The golden mile

Success in city retail

DE BELEGGERSCLUB HEUSDEN Qrf Update H1 2015

ON SCHEDULE

1I Introducing Qrf

2I City Retail because…

3I Acquisition strategy and activities

4I Portfolio management

5I Accomplishments of 1H 2015

6I The share ‘Qrf’

7I Key portfolio statistics

8I Conclusion

1I INTRODUCING QRF

QRF IS A BELGIAN FIXED-CAPITAL REAL ESTATE INVESTMENT TRUST AND LISTED ON EURONEXT BRUSSELS (QRF:BB) AS OF DECEMBER 2013

4

5

QRF WAS FOUNDED IN 2013. IT AROSE FROM A FORMER SUCCESFULL RETAIL FUND THAT WAS MANAGED BY QUARES

Quares stands for Quality Real Estate Services. Quares is a real estate specialist operating in Belgium, the Netherlands, Luxembourg, Germany and France.

Management team

6

ANNELEEN DESMYTER CEO

PREBEN BRUGGEMAN CFO

BERT WEEMAES COO

• Founding Partner of Quares

• Founded CC Company NV, currently Quares Residential Agency, in 2004

• Formerly project developer in corporate real estate for Eurinpro

Retail experience with Quares Retail Fund, Quares Retail Fund 2 and the bond issue for the acquisition of the high street shopping centre Century Center Antwerpen

• Previously active on capital markets operations and M&A transactions in the real estate sector at Bank Degroof

• Prior equity analyst at Bank Degroof covering the listed real estate sector

• Former director at City Mall, a real estate retail developer

• Previously held positions as member of the Board, CFO and Development & Real Estate Director at Decathlon Benelux

Retail experience with k Kortrijk, Les Grands Prés Mons expansion and Shopping Le Côté Verre Namur and the expansion of Decathlon Benelux

With years of experience in Retail Real Estate

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WE INVEST IN, (RE)DEVELOP AND RENT OUT PRIME RETAIL REAL ESTATE IN THE ‘GOLDEN MILE’ OF BELGIAN CITIES

INVESTORS IN RETAIL REAL ESTATE

2I CITY RETAIL BECAUSE…

… urbanisation

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KEY DRIVERS:

• Vibrant social & cultural life

• Mobility & destination proximity

• Economic activity & employment

… population growth

10

0,95

1

1,05

1,1

1,15

1,2

1,25

1,3

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Antwerpen Mechelen Beringen

Genk Hasselt Aalst

Dendermonde Gent Sint-Niklaas

Leuven Brugge Kortrijk

Oostende Roeselare Turnhout

Brussels Hoofdstedelijk Gewest

Population growth in the 15 largest flemish cities and brussels Source: Belgian FOD Economie & Studiedienst Vlaamse Regering

… the city shopping experience

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• An authentic shopping experience

• A healthy mix of fun & run, leisure, food & drinks, …

• A fun combination of types of stores, brands, chains versus local

… city shopping is fun shopping

12 Source: Vlerick, “City Centres become more and more popular”, 2012

36%

45%

51%

56%

30%

43%

0% 10% 20% 30% 40% 50% 60%

50+

35-50 year

18-34 year

woman

man

total

I like to go shopping for fun - % (totally) agrees

… we choose to shop in the city

13

47%

35%

28%

13%

8%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

the centre of the city (near) where I live

the centre of the city (near) where I work

a shopping centre outside or on the edge of a city

a website where I can order online

an out-of-town store

How many times do you shop with a clear purpose in any of these locations? A clear purpose means that you go shopping because you have planned to buy

something sustainable (shoes, jacket, dvd, …) - % (very) often

Source: Vlerick, “City Centres become more and more popular”, 2012

… supporting government policies

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• Investment budgets for city retail locations

• City managers

• Government policies promote city retail

… the future and value of omni-channel

15 Source: CBRE Global Investors, 2014

- Webshop, mobile site, store are individual channels

- E-commerce is threat

- No data interaction between channels

- Channels cross, but…

- Generating traffic to store remains first priority

- Few data interaction

- Not store-, but customer-centric view

- Path-to-purchase interchangeable

- Posibilities to perform data-analysis

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3I ACQUISITION STRATEGY & ACTIVITIES

