CHARTER HALL GROUP — Investor Presentation 2011

Jun 15, 2011

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Managing Charter Hall Office REIT A presentation by Charter Hall Group 16 June 2011

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Executive summary

• Charter Hall Group (ASX:CHC) (“ CHC ”) has outperformed as manager of the Charter Hall Office REIT (ASX:CQO) (“ CQO ”)

• Prior to hedge funds acquiring units, CQO outperformed peers and the S&P/ASX A-REIT 200 Index under CHC management

• CHC has undertaken a number of initiatives over the past 14 months closing the gap between unit price and NTA (asset sales in Europe, Japan and the US, significant debt refinancings and increased annual distribution)

• CHC has a clear strategy to deliver value for CQO unitholders

• CQO (post sale of the US portfolio) comprises a high quality portfolio of predominantly Premium / A-Grade office assets with a high concentration in Sydney / Melbourne markets

• There are significant risks associated with the activist hedge funds proposal

• Activist hedge funds have not articulated how they will address these risks

• CHC is best placed to manage CQO

• CHC is a leading manager of office assets in Australia

• CHC has a 20 year track record in managing Australian institutional real estate and its managed funds have a strong history of outperformance

• CHC is well progressed with the sale of CQO’s US portfolio

• CHC has a clear capital management plan for CQO

• CHC is aligned to the performance of CQO and it is CQO’s largest unitholder with a 10% holding

Contents

1. Charter Hall as manager of CQO

2. CQO Australia strategy

3. Risks associated with the removal of Charter Hall

4. Australian and US office markets

5. Charter Hall credentials

Appendices:

Appendix A – Charter Hall governance and resources

Appendix B – Charter Hall office capability

01 Charter Hall as manager of CQO

Charter Hall has outperformed as manager of CQO

• CHC management initiatives have delivered value to CQO unitholders

• CHC has been an active manager of CQO generating fund outperformance

CQO outperformed the A-REIT index under management by CHC (prior to hedge funds acquiring an interest in CQO)[1]

	Performance of CQO				18.3% p.a.
	Performance of A-REIT Accumulation	200	Index		2.9% p.a.

1: 1 March 2010 to 13 January 2011 IRESS Total Return

• CHC has undertaken a number of initiatives since March 2010 which have contributed to close the gap between unit price and NTA

• €158m of assets sold in Europe and ¥3.5bn of assets sold in Japan

• US$1.7bn asset sale program in the US

• A$965m and US$275m of debt refinanced

• Annual distribution increased by 9.5% in 2011

• Focus on driving income and capital growth from the portfolio

• Experienced and focused management team

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CQO portfolio has achieved higher returns under Charter Hall management

• Key global CQO achievements under CHC management include:

• Leases agreed over 220,000sqm[3 ] of the portfolio:

• Leases executed over 28,231sqm at the Argus Centre, including a new 12 year lease with Telstra over 23,482sqm, increasing both the property WALE from 0.4 years to 11.3 years and the valuation from $114m to $129m[4]

• BHP Billiton secured as anchor tenant of 171 Collins Street, Melbourne

Australian portfolio performance has improved with CHC management

		Pre CHC1	Post CHC2
	WALE	3.9 years	4.4 years
	Tenant retention 6 month leasing	81.0% 24,371sqm	89.0% 53,715sqm

  - 1: As at 31 December 2009 – MOF results presentation

  - 2: As at 31 December 2010 – CQO results presentation

• Promenade 2, Atlanta – terms agreed over 61,326sqft since 31 December 2010

• 171 Collins Street is forecast to achieve strong IRRs and is scheduled to reach practical completion in FY13

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Charter Hall has undertaken active management of CQO’s Australian portfolio

• CHC has a fully integrated real estate platform enabling in-house value creation across the asset life cycle

• Asset and property management systems, development capability and tenant relationships reduce risk, create value and enhance asset performance

• CHC has leased more than 70,000sqm in Australia[3]

CQO Australian vacancy is much lower than the market[1]

