CROMWELL PROPERTY GROUP - Proxy Solicitation & Information Statement 2010

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8 June 2010

The Manager Company Announcements Platform ASX Limited Level 4, Exchange Centre 20 Bridge Street SYDNEY NSW 2000

Dear Sir/Madam

RE: CROMWELL GROUP – CROMWELL DIVERSIFIED PROPERTY TRUST MEETING – PLACEMENT RATIFICATION, CONSTITUTIONAL AMENDMENT AND ACQUISTION PROPOSAL

Attached are a Notice of Meeting, Explanatory Memorandum and Proxy Form relating to four resolutions to be considered by Cromwell Diversified Property Trust (“the Trust” or “DPT”) unitholders at a meeting to be held in Brisbane on 7 July 2010. These documents are expected to be sent to unitholders on Friday 11 June.

Resolution 1 or, in the alternative, resolution 3 will, if passed, retrospectively approve the issue of stapled securities to Redefine Australian Investments Limited that occurred on 29 December 2009 (“the Placement Ratification”). This will refresh the ability of the Trust to issue up to 15% additional units without having to get securityholder approval under ASX Listing Rule 7.1. Resolution 2 is to amend the Trust’s constitution to simplify the voting requirement for future placement approvals or ratifications (“the Constitution Amendment”). If approved by securityholders, these resolutions will ensure that the Group is in a position to readily issue additional equity to capitalise on opportunities when they arise.

Resolution 4 is to allow the Group to acquire two properties from the Cromwell-managed Cromwell Property Fund and undertake some related transactions (“the Acquisition Proposal”). The properties are 321 Exhibition Street in Melbourne (“Exhibition Property”) and a one-third interest in the Therapeutic Goods Administration Complex in Canberra (“TGA Property”). If approved by securityholders, the Acquisition Proposal will result in the Group owning all the TGA Property and the Exhibition Property.

. Cromwell Group securityholders in their role as a shareholder in Cromwell Corporation will also be sent another set of documents today asking them to vote as a shareholder on the Placement Ratification. The Placement Ratification requires the approval of securityholders, both as unitholders and shareholders, for it to be effective.

Yours faithfully

CROMWELL CORPORATION LIMITED CROMWELL PROPERTY SECURITIES LIMITED

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NICOLE RIETHMULLER COMPANY SECRETARY

CROMWELL GROUP

Cromwell Corporation Limited ABN 44 001 056 980

Cromwell Property Securities Limited ABN 11 079 147 809 AFSL 238052 as responsible entity for Cromwell Diversified Property Trust ABN 30 074 537 051 ARSN 102 982 598

Investment Enquiries 1800 334 533 | Property Management 1800 005 657

673115_1.DOC

P 07 3225 7777 | F 07 3225 7788 | E [email protected] | W www.cromwell.com.au | A Level 19 200 Mary Street, GPO Box 1093 Brisbane QLD 4001

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EXPLANATORY MEMORANDUM In relatIon to four resolutIons to be voted on by unItholders

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This is an important document and requires your immediate attention. You should read this document in its entirety before deciding how to vote on the four resolutions outlined in this document. If you are in any doubt about what to do, you should consult your legal, investment, taxation or other professional advisor.

The Board recommends that you vote in favour of the resolutions.

Cromwell Group (ASX:CMW ) comprising Cromwell Corporation Limited aCn 001 056 980 (“CCl” or “the Company”) and Cromwell Diversified Property Trust arsn 102 982 598 (“dPt” or “the trust”). this document is issued by Cromwell Property Securities Limited aCn 079 147 089 afsl 238052 (“CPsl”) as responsible entity of the trust.

EXPLANATORY MEMORANDUM

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	Cromwell Groupstapled security (asX: CMW)	Cromwell Groupstapled security (asX: CMW)	Cromwell Groupstapled security (asX: CMW)	Cromwell Groupstapled security (asX: CMW)	Cromwell Groupstapled security (asX: CMW)
Entities		Cromwell Diversifed		Cromwell Corporation
		Property Trust			Limited
		(“the Trust” or “DPT”)		(“the Company” or “CCL”)


	Due to the structure of stapled		securities, securityholders are
	legally unitholders in the Trust and shareholders in the Company,
	which means they are required to vote				in these capacities
Securityholders	independently.
		Unitholders			Shareholders


Resolution 1
or Resolution 3	PR The Placement Ratifcation			PR The Placement Ratifcation

Resolution 2	PR The Constitution Amendment

Resolution 4	AP The Acquisition Proposal

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1. LETTER fROM ThE chAiRMAN

Dear Securityholder,

The Notice of Meeting, Explanatory Memorandum and associated proxy voting form relate to four resolutions to be considered by Cromwell Group securityholders.

Resolutions 1 and 3 are to retrospectively approve the issue of stapled securities to Redefine Australian Investments Limited that occurred on 29 December 2009 (“the Placement Ratification”). This will refresh the ability of the Cromwell Diversified Property Trust (“the Trust” or “DPT”) to issue up to 15% additional stapled securities without having to get securityholder approval under ASX Listing Rule 7.1.

Resolution 2 is to amend the Trust’s constitution to simplify the voting requirement for future placement approvals or ratifications (“the Constitution Amendement”).

If approved by securityholders, Resolutions 1, 2 and 3 will ensure that the Group is in a position to readily issue additional equity to capitalise on opportunities when they arise.

Securityholders should consider the implications of the Placement Ratification, the Constitution Amendment and the Acquisition Proposal independently of each other because they will vote on each resolution separately.

Directors’ Recommendation

The Directors of Cromwell Property Securities Limited (“CPSL”) unanimously recommend that you vote in favour of the Placement Ratification, the Constitution Amendment and the Acquisition Proposal.

Your Vote is Important

If the resolutions are to be approved, they will require the support of securityholders. I urge you to read this Explanatory Memorandum and to express your opinion on the resolutions by voting in person or by proxy or by power of attorney at the meeting to be held in Brisbane at 1.30pm, 7 July 2010.

As Cromwell Group is a stapled security comprised of two separate legal entities, you as a securityholder also play two roles; as a unitholder in the Trust to which this correspondence relates, and as a shareholder in Cromwell Corporation Limited (“the Company” or “CCL”).

In your capacity as a shareholder in the Company, you should have received another set of documents approximately one week ago asking you to vote as a shareholder on the Placement Ratification. The Placement Ratification requires your approval, both as a unitholder and shareholder, for it to take affect.

If voting by proxy, please ensure you complete both the Company and the Trust proxy forms or vote for all resolutions online at www.cromwell.com.au/registry.

Further Information

If after reading this Explanatory Memorandum you have any questions relating to the proposed resolutions please contact your financial advisor or broker, or call our information line within Australia on 1800 334 533 or outside Australia on +61 3225 7777.

Thank you for your continued support of Cromwell Group and for your consideration of the proposed resolutions.

Yours faithfully

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Geoffrey H Levy, AO Chairman

Independent Expert’s Report

The Independent Expert, Deloitte Corporate Finance Pty Limited, has considered the Acquisition Proposal and is of the opinion that, “the Acquisition Proposal is fair and reasonable”.

An Independent Expert’s Report is not required for the Placement Ratification or the Constitution Amendment.

EXPLANATORY MEMORANDUM 1

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1	Letter from the Chairman	1	4.5	TGA Property	19
	Important Information	2	4.6	Impact on Portfolio	20
2	What Should I Do?	3	4.7	Financial Impact of Acquisition	22
			4.8	Advantages & Disadvantages	26
3 3.1	placEmEnt RatIFIcatIon anD constItutIon amEnDmEnt Summary	4 5	4.9 4.10 4.11	Valuation (TGA Property) Valuation (Exhibition Property) Independent Expert’s Report	28 36 45
3.2	Legal & Regulatory Requirements	7
			5	FuRtHER InFoRmatIon	82
4	acQuIsItIon pRoposal	10	5.1	Directors’ Recommendation	83
4.1	Summary	11	5.2	Additional Information	84
4.2	Frequently Asked Questions	12	5.3	Glossary	91
4.3	Legal & Regulatory Requirements	16	5.4	Directory	92
4.4	Exhibition Property	17

Important Information

this explanatory Memorandum is issued by Cromwell Property securities limited (CPsl) as the responsible entity of dPt. you will also have received a notice of Meeting and explanatory Memorandum for CCl. shares in CCl are stapled to units in the trust and together CCl and the trust constitute the listed Cromwell Group. the CCl shareholder meeting will be held at the same time as the unitholder meeting for the trust. securityholders at the record date will be entitled to vote at both meetings.

Purpose of this Explanatory Memorandum

this document explains the resolutions proposed in the notice of Meeting for the meeting of trust unitholders to be held on 7 July 2010. accordingly this document should be read in conjunction with the notice of Meeting.

It provides unitholders with information about the proposal to ratify the placement of 104,750,000 stapled securities to redefine australian Investments limited on 29 december 2009 (“the Placement Ratification“). It also provides unitholders with information about suggested amendments to the dPt constitution to simplify voting requirements in relation to approvals or ratifications of placements (“the Constitution Amemdment”).

further, it provides unitholders with information about the proposed acquisition by the trust of 321 exhibition street, Melbourne, and the one-third interest in the tGa Complex in Canberra that it does not own, from the Cromwell Property fund (arsn 119 080 410) (“CPf”), as well as certain related transactions (“the Acquisition Proposal“). CPsl is the responsible entity of the trust and CPf.

If you have any questions please contact your financial, tax or other advisor, or our information line within australia on 1800 334 533 or outside australia +61 7 3225 7777.

Financial product advice

this explanatory Memorandum has been prepared without taking into account any securityholder’s objectives, financial situation or needs. therefore, in making a decision on how to vote in relation to the resolutions, securityholders should read this explanatory Memorandum in its entirety and assess, with or without a financial or tax advisor, whether any advice contained within this explanatory Memorandum is appropriate given the securityholder’s objectives, financial situation or needs.

CPsl and its related bodies corporate, and their associates, do not receive any remuneration or benefits for the general advice given in this explanatory Memorandum. directors and employees of CPsl and its related bodies corporate do not receive specific payments of commissions for the authorised services provided under CPsl’s australian financial services licence. they do receive salaries and may also be entitled to receive bonuses, depending upon performance.

Preparation of this Explanatory Memorandum

this explanatory Memorandum contains financial and taxation information prepared by CPsl.

the Independent expert’s report (section 4.11) has been prepared by deloitte Corporate finance Pty limited (abn 19 003 833 127 afsl 241457).

the tGa valuation was prepared by Colliers International (section 4.9). the exhibition valuation was prepared by Cb richard ellis (section 4.10).

this explanatory Memorandum is dated 11 June 2010. It was lodged with asIC on 19 May 2010. neither asIC nor its officers takes any responsibility for the contents of this document. this explanatory Memorandum has also been lodged with asX. neither asX nor any of its officers takes any responsibility for the contents of this document.

Content Disclaimers

Investments in Cromwell Group are subject to investment and known and unknown risk, some of which are beyond the control of Cromwell Group, including possible delays in repayment and loss of income and capital invested. neither CCl nor CPsl nor their related entities guarantee any particular rate of return or the performance of Cromwell Group securities nor do they guarantee the repayment of capital invested or any particular tax treatment.

this explanatory Memorandum contains information relating to the past performance of Cromwell Group, including the trust. Past performance information is not a reliable indicator of future performance.

this explanatory Memorandum also includes certain statements that are forward looking. the words ‘anticipated’, ‘expected’, ‘projections’, ‘forecast’, ‘estimates’, ‘could’, ‘may’, ‘target’, ‘consider’ and ‘will’ and other similar expressions are intended to identify forward looking statements. those forward looking statements, opinions and estimates are not based on historical facts but rather reflect the assumptions, contingencies and expectations, as at the date of this document, of the CPsl directors with regard to future events and which are subject to change without notice. the statements are subject to risks and uncertainties not all of which can be known at this time and are based on assumptions which may prove to be incorrect in whole or in part. as a result, actual results could differ materially from the forward looking statements included in this document. forward looking statements including projections, indications or guidance on future earnings or financial position and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. to the full extent permitted by law, Cromwell Group and its directors, officers, employees, advisors, agents and intermediaries disclaim any obligation or undertaking to release any updates or revisions to the information to reflect any change in expectations or assumptions.

this explanatory Memorandum is not an offer or an invitation to acquire Cromwell Group stapled securities or any other financial products and is not a prospectus, product disclosure statement or other offering document under australian law or any other law. It is for information purposes only. you should consider the information included in this explanatory Memorandum before deciding how to vote in relation to the resolution.

2 EXPLANATORY MEMORANDUM

2. whAT shOULD i DO?

carefully read this Explanatory memorandum

Before you make a decision about how you will vote, you should read this Explanatory Memorandum carefully as it contains information relevant to your decision. You may also want to obtain legal, investment, tax or other advice before you vote on the resolutions. CPSL reserves the right to postpone, adjourn or cancel the meeting if there is a material change to any information in this document before the scheduled date for the securityholder meeting.

2.1 The Resolutions

PR The Placement Ratification (resolutions 1 and 3)

Resolution 1 or Resolution 3 will retrospectively approve the issue of stapled securities to Redefine Australian Investments Limited (“Redefine”) that occurred on 29 December 2009 (“the Placement Ratification”). This will refresh the Trust’s ability to issue up to 15% more stapled securities to one or more investors without having to get securityholder approval under ASX Listing Rule 7.1. Resolution 3 will only be considered by the meeting if Resolution 1 is not passed and Resolution 2 is passed.

PR The Constitution Amendment (resolutions 2)

Resolution 2 will amend the Trust constitution to simplify the voting requirements where future placements are being approved or ratified solely for the purposes of the Listing Rules (“the Constitution Amendment”). This will give the Group greater flexibility to manage any future capital raising.

AP The Acquisition Proposal (resolution 4)

Resolution 4 is to acquire two properties, a one-third interest in the Therapeutic Goods Administration Complex in Canberra (“TGA Property”) and 321 Exhibition Street in Melbourne (“Exhibition Property”), from the Cromwell-managed Cromwell Property Fund and undertake some related transactions (“the Acquisition Proposal”). Preconditions to the Acquisition Proposal being considered at the meeting are set out in Section 4.2.

NOTE: To make this Explanatory Memorandum easy to follow, small icons have been placed at the top of each page to identify whether it relates to the Placement Ratification and the Constitution Amendement ( PR ) or the Acquisition Proposal ( AP ).

2.2 Vote on the Resolutions

Subject to the voting exclusion statements and section 253E of the Corporations Act, all Cromwell Group securityholders are entitled to vote on the resolutions. The voting exclusion statements are in Sections 3.2.3 (Placement Ratification) and 4.3.3 (Acquisition Proposal).

In accordance with s253E of the Corporations Act, CPSL and its associates are not entitled to vote on any resolution of the Trust if they have an interest in the resolution other than as a member of the Trust.

As a securityholder, you can vote in one of the following ways:

a) by attending and voting at the meeting on 7 July 2010. The meeting will be held at Brisbane Auditorium, Level 5, Riverside Centre, 123 Eagle Street, Brisbane at 1.30pm.
b) by proxy, using the enclosed proxy form or by completing the form online at www.cromwell.com.au/registry Your completed proxy form will need to be lodged on-line or received by the Registry at its street or postal address or the registered office of CPSL by 1.30pm on 5 July 2010. If you are using the enclosed proxy form then, once you have completed and sign it, you can return it using the enclosed reply paid envelope, or you can fax it to 02 9287 0309. If you are signing under a power of attorney then a certified copy or original power attorney must be lodged at the same time.
If you vote by proxy you can still attend the meeting on 7 July 2010, but you will need to vote instead of your proxy.
c) by appointing a corporate representative or an attorney and having them vote at the meeting on 7 July on your behalf.
An original or certified copy of the representative appointment or power of attorney appointing your attorney will need to be received by the Registry or CPSL by 1.30pm on 5 July 2010 for the attorney to be able to vote on your behalf. You can use the enclosed reply paid envelope, you can fax it to 02 9287 0309. Corporate representatives or attorneys will need to bring proof of identity to the meeting.

2.3 Key Dates

2.3 Key Dates
Record Date – when eligibility to vote is determined	7.00pm, Monday 5 July 2010
When proxy forms or powers of attorney to vote at meeting need to be lodged	1.30pm, Monday 5 July 2010
meeting date	1.30pm, Wednesday 7 July 2010

EXPLANATORY MEMORANDUM

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sEcTiON 3. PLAcEMENT RATificATiON (resolutions 1 and 3) cONsTiTUTiON AMENDMENT (resolution 2)

EXPLANATORY MEMORANDUM

3.1 sUMMARY Of REsOLUTiONs 1, 2 & 3

3.1.1 About the Placement Ratification and Constitution Amendment

This section explains the Placement Ratification resolutions and Constitution Amendment resolution for unitholders in the Trust. Since Cromwell Group is a stapled security comprising the Trust and the Company, a similar resolution to the Placement Ratification is also being considered at the Company meeting. The Constitution Amendment only relates to the Trust constitution.

3.1.2 Strategic Rationale

a) placement

A placement of 104,750,000 stapled securities was made to Redefine Australian Investments Limited (“Redefine”) on 29 December 2009 (“the Placement”).

The Placement was undertaken at $0.70 per security which represented a 5.4% discount to the closing share price on 23 December 2009, a 7.19% discount to the volume weighted average price (VWAP) over the previous 30 days and was equivalent to the VWAP over the previous 90 days. The Group was able to avoid the need to raise capital at a significant discount to NTA through the downturn, contrary to many of its peers.

The Placement resulted in Redefine owning approximately 13% of the issued capital of the Group.

Redefine intends to maintain its holding in the Group and has agreed not to dispose of the stapled securities issued under the Placement for 12 months, subject to certain exceptions.

In January 2010, the Group appointed Mr Marc Wainer, a director of Redefine, to the Boards of CCL and CPSL.

Funds from the Placement boosted the Group’s available cash, and provided the Group with flexibility in relation to capital management.

b) Ratification

ASX Listing Rule 7.1 effectively means that Cromwell Group cannot issue more than 15% of its capital in any 12 month period without securityholder approval (see Section 3.2.1).

Therefore, the Placement to Redefine in December 2009 reduces Cromwell Group’s capacity to issue additional capital before 29 December 2010 and, in doing so, limits its ability to continue to effectively manage its capital requirements in an expeditious manner. This could in turn adversely impact the Group’s ability to take advantage of future opportunities that may arise in the current market conditions.

The Group has, and continues to, actively seek transactions which improve the overall quality of the Group’s property portfolio, earnings and growth prospects.

As an essential component of its capital management strategy, Cromwell Group wishes to maintain its capacity to issue up to 15% of its capital in a 12 month period notwithstanding the Placement.

The Group is accordingly seeking to refresh its 15% capital raising capacity by obtaining subsequent approval for the Placement from securityholders.

The passing of the Placement Ratification (that is, the passing of either Resolution 1 or 3) in the Notice of Meeting will refresh the capital raising capacity for the Trust only. A meeting of CCL shareholders has also been called to refresh the capital raising capacity for CCL. Given that the units in the Trust and the ordinary shares in CCL are stapled together, and therefore units and shares can only be issued as part of Cromwell Group securities, the Group’s capital raising capacity will only be effectively refreshed when approval is given at meetings of both holders of Trust units and holders of ordinary shares in CCL.

The introduction of Redefine as a long-term cornerstone investor is expected to benefit the Group beyond the immediate impact of the Placement. The strategic alliance gives the Group a potential source of additional equity funding in the future to pursue opportunities that may emerge in the market.

The Placement was advised to the market at the time of issue and did not fall within the exceptions in ASX Listing Rule 7.2.

EXPLANATORY MEMORANDUM 5

3.1 sUMMARY Of REsOLUTiONs 1, 2 & 3 cONTiNUED

3.1.3 Investment Strategy

The Group aims to provide solid, reliable earnings to investors from recurring property and funds management income.

The Group primarily invests in property including commercial, industrial and retail property. It can also invest in entities (whether listed or unlisted) which primarily hold property assets. Such entities may include managed investment schemes promoted and managed by CPSL or other managers. The Group may also hold cash or Australian fixed interest assets or other authorised investments to maximise returns consistent with moderate risk on surplus cash accumulated from time to time. Assets may be sold at any time CPSL considers it commercially viable and the proceeds of sale may be reinvested.

CPSL considers acquisition opportunities on an ongoing basis as and when they arise. If, before the securityholder meeting, an opportunity to acquire an attractive asset that will assist the Group meet its strategy arises, then an ASX announcement will be made if required.

3.1.4 The Constitution Amendment and the Placement Ratification alternatives

Securityholders will have noticed that there are three Resolutions proposed in relation to the ratification of the Placement to Redefine.

As explained in Section 3.2.1, under the Listing Rules the Placement to Redefine needs to be ratified by securityholders if Cromwell is to maintain its capacity to issue up to 15% of its capital before 29 December 2010.

The Trust’s constitution currently says that, if an issue of securities is to be approved or ratified by securityholders for the purposes of the ASIC Class Order or the Listing Rules, then a ‘placement resolution’ is required. A ‘placement resolution’ means that at least 25% of securityholders by value need to vote at the meeting on the resolution and, of them, at least 75% need to vote in favour of it for it to be approved.

Resolution 2 amends the constitution so that a ‘placement resolution’ is only required if the issue of securities needs to be approved or ratified for the purposes of the ASIC Class Order (see Section 3.2.2.1). The supplemental deed amending the Trust constitution is included in this Explanatory Memorandum at Section 5.2.7.

Notwithstanding the amendment to the constitution, the Listing Rules will still require securityholders to approve or ratify any issue of securities in excess of 15% of the Group’s capital in any 12 month period. The amendment will mean that the approval or ratification for the purposes of the Listing Rules will occur if a simple majority of unitholders in the Trust vote in favour of it, without the 25% voting threshold.

‘Placement resolutions’ are not required by, or referred to in, the Listing Rules and are only required for the purposes of the particular ASIC Class Order. As a result, Cromwell believes that it is appropriate that the constitution be amended to only require that a particular issue of securities be approved or ratified by way of a ‘placement resolution’ where the approval or ratification is required for the purposes of the ASIC Class Order.

Cromwell does not need to have the Placement to Redefine ratified for the purposes of the ASIC Class Order but does need to have it ratified for the purposes of the Listing Rules. Therefore, if Resolution 1 is not passed but Resolution 2 is passed and the constitution is amended as discussed above, securityholders will be asked to consider Resolution 3. Resolution 3 is identical to Resolution 1 except it is not put to the meeting as a ‘placement resolution’ (in other words, because of the constitution amendment, it is not subject to the 25% voting threshold and can be passed by a simple majority of securityholders voting in favour of it). Resolution 3 will not be considered by the meeting if Resolution 2 is not passed.

This is why Resolution 1 is said to be a ‘placement resolution’.

However, the Group has a large number of small investors. As a result, there is some uncertainty as to whether 25% of securityholders by value will vote and whether Resolution 1 will be effective. This is a risk given the strategic importance to the Group of maintaining its ability to undertake capital raising during this calendar year.

6 EXPLANATORY MEMORANDUM

3.2 LEgAL & REgULATORY REqUiREMENTs

3.2.1 ASX Listing Rules 7.1 and 7.4

Listing Rule 7.1 has the effect that, unless one of the exceptions in Listing Rule 7.2 applies, the Group must not, without the approval of securityholders, issue stapled securities in excess of:

| 15% of the total of the number of stapled securities on issue 12 months before the date of issue plus the number of stapled securities issued in accordance with an exception in Listing Rule 7.2 or with the approval of holders of stapled securities; less
| the number of stapled securities issued other than in accordance with such an exception or approval.

The Placement has therefore reduced the Group’s capacity to issue stapled securities within the 15% limit prescribed by Listing Rule 7.1.

Listing Rule 7.4 provides that an issue of securities made without approval under Listing Rule 7.1, or which does not fall within one of the exceptions detailed in ASX Listing Rule 7.2, is treated as having been made with approval for the purpose of ASX Listing Rule 7.1, if each of the following applies:

| the issue did not breach ASX Listing Rule 7.1; and
| holders of ordinary securities subsequently approve the issue.

The resolution that unitholders are being asked to pass is proposed to comply with Listing Rule 7.4.

The issue that unitholders are being asked to approve did not breach Listing Rule 7.1. Pursuant to Listing Rule 7.1, the Group had, over the past 12 months, the capacity to issue up to 104,862,740 stapled securities without securityholder approval. The issue to be approved was 104,750,000 stapled securities (as detailed below), leaving the Group with the capacity to issue a further 112,740 stapled securities pursuant to ASX Listing Rule 7.1.

3.2.2 Information required under Listing Rule 7.5

ASX Listing Rule 7.5 specifies certain additional information that must be provided in order for holders of ordinary securities to subsequently approve the issues for the purposes of Listing Rule 7.4.