Acquisition strategy: real estate criteria

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• Quality and accessibility of the assets

• Quality of the tenants and the underlying rental contracts

• Clear focus to adherence to laws and regulations

• Re-rental potential of the property

Asset type - Focus on high quality retail

properties on city locations

Location - Located in high streets that

are dominant for their catchment area

- i.e. the golden mile in catchment areas of > 50,000 consumers

Attractive locations

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• Streets with high footfall in Belgian cities with catchment area of min. 50,000

• Cities with an active city development and marketing policy

• Support of expansion plans & introduction in Belgian market

• Strong portfolio growth

Golden mile as a preferred location

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• Must-have location

• Growing rents

• Scarcity

• Solid liquidity

Acquisition strategy: financial criteria

22

• Sustainable contribution to the earnings per share and dividend policy

Investment size - Strong growth ambitions

Leverage ratio - Overall leverage ratio of

maximum 55%

Straight-forward

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Portfolio with potential

4I PORTFOLIO MANAGEMENT

Active portfolio management

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Property improvement

Dialogue with stakeholders

Anticipation on retail markets of tomorrow

Creativity team

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HERMAN KONINGS

TINA DEBO

SASKIA SCHATTEMAN

• Manager of trend and future research bureau Pocket Marketing / nXt.

• VP Product and Design for Kipling

• Member of the board with NMBS

• Former CMO Lead for Microsoft and former Vice President with Telenet.

Advisory group on the marketing and positioning of Qrf in regards to current and future retail, e-commerce and city shopping trends

5I ACCOMPLISHMENTS OF 1H 2015

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Focus on Belgian inner-city retail properties that are dominant in their catchment area • 8% portfolio growth in 1H 2015 • Resulting in 537 KEUR additional yearly rent • The part of inner-city real estate increases to 75%

Mai

n h

igh

ligh

ts

Diversified in terms of tenants, individual asset size and geographical spread

• Acquisitions in Gent, Oudenaarde, Antwerp and Namur with a nice tenant mix: Esprit, Armand Thiery, Gerry Weber, ...

Sustainability and social responsibility • Establishing sustainable relationships with stakeholders • Being attentive to environmental impact • Supporting young artists which promote the inner-city

1H 2015 Highlights

Active portfolio management • 2 renewals of rental contracts with rental increase • 0 rental contracts ended • Several pop-up stores

Capital increase • Contribution in kind of 2 retail properties located in Antwerp

& Namur • 193,097 new issued shares • Increasing the shareholders’ equity by 4.73 MEUR

Resulting in acquisitions on 4 locations

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Gent

Oudenaarde

Namur

Antwerpen

Investment value of approx.

11 MEUR

Acquisitions in 1H 2015

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Date of

transaction

City Street Tenant(s) GLA Contractual

rents on annual

basis

April 21, 2015 Oudenaarde Nederstraat 43-45 Esprit (Jomi

BVBA)

1,228 m² 150 KEUR

May 27, 2015 Gent Lange Munt 61-63 Gerry Weber 638 m² 132 KEUR

June 24, 2015 Namen Rue de Fer 10 Armand Thiery 192 m² 180 KEUR

June 24, 2015 Antwerpen Kammenstraat 34 Dstrezzed 161 m² 75 KEUR

TOTAL 537 KEUR KEU

September 2015: Acquisition Aalst

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Aalst, Nieuwstraat 29-33

- 7,080 m² GLA

- 33 m’ frontage

- 77 parking lots on roof

Acquisition yield of approx. 5.75%

978 KEUR annual rental income

Investment Value of approx. 17.0 MEUR

6I THE SHARE ‘QRF’

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Qrf share

34

Evolution of stock price and NAV Key data per share

Per share data (in EUR) 30.06.2015 30.12.2014 30.06.2014

Total number of shares

outstanding 3 466 008 3 272 911 3 272 911

Closing price 25,04 25,90 24,46

Market capitalisation 86 788 840 84 768 395 80 055 403

NAV (IFRS) 22,71 23,13 22,64

Premium to NAV (IFRS) 10,3% 12,0% 8,0%

NAV (EPRA) 23,58 23,87 23,23

Premium to NAV (EPRA) 6,2% 8,5% 5,3%

-

200

400

600

800

1.000

1.200

1.400

1.600

1.800

2.000

20,0

21,0

22,0

23,0

24,0

25,0

26,0

27,0

28,0

29,0

30,0

Volume per dag Stock Price NAV per share (IFRS)

