closing 102.01 110 107.7Premium (+) / Discount (-) relative to the actual net assetvalue (%) 29.14 34.54 24.64Average share price 92.68 101.9 110.01

Data per share (€) 31-12-2014 31-12-2015 31-12-2016Net value (fair value) 78.99 81.76 86.41EPRA Net asset value 78.99 81.76 86.41Gross dividend 4.6 4.9 5.1Net dividend 3.45 3.58 3.57Gross dividend yield (%) 4.51% 4.45% 4.74%Net dividend yield (%) 3.38% 3.25% 3.31%Pay out ratio 87.00% 87.00% 88.24%

Volume (number of shares)Average daily volume 1,370 1,824 1,347Volume per year 349,324 466,905 346,302Velocity ratio 0.02% 0.03% 0.02%

8STOCK EXCHANGE & WERELDHAVE BELGIUM


DIVIDENDA gross dividend per share of €5.10 gross – € 3.57 net(2015: € 4.90 gross – € 3.577 net) is proposed to theGeneral Meeting of Shareholders. The dividend will bemade payable as of 20 April 2017. Decreed dividends

made payable after 1 January 2017 (subject to certainexemptions) are subject to a withholding tax rate of30% instead of 27% (Program law of 25 December2016 published in the Belgian Official Gazette StateJournal of 29 December 2016).

SHAREHOLDERSHIP

NAME

NUMBER OFVOTING RIGHTSHELD DIRECTLY

% OFVOTING RIGHTSHELD DIRECTLY

Wereldhave N.V. 2,524,529 36.38%WTC Schiphol Toren ASchiphol Boulevard 2331118 BH SchipholNederland

Wereldhave International N.V. 2,303,372 33.20%WTC Schiphol Toren ASchiphol Boulevard 2331118 BH SchipholNederland

Public 2,111,116 30.42%

TOTAL 6,939,017 100.0%

Transparancy declarationFederale Verzekeringen 347,645 5.01%Stoofstraat 121000 BrusselBelgië

Listing of shares held by Effective Leaders and members of the Board of Directors

Dirk Anbeek 0Luc Plasman 200Kasper Deforche 0

Dirk Goeminne 0Jacques De Smet 0Philippe Naert 0

8 STOCK EXCHANGE & WERELDHAVE BELGIUM


OTHER INFORMATIONOther information under Article 34 of the Royal Decreeof 14 November 2007 regarding the duties of issuersof financial instruments admitted for trading ona regulated market.

Capital structure1.At the date of this annual financial report, the sharecapital of Comm. VA Wereldhave Belgium is€ 292.77 mln divided among 6,939,017 shares, eachrepresenting 1/6,939,017 part of the share capitalwithout par value and fully paid.

There are no legal or statutory restrictions on thetransfer of securities and the exercise of voting rights.

Employee share scheme2.There is currently no employee share scheme.

Shareholder agreements which could lead totransfer restrictions or limitations on the exercise ofvoting rights

3.

On 28 October 2008, Wereldhave NV and WereldhaveInternational NV, according to the Law of 12 April2007, Article 74 § 7 point 3, mutually reported thatthey were in possession of more than 30% of theshares with voting rights in the company at the 1st ofSeptember 2008.

On 31 December 2016, 6,939,017 shares areoutstanding, of which 36.38% is held by WereldhaveNV, 33.20% by NV Wereldhave International and30.42% by the public.

Wereldhave International NV is a 100% subsidiary ofWereldhave NV.

Authorised capital4.Pursuant to article 7 of the Articles of Association, theCompany’s Management Company is authorised toraise the Company’s share capital, on one or moreoccasions, by a maximum amount of € 292,773,778.51.

By virtue of said article 7 of the Articles of Association,the general meeting of the Issuer is empowered torenew said authorisation as regards the authorisedcapital.

The authorisation to raise the Company’s share capital,on one or more occasions, by a maximum amount of€ 292,773,778.51 was renewed by the extraordinarygeneral meeting of 8 April 2015, for a term of fiveyears, counting from the compulsory disclosure in theSupplement to the Belgian Official Gazette, Ordersand Decrees of this decision on 24 April 2015. Theauthorisation granted is therefore valid until 24 April2020. As at the date of the present annual report, theCompany has not yet availed itself of saidauthorisation. This authorisation is renewable.

If the capital increases decided on by the ManagementCompany, as a consequence of the permissiongranted, comprise an issue premium, the amount ofthis issue premium must be placed in a special, non-distributable account called ‘issuance premiums’which, like the capital, will constitute the security forthird parties and cannot be reduced or dispensed withthis unless a decision to this effect is taken bya General Meeting that is assembled in accordancewith the attendance and majority requirementsenvisaged for a capital reduction, with the exception ofconversion into capital, as provided for above.

This/(These) capital increase(s) can be subscribed forin cash or in kind, or through the incorporation ofreserves and issuance premiums, as well as all ownassets under the IFRS separate financial statements ofthe Company (prepared under the Regulatory Regimegoverning publically Regulated Real Estate Companies(RRECs)) that may be converted into share capital, withor without the creation of new shares, with or withoutvoting rights, in accordance with the rules provided forin the Companies Code, the articles of association orthe applicable legislation governing the public RRECs.

FINANCIAL CALENDAR FOR 2017Press release results 2016 (8:00 AM) Thursday 2 February 2017General Meeting of Shareholders Wednesday 12 April 2017Ex-dividend Tuesday 18 April 2017Dividend record date Wednesday 19 April 2017Dividend payable 2016 Thursday 20 April 2017Press release Q1 2017 (8:00 AM) Thursday 20 April 2017Press release Q2 2017 (8:00 AM) Wednesday 20 July 2017Press release Q3 2017 (8:00 AM) Thursday 20 October 2017

Any changes to the financial agenda will be published in a press release that can also be consulted on the websiteof the Company: www.wereldhavebelgium.com.



STOCK EXCHANGE DATANET RESULT FROM CORE ACTIVITIES PER SHARE AND DIVIDEND PER SHARE

6

5

4

32006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

(x € 1)

Net result from core activities per share Dividend per share

SHARE PRICE/NET ASSET VALUE

119

112

105

98

91

84

77

7012/13 03/14 06/14 09/14 12/14 03/15 06/15 09/15 12/15 03/16 06/16 09/16 12/16

(before profit sharing x € 1)

Share price Net asset value



COMPARISON WERELDHAVE BELGIUM TO BEL20 CLOSE INDEX

20

15

10

5

0

-5

-10

-15

-2001/16 02/16 03/16 04/16 05/16 06/16 07/16 08/16 09/16 10/16 11/16 12/16

in %

Share price Wereldhave Belgium BEL20

TRADED VOLUMES WERELDHAVE BELGIUM

10,000

8,000

6,000

4,000

2,000

001/16 02/16 03/16 04/16 05/16 06/16 07/16 08/16 09/16 10/16 11/16 12/16



EPRA RETURN 2016*

20

15

10

5

0

-5

-100 1 2 3 4 5 6 7 8 9 10 11 12

EPRA return Wereldhave Belgium EPRA return euro zone

(*) These data are given for guidance only and are not required in accordance with the RREC-law and are also notsubject to any verification by public authorities; these figures have not been audited by the auditor.

(**) Share price evolution (including gross dividend) ofWereldhave Belgium.



9FINANCIAL REPORT


FINANCIALREPORT

9


CONTENTS FINANCIAL REPORT

CONSOLIDATED STATEMENTOF FINANCIAL POSITION 144

CONSOLIDATED PROFITAND LOSS ACCOUNT 146

STATEMENT OF COMPREHENSIVE INCOME 148

CONSOLIDATED CASH FLOW STATEMENT 149

CONSOLIDATED STATEMENTOF MOVEMENTS IN EQUITY 150

NOTES 1541 General information 1542 Fiscal status 1543 Accounting policies 1544 Consolidated statement of net result from

core (1) and non-core (2) activities to 31 december 1645 Segment information 1656 Investment properties 1697 Other tangible assets 1728 Current receivables 1739 Cash and cash equivalents 17410 Share capital 17411 Pension obligations 17512 Long-term financial debts 17613 Rent guarantees received 17614 Authorised hedging instruments 17615 Other non-current liabilities 17716 Deferred taxes 17717 Current liabilities 17718 Rental income 17919 Recovery of rental charges and taxes

normally paid by the tenant on let properties 17920 Rental charges and taxes normally

paid by the tenant on let properties 18021 Property charges 18022 General costs 18123 Result disposals of investment

properties and valuations differences 18224 Net realized gains on disposal of financial assets 18225 Financial result 183

26 Taxes on result 18327 Result per share 18328 Dividend 18429 Article 617 of the companies code 18430 Determining the debt ratio 18631 Intra-group related party transactions 18632 List of consolidated companies 18733 Leasehold- and investment liabilities

not shown on the balance sheet 18834 Remuneration of the auditor 18935 Branches 18936 Lawsuits and arbitration 189

AUDITOR’S REPORT 190

STATUTORY STATEMENT 192

9FINANCIAL REPORT


CONSOLIDATED STATEMENT OF FINANCIAL POSITION(X € 1,000)

ASSETS31 DECEMBER

201531 DECEMBER

2016I. Non-current assetsC. Investment properties 774,029 819,827

774,029 819,827D. Other tangible assets 654 632

654 632

II. Current assetsD. Trade receivables 8,139 9,451E. Tax receivables and other current assets 5,907 3,249F. Cash and cash equivalents 6,231 6,501

20,277 19,201Total assets 794,960 839,660

(X € 1,000)

SHAREHOLDERS' EQUITY31 DECEMBER

201531 DECEMBER

2016I. Shareholders' equity attributable to the parent company's shareholdersA. Capital 292,774 292,774B. Issue premiums 50,563 50,563C. Reservesa. Legal reserve 36 36b. Reserve for the balance of changes in fair value of real estate properties 103,745 113,007d. Reserve for the balance of changes in fair value of authorised hedging

instruments subject to hedge accounting -733 -808j. Reserve for actuarial gains and losses of defined pension schemes -993 -880m. Other reserves 986 986n. Accumulated result 71,541 77,667D. Net result of the year 49,391 66,241

567,310 599,586II. Minority interests 0 0

9 FINANCIAL REPORT


(X € 1,000)

LIABILITIES31 DECEMBER

201531 DECEMBER

2016I. Non-current liabilitiesA. Provisions

Pensions 1,232 1,168B. Non-current financial liabilitiesa. Credit institutions 110,000 140,000c. Other

Other loans 36,000 22,000Rent guarantees received 396 497

C. Other non-current financial liabilitiesAuthorised hedging intruments 733 808

E. Other non-current liabilities 0 16,447F. Deferred taxes - liabilitiesb. Other 1,730 1,799

150,091 182,719

II. Current liabilitiesB. Current financial liabilitiesa. Credit institutions 63,000 45,200c. Other

Other 1,417 434D. Trade payables and other current liabilitiesb. Other

Suppliers 6,222 5,821Taxes, remunerations and social security contributions 1,234 1,162

F. Accrued charges and deferred incomeReal estate income received in advance 2,082 1,570Other 3,604 3,168

77,559 57,355Total shareholders’ equity and liabilities 794,960 839,660

Net asset value per share (x € 1) 81.76 86.41

9FINANCIAL REPORT


CONSOLIDATED PROFIT AND LOSS ACCOUNT(X € 1,000)

31 DECEMBER2015

31 DECEMBER2016

I. Rental incomeRent 46,744 49,369Indemnification for early termination of lease 665 364Net rental income 47,409 49,733

V. Recovery of rental charges and taxes normally paid by the tenant on letproperties 8,376 10,908

VII. Rental charges and taxes normally paid by the tenant on let properties -8,716 -11,466-340 -558

Property result 47,069 49,175

IX. Technical costsRecurrent technical costsRepairs -372 -408Compensation for total guarantees -92 0Insurance premiums -40 -48

-504 -456X. Commercial costs

Agency commissions -369 -315Publicity -179 -300

-548 -615XI. Charges and taxes on non-let properties

Costs on non-let properties -727 -616Real estate tax on non-let properties -188 -165

-915 -781XII. Property management costs

(Internal) property management costs -1,327 -766-1,327 -766

Property charges -3,294 -2,618Property operating results 43,775 46,557

XIV. General company costsStaff costs -1,420 -2,085Other -1,655 -2,541

XV. Other operating income and charges 971 751-2,104 -3,875

Operating results before result on the portfolio 41,671 42,682

9 FINANCIAL REPORT


(X € 1,000)

31 DECEMBER2015

31 DECEMBER2016

XVII. Result on disposals of other non-financial assetsNet sales of other non-financial assets (sale price - transaction costs) 1 -1

1 -1XVIII. Variations in the fair value of investment properties

Positive variations in the fair value of investment properties 23,558 50,660Negative variations in the fair value of investment properties -14,815 -24,296

8,743 26,364XIX. Other result on portfolio -215 -117

-215 -1178,529 26,246

Operating result 50,200 68,928

XX. Financial incomeInterests and dividends received 559 0Net results on disposals of financial assets 1,823 0

XXI. Net interest chargesNominal interest charges on loans -2,960 -2,372

XXII. Other financial chargesBank charges and other commissions -76 -97Financial result -654 -2,469Result before tax 49,546 66,459

XXV. Corporate taxCorporate tax -102 -134Deferred tax on market fluctuations of investment properties -53 -84Tax -155 -218Net result 49,391 66,241Net result shareholders of the Group 49,391 66,241Result per share (x € 1) 7.12 9.55Diluted result per share (x € 1) 7.12 9.55

9FINANCIAL REPORT


STATEMENT OF COMPREHENSIVE INCOME(X € 1,000)

31 DECEMBER2015

31 DECEMBER2016

I. Net result 49,391 66,241

II. Other comprehensive incomeItems taken in the result

B. Changes in the effective part of the fair value of authorised cash flowhedge instruments as defined under IFRS -239 -75

C. Changes in the fair value of financial assets available for sale -565 0Items not taken in the result

E. Actuarial gains and losses of pledged pension schemes -6 113-810 38

Comprehensive income (I + II) 48,581 66,279Attributable to:Minority interests 0 0Shareholders of the group 48,581 66,279

9 FINANCIAL REPORT


CONSOLIDATED CASH FLOW STATEMENT(X € 1,000)

31 DECEMBER2015

31 DECEMBER2016

Cash flow from operating activitiesNet result before tax 49,546 66,459Income from interest and dividends -559 0Gain on sale real estate certificates -1,822 0Result exclusive of dividend received 47,165 66,459Depreciation tangible assets 261 265Rental discounts and investments 830 765Interest charges 3,030 2,561Variations in the fair value of investment property -8,743 -26,364Movements in provisions -1,250 -1,679Movements in short term debts 1,693 -1,819Corporate tax paid -102 -213Corporate tax received 121 2,891

-4,160 -23,593Net cash flow from operating activities 43,005 42,866

Cash flow from investment activitiesSale real estate certificates 18,127 0Advances received on non-current assets 0 16,447Payment for investment property -102,040 -20,074Income sale investment property 0 0Acquisition furniture and vehicles -104 -297Interest received 559 0Net cash flow from investment activities -83,458 -3,924

Cash flow from financial activitiesCapital increase 49,418 0Appeal credit institutions/Other 123,000 79,200Repayment credit institutions/Other -97,500 -81,000Dividends paid -29,023 -34,001Interest paid -3,265 -2,871Net cash flow from financing activities 42,631 -38,672

Net cash flow 2,178 270

Cash & bank balancesAt 1 January 4,053 6,231Increase/decrease cash and bank balances 2,178 270At 31 December 6,231 6,501

9FINANCIAL REPORT


CONSOLIDATED STATEMENT OF MOVEMENTS IN EQUITY(X € 1,000)

2015 NOTE SHARE CAPITAL ISSUE PREMIUMS LEGAL RESERVE

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF

REAL ESTATE PROPERTIES

Balance at 1 January 2015 266,160 27,759 36 104,043

Capital increase 26,614

Issue premiums 22,804

Variations in the fair value of hedging instruments

Variations in the fair value of financial assets

available for sale a

Transfer from reserves

Provisions for pensions

Other

Net result

Transfer of the result on the portfolio to reserve for

the balance of changes in fair value of real estate

properties -298

Dividend over 2014 b

Balance at 31 December 2015 292,774 50,563 36 103,745

9 FINANCIAL REPORT


(X € 1,000)

RESERVE FOR THE BALANCE

OF CHANGES IN FAIR VALUE

OF AUTHORISED HEDGING

INSTRUMENTS SUBJECT TO

HEDGE ACCOUNTING

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF

FINANCIAL ASSETS

AVAILABLE FOR SALE

RESERVE FOR

ACTUARIAL GAINS AND

LOSSES OF DEFINED

PENSION SCHEMES OTHER RESERVES ACCUMULATED RESULT NET RESULT OF THE YEAR TOTAL

-494 565 -987 1,019 100,183 498,284

26,614

22,804

-239 -239

-565 -565

-31 -31

-6 78 72

-2 -2

49,391 49,391

298 0

-29,018 -29,018

-733 0 -993 986 71,541 49,391 567,310

9FINANCIAL REPORT


(X € 1,000)

2016 NOTE SHARE CAPITAL ISSUE PREMIUMS LEGAL RESERVE

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF





available for sale



Other

Net result



properties 9,262

Dividend over 2015 c


Explanationa Variations in the fair value of financial assets available for sale

Revaluation real estate certificates: -565b Dividend paid 2014

€ 4.60 (net € 3.45) per share: -29,018c Dividend paid 2015

€ 4.90 (net € 3.577) per share: -34,001

9 FINANCIAL REPORT


(X € 1.000)

RESERVE FOR THE BALANCE

OF CHANGES IN FAIR VALUE

OF AUTHORISED HEDGING

INSTRUMENTS SUBJECT TO

HEDGE ACCOUNTING

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF

FINANCIAL ASSETS

AVAILABLE FOR SALE

RESERVE FOR

ACTUARIAL GAINS AND

LOSSES OF DEFINED

PENSION SCHEMES OTHER RESERVES ACCUMULATED RESULT NET RESULT OF THE YEAR TOTAL

-733 0 -993 986 120,932 567,310

-75 -75

0

0

113 113

-2 -2

66,241 66,241

-9,262 0

-34,001 -34,001

-808 0 -880 986 77,667 66,241 599,586

9FINANCIAL REPORT


NOTESGENERAL INFORMATION1.

Wereldhave Belgium (the Company) has the status ofa Regulated Real Estate Company (RREC). TheCompany invests preferably in shopping centers and/or extensions of shopping centers and, possibly(additionally), in offices, residential property and otherreal estate.

The Company is managed by the sole StatutoryManagement Company, represented by the Board ofDirectors. The Board of Directors of the ManagementCompany, Wereldhave Belgium NV, is composed of atleast four members. One is Executive Board memberof Wereldhave N.V. and three have the legal positionof Independent Director.

The Company quotes at the Euronext continuous stockexchange in Brussels.

The consolidated annual accounts from 1 January to31 December 2016 are the result of the consolidationof Wereldhave Belgium with its subsidiaries.

The consolidated annual accounts and consolidatedannual report were approved by the Board of Directorsof the Management Company on 6 March 2017. TheGeneral Meeting of Shareholders will be held on12 April 2017 at the registered offices of the company.The General Meeting of Shareholders is authorised tochange the approbation of the result within legal limits.

