BLACKWALL LIMITED - Annual Report 2015

19!August!2015!

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BWF'ASX'Release'

30 June'2015'–'Full'Year'Result

Our!operating!income!has!grown!by!22%!over!the!past!12!months!to!$5.8!million.!As!a!consequence! the!Directors!have!resolved!to! increase'the'full'year'dividend'by'20% .!

A! final' fully' franked' dividend' of' 1.7' cents' per' share ! will! be! paid! on! 6! November! 2015.! This! brings!the!full!year!dividend!to!3!cents!per!share!(fully!franked).!!

Key$Numbers$

OperatingIncome	$5,780,000
InvestmentIncome	$310,000
TransactionFees	$250,000
Revaluations	$2,690,000
TotalRevenue	$9,030,000
Expenses	($4,840,000)
Tax,Depreciation&Interest	($1,370,000)
NPAT	$2,820,000

EPS	$0.06
NetAssets	$16.9million
NTApershare	$0.34
Sharesonissue	50.4million

Operating$Income$

Our!operating!businesses!generate!recurring!management!fees!from!income!producing real!estate! and! property! investment! trusts.! Our! growing! subsidiary,! WOTSO! WorkSpace! (www.wotsoworkspace.com.au)!sells!short^term!serviced!office!and!workspace!accommodation!at! locations!in!Sydney!(Neutral!Bay,!Pyrmont!and!North!Strathfield),!the!Gold!Coast!and!the!ACT.!

2015	2015	2014
ManagementFees	$3,917,000	$3,524,000
WOTSOWorkSpaceSales	$1,863,000	$1,230,000

We! manage! 10! real! estate! investment! trusts! capitalised! by! around! 2,000! wholesale! and! retail! investors! controlling! over! $500! million! of! income! producing! property.! Our! diversified! REIT,! BlackWall!Property!Trust,!is!listed!on!the!ASX!under!the!code!BWR.!

WOTSO! operates! 5,500! sqm! of! space! with! current! annualised! turnover! of! $3! million.! Of! this,! roughly! 40%! has! been! in! operation! for! less! than! 12! months.! Sustainable! occupancy! is! generally! built! over! a! two! to! three! year! period.! The! business! is! also! expanding! its! offer! by! developing! laboratory,!commercial!kitchen!and!studio!space.!!

BLACKWALL'PROPERTY'FUNDS'LIMITED !(ASX!Code:!BWF)!ABN!37!146!935!131! Level!1,!50!Yeo!Street,!Neutral!Bay,!Sydney!NSW!2089!Australia | PO!Box!612,!Neutral!Bay,!Sydney! NSW!2089!Australia | Tel!+61!2!9033!8611 | Fax!+61!2!9033!8600 | www.blackwallfunds.com.au

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Transactions$and$Balance$Sheet$$

Transaction! Fees! are! earned! by! structuring! and! underwriting! investment! funds! and! through! performance!fees.!Where!performance!fees!are!earned!they!can!be!substantial.!!

2015	2015	2014	2013	2012	2011
TransactionFees	$250,000	$3,894,000	$217,000	$180,000	$595,000

Our! debt! free! balance! sheet! is! invested! in! our! funds,! underwrites! new! investment! offers! and! secures!deep!value!or!turnaround!opportunities.!

From!time!to!time!we!recycle!our!capital!by!trading,!redeeming!or!selling!investments!for!cash!or! other!positions.!Mature!holdings!can!also!be!distributed!to!shareholders!by!in^specie!distributions.! Our!current!holdings!are:!

BlackWallPropertyTrust	7,500,000units	$9,375,000
BakehouseBonds	5,000,000bonds	$5,430,000
PelathonPubGroup	18,811,439units	$1,354,000

New$Fund$

We!have!launched!a!new!investment!offer!known!as!the!Woods!PIPES!Fund.!Investors!are!offered! the!opportunity!to!invest!in!the!Woods!Action!Centre!in!Sydney.!The!structure!is!forecast!to!pay! quarterly!income!distributions!of!8%!per!annum!with!a!share!of!growth!in!the!value!of!the!property! over!the!seven^year!term.!

This! offer! utilises! the! PIPES! (Property! Income! and! Participating! Equity! Securities)! investment! structure.! PIPES! was! developed! by! our! funds! management! business! in! 2001! and! offers! retail! investors!participation!in!income!producing!real!estate!with!some!capital!protection!and!an!interest! in!improvement!in!the!underlying!property!value.!!For!property!owners!the!PIPES!structure!allows! them!to!extract!capital!from!mature!income!producing!property!while!maintaining!a!partial!interest! in!any!growth.!!

Bakehouse$Bonds$

We!hold!$5.4!million!of!Bakehouse!Bonds.!The!bonds!are!subordinated!debt!notes!secured!against!a! large!mixed^use!development!known!as!the!Bakehouse!Quarter.!!

During!the!2015!financial!year!the!Bakehouse!Quarter!was!formally!marketed!for!sale!as!a!result!of! a!number!of!unsolicited!approaches!to!purchase.!Through!the!marketing!process!an!offer!of!$270! million! was! received! but! was! rejected! by! the! Directors.! Subsequently! an! offer! (from! a! different! party)!of!$300!million!was!declined!as!it!was!subject!to!unacceptable!conditions.!!

The! Bakehouse! Quarter! has! $108! million! of! bank! debt,! which! ranks! in! priority! to! $27.1! million! worth!of!Bakehouse!Bonds!($21.7!million!held!by!BWR!and!$5.4!million!held!by!us).!With!total!debt! of! $135! million! and! depending! on! the! value! of! the! property! adopted,! Bakehouse! Bonds! are! protected!by!an!equity!buffer!of!between!$134!million!and!$165!million.!!

While! the! site! is! no! longer! being! actively! marketed! for! sale! there! are! a! number! of! parties! conducting!due!diligence!and!revised!offers!will!be!assessed!if!received.!If!the!Bakehouse!were!to!be! sold!in!one!line!the!Bakehouse!Bonds!would!be!redeemed!for!cash.!!!

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To!further!progress!the!development,!we!have!resolved!to!make!an!application!for!a!rezoning!of!the! site!and!either:!

sell!the!individual!residential!development!sites;!or!
joint!venture!a!residential!development.!

A! joint! venture! may! involve! us! structuring! a! residential! investment! syndicate! with! the! property! owner!and!a!residential!development!partner.!A!partial!sale!or!residential!development!could!result! in!the!bonds!being!redeemed!in!part!or!in!full!for!cash.!

For!more!information!contact!Stuart!Brown!(Chief!Executive!Officer)!or!Tim!Brown!(Chief!Financial! Officer)!on!+612!9033!8611.

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Appendix!4E! Financial!Year!Ended!30!June!2015!

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BlackWall!Property!Funds!Limited! ABN!37!146!935!131!

This! Appendix! 4E! should! be! read! in! conjunction! with! the! consolidated! annual! financial! report! of! BlackWall! Property!Funds!Limited!for!the!year!ended!30!June!2015!(previous!corresponding!period:!year!ended!30!June! 2014).!


Resultsforannouncementtothemarket	2015 $’000 2014 $’000 Movement Up/(Down)
Revenuefromordinaryoperations Recurringincome 6,092 5,125 18.87% Transactionfees 250 3,894 (93.58%) Assetsalesandrevaluations 2,685 1,833 46.48% Totalrevenuefromordinaryoperations 9,027 10,852 (16.82%) Profitfromordinaryoperationsaftertaxattributableto membersofthecompany 2,823 4,081 (30.83%) Netprofitaftertaxattributabletomembersofthecompany 2,823 4,081 (30.83%)	6,092 5,125 18.87% 250 3,894 (93.58%) 2,685 1,833 46.48%
Dividends(Fullyfranked) 2015 cps 2014 cps
Interimdividends 1.3 1.2 Finaldividendsdeclared 1.7 1.3 Recorddate:16October2015 3.0 2.5 Paymentdate:6November2015
2015 2014
NTApershare 34cents 29cents

This!report!should!be!read!in!conjunction!with!the!attached!financial!statements,!which!have!been!audited!by!ESV! Accounting!and!Business!Advisors.!

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Stuart!Brown! Director! Sydney,!19!August!2015

BLACKWALL!PROPERTY!FUNDS!LIMITED !(ASX!Code:!BWF)!ABN!37!146!935!131! Level!1,!50!Yeo!Street,!Neutral!Bay,!Sydney!NSW!2089!Australia | PO!Box!612,!Neutral!Bay,!Sydney! NSW!2089!Australia | Tel!+61!2!9033!8611 | Fax!+61!2!9033!8600 | www.blackwallfunds.com.au

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& Controlled Entities ABN 37 146 935 131

Consolidated Annual Financial Report Year Ended 30 June 2015

CONTENTS

Financial Report

Directors’ Report	Page 3
Auditor’s Independence Declaration	Page 11
ASX Additional Information	Page 12
Group Details	Page 14
Consolidated Statement of Profit or Loss and Other
Comprehensive Income	Page 15
Consolidated Statement of Financial Position	Page 16
Consolidated Statement of Changes in Equity	Page 17
Consolidated Statement of Cash Flows	Page 18
Notes to the Financial Statements	Page 19
Directors’ Declaration	Page 41
Independent Auditor’s Report	Page 42
Contents – Notes to the Financial Statements	Page 44
Glossary	Page 45

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

Principal Activities and Review of Operations

�lac��all is a vertically integrated property �usiness� For the year ended 3� �une 2�15 �lac��all made an after ta� profit of �2�8 million� �he Directors have declared a final fully fran�ed dividend of 1�7 cents per share to �e paid on 6 Novem�er 2�15� �his �rings the full�year dividend to 3 cents per share fully fran�ed� up 2�� on the 2�14 full year dividend�

�lac��all has net tangi�le assets of �16�9 million �34 cents per share� up 17� on the 2�14 N�A� with 5��4 million shares on issue�

�lac��all’s operating revenue is generated through management fees from income producing property and sales from its growing su�sidiary� �O�SO �or�Space� �lac��all’s de�t free �alance sheet is invested in its funds or used to underwrite new investment offers� �lac��all also invests in deep value or turnaround opportunities� �hrough these activities �lac��all aims to generate N�A growth and recurring investment income�

Profit & Loss Summary	2015	2014
Recurring Income
�anagement Fees	�3�917��	�3�524��
�O�SO �or�Space Income	�1�863��	�1�23��
Investment Income	�312��	�371��
Total Recurring Income	$6,092,000	$5,125,000
Other Income
�ransaction Fees	�25��	�3�894��
Asset Sales� Impairment � Revaluations	�2�685��	�1�437��
Total Other Income	$2,935,000	$5,331,000
Total Income	$9,027,000	$10,456,000
E�penses	��4�853��	��4�576��
Depreciation	��16��	��158��
�a�	��1�191��	��1�641��
After Tax Profit	$2,823,000	$4,081,000
Earnings Per Share	$0.06	$0.08
Balance Sheet Summary	2015	2014
Net �angi�le Assets	�16�897��	�14�6�5��
N�A Per Share	��34	��29
Closing Price�	��33	��265

Shares On Issue	5��395�445	5��395�445
�ar�et Cap	�16�63��496	�13�354�792

* Closing price on the day prior to release of results.

