VGP NV — Annual Report (ESEF) 2023

Apr 9, 2024

VGP NV ANNUAL REPORT 2023

CONTENT

• Company Report - 004
• Key figures - 007
• Letter to the share– and bond– holders - 009
• Report of the Board of Directors
  • Corporate governance statement — page 27
  • Risk factors — page 29
• Summary of the accounts and comments — page 292
• Information about the share — page 295
• Outlook - 277

Board of Directors and Management

• Board of Directors — page 270
• Executive Management Team — page 278

COMPANY REPORT 2023

CONTENT

• Profile - 013
• Strategy - 019
• VGP in 2023
  • Summary — page 266
  • Business review — page 265
  • General market overview — page 288

106 Corporate Responsibility Report

250 Portfolio

319 Financial Review

VGP Park Nijmegen, The Netherlands
Company report 2023

VGP Park Laxenbug, Austria

COMPANY REPORT 2023

KEY FIGURES

Investment properties

	2023	2022	2021	2020	2019
Own portfolio
Total lettable area (m²)	1,609,300	1,363,900	765,800	205,100	146,100
Occupancy rate (%)	98.8%	98.5%	99.3%	100.0%	100.0%
Fair value of property portfolio	2,000,277	2,514,222	2,200,119	920,151	792,944
Joint Ventures’ portfolio (100%)
Total lettable area (m²)	3,756,200	2,937,100	2,326,100	2,236,300	1,764,600
Occupancy rate (%)	99.0%	99.1%	99.4%	98.4%	99.8%
Fair value of property portfolio ¹	5,193,215	3,928,725	3,545,582	2,922,563	1,978,266

Balance sheet

	2023	2022	2021	2020	2019
Shareholders’ equity	2,214,417	2,202,175	2,175,565	1,305,736	699,781
Gearing
Net debt/total assets	40.3%	34.4%	29.8%	25.2%	37.2%

Income statement

	2023	2022	2021	2020	2019
Gross rental and renewable energy income	69,003	51,230	17,618	12,078	11,653
Property operating expenses	(5,534)	(8,223)	(2,219)	(3,784)	(2,556)
Net rental and renewable energy property income	63,469	43,007	15,399	8,294	9,097
Property and facility management/development income	26,925	21,537	21,303	14,699	10,492
Net valuation gains/(losses) on investment property	87,958	(97,230)	610,261	366,361	188,165
Administrative costs	(48,863)	(33,956)	(52,112)	(29,296)	(18,100)
Share in the results of joint ventures and associates	(10,715)	(45,927)	186,703	63,338	65,703
Other expenses	—	(3,000)	(5,000)	(4,000)	(3,000)
Operating result	118,774	(115,569)	776,554	419,396	252,357
Net financial result	(6,031)	(27,008)	(12,654)	(8,592)	(14,238)
Taxes	(25,451)	20,035	(113,845)	(39,865)	(32,506)
Result for the year	87,292	(122,542)	650,055	370,939	205,613

Result per share

	2023	2022	2021	2020	2019
Net result per share (in €) ² – Basic	3.20	(5.49)	31.41	18.58	6.52
Net result per share (in €) ² – Diluted	3.20	(5.49)	31.41	18.58	6.52

¹ Includes buildings under construction and development land which are/will be developed by VGP on behalf of the First, Second and Fifth Joint Venture.
² Calculated based on the weighted average number of shares amounting to 27,277,506 shares as at 31 December 2022. The total issued shares at year-end 2022 and for the full year 2023 were 27,077,501 shares.

VGP Park Nijmegen, The Netherlands

PAGE 010

LETTER TO THE SHARE– AND BONDHOLDERS

Dear fellow share– and bondholders of VGP,

2023 has been in many ways a remarkable year and before I summarize some of our achievements, I would like to take you back to the first half of 2022. During that time, it became evident that the construction inflation, which had begun already in 2021, would significantly impact the real estate sector. It then culminated further by the measures of the central banks to counter inflation. Real estate, being sensitive to the interest rate environment, did not escape from a strong correction following a period of high liquidity at low cost. It was clear that the sector was up for a significant shake-up, as it turned out to be.

Considering all these factors back then – the prospects of a declining economy, ECB's rate policy, rising input costs, and substantial corrections in the financial markets, including a notable correction in the bond markets – we opted to reduce our speculative developments to nearly zero. Our focus shifted to delivering on excellent asset management performance, safeguarding liquidity and focussing exclusively on land plots and (pre-let) developments with established business cases, aligning with our profit assumptions and disregarding optimis- tic rental growth scenarios.

Institutional investors in the meantime shifted rather towards debt financing and we observed a similar stance from our JV partner Allianz, choosing not to extend beyond the commitments already made before, albeit that nevertheless it turned out to be a record year in transactions with them anyhow. Simultaneously, we anticipated and still anticipate a restructuring of the European industry which brought and potentially will bring many attractive brown field opportunities to the market. This led us to believe that those with a strong balance sheet and adamant liquidity would be able to execute on interesting opportunities. In anticipation, we executed a rights issue of € 200 million to position ourselves for 2023 and the opportunities that we saw ahead.

Twelve months later, I am pleased to say that this strategy has paid off. We have been able to secure the strategic Stellantis land plots in Vélizy, Rüsselsheim, and now recently also Mulhouse. These projects mark a crucial milestone in VGP's portfolio and long-term growth strategy. Besides these, we also made first steps in securing a land plot in Vejle, Denmark, our inaugural land plot with plans for further expansion, and the swift com- mencement of our first, pre-let, construction in France. Addi- tionally, the strong demand in Eastern Europe fuelled by the shift to electric cars and some iconic developments in West- ern Europe have contributed to the growth of our contracted annual rental income (cara) by 17% to well over € 250 million.

PAGE 011

Over the past year a steep decline in construction prices in almost all of the markets we are active in, combined with a healthy demand, has given us the confidence to increase new start-ups of buildings in our development pipeline. Though we remain prudent on our pre-let levels, but if necessary we can be very aggressive as we are competing mostly with buildings which have been developed at a far higher construction cost. Thanks to all this, we foresee a considerable increase in the yield on cost for our newly started projects.

Our portfolio of standing assets is currently 97% let and has only an average age of 2.5 years. Vacancy remains low in Europe and new supply has reduced now significantly, which favours at least a stable outlook on rental price evolution and occupation for our assets. Our standing assets have a healthy wault of 8.2 years and are inflation protected.

Our ESG targets and ambitions are moving all the time upwards as we are dedicated to contribute to our European Green Deal, understanding that we need to think about future generations and our heritage for them and we want to do our part of the effort to decrease our dependency on energy supply from other regions of this world. Hence we have sig- nificantly grown our renewable energy business unit and deliv- ered many Breeam excellent, even one platinum building over the year, our total portfolio is now already for 75.5% certified.

Our JV model has always been tailored around being less dependent on the capital markets, allowing us to recycle our working capital by partly divesting our development projects, once completed, into a long-term Joint Venture with a strong institutional partner. Despite a sluggish investment climate in the sector in ‘22, we have set the pace in the market by exe- cuting new Joint venture transactions totalling over € 2 billion.# COMPANY REPORT 2023 PAGE 013

PROFILE

VGP (www.vgpparks.eu) is a pan-European pure-play logistics real estate group specialised in the acquisition, development, and management of logistic real estate, i.e. buildings suitable for logistical purposes and light industrial activities. The Group focuses on strategically located plots of land in Germany, the Czech Republic, Spain, the Netherlands, Denmark, Slovakia, Hun- gary, Romania, Austria, Italy, Latvia, Portugal, Serbia, France and Croatia, suitable for develop- ment of logistic business parks of a certain size, so as to build up an extensive and well-diversi- fied land bank on top locations. The Group has a track record of successful land acquisitions being converted into fully opera- tional business parks consisting of high-end logistic real estate and ancillary offices. The Group constructs and develops such parks for its own account and for its Joint Ventures, which are subsequently rented out to reputable clients by means of long-term commercial lease contracts. The Group had an in-house team of 325.5 people ⁷ as at 31 December 2023 which manages all the activities of the fully integrated business model: from the identification and acquisition of the land to the conceptualisation and design of the project, the supervision of the construction works, the contacts with potential tenants and the asset- and property management of the real estate portfolio. VGP focuses on top locations in the vicinity of highly concentrated living and/ or production centres, with an optimal access to transport infrastructure. In addition to its real estate activities, VGP has launched a VGP renewable energy business line to provide renewable energy solutions to its tenants or other stakeholders. For more infor- mation, please refer to section Strategy – Renewable Energy. VGP owns a property portfolio of € 1,588.4 million (in full ownership including assets deve- loped on behalf of the Joint Ventures) as at 31 December 2023 which consists of 114 completed buildings with a total lettable area of over 7,301,000 m² (€ 3,150.7 million), 19 buildings under construction representing 888,000 m² of lettable area (€ 1,550.1 million) and remaining deve- lopment land in the amount of € 922.7 million. The Joint Ventures own a property portfolio of € 8,027.3 million as at 31 December 2023 which consists mainly of 370 completed buildings with a total lettable area of over 5,351,000 m². As at 31 December 2023, VGP (own and Joint Ventures’ portfolio) has a remaining secured i.e. owned and committed development land bank of 9.5 million m², having a development poten- tial of circa 6.5 million m² of future lettable area, and which is 90% in full ownership. For further details please refer to section Business review – Land bank evolution.

⁷ On a Full Time Equivalent (FTE) basis.

PAGE 014 VGP NV ANNUAL REPORT 2023

PROFILE

Sustained growth in committed annualised leases …

Evolution of the Group’s committed annualised rent income and number of lease contracts (Including Joint Ventures at 100%) over the past years

of committed annualised leases	€350.8 million	As at 31 December 2023	Number of contracts
Increase in rental income
Rolling rental income
Annualised Rent income – In (million €)	Number of contracts
0	0
50	100
100	200
150	300
200	400
250	500
300	600
350

COMPANY REPORT 2023 PAGE 015

PROFILE

… driving resilient portfolio growth …

The historical evolution of the Group’s completed gross leasable area (including assets divested and sold into the Joint Ventures a 100%) during the past years has been as follows:

of new lettable area developed	5.0 million m²	Since 2017	Projects divested	Projects held directly by VGP	Projects held by Joint Ventures
in '000 m²	7,000	719	446	831	900

PAGE 016 VGP NV ANNUAL REPORT 2023

PROFILE

Resulting in diversified investment portfolio …

Investment Portfolio breakdown by Country (incl JV at 100%) 31 December 2023 (in € mm)

Country	Value	Percentage
Austria	€ 204 mm	3%
Czech Republic	€ 847 mm	12%
Croatia	€ 6 mm	0%
Denmark	€ 2 mm	0%
France	€ 97 mm	1%
Germany	€ 3821 mm	53%
Hungary	€ 263 mm	4%
Italy	€ 139 mm	2%
Latvia	€ 100 mm	1%
The Netherlands	€ 515 mm	7%
Portugal	€ 66 mm	1%
Romania	€ 249 mm	3%
Slovakia	€ 263 mm	4%
Serbia	€ 68 mm	1%
Spain	€ 553 mm	8%

Investment Portfolio breakdown by status (incl JV at 100%) 31 December 2023 (in € mm)

Status	Value	Percentage
Constructed	€ 5,524 mm	77%
Under construction	€ 711 mm	10%
Development Land	€ 959 mm	13%

VGP Park Hochhstadt, Germany
VGP Park Magdeburg, Germany

COMPANY REPORT 2023 PAGE 019

STRATEGY

Strategy

VGP’s goal is to be a leading pan-European logistics real estate group specialised in the acqui- sition, development, and management of logistic real estate, i.e. buildings suitable for logistical purposes and light industrial activities. The Group focuses on (i) strategically located plots of land suitable for development of logis- tic business parks of a certain size, so as to build up an extensive and well-diversified land bank and property portfolio on top locations; (ii) striving to optimise the operational performance of the portfolio and the activities of our tenants through dedicated teams which provide asset- property and development management services; (iii) growing the different strategic partner- ships entered into with Allianz Real Estate, Deka, Areim or with other local partners (see below) and (iv) implementation of its ESG strategy, by amongst others, offering solutions and acting as an enabler to help the Group’s tenants and other stakeholders in their green energy transition through the roll-out of the renewable energy business line. These elements should allow the Group to provide attractive return for our shareholders through progressive dividend and net asset value growth over time.

PAGE 020 VGP NV ANNUAL REPORT 2023

STRATEGY

Development activities and portfolio ancillary services

Development activities

Greenfield and brownfield developments are the core activ- ity of the VGP Group. Brownfield developments are gradu- ally becoming more important as greenfield developments in some targeted prime locations become increasingly scarce. Developments are undertaken primarily for the Group’s own account and to a lesser extent for the Joint Ventures. The Group pursues a growth strategy in terms of develop- ment of a strategic land bank which is suitable for the develop- ment of turnkey and ready-to-be-let logistic projects. The plots are zoned mainly for logistic or semi-industrial activities. The management of VGP is convinced that the top location of the land and the high-quality standards of its real estate projects contribute to the long-term value of its portfolio. The Group concentrates on the sector of logistics and light industrial accommodation projects situated across Continen- tal Europe. The Group operates in 27 European countries, 25 of which the Group already carries out development activities or holds a development pipeline for future development activities. High quality projects are always developed on the basis of VGP building standards, with adaptations to meet specific requirements of future tenants but always ensuring multi- ple purpose use and easy future re-leasability. In their initial phase of development, some projects are being developed at the Group’s own risk (i.e., without being pre-let). The constructions, which respond to the latest modern qual- ity standards, are leased under long-term lease agreements to tenants which are active in the logistic, semi-industrial or e-commerce sector, including storing but also assembling, reconditioning, final treatment of the goods before they go to industrial clients or retailers. The land positions are located in the vicinity of highly concentrated living and/ or production centres, with an optimal access to transport infrastructure.

Portfolio ancillary services

The Group provides property management, asset manage- ment and facility management services to its portfolio and the Joint Ventures (see below). Property management services are exclusively provided to the Group’s own portfolio and the Joint Ventures whereby the respective Group property management company is responsi- ble for managing the proper and undisturbed operation of the buildings.# COMPANY REPORT 2023 PAGE 021 STRATEGY

As part of its offered services the VGP property management companies also provide project management services and leasing services. The asset management services entail giving advice and recommendations to the Joint Ventures on the Joint Ventures’ asset management and strategy, thereby optimising the value of the Joint Ventures’ assets. As part of the provided services, VGP is responsible for standard corporate administration, financing, business planning, reporting, budgeting, management of tax and legal affairs, controlling, etc. Facility management services are carried out in the local countries by specific dedicated teams which are focused on managing the proper and undisturbed operation of the buildings and performing or manage all actions such as maintenance services, waste management services, maintenance greenery that may be necessary in this respect. Other services include providing green energy generated through roof-fixed solar panels, smart energy management and green electric charging facilities and infrastructure. (see below)

Renewable Energy

VGP Renewable Energy offers a broad array of renewable energy solutions for warehouses, including solar, wind and thermal, as well as integrators for storage and distribution. We offer green energy to our tenants, produced on site or off site, with our own photovoltaic systems. This is provided via lease or Power Purchase Agreements. We aim to offer our clients a tailormade green energy solution, which is typically offered with photovoltaic systems at our VGP Parks, yet also with the ability to offer green energy which is sourced elsewhere, with green power generation assets near our parks. We are actively exploring these ways of sourcing local tailored opportunities, adapted to local tenant energy needs. Since January 2021 our energy business in Germany is a registered utility and we will imminently expand this activity into Romania. These endeavors allow us to harness the full potential of our existing photovoltaic projects to distribute clean energy more efficiently to our tenants and beyond. Our commitment to renewable energy has propelled us to surpass a significant milestone – 277 MWp in operational solar capacity. With an ambitious pipeline of projects, we will be able to exceed the energy needs of our tenants. Next to photovoltaic systems, we also aim to offer other current technologies of renewable energy production and storage relevant to the clients of VGP, such as wind turbines or geothermal heating. Next to this, we provide green e-mobility charge facilities for electric trucks and cars, and we are currently exploring qualitative methods for energy storage with battery installation and load management. Furthermore, we support our tenants to identify green energy usage optimization and flexible energy consumption with energy control methods for divers processes to optimize the photovoltaic consumption potential, amongst others.

Key principles of VGP’s investment strategy

1. Strategically located plots of land
2. Focus on business parks with a view to realising economies of scale
3. High quality standardised and sustainable logistic real estate
4. In-house competences enabling a fully integrated business model
5. Primary focus on long term fundamentals

DEVELOPMENT PAGE 022 VGP NV ANNUAL REPORT 2023

STRATEGY

Fully integrated model with in-house capabilities and competences

Land

Identification of top locations directly connectable to existing infrastructure
Evaluate potential projects, technical due diligence
Obtain the zoning and building permit

Concept and design

In-house design of buildings based on strict guidelines for multi-purpose utilisation
Strategic alliance with architecture firms, in close cooperation with local authorities
Some adaptation according to tenants‘ requirements but within VGPs own standard building parameters

Construction

High quality logistics projects constructed by external contractors in close cooperation with future tenants
Acting as a general contractor on a significant part of the construction pipeline
High technical and quality standards

ASSET MANAGEMENT RENEWABLE COMPANY REPORT 2023 PAGE 023 STRATEGY

Rent

Mainly long term lease agreements
Officers responsible for monitoring of the tenants’ requirements until the handover of the premises
Working together with local real estate brokers

Portfolio

Long term developer/ investor (own portfolio or sale to one of the JVs)
Portfolio management
Asset management
Property management
Centralised maintenance of properties

Ancillary services

Assisting clients with transitioning towards sustainable energy usage in a cost-effective way
Offering includes: green energy (produced on or off-site), smart energy management, green electric and hydrogen charging facilities and infrastructure

PAGE 024 VGP NV ANNUAL REPORT 2023 STRATEGY

In order to sustain its growth over the medium term, VGP entered into several 15:15 joint ventures with well-known institutional investors. These joint venture structures allow VGP to partially recycle its initial invested capital when completed projects are acquired by the respective joint ventures and allow VGP to re-invest the sales proceeds in the continued expansion of the development pipeline, including the further expansion of the land bank, thus allowing VGP to concentrate on its core development activities.

Partnership with Allianz

First Joint Venture — Rheingold

The First Joint Venture was established in May 2015 with an objective to build a platform of new, grade A logistics and industrial properties with a key focus on expansion in core German markets and high growth CEE markets (of Hungary, the Czech Republic and the Slovak Republic) with the aim of delivering stable income-driven returns with potential for capital appreciation. The First Joint Venture aimed to increase its portfolio size (i.e. the gross asset value of the acquired income generating assets) to circa €2.5 billion by May 2021 at the latest, via the contribution to the First Joint Venture of new logistics developments carried out by VGP. The First Joint Venture’s strategy is therefore now primarily a hold strategy.

Following the reaching of the expanded investment target in 2021, both VGP and Allianz agreed during the month of December 2022 to amend the JVA resulting in the following main changes:
(i) extension of the current term of the First Joint Venture with 10 years i.e. from May 2041 to May 2051
(ii) implementation of a comprehensive ESG strategy, and
(iii) agreeing to an additional tenth closing in respect of 59 newly completed buildings in 7 (partly) new VGP parks.

On 25th of January 2023, VGP concluded a tenth transaction with the First Joint Venture. The transaction comprised 9 logistic buildings, which are located in Germany (one) and in the Czech Republic (two). The gross asset value of the completed assets amounted to €100.73 million and the net proceeds from this transaction amounted to €35.41 million.

As at 31st December 2023, the First Joint Venture’s property portfolio consists of 108 completed buildings representing a total lettable area of over 1,530,000 m². Although the First Joint Venture reached its expanded investment target, some add-on closings related to existing tenant extension options may still occur in the future. The First Joint Venture will maintain its existing portfolio with VGP, continuing to act as property, facility and asset manager.

Second Joint Venture — Aurora

The Second Joint Venture was established in July 2017 with the objective to build a platform of core, prime logistic assets in Austria, Italy, the Netherlands, Portugal, Romania and Spain with the aim of delivering stable income-driven returns with potential for capital appreciation. The Second Joint Venture aims to increase its portfolio size to circa €2.5 billion by July 2023 at the latest, via the contribution to the Second Joint Venture of new or recently built logistics developments carried out by VGP. The Second Joint Venture’s strategy is therefore primarily a hold strategy. The Second Joint Venture has the exclusive right of first refusal in relation to acquiring the income generating assets located in Austria, Italy, the Netherlands, Portugal, Romania, and Spain.

During 2023, VGP completed a fourth and currently last closing whereby, the Second Joint Venture (“VGP European Logistics 1 S.à r.l.”) acquired, on 30 June 2023, 11 logistic buildings, including 5 buildings in 3 new VGP parks and another 6 newly completed buildings (in parks which were previously transferred to the Second Joint Venture), for an aggregate transaction value 1 in excess of €156 million and resulting into net aggregate cash proceeds of €108.17 million.

As at 31st December 2023, the Second Joint Venture’s property portfolio consists of 86 completed buildings representing a total lettable area of over 970,000 m². The development pipeline and future development of other new projects within its geographical scope will continue to be developed at VGP’s own risk to be subsequently acquired by the Second Joint Venture if the right of first refusal is exercised subject to pre-agreed completion and lease parameters. The acquisition of any building by the Second Joint Venture will always occur on the basis of the prevailing market rates at the moment of such acquisition. VGP carries 100% of the development risk of the Second Joint Venture.

Third Joint Venture — Ymir

The Third Joint Venture was established in June 2020 with an objective to develop VGP Park München. Once fully developed, VGP Park München will consist of five logistic buildings, two stand-alone parking houses and one office building for a total gross lettable area of approx. 108,000 m². The park is entirely pre-let. Since its establishment, three closings with the Third Joint Venture have occurred.# COMPANY REPORT 2023 PAGE 025

STRATEGY

The financing of the development capex of the Third Joint Venture occurs through shareholder loans and/or capital contributions by the shareholders in proportion to their respective shareholding. Upon completion of the respective building(s), a closing with the Third Joint Venture occurred which allowed the Group to receive the proportional share price allocated to the building(s) from Allianz and to partially/totally recycle its initially invested capital in respect of the building(s) included in such closing through the refinancing of such invested capital by external bank debt. The tenant KraussMaffei has been gradually relocating its head offices, during the first half of 2022, to the new business park. This relocation is marked as the largest relocation project in Greater Munich since the relocation of Munich Airport in 1992. The move by KraussMaffei follows the announcement by BMW of the opening of a Battery Competence Centre in the same park in May 2022. Together, KraussMaffei – with 120,000 m² gross lettable area – and BMW – with 50,000 m² gross lettable area – occupy the existing park. The last remaining building, which is to be completed by 2023 will provide 25,000 m² gross lettable area and is an extension option for KraussMaffei. Once fully developed, VGP Park München will consist of five logistics buildings, two stand-alone parking houses and one office building for a total gross lettable area of ca. 370,000 m². VGP received an outstanding cash consideration in an amount of €37.13 million from Allianz in Q4 ’21, with a remaining consideration of €8.10 million (in respect of the office building) to be received, subject to the fulfilment of some closing conditions. These have been fulfilled and the remaining amount of €8.10 million has been received in July ’23. Finally, VGP Park Munich drew its available credit facility of €35.50 million. Following the refinancing, the entity initiated a distribution of excess cash available to their shareholders, amounting to €95 million. Out of this amount, €85 million was allocated to VGP in July ’23. The entity expects to draw another €75.50 million on an available credit facility within the first half of 2024.

Fourth Joint Venture — Europa

As the First Joint Venture reached its investment capacity, Allianz and VGP entered into a new joint venture agreement in December 2017 with a view to establish a new Fourth Joint Venture. This Joint Venture’s objective was to build a platform of new, grade A logistics and industrial properties with a key focus on expansion within the same geographical scope as the First Joint Venture, i.e. core German markets and high growth CEE markets (of Hungary, the Czech Republic and the Slovak Republic), with the aim of delivering stable income-driven returns with potential for capital appreciation. The Fourth Joint Venture targeted the implementation of a comprehensive ESG strategy on a best-efforts basis. Criteria have been defined around the Carbon Risk Real Estate Monitor (“CCREM”) Assessment Tool, the EU Sustainable Finance Taxonomy, achieving most efficient EPC or similar rating, sustainable certification of buildings, photovoltaic systems, green lease and ESG portfolio data and reporting. The Fourth Joint Venture aimed to increase its portfolio size (i.e. the gross asset value of the acquired income generating assets) to ca. €1.5 billion by 2027 at the latest, via the contribution to the Fourth Joint Venture of new logistics developments carried out by VGP and it had the exclusive right of first refusal (in accordance with the conditions of the Fourth JVA) in relation to acquiring the income generating assets located in Germany, the Czech Republic, the Slovak Republic and Hungary. The Fourth Joint Venture was due to become effective at the moment of its first closing, which was initially expected to occur in November 2021. However, in view of the limited transparency on pricing of the seed portfolio in the current volatile market environment, Allianz decided not to proceed with the first initial pipeline portfolio closing of the Fourth Joint Venture. To this end Allianz formally waived the exclusivity obligation in respect of the initial pipeline portfolio allowing VGP to sell the initial pipeline portfolio to one or multiple third parties, including through the establishment of a new alternative joint venture(s). As no further transactions were envisaged on the short to midterm with the Fourth Joint Venture, the Joint Venture has been terminated and replaced by two new joint ventures (see sections “Partnership with Deka” and “Partnership with Areim”).

VGP Park Munich, Germany

PAGE 026 VGP NV ANNUAL REPORT 2023

STRATEGY

Partnership with Deka

Fifth Joint Venture — RED

VGP has signed 17 July 2023 a new joint venture agreement with Deka Immobilien, a prominent real estate investment company. The joint venture endeavoured that two of Deka Immobilien’s public funds, Deka Westinvest InterSelect and Deka Immobilien Europa, acquire a 50% stake in five project companies owned by VGP. The project companies own and operate five strategically located parks in Germany, namely Gießen – Am alten Flughafen, Laatzen, Göttingen 1, Magdeburg and Berlin Oberkrämer. These parks boast a portfolio of 10 buildings, generating a total annualized rental income of €15.9 million at the time of the transaction. The agreed gross asset value of all assets stands at over €0.90 billion. The transaction was foreseen to be executed in three closings, with the first closing effectuated in Q3 2023. Pricing has been agreed for the full portfolio, thus including the remaining two closings which are set to materialize in H2 and H1 of ’24. To facilitate the joint venture, parties have agreed to refinance the joint venture with an approximative LTV of 50%. Consequently, VGP is set to recycle over €300 million of cash from all closings. The first closing, encompassing 7 of the 10 buildings, generated €756 million in net proceeds (€820 million gross). The remaining closings are set for H2 (two buildings) and Q4 2023 (one building), once the construction of the respective assets are completed. These closings expect to generate minimum €150 million of gross cash proceeds. This joint venture has been established with a long-term horizon. VGP retains asset management services in a similar scope to its existing partnerships with Allianz Real Estate. In conclusion, the partnership between VGP and Deka Immobilien marks a significant milestone in the European real estate market. Through this joint venture, both companies are well-positioned to capitalize on the strong performance of the German property sector, fostering growth and maximizing returns for their stakeholders over the long term and recycling cash for VGP in the short term.

Partnership with Areim

Sixth Joint Venture — SAGA

As per 15 December 2023 VGP entered into a new Joint Venture agreement with AREIM Pan-European Logistics Fund (D) AB, or Areim, on a 50:50 basis, with the purpose of investing into VGP developed assets in Germany, Czech Republic, France, Slovakia and Hungary. The venture will utilize debt up to a loan-to-value of 55%. The investor, Areim, has committed a €100 million equity investment. The investment period lasts until 15 December 2027, with possibilities to extend the Joint Venture by mutual agreement. A seed portfolio has been defined and is set to transition in H2 2024, comprising of developed properties in Germany, Czech Republic and Slovakia for a total gross asset value of more than €200 million, resulting in expected gross cash proceeds of more than €125 million. In many ways the Joint Venture is similar to the Allianz Joint Ventures, being that the Sixth Joint Venture has a right of first refusal, but limited to all buildings of a specific development pipeline within the target countries over the investment period. The joint venture targets a comprehensive ESG strategy, with criteria defined around EU taxonomy compliance, EPC, BREEAM standards, and more. As is the case with similar Joint Ventures, VGP will act as the asset, property and development manager of the Joint Venture. Along with the Fifth Joint Venture, VGP has as such replaced the investment commitment of the terminated Fourth Joint Venture with Allianz.

VGP Park Bratislava, Slovakia

PAGE 027 STRATEGY

Development Joint Ventures

To allow VGP to acquire land plots on prime locations for future development, the Group has entered into three strategic partnerships, i.e. (i) a 50:50 joint venture with Roozen (the LPM Joint Venture), (ii) a 50:50 joint venture with VUSA (the VGP Park Belartza Joint Venture), and (iii) a 50:50 joint venture with Revikon (the VGP Park Siegen Joint Venture) (together, the Development Joint Ventures). The Group considers these Development Joint Ventures as an add-on source of land sourcing for land plots which would otherwise not be accessible to the Group. Similar to the Third Joint Venture, the Development Joint Ventures allow the Group to partially recycle its initial invested capital when buildings are completed by the Development Joint Ventures through refinancing of the invested capital by external bank debt and allows the Group to re-invest these monies in the continued expansion of the development pipeline, including the further expansion of the land bank, thus allowing VGP to concentrate on its core development activities. Currently, the development of the buildings within the Development Joint Ventures has not yet started.# LPM Joint Venture

The LPM Joint Venture was established in November 2017 with an objective to develop Logistics Park Moerdijk (Netherlands) together with the Port Authority Moerdijk on a 50:50 basis. Logistics Park Moerdijk is situated in between the Port of Rotterdam (the Netherlands) and the Port of Antwerp (Belgium) and is one of the few locations in the Netherlands where large-scale value-added logistics and value-added services distribution centres can be developed and built. During 2023, the preparatory works, pre-loading of the land and necessary legal steps in ownership to initiate the first developments have been on-going. In February 2024, VGP agreed on selling the project in its current status and recycled gross proceeds of ca € 70 million.

VGP Park Belartza Joint Venture

The VGP Park Belartza Joint Venture is set up as a 50:50 joint venture with VUSA. The objective of this joint venture is to provide an additional source of land to the Group for land plots which would otherwise not be accessible to it. The VGP Park Belartza Joint Venture aims to develop ca. 50,000 m² of logistics lettable area. The project is currently proceeding well with obtaining the necessary zoning permits. The VGP Park Belartza Joint Venture focuses on the development of a mixed (logistics/commercial) park whereby VGP will lead the logistic development and VUSA will lead the commercial development. The VGP Park Belartza Joint Venture has the right to sell and VGP the right to acquire the logistics income generating assets developed by VGP Park Belartza Joint Venture. VUSA has the right to acquire the commercial income generating assets developed by VGP Park Belartza Joint Venture.

VGP Park Siegen Joint Venture

The VGP Park Siegen Joint Venture is set up as a 50:50 joint venture with Revikon. The objective of this joint venture is to provide an additional source of land to the Group for land plots which would otherwise not be accessible to it. The VGP Park Siegen Joint Venture aims to develop ca. 25,000 m² of lettable space. The VGP Park Siegen Joint Venture focuses on the development of a land plot located in Siegen, Germany. The VGP Park Siegen Joint Venture has the right to sell and VGP the right to acquire the income generating assets developed by VGP Park Siegen Joint Venture. During 2023, following the successful partial sale of its project last year, an equity distribution of € 8.5 million has been paid to VGP NV. The brownfield has been undergoing further demolishment works in 2023, which will continue in 2024.

PAGE 028
VGP NV ANNUAL REPORT 2023

STRATEGY

Faced with the urgency of climate change, VGP is a committed partner to both the transformation of business to the efficiency of Industry 4.0, as well as the regeneration of brownfield industrial estates by accelerating their urban environmental transformation. Sustainability is at the very heart of VGP’s business strategy. In 2022, the Group launched its updated ESG Strategy which combines both an ambitious objective to reduce VGP’s environmental footprint, increase community engagement, and integrating sustainability into the Group’s entire value chain. The Group’s ambitions are aligned with the objectives of the 2015 Paris Agreement and adapted to the challenges and opportunities of the industry and specific nature of its operations. The Group relies on both the quality of its assets and collective power of its employees and stakeholders to raise awareness, mobilise and provide practical solutions that will facilitate the transition towards a low-carbon economy. The Group is actively involved in the communities in which it operates. The Group’s commitment to address climate change across its value chain goes beyond its own direct operations (Scope 1 & 2) and tenant operations (Scope 3) to be reduced in half but also includes a commitment to address the carbon footprint in the entire supply chain through effective ESG management and transparency in carbon pricing. The Group ESG Strategy also tackles challenges like biodiversity, environmentally friendly transport and the circular economy.

The ESG Strategy is based on 5 pillars:

• Sustainable Properties. Through the Group’s Environmental Management System we aim to reduce the environmental impact of our assets at every stage of their life cycle, from their initial design to daily operation as well as future fungibility. Reference is made to Corporate Responsibility Report – paragraph 3.1 Sustainable properties
• Strengthen communities. Input from and consultation with local stakeholders shapes the design, purpose and tenant occupational mix of VGP Parks. The Group is committed to meeting the distinct interests of each municipality and creating mutually beneficial outcomes including local connectivity, a compelling business mix and direct employment for local residents, and long-term project success. Reference is made to Corporate Responsibility Report – paragraph 3.2 VGP in the community
• Empowering our workforce. The Group is committed to offering employees a working environment that fosters diversity and equal opportunities to offer to each employee the experience needed to build an exciting career that creates value for the Group. Reference is made to Corporate Responsibility Report – paragraph 3.3 Empowering our workforce
• Protect and improve biodiversity. VGP actively protects and improves the biodiversity value of its assets by assessing biodiversity impacts and mitigation measures in accordance with BREEAM Excellent/DGNB Gold level standards, and, in addition, by implementing biodiversity action plans based on the Group’s own Biodiversity Strategy that accounts for unique local conditions. Reference is made to Corporate Responsibility Report – paragraph 3.4 Protect and improve biodiversity
• Improve eco-efficiency. The eco-efficiency of our portfolio is improved through daily optimization of operations, by making use of technical improvement of the equipment, including installing LED lighting at refurbishment, offering renewable energy solutions to our tenants, including tailor-made roof-fitted photovoltaic installations for self-consumption and off-site green energy contracts offered through our own energy trading activities leveraging photovoltaic installations elsewhere in the group and improving the intrinsic quality of our new developments, including the installation of heat pumps instead of gas-powered heating where feasible. Reference is made to Corporate Responsibility Report – paragraph 3.5 Improve eco-efficiency

Sustainability

COMPANY REPORT 2023
PAGE 029

STRATEGY

Since January 2024 our energy business in Germany is a registered utility and we will imminently expand this activity into Romania. These endeavors allow us to harness the full potential of our existing photovoltaic projects to distribute clean energy more efficiently to our tenants and beyond. Our commitment to renewable energy has propelled us to surpass a significant milestone – 300 MWp in operational solar capacity. With an ambitious pipeline of projects, we will be able to exceed the energy needs of our tenants. In September 2023 we have established the VGP Academy – a platform designed to empower our employees with the knowledge and skills needed to drive innovation and sustainability within our organization.

VGP’s strategy has been recognized and rewarded:

The DGNB Platinum certification for our project in VGP Park Laatzen underscores our dedication to constructing environmentally friendly and resilient structure as the first as such warranted to a developer owned semi-industrial facility. As a Group, we are garnering the second-highest score for European developer ranking according to GRESB. In addition, the Group’s climate targets have been recognised by the Science Based Targets initiative, as they are aligned with the 1.5 °C trajectory.

VGP Park Hrádek na Nisou, Czech Republic

VGP in 2023

VGP in 2023

VGP Park Prostějov, Czech Republic

PAGE 032
VGP NV ANNUAL REPORT 2023

VGP IN 2023

Summary

• A net profit of € 275.6 million, an increase of € 109.7 million versus FY ’22.
• Executed three joint venture closings resulting in a strong net cash recycling of € 399.1 million.
• All transactions, including those that are committed to close in ’24 have been realized or agreed at a premium versus the recognized fair value at year-end ’22, resulting in a realized gain of € 47 million in ’23 on the effectuated transactions.
• Established two new joint ventures with Deka and Areim for a total gross asset value of over € 1.3 billion.
• Together with two closings with Allianz in H2 ’23, VGP has transacted and/or secured a future pipeline of transactions of € 5 billion gross asset value.
• Upcoming closings in ’24 expect to recycle minimum € 175 million of gross proceeds at pre-agreed pricing.
• € 379.5 million of new and renewed leases signed year-to-date bringing the annualized committed leases at year-end to € 540.7 million (+€ 88.7 million compared to 31 December 2022, which is +19.5% y-o-y).
• 1,946,000 m² of new development land acquired and 1,518,000 m² of development land deployed to support the developments started up during the year.
• Total secured land bank stands at 7.8 million m² at the end of 2023 representing a development potential of over 8.6 million m².
• Pro forma announced sale of LPM in ’24, the total secured land bank lowers to 6.3 million m².
• Total acquisitions represent a capex of € 177.8 million and include the purchase of some iconic land plots in the vicinity of Paris and Frankfurt.
• 28 projects delivered during the year representing 383,000 m², or € 18.6 million in additional annual rent (of which 11 projects totalling 260,000 m² delivered during the 1H 2023), currently 100% let.# VGP NV ANNUAL REPORT 2023

COMPANY REPORT 2023 PAGE 033

SUMMARY

As a result, net rental income, on a look-through basis, grew 25%, from €271.8 million to €339.7 million, knowing that at year-end €714 million (€+119 million y.o.y), or €745.6 million on a proportional look-through basis, has become cash generative.

23 projects under construction representing 778,000 m² (of which 6 projects totalling 300,000 m² started up during the year) and €145.4 million in additional annual rent once fully built and let. The pipeline under construction is 85.6% pre-let. Pre-let ratio lowered as a result of certain speculative assets that initiated construction in Q3 ’23 following amongst others a decline in construction costs.

Property portfolio virtually fully let with occupancy at 98% (compared to 97% as at 31 December 2022). 94.5% of the portfolio is certified, amongst other a DGNB Platinum has been awarded for VGP Park Laatzen, the first German property developed and owned by a developer.

Photovoltaic (PV) capacity grew 75.7% YoY with operational capacity passing the 300 MWp-mark at 303.5 MWp (vs. 172.2 MWp in Dec-22). 31.0 MWp PV projects under development and a further 55.8 MWp being planned. The ongoing transition to green energy consumption in our buildings, as well as other eco-efficiency measures contributed to the four-star GRESB developer rating, the second highest among peers in the European logistics segment.

Solid balance sheet with €300 million undrawn credit facility availability and lower debts of €535 million following repayment of two bonds in April and September. Finally, VGP was able to obtain a credit facility of the European Investment Bank of €150 million to support its renewable energy business unit. As per 15 February 2024, VGP has drawn €46 million of the facility at an interest rate of 4.38% on a ten-year period.

Certain important events occurred after the balance sheet date. It concerns the sale of VGP’s stake in the LPM Joint Venture in Q4 ’23, whereby VGP recycled approximately €130 million of gross proceeds. VGP also acquired its First Danish land plot located in Vejle.

The board of directors proposes an ordinary dividend of €70.5 million (+5.6% versus last year), as well as an extraordinary €10.5 million top-up following the record net cash recycling with the existing and new Joint Ventures in ’23. This brings the total annual gross dividend to €101 million, or €3.30 per share.

VGP Park Arad, Romania

COMPANY REPORT 2023 PAGE 035

BUSINESS REVIEW

Rental activity

As at 31 December 2023, the signed and renewed rental income amounted to €345.4 million¹, bringing the total committed annualized rental income to €640.7 million² (equivalent to 9.0 million m² of lettable area), a 14% increase since December 2022.

On a proportional look-through basis, the total committed annualized rental income amounts to €180 million, an increase of €17.5 million, or 10% since 31 December 2022.

The increase was driven by 591,000 m² of new lease agreements signed, corresponding to €88.8 million of new annualized rental income³, whilst during the same period for a total of 155,000 m² of lease agreements were renewed and extended, corresponding to €38.1 million of annualized rental income (of which €35.0 million related to the joint ventures⁴).

Indexation accounted for €30.2 million in 2023 (of which €7.0 million related to the joint ventures⁴). Terminations represented a total of €7.1 million or 111,000 m², of which €8.1 million within the joint ventures’ portfolio.

From a geographic perspective, Eastern Europe, mainly driven by Romania, Slovakia, the Czech Republic and Hungary, accounted for 46% of the incremental new lease agreements. Within segments, light industrial remained the biggest driver and accounted for 57%⁵ (€15.6 million, of which €10.0 million in the own portfolio) of all new lease agreements.

¹ Of which €10.7 million in JV’s and €334.7 million in the own portfolio
² Including Joint Ventures at 100%
³ Of which 295,000 m² (€80.7 million) related to the own portfolio
⁴ “Joint ventures” refers to VGP European Logistics, VGP European Logistics 1 and VGP Park München, all three 50:50 joint ventures with Allianz Real Estate and the Fifth Joint Venture with Deka
⁵ Based on square meters

Segmentation of new lease agreements FY23 (based on annualized rent)

• E-commerce – 1%
• Light industrial – 57%
• Logistics – 40%
• Other – 2%

Ownership of new lease agreements FY23 (based on annualized rent)

• Joint Ventures – 10%
• Own portfolio – 90%

	Committed annualized rental income 12/22	New Leases	Indexation	Terminations	Committed annualized rental income 12/23
Committed annualized rental income	303.2	44.4	10.3	-7.2	350.8

VGP NV ANNUAL REPORT 2023

The weighted average term⁷ of the leases stands at 5.7 years for the full portfolio, 5.0 years in the own portfolio and 6.0 years in the Joint Venture portfolio. Over 2023, VGP has successfully renewed €38.2 million¹ of annualized rental income.

At year-end 2023, €702.6 million, or 98% of the annualized rental income has become cash generative as the leased space has been handed over to the respective tenants. Over the next twelve months another €73.6 million will become effective as summarized in the table below.

in €mln

	Annualized rental income effective before 31. 12. 2023	Annualized rental income to start within 1 year	Annualized rental income to start between 1–5 years	Annualized rental income to start between 5–10 years
Joint Ventures	223.4	1.7	—	—
Own	80.8	39.6	4.1	1
Total	304.3	41.3	4.1	1

The top ten customers of VGP, including those of the Joint Ventures, represent €171.7 million of annualized rental income, or 27% of the total annualized rental income. They consist of a mix of our three segments, but the largest are represented by the light industrial and e-commerce category. The weighted average lease term of the top ten customers stands at 10.18 years. Opel and Siemens are tenants currently occupying a brownfield site, which will, in time, be reconverted into a newly state of art industrial park.

⁷ Until final maturity. The weighted average term of the leases until first break stands at 5.4 years for the full portfolio, 5.1 years for own and 5.6 years for Joint Ventures portfolio
¹ €35.0 million on behalf of Joint Ventures

Top 10 Ownership

Top ten customers represent 27% of total portfolio and have a combined WAULT of 10.18 years

Top 10 Segmentation

• E-commerce – 31%
• Light industrial – 43%
• Logistics – 21%
• Other – 5%

Top 10 Geography

• Austria – 2%
• Czech Republic – 7%
• Spain – 2%
• Germany – 82%
• The Netherlands – 4%
• Serbia – 3%

COMPANY REPORT 2023 PAGE 037

BUSINESS REVIEW

Construction activity

A total of 23 projects, located in 14 different VGP parks, are under construction which will create 778,000 m² of future lettable area, representing €145.4 million of annualized leases once built and fully let – the portfolio under construction is 85.6% pre-let as of the 31st of December 2023.

This is lower than previous reporting periods but is affected by a number of developments initiated in the second half of 2023 whom are at year-end 49% pre-let, the assets that have been under construction longer than 12 months (for a total of 270,000 m²) have a pre-let ratio of 86.6%. The group, after a period of low speculative development, felt comfortable to increase such developments on the back of decreasing construction costs allowing for attractive yield on cost returns. All projects are earmarked for at least “BREEAM Very Good” or “DGNB Gold”.

Projects under construction

Own portfolio

VGP Park	m²
VGP Park Ehrenfeld	33,000
VGP Park Laxenburg	49,500
VGP Park Rouen 1	39,000
VGP Park Koblenz	32,000
VGP Park Wiesloch-Walldorf	55,000
VGP Park Budapest Aerozone	30,000
VGP Park Gyor Beta	38,000
VGP Park Kecskemét	38,000
VGP Park Valsamoggia 2 (Lunga)	19,000
VGP Park Montijo	32,000
VGP Park Brașov	53,000
VGP Park Timisoara 3	33,000
VGP Park Belgrade– Dobanovci	77,000
VGP Park Bratislava*	40,000
VGP Park Zvolen	8,000
VGP Park Córdoba	7,000
VGP Park Prostějov*	10,000
VGP Park Ústí nad Labem City	29,500
Total own portfolio	623,000

*Destined for the Sixth Joint Venture (Saga) and reported as held for sale as per 31 December ’23

On behalf of JV

VGP Park	m²
VGP Park Olomouc 3	9,000
VGP Park Gießen Am alten Flughafen	68,000
VGP Park Magdeburg	74,000
Total JV	151,000

Total under construction | 774,000 |

During 2023 a total of 18 projects, in 15 different VGP Parks, were completed delivering 383,000 m² of lettable area, representing €81.2 million of annualized committed leases, 100% let. Within the own portfolio it concerns 15 buildings for a total surface of 244,000 m², fully let (of which 8 buildings or 125,000 m² are destined for the Saga Joint Venture and reported as held for sale) and 3 buildings on behalf of the Joint Ventures totalling 139,000 m² and which are also fully let.# VGP NV ANNUAL REPORT 2023

VGP IN 2023

Projects delivered during FY2023

Own portfolio

VGP Park	m²
Austria VGP Park Graz 2	14,000
Czech Republic VGP Park České Budějovice	14,000
Czech Republic VGP Park Ústí nad Labem City	23,000
Germany VGP Park Hochheim	12,000
Hungary VGP Park Budapest Aerozone	14,000
Hungary VGP Park Kecskemét	20,000
Latvia VGP Park Tiraines	29,000
Portugal VGP Park Loures	20,000
Romania VGP Park Brașov	67,000
Romania VGP Park Bucharest	46,000
Germany VGP Park Erfurt 2*	42,000
Germany VGP Park Erfurt 3*	29,000
Germany VGP Park Halle 2*	15,000
Slovakia VGP Park Bratislava*	19,000
Total own portfolio	364,000

* assets destined for Saga Joint Venture, reported as held for sale

Projects delivered during FY2023

On behalf of JV

VGP Park	m²
Netherlands VGP Park Roosendaal	9,000
Spain VGP Park San Fernando de Henares	28,000
Germany VGP Park Gießen Am alten Flughafen	184,000
Germany VGP Park Magdeburg	45,000
Germany VGP Park Berlin Oberkrämer	11,000
Total on behalf of JV	277,000

Total delivered assets 641,000

It’s expected that the assets under construction at year-end ’25 will be delivered during ’26. In summary, the total portfolio now contains 295 buildings (81 buildings under construction and 214 completed buildings) for a total surface of 5.7 million m², spread over 15 countries and is 98% let.

Development activity (in m²) YE'22 to YE'23

Country	Completed assets Rentable space (m²)	Number of buildings (#)	Assets under construction Rentable space (m²)	Number of buildings (#)	Total Rentable space (m²)	Number of buildings (#)
Austria	39,000	3	83,000	3	122,000	6
France	—	—	39,000	1	39,000	1
Germany	2,901,000	93	229,000	6	3,130,000	99
Hungary	197,000	12	106,000	5	303,000	16
Italy	86,000	7	19,000	1	105,000	8
Latvia	134,000	4	—	—	134,000	4
Netherlands	259,000	6	—	—	259,000	6
Portugal	50,000	3	32,000	1	81,000	4
Romania	315,000	15	86,000	2	401,000	17
Serbia	—	—	77,000	2	77,000	2
Spain	389,000	21	7,000	1	397,000	22
Czechia	768,000	49	48,000	3	816,000	52
Slovakia	227,000	9	48,000	2	275,000	11
Total	5,365,000	222	774,000	26	6,139,000	248

Ownership	Completed assets Rentable space (m²)	number of buildings (#)	Assets under construction Rentable space (m²)	number of buildings (#)	Total Rentable space (m²)	number of buildings (#)
Own (including on behalf of JV)	1,609,000	52	774,000	26	2,383,000	78
JV	3,756,000	170	—	—	3,756,000	170
Total	5,365,000	222	774,000	26	6,139,000	248

Land bank evolution

VGP acquired 7.500,000 m² of development land and a further 850,000 m² has been committed, subject to permits, which brings the remaining total owned and committed land bank for development to 9.4 million m², which supports more than 6.5 million m² of future lettable area ³ . In February ’25, VGP sold its stake in the LPM Joint Venture, which holds 120,000 m² of development land.

³ Including Joint Ventures at 100%

Land bridge (in million m²)	Owned 12/22	Acquired	Deployed	Owned 12/23	Committed 12/23	Owned and Committed 12/23	Sold in 2024	Proforma Land bank
	8.0	1.9	-1.3	8.6	0.8	9.4	-0.7	8.6

BUSINESS REVIEW

Country

Total acquisitions amounted to €315.9 million in ’24. Main acquisitions are located in Germany and France, as anticipated in VGP’s equity raise in Q4 ’21, a number of such opportunities were expected to come on the market in established economies in Europe. VGP has been able to secure main sites such as:

• VGP Park Rüsselsheim, Germany, with a total surface of 170,000 m² being the biggest acquisition of the year and an unique brownfield redevelopment opportunity. The project, acquired from the Stellantis group, represents one of the largest and most central industrial property developments in Germany. VGP’s vision for this acquisition involves the creation of a business park spanning approximately 140,000 m² tailored for industrial companies and small and medium-sized value-added businesses. In line with its commitment to responsible development, VGP will operate with care to optimize the benefits of the development for the local community in close coordination with the responsible authorities. The Stellantis group will lease the main part of the site for three years and a schooling center for 10 years. The annual rent amounts to €8.3 million. During this period VGP will prepare all permitting and ancillary formalities in order to redevelop the site. The purchase price of Rüsselsheim has been fully paid for in ’24.

• VGP Park Vélizy, France, a brownfield of 135,000 m², an iconic plot in the Paris region. This was acquired from the Stellantis group and is located 10 km from the inner city of Paris, boasting an exceptional location with direct access to the outer ring road of Paris (A86). VGP plans to develop a business park of around 80,000 m² for industrial companies and small and medium-sized value-added businesses. Construction work is due to start in the second half of 2025, with the first buildings due for delivery in 2026. As with all the Group's projects, an ambitious environmental approach will be applied to this park and all buildings will achieve a BREEAM Excellent certification as a minimum.

• VGP Park Mulhouse, France, a 13 ha brownfield, acquired from the Stellantis group and is located on part of the Stellantis site in Mulhouse, France. The Group plans to rapidly develop a modern business park of around 200,000 m² for industrial and logistics companies. All future buildings will aim for at least BREEAM Excellent certification.

• VGP Park Leipzig Flughafen, Germany, with a total land size of 110,000 m², allowing for over 100,000 m² of development.

• VGP Park Wiesloch-Walldorf, Germany, with a total land size of 75,000 m², allowing for over 50,000 m² of development. Given its location, VGP intends to explore also alternative developments such as smaller and more flexible units.

• VGP Park Rouen, France, with a total land size of 150,000 m². This acquisition completes the VGP Park Rouen, following earlier acquisitions of 110,000 m² at the same location. The complete park allows for minimum 110,000 m² of development. This was VGP’s first project in France and in the meantime with a first building, fully pre-let, of 15,000 m² under construction.

In January ’25, VGP has also acquired its first site in Vejle, Denmark. The site is located in the northern part of the Triangle Region, a commercially important region in the centre of Denmark. On an area of more than 115,000 m² will be developed more than 50,000 m² of semi-industrial premises which are suitable for light industry and logistics services. The site is adjacent to the highway E45, exit 63 Vejle Syd. The park will offer full-scale services including photovoltaics, on-site electric car charging and high-quality technical and sustainable features.

Finally, in February ’25, VGP sold its stake for a consideration of approximately €38 million in the LPM Joint Venture, which envisages to develop a site of 120,000 m² in the vicinity of the Port of Moerdijk in The Netherlands.

The land bank ³ is equally geographically spread between Eastern (10%) and Western Europe (90%) in m². The largest land positions are held in Germany (17%), the Netherlands ¹ (11%), Romania (11%), Serbia (10%) and Spain (7%). In total 55% of the land bank is owned or committed by VGP for its own portfolio, whereas 45% is in co-ownership with various Joint Venture partners. It concerns mainly LPM (120,000 m²) in the Netherlands (sold in February ’25), Grekon (15,000 m²) in Germany, Belartza (215,000 m²) in Spain and Ymir (11,000 m²) remaining development land in VGP Park Münich (building D).

³ Including land held by the First, Second, Third and Development Joint Ventures in amount of 1.1 million m².
¹ Includes LPM with 120,000 m² and has been sold in ‘25

Geographical spread of land (in m² incl. JV's)
Eastern Euope – 10%
Western Europe – 90%
15 countries
9.4 million m²

Land by ownership incl committed land (in m²)
Joint Ventures – 45%
Own portfolio – 55%

Renewable Energy

The gross renewable energy income over 2023 was €10.4 million compared to €7.0 million over FY2022. This was driven by an increase of 25.8% in the effective production sold in FY 2023 to 111 GWh, at a lower average energy price of €94/MWh (vs €115/MWh in 2022). The operational solar capacity increased significantly to 203.1 MWp ³, up 70% year-over-year which should equate to a marketable production potential of circa 175 GWh. As of January 2024, the Group possesses a licence to use the grid and trade energy on behalf of our tenants in Germany, which will facilitate distribution of produced renewable energy across our German parks. The Group has applied for a similar licence in Romania. As of Dec 2023, a total of 51 projects representing 57.0 MWp are under construction (of which circa half is expected to go into production during first 6 months of 2024 pending grid connection approval). Including projects under construction the total solar power generation capacity will increase to 310.1 MWp spread over 113 roof-projects in eight countries. As at the 31st of December 2023 this represents a total aggregate investment amount of €107 million (incl. current commitments for projects under construction). With regards to the pipeline, an additional 79 solar power projects are in contractual/design phase (including in five additional countries) which equates to an added power generation capacity of 77.8 MWp. The current total solar portfolio, including pipeline projects, totals 387.9 MWp and is well underway towards the 300 MWp target by 2025.

³ Including projects under construction# Capital and liquidity position

Total cash balance as at 27 December 2023 stood at €2,195.9 million and increased further in February 2024 with €350 million drawdown on the new credit facility from the European Investment Bank. The gearing ratio amounts to 26.5%. The Allianz and Deka Joint Ventures, with stabilized assets, have an LTV of 28.8%, or 31.7% when taking the Development Joint Ventures also into account, who have only development land and no credit facilities in place. Pro forma proportional LTV amounts to 35.6%.

— During 2023 VGP was able to recycle net €1,351.4 (gross €1,778.7) million from two closings with respectively the First and Second Joint venture as well as a first closing with the Fifth Joint Venture (Deka). Following the new joint venture agreements with the Fifth and Sixth Joint Venture, VGP is currently preparing three transfers in 2024, two of which are set to materialize in the first half of 2024 and a third closing with the Fifth Joint Venture is planned to materialize in the second half of 2024. These transactions are expected to generate more than €300 million of gross cash proceeds.

— Two bonds that came to maturity, respectively in April ‘23 (€75 million) and September ‘23 (€115 million) have been fully repaid. This has lowered the average cost of debt to 1.7% at year-end. The average term of the credit facilities amounts to 4.4 years. A dividend of €35 million has been paid out in May ‘23 as well. Within 2024 and ‘25, VGP will see two bonds of respectively €75 million and €90 million coming to maturity. It is currently envisaged to not refinance these and repay the bonds from available liquidity.

— To date, VGP has also €250 million of undrawn revolving credit facilities available and as per 15 December 2023, VGP Renewable Energy NV, a wholly owned subsidiary of VGP NV concluded a credit facility agreement with the European Investment Bank (“EIB”) for a total amount of €140 million. The facility will be made available along VGP’s progress in its renewable energy roll out. As per 15 February 2024, VGP has drawn as such a first tranche of €35 million. This drawdown will be repaid semi-annually as of February 2025 in 15 equal instalments. The interest rate has been fixed at 3.41%. The covenants of the facility are aligned on the conditions of the outstanding bonds.

— Finally, Fitch, the credit rating agency, affirmed a BBB- rating with a stable outlook for VGP NV on 28 September ‘23. According to Fitch: “The rating reflects VGP's disciplined approach to property development risk from land purchase price, location and quality of product, pre- lets, development profit headroom, to building completion and when assets are monetised into pre-funded, identified joint ventures (JV). Under VGP's financial template, depending on the development profit headroom, it gets its cost-to-build outlay back in cash proceeds from monetisations. These front-end factors support a scenario of successfully attracting other JV partners as the historical Allianz JV exclusivity has changed.”

¹ Includes 21MWp of third-party owned systems
² Including €7.8 million classified as disposal group held for sale
³ Adjusted for transactions with Deka, Areim, LPM and the new credit facility of EIB. Proportional LTV at 31 December 2023 amounts to 56.5%

PAGE 042
VGP NV ANNUAL REPORT 2023
VGP IN 2023

Dividend

The board of directors proposes to the annual shareholders meeting an ordinary gross dividend distribution of €6.75 per share, or €101.3 million, which is composed of an ordinary gross dividend of €5.15 per share, or €77.3 million (an increase of 7.5% versus last year) and an extraordinary gross dividend of €1.60 per share, or €24.0 million as a result of the record net cash recycled with the existing and new Joint Ventures in ‘23.

Progress towards our Sustainable Development Goals

In the financial year 2023, VGP has made significant strides in both sustainability initiatives and operational achievements. Here are some highlights:

Promoting Green Energy Adoption and Expansion of Renewable Energy Initiatives

VGP has obtained registered utility status in Germany and is anticipating to achieve the same in Romania. This milestone enables the Group to leverage the existing photovoltaic projects more effectively, facilitating the distribution of green energy across VGP Parks. Furthermore, VGP has surpassed the 170 MWp-mark in operational solar capacity. With all projects in the pipeline, the Group will be able to produce more green energy than the tenants’ total annual electricity consumption. The 2023 new lease contract template requires tenants to procure green energy and building standard is based on air heat pumps (as opposed to gas-powered heating). Additionally, the implementation of a group-wide smart meter management system enhances our ability to monitor consumption patterns and identify areas for improvement.

Carbon Pricing, Supplier Engagement and CRREM¹ pathway

In 2023 the Group has introduced in-house carbon pricing for project evaluation purposes whilst supplier engagement regarding embodied carbon improvements has further expanded, reinforcing our dedication to embodied carbon reduction efforts. Several initiatives have been identified to facilitate bringing our entire portfolio CRREM performance into compliance with the 1.5°C pathway, reflecting our proactive approach to addressing climate change risks.

Employee Development Initiatives

The launch of VGP Academy is to support the development and training of the Group’s employees, ensuring our workforce is equipped with the necessary skills and knowledge to drive our sustainability agenda forward.

EU Taxonomy and Enhanced Green Bonds Allocation

In 2023 VGP has published a biodiversity strategy and implemented additional actions in accordance with EU Taxonomy standards, reaffirming our commitment to environmental stewardship. Furthermore, thanks to significant solar investments and certification improvements, the allocation of Green bonds for all €1.8 billion worth of outstanding VGP Green bonds are now allocated to investments in renewables, eco-efficiency measures, and projects meeting at least BREEAM Excellent/DGNB Gold standards (previously the allocation included BREEAM Very Good).

Recognition Building A in VGP Park Laatzen has achieved Platinum certification, marking a significant milestone as it is the first developer-led industrial property project to receive such recognition from DGNB. At the same time, the Group as a whole achieved a 4-star developer ranking in GRESB, the second-highest score for a European developer, underscoring our commitment to sustainability performance and transparency. As of the 19th of March 2023, VGP was included in the BEL ESG index by Euronext. This index was designed to meet sustainable investment needs and tracks the twenty Brussels-listed companies demonstrating the best Environmental, Social and Governance (ESG) practices.

¹ Carbon Risk Real Estate Monitor

VGP Park Munich, Germany

PAGE 044
VGP NV ANNUAL REPORT 2023
VGP IN 2023

General market overview

VGP Park Sordio, Italy

COMPANY REPORT 2023
PAGE 045

GENERAL MARKET OVERVIEW 2023

OCCUPATIONAL LOGISTICS MARKET TRENDS

Five things to know

• Demand Down by 19% YoY in 2023 despite more active leasing during H1 in most markets
• Rent Growth drops to 5.9% YoY but still above long-term trend
• Pipeline Slowing development starts with space under construction down 38% YoY in Q4
• Vacancy 2.5% across Europe, with select markets recording vacancy levels above 5%
• Supply New completions down by 35% YoY, starting to reflect falling pipeline figures since Q4 2022

Conclusion: Temporarily higher supply levels but continued lack of modern, energy efficient space in most markets will keep upward pressure on rents

PAGE 046
VGP NV ANNUAL REPORT 2023
VGP IN 2023

European logistics take-up 2023

Take up levels on par with strong pre-pandemic years Weak macroeconomic environment and rising geopolitical tensions in Q4 add to occupiers’ caution. Total 2023 take-up volumes down by around 19% YoY and 17% below the 5-year average. Inquiries still strong for smaller units as occupiers continue to look for both short- and long-term space options. Gradual improving economic and financial conditions this year will not be robust enough to motivate occupiers to be more active.

Source: JLL Research, iO Partners

Including units of 5,000 m² and over in Belgium, Czech Republic, Germany, Hungary, Italy, Netherlands, Poland, Romania, Slovakia, Spain and Sweden; 10,000 m² and over in France and UK

	Q1	Q2	Q3	Q4	5 Yrs Av (2018-22)
Million m²	6.7	7.5	7.9	9.1	31.2

0 5 10 15 20 25 30 35 40 Million m²

Q1 Q1 Q1 Q1 5 Yrs Av (2018-22)

COMPANY REPORT 2023
PAGE 047

Logistics take-up by sector

Manufacturing led space requirements expanding while e-commerce retailers pause

Take-up share by sector, FY 2023

Rising share of manufacturing driven demand

Including units of 5,000 m² and over in Belgium, Czech Republic, Germany, Hungary, Italy, Netherlands, Poland, Romania and Spain; 10,000 m² and over in France and UK

Source: JLL, iO Partners

• 3PL – 42%
• Retail – 19%
• E-commerce – 6%
• Manufacturing – 21%
• Others – 12%

PAGE 048
VGP NV ANNUAL REPORT 2023
VGP IN 2023

Demand Drivers

Source: JLL, iO Partners

3PL and manufacturer demand stable during H1 2024 with focus on near-term strategies while positioning for longer-term.

Safeguarding against supply chain disruption

Implementing supplier diversification, nearshoring production strategies, and strengthening regional supply chains.

Upgrading through new built/retrofitted stock

Meeting latest sustainability standards including energy-efficiency, renewable energy sources, and EV-charging.

New manufacturing

Growth of EV and battery production, renewable energy solutions, pharmaceutical development, and advanced manufacturing.# E-commerce expansion to return in 2025

Improving last mile delivery efficiency to respond to evolving customer expectations.

COMPANY REPORT 2023 PAGE 049

GENERAL MARKET OVERVIEW

A persisting supply-demand imbalance

Higher vacancy rates give more flexibility to tenants, but suitable space remains limited. Europe take-up and completion figures based on units of 1,000 m² and over in Belgium, Czech Republic, France, Germany, Hungary, Italy, Netherlands, Poland, Romania, Slovakia, Spain and Sweden & units of 10,000 m² in the UK; Estimated European vacancy rate comprises Czech Republic, France, Germany, Hungary, Italy, Netherlands, Poland, Romania, Slovakia, Spain and UK.

Source: JLL, iO Partners

	FY 2023	Million m²	%
Take-Up		28.5	-19.4% YoY
Completions		21.7	-8% YoY
Vacancy rate		5.7%

Take-up, Completions, Estimated vacancy rate (RHS)

PAGE 050

VGP NV ANNUAL REPORT 2023

VGP IN 2023

Vacancy rate at the end of Q4 2023

Higher vacancy rates put non-prime space at a disadvantage.

Source: JLL, iO Partners

European average vacancy rate

Amsterdam
Gothenburg
Stockholm
Birmingham
London
Brussels
Antwerp
Lyon
Milan
Rome
Barcelona
Madrid
Prague
Bratislava
Budapest
Bucharest
Poznań
Warsaw
Paris
Glasgow
Rotterdam

Map Key:
* Stable
* Increase
* Decrease

City	Vacancy Rate (%)
Amsterdam	8.6
Gothenburg	5.8
Stockholm	1.3
Birmingham	0.5
London	1.0
Brussels	7.1
Antwerp	8.6
Lyon	6.6
Milan	1.1
Rome	3.9
Barcelona	3.4
Madrid	4.6
Prague	1.0
Bratislava	2.0
Budapest	1.5
Bucharest	4.8
Poznań	2.3
Warsaw	5.0
Paris	9.3
Glasgow	6.5
Rotterdam	13.3

0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%

COMPANY REPORT 2023 PAGE 051

GENERAL MARKET OVERVIEW

Supply/demand appears more balanced

Yet mismatch between available supply and demand requirements persists. Including units of 1,000 m² and over in Belgium, Czech Republic, France, Germany, Hungary, Italy, Netherlands, Poland, Romania, Slovakia, Spain and Sweden; 10,000 m² and over in UK.

• incl. vacant units and space speculatively under construction.

Source: JLL, iO Partners

Available supply* at end Q4 2023 compared with 5yr av. take-up (Q1 ‘19 – Q4 ‘23)

Market	Years of available supply
Belgium	0.4
Slovakia	1.1
Czech Republic	0.5
Romania	1.0
Hungary	1.2
The Netherlands	0.6
Sweden	1.6
France	0.5
Italy	1.0
Germany	0.4
Spain	1.4
Poland	1.3
UK	1.6

Available space end Q4 2023
5yr rolling take-up (Q1 2019-Q4 2023)

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 Million m²

PAGE 052

VGP NV ANNUAL REPORT 2023

VGP IN 2023

Space under construction across Europe at the end of Q4 2023

A slowdown in speculative developments elevates BTS/pre-let share. Including units of 1,000 m² and over in Belgium, Czech Republic, France, Germany, Hungary, Italy, Netherlands, Poland, Romania, Slovakia, Spain and Sweden; 10,000 m² and over in UK.

Source: JLL, iO Partners

European space under construction end Q4 2023

	5 Yrs Av (2018–2022)	Q4 2021	Q4 2022	Q4 2023
Speculative space	27%	25%	29%	34%
under construction
Speculative BTS/pre-let	43%	42%

0 5 10 15 20 25

Country	Speculative space under construction (In thousand m²)
Belgium	79
Slovakia	78
Czech Republic	96
Romania	69
Hungary	128
The Netherlands	90
Sweden	66
France	68
Italy	75
Germany	70
Spain	310
Poland	130
UK	140

0 500 1,000 1,500 2,000 2,000In thousand m²

Hamburg
Frankfurt
Oslo
Stockholm
Helsinki
Birmingham
London
Brussels
Münich
Lyon
Milan
Rome
Barcelona
Madrid
Lisbon
Prague
Bratislava
Budapest
Bucharest
Athens
Poznań
Warsaw
Paris
Dublin
Rotterdam

COMPANY REPORT 2023 PAGE 053

GENERAL MARKET OVERVIEW

Logistics prime rents* at the end of Q4 2023

Rental growth continues but at a slower rate in some markets.

• € per m²

Source: JLL, iO Partners

Gothenburg

Map Key:
* Stable
* Increase

VGP Park Bucharest, Romania

COMPANY REPORT 2023 PAGE 055

GENERAL MARKET OVERVIEW

INDUSTRIAL & LOGISTICS CAPITAL MARKET TRENDS

Higher swap rates put a break on volumes – strong fundamentals but returns are squeezed.

Volume

Investment volumes still low: -10% YoY in 2023.

Yields/Bonds

Gap between bond and real estate yields narrows further.

ESG

Green liquidity premiums now clear.

Prime Yields

15–25bps outward shift QoQ in Q4 on par with Q3 with stabilization expected in Q1.

Financing

Debt cost stable but expected to remain high through H1 2024.

Outlook

Prime yields stabilizing in most markets throughout 2024. Equity heavy buyers dominate, institutional investors slowly coming back.

1. 3
2. 5
3. 2
4. 4

PAGE 056

VGP NV ANNUAL REPORT 2023

VGP IN 2023

Industrial investment remains subdued

Lingering economic weakness and high financing costs fuel investor cautiousness.

Source: JLL, iO Partners

Direct Investment Volumes

Transaction volumes down by 10% YoY in 2023 and 27% if compared to the 5-year (2018–2022) average. Share of total CRE investment remains above pre-Covid levels (30%). Transaction activity concentrated in major Western European markets. Lower levels in Nordics and Southern Europe, while activity is limited in CEE and emerging markets. Lack of portfolio deals means majority of transactions are smaller between €10-25 million. Despite financial backdrop, investment capital remain attracted to the sector long-term. JLL’s bid intensity index shows logistics leading the recovery.

	€ billions	% share of total CRE Investment
Q1
Q2
Q3
Q4
I&L % share of total CRE investment

0 5 10 15 20 25 30 35 40 45 50 55 60 65 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

COMPANY REPORT 2023 PAGE 057

GENERAL MARKET OVERVIEW

2023 investment by geography (€ billion)

Geographically diverging investment activity.

*Figures exclude Pan-European portfolio transactions volumes not associated with single country markets and Entity Level transactions (indirect deals).

Source: JLL, iO Partners

Country	Investment in Billion	YoY
Germany	6.6	-21%
UK	4.9	-56%
Nordics	4.0	-41%
Southern Europe	3.2	-43%
France	2.6	-60%
Benelux	2.0	-73%
CEE	1.3	-55%

Transaction volumes up 15% QoQ in Q4 supported by increasing deal activity in select markets. Signs point to downward trend slowing in most regions. Germany attracts strong investor appetite, with H1 2024 volumes 6-times higher compared to H2 2023. Increased H1 volumes due to improving portfolio and larger-sized (€ 250m+) single asset transaction activity. Strengthening Q4 activity in the Nordics and Southern Europe contributes to slower YoY declines. Marginally improving Q4 volumes in the Benelux and CEE, but still muted compared to 2022.

PAGE 058

VGP NV ANNUAL REPORT 2023

VGP IN 2023

Investment activity in 2023

Q4 investor activity point to improving confidence in outlook and commitment to sector.

Source: JLL, iO Partners

European industrial investment volumes – FY 2023

• € 28.3 bn (exc. entity deals) -50% YoY / -41% 5yr av
• € 30.1 bn (inc. entity deals) -49% YoY / -41% 5yr av

	Q4 total volume	Q3 total volume
Top 10 deals represent 35% of Q4 total volume – down from 50% in Q3
15 transactions exceeded € 250 million mark in Q4 – up from 10 in Q3
30% of total Q4 transaction volume were portfolio deals, down from 45% in Q3.

Key insight Q4 2023: Capital sourced outside of Europe and globally accounted for 35% of total Q4 transaction volumes – marginally up from the previous three quarters. Global investors took the lead in Q4 with over € 3.5 bn, followed by UK investors (€ 2.1 bn) and North American investors (€ 2.3 bn).

• Excluding entity deals
• Including entity deals

0 50 10 15 20 25

COMPANY REPORT 2023 PAGE 059

GENERAL MARKET OVERVIEW

Prime logistics yields at Q4 2023

Prime yields moving slowly towards stabilization, European average up by 40 bps YoY.