		CQO	Prime market2
	Melbourne CBD Sydney CBD	2.7% 4.3%	4.4% 7.7%

1: As at 31 December 2010

• CQO achieved 10% outperformance on market rental growth

• 2: Source JLL

• CHC is best placed manager to continue to drive outperformance of the CQO portfolio

• CQO under CHC management has achieved NABERS rating of 4.4 and is a member of the FTSE4Good Index

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CQO has higher tenant retention than peers [5]
89%
71%
63%
CQO CPA IOF
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CQO has higher occupancy than peers [4]
95%
94% 94%
CQO CPA IOF
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Divestment of US portfolio

• In line with CQO’s stated strategy to reweight to Australia, CQO has commenced the final phase to sell its US portfolio

• CQO engaged Bank of America Merrill Lynch to run an independent sale process to sell the US portfolio

• 28 expressions of interest at the conclusion of the first phase for all and parts of the portfolio

• A shortlist of bidders have been selected to enter the second phase of bidding and conduct due diligence

• A removal of the CQO Responsible Entity is likely to destabilise the US sale process

• Possibility that bidders may withdraw due to uncertainty

• Will trigger pre-emptive rights in favour of certain joint venture partners

• It is highly unlikely that a replacement RE with no knowledge of the complexities of the US assets will be able to maximise the net proceeds of the sale process

• CHC is clearly best placed to manage the sale of the US assets

• Intimate knowledge of the assets

• Minimise leakage associated with joint venture issues, debt, leasing agreements and the finalisation of major re-leases and / or new leases

• Involvement in process to date

CQO management has significant experience in executing US real estate transactions - $6.8bn US assets bought and sold[1]

US$1.2b Maguire Chicago sold for JV formed US$171.5m 2006 2007 2008 Boston sold for US$50.4m

Enters US via 80% acquisition of 1 & 3 Christina-$114m

Take over of Principal America Office Trust portfolio (11 properties), sold 2 Dallas properties for $11m profit and re-

Miami sold for US$182.5m

Begins execution of strategy to reduce exposure to Offshore 2010 2011 CQO appoints Bank of America Merrill Lynch on

02 CQO Australia Strategy

Overview

• CQO (post sale of the US) will comprise a high quality portfolio of 19 assets with a value of $1.9bn

• Predominantly Premium / A-Grade (92%)

• CQO is focused on key growth office markets (Sydney and Melbourne) with strong demand and limited supply

• Conservative capital structure (25-35% target gearing), with a diversified debt maturity profile

• Stable, growing earnings growth underpinned by strong tenant relationships and high quality tenant covenants, with a diversified lease expiry profile (4.4 year WALE)

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CQO is focused on high growth markets of Sydney and
Melbourne [1]
USA
Europe
SA
ACT
WA
QLD
VIC
NSW
CQO CPA IOF
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CQO has highest quality portfolio amongst office peers (92% prime and A-Grade assets)[1]

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Europe
Dutch Office
Fund
US
B
A
Prime
CQO CPA IOF
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CQO Australia strategy

• CQO’s strategy is focused on maximising attractiveness of CQO to investors to capture income/capital growth from the portfolio that will result in further closing the gap between NTA and unit price, underpinning strong investor total share return

		Generate sustainable, growing earnings from a portfolio of prime Australian office assets focused on high quality
		CBD office buildings in Sydney and Melbourne, with measured exposure to Perth and Brisbane
		Enhance returns through measured exposure to office developments / refurbishment opportunities
Portfolio		Improve portfolio occupancy and maintain high tenancy retention
strategy		-Continue to renew and lease unoccupied space with investment grade and government tenants on high quality covenants
		Maintain well diversified portfolio (geography and tenant)
		Selective divestment of non-core assets
		Continue to be a real estate market leader in environmental sustainability across the portfolio
		Focused on capital management initiatives to reduce the unit price to NTA gap
Capital		Maintain appropriate gearing (25-35%)
structure		Extend and diversify average debt maturity
		Intention to make a significant capital return on sale of US portfolio