The additional information required in relation to the capital placement is as follows:

a) Number of units allotted as a component of stapled securities (being the number of stapled securities allotted):
104,750,000.
b) Price at which the stapled securities were issued: $0.70 per stapled security.
c) The terms of the stapled securities:

The stapled securities were issued on the same terms as existing Cromwell Group stapled securities. The stapled securities ranked for and were entitled to distributions from Cromwell Group for the period 1 October 2009 to 31 December 2009 pro rata to the number of days in the period of 1 October 2009 to 31 December 2009 in which the stapled securities were on issue.

d) The name of the allottee:

Redefine Australian Investments Limited (“Redefine”). Redefine is a company that is registered in Ireland and is ultimately a fully owned subsidiary of Ciref Plc (LSE: CRF), a company registered in Jersey and listed on the AIM of the London Stock Exchange with a market capitalisation at 14 May 2010 of approximately AUD$216 million. Ciref Plc currently has investments in a range of fixed and listed property assets located within Australia, the UK, Europe, the Channel Islands and the British Virgin Islands. As at May 2010, Redefine Properties Limited (formerly Redefine Income Fund Limited) (JSE: RDF), a real estate investment trust listed on the Johannesberg Stock Exchange with a market capitalisation at 14 May 2010 of approximately AUD$2.9 billion, held an interest of approximately 70.66% in Ciref Plc.

e) The use (or intended use) of the funds raised: The purpose of the funds raised was to boost the cash resources of the Group to provide increased flexibility in relation to capital management and to enable the Group to consider further strategic acquisitions.

EXPLANATORY MEMORANDUM 7

3.2 LEgAL & REgULATORY REqUiREMENTs cONTiNUED

3.2.2.1 asIc class order 05/26

Cromwell Group includes the Trust, a registered managed investment scheme, and units in the Trust are a component of each Cromwell Group stapled security.

The price at which units in the Trust can be issued must normally be objectively verifiable by reference to the Trust’s constitution and not extraneous factors such as the exercise of CPSL’s discretion.

The Class Order modifies this rule in a number of limited cases. One of these cases is a placement of units, including units comprising a component security of a stapled security, that are quoted on the ASX.

The Class Order accommodates placements either with or without the approval of a resolution of stapled securityholders.

A placement without securityholders’ approval may be made on the following conditions:

the securities are not issued to:
a. the responsible entity; or
b. an associate of the responsible entity except pursuant to two narrow exceptions relating to underwriting arrangements and acquisitions in a fiduciary capacity; and

3.2.2.2 placement resolution

Resolution 1 is proposed as a ‘placement resolution’. Accordingly,

it is proposed as a special resolution;
a.
b. votes may only be cast on the resolution in respect of securities (“Eligible Securities”):
i. that are held by a securityholder that did not acquire any of the securities issued; or
ii. that are held by a securityholder for the benefit of another person who did not obtain beneficial ownership of the securities issued; and
c. the value of the Eligible Securities held by the securityholders who vote represents at least 25% of the total value of Eligible Securities.

If any of these conditions are not satisfied, Resolution 1 (“Placement Ratification”) will not constitute a placement resolution and therefore will be of no effect for the purposes of the Class Order or the Listing Rules. However, if Resolution 2 is passed, the meeting will consider Resolution 3, which will not need to be a placement resolution to be effective for the purposes of the Listing Rules.

the issue, together with any ‘related issue’ in the previous year does not, immediately before the issue, comprise more than 15% of securities.

A ‘related issue’ includes the Placement to Redefine, and so the capacity of CPSL to issue the Trust units within the 15% limit prescribed by the Class Order has been commensurably reduced by that issue.

A ‘related issue’ would not however include the Placement to Redefine if it were ratified by securityholders in accordance with a provision of the Trust constitution that satisfies the requirements of the Class Order. The relevant provisions have been included in the Trust’s constitution and currently require, amongst other things:

a. the ratification to be by way of ‘placement resolution’; and
b. the notice of meeting to contain particulars of the use made of the money raised by the issues.

Funds raised by the issue are currently held by the Group as cash. Funds were raised for the use set out in Section 3.2.2 (c). Part of the funds raised are intended to be used to fund the cash component of the Acquisition Proposal.

Resolution 2 will amend the Trust’s constitution so that the relevant provisions discussed above only apply if a placement is being approved or ratified for the purposes of the Class Order. At present they apply for the purposes of the Class Order and the Listing Rules.

8 EXPLANATORY MEMORANDUM

3.2.3 Voting exclusion statement

The following disclosures are made to comply with Listing Rule 7.5.6.

CPSL will disregard any votes cast on Resolutions 1 or 3 by:

| Redefine, being the person who participated in the issue; and
| an associate (as defined in sections 11 and 13-17 of the Corporations Act) of that person.

However, CPSL need not disregard a vote (for the purposes of this statement) if:

| it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; and
| it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

Note the qualifications in the previous paragraph to the voting exclusion only apply for the purpose of the voting exclusion included for the purposes of Listing Rule 7.5.6. They do not apply to the voting exclusion that applies as a result of Resolution 1 being proposed as a ‘placement resolution’ for the purposes of the Class Order.

3.2.4 Other information

No other units or Cromwell Group stapled securities other than those detailed in this Explanatory Memorandum were issued during the previous 12 months.

3.2.5 Approval sought

Securityholders are requested to subsequently approve and ratify the issue of 104,750,000 units that were issued as a component of the 104,750,000 stapled securities that were issued to Redefine at an issue price of $0.70 per stapled security.

Approval and ratification will be given by eligible securityholders passing Resolution 1 or 3 (“Placement Ratification”) in the Notice of Meeting. Securityholders will only be asked to pass Resolution 3 if Resolution 1 is not approved, but Resolution 2 is passed. Securityholders are requested to approve the amendment to the Trust’s constitution set out in the supplemental deed in Section 5.2.7. Approval will be given by eligible securityholders passing Resolution 2 (“the Constitution Amendment”) in the Notice of Meeting.

EXPLANATORY MEMORANDUM 9

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sEcTiON 4. AcqUisiTiON PROPOsAL (resolution 4)

10 EXPLANATORY MEMORANDUM

4.1 sUMMARY Of REsOLUTiON 4

4.1.1 About the Acquisition Proposal

What does the acquisition proposal involve?

The Trust will acquire the one-third interest in the TGA Property it does not already own as well as 100% of the Exhibition Property from the Cromwell Property Fund (CPF).

CPSL is the responsible entity of both the Trust and CPF. Therefore, the Trust and CPF are related parties for the purpose of the Corporations Act and the Acquisition Proposal is a related party transaction.

The Acquisition Proposal requires securityholder approval under ASX Listing Rule 10.1 because the purchase of the Properties is deemed to be an acquisition of a substantial asset and it is a related party transaction.

The one-third interest in the TGA Property will be acquired for $25 million, which reflects the TGA Property’s independent valuation. CPF holds its interest in the TGA Property through some wholly owned sub-trusts. Therefore, the Trust will acquire the one-third interest in the TGA Property and certain incidental assets and liabilities by acquiring those units.

The Trust will pay for the one-third interest in the TGA Property by making a cash payment to CPF of approximately $12 million and by taking over the existing CPF debt with an external financier of approximately $13 million.

The Exhibition Property will be acquired for a price equivalent to its independent valuation of $90.2 million. The Trust will pay for the Exhibition Property by making a cash payment to CPF of $80 million and by reducing an existing loan to CPF from the Trust by $10.2 million. The $80 million cash payment will be funded by the Trust entering into a new 3 year debt facility with an external financier for approximately $80 million. The external financier is the existing financier of the Exhibition Property for CPF. It is currently anticipated that the interest rate for the new debt facility will be between 6.7% and 7.4%, which would result in monthly repayments of between approximately $447,000 - $493,000.

The Trust will also agree to amend the terms of its existing loan to CPF by extending the expiry date to June 2012 in exchange for an increase in the interest rate to be equal to that of the primary external finance facility held by CPF which is currently being re-negotiated.

==> picture [210 x 240] intentionally omitted <==

tGa Property (details in section 4.5)

==> picture [210 x 239] intentionally omitted <==

exhibition Property (details in section 4.4)

EXPLANATORY MEMORANDUM 11

4.2 fREqUENTLY AskED qUEsTiONs

Why is the cromwell property Fund selling the properties?

CPSL, in its capacity as responsible entity of CPF, recently undertook a strategic review of the Cromwell managed, unlisted CPF. As at the date of this document, the Trust is the largest investor in CPF, holding approximately 18% of the units on issue (valued at approximately $7 million) and has loans receivable from CPF of approximately $30 million.

The strategic review focussed on two main issues impacting CPF:

| the high gearing level of approximately 87% which has occurred primarily due to falls in property valuations. This level of gearing needs be reduced in order to avoid action being taken by CPF’s main financier and to enable an extension to CPF’s existing core finance facility which expires in March 2011; and
| the largest asset of CPF (Exhibition Property) became vacant on 1 March 2010 and requires expenditure of approximately $25 million in order to refurbish the property to an acceptable standard to attract quality tenants plus an additional amount, which could be significant, to cover holding and other related costs and to incentivise those tenants to enter into leases over the property. CPF is not currently in a financial position to undertake the refurbishment or make the necessary incentive payments.

The strategic review determined that the best way forward for CPF was to sell assets to reduce gearing and, in particular, to sell the Exhibition Property so as to avoid the need to raise funds to meet the refurbishment costs and make the necessary lease incentive payments.

What are the pre-conditions to the acquisition proposal being considered at the meeting?

CPSL reserves the right to postpone or stop the Acquisition Proposal at any time before the scheduled meeting date if either:

| there is a material change to any information in this document (including the directors being of the view that the Acquisition Proposal is no longer in the best interests of investors); or

How will the acquisition proposal be funded?

The Trust will pay for the Exhibition Property by making a cash payment to CPF of approximately $80 million. The cash will be available to the Trust under a new 3 year debt facility with an external financier for approximately $80 million. The Trust will also reduce an existing loan to CPF from the Trust by $10.2 million. The external financier is the existing financier of the Exhibition Property for CPF.

The refurbishment and tenancy costs for the Exhibition Property will be met out of available cash resources.

CPF and the Trust will pay their own costs and expenses related to the Acquisition Proposal and its implementation (including stamp duty) if approved.

For further information see Section 4.7.

How was the price that cromwell Group is to pay for the Exhibition property and the interest in the tGa property determined?

Independent valuation reports were sought on both properties from registered valuers and the purchase price was determined having regard to those independent valuations and the current market.

The TGA Property was valued by Colliers International in March 2010. The valuation valued the TGA Property at $75 million. Based on that valuation, the purchase price of $25 million for a one-third interest was agreed.

The Exhibition Property was valued by CB Richard Ellis in March 2010 at $90.2 million. Although the valuation was undertaken at a time when the building was vacant and in need of refurbishment it does assume that the refurbishment will occur and that the building will be gradually let up after that.

| CPSL has not agreed terms with external financiers for the Trust.

12 EXPLANATORY MEMORANDUM

What financial benefits is the trust paying to its related party, cpF?

Since the Acquisition Proposal is a related party transaction, section 219 of the Corporations Act requires that we outline the financial benefits that the Trust is providing to CPF as a result of the transaction.

If the Acquisition Proposal is approved, the Trust will provide the following financial benefits to CPF:

A cash payment of approximately $92 million;
Taking on the obligations to make interest and capital repayments (as well as other obligations) under the existing CPF debt with an external financier in relation to the TGA Property;
Reducing the existing loan the Trust has made to CPF by $10.2 million, which in turn reduces the amount of capital and interest CPF would otherwise pay to the Trust; and
Extending the expiry date of the existing loan the Trust has made to CPF thereby giving CPF longer to make the remaining capital and interest payments than is currently the case.

The arrangements the Trust and CPF have entered into with regard the refurbishment are outlined under the heading “What is happening with the refurbishment?” below.

As a result of those arrangements, if securityholders vote in favour of the Acquisition Proposal, the Trust will be foregoing a financial benefit because, although the Trust will own the Exhibition Property and the refurbishment costs are expected to have a positive impact on the value of the Exhibition Property, the Trust will not be reimbursed for its payments in relation to the refurbishment works nor will it have the benefit of ongoing interest payments under the loan to CPF for the refurbishment works.

How long will the Exhibition property be vacant?

CPF has signed a non-binding heads of agreement to lease, with an ASX top 20 company (“the Potential Tenant”), for the majority of the Exhibition Property. The proposed terms of the future lease are substantially similar to the terms assumed by the Exhibition Property Valuer. CPF is also in discussions with other potential tenants for the remaining vacancies in the building.

A binding agreement to lease is currently being negotiated and may be concluded before the date of the meeting.

Amongst other things, before the heads of agreement can become a binding agreement it needs to be approved by the board of the Potential Tenant and the owner of the Exhibition Property at the time has to agree to the incentive payments proposed.

An agreement to lease, rather than a lease, is necessary because a lease cannot begin until a refurbishment of the Exhibition Property is completed.

What is happening with the refurbishment?

To meet the Potential Tenant’s timeframe, and to ensure the Exhibition Property can be fully leased as quickly as possible, the refurbishment works have already begun. At present the Trust has entered into the relevant contracts and has agreed to fund the refurbishment regardless of whether the Acquisition Proposal is approved. This was necessary to best preserve the value of the Exhibition Property for the Trust as a potential purchaser. However, if securityholders do not approve the Acquisition Proposal, any amounts paid, or to be paid, in relation to the refurbishment works will become the subject of a loan from the Trust to CPF at commercial rates for a loan of this type.

To date only incidental payments have been necessary for the refurbishment works. In July 2010, a payment of $360,000 is expected to be claimed. In August 2010, a payment claim of $1,450,000 is expected, with $2,800,000 being expected in September 2010. Payment claims are then expected to increase over the next 2-3 months before then decreasing towards the end of the contract.

EXPLANATORY MEMORANDUM 13

4.2 fREqUENTLY AskED qUEsTiONs cONTiNUED

What are the key terms of the loans utilised to acquire the properties?

Existing TGA Loan	Existing TGA Loan
Borrower	CPsl as responsible entity for CPF#3 trust1
Facility	$12,940,000
Facility term	to 31 March 2011
Purpose	to fund the acquisition of one-third of the tGa Property
security	a) registered Charge over the Borrower and Custodian specifc to the one-third interest in the tGa Property and cashfow of the tGa Property.
	b)registered Mortgage over the tGa Property.
loan to value ratio	not more than 65%
covenant
interest cover ratio	not less than 1.5 times

The details above relate to the one-third of the existing facility expected to be assigned to a subsidiary of the Trust. The balance two-thirds of the facility which is held on similar terms is already in place for the Trust.

New Exhibition	Loan
Borrower	trust Company limited as custodian for the eXM trust2
Facility	$80,000,000
Facility term	3 years from date of fnancial close
Purpose	Provide senior debt funding to acquire the exhibition
	Property
security	a) registered Mortgage debenture by Borrower specifc to the exhibition Property and cashfow of the
	exhibition Property.
	b) registered Mortgage over the exhibition Property.
	c) any other security documentation required by the
	Bank as directed bythe Banks legalpanel.
loan to value ratio	not more than 60%
covenant
interest cover ratio	not less than 1.3 times
interest rate	Currently expected to be between 6.7% and 7.4%
interest Payments	Currently expected to be made monthly and be between
	$447,000 - $493,000

[1] a wholly owned sub-trust of CPf, which holds its one-third interest in the tGa Property.

[2] a wholly owned sub-trust of dPt, which will hold the exhibiton Property if the acquisition Proposal proceeds.

What are the key terms of the trust’s existing loan to cpF?

ExistingCPF Loan	ExistingCPF Loan
Borrower	CPsl as responsible entityof CPF
Facility	$30,000,000
Facilityterm	to 30 June 2010
Purpose	to facilitate with the acquisition of investmentproperties
security	unsecured and ranks behind secured facilities
loan to value covenant	n/a
interest cover ratio	n/a

are there any other loans between cromwell Group and cpF?

There is a further loan to CPF of $11 million from Cromwell PacLib Nominees Pty Ltd, a wholly owned subsidiary of Cromwell Group. The terms of this loan are not affected by the Acquisition Proposal.

What will the level of gearing of cromwell Group be if the acquisition proposal is completed?

If the Acquisition Proposal is completed the Group’s total liabilities will increase from $719 million to $812 million. This is because the Trust is entering into a new $80 million debt facility for the Exhibition Property and is taking over a $13 million debt facility from CPF in relation to the TGA property.

The Group’s gearing (net debt: total assets less cash) will increase from 47% to 54% as the Properties will be geared at a higher level than the Group’s existing properties.

The loan to value ratio (total debt: total property) will reduce from 59% to 58% because existing cash resources are being used to fund the refurbishment of Exhibition Property, which will improve its capital value which is relevant when determining this ratio.

What impact will the acquisition proposal have on the earnings of cromwell Group?

The Acquisition Proposal is expected to be slightly accretive to operating earnings per security, increasing forecast earnings per security for the 2011 financial year by 0.1 cents and for the 2012 financial year by 0.6 cents. These forecasts are subject to the risks and assumptions set out in Section 4.7 and may vary considerably.

What impact does the acquisition have on the value of the Group?

The Acquisition Proposal is expected to have no immediate impact on NTA per security, although changes in the value of the Properties in the future may impact NTA.

For example, the Properties will be valued at approximately $115.2 million at acquisition (if approved). If they increase in value by 1% then they would be valued at approximately $116.35 million or, if they decreased in value by 1% they would be valued at approximately $114 million. The current NTA per security would also increase or decrease by 0.14 cents.

The value of Cromwell Group stapled securities on the ASX is determined by market forces and the impact of the Acquisition Proposal on this cannot be accurately predicted.

14 EXPLANATORY MEMORANDUM

Will my distributions be affected?

The Acquisition Proposal is forecast to not have any impact on distributions. Full financial analysis of the Acquisition Proposal is included in Section 4.7.

How will the acquisition proposal impact the cromwell Group property portfolio?

Details of the impact are set out in Section 4.6.

What vote is required for the acquisition proposal to proceed?

Under ASX Listing Rule 10.1 Cromwell Group securityholders are required to vote on the transaction as the Group is acquiring assets of a value greater than 5% of the Cromwell Group’s equity interests from a related party. In addition, securityholders are required to approve the Acquisition Proposal under the Corporations Act, which regulates the giving of financial benefits to a related party. The vote is an ordinary resolution which means that, to be passed, at least 50% of the votes cast by unitholders in the Trust must be in favour of the Acquisition Proposal.

What happens if the acquisition proposal doesn’t proceed?

If the Acquisition Proposal is not approved, (or the preconditions are not met - see earlier in this Section), then the interest in the Properties will not be acquired. In this case, the Trust will still consider extending the term of its existing loan. Further, the Trust will continue to fund the refurbishment of the Exhibition Property under the loan agreement outlined under the heading “What is happening with the refurbishment?” on page 13. It is likely also that the Exhibition Property will need to be sold by CPF. The Trust’s loan for the refurbishment would be repaid out of sale proceeds after the existing financier is repaid.

What else could the trust do instead of the acquisition proposal?

As outlined in Section 4.7, the Trust is utilising approximately $79 million of available cash to undertake the Acquisition Proposal. Although the Acquisition Proposal does not stop the Group from undertaking other transactions, in utilising this cash, the Group will lose some flexibility in structuring future transactions. However the Group is still able to undertake capital management initiatives to facilitate other transactions including capital issues, sales of non-core assets and recommencement of the distribution reinvestment plan.

How did cromwell ensure that the interests of both cromwell Group securityholders and cpF unitholders were regarded?

CPSL is the responsible entity of both the Trust and CPF. As such it must act in the best interests of both groups of investors and cannot favour one group of investors over the other.

To assist with its consideration of the Acquisition Proposal the Board divided into two Investment Committees. One Investment Committee considered the Acquisition Proposal from the point of view of CPF and the other considered it from the point of view of the Trust. A formal, robust process was adopted and followed by the two Investment Committees. This involved considering both the advantages and disadvantages of the Proposal for each group of investors as well as overseeing the negotiation of the relevant transaction documents. Each Investment Committee then made a recommendation about the Acquisition Proposal to the full board of CPSL.

The Board then considered the advantages and disadvantages of the Acquisition Proposal for both the Trust and CPF and in both cases determined that the Acquisition Proposal was in the best interests of investors.

What does the Board recommend?

The Board of CPSL has carefully considered the Acquisition Proposal and recommends that securityholders vote in favour of it. See Section 5.1.

What is the opinion of the Independent Expert?

The Independent Expert, Deloitte Corporate Finance Pty Limited, has considered the Acquisition Proposal and is of the opinion that, “the Acquisition Proposal is fair and reasonable”.

The Independent Expert’s Report can be found at Section 4.11.

Do I have to vote?

You do not have to vote. However your vote is important and provides you with a chance to have your say on whether the Acquisition Proposal should proceed.

How can I get further information on the material contained in this Explanatory memorandum?

If you have any questions in relation to the Acquisition Proposal please contact your financial advisor, broker or our information line within Australia on 1800 334 533 or outside Australia +61 7 3225 7777.

EXPLANATORY MEMORANDUM 15

4.3 LEgAL & REgULATORY REqUiREMENTs

4.3.1 Listing Rule 10.1

Listing Rule 10.1 has the effect that, unless one of the exceptions in Listing Rule 10.3 applies, the Trust as a component entity of Cromwell Group (or any of its subtruts or subsidiaries) must not acquire a substantial asset from, or dispose of a substantial asset to, specified persons or companies without the approval of securityholders.

An asset is treated as a substantial asset if its value or the value of the consideration for it, is 5% or more of Cromwell Group’s equity interests as set out in the latest financial statements given to ASX. Cromwell Group’s equity interests is the sum of paid up capital, reserves, and accumulated profits or losses, disregarding redeemable preference share capital and outside equity interests.

The specified persons or companies to whom Listing Rule 10.1 applies include:

(a) a related party of CPSL;
(b) a subsidiary of CPSL;
(c) a substantial holder in the Group who either alone or together with its associates has a relevant interest, or had a relevant interest at any time in the six months before the transaction, in at least 10% of the total votes attached to the stapled securities;
(d) an associate of a person or company referred to in paragraphs (a), (b) or (c); or
(e) a person or company whose relationship with CPSL or a person or company referred to in paragraphs (a) to (d) is such that, in ASX’s opinion, the transaction should be approved by securityholders.

The Trust is paying a price for the Exhibition Property and the one-third interest in the TGA Property which exceeds 5% of Cromwell Group’s equity interests.

Since CPSL is the responsible entity of CPF and the Trust, CPF is a related party of the Trust.

Accordingly, securityholders are being asked to pass Resolution 2 to comply with Listing Rule 10.1.

4.3.2 Chapter 2E, as modified by Part 5C.7

Chapter 2E, as modified by Part 5C.7, regulates the giving of financial benefits out by DPT to CPSL or a related party and has the effect that, unless one of the exceptions in Chapter 2E applies, CPSL must not give a financial benefit out of DPT to CPSL or a related party without the approval of securityholders. The financial benefits must be given within 15 months after the approval of securityholders.

By entering into, and completing, the Acquisition Proposal, DPT is giving financial benefits to a related party, CPF.

Accordingly, securityholders are being asked to pass Resolution 2 (Acquisition Proposal) to comply with Chapter 2E of the Corporations Act, as modified by Part 5C.7.

4.3.3 Voting exclusion statement

The following disclosures are made to comply with Listing Rule 10.10.1.

CPSL will disregard any votes cast on Resolution 2 by:

| CPSL, being the person who is a party to the transaction; and
| an associate (as defined in sections 11 and 13-17 of the Corporations Act) of CPSL.

However, CPSL need not disregard a vote (for the purposes of this statement) if:

| it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
| it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

4.3.4 Independent expert’s report

Under ASX Listing Rule 10.10.2, securityholders must be given an independent report by an independent expert. The report must state whether the Acquisition Proposal is fair and reasonable to securityholders (except those who are precluded from voting at the meeting).

What is fair and reasonable must be judged by the independent expert in all the circumstances of the Acquisition Proposal. This requires taking into account the likely advantages to securityholders if the Acquisition Proposal is approved and comparing them with the disadvantages to them if the Acquisition Proposal is not approved.

On the basis of the matters discussed in its report, Deloitte Corporate Finance Pty Limited has formed the opinion that the Acquisition Proposal is fair and reasonable to securityholders (except those who are precluded from voting at the meeting).

Securityholders should read the Independent Expert’s Report in full. The report is part of this Explanatory Memorandum.

4.3.5 Approval sought

Securityholders are requested to approve the acquisition by the Trust from CPF of the Exhibition Property and the one-third interest in the TGA Property, as outlined in this Explanatory Memorandum.

Approval will be given by eligible securityholders passing Resolution 2 (Acquisition Proposal) in the Notice of Meeting.

