GPT GROUP — Capital/Financing Update 2005

Oct 23, 2005

GPT

The GPT Group ASX Announcement & Media Release

GPT ANNOUNCES INCREASE IN JOINT VENTURE PORTFOLIO TO A\$2.38 BILLION 24 October 2005

The GPT Group today announced that the Group's Joint Venture with Babcock & Brown has secured additional acquisitions with a net value of A\$1.2 billion. The acquisitions, which include both European and US assets, will increase the total assets owned by the Joint Venture to A\$2.38 billion and demonstrate the ability of the Joint Venture to identify and acquire assets which meet the entity's investment criteria.

Nic Lyons, GPT's CEO, said that the Joint Venture continued to focus on opportunities in a range of markets and remained confident of being fully invested by the end of 2006, with the Joint Venture invested in a diverse portfolio with a value of A\$2.38 billion following settlement of these acquisitions.

"We are very pleased with the latest acquisitions. Consistent with the original Joint Venture assets, these are quality assets with secure cashflows which will deliver solid returns for GPT's investors," Mr Lyons said.

The transactions include the acquisition of a range of retail assets in Germany and Poland, interests in a portfolio of US retail assets and industrial assets located across Europe, consistent with the return requirements and investment strategy of the Joint Venture.

US RETAIL

• A 90% interest in a portfolio of six retail assets located in the southeast US, is being acquired for A\$440 million from Colonial Property Trust (Colonial). Colonial will retain a 10% interest in the assets and undertake property management. The assets are being acquired on a 2006 forecast yield of 7.9% and represent the Joint Venture's first investment in the US.

EUROPEAN LIGHT INDUSTRIAL

• A portfolio of light industrial assets located in the European markets of the Netherlands, Germany and France. The assets, at a cost of A\$328 million, have been secured on a 2006 forecast yield of 7.4%. The Joint Venture is pursuing a strategy to acquire a large scale portfolio of these assets, partnering with Halverton, a specialist European light industrial operator.

GERMAN RETAIL

German retail assets with a value of A\$460 million, at a 2006 forecast yield of 7.1%. The assets include a range of retail formats, characterised by long leases and strong tenant covenants.

CENTRAL AND EASTERN EUROPEAN RETAIL

An initial investment in Poland, with the acquisition of Galerie Pomorska shopping centre for A\$89 million, on a 2006 forecast yield of 7.3%. This asset, located in Bydgoszcz, is the dominant shopping centre in its market.

GERMAN RESIDENTIAL

The Joint Venture has undertaken its first trading activity, remixing the German residential portfolio with the sale of a portion of the existing portfolio (consisting of portions of the Salzgitter and AMB Generali portfolios) and the realisation of an A\$8 million profit to the Joint Venture from the sale of 5,830 apartments for A\$246 million. Additional residential assets in Berlin and western Germany, at a cost of A\$141 million are being acquired. The remixing has resulted in a more diversified portfolio, with a weighting of no more than 42% to any one geographic area.

Neil Tobin, General Manager, Joint Venture for GPT said that the recent transactions were a good fit with the Joint Venture investment strategy and provided further diversity across the portfolio.

"We have made solid progress over the past four months, the portfolio is beginning to take shape and we have established good acquisitions momentum over a number of portfolios in Europe and the US. This tranche of investments clearly demonstrates the ability of the Joint Venture to deliver on its strategy."

OUTLOOK

The Joint Venture is well on track towards meeting one of its key short-term objectives of being fully invested by December 2006. Further, the original assets acquired on 30 June 2005 are performing in line with expectations. Although only established in June of this year, the Joint Venture has now secured assets with a value of A\$2.38 billion and has made significant progress in aggregating portfolios of significant scale, with retail portfolios in Europe and the US, a portfolio of European light industrial assets and the German residential portfolio forming a solid base for further growth.

In line with the Notice of Meeting and Explanatory Memorandum dated 2 May 2005, the acquisitions are being funded with a mix of equity and non recourse debt.

The European denominated equity is being funded through GPT's existing 600 million Euro facility (currently Euro 300 million drawn). Consistent with the policy to hedge capital exposures through borrowing denominated in the currency in which assets are located, GPT will fund the investment in the Colonial portfolio via US denominated debt.

"We continue to see a strong pipeline of opportunities for the Joint Venture and remain confident of delivering on the investment targets underlying GPT's current distribution forecasts," Mr Lyons said.