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

Management

�lac��all’s ma�or management activities include�

BlackWall Property Trust (BWR)	ASX�listed real estate investment trust� �lac��all holds 7�5
	million ��R units �16��
Pyrmont Bridge Trust	�holesale investment trust invested in a large commercial
	property turnaround pro�ect at 55 Pyrmont �ridge Road�
	Pyrmont�
Bakehouse Quarter/BQT	Large scale mi�ed use property development owned �y a
	wholesale investment trust �nown as the �irela Development
	�nit �rust� �lac��all underta�es fund� asset and de�t
	management on �ehalf of �irela� In addition �lac��all acts as
	the responsi�le entity for a retail investment trust ��nown as
	�a�ehouse �uarter �rust or �� which holds a significant
	investment in �irela� ��R and the Pyrmont �ridge �rust� ��R
	and �lac��all each hold su�ordinated de�t interests secured
	over the �a�ehouse �uarter�
BlackWall Telstra House Trust	Retail investment trust holding a large�scale commercial
	property located at 49� North�ourne Avenue Can�erra�
BlackWall Penrith Fund No.3	12� �ulgoa Road� Penrith is a �ig �o� retail centre� �lac��all
	has arranged a series of PIPES investment structures over the
	asset� the latest of which matures in 2�2��
WRV Unit Trust/Woods PIPES Fund	�R� is a single asset wholesale investment trust controlling an
	entertainment asset �nown as the �oods Action Centre�
	�lac��all has recently launched a 7�year PIPES investment
	structure� which is e�pected to close on 3� Septem�er�
Bald Rock Fund	A wholesale investment trust with an interest in a pu� located
	in Ro�elle Sydney� Contracts with respect to the sale of the pu�
	have e�changed and the fund will wind up soon� Investors will
	have earned an IRR of almost 4�� p�a�

The Bakehouse Quarter

�he pro�ect comprises over 4�� sqm of commercial� retail and entertainment space leased to tenants including Arnott’s� NR�A� Aldi� Fitness First and A�F �owling�

During the 2�15 financial year the �a�ehouse �uarter was formally mar�eted for sale as a result of a num�er of unsolicited approaches to purchase� �hrough the mar�eting process an offer of �27� million was received �ut was re�ected �y the Directors� Su�sequently an offer �from a different party� of �3�� million was declined as it was su��ect to unaccepta�le conditions�

�hile the site is no longer �eing actively mar�eted for sale there are a num�er of parties conducting due diligence and revised offers will �e assessed if received� �o further progress the development� �lac��all has resolved to ma�e an application for a re�oning of the site and either�

sell the individual residential development sites� or

4 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

�oint venture a residential development�

A �oint venture may involve �lac��all structuring a residential investment syndicate with the property owner and a residential development partner�

In addition to the management activities underta�en �y �lac��all at the �a�ehouse �uarter� the Company holds 5 million �a�ehouse �onds with a carrying value of �5�4 million� �a�ehouse �onds are su�ordinated de�t securities with a coupon of 5�5� per annum� �he �a�ehouse �onds mature in 2�2� and their face value is inde�ed to CPI annually� ��R also holds 2� million �a�ehouse �onds� �he �onds are su�ordinated to senior de�t secured on the pro�ect� If the �a�ehouse were to �e sold in one line the �a�ehouse �onds would �e redeemed for cash� Similarly� a partial sale or residential development could result in the �onds �eing redeemed in part or in full for cash�

�he �a�ehouse �uarter has �1�8 million of �an� de�t� which ran�s in priority to �27�1 million worth of �a�ehouse �onds ��21�7 million held �y ��R and �5�4 million held �y �lac��all�� ith total de�t of �135 million� depending on the value of the property adopted� �a�ehouse �onds are protected �y an equity �uffer of �etween �134 million and �165 million�

BlackWall Property Trust

�he �lac��all Property �rust is an ASX�listed real estate investment trust with commercial� retail and industrial property interests� �he �rust has �12� million of gross assets with �5� million of �an� de�t giving rise to net tangi�le assets of �64 million or �1�4� per unit� �he �rust has 46 million units on issue�

�lac��all aims to grow ��R’s gross assets through property acquisition and development or mergers at the trust level� As mentioned a�ove ��R hold �21�7 million �a�ehouse �onds�

�he �rust has declared a final distri�ution of 6 cents per unit on 6 Novem�er 2�15� �his �rings the full year distri�ution to 11�5 cents per unit �an interim distri�ution of 5�5 cents per unit was paid in April 2�15�� he �rust has carried forward revenue losses of over �2� million and capital losses of appro�imately �17 million� As a consequence for a significant period all distri�utions will �e 1�� ta� deferred� Please refer to the ��R full year accounts released to the mar�et on 17 August 2�15 for more information�

Woods PIPES Fund

�lac��all has launched a new investment fund �nown as the �oods PIPES Fund� Investors are offered the opportunity to invest in the �oods Action Centre in Sydney� �he structure is forecast to generate quarterly income distri�utions of 8� per annum with a share of growth in the value of the property over the seven�year term�

�his offer utilises the PIPES �Property Income and Participating Equity Securities� investment structure� PIPES was developed �y �lac��all’s funds management �usiness in 2��1 and offers retail investors participation in income producing real estate with some capital protection and an interest in improvement in the underlying property value� For property owners the PIPES structure allows them to e�tract capital from mature income producing property while maintaining a partial interest in any growth�

WOTSO WorkSpace

�O�SO provides short�term serviced office and wor�space accommodation at locations in Sydney �Neutral �ay� Pyrmont and North Strathfield�� the Gold Coast and the AC�� See www�wotsowor�space�com�au�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

�O�SO �or�Space is �ecoming an integral part of �lac��all’s activities and adds value on a num�er of levels� Specifically�

E�I�DA contri�ution of �5�� in 2�15�
at suita�le properties �O�SO is a ready tenant in �lac��all’s pro�ects� �y way of e�ample� �O�SO has leased �ust over 9�� sqm at �lac��all�s Pyrmont �ridge Road property� �his is generating �45�� per annum of rent from space that was otherwise untenanted and �O�SO is already ma�ing a margin over its rental cost� and
periodically �O�SO’s customers grow from serviced office users to conventional tenants on long� term leases in �lac��all’s pro�ects�

�O�SO’s financial contri�ution is e�pected to grow significantly� In the year ended �une 2�15 gross revenue was �1�9 million� Current annualised revenue is appro�imately �3 million� At new sites sustaina�le occupancy is generally �uilt over a two to three year period� Of its 5�5�� sqm footprint roughly 4�� has �een in operation for less than 12 months� �he �usiness is also e�panding its offer �y launching specialist premises �y developing la�oratory� commercial �itchen and studio space�

Share Buy�Back

�he Company has e�tended its share �uy��ac� to e�pire on 15 �arch 2�16� No shares have �een acquired since 3� �une 2�14�

Significant Changes in Affairs

�here were no significant changes to the state of affairs of the Group during the financial year�

Events Subsequent to Reporting Date and Likely Developments

�o the �est of the Directors’ �nowledge� since the end of the financial year there have �een no matters or circumstances that have materially affected the Group’s operations or may materially affect its operations� state of affairs or the results of operations in future financial years�

Information on Officeholders

�he names of the Officeholders during or since the end of the year are set out �elow� �nless otherwise stated� Officeholders have �een in office since 2� Octo�er 2�1��

Name and Position	Special Experience
Richard �ill	Richard �ill has e�tensive investment �an�ing e�perience and was the
Non�E�ecutive Director and	founding partner of the corporate advisory firm �ill �oung � Associates�
Chairman	Richard has invested in the Group’s pro�ects since the early 199�s� Prior
	to forming �ill �oung� Richard held a num�er of Senior E�ecutive
	positions in �ong �ong and New �or� with �S�C� �e was admitted as
	an attorney in New �or� State and was registered �y the �S Securities �
	E�change Commission and the Ontario Securities Commission� �e is the
	Chairman of Sirte� �edical Limited listed on the ASX� In addition
	Richard is Chairman of the �estmead �illennium Institute for �edical
	Research�

6 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

�oseph �Seph� Glew Seph has wor�ed in the commercial property industry in New �ealand� Non�E�ecutive Director the �SA and Australia� Seph has driven large scale property development and financial structuring for real estate for over 3� years� In addition� since the early 199�s Seph has run many �turn�around� processes in relation to distressed properties and property structures for �oth private and institutional property owners� �hile wor�ing for the �ousing Corporation of New �ealand and then A�P� Seph qualified as a registered valuer and holds a �achelor of Commerce� In the 198�s he served as an E�ecutive Director with New �ealand �ased property group Chase Corporation and as a Non� E�ecutive Director with a num�er of other listed companies in New �ealand and Australia�

Ro�in �edder Ro�in has around 4� years’ e�perience in investment and financial Non�E�ecutive Director mar�ets� �e has �een an investor in �lac��all’s pro�ects since 1997� Ro�in is the Chairman of �intage Capital Pty Ltd� an investment company with interests in property� wealth management� logistics and healthcare� �e is a former mem�er of the ASX and has served on the �oards of several investment �an�s in Australia and overseas� �e is a Director of Pro�iotec Ltd �a pharmaceutical manufacturing company listed on the ASX�� Ro�in is also a Fellow of the Financial Services Institute of Australasia� Stuart �rown Stuart has �een involved in property investment for over 17 years� E�ecutive Director and Chief Stuart has run de�t and equity raising in relation to listed and unlisted E�ecutive Officer real estate structures with over a half a �illion dollars in value� In his earlier career� Stuart practised as a solicitor in the areas of real estate� mergers and acquisitions and corporate advisory with �allesons and Gil�ert � �o�in� Stuart is also an independent Director of Coogee �oys’ Preparatory School� Caroline Raw Caroline Raw �oined the �lac��all team in 2�13� Caroline has �een Company Secretary from 18 practising as a solicitor in NS� since 2��5 and has wor�ed Fe�ruary 2�15 predominantly on IPOs� pu�lic and private capital raisings� funds management� corporate advisory� ta�eovers and mergers and �Don �ayly acquisitions� Caroline holds a �achelor of Commerce� �achelor of Laws Company Secretary until 18 and Graduate Diploma in Applied Corporate Governance� Caroline is Fe�ruary 2�15� also a Chartered Secretary and Associate �em�er of the Governance Institute of Australia�

Meeting Attendances

Director	No. of Board	Board Meeting
	Meetings Held	Attendance
Richard �ill	1�	1�
SephGlew	1�	1�
Ro�in �edder	1�	1�
Stuart�rown	1�	1�

�he Audit Committee� comprised of Seph Glew and Ro�in �edder� met twice during the reporting period� �oth committee mem�ers attended each meeting�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

Environmental Regulation

�he Group’s operations are not regulated �y any environmental regulation under a law of the Commonwealth or of a State or a �erritory other than those that pertain to the ownership and development of real estate�

Indemnities of Officers

During the financial year the Group has paid premiums to insure each of the Directors named in this report along with Officers of the Group against all lia�ilities for costs and e�penses incurred �y them in defending any legal proceedings arising out of their conduct while acting in the capacity of Director or Officer of the Group� other than conduct involving a wilful �reach of duty�

No indemnities have �een given or insurance premiums paid� during or since the end of the financial year� for any person who is or has �een an auditor to the Group�

Corporate Governance Statement

A description of the Group’s current corporate governance practices is set out in the Group’s corporate governance statement which can �e viewed at http��www��lac�wallfunds�com�au�a�out�us�html�

Auditor and Non�audit Services

�11�45� was paid to the auditor for non�audit services during the year �2�14� �1��25�� as detailed in the Auditor’s Remuneration note of the financial statements� �he Directors are satisfied that the provision of non�audit services is compati�le with the general standard of independence for auditors imposed �y the Corporations Act 2��1� �he nature and scope of each type of non�audit service provided means that auditor independence was not compromised�

On 5 �une 2�15� the �oard approved the e�tension of the Audit Partner rotation period from five years to seven years in accordance with section 324DA� of the Corporations Act 2��1� �he reasons for the e�tension included the �oard’s �elief that� the Company would �enefit from the continuity of �nowledge and e�perience that �r �ir�wood had gained in relation to the Company’s operations and state of affairs in the preceding five years� the integrity and quality of the audit wor� would �e maintained� and a rotation at this point would increase the administrative �urden to the Company� �he Company has the right to reassess �r �ir�wood’s appointment at any time during the e�tended period�

A copy of the auditor’s independence declaration as required under Section 3�7C of the Corporations Act 2��1 is set out in these financial statements�

ES� continues in office in accordance with section 327 of the Corporations Act 2��1�

Rounding of Amounts

�he Group is a group of the �ind referred to in ASIC Class Order 98�1�� and in accordance with that Class Order� amounts in the Directors’ Report and the financial statements are rounded off to the nearest thousand dollars� unless otherwise indicated�

Remuneration Report (Audited)

�he �oard is responsi�le for determining the remuneration of ��P� For the reporting period the �oard has determined that ��P included the Chief E�ecutive Officer and the Chief Financial Officer� ��P determine the senior e�ecutive and employees’ remuneration�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

�hen determining the remuneration of ��P� senior e�ecutives or employees� the following is ta�en into consideration�

remuneration is aligned with the delivery of returns to shareholders�
responsi�ilities� results� innovation and entrepreneurial �ehaviour are recognised and rewarded� and
the Group’s financial position and mar�et conditions�

�he remuneration paya�le to ��P is reviewed at time deemed appropriate �y the �oard� �here are no performance conditions for �oard mem�ers or contracts for ��P� Any performance payments are at the discretion of the �oard� �he nature and the amount of each element of remuneration paid to the �oard mem�ers and ��P for the reporting period are listed �elow�

	Short term Directors’ fees Salary and other Post�employment superannuation Total 2015 2014 2015 2014 2015 2014 2015 2014 $ $ $ $ $ $ $ $
Richard �ill	85�� 85�� � � � � 85�� 85��
SephGlew	75�� 75�� � � � � 75�� 75��
Ro�in �edder	75�� 75�� � � � � 75�� 75��
Stuart�rown	� � 321�4�5 325�6�2 3��2�1 25�2�1 351�6�6 35��8�3
�im �rown	� � 199�312 2��76� 18�935 15�24� 218�247 216��
Total	235,000 235,000 520,717 526,362 49,136 40,441 804,853 801,803

Share options

�he following options are currently on issue� �he e�ercise prices for A Options and � Options are 25 cents and 35 cents respectively�

	Expiry date	Number of options granted
Richard�ill	3� �une2�16	25��AOptions
SephGlew	3� �une2�16	2��AOptions
Ro�in �edder	3� �une2�16	2��AOptions
Stuart �rown	3� �une 2�16 3� �une 2�18	9�� A Options 2�� Options
�im �rown	3� �une2�16	395��AOptions
Total		1,945,000 A Options 2,000,000 BOptions

Directors and KMPs’ Relevant Interests

Details of each ��P’s relevant interests in the Company and at the release of the 2�15 Annual Report are shown �elow�

	30 June 2014	Net change	*14 August 2015 **
Richard�ill	1�643�686	24��	1�667�686
Seph Glew	7�753�51�	1�5��	9�253�51�
Ro�in �edder	7�442�5�2	1��	8�442�5�2
Stuart�rown	7��23�	1�5��	2�2��23�
�im �rown	83�141	45��	533�141
Total	17,623,069	4,474,000	22,097,069

* Same holdings as at 30 June 2015

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ REPORT

Signed in accordance with a resolution of the �oard of Directors�

==> picture [107 x 52] intentionally omitted <==

Stuart Brown Director Sydney� 19 August 2�15

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

==> picture [187 x 138] intentionally omitted <==

Auditor’s Independence Declaration Under Section 307C of the Corporations Act 2001

As auditor for the audit of Blackwall Property Funds Ltd and its Controlled Entities for the year ended 30 June 2015, I declare that, to the best of my knowledge and belief, there have been:

(i) no contraventions of the auditor’s independence requirements as set out in the Corporations Act 2001 relation to the audit; and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.

Dated at Sydney the 17[th] day of August 2015.

==> picture [43 x 26] intentionally omitted <==

ESV Accounting and Business Advisors

==> picture [107 x 34] intentionally omitted <==

Chris Kirkwood Partner

==> picture [595 x 82] intentionally omitted <==

ASX ADDITIONAL INFORMATION

Additional information required �y the Australian Securities E�change and not shown elsewhere in this report is as follows� �he shareholder information set out �elow was current as at 14 August 2�15�

1. Shareholders

�he Company’s top 2� largest shareholdings were�

	Investor	Ordinary Shares (No.)	Shares (%)
1	�intage Capital Pty Limited	5�413�8��	1��74
2	Seno �anagement Pty Ltd �Seno Super Fund A�C�	5�1��	1��12
3	Lym�eesh Pty Ltd �Employees Super Fund A�C�	4�3�4�742	8�54
4	Sandhurst �rustees Ltd �AI�S PSF A�C�	2�762��	5�48
5	Ihop Pty Ltd ��eppel Investments �nit A�C�	2�657�2�5	5�27
6	�oonta Pty Ltd ��oonta Super Fund Account�	1�998�7�2	3�97
7	�agar Property Consultants Pty Limited	1�464�581	2�91
8	Sao Investments Pty Ltd	1�428�262	2�83
9	� P �organ Nominees Australia Limited	1�2�3�928	2�39
1�	�c�ullin Nominees Pty Ltd	1�148�713	2�28
11	Pinnatus Pty Ltd	1�141��88	2�26
12	Frogstorm Pty Ltd ��he Roc�ahula A�C�	1��3��223	2��4
13	�in24 �usiness Advisors Pty Limited	1��2��	2��2
14	�r Richard �ill �Richard �ill Super Fund A�C�	873�6�4	1�73
15	�ethuselah Capital �anagement Pty Ltd	8�5�412	1�6�
16	Glenahilty Limited	772��88	1�53
17	I P R Nominees Pty Ltd �1965 Irvin Peter Roc�man A�C�	755�781	1�5�
18	�ampopo Pty Ltd	754��82	1�5�
19	�r �ar� �amish Lochten�erg � �r �ichael Lochten�erg	5�1�371	��99
2�	Plan Sailing �rails Pty Ltd �PS� A�C�	457�838	��91

12 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

ASX ADDITIONAL INFORMATION

2. Distribution of Shareholders

�he distri�ution of shareholders �y si�e of holding was�

Category	No. of Shareholders
1�1��	242
1��1�5��	541
5��1�1��	2�3
1��1�1��	2�4
1��1and over	47
Total number of shareholders	1,237

�lac��all has 369 holders of less than a mar�eta�le parcel� �he Company has 5��395�445 ordinary shares on issue� All shares carry one vote per share without restrictions� All shares are quoted on the Australian Securities E�change �ASX� ��F��

3. Substantial Shareholders

�he Company’s su�stantial shareholders are set out �elow�

Investor	Ordinary Shares (No.)	Shares (%)
�R �Seph� Glew	9�253�51�	18�36
Ro�in �edder	8�442�5�2	16�75
Paul �residder	7�442�252	14�77
I�OP Pty Limited ��eppel Investments �nit �rust�	3�948�526	7�83
Sandhurst �rustees Ltd �AI�S PSF A�C�	2�762��	5�48

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

GROUP DETAILS

�he Group’s details are as follows�

Registered Office	Level 1� 5� �eo Street Neutral �ay NS� 2�89
Principal Place of �usiness	Level 1� 5� �eo Street Neutral �ay NS� 2�89
�elephone	�612 9�33 8611
Fa�	�612 9�33 86��
�e�sites	www��lac�wallfunds�com�au www�wotsowor�space�com�au
Registry	Computershare Investor Services Pty Limited GPO �o� 2975 �el�ourne �IC 3��1 www�computershare�com�au �elephone� �613 9415 4329

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the Year Ended 30 June 2015

Note �anagement fees �O�SO �or�Space income Investment income Recurring Revenue �nrealised gain on revaluation of financial assets �ransaction fees Total Revenue 2 �usiness operating e�penses 3 Depreciation Finance costs Other e�penses Loss on disposal of assets �rite off of goodwill Profit Before Income Tax Income ta� e�pense 4 Profit For the Year Total Comprehensive Income For the Year Profit / (Loss) Attributable To: Owners of the Group Outside equity interest Total Comprehensive Income / (Loss) Attributable To: Owners of the Group Outside equity interest Earnings Per Share Continuing operations� �asic and diluted earnings per share 17	2015 $’000 2014 $’000 3�917 3�524 1�863 1�23� 312 371
	6,092 5,125 2�685 1�833 25� 3�894
	9,027 10,852 �4�827� �4�566� �16�� �158� �19� �33� �1�� �7� � �48� � �348�
	4,011 5,692 �1�191� �1�641�
	2,820 4,051
	2,820 4,051
	2�823 4��81 �3� �3��
	2,820 4,051
	2�823 4��81 �3� �3��
	2,820 4,051
	��6 ��8

