DIC Asset AG — Interim / Quarterly Report 2009

Nov 11, 2009

INTERIM REPORT 3 R D QUARTER 2009

Hallbergmoos, Lilienthalstraße

CONTENT
Foreword	2
Interim Group Management Report	7
The Share	35
Consolidated Financial Statements as at 30 September 2009	38
Notes	46
Review Report	48
Longer Term Overview	50
Portfolio Overview	52

KEY FIGURES

Key operating figures in EUR million	9M 2009	9M 2008		Q3 2009	Q2 2009
Gross rental income	100.8	101.0	0%	33.5	34.1	-2%
Net rental income	93.5	96.2	-3%	30.7	31.6	-3%
Total revenues	127.6	140.6	-9%	42.3	41.7	+1%
Profit on disposal of properties	0.9	4.7	-81%	0.3	0.4	-25%
Funds from Operations (FFO)	35.6	33.6	+6%	13.9	11.5	+21%
EBITDA	83.5	92.7	-10%	27.4	28.6	-4%
EBIT	60.9	71.7	-15%	19.8	20.9	-5%
EBDA	34.2	39.5	-13%	13.1	11.2	+17%
Profit for the period	11.5	18.5	-38%	5.4	3.5	+54%
Investment	33.5	193.1	-83%	0.0	0.0	0%
Cash flow from operating activities	28.8	24.6	+17%	10.1	9.6	+5%

Balance sheet data in EUR million	30.09. 2009	31.12. 2008		30.09. 2009	30.06. 2009
Equity ratio in %	23.4	24.1	-3%	23.4	23.8	-2%
Debt	1,691.5	1,681.0	+1%	1,691.5	1,694.6	0%
Investment property	2,032.0	2,022.9	0%	2,032.0	2,040.8	0%
Total assets	2,209.1	2,214.8	0%	2,209.1	2,223.2	-1%

Per share in EUR	9M 2009	9M 2008	Q3 2009	Q2 2009
FFO	1.16	1.07 +8%	0.44	0.38 +16%
EBDA	1.11	1.26 -12%	0.42	0.37 +14%
Basic/diluted earnings	0.37	0.59 -37%	0.17	0.12 +42%

• ➔ Profit for the period of EUR 11.5 million
• ➔ FFO-guidance raised considerably to EUR 45-46 million
• ➔ Letting volume +13% against previous year

The Management Board of DIC Asset AG (from left): Dr. Jürgen Schäfer, Ulrich Höller, Markus Koch

Dear Shareholders, Business Partners, Employees and Friends,

Our figures for the third quarter of 2009 have exceeded our previous expectations despite market conditions remaining difficult. They therefore underline the stability of DIC Asset AG and its business model. In particular, that is welcome news for our shareholders who have made a wise decision by investing in DIC Asset AG:

• Our letting result in the portfolio as a whole amounts to 178,000 sqm, which is 13% up on the previous year.
• We have generated an FFO of EUR 35.6 million from our operations, thereby achieving our target for this year ahead of schedule.
• Thanks to a strong result in the third quarter, we have achieved a profit for the period to EUR 11.5 million.
• Due to our stable position, we are able to considerably increase our 2009 FFO forecast to between EUR 45 million and EUR 46 million.

In autumn 2009, sentiment improved in the German economy. For the time being, the upward trend is heavily dependent on rising demand from abroad. Even if certain areas of the economy are starting to find their feet once again, experience tells us that the real estate sector will react slowly to the uptick in the economy.

For our company this means that DIC Asset AG will have to press ahead with its business under difficult conditions in the next twelve to 18 months. At the same time, the letting business will continue to require commitment, flexibility and creativity. While there are signs of prices bottoming out in the transaction market, ongoing restrictive lending policies and different ideas on price between sellers and buyers will continue to inhibit activity.

With the help of a stable corporate structure and sound corporate management policies, we have successfully overcome the current challenges. These key pillars make DIC Asset AG robust even in difficult times. This has protected us from surprises, allowed us to make consistent decisions without being rushed into them and helped us to achieve respectable results even during the crisis.

The tried and tested strengths of DIC Asset AG will continue to provide a sound foundation for our activities, the aim of which is to get through the coming challenges safely and to ensure we have the capacity to sustain the economic upturn:

Our intensive property management maintains the quality of our portfolio

Our tenant-focused property management is a core element in securing income and allows us to leverage the quality of our portfolio effectively. We backed up this strategy with take over of DIC ONSITE to 100%. The day-to-day work of more than 80 employees on site secures the foundation of our stable success: we are able to defy the downward trend in the market and will once again increase our letting volume by 13% in 2009.

Our portfolio is broadly diversified

The tenant mix is balanced and structured long-term with its public sector tenants, internationally active companies, retailers and smaller tenants from a variety of sectors. We also have achieved a balance in terms of location – being represented in major office locations and in attractive secondary locations. Our property management team looks after all our properties through our offices across Germany.

Our assets are reliably valued

By accounting for our properties conservatively at acquisition cost, we offer investors and shareholders a reliable basis for valuing our company. We only realise value added by disposing of properties and consequently generate resilient and stable profits. Improvements in value resulting from buoyant phases in the market serve as a cushion for more difficult times and prevent fluctuations in our results.

Our financing is structured long-term

We always agree our financing on a long-term basis and focus it on the underlying investment. At the same time, we are flexible so we are able to realise market opportunities consistently: we have exploited the historically low interest rates which are currently in place as a means of generating significant savings on interest costs.

At the end of every crisis, opportunities await strong companies that have come through difficult periods in good shape. We shall position our company on the front foot for this phase so that DIC Asset AG will be able to realise opportunities for growth – helped by the momentum of a broad economic upturn. From mid-2010, we expect there to be opportunities to make acquisitions at attractive prices in a once again strengthening German market.

We are delighted that our share has been able to participate so dynamically in the market recovery over recent months. This reflects the return of interest and confidence in the market that you, as shareholders, have already demonstrated to us over a longer period. We would like to take this opportunity to thank you for your confidence and look forward to a positive final quarter in 2009.

Yours sincerely,

Ulrich Höller Markus Koch Dr. Jürgen Schäfer

-GENERAL ECONOMIC CONDITIONS

Burgeoning hope of an economic upturn

The upward trend in the German economy stabilised in the third quarter of 2009. The German Bundesbank's monthly report in October states that there was a perceptible revival in economic output in the third quarter following a slight rise in gross domestic product in the previous three months. This assessment is underlined by the trend in the ifo Business Climate Index, which rose slightly in October 2009 for the seventh time in succession.

In the first half of 2009, German exports had fallen by virtually a quarter. However, the return of confidence, the stimuli provided by global economic programmes and the resultant revival in global economic activity once again boosted the export-oriented German economy in recent months. In particular, foreign demand, which returned, albeit from a low level, in the summer months, constitutes a requisite factor in offsetting the decreasing impact of domestic commercial programmes, such as the car scrappage allowance.

