Altarea

Earnings Release • Jul 31, 2014

Disclaimer

• This presentation is not an offer to sell, a solicitation of an offer to sell or exchange securities, nor does it represent a recommendation to buy or to sell Altarea securities.
• The distribution of this document in some countries may be restricted by law or regulation. As such, persons into whose possession this presentation may come are obliged to inform themselves of and to observe any such restrictions. To the extent permitted by applicable law, Altarea Cogedim disclaims any responsibility or liability for the violation of any such restrictions by any person.

INTRODUCTION	P. 4
HY 2014 ACHIEVEMENTS	P. 7
FINANCE		P. 22
APPENDICES		P. 31

3

INTRODUCTION

	 Increase in tenant revenue (+2,9% l-f-l growth in France)  Growth in the pipeline - success in the development of new businesses
GOOD OPERATING PERFORMANCES	Sound sales growth (+22% in value and +43% in volume (1)) driven by sales to  institutional investors and the new entry-level and mid-range lines of products
	 Strong operational activity, with the completion of many contracts
ON-GOING	 Focus on large and controlled assets (portfolio and pipeline)
TRANSFORMATION DYNAMIC IN ALL	 Growth in volume and increase in the market share
BUSINESS LINES	 Ramp-up of the model (investor, developer, project manager)
	 Diluted going concern NAV:	€1,596.3 million €127.6/share	+2.7% - 4.9%
FINANCIAL RESULTS
	 FFO (Group share):	€84.6 million	+3.1 %
		€5.53/share	- 13.8%

(1) +17% in value and +38% in volume like-for-like (excluding the acquisition of Histoire & Patrimoine).

5

• Sound financial structure (LTV: 41.6%, cash available: 580 M€, no corporate repayment before 2017)
• A very strong pipeline of projects
• A roadmap for 2017/2018

A STRONG VALUE CREATION POTENTIAL
 Retail pipeline: Development spread >300 bps	€1.8 bil. of investments
 Residential properties for sale and future offering:	€4.7 bil. of potential revenue tax incl.	indicators
Offices project portfolio (1): 	€1,3 bil. of asset value

GROUP ROADMAP

• Massive deleveraging achieved: substantial reduction of the risk profile
• Short-term impact: limited dilution of the per-share
• Capacity to finance an important pipeline of sizable (2 million m² (2)) and profitable projects
• Expected 2017-2018 impact: strong growth of the per-share indicators (NAV, FFO, dividend)

(1) Pipeline of secured projects (i.e. excluding identified projects without a signed option on the land), value = rent capitalized at 6%.

HALF-YEAR 2014 ACHIEVEMENTS

• Focus on large assets and projects
• Control on strategic assets optimised through partnerships
• Group equity reallocated to high added-value developments

Partners: APG, Predica 694,300 GLA ft² (64,500 m²) MGR: €31.6 million

Partner: Allianz 604,900 GLA ft² (56,200 m²) MGR: €13.6 million

Partner: Orion 462,600 GLA ft² (42,980 m²) MGR: €18.9 million

CASE STUDIES (ASSETS) CASE STUDIES (PROJECTS)

Partner: Allianz 548,900 GLA ft² (51,000 m²) MGR: €11.1 million

• Strong operational performance of French assets (86% of the portfolio)
• Stabilization of rental values and tenant revenue in Spain and Italy (14% of the portfolio)

VALUE OF PORTFOLIO ASSETS (in € billion)	OPERATIONAL PERFORMANCE - FRANCE (controlled assets)
(2) Joint-control 14% Controlled (1) Assets Assets managed 18% parties (3) for third 68%	(4) (Jan.-May) +2.6% Rental income -0.1% CNCC Like-for like change in net rental +2.9% income France ratio (5) Occupancy cost 9.7% (6) Bad debt 2.4% rate (7) Financial vacancy 3.3% Number of assets 36
TOTAL VALUE: €4.3 billion o/w Group share: €2.5 billion	Average value €83 million + 11%

