DEMIRE Deutsche Mittelstand Real Estate AG

Quarterly Report • Nov 25, 2022

1 JANUARY TO 30 SEPTEMBER INTERIM REPORT 2022

HIGHLIGHTS 9M 2022

KEY EARNINGS FIGURES

30.8

in EUR million FFO I (after taxes, before minority interests), compared to EUR 30.4 million in 9M 2021

59.9

in EUR million RENTAL INCOME, compared to EUR 62.3 million in 9M 2021

2 Excl. properties held for sale and classified as a project development

KEY FINANCIAL INDICATORS

51.2

in % NET LOAN-TO-VALUE RATIO 1 (NET LTV), compared to 49.7% at the end of 2021

1.67

in % p.a. AVERAGE NOMINAL INTEREST COSTS, stable compared to year-end 2021

5.87

in EUR NET ASSET VALUE (PER SHARE, BASIC), compared to EUR 5.96 at year-end 2021

PORTFOLIO DEVELOPMENT

in EUR billion PORTFOLIO VALUE, unchanged compared to year-end 2021

83.8 9.4

in EUR million ANNUALISED RENTAL INCOME, compared to EUR 78.1 million at year-end 2021

in % LIKE-FOR-LIKE INCREASE in annualised rental income compared to –2.3% in 9M 2021 in 9M 2021 1 According to the definition of bond 19/24

1.4 5.0

in years WALT, after 4.7 years at year-end 2021

in % EPRA VACANCY RATE 2, compared to 11.0% at year-end 2021

4.9 194,840

in m 2 LETTING PERFORMANCE, compared to 138,362 m²

CONTENTS

Key for navigating the interim report:

Reference to table of contents

Reference to another page in the interim report

Reference to websites

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 Key Group figures 4 Portfolio highlights 5 INTERIM GROUP MANAGEMENT REPORT 6 Overview 7 Economic report 10 Opportunities and risks 18 Subsequent events 18

INTERIM CONSOLIDATED FINANCIAL
STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

FOREWORD BY THE EXECUTIVE BOARD

Dear Shareholders, dear Readers,

DEMIRE provides consistency and stability in the face of challenging economic and geopolitical conditions. The economy and society are facing extraordinary challenges. The war in Ukraine is causing great human suffering and destruction and is affecting all areas of our lives. We are experiencing disrupted supply chains, volatile energy markets and turbulence in financial markets around the world. Inflation is back and it seems to be here to stay, at least in the short to medium term. The European Central Bank reacted by raising interest rates, the effectiveness of which will become apparent in the coming months. In the German real estate market, the changed interest rate landscape has already led to increased uncertainty.

Despite these developments, DEMIRE was once again able to demonstrate its resilience in the first nine months of 2022. Neither high inflation nor the geopolitical situation had any direct significant impact on the company's business development in the reporting period.

The Group's key performance indicators in the third quarter of 2022 are in some cases even above the level of the previous year. Particularly noteworthy is the high letting performance of almost 195,000 m². This is not only a new record for a ninemonth period, but also reflects the success of our "REALize Potential" strategy. Although some of the leasing successes will not be reflected in the portfolio's key figures until the 2023 and 2024 financial years, the numerous contracts signed and renewals underline the resilience of DEMIRE's portfolio.

DEMIRE's key indicators improved overall in the first nine months of 2022.

• Rental income totalled EUR 59.9 million (previous year: EUR 62.3 million) in line with expectations.
• Profit from the rental of real estate developed similarly and amounted to EUR 47.7 million, compared to EUR 51.8 million in the same period of the previous year.
• Funds from operations (FFO I, after taxes, before minority interests) increased 1.4% to EUR 30.8 million.

• The rental performance of around 194,840 m² was a record for a nine-month period, primarily driven by large-scale rentals.

• The like-for-like growth in annualised contractual rents was 4.9% compared to 30 September 2021. This significant increase is due to successful new lettings, including in the "LogPark" in Leipzig, and indexation of existing leases.

• The EPRA Vacancy Rate1 fell to 9.4%; WALT rose to a historic high of 5.0 years as a result of the strong letting performance.
• The NAV per share (basic) fell to EUR 5.87 compared to EUR 5.96 at the end of 2021 following the dividend payment.
• The net loan-to-value ratio² (net LTV) increased to 51.2% (–20 basis points compared to the previous quarter), primarily due to the dividend payment. As of the reporting date, liquidity remains healthy at EUR 95.6 million.
• The average nominal financing costs remained unchanged at an attractive 1.67% p.a.; there will be no significant maturities until mid-2024.

One thing is already certain – in light of the war in Ukraine and high inflation rates, the macroeconomic situation will remain challenging until the end of the year and beyond. As a result, uncertainty on the property transaction markets is high, not least due to the upward trend in interest rates. Nevertheless, given the positive 2022 financial year to date, the Executive Board has confirmed the forecast for the full year: rental income is expected to be between EUR 78.0 million and EUR 80.0 million (2021: EUR 82.3 million) and FFO I (after tax, before minority interests) between EUR 38.5 million and EUR 40.5 million (2021: EUR 39.8 million).

Frankfurt am Main, 17 November 2022

Ingo Hartlief (FRICS) (CEO)

Tim Brückner (CFO)

Excl. properties held for sale and classified as a project development

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19

IMPRINT 39

² According to the definition of bond 19/24

DEMIRE AT A GLANCE

Key Group figures	4
Portfolio highlights	5

KEY GROUP FIGURES

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
Key Group figures	4
Portfolio highlights	5
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19

IMPRINT 39

in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022
Key earnings figures
Rental income	62,276	59,910
Profit/loss from the rental of real estate	51,779	47,682
EBIT	42,555	41,160
Financial result	–15,215	–12,927
EBT	27,340	28,233
Net profit/loss for the period	24,575	21,879
Net profit/loss for the period attributable to parent company shareholders	22,682	20,181
Net profit/loss for the period per share (basic/diluted) (in EUR)	0.21/0.21	0.19/0.19
FFO I (after taxes, before minority interests)	30,432	30,847
FFO I per share (basic/diluted) (in EUR)	0.29/0.29	0.29/0.29

in EUR thousand	31/12/2021	30/09/2022
Key balance sheet figures
Total assets	1,705,594	1,694,870
Investment property	1,433,096	1,452,968
Non-current assets held for sale	0	3,490
Total real estate portfolio	1,433,096	1,456,458
Financial and lease liabilities	914,986	911,700
Cash and cash equivalents	139,619	95,612
Net financial liabilities	775,367	816,088
Net loan-to-value (net LTV) (in %)	49.7	51.2
Equity according to Group balance sheet	592,362	580,413
Equity ratio (in %)	34.7	34.2
Net asset value (NAV)	549,023	535,914
NAV (basic/diluted)		628,976/629,486 619,284/619,794
Number of shares (basic/diluted)		105,513/106,023 105,513/106,023
EPRA NAV per share (basic/diluted)(in EUR)	5.96/5.94	5.87/5.85

in EUR thousand	31/12/2021	30/09/2022
Key portfolio indicators
Properties (number)	64	64
Market value (in EUR million)	1,412.5	1,412.5
Annualised contractual rents (in EUR million)	78.1	83.8
Rental yield (in %)	5.5	5.9
EPRA vacancy rate 1 (in %)	11.0	9.4
WALT (in years)	4.7	5.0