Trend in labour market remains a risk factor for recovery

The labour market was increasingly depressed, albeit at a later date, over the course of the year by the repercussions of the economic crisis. Thanks to targeted support, most notably short-time working programmes, a marked rise in unemployment has been prevented. In October 2009, the number of unemployed fell slightly, primarily as a result of the autumn revival, to some 3.2 million (7.7%). There were 0.2 million fewer people unemployed in the same month in the previous year. In the middle of the year, the German Agency for Employment estimated the number of employees working short-time as a result of the crisis at around 1.4 million. The extent to which a prompt increase in orders will prevent a possible reduction in capacity, is likely to be crucial to a stable economic recovery.

Lending: the credit crunch is biting

Since May 2009, the key interest rate for the euro area has stood at 1.0%. Despite the strategy of low interest rates, new lending has remained subdued and subject to more stringent conditions because of the instability of the financial sector. According to a survey by the German Bundesbank, small and medium companies in particular are anxious about the negative effects of more restrictive lending. While there is currently no assumption by the institution that loans are not being provided in sufficient quantities, it does constitute a latent risk for economic recovery.

Letting activity remains subdued

The situation on the labour market and the prevailing uncertainty with regard to economic growth impacted on letting markets in 2009. Expansion plans and relocations were deferred with tenants instead aiming to consolidate or request short-term lease renewals in the current market situation. In the months from January to September 2009, space worth approximately EUR 1.6 million was let in the major office letting markets. This equates to a fall of 31% compared with the same period in the previous year. The downward trend was spread virtually equally across the three quarters, activity decreased sharply at all major office locations.

Completions are also increasing vacancies

In the major office locations, the vacancy rate increased to almost 10%, partly because the completion of some 800,000 sqm during the year has meant that virtually 50% more new space has come on to the market than in 2008. Vacancies are expected to increase further in 2009 as a whole, since more large-scale completions have again been announced for the final quarter. Against this background, a number of project developments that had not been substantially prelet have also been postponed.

Rents remain relatively stable

Pronounced price sensitivity and the fall in demand are currently putting pressure on rents. Nevertheless, peak rents proved to be stable in the third quarter of 2009, which is also due to the granting of benefits that are unrelated to the rental price. For 2009 as a whole, a slight decline in rents and a fall in the letting volume of some 30% to around 2.0 million sqm are expected.

Revival in the investment property market

The investment market for commercial real estate was hit very hard by the financial crisis and has experienced almost a year without any significant activity. The third quarter of 2009 brought a visible revival for the first time: while transactions were around 70% down compared with the previous year following the first half of 2009, a transaction volume of EUR 3.3 billion was achieved in the third quarter. This signifies a surge in growth of 70% compared with the previous quarter. Sales of German commercial property worth some seven billion euros in total were achieved from January to September 2009.

Obstacles to transactions remain in place

Even if there are signs of the market bottoming out at present, it still has not yet 'turned the corner' fundamentally. Market players remain cautious and, in particular, their financing options are still limited through restrictive lending policies. Investors, who have to contribute more of their own funds overall, are continuing to seek low-risk properties and are therefore focusing on top-quality, fully-let core properties where the tenancies have a long remaining term in the best locations. While this has meant that prices have more or less stabilised in the core retail segment, pricing is still difficult in other asset classes.

Private investors investing most

Private investors remain extraordinarily active: they have accounted for trans actions worth a billion euros and consequently rank top among investor groups, still ahead of public funds. Foreign investors, who made the previous years' record levels of transactions possible, have virtually disappeared from the market. Interest remains focused on individual properties with smaller volumes because they are comparatively easy to market.

Further recovery expected in the investment market in the fourth quarter

Slightly more activity is also expected in the fourth quarter, which will make opportunistic transactions more realistic once more. Nevertheless, in the year as a whole, transaction volumes will remain sharply reduced.

■ BUSINESS DEVELOPMENT

Highlights

➜ Increased: FFO + EUR 2.4 million compared with previous quarter

➜ Expanded: letting 13% up on previous year

➜ Profitable: profit for the period of EUR 11.5 million

➜ Forecast increased: FFO between EUR 45 and 46 million expected

In the first nine months of the 2009 financial year, DIC Asset AG generated stable rental income of just over EUR 100 million. Contrary to the market trend, our intensive property management increased letting volume again by 13% compared with the previous year's good result. On the basis of the Group's robust operating business, we raised the FFO to EUR 35.6 million, and are consequently achieving our forecast for the year as a whole ahead of schedule. The profit for the period amounted to EUR 11.5 million as at 30 September 2009, which is EUR 0.37 per share. Thanks to constant and resilient earnings from our portfolio even in economically challenging times, we are raising our FFO forecast for 2009 as a whole to EUR 45 to 46 million.

Business activities of DIC Asset AG

DIC Asset AG invests exclusively in German commercial real estate. It manages, lets and optimises its property portfolio via the six branches of its asset and property management company DIC ONSITE. The properties are divided into the Core, Value Added and Opportunistic Co-Investments segments according to risk/reward criteria. The value added generated is realised by selling the properties when the time is right.

Segments overview

As at 30.09.2009	Core	VAD	OPP	Total
Proportionate floor space in sqm	455,300	652,200	171,200	1,278,700
Real estate assets* in EUR million	971.3	966.3	280.0	2,217.6
Rental income 9M in EUR million	52.8	48.0	--- **	100.8
EBTDA 9M in EUR million	19.3	18.2	5.1	42.6

* Market value as at 31.12.2008

** relates to minority interests, reported in share of the profit of associates

Portfolio virtually unchanged in size

The DIC Asset AG portfolio encompassed 326 properties and a total floor space of 2.0 million square metres as at 30 September 2009. As at the end of the second quarter, the value of the properties attributable to the company amounted to some EUR 2.2 billion based on their valuation at the end of 2008. They generate annual pro rata net rental income (including opportunistic co-investments) of around EUR 143.6 million.

Portfolio growth

	30.09.2009	31.12.2008	31.12.2007	31.12.2006
Proportionate floor space in sqm	1,278,700	1,275,000	1,214,000	733,000
Real estate assets in EUR million	2,217.6	2,161.8	2,187.5	1,275.3

Portfolio: a broadly based tenant structure, focused on office property

Our portfolio is concentrated on office space and is complemented, above all, by attractive retail and logistics tenants. Across the portfolio as a whole we pursue a policy of achieving a healthy, balanced mix of tenants from various sectors. Companies from the public sector amount to 21%, retail companies to 20%. In addition companies from the sectors telecommunication, IT and multimedia, insurance and banking as well as industrial companies each contribute 9% or more to rental income.