NOTE: Acquisition values and yields are after transaction costs and before acquisition fees. Assumed US exchange rate of 0.75:1 and Euro exchange rate of 0.60:1.

Further information on each of the transactions is contained in the attached Presentation.

ENDS

Enquiries

For further information please contact:

Neil Tobin General Manager, JOINT VENTURE Phone: 02 8239 3552

AGENDA

• Retail acquisitions $\frac{\partial f_{\alpha}}{\partial \alpha}$
• US mall portfolio
• German retail
• Central & Eastern European retail $\ldots$
• European light industrial acquisitions $\mathcal{G}_{!!\mathit{B}}$
• Residential portfolio update $\frac{\partial \mathcal{L}}{\partial \mathcal{L}}$
• JV outlook $\mathcal{G}_{!!\mathcal{G}}$

ACOUISITION OVERVIEW

• Net addition of A\$1.2 billion assets Europe & USA - 第
• Interest in US retail portfolio (A\$440m) $\overline{a}$
• Retail acquisitions in Germany and Poland (A\$549m) $\overline{a}$
• European light industrial portfolio (A\$328m) $\cdots$
• German residential net divestment (A\$-95m)
• JV portfolio increased to A\$2.38 billion $\frac{\partial \mathcal{L}_1}{\partial \mathcal{L}_2}$
• Acquisition program in line with expectations
• Acquisitions in line with strategy
• Pipeline remains strong

* Note: Assumed US exchange rate: 0.75:1, Euro exchange rate: 0.60:1

PORTFOLIO TAKING SHAPE

JV FUND PORTFOLIO Portfolio Distribution by Value (AUD)

JV FUND PORTFOLIO Asset Sector by Value (AUD)

US MALL PORTFOLIO

• 90% interest in a portfolio of six malls in the US southeast 编
• Market dominant malls 编
• 10% interest and management by Colonial Property Trust $\mathcal{G}_{!!\mathit{H}}$
• Acquisition Cost: $$A440m*$ 编
• 2006 property yield: $7.9\%*$ 编
• Upside through focussed leasing management, re-positioning Ŵ,
• Platform for further investment in US retail and other sectors $\frac{\partial \mathcal{D}}{\partial \mathcal{D}}$
• Financial close is anticipated in November 2005. $\mathcal{G}_\theta$

* After transaction costs and before acquisition fee. Subject to settlement adjustments. 90% JV interest only. Assumed exchange rate: 0.75:1

ASSETS

Property	Owned Mall GLA (SqFt)	Total GLA (SqFt)	Total Occupancy	Occ Cost	Inline Sales PSF US\$	Anchors
Colonial Mall Bel Air, Mobile, Alabama	998,096	1,332,086	97.3%	10%	\$310	Sears JC Penny Parisian Target Dillards
Colonial Mall Greenville, Greenville, North Carolina	404,266	450,317	94.9%	10%	\$330	Belk JC Penny Steve & Barry's
Colonial Mall Valdosta, Valdosta, Georgía	464,953	538.676	90.5%	9%	\$296	Sears JC Penny Belk
Colonial University Village, Auburn, Alabama	401,620	526,327	85.2%	11%	\$275	Sears Belk JC Penny Dillards
Colonial Mall Glynn Place, Brunswick, Georgia	282,182	507,740	96.5%	10%	\$220	Steve & Barry's Sears Belk JC Penney
Colonial Mall Myrtle Beach, South Carolina	448,917	506.538	91.3%	14%	\$236	JC Penney Bass Pro Belk
Total	3,000,034 3,861,684		93%		\$286

TOP TEN TENANTS

	Tenant	Number of stores	Annual Rent US\$('000)	% of total
	JC Penney		\$1,455	5.7%
2	Limited Brands, Inc.	16	\$1,421	5.5%
3	Sears	5	\$1,245	4.8%
4	Steve & Barry's		\$833	3.2%
5	The GAP		\$824	$3.2\%$
6	Trans World Entertainment (FYE)	9	\$711	2.8%
7	Venator (Footlocker)	6	\$602	2.3%
8	Georgia Theatre Company		\$440	1.7%
9	Shoe Dept.	5	\$435	1.7%
	10 Lane Bryant	5	\$432	1.7%
	Balance	343	\$17,337	67.4%
	Total	405	\$25,735	100.0%