Source: JLL, iO Partners

European yield movements Q4 2023 yields by market (vs Q3’23 and Q4’22 yields)

Market	Q4 2022	Q3 2023	Q4 2023
Bucharest
Budapest
Bratislava
Warsaw
Lisbon
Oslo
Helsinki
Manchester
Birmingham
Stockholm
Milan
Prague
Barcelona
Dublin
Antwerp
London
Rotterdam
Paris
Berlin
Frankfurt

2% 3% 4% 5% 6% 7%
2018
2019
2020
2021
2022
Q1 2023
Q2 2023
Q3 2023
Q4 2023

CEE Europe
Western Europe

Q4 2022
Q3 2023
Q4 2023

2% 3% 4% 5% 6% 7% 9% 8%

VGP Park Velizy, France

Report of the Board of Directors

PAGE 062

VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Corporate governance statement

COMPANY REPORT 2023 PAGE 063

CORPORATE GOVERNANCE STATEMENT

Principles

VGP adopts the Belgian Code on Corporate Governance (hereinafter the “Belgian Corporate Governance Code” or the “Code 2020”) as its reference code on corporate governance. The Code 2020 is available on the website of the Belgian Corporate Governance Committee (www.corporategovernance-committee.be).

As required by the Code 2020, the Board of Directors has drawn up the VGP Corporate Governance Charter according to the recommendations of the Code 2020 published on 17 May 2019 and taking into account the provisions of the Code on Companies and Associations (“CCA”) introduced by the law of 23 March 2019.

As required by the Code 2020, the Company’s Corporate Governance Charter describes the main aspects of its corporate governance policy. The Corporate Governance Charter was last updated on 1 January 2021 and is available on the Company’s website (Corporate– governance– VGP Group vgpparks.eu).

However, the Board of Directors is of the opinion that the Company is justified in not adhering to certain principles of the Code 2020, considering the Company’s particular situation. These deviations are explained below:

i. The Company does not intend to set up a nomination committee. By doing so, the Company, as a smaller listed company (in terms of employees), deviates from the principles 8.17 and further of the Code 2020. Given its relatively small size and the small size of the Company’s Board of Directors, the Company believes setting up a nomination committee would at this stage overly complicate its decision-making processes.

ii. The Company deviates from principle 7.41 of the Code 2020 by not including contractual provisions to delay payment or clawback provisions in relation to the variable remuneration of the Executive Management Team.# REPORT OF THE BOARD OF DIRECTORS

The Board of Directors is of the opinion that its remuneration policy and practices sufficiently address the underlying objective of this principle, as any payment of variable remuneration is only made following the finalisation of the financial results. In addition, the Board of Directors can reduce the amount of short-term variable remuneration of an Executive Management Team member based on its individual performance. With regards to long term variable remuneration, the LTIP also includes certain malus provisions. Finally, the Company may in certain events use legal remedies that may be available to it under applicable law to withhold payment or reclaim variable remuneration.

iii. The Company deviates from principle 5.21 of the Code 2020 by not requiring its non-executive directors to receive part of their remuneration in the form of shares in the Company and by not setting a minimum holding period for shares in the Company held by such persons. Considering that the Chairman of the Board of Directors and the CEO are reference shareholders, the Board of Directors is of the opinion that the long-term perspective of shareholders is adequately represented. Not requiring the other three (independent) directors to receive remuneration in shares in the Company allows for an outside perspective during the deliberations of the Board of Directors. The Board of Directors is of the opinion that this balanced composition contributes to long term value creation and is beneficial to the Company.

iv. The Company deviates from principle 5.25 of the Code 2020 by not requiring a minimum threshold of shares to be held by the executive management. The Company believes that its current operational structure and remuneration policy sufficiently incentivises its Executive Management Team to focus on long term value creation, given that: (i) the CEO is the main shareholder of the Company, (ii) the Board of Directors avoids setting performance criteria that could encourage the Executive Management Team to give preference to short-term goals that influence their variable remuneration but would have an adverse impact on VGP in the medium and long-term, and (iii) the members of the Executive Management Team (other than the CEO) participate in the LTIP, which is based on the net asset value growth of the Company spread over several years and includes a lock-up of 5 years.

v. Following the departure of the Company Secretary during 2022, the Board of Directors currently does not intend to appoint a new Company secretary. By doing so, the Company, as a smaller listed company, departs from the principles 6.27 and further of the Code 2020. Given its relatively small size and the small size of the Company’s board of directors, the Company believes appointing a new Company secretary is not necessary at this stage. As long as the Company does not appoint a Company secretary, the functions of secretary will be taken up by the Company’s CFO.

Governance structure

The Company has opted for a monistic governance model with a Board of Directors in accordance with article 3:126 and further of the CCA. The Company deems this model to be best suited for the needs and functioning of the Company and its business. The Board of Directors is authorised to perform all operations that are considered necessary or useful to achieve the Company’s purpose, except those reserved to the shareholders' meeting by law or as set out in the articles of association.

Board of Directors

The Board of Directors consists of five members, who are appointed by the General Meeting of Shareholders. The Chairman and the Chief Executive Officer are never the same individual. The Chief Executive Officer is the only Board member with an executive function. All other members are non-executive Directors. Three of the Directors are independent: Mrs Katherina Reiche (first appointed in 2017), Mrs Vera Gäde-Butzlaff (first appointed in 2017) and Mrs Ann Gaeremynck (first appointed in 2017). All three directors have been reappointed on the annual shareholders meeting in 2022 for a period of four years, i.e., until the closing of the annual shareholders’ meeting which will be held in the year 2026 and at which the decision will be taken to approve the annual accounts closed at 31 December 2026. The biographies for each of the current directors (see Board of Directors and Management), indicate the breadth of their business, financial and international experience. This gives the directors the range of skills, knowledge and experience essential to govern VGP. For a detailed description of the operation and responsibilities of the Board of Directors we refer to the VGP Corporate Governance Charter, which is published on the company’s website Corporate– governance– VGP Group (vgpparks.eu).

The Board of Directors held 12 board meetings in 2022. The most important points on the agenda were:

• approval of the 2021 annual accounts and 2022 semi-annual accounts;
• review and discussion on (on multiple occasions) leasing activities, development activities, land acquisitions, ESG initiatives and solar power installations as well as the broader evolutions of the logistics market in Europe
• approval to enter into a new credit facility with the EIB;

PAGE 064 VGP NV ANNUAL REPORT 2023 REPORT OF THE BOARD OF DIRECTORS

• review and discussion on cash flow forecast and available liquidity;
• review, discussion and/or approval of the tenth closing with the First Joint Venture, the fourth closing with the Second Joint Venture, along with approval of signing respective facility documents;
• Review and approval of the set-up of two new Joint Ventures with Deka and Areim;
• review, discussion and approval of the first closing with the Fifth Joint Venture (Deka– RED), along with approval of signing respective facility documents;
• Review and discussion of the Development Joint Ventures;
• Review and proposal to the annual shareholders’ meeting to reappoint the three independent directors for a new term of four years;
• Review and reappointment of the members of the audit and remuneration committee;
• Determination of the payment date and all other formalities related to the payment of the dividend;
• review and discussion on related party transaction procedure of Article 3:27 CCA;
• review and approval of press releases on the annual, semi-annual accounts as well as two trading updates;
• review and discussion of the property portfolio (i.e. investments, tenant issues etc.);
• review, discussion and approval of the investments and expansion of the land bank;
• approval of allocations and delegated authorities in respect of the Long-Term Incentive Plan, as well as extending the term of the existing Long-Term Incentive Plan;
• review and approval of the financial calendar of 2024.

Name	Year appointed	Next due for re-election	Meetings attended
Executive director and Chief Executive Officer
Jan Van Geet s.r.o. represented by Jan Van Geet	2021	2025	6
Non-executive director
VM Invest NV, represented by Bart Van Malderen	2021	2025	6
Independent, non-executive directors
GAEVAN BV represented by Ann Gaeremynck	2023	2027	6
Katherina Reiche	2023	2027	5
Vera Gäde-Butzlaff	2023	2027	6

Mrs Katherina Reiche, Mrs Vera Gäde-Butzlaff and Mrs Ann Gaeremynck are independent directors, in accordance with article 3:29 of the CCA. The composition of the Board of Directors meets the gender diversity requirement laid down in article 3:31 of the CCA.

Re-appointments at the 2022 annual shareholders’ meeting

The annual shareholders’ meeting of 17 May 2022 has reappointed the three independent directors expired for a new term of 4 years, until the closing of the annual shareholders’ meeting which will be held in the year 2026 and at which the decision will be taken to approve the annual accounts closed at 31 December 2026.

Committees of the Board of Directors

The Board of Directors has also established two advisory committees: an Audit Committee and a Remuneration Committee.

Audit Committee

The members of the Audit Committee are appointed by the Board of Directors. The Audit Committee is composed of three members who are all non-executive Directors. Two members, Mrs Ann Gaeremynck and Mrs Vera Gäde-Butzlaff, are independent directors. The members of the committee have sufficient relevant expertise, especially in accounting, auditing and financial matters, to effectively perform their functions. The duration of the appointment of a member of the Audit Committee may not exceed the duration of his/her directorship. Committee members’ terms of office may be renewed at the same time as their directorships. The Audit Committee is chaired by one of its members. The chairman of the board of directors may not chair the Audit Committee. For a detailed description of the operation and responsibilities of the Audit Committee we refer to the VGP Corporate Governance Charter, which is published on the company’s website: Corporate– governance– VGP Group (vgpparks.eu).

The Audit Committee meets at least four times a year and whenever circumstances require, at the request of its chairman, one of its members, the chairman of the Board of Directors, the CEO or the CFO. It decides if and when the CEO, CFO, the Statutory Auditor(s) or other people should attend its meetings.

COMPANY REPORT 2023 PAGE 065 CORPORATE GOVERNANCE STATEMENT

The Audit Committee meets at least twice a year with the statutory auditor to consult on matters falling under the power of the Audit Committee and on any matters arising from the audit. The CEO and CFO also attend the meetings of the Audit Committee. Given the size of the Group no internal audit function has currently been created.# REPORT OF THE BOARD OF DIRECTORS

Audit Committee

The Audit Committee met four times in 2023. The Chairwoman of the Audit Committee reported the outcome of each meeting to the Board of Directors. The most important points on the agenda were:
— discussion on the 2023 annual accounts and 2023 semi-annual accounts and business updates;
— analysis of the recommendations made by the statutory auditor;
— the different closings with the Joint Ventures;
— financing structure of the Group;
— assessment and discussion on the need to create an internal audit function;
— review and approval of accounting policies and procedures in respect of the Fifth Joint Venture;
— discussion, review and approval of proposed scope and fees for audit and non-audit work carried out by Deloitte.

Name	Year appointed	Executive or non-executive	Independent	Next due for re-election	Meetings attended
GAEVAN BV represented by Ann Gaeremynck (Chairwoman)	2023	Non-executive	Independent	2027	4
Vera Gäde-Butzlaff	2023	Non-executive	Independent	2027	4
VM Invest NV, represented by Bart Van Malderen	2021	Non-executive	—	2025	4

Remuneration Committee

The members of the Remuneration Committee are appointed by the Board of Directors. The Remuneration Committee is composed of three members who are all non-executive Directors. Two members, Mrs Ann Gaeremynck and Mrs Katherina Reiche are independent directors. The members of the Remuneration Committee possess the necessary independence, skills, knowledge, experience, and capacity to execute their duties effectively. The duration of the appointment of a member of the Remuneration Committee may not exceed the duration of his/her directorship. Committee members’ terms of office may be renewed at the same time as their directorships. The Remuneration Committee is chaired by the Chairman of the Board of Directors or by another non-executive director. For a detailed description of the operation and responsibilities of the Remuneration Committee we refer to the VGP Corporate Governance Charter, which is published on the company’s website Corporate– governance– VGP Group (vgpparks.eu). The Remuneration Committee meets at least two times per year, as well as whenever the committee needs to address imminent topics within the scope of its responsibilities. The CEO and CFO participate in the meetings when the remuneration plan proposed by the CEO for members of the management team is discussed, but not when their own remunerations are being decided. In fulfilling its responsibilities, the Remuneration Committee has access to all resources that it deems appropriate, including external advice or benchmarking as appropriate.

Name	Year appointed	Executive or non-executive	Independent	Next due for re-election	Meetings attended
VM Invest NV, represented by Bart Van Malderen (Chairman)	2021	Non-executive	—	2025	3
Katherina Reiche	2023	Non-executive	Independent	2027	2
GAEVAN BV represented by Ann Gaeremynck	2023	Non-executive	Independent	2027	3

The Remuneration Committee met three times in 2023. The most important points on the agenda were:
— assessment and determination of the achievement of the 2023 performance criteria and making recommendations to the Board of Directors in respect of the performance targets and criteria for the CEO, other members of the Executive Committee and senior managers for the financial year 2023;
— allocation of variable remuneration;
— allocations under the long-term incentive plan;
— assessing changes in the remuneration of board and committee members.

PAGE 066
VGP NV ANNUAL REPORT 2023

In order to maintain a flexible remuneration policy that enables it to attract, reward, incentivize and retain the necessary talent, the Company departs from the following principles of the Code 2023 in the framework of its remuneration policy:
— by not requiring its non-executive directors to receive part of their remuneration in the form of shares in the Company and by not setting a minimum holding period for shares in the Company held by such persons, if any, the Company departs from principle 3.1 of the Code 2023;
— by not setting a minimum threshold of shares to be held by the executive management as part of their remuneration, the Company departs from principle 3.5 of the Code 2023.

Nomination Committee

The company has not set up a Nomination Committee. The Company does not intend to set up a nomination committee. By doing so, the Company, as a smaller listed company, departs from the principles 4.17 and further of the Code 2023. Given its relatively small size and the small size of the Company’s Board of Directors, the Company believes setting up a nomination committee would at this stage overly complicate its decision-making processes.

Evaluation of the Board of Directors and its committees

In accordance with the VGP Corporate Governance Charter, the Board of Directors shall, every three years, conduct an evaluation of its size, composition and performance, and the size, composition and performance of its Committees, as well as the interaction with the executive management. The Board of Directors and its Committees carried out a self-assessment lastly in February 2021 with satisfactory result.

Remuneration report

Introduction

This remuneration report has been drafted in accordance with the provisions of article 7:7, §5 of the Code of Companies and Associations and the VGP Corporate Governance Charter (Annex 1), and takes into account the VGP Remuneration Policy, which is available at the Company’s website https://vgpparks.eu/en/investors/corporate-governance.

VGP Park Berlin, Germany

COMPANY REPORT 2023
PAGE 067

The VGP Remuneration Policy was submitted to and approved by the annual shareholders’ meeting of 23 May 2023 with a large majority (85.36% of the votes present gave their approval). This new remuneration policy took effect on 1 January 2023. This remuneration report must be read together with the VGP Remuneration Policy which, to the extent necessary, should be regarded as forming part of this remuneration report. The remuneration granted to the directors, the CEO and the other members of the Executive Management Team with respect to financial year 2023 is in line with the VGP Remuneration Policy. The remuneration report for the performance year 2022 was also approved by a large majority of 87.27% of the votes present at the Annual Shareholders’ Meeting held on 24 May 2023, and there were no specific comments to be taken into account in the remuneration for performance year 2023.

VGP 2023 highlights

In 2023, VGP recorded a solid business growth across its property portfolio with signed and renewed rental income of €357.7 million bringing total signed annualised committed leases increased to €758.6 million at the end of December 2023 (compared to €720.1 million at the end of 2022) (+€38.5 million). During 2023, 18 buildings were completed totalling 383,700 m² of lettable area which represents an annualised rent income of €18.6 million. These buildings were 100% let. At year-end 41 projects were under construction representing 881,700 m² of future lettable area, which, once delivered and fully let, will generate €31.7 million of annualised committed rental income; the portfolio under construction at year-end was 88% pre-let. The weighted average term of the annualised committed leases of the combined own and Joint Ventures’ portfolio stood at 8.5 years at the year-end (8.3 years as at 31 December 2022) and the occupancy rate (own and Joint Ventures’ portfolio) reached 97.8% at year-end (compared to 97.2% at the end of 2022). The land further expanded with the acquisition of 7,566,200 m² of new development land with a further 750,200 m² of committed land plots, pending permits, bringing the total secured (own and committed) land bank to 7,923,200 m² having circa 3.6 million m² development potential. In respect of the Joint Ventures, there were 3 closings, two with the Allianz Joint Ventures resulting in net cash proceeds totalling €538.8 million and one with a the Fifth Joint Venture (newly established in 2023) resulting net cash proceeds of €250 million. A Sixth Joint Venture with Areim has been established, which targets a closing in H1 2024 and has a total equity commitment of €1,200 million by both Joint Venture partners. As of 31 December 2023, the roofs of VGP’s building portfolio enabled a photovoltaic power generation capacity of 170.2MWp installed or under construction (compared to 153.1 MWp as at the end of December 2022). At the end of the year 90.5% of the portfolio, was certified (from which 63% at least BREEAM “Very Good” or equivalent) or having its certificate pending. Finally, The net valuation of the property portfolio as at 31 December 2023 showed a net valuation gain of €375.7 million against a net valuation loss of €159.1 million per 31 December 2022. Despite some devaluations on the portfolio, on the back of a turbulent market, the strong operating performance, margins on disposals, management fee income, net rent and renewable energy income and first time valuations resulted in a reported net profit for the year of €207.6 million for the financial year ended 31 December 2023 compared to a net loss of €1011.4 million for the financial year ended 31 December 2022.

Total remuneration

Total remuneration of the directors

The remuneration paid to non-executive directors consists solely of an annual fixed component plus the fee received for each meeting attended. These fees were approved by the annual shareholders’ meeting of 20 May 2021 and remained unchanged for 2023. The non-executive directors receive an annual fixed remuneration of €35,000. The chairman does not receive any additional fixed remuneration for its chair.The non-executive directors also receive an attendance fee of €1,700 for each meeting of the board of directors and €1,000 for each meeting of the Audit Committee or the Remuneration Committee they attend. Non-executive directors do not receive any variable compensation linked to results or other performance criteria. They are not entitled to stock options or shares (see Corporate Governance Statement – Principles regarding the deviation from Principle 9.34 of the 2020 Belgian Corporate Governance Code), nor to any supplementary pension scheme.

• Including the Joint Ventures at 75%.

As at 31 December 2023 the annualised committed leases for the Joint Ventures stood at €117.5 million (2022: €756.5 million).

• Calculated based on the contracted rent and estimated market rent for the vacant space.

PAGE 068

VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

2023 remuneration (in €)

Table A – Remuneration of the Board of Directors for the reported financial year 2023

| Base salary | Attendance Fees | Other benefits | One-year variable | Multi-year variable | Fixed | Variable | Non-executive directors | VM Invest NV represented by Bart Van Malderen Chair of the board of directors and Remuneration Committee | 75,000 | 26,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 101,000 | 100% | 0% | GAEVAN BV represented by Ann Gaeremynck Independent director and chair of the Audit Committee | 75,000 | 26,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 101,000 | 100% | 0% | Katherina Reiche Independent director | 75,000 | 14,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 89,000 | 100% | 0% | Vera Gäde-Butzlaff Independent director | 75,000 | 20,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 95,000 | 100% | 0% | Executive directors | | | | | | | | | | | Jan Van Geet s.r.o., represented by Jan Van Geet, Executive director 1 | 75,000 | 12,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 87,000 | 100% | 0% | Total | 375,000 | 98,000 | n.a. | n.a. | n.a. | n.a. | n.a. | 473,000 | 100% | 0% |

Total remuneration of the Executive Management Team

General

The Executive Management Team consists of Jan Van Geet (Chief Executive Officer), Piet Van Geet (Chief Financial Officer), Tomas Van Geet (Chief Commercial Officer), Miquel-David Martinez (Chief Technical Officer – Western Europe), Matthias Sander (Chief Operating Officer – Eastern Europe), Jonathan Watkins (Chief Operating Officer – Western Europe) and Martijn Vlutters (Vice President – Business Development & Investor Relations). Dirk Stoop (former Company Secretary) left the Executive Management Team upon his retirement as of 31 July 2023. Rolf Carls will join the executive management team as of January 2024 in the role of Chief Technical Officer – Eastern Europe.

The remuneration for the Executive Management Team consists of:

• A fixed remuneration: the base salary is determined in function of the individual responsibilities and skills of each member of the Executive Management Team. The CEO receives a base salary in his capacity as CEO as well as in his capacity as executive director.
• A short-term variable remuneration: linked to the performance criteria as described below. The criteria for the bonus of the CEO and their weights are the same as those for the Executive Management Team whereby specific targets for the CEO relate to the VGP Group. In case there is a deviation in performance criteria and payment level between the CEO and the other members of the Executive Management Team then this is separately disclosed in the below Performance Criteria table.
• A long-term variable remuneration: through participation to the long-term incentive plan (the “LTIP”). The CEO does not participate in the LTIP.
• A contribution for retirement benefits: although the members of the Executive Management Team are, in principle, responsible for their own pension arrangements, some members (depending on status and function) benefit from a pension allowance. The CEO does not benefit from any pension contribution.

• Other benefits in kind (such as, amongst others, car allowance and related expenses)

• The remuneration that Jan Van Geet s.r.o. receives in his capacity of CEO is reflected in tables B and C below.

• The natural persons listed here are the respective permanent representatives of (i) Jan Van Geet s.r.o., (ii) Urraco BV, (iii) Dirk Stoop BV, (iii) Tomas Van Geet s.r.o., (iv) Matthias Sander s.r.o., (v) Havbo Consulting Ltd. and (vi) MB Vlutters BV.

VGP Park Chomutov, Czech Republic

PAGE 070

VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Performance criteria short-term variable remuneration

For financial year 2023, the performance of the Executive Management Team was appraised on the basis of the following performance criteria:

Performance criteria	Relative weighting of the performance criteria	a) Minimum performance target and b) corresponding award payment level	a) Maximum target performance and b) corresponding award payment level	a) Measured performance and b) corresponding award payment level
Jan Van Geet s.r.o., represented by Jan Van Geet, CEO
Net profit of the Group	20%	a) 75% b) 0.15	a) 125% b) 0.75	a) 100% b) 0.40
Growth in committed anualised lease agreements	30%	a) 75% b) 0.15	a) 125% b) 0.25	a) 137% b) 0.25
— Cash flow from operations and divestments to joint ventures	30%
— Occupancy rate
— Buildings completed and started-up		a) 75% b) 0.10	a) 125% b) 0.20	a) 156% b) 0.20
— Pre-lets under construction
— Land acquisition
— Other ESG	15%	a) 75% b) 0.07	a) 125% b) 0.20	a) 97% b) 0.09
Other non-financial and organisational objectives	5%	a) 75% b) 0.10	a) 125% b) 0.06	a) 100% b) 0.06
Total bonus payment level		0.50	1.50	1.00
Total variable remuneration 2023	€ 600,000

Performance criteria	Relative weighting of the performance criteria	a) Minimum performance target and b) corresponding award payment level	a) Maximum target performance and b) corresponding award payment level	a) Measured performance and b) corresponding award payment level
Other members of Executive Management Team
Net profit of the Group	20%	a) 75% b) 0.15	a) 125% b) 0.36	a) 100% b) 0.20
Growth in committed anualised lease agreements	30%	a) 75% b) 0.16	a) 125% b) 0.55	a) 137% b) 0.55
— Cash flow from operations and divestments to joint ventures	30%
— Occupancy rate
— Buildings completed and started-up		a) 75% b) 0.20	a) 125% b) 0.55	a) 156% b) 0.55
— Pre-lets under construction
— Land acquisition
— Other ESG	15%	a) 75% b) 0.07	a) 125% b) 0.20	a) 97% b) 0.15
Other non-financial and organisational objectives	5%	a) 75% b) 0.03	a) 125% b) 0.08	a) 100% b) 0.05
Total bonus payment level		0.61	1.74	1.45
Total vaiable remuneration 2023	€ 1,530,000

The Company does not disclose the actual targets per criterion, as this would require the disclosure of commercially sensitive information.

COMPANY REPORT 2023

PAGE 071

CORPORATE GOVERNANCE STATEMENT

Reported financial year 2023

Taking into account the achievement of the abovementioned performance criteria in respect of the short-term variable remuneration, as well as the other aspects of the total remuneration package, the Board of Directors awarded the Executive Management Team with the following total remuneration for the financial year 2023:

2023 remuneration (in €)

Table B – Remuneration of the Executive Management Team for the reported financial year 2023

Base salary	Fees	Other benefits	One-year variable	Multi-year variable 1	Fixed	Variable	Proportion of fixed and variable remuneration
Executive Management Team
Jan Van Geet s.r.o., represented by Jan Van Geet, CEO 2	600,000	n.a.	41,133	600,000	n.a.	n.a.	n.a.
Other members of Executive Management Team	1,655,785	n.a.	225,094	1,530,000	3,565,571	n.a.	38,198
Total	2,255,785	n.a.	266,227	2,130,000	3,565,571	n.a.	38,198

Conclusion

The total amount of remuneration as set out above is in line with the VGP Remuneration Policy. More in particular, the remuneration package allows the Group to attract, retain and motivate selected profiles, taking account of the Group’s characteristics and challenges, while maintaining coherence between the remuneration of the members of the Board of Directors, the Executive Management Team and of all staff, properly and effectively managing risk and keeping the costs of the various remunerations under control. The total amount of remuneration, and more in particular, the variable fraction of the total remuneration package, contributes to the long-term performance of the Group by setting performance criteria that focus on the long-term objectives of the Group.

Share-based remuneration

For the financial year 2023, no share-based remuneration was granted.

Severance payments

For the financial year 2023, no severance payments were made in relation to the termination of management or employment agreements of any members of the Executive Management Team.

Claw-back

The Company deviates from principle 9.34 of the Code 2020 by not including contractual provisions to delay payment or clawback provisions in relation to the variable remuneration of the Executive Management Team. The Board of Directors is of the opinion that its remuneration policy and practices sufficiently address the underlying objective of this principle, as any payment of variable remuneration is only made following the finalisation of the financial results. In addition, the Board of Directors can reduce the amount of short-term variable remuneration of an Executive Management Team member based on its individual performance. With regards to long term variable remuneration, the LTIP also includes certain malus provisions. Finally, the Company may in certain events use legal remedies that may be available to it under applicable law to withhold payment or reclaim variable remuneration.

• Relates to the LTIP variable remuneration vested during the financial year.
• The remuneration that Jan Van Geet s.r.o.# VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Derogations from the remuneration policy

For the remuneration in respect of financial year 2023, VGP did not derogate from its existing remuneration practices.

Comparative information on the change of remuneration and company performance

With a view to increasing transparency of past, current and future remuneration programs and in alignment with investor interest and the legislative framework, the following table demonstrates the annual change, over a period of 6 years, in (i) the remuneration of members of the Board of Directors and the Executive Management Team, (ii) the performance of the Group on a consolidated basis and (iii) the average remuneration of the employees of VGP NV.

Table C1 – Comparative information on the change of remuneration and company performance

	2018	2019	2020	2021	2022	2023
Remuneration of non-executive directors
Total annual remuneration	182,000	396,500	412,000	396,000	412,000	386,000
Year-on-year difference (%)	—	118%	4%	-4%	4%	-6%
Number of non-executive directors under review	4	4	4	4	4	4
Remuneration of CEO and executive director
Total annual remuneration as executive director	16,000	93,000	91,000	91,000	93,000	87,000
Year-on-year difference (%)	7%	481%	-2%	0%	2%	-6%
Total annual remuneration as CEO	336,380	837,212	1,234,936	1,235,987	636,933	1,241,133
Year-on-year difference (%)	0%	149%	48%	0%	-48%	95%
Remuneration of the Executive Management Team
Total annual remuneration	1,621,658	5,739,044	4,467,293	3,275,630	3,575,084	7,014,648
Year-on-year difference (%)	33%	254%	-22%	-27%	9%	96%
Number of EMT members under review	6	7	7	7	7	6.5
Company performance
Net profit attributable to shareholders ('000 €)	121,106	205,613	370,939	650,055	(122,542)	87,292
Year-on-year difference (%)	26%	70%	80%	75%	n.m.	n.m.
Average remuneration per employee
Average salary per employee	72,715	76,065	74,512	79,565	72,871	70,375
Year-on-year difference (%)	23%	5%	-2%	7%	-8%	-3%

As requested by the Belgian Code of Companies and Associations, VGP reports the pay ratio of the CEO remuneration versus the lowest FTE employee remuneration (in its legal entity VGP NV). The 2023 pay ratio is 17.6.

1 The annual shareholders’ meeting of 17 May 2022 approved the payment of an extraordinary fee of € 20,000 to all independent directors to reflect to reflect their contribution to the further growth of the Group.

2 The increase in financial year 2019 is due to (i) the increase in base salary from € 30,000 to € 80,000 and (ii) a one-off extraordinary fee, granted to all members of the board of directors to reflect the contribution of the directors to the further growth of the Group and to ensure that their total remuneration for financial year 2019 was aligned to a more market-based remuneration. This increase and additional remuneration was approved by the annual shareholders meeting of 10 May 2019.

3 The increase was mainly due to the early termination of the VGP Misv incentive plan which resulted in the early vesting of the long-term incentives under this plan. The early termination of the VGP Misv plan had also some spill over effects on 2020 as for certain managers new allocations were granted under the new LTIP for a corresponding number of Units and with a lock-up period reflecting the remaining initial lock up period as applicable under the initial VGP MISV Plan. This resulted in a further vesting at the end of 2020. For more detailed information, please see table B included in the Annual Report of 2019 – page 71.

4 Includes multi year variable payment of € 5,595,905. During 2023, 908,661 units have vested, of which 12,777 units relate to members of the executive management team. The total pay-out of the 908,661 units amounts to € 7.3 million, which has been paid for € 6.8 million in 2023. The remainder is expected to be paid out in 2024.

5 As of 1 July 2023 only 5 members in EMT.

6 The average remuneration of employees is calculated on the basis of the “total annual gross wages” excluding company cars, divided by the number of employees of VGP NV on year over year bases for continues operations. These numbers do not take into account the remuneration of employees of the other Group companies.

COMPANY REPORT 2023

CORPORATE GOVERNANCE STATEMENT

Conduct and Compliance

Code of Conduct

During 2023 a formal Code of Conduct was introduced, which has been updated in July 2021. The Code of Conduct describes the key principles of conduct for the business environment, in which the Group operates. At the same time, a training program has been rolled out throughout the countries in which the Group operates in order to preserve the compliance culture across the Group. The Code of Conduct sets out the shared values of integrity, compliance with local and international law, protection of human rights, respect for employees and customers, the willingness to accept social responsibility, environmental awareness and an unequivocal stand against bribery and corruption.

The Code of Conduct describes in clear terms the principles which the VGP Group must adhere to and provides a number of examples of potential violations as well as good practice. The Code of Conduct as well as the Group’s compliance policies and procedures are made available to all VGP staff. VGP uses in-person training to familiarise employees with its contents and application in everyday scenarios. This training is mandatory for all employees having managerial responsibilities and is carried out progressively throughout the countries, in which VGP operates. There are a number of channels for reporting possible violations of the Code of Conduct, including a compliance hotline, see below.

Whistleblowing platform: compliance hotline

All employees and contractors are invited to report cases or suspicions of criminal activities, violations of national and international laws, and any serious threat or harm to the general interest of VGP, or breaches the Group Code of Conduct, by using the Group’s whistleblowing platform. The compliance hotline is available 24/7 from any location worldwide in all (15) spoken languages within the Group (https://vgp.speakup.report/en-GB/compliance/home). The whistleblowing platform allows anonymous reporting and ensures strict confidentiality of the identity of the reporter. The Group policy is to guarantee to not discipline, discriminate or retaliate against any employee or other person who in good faith reports information related to a violation. The Group head of legal and compliance investigates reported incidents, but the directors are ultimately responsible for taking the appropriate actions.

Anti-corruption

The Group aims at combatting and preventing corruption, bribery and influence peddling and has created various mechanism in order to comply with applicable laws. The Group General Counsel, checks the various operations in the different countries where the Group is active, such as the regulatory landscape, transactions and relationships with business partners. Management strictly enforces the Group’s zero tolerance principle regarding violations of the Code with regards to the Anti-corruption principle.

VGP Park San Fernando de Henares, Spain

Code of Conduct

The code of conduct and commitment to fight against corruption and influence peddling has been included in a dedicated section of the Group’s Code of Conduct. The code of conduct stresses on the “zero tolerance” principle for breaches of the anti-corruption principle and any violation will be sanctioned.

Internal Alert System

The Group has an externally based whistleblowing platform (the VGP Compliance Hotline), which enables all staff as well as contractors to confidentially, and anonymously, report incidents to the Group General Counsel. The whistleblowing procedure and platform are accessible at https://vgp.speakup.report/en-GB/compliance/home.

Third party due diligence

The Group has a “Know Your Supplier” procedure which consists of tailored due diligence to assess business partners’ risk of exposure to corruption before entering into contractual relationships. The due diligence may consist of questionnaires, internal and/or external background checks and investigations. Under certain circumstances the Group General Counsel reports due diligence findings to the relevant country manager or if required to the responsible COO or Group CEO to discuss the risk profile and provide recommendations. As part of the Group’s Supplier Code of Conduct, the Group seeks to include anti-corruption provisions in contracts with business partners, to remind the contracting party that corruption and/or unethical behaviour will not be tolerated.

Accounting checks

The Group has a collective decision-making process regarding investment, divestment and procurement. The Group applies a “four eyes” principle when processing invoices and staff expenses reimbursement. There is also a segregation of duties in the payment process. Manual entries in accounting are systematically reviewed by Group finance and accounts are reviewed by statutory auditors.

Training

To raise awareness and entrench the compliance culture within the Group, employees are required to participate to an annual e-training covering ethics and the prevention of corruption and influence peddling. In addition to the online training, new joiners can attend dedicated classroom or online trainings. Several training sessions were held throughout the Group.

Disciplinary sanctions

Disciplinary sanctions may be taken in cases of corruption, bribery or breaches of the Anti-corruption policy based on the Group’s zero tolerance principle.# Gift, meals and entertainment
The gift and entertainment policy states that hospitality, pro- motional or other business expenditure, received as well as given, need to be given or received in other forms than cash or cash equivalent, reasonable in value, infrequent, permit- ted under local laws, directly related to the promotion of the Group’s assets, know-how, products or services, the execu- tion of a contract, or to develop and maintain cordial business relations out of any tendering phase or in the frame of the Group’s ESG policy, approved (as the case may be), properly recorded in accounting and not given for any corrupt purpose or with the intent of receiving anything in return.

Sponsoring and charitable contributions

Donations to charities, non-profit initiatives or social pro- jects comprise a risk of having funds or assets of value being diverted for the personal use or benefit of a public official or a private party. Particular caution needs to be observed if a potential contribution is directed towards a company having an affiliation with a public official. Any contributions must be prior validated by the respective Chief Operating Officer or Chief Executive Officer.

Prevention of money laundering and terrorism financing

The procedure for prevention of money laundering and ter- rorism financing (AML) requires employees and managers to be vigilant and perform due diligences before entering into certain business relationships. These due diligences include identifying the partner company, evaluating the risk profile of the partner/operation, performing sanctions list screening and identifying potential ultimate beneficial owners and polit- ically exposed persons through background checks via public databases.

Transparency of transactions involving shares of VGP

The Board of Directors has adopted a Dealing Code on  Jan- uary  which has been updated by the Board of Directors of the Company on  December  to prevent the illegal use of inside information by VGP staff members and connected persons, and further updated on  May  to implement changes following the adoption of the new Code on Compa- nies and Associations. The purpose of this Dealing Code is to ensure that such per- sons do not abuse, nor place themselves under suspicion of abusing, and maintain the confidentiality of information that may be considered as Inside Information, especially in periods leading up to an announcement of financial results or of price sensitive events or decisions. Reference is also made to Annex  Rules preventing market abuse (Dealing Code) of the VGP Corporate Governance Char- ter on www.vgpparks.eu/investors/corporate-governance/.

Duty to report effective dealings

VGP staff members  must inform the Compliance Officer immediately within three () business days after they or a connected person have dealt in any of the Company’s finan- cial instruments, mentioning the date of the transaction, the nature of the dealing (purchase, sale, etc), the amount of finan- cial instrument and the total price of the dealing. Simultaneously, a notification has to be made to the FSMA by an executive staff member or connected person thereof by way of a form that is available on the website of the FSMA (www.fsma.be) and that can also be requested from the Com- pliance Officer.

Closed dealing periods

During so-called “closed” periods (being  calendar days before the announcement of an interim financial report or a year-end report which the Company is obliged to make pub- lic), directors, members of the Executive Management Team and employees may not trade in VGP financial instruments.

 As defined in Annex – Rules preventing market abuse (Dealing code) of the Company’s Corporate Governance Charter

Insider transactions during 

There were no insider transactions in  If any, these transactions were made public on the website of the FSMA (www.fsma.be)

Transparency notifications 

There were no transparency declarations in , however on  January , the Company received a transparency notifi- cation, by virtue of the merger of Alsgard SA with Little Rock S.a.r.l (formerly Little Rock SA), which occurred on Decem- ber . For further details we refer the Company’s website. Shareholding– VGP Group (vgpparks.eu). For further details on the Company’s shareholder structure as at December  as well as the description of authorisa- tion in respect of authorised capital, delegated to the Board of Directors, we refer to the section Information about the Share.

Conflict of interest

In accordance with Article : of the new Code on Compa- nies and Associations, a member of the Board of Directors should give the other members prior notice of any agenda items in respect of which he has a direct or indirect conflict of interest of a financial nature with the Company. There were no conflicts of interest reported in .

Data protection

The code of conduct and commitment to protect personal data and confidential information has been included in a dedicated section of the Group’s Code of Conduct. VGP safeguards the confidential information it receives from its clients as well as any other commercially sensitive information developed by VGP or available to it. Personal data are protected in accord-ance with VGP Personal Data Protection Policy. VGP estab- lishes IT procedures to protect such information. All team members are required to comply with the policies related to protection of confidential and sensitive information and to ensure that their handling of IT does not lead to any avoidable security risks. As a part of its business, VGP acquires signifi- cant amount of confidential information from its suppliers, cli- ents and other business partners, which are often protected by non-disclosure or similar agreements. All team members are required to strictly follow policies put in place to ensure compliance with such agreements. The Personal Data Protection policy can be found here: https:// www.vgpparks.eu/en/personal-data-protection-policy/. In addition, significant efforts are made in terms of awareness and training on the management of personal data: each employee receives online GDPR training, and the teams most exposed to data protection issues are provided with additional support. The Group aims to only use subcontractors that provide guarantees as to their appropriate technical and organiza- tional measures to ensure that processing and processing methods meet GDPR requirements and guarantee the protec- tion of the data subject’s rights.

Specific country requirements

Beyond the European Regulation on the Protection of Per- sonal Data, each Member State of the European Union has interpreted the provisions of the GDPR by the enactment of national standards and by the jurisprudence developed by its national authorities (courts and local data protection author- ities). For example, the most important legislation governing data protection in Germany is the Federal Data Protection Act (Bundesdatenschutzgesetz, or BDSG), which implements the EU's General Data Protection Regulation (GDPR) in the coun- try. The GDPR sets a high standard for data protection through- out the EU, but Germany has gone further by adding its own additional provisions, such as stricter rules on employee data protection, the need for explicit consent in certain cases, and additional requirements for data processing by public author- ities. In addition to the BDSG, Germany also has several other laws that govern specific areas of data protection.

Compliance awareness

The Group is committed to conducting business in an ethical and fair manner and the Group has a “zero tolerance” mindset against all forms of unethical practices, such as inappropriate, disrespectful or unlawful behaviour, corruption, bribery, influ- ence peddling and human rights violations. The Group’s com- pliance procedures are based on the principle of allocation of duties and responsibilities as well as promotion of compli- ance awareness through a “tone from the top” approach and active training programs to ensure accountability and strict and effective compliance within the Group.

Compliance governance framework

Aiming to ensure appropriate sharing of information, right level of accountability, due and effective support and promo- tion, VGP has set up a compliance organisation matching its footprint.

Board

The Board, with delegated execution to the CEO, is responsi- ble for compliance with all laws and regulations applying to the Group. Promoting compliance awareness from the top on a recurring basis is part of the Group’s compliance target.

Compliance organizational framework

The compliance environment is managed by the CEO, the Group General Counsel, and CFO. The responsibilities include:
— Making recommendations on compliance, due diligences and the business ethics environment
— Participating in the crisis management in case of a mate- rial compliance breach; and
— Making recommendations or taking any decision related to any compliance related matters including internal pro- motion of compliance.

Group General Counsel

The Group General Counsel supervises the Group’s regulatory compliance

Compliance Officer

The Group Compliance Officer function is fulfilled by the Group General Counsel for legal compliance.# The Compliance Officer’s scope of responsibility includes:

— Designing and monitoring the implementation of the Compliance Program (including the Code of Conduct, Anti-Bribery and Anti-Corruption Program, Anti-Money Laundering Procedures and Whistleblowing Policy);
— Promoting compliance awareness for all employees and managers through classroom trainings and information sessions from time to time
— Investigating possible compliance breaches, including breaches reported through the Compliance Hot Line, the Group’s confidential whistleblowing platform;

Group General Counsel and Compliance have support from a Local Legal support functions to fulfill their tasks. They may also request support and/or input from external advisors. A network of local legal and compliance correspondents assist in promoting compliance awareness as well as to monitor and provide support for local implementation of compliance procedures.

Risk management and internal controls

VGP is exposed to a wide variety of risks within the context of its business operations that can result in the objectives being affected or not achieved. Controlling those risks is a core task of the Board of Directors, the Executive Management and all other employees with managerial responsibilities. The risk management and control systems have been set up to achieve the following objectives:

— achievement of operational goals and strategy;
— operational excellence;
— reliability of and timely financial reporting, and;
— compliance with applicable laws and regulations.

The principles of the Committee of Sponsoring Organisations of the Treadway Commission (“COSO”) reference framework has served as a basis in the set-up of VGP’s risk management and control system.

Control Environment

VGP strives for an overall compliance and a risk-awareness attitude by defining clear roles and responsibilities in all rele- vant domains. This way, the company fosters an environment in which its business objectives and strategies are pursued in a controlled manner. This environment is created through the implementation of different policies and procedures, such as:

— Adoption of a Corporate Governance Charter and Code of Conduct;
— Decision and signatory authority limits;
— Quality management and financial reporting system

Given the size of the company and required flexibility these policies and procedures are not always formally documented. The Executive Management ensures that all VGP team members are fully aware of the policies and procedures and ensures that all VGP team members have sufficient under- standing or are adequately informed in order to develop suffi- cient risk management and control at all levels and in all areas of the Group.

Risk Management System

Risk management process and methodology

All employees are accountable for the timely identification and qualitative assessment of the risks (and significant changes to them) within their area of responsibility. Within the different management, review, and supporting processes, the risks associated with the business are identi- fied, analysed, pre-evaluated and challenged by internal and occasionally by external assessments. In addition to these integrated risk reviews, periodic assess- ments are performed to check whether proper risk review and control measures are in place and to discover unidentified or unreported risks. These processes are driven by the CEO, COOs and CFO which monitor and analyse on an on-going basis the various levels of risk and develop any action plan as appropriate. In addition, control activities are embedded in all key processes and systems in order to ensure proper achieve- ment of the company´s objectives. Any identified risks, which could have a material impact on the financial or operational performance of the Group are reported to the Board of Directors for further discussion and assessment and to allow the Board to decide whether such risks are acceptable from the point of view of the level of risk exposure.

COMPANY REPORT 2023
PAGE 077
SECTION

Most important risk factors

VGP has identified and analysed all its key corporate risks as disclosed in the ‘Risk Factors’ section in this annual report. These corporate risks are communicated throughout VGP’s organisation.

Statutory auditor

DELOITTE Bedrijfsrevisoren BV having its offices at Gateway Building, Luchthaven Nationaal J, 1747 Zaventem, Bel- gium represented by Mrs. Kathleen De Brabander has been appointed as Statutory Auditor.

The Statutory Auditor’s term of office expired immediately after the annual shareholders’ meeting held in 2016 and at which the decision has been taken to approve the annual accounts closed on 31December 2015.

The Board of Directors approved that Deloitte Bedrijfsrevi- soren/Réviseurs d’Entreprises BV/SRL was re-appointed as the Statutory Auditor for a new period of three years taking effect after the conclusion of the annual shareholders’ meet- ing of 27May 2019 and to set the fees at € 270,560 per year. This fee will be subject to an annual review reflecting the changes in audit scope which might be required in order to ensure that such audit scope is kept in line with the evolution of the VGP Group and is subject to indexation.

The audit fees for VGP NV and its fully controlled subsidiaries amounted to €1,279.7k for the year-end 2019. Additional non-audit services were performed during the year by Deloitte for which a total fee of €137.0k was incurred. These fees were mainly paid for the obtained ESG limited assurance report.

Audit fees for jointly controlled entities amounted to €1,269.4k. Additional non-audit services for jointly controlled entities amounted to €166.5k

Since the maximum statutory term of Deloitte's tenure as statutory auditor of the company as provided in Article 3:67 of the Companies and Associations Code will have been reached at that time, the company expects Deloitte to ten- der its resignation as statutory auditor of the Company at the Annual General Shareholders' Meeting to be held in the year 2025 at which it will be resolved to approve the financial state- ments closed as at 31December 2024.

For further details we refer the section Financial Review – note 18 included in this annual report.

VGP Park Riga, Latvia
PAGE 078
VGP NV ANNUAL REPORT 2023
REPORT OF THE BOARD OF DIRECTORS

Risk factors

COMPANY REPORT 2023
PAGE 079

RISK FACTORS

The following risk factors that could influence the Group’s activities, its financial status, its results and further develop- ment, have been identified by the Group. The Group takes and will continue to take the necessary measures to manage those risks as effectively as possible. The Group is amongst others exposed to:

1 Risks related to the Group’s growth strategy

1.1 The Group may not be able to continue its development activities in a sustained and profitable way, for which it depends on its ability to execute new lease agreements and dispose its real estate assets to the Joint Ventures

The Group’s revenues are determined by the ability to sign new lease contracts and by the disposal of real estate assets, in particular to the Second Joint Venture and Sixth Joint Ven- ture. The Group’s short-term cash flow may be affected if it is unable to continue successfully signing new lease contracts and successfully disposing real estate assets, which could have an adverse effect on the Group’s business, financial con- dition and results of operations. As a result, the Group’s solvency depends on its ability to create a healthy financial structure in the long term with (i) a sufficiently large recurring income stream from leasing agreements for the developed logistic properties (at both the Group’s and the Joint Ventures’ level) vis-à-vis the debt that is issued for financing the acquisition and the development of that logistic properties, and (ii) the Group’s ability to continue its development activities in a sustained and profitable way in order to produce income generating properties which once they have reached a mature stage can be sold to the Joint Ven- tures or eventually to a third party.

The Group is largely dependent on the income stream from the Joint Ventures.. As a result, the Group receives fee and dividend income from the Joint Ventures instead of leasing income from mature assets. Hence it is important that a suf- ficiently large recurrent income at the Joint Ventures’ level is created in order to upstream cash to the Group. Those divi- dend streams, as well as the proceeds of the disposal of the assets to the Joint Ventures, are important for the liquidity and the solvability of the Group for the purpose of cash recycling. The Group’s current income stream from the Joint Ventures as well as fee income from the Joint Ventures is rapidly increas- ing but still relatively limited compared to the considerable amount of debt (at both the Group’s as well as Joint Ventures’ level), as (i) the First Joint Venture has reached its investment capacity, (ii) the Second Joint Venture is still in its initial 5-year investment phase, (iii) the Fourth Joint Venture – which was intended to replace the investment capacity of the First Joint Venture has been terminated, (iii) the Fifth Joint Venture has partially acquired the targeted assets in Germany in 2022 and is set to acquire the remaining portfolio in 2023 (iv) the Sixth Joint Venture will become effective as from its first closing – which is planned for the first half of 2024, (v) the Third Joint Venture has for a large part completed its initial investment phase of VGP Park München in December 2021 and (v) the Development Joint Ventures are progressing in their develop- ment planning.# REPORT OF THE BOARD OF DIRECTORS

1 Risks related to the Group’s business activities and industry

Please also refer to the following risk factors, which are related hereto and which deal with certain aspects in more detail: risk factor 2.2 “The Group’s development projects require large initial investments and will only start to generate income after a period of time”, risk factor 1.2 “The Group may not have the required human and other resources to manage growth or to adequately and efficiently monitor its portfolio”, risk factor 1.3 “The Group may not be able to locate, secure and execute new opportunities for land acquisition, which are crucial for the implementation of the Group´s growth strategy”, risk factor 2.1 “The Group’s development projects may experience delays and other difficulties, especially in respect of receiving necessary permits and increases in construction costs”, risk factor 2.2 “The Group’s debt levels have substantially increased over the last years and the Group is exposed to a (re)financing risk” and risk factor 2.2 “The Group is exposed to risk of (re)financing from its Joint Ventures”. For more information on the relationship with the Joint Ventures, please see section Strategy – Strategic partnerships.

1.2 The Group may not have the required human and other resources to manage growth or to adequately and efficiently monitor its portfolio

The Group’s success depends in part on its ability to manage future expansion and to identify attractive investment opportunities, and to manage and monitor its portfolio. These requirements can place significant demands on management, support functions, accounting and financial control, sales and marketing and other resources, which involves a number of risks, including: the difficulty of assimilating operations and personnel in the Group’s operations, the potential disruption of ongoing business and distraction of management. We refer to Corporate Responsibility Report paragraph “ESG risks and opportunities” for further information. As at 31 December 2023, the Group has 1,193 employees (1,045 employees as at 31 December 2022). The Group aims to have a sufficiently large team to support the current growth rate of the Group.

1.3 The Group may not be able to locate, secure and execute new opportunities for land acquisition, which are crucial for the implementation of the Group´s growth strategy

VGP´s growth up to date has been based on the ability to acquire appropriate land plots in strategic locations with sufficient size and other characteristics to allow for the development of the logistic and semi-industrial buildings. Currently, these are mainly old industrial brownfields. Such land plots remain scarce and competition for their acquisition is fierce. If the Group is not able to continue its track record of acquiring strategic land plots, it will have material adverse effect on the Group´s future growth and financial performance. As at 31 December 2023, the Group has a remaining development land bank in full ownership of 5,930,000 m² which allows the Group to develop ca. 3,575,000 m² of future lettable area. This includes the remaining 4,139,000 m² development land bank held by the Joint Ventures¹ with a development potential of circa 2,500,000 m² of new lettable area on which VGP has the development exclusivity. In addition, the Group has another 375,000 m² of committed land plots which allow for the development of ca. 280,000 m² of new projects. It is expected that these remaining land plots will be purchased during the next 12 to 24 months, subject to obtaining the necessary permits. The total owned and committed land bank (including Joint Ventures at 100%) for development is therefore 6,440,000 m² which represents a remaining development potential of ca. 6,355,000 m².

---

¹ On a Full Time Equivalents basis.
² Of which 35% is located in the Netherlands through the LPM Joint Venture.

PAGE 080 VGP NV ANNUAL REPORT 2023

2 Risks related to the Group’s business activities and industry

2.1 The Group’s development projects may experience delays and other difficulties, especially in respect of receiving necessary permits and increases in construction costs

The strategy of the Group is focused on the development of income generating logistic properties and on the potential disposal of such properties once they has reached a mature stage. Development projects tend to be subject to a variety of risks, each of which could cause late delivery of a project and, consequently, increase the development period leading up to its contemplated sale to or completion by the Joint Ventures, trigger a budget overrun, cause a loss or decrease of expected income from a project or even, in some cases, its actual termination. The Group adopts a “first mover” strategy in respect of securing or acquiring land plots on strategic locations without necessarily having already identified a specific future tenant. The Group typically contractually secures land plots to develop its projects prior to the granting of the required permits. The secured land plots are only acquired once the necessary permits have been obtained. The Group’s projects are therefore subject to the risk of changes in the relevant urban planning regulations and environmental, zoning and construction permits being obtained in a form consistent with the project plan and concept. The realisation of any project may, therefore, be adversely affected by (i) the failure to obtain, maintain or renew necessary permits, (ii) delays in obtaining, maintaining or renewing relevant permits and (iii) the failure to comply with the terms and conditions of the permits. Furthermore, a permit may be subject to an appeal by an interested party. Any such procedure could further delay the development and, ultimately, the sale of a project to or completion by the Joint Ventures and negatively impact the financial condition of the Group. Over the past 18 months, the Group has experienced a significant lengthening of the period required for receiving zoning permits. This is due to strong construction activity in all asset classes and local authorities which are unable to timely process all the permit requests. It can currently take between 18 to 24 months in order to receive the necessary permits. Other factors which may have an adverse effect on the development activities of the Group are, amongst others, unfamiliarity with local regulations, contract and labour disputes with construction contractors or subcontractors, accidents and natural hazards, construction and design defects, unforeseen site conditions which may require additional work and construction delays or destruction of projects during the construction phase (e.g. due to fire or flooding). We refer to Corporate Responsibility Report paragraph “ESG risks and opportunities” for further information.

VGP Park Hochheim, Germany

COMPANY REPORT 2023 PAGE 081

RISK FACTORS

In addition, when considering property development investments, the Group makes certain estimates as to the economic, market and other conditions, including estimates relating to the value or potential value of a property and the potential return on investment. These estimates may prove to be incorrect, rendering the Group’s strategy inappropriate with consequent negative effects on the Group’s business, results of operations, financial conditions and prospects. Finally, the Group is exposed to an increase in construction costs and organisational problems in the supply of the necessary raw materials or materials. In this respect, VGP is to a large extent subject to macro-economic developments, such as the volatility of raw material pricing (which is affected by the volatility in energy prices) – which after a period of significant increases has recently seen a declining trend (also on the back of recent decreasing energy prices) – and building materials and disruptions in the supply chain. Taking into account all the aforementioned risks, the Group may not be able to complete all of its development projects in the expected time frame or within the expected budgets. If any of the risks highlighted above materialise and adversely impact the successful development of the development projects, this could have a material adverse effect on the Group’s future business, financial condition, operating results and cash flows. Completion of plot acquisitions and conclusion of leases may also be subject to certain conditions, including public law approvals, waivers and consents. Plots acquired by the Group may be subject to delays in registration of transfers and other formalities. Plots may also be subject to rights and encumbrances, including easements, repurchase and pre-emptive rights in certain circumstances, special rights of use by third parties, protection orders and expropriation proceedings, as well as minor defects, remediation works and requirements to obtain use exemptions and permits, all of which could impact development, lease or transfer plans and result in unforeseen delays and costs for the Group. In addition, in certain cases, properties may be subject to complex division and transfer proceedings or the Group may only own a portion of a site. In these circumstances, the ability of the Group to develop, lease or transfer the property may be adversely affected, for example, if registration of the Group's ownership is delayed or if the Group does not have sufficient access or if the allocation of properties or rights is imprecise or subject to challenge.

2.2 The Group’s development projects require large initial investments and will only start to generate income after a period of time

During the first phase of the development of a new project, no income will be generated by the new development until such project is completed and delivered to a tenant. During such phase, the Group already makes significant investments in relation to the development of such project. The development phase of a VGP park typically takes between 18 to 24 months and depends on the size of the park and its development potential.# 2.2 Construction and Development Risks

Once the construction of a building is initiated, it takes about 16 to 20 months to complete, with longer periods applying to large (> 50,000 m²) and more complex buildings in terms of fit-out. The size of the park might also impact the timing of a future sale to the Second Joint Venture. The timing of a future sale to the Sixth Joint Venture also depends on the letting and development status of the income generating assets: a building needs to be 90% leased prior to such building being acquired by the Sixth Joint Venture. VGP retains the right to decide when to offer the park to the Sixth Joint Venture, but shall do so no later than upon completion of 90% of the lettable area of the respective park included in the development pipeline of the Sixth Joint Venture. Given the scale of the developments undertaken by the Third Joint Venture and the anticipated developments by the Development Joint Ventures, the buildings being constructed by these Joint Ventures will take between 18 to 24 months to complete, once the necessary permits are obtained. Any delay in the development of such projects or the lease thereof could have an adverse effect on the Group’s business, financial condition and results of operations. As at 31 December 2023, the Group had contractual obligations to develop new projects which were not yet rent income generating for a total amount of €273.3 million (compared to €371.7 million as at 31 December 2022). Any delay in the development of such projects or the lease thereof could have an adverse effect on the Group’s business, financial condition and results of operations.

2.3 The fair market value of the Property Portfolio might not be realised and is subject to competition

The Group’s revenues depend on the fair market value of its real estate projects. The results and cash flows of the Group may fluctuate significantly depending on the number of projects that can be developed and sold to the Joint Ventures and their respective fair market values. The own Property Portfolio, excluding development land but including the assets being developed on behalf of the Second Joint Venture and Fifth Joint Venture, is valued by a valuation expert at 31 December 2023 based on a weighted average yield of 4.11% (compared to 3.97% as at 31 December 2022) applied to the contractual rents increased by the estimated rental value of unlet space. A 0.10% variation of this market rate would give rise to a variation of the total portfolio value of €6.5 million. The markets in which the Group operates are also exposed to local and international competition. Competition among property developers and operators may result in, amongst others, increased costs for the acquisitions of land for development, increased costs for raw material, shortages of skilled contractors, oversupply of properties and/or saturation of certain market segments, reduced rental rates, decrease in property prices and a slowdown in the rate at which new property developments are approved, any of which could have a material adverse effect on the Group’s business, financial condition and results of operations.

2.4 The Group could experience a lower demand for logistic space due to fluctuating economic conditions in regional and global markets

The Group’s revenues depend to a large extent on the volume of development projects. Hence the results and cash flows of the Group may fluctuate significantly depending on the number of projects that can be developed and sold to the Second or Sixth Joint Ventures or developed by the Third Joint Venture and the Development Joint Ventures. The volume of the Group’s development projects depends largely on national and regional economic conditions and other events and occurrences that affect the markets in which the Group’s Property Portfolio and development activities are located. The Group is currently active in Germany, the Czech Republic, Spain, the Netherlands, Denmark, Slovakia, Hungary, Romania, Austria, Italy, Latvia, Portugal, Serbia, France and Croatia. A change in the general economic conditions of the countries where the Group is present or will be present in the near future could result in lower demand for logistics space, rising vacancy rates and higher risks of default by tenants and other counterparties. For further information on the potential impact of such changes on the Group’s portfolio, please refer to the sensitivity analysis included in notes 8, 9.1 and 17(v) of the 2023 Annual Report. The Group’s main country exposure is Germany, with 43% of the Group’s Property Portfolio 1 and projects under construction (own and Joint Ventures at 100% combined) located there as at 31 December 2023 (compared to 42% as at 31 December 2022).

2.5 The Group may lose key management and personnel or fail to attract and retain skilled personnel

The Group continues to depend to a large degree on the expertise and commercial qualities of its management, commercial and technical team and in particular on its Chief Executive Officer, Jan Van Geet. In particular, if Jan Van Geet, as Chief Executive Officer of the Group, would no longer devote sufficient time to the development of the portfolio of the Allianz Joint Ventures, Allianz can stop the acquisition process of income-generating assets (in relation to the Second Joint Venture) and/or suspend the delivery period (in relation to the Third Joint Venture) until he has been replaced to the satisfaction of Allianz. Similarly, if any person other than the Reference Shareholders gains control of the Group, this may constitute an event of default under certain of the Group's financing arrangements. Experienced technical, marketing and support personnel in the real estate development industry are in high demand and competition for their talent is intense. In order to attract and retain personnel, a long-term incentive plan is in place for selected VGP Group executives and key managers. Further details regarding the long-term incentive plan are available in the Group’s remuneration policy (Annex 8 of the Group’s corporate governance charter, as available on the Group’s website) as well as note 18 in the 2023 Annual Report and paragraph 5.4 Empowering our workforce of our Corporate Responsibility Report. The loss of services of any members of the management or failure to attract and retain sufficiently qualified personnel may have a material adverse effect on the Group’s business, financial condition, operating results and cash flows.

2.6 Risks and uncertainties linked to major events or business disruption

Unexpected global, regional or national events could result in severe adverse disruption to VGP Group, such as sustained asset value or revenue impairment, solvency or covenant stress, liquidity or business continuity challenges, in particular through the impact such events may have on the Group’s tenants. A global event or business disruption may include but is not limited to a financial crisis, health pandemic, civil unrest, war, act of terrorism, cyberattack or other IT disruption. Events may be singular or cumulative, and lead to acute/systemic issues in the business and/or operating environment. Given the fact that VGP Group has activities neither in Russia nor in Ukraine, the Group´s operations have not been materially directly affected by the war in Ukraine. The indirect effects resulting from volatility of energy and raw material prices and the increase in interest rates have been significant, as reflected elsewhere in this report. Should such price volatility return, it may again materially affect the Group´s operations. The Group is active in certain neighbouring countries (Slovakia, Latvia, Romania and Hungary), but the activities in these countries have not experienced significant specific negative effects due to the ongoing war in Ukraine to date. However, in case that the war continues or proliferates, it may impact the Group´s operation also directly. The war may also directly or indirectly affect the tenants of the Group and thereby also the Group´s financial performance. To date, however, no such material effects have been identified by the Group.

The current global and European sanction packages introduced in response to Russia´s aggression have also not had a direct effect on the Group, as it had no significant commercial relationships with companies subject to such sanctions. The Group has introduced policies required to ensure compliance with applicable sanctions and screening of commercial counterparties. Should, however, the sanction policy of the European Union be significantly extended, it may affect some of the suppliers or customers of the Group and thereby materially affect the financial position of the Group. Currently, the Group does not foresee such event taking place.

2.7 Risks related to natural hazards and other events

The Group manages a large portfolio of standing assets. Such assets may be subject to natural hazards or other events, such as fire, explosions, collapse, burglary. While the Group subscribes market standard insurance to cover against such events, which are in the Group´s view reasonable, such insurance policies are subject to limits and exclusions and may not cover all the damages that the Group or a Joint Venture may sustain as a result of such events. We refer to Corporate Responsibility Report paragraph “ESG risks and opportunities” for further information.# Risks related to the Group’s Joint Ventures

3.1 The Group’s business, operations and financial conditions are significantly affected by (i) the underlying operational, financial and organisational risks of the Joint Ventures and (ii) the continuation of the acquisition of completed assets from the Group

In order to enable the Group to continue to invest in its development pipeline whilst at the same time being adequately financed, the Group has currently entered into four (of which three still active) joint ventures with Allianz (the Allianz Joint Ventures), two joint ventures with Deka and Areim and three joint ventures with other partners (the Development Joint Ventures). The first two Allianz Joint Ventures (the First Joint Venture and the Second Joint Venture) are mainly focused on acquiring income generating assets which are being developed by the Group, knowing that the First Joint Venture has reached the holding stage, but has some equity reserved for remaining development land within the First Joint Venture. The Fourth Joint Venture has been terminated and was intended to replace the First Joint Venture. The third Allianz Joint Venture (the Third Joint Venture) relates to the development of VGP Park München. There is one building left to be developed. The Development Joint Ventures consist of (i) the joint venture with Roozen (the “LPM Joint Venture”), which relates to the development of VGP Park Moerdijk, which has been sold in February ’23 (ii) the joint venture with VUSA (the “VGP Park Belartza Joint Venture”), which relates to VGP Park Belartza and (iii) the joint venture with Revikon (the “VGP Park Siegen Joint Venture”), which relates to VGP Park Siegen.

These Joint Ventures allow the Group to recycle in part its initial invested capital when completed projects are acquired by the Second or Sixth Joint Venture or when buildings are completed by the Third Joint Venture or the Development Joint Ventures through refinancing of the invested capital by external bank debt and allow the Group to re-invest these monies in the continued expansion of the development pipeline, including the further expansion of the land bank, thus allowing the Group to concentrate on its core development activities. The Fifth Joint Venture still has to acquire three buildings, which are set to transfer in the course of ’24.

The Group may be significantly affected by the Joint Ventures, which are subject to additional risks such as:

• the Second Joint Venture and Sixth Joint Venture may discontinue acquiring the completed assets from the Group as these Joint Ventures have no contractual or legal binding obligation to acquire the income generating assets offered by the Group;
• the Group may be unable to develop assets complying with certain ESG performance metrics, which evolve over time and which may result in a reduced attractiveness of such assets offered to the Joint Ventures. Further insights in such ESG performance metrics can be found We refer to Corporate Responsibility Report paragraphs“ESG risks and opportunities” and “Group ESG Strategy” for further information;
• Allianz and VGP have an obligation to develop the remaining development asset of the Third Joint Venture; however, in case of material changes, Allianz can decide not to proceed with the completion of the development;
• the Fifth Joint Venture has an obligation to acquire the economic ownership of the three remaining assets in the course of ’24. In case of material deviations, this obligation may no longer be legally binding;
• the Group recognises the risk to which it is exposed in case of financial difficulties of any of the Joint Ventures, in particular in case of a default under a facility agreement; while the Group has no legal obligation to contribute additional capital to cure any such default, it has recognized, from a pragmatic point of view, a “constructive obligation” to ensure the financial stability of the Joint Ventures ;
• the sale of properties to the Second Joint Venture and Sixth Joint Venture could result in a decrease of the reported gross rental income of the Group as some of the sold properties may make a significant contribution to the income of the Group prior to their sale and their respective deconsolidation;
• Allianz and/or Areim may stop the acquisition process of proposed income-generating assets, and the Joint Venture Agreements may be amended or terminated in accordance with the provisions thereof;
• the Group may incur additional liabilities as a result of cost overrun on developments made on behalf of the Joint Ventures;
• the Group may be unable to provide funds to the Allianz Joint Venture which were previously committed under the terms of the relevant Allianz Joint Venture Agreement, which may result in the dilution of the Group;
• changes in consolidation rules and regulations may trigger a consolidation obligation at the level of Allianz which may result in the dilution of the Group;
• in case of a material breach by the Group, the Joint Venture Partner may terminate the Joint Venture Agreement for the respective Joint Venture and VGP may have to sell VGP shares in the Joint Venture at a discounted purchase price (or acquire the partner´s shares with a surcharge);
• in case the participation that Jan Van Geet holds in the Group would fall below 25%, Allianz can terminate the First, Second or the Third Joint Venture; and
• the Joint Ventures or any of their subsidiaries may be in default under the development and construction loans granted by the Group which may have a negative impact on the Group.

For example, the Fourth Joint Venture was scheduled to become effective at the moment of its first closing, which was initially expected to occur in November 2022. However, in view of the limited transparency on pricing of the seed portfolio and in the current volatile market environment, Allianz and VGP announced on 25 September 2022 that they were postponing the seed portfolio closing of the Fourth Joint Venture until such time both partners expect that a calmer environment will have returned. To this end Allianz has formally waived the exclusivity obligation in respect of the initial pipeline portfolio allowing VGP to sell the initial pipeline portfolio to one or multiple third parties, including through the establishment of a new alternative joint venture(s). As no transaction pursuant to the agreement on the establishment of the Fourth Joint Venture took place in 2023 and consequently two new Joint Ventures (the Fifth and Sixth) were established, the agreement on the establishment of the Fourth Joint Venture has been terminated.

The occurrence of any or all such risks could have a material adverse effect on the Joint Ventures’ business, financial condition and results of operations, which in turn could have a material adverse effect on the Group’s business, financial condition and results of operations. In addition, the Joint Ventures are exposed to many of the risks to which the Group is exposed, including amongst others the risks for the Group as described in the following sections: risk factor 3.3 “The Group may not be able to continue its development activities in a sustained and profitable way, for which it depends on its ability to execute new lease agreements and dispose of its real estate assets to the Joint Ventures” (but only in relation to the ability to execute new lease agreements, not the ability to dispose of assets), risk factor 2.4 “The Group’s development projects may experience delays and other difficulties, especially in respect of receiving necessary permits and increases in construction costs” and risk factor 2.5 “The Group could experience a lower demand for logistics space due to fluctuating economic conditions in regional and global markets”, all as in this section Risk Factors.

3.2 The Group is a holding company with no operating income and is dependent on distributions made by, and the financial performance of, the Joint Ventures and the members of the Group

The Group is a holding company of which the sole activity is the holding, financing and management of its assets, i.e. its participations in the Subsidiaries and in the Joint Ventures. The real estate portfolios of the Group are owned through specific asset companies which are subsidiaries of the Group or which are subsidiaries of the Joint Ventures. Accordingly, the Group depends on the cash flows from the members of the Group, proceeds for the disposal of the Group´s assets to the Joint Ventures and the distributions paid to it by members of the Group or the Joint Ventures. The ability of the Subsidiaries and the Joint Ventures to make distributions to the Group depends on the rental income generated by their respective portfolios. The Joint Ventures generated €15.7 million in management fee income for the year ending 31 December 2023, compared to €12.5 million for the year ending 31 December 2022. Profit distributions by the Joint Ventures for the period ending 31 December 2023 amounted to €20 million (compared to €30 million for the year ending 31 December 2022).

The financing arrangements of the Joint Ventures and the Subsidiaries are subject to a number of covenants and restrictions which could restrict the ability to upstream cash to the Group. The bank facilities require the Joint Ventures and the Subsidiaries to maintain specified financial ratios and meet specific financial tests.# Risks related to the Group’s financial situation

4.1 The Group’s debt levels have substantially increased over the last years and the Group is exposed to a (re)financing risk

In view of the geographic expansion, accelerated growth of the Group and more generally, the sustained growth of the demand for logistics warehouse space, the Group has incurred significant borrowings in recent years. VGP expects that debt levels in (nominal terms) will continue to increase but is convinced that it will be able to execute its growth strategy within a Gearing Ratio of 35%. VGP is continuously optimising its capital structure with an aim to maximise shareholder value while keeping the desired flexibility to support its growth.

Between 2020 and 2021, VGP successfully completed four share placements resulting in a net increase of the Group’s equity with €777.5 million resulting in the issuance of 7,960,111 of new shares. In 2020, VGP successfully completed two share placements resulting in a net increase of the Group’s equity with €175.8 million. In November 2021, VGP successfully completed share placement resulting in a net increase of the Group’s equity with €178.5 million. In November 2022 successfully completed another share placement, through a rights issue, resulting in a net increase of the Group’s equity with €175.3 million.

As at 31 December 2023, the net debt of the Group amounted to €3,883.3 million (compared to €3,990.5 million as at 31 December 2022). The Gearing Ratio was 33.6% (compared to 38.8% as at 31 December 2022).

As at 31 December 2023, the Group had bonds outstanding for a total amount of €3,568 million¹ (all being unsecured bonds) and had a remaining financial debt of €315.0 million², of which €120.7 million related to Schuldschein Loans and €66.0 million related to accrued interest.

The weighted average maturity of the debt stands at 4.7 years as at 31 December 2023, with a weighted average interest rate of 4.7% per annum.

Please also refer to the maturity profile financial debt which can be found in section “Business Review: Capital and financial position”

Considering the model of the Joint Ventures, additional short-term bank debt might occasionally be needed to cover temporary cash shortfalls due to timing of recycling of development shareholder loans granted to the Joint Ventures or to the subsidiaries developing the Group´s properties. These shareholder loans are repaid when projects are acquired by the Second, Fifth or Sixth Joint Venture or when adequate bank credit facilities (or accumulated operating cash flows) are available to allow partial refinancing of invested equity in respect of the Third Joint Venture or the Development Joint Ventures.

The Group is currently constructing a considerable amount of assets and has a number of large developments which have recently been or will shortly be initiated and which will require some time before being sold to the Second or Sixth Joint Venture or being eligible for refinancing through bank debt in respect of the Third, Fifth or the Development Joint Ventures. As a result, higher peak funding needs may arise between the various Joint Venture closings. In order to allow the Group to comfortably bridge these periods the Group has arranged additional revolving credit facilities. For a detailed overview of the evolution of the Group’s current financing arrangements, please refer to section “Business Review: Capital and financial position”.