Letting volume increases contrary to the trend

In a declining and far more competitive letting market, we let 178,300 sqm of our portfolio and exceeded the previous year's good result by 13%. The letting result corresponds to annual rental income of some EUR 17.3 million. Challenges remain substantial in all regional letting markets because of the economic uncertainty. From our local contacts we are aware that companies are deferring plans to expand or relocate and are instead increasingly asking for short to medium-term extensions of their tenancy agreements.

Strong lease renewals, increasing numbers of new tenancies

Because of the satisfaction felt by our tenants, we also increased our lease renewals substantially to a total volume of just under 100,000 sqm in the third

Letting result by types of use

Lettable area in sqm	9M 2009	9M 2008
Office	100,100	97,700
Retail	21,300	15,800
Other commercial	51,400	41,000
Residential	5,500	3,900
Total	178,300	158,400
Parking (units)	1,360	870

quarter of 2009. In the course of the year, we also achieved continuous growth in new tenancies. In the third quarter of 2009, we let more space to new tenants than to existing tenants for the first time in the financial year. Space across our entire portfolio let to new tenants amounted to some 78,500 sqm up to 30 September 2009.

Occupancy rate largely stable

Primarily because major tenancy agreements expired in the third quarter, the occupancy rate declined by 0.8 percentage points to 86.8% compared with 30 June 2009.

Rental income matches the level of the previous year

Compared with the first nine months of the previous year, rental income, at some EUR 100.8 million, could be kept virtually stable (-0.2%). In the like-for-like consideration with 31 December 2008, annualised rental income – without the determination of the rental contract with Deutsche Börse AG according to plan – rose slightly by 0.16%. Average rental income per sqm has fallen slightly since the beginning of the year from EUR 10.50 to EUR 10.41 (-0.9%).

Increase in the remaining term, lease expiry sharply reduced

As at 30 September 2009, the average remaining term on our tenancy agreements rose by 0.2 years to 5.5 years. We have already reduced the potential lease expiry for 2010 substantially through our success in letting in the first three quarters. Overall, the possible lease expiry reduced by 27% from EUR 15.7 million at the beginning of the year to EUR 11.5 million.

Berlin, Bundesallee

Left: Duisburg, Königsstraße, Right: Hamburg, Osterstraße

Repositioning and optimisation of properties

As part of our intensive asset and property management services, we reposition properties on the market if necessary. In so doing, we invest selectively in the properties both to create attractive properties that meet tenants' requirements and to create, optimise and secure long-term value added.

BERLIN: PROPERTY OPTIMISED FOR EDUCATIONAL USE

In 2006, DIC Asset AG took over the property in the Bundesallee, which has a total area of 5,300 sqm and was largely vacant In line with its immediate surroundings, namely a school and a kindergarten, we equipped, converted and optimised the building for educational purposes. In September 2009, we won a new anchor tenant in the form of a Protestant educational establishment, which will set up a primary school occupying 2,000 sqm. We also concluded a tenancy agreement for a further 400 sqm with a company specialising in adult education. This means that the property is two thirds let and offers attractive space for additional tenants.

K 57 IN DUISBURG: MODERNISATION AND UPGRADING

In 2007, we took over the 16-storey office block dating from 1961 in Duisburg where the vacancy rate was around 36%. We carried out extensive modernisation work, to make the space attractive and equip it with modern technology. The measures were completed in their entirety in 2009. Immediately thereafter, we succeeded in letting the upgraded space in the property, repositioned under the name "K 57", to attractive tenants such as the City of Duisburg, a hospital or an energy supply company. In autumn 2009, some 85% of 8,000 sqm is already occupied on a long-term basis.

HAMBURG: FULLY LET FOLLOWING OPTIMISATION

In Hamburg, we reduced a vacancy of some 1,000 sqm in our property in Osterstraße; the occupancy rate now amounts to 100%. The space was appropriately equipped to meet the demands of the market, at the same time, the modernisation has reduced the ongoing operating costs. In the third quarter of 2009, we achieved full letting, which increased rental income by 30%.

Smaller volume sales in the third quarter

Selling properties from our portfolio forms part of DIC Asset AG's business model. It allows us to achieve profits, release tied-up capital and fine-tune our portfolio in respect of regional focal points and types of usage. We are thus continuing with the selective sale of small to medium-sized properties which can be marketed at a profit even in current conditions. In the third quarter of 2009, we sold three smaller properties from our Core and Value Added segments for a figure of EUR 3.3 million and generated a profit of EUR 0.3 million in the process. Overall, this resulted in an increase to EUR 10.2 million in 2009 in the volume of sales from the Core and Value Added segments. Our sales activities resulted in the carrying values and the market values established during the assessment being exceeded. In the previous year we achieved a sales volume of EUR 22.8 million in the Core and Value Added Segments, primarily due to a strong third quarter.

Across all segments, the 2009 sales volume amounted to EUR 34.6 million. Up to September, we participated in sales from our Opportunistic Co-Investments segment to the value of EUR 18.7 million. The largest of these properties was a mixed use property consisting of some 5,000 sqm of office and retail space on Rathausplatz in Eschborn.

MainTor project: Combining project stakes

In the third quarter of 2009, the DIC Group acquired the shares of its previous co-investor Morgan Stanley Real Estate Funds (MSREF) in their entirety and now has an overall holding of 100% in the MainTor project. DIC Asset AG's minority stake increased from 20% to 40%. By combining the stakes in the project, we have simplified the agreement processes and increased our flexibility in the next project and decision-making phases. At the same time, DIC remains open to additional financing partners.

The first phase will start soon: the first stage of construction, the "MainTor Porta", is expected to be approved in spring 2010. The relevant application for construction has now been submitted to the City of Frankfurt for approval. At the end of September 2009, DIC together with the City of Frankfurt started the process for calling in expert opinions for two high-rise buildings. Seven renowned architect firms have been invited to submit designs for the "WinX" and "MainTor Panorama" office blocks. A jury consisting of independent construction experts, representatives from the City of Frankfurt and DIC will nominate a selection of awardees from them.

Sold in the third quarter 2009: Object in Hamburg, Schopenstehl

Frankfurt, MainTor project

Personnel concentrated in property-focused real estate management

As at 30 September 2009, DIC Asset AG employed 102 staff, five more than at the same time in the previous year. The majority of our employees are working directly in the local branches of our asset and property management company DIC ONSITE to let and optimise our property portfolio. There have been no changes compared with the second quarter of 2009.

Number of employees

Total	102	97
Administration	14	13
Property and asset management	79	77
Portfolio management and investment	9	7
	30.09.2009	30.09.2008

-REVENUES AND RESULTS

Stable gross rental income at around EUR 101 million

In the first three quarters of 2009, gross rental income matched the level for the previous year amounting to EUR 100.8 million. In comparison with the second quarter, gross rental incomes fell by EUR 0.6 million (-2%). Some EUR 52.8 million was attributable to the Core segment, EUR 48.0 million to the Value Added Segment. In the Opportunistic Co-Investments segment, no revenues accrue on account of the minority interests; the investments contribute to the profit via income from associated companies.

