GPT GROUP — Regulatory Filings 2004

Dec 16, 2004

17 December 2004

Level 16 157 Liverpool Street SYDNEY NSW 2000

www.stockland.com.au

Tel: 02 9321 1500 Fax: 02 9321 1599

Companies Announcement Officer Australian Stock Exchange 20 Bridge Street Sydney NSW 2000

Stockland Trust Management Limited ("STML") - second supplementary Bidder's Statement relating to the takeover bid for General Property Trust ("Offer")

In accordance with section 647(3)(b) of the Corporations Act 2001, please find attached a copy of STML's second supplementary bidder's statement to the original bidder's statement lodged with the Australian Securities and Investments Commission on 24 November 2004 in relation to the Offer.

The second supplementary bidder's statement will be despatched to GPT unitholders next week.

Yours faithfully.

Up Heft

Phillip Hepburn Group Secretary

Tel: 02 9561 2630 Fax: 02 9561 2627

Stockland Corporation Limited ACN 000 181 733 Stockland Trust Management Limited ACN 001 900 741 AFSL No. 241190 As Responsible Entity for Stockland Trust ARSN 092 897 348

SECOND SUPPLEMENTARY BIDDER'S STATEMENT

Offer by Stockland Trust Management Limited (ABN 86 001 900 741) as Responsible Entity for Stockland Trust (ARSN 092 897 348) to purchase all your ordinary units in General Property Trust (ARSN 090 110 357)

This document is the second supplementary bidder's statement to the Bidder's Statement dated 24 November 2004 ("Bidder's Statement") issued by Stockland Trust Management Limited (as responsible entity for Stockland Trust) ("STML") and lodged at the Australian Securities and Investments Commission ("ASIC") on 24 November 2004, in relation to STML's offer ("Offer") for all of the ordinary units in General Property Trust ("GPT").

A First Supplementary Bidder's Statement was lodged with ASIC on 9 December 2004 ("Previous Supplementary Bidder's Statement"). This Second Supplementary Bidder's Statement is to be read together with the Bidder's Statement and the Previous Supplementary Bidder's Statement.

Unless the context requires otherwise, defined terms in the Bidder's Statement have the same meaning in this Second Supplementary Bidder's Statement.

This Second Supplementary Bidder's Statement provides GPT unitholders with updated information regarding Stockland and the Offer following:

• Stockland's acquisition of Foster's Group Limited's development business known as Lensworth which was announced on 9 December 2004; and
• The estimated distribution on Stockland Securities for the six months to 31 December 2004 of 19.3 cents per stapled security, announced on 14 December 2004.

$1₁$ Overview of Transaction and Lensworth Business

Transaction Overview

On 9 December 2004 Stockland announced that it had successfully acquired Foster's Group Limited's property development portfolio known as Lensworth for a cost of \$825 million plus working capital of \$21 million.

The acquisition of the Lensworth portfolio is consistent with Stockland's strategy to strengthen its residential development business, with the aim of increasing market share, achieving economies of scale and growing profits.

Lensworth's portfolio is comprised of a group of high quality, long-term, primarily large, master planned urban community based projects which are complementary to Stockland's existing portfolio. Most of the properties are located in key growth corridors currently targeted by Stockland. There is minimal cross over with Stockland's existing land bank.

The portfolio consists of 17 projects at varying stages of development that contain approximately 29,600 lots with an estimated end value in excess of \$6.7 billion.

Stockland undertook extensive due diligence and a rigorous valuation of the Lensworth portfolio. Each project was valued separately on the basis of the net present value of future ungeared cash flows by applying market hurdle rates reflecting the risk associated with each project.

The total acquisition cost (including costs of acquisition and working capital) was debt funded and Stockland's gearing immediately following the transaction has increased to approximately 31% on the basis of debt to total tangible assets. This is well within Stockland's target range of 25% to 35%. It is Stockland's intention to hedge this additional debt in the near term.