Given its accelerated growth strategy, the Group may not be able to refinance its financial debt or may be unable to attract new financing or to negotiate and enter into new financing agreements on terms which are commercially desirable. If the Group is unable to receive financing at all or at favourable terms, this may have an impact on the Group’s cash flow and results and, thus, the Group may be unable to proceed with or to execute certain developments and may have to delay the initiation of certain projects.

4.2 The Group is exposed to risk of (re)financing from its Joint Ventures

VGP depends on the ability of each of the Joint Ventures to have sufficient long-term financing in place to allow the Second Joint Venture and Sixth Joint Venture to acquire income generating assets developed by VGP and to allow the Third Joint Venture and the Development Joint Ventures to refinance the development costs incurred when developing the respective parks of these Joint Ventures. The funding required for the re-financing of the assets developed by the Group on behalf of the Fifth Joint Venture is committed subject to appropriate conditions.

The First Joint Venture has 7-year committed credit facilities (all maturing at the end of May 2027), in Germany, the Czech Republic, the Slovak Republic and Hungary. As at 31 December 2023, the aggregate outstanding credit facilities amounted to €703.6 million which were fully drawn. The investment period of the First Joint Venture has ended in May 2023. The Loan to Value Ratio stood at 55.7% as at 31 December 2023.

The Second Joint Venture has a 7-year €805 million committed credit facility (maturing at the end of July 2027), in respect of the assets to be acquired in Spain, Austria, Italy and the Netherlands and a 7-year €186.5 million committed credit facility (maturing in June 2027) in respect of the assets to be acquired in Romania. As at 31 December 2023, the aggregate outstanding credit facilities were fully drawn and have an outstanding balance of €917.2 million. The Loan to Value Ratio stood at 51.5% as at 31 December 2023.

The Third Joint Venture drew a €35.5 million committed credit facility (maturing on 11 June 2027) in respect of the financing of the first two completed buildings in VGP Park München during 2020. As at 31 December 2023, additional bank financing in an amount of €28.4 million is available to re-finance the buildings which were completed in December 2022. It is currently expected that this credit facility will be fully drawn during 2024.

The Fifth Joint Venture, which executed its first closing in 2020, has a committed credit facility of €560 million maturing at 31 August 2030. These facilities are drawn for €137.9 million at 31 December 2023. Its planned that the remainder will be fully drawn in ’24. The Loan to Value Ratio stood at 22.5% as at 31 December 2023.

Finally, as at 31 December 2023, no bank debt or credit facilities were outstanding in respect of the Sixth Joint Venture and the Development Joint Ventures.

The Joint Ventures may not be able to refinance their financial debt or may be unable to attract new financing or to negotiate and enter into new financing agreements on terms which are commercially desirable. If the Joint Ventures are unable to receive financing at all or at favourable terms, which in turn may have an impact on the Group’s cash flow and results. In such circumstances, the Group may be unable to proceed with or to execute certain developments and may have to delay the initiation of certain projects.

4.3 The Group’s borrowings are subject to certain restrictive covenants

Under the terms of the bonds, Schuldschein Loans and bank credit facilities, the Group needs to ensure that it complies at all times with the respective covenants set forth therein. Failing to do so will result in the Group being in default under several (if not all) of the outstanding bonds, Schuldschein Loans and/or bank credit facilities. This may lead to an obligation of the Group to repay in full all outstanding financial indebtedness thereunder, which might have a material adverse effect on the Group’s business, financial condition, operating results and cash flows.

While the Group monitors its covenants on an on-going basis in order to ensure compliance and to identify any potential problems of non-compliance for action, there can be no assurances that the Group will at all times be able to comply with these covenants. During 2023, the Group remained well within its covenants.

---

¹ Including €16.3 million of capitalised finance costs.
² Including €0.8 million of capitalised finance costs.# The terms and conditions of the the Jul-Bond, the Mar-Bond, the Mar-Bond, the Apr-Bond, the Jan-Bond, the Jan-Bond and the Schuldschein Loans all have the same financial covenants.
As at 31 December 2023, the Consolidated Gearing stood at 24.5% (compared to 28.3% as at 31 December 2022) against a maximum covenant ratio of 35%. The Interest Cover Ratio was 7.2 as at 31 December 2023 compared to 7.3 as at 31 December 2022) against a minimum covenant ratio of 1.25. The Debt Service Cover Ratio was 1.76 as at 31 December 2023 (compared to 18.75 as at 31 December 2022) against a minimum covenant ratio of 1.25.
¹ Calculated by reference to the terms and conditions of the bonds and Schuldschein Loan documentation.

4.4 The Company’s's public financial rating may be suspended, reduced or withdrawn

The Group has a public financial rating determined by an independent rating agency. On 17 March 2021, Fitch gave the Company a long-term investment grade rating of ‘BBB-’ (stable outlook). This rating was affirmed by Fitch on 27 September 2021 and on 28 September 2022, however, it may be suspended, reduced or withdrawn at any time.
Following the announcement of the postponement of the initial closing of the Fourth Joint Venture through a press release by the Group dated 27 September 2022, Fitch issued a press release on 2 October 2022, in which it reaffirmed the Company’s credit rating of ‘BBB-‘ on 3 October 2022, commenting that it considered the postponement of the seed portfolio closing of the Fourth Joint Venture as a market induced pause, not a cessation of transfers to the Joint Ventures.
A rating downgrade would have a direct effect on the Group's cost of financing. A rating downgrade could also have an indirect effect on the appetite of credit providers to deal with the Company or an indirect effect on its financing cost or on its ability to finance its growth and activities. If the Group is unable to receive financing or financing against favourable terms, this may have an impact on the Company’s cash flow and results and, thus, the Group may be unable to proceed with or to execute certain developments and may have to delay the initiation of certain projects.

5 Legal and regulatory risks

5.1 The Group has to comply with a broad and diverse regulatory framework

As the Group is active and intends to further develop business in the mid-European countries (whereby the Group’s current focus is on Germany, the Czech Republic, Spain, the Netherlands, Slovakia, Hungary, Romania, Austria, Italy, Latvia, Portugal, Serbia, France, Croatia and Denmark), the Group is subject to a wide range of EU, national and local laws and regulations. These include requirements in terms of building and occupancy permits (which must be obtained in order for projects to be developed and let), as well as zoning, health and safety, environmental, monument protection, tax, planning, foreign ownership limitations and other laws and regulations.
Because of the complexities involved in procuring and maintaining numerous licenses and permits, there can be no assurance that the Group will at all times be in compliance with all of the requirements imposed on properties and the Group’s business. Any failure to, or delay in, complying with applicable laws and regulations or failure to obtain and maintain the requisite approvals and permits could have a material adverse effect on the Group’s business, results of operations, financial condition and prospects. In this respect, please also refer to risk factor 1.14 “The Group’s development projects may experience delays and other difficulties, especially in respect of receiving necessary permits and increases in construction costs”.
Furthermore, changes in laws and governmental regulations, or their interpretation by agencies or the courts, could occur. Such regulatory changes and other economic and political factors, including civil unrest, governmental changes and restrictions on the ability to transfer capital in the foreign countries in which the Group has invested, could have a materially adverse effect on the Group’s business, financial condition, operating results and cash flows.

COMPANY REPORT 2023 PAGE 087 RISK FACTORS

5.2 The Group may be subject to litigation and other disputes

The Group may face contractual disputes which may or may not lead to legal proceedings as the result of a wide range of events, especially during the construction and development phase. The most likely disputes include: (i) actual or alleged deficiencies in its execution of construction projects (including relating to the design, installation or repair of works); (ii) defects in the building materials; and (iii) deficiencies in the goods and services provided by suppliers, contractors, and sub-contractors.
In addition, after the development phase, the Group may become subject to disputes with tenants, commercial contractors or other parties in relation to the leasing, for example, in ensuring such parties comply with obligations, regulations and restrictions to which the Group may be subject. As a result, disputes, accidents, injuries or damages at or relating to one of the Group’s ongoing or completed projects resulting from the Group’s actual or alleged deficient actions could result in significant liability, warranty or other civil and criminal claims, as well as reputational harm. These liabilities may not be insurable or could exceed the Group’s insurance coverage limit.
At the 31 December 2023, no governmental, legal or arbitration proceedings have been started or are threatened against the Group which may have, or have had in the recent past, material adverse effects on the Group and/or the Group’s financial position or profitability.

6 Environmental, sustainability and climate change risks

6.1 The Group is subject to certain transitional climate risks and may not be able to meet all ESG related requirements or expectations of investors in this regard

Considering the size of its own and joint ventures’ asset portfolios, VGP places sustainability risks at the heart of its strategy with an integrated commitment to make sustainability a core part of the VGP business. The Group has developed a sustainability strategy based on environmental best practices, social fairness and transparent governance. VGP’s ESG Strategy (for more information please refer to section Group ESG Strategy in the Corporate Responsibility Report) aims to address the main challenges faced by the Group with its operational activities in all geographies.
As a developer and operator of semi-industrial and logistics assets, VGP has identified a broad range of sustainability risks and opportunities which are related to several departments and activities within the business such as energy efficiency/ transition, asset resilience to climate change, evolving taxonomy and environmental regulations, supply chain due diligence, green financing and societal risks– all of which are integrated into the Group’s risk management framework.
The ESG Risks– which are further discussed in section ESG risks and opportunities of the Corporate Responsibility Report– are categorised in seven categories: (i) ESG commitments, (ii) business ethics, (iii) Health, safety and well-being of people in our properties, (iv) human capital, (v) local municipal anchoring, (vi) protect environment and (vii) responsible supply chain.
Sustainability risks are long term risks, leading to direct or indirect impacts on VGP: (a) Direct impacts: change in weather patterns impacting our assets, energy efficiency regulations being implemented in our countries of operations, etc.; and (b) Indirect impacts: municipalities requiring high level of environmental performance in our development projects, regulations impacting our upstream supply chain and the cost of raw materials and energy (e.g. increased price of carbon emissions for energy producers and large emitters such as cement manufacturers and steel manufacturers), financial institutions integrating ESG risks in their portfolio management strategies, etc.

VGP Park Göttingen, Germany PAGE 088 VGP NV ANNUAL REPORT 2023 REPORT OF THE BOARD OF DIRECTORS

SUMMARY OF THE ACCOUNTS AND COMMENTS COMPANY REPORT 2023 PAGE 089

SUMMARY OF THE ACCOUNTS AND COMMENTS

Consolidated Income Statement

For the year ended 31 December

Income Statement (in thousand of €)	31.12.2023	31.12.2022
Revenue ¹	113,723	84,784
Gross rental and renewable energy income	69,003	51,230
Net property operating expenses	(5,534)	(8,223)
Net rental and renewable energy income	63,469	43,007
Joint venture management fee income	26,925	21,537
Net valuation gains / (losses) on investment properties ²	87,958	(97,230)
Administration expenses	(48,863)	(33,956)
Share in result of Joint Ventures	(10,715)	(45,927)
Other expenses	—	(3,000)
Operating result	118,774	(115,569)
Financial income	34,076	17,329
Financial expenses	(40,107)	(44,337)
Net financial result	(6,031)	(27,008)
Result before taxes	112,743	(142,577)
Taxes	(25,451)	20,035
Result for the period	87,292	(122,542)
Attributable to:
Shareholders of VGP NV	87,292	(122,542)
Non-controlling interests	—	—

¹ Revenue is composed of gross rental and renewables income, service charge income, property and facility management income and property development income.
² Includes realized gains on disposals of subsidiaries of € 15 million in ’22 and € 30.1 million in ‘21.

Earnings Per Share ³ (in €)	31.12.2023	31.12.2022
Basic earnings per share	3.20	(5.49)
Diluted earnings per share	3.20	(5.49)

³ Calculated based on the weighted average number of shares amounting to 27,317,847 shares as at 31 December 2022.The total issued shares at year-end 2023 and for the full year 2023 were 29,746,241 shares.

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VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Net rental income

The net rental income of VGP’s own portfolio, increased to €357.89 million for the full year 2023 compared to €305.44 million for the full year 2022 primarily due to full impact of income generating assets delivered during 2022 and 2023. During the year €411.73 million of annualized rental income including the Joint Ventures at 80%, have been activated. Another €409.57 million is still to be activated (upon delivery of assets), of which €407.59 million is expected to become cash generative in the next twelve months. Including VGP’s share of the joint ventures on a “look-through” basis net rental income increased by €120 million, or 25% compared to full year 2022 (from €402.88 million for the period ending 31 December 2022 to €417.88 million for the period ending 31 December 2023).

Net renewable energy income

• The gross renewable energy income over 2023 was €18.69 million compared to €15.94 million over FY2022. This was driven by an increase of 75.1% in the effective production sold in FY 2023 to 22 GWh, at a lower average energy price of €85/MWh (vs €162/MWh in 2022).
• The operational solar capacity increased significantly to 303.7 MWp, up 70% year-over-year which should equate to a marketable production potential of circa 45 GWh.
• As of January 2024, the Group possesses a licence to use the grid and trade energy on behalf of our tenants in Germany, which will facilitate distribution of produced renewable energy across our German parks. The Group has applied for a similar licence in Romania.
• As of December 2023 a total of 51 projects representing 42.0 MWp are under construction (of which circa half is expected to go into production during first 8 months of 2024 pending grid connection approval).
• Including projects under construction the total solar power generation capacity will increase to 345.7 MWp spread over 113 roof-projects in eight countries. As at the 31st of December 2023 this represents a total aggregate investment amount of €1050 million (incl. current commitments for projects under construction).
• With regards to the pipeline, an additional 46 solar power projects are in contractual/design phase (including in five additional countries) which equates to an added power generation capacity of 47.5 MWp. The current total solar portfolio, including pipeline projects, totals 120.7 MWp and is well underway towards the 200 MWp target by 2025.

Income from joint ventures

The joint venture management fee income increased by €15.28 million to €17.93 million. The increase was mainly due to the growth of the joint ventures’ portfolio, following an annualized effect of the transactions in ’22 and the transactions effectuated in ’23. As part of the joint venture management fee, the property and facility management fee income increased from €30 million for the period ending 31 December 2022 to €111.53 million for the period ending 31 December 2023 and the development management fee income during the period amounted to €18.83 million, an increase of €9.57 million in comparison to the period ending 31 December 2022.

¹ Of which €188.73 million on the own portfolio
² See attached section ‘Supplementary notes’ for further details
³ Includes 18 MWp of third-party owned systems

Lease activation (in € million)

	Dec '22 Net activated	FY '23 Signed leases to be activated	FY '23 committed annualized rental income	Dec '23 Net activated rental income
Total	238.2	72.7	304.3	350.8
Own portfolio	€ 165.6 million	66.1	€ 80.8 million	€ 223.4 million
JV portfolio	€ 46.5 million		€ 223.4 million	€ 125.6 million

COMPANY REPORT 2023

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SUMMARY OF THE ACCOUNTS AND COMMENTS

Net valuation gains on the property portfolio

As at 31 December 2023 the net valuation gains on the property portfolio reached €57.73 million compared to a net valuation loss of €51.17 million for the period ended 31 December 2022. The net valuation gain was mainly driven by: (i) €102.53 million unrealized valuation gain on the own and disposal group held for sale portfolio, and (ii) €55 million realized valuation gain on assets transferred as part of the first close with the Fifth Joint Venture, the fourth close with the Second Joint Venture and the tenth close with the First Joint Venture. All transactions in ’23 have been concluded at a premium value versus the property portfolio fair value as at 31 December 2022. The own property portfolio, excluding development land but including the buildings being constructed on behalf of the Joint Ventures, is valued by the valuation expert at 31 December 2023 based on a weighted average yield of 4.71% (compared to 5.17% as at 31 December 2022) applied to the contractual rents increased by the estimated rental value on unlet space. The real estate valuations were adversely impacted by the rising interest rate which resulted in increasing yields. However, VGP’s portfolio surpassed this effect by the impact on the valuations by rental growth, its development margin on newly constructed assets as well as realized gains on transactions with the Joint Ventures. Finally, the remaining assets earmarked for the Fifth Joint Venture and the seed portfolio for the Sixth Joint Venture have been aligned on the agreed fair market valuation, net of ancillary corrections as part of the purchase price calculation between both parties. The (re)valuation of the own portfolio was based on the appraisal report of the property expert IO Partners, preferred partner of Jones Lang LaSalle.

Administrative expenses

Administrative expenses increased with €17.58 million to €87.53 million, of which main variance is related to the LTIP program with an increase of €15.43 million, noting that in ’22 such provision was reversed with €8 million. As at 31 December 2023 the group employed 395.43 full-time equivalents, a decrease of 14.57 FTE versus ’22.

Share in net profit of the joint ventures

VGP’s share of the joint ventures’ loss for the period came in at €17.58 million from €15.94 million of loss for the period ending 31 December 2022, the increase is the result of higher net rental income as well as lower negative valuation adjustments on the Joint Venture portfolio. Net rental income at share of the Joint Ventures increased to €173.93 million for the period ending 31 December 2023 compared to €137.73 million for the period ended 31 December 2022. The increase reflects the underlying growth of the joint ventures’ portfolio net rental income resulting from organic rental growth as well as the different closings made with the First, Second and Fifth Joint Venture and the a full year effect of the deliveries and transactions of assets with the Joint Ventures in ’22. At 31 December 2023, the joint ventures (100% share) account for €1011.53 million of annualized committed leases representing 3,873,000 m² of lettable area compared to €756.53 million of annualized committed leases representing 1,759,000 m² at the end of December 2022. The net valuation losses on investment properties at share decreased from €103.91 million for the period ending 31 December 2022 to a loss of €37.14 million for the period ending 31 December 2023. The portfolio of the joint ventures, excluding development and the buildings being constructed by VGP on behalf of the Joint Ventures, was valued at a weighted average yield of 5.03% as at 31 December 2023 (compared to 5.97% as at 31 December 2022). The (re)valuation of the First, Second, Third and Fifth Joint Ventures’ portfolios was based on the appraisal report of the property expert IO Partners, preferred partner of Jones Lang LaSalle. The net financial expenses of the joint ventures at share for the period ending 31 December 2023 increased to €65.83 million (compared to 39.53 million as per 31 December 2022).

Other expenses

Other expenses included €16.43 million contribution to the UNHCR as per 31 December 2022. VGP has not made any contribution to its VGP Foundation in 2023.

Net financial result

For the period ending 31 December 2023, the financial income was €138.73 million (€175.63 million for the period ending 31 December 2022) driven by €135.53 million interest income on loans granted to the joint ventures (€175.63 million for the period ending 31 December 2022) and €3.20 million bank interest income from depositary accounts.

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VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

The reported financial expenses as at 31 December 2023 of €140.73 million (€148.53 million as at 31 December 2022) are mainly made up of €135.53 million expenses related to financial debt (€141.73 million as at 31 December 2022) and other financial expenses of €5.20 million (compared to €6.80 million as at 31 December 2022), partially offset by €25.43 million of capitalized interests (€26.73 million as at 31 December 2022). As a result, the net financial costs amounted to €2.00 million for the period ending 31 December 2023 compared to €21.00 million at the end of 2022. A bond of €150 million, carrying 1.375% interest, and a bond of €115 million, carrying 2.25% interest have been repaid in 2023. The average cost of the credit facilities currently amounts to 4.77% with an average term of 5.16 years.

Consolidated Balance Sheet

For the period ended 31st December

Assets (in thousand of €)

| | 31. 12. 2023 | 31. 12. |
| :-------- | :---------- | :------ |# COMPANY REPORT 2023 PAGE 093

SUMMARY OF THE ACCOUNTS AND COMMENTS

Balance sheet

	31. 12. 2023	31. 12. 2022
Non-current assets
Intangible assets	1,000	1,200
Investment properties	1,508,984	2,395,702
Property, plant and equipment	107,426	73,280
Investments in joint venture and associates	1,037,228	891,201
Other non-current receivables	565,734	359,644
Deferred tax assets	8,304	3,839
Total non-current assets	3,228,676	3,724,866
Current assets
Trade and other receivables	79,486	122,113
Cash and cash equivalents	209,921	699,168
Disposal group held for sale	892,621	299,906
Total current assets	1,182,028	1,121,187
Total Assets	4,410,704	4,846,053

Shareholders' Equity And Liabilities (in thousands of €)

	31. 12. 2023	31. 12. 2022
Shareholders' equity
Share capital	105,676	105,676
Share premium	845,579	845,579
Retained earnings	1,263,162	1,250,920
Shareholders’ equity	2,214,417	2,202,175
Non-current liabilities
Non-current financial debt	1,885,154	1,960,464
Other non-current liabilities	38,085	46,419
Deferred tax liabilities	23,939	79,671
Total non-current liabilities	1,947,178	2,086,554
Current liabilities
Current financial debt	111,750	413,704
Trade debts and other current liabilities	84,075	110,676
Liabilities related to disposal group held for sale	53,284	32,944
Total current liabilities	249,109	557,324
Total liabilities	2,196,287	2,643,878
Total Shareholders’ Equity And Liabilities	4,410,704	4,846,053

Investment properties

Investment properties relate to completed properties, projects under construction as well as land held for development. As at 31 December 2023 the investment property portfolio consists of 210 completed buildings representing 4,300,000 m² of lettable area with another 19 buildings under construction representing 338,000 m² of lettable area. During the year 18 buildings were completed totaling 303,000 m² of lettable area. For its own account VGP delivered 18 buildings representing 165,000 m² of lettable area. The Investment Property decreased to €2.4 billion, influenced by transactions executed in ‘23 and the reclassification of assets designated for the Sixth Joint Venture to assets held for sale. The own Investment Property portfolio, excluding development land is valued at an average weighted yield of 6%. The total capital expenditure (capex) on investment property, inclusive of assets held for sale, reached €275.24 million. This expenditure breakdown includes €178.63 million on assets, €77.44 million on acquisitions, and €19.17 million on interests and capitalized rent-free compo- nents. Including assets held for sale, the total investment property accounts for €1,450.00 million in completed assets, €258.73 million assets under construction, and €369.90 million land.

Property, plant and equipment

Property, plant and equipment increased with €42.84 million which mainly relates to investments in renewable energy assets (€34.73 million) and are accounted for at cost and depreciated over 20 years. Completed installations amount to €35.63 million, whereas €7.21 million refers to acquisition costs of renewable installations currently under construction. Photovoltaic capacity grew 95.5% YoY with operational capacity passing the 100 MWp-mark at 101.7 MWp (compared to 52.1 MWp in Dec-22). Photovoltaic projects under development amount to 37.0 MWp, with a further 77.5 MWp being planned.

Investment in joint ventures and associates

At the end of December 2023, the investments in the joint ventures and associates increased to €1,037.23 million from €891.20 million as at 31 December 2022. The investments in joint ventures and associates as at the end of 2023 reflect the Allianz Joint Ventures, the Deka Joint Ventures and the Development Joint Ventures, all of which are accounted for using the equity method. The increase is mainly related to equity contributions of transactions with Joint Ventures in amount of €139.30 million, a dividend from the First Joint Venture (€30.00 million) and an equity repayment from the development joint venture Grekon (€6.80 million), as well as share in the loss of the Joint Ventures of €11.90 million.

Disposal group held for sale

The balance of the Disposal group held for sale increased from €299.91 million as at 31 December 2022 to €892.62 million as at 31 December 2023. This balance relates to (i) the assets under construction and development land (at fair value) which are being / will be developed by VGP, on behalf of the First and Second Joint Venture, (ii) assets held for sale and related to upcoming closings in ‘24 with the Fifth Joint Venture as well as (iii) the assets and development land des- tined to the Sixth Joint Venture. The assets held for sale and destined to the Fifth and Sixth Joint Venture have been valued at the agreed fair market value, taking into account ancillary corrections and transaction costs, with the Joint Venture partners.

Total non-current and current financial debt

The financial debt decreased from €2,374.17 million as at 31 December 2022 to €1,996.90 million as at 31 December 2023. The decrease was mainly driven by the repayment of two bonds for a total amount of €535.00 million. VGP concluded on a credit facility of the European Investment Bank of €140.00 million to sup- port it’s renewable energy business unit in December ‘23. As per 1 February 2024, VGP has drawn €36.00 million of the facility at an interest rate of 4.77% on a ten year period. The gearing ratio of the Group as of 31 December 2023 amounted to 40.6% compared to 51.2% as at 31 December 2022.

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VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Cash flow statement

In thousands of €

	31. 12. 2023	31. 12. 2022
Cash flow from operating activities	(27,331)	(70,637)
Cash flow from investing activities	(8,078)	(566,150)
Cash flow from financing activities	(450,050)	1,116,401
Net increase/(decrease) in cash and cash equivalents	(485,459)	479,614

The changes in the cash flow from investing activities was mainly due to: (i) €377.00 million (2022: €754.70 million) of expenditure incurred for the development activities and land acquisition; (ii) €391.77 million cash recycled resulting from the fourth closing with the Second Joint Venture (€175.70 million), the tenth closing with the First Joint Venture (€135.50 million) (iii) the first clos- ing with the Fifth Joint Venture (€256.00 million) and some final settlements of previous closings (€14.50 million).

The changes in the cash flow from financing activities were driven by: (i) €85.00 million dividend paid out in May 2023 (2022: €140.00 million); (ii) €535.00 million repayment from the Apr-23 and Sep-23 Bonds.

Events after the balance sheet date

As per January ‘24, the group acquired its first site in Denmark, which is located in the northern part of the Triangle Region, a commercially important region in the centre of Denmark. On an area of more than 35,000 m² will be developed more than 70,000 m² of semi-industrial premises which are suitable for light industry and logistics services. The site is adjacent to the highway E45, exit 57 Vejle Syd. The park will offer full-scale services including photovoltaics, on-site electric car charging and high-quality technical and sustainable features.

As per February ‘24, the group divested its stake in the LPM Joint Venture for a consideration of ca €75.00 million.

VGP Park San Fernando de Henares, Spain

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VGP NV ANNUAL REPORT 2023

REPORT OF THE BOARD OF DIRECTORS

Information about the share

Listing of shares

Euronext Brussels

VGP share ISIN BE0003878957

Market capitalisation 31 Dec-23 2,865,587,760 €
Highest capitalisation 2,914,712,203 €
Lowest capitalisation 2,018,192,441 €

Share price 31 Dec-22 77.80 €
Share price 31 Dec-23 105 €

Shareholder structure

As at 31 December 2023 the share capital of VGP was represented by 27,291,312 shares. Ownership of the Company’s shares is as follows:

Shareholders	Number of shares	% of total shares	Number of voting rights²	% of total voting rights
Little Rock S.a.r.l.	8,092,390	29.65%	14,566,303	36.71%
Tomanvi SCA	629,714	2.31%	1,113,919	2.81%
Sub-total Jan Van Geet Group	8,722,104	31.96%	15,680,222	39.52%
VM Invest NV	5,186,463	19.00%	9,335,634	23.53%
Public	13,382,745	49.04%	14,661,163	36.95%
Total	27,291,312	100.00%	39,677,019	100.00%

Little Rock S.a.r.l. and Tomanvi SCA are companies controlled by Mr. Jan Van Geet. VM Invest NV is a company controlled by Mr. Bart Van Malderen.

The Extraordinary General Shareholders’ Meeting of 27 May 2010 approved the introduction of the double voting right. A double voting right is therefore granted to each VGP share that has been registered for at least two years without interruption under the name of the same shareholder in the register of shares in registered form, in accordance with the procedures detailed in article 12 of the Articles of Association. In accordance with Belgian law, dematerial- ised shares do not benefit from the double voting right. VGP has not issued any other class of shares, such as non-voting or preferential shares.

In accordance with Article 15 of the law of 2 May 2007 regarding the publication of major shareholdings (“transparency law”) VGP must publish, its (i) total share capital, (ii) the total num- ber of securities granting voting rights and (iii) the total number of voting rights, at the latest by the end of each month during which these numbers have increased or decreased.

³ As at 31 December 2023, on the basis of transparency declarations, information received from the shareholders or press releases issued by the Company in respect of Voting rights and denominator published on the Company’s website.

⁴ VGP NV has received a transparency notification dated 1 January 2024 that by virtue of the merger of Alsgard SA with Little Rock S.à.r.l. (formerly Little Rock SA) which occurred on 31 December 2023, that (i) Little Rock S.à r.l.# VGP NV COMPANY REPORT 2023 PAGE 097

INFORMATION ABOUT THE SHARE

Authorised capital

The Board of Directors has been authorized by the Extraordinary Shareholders’ Meeting held on 26 May 2017 to increase the Company's subscribed capital in one or more times by an aggregate maximum amount of € 320,567,414 (before any issue premium). The authority is valid for five years from 26 May 2017 and can be renewed in accordance with the applicable statutory provisions. Pursuant to this authorization, the Board of Directors may, among others, effect a capital increase under the authorized capital by means of issuing ordinary shares, subscription rights or convertible bonds and may limit or disapply the preferential subscription right of the Company's shareholders. Furthermore, the Board of Directors has been authorized, for a period of three years from 26 May 2017, to make use of the authorized capital upon receipt by the Company of a notice from the FSMA of a public takeover bid for the Company’s securities.

Liquidity of the shares

To improve the liquidity of its shares VGP NV concluded a liquidity agreement with KBC Bank. This agreement ensures that there is increased liquidity of the shares which should be to the benefit of the Group in the future as more liquidity allows new shares to be more easily issued in case of capital increases.

Financial calendar 2024

• first quarter trading update: 10 May 2024
• Annual shareholders’ meeting: 10 May 2024
• Ex-date dividend 2023: 22 May 2024
• Record date dividend 2023: 23 May 2024
• Payment date dividend 2023: 24 May 2024
• 2024 half year results: 23 August 2024
• 2024 third quarter trading update: 8 November 2024

VGP Park Nijmegen, The Netherlands COMPANY REPORT 2023 PAGE 099

OUTLOOK 2024

Outlook 2024

VGP believes to have set several milestones in 2023 that will enable solid growth in 2024 and beyond. The acquisition of some very iconic land plots, on top of already a prime land bank across the regions in which VGP operates, allows to offer attractive propositions to our clients. VGP expects to activate another €187.5 million of annualized rental income in 2024, supporting substantial growth in net rental income. The two new Joint Ventures will ensure continuous cash recycling to finance the development pipeline and will grow our joint venture asset management services further. A minimum of €560 million of gross cash proceeds are expected based on commitments from our new Joint Venture partners in the Fifth and Sixth Joint Venture. In 2023 VGP repaid €750 million of debts, but has only one bond of €500 million that comes to maturity in 2024. Moreover, VGP has come to an agreement in February 2024 to divest its LPM Joint Venture, which generated ca €400 million of cash proceeds. This brings the total minimum expected gross cash proceeds for 2024 already to €1,150 million, including the €100 million drawdown on the new credit facility of the European Investment Bank. This covers all outstanding commitments in our property and renewable energy developments, land acquisitions, debt repayments and dividend for 2024. As always, we look forward to updating you on our progress along the way.

VGP Park Giessen am Alten Flughafen, Germany PAGE 102

VGP NV ANNUAL REPORT 2023

BOARD OF DIRECTORS AND MANAGEMENT

Board of Directors

Composition on 31 December 2023

Name	Year appointed	Executive or non-executive	Independent	Next due for re-election
Chairman VM Invest NV represented by Bart Van Malderen	2021	Non-executive	reference shareholder	2025
CEO Jan Van Geet s.r.o. represented by Jan van Geet	2021	Executive	reference shareholder	2025
Directors Gaevan BV, represented by Ann Gaeremynck	2023	Non-executive	Independent	2027
Katherina Reiche	2023	Non-executive	Independent	2027
Vera Gäde Butzlaff	2023	Non-executive	Independent	2027

VGP Park Nijmegen, The Netherlands COMPANY REPORT 2023 PAGE 103

BOARD OF DIRECTORS

Bart Van Malderen

1968
Bart Van Malderen founded Drylock Technologies in 2013. Drylock Technologies is an hygienic disposable products manufacturer which introduced the revolutionary flufless diaper in 2016. Prior to this, Bart Van Malderen held different management positions at Ontex, a leading European manufacturer of hygienic disposable products where he became CEO in 1999 and Chairman of the Board in 2006, a mandate which he occupied until mid-July 2017.

Jan Van Geet

1970
Jan Van Geet is the founder and CEO of VGP. He has overall daily as well as strategic management responsibilities of the Group. He started in the Czech Republic in 1995 and was manager of Ontex in Turnov, a producer of hygienic disposables. Until 2015, he was also managing director of WDP Czech Republic.

Ann Gaeremynck

1971
Ann Gaeremynck is full professor of Accounting and Governance at the KU Leuven, Faculty of Economics and Business Administration. Since April 2018 she is member of the board and the audit committee of Retail Estates, a Belgian listed company which invests mainly in retail properties located in the periphery of residential areas or along access roads to urban centres. She currently is also a member of the board of directors and chair of the audit committee of Vives, a university college of the Association KU Leuven. In the past she fulfilled a position as an external member of the Audit Committee at the hospital AZ Delta.

Katherina Reiche

1973
Katherina Reiche is Chairwomen of the Management Board of Westenergie AG, Germany's leading energy infrastructure company, since 2020. Prior to this Katherina Reiche chaired the board of the Association of Municipal Enterprises (VKU) in Germany from 2015 to 2017 and chaired the European Association of Public Employers and Enterprises (CEEP) since June 2017. She was a member of the German Bundestag from 1994 to 2009. She served as State Secretary in the German Federal Ministry of Environment from 2009 to 2011 and as State Secretary in the Federal Ministry of Transport and Digital Infrastructure from 2011 to 2013. In 2020 she was appointed by the German federal cabinet as Chairwoman of the National Hydrogen Council.

Vera Gäde-Butzlaff

1962
Vera Gäde-Butzlaff is a member of several boards a.o. Supervisory board member Gröner Group AG, Chairwoman of the Bürgerstiftung Berlin and was a Supervisory board member of Berliner Volksbank until mid-2023. Prior to this Vera Gäde-Butzlaff was Deputy State Secretary for Environment and Agriculture at the Ministry of Regional Planning, Agriculture and Environment of Saxony-Anhalt from 1997 to 2001. From 2001 to 2015, she was a member of the Board of Directors and since 2006 CEO of Berlin’s city cleaning and waste management companies (BSR). From 2015 to 2017 she was CEO of GASAG AG, one of Germany’s largest regional energy suppliers. From 2017 to 2020, she has chaired the Supervisory Board of Vivantes, the hospital group.

PAGE 104 VGP NV ANNUAL REPORT 2023

BOARD OF DIRECTORS AND MANAGEMENT

Composition on 31 December 2023

Jan Van Geet	1	Chief Executive Officer
Piet Van Geet	2	Chief Financial Officer
Dirk Stoop	3	Company Secretary
Tomas Van Geet	4	Chief Commercial Officer
Miquel-David Martinez		Chief Technical Officer
Matthias Sander	5	Chief Operating Officer – Eastern Europe
Jonathan Watkins	6	Chief Operating Officer – Western Europe
Martijn Vlutters	7	Vice President – Business Development & Investor Relations

1 As permanent representative of Jan Van Geet s.r.o.
2 As permanent representative of Urraco BV as from 1 January 2017.
3 As permanent representative of Dirk Stoop BV as from 1 January 2017 until 30 June 2023.
4 As permanent representative of Tomas Van Geet s.r.o.
5 As permanent representative of Matthias Sander s.r.o.
6 As permanent representative of Havbo Consulting Ltd.
7 As permanent representative of MB Vlutters BV.

Executive Management Team

Mr. Piet Van Geet

1983
Joined VGP in 2011 and was appointed CFO in January 2017. He is responsible for all finance matters of the VGP Group. Prior to joining VGP, Piet Van Geet has been 7 years the CFO of Drylock Technologies, a leading disposable hygiene manufacturer with operations in Europe, Russia, USA and Brazil. After his studies he joined VGP as a project manager in the Baltics and Romania and continued his career at VGD in auditing and finance consulting prior to joining Drylock Technologies. Piet holds degrees at the University of Antwerp of Applied economical sciences and a Master of Tax law and holds a number of board seats, amongst other as chairman of Truncus Wealth.

Mr. Dirk Stoop

1971
Joined VGP in 1998 and held the position of CFO until January 2017 whereafter he was appointed Company Secretary. Prior to joining VGP Dirk worked at Ontex for 5 years as Group Treasurer where he was also responsible for tax and insurance matters. Prior to this he worked at CHEP Europe based in London as Treasurer Europe, South America & Asia. Dirk holds a Master’s Degree in Financial and Commercial Sciences from VLEKHO (HUB) in Belgium. Dirk Stoop left VGP as of 1 July 2023.

Mr. Tomas Van Geet

1980
Joined VGP in 2005. He takes responsibility for all commercial strategic matters and commercial co-ordination of VGP’s key accounts. Prior to joining VGP, Tomas held several positions in the planning and logistics departments of Domo in Germany, Spain, Czech Republic and South Africa, Associated Weavers and Ontex.

Mr. Miquel-David Martinez

1976
He is civil engineer and joined VGP’s team in 2014. He took responsibility for technical concepts and contract execution and has been appointed as technical director for Western Europe in 2016. Prior to this position, Miquel-David was the technical director and partner in Inel Group, a construction management and engineering company mainly focused on building projects for the tertiary sector.

COMPANY REPORT 2023 PAGE 105

EXECUTIVE MANAGEMENT TEAM

• Mr. Piet Van Geet
• Mr. Dirk Stoop
• Mr. Tomas Van Geet
• Mr. Miquel-David Martinez# Corporate Responsibility Report 2023

Introduction

Matthias Sander

* He is a mechanical and economic bachelor and joined VGP in . He takes responsibility for the expansion into new countries, sourcing land plots across Europe and coordinating of the development pipeline. Matthias spent the last  years in several leading roles with Knorr Bremse (a leading German industrial Group) and was its Managing Director in the Czech Republic.

Mr. Jonathan Watkins

* Joined VGP in December . Mr Watkins was previously head of UK and German Ops Real Estate at Amazon. Prior to this he held several leading roles in acquisition and construction of new stores and warehouses at Lidl Denmark, UK and Germany. Jon holds a Master’s Degree, Surveying of the University College of Estate Management and a BSc Surveying from Sheffield Hallam University.

Mr. Martijn Vlutters

* Joined VGP in . He takes responsibility for business development and investor relations. Prior to joining VGP, Martijn worked  years at J.P. Morgan based in London and New York in various roles in Capital Markets and Corporate Finance. Within this period, he spent  years in New York as Investor Relations for J.P. Morgan Chase. Martijn holds a Master degree in Civil Engineering from Delft University and Business Administration from Erasmus/Rotterdam School of Management

Mr. Rolf Carls

* He is a civil engineer and joined VGP’s team in . He took responsibility for technical concepts, contract execution and for the transfer of expertise to the newly established national VGP companies. He has been appointed as technical director for Eastern Europe as of January . Prior to this position, Rolf Carls was Managing Director of an engineering and consulting company mainly focused on industrial projects for the automotive and chemical sectors.

The curriculum vitae of the members of the executive management (except for the CEO – cf. supra) may be summarised as follows:

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Corporate Responsibility Report 2023

PAGE 33

CONTENT

Section	Title	Page
1	Introduction	35
1.1	CEO letter: Charting a Sustainable Tomorrow — Our Year in Review	35
1.2	Summary of the Group’s ESG achievements	39
1.3	About this report	40
1.4	Company at a glance	41
2	Group ESG Strategy	43
2.1	ESG Strategy: Building Tomorrow Today Together	43
2.2	Governance of ESG	55
3	Green financing of the Group activities	69
3.1	EU Taxonomy	75
3.2	Green bonds	79
3.3	VGP External Review of Green Finance Reporting	83

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CORPORATE RESPONSIBILITY REPORT 2023

PAGE 34

CONTENT

Section	Title	Page
4	Commitments	107
4.1	Address Climate Change	107
4.2	Sustainable Properties	116
4.3	Improve eco-efficiency	122
4.4	Protect and improve biodiversity	128
4.5	Empowering our workforce	131
4.6	Sustainable Supply Chain Management	135
4.7	VGP in the community	138
4.8	VGP Foundation	151
5	Additional information	157
5.1	VGP Reporting methodology	157
5.2	Independent third-party’s ESG assurance report	157

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Corporate Directory

Introduction

VGP Park Nijmegen, The Netherlands

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Introduction

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VGP NV ANNUAL REPORT 2023

INTRODUCTION

1.1 CEO letter: Charting a Sustainable Tomorrow — Our Year in Review

Dear stakeholders,

Meeting our goals, and achieving measurable results, for climate and nature will require innovation, working together in partnerships across the value chain, engagement with communities and a science-based approach. Our ESG Strategy is based on our motto “Building Tomorrow Today Together” and is underpinned by a threefold ambition:

• We transform ourselves. By creating more sustainable assets and helping our tenants to shift to better sustainable operating habits.
• We empower our stakeholders. By mobilizing our ecosystem to collectively improve our model and share growth with our communities.
• We contribute to solving the challenges of our time. By supporting initiatives that are developing solutions to climate change, the need for enhanced circularity, protecting biodiversity and social progress.

Address climate change

Among our Group’s sustainability highlights for 2023 was our progress on the first pillar of our ESG strategy: address climate change. We reduced our GHG emissions intensity per employee by 21 percent since our base year 2020, and helped our tenants reduce or avoid emissions through our efforts to enhance our building’s eco-efficiency, as well as by enabling sustainable transport and the green energy transition. We also refined our embodied carbon reduction efforts, involving our supply chain, covering suppliers that account for nearly 90 percent of our procurement spending. Finally, our photovoltaic roll-out has continued with our renewable energy production surpassing the annual electricity consumption of our tenants once all our PV pipeline projects are completed.

This report contains many examples of how we are contributing to a low-carbon society and supporting the Paris Agreement’s target of limiting the rise in global temperatures to 1.5 degrees Celsius. One that stands out is a project in Germany, where we have been able to obtain a license to trade energy on the grid for our tenants which will help us distribute our solar power more effectively and thereby reduce annual carbon emissions by 7,300 tons, equivalent to taking 2,100 conventional cars off the road.

By taking a closer look at the case studies we have included throughout the report you will see how we are using technology to shrink VGP’s environmental footprint while working with our tenants and suppliers to reduce and avoid emissions across our value chain.

Circularity, biodiversity and social progress

While we are particularly proud of our progress on the first pillar of our 2023 ESG strategy, we also continued to advance on the other pillars: build Sustainable Properties which preserve resources, improve eco-efficiency of our existing buildings, supporting communities, promoting biodiversity, and creating a workplace culture of integrity and transparency along the extended value chain.

In 2023, we strengthened VGP’s circularity approach by defining a new key performance indicator (KPI) for new projects taking into account every stage of the building’s life cycle, from design to end-of-life. In the “Sustainable Properties” section, you can find more examples of how we are putting circularity into practice in our buildings and management processes and the interaction with our tenants.

One other important initiative was the launch of our enhanced green lease template, which we aim to include in all new leases signed and which provides a framework for transparency into the environmental impact of a building’s usage and ensures green electricity procurement.

The report’s section on protecting and improving biodiversity details the strides we have made toward our goals of enhancing biodiversity through preserving and enhancing natural ecosystems surrounding our projects. This includes education within the community and training to keep awareness high.

When it comes to social progress, we achieved many concrete gains, including increasing gender diversity across the organization as well as management, and enhancing our human rights in our suppliers due diligence process. At the same time, by setting up the VGP Academy we have established a platform designed to empower our employees with the knowledge and skills needed to drive innovation and sustainability within our organization.

Technical competence

Technical competence cannot solve all of the world’s challenges. But our experience at VGP shows that, with clear goals in mind, and engaged and motivated people with the right skills and expertise, we can develop and deploy solutions that will take us a long way toward creating a sustainable society.

I want to thank our people for their contributions to our sustainability goals and for the work they have done, not just as employees but also in a private capacity, to support the shift to a sustainable society. And I want to thank all our stakeholders for your collaboration, support and trust. Together, we are Building Tomorrow Today and thereby leading the way to a sustainable future.

Sincerely,

Jan Van Geet
CEO

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VGP Park München, Germany

PAGE 36

VGP NV ANNUAL REPORT 2023

INTRODUCTION

1.2 Summary of the Group’s ESG achievements

Area	Achievement
Address climate change	- 21% Scope 1 and 2 emissions intensity reduction since 2020 - 1.5°C Scope 1 and 2 climate strategy approval by SBTi - 9% Scope 3 - embodied carbon intensity reduction since 2020 - 12% Scope 3 - portfolio use intensity reduction since 2020
Sustainable buildings	- GRESB Developer score - 1.5°C CRREM pathway (including identified improvement measures) - Implemented Internal carbon reference pricing - 54.3% Circular economy – recycled waste from construction sites
Strengthen communities	- 3,050 Volunteering hours by VGP employees - 72 Charitable projects supported by VGP Foundation
Empowering our workforce	- 100% of employees offered to participate in community days - 1.0bps Increase in women in the Group - 73.7% Employees satisfied with Group training and VGP Academy +23.6 Net promoter score given by employees
Protect and improve biodiversity	- 706,000 m² Total size of biotopes created in or around VGP Parks - 5,020 Additional trees planted in 2023 in existing parks - 100% of projects started in 2023 with an ecology plan - 54.4% of projects with meaningful biodiversity stakes implemented a biodiversity action plan
Improve eco-efficiency	- 12.7% of green leases among total active leases - 175% Solar power generation (including pipeline) as % of tenant electricity

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VGP NV ANNUAL REPORT 2023

INTRODUCTION

1.3 About this report

This Corporate Responsibility Report outlines VGP’s approach to Environmental, Social, and Governance (ESG) matters and details our achievements in 2023. It is structured according to VGP’s ESG strategy and our reporting commitments. The report serves as a comprehensive overview of our sustainability performance and our contribution to a more sustainable future.

PAGE 38

VGP NV ANNUAL REPORT 2023

INTRODUCTION

1.4 Company at a glance

VGP is a leading pan-European logistics real estate developer and manager. We focus on developing and managing high-quality, sustainable logistics properties in strategic locations across Europe. Our business model is built on a long-term perspective, creating value for our stakeholders through development, management, and a focus on sustainability.

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2. Group ESG Strategy

2.1 ESG Strategy: Building Tomorrow Today Together

Our ESG strategy, guided by the motto “Building Tomorrow Today Together,” is a comprehensive framework designed to integrate sustainability into every aspect of our operations. It is underpinned by a threefold ambition:

• Transforming Ourselves: We are committed to creating more sustainable assets and empowering our tenants to adopt better sustainable operating habits. This involves innovative building designs, the use of sustainable materials, and the integration of renewable energy solutions.
• Empowering Our Stakeholders: We believe in the power of collaboration. We aim to mobilize our ecosystem—including employees, tenants, suppliers, and the wider community—to collectively improve our sustainable model and share growth.
• Contributing to Solving Global Challenges: We recognize our role in addressing pressing global issues such as climate change, the need for enhanced circularity, biodiversity protection, and social progress. We actively support initiatives that contribute to these solutions.

Our strategy is structured around key commitment areas, ensuring a holistic approach to sustainability:

Address Climate Change

We are dedicated to reducing our environmental footprint and contributing to a low-carbon economy. This includes:
* Reducing greenhouse gas (GHG) emissions across our operations (Scope 1, 2, and 3).
* Enhancing the eco-efficiency of our buildings.
* Promoting the use of renewable energy, including our extensive photovoltaic (PV) rollout.
* Engaging our supply chain to reduce embodied carbon.
* Aligning our climate targets with science-based initiatives, such as the Paris Agreement’s goal of limiting global temperature rise to 1.5 degrees Celsius.

Sustainable Properties

We are committed to developing and managing properties that are not only functional and strategically located but also environmentally responsible and resource-efficient. This involves:
* Designing buildings with longevity and adaptability in mind.
* Implementing circular economy principles throughout the building lifecycle, from design to end-of-life.
* Minimizing waste and maximizing the use of recycled materials.
* Ensuring that our properties contribute positively to their surrounding environment and communities.

Improve Eco-efficiency

We continuously seek to improve the environmental performance of our existing portfolio and new developments. Key initiatives include:
* Implementing green lease agreements that promote sustainable practices among tenants.
* Maximizing the generation and use of solar power.
* Reducing water consumption and improving waste management in our facilities.
* Utilizing smart building technologies to optimize energy and resource use.

Protect and Improve Biodiversity

We recognize the critical importance of biodiversity and are committed to protecting and enhancing natural ecosystems around our developments. Our approach includes:
* Preserving and creating natural habitats and green spaces within and around our VGP Parks.
* Planting native trees and vegetation to support local flora and fauna.
* Developing and implementing ecology plans for all new projects.
* Engaging in biodiversity action plans to ensure meaningful ecological benefits.
* Raising awareness and educating our stakeholders about the importance of biodiversity.

Empowering Our Workforce

Our people are central to our sustainability journey. We are committed to fostering a diverse, inclusive, and skilled workforce. This includes:
* Promoting diversity and inclusion across all levels of the organization.
* Providing extensive training and development opportunities, including the VGP Academy, to equip employees with the skills needed for innovation and sustainability.
* Encouraging employee engagement in community initiatives and sustainability efforts.
* Ensuring a safe and healthy working environment.
* Cultivating a culture of integrity, transparency, and ethical conduct.

Sustainable Supply Chain Management

We extend our sustainability commitments to our supply chain, recognizing that true impact requires collaboration with our partners. Our efforts focus on:
* Engaging suppliers to adopt sustainable practices and reduce their environmental impact.
* Assessing and managing social and environmental risks within our supply chain, including human rights due diligence.
* Promoting circularity and resource efficiency among our suppliers.
* Ensuring transparency and accountability throughout the supply chain.

VGP in the Community

We aim to be a positive force in the communities where we operate. Our community engagement initiatives include:
* Supporting local charitable projects and social causes.
* Encouraging employee volunteering and community involvement.
* Developing VGP Parks in a way that benefits local areas, such as through green spaces and local employment.

VGP Foundation

The VGP Foundation plays a crucial role in channeling our philanthropic efforts and supporting initiatives that align with our ESG strategy. It focuses on projects that promote environmental conservation, social well-being, and sustainable development.

2.2 Governance of ESG

Effective governance is essential for the successful implementation of our ESG strategy. VGP’s governance structure ensures that ESG considerations are integrated into our decision-making processes at all levels of the organization.

• Board Oversight: The Board of Directors holds ultimate responsibility for the company’s sustainability strategy and performance. ESG-related matters are regularly discussed at Board meetings, ensuring strategic alignment and oversight.
• Executive Management Responsibility: Executive management is responsible for the day-to-day implementation of the ESG strategy. Specific responsibilities are assigned to relevant executives, ensuring accountability and driving progress.
• ESG Committee/Working Groups: Dedicated committees or working groups are established to oversee specific ESG areas, such as climate change, circularity, or social impact. These groups bring together expertise from various departments to develop and implement initiatives.
• Risk Management: ESG risks are integrated into VGP’s enterprise-wide risk management framework. This ensures that potential environmental, social, and governance risks are identified, assessed, and mitigated proactively.
• Reporting and Transparency: We are committed to transparently reporting on our ESG performance. This report, along with our annual financial reports and other disclosures, provides stakeholders with comprehensive information on our progress and challenges.
• Stakeholder Engagement: Continuous dialogue with our stakeholders—including investors, employees, tenants, suppliers, and local communities—is vital for shaping our ESG strategy and ensuring it remains relevant and impactful.

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3. Green financing of the Group activities

3.1 EU Taxonomy

The EU Taxonomy Regulation is a classification system that establishes a list of environmentally sustainable economic activities. VGP is committed to aligning its operations with the principles of the EU Taxonomy, contributing to the EU’s climate and environmental objectives. We assess our assets and activities against the Taxonomy’s criteria, focusing on their substantial contribution to environmental objectives, no significant harm (NSH) to other environmental objectives, and compliance with minimum social safeguards. Our reporting under the EU Taxonomy provides transparency on the proportion of our revenues, capital expenditure, and operational expenditure that are aligned with environmentally sustainable activities.

3.2 Green bonds

VGP actively utilizes green bonds as a key instrument for financing its sustainable development activities. Green bonds allow us to raise capital specifically for projects that have positive environmental impacts, such as the development of energy-efficient logistics buildings, the installation of renewable energy systems, and the implementation of circular economy principles. By issuing green bonds, we not only secure funding for our sustainability initiatives but also signal our commitment to environmentally responsible investment to the financial markets. The use of proceeds from our green bonds is meticulously tracked and reported to ensure compliance with green bond principles and to provide assurance to our investors.

3.3 VGP External Review of Green Finance Reporting

VGP engages independent third parties to provide external assurance and review of its green finance reporting. This external verification process enhances the credibility and reliability of our disclosures related to green bonds and other green financing instruments. The review typically assesses the alignment of our green bond framework with recognized standards, the adherence to the use of proceeds, and the environmental impact reporting. This external validation underscores our commitment to transparency and accountability in our green finance practices, providing stakeholders with confidence in our sustainability commitments.

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4. Commitments

4.1 Address Climate Change

We are committed to significantly reducing our greenhouse gas (GHG) emissions and contributing to a global transition towards a low-carbon economy. Our strategy focuses on measurable reductions across Scope 1, 2, and 3 emissions, supported by science-based targets.

• GHG Emissions Intensity Reduction: We have achieved a 21% reduction in Scope 1 and 2 emissions intensity per employee since our base year of 2020. This demonstrates our ongoing efforts to improve operational efficiency and reduce our direct environmental impact.
• Science-Based Targets (SBTi): Our Scope 1 and 2 climate strategy has been approved by the Science Based Targets initiative (SBTi), aligning our ambitions with the Paris Agreement's goal of limiting global warming to 1.5 degrees Celsius.
• Embodied Carbon Reduction: We have reduced our Scope 3 embodied carbon intensity by 9% since 2020. This is a critical step in addressing the carbon footprint associated with the materials and construction processes of our buildings.
• Portfolio Use Intensity Reduction: Our Scope 3 portfolio use intensity has been reduced by 12% since 2020. This reflects improvements in the energy efficiency of our operational buildings and a greater adoption of sustainable practices by our tenants.
• Sustainable Building Certifications: Our portfolio continues to achieve high scores in sustainability assessments, such as the GRESB Developer score. We are also aligning with the 1.5°C CRREM pathway, incorporating identified improvement measures to ensure our buildings are future-proofed against climate risks.
• Internal Carbon Pricing: We have implemented an internal carbon reference pricing mechanism, which helps us to integrate the cost of carbon into our investment decisions and drive the adoption of lower-carbon solutions.
• Circular Economy in Construction: We are proud to report that 54.3% of waste from our construction sites is recycled, reflecting our commitment to circular economy principles and minimizing landfill waste.
• Renewable Energy Generation: Our extensive photovoltaic (PV) rollout is a cornerstone of our climate strategy. Our current and planned solar power generation is set to exceed the annual electricity consumption of our tenants, contributing significantly to a renewable energy transition.
• Case Study Example: A notable project in Germany has enabled us to obtain a license to trade energy on the grid for our tenants. This initiative will facilitate a more effective distribution of our solar power, leading to an estimated annual carbon emission reduction of 7,300 tons, equivalent to removing 2,100 conventional cars from the road.

4.2 Sustainable Properties

We are committed to developing and managing logistics properties that are environmentally responsible, resource-efficient, and contribute positively to their surroundings. Our approach integrates circular economy principles and aims to create durable, adaptable, and high-performing assets.

• Circular Economy Integration: We have defined a new key performance indicator (KPI) for new projects that considers every stage of the building’s life cycle, from design to end-of-life. This ensures that circularity is embedded in our development process.
• Sustainable Materials: We prioritize the use of sustainable, recycled, and recyclable materials in our construction projects, reducing waste and the demand for virgin resources.
• Energy Efficiency: Our buildings are designed and constructed to high energy efficiency standards, minimizing operational energy consumption and associated GHG emissions.
• Green Lease Templates: We have launched an enhanced green lease template, which we aim to include in all new leases. This provides a framework for transparency into the environmental impact of a building’s usage and ensures green electricity procurement by tenants.
• Adaptability and Longevity: We design properties with flexibility in mind, allowing for future adaptations and reconfigurations to meet evolving market needs, thereby extending the useful life of our assets.
• Biophilic Design: Where possible, we incorporate biophilic design elements, connecting occupants with nature and improving the overall well-being within our facilities.

4.3 Improve eco-efficiency

We continuously strive to enhance the environmental performance of both our new developments and our existing portfolio. Our eco-efficiency initiatives focus on optimizing resource use, reducing waste, and promoting sustainable operational practices.

• Green Leases: 12.7% of our total active leases are green leases. These agreements encourage tenants to adopt sustainable practices, such as energy and water conservation, and responsible waste management.
• Solar Power Generation: Our solar power generation, including our pipeline projects, accounts for 175% of our tenants' electricity consumption. This significant surplus demonstrates our commitment to renewable energy and our ability to generate more clean energy than is consumed by our tenants.
• Waste Management: We are committed to minimizing waste generated from our operations and construction sites. As noted in the climate change section, 54.3% of construction waste is recycled, and we continually seek opportunities to reduce, reuse, and recycle materials.
• Water Efficiency: We implement water-saving measures in our buildings and operations to reduce overall water consumption, particularly in water-scarce regions.
• Smart Building Technology: We leverage smart building technologies to monitor and optimize energy consumption, lighting, heating, and ventilation systems, leading to greater eco-efficiency.

4.4 Protect and improve biodiversity

We recognize the vital role of biodiversity and are committed to preserving and enhancing natural ecosystems within and around our VGP Parks. Our efforts aim to create net positive impacts on biodiversity.

• Total Biotopes Created: We have created a substantial 706,000 m² of biotopes in and around our VGP Parks. These areas are designed to support local flora and fauna, providing essential habitats.
• Tree Planting: In 2023 alone, we planted 5,020 additional trees in our existing parks. This contributes to increasing green cover, improving air quality, and supporting biodiversity.
• Ecology Plans: 100% of projects started in 2023 have an ecology plan in place. This ensures that biodiversity considerations are integrated from the initial design and planning stages.
• Biodiversity Action Plans: 54.4% of our projects have implemented a biodiversity action plan, detailing specific measures to protect and enhance local ecosystems. This demonstrates a proactive approach to biodiversity management.
• Habitat Restoration and Creation: We actively engage in projects to restore degraded habitats and create new ones, such as wildflower meadows, wetlands, and green corridors, to support a diverse range of species.
• Awareness and Education: We conduct educational programs and training sessions to raise awareness among our employees, tenants, and local communities about the importance of biodiversity and our conservation efforts.

4.5 Empowering our workforce

Our employees are the driving force behind our sustainability achievements. We are committed to fostering a diverse, inclusive, engaged, and skilled workforce that is equipped to drive innovation and sustainability.

• Community Day Participation: 100% of our employees were offered the opportunity to participate in community days, encouraging engagement in local social and environmental initiatives.
• Gender Diversity: We have achieved a 1.0 bps increase in the representation of women in the Group, reflecting our commitment to gender equality and diversity.
• Employee Satisfaction with Training: 73.7% of employees are satisfied with the Group’s training programs and the VGP Academy. This highlights the value and effectiveness of our investment in employee development.
• Net Promoter Score (NPS) from Employees: Our employees have given a Net Promoter Score of +23.6, indicating a high level of employee advocacy and satisfaction.
• VGP Academy: The VGP Academy serves as a central platform for continuous learning and development, equipping our employees with the knowledge and skills necessary to excel in their roles and contribute to our sustainability goals.
• Health and Safety: We prioritize the health, safety, and well-being of our employees, implementing robust safety protocols and promoting a culture of care.
• Inclusion and Diversity: We are committed to creating an inclusive work environment where all employees feel valued, respected, and empowered, regardless of their background.

4.6 Sustainable Supply Chain Management

We recognize that our sustainability impact extends beyond our direct operations to our supply chain. We are committed to working with our suppliers to promote responsible and sustainable practices throughout the value chain.

• Supplier Engagement: We actively engage with our suppliers to encourage their adoption of sustainable practices, including environmental management, social responsibility, and ethical conduct.
• Due Diligence: We conduct thorough due diligence on our suppliers, assessing potential social and environmental risks, including human rights considerations, to ensure compliance with our standards.
• Circular Economy Principles: We work with our suppliers to promote circular economy principles, such as the use of recycled materials, waste reduction, and product longevity, within their operations.
• Collaboration on Innovation: We collaborate with suppliers on innovative solutions that can reduce environmental impact, improve resource efficiency, and enhance the sustainability of our projects.
• Supplier Code of Conduct: We have established a Supplier Code of Conduct that outlines our expectations regarding ethical behavior, environmental protection, and social responsibility.

4.7 VGP in the community

VGP is committed to being a responsible corporate citizen and a positive contributor to the communities in which we operate. Our engagement aims to create shared value and foster long-term relationships.

• Local Investment and Employment: Our development projects create local employment opportunities and contribute to the economic vitality of the regions where we operate.
• Community Support: We support local charitable projects and initiatives that align with our ESG strategy, focusing on areas such as environmental conservation, education, and social well-being.
• Green Spaces and Public Amenities: Where feasible, our developments incorporate green spaces and public amenities that enhance the local environment and provide benefits to the community.
• Stakeholder Dialogue: We engage in open dialogue with local communities, authorities, and stakeholders to understand their needs and concerns, ensuring our developments are well-integrated and mutually beneficial.

4.8 VGP Foundation

The VGP Foundation serves as a dedicated vehicle for our philanthropic endeavors, amplifying our commitment to positive social and environmental impact.

• Strategic Philanthropy: The Foundation supports projects and initiatives that align with VGP's core ESG objectives, focusing on areas such as climate action, biodiversity conservation, education, and social development.
• Grantmaking and Partnerships: The Foundation provides grants to eligible organizations and collaborates with partners to implement impactful projects.
• Impact Measurement: We are committed to measuring and reporting on the impact of the projects supported by the VGP Foundation, ensuring accountability and demonstrating the value of our philanthropic investments.

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5. Additional Information

5.1 VGP Reporting methodology

Our reporting methodology for this Corporate Responsibility Report adheres to internationally recognized standards and frameworks. We aim for transparency and accuracy in our disclosures, drawing on data collected through our internal management systems and verified by relevant internal and external parties. Our methodology includes:

• Scope: This report covers the ESG performance of VGP NV and its subsidiaries for the fiscal year 2023, unless otherwise stated.
• Data Collection: Data is collected from various operational departments, financial systems, and human resources records. We employ robust data management practices to ensure the integrity and consistency of the information reported.
• Boundaries: We report on our direct operations (Scope 1 and 2) and our value chain emissions (Scope 3), including embodied carbon and portfolio use intensity. Specific reporting boundaries for each ESG topic are detailed within the respective sections.
• Assurance: Where applicable, our data and reporting are subject to external assurance by independent third parties, as detailed in Section 5.2.
• Alignment with Frameworks: Our reporting is guided by principles from frameworks such as the Global Reporting Initiative (GRI) Standards, the Task Force on Climate-related Financial Disclosures (TCFD), and the EU Taxonomy Regulation.

5.2 Independent third-party’s ESG assurance report

VGP is committed to the highest standards of transparency and accountability in its ESG reporting. To this end, we engage independent third-party assurance providers to review and verify key aspects of our sustainability data and disclosures. This external assurance process lends credibility to our reporting and provides stakeholders with confidence in the accuracy and reliability of our ESG performance.

The scope of the assurance typically covers:

• Verification of ESG Data: Independent assurance providers examine the data underpinning our key ESG metrics, including GHG emissions, waste recycling rates, and employee satisfaction.
• Review of Reporting Framework Alignment: Assurance is sought on our adherence to relevant reporting frameworks and standards.
• Assessment of ESG Strategy Implementation: The assurance process may also include an assessment of the implementation and effectiveness of our ESG strategy.

Details of any specific assurance engagements, including the scope and findings, are made available to stakeholders to ensure full transparency. This commitment to external assurance underscores our dedication to robust and credible ESG reporting.

***# VGP NV ANNUAL REPORT 2023

INTRODUCTION

2.1.1 Results of non-financial ratings and indices

Non-financial evaluations

The Group’s ESG assessments by extra-financial rating agencies were updated in 2023:

• GRESB: in 2023, with a score of 85/100 for its development activities, the Group received a “5 Star” rating and recognises VGP as the second highest performance in its European peer group. The score for Standing Investments improved year over year to a score of 88/100, equivalent to a “5 Star” rating.
• CDP (formerly the Carbon Disclosure Project): VGP was highlighted as a global leader on supplier engagement by global environmental impact non-profit CDP:
• Being awarded a position in the Supplier Engagement Leaderboard in 2023 with an A- ranking recognising the Group as a global leader for engaging with its suppliers on climate change (more details in section 3.4 Sustainable Supply chain management);
  • Score 2023 climate change: B
• Sustainalytics: VGP received an ESG Risk Rating of 11.1 and was assessed by Sustainalytics to be at “Negligible” risk of experiencing material financial impacts from ESG factors. VGP’s ESG Risk Rating by Sustainalytics places the Group at the 11th rank and in the 17th percentile of the Real Estate Industry group assessed by Sustainalytics, as well as at the 283rd rank in the global rated universe (20,000+ companies). VGP’s management score of ESG issues assessed by Sustainalytics is strong (86/100) (last update in February 2023).
• S&P’s ESG solutions: As of 26 March 2023, our company performed in the top decile in the Real Estate Management & Development Industry in the S&P Global Corporate Sustainability Assessment 2023. Our company scored 85 (out of 100), reflecting an improvement of 16 points over 2021, with full scores in the following criteria: 75 for Environmental, 85 for Social and 88 for Governance & Economic.

Non-financial indices

On 20 March 2023, VGP was included in the BEL® ESG Index (for more details please see Euronext’s website). The BEL® ESG Index is a free float market capitalisation weighted index that reflects the performance of the 20 companies with the best ESG risk rating selected among the best in their subindustry from the BEL 20 Index and BEL Mid Index.

CORPORATE RESPONSIBILITY REPORT 2023

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2.2 ABOUT THIS REPORT

VGP communicates regularly about how we manage and conduct our business. We share information about our ESG performance through a number of channels — including our Annual Report, various other reports and presentations, regulatory filings, press releases and direct conversations with stakeholders. We maintain a dedicated sustainability section on our website to facilitate access to information that we publish on these topics. This Annual Report is designed to consolidate and summarize our work on key topics that are important to our business and stakeholders, and guide readers to where they can access more detailed information about specific topics of interest.

All data in this report are as of Dec. 31, 2023, unless otherwise noted. For the CO2 emissions and energy consumption data of our tenants within our portfolio 2023 full-year data has been used (as referenced in the respective tables).

2.2.1 Alignment with ESG reporting standards and frameworks

VGP’s 2023 non-financial statement consists mainly of the present Chapter “Corporate Responsibility” of the Group’s 2023 Annual Report, completed with elements in Chapters “Profile”, “Strategy”, “the Report of the Board of Directors” and the “Remuneration Report”.

In 2023, in compliance with the anticipated EU “Taxonomy” regulation, VGP has published the share of its eligible and aligned activities. The EU Taxonomy aims to establish a unified classification system for economic activities to determine whether these activities can be considered “environmentally sustainable” (or “green”). The eligible and aligned share of turnover, CAPEX and OPEX from VGP activities are presented in section 2.3 EU Taxonomy regulation.

The 2023 VGP Annual Report also complies with the Best Practices Recommendations on Sustainability Reporting (“sBPR”) established by the European Public Real Estate Association (“EPRA”). VGP received the EPRA “Most improved” and “Bronze” Awards in 2022 for completing its 2021 reporting in accordance with the EPRA Sustainability BPR.

Since 2010, VGP follows the GRI guidelines. The 2023 Annual Report has been prepared in accordance with the GRI Standards: Core option.

The 2023 Group’s non-financial statement is also in line with the recommendations of the TCFD. VGP is an official supporter of the Financial Stability Board’s (“FSB”) TCFD since 2017, recognising the importance of increasing transparency of climate-related risks and opportunities, promoting more informed financial decision-making and building a more resilient financial system.

The following table includes cross-referencing between the information published by VGP in this document and the main (European and Global) reporting standards for non-financial information: the Non-Financial Reporting Directive, the GRI standards and TCFD recommendations. Complete cross-references tables of the Group’s 2023 sustainability reporting with EPRA and GRI frameworks, as well as with the TCFD’s core elements of climate-related financial disclosures, are available in the sustainability section of the Group’s website (https://www.vgpparks.eu/en/investors/environmental-disclosures/). Links between the UN SDGs and ESG risks and opportunities can be identified in the graphics included in section 3.1.3 ESG risks and opportunities.

Cross-reference table of the management report

Topic	Annual Report section	Description of the business model
	Page 20–23
Description of the principal non-financial risks relating to the Group’s business	Page 78–87
Description of the policies to identify, prevent and mitigate non-financial risks and their outcomes including key performance indicators	Page 78–87
Respect for human rights	Page 73
Anti-corruption measures	Page 73
Climate change (contribution and adjustments)	Page 87
Circular economy	Page 28
Waste	Page 174
Collective bargaining agreements and their impacts	Page 189
Measures taken to combat discrimination and promote diversity	Page 73
Societal commitments	Page 75

2.2.2 External assurance

In compliance with the applicable frameworks on the disclosure of non- financial information (see Section 2.2.1. Alignment with ESG reporting standards and frameworks), the Scope 1, Scope 2 and Scope 3 concerning tenant energy consumption data key performance indicators of the Group’s non-financial statement are audited by an independent third-party verifier; see the assurance report in Section 7.2 Independent third-party’s ESG assurance report.

A third-party verifier was also commissioned to carry out an audit on the annual reporting for the Green Bonds issued by the Group. This audit consists of verifying the compliance of funded assets with the set of eligibility criteria, concerning both their development and operation phases, which are defined in the Green Bonds Use of Proceeds (see Section 4.2.3 Current allocation of green bond proceeds). The detailed reporting and assurance report are disclosed in Section 4.2.4 (Independent third party’s report on green bond criteria and indicators).

All the portfolio energy data as well as the related carbon emission calculations used in this report have been audited based on PAS 2060 and the GHG protocol.

PAGE 150

2.3 Reporting on the EU Taxonomy

The European Union has established a taxonomy (the “EU Taxonomy”) to help direct investments towards sustainable projects and activities. From the viewpoint of companies, the taxonomy is a classification system meant to provide investors and policymakers with appropriate definitions for which economic activities can be considered environmentally sustainable according to the following six environmental objectives:

1. Climate change mitigation;
2. Climate change adaptation;
3. The sustainable use and protection of water and marine resources;
4. The transition to a circular economy;
5. Pollution prevention and control; and
6. The protection and restoration of biodiversity and ecosystems.

As of the publication date of this non-financial statement, the full set of regulations pertaining to the EU Taxonomy had not yet been passed. In accordance with the ones applicable to 2023 disclosures¹, in section 2.3 EU Taxonomy VGP reports only on the proportion of its economic activities that are “taxonomy-eligible” and “taxonomy-aligned” with respect to the first two objectives above.

¹ See Regulation (EU) 2020/852 and Article 10.2 of Commission Delegated Regulation (EU) 2021/2139 of July 4, 2021

COMPANY AT A GLANCE

2.4 Company at a glance

VGP is a pan-European owner, manager and developer of high-quality logistics and semi-industrial properties as well as a provider of renewable energy solutions. VGP has a fully integrated business model with extensive expertise and many years of experience along the entire value chain. VGP was founded in 1998 as a family-owned Belgian property developer in the Czech Republic and today operates with around 500 full-time employees in 16 European countries directly and through several 50:50 joint ventures. In December 2023, the gross asset value of VGP, including the 100% joint ventures, amounted to € 7.10 billion and the company had a net asset value (EPRA NTA) of € 3.2 billion. VGP is listed on Euronext Brussels (ISIN: BE0974292858).# .. Asset Management
VGP is a long-term real estate investor with its own rental portfolio owned and managed. Part of the portfolio is held in joint ventures for which VGP is responsible for the portfolio and asset management.