As at 30 September 2009, net rental income, at EUR 93.5 million, was down EUR 2.7 million year-on-year primarily due to higher risk precaution and a more precise definition of operating costs and apportionable expenses. In comparison with the second quarter, net rental income fell by EUR 0.9 million (-3%). We increased our income from property management services for third parties, mainly as part of our opportunistic co-investments, from EUR 2.4 million to EUR 2.6 million.

Total revenues of EUR 127.6 million were generated. The figure was some EUR 13.0 million (-9%) down on the previous year, on account primarily of fewer sales having taken place.

Properties sold for approximately EUR 10 million

To date, we have sold properties with a volume of around EUR 10.2 million from our portfolio in the Core and Value Added segments in 2009. We have therefore achieved a profit of EUR 0.9 million and have exceeded either the carrying amount or the most recently determined market value in every transaction. In the previous year, sales came to EUR 22.8 million.

Revenues overview

EUR million	9M 2009	9M 2008	9M 2007
Rental income	100.8	101.0	64.4
Revenues from disposal of properties	10.2	22.8	91.2
Other income	16.6	16.8	11.8
Total revenues	127.6	140.6	167.4

Operating costs

The increase in the letting result of 13% demands a particularly intensive level of service in letting properties in the current difficult market environment entailing correspondingly higher financial expenses. As a result and because of the general expansion in our asset and property management activities, our operating costs have increased. Up to September 2009, administrative expenses increased by EUR 1.2 million to EUR 6.9 million, personnel expenses by EUR 1.8 million to EUR 6.7 million. In comparison with the second quarter, personnel expenditure fell by EUR 0.1 million (-4%). The ratio of personnel and administrative expenses (without management fee income for third parties) to rental income thus rose by 2.8 percentage points to 10.9%.

As at 30 September 2009, depreciation stood at EUR 22.7 million. The increase of some EUR 1.7 million (+8%) is primarily attributable to first-time depreciations on property acquisitions and portfolio investments.

EBITDA and EBIT down on the previous year

Most notably due to the lower sales volume, EBITDA and EBIT are down on the previous year. EBITDA totalled EUR 83.5 million (previous year: EUR 92.7 million), while EBIT stood at EUR 60.9 million (previous year: EUR 71.7 million). The EBITDA yield amounted to 65.4% and the EBIT yield to 47.7%.

FFO increased to approximately EUR 36 million

The FFO (Funds from Operations), earnings before taxes, depreciations and profits from sales stood at EUR 35.6 million in the first three quarters. The FFO was increased by EUR 2.0 million (+6%) compared with the previous year, primarily as a consequence of the reduced interest expenses, which were EUR 5.8 million lower. Compared with the previous quarter, the FFO was up EUR 2.4 million (+21%). The comparable FFO for the previous year (adjusted for the effects of syndicating the MainTor project) stood at EUR 33.6 million. The FFO per share amounted to EUR 1.16 (previous year, adjusted EUR 1.07).

Core segment slightly up on previous year

Income before tax in the Core segment increased by EUR 0.1 million (+1%) to EUR 7.3 million. In the Value Added segment, income fell to EUR 7.7 million (previous year: EUR 10.5 million) as sales in the previous year were exclusively out of this segment. In the Opportunistic Co-Investments segment, pre-tax income stood at EUR 5.1 million (previous year: EUR 7.8 million). The Others segment consists mainly of overhead companies (primarily DIC Asset AG and DIC ONSITE); income in this segment amounted to EUR -6.2 million.

Income from stakes increases significantly in the third quarter

As at 30 September 2009, we increased income from associated companies, which consists almost exclusively of opportunistic co-investments, to EUR 5.1 million through the disposal of properties and through the more substantial profit contribution following the increase in the MainTor stake from 20% to 40%. Compared with the second quarter of 2009, the increase amounted to EUR 3.6 million. In the previous year, income of EUR 7.8 million was generated from associated companies.

Earnings overview

EUR million	9M	9M		Q3	Q2
	2009	2008		2009	2009
FFO	35.6	33.6	+6%	13.9		11.5 +21%
EBITDA	83.5	92.7	-10%	27.4	28.6	-4%
EBIT	60.9	71.7	-15%	19.8	20.9	-5%
EBDA	34.2	39.5	-13%	13.1		11.2 +17%
Profit for the period	11.5	18.5	-38%	5.4		3.5 +54%
Earnings per share (EUR)	0.37	0.59	-37%	0.17		0.12 +42%
FFO per share (EUR)	1.16	1.07	+8%	0.44		0.38 +16%

Financing perceptibly less expensive

We have exploited the more favourable terms on the financing market for the long-term optimisation of our financing structure. As at 30 September 2009, our successes had led to a reduction of EUR 5.8 million in financing costs for a virtually comparable total financing volume. Overall, net financing costs were reduced by EUR 4.8 million (-8%) to EUR -52.1 million.

EBDA at EUR 34 million

Earnings before depreciation and amortisation (EBDA) stood at EUR 34.2 million following the third quarter, some EUR 5.3 million (-13%) down on the previous year. Compared with the previous quarter, EBITDA increased by EUR 1.9 million (17%).

Profit for the period increased to EUR 11.5 million

Even though framework conditions remain difficult, we increased the profit for the period to EUR 11.5 million up to the end of the third quarter, which is mainly attributable to our strong, highly profitable portfolio. In comparison with the second quarter, profit increased by EUR 1.9 million (54%). The reduction of EUR 7.0 million (-38%) compared with the previous year can be explained above all by non-recurring contributions from associated companies in the previous year and a lower sales volume in the current year. The post-tax return stood at 9.0% as at 30 September 2009. Earnings per share amounted to EUR 0.37 (previous year: EUR 0.59).

-ASSETS AND FINANCIAL POSITION

Long-term focus provides the basis for our financing

DIC Asset AG has a long-term financing structure. We focus both on long-term sustainability and ensuring that we have sufficient flexibility to exploit market opportunities. Up to 30 September 2009, our loans and borrowings came to EUR 1,591.2 million. Of this figure, the vast majority, a total of 53%, has a term in excess of five years. Only 4% will expire in the next 12 months. The lion's share of that debt, which is due short-term, relates to the Bienenkorbhaus project in Frankfurt, which has now been successfully completed.

Marked reduction in interest costs on loans and borrowings

Interest rates remained low in the third quarter too and we exploited this opportunity to optimise our financing throughout the Group and – without changing the stability of our external financing – to secure more favourable rates for us. As a result, the average interest rate on our loans and borrowings was further reduced to 4.65%, which signifies a reduction in expenses of EUR 5.8 million compared with the previous year on a comparable financing volume. At the end of the third quarter of 2008, the average interest rate still stood at 5.31%.

