Instone Real Estate Group AG

Investor Presentation • May 8, 2018

FY 2017 RESULTS PRESENTATION

MAY 2018

Today's Speakers

Kruno Crepulja Chief Executive Officer since 2008

• Joined Instone's predecessor in 2008
• CEO since 2008
• 21 years experience in real estate development
• Previously Managing Director of Wilma Wohnen Süd GmbH from 2003 to 2008

Oliver Schmitt Chief Financial Officer since 2010

• Joined Instone's predecessor in 1984
• CFO since 2010
• 33 years experience in construction and real estate development

Highlights

• We are fully in line with market consensus for FY 2017
• Adjusted revenues of €201m
• Gross profit margin(1) of 39.6%
• Adjusted(2) EBIT of €45m
• Adjusted(2) ROCE of 14.3%
• Post money net financial debt of €215m
• We are positive for FY 2018 and confirm our medium-term plan
• Our project pipeline remains strong with €3.4bn and we are close to signing of 4 new projects
• Acquisition potential of >€13bn GDV is the fundament for sustainable profitable growth
• We are well on track with project executions and construction cost being 0.5%(3) below budget (1) Pre PPA, inxcl. Sales commissions, (2) Pre PPA; (3) for the period 1.10.17-3.05.18

Reconciliation of reported and adjusted results FY-17A	Commentary
In €m	Reported Results	PPA amortization	Transaction costs	Adjusted Results
Total revenue	199.7	1.7		201.4
Changes in inventories	120.2	21.4		141.6
Operating performance	319.9	23.1		343.0
Other operating income Cost of materials Staff costs Other operating expenses Income from associated affiliates Other net income from investments EBITDA	5.4 (244.8) (49.5) (41.5) 0.2 (0.1) (10.4)	23.1	7.6 22.4 2.3 32.3	12.9 (244.8) (27.1) (39.2) 0.2 (0.1) 45.0
Depreciation and amortization	(0.4)			(0.4)
EBIT	(10.8)	23.1	32.3	44.6
Finance result	(20.4)			(20.4)
EBT	(31.2)	23.1	32.3	24.2
Income taxes	0.2	(7.0)		(6.7)
Net income	(31.0)	16.1	32.3	17.5

• PPA for the acquisition of formart in 2014 resulted in a write-up of current assets of €36.4m, an increase of liabilities of €7.8m and deferred tax liabilities of €9.0m. PPA for the acquisition of GRK in 2015 resulted in a write-up of current assets of €107.7m and an increase of deferred tax liabilities of €30.8m. PPA is amortized over the next years (€10.6m in 2015, €49.1m in 2016 and €23.1m in 2017)
• The former majority shareholders have exempted the company from transactionrelated personnel costs and administrative expenses with a cost-sharing agreement and an indemnification agreement. For this reason, the company received reimbursements of €32.3 million.
• €7.6m relates to personnel expenses in previous years for payments in connection with a long-term incentive scheme relating to the transaction
• €22.4m relates to personnel expenses in the actual year for payments in connection with a long-term incentive scheme relating to the transaction
• €2.3m relates to administrative expenses in the actual year for payments to third parties relating to the transaction
• The management board invested 70% of its LTIP in company shares with a lock period (terms are part of the prospectus)
• With respect to gross profit¹ , the group has reached a value of €56.7m in 2017. Taking into account the adjustments from PPA, the gross profit (pre PPA) would be €79.7m for the year under review.

We are positive for FY 2018 ...

• Revenues of €320-330m (with sales recognition being largely back-ended during the year)
• Operative performance of >€500m
• Gross profit margin(1) of approximately 28%
• Adjusted(2) EBIT of €42-48m
• Adjusted(2) EBT of €25-30m
• Stable tax rate of approximately 30%

(1) Pre PPA, incl. Sales commissions, (2) Pre PPA

...and confirm our Medium Term Plan

Target annual sales volume €900 – 1,000m	Target annual delivery volume	>2,000 units
	(1) Target gross margin (including sales commissions)	~25%
Target platform costs ~€50m (2) (includes all overheads between gross profit and adj. EBITDA pre PPA)
Cost of debt as % of gross debt ~7%
Tax rate ~30%
Target inventory ~€1.5bn
Target NWC as % of sales volume ~60% Source: Management estimates.