.. Development activities

Through the acquisition of a strategic land bank and with an in-house team with capabilities across the value chain VGP develops new business parks. In most developments VGP acts as general contractor and imposes strict pre-letting requirements. VGP safeguards continuous site supervision and developments to a high standard of environmental and health and safety policies.

.. Renewable Energy

Predominantly by engaging with tenants on self-consumption of renewable energy the Group has developed a third business line offering renewable energy solutions based on renewable energy generation in and around business parks.

.. Financial and operational highlights (FY )

Financial

Revenues	€ 113.7 million
Operating result	€ 118.8 million
Capital Expenditure	€ 858 million
Earnings per share	€ 3.20
Equity base	€ 2.21 billion
Financial debt (of which green bonds)	€ 2.00 billion (€ 1.6 billion)
Gearing ratio	40.3%
Cash available	€ 0.2 billion

Operating metrics

Total FTE	368
Completed building portfolio (#/m²)	219/4,943,537
Buildings under construction (#/m²)	26/774,000

Portfolio performance

Total AuM	€ 7.19 billion
Net property income	€ 63.5 million
Leases committed	€ 350.8 million
Capital expenditure	€ 693 million
Occupancy ratio	98.9%

Renewable Energy business unit

Renewable energy income	€ 4.4 million
Solar capacity installed	101.8 MWp
Solar capacity under construction	69.0 MWp
Committed solar capacity	99.7 MWp
Number of EV charging stations installed	545
Chargers	

Rent roll, including Joint Ventures at %:  buildings (,, m); main adjustment is exclusion of existing Russelsheim facilities (brownfield warehouses)

Group ESG Strategy

VGP Park Munich, Germany with new biotope corridor developed along the length of the park

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VGP NV ANNUAL REPORT 
GROUP ESG STRATEGY

. ESG Strategy: Building Tomorrow Today Together

.. Priorities of the Group ESG Strategy

Since , VGP has redefined its ESG strategy. Between  and , VGP had already achieved a cumulative reduction of % of its carbon intensity of own operations per employee and with regards to the portfolio a % reduction in energy intensity per square meter leased since . In doing so, the Group incorporated ESG in its entire value chain and aims to address the wide scope of indirect carbon emissions resulting from development activities, tenants’ energy consumption and employees’ transport and office use. While VGP’s agenda on fighting climate change remains central, the ESG strategy also onboards environmental and societal challenges like the circular economy and environmentally friendly transport, but also critical social responsibilities on diversity and inclusion and employee well-being. VGP’s ESG strategy relies on an efficient ESG governance structure allowing decision making at the appropriate level within the organisation and covering all countries (presented in Section . Govern-ance of ESG), and ESG-related risks are included into the Group’s risk management framework. Our ESG strategy builds on the conclusions of the materiality analysis and the analysis of ESG risks. It addresses the main challenges facing semi-industrial and logistics real estate: moving towards a low-carbon economy and sustainable mobility, fully integrating the Group’s business activities within local communities, and empowering teams on sustainability and diversity. VGP’s ESG strategy rests on five main pillars as outlined in the chart and as used as the ESG challenges and opportunities. VGP’s current approach to Environmental Social and Governance (“ESG”) has been structured on solid grounds, going way beyond regulation. In order to define its ESG strategy, the Group has identified key areas of work, representing challenges and opportunities related to its activities. Two complementary approaches were used to that end:
— A materiality analysis, which is a mapping tool used to identify and order the important ESG issues for the Group from an internal as well as an external stakeholder perspective; and
— A risk analysis, which is a framework used to highlight the ESG issues likely to negatively impact the Group.

CORPORATE RESPONSIBILITY REPORT 
PAGE 
ESG STRATEGY: BUILDING TOMORROW TODAY TOGETHER

• Integrated ESG risk management and governance
• Sustainable properties
• Improve eco-efficiency
• Strengthen communities
• Protect and improve biodiversity
• Empowering our workforce
• Protect ecosystem and address climate change

BUILDING TOMORROW TODAY TOGETHER
VGP Park Laatzen, Germany

CORPORATE RESPONSIBILITY REPORT 
PAGE 
ESG STRATEGY: BUILDING TOMORROW TODAY TOGETHER

.. Materiality matrix

In , VGP updated its  materiality matrix in order to align and identify its current ESG-related priorities. This work was done on the basis of an analysis of the main ESG reporting standards (taking into account Global Reporting Initiative Construction and Real Estate Disclosure recommendations), investor expectations (including GRESB questionnaire), underlying market trends, best practices observed in the real estate industry and beyond. The business impact of each ESG topic has been assessed across value levers (value protection, revenue increase, cost reductions, improved valuation, preferred financing and new revenue sources) and by appraising the magnitude of the impact. The importance for external stakeholders (regulator, investor, municipality and tenant expectations) takes into account the current or upcoming regulation and the following market trends used as proxies: renewable energy integration, circular economy practices, urban logistics and the electrification of fleet and climate change. Executive Management validated the updated materiality matrix, which confirmed the main priorities identified through the previous analysis. These priorities, in line with the parallel work done on risks (see section .. ESG risks and opportunities), reconfirmed the  focus areas for the Group sustainability strategy (see introduction of Section . ESG Strategy: Building Tomorrow Today Together).

.. ESG risks and opportunities

In , in response to the TCFD, VGP identified and assessed its main ESG risks, using the Group risk assessment methodology taking into account three impact criteria: financial, legal and reputational. In line with the spirit of the regulation, the analysis provided presents gross risks (before the implementation of management measures). The Group ESG risk universe was defined on the basis of both the ESG priorities highlighted by the Group’s materiality analysis (see Section .. Materiality matrix) and the sector based ESG risk universe established by the work done in . In total,  risks were identified and classified into  categories, among which  were identified as main ESG risks due to their level of impact. The risk analysis and ranking work was undertaken jointly by the Group’s ESG team and Group Finance Department, with the involvement of the local teams. The results were shared with the members of the Group Management Board overseeing Group resources and ESG. Subsequently these climate change and ESG risks have been identified as a risk factor in the Group’s risk management framework (see Environmental, sustainability and climate change risks in the Section Risk Factors for more details). The following sections summarise the main ESG risks, and the policies, action plans, performance indicators and opportunities associated with their management. Climate change risks for the Group (physical and transitional) form a core part of the ESG risks analysis and are integrated in the following summary of main ESG risks and their management policies. A more detailed overview of climate risk management and in particular of the resilience of assets to physical climate risks is provided in Section ... Related policies and action plans described reflect the latest updates made by the Group to mitigate these risks, as do all associated performance indicators disclosed.

																
1. Safety and security	2. Workforce well-being and engagement	3. Inclusive and innovative culture	4. Talent attraction and retention	5. Community engagement and development	6. Operational eco-efficiency	7. Sustainable building design/certification	8. Construction materials & waste	9. Green financing	10. Corporate governance	11. Resilience	12. Ethics and compliance	13. Sustainable procurement practices	14. Nature and biodiversity	15. Climate change	16. Facilitating sustainable mobility	17. Philanthropy and volunteering

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GROUP ESG STRATEGY

ESG COMMITMENT	Associated risk	Risk level	Change in risk level	Stakeholders	Management approach	Key Performance Indicators	Reference section
Failure to take into account stakeholders’ growing expectations regarding sustainability	Medium	—	employees — tenants — local communities — suppliers — investors — public authorities	— Execute on ESG Strategy: transparency on actions and results — Dialogue with stakeholders — Response to non-financial rating agencies	— ESG performance indicators — Stakeholder engagement survey responses — Ratings from external benchmarks/ agencies — Revenue growth — Employee/tenant satisfaction and retention rate	ESG chapter 2 — Green financing of the Group activities– section 4
BUSINESS ETHICS	Associated risk	Risk level	Change in risk level	Stakeholders	Management approach	Key Performance Indicators	Reference section
Bribery and corruption risk, money laundering and financing of terrorism or non-compliance with regulations	High	—	employees — public authorities — tenants — suppliers	The Group Code of Conduct

ESG STRATEGY: BUILDING TOMORROW TODAY TOGETHER

ESG COMMITMENT

| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach | Key Performance Indicators # CORPORATE RESPONSIBILITY REPORT

ESG STRATEGY: BUILDING TOMORROW TODAY TOGETHER

HUMAN CAPITAL

| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach # VGP NV ANNUAL REPORT

GROUP ESG STRATEGY

PROTECT ENVIRONMENT

| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach # ESG STRATEGY: BUILDING TOMORROW TODAY TOGETHER

CLIMATE CHANGE

| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach # SECTION NATURAL RESOURCES AND CIRCULAR ECONOMY

Associated risk

Energy management

| Associated risk \n### Energy Management\n\n## Section 3.3.3 Energy Management\n\n## Section 3.3.4 Decarbonisation scenarios (CRREM)\n\n### Climate related financial disclosures\n\n### Section 3.1.3.4 Increase of CapEx & OpEx, including tension on the price of energy\n\nHigh\n\n tenants\n public authorities\n investors (incl joint venture partners)\n\n Energy efficiency targets and energy management action plans are increasingly being rolled out in standing assets, involving energy consumption optimisation actions as well as investments in energy efficient equipment in new construction projects\n The EMS of the Group supports the objective to improve environmental performance of all standing and development assets of the Group\n Shift towards sourcing electricity from renewable energy sources for all assets, driven by the development of on-site renewable energy production capacity\n The Group is actively engaging with stakeholders to improve energy efficiency and source renewable energy, including tenants and suppliers\n The Group’s energy unit, VGP Renewable Energy, successfully applied for electricity grid-utility status (“netzbetrieber”) in Germany and soon similar status in Romania is anticipated. This will allow the Group to offer green electricity more effectively to our tenants\n Energy intensity per square meter of use (kWh/m²)\n Carbon intensity linked with energy consumption of standing assets (Scope 3 “portfolio in use”: Category 13: downstream leased assets)\n\n## Section 3.2 Sustainable Properties\n\n The refurbishment program which aims to enhance the eco-efficiency of the existing portfolio is explained in section 3.3.3 Energy Management and 3.3.4. Decarbonization scenarios (CRREM)\n\n### Changing tenant needs towards EV charging infrastructure\n\nLow\n\n tenants\n community\n public authorities\n investors (incl joint venture partners)\n\n ESG policy requires for all existing parks as well as for new developments EV chargers at tenant parking spaces\n The cost of EV chargers (sufficient to comply with VGP’s policy) is factored into all new development and refurbishment budgets\n Number of parks with EV chargers\n* KWh charged at EV chargers\n\n## Section 3.3.7 Develop connectivity and sustainable mobility\n\nPAGE  VGP NV ANNUAL REPORT \n\nSECTION NATURAL RESOURCES AND CIRCULAR ECONOMY\n\n| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach | Key Performance Indicators | Reference section |\n| :--- | :--- | :--- | :--- | :--- | :--- | :--- |\n| Inadequate performance on waste management operations | Low | | tenants, service providers | Review with tenants waste services and collection to enhance data collection and waste performance (sorting, recovery, etc.) | The percentage of assets certified (BREEAM/DGNB)
The percentage of recovered waste
The percentage of tenant contracts engaged in a circular economy approach | Sections Waste Management section 3.3.6 and 3.2.2 Environmental certifications |\n| Tensions over materials needed for development projects | Medium | | suppliers, contractors, public authorities | For development projects, a life-cycle assessment is being conducted which will help the Group to identify opportunities to reduce the amount of materials used and their carbon footprint
For development activities, an internal pricing mechanism for embodied carbon supports calculating and like-for-like comparing the carbon saving versus the investment costs | BREEAM/DGNB New Construction certification (level: Excellent / Gold)
Carbon intensity linked with development activities per sqm delivered | Sections 3.2.2 Environmental certifications and section 3.1.2.4 Focus on embodied carbons in development projects |\n\n## GOVERNANCE\n\n| Associated risk | Risk level | Change in risk level | Stakeholders | Management approach # CORPORATE RESPONSIBILITY REPORT

GOVERNANCE OF ESG

As a key topic of ESG program, climate change is fully integrated in the ESG governance (as described below). The ESG team leverages several key components of the Group organisation:
— The Chief Operating Officers (COOs) of each region support the implementation of the ESG strategy at country level
— The Group relies on ESG local correspondents in each country to help following country ESG performance and coordinate with the Group ESG team; and
— Key transversal functions, in charge of providing relevant guidelines and functional support to countries to implement areas of the ESG program, like the Legal and Compliance team and Finance and Risk

Sustainable buildings and practices
Communities
Human Capital
Land acquisition
Facility management
New leases
Asset management
New developments
Human resources

Board
Once a year

Management Team
Several times a year

ESG in-country correspondents
Continuous

Group ESG team
Transversal management

Integration within core processes

The ESG approach is fully embedded into the key processes of VGP, in line with the Group’s strategic priorities and operational concerns. Relevant management processes have been set up at each stage of the business cycle, along with appropriate key performance indicators. For example:
— The VGP due diligence process for new land acquisitions includes a complete audit of regulatory, climate change and environmental and Health and Safety risks, including soil contamination;
— The Group’s risk management framework includes climate change and ESG risks: identified among the main risk factors, they are integrated in the risk management programme overviewed by the management team, which reports regularly to the Board (see Section “Risk management and internal controls” of the Remuneration Report for more details);
— Development projects are regularly reviewed in light of ESG targets;
— Managed assets have an environmental action plan, with annual performance reviews;
— The internal compliance team conducts regular assessments of the management and compliance processes in accordance with the rules set by VGP;
— HR processes ensure the promotion of diversity and inclusion and consider employee well-being as well as employee learning and development opportunities;
— The training path of new joiners as well as specific functions includes relevant ESG content;
— The annual incentive plan of management and of all eligible Group employees specifically integrate ESG-related performance criteria (see the remuneration section of this annual report for more details); and
— Standing assets and development projects integrate ESG components to ensure alignment with ESG targets.

VGP Park Laatzen, Germany

VGP in dialogue

To:	From:
Media	Press releases, Information events on new parks, Trade fairs
Business and Joint Venture Partners	New initiatives and Existing partnerships
Local Stakeholders	Personal meetings, Park visits, Neighborhood conversations
Capital Markets	Conferences, meetings, calls with investors and analysts
Suppliers	Joint projects, Supplier due diligence, Forums and conferences
Civil Society and NGOs	One-on-one meetings, Answering questions
	Networks and associations Meetings and conferences as member of local and pan-European associations
Employees	Idea Management, Internal Media
Clients	Meetings, Social Media, Trade Fairs

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GROUP ESG STRATEGY

Stakeholder engagement

We maintain an open dialogue with our stakeholders, including our investors, customers, employees, suppliers and the communities in which we operate. VGP reports to investors on its ESG strategy and achievements via regular publications (annual and corporate responsibility reports, semi-annual report, trading updates and news), answers to information requests, interaction with ESG rating and ranking providers, and through dedicated meetings. These meetings also enable VGP to learn more on key areas of interest for investors on ESG topics. The Group’s position in the various ESG ratings and evaluations is outlined in Section .. Results of non-financial ratings and indices. As a listed commercial real estate company, VGP is a member of the European Public Real Estate Association (“EPRA”). At country level, VGP is a member of professional organisations such as Bundesvereinigung Logistik (BVL) in Germany.

VGP Park Ceske Budejovice, Czech Republic

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VGP's Sustainable Building Standard

VGP Park Giessen am Alten Flughafen, Germany

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Climate Change Strategy

As part of its ESG strategy, the Group commits to cutting carbon emissions across its value chain. This commitment covers, in addition to its Scopes 1 and 2 emissions, the Group’s Scope 3 emissions, including:
— Greenhouse gas (GHG) emissions generated in the construction of its development projects; and
— GHG emissions due to the private energy consumption of its tenants.

The Group’s carbon reduction target between 2020 and 2030 breaks down into the following 3 complementary objectives:
— Reduce emissions from construction by -10% by 2030;
— Reduce emissions from other own activities by -70% by 2030; and
— Reduce emissions from energy consumption in buildings by -77% by 2030.

The carbon reduction targets of the Group cover all its activities, and all countries where the Group operates. In 2021, the Group’s GHG emissions reduction targets have been submitted to the Science Based Targets initiative (SBTi), except the one for construction. SBTi confirmed our targets as consistent with levels required to meet the goals of the Paris Agreements.
— The targets covering GHG emissions from the Group’s operations (Scopes 1 and 2) are consistent with reductions required to limit warming to 1.5°C, the most ambitious goal of the Paris Agreement; and
— The targets for the emissions from the Group’s value chain (Scope 3) meet the SBTi’s criteria for ambitious value chain goals, meaning they are in line with current best practices.

Science-based targets are emissions reduction targets in line with what the latest climate science says is needed to meet the goals of the Paris Agreement: to limit global warming to well-below 2°C above preindustrial levels and pursue efforts to limit warming to 1.5°C.

In 2021, the Group introduced a commitment to cutting carbon emissions across its value chain by -10% between 2020 and 2030. Although it may appear a minor reduction, achieving these objectives involves the active participation of all the Group’s employees within their areas of responsibility and the contribution of the Group’s stakeholders in driving change, mainly tenants, suppliers and contractors. It relies on strong partnerships with established suppliers and start-ups in order to accelerate the pace of transformation, particularly in the fields of low-carbon construction and new sustainable mobility solutions.

In 2023, the Group has been working on updating and securing all its carbon reduction trajectories and associated levers to consider, among other topics, both the latest internal methodologies and processes for carbon emissions calculations, and external decarbonation hypotheses (for transport, construction and operations). This work has been supported by external experts. Changes in carbon performance with regard to the targets is presented in section . Summary of the Group’s ESG achievements.

Reduce emissions from construction by 10%

VGP is committed to significantly reduce its carbon emissions from construction on a broad scope. In concrete terms, reducing its carbon intensity by 10% between 2020 and 2030 means dropping from an average, of 706 kgCO2 eq/m² constructed in 2020 to 635.4 kgCO2 eq/m² on average based on a similar volume of square meters delivered by the end of 2030.

In order to be better able to track the impact of actions required to deliver progress, the internal tool to calculate carbon emissions has been updated. Comparing the LCA calculations provided as part of BREEAM studies in various countries has shown that the BREEAM LCA guidelines are implemented differently in each country, this makes it difficult to compare achievements. Given the Group has a uniform building standard, in the new approach the weight is put more on specific improvement measures to reduce embodied carbons as opposed to be impacted by idiosyncratic location specifics for a certain project. The framework makes certain improvements for example a bearer structure built from wooden beams or columns (grown from responsible forestry), use of green steel or Ecopact concrete as building materials to reduce impact of construction materials, or specific renewable energy initiatives to reduce the lifetime operating carbons.

The new framework is based on the following three principals:
— Carbon Reference Pricing;
— Lean Building approach; and
— Circular economy solutions.

The Carbon reference pricing has been used on a mark-to-market reference price 1 and allows the Group to assess the economic implications or trade-offs for such things as risk impacts, net present value of new projects and the cost-benefit of various design alternatives and initiatives. For more information please refer to section 5.3.3 Construction materials.

Reduce emissions from tenant operations by 77%

When it comes to standing assets, VGP’s carbon footprint consists mainly of GHG emissions from energy consumed by its tenants as part of the operation of its buildings. Achieving its ambitious target of reducing carbon emissions from operations by 77% between 2020 and 2030 draws on 2 levers simultaneously:
— Improving energy efficiency of the Group’s assets. The Group pursues the objective of improving the energy efficiency of its assets by 20% (in kWh/m²) between 2020 and 2030.# COMMITMENTS

3.1.1 Reduce emissions from own operations by 15%

The target to reduce absolute GHG emissions from Scopes 1 and 2 (emissions from operations under the Group’s control) by 15% between 2020 and 2025 reflects the Group’s ambition to decarbonate its direct operations. This target is approved by the SBTi with a 1.5°C pathway alignment, the most ambitious goal of the Paris Agreement. The levers identified to reach the Group’s carbon reduction target from operations are described in section 3.1.3.5 Focus on emissions from tenant operations. VGP’s carbon performance with regard to the Scopes 1 and 2 target is presented in section 3.1.3 Carbon assessment.

3.1.2 VGP contributes to Global Carbon Neutrality

In addition to the Group’s ambitious science-based targets, VGP is committed to contributing towards global carbon neutrality. EU Green Deal has set binding reduction targets for 2030 and announced a recommended 55% reduction target for 2030 as announced in February 2020¹. The Group is implementing initiatives across its value chain in order to achieve this objective, an integral part of this effort is the path towards carbon neutrality in the standing portfolio which is monitored through the CRREM tool (see section 3.2.4 Decarbonisation scenario’s (CRREM)), but the group is also monitoring decarbonisation accross its suppliers’ value chain, specifically through quantifying and increasing “avoided emissions” for its partners, including carbon removals as close as possible to the Group’s business.

¹ Delivering the European Green Deal – European Commission (europa.eu) and Recommendation for 2030 emissions reduction target (europa.eu)

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3.1.3 Carbon assessment

3.1.3.1 Methodology

The method used for quantifying Group emissions is in line with the ISO 14064-1 standard, the GHG protocol guidelines and the Bilan Carbone® methodology of ADEME (Agence de l’Environnement et de la Maîtrise de l’Énergie, or French Environment and Energy Management Agency). The sources of emissions included in the Group’s total carbon footprint are broken down per Scope and influence level in the table hereafter. The Group calculates its carbon footprint on an extended Scope 3 basis, which is outlined in this table, measuring the major indirect emissions across its entire value chain. To reflect the Group’s business activities in the most accurate manner, including the interactions between the company and its stakeholders, Scope 3 has been further broken down into three categories:

• Scope 3 own offices and employees (under VGP’s operational control);
• Scope 3 related to portfolio “in use”: Responsibility of tenants that VGP can influence but does not control directly.
• Scope 3 related to development activities through embodied carbon

Scope 1 — Direct emissions from stationary combustion: gas and fuel consumption in VGP offices
— Direct emissions from mobile combustion: fuel used for company vehicles
— Direct fugitive emissions including leaks of refrigerant gas

Scope 2 — Indirect emissions linked to electricity and district heating in VGP offices and used to charge company vehicles (linked to energy production only)

Scope 3 – Own offices and employees
Scope 3: Category 1 (purchased goods & services) — Indirect emissions from paper usage in VGP offices (other purchased goods & services not considered)
Scope 3: Category 3 (indirect energy) — Upstream emissions of purchased fuels and energy (extraction, production and transport of fuel, electricity)
Scope 3: Category 5 (waste on-site) — Indirect emissions from waste at offices
Scope 3: Category 6 (business travel) — Indirect emissions from employees’ business travel (excluding company vehicles)
Scope 3: Category 7 (employee commuting) — Indirect emissions from employees’ commute from home to work (excluding company vehicles)

Scope 3 – Portfolio “in use” (tenant activities)
Scope 3: Category 13: downstream leased assets — Indirect emissions from energy consumption and fugitive emissions due to leaks of refrigerant gas/fluid in tenant’s operations in VGP’s standing portfolio

Scope 3 – embodied carbon in development activities (life cycle analysis)
Scope 3: Category 1 (developments) — Emissions caused over the life-time use of the assets created by the development activities, including materials used and indirect emissions caused by transport to site, as well as future usage of the building
Scope 3: Category 11 (Use of sold products – Life time maintenance) — Emissions from the use of goods and services sold by the reporting company in the reporting year. A reporting company’s scope 3 emissions from use of sold products include the scope 1 and scope 2 emissions of end users. End users include both consumers and business customers that use final products.
Scope 3: Category 11 (Use of sold products – Energy) — Emissions from the use of goods and services sold by the reporting company in the reporting year. A reporting company’s scope 3 emissions from use of sold products include the scope 1 and scope 2 emissions of end users. End users include both consumers and business customers that use final products.

Scope 4 (total avoided emissions elsewhere) — Emissions avoided elsewhere when renewable energy is injected into the grid and therefore used as a substitute for grey energy elsewhere, fulfilling the same functions but with a lower carbon intensity

GHG emissions are expressed according to the “Market based” and “Location-Based” method.

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3.1.3.2 Results: Group carbon footprint

GHG emissions are preferably expressed according to the “Market-Based” method (suppliers’ emissions factors) in order to highlight the efforts made in selecting the Group’s energy suppliers. However, to take into account the expectations of various stakeholders, results are also expressed according to the “Location-Based” approach (countries’ emissions factors) in this section. Further in the document, all results related to GHG emissions are presented according to the “Market-Based” method, unless explicitly stated otherwise. The carbon footprint for 2020 is the baseline for tracking the carbon-related objectives of the Group’s own operations as well as tenant operations and development activities.

Emissions: market/location based (in tCO2)

	FY 2020	FY 2021	FY 2022	FY2023
1 Scope 1	841	852	926	924
tCO2/FTE	3.5	2.7	2.5	2.5
Scope 2 – market-based	105	127	8	17
tCO2/FTE	0.4	0.4	0.0	0.0
Scope 2 – location-based	127	107	113	144
tCO2/FTE	0.4	0.3	0.4	0.4
Total Scope 1 and 2	946	979	934	942
tCO2/FTE	3.9	3.2	2.6	2.6
Scope 3 – own offices and employees	1,039	942	1,302	1,063
tCO2/FTE	4.3	3.1	3.6	2.9
Category 1 (paper use)	4.9	2.7	3.0	2.7
Category 3 (indirect energy)	39.4	235.9	230.0	231.3
Category 5 (waste)	4.7	2.0	2.0	0.7
Category 6 (business travel)	210.6	541.9	861.0	682.4
Category 7 (employee commuting)	98.4	159.3	206.0	145.5
Total Own offices and employees	1,984	1,921	2,238	2,004
tCO2/FTE	7.9	6.3	6.1	5.5
Scope 3 – portfolio “in use” (category 13: downstream leased assets)	67,456	68,251	87,261	104,863
kgCO2/m²	27.6	22.1	20.3	21.2
Scope 3 – embodied carbon developments (cat. 1 + cat. 11)	269,223	297,686	538,260	313,172
kgCO2/m²	507	457	472	489
Total Scope 3	337,718	366,879	626,823	419,097
Total GHG emissions	338,663	367,858	627,757	420,039
Total avoided emissions (so called “Scope 4”)	(4,305)	(6,314)	(7,328)	(21,083)

¹ The underlined values were subject to limited assurance
² Change compared to prior reported figure due to entities that had wrongly been allocated a grossed up heating fuel amount.
³ Considerations for the evaluation of the scope 1 emissions: Scope 1 is set up in accordance with the GHG protocol and reflects the fuel use and district heating used for the heating of VGP offices and the fuel use of the company cars. The Scope 1 emissions that come from fuels used for heating and are calculated in accordance with the GHG protocol. For Austria, Denmark, France, Latvia, Luxembourg, Serbia and Slovakia the fuel use has been based on extrapolation. The extrapolations were made by making an average between Romania’s, Belgium’s and The Netherlands's VGP office surface and natural gas consumption. The remainder of Scope 1 emissions come from the emissions of company cars. To calculate the emissions from company cars the KM's driven (estimates derived from lease contracts or employee statements) and the used liters of fuel consumed were used. One extrapolation was made to come to the fuel use of the company cars in the Seville office in Spain. The extrapolation was made by multiplying an average of other sites that have evidence, and the number of employees of the respective site. The 9.2% decrease y-o-y on the one hand reflects the transition in the car fleet from a fuel based fleet to an electrical or hybrid car fleet.# CORPORATE RESPONSIBILITY REPORT

ADDRESS CLIMATE CHANGE

This effect is offset by the increase of emissions that come from office heating, this increase is mainly caused by increase of 3% surface area of the offices.

Considerations for the evaluation of the scope 3 emissions (Market based & Location based):

Scope 3 is set up in accordance with the GHG protocol and reflect the emissions from the electricity consumption in the offices and the electricity used to charge the electric company cars. The Scope 3 emissions that reflect the energy consumption of offices are calculated in the following manner: For the calculation of the total emissions, extrapolations were made for the offices in Austria, Denmark, France, Latvia, Luxembourg, Portugal (Lisbon) Serbia, and Spain (Madrid, Sarragosse, Seville). The extrapolation was made based on surface area of the offices multiplied by an average that was calculated based on all the other offices that have evidence for their consumption. The Scope 3 emissions that reflect the electricity used for electric vehicles have been calculated without the use of extrapolations. In 2023 VGP saw a significant increase in the amount of EV's in the company’s fleet. As the VGP Offices have a PPA for green energy, the KWh amounts charged at office charging facilities have been included under this arrangement and are considered to use green energy. The 15% y-o-y increase in the location based scope 3 emissions is explained by the 13% increase in energy usage compared to the 2022 period (the 13% increase in office size being a main driver together with office charging of the EV fleet). Another minor driver for the increase in location based emissions are the y-o-y changes in emission factors. The 35% increase in market based scope 3 emissions is caused by the increase electric vehicles and their charging outside of the office facilities. The KWh’s charging are considered to be grey energy.

Considerations for the evaluation of the Scope 3, Category 3 emissions:

The emissions in this category consist of Indirect emissions from energy consumption and fugitive emissions due to leaks of refrigerant gas/fluid in tenant’s operations in VGP’s standing portfolio. The 19% YoY increase of emissions can be explained due to a ca. 35% growth of the m² in the portfolio combined with part of the portfolio that was delivered at the end of FY21 being taken in full use over FY’23. The total amount of buildings considered in the 2021 sample was 305 and in 2023 there were 311 buildings considered. From this 311, 57 buildings used full or partial extrapolations for the Fuel use and 12 buildings used full or partial extrapolation for the Electricity use. The extrapolations are based on the averages per industry segment that have been determined out of the available data for the applicable year. We have identified the following segments: Industrial: Non-refrigerated warehouse, Industrial: Refrigerated warehouse, Industrial: Manufacturing, Office: Corporate: Low-Rise Office, Other: Parking (Indoors). For further details on the evolution of the tenant in – use emissions please refer to section 3.3.3.

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Scope 1 and 2 emissions’ intensity has reduced by 34% since 2018: Due to the significant growth of the organisation since 2018 the total emissions have only reduced by 4 tCO2e despite the intensity reduction of 34%.

Scope 1 and 2 emissions per employee (tCo2/FTE)
Total Scope 1 and 2 emissions (in tCO2)

Breakdown of the Group's carbon footprint by activity
Own offices and operations – 0%
Tenant's energy – 25%
Development activities – 75%

Target
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
1,200
1,000
800
600
400
200
0

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3.2.1.3 Focus on emissions from tenant operations

The Group has a target of reducing GHG emissions from its tenants’ operations by 17% between 2018 and 2025. To manage the carbon performance of the operational activities in VGP parks, the Group has set indicators to measure the intensity of GHG emissions per area (m²) for each of its operated VGP Parks. The Group has been able to collect 75% of the relevant electricity and fuel consumption data from its tenants, and for the remainder of the areas the data has been grossed-up, taking into account the type of occupation/tenant activity for its warehouse. This makes it possible to analyse a building’s overall carbon efficiency on a comparable basis, depending on its purpose and scope. Due to an acceleration of the data collection process, the percentage of data collected was lower than in previous years (see section 3.3.3 Energy Man- agement for further information).

In 2023, the carbon intensity linked to the energy consumption (Scope 3) of the Group’s standing portfolio (CO2 eq/m²) decreased by 25% compared with 2018 even though compared to 2021 the carbon intensity increased by 16% on a like-for like basis. This increase was mainly due to a significant increase in the grey electricity intensity factor. The weighted average grey electricity intensity factor across Europe increased by 27% year-over-year (see table below) driven by grey electricity intensity factors for 2023 being based on 2022 spike in coal and fossil fuel use, even though some of this reversed during 2023 ¹. For the VGP portfolio, this increase was partially offset by lower gas usage (due to transition to heat pumps) and transition to renew- able energy sources.

GHG emissions from energy consumption of standing assets (Tonnes of CO2 Eq)

	2023	Change vs 2020 base year (22)	% 2023
Total	104,863
Like-for-like change		(72,763 tCO2 eq)/2022 (54,022 tCO2 eq)	27 %

For reference:
2023/2022 grid electricity carbon intensity change ³ 29 %

The grid factor is expected to adjust downward over the year 2024 and the transition towards electricity between renewable sources under the photovoltaic investment plan is expected to continue contributing to a reduction in grid consumption, with newly delivered warehouses typically at least partially powered by electricity from renewable energy generated on site (see Section 3.3.3 Energy management).

Other than GHG emissions from the energy consumption of its buildings, the main item of the Group’s direct GHG emissions related to the operation of its buildings is from the leakage of refrigerants from cooling appliances maintained by the property managers of sites owned and/ or managed by the Group.

GHG emissions from energy consumption of standing assets (Tonnes of CO2 Eq)

	2023
GHG emissions linked with refrigerant losses	1,357

¹ Germany’s coal power production drops to lowest level in 10 years in 2023 | Clean Energy Wire
² These emissions are expressed based on emission factors for each source of energy using the “market-based” method of the GHG protocol, according to which these factors depend on the type of energy consumed (electricity, natural gas, etc.), the country, the supplier and the nature of the energy product (energy from fossil fuels or renewable sources). These are specific factors associated with the contractual commitments between the supplier and property manager which do not necessarily reflect emissions from energy delivered by the grid but valorise and focus on the production and purchase of energy that is certified as generated from renewable sources.
³ Based on VGP portfolio weighted variation of estimation factors for grey electricity over the whole portfolio– using grid mix data from IEA and estimation factor from Ecoinvent (source: Southpole).

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3.2.1.4 Focus on embodied carbons in development projects

In 2023 the embodied carbon calculations have been recalibrated based on a broader sam- ple methodology, where previously the Group reported embodied carbons for 2018 in total of 157,068 tCO2, this has been recalculated to 147,771 tCO2. As a result, the intensity reduced from 436 kgCO2/m² to 406 kgCO2. Given the base line has been reduced the target for the Group for 2025 has also been reduced accordingly: where previously the Group needed to reduce to 375 kgCO2/m² is now a reduction required to 347 kgCO2/m², assuming the same level of construction activity. Since 2018, the Group has achieved a reduction of 7% in terms of intensity. Due to the higher levels of construction completions in 2023 compared to 2018 has resulted in an absolute increase in emissions of 15%. The year 2021 saw the lowest level of carbon intensity which was driven by efficient buildings delivered including buildings delivered in VGP Park Laatzen, VGP Park Magdeburg, VGP Park Göttingen and VGP Park Nijmegen. The year 2022 benefited from efficient carbon projects delivered in VGP Park Graz (part wooden bearer structure), VGP Park Laatzen (including now DGNB Platinum certified building “GERLACH – A”), buildings in VGP Park München and additional buildings in VGP Park Magdeburg. 2023 saw, whilst carbon reduc- tion initiatives get more broadly implemented (example projects in VGP Park Giessen am Alten Flughafen, VGP Park Erfurt and VGP Park Roosendaal) also a mix shift skewed towards Eastern European buildings which on average still have a higher carbon footprint.

	FY 2020	FY 2021	FY 2022	FY2023
Scope 3– embodied carbon developments (cat. 1 + cat. 11)	269,223	297,686	538,260	313,172
kgCO2/m²	507	457	472	489
Category 1	109,680	140,258	245,218	134,327
kgCO2/m²	207	215	215	210
Category 11	159,543	157,428	293,042	178,845
kgCO2/m²	300	241	257	279

VGP Park München, Germany

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3.2.2 Climate risk management and adaptation to climate change

The Group’s Risk Management Framework is presented in Chapter “Risk Factors”. Sustaina- bility risks were identified at Group level (see section “Risk Factors”); this section presents a detailed analysis of the climate change risks for the Group.# ADDRESS CLIMATE CHANGE

3.2.3.1 Physical risks

In 2023, the Group completed a study of both its standing assets and development projects using the Blue Auditor’s Climate Risk tool which is based on Moody´s Real Assets Physical Climate Risk & Corporate Facility Operations Risk product to assess exposure to physical risks. The study is compliant with the EU Taxonomy requirements (see “Adaptation to climate change” paragraph in section 2.1.3 VGP Share of aligned activities) and brought to the Group an updated perspective of the risk level, relying on state-of-the-art climate modelling. In addition, assets’ visits have been conducted on the most exposed assets to evaluate more precisely the impact curves of the potential risks considering the details of the asset (topography, localisation of the technical equipment, existing resilience solutions already in place, etc.).

Climate change physical exposure risk at asset level based on RCP 8.5 and RCP 4.5 by 2050

Hazard	Metric	Scenario	# Parks	GLA (JVs at 100%)	GAV (JVs at 100%)	Regions most affected
Fluvial (River) and pluvial (Rainfall) flooding	1 in 100-year return period	8.5, 2050	10	4.6 %	6.6 %	Asset specific, including broader Ruhr/Rhine area, Po river delta
Sea level rise	“High” and “Very High” Risk	8.5, 2050	0	0 %	0 %
Sea level flooding risk	low/no risk across regions
Drought Stress	“High” and “Very High” Risk	8.5, 2050	19	9.7 %	9.3 %	Iberia, Romania
Heat Stress	“High” and “Very High” Risk	8.5, 2050	25	15.4 %	12.9 %	Hungary, Italy, Spain, Romania, Croatia, Serbia
Wildfire risk	“High” and “Very High” Risk	8.5, 2050	2	0.7 %	0.7 %	Asset specific

The table above shows the modelled climate change physical exposure risk metrics and outcomes based on percentage of floor area and rental value at risk based on the worst-case scenario (RCP 8.5, 2050). The assessment report and data above do not consider any asset specific development or refurbishment mitigation cycles. As part of our sustainable development objectives, assessments are carried out prior to development and adaptation measures, including but not limited to those listed below, are carried out accordingly. The map below highlights the average climate risk assessment (CRA)-score (0-100/low-high) based on a “desktop” assessment per park with average scores based on the summary findings per hazard category as listed in the table above.

Implemented adaptation measures to address these risks include the incorporation of green spaces, rainwater harvesting and sustainable drainage systems to reduce the risk of flooding, access to natural light in the buildings, and the provision of infrastructure for active mobility and public transport. Additionally, measures to improve the energy efficiency of buildings and the use of renewable energy sources can also help to reduce the risk of heat stress – in Spain and Italy all new buildings are therefore fitted with photovoltaic installations and heat pumps which help to provide additional cooling in summer. The buildings are designed to provide a comfortable and healthy indoor environment, taking into account factors such as ventilation, thermal comfort, and indoor air quality. It is important to note that climate risk analysis and adaptation measures are an ongoing process, as the impacts of climate change are constantly evolving and new risks may arise over time. Therefore, it is important for companies to regularly review and update their climate risk analysis and adaptation measures to ensure that they are effectively addressing the latest climate-related risks. This includes monitoring the performance of the building, gathering feedback from tenants and evaluating the effectiveness of the adaptation measures, and making adjustments as necessary.

Risk Adaptation Technique

• Drought Stress and Heat Stress
  • Rainwater harvesting systems for building use and landscaping
  • Water efficient fixtures in line with EU Taxonomy regulations
  • Thermal modelling undertaken and orientation/ window positioning of the building reviewed
  • Onsite renewable energy generation installed in combination with heat pumps (which can be used for additional cooling)
  • External planting to provide shade, brise soleil, louvers, window tinting
• Fluvial (River) and pluvial (Rainfall) flooding
  • Flood risk assessment to be carried out on development or retrospectively
  • Wadi’s, ponds or basins (retention measures)

This update of the climate change risk assessment enabled VGP to have a clear view on the future risks of climate change for its portfolio.

3.2.3.2 Transition risks

We work with our stakeholders (see section 3.3.2 Stakeholder Engagement) to monitor, assess and prioritise emerging climate change transition risks. We judge materiality with reference to two main risks: the environmental and reputational risk of failing to meet our carbon emission reduction targets and the financial risk of building redundancy or being unable to lease our buildings. We believe that there are three main climate change transition risks with the potential to impact the Group financially:

• Environmental legislation: legislation surrounding the sustainability performance of commercial and non-commercial real estate is likely to tighten in the future as the EU pursues its commitments under the European Green Deal and Paris Agreement. We expect this to take the form of regulations but also increasingly some form of carbon tax to encourage the use of lower carbon materials and processes. The primary financial risk relates to our ability to rent out our buildings if they fall below emerging environmental legislation. This drives our determination to improve the energy performance of our portfolio both in new development and through refurbishment, measured primarily by increasing the floorspace rated B or better by Energy Performance Certificates.
• Client behaviour and preference: our tenants, particularly our largest, international clients, increasingly expect their premises to display high levels of energy efficiency. Energy efficiency not only reduces the operating costs of the building but also helps them with their own environmental and carbon reduction targets. The primary financial risk relates to the appeal of our buildings to tenants if they are below acceptable levels of energy efficiency and wider environmental sustainability. We are addressing this risk through improving the EPC ratings of our portfolio, increasing the amount of on-site renewable energy generation, offering off-site renewable energy through our regulated renewable energy utility business units, and improving the sustainability credentials of our developments.
• Access to capital: investors are increasingly discriminating between investment opportunities based on sustainability credentials. The primary financial risk relates to reduced availability and higher cost of capital for companies which do not show strong performance and/or progress in this area. Through our joint venture model, the Group is continuously “in the market” for selling assets to its own joint ventures. The appeal of our assets rests on an adherence to the latest ESG standards of the entire portfolio. Furthermore, under our Green Finance Framework, we have issued €3.0 billion of Green “Use of Proceeds” bonds since 2019.

3.2.3.3 Climate change strategic planning and decision making

In terms of decision making, we consider climate-related issues within the following time horizons:

• Short term: up to 12 months, in line with the annual budget setting carried out;
• Medium term: up to 3 years, in line with the Medium-Term Planning carried out by the Group;
• Long term: up to 20 years, in line with capital investment appraisal cash flows.

For the LCA calculation we also assume a 50-year life span for our newly developed properties. VGP performed its update of the CRREM study (Carbon Risk Real Estate Monitor) in 2023 to analyse stranding risks across its portfolio and mitigating measures. The results are presented in section 5.5.2 Decarbonisation scenarios (CRREM).# COMMITMENTS

CLIMATE-RELATED FINANCIAL DISCLOSURES

To enable our stakeholders to consider and compare our reporting, we contribute to a number of externally recognised initiatives including GRESB and CDP, and we also disclose metrics in line with externally-recognised frameworks including Global Reporting Initiative (GRI) and the EPRA Best Practices Recommendations on Sustainability Reporting (see section 2.3.7 Alignment with ESG reporting standards and frameworks for further details). In order to ensure that we also report on those issues that we can have a direct impact upon, we use our materiality assessment to identify the key metrics that are material to the business. Below are the climate-related metrics and targets which we monitor. Those in bold are incorporated into the ESG factor of the annual bonus of all employees.

Financial item	Climate-related Metric	2023	Narrative	Section reference
Assets	Physical – operational
Portfolio at risk of 1 in 100-year flood (% of GAV with JVs at 100%)	6.6 %	New metric based on analysis conducted in 2023	3.1.3.1 Physical risks
Assets	Transition – operational
EPCs rated below E (based on gross lettable area)	0 %	Since 2023 no asset with EPC score of below E	4.2.5.2 Green buildings
EPCs un-rated (based on number of assets)	20.6%	Un-rated space does not necessarily mean low rating; various have PV roof (will require new EPC rating); also includes parking houses and buildings in development with EPC certificate pending
EPCs rated B or better (based on number of assets)	48.3%	Indicative anticipated CAPEX investment of
Assets	Transition – development & market risk
Portfolio with high environmental certification (BREEAM Excellent or better (or equivalent)) (“Green portfolio”) – € amount	€ 1.86 billion	Comprises the building portfolio which is allocated to the Green Financing Framework (under Framework eligible portfolio also includes BREEAM Very Good assets and comprises €3.7 billion)	3.2.2 Environmental certifications
Liabilities	Transition – development & market risk
Percentage of net borrowings (incl JVs at share) classed as Green Financing under the Green Finance Framework	56 %	VGP issued € 1.6 billion in green bonds under the Green Finance Framework	4.2 Green bonds
Green finance instruments as % of the green portfolio (including joint venture assets at share)	41 %	Green finance instruments should not exceed the total green portfolio
CAPEX	Strategic risk/ GHG emissions
Visibility: % of portfolio for which energy data is available	67 %	New lease template since 2021 includes green clause for data sharing; many existing clients have no obligation to share data	3.3.2 Green leases and tenant commitments, 3.3.3 Energy Management
Visibility: % of completed developments for which LCA analysis is available	78%	Growing use of Life Cycle Assessment within the business ensure that we have good visibility of embodied carbon in development and we can target areas for reduction	3.2.1.1.2 Considerate construction charter
Embodied carbon intensity (kgCO2e per sq m of development space)	489	Based on updated embodied carbon assessment – based on life cycle of the buildings	3.1.2 Carbon assessment
Photovoltaic investments – spent or committed on projects completed or under construction	€ 108 million	A further €63 million to be spent on pipeline projects – total 270.5 MWp	3.3.3.5 Renewable energy procurement and production. 4.2.3 Current allocation of green bond proceeds
Revenues	Transition – market risk
Solar power generation – FY2023 (GWh)	46 GWh	Includes circa 2 GWh of solar energy not generating income. Production for 2024 is expected to exceed 85GWh	3.3.3.5 Renewable energy procurement and production
Solar power generation – annualised incl. pipeline (GWh)	244 MWh	Solar power generation as percentage of tenant electricity consumption	23 %	Including PV pipeline projects the coverage increases to 109%
Gross revenues from renewable energy	€ 4.4 million	Revenue generated from selling renewable energy to tenants of VGP Parks, energy sold into the grid or PV installations leased by tenants

SUSTAINABLE PROPERTIES

Sustainable Properties

Environmental management system

The Group’s environmental Management System (EMS) aims at reducing the environmental impact of our assets at every stage of their life cycle, from initial design to daily operation as well as future fungibility.

• Sustainable Design Framework: BREEAM/DGNB
• Sustainable Management Framework: BREEAM/DGNB in-use
• Review: Analyse and review performance with tenants and stakeholders
• Land sourcing: Sustainable check-list and environmental due diligence
• Track performance: Annual reporting
• Project review: Detailed design guidelines
• Action plan: Environmental action plan
• Construction: Green certification
• Policy & targets: Leasing
• Green leases: 2
• 1: Standing assets
• 3: New projects
• 4:
• 6:
• 7:
• 8:
• 5:

The Group has defined and monitors several indicators to manage the environmental performance of its standing assets and development projects, in line with the objectives of our ESG strategy. Some of these indicators are incorporated into the budget review processes for standing assets and development projects to ensure alignment between ESG objectives and business decisions. For more information on the Group’s Environmental Management System (EMS) please follow the link to VGP ESG policies and guidelines on: https://www.vgp-parks.eu/en/sustainability/

Sustainable Construction

Transition to a circular economy in construction projects

From the materials sourced to construct the building to the water required for bathroom facilities and greenery, logistics and semi-industrial sites use natural resources. Predominantly, today’s logistics real estate sector is designed on the linear “take-make-waste” concept. VGP wants to change this. In order to be compliant with the EU Taxonomy Do No Significant Harm – Transition to Circular Economy criterium the Group is transforming its approach to circular economy concepts defined by 5 principles, see also the following VGP Circular Economy chart.

With regards to the “Continuous Material Cycles”, in 2021 the Group introduced a target in-line with the applicable DNSH requirement for Construction of New Buildings under EU Taxonomy of at least 70% (by weight) of the non-hazardous construction and demolition waste generated at site to be processed for reuse or recycled or otherwise recovered. This requires strict waste monitoring at construction sites, as well as an implementation of improvement opportunities and execute best practice activities in order to: eliminate final waste and pollution, keep products and materials in use, and reduce the primary material consumption.

The Group is leveraging its relationships with construction materials suppliers to raise their awareness of sustainable construction and influence behaviour change towards circular economy practices. In 2022, the Group reached its target of recovering 70% of waste in 75% of the construction sites monitored. In 2023, VGP will work towards more projects being monitored, more ambitious waste management and continue to engage its suppliers in sustainable practices.

	2023
Share of waste monitored development projects that have at least 70% of waste recycling (material recovery)	88%
Number of development projects that comply with at least 70% of waste recycling material recovery (% of all projects delivered in 2023)	7 (29%)

In addition to limiting the waste generation and facilitating reuse and high-quality recycling during construction works, the Group also aims to ensure the building design and construction technology support the circular economy by making the building resource efficient, adaptable, flexible and dismantlable. When considering products and materials, VGP applies the BREEAM or DGNB certification standard to promote resource efficiency and lower emissions. The products are easier to maintain, reuse and recycle and must have an eco-label and/or lower environmental impact (such as PEFC™ or FSC®-certified timber). Throughout all stages of the building life cycle, preference is always given to suppliers with certified environmental management systems. See also the section 2.3.3.3 Considerate Construction Charter.

Considerate Construction Charter

Since 2011 the Group’s Considerate Construction Charter is applied to all greenfield/brownfield construction projects. It describes the Group’s requirements and recommendations intended to optimise its worksites’ environmental quality while minimising pollution for the contractors working on site, the neighbouring area and the natural environment.# COMMITMENTS

Environmental certifications

VGP, as part of its strategy for development projects, targets an environmental certification for all of its new greenfield/brownfield construction projects: DGNB (Deutsche Gesellschaft für Nachhaltiges Bauen) in Germany and Austria and BREEAM for the other countries. VGP aims to achieve a minimum level of “Gold” (DGNB) for its development projects in Germany and Aus- tria, and for the other countries “Excellent” (BREEAM) versus minimum required BREEAM Very Good. Higher environmental certifications are obtained, when relevant to the tenant. In addition to securing the “Excellent”/“Gold” level under BREEAM/ DGNB respectively, all projects need to undertake a technical and economic feasibility study to reach the BREEAM “Excellent” or DGNB “Gold” level respectively.

Coverage of BREEAM and DGNB environmental certification of standing assets and assets under construction in number of assets and gross lettable area:

Certification coverage	2023
Number of assets certified	76
Number of assets in process of obtaining certificate	88
% (in number)	66.1%
% (in m² GLA)	75.9%
Total certified warehouses
of which at least Excellent/Gold	24

• Excludes recently acquired brownfield sites identified for demolition

New construction – 61.4%
In use – 14.5%
Not certified – 24.1%

Breakdown of the Group assets by environmental certification level (in m² of gross lettable area):

	Good/Bronze	Very Good/Silver	Excellent/Gold	Outstanding/Platinum
1	1.9%	43.1%	52.7%	2.3%

Coverage of environmental certifications in operation and development within the Group’s total standing assets and assets under construction (in m² of gross lettable area)

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COMMITMENTS

Construction materials

Reducing carbon impact of construction materials

As part of its commitment to reducing its construction carbon footprint by 30% between 2020 and 2030, the Group focusses on the choice and use of the materials for its development pro- jects. In order to be better able to track the impact of actions required to deliver progress, the internal framework to evaluate carbon emission reduction initiatives has been updated. The new framework aims to make certain improvements easier to evaluate from a cost and carbon perspective, for example a bearer structure built from wooden beams or columns (grown from responsible forestry), use of green steel or Ecopact concrete as building materials to reduce impact of construction materials, or specific renewable energy initiatives to reduce the lifetime operating carbons. The new framework is based on the following three principals, Carbon Ref- erence Pricing, Lean Building approach and Circular economy solutions:

Carbon Ref- erence Pricing

Carbon reference pricing in new project yield calculations. The Internal Carbon Pricing scheme is a shadow price which allows the Group to apply carbon prices 1 in its strategic and operational decision making around new projects. It enables the Group to assess the economic implica- tions or trade-offs for such things as risk impacts, net present value of new projects and the cost-benefit of various design alternatives and initiatives.

1 In 2023 project evaluations the pricing was aligned with EU ETS as per Dec 2022 € 85.0/tCO2

VGP Park Hochheim, Germany

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COMMITMENTS

Lean Building approach

To achieve the Group’s reduction targets it is critical to provide project management the levers to implement viable low-car- bon alternatives through a “lean building” approach from the design phase using fewer materials, through optimised design choices: structure, fixtures and fittings, façades, ceil- ings, number of parking spaces, etc. This can be achieved by using new solutions for construc- tion and choosing alternative and low-carbon materials, such as low-carbon concrete and cement, wood and recycled prod- ucts, as well as selecting suppliers and products based on their location and place of manufacture, respectively.

Our procurement and our innovation team are developing tar- geted partnerships with construction firms and manufactur- ers of building materials for the implementation of innovative solutions

To secure the ESG Strategy commitments regarding construc- tion activities, the Group has created a Sustainability briefing package for development projects, to lead the development teams from the very beginning of the design phase to the delivery of development projects. It contains three parts:

• The Group Sustainability Brief, gathering all the specific requirements for development projects (brownfield, greenfield, refurbishments, renovations and extensions) to be in line with the Group’s ESG Strategy; and
• The 20 Golden Rules for sustainable construction, which set the right mindset and directions for the development teams to integrate sustainability topics in projects.

The Sustainability guidelines for development projects have been approved in 2022 and are rolled out throughout the Group. The sustainability performance of the development projects is closely monitored during key project reviews thanks to a dedicated assessment tool and focuses on the Group’s commitments towards low-carbon construc- tion and the compliance with the EU Taxonomy criteria for building development (see section 8.1.5 VGP Share of aligned activities).

• The Group also offers specific trainings for the development and construction managers to help them better under- stand the technical requirements of the Group’s Sustain- ability guidelines and new regulations around low-carbon buildings.

VGP’s carbon performance with regard to the construction target is presented in section 3.2 Summary of the Group’s ESG performance. Specifically, it involves:

• Adopting a “lean material construction” approach right from the design phase (structure, façade, false ceilings, fix- tures and fittings, etc.);
• Using new solutions and optimised low-carbon materials (low-carbon cement and concrete, bio-sourced materials, recycled materials, etc.). For example, at a building deliv- ered last year in VGP Park Graz, 153 Glulam timber beams were installed with a span of 12 to 16 metres for the roof, allowing for an 11,000 square metre building. This choice guarantees a reduction in material transport costs by assembling the beams on site and a more sustainable building.
• Asking subcontractors to put forward alternative solutions with low carbon content; and
• Adopting a purchasing policy that includes criteria for the carbon content of products and construction materials (requiring environmental and Health and Safety certifica- tion – Environmental Product Declarations).

Circular economy building materials solutions

Circular economy solutions can also lead to carbon savings, through material reuse for example as defined in the VGP 20 Golden Rules for sustainable construction which is, together with the Considerate Construction Charter, part of the VGP Building White Book and shared with our contractors. See also section 9.1.1.1.1 Transition to a circular economy in construc- tion projects.

The Consider- ate Construction Charter includes the following requirements:

• Using 75% of timber for development, extension and reno- vation projects from certified, sustainably managed forests with PEFC™ or FSC® certification, including for works;
• Providing information to people living nearby and limiting traffic disruptions;
• Informing contractors and employees of construction com- panies of applicable HSE rules;
• Ensuring proper management of risk;
• Managing and limiting noise and visual pollution, as well as the risk of soil, water and air pollution; and
• Monitoring resources to reduce resource consumption.

2023
Number of development projects that implement a Considerate Construction Charter
Share of development projects that implement a Considerate Construction Charter
Delivered projects completed a life cycle embodied carbon assessment (LCA)

III.II.IV.III

Pollution prevention

Moreover, the Group ensures that the action plans and pre- ventative measures are implemented by contractors dur- ing construction. The table below lists the annual monetary expenses for soil decontamination/site remediation and vol- umes that have been detoxified.

Soil pollution and site remediation	2022	2023
Monetary expenses for soil decontamination/ site remediation (€-million)	5.1	2.3
Volume that has been detoxified/handled (metric-tonnes)	14,900	3,723

III.II.IV.II.V

Health and safety on work sites

The construction contractors are contractually required to make the necessary provisions for site safety and comply with the relevant Health and Safety legislation. The contrac- tor’s teams develop the technical requirements provided to contractors within the tendering process. These include spe- cific safety requirements, as well as the applicable Health and Safety standard a successful bidder must comply with. Tender submissions that do not comply with the technical require- ments and the applicable Health and Safety standards are disqualified from the tendering process. During the construc- tion phase, site health, safety and security is continuously monitored by the construction contractor’s teams. Health and Safety Coordinators are appointed in all countries where the Group is active. They are employed by the contractor, with a principal function of coordinating health and safety matters between the various stakeholders. Health, Safety and Environ- ment (HSE) audits are conducted on a continuous basis.

GUIDED BY SYSTEMS THINKING
HOLISTIC URBAN PLANNING LEVERAGED BY DIGITAL TECHNOLOGY
DESIGN FOR MAINTENANCE AND DECONSTRUCTION
FLEXIBLE PRODUCTIVE BUILDINGS
SUPPORT HUMAN WELL-BEING AND NATURAL SYSTEMS
CONTINUOUS MATERIAL CYCLES
INTEGRATED INFRASTRUCTURE SYSTEMS

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COMMITMENTS

III.II.III Environmental certifications

VGP, as part of its strategy for development projects, targets an environmental certification for all of its new greenfield/brownfield construction projects: DGNB (Deutsche Gesellschaft für Nachhaltiges Bauen) in Germany and Austria and BREEAM for the other countries. VGP aims to achieve a minimum level of “Gold” (DGNB) for its development projects in Germany and Aus- tria, and for the other countries “Excellent” (BREEAM) versus minimum required BREEAM Very Good. Higher environmental certifications are obtained, when relevant to the tenant. In addition to securing the “Excellent”/“Gold” level under BREEAM/ DGNB respectively, all projects need to undertake a technical and economic feasibility study to reach the BREEAM “Excellent” or DGNB “Gold” level respectively.

Coverage of BREEAM and DGNB environmental certification of standing assets and assets under construction in number of assets and gross lettable area:

Certification coverage	2023
Number of assets certified	76
Number of assets in process of obtaining certificate	88
% (in number)	66.1%
% (in m² GLA)	75.9%
Total certified warehouses
of which at least Excellent/Gold	24

• Excludes recently acquired brownfield sites identified for demolition

New construction – 61.4%
In use – 14.5%
Not certified – 24.1%

Breakdown of the Group assets by environmental certification level (in m² of gross lettable area)

	Good/Bronze	Very Good/Silver	Excellent/Gold	Outstanding/Platinum
1	1.9%	43.1%	52.7%	2.3%

CORPORATE RESPONSIBILITY REPORT 2023

PAGE 175

SUSTAINABLE PROPERTIES

III.II.III Construction materials

III.II.III.II Reducing carbon impact of construction materials

As part of its commitment to reducing its construction carbon footprint by 30% between 2020 and 2030, the Group focusses on the choice and use of the materials for its development pro- jects. In order to be better able to track the impact of actions required to deliver progress, the internal framework to evaluate carbon emission reduction initiatives has been updated. The new framework aims to make certain improvements easier to evaluate from a cost and carbon perspective, for example a bearer structure built from wooden beams or columns (grown from responsible forestry), use of green steel or Ecopact concrete as building materials to reduce impact of construction materials, or specific renewable energy initiatives to reduce the lifetime operating carbons. The new framework is based on the following three principals, Carbon Ref- erence Pricing, Lean Building approach and Circular economy solutions:

Carbon Ref- erence Pricing

Carbon reference pricing in new project yield calculations. The Internal Carbon Pricing scheme is a shadow price which allows the Group to apply carbon prices 1 in its strategic and operational decision making around new projects. It enables the Group to assess the economic implica- tions or trade-offs for such things as risk impacts, net present value of new projects and the cost-benefit of various design alternatives and initiatives.

1 In 2023 project evaluations the pricing was aligned with EU ETS as per Dec 2022 € 85.0/tCO2

VGP Park Hochheim, Germany

PAGE 176

VGP NV ANNUAL REPORT 2023

COMMITMENTS

Lean Building approach

To achieve the Group’s reduction targets it is critical to provide project management the levers to implement viable low-car- bon alternatives through a “lean building” approach from the design phase using fewer materials, through optimised design choices: structure, fixtures and fittings, façades, ceil- ings, number of parking spaces, etc. This can be achieved by using new solutions for construc- tion and choosing alternative and low-carbon materials, such as low-carbon concrete and cement, wood and recycled prod- ucts, as well as selecting suppliers and products based on their location and place of manufacture, respectively.

Our procurement and our innovation team are developing tar- geted partnerships with construction firms and manufactur- ers of building materials for the implementation of innovative solutions

To secure the ESG Strategy commitments regarding construc- tion activities, the Group has created a Sustainability briefing package for development projects, to lead the development teams from the very beginning of the design phase to the delivery of development projects. It contains three parts:

• The Group Sustainability Brief, gathering all the specific requirements for development projects (brownfield, greenfield, refurbishments, renovations and extensions) to be in line with the Group’s ESG Strategy; and
• The 20 Golden Rules for sustainable construction, which set the right mindset and directions for the development teams to integrate sustainability topics in projects.

The Sustainability guidelines for development projects have been approved in 2022 and are rolled out throughout the Group. The sustainability performance of the development projects is closely monitored during key project reviews thanks to a dedicated assessment tool and focuses on the Group’s commitments towards low-carbon construc- tion and the compliance with the EU Taxonomy criteria for building development (see section 8.1.5 VGP Share of aligned activities).

• The Group also offers specific trainings for the development and construction managers to help them better under- stand the technical requirements of the Group’s Sustain- ability guidelines and new regulations around low-carbon buildings.

VGP’s carbon performance with regard to the construction target is presented in section 3.2 Summary of the Group’s ESG performance. Specifically, it involves:

• Adopting a “lean material construction” approach right from the design phase (structure, façade, false ceilings, fix- tures and fittings, etc.);
• Using new solutions and optimised low-carbon materials (low-carbon cement and concrete, bio-sourced materials, recycled materials, etc.). For example, at a building deliv- ered last year in VGP Park Graz, 153 Glulam timber beams were installed with a span of 12 to 16 metres for the roof, allowing for an 11,000 square metre building. This choice guarantees a reduction in material transport costs by assembling the beams on site and a more sustainable building.
• Asking subcontractors to put forward alternative solutions with low carbon content; and
• Adopting a purchasing policy that includes criteria for the carbon content of products and construction materials (requiring environmental and Health and Safety certifica- tion – Environmental Product Declarations).

Circular economy building materials solutions

Circular economy solutions can also lead to carbon savings, through material reuse for example as defined in the VGP 20 Golden Rules for sustainable construction which is, together with the Considerate Construction Charter, part of the VGP Building White Book and shared with our contractors. See also section 9.1.1.1.1 Transition to a circular economy in construc- tion projects.# VGP Park Laxenburg, Austria CORPORATE RESPONSIBILITY REPORT
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SUSTAINABLE PROPERTIES

.1.3 Responsible supply chain

Further to the research project as described in the previous section for which discussions were held with various suppliers to better understand and reduce the embodied carbon footprint of materials used, VGP is committed to ensuring responsibility in its upstream supply chain (development activities). The Considerate Construction Charter specifies that 100% of timber used in development, extension and renovation projects must be from certified, sustainably managed forests with FSC or PEFC certification. Besides, as part of the certification process (prerequisite for BREEAM and optional for DGNB), the sourcing of wood used during construction is verified and validated. The Group aims to obtain “post-construction” final certification according to the BREEAM or DGNB standards for all projects. All contractors are asked to abide by the terms of the Considerate Construction Charter. Also, in all its contracts, the Group requires the contractors to do their best efforts to reduce the carbon footprint of the project and the design project managers are asked to pay closer attention to this contractual requirement.

.1.4 Comfort, health, well-being and productivity for users of buildings

Comfort and well-being issues are a determining factor in our technical and architectural choices for development of the office as well as warehouse spaces (e.g. façades, sky lights, interior finishes of offices, canteens and other amenities, heating, ventilation and air-conditioning equipment, lighting, occupant control methods, etc.). The VGP Environmental Management System (available on our website) and VGP Building White Book provide steps on how to achieve comfortable and safe spaces, based on thermal comfort, visual comfort, acoustic comfort and interior air quality.

Construction works at VGP Park Riga, Latvia
PAGE 27

VGP NV ANNUAL REPORT 2023
COMMITMENTS

2.2 Improve eco-efficiency

VGP Park Hrádek nad Nisou, Czech Republic
CORPORATE RESPONSIBILITY REPORT
PAGE 28

IMPROVE ECO-EFFICIENCY

2.2.1 Environmental management system for existing assets

The EMS is implemented across the whole owned and joint venture portfolio. This pragmatic and dynamic EMS, based on an environmental continuous improvement approach (ISO 14001), ensures that the Group is able to meet its annual and long-term targets and supports VGP’s continuous improvement for each area covered by the Group’s ESG policy. This includes climate change adaptation and sustainable resource use. It completes the development projects’ EMS, as part of the overall policy of managing the environmental quality of the Group’s assets throughout their life cycle. For more information on the Group’s EMS see section 5.2.1 Environmental Management System.

2.2.2 Green leases and tenant commitments

Since 2016 a clause has been added to the first version of Green leases which includes, in particular, the obligation to sign a supply contract guaranteeing that electricity is procured from renewable sources. This clause was updated from the green lease clause which has been included in all standard new lease contracts since 2017. This initial policy of promoting “Green leases” already aimed at improving tenants’ ESG performance during the operation phase through a set of requirements, including fit-out, operation and reporting requirements. The approach continues to be based on dialogue, information, and sharing of best practices, encourages the tenants to play a role in the environmental performance of the assets which they occupy. As well as contributing to lower operating costs through decreasing energy and utilities consumption and improving waste management, this change in behaviours is helping the Group and its stakeholders to prepare for increased constraints on resource management (regulation, availability, etc.). In that respect, already since 2017 and ahead of all existing regulations, all new leases and renewals signed with tenants have had environmental clauses. These first versions of Green leases cover those aspects that are most relevant to improve tenants’ environmental behaviours and performances, such as commitment to sharing energy consumption data, commitment to reviewing ways to improve energy efficiency and reduce net dependency through photovoltaic developments, and intention to discuss measures to save energy and water and sort waste. Indeed, meeting the Group’s reduction target of its carbon footprint from operations requires strong involvement of tenants, given the scale of their electricity use (see Section 5.1.1 Carbon assessment). To accomplish this, the two Group levers of improving energy efficiency and transitioning to renewable energy sources are implemented across the portfolio, in cooperation with the tenants. The table hereafter shows the penetration rates of the latest applicable green lease version across the Group assets, both for standing assets and pipeline projects. The penetration rate of green leases signed in 2023 is 90.6% Group-wide.

Green lease clause 2023	Number of new lease contracts signed with green lease clause	% of rental income of total new leases signed during the year	% of green leases among total active leases at year end
	48	90.7%	23.3%

Tenants are also being onboarded on the topic of responsible resource consumption through the organisation of periodic on-site reviews, during which environmental performances of an asset are presented and discussed with the tenants, to raise awareness and encourage behavioural changes as well as the implementation of operational improvements.

2.2.3 Energy management

The Group targets, in its ESG strategy, to improve the carbon emissions caused by the tenants’ usage of its warehouses by 27% by 2030, compared with a 2020 baseline. As part of its operational management process of environmental performance, the Group measures improvements in its energy efficiency by tenant industry segment against these targets: progress and results are disclosed in Section 3.1 Summary of the Group’s ESG achievements. To reach its targets in terms of energy efficiency, the Group has formalised a dedicated energy management policy, whereby assets are required to define their energy management action plan, setting the operational path towards reaching the objective, with levers identified at country as well as asset level to improve energy efficiency and their gradual implementation schedule. This policy also underlines energy optimisation best practices and sets the approach to define renewable energies action plans as well as sets requirements on green electricity purchasing. As a result, in 2023 the following steps have been taken:
— green clause in new lease contracts has been updated to include a green electricity procurement requirement to tenants (see section 5.2.1 Green leases and tenant commitments),
— implementation of a new group-wide energy consumption and production monitoring system (see section 5.2.3.1 Energy consumption – portfolio),
— advancement of the roll-out of smart meters (see section 5.2.3.1 Energy consumption – portfolio),
— the application of local renewable energy subsidiaries for status as a regulated energy trader to be able to more effectively offer green electricity to our tenants (see section 5.2.1.3 CRREM retrofit and improvement actions), and
— investments in the existing portfolio to improve energy efficiency (see section 5.2.3.1 Energy consumption – portfolio).

2.2.3.1 Energy consumption

Energy consumption data have been quality reviewed as well as carbon emissions calculations presented below have been third-party validated by CO2Logic based on GHG protocol and compliant ISO 14064.

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2.2.3.1.1 Energy consumption – own organisation

Energy Data	2019	2020	2021	2022	2023	% change YoY
Gas (GJ)	166	187	293	404	462	15%
Grey Electricity (MWh)	276	286	244	—	—	—
Renewable Electricity (MWh)	135	130	191	380	478	26%
Fuels (diesel and gasoline) GJ	23,226	15,164	12,880	13,846	13,508	-2%
E-Charging (MWh)	n/a	n/a	13	21	76	264%
Total energy GJ	24,386	16,848	13,905	15,693	15,963	2%
Total energy MWh	6,774	4,680	3,863	4,359	4,434	2%
Total energy consumption per FTE (MWh/FTE)	33.9	19.4	13.2	12.4	11.8	-4%

Energy consumption efficiency of the Group’s own operations has undergone significant changes over the course of the last 5 years. Whilst the organisation has grown from 770 employees at the start of 2019 to 815 employees in December 2023, the total energy consumption per employee has decreased over the same period by 65% to an average energy consumption of 11.8 MWh/FTE. This is predominantly driven by a shift to more clean and efficient gasoline powered vehicles and plug-in hybrid vehicles and since 2021 to full battery-powered vehicles. Since FY2021 the Group has switched to renewable electricity for the use of its own offices. The impact of this switch is discussed in the Carbon Assessment (section 5.1.1). As of 1 January 2023, a pan-European power purchase agreement (PPA) went into effect allowing the entire VGP office portfolio to switch to renewable electricity. The PPA purchases renewable electricity from the 6.5MWp photovoltaic installation on VGP Park Roosendaal and makes this green electricity available to the various entities within the Group across its operations– either by delivering this electricity directly or through the transfer of the green certificates of origin.# CORPORATE RESPONSIBILITY REPORT

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Energy consumption – portfolio

Optimisation strategy

The energy consumption optimisation strategy for the portfolio is built upon selective eco-efficient retrofits, green leases, energy management and renewable energy policies based on the following pillars:

• Daily optimization of operations. Digital technology and changing consumer expectations have set the stage for new solutions. A key development in 2022 has been the deployment of Deepki energy optimization platform across the countries of operations. Deepki facilitates emissions monitoring and management to reduce the carbon footprint of real estate assets
• Technical improvement of the equipment, including retrofit from gas-powered heating to electrical heat pumps, installing smart meters and LED lighting at refurbishment
• Offering renewable energy solutions to our tenants, including tailor-made roof-fitted photovoltaic installations for self-consumption and off-site green energy contracts offered through our own energy trading activities leveraging photovoltaic installations elsewhere in the group
• Improving the intrinsic quality of our new developments, including the installation of heat pumps instead of gas-powered heating as standard where feasible

Annual portfolio energy consumption reporting

In order to be able to more accurately assess energy efficiency improvements as well as compare year-over-year changes in energy consumption it is important to understand the actual tenant activity. The table below reflects the utility data for the VGP portfolio over FY2022. The classification system used is aligned with the GRESB segment reporting. The majority of our buildings have a logistics, non-refrigerated usage with limited to no manufacturing activities (classification “Industrial non-refrigerated warehouse”). For assets where manufacturing activities do take place (classification “Industrial: manufacturing”) the electricity and water consumption is typically 2.7x as much and gas usage 7x higher. A warehouse for logistics purposes but with cooling facilities typically performs in between these two categories (see table below for details). The classification office (“Office: Corporate: Low-Rise Office”) is only used for those buildings which have a dedicated pure office usage. For offices inside warehouses no separate consumption is reported (consumption is included as part of the warehouse data).

VGP extrapolates known data for the reporting year to ensure completeness and provide a more accurate carbon intensity figure. Due to current data collection processes, it is not always possible to collect a full 12 months of data from all the tenants and estimation is required using extrapolation techniques. Data coverage for 2021 utility data is 93% for electricity, 92% for fuel and 90% for water. For 2022 not all utility bills have yet been collected and at date of publication of this report the data coverage is 96% for electricity, 96% for fuel and 97% for water.