FISCAL STATUS2.Since 27 October 2014, Wereldhave Belgium benefitsfrom the tax status of RREC and is therefore (providedthat certain conditions are met) not submitted to

corporate income tax, except on possible exceptionalprofits and on disallowed expenditures.

ACCOUNTING POLICIES3.BASIS OF PREPARATION ANNUAL ACCOUNTS 20163.1

The Group’s functional currency is the Euro. Theconsolidated financial statements of the Companyhave been presented in Euros, rounded to the nearestthousand. The consolidated financial statements havebeen prepared in accordance with InternationalFinancial Reporting Standards (IFRS) as approved bythe EU. The consolidated and statutory financialstatements of the Company are determined on basis ofthe fair value unless otherwise stated.

The consolidated accounts have been prepared beforedistribution of profit. The consolidated balance sheetand the profit and loss account are established inaccordance with the scheme applicable to all BelgianRREC’s, in accordance with the Royal Decree of 13 July2014.

In 2016 the below mentioned new IFRS standards orinterpretations thereon, relevant to the Company,became applicable. These new or adjusted standardsand their interpretation had a minimal impact onWereldhave Belgium’s reporting for the year 2016. Itconcerns the following standards:

Amendments to IAS 16 and IAS 38 'Statement onacceptable depreciation method'

•

Amendments to IFRS 11 "Accounting foracquisitions of interests in joint operations'

•

Amendments to IAS 1 'The reporting initiative’•Improvements to IFRSs 2012-2014 cycle isa collection of minor improvements to four existingstandards

•

Amendments to IFRS 10 and IAS 28, "InvestmentCompanies - application of the exception toconsolidation '

•

Amendments to IAS 16•Amendments to IAS 27 'equity method in theseparate financial statements'

•

Changes in IFRS 10 and IAS 28: Sale or Transfer ofassets between an investor and an associate ora joint entity

•

9 FINANCIAL REPORT


New standards and interpretations not yet effective

A number of new standards, amendments to standardsand interpretations are not yet effective for the yearended 31 December 2016, and have not been appliedin preparing these consolidated financial statements:

IFRS 15 Revenue from Contracts with Customers,establishes a comprehensive framework fordetermining whether, how much and when revenue isrecognized. It replaces existing revenue recognitionguidance, including IAS 18 Revenue, IAS11 Construction Contracts, IFRIC 13 Customer LoyaltyProgrammes, IFRIC 15 Agreements for theConstruction of Real Estate, IFRIC 18 Transfers ofAssets from Customers and SIC 31 Barter TransactionsInvolving Advertising Services. IFRS 15 is effective forthe annual reports beginning on or after 1 January2018, with early adoption permitted, and has beenendorsed by the EU. Clarifications to IFRS 15 Revenuefrom Contracts with Customers (issued on 12 April2016) has not yet been endorsed by the EU.

The implementation of IFRS 15 is expected not to havea material impact on the Group’s consolidated financialstatements.

IFRS 16 Leases published on 13 January 2016 makesa distinction between a service contract and a leasebased on whether the contract conveys the right tocontrol the use of an identified asset and introducesa single, on-balance lease sheet accounting model forlessees. A lessee recognises a right-of-use assetrepresenting its right to use the underlying asset anda lease liability representing its obligation to makelease payments. There are optional exemptions forshort-term leases and leases of low value items. Lessoraccounting remains similar to the current standard– i.e. lessors continue to classify leases as finance oroperating leases. For lessors, there is little change tothe existing accounting in IAS 17 Leases.

IFRS 16 replaces existing leases guidance includingIAS 17 Leases, IFRIC 4 Determining whether anArrangement contains a Lease, SIC-15 OperatingLeases—Incentives and SIC-27 Evaluating theSubstance of Transactions Involving the Legal Form ofa Lease. The standard is effective for annual periodsbeginning on or after 1 January 2019. Early adoption ispermitted for entities that apply IFRS 15 Revenue fromContracts with Customers at or before the date ofinitial application of IFRS 16. This new standard has notyet been endorsed by the EU.

The full extent of the impact has not yet beendetermined. The Group has started an initial

assessment of the potential impact on its consolidatedfinancial statements. The Group expects that theimpact will be limited due to the fact that the Groupprimarily acts as lessor.

IFRS 9 Financial Instruments published in July2014 replaces the existing guidance in IAS 39 FinancialInstruments: Recognition and Measurement. IFRS9 includes revised guidance on the classification andmeasurement of financial instruments, including a newexpected credit loss model for calculating impairmenton financial assets, and the new general hedgeaccounting requirements, which align hedgeaccounting more closely with risk management. It alsocarries forward the guidance on recognition andderecognition of financial instruments from IAS 39.IFRS 9 is effective for annual periods beginning on orafter 1 January 2018, with early adoption permitted.This new standard has been endorsed by the EU.

The implementation of IFRS 9 is expected not to havea material impact on the Group’s consolidated financialstatements.

The disclosure initiative (Amendments to IAS 7)requires disclosures that enable users of financialstatements to evaluate changes in liabilities arisingfrom financing activities, including both changesarising from cash flow and non-cash changes. Theamendments are effective for annual periodsbeginning on or after 1 January 2017, with earlieradoption permitted. These amendments have not yetbeen endorsed by the EU.

The amendments are not expected to have a materialimpact on the Group’s consolidated financialstatements.

Recognition of Deferred Tax Assets for UnrealisedLosses (Amendments to IAS 12) clarifies theaccounting for deferred tax assets for unrealised losseson debt instruments measured at fair value. Further,the amendments provide guidance on estimatingprobable future taxable profits when assessing therecognition of deferred tax assets when there areinsufficient taxable temporary differences relating tothe same taxation authority and the same taxableentity. The amendments are effective for annualperiods beginning on or after 1 January 2017, withearlier adoption permitted. The amendments are notexpected to have a material impact on the Group’sconsolidated financial statements. These amendmentshave not yet been endorsed by the EU.

9FINANCIAL REPORT


Classification and Measurement of Share-basedPayment Transactions (Amendments to IFRS 2) issuedon 20 June 2016 covers three accounting areas: themeasurement of cash-settled share-based payments;the classification of share-based payments settled netof tax withholdings; and the accounting fora modification of a share-based payment from cash-settled to equity-settled. The amendments are effectivefor annual periods commencing on or after 1 January2018. As a practical simplification, the amendmentscan be applied prospectively so that prior periods donot have to be restated. Retrospective, or early,application is permitted if companies have therequired information. The amendments are notexpected to have a material impact on the Group’sconsolidated financial statements. These amendmentshave not yet been endorsed by the EU.

Transfers of property assets to/from, investmentproperty (Amendments to IAS 40) issued on8 December 2016, clarifies that a property asset istransferred to, or from, investment property when andonly when there is an actual change in use. A change inmanagement intention alone does not supporta transfer. The amendments are effective for annualperiods beginning on or after 1 January 2018, withearlier adoption permitted. The amendments are notexpected to have a material impact on the Group’sconsolidated financial statements. These amendmentshave not yet been endorsed by the EU.

IFRIC 22 Foreign currency transactions and Advanceconsideration issued on 8 December 2016, clarifies thetransaction date to be used to determine the exchangerate for translating foreign currency transactionsinvolving an advance payment or receipt. Theinterpretation is effective for annual periods beginningon or after 1 January 2018, with earlier adoptionpermitted. The amendments are not expected to havea material impact on the Group’s consolidated financialstatements. These amendments have not yet beenendorsed by the EU.

Annual improvements to IFRSs 2014-2016 Cycle,issued on 8 December 2016, covers the followingminor amendments:

IFRS 1 First-time Adoption of IFRS: Outdatedexemptions for first-time adopters of IFRS areremoved (effective for annual periods beginning onor after 1 January 2018);

•

IFRS 12 Disclosure of Interests in Other Entities: Alsoapplies to interests that are classified as held for saleor distribution (effective for annual periodsbeginning on or after 1 January 2017) and

•

IAS 28 Investments in Associates and JointVentures: A venture capital organisation, or otherqualifying entity, may elect to measure itsinvestments in an associate or joint venture at fairvalue (effective for annual periods beginning on orafter 1 January 2018, with earlier adoptionpermitted).

•

The amendments are not expected to have a materialimpact on the Group’s consolidated financialstatements. These amendments have not yet beenendorsed by the EU.

CONSOLIDATION3.2

SubsidiariesA subsidiary is an entity that is (exclusively or jointly)controlled by another entity.

Control is having power over the entity, having therights on variable return due to its participation in theentity, and having the possibility to use power over theentity to influence the amount of income. The annualaccounts of a subsidiary are included in theconsolidated annual accounts according to themethod of full consolidation from the start until theend of the control. If necessary, the general principlesof the financial reporting of the subsidiary are changedin order to achieve consistent principles within theGroup. The reporting period of the subsidiary is inaccordance with that of the parent company.

Intercompany transactions, balances and unreedprofits on transactions between subsidiaries areeliminated. Unrealised losses are also eliminated.

The basic principles of financial reporting forsubsidiaries have, where necessary, been adapted toguarantee the consistency with the basic principles forthe group.

Incorporating acquisitionsFor acquisitions, Wereldhave Belgium assesseswhether it is IFRS 3 ‘Business Combinations’ or IAS40 ‘Investment Property’ that applies. Acquisitions areconsidered to be a business combination if there is anacquisition of assets, rental activities and sucha management organisation that the acquired entitycan function autonomously as a company, with the aimof generating economic profits. Wereldhave Belgiumdoes not necessarily consider acquisitions of realestate that for business economic reasons arepurchased within a legal company to be a businesscombination, but assesses each acquisition individuallyon the basis of the aforementioned businesscharacteristics.

9 FINANCIAL REPORT


For the acquisition of business combinations, the fairvalue of the participation acquired is offset against theprice paid for the acquisition. If the fair value is lower,the difference between the sums paid and the fairvalue is accounted for as goodwill. If the sums paid arelower, the difference is accounted for directly in theprofit and loss account.

If an acquisition is not qualified as a businesscombination, it is incorporated on the basis of theindividual assets and liabilities; additional acquisitioncosts are capitalised and no goodwill or tax deferralsare taken into account.

Costs relating directly to the acquisition areincorporated in the profit and loss account.

EQUITY3.3The objective of Wereldhave Belgium, when managingcapital (as presented in the annual accounts), is tosafeguard the group’s going concern, provide returnsfor the shareholders, benefits for other stakeholdersand to maintain such a capital structure to optimize thecost of capital. Further Wereldhave Belgium managesits capital to ensure that it meets the requirementsfrom laws and regulations (Royal Decree of 13 July2014). The share capital is described in note 3.12.

Derogation shopping centre ‘Belle-Ile’ in Liège inaccordance with article 30 §3 and §4 of the RRECLaw.

On 23 December 2016, the FSMA (financial servicesand markets authority) allowed a renewed derogationto the shopping centre ‘Belle-Île’ in Liège on theprohibition of investing more than 20% of the assets inone property unit. The derogation is granted subject tothe following cumulative conditions:

The derogation has been accorded until31 December 2018;

•

The Company must quarterly report to the FSMAthe share represented by the shopping center'Belle-Ile' in the investment portfolio;

•

The periodic reports and prospectuses that will bepublished by the Company in the future shouldexplicitly mention that the chosen focus onshopping by the Company involves a greaterconcentration geographically, as well as a greaterconcentration of risk including technical issues andfire.

•

Wereldhave Belgium may adjust the amount ofdividends, return capital to shareholders, issue newshares or sell assets to maintain or adjust the capitalstructure.

BUSINESS COMBINATIONS AND GOODWILL3.4When the company takes control of an activity, asdefined in IFRS 3 – Business Combinations, the assets,liabilities and possible identifiable liabilities of theacquired activity are entered at their fair value. Thedifference between the fair value of the considerationtransferred to the seller and the share of WereldhaveBelgium in the fair value of the acquired net assets isa goodwill asset on the balance sheet. If the differenceis negative, then this surplus (negative goodwill orbadwill) is booked into the result after confirmation ofthe values.

The costs related to the acquisition, such as advisorfees, are booked directly as expenses (Net result fromnon-core activities).

IMPAIRMENT OF NON-FINANCIAL ASSETS3.5Assets having an indefinite useful life, e.g. goodwill,are not subject to amortisation and are tested on anannual basis for impairment. Assets subject toamortisation are reviewed for impairment when eventsor changes in circumstances occur which give anindication that the book value may not be recoverable.

Impairment is recognized in the profit and loss accountfor the amount that the book value of an asset exceedsthe recoverable amount, being the fair value minusselling costs. Non-financial assets other than goodwill,which are impaired, are assessed for possible recoveryof the impairment on each reporting date.

INVESTMENT PROPERTIES3.6Investment properties are those properties which areheld to earn rental income or for capital appreciationor for both. On acquisition, investment properties arerecognised at cost, including transaction costs.Investment properties are stated at fair value at thebalance sheet date. Fair values are based on theestimated amount for which a property could beexchanged on the date of valuation in an arm’s lengthtransaction.

9FINANCIAL REPORT


Fair value is based on the capitalisation of market rentsless operating costs like maintenance, insurances costsand fixed charges. The net capitalisation factor and thepresent value of the differences between market rentand contracted rent, of vacancies and of maintenanceexpenditure to be taken into account are calculated foreach property individually. Sale costs at the expense ofthe purchaser, among which transfer tax, are deductedfrom the fair value. At first balance sheet date afterpurchase, these sale costs are recognised in theincome statement. After acquisition subsequentexpenditure is added to the asset’s carrying amountwhen it is probable that future economic benefits willflow to the entity. All other expenditure, such as repairsand maintenance, are charged to the incomestatement during the financial period in which they areincurred.

The part property in own use is not significant andtherefore not classified separately as property in ownuse.

Investment properties that are located on a long term(emphytéose/erfpacht) lease parcel are valued at fairvalue in the same way as other investment properties,providing the fair value of the real estate includes thecash value of the obligations to pay the lease asa deduction.

The portfolio is valued quarterly at fair value by anindependent external valuer in conformity with‘International Valuation Standards’ and ‘EuropeanValuation Standards’. Valuation differences arerecognised in the income statement.

Rent-free periods and rent reductionsThe rent-free periods or the lease incentives granted totenants are amortised on a straight-line basis over theterm of the related lease, but only until the first breakright of the tenant.

Capitalised rent-free periods or other rent reductionsare amortised over the term of the related lease anddeducted from the rent income. In the determinationof the fair value of the investment properties portfolio,rent-free periods and other rent reductions arededucted from the valuation result in order to avoiddouble booking.

Development projectsProperty that is being constructed or developed forfuture use as investment property is classified asa development project.

Development projects are initially valued at cost andare subsequently valued at fair value. Fair valuemeasurement on development projects is only appliedfor if the fair value is considered to be reliablymeasurable. If not, development projects are valued athistorical cost less durable impairments. The followingcriteria are adopted to determine when a reliable fairvalue of development projects can be determined:

building permit obtained;•agreements with general contractors signed;•sufficient finance arrangements in place;•> 70% pre-let.•

The cost price comprises the cost price of the workcarried out, the costs of personnel directly related tothe project, charged with technical supervision andproject management on the basis of time spent andthe capitalised interest charges until the delivery dateon the basis of the interest charges to be attributeddirectly to the development project or on the basis ofthe group’s average effective interest rate if there is nospecific project financing. Interest charges compriseinterest and all the costs of Wereldhave Belgiumrelating to attracting money.

The fair value of project developments is determinedin exactly the same way as real estate investmentsproviding that the capitalisation factor is adjusted forany development risks present. If possible, the fairvalue is determined by independent real estateexperts. If this is not possible, an internal calculationmodel with similar parameters is used.

Impairment losses are recognised in the incomestatement. Development projects are transferred toinvestment properties on the date of technicalcompletion.

OTHER TANGIBLE ASSETS3.7Property and equipment are stated at cost lessdepreciation. Depreciation is charged to the incomestatement on a straight-line basis over the estimateduseful lives of the assets:

office furniture: 10 years•equipment: 3-5 years•cars (excl. residual value): 4 years•

Other tangible assets are yearly tested for impairment.

Gains and losses on disposals are recognised in theincome statement.

9 FINANCIAL REPORT


FINANCIAL ASSETS3.8Financial assets will include items due after more thantwelve months, unless mentioned otherwise. Capitalgains on disposals are accounted for under results ondisposals. Acquisitions and sales are accounted forbased upon trade date. Wereldhave Belgium classifiesits financial assets in the following categories:

at fair value through profit or loss;•loans and receivables and•available for sale.•

The classification depends on the purpose for whichthe financial assets were acquired. The classification isdetermined at initial recognition.

The fair value of financial instruments is, if available,determined by relevant quoted (bid)prices. In case thevaluations are not available on markets, the fair value isbased on information from banks, which is recalculatedin an internal calculation model. When informationfrom banks is also not available only internalcalculation models are used.

Financial assets at fair value through profit or lossFinancial assets at fair value through profit or loss arefinancial assets held for trading.

Financial assets at fair value through the incomestatement are initially and subsequently valued at fairvalue. The fair values are current bid prices in casethese are available. In case an open market value is notavailable, the fair value is based on information ofbanks, which is recalculated with internal calculationmodels.

Loans and receivablesLoans and receivables are non-derivative financialassets with fixed or determinable payments that arenot quoted in an active market.

Loans issued and other receivables are taken intoaccount, initially at fair value plus transaction costsdirectly attributable to the loan and subsequently at anamortised cost basis. Amortised cost is taken to theincome statement under interest income and expenseon the basis of the effective interest method.

When there is objective evidence that the company willnot be able to collect all amounts due, an impairmentof loans and receivables is established via the incomestatement to the amount collectible. Indicators for non-collectability are amongst others significant financialdifficulties of a debtor, non-compliance of paymentconditions and bankruptcy.

Financial assets available for saleFinancial assets available for sale are non-derivativesthat are either designated in this category or notclassified in any of the other categories. They areincluded in non-current assets unless managementintends to dispose of the investment within 12 monthsof the balance sheet date.

Financial assets available for sale are initiallyrecognised at fair value plus acquisition costs andsubsequently valued at fair value. Valuation results aredirectly taken to the comprehensive income. In casea decline of the fair values is significant or prolonged,impairments will be accounted for as impairment in theincome statement under revaluation result. Whensecurities classified as available for sale are sold orimpaired, the accumulated fair value adjustmentsrecognized in comprehensive income are included inthe income statement as results on disposal.

Dividends on financial assets are recognised in theincome statement as other income and expense whenthe right to receive payments is established.

Financial instrumentsHedging instruments are initially valued according tocost price and according to fair value at the followingreporting date. Changes in the Fair Value of financialinstruments are applied in the profit and loss account,unless the derivative complies with hedge accounting.

The fair value of a financial instrument is the amountthat the Company expects to receive if it is disposedon the balance sheet date, taking into account theapplicable interest rate and the credit risk of the otherparty. If a financial instrument can be documented asan effective hedge for the possible change that is dueto a certain risk connected to an asset or liability ora very likely future transaction, the part of the resultarising from the change in value of the instrument thathas been determined to be an effective hedge isimmediately justified in the other elements of theglobal result (equity capital) under ‘Changes in theeffective part of the Fair Value of authorised hedginginstruments subject to hedge accounting as defined inIFRS’. The ineffective part of the instrument is includedin the income statement.