• (1) Assets of which Altarea holds shares and for which Altarea exercises operational control. Fully consolidated in the consolidated financial statements.
• (2) Assets of which Altarea is not the majority shareholder, but for which Altarea exercises joint operational control or substantial influence. Consolidated using the equity method in the consolidated financial statements.
• (3) Assets held entirely by third parties who entrusted Altarea with a management mandate for an initial period of three to five years, renewable.
• (4) Like-for-like revenue change for shopping center tenants over the five first months of 2014, at 100%.
• (5) Calculated as rent and expenses charges to tenants (incl. taxes) over the past 6 months (including rent reductions), in proportion to sales over the same period (incl. taxes).
• (6) Net amount of allocations to and reversals of provisions for bad debt plus any write-offs during the period as a percentage of total rent and expenses charged to tenants.
• (7) Estimated rental value (ERV) of vacant lots as a percentage of total estimated rental value. Excluding property being redeveloped.

RETAIL QWARTZ: THE 1 ST CONNECTED SHOPPING CENTER

• A « digital » positioning as a competitive advantage
• Unique merchandising and entertainments: M&S, Primark, « Cité du e-commerce », Qwartz & Co…

• Very high number of visits

• An average development spread of 300 bp (1)

• A pipeline of premium projects
• The pipeline potentially represents 80% of the standing portfolio (2)

Surface area GLA	5,026,746 ft² (467,000 m²)
o/w refurbishments/ extensions	1,819,101 ft² (169,000 m²)
o/w creations	3,207,645 ft² (298,000 m²)
Net investments o/w Group share	€1.815 bil. €1.264 bil.
Provisional gross rental income o/w Group share	€160 mil. €109 mil.
Yield	8.8%

(1) Difference between the yield of the projects under development and the estimated capitalization rate at opening.

(2) Share of pipeline rents in proportion to share of rents of existing assets (80% in Group share and 78.4% at 100%).

(3) Group share: €138.5 million.

(4) Group share: €247.7 million.

• An ambitious cross-canal program to modernise the Paris-Montparnasse train station, in line with the Group's strategy (large and premium location, "railway retail")
• Expertise of Altarea (3rd program after the Paris East Station and the Paris North Station)

RETAIL HIGH-STREET RETAIL: A NEW PRODUCT LINE

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• Deep market, strong expectations from local authorities
• Development synergies: Retail, Residential & Offices business lines
• "Lease and sell" business model and substantial contribution to FFO starting 2015 / 2016

E-COMMERCE REPOSITIONING OF RUE DU COMMERCE

• Offer refocused on the "man universe" with more than 1,200 brands ("High-Tech Home appliances DIY")
• Decrease in volumes in the other universes
• Higher commissions on reinforced universes

Advertising campaign launched in June 2014 targeting men

STRONGER MARKETING TARGETING INDICATEURS OPÉRATIONNELS

Number of unique visitors	(1)	5 million
#8 general merchant	website in France
Business volume	€172 mil.	-6%
o/w Retail o/w Galerie	€119 mil. €53 mil.	-11% +6%
Galerie commissions	€5,1 mil.	+ 12%

• Increase in volumes and gain of market shares
• Strengthen the offer on entry-level and mid-level ranges of products

• Growth of sales to institutional investors

• Reservations driven by sales to institutionals and the success of the new offer

• HY margins reflect the current period of transition (2)
• Good performance of the operating cash-flow excluding the impact of Laënnec (2013)

RESERVATIONS: +43%(1)	OPERATIONAL KPI
Upscale 28%	(1) Reservations Reservations (no. of units)	€535 mil. +22% 2,152 +43%
	Revenue	€368 mil. -19% -4% excluding Laënnec
Entry-level and mid-range 60%	Operating income	€16.2 mil. -46%
Serviced Residences 8%		+22% excluding Laënnec
4% Renovation	(3) Backlog	€1,395 bil. +5% 20 mois + 3 mois
2 152 units	and Portfolio(4) Offering	€4,677 bil. +6%

• (1) +17% in value and +38% in volume l-f-l (excluding acquisition of Histoire & Patrimoine).
• (2) Increase in volumes at lower margins in order to get back to the same level of net income, in absolute value, as seen in previous years.
• (3) The backlog comprises revenues excluding tax from notarized sales to be recognized on a percentage-of-completion basis and individual and block reservations to be notarized.