The transaction was structured by way of a share sale agreement and Stockland has employed 93 of Lensworth's 104 staff.

The Lensworth Business ("Lensworth")

Lensworth was the property development arm of Foster's Group Limited. The Lensworth Group has over 40 years experience in the development of urban communities in Australia.

The Lensworth portfolio consists of 17 projects at varying stages of development that contain approximately 29,600 lots with an estimated end value in excess of \$6.7 The charts below depict Lensworth's portfolio by state for total lots billion. controlled and their end value as at 9 December 2004.

(1) Includes 85 residential super lots which could potentially yield approximately 2,100 medium density residential lots and excludes commercial lots.

Impact on Stockland's Development Division

Following the Lensworth acquisition, Stockland's Development Division has over 66,000 lots under its control with a book value of approximately \$2.0 billion and an end value of approximately \$14.8 billion.

Following the Lensworth acquisition, Stockland will own approximately 97% of the lots it has under its control with the balance being under joint venture arrangements. Majority of product is targeted at the owner-occupier sector of the residential market.

The charts below depict Stockland's Development Division assets by state for lots controlled and their end value as at 31 October 2004, adjusting for the impact of the Lensworth acquisition.

Source: Stockland

(1) Includes 85 residential super lots which could potentially yield approximately 2,100 medium density residential lots and excludes commercial lots.

Impact on Stockland's Residential Estates Business

The Lensworth acquisition will position Stockland as the largest residential land developer in Australia.

Following the Lensworth acquisition, Stockland's Residential Estates business portfolio will comprise 85 projects with a book value of approximately \$1.8 billion. The projects contain more than 64,000 lots and have an end value of approximately \$12.8 billion. As a percentage of total lots, residential estates account for approximately 97% of all lots with the balance being apartment sites.

Stockland's current annualised sales rate is in excess of 3,000 lots. This increases to in excess of 4,000 lots as a result of the Lensworth acquisition.

In addition to increasing Stockland's exposure to the Australian residential property market, the acquisition of Lensworth will alter the geographic exposure of Stockland's Australian residential property development business from that to which it is currently exposed. The acquisition will provide Stockland with increased exposure to the south east Queensland residential market, which is widely acknowledged as being Australia's most robust, long-term growth region.

The change in geographic exposure is illustrated in the charts below.

$2.$ Highlights for GPT Unit Holders

The impact of the Lensworth acquisition on Stockland on a standalone basis and on the Merged Entity is outlined below.

Stockland's Earnings and Distributions

It is anticipated that the Lensworth acquisition will have a positive but immaterial impact on Stockland's earnings per security in the year ending 30 June 2005.

Accordingly, Stockland's Directors have maintained their earnings forecast for the year ending 30 June 2005, confirming their previous earnings forecast of 39.7 cents per security.

Stockland's Directors have also maintained their distribution forecast for the year ending 30 June 2005, confirming their previous distribution forecast of 38.8 cents per security.

GPT's Standalone Forecast Earnings and Distributions

As Stockland's Directors have not altered their Stockland earnings or distributions forecasts for the year ending 30 June 2005, the earnings and distributions uplift forecast for GPT Unit Holders post merger with Stockland is maintained.

Accordingly, following the Lensworth acquisition, Stockland maintains that the Offer will provide GPT Unit Holders:

• An 8.4% increase in earnings per unit to 24.4 cents per unit compared to $\bullet$ GPT's 2005 standalone forecast earnings of 22.5 cents per unit;
• A 7.1% increase in distributions per unit to 24.1 cents per unit compared to $\bullet$ GPT's 2005 standalone forecast distributions of 22.5 cents per unit.

Earnings before Interest and Tax (EBIT) Mix

The Lensworth acquisition will not alter Stockland's forecast EBIT mix in the year ending 30 June 2005 or the Merged Entity's Pro Forma EBIT mix in the year ending 30 June 2005. This is because the impact on forecast EBIT is positive but immaterial.