9FINANCIAL REPORT


NON-CURRENT ASSETS AVAILABLE FOR SALE3.9Non-current assets (or a disposal group) are held forsale in case its carrying amount will be recoveredprincipally through a sale transaction rather thanthrough continuing use. For this to be the case, theasset (or disposal group) must be available forimmediate sale in its present condition. In addition, thesale must be highly probable, management must becommitted to a plan to sell the asset and an activeprogram to locate a buyer and complete the plan musthave been initiated. The sale should be completedwithin one year from the date of classification.

Non-current assets (or disposal group) classified asheld for sale shall be measured at the lower of itscarrying amount and fair value less costs to sell. Noremeasurement takes place when the assets arealready measured at fair value. Non-current assets heldfor sale or the assets from a disposal group shall bepresented separately from other assets in the balancesheet. The liabilities of a disposal group classified asheld for sale shall be presented separately from theother liabilities.

Those assets and liabilities that are held for sale shallnot be offset. Investment properties available for saleare valued in accordance with IAS 40.

A disposal group is a group of assets and liabilities thatis sold or intended to be sold in one transaction.

TRADE RECEIVABLES3.10Trade receivables are recognised initially at fair valueand subsequently at amortised cost, less provision forimpairment. A provision for impairment of tradereceivables is established when there is objectiveevidence that the company will not be able to collectall amounts due according to the original terms.Indicators for such an event are among otherssignificant financial difficulties of a debtor, non-compliance to payment conditions and bankruptcy.The amount of the provision is the difference betweenthe asset’s carrying amount and the estimated futurecash flows. The movement in the provision isrecognised as general costs in the income statement.

When trade receivables are uncollectible, it is writtenoff against the provision. Subsequent recoveries ofamounts previously written off are credited againstgeneral costs in the income statement.

CASH AND CASH EQUIVALENTS3.11Cash and cash equivalents comprise cash balancesand cash deposits. Cash equivalents are short-term,highly liquid investments (< 3 months) that are readilyconvertible to known amounts of cash and which aresubject to an insignificant risk of changes in value.

SHARE CAPITAL3.12Ordinary shares are classified as equity. External costsdirectly attributable to the issue of new shares areshown as a deduction from the proceeds.

PROVISIONS3.13A provision is recognised in the balance sheet whena legal or implicit obligation would exist, as a result ofa past event and when it is probable that an outflow ofeconomic benefits will be required to settle theobligation. Provisions are measured at the presentvalue of the expenditures expected to be required tosettle the obligation. The increase in the provision dueto passage of time is recognised as interest expense.

INTEREST BEARING DEBT3.14Interest bearing debts are initially recognised at fairvalue, less direct attributable transactions costs. Anydifference between nominal and book value isrecognised in the income statement over the period ofthe interest bearing liabilities on the basis of theeffective interest per loan. The short-term portion ofloans outstanding to be repaid within twelve months isshown under current liabilities.

PENSION SCHEME3.15

Defined contribution plansAs a consequence of the minimum guaranteed rates ofreturn, imposed by law, Belgian pension plans are nowclassed as ‘Defined benefit plans’ and the Company,therefore, has no pension plans that qualify as ‘definedcontribution plans’ under IFRS (International FinancialReporting Standards).

Defined benefit plansDefined benefit plans are pension schemes whereparticipants can derive statutory benefits at thepension date.

9 FINANCIAL REPORT


For defined pension plans, the cost of the definedbenefits is determined according to the ‘Projected UnitCredit Method’, in which actuarial valuations areperformed at every balance sheet date. The discountrate is the yield at the reporting date of high-qualitycorporate bonds with a maturity similar to the term ofthe group’s liabilities.

The net pension liability (or asset) relating to definedpension plans included in the balance sheetcorresponds to the difference between the obligationsof defined pension plans and the fair value of the planassets. In the event of a surplus, the net credit balancefrom defined pension plans shall be limited to thepresent value of the future economic benefits in theform of a reduction in future contributions to the planor, alternatively, a cash refund.

The obligations are calculated on the basis of thelegally guaranteed minimum return.

The fair value of the assets is determined by applyingIAS19.115; qualifying insurance policies are thereforetaken into account.

Revaluations of the net pension liability (or asset) ofdefined benefit obligations comprise actuarial profitsand losses on the defined benefit obligations,deviations from the expected return and changes inthe effect of the cap on the remaining pension claim.These revaluations are entered in the overall result andincorporated directly in the net equity.

The Company determines the net interest cost (orreturn) on the net defined benefit liability (or asset) forthe period by multiplying the net defined benefitliability (asset) by the discount rate as determined atthe start of the annual reporting period, taking accountof expected changes in the net defined benefit liability(asset) during the period as a result of contribution andbenefit payments. This net interest charge isrecognized in the consolidated income statement.

TRADE AND OTHER PAYABLES3.16Trade and other payables are recognised initially at fairvalue and subsequently at amortised cost basis usingthe effective interest method.

LEASES3.17Properties leased out under operating leases areincluded in investment properties in the balance sheet.When assets are leased out under a finance lease, thepresent value of the lease payments is recognised asa receivable under other non-current assets.

Leases in which substantially all risks and rewards ofownership are retained by another party, the lessor,are classified as operating leases. Payments, includingprepayments, made under operating leases, arecharged to the income statement on a straight-linebasis over the period of the lease. Leases of assetswhere the group company has substantially all the risksand rewards of ownership are classified as financeleases. Finance leases are capitalised at the lease’scommencement at the lower of the fair value of theleased property and the present value of the minimumlease payments. The corresponding obligations, net offinance charges, are included in long term liabilities.The interest element of the finance cost is charged tothe income statement over the lease period. Theinvestment properties acquired under finance leasesare carried at their fair value.

REVENUE3.18

Rental incomeRental income from investment property leased outunder operating lease is recognised in the incomestatement on a straight-line basis over the term of thelease. Lease incentives having the nature of rent freeperiods are recognised as an integral part of the rentalincome. The incentives are amortised over the term ofthe lease, limited to the first break of the lease.Amortisations are charged to rental income.

Rental income does not include amounts charged totenants in respect of common costs. Rental income isshown on an accrual basis.

Variable rental income such as rental income frominvestment property or rental income from incidentalrental are accounted for in the profit and loss accountfor the period to which they relate if they can bereliably assessed. If assessment is not possible, theywill be incorporated at the time of realisation.

EXPENSES3.19

Charges and taxes payable by tenants on letproperties (+/-)These are shown on a gross basis when the propertyowner acts as a principal. In the presentation ona gross basis costs and charges are shown separately.Costs and charges are shown on an accrual basis.

Property expensesThe amount consists of operating cost for the accountof the owner attributable to the accounting period,such as:

technical costs•

9FINANCIAL REPORT


charges and taxes of vacant properties•property management•commercial costs•

Technical costs include (major) repairs to andmaintenance of the buildings, costs of studiesregarding maintenance and repairs, costs for totalguarantees (a ‘Total Guarantee’ maintenance contractguarantees a constant level of yearly maintenance feeseven if major repairs become necessary in case ofunforeseen failures or breakdowns) as well as costs ofvacant properties.

Commercial costs include the depreciation ofexpenditure in connection with a letting. Theexpenditure is depreciated over the term of the lease.

Investment property depreciation charges are notrecognised since investment properties are valued atfair value (see note 6 ‘Investment properties’). The fairvalue calculation takes into account technical andeconomical obsolescence.

General costsThe amount comprises general costs attributable tothe accounting period. Direct staff costs relating toproperty management are included in propertyexpenses. Direct staff costs relating to supervising andmonitoring development projects are capitalised onthe basis of time spent.

INTERESTS3.20Interests comprise the total of interests attributable tothe accounting period on loans, other debts, accountsreceivable and cash and bank balances and is splitbetween interests received and paid. Due to theamortised cost valuation of interests bearing debts aswell as amortisation of the liability portion ofconvertible bonds, interest will include interestaddition to interest bearing debts on the basis of theeffective interest rate per loan.

Interest directly attributable to the acquisition orconstruction of an asset that necessarily takesa substantial period of time to get ready for itsintended use are capitalised as part of the cost of therespective assets, starting at the moment ofundertaking activities that are necessary to prepare theasset for its intended use till completion unless nofurther development takes place. The interestcapitalised is calculated the groups weighted averagecost of borrowings or the borrowing cost of a specificproject financing.

CORPORATE TAX3.21Income tax on profit and loss for a year comprisescurrent tax. Current income tax is the expected taxpayable or receivable on the taxable income or loss forthe period using tax rates prevailing at the balancesheet date and any adjustment to taxation in respect ofprevious years.

SEGMENT REPORTING3.22Operational segments are the individual activities ofthe Group, which are regularly assessed by theGroup’s Chief Operating Decision Maker (CODM), inorder to assess each segment’s performance and toallocate resources to them.

The Group’s segment reporting is presented, e.g. howthe internal financial information of the Group isorganized and reported to the Board of Directors ofthe Statutory Manager, who is the Group’s CODM. TheBoard of Directors of the Statutory Manager assessesthe Group’s performance and allocates resourcesbased on the individual sectors, namely ‘Offices’ and‘Retail’.

Results, assets and liabilities per segment compriseitems which can be directly attributed thereto.

DIVIDENDS3.23Dividends are recognised as debts to shareholders inthe year in which they are attributed.

IMPORTANT ASSESSMENTS3.24

Investment propertiesThe assets of the company mainly consist of the realestate portfolio. The market value of these assetscannot be assessed using official quotations or listings.

A valuation based on fair value is a time- and place-based estimate. IFRS 13 defines ‘fair value’ as the pricethat would be received to sell an asset or paid totransfer a liability in an orderly transaction betweenmarket participants at the valuation date. Thedefinition assumes a (hypothetical) transaction. Soeven if the company intends to use an asset rather thansell, it determines the fair value based on the(hypothetical) retail price.

An independent external valuer bases his fair valuevaluation on his own market knowledge andinformation.

9 FINANCIAL REPORT


The fair value is based on a net yield calculation, wheremarket rents are capitalised and normative propertyexpenses (such as the costs of maintenance, insuranceand expenses) are deducted. The yields used arespecific for the country, the location, the type ofproperty, the level of maintenance and the generallettability of every single property. The determinationof applicable yields is based upon comparabletransactions, added with market and building specificknowledge and remaining other assumptions.

Apart from assumptions with regard to yields, costs forfuture maintenance investments are also taken into

account in the valuation. Furthermore, explicitassumptions are made per lettable location and pertenant with regard to the possibility of (re)letting, thestart date of such (re)letting and the costs relatedhereto. Finally, adjustments are made for expectedcosts of vacancy (present and future) and fordifferences between the market rent and contractualrent. The valuation is carried out after the deduction ofhypothetical normative sales costs, set at 2.5%, whichwill be charged to the buyer.

General assumptions with regard to the valuation ofinvestment property have been disclosed in note 6.

9FINANCIAL REPORT


CONSOLIDATED STATEMENT OF NET RESULT FROM CORE (1) AND NON-CORE (2)ACTIVITIES TO 31 DECEMBER

4.

(X € 1,000) 2015 2016

(1) (2) (1) (2)Net rental income 47,409 49,733Rental charges and taxesnormally paid by the tenant onlet properties -340 -558Property charges

IX. Technical costs -504 -456X. Commercial costs -548 -615XI. Charges and taxes on non-let

properties -915 -781XII. Property management costs -1,327 -766XIV. General company costs -3,075 -4,626XV. Other operating income and

charges 971 751

Operating results before resulton the portfolio 41,671 42,682

XVII. Result on disposals of othernon financial assets 1 -1

XVIII. Change in fair value of theinvestment properties- positive 23,558 50,660- negative -14,815 -24,296

XIX. Other result on portfolio -215 -117Operating result 41,672 8,528 42,681 26,247

Financial result -2,477 1,823 -2,469 0Result before tax 39,195 10,351 40,212 26,247Corporate tax -102 -53 -134 -84

Net result 39,093 10,298 40,078 26,163

Profit per share (x €1) 5.63 1.49 5.78 3.77

Wereldhave Belgium distinguishes the net result from core and non-core activities. This provides a clearer view ofthe Company’s result. The net result from core activities includes the rental income result, the property expenses,the general costs and the financial result. The net result from non-core activities includes the valuation result, theresult on disposal of investment properties and other results (i.a. financial result) that are not allocated to the netresult from core activities. Such presentation is not required by IFRS Standards.

9 FINANCIAL REPORT


SEGMENT INFORMATION5.The segmentation (offices and retail) reflects the approach of the Statutory Management Company on theassessment of the financial benefit and the allocation of resources and group activities. As Statuary ManagementCompany, it operates as a ‘chief operating decision maker’.

The segmentation of rental income, property charges, investment properties and revaluations to the followingsectors occurs as follows:

(X € 1,000)

2016 OFFICES RETAIL TOTALRent 9,754 39,614 49,369Indemnification for early termination of lease 110 254 364Net rental income 9,864 39,869 49,733Rental charges and taxes normally paid by thetenant on let properties -118 -440 -558

IX Technical costs -456Repairs -178 -230Insurance premiums -2 -46

X Commercial costs -615Agency commissions -231 -84Publicity -41 -258

XI Charges and taxes on non let properties -781Costs on non let properties -313 -302Real estate tax on non let properties -15 -150

XII (Internal) property management costs -70 -696 -766Property operating results 8,895 37,662 46,557

XIV/XV

General company costs and other operatingincome and charges -3,875Operating result before result on the portfolio 42,682

XVII Result on disposals of other non financial assets -1XVIII Variations in the fair value of investment properties 26,364


XIX Other result on portfolio 0 -117 -117Operating result 68,928Financial result -2,469Result before taxes 66,459

9FINANCIAL REPORT


(X € 1,000)

2016 OFFICES RETAIL TOTALCorporate tax -134Deferred taxes on market fluctuations of investmentproperties -84Tax -218Net result 66,241

Investment propertiesInvestment properties excl. development projects

Balance at 1 January 124,894 607,026 731,920Investments 478 3,178 3,656Transfer from development to investment 0 17,030 17,030Revaluation -1,920 32,671 30,751Balance at 31 December 123,452 659,905 783,357Capitalised rent incentives 577 575 1,152Value investment properties excl. developmentprojects 124,029 660,480 784,509

Development projects

Balance at 1 January 40,547 40,547Investments 15,873 15,873Transfer from development to investment -17,030 -17,030Revaluation -4,388 -4,388Capitalised interest 316 316Balance at 31 December 35,318 35,318

9 FINANCIAL REPORT


(X € 1,000)

2015 OFFICES RETAIL TOTALRent 9,676 37,068 46,744Indemnification for early termination of lease 148 517 665Net rental income 9,823 37,586 47,409Rental charges and taxes normally paid by thetenant on let properties -152 -188 -340

IX Technical costs -504Repairs -220 -152Compensation for total guarantees -45 -47Insurance premiums -12 -28

X Commercial costs -548Agency commissions -207 -162Publicity -31 -148

XI Charges and taxes on non let properties -915Costs on non let properties -398 -329Real estate tax on non let properties -134 -54

XII (Internal) property management costs -227 -1,100 -1,327Property operating results 8,397 35,378 43,775

XIV/XV

General company costs and other operatingincome and charges -2,104Operating result before result on the portfolio 41,671

XVI Result on disposal of investment properties 0XVII Result on disposals of other non financial assets 1XVIII Variations in the fair value of investment properties 8,743


XIX Other result on portfolio 0 -215 -215Operating result 50,200Financial result -654Result before taxes 49,546

9FINANCIAL REPORT


(X € 1,000)

2015 OFFICES RETAIL TOTALCorporate tax -102Deferred taxes on market fluctuations of investmentproperties -53Tax -155Net result 49,391

Investment propertiesInvestment properties excl. development projects

Balance at 1 January 125,559 597,048 722,607Investments 441 -701 -260Acquisitions 0 0 0Transfer from development to investment 0 0 0Revaluation -1,106 10,679 9,573Balance at 31 December 124,894 607,026 731,920Capitalised rent incentives 958 604 1,562Value investment properties excl. developmentprojects 125,852 607,630 733,482

Development projects

Balance at 1 January 25,802 25,802Investments 15,340 15,340Disposals 0 0Transfer from development to investment 0 0Revaluation -830 -830Capitalised interest 235 235Balance at 31 December 40,547 40,547

9 FINANCIAL REPORT


INVESTMENT PROPERTIES6.(X € 1,000)

2015 2016Investment properties excl. development projectsBalance at 1 January 722,607 731,920Transfer of development projects to investment properties 0 17,030Investments -260 3,656Revaluations 9,573 30,751Balance at 31 December 731,920 783,357Book value of capitalised rent incentives 1,562 1,152Value investment properties excl. development projects 733,482 784,509

Development projectsBalance at 1 January 25,802 40,547Transfer of development projects to investment properties 0 -17,030Investments 15,340 15,873Revaluations -830 -4,388Capitalised interest 235 316Balance at 31 December 40,547 35,318Total investment properties 774,029 819,827

INVESTMENT PROPERTIES EXCLUDINGDEVELOPMENT PROJECTS

6.1

INVESTMENTSThe investments concern investments in the existingportfolio (2016: € 3.7 mln; 2015: € -0.3 mln).

TRANSFER FROM DEVELOPMENT PROJECTS TOINVESTMENT PROPERTIESTransfer (reclassification) of the retail park (10,000 m²),adjacent to the shopping center "Les Bastions" inTournai, from development projects to operationalinvestment properties (€ 17.0 mln).

CHANGES IN FAIR VALUE OF REAL ESTATEPROPERTIESThe valuation result (2016: € 30.7 mln; 2015: € 9.6 mln)is the result of the positive and negative valuationresult of the investment properties portfolio excludingdevelopment projects. This variation is attributable tothe non-recurring positive effect of the change in theaverage transaction rate to 2.5% (€ 54.9 mln) and toa negative revaluation (€ -24.2 mln) from the existingportfolio mainly due to lower valuations for thebuildings in Genk and the office building Madou.

2.5% Transfer duties rate

In the course of the second semester of 2016, a study(conducted by independent real estate experts)ordered by the association of REIT’s (BE-REIT),confirmed that the average transfer duty percentage of2.5%, which is applied by the sector, can still beconsidered as acceptable. The previous studies werecompleted 10 years ago. Due to legislative changesover the last years, there was some uncertainty as tothe realistic nature of this rate. The outcome of therecent study confirmed this reality and thus removessuch uncertainty.

Because Wereldhave Belgium was the only remainingREIT that did not apply the percentage of 2.5%, itdecided to perform additional analysis of the sectorstudy outcome by examining whether this lower ratemay also be applied to the type of real estate in whichit invests, i.e. shopping centres. Wereldhave Belgiumordered a legal analysis and entrusted one of its legaladvisers to examine the various possible transactionscenarios for the Company (applying the lower rate).

9FINANCIAL REPORT


This legal analysis, as well as the recent legislativechanges creating a framework for unlisted real estateinvestment companies (FIIS) and the announcedmodification of the REIT Act (expected in April 2017,and implying that REIT participations of less than 50%can be held in institutional REIT’s or related companies(with a minimum level of 25%)), opens newperspectives to structure transactions with lower rates.