• (4) Properties for sale include units available for sale (expressed as revenue incl. tax), and the future offering is made up of programs at the development stage (through sales commitments, almost exclusively unilateral in nature) that have yet to be launched (expressed as revenue incl. tax).

• Cluttered area close to Annecy and Lyon, strong attraction of the Swiss border, dynamic demography

• Mid-range program ideally located
• Strong interest from investors attesting the relevance of the new positioning of the Group

LOGEMENT FORTE CROISSANCE DES VENTES (+43% EN VOLUME) RESIDENTIAL ACQUISITION OF 55% OF HISTOIRE & PATRIMOINE (€15.5 MILLION)

• Leader in the renovation of urban heritage listed or classified as an historic monument
• A complementary expertise in favor of new business for the Group (sales synergies / development)
• Immediate contribution to 2014 revenue & earnings

Hôtel Voysin - Paris

architectural heritage Mansion Industrial heritage Cité Meissonnier - Saint Denis

CASE STUDIES HISTOIRE & PATRIMOINE

• Inception in 2004
• 100 employees
• € 100 million annual investment
• Present throughout the French territory

• A comprehensive real estate service offer for Cities willing to preserve their

• A comprehensive business model « investor, developer, project manager»

• Ability to provide a tailor-made solution for any type of demand
• A favorable market environment

INVESTMENT VIA ALTAFUND(1) DEVELOPMENT (Off-plan sales / property development contracts) SERVICES (delegated project management) Neuilly-sur-Seine Tour Blanche La Défense Mutuelle des Motards Head Office Montpellier

272,327 ft² – 25,300m² 96,875 ft² – 9,000 m² 319,688 ft² – 29,700 m²

OFFICES LEVERAGING THE BUSINESS MODEL

• Strong activity: many deals completed this semester
• Operating cash-flow up +21% at €8.7 million

OPERATION DEVELOPED DURING THE SEMESTER

New project Toulouse-Blagnac (off-plan lease signed - Safran)

New project Lyon - Gerland (off-plan lease signed - Sanofi)

PORTFOLIO OF PROJECTS UNDE DEVELOPMENT AS OF 30 JUNE 2014

Project by nature	Surface at 100%	Group share in value
AltaFund(1)	430,556 ft² 40,000 m²	€347 mil.
Property development contracts/ off-plan sales(2)	3,552,090 ft² 330,000 m²	€825 mil.
Delegated project management(3)	586,633 ft² 54,500 m²	€122 mil.
Total	4,569,280 ft² 424 500 m²	€1 294 mil.

(1) Investment. Value = cost price at 100%.

(2) Contract signed, land controlled. Value = price at the signature.

(3) Contract signed. Value = capitalized fees.

OFFICES RASPAIL, AN EXEMPLARY PROJECT

• Less than 2 years to execute the entire project (acquisition, restructuring, renting, disposal)
• La Française as tenant / investor
• Operator: Altafund / Promotor: Cogedim Entreprise (Property development contracts)

DYNAMIC SEMESTER IN FINANCING	 €866 million of corporate financing signed this semester  Evolution in the financing mix (mortgage / corporate banking loans / credit markets)  An optimised structure
LIMITED DILUTION	(1)  FFO consolidated :	€84.6 million +3.1 % €5.53/share - 13.8%
OF THE PER-SHARE INDICATORS	 Diluted going concern NAV:	€1,596.3 million +2.7% €127.6/share - 4.9%

• Increased access to credit markets (private bond issue and treasury note)

• An optimised average cost

• Very solid ratios

• No issue for the coming mortgage reimbursements

• No corporate issue before 2017 (duration of corporate debt: 5.1 years)