Financial debt fixed on a long-term basis

Interest rates hedged

The vast majority, namely 87%, of our loans and borrowings are agreed on a fixed rate basis or covered by long-term hedging agreements. We use simply structured financing instruments (interest rate swaps) as hedging instruments to minimise risk and, at the same time, offset possible increases in interest rates. In the event of changes in interest rates, this does not have any impact on earnings but only on Group equity in the balance sheet. 13% of loans and borrowings are subject to variable interest rates, which allows us to benefit directly from the historically low level of interest rates.

Operative cash flow raised to about EUR 29 million

From January to September 2009, cash flow was dominated above all by our property management operations and less investment. Cash flow from operating activities increased by EUR 4.2 million (+17%) to 28.8 million. The fall in net operating profit was virtually offset in particular by the reduction in financing expenses. The cash outflow for investing purposes shrank significantly to EUR 49.6 million, which was attributable, in essence, to fewer acquisitions and increased inflows from previous sales in the current year. Cash flow from financing activities shrank to EUR 14.6 million, primarily as a result of the reduction in investment and a smaller dividend payment for the last financial year.

As at 30 September 2009, cash and cash equivalents amounted to EUR 40.2 million (previous year: EUR 69.2 million).

Cash flow overview

EUR million	9M 2009	9M 2008
Profit for the period	11.5	18.5
Cash flow from operating activities	28.8	24.6
Cash flow from investing activities	-49.6	-178.1
Cash flow from financing activities	14.6	57.4
Net increase in cash and cash equivalents	-6.2	-96.1
Cash and cash equivalents as at 30 September	40.2	69.2

More investment in the portfolio

Up to 30 September 2009, we invested a total of EUR 70.9 million in expanding the portfolio and in measures to maintain the long-term value of our portfolio. EUR 63.6 million was spent on acquisitions following completion, while EUR 7.3 million was invested directly in properties and on our asset and property management services to enhance the appeal of our properties for new tenants, in particular and to develop the quality and capacity of our property management services further. In the same period in the previous year, our activities were focused on the acquisition of properties for a total of EUR 170.0 million.

Total assets match the level of year-end 2008

As at 30 September 2009, total assets, at EUR 2,209.1 million, are virtually unchanged on their level at the end of 2008.

Assets: additions following completion have increased assets

Non-current assets rose by EUR 19.8 million (+1.0%) to EUR 2,075.6 million. This is the result, primarily of the acquisition of properties following completion. Current assets fell by EUR -25.4 million (-16%) to EUR 133.5 million, which is predominantly attributable to the receipt of funds owed on sales.

Liabilities: equity at 23.4%

Equity fell slightly by EUR 16.1 million (-3%) compared with 31 December 2008 to EUR 517.7 million. This is primarily attributable to the increase in the negative hedging reserve from interest rate hedging instruments, which rose to EUR -65.0 million as a consequence of interest rates remaining low. The equity ratio stood at 23.4% as at 30 September 2009 and is 0.7 percentage points down on the figure at the end of 2008. Equity decreased by EUR 10.9 million compared with 30 June 2009.

Non-current debt stable

At EUR 1,608.3 million, non-current debt is only marginally up on the level as at 31 December 2008. Repayment of non-current financial debt was offset by the increase in liabilities from derivatives. Current liabilities rose by EUR 5.8 million (+8%) to EUR 83.1 million, which is caused primarily by reclassifications of loans based on their terms.

Balance sheet overview

EUR million	30.09.2009	31.12.2008
Total assets	2,209.1	2,214.8
Non-current assets	2,075.6	2,055.8
Current assets	133.5	158.9
Equity	517.7	533.8
Non-current debt	1,608.3	1,603.7
Current debt	83.1	77.3
Equity ratio in %	23.4	24.1
Debt ratio in %	76.6	75.9

Balance sheet structure in %

-EVENTS AFTER THE BALANCE SHEET DATE

After the end of the reporting period, we increased our stake in DIC ONSITE from 74.9% to 100% and are thus focussing even more strongly on managing our property portfolio with our own resources.

-RISK REPORT

We provided detailed explanations of DIC Asset AG's risk management and described the risks to which it is exposed in the annual report for 2008, which was published in March 2009. There have been no material changes in companies or the relevant environment since this date.

We have enhanced our risk management in some respects. For example, a multilevel monitoring and controlling system within our receivables management processes prevents non-payment of debts. IT measures have been expanded, most notably to protect against unauthorised access by third parties. In addition, since 1 August 2009, an independent data protection officer has been responsible for monitoring the fact that sensitive data are handled in the correct manner throughout the Group and statutory provisions are complied with.

-TRANSACTIONS WITH RELATED PARTIES

As part of its normal business activities, DIC Asset AG maintains business relations with a number of related companies and persons. In principle, the same conditions apply to transactions with these companies and persons as for comparable transactions with third parties. With the exception of the purchase of the 20% stake in the MainTor project from our co-investor MSREF, there have to date been no material transactions with related parties in 2009.

-OPPORTUNITIES AND FORECAST

In-house property management offers opportunities

We presented the positive opportunities for growth that may emerge in our area of corporate activity in detail in the last annual report. There have been no fundamental changes here. In the current environment, the importance of our presence throughout Germany with our in-house asset and property management organisation DIC ONSITE comes to the fore even more. This was already apparent in the first three quarters of 2009, during which we were able to expand our letting volume in a market that is falling sharply overall and is extremely competitive. Compared with our competitors, we are very well placed to take advantage of additional opportunities in a consistent and efficient manner, particularly as we are largely independent of external property managers. This may have a positive impact, most notably in securing our existing tenants and in increasing our revenues through new tenancies.

Recovery is imminent for the economy as a whole

Overall, 2009 will be affected to an extraordinary degree by the economic slump at the beginning of the year. The slight recovery from the middle of the year can only attenuate the sharp collapse in gross domestic product in 2009 as a whole; a fall of 5% in total is expected, which means that the worst result since the establishment of the Federal Republic is to be expected. The recovery anticipated by leading economic research institutions in the second half of 2009 is based on increasing demand from abroad and is supported by another positive result for the ifo Business Climate index in October. Despite the positive omens, the recovery is still fraught with risk: uncertainty remains with regard to the trend on the employment market, the stability of the financial sector and consequently future lending. At present, the EU commission expects growth of slightly above 1% for 2010.

Letting market remains challenging

The subdued activity on the German letting market will continue even if the economic prospects are looking brighter again. For the fourth quarter, analysts expect a 30% fall on an annual basis and a stable fourth quarter matching the level of previous quarters. Tenants will also remain increasingly cost-sensitive. Competition for companies that are prepared to move will also remain intense, while the majority of existing tenants will ask to renew their tenancies on a shortterm basis instead of moving.