1 Excluding project developments and assets held for sale

PORTFOLIO HIGHLIGHTS as at 30 September 2022

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3

Key Group figures 4 Portfolio highlights 5

INTERIM GROUP MANAGEMENT REPORT 6

INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19

IMPRINT 39

in EUR billion MARKET VALUE OF THE REAL ESTATE PORTFOLIO

properties at 53 LOCATIONS in 13 federal states

83.8 5.9

in EUR million ANNUALISED CONTRACTUAL RENTS

4.9 5.0

in % LIKE-FOR-LIKE INCREASE of annualised contractual rent

1.4 8.37

in EUR/m² AVERAGE RENT across the portfolio

64 9.4

in % EPRA VACANCY RATE1 across the portfolio

in % GROSS RENTAL RETURNS

in years AVERAGE REMAINING LEASE TERM of rental contracts (WALT)

Excl. properties held for sale and classified as a project development

INTERIM GROUP MANAGEMENT REPORT

for the reporting period from 1 January to 30 September 2022

Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18

OVERVIEW

BUSINESS PERFORMANCE

DEMIRE's business performed well in the first nine months of 2022. Despite strategic property sales in the previous year, the Group's key figures are in line with the previous year's level and in some cases even show an improvement. This was in line with the Company's plans and expectations. Neither the COVID-19 pandemic nor the war in Ukraine had any direct, significant impact on DEMIRE's business development during the period under review. The consistent implementation of the "REALize Potential" strategy in recent years has created a stable foundation for solid future development, which is also reflected in the first nine months of 2022.

Given the changes in the real estate and capital market environment, however, the Executive Board decided, with the approval of the Supervisory Board, to expedite the implementation of the "REALize Potential" strategy. The company also aims to build up liquidity reserves for refinancing purposes.

DEMIRE's key indicators improved overall in the first nine months of 2022.

• Rental income totalled EUR 59.9 million (previous year: EUR 62.3 million) in line with expectations.
• Profit from rental income developed similarly and amounted to EUR 47.7 million, compared to EUR 51.8 million in the same period of the previous year.
• Funds from operations (FFO I, after taxes, before minority interests) increased 1.4% to EUR 30.8 million.
• The rental performance of around 194,840 m² was a record for a nine-month period, primarily driven by large-scale rentals.

• The like-for-like growth in annualised contractual rents was 4.9% compared to 30 September 2021. This significant increase is due to successful new lettings, including in the "LogPark" in Leipzig, and indexation of existing leases.

• The EPRA Vacancy Rate 1 fell to 9.4%; WALT rose to a historic high of 5.0 years as a result of the strong letting performance.

• The NAV per share (basic) fell to EUR 5.87 compared to EUR 5.96 at the end of 2021 following the dividend payment.
• The net loan-to-value ratio² (net LTV) rose to 51.2% (–20 basis points compared to the previous quarter), primarily due to the dividend payment, while liquidity remained comfortable at EUR 95.6 million as of the reporting date.
• The average nominal financing costs remained unchanged at an attractive 1.67% p.a.; there will be no significant maturities until mid-2024.

PERFORMANCE IN LINE WITH FORECAST FOR 2022 FINANCIAL YEAR

The uncertainties and implications for the 2022 financial year resulting from the COVID-19 pandemic, the Ukraine war, the increased inflation and, in particular, the increase in energy prices cannot yet be estimated with sufficient certainty at the end of the third quarter. In light of this, the Executive Board decided, with the approval of the Supervisory Board, to expedite the implementation of the "REALize Potential" strategy to reduce complexities. The company now aims to build up sufficient liquidity reserves for refinancing purposes. Following the positive nine-month result in 2022, the Executive Board nevertheless confirms the forecast for the 2022 financial year: rental income will be between EUR 78.0 million and EUR 80.0 million (2021: EUR 82.3 million), and FFO I (after tax, before minority interests) is expected to be between EUR 38.5 million and EUR 40.5 million (2021: EUR 39.8 million).

¹ Excl. properties held for sale and classified as a project development

² According to the definition of bond 19/24

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

FOREWORD BY THE EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

REAL ESTATE PORTFOLIO

As of the reporting date the property portfolio comprises 64 properties, unchanged since the end of the previous year (31 December 2021: 64 properties).

The lettable building area of the portfolio is 926,803 million m² (31 December 2021: 912,724 million m²) and the total market value is approximately EUR 1.4 billion (31 December 2021: approximately EUR 1.4 billion). An external property valuation of the portfolio was last performed on 31 December 2021.

The EPRA vacancy rate 1 improved to 9.4% as at 30 September 2022, down from 11.0% as at 31 December 2021. The WALT was 5.0 years as at 30 September 2022, up from 4.7 years at year-end 2021. DEMIRE's letting performance reached a very strong 194,840 m² in the reporting period. New lettings contributed 32%, while follow-on lettings made up 68%. The letting performance was driven in particular by the extension of the 56,000 m² lease agreement with the operator of the fashion wholesale trading platform IMOTEX in Neuss. In addition, large-volume rental agreements were concluded or extended with tenants in the "LogPark" in Leipzig. Furthermore, a long-term new lease was signed with the international hotel chain "Premier Inn" in the "Kurfürsten Galerie" in Kassel.

TOP TEN TENANTS (AS AT 30 SEPTEMBER 2022)

No.	Tenant	Type of use	Contractual rents p.a.1 in EUR million	in % of total
1	GMG/Dt. Telekom	Office	11.4	13.6
2	Imotex	Retail	5.4	6.4
3	GALERIA Karstadt Kaufhof	Retail	3.7	4.4
4	momox GmbH	Logistics	2.4	2.8
5	Bima Bundesanstalt für Immobilien aufgaben	Office	2.3	2.7
6	Amazon	Logistics	2.2	2.6
7	Roomers	Hotel	1.9	2.2
8	Sparkasse Südholstein Office		1.6	1.9
9	comdirect bank AG	Office	1.3	1.5
10	Die Autobahn GmbH des Bundes	Office	1.2	1.4
Total			33.2	39.7
Other			50.6	60.3
Total			83.8	100.0

Based on annualised contractual rents, excluding ancillary costs

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 Overview 7 Economic report 10 Opportunities and risks 18 Subsequent events 18 INTERIM CONSOLIDATED

FINANCIAL STATEMENTS 19

1 Excluding project developments and assets held for sale

IMPRINT 39

PORTFOLIO BY ASSET CLASS Number of properties Market value in EUR million Share by market value in % Lettable space in thousand m2 Market value per m2 Contractual rent in EUR million p.a. Contractual rent per m² Rental returns in % EPRA vacancy rate 1 in % WALT in years Office 42 843.7 59.7 518.5 1,627 49.4 9.20 5.9 11.9 3.4 Retail 17 357.1 25.3 220.1 1,623 23.9 9.48 6.7 3.0 5.7 Logistics & Other 5 211.6 15.0 188.2 1,124 10.4 5.21 4.9 12.4 10.4 Total – 30 September 2022 64 1,412.5 100.0 926.8 1,524 83.8 8.37 5.9 9.4 5.0 Total – 31 December 2021 64 1,412.5 100.0 912.7 1,548 78.1 8.00 5.5 11.0 4.7 Change (in %/pp) 0.0 0.0 0.0 1.5 –1.5 7.26 4.6 0.4 –1.6 0.3

ECONOMIC REPORT

Results of operations, net assets and financial position

RESULTS OF OPERATIONS

In the first nine months of 2022, the DEMIRE Group generated rental income totalling EUR 59.9 million (previous year: EUR 62.3 million). Rental income decreased by 3.8% compared to the same period of the previous year, primarily due to the sale of properties. The result from the rental of real estate also fell by 7.9% to EUR 47.7 million (previous year: EUR 51.8 million) due to higher maintenance expenses.