• Decline in the contribution from Residential (2013 perimeter includes Laënnec) and E-commerce

• Partially offset by strong performances in brick-and-mortar Retail and Office property

• Growth in consolidated FFO at €84.6 million (+3.1%)

• FFO/share: €5.53 (-13.8%)

• Significant impact of financial instruments income (swaps and fixed-rate debt) and taxes

• Equity raised over the past 12 months: 42% of the market capitalisation

• Limited dilution of FFO per share

• Substantially improved risk profile (LTV at 41.6%, vs. 47.6% as of 30 June 2013)

• €570 million of equity raised during the past 12 months

• − Allianz partnership: €395 mil.
• − Capital increases: €173 mil. (1)

(1) €156 million raised through the 2013 and 2014 subscription of script dividend and € 17 million resulting from the AREAL project. I.e. a total number of new shares created representing 14,9% of the number of shares in circulation as of 30 June 2013.

• Diluted going concern NAV up +2.7% at €1,596 million

• On a per-share basis, a 4.9% decline to €127.6/share

• Dilutive impact of the script dividend in 2014 (4) (8% increase in the outstanding number of shares)

• Mark-to-market impact on the financial instruments and the fixed-rate debt

(1) Diluted going concern NAV: Market value of equity from the perspective of continuation, recognizing all shares subscribed in the payment of dividends in shares. // EPRA NAV: €131.0/share (-2.9%) / EPRA NNNAV (liquidation NAV): €122.5 /share (-4.8%).

(2) Accounting for the 2013 fiscal year.

(3) Change in value of assets, calculated expenses (depreciation and provisions…)as well as the recognition of deffered tax assets.

(4) 922,692 new shares issued at €108.3/share

Expected dilution in the per-share FFO slightly above 10% in 2014, as a result of the recent operations which enabled to strongly enhance the balance sheet

Dividend of €10.00/share

	06/30/2014			06/30/2013 restated			06/30/2013 published
In € million	operations	Funds from (FFO)	Changes in value , estimated expenses and transaction costs	TOTAL	Funds from operations (FFO)	Changes in value , estimated expenses and transaction costs	TOTAL	Funds from operations (FFO)
Shopping centers	84.9	8%	(27.1)	57.8	78.8	71.4	150.1	80.0
Online retail	(6.5)	10%	(0.5)	(7.0)	(5.9)	(3.8)	(9.7)	(5.9)
Residential	16.2	(46)%	(2.7)	13.5	30.2	(1.9)	28.3	30.2
Offices	8.7	21%	2.5	11.2	7.2	(1.7)	5.5	7.2
Other	(0.4)	51%	(3.5)	(3.9)	(0.3)	(1,3)	(1.6)	(0.3)
OPERATING INCOME	102.7	(7)%	(31.3)	71.5	109.9	62.8	172.7	111.2
Net borrowing costs	(16.5)	(36)%	(2.7)	(19.1)	(25.8)	(2.8)	(28.6)	(27.2)
Changes in value and profit / (loss) from disposal of financial instruments	-		(44.5)	(44.5)	-	27.1	27.1	-
Proceeds from the disposal of investments	-		0.0	0.0	-	(0.0)	(0.0)	-
Corporate income tax	(1.7)		82.3	80.6	(2.0)	(2.6)	(4.6)	(2.0)
NET PROFIT	84.6	3%	3.8	88.4	82.0	84.5	166.5	82.0
Income attributable to equity holders of the parent	64.4	(8)%	2.6	67.0	69.9	65.4	135.3	69.9
Average diluted number of shares (in mil.)	11.645				10.904			10.904
FFO (group share)/share	€5.53	(14)%			€6.41			€6.41