Based on the above and its own market insights,the Company considers that the legal and practicalreality to operate with lower rates is extended andthat it is appropriate to apply the 2.5% rate (Insteadof the nominal transaction costs of 10% -12.5%).

•

The Manager (Board of Directors) of WereldhaveBelgium believes that the pallet of possiblescenarios offers a broader perspective for possibledivestments and considers appropriate to assesand apply those scenarios for future divestmentprojects. The change in the applied transactionpercentage was considered as a change in estimatein accordance with IFRS and the positive impact of€ 54.9 mln was recognized in the income statementin 2016.

•

Madou building

The closing of the legal transfer of the office buildingMadou occurred at the end of 2016. In the course of2016, the current tenant notified his decision to leavethe premises by the end of the lease agreement (i.e.31 January 2018). Given the fact that the buildingneeds substantial investments to enable new leasing,combined with the non-strategic nature of the officebuilding portfolio, it was decided to sell this asset.However, Wereldhave Belgium keeps the right on therent cash flow up to the expiry of the current lease andbears the operational risks up to that date. The salesagreement therefore provides that the buyer will onlyhave the use of this asset in the state in which it will beuntil the expiry date of the lease agreement (i.e.31 January 2018).

Wereldhave Belgium considers that the realizationcriteria are not (yet) fulfilled per end 2016 because notall significant risks and revenues of the asset weretransferred at that time. This is a.o. based on theassessment that the impact of the continuinginvolvement can be considered as significant.

On this basis, the accounting processing will occur asfollows:

The asset is not considered as realised in theaccounting and still appears in the balance sheet athis fair value (€18.6 mln);

•

The balance of cash flow related to the currentlease agreement will still appear as revenue untilthe expiration of this agreement (early 2018). Thesame applies to the balance of rental costs. The fairvalue of this investment property will decrease inthe same proportion. As such, the property will notor barely contribute to the net result in 2017 and2018;

•

The payment received from the buyer will appearas a debt in the balance sheet per 31 December2016, i.e. as a prepayment;

•

The asset can be realised upon the expiry of thelease agreement with the current tenant given thefact that at that moment, all significant risks andadvantages will be transferred.

•

The investment portfolio was valued at 31 December2016 by Cushman & Wakefield and CVBA Troostwijk-Roux, independent real estate experts.

RENT-FREE PERIODS AND LEASE INCENTIVESRent-free periods or ‘lease incentives’ allowed totenants, are amortized over the term of the lease, butnot later than the first possibility of termination on theside of the tenant.

Capitalised rent-free periods or other lease incentivesare amortized over the term of the lease contract anddeducted from the rental income.

In order to avoid double counting, the rent-freeperiods and other lease incentives are deducted fromthe valuation result when determining the fair value ofthe investment properties’ portfolio.

VALUATIONInvestment properties are valued at fair value. IFRS13 defines the ‘fair value’ as the price that would bereceived if an asset was sold or as the price that wouldhave to be paid to transfer a liability in an orderlytransaction between market participants at thevaluation date. Thus, the definition assumesa (hypothetical) transaction. So even if the companyhas the intention to use an asset rather than sell it, itdetermines the fair value based on the (hypothetical)selling price.

The fair value is based on the market rent minus thenormative operation costs. In order to determine thefair value, the net capitalization factor and the netpresent value of the differences between the marketrent and the contractual rent, of vacancy and of thenecessary future investments, are determined for eachobject. The hypothetical normative transaction costs of2.5% are deducted from this value.

9 FINANCIAL REPORT


DEVELOPMENT PROJECTS6.2

INVESTMENTSThe investments (€ 15.9 mln) mainly concern theconstruction works related to the development of theextension (€ 13.9 mln) of shopping centre ‘LesBastions’ in Tournai with 15,000 m². This developmentgoes according to plan, and the commercialisation isongoing. Technical completion is scheduled for thesecond quarter of 2018. The start-up costs (€ 1.3 mln)relating to a possible extension (8,000 m² GLA) ofshopping centre 'Belle-Île' in Liège are, in particular,study and design costs. Urbanistic and environmentalpermits have been granted and are final. Thecommercialisation of this project has been started;

The project costs achieved related to the otherdevelopment projects concern starting and studycosts.

TRANSFER FROM DEVELOPMENT PROJECTS TOINVESTMENT PROPERTIESTransfer (reclassification) of the retail park (10,000 m²),adjacent to the shopping center "Les Bastions" inTournai, from development projects to operationalinvestment properties (€ 17.0 mln).

REVALUATIONSThe property investments/property developmentsportfolio is valued according to cost price initially andsubsequently according to fair value. If the fair valuecannot be reliably determined, the development

project is valued based on the historical cost priceminus permanent depreciations (see point 3.Accounting policies).

The urban development project "Coeur de Ville" atWaterloo (10,000 m² GLA) is part of a master plan thatis again being studied at this time by the localauthorities, but without consensus. In this context, it isdifficult for the Management Company to estimatewhen this project could effectively be realised. Asa result of these changed circumstances, it wasconsidered that there were indications of animpairment and the fair value was set at € 1.9 mln,being the value of the land position and the estimatedvalue of the permits. This value has been confirmed bythe independent real estate expert. The ManagementCompany estimates that the other start-up costs(€ -4.4 mln) needed to be written-down and theconcrete developments and decisions of the localauthorities are to be monitored closely.

CAPITALISED INTERESTInterest (€ 0.3 mln) that is directly attributable toa property development for which a substantial periodis needed before it is ready for use is activated as partof the costs of the asset in question. The capitalisedinterest is calculated as the weighted average of thefinancing costs of the group or the financing costs ofspecific project financing.

The weighted average interest rate for 2016 was 0.99%(2015: 1.19%).

SENSITIVITY ANALYSIS6.3

(X € MLN) VALUATION PARAMETERS 'FAIR VALUE'

PUBLIC QUOTATIONQUANTIFIABLE

PARAMETERSUNQUANTIFIABLE

PARAMETERSTOTAL LEVEL 1 LEVEL 2 LEVEL 3

Assets measured at fair valueInvestment properties 784.5 784.5Development projects * 35.3 35.3Available for saleLiabilities whose fair value isdescribedReserve authorised hedginginstruments 0.8 0.8Interest-bearing liabilities 207.2 207.2

There were no reclassifications between the differentlevels during the year of return.

9FINANCIAL REPORT


*Development projects are first valued at cost and,after that, at fair value. If its fair value cannot bemeasured reliably, the development projects can bevalued at historical cost less impairments. Thefollowing criteria are chosen in order to decide whena property development can be measured at fair value:

An irrevocable building permit has been obtained;•

An approved building contract;•

Funding requirements are met;•

>70% has already been pre-let.•

RANGEWEIGHTED

AVERAGEHypothesis capitalisation of the market rent methodCapitalisation factor Retail 5,4 - 6,2% 5.70%

Offices 6,7 - 7,8% 6.90%

Market rent Retail € 150 - € 1.000 € 242Offices € 90 - € 175 € 138

Hypothesis DCFDiscount rate 5.75% - 7.2% 6.40%Inflation % 2% 2%Duration 10 year 10 year

The sensitivity of the fair value can be estimated asfollows:

The effect of an increase (decrease) of 1% of rentalincome leads to an increase (decrease) of the fairvalue of the portfolio of about € 8.4 mln;

•

The effect of an increase (decrease) of the averageinitial yield of 25 basis points leads to a decrease(increase) of the portfolio of about € 35.2 mln.

•

OTHER TANGIBLE ASSETS7.(X € 1,000)

OFFICE EQUIPMENT CARS TOTALBalance on 1 January 2016 265 389 654Purchases (+/-) 63 238 301Disposals (+/-) 0 -53 -53Depreciation (+/-) -112 -158 -270Balance on 31 December 2016 216 416 632

Balance on 1 January 2015 382 429 811Purchases (+/-) 5 142 147Disposals (+/-) 0 -59 -59Depreciation (+/-) -122 -123 -245Balance on 31 December 2015 265 389 654

9 FINANCIAL REPORT


(X € 1,000)

2015 2016Total purchase cost 2,101 2,460Total depreciation -1,447 -1,828

Net book value 654 632

Other tangible assets include plant, machinery andequipment as well as vehicles.

CURRENT RECEIVABLES8.(X € 1,000)

2015 2016Rent 1,647 4,848Common charges to receive 1,002 1,279Other 5,490 3,324Tax receivables and other current assets 5,907 3,249Totaal 14,046 12,700

(X € 1,000)

2015 2016Aging balance RentCurrent 0 178< 30 days 677 3,658>= 30 days and < 90 days 287 91>= 90 days and < 360 days 310 774>= 360 days 373 147Total 1,647 4,848

The fair value of the trade receivables (€ 9.4 mln)corresponds to the balance sheet value due to the veryshort-term nature of these assets and the bankguarantees given by the lessees (€ 18.2 mln). The risein the rent item is due to the fact that the advance levyon immovables is only passed on to lessees afterreceipt of tax assessment notices (these are not sentout by the Tax Administration until late November).The costs were passed on by the Company in earlyDecember.

There are no lessees that account for > 10% of theturnover.

The Company’s shareholding in the listed real estatecertificates ‘Basilix’ and ‘Ring Shopping Kortrijk Noord’is now in the final stages of liquidation. The liquidationcoupons relating to the limited, undistributed balancewere recorded under the item ‘trade receivables-Other’ (€ 873k). Consequently, these coupons nolonger affect the Company’s trading result.

9FINANCIAL REPORT


(X € 1,000)

2015 2016Tax receivables and other current assets 5,907 3,249

TaxesWithholding tax to recover: Ring Shopping Kortrijk Noord 3,221 550Withholding tax to recover: Basilix 2,295 2,193Withholding tax to recover: Other 0 95Property tax to recover 236 310VAT to recover 155 101

CASH AND CASH EQUIVALENTS9.(X € 1,000)

2015 2016Bank 6,231 6,501Total 6,231 6,501

The heading ‘Bank’ gives an overview of the financialaccounts at different financial institutions.

SHARE CAPITAL10.(X € 1,000)

AMOUNTSNUMBER OF

SHARESIssued capitalOn 31 December 2015 292,774 6,939,017On 31 December 2016 292,774 6,939,017

Bearer shares and dematerialised shares without nominal valueRegistered 4,553,137Dematerialised 2,385,880Total on 31 December 2016 6,939,017

Issue premiumsOn 31 December 2015 50,563On 31 December 2016 50,563

9 FINANCIAL REPORT


ShareholdersOf the 6,939,017 shares in circulation at 31 December2016, 36.38% were held by Wereldhave N.V. 33.20%by N.V. Wereldhave International and 30.42% by thegeneral public.

The statutory Management Company is entitled toincrease the company capital in one or more issues bya maximum amount of € 292,773,778.51. Thisauthorisation has been renewed on 16 February2015 and is valid for five years.

DATE OPERATION

CAPITAL

MOVEMENT

(€ X 1,000)

TOTAL CAPITAL

AFTER OPERATION

(€ X 1,000)

NUMBER OF

CREATED SHARES

TOTAL

NUMBER OF

SHARES

15 January 1998 Incorporation 172,750 172,500 5,234,636 5,234,636

14 May 1999 Merger by absorption of Groter Berchem plc 52,469 224,969 97,311 5,331,947

11 April 2012

Merger by absorption of Redevco Retail Belgium

plc 41,191 266,160 976,251 6,308,198

16 February 2015 Capital increase in cash 26,614 292,774 630,819 6,939,017

Issue premiums

11 April 2012

Merger by absorption of Redevco Retail Belgium

plc 27,759

16 February 2015 Capital increase in cash 22,804

On 31 December 2016 50563

PENSION OBLIGATIONS11.(X € 1,000)

2015 2016Net liability on 1 January 1,372 1,232Movements in liabilities -140 -64Net liability on 31 December 1,232 1,168

Within the framework of a ‘Defined benefit plan’ for thebenefit of the staff 53.4 FTE (2015: 50.2 FTE)a provision was created of € 1.168k (2015: € 1.232k).All defined benefit plans are financed externally viaa collective insurance contract. All plans comply withthe regulatory frameworks and minimum financingrequirements; these were reviewed on 31 December2016.

The provision has been recalculated by an externalactuary. The actuarial assumptions are in line with themarket, and the main assumptions include thediscount rate (1.15%), expected future salary increases(2.0%) and expected inflation (2.0%.) No specific assetswere used for these liabilities.

9FINANCIAL REPORT


LONG-TERM FINANCIAL DEBTS12.Wereldhave Belgium has seven committed credit lines(revolving credits) amounting to € 404.5 mln,€ 162 mln of which was used at the end of 2016. Theaverage interest rate for 2016 was 0.99% (2015:1.19%).

The fair value does not differ from the nominal valuesince it concerns short-term prepayments with variableinterest rate.

It concerns credit facilities for which no guaranteeshave been provided.

These credit lines are, admittedly, the subject ofseveral covenants – the ‘retention of REET status’ anda ‘negative pledge’ being the main ones. The Board ofDirectors of the Management Company keeps a closewatch on these covenants. As at 31 December, allconditions relating to the covenants have been met.(see Title 1: Risk factors/Financial risks)

(IN € MLN)

COMMITTEDAMOUNT

CALLED UP BY31 DECEMBER

2015 (**)


2016 (**) MATURITYBorrowerBNP Paribas Fortis 30 30 0 11/04/2017ING 30 30 0 17/04/2018ING 50 50 50 01/04/2019Wereldhave NV (*) 150 22 22 31/07/2019Wereldhave NV (*) 14.5 14 0 18/08/2019BNP Paribas Fortis 70 0 60 30/04/2021KBC 60 0 30 30/04/2021TOTAL 404.5 146 162

(*) Wereldhave NV holds on 31 December 2016, directly and indirectly 69,58% of the outstanding shares of the Company.(**) These amounts are not cumulative.

Sensitivity analysisA change (+/-) of the financial market interest rate by1% has an effect of € 1.6 mln on the result and theequity capital (€ 0.2 per share).

RENT GUARANTEES RECEIVED13.(X € 1,000)

2015 2016Guarantee tenants 396 497Net book value 396 497

AUTHORISED HEDGING INSTRUMENTS14.The Company currently has performed one InterestRate Swap regarding the ING loan amounting to€ 50 mln (final expiry date 1 April 2019).

9 FINANCIAL REPORT


MATURITY NOMINAL AMOUNT INTEREST RATEBALANCE ON31/12/2016

Start date: 22/10/2014 € 50 mln 1.51% € -0.8 mlnEnd date: 01/04/2019

By performing this Interest Rate Swap, the variableinterest rate (Euribor – 3 months + margin) is convertedto a fixed interest rate until the final expiry date of thecredit facility. Thus, this financial instrument is

considered a ‘cash flow hedge’ as stipulated in IAS39 § 86 (b). This concerns a full effective hedge,processed completely in the statement ofcomprehensive income.

OTHER NON-CURRENT LIABILITIES15.The payment received from the buyer of the officeMadou is classified as a long-term debt in the balance

sheet at 31 December 2016, as being a prepayment.See also note 6.

DEFERRED TAXES16.(X € 1,000)

2015 2016Deferred taxes 1730 1799

The provision for deferred taxes (Immo Guwy– Waterloo Shopping) is the result of the differencebetween fair value of the investment properties andthe fiscal book value.

CURRENT LIABILITIES17.(X € 1,000)

2015 2016Credit institutions 63,000 45,200Other current financial liabilities 1,417 434Trade payables 6,222 5,821Taxes, remunerations and social security contributions 1,234 1,162Rental income received in advance 2,082 1,570Other accrued charges and deferred income 3,604 3,168Total 77,559 57,355

Credit institutions: Wereldhave Belgium hasa committed credit line (revolving credit) by BNPParibas Fortis of € 30 mln with a duration until 2017,which was withdrawn entirely by the end of 2016. Thewithdrawals take place according to a variable interestrate.

The Company also has a non-committed credit lineamounting to € 26 mln without expiry date with BNPParibas Fortis, € 15.2 mln of which was withdrawn bythe end of 2016.

9FINANCIAL REPORT


For 2016 as a whole, the weighted average interestrate was 0.99% (2015: 1.19%). Fair value does notdiffer from the nominal value as it concerns short-term

advances at floating interest rates. No collateralsecurity was put up for this credit facility.

CREDIT INSTITUTIONS

(IN € MLN)

COMMITTEDAMOUNT


2015 (*)


2016 (*) MATURITYBorrowerBNP Paribas Fortis 30 0 30 11/04/2017BNP Paribas Fortis 60 60 0 30/04/2016TOTAL 90 60 30

(IN € MLN)

UNCOMMITTEDAMOUNT

CALLED UP BY31 DECEMBER2015 (*)

CALLED UP BY31 DECEMBER2016 (*) MATURITY

BorrowerBNP Paribas Fortis 26 3 15.2 N/ATOTAL 26 3 15.2

(*) Wereldhave NV holds on 31 December 2016, directly and indirectly 69,58% of the outstanding shares of the Company.

OTHER CURRENT FINANCIAL DEBTS (€ 0.4 mln)The dividends of previous financial years that have notbeen collected yet (€ 64k), deferred charges(€ 0.4 mln), inter-company interest payable (€ 14k).

SUPPLIERSThe trade payables (€ 5.8 mln) concern the short-termliabilities related to investments, development projectsand current supplier obligations. Per object, theobligations are assigned as follows:

Remaining investment commitment Tournai Retail Park 745

Remaining investment commitment Tournai Shopping

Centre 2,109

Remaining investment commitment shopping centre Genk

'Shopping 1' 190

Remaining investment commitment shopping centre

Nivelles 57

Remaining investment commitment shopping centre Genk

Stadsplein 177

Remaining investment commitment shopping centre

Kortrijk 353

Remaining investment commitment office building 55

Various suppliers 2,135

5,821

9 FINANCIAL REPORT


TAXES, REMUNERATIONS AND SOCIAL CHARGES(€ 1.2 mln)Taxes (€ 0.3 mln), remunerations and social charges(€ 0.9 mln).

PROPERTY YIELDS RECEIVED IN ADVANCE(€ 1.6 mln)Rental incomes received with regard to the followingcalendar year.

OTHER ACCRUALS (€ 3.2 mln)This concerns the accruals related to general companyexpenses and real estate charges.

RENTAL INCOME18.(X € 1,000)

2015 2016Rental income 48,260 50,805Rent reductions -1,516 -1,436Rent 46,744 49,369

Indemnification for early termination of lease 665 364Net rental income 47,409 49,733

The rental income is spread among about 500 (trade)leases, held with national and international retailersand leading companies.

Office and retail space are the object of (trade) leasecontracts with various expiry dates. Rents are adjustedbased on the health index annually. The leaseagreements determine the rent, the rights andobligations of the tenant and lessor, termination andrenewal conditions and any common charges. Passingon of charges is not included in the rental income.

Lease incentives are spread over the period from thestart of the lease contract until the first possibility oftermination by the contracters.

Rent loss as a result of vacancy, expressed asa percentage of theoretical rent amounted to 4.2%.