An intensive level of service leads to successful letting

The intensive level of service and the measures we adopt locally in letting properties are successful: we surpassed the previous year's good result in a market environment that has become far more difficult. We are striving to achieve a comparable result for the last quarter too and plan to close 2009 with a stable occupancy rate of between 87% and 88%. At the end of the third quarter 2009, the rate stood at 86.8%. We assume that rental income for the financial year (discounting sales) will be around 2-3% down on the level for the previous year.

Transaction market: far less activity than in the previous year

The investment market was far harder hit by the global economic crisis than the letting market and this will also be reflected in the results for the whole of 2009. Pricing differences between purchasers and vendors as well as the difficult financing terms continue to inhibit any revival in activity. Investors continue to favour properties in the prime location that are fully let on long-term agreements, however, opportunistic transactions will again become more likely from a low level in 2010. At the end of the third quarter of 2009, analysts considered a somewhat more active final quarter was possible, which could lead to a transaction volume for 2009 as a whole of between EUR 10 and 12 billion.

Sales

Against the background of conditions on the transaction market, we are continuing to focus on sales of smaller to medium-sized properties, for which demand remains constant among market players because they are easier to finance. We shall concentrate more on placing larger properties or portfolios at an appropriate time. For the year as a whole, we are planning a transaction volume including opportunistic co-investments of around EUR 65-75 million.

New FFO target of EUR 45-46 million

We achieved a good operating result as at 30 September 2009, with a FFO of EUR 35.6 million. This means that we have already achieved the target set for the year, which we had settled at between EUR 34 and 36 million. This provides impressive evidence of the earnings potential and resilience of our property portfolio even in more challenging environmental conditions. Assuming market conditions remain unchanged, we are expecting a stable fourth quarter in 2009 and are increasing our FFO target for 2009 to between EUR 45 and 46 million.

Share markets on course for recovery

Prices started to rally on global financial markets in March 2009, immediately after the announcement of a relaxation in the reporting rules, and this rally has continued ever since, apart from minor corrections. In the middle of the year, the upward trend, which encompassed financial stocks first and foremost, received broader support from the improvement in the economic outlook. Since then, share indices have moved far from the lows they hit in September 2008 following the shock of the Lehman bankruptcy. By 30 September 2009, the DAX had climbed 18% against the beginning of the year, while the SDAX had even managed 24.8%.

DIC Asset share price has risen sharply

Until the second quarter of 2009, German real estate stocks had been excluded from the broad recovery in prices, with the traditional reliance on large borrowings being regarded as too significant a risk factor by the financial markets. As the economic outlook has improved, this perception has changed and there was no longer anything to prevent a recovery in share prices. Over the year, the EPRA NAREIT Europe Index rose by 24.7%. The rush to make up lost ground by the DIC Asset share, which rose by 44.9% to EUR 8.95 compared with the beginning of the year, was even more impressive. Its growth from the low of EUR 2.55 actually stood at 250%.

Analysts: more "buy" recommendations

We provide our shareholders, investors and analysts with information on DIC Asset AG's prospects, targets and current figures in regular discussions and at events organised by the industry. Most analysts view our share positively; compared with the last quarter, the number of institutions observing the share rose to 14. The clear majority, with a total of 10 recommendations, assessed our share as a "buy". Since 30.06.2009, twelve institutions updated their assessment of our company.

Key figures

	9M 2009	9M 2008
FFO per share in EUR	1.16	1.07
52-week high in EUR	8.95	25.95
52-week low in EUR	2.55	9.90
Closing price for quarter in EUR	8.95	9.90
Market capitalisation in EUR million	281	310
Current share price (as at 10.11.2009) in EUR	9.18

Financial calendar

11.11.2009	Publication of Interim Report Q3/2009
19.11.2009	WestLB Germany Conference	Frankfurt
01.12.2009	Commerzbank Real Estate Conference	Frankfurt
10.03.2010	Publication of the 2009 Annual Report
10.05.2010	Publication of Interim Report Q1/2010
17.08.2010	Publication of Interim Report Q2/2010
09.11.2010	Publication of Interim Report Q3/2010

■ CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE PERIOD FROM 1 JANUARY TO 30 SEPTEMBER 2009

TEUR	01.01.-	01.01.-	01.07.-	01.07.-
	30.09.09	30.09.08	30.09.09	30.09.08
Total revenues	127,556	140,630	42,252	60,062
Total expenses	-66,688	-68,940	-22,502	-32,958
Gross rental income	100,766	100,979	33,477	33,243
Ground rents	-528	-385	-248	-123
Service charge income on principal basis	13,341	14,010	4,359	4,801
Service charge expenses on principal basis	-15,406	-13,990	-5,173	-4,517
Other real estate related operating expenses	-4,719	-4,391	-1,685	-2,011
Net rental income	93,454	96,223	30,730	31,393
Administrative expenses	-6,896	-5,686	-2,365	-1,494
Personnel expenses	-6,662	-4,873	-2,230	-1,366
Depreciation and amortisation	-22,659	-21,017	-7,664	-6,871
Management fee income	2,596	2,390	838	1,049
Other income	628	480	253	148
Other expenses	-530	-576	-139	-355
Net other income	98	-96	114	-207
Investment property net disposal proceeds	10,225	22,770	3,325	20,821
Carrying value of investment property disposal	-9,288	-18,021	-2,998	-16,222
Profit on disposal of investment property	937	4,749	327	4,599
Net operating profit before financing activities	60,868	71,690	19,750	27,103
Share of the profit of associates	5,090	7,835	3,593	924
Net financing costs	-52,095	-56,877	-16,828	-19,822
Profit before tax	13,863	22,648	6,515	8,205
Income tax expense	-2,957	-5,396	-1,537	-2,838
Deferred income tax expense	600	1,206	430	1,320
Profit for the period	11,506	18,458	5,408	6,687
Attributable to equity holders of the parent	11,490	18,400	5,443	6,689
Attributable to minority interest	16	58	-35	-2
Basic (=diluted) earnings per share (EUR)	0.37	0.59	0.17	0.21

■ CONSOLIDATED BALANCE SHEET AS AT 30 SEPTEMBER 2009

ASSETS

TEUR	30.09.2009	31.12.2008
Investment property	2,031,987	2,022,920
Office furniture and equipment	581	641
Investments in associates	24,923	18,708
Other investments	241	241
Intangible assets	173	196
Deferred tax assets	17,696	13,100
Total non-current assets	2,075,601	2,055,806
Receivables from the sale of property	134	19,639
Trade receivables	5,368	8,972
Receivables due from related parties	77,990	76,377
Income taxes receivable	5,383	2,621
Other receivables	2,290	2,671
Other current assets	2,157	2,247
Cash and cash equivalents	40,202	46,417
Total current assets	133,524	158,944
Total assets	2,209,125	2,214,750

