WORKSPACE GROUP PLC

Preliminary Results

For the year ended

31 March 2005

Headline results

• Valuation Surplus £67m 10.4%

• Total Property Valuation £718m Up 14.3%

• Net Asset Value per share £2.24 Up 21.7%

• Turnover £55.0m Up 7.8%

• Trading pre-tax profit £14.5m Up 2.6%

• Trading EPS per share 6.3p Up 3.3%

• Profit before Tax £14.4m Down 4.7%

• Annual Rent Roll £42.3m Up 11%

• Gearing 88%

• Dividend 3.41p Up 10%

Ten Year Results

Five Year Ten YearCompound Growth Compound Growth

Trading PBT 11.7% 19.6%

Trading EPS 9.5% 12.1%

Dividend per share 10.2% 13.1%

Net Assets (per share) 19.9% 21.6%

Property at Valuation 18.7% 24.2%

The Business – A Simple Model

To achieve profit and capital growth from:

• Providing workspace to SMEs

• Investing in properties with potential- Income growth- Capital growth- Alternative use

• Increasing scale of portfolio, spreading overheads and developing the brand

• The right financial platform

Our Business – A Reminder

“ We provide affordable, flexible space for new and small businesses in London and the South East ”

• c.4,000 customers over 103 estates; 5.2 million sq .ft

• Over 7,700 enquiries a year; market leading brand in fragmented market

• A simple product offer

• Superior service from in-house management

• Customer focused

Customer Profile

Median % of median

turnover Year of start 1996 —

Turnover £250,000 —

Overheads £90,000 36

Profits £40,000 16

Rent £12,000 4.8

Typical Workspace tenant:

Rent under 5% of turnover

Source: Kingston University survey of over 200 customers. Spring 2004

Total Percentage of Customers by DTI Categories

DTI Classification of Tenants

12% 1%

2%

1%

6%

18%

45%

10%

5%

Manufacture

Retail

Cons truction

Utilities /Infras tructure

Organisations

Des ign & Creative

Services

Storage & Dis tribution

Unclass ified

Trading: Occupancy & Rents

• Continuing occupancy improvements

31 March - core occupancy 90.5%- overall occupancy 88.3%- 46% estates at occupancy of 95%+

• 7,764 enquiries in year; 1,012 lettings

• Occupancy improving at Barley Mow and Quality Court

• Like-for-like average rents up 2.9% (from £8.57 to £8,82)

• Rolling rent review/lease renewals programme on 5.8% opening rent roll secured 16.7% uplift on previous passing rentals

Acquisitions & Disposals

Acquisitions

Quadrangle, Fulham, SW6

Southbank House, SE1

Southgate Office Village, N14

Chiswick Studios, W4

Lombard House, Croydon

Lewis House, Park Royal, NW10

Homesdale Business Centre, Bromley

Total £43.4m

Net Yield 7.3%

Disposals

Hooley Lane, Redhill

Union Street Sites, SE1

Three Mills, E3

£34.8m

2.5%

Recent Acquisitions

The Quadrangle, SW6 Chiswick Studios, W4 Southgate Office Village, N14

Southbank House, SE1 Homesdale Business Centre, Bromley

Lombard House, Croydon

Progress on Major Refurbishments

Enterprise Extension, refurbishment and sub-division of space to create enlarged business centre (£6m costs)

Clerkenwell Major extension and refurbishment of centre. (£7m build costs)

Southbank Full refurbishment of external envelope, internal M&E etc, partial refurbishment and sub division (£2.1m costs)

Progress on Adding Value: Changes of Use

• Wharf Road Planning consent achieved. Replacement of 43,000 sq. ft business centre with 77 residential units and new 32,500 sq. ft business centre

• Thurston Road 46,400 sq. ft industrial estate to be replaced by 75,000 sq. ft retail warehouse and up to 290

residential units

• Aberdeen StudiosPlanning application in for replacement of existing centre 65,000 sq. ft and up to 96

residential units

• Greenheath Planning consent being sought for replacement of existing business centre and 100 residential units

• Longer Term Work

2005 Results: P & L Account

Trading

2004

£m

Trading

Operations

£m

Other

£m

Total

2005

£m

Turnover 51.1 55.0 - 55.0

Rent Payable and direct costs (14.3) (14.1) - (14.1)

Administrative Expenses (7.1) (7.7) - (7.7)

Operating Profit 29.7 33.2 - 33.2

Surplus on disposal of investment properties - - (0.1) (0.1)

Net interest payable (15.6) (18.8) - (18.8)

Profit before tax 14.1 14.4 (0.1) 14.3

Tax (4.3) (4.2) - (4.2)

Profit after Tax 9.8 10.2 (0.1) 10.1

Basic earnings per share 6.1p 6.3p (0.1)p 6.2p

Diluted earnings per share 6.0p 6.2p (0.1)p 6.1p

2005 Results: Balance Sheet31/03/2005

£m

31/03/2004(restated)