The ten main tenants represent 25.3% of the totalrental income.

The future aggregate contractual rent from leaseagreements on 31 December 2016 is as follows:

(X € 1,000)

2015 2016

Year 1 45,410 46,442

Year 2 - year 4 108,557 118,940

Year 5 31,420 24,922

Net book value 185,387 190,304

RECOVERY OF RENTAL CHARGES AND TAXES NORMALLY PAID BY THE TENANT ON LETPROPERTIES

19.

(X € 1,000)

2015 2016Recovery of rental charges paid by the owner 8,376 10,908Net book value 8,376 10,908

9FINANCIAL REPORT


This amount includes the recharging of the commoncharges (€ 9,3 mln) and of promotional costs

(€ 1,6 mln) as contractually stipulated in the leaseagreement.

RENTAL CHARGES AND TAXES NORMALLY PAID BY THE TENANT ON LET PROPERTIES20.(X € 1,000)

2015 2016Rental charges paid by the owner -8,716 -11,466Net book value -8,716 -11,466

This amount includes the common charges (€ 9.6 mln)and promotional costs (€ 1.9 mln).

PROPERTY CHARGES21.(X € 1,000)

2015 2016Technical costs 504 456Vacancy charges 727 616Commercial costs 548 615Property tax due to vacancy 188 165Management costs 1,327 766Net book value 3,294 2,618

Technical costs comprise the recurring maintenance(€ 408k) and the insurance premiums (€ 48k).

Commercial costs comprise the agent fees (€ 315k)and the publicity costs (€ 300k).

The internal management costs include costs that canbe attributed directly to the conservation of theinvestment portfolio (€ 766k).

9 FINANCIAL REPORT


GENERAL COSTS22.(X € 1,000)

2015 2016Staff costsSalaries 1,912 1,631Social security 962 1,049Allocation salary cost to development projects -2,345 -1,262Profit sharing 628 469Pensien en insurance costs 423 439Other staff costs 241 347Subtotal staff costs 1,821 2,673Allocated to management/property charges (22%) -401 -588Total staff costs 1,420 2,085

Other costsAudit fees 199 87Advisory fees 809 1,153Other costs 1,114 1,672Subtotal other costs 2,122 2,912Allocated to management/property charges (22%) -467 -371Total other costs 1,655 2,541

Other operating income and chargesOther income -1,451 -1,498RREC costs 232 221Investment fund tax 383 526Subtotal other operating income and charges -836 -751Allocated to management/property charges (22%) -135 0Total other operating income and charges -971 -751

Total general costs 2,104 3,875

THE APPORTIONMENT KEY FOR ASSIGNINGGENERAL EXPENSES TO PROPERTY CHARGESFor 2016, 22% (2015: 22%) of the general expenses(2016: € 0.9 mln, 2015: € 1.0 mln) has been assignedto management/ property charges. Thisapportionment key has been computed normativelyand applied to the respective tasks of the employeesand the other general expenses.

PENSION COSTSThe pension costs contain the premium for thepension schemes of employees.

STAFFAs per 31 December, an average of 50.3 FTE wasemployed.

The profit sharing, paid out to employees, is based onthe following indicators: occupancy, property charges,management fees, sustainability and like-for-like rentalgrowth. For each indicator, an objective has been set.The score compared to the objectives determines theresult.

MANAGEMENT COMPANYThe remuneration of the Management Company isfixed at € 120,000.

9FINANCIAL REPORT


RESULT DISPOSALS OF INVESTMENT PROPERTIES AND VALUATIONS DIFFERENCES23.(X € 1,000)

2015 2016Positive revaluation 23,558 50,660Negative revaluation -14,815 -24,296Net book value 8,743 26,364

See also note 6.1

NET REALIZED GAINS ON DISPOSAL OF FINANCIAL ASSETS24.(X € 1,000)

2015 2016Financial assets held for sale: real estate certificatesBalance as at 1 January 9,116 0Reclassification real estate certificates 'Basilix' -9,116 0Revaluations (via equity) 0 0Balance as at 31 December 0 0

(X € 1,000)

2015 2016Realization of real estate certificates 10,380 0Value at 31 December -9,116 0Variation 559 0Realized gain on liquidation real estate certificate 1,823 0

The participation held in the listed real estatecertificates ‘Basilix’ and ‘Ring Shopping Kortrijk Noord’are in the liquidation phase.

The liquidation coupon on the limited undistributedamount were included in trade receivables, thereforethis will have no more impact on the results of theCompany.

9 FINANCIAL REPORT


FINANCIAL RESULT25.(X € 1,000)

2015 2016Financial incomeInterests received (coupon real estate certificate Basilix) 559 0Net results on disposals of financial assets 1,823 0

2,382 0Interest costs -2,960 -2,372Other -76 -97Total -654 -2,469Average interest rate on loans 1.19% 0.99%Net interest costs -2,960 -2,372Weighted average debt for the period 248,700 239,600

The interest charges (€ 2.4 mln) include the interestpaid on cash management of the company.

TAXES ON RESULT26.Corporate income tax is calculated based on anyexceptional and favourable advantages and rejectedexpenses.

The subsidiaries are subject to the common tax regimeand may therefore need to pay corporate tax underthe normal regime.

(X € 1,000)

2015 2016Corporate tax -102 -134Deferred tax on market fluctuations of investment property -53 -84Total -155 -218

The provision for deferred taxes (Immo Guwy– Waterloo Shopping) is the result of the difference

between the fair value of the investment propertiesand the fiscal book value.

RESULT PER SHARE27.The result per share is calculated based on the totalprofit after tax and the average number of shares heldin the year (2016: € 9.55; 2015: € 7.12). No financialinstruments have been issued that are convertible intoshares.The weighted average of the number of sharesheld as per 31 December 2015 was 6,939,017.

9FINANCIAL REPORT


DIVIDEND28.After the balance sheet date, the Board of Directors ofthe Management Company has proposed to pay outan amount of € 35.4 mln (2015: € 34.0 mln), i.e.a gross dividend of € 5.10; net € 3.57 (2015:€ 4.90 – € 3.577) per share. No provision has been

made in the consolidated annual accounts for thedividend.

Calculation of the dividend is done in accordance withthe relevant legislation (Royal Decree of 13 July 2014).

DETERMINATION OF THE AMOUNT OF MANDATORY DIVIDEND

(X € 1,000)

2015 2016Net result 48,832 68,627Depreciation 141 158Other non-monetary elements 215 116Result on disposal of real estate properties -1,823 0Variation in the fair value of real estate properties -8,513 -29,763

Corrected result for mandatory distribution 38,852 39,138

Minimum result to be distributed (80%) 31,082 31,310

Operating result allocated to dividend distribution 34,001 35,389Operating result allocated to dividend distribution / per share 4.90 5.10

The corrected result does not need to be furthermodified for any possible non-exempt gain ondisposals of property investments or debt reductions.

As a result, the corrected result equals the amount thatis eligible for the mandatory payment of 80%according to article 45, 2° of the RREC Law.

ARTICLE 617 OF THE COMPANIES CODE29.The amount, as referred to in article 617 of the BelgianCompanies Code, of paid-up capital or, if this amountis higher, the called-up capital, plus all reserves which,

pursuant to the law or the articles of association, maynot be distributed, is determined in Chapter 4 of annexC of the Royal Decree of 13 July 2014.

9 FINANCIAL REPORT


DETERMINATION OF THE AMOUNT PURSUANT TO ARTICLE 617 OF THE COMPANY CODE

(X € 1,000)

2015 2016Non-distributable elements of shareholders' equity for profit distributionCapital 292,774 292,774Issue premiums 50,563 50,563Legal reserve 0Reserve for the balance of changes in fair value of real estate properties 107,943 116,456Reserve for the balance of changes in fair value of authorised hedginginstruments subject to hedge accounting -733 -808Reserve for the balance of changes in fair value of financial assets available forsale 0 0Reserve for actuarial gains and losses of defined pension schemes 0 0

Result of the financial year which, pursuant to chapter 4 of annex C of theRoyal Decree of 13 July 2014, is to be allocated to non-distributable reserveTransfer of the result on portfolio to the reserve for the balance of changes infair value of real estate properties 8,513 29,763

Total non-distributable shareholders'equity 459,060 488,748

Shareholders' equity 568,782 603,407Proposed dividend distribution 34,001 35,389Number of shares 6,939,017 6,939,017

Remaining reserves after distribution 75,721 79,270

9FINANCIAL REPORT


DETERMINING THE DEBT RATIO30.(X € 1,000)

STATUTORY BAL-ANCE SHEET

CONSOLIDATED BAL-ANCE SHEET

Total items "Liabilities" in the balance sheet 237,524 239,977I. Non current liabilities 180,834 182,719

A. Provisions -1,089 -1,168C. Other non-current financial liabilities - Authorised hedginginstruments -808 -808F. Deferred taxes - Liabilities 0 -1,799

II. Current liabilities 56,689 57,258A. ProvisionsC. Other current financial liabilities - Authorised hedging instrumentsF. Accrued charges and deferred income -4,208 -4,640

Total items "Liabilities" considered for the calculationof the debt ratio(numerator) 231,419 231,561

Total "Assets" in the balance sheet 840,930 839,562Authorised hedging instruments recorded under assets

Total "Assets" considered for the calculation of the debt ratio (denominator) 840,930 839,562

Debt ratio 27.5% 27.6%

INTRA-GROUP RELATED PARTY TRANSACTIONS31.The remuneration of the Management Company,Wereldhave Belgium NV, is determined by the GeneralMeeting of Shareholders and has been set at€ 120,000 (excl. VAT).

Intra-group fees, relating to IT support, amounts over2016 € 345k (excl. VAT).

Credit facilities (revolving credits) provided by the FBIaccording to Dutch law Wereldhave N.V. to the Comm.VA Wereldhave Belgium.

On 31 July 2014, Wereldhave NV has a creditfacility amounting to € 150 mln granted for a periodof 5 years. As per 31 December 2016, € 22 millionhas been withdrawn by the Company.

•

On 18 August 2014, Wereldhave NV has anadditional credit facility amounting to € 14.5 mlngranted for a period of 5 years. As per31 December 2016, no use was made of this creditfacility by the Company.

•

Both credits were granted according to conditions thatare in line with the market (Euribor + 120 Bps andEuribor + 80 Bps respectively).

Except from the decreed dividends and the above-mentioned transactions, there have been no othertransactions with other group companies in 2016.

Compensation for the executive / non-executivedirectors / members of the executive management isexplained in the remuneration report included in theconsolidated annual report (See p. 59 and p. 63)

The NV Wereldhave Belgium holds no shares oroptions in the Company and/or in NV WereldhaveBelgium. The members of the Board of Directors of theManagement Company hold no shares. The Companyhas not extended loans, advances or guarantees to NVWereldhave Belgium nor to the members of the Boardof Directors.

9 FINANCIAL REPORT


LIST OF CONSOLIDATED COMPANIES32.The companies below were incorporated into theconsolidation according to the full consolidationmethod:

COMPANY ADDRESSCOMPANY NUM-BER

INVESTMENTS INAFFILIATED ENTER-PRISES (X € 1,000)

HELD PART OF CAP-ITAL (IN %)

Joseph II plcMedialaan 30 B 6,1800 Vilvoorde BE 0472.903.308 62 99.84%

Immo Guwy plcMedialaan 30 B 6,1800 Vilvoorde BE 0404.024.004 8,463 100%

Waterloo Shopping Ltd.Medialaan 30 B 6,1800 Vilvoorde BE 0452.882.013 208 100%

W.B.P.M. plcMedialaan 30 B 6,1800 Vilvoorde BE 0833.792.402 62 99%

Wereldhave Belgium Services plcMedialaan 30 B 6,1800 Vilvoorde BE 0422.120.838 1,503 99.52%

10,298

Except for Wereldhave Belgium Services NV, theadministration of these companies is done by theCompany in its role as parent company.

J-II NVJ-II NV, with its registered offices at Medialaan 30, box6, 1800 Vilvoorde, and with company number0472.903.308, was established on 29 September2000 within the framework of the sale to Fortis BankNV of the amount of ground rent paid under theagreement dated 11 May 2000 in which WereldhaveBelgium Comm. VA provided a long-term lease of27 years to the European Union for a property locatedat 1000 Brussels, Joseph II-laan 26-30. At the momentof establishment, bare ownership of this property wasincluded in the capital of J-II NV and its shares werepledged in favour of Fortis Bank NV. This company hasno activities, other than being the holder of theresidual ownership rights of the above-mentionedproperty.

The value of the residual property rights of thisproperty located at Joseph II-laan 26-30, 1000 Brusselsequals € 1 for J-II NV, since J-II NV has granted thelong leaseholder (the European Union) a purchaseoption for acquisition of the residual ownership rights,plus the non-expired annual amount of ground rent

due from the date of exercising the option until 10 May2027, whereby the long leaseholder (the EuropeanUnion) can exercise the purchase option in the secondquarter of the year 2026 upon payment of € 1, to beincreased by the not yet expired annual ground rentdue as from the date of exercising the purchase optionuntil 10 May 2027, as a result of which the longleaseholder will become the full owner of the propertystarting from 30 September 2027. The de factoexpectation is that the long leaseholder (the EuropeanUnion) will exercise the purchase option in the secondhalf of the year 2026 of the long lease right (i.e. 2027),with the result that it is thus correct from an accountingpoint of view that the current book value of theresiduary ownership rights of this property located atJoseph II-laan 26-30, 1000 Brussels for J-II NV equals€ 1 (i.e. the purchase price due from the long leasegiver (the European Union) upon exercising thepurchase option during the period from 1 July2026 – 31 December 2026). In addition, it can bestated that J-II NV has no other obligations towards thelong leaseholder (i.e. the European Union) within theframework of this transaction or towards BNP ParibasFortis as the purchaser of the ground rent amount ofthe long leasehold agreement.

9FINANCIAL REPORT


Waterloo Shopping BVBA and Immo Guwy NVWaterloo Shopping BVBA, with its registered offices atMedialaan 30, 1800 Vilvoorde and with companynumber 0452.882.013, and Immo Guwy NV, with itsregistered office at Medialaan 30, 1800 Vilvoorde, andwith company number 0404.024.004 are two projectcompanies that are active within the framework ofmodernisation and expansion to 10,000 m2 of an openspace shopping centre in Waterloo with undergroundparking garage and 52 apartments in the centre ofWaterloo. Immo Guwy NV will develop the retail andparking part that forms part of a residential, retail andparking project at the previous ‘Delhaize site’ inWaterloo, which is part of the block between Chausséede Bruxelles, Avenue Reine Astrid, Avenue de l’Angeand Rue Maurice Verbeeck; Waterloo Shopping BVBAwill develop the residential part.

The urban development project "Coeur de Ville" atWaterloo (10,000 m² GLA) is part of a master plan thatis again being studied at this time by the localauthorities, but without consensus. In this context, it isdifficult for the Management Company to estimatewhen this project could effectively be realised. Asa result of these changed circumstances, it wasconsidered that there were indications of animpairment and the fair value was set at € 1.9 mln,

being the value of the land position and the estimatedvalue of the permits. This value has been confirmed bythe independent real estate expert. The ManagementCompany estimates that the other start-up costs(€ -4.4 mln) needed to be written-down and theconcrete developments and decisions of the localauthorities are to be monitored closely.

The investment amount of this development isestimated at about € 52 mln.

WBPM NVWBPM NV, with registered office at Medialaan 30,1800 Vilvoorde and with company number0833.792.402 is an ad hoc company that wasestablished on 8 February 2011. The limitedoperational activity is coming to an end and consistssolely of the administrative, legal and technicalservices of a limited number of property projects ofING REDH Belgium NV that have not been taken overby Wereldhave Belgium Comm. VA.

Wereldhave Belgium Services NVSince July 2014, the Company owns 99.52% of theshares of Wereldhave Belgium Services NV, which actsas a property and asset manager of the Company’sinvestment properties portfolio.

LEASEHOLD- AND INVESTMENT LIABILITIES NOT SHOWN ON THE BALANCE SHEET33.The Company has contracted investment liabilitiesamounting to € 17.4 mln. These concern the expansionof the ‘Les Bastions’ shopping centre in Tournai. Theleasehold liabilities amount to € 33.4 mln and theseare related to the ‘Ring Kortrijk Shopping Noord’shopping centre.

The ageing analysis of the leasehold- and investmentliabilities is as follows:

(X € 1,000)

2015 2016< 1 year 3,586 14,798>1 year - < 5 year 1,544 4,544> 5 year 31,894 31,508Total 37,024 50,850

9 FINANCIAL REPORT


REMUNERATION OF THE AUDITOR34.The remuneration concerning the auditing activities for2016 amounted to € 91,250 excl. VAT, for audit related

activities € 8,000 excl. VAT and for non-audit activities€ 10,515 excl. VAT.

BRANCHES35.The company has no branches.

LAWSUITS AND ARBITRATION36.The Company, as a defendant or a plaintiff, is involvedin a small number of lawsuits which the Companygenerally feels are not likely to have a major impact onthe financial position or the profitability of theCompany, either because the sums which are at issueare relatively insignificant or because the risk ofa judgement against the Company is minor.

Withholding tax on decreed dividends to WereldhaveNV and Wereldhave International NVLitigation is ongoing regarding the repayment ofBelgian withholding tax (5% tax at source) that hadbeen paid for the years 1999 and 2000.

In the course of the action, the Court of Appeal inBrussels made a preliminary referral to the EuropeanCourt of Justice in Luxembourg about correctapplication of the Parent/Subsidiary Directive(90/435/EEC) and about the principle of freemovement of capital.

In his advice, the Advocate General concluded that theParent/Subsidiary Directive does not apply in thepresent case. He did not, however, comment oncorrect application of the principle of free movementof capital due to unclear phrasing of the question.

There is no ruling, as yet, from the Court of Justice.

The ruling of the Court of Justice is scheduled for8 March 2017.

Only after a final court decision will it become clearwhether the 5% withholding tax has to be deducted ondividends paid by the Company to the Dutch affiliatesWereldhave NV and Wereldhave International NV.

The final outcome of this dispute will probably not beknown till 2018, at the earliest.

Should – after intervention of a final court decisionabout the years 1999 and 2000 – the TaxAdministration decide to collect the withholding taxesand overdue payments by legal process for past taxassessment periods, as provided for under Belgianlaw, then Wereldhave NV and WereldhaveInternational NV shall, each for their part in the lawsuit,indemnify the Company against any action to settle thewrongly, not-deducted withholding tax that waspayable on dividend payments included in said taxassessment periods.

9FINANCIAL REPORT


AUDITOR’S REPORTStatutory auditor's report to the general meeting ofWereldhave Belgium Comm. VA as of and for theyear ended 31 December 2016In accordance with the legal requirements, we reportto you in the context of our statutory auditor’smandate. This report includes our report on theconsolidated financial statements as of and for the yearended 31 December 2016, as defined below, as wellas our report on other legal and regulatoryrequirements.

