ABACUS GROUP — Capital/Financing Update 2011

Jun 26, 2011

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ASX ANNOUNCEMENT

Abacus and Heitman form new joint venture

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Abacus Property Group (ASX: ABP), and the multi-national real estate investment management firm Heitman LLC (Heitman) are pleased to announce the formation of a joint venture to invest in core-plus office, retail and industrial properties in major Australian gateway cities. The first asset to be acquired by the joint venture is a commercial office building at 32 Walker St, North Sydney.

The total consideration for the acquisition of the Walker Street property is $35.6 million, excluding transactions costs, which represents an initial yield of 9.6% pa. This modern 13 level A-grade property is located in a prime position in the North Sydney office market opposite North Sydney train station and adjacent to Greenwood Plaza. The property boasts panoramic harbour and city views from all levels while delivering excellent natural light. The property comprises 6,619m[2] of net lettable area including 12 levels of office accommodation and the Station Hotel on the ground floor. The property has 31 car parking spaces. It is close to fully occupied and has a weighted average lease expiry of circa 3 years.

Under the terms of the joint venture, the parties will contribute equity of up to $266 million with targeted gross assets of approximately $600 million. Heitman, on behalf of a global institutional investor, will provide 75% of the equity and Abacus will provide the remaining 25%. Abacus will provide local property management services to the joint venture and share in the asset management responsibilities with Heitman.

Abacus Property Group CEO, Dr Frank Wolf said that Abacus is “extremely pleased to be announcing the formation of a new joint venture with Heitman. Abacus’ business model is focused on pursuing stand out core-plus assets with value add characteristics. Aligning our company with Heitman, an institutional partner with complimentary investment objectives, demonstrates the successful implementation of our third party capital strategy”.

Maury Tognarelli, Chief Executive Officer of Heitman said that “Heitman views this as an attractive opportunity to continue our global expansion by replicating our 30-year experience investing with strong joint venture partners. In Abacus Property Group we have found a firm with a history of identifying value and delivering results, and that fits well with our focus on making real estate investments that perform well today and that we expect will deliver significant value over time to our investors”.

Abacus Property Group is a diversified property group that specialises in investing in core plus property opportunities across Australia's commercial property markets. Abacus was established in 1996 and listed on the ASX in November 2002. Abacus has achieved a successful track record of acquiring property based assets and actively managing those assets to enhance income and capital growth.

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Founded in 1966 and headquartered in Chicago, Heitman manages approximately US$23 billion in assets invested directly and indirectly in real estate in North America, Europe and Asia. The firm's clients include US and international institutions, pension plans, endowments and foundations, and individual investors. Additional information about Heitman can be obtained from its website at www.heitman.com.

Dr Frank Wolf Managing Director

27 June 2011

Neil Summerfield Head of Investor Relations

Abacus Property Group (+61) 2 9253 8600 www.abacusproperty.com.au.

Lewis Ingall Senior Managing Director Heitman LLC (+1) 312 541 6772

Heitman Media Contact Margot Olcay Rubenstein Molcay@rubenstein.com (+1) 212 843 8284

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