BEL AIR & UNIVERSITY VILLAGE

Colonial Mall Bel Air, Mobile, Alabama

COLONIAL PROPERTY TRUST

• Market cap US\$5.2 billion - 第
• Diversified retail, multi-family, office - 第
• Established in the sunbelt expanding east to west - 第
• Change in retail focus towards development of lifestyle 编 centres
• Alignment 编
• 10% co-investment by Colonial
• Intention to jointly pursue other investment opportunities $\frac{1}{2}$
• Similar corporate values
• Property Management Agreement $\mathcal{G}_2$
• Five year agreement
• Market level fees
• Buy / sell provisions

EUROPEAN LIGHT INDUSTRIAL

• Partnership with Halverton $\mathcal{G}_\mathcal{G}$
• Strategy to aggregate a portfolio of light industrial assets 渤
• Target portfolio circa A\$1.25b $\frac{\partial \rho}{\partial \rho}$
• Initial portfolio: A\$328m* 18
• 2006 property yield: $7.4\%*$ 编
• Stable income from a diversity of assets, locations, tenants $\mathcal{G}_\mathcal{D}$
• Upside at exit through portfolio aggregation $\mathcal{G}_\mathcal{D}$

After transaction costs and before acquisition fee. Assumed exchange rate 0.60:1

HALVERTON

• Specialist asset and property manager of multi-tenanted $\frac{\partial \mathcal{L}_1}{\partial \mathcal{L}_2}$ light industrial assets in Europe
• The three principals have extensive experience in $\mathcal{L}_{\mathcal{D}}$ the sector (acquisitions of $>$ Euro 1 billion since 2000)
• Established operating platform $\mathcal{G}_{\mathcal{G}}$
• Head office London
• Regional offices Amsterdam, Paris, Frankfurt
• Exclusive relationship $\mathcal{L}_{\mathcal{G}}$

INITIAL PORTFOLIO

HALVERTON

PROPERTY	Location	COUNTRY	sqm	# TENANTS
Zoetermeer	The Hague	Netherlands	5,848	7
Almere	East Amsterdam	Netherlands	3,850	16
Arnhem	East Holland	Netherlands	2,620	2
Apeldoorn	Central Holland	Netherlands	3,020	1
Aalten	East Holland	Netherlands	2,450	9
Alkmaar	North Holland	Netherlands	2,498	1
Amstel Gateway	South Amsterdam	Netherlands	3,529	3
Business Centre Rivium	Rotterdam	Netherlands	4,648	15
Haarlem	West Amsterdam	Netherlands	3,273	4
Soesterberg	Utrecht	Netherlands	4,616	1
Star Alpha	Zoetermeer, The Hague	Netherlands	9,011	7
Wilton Trade Park	Zoetermeer, The Hague	Netherlands	6,031	12
Mijdrecht	South Amsterdam	Netherlands	5,610	3
Nieuwegein	Utrecht	Netherlands	5,274	6
Papendrecht	South Rotterdam	Netherlands	14,086	11
Smart	Utrecht	Netherlands	31,072	14
Torendijk	Rotterdam	Netherlands	10,760	36
Zaandam	North Amsterdam	Netherlands	4,896	11
Delta Forum	Frankfurt	Germany	20,204	12
Ikarus Puccheim	Bavaria	Germany	14,686	45
LKS Bremen	Bremen	Germany	152,741	11
Nuess	Dusseldorf	Germany	11,499	11
Garges les Gonesse	Paris	France	8,803	14
Lille	North France	France	20,738	8

351,763

TOTAL

GERMAN RETAIL

• Strategy to aggregate a critical mass portfolio $\frac{\partial \mathcal{D}}{\partial \mathcal{D}}$
• Initial portfolio: $$A460m*$ $\mathcal{G}_\mathcal{G}$
• 2006 property yield: $7.1\%*$ ŵ
• Strong lease covenants $\mathcal{G}_\mathcal{F}$
• Average weighted lease expiry of 10+ years
• Creditworthy tenants
• Upside at exit through securitisation $\mathcal{G}_\mathcal{G}$
• Further transactions established deal network & track record $\mathcal{G}_\mathcal{D}$

*After transaction costs and before acquisition fee. Assumed exchange rate 0.60:1

GERMAN RETAIL INITIAL PORTFOLIO

PROPERTY	LOCATION	sqm	ANCHORS
Bavarian Retail Parks	Bavaria	44,370	Kaufland, Lidl, REWE
Munich Retail	Bavaria	55,000	Kaufhof AG, Bauhaus
Straubing	Bavaria	34,551	Kaufland
Kelheim	Bavaria	18,881	Edeka, hagebaumarkt
Nedderfeld	Hamburg	18,008	Media Markt, Kaufland
Berlin C&C	Berlin	15,500	REWE
TOTAL		186,310