16 EXPLANATORY MEMORANDUM

4.4 EXhibiTiON PROPERTY

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PropertyDetails
address	321 exhibition street,Melbourne ViC 3000
sector	Commercial
land area	2,914 sqm
lettable area	30,995 sqm
external valuation	$90.2 million(31 March 2010)
occupancy	Currentlyvacant
Caprate	8.00%

4.4.1 Asset Summary

The Exhibition Property is a 20 storey building located on the corner of LaTrobe and Exhibition Streets in the Melbourne CBD. The building has a net lettable area of approximately 30,975 sqm and has recently been vacated by major tenant Australia Post Corporation.

A non-binding heads of agreement to lease has been signed with an ASX top 20 company for the majority of the building. The proposed terms of the lease are substantially similar to the terms assumed by the Exhibition Property Valuer. Advanced negotiations are also in place with prospective tenants for the balance of the building.

The Exhibition Property was constructed by Multiplex and completed in 1990. The building has a single level basement car park above a ground level entrance foyer and lift lobby along with 18 upper levels of office accommodation (levels 10 & 11 are plant room). Retail tenancies are available along LaTrobe and Exhibition Streets. In total 11 lifts service the floors separated into two banks of 5 passenger lifts servicing the low rise (levels 1 to 9) and the high rise (levels 12 to 20) plus one dedicated goods lift servicing all levels. All of the floors enjoy excellent natural light and spectacular views over Melbourne CBD and Carlton Gardens.

4.4.2 Refurbishment

Approximately $32 million (including approximately $7 million in interest and holding costs) is to be spent in order to refurbish the property to an acceptable standard to attract quality tenants and cover holding and other related costs. Further details on the anticipated refurbishment costs are set out under the heading “Property Acquisition, Refurbishment & Leasing” in Section 4.7.5.

Refurbishment has recently commenced. Once the works are complete, the Exhibition Property will meet PCA A Grade standards and is designed to achieve a 5 Star Green Star version 3 rating and a 4.5 Star Nabers Energy rating.

Refurbishment works include:

| The lobby will get a complete refit and be expanded to include a café, waiting lounge and meeting area;
| The existing thick cross mullion external glass façade along LaTrobe and Exhibition Streets will be replaced with a new glass façade allowing more natural light;
| The existing plant and equipment will be significantly upgraded and in some instances replaced to improve efficiency. The works will include replacement of cooling towers and ugrading of the chiller plant and Building Management System (BMS). All upper floors will be refurbished to an ‘as new’ condition and feature 360 degree double glazed facades providing excellent natural light across the floor plate and a high level of thermal efficiency;
| Upgraded amenities will include new dual flush toilets, water efficient taps and waterless urinals. All wall, ceiling and floor finishes will be replaced with modern finishes;
| New efficient T5 lighting controlled in multiple zones will be installed on each floor to maximise efficiency; and
| Shower facilities, lockers, over 200 bike racks and a comingled recycling and waste facility will be installed in the basement.

EXPLANATORY MEMORANDUM 17

4.4 EXhibiTiON PROPERTY cONTiNUED

Green Building Fund & EsD Initiatives

In line with CPSL’s commitment to continue to improve the environmental efficiency of the Trust portfolio, the refurbishment project will exceed the Commonwealth Energy Efficiency in Government Operations Policy.

The Green Building Fund aims to reduce the impact of Australia’s Built Environment on green house gas emissions by reducing the energy consumed in the operation of commercial office buildings. The program targets existing commercial office buildings by providing an incentive to reduce the energy consumption in these buildings.

The Exhibition Property refurbishment project will be monitored and reported by the various project team consultants in consultation with the Green Building Fund, which is overseen by AusIndustry staff members. The Green Building Fund was an open submission process and being selected to take part in this study reinforces the unique and innovative nature of the refurbishment works.

The Green Building Fund selection further endorses the high refurbishment standards the building will achieve and the excellent work undertaken by the experienced refurbishment project team, which includes Project Manager Montlaur Project Services, Architects GrayPuksand, Mechanical & Services Consultant Steensen Varming and Environmentally Sustainable Design Consultant SBE.

A summary of the Environmentally Sustainable Design (ESD) initiatives are:

| Installation of co-generation power plant
| Waste heat from the co-generation plant used to heat domestic hot water and chilled water via an absorption chiller
| Environmentally sustainable design criteria used in the selection of all materials to be used
| Eliminate use of Volatile Organic Compounds (VOC)
| Provision of rain water harvesting
| Introduction of solar water heating systems
| Individual tenancy and base building monitoring equipment
| T5 lighting on all tenant floors with multiple control zones
| Water efficient sanitary fittings in all bathrooms, showers and tea rooms
| Over 200 bike racks in basement
| 22 showers and associated lockers facilities.

4.4.3 Market Summary

The global financial crisis has had a significant effect on the Melbourne CBD office market with a decrease in capital values of 17% from the peak in Q4 2007 to its trough in Q3 2009[1] . However, the sector has outperformed other markets such as Sydney that were more exposed to the deteriorating financial sector. Limited supply brought on by the global financial crisis has led to forecast growth in rentals in 2011 and 2012 as Melbourne emerges as an undersupplied office market.

One of the major benefits of the strong economy over the last decade has been low office vacancy rates. The economic downturn was expected to lead to higher vacancy rates within the Melbourne office market than that which has prevailed. Melbourne office market vacancy rates are now considered to have peaked at 6.6%, up from 4.8% in September 2009[1] . The Property Council of Australia reports there was a total of 101,894 square metres of net supply added to the CBD market in the six months to January 2010. Most of this supply was subject to high levels of pre-commitment, but underlying instability in the financial markets did put some pressure on net absorption levels. Strong forecasts for white-collar employment in the next six months are expected to lead to a disparity between supply and demand in the short term. This, coupled with the improving economic climate, suggests a decrease in vacancy rates to 5% by 2012[1] .

The Victorian economy remains relatively strong and effective rents now appear to have stabilised. Melbourne’s A Grade face rents have generally remained firm with face rents remaining at $436, compared to average Sydney A grade rent of $675[2] , although effective rents have reduced by almost 13%[1] in anticipation of a blowout in vacancies. Ongoing and pent up demand should continue to provide strong and consistent rental growth, from a base substantially lower than other CBD office market in Australia.

Private and foreign investors have generally accounted for over 50% of CBD buying activity in the past ten years. However, they were relatively inactive during the global financial crisis. The Melbourne CBD achieved 23 commercial office sales with a total value of $942 million in the year to December 2009. The average yield for A Grade office buildings in the quarter to December 2009 is 8.00%, a 100 basis point softening over the year[2] . However, this subdued period in office market investment is considered to be coming to an end with re-capitalised listed domestic real estate funds back in the market. Similar to the competitive rental rates, capital values on a dollar per square metre basis in Melbourne remain considerably cheaper than Sydney, Perth and Brisbane. This coupled with the forecast rental growth and pent up demand makes the Melbourne office sector attractive to potential purchasers as the wider economic conditions improve.

[1] exhibition street valuation, Cb richard ellis, March 2010

[2] savills office Market report, January 2010

the summary above reflects CPsl’s beliefs at the date of this document.

18 EXPLANATORY MEMORANDUM

4.5 TgA PROPERTY

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PropertyDetails
address	136 narrabundah lane,symonston aCt 2609
sector	Commercial
land area	173,500 sqm
lettable area	18,526 sqm
occupancy	100%
Caprate	8.50%
lease term	7.5years
Major tenant	therapeutic Goods administration(tGa)

4.5.2 Market Summary

In their valuation summary (see Section 4.9) Colliers International has included a market summary in relation to the Canberra office market.

4.5.1 Asset Summary

The TGA Property consists of 2 separate buildings on a 17.35 hectare site approximately 8 kilometres from the Canberra CBD. The main building is a world class office and laboratory facility.

The TGA Property is leased until 2017 to the Commonwealth of Australia represented by the Therapeutic Goods Administration, which is a unit of the Australian Government Department of Health and Ageing. The TGA carries out a range of assessment and monitoring activities to ensure therapeutic goods available in Australia are of an acceptable standard with the aim of ensuring that the Australian community has access, within a reasonable time, to therapeutic advances.

Subject to any necessary approvals, there is scope for significant expansion of the existing facilities.

The Trust currently has a two-thirds ownership interest in the TGA Property. The acquisition of the final third interest from CPF would give the Trust 100% control of all decisions relating to the asset.

EXPLANATORY MEMORANDUM 19

4.6 iMPAcT ON PORTfOLiO

Key Property Portfolio Statistics

The impact of the acquisition of the Exhibition Property and the one-third interest in the TGA Property on the existing Group property portfolio is dependent on whether the heads of agreement that is in place for the Exhibition Property (“Exhibition HOA”) is successfully converted to an agreement to lease. The information contained in this section shows, where applicable, the impact on the proforma Group December 2009 statistics of the acquisition of the Properties with and without the successful conversion of the Exhibition HOA to an agreement to lease.

==> picture [506 x 28] intentionally omitted <==

----- Start of picture text -----

Proforma Dec-09 Proforma Dec-09
Actual Dec-09
with Exhibition HOA [1] with Exhibition Vacant [1]
----- End of picture text -----

Portfolio Value	$1.12b	$1.25b	$1.25b
number of Properties	23	23	23
occupancy	99.1%	96.6%	93.1%
Weighted average lease term	4.80yrs	5.26yrs	4.53yrs
Weighted average Cap rate	8.54%	8.50%	8.50%
net lettable area	455,972 m2	484,736 m2	484,736 m2

[1] excludes village Cinemas, launceston which was sold and settled in January 2010

[2] number of properties is unchanged as the proforma statistics exclude village Cinemas, launceston and include the exhibition Property. the tGa Property is already included in part at dec-09 as Cromwell Group currently owns two-thirds.

Geographic Diversification

The acquisition of the Properties increases the Group’s exposure to the Victorian market. This means that the Group will be more exposed to the effect of changes in demand, rentals and valuations in this market. However, Cromwell expects the Melbourne office market to be the first major Australian office market to see sustained rental growth.

Sector Diversification

The addition of the Properties would increase the Group’s exposure to the commercial office market, which is Cromwell’s current preferred market sector, being the sector in which it sees the best short to medium growth prospects.

Geographic Diversification by Value[1]

sector Diversification by Value[1]

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----- Start of picture text -----

100% 1% 1%
8% 7% Wa
3% 2% sa
tas
75% 34%
29% ViC
aCt
nsW
50%
27% 26% Qld
25% 13% 12%
19% 18%
0%
Dec-09 Proforma
Actual Dec-09 with
or without
Exhibition
HOA
----- End of picture text -----

==> picture [232 x 199] intentionally omitted <==

----- Start of picture text -----

100%
10% 9% industrial
4% 3%
retail/
75% entertainment
Commercial
50%
86% 88%
25%
0%
Dec-09 Proforma
Actual Dec-09 with
or without
Exhibition
HOA
----- End of picture text -----

[1] there is no impact on this data whether or not the exhibition hoa is converted to a lease, as it is based on the value not income of the asset.

20 EXPLANATORY MEMORANDUM

Lease Expiry Profile

The impact of the acquisition of the Properties on the lease expiry profile of the Group varies significantly depending on whether or not the Exhibition HOA is converted to an agreement to lease. In both scenarios the current vacancy is increased, reflecting the remaining vacant four floors and retail space in the Exhibition Property.

lease Expiry profile[1] actual Dec-09

lease Expiry profile[1]

with Exhibition Hoa

lease Expiry profile[1] with Exhibition vacant

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----- Start of picture text -----

40.3%
40% 50% 50%
44.2%
40% 40%
37.2%
30%
4.80 years 5.26 years 4.53 years
30% 30%
20%
15.2% 20% 20%
13.7% 13.3%
10% 6.1% 8.5% 7.6% [8.2%] 9.7% 10% 7.3% 6.8% [7.4%] [8.7%] 10% 11.7% 7.1% 6.6% [7.2%] [8.5%]
5.4% 5.3%
3.5% 3.4% 3.1% 3.0%
0.9%
0% 0% 0%
[1] Percent of Gross Income by financial year
Vacant2010201120122013201420152016Thereafter Vacant2010201120122013201420152016Thereafter Vacant2010201120122013201420152016Thereafter
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Tenant Classification

There is minimal change to the tenancy mix of the Group if the Properties are acquired.

Gross Income by tenant classification

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----- Start of picture text -----

100%
Private /
17% 15% 16%
Company
listed
75%
30% 34% 30% Company /
subsidiary
Government
50%
authority
53% 51% 54%
25%
0%
Dec-09 Proforma Proforma
Actual Dec-09 with Dec-09 with
Exhibition Exhibition
HOA Vacant
----- End of picture text -----

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tGa Property

EXPLANATORY MEMORANDUM 21

4.7 fiNANciAL iMPAcT Of AcqUisiTiON

4.7.1 Basis of Preparation

The financial information has been presented in an abbreviated form, in so far as it does not include all the disclosures required by the Australian Accounting Standards applicable to annual financial reports prepared in accordance with the Corporations Act.

The forecasts contained within the financial information have been prepared on the basis of the best estimate assumptions set out within the relevant sections of the financial information and key accounting policies set out in the most recent annual and half year financial reports for the Trust and Cromwell Group lodged with ASX and should be read in conjunction with those assumptions and accounting policies. The directors of Cromwell Group believe that the forecasts contained within the financial information are reasonable and are based on best estimate assumptions as set out in this section. Although due care and attention has been taken in preparing the financial information, many factors which affect the financial information are outside the control of the directors or are not capable of being foreseen or accurately predicted. As such, actual results may differ materially from the financial information.

Forecasts have been prepared for the financial years ending 30 June 2010 - 2012 (“Forecast Period”).

4.7.2 Forecast Source and Application of Funds

Settlement of the Acquisition Proposal transactions are expected to occur on or before 30 June 2010, although costs associated with the refurbishment and leasing of the Exhibition Property are not expected to be incurred until the year ending 30 June 2011 or later.

Funds for the acquisition of the Properties and completion of the refurbishment and leasing of the Exhibition Property are assumed to be sourced and applied as set out below.

	$’000	$’000	$’000
sources of funds Cash1	Exhibition 68,081	TgA 12,059	TOTAL 80,140
Bank loans	80,000	12,941	92,941
reduction in loan receivable2	10,200	-	10,200
subtotal	158,281	25,000	183,281
Application of funds
Purchase of Properties Propertyacquisition Costs3 refurbishment and leasingCosts4	90,200 5,115 62,623	25,000 - -	115,200 5,115 62,623
loan establishment Costs5	343	-	343
	158,281	25,000	183,281

[1] existing cash resources of the Group.
[2] Part of the consideration for the acquisition of exhibition street will be the partial reduction of the existing loan from dPt to CPf.
[3] Includes property stamp duty, legal and other professional fees and due diligence costs relating to the acquisition of the Properties.
[4] Includes costs of refurbishment consultant fees, lease incentives and leasing costs in accordance with the valuation plus capitalised interest during the refurbishment period. further details are set out under the heading “Property acquisition, refurbishment & leasing” in section 4.7.5.
[5] Includes loan facility establishment costs, valuation fees and legal and other professional costs relating to the arrangement of the amended loan from existing financier.

Refurbishment and leasing costs will be funded from existing cash resources of the Group and are expected to be incurred in the following periods:

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----- Start of picture text -----

$’000
----- End of picture text -----

Financial year ending	30	June	2010	-
Financial year ending	30	June	2011	51,352
Financial year ending	30	June	2012	4,271
				62,623

22 EXPLANATORY MEMORANDUM

4.7.3 Forecast Pro-forma Balance Sheet

Set out below is the forecast pro-forma balance sheet of the Group, including the Trust. The pro-forma balance sheet assumes the Properties are acquired, the refurbishment has been completed, leasing costs fully expensed and the loan from the existing financier is fully drawn. The forecast pro-forma balance sheet should be read in conjunction with the best estimate assumptions and key accounting policies set out within the relevant sections of the financial information and the last annual and half-year financial reports for the Group and the Trust.

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----- Start of picture text -----

Actual 31 Dec 2009 Proforma Adjustments Proforma 31 Dec 2009
$’000 $’000 $’000
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current assets
Cash and cash equivalents	104,769	-79,553	25,216
trade and other receivables	30,101	-	30,101
other current assets	4,688	-	4,688
Total current assets	139,558	-79,553	60,005
Non-current assets
trade and other receivables	30,062	-10,200	19,862
investmentproperties1	1,074,200	232,938	1,307,138
investments at fair value throughproft and loss	3,924	0	3,924
investments injointlycontrolled entityand associates	57,126	-50,587	6,539
other non-current assets	2,974	0	2,974
Total non-current assets	1,168,286	172,151	1,340,437
Total assets	1,307,844	92,598	1,400,442
current liabilities
trade and otherpayables	12,411	-	12,411
Borrowings	3,321	-	3,321
distributionspayable	14,244	-	14,244
Provisions	12,201	-	12,201
other current liabilities	7,507	-	7,507
Total current liabilities	49,684	-	49,684
Non-current liabilities
Borrowings2	669,152	92,598	761,750
	403	-	403
Total non-current liabilities	669,555	92,598	762,153
Total liabilities	719,239	92,598	811,837

Net assets	588,605	-	588,605

total equityattributable to shareholders	9,605	-	9,605
total equityattributable to unitholders	579,000	-	579,000
Total equity attributable to stapled securityholders	588,605	-	588,605

net tangible assets(nta) per stapled security	$0.73		$0.73
Gearing (total borrowings: totalproperty)	59%		58%
Gearing (net debt less cash: total assets less cash)	47%		54%

[1] Investment Property is included at fair value. the fair value of the exhibition Property is assumed to equal the total cost on completion of the refurbishment and leasing.

[2] borrowings are effectively net of the costs of establishing debt facilities which are amortised as finance costs over the term of each facility.

EXPLANATORY MEMORANDUM 23

4.7 fiNANciAL iMPAcT Of AcqUisiTiON cONTiNUED

4.7.4 Forecast Impact on Earnings

Operating earnings available for distribution are calculated by the directors excluding certain significant items such as fair value adjustments and non-cash property income or expenses including amortisation.

The Acquisition Proposal is forecast to have the following impact on earnings during the Forecast Period.

The forecast impact on earnings has been calculated by including the expected earnings from the Properties during the Forecast Period and adjusting for additional income expected to be earned from CPF and interest income expected to be foregone from the cash utilised to acquire the Properties and the reduction in the loan to CPF.

	FY10	FY11	FY12
impact on earnings	+0.0 cps	+0.1 cps	+0.6 cps
impact on operatingearnings	+0.0 cps	+0.1 cps	+0.4 cps

4.7.5 Key Forecast Assumptions

The forecasts presented above are for the Forecast Period, and are based on the Trust’s key accounting policies and the following material best estimate assumptions:

property acquisition, Refurbishment & leasing

Material assumptions are:

| The Properties are acquired on 30 June 2010;
| Refurbishment costs are incurred in accordance with the expected timetable provided by the project manager; and
| Completion of the refurbishment occurs on 30 June 2011.

Total refurbishment and leasing costs are expected to be $62,623,000 made up as follows:

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----- Start of picture text -----

$’000
refurbishment costs including consultants 25,130
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refurbishment costs includingconsultants	$’000 25,130
Capitalised interest duringrefurbishmentperiod Holdingcosts(rates andpropertyoutgoings) leasingcosts and incentives	5,480 1,250 30,7631
Total acquisition, refurbishment & leasing costs	62,623

[1] this amount reflects the current leasing costs and incentives being paid in relation to large scale new leases in the Melbourne Cbd office market.

net property income

Net property income is the gross income received from the Properties less property outgoings. The main assumptions underlying the forecast net property income are:

| The Exhibition HOA with Potential Tenant at Exhibition Property is converted to a lease;
| The balance of the Exhibition Property is leased from 1 October 2010 in accordance with the Exhibition Valuation assumptions and the lessee fulfills its obligations under the terms of the lease;
| Leasing costs, vacancy periods and lease incentives for the balance of the Exhibition Property are in accordance with the Valuer’s assumptions;
| Income increases in accordance with the Exhibition HOA, with the remaining vacancies assumed to increase by CPI of 2.5% pa;
| There are no tenant defaults during the Forecast Period;
| Property outgoings consist of rates, taxes and other property outgoings in relation to the Properties and are in accordance with valuers’ assumptions; and
| Property outgoings and other recoveries are collected from tenants in accordance with the relevant lease provisions. Property outgoings increase by CPI of 2.5% pa.

cromwell property Fund

Distributions are recommenced at 2.0 cents per unit and Cromwell earns funds management fees at 25% of its full entitlement.

Fair value adjustments – investment property

Initially the investment properties will be measured at cost, including acquisition costs, and then carried at fair value. It is assumed that the valuation of the Exhibition Property at practical completion of the refurbishment is equal to the total costs, including refurbishment and leasing costs. From that date on, it is assumed the fair value of the investment property during the Forecast Period increases by the amount of capital expenditure, straight-line rental assets and lease incentives such that no gain/loss on fair value adjustment is recognised in the income statement.

Finance costs

Finance costs include interest and other costs incurred in connection with the arrangement of borrowings. Interest costs have been shown separately from amortisation costs in the forecast income statement. The combination of the underlying variable rates and the margin payable under each facility for the Forecast Period are expected to result in effective fixed interest at the rates indicated below. It is assumed that CPF’s existing loan in relation to the TGA Property is refinanced or extended at expiry in March 2011 at a margin which is comparable to the new 3 year debt facility the Trust will enter into to acquire the Exhibition Property.

		Year ending 30 Jun 11	Year ending 30 Jun 12
	interest rate(average includingmargins) total interest costs less capitalised amount interest recognised in income statement	6.7% 6,322,000 5,480,000 842,000	7.4% 6,834,000 - 6,834,000

Interest Income

Interest income is earned (or foregone on cash used to fund the Acquisition Proposal) at the following rates:

		Year ending 30 Jun 11	Year ending 30 Jun 12
	interest rate(average)	5.0%	5.5%

24 EXPLANATORY MEMORANDUM

loans

The existing external facility for CPF’s one-third interest in the TGA Property and the new debt facility for the Exhibition Property are assumed to be fully drawn from 30 June and for the balance of the Forecast Period. The key loan terms are assumed to be in accordance with those set out in Section 4.2.

It is assumed the TGA loan is able to be refinanced or extended on expiry on similar terms, with adjustment of the underlying interest rate margin to be in accordance with the current market.

4.7.6 Pro Forma Adjustments

Although settlement is not assumed to occur until 30 June 2010 and the refurbishment and leasing costs for the Exhibition Property will be progressively paid during FY11 and FY12, the pro-forma balance sheet of the Group has been prepared as if the following transactions had taken place as at 31 December 2009:

TGA Property

| One-third interest in the TGA Property has been acquired from CPF by making a cash payment of $12,059,000 and by taking over the existing CPF debt in relation to the property of $12,941,000. Once acquired, the Group will fully own the TGA Property and it will become fully consolidated into the balance sheet of the Group and accounted for as an investment property;

Exhibition Property

| The Exhibition Property has been acquired from CPF by making a cash payment of $80,000,000 and reducing the balance of the loan owing by CPF to DPT by $10,200,000;
| Payment of stamp duty of $4,961,000;
| Payment of refurbishment, leasing and other costs of completing the Exhibition Property of $62,623,000;
| The bank loan of $80,000,000 has been fully drawn and borrowing costs of $343,000 paid; and
| Cash of $79,553,000 (net of cash acquired in association with the purchase of the TGA Property) has been utilised by the Group from its cash reserves.

4.7.7 Sensitivity Analysis

The forecasts have been based on certain economic and business assumptions about future events. The forecast earnings and operating earnings are for each period during the Forecast Period sensitive to a number of factors. A summary of the possible impact of different outcomes in the key assumptions underlying the forecasts is set out below. However, the disclosed movements in these key assumptions are not intended to be indicative of the complete range of variations that may occur.