In the first nine months of 2022, an investment in a fully depreciated real estate company in Romania was sold, meaning that the result from the sale of properties is EUR 1.1 million (previous year: EUR 0.7 million). In the third quarter, one property in Bremen was sold above market value. The disposal took place on 1 November 2022 and is therefore not yet included in the aforementioned disposal result as at the 30 September 2022 reporting date. However, the sale made a positive contribution of EUR 0.2 million (previous year: EUR 1.8 million) to the fair value adjustment result of investment properties.

Impairment losses on receivables continued to decrease sharply and amounted to EUR 0.4 million (net) in the first nine months of 2022, especially as reversals of impairment losses occurred to a significant extent. This underscores DEMIRE's efficient tenant management and ability to successfully collect receivables. An expense of EUR 2.9 million was incurred in the same period of the previous year which was mainly attributable to tenants of hotels and retail properties that were either insolvent or threatened with insolvency as a result of the pandemic.

General administrative expenses were reduced again in the first nine months of 2022 and, at EUR 7.2 million, were 13.3% below the previous year's figure (EUR 8.3 million).

Earnings before interest and taxes (EBIT) of EUR 41.2 million were 3.3% below the previous year's figure of EUR 42.6 million.

The financial result benefited from the income generated from the investment in the "Cielo" property. It amounted to EUR –12.9 million in the first nine months of 2022, compared to EUR –15.2 million in the same period of the previous year. Financial expenses increased slightly by 3.9% to EUR 14.1 million in the first nine months.

Minority interests in earnings fell to EUR 3.5 million (previous year: EUR 3.7 million). The average nominal interest rate on debt remains unchanged at 1.67% p.a. Earnings before taxes (EBT) went up to EUR 28.2 million in the reporting period, compared to EUR 27.3 million in the previous year. After higher tax expenses, the net result for the first nine months of 2022 amounted to EUR 21.9 million, compared to EUR 24.6 million in the same period of the previous year.

FOREWORD BY THE EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT Overview	6 7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 Overview 7 Economic report 10 Opportunities and risks 18 Subsequent events 18 INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19 IMPRINT 39

CONSOLIDATED INCOME STATEMENT

(selected information in EUR thousand)	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022	Change	in %
Rental income	62,276	59,910	–2,366	–3.8
Income from utility and service charges	16,459	22,654	6,195	37.6
Operating expenses to generate rental income	–26,956	–34,882	–7,926	29.4
Profit/loss from the rental of real estate	51,779	47,682	–4,097	–7.9
Income from the sale of real estate and real estate companies	57,810	1,053	–56,757	–98.2
Expenses related to the sale of real estate and real estate companies	–57,072	0	57,072	–100.0
Profit/loss from the sale of real estate and real estate companies	738	1,053	315	42.7
Profit/loss from fair value adjustments of investment properties	1,764	193	–1,571	–89.1
Impairment of receivables	–2,858	–350	2,508	–87.8
Other operating income	673	673	0	0.0
General and administrative expenses	–8,293	–7,194	1,099	–13.3
Other operating expenses	–1,248	–897	351	–28.1
Earnings before interest and taxes	42,555	41,160	–1,395	–3.3
Financial result	–15,215	–12,927	2,288	–15.0
Earnings before taxes	27,340	28,233	893	3.3
Current income taxes	–1,654	–2,937	–1,283	77.6
Deferred taxes	–1,112	–3,417	–2,305	>100
Net profit/loss for the period	24,574	21,879	–2,695	–11.0
Thereof attributable to parent company shareholders	22,682	20,181	–2,501	–11.0
Basic earnings per share (in EUR)	0.21	0.19	–0.02	–9.5
Weighted average number of shares outstanding	105,513	105,513	0	0.0
Diluted earnings per share (in EUR)	0.21	0.19	–0.02	–9.5
Weighted average number of shares outstanding (diluted)	106,023	106,023	0	0.0

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

NET ASSETS

As at 30 September 2022, the balance sheet total decreased by EUR 10.7 million to EUR 1,694.9 million compared to year-end 2021. This was mainly the result of the EUR 44.0 million reduction in cash and cash equivalents, which was largely influenced by the dividend distribution.

The value of investment property as at 30 September 2022 was EUR 1,453.0 million, an increase of EUR 19.9 million compared to 31 December 2021. The drivers of this increase were building measures that were activated and other rent incentives. The property in Bremen is considered an asset held for sale (EUR 3.5 million) after the signing of the sales contract until the transfer of benefits and encumbrances. No properties were held for sale in the same period of the previous year.

Group equity amounted to EUR 580.4 million as at 30 September 2022, up from EUR 592.4 million as at 31 December 2021. The main reason for the decline was the dividend payment in May 2022, while the result for the period had an offsetting effect. The equity ratio came to 34.2% (31 December 2021: 34.7%). It should be noted that non-controlling minority interests reported in the Group's borrowed capital of around EUR 84.7 million (31 December 2021: EUR 82.9 million) are carried as non-current liabilities and not as equity in accordance with IFRS, solely as a result of the legal form of Fair Value REIT's fund participations as partnerships. The corresponding adjusted Group equity totalled approximately EUR 665.1 million (31 December 2021: EUR 675.2 million).

Total financial liabilities amounted to EUR 886.3 million as at 30 September 2022. These decreased by EUR 4.2 million compared to 31 December 2021, which corresponds to the current repayment.

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 Overview 7 Economic report 10 Opportunities and risks 18 Subsequent events 18 INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19 IMPRINT 39

(selected information in EUR thousand)	31/12/2021	30/09/2022	Change	in %
Assets
Total non-current assets	1,543,819	1,565,715	21,896	1.4
Total current assets	161,775	125,665	–36,110	–22.3
Assets held for sale	0	3,490	3,490	>100
Total assets	1,705,594	1,694,870	–10,724	–0.6

CONSOLIDATED BALANCE SHEET – EQUITY AND LIABILITIES

CONSOLIDATED BALANCE SHEET – ASSETS

(selected information in EUR thousand)	31/12/2021	30/09/2022	Change	in %
Equity and liabilities
Equity
Equity attributable to parent company shareholders	549,023	535,914	–13,109	–2.4
Non-controlling interests	43,339	44,499	1,160	2.7
Total equity	592,362	580,413	–11,949	–2.0
Liabilities
Total non-current liabilities	1,066,581	1,065,196	–1,385	–0.1
Total current liabilities	46,651	49,261	2,610	5.6
Total liabilities	1,113,232	1,114,457	1,225	0.1
Total equity and liabilities	1,705,594	1,694,870	–10,724	–0.6

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

FINANCIAL POSITION

Cash flow from operating activities amounted to EUR –1.1 million in the first nine months of 2022 (previous year: EUR –19.5 million), which is mainly due to a lower dividend distribution compared to the same period of the previous year.

Cash flow from investing activities amounted to EUR –24.2 million in the reporting period, compared to EUR –34.4 million in the previous year. The majority was due to investments in investment property. The difference compared to the same period in the previous year is mainly due to the investment in the "Cielo" property in 2021.

Cash flow from financing activities came to EUR –18.6 million, compared to EUR 50.6 million in the same period of the previous year. Mortgage loans of EUR 69.7 million were disbursed in the same period of the previous year, while no loans were taken out in the first nine months of 2022.

Cash and cash equivalents amounted to EUR 95.6 million on 30 September 2022 (31 December 2021: EUR 139.6 million; 30 September 2021: EUR 98.4 million).