Total Assets and Total Tangible Assets

As a result of the Lensworth acquisition:

• Stockland's total assets have increased by approximately \$0.9 billion, from $\bullet$ \$7.2 billion to approximately \$8.1 billion; and
• Stockland's total tangible assets have increased by approximately \$0.9 billion, $\bullet$ from \$7.0 billion to approximately \$7.9 billion.

As a result of the Lensworth acquisition:

• The Merged Entity's total assets would increase by approximately \$0.9 $\bullet$ billion, from \$17.4 billion to approximately \$18.3 billion; and
• The Merged Entity's total tangible assets would increase by approximately $\bullet$ \$0.9 billion, from \$15.2 billion to approximately \$16.1 billion.

Gearing

As a result of the Lensworth acquisition, Stockland's gearing on a pro forma standalone basis has increased to approximately 31.1% as at 30 June 2004, as measured by debt to total tangible assets. This is well within Stockland's target range of 25% to 35%. This is higher than Stockland's gearing of 24.1% as at 30 June 2004 on the same basis, prior to the Lensworth acquisition.

As a result of the Lensworth acquisition, the Merged Entity would have gearing of approximately 30.6% as measured by debt to total tangible assets. This is higher than the 27,3% gearing level previously forecast for the Merged Entity prior to the Lensworth acquisition.

The Merged Entity's gearing level of 30.6% is the same as GPT's gearing of 30.6% as at 30 September 2004, as measured on the same basis.

Credit Rating

Following Stockland's acquisition of the Lensworth business, the credit rating agency Standard & Poor's has affirmed its "A-" corporate credit rating of Stockland, with Stockland remaining on CreditWatch with positive implications.

Development Division

As a result of the Lensworth acquisition, Stockland's Development Division has increased significantly in terms of both scope and diversity, and now represents approximately 25.4% of Stockland's total tangible assets.

Stockland's Development Division portfolio has increased from 79 projects containing approximately 36,800 lots with an end value in excess of \$8 billion to 96 projects containing more than 66,000 lots with an end value of approximately \$14.8 billion.

Residential Estates Business

As a result of the Lensworth acquisition, Stockland has become the largest residential land developer in Australia.

Stockland's residential estates business portfolio has increased from 68 projects with a book value of \$1.0 billion, containing approximately 34,500 lots with an end value in excess of \$6 billion to 85 projects with a book value of approximately \$1.8 billion. containing more than 64,000 lots with an end value of approximately \$12.8 billion.

Stockland's current annualised sales rate is in excess of 3,000 lots. This increases to in excess of 4,000 lots as a result of the Lensworth acquisition.

Employees

As a result of the Lensworth acquisition, Stockland has employed an additional 93 staff. This additional employment increases the number of people employed by Stockland's Development Division from 250 to 343 people and the number of people employed by Stockland from over 1,100 to over 1,190 people (including hotel staff).

3. Financial Impact of the Lensworth Acquisition

$3.1$ Statements of Financial Performance

The acquisition of Lensworth occurred on 9 December 2004 and is forecast to have a positive but immaterial impact on Stockland's earnings per security for the year ending 30 June 2005, which have been previously forecast at 39.7 cents per security.

Stockland's Directors have maintained their forecasts for both earnings per security and distribution per security for the year ending 30 June 2005.

In forming this view the Directors have considered:

• The results of extensive due diligence on Lensworth conducted by Stockland management;
• The fair values attributed to Lensworth assets as a result of the above due $\bullet$ diligence; and
• That the likely benefit of synergies arising from the merging of Lensworth $\bullet$ with Stockland's Development portfolio will not be realised during the year ending 30 June 2005.