Note: Financial outlook prepared excluding impact of PPA amortization.

PPA impacts not only EBIT but also inventories and operating performance.

(1) ~29% excluding sales commissions.

(2) Without staff cost inflation.

Our project portfolio remains strong

• €3.4bn expected sales volume
• 8,390 units
• 45 projects
• ~45% of portfolio in Frankfurt and NRW
• 24% of portfolio under construction

(Project portfolio as of 31.12.2017)

Project execution well on track

"Wilhelm IX" in Wiesbaden Sold at 60%	$\blacksquare$ Project size: Sales volume:	$~150$ units $\sim \epsilon$ 89m	■ Construction start: Expected completion:	2017 2019
"Teemanufaktur" in Halle Start of marketing expected in May	$\blacksquare$ Project size: Sales volume:	$\sim$ 208 units $\sim \epsilon$ 25m	■ Construction start: Expected completion:	2018 2020
"NMA" in Hamburg Construction completed of building section 2; Handover of apartments	$\blacksquare$ Project size: Sales volume:	$\sim$ 280 units $\sim \epsilon$ 145m	$\blacksquare$ Construction start: Expected completion:	2015 2018
"Westside" in Bonn Block sales of ~280 rental units	Buyer: $\blacksquare$ Notary deed:	Large pension trust Sale of 160 units notarised in May	Signed memorandum of understanding for sale of remaining units
"Marie" in Frankfurt Marketing launch for condominiums Expected total sales volume of ~€210m (vs BNP valuation of €179m)	Project size: Sales volume:	$\sim$ 240 units $\sim \epsilon$ 210m	Construction start: Expected completion:	2017 2021
"Franklin" in Mannheim Construction start for condominiums being sold at 50%	Project size: Sales volume:	$\sim$ 240 units $\sim \epsilon$ 70m	Construction start: Expected completion:	2018 2020
"Luisenpark" in Berlin Building section 1 sold at 90%	Project size: ш $\blacksquare$ Sales volume:	$\sim$ 560 units $\sim \epsilon$ 230m	Construction start: Expected completion:	2017 2020

Identified aquisition potential of >€13.0bn(1) GDV is the fundament for sustainable profitable growth

We are filling up the pipeline, ensuring future growth

• Close to signing of 4 new projects
• Total expected sales volume of ~€470m
• Total units of ~1,340
• Total living space of ~103,000 sqm

To summarize

Profitable Growth	Fully delivered on FY17 in line with market consensus Our well-located €3.4bn(1) project portfolio is the basis for our profitable growth Strong acquisition potential >€13.0bn(2) and continue to fill up our pipeline
Top Quality Platform	Leading nationwide platform with potential for scalability Deep and committed bench of management professionals Excellent execution track record and rigorous risk management
Attractive Market	Fast-growing German metropolitan housing markets Structural housing need with material unmatched demand Favourable regulatory framework leading to attractive cash flow profile

11 | (1) Based on expected sales volume for ongoing projects when fully developed; as of 31 Decemberr 2017 (2) Near- to long-term identified potential acquisition opportunities as of 31 December 2017.

APPENDIX

ADDITIONAL FINANCIAL INFORMATION (PAGES 13-18) ADDITIONAL COMPANY INFORMATION (PAGES 20-47)

Income statement Commentary

In €m	2016A	2017A
Total revenue	203.6	199.7
Changes in inventories	158.9	120.2
1 Operating performance	362.5	319.9

	Other operating income	8.3	5.4
2	Cost of materials	(293.7)	(244.8)
3	Staff costs	(35.2)	(49.5)
	Other operating expenses	(42.4)	(41.5)
	Income from associated affiliates	1.3	0.2
	Other net income from investments	0.3	(0.1)
	EBITDA (reported)	1.3	(10.4)
	Depreciation and amortization	(0.4)	(0.4)
	EBIT (reported)	0.8	(10.8)
	Finance income	0.1	0.6
	Finance costs	(25.0)	(21.0)
	Write-down of long-term securities	0.1	0.0
	Finance result	(24.8)	(20.4)
	EBT (reported)	(24.0)	(31.2)
4	Income taxes	1.8	0.2
	Net income (reported)	(22.2)	(31.0)

1

Operating performance consists of booked revenues from realized projects as well as change in inventories due to projects currently ramping up