Variable Effect

change in under the tGa lease, 100% of the net property income is fixed net property for the Forecast Period. there is not expected to be any impact income on net property income.

net property income	for the Forecast Period. there is not expected to be any impact on net property income.
	the balance of the exhibition Property is assumed to be leased
	from 1 october 2011. if the space was fully leased for the entire Forecast Period, the impact on proft would be unchanged in
	FY11 and +$920,000 or 0.1 cents eps in FY12. if the space remained vacant for all the Forecast Period, the impact on proft
	would be unchanged in FY11 and -$2,750,000 or -0.3 cents eps
	in FY12.
	the forecasts assume the heads of agreement is converted to a lease and the Potential tenant fulfls their obligations under
	the lease. if the space remained vacant for all of the Forecast Period, the impact on proft would be unchanged in FY11 and
	-$12,036,000 or -1.5 cents eps in FY12.
	should net property income increase or decrease during the
	Forecast Period for any other unforeseen reason (e.g. tenant
	default), each +/- 5% change in net property income would lead
	to approximately a +/- $135,000 or 0.0 cents eps in FY11 and
	+/- $822,000 or 0.1 cents eps in FY12.
change in interest	the majority of interest expense is forecast to be variable for the Forecast Period. CPsl may elect to fx or otherwise hedge all or
rates	part of interest expense in accordance with the hedging policy.
	if forecast interest rates increased or decreased by 1% pa for
	the Forecast Period, the impact of the change in interest payable
	for the relevant period would lead to a change in earnings of
	approximately +/- $130,000, which represents +/- 0.0 cents eps
	in FY11 and +/- $930,000 or 0.1 cents eps in FY12.
fair Value of	the forecasts assume the date of acqusition is 30 June 2010
investment	and the investment property then increases in value only by the
Properties	amount of the capital expenditure, straight-line rental assets
	and lease incentives. each +/- 1% change in the fair value of
	the investment property would lead to an approximate change
	in the fair value adjustment of +/- $1,152,000 and a change in
	the net assets of the Group by the same amount, representing
	approximately a +/- 0.14 cent change in the net asset value per
	security.
increased	Cromwell Group has entered into a fxed price contract for the
refurbish-	refurbishment of the exhibition Property. the contract includes
ment costs	provisions designed to minimise the risk of variations to the
	contract price or extensions of time. therefore, the Group
	has limited it’s exposure to refurbishment costs in excess of
	those referred to elsewhere in section 4.7. notwithstanding
	that, if refurbishment costs were to change, then for each +/-
	$1,000,000 in refurbishment costs there would be a +/-0.12
	cent change in net asset value per security.
Delay in	Cromwell Group has signifcant experience in delivering large
making the building	scale projects on time and within budget. refurbishment commenced on the scheduled date. a signifcant buffer has
available to tenants	been incorporated within the timeline to ensure the refurbished building, incorporating their ftout requirements can be
	delivered to the Potential tenant within the required timeframe.
	if there are delays in delivery of the building to the Potential
	tenant, the starting date of the lease and therefore the date
	from which rental income will be received, will be delayed by a
	corresponding period. each change of +/- $1,000,000 in rental
	income received in the Forecast Period results in +/-0.12 cent
	change in earnings per security in FY12.

4.7.8 Taxation

It is expected that the Trust’s income tax position will not be materially impacted by acquiring the Properties.

EXPLANATORY MEMORANDUM 25

4.8 ADVANTAgEs & DisADVANTAgEs

4.8.1 ADVANTAGES:

the interest in the properties are being acquired at a good time

The interest in the Properties are being acquired at a time which CPSL and many other market commentators, believe is a trough or low point in the market. As a result Cromwell also believes that there is good potential for capital growth in both assets.

Familiar with the properties

The Group is very familiar with the Properties through its role as manager since their original acquisition in 2002 (TGA Property) and 2006 (Exhibition Property).

Increased scale and diversification benefits

The interest in the Properties being acquired are in accordance with the Group’s investment policy and will increase the size of the Group’s property portfolio and number of properties held. It will also increase the diversification of the Trust’s tenant mix. An increased number of properties owned and greater diversification in tenants generally reduces risk.

Earnings accretive

The Acquisition Proposal is expected to increase statutory earnings per security by 0.1 cents in the 2011 financial year and by 0.5 cents in the 2012 financial year as set out in Section 4.7. The Acquisition Proposal is also expected to increase operating earnings per security (from which the Group determines distributions) by 0.1 cents in the 2011 financial year and by 0.5 cents in the 2012 financial year as set out in Section 4.7. However, these outcomes could change if the assumptions set out in Section 4.7 do not prove to be correct. A sensitivity analysis on the impact of changes in various key assumptions on earnings is set out in Section 4.7.

Increase in Group’s weighted average lease term

The addition of the one-third interest in the TGA Property and the Exhibition Property (assuming the heads of agreement with the Potential Tenant is converted into a signed agreement to lease) will increase the Group’s weighted average lease term from 4.80 years to 5.26 years. This provides increased security of income to securityholders.

Full control of the tGa property

The purchase of the remaining one-third interest in the TGA Property provides the Group with 100% control of the asset. This means that CPSL can manage the TGA Property solely in the best interests of the Group’s securityholders.

Reduced Group exposure to, and improved income from, cpF

The Acquisition Proposal and associated debt restructure within CPF are expected to stabilise CPF’s financial position, reduce the future risk of reduced income or non-recoverability of the loan to CPF and increase the prospects for an improvement in the value of the Group’s equity investment in CPF.

Completion of the Acquisition Proposal is also expected to allow the re-commencement of distributions and management fees paid to the Group by CPF. In addition, the Trust’s loan to CPF will be reduced from $30 million to $20 million and the interest rate increased in line with the reset finance facility with an external financier.

26 EXPLANATORY MEMORANDUM

4.8.2 DISADVANTAGES:

concentrated market exposure

The Trust will increase its exposure to the Melbourne office market to 34% of the Group’s portfolio by value. Increased exposure to this market means that the Group will be more vulnerable to the effect of changes in demand, rental and valuation in this market over time.

However, Cromwell expects the Melbourne office market to be the first major Australian office market to see sustained rental growth as the broader economy continues to gradually improve.

Increased level of gearing in the Group

If the Acquisition Proposal is completed, the gearing level of the Trust (net debt: total assets less cash) will increase from 47% to 54%, which is with in the Group’s target range of 40-55%, albeit at the high end. Whilst the change in gearing level will reduce the Group’s ability to make further acquisitions in the short term, the gearing level will still be below the Group’s current loan to value ratio covenant. Further, the change in gearing will occur over time as the refurbishment and leasing of the Exhibition Property is completed, allowing the Group time to potentially undertake future capital management initiatives in the short to medium term, such as on equity raising, sale of smaller non-core assets or reactivating the distribution reinvestment plan, which could reduce gearing or minimise any increase.

cpF will remain highly geared

Cromwell Group will retain an investment in CPF and CPF will remain relatively highly geared and therefore somewhat vulnerable to further asset value declines and interest rate rises, although with a reasonably stable property income stream.

However, the Board believes that commercial property valuations have reached their lows and will start to improve over time. If that is correct then CPF’s gearing will also gradually improve over time which will, in turn, improve the value of the Group’s investment in CPF.

preconditions

There are a number of preconditions and other requirements to successfully execute the Acquisition Proposal, and there is a risk that one or more of these preconditions will not be satisfied. If that is the case then securityholders are unlikely to be asked to consider the Acquisition Proposal.

Increased Vacancy

The heads of agreement with the Potential Tenant is not binding and there is no guarantee that a lease will be finalised, or that the lease will contain substantially the same terms as the heads of agreement. Even if a lease with the Potential Tenant is signed there still remains 6,774 square metres of space to lease in the Exhibition Property, which equates to 1.4% of the Group’s total portfolio.

The CPSL Board believes that there is a high likelihood that the heads of agreement with the Potential Tenant will be converted to a lease on substantially similar terms and that the remaining vacant space will be leased by 1 October 2011.

EXPLANATORY MEMORANDUM 27

4.9 VALUATiON sUMMARY tGa ProPertY

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28 EXPLANATORY MEMORANDUM

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EXPLANATORY MEMORANDUM 29

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30 EXPLANATORY MEMORANDUM

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EXPLANATORY MEMORANDUM 31

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32 EXPLANATORY MEMORANDUM

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EXPLANATORY MEMORANDUM 33

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34 EXPLANATORY MEMORANDUM

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EXPLANATORY MEMORANDUM 35

4.10 VALUATiON sUMMARY eXHiBition ProPertY

V A L U A T I O N & A D V I S O R Y S E R V I C E S

9 April 2010 The Directors Cromwell Property Securities Limited Level 19 200 Mary Street BRISBANE QLD 4000 Dear Sirs

CB Richard Ellis (V) Pty Ltd Licensed Estate Agent ABN 15 083 694 357 Level 32, Rialto North Tower 525 Collins Street Melbourne VIC 3000 T 61 3 8621 3333 F 61 3 8621 2758 www.cbre.com.au

Summary of Valuation Report 321 Exhibition Street, Melbourne Victoria 3000

Instructions

CB Richard Ellis (V) Pty Ltd accepted instructions dated 29 March 2010 to prepare a market Valuation of the property listed above. The Valuation is to be relied upon for Acquisition, Financial Reporting, Explanatory Memorandum and First Mortgage Security purposes and is specifically addressed for use and reliance upon by the party named above and as nominated in the Full Report. The Valuation is prepared in accordance with the Australian Property Institute Australia and New Zealand Valuation and Property Standards June 2008, having regard to ANZVGN 8, Valuations for use in Offer Documents. The instructions specifically request us to provide our opinion of the market value of the 100% interest in the property as at 31 March 2010 on the following bases:

Market Value ‘As Is’ subject to existing tenancies (i.e. vacant).

CB Richard Ellis (V) Pty Ltd has been requested to provide a Full Valuation Report in addition to this Summary Letter for inclusion in the Explanatory Memorandum. In accordance with ANZVGN 8, our Full Valuation Report draws attention to the key issues and considerations impacting value and provides a detailed Property Risk Assessment and SWOT Analysis, plus the report details our Critical Assumptions, Assumptions, Disclaimers, Limitations and Qualifications and our Recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, it is considered prudent to consider the entire content of our Full Valuation Report. Therefore, we advise that this letter is to be read in concert with the said Full Valuation Report. We accept no responsibility for reliance upon this Summary Letter in isolation. We refer the reader to Cromwell Property Securities Limited to obtain a copy of our Full Valuation Report.

Director and Licensed Estate Agent: M. L. HADDON AREI CEA (REIV) SA Fin

36 EXPLANATORY MEMORANDUM

V A L U A T I O N & A D V I S O R Y S E R V I C E S

Brief Description of the Property and Tenancy

321 Exhibition Street was completed in 1990 and provides a single level of basement car parking, a ground level foyer and lift lobby together with 18 upper levels of office accommodation (four of which are larger podium levels). Retail accommodation is located to the Exhibition and La Trobe Street frontages. The total NLA is 30,918 sqm, with 54 car spaces for tenant use.

As the building is now wholly vacant, Cromwell Property Securities Limited (CPSL) will embark on a full building cosmetic and services refurbishment with the building aspiring to achieve a 4.5 Star NABERS and 5 Star Green Star Version 3 ratings upon completion. It is on this basis that CBRE have approached the valuation of the asset.

The building is vacant and has been has been subject to a leasing campaign since the intentions of Australia Post to vacate became known in 2007. Whilst no tenant commitments have been obtained as yet, the property provides one of only a handful of options for tenants seeking > 10,000 sqm and the only option for an existing building for tenants seeking > 20,000 sqm. Should the refurbishment program commence in April 2010, it is possible the asset can be ready for tenant fitout integration prior to year end, therefore occupation in early to mid 2011. Cromwell are in advanced negotiation with two groups, however at the date of this advice no terms has been agreed.

Market Instability

Whilst economic conditions and market sentiment continues to improve, the availability of funds still remains tight. Limited liquidity in capital markets (although improving), and the high cost of debt means that it may be difficult to achieve a successful sale of this asset in a shortened timeframe and we would recommend that the situation and the valuations are kept under regular review and specific marketing advice is obtained should a disposal be contemplated.

Critical Assumptions and Reliance on Information Provided

A summary of select Critical Assumptions noted in the full Valuation Report are noted as follows:

Our instructions are from Cromwell Property Securities Limited as Responsible Entity for the Cromwell Diversified Property Trust who are contemplating an internal acquisition of 321 Exhibition Street from a separate fund, Cromwell Property Fund. Our discussions with Paul Weightman of Cromwell indicate that both parties have access to all relevant information and material which is currently the intellectual property of the current owning entity and Cromwell Property Securities Limited. Accordingly we have relied upon full disclosure of all relevant information by Cromwell. As at the date of this advice we are not aware of a Contract of Sale or other legal, environmental, or physical due diligence having been prepared. We understand this valuation will be considered when negotiating the sale/purchase. Accordingly should information change we reserve the right to review our valuation.
Our assessment addresses the market value of the property subject to vacant possession.
Our valuation is undertaken assuming the following notional hypothetical tenancies are leased from the dates as noted. These are market based estimates only and in the opinion of

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321 Exhibition Street, Melbourne

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the valuer should be achievable given the competitive shallow leasing market (supply) which exists presently. This approach enables the demonstration of the possible future tenancy profile following the refurbishment program. Our modelling assumes the following notional occupancies:

Tenancy A	Levels	13 – 20	9,932 sqm	Term 10 years	Commencing 1 April 2011.
Tenancy B	Levels	6 – 12	9,585 sqm	Term 10 years	Commencing 1 July 2011.
Tenancy C	Levels	G, 1 – 4	10,000 sqm	Term 10 years	Commencing 1 October 2011.

Rental down time between the valuation date and commencement date, incentive allowances equivalent to 18.5% of gross lease value and agency commissions have been allowed for within our calculations. Ultimately the value of the building will rise and fall upon the outcome of the leasing campaign and/or current negotiations. Hence, the valuation should be kept under regular review and may rise and fall as time lapses, construction period progresses and as commercial lease terms are agreed.

Our valuation calculations include rental growth assumptions throughout a defined cash flow period. These assumptions have been based on prevailing economic and market conditions as at the date of valuation.
Our valuation assumed refurbishment consistent with the ‘321 Exhibition Street Building Refurbishment March 2010’ document as prepared by Montlaur Project Services.
Our valuation assumes that the asset will be redesigned to achieve a minimum 4.5 Star NABERS rating and 5 Star Green Star as Design (V3) as built rating, consistent with the above document.
Cromwell have appointed Slattery Australia and Montlaur Project Services to provide professional consultancy in respect of the works. Slattery have in the past provided cost estimates and more recently have reviewed submitted tenders. Whilst Montlaur have provided technical assistance and co-ordinated contractors/consultants. We have relied upon the advice provided to Cromwell by these groups, including the conclusions of the Tender Report dated 25 February 2010 and Timing Estimates prepared by Montlaur. Cromwell have advised as at the date of this advice Ireland & Brown are firming as the likely contractor, hence we have adopted a fixed price construction price of $23,312,745 plus GST. Ireland & Brown’s tender presupposes a 12 April 2010 commencement date with the bulk of refurbishment works completed by November 2010 or if started on 1 June completion by December 2010. Accordingly our valuation assumes completion no later than 1 January 2011 enabling tenants to undertake or integrate fitout works for first occupation from 1 April 2011. Should this be unachievable, our valuation will require review. Likewise, should cost estimates allowed within our valuation be exceeded, the value will change. Hence, we reserve the right to revisit our valuation should these items vary upon the execution of the Head Contractors Building Works Contract.
Our valuation assumes allowances to rectify floor deflections will not exceed amounts estimated by the tenderers.

321 Exhibition Street, Melbourne

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38 EXPLANATORY MEMORANDUM

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Our valuation assumes should a sale/transfer of the asset occur that all existing consultants are paid in full and that all advice will be novated to any new owner.
Our valuation assumes that the building refurbishment and costs provided will enable the asset to comply with all relevant Building Codes and Regulations.

� Cromwell previously advises and continue to advise that they will enter into an Energy Service Agreement with Cogent Energy, who will bear the cost of the installation of the co-generation plant, own and maintain the equipment, for a period of 12 years, at which time it will revert to the ownership of Cromwell. Over the term Cogent Energy will receive the receipts for electricity income (from the tenants - which is represented to be inline or potentially below a market rate) in order to fund their investment. Whilst unique in Melbourne, Mirvac have entered into a like agreement for their asset (50% interest) at 101 Miller Street North Sydney. We have not sighted any documentation to formalise the agreement and inherently our valuation is reliant upon this being executed with no additional cost to Cromwell, other than for those costs as contained in the refurbishment costings provided. Accordingly if commercial agreement is not met on this basis, we reserve the right to review our valuation.

� The building manager advises that a 10,000 litre underground Diesel storage tank is present on site. The tank failed an integrity test in the past and was subsequently emptied and decommissioned. We have not been provided with a report outlining the current conditions, accordingly by necessity we have assumed the site is free of contamination. Prior to relying upon this advice we recommend further investigation occur to ensure that surrounding soils and ground water have not been impacted.

� Agreement Section 173 Planning and Environment Act 1987 via Instrument N951327R dated 12 January 1989. The extent of this encumbrance is unknown as a search of the register failed to locate the document. It is noted on Title that further information can be sought with regard to this, via written instructions to The Manager at Land Information Centre. It is a specific assumption of our advice that this encumbrance does not have an adverse affect on the property as it is currently developed and no onerous liability is placed on the owner.

� We have relied on tenancy areas provided, compiled from NLA surveys attached to the leases along with select floor revisions. Upon completion of the refurbishment should a new NLA survey undertaken in accordance with the PCA Method of Measurement differ considerably we reserve the right to review this valuation.

In undertaking this valuation, we have relied upon the information provided by Cromwell Property Securities Limited as being true and correct.
Our valuation is based upon the most current information available at the time the valuation was prepared. CBRE accepts no responsibility for subsequent changes in information as to income, expenses or market conditions. Any subsequent change in lease terms will also have a corresponding change to the value.

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321 Exhibition Street, Melbourne

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Report Content

Our Full Valuation Report, in addition to the content noted earlier, contains detailed information and description pertaining to; Instructions, Use and Reliance, Site Details including Location, Legal, Environmental and Town Planning; and Building Improvements along with analysis of the asset’s Occupational and Financial attributes. This is followed by a comprehensive Economic, Investment Market and Melbourne Commercial Office Market Overview and details of the sales evidence regarded, along with our Investment Considerations. Finally, the report considers the value on each bases and comments on the Future Value Prospects for the asset. We again refer the reader of this Summary Letter to the content of our Full Valuation Report for detail in respect of the above items.

Valuation Rationale

In arriving at our opinions of market value in accordance with the instructions, we have placed primary emphasis on the capitalisation of market net income approach and have also adopted discounted cashflow analysis. A detailed explanation of the assets investment credentials and the application of the capitalisation of market income and discounted cashflow methodology is provided in the Full Valuation Report.

We summarise our valuation approaches as follows:

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321 Exhibition Street, Melbourne

40 EXPLANATORY MEMORANDUM

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Capitalisation Approach

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Area Passing Rent Market Rent
Gross Rental Income Notional Tenant C 10,000.0 4,571,690 4,571,690
Notional Tenant A 9,932.0 4,881,708 4,881,708
Notional Tenant B 9,585.0 4,537,200 4,537,200
Retailer A 913.0 460,878 460,878
Retailer B 488.0 271,667 271,667
Other Office Tenants - -
Other Retail Tenants - -
- -
Monthly
30,918.0 14,723,144 14,723,144
Other Income Carpark Income: 298,080 298,080
Storage Income: 25,350 25,350
Telecommunications Income: 27,227 27,227
Signage/Naming Rights Income: 100,000 100,000
- -
Sundry & Other Income:
Total Other Income (excl. elec profit & a/hrs air): 450,657 450,657
GROSS INCOME 15,173,801 15,173,801
Outgoings Statutory Expenses (including land tax): (756,159) (756,159)
Operating Expenses: (2,013,949) (2,013,949)
- -
Non-Recoverable Outgoings:
Total Outgoings: (2,770,108) (2,770,108)
NET INCOME 12,403,694 12,403,694
Income Adjustments Potential Future Income - Vacant Tenancies: - -
- -
Potential Future Income - Vacant Car Bays:
- -
Potential Future Income - Vacant Sundry:
Vacancy/Bad Debts Allowance: 0.00% - -
- -
Total Income Adjustments:
FULLY LEASED NET INCOME (After vacancy allowance) 12,403,694 12,403,694
CAPITALISED VALUE Capitalise In Perpetuity @ 8.00% 8.00%
155,046,171 155,046,171
Capital Adjustments
Vacancies Letting Up Allowance: (Sundry) (152,577) (152,577)
Rent Shortfalls - Refurbishment to Commencement: (18,186,782) (18,186,782)
PV of Incentives: (22,752,114) (22,752,114)
Rent Adjustments PV of Capitalised Rent Reversions: - -
- -
Reverse of above (passing vs market rentals):
- -
PV of Capitalised Car Park & Sundry Income Reversions:
- -
Reverse of above (passing vs market rentals):
- -
Elec Profit & A/hrs Air Cap @:
- -
PV of Future Letting Up Allowances: 1 years
PV of Future Leasing Commissions: 2 years (1,520,818) (1,520,818)
PV of Future Incentive Allowances: 1 years - -
Capital Works PV of Make Good & Refurb Allowance: 1 years - -
PV of General Capital Expenditure: 2 years (23,960,637) (23,960,637)
Total Capital Adjustments: (66,572,928) (66,572,928)
Sensitivity Analysis Passing Market 88,473,244 88,473,244
-0.25% 93,500,000 93,500,000
Adopted Cap Rate 88,500,000 88,500,000 Adopt 88,500,000 88,500,000
0.25% 83,800,000 83,800,000
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321 Exhibition Street, Melbourne

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Discounted Cashflow Approach

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Valuation Period 1 2 3 4 5 6 7 8 9 10 11
Year Ending Mar - 11 Mar - 12 Mar - 13 Mar - 14 Mar - 15 Mar - 16 Mar - 17 Mar - 18 Mar - 19 Mar - 20 Mar - 21
Growth Forecast
CPI (Access Economics) 3.14% 2.53% 2.20% 2.07% 1.52% 2.02% 2.73% 2.54% 2.48% 2.50% 2.50%
Average compound CPI 5yrs 2.29% 10yrs 2.37%
Face Rent Growth (Office) 3.80% 6.13% 6.17% 5.71% 4.68% 3.76% 3.75% 3.39% 3.30% 3.71% 4.00%
Average compound market rental growth 5yrs 5.30% 10yrs 4.40%
Effective Rent Growth 7.83% 8.21% 4.12% 6.75% 5.70% 5.17% 3.95% 3.39% 3.70% 3.71% 4.00%
Average compound market rental growth 5yrs 6.50% 10yrs 5.20%
Face Rent Growth (Retail) 4.14% 3.53% 3.20% 3.07% 2.52% 3.02% 3.73% 3.54% 3.48% 3.50% 3.50%
Average compound market rental growth 5yrs 3.30% 10yrs 3.40%
Car Parking Rent Growth 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50% 3.50%
Average compound market rental growth 5yrs 3.50% 10yrs 3.50%
Purchase Considerations Target Internal Rate of Return Sensitivity Analysis
Purchase Price 91,800,000 I R R PRICE
Stamp Duty 5,049,000 5.50% 10.00% 91,754,093 Terminal Yield
Legal Fees 229,500 0.25% 8.00% 8.25% 8.50%
97,078,500 ADOPT: $91,800,000 Internal 9.75% 96,657 94,096 91,686
Selling Considerations Rate of 10.00% 94,257 91,754 89,398
Terminal Yield 8.25% Year 1 Cash Flow Yield -34.00% Return 10.25% 91,912 89,465 87,162
Commission 0.75% Income % 25.04%
Legal Fees 0.25% Terminal Value % 74.96%
Cashflow Criteria
Assumed New Lease Term (yrs) 10 New Lease Reviews 4.00% Leasing Commissions: New 12.0%
Standard New Lease Recoveries Net Review Frequency Annual Renewal 7.5%
Renewal Probability (Office) 50% 50% 50% 50% 50% 50% 50% 50% 50% 50%
Expiry/Renewal for year (sqm) (Office) 9,932
Leaseup - Office (mths) 12 12
Incentive - Office (%) 18.5% 15.3% 13.7% 15.3% 14.5% 13.7% 12.5% 12.3% 12.3% 12.0% 12.0%
Renewal Probability (Retail) 75% 75%
Expiry/Renewal for year (sqm) (Retail) 1,401 1,401
Leaseup - Retail (mths) 12 3 3
Incentive - Retail (mths) 3 3 3
Vacancy & Bad Debts Allowance
Capital Expenditure (% of Gross Income) 1.0%
Lessors Works/Make Good Allowance (Office) 75 psm
Lessors Works/Make Good Allowance (Retail) 50 psm
Future Building Refurbishment Allowance Year 5 psm Year 11 100 psm
CASHFLOW FORECAST (All figures shown as $1,000's)
Income
Base Rental 11,953 12,198 12,686 13,193 13,721 14,257 14,825 15,420 16,038 16,682 17,704
Recoverable Outgoings 2,770 2,814 2,894 2,962 3,025 3,079 3,134 3,208 3,293 3,376 3,460
Car Parking Income 298 303 315 327 340 354 368 383 398 414 431
Other Income 153 154 160 166 172 179 186 193 201 209 217
Electricity Profit & A/Hours Air
Total Income 15,174 15,468 16,054 16,648 17,259 17,869 18,513 19,204 19,930 20,681 21,811
Less
Statutory Expenses (Inc Land Tax): 756 780 800 817 834 847 864 888 910 933 956
Operating Expenses: 2,014 2,077 2,130 2,177 2,222 2,255 2,301 2,364 2,424 2,484 2,546
Non-Recoverable Outgoings
Vacancy/Bad Debts Allowance
NET INCOME 12,404 12,611 13,124 13,655 14,203 14,767 15,348 15,953 16,597 17,264 18,309
Capital Adjustments
1) Current Unexpended Incentives 26,249
2) Rent Shortfall - New Tenancies 18,187
3) Letting Up Allowances (inc Car Park) 298 76 110 3,984
4) Future Leasing Commissions 1,755 84 834
5) Future Incentive Provisions 215 4,648
6) Capital Expenditure 25,130 161 166 173 179 185 192 199 207 218
7) Lessors Works/Make Good (Office) 471
8) Lessors Works/Make Good (Retail) 20 22
9) Refurbishment Allowance 3,909
10) Y.E. Mar 2022 Letting allowances 17,278
Selling Considerations Net Market Rent End Yr 10 19,757
Sale Price 190,565
Agent's Commission -1,429
Legal Fees -476
NET CASH FLOW - 31,211 - 15,468 12,964 13,488 14,031 14,159 15,162 15,761 16,397 17,057 188,660
Running Yield (Cash Flow) -34.00% -16.85% 14.12% 14.69% 15.28% 15.42% 16.52% 17.17% 17.86% 18.58%
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321 Exhibition Street, Melbourne Page 7 of 9

42 EXPLANATORY MEMORANDUM

V A L U A T I O N & A D V I S O R Y S E R V I C E S

Summary

SUMMARY OF VALUES

Capitalisation Approach - Market Rentals	$88,500,000
Discounted Cash Flow Approach	$91,800,000
A d o p t e d f o r V a l u a t i o n P u r p o s e s	9 0 , 2 0 0 , 0 0 0
Reversionary (Market) Yield	13.75%
Value per square metre of lettable area	$2,917

Valuation Summary

In accordance with the instructions, we summarise our valuation conclusions for the 100% freehold interest in 321 Exhibition Street, Melbourne as at 31 March 2010 as follows:

Market Value “As Is” – subject to existing tenancies (i.e. vacant)

100% interest

$90,200,000 (Ninety million, Two Hundred Thousand Dollars ), GST exclusive

Consent

CB Richard Ellis (V) Pty Ltd provides it’s consent for the inclusion of this Summary Letter within the Explanatory Memorandum for the Cromwell Diversified Property Trust (as managed by the Responsible Entity Cromwell Property Securities Limited) making recipients of the Explanatory Memorandum aware of the following liability disclaimers.