$3.2$ Statements of Financial Position

Set out below are the following statements of financial position:

• Audited GPT Statement of Financial Position as at 30 June 2004; $\bullet$
• Audited Stockland Statement of Financial Position as at 30 June 2004; $\bullet$
• Pro Forma Stockland Statement of Financial Position as at 30 June 2004, $\bullet$ based on the audited Stockland Statement of Financial Position as at 30 June 2004 adjusted for material Stockland transactions announced subsequent to 30 June 2004 (refer $3.3(a)$ ); and
• Revised Pro Forma Merged Entity Statements of Financial Position under the $\bullet$ 100% and 50.1% ownership scenarios based on the audited Stockland and GPT Statements of Financial Position as at 30 June 2004 adjusted for material Stockland and GPT transactions announced subsequent to 30 June 2004 (refer $3.3(a)$ and $3.3(b)$ respectively) and the impact of the Offer for GPT (refer $3.3(c)$ to $3.3(e)$ ).

Statements of Financial Position

		Audited GPT as at 30 June 2004	Andited Stockland as at 30 June 2004	Pro Forma (2) Stockland as at 30 June 2004	Pro Forma Merged Entity
					as at 30 June 2004	as at 30 June 2004
	Note	\$000	S000	\$000	(100%) \$000	$(50.1\%)$ \$000
Current assets
Cash assets		52,500	206,652	185,105	188.305	188,305
Receivables		48,500	67,148	79,714	128.214	128,214
Inventories			300,888	379.643	379,643	379,643
Other assets		12.000	44,800	45,553	57,553	57,553
Total current assets		113,000	619,488	690,015	753,715	753,715
Non current assets
Receivables			87.716	104,292	104,292	104,292
inventories.		$\overline{a}$	794,883	1,592,714	1,592,714	1,592,714
Investment properties		7,758,900	4,750,045	4,683,795	12,701,395	12,701,395
Other financial assets			22,230	22,230	22,230	22,230
Property, plant and equipment			21,762	21,762	21,762	21,762
Investments accounted for using
the equity method		9.200	627,466	627.466	636,666	636,666
intangible assets		ä,	269,685	269,685	2,263,222	1,279,924
Deferred tax assets			8,345	8,345	8.345	8,345
Other assets		99,700	11,348	12,569	112,269	112,269
Total non current assets		7,867,800	6,593,480	7,342,858	17,462,895	16,479,597
Total assets		7,980,800	7,212,968	8,032,873	18,216,610	17,233,312
Current Habilities
Payables		149,300	125,744	132,349	281,649	281,649
Interest bearing liabilities		1,170,000	150,000	890,744	2,060,744	2,060,744
Current tax liabilities			28,287	28,287	28,287	28,287
Distribution/dividend payable		110,900	236,410	160,797	216,208	216,208
Other provisions			12,737	17,248	12,737	12,737
Other liabilities			24,909	24,909	24,909	24,909
Total current liabilities		1,430,200	578,087	1,194,334	2,624,534	2,624,534
Non current liabilities
Payables			58,007	96,676	96,676	96,676
Interest bearing liabilities		1,027.000	1,523.717	1,523.717	2,822.717	2,822,717
Deferred tax liabilities			19,248	19,248	19,248	19,248
Provisions			857	857	857	857
Total non current Habilities		1,027,000	1,601,829	1,640,498	2,939,498	2,939,498
Total liabilities		2,457,200	2,179,916	2,834,832	5,564,032	5,564,032
Net assets		5,523,600	5,033,052	5,198,041	12,652,578	11,669,280
Equity
Contributed equity		4,598,500	4,373,508	4,525,922.	11,993,259	8,267,058
Reserves		918,200	575,850.	588,650	575,850	575,850
Retained profits		6,900	83,694	83,469	83,469.	83,469
Total parent entity interest		5,523,600	5,033,052	5,198,041	12,652,578	8,926,377
Outside equity interest	1					2,742,903
Total equity		5,523,600	5,033,052	5,198,041	12,652,578	11,669,280
Securities on issue (000's).		2,016,717	1,265,632	1,294,394	2,519,616	1,908,701
Gearing (Debt/Total Tangible Assets)		27.5%	24.1%	31.1%	30.6%	30.6%
NTA per security (\$)		2.74	3.76	3.81	4.12	4.01