Report on the consolidated financial statements- unqualified opinionWe have audited the consolidated financial statementsof Wereldhave Belgium Comm. VA (“the Company”)and its subsidiaries (jointly “the Group”), prepared inaccordance with International Financial ReportingStandards as adopted by the European Union, andwith the legal and regulatory requirements applicablein Belgium. These consolidated financial statementscomprise the consolidated statement of financialposition as at 31 December 2016 and the consolidatedstatements of profit and loss and other comprehensiveincome, changes in equity and cash flows for the yearthen ended, and notes, comprising a summary ofsignificant accounting policies and other explanatoryinformation. The total of the consolidated statement offinancial position amounts to EUR’000 839.660 and theconsolidated statement of profit or loss and othercomprehensive income shows a profit for the year ofEUR’000 66.241.

The statutory manager’s responsibility for thepreparation of the consolidated financial statementsThe Company’s statutory manager is responsible forthe preparation of these consolidated financialstatements that give a true and fair view in accordancewith International Financial Reporting Standards asadopted by the European Union, and with the legaland regulatory requirements applicable in Belgium,and for such internal control as the statutory managerdetermines, is necessary to enable the preparation ofconsolidated financial statements that are free frommaterial misstatement, whether due to fraud or error.

Statutory auditor’s responsibilityOur responsibility is to express an opinion on theseconsolidated financial statements based on our audit.We conducted our audit in accordance withInternational Standards on Auditing (ISAs) as adoptedin Belgium. Those standards require that we complywith ethical requirements and plan and perform theaudit to obtain reasonable assurance about whetherthe consolidated financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtainaudit evidence about the amounts and disclosures inthe consolidated financial statements. The proceduresselected depend on the statutory auditor’s judgment,including the assessment of the risks of materialmisstatement of the consolidated financial statements,whether due to fraud or error. In making those riskassessments, the statutory auditor considers internalcontrol relevant to the Company’s preparation and fairpresentation of the consolidated financial statementsin order to design audit procedures that areappropriate in the circumstances, but not for thepurpose of expressing an opinion on the effectivenessof the Group’s internal control. An audit also includesevaluating the appropriateness of accounting policiesused and the reasonableness of accounting estimatesmade by the statutory manager, as well as evaluatingthe overall presentation of the consolidated financialstatements.

We have obtained from the Company’s officials andthe statutory manager the explanations andinformation necessary for performing our audit.

We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for ourunqualified opinion.

Unqualified OpinionIn our opinion, the consolidated financial statementsgive a true and fair view of the Group’s equity andconsolidated financial position as at 31 December2016 and of its consolidated financial performance andits consolidated cash flows for the year then ended inaccordance with International Financial ReportingStandards as adopted by the European Union, andwith the legal and regulatory requirements applicablein Belgium.

Report on other legal and regulatory requirementsThe statutory manager is responsible for thepreparation and the content of the annual report onthe consolidated financial statements.

In the context of our mandate and in accordance withthe Belgian standard which is complementary to theInternational Standards on Auditing as applicable inBelgium, our responsibility is to verify, in all materialrespects, compliance with certain legal and regulatoryrequirements. On this basis, we provide the followingadditional statement which does not modify the scopeof our opinion on the consolidated financialstatements:

9 FINANCIAL REPORT


The annual report on the consolidated financialstatements includes the information required bylaw, is consistent with the consolidated financialstatements and does not present any materialinconsistencies with the information that webecame aware of during the performance of ourmandate.

•

Kontich, 7 March 2017

KPMG Statutory Auditor

Represented by

Filip De Bock

Bedrijfsrevisor

9FINANCIAL REPORT


STATUTORY STATEMENTSTATUTORY STATEMENT OF FINANCIAL POSITION(X € 1,000)

ASSETS31 DECEMBER

201531 DECEMBER

2016I. Non-current assetsC. Investment properties 753,626 802,191

753,626 802,191D. Other tangible assets 460 491E. Financial non-current assets

Assets available for saleReal estate certificates 0 0Investments in affiliated enterprises 10,329 10,298Amounts receivable from affiliated enterprises 11,442 9,834

G. Trade receivables and other non-current assets 0 022,231 20,623

II. Current assetsD. Trade receivables 6,235 8,779E. Tax receivables and other current assets 5,751 3,147F. Cash and cash equivalents 4,116 6,190

16,102 18,116Total assets 791,959 840,930

(X € 1,000)

SHAREHOLDER'S EQUITY31 DECEMBER

201531 DECEMBER

2016I. Shareholder's equity attributable to the parent company's shareholdersA. Capital 292,774 292,774B. Issue premiums 50,563 50,563C. Reservesb. Reserve for the balance of changes in fair value of real estate properties 107,943 116,456d. Reserve for the balance of changes in fair value of authorised hedging

instruments subject to hedge accounting -733 -808i. Reserve for the balance of changes in fair value of financial assets

available for sale 0 0j. Reserve for actuarial gains and losses of defined pension schemes -885 -809n. Accumulated result 70,288 76,604D. Net result of the year 48,832 68,627

568,782 603,407II. Minority interests 0 0

9 FINANCIAL REPORT


(X € 1,000)

LIABILITIES31 DECEMBER

201531 DECEMBER

2016I. Non-current liabilitiesA. Provisions

Pensions 1,132 1,089B. Non-current financial liabilitiesa. Credit institutions 110,000 140,000c. Other

Other loans 36,000 22,000Rent guarantees received 396 490

C. Other non-current financial liabilitiesAuthorised hedging intruments 733 808

E. Other non-current liabilities 0 16,447148,261 180,834

II. Current liabilitiesB. Current financial liabilitiesa. Credit institutions 63,000 45,200c. Other

Other loans 0 0Other 602 635

D. Trade payables and other current liabilitiesb. Other

Suppliers 6,024 5,554Taxes, remunerations and social security contributions 1,072 1,092

F. Accrued charges and deferred incomeReal estate income received in advance 1,970 1,360Other 2,248 2,848

74,916 56,689Total shareholder’s equity and liabilities 791,959 840,930

Net asset value per share (x € 1) 81.97 86.96

9FINANCIAL REPORT


STATUTORY PROFIT AND LOSS ACCOUNT(X € 1,000)

2015 2016I. Rental income

Rent 45,882 48,493Indemnification for early termination of lease 665 364Net rental income 46,547 48,857

V. Recovery of rental charges and taxes normally paid by the tenant on letproperties 1,439 1,646

VII. Rental charges and taxes normally paid by the tenant on let properties -1,779 -2,202-339 -556

Property result 46,208 48,301

IX. Technical costsRecurrent technical costsRepairs -351 -393Compensation for total guarantees -92 0Insurance premiums -40 -49

-483 -442X. Commercial costs

Agency commissions -370 -315Publicity -173 -284

-543 -599XI. Charges and taxes on non let properties

Costs on non let properties -727 -615Real estate tax on non let properties -184 -163

-910 -778XII. Property management costs

(Internal) property management costs -1,007 -813-1,007 -813

Property charges -2,943 -2,632Property operating results 43,265 45,669

XIV. General company costsStaff costs -623 -1,427Other -1,316 -2,027

XV. Other operating income and charges -265 -340-2,204 -3,794

Operating results before result on the portfolio 41,060 41,875

9 FINANCIAL REPORT


(X € 1,000)

2015 2016XVI. Result on disposals of investment properties

Net property sales (selling price – transaction costs) 0 0Book value of the property sold 0 0

0 0XVII. Result on disposals of other non financial assets

Net sales of other non financial assets (sale price - transaction costs) -4 -5

-4 -5XVIII. Variations in the fair value of investment properties


8,513 29,763XIX. Other result on portfolio -215 -116

-215 -1168,294 29,642

Operational result 49,354 71,517

XX. Financial incomeInterests and dividends received 552 -8Net results on disposals of financial assets 1,823 0

XXI. Net interest chargesNominal interest charges on loans -2,734 -2,147

XXII. Other financial chargesBank charges and other commissions -74 -88Net losses on disposals of financial assets 0 -512

XXIII. Variations in the fair value of financial assets and liabilitiesOther 0 0Financial result -432 -2,755Result before tax 48,922 68,762

XXIV. Corporate taxCorporate tax -90 -135Tax -90 -135Net result 48,832 68,627Result per share (x € 1) 7.04 9.89Diluted result per share (x € 1) 7.04 9.89

9FINANCIAL REPORT


STATEMENT OF COMPREHENSIVE INCOME(X € 1,000)

31 DECEMBER2015

31 DECEMBER2016

I. Net result 48,832 68,627

II. Other comprehensive incomeItems taken in the result

B. Changes in the effective part of the fair value of authorised cash flowhedge instruments as defined under IFRS -239 -75

C. Changes in the fair value of financial assets available for sale -565 0

Items not taken in the resultE. Actuarial gains and losses of pledged pension schemes 63 76

-741 1Comprehensive income (I + II) 48,091 68,628

9 FINANCIAL REPORT


Belle-Île

9FINANCIAL REPORT


STATUTORY STATEMENT OF MOVEMENTS IN EQUITY FOR 2016(X € 1,000)

NOTE SHARE CAPITAL ISSUE PREMIUMS LEGAL RESERVE

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF



Capital increase 26,614

Issue premiums 22,804



available for sale a



Other

Net result



properties -798

Dividend over 2014 b





available for sale



Other

Net result



properties 8,513

Dividend over 2015 c


9 FINANCIAL REPORT


(X € 1,000)

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF

AUTHORISED HEDGING

INSTRUMENTS SUBJECT

TO HEDGE ACCOUNTING

RESERVE FOR THE

BALANCE OF CHANGES

IN FAIR VALUE OF

FINANCIAL ASSETS

AVAILABLE FOR SALE

RESERVE FOR ACTUARIAL

GAINS AND LOSSES

OF DEFINED PENSION

SCHEMES OTHER RESERVES ACCUMULATED RESULT NET RESULT OF THE YEAR TOTAL

-494 565 -948 0 98,508 500,291

26,614

22,804

-239 -239

-565 -565

0

63 63

0

48,832 48,832

798

-29,018 -29,018

-733 0 -885 0 70,288 48,832 568,782

-733 0 -885 0 119,120 568,782

-75 -75

0

0

76 76

-2 -2

68,627 68,627

-34,001 -34,001

-808 0 -809 0 85,117 68,627 603,407

9FINANCIAL REPORT


Notesa Variations in the fair value of financial assets available for sale

Revaluation real estate certificates: -565b Dividend paid 2014

€ 4.60 (net € 3.45) per share: -29,018c Dividend paid 2015

€ 4.90 (net € 3.577) per share: -34,001

PROFIT APPROPRIATION (IN ACCORDANCE WITH THE SCHEDULE SET OUT IN SECTION 4 OFPART 1 CHAPTER 1 OF APPENDIX C FROM THE ROYAL DECREE OF 13 JULY 2014)

(X € 1,000)

31 DECEMBER2015 31 DECEMBER 2016

A. Net result 48,832 68,627

B. Transfer to/from reserves -8,513 -29,763Transfer to/from reserve for the balance of changes in fair value of real estate propertiesFinancial year -8,513 -29763

C. Return on capital 34,001 35,389(In accordance with article 13, §1, paragraph 1 from the Royal Decree of13 July 2014)

D. Return on capital, - other than C 0 0

The statutory annual accounts, the notes, the statutoryreport of the Management Company and the Auditor’sreport concerning the statutory annual accounts ofWereldhave Belgium can be obtained free of charge atthe Company’s Head Office. These documents are alsoavailable on our website:www.wereldhavebelgium.com

The auditor delivered an unqualified audit opinion.

The statutory annual accounts, the notes, the annualreport and the Auditor’s report will, according to thelegal regulations, be deposited at the National Bank ofBelgium.

9 FINANCIAL REPORT


Responsibility statement according to Section12 § 2 of the Royal Decree of 14 November 2007The Management Company of Wereldhave Belgiumdeclares:

that based on the assessment performed andtaking into account the recommendations of theCorporate Governance Code, the internal riskmanagement and control systems of WereldhaveBelgium are adequate and provide a reasonabledegree of certainty that the financial reporting asincluded in this Annual Report is free of materialmisstatement.The Management Company has no evidence thatthis risk management and control system would nothave functioned in accordance with the descriptionor that this system would not have functionedproperly in the current year;

1)

that the Annual Accounts present a true and fairview of the assets, liabilities, financial position andresult of Wereldhave Belgium;

2)

that the Annual Report provides a true and fair viewof the situation on the balance sheet date, thecourse of business during the financial year ofWereldhave Belgium;

3)

that the main risks confronting Wereldhave Belgiumhave been described in this Annual Report; and

4)

after taking into account every reasonable measurefor such purpose, that the information contained inthe Annual report reflects, to his knowledge, actualfact and no information has been omitted which, ifdisclosed, would alter the meaning of the Annualreport.

5)

The Management Company

Wereldhave Belgium NV

D. Goeminne, Chairman

J. de Smet

P. Naert

K. Deforche

D. Anbeek


9FINANCIAL REPORT


GENERALINFORMATION

10


IDENTIFICATION AND STATUTORY PROVISIONSNameThe Company is a public Regulated RealEstate Company (RREC) according to Belgianlaw.

On 8 April 2015 the name of the Companywas changed from ‘C.V.A. WereldhaveBelgium S.C.A.’ to ‘Wereldhave Belgium’.

Registered officeMedialaan 30, box 6 – 1800 Vilvoorde.

Company registration number (RPRBrussels)The Company is registered with theCrossroads Bank for Enterprises undernumber 0412.597.022.

TermThe Company was incorporated for anunlimited term.

Legal form, incorporation, publicationThe Company was incorporated, in the formof a public limited company and under thename ‘RANK CITY WALL (BELGIUM)’, bydeed executed by Mr Pierre Spaey, notary inSint-Jans-Molenbeek, on 8 August 1972,published in the annexes to the BelgianOfficial Gazette on 18 August 1972, undernumber 2520-9.

The Company was converted intoa partnership limited by shares by theextraordinary general meeting ofshareholders held on 15 January 1998, theminutes of which were drawn up by Mr EricSpruyt, notary of Brussels, and published inthe annexes to the Belgian Official Gazetteon 7 February 1998, under number980207-208.

As from 15 January 1998 the Company hasalso been known as a ‘property investmentfund with fixed capital under Belgian law’, orSICAFI under Belgian law, and registeredwith the FSMA. As a SICAFI, the Companywas subject to (i) the provisions of the RoyalDecree of 10 April 1995 relating to SICAFI’sand subsequently to the provisions of theRoyal Decree of 7 December 2010 relating toSICAFI’s (which repealed the aforementionedRoyal Decree of 10 April 1995), and (ii) to theprovisions of the Law of 20 July 2004 relatingto certain forms of collective management ofinvestment portfolios and subsequently tothe provisions of the Law of 3 August2012 relating to certain forms of collectivemanagement of investment portfolios (whichrepealed the aforementioned Law of 20 July2004).

10GENERAL INFORMATION


Taking into account the entry into force of theLaw of 19 April 2014 relating to alternativeinvestment funds and their managers(hereafter the AIFMD Law), the Companyopted to apply for the status of publicregulated real estate company, as introducedby the Law of 12 May 2014 relating toregulated real estate companies (hereafterthe RREC Law), in place of the status of publicSICAFI. In this context, on 8 August 2014 theCompany submitted its licence application asa public regulated real estate company to theFSMA. The Company was subsequentlylicensed as a public regulated real estatecompany by the FSMA on 22 September2014 in accordance with Articles 9, §3 and77 of the RREC Law, under the conditionprecedent of the amendment of the Articlesof Association of the Company and incompliance with the provisions of Article 77,§2 et seq. of the RREC Law. On 27 October2014, the extraordinary general meeting ofshareholders of the Company eventually andunanimously approved the change of theCompany object with a view to changingstatus from SICAFI to public regulated realestate company in accordance with the RRECLaw. As no right of withdrawal was exercisedat the aforementioned extraordinary generalmeeting of shareholders, and all conditionsprecedent to which the amendment of theArticles of Association was subject by theextraordinary general meeting ofshareholders and the licence granted by theFSMA had been met, since 27 October2014 the Company benefits from the statusof public regulated real estate company. TheCompany is of the understanding that thenew status of public regulated real estatecompany corresponds better to economicreality and provides an appropriate legalframework for the Company in its capacity asoperational and commercial real estatecompany. This status enables the Companyto continue its current activities in theinterests of the Company, its shareholdersand other stakeholders, and to position itselfconsistently as REIT (‘Real Estate InvestmentTrust’).

As a public regulated real estate company,the Company is no longer subject to theprovisions of the Royal Decree of7 December 2010 relating to SICAFI’s andthe Law of 3 August 2012 relating to certainforms of collective management ofinvestment portfolios, but since 27 October2014 the applicable regulations consist of theRREC Law and the RREC Royal Decree.

The Company is registered with the FSMA.

The Company is a public company thatinitiates a public offering as defined in Article438 of the Companies Code.

The Articles of Association of the Company(the Articles of Association) have beenamended on several occasions, inter alia asa result of:

Deed executed by Mr Frank Depuyt,notary in Sint-Jans- Molenbeek, standingin for his fellow notary Mr Hans Berquin ofBrussels, on 5 November 1987, publishedin the annexes to the Belgian OfficialGazette on 2 December 1987 undernumber 871202-114.

•

Deed executed by Mr Hans Berquin,notary in Brussels, on 13 December 1995,published in the annexes to the BelgianOfficial Gazette on 18 January 1996,under number 960118-488.

•

Deed executed by Mr Eric Spruyt, notaryin Brussels, on 14 January 1998,published in the annexes to the BelgianOfficial Gazette on 21 February 1998,under number 980211-344.

•

Deed (the name was changed to thepresent one and the public limitedcompany was converted intoa partnership limited by shares) executedby Mr Eric Spruyt, notary in Brussels, on15 January 1998, published in theannexes to the Belgian Official Gazette on7 February 1998, under number980207-208.

•

10 GENERAL INFORMATION


Deed executed by Mr Eric Spruyt, notaryin Brussels, on 16 January 1998,published in the annexes to the BelgianOfficial Gazette on 7 February 1998,under number 980207-209.

•

Deed executed by Mr Denis Deckers,notary in Brussels, on 14 May1999 (merger of the public limitedcompany ‘Groter Berchem’ and thelimited share partnership ‘WereldhaveBelgium’), published in the annexes to theBelgian Official Gazette on 8 June 1999,under number 990608-160.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, on 10 May 2002,published in the annexes to the BelgianOfficial Gazette on 5 July 2002, undernumber 20020705-537.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, on 13 April 2006,published in the annexes to the BelgianOfficial Gazette on 12 May 2006, undernumber 5068041.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, on 11 April 2007,followed by a deed establishing thefulfilment of the condition precedentdrawn up by Mr Denis Deckers, notary ofBrussels, on 12 November 2007,published in the annexes to the BelgianOfficial Gazette on 26 November 2007,under number 7168947.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, on 16 December2011 (among others, adoption of a newtext of the Articles of Association),published in the annexes to the BelgianOfficial Gazette on 27 January 2012,under number 025102.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, holder of the originalinstrument, with the assistance of Mr JanMuller, associate notary of Waasmunster,on 11 April 2012, published in theannexes to the Belgian Official Gazette on9 May 2012, under number 086309.

•

Minutes drawn up by Mr Denis Deckers,notary in Brussels, on 10 April 2013,published in the annexes to the BelgianOfficial Gazette on 6 May 2013, undernumber 69095.