�he accompanying notes form part of these �inancial statements�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Consolidated Statement of Financial Position

As at 30 June 2015

Note ASSETS Current Assets Cash and cash equivalents 5 �rade and other receiva�les 6 Total Current Assets Non�current Assets Equity accounted investments 7 Financial assets 8 Property� plant and equipment 9 Total Non�current Assets TOTAL ASSETS LIABILITIES Current Liabilities �rade and other paya�les 1� Current ta� paya�le 11 Provisions 12 Total Current Liabilities Non�current Liabilities Other paya�les 13 Deferred ta� lia�ilities 14 Provisions 12 Total Non�current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Share capital 15�a� Reserves 15�c� Retained earnings Parent Interest Outside equity interest TOTAL EQUITY	2015 $’000 2014 $’000 483 1�123 629 952
	1�112 2��75
	5 5 16��24 14�255 831 387
	16�86� 14�647
	17,972 16,722
	632 87� � 925 248 2�8
	88� 2��3
	164 119 1�388 6�9 94 55
	1�646 783
	2,526 2,786
	15,446 13,936
	11�247 11�247 8 8 4�254 2�741
	15�5�9 13�996 �63� �6��
	15,446 13,936

==> picture [60 x 43] intentionally omitted <==

16 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Consolidated Statement of Changes in Equity

For the Year Ended 30 June 2015

Ordinary shares $’000 11,247 � �	Retained earnings/ (accumulated losses) $’000 2,741 2�823 �1�31��	Share options reserve $’000 8 � �	Attributable to owners of the parent $’000 13,996 2�823 �1�31��	Outside equity interest $’000 (60) �3� �	Total $’000 13,936 2�82� �1�31��
11,247	4,254	8	15,509	(63)	15,446
11,338 � � � �91� �	(433) 4��81 �9�7� � � �	� � � � � 8	10,905 4��81 �9�7� � �91� 8	146 �3�� � �176� � �	11,051 4��51 �9�7� �176� �91� 8
11,247	2,741	8	13,996	(60)	13,936

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Consolidated Statement of Cash Flows

For the Year Ended 30 June 2015

Note Cash Flows From Operating Activities �anagement fee receipts �O�SO �or�Space receipts �ransaction fee receipts Investment income Payments to suppliers and employees Income ta� paid �an� charges and interests paid Net Cash Flows From Operating Activities 2� Cash Flows From Investing Activities Returns of capital from ��R Receipts from sale of other related funds units Net proceeds from ��repayment of� loan to �ald Roc� Fund Payments for �O�SO �or�Space fitout Payments for Pelathon Pu� Group Preferred units Net payments for ��R units Payments for fi�ed assets Net Cash Flows Used in Investing Activities Cash Flows From Financing Activities Dividend paid Repayment of �orrowings Payments for share �uy��ac� Net Cash Flows Used in Financing Activities Net Increase / (Decrease) in Cash Held Cash and cash equivalents at the �eginning of the year Cash and Cash Equivalents at End of the Year 5	2015 $’000 2014 $’000 5�296 4�85� 2��18 1�355 25� 3�894 312 3�3 �5�792� �5�993� �1�277� �496� �19� �33�
	788 3,880
	672 185 174 19� 15 �475� �572� �35� �225� �15�� �166� �2�12�� �32� �9�
	(134) (2,414)
	�1�294� �1��79� � �25�� � �91�
	(1,294) (1,420)
	(640) 46 1�123 1��77
	483 1,123

18 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

1. Segment Information

�he segment information for the year ended 3� �une is as follows� For information on segment reporting� refer to Notes to the Financial Statements for more details�

Profit & Loss 2015 ($’000) Income Gains Total Revenue	Expenses EBTDA Pre�tax Profit
�anagement 4��42 � 4��42 �O�SO �or�Space 1�972 � 1�972 Investment 328 2�685 3��13 �nallocated � � �	�2�841� 1�2�1 1�187 �1�446� 526 38� �458� 2�555 2�555 �111� �111� �111�
Consolidated 6,342 2,685 9,027	(4,856) 4�171 4,011

Profit & Loss 2014 ($’000) Income Gains Total Revenue	Expenses EBTDA Pre�tax Profit
�anagement 7�417 � 7�417 �O�SO �or�Space 1�23� � 1�23� Investment 372 1�833 2�2�5 �nallocated � � �	�3��33� 4�384 4�365 �971� 259 12� �465� 1�74� 1�74� �533�� �533� �533�
Consolidated 9,019 1,833 10,852	(5,002) 5�85� 5,692
* includes $348,000 write off of goodwill
June 2015	June 2014
Balance Sheet ($’000) Assets Liabilities Net Assets	Assets Liabilities Net Assets
�anagement 1�134 �713� 421 �O�SO �or�Space 814 �316� 498 Investment 16��24 �1�497� 14�527	2��29 �1�8�8� 221 438 �173� 265 14�255 �8�5� 13�45�
Consolidated 17,972 (2,526) 15,446	16,722 (2,786) 13,936
2. Revenue Recurring revenue� �anagement fees �O�SO �or�Space income Investment income � distri�utions Investment income � interest Other revenue� �nrealised gain on revaluation of financial assets �ransaction fees Total	2015 $’000 2014 $’000 3�917 3�524 1�863 1�23� 275 3�9 37 62 6��92 5�125 2�685 1�833 25� 3�894 2�935 5�727 9,027 10,852

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

3.	Expenses
		2015	2014
		$’000	$’000
	Employee � consultants’ costs	2�7�5	2�943
	�O�SO �or�Space e�penses	1�446	971
	Administration e�penses	676	652
	�otal �usiness operating e�penses	4�827	4�566
4.	Income Tax Expense
		2015	2014
		$’000	$’000
	Current ta�	412	1�28�
	Deferred ta�	779	366
	Overprovision of prior year ta�	�	�5�
	Total	1,191	1,641
		2015	2014
		$’000	$’000
	Prima facie ta� paya�le on profit from ordinary activities
	�efore income ta� at 3�� 2�14� 3��	1�2�3	1�7�7
	Add � �less� ta� effect of�
	� Non�deducti�le items	5	135
	� Deducti�le item	�17�	�181�
	� Costs of issuing equity	�	�15�
	� Overprovision of prior year ta�	�	�5�
	Total	1,191	1,641
5.	Current Assets � Cash and Cash Equivalents
		2015	2014
		$’000	$’000
	Cash on hand	1	1
	Cash at �an�	482	1�122
	Total	483	1,123
	Cash at �an� earns interest at floating rates �ased on daily �an� deposit rates�
6.	Current Assets � Trade and Other Receivables
		2015	2014
		$’000	$’000
	�rade receiva�les�
	� Related parties	158	824
	� Other parties	15	25
	�otal trade receiva�les	173	849
	Other receiva�les�
	� �ald Roc� Fund loan receiva�le	45�	�
	� Related parties	1	47
	� Other parties	5	56
	�otal other receiva�les	456	1�3
	Total	629	952

20 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

�he �ald Roc� �otel loan receiva�le was repaid in full in August 2�15� Further information relating to trade and other receiva�les to related parties is set out in the Related Party �ransactions note� None of the receiva�les were impaired as at 3� �une 2�15 �2�14� �nil��

7. Non�current Assets � Equity Accounted Investments

Ownership Interest Name Principal Country of Incorporation 2015 % 2014 % APG Asset �anagement Pty Ltd Financial services and management company Australia 5� 5� Total	Carrying Amount of Investment 2015 $’000 2014 $’000 5 5
	5 5

8. Current and Non�current Assets � Financial Assets

Note (a) Non�current Loan to �ald Roc� Fund Financial assets at F��PL 8�� Total	June 2015 $’000 June 2014 $’000 � 465 16��24 13�79�
	16,024 14,255

�he �ald Roc� Fund loan is now classified as a current receiva�le� Refer to �rade and Other Receiva�les note for further details�

(b) Financial assets at FVTPL �lac��all Property �rust �a�ehouse �onds Pelathon Pu� Group 8�c� Pelathon �anagement Group �lac��all Opportunities Fund Total	9�15� 6�979 5�42� 5�34� 1�354 1��17 1�� 1� � 444
	16,024 13,790

�he �a�ehouse �onds are CPI lin�ed de�t instruments secured against a large scale mi�ed use property �nown as the �a�ehouse �uarter in North Strathfield� Sydney� �he �onds’ face value of �5 million is inde�ed to CPI �su��ect to impairment� and the current value at 3� �une 2�15 is �5�4 million� �he �onds will mature on 3� �une 2�2�� In addition� a coupon of 5�5� per annum is paid quarterly in arrears�

(c) Pelathon Pub Group

�he Group owns the following Pelathon Pu� Group units� �he Preferred units are now fully paid to 6 cents per unit �second instalment of 3�6 cents per unit totaling �225�� was paid in �une 2�15��

12�561�439 Ordinary units 6�25�� Preferred units Total	9�4 829 45� 188
	1,354 1,017

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

9. Non�current Assets � Property, Plant and Equipment Furniture� fi�tures and fittings� � At cost � Less accumulated depreciation Office equipment� � At cost � Less accumulated depreciation Total 30 June 2015 �alance at the �eginning of year Additions Depreciation e�pense �alance at the end of year 30 June 2014 �alance at the �eginning of year Additions Disposals Depreciation e�pense �alance at the end of year 10. Current Liabilities � Trade and Other Payables �rade paya�les� � Related parties � Other parties Sundry paya�les and accrued e�penses Income received in advance� � Related parties � Other parties Total	2015 $’000 2014 $’000 1�488 945 �726� �593�
	762 352 133 1�1 �64� �66�
	69 35
	831 387

	Furniture, fixtures and fittings $’000 Office equipment $’000 Total $’000 352 35 387 551 53 6�4 �141� �19� �16��
	762 69 831
	461 42 5�3 28 17 45 � �3� �3� �137� �21� �158�
	352 35 387
	2015 $’000 2014 $’000 1 47 481 75�
	482 797 41 43 84 � 25 3�
	1�9 3�
	632 870

Further information relating to trade paya�les from related parties is set out in the Related Party �ransactions note�

22 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

11. Current Liabilities � Current Tax Payable Income ta� paya�le Total In 2�15 PA�G instalments paid have equaled ta� paya�le� 12. Current and Non�current Liabilities � Provisions Current – employee �enefits Non�current – employee �enefits Total provisions �alance at the �eginning of year Net additional provisions recognised �alance at the end of year �he num�er of employees for the Group as at 3� �une 2�15 w 13. Non�current Liabilities � Other Payables �enant deposits Total 14. Non�current Liabilities � Deferred Tax Liabilities Deferred ta� lia�ilities � �assets� �alance comprises� Financial assets at F��PL Interest receiva�les Provision for employee �enefits Accrued e�penses Total Movements: �alance at the �eginning of year Charged to the profit and loss Balance at the end of year		2015 $’000 2014 $’000 � 925
		� 925
		2015 $’000 2014 $’000 248 2�8 94 55
		342 263
	as	2015 $’000 2014 $’000 263 22� 79 43
		342 263
		23 �2�14� 19�� 2015 $’000 2014 $’000 164 119
		164 119
		2015 $’000 2014 $’000 1�484 624 21 76 �93� �69� �24� �22�
		1,388 609
		6�9 243 779 366
		1,388 609

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

15. Share Capital and Reserves

(a) Summary table 5��395�445 �2�14� 5��395�445� Ordinary Total (b) Movement in shares on issue At the �eginning of reporting period Shares cancelled during the year At reporting date		2015 $’000 2014 $’000 11�247 11�247
		11,247 11,247
		No. No. 5��395�445 51��2��445 � �625��
		50,395,445 50,395,445

Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the num�er of shares held� At shareholders’ meetings� each ordinary share is entitled to one vote when a poll is called� otherwise each shareholder has one vote on a show of hands� All shares are fully paid and have no par value�

(c) Reserves

) Reserves
Share options reserve Total	2015 $’000 2014 $’000 8 8
	8 8

In 2�14� the Company granted 4�495�� options to ��P and employees as follows� None of the options were e�ercised during the current year�

Options Expiry date Exercise price A Options 3� �une 2�16 ��25 � Options 3� �une 2�18 ��35	Number 2�495�� 2��
	4�495��

16. Dividends

Fully fran�ed dividends paid to mem�ers during the financial year were as follows�

2�14 final dividend of 1�3 cents paid on 31 Octo�er 2�14 �2�13� ��6 cents� 2�15 interim dividend of 1�3 cents paid on 3� April 2�15 �2�14� 1�2 cents� Total	Parent entity 2015 $’000 2014 $’000 655 3�2 655 6�5
	1,310 907

In addition� the �oard has declared a final fully fran�ed dividend of 1�7 cents per share to �e paid on 6 Novem�er 2�15�

Fran�ing credits availa�le for the su�sequent periods �ased on a ta� rate of 3��

�2�14� 3�� 1,110 1,346

24 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

�he a�ove amounts represent the �alance of the fran�ing account as at the end of the reporting period� ad�usted for�
�a� fran�ing credits that will arise from the payment of the amount of the provision for income ta��
�� fran�ing de�its that will arise from the payment of dividends recognised as a lia�ility at the reporting date� and
�c� fran�ing credits that will arise from the receipt of dividends recognised as receiva�les at the reporting date�

17. Earnings Per Share

�asic and diluted EPS
Calculated as follows�
Profit attri�uta�le to the owners of the Group
�eighted average num�er of shares for �asic EPS
�eighted average num�er of shares for diluted EPS
Auditor’s Remuneration
Remuneration of ES� for�
� audit and assurance services
� ta�ation services
Remuneration of non�ES� firm for�
� other assurance services
� ta�ation services
Total

2015
2014
��6
��8
�2�823��
�4��81��
5��395�445
5��412�568
5��885�9��
5��412�568
2015
$’000
2014
$’000
7�
61
11
1�
81
71
4
7
�
2
4
9
85
80

18. Auditor’s Remuneration

19. Commitments

(a)Operating lease commitments

Operating leases relate to tenancy leases with lease terms of �etween 1 and 5 years�

Lease commitments paya�le� � paya�le within 1 year � paya�le within 2 – 5 years Total	2015 $’000 2014 $’000 1�474 1��6� 3�349 1��85
	4,823 2,145

(b) Capital lease commitments

No capital commitments were in e�istence as at 3� �une 2�15 �2�14� Nil��

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

20. Reconciliation of Operating Cash Flows

Profit for the year
Non�cash flows in profit�
Depreciation
Loss � �gain� on disposal of assets
�nrealised gain on revaluation
�rite off of goodwill
Share options e�pense
Changes in assets and lia�ilities�
Decrease in trade and other receiva�les
Increase in deferred ta� lia�ilities
Decrease in trade and other paya�les
Increase � �decrease� in income ta�es paya�le
Increase � �decrease� in provisions
Net cash flows from operating activities

2015
$’000
2014
$’000
2�82�
4��51
16�
158
�5�
48
�2�685�
�1�833�
�
348
�
8
773
414
79�
547
�2�8�
�511�
�925�
788
68
�138�

788
3,880

21. Contingencies

�he Group had no contingent assets or lia�ilities at 3� �une 2�15 �2�14� �nil��

22. Subsequent Events

23. Controlled Entities

Controlled Entities
	Country of
Name	incorporation	Percentage	Owned
		2015	2014
		%	%
Parent entity:
�lac��all Property Funds Limited	Australia	1��	1��
Subsidiaries of parent entity:
�lac��all �anagement Services Pty Ltd	Australia	1��	1��
�lac��all Fund Services Limited	Australia	1��	1��
�O�SO �or�Space Pty Ltd	Australia	1��	1��

24. Related Party Transactions

(a) Related Entities, Associates and Joint Venture Entities, Managed Funds

In these financial statements� related parties are parties as defined �y AASB 124 Related Party Disclosures rather than the definition of related parties under the Corporations Act 2��1 and ASX Listing Rules�

Associates and Joint Venture Entities

Interests held in associates and �oint venture entities �y the Group are set out in the Equity Accounted Investment note to the financial statements�

26 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Managed Funds

�he Group holds investments in a num�er of property funds for which it acts as either manager or responsi�le entity �refer to the Financial Assets note��

Fees and Transactions

�anagement fees are charged to these entities predominantly for property and fund management services� �he management fees are paid under a management agreement and the fees charged are determined with reference to arm�s length commercial rates�

�hese services principally relate to�

investment management� provision of strategic investment advice� asset management and investment portfolio services� and
asset management� provision of property management services� property portfolio advisory services� maintenance and insurances� strategic advice and management supervision services� administration� mar�eting and ris� management services�

�he Group recharges its related entities� associates� �oint venture entities and managed funds� for administration services which include accounting and �oo��eeping fees� corporate secretarial services and those e�penses that are incurred �y mem�ers of the Group on �ehalf of the related entities� associates�

�oint venture entities and managed funds� In addition� the Group pays the following fees to related entities�

rent for use of the Group�s �a�ehouse �uarter� �O�SO �or�Space and Neutral �ay head office� �he rent paid is determined with reference to arm�s length commercial rates� and
consulting fees as they arise�

Other transactions and outstanding �alances with related entities� associates� �oint venture entities and managed funds relate to loans paya�le and receiva�le and distri�utions from managed funds� All transactions with related parties were made on normal commercial terms and conditions and at mar�et rates� and were approved �y the �oard where applica�le� �he following transactions occurred during the financial year and the �alances were outstanding at the year end �etween the Group and its related entities�

ntities�
	2015	2014
	$’000	$’000
Revenue:
� �anagement and transaction fees	3�283	2�974
� Distri�ution�returns of capital from funds	947	496
� Interest income from loan to �ald Roc� Fund	25	13
Expenses:
� Rent and outgoings paid	1�1�3	1��59
� Consulting fees	�	1
Outstanding balances:
� �rade and other receiva�les � current	6�9	871
� Loan to �ald Roc� Fund � non�current	�	465
� �rade and other paya�les � current	85	47

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

(b) Interests in Related Parties

As at year end the Group owned units in the following related funds�

Entity Holdings (No.’000) 2015 2014 �lac��all Property �rust � 7�5�� 7��48 Pelathon Pu� Group �Ordinary� 12�561 12�561 Pelathon Pu� Group �Preferred� 6�25� 6�25� �a�ehouse �onds 5�� 5�� �lac��all Opportunities Fund � 1�932 �lac��all Storage Fund � �	Distribution/Returns of Capital/Interest ($’000) 2015 2014 672 185 � � � � 275 275 � � � 36
	947 496

2�14 holdings were restated �ased on a 1� to 1 unit consolidation �y �lac��all Property �rust in �arch 2�15�

(c) Key management personnel compensation

Key management personnel compensation
	2015	2014
	$’000	$’000
�otal remuneration paid	8�5	8�2

Detailed remuneration disclosures and relevant interests are provided in the Directors’ Report�

25. Parent Entity Information

�he following summarises the financial information of the Group’s parent entity� �lac��all Property Funds Limited� as at and for the year ended 3� �une�

Results: Profit after ta� Total comprehensive income after tax Financial position: Current assets Non�current assets Total assets Current lia�ilities Non�current lia�ilities Total liabilities Net assets Share capital Reserves Accumulated losses Total equity	2015 $’000 2014 $’000 1�368 2�844
	1,368 2,844
	451 364 13�393 12�168
	13,844 12,532 �2��36� �1�15�� �862� �494�
	(2,898) (1,644)
	10,946 10,888
	11�247 11�247 8 8 �3�9� �367�
	10,946 10,888

�he parent entity had no contingencies or capital commitments at 3� �une 2�15 �2�14� Nil��

28 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

26. Financial Risk Management

(a) Financial risk management

�he main ris�s the Group e�posed to through its financial instruments are mar�et ris� �including foreign e�change ris�� interest rate ris� and price ris�� credit ris� and liquidity ris�� he Group�s principal financial instruments are cash and financial assets� Additionally� the Group has various other financial instruments such as trade de�tors and trade creditors� which arise directly from its operations�

�his note presents information a�out the Group�s e�posure to each of the a�ove ris�s� their o��ectives� policies and processes for measuring and managing ris�� and the management of capital� �he �oard has overall responsi�ility for the esta�lishment and oversight of the ris� management framewor�� It monitors the Group’s ris� e�posure �y regularly reviewing finance and property mar�ets� �he Group holds the following ma�or financial instruments�

holds the following ma�or financial instruments�
	2015	2014
	$’000	$’000
Financial assets
Cash and cash equivalents	483	1�123
Financial assets at F��PL	16��24	13�79�

(b) Market risk

(i) Foreign exchange risk

�he Group has no material foreign e�change ris��

(ii) Interest rate risk

�he impact from movement in interest rates is not material �ased on the current cash �alance� �he ma�or financial asset is the Group’s �5 million interest in �a�ehouse �onds which is su��ect to a fi�ed coupon rate of 5�5� p�a� and as a result is not directly e�posed to the interest rate ris�� owever the �onds’ value is lin�ed to inflation and therefore affected �y the inflation rate�

(iii) Price risk

�he Group is not e�posed to any ma�or price ris� e�cept for a material change in the property valuation of the �a�ehouse �uarter� which could potentially lead to a decrease in the �a�ehouse �onds’ value on their maturity� In relation to the investment in ��R units� a 1�� decrease in the ASX trading price �from the price at 3� �une 2�15� i�e� �1�22 per unit� would result in an unrealised loss after ta� of �641��

(c) Credit risk

�he Group is not e�posed to any ma�or credit ris� e�cept for the �a�ehouse �onds� �he credit ris� for the �a�ehouse �onds is of the same nature as the price ris� descri�ed a�ove�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

(d) Liquidity risk

At 30 June 2015 Financial assets Cash and cash equivalents �rade and other receiva�les Financial assets at F��PL Financial liabilities �rade and other paya�les At 30 June 2014 Financial assets Cash and cash equivalents �rade and other receiva�les Loan to related parties Financial assets at F��PL Financial liabilities �rade and other paya�les	Maturing within 1 year $’000 Maturing 1 – 5 years $’000 Maturing over 5 years $’000 Total $’000 483 � � 483 629 � � 629 � 16��24 � 16��24
	1,112 16,024 � 17,136 632 � � 632 1�123 � � 1�123 952 � � 952 � 465 � 465 � 8�45� 5�34� 13�79�
	2,075 8,915 5,340 16,330 87� � � 87�

(e) Fair value measurements

(i) Fair value hierarchy

AASB 13 Fair Value Measurement requires disclosure of fair value measurements �y level of the following fair value measurement hierarchy�

Level 1 � quoted prices �unad�usted� in active mar�ets for identical assets or lia�ilities�
Level 2 � inputs other than quoted prices included within Level 1 that are o�serva�le for the asset or lia�ility� either directly �as prices� or indirectly �derived from prices�� and
Level 3 � inputs for the asset or lia�ility that are not �ased on o�serva�le mar�et data �uno�serva�le inputs��

�he fair value of financial assets traded in active mar�ets is su�sequently �ased on their quoted mar�et prices at the end of the reporting period without any deduction for estimated future selling costs� �he quoted mar�et price used for financial assets held �y the Group is the current �id price and the quoted mar�et price for financial lia�ilities is the current as�ing price�

�he following ta�le presents the Group’s financial assets and lia�ilities measured at fair value as at 3� �une� Refer to the Critical Accounting Estimates and �udgments note for further details of assumptions used and how fair values are measured�

30 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

	Level 1	Level 2	Level 3	Total balance
	$’000	$’000	$’000	$’000
At 30 June 2015
Financial assets at F��PL	9�15�	�	6�874	16��24
At 30 June 2014
Financial assets at F��PL	6�979	�	6�811	13�79�

(ii) Valuation techniques used to derive Level 3 fair values

�he fair value of the unlisted securities is determined �y reference to the net assets of the underlying entities� �he fair value of the �a�ehouse �onds is measured �y its face value ad�usted for annual CPI movements� su��ect to recovera�ility assessment� All these instruments are included in Level 3�

(iii) Fair value measurements using significant observable inputs (Level 3)

�he following ta�le is a reconciliation of the movements in financial assets classified as Level 3 for the year ended 3� �une�

At 30 June 2015 �alance at the �eginning of year Purchase Sale Fair value movement �alance at the end of year At 30 June 2014 �alance at the �eginning of year Purchase Sale Fair value movement �alance at the end of year	$’000 6�811 225 �444� 282 6,874 6�66� 15� �214� 215
	6,811

�here were no transfers �etween Level 1� 2 and 3 financial instruments during the year�

27. Critical Accounting Estimates and Judgments

�he Directors evaluate estimates and �udgments incorporated into the financial statements �ased on historical �nowledge and �est availa�le current information� Estimates assume a reasona�le e�pectation of future events and are �ased on current trends and economic data� o�tained �oth e�ternally and within the Group�

Key estimates � Impairment

�he Group assesses impairment at each reporting date �y evaluating conditions specific to the Group that may lead to impairment of assets� �he Directors �elieved it appropriate to raise no impairment provisions for the year ended 3� �une 2�15�

Key estimates –Financial Assets

Financial asset provisions have �een raised with reference to the prevailing prices at 3� �une 2�15 of

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

financial assets at F��PL with gains and losses recognised in profit or loss� �he fair value of the unlisted securities is determined �y reference to the net assets of the underlying entities� �he fair value of the listed securities is �ased on the closing price from the Australian Securities E�change as at the reporting date� �he fair value of the �a�ehouse �onds is measured �y its face value ad�usted for annual CPI movements� su��ect to impairment assessment�

28. Statement of Significant Accounting Policies

�lac��all Property Funds Limited is a pu�licly listed company� incorporated and domiciled in Australia� �he financial statements for the Group were authorised for issue in accordance with a resolution of the Directors on the date they were issued�

Basis of Preparation

�hese financial statements are general purpose financial statements that have �een prepared in accordance with Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards �oard and the Corporations Act 2��1� �he financial statements of the Company also comply with IFRS as issued �y the International Accounting Standards �oard�

�he financial statements have �een prepared on an accruals �asis and are �ased on historical costs modified �y the revaluation of selected non�current assets� financial assets and financial lia�ilities for which the fair value �asis of accounting has �een applied�

�he Group is a group of the �ind referred to in ASIC Class Order 98�1�� dated 1� �uly 1998� and in accordance with that Class Order amounts in the Directors’ Report and the financial statements are rounded off to the nearest thousand dollars� unless otherwise indicated�

�he following is a summary of the material accounting policies adopted �y the Group in the preparation of the financial statements� �he accounting policies have �een consistently applied� unless otherwise stated�

New and amended standards adopted by the Group

�he Group has applied the following standards and amendments for the first time for these financial statements�

AASB 2013�5 Amendments to Australian Accounting Standards – Investment Entities

In August 2�13� the AAS� made amendments to the a�ove standard which e�empt investment entities from consolidating controlled investees� �he amendments applied to the Group from 1 �uly 2�14�

AASB 2014�1 Amendments to Australian Accounting Standards – Employee benefits

�he amendments clarify that if the amount of the contri�utions is independent of the num�er of years of service� an entity is permitted to recognise such contri�utions as a reduction in the service cost in the period in which the related service is rendered� instead of attri�uting the contri�utions to the periods of service�

�he Group has adopted these standards and there are no material changes to the Group’s financial statements�

32 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Going concern

�he financial statements have �een prepared on a going concern �asis� which contemplates continuity of normal �usiness activities and the realisation of assets and settlement of lia�ilities in the ordinary course of �usiness�

Segment Reporting

AAS� 8 requires operating segments to �e identified on the �asis of internal reports a�out components of the Group that are regularly reviewed �y the chief operating decision ma�er in order to allocate resources to the segment and to assess its performance� �he Group�s primary format for segment reporting is �ased on �usiness segments� �he �usiness segments are determined �ased on the Group management and internal reporting structure� �here is only one geographical segment �eing Australasia� Segment results� assets and lia�ilities include items directly attri�uta�le to a segment as well as those that can �e allocated on a reasona�le �asis� �he operating �usinesses are organised and managed separately according to the nature of the products and services provided� with each segment representing a strategic �usiness unit that offers different products and serves different mar�ets�

�he Group has adopted four reporting segments� Fund and Property �anagement� Investments� �O�SO �or�Space and �nallocated� Following the acquisition of funds management operations� the Group’s fee earning activities are primarily derived from property assets held within funds or held on �alance sheet� As such the Group’s operations and reporting lines are �etter represented �y consolidating all of the fee earning� operating property �usinesses within the Fund and Property �anagement segment and returns derived �y holding investments in property securities under the segment referred to as Investments�

�he Fund and Property �anagement segment engages in funds and asset management as well as property services that include property management� leasing and general property consultancy� �anagement treats these operations as one �fee earning� operating segment� �he Investments segment includes interests in property related investments such as units in related party listed and unlisted unit trusts� loans and cash� It generates income from dividends� distri�utions� and interest� �he �O�SO �or�Space segment represents the serviced office and co�wor�space �usiness and generates recurring licence and services fees �y providing short�term office accommodation� shared wor�space and meeting and event venues� �he �nallocated segment represents general administrative functions at the head office �e�g� salaries��

Presentation of Financial Statements

�oth the functional and presentation currency of �lac��all Property Funds Limited and its Australian su�sidiaries is Australian dollars� �he New �ealand su�sidiary�s functional currency is New �ealand Dollars� which is translated to presentation currency �refer to Foreign Currency �ranslation note �elow��

Principles of Consolidation

Controlled entities

�he consolidated financial statements comprise the financial statements of �lac��all Property Funds Limited and its su�sidiaries� A list of controlled entities is contained in the Controlled Entities note to the financial statements� All controlled entities have a �une financial year end and use consistent accounting policies� Investments in su�sidiaries held �y the Group are accounted for at cost less any impairment charges �refer to Parent Entity Information note��

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Su�sidiaries are all those entities over which the consolidated entity has control� �he consolidated entity controls an entity when the consolidated entity is e�posed to� or has rights to� varia�le returns from its involvement with the entity and has the a�ility to affect those returns through its power to direct the activities of the entity� Su�sidiaries are fully consolidated from the date on which control is transferred to the consolidated entity� �hey are de�consolidated from the date that control ceases�

Inter�company balances

All inter�company �alances and transactions �etween entities in the Group� including any unrealised profits or losses� have �een eliminated on consolidation� Accounting policies of su�sidiaries have �een changed where necessary to ensure consistencies with those policies applied �y the parent entity�

Non�controlling interests

Non�controlling interests �not held �y the Group� are allocated their share of net profit and comprehensive income after ta� in the statement of profit or loss and other comprehensive income and are presented within equity in the consolidated �alance sheet� separately from parent shareholders� equity� Comprehensive income after ta� in the statement of profit or loss and other comprehensive income are presented within equity in the consolidated �alance sheet� separately from parent shareholders� equity�

Foreign Currency Translation

�he financial results and position of foreign operations whose functional currency is different from the Group’s presentation currency are translated as follows�

assets and lia�ilities are translated at year end e�change rates prevailing at the reporting date�
income and e�penses are translated at average e�change rates for the period� and
retained earnings are translated at the e�change rates prevailing at the date of the transaction�

E�change differences arising on translation of foreign operations are transferred directly to the Group�s foreign currency translation reserve in the �alance sheet� �hese differences are recognised in the profit or loss �on a net �asis� in the period in which the operation is disposed of�

Property, Plant and Equipment

General information

Each class of property� plant and equipment is carried at cost or fair value less� where applica�le� any accumulated depreciation and impairment losses�

Plant and equipment

Plant and equipment are measured on the cost �asis less accumulated depreciation and impairment losses� �he cost of replacing part of an item of property� plant and equipment is recognised in the carrying amount of an item if it is pro�a�le that the future economic �enefits em�odied within the part will flow to the Group and its cost can �e measured relia�ly� �he carrying amount of the replaced part is derecognised� �he costs of the day�to�day servicing of property� plant and equipment are recognised in profit and loss as incurred�

Depreciation

�he deprecia�le amount of all fi�ed assets is depreciated on a diminishing value �asis over their useful lives to the Group commencing from the time the asset is held ready for use�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

�he estimated useful lives used for each class of deprecia�le assets are� Furniture� Fi�tures and Fittings over 2 to 4� years Office Equipment over 2 to 5 years

�he assets� residual values and useful lives are reviewed� and ad�usted if appropriate� at each �alance sheet date�

Disposal

An item of property� plant and equipment is derecognised upon disposal or when no further economic �enefits are e�pected from its use or disposal�

Any gain or loss arising on derecognition of the asset �calculated as the difference �etween the net disposal proceeds and the carrying amount of the asset� is included in the profit or loss in the year the asset is derecognised�

Impairment of assets

At each reporting date� the Group reviews the carrying values of its tangi�le and intangi�le assets to determine whether there is any indication that those assets have �een impaired�

If such an indication e�ists� the recovera�le amount of the asset� �eing the higher of the asset�s fair value less costs to sell and value in use� is compared to the asset�s carrying value� In assessing value in use� either the estimated future cash flows are discounted to their present value using a pre�ta� discount rate that reflects current mar�et assessments of the time value of money and the ris�s specific to the asset� or the income of the asset is capitalised at its relevant capitalisation rate�

An impairment loss is recognised if the carrying value of an asset e�ceeds its recovera�le amount� Impairment losses are e�pensed to the profit and loss�

Impairment losses recognised in prior periods are assessed at each reporting date for any indication that the loss has decreased or no longer e�ists� An impairment loss is reversed if there has �een a change in the estimates used to determine the recovera�le amount� An impairment loss is reversed only to the e�tent that the asset�s carrying amount does not e�ceed the carrying amount that would have �een determined� net of depreciation or amortisation� if no impairment loss has �een recognised�

Financial Instruments

Non�derivative financial instruments

Non�derivative financial instruments comprise investments in equity and de�t securities� trade and other receiva�les� cash and cash equivalents� loans and �orrowings� and trade and other paya�les�

Non�derivative financial instruments are recognised at fair value plus� for instruments not at fair value through profit or loss� any directly attri�uta�le transaction costs� Su�sequent to initial recognition non� derivative financial instruments are measured as descri�ed �elow�

Recognition

A financial instrument is recognised if the Group �ecomes a party to the contractual provisions of the instrument� Financial assets are derecognised if the Group�s contractual rights to the cash flow from the financial assets e�pire or if the Group transfers the financial assets to another party without retaining control or su�stantially all ris�s and rewards of the asset� Purchases and sales of financial assets are accounted for at trade date� i�e� the date that the Group commits itself to purchase or sell the asset� Financial

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

lia�ilities are derecognised if the Group�s o�ligations specified in the contract e�pire or are discharged or cancelled�

Financial assets

�he Group classifies its financial assets in the following measurement categories� those to �e measured su�sequently at fair value and those to �e measured at amortised cost� �he classification depends on the Group’s �usiness model for managing the financial assets and the contractual terms of the cash flows�

(i) Debt investments – at fair value through profit or loss

�he �a�ehouse �onds are classified as a de�t investment at fair value through profit or loss�

(ii) Equity investments

All equity investments are measured at fair value� Equity investments that are held for trading are measured at fair value through profit or loss�

(iii) Loans and receivables

Loans and receiva�les including loans to related entities are non�derivative financial assets with fi�ed or determina�le payments that are not quoted in an active mar�et and are stated at amortised cost using the effective interest rate method� Gains and losses are recognised in profit and loss when the loans and receiva�les are derecognised or impaired� as well as through the amortisation process�

Fair value

�he fair values of investments that are actively traded in organised financial mar�ets are determined �y reference to quoted mar�et �id prices at the close of �usiness on the �alance date� For investments in related party unlisted unit trusts� fair values are determined �y reference to pu�lished unit prices of these investments which are �ased on the net tangi�le assets of each of the investments�

Impairment

At each reporting date� the Group assesses whether there is o��ective evidence that a financial instrument has �een impaired� A financial instrument is considered to �e impaired if o��ective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset� In the case of availa�le�for�sale financial instruments� a prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen�

An impairment loss in respect of a financial instrument measured at amortised cost is calculated as the difference �etween its carrying amount� and the present value of the estimated future cash flows discounted at the original effective interest rate� An impairment loss in respect of an availa�le�for�sale financial asset is calculated �y reference to its fair value�

Individually significant financial instruments are tested for impairment on an individual �asis� �he remaining financial assets are assessed collectively in groups that share similar credit ris� characteristics�

Impairment losses are recognised in the profit or loss� An impairment loss is reversed if the reversal can �e related o��ectively to an event occurring after the impairment loss was recognised� For financial instruments measured at amortised cost� the reversal is recognised in profit and loss�

36 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Financial liabilities

Non�derivative financial lia�ilities are recognised at amortised cost� comprising original de�t less principal payments and amortisation�

Investments in Associates

Investments in associate companies are recognised in the financial statements �y applying the equity method of accounting where significant influence is e�ercised over an investee� Significant influence e�ists where the investor has the power to participate in the financial and operating policy decisions of the investee �ut does not have control or �oint control over those policies�

�nder the equity method of accounting� investments in the associates are carried in the consolidated �alance sheet at cost plus post�acquisition changes in the Group�s share of net assets of the associates� �he Group�s share of its associates� post�acquisition profits or losses is recognised in the income statement� and its share of post�acquisition movements in reserves is recognised in reserves� �he cumulative post acquisition movements are ad�usted against the carrying amount of the investment� �hen the Group�s share of losses e�ceeds its interest in an equity accounted investee� the carrying amount of the interest is reduced to nil and the recognition of further losses is discontinued e�cept to the e�tent that the Group has an o�ligation or has made payments on �ehalf of the investee�

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand� deposits held at call with �an�s� other short�term highly liquid investments with original maturities of three months or less� and �an� overdrafts�

Trade and Other Receivables

�rade receiva�les are recognised and carried at original invoice amount less a provision for any uncollecta�le de�ts� An estimate for dou�tful de�ts is made when there is o��ective evidence that the Group will not �e a�le to collect the receiva�le� Financial difficulties of the de�tor and default payments are considered o��ective evidence of impairment� �ad de�ts are written off when identified as uncollecta�le�

Trade and Other Payables

Lia�ilities for trade creditors are carried at cost which is the fair value of the consideration to �e paid in the future for goods or services received� whether or not �illed to the Group at �alance date� �he amounts are unsecured and are usually paid within 3� days of recognition�

Interest Bearing Borrowings

Interest �earing �orrowings are initially recognised at fair value less any related transaction costs� Su�sequent to initial recognition� interest �earing �orrowings are stated at amortised cost�

Employee Benefits

Defined contribution plans

A defined contri�ution plan is a post�employment �enefit plan under which an entity pays fi�ed contri�utions to a separate entity and will have no legal or constructive o�ligation to pay further amounts� O�ligations for contri�ution to defined contri�ution plans are recognised as a personnel e�pense in profit and loss when they are due�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Other long term employee benefits

�he Group�s net o�ligation in respect of long term employee �enefits other than defined �enefit plans is the amount of future �enefit that employees have earned in return for their service in the current and prior periods plus related on�costs� �hese employee �enefits have not �een discounted to the present value of the estimated future cash outflows to �e made for those �enefits�

Short term benefits

Lia�ilities for employee �enefits for wages� salaries and annual leave represent present o�ligations resulting from employees’ services provided to the reporting date and are calculated at undiscounted amounts �ased on remuneration wage and salary rates that the Group e�pects to pay as at reporting date including related on�costs�

Provisions

Provisions are recognised when the Group has a legal or constructive o�ligation� as a result of past events� for which it is pro�a�le that an outflow of economic �enefits will result and that outflow can �e relia�ly measured� �here the Group e�pects some or all of a provision to �e reim�ursed� for e�ample under an insurance contract� the reim�ursement is recognised as a separate asset �ut only when the reim�ursement is virtually certain� �he e�pense relating to any provision is presented in the income statement net of any reim�ursement�

Revenue

�anagement fees and transaction fees are recognised when it �ecomes legally due and paya�le to the Group�

�O�SO �or�Space income comprises rental and recovery of outgoings from property tenants� Rental income is accounted for on a straight�line �asis over the lease term�

Investment income

Finance income comprises interest on funds invested� gains on the disposal of financial assets at fair value through profit and loss� Interest income is recognised as interest accrues using the effective interest method� Dividend and distri�ution revenue is recognised when the right to receive income has �een esta�lished�

All revenue is stated net of the amount of GS��

Income Tax

Current income tax expense

�he charge for current income ta� e�pense is �ased on the profit year ad�usted for any non�assessa�le or disallowed items� It is calculated using the ta� rates that have �een enacted or are su�stantially enacted �y the �alance sheet date�

Accounting for deferred tax

Deferred ta� is accounted for using the �alance sheet lia�ility method in respect of temporary differences arising �etween the ta� �ases of assets and lia�ilities and their carrying amounts in the financial statements� No deferred income ta� will �e recognised from the initial recognition of an asset or lia�ility� e�cluding a �usiness com�ination� where there is no effect on accounting or ta�a�le profit or loss�

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Deferred tax calculation

Deferred ta� is calculated at the ta� rates that are e�pected to apply to the period when the asset is realised or lia�ility is settled� Deferred ta� is credited in the income statement e�cept where it relates to items that may �e credited directly to equity� in which case the deferred ta� is ad�usted directly against equity�

Deferred ta� assets and lia�ilities are offset if there is a legally enforcea�le right to offset current ta� lia�ilities and assets� and they relate to income ta�es levied �y the same ta� authority on the same ta�a�le entity� or on different ta� entities� �ut they intend to settle current ta� lia�ilities and assets on a net �asis or their ta� assets and lia�ilities will �e realised simultaneously�

Deferred income tax assets

Deferred income ta� assets are recognised to the e�tent that it is pro�a�le that future ta� profits will �e availa�le against which deducti�le temporary differences can �e utilised� �he carrying amount of deferred income ta� assets is reviewed at each �alance sheet date and reduced to the e�tent that it is no longer pro�a�le that sufficient ta�a�le profit will �e availa�le to allow all or part of the deferred income ta� asset to �e utilised�

Benefit brought to account

�he amount of �enefits �rought to account or which may �e realised in the future is �ased on the assumption that no adverse change will occur in income ta�ation legislation and the anticipation that the economic entity will derive sufficient future assessa�le income to ena�le the �enefit to �e realised and comply with the conditions of deducti�ility imposed �y the law�

Tax consolidation

�lac��all Property Funds Limited has elected to form a ta� consolidated group with its wholly�owned entities for income ta� purposes under the ta� consolidation regime with effect from 1 �anuary 2�11� As a consequence� all mem�ers of the ta� consolidated group are ta�ed as a single entity from that date� �he head entity within the ta� consolidated group is �lac��all Property Funds Limited�

In addition to its own current and deferred ta� amounts� �lac��all Property Funds Limited also recognises the current ta� lia�ilities �or assets� and the deferred ta� assets arising from unused ta� losses and unused ta� credits assumed from controlled entities in the ta� consolidated group in con�unction with any ta� funding arrangement amounts�

�he Group recognises deferred ta� assets arising from unused ta� losses of the ta� consolidated group to the e�tent that it is pro�a�le that future ta�a�le profits of the ta� consolidated group will �e availa�le against which the asset can �e utilised�

Any su�sequent period ad�ustments to deferred ta� assets arising from unused ta� losses as a result of revised assessments of the pro�a�ility of recovera�ility is recognised �y the head entity only�

Assets or lia�ilities arising under ta� funding agreements with the ta� consolidated entities are recognised as amounts receiva�le from or paya�le to other entities in the Group�

GST

Revenues� e�penses and assets are recognised net of the amount of GS�� e�cept where the amount of GS� incurred is not recovera�le from the Australian �a�ation Office� In these circumstances the GS� is recognised as part of the cost of acquisition of the asset or as part of an item of the e�pense� Receiva�les and paya�les in the �alance sheet are shown inclusive of GS��

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

FINANCIAL STATEMENTS

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Notes to the Financial Statements

For the Year Ended 30 June 2015

Cash flows are presented in the cash flow statement on a gross �asis� e�cept for the GS� component of investing and financing activities� which are disclosed as operating cash flows�

EPS

�he Group presents �asic and diluted EPS data for its ordinary shares� �asic EPS is calculated �y dividing the profit or loss attri�uta�le to ordinary shareholders of the Company �y the weighted average num�er of ordinary shares outstanding during the year� Diluted EPS is determined �y ad�usting the profit or loss attri�uta�le to ordinary shareholders and the weighted average num�er of ordinary shares outstanding for the effects of all dilutive potential ordinary shares�

Comparative figures

�hen required �y Accounting Standards� comparative figures have �een ad�usted to conform to changes in presentation for the current financial year� Any change of presentation has �een made in order to ma�e the financial statements more relevant and useful to the user�

New Accounting Standards and Interpretations

Certain new accounting standards and interpretations have �een pu�lished that are not mandatory for the current reporting period� �he Group’s assessment of the impact of these new standards and interpretations is set out �elow�

AASB 9 Financial Instruments (effective for annual reporting periods beginning on or after 1 January 2018)

�he Group has early adopted the AAS� 9 on 1 �anuary 2�13 e�cept for the new hedging rules which will not have any material changes to the Group’s financial statements�

40 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

DIRECTORS’ DECLARATION

In the Directors’ opinion�

�a� the financial statements and notes are in accordance with the Corporations Act 2��1� including�
�i� complying with Accounting Standards� the Corporations Regulations 2��1 and other mandatory professional reporting requirements� and
�ii� giving a true and fair view of the consolidated entity’s financial position as at 3� �une 2�15 and of its performance for the financial year ended on that date� and
�� there are reasona�le grounds to �elieve that the Group will �e a�le to pay its de�ts as and when they �ecome due and paya�le�

�he Statement of Significant Accounting Policies confirms that the financial statements also comply with International Financial Reporting Standards as issued �y the International Accounting Standards �oard�

�he Directors have �een given the declarations �y the Chief E�ecutive Officer and Chief Financial Officer required �y section 295A of the Corporations Act 2��1�

�his declaration is made in accordance with a resolution of the �oard of Directors�

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Stuart Brown Director Sydney� 19 August 2�15

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

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Independent Audit Report to the Members of Blackwall Property Funds Limited and Controlled Entities

Report on the Financial Report

We have audited the accompanying financial report of Blackwall Property Funds Limited and Controlled Entities ("the Group"), which comprises the statement of financial position as at 30 June 2015, the statement of profit or loss and other comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the Group.

Directors' Responsibility for the Financial Report

The directors of the Group are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 28, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements , that the financial statements comply with International Financial Reporting Standards .

Auditor's Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements, and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Group’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of the Group, would be in the same terms if given to the directors as at the time of this auditor’s report.

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Independent Audit Report to the Members of Blackwall Property Funds Limited and Controlled Entities

Opinion

In our opinion:

(a) the financial report of Blackwall Property Funds Limited and Controlled Entities is in accordance with the Corporations Act 2001 , including:
(i) giving a true and fair view of the financial position of the Group for the year ended 30 June 2015 and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001 .
(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 28.

Report on the Remuneration Report

We have audited the Remuneration Report included in pages 8 to 9 of the directors' report for the year ended 30 June 2015. The directors of the Group are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001 . Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

Opinion

In our opinion, the Remuneration Report of Blackwall Property Funds Limited and Controlled Entities for the year ended 30 June 2015 complies with section 300A of the Corporations Act 2001 .

Dated at Sydney the 19[th] day of August 2015.

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ESV Accounting and Business Advisors

Chris Kirkwood Partner

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CONTENTS - Notes to the Financial Statements

1�	Segment Information	Page 19
2�	Revenue	Page 19
3�	E�penses	Page 2�
4�	Income �a� E�pense	Page 2�
5�	Current Assets – Cash and Cash Equivalents	Page 2�
6�	Current Assets – �rade and Other Receiva�les	Page 2�
7�	Non�current Assets – Equity Accounted Investments	Page 21
8�	Current and Non�current Assets – Financial Assets	Page 21
9�	Non�current Assets – Property� Plant and Equipment	Page 22
1��	Non�current Assets – Other Assets	Page 22
11�	Current Lia�ilities � Current �a� Paya�les	Page 23
12�	Current and Non�current Lia�ilities – Provisions	Page 23
13�	Non�current Lia�ilities – Other Paya�les	Page 23
14�	Non�current Lia�ilities – Deferred �a� Lia�ilities	Page 23
15�	Share Capital	Page 24
16�	Dividends	Page 24
17�	Earning Per Share	Page 25
18�	Auditor’s Remuneration	Page 25
19�	Commitments	Page 25
2��	Reconciliation of Operating Cash Flows	Page 26
21�	Contingencies	Page 26
22�	Su�sequent Events	Page 26
23�	Controlled Entities	Page 26
24�	Related Party �ransactions	Page 26
25�	Parent Entity Information	Page 28
26�	Financial Ris� �anagement	Page 29
27�	Critical Accounting Estimates and �udgments	Page 31
28�	Statement of Significant Accounting Policies	Page 32

44 BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

GLOSSARY

�lac��all � ��F �lac��all Property Funds Limited �� a�ehouse �uarter �rust ��R �lac��all Property �rust Company �lac��all Property Funds Limited Consolidated annual financial report Financial statements EPS Earnings per share F��PL Fair value through profit and loss Group �lac��all Property Funds Limited � su�sidiaries GS� Goods and services ta� IFRS International Financial Reporting Standards �irela �irela Development �nit �rust ��P �ey management personnel Outside Equity Interest Non�controlling interest p�a� Per annum P�� Pyrmont �ridge �rust PIPES Property Income and Participating Equity Securities

BlackWall Property Funds - Consolidated Annual Financial Report For The Year Ended 30 June 2015

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& Controlled Entities ACN 146 935 131 ABN 37 146 935 131

Level 1, 50 Yeo Street, Neutral Bay, Sydney NSW 2089 Australia PO Box 612, Neutral Bay, Sydney NSW 2089 Australia

www��lac�wallfunds�com�au

AI assistant

BLACKWALL LIMITED — Annual Report 2015

64590_rns_2015-08-18_7d4ef303-0d9f-45ee-b0ed-f3acf762b9a4.pdf

BWF'ASX'Release'

30 June'2015'–'Full'Year'Result

Key$Numbers$

Operating$Income$

Transactions$and$Balance$Sheet$$

New$Fund$

Bakehouse$Bonds$

BlackWall!Property!Funds!Limited! ABN!37!146!935!131!

Financial Report

Principal Activities and Review of Operations

Management

The Bakehouse Quarter

BlackWall Property Trust

Woods PIPES Fund

WOTSO WorkSpace

Share Buy�Back

Significant Changes in Affairs

Events Subsequent to Reporting Date and Likely Developments

Information on Officeholders

Meeting Attendances

Environmental Regulation

Indemnities of Officers

Corporate Governance Statement

Auditor and Non�audit Services

Rounding of Amounts

Remuneration Report (Audited)

Share options

Directors and KMPs’ Relevant Interests

Auditor’s Independence Declaration Under Section 307C of the Corporations Act 2001

ESV Accounting and Business Advisors

1. Shareholders

2. Distribution of Shareholders

3. Substantial Shareholders

BlackWall Property Funds Limited and Controlled Entities

BlackWall Property Funds Limited and Controlled Entities

Consolidated Statement of Financial Position

BlackWall Property Funds Limited and Controlled Entities

BlackWall Property Funds Limited and Controlled Entities

ABN 37 146 935 131

Consolidated Statement of Cash Flows

BlackWall Property Funds Limited and Controlled Entities

1. Segment Information

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

7. Non�current Assets � Equity Accounted Investments

8. Current and Non�current Assets � Financial Assets

(c) Pelathon Pub Group

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

For the Year Ended 30 June 2015

BlackWall Property Funds Limited and Controlled Entities

15. Share Capital and Reserves

(c) Reserves

16. Dividends

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

For the Year Ended 30 June 2015

17. Earnings Per Share

18. Auditor’s Remuneration

19. Commitments

(a)Operating lease commitments

(b) Capital lease commitments

BlackWall Property Funds Limited and Controlled Entities

Notes to the Financial Statements

For the Year Ended 30 June 2015

20. Reconciliation of Operating Cash Flows

21. Contingencies

22. Subsequent Events

23. Controlled Entities

24. Related Party Transactions

(a) Related Entities, Associates and Joint Venture Entities, Managed Funds

Associates and Joint Venture Entities

BlackWall Property Funds Limited and Controlled Entities

BLACKWALL LIMITED Annual Report 2015