GERMAN RETAIL TOP TEN TENANTS

No.	Company name	sqm	% of Rent
ssenanananananananananana 1	REWE Group	26,194	16%
2	Kaufland	15,812	10%
З	Bauhaus	13,223	10%
4	Media Markt	6,480	4%
5	Fdeka	6,620	4%
6	hagebaumarkt	6,600	3%
7	Arte AG	4,210	つ%
8	Lidl.	3,654	2%
9	KiK	3,820	2%
10	Mueller	3,347	2%

GERMAN RETAIL ASSETS

Nedderfeld, Hamburg

GERMAN RETAIL ASSETS

Straubing, Bavaria

CEE RETAIL

• Acquisition of Galerie Pomorska (Bydgoszcz, Poland)
• Acquisition cost: $$A89m*$ 编
• 2006 property yield: 7.3%* $\mathcal{G}_\beta$
• Market dominant shopping centre $\mathcal{G}_\ell$
• Identified upside $\mathcal{G}_\mathcal{G}$
• Tenant re-mix
• Lower funding costs
• Potentially further CEE retail opportunities $\mathcal{G}_\beta$
• Total existing portfolio: A\$274m
• Transaction track record

*After transaction costs and before acquisition fee. Assumed exchange rate 0.60:1

GALERIE POMORSKA

• Located in Bydgoszcz $\mathcal{G}_\mathcal{G}$
• Population 370,000
• Anchored by Carrefour Hypermarket (not acquired) $\frac{\partial \mathcal{L}}{\partial \mathcal{L}}$
• Total NLA 29,800 sqm $\mathcal{G}_\mathcal{D}$

Carrefour	11,700 sqm
Specialities	18,100 sam

• Occupancy 95% (total NLA) $\frac{\partial \mathcal{D}}{\partial \mathcal{D}}$
• Occupancy cost 11-12% $\mathcal{G}_{\mathcal{G}}$
• Leases $\mathcal{G}_\mathcal{G}$
• Denominated in Euros $\ldots$
• Linked to CPI $\frac{1}{2}$

GERMAN RESIDENTIAL PORTFOLIO

• Completed a significant re-mix of the portfolio $\mathcal{G}_{!!H}$
• Sale of portion of Salzgitter and AMB portfolios (A\$246m) $\ldots$
• Re-investment of close to 60% of sale proceeds (A\$141m*) $\ldots$
• Realisation of A\$8m in profit (after costs) $\cdots$
• Improved portfolio $\mathcal{G}_{!!B}$
• Greater diversity
• Less exposure to tertiary markets $\cdots$
• Average 2006 forecast yield 6.5%
• Pipeline remains strong $\mathcal{G}_{!!\mathcal{G}}$

* After transaction costs and before acquisition fee. Assumed exchange rate 0.60:1

GERMAN RESIDENTIAL PORTFOLIO

PORTFOLIO	LOCATION	# APTS $(1)$	OCCUPANCY (2)	VALUE A\$
Salzgitter	Salzgitter	7,863	$\label{thm:main} We have a new group to the following to the following to the following to the following to the following to the following to the following to the following to the following to the following to the following to the following to the following to$ 84%	\$346.5
AMB / Other	West Germany	2,154	96%	\$182.7
Kiel	Kiel	1,434	87%	\$72.5
Berlin	Berlin	1,199	95% 550530000000000000000000000000000000000	\$221.3
TOTAL		12,650	87%	\$823.0

———————————————————————————————————

(2) Occupany calculation excludes retail/commercial space in Berlin

GERMAN RESIDENTIAL PORTFOLIO

GERMAN RESIDENTIAL Portfolio Geographic Distribution June '05

GERMAN RESIDENTIAL Portfolio Geographic Distribution Nov '05

JV OUTLOOK

• Total assets of A\$2.38 billion $\mathcal{G}_{!!\mathit{H}}$
• On target to fully invest JV capital by Dec 2006 $\mathcal{G}_{!!\mathcal{U}}$
• On target to achieve forecast spreads (net yield over $\mathcal{G}_\mathcal{G}$ debt cost)
• Fund portfolio beginning to take shape $\mathcal{G}_\theta$
• Pipeline remains strong $\mathcal{G}_{!!\mathit{H}}$
• Investigation of proposed Hotel Fund and other $\mathcal{G}_0$ opportunities continuing