CQO is an enhanced vehicle post sale of the US

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Reduced gearing [1]
43% (13%)
c.30%
Pre-sale of the US Post-sale of the US
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Higher occupancy [1]
95%
8%
87%
Pre-sale of the US Post-sale of the US
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Portfolio is focused on key Australian markets [1]
USA
ACT
WA
QLD
VIC
NSW
Pre-sale of the US Post-sale of the US
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Enhanced tenant retention [1]
7% 89%
82%
`
Pre-sale of the US Post-sale of the US
12
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Australian portfolio statistics

Top 10 tenants (by gross income)[1]

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Australian Government 21%
Macquarie Group Ltd 9%
Telstra Corporation Ltd 8%
Citigroup 7%
Allianz 4%
Gilbert & Tobin 3%
Wilson Parking 3%
Deacons 2%
Credit Union
2%
Australia Ltd
Caltex 2%
Annual lease expiry (by NLA) [1]
26%
18%
16%
13%
9%
5% 7% 6%
Vacant Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17+
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Asset diversification (by gross value)[1]

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Tenant type diversification (by gross income)[1]

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Supportive capital structure

• CQO (post sale of US portfolio) will have gearing of c30%

• Recommend gearing policy (25-35%)

• Recommend target payout range (80-90%)

• Weighted average debt maturity of three years

• Management has agreed terms for a three year $290m back stop facility to refinance its Australian Commercial Mortgage Backed Security (“ CMBS ”) facility that matures in September 2011

CQO Australia debt maturity profile underpins strength of earnings with Syndicate and CMBS facility refinanced

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Syndicate
600 Syndicate
CHC refinanced – 23 December 2010
500
400 CMBS
New facility
300 CHC refinanced – 15 June 2011
200
100
0
Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15
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03 Risks associated with the removal of Charter Hall

Removal of Charter Hall as manager or winding up

Breach of		Change of RE of CQO will trigger a change in control in debt documentation causing an “event of default”
debt		Upon an “event of default”, Banks have the ability to prevent the payment of distributions / return of capital above
covenants		$200m and accelerate debt repayment / force the sale of assets
Trigger pre-
emptive rights		Change of the RE may trigger pre-emptive rights and tag-along / drag-along rights in certain jointly owned assets
in joint venture		in Australia and US
documents
		CQO has a net capital gain within its Australian portfolio of $555.8m
		CQO Australian resident unitholders are liable at their marginal rate of tax if Australian assets are sold and capital
Inherent		is returned to CQO unitholders. The highest marginal tax rate, after applying any relevant discount capital gains,
capital gain		is 30.0% for companies, 23.3% for individuals and trusts and 10.0% for complying superannuation funds
		CQO non-Australian resident unitholders will have the tax liability on their pro rata share of any capital gain at
		7.5% for those unitholders in EOI countries and 30.0% for unitholders in non-EOI countries
Asset pricing on sales	 	Forced asset sales in Australia will likely promote discounts to book value There is currently c$13bn1of institutional real estate “on market” and selling the CQO Australian portfolio is unlikely to maximise proceeds for unitholders
Alternate manager		Hedge funds proposal for an alternative manager is opaque, providing no information about any alternative manager, their experience, remuneration, independence, governance protocols, directors or experience and qualifications	16

Questions that CQO unitholders should be asking “activist hedge funds” and their advisers

• Who is your proposed replacement responsible entity (“ RE ”) for CQO? What is their relevant experience?

• Who are the directors of the replacement RE and their skills / experience?

• How will you give comfort to CQO unitholders that decisions taken by the new RE will not be taken only to suit your / the hedge funds interests?

• What will be your distribution policy for CQO and will you guarantee payment of distributions by CQO?

• Can you guarantee that CQO lenders will not seek early repayment of debt following a change of RE and event of default which may prevent CQO from returning capital to unitholders following the sale of the US portfolio?

• How will you manage the rights that certain joint venture partners may have following a change in RE to buy out our interest in jointly owned assets?

• What is your capital management plan for CQO and ongoing financing arrangements / how will you manage the relationship with CQO lenders?