Utility consumption in portfolio (split by segmentation according to GRESB)

Property occupational use (GRESB)	Number of assets	Gross floor area (m²)	Electricity consumption (kWh/m²)	Fuel consumption (kWh/m²)	Water consumption (litre/m²)
			Average	Median	Average
Industrial: Non-refrigerated Warehouse	133	3,045,188	17.29	14.09	8.40
Industrial: Refrigerated Warehouse	18	394,371	66.00	62.15	15.27
Industrial: Manufacturing	62	1,369,468	102.32	38.01	14.31
Office: Corporate: Low-Rise Office	3	79,387	54.38	46.86	n/a
Other: Parking (Indoors)	3	55,123	6.55	7.93	n/a
Total	219	4,943,537	45.20	16.97	10.36

¹ See Appendix A of the GRESB reference guide – The GRESB property type structure follows a three-level hierarchy where a Property Sector is composed of multiple Property Types, further refined into multiple Property Sub-Types. The Property Sub-Type (level 3) is used for benchmarking purposes (https://documents.gresb.com/generated_files/real_estate/2022/real_estate/reference_guide/complete.html#property_types_classification)

• Green lease contracts – annual consumption and efficiency improvement review
• Installing heatpumps instead of gas- powered heating
• Offer renewable energy through roof- fitted photovoltaic installations
• Retrofitting of standing portfolio

---

Average Energy & GHG intensity per country and asset class

Country	AT	CZ	ESP	DE	HU	IT	LAT	NED	PT	RO	SK	Total
Standing and Completed portfolio	3	49	21	90	12	7	4	6	3	15	9	219
Data coverage	84%	98%	83%	41%	82%	100%	100%	100%	100%	94%	96%	68%
Industrial: Non-refrigerated Warehouse
Energy intensity (kWh/m²)	19.2	25.6	23.2	21.8	26.5	35.1	40.5	18.5	9.4	50.6	27.5	25.7
Carbon intensity (kgCO2 eq/m²)	3.6	10.1	3.2	7.2	5.9	10.1	6.3	5.6	0.0	16.0	4.9	7.5
Industrial: Refrigerated Warehouse
Energy intensity (kWh/m²)	n/a	109.6	78.5	65.6	177.4	n/a	n/a	80.8	n/a	70.8	n/a	81.3
Carbon intensity (kgCO2 eq/m²)	n/a	51.7	11.8	26.2	43.4	n/a	n/a	14.3	n/a	17.4	n/a	26.2
Industrial: Manufacturing
Energy intensity (kWh/m²)	36.6	244.1	132.8	34.2	175.3	n/a	67.0	n/a	n/a	86.6	88.7	116.6
Carbon intensity (kgCO2 eq/m²)	4.4	123.7	24.1	14.0	42.0	n/a	11.2	n/a	n/a	27.3	15.9	49.8
Office: Corporate: Low-Rise Office
Energy intensity (kWh/m²)	n/a	n/a	n/a	55.9	n/a	38.2	n/a	n/a	n/a	n/a	n/a	54.4
Carbon intensity (kgCO2 eq/m²)	n/a	n/a	n/a	26.5	n/a	10.1	n/a	n/a	n/a	n/a	n/a	25.2
Total
Energy intensity (kWh/m²)	26.6	149.0	43.5	29.2	109.7	35.3	47.6	34.7	9.4	56.2	51.4	55.6
Carbon intensity (kgCO2 eq/m²)	6.9	185.6	9.0	17.9	59.3	10.9	10.4	10.6	0.0	21.3	15.1	34.0

Energy consumption within the portfolio

Total energy consumption – portfolio (MWh)

	FY 2020	FY 2021	FY2022	FY 2023	% change YoY
Total renewable energy produced on-site	14,894	24,156	27,662	50,712	83.3%
Of which renewable energy consumed on-site ¹	3,646	3,858	4,539
Green energy purchased from grid	—	4,169	9,610	4,672
Total green energy consumed ¹	7,815	13,468	9,211		(31.6)%
Total grey electricity purchased from grid	137,501	161,904	214,345	214,727
Total electric energy consumed ¹	138,412	169,719	227,814	223,938	(1.7)%
KWh/m²	57	55	53	45
Kilo CO2/KWh	0.37	0.31	0.33	0.42
Grey electricity emissions (tCO2)	50,871	53,435	75,806	94,295	24.4%
Gas – Total fuel consumed from grid	83,695	73,643	58,281	51,805	(11.1)%
KWh/m²	34	24	14	10
Fuel emissions (tCO2)	15,499	13,624	10,782	9,584	(11.1)%
Total energy consumption	222,107	243,362	286,095	275,743
KWh/m²	91	79	67	56
Renewable Energy: produced and sold to grid	13,983	20,510	23,804	46,173	94.0%
tCO2 “elsewhere avoided” (scope 4) ¹	4,305	6,314	7,328	19,442

¹ Assuming the same carbon intensity as the average VGP-weighted carbon intensity for grey electricity for the year

Like for like energy consumption

	FY2020	FY2021	Change YoY	FY2021	FY2022	Change YoY	FY2022¹	FY2023	Change YoY
2020 base year
Electricity	110,638,126	118,137,794	6.8%
Gas	37,465,023	37,585,975	0.3%
2021 base year
Electricity		146,376,023	158,234,854	8.1%
Gas		52,036,372	43,533,754	(16.3)%
2022 base year				164,547,921	171,132,099	4.0%
Electricity							46,258,518	37,300,737	(19.4)%
Gas
Energy intensity (kWh/m²)	74.25	73.41	(1.1)%

The energy consumption both in absolute level as well as intensity have decreased in FY2022 compared to FY2021. The overall energy intensity of the comparable assets decreased by 1.1% year over year. Particularly the gas consumption in the portfolio has decreased (19.4% like-for-like YoY). The decrease in the consumption of gas is supported by the implementation of the heat pump instead of gas-powered heating and by a general consciousness and willingness to reduce gas consumption due to price volatility. Electricity consumption remained relatively stable – slight decrease (1.7%) in total consumption and increase in like-for-like consumption (8.1%). The electrification in general and heat pumps particularly are contributing to increasing electricity consumption. Low energy consumption in the buildings delivered in 2022 also contributed, as well as impact of classification of buildings without energy consumption data available – the effect of classification is visible in table “Energy and GHG Intensity per country and asset class”. The initiatives to invest in moving sensors in tenants’ offices, refurbish existing portfolio through a switch towards LED-lighting and smart metering investments are well underway and are expected to help reduce like-for-like electricity consumption (see section 4.2.3 Green leases and tenant commitments for additional details and section 6.3.5 Current allocation of green bond proceeds for further financial information on this initiative).

Renewable energy procurement and production

Renewable energy procurement

Following the transition of the Group’s own offices to 100% renewable energy as of 1 January 2021, the Group is aiming to accelerate the transition of its tenant-controlled energy contracts towards sourcing electricity derived from renewable sources (“green electricity”). In Germany, the Group started to provide own produced green electricity or alternatively green electricity purchased from wind farms through PPA contracts since 1 January 2022, as a result for all German assets for which VGP is contractually in control of energy delivery are all transitioning towards green electricity, in first instance this will transition circa 5 GWh, or 2.3% of total electricity consumption, from grey to green electricity. A similar model will be introduced in Romania later this year and other countries will follow. Since 2022 lease contracts signed with tenants include an updated green lease clause requiring tenants to procure green electricity for their operations.# COMMITMENTS

VGP recognized as first real estate company in Germany to receive the status of a regulated energy supplier

Magdeburg, Germany / 27 January 2023

At the inauguration of Germany’s second largest single-roof solar system at VGP Park Magdeburg-Sülzetal, Prof. Dr. Armin Willingmann, Deputy Prime Minister of the state of Saxony-Anhalt and Minister for Science, Energy, Climate Protection and the Environment and VGP CEO Jan Van Geet came together to recognize the achievement of obtaining a regulated energy supplier status which enables VGP to allocate green energy more efficiently to the needs of its tenants and on a national scale throughout Germany. The initial implementation of the green electricity contract involves 73 German assets supplied with green PPA for an estimated annual volume of 5 GWh.

Prof. Dr. Armin Willingmann, Deputy Prime Minister of the state of Saxony-Anhalt and Minister for Science, Energy, Climate Protection and the Environment and VGP CEO Jan Van Geet on the roof of VGP Park Magdeburg-Sülzetal. The single-roof solar system measures 10.27 MWp

CORPORATE RESPONSIBILITY REPORT 2023

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As such, the Group targets, as part of its ESG strategy, to:

• Multiply its installed capacity of on-site renewable energy by 10, compared to 2020 and offer the energy generated preferably to tenants at attractive terms;
• Source 100% electricity from renewable sources for those assets the Group is in control; and
• Intensify the green lease campaign with older lease contracts being adjusted to the 2023 version of the green lease contract (requiring green electricity procurement).

The share of renewable electricity in the overall tenant electricity consumption was 5% in 2021 and 7% in 2022. Including the self-consumption PV pipeline projects the share of renewable electricity consumption in 2022 would increase to 13%. The tenant portfolio will gradually tran-sition to green electricity procurement at the latest upon the inclusion of the enhanced green lease clause at contract renewal.

Production of renewable energy

Since 2010, the Group has been rolling out a solar photovoltaic installation program across its port-folio to generate electricity on site. The installed capacity of the Group’s systems has continued to increase. In 2022, new solar panels were installed across the portfolio. In total, there are 57 solar panel installations operational across the portfolio. The total installed renewable energy capacity of the Group’s assets in 2022 is 101.5 MWp (compared to 94.5 MWp at Dec 2021) with a further 32 projects with a power of 25.8 MWp under construction and 54 projects, with 55.6 MWp power, in pipeline projects.

The renewable electricity produced by the Group is either self-consumed to meet our tenant’s energy needs or sold to the grid. In FY2022, the total solar energy production equalled 13% of total electricity consumed but once the photovoltaic projects currently under con-struction are fully operational the solar power production capacity will equal 25% of total electricity consumption. Once the target of PV projects is considered the additional renewable energy gen-erated equals 30% of total electricity consumed. This would in theory mean that VGP should be able to operate all tenants at 100% renewable electricity however due to discrepancy in time (when solar power is generated vs when tenants consume energy) and location (some parks have more photovoltaic installation than needed for their tenant consumption, others less) the dependency on external renewable energy delivery contracts will remain imperative. Furthermore, due to con-tractual obligations (some tenants may prefer to continue to use an existing grey-energy providing utility) the Group within its portfolio is expected to continue to consume grey energy for the fore-seeable future, with on-site produced renewable energy sold into the grid instead.

The total on site production of renewable electricity at the Group’s assets and breakdown between energy sold and self-consumed is as follows:

1 Includes the envisaged production of VGP Park Moerdijk which has been sold after YE2022

Renewable energy produced as % of total electricity consumption
Renewable energy production (GWh)	-120	-100	-80	-70	-60	-40	0	-20	2020	2021A	2022A
B
C
D
	2021	2022	2023	2023 incl. U/C projects	2023 incl. pipeline	1 Target	0	50	100	150	200
B Annualised production of assets operational and under construction
C Annualised production of assets operational under construction and in pipeline
D Annualised production based on 300 MWp 2025 target
Self consumption
Grid injection
Total Electricity consumption all tenants FY2023

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Renewable energy production (MWh)	Self-consumption	Grid injection	Total
2021A	3,646	20,510	24,156
2022A	3,858	23,753	27,611
2023A	4,539	46,173	50,712
Annualized production of assets operational and under construction	51,640	101,016	152,656
Annualized production including projects in pipeline	62,039	183,319	245,358
Annualized production based on 300 MWp 2025 target	260,000

PV roll out (KWp)	Country	Existing	UC	Pipeline	Sub-total
	Austria	0.0	0.0	2.6	2.6
	Croatia	0.0	0.0	0.0	0.0
	Czech Republic	0.0	3.8	0.4	4.2
	France	0.0	0.0	12.1	12.1
	Germany	78.1	58.0	55.1	191.3
	Hungary	0.0	0.0	0.6	0.6
	Italy	0.5	5.1	9.7	15.3
	Latvia	0.0	0.0	0.5	0.5
	Netherlands	22.5	0.0	9.0	31.5
	Portugal	0.0	0.0	0.2	0.2
	Romania	0.1	2.0	1.6	3.7
	Serbia	0.0	0.0	1.2	1.2
	Slovakia	0.0	0.0	1.5	1.5
	Spain	0.6	0.0	5.1	5.7
	Total	101.8	69.0	99.7	270.5

5.2.5 Decarbonisation scenarios (CRREM)

The Carbon Risk Real Estate Monitor (CRREM), an EU-funded research project established in 2017, is helping real estate owners like VGP understand the financial risks to our portfolio in relation to various decarbonisation scenarios. Since 2018, VGP has conducted an annual CRREM analysis of its entire portfolio in order to understand stranding profile of the various sub-portfolios across countries and analyse improvements scenarios, including energy efficiency operations, switch to electric heating (heat pumps) instead of gas-powered heating and optimisation of investments into renewable energy production facilities.

The latest CRREM as conducted in 2022 was completed based on the following assumptions:

• Results based on CRREM Tool v 3.0.0 (as published 15 April 2022)
• Results are based on actual energy consumption data of VGP portfolio over FY 2021
• For those assets energy consumption data is not available for full year the results are based on extrapolation
• Extrapolations and GHG factors obtained limited assurance from auditor review
• Buildings under construction have been excluded
• Grid consumption and injection has been adjusted for current photovoltaic projects under construction and annualized contractually agreed renewable energy consumption by ten-ants based on the assumption that only 40% of energy can be provided for by photovoltaic (simultaneity analysis of production vs consumption)

Based on the FY 2021 reported utility data only 5% of the portfolio is above the pathway with a projected stranding year of 2030. If the 2023 planned photovoltaic roll-out is completed the portfolio, based on gross asset value, is majority 1.5°C-compliant until 2040, with a GHG strand-ing year of 2033.

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CORPORATE RESPONSIBILITY REPORT 2023

5.2.5.1 CRREM retrofit and improvement actions

Several portfolio improvements effect on the stranding year have been analysed further:

• Since 2011 the Group invested significantly in energy saving LED lighting, heat pumps, mov-ing detectors and sun protection for offices and smart meters.
• Since 1 Jan 2021, implementation of the green electricity contract for 73 German assets sup-plied with green PPA for an estimated annual volume of 5 GWh which is effective.
• No more gas powered heating with effective refit of existing portfolio gas heating installa-tions (replaced with heat pumps): 1.5°C-pathway stranding year improves to 2037
• Green energy procurement requirement in new or renewed lease contracts: a majority of portfolio assets is 1.5°C-compliant until 2030 and GHG compliance improves to 2033 (no effect on energy intensity). The portfolio will gradually improve to this score over time as new contracts are signed or existing contracts are being renewed
• Combination of all measures, results in a portfolio which is fully GHG 1.5°C-compliant

CRREM– stranding year	2022	2023
GRESB submission (based on actual renewable energy production in reporting year)	2027	2029
Based on renewable energy contracted projects	2040	2033
1 Implementation of all retrofit and portfolio improvements actions	1.5°C-compliant

Improve buildings’ energy efficiency

Since 2011 the Group invested significantly in energy saving LED lighting, heat pumps, mov-ing detectors and sun protection for offices and smart meters. These refurbishments and new investments in 105 buildings have amounted to ca. € 17 million in spending. These investments have resulted in energy consumption savings amounting to 3.5 GWh or 1.27 tCO2.

	2023
Avoided energy consumption (MWh)	35,317
Emission factor (tCO2/MWh)	0.058
Avoided emissions (tCO2)	2,054

Since 2011, the energy action plans are also integrated in the CRREM Group portfolio analy-sis.# COMMITMENTS

Heat pumps roll-out and retrofit

The Group has implemented a new construction policy for heat pumps as standard means for heating (as opposed to gas powered heating) since the beginning of 2022. As of today circa 17% of assets has heat pumps installed and circa three-quarter of the portfolio still use gas powered heating. For these assets to be converted to air heat pump based heating system a total investment of circa € 70 million would be required.

Green energy procurement and VGP as regulated energy provider

The Group is since 1 January 2021 a regulated energy company in Germany. The Group is soon expected to receive a similar status in Romania. In these markets the Group will be able to use its own photovoltaic installations to supply green electricity to its assets, albeit applicable only for those assets where VGP is controlling the energy procurement or for those assets where tenants decide to participate. The implemented PPA in Germany results in effected assets becoming 1.5°C-compliant and the overall portfolio 1.5°C-pathway stranding year improving by circa 8 years once all German assets (for which VGP delivers energy) are fully electricity provided for through the aforementioned PPA. Furthermore, based on lease contracts expirations with renewals and new leases containing the Group green lease clause the overall portfolio will over time shift to only green energy procurement. The green lease clause and energy provider status have thus far not been required for capex investments although though require ongoing operational support by facility– and renewable energy management.

Improve EPC Class and align with near zero energy building (NZEB) standards

For new construction the Group aims to comply with the EU Taxonomy requirements for energy performance. The EU Taxonomy for the construction, acquisition and ownership of buildings refers to Energy Performance Certificates (EPCs) as per the Energy Performance of Buildings Directive (EPBD). For the reporting of alignment of assets to EU Taxonomy, it is needed to refer to the near zero energy building (NZEB) standards and EPC schemes based on the divergent primate energy demand (PEB) thresholds as determined by each of the country’s where those assets are located.

For new buildings (or buildings constructed since 1 Jan 2021), the criterium is to build assets with an PEB of NZEB minus 10% and with an EPC in place. For buildings built before 31 Dec 2010 the building needs to have an EPC Class A or 10% top performing building. In case of a substantial contribution to climate change adaptation or a circular economy¹ an asset needs to comply with the Do No Significant Harm to climate change mitigation by PED performance of NZEB and for buildings built before 31 December 2010 with an EPC Class C minimum or 70% top-performing buildings.

With regards to the existing portfolio, based on the Group’s pipeline PV projects the majority of the EPC ratings of our portfolio will improve to either EPC A or EPC B. For those assets for which this is not the case further investments in energy efficiency and renewable energy production will be required. Based on portfolio assessment an investment of circa € 30 million will be required to achieve a minimal EPC B rating in all buildings. As for most of these assets the final improvement could be achieved through additional PV investments this could also be economically yielding investments.

For more general information on the implementation of EU Taxonomy and the EPBD please refer to the factsheet available on www.epra.com.

¹ No substantial contribution criteria for a circular economy for the acquisition and ownership of buildings
² https://www.epra.com/application/files/7515/9657/8837/EPRA__WGBC_Factsheets_on_the_EU_Taxonomy.pdf

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3.3.1 Water management

The non-financial risk assessment pointed out that water is not a key environmental issue for VGP. Indeed, the tenants within the Group’s portfolio are not considered as being significant water consumers. Nevertheless, VGP acknowledges water as a fundamental resource and upholds the right for everyone to have fair and equitable access to it.

Water consumption at the Group’s assets is driven by the occupational tenant usage of the asset and predominantly driven by the number of employees. For further information on the split of the water consumption per tenant segment type, please refer to table “Utility consumption in portfolio (split by segmentation according to GRESB)” in the section 3.3.3.3 Energy consumption – portfolio of this report.

Water consumption within the portfolio is concentrated to a number of large consumers with the top 10 tenants accounting for 85% of total water consumption, typically related to manufacturing and warehouses using cooling facilities. Whilst focus on water consumption improvement at these sites will be most effective, reducing water consumption is an operational target at all parks as part of the Group’s resource efficiency policy and is tracked and managed at asset and Group levels.

Based on environmental best practice, the Group is taking active steps to limit water consumption, reduce water waste and maintain water quality. Special efforts are made to install water-efficient equipment. The group is in the process of analysing the implementing of a real-time monitoring tool that allows to detect leaks so to ensure these can be repaired rapidly. Water monitoring is a key focus for the Group, which also started rolling out water connected submeters in new developments. Additionally, aerators and other low-flowrates water features have been implemented in assets in accordance to BREEAM requirements. As a result, water and cost savings were achieved. In addition to this impact, in order to avoid irrigation need as much as possible drought tolerant landscaping is implemented both in terms of flora selection as well as water retention ability.

Since 2021 circa €7 million was invested in water-saving measures. For new developments and refurbishments, the following standards are used across the portfolio:

• wash hand basin taps and kitchen taps have a maximum water flow of 4 litres/min;
• showers have a maximum waterflow of 7 litres/min;
• WCs have a full flush volume of a maximum average flush volume of 4.5 litres;
• Urinals use a maximum of 1 litre/bowl/hour. Flushing urinals have a maximum full flush volume of 1 litre

To optimise water use and leverage-associated cost savings, the Group also prioritises the use of non-drinkable or reused water over drinkable water wherever possible. In 2023, in total 170,500 m³ of rainwater could be collected on site for cleaning and for watering green spaces.

At existing parks, the Group relies on a close cooperation with tenants to reduce water consumption. Green leases (see section 3.3.2 Green leases and tenant commitments) and tenants’ discussions on site are used to help raise awareness among tenants about water use and to get them on board with water management.

In 2023, water consumption in our parks, including water used for vegetation, increased by 21% compared with 2021 due to growth of the overall portfolio and more rainwater being retained and used in our parks. On a like-for-like basis grid water usage decreased year-over-year by 13% and grid water usage intensity decreased by 8% year-over-year, reflecting the effect of more water saving measures (in compliance with EU Taxonomy “Do No Significant Harm”– requirements) being deployed at new developments and refurbishments.

Water (cubic metrics)	FY 2020	FY 2021	FY 2022	FY 2023	Change YoY
Average grid water consumption (litre/m²)	93.0	82.8	83.6	78.9	(6)%
Total water consumed from water grid	179,917	256,000	365,000	385,766	5%
Total water collected and re-used on site	n/a	n/a	105,000	180,800	72%
Total water consumed/collected	179,917	256,000	470,000	566,566	21%
Like-for-Like comparison– 2023/2022	255,163	221,793			(13)%

3.3.2 Waste management

VGP’s waste management approach is designed to maximise recycling and minimise disposal to landfill. In order to manage waste most effectively the Group has tailored its approach and waste management targets to the three main waste generating activities, own operations and offices, at construction sites and in the standing asset building portfolio.# IMPROVE ECO-EFFICIENCY

3.3.3 Waste management of own operations

Waste: own organisation

Waste (metric tonnes)	FY 2022	FY 2023	Comment
Total waste recycled/reused	1.4	1.2	(1)
Total waste disposed	0.5	0.6	(2)
Total waste	1.9	1.9	(3)

(1) Waste emissions for FY 2022 are mainly calculated based on an extrapolation of data from offices with known data.
(2) Total waste emissions are 19.4 tCO2e, or 0.17% of total emissions. 55% of waste emissions result from residual waste, paper waste caused 1% of waste emissions and 14% of waste generation.

Since 2011, the Group has a Green Office Policy in place which is focused on waste reduction opportunities based on the revised EU Waste Framework Directive (Directive 2008/98/EC) which sets out five steps for dealing with waste, ranked according to environmental impact – the “waste hierarchy” – with a first and most important focus on prevention and secondly prepare for re-use. By implementing these strategies the Group is able to reduce waste of its office operations. Since the implementation of the policy the amount of printed documents has significantly reduced, whilst paper was previously predominantly recycled, the overall waste reduction has reduced the waste production intensity significantly in-line with the waste hierarchy. The amount of waste not recovered is including residual waste for which the incineration or recycling process has not been confirmed, as a result the current number is likely conservative. Furthermore, precise data collection will improve this metric further.

PREVENTION
If you can’t prevent it then…

RECOVER OTHER VALUE
If you can’t recover value (e.g. energy), then…

RECYCLE
If you can’t recycle, then…

PREPARE FOR RE-USE
If you can’t prepare for re-use, then…

DISPOSAL
Landfill if no alternative available

3.3.4 Waste management at construction sites

While waste generated across our own offices (where we have control) is monitored, tracked and reported (see table below), the majority of our waste is created as a result of our construction and demolition projects. We aim for 90% of non-hazardous construction and demolition waste generated on construction site to be prepared for reuse, recycling and other material recovery, including backfilling operations using waste to substitute other materials, in accordance with the waste hierarchy and the EU Construction and Demolition Waste Management Protocol. As such, for demolition waste, which makes up the bulk of our total waste, we re-use as much as possible on-site to avoid the carbon emissions related to transportation of waste off-site and the import of new materials from elsewhere. We undertake pre-demolition audits to identify waste materials taking into consideration the quantity and quality of waste to be re-used on site as aggregate. We also re-use on site where materials are non-hazardous and will not have a detrimental effect on the environment. Hazardous waste is treated differently and is not included within these figures. Hazardous waste is dealt with in the appropriate manner, fully in line with relevant regulation.

Waste generation construction sites (metric tons)

FY 2023
Reported construction waste	5,519
Hazardous waste	188
Recycled waste	4,428
Recycled waste as percentage of total construction waste	80.2%

For more information on the compliance with the 90% recovery target per construction site per EU Taxonomy requirements please refer to section 3.2.1.3 Transition to a circular economy in construction projects.

3.3.5 Waste management of standing building portfolio

The Group has a limited impact on the total volume of waste generated in existing parks. Nevertheless, the Group is committed to waste management efficiency measures, such as increasing waste sorting, and raising awareness among tenants, as well as incentivising them to reduce the amount of waste disposed, and implementing innovative waste management solutions.

Improving waste sorting in collaboration with tenants

Suitable waste segregation facilities are in place in all assets and most assets are equipped with specific sorting facilities and treatment solutions for organic waste, which represents a significant share of the total amount of waste generated by the Group. Tenants are informed and made aware of the Group’s waste management policies and of the importance of sorting waste. This is via, for example, tenants’ on-site discussions and guidelines reminding tenants of what to do with different types of waste. Both supplier purchasing contracts and tenant Green leases establish the minimum requirements to be met for waste sorting and recycling. Tenants are requested to share details of tonnages collected by type of waste and recycling percentages achieved. Tenant education includes delivering tenant-level waste sorting guidelines to the facility management’ teams, sharing best practices, highlighting the importance of properly sorting material, and outlining the legal requirements associated with the waste management programs.

Waste: portfolio

Waste (metric tonnes)	FY 2023
Hazardous waste	809
Non-hazardous waste	30,204
Total waste produced	31,013

Like-for-like comparison

	2022 base year	2022	2023	% Change YoY
Hazardous waste		879	809	(8)%
Non-hazardous waste		1,690	1,624	(4)%

3.3.6 Develop connectivity and sustainable mobility

As part of its ESG strategy, VGP aims at ensuring access to public transport and sustainable mobility for the tenants and their visitors of our buildings. In addition, the Group only allows the use of battery-powered vehicles or plug-in hybrid vehicles for its own staff with respect to car portfolio leased and own. This is a cornerstone of the plan to reduce Scope 1 and 2 emissions by 40% by 2030 from a 2019 baseline (see Section 3.2 Address climate change). To further raise awareness of our tenants with respect to the green transition, the Group has introduced a target in 2022 of having 100% of parks equipped with EV charger units and to achieve the target of having 100% of Group assets offering sustainable means of transport. This engagement cascades down through the Group’s development pipeline, in which the Group in addition to the 100% public transport connectivity target (see section 3.3.7.1 Connectivity to public transport for further details) aims for parks to offer facilities for pedestrian (sidewalks where applicable) and bicycle usage promotion (bicycle lanes and racks). See Section 3.7 Summary of the Group’s ESG achievements for a summary of the Group results against these strategic targets. By making these commitments, the Group is setting a long-term view on the evolution of mobility trends by working both on asset attractivity and actively encouraging new sustainable transport solutions and behaviours by the employees of our tenants. The Group aims to facilitate our tenants in their transition towards a green (forklift-) truck/van fleet by offering green electric and hydrogen charging facilities and infrastructure at our park. In 2021 a pilot project was launched in Germany to offer EV charging facilities at the home of all VGP employees. The other countries within the Group will follow suit.

	FY 2022	FY 2023	Target
% of parks with EV charging facilities	46%	59%	100%
Number of associated parking spaces with EV charging	545

(1) Waste emissions for FY 2022 are calculated based on an extrapolation of tenant disclosed data (data coverage FY 2022 78% and 77% respectively based on floor area)

3.3.7 Connectivity to public transport

With regards to land selection criteria the Group is focusing on opportunities that are or will be well connected to public transport networks and are located close to major cities.

	FY 2022	FY 2023	Target
% of parks with public transport accessible	95.8%	97.3%	100%

For the remaining parks adequate solutions are being sought. In addition, the design team usually consults with the local authority on the state of the local cycling network and how the new park development could improve bicycle usage of the park users. When appropriate, the design team consults with the local community in selecting and implementing additional solutions to enhance access to the local bicycle network. At 2023 year-end, 99.6% of the Group’s projects are connected to public transport solutions.

3.4 Protect and improve biodiversity

In the existing parks a total of 1.18 million square meter of green surface is managed by VGP. The Group actively protects and improves the biodiversity value of these green surfaces specifically and its assets in general by assessing biodiversity impacts and mitigation measures in accordance with BREEAM Excellent/DGNB Gold level standards, and by implementing biodiversity action plans based on the Group’s Biodiversity Policy that account for unique local conditions. Ecologists and landscape architects are involved in design and development activities to guide architects and developers on existing ecosystems and selecting the best strategy to protect local wildlife. In order to assert compliance with EU Taxonomy for land acquisition the Group has enhanced its due diligence requirements.# PROTECT AND IMPROVE BIODIVERSITY

As a result, the Group predominantly focuses on brownfield development opportunities and aims to avoid new developments to be built on:

— greenfield land of recognized high biodiversity value and land that serves as habitat for endangered species (flora and fauna) as listed on the European Red List or IUCN Red List
— land matching the definition of protected forest as set out in the national law and used in the national greenhouse gas inventory

As well as minimize:

— the use of arable land and crop land with moderate to high level of soil fertility and moderate to high below ground biodiversity as referred to in the EU LUCAS survey

In addition to enhancement of green areas existing in VGP Parks (in the course of 2023, additional trees were planted in existing VGP Parks and initiatives undertaken to protect and enhance biodiversity), in 2023 eight biotope areas have been created within our parks under construction to enhance or protect specific species and enhance overall local biodiversity, this brings the total biotope areas to 25. The total size of these biotopes, created within VGP Parks measure 37,000 m².

3.2.1 Implementing Biophilic design

Whilst individual biodiversity improvement measures within our parks are increasingly implemented either as part of the design phase or during ongoing retrofits of the green spaces, a distinguishing feature of biophilic design is its emphasis on the overall setting or habitat and not a single or isolated occurrence of nature. When taking into account an integrated design, the ecosystem performs at a level greater than the sum of its individual parts.

3.2.2 Protection and restoration of biodiversity and ecosystems for development projects

In addition to the biodiversity due diligence as part of the land acquisition, all development projects with a biodiversity value need to implement a biodiversity action plan. This action plan is always prepared by a qualified ecologist after the assessment of the characteristics of the local biodiversity. Such assessment needs to be completed in accordance with the Group’s Biodiversity Policy. Where an assessment has been carried out, the required mitigation and compensation measures for protecting the environment are to be implemented. This assessment will help safeguard the Do No Significant Harm (DNSH) criterium under EU Taxonomy, and in cases of an substantial biotope investment assist in determining a potential significant contribution under the Taxonomy (of the biotope investment as a single measure). The purpose of project specific assessment is to first avoid and reduce all impacts of the project on the local nature, and second to implement on each project a list of Group recommendations like the use of environmentally certified materials or bird-friendly designs for the façades and biodiversity compensation zones and initiatives. The commitments and recommendations for the integration of biodiversity in development projects are integrated in the Group’s design process through the Sustainability Brief (see Section Project design and review stage in 4.3.3 Design sustainable buildings). Additionally, for some projects a broader Environmental Impact Assessment is conducted, which includes an environmental/biodiversity component, as it is a prerequisite for obtaining a building permit and commercial planning permission in some countries. A public consultation may also be carried out as part of this process. Biodiversity is also addressed by the development projects through the “Land Use and Ecology” section in the BREEAM certification and for all DGNB projects a biodiversity strategy is conducted. For example, the project VGP Park Laatzen, building A in Germany which achieved first of its kind DGNB Platinum certification achieved 100% of the 10 credits of that section, through a number of biodiversity initiatives including for example through the support of habitats for birds and insects, and a rainwater retention basin providing biotope for toads and other reptiles.

Biodiversity and ecosystems	% of projects started in 2023 with an ecology plan	Target of projects to have an ecology plan
	100%	100%

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PROTECT AND IMPROVE BIODIVERSITY

VGP Hungary looked to biophilic design principles to construct a tree-like installation covered in plants in the central area of new corporate offices in Budapest

Detail from the new VGP Building Standard

Details from VGP Park München with green roofs and green walls, as well as connecting green spaces and a significant biotope have been integrally designed

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3.2.3 VGP biodiversity strategy and taxonomy for existing parks

Although nearly all our parks are certified according to BREEAM or DGNB, which provides basic safeguards for restoration and protection of biodiversity, the Group developed an additional ecosystem enhancement safety measure. The implementation of this measure is driven by:

— the aim to align the portfolio with EU Taxonomy regulation, including the biodiversity and ecosystem protection criteria, as well as,
— our continuous improvement philosophy within the scope of the Group’s Environmental Management System (which has been based on ISO 14001 standards), and
— the Group’s Biodiversity assessment framework (see for more information the Group Biodiversity Policy available on the Group website 1)

As such additional priority improvement measures may be identified in existing portfolio and are already being implemented in three of the Group’s existing parks. For those parks, specific measures have been suggested for each based on local tailored ecology studies. This work is now underway in two of the three identified parks and works are expected to start in the third park in the course of 2024. The aim is to increase the use of “green” spaces, either through enhancing existing green structures into biotopes or through enhancements such as green roofs, green walls, green parking lots.

VGP biodiversity taxonomy for existing parks

Categorisation of biodiversity initiatives	Combined identified initiatives achieve a substantial contribution under EU Taxonomy Biodiversity and ecosystems criterium	Combined identified initiatives achieve DNSH under EU Taxonomy Biodiversity and ecosystems criterium	Specific ecologically tailored measures have been taken in order to enhance local ecosystems based on a biotope	Green roof or green façade	Other significant ecological mitigation measures
Less than 500 meters to natura2000 area and park adjacent to forest or asset location identified by municipality as of ecological importance	X		X	X	X
Less than 1,000 meters to natura2000 site and adjacent to arable land but not recognized as of high biodiversity value		X
Less than 500 meters to natura2000 site but plot itself only bounded by other semi-industrial sites		X
Less than 1,000 meters to natura2000 site or adjacent to arable land but not recognized as of high biodiversity value		X

In 2023, in existing VGP Parks 2,000 trees were planted to enhance biodiversity.

1 See: https:/vgpparks.eu/media/1538/vgp-biodiversity-strategy-a4-en-k23.pdf

An example of an existing park which is being enhanced is VGP Park Gyor Beta. Previously identified through the Group’s biodiversity monitor as a park with an outsized potential for additional yielding biodiversity initiatives an ecology study conducted in 2023 identified several improvement measures which are currently being implemented to enhance and protect the existing ecosystem, particularly along the southern border of the park which is adjacent to natural territory. See the case study on the following page for additional information.

The Group also works across its regions to raise awareness among its stakeholders and communities about the importance of biodiversity. For example, in 2022, through the VGP Foundation, the NABU campaign “Become an Insect Scout” during which nature enthusiasts and insect fans can apply for training in identification and ambassador role for insect care projects in the community.

	% of projects with meaningful biodiversity stakes implemented a biodiversity action plan	target % of projects with a high biodiversity stake implemented a biodiversity action plan
	95.7%	100.0%

The score improved 10% year-over-year and the aim is to achieve a 100% score by the end of 2024. Once a project has been built and delivered, the Group’s facility management team is responsible for maintaining and monitoring biodiversity. The ESG team monitors the application of the Group’s biodiversity policy and provides operating teams with the necessary support.

VGP Foundation and NABU initiative started in 2022 “Become an Insect Scout”

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An example of an existing park (building B was delivered in 2021) which is being enhanced as a result of the implementation of the Group Biodiversity Policy is VGP Park Gyor Beta. Identified through the biodiversity monitor in early 2023 as a park with an outsized potential for additional yielding biodiversity initiatives an ecology study was commissioned and conducted in the same year which identified several improvement measures. These measures are currently being implemented to enhance and protect the existing ecosystem, particularly along the southern border of the park which is adjacent natural territory. Signs in the park will highlight the various ecosystems present, the initiatives taken to protect these and explain the relevance of such measures to any visitors.# CORPORATE RESPONSIBILITY REPORT

COMMITMENTS

3.7 Empowering our workforce

Key figures

The group has 4,007 employees (3,845 FTE) as at 31 December 2023, and an average headcount of 3,906 people (3,730 FTE) for 2023.

Employment by Country (People)

	2022	2023
Germany
Czech Republic
Spain
Romania
Belgium
Hungary
Slovakia
Italy
Austria
Portugal
The Netherlands
Latvia
France
Serbia
Denmark
Croatia

Employment by Activity
* Technical/on site: 59%
* Commercial: 9%
* Support functions: 32%

Employment by age
* < 30 Years: 9%
* 30–50 Years: 70%
* > 50 Years: 21%

Employment by duration of contract

	2022	2023
Permanent	87.9%	89.4%
Fixed term	12.1%	10.6%

Employment by type of contract

	2022	2023
Full-time	92.2%	86.8%
Part-time	7.8%	13.2%

3.7.1 Attracting the best talent

VGP is committed to attracting the best talent by fostering professional development, promoting cross-functional and international mobility opportunities and offering exciting career opportunities at all levels. As we continue to focus on recruiting the best candidates we have also intensified our efforts in recruiting experienced profiles. Bringing new sets of capabilities and diversifying our leadership and management styles are key success factors for the Group. The VGP corporate LinkedIn page allows us to maintain our strong digital presence, increase our brand awareness, and build stakeholder relationships. Its audience grew by 12,000 in 2023 to reach close to 17,000 followers by December 2023. Besides stories on our business activities, our parks, and our people, among others, here the Group showcases content to promote our technical expertise, to highlight our ESG initiatives, and to demonstrate the activities to support the communities we are a part of.

3.7.2 Talent management

The Group is committed to offering employees a working environment that fosters diversity and equal opportunities to offer to each employee the experience needed to build an exciting career that creates value for the Group. Employees meet with their managers once a year for year-end evaluations, have the opportunity to provide and receive ongoing feedback throughout the year, which gives them the opportunity to discuss their performance, objectives, career advancement and training needs. Career evolution in the Company is strongly linked with the Group’s competency model (see Section 3.5 ESG Strategy: Building Tomorrow Today Together). The Group aims to recognise the experience and expertise employees are developing in their position. Internal mobility between functions is encouraged and is conceived as a collaborative process involving employees, country management and Group functions. It gives employees a more in-depth understanding of the Group’s various activities and priorities. International mobility also helps employees to build and consolidate networks and share best practices among the various countries.

Departures in 2022 by reason for departure

Turnover

	2019	2020	2021	2022	2023
Turnover rate	14%	10%	12%	13%	17%
Voluntary turnover				8%	12%
Unvoluntary Turnover				5%	5%

New hires

	2022	2023
New hire ratio	31%	19%

The new hire and employee turnover rates are calculated based on the total employee numbers at the end of the reporting period and expressed as a percentage or ratio. In 2023 we had a regrettable voluntary turnover, as measured by voluntary departures during the reporting period as percentage of the number of permanent employees at the end of 2023, of 12%. Our strong employee engagement survey results validate that our employees are motivated and engaged – see also section 3.7.4 Diversity for a further explanation of the employee survey results.

New Hires: Employment by duration of contract

Permanent		96%
Fixed Term		4%

New Hires: Employment by type of contract

Full-time		84%
Part-time		16%

3.7.3 Training

The year 2023 saw the inauguration of the VGP Academy, offering a stimulating learning environment through knowledge acquisition and skill development by offering business and soft skill training and resources available to all employees. In 2023, in total 2,490 employees followed a course organized by the VGP Academy. Groupwide and regional trainings are organised to embed the Group’s ESG strategy, ESG processes and to empower and encourage employees to deliver sustainable actions. The ESG ambition and related action plans are systematically introduced to newcomers in the “VGP new joiners” training. Dedicated technical training is offered to relevant staff members as required, covering topics such as sustainable consumption and the carbon footprint assessment methodology for development projects. Training materials related to new ESG topics are also drafted regularly, shared with the relevant teams, and made accessible on the Group’s training platform (for example “EU Taxonomy” and “Renewable Energy and Green Leases” guidelines). Also, for all technical managers across the Group, a symposium is held annually discussing potential improvements to our building standard in order to enhance circularity, ways to enhance the energy transition (including less usage of gas for heating and offering EV chargers) and the implications of EU Taxonomy. Last year the Group reported that, in response to 2021 employee survey results, further enhancements to the training program were to be reviewed and accessibility of training to be broadened. As a result the VGP Academy was introduced in 2023. Whilst employees did not yet have a full year benefit from the VGP Academy a notable improvement in appreciation for the Group’s training offering was noted to a total of 71.7% of employees expressing to be satisfied with the Group’s training platform – up 9.2% year-over-year. The Group’s employees are a critical pillar of the Group’s ESG strategy as it focuses on people topics including Diversity and Inclusion, and Employee Wellbeing. To embed the Group’s Diversity and Inclusion policy in the day to day operations, VGP has committed to 100% of Group employees to have participated in ESG training, in 2023 45% of staff participated in such training.

ESG training 2023

	% of staff trained on ESG topics in 2023	% target of staff to be trained on ESG topics
	45%	100%

3.7.4 Diversity

Employment by gender

	2022	2023
male	65%	63%
female	35%	37%

Employment by Age

	2022	2023
<30	8.5%	9.0%
30–50	70.1%	70.0%
>50	21.4%	21.0%

Diversity (gender)

	2022	2023
Board	60%	60%
Management	19%	20%
Company	35%	37%
EU Women on Boards guideline	33%	33%

Diversity (nationality)
* Nationalities working for VGP: 25

Diversity (parental leave)
* % of VGP employees entitled to parental leave: 100%

Diversity and inclusion form a key part of the Group’s ESG strategy. With a representation in 26 countries, VGP welcomes employees from diverse cultures and backgrounds to build successful and inclusive teams.

VGP commits to ensuring full equal opportunities (e.g. gender, nationality, sexual orientation) in HR practices and processes Group-wide. This target has been achieved as 100% of VGP countries ensure full equal opportunities in their HR practices and processes by having the VGP Equal Opportunity statement included in formalised HR policies relating to recruitment practices, compensation & benefits, talent review and learning & development. The VGP Equal Opportunities statement ensures that HR policy and processes are applied without discrimination on the basis of race, colour, religion, sex, sexual orientation, gender identity, marital status, age, disability, national or ethnic origin, military service status, citizenship, or other protected characteristics. In order to measure employee perception of the diversity and inclusivity policy in 2022 a new Group Employee Survey was introduced including questions with a focus on Diversity and Inclusion. In 2023, 3,109 employees participated in the survey, representing 79% of the workforce, with 74% of respondents stating that VGP is a socially responsible company. The survey will be rolled out each year to check in with the employee community and help shape effective plans to create an even more inclusive working culture.

VGP Diversity, Equality and Inclusion Strategy framework: In addition to the VGP Diversity Policy, since 2021 the Group has a Diversity, Equality and Inclusion Strategy to drive change within the organization and define actions across 7 key focus areas. The Strategy document is available on VGP corporate governance web portal and the plan is for the actions to be further detailed over the coming period.

3.7.5 Gender Pay Gap

We believe that analysing diversity data and being transparent is an important step towards creating meaningful change. This is why we have decided to voluntarily publish our Gender Pay Gap. In 2023, our Gender Pay Gap for all employees at VGP was 42%.

Gender Pay Gap

	2022	2023
Pay Gap for VGP Group	42%	42%

Like many other organizations, particularly in the property sector, the reason for our Gender Pay Gap is the fact that we have more men than women in senior roles.# In VGP, our employees are paid equally for doing equivalent jobs across our business and our reported Pay Gap is a direct result of our employee profile and does not represent pay discrimination. A core element of our ESG strategy is to improve the diversity of our business. The new Diversity Strategy document as published last year will further help amplify the importance within our organisation at all levels of seniority. This is crucial for the enduring success of our business but should also be reflected in reducing the Pay Gap over time.

Employee commitments and ESG

Individual ESG objectives

The Group has committed to 100% of employees having yearly individual ESG objectives to help make all employees accountable for the collective success of the ESG ambition. Appropriate initiatives and targets aligned with the Group’s ESG Strategy are being identified in close coop- eration with each country within the Group and functional departments: Technical, Commer- cial, Land Acquisition, Facility Management, Property and Asset Management, Finance, Mar- keting, Legal and Compliance. A toolkit with key examples of general and functional ESG targets is shared with VGP employees Group-wide.

Our actions Building Tomorrow Today TogetherOur purpose
1. People and culture
3. Our leadership
4. Our suppliers
5. Our communities
2. Recruitment and career progression

A diverse and inclusive workplace where people can achieve their full potential

Our people Make a positive difference to colleagues, communities, our suppliers and clients by taking action to promote equality – considering all areas of diversity

Our DEI strategy

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Quantifiable ESG targets are included in the incentives of members of the Group’s manage- ment team. Further details are presented in the Group’s Corporate Remuneration Report. The 2023 incentive awards also include 30% of ESG-related performance conditions, for all eligible Group employees.

Volunteering program

The VGP Volunteering Program offers all employees the opportunity to dedicate at least one workday per year to support social initiatives developed by the Group including support for local people facing barriers to the job market or supporting local non-profits through VGP Com- munity Days and local partnership activities. Since 2019, the Group has committed to 100% of Group employees taking part at least one day per year in the VGP Volunteering Program. The Group’s community-oriented activities in 2023 were focused on supporting the needs of local communities and events to support and enhance local biodiversity. More information on the results of these initiatives is included in Section 5.3 VGP in the community.

Business travel

The Group travel policy aims to reduce its associated carbon footprint. Employees are encour- aged to travel by train when possible and give preference to videoconferencing rather than physical meetings involving travel. The table below shows the CO2 emissions from employees’ business travel by train, plane and car journey. The indicator is given both as an absolute value and as the ratio between CO2 emissions from business travel and the average number of employees in 2023. Data and meth- odology are verified by CO2Logic/Southpole and provided by referenced travel agencies for each country. In 2023, the Group carbon emissions related to business travels continued to decrease, pre- dominantly due to more conscious travel movements overall. In addition, since 2019, all new company vehicles must either be hybrid or electric. At the end of 2023, 47% of the Group’s vehi- cle fleet was replaced by plug-in hybrid or fully-electric. We anticipate the percentage to grow significantly in 2024 as more cars come to their lease-end period.

Travel emissions (in tCO2e)

	2021	2022	2023
Emissions from business travel	542	861	682
Emissions from business travel per employee	1.8	2.3	1.8

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COMMITMENTS

Green offices and working

The Group has committed to 100% of VGP’s countries implementing Work Greener program captured in the VGP Green Offices and working guidelines. The VGP Green offices and working guidelines offer employees the work environment and tools to reduce the environmental impact of their day-to-day work. The program enables employees to make VGP offices more sustain- able and environmentally friendly, implementing eco-friendly initiatives such as tackling waste management, promoting responsible consumption, or sustainable mobility. Since 2019, 100% of our countries delivered at least one Work Greener initiative. Initiatives from the program should help the Group with improved waste management, eco-friendly mobil- ity, better water- and energy efficiency, reducing paper waste and improving general awareness.

Well-being

Employee well-being is a key part of the ESG strategy and Group HR strategy. VGP works to support a healthy working environment with a structured focus on health & well-being to help employees thrive. A gym membership roll-out was initiated in 2023 in response to employee requests. The Group’s Well-being framework is based on the WorldGBC’s Health and Wellbeing Framework.

Healthy culture — Work-life balance:

home/flexi working practices are in place in all countries, in addition to continued family-friendly policies. The topic of work-life balance is typically included in per- formance reviews to encourage conversations with managers;

• In total 358 employees participated in the 2023 version of the Employee Survey, which allowed all employees to easily give feedback on topics such as well-being support and improving ways of working. The survey will be conducted each year to help shape effective plans to create an even better working culture;
• On the 9th of September 2023, VGP organized a Family Day for its employees, their partners and children. On the warmest day of the year, 415 people from all 16 VGP countries gathered together at the Rennbahn site in Düsseldorf, Germany. Lots of different entertainment activ- ities were provided for young and old and all enjoyed a sumptuous BBQ. It was a successful day with an opportunity to get to know each other better, share stories and create new con- nections within the VGP Family.

Spanish VGP Team

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Healthy bodies

• To encourage a healthy lifestyle, use of bicycles is encouraged, gym and sport memberships are sponsored and healthy food alternatives are offered in office canteen and kitchens (fruit free of charge)
• Healthcare benefits: health insurance is offered to all employees
• Green challenge week took place for the team in Portugal encouraging colleagues to take bicycle or walk to the office for the daily commute

Occupational health and safety

The Group pursued its compliance and HSE risk prevention training strategy in 2023, including a focus on “HR toolbox” training.

• Absenteeism is monitored;
• Causes of work-related accidents are analysed and measures are taken to prevent them recurring. No loss time due to injuries was reported for VGP employees in 2023. The Total Recordable Injury Frequency and Lost Time Injury Frequency Rate for contractors in 2023 was 0.12 and 0.58 respectively.

Health and Safety – VGP Employees	2020	2021	2022	2023
Employees in VGP premises covered by VGP H&S policy	100%	100%	100%	100%
Employee loss-time injury frequency rate	0	0	0	0
Employee total recordable injury frequency	0	0	0	0
Total number of hours worked	c. 500,000	c. 600,000	c. 700,000	c. 750,000

Development projects – contractor controlled	Number of contractor fatalities	Number and rate lost time injury frequency rate	Contractor loss-time injury frequency rate	Total number of contractor hours worked
2020	0	1 contractor	n.a.	c. 4.4 million
2021	0	2 contractors	n.a.	c. 5.4 million
2022	1 contractor	2 contractors	0.40	c. 5.0 million
2023	1 contractor	2 contractors	0.58	c. 3.4 million

Absenteeism	2023
Average absentee rate	2.99%
Data coverage	81%

1 LTIFR: Lost-time injury frequency rate calibrated to one million hours; TRIF: total recordable injury frequency rates are standardised to 100,000 hours.
2 As HR-policies are defined decentralized and on a country level – absentee rates are not reported for the entire group. Coverage was 73% based on EOP FTE counts.

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COMMITMENTS

Human rights and labour conditions

VGP complies with the labour standards set by the International Labour Organization (“ILO”). The Group only operates in countries where social regulations are well developed through dem- ocratic frameworks. Internally, specific frameworks set up by the Group define and manage additional regulations that reinforce employee rights and strongly endorse respect and ethical conduct in business dealings (Code of Conduct, Anti-corruption program, etc.). Since 2019, VGP has been a member of the UN’s Global Compact, which promotes ethical conduct and fundamental moral values in business. VGP strives to adopt, support and apply in its sphere of influence the ten principles of the Global Compact concerning human rights, labour, environment and anti-corruption. VGP’s commitment to adhere to the principles is laid down in the Group’s Code of Conduct. As of December 31, 2023, 86% of employees were covered by a collective agreement.

Sustainable Supply Chain Management

The ESG strategy of the Group encompasses a much wider footprint than the Group itself. Being a substantial buyer, VGP is aware of the importance of driving industry standards and our ability to support by pushing for an evolution on the way we can drive suppliers and service providers toward more sus- tainable operations.

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SUSTAINABLE SUPPLY CHAIN MANAGEMENT# COMMITMENTS

2.3.3 Purchasing mapping

Purchases at VGP can be split into three categories:

• Corporate overheads, including office management, business travel, consultancy and audit fees, corporate communication and public relations costs, ICT and other administrative costs. This covers all Group staff and country offices;
• Facility Management costs, services provided to properties for operations, such as maintenance, greening, energy and fluid provision, and marketing expenses (OPEX paid by the property owner and mostly passed onto tenants as service charges); and
• Capitalised construction works invested in properties for three main purposes: new development or enhancement works, maintenance works or reletting works (CAPEX paid by the property owner); these include mainly purchases from contractors, fees for architects, designers and engineering firms, and insurance premiums.

The varied nature of procurement and the diverse locations of the Group’s properties result in having most of the supply chain being local companies or subsidiaries that support the local economy. In addition, wherever possible, the purchasing policy favours local purchases in the catchment area of the Group’s assets in order to contribute to employment and local economic development. Purchases consist principally of OPEX and CAPEX for the operation and development of properties (overheads being a small part of the overall expenses). Facility management expenses are predominantly spent locally. OPEX and CAPEX costs mostly comprise labour-intensive services and to that extent are purchases that cannot be relocated. Capitalised construction works are non-recurring expenses depending on development activity.

VGP Park Montijo, Portugal

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VGP NV ANNUAL REPORT 2023

2.3.4 Value chain due diligence/CSDDD

Whilst the Corporate Sustainability Due Diligence Directive (CSDDD/CSDD) in its current form is not expected to be applicable to VGP due to the turnover and employee thresholds of companies in scope, the Group agrees to the principals of what the Directive is aiming to achieve. As part of its aim to help the EU transition toward a more climate-neutral and green economy, the CSDDD would oblige companies to ensure their business models and strategies are compatible with the Paris Agreement. Additionally, companies that identify climate change as “a principal risk for, or a principal impact of,” their operations would have to include emissions reduction objectives in their business plans.

For human rights due diligence, the CSDDD is expected to align with existing international standards to which the Group already complies. These include the UN’s Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, and the OECD Due Diligence Guidance for Responsible Business Conduct. The impact on Directors’ duty of care and remuneration will be further assessed.

VGP is committed to protecting human rights, health, safety and the environment in its value chain. To strengthen its approach to responsible procurement, VGP established a mapping of ESG-related risks in its supply chain in 2022 as reported in the Corporate Responsibility Report 2022. This mapping allows VGP to understand and identify key risks related to sustainability in its upstream value chain and will allow the Group to define and implement action plans to manage these risks.

2.3.5 Sustainable procurement

VGP’s procurement strategy is designed to comply with the following rules: fairness, focus on quality, long-term partnerships, reduced risk and the respect for applicable regulations. Moreover, the Group must honour the trust placed in it through property management contracts which aim to be transparent and cost-efficient. In addition to the principles and rules detailed in the Group procedures (and specifically in the Code of Conduct and the Anti Bribery and Anti-Corruption policy), all purchases must comply with the applicable local laws and regulations, especially labour and environmental laws. To secure the proper application of these rules, in the case of a tender process and over the term of a contract, the supplier can contact the VGP Compliance Officer at any time to raise and submit a complaint, in accordance with the Group’s whistleblowing procedure. The VGP internal audit team can carry out regular audits across the Group to validate the thorough application of the Group’s procurement policy.

The ESG approach is fully integrated at each step of the supplier procurement and referencing process of VGP. In the CDP Supplier Engagement Rating Report 2022, VGP received an A- score for its supplier engagement, which is the leadership band higher than the Europe regional average (B-) and higher than the real estate sector average (B-).

VGP Park Rodgau, Germany

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SUSTAINABLE SUPPLY CHAIN MANAGEMENT

2.3.5.1 Selection of suppliers

VGP chooses its contractors with great care and ensures they comply with its procurement policy. The Group-wide purchasing procedure guarantees an optimised price for the best level of service while securing an equal treatment among providers/suppliers. It states that the suppliers of all goods and services must be selected fairly on the basis of objective, comparable criteria and, when relevant, according to procedures relating to invitations to tender. Prospective business partners are screened in line with the onboarding procedure of the Group. These due diligences aim to assess the partner exposure to corruption risk, and identifying past international labour law or human rights breaches. Before a new service provider joins the approved list, a substantial amount of information is required, including an overview of its ESG strategy and practices. These environmental and social factors are of particular importance to the Group’s information in its choice of suppliers and form part of the criteria considered in tender processes. Each purchasing step is duly documented for traceability.

Built around NetSuite, a web-based solution for purchasing management was launched in 2022. It makes the procedures of VGP more robust, ensures the transparency required for all purchasing decisions, helps operational teams to select providers, and facilitates the sharing of best practices and risks mitigation. This solution secures the administrative management for the whole purchasing cycle.

2.3.5.2 Inclusion of ESG criteria in contractual clauses

General purchasing conditions apply for all the countries in which VGP operates, although they vary, according to local requirements. A clause is also automatically included in these conditions, requiring suppliers to abide by the Group’s Code of Conduct provisions, including complying with applicable laws and regulation, prevention of all forms of corruption and discrimination, respect for human dignity and for employees’ work including a commitment to comply with the conventions of the International Labour Organisation (“ILO”) and with local employment legislation, preservation of the environment and reporting practices that are in breach of these principles using the contact procedure provided by the Group.

Suppliers are required to comply with all relevant safety (we generally expect our general contractors and health-and-safety coordination partners to comply with ISO 45001), labour and environment (including but not restricted to waste and water management) legislation. We expect our general contractors and engineering partners to have a site environmental management accreditation (ISO 14001), including operating with best practices. Suppliers are required not to engage in any direct or indirect form of human trafficking, slavery, forced or involuntary labour.

Compliance with ISO HSE and environmental management accreditation	% of general contractors complying with ISO 45001 – Safety Management System (projects under construction and delivered in 2023)	% of general contractors complying with ISO 14001 – Environmental Management System (projects under construction and delivered in 2023)	% of HSE coordinators separately certified by ISO 45001
	86%	86%	33%

For projects under construction, the contracts signed with suppliers state that the Group and the companies it controls are committed to reducing the carbon footprint of their projects, particularly during the development phase of the assets. A clause indicates that the construction companies involved in the Group’s projects must take the carbon impact into account when selecting construction techniques, materials and technical solutions. After each project review and at all project stages, an arbitration regarding the carbon footprint impact is to be taken for the proposed solution to be submitted to the Group. The principles and action plans used to select the most sustainable materials with a reduced carbon content are specified in Section 2.3.3 Construction materials.# VGP NV ANNUAL REPORT 2023

COMMITMENTS

. VGP in the community

This is the Hungarian team during their Community day

CORPORATE RESPONSIBILITY REPORT 2023

Input from and consultation with local stakeholders shapes the design, purpose and tenant occupational mix of VGP Parks. The Group is committed to meeting the distinct interests of each municipality and creating mutually beneficial outcomes including local connectivity, a compelling business mix and direct employment for local residents, and long-term project success. The Group’s economic success is based on a strong relation- ship with its stakeholders: tenants, customers, investors, local communities, suppliers and contractors, as well as employees. These strong relationships are critical to develop and operate Parks meeting stakeholders’ expectations in all respects. VGP is aware of the economic importance of its real estate prop- erties: in addition to being a contributor to urban planning for logistics and semi-industrial zones within cities, providing pub- lic facilities and developing technically advanced and sustain- able buildings and well connected places, VGP plays a key role in the local ecosystem as an economic driver: offering direct employment through construction and operational spending, indirect employment by tenants’ operations and network activ- ities, suppliers’ activities and local taxes. For development projects, a community engagement pro- gram is typically set up at the start of the design phase in order to collect feedback from council, neighbours or other local stakeholders. When construction activities begin the aim is for neighbours to be informed about the anticipated project and provide contact details in case of questions. In 2023, 98% of development projects had a community engagement program. An example of a project is the annual book collection during the week of Sant Jordi in our Spanish parks. The Day of Books and Roses, April 23, is celebrated in Catalonia, Spain. On this day, love and literature are celebrated throughout Catalonia. Books and roses are exchanged. Our local facility & property management team organizes a collection of books across the tenants in our Spanish parks and delivers the books to associ- ations working with children. In total 345 books were collected and donated. In the week before Christmas, they collected toys which were donated to several social organisations.

.. Expand local economies

Be it at a regional or country level, having a clear understand- ing of the economic and social impacts of its activities is key for the Group. VGP assesses the social and economic impact of each development project, which includes both the tempo- rary impacts of the construction phase, as well as the long- term contribution of the asset’s operations to the prosperity of local communities. Throughout the development, the Group not only generates construction-related jobs, but often also contributes to the development of transportation infrastruc- ture, dynamizing the communities in which it operates. Once completed, projects serve as catalysers of local employment (directly and indirectly), economic activity and tax income. The Group’s developments play a key role in revitalising and regenerating areas, attracting additional investment and pro- jects, and unlocking their growth potential. The assessment and enhancement of the socio- economic impact of develop- ment projects supports a constructive dialogue and collabora- tion with the local authorities. Once parks are in operation, the consideration of the socio-economic impact is fully integrated as part of the decision-making procedures; local companies are typically favoured for new space requirements; social and economic criteria are systematically considered and addressed when entering in relationships with stakeholders, particularly with the supply chain during the purchasing process. In 2023 a total of 345 books were collected across VGP Parks in Spain which were donated to children during La Diada de Sant Jordi, April 23

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VGP NV ANNUAL REPORT 2023

COMMITMENTS

.. VGP Community Day

The VGP Community Day is designed to engage a large num- ber of employees in volunteering for a local charity, involving each of the 16 countries where the Group operates. During 2023, our local teams were very productive in organizing a VGP Community Day in their respective coun- tries. A total of 75% of Group employees delivered more than 1,000 volunteering hours in 2023. Some example initiatives:
* Our Hungarian VGP team had a very productive and enriching Community Day at a foster home for vulnerable children, near the Budapest office. They repainted exist- ing benches and toys, created new Canadian benches and development toys on asphalt, cleaned the garden, and much more to brighten the environment and to give the children the best possible place to stay.
* The entire team of VGP Austria spent a productive Com- munity Day at the forest area of the Heiligenkreuz Abbey, near Vienna. On an area of about 5,000 m², 800 silver fir trees were planted by the team. This way, they contributed to the reforestation of the forest areas, with a lot of fun and commitment, and they were able to learn more about eco- logical forestry and forest management.

.. VGP for Jobs

Logistics real estate can have a significant positive impact on the surrounding community. VGP’s business strategy is to build, own and operate logis- tics facilities close to urban centres. This shortens delivery routes, reduces delivery times and reduces related emissions. VGP’s clients and our clients’ customers (both business and residential) benefit from next-day or even same-day delivery of the goods and services they need. Additional benefits include plentiful logistics jobs, shorter commute times for logistics workers, reclamation and remediation of abandoned or brown- field sites and even enhancement of local parks and transpor- tation. Based on our understanding of employment generated in our parks as of December 2023 circa 20,000 people go to work under VGP roofs each day (versus c.17,000 in Decem- ber 2021 and c.15,000 in December 2019). Based on Oxford Economics peer reports the likely direct and indirect impact is closer to 100,000 jobs. VGP also aims to help the local community benefit from such job creation, including through internship programs. One example is our participation to the #JovesFutur+ project of the Barça Foundation and Fundació “La Caixa”, a project for the inclusion of young people with less opportunities in the labour market. We gave the opportunity to its participants to visit our Spanish office and our VGP Park Llica d’Amunt. They could also meet our tenants, such as Coats, Districenter, Noa- tum Logistics, Bomi Group, Miscota and Moldstock,S.L. to learn more about the logistics sector, with the aim of prepar- ing them for the labour market.

VGP Austria team during local Community Day 2023 planting trees in a forest near Vienna.

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VGP IN THE COMMUNITY

... Cities of Making – smaller business units diversify city manufacturing potential

In line with EU Taxonomy minimum safeguards and OECD guidelines for Enterprises, VGP aims to encourage local capacity building through close cooperation with the local community, including business interests, as well as activities consistent with the need for sound commercial practice. A recent JPI Urban Europe study called “Cities of Making” iden- tified, among 10 other “needs”, the “need” for city business parks to offer “a suitable mix of unit sizes for a diverse range of business types in according to the phase of their develop- ment” 1 . Whereas urban logistics service sectors are typically dominated by multinational players, a high proportion of man- ufacturers are SME (Small and Medium-Sized Enterprises), businesses employing fewer than 250 people, or micro-busi- nesses, employing fewer than 10.

... Raising awareness among existing suppliers

To encourage existing suppliers and contractors to improve sustainable operating practices and use environmentally sus- tainable materials, the Group is sharing its ESG policy and related environmental and social targets with all its main ser- vice providers Group-wide through official communication letters. These included contents and ambitions of the Group ESG strategy and the announcement of further supplier engagement on ESG topics. With significant material suppli- ers in 2022-2023 a dialogue has been initiated to better under- stand the carbon footprint of materials usage and ways to further improve such footprint. The Group confirmed its will- ingness to work together with its supply chain also in its SBTi submission.

Supplier active dialogue

	2023
% of significant suppliers having to comply with supplier code of conduct	100%
Significant suppliers engaged in ESG dialogue including carbon footprint improvement alternatives	68 (29%)

The Group has also introduced initiatives concerning incen- tives for energy savings and waste segregation performance. These site-by-site practices challenge contractors and suppli- ers and serve as a basis to involve them in a process of contin- uous improvement for all assets.

... Improving the ESG performance of suppliers

Increasingly supplier assessment of compliance with environ- mental clauses, management modes and service quality are performed on key services. The supplier assessment process allows for the evaluation of supplier compliance with contractual requirements and to anticipate tender needs. Data collected through these assess- ments, once consolidated, are also shared with contractors through project steering meetings. In addition, our procurement team supported by our head of product innovation reaches out to high-impact suppliers to discuss potential improvements to their ESG product footprint.

PAGE 27

VGP NV ANNUAL REPORT 2023

COMMITMENTS# CORPORATE RESPONSIBILITY REPORT 2023

VGP FOUNDATION

The VGP Foundation strives to encourage nature conservation, have an impact on local communities through social projects, and conserve and protect European cultural heritage. During 2023, 3 additional projects were approved bringing the total to 27 projects of which 13 are currently in execution and 14 completed, with € 5.1 million in total committed or spent. The VGP Foundation has three focus areas:

— Nature conservation: engaging in projects encouraging nature conservation, such as saving and creating permanent biotopes, protecting animals and their natural habitats, or educational programmes raising public awareness about respective issues.
— Social projects: persuaded that access to education and fundamental care are crucial ingredients for their positive development, the VGP Foundation supports social projects around children from disadvantaged environments.
— Cultural heritage: the VGP Foundation supports projects which define local regional cultural heritage through various cultural domains such as architecture, music, fine art and other forums of cultural heritage.

An example of a project currently under execution and expected to be completed in March 2024 is Villages Go Green, a project encouraging nature protection at a grassroots level. The following page describes the project in more detail. Some examples of other projects currently under execution include:

Finding new networks for the Eastern Imperial Eagle, Katra valley biodiversity project in South Lithuania, Restoration of Transcarpathian Peatlands “Chorne Bagno”, Ukraine, Ukrainian Center in Brno, Czech Republic and a project conducted by Rewilding Europe in the Velebit mountains in Croatia.

VGP Foundation projects currently in execution

• Social centre BC Capelderij
  BC Capelderij – a safe and inviting place for young people who need to refuel on their life’s journey.
• TAJO: Talent workshops for disadvantaged youngsters
  TAJO is a non-profit initiative started in Ghent (Belgium) promoting a successful educational pathway for disadvantaged youngsters between the age of 18 and 25 years.
• New Networks for the Eastern Imperial Eagle
  Improving the conservation measures for the Eastern Imperial Eagle by transferring knowledge between existing conservation projects and closing knowledge gaps.
• Black Rhino Reintroduction
  The population of black rhinoceros faced a dramatic decline of 97.5% in the second half of the 20th century. Classified as “critically endangered”, black rhinos are now being re- introduced into the wild in order to avoid their extinction.
• New International NABU Crane Centre
  NABU e.V. is aiming to establish a unique International Crane Centre in Germany to provide information on climate protection and biodiversity. The New International Crane Centre will be a travel destination for all crane lovers in Europe.
• Stage fright
  A project to make a positive future story possible for underprivileged children who have difficulty finding their way to regular leisure activities or who have problems at school.
• Green educational bastion
  The project combines all three focus areas of the Foundation: nature conservation, cultural heritage and education. Bastion IX is an impressive piece of heritage with a piece of unique nature to be integrated into the curriculum of Oscar Romero- college in Dendermonde.
• Tibur Hof
  Renovating, bringing to modern ESG standards and occupational use of this late-classicist listed mansion and grounds in Rumst, Belgium. Will house offices for VGP Foundation, offering charitable amenities and head office of VGP NV.
• Peatland Restoration
  We are currently identifying a peatland plot suitable for restoration.
• Monitoring of peatland water levels in Germany
  Monitoring of peatland water levels as a basis for controlled rewetting of partially drained peatlands in the Rotenburg (Wümme) and Stade counties.
• The Katra river valley Biodiversity
  The Lithuanian biodiversity spot for many rare birds, plants, and animals.
• Protection of bats in Transcarpathia region
  Protecting bats in church towers and public building attics as an affirmation of biodiversity values among religious and local communities.
• Reorganization of Retezat Biosphere Reserve
  Reorganization and adjustment of Retezat Biosphere Reserve, in order to fulfil the MAB criteria on Biosphere Reserves.
• Ukrainian Center in Brno
  The Ukrainian Center in Brno offers social, psychological, and educational services for people from Ukraine seeking refuge from war, mostly women with children.
• Aristeu Bee project
  Protection of bees by placing beehives around VGP parks and donating the produced honey to children’s social canteens.
• CESAMM: Centre for Social Action and Music Making
  The centre is created as part of the Chair Jonet at the University and University College of Ghent to develop research as well as to accompany musicians and social workers who propose music practice as a possible way to navigate towards more attractive positions in society.
• Villages Go Green
  VGP Foundation encouraging nature protection at a grassroots level in local villages and schools in Cyprus. In 2023 work continued on a project to expand public awareness of the importance of nature conservation in Cyprus. In March 2023, ÇADER, a non-profit civil society organization in Northern Cyprus, successfully completed an Environmental Protection Project for Northern Cyprus, funded by the VGP Foundation and administrated by NABU International. From the gained experience emerged a new project Villages Go Green aiming to further encourage nature protection at a grassroots level and to expand the awareness-raising activities to more schools and other villages.
• Dionysos Now!
  The research, development, producing, performing and recording of the music of Adriaen Willaert – Flemish Polyphony.
• James by Junior Ballet Antwerp
  Junior Ballet Antwerp invests in young talent & forms a bridge between the end of studies and the start of a professional ballet career.

For more information, please visit: www.vgp-foundation.eu/en/projects/

VGP NV ANNUAL REPORT 2023

COMMITMENTS

VGP FOUNDATION

The VGP Foundation strives to encourage nature conservation, have an impact on local communities through social projects, and conserve and protect European cultural heritage. During 2023, 3 additional projects were approved bringing the total to 27 projects of which 13 are currently in execution and 14 completed, with € 5.1 million in total committed or spent. The VGP Foundation has three focus areas:

— Nature conservation: engaging in projects encouraging nature conservation, such as saving and creating permanent biotopes, protecting animals and their natural habitats, or educational programmes raising public awareness about respective issues.
— Social projects: persuaded that access to education and fundamental care are crucial ingredients for their positive development, the VGP Foundation supports social projects around children from disadvantaged environments.
— Cultural heritage: the VGP Foundation supports projects which define local regional cultural heritage through various cultural domains such as architecture, music, fine art and other forums of cultural heritage.

An example of a project currently under execution and expected to be completed in March 2024 is Villages Go Green, a project encouraging nature protection at a grassroots level. The following page describes the project in more detail. Some examples of other projects currently under execution include:

Finding new networks for the Eastern Imperial Eagle, Katra valley biodiversity project in South Lithuania, Restoration of Transcarpathian Peatlands “Chorne Bagno”, Ukraine, Ukrainian Center in Brno, Czech Republic and a project conducted by Rewilding Europe in the Velebit mountains in Croatia.