Liability Disclaimer

(a) CB Richard Ellis (V) Pty Ltd is not operating under an Australian Financial Services Licence when providing the Full Valuation Report or this Summary Letter and those documents do not constitute financial product advice. Investors should consider obtaining independent advice from their financial advisor before making any investment decisions pertaining to products or funds managed by Cromwell Property Securities Limited.
(b) CB Richard Ellis (V) Pty Ltd disclaims any liability to any person in the event of an omission from, or false and misleading statements included in the Explanatory Memorandum, other than in respect to this Summary Letter and the Full Valuation Report.
(c) The Full Valuation Report and this Summary Letter are strictly limited to the matters contained within those documents and are not to be read as extending, by implication or otherwise, to any other matter in the Explanatory Memorandum. Without limitation to the above, no liability is accepted for any loss, harm, cost or damage (including special, consequential or economic harm or loss) suffered as a consequence of fluctuations in the real estate market subsequent to the date of valuation.
(d) Neither this Summary Letter nor the Full Valuation Report may be reproduced in whole or in part without prior written approval of CB Richard Ellis (V) Pty Ltd.
(e) CB Richard Ellis (V) Pty Ltd charges a professional fee for producing valuation report and the fee paid by Cromwell Property Securities Limited for the Full Valuation Report and this Summary Letter was $22,000 inclusive of GST.

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321 Exhibition Street, Melbourne

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(f) CB Richard Ellis (V) Pty Ltd has prepared the Full Valuation Report and this Summary Letter on the basis of, and limited to, the financial and other information (including market information and third party information) is accurate, reliable and complete and confirm that we have not tested the information in that respect.
(g) This Summary Letter is to be read in conjunction with our Full Valuation Report dated 31 March 2010 and is subject to the Assumptions, Limitations, Disclaimers and Qualifications contained therein. We refer the reader to Cromwell Property Securities Limited to obtain a copy of the full report.
(h) We confirm that the valuer does not have a pecuniary interest that would conflict with a proper valuation of the interest in the property. We do advise that CB Richard Ellis and Colliers International have been jointly appointed as leasing agents for the building.
(i) This document is for the sole use of persons directly provided with it by CB Richard Ellis (V) Pty Ltd. Use by, or reliance upon this document by anyone other than those parties named above is not authorised by CB Richard Ellis (V) Pty Ltd and CB Richard Ellis (V) Pty Ltd is not liable for any loss arising from such unauthorised use or reliance.

Yours sincerely CB Richard Ellis (V) Pty Ltd

Peter Fay Senior Director – Valuation & Advisory Services

321 Exhibition Street, Melbourne

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44 EXPLANATORY MEMORANDUM

4.11 iNDEPENDENT EXPERT’s REPORT

Cromwell Group

Independent expert’s report and Financial Services Guide

04 June 2010

EXPLANATORY MEMORANDUM 45

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46 EXPLANATORY MEMORANDUM

Deloitte Corporate Finance Pty Limited A.B.N. 19 003 833 127 AFSL 241457

Riverside Centre Level 25, 123 Eagle Street Brisbane QLD 4000 GPO Box 1463 Brisbane QLD 4000 Australia

DX 115 Tel: +61 (0) 7 3308 7000 Fax: +61 (0) 7 3308 7003 www.deloitte.com.au

The Directors Cromwell Property Securities Limited as responsible entity for Cromwell Diversified Property Trust, a member of the Cromwell Group Level 19 200 Mary Street Brisbane QLD 4001

4 June 2010

Dear Directors

Independent expert’s report

Introduction

The Cromwell Group is a stapled entity comprising Cromwell Corporation Limited and Cromwell Diversified Property Trust (the Trust). The responsible entity for the Trust is Cromwell Property Securities Limited (CPS). The Trust owns approximately 18% of the units in Cromwell Property Fund (CPF), a managed unlisted scheme for which CPS is also the responsible entity.

On 6 April 2010, the board of directors of CPS announced that CPS, in its capacity as responsible entity for CPF, had undertaken a strategic review of CPF.

As a result of this strategic review, the board of directors of CPS as responsible entity for the Trust (the Directors) have proposed that the Trust will acquire certain property assets (the Properties) from CPF, at a price equal to the recent independent property valuations prepared for the Properties and that the Trust will modify the term and margin of its remaining loan to CPF to match those of the new facility negotiated by CPF with the Exhibition Financier (the Acquisition Proposal).

The Properties to be acquired pursuant to the Acquisition Proposal are as follows:

321 Exhibition Street, Melbourne (Exhibition Street Property)
one third of the Therapeutic Goods Administration complex at Symonston, Canberra (TGA Property) that the Trust does not already own.

Member of Deloitte Touche Tohmatsu

EXPLANATORY MEMORANDUM 47

The consideration offered to CPF (by the Trust) pursuant to the Acquisition Proposal is:

Exhibition Street Property: cash of $80.0 million funded by way of a new three year debt facility provided by a major Australian bank who is the existing financier of the Exhibition Street Property (Exhibition Financier) and a $10.2 million reduction of the existing loan owed to the Trust by CPF, totalling $90.2 million
TGA Property: assumption by the Trust of approximately $13.0 million of existing debt owed to a major Australian bank (TGA Financier) by CPF, and approximately $12.0 million cash, totalling $25.0 million.

The Acquisition Proposal is expected to be completed by 30 June 2010.

Purpose of the report

When the acquisition of a substantial asset from, or disposal of a substantial asset to, a related party is proposed, Chapter 10 of the Listing Rules of the Australian Securities Exchange (ASX) (the Listing Rules) requires the preparation of a report by an independent expert stating whether the proposed transaction is fair and reasonable to securityholders whose votes are not to be disregarded.

The Directors have requested that Deloitte Corporate Finance Pty Limited (Deloitte Corporate Finance) prepare an independent expert’s report advising whether, in our opinion, the Acquisition Proposal is fair and reasonable to holders of the Trust’s ordinary securities whose votes are not to be disregarded (Non-associated Securityholders).

We understand that the Properties qualify as a substantial asset and therefore an independent expert’s report is required pursuant to the Listing Rules in order to assist Non-associated Securityholders in their decision to vote for or against the Acquisition Proposal.

We have prepared this report having regard to the Listing Rules and the relevant Australian Securities and Investments Commission (ASIC) Regulatory Guides, in particular ASIC Regulatory Guide 111 in relation to the content of independent expert’s reports and ASIC Regulatory Guide 74 in relation to acquisitions agreed to by shareholders.

This report is to be included in the explanatory memorandum (the Explanatory Memorandum) accompanying the notice of meeting (the Notice of Meeting) which will be sent to Non-associated Securityholders. This report has been prepared for the exclusive purpose of assisting Non-associated Securityholders in their consideration of the Acquisition Proposal. We are not responsible to you, or anyone else, whether for our negligence or otherwise, if the report is used by any other person for any other purpose.

Basis of evaluation

To assess whether the Acquisition Proposal is fair and reasonable, we have considered the overall effect of the Acquisition Proposal on Non-associated Securityholders and formed a view as to whether the expected benefits of the Acquisition Proposal outweigh any disadvantages that may result as a consequence of the Acquisition Proposal. Value is an important element, but not the only element of this assessment, given the circumstances of the Acquisition Proposal.

In assessing whether the Acquisition Proposal is fair and reasonable we have had regard to the estimated fair market value of the Properties and compared this value with the consideration to be paid by the Trust. We have also considered the other potential advantages and disadvantages to Non-associated Securityholders of undertaking the Acquisition Proposal.

2

Deloitte: Cromwell Diversified Property Trust – Independent expert’s report

48 EXPLANATORY MEMORANDUM

In forming our opinion as to whether the Acquisition Proposal is fair and reasonable, we have treated the concepts of fairness and reasonableness as a single opinion, that is the Acquisition Proposal is, or is not, fair and reasonable.

Summary and conclusion

In our opinion the Acquisition Proposal is fair and reasonable. In arriving at this opinion, we have had regard to the following factors:

Advantages of the Acquisition Proposal

The consideration offered is equivalent to the fair market value of the Properties

Set out in the table below is a comparison of our assessment of the fair market value of the Properties with the consideration offered by the Trust.

Table 1: Comparison of fair market value of the Properties with the consideration offered

		Exhibition Street
		Property	TGA Property
Estimated fair market value of the Properties		$90.2 million	$25.0 million
Consideration offered by the Trust
-	Cash reserves	-	$12.0 million
-	Cash funded by a new debt facility	$80.0 million	-
-	Reduction of existing loan receivable from CPF	$10.2 million	-
-	Assumption of debt	-	$13.0 million
Total	consideration offered per the Acquisition Proposal	$90.2 million	$25.0 million

Source: Cromwell Group, Deloitte Corporate Finance analysis

The consideration offered under the Acquisition Proposal is equivalent to our assessed fair market value of the Properties.

Increased size and scale through acquisition of properties known to Cromwell Group The Acquisition Proposal enables Cromwell Group to increase its size and scale through the acquisition of properties which are already known to the group.

The profile of the Properties is aligned with the investment policy of Cromwell Group which is to invest in commercial, industrial and retail properties.

Cromwell Group is already somewhat familiar with the Properties through its holding of approximately 18% of the units on issue in CPF, its role as manager of CPF and the Properties, and its existing two-thirds investment in the TGA Property. As a consequence, it has not been necessary for Cromwell Group to undertake the same level of due diligence as would have been the case had it been seeking to acquire properties with which it was not as familiar, thus assisting to mitigate transaction costs.

Further, Cromwell Group is acquiring the Properties in a non-competitive process from a willing seller thus minimising any pricing tension which may have arisen through a competitive process.

Deloitte: Cromwell Diversified Property Trust – Independent expert’s report

EXPLANATORY MEMORANDUM 49

The Acquisition Proposal will mitigate the risks associated with the Trust’s investment in CPF

The Trust holds approximately 18% of the units on issue (valued at approximately $7 million[1] ), and is the largest investor, in CPF. The Trust also has a loan receivable from CPF of approximately $30 million as at 31 December 2009.

At inception, CPF had a relatively high level of debt (65%). The primary financing facility of CPF had a loan to value ratio (LVR) bank covenant of 70%. Following the downturn in global financial markets, property asset values declined significantly reducing the value of the CPF property portfolio. This resulted in an increase in the gearing level of CPF from 72% at 30 June 2008 to 87% at 31 December 2009. Based on current gearing levels, CPF would be in breach of its bank LVR covenant, although the Exhibition Financier has to date agreed to defer testing the covenant.

The financial pressure placed on CPF due to the decline in the value of its property portfolio and continued uncertainty regarding property values led CPS, as the responsible entity of CPF, to suspend applications to and withdrawals from CPF in January 2009.

In August 2009, CPF ceased paying distributions to unitholders, and CPS as the responsible entity ceased charging CPF its base annual funds management fee. Accordingly, Cromwell Group has not received distributions or funds management fees from CPF since August 2009.

If the Acquisition Proposal is implemented, it will reduce the gearing level of CPF. This is expected to enable CPF to recommence the distributions to unitholders, including the Trust. The stabilisation of the financial position of CPF will reduce the risk of further decline in the value of the 18% interest the Trust holds in CPF, and enhance the prospect of an orderly repayment of the balance of the loan owed to the Trust by CPF. In addition, the Acquisition Proposal will reduce the loan receivable owing to Cromwell Group by $10.2 million. Once the financial position of CPF stabilises and distributions are recommenced, CPS as the responsible entity of the Trust will reinstate its base annual management fee, albeit at a reduced rate which reflects the new distribution level relative to the original distribution level of 8 cents per security.

In addition to the Trust, a number of securityholders in Cromwell Group are also unitholders in CPF. Management of Cromwell Group consider that should the financial uncertainty surrounding CPF be prolonged, investor confidence in the Cromwell Group could be impaired thus damaging its brand.

Cromwell Group management has indicated that the Acquisition Proposal will assist in protecting Cromwell Group’s brand name in the funds management market.

The debt facilities will be reset

The Exhibition Financier has agreed (subject to credit approval and documentation) to provide a new three year debt facility to the Trust on terms similar to the terms the Trust could negotiate in the current market. The Exhibition Financier has also agreed (subject to credit approval and documentation) to extend the expiry date of the existing CPF loan by 15 months, on completion of the Acquisition Proposal.

1 $0.24 per unit multiplied by 30.0 million units held by the Trust 4

Deloitte: Cromwell Diversified Property Trust – Independent expert’s report

50 EXPLANATORY MEMORANDUM

Pursuant to the Acquisition Proposal, the Trust will agree to modify the term and margin of its remaining loan to CPF to match the new facility negotiated by CPF with the Exhibition Financier. Whilst the margin on this subordinated facility is lower than could be negotiated by CPF in the external debt market due to its current financial position, it is at a higher margin (of approximately 175 basis points) than was offered on the original loan facility from the Trust to CPF.

Cromwell Group will gain 100% of the TGA Property

Pursuant to the Acquisition Proposal, the Trust will acquire the one-third interest in the TGA Property which it does not already own. The Acquisition Proposal will provide the Trust with control of all of the associated revenues and expenses of the TGA Property, subject to the rights and obligations of the lessee.

Disadvantages of the Acquisition Proposal

The Acquisition Proposal will increase the gearing level of the Trust which will impact its capacity to make further acquisitions

The impact of the Acquisition Proposal and the required leasing and refurbishment of the Exhibition Street Property on the financial position of Cromwell Group is set out in section 4.7 of the Explanatory Memorandum.

Upon completion of the Acquisition Proposal, it is estimated the gearing ratio of Cromwell Group will increase from 47.2% as at 31 December 2009, to 53.8%. Cromwell Group’s target gearing level is in the range from 40% to 55%. Whilst this increase in gearing will reduce Cromwell Group’s capacity to make further acquisitions in the short term, we note that there is still some headroom in relation to Cromwell Group’s current LVR covenant of 60%. The majority of the expenditure for the Exhibition Street Property refurbishment and potential lease incentives will not be required until 2011. Cromwell Group will therefore have some time to manage its gearing ratio through initiatives such as the sale of non-core assets, further equity raisings and any potential recovery in property values.

Other matters

Funding requirements prior to the implementation of the Acquisition Proposal

In order to secure a tenant or progress the refurbishment of the Exhibition Street Property, Cromwell Group may be required to contribute funds prior to the Acquisition Proposal being implemented. In the event that the Acquisition Proposal is not implemented, any funding provided by Cromwell Group for these purposes will convert into a loan to CPF, on terms to be determined. It is also likely that the Exhibition Street Property will need to be sold to repay this loan if the Acquisition Proposal is not approved.

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Opinion

In our opinion, the Acquisition Proposal is fair and reasonable to Non-associated Securityholders. An individual’s decision in relation to the Acquisition Proposal may be influenced by his or her particular circumstances. If in doubt an individual should consult an independent adviser.

This opinion should be read in conjunction with our detailed report which sets out our scope and findings.

Yours faithfully

DELOITTE CORPORATE FINANCE PTY LIMITED

Robin Polson Director

Rachel Foley-Lewis Director

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52 EXPLANATORY MEMORANDUM

1	Terms of the Acquisition Proposal	8
1.1	Summary	8
1.2	The Trust’s intentions	8
1.3	Key conditions	8
2	Scope of the report	9
2.1	Purpose of the report	9
2.2	Basis of evaluation	9
2.3	Limitations and reliance on information	11
3	Commercial property industry	12
3.1	Introduction	12
3.2	Australian commercial property market	12
3.3	Market trends and expectations	14
4	Profile of the Properties	18
4.1	Asset ownership structure	18
5	Valuation of the Properties	24
5.1	Overview	24
5.2	Independent valuations of the Properties	24
5.3	Analysis of the independent valuations of the Properties	26
5.4	Assessed fair market value of the Properties	26
6	Evaluation and conclusion	27
6.1	Summary	27
6.2	Opinion	29

Appendices
Appendix 1: Glossary	30
Appendix 2: Sources of information	31
Appendix 3: Qualifications, declarations and consents	32

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1 Terms of the Acquisition Proposal

1.1 Summary

On 6 April 2010, the Directors announced that CPS, in its capacity as responsible entity for CPF, had undertaken a strategic review of CPF. As CPS is the responsible entity for both the Trust and CPF, these entities are considered to be related parties.

As a result of this strategic review, the Directors have proposed that the Trust will acquire the Properties (being the Exhibition Street Property and the TGA Property) from CPF and the Trust will modify the term and margin of its remaining loan to CPF to match the new facility negotiated by CPF with the Exhibition Financier.

The consideration the Trust has offered to CPF for the Properties is as follows:

Exhibition Street Property: cash of $80.0 million funded by way of a new three year debt facility provided by the Exhibition Financier, and a $10.2 million reduction of the existing loan owed to the Trust by CPF, totalling $90.2 million
TGA Property: assumption by the Trust of approximately $13.0 million of existing debt owed to the TGA Financier by CPF, and approximately $12.0 million cash, totalling $25.0 million.

The Acquisition Proposal is expected to occur by 30 June 2010. Full details of the Acquisition Proposal are provided in section 4 of the Explanatory Memorandum.

1.2 The Trust’s intentions

If the Acquisition Proposal is successful:

the Trust will own 100% of the Exhibition Street Property and the TGA Property
the Trust will undertake a refurbishment of the Exhibition Street Property.

The Acquisition Proposal is to be funded by the Trust through a combination of cash, assumption of an existing bank loan facility, a new bank loan facility and a reduction in loans owed to the Trust by CPF.

1.3 Key conditions

The Acquisition Proposal is subject to a number of conditions precedent, including:

approval of the Acquisition Proposal by Non-associated Securityholders by at least 50% of the votes cast (in person or by proxy)
consent from the Exhibition Financier to the restructuring of existing debt facilities into two separate limited recourse facilities with terms acceptable to CPF and the Trust
consent from the TGA Financier to the Trust assuming approximately $13 million of existing debt.

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54 EXPLANATORY MEMORANDUM

2 Scope of the report

2.1 Purpose of the report

When the acquisition of a substantial asset from, or disposal of a substantial asset[2] to, a related party is proposed, the Listing Rules require the preparation of a report by an independent expert stating whether the proposed transaction is fair and reasonable to securityholders whose votes are not to be disregarded.

The Directors have requested that Deloitte Corporate Finance prepare an independent expert’s report advising whether, in our opinion, the Acquisition Proposal is fair and reasonable to Non-associated Securityholders.

We understand that the Properties qualify as a substantial asset and CPF is regarded as a related party of the Trust and therefore our independent expert’s report is required pursuant to the Listing Rules in order to assist Non-associated Securityholders in their decision to vote for or against the Acquisition Proposal.

We have prepared this report having regard to the Listing Rules and the relevant ASIC Regulatory Guides, in particular Regulatory Guide 111 in relation to the content of independent expert’s reports and ASIC Regulatory Guide 74 in relation to acquisitions agreed to by shareholders.

This report is to be included in the Explanatory Memorandum accompanying the Notice of Meeting which will be sent to Non-associated Securityholders.

This report has been prepared for the exclusive purpose of assisting Non-associated Securityholders in their consideration of the Acquisition Proposal. We are not responsible to you, or anyone else, whether for our negligence or otherwise, if the report is used by any other person for any other purpose.

2.2 Basis of evaluation

2.2.1 Guidance

Neither the Listing Rules, nor the Corporations Act 2001 (Cwth) (Corporations Act) provide a definition of ‘fair and reasonable’ for the purposes of ASX Listing Rule 10. In evaluating whether the Acquisition Proposal is fair and reasonable to the Non-associated Securityholders, we have considered the Listing Rules, ASIC Regulatory Guides (in particular Regulatory Guide 111 in relation to independent expert’s reports) and common market practice.

Chapter 10 of the Listing Rules can encompass a wide range of transactions. Accordingly, ‘fair and reasonable’ must be capable of broad interpretation to meet the particular circumstances of each transaction. This involves judgement on the part of the expert as to the alternatives available.

2 According to the Listing Rules, an asset is substantial if its value, or the value of the consideration for it is, or in ASX’s opinion is, equivalent to 5% or more of the equity interests of the entity as set out in the latest accounts given to ASX under the Listing Rules.

The equity interests of an entity is defined as the sum of paid up capital, reserves and accumulated profits or losses, disregarding redeemable preference share capital and outside equity interests, as shown in the consolidated financial statements.

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Regulatory Guide 111 provides guidance in relation to the content of independent expert’s reports prepared for various transactions. It does not provide specific guidance on the form and content of the reports prepared in respect of related party transactions. It provides general guidance that an expert, in deciding the appropriate form of analysis for the report, should ensure that the reasonably anticipated concerns of the people affected by the proposed transaction are adequately dealt with.

We have had regard to the underlying rationale of the requirement of Chapter 10 of the Listing Rules, which is to ensure that, as far as practicable, non-associated securityholders are not disadvantaged as a result of a substantial transaction involving persons that are in a position of influence in the group.

2.2.2 Fair and reasonable

In our opinion the most appropriate basis on which to evaluate whether the Acquisition Proposal is ‘fair and reasonable’ is to consider the overall effect of the Acquisition Proposal on Non-associated Securityholders and to form a judgement as to whether the expected benefits to Non-associated Securityholders outweigh any disadvantages that may result from the Acquisition Proposal. Value is an important element, but not the only element of this assessment, given the circumstances of the Acquisition Proposal.

In forming our opinion as to whether the Acquisition Proposal is fair and reasonable, we have treated the concepts of fairness and reasonableness as a single opinion, that is, the Acquisition Proposal is, or is not, fair and reasonable.

In assessing whether the Acquisition Proposal is fair and reasonable we have compared the consideration being offered by the Trust under the Acquisition Proposal with the fair market value of the Properties. The fair market value of the Properties has been determined with regard to recent independent property valuations undertaken by external property valuers. Fair market value has been defined as the amount at which the Properties would be expected to change hands between a knowledgeable willing buyer and a knowledgeable willing seller, neither of whom is under a compulsion to buy or sell.

Special purchasers may be willing to pay higher prices to reduce or eliminate competition, to ensure a source of material supply or sales, or to achieve cost savings or other synergies arising on business combinations, which could only be enjoyed by the special purchaser. Our consideration of the fair market value of the Properties has not been premised on the existence of a special purchaser.