£m

Investment Properties 715.8 626.1

Other Assets 8.9 10.5

Creditors (excluding borrowings) (31.0) (29.6)

Funding: Short Term Borrowings (0.8) (1.3)

Long Term Borrowings (321.7) (305.8)

Cash and Investments 1.3 1.2

Deferred Tax Provision (7.4) (5.4)

Net Worth 365.1 295.7

NAV Per Share £2.24 £1.84

Net Borrowings (322.5) (307.1)

Gearing 88% 104%

Immediate Investment Capacity = £49.2m (Gearing 102%) (£115.6m to 120%)

Key Elements on Valuation

• Income up 4.1%, ERV up 3.3% (like-for-like)

• ERV £57.6m; 90% ERV = £51.8m; Current net rental income £42.3m

• Net initial yield 5.9%, reversionary yield 8.0%, equivalent yield 7.1%

• Valuation surplus after £14.3m impact of stamp duty change

• Valuation surplus: 40% rent, 60% yield

• Capital value £139 per sq. ft

IPD Performance

Total Return (p.a.) One

Year

Three

Years

Five

Years

Ten

Years

Workspace Group 17.5% 15.2% 16.8% 18.5%

IPD March Universe 16.7% 12.6% 11.0% 11.5%

Workspace Group

Percentile Rank

IPD Comparator

54

15.6%

23

9.6%

1

9.5%

Top

11.1%

Benchmarks Performance

Internal Benchmark comparison shows:

Performance Measures

2005 2004 2003 2002 2001

Turnover per member of staff (£000) 380 332 314 294 272

Year-end investment in property per member of staff (£000)

5,006 4,092 3,261 2,984 2,581

Administration costs as a percentage of revenue

13.9% 13.9% 14.6% 15.3% 13.8%

Total return on equity 27.1% 26.2% 15.0% 20.6% 40.7%

International Financial Reporting Standards

• First impacts annual accounts to 31 March 2006

• Continued quarterly reporting

• Q1 August – External Valuation

• Impact on EPS and NAV computations

(deferred tax, valuation surpluses, financial instruments)

REITs

• Origin of Group – earnings focus with high

dividend distribution.

• On right terms, Group may fit into a REIT

environment.

• Recent consultation document - thoughts

Looking Forward: The Same Business Model

• As stated September 2003 - 5% per annum rental increases

- No movement in yields/occupancy

- Conservative gearing- Annual investment £50m - £60m

• Aim: - Doubling value in 5 years to September 2008 - £1bn portfolio

• On track

Looking Forward: Occupancy and Rents

• SME confidence

• The London Economy

• Short and Longer Term

See: Investor Relations/Company Presentationssection of www.workspacegroup.co.uk

Recent Trends - Starts

During 2004, London & South East continue

to lead the way in business starts 2004

Per 1,000 of working age

London 92.8 19

South East 71.4 15

North West 52.8 13

South West 49.0 17

East 44.0 13

West Midlands 36.8 11

Yorkshire 35.6 12

East Midlands 33.8 13

Wales 21.1 12

North East 15.7 10

Source: Barclays ‘Starts and Closures’ 2004

Recent Trends – Starts (2)

Rise in starts across the Capital during 2004,

Though down slightly across the South East

2003 2004 % Change

London 79,700 92,800 +16%

South East 73,000 71,400 -2%

Total 400,000 453,000 +13%

Source: Barclays ‘Starts and Closures’ 2004

SME ProspectsExpected change during first quarter of 2005

(Q1 2005 on Q4 2004)

42

15

18

29

32

65

60

25

8

15

7

75

0% 20% 40% 60% 80% 100%

Sales Turnover

AverageEmployment

Investment

Selling Prices

Up Same Down

Source: SERT, ‘Quarterly Survey of Small Businesses in Britain’, Q1 2005

Other Longer Term Features

• Olympics – decision 6 July

• Regeneration Areas

• Infrastructure Improvements: Crossrail, East London Line.

• Tracking of acquisition targets – our database

• Stepping up the added value programme – 45% of estates

Priorities and Performance

Priorities Performance

Deliver enhanced shareholder value

To improve occupancy to 90%

To continue with a further £60m acquisitions in a year

Continue to identify and implement added value schemes

Strengthen brand awareness as Leader in marketplace

NAV up 21.7%, EPS up 3.3%, TSR 34% per annum over last 5 years

Occupancy 90%

Acquisitions - £43m / Disposals - £35m

Planning/sale achieved: Hooley/Union StPlanning achieved: Wharf RoadGood Planning Progress: Aberdeen, Thurston Road

Re-launch of Group website, continued link with Kingston University.

7,764 enquiries, 1,012 new lettings

Summary

• Good enquiry levels; occupancy high and robust

• Rental focus in 2005/06

• Added value programme gaining momentum

• Business plan on target

• Growth opportunities

Workspace – Leader in a Growing Marketplace

APPENDIX

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Workspace FTSE Allshare FTSE Smallcap FTSE Realestate FTSE 250