EQUITY AND LIABILITIES

TEUR	30.09.2009	31.12.2008
Equity
Issued capital	31,350	31,350
Share premium	530,747	528,450
Hedging and translation reserve	-65,000	-39,521
Reserve for treasury shares	0	-4,977
Reserve from first-time application of IFRS	-2,373	-2,373
Other reserves	1,136	1,136
Retained earnings	20,278	18,193
Total shareholders' equity	516,138	532,258
Minority interest	1,526	1,537
Total equity	517,664	533,795
Liabilities
Interest-bearing loans and borrowings	1,532,664	1,554,752
Deferred tax liabilities	7,280	7,431
Derivatives	68,397	41,462
Other non-current liabilities	0	13
Total non-current liabilities	1,608,341	1,603,658
Interest-bearing loans and borrowings	58,571	19,783
Trade payables	4,240	34,368
Liabilities to related parties	4,733	6,501
Provisions	33	34
Income taxes payable	4,649	5,299
Other liabilities	10,894	11,312
Total current liabilities	83,120	77,297
Total liabilities	1,691,461	1,680,955
Total equity and liabilities	2,209,125	2,214,750

■ CONSOLIDATED STATEMENT OF CASH FLOW

TEUR	30.09.2009	30.09.2008
Operating activities
Net operating profit before interest and taxes paid	70,264	79,331
Realised gains on disposals	-937	-4,749
Depreciation and amortisation	22,659	21,017
Movements in receivables, payables and provisions	895	-637
Other non-cash transactions	-5,289	-9,497
Cash generated from operations	87,592	85,465
Interest paid	-58,433	-64,224
Interest received	4,508	6,890
Income taxes paid	-4,832	-3,539
Cash flow from operating activities	28,835	24,592
Investing activities
Proceeds from sale of investment property	29,240	18,181
Acquisition of subsidiaries	0	-4,245
Dividends received	0	240
Acquisition of investment property	-63,593	-161,564
Capital expenditure on investment property	-7,282	-8,467
Acquisition/disposal of other investments	-2,469	-1,417
Loans to other entities	-5,495	-20,536
Acquisition of office furniture and equipment	-58	-252
Cash flow from investing activities	-49,657	-178,060
Financing activities
Proceeds from other non-current borrowings	44,458	120,424
Repurchase of own shares	7,311	0
Repayment of borrowings	-27,757	-11,323
Dividends paid	-9,405	-51,727
Cash flow from financing activities	14,607	57,374
Net increase in cash and cash equivalents	-6,215	-96,094
Cash and cash equivalents at 1 January	46,417	165,281
Cash and cash equivalents at 30 September	40,202	69,187

■ SEGMENT REPORTING AS AT 30 SEPTEMBER 2009

ENDED AT 30 SEPTEMBER 2009			TEUR	9M 2009	9M 2008	Q3 2009	Q3 2008
TEUR	30.09.2009	30.09.2008	Rental income
			Core	52,760	51,404	17,785	17,342
Operating activities			Value Added	48,005	49,575	15,691	15,901
Net operating profit before interest and taxes paid	70,264	79,331	Opportunistic Co-Investments	0	0	0	0
Realised gains on disposals	-937	-4,749	Other	0	0	0	0
Depreciation and amortisation	22,659	21,017	Group	100,765	100,979	33,476	33,243
Movements in receivables, payables and provisions	895	-637
Other non-cash transactions	-5,289	-9,497	EBITDA
Cash generated from operations	87,592	85,465	Core	48,367	48,811	16,095	16,324
			Value Added	43,344	50,083	14,210	19,290
Interest paid	-58,433	-64,224	Opportunistic Co-Investments	0	0	0	0
Interest received	4,508	6,890	Other	-8,184	-6,187	-2,891	-1,640
Income taxes paid	-4,832	-3,539	Group	83,527	92,707	27,414	33,974
Cash flow from operating activities	28,835	24,592
			EBTDA
Investing activities			Core	19,281	18,328	6,156	6,046
Proceeds from sale of investment property	29,240	18,181	Value Added	18,207	20,301	6,682	7,883
Acquisition of subsidiaries	0	-4,245	Opportunistic Co-Investments	5,090	7,835	3,593	924
Dividends received	0	240	Other	-6,056	-2,799	-2,252	223
Acquisition of investment property	-63,593	-161,564	Group	36,522	43,665	14,179	15,076
Capital expenditure on investment property	-7,282	-8,467
Acquisition/disposal of other investments	-2,469	-1,417	EBT
Loans to other entities	-5,495	-20,536	Core	7,256	7,232	2,131	2,346
Acquisition of office furniture and equipment	-58	-252	Value Added	7,741	10,528	3,100	4,739
Cash flow from investing activities	-49,657	-178,060	Opportunistic Co-Investments	5,090	7,835	3,593	924
			Other	-6,224	-2,947	-2,309	196
			Group	13,863	22,648	6,515	8,205

■ RECORDED GAINS AND LOSSES AS AT 30 SEPTEMBER 2009

TEUR	9M 2009	9M 2008
Fair value of cash flow hedges	-22,868	3,226
Fair value of cash flow hedges of associates	-2,611	225
Recorded directly in equity	-25,479	3,451
Profit for the period	11,506	18,458
Recorded gains and losses	-13,973	21,909
Equity holders of the parent	-13,989	21,851
Minority interest	16	58

■ CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS AT 30 SEPTEMBER 2009

	Issued Capital	Share premium	Reserve for treasury	Reserve for cash flow	Reserve from first-time application	Other reserves	Retained earnings	Minority interest	Total
TEUR			shares	hedges	of IFRS
Status as of 31 December 2007	31,350	528,450	0	7,769	-2,373	1,136	44,842	1,574	612,748
Dividends 2007							-51,727	0	-51,727
Profit for the period							18,400	58	18,458
Gains from cash flow hedges*				3,226					3,226
Gains from cash flow hedges of associates*				225					225
Repayment of minority interest								-51	-51
Status as of 30 September 2008	31,350	528,450	0	11,220	-2,373	1,136	11,515	1,581	587,879
Profit for the period							6,678	38	6,716
Loss from cash flow hedges*				-44,484					-44,484
Loss from cash flow hedges of associates*				-6,257					-6,257
Repurchase of own shares			-4,977						-4,977
Repayment of minority interest								-82	-82
Status as of 31 December 2008	31,350	528,450	-4,977	-39,521	-2,373	1,136	18,193	1,537	533,795
Dividends 2008							-9,405	0	-9,405
Profit for the period							11,490	16	11,506
Loss from cash flow hedges*				-22,868					-22,868
Loss from cash flow hedges of associates*				-2,611					-2,611
Repurchase of own shares			-2,270						-2,270
Sales of own shares		2,297	7,247						9,544
Repayment of minority interest								-27	-27
Status as of 30 September 2009	31,350	530,747	0	-65,000	-2,373	1,136	20,278	1,526	517,664

* deferred taxes deducted

General information on reporting

Pursuant to § 37 x paragraph 3 of the Securities Trading Act (WpHG), the interim financial statements shall consist of interim consolidated financial statements and a consolidated management report. These interim consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) for interim reporting. The consolidated management report was prepared in accordance with the applicable provisions of the WpHG. The initial inclusion of the stake in the MainTor project purchased from our co-investor MSREF is in accordance with IAS 28 in conjunction with IFRS 3 (rev. 2008).