Only when a project is completed 4-5 years following the start date are the corresponding revenues booked in the P&L. In years prior to completion, only change in inventories and costs impact the P&L

Change in inventories is the project-specific capitalized/value appreciation in inventories (assets on balance sheet), effectively the cost of land acquisition + capitalized development costs + capitalized project-related interest expenses + pro rata capitalized platform costs

Marketing expenses (and some minor operating expenses) cannot be capitalized and thus directly impact the P&L

• The decrease of cost of materials in 2017 by €48.9 million to €244.8 million (2016: €293.7 million) corresponded mainly to the decrease of the consolidated operating performance. This decrease was due to a decline in construction work for multiannual project developments compared to the previous year. 2
• Staff costs increased in 2017 primarily due to liabilities for special payments in connection with a long-term incentive scheme in the amount of ~€22m (2016: ~€9m) 3
• Income tax improves the consolidated result. This is primarily due to the release of deferred tax liabilities for the valuation reserves and PPA in the amount of €15.3m (2016: €12.6m) which offset expenses from corporate income taxes and trade taxes. 4

13 | Source: Audited historical financials, Company information.

Summary historical financials

• 14 | Source: Company information, audited historical financials
• (1) Operating performance defined as revenue plus net change in inventories.
• (2) Based on reported EBIT pre PPA amortization and revenue pre PPA amortization.
• (3) Percentage of completion, completed contract.

In $\epsilon$ m	2016A	2017A
Consolidated earnings	(22.2)	(31.0)
Depreciation and amortization	0.4	0.4
Increase / decrease of provisions	15.0	12.5
Increase / decrease of deferred taxes	(12.9)	(15.7)
Decrease / increase of equity carrying amounts	(1.3)	1.0
Decrease/increase other financial assets	0.0	0.3
Other non-cash income and expenses	23.5	31.2
Profit / loss on disposals of property, plant and equipment	0.0	0.0
Decrease / increase of inventories, trade receivables and other assets	(25.6)	(112.3)
Increase / decrease of trade payables and other liabilities	116.9	83.4
Cash flow from operating activities	93.8	(30.2)
Income taxes paid	(6.2)	(4.2)
Net cash flow from operating activities	87.7	(34.5)
Proceeds from disposals of property, plant and equipment	0.0	0.0
Purchase of property, plant and equipment	(0.4)	(0.5)
Proceeds from disposals of non-current financial assets	0.3	0.0
Payments for acquisitions of shares in consolidated companies	(22.0)	(22.8)
Receipts from the disposal of subsidiaries	0.2	0.1
Acquisition of non-consolidated subsidiaries	(0.0)	(0.0)
Interest received	0.1	0.6
Cash flow from investing activities	(21.8)	(22.7)
Increase of issued capital incl contributions to capital reserves	0.0	0.0
Payout to non-controlling interests	0.0	(0.7)
Cash proceeds from shareholder loans	0.0	0.0
Cash proceeds from borrowings	64.4	121.9
Cash repayments of borrowings	(38.3)	(88.3)
Interest paid	(17.6)	(14.8)
Cash flow from financing activities	8.5	18.2

15 | Source: Audited historical financials, Company information.

.

Balance sheet (1/2) Commentary

In €m

	2016A	2017A
Intangible assets	0.0	0.0
Tangible assets	1.5	1.6
Investments accounted for using the equity method	1.4	0.4
Other financial assets	0.7	0.3
Financial receivables	0.7	0.7
Non-current assets	4.3	4.0

8	Inventories	542.7	659.4
9	Financial receivables	0.2	32.4
	Trade receivables	19.6	4.2
	Other receivables and other assets	5.6	15.5
	Income tax assets	0.3	0.0
	Cash and cash equivalents	112.5	73.6
	Current assets	680.9	785.1
	Total assets	685.2	789.1

Source: Audited historical financials, Company information.

8 Inventories partially comprised of unfinished products from ongoing development projects. Due to the first-time consolidation of Instone Real Estate Development GmbH in 2014 and Instone Real Estate Leipzig GmbH in 2015, inventories as of 31 December 2017 still included €50.5 million (31 December 2016: €71.9 million) stepups from the purchase price allocations.