CONSOLIDATED STATEMENT OF CASH FLOWS

Cash and cash equivalents at the end of the period	98,388	95,612	–2,776
Net change in cash and cash equivalents	–3,233	–44,007	–40,774
Cash flow from finacing activities	50,630	–18,621	–69,251
Cash flow from investing activities	–34,407	–24,239	10,168
Cash flow from operating activities	–19,455	–1,147	18,309
(selected information in EUR thousand)	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022	Change

Funds from operations (FFO)

Funds from operations I (after taxes, before minority interests), the key operating performance indicator, increased by 1.4% to EUR 30.8 million in the first nine months of 2022, compared to EUR 30.4 million in the same period of the previous year. On a diluted basis, FFO I per share amounted to EUR 0.29, compared to EUR 0.29 in the same period of the previous year.

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 Overview 7 Economic report 10 Opportunities and risks 18 Subsequent events 18 INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19 IMPRINT 39

FFO CALCULATION
(selected information in EUR thousand)	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022	Change	in %
Earnings before taxes	27,341	28,233	892	3.3
Minority interests	3,748	3,488	–260	–6.9
Earnings before taxes (EBT)	31,089	31,720	632	2.0
± Profit/loss from the sale of real estate	–738	–1,053	–315	42.7
± Profit/loss from the valuation of investment properties	–1,764	–193	1,571	–89.1
± Other adjustments 1	3,595	2,127	–1,468	–40.8
FFO I before taxes	32,181	32,602	421	1.3
± (Current) income taxes	–1,749	–1,755	–5	0.3
FFO I after taxes	30,432	30,847	415	1.4
Thereof attributable to parent company shareholders	24,946	25,534	589	2.4
Thereof attributable to non-controlling interests	5,486	5,313	–173	–3.2
± Profit/loss from the sale of real estate and real estate companies (after taxes)	744	1,053	310	41.6
FFO II after taxes	31,175	31,900	725	2.3
Thereof attributable to parent company shareholders	25,825	26,588	762	3.0
Thereof attributable to non-controlling interests	5,350	5,313	–37	–0.7
FFO I after taxes and minority interests
Basic earnings per share (in EUR)	0.24	0.24	0.00	2.4
Weighted average number of shares outstanding	105,513	105,513	0	0.0
Diluted earnings per share (in EUR)	0.24	0.24	0.00	2.4
Weighted average number of shares outstanding (diluted)	106,023	106,023	0	0.0
FFO II after taxes and minority interests
Basic earnings per share (in EUR)	0.24	0.25	0.01	3.0
Weighted average number of shares outstanding	105,513	105,513	0	0.0
Diluted earnings per share (in EUR)	0.24	0.25	0.01	3.0
Weighted average number of shares outstanding (diluted)	106,023	106,023	0	0.0

1 Other adjustments include:

— One-time refinancing costs and effective interest payments (EUR 1.9 million, previous year: EUR 1.7 million)

— One-time transaction, legal and consultancy fees (EUR –0.3 million, previous year: EUR 1.2 million)

— One-time administrative costs (EUR 0.2 million, previous year: EUR 0.6 million)

— Non-period expenses/income (EUR 0.3 million, previous year: EUR 0.1 million)

2
3
6
7
10
18
18
19
39

Net asset value (NAV)

The basic net asset value decreased from EUR 549.0 million as at 31 December 2021 to EUR 535.9 million as at 30 September 2022 due to the dividend payment, with the positive result for the period having an offsetting effect. On an undiluted basis, the NAV as at the reporting date was EUR 5.87 per share (31 December 2021: EUR 5.96 per share).

NET ASSET VALUE (NAV)

in EUR thousand	31/12/2021	30/09/2022	Change	in %
Net asset value (NAV)	549,023	535,914	–13,109	–2.4
Deferred taxes	84,692	88,108	3,417	4.0
Goodwill resulting from deferred taxes	–4,738	–4,738	0	0.0
NAV (basic)	628,977	619,284	–9,693	–1.5
Number of outstanding shares (basic) (in thousands)	105,513	105,513	0	–0.0
NAV per share (basic) (in EUR)	5.96	5.87	–0.09	–1.5
Effect of the conversion of convertible bonds and other equity instruments	510	510	0	0.0
NAV (diluted)	629,486	619,794	–9,692	–1.5
Number of outstanding shares (diluted) (in thousands)	106,023	106,023	0	0.0
NAV per share (diluted) (in EUR)	5.94	5.85	0.09	–1.5

FOREWORD BY THE EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

NET LOAN-TO-VALUE RATIO

The DEMIRE Group's net loan-to-value ratio is defined in the 2019/2024 bond prospectus as the ratio of net financial liabilities to the sum of all assets less intangible assets and cash and cash equivalents. The net loan-to-value ratio increased moderately to 51.2% compared to year-end 2021 (49.7%), but was reduced by 20 basis points compared to the previous quarter.

in EUR thousand	31/12/2021	30/09/2022
Financial liabilities and lease liabilities	914,986	911,700
Cash and cash equivalents	139,619	95,612
Net financial debt	775,367	816,088
Total assets	1,705,594	1,694,870
Intangible assets	–6,783	–6,783
Cash and cash equivalents	–139,619	–95,612
Total assets less intangible assets and cash
and cash equivalents	1,559,192	1,592,475
Net LTV (in %)	49.7	51.2

Covenants for the 19/24 corporate bond

Within the scope of issuing the 2019/2024 corporate bond, DEMIRE undertook to comply with and regularly report on various covenants. The definition of the covenants to be reported on is listed in the offering prospectus for the 2019/2024 corporate bond.

BOND COVENANTS 30/09/2022

	NET LTV	NET SECURED LTV	ICR
Covenant	max. 60%	max. 40%	min. 2.00
Value	51.2%	11.9%	4.58

As at 30 September 2022, DEMIRE had complied with all covenants of the 19/24 corporate bond. In addition, the planning for 2022 and beyond assumes that the covenants will also be complied with at all times in the future.

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
Overview	7
Economic report	10
Opportunities and risks	18
Subsequent events	18
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
IMPRINT	39

Opportunities and risks

Please refer to the disclosures made in the opportunities and risks report included within the consolidated financial statements as at 31 December 2021 for information on the opportunities and risks of future business performance. In addition to the opportunities and risks recorded as at 31 December 2021, the first nine months of 2022 were largely determined by high inflation, in particular the sharp rise in energy costs, higher interest rates and the war in Ukraine. All of these factors create a high degree of uncertainty and a clouding of prospects in the economic environment, but this has not yet had an impact on DEMIRE's key performance indicators. Both rental payments and funds from operations (after taxes, before minority interests) are in line with our expectations.

Nevertheless, DEMIRE's Executive Board is closely monitoring whether and how the economic environment is changing and may possibly have an impact on the performance of the portfolio, for example.

The risks are reviewed continuously and in a structured process. From today's perspective, no risks that could endanger the Company have been identified.

Subsequent events

After the interim reporting date, the tenant Galeria Karstadt Kaufhof applied for protective shield proceedings on 31 October 2022. Galeria Karstadt Kaufhof is a tenant at four properties in Celle, Goslar, Memmingen and Offenburg. At the beginning of the protective shield proceedings, it cannot yet be foreseen to what extent rent payments will be made again. No other events of relevance to DEMIRE's net assets, financial position and results of operations occurred after the interim reporting date.