• How will you manage the potential Australian tax risks on selling Australian assets?

• Do you commit to retaining CQO as an ASX listed and Australian governed entity?

04

Australian and US Office Market

Australia: office is at a cyclical trough with fundamentals ensuring high risk adjusted returns

• Australian office markets are in recovery from a cyclical trough post the GFC

• Strong demand drivers for office space with improved business conditions and economic activity

• The Australian pipeline for office supply in CBD markets is significantly more restrained than previous cycles given the lack of finance and limited development sites

• JLL forecasts cap rate compression of 50bps over the next two years

• CHC has capitalised on the cyclical trough pricing acquiring c$500m of office assets over the past 12 months and is currently developing $1bn in pre-leased office projects

Vacancy rates have fallen across all CBD office markets, particularly H2 2010

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Source: Macquarie Capital Advisors, Jones Lang LaSalle

Demand for office space in Australian CBD markets is increasing

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Supply pipeline is limited in Australian office market

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US: Significant demand for office assets however, fundamental issues persist in the market

• Sales of office property in the US is currently in an upswing

• Driven by capital focused on high quality assets and availability of debt at a low cost

• In 2009, US$14bn of investment grade office was transacted and in 2010 this increased to US$36bn[1]

• In H2 FY10, the weighted average price per square foot of A-Grade office properties was on par with asset prices in late 2006[1]

• Significant vacancy across the US office markets with average vacancy of 18.6% (peaked at 18.9% in mid 2010)[1]

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US office rental growth is soft [2]
10%
5%
0%
-5%
-10%
2007 2008 2009 2010 2011
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• Rents bottomed in most US office markets in 2010 and are starting to grow, albeit slowly, with 1.1% growth

• forecast in 2011[2]

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Historic high vacancy persists in the US office market [2]
200 Absorption Stock Vacancy 20%
15%
100
10%
0
5%
-100 0%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
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05 Charter Hall credentials

Charter Hall Group

• CHC is the largest independent specialist Australian real estate fund manager with greater than $10bn of FUM

• Diversified property group with a vertically integrated business model providing a holistic solution to property outcomes

• Over 270 staff located across six offices

• Diversified across risk / return spectrum and equity sources

Charter Hall Group (ASX:Charter Hall) – $10.4bn under management Stapled Security

Charter Hall Property Trust (CHPT)

Charter Hall Limited (CHL)

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$283m co-investment $163m co-investment
Listed Funds Wholesale
Unlisted Funds
$5.8bn FUM $3.2bn FUM
$140m co-investment $19m investment
Retail Investor Direct Property
Funds
$1.5bn FUM $19m FUM
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 Investment management
 Asset management
 Property management
 Development management
 Leasing services
 Transaction services
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$27m investment
CIP
50% interest
$31m co-investment
Wholesale Opportunistic
Investments in CHOF4 and CHOF5
22
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Overview - Skills across all sectors

 Charter Hall is the only Australian real estate fund manager with skills across all core sectors and asset types with ~100 asset / property management staff in Australia

DIVERSIFIED VEHICLES OPPORTUNISTIC (Development) Charter Hall Opportunistic Fund 4 / Charter Hall Opportunistic Fund 5 CORE PLUS OFFICE VEHICLES INDUSTRIAL VEHICLES (70% Core 30% Enhanced) Core Plus Office Fund Core Plus Industrial Fund

DIVERSIFIED VEHICLES Charter Hall Direct Property Fund / Charter Hall Diversified Property Fund Charter Hall Investment Funds / Charter Hall Umbrella Fund CORE INVESTMENTS OFFICE VEHICLES RETAIL VEHICLES INDUSTRIAL VEHICLES Charter Hall Office REIT Charter Hall Retail REIT Direct Industrial Fund No. 1 Martin Place Trust Direct Retail Fund

OFFICE

INDUSTRIAL

RETAIL

Charter Hall – Funds Management Platform

• CHC manages two listed funds, twelve retail unlisted funds and six wholesale unlisted funds across a diverse range of property sectors