•

Minutes drawn up by Ms Daisy Dekegel,associate notary in Brussels, on 9 April2014, published in the annexes to theBelgian Official Gazette on 24 April 2014,under number 20140424-87218.

•

Minutes drawn up by Ms Daisy Dekegel,associate notary in Brussels, on27 October 2014, published in theannexes to the Belgian Official Gazette on17 November 2014, under number20141117-0207907, followed by anamending deed executed by Ms DaisyDekegel, associate notary of Brussels, on13 January 2015, published in theannexes to the Belgian Official Gazette on3 February 2015, under number20150203-017996.

•

Minutes drawn up by Ms Nathalie Meert,associate notary in Antwerp, standing infor her colleague Ms Daisy Dekegel,associate notary of Brussels, who wasrestricted at territorial level, on 23 January2015, published in the annexes to theBelgian Official Gazette on 17 February2015, under number 20150217-025683,and this under the conditions precedent,the fulfillment of which was established bydeed executed by the aforesaid Ms DaisyDekegel on 16 February 2015, publishedin the annexes to the Belgian OfficialGazette on 10 March 2015, under number2015-03-10/0036809.

•

The Articles of Association were latelyamended by minutes drawn up by Ms DaisyDekegel, associate notary in Brussels, on8 April 2015 (inter alia change of thecompany name from ‘C.V.A. WERELDHAVEBELGIUM S.C.A.’ to ‘WERELDHAVEBELGIUM’), published in the annexes to theBelgian Official Gazette on 24 April 2015,under number 2015-04-24/0059754.



Financial yearThe financial year begins on 1 January andends on 31 December of each year.

Consultation of publicly accessibledocuments

The Articles of Association may beconsulted at the Clerk’s Office of theCommercial Court of Brussels and at theregistered office and on the website of theCompany;

•

The annual accounts are deposited withthe Central Balance Sheet Office of theNational Bank of Belgium;

•

Each year, the annual accounts andrelative reports are sent to the registeredshareholders as well as to any otherperson requesting a copy, and are may beconsulted on the website of theCompany;

•

Resolutions appointing and dismissingthe members of the Board of Directorsand the Manager are published in theannexes to the Belgian Official Gazette;

•

Financial statements and invitations togeneral meetings are published in thefinancial press.

•

Relevant public company documents areavailable on the website of the Company(www.wereldhavebelgium.com).

•

Other publicly accessible documents are maybe consulted at the registered office of theCompany.

Company purposeArticle 4 of the Articles of Association:

4.1 The exclusive purpose of the Company is:to make real estate available to users,directly or through a company in which itholds a participating interest, inaccordance with the provisions of theRREC Law and the decisions andregulations enacted in implementationthereof; and,

a.


Luchthavenlaan 1


within the limits of Article 7, b) of theRREC Law, to hold real estate assets listedin Article 2, 5°, vi to x of the RREC Law.Property within the meaning of Article 2,5° of the RREC Law is understood tomean:

b.

real estate as defined in Articles 517 etseq. of the Civil Code and the rights inrem over real estate, excluding realestate of a silvicultural, agricultural ormining nature;

i.

shares with voting rights issued by realestate companies under the exclusiveor joint control of the Company;

ii.

option rights on real estate;iii.shares in public or institutionalregulated real estate companies,provided that, in the latter case, jointor exclusive control is exercisedthereover by the Company;

iv.

rights arising from contracts wherebyone or more properties are financiallyleased to the Company, or othersimilar rights of use are granted;

v.

shares in public SICAFI’s;vi.shares in foreign collective propertyinvestment funds included on the listreferred to in Article 260 of the Law of19 April 2014 relating to alternativecollective investment funds and theirmanagers;

vii.

shares in collective propertyinvestment funds established inanother Member State of theEuropean Economic Area and notincluded on the list referred to inArticle 260 of the Law of 19 April2014 relating to alternative collectiveinvestment funds and their managers,to the extent that they are subject tothe equivalent supervision that isapplicable to SICAFI’s;

viii.



shares issued by companies (i) withlegal personality; (ii) under the laws ofanother member State of theEuropean Economic Area; (iii) theshares of which are admitted totrading on a regulated market and/orare subject to prudential supervision;(iv) the main activity of which consistsin the acquisition or building of realestate with a view to make it availableto users, or the direct or indirectholding of participation in companieswith a similar corporate purpose; (v)that are exempt from income tax onprofits in respect of the activityreferred to in the provision under (iv)above, subject to compliance withcertain legal requirements, and whichare at least required to distribute partof their income to their shareholders(hereafter ‘Real Estate InvestmentTrusts’ (abbreviated to ‘REITs’);

ix.

real estate certificates as referred to inArticle 5, §4 of the Law of 16 June2006 on the public offering ofinvestment vehicles and the admissionof investment vehicles to trading ona regulated market.

x.

Within the context of making real estateavailable, the Company can exercise allactivities associated with the construction,rebuilding, renovation, development,acquisition, disposal, management andoperation of real estate. The Companydevelops a strategy enabling it to positionitself in all stages of the value chain of the

property sector. To that end the Companyacquires and disposes of real estate andrights in rem pertaining to real estate withthe aim of making these available to its users.The Company can also manage thedevelopment (renovation, extension,construction, etc.) and ensure the day-to-daymanagement of the real estate in itspossession. It can be a trustee of a propertyheld in co-ownership or property manager ofa building complex where it is one of theowners. In this context it can also exercise allother activities that add value for its realestate or for its users (facility management,organisation of events, concierge services,conversion work adapted to the specificneeds of the tenant, etc.). The Company canalso offer tailored property solutions,whereby the properties are adapted to thespecific needs of their users.

To that end:the Company exercises its activities itself,without in any way delegating suchexercise to a third party other than anaffiliated Company, in accordance withArticles 19 and 34 of the RREC Law, asa result of which asset managementcannot therefore be delegated;

a.

it maintains direct relations with itscustomers and suppliers;

b.

with a view to exercising its activities in themanner described in this article, it hasoperational teams at its disposal thatconstitute a significant part of itsworkforce.

c.



4.2 The Company may invest additionally ortemporarily in securities that are not realestate in the sense of the applicablelegislation on regulated real estatecompanies. These investments shall be madein accordance with the risk managementpolicy adopted by the Company and shall bediversified, thus ensuring a suitablediversification of risk. The Company may alsohold unallocated liquid assets in allcurrencies in the form of deposits on currentaccounts and deposits on term accounts orin the form of any other easily negotiablemonetary instrument. The Company mayfurthermore enter into hedging transactions,provided these seek only to cover theinterest rate and exchange rate risk inconnection with the financing andmanagement of the Company’s property andto the exclusion of any operation ofa speculative nature.

4.3 The Company may lease or lease out oneor more properties (as referred to in the IFRSstandards). The activity of leasing out realestate with an option to purchase (as referredto in the IFRS standards) may only beexercised as an ancillary activity, unless thisreal estate is intended for an objective ofgeneral interest, including social housing andeducation (in this case the activity may beexercised as a principal activity).

4.4 The Company may also, in accordancewith the applicable regulations on regulatedreal estate companies:

provide mortgages or other collateral orguarantees in connection with thefinancing of the real estate activities of theCompany or its group, within the limitsdefined by Article 43 of the RREC Lawand the applicable regulations onregulated real estate companies;

•

grant loans to a subsidiary (the amountsowed to the Company as a result of thedisposal of real estate are not taken intoaccount here, provided they are paidwithin the usual deadlines) in accordancewith Article 42 of the RREC Law.

•

4.5 The Company may acquire, rent or let,transfer or exchange all movable orimmovable property, materials andrequisites, and in general, for itself or forthird parties, and in accordance with theapplicable regulations on regulated realestate companies, perform all commercial orfinancial transactions that are directly orindirectly related to its purpose, and maybecome involved with the operation of allintellectual property rights and commercialproperties pertaining thereto. With dueregard for the applicable regulations onregulated real estate companies, theCompany may, by way of contributions incash or in kind, by merger, split or othercorporate restructuring, subscription,participation, financial support or otherwise,take a share in all companies, either existingor yet to be established, in Belgium orabroad, the corporate purpose of which issimilar to its, or is likely to pursue or facilitatethe achievement of its purpose.

The prior consent of the FSMA is required forany amendment to the Articles of Associationof the Company.

Capital – Shares

Article 6 of the Articles of Association– CapitalThe authorized capital amounts to twohundred ninety-two million seven hundredseventy-three thousand seven hundred andseventy-eight euro fifty-one cents(€ 292,773,778.51). It is represented by sixmillion nine hundred thirty-nine thousandand seventeen (6,939,017) shares, with nonominal value, which each represent anequal portion of the capital.



Article 7 of the Articles of Association– Authorised capitalThe Management Company is expresslyauthorised to increase the fully paid-up socialcapital on the dates and under the terms andconditions determined by it, on one or moreoccasions, up to a maximum amount of twohundred and ninety-two million, sevenhundred and seventy-three thousand, sevenhundred and seventy-eight euros fifty-onecents (€ 292,773,778.51). In accordance withthe above mentioned Article 7 of the Statute,the Issuer's General Meeting can renew theaforementioned authorization regarding theauthorized capital.

The authorization to increase the sharecapital of the Company in one or more timesby a maximum amount of€ 292,773,778.51 was renewed by theextraordinary general meeting on 8 April2015, for a period of five years from the dateof publication of the decision in theAppendices to the Belgian Official Gazetteon the date of 24 April 2015. Theauthorization granted is valid until 24 April2020. In date of current annual report, theCompany has not yet made use of theaforementioned authorization.


Genk Shopping 1


Such capital increase(s) may be achieved bysubscriptions in cash or by contributions inkind or by the incorporation of reserves orissue premiums as well as all private assetsunder the separate IFRS annual accounts ofthe Company (drawn up pursuant to theapplicable regulations on regulated realestate companies) that are convertable intocapital, whether or not attached to anothersecurity, which may give rise to the creationof shares with or without voting right, inaccordance with the rules prescribed by theCompanies Code, the applicable regulationson regulated real estate companies andthese Articles of Association. Thisauthorisation is granted for a period of fiveyears from the date of publication in theannexes to the Belgian Official Gazette of theminutes of the relevant authorising decisionof the general meeting.

This authorisation is renewable.

For each capital increase the ManagementCompany establishes the price, any issue

premium and the terms and conditions ofissue of the new shares, unless the generalmeeting takes such decisions itself. TheManagement Company may also issue newshares with the same or different rights(including in relation to voting rights,dividend rights – including possibletransferability of any preference dividend– and/or rights relating to the liquidationbalance and any preference in relation to therepayment of capital) as the existing sharesand in that connection amend the Articles ofAssociation to express any such differentrights.

Article 8 of the Articles of Association – Typeof SharesThe shares of the Company (the Shares) areregistered or dematerialised. Eachshareholder of the Company may request theManagement Company, at his/her expense,the conversion of these Shares intodematerialised Shares.


Tournai


Upon written request of a shareholder of theCompany, the Management Company shallconvert the dematerialised Shares intoregistered Shares.

The conversion of the dematerialised Sharesto registered Shares shall take place throughan entry into the register of registeredShares, dated and signed by the shareholderor his/her representative and by theManagement Company of the Company orspecial proxy.

The dematerialised share is represented byan entry into the account, in the holder’sname at a recognised account holder or thesettlement institution.

The Share entered on account is transferredby transfer from account to account.

For each category of Share, the number ofdematerialised Shares in circulation at anytime is entered into the register of registeredShares in the name of the settlementinstitution.

Conversion to dematerialised Shares may berequested as soon as the Company hasappointed a settlement institution.

Article 10 of the Articles of Association– Repurchase of own SharesUnder Article 10 of the Articles ofAssociation, the Company may acquire andhold in pledge its own Shares that have beenfully paid up in cash pursuant to the decisionof the general meeting deliberating inaccordance with the quorum for attendanceand majority provided for in Article 559 ofthe Companies Code and in accordance withthe rules set down in Article 620 et seq. and630 of the Companies Code. The same

general meeting may define the terms andconditions for the disposal of these shares.

Article 13 of the Articles of Association– Disclosure of major holdingsIn accordance with the terms and conditions,time limits and modalities specified inArticles 6 to 13 of the Law of 2 May 2007 onthe disclosure of major holdings in issuerswhose shares are admitted to trading ona regulated market, and the Royal Decree of14 February 2008 on the disclosure of majorholdings, as amended from time to time (theTransparency Legislation), any natural orlegal person must disclose to the Companyand to the FSMA the number and percentageof existing voting rights held by him/herdirectly or indirectly, when the number ofvoting rights reaches, exceeds or falls short of5%, 10%, 15%, 20%, etc., in consecutiveinstallments of 5%, of the total of existingvoting rights, under the terms and conditionsspecified by the Transparency Legislation.

Management and Representation

Article 14 of the Articles of Association– Appointment – Dismissal – VacancyThe Company is managed by one or moremanagement companies, which must havethe capacity of limited (managing) partner.

Is appointed managing company for anindefinite period: the public limitedcompany ‘N.V. WERELDHAVE BELGIUMS.A.’ (incorporated deed executed by Mr EricSpuyt, notary, on 6 January 1998 and whichacquired legal personality as a result ofregistration on 7 January 1998), withregistered office currently located atMedialaan 30, box 6, 1800 Vilvoorde.



To perform its duties, the ManagementCompany is represented by the persons who,pursuant to the Articles of Association andthe law, may bind it for acts of management,in this case the Board of Directors. Inaccordance with the provisions of Article13 of the RREC Law, the Board of Directors ofthe Management Company is composedsuch that the Company can be managed inaccordance with Article 4 of the RREC Law. Inaddition, at least three independent directorsas defined by Article 526ter of theCompanies Code must be appointed in theBoard of Directors of the ManagementCompany.

The Management Company is organised insuch a way that, depending on the chosenpolicy structure, the Management Companyor the Company itself satisfies the provisionsof Article 17 of the RREC Law. The membersof the Management Company’s Board ofDirectors, the Executive Managers, and thoseresponsible for the independent auditfunctions, must be natural persons.

However, Article 39 of the Articles ofAssociation provides that pursuant to Article109 of the RREC Law, legal persons thatperform a function as a member of the Boardof Directors of the Management Company ofa public regulated real estate company onthe date the RREC Law enters into force areauthorized to exercise their current mandateuntil its expiry. Until the aforementionedexpiry, Article 14, §1, paragraph 2 of theRREC Law applies to the permanentrepresentative.

The persons referred to in the previoussentence must at all times maintain therequired professional integrity and adequateexpertise and experience required to carryout their duties, as stipulated by Article 14,§1 of the RREC Law. They may not be subjectto the prohibitions referred to in Article 20 ofthe Law of 25 April 2014 on the status andcontrol of credit institutions.

The Executive Management of the Companymust be entrusted to at least two naturalpersons.

Article 16.2 of the Articles of Association– Advisory CommitteesIn accordance with Articles 522, 526bis and526quater of the Companies Code, themanagement companies, if there is morethan one, or the Board of Directors of theManagement Company, may establish one ormore advisory committees in their (its) midstand under their (its) responsibility, such as,for example, a strategic committee, an AuditCommittee, an appointments committee anda remuneration committee. In any event theBoard of Directors of the ManagementCompany must establish an Audit Committeeand a remuneration committee in its midstand under its responsibility as soon as theCompany no longer satisfies the criteriaimposed in Article 526bis, §3 of theCompanies Code or Article 526quater, §4 ofthe Companies Code. The ManagementCompany determines the composition andduties of these committees, with dueconsideration for the applicable regulations.

Article 20 of the Articles of Association– AuditThe auditing of the Company is entrusted toone or more statutory auditors. The mandateof statutory auditor may only be entrusted toone or more qualified auditors or one ormore audit companies accredited by theFSMA. The prior consent of the FSMA isrequired to appoint statutory auditors to theCompany. This consent is also required forthe renewal of a mandate.



General Meeting

Article 21 of the Articles of Association– Ordinary, special and extraordinary generalmeetingsThe ordinary General Meeting ofshareholders, known as the annual meeting,shall take place every year at 11 a.m. on thesecond Wednesday of April. If this day isa public holiday, the meeting is held at thesame time on the next working day.

A special General Meeting may be convenedat any time to deliberate and decide on anymatter that falls within its competence.

An extraordinary General Meeting may alsobe convened at any time to deliberate anddecide on any amendment to the Articles ofAssociation, in the presence of a Notary.

General Meetings are held at the registeredoffice of the Company or at another locationin Belgium specified in the notice.

Article 24 of the Articles of Association– Admission – Depositing of securitiesA Shareholder may only participate in theGeneral Meeting and exercise a voting rightif the requirements following are satisfied:

A Shareholder may only participate in theGeneral Meeting and exercise a votingright by virtue of the recording in theaccounts of the registered shares of theShareholder, on the record date, eitherthrough entry in the register of registeredShares of the Company or through theirentry in the accounts of an authorizedaccount holder or a settlement institution,irrespective of the number of Shares heldby the Shareholder at the GeneralMeeting. The fourteenth day prior to theGeneral Meeting, at midnight (Belgiantime), counts as the record date.

1)

Owners of dematerialised Shares whowish to participate in the General Meetingmust produce a certificate issued by theirsettlement institution or authorizedaccount holder and showing how manydematerialised Shares are entered in theiraccounts in the name of the Shareholderon the record date, and for which theShareholder has indicated a desire toparticipate in the General Meeting. Thissubmission must be made no later thanon the sixth day prior to the date of theGeneral Meeting at the registered officeor with the institutions specified in thenotice. Owners of registered Shares whowish to participate in the General Meetingmust inform the Company of theirintention to participate in the GeneralMeeting by ordinary letter, fax or email nolater than on the sixth day prior to thedate of the General Meeting.

2)

The Management Company shall keepa register for each shareholder havingnotified his/her desire to participate in theGeneral Meeting, in which his/her nameand address or registered office arerecorded, the number of Shares held onthe record date, and with which he/shehas indicated a desire to participate in theGeneral Meeting, together witha description of the documents that showthat he/she was in possession of theShares on that record date.

3)

Article 28 of the Articles of Association– Voting rightsEach Share entitles its holder to one vote.

If one or more Shares are jointly owned byseveral people or by a legal person witha joint body of representation, the attachedrights may only be exercised vis-à-vis theCompany by a single person appointed inwriting to do so. Until such an appointmenthas been made, all rights attached to theShares remain suspended.



If a Share is encumbered by a usufruct, thevoting right attached to that Share isexercised by the usufructuary, subject toa prior objection in writing by the bareowner.

Company records – distribution

Article 31 of the Articles of Association– distributionBy way of remuneration of the capital, theCompany allocates profits in accordance withand pursuant to Article 45 of the RREC Law.

PERSON RESPONSIBLE FOR THE CONTENT OF THE REGISTRATIONThe Company, represented by itsManagement Company which, itself, isrepresented by its Board of Directors, isresponsible for the content of the registrationdocument. Having taken all reasonable careto ensure that such is the case, the

Management Company hereby declares thatthe information contained in this registrationdocument is, to the best of its knowledge, inaccordance with the facts and contains noomission likely to affect its import.