Frankfurt am Main, 17 November 2022

DEMIRE Deutsche Mittelstand Real Estate AG

Ingo Hartlief (FRICS) (CEO)

Tim Brückner (CFO

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated
financial statements	27

CONSOLIDATED STATEMENT OF INCOME

for the reporting period from 1 January to 30 September 2022

		01/01/2021	01/01/2022	01/07/2021	01/07/2022
in EUR thousand	NOTE	– 30/09/2021	– 30/09/2022	– 30/09/2021	– 30/09/2022
Rental income		62,276	59,910	20,252	20,402
Income from utility and service charges		16,459	22,654	4,286	4,334
Operating expenses to generate rental income		–26,956	–34,882	–6,944	–8,550
Profit/loss from the rental of real estate		51,779	47,682	17,594	16,186
Income from the sale of real estate and real estate companies		57,810	1,053	20,310	1,053
Expenses related to the sale of real estate and real estate companies		–57,072	0	–20,311	0
Profit/loss from the sale of real estate and real estate companies		738	1,053	–1	1,053
Profit/loss from fair value adjustments of investment properties		1,764	193	0	193
Impairment of receivables		–2,858	–350	–2,188	–333
Other operating income		673	673	299	109
General and administrative expenses		–8,293	–7,194	–2,566	–1,924
Other operating expenses		–1,248	–897	–117	–530
Earnings before interest and taxes	D 1	42,555	41,160	13,021	14,754
Financial income 1		1,924	3,221	1,434	1,090
Financial expenses		–13,558	–14,081	–4,633	–4,686
Profit/loss from companies accounted for using the equity method 1		166	1,421	166	648
Minority interests		–3,748	–3,488	–1,422	–1,064
Financial result	D 2	–15,215	–12,927	–4,454	–4,012
Earnings before taxes		27,340	28,233	8,567	10,742
Current income taxes		–1,654	–2,937	–708	–1,504
Deferred taxes		–1,112	–3,417	1,168	–1,359
Net profit/loss for the period		24,575	21,879	9,028	7,879
Thereof attributable to:
Non-controlling interests		1,893	1,697	381	589
Parent company shareholders		22,682	20,181	8,646	7,290
Basic/diluted earnings per share (in EUR)	D 3	0.21	0.19	0.08	0.07

1 The previous year's figures were adjusted based on reporting changes during the period under review

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27

IMPRINT 39

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the reporting period from 1 January to 30 September 2022

in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022	01/07/2021 – 30/09/2021	01/07/2022 – 30/09/2022
Net profit/loss for the period	24,575	21,879	9,028	7,879
Total comprehensive income	24,575	21,879	9,028	7,879
Thereof attributable to:
Non-controlling interests	1,893	1,697	381	589
Parent company shareholders	22,682	20,181	8,646	7,290

CONSOLIDATED BALANCE SHEET as at 30 September 2022

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19 Consolidated statement of income 20 Consolidated statement of comprehensive income 21 Consolidated balance sheet 22 Consolidated statement of cash flows 24 Consolidated statement of changes in equity 26 Notes to the consolidated financial statements 27 IMPRINT 39

ASSETS
in EUR thousand	NOTE	31/12/2021	30/09/2022
Assets
Non-current assets
Intangible assets		6,783	6,783
Property, plant and equipment		228	215
Investment property	E 1	1,433,096	1,452,968
Shares in companies accounted for using the equity method		1,025	2,356
Loans to companies accounted for using the equity method		26,505	25,563
Loans and financial assets		64,264	63,463
Other assets		11,917	14,367
Total non-current assets		1,543,819	1,565,715
Current assets
Trade accounts receivable		8,671	13,459
Financial assets		3,925	4,415
Other assets		3,191	4,540
Tax refund claims		6,369	7,639
Cash and cash equivalents		139,619	95,612
Total current assets		161,775	125,665
Non-current assets held for sale		0	3,490

Total assets 1,705,594 1,694,870

CONSOLIDATED BALANCE SHEET

FOREWORD BY THE EXECUTIVE BOARD 2 DEMIRE AT A GLANCE 3 INTERIM GROUP MANAGEMENT REPORT 6 INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19 Consolidated statement of income 20 Consolidated statement of comprehensive income 21 Consolidated balance sheet 22 Consolidated statement of cash flows 24 Consolidated statement of changes in equity 26 Notes to the consolidated financial statements 27

IMPRINT 39

as at 30 September 2022

EQUITY AND LIABILITIES
in EUR thousand	NOTE	31/12/2021	30/09/2022
Equity and liabilities
Equity
Subscribed capital		105,513	105,513
Reserves	E 2	443,510	430,401
Equity attributable to parent company shareholders		549,023	535,914
Non-controlling interests		43,339	44,499
Total equity		592,362	580,413
Liabilities
Non-current liabilities
Deferred tax liabilities		84,692	88,108
Minority interests		82,882	84,693
Financial liabilities	E 3	874,417	867,250
Lease liabilities		24,285	25,081
Other liabilities		305	64
Total non-current liabilities		1,066,581	1,065,196
Current liabilities
Provisions		4,012	1,731
Trade payables		10,571	8,740
Other liabilities		7,114	8,676
Tax liabilities		8,670	10,745
Financial liabilities	E 3	16,097	19,062
Lease liabilities		187	307
Total current liabilities		46,651	49,261
Total liabilities		1,113,232	1,114,457
Total equity and liabilities		1,705,594	1,694,870

CONSOLIDATED STATEMENT OF CASH FLOWS

24

for the reporting period from 1 January to 30 September 2022

	01/01/2021	01/01/2022
in EUR thousand	– 30/09/2021	– 30/09/2022
Earnings before taxes	27,340	28,233
Financial expenses	13,558	14,081
Financial income	–2,091	–4,642
Minority interests	3,748	3,488
Change in trade accounts receivable	–1,703	–5,138
Change in other receivables and other assets	13,073	–861
Change in provisions	509	–2,281
Change in trade payables and other liabilities	–7,502	–83
Profit/loss from fair value adjustments of investment properties	–1,764	–193
Profit/loss from the sale of real estate and real estate companies	–738	–1,053
Interest proceeds from loans and receivables	1,007	2,163
Interest received from loans to companies accounted for using the equity method	0	872
Income tax payments	–395	–2,133
Depreciation and amortisation and impairment	3,248	1,300
Distributions to minority shareholders/dividends	–67,788	–35,437
Distributions from companies accounted for using the equity method	171	90
Other non-cash items	–127	449
Cash flow from operating activities	–19,455	–1,146
Payments for the acquisition of/investments in investment properties, incl. prepayments, refurbishment measures and prepayments for property, plant and equipment	–14,825	–26,184
Payments for investments in/loans to companies accounted for using the equity method	–26,101	–600
Proceeds from loans to companies accounted for using the equity method	792	1,542
Disbursements from the granting of loans to third parties	–60,000	0
Proceeds from the repayment of a purchase price receivable for an investment accounted for using the equity method	8,069	0
Proceeds from the sale of real estate	57,658	1,002
Cash flow from investing activities	–34,407	–24,239

FOREWORD BY THE

INTERIM GROUP

INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19

Consolidated statement of income 20 Consolidated statement of comprehensive income 21 Consolidated balance sheet 22 Consolidated statement of cash flows 24 Consolidated statement of changes in equity 26 Notes to the consolidated financial statements 27

EXECUTIVE BOARD 2

DEMIRE AT A GLANCE 3

MANAGEMENT REPORT 6

IMPRINT 39

CONSOLIDATED STATEMENT OF CASH FLOWS

for the reporting period from 1 January to 30 September 2022

in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022
Payments for borrowing costs	–670	0
Proceeds from borrowings	69,700	0
Interest paid on financial liabilities	–8,963	–9,524
Payments for the purchase of additional shares in a subsidiary	–325	–67
Payments for the redemption of financial liabilities 1	–7,641	–8,910
Buyback of treasury shares	–1,178	0
Payment for the redemption of lease liabilities 1	–293	–120
Cash flow from financing activities	50,630	–18,621
Net change in cash and cash equivalents	–3,233	–44,007
Cash and cash equivalents at the start of the period	101,620	139,619
Cash and cash equivalents at the end of the period	98,388	95,612