• CQO is CHC’s largest fund, with the highest co-investment, providing significant alignment

• CHC committed to driving value and performance in line with the investment mandate of the REIT

• 20 year track record of outperformance (consistent record of performing through cycles)

• Details on the CHC management team are contained in appendix B

Office

$6.7bn AUM $337m co-invested

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Retail $2.2bn AUM $169m co-invested

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Other $0.9bn AUM $42m co-invested

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Industrial $0.6bn AUM $58m co-invested

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Office is a core capability

 Office is the core competency of CHC

• A$6.7bn office AUM across Australia and the US

• 74 office assets globally

• Over 1.5m sqm of office properties owned or managed

• Manages circa 5% of Australian CBD office space

• Integrated office management capability with vertically integrated platform

• Investment, asset and development management

• Property management and leasing

• Transaction services

• Over 270 staff across the platform

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CHC is the leading manager of office assets [1]
$6.7bn $6.3bn
$5.7bn
$5.0bn
$4.6bn
Charter Dexus Investa GPT Colonial
Hall
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• Excellent track record in delivering major office developments

• 275 George Street, Brisbane CBD (40,000sqm A-Grade) – Telstra, British Gas (QGC)

• Alluvion – 58 Mounts Bay Road, Perth CBD (22,500sqm A-Grade) – Clough Engineering

• Space 207 - St Leonards (20,000sqm A-Grade) – Hutchison Telecom

• Atrium, 60 Union St, Pyrmont (20,000sqm A-Grade) – American Express

• 171 Collins Street, Melbourne CBD (under development, 31,000sqm Premium) – approx 12,000sqm pre-commitment from BHP Billiton

Disclaimer

This presentation has been prepared by Charter Hall Group (Charter Hall Limited (ABN 57 113 531 150) and Charter Hall Funds Management Limited (ABN 31 082 991 786) (AFSL 262861) as the responsible entity for Charter Hall Property Trust (ARSN 113 339 147). It is a presentation of general information as at 31 December 2010 unless otherwise stated. It is a summary and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. A reader should, before making any decisions in relation to their investment or potential investment in the Charter Hall Group, seek their own professional advice. This presentation is not an offer or invitation for subscription or purchase of securities or other financial products.

Appendix A - Charter Hall Governance and Resources

Charter Hall Governance

• Charter Hall operates under a strict corporate governance and risk management framework

• Charter Hall Office Management Limited has adopted additional protocols (in additional to existing protocols) recognising

• potential conflicts that may arise in relation to the US and giving consideration to alternate proposals

• Pursuant to these protocols an Independent Committee of Non-Executive Directors of CHOML has been established

• comprising Roger Davis, Andrew Love and Jim Broadbent

• All decisions relating to CQO’s sale of the US portfolio and the returns of proceeds are decided by the committee

• The Independent Committee have appointed Gilbert & Tobin to act as legal adviser and Fort Street Advisers to act as financial adviser

Independent Director Committee of CQO

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Roger Davis Independent Chairman

Andrew Love Independent Director

Jim Broadbent

Independent Director

Member of Audit, Risk and Compliance Committee. A qualified certified practising accountant, Roger Davis brings more than 30 years experience in banking and investment banking in Australia, the US and Japan to the Board. Currently, he is a consulting director at Rothschild (Australia) Limited and a director of Aristocrat Leisure Limited, Trust Company Limited and TIO. He is also a director of Ardent Leisure Management Limited and Bank of Queensland. Previously, he was Managing Director at Citigroup where he worked for more than 20 years and more recently was a group managing director at ANZ Banking Group. His previous board experience includes the chairmanship of Esanda, along with directorships of ANZ (New Zealand) Limited, Magellan Financial Group Ltd and Citicorp Securities Inc. in the United States. He has a BEc (Hons) from the University of Sydney and an MPhil from the University of Oxford.