1. If Stockland achieves control of GPT, but not 100%, it will consolidate the whole of GPT and the non-Stockland interest in GPT will be reflected in outside equity interest.
   2. Pro Forma Stockland refers to Stockland's a

$3.3$ Pro Forma adjustments underlying the preparation of the Pro Forma Statements of Financial Position

$(a)$ Significant Stockland transactions announced subsequent to 30 June 2004

The Pro Forma Stockland and Merged Entity Statements of Financial Position include the impact of the following material Stockland transactions announced subsequent to 30 June 2004:

• of 25.587.391 issue securities under the Stockland Distribution/Dividend Reinvestment Plan on 31 August 2004 at an issue price of \$5.30 per security, raising \$135.6 million;
• issue of 3,173,504 securities under the Stockland Executive Security and Staff Security Schemes on 31 August 2004 at an issue price of \$5.30 per security, raising \$16.8 million;
• sale of Imperial Arcade, Sydney (proceeds \$90 million) and the acquisition of The Pines, Melbourne (purchase price \$116 million) by way of an asset swap with the Westfield Group. The price differential of \$26 million was paid by Stockland to Westfield on the settlement date (1 November 2004):
• The acquisition of Lensworth for \$825 million plus \$21 million for working capital occurred on 9 December 2004 and was entirely debt funded. Short term debt has been utilised initially to fund the Lensworth acquisition, and this has been reflected in the Pro Forma Stockland and Merged Entity Statement of Financial Position. It is management's intention to refinance this debt with new long term debt in the near future;
• The sale of 50 Miller Street, North Sydney for \$36.25 million on 17 December 2004; and
• The sale of 37-49 and 51-57 Pitt Street, Sydney for \$68.8 million on 20 December 2004.

Significant GPT transactions announced subsequent to 30 June $(b)$ 2004

The Pro Forma Merged Entity Statements of Financial Position include the impact of the following material GPT transactions announced subsequent to 30 June 2004:

• acquisition of P&O Australia Resorts ("POAR") for \$225 million in July 2004:
• termination, on 30 September 2004, of the Joint Venture $\bullet$ Investment Agreement ("JVIA") in respect of Sunshine Plaza, Maroochydore, giving GPT and APPF Retail full entitlement to all future income from the centre. GPT's cost to terminate the JVIA was \$57 million; and

sale, in November 2004, of the IKEA Building, Prospect (proceeds \$7.5 million) and Springwood Homemaker Centre (proceeds \$13 million).

$\epsilon$ The acquisition of GPT occurred on 1 July 2004

For the purposes of the revised Pro Forma Merged Entity Statements of Financial Position, the acquisition of GPT is assumed to have occurred on 1 July 2004. It is market practice to base the pro forma statement of financial position on the most recent audited or reviewed financial statements.

Goodwill arising from the acquisition of GPT $(d)$

Determining the actual fair value adjustments can only be made with full access to the underlying accounting and property records of GPT. Any increase or decrease in net assets acquired, or fair value of Stockland Securities, will cause a corresponding decrease or increase in goodwill on acquisition.

The Directors have undertaken a preliminary assessment of the fair value of the consideration and the fair value of the net assets to be acquired under the Offer for GPT. The Directors have based their estimate of the fair value of the consideration on the Stockland Security price prior to the announcement of the Offer. The Directors have also considered the market value of the GPT properties and, based on the publicly available information disclosed by GPT, consider the value to be at least equal to the value disclosed in the GPT statement of financial position as at 30 June 2004.

The Directors are of the opinion that 20 years is the appropriate period over which to amortise the goodwill on acquisition.