We have also considered other potential advantages and disadvantages to Non-associated Securityholders of undertaking the Acquisition Proposal.

2.2.3 Individual circumstances

We have evaluated the Acquisition Proposal for Non-associated Securityholders as a whole and have not considered the effect of the Acquisition Proposal on the particular circumstances of individual investors. Due to their particular circumstances, individuals may place a different emphasis on various aspects of the Acquisition Proposal from the one adopted in this report. Accordingly, individuals may reach different conclusions to ours on whether the Acquisition Proposal is fair and reasonable to Non-associated Securityholders. If in doubt an individual should consult an independent adviser.

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56 EXPLANATORY MEMORANDUM

2.3 Limitations and reliance on information

The opinion of Deloitte is based on economic, market and other conditions prevailing at the date of this report. Such conditions can change significantly over relatively short periods of time. This report should be read in conjunction with the declarations outlined in Appendix 3.

This engagement has been conducted in accordance with professional standard APES 225 Valuation Services issued by the Accounting Professional and Ethical Standards Board Limited (APESB).

Our procedures and enquiries did not include verification work nor constitute an audit or a review engagement in accordance with standards issued by the Auditing and Assurance Standards Board (AUASB) or equivalent body and therefore the information used in undertaking our work may not be entirely reliable.

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3 Commercial property industry

3.1 Introduction

The Properties to be acquired as part of the Acquisition Proposal are commercial property assets, and therefore we have presented an overview of the following in this section:

the Australian commercial property market
trends and expectations in the Melbourne and Canberra commercial property markets (being the locations of the Properties).

3.2 Australian commercial property market

3.2.1 Overview

The Australian commercial property market primarily relates to office space leasing and office building leasing. According to the Property Council of Australia, commercial property assets can be classified into the categories outlined below:

Prime/Premium – a landmark office building located in a major Central Business District (CBD) office market, including expansive views, natural lighting, prestige lobby and greater than 30,000 square metres (sqm) in Melbourne and Sydney CBDs, or greater than 20,000 sqm in other CBDs in Australia
A Grade – a high quality space including good views and natural light, good quality lobby and finishes and greater than 10,000 sqm in Sydney and Melbourne CBDs, or greater than 5,000 sqm in other CBDs in Australia
B Grade – quality space with a good standard of finish and maintenance
C Grade – average quality space
D Grade – poor quality space.

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The major business sectors occupying and owning office space in Australia are outlined in the figures below. The largest business sector occupying office space in Australia is property and business services (60%), followed by finance and insurance (15%) and government (15%).

==> picture [383 x 223] intentionally omitted <==

----- Start of picture text -----

Figure 1: Major business sectors occupying office Figure 2: Ownership of prime grade office space in
space in Australia Australia
2% 2%
3%
4%
8%
15% 22% 40%
60%
15%
29%
Property and business services Finance and insurance Financial institution Listed property trust
Government Other Owner occupier/private investor Government
Communications services Developers Other
Source: Office Property Operators in Australia report, Source: Property Council of Australia
IBIS World Pty Limited, 25 January 2010
----- End of picture text -----

According to the Property Council of Australia, the largest owners of prime grade office space in Australia are financial institutions (40%), followed by listed property trusts (29%) and owner occupier and private investors (22%).

Commercial property owners are generally exposed to two forms of earnings:

net passing income, which is the sum of the current rental base, outgoings recoveries and sundry income, less total outgoings expenses (including non-recoverable expenses)
capital value growth (decline), which is the increase (decrease) in market value of the underlying property.

3.2.2 Commercial property market indicators

Following the recent downturn in global financial markets, leasing incentives have become a significant component of lease contracts in order to attract and retain tenants. Incentives refer to free rent periods, fit-out or cash contributions and rental discounts.

Yields are another market indicator for participants in the commercial property market. While there are various methods for calculating yields, in its simplest form a yield is a percentage figure, based on the net passing income divided by the asset value.

Market participants also refer to the vacancy rate of a property, which is the current level of vacancy of a property expressed as a proportion of the net lettable area.

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3.2.3 Key drivers of the commercial property market

The primary demand determinant for commercial property in Australia is growth in white collar employment. Commercial property space is largely occupied by property and business services sectors, which predominantly employ white collar workers (as set out in Figure 1); therefore as businesses expand their labour force, office space requirements typically increase. This strengthens the demand for office space, and therefore often increases rental returns and market values.

White collar employment is directly influenced by corporate profits and underlying economic growth. Heightened economic activity generally improves corporate profits and workforce expansion plans.

Key supply side factors influencing the Australian commercial property market are outlined below:

vacancy levels – low vacancy levels will influence developers to enter the market and supply new property
availability of funding – a shortage of available capital results in lower growth as investment in additional properties is limited
interest rates – low interest rates encourage greater investment in property, hence increasing supply of property assets, as investors shift their funds from cash into property construction and development
rental rates – increased rental rates generally lead to an increase in the supply of commercial property as the return to investors becomes more attractive
costs of construction – fluctuating costs of construction, including materials and labour, will influence the level of commercial property construction, and therefore overall supply.

3.3 Market trends and expectations

3.3.1 Melbourne commercial property market

Market trends

The Melbourne commercial property tenant market largely comprises the government and community sector (26%), the property and business services sector (24%) and the finance and insurance sector (15%)[3] .

Leasing demand has improved significantly following the downturn in financial markets. White collar employment growth has occurred as a result of improving economic conditions, with growth of 0.4% for the six months to January 2010, compared to -0.5% over the previous six months[4] . Given the large proportion of white collar employment concentrated in the Melbourne CBD, this has strengthened demand for office space.

3 Savills Research, Spotlight on Melbourne CBD Office, March 2010

4 Colliers International Market Indicators Report Melbourne CBD Office, Autumn 2010 14

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Prior to the downturn in financial markets, the Melbourne CBD experienced a significant increase in new supply coming online. However, a lack of funding caused a decline in office property construction, resulting in vacancy rates reaching record lows of 3.1% in July 2008[5] . The vacancy rate for commercial property in Melbourne was 6.6% as at March 2010, which increased from 4.8% as at 31 January 2009[6] .

The combination of low vacancy rates and improving tenant demand has resulted in net rents for Premium and A-Grade property increasing 3.0% in the six months to 31 March 2010[7] .

Following the downturn in financial markets, the level of sales activity in Melbourne’s commercial property market also declined, however activity has started to return. In the twelve months to 31 December 2009, 23 commercial property sales occurred with a total transaction value of $942 million[8] . During this period, private (39%) and foreign investors (24%) accounted for the majority of purchaser activity[9] . Activity by Australian Real Estate Investment Trusts (A-REITs), which accounted for a significant proportion of acquirers prior to the downturn in financial markets, remains subdued.

Details of current Melbourne CBD commercial market indicators are outlined in Table 2.

Table 2: Melbourne CBD Office market indicators, March 2010

			Average net
			face rents		Average
		Vacancy	($/sqm per annum)	Net incentives	capital values ($/sqm)		Average yield (%)
	Stock	rate		range
Grade	(sqm)	(%)	Low High	(%)	Low	High	Low	High
Premium	599,641	10.6	403 607	15 - 20	5,750	6,500	6.75	7.25
A Grade	1,738,658	4.5	357 416	20 - 22	4,500	5,250	7.50	8.25
B Grade	938,144	8.0	276 304	20 - 25	3,000	3,500	8.50	9.25
Total	3,994,626	6.6	- -	-	-	-	-	-

Source: Colliers International Melbourne CBD office market indicators, Autumn 2010

Market expectations

Economic indicators are expected to improve over the medium term. The Reserve Bank of Australia has projected year on year gross domestic product growth to increase from 1.33% in 2009, to 3.5% in 2012[10] . As a result, corporate profits are likely to increase, causing a rise in white collar employment. Coupled with an expected undersupply of office space in 2012 and 2013, strong rental demand is forecast for the Melbourne commercial property market.

Vacancy rates in the Melbourne commercial property market are expected to peak at 8.2% in mid 2011, as a result of a backlog of office space coming onto the market[11] .

5 Knight Frank, Australian CBD Office Market Overview, October 2008

6 Savills Research, Spotlight on Melbourne CBD Office, March 2010

7 Colliers International Market Indicators Report Melbourne CBD Office, Autumn 2010

8 Savills Research, Spotlight on Melbourne CBD Office, March 2010 9 ibid

10 Bloomberg Financial Markets, 12 April 2010

11 Colliers International Market Indicators Report Melbourne CBD Office, Autumn 2010

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Following the recapitalisation of many A-REITS in 2009, a number of them are now starting to re-enter the market. With lower funding costs, and the availability of debt improving since the downturn in global financial markets, investment activity by A-REITS is likely to increase[12] .

3.3.2 Canberra property market

Market trends

Government and government related industry dominate the commercial property market in Canberra, accounting for 95% of pre-leased space[13] . Generally, public sector tenancies are long term and considered to have less chance of default relative to the corporate sector. As a result, following the recent downturn in global financial markets, the commercial property market in Canberra has experienced a less pronounced impact than other locations in Australia.

The weakening of the market caused A Grade yields to increase by an average of 160 basis points in the 18 months to December 2009 in Canberra[14] . With several asset sales in 2009 and the first quarter of 2010, there appears to be improved investor confidence in the Canberra market.

The significant fiscal stimulus packages released by the Federal Government following the downturn, and the ensuing administration of these stimulus packages, has resulted in staff increases and a less severe rise in vacancy rates in the Canberra commercial property market compared to other capital cities[15] .

Vacancy levels had reached record lows of 1.7% in July 2007[16] . The downturn in global financial markets, although mitigated by increases in government employment levels, and new supply coming onto the market as a result of the Commonwealth replacement program initiative[17] , has resulted in a current vacancy rate of 8.7% as at January 2010[18] .

Details of current Canberra CBD commercial market indicators are outlined in Table 3.

Table 3: Canberra CBD Office market indicators, March 2010

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----- Start of picture text -----

Average gross face Average capital
rents ($/sqm per Net values Average yield
annum) incentives ($/sqm) (%)
range
Grade Precinct Low High (%) Low High Low High
A CBD 410 450 5-10 5,500 6,500 7.0 7.25
----- End of picture text -----

Source: Colliers International Canberra CBD office market indicators, Autumn 2010

12 Colliers International Market Indicators Report Melbourne, Autumn 2010 13 Colliers International Market Indicators Report Canberra, Autumn 2010

14 BIS Shrapnel Canberra Commercial Property 2009 - 2019

15 ibid

16 Colliers International Market Indicators Report Canberra, Autumn 2010 17 BIS Shrapnel Canberra Commercial Property 2009 - 2019

18 ibid

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One of the key outcomes of a significant level of new supply entering the market has been a widening gap in capital values and net income profiles of buildings that satisfy the standards of Commonwealth Green ratings, and those which do not. This has resulted in a two tiered market, with highly rated buildings commanding a premium regardless of age and grade.

Market expectations

Rental demand in the commercial property market in Canberra is expected to improve over the short to medium term for the following reasons:

the faster than expected economic recovery is likely to increase expectations of Commonwealth revenue, and therefore have positive implications for workforce growth. Over the three months to June 2010, Hudson[19] predicts that 26.3% of employers in the Australian Capital Territory (ACT) will be hiring additional employees due to the demand for policy and program staff to develop and administer infrastructure policies. This is above the national sector average of 19.7%[20]
some Government departments are projected to outgrow existing premises and are likely to relocate in the short to medium term. Relocation plans were deferred during the recent downturn, and as a result there is currently pent-up demand in the market
Commonwealth Government requirements for high Green rated premises is also likely to increase demand for office space in Canberra relative to other capital cities in Australia.

These factors are likely to translate into improved tenant demand in Canberra with Prime grade office demand growth expected to be 2% to 3% in the short term, before increasing to 3% to 4.5% in the medium term[21] . However, the level of new supply coming online in the period to 2013 could outweigh these demand side factors, and result in increased vacancy rates. Accordingly, notwithstanding the overall positive demand outlook, BIS Shrapnel predicts property owners may be required to increase leasing incentives by up to 15% on a ten year lease, which may cause gross effective rents to decrease by 11.4% over the period from 2009 to 2011[22] . As a result, commercial property values are projected to weaken as a result of rising vacancies and falling gross rents, causing average A Grade yields to weaken to 8% between 2009 and 2012[23] . Properties with long term Government tenancies and high Green rated buildings are expected to retain their value in the medium to long term.

19 The Hudson Report, Employment and HR Trends, Australia, April - June 2010 20 ibid

21 Colliers International Market Indicators Report Canberra, Autumn 2010

22 BIS Shrapnel Canberra Commercial Property 2009 - 2019 23 ibid

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EXPLANATORY MEMORANDUM 63

4 Profile of the Properties

This section describes the relevant entities and Properties pursuant to the Acquisition Proposal.

4.1 Asset ownership structure

The figure below sets out a simplified ownership structure of the Properties.

Figure 3: Simplified ownership structure of the Properties

==> picture [370 x 235] intentionally omitted <==

----- Start of picture text -----

Cromwell Property
Securities Limited
(CPS)
Responsible entity
Cromwell Group
Cromwell
Cromwell Diversified 18% interest Cromwell
Corporation Property Fund
Limited Property Trust (CPF)
(the Trust)
one-third 100%
two-thirds TGA Exhibition
Street
----- End of picture text -----

Source: Cromwell website

A brief description of each of the above entities and the Properties is set out below.

4.1.1 CPS

CPS is an unlisted public company, and is the responsible entity of the Trust and CPF. CPS is also responsible for funds management and raising capital for the group’s investment products. CPS is 100% owned by Cromwell Corporation Limited.

4.1.2 The Cromwell Group

The Cromwell Group is a stapled entity comprising Cromwell Corporation Limited and the Trust, which listed on the ASX on 12 December 2006. Cromwell Corporation Limited had been listed since 1972.

The operations of Cromwell Group primarily relate to property investment and management, the promotion and management of property related managed investment schemes and property development. As at 31 December 2009, the Cromwell Group held an investment property portfolio valued at $1.12 billion, which comprised commercial (14), industrial (5) and retail (4) properties throughout Australia (including the two-thirds interest in the TGA Property).

18

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Key factors pertaining to the property portfolio of the Cromwell Group are set out below.

Table 4: Cromwell Group portfolio indicators

	Value of	portfolio	portfolio	Weighted average	Weighted average	Weighted average	Weighted average	Weighted average
	by sector			capitalisation rate		lease term			Occupancy
	(%)			(%)		(years)			(%)
	30 Jun	31	Dec	30 Jun	31 Dec	30 Jun	31	Dec	30 Jun	31 Dec
Sector	2009	2009		2009	2009	2009	2009		2009	2009
Commercial	85.7		84.3	8.2	8.4	5.4		5.1	99.6	98.9
Industrial	11.1		11.2	9.1	9.6	3.1		2.1	100.0	100.0
Retail/Entertainment	3.2		4.5	10.5	9.3	5.1		4.6	100.0	100.0
Total	100.0	100.0		8.4	8.5	5.1		4.7	99.8	99.1

Source: Cromwell Group half year financial report 31 December 2009

Note:

Excludes the two-thirds interest in the TGA Property

The Cromwell Group is predominantly exposed to the commercial property market, which accounted for 86% ($967.5 million) of its portfolio value as at 31 December 2009. The property portfolio of the Cromwell Group is geographically diversified, with property assets in Victoria accounting for 29.8% of portfolio value, followed by ACT (26.6%) and Queensland (19.5%), as set out in the figure below.

Figure 4: Geographic diversification by value of Cromwell Group property portfolio

==> picture [278 x 214] intentionally omitted <==

----- Start of picture text -----

3.1% 0.7%
7.6%
29.8%
12.7%
19.5%
26.6%
Victoria Australian Capital Territory
Queensland New South Wales
South Australia Tasmania
Western Australia
----- End of picture text -----

Source: Cromwell Property Portfolio Booklet, 31 December 2009

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A summary of the historical consolidated balance sheets of Cromwell Group has been outlined in the table below.

Table 5: Historical Cromwell Group consolidated balance sheet

	As at	As at	As at
	30 June 2008	30 June 2009	31 December 2009
	$’000	$’000	$’000
Current assets	82,880	93,318	139,558
Investment properties	1,120,716	1,117,175	1,074,200
Other non-current assets	164,927	98,330	94,086
Total assets	1,368,523	1,308,823	1,307,844
Current borrowings	475,316	81,201	3,321
Other current liabilities	29,562	46,017	46,363
Non-current borrowings	148,132	641,647	669,152
Other non-current liabilities	277	365	403
Total liabilities	653,287	769,230	719,239
Net assets	715,236	539,593	588,605
Net Tangible Assets per security ($)	1.01	0.76	0.73
Gearing	44%	53%	47%

Source: Cromwell Group annual report 2009, Cromwell Group half year financial report 31 December 2009

4.1.3 CPF

The Trust holds approximately 18% interest in, and is the largest unitholder of, CPF. CPF’s mandate is to invest in commercial, industrial and other non-residential property in order to provide unitholders with a diversified, stable income stream. As at 31 December 2009, CPF held an investment property portfolio valued at $369 million, with 60% of the property portfolio value relating to commercial property, 28% of the property portfolio relating to retail/bulk goods property and 12% relating to industrial property (including the one-third interest in the TGA Property).

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Key factors pertaining to CPF’s property portfolio are set out below.

Table 6: CPF portfolio indicators

	Value of portfolio	Value of portfolio	Value of portfolio	Weighted average	Weighted average	Weighted average	Weighted average
	by	sector		capitalisation rate		lease	term	Occupancy
		(%)			(%)	(years)			(%)
	30 Jun	31	Dec	30 Jun	31 Dec	30 Jun	31 Dec	30 Jun	31 Dec
Sector	2009	2009		2009	2009	2009	2009	2009	2009
Commercial	62.7		60.9	8.1	8.5	3.0	2.5	99.3	99.3
Industrial	30.1		31.9	8.6	8.4	4.2	4.4	87.7	89.8
Retail/Entertainment	7.2		7.2	9.5	9.5	3.1	2.7	97.0	97.3
Total	100.0	100.0		8.4	8.5	3.3	3.1	95.5	96.1

Source: CPF half year financial report 31 December 2009

Note:

Excludes the one-third interest in the TGA Property

A summary of the historical consolidated balance sheets of CPF has been outlined in the table below.

Table 7: Historical CPF consolidated balance sheet

	As at	As at	As at
	30 June 2008	30 June 2009	31 December 2009
	$’000	$’000	$’000
Current assets	30,468	17,654	18,410
Investment property	391,038	323,300	344,056
Other non-current assets	56,718	53,359	31,365
Total assets	478,224	394,313	393,831
Current borrowings	62,471	330,714	330,948
Other current liabilities	7,919	11,247	9,938
Non-current borrowings	285,338	12,941	12,950
Total liabilities	355,728	354,902	353,836
Net assets	122,496	39,411	39,995
Net Tangible Assets per security ($)	0.72	0.23	0.23
Gearing	72%	87%	87%

Source: CPF annual report 2009, CPF half year financial report 31 December 2009

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EXPLANATORY MEMORANDUM 67

4.1.4 Exhibition Street Property

The Exhibition Street Property is located at 321 Exhibition Street, on the north-eastern fringe of the Melbourne CBD. The building, which was constructed in 1990, is primarily designated as a commercial/office property with retail floor space located on the ground floor.

The Exhibition Street Property has the following attributes:

Table 8: Exhibition Street Property details

Property Description

Location	321 Exhibition Street, Melbourne
Sector	Commercial
Grade	A Grade office
Major tenant	Vacant
Market value ($)	$90.2 million as at 31 March 2010
Net lettable area	30,918 square metres
Features	� 18 levels of office accommodation
	� ground level foyer and lobby space, with retail accommodation at
	the Exhibition and Latrobe Street frontages
	� single level of basement car parking with 54 spaces
Age of premises	20 years (1990)

Source: Exhibition Street Property valuation by CBRE dated 31 March 2010

The Exhibition Street Property is currently vacant as the previous tenant, Australia Post, ceased its rental contract on 28 February 2010, after notifying CPF of its intentions to vacate in 2007. CPF has had discussions with a number of prospective tenants. In this regard, CPF entered into a non-binding heads of agreement in April 2010 with a major ASX listed entity in relation to the prospective tenancy of approximately 24,000 sqm. A binding agreement for a substantial portion of the building is expected to be executed with this tenant by June 2010.

In order to maintain its high A grade office rating and attract quality corporate and government tenants, the Exhibition Street Property requires refurbishment due to the age and condition of the building. Current refurbishment plans indicate this process will take 12 months from commencement with an additional two months for tendering and contract administration, at a cost of approximately $32 million including interest and holding costs but excluding leasing commissions and incentives. In order to secure a cornerstone tenant, the owners of the Exhibition Street Property will be required to offer significant lease incentives, or lease rental reductions.

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68 EXPLANATORY MEMORANDUM

4.1.5 TGA Property

The TGA Property is located at 136 Narrabundah Lane at Symonston, approximately eight kilometres from the Canberra CBD. The building is a purpose built two storey facility comprising eight wings, situated on a 17.35 hectare site. The majority of the building was constructed between 1989 and 1992, with an additional office accommodation wing (Block G) constructed in 1997.

The TGA Property has the following attributes:

Table 9: TGA Property details

Property Description
Location	136 Narrabundah Lane, Symonston, ACT
Sector	Commercial
Grade	A Grade
Major tenant	Commonwealth of Australia (sublease) – TGA
Lease term	15 years commencing 21 June 2002
Lease structure	Annual rent increases are the greater of consumer price index (CPI) and
	3%. Market reviews occur triennially.
Market value ($)	$75.0 million
Net lettable area	18,526.6 square metres
Features	� office space
	� laboratories
	� minor storage
	� 371 car parking spaces
Age of premises	18 years (1992)

Source: TGA Property valuation by Colliers dated 31 March 2010

CPF acquired a one-third interest in the TGA Property on 4 December 2007. The remainder of the TGA Property is owned by the Trust.

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5 Valuation of the Properties

5.1 Overview

CPSL as responsible entity for Cromwell DPT engaged independent property valuers, CB Richard Ellis (V) Pty Limited (CBRE) and Colliers International Consultancy & Valuation Pty Ltd (Colliers), to estimate the market value of the Exhibition Street Property and the TGA Property, respectively, as at 31 March 2010. A summary of the property valuation reports prepared by CBRE and Colliers are included in section 4.10 and 4.9 of the Explanatory Memorandum, respectively.

Whilst we did not directly control the scope of the valuations undertaken by CBRE or Colliers, we consider the terms of CBRE and Colliers’ engagement to be consistent with the requirements of ASIC Regulatory Guide 112 in relation to the independence of experts and the use of specialists. We have obtained the written consent of CBRE and Colliers to refer to the independent property valuation reports in the independent expert’s report.

On this basis, we have had regard to the independent property valuations in our assessment of the fair market value of the Properties.

For the purpose of our opinion, fair market value is defined as the amount at which the Properties would change hands between a knowledgeable willing buyer and a knowledgeable willing seller, neither being under a compulsion to buy or sell. We have not considered special value in this assessment. We consider the market value approach adopted by CBRE and Colliers is consistent with our definition of fair market value.

Having regard to the policy intent of ASIC Regulatory Guide 111 in relation to the content of independent expert’s reports, when assessing the fair market value of the Properties we have not had regard to any entity specific or structural issues such as excess gearing which may temporarily impair an entity’s ability to realise full fair market value for its assets. Instead, we have assumed an orderly market for the Properties.

5.2 Independent valuations of the Properties

5.2.1 Summary

A summary of the market values of the Exhibition Street Property and the TGA Property, as determined by the independent property valuers CBRE and Colliers respectively, as at 31 March 2010, is set out in Table 10 below.

Table 10: Fair market values derived by the independent property valuers as at 31 March 2010

		Valuation
	Exhibition Street Property (100% interest)	$90.2 million
	TGA Property (one-third interest)1	$25.0 million
	Source: CBRE, Colliers
	Note:

Based on one-third of the total property valuation for the TGA Property of $75 million (refer Section 5.2.3)

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5.2.2 Valuation of the Exhibition Street Property

CBRE considered two valuation approaches, the capitalisation approach and the discounted cash flow approach, to arrive at their opinion of the market value on an ‘as is’ basis subject to existing tenancies (i.e. vacant) for the Exhibition Street Property as at 31 March 2010.