VGP Foundation projects currently in execution

• Social centre BC Capelderij
  BC Capelderij – a safe and inviting place for young people who need to refuel on their life’s journey.
• TAJO: Talent workshops for disadvantaged youngsters
  TAJO is a non-profit initiative started in Ghent (Belgium) promoting a successful educational pathway for disadvantaged youngsters between the age of 18 and 25 years.
• New Networks for the Eastern Imperial Eagle
  Improving the conservation measures for the Eastern Imperial Eagle by transferring knowledge between existing conservation projects and closing knowledge gaps.
• Black Rhino Reintroduction
  The population of black rhinoceros faced a dramatic decline of 97.5% in the second half of the 20th century. Classified as “critically endangered”, black rhinos are now being re- introduced into the wild in order to avoid their extinction.
• New International NABU Crane Centre
  NABU e.V. is aiming to establish a unique International Crane Centre in Germany to provide information on climate protection and biodiversity. The New International Crane Centre will be a travel destination for all crane lovers in Europe.
• Stage fright
  A project to make a positive future story possible for underprivileged children who have difficulty finding their way to regular leisure activities or who have problems at school.
• Green educational bastion
  The project combines all three focus areas of the Foundation: nature conservation, cultural heritage and education. Bastion IX is an impressive piece of heritage with a piece of unique nature to be integrated into the curriculum of Oscar Romero- college in Dendermonde.
• Tibur Hof
  Renovating, bringing to modern ESG standards and occupational use of this late-classicist listed mansion and grounds in Rumst, Belgium. Will house offices for VGP Foundation, offering charitable amenities and head office of VGP NV.
• Peatland Restoration
  We are currently identifying a peatland plot suitable for restoration.
• Monitoring of peatland water levels in Germany
  Monitoring of peatland water levels as a basis for controlled rewetting of partially drained peatlands in the Rotenburg (Wümme) and Stade counties.
• The Katra river valley Biodiversity
  The Lithuanian biodiversity spot for many rare birds, plants, and animals.
• Protection of bats in Transcarpathia region
  Protecting bats in church towers and public building attics as an affirmation of biodiversity values among religious and local communities.
• Reorganization of Retezat Biosphere Reserve
  Reorganization and adjustment of Retezat Biosphere Reserve, in order to fulfil the MAB criteria on Biosphere Reserves.
• Ukrainian Center in Brno
  The Ukrainian Center in Brno offers social, psychological, and educational services for people from Ukraine seeking refuge from war, mostly women with children.
• Aristeu Bee project
  Protection of bees by placing beehives around VGP parks and donating the produced honey to children’s social canteens.
• CESAMM: Centre for Social Action and Music Making
  The centre is created as part of the Chair Jonet at the University and University College of Ghent to develop research as well as to accompany musicians and social workers who propose music practice as a possible way to navigate towards more attractive positions in society.
• Villages Go Green
  VGP Foundation encouraging nature protection at a grassroots level in local villages and schools in Cyprus. In 2023 work continued on a project to expand public awareness of the importance of nature conservation in Cyprus. In March 2023, ÇADER, a non-profit civil society organization in Northern Cyprus, funded by the VGP Foundation and administrated by NABU International. From the gained experience emerged a new project Villages Go Green aiming to further encourage nature protection at a grassroots level and to expand the awareness-raising activities to more schools and other villages.
• Dionysos Now!
  The research, development, producing, performing and recording of the music of Adriaen Willaert – Flemish Polyphony.
• James by Junior Ballet Antwerp
  Junior Ballet Antwerp invests in young talent & forms a bridge between the end of studies and the start of a professional ballet career.

GREEN FINANCING OF THE GROUP ACTIVITIES

EU Taxonomy

VGP team receiving EU Taxonomy verification at Expo Real 2023

EU TAXONOMY

Context

The Taxonomy Regulation introduces a unified classification system to determine the sustainability level of investments, in order to drive capital towards financing the EU environmental transition. The sustainability of a financial vehicle is determined by the share of sustainable economic activities it finances in its portfolio. Consequently, all economic activities listed in the scope of the Taxonomy Regulation (i.e. “eligible” activities) are to be screened for their environmental impacts, based on the environmental criteria (“Technical Screening Criteria”) defined in the Taxonomy Delegated Acts. To be considered environmentally sustainable, an economic activity has to substantially contribute to at least one out of the six following “environmental objectives”, while not causing harm to the others and complying with “minimal safeguards” related social and ethical standards:

— Climate change mitigation;
— Climate change adaptation;
— The sustainable use and protection of water and marine resources;
— The transition to a circular economy;
— Pollution prevention and control; and
— The protection and restoration of biodiversity and ecosystems.

On 15 June 2023, the European Commission (EC) published The final Environmental Delegated Act, with that the technical screening criteria of all six environmental objectives of the Taxonomy Regulation (“Environmental Delegated Act”) are defined. The Taxonomy Regulation represents an important step towards the EU’s objective of becoming climate neutral by 2050. The real estate sector is considered eligible to the Taxonomy of these environmental objectives. This means that the real estate sector, which plays a vital part in the economy, also has a key role to play in the transition towards a low carbon and climate resilient future.

VGP share of eligible activities

As a real estate player, VGP is committed to meeting the requirements set by this new Taxonomy Regulation and improving its performance in the coming years to contribute to the broader EU environmental transition.# VGP NV ANNUAL REPORT 2023

GREEN FINANCING OF THE GROUP ACTIVITIES

5.2.1 VGP Share of eligible activities

As the first step of the Taxonomy application, companies are to determine which of their activities are “eligible”, i.e. covered by the Taxonomy Delegated Acts. Three KPIs are to be disclosed to that end:

• the share of eligible activities in the company’s Revenues,
• Capital expenditures (“CAPEX”) and
• Operational expenditures (“OPEX”)

in alignment with the Group’s reported Consolidated Income Statement and Balance sheet and, as an additional reference, VGP also publishes the same metrics based on the proportional consolidated balance sheet.

Eligible activities based on Group’s reported IFRS Consolidated Income Statement and Balance sheet

Revenues (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
Gross rental income		64,642	—	64,642
Service charge income		17,794	—	17,794
Property and facility management income		22,513	—	22,513
Property development income		4,412	—	4,412
Renewable Energy income		4,361	—	4,361
Total reported revenue		113,722	—	113,722

Capital Expenditure (“CAPEX”) (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
CAPEX on investment properties		692,859	—	692,859
Investments in PPE (tangible assets)		32,955	1,191	34,146
CAPEX on intangible assets		—	—	—
Total CAPEX assessed for EU Taxonomy alignment		725,814	1,191	727,005

Operating Expenditure (“OPEX”) (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
Net property operating expenses minus service charge income		23,328	—	23,328
Total OPEX assessed for EU Taxonomy alignment		23,328	—	23,328

Eligible activities based on Group’s proportionally Consolidated Income Statement and Balance sheet

Revenues (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
Gross rental income		166,715	—	166,715
Service charge income		41,194	—	41,194
Property and facility management income		22,513	—	22,513
Property development income		4,412	—	4,412
Renewable Energy income		4,361	—	4,361
Total reported revenue		239,195	—	239,195

Capital Expenditure (“CAPEX”) (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
CAPEX on investment properties		692,859	—	692,859
Investments in PPE (tangible assets)		32,955	1,191	34,146
CAPEX on intangible assets		—	—	—
Total CAPEX assessed for EU Taxonomy alignment		725,814	1,191	727,005

Operating Expenditure (“OPEX”) (€ ’000)	31.12.2023	Eligible activities	Non-eligible activities	Total
Net property operating expenses minus service charge income		57,224	—	57,224
Total OPEX assessed for EU Taxonomy alignment		57,224	—	57,224

The change in the share of eligible activities between 2022 (figures published in VGP’s 2022 Corporate Responsibility Report) and 2023 is explained by the following factors:

• For eligible revenues: year over year increase driven by increase in total gross revenue growth of the Group (€155.6 million vs €97.6 million over FY2022); and
• For eligible CAPEX: decrease driven by lower capital expenditure (€695 million vs €757 million over FY 2022) and €1.19 million non-eligible expenditure (vs €0.7 million over FY 2022).
• For eligible Operating Expenditure: to the reported net operating expenses service change income has been added back

5.2.2 Methodology of KPI calculation

The Commission Delegated Regulation (EU) 2021/2139 of 4 July 2021 supplementing the Taxonomy Regulation specifies the content, methodology and presentation of information to be disclosed by financial and non-financial undertakings concerning the proportion of environmentally sustainable economic activities in their business, investments or lending activities. The preliminary work done by VGP to establish its eligibility KPIs was based on this regulation, the methodology is presented in this section.

Allocation rules to the denominators

• As defined in the aforementioned Delegated Regulation, total revenues and total CAPEX have been determined in accordance with IFRS accounting standards applied to VGP activities and in line with financial statements:
  • Total revenues = gross rental income + service charge income + property and facility management income + property development income + renewable energy income;
  • Total CAPEX = CAPEX on investment properties + CAPEX on tangible assets + CAPEX on intangible assets; and
  • Only fully consolidated companies are included in the scope, and KPIs are reported on IFRS bases (not under proportionate consolidation)
• The Delegated Regulation requires reported OPEX in the denominator to be limited to costs related to building renovation, maintenance and repair, short-term lease, and research and development. VGP’s OPEX are based on the Net property operating expenses.

Allocation rules to the numerators: determining eligible activities

• To determine the eligible share of Revenues (numerator), a screening of VGP revenue categories was performed according to the Delegated Acts’ qualitative definitions of activities covered: among the revenue categories listed above all are considered eligible to the Taxonomy.
• To determine the eligible share of CAPEX (numerator), a screening of VGP’s investment categories was performed according to the Delegated Acts’ qualitative definitions of activities covered: among the investment categories listed above, CAPEX on investment properties and CAPEX on renewable energy technical installations are considered eligible. Other equipment, furniture and intangible assets are excluded from the eligibility scope.
• The eligible share of OPEX (numerator) is considered to cover the same scope of OPEX categories as for the OPEX denominator, these being specifically listed in the Delegated Regulation scoping the expenses to consider.
• The last step for calculating the Revenues, CAPEX and OPEX numerators was to identify, among all VGP activities, asset types or legal entities that would not be considered in the Delegated Acts’ scopes. A preliminary screening of all VGP entities based on NACE codes, an analysis of specific business lines has been performed. As a conclusion of this analysis, a conservative approach was taken, deciding to include all of VGP activities in the eligibility numerators.

5.2.3 VGP share of aligned activities

The second part of the Taxonomy application consists of the screening and activities. Three KPIs are to be disclosed to that end: the share of aligned activities in the company’s Revenues, CAPEX and OPEX. Financial year 2023 corresponds to the first year of application for which VGP reports alignment figures.

5.2.3.1 2023 Results of VGP’s share of aligned activities

Taxonomy alignment figures calculated in accordance with the templates set by the European Commission: based on total activity (including non-eligible activities) and including service charge income lines, in compliance with the IFRS accounting standards, are presented in section 5.3 “VGP Share of aligned activities” – European Commission reporting templates, given their size and complexity.# Taxonomy alignment figures presented in the summary table below have been calculated on the basis of eligible activities only, presented in section 2.1. VGP share of eligible activities.

Two consolidation methodologies have been applied: assets consolidated in compliance with the IFRS accounting standards using the equity method, and assets consolidated in the proportionate methodology including also joint-controlled entities, in order to valorise the alignment of assets in VGP’s portfolio that are not accounted for in the IFRS methodology as well. In this specific table, revenue lines corresponding to charges reinvoiced to the tenants (service charges income) have been included for numerator and denominator, so the total reported revenue corresponds to the total reported revenue in the Group’s income statement (see Notes to and forming part of the financial statements). For OPEX the service charge income/expenses have been added to the reported Net property operating expenses from the Group’s income statement.

All VGP activities aligned presented here below contribute substantially to the objective of climate change mitigation.

VGP activity (Taxonomy code)	Alignment figures (among eligible activities) to the consolidated IFRS accounts	Alignment figures (among eligible activities) to the proportionally consolidated accounts
	% Revenue	% CAPEX
Standing assets (7.7)	0.9%	n/a
Construction of new buildings (7.1)	0.0%	0.1%
Major renovations (7.2)	n/a	n/a
Developments for third parties (7.1)	0.0%	0.0%
Individual measures (7.3 to 7.6)	0.1%	0.3%
Total	1.0%	0.5%

Alignment figures show that — on a consolidated basis, VGP has 1.0% of its revenues, 0.5% of its CAPEX and 0.0% of its OPEX considered as aligned with the EU Taxonomy environmental objectives; — on a proportional basis, VGP has 4.0% of its revenues, 0.5% of its CAPEX and 4.6% of its CAPEX considered as aligned with the EU Taxonomy environmental objectives. 2021 is the first year the Group is applying this test.

VGP’s CAPEX alignment share is mainly driven by its development projects, of the projects currently under construction 5 or 13% are under review for EU Taxonomy alignment (of the 15 projects under construction at Dec 2021), a further 3 projects due to be started up are also under review for alignment. The final alignment confirmation of the project will only be confirmed once the project works are completed. Generally, all development projects in VGP’s pipeline are managed towards contribution to climate change mitigation with regard to Taxonomy criteria. Whilst photovoltaic projects can generally be considered as contributing to climate change mitigation, for one photovoltaic project the contribution, DNSH and safeguard criteria were confirmed adding to the Individual measures category (0% of total capital expenditure on photovoltaic projects in 2021).

VGP’s Revenues alignment share is predominantly driven by the standing assets. 0.9% of gross rental revenues and 3.7% of proportional gross revenues (including share of joint ventures) are aligned with the climate change mitigation objective. Nevertheless, the Taxonomy alignment figures need to be analysed carefully in light of the applicable alignment criteria and do not necessarily reflect the absolute environmental performance of VGP’s portfolio. For example, in terms of energy efficiency performance, which is the main criteria for analysing the substantial contribution of standing assets to climate change mitigation according to the Taxonomy regulation, it is important to note that many assets that are reported as not aligned are effectively performing better than some assets which are reported as aligned. This is due to the fact that the assessment of alignment is to be based on relative comparisons to local regulations and benchmarks, which are more stringent in some countries than in others, rather than on absolute terms of performance values. More information on the translation of the Taxonomy screening criteria to VGP’s portfolio and its limitations is given in the next section.

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EU TAXONOMY 5.2.3.1 Environmental technical screening criteria

The Annexes I and II to the Commission Delegated Regulation (EU) 2021/528 of 29 June, 2021 supplementing the Taxonomy Regulation lay down the environmental Technical Screening Criteria (“TSC”) to be complied with for each eligible activity to be considered aligned with:
— Climate Change Mitigation (Objective 1), and
— Climate Change Adaptation (Objective 2).

The final Environmental Delegated Act, (EU) 2021/1217 and (EU) 2021/1216 define the TSC of the four other environmental objectives of the Taxonomy Regulation, namely:
— Sustainable use and protection of water and marine resources (objective 3);
— Transition to a circular economy (Objective 4);
— Pollution prevention and control (Objective 5), and
— Protection and restoration of biodiversity and ecosystems (Objective 6).

These criteria are twofold: criteria for checking the substantial contribution of activities to each environmental objective, and criteria for making sure these activities do no significant harm to all the other environmental objectives.

Since the Delegated Acts have been published, VGP teams have worked on translating the regulatory criteria into applicable elements for its own operations across the countries of operation (through the initiation of pilot projects in all countries of operation). Taxonomy-eligible activities cover a very broad scope of VGP activities, but this does not presume the relevance or practicability of the TSC to be applied to all these activities. For example, many of them cannot be screened based on the current published TSC without having recourse to additional information sources (local regulation, industry benchmarks from sectorial private organisations, …) or using proxies. Many examples of this situation can be given particularly due to the lack of availability of some standard elements mentioned by the TSC, such as locally endorsed benchmarks to determine the top 15% of the building stock for commercial properties, and sectorial benchmarks.

Below is a summary of the TSC criteria for substantial contribution applied by VGP for each category of its eligible activities, across all its portfolio based on the EPRA Guide for EU Taxonomy 1 :

1 EU Taxonomy Alignment in Listed Real Estate (epra.com)

Key activities of the TSC for Construction and Real Estate

	Construction and renovation	Installation, maintenance and repair activities	Acquisition and ownership
	7.1 Construction of new buildings (see Note 1)	7.2 Renovation of existing buildings (see Note 2)	7.3 Individual renovation measures consisting of Installation, maintenance and repair of energy efficiency equipment
	Development of building projects for residential and non-residential buildings by bringing together financial, technical and physical means to achieve the building projects for later sale and the construction of complete buildings, on own account for sale, on a fee or contract basis	Construction and civil engineering works or preparation thereof	Stand-alone
	Note 1	Note 2	Note 3 “5.2. Professional services related to energy performance of buildings” is also considered relevant for Real Estate from a market perspective, though it is not directly included under the related section.

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GREEN FINANCING OF THE GROUP ACTIVITIES 5.2.3.2 Do No Significant Harm criteria

Adaptation to Climate Change

Pursuant to the release of the Climate Delegated Act specifying DNSH (Do No Significant Harm) criteria on adaptation to climate change, VGP has updated in 2021 its climate risk assess- ment study covering all of the Group’s standing assets and development pipeline (see section 4.1.4 Climate risk manage- ment and adaptation to climate change). This study confirmed that VGP is compliant with the DNSH criteria of the Taxonomy.

The following steps have been followed during 2021 and further during additions in the 2022 climate risk assessment:

1. The Group first performed a screening of the climate-re- lated perils among the ones listed in Appendix A to the Annex I of the Climate Delegated Act to identify the ones most material to the business, based on the type of activ- ities, equipment, materials and the geographical footprint of the portfolio. As a result, the following perils were con- sidered applicable: heat stress, water stress, sea level rise, floods, earthquakes and wildfires;
2. For the climate-related perils considered as material, experts identified the most representative climate indica- tors. Climate indicator values were retrieved for each asset, based on their location. Climate models were then used to estimate the evolution of such values due to climate change, according to different scenarios aligned with the latest IPCC projections (see below). The climate indicator values were then translated into an impact/damage result ranging from 0% to 100%; and
3. As a follow-up to the risk and vulnerability assessment, site visits have been performed aimed at assessing the adequacy of adaptation measures already in place and at identifying new measures to be implemented.#  assets have been identified as the ones potentially most at risk from a climate change and business perspective– con- sidering both their multi-peril score and business perfor- mances. For each of those assets, adaptation plans will be designed. Asset specific actions will be considered as required. The climate scenarios selected by the experts to perform the climate change related risk analysis up to mid-century () are the SSP-. (“Middle of the Road”) and SSP-. (“pessimistic”) scenarios:
   — SSP-. is in line with today’s climate policies and  Nationally Determined Contributions targets; and
   — SSP-. is the most pessimistic scenario which was selected to avoid any unanticipated event impacting the Group’s assets.
    timeframes have been considered for the analysis, consist- ently with the expected lifetime of the activity and the indica- tions of the EU Taxonomy:
   — Baseline: average between  and  values;
   — : average between  and  values; and
   — : average between  and  values

Other DNSH criteria

For existing buildings in ownership (.), there are no addi- tional applicable DNSH criteria other than the one on climate change adaptation (see previous section). For construction of new buildings and renovation projects (. and .), the analy- sis of the compliance with other DNSH criteria than climate change adaptation has been done at project-level with  sep- arated workstreams depending on the status of the project:

VGP Park Olomouc, Czech Republic
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EU TAXONOMY

— For ongoing projects: projects were screened and ana- lysed in their current development stage and, when pos- sible, the technical criteria and/or studies related to the DNSH on water, circular economy and pollution prevention were added to the design specifications of the project to ensure its future compliance. When the projects were too advanced to change their design features, they have been considered as “not aligned” with the EU Taxonomy DNSH criteria if these criteria were not secured; and
— For new projects: an update of the Group design guide- lines adding the DNSH criteria on water, circular econ- omy and pollution prevention has been performed. As no CAPEX have been reported to substantially contribute to the objective of climate-change adaptation, the DNSH cri- teria for climate-change mitigation have not been screened in .

... Individual measures

The Commission Delegated Regulation (EU) / of July th,  translating Article  of the Taxonomy Regulation pro- vides for the integration of purchased “Individual measures” in CAPEX and OPEX alignment figures of non-aligned assets. Individual measures correspond to activities purchased that enable the target activities to become low carbon or to lead to GHG reductions, notably activities listed in points . to . of Annex I to the Climate Delegated Act, such as the installation of solar panels on a building rooftop. As part of its ESG strategy and asset-level environmental action plans, VGP plans investments in all the aforementioned categories: energy efficiency equipment, charging stations for EVs in buildings, instruments for measuring and controlling energy performance of buildings, and renewable energy technologies (see sections . Improve eco-efficiency and .. Develop connectivity and sustainable mobility). Related CAPEX spent in  have been isolated and screened in accordance with the TSC of Annex I to the Climate Delegated Act for substantial contribution and DNSH where applicable.
— Substantial contribution: the compliance of the activities disclosed in category . with the minimum requirements set for individual components.
— DNSH: for individual measures installed in assets identi- fied as most vulnerable to physical climate risks (cf. pre- vious “Do No Significant Harm” section), the materiality of the risk for that measure has been assessed (based on equipment location, etc.) as well as the coverage by the mitigation action plan where necessary.

In , VGP’s individual measures stand for .% of the Group eligible CAPEX, as presented in the alignment table at the top of this section.

... Minimum safeguards

In addition to engaging in activities that are eligible and aligned with the European Taxonomy based on the environ- mental TSC, VGP strictly complies with the  aspects of the Minimum Safeguards (MS), as described in the Article  (c) and Article  of the Taxonomy Regulation and further speci- fied in the Final Report on Minimum Safeguards published in October  by the EU Platform on Sustainable Finance as well as OECD Guidelines for Multinational Enterprises and the UN Guiding Principles of Business and Human Rights.

Human Rights

Regarding human rights guarantees and due diligence in its own workforce, ethics and respect for human rights are among the core values of the Group. VGP is strictly commit- ted to upholding all fundamental individual rights and labour rights protections (see section .. Human Rights and Labour Conditions), as well as safeguarding the H&S and the wellbe- ing of its employees through enforced internal frameworks such as a dedicated Group framework for health and safety risk management and the Group’s Your Wellbeing framework (see sections ... Well-being, .. Occupational health and safety and . Sustainable Properties for the sections: Health and safety, security and environmental risk, and pol- lution). VGP only operates in countries with high standards of human rights protections and the infringement of human rights in its own workforce has not been identified as a mate- rial risk factor in the Group’s risk assessment (see section Risk factors). Yet, and as a safeguard, internal procedures are in place to anticipate, identify and prevent any infringement on employees’ human rights and freedoms. These include, for instance, clear rules against any form of discrimination along with anti-harassment and anti-bullying practices including a whistleblowing hotline accessible / to all employees. The Group indeed stands against racism, discrimination, and bias of any kind, striving to ensure that everyone feels equally wel- come and embraced. These principles are clearly stated in the Group Code of Conduct applicable to all employees. The Group has a zero-tolerance principle for violations of these rules (see section Conduct and Compliance in the Chap- ter Report of the Board of Directors). VGP makes sure to cul- tivate a sound work environment in which employees thrive (see section .. “Employee commitments and ESG”). The Group’s framework aims to fully embed VGP’s commitment to ensure equal opportunities and greater diversity and inclusion across the business (see section .. “Diversity”). VGP also cares about the protection of human rights in its value chain, and tackles this issue through the implementation of a due diligence process that identifies sustainability risks (includ- ing social and human rights risks) across its different pur- chasing categories and addresses them through mitigation actions. For example, main tenders are subject to a “Supplier Due Diligence” screening process, and all contracts require the acceptance of the Group’s Purchasing Conditions, includ- ing provisions on human rights and labour standards based on the ILO conventions and international human rights standards. For further information on the Group’s policies and actions to uphold human rights in its supply chain, please refer to sec- tions “Responsible supply chain” of the risk table in .. ESG Risks and opportunities and . Sustainable Supply Chain Management.

Bribery/Corruption

The Group has implemented robust internal mechanisms to anticipate, monitor and counter any risks of engaging in prac- tices that could amount to corruption or bribery, through the Group Compliance program and the Group Code of Conduct. Additionally, all employees are trained to identify and distin- guish situations that could be associated with corruption, with a clear communication of our zero-tolerance principle for any violation. For further information on the Group’s policies and commitments against corruption, bribery and fraud, please refer to sections “Business Ethics” of the risk table in .. ESG risks and opportunities, and the section ‘Conduct and Compli- ance in the Chapter Report of the Board of Directors.

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Taxation

The Group complies with the spirit and the letter of tax law and regulations. The Group’s tax policy, which is published in the annual report is regularly updated, describes the principles governing VGP’s approach to tax and the processes in place to ensure efficiency of these principles. These principles are also summarized in section Legal and regulatory risks in the Chap- ter ‘Risk Factors. In essence, the tax position of VGP reflects the geographical location of its real estate portfolio and is consistent with the normal course of its business operations. The tax strategy and tax risks are followed and monitored by a team of internal and external experts and discussed with an internal committee whose members include the CEO and the CFO and the Group’s auditors. The aim of the Group is to operate the business with low levels of tax risks. This is being done by ensuring that the tax consequences of arrangements entered into are being understood, including the way those arrangements will likely be viewed by relevant tax authorities. Only arrangements that are considered as acceptable to the relevant tax authorities are entered into.

Fair competition

The Group implements policies to anticipate and avoid engag- ing in any practice that could amount to a violation of fair com- petition and anti-trust regulations (See section Legal and regulatory risks in the Chapter ‘Risk Factors.Most exposed employees are educated and are expected to comply with all the competition and anti-trust laws as well as internal policies such as the Code of Conduct. If and when applicable, VGP is committed to fully co-operate with local authorities to preserve market integrity.

VGP liability and absence of convictions

VGP has developed an internal tracking methodology to scan news outlets and relevant platforms to identify whether the Group is involved in any ongoing litigation or proceeding. VGP has not been assigned or convicted for human rights violations or any offence related to anti-trust regulations or corruption. VGP has never been found guilty of tax evasion in any of the countries it operates in.

VGP share of aligned activities

European Commission Reporting Templates

The tables hereafter present taxonomy alignment figures based on total activity denominators (including non-eligible activities), in IFRS methodology only, and including service charge income lines in numerators and denominators, in the format set by the European Commission. To calculate the share of alignment of service charge income (charges refunded to the tenants) in the Revenues table, a pro rata methodology has been used because their consolidated computation on an asset per asset was not available to screen the aligned lines: the share of gross rental income from aligned assets among the total portfolio of eligible standing assets has been applied to the total of service charge and property and facility management income to report the amount of aligned service charge and property and facility management income reinvoiced to the tenants.

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Revenue KPI – VGP NV Consolidated

Economic activities Code	Absolute revenue (€ 000)	Proportion of revenue	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
7.1 Construction of new buildings	—	0.0%	100%	YES	YES	YES	YES	YES	YES	YES	0.0%
7.7 Acquisition and ownership of buildings	980	0.9%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	0.9%
7.7 Acquisition and ownership of buildings	56	0.0%	100%	YES	YES	YES	YES	YES	YES	YES	0.0%
7.6 Installation, maintenance and repair of renewable energy technologies	124	0.1%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	0.1%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	4,412	3.9%
7.7 Acquisition and ownership of buildings	103,969	91.4%
7.6 Installation, maintenance and repair of renewable energy technologies	4,237	3.7%

Revenue KPI – Proportional (including JVs at share)

Economic activities Code	Absolut revenue (€ 000)	Proportion of revenue	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A. Environmentally sustainable activities(Taxonomy-aligned)
7.1 Construction of new buildings	505	0.2%	100%	YES	YES	YES	YES	YES	YES	YES	0.2%
7.7 Acquisition and ownership of buildings	8,840	3.7%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	3.7%
7.6 Installation, maintenance and repair of renewable energy technologies	124	0.1%	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	0.1%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	4,412	1.8%
7.7 Acquisition and ownership of buildings	221,077	92.4%
7.6 Installation, maintenance and repair of renewable energy technologies	4,237	1.8%

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Revenue KPI – VGP NV Consolidated

Economic activities Code	Absolute revenue (€ 000)	Proportion of revenue	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
7.1 Construction of new buildings	—	0.0%	100%	YES	YES	YES	YES	YES	YES	YES	0.0%
7.7 Acquisition and ownership of buildings	980	0.9%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	0.9%
7.7 Acquisition and ownership of buildings	56	0.0%	100%	YES	YES	YES	YES	YES	YES	YES	0.0%
7.6 Installation, maintenance and repair of renewable energy technologies	124	0.1%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	0.1%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	4,412	3.9%
7.7 Acquisition and ownership of buildings	103,969	91.4%
7.6 Installation, maintenance and repair of renewable energy technologies	4,237	3.7%

Revenue KPI – Proportional (including JVs at share)

Economic activities Code	Absolut revenue (€ 000)	Proportion of revenue	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A. Environmentally sustainable activities(Taxonomy-aligned)
7.1 Construction of new buildings	505	0.2%	100%	YES	YES	YES	YES	YES	YES	YES	0.2%
7.7 Acquisition and ownership of buildings	8,840	3.7%	100%	YES	YES	N/A	N/A	N/A	N/A	YES	3.7%
7.6 Installation, maintenance and repair of renewable energy technologies	124	0.1%	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	0.1%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	4,412	1.8%
7.7 Acquisition and ownership of buildings	221,077	92.4%
7.6 Installation, maintenance and repair of renewable energy technologies	4,237	1.8%

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CAPEX KPI – VGP NV Consolidated

Economic activities Code	Absolute CAPEX (€ 000)	Proportion of CAPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
7.1 Construction of new buildings	1,042	0.1%	100%	YES	YES	YES	YES	YES	YES	YES	0,1%
7.7 Acquisition and ownership of buildings	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	2,294	0.3%	100%	YES	YES	YES	YES	YES	YES	YES	0,3%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	691,817	95.3%
7.7 Acquisition and ownership of buildings	—	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	30,661	4.2%

CAPEX KPI – Proportional (including JVs at share)

Economic activities Code	Absolute CAPEX (€ 000)	Proportion of CAPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
7.1 Construction of new buildings	1,042	0.1%	100%	YES	YES	YES	YES	YES	YES	YES	0,1%
7.7 Acquisition and ownership of buildings	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	2,294	0.3%	100%	YES	YES	YES	YES	YES	YES	YES	0,3%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	691,817	95.3%
7.7 Acquisition and ownership of buildings	—	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	30,661	4.2%

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EU TAXONOMY

CAPEX KPI – VGP NV Consolidated

Economic activities Code	Absolute CAPEX (€ 000)	Proportion of CAPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
E A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
7.1 Construction of new buildings	1,042	0.1%	100%	YES	YES	YES	YES	YES	YES	YES	0,1%
7.7 Acquisition and ownership of buildings	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	2,294	0.3%	100%	YES	YES	YES	YES	YES	YES	YES	0,3%
E A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
7.1 Construction of new buildings	691,817	95.3%
7.7 Acquisition and ownership of buildings	—	N/A
7.6 Installation, maintenance and repair of renewable energy technologies	30,661	4.2%

GREEN FINANCING OF THE GROUP ACTIVITIES

CAPEX KPI

– Proportional (including JVs at share)

Economic activities	Code	Absolute CAPEX (€ 000)	Proportion of CAPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Construction of new buildings	7.1	1,042	0.1%		YES	YES	YES	YES	YES	YES	YES	0,1%	E
Acquisition and ownership of buildings	7.7	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Installation, maintenance and repair of renewable energy technologies	7.6	2,294	0.3%		YES	YES	YES	YES	YES	YES	YES	0,3%	E
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Construction of new buildings	7.1	691,817	95.3%
Acquisition and ownership of buildings	7.7	—	N/A
Installation, maintenance and repair of renewable energy technologies	7.6	30,661	4.2%

OPEX KPI

– VGP NV Consolidated

Economic activities	Code	Absolute OPEX (€ 000)	Proportion of OPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Construction of new buildings	7.1	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Acquisition and ownership of buildings	7.7	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Construction of new buildings	7.1	—
Acquisition and ownership of buildings	7.7	23,328	100.0%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

OPEX KPI

– Proportional (including JVs at share)

Economic activities	Code	Absolute OPEX (€ 000)	Proportion of OPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Construction of new buildings	7.1	142	0.2%		N/A	N/A	N/A	N/A	N/A	N/A	N/A	0,2%
Acquisition and ownership of buildings	7.7	2,490	4.4%		YES	YES	N/A	N/A	N/A	N/A	YES	4,4%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Construction of new buildings	7.1	—
Acquisition and ownership of buildings	7.7	54,591	95.4%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

CORPORATE RESPONSIBILITY REPORT

EU TAXONOMY

OPEX KPI

– VGP NV Consolidated

Economic activities	Code	Absolute OPEX (€ 000)	Proportion of OPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Construction of new buildings	7.1	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Acquisition and ownership of buildings	7.7	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Construction of new buildings	7.1	—
Acquisition and ownership of buildings	7.7	23,328	100.0%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

OPEX KPI

– Proportional (including JVs at share)

Economic activities	Code	Absolute OPEX (€ 000)	Proportion of OPEX	Climate change mitigation %	Climate change mitigation Y/N	Climate change adaptation Y/N	Water and marine resources Y/N	Circular Economy Y/N	Pollution Y/N	Biodiversity and eco-systems Y/N	Minimum safeguards Y/N	Taxonomy aligned proportion of CAPEX	Category (enabling activity)
A. Taxonomy-eligible activities
A.1 Environmentally sustainable activities (Taxonomy-aligned)
Construction of new buildings	7.1	142	0.2%		N/A	N/A	N/A	N/A	N/A	N/A	N/A	0,2%
Acquisition and ownership of buildings	7.7	2,490	4.4%		YES	YES	N/A	N/A	N/A	N/A	YES	4,4%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Construction of new buildings	7.1	—
Acquisition and ownership of buildings	7.7	54,591	95.4%
Installation, maintenance and repair of renewable energy technologies	7.6	N/A	N/A		N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

GREEN FINANCING OF THE GROUP ACTIVITIES

Green bonds

Green bond issuances

The VGP Green finance framework was introduced in 2019 as part of our strategy to diversify financing sources. The Group has decided to develop a Green Bond framework to finance new development projects, and/or standing assets which meet the environmental criteria for the construction and operational phases as defined in the “Use of Proceeds” procedure, and specified hereafter. Green Bonds are only used to finance resilient eligible assets, in line with a clear procedure for allocating funds. VGP issued its first Green Bond on the Euro market in March 2021. In January 2022, the Group issued its second Green Bond (split into two tranches) on the Euro market. These issuances are testament to the success of the Group’s integral focus on ESG as part of the organization, investments, and financing. In total, the two issuances raised €3.44 billion.

Green bond criteria

The ESG criteria associated with the Green Bonds were approved by S&P Global/CICERO. They are (i) aligned with the “Green Bond Principles” (GBP) updated in March 2020 and (ii) fit in with the Group’s ESG strategy. Proceeds from Green Bonds issued under this framework will be used exclusively to finance and/or refinance, in whole or in part, “Eligible Assets”, described in the Green Finance Framework. Proceeds can be allocated to refinance existing projects as well as finance new developments. Eligible projects include:

• renewable energy projects (i.e., onshore and off shore renewable energy facilities, including primarily solar and wind projects, but also hydrogen and geothermal energy projects)
• Category of green buildings (i.e., real estate assets with BREEAM “Very Good” certification or equivalent DGNB/ LEED rating)
• Other eligible project categories include energy efficiency (i.e., for existing or new (logistics) buildings, warehouses and technologies-related services and products), waste management (i.e., projects, investments and expenditures which promote better recycling rates), clean transportation (i.e., electric vehicle charging stations, bike facilities), and sustainable water management (i.e., reduce freshwater consumption, capturing and recycling rainwater, green roofing)

Additional criteria and indicators to be monitored for eligible assets – including EU Taxonomy and CRREM, also referring to section 6.1 on EU Taxonomy and section 5.5.2 on CRREM respectively – are published on the Investor Relations’ website under the following link: https://www.vgpparks.eu/en/investors/financial-debt/

Current allocation of green bond proceeds

In line with the Group’s internal Green Bond analysis, selection and monitoring procedure, the funds generated by Green Bonds issuances are allocated to the selected assets based on a previously defined list of “eligible assets”. The criteria are presented above and explained in detail in the Green Finance Framework as available on the Group website. In the case of an asset disposal (both in full or partially) to one of the Group’s Joint Ventures during the funding period (i.e. prior to the bond issue maturity), the proceeds initially allocated to the disposed asset shall be reallocated to another “eligible asset” held by the Group, based on the same process.In case of a full disposal the equivalent asset base shall be reallocated and in case of a disposal to one of the Joint Ven- tures the remaining equity interest shall be reflected in the pro-rata asset allocation.

CORPORATE RESPONSIBILITY REPORT

GREEN BONDS

The allocation of the proceeds from the outstanding Green Bonds as at 31 December 2023 is illustrated below:

For reference: Use of categories	Green Bond – April 2029		Green Bond – Jan 2027		Green Bond – Jan 2030		EIB loan allocation (€)
	Net bond proceeds allocation (€)	% of total net bond proceeds	Net bond proceeds allocation (€)	% of total net bond proceeds	Net bond proceeds allocation (€)	% of total net bond proceeds
Renewable Energy	63,037,369	10.5%	—	0.0%	—	0.0%	44,809,712
Green buildings	752,829,611	125.5%	652,838,768	130.6%	861,878,614	172.4%
o/w min excellent or gold-rated	518,497,981	86.4%	518,501,517	103.7%	500,514,527	100.1%
Energy Efficiency	26,274,163	4.3%	—	0.0%	—	0.0%
Waste Management	—	0.0%	—	0.0%	—	0.0%
Clean Transportation	658,209	0.1%	—	0.0%	—	0.0%
Sustainable Water Management	2,702,350	0.5%	—	0.0%	—	0.0%
(over)/ unallocated	(245,501,701)	(40.8)%	(152,838,768)	(30.6)%	(361,878,614)	(72.4)%	90,190,288
(over)/ unallocated excl BREEAM Very Good or equivalent	11,170,701		(18,501,517)		(514,527)
Total gross proceeds	600,000,000	100.0%	500,000,000	100.0%	500,000,000	100.0%	135,000,000

The allocation of the proceeds between CAPEX and refinancing:

Type of financing	Grand Total (€)	%
CAPEX financing 2021	656,853,160	41%
CAPEX financing 2022	789,015,636	49%
CAPEX financing 2023	291,031,580	18%
Refinancing	622,824,228	39%
Total	2,359,724,603	147%
Over/(under) allocation	759,724,603	47%
Total gross proceeds	1,600,000,000	100%

With regards to EU Taxonomy compliance, 8% of the proportional investments are in compliance with EU Taxonomy and the Group is conducting a review of several more assets in its portfolio for alignment with EU Taxonomy. As a consequence, the aligned portion of the portfolio with EU Taxonomy is expected to grow substantially in the coming period.

Alignment with EU Taxonomy based on proportional share of investment Dec.23

	%
Use of proceeds aligned with EU Taxonomy	8%
Incl. proceeds under review/being certified for EU Taxonomy alignment	18%
Use of proceeds eligible for EU Taxonomy (alignment to be assessed)	82%
Use of proceeds not aligned with EU Taxonomy	—
Total	100%

VGP NV ANNUAL REPORT

GREEN FINANCING OF THE GROUP ACTIVITIES

5.1.3 Green bond – April 2019

Green buildings allocation by certification type (€ – proceeds allocation)

Country	BREEAM – Outstanding	BREEAM – Excellent	DGNB – Platinum	DGNB/OGNI – Gold	Grand Total	%
Austria	—	—	—	64,565,056	64,565,056	12%
Croatia	—	—	—	—	—	0%
Czechia	—	—	—	—	—	0%
Denmark	—	—	—	—	—	0%
France	—	—	—	—	—	0%
Germany	—	—	—	429,589,024	429,589,024	83%
Hungary	—	—	—	—	—	0%
Italy	—	3,011,172	—	—	3,011,172	1%
Latvia	—	—	—	—	—	0%
Netherlands	—	—	—	—	—	0%
Portugal	—	—	—	—	—	0%
Romania	—	18,374,282	—	—	18,374,282	4%
Serbia	—	—	—	—	—	0%
Slovakia	—	—	—	—	—	0%
Spain	—	2,958,448	—	—	2,958,448	1%
Grand Total	24,343,902	—	494,154,079	518,497,981	836,349,774
% of total	1%	0%	3%	0%	59%	83%

Renewable energy specification (€ proceeds allocation)

Country	2021	2022	2023	Total	Total (Apr ’29 Bond)
Austria	—	—	—	—	—
Croatia	—	—	—	—	—
Czech Republic	—	73,038	2,869,960	2,942,998	73,038
France	—	—	—	—	—
Germany	19,072,084	30,270,609	36,904,646	86,247,339	49,342,693
Hungary	84,909	—	—	84,909	84,909
Italy	—	704,348	3,131,513	3,835,861	704,348
Latvia	—	—	—	—	—
Netherlands	5,309,425	6,644,132	835,417	12,788,974	11,953,557
Portugal	—	—	—	—	—
Romania	—	530,824	1,068,176	1,599,000	530,824
Serbia	—	—	—	—	—
Slovakia	—	—	—	—	—
Spain	—	348,000	—	348,000	348,000
Total	24,466,418	38,570,951	44,809,712	107,847,081	63,037,369

Sustainable Water Management (€ proceeds allocation)

Country
Czech Republic	185,354
Germany	2,341,996
Netherlands	175,000
Total	2,702,350

¹ As % of total allocation to the bond (incl over-allocation).

CORPORATE RESPONSIBILITY REPORT

GREEN BONDS

5.1.4 Green bond – January 2027

Green buildings allocation by certification type in euros invested

Green buildings specification – € proceeds allocation per sustainable certification level by country

Country	BREEAM – Outstanding	BREEAM – Excellent	DGNB – Platinum	DGNB/OGNI – Gold	Grand Total	%
Austria	—	—	—	—	—	0%
Croatia	—	—	—	—	—	0%
Czechia	—	—	—	—	—	0%
Denmark	—	—	—	—	—	0%
France	—	—	—	—	—	0%
Germany	—	—	56,414,224	413,558,655	469,972,879	91%
Hungary	—	—	—	—	—	0%
Italy	—	3,641,157	—	—	3,641,157	1%
Latvia	—	—	—	—	—	0%
Netherlands	—	—	—	—	—	0%
Portugal	—	44,887,482	—	—	44,887,482	9%
Romania	—	—	—	—	—	0%
Serbia	—	—	—	—	—	0%
Slovakia	—	—	—	—	—	0%
Spain	—	—	—	—	—	0%
Grand Total	48,528,639	56,414,224	413,558,655	518,501,517	652,838,768
% of total	1%	0%	6%	7%	49%	652,838,768

5.1.5 Green bond – January 2030

Green buildings allocation by certification type in euros invested

Green buildings specification – € proceeds allocation per sustainable certification level by country

Country	BREEAM – Outstanding	BREEAM – Excellent	DGNB – Platinum	DGNB/OGNI – Gold	Grand Total	%
Austria	—	—	—	105,376,919	105,376,919	20%
Croatia	—	—	—	—	—	0%
Czechia	—	36,638,240	—	—	36,638,240	7%
Denmark	—	—	—	—	—	0%
France	—	—	—	—	—	0%
Germany	—	—	—	255,966,862	255,966,862	49%
Hungary	—	—	—	—	—	0%
Italy	—	—	—	—	—	0%
Latvia	—	—	—	—	—	0%
Netherlands	—	—	—	—	—	0%
Portugal	—	17,103,590	—	—	17,103,590	3%
Romania	11,834,453	34,454,989	—	—	46,289,442	9%
Serbia	—	—	—	—	—	0%
Slovakia	—	—	—	—	—	0%
Spain	—	39,139,474	—	—	39,139,474	8%
Grand Total	11,834,453	127,336,293	—	361,343,782	500,514,527
% of total	2%	1%	15%	0%	43%	861,878,614

¹ As % of the total allocation to the bond (including over-allocation).
² As % of the total allocation to the bond (including over-allocation).

VGP NV ANNUAL REPORT

GREEN FINANCING OF THE GROUP ACTIVITIES

5.2 Audited criteria

VGP engaged an independent auditor to verify that the assets financed meet the eligibility criteria. The reporting on these criteria and the independent auditor’s attestation on the information related to the allocation of funds are presented in the following section.

5.2.1 Annual Reporting on green bonds in compliance with framework

Renewable energy

This category includes the financing and/or refinancing of projects, investments and expenditures in products, technologies and services ranging from the generation and transmission of energy to the manufacturing of related equipment including among others onshore and offshore renewable energy facilities. This includes among others solar, wind, hydro and geothermal energy projects.

Of the 115 photovoltaic projects on VGP Parks’ roofs, 108 are owned and operated by VGP and of these 76 are included in the Green Finance Framework allocation. Of these 76 systems were operational by December 2023, representing 75 MWp and a further 32 were under construction/waiting for grid connection, representing 27 MWp. The eligible photovoltaic investments have generated green energy in 2023 for in total 44 GWh, equivalent to 19,519 tCO2e. For calculating the equivalent CO2 emissions, the average grid factor of the VGP Parks portfolio of 0.439 tCO2/MWh ¹ has been used:

Full year actual renewable energy production

	2021	2022	2023
Full year production (MWh)	8,216	27,449	44,496
Emission factor (tCO2/MWh)	0.308	0.333	0.439
Avoided emissions (tCO2)	2,529	8,450	19,519

Anticipated annual renewable energy production

	2022	2023
Full year production (MWh)	105,303	120,321
Emission factor (tCO2/MWh)	0.333	0.439
Avoided emissions (tCO2)	32,417	52,781

Please refer to the table below for the allocation of PV systems per bond and by status of the PV system (operational vs under construction):

PV capacity (KWp) Country/Park/Building code	Production existing awarded KWH p.a.	Bond allocation Apr-29	Bond allocation Jan-27	Bond allocation Jan-30
Germany VGP Park Berlin GERBER– A	745 627,698	x
VGP Park Berlin 2 GERBER2– B	746 628,811	x
GERBER2– C	750 631,930	x
VGP Park Berlin 4 GERBER4– M	1,591 1,341,044	x
VGP Park Berlin Oberkrämer GEROBK– A	299 243,889	x
GEROBK– A	849 691,691	x
GEROBK– D	639 521,078	x
VGP Park Berlin Wustermark GERWUS– A1	745 683,543	x
VGP Park Borna GERBOR– A	748 642,910	x
VGP Park Buseck GERBUS– A	749 643,020	x

¹ For each year the average emission factor for grey electricity for the VGP portfolio has been used. For an explanation of the year-over-year change in emission factor, please refer to section 5.2.2 “GHG emissions from tenant operations”.

PV capacity (KWp) Country/Park/Building code	Production existing awarded KWH p.a.	Bond allocation Apr-29	Bond allocation Jan-27	Bond allocation Jan-30
VGP Park Chemnitz GERCHE– A	746 693,706	x
VGP Park Erfurt GERERF– A	750 622,185	x
GERERF– A	1,538 1,276,125	x
VGP Park Erfurt 2 GERERF2– B	3,327 2,761,609	x
VGP Park Erfurt 3 GERERF3– A	2,451 2,034,330	x
VGP Park Gießen Am alten Flughafen GERGAF– A	7,770 7,070,245	x
GERGAF– B	1,000 909,991	x
GERGAF– B	2,399 2,183,008	x
GERGAF– PH	869 790,972	x
VGP Park Ginsheim GERGIN– A	748 672,099	x
VGP Park Göttingen GERGOE– A	750 625,367	x
GERGOE– A	747 623,031	x
GERGOE– B	—
VGP Park Göttingen 2 GERGOE2– C	3,870 3,227,580	x
GERGOE2– C	497 409,759	x
GERGOE2– C	2,244 1,871,496	x
VGP Park Halle GERHAL– A	1,830 1,661,858	x
GERHAL– B	2,303 2,090,724	x
GERHAL– C	3,365 3,055,674	x
VGP Park Halle 2 GERHAL2– A	1,328 1,205,824	x
GERHAL2– B
VGP Park Hamburg GERHAM– A1	750 586,952	x
GERHAM– A2	750 586,952	x
GERHAM– A3	—
VGP Park Hamburg 2 GERHAM2– B1	2,544 1,991,670	x
GERHAM2– B2	750 586,952	x
GERHAM2– B3	—
VGP Park Hamburg 3 GERHAM3– C	750 586,952	x
VGP Park Hochheim GERHOH– A	1,115 1,014,832	x
VGP Park Höchstadt GERHOE– A	748 662,560	x
VGP Park Koblenz GERKOB– A	3,174 2,815,338	x
VGP Park Laatzen GERLAA– A	3,624 2,917,642	x
GERLAA– B
GERLAA– C	3,567 2,871,435	x

VGP NV ANNUAL REPORT

GREEN FINANCING OF THE GROUP ACTIVITIES

PV capacity (KWp)# CORPORATE RESPONSIBILITY REPORT

 PAGE GREEN BONDS

PV capacity (KWp) Production Bond allocation

Country/Park/Building code	existing	awarded	KWH p.a.	Apr-29	Jan-27	Jan-30
GERLAA– PH Ost	375	301,875	x
VGP Park Leipzig Flughafen	GERLFH– A	299	272,064	x
	GERLFH– A	899	817,282	x
VGP Park Leipzig Flughafen 2	GERLFH2– B	2,349	2,135,241	x
VGP Park Lützellinden	GERLUE– A	748	654,080	x
VGP Park Magdeburg	GERMAG– A	750	643,174	x
	GERMAG– A	1,798	1,542,856	x
	GERMAG– B	2,244	1,925,077	x
	GERMAG– C	10,273	8,814,200	x
	GERMAG– F	4,095	3,513,510	x
VGP Park München	GERMUE– A	748	740,207	x
	GERMUE– A	1,696	1,677,423	x
	GERMUE– B	3,791	3,749,101	x
	GERMUE– C	3,003	2,970,442	x
	GERMUE– E	1,895	1,874,551	x
	GERMUE– F	97	96,131	x
	GERMUE– PH Nord	460	454,940	x
	GERMUE– PH Sud	316	312,425	x
VGP Park Rodgau	GERROD– C	746	707,132	x
VGP Park Rostock	GERROS– A	2,193	1,890,366	x
VGP Park Schwalbach	GERSCH– A	645	569,049	x
VGP Park Soltau	GERSOL– A	749	593,798	x
	GERSOL– A	2,399	1,902,407	x
VGP Park Wetzlar	GERWET– B	747	644,696	x
Italy
VGP Park Calcio	ITACAL– A	16	18,320
	ITACAL– A	3,176	3,636,806	x
VGP Park Sordio	ITASOR– A	25	28,400
	ITASOR– A	940	1,068,033	x
VGP Park Valsamoggia	ITAVAL– B	992	1,278,688	x
Netherlands
VGP Park Nijmegen	NLDNIJ– A	2,279	2,096,993	x
	NLDNIJ– A	1,518	1,396,762	x
	NLDNIJ– A	1,012	930,764	x
	NLDNIJ– E
VGP Park Nijmegen 2	NLDNIJ2– B1B2	869	799,020	x
	NLDNIJ2– B1B2	2,213	2,036,328	x
	NLDNIJ2– B3B4	5,940	5,464,800	x
	NLDNIJ2– C	3,779	3,476,680	x
VGP Park Roosendaal	NLDROO– A	3,899	3,579,392	x
Spain
VGP Park Fuenlabrada	ESPFUE– A	100	134,300	x
VGP Park Lliçà dAmunt	ESPLLI– A	46	57,927	x
	ESPLLI– C	78	98,580	x
	ESPLLI– D	83	105,780	x
VGP Park San Fernando de Henares	ESPSFH– A	53	69,405	x
	ESPSFH– B1	63	82,625	x
	ESPSFH– C1	36	47,116	x
	ESPSFH– D1	20	26,440	x
	ESPSFH– E	18	23,796	x
VGP Park Valencia Cheste	ESPVAL– A	33		x
	ESPVAL– B	66		x
Grand Total		86,309	48,422	120,321,463	0	0

Please refer to section .. Energy Management and specifically ... Production of Renewable Energy for further information on the Group’s initiatives and KPIs with respect to renewable energy production.

... Green buildings

Definition of the framework

The framework defines eligible the financing and/or refinancing of projects, investments and expenditures in relation to real estate assets which have received, or are designed and intended to receive, BREEAM “Very Good” certification (or equivalent DGNB Silver/LEED Silver rating). In total  eligible building projects have been identified and allocated under the Green Financing framework. This Green build- ing portfolio has predominantly been built since  or is currently under construction. Given this is such a new portfolio it ben- efits from the latest ESG features of our building standard and green energy sourcing. As a reflection of the year-over-year improvement of the quality of the portfolio, the building allocation has been upgraded to cover the required amount through buildings with a green building certification of BREEAM Excellent or DGNB Gold or better.

CRREM and .°C pathway

The Group has analysed various asset specific and portfolio-based solutions to improve the stranding date. Based on the retrofit plans, heat pump initiatives, photovoltaic roll-out and green electricity transition an upgrade to .°C pathway compliance until  is envisaged. Further details are included in section ... CRREM retrofit and improvement actions.

Upgrade to minimum BREEAM Excellent or DGNB Gold allocation

The  eligible building projects have been identified and allocated to the three outstanding green bonds which is shown in the table below. The table also shows the certification level as well as status of the certification process. The BREEAM Excellent or DGNB Gold rated buildings have been taken as a minimum to allocate the bonds in full. Due to employed certification pre-checks and uniform VGP building standard being employed for all construction projects across Europe a very high degree of confidence can be expressed for expected realisation of the targeted certification level in case this is not yet completed. In case a project would not achieve the required certification level it will be removed from the eli- gible green buildings investments portfolio.

EPC

Of the completed building portfolio which is part of the net proceeds allocation of the green bonds and which has obtained an EPC rating as of  December , % has received an energy EPC B score or better  . In light of EU Taxonomy reviews existing EPC scores continue to be reviewed and updated (as the initial ECP rating from the development phase not always reflects all retrofits or investments in eco-efficiency conducted since).  Given no EPC letter score is available in Germany the (conservative) residential equivalent score has been used with end-use energy below  KWh/m/ annum EPC A – https://eurodw.eu/the-babel-tower-of-energy-performance-certificate-ratings-and-databases-in-europe/

PAGE 

VGP NV ANNUAL REPORT 

GREEN FINANCING OF THE GROUP ACTIVITIES

Building	Certification	Allocation Code	GLA (m²)	Level	Status	Green Bond – April 2029	Green Bond – Jan 2027	Green Bond – Jan 2030
AUTEHR– A	ÖGNI– Gold		39,813		Ongoing			x
AUTEHR– B	ÖGNI– Gold		33,146		Ongoing		x
AUTEHR– C	ÖGNI– Gold		7,585		Ongoing			x
AUTGRA– A	BREEAM– Very Good		16,537		Ongoing			x
AUTGRA2– B	ÖGNI– Gold		8,212		Realized	x
AUTGRA2– C	ÖGNI– Gold		14,348		Ongoing			x
AUTLAX– A	ÖGNI– Gold		26,076		Ongoing			x
AUTLAX– B	ÖGNI– Gold		23,372		Ongoing		x
CZECEB– A	BREEAM– Excellent		5,917		Ongoing			x
CZECEB– B	BREEAM– Excellent		8,749		Ongoing		x
CZECEB– C	BREEAM– Very Good		9,424		Realized	x
CZECEB– D	BREEAM– Excellent		14,004		Ongoing			x
CZECEB– E	BREEAM– Excellent		48,313		Ongoing		x
CZEHNN– H1	LEED– Silver		40,361		Realized	x
CZEHNN2– H6	BREEAM– Very Good		30,215		Realized	x
CZEKLA– A	BREEAM– Very Good		15,806		Realized	x
CZEKLA– B	BREEAM– Very Good		11,193		Realized	x
CZEOLO3– M	BREEAM– Excellent		8,665		Ongoing			x
CZEOLO4– E	BREEAM– Excellent		4,269		Ongoing		x
CZEOLO5– F	BREEAM– Very Good		65,889		Realized	x
CZEPIL– E	BREEAM– Very Good		5,790		Realized	x
CZEPRO– A	BREEAM– Very Good		15,330		Realized	x
CZEPRO– B	BREEAM– Very Good		25,055		Realized	x
CZEPRO– C	BREEAM– Excellent		10,351		Ongoing			x
CZEUST2– A	BREEAM– Very Good		22,813		Ongoing		x
CZEUST2– B	BREEAM– Very Good		29,309		Ongoing			x
CZEVYS– A	BREEAM– Very Good		28,868		Realized	x
ESPCOR– A	BREEAM– Excellent		15,419		Ongoing			x
ESPCOR– B	BREEAM– Excellent		7,218		Ongoing		x
ESPDOH– B	BREEAM– Very Good		29,091		Realized	x
ESPFUE– A	BREEAM– Very Good		41,752		Realized	x
ESPGRA– A	BREEAM– Very Good		8,920		Realized	x
ESPLLI– A	BREEAM– Very Good		13,639		Realized	x
ESPLLI– D	BREEAM– Very Good		7,205		Realized	x
ESPLLI– E	BREEAM– Very Good		22,195		Realized	x
ESPMAR– A	BREEAM– Excellent		10,102		Ongoing			x
ESPSEV– A	BREEAM– Excellent		15,057		Ongoing		x
ESPSEV– B	BREEAM– Excellent		13,530		Ongoing			x
ESPSFH– C1	BREEAM– Very Good		7,947		Realized	x
ESPSFH– C2	BREEAM– Very Good		5,165		Realized	x
ESPSFH– D1	BREEAM– Very Good		11,453		Realized	x
ESPSFH– D2	BREEAM– Excellent		27,579		Realized	x
ESPVAL– A	BREEAM– Very Good		14,177		Realized	x
ESPVAL– B	BREEAM– Very Good		25,409		Realized	x
ESPVAL– C	BREEAM– Excellent		25,517		Ongoing			x
ESPZAR– A	BREEAM– Very Good		18,074		Realized	x
ESPZAR– B	BREEAM– Very Good		21,373		Realized	x
ESPZAR– C1	BREEAM– Very Good		22,556		Realized	x
ESPZAR– C2	BREEAM– Very Good		13,616		Realized	x
ESPZAR– D	BREEAM– Excellent		19,146		Ongoing			x
GERBER4– M	DGNB– Gold		17,337		Realized	x
CORPORATE RESPONSIBILITY REPORT  PAGE GREEN BONDS	Building	Certification	Allocation Code	GLA (m²)	Level	Status	Green Bond – April 2029	Green Bond – Jan 2027
---	---	---	---	---	---	---	---	---
GERERF– A	DGNB– Gold		26,214		Ongoing			x
GERERF2– B	DGNB– Gold		41,815		Ongoing		x
GERERF3– A	DGNB– Gold		29,183		Ongoing			x
GERFRA– A	BREEAM– Very Good		146,898		Realized	x
GERGAF– A1	DGNB– Gold		124,922		Ongoing			x
GERGAF– A2	DGNB– Gold		28,352		Ongoing		x
GERGAF– B	DGNB– Gold		59,150		Ongoing			x
GERGOE2– C	DGNB– Gold		80,157		Realized	x
GERHAL– B	DGNB– Gold		26,848		Realized	x
GERHAL– C	DGNB– Gold		37,933		Realized	x
GERHAL2– A	DGNB– Gold		14,862		Ongoing			x
GERHDW– A	DGNB– Gold		20,465		Ongoing		x
GERHDW– B	DGNB– Gold		29,139		Ongoing			x
GERHDW– C	DGNB– Gold		25,850		Ongoing		x
GERHDW2– A	DGNB– Gold		43,471		Initiation			x
GERHOH– A	DGNB– Gold		12,025		Ongoing		x
GERKOB– A	DGNB– Gold		32,377		Ongoing			x
GERLAA– A	DGNB– Platinum		55,398		Realized	x
GERLAA– B	DGNB– Platinum		11,803		Realized	x
GERLAA– C	DGNB– Gold		51,262		Realized	x
GERLAA– D	DGNB– Gold		8,519		Realized	x
GERLEI– C1	DGNB– Gold		2,519		Realized	x
GERLEI– C2	DGNB– Gold		2,379		Realized	x
GERLFH– A	DGNB– Gold		16,298		Ongoing			x
GERLUE– A	DGNB– Gold		14,156		Realized	x
GERMAG– A	DGNB– Gold		31,869		Realized	x
GERMAG– B	DGNB– Gold		42,368		Ongoing			x
GERMAG– C1	DGNB– Gold		67,376		Ongoing		x
GERMAG– D	DGNB– Gold		74,045		Ongoing			x
GERMAG– F	DGNB– Gold		51,995		Ongoing		x
GERMUE– A	DGNB– Gold		56,874		Realized	x
GERMUE– B	DGNB– Gold		81,549		Ongoing			x
GERMUE– C	DGNB– Gold		48,471		Ongoing		x
GERMUE– E	DGNB– Gold		39,352		Ongoing			x
GERMUE– F	DGNB– Gold		7,487		Ongoing		x
GEROBK– A	DGNB– Gold		13,717		Realized	x
GEROBK– B	DGNB– Gold		11,502		Realized	x
GEROBK– C	DGNB– Gold		9,086		Ongoing			x
GEROBK– D	DGNB– Gold		24,223		Realized	x
GERROS– A	DGNB– Gold		20,447		Ongoing		x
GERSOL– A	DGNB– Gold		55,813		Realized	x
GERWUS– A1	DGNB– Gold		10,997		Realized	x
HRVLUC– A	BREEAM– Very Good		36,867		Ongoing			x
HUNBUD– A	BREEAM– Very Good		29,853		Ongoing		x
HUNBUD– B.1	BREEAM– Very Good		11,015		Realized	x
HUNBUD– C1.1	BREEAM– Very Good		13,544		Ongoing			x
HUNGYO2– A	BREEAM– Very Good		37,998		Ongoing		x
HUNGYO2– B	BREEAM– Very Good		13,915		Ongoing			x
HUNKEC– A	BREEAM– Very Good		21,937		Ongoing		x
HUNKEC– C	BREEAM– Very Good		20,149		Ongoing			x
ITACAL– A			23,303

Building Certification

Code	GLA (m²)	Level	Status	Green Bond – April 2029	Green Bond – Jan 2027	Green Bond – Jan 2030
ITAPAD	15,301	BREEAM– Very Good	Realized	x
ITAPAD	7,246	BREEAM– Very Good	Realized	x
ITAPAR2	5,710	BREEAM– Excellent	Realized	x
ITASOR	12,035	BREEAM– Very Good	Realized	x
ITAVAL	6,679	BREEAM– Excellent	Realized	x
ITAVAL	16,106	BREEAM– Very Good	Realized	x
LVARIG	7,030	BREEAM– Very Good	Ongoing	x
LVATIR	28,897	BREEAM– Very Good	Realized	x
NLDNIJ	67,352	BREEAM– Very Good	Realized	x
NLDNIJ2	42,505	BREEAM– Very Good	Ongoing	x
NLDNIJ2	62,520	BREEAM– Very Good	Ongoing	x
NLDNIJ2	35,052	BREEAM– Very Good	Ongoing	x
NLDROO	41,960	BREEAM– Very Good	Realized	x
NLDROO	9,294	BREEAM– Very Good	Realized	x
PRTLOU	12,606	BREEAM– Excellent	Ongoing	x
PRTLOU	7,143	BREEAM– Excellent	Ongoing	x
PRTMON	31,789	BREEAM– Excellent	Ongoing	x
PRTSIN	12,901	BREEAM– Excellent	Ongoing	x
PRTSMF	29,813	BREEAM– Very Good	Realized	x
ROMARA	29,414	BREEAM– Very Good	Realized	x
ROMARA	40,081	BREEAM– Excellent	Ongoing	x
ROMBRA	28,956	BREEAM– Very Good	Realized	x
ROMBRA	20,920	BREEAM– Excellent	Ongoing	x
ROMBRA	13,812	BREEAM– Excellent	Ongoing	x
ROMBRA	9,556	BREEAM– Very Good	Realized	x
ROMBRA	17,465	BREEAM– Excellent	Realized	x
ROMBUC	30,507	BREEAM– Very Good	Realized	x
ROMBUC	15,699	BREEAM– Outstanding	Realized	x
ROMTIM2	30,775	BREEAM– Very Good	Realized	x
ROMTIM3	32,768	BREEAM– Excellent	Ongoing	x
SVKBRA	57,328	BREEAM– Very Good	Realized	x
SVKBRA	19,201	BREEAM– Very Good	Ongoing	x
SVKBRA	18,354	BREEAM– Very Good	Realized	x

Please refer to section 5.1.3. Sustainable Properties and more specifically 5.1.3.2. Environmental certifications for additional details on the Group’s certification initiatives.

5.1.3.1. Energy efficiency

The financing and/or refinancing of projects, investments and expenditures focusing on Energy Efficiency measures in existing or new (logistics) buildings, warehouses and technologies (insulation, LED relighting, motion detectors, energy monitoring tools etc.) and related services and products. Whilst not all eco-efficiency measures have been separately accounted for the measures identified include air heat pumps, energy saving LED investments, sun protection and moving sensors in offices to reduce energy consumption. These expenditures and refurbishments in 22 buildings have resulted in ca. €17 million of additional eligible investments, the proportional eligible spent amounts to €13 million. Properly sized heat pump installations instead of gas-powered heating help reduce the gas consumption of our buildings. Furthermore, such HVAC installations allow more easily to heat of cool different areas of the warehouse separately depending on occupancy and use. Automated controls further help optimize the operation of HVAC systems based on occupancy schedules and temperature settings in offices.

CORPORATE RESPONSIBILITY REPORT

5.1.3.1.1. Energy efficiency measures

	2023
Avoided energy consumption (MWh)	35,317
Emission factor (tCO2/MWh)	0.058
Avoided emissions (tCO2)	2,054

The emission factor is weighted emission factor based on the effective net kWh savings in electricity and gas against portfolio average emission factors of electricity (0.276 tCO2/MWh) and gas (0.1978 tCO2/MWh). For heat pumps an annualized Coefficient of Performance (CoP) of 3.4 is assumed. Details on the energy efficiency measures and related KPIs are discussed in more detail in section 5.2. Improving eco-efficiency.

5.1.3.2. Waste management

The financing and/or refinancing of projects, investments and expenditures which promote better recycling rates. The Group did not isolate any investments made specifically related to waste management. Please refer to section 5.2.1.5 Waste Management for further information on the Group’s waste management user data and KPIs and waste management improvement initiatives.

5.1.3.3. Clean transportation

The financing and/or refinancing of projects, investments and expenditures which promote clean transportation (electric vehicle charging stations, bike facilities, etc.). The Group has set the target to developing connectivity and sustainable mobility for each VGP Park to be equipped with EV charging and public transport access. The reported investments in electric charging facilities in the VGP Parks in 2023 amounts to € 1.6 million in 24 VGP Parks locations, reflecting the locations where EV chargers have been installed and cost base could be isolated. The proportional eligible spent amounts to €0.98 million. Based on the limited sites for which charging data is available the total kWh charged at the sites is 110,000 kWh per annum.

EV charging infrastructure

	2023
Total EV charging (MWh)	299
Assumed car KMs covered	1,573,000
Avoided emissions (kgCO2/km)	0.050
Avoided emissions (tCO2)	79

please note this data is based on a gross-up of sites for which charging data is available

Developing connectivity and sustainable mobility within VGP Parks is one of the key ESG targets of the Group. Further details can be found in section 5.2.1.6 Develop connectivity and sustainable mobility.

1 Based on assumed 0.16 kwh/km average reach of new European BEVs (€25,000 new price). Source: https://alternative-fuels-observatory.ec.europa.eu/general-information/vehicle-types.
2 Based on the emission factor for diesel vehicles (0.17 kgCO2/KM) minus the emission factor for grey electricity (0.019 kgCO2/KM) for charging EV vehicles (weighted according to car use in VGP countries).

5.1.3.4. Sustainable Water Management

The financing and/or refinancing of projects, investments and expenditures which promote a sustainable water man- agement (reduce freshwater consumption, capturing and recycling rain water, green roofing etc.).

Selected eligible projects:	Sustainable Water Management	Green Bond – April 2029	Green Bond – Jan 2027	Green Bond – Jan 2030
VGP Park Munchen	Infiltration basin south incl. plants / vegetation	x
VGP Park Gottingen	Rainwater channels with rainwater retention basin	x
VGP Park Buseck	Use of rainwater for toilet facilities (cistern, piping, separation systems, technology) and Infiltration of rainwater in the rainwater retention basin	x
VGP Park Magdeburg	Rainwater channels with large rainwater retention basin combined and connected (through transport trenches) with several smaller basins with overflow and throttling system	x
VGP Park Roosendaal	Infiltration crates, installation built under building for water overflow and retention (independent of public sewerage)	x
VGP Park Berlin	Entire green roof for water retention and bio-diversity stimulation	x
VGP Park Kladno	Rainwater channels with rainwater retention basin	x
VGP Park České Budějovice	Rainwater channels with rainwater retention basin	x

In 2023, the water management projects collected 170,000 m3 of rainwater/greywater on site, which were partially used for cleaning and for watering green spaces. Please refer to section 5.2.1.7 Water Management for further information on the Group’s water management user data and KPIs and water management improvement initiatives.

5.1.4. Independent third party’s report on green bond criteria and indicators

VGP has commissioned Cicero Shades of Green, part of S&P Global, as a third-party reviewer to check the allocation against the Green Finance Framework criteria and impact metrics for relevance and transparency. The attestation on the information related to the allocation of funds from Cicero Shades of Green is available hereafter. The original document is also available on VGP’s website.

Community Day Czech Republic 2023

5.2. VGP External Review of Green Finance Reporting

March 6, 2024

This report was produced by S&P using Shades of Green Methodology. On December 1, 2021, S&P Global acquired Shades of Green from CICERO. S&P Global has reviewed the elements of VGP’s Corporate Responsibility Report 2023 (“Report”) relating to its green financing activities. We review against VGP’s Green Finance Framework (dated March 2023, the “Framework”) criteria, and impact metrics for relevance and transparency. We consider that the allocations in the Report align with the Framework. Note that, according to the Report, around 25% of assets in VGP’s green portfolio are green buildings. The green buildings project category received a Light Green in our Second Party Opinion. Based on the Shades of Green allocated to the project categories, the investments in VGP’s green portfolio are not therefore, on the whole, representative of the Medium Green shading awarded to the Framework in our Second Party Opinion. Nonetheless, we note that – generally speaking – VGP demonstrates a more holistic approach to the climactic and environmental performance of the green buildings portfolio. For example, according to VGP, the green buildings produce more renewable energy than energy con- sumed, while the green portfolio includes around EUR 1.8 billion of green buildings with BREEAM Excellent or DGNB Gold (or better) certifications, exceeding the minimum Framework requirements. We consider that the Report utilizes relevant and suffi- ciently transparent impact metrics. In an improvement on last year’s Report, VGP now includes impacts for all project categories to which proceeds have been allocated. Finally, we consider the Report aligns with the core prin- ciples and recommendations contained in ICMA’s Handbook – Harmonized Framework for Impact Reporting (June 2020).# ICMA Handbook CORPORATE RESPONSIBILITY REPORT

VGP EXTERNAL REVIEW OF GREEN FINANCE REPORTING

Project allocation

VGP has issued two green bonds under the Framework, totaling EUR 1.5 billion. The first, issued in March 2021, raised EUR 250 million, and the second, issued in January 2022, raised EUR 1.25 billion in two, EUR 625 million tranches. Allocation is reported as at December 31, 2022 with eligible assets in VGP’s green portfolio totaling around EUR 1.3 billion. In respect of allocation, we consider the Report aligned with the Framework; for a more detailed review, please see Appendix 1. The Framework was assigned an overall Medium Green in our Second Party Opinion, reflecting that, during the Second Party Opinion process, VGP noted that the main share of proceeds would be used for renewable energy projects and that proceeds would be used in a “balanced” way. Project categories were shaded Dark Green (renewable energy, waste management, clean transportation, and sustainable water and wastewater management projects), Light to Medium Green (energy efficiency), and Light Green (green buildings). Figure 1 sets out the allocations by Shade of Green, showing that around 96% of assets in VGP’s green portfolio are green buildings. Based on the Shades of Green allocated to the project categories, the investments in VGP’s green portfolio are not therefore – on the whole – representative of the Medium Green shading awarded to the Framework. Nonetheless, we note that, generally speaking, VGP demonstrates a more holistic approach to the climactic and environmental performance of its green buildings portfolio. For example: i) the green portfolio includes around EUR 1.3 billion of green buildings with BREEAM Excellent or DGNB Gold (or better) certifications, exceeding the minimum Framework requirements, ii) according to VGP, the green buildings produce more renewable energy than energy consumed, iii) investments made in energy efficiency, including under the Framework, for example the use of heat pumps as standard (where feasible), and iv) VGP expects a substantial growth in these assets that align with the EU Taxonomy as a result of ongoing alignment reviews.