(in EUR) (in KEUR)

Dividend guidance

• Expected gross dividend for FY 2015 of at

least 1,30 EUR

• Gross dividend yield of 5,2% (1)

(1) Based on closing price as of 30 June 2015

Qrf - An interesting investment opportunity

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CITY RETAIL

2 Focus on high street in prime and regional cities

3 Offering solid risk-return profile 4 Quality of

underlying portfolio

5 Steered by experienced and motivated management team

1 Resilient retail market

Goal: 1,3 EUR Gross Dividend per share (= 0,975 Net per share)

7I KEY PORTFOLIO STATISTICS

Well-spread tenant base

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FASHION

51%

6%

6%

5%

4%

4%

4%

3%

3%

3%

3% 2% 2% 2%

Sectoral spread (% Contractual rents on annual basis)

Fashion (H&M, Bershka, G-Star, …)

Sport & Leisure (HEMA, Neckerman, Oxygen,Standaard, ..)Interior & Decoration (Casa, Euro Center, …)

Horeca (Panos, Mc'Donalds, …)

Car (Citroën)

Electro & Telecom (Van den Borre, Phone House, …)

Parking

Jewelry (Twice as Nice, ...)

Beautycare (Kruidvat, Hans Anders, …)

Garden & do-it-yourself (Brico, …)

Office articles (Ava papierwaren, …)

Shoes (Torfs, Tamaris, Janelli, …)

Food (Lidl, …)

Varia

Well-spread tenant base

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FASHION

11,9%

5,4%

4,5%

4,3%

3,7%

3,4%

3,4%

2,4%

2,2%

H&M

Sissy Boy

Citroën

Bershka

Apcoa

Piocheur

Esprit

C&A

Mc DONALD'S

Tenant spread (% Contractual rents on annual basis)

High and stable occupancy rate

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96,8%

96,0% 96,2%

99,5% 99,7%

99,0%

90%

91%

92%

93%

94%

95%

96%

97%

98%

99%

100%

30/12/2013 30/12/2014 30/06/2015

Occupancy rate (excl. rental guarantees on vacant property) Occupancy rate

Portfolio valuation

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FASHION

Real estate portfolio (in K EUR) 30.06.2015 30.12.2014 30.12.2013

Fair value of the real estate portfolio 150 228 139 218 114 201

Gross rental surface (in m²) 60 248 58 029 51 730

Gross portfolio yield (incl. rental guarantees on vacant property) 6,1% 6,2% 6,2%

Gross portfolio yield (excl. rental guarantees on vacant property) 6,0% 6,0% 6,1%

Occupancy rate 99,0% 99,7% 99,5%

Occupancy rate (excl. rental guarantees on vacant property) 96,2% 96,0% 96,8%

43%

15%

13%

11%

5%

5%

3% 2% 2% 2%

Geographical spread per province (% Fair Value)

Antwerp

Liège

East Flanders

Limburg

Brussels CapitalRegionFlemish Brabant

Luxembourg

Namur

74%

21%

6%

Geographical spread per region (% Fair Value)

Flanders

Wallonia

Brussels

Evolution of the Fair Value of the portfolio

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114,2 MEUR

129,4 MEUR

139,2 MEUR

150,2 MEUR

167,0 MEUR

66%

71%

73%

75%

77%

0,0 MEUR

20,0 MEUR

40,0 MEUR

60,0 MEUR

80,0 MEUR

100,0 MEUR

120,0 MEUR

140,0 MEUR

160,0 MEUR

180,0 MEUR

30/12/2013 30/06/2014 30/12/2014 30/06/2015 30/06/2015 + ACQ Aalst

Fair Value % inner-city

8I CONCLUSION: A VALUED PARTNER

Expectations on 2015

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2 Diversification in regional and main cities in Belgium

3 Straight-forward operating 4 Further growth by acquisitions

5 Sustaining dividend level

1 Focus on Golden Mile

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QUESTIONS?

THANK YOU