Andrew has been involved with the reconstruction and insolvency industry for over 30 years. He has advised local and international banks over many years on a variety of local and overseas assignments. He started Ferrier Hodgson’s Asian expansion as founding partner of the Hong Kong office in 1985. He is currently Chairman of ROC Oil Ltd, Deputy Chairman of Riversdale Mining Ltd and also sits on the board of Puma Financial Management Limited.

.

Member of Audit, Risk and Compliance Committee. Jim Broadbent’s deep understanding and knowledge of real estate has been built over 40 years in the property investment and funds management industry, including a decade as Managing Director of MEPC Australia Limited, a major property investment and development company. He is a qualified real estate valuer, a fellow of the Australian Property Institute and an associate of the Real Estate Institute. His previous board experience includes directorships of the management companies of Austore Property Trust and Oakford Property Trust.

Charter Hall Resources

Charter Hall Joint Managing Directors

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David Harrison Joint Managing Director

As Charter Hall Group’s Joint Managing Director, David Harrison is jointly responsible for all aspects of the Charter Hall business, with specific focus on Funds, Asset and Property Management operations. David also substantially contributes to investment sourcing, capital raisings and structuring of transactions. In addition to his responsibilities on the various unlisted Fund Boards and Investment Committees, David is an Executive Director of the Charter Hall Office REIT Board and the Charter Hall Retail REIT and is Chairman of the Charter Hall Direct Responsible Entity Board. David has more than 24 years of experience in the Australian commercial property market and has jointly overseen the growth of the Charter Hall Group from $500m to $10bn of assets under management in six years. David has been principally responsible for transactions exceeding $13bn of commercial, retail and industrial property assets across all property sectors. Prior to joint Charter Hall, David was Managing Director of Savills in Australia, an international commercial real estate agency business. David holds a Bachelor of Business Degree (Land Economy) from the University of Western Sydney and a graduate Diploma in Applied Finance from the Securities Institute of Australia, whilst also being a Fellow of the Australian Property Institute (FAPI).

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David Southon Joint Managing Director

David is a co-founder of Charter Hall Group. As Charter Hall Group’s Joint Managing Director, one of David’s key focuses is wholesale opportunistic funds and the operation of the Development Division. He is an Executive Director on the Boards of Charter Hall Retail REIT and Charter Hall Office REIT as well as the Responsible Entity Board of Charter Hall Direct Funds. He is also on the Investment Committees of the Group’s series of opportunity funds. He has over 22 years of property industry experience and is responsible for overseeing project origination, project strategy and the formulisation and implementation of Group strategy, together with the Charter Hall Executive Committee and the Board. In addition, David is involved in the procurement and divestment of investment properties for the various Funds managed by the Group. Prior to co-founding Charter Hall in 1991, David was a Development Manager with Eurolynx Limited, the Heine Group’s property arm, and prior to that with Leighton Properties. David holds a Bachelor of Business Degree (Land Economy) from the University of Western Sydney and is a Fellow Member of the Australian Property Institute (FAPI).

Charter Hall Resources

CQO Management Team

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Adrian Taylor Chief Executive Officer

Prior to joining Charter Hall Adrian was an executive director of Macquarie Capital Funds Limited. As the current CEO of CQO, Adrian contributes to the strategy and objectives for the REIT in conjunction with the Board and guides the portfolio management, capital transactions, marketing and trust management teams to execute the REIT's strategy. Adrian also has considerable joint venture experience in Australia and the US. Adrian is a certified practising accountant. He holds a BBus from Monash University is a Fellow of the Financial Services Institute of Australasia and is involved in numerous property industry groups including the Property Council of Australia.

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Jill Rikard-Bell Chief Operating Officer

Jill has 21 years real estate experience and is Chief Operating Officer for CQO. Jill has a broad international real estate experience having worked as a chartered surveyor in London for 9 years prior to joining Macquarie in Sydney in 1999 together with her extensive involvement in establishing and ongoing involvement in CQO’s Australian and offshore portfolio. She’s involved in setting the overall strategy and objectives for Charter Hall Office with the Board and guiding the portfolio management, capital transactions, marketing and trust management teams to execute the strategy.