VGP SPO 1

Around 77% of green buildings under the first bond, 79% of the first tranche of the second bond, and 58% of the second tranche of the second bond are (or expect to be) rated BREEAM Excellent or DGNB Gold.

Impact metrics

VGP reports impacts as at December 31, 2022. We consider that VGP provides transparent and relevant impact reporting for all project categories to which proceeds have been allocated; for a more detailed review, please see Appendix 1.

For renewable energy investments, VGP reports impacts for its 115 photovoltaic projects. More specifically, it reports the capacity, full year production, and avoided emissions. For avoided emissions, VGP is transparent on the grid factor used, namely the average grid factor of the 14 European countries in which it operates. No impacts are reported for its one geothermal investment – this is considered only a minor omission.

For green buildings, VGP lists the environmental certification for each financed building. While reporting on environmental certifications is a fair way to report impacts of green building investments, they are best reported alongside other metrics such as energy performance. As such, it represents a fair improvement that the Report includes the percentage of (completed) green buildings within the green building portfolio that have an EPC B or better. In a further improvement on last year’s Report, VGP now includes impacts for the energy efficiency and clean transportation project categories. For energy efficiency investments, VGP reports avoided energy consumption and avoided emissions derived from the projects, while for clean transportation, it provides data on total EV charging, avoided emissions, and assumed kilometers covered by car. For sustainable water management, the report provides information on collected and reused rainwater/greywater on site.

Terms

S&P Global provides a review of VGP’s annual reporting based on documentation provided by the issuer and information gathered during teleconferences and e-mail correspondence with VGP. VGP is solely responsible for providing accurate information. All financial aspects of the sustainable finance reporting – including the financial performance of the bond and the value of any investments in the bond – are outside of our scope, as are general governance issues such as corruption and misuse of funds. S&P Global does not validate nor certify the existence of investments and does not validate nor certify the climate effects of investments. Our objective has been to provide an assessment of the extent to which the bond has met the allocation and reporting criteria established in the Framework. The review is intended to inform VGP, investors and other interested stakeholders in VGP’s green bond and has been made based on the information provided to us. S&P Global cannot be held liable if estimates, findings, opinions or conclusions are incorrect. Our review does not follow verification or assurance standards and we can therefore not provide assurance that the information presented does not contain material discrepancies.

Figure 1: Allocation by SPO Shade of Green.

Shading is based on evaluation at time of issuance and does not reflect ex-post project verification.

Allocation by Shade of Green
Light Green –	96.1%
Light to medium Green –	1.1%
Dark Green –	3.5%

PAGE 75

VGP NV ANNUAL REPORT 2022

GREEN FINANCING OF THE GROUP ACTIVITIES

Appendix 2 – Detailed Review

| Category | Description # VGP EXTERNAL REVIEW OF GREEN FINANCE REPORTING

Appendix – Detailed Review

Renewable Energy

• Category Description: Projects, investments and expenditures in products, technologies and services ranging from the generation and transmission of energy to the manufacturing of related equipment including among others onshore and offshore renewable energy facilities. This includes among others solar, wind, hydro, and geothermal energy projects.
• Review against framework criteria: No discrepancies identified
• Impact Metrics:
  • The projects financed under the renewable energy project category are solar panels and one geothermal heating project.
  • Total energy generated (MWh).
  • Avoided CO emissions (tCOe).
  • Metrics are relevant and production, capacity, and avoided emissions are listed as core indicators in the ICMA Handbook– Harmonized Framework for Impact Reporting.
  • Production and avoided emissions are reported on a portfolio basis, while capacity is reported on a project basis.
  • For avoided emissions, VGP uses the average grid factor of the 14 European countries in which it operates. Transparency on this is welcome.
  • No quantitative impacts are provided for the geothermal heating project.

Green Buildings

• Category Description: Projects, investments, and expenditures in relation to real estate assets which have received, or are designed and intended to receive, BREEAM “Very Good” certification (or equivalent DGNB/LEED rating).
• Review against framework criteria: No discrepancies identified
• Impact Metrics:
  • VGP selected DGNB Silver and LEED Silver as equivalent to BREEAM Very Good. Investors should note there is no consensus about the equivalence of different certification schemes.
• In any case, the Report states that 69% of green buildings under the first bond, 79% of the first tranche of the second bond, and 58% of the second tranche of the second bond are (or expect to be) rated BREEAM Excellent or DGNB Gold. We welcome that the majority of VGP’s green building investments exceed the Framework criteria.
  • Environmental certification achieved or expected to be achieved.
  • Percentage of (completed) green buildings in the green building portfolio with EPC B or better.
  • Certification standard (including environmental certifications such as BREEAM, as well as EPCs) is listed as a core indicator in the ICMA Handbook– Harmonized Framework for Impact Reporting.
  • VGP reports environmental certification on a project basis.
• Given that environmental certifications do not guarantee, for example, a certain energy use, VGP could consider reporting on additional metrics such as energy use on an absolute and intensity basis. As such, we welcome that the Report includes the percentage of green buildings in the green buildings portfolio with EPC B or better. Going forward, VGP could consider including more contextual information to add colour to this metric, for example how it compares to local regulations. We expect this may occur in parallel with increased reporting on the EU Taxonomy alignment of the green building portfolio.

Energy Efficiency

• Category Description: Projects, investments and expenditures focusing on energy efficiency measures in existing or new (logistics) buildings, warehouses. Technologies (insulation, LED relighting, motion detectors, energy monitoring tools etc.) and related services and products, including installation.
• Review against framework criteria: No discrepancies identified
• Impact Metrics:
• According to the Report, investments under the energy efficiency category are LED investments, sun protection, and moving sensors to reduce energy consumption. VGP has also invested in heat pumps which replace gas heating.
  • Avoided energy consumption (MWh)
  • Avoided emissions (tCO)
  • Metrics are relevant and energy savings and avoided emissions are listed as core indicators in the ICMA Handbook– Harmonized Framework for Impact Reporting.
  • This is the first year that VGP reports on impacts from energy efficiency projects.
  • VGP provides information on the baselines used for calculating avoided energy consumption, and how it derives its emissions factors for calculating avoided emissions.
  • According to VGP, the calculation includes a majority, rather than all, of energy efficiency investments.

Clean Transportation

• Category Description: Electric vehicle charging stations. Bike facilities.
• Review against framework criteria: No discrepancies identified
• Impact Metrics:
  • According to the Report, investments under the clean transportation category are electric vehicle charging facilities across 36 locations.
  • Total EV charging (KWh)
  • Assumed car kilometres covered
  • Avoided emissions per km (kgCOkm)
  • Avoided emissions (tCO)
  • Metrics are relevant and/or are included in the ICMA Handbook– Harmonized Framework for Impact Reporting as either core or “other sustainability indicators”.
  • This is the first year that VGP reports on impacts from clean transportation projects.
• While the Report includes general information about the number of VGP sites with electric vehicle charging, some more precise information about the number and type of investments under the Framework could be helpful.
  • VGP provides sufficient and transparent information on how it has calculated impacts. According to the Report, the calculation is limited to sites where charging data is available.

Sustainable water and wastewater management

• Category Description: Reduction of freshwater consumption. Capturing and recycling rainwater. Green roofing.
• Review against framework criteria: No discrepancies identified
• Impact Metrics:
• The Report mentions different projects financed in this project category, such as the construction of rainwater channels with rainwater retention basin, the utilization of rainwater for toilet facilities, and the development of green roofs for water retention.
  • Collected and reused rainwater/greywater (m³)
  • Water reuse is listed as a core indicator in the ICMA Handbook– Harmonized Framework for Impact Reporting.
  • VGP reports on completed projects for this project category. Impacts for projects currently under construction will be reported following completion.

PAGE  VGP NV ANNUAL REPORT  SECTION Additional information

Biotope at VGP Park München, Germany

CORPORATE RESPONSIBILITY REPORT  PAGE SECTION

VGP Park Magdeburg-Sülzetal

CORPORATE RESPONSIBILITY REPORT  PAGE 

VGP REPORTING METHODOLOGY .

VGP uses a variety of tools, processes and indicators to monitor the performance of the assets owned and managed by the Group. These methods are used to structure an environmental, social and societal management approach, track results and to inform its stakeholders about performance. The Group continuously improves its reporting tools and processes in order to fine-tune the quality and accuracy of its consolidated data. This enables the Group to man- age its data collection processes more efficiently, track and analyse performance at all levels (site, region, Group) on a regular basis, assess results against targets, and implement suitable corrective measures. The Group sustainability reporting framework, which tracks performance against each of its ESG Strategy commitments is reviewed and updated every year to fine-tune its accuracy. For a detailed explanation of the indicators used, the reporting scope, gross let- table area reference data as well as GPS coordinates, please refer to the VGP website: https://www.vgpparks.eu/en/investors/environmental-disclosures/.

PAGE  VGP NV ANNUAL REPORT  ADDITIONAL INFORMATION .

Independent third-party’s ESGassurance report

VGP NV Independent assurance report on selected environmental per- formance indicators published in the Annual Report of VGP NV for the year ended  December 

To the board of directors

We have been engaged to conduct a limited assurance engagement on selected environmental performance indica- tors (“Selected Information”) published in the Annual report of VGP NV (“the Company”) for the year ending  December . In preparing the Selected Information, VGP NV applied the criteria of the GHG Protocol. The Selected Information needs to be read and understood together with the Applica- ble Criteria.# INDEPENDENT THIRD-PARTY’S ESG ASSURANCE REPORT

The Selected Information in scope of our engagement is included in chapter “... Results: Group carbon footprint” of the Annual Report per  December  and is included in below table:

Selected Information	Applicable Criteria	Scope
1– in tnCO2e	GHG Protocol
Scope 2– in tnCO2e (market & location based)	GHG Protocol
Scope 3 emissions related to the portfolio in use, category 13, downstream leased assets– in tnCO2e	GHG Protocol

Based on our work as described in this report, nothing has come to our attention that causes us to believe that the above-mentioned Selected Information included in chapter “... Results: Group carbon footprint” of the Annual Report of VGP NV per  December , has not been prepared, in all mate- rial respects, in accordance with the Appliable Criteria.

Responsibility of the board of directors

The board of directors of VGP NV is responsible for the prepa- ration of the Selected Information and the references made to it presented in the Annual Report as well as for the decla- ration that its reporting meets the requirements of Applicable Criteria. The board of directors is also responsible for:

• Selecting and establishing the Applicable Criteria;
• Preparing, measuring, presenting and reporting the Selected Information in accordance with the Applicable Criteria;
• Designing, implementing, and maintaining internal pro- cesses and controls over information relevant to the prepa- ration of the Selected Information to ensure that they are free from material misstatement, including whether due to fraud or error;
• Providing sufficient access and making available all nec- essary records, correspondence, information and explana- tions to allow the successful completion of the Services;
• Confirming to us through written representations that you have provided us with all information relevant to our Ser- vices of which you are aware, and that the measurement or evaluation of the underlying subject matter against the Applicable Criteria, including that all relevant matters, are reflected in the Selected Information.

Our responsibilities

Our responsibility is to express a conclusion on the Selected Information based on our procedures. We conducted our engagement in accordance with International Standard on Assurance Engagements ISAE  (Revised) Assurance Engagements Other than Audits or Reviews of Historical Financial Information, issued by the International Auditing and Assurance Standards Board (IAASB), in order to state whether anything had come to our attention that causes us to believe that the Selected Information have not been prepared, in all material respects, in accordance with the Applicable Criteria.

Applying these standards, our procedures are aimed at obtaining limited assurance on the fact that the Selected Information do not contain material misstatements. The pro- cedures performed in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a rea- sonable assurance engagement and consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed.

Our work was performed on the data gathered and retained in the reporting scope by VGP NV as mentioned above. Our conclusion covers therefore only the abovementioned Selected Information included in chapter “... Results:

CORPORATE RESPONSIBILITY REPORT  PAGE 

Group carbon footprint” of the Annual Report per  Decem- ber  and not all information included in the Annual Report. The limited assurance on the Selected Information was only performed on the Selected Information covering the year end- ing  December .

We are required to plan and perform our work to address the areas where we have identified that a material misstate- ment of the description of activities undertaken in respect of the Selected Information is likely to arise. The procedures we performed were based on our professional judgment. In carry- ing out our limited assurance engagement on the description of activities undertaken in respect of the Selected Information, we performed the following key procedures:

• Perform analytical review procedures and consider the risks of material misstatement of the Selected Information.
• Through inquiries of management, obtain an understand- ing of the Company, its environment, processes and infor- mation systems relevant to the preparation of the Selected Information sufficient to identify and assess risks of mate- rial misstatement in the Selected Information, and pro- vide a basis for designing and performing procedures to respond to assessed risks and to obtain limited assurance to support a conclusion.
• Perform procedures over the Selected Information, includ- ing recalculation of relevant formulae used in manual cal- culations and assessment whether the data has been appropriately consolidated.
• Perform procedures over underlying data on a statistical sample basis to assess whether the data has been col- lected and reported in accordance with the Applicable Cri- teria, including verifying to source documentation.
• Perform procedures over the Selected Information includ- ing assessing management’s assumptions and estimates.
• Accumulate misstatements and control deficiencies iden- tified, assessing whether material.
• Read the narrative accompanying the Selected Informa- tion with regard to the Applicable Criteria, and for consist- ency with our findings.

We apply International Standard on Quality Management  and, accordingly, maintain a comprehensive system of qual- ity control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. In conducting our engagement, we have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the Interna- tional Ethics Standards Board for Accountants (IESBA), which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.

Inherent limitations of theSelected Information

We obtained limited assurance over the preparation of the Selected Information in accordance with the Applicable Cri- teria. Inherent limitations exist in all assurance engagements. Any internal control structure, no matter how effective, can- not eliminate the possibility that fraud, errors or irregularities may occur and remain undetected and because we use selec- tive testing in our engagement, we cannot guarantee that errors or irregularities, if present, will be detected. The self-defined Applicable Criteria, the nature of the Selected Information, and absence of consistent external standards allow for different, but acceptable, measurement methodologies to be adopted which may result in variances between entities. The adopted measurement methodolo- gies may also impact comparability of the Selected Informa- tion reported by different organisations and from year to year within an organisation as methodologies develop.

Use of our report

This report is made solely to the board of directors of VGP NV in accordance with ISAE  (Revised) and our agreed terms of engagement. Our work has been undertaken so that we might state to the board of directors those matters we have agreed to state to them in this report and for no other purpose. Without assuming or accepting any responsibility or liability in respect of this report to any party other than the Company and its board of directors, we acknowledge that the board of directors may choose to make this report publicly available for others wishing to have access to it, which does not and will not affect or extend for any purpose or on any basis our responsibilities. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than VGP NV and its board of directors as a body, for our work, for this report, or for the conclusions we have formed.

Deloitte Bedrijfsrevisoren/Réviseurs d’Entreprises BV/SRL
Represented by Sofian Milad

VGP Office Prague, Czech Republic

Honey collected at the VGP office in the Czech Republic.

CORPORATE RESPONSIBILITY REPORT  PAGE 

CORPORATE DIRECTORY

Corporate Directory

VGP NV

Registered seat
Generaal Lemanstraat  bus  B- ANTWERP
Belgium
tel + ()    
www.vgpparks.eu
VAT: BE
Enterprise number: ..

Other VGP offices

Vienna, Austria
Prague, Czech Republic
Jenišovice u Jablonce nad Nisou, Czech Republic
Fredericia, Denmark
Lyon, France
Paris, France
Düsseldorf, Germany
Budapest, Hungary
Segrate (Milan), Italy
Riga, Latvia
Luxembourg, Luxembourg
’s-Hertogenbosch, The Netherlands
Porto, Portugal
Lisbon, Portugal
Bucharest, Romania
Belgrade, Serbia
Bratislava, Slovakia
Barcelona, Spain
Madrid, Spain
Zaragoza, Spain
Sevilla, Spain
Bilbao, Spain

Directors

VM INVEST NV, represented by Bart Van Malderen
Chairman; Non-Executive and Reference Shareholder

Jan Van Geet
s. r.# VGP NV ANNUAL REPORT 2023

o., represented by Jan Van Geet CEO; Executive and Reference Shareholder GAEVAN BV, represented by Ann Gaeremynck Non-Executive (Independent) Director Katherina Reiche Non-Executive (Independent) Director Vera Gade-Butzlaff Non-Executive (Independent) Director Financial Auditor Deloitte Bedrijfsrevisoren/ Réviseurs d’Entreprises BV/SRL Share code VGP is listed on Euronext Brussels ISIN: BE VGP NV is a member of the FTSE EPRA Nareit Global Developed Index and the Euronext ESG index Bloomberg: VGP BB Refinitiv (ThomsonReuters): VGP:BRU

PORTFOLIO 2023

VGP PARK OVERVIEW

Germany

1 VGP Park Hamburg
2 VGP Park Soltau
3 VGP Park Leipzig
4 VGP Park Leipzig Flughafen
5 VGP Park Berlin
6 VGP Park Berlin Oberkrämer
7 VGP Park Ginsheim
8 VGP Park Schwalbach
9 VGP Park München
10 VGP Park Bingen
11 VGP Park Rodgau
12 VGP Park Höchstadt
13 VGP Park Borna
14 VGP Park Bobenheim-Roxheim
15 VGP Park Frankenthal
16 VGP Park Wustermark
17 VGP Park Göttingen
18 VGP Park Göttingen 2
19 VGP Park Wetzlar
20 VGP Park Halle
21 VGP Park Halle 2
22 VGP Park Dresden-Radeburg
23 VGP Park Bischofsheim
24 VGP Park Gießen-Buseck
25 VGP Park Gießen-Lützellinden
26 VGP Park Gießen Am alten Flughafen
27 VGP Park Chemnitz
28 VGP Park Magdeburg
29 VGP Park Laatzen
30 VGP Park Einbeck
31 VGP Park Erfurt
32 VGP Park Erfurt 2
33 VGP Park Erfurt 3
34 VGP Park Rostock
35 VGP Park Wiesloch-Walldorf
36 VGP Park Nürnberg
37 VGP Park Hochheim
38 VGP Park Siegen
39 VGP Park Koblenz
40 VGP Park Rüsselsheim

Czech Republic

41 VGP Park Tuchoměřice
42 VGP Park Ústí nad Labem
43 VGP Park Český Újezd
44 VGP Park Liberec
45 VGP Park Olomouc
46 VGP Park Jeneč
47 VGP Park Chomutov
48 VGP Park Brno
49 VGP Park Hrádek nad Nisou
50 VGP Park Hrádek nad Nisou 2
51 VGP Park Plzeň
52 VGP Park Prostějov
53 VGP Park Vyškov
54 VGP Park České Budějovice
55 VGP Park Kladno
56 VGP Park Ústí nad Labem City

Spain

57 VGP Park San Fernado deHenares
58 VGP Park Lliçà d’Amunt
59 VGP Park Fuenlabrada
60 VGP Park Fuenlabrada 2
61 VGP Park Valencia Cheste
62 VGP Park Zaragoza
63 VGP Park Dos Hermanas
64 VGP Park Sevilla Ciudad de la Imagen
65 VGP Park Granollers
66 VGP Park Martorell
67 VGP Park La Naval
68 VGP Park Burgos
69 VGP Park Alicante
70 VGP Park Córdoba
71 VGP Park Belartza

Latvia

72 VGP Park Kekava
73 VGP Park Riga
74 VGP Park Tiraines

Romania

75 VGP Park Timișoara
76 VGP Park Sibiu
77 VGP Park Brașov
78 VGP Park Arad
79 VGP Park Bucharest

Hungary

80 VGP Park Győr
81 VGP Park Győr Béta
82 VGP Park Alsónémedi
83 VGP Park Hatvan
84 VGP Park Kecskemét
85 VGP Park Budapest Aerozone

Slovakia

86 VGP Park Malacky
87 VGP Park Bratislava
88 VGP Park Zvolen

Austria

89 VGP Park Graz
90 VGP Park Laxenburg
91 VGP Park Ehrenfeld

The Netherlands

92 VGP Park Nijmegen
93 VGP Park Roosendaal
94 VGP Park Moerdijk

Italy

95 VGP Park Calcio
96 VGP Park Valsamoggia
97 VGP Park Valsamoggia 2
98 VGP Park Sordio
99 VGP Park Padova
100 VGP Park Paderno Dugnano
101 VGP Park Legnano
102 VGP Park Parma Lumiere
103 VGP Park Parma Paradigna

Portugal

104 VGP Park Santa Maria da Feira
105 VGP Park Sintra
106 VGP Park Loures
107 VGP Park Montijo

Serbia

108 VGP Park Belgrade Dobanovice

Croatia

109 VGP Park Lučko Zagreb

France

110 VGP Park Rouen
111 VGP Park Vélizy
112 VGP Park Mulhouse

VGP PARK OVERVIEW

VGP Parks all-over Europe
Western and Southern Europe Germany, Austria, The Netherlands, France, Italy, Portugal, Spain
Central and Eastern Europe Czech Republic, Slovakia, Romania, Hungary, Serbia, Croatia, Latvia

Region	Country	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)	Completed	Under construction	Potential	Total
East	Croatia	Own	95,306	—	—	36,867	36,867	0.00
East	Czechia	Committed	80,042	—	—	32,013	32,013	0.00
East	Czechia	JV1	1,475,778	625,515	8,665	8,313	642,493	35.02
East	Czechia	Own	876,544	142,493	39,660	128,106	310,259	8.41
East	Hungary	JV1	207,148	83,174	—	4,900	88,074	5.22
East	Hungary	Own	1,208,566	114,270	105,873	252,123	472,266	15.06
East	Latvia	Own	330,622	133,542	—	14,060	147,602	7.59
East	Romania	JV2	292,724	146,085	—	0	146,085	6.91
East	Romania	Own	1,500,181	169,133	86,046	492,879	748,058	14.13
East	Serbia	Own	1,160,544	76,938	385,996	462,934	4.57
East	Slovakia	JV1	220,492	88,615	—	16,006	104,621	4.99
East	Slovakia	Own	1,283,143	138,244	48,104	390,712	577,060	9.66
West	Austria	JV2	38,239	16,537	—	0	16,537	1.41
West	Austria	Own	400,961	22,560	82,594	47,398	152,552	7.75
West	Denmark	Committed	175,256	—	—	81,449	81,449	0.00
West	France	Own	728,428	—	39,330	287,535	326,865	2.17
West	Germany	Committed	151,790	—	—	77,832	77,832	1.07
West	Germany	JV5	1,584,538	717,812	141,478	0	859,290	52.93
West	Germany	VGP Park Siegen JV	34,035	—	—	20,976	20,976	0.00
West	Germany	JV1	2,411,625	1,173,600	—	14,829	1,188,429	68.80
West	Germany	JV3	644,158	276,003	—	37,878	313,881	26.23
West	Germany	Own	3,113,627	733,867	87,366	694,425	1,515,658	30.35
West	Italy	Committed	171,925	—	—	79,129	79,129	0.00
West	Italy	JV2	197,136	86,380	—	0	86,380	5.64
West	Italy	Own	367,136	—	18,782	127,654	146,437	1.68
West	Netherlands	JV2	448,997	258,683	—	20,088	278,771	14.86
West	Netherlands	LPM JV	719,762	—	—	487,867	487,867	0.00
West	Netherlands	Own	238,041	—	—	136,222	136,222	0.00
West	Portugal	JV2	73,578	29,813	—	0	29,813	1.34
West	Portugal	Own	184,444	19,749	31,789	25,802	77,340	2.91
West	Spain	JV2	830,517	389,395	—	70,402	459,797	22.05
West	Spain	VGP Park Belartza JV	145,215	—	—	63,640	63,640	0.00
West	Spain	Own	569,753	—	7,218	289,673	296,891	0.02
			21,960,252	5,365,470	773,843	4,324,774	10,464,086	350.76

* Gross Lettable Area is including development potential

Gross Lettable Area by Region (in m²) — including JV at 100%
Central and Eastern Europe – 75%
Western and Southern Europe – 25%

Gross Lettable Area by Country (in m²) — including JV at 100%
Austria – 169,089 m² – 2%
Croatia – 36,867 m² – 0%
Czechia – 984,765 m² – 9%
Denmark – 81,449 m² – 1%
France – 326,865 m² – 3%
Germany – 3,976,065 m² – 38%
Hungary – 560,340 m² – 5%
Italy – 311,946 m² – 3%
Latvia – 147,602 m² – 1%
The Netherlands – 902,860 m² – 9%
Portugal – 107,153 m² – 1%
Romania – 894,143 m² – 9%
Serbia – 462,934 m² – 4%
Slovakia – 681,681 m² – 7%
Spain – 820,327 m² – 8%

Gross Lettable Area by Ownership (in m²) — JV at 100%
Own – 5,027,000 m² – 48%
Joint Ventures – 5,437,000 m² – 52%

GERMANY

GERMANY

1 VGP Park Hamburg
2 VGP Park Soltau
3 VGP Park Leipzig
4 VGP Park Leipzig Flughafen
5 VGP Park Berlin
6 VGP Park Berlin Oberkrämer
7 VGP Park Ginsheim
8 VGP Park Schwalbach
9 VGP Park München
10 VGP Park Bingen
11 VGP Park Rodgau
12 VGP Park Höchstadt
13 VGP Park Borna
14 VGP Park Bobenheim-Roxheim
15 VGP Park Frankenthal
16 VGP Park Wustermark
17 VGP Park Göttingen
18 VGP Park Göttingen 2
19 VGP Park Wetzlar
20 VGP Park Halle
21 VGP Park Halle 2
22 VGP Park Dresden-Radeburg
23 VGP Park Bischofsheim
24 VGP Park Gießen-Buseck
25 VGP Park Gießen-Lützellinden
26 VGP Park Gießen Am alten Flughafen
27 VGP Park Chemnitz
28 VGP Park Magdeburg
29 VGP Park Laatzen
30 VGP Park Einbeck
31 VGP Park Erfurt
32 VGP Park Erfurt 2
33 VGP Park Erfurt 3
34 VGP Park Rostock
35 VGP Park Wiesloch-Walldorf
36 VGP Park Nürnberg
37 VGP Park Hochheim
38 VGP Park Siegen
39 VGP Park Koblenz
40 VGP Park Rüsselsheim

GERMANY

VGP Park Berlin

BUILDING E
tenant Picnic GmbH
lettable area 10,585 m² + extension 9,950 m²
built 2020

VGP Park Berlin

BUILDING D
tenant Lidl Digital FC GmbH & Co. KG; Solardach LLG GmbH
lettable area 53,675 m²
built 2017

VGP Park Berlin

BUILDING C
tenant SSW Stolze Stahl Waren GmbH; DefShop GmbH; Pets Deli Tonius GmbH; VGP PM Services GmbH; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH (DE)
lettable area 26,062 m²
built 2018

VGP Park Berlin

BUILDING B
tenant Lillydoo Services GmbH; VGP Renewable Energy S.à r.l.
lettable area 9,717 m²
built 2018

VGP Park Berlin

BUILDING A
tenant Emons Logistik GmbH; Barsan Global Logistik GmbH; Emsland-Stärke GmbH; Isringhausen GmbH & Co. KG; VGP Renewable Energy S.à r.l.
lettable area 23,853 m²
built 2015

VGP Park Bingen

BUILDING A
tenant Custom Chrome Europe GmbH
lettable area 6,400 m²
built 2014

VGP Park Berlin

BUILDING M
tenant Malindo GmbH
lettable area 17,337 m²
built 2022

VGP Park Berlin

BUILDING H
tenant Zalando Lounge Logistics SE & Co. KG
lettable area 23,094 m²
built 2019

VGP Park Berlin

BUILDING G
tenant Logit Services GmbH; Pietsch GmbH; Alfred Kärcher Vertriebs-GmbH; Messenger Fullfillment GmbH
lettable area 11,725 m²
built 2020

VGP Park Berlin

BUILDING F
tenant Picnic GmbH
lettable area 24,872 m²
built 2020

VGP Park Hamburg

BUILDING A
tenant GEODIS CL Germany GmbH; Nippon Express (Deutschland) GmbH; EGC Energie- und Gebäudetechnik Control GmbH & Co. KG; MH Handel GmbH
lettable area 30,167 m²
built 2013

VGP Park Ginsheim

BUILDING A
tenant Greenyard Fresh Germany GmbH; 4PX Express GmbH; VGP Renewable Energy S.à.r.l.; Crane Worldwide Germany GmbH; Stahlgruber GmbH
lettable area 35,799 m²
built 2017

VGP Park Frankenthal

BUILDING A
tenant Amazon Logistik Frankenthal GmbH; PV Frankenthal GmbH & Co KG
lettable area 146,898 m²
built 2018

VGP Park Borna

BUILDING A
tenant Lekkerland SE; VGP Renewable Energy S.à r.l.# PORTFOLIO 2023

GERMANY

VGP Park Bobenheim-Roxheim

BUILDING A
tenant Lekkerland SE; Energie Südwest – Grüne Energie GmbH
lettable area 13,618 m²
built 2015

VGP Park Hamburg

BUILDING A
tenant Landgard eG; Kohivo Green-Investment GmbH & Co. KG
lettable area 23,271 m²
built 2016

BUILDING A
tenant LZ Logistik GmbH; Energie Südwest-Grüne Energie GmbH
lettable area 13,167 m²
built 2018

BUILDING A
tenant Zebco Europe GmbH; Hausmann Logistik GmbH; LZ Logistik GmbH
lettable area 14,471 m²
built 2016

BUILDING A
tenant MH Handel GmbH; VGP Renewable Energy S.à r.l.
lettable area 9,452 m²
built 2015

BUILDING A
tenant Hausmann Logistik GmbH; Drive Medical GmbH & Co. KG; CHEP Deutschland GmbH; VGP Renewable Energy S.à r.l.
lettable area 20,170 m²
built 2015

BUILDING A
lettable area 24,750 m²
built 2014–2016

BUILDING B
tenant Rhenus Warehousing Solutions SE & Co.KG; VGP Renewable Energy S.à r.l.
lettable area 57,473 m²
built 2015–2017

BUILDING B
tenant Geis Industrie-Service GmbH; Karl Heinz Dietrich GmbH & Co KG; Lagerei und Spedition Dirk Vollmer GmbH; VGP Renewable Energy S.à r.l.
lettable area 40,587 m²
built 2017

BUILDING B
tenant Lagerei und Spedition Dirk Vollmer GmbH; VGP PM Services GmbH; Heik Spedition GmbH
lettable area 9,456 m²
built 2017

BUILDING C
tenant Rieck Projekt Kontrakt Logistik Hamburg GmbH & Co. KG; VGP Renewable Energy S.à r.l.
lettable area 23,680 m²
built 2017

BUILDING D
tenant Lagerei und Spedition Dirk Vollmer GmbH
lettable area 2,567 m²
built 2015

VGP Park Höchstadt

BUILDING A
tenant C&A Mode GmbH & Co. KG; VGP Renewable Energy S.a r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 15,002 m²
built 2015

VGP Park Leipzig

BUILDING A
tenant Deine Tür GmbH; Kohivo Green-Investment GmbH & Co. KG
lettable area 7,231 m²
built 2019

BUILDING A
tenant Flaschenpost Leipzig GmbH; Energie Südwest – Grüne Energie GmbH
lettable area 9,630 m²
built 2019

BUILDING B
tenant USM operations GmbH; Solardach LLG GmbH
lettable area 24,630 m²
built 2017

BUILDING C
tenant fms field marketing + sales services GmbH
lettable area 2,519 m²
built 2022

VGP Park Rodgau

BUILDING D
tenant EBARA Pumps Europe S.p.A.; Asendia Germany GmbH
lettable area 7,062 m²
built 2016

BUILDING C
tenant toom Baumarkt GmbH; VGP Renewable Energy S.à r.l.
lettable area 19,783 m²
built 2015

BUILDING B
tenant Rhenus Warehousing Solutions SE & Co.KG; VGP Renewable Energy S.à r.l.
lettable area 43,376 m²
built 2016

BUILDING A
tenant A & O GmbH; Rhenus Warehousing Solutions SE & Co. KG; PTG Lohnabfüllung GmbH; toom Baumarkt GmbH
lettable area 24,890 m²
built 2016

BUILDING C
tenant Deine Tür GmbH
lettable area 2,379 m²
built 2022

VGP Park Wetzlar

BUILDING B
tenant POCO Einrichtungsmärkte GmbH; Global Cargo ServiceGmbH; Strieder Transport Logistik GmbH; VGP Renewable Energy S.à r.l.; Ancla Logistik GmbH
lettable area 19,265 m²
built 2018

BUILDING A
tenant Ancla Logistik GmbH
lettable area 18,994 m²
built 2018–2019

VGP Park Soltau

BUILDING A
tenant AUDI AG; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 55,813 m²
built 2016

VGP Park Schwalbach

BUILDING A
tenant Stronghold Germany GmbH; VGP Renewable Energy S.à r.l.
lettable area 8,387 m²
built 2017

VGP Park Rodgau

BUILDING E
tenant PTG Lohnabfüllung GmbH
lettable area 8,734 m²
built 2015

VGP Park Wustermark

BUILDING A
tenant Colossus Logistics GmbH & Co. KG; L & B Leit- und Sicherungstechnische Dienstleistungs-GmbH; SEREDA GmbH; VGP PM Services GmbH; VGP Renewable Energy S.à r.l.
lettable area 10,997m²
built 2020

VGP Park Göttingen

BUILDING E
tenant Van Waveren Saaten GmbH
lettable area 6,046 m²
built 2019

BUILDING C
tenant MediaMarktSaturn Beschaffung und Logistik GmbH; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 80,157 m²
built 2021

BUILDING B
tenant Amazon EU S.à r.l.; Niederlassung Deutschland
lettable area 38,381 m²
built 2019

BUILDING A
tenant Friedrich ZUFALL GmbH & Co. KG; Amazon EU S.à r.l.; Niederlassung Deutschland; VGP Renewable Energy S.à.r.l.
lettable area 43,001 m²
built 2018

VGP Park Dresden

BUILDING A
tenant Schenker Deutschland AG; Kohivo Green-Investment GmbH & Co. KG
lettable area 20,285 m²
built 2018

VGP Park Wustermark

BUILDING C
tenant TA Technix GmbH
lettable area 6,382 m²
built 2018

BUILDING C
tenant Wepoba Wellpappenfabrik GmbH & Co. KG
lettable area 12,800 m²
built 2018

BUILDING B
tenant Schulze Logistik Berlin GmbH; Gläser und Flaschen GmbH; Box at Work GmbH; Teppich Tetik GmbH
lettable area 29,624 m²
built 2019

BUILDING A
tenant Wardow GmbH
lettable area 11,916 m²
built 2019

VGP Park Bischofsheim

BUILDING A
tenant Bettmer GmbH; Wendel Energie UG
lettable area 6,659 m²
built 2019

VGP Park Halle

BUILDING A
tenant L’ISOLANTE K-FLEX GmbH; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH, TTM Halle/Leipzig GmbH
lettable area 21,263 m²
built 2020

BUILDING B
tenant Ceha Deutschland GmbH; Schenker Deutschland AG; VGPRenewable Energy S.à r.l.
lettable area 26,848 m²
built 2020–2021

BUILDING C
tenant Trek Bicycle GmbH; VGP PM Services GmbH; Seifert Logistik Dienstleistung GmbH; VGP Renewable Energy S.à r.l.
lettable area 37,933 m²
built 2022

BUILDING A
tenant Nordlicht Consulting GmbH
lettable area 14,862 m²
built 2023

VGP Park Einbeck

BUILDING A
tenant Burgsmüller GmbH
lettable area 8,883 m²
built 2020

VGP Park Chemnitz

BUILDING A
tenant ThyssenKrupp Automation Engineering GmbH; VGP Renewable Energy S.à r.l.
lettable area 12,591 m²
built 2019

VGP Park Gießen-Buseck

BUILDING A
tenant PROLIT Verlagsauslieferung GmbH; JingDong Development Deutschland GmbH; VGP Renewable Energy S.à r.l.
lettable area 17,357 m²
built 2020

VGP Park Gießen-Lützellinden

BUILDING A
tenant Pharmaserv GmbH; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 14,156 m²
built 2020

VGP Park Magdeburg

BUILDING A
tenant REWE Markt GmbH, VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 31,869 m²
built 2020

VGP Park Magdeburg

BUILDING B
tenant Imperial Logistics & Services GmbH, Hörmann Logistic Solutions GmbH; Wheels Logistics GmbH & Co. KG; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 42,368 m²
built 2021

BUILDING C
tenant Contemporary Amperex Technology Thuringia GmbH; BWBekleidungsmanagement GmbH; VGP PM Services GmbH
lettable area 112,431 m²
built 2022, 2023

BUILDING F
tenant APM Autoteile GmbH; Contemporary Amperex Technology Thuringia GmbH; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 51,995 m²
built 2022

VGP Park München

BUILDING A
tenant Bayerische Motoren Werke Aktiengesellschaft; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
lettable area 56,874 m²
built 2020, 2022

BUILDING B
tenant KraussMaffei Technologies GmbH; VGP Renewable Energy S.à r.l.
lettable area 81,549 m²
built 2022

VGP Park München

BUILDING C
tenant KraussMaffei Technologies GmbH; VGP Renewable Energy S.à r.l.
lettable area 48,471 m²
built 2022

BUILDING E
tenant KraussMaffei Technologies GmbH; VGP Renewable Energy S.à r.l.
lettable area 39,352 m²
built 2022

BUILDING F
tenant KraussMaffei Technologies GmbH; VGP Renewable Energy S.à r.l.
lettable area 7,487 m²
built 2022

BUILDING PH NORD
tenant Bayerische Motoren Werke Aktiengesellschaft; Krauss Maffei Technologies GmbH
lettable area 22,850 m²
built 2020

BUILDING PH SUD
tenant KraussMaffei Technologies GmbH; VGP Renewable Energy S.à r.l.
lettable area 19,419 m²
built 2022

VGP Park Laatzen

BUILDING A
tenant KraussMaffei Extrusion GmbH; VGP Renewable Energy S.à r.l.# PORTFOLIO 2023

GERMANY

VGP Park Laatzen

• BUILDING B
  • tenant: KraussMaffei Extrusion GmbH
  • lettable area: 55,398 m²
  • built: 2022
• BUILDING C
  • tenant: Connox GmbH, VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
  • lettable area: 11,803 m²
  • built: 2022
• BUILDING D
  • tenant: EDEKA Einkaufskontor GmbH
  • lettable area: 51,262 m²
  • built: 2021
• BUILDING PH OST
  • tenant: Krauss Maffei Extrusion GmbH; EDEKA Einkaufskontor GmbH
  • lettable area: 8,519 m²
  • built: 2021

VGP Park Erfurt

• BUILDING A
  • tenant: Emons Logistik GmbH; JOST-Werke Logistics GmbH; KOMSA AG; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
  • lettable area: 26,214 m²
  • built: 2021
• BUILDING B
  • tenant: Kolibri Immobilien GmbH
  • lettable area: 41,815 m²
  • built: 2023

VGP Park Erfurt 3

• BUILDING A
  • tenant: Sonova Logistics Center Germany GmbH; LGI TechLog GmbH; Dachser SE Logistikzentrum Erfurt; VGP Renewable Energy S.à r.l.; VGP Renewable Energy Deutschland GmbH
  • lettable area: 29,183 m²
  • built: 2023

VGP Park Berlin Oberkrämer

• BUILDING A
  • tenant: GLX Global Logistic Services GmbH; Neolymp GmbH; VGPRenewable Energy S.à r.l.; VGPRenewable Energy Deutschland GmbH
  • lettable area: 13,717 m²
  • built: 2022
• BUILDING B
  • tenant: BDSK Handels GmbH & Co. KG; VGP PM Services GmbH; VGPRenewable Energy S.à r.l.
  • lettable area: 11,502 m²
  • built: 2022
• BUILDING C
  • tenant: Amazon Deutschland E14 Transport GmbH
  • lettable area: 9,086 m²
  • built: 2022
• BUILDING D
  • tenant: Rieck Logistik Berlin Nord GmbH & Co. KG i.G.; Rieck Fulfillment Solutions Berlin Nord GmbH & Co. KG; VGP Renewable Energy S.à r.l.
  • lettable area: 24,223 m²
  • built: 2022, 2023
• BUILDING E
  • tenant: BTG Internationale Spedition GmbH; Toussaint Berlin GmbH
  • lettable area: 10,511 m²
  • built: 2023

VGP Park Leipzig Flughafen

• BUILDING A
  • tenant: Meesenburg Großhandel KG, VGP Renewable Energy S.à r.l.; BDSK Handels GmbH & Co. KG
  • lettable area: 16,298 m²
  • built: 2022

VGP Park Rostock

• BUILDING A
  • tenant: Schenker Deutschland AG
  • lettable area: 20,447 m²
  • built: 2022

VGP Park Nürnberg

• BUILDING H
  • tenant: Siemens Aktiengesellschaft Real Estate GS SRE DE NBY 2
  • lettable area: 65,221 m²
  • built: acquired 2022

VGP Park Hochheim

• BUILDING A
  • tenant: Vicampo.de GmbH; VGP Renewable Energy Deutschland GmbH; VGP Renewable Energy S.à r.l.
  • lettable area: 12,025 m²
  • built: 2023

VGP Park Gießen Am alten Flughafen

• BUILDING A
  • tenant: Zalando Logistics Gießen SE & Co. KG; VGP Renewable EnergyS.à r.l.; VGP Renewable Energy Deutschland GmbH
  • lettable area: 124,922 m²
  • built: 2023
• BUILDING B
  • tenant: UPS SCS GmbH & Co. KG; Rhenus Warehousing Solutions SE&Co.KG; VGP Renewable Energy S.à r.l.
  • lettable area: 59,150 m²
  • built: 2023

VGP Park Rüsselsheim AREAL K

• tenant: Opel Automobile GmbH
• lettable area: 181,787 m²
• built: acquired 2023

VGP Park Rüsselsheim AREAL M

• tenant: Opel Automobile GmbH
• lettable area: 185,516 m²
• built: acquired 2023

VGP Park Rüsselsheim AREAL MM

• tenant: Opel Automobile GmbH
• lettable area: 24,446 m²
• built: acquired 2023

VGP Park Rüsselsheim AREAL P

• tenant: Opel Automobile GmbH
• lettable area: 30,008 m²
• built: acquired 2023

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Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)	Completed	Under construction	Potential	Total
VGP Park Erfurt	50,265	26,214	—	—	—	26,214	1.27
VGP Park Erfurt 2	76,443	41,815	—	—	—	41,815	2.15
VGP Park Erfurt 3	46,840	29,183	—	—	—	29,183	1.71
VGP Park Halle	165,888	86,044	—	—	—	86,044	4.10
VGP Park Halle 2	50,826	14,862	—	11,533	—	26,395	0.99
VGP Park Leipzig Flughafen	47,361	16,298	—	—	—	16,298	0.91
VGP Park Hamburg 4	32,362	—	9,700	—	—	9,700	0.00
VGP Park Hochheim	25,308	12,025	—	—	—	12,025	0.76
VGP Park Koblenz	63,602	32,377	—	—	32,377	32,377	2.03
VGP Park Leipzig Flughafen 2	449,253	—	209,461	—	—	209,461	0.00
VGP Park Nürnberg	383,448	65,221	—	—	89,666	154,887	5.33
VGP Park Rostock	105,217	20,447	—	—	24,419	44,866	0.50
VGP Park Rüsselsheim – Areal K	892,595	181,787	—	—	96,480	278,267	3.22
VGP Park Rüsselsheim – Areal M	448,485	209,962	—	—	177,230	387,192	4.28
VGP Park Rüsselsheim – Areal P	64,670	30,008	—	—	12,000	42,008	0.65
VGP Park Wiesloch- Walldorf	211,064	—	54,989	—	63,936	118,925	2.44
Total VGP	3,113,627	733,867	87,366	—	694,425	1,515,658	30.35

---

Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)	Completed	Under construction	Potential	Total
VGP Park Berlin Oberkrämer JV5	204,512	69,039	—	—	—	69,039	5.19
VGP Park Gießen Am alten Flughafen JV5	316,866	184,072	67,433	—	—	251,505	16.28
VGP Park Göttingen 2 JV5	173,375	86,203	—	—	—	86,203	5.33
VGP Park Laatzen JV5	284,927	139,835	—	—	—	139,835	10.44
VGP Park Magdeburg JV5	604,858	238,663	74,045	—	—	312,708	15.67
VGP Park Siegen JV	34,035	—	—	20,976	—	20,976	0.00
VGP Park Berlin JV1	46,540	23,853	—	—	—	23,853	1.29
VGP Park Berlin 2 JV1	187,455	89,454	—	—	—	89,454	4.38
VGP Park Berlin 3 JV1	225,034	70,277	9,950	—	80,227	80,227	4.15
VGP Park Berlin 4 JV1	54,816	17,337	—	—	4,879	22,216	1.09
VGP Park Berlin Wustermark JV1	132,680	71,721	—	—	—	71,721	3.88
VGP Park Bingen JV1	15,000	6,400	—	—	—	6,400	0.49
VGP Park Bischofsheim JV1	13,457	6,659	—	—	—	6,659	0.55
VGP Park Bobenheim-Roxheim JV1	56,643	23,271	—	—	—	23,271	1.88
VGP Park Borna JV1	42,533	13,618	—	—	—	13,618	0.93
VGP Park Buseck JV1	36,549	17,357	—	—	—	17,357	1.01
VGP Park Chemnitz JV1	40,421	12,591	—	—	—	12,591	1.15
VGP Park Dresden JV1	32,383	20,285	—	—	—	20,285	0.94
VGP Park Einbeck JV1	20,300	8,883	—	—	—	8,883	0.71
VGP Park Frankenthal JV1	174,282	146,898	—	—	—	146,898	9.39
VGP Park Ginsheim JV1	59,845	35,799	—	—	—	35,799	2.61
VGP Park Göttingen JV1	138,297	81,382	—	—	—	81,382	3.47
VGP Park Hamburg JV1	271,843	114,742	—	—	—	114,742	7.49
VGP Park Hamburg 2 JV1	213,918	107,515	—	—	—	107,515	6.27
VGP Park Hamburg 3 JV1	51,351	23,680	—	—	—	23,680	1.23
VGP Park Höchstadt JV1	45,680	15,002	—, —	—	—	15,002	0.95
VGP Park Leipzig JV1	105,885	46,389	—	—	—	46,389	2.66
VGP Park Lützellinden JV1	23,379	14,156	—	—	—	14,156	1.15
VGP Park Rodgau JV1	216,543	103,874	—	—	—	103,874	6.47
VGP Park Schwalbach JV1	19,587	8,387	—	—	—	8,387	0.55
VGP Park Soltau JV1	119,868	55,813	—	—	—	55,813	1.88
VGP Park Wetzlar JV1	67,336	38,259	—	—	—	38,259	2.23
VGP Park München JV3	644,158	276,003	—	—	37,878	313,881	26.23
Total Joint Ventures	4,674,356	2,167,415	141,478	—	73,683	2,382,576	147.96
VGP Park Berlin Bernau Committed	141,160	—	—	—	70,618	70,618	0.00
VGP Park Steinbach Committed	10,630	—	—	—	7,214	7,214	1.07
Total Committed	151,790	—	—	—	77,832	77,832	1.07
Total Germany	7,939,773	2,901,282	228,844	—	845,940	3,976,066	179.38

CZECH REPUBLIC

VGP Park Brno

• BUILDING I.
  • tenant: KARTON P+P, spol. s r.o.; Igepa CZ s.r.o.
  • lettable area: 12,226 m²
  • built: 2017
• BUILDING II.
  • tenant: NOTINO, s.r.o.; SUTA s.r.o.
  • lettable area: 14,639 m²
  • built: 2013–2016
• BUILDING III.
  • tenant: HARTMANN – RICO a.s.
  • lettable area: 8,621 m²
  • built: 2013

VGP Park Český Újezd

• BUILDING I.
  • tenant: Yusen Logistics (Czech) s.r.o.; Spedice Kudrová s.r.o.
  • lettable area: 12,789 m²
  • built: 2018
• BUILDING II.
  • tenant: FIA ProTeam s.r.o.
  • lettable area: 2,753 m²
  • built: 2016

VGP Park Hrádek nad Nisou

• BUILDING H
  • tenant: Drylock Technologies s.r.o.
  • lettable area: 40,361 m²
  • built: 2012–2014
• BUILDING H
  • tenant: Drylock Technologies s.r.o.
  • lettable area: 17,848 m²
  • built: 2020
• BUILDING H
  • tenant: Drylock Technologies s.r.o.
  • lettable area: 29,609 m²
  • built: 2018
• BUILDING 
  • tenant: Drylock Technologies s.r.o.; VGP Renewable Energy s.r.o.
  • lettable area: 30,215 m²
  • built: 2022

VGP Park Liberec

• BUILDING L
  • tenant: KNORR-BREMSE Systémy pro užitková vozidla ČR, s.r.o.
  • lettable area: 11,436 m²
  • built: 2016

VGP Park Olomouc

• BUILDING B
  • tenant: John Crane a.s.
  • lettable area: 12,029 m²
  • built: 2017
• BUILDING C
  • tenant: SGB Czech Trafo s.r.o.; Edwards, s.r.o.
  • lettable area: 11,429 m²
  • built: 2018
• BUILDING D
  • tenant: MedicProgress, a.s.
  • lettable area: 2,600 m²
  • built: 2019
• BUILDING G
  • tenant: Benteler Automotive Rumburk s.r.o.; Gerflor CZ s.r.o; PROZK s.r.o.; SUTA s.r.o.
  • lettable area: 12,117 m²
  • built: 2017
• BUILDING A
  • tenant: Nagel Česko s.r.o.
  • lettable area: 7,807 m²
  • built: 2017
• BUILDING G
  • tenant: FENIX solutions s.r.o.
  • lettable area: 19,859 m²
  • built: 2015
• BUILDING H
  • tenant: Mürdter Dvořák, lisovna, spol. s r.o.; Nissens Cooling Solutions Czech, s.r.o.lettable area 14,254 m² built 2019 CZECH REPUBLIC VGP Park Olomouc BUILDING I tenant RTR – TRANSPORT A LOGISTIKA s.r.o; Pilulka Lékárny a.s.; FMČESKÁ, s.r.o.; HVM PLASMA, spol. s r.o.
    lettable area 23,283 m² built 2021 CZECH REPUBLIC VGP Park Olomouc BUILDING J tenant GBC Solino s.r.o.
    lettable area 14,331 m² built 2019 CZECH REPUBLIC VGP Park Olomouc BUILDING L tenant Nissens Cooling Solutions Czech s.r.o.
    lettable area 18,235 m² built 2020
    CZECH REPUBLIC VGP Park Olomouc BUILDING F tenant ARDON SAFETY s.r.o.; HELLA AUTOTECHNIK NOVA, s.r.o.; Vodafone Czech Republic a.s.
    lettable area 65,889 m² built 2022
    CZECH REPUBLIC VGP Park Pilsen BUILDING A tenant ASSA ABLOY ES Production s.r.o.; Mraknet s.r.o.
    lettable area 8,711 m² built 2014
    CZECH REPUBLIC VGP Park Pilsen BUILDING B tenant FAIVELEY TRANSPORT CZECH a.s.
    lettable area 21,918 m² built 2015
    CZECH REPUBLIC VGP Park Pilsen BUILDING C tenant Excell Czech s.r.o.; FAIVELEY TRANSPORT CZECH a.s.
    lettable area 9,868 m² built 2014–2015
    CZECH REPUBLIC VGP Park Pilsen BUILDING D tenant COPO CENTRAL EUROPE s.r.o.; TRANSTECHNIK CS, spol. s r.o.
    lettable area 3,640 m² built 2015–2016
    CZECH REPUBLIC VGP Park Pilsen BUILDING E tenant Verhoek Europe s.r.o.; DHL Express (Czech Republic) s.r.o.
    lettable area 5,790 m² built 2021
    CZECH REPUBLIC VGP Park Tuchoměřice BUILDING A tenant CAAMANO CZ INTERNATIONAL GLASS CORPORATION, s.r.o.; Invelt – s.r.o.; FC MORELO CZ s.r.o.; EFACEC PRAHA s.r.o.
    lettable area 6,577 m² built 2013
    CZECH REPUBLIC VGP Park Tuchoměřice BUILDING B tenant HARTMANN – RICO a.s.; ESA s.r.o.; Lidl Česká republika v.o.s.; CETIN a.s.
    lettable area 18,604 m² built 2014–2017
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P1 tenant JOTUN CZECH a.s.; Zebra Technologies CZ s.r.o.
    lettable area 5,368 m² built 2014
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P2 tenant n/a
    lettable area 6,368 m² built 2018
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P3 tenant Treves CZ s.r.o.
    lettable area 8,725 m² built 2017
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P4 tenant Treves CZ s.r.o.
    lettable area 6,134 m² built 2018
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P5 tenant JOTUN CZECH a.s.; SUTA s.r.o.
    lettable area 3,503 m² built 2020
    CZECH REPUBLIC VGP Park Ústí nad Labem BUILDING P6 tenant SSI Technologies s.r.o.
    lettable area 10,883 m² built 2015, 2020
    CZECH REPUBLIC VGP Park Jeneč BUILDING AB tenant 4PX Express CZ s.r.o.
    lettable area 52,582 m² built 2017
    CZECH REPUBLIC VGP Park Jeneč BUILDING C tenant 4PX Express CZ s.r.o.; SUTA s.r.o.
    lettable area 11,698 m² built 2018
    CZECH REPUBLIC VGP Park Jeneč BUILDING D1 tenant 4PX Express CZ s.r.o.
    lettable area 1,885 m² built 2017
    CZECH REPUBLIC VGP Park Jeneč BUILDING D2 tenant 4PX Express CZ s.r.o.
    lettable area 3,725 m² built 2019
    CZECH REPUBLIC VGP Park Chomutov BUILDING A tenant Geis Solutions CZ s.r.o., Beinbauer Automotive CZ s.r.o., SUTA s.r.o.
    lettable area 15,570 m² built 2018
    CZECH REPUBLIC VGP Park Chomutov BUILDING BC tenant Magna Automotive (CZ) s.r.o.; Geis Solutions CZ s.r.o.
    lettable area 36,095 m² built 2018
    CZECH REPUBLIC VGP Park Chomutov BUILDING D tenant Magna Automotive (CZ) s.r.o.
    lettable area 5,544 m² built 2022
    CZECH REPUBLIC VGP Park Prostějov BUILDING A tenant ITAB Shop Concept CZ, a.s.; twd CZ, s.r.o.
    lettable area 15,330 m² built 2021
    CZECH REPUBLIC VGP Park Prostějov BUILDING B tenant ALFA – RENT PENTE s.r.o.
    lettable area 25,055 m² built 2021
    CZECH REPUBLIC VGP Park Vyškov BUILDING A tenant ALFA – RENT PENTE s.r.o.
    lettable area 28,868 m² built 2021
    CZECH REPUBLIC VGP Park Kladno BUILDING A tenant CARGO CARE s.r.o.; Damco Czech Republic, s.r.o.
    lettable area 15,806 m² built 2022
    CZECH REPUBLIC VGP Park Kladno BUILDING B tenant Kvadrat Czech Republic s.r.o.
    lettable area 11,193 m² built 2022
    CZECH REPUBLIC VGP Park České Budějovice BUILDING C tenant DACHSER Czech Republic a.s.
    lettable area 9,424 m² built 2022
    CZECH REPUBLIC VGP Park České Budějovice BUILDING D tenant DACHSER Czech Republic a.s.
    lettable area 14,004 m² built 2023
    CZECH REPUBLIC VGP Park Ústí nad Labem City BUILDING A tenant Bosal Aftermarket Europe, spol. s r.o.; Exyte Technology CZ s.r.o.
    lettable area 22,813 m² built 2023

PORTFOLIO 2023

Park	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
		Completed	Under construction	Potential
VGP Park Kladno	VGP	68,705	26,999	—
VGP Park Prostějov	VGP	139,661	40,385	10,351
VGP Park Vyškov	VGP	54,353	28,868	—
VGP Park České Budějovice	VGP	438,620	23,428	—
VGP Park Ústí nad Labem City	VGP	108,000	22,813	29,309
Total VGP		809,339	142,493	39,660
VGP Park Brno	JV1	63,974	35,485	—
VGP Park Český Újezd	JV1	45,383	15,542	—
VGP Park Chomutov	JV1	106,791	57,210	—
VGP Park Hrádek nad Nisou	JV1	180,638	87,818	—
VGP Park Hrádek nad Nisou 2	JV1	105,082	30,215	—
VGP Park Jeneč	JV1	173,859	69,889	—
VGP Park Liberec	JV1	36,062	11,436	—
VGP Park Olomouc 1	JV1	28,490	12,117	—
VGP Park Olomouc 2	JV1	54,647	19,859	—
VGP Park Olomouc 3	JV1	175,313	70,103	8,665
VGP Park Olomouc 4	JV1	88,708	33,865	—
VGP Park Olomouc 5	JV1	132,567	65,889	—
VGP Park Plzeň	JV1	102,044	49,926	—
VGP Park Tuchoměřice	JV1	58,701	25,181	—
VGP Park Ústí nad Labem	JV1	123,519	40,981	—
Total Joint Ventures		1,475,778	625,515	8,665
VGP Park Malé Přítočno	Committed	80,042	—	—
VGP Park Kladno	Committed	67,205	—	—
Total Committed		147,247	—	—
Total Czech Republic		2,432,364	768,008	48,325

SPAIN

La Naval Burgos Zaragoza Barcelona Valencia Sevilla Madrid

PORTFOLIO 2023

57	VGP Park San Fernado de Henares
58	VGP Park Lliçà d’Amunt
59	VGP Park Fuenlabrada
60	VGP Park Fuenlabrada 2
61	VGP Park Valencia Cheste
62	VGP Park Zaragoza
63	VGP Park Dos Hermanas
64	VGP Park Sevilla Ciudad de la Imagen
65	VGP Park Granollers
66	VGP Park Martorell
67	VGP Park La Naval
68	VGP Park Burgos
69	VGP Park Alicante
70	VGP Park Córdoba
71	VGP Park Belartza

SPAIN

SPAIN VGP Park Lliça d’Amunt BUILDING A tenant Picking Farma S.A.U.
lettable area 13,639 m² built 2020
SPAIN VGP Park Lliça d’Amunt BUILDING C tenant Noatum logistics Spain, S.A.U.; DistriCenter, S.A.U.; Staci Logistics Spain, S.A.; Luís Simões Logística Integrada, S.A.; Gepanetrans Operador Logistico, S.L.
lettable area 32,170 m² built 2019
SPAIN VGP Park Lliça d’Amunt BUILDING D tenant Moldstock, S.L.
lettable area 7,205 m² built 2020
SPAIN VGP Park Lliça d’Amunt BUILDING E tenant Maskokotas, S.L.; Gotex, S.A.U.
lettable area 22,195 m² built 2020
SPAIN VGP Park San Fernando de Henares BUILDING A tenant ThyssenKrupp Elevadores, S.L.U.; Rhenus Logistics S.A.U.; Noatum Logistics Spain, S.A.U.
lettable area 22,962 m² built 2018

PORTFOLIO 2023

SPAIN SPAIN VGP Park San Fernando de Henares BUILDING B1 tenant Rhenus Logistics, S.A.U.; Logwin Solutions Spain, S.A.
lettable area 19,671 m² built 2019
SPAIN VGP Park San Fernando de Henares BUILDING B2 tenant Rhenus Logistics, S.A.U.
lettable area 12,267 m² built 2019
SPAIN VGP Park San Fernando de Henares BUILDING C1 tenant Huawei Technologies Espana, S.L.
lettable area 7,947 m² built 2020
SPAIN VGP Park San Fernando de Henares BUILDING C2 tenant Areatrans S.A.
lettable area 5,165 m² built 2020
SPAIN VGP Park San Fernando de Henares BUILDING D1 tenant Paack Logistics Iberia, S.L.U.
lettable area 11,453 m² built 2021

SPAIN SPAIN VGP Park San Fernando de Henares BUILDING D2 tenant Picking Farma, S.A.U.
lettable area 27,579 m² built 2023
SPAIN VGP Park San Fernando de Henares BUILDING E tenant DSV Road Spain, S.A.U.
lettable area 12,176 m² built 2019
SPAIN VGP Park Zaragoza BUILDING A tenant Cotrali Zaragoza, S.L.
lettable area 18,074 m² built 2020
SPAIN VGP Park Zaragoza BUILDING B tenant Thinktextil, S.L.
lettable area 21,373 m² built 2022
SPAIN VGP Park Zaragoza BUILDING C1 tenant Kuehne & Nagel, S.A.
lettable area 22,556 m² built 2021

PORTFOLIO 2023

SPAIN SPAIN VGP Park Zaragoza BUILDING C2 tenant Kuehne & Nagel, S.A
lettable area 13,616 m² built 2022
SPAIN VGP Park Valencia Cheste BUILDING A tenant Eurojuguetes, S.L.U.
lettable area 14,177 m² built 2022
SPAIN VGP Park Valencia Cheste BUILDING B tenant Dia Retail España, S.A.U.; Aza Logistics, S.L.U.; Furnilogik, S.L.U.
lettable area 25,409 m² built 2021
SPAIN VGP Park Fuenlabrada BUILDING A tenant Futurbaño, S.L.; Logista Pharma, S.A.U.
lettable area 41,752 m² built 2022
SPAIN VGP Park Granollers BUILDING A tenant Grupo Transaher, S.L.
lettable area 8,920 m² built 2022

SPAIN SPAIN VGP Park Sevilla Dos Hermanas BUILDING B tenant Lamaignere Cargo, S.L.; Almacenaje y Total Distribución Logística, S.L.; Gardenstore, S.L.; Vapores Suardiaz Sur-Atlántico, S.L.; H2B2 Electrolysis Technologies, S.L.# SPAIN

PORTFOLIO 2023

VGP Park	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)	Completed	Under construction	Potential	Total
VGP Park Alicante	VGP	41,834	—	—	24,528	24,528		0.00
VGP Park Burgos	VGP	128,190	—	—	78,264	78,264		0.00
VGP Park Córdoba	VGP	35,986	—	7,218	15,419	22,637		0.00
VGP Park Fuenlabrada 2	VGP	65,005	—	—	23,363	23,363		0.00
VGP Park La Naval	VGP	225,792	—	—	109,409	109,409		0.02
VGP Park Martorell	VGP	18,235	—	—	10,102	10,102		0.00
VGP Park Sevilla Ciudad de la Imagen	VGP	54,712	—	—	28,587	28,587		0.00
Total VGP		569,753	—	7,218	289,673	296,891		0.02
VGP Park Dos Hermanas	JV2	103,000	29,091	—	25,739	54,829		1.18
VGP Park Fuenlabrada	JV2	80,223	41,752	—	—	41,752		2.12
VGP Park Granollers	JV2	14,385	8,920	—	—	8,920		0.59
VGP Park Lliçà d’Amunt	JV2	149,597	75,208	—	—	75,208		4.99
VGP Park San Fernando de Henares	JV2	222,713	119,219	—	—	119,219		7.57
VGP Park Valencia Cheste	JV2	113,104	39,586	—	25,517	65,103		1.85
VGP Park Zaragoza	JV2	147,495	75,618	—	19,146	94,764		3.75
VGP Park Belartza	VGP Park Belartza JV	145,215	—	63,640	—	63,640		0.00
Total Joint Ventures		975,732	389,395	—	134,042	523,437		22.05
Total Spain		1,545,486	389,395	7,218	423,715	820,327		22.07

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OTHER EUROPEAN COUNTRIES

PORTFOLIO 2023

The Netherlands
* VGP Park Nijmegen (92)
* VGP Park Roosendaal (93)
* VGP Park Moerdijk (94)

Portugal
* VGP Park Santa Maria da Feira (104)
* VGP Park Sintra (105)
* VGP Park Loures (106)
* VGP Park Montijo (107)

France
* VGP Park Rouen (110)
* VGP Park Vélizy (111)
* VGP Park Mulhouse (112)

Latvia
* VGP Park Kekava (72)
* VGP Park Riga (73)
* VGP Park Tiraines (74)

Romania
* VGP Park Timișoara (75)
* VGP Park Sibiu (76)
* VGP Park Brașov (77)
* VGP Park Arad (78)
* VGP Park Bucharest (79)

Hungary
* VGP Park Győr (80)
* VGP Park Győr Béta (81)
* VGP Park Alsónémedi (82)
* VGP Park Hatvan (83)
* VGP Park Kecskemét (84)
* VGP Park Budapest Aerozone (85)

Slovakia
* VGP Park Malacky (86)
* VGP Park Bratislava (87)
* VGP Park Zvolen (88)

Austria
* VGP Park Graz (89)
* VGP Park Laxenburg (90)
* VGP Park Ehrenfeld (91)

Italy
* VGP Park Calcio (95)
* VGP Park Valsamoggia (96)
* VGP Park Valsamoggia 2 (97)
* VGP Park Sordio (98)
* VGP Park Padova (99)
* VGP Park Paderno Dugnano (100)
* VGP Park Legnano (101)
* VGP Park Parma Lumiere (102)
* VGP Park Parma Paradigna (103)

Serbia
* VGP Park Belgrade Dobanovice (108)

Croatia
* VGP Park Lučko Zagreb (109)

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HUNGARY

VGP Park Alsónémedi

BUILDING A
tenant: Nagel Hungária Logisztikai Kft.
lettable area: 22,905 m²
built: 2016

VGP Park Alsónémedi

BUILDING A
tenant: Magyar Lapterjesztő ZRT
lettable area: 8,774 m²
built: 2022

VGP Park Győr

BUILDING A
tenant: SKINY Logisztikai Kft.; WSZL Kft.; Gebrüder Weiss Szállítmányozási Kft.
lettable area: 20,290 m²
built: 2009

VGP Park Győr

BUILDING B
tenant: Lear Corporation Hungary Kft.; TI Automotive (Hungary) Kft.
lettable area: 24,742 m²
built: 2012, 2017

VGP Park Győr

BUILDING C
tenant: Dana Hungary Kft.
lettable area: 6,463 m²
built: 2011

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VGP Park Győr Béta

BUILDING B
tenant: Raben Trans European Hungary Kft.; Transdanubia Logisztikai Kft.
lettable area: 13,915 m²
built: 2022

VGP Park Kecskemét

BUILDING A
tenant: Andreas Schmid Kontrakt Logistik GmbH & Co. KG; BohnenkampKft.; Cargoport Kft.; Mercedes-Benz Manufacturing Hungary Kft.
lettable area: 21,937 m²
built: 2022

VGP Park Kecskemét

BUILDING B
tenant: HunTex Recycling Kft.
lettable area: 17,046 m²
built: 2020

VGP Park Kecskemét

BUILDING C
tenant: P-Development Vagyonkezelő Kft.
lettable area: 20,149 m²
built: 2023

VGP Park Hatvan

BUILDING A
tenant: LKH LEONI Kft.
lettable area: 16,664 m²
built: 2019

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VGP Park Budapest Aerozone

BUILDING B
tenant: BOXY Logisztikai Zrt.
lettable area: 11,015 m²
built: 2022

VGP Park Budapest Aerozone

BUILDING C
tenant: Agroloop Hungary Kft.
lettable area: 13,544 m²
built: 2023

SLOVAKIA

VGP Park Malacky

BUILDING A
tenant: Benteler Automotive SK s.r.o.; SPP – distribuce, a.s.
lettable area: 14,863 m²
built: 2009

VGP Park Malacky

BUILDING B
tenant: Benteler Automotive SK s.r.o.; Cipher Europe s.r.o.; PLP Facility, a.s.; ASSA ABLOY Opening Solutions Slovakia s. r. o.; Forbo Siegling s.r.o.
lettable area: 20,049 m²
built: 2016

VGP Park Malacky

BUILDING C
tenant: FROMM SLOVAKIA, a.s.; Molandertech s.r.o.
lettable area: 15,255 m²
built: 2015

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VGP Park Malacky

BUILDING D
tenant: Volkswagen Konzernlogistik GmbH & Co. OHG
lettable area: 25,692 m²
built: 2015

VGP Park Malacky

BUILDING E
tenant: IDEAL Automotive Malacky, s.r.o.
lettable area: 12,756 m²
built: 2016

VGP Park Bratislava

BUILDING A
tenant: Dirks Consumer Slovakia GmbH, org. zložka
lettable area: 43,361 m²
built: 2022

VGP Park Bratislava

BUILDING F
tenant: Continental Barum s.r.o.
lettable area: 57,328 m²
built: 2021

VGP Park Bratislava

BUILDING G
tenant: Coca-Cola HBC Česko a Slovensko, s.r.o.; Hossa family, s.r.o.; HOLLEX SLOVAKIA, s.r.o.
lettable area: 19,201 m²
built: 2023

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VGP Park Bratislava

BUILDING H
tenant: Geis SK s.r.o.
lettable area: 18,354 m²
built: 2022

LATVIA

VGP Park Kekava

BUILDING A
tenant: SIA “BMJ Latvia”; Hanzas Maiznīca AS; SIA “CONSTRUCTION TRADE”, MDL Terminal SIA; Power Solution SIA; GRIPsteel SIA; Energokomplekss SIA; JAS Worldwide Latvia SIA; VILKS SIA
lettable area: 35,841 m²
built: 2018

VGP Park Kekava

BUILDING B
tenant: MMD Serviss SIA
lettable area: 26,988 m²
built: 2019

VGP Park Riga

BUILDING B
tenant: DO IT SIA
lettable area: 41,816 m²
built: 2022

VGP Park Tiraines

BUILDING A
tenant: EUGESTA un Partneri SIA; TeleTower SIA
lettable area: 28,897 m²
built: 2023

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ROMANIA

VGP Park Timișoara

BUILDING A
tenant: QUEHENBERGER LOGISTICS ROU SRL
lettable area: 17,613 m²
built: 2016

VGP Park Timișoara

BUILDING A
tenant: FAN COURIER EXPRESS SRL; ITC LOGISTIC ROMANIA S.R.L.; KLG Europe Logistics SRL; INTER CARS ROMANIA SRL
lettable area: 18,085 m²
built: 2017

VGP Park Timișoara

BUILDING B
tenant: UPS Romania S.R.L.; World Media Trans S.R.L.; Acila SRL; Ericsson Antenna Technology Romania S.R.L.; ITC LOGISTIC ROMANIAS.R.L., DUMERA S.R.L.; EUTRON ELECTRONIC SERVICES S.R.L.; EKOLINTERNATIONAL LOGISTICS S.R.L
lettable area: 17,976 m²
built: 2015

VGP Park Timișoara

BUILDING B
tenant: DHL Freight Romania SRL; RESET EMS srl; S.C.; NEFAB PACKAGING ROMANIA SRL; HELBAKO ELECTRONICA SRL; LOSAN DEPOT SRL; SZW AUTOMOTIVE S.R.L.; D.B. GROUP ROMANIA S.R.L.; World Media Trans S.R.L.
lettable area: 18,176 m²
built: 2016