The key assumptions utilised by CBRE in its valuation, are set out in section 4.10 of the Explanatory Memorandum and summarised below:

the estimated total income (both on a contract rental basis and a face market rental basis) has been adjusted to reflect anticipated operating costs and potential future income from existing vacancies to produce a net income on a fully leased basis. CBRE has assumed a fully leased net income amount of $12.4 million
the fully leased net income was capitalised into perpetuity at a yield of 8.0%, which CBRE considers to reflect the nature, location and tenancy profile of the Exhibition Street Property
CBRE applied capital adjustments to the value of the Exhibition Street Property for items such as refurbishment expenditure (and rental shortfall), vacancy during refurbishment period and leasing incentives to secure a new tenant. The total amount of capital adjustments included by CBRE in its valuation of the Exhibition Street Property were approximately $66.6 million
CBRE has discounted the cash flows attributable to the Exhibition Street Property at an internal rate of return of 10%, with a terminal yield of 8.25%.

5.2.3 Valuation of the TGA Property

Colliers considered two valuation approaches, the capitalisation approach and the discounted cash flow approach, to arrive at their opinion of the current market value for the TGA Property as at 31 March 2010.

The key assumptions utilised by Colliers in its valuation are set out in section 4.9 of the Explanatory Memorandum and summarised below:

a potential fully leased net income amount of $5.6 million
the adopted fully let net income was capitalised into perpetuity from the valuation date at a yield of 8.5%
Colliers applied adjustments to the capitalised value of the TGA Property for the tenant’s additional contribution towards fit out of $1.8 million per annum until 30 June 2016 and projected capital expenditure for 12 months which total approximately $9.3 million
Colliers has discounted the cash flows attributable to the TGA Property at an internal rate of return of 9.5%, with a terminal yield of 8.85% on an initial basis.

We note that the TGA Property is currently two-thirds owned by the Trust and one third owned by CPF. Unless specific terms apply to the agreements regulating common ownership, it is market practice to assess the value of an interest in a property based on the pro-rata portion of the total property value, without applying any further adjustments or discounts. Therefore, we do not consider it necessary to allow for any discount to the full pro-rata share of the fair market value of the TGA Property in our assessment of the fair market value of CPF’s interest in the TGA Property.

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5.3 Analysis of the independent valuations of the Properties

We have undertaken an analysis of the independent valuations of Properties, as at 31 March 2010. Based on our analysis, we have concluded that:

the external property valuers are independent from CPS, as responsible entity for the Trust and CPF
there were no restrictions on the scope provided to the external property valuers by CPS as responsible entity for the Trust
the independent property valuation reports were prepared by professionals who have sufficient qualifications and competence to provide an informed opinion of the fair market value of assets of this nature
the valuation methods used in the property valuations are not inappropriate and appear to have been correctly applied to estimate the fair market values of the Properties
the assumptions and valuation metrics used do not appear unreasonable or inappropriate for the purpose of estimating the fair market values of the Properties
nothing has come to our attention that may cause us to make an adjustment for valuation movements since 31 March 2010. Subsequent to the preparation of the independent property valuation of the Exhibition Street Property as at 31 March 2010, Cromwell Group has entered into a non-binding heads of agreement with a major tenant. The terms of this agreement are not inconsistent with the assumptions adopted in the independent valuation and therefore we do not consider this agreement will have a material impact on the valuation of the Exhibition Street Property.

5.4 Assessed fair market value of the Properties

Based on the above, we consider the independent property valuations to be a reasonable basis for the assessment of the fair market value of the Properties. Our assessment of the fair market value of the Exhibition Street Property and the TGA Property is set out in the table below.

Table 11: Deloitte assessed fair market values of the Properties

	Valuation
Exhibition Street Property (100% interest)	$90.2 million
TGA Property (one-third interest)	$25.0 million

Source: Deloitte Corporate Finance analysis

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6 Evaluation and conclusion

6.1 Summary

In our opinion the Acquisition Proposal is fair and reasonable. In arriving at this opinion, we have had regard to the following factors:

6.1.1 Advantages of the Acquisition Proposal

The consideration offered is equivalent to the fair market value of the Properties

Set out in the table below is a comparison of our assessment of the fair market value of the Properties with the consideration offered by the Trust.

Table 12: Comparison of fair market value of the Properties with the consideration offered

		Exhibition Street
		Property	TGA Property
Estimated fair market value of the Properties		$90.2 million	$25.0 million
Consideration offered by the Trust
-	Cash reserves	-	$12.0 million
-	Cash funded by a new debt facility	$80.0 million	-
-	Reduction of existing loan receivable from CPF	$10.2 million	-
-	Assumption of debt	-	$13.0 million
Total	consideration offered per the Acquisition Proposal	$90.2 million	$25.0 million

Source: Cromwell Group, Deloitte Corporate Finance analysis

The consideration offered under the Acquisition Proposal is equivalent to our assessed fair market value of the Properties.

Increased size and scale through acquisition of properties known to Cromwell Group

The Acquisition Proposal enables Cromwell Group to increase its size and scale through the acquisition of properties which are already known to the group.

The profile of the Properties is aligned with the investment policy of Cromwell Group which is to invest in commercial, industrial and retail properties.

Further, Cromwell Group is acquiring the Properties in a non-competitive process from a willing seller thus minimising any pricing tension which may have arisen through a competitive process.

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EXPLANATORY MEMORANDUM 73

The Acquisition Proposal will mitigate the risks associated with the Trust’s investment in CPF

The Trust holds approximately 18% of the units on issue (valued at approximately $7 million[24] ), and is the largest investor, in CPF. The Trust also has a loan receivable from CPF of approximately $30 million as at 31 December 2009.

At inception, CPF had a relatively high level of debt (65%). The primary financing facility of CPF had a LVR bank covenant of 70%. Following the downturn in global financial markets, property asset values declined significantly reducing the value of the CPF property portfolio. This resulted in an increase in the gearing level of CPF from 72% at 30 June 2008 to 87% at 31 December 2009. Based on current gearing levels, CPF would be in breach of its bank LVR covenant, although the Exhibition Financier has to date agreed to defer testing the covenant.

In August 2009, CPF ceased paying distributions to unitholders, and CPS as the responsible entity ceased charging CPF its base annual funds management fee. Accordingly, the Cromwell Group has not received distributions or funds management fees from CPF since August 2009.

Cromwell Group management has indicated that the Acquisition Proposal will assist in protecting Cromwell Group’s brand name in the funds management market.

The debt facilities will be reset

24 $0.24 per unit multiplied by 30.0 million units held by the Trust

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74 EXPLANATORY MEMORANDUM

Cromwell Group will gain 100% of the TGA Property

6.1.2 Disadvantages of the Acquisition Proposal

The Acquisition Proposal will increase the gearing level of the Trust which will impact its capacity to make further acquisitions

6.1.3 Other matters

Funding requirements prior to the implementation of the Acquisition Proposal

6.2 Opinion

In our opinion, the Acquisition Proposal is fair and reasonable to the Non-associated Securityholders. An individual’s decision in relation to the Acquisition Proposal may be influenced by his or her particular circumstances. If in doubt an individual should consult an independent adviser.

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EXPLANATORY MEMORANDUM 75

Appendix 1: Glossary

Reference	Definition
$	All amounts in this report are stated in Australian dollars unless otherwise
	stated, and may be subject to rounding
ACT	Australian Capital Territory
APESB	Accounting Professional and Ethical Standards Board
Acquisition Proposal, the	Acquisition of the Properties by The Trust from CPF
A-REITs	Australian Real Estate Investment Trusts
ASIC	Australian Securities and Investments Commission
ASX	Australian Securities Exchange
AUASB	Auditing and Assurance Standards Board
CBD	Central business district
CBRE	CB Richard Ellis (V) Pty Limited
Colliers	Colliers International Consultancy & Valuations Pty Ltd
Corporations Act	Corporations Act 2001 (Cwth)
CPF	Cromwell Property Fund, a related party to Cromwell Group
CPI	Australian Consumer Price Index
CPS	Cromwell Property Securities Limited
Deloitte Australia	Deloitte member firm in Australia
Deloitte Corporate Finance	Deloitte Corporate Finance Pty Limited
Directors, the	The directors of Cromwell Property Securities Limited as responsible
	entity for the Trust
Exhibition Street Property	Property located at 321 Exhibition Street, Melbourne
Exhibition Financier	Major Australian bank to whom debt is owed in relation to the Exhibition
	Street Property
Explanatory Memorandum, the	The Explanatory Memorandum to be sent to securityholders setting out
	details of the Acquisition Proposal
FOS	Financial ombudsman service
FSG	Financial services guide
Listing Rules, the	Listing Rules of the Australian Securities Exchange
LVR	Loan to value ratio
Non-associated Securityholders	Holders of Cromwell Group’s ordinary securities whose votes are not to
	be disregarded
Notice of Meeting	Notice of meeting
Properties, the	Exhibition Street Property and TGA Property
Sqm	Square metre
TGA Financier	Major Australian bank to whom debt is owed in relation to the TGA
	Property
TGA Property	The Therapeutic Goods Administration complex at Symonston, Canberra
Trust, the	Cromwell Diversified Property Trust

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Appendix 2: Sources of information

In preparing this report we have had access to the following principal sources of information:

Exhibition Street Property valuation, prepared by CBRE, dated 31 March 2010
TGA Property valuation, prepared by Colliers, dated 31 March 2010
Cromwell Group Acquisition Proposal briefing paper, March 2010
the Cromwell Group annual report for the year ended 30 June 2009
the Cromwell Group half year financial report for the six month period ended 31 December 2009
the CPF annual report for the year ended 30 June 2009
the CPF half year financial report for the six month period ended 31 December 2009
the Cromwell Group Property Portfolio Booklet as at 31 December 2009
Cromwell Group company website
draft Explanatory Memorandum and Notice of Meeting
publicly available information regarding Cromwell Group, CPF and the commercial property industry in Australia as published by various industry sources such as Colliers and Savills Research, IBIS World Pty Limited and Bloomberg Financial markets.

In addition, we have had discussions and correspondence with certain directors and executives of Cromwell Group in relation to the above information and to current operations and prospects.

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Appendix 3: Qualifications, declarations and consents

The report has been prepared at the request of the Directors of CPS as responsible entity for the Trust and is to be included in the Explanatory Memorandum accompanying the Notice of Meeting to be given to Non-associated Securityholders in relation to the Acquisition Proposal. Accordingly, it has been prepared only for the benefit of the Directors and those persons entitled to receive the Explanatory Memorandum and Notice of Meeting in their assessment of the Acquisition Proposal outlined in the report and should not be used for any other purpose. We are not responsible to you, or anyone else, whether for our negligence or otherwise, if the report is used by any other person for any other purpose. Further, recipients of this report should be aware that it has been prepared without taking account of their individual objectives, financial situation or needs. Accordingly, each recipient should consider these factors before acting on the Acquisition Proposal. This engagement has been conducted in accordance with professional standard APES 225 Valuation Services issued by the APESB.

The report represents solely the expression by Deloitte Corporate Finance of its opinion as to whether the Acquisition Proposal is fair and reasonable, having regard to the Listing Rules and the relevant ASIC Regulatory Guides.

Statements and opinions contained in this report are given in good faith but, in the preparation of this report, Deloitte Corporate Finance has relied upon the completeness of the information provided by Cromwell Group and its officers, employees, agents or advisors which Deloitte Corporate Finance believes, on reasonable grounds, to be reliable, complete and not misleading. Deloitte Corporate Finance does not imply, nor should it be construed, that it has carried out any form of audit or verification on the information and records supplied to us. Drafts of our report were issued to Cromwell Group management for confirmation of factual accuracy.

In recognition that Deloitte Corporate Finance may rely on information provided by the Cromwell Group and its officers, employees, agents or advisors, the Cromwell Group has agreed that it will not make any claim against Deloitte Corporate Finance to recover any loss or damage which the Cromwell Group may suffer as a result of that reliance and that it will indemnify Deloitte Corporate Finance against any liability that arises out of either Deloitte Corporate Finance’s reliance on the information provided by the Cromwell Group and its officers, employees, agents or advisors or the failure by Cromwell Group and its officers, employees, agents or advisors to provide Deloitte Corporate Finance with any material information relating to the Acquisition Proposal.

Deloitte Corporate Finance also has had regard to the valuation reports prepared by CBRE and Colliers. Deloitte Corporate Finance has received consent from each expert to be named in this report.

To the extent that this report refers to prospective financial information we have considered the prospective financial information and the basis of the underlying assumptions. The procedures involved in Deloitte Corporate Finance’s consideration of this information consisted of enquiries of Cromwell Group personnel and analytical procedures applied to the financial data. These procedures and enquiries did not include verification work nor constitute an audit or a review engagement in accordance with standards issued by the AUASB or equivalent body and therefore the information used in undertaking our work may not be entirely reliable.

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Based on these procedures and enquiries, Deloitte Corporate Finance considers that there are reasonable grounds to believe that the prospective financial information for Cromwell Group included in this report has been prepared on a reasonable basis. In relation to the prospective financial information, actual results may be different from the prospective financial information of Cromwell Group referred to in this report since anticipated events frequently do not occur as expected and the variation may be material. The achievement of the prospective financial information is dependent on the outcome of the assumptions. Accordingly, we express no opinion as to whether the prospective financial information will be achieved.

Deloitte Corporate Finance holds the appropriate Australian Financial Services Licence to issue this report and is owned by the Australian Partnership Deloitte Touche Tohmatsu. The employees of Deloitte Corporate Finance principally involved in the preparation of this report were Robin Polson, B.Comm, Grad.Dip.App.Fin, Rachel Foley-Lewis, B.Comm., CA, F.Fin and Renee Daus, B.Comm, CA, M. App Fin. Robin and Rachel are Directors and Renee is an Associate Director of Deloitte Corporate Finance. Each has many years experience in the provision of corporate financial advice, including specific advice on valuations, mergers and acquisitions, as well as the preparation of expert reports.

Neither Deloitte Corporate Finance, Deloitte Touche Tohmatsu, nor any partner or executive or employee thereof has any financial interest in the outcome of the Acquisition Proposal which could be considered to affect our ability to render an unbiased opinion in this report. Deloitte will receive a fee of $50,000 exclusive of GST in relation to the preparation of this report. This fee is based upon time spent at our normal hourly rates and is not contingent upon the success or otherwise of the Acquisition Proposal.

Consent to being named in disclosure document

Deloitte Corporate Finance Pty Limited (ACN 003 833 127) of 123 Eagle Street, Brisbane QLD 4000 acknowledges that:

Cromwell Property Securities Limited, as responsible entity for the Cromwell Diversified Property Trust proposes to issue an explanatory memorandum in respect of the Acquisition Proposal between the Trust and Cromwell Property Fund
the Explanatory Memorandum will be issued in hard copy and be available in electronic format
it has previously received a copy of the draft explanatory memorandum (Draft Explanatory Memorandum) for review
it is named in the Explanatory Memorandum as the ‘independent expert’ and the Explanatory Memorandum includes its independent expert’s report in section 4.11 of the Explanatory Memorandum.

On the basis that the Explanatory Memorandum is consistent in all material respects with the Draft Explanatory Memorandum received, Deloitte Corporate Finance Pty Limited consents to it being named in the Explanatory Memorandum in the form and context in which it is so named, to the inclusion of its independent expert’s report in section 4.11 of the Explanatory Memorandum and to all references to its independent expert’s report in the form and context in which they are included, whether the Explanatory Memorandum is issued in hard copy or electronic format or both.

Deloitte Corporate Finance Pty Limited has not authorised or caused the issue of the Explanatory Memorandum and takes no responsibility for any part of the Explanatory Memorandum, other than any references to its name and the independent expert’s report as included in section 4.11. 33

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About Deloitte

In Australia, Deloitte has 12 offices and over 4,500 people and provides audit, tax, consulting, and financial advisory services to public and private clients across the country. Known as an employer of choice for innovative human resources programs, we are committed to helping our clients and our people excel. Deloitte's professionals are dedicated to strengthening corporate responsibility, building public trust, and making a positive impact in their communities.

For more information, please visit Deloitte’s web site at www.deloitte.com.au

Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/au/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms.

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EXPLANATORY MEMORANDUM 81

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sEcTiON 5. fURThER iNfORMATiON

EXPLANATORY MEMORANDUM

5.1 DiREcTORs’ REcOMMENDATiON

==> picture [163 x 162] intentionally omitted <==

The Cromwell Property Securities Limited directors consider the Resolutions to be in the best interests of securityholders and (unanimously) recommend that securityholders vote in favour of the Resolutions. Each director believes that the advantages of the Resolutions outweigh the disadvantages for Cromwell Group.

With regard to the Acquisition Proposal, the directors took into account the Independent Valuations (Sections 4.9 and 4.10), the Independent Expert’s Report that the Acquisition Proposal is fair and reasonable from the perspective of nonassociated securityholders (Section 4.11), the advantages and disadvantages and potential risks of the Acquisition Proposal (Section 4.8) and the impact of the Acquisition Proposal on the Cromwell Group’s financial position (Section 4.7).

With regard to the Placement Ratification, the directors took into account the Group’s existing capital management program and potential capital requirements of the Group over the next 6 –12 months.

With regard to the Constitution Amendement, the directors took into account the need to ensure greater flexibility with regard the Group’s capital management activities.

EXPLANATORY MEMORANDUM 83

5.2 ADDiTiONAL iNfORMATiON

5.2.1 Voting Intentions

All directors who are securityholders intend to vote in favour of the Placement Ratification and the Constitution Amendement. The directors cannot vote on the Acquisition Proposal under the Listing Rules. Mr Marc Wainer, the Redefine appointee on the Board, is not a securityholder and so will not vote on any Resolution.

5.2.2 Interests of Directors

The table below shows which directors hold Cromwell Group securities and how many they hold as at the date of this document:

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----- Start of picture text -----

Holders Options over
(and entities associated Ordinary unissued
with them) securities
----- End of picture text -----

Geoff levy	370,000	-
Paul Weightman	15,464,167	738,733
robert Pullar	14,000,000	-
daryl Wilson david usasz	1,955,744 1,927,580	344,200 -
richard Foster	5,261,765	-
Michelle McKellar	330,000	-
Marc Wainer	-	-
Total	39,568,518	1,082,933

To the extent they hold Cromwell Group stapled securities and options over unissued Group stapled securities, the directors have an interest in the outcome of the vote on the Resolutions. As executive directors Mr Weightman and Mr Wilson’s remuneration packages also include a cash short term incentive. The outcome of the vote on the Resolutions will have an impact on the Group’s financial position and that outcome may, in turn, impact on the amount of any such cash short term incentive.

No director holds any units in Cromwell Property Fund.

5.2.3 Cross Holdings

CCL holds 275,106 units in the Trust which are not stapled securities. CCL will not vote these units.

Otherwise, no Cromwell Group entity owns any Cromwell Group securities.

5.2.4 Expenses of the Resolutions

The costs of the Resolutions include advisory costs, independent expert and valuers’ fees and other costs. These costs will total approximately $300,000.

5.2.5 Communicating with Investors

Following the CCL and DPT meetings on 7 July 2010 an ASX announcement will be made by Cromwell Group advising securityholders of the outcome.

5.2.6 Privacy

The Cromwell Group, which includes CPSL, complies with the Privacy Act 1988 and is bound by the National Privacy Principles governing the handling of personal information. CPSL has adopted a Privacy Policy which can be obtained from its website or from its privacy officer. This section summarises the Group’s information handling practices which are detailed in the Privacy Policy.

Information collected by CPSL is used primarily to enable CPSL to record and maintain relevant details about investors, service providers and others it deals with to facilitate payments, to enable corporate communications and to promote CPSL’s products and services. If related entities or service providers assist CPSL to do those things, then CPSL may disclose personal information to them. Information about an investor may also be provided to their nominated financial advisor.

The Group makes reasonable efforts to ensure the confidentiality and security of records covering personal information. If personal information is requested on a proxy form, or other form associated with voting, but not provided then CPSL may not be able to accept your vote.

CPSL has appointed a privacy officer who is responsible for the management of the Group’s Privacy Policy and procedures and is the contact person in relation to privacy issues. Investors are able to gain access to personal information about them collected by CPSL by contacting the privacy officer.

Further information can be obtained by contacting:

The Privacy Officer

Cromwell Property Securities Limited Telephone: 1800 334 533 or (07) 3225 7777 Fax: (07) 3225 7788

84 EXPLANATORY MEMORANDUM

5.2.7 Supplemental Deed

Supplemental deed

Cromwell Diversified Property Trust ARSN 102 982 598

Cromwell Property Securities Limited ACN 079 147 809 ( Responsible Entity )

MinterEllison

L A W Y E R S

AURORA PLACE, 88 PHILLIP STREET, SYDNEY NSW 2000, DX 117 SYDNEY TEL: +61 2 9921 8888 FAX: +61 2 9921 8123 www.minterellison.com

ME_85946583_4 (W2003)

EXPLANATORY MEMORANDUM 85

Supplemental deed

Details	Details	3
Agreed terms		4
1.	Defined terms & interpretation	4
2.	Amendment of the Constitution	4
3.	Operation of this document	4
4.	No redeclaration etc	5
5.	Governing law and jurisdiction	5
Signing page		6

Minter	Ellison	Ref: SCJ:JSW 20-6466124

ME_85946583_4 (W2003)

86 EXPLANATORY MEMORANDUM

Details

Date

Parties

Name Cromwell Property Securities Limited in its capacity as responsible entity of the Cromwell Diversified Property Trust ARSN 102 982 598 ACN 079 147 809 Short form name Responsible Entity

Background

A The Responsible Entity is the responsible entity of the registered managed investment scheme known as the Cromwell Diversified Property Trust ARSN 102 982 598 ( Trust ). The Trust was established pursuant to a trust deed dated 27 November 2002, as subsequently amended from time to time ( Constitution ).
B Clause 21.1 of the Constitution provides that the Constitution may be modified, or repealed and replaced with a new constitution in accordance with the Corporations Act 2001 (Cth) ( Corporations Act ).
C Pursuant to section 601GC(1)(a) of the Corporations Act, the constitution of a registered scheme may be modified by special resolution of the members of the scheme.
D By this deed, the Responsible Entity proposes to give effect to the special resolution modifying the Constitution set out in the Notice of Meeting and Explanatory Memorandum dated 11 June 2010 and passed by Trust members at the meeting held on 7 July 2010 in accordance with the Constitution and the Corporations Act.
E The amendments to the Constitution contained in this deed will take effect when a copy of this deed is lodged with ASIC.

Minter Ellison | Ref: SCJ:JSW 20-6466124

Cromwell Diversified Property Trust - Supplemental Deed | page 3

ME_85946583_4 (W2003)

EXPLANATORY MEMORANDUM 87

Agreed terms

1. Defined terms & interpretation

In this deed, unless a contrary intention is expressed or implied, words and expressions defined in the Constitution have the same meanings when used in this deed.

2. Amendment of the Constitution

The Constitution is amended as follows:

(a) by deleting the existing sub-clause (b) of clause 3.1 and replacing it with a new sub-clause (b) as follows:

"where permitted by any Relief and the ASX Listing Rules, such other price as the Manager determines in its discretion."; and

(b) by inserting a new clause 3.1A as follows:

"Where:

(a) Holder approval or ratification of an issue made pursuant to clause 3.1(b) is sought; and
(b) any Relief relied upon to make that issue requires that Holder approval or ratification of that issue for the purposes of that Relief be done via a Placement Resolution,

then Holder approval or ratification of that issue will only be effective for the purposes of that Relief if:

(c) Holders who hold Units in the same class approve the proposed placement by a Placement Resolution;
(d) unless the Manager reasonably considers that the proposed placement will not adversely affect the interests of Holders holding Units in another class – Holders in that other class approve the proposed placement by a Placement Resolution; and
(e) any notice convening a meeting to vote on a proposed Placement Resolution contains particulars of the use to be made of the money raised by the issue.

This clause does not limit the way in which an issue made pursuant to clause 3.1(b) may be effectively approved or ratified for any other purpose."

3. Operation of this document

This deed takes effect on the date that it is lodged with ASIC in accordance with section 601GC(2) of the Corporations Act.

Minter Ellison | Ref: SCJ:JSW 20-6466124

Cromwell Diversified Property Trust - Supplemental Deed | page 4

ME_85946583_4 (W2003)

88 EXPLANATORY MEMORANDUM

4. No redeclaration etc

The Responsible Entity confirms that it is not, by clause 2 of this deed:

(a) redeclaring the Trust;
(b) resettling the Trust;
(c) causing the transfer, vesting or accruing of property in any person; or
(d) entering into a new constitution.

5. Governing law and jurisdiction

This deed is governed by the laws of Queensland, Australia. The Responsible Entity irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts of Queensland and courts entitled to hear appeals from those courts.

Minter Ellison | Ref: SCJ:JSW 20-6466124

Cromwell Diversified Property Trust - Supplemental Deed | page 5

ME_85946583_4 (W2003)

EXPLANATORY MEMORANDUM 89

Si nin g g page

EXECUTED as a deed.