9 The current financial receivables of €32.4 million (prior year: €0.2 million) resulted in receivables to associated companies. These included €32.3 million receivables to the majority shareholders for the indemnity of other operating expenses and personnel costs relating to the planned private placement and the Company's listing on the Frankfurt Stock Exchange. These receivables were based on a cost-sharing and indemnity agreement and an indemnification agreement.

Balance sheet (2/2) Commentary

10

11

In €m 2016A 2017A Share capital 0.0 0.0 Capital reserve 37.4 85.4 Retained earnings / loss carryforwards (35.5) (34.3) Other equity components (1.3) (0.3) Equity attributable to shareholders 0.7 50.7 Non-controlling interests 2.0 1.5 Total equity 2.7 52.2

Provisions for pensions and similar obligations 4.1 4.2 Other provisions 12.4 1.3 Financial liabilities 300.9 241.0 Other liabilities 0.0 0.0 Deferred tax liabilities 23.4 7.7 Non-current liabilities 340.9 254.2 Other provisions 25.6 49.2 Financial liabilities 81.6 134.7 Trade payables 215.2 275.7 Other liabilities 13.1 9.4 Income tax liabilities 6.2 13.8 Current liabilities 341.7 482.7 Total equity and liabilities 685.2 789.1

Non-current financial liabilities for the financial year 2017 were reduced to €241.0 million (2016: €300.9 million). €48.0 million of the liabilities towards the shareholders of Instone Real Estate Group N.V. were converted into equity in 2017. During the year 2017, interests were capitalised, so that at the end of 2017, the liabilities to shareholders still amounted to €57.8 million (2016: €96.6 million). Instone Real Estate Development GmbH was able to sustainably improve its liquidity by first-time placement of a promissory note loan worth €66.9 million. The non-current financial liabilities to banks for project related financing decreased during the reporting year. 10

Trade payables increased to €275.7 million in the financial year 2017 (2016: €215.2 million). This was primarily due to the capitalisation of the upfront payments. These amounted to €230.4 million received for new sales of condominiums or further instalments according to the ongoing construction of sold condominiums that were attributed as inventories. 11

Net financial debt computation

ADDITIONAL COMPANY INFORMATON

The Instone opportunity:

Note: Key metropolitan regions include Berlin, Cologne, Dusseldorf, Frankfurt, Hamburg, Leipzig, Munich, Stuttgart.

(1) For Germany's key metropolitan regions, based on average purchase prices for new units as reported by Bulwiengesa. (2) Bulwiengesa, Potential Analysis German Housing Market, compiled for Instone Real Estate GmbH ("Instone") as of 24 October 2017.

(3) Management estimate assumes 90,000 units unmatched demand over 3 years and €400,000 average sales price per unit.

(4) Based on expected sales volume for ongoing projects when fully developed; as of 31 December 2017.

Instone is a leading residential developer in Germany

Instone has successfully positioned itself as a leading and scalable real estate development platform with rapid growth prospects

Source: Company information.

• 22 | (1) Based on expected sales volume for fully developed projects as of 31 December 2014.
• (2) Based on expected sales volume for fully developed projects as of 31 December 2016.

(3) Based on expected sales volume for ongoing projects when fully developed; as of 30 September 2017. Includes six projects with sales volume of €409m (€359m + €50m in Wiesbaden-Delkenheim) not captured by the BNPP RE appraisal. Excluding newly acquired projects in Frankfurt and Halle with sales volume of €58m (€33m + €25m).

Fast-growing German metropolitan housing market

23 | (1) Bulwiengesa, Potential Analysis German Housing Market, compiled for Instone as of 24 October 2017.

(2) Bertelsmann population report.

(3) Deloitte, Property Index July 2017.

(4) CBRE Germany Real Estate Market Outlook 2017.

Structural housing need with material unmatched demand

Unmatched demand of 90,000 units through 2020 in Instone's core markets further fuelled by urbanisation and immigration trends

(1) Bulwiengesa, Potential Analysis German Housing Market, compiled for Instone as of 24 October 2017 (Berlin, Dusseldorf, Frankfurt, Hamburg, Cologne, Leipzig, Munich, Stuttgart).

• (2) Winning Frankfurt; WHU-Otto Beisheim School of Management.
• (3) Bulwiengesa (project development study).