The quarterly accounts for the consolidated companies are based on uniform accounting and measurement principles. The consolidation, currency translation, recognition and measurement methods used are unchanged compared with the 2008 consolidated financial statements.

Notes to the consolidated financial statements

Up to September 2009, external loans of EUR 44.5 million were taken up. These are being used to finance the Düsseldorf Nordstraße and VP Düsseldorf Nürnbergerstrasse (EUR 17.3 million) properties from the V6A portfolio, one further property in the RMN portfolio (EUR 1.6 million), a tranche for the DIC 26 portfolio (EUR 21.0 million) and the development of the FraSpa Bienenkorbhaus property on Frankfurt's Zeil (proportionate share of EUR 3.4 million). Of this, EUR 38.7 million is hedged through interest rate swaps.

Modifications in line with EPRA Best Practices Recommendations

We have implemented reporting-related changes in accordance with the EPRA Best Practices Recommendations, which have been in existence since July 2009. The reporting-related changes affect the following issues:

• The costs accruing from vacant properties, hitherto reported in the expenses for operating and incidental costs (EUR 1.7 million/previous year: EUR 1.8 million) have been reclassified under the item "Other property-related expenses" in accordance with the recommendations.

• The expenditure from the amortisation of the handling fees which accrued in connection with the financial liabilities (EUR 0.7 million/previous year: EUR 0.7 million) was reclassified from administrative expenses to interest expenses.

The reporting from the previous year was corrected accordingly.

Dividend

During the General Shareholders' Meeting of 7 July 2009, the shareholders agreed a dividend of EUR 0.30 per share. The payout of the dividend amounting to EUR 9.4 million followed on 8 July 2009.

Above left: München, Hanauer Landstraße Above right: Neubrandenburg, Alfred-Lythall-Straße Below: Hannover, Vahrenwalder Straße

■ TO DIC ASSET AG

We have reviewed the condensed interim consolidated financial statements of the DIC Asset AG, Frankfurt am Main, comprising the balance sheet, income statement, statement of recognized income and expense, cash flow statement, statement of changes in equity and selected explanatory notes – together with the interim group management report of DIC Asset AG, Frankfurt am Main for the period from January 1 to September 30, 2009, which are part of quarterly financial report according to § 37x WpHG ("Wertpapierhandelsgesetz": German Securities Trading Act). The preparation of the condensed interim consolidated financial statements in accordance with those International Financial Reporting Standards (IFRS) applicable to interim financial reporting as adopted by the EU, and of the interim group management report in accordance with the requirements of the WpHG applicable to interim group management reports, is the responsibility of the Company´s management. Our responsibility is to issue a review report on the condensed interim consolidated financial statements and on the interim group management report based on our review.

We conducted our review of the condensed interim consolidated financial statements and the interim group management report in accordance with the German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with a certain level of assurance, that the condensed interim consolidated financial statements have not been prepared, in material aspects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, and that the interim group management report has not been prepared, in material aspects, in accordance with the requirements of the WpHG applicable to interim group management reports. A review is limited primarily to inquiries of company employees and analytical assessments and therefore does not provide the assurance attainable in a financial statement audit. Since, in accordance with our engagement, we have not performed a financial statement audit, we cannot issue an auditor´s report.

Based on our review, no matters have come to our attention that cause us to presume that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU or that the interim group management report has not been prepared, in material respects, in accordance with the requirements of the WpHG applicable to interim group management reports.

Nürnberg, 9 November 2009

Rödl & Partner GmbH Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft

Dr. Rödl Danesitz Wirtschaftsprüfer Wirtschaftsprüfer (German Public Auditor) (German Public Auditor)

■ LONGER-TERM OVERVIEW BY QUARTER

EUR million	Q1 2008	Q2 2008	Q3 2008	Q4 2008	Q1 2009	Q2 2009	Q3 2009
Gross rental income	33.8	33.9	33.3	33.5	33.2	34.1	33.5
Proceeds from the sale of real estate	0.0	2.0	20.8	27.1	4.4	2.5	3.3
Total revenues	39.1	41.5	60.1	67.5	43.6	41.7	42.3
EBITDA	28.8	29.8	34.0	32.4	27.5	28.6	27.4
EBIT	21.9	22.5	27.1	25.5	20.2	20.9	19.8
FFO	11.0	12.2	10.5	9.0	10.2	11.5	13.9
EBDA	10.2	15.7	13.6	13.7	9.9	11.2	13.1
Profit for the period	3.3	8.4	6.7	6.8	2.6	3.5	5.4
Earnings per share (EUR)	0.11	0.27	0.21	0.21	0.08	0.12	0.17
Cash flow from operating activities	10.4	8.2	6.0	7.9	9.2	9.6	10.1
Market value of real estate assets*	2,385.6	2,382.6	2,358.1	2,161.8	2,184.4	2,179.7	2,217.6
Total assets	2.251.4	2,229.9	2,211.1	2,214.8	2,214.4	2,223.2	2,209.1
Equity	604.2	593.0	582.9	533.8	512.8	528.6	517.7
Equity ratio in %	26.8	26.6	26.4	24.1	23.2	23.8	23.4
Debt	1,647.2	1,636.9	1,628.2	1,681.0	1,701.6	1,694.6	1,691.5
Debt ratio in %	73.2	73.4	73.6	75.9	76.8	76.2	76.6

* Acquisitions during the year are taken into account at the cost of acquisition

PORTFOLIO OVERVIEW

As at 30.09.2009

	Core	Value Added	Opportunistic Co-Investments	Total
Number of properties	47	141	138	326
Portfolio volume in EUR million*	971.3	966.3	280	2,217.6
Portfolio proportion	44%	44%	12%	100%
Annualised net rent	67	61	16	144
Lettable area in sqm	455,300	652,200	171,200	1,278,700
Rental income per sqm in EUR	12.15	9.35	8.86	10.41
Vacancy rate	2.1%	19.8%	17.8%	13.2%

* Market values as at 31.12.2008

Portfolio growth

EUR million

REGIONAL DISTRIBUTION OF PROPERTIES

by lettable area in sqm, as at 30 September 2009

DIC Asset AG

Grünhof · Eschersheimer Landstraße 223 D-60320 Frankfurt am Main

Tel. +49 69 9 45 48 58-0 · Fax +49 69 9 45 48 58-99 ir @dic-asset.de · www.dic-asset.de

This report is also available in German (binding version).

Concept and realisation: LinusContent AG, Frankfurt am Main www.linuscontent.com