Executed by Cromwell Property Securities Limited in accordance with Section 127 of the Corporations Act 2001

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Signature of director Signature of director/company secretary
(Please delete as applicable)
Name of director (print) Name of director/company secretary (print)
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Minter Ellison | Ref: SCJ:JSW 20-6466124

Cromwell Diversified Property Trust - Supplemental Deed | page 6

ME_85946583_4 (W2003)

90 EXPLANATORY MEMORANDUM

5.3 gLOssARY

acquisition proposal means the transactions outlined at the start of the Acquisition Proposal, Section 4.1.

ccl means Cromwell Corporation Limited (ACN 001 056 980).

constitution means the constitution of the Cromwell Diversified Property Trust (ARSN 102 982 598) dated 27 November 2002 as amended.

constitution amendment means the proposed amendments to the Trust’s constitution to simplify the voting requirements for the approval or ratification of the issue of securities.

cpF means Cromwell Property Fund (ARSN 119 080 410)

cpsl means Cromwell Property Securities Limited (ACN 079 147 809).

Dpt means Cromwell Diversified Property Trust (ARSN 102 982 598).

Explanatory memorandum means this document, which accompanies the Notice of Meeting and explains the Resolutions.

Exhibition property means the property at 321 Exhibition Street, Melbourne, Victoria.

Forecast period means the financial years ending 30 June 2011 and 30 June 2012.

notice of meeting means the notice of a meeting of unitholders in the Cromwell Diversified Property Trust on 7 July 2010 which this document accompanies.

placement means the issue of 104,750,000 stapled securities to Redefine Australian Investments Limited on 29 December 2010.

placement Ratification means the proposal to retrospectively approve the Placement (see Section 3.1).

potential tenant means the major listed Australian company that has signed a heads of agreement to lease the majority ot the Exhibition Property from CPF.

properties means the Exhibition Property and the TGA Property.

Record Date means the date on which, at the close of business, those securityholders who are eligible to vote on the Resolution will be determined.

Resolutions means Resolution 1, Resolution 2, Resolution 3 and Resolution 4.

Resolution 1 means the resolution in relation to the Placement Ratification.

Resolution 2 means the resolution to amend the Trust’s constitution as set out in the supplemental deed at Section 5.2.7.

Resolution 3 means the resolution in relation to the Placement Ratification which will be considered if Resolution 1 is not passed and Resolution 2 is passed.

Resolution 4 means the resolution in relation to the Acquisition Proposal.

tGa property means Therapeutic Goods Administration Complex in Symonston, Canberra, ACT.

the company means Cromwell Corporation Limited (ACN 001 056 980).

the trust means Cromwell Diversified Property Trust (ARSN 102 982 598).

EXPLANATORY MEMORANDUM 91

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5.4 DiREcTORY

Board of Directors

Geoffrey H Levy Robert J Pullar Michelle A McKellar David E Usasz Paul L Weightman W Richard Foster Daryl J Wilson Marc Wainer

company secretary

Nicole E Riethmuller

Registry

Link Market Service Limited Street Address: Level 12 680 George Street SYDNEY NSW 2000 Postal Address: Locked Bag A14 SYDNEY SOUTH NSW 1235 Tel: 1300 550 841 Fax: (02) 9287 0303 Web: www.linkmarketservices.com.au

Registered office

Cromwell Property Securities Limited Street Address: Level 19 200 Mary Street BRISBANE QLD 4000 Postal Address: GPO Box 1093 BRISBANE QLD 4001 Tel: (07) 3225 7777 Fax: (07) 3225 7788 Web: www.cromwell.com.au

listing

Cromwell Group is listed on the Australian Securities Exchange (ASX: CMW)

92 EXPLANATORY MEMORANDUM

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94 EXPLANATORY MEMORANDUM

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Cromwell Diversified Property Trust Notice of Meeting

Notice is hereby given by Cromwell Property Securities Limited ABN 11 079 147 809 AFSL 238052 (“CPSL”) as responsible entity of Cromwell Diversified Property Trust ARSN 102 982 598 (“the Trust”) that a general meeting of the Trust will be held on:

Date: Wednesday 7 July 2010 Time: 1.30pm Venue: Brisbane Auditorium, Level 5, Riverside Centre, 123 Eagle Street

Additional information concerning the proposed resolutions is contained in the Explanatory Memorandum which accompanies and forms part of this Notice of Meeting.

The Trust forms part of the stapled security Cromwell Group (ASX: CMW), along with Cromwell Corporation Limited ABN 44 001 056 980 (“CCL”).

Securityholders are reminded that the units in the Trust and the ordinary shares in CCL are stapled together under the respective constitutions of the Trust and CCL. This means that all securityholders are unitholders in the Trust and shareholders of CCL and each securityholder has the same number of units in the Trust as it holds ordinary shares in CCL.

This Notice of Meeting relates to a meeting of Trust unitholders only.

A meeting of CCL shareholders has also been called. A separate notice of meeting has been issued for the meeting of CCL shareholders.

ORDINARY BUSINESS FOR THE TRUST

The business to be considered at the general meeting is as follows:

1.

Ratification of issue of securities in the past year (“Placement Ratification” PR )

To consider and, if thought fit, to pass the following resolution as a special resolution of the Trust (“Resolution 1”):

“That the issue of 104,750,000 ordinary units in the Trust as a component of the 104,750,000 stapled securities of the Cromwell Group that were issued to Redefine Australian Investments Limited (“Redefine”) on 24 December 2009 is ratified and approved for the purposes of ASX Listing Rule 7.4, the constitution of the Trust, ASIC Class Order 05/26 and for all other purposes.”

2.

Amendment of Trust constitution (the “Constitution Amendment” PR )

To consider and, if thought fit, to pass the following as a special resolution of the Trust (“Resolution 2”):

That:

(a) the constitution of the Trust is modified as set out in the supplemental deed contained in Section 5.2.7 of the Explanatory Memorandum dated 11 June 2010 (“Supplemental Deed”), with effect from the time that the Supplemental Deed is lodged with the Australian Securities and Investments Commission; and
(b) CPSL as the responsible entity of the Trust is authorised to execute the Supplemental Deed, lodge the Supplemental Deed with the Australian Securities and Investments Commission and do all other things which it reasonably considers necessary or incidental to implement the changes to the constitution of the Trust set out in the Supplemental Deed.

Notice of Meeting 1

3.

Ratification of issue of securities in the past year (only to be considered if Resolution 1 is not approved and Resolution 2 is approved), (also “Placement Ratification” PR )

To consider and, if thought fit, to pass the following resolution as an ordinary resolution of the Trust (“Resolution 3”):

“That, subject to and conditional on Resolution 2 being passed and with effect from the time that the Supplemental Deed is lodged with the Australian Securities and Investments Commission, the issue of 104,750,000 ordinary units in the Trust as a component of 104,750,000 stapled securities of the Cromwell Group that were issued to Redefine Australian Investments Limited in December 2009 is ratified and approved for the purposes of ASX Listing Rule 7.4, the constitution of the Trust and for all other purposes.

4.

Approval of related party transactions (“Acquisition Proposal” AP )

To consider and, if thought fit, to pass the following resolution as an ordinary resolution of the Trust (“Resolution 4”):

“That the acquisition by the Trust from the Cromwell Property Fund ARSN 119 080 410 (“CPF”), the responsible entity of which is Cromwell Property Securities Limited ABN 11 079 147 809, of the property located at 321 Exhibition Street, Melbourne and CPF’s one-third interest in the TGA complex at Symonston, ACT, and the amendment of the terms of the existing debt facility the Trust has provided CPF, as outlined in the Explanatory Memorandum dated 11 June 2010 is approved for the purposes of ASX Listing Rule 10.1, Chapter 2E of the Corporations Act 2001 (Cth), as modified by Part 5C.7, and for all other purposes.”

5. Other business

To consider any other business that may be brought forward in accordance with the Trust’s constitution and the Corporations Act 2001 (Cth).

By order of the Board of Cromwell Property Securities Limited.

Nicole Riethmuller Company Secretary 11 June 2010

Securityholders should consider the attached Explanatory Memorandum before deciding how to vote in relation to the above resolutions.

Notice of Meeting 2

NOTES

1 Terminology

Terms which are defined in the constitution of the Trust (“the Constitution”) have the same meaning when used in this notice (including these notes and the Explanatory Memorandum) unless the context requires otherwise.

2 Quorum

The Constitution provides that a quorum of securityholders for a general meeting of the Trust is three securityholders present in person or by proxy or body corporate representative. The quorum must be present throughout the meeting. If the quorum is not present within 30 minutes after the time appointed for the meeting, the meeting will be adjourned in accordance with the Constitution. If a quorum is not present within 30 minutes after the time appointed for the adjourned meeting, the meeting will be dissolved.

3 Resolutions

Resolution 1 will only be passed if securityholders holding at least 25% of the total value of securities eligible to vote vote on the resolution and at least 75% of the votes cast by securityholders entitled to vote on that resolution and present at the meeting (in person or by proxy) are in favour of the resolution.

Resolution 2 will only be passed if at least 75% of the votes cast by securityholders entitled to vote on that resolution and present at the meeting (in person or by proxy) are in favour of the resolution.

Resolution 3 will only be considered by the meeting if Resolution 1 is not passed but Resolution 2 is approved.

Resolution 3 will only be passed if at least 50% of the votes cast by securityholders entitled to vote on that resolution and present at the meeting (in person or by proxy) are in favour of the resolution.

Resolution 4 will only be passed if at least 50% of the votes cast by securityholders entitled to vote on that resolution and present at the meeting (in person or by proxy) are in favour of the resolution.

4 Voting

The directors of CPSL have determined that, for the purposes of the meeting, units will be taken to be held by the persons who are registered as securityholders as at 7.00pm, 5 July 2010. Accordingly, transfers registered after this time will be disregarded in determining entitlements to vote at the meeting.

The Chairman will determine that the voting on Resolutions 1, 2, 3 and 4 will be conducted by way of a poll.

A securityholder who is entitled to cast two or more votes on a poll need not cast all their votes and may cast their votes in different ways.

On a poll, every securityholder has one vote for each dollar value of the total units held by the securityholder. In the case of units held by joint holders, only the vote of the joint holder whose name appears first in the register will be accepted.

5 Corporate representatives and powers of attorney

Corporate representatives are required to bring an original or certified copy of their appointment as a representative to the meeting, or provide it to CPSL or the Registry before the meeting. A form of the certificate of appointment may be obtained from the Registry. Attorneys are required to lodge a certified copy or the original of the power of attorney pursuant to which they were appointed at the Registry or at the registered office of CPSL (including by fax) not later than 1:30pm on 5 July 2010. Proof of identity will be required to be presented at the meeting for corporate representatives and attorneys.

6 Proxies

Each securityholder has the right to appoint a proxy. If you do not plan to attend the meeting in person, you are encouraged to complete and return the proxy form which accompanies this Notice of Meeting or vote online at www.cromwell.com.au/registry. A securityholder who is entitled to attend and vote at the meetings may attend and vote by proxy.

A securityholder who is entitled to cast two or more votes on a poll may appoint two proxies and may specify the proportion or number of votes each proxy is entitled to exercise. If you do not specify a proportion or number, each proxy may exercise half of the votes. If you appoint two proxies to vote, neither proxy can vote on a show of hands. On a poll, each proxy can only exercise votes in respect of those units or voting rights the proxy represents.

A proxy need not be a securityholder and may be either an individual or a body corporate. A securityholder appointing a proxy may direct a proxy to vote “for”, to vote “against” or abstain from voting on each resolution, or may leave the decision to the proxy following discussion at the meeting. Please refer to the enclosed proxy form for instructions on completion and lodgement.

If your proxy is not the chairman, he or she may choose whether or not to vote on a poll. If he or she chooses to vote, he or she must do so as directed by you, unless you do not give any such direction to the proxy. If your proxy is the chairman, they must vote on a poll and must do so as directed by you, unless you do not give any such direction.

If you appoint a proxy, you may still attend the meeting. Your proxy’s authority to speak and vote at the meeting is suspended whilst you are present.

Please note that proxy forms (and, if they are executed pursuant to a power of attorney, a certified copy or the original of the power of attorney) must be lodged online or received at the Registry or at the registered office of CPSL (including by fax) not later than 1.30pm on 5 July 2010.

Notice of Meeting 3

7 How the chairman will vote undirected proxies

The Chairman intends to vote undirected proxies appointing the Chairman as proxy in favour of the Resolutions. CPSL encourages all securityholders who submit proxies to direct their proxy how to vote on each Resolution.

8 Lodgement of proxies and queries

Proxy forms and authorities should be sent to the Registry at the address specified on the enclosed reply paid envelope or to the address specified below:

Address:

Link Market Services Pty Limited Locked Bag A14 Sydney South NSW 1235 Facsimile: +61 2 9287 0309

Online: www.cromwell.com.au/registry

Securityholders should contact the Registry of the Trust at the above address or telephone 1300 550 841 (toll free within Australia) or +61 2 8280 7124 (from outside Australia) with any queries.

9 Voting restriction

In accordance with section 253E of the Corporations Act, CPSL and its associates are not entitled to vote on any resolution of the Trust if they have an interest in the resolution other than as a member of the Trust.

The following disclosures are made to comply with the Listing Rules.

CPSL will disregard any votes cast on Resolution 1 by:

| Redefine, being the person who participated in the issue; and
| an associate (as defined in sections 11 and 13-17 of the Corporations Act) of that person.

However, CPSL need not disregard a vote (for the purposes of this statement) if:

| it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
| it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

Note the qualifications in the previous paragraph to the voting exclusion only apply for the purpose of the voting exclusion included for the purposes of Listing Rule 7.5.6. They do not apply to the voting exclusion that applies as a result of the resolution being proposed as a ‘placement resolution’ for the purposes of the Class Order.

CPSL will disregard any votes cast on Resolution 3 by:

| Redefine, being the person who participated in the issue; and
| an associate (as defined in sections 11 and 13-17 of the Corporations Act) of that person.

However, CPSL need not disregard a vote (for the purposes of this statement) if:

| it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
| it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

CPSL will disregard any votes cast on Resolution 4 by:

| CPSL, being the person who is a party to the transaction; and
| an associate (as defined in sections 11 and 13-17 of the Corporations Act) of CPSL.

However, CPSL need not disregard a vote (for the purposes of this statement) if:

| it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
| it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

Notice of Meeting 4

LODGE YOUR VOTE



www.linkmarketservices.com.au

ONLINE

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Cromwell Property Securities Limited (ABN 11 079 147 809, AFSL 238052) ( CPSL ) as responsible entity of the Cromwell Diversified Property Trust (ARSN 102 982 598) (the Trust )

By mail:  Cromwell Diversified Property Trust  [By fax:][ +61 2 9287 0309] C/- Link Market Services Limited Locked Bag A14 Sydney South NSW 1235 Australia



All enquiries to: Telephone: 1300 550 841 Overseas: +61 2 8280 7124

X99999999999

UNITHOLDER VOTING FORM

I/We being a member(s) of Cromwell Diversified Property Trust and entitled to attend and vote hereby appoint:

STEP 1 APPOINT A PROXY the Chairman OR if you are NOT appointing the Chairman of the of the Meetings Meetings as your proxy, please write the name of the (mark box) person or body corporate (excluding the registered unitholder) you are appointing as your proxy or failing the person/body corporate named, or if no person/body corporate is named, the Chairman of the Meetings, as my/our proxy and to vote for me/us on my/our behalf at the Meeting of the Trust to be held at 1:30pm on Wednesday, 7 July 2010, at Brisbane Auditorium, Level 5, Riverside Centre, 123 Eagle Street, Brisbane and at any adjournment or postponement of the meeting.

Proxies will only be valid and accepted by the Trust if they are signed and received no later than 48 hours before the meeting. Please read the voting instructions overleaf before marking any boxes with an X

STEP 2 VOTING DIRECTIONS Resolution 1 For Against Abstain * Resolution 3 For Against Abstain * Approve and ratify the issue of units Approve and ratify the issue of units in the Trust to Redefine Australian in the Trust to Redefine Australian Investments Limited as a ‘placement Investments Limited. resolution’.

Resolution 2 Resolution 4 Approve the amendments to the Trust Approve the Acquisition Proposal Constitution outlined in the Explanatory as outlined in the Explanatory Memorandum for the meeting. Memorandum for the meeting.

 * If you mark the Abstain box for a particular Item, you are directing your proxy not to vote on your behalf on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

STEP 3 IMPORTANT – VOTING EXCLUSIONS If the Chairman of the Meetings is appointed as your proxy, or may be appointed by default and you do not wish to direct your proxy how to vote as your proxy in respect of Item 4 above, please place a mark in this box. By marking this box, you acknowledge that the Chairman of the Meetings may exercise your proxy even though he has an interest in the outcome of these Items and that votes cast by him for these Items, other than as proxyholder, would be disregarded because of that interest. If you do not mark this box, and you have not directed your proxy how to vote, the Chairman of the Meetings will not cast your votes on Item 4 and your votes will not be counted in calculating the required majority if a poll is called on these Items. The Chairman of the Meetings intends to vote undirected proxies in favour of Item 4.

STEP 4 SIGNATURE OF UNITHOLDERS – THIS MUST BE COMPLETED

Unitholder 1 (Individual) Joint Unitholder 2 (Individual) Joint Unitholder 3 (Individual) Sole Director and Sole Company Secretary Director/Company Secretary (Delete one) Director

This form should be signed by the unitholder. If a joint holding, either unitholder may sign. If signed by the unitholder’s attorney, the power of attorney must have been previously noted by the registry or a certified copy attached to this form. If executed by a company, the form must be executed in accordance with the company’s constitution and the Corporations Act 2001 (Cth).

CMW PRX002

HOW TO COMPLETE THIS PROXY FORM

Your Name and Address

This is your name and address as it appears on the Trust’s unit register. If this information is incorrect, please make the correction on the form. Unitholders sponsored by a broker should advise their broker of any changes. Please note: you cannot change ownership of your units using this form.

Appointment of a Proxy

If you wish to appoint the Chairman of the Meetings as your proxy, mark the box in Step 1. If the person you wish to appoint as your proxy is someone other than the Chairman of the Meetings please write the name of that person in Step 1. If you leave this section blank, or your named proxy does not attend the meeting, the Chairman of the Meetings will be your proxy. A proxy need not be a unitholder of the Trust. A proxy may be an individual or a body corporate.

Votes on Items of Business – Proxy Appointment

You may direct your proxy how to vote by placing a mark in one of the boxes opposite each item of business. All your units will be voted in accordance with such a direction unless you indicate only a portion of voting rights are to be voted on any item by inserting the percentage or number of units you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on the items of business, your proxy may vote as he or she chooses. If you mark more than one box on an item your vote on that item will be invalid.

Appointment of a Second Proxy

You are entitled to appoint up to two persons as proxies to attend the meeting and vote on a poll. If you wish to appoint a second proxy, an additional Proxy Form may be obtained by telephoning the Trust’s unit registry or you may copy this form and return them both together.

To appoint a second proxy you must:

(a) on each of the first Proxy Form and the second Proxy Form state the percentage of your voting rights or number of units applicable to that form. If the appointments do not specify the percentage or number of votes that each proxy may exercise, each proxy may exercise half your votes. Fractions of votes will be disregarded.
(b) return both forms together.

Signing Instructions

You must sign this form as follows in the spaces provided:

Individual: where the holding is in one name, the holder must sign.

Joint Holding: where the holding is in more than one name, either unitholder may sign.

Power of Attorney: to sign under Power of Attorney, you must lodge the Power of Attorney with the registry. If you have not previously lodged this document for notation, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001 ) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please indicate the office held by signing in the appropriate place.

Corporate Representatives

If a representative of the corporation is to attend the meeting the appropriate “Certificate of Appointment of Corporate Representative” should be produced prior to admission in accordance with the Notice of Meeting. A form of the certificate may be obtained from the Trust’s unit registry.

Lodgement of a Proxy Form

This Proxy Form (and any Power of Attorney under which it is signed) must be received at an address given below by 1:30pm on Monday, 5 July 2010, being not later than 48 hours before the commencement of the meeting. Any Proxy Form received after that time will not be valid for the scheduled meeting.

Proxy Forms may be lodged using the reply paid envelope or:

 ONLINE

www.linkmarketservices.com.au

Select the ‘Proxy Voting’ option on the top right of the home page. Choose the company you wish to lodge your vote for from the drop down menu, enter your holding details as shown on this form, and follow the prompts to lodge your vote. To use the online lodgement facility, unitholders will need their “Holder Identifier” (Securityholder Reference Number (SRN) or Holder Identification Number (HIN) as shown on the front of the proxy form).

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 by mail:
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Cromwell Diversified Property Trust C/- Link Market Services Limited Locked Bag A14 Sydney South NSW 1235 Australia

 by fax:

+61 2 9287 0309



by hand:

delivering it to Link Market Services Limited, Level 12, 680 George Street, Sydney NSW 2000.

If you would like to attend and vote at the Meeting, please bring this form with you. This will assist in registering your attendance.

AI assistant

CROMWELL PROPERTY GROUP — Proxy Solicitation & Information Statement 2010

64673_rns_2010-06-07_ad9b8aa9-b95f-488a-8b55-12b95fb48855.pdf

RE: CROMWELL GROUP – CROMWELL DIVERSIFIED PROPERTY TRUST MEETING – PLACEMENT RATIFICATION, CONSTITUTIONAL AMENDMENT AND ACQUISTION PROPOSAL

CROMWELL GROUP

Investment Enquiries 1800 334 533 | Property Management 1800 005 657

EXPLANATORY MEMORANDUM In relatIon to four resolutIons to be voted on by unItholders

1. LETTER fROM ThE chAiRMAN

Dear Securityholder,

Directors’ Recommendation

Your Vote is Important

Further Information

Independent Expert’s Report

Table of Contents

Important Information

Purpose of this Explanatory Memorandum

Financial product advice

Preparation of this Explanatory Memorandum

Content Disclaimers

2. whAT shOULD i DO?

carefully read this Explanatory memorandum

2.1 The Resolutions

PR The Placement Ratification (resolutions 1 and 3)

PR The Constitution Amendment (resolutions 2)

AP The Acquisition Proposal (resolution 4)

2.2 Vote on the Resolutions

2.3 Key Dates

3.1 sUMMARY Of REsOLUTiONs 1, 2 & 3

3.1.1 About the Placement Ratification and Constitution Amendment

3.1.2 Strategic Rationale

a) placement

b) Ratification

3.1 sUMMARY Of REsOLUTiONs 1, 2 & 3 cONTiNUED

3.1.3 Investment Strategy

3.1.4 The Constitution Amendment and the Placement Ratification alternatives

3.2 LEgAL & REgULATORY REqUiREMENTs

3.2.1 ASX Listing Rules 7.1 and 7.4

3.2.2 Information required under Listing Rule 7.5

3.2 LEgAL & REgULATORY REqUiREMENTs cONTiNUED

3.2.2.1 asIc class order 05/26

3.2.2.2 placement resolution

3.2.3 Voting exclusion statement

3.2.4 Other information

3.2.5 Approval sought

sEcTiON 4. AcqUisiTiON PROPOsAL (resolution 4)

4.1 sUMMARY Of REsOLUTiON 4

4.1.1 About the Acquisition Proposal

What does the acquisition proposal involve?

4.2 fREqUENTLY AskED qUEsTiONs

Why is the cromwell property Fund selling the properties?

What are the pre-conditions to the acquisition proposal being considered at the meeting?

How will the acquisition proposal be funded?

How was the price that cromwell Group is to pay for the Exhibition property and the interest in the tGa property determined?

What financial benefits is the trust paying to its related party, cpF?

How long will the Exhibition property be vacant?

What is happening with the refurbishment?

4.2 fREqUENTLY AskED qUEsTiONs cONTiNUED

What are the key terms of the loans utilised to acquire the properties?

What are the key terms of the trust’s existing loan to cpF?

are there any other loans between cromwell Group and cpF?

What will the level of gearing of cromwell Group be if the acquisition proposal is completed?

What impact will the acquisition proposal have on the earnings of cromwell Group?

What impact does the acquisition have on the value of the Group?

Will my distributions be affected?

How will the acquisition proposal impact the cromwell Group property portfolio?

What vote is required for the acquisition proposal to proceed?

What happens if the acquisition proposal doesn’t proceed?

What else could the trust do instead of the acquisition proposal?

How did cromwell ensure that the interests of both cromwell Group securityholders and cpF unitholders were regarded?

What does the Board recommend?

What is the opinion of the Independent Expert?

Do I have to vote?

How can I get further information on the material contained in this Explanatory memorandum?

4.3 LEgAL & REgULATORY REqUiREMENTs

4.3.1 Listing Rule 10.1

4.3.2 Chapter 2E, as modified by Part 5C.7

4.3.3 Voting exclusion statement

4.3.4 Independent expert’s report

4.3.5 Approval sought

4.4 EXhibiTiON PROPERTY

CROMWELL PROPERTY GROUP Proxy Solicitation & Information Statement 2010