Favourable regulatory framework leading to attractive cash flow profile

Significant amount of construction costs covered by customers' regular payments

25 | (1) MaBV - Real estate agent and commercial construction industry ordinance ("Makler- und Bauträgerverordnung"). (2) Unless significant delays occur and are not solved within a set reasonable deadline.

Leading nationwide platform in a fragmented market

	Secured projects not yet under construction(1)	Commentary	Presence in key metropolitan regions
In 000s sqm EXPLORED STATE	318	Presence in key metropolitan regions with multiple sales channels and breadth of products (incl. redevelopment). Highly competent in solving complex situations	O Justice doc Ar Antonio de British Codosfe Bookin s
CG GRUPPE	298	Limited presence in owner-occupier market	CD
G GROTH GRUPPI	249	Presence only in Berlin
$\mathcal{B}$ BONAVA	223	No presence in Munich, focused on out-of-town affordable residential developments	$C$ D IB. н s.
	199	Subscale competitor, no nationwide presence
ZECH GROUP	164	Subscale competitor without unified platform	CDF B 1 S
Ten Brinke	153	Subscale competitor, no nationwide presence	$C$ $D$ B
$\bullet$ bpd	150	Subscale competitor	C D IS. IB.
PATRIZIA	137	Asset manager with ad-hoc development projects	C. D
KONDOR 2	94	No nationwide presence

26 | Source: Bulwiengesa, Potential Analysis German Housing Market, compiled for Instone as of 24 October 2017 based on companies' own declarations and Bulwiengesa estimates for Leipzig. (1) Includes projects in Berlin, Cologne, Dusseldorf, Frankfurt, Hamburg, Leipzig, Munich, and Stuttgart.

Rigorous control over the entire development process

• 27 | Source: Company information.
• Note: Statistics refer to projects completed in 2015, 2016 and 2017 unless otherwise stated.
• (1) As measured by sqm achieved vs. planned.
• (3) For ground-up development projects delivered between 2015 and 2017.
• (2) Excluding €1.8m (less than 0.1% of total number) for one unsold commercial unit.
• (4) For projects delivered between 2015 and December 2017.

Instone has achieved consistent project-level returns and margins…

Strong and consistent gross margin performance

• 28 | Source: Company information as of 30 September 2017.
• (1) Weighted average by expected sales volume.
• (2) Lower initially planned margin due to general contracting, rather than usually preferred method of single awarding.

… enabled by continued efficiency improvements

Scaling effects and cost improvements are paired with favourable market conditions

29 | Source: Company information.

Note: Projects approved since 2011 but completed between 2015 and September 2017, weighted by sales volume.

(1) Analysis conducted for Instone Development projects only.

Instone's products are well priced according to local markets

30 | Source: Bulwiengesa, Potential Analysis German Housing Market, compiled for Instone as of 24 October 2017.

Visibility driven by well-located €3.4bn(1) project portfolio

Core competency in successfully acquiring top priority projects from wide range of market opportunities

p.a. average of 1bn in acquired project volume over the last 3 years

Solution provider to sellers of land

Leading nationwide platform with scalability potential

(5) Without staff cost inflation. (6) Based on projected unit deliveries from €3.4bn project portfolio and potential future acquisitions.

⁽¹⁾ As of 30 September 2017. (2) Management estimate. (3) Includes staff costs of approx. €25m, professional costs of approx. €4m, property costs of €3m and transportation costs of €2m. (4) Based on an average/ expectation number of 1,000 units (2014 to 2016) and an average sales price of €400,000.

Short-term financial outlook

35 | Source: Preliminary BNPP Real Estate independent appraisal, management estimates.

Note: Financial outlook prepared excluding impact of PPA amortization.

(1) BNPP Real Estate shows total sales volume in 2019 of €489m. Difference to €507m shown is due to a condominium project with a sales volume of €15m in Wiesbaden-Delkenheim which has not been included in the calculation of BNPP Real Estate + €5m others.

Strong target project level and group returns

36 | Source: Management estimates.

Note: Financial outlook prepared excluding impact of PPA amortization.

(1) ROCE defined as EBIT pre PPA / (2-year average GAV) with GAV defined as equity (NAV) + net debt.

Attractive newbuild economics in key German metropolitan regions

37 | Source: Bulwiengesa, Destatis.