The previous year's figures were adjusted based on reporting changes during the period under review

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the reporting period from 1 January to 30 September 2022

	Share capital		Reserves
in EUR thousand	Subscribed capital	Capital reserves	Retained earnings incl. Group profit/loss	Equity attributable to parent company shareholders	Non-controlling interests	Total equity
01/01/2022	105,513	88,366	355,145	549,024	43,339	592,363
Net profit/loss for the period			20,181	20,181	1,697	21,878
Other comprehensive income			0	0	0	0
Total comprehensive income	0	0	20,181	20,181	1,697	21,878
Dividend payments/distributions	0	0	–32,709	–32,709	–830	–33,539
Acquisition of treasury shares	0	0	0	0	0	0
Other changes	0	0	–582	–582	293	–289
30/09/2022	105,513	88,366	342,035	535,914	44,499	580,413

	Share capital Reserves
in EUR thousand	Subscribed capital	Capital reserves	Retained earnings incl. Group profit/loss	Equity attributable to parent company shareholders	Non-controlling interests	Total equity
01/01/2021	105,772	88,404	363,780	557,956	40,085	598,041
Net profit/loss for the period			22,682	22,682	1,893	24,575
Other comprehensive income			0	0	0	0
Total comprehensive income	0	0	22,682	22,682	1,893	24,575
Dividend payments/distributions	0	0	–65,418	–65,418	–574	–65,992
Acquisition of treasury shares	–260	–38	–880	–1,178	0	–1,178
Other changes	0	0	–207	–207	296	89

30/09/2021 105,513 88,366 319,957 513,836 41,700 555,536

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27

IMPRINT 39

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

for the reporting period from 1 January to 30 September 2022

A. General information

1. Basis of preparation

DEMIRE Deutsche Mittelstand Real Estate AG (hereafter "DEMIRE AG") is recorded in the commercial register in Frankfurt am Main, Germany, the location of the Company's headquarters, under the number HRB 89041. The Company's registered office is located in Frankfurt am Main, Germany, and the Company's business address is Robert-Bosch-Strasse 11, Langen, Germany.

The Company's shares are listed in the Prime Standard segment of the Frankfurt Stock Exchange.

The subject of these condensed interim consolidated financial statements as at 30 September 2022 is DEMIRE AG and its subsidiaries (hereafter "DEMIRE").

DEMIRE AG itself has not carried out any investments in real estate or real estate projects to date. Investments are generally processed through real estate companies. Interests in these real estate companies are held by DEMIRE AG either directly or indirectly (through intermediate holding companies). DEMIRE focuses on the German commercial real estate market where it is an active investor and portfolio manager. DEMIRE itself carries out the acquisition, management and leasing of commercial properties. Value appreciation is to be achieved through active real estate management. This may also include the targeted sale of properties when they are no longer a strategic fit or have exhausted their potential for value appreciation.

The condensed interim consolidated financial statements for the period from 1 January to 30 September 2022 were prepared in accordance with the requirements of IAS 34 Interim Financial Reporting (hereafter IAS 34). This report has not been audited or subjected to audit review, and for this reason does not contain an auditor's opinion.

The condensed interim consolidated financial statements of DEMIRE AG were prepared in accordance with the International Financial Reporting Standards (IFRS) published by the International Accounting Standards Board (IASB), as adopted by the European Union (EU), applying Section 315e of the German Commercial Code (HGB). All International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), interpretations of the IFRS Interpretations Committee (IFRS IC) – formerly the International Financial Reporting Interpretations Committee (IFRIC) and the Standing Interpretations Committee (SIC) – that were mandatory for the 2021 financial year have been taken into consideration. Furthermore, all disclosure and explanation requirements under German law above and beyond the provisions of the IASB have been fulfilled.

Under IAS 34, the condensed interim consolidated financial statements shall represent an update of the most recent annual financial statements. They therefore do not contain all of the information and disclosures required for consolidated financial statements but rather concentrate on new activities, events and circumstances so as not to repeat information that has already been reported. The abridged interim consolidated financial statements of DEMIRE AG as at 30 September 2022 should therefore always be read in conjunction with the consolidated financial statements prepared as at 31 December 2021.

The euro (EUR) is the reporting currency of DEMIRE AG's condensed interim consolidated financial statements. Unless otherwise stated, all amounts are expressed in thousands of euros (EUR thousand). For computational reasons, rounding differences of ± one unit (EUR, %, etc.) may occur in the information presented in these financial statements. The consolidated statement of income has been prepared according to the cost-of-sales method.

These condensed interim consolidated financial statements of DEMIRE AG were approved for publication by a resolution of the Executive Board on 17 November 2022.

DEMIRE INTERIM REPORT 1 JANUARY TO 30 SEPTEMBER 2022

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27
IMPRINT	39

B. Scope and principles of consolidation

There were no changes in the scope of consolidation in the 2022 reporting period.

C. Accounting policies

The accounting policies applied to these interim consolidated financial statements are the same as those applied to the consolidated financial statements as at 31 December 2021. There were no material changes in estimates compared to those in the consolidated financial statements as at 31 December 2021.

The amendments to IAS 16, IFRS 3, IAS 37 and the annual improvements to the IFRS, 2018–2020 cycle, which are to be applied for the first time, have no impact on DEMIRE's consolidated financial statements.

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

D. Notes to the consolidated statement of income

1. Earnings before interest and taxes

Profit/loss from the rental of real estate	51,779	47,682
Operating expenses to generate rental income	–26,956	–34,882
Non-allocable operating expenses to generate rental income	–4,400	–6,730
Allocable operating expenses to generate rental income	–22,556	–28,152
Rental revenue from real estate	78,735	82,564
Income from utility and service charges	16,459	22,654
Net rent	62,276	59,910
in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022

Rental revenue in the interim reporting period resulted exclusively from the rental of commercial real estate and is free from seasonal effects.

The decrease in the result from the rental of real estate to EUR 47,682 thousand (9M 2021: EUR 51,779 thousand) is the result of both lower rental income in the amount of EUR 59,910 thousand due to properties sold in the prior reporting period (9M 2021: EUR 62,276 thousand) and an increase in non-allocable operating expenses due to higher maintenance expenses in the amount of EUR 3,616 thousand (9M 2021: EUR 1,565 thousand).

Of the operating expenses, an amount of EUR 28,152 thousand (9M 2021: EUR 22,556 thousand) is generally allocable and can be charged to tenants. The significant increase is mainly due to the sharp rise in energy costs. The increase in non-allocable expenses is also shown in the increase in income from the allocation of service charges.

The result from the sale of properties and property companies amounted to EUR 1,053 thousand as at 30 September 2022 (9M 2021: EUR 738 thousand). The positive result from the sale of properties results exclusively from the sale of an investment in Romania. The income in the comparable period is mainly due to the sale of a property in Cologne.

As in the comparable prior-year period, no revaluation of investment properties was performed as at the 30 September 2022 reporting date. The result from the fair value adjustment of investment property in the amount of EUR 193 thousand (9M 2021: EUR 1,764 thousand) was the change in value of a property in Bremen, which was reclassified to non-current assets held for sale.

Impairments on receivables amounted to EUR 350 thousand in the reporting period (9M 2021: EUR 2,858 thousand). The reason for the high impairments in the previous reporting period was, in particular, the devaluation of an interest receivable of EUR 1,120 thousand as well as impairments on receivables from tenants in the retail and hotel sectors who had experienced economic difficulties due to the effects of the COVID-19 pandemic.