Jill has been extensively involved in capital transactions, including overseeing the recent disposals in Europe of approximately A240m. During her involvement in CQO Jill has also been actively involved in debt, equity and hybrid capital raisings and has considerable Joint Venture experience. Jill is a qualified Charter Surveyor, is a member of the Royal Institute of Chartered Surveyors (MRICS), and holds a BSc (Hons) from Oxford Brookes University.

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Craig Newman Head of Asset Management

Craig is the Head of Asset Management for Office and Industrial in Charter Hall Group. Prior to Charter Hall, Craig was a Division Director and the Head of Portfolio Management for the Macquarie Office Trust and Macquarie Direct Property Fund for nine years. Craig is responsible for the national Asset Management team, with offices and team members in Sydney, Melbourne Brisbane and Perth, looking after a total of over 70 assets and 650 tenants.

Craig previously worked at Multiplex (now Brookfield Multiplex) in project development role and prior to that was as a qualified valuer with an independent valuation firm in Melbourne for over 5 years. Craig has a Bachelor of Business (Property) from RMIT University and is an Associate of the API.

Appendix B - Charter Hall office capability

Charter Hall office capability

Case Study – 171 Collins Street, Melbourne

• 31,000m[2 ] Premium Grade CBD office asset with a targeted 6 star green star as built environmental rating

• CHC development manager for CQO

• Sold 50% interest to CBUS Property in December 10

• BHP Billiton secured as anchor tenant - 12,000 sqm (38% of building) for a 10 year initial term

• On completion in FY13, 171 Collins Street will be CQO’s flagship Melbourne asset

• Forecast to achieve a project IRR in excess of 15%

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Charter Hall office capability

Case Study – Brisbane Square

• Off-market acquisition of a new core office asset (57,000sqm)

• Fully leased to government institution (54%) and domestic bank (45%) reflecting an 11 year WALE

• Passing income 40% below market rent and purchase price 30% below replacement cost

• Joint venture ownership structure with TelstraSuper on a 50:50 basis

• CHC team completed full due diligence program on the asset and holding entities on behalf of the joint venture partner in a highly compressed time frame.

• Expected property IRR in excess of 200bps above core total return benchmark

• Purchase price at 14% below independent valuation

• CHC engaged to perform the ongoing asset and property management function

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Charter Hall office capability

Select Charter Hall Group office asset development projects

275 George Street, Brisbane Qld

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More than 40,000m² of A-Grade office and retail space over 30 levels, this ecological sustainable building is targeting 4.5 Star NABERS Rating and a 5 star Green Star as built rating.

Fund: 50% owned by CPOF, 50% owned by K-REIT Completion date: July 2009 Value on completion: $330.0m

130 Stirling Street, Perth WA

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Comprises 11,900m² of A-Grade office space spread over 4 levels with an abundance of parking.

Fund: 130 Stirling Street Trust Completion date: July 2009 Value on completion: $71.6m

Alluvion, 58 Mounts Bay Road, Perth WA

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Alluvion is located within the heart of the Perth and comprises 22,384m² of A-Grade office space over 14 floors. Embracing the latest in environmental design, Alluvion aims to achieve a 4.5 star NABERS Rating and a 4 star Green Star Rating.

Fund: 50% developed by CHOF4, sold Completion date: July 2010 Value on completion: $190.0m

151 Pirie Street, Adelaide SA

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151 Pirie Street is an A-Grade building covering 12,650m² of commercial office and retail space spread over 9 levels. The building has been designed to achieve a 4.5 star NABERS Rating.

Fund: Sold

Completion date: March 2006 Value on completion: $61.8m

Space 207, North Shore NSW

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Space 207 is a North Shore office development comprising two towers providing approximately 20,000m² of A-Grade office and retail space plus basement parking for 200 cars.

Fund: Sold

Completion date: September 2004

40 Creek Street, Brisbane Qld

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Located in the heart of Brisbane's financial precinct, the property was completed refurbished in June 2009 and comprises 12,986m² of commercial space, and car parking for 70 cars.

Fund: CHOF5 Completion date: Early 2009