• (1) Note: Housing price index and rental index represent new units and are calculated as averages of Germany's key metropolitan regions. Key metropolitan regions includes city-level data for Berlin, Cologne, Dusseldorf, Frankfurt, Hamburg, Leipzig, Munich and Stuttgart. Construction cost index and consumer price index represent data for Germany on a country-wide basis.
• (2) Includes material and labour costs, excludes land costs.

BNPP RE independent appraisal report methodology

Source: BNPP Real Estate.

Typical project cash flow profile

Operating performance under CC method

CC method applied to all projects started after August 2015

Illustrative snapshot of operating performance/ project EBT (cumulative)
									Revenue and EBT realised at project delivery ---------------------------------------
Land acquisition			Start of construction			Sale completion (100% sold)			Delivery
In $\epsilon$ m	Δ	Cum.	In $\epsilon$ m	Δ	Cum.	In $\epsilon$ m	Δ	Cum.	In $\epsilon$ m	Λ	Cum.
Revenue		$\overline{\phantom{0}}$	Revenue		$\overline{\phantom{0}}$	Revenue	-	$\overline{\phantom{m}}$	Revenue	100	$(100)$ -----
Change in inventory	22	22	Change in inventory	5	27	Change in inventory	29	56	Change in inventory	(56)	$\overline{\phantom{0}}$
Operating performance	22	22 2	Operating performance	5 1	27	Operating performance	29	56	Operating performance	44	100
Cost of materials	(20)	(20)	Cost of materials	(3)	(23)	Cost of materials	(28)	(51)	Cost of materials	(20)	(71)
Stat costs(1)	(1)	(1)	Staff costs $(1)$	(1)	(2)	Stat costs(1)	(1)	(3)	$Stat \cos(s^{(1)})$	(1)	(4)
Net other expenses $(1)$	(2)	(2)	Net other expenses $(1)$	(1)	(3)	Net other expenses $(1)$	(1)	(4)	Net other expenses (1)	(1)	(5)
Finance costs		$\overline{\phantom{0}}$	Finance costs	(1)	(1)	Finance costs	(1)	(2)	Finance costs	$\overline{\phantom{0}}$	(2)
EBT	(1)	(1)	EBT	(1)	(2)	EBT	(2)	(4)	EBT	22	$18$ $\sim$ $-1$
						Cumulative view of a single project over time

Attractive funding terms

Debt funding requirement limited in terms of quantum and duration

Summary independent appraisal report of project portfolio

Acquisition costs of €82m for land plots not valued by BNPP RE (project volume €409m) lead to a GAV of €955m

	Overview of social housing quotas in key cities per newbuild project	Commentary
Berlin	30% of rental apartments	All German cities require some form of social
Dusseldorf	40% of total (with 20%-30% subsidised rental apartments)	housing quota These vary from city to city and region to region
Frankfurt	30% of rental apartments	ranging anywhere from 25% to 50%
Hamburg	33% of rental apartments	Regulations have been under scrutiny causing debate and the ongoing change and reworking o
Cologne	30% of rental apartments	rules and quotas, especially in attractive key metropolitan regions
Munich	30% of total as subsidised (rental) apartments
Stuttgart	20% of rental apartments

Source: Immobilienmanager .

Favorable fundamentals for the German residential development sector vs. other European markets

	(1) Management assessment. (3) Deloitte Property Index 2017. (5) KPMG Property Lending Barometer 2017.	(2) Management estimate.	(4) CBRE Research EMEA Investment Guide 2016.

Deep and committed bench of management professionals who will continue delivering top quality development projects