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated
financial statements	27
IMPRINT	39

2. Financial result

1

in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022
Financial income 1	1,925	3,221
Financial expenses	–13,558	–14,081
Profit/loss from companies accounted for using the equity method 1	166	1,421
Minority interests	–3,748	–3,488
Financial result	–15,215	–12,927

The previous year's figures were adjusted based on reporting changes during the period under review

The increase in financial income is mainly due to the granting of loans to the joint venture JV Theodor-Heuss-Allee-GmbH, which was founded in the reporting period, in the amount of EUR 25,150 thousand and its shareholder RFR 5 Immobilien GmbH in the amount of EUR 60,000 thousand.

The profits from companies accounted for using the equity method of EUR 1,421 thousand (9M 2021: EUR 166 thousand) relate to the gains on investments in the reporting period in JV Theodor-Heuss-Allee GmbH, Frankfurt am Main.

The profit shares of minority shareholders in the amount of EUR 3,488 thousand (9M 2021: EUR 3,748 thousand) are profit shares of the minority shareholders of the subsidiaries of Fair Value REIT-AG, which are recognised as debt according to IAS 32. The decrease compared to the same period of the previous year is mainly due to lower income.

3. Earnings per share

in EUR thousand	01/01/2021 – 30/09/2021	01/01/2022 – 30/09/2022
Net profit/loss for the period (in EUR thousand)	24,575	21,879
Profit/loss for the period less non-controlling interests	22,682	20,181
Number of shares (in thousands)
Number of shares outstanding as at the reporting date	105,513	105,513
Weighted average number of shares outstanding	105,513	105,513
Impact of conversion of convertible bonds and exercise under the 2015 Stock Option Programme	510	510
Weighted average number of shares (diluted)	106,023	106,023
Earnings per share (in EUR)
Basic earnings per share	0.21	0.19
Diluted earnings per share	0.21	0.19

As at 30 September 2022, the Company had potential ordinary shares outstanding from the 2015 Stock Option Programme entitling the owners to subscribe to 510,000 shares.

DEMIRE INTERIM REPORT 1 JANUARY TO 30 SEPTEMBER 2022

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27

IMPRINT 39

E. Notes to the consolidated balance sheet

1. Investment properties and non-current assets held for sale

Investment properties are measured at fair value. They developed as follows during the interim reporting period:

in EUR thousand	Office	Retail	Logistics	Other	Total
Fair value at the beginning of the 2022 financial year	843,956	377,559	141,600	69,980	1,433,096
Additions of properties	5,343	3,529	11,992	2,297	23,161
Reclassifications to non-current assets held for sale	–3,288	0	0	0	–3,288
Fair value as at 30/09/2022	846,010	381,088	153,592	72,277	1,452,968

The additions to investment property totalling EUR 23,161 thousand consist mainly of capitalised current investments of EUR 22,168 thousand and contractual amendments to a hereditary building right of EUR 993 thousand.

The reclassification to non-current assets held for sale in the amount of EUR 3,288 thousand relates to a commercial property in Bremen. The transfer of benefits and obligations took place on 1 November 2022.

The fair value measurement of investment properties is allocated to Level 3 of the valuation hierarchy in accordance with IFRS 13 (measurement based on unobservable input factors). DEMIRE determines fair values within the framework of IAS 40 accounting. No revaluation of investment properties was performed as at the 30 September 2022 reporting date.

2. Equity

Subscribed capital amounted to EUR 107,777 thousand (31 December 2021: EUR 107,777 thousand). This was EUR 105,513 thousand after the deduction of treasury shares (31 December 2021: EUR 105,513 thousand). Following the proposal of the Executive Board and Supervisory Board, the Annual General Meeting of 18 May 2022 resolved to distribute a dividend of EUR 0.31 (previous year: EUR 0.62) per dividend-bearing share and to carry forward the Company's remaining accumulated profit as at 31 December 2021. The distribution amount came to EUR 32,709 thousand (previous year: EUR 65,418 thousand). EUR 204 thousand (previous year: EUR 950 thousand) will be carried forward.

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

3. Financial liabilities

Financial liabilities consisted of the following:

in EUR thousand	31/12/2021	30/09/2022
2019/2024 corporate bond	594,047	595,611
Other financial liabilities	296,467	290,701
Total	890,514	886,312

The following table shows the nominal value of financial liabilities:

FINANCIAL LIABILITIES
in EUR thousand	31/12/2021	30/09/2022
2019/2024 corporate bond	600,000	600,000
Other financial liabilities	297,866	284,528
Total	897,866	884,528

The difference between the carrying amounts of financial liabilities and their nominal values is due to the subsequent measurement of financial liabilities at amortised cost using the effective interest method in accordance with IFRS 9.

With the exception of the loan from IC Fonds & Co. Gewerbeobjekte Deutschland 15. KG, all of the Group's financial liabilities have fixed interest rates. The nominal interest rate of the 2019/2024 corporate bond is 1.875% p.a. Other financial liabilities mainly include financial liabilities to banks at a weighted average nominal interest rate of 1.24% p.a. as at 30 September 2022 (31 December 2021: 1.31% p.a.). The average nominal interest rate on debt across all financial liabilities was 1.67% p.a. as at 30 September 2022 (31 December 2021: 1.66% p.a.).

The change in other financial liabilities during the interim period under review is due to current repayments.

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27

IMPRINT 39

F. Condensed Group segment reporting

01/01/2022– 30/09/2022

in EUR thousand	Core Portfolio	Fair Value REIT	Corporate functions/ others	Group
Total revenue	64,573	17,991	1,053	83,617
Segment revenue	65,227	18,064	1,192	84,483
Segment expenses	–29,718	–8,059	–5,545	–43,323
EBIT	35,509	10,005	–4,354	41,160
Net profit/loss for the period	19,836	4,720	–2,679	21,879
Segment assets 30/09/2022	1,245,148	342,745	106,980	1,694,870
Thereof tax assets	3,764	47	3,827	7,639
Thereof additions to non-current assets	19,781	3,379	0	23,161
Thereof non-current assets held for sale	3,490	0	0	3,490
Segment liabilities 30/09/2022	912,339	187,720	14,398	1,114,457
Thereof non-current financial liabilities	793,002	73,726	521	867,250
Thereof lease liabilities	25,364	0	24	25,388
Thereof current financial liabilities	13,404	2,813	2,846	19,062
Thereof tax liabilities	1,603	0	9,142	10,745

	Core		Corporate functions/
in EUR thousand	Portfolio	Fair Value REIT	others	Group
Total revenue	111,554	24,991	0	136,545
Segment revenue	113,503	25,420	59	138,982
Segment expenses	–74,803	–14,668	–6,956	–96,427
EBIT	38,700	10,752	–6,897	42,555
Net profit/loss for the period	24,895	5,402	–5,723	24,575
Segment assets 31/12/2021	1,262,560	342,850	100,184	1,705,594
Thereof tax assets	3,718	47	2,602	6,369
Thereof additions to non-current assets	22,679	5,829	0	28,508
Thereof non-current assets held for sale	0	0	0	0
Segment liabilities 31/12/2021	914,657	187,043	11,531	1,113,232
Thereof non-current financial liabilities	798,534	75,883	0	874,417
Thereof lease liabilities	24,448	0	25	24,472
Thereof current financial liabilities	13,350	2,747	0	16,097
Thereof tax liabilities	1,892	0	6,777	8,670

01/01/2021– 30/09/2021

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27
IMPRINT	39

The segmentation of the data in the financial statements is based on the internal alignment according to strategic business segments pursuant to IFRS 8. The segment information presented represents the information to be reported to the Executive Board.