STATUTORY AUDITOROn 13 April 2016, KPMG Bedrijfsrevisoren,Burgerlijke vennootschap o.v.v. BCVBA, withIBR membership B00001, represented byFilip De Bock with IBR membership A01913,with offices at Prins Boudewijnlaan 24d,B-2550 Kontich, with company number0419.122.548 was appointed as statutoryauditor of the company for a period of threeyears that will end immediately after theannual general meeting to be held in

2019 that will approve the financialstatements at 31 December 2018. (1) (2)

The fees relating to audit activities amountedin 2016 € 91,250 excl. VAT, those relating toaudit-related activities € 8,000 excl. VAT andon non-audit activities € 10,515 excl. VAT forthe period running from 1 January 2016 until31 December 2016. No other fees were paid.

REAL ESTATE EXPERTSAs of 31 December 2016, the real estateexperts of the Company are:

Cushman & Wakefield, with registeredoffice at Kunstlaan 56, 1000 Brussels,represented by Jérôme Lits/Ardalan Azari.(1) (2)

•

Mandate: 1 January 2015 – 31 December2017Segment shopping centres.Annual fee: € 81,131 (excl. VAT)

Troostwijk Roux Expertises, withregistered office at GeneraalLemanstraat 58, box 2, 2600 Antwerp,represented by Karl Speybrouck MRE.(1) (2)

•

Mandate: 1 January 2014 – 31 December2016Segment offices.Annual fee: € 35,100 (excl. VAT)



In accordance with the RREC legislation, theindependent external real estate expertsvalue the investment properties portfolio ona quarterly basis. The fees are fixed ona lump-sum basis and are calculated basedon a fixed amount per building.

The statutory Management Company ofthe Company also declares that thestatutory auditor and real estate expertshave agreed to the contents of both theirreport and their conclusions beingincluded in the Annual Report and thatthey have agreed to the content and formof and the context within which thesection concerned is included in theAnnual Report.

1)

The Company declares that theinformation provided by the experts andthe statutory auditor was accuratelycarried over. Insofar as the Companyknows and has been able to establishfrom the information published by theexperts and the statutory auditor, no factwas omitted that might render thereproduction of the information providedby the experts and the statutory auditorincorrect or misleading.

2)



PROPERTY MANAGERSWereldhave Belgium Services NV, withregistered offices at Medialaan 30, box 6,1800 Vilvoorde, with company registrationnumber 0422.120.838, acts as real estatemanager for the investment propertiesportfolio.

99.52% of the shares of Wereldhave BelgiumServices are held by the Company. The feesin favour of Wereldhave Belgium Services arecharged directly to the tenants in accordancewith the contractual terms and conditionsdescribed in the rental agreements.

Wereldhave Belgium Services has anadministrative, accounting, financial andtechnical organisation that is appropriate formanaging the real estate portfolio of theCompany.

The directors of Wereldhave BelgiumServices possess the required professionalintegrity, accreditation (BIV) and appropriateexpertise as described and in accordancewith Article 19 of the RREC Law.

INTERNAL AUDITORIn 2014 JP Advisory Services BVBA, withregistered office at Prinsenstraat 41,1850 Grimbergen, represented by JohnPuttemans, was appointed for internal auditmatters. The service agreement covers:

Preparing the audit charter•Preparing an audit plan•Implementing the audit plan•


Belle-Île


The annual fee is set a fixed sum of€ 10,000 (excl. VAT).

FINANCIAL SERVICE PROVIDER: BNP PARIBAS FORTISBNP Paribas Fortis is charged with providingthe Company with financial services.

This includes, among other things, thefinancial service of the Company, thefinancial services relating to the payment of

dividends, and the settlement of securitiesissued by the Company.

The annual fee is set a fixed sum of€ 3,000 (excl. VAT).

EXTERNAL LEGAL ADVISERSInteralia, the Company utilises external legaladvisers for:

Complex dossiers (purchase, sale,merger)

•

Due diligence matters•New implementation of legislation•

The fee is set on the basis of market rates.

INFORMATION RELATED TO THE ANNUAL FINANCIAL REPORT 2014 AND2015

Consolidated accounts 2014: p. 93 to p.141 of the annual financial report 2014

•

Management report over 2014 : p. 20 to p.70 of the annual financial report 2014

•

Auditor’s report over 2014: p. 142 to p.145 of the annual financial report 2014

•

Consolidated accounts 2015: p. 114 to p.167 of the annual financial report 2015

•

Management report over 2015 : p. 66 top. 79 of the annual financial report 2015

•

Auditor’s report over 2015: p. 168 to p.169 of the annual financial report 2015

•



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11


GLOSSARY AND ALTERNATIVEPERFORMANCE STANDARDS

11


GLOSSARYAlternative performance standards arecriteria employed by ‘Wereldhave Belgium’to measure and monitor its operationalperformance. These criteria are used in this2016 Annual Report to Shareholders but arenot defined in a law or in generally acceptedaccounting principles (GAAP). The EuropeanSecurities and Markets Authority (ESMA) hasissued guidelines (effective as from 3 July2016) for the use and explanation ofalternative performance standards. The basicconcepts of what Wereldhave Belgiumregards as an ‘alternative performancestandard’ are incorporated in this section ofthe 2016 Annual report to Shareholders,entitled ‘Glosssary and alternativeperformance standards”. The alternativeperformance standards are marked with anasterisk (*) and provided with a definition,objective and reconciliation, as required bythe ESMA guideline.

Annual Financial ReportThe consolidated annual report of the Boardof Directors.

Audit CommitteeThe Audit Committee of the Company asappointed by the Board of Directors inaccordance with Article 526bis of theCompanies Code.

Average interest rate on loans *The average interest rate on the financing ofthe Company is calculated by dividing netinterest expense (annualized) by theweighted average debt for the period (basedon the daily recordings of all interest-bearingliabilities.

Objective: The average interest rate on thefinancing measures the average financingcost of debt and allows it to follow theevolution over time, depending on theevolution of the company and the financialmarkets. (Reconciliation See note 25)

Bo-Bi Framework (Business Objects– Business Intelligence Framework)This application gives the Company theopportunity to construct reports with a fixedlayout from data from various sources,together with a qualitative test of these data.

Board of DirectorsThe Board of Directors of the ManagementCompany.

BREEAM (Building Research EstablishmentEnvironmental Assessment Method)Method of assessing the environmentalperformance of buildings (www.breeam.org).

CG StatementThe ‘corporate governance’ chapter of theAnnual Financial Report.

ChairmanThe Chairman of the Board of Directors.

Closed PeriodMeans one of the following periods:

the period 2 months prior to thepublication of the annual results of theCompany, or a Listed Shareholding, or, ifthe annual results are published withina period of less than 2 months after theend of the financial year, the period fromthe end of the financial year up to andincluding the date of publication;

i.

the period one month prior to theannouncement of the six-monthly orquarterly results of the Company, ora Listed Shareholding, or, if the results areannounced within a period of less thanone month after the end of the relevantperiod, the period from the end of theperiod up to and including the date ofannouncement.

ii.

CompanyThe partnership limited by sharesWereldhave Belgium, with companyregistration number 0412.597.022.

11GLOSSARY AND ALTERNATIVE PERFORMANCE STANDARDS


Compliance OfficerRefers to the Person appointed by theCompany in order to focus as anindependent function within the organisationon the investigation into, and the promotionof, compliance by the company with laws,regulations and codes of conduct applicableto the Company and in particular the rulesrelating to the integrity of the activities of theCompany (including the management of thepolicy relating to avoiding transactions withprior knowledge and the application of theprovisions of this policy as well as checkingthe associated procedure).

The Company has appointed Mr LaurentTrenson (employee of the Company andactive as a senior accountant) as ComplianceOfficer.

Contractual rentThe rental prices as contractually specified inthe rental agreements on the date ofconclusion, prior to deduction of rentaldiscounts or other benefits granted to thetenants.

Corporate Governance CodeIs the Belgian Corporate Governance Codeof 12 March 2009, available atwww.corporategovernancecommittee.be,which contains a series of rules and practicesrelating to corporate governance to becomplied with by companies under Belgianlaw, the shares of which are traded ona regulated market, which determine howcompanies are managed and audited inorder to promote a corporate strategy that isbased on a contribution to long-term value.

Debt ratioThe debt ratio is calculated as the ratio of allobligations (excluding provisions, adjustmentaccounts, deferred taxes and negativevariations in the fair value of hedginginstruments) in relation to the total assets.

Derived products – DerivativesDerived products – derivatives give theCompany the opportunity to cover itselfagainst any short-term increase in interestrates.

This interest rate risk can be covered toa limited extent by using derived products(the purchase of CAP, possibly with the saleof FLOOR; IRS contracts).

DeveloperThe persons who exclusively or jointly controlan RREC in the sense of Article 2, 13° of theRREC Law, the promotor Wereldhave NV.

DirectorEach director of the Management Company.

Due DiligenceProcedure aimed at a complete and certifiedinventory of a company, a building or a realestate portfolio (accounting, economic, legal,tax aspects, etc.) prior to a financing oracquisition.

EmployeeEach Director or member of staff of theCompany appointed by the supervisor who isdeemed capable of bearing price-sensitiveinformation.

Executive ManagersPersons charged with the executivemanagement of the Company who togetherform the executive management and who arealso the executive managers in the sense ofthe RREC Law as well as Executive Managers.Under the RREC Law, the executivemanagement of the Company must beentrusted to at least two natural persons.

11 GLOSSARY AND ALTERNATIVE PERFORMANCE STANDARDS


EPRA and EPRA terminologyEPRA (European Public Real EstateAssociation) is an organization that promotesEuropean listed property sector, helpsdevelop and represents in order to boostconfidence in the sector and to increaseinvestment in listed real estate in Europe. InDecember 2014 EPRA's Reporting andAccounting Committee updated the EPRABest Practices Recommendations ("BPR") 1.This BPR contain recommendationsconcerning the determination of keyperformance indicators for the performanceof the portfolio. A number of these indicatorsare considered to be alternative performancemeasures in accordance with the ESMA-directive. The numerical reconciliation ofthese alternative performance measures canbe found in a completely separate section ofthis report (Chapter 6)

EPRA Europe indexEuropean stock market index (excluding theUK) of the FTSE EPRA/NAREIT Global RealEstate. The index consists of property valuesthat are representative of the listed realestate sector in Europe. It was created byEPRA.

EPRA OccupancyThe EPRA occupancy is calculated as the ratiobetween the contractual rental income(contractual rental income as of report dateand signed contracts that start within the yearafter the report date) and this same rentalincome increased by the estimated rentalvalue of the unoccupied rental locations.

ERVAbbreviation of Estimated Rental Value.

Fair ValueRetail value of property investmentsaccording to the IAS/IFRS 13 accountingstandards, i.e. after deducting transactioncosts, as determined by the real estateexperts.


Gent Overpoort


FBI (Fiscaal beleggingsinstelling – Taxinvestment institution)Tax system in the Netherlands, comparablewith the RREC system.

Financial InstrumentMeans any value or any right belonging toone of the following categories:

capital-representing shares and othervalues equivalent to shares;

i.

bonds and other debt instrumentstradable on the capital market;

ii.

all other normally traded values withwhich the values referred to in (i) or (ii) canbe acquired or which are settled in cash,excluding means of payment;

iii.

rights of participation in collectiveinvestment funds;

iv.

instruments that are normally traded onthe financial market;

v.

financial futures, including equivalentinstruments settled in cash;

vi.

forward rate agreements;vii.interest rate and currency swaps andswaps relating to cash flows linked toshares or to share indexes (equity swaps);

viii.

currency and interest rate options andother options to acquire or dispose of anyfinancial instrument referred to in (i) to(viii), including equivalent instrumentssettled in cash.

ix.

Free FloatPercentage of the shares owned by thepublic. On Euronext the free float iscalculated as the total amount of sharecapital less the shares held by companiesthat are part of the same group, state-ownedenterprises, and founders.

FSMAThe Financial Services and Markets Authority– the former Banking, Finance and InsuranceCommission (BFIC).

The autonomous regulatory authority forfinancial markets and services in Belgium.


Roderveldlaan 96


General Meeting of ShareholdersIs the general meeting of shareholders asprovided for by the Articles of Association ofthe Company.

GLAGross lettable area.

IAS 39IAS 39 is an IAS/IFRS standard on the waya company must arrange and value itsfinancial instruments in its balance sheet. Thisstandard requires all derived instruments tobe processed in the balance sheet at their fairvalue.

IAS/IFRS (IAS, International AccountingStandards/IFRS, International FinancialReporting Standards)The international accounting standards forpreparing the annual accounts, produced bythe International Accounting StandardsBoard (IASB).

IFRS standardsInternational Financial Reporting Standards.Set of accounting principles and valuationrules produced by the InternationalAccounting Standards Board. The aim is tomake international comparison easierbetween European listed companies.

Independent internal audit functionAn independent assessment function aimedat examining and assessing the properfunctioning, effectiveness and efficiency ofthe processes, procedures and activities ofthe Company.

The Company has entrusted the internalaudit function to an external legal personthrough the appointment of an independentconsultant, namely JP Advisory ServicesBVBA, represented by its permanentrepresentative, John Puttemans.

InsiderPerson who has access to price-sensitiveinformation.

Insider KnowledgeEach undisclosed piece of information that isaccurate and relates directly or indirectly tothe Company and/or one or more of itsListed Participation (specifically a companyaffiliated with the Company or a ListedParticipation) or to one or more FinancialInstruments of the Company, and which, ifdisclosed, could significantly affect the priceof these Financial Instruments or that ofrelated financial instruments, as is furtherexplained in Annex 6 to the CorporateGovernance Charter.

KPIKey Performance Indicators are variables forevaluating performances.

LeaseholdTemporary right that grants full enjoyment ofa building that belongs to someone else, andfor which an annual fee must be paid (canon)to the owner in recognition of his/her right ofownership. In Belgium, the right of leaseholdmust be entered into for at least 27 and notmore than 99 years.

Like for like (Epra) net rental growth *Like for like (Epra) net rental growth atconstant composition of the portfoliocompares the growth in net rental incomefrom real estate investments throughout theperiod were available for lease, and not indevelopment, and this for the two full yearspreceding the closing date of the financialyear. The changes in gross rental income ona like-for-like basis, providing insight into thechanges in gross rental income that do notresult from changes in the property portfolio(investments, disvestments, major renovation,...).

Objective: To measure the cost of thefinancing sources, and the potential impacton the results. The APM also allows forhistorical analysis.

(Reconciliation See note 25)



Listed ShareholdingIs a Subsidiary or a listed shareholding.

Management CompanyThe statutory management company of theCompany, currently Wereldhave Belgium NV(managing partner of the Company), withregistered office at Medialaan 30, box 6,1800 Vilvoorde, with company registrationnumber 0462.347.431.

Managing DirectorsThe Managers charged with the dailymanagement of the Company who togetherform the executive management and who arealso the Executive Managers in the sense ofthe RREC Law charged with the executivemanagement of the Company.

Market rentThe expected rent that can be contractedwhen letting.

Net dividendThe net dividend is equal to the grossdividend less the withholding tax. Decreeddividends made payable after 1 January2017 are (subject to certain exemptions)liable to a withholding tax of 30% instead of27% (Program law of 25 December2016 published in the Belgian OfficialGazette State Journal of 29 December 2016).

Net result from core activities *The net result from core activities is theoperating result before the portfolio resultminus the financial result and taxation, andexcluding variations in the fair value offinancial derivatives (that are not treated ashedge accounting in accordance with IAS 39)and other non-distributable items on thebasis of the company financial statements ofWereldhave Belgium.



Objective: The net result from core activitiesmeasures the result of the strategicoperational activities, excluding (i) thevariations in the fair value of financial assetsand liabilities (non-effective hedges), and (ii)the portfolio result (the profit (or loss)) that itturned in (or not) on property investments).This amounts, essentially, to the profit (orloss) that is directly affected by the property-and financial management of the company,excluding the impact ascribed to volatilityeffects in property- and financial markets.(Reconciliation, see Explanatory Note No. 4).

Net result from core activities per share *The net result from core activities per share isthe result (the profit (or loss)) divided by theweighted average number of ordinary sharesin issue at year-end.

Objective: The net result from core activitiesper share measures the result per ordinaryshare ranking for dividend and enablesa comparison with the gross dividend perordinary share.

(Reconciliation, see Explanatory Note No. 4)

Net result from non-core activities (portfolioresult) *The result from non-core activities (portfolioresult) comprises (i) the result on sale ofproperty investments, (ii) the variations in thefair value of property investments, and (iii) theother portfolio result.

The result from non-core activities (portfolioresult) measures the realised (and unrealised)gains and losses on the propertyinvestments, compared to the valuation ofthe independent property valuers as at theend of the previous financial year

(Reconciliation, see Explanatory Note No. 4)


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Net result per shareThe net result per share is calculated bydividing the net result (as shown by theincome statement) by the weighted averageof the number of shares (i.e. the total numberof issued shares minus the entity’s ownshares) during the financial year.

(Reconciliation, see heading ‘Consolidatedprofit and loss account’, p. 150)

Net value (fair value) per shareTotal net equity attributable to shareholdersof the parent company (i.e. after deductingthe minority shareholdings) divided by thenumber of shares at year-end (and afterdeducting the entity’s own shares, ifapplicable). It corresponds to the net value asdefined in section 2, 23° of the (regulatedreal estate companies) Act.

The net value (fair value) per share measuresthe value of the share based on the fair valueof the property investments and makesa comparison with the share price possible.

OccupancyThe occupancy is calculated by dividing the(indexed) contractual rental prices of thecurrent rental contracts by the sum of thecontractual rental prices and the estimatedrental values (market rents) of the vacancies.The latter is established based on the level ofcurrent rental prices on the market.

Real Estate certificateReal Estate certificates are tangible valuesrepresenting debt claims that giveentitlement to a proportional part of theincome from a specific property. The payablecoupons include an income part and a capitalamortisation part.

REIT (Real Estate Investment Trust)Listed real estate investment fund in theUnited States.

Risk OfficerThe person charged with the riskmanagement function who is responsible for,among other things, drawing up, developingand monitoring, updating and implementingthe risk management policy and the riskmanagement procedure. The Company hasappointed Mr Laurent Trenson (employee ofthe Company and active as a senioraccountant) as Risk Officer.

RREC LawThe Law of 12 May 2014 relating to regulatedreal estate companies.

RREC Royal DecreeThe Royal Decree of 13 July 2014 relating toregulated real estate companies.

ShareholdersAll the shareholders of the Company.

Statutory AuditorIs/(Are) the statutory auditor(s) of theCompany, as provided for by Article 130 etseq. of the Companies Code, to which theexternal auditing of the Company isentrusted.

Interest Rate SwapInter-bank rate.

Take-upUse of the areas intended for letting.

Wereldhave GroupThe company under Dutch law WereldhaveN.V., with registered office at WTC SchipholTower A, 3rd floor, Schiphol Boulevard 233,1118 BH Schiphol, Netherlands (andcompanies affiliated to it).

Withholding TaxTax withheld by a bank or financialintermediary on payment of a dividend.



Comm. VA Wereldhave Belgium SCAMedialaan 30/6, B-1800 VilvoordeT +32 2 732 19 00, F +32 2 732 21 80

[email protected]

www.wereldhavebelgium.com


Documents

2016 - Wereldhave Belgium