Supervisory Board			Assessment of Independence	Comments
	Stefan Brendgen (German nationality) Current experience/ board mandates - IVG Immobilien AG - board member (until Sep 2017) - TRIUVA Kapitalanlagegesellschaft mbH - chairman of the supervisory board - HAHN Immobilien Beteiligungs-AG - board member - CLIMEON AB, Sweden - board member - aamundo Asset Management KGaA - chairman of the supervisory board	Previous experience - CEO of Allianz Real Estate Germany - Tishman Speyer, head of Germany - Jones Lang Wootton (today JLL) and DTZ International Property Advisers		Real estate sector/ real estate development experience Supervisory board experience (including as chairman) ■ Will act as chairman of the supervisory board Independent board member
	Dr. Jochen Scharpe (German nationality) Current experience/ board mandates - LEG Immobilien AG - board member - Managing Partner, AMCI GmbH/ Managing Partner, ReTurn Immobilien GmbH	Previous experience - FFIRE AG - vice chairman of the supervisory board - GENEBA Properties N.V. - board member - Siemens Real Estate GmbH, Managing Director - Eisenbahnimmobilienmanagement GmbH (Vivico GmbH, now CAImmo Deutschland GmbH), Managing Director - KPMG, Senior Manager		Real estate sector experience Supervisory board experience (including as chairman of the supervisory board) Financial expertise ■ Will act as head of the audit committee Independent board member
	Marija Korsch (US American nationality) Current experience/ board mandates - Aareal Bank AG - chairperson of the supervisory board since 2013 - FAZIT Stiftung Gemeinnützige Verlagsgesellschaft mbH and Just Software AG - board member	Previous experience - Head of Corporate Finance, Bankhaus Metzler seel. Sohn & Co. AG - Managing Director, Bankers Trust		Candidate is independent from current shareholders, therefore majority of supervisory board members will be independent High level board experience Capital markets and financial expertise ■ Will be member of Nominations Committee
	Stefan Mohr (German nationality) Current experience/ board mandates - Head of Corporate Real Estate at Activum SG Advisory GmbH	Previous experience - Head of M&A and Corporate Investments at HSH Nordbank AG - Head of Financial Institutions M&A business at Sal. Oppenheim - Various positions at Bankhaus Metzler and PwC	$\mathbf x$	M&A and capital market expertise Real estate sector/ real estate development expertise ■ Will act as Vice Chairman of Supervisory Board ■ Will be member of Audit Committee
	Richard Wartenberg (German nationality) Current experience/ board mandates - Activum SG Advisory GmbH, Managing	Previous experience - apellas Asset Management - Managing Director at Polis and Bouwfonds Asset Management Germany - Behne Group (now HIH Hamburgische Immobilien Handlung) - RSE Projektmanagement AG	×	Real estate sector/ real estate development experience M&A experience/ financial expertise ■ Will be member of Nominations Committee

Remuneration and incentive structure

Components	% of total target compensation	Description
Base Salary	■ c. 36% to 45%	Paid out on a monthly basis Comprises all fixed contractually guaranteed annual payments
New STI	c. 25% to 41%	■ Paid out annually. New STI linked to performance targets: ■ 80% company specific criteria, 20% personal criteria EBT, ROCE as company specific criteria Company specific criteria are weighted 66% EBT and 34% ROCE, in relation to the defined business plan ■ Over- (under-)achievement of EBT and ROCE targets leads to increase/ reduction of EBT and ROCE target pay-out Significant underachievement result in no pay-out (hurdle rate at 80% target achievement) ■ Cap on pay-out of new STI at 150% of target compensation
New LTIP	■ c. 23% to 30%	Introduction of a new share-based LTIP to align management and public investor interests Participants: ■ CEO, CFO, CDO, CSO up to 4 additional key executives Potentially available for new senior management members joining the company post-IPO (to be decided by future supervisory board) ■ Target amount in % of base salary: c. 57% to 67% Annual base allocation of virtual shares depending on performance based on 3 prior years (1) (+1% for 1% outperformance), capped at c. 150% of the base allocation KPIs to be used: EBT in relation to the defined business plan Allocated Amount invested in virtual shares over a 3 year period After 3 years Allocated Amount vests and management receives a cash payment from the respective tranche of virtual shares ('Payout Amount') The Payout Amount for each annual tranche depends on the total shareholder return (share price plus dividend payment) of the Instone shares over that period, subject to a cap (Payout Amount capped at 200% of Allocated Amount)
Description Components
Treatment of Current LTIP	Existing LTIP will be converted and paid-out to Management at IPO ■ 70% of net after tax proceeds will be reinvested by Management into Instone shares at IPO These shares will be locked up for a period of three years; each year 1/3 of these shares will be released from the lock-up Activum will compensate Instone for the costs related to the LTIP; there will be no net cash outflow from the Company

Disclaimer

For any questions please contact Investor Relations:

Thomas Eisenlohr

Head of Investor Relations

Instone Real Estate Group N.V.

Baumstraße 25, 45128 Essen

T +49 201 45355-365 | F +49 201 45355-904

Thomas.Eisenlohr@instone.de