In € million	06/30/2014	12/31/2013
NON-CURRENT ASSETS	3,646.6	3,600.7
Intangible assets	240.7	237.7
o/w goodwill	128.7	128.7
o/w brands	97.7	98.6
Other intangible assets	14.3	10.4
Property. plant and equipment	11.7	12.6
Investment properties	2,963.4	3,029.0
o/w investment properties in operation at fair value	2,805.6	2,917.9
o/w investment properties under development and under construction at cost	157.8	111.1
Securities and investments in equity affiliates and unconsolidated interests	305.0	278.6
Loans and receivables (non-current)	6.9	6.6
Deferred tax assets	115.0	36.2
CURRENT ASSETS	1,439.8	1,292.2
Non-current assets held for sale	80.2	1.7
Net inventories and work in progress	569.6	606.4
Trade and other receivables	398.4	428.2
Income tax credit	2.7	2.3
Loans and receivables (current)	18.3	18.1
Derivative financial instruments	0.7	0.8
Cash and cash equivalents	369.8	234.9
TOTAL ASSETS	5,082.8	4,892.9

BALANCE SHEET (2/2)

In € million	06/30/2014	12/31/2013
EQUITY	1,880.8	1,832.9
Equity attributable to Altarea SCA shareholders	1,202.4	1,151.3
Share capital	191.2	177.1
Other paid-in capital	518.7	437.0
Reserves	425.5	391.0
Income associated with Altarea SCA shareholders	67.0	146.2
Equity attributable to minority shareholders of subsidiaries	678.4	681.6
Reserves associated with minority shareholders of subsidiaries	547.9	498.8
Other equity components, subordinated perpetual notes	109.0	109.0
Income associated with minority shareholders of subsidiaries	21.5	73.8
NON-CURRENT LIABILITIES	1,903.6	1,782.5
Non-current borrowings and financial liabilities	1,846.6	1,722.7
o/w participating loans	43.5	12.7
o/w non-current bond issues	476.9	248.5
o/w borrowings from credit institutions	1,325.9	1,432.3
o/w other borrowings and debt	0.4	29.2
Other non-current provisions	19.5	21.1
Deposits received	27.6	26.8
Deferred tax liability	9.8	11.9
CURRENT LIABILITIES	1,298.2	1,277.6
Current borrowings and financial liabilities	493.2	436.2
o/w bonds	1.6	0.2
o/w borrowings from credit institutions (excluding overdrafts)	353.5	323.4
o/w treasury notes and accrued interest	61.0	28.0
o/w bank overdrafts	8.4	39.7
o/w other borrowings and debt	68.6	44.9
Derivative financial instruments	115.2	73.7
Accounts payable and other operating liabilities	663.4	739.5
Tax due	26.4	28.1
Amount due to shareholders	0.0	0.0
TOTAL LIABILITIES	5,082.8	4,892.9

GROUP NAV	06/30/2014				12/31/2013
	In € million	Change	€/share	Change /share	In € million	€/share
Consolidated equity, Group share	1,202.4		96.1		1,151.3	99.3
Other unrealized capital gains	299.0				317.6
Restatement of financial instruments	114.8				71.5
Deferred tax on the balance sheet for non-SIIC assets (international assets)	22.6				23.4
EPRA NAV	1,638.8	4.8%	131.0	(2.9)%	1,563.9	134.9
Market value of financial instruments	(114.8)				(71.5)
Fixed-rate market value of debt	(8.1)				(2.3)
Effective tax for unrealized capital gains on non-SIIC assets*	(26.5)				(32.1)
Optimization of transfer duties *	57.8				48.7
Partners' share**	(14.7)				(15.4)
EPRA NNNAV (liquidation NAV)	1,532.5	2.8%	122.5	(4.8)%	1,491.2	128.7
Estimated transfer duties and selling fees	64.3				63.6
Partners' share**	(0.6)				(0.7)
Diluted Going Concern NAV	1,596.3	2.7%	127.6	(4.9)%	1,554.1	134.1
* Varies according to the type of disposal, i.e. sale of asset or sale of securities.

** Maximum dilution of 120,000 shares.

*** Number of diluted shares. 12,513,889 11,590,807