The DEMIRE Group is divided into the two reportable business segments Core Portfolio and Fair Value REIT.

The joint venture JV Theodor-Heuss-Allee-GmbH, Frankfurt am Main, accounted for using the equity method, and the fully consolidated company Cielo BVO GmbH, Frankfurt am Main, were allocated to the Core Portfolio operating segment due to their similar commercial characteristics.

More than 10% of total revenue was generated from one customer in the Core Portfolio segment, corresponding to a total of EUR 9,378 thousand (9M 2021: EUR 10,620 thousand) during the reporting period.

FOREWORD BY THE EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP MANAGEMENT REPORT	6
INTERIM CONSOLIDATED FINANCIAL STATEMENTS	19
Consolidated statement of income	20
Consolidated statement of comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of cash flows	24
Consolidated statement of changes in equity	26
Notes to the consolidated financial statements	27
IMPRINT	39

G. Other disclosures

1. Related party disclosures

DEMIRE AG has a loan receivable in the amount of EUR 25,837 thousand (including interest receivable) from the joint venture JV Theodor-Heuss-Allee-GmbH. Interest income from this loan comes to EUR 789 thousand as at 30 September 2022. In addition, an asset management agreement and an agency agreement exist between DEMIRE AG and the purchasing company JV Theodor-Heuss-Allee-GmbH, resulting in receivables of EUR 6 thousand and income of EUR 56 thousand as at 30 September 2022. In the year under review, DEMIRE received a distribution from G+Q Effizienz GmbH in the amount of EUR 90 thousand (previous year: EUR 79 thousand) and from DEMIRE Assekuranzmakler GmbH & Co. KG in the amount of EUR 0 thousand (previous year: EUR 92 thousand). Furthermore, there were no business transactions with members in key Company positions during the reporting period, except for the compensation of the Executive Board mentioned in Section G.5.

2. Financial instruments

The carrying amounts of the following financial instruments carried at cost or amortised cost do not correspond to their fair values:

		31/12/2021		30/09/2022
in EUR thousand	Carrying amount under IFRS 9	Fair value	Carrying amount under IFRS 9	Fair value
Loans to companies accounted for using
the equity method	26,505	26,457	25,563	19,932
Loans and financial assets	68,189	68,022	67,878	55,807

		31/12/2021	30/09/2022
in EUR thousand	Carrying amount under IFRS 9	Fair value	Carrying amount under IFRS 9	Fair value
Bonds	594,047	592,848	595,611	439,308
Other financial liabilities	296,467	292,646	290,701	262,836

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27
IMPRINT	39

3. Risk report

Please refer to the disclosures made in the risk report in the consolidated financial statements as at 31 December 2021 for information on the risks to future business performance. In addition to the opportunities and risks recorded as at 31 December 2021, the current financial year has largely been dominated by high inflation, in particular the sharp rise in energy costs, higher interest rates and the war in Ukraine. All of these factors create a high degree of uncertainty and a clouding of prospects in the economic environment, but this has not yet had a material impact on DEMIRE's key performance indicators. Both rental payments and funds from operations (after taxes, before minority interests) are in line with our expectations. Nevertheless, DEMIRE's Executive Board is closely monitoring whether and how the economic environment is changing and may possibly have an impact on the performance of the portfolio, for example. The risks are reviewed continuously and in a structured process. From today's perspective, no risks that could endanger the Company have been identified.

For a general overview of the risks, please refer to the report on risks and opportunities.

4. Other notes

As at the reporting date, there were no financial obligations stemming from purchase agreements for properties and real estate companies which are not yet due.

Contractual obligations for modification and expansion measures as well as maintenance and modernisation obligations for the properties totalled EUR 16,114 thousand as at 30 September 2022 (9M 2021: EUR 48,454 thousand).

Purchase order commitments for maintenance and modernisation, as well as modification and expansion measures, totalled EUR 4,605 thousand as at the interim reporting date (9M 2021: EUR 12,235 thousand).

As at 30 September 2022, unused credit lines in the amount of EUR 6,000 thousand (31 December 2021: EUR 5,000 thousand) were available.

DEMIRE INTERIM REPORT 1 JANUARY TO 30 SEPTEMBER 2022

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27
IMPRINT	39

5. Governing bodies and employees

In accordance with DEMIRE AG's Articles of Association, the Executive Board is responsible for managing business activities.

The following were members of the Executive Board during the interim period under review and comparable prior-year period:

Mr Ingo Hartlief (Chairman of the Executive Board since 20 December 2018)

Mr Tim Brückner (Chief Financial Officer since 1 February 2019)

For the interim reporting period, performance-related remuneration of EUR 385 thousand (9M 2021: EUR 521 thousand), fixed remuneration of EUR 548 thousand (9M 2021: EUR 524 thousand) and share-based remuneration of EUR –429 thousand (9M 2021: EUR 113 thousand) were recognised for the Executive Board of DEMIRE AG.

No loans or advances were granted to the members of the Executive Board, nor were any contingent liabilities in favour of the members of the Executive Board entered into either.

6. Events after the interim reporting date of 30 September 2022

In July 2022, the property in Bremen (Walter-Gerdes-Straße) was sold for EUR 3,490 thousand, resulting in a reduction in the carrying amount of EUR 3,288 thousand. The transfer of ownership, benefits and obligations took place on 1 November 2022. Furthermore, no events occurred that are of particular significance for DEMIRE's net assets, financial position and results of operations.

Frankfurt am Main, 17 November 2022

DEMIRE Deutsche Mittelstand Real Estate AG

Ingo Hartlief (FRICS) (CEO)

Tim Brückner (CFO)

FOREWORD BY THE
EXECUTIVE BOARD	2
DEMIRE AT A GLANCE	3
INTERIM GROUP
MANAGEMENT REPORT	6
INTERIM CONSOLIDATED
FINANCIAL STATEMENTS	19
Consolidated statement
of income	20
Consolidated statement of
comprehensive income	21
Consolidated balance sheet	22
Consolidated statement of
cash flows	24
Consolidated statement of
changes in equity	26
Notes to the consolidated
financial statements	27

IMPRINT 39

Ingo Hartlief (FRICS) (CEO)

we hereby affirm that, to the best of our knowledge, the consolidated financial statements give a true and fair view of the Group's net assets, financial position and results of operations in accordance with the applicable accounting principles and that the Group management report gives a true and fair view of the development and performance of the business, including the business results and the position of the Group, together with a description of the principal opportunities and risks associated with the Group's expected development.

As members of the Executive Board of DEMIRE Deutsche Mittelstand Real Estate AG,

Frankfurt am Main, 17 November 2022

DEMIRE Deutsche Mittelstand Real Estate AG

Declaration by the executive directors

Tim Brückner (CFO)

FOREWORD BY THE EXECUTIVE BOARD DEMIRE AT A GLANCE INTERIM GROUP MANAGEMENT REPORT INTERIM CONSOLIDATED FINANCIAL STATEMENTS 19

IMPRINT 39

IMPRINT

COMPANY CONTACT

2	DEMIRE Deutsche Mittelstand Real Estate AG
3	Robert-Bosch-Straße 11
	63225 Langen Germany
	T + 49 (0) 6103 – 372 49 – 0
6	F + 49 (0) 6103 – 372 49 – 11
	ir@demire.ag
	www.demire.ag

PUBLISHER

The Executive Board of DEMIRE Deutsche Mittelstand Real Estate AG

CONCEPT AND LAYOUT

Berichtsmanufaktur GmbH, Hamburg

PUBLICATION DATE

17 November 2022