The issue price of the Stockland Securities which are to be issued under the Offer will be equal to the weighted average market price of Stockland Securities during the five Business Days immediately prior to the date on which or as at which the application price for the Stockland Securities is to be calculated.

The Directors' Forecasts assume goodwill on acquisition of GPT of approximately \$2 billion (under the 100% ownership scenario) and approximately \$1 billion (under the 50.1% ownership scenario).

Additional borrowings in respect of the acquisition of GPT $(e)$

Under both the 50.1% and the 100% ownership scenarios, additional borrowings of \$47 million have been assumed to arise in the Merged Entity to fund various transaction costs of both Stockland and GPT.

$\mathbf{4}$ New Risks

Stockland is currently exposed to risk associated with both the Australian residential property market and debt and gearing levels. Other than as described below the risks associated with these factors are not materially different from those already described in the Bidder's Statement. However, the acquisition of Lensworth will cause the quantum of exposure to these risks to increase proportionately beyond that to which Stockland, on both a standalone basis and a Merged Entity basis, is currently exposed.

As a result of the Lensworth acquisition:

• Stockland's exposure to the Australian residential property market on both a standalone basis and a Merged Entity basis, will increase substantially, both in terms of assets and, beyond the year ending 30 June 2005, in terms of EBIT:
• Stockland's geographic exposure to sectors within the Australian residential property market on both a standalone basis and a Merged Entity basis, will change, both in terms of assets and, beyond the year ending 30 June 2005, in terms of EBIT: and
• Stockland's debt and gearing levels, both on a standalone basis and a $\bullet$ Merged Entity basis, will also increase considerably above current levels.

In relation to Stockland on both a standalone and on a Merged Entity basis, an increase in exposure to the Australian residential market and higher debt and gearing levels, separately and together, will increase the level of risk associated with Stockland Securities.

This increased risk may affect the price at which Stockland Securities trade on ASX as well as Stockland's future earnings and asset values and the relative attractiveness of Stockland Securities.

$\leq$ Additional information

On 14 December 2004, Stockland confirmed that its securities will go ex distribution/dividend on 23 December 2004 and advised that the estimated payout rate is 19.3 cents per ordinary stapled security.

The exact details of the distribution/dividend rate will be confirmed on 8 February 2005 when Stockland expects to announce its half yearly results and lodge its Appendix 4D. The payment will be made on 28 February 2005.

GPT Unit Holders who accept the Stockland Offer will not be entitled to receive this distribution

6. Independent Accountant's Report

A copy of the Independent Accountant's Report is attached in Annexure A.

Authorisation

A copy of this Second Supplementary Bidder's Statement was lodged with ASIC on 17 December 2004. Neither ASIC nor any of its officers takes any responsibility for the contents of this Second Supplementary Bidder's Statement.

SIGNED by HUGH THORBURN on behalf of STML, who is authorised to sign this Second Supplementary Bidder's Statement pursuant to a resolution passed by all the directors of STML on 17 December 2004.

17 December 2004 Dated:

Hugh Thorburn Director

Annexure A - Independent Accountant's Report

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17 December 2004

Dear Sirs

Introduction $\mathbf{I}$

This report has been prepared at the request of the Directors of Stockland Trust Management Limited for inclusion in the Second Supplementary Bidder's Statement to be dated 17 December 2004.

This report should be read in conjunction with our previous Independent Accountant's Report dated 23 November 2004 set out in section 8 of the Bidder's Statement dated 24 November 2004 which included a report on the forecast statements of financial performance for the year ending 30 June 2005 of Stockland and the Pro Forma Merged Entity. As set out in section 3.1 of the Second Supplementary Bidder's Statement, there has been no change to the forecast statement of financial performance of Stockland for the year ending 30 June 2005.

Deloitte Corporate Finance Pty Limited ("Deloitte") is wholly owned by Deloitte Touche Tohmatsu and holds the appropriate Australian Financial Services licence for the issue of this report. References to Stockland and other terminology used in this report have the same meaning as defined in the Second Supplementary Bidder's Statement.

2. Scope of Report

We have been requested to review:

• The historical financial information, as set out in section 3.2 of the Second Supplementary Bidder's Statement, which comprises:
• the Statement of Financial Position of GPT as at 30 June 2004; and $\equiv$
• the Statement of Financial Position of Stockland as at 30 June 2004

and report whether anything has come to our attention which causes us to believe that the historical financial information has not been correctly extracted from the:

• audited financial statements of Stockland for the year ended 30 June 2004; $\mathbf{r}$
• audited financial statements of GPT for the period ended 30 June 2004
• The pro-forma historical financial information, as set out in section 3.2 of the Second Supplementary Bidder's Statement, which comprises:

Deloitte.

• the pro forma unaudited Statement of Financial Position of Pro Forma Stockland as at 30 June 2004 assuming that all the significant Stockland transactions announced subsequent to 30 June 2004. including the recent acquisition of Lensworth, as set out in section 3.3 of the Second Supplementary Bidder's Statement, occurred on 1 July 2004:
• the pro forma unaudited Statement of Financial Position of the Merged Entity as at 30 June 2004 $\overline{\phantom{0}}$ assuming the acquisition of GPT occurred on 1 July 2004 and Stockland acquires 100% of the GPT units: and
• the pro forma unaudited Statement of Financial Position of the Merged Entity as at 30 June 2004 assuming the acquisition of GPT occurred on 1 July 2004 and Stockland acquires 50.1% of the GPT units:

and report whether anything has come to our attention which causes us to believe that the pro-forma historical financial information, as set out in section 3.2 of the Second Supplementary Bidder's Statement, has not been accurately compiled on the basis of:

• the audited Statement of Financial Position of Stockland as at 30 June 2004 ("the Stockland Statement of Financial Position");
• the audited Statement of Financial Position of GPT as at 30 June 2004 ("the GPT Statement of Financial Position"): and
• the Directors' pro forma adjustments set out in section 3.3 of the Second Supplementary Bidder's Statement.

Our review of the historical financial information and the pro-forma historical financial information has been conducted in accordance with AUS 902 "Review of Financial Reports" applicable to review engagements.

Our review is substantially less in scope than an audit examination conducted in accordance with Australian Auditing Standards and provides less assurance than an audit. Accordingly, we have not performed an audit and do not express an audit opinion.

Financial Information and Procedures Applied 3.

3.1 Stockland historical financial information

The historical financial information set out in section 3.2 of the Second Supplementary Bidder's Statement has been extracted from the financial statements of Stockland for the year ended 30 June 2004.

The financial statements of Stockland for the year ended 30 June 2004 were audited by KPMG in accordance with Australian Auditing and Assurance Standards. The audit opinion issued to the members of Stockland relating to those financial statements was unqualified.

The historical financial information is presented in an abbreviated form in so far as it does not include all of the disclosures required by the Australian Accounting Standards applicable to annual financial reports prepared in accordance with the Corporations Act 2001 ("Corporations Act"). The financial statements, as audited at 30 June 2004, are available on the Stockland website.

For the purposes of the Second Supplementary Bidder's Statement, Deloitte has undertaken such procedures as it considered necessary in the circumstances for the purpose of ensuring that the information has been correctly extracted from the audited financial statements and appropriately presented in the Second Supplementary Bidder's Statement.

Deloitte.

3.2 GPT historical financial information

The historical financial information set out in section 3.2 of the Second Supplementary Bidder's Statement has been extracted from the GPT Interim Financial Report for the half year ended 30 June 2004.

The Interim Financial Report of GPT for the half year ended 30 June 2004 was audited by PricewaterhouseCoopers in accordance with Australian Auditing and Assurance Standards. The audit opinion issued to the unitholders of GPT relating to that financial report was unqualified.

The historical financial information is presented in an abbreviated form in so far as it does not include all of the disclosures required by the Australian Accounting Standards applicable to annual financial reports prepared in accordance with the Corporations Act. The Interim Financial Report, as audited at 30 June 2004 is available on the GPT website.

For the purposes of the Second Supplementary Bidder's Statement, Deloitte has undertaken such procedures as it considered necessary in the circumstances for the purpose of ensuring that the information has been correctly extracted from the GPT Interim Financial Report for the half year ended 30 June 2004 and appropriately presented in the Second Supplementary Bidder's Statement.

3.3 Pro forma historical financial information

The pro forma unaudited Statement of Financial Position of Pro Forma Stockland has been based on the aggregation of:

• the Stockland Statement of Financial Position; and
• the significant Stockland transactions announced subsequent to 30 June 2004, including the recent acquisition of Lensworth, as set out in section 3.3 of the Second Supplementary Bidder's Statement.

The pro forma unaudited Statements of Financial Position of the Merged Entity have been based on the aggregation of:

• the pro forma unaudited Statement of Financial Position of Pro Forma Stockland:
• the GPT Statement of Financial Position; and
• the adjustments and assumptions to reflect the impact of the proposed acquisition of GPT as set out in $\bullet$ section 3.3 of the Second Supplementary Bidder's Statement.

The Directors are responsible for the preparation and presentation of the pro-forma historical financial information.

We have reviewed:

• the extraction of the Stockland Statement of Financial Position from the Stockland financial statements for the year ended 30 June 2004;
• the extraction of the GPT Statement of Financial Position from the GPT Interim Financial Report for the half vear ended 30 June 2004:
• the compilation of the pro forma unaudited Statement of Financial Position of Pro Forma Stockland on the basis of the Stockland Statement of Financial Position and the significant Stockland transactions announced subsequent to 30 June 2004, including the recent acquisition of Lensworth, as set out in section 3.3 of the Second Supplementary Bidder's Statement; and
• the compilation of the pro-forma unaudited Statements of Financial Position of the Merged Entity on the basis of the pro forma unaudited Statement of Financial Position of Pro Forma Stockland, the GPT

Statement of Financial Position and the adjustments and assumptions to reflect the impact of the proposed acquisition of GPT as set out in section 3.3 of the Second Supplementary Bidder's Statement.

$\overline{4}$ . Statements

4.1 Historical financial information

Based on our review, which is not an audit, nothing has come to our attention which causes us to believe that the historical financial information, as set out in section 3.2 of the Second Supplementary Bidder's Statement, has not been correctly extracted from the audited financial statements of Stockland for the year ended 30 June 2004 and the audited financial statements of GPT for the period ended 30 June 2004.

4.2 Pro forma historical financial information

Based on our review, which is not an audit, nothing has come to our attention which causes us to believe that the pro forma historical financial information, as set out in section 3.2 of the Second Supplementary Bidder's Statement, has not been accurately compiled on the basis of:

• the Stockland Statement of Financial Position;
• the GPT Statement of Financial Position:
• the significant Stockland transactions announced subsequent to 30 June 2004, including the recent acquisition of Lensworth, as set out in section 3.3 of the Second Supplementary Bidder's Statement; and
• the adjustments and assumptions to reflect the impact of the proposed acquisition of GPT as set out in section 3.3 of the Second Supplementary Bidder's Statement.

5. Independence

Deloitte has no interest in the outcome of the offer for GPT. In connection with the Second Supplementary Bidder's Statement, Deloitte has been engaged to provide a report on the historical financial information and the pro forma historical financial information. In all cases, normal professional fees will be received which are not contingent upon the outcome of the offer for GPT.

Yours faithfully

N.P.Having

Mark Pittorino Director

Tai I horaver

Ian Thatcher Director