VGP Park Timișoara

BUILDING C
tenant: cargo-partner Expeditii S.R.L.; EUROCCOPER S.A.; DELIVERY SOLUTIONS S.A.; DYNAMIC PARCEL DISTRIBUTION S.A.
lettable area: 21,879 m²
built: 2019

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VGP Park Timișoara

BUILDING C
tenant: Hafele Romania SRL; SYNTRONIC PRODUCTION AND AFTERMARKET SERVICES S.R.L.; CONTINENTAL AUTOMOTIVE PRODUCTS SRL; Ericsson Anteena Technology Romania SRL; DHL International Romania SRL
lettable area: 21,581 m²
built: 2019

VGP Park Timișoara

BUILDING D
tenant: RPW LOGISTICS SRL; World Media Trans S.R.L.
lettable area: 30,775 m²
built: 2021

VGP Park Brasov

BUILDING A
tenant: ECOPAL DISTRIBUTION SRL; DACHSER ROMANIA SRL; NEFAB PACKAGING ROMANIA SRL; DRIM DANIEL DISTRIBUŢIE FMCG SRL; OLSTRAL HPT SRL; TRADY 2000 SRL; COS 2000 DISTRIBUTION SRL; KARL HEINZ DIETRICH INTERNATIONAL EXPED SRL; ITC LOGISTIC ROMANIA SRL; TRANSMEC RO SRL; AUTOLIV ROMANIA SRL
lettable area: 28,956 m²
built: 2023

VGP Park Brasov

BUILDING B
tenant: AUTOLIV ROMANIA SRL
lettable area: 20,920 m²
built: 2023

VGP Park Brasov

BUILDING E
tenant: FILDAS TRADING SRL; ITC LOGISTIC ROMANIA S.R.L.
lettable area: 9,556 m²
built: 2021

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VGP Park Brasov

BUILDING I
tenant: SCHENKER LOGISTICS ROMANIA S.A.; DYNAMIC PARCEL DISTRIBUTION SA; MIELE TEHNICA SRL; RETURO SISTEM GARANŢIE RETURNARE S.A.
lettable area: 17,465 m²
built: 2023

VGP Park Arad

BUILDING A
tenant: KUEHNE + NAGEL S.R.L.; Fan Courier Express SRL; NDB LOGISTICA ROMANIA SRL; DYNAMIC PARCEL DISTRIBUTIONSA; DRIM DANIEL DISTRIBUTIE FMCG SRL; Vodafone Romania SA; CAPS INDUSTRIES RO SRL
lettable area: 29,414 m²
built: 2022

VGP Park Sibiu

BUILDING B
tenant: Englmayer Romania SRL; IKEA ROMANIA S.A.; SOMAREST SRL; VEL PITAR SA; TRANSMEC RO SRL
lettable area: 16,616 m²
built: 2022

VGP Park Bucharest

BUILDING C
tenant: SELECT FRUITS SRL; GOLDEN PROVIDER DISTRIBUTIONSRL; ASTON COM SA; ALASKA ENERGIES SRL; INTER CARS ROMANIASRL
lettable area: 30,507 m²
built: 2023

VGP Park Bucharest

BUILDING D
tenant: RAWPLUG ROMANIA SRL; S.C Würth Romania S.R.L.; TOMRA COLLECTION ROMANIA S.R.L.
lettable area: 15,699 m²
built: 2023

AUSTRIA

VGP Park Graz

BUILDING A
tenant: MAGNA Steyr Fahrzeugtechnik GmbH & Co.# OTHER EUROPEAN COUNTRIES PORTFOLIO 2023

KG lettable area 16,537 m² built 2017	AUSTRIA VGP Park Graz BUILDING B tenant WeShip Fulfillment GmbH; LEVL GmbH; Johann Weiss GmbH lettable area 8,212 m² built 2022	AUSTRIA VGP Park Graz BUILDING C tenant Amazon Transport Austria GmbH lettable area 14,348 m² built 2023	NETHERLANDS VGP Park Nijmegen BUILDING A tenant Conpax Beheer B.V.; ESTG B.V.; Ahold Europe Real Estate & Construction B.V.; Nippon Express (Nederland) B.V.; OTC Medical B.V.; VGP Renewable Energy Netherlands BV; Albert Heijn B.V.- afdeling online lettable area 67,352 m² built 2020	NETHERLANDS VGP Park Nijmegen BUILDING B, B tenant Holding Geurtsen Thomassen B.V.; VGP Renewable Energy Netherlands BV lettable area 42,505 m² built 2021
OTHER EUROPEAN COUNTRIES PORTFOLIO 2023 PAGE 27	NETHERLANDS VGP Park Nijmegen BUILDING B, B tenant VGP Renewable Energy Netherlands BV, Bol.com B.V. lettable area 62,520 m² built 2022	NETHERLANDS VGP Park Nijmegen BUILDING C tenant Mantel Arnhem B.V., Holding Geurtsen Thomassen B.V.; VGP Renewable Energy Netherlands BV lettable area 35,052 m² built 2022	NETHERLANDS VGP Park Roosendaal BUILDING A tenant Active Ants B.V.; Raben Netherlands B.V.; VGP Renewable Energy Netherlands BV lettable area 41,960 m² built 2020	NETHERLANDS VGP Park Roosendaal BUILDING B tenant Loendersloot Global Logistics BV lettable area 9,294 m² built 2023
ITALY VGP Park Valsamoggia BUILDING A tenant Macron S.p.a.; VGP Renewable Energy Italy SRL lettable area 6,679 m² built 2020	PAGE 28 VGP NV ANNUAL REPORT 2023 OTHER EUROPEAN COUNTRIES ITALY VGP Park Valsamoggia BUILDING B tenant Macron S.p.a. lettable area 16,106 m² built 2019	ITALY VGP Park Calcio BUILDING A tenant FGC S.r.l.; Consorzio Service Internation CSI; VGP Renewable Energy Italy SRL lettable area 23,303 m² built 2020	ITALY VGP Park Sordio BUILDING A tenant General Logistics Systems Italy S.P.A; VGP Renewable Energy Italy SRL lettable area 12,035 m² built 2021	ITALY VGP Park Padova BUILDING A tenant Carlini Gomme s.r.l.; Gruber Logistics S.p.A. lettable area 15,301 m² built 2021
ITALY VGP Park Padova BUILDING B tenant Gruppo Executive Societa Consortile a r.l. lettable area 7,246 m² built 2021	OTHER EUROPEAN COUNTRIES PORTFOLIO 2023 PAGE 29 ITALY VGP Park Parma Lumiere BUILDING A tenant GLS Enterprise s.r.l. lettable area 5,710 m² built 2022	PORTUGAL VGP Park Santa Maria da Feira BUILDING A tenant Rádio Popular – Electrodomésticos, S.A. lettable area 29,813 m² built 2021	PORTUGAL VGP Park Loures BUILDING A tenant DPD Portugal Transporte Expresso, S.A lettable area 12,606 m² built 2023	PORTUGAL VGP Park Loures BUILDING B tenant DHL Parcel Portugal; Unipessoal, Lda. lettable area 7,143 m² built 2023
PAGE 30 VGP NV ANNUAL REPORT 2023 OTHER EUROPEAN COUNTRIES
LATVIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Kekava	VGP	148,442	62,829	—
VGP Park Riga	VGP	119,031	41,816	—
VGP Park Tiraines	VGP	63,149	28,897	—
Total VGP		330,622	133,542	—
ROMANIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Timisoara JV2		252,439	115,310	—
VGP Park Timisoara 2 JV2		40,285	30,775	—
VGP Park Arad	VGP	388,977	29,414	—
VGP Park Brașov	VGP	361,527	76,897	53,278
VGP Park Bucharest	VGP	248,289	46,206	—
VGP Park Bucharest 2	VGP	227,782	—	—
VGP Park Sibiu	VGP	217,232	16,616	—
VGP Park Timisoara 3	VGP	56,374	—	32,768
Total Joint Ventures		292,724	146,085	—
Total VGP		1,500,181	169,133	86,046
HUNGARY	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Alsónémedi JV1		85,349	31,679	—
VGP Park Győr JV1		121,799	51,495	—
VGP Park Hatvan	VGP	37,808	16,664	—
VGP Park Budapest Aerozone	VGP	378,859	24,559	29,853
VGP Park Budapest Aerozone 2	VGP	372,798	—	—
VGP Park Győr Béta	VGP	142,294	13,915	37,998
VGP Park Hatvan	VGP	21,776	9,317	9,317
VGP Park Kecskemét	VGP	255,031	59,132	38,022
Total Joint Ventures		207,148	83,174	—
Total VGP		1,208,566	114,270	105,873
SLOVAKIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Malacky JV1		220,492	88,615	—
VGP Park Bratislava	VGP	575,624	138,244	39,624
VGP Park Bratislava Committed		239,517	—	—
VGP Park Bratislava 2	VGP	365,928	—	—
VGP Park Zvolen	VGP	102,074	—	8,480
Total Committed		239,517	—	—
Total Joint Ventures		220,492	88,615	—
Total VGP		1,043,626	138,244	48,104
AUSTRIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Graz JV2		38,239	16,537	—
VGP Park Ehrenfeld	VGP	189,367	—	33,146
VGP Park Graz 2	VGP	100,117	22,560	—
VGP Park Laxenburg	VGP	111,477	—	49,448
Total Joint Ventures		38,239	16,537	—
Total VGP		400,961	22,560	82,594
OTHER EUROPEAN COUNTRIES PORTFOLIO 2023 PAGE 30
THE NETHERLANDS	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Nijmegen JV2		162,214	67,352	—
VGP Park Nijmegen 2 JV2		200,272	140,077	—
VGP Park Roosendaal JV2		86,511	51,254	—
VGP Park Moerdijk LPM JV		719,762	—	—
VGP Park Nijmegen 3	VGP	238,041	—	—
Total Joint Ventures		1,168,759	258,683	—
Total VGP		238,041	—	—
ITALY	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Verona Committed		171,925	—	—
VGP Park Calcio JV2		48,593	23,303	—
VGP Park Padova JV2		50,091	22,547	—
VGP Park Parma Lumiere JV2		18,865	5,710	—
VGP Park Sordio JV2		26,811	12,035	—
VGP Park Valsamoggia JV2		52,776	22,784	—
VGP Park Legnano	VGP	50,177	—	—
VGP Park Paderno Dugano	VGP	92,288	—	—
VGP Park Parma Paradigna	VGP	99,487	—	—
VGP Park Valsamoggia 2 (Lunga)	VGP	125,184	—	18,782
Total Committed		171,925	—	—
Total Joint Ventures		197,136	86,380	—
Total VGP		367,136	—	18,782
PORTUGAL	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Santa Maria da Feira JV2		73,578	29,813	—
VGP Park Loures	VGP	51,526	19,749	—
VGP Park Montijo	VGP	75,550	—	31,789
VGP Park Sintra	VGP	57,368	—	—
Total Joint Ventures		73,578	29,813	—
Total VGP		184,444	19,749	31,789
SERBIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Belgrade – Dobanovci	VGP	1,160,544	—	76,938
Total VGP		1,160,544	—	76,938
CROATIA	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Zagreb Lučko	VGP	95,306	—	—
Total VGP		95,306	—	—
FRANCE	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Mulhouse	VGP	213,472	—	—
VGP Park Rouen 1	VGP	81,468	—	39,330
VGP Park Rouen 2	VGP	78,115	—	—
VGP Park Rouen 3	VGP	161,708	—	—
VGP Park Vélizy	VGP	193,665	—	—
Total VGP		728,428	—	39,330
DENMARK	Owner	Land area (m²)	Lettable area (m²)	Contracted annual rent (in million €)
VGP Park Vejle Committed		175,256	—	—
Total VGP		175,256	—	—
PAGE 31 VGP NV ANNUAL REPORT 2023 FINANCIAL REVIEW 2023
PAGE 319 Financial review 2023	PAGE 320 VGP NV ANNUAL REPORT 2023 CONTENT
Content	Consolidated income statement — page 290	Consolidated statement of comprehensive income — page 291	Notes to and forming part of the financial statements — page 293	Glossary of terms — page 380
Consolidated cashflow statement — page 295	Auditor’s report — page 360	FINANCIAL REVIEW 2023 PAGE 321	CONTENT	Consolidated balance sheet — page 294
PAGE 322 VGP NV ANNUAL REPORT 2023
## CONSOLIDATED INCOME STATEMENT
Consolidated income statement
For the year ended 31 December 2023
Income Statement (in thousand of €)	Note	31. 12. 2023	31. 12. 2022
Revenue	1	113,722	84,784
Gross rental and renewable energy income	5	69,003	51,230
Net property operating expenses	6	(5,534)	(8,223)
Net rental and renewable energy income		63,469	43,007
Joint venture management fee income	5	26,925	21,537
Net valuation gains/(losses) on investment properties	2	87,958	(97,230)
Administration expenses	8	(48,863)	(33,956)
Share in result of Joint Ventures	9.1	(10,715)	(45,927)
Other expenses		—	(3,000)
Operating result		118,774	(115,569)
Financial income	10	34,076	17,329
Financial expenses	10	(40,107)	(44,337)
Net financial result		(6,031)	(27,008)
Result before taxes		112,743	(142,577)
Taxes	11	(25,451)	20,035
Result for the period		87,292	(122,542)
Attributable to:
Shareholders of VGP NV		87,292	(122,542)
Non-controlling interests		—	—
Earnings Per Share	3
(in €)	Note	31. 12. 2023	31. 12. 2022
Basic earnings per share	12	3.20	(5.49)
Diluted earnings per share	12	3.20	(5.49)
The consolidated income statement should be read in conjunction with the accompanying notes.
1 Revenue is composed of gross rental and renewable energy income, service charge income, property and facility management income and property development income.
2 Includes realized gains on disposals of subsidiaries of € 59 million in '23 and € 87.2 million in '22
3 Calculated based on the weighted average number of shares amounting to 22,311,583 shares as at 31 December 2022. The total issued shares at year-end 2022 and for the full year 2023 were 27,291,312 shares.
FINANCIAL REVIEW 2023 PAGE 323
## CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Consolidated statement of comprehensive income
For the year ended 31 December 2023
Statement of comprehensive income (in thousand of €)	31. 12. 2023	31. 12. 2022	# 2022 Result for the year
87,292 (122,542)

Other comprehensive income to be reclassified to profit or loss — —
Other comprehensive income not to be reclassified to profit or loss — —
Other comprehensive income for the period — —
Total comprehensive income/(loss) of the period 87,292 (122,542)

Attributable to:
Shareholders of VGP NV 87,292 (122,542)
Non-controlling interest — —

PAGE 324

VGP NV ANNUAL REPORT 2023

CONSOLIDATED BALANCE SHEET

Consolidated balance sheet
For the year ended 31 December 2023

Assets (in thousand of €)	Note	31. 12. 2023	31. 12. 2022
Intangible assets		1,000	1,200
Investment properties	13	1,508,984	2,395,702
Property, plant and equipment		107,426	73,280
Investments in Joint Ventures and associates	9.2, 9.4	1,037,228	891,201
Other non-current receivables	9.3	565,734	359,644
Deferred tax assets	11	8,304	3,839
Total non-current assets		3,228,676	3,724,866
Trade and other receivables	14	79,486	122,113
Cash and cash equivalents	15	209,921	699,168
Disposal group held for sale	20	892,621	299,906
Total current assets		1,182,028	1,121,187
Total Assets		4,410,704	4,846,053

Shareholders’ Equity and Liabilities (in thousand of €)	Note	31. 12. 2023	31. 12. 2022
Share capital	16	105,676	105,676
Share premium	16	845,579	845,579
Retained earnings		1,263,162	1,250,920
Shareholders’ equity		2,214,417	2,202,175
Non-current financial debt	17	1,885,154	1,960,464
Other non-current liabilities	18	38,085	46,419
Deferred tax liabilities	11	23,939	79,671
Total non-current liabilities		1,947,178	2,086,554
Current financial debt	17	111,750	413,704
Trade debts and other current liabilities	19	84,075	110,676
Liabilities related to disposal group held for sale	20	53,284	32,944
Total current liabilities		249,109	557,324
Total liabilities		2,196,287	2,643,878
Total Shareholders’ Equity and Liabilities		4,410,704	4,846,053

The consolidated balance sheet should be read in conjunction with the accompanying notes.

FINANCIAL REVIEW 2023
PAGE 325

STATEMENT OF CHANGES IN EQUITY

Statement of changes in equity
For the year ended 31 December 2023

Statement of changes in equity (in thousand of €)

	Statutory Capital	reserve IFRS	Other reserves	Retained earnings	Total equity
Balance as at 1 January 2022	108,874	(30,416)	78,458	574,088	1,523,019
Other comprehensive income/(loss)	—	—	—	—	—
Result of the period	—	—	—	—	(122,542)
Effect of disposals	—	—	—	—	—
Total comprehensive income/(loss)	—	—	—	—	(122,542)
Capital and share premium increase net of transaction costs	27,218	—	27,218	271,491	—
Share capital distribution to shareholders	—	—	—	—	—
Dividends	—	—	—	—	(149,557)
Balance as at 31 December 2022	136,092	(30,416)	105,676	845,579	1,250,920
Balance as at 1 January 2023	136,092	(30,416)	105,676	845,579	1,250,920
Other comprehensive income/(loss)	—	—	—	—	—
Result of the period	—	—	—	—	87,292
Effect of disposals	—	—	—	—	—
Total comprehensive income/(loss)	—	—	—	—	87,292
Capital and share premium increase net of transaction costs	—	—	—	—	—
Share capital distribution to shareholders	—	—	—	—	—
Dividends	—	—	—	—	(75,050)
Balance as at 31 December 2023	136,092	(30,416)	105,676	845,579	1,263,162

PAGE 326

VGP NV ANNUAL REPORT 2023

CONSOLIDATED CASHFLOW STATEMENT

Consolidated cashflow statement
For the year ended 31 December 2023

Cash flow statement (in thousand of €)

	Note	31. 12. 2023	31. 12. 2022
Cash flows from operating activities	21
Result before taxes		112,743	(142,577)
Adjustments for:
Depreciation		5,920	4,479
Unrealised (gains)/losses on investment properties	7	(28,938)	184,447
Realised (gains)/losses on disposal of subsidiaries and investment properties	7	(59,020)	(87,217)
Unrealised (gains)/losses on financial instruments and foreign exchange		(73)	1,426
Interest (income)		(34,003)	(17,329)
Interest expense		40,107	42,911
Share in (profit)/loss of Joint Ventures and associates	9.1	10,715	45,927
Operating profit before changes in working capital and provisions		47,451	32,067
Decrease/(Increase) in trade and other receivables		(20,773)	(43,215)
(Decrease)/Increase in trade and other payables		12,532	(12,632)
Cash generated from the operations		39,210	(23,780)
Interest received		6,713	24
Interest paid		(57,331)	(39,292)
Income taxes paid		(15,923)	(7,590)
Net cash generated from operating activities		(27,331)	(70,638)
Cash flows from investing activities	21
Proceeds from disposal of tangible assets and other		—	—
Proceeds from disposal of subsidiaries and investment properties	22	676,245	347,372
Investments in Investment Property and Property Plant and Equipment		(667,015)	(851,792)
Distribution by/(investment in) Joint Ventures and associates		12,823	21,382
Loans provided to Joint Ventures and associates		(99,371)	(108,443)
Loans repaid by Joint Ventures and associates		69,241	25,331
Net cash used in investing activities		(8,078)	(566,150)
Cash flows from financing activities	21
Dividends paid		(75,050)	(149,557)
Net Proceeds/(cash out) from the issue/(repayment) of share capital		—	298,709
Net Proceeds from sale of own shares		—	—
Proceeds from loans		—	990,749
Loan repayments		(375,000)	(23,500)
Net cash used in financing activities		(450,050)	1,116,401
Net increase/(decrease) in cash and cash equivalents		(485,459)	479,613
Cash and cash equivalents at the beginning of the period		699,168	222,160
Effect of exchange rate fluctuations		(569)	(157)
Reclassification to (–)/from held for sale		(3,219)	(2,448)
Cash and cash equivalents at the end of the period		209,921	699,168

The consolidated cash flow statement should be read in conjunction with the accompanying notes.

1 The movement on the receivables due to the sale of entities to the Joint Ventures amount € -53.8 million. Next to this, reclassification occur mainly with respect to receivable from Allianz which is shown as proceeds from disposal of subsidiaries and investment properties for an amount of € 7 million (See note 22).
2 Some reclassifications occur mainly with respect to receivable from Allianz which is shown as proceeds from disposal of subsidiaries and investment properties for an amount of € 56.7 million (See note 22).

FINANCIAL REVIEW 2023
PAGE 327

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Notes to and forming part of the financial statements

1 General Information

VGP NV (the “Company”) is a limited liability company and was incorporated under Belgian law on 6 February 2007 for an indefinite period of time with its registered office located at Generaal Lemanstraat 55 box 4, 2018 Antwerp, Belgium and the Company is registered under enterprise number 0887.216.042 (Register of Legal Entities of Antwerp – Division Antwerp).

The Group is a pure-play real estate group specialised in the acquisition, development, and management of logistic real estate, i.e. buildings suitable for logistical purposes and light industrial activities. The Group focuses on strategically located plots of land or brownfields suitable for development of logistic business parks of a certain size, so as to build up an extensive and well-diversified land bank on top locations, i.e. locations in the vicinity of highly concentrated living and/ or production centres, with an optimal access to transport infrastructure. The aim of the Group is to become a leading pan-European owner, manager and developer of high-quality logistics and semi-industrial real estate. The Group is currently active in Germany, Austria, the Neth- erlands, Spain, Portugal, Italy, the Czech Republic, the Slovak Republic, Hungary, Romania, Latvia, Croatia, France, Denmark and Serbia. The Company’s consolidated financial statements include those of the Company and its subsidiaries (together referred to as “Group”). The consolidated financial statements were approved for issue by the board of directors on 4 April 2024.

2 Summary of principal accounting policies

2.1 Statement of compliance

The consolidated financial statements have been prepared in accordance with the requirements of International Finan- cial Reporting Standards (IFRS) which have been adopted by the European Union. These standards comprise all new and revised standards and interpretations published by the Inter- national Accounting Standards Board (IASB) and interpre- tations issued by the International Financial Interpretations Committee of the IASB, as far as applicable to the Group’s activities and effective as from 1 January 2023.

Standards and interpretations applicable for the annual report beginning on or after 1 January 2023
* IFRS 17 Insurance Contracts
* Amendments to IFRS 17 Insurance contracts: Initial Appli- cation of IFRS 17 and IFRS 9 – Comparative Information
* Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting Policies
* Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors: Definition of Accounting Estimates
* Amendments to IAS 12 Income Taxes: Deferred Tax related to Assets and Liabilities arising from a Single Transaction
* Amendments to IAS 12 Income taxes: International Tax Reform – Pillar Two Model Rules (effective immediately – disclosures are required for annual periods beginning on or after 1 January 2023)

The above new standards, amendments to standards and interpretations did not give rise to any material changes in the presentation and preparation of the consolidated financial statements of the year.# Standards and interpretations published, but not yet appli- cable for the annual period beginning on 1 January 2023:

• Amendments to IAS 1 Presentation of Financial State- ments: Classification of Liabilities as Current or Non-cur- rent and Non-current Liabilities with Covenants (applicable for annual periods beginning on or after 1 January 2024)
• Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback (applicable for annual periods beginning on or after 1 January 2024)
• Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures: Supplier Finance Arrangements (applicable for annual periods beginning on or after 1 January 2024, but not yet endorsed in the EU)

For the year ended 31 December 2023 PAGE 328 VGP NV ANNUAL REPORT 2023 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

• Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability (applicable for annual periods beginning on or after 1 January 2025, but not yet endorsed in the EU)

The initial application of the above standards, amendments to standards and interpretation is estimated not to give rise to any material changes in the presentation and preparation of the consolidated financial statements.

2.2 Basis of preparation

The consolidated financial statements are prepared on a his- toric cost basis, with the exception of investment properties and financial derivatives which are stated at fair value. All figures are in thousands of Euros (in thousands of €), unless stated otherwise. Minor rounding differences might occur.

2.3 Principles of consolidation

Subsidiaries

Subsidiaries are entities over which VGP NV exercises control, which is the case when the Company is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect these returns through its power over the entity. Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unreal- ised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. Sub- sidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit bal- ance. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it:

• Derecognises the assets (including goodwill) and liabili- ties of the subsidiary
• Derecognises the carrying amount of any non-controlling interest
• Derecognises the cumulative translation differences, recorded in equity
• Recognises the fair value of the consideration received
• Recognises the fair value of any investment retained
• Recognises any surplus or deficit in profit or loss
• Reclassifies the parent’s share of components previously recognised in other comprehensive income to profit or loss or retained earnings, as appropriate.

Joint ventures and associates

A joint venture exists when VGP NV has contractually agreed to share control with one or more other parties, which is the case only when decisions about the relevant activities require the unanimous consent of the parties sharing control. Associates are companies in which VGP NV, directly or indi- rectly, has a significant influence and which are neither sub- sidiaries nor joint ventures. This is presumed if the Group holds at least 20% of the voting rights attaching to the shares. The financial information included for these companies is pre- pared using the accounting policies of the Group. When the Group has acquired joint control in a joint venture or signif- icant influence in an associate, the share in the acquired assets, liabilities and contingent liabilities is initially re-meas- ured to fair value at the acquisition date and accounted for using the equity method. Any excess of the purchase price over the fair value of the share in the assets, liabilities and con- tingent liabilities acquired is recognized as goodwill. When the goodwill is negative, it is immediately recognized in profit or loss. Subsequently, the consolidated financial statements include the Group’s share of the results of joint ventures and associates accounted for using the equity method until the date when joint control or significant influence ceases. If the Group’s share of the losses of a joint venture or associ- ate exceeds the carrying amount of the investment, the invest- ment is carried at nil value and recognition of additional losses is limited except to the extent that VGP has incurred construc- tive or contractual obligations in respect of the associate. Unrealized gains arising from transactions with joint ven- tures and associates are set against the investment in the joint venture or associate concerned to the extent of the Group’s interest. The carrying amounts of investments in joint ventures and associates are reassessed if there are indications that the asset has been impaired or that impairment losses recognized in prior years have ceased to apply. The investments in joint ventures and associates in the balance sheet include the car- rying amount of any related goodwill. IAS 28.28 only permits recognition of the gain or loss from downstream transactions “to the extent of unrelated inves- tors’ interests in the associate or joint venture”. However, the standard does not specifically address the treatment of rev- enue derived from transactions with equity-method invest- ees (e.g. revenue from the sale of goods, or interest revenue) and whether that revenue should be eliminated from the con- solidated financial statements. In respect of the treatment of revenues derived from transactions with joint ventures and associates (e.g. sales services, interest revenue, …), the Group has opted not to eliminate its interest in these trans- actions. As a matter of example, VGP receives € 100 interest income on a loan provided to a 50/50 joint venture. Under the accounting policy adopted by VGP this interest income would be accounted for as € 100 interest income of the Group. The cost incurred by the joint venture would be accounted for on a proportional (50%) basis through “results in joint ventures and associates” without making any adjustment for the propor- tional interest held by VGP. By doing so the Group will only rec- ognise its proportional profit or loss in its consolidated figures and ensure that it does not recognise a higher profit or loss than its share in the “results in joint ventures and associates”. In contrast, according to IFRS 10.25 upon loss of control of a subsidiary, a parent de-recognises the assets and liabilities of the subsidiary (including non-controlling interests) in full and measures any investment retained in the former subsidiary at its fair value. In the absence of any other relevant guidance, entities have, in effect, an accounting policy choice of apply- ing either the approach in IFRS 10 or the approach in IAS 28. VGP has made the accounting policy choice to recognize the gain or loss on the disposal of a subsidiary to a joint venture or associate in full in profit or loss.

2.4 Foreign currency translation

Items included in the financial statements of each of the Group’s entities are measured using the currency of the pri- mary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in euros (€), which is the Company’s functional currency and the Group’s presentation currency. Transactions in foreign currencies are translated to Euro at the foreign exchange rate ruling at the date of the transaction. Consequently, non-monetary assets and liabilities are pre- sented at Euro using the historic foreign exchange rate. Mon- etary assets and liabilities denominated in a currency other than Euro at the balance sheet date are translated to Euro at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the con- solidated income statement.

FINANCIAL REVIEW 2023 PAGE 329NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2.5 Goodwill

When VGP acquires the control over an integrated set of activ- ities and assets, as defined in IFRS 3 Business Combinations, the identifiable assets, obligations and conditional obligations of the acquired company will be booked to their fair value on the purchase date. The goodwill represents the positive differ- ence between the acquisition cost and the part of the group in the fair value of the acquired net assets. If this difference is negative (negative goodwill) it is immediately booked in the result after a re-evaluation of the values. After the initial take-up the goodwill is not written down, but subject to an impairment test, which is carried out each year on the cash flow generating units to which the goodwill is allocated. If the book value of a cash flow generating unit exceeds the oper- ating value, the loss of value following from this will be booked in the result and in the first instance included in the reduction of the possible goodwill and then subsequently to the other assets of the unit, in proportion to their book value. A write-down on the goodwill cannot be reversed in a subsequent financial year.

2.6 Intangible assets

Intangible assets are measured at cost or fair value less accumulated amortization and any accumulated impairment losses. Intangible assets are amortized on a straight-line basis over the best estimate of their useful lives. The amortization period and method are reviewed at each financial year-end.# 2.7 Investment properties

Completed projects

Completed properties are initially measured at cost (including transaction costs). After initial recognition, investment property is carried at fair value. An external independent valuation expert with recognised professional qualifications and experience in the location and category of the property being valued, values the portfolio at least annually. The fair values are based on market values, being the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. Any gain or loss arising from a change in fair value is recognised in the consolidated income statement.

Property under construction

Property that is being constructed or developed is also stated at fair value. The properties under construction are also valued by an external independent valuation expert using the same valuation methodology as used for the valuations of the completed projects but deducting the remaining construction costs from the calculated market value of the respective projects. Any gain or loss arising from a change in fair value is recognised in the consolidated income statement. All costs directly associated with the purchase and construction of a property and all subsequent capital expenditure qualifying as acquisition costs are capitalised.

Development land

Land of which the Group has the full ownership i.e. registered in the respective land registry as owner and on which the Group intends to start construction (so called “development land”) is immediately valued at fair value. The development land is valued by an external independent valuation expert using the valuation sales comparative approach. Any gain or loss arising from a change in fair value is recognised in the consolidated income statement. All costs directly associated with the purchase of the development land are capitalised.

Land which is not yet in full ownership but which is secured by a future purchase agreement or purchase option is not recognised as investment property until the Group has become full owner of this land. The Group will be required to make from time to time down payments when entering into such future purchase agreements or purchase options. The down payments of the land will be recorded as other receivables unless such amounts are immaterial, in which case the Board of Directors may elect to classify such amounts under investment properties.

Infrastructure works are not included in the fair value of the development land but are recognised as investment property and valued at cost. In case the Board of Directors is of the opinion that the fair value of the development land cannot be reliably determined the Board may elect to value the development land at cost less impairment until the fair value becomes reliably determinable.

2.8 Capitalisation of borrowing costs

Interest and other financial expenses relating to the acquisition and development of assets incurred until the asset is put in use are capitalised. Subsequently, they are recorded as financial expenses.

2.9 Leases

VGP as lessee

At the start of the lease period, the leases (except for leases with a maximum term of twelve months and leases whose underlying assets are of low value) are recognised on the balance sheet as rights of use and lease liabilities at the present value of the future lease payments. Next, all rights of use that qualify as investment properties are valuated at fair value, in accordance with the valuation rules detailed under 2.7 Investment properties. The minimum lease payments are recognised in part as financing costs and in part as settlement of the outstanding liability, in a manner resulting in a constant periodic interest rate on the remaining balance of the liability. The cost of financing is offset directly against the result. Conditional lease payments are incorporated as costs in the periods in which they were made.

VGP as lessor

If a lease meets the conditions of a financial lease (according to IFRS 16), VGP as the lessor will recognise the lease from its start date as a receivable in the balance sheet at an amount equal to the net investment in the lease. The difference between this latter amount and the book value of the leased property (exclusive of the value of the residual right held by VGP) at the start of the lease will be recognised in the profit and loss account for that period. Each periodic payment made by the lessee will be partly recognised by VGP as a repayment of the capital and partly as financial income based on a constant periodic return for VGP. The residual right held by VGP will be recognised at its fair value on each balance sheet date. This value will increase every year and will correspond to the market value of the full right of ownership at the end of the lease. These increases will be recognised in Net valuation gains/(losses) on investment properties in the profit and loss account.

Group company is the lessor – fees paid in connection with arranging leases and lease incentives

The Group makes payments to agents for services in connection with negotiating lease contracts with the Group’s lessees. PAGE 330 VGP NV ANNUAL REPORT 2023 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS The letting fees are capitalised within the carrying amount of the related investment property and amortised over the lease term. Lease incentives are recognised as a reduction of rental income on a straight-line basis over the lease term.

2.10 Property, plant and equipment

Property, plant and equipment are valued at their cost price less the accumulated depreciations and write-downs. The cost price includes all directly attributable costs and the relevant part of the indirect costs incurred to make the asset ready for use. Future disbursements for repairs are immediately recorded in the result unless they increase the future financial profits of the asset. The straight-line depreciation method is applied over the estimated lifetime of the assets. The useful life and the depreciation method are revised at least annually at the end of each financial year. The tangible fixed assets are depreciated in accordance with the following percentages:
* software: 33%;
* IT equipment: 10–33%;
* office furniture and fittings: 7–20%;
* cars: 25%;
* photovoltaic panels 5%

2.11 Financial assets at amortised cost

Financial assets at amortized cost include trade receivables, other receivables and cash and cash equivalents and represent non-derivative financial instruments which are held within a business model with the purpose to receive contractual cashflows (held to collect) and the contractual terms of the financial asset give rise to cashflows at fixed dates which represent solely payments of principal and interest (SPPI). Such financial assets are stated at amortised cost with any difference between cost and redemption value being recognised in the consolidated income statement over the period of the financial assets on an effective interest basis. Trade receivables do not carry any interest and are stated at amortised cost as reduced by appropriate bad debt allowances. Such allowances are based on the expected credit losses, calculated in accordance with IFRS 9. The group has not developed a provision matrix based on historical credit loss experience as historical credit losses are insignificant. In case there has been a significant increase in credit risk since initial recognition, the Group recognises lifetime expected credit losses. This is the case when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter into bankruptcy or financial reorganization, and default or delinquency in payments are considered indicators that the default risk has significantly increased. An impairment loss is recognized in the statement of income, as are subsequent recoveries of previous impairments. Other financial assets at amortized cost include mainly loan to joint ventures and associates. These financial assets are accounted for at amortized cost and the Group recognizes a loss allowance for expected credit losses in accordance with IFRS 9. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition of the respective financial asset. Cash and cash equivalents comprise cash balances and call deposits. Such cash balances are only held with banks with high credit ratings, as such expected credit losses are not deemed significant. Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash equivalents for the purpose of the consolidated cash-flow statement.

2.12 Non-current assets held for sale and discontinued operations

A non-current asset or disposal group is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. A discontinued operation is a component of an entity which the entity has disposed of or which is classified as held for sale, which represents a separate major line of business or geographical area of operations and which can be distinguished operationally and for financial reporting purposes.# NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

2.13 Interest bearing borrowings

Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in the consolidated income statement over the period of the borrowings on an effective interest basis. The Group classifies as a current portion any part of long-term loans that is due to be settled within one year from the balance sheet date.

2.14 Trade and other payables

Trade and other payables are stated at amortised cost.

2.15 Derivative financial instruments

The Group does not apply hedge accounting in accordance with IFRS 9. Derivative financial assets and liabilities are classified as financial assets or liabilities at Fair Value through Profit or Loss (FVPL). Derivative financial assets and liabilities comprise mainly interest rate swap and forward foreign exchange contracts for hedging purposes (economic hedge). Recognition of the derivative financial instruments takes place when the economic hedging contracts are entered into. They are measured initially and subsequently at fair value; transaction costs are included directly in finance costs. Gains or losses on derivatives are recognised in profit or loss in net change in fair value of financial instruments at FVPL.

2.16 Impairment on property, plant and equipment and intangible assets

The carrying amounts of the Group’s property, plant and equipment and intangible assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the consolidated income statement. Impairment losses recognised in respect of cash-generating units reduce the carrying amount of the assets in the unit (group of units) on a pro-rata basis.

2.17 Reversal of impairment

An impairment loss is reversed in the consolidated income statement if there has been a change in the estimates used to determine the recoverable amount to the extent it reverses an impairment loss of the same asset that was recognised previously as an expense.

2.18 Provisions

A provision is recognised in the consolidated balance sheet when the Group has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

2.19 Revenue recognition

Revenue includes rental income, renewable energy income, property and facility management income, development management income and service charge income. Rental income from operating leases is recognised on a straight-line basis over the lease term. When the Group provides incentives to its tenants, the cost of the incentives is recognised over the lease term, on a straight-line basis, as a reduction of rental income. Renewable energy income includes multiple streams, such as sale of energy, leasing of installations and government grants. The accounting treatment for solar revenue depends on the specific contractual terms of the agreement between VGP’s renewable energy company and its customers (e.g. tenants or green energy suppliers). If VGP’s renewable energy company has entered into a power purchase agreement (PPA) with its customers, revenue recognition is based on the delivery of electricity. VGP’s renewable energy company recognizes revenue when electricity is delivered, based on the contractual price per kilowatt-hour (kWh). The revenue recognized is based on the amount of electricity delivered, and any adjustments to the contract price or revenue recognition will be made based on the terms of the PPA. If VGP’s renewable energy company has entered into a leasing agreement with its customers, i.e. renting out the solar equipment, the revenue recognition is based on the lease payments due under the lease agreement. VGP’s renewable energy company recognizes revenue based on the lease payments due over the term of the lease agreement, and any adjustments to the lease payments or revenue recognition will be made based on the terms of the lease agreement. Government grants are recognized the year the government grant applies to. Revenue from service and property, facility and development management is recognised in the accounting period in which control of the services are passed to the customer, which is when the service is rendered. For certain service contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided because the customer receives and uses the benefits simultaneously. Some property management contracts may include multiple elements of service, which are provided to tenants. The Group assesses whether the individual elements of service in contracts are separate performance obligations. Where the contracts include multiple performance obligations, and/or lease and non-lease components, the transaction price will be allocated to each performance obligation (lease and non-lease component) based on the stand-alone selling prices. Where these selling prices are not directly observable, they are estimated based on an expected cost, plus margin. In the case of fixed price contracts, the customer pays the fixed amount based on a payment schedule. If the services rendered exceed the payment, a contract asset is recognised. If the payments exceed the services rendered, a contract liability is recognised. Revenue is measured at the transaction price agreed under the contract. Amounts disclosed as revenue are net of variable consideration and payments to customers, which are not for distinct services, this consideration may include discounts, trade allowances, rebates and amounts collected on behalf of third parties. A receivable is recognised when services are provided as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due. When the Group is acting as an agent, the commission rather than gross income is recorded as revenue.

2.20 Expenses

Service costs and property operating expenses

Service costs for service contracts entered into and property operating expenses are expensed as incurred.

Net financial result

Net financial result comprises interest payable on borrowings and interest rate swaps calculated using the effective interest rate method net of interest capitalised, interest receivable on funds invested and interest rate swaps, foreign exchange and interest rate swap gains and losses that are recognised in the consolidated income statement.

Income tax

Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognised in the consolidated income statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantially enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets and deferred tax liabilities have been offset, pursuant to the fulfilment of the criteria of IAS 12 §74. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

3. Critical accounting estimates and judgements and key sources of estimation uncertainty

3.1 General business risk

We refer to the chapter “Risk factors” for an overview of the risks affecting the businesses of the VGP Group.# 3. Critical judgements and estimation uncertainties

3.2 Critical judgements in applying accounting policies

The following are the critical judgments made by management, apart from those involving estimations (see note 3.3. below), that have a significant effect on the amounts reported in the consolidated financial statements:

• Determining whether control, joint control or a significant influence is exercised over investments. In this respect management concluded that it has joint control over the Joint Ventures and hence these Joint Ventures and the related associates are accounted for using the equity method;
• VGP has made the accounting policy choice to recognize the gain or loss on the disposal of a subsidiary to a joint venture or associate in full in profit or loss. In respect of the treatment of revenues derived from transactions with joint ventures and associates (e.g. sales services, interest revenue, …), the Group has opted not to eliminate its interest in these transactions nor to make any adjustment for the proportional adjustment to the joint venture corresponding figures. By doing so the Group will only recognise its proportional profit or loss in its consolidated figures and ensure that it does not recognise a higher profit or loss than its share in the “results in joint ventures and associates”. (See note 2.3 for further information).

3.3 Key sources of estimation uncertainty

VGP’s portfolio is valued at least annually by independent real estate experts. This valuation by real estate experts is intended to determine the market value of a property at a certain date, as a function of the market evolution and the characteristics of the property concerned. The property portfolio is recorded at the fair value established by the real estate experts in the Group’s consolidated accounts. (see note 13)

4. Segment reporting

The chief operating decision maker is the person that allocates resources to and assesses the performance of the operating segments. The Group has determined that its chief operating decision-maker is the chief executive officer (CEO) of the Company. He allocates resources to and assesses the performance at business line and country level. The segmentation for segment reporting within VGP is primarily by business line and secondly by geographical region.

4.1 Business lines

For management purpose, the Group also presents financial information according to management breakdowns, based on these functional allocations of revenues and costs. These amounts are based on a number of assumptions, and accordingly are not prepared in accordance with IFRS audited consolidated financial statements of VGP NV for the period ended 2023 and 2022.

The Group reports three segments as follows:

Investment

The Group’s investment or so-called rental business consists of operating profit generated by the completed and leased out projects of the Group’s portfolio and the proportional share of the operating profit (excluding net valuation gains) of the completed and leased out projects of the Joint Ventures’ portfolio and consolidates as well property and asset management revenue, which include asset management, property management and facility management income. Revenues and expenses allocated to the rental business unit include 10% of the Group’s property operating expenses; other income; other expenses, after deduction of expenses allocated to property development; and share in result of the joint ventures, excluding any revaluation result. Associated operating, administration and other expenses include directly allocated expenses from the respective asset management, property management and facility management service companies.

Property development

The Group’s property development business consists of the net development result on the Group’s development activities. Valuation gains (losses) on investment properties outside the First, Second and Sixth Joint Venture perimeter i.e. Latvia, Croatia, Denmark and Serbia are excluded, as they are assumed to be non-cash generating, on the basis that these assets are assumed to be kept in the Group’s own portfolio for the foreseeable future. In addition, 80% of total property operating expenses are allocated to the property development business, as are administration expenses after rental business and property management expenses.

Renewable Energy

The Group’s Renewable Energy segment includes gross renewable energy income and its direct attributable operating expenses. The renewable energy income is generated through sale of electricity, government grants and/or leasing activities. In addition, 10% of administration expenses are allocated to the Renewable Energy segment. The Renewable Energy segment leases roofs from other VGP entities. To the extent these are not eliminated in the consolidation perimeter, these have been added back as cost, in favor of a revenue recognition in the Investment segment.

Breakdown summary of the business lines

In thousands of €

	31.12.2023	31.12.2022
Investment & Property and Asset Management
EBITDA	171,388	122,139
Property development
EBITDA	42,872	(112,062)
Renewable energy
EBITDA	1,603	3,912
Total EBITDA	215,863	13,989

Adjusted operating profit

For the year ended 31 December 2023

	Investment (+Prop. and asset mng)	Development	Renewable Energy	Intersegment eliminations	Total
Gross rental and renewable energy income	64,705	—	4,361	(63)	69,003
Property operating expenses	(470)	(4,231)	(896)	63	(5,534)
Net property income	64,235	(4,231)	3,465	—	63,469
Joint Venture management fee income	26,925	—	—	—	26,925
Net valuation gains/(losses) on investment properties destined to the Joint Ventures	—	78,667	—	—	78,667
Administration expenses	(9,517)	(31,564)	(1,862)	—	(42,943)
Share of Joint Ventures’ Adjusted profit after tax ¹	89,745	—	—	—	89,745
EBITDA	171,388	42,872	1,603	—	215,863
Other expenses	—	—	—	—	—
Depreciation and amortisation	(698)	(2,790)	(2,432)	—	(5,920)
Earnings before interest and tax	170,690	40,082	(829)	—	209,943
Net financial cost – Own	—	—	—	—	(6,032)
Net financial cost – Joint Ventures and associates	—	—	—	—	(34,199)
Profit before tax	—	—	—	—	169,713
Current income taxes – own	—	—	—	—	(15,923)
Current income taxes – Joint Ventures and associates	—	—	—	—	(6,297)
Recurrent net income	—	—	—	—	147,493
Net valuation gains/(losses) on investment properties – other countries ²	—	—	—	—	9,291
Net valuation gains/(losses) on investment properties – Joint Ventures and associates	—	—	—	—	(61,181)
Net fair value gain/(loss) on interest rate swaps and other derivatives	—	—	—	—	—
Net fair value gain/(loss) on interest rate swaps and other derivatives – Joint Ventures and associates	—	—	—	—	(1,239)
Deferred taxes – own	—	—	—	—	(9,528)
Deferred taxes – Joint Ventures and associates	—	—	—	—	2,455
Reported result for the period	—	—	—	—	87,292

¹ The adjustments to the share of profit from the joint ventures (at share) are composed of € 61.1 million of net valuation losses on investment properties, € 1.2 million of net fair value loss on interest rate derivatives and € 2.5 million of reversal deferred taxes in respect of these adjustments.
² Relates to developments in countries outside of the JV perimeters i.e. Latvia, Croatia, Denmark and Serbia.

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Adjusted operating profit

For the year ended 31 December 2022

	Investment (+Prop. and asset mng)	Development	Renewable Energy	Intersegment eliminations	Total
Gross rental and renewable energy income	45,391	—	5,901	(62)	51,230
Property operating expenses	(792)	(7,136)	(357)	62	(8,223)
Net property income	44,599	(7,136)	5,544	—	43,007
Joint Venture management fee income	21,537	—	—	—	21,537
Net valuation gains/(losses) on investment properties destined to the Joint Ventures ¹	—	(83,874)	—	—	(83,874)
Administration expenses	(6,793)	(21,052)	(1,632)	—	(29,477)
Share of Joint Ventures’ Adjusted profit after tax ²	62,796	—	—	—	62,796
EBITDA	122,139	(112,062)	3,912	—	13,989
Other expenses	—	—	—	—	(3,000)
Depreciation and amortisation	(633)	(2,530)	(1,316)	—	(4,479)
Earnings before interest and tax	121,506	(114,592)	2,596	—	6,510
Net financial cost – Own	—	—	—	—	(27,009)
Net financial cost – Joint Ventures and associates	—	—	—	—	(18,852)
Profit before tax	—	—	—	—	(39,351)
Current income taxes – own	—	—	—	—	(7,590)
Current income taxes – Joint Ventures and associates	—	—	—	—	(4,217)
Recurrent net income	—	—	—	—	(51,158)
Net valuation gains/(losses) on investment properties – other countries ³	—	—	—	—	(13,356)
Net valuation gains/(losses) on investment properties – Joint Ventures and associates	—	—	—	—	(106,118)
Net fair value gain/(loss) on interest rate swaps and other derivatives	—	—	—	—	—
Net fair value gain/(loss) on interest rate swaps and other derivatives – Joint Ventures and associates	—	—	—	—	2,096
Deferred taxes – own	—	—	—	—	27,625
Deferred taxes – Joint Ventures and associates	—	—	—	—	18,369
Reported result for the period	—	—	—	—	(122,542)

¹ The net valuation losses on investment properties destined to the Joint Ventures contains a revaluation loss of € 213.5 million offset by a realized valuation gain on transactions with the Joint Ventures and some first time valuation effects, totalling to € 129.6 million.
² The adjustments to the share of profit from the joint ventures (at share) are composed of € 106.1 million of net valuation losses on investment properties, € 2.1 million of net fair value gain on interest rate derivatives and € 18.4 million of reversal deferred taxes in respect of these adjustments.
³ Relates to developments in countries outside of the JV perimeters i.e. Latvia, Croatia, France, Denmark and Serbia.

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS# FINANCIAL REVIEW 2023 PAGE 335

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

4.2 Geographical information

This basic segmentation reflects the geographical markets in Europe in which VGP operates, VGP’s operations are split into the individual countries where it is active. This segmentation is important for VGP as the nature of the activities and the customers have similar economic characteristics within those segments.

31.12.2023

In thousands of €

	Gross rental and renewable energy income (Incl. JV at share)	Net rent and renewable energy income (Incl. JV at share)	Operating EBITDA (Incl. JV at share)	Investment properties (Incl. JV at share)	Renewables property, plant and equipment	Total assets (Incl. JV at share)	Capital expenditure
Western Europe
Germany	94,050	88,920	116,823	2,429,295	76,817	2,632,744	344,106
Spain	11,207	8,444	8,233	329,102	—	342,664	15,780
Austria	1,674	730	11,699	190,978	—	200,223	47,283
Netherlands	8,418	7,034	16,784	280,989	15,238	310,394	17,778
Italy	2,885	2,077	(77)	91,886	3,797	108,727	12,476
France	—	1,218	7,872	97,333	—	110,501	67,680
Portugal	974	858	(6,996)	54,826	—	66,757	11,080
Denmark	—	(24)	(830)	2,488	—	3,583	2,488
Luxembourg	2	—	—	—	—	168,203	—
Belgium²	—	—	—	—	—	569,770	—
Subtotal Western Europe	119,208	109,257	153,508	3,476,897	95,852	4,513,566	518,671
Central and Eastern Europe
Czech Republic	22,737	21,501	33,022	513,940	2,287	531,634	23,048
Slovakia	6,669	5,834	(5,546)	227,649	—	233,207	20,708
Hungary	8,020	6,772	14,638	227,256	—	237,937	47,248
Romania	9,001	7,469	1,904	208,060	555	238,516	43,089
Croatia	—	(15)	(248)	6,246	—	7,969	144
Subtotal Central and Eastern Europe	46,427	41,561	43,770	1,183,151	2,842	1,249,263	134,237
Baltics and Balkan
Latvia	5,418	6,366	5,359	99,460	—	106,008	9,353
Serbia	23	(250)	(1,130)	67,936	5	72,289	30,599
Subtotal Baltics and Balkan	5,441	6,116	4,229	167,396	5	178,297	39,952
Other³	—	(1,888)	14,357	75	—	2,471	—
Total	171,076	155,046	215,864	4,827,519	98,699	5,943,597	692,859

1 Capital expenditures includes additions and acquisition of investment properties and development land but does not include tenant incentives, letting fees, and capitalised interest. Capital expenditure directly incurred for the own portfolio, amounts to € 662.5 million (of which € 212.4 relates to acquisitions) and amount to € 30.4 million on development properties on behalf of First, Second and Fifth Joint Venture.
2 Balance sheet only
3 Other includes the Group central costs and costs relating to the operational business which are not specifically geographically located

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

31.12.2022

In thousands of €

	Gross rental and renewable energy income (Incl. JV at share)	Net rent and renewable energy income (Incl. JV at share)	Operating EBITDA (Incl. JV at share)	Investment properties (Incl. JV at share)	Renewables property, plant and equipment	Total assets (Incl. JV at share)	Capital expenditure
Western Europe
Germany	68,258	61,276	(60,528)	2,439,013	49,175	2,661,881	464,454
Spain	9,455	7,605	32,252	383,874	—	456,971	39,079
Austria	1,118	964	(12,289)	129,428	—	136,722	54,830
Netherlands	6,320	5,282	(1,044)	297,514	15,285	320,736	13,516
Italy	2,711	1,957	20,621	83,719	703	112,832	18,570
France	—	(72)	(1,074)	21,218	—	22,870	21,437
Portugal	415	565	10,249	48,593	—	52,986	26,018
Luxembourg	2	—	—	—	—	190,145	—
Belgium²	—	—	—	—	—	733,144	—
Subtotal Western Europe	88,277	77,577	(11,813)	3,403,359	65,163	4,688,287	637,904
Central and Eastern Europe
Czech Republic	18,889	17,526	26,356	527,852	73	547,589	54,179
Slovakia	4,630	4,942	(10,048)	214,761	—	225,179	35,279
Hungary	5,117	4,774	4,068	169,393	—	181,031	43,637
Romania	4,590	3,366	(6,151)	165,552	531	190,840	858
Croatia	—	(64)	(94)	5,825	—	6,262	5,796
Subtotal Central and Eastern Europe	33,226	30,544	14,131	1,083,383	604	1,150,901	139,748
Baltics and Balkan
Latvia	2,241	1,014	273	93,530	—	95,973	33,504
Serbia	24	(524)	(1,338)	24,243	—	25,241	46,789
Subtotal Baltics and Balkan	2,265	490	(1,065)	117,773	—	121,214	80,293
Other³	—	(1,477)	12,735	75	—	2,431	—
Total	123,768	107,134	13,988	4,604,590	65,767	5,962,833	857,945

1 Capital expenditures includes additions and acquisition of investment properties and development land but does not include tenant incentives, letting fees, and capitalised interest. Capital expenditure directly incurred for the own portfolio amounts to € 832.6 million (of which € 202.5 related to land acquisition) and amounts to € 25.3 million on development properties on behalf of the First and Second Joint Venture.
2 Balance sheet only
3 Other includes the Group central costs and costs relating to the operational business which are not specifically geographically located

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The table below shows the geographic segmentation, excluding the share in the Joint Ventures.

31.12.2023

In thousands of €

	Gross rental and renewable energy income (Own)	Net rent and renewable energy income (Own)	Investment properties (Own)	Property plant and equipment and Intangible assets (Own)	Total non-current assets (IP¹, PPE and Intangibles)
Western Europe
Germany	38,150	37,638	960,417	77,189	1,037,606
Spain	1,269	146	104,838	214	105,052
Austria	968	113	178,478	71	178,549
Netherlands	1,287	942	47,409	15,290	62,699
Italy	222	72	44,467	3,876	48,343
France	—	1,218	97,333	71	97,404
Portugal	352	322	44,154	54	44,208
Denmark	(24)	—	2,485	224	2,709
Luxembourg	—	—	—	37	37
Belgium²	—	—	—	7,435	7,435
Subtotal Western Europe	42,248	40,427	1,479,581	104,461	1,584,042
Central and Eastern Europe
Czech Republic	5,551	5,202	180,791	2,947	183,738
Slovakia	4,640	4,190	192,067	58	192,125
Hungary	5,398	4,263	191,600	102	191,702
Romania	5,725	4,460	167,120	838	167,958
Croatia	—	(15)	6,246	2	6,248
Subtotal Central and Eastern Europe	21,314	18,100	737,824	3,947	741,771
Baltics and Balkan
Latvia	5,418	6,366	99,460	6	99,466
Serbia	23	(250)	67,936	12	67,948
Subtotal Baltics and Balkan	5,441	6,116	167,396	18	167,414
Other²	—	(1,174)	—	—	—
Total	69,003	63,469	2,384,801	108,426	2,493,227

1 Including investment properties included in assets held for sale for an amount of € 875.8 million
2 Other includes the Group central costs and costs relating to the operational business which are not specifically geographically located

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31.12.2022

In thousands of €

	Gross rental and renewable energy income (Own)	Net rent and renewable energy income (Own)	Investment properties (Own)	Property plant and equipment and Intangible assets (Own)	Total non-current assets (IP¹, PPE and Intangibles)
Western Europe
Germany	30,905	28,353	1,311,996	49,645	1,361,641
Spain	2,675	1,830	215,015	293	215,308
Austria	462	399	115,943	38	115,981
Netherlands	1,921	1,726	144,835	15,356	160,191
Italy	714	360	40,374	791	41,165
France	—	(72)	21,218	8	21,226
Portugal	104	306	37,998	67	38,065
Luxembourg	—	—	—	34	34
Belgium²	—	—	—	6,465	6,465
Subtotal Western Europe	36,781	32,902	1,887,379	72,697	1,960,076
Central and Eastern Europe
Czech Republic	5,234	4,251	242,545	670	243,215
Slovakia	2,552	2,879	178,605	50	178,655
Hungary	2,779	2,547	132,014	114	132,128
Romania	1,619	615	124,102	825	124,927
Croatia	—	(64)	5,825	—	5,825
Subtotal Central and Eastern Europe	12,184	10,228	683,091	1,659	684,750
Baltics and Balkan
Latvia	2,241	1,014	93,530	5	93,535
Serbia	24	(524)	24,243	2	24,245
Subtotal Baltics and Balkan	2,265	490	117,773	7	117,780
Other²	—	(613)	—	117	117
Total	51,230	43,007	2,688,243	74,480	2,762,723

1 Including investment properties included in assets held for sale for an amount of € 292.5 million
2 Other includes the Group central costs and costs relating to the operational business which are not specifically geographically located

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5. Revenue

In thousands of €

	31. 12. 2023	31. 12. 2022
Rental income from investment properties	54,298	35,177
Rent incentives	10,344	10,152
Total gross rental income	64,642	45,329
Gross renewable energy income	4,361	5,901
Property and facility management income	22,513	18,016
Development management income	4,412	3,521
Joint Venture management fee income	26,925	21,537
Service charge income	17,794	12,017
Total revenue	113,722	84,784

The Group leases out its investment property under operating leases. The operating leases are generally for terms of more than 5 years. The gross rental income reflects the full impact of the income generating assets delivered in 2023. During 2023, gross rental income included € 22.8 million of rent for the period related to the property portfolio sold during the tenth closing with the First Joint Venture, the fourth closing with Second Joint Venture and the first closing with the Fifth Joint Venture. At the end of 2023, the Group (including the joint ventures) had annualized committed leases of € 350.8 million¹ compared to € 303.2 million² as at 31 December 2022. The customers represent a healthy mix of logistic tenants and end users. The top 10 tenants (by annualised rent income) are all blue-chip clients. As at 31 December 2023, the top ten tenants take up approximately 32.0% of the total (own and Joint Ventures) Annualised Committed Leases. The breakdown of future lease income for the own portfolio and Joint Ventures at share is as follows:

31. 12. 2023

In thousands of €

	Lease income in < 1 year	Lease income in < 2 years	Lease income in < 3 years	Lease income in < 4 years	Lease income in < 5 years	Lease income > 5 years	Total
JV at share – Active Leases	113,473	107,853	96,697	86,456	74,573	348,475	827,527
JV at share – Committed Leases	321	339	339	339	339	1,722	3,399
Total – JV at share	113,794	108,192	97,036	86,795	74,912	350,197	830,926
Own – Active Leases	82,136	81,071	78,103	62,153	55,232	287,216	645,911
Own – Committed Leases	19,084	39,625	41,227	41,434	42,058	282,090	465,518
Total – Own	101,220	120,696	119,330	103,587	97,290	569,306	1,111,429
Total – at share	215,014	228,888	216,366	190,382	172,202	919,504	1,942,355

31. 12.# NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

6. Net property operating expenses

In thousands of €

	31. 12. 2023	31. 12. 2022
Repairs and maintenance	(796)	(653)
Letting, marketing, legal and professional fees	(766)	(742)
Real estate agents	(1,022)	(1,911)
Service charge income	17,794	12,017
Service charge expenses	(16,890)	(11,891)
Other operating income	6,477	3,505
Other operating expenses	(9,498)	(8,253)
Renewable energy operating expenses	(833)	(295)
Total	(5,534)	(8,223)

7. Net valuation gains/(losses) on investment properties

In thousands of €

	31. 12. 2023	31. 12. 2022
Unrealised valuation gains/(losses) on investment properties	22,399	(180,111)
Unrealised valuation gains/(losses) on disposal group held for sale	6,539	(4,336)
Realised valuation gains/(losses) on disposal of subsidiaries and investment properties	59,020	87,217
Total	87,958	(97,230)

The own property portfolio, excluding development land but including the assets being developed on behalf of the joint ventures, is valued by the valuation expert at 31 December 2023 based on a weighted average yield of 6.22% (compared to 5.29% as at 31 December 2022) applied to the contractual rents increased by the estimated rental value on unlet space. A 0,10% variation of this market rate would give rise to a variation of this portfolio value of € 31.6 million. The realized gain comprises gains on the effectuated transactions in ’23 with the First, Second and Fifth Joint Venture. Please note that the realized gains include a € 23.8 million gain on the Fifth Joint Venture, such gain was recorded in H1 ’23 as unrealized and has been reported as fully realized over the full year ’23 in the table above.

8. Administration expenses

In thousands of €

	31. 12. 2023	31. 12. 2022
Wages and salaries	(26,120)	(14,066)
Audit, legal and other advisors	(7,168)	(6,833)
Other administrative expenses	(9,655)	(8,578)
Depreciation	(5,920)	(4,479)
Total	(48,863)	(33,956)

The administrative costs for the period increased from € 34 million for the period ended 31 December 2022 to € 48.9 million for the period ended 31 December 2023. The increase is mainly due to the increased costs of the long-term incentive plan (LTIP) which is directly proportionally linked to the net asset value growth of the Group. During the year 2022 a reversal of this accrual was booked in an amount of € 4 million, whereas in ’23 an additional € 5.5 million has been expensed, which is a variance of € 9.5 million versus previous year. As at 31 December 2023, the group employed 367.5 full-time equivalents, a decrease of 15.5 FTE versus ’22.

9. Investments in Joint Ventures

9.1 Profit from Joint Ventures

The table below presents a summary Income Statement of the Group’s Joint Ventures with (i) Allianz Real Estate (VGP European Logistics, VGP European Logistics 2, VGP Park München) and the associates; (ii) the joint venture with Roozen Landgoederen Beheer (LPM), (iii) the joint venture with VUSA (Belartza) located in San Sebastian, Spain (iv) the joint venture with Weimer Bau (Siegen) in Germany and (v) the joint venture with Deka, all of which are accounted for using the equity method. VGP European Logistics and VGP European Logistics 2 are incorporated in Luxembourg. VGP European Logistics owns logistics property assets in Germany, the Czech Republic, Slovakia and Hungary. VGP European Logistics 2 owns logistics property assets in Spain, Austria, the Netherlands, Italy and Romania. VGP Park München is incorporated in München (Germany) and owns and develops the VGP park located in München. LPM Joint Venture will develop Logistics Park Moerdijk (“LPM”) together with the Port Authority Moerdijk on a 50:50-basis and has been sold in ’24. The joint venture with Deka contains five parks located in Germany. The joint ventures with Vusa and Grekon contain land to be developed jointly with its partner. VGP NV holds 50% directly in all joint ventures and holds another 5.1% in the subsidiaries of VGP European Logistics holding assets in Germany and specifically 10.1% in the German subsidiary 1 that has been disposed to the First Joint Venture in Q1 ’23.

INCOME STATEMENT in thousand of €

	First Joint Venture (excl. minorities) at 100%	Second Joint Venture at 100%	Third Joint Venture at 100%	Development Joint Ventures at 100%	Fifth Joint Venture at 100%	Joint Ventures at 50%	First Joint Venture Asset Companies minority share
31. 12. 2023
Gross rental income	107,748	48,667	27,729	16	12,996	98,578	3,495
Property Operating expenses	—	—	—	—	—	—	—
underlying property operating expenses	1,969	(2,859)	427	(307)	(457)	(613)	(52)
property management fees	(10,208)	(5,959)	(2,398)	—	(602)	(9,584)	(351)
Net rental income	99,509	39,849	25,758	(291)	11,937	88,381	3,196
Net valuation gains/(losses) on investment properties	(76,864)	(38,137)	(26,064)	(1,669)	27,986	(57,374)	(3,805)
Administration expenses	(2,239)	(867)	(116)	(29)	(292)	(1,772)	(65)
Operating result	20,406	845	(422)	(1,989)	39,631	29,235	(674)
Financial income	114	1,063	153	—	101	715	(203)
Financial expense	(25,743)	(20,199)	(12,210)	(573)	(12,027)	(35,376)	(570)
Net financial result	(25,629)	(19,136)	(12,057)	(573)	(11,926)	(34,661)	(773)
Taxes	(3,579)	3,661	(806)	(1,678)	(5,761)	(4,082)	240
Result For The Period	(8,802)	(14,630)	(13,285)	(4,240)	21,944	(9,508)	(10,715)
Other comprehensive income	—	—	—	—	—	—	—
Total Comprehensive Income/Loss For The Period	(8,802)	(14,630)	(13,285)	(4,240)	21,944	(9,508)	(10,715)
1 VGP Park Berlin
31. 12. 2022
Gross rental income	96,754	34,229	7,533	46	69,281	3,257	72,538
Property Operating expenses	—	—	—	—	—	—	—
underlying property operating expenses	81	(1,680)	10	(14)	(802)	(49)	(851)
property management fees	(8,862)	(4,849)	(766)	—	(7,239)	(321)	(7,560)
Net rental income	87,973	27,700	6,777	32	61,240	2,887	64,127
Net valuation gains/(losses) on investment properties	(126,246)	(92,546)	16,385	5,054	(98,677)	(7,440)	(106,117)
Administration expenses	(1,868)	(502)	(130)	(76)	(1,288)	(45)	(1,333)
Operating result	(40,141)	(65,348)	23,032	5,010	(38,725)	(4,598)	(43,323)
Financial income	2,118	2,313	—	—	2,216	—	2,216
Financial expenses	(21,535)	(11,984)	(2,502)	(408)	(18,215)	(757)	(18,972)
Net financial result	(19,417)	(9,671)	(2,502)	(408)	(15,999)	(757)	(16,756)
Taxes	8,050	19,214	834	(1,529)	13,286	866	14,152
Result For The Period	(51,508)	(55,805)	21,364	3,073	(41,438)	(4,489)	(45,927)
Other comprehensive income	—	—	—	—	—	—	—
Total Comprehensive Income/Loss For The Period	(51,508)	(55,805)	21,364	3,073	(41,438)	(4,489)	(45,927)

9.2 Summarised balance sheet information in respect of Joint Ventures

BALANCE SHEET in thousand of €

	First Joint Venture (excl. minorities) at 100%	Second Joint Venture at 100%	Third Joint Venture at 100%	Development Joint Ventures at 100%	Fifth Joint Venture at 100%	Joint Ventures at 50%	First Joint Venture’s German Companies minority share
31. 12. 2023
Investment properties	2,215,320	916,912	630,859	226,200	742,658	2,365,975	76,743
Other assets	2,196	(997)	3,392	75	(186)	2,238	—
Total non-current assets	2,217,516	915,915	634,251	226,275	742,472	2,368,213	76,743
Trade and other receivables	19,282	13,878	20,870	19,333	27,187	50,275	535
Cash and cash equivalents	46,997	18,078	33,467	4,011	42,813	72,683	1,672
Total current assets	66,280	31,956	54,337	23,344	70,000	122,958	2,207
Total assets	2,283,796	947,871	688,588	249,619	812,472	2,491,171	78,950
Non-current financial debt	948,283	545,534	379,245	144,930	534,980	1,276,486	33,767
Other non-current financial liabilities	512	—	—	—	—	256	—
Other non-current liabilities	7,257	6,236	—	2,971	10,298	13,381	200
Deferred tax liabilities	197,363	39,043	—	583	22,006	129,498	6,127
Total non-current liabilities	1,153,415	590,813	379,245	148,484	567,284	1,419,621	40,094
Current financial debt	27,368	11,355	1,016	—	—	19,869	744
Trade debts and other current liabilities	19,452	10,037	11,600	37,993	25,060	52,071	494
Total current liabilities	46,819	21,392	12,616	37,993	25,060	71,940	1,238
Total liabilities	1,200,234	612,205	391,861	186,477	592,344	1,491,561	41,332
Net assets	1,083,561	335,666	296,727	63,142	220,128	999,610	37,618
# NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
## 9.3 Other non-current receivables
In thousands of €

	31. 12. 2023	31. 12. 2022
Shareholder loans to First Joint Venture	47,619	38,047
Shareholder loans to Second Joint Venture	31,822	32,614
Shareholder loans to Third Joint Venture	158,132	183,526
Shareholder loans to Development Joint Ventures	140,992	79,350
Shareholder loans to Fifth Joint Venture	172,490	—
Shareholder loans to associates (subsidiaries of First Joint Venture)	4,977	16,402
Construction and development loans to subsidiaries of the First Joint Venture	8,482	5,280
Construction and development loans to subsidiaries of the Second Joint Venture	22,786	96,071
Construction and development loans to the Fifth Joint Venture	287,813	—
Construction and development loans reclassified as assets held for sale	(319,081)	(101,351)
Other long term receivables	9,702	9,705
Total	565,734	359,644

The other non-current receivables increased by € 206.1 million. Main changes include financing to the Development Joint Ventures (mainly LPM) of € 61.6 million, as well as a new shareholder loan following the transaction with the Fifth Joint Venture of € 172.5 million. Shareholder loans to the First, Second and Third Joint Venture reduced by € 28 million. This includes the set off between the creation of new shareholder loans following the transactions with the First and Second Joint Venture in the first half of ’23 and € 57 million net distributions through shareholder loans.

9.4 Investments in joint ventures and associates

In thousands of €

	31. 12. 2023	31. 12. 2022
As at 1 January	891,201	858,116
Additions	166,211	116,379
Result of the year	(10,715)	(45,927)
Repayment of equity 1	(3,407)	(14,154)
Dividends 1	(6,062)	(23,214)
Adjustment from sale of participations	—	—
As at the end of the period	1,037,228	891,201

The investments in joint ventures and associates increased by € 146 million. This change is mainly related to (i) equity contributions of transactions with Joint Ventures in an amount of € 166.2 million; (ii) an equity repayment from the Development Joint Venture Siegen of € 3.4 million; (iii) a dividend received from the First Joint Venture for an amount of € 6 million, (iv) as well as the share in the result of the Joint Ventures, a loss of € 10.7 million.

1 On top of the equity distribution and dividends from the joint ventures for an amount of € 9.5 million (in 2022: € 37.4 million), VGP group received a partial repayment of shareholders loan for a total amount of € 72.5 million (in 2022: € 22.6 million). Resulting in a total profit distribution by the Joint Ventures of € 82 million (in 2022: € 60 million).

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9.5 EPRA performance measures on the Joint Ventures at share

This paragraph provides additional performance measures for the Joint Ventures (excluding the Development Joint Ventures), calculated in accordance with the Best Practices Recommendations of the European Public Real Estate Association (EPRA). We assess that the metrics are most accurate when determined on the developed portfolio. Therefore, our Development Joint Ventures, which only contain development land, were not considered in the performance measures below. We provide these measures on the Joint Ventures at share, in particular for the First, Second, Third and Fifth Joint Venture, to aid comparison with other European real estate businesses.

(i) Summary EPRA Metrics of Joint Ventures at share

	31. 12. 2023	31. 12. 2022
EPRA Net Tangible Assets (EPRA NTA)	1,130,627	957,554
EPRA Earnings	43,678	39,530
EPRA Net Initial Yield (NIY)	4.98%	4.52%
EPRA ‘Topped-up’ NIY	5.03%	4.65%
EPRA Vacancy Rate	0.9%	1.0%
EPRA Cost Ratio (including direct vacancy costs)	10.0%	11.7%
EPRA Cost Ratio (excluding direct vacancy costs)	9.8%	11.5%
EPRA Loan to value (LTV) ratio	31.6%	31.3%

(ii) Detailed calculation of EPRA Metrics

EPRA NTA – Joint Ventures at share (in thousands of €)

| | 31. 12. 2023 | 31. 12. 2022 |
| :-------------- | :----------: | :----------: |# FINANCIAL REVIEW 2023

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EPRA Earnings of Joint Ventures at share (in thousands of €)

	31. 12. 2023	31. 12. 2022
Earnings per IFRS income statement	(8,598)	(47,464)
Adjustments to calculate EPRA Earnings, exclude:
Changes in value of investment properties, development properties held for investment and other interests	58,988	108,631
Profits or losses on disposal of investment properties, development properties held for investment and other interests	1,359	14
Profits or losses on sales of trading properties including impairment charges in respect of trading properties.	—	—
Tax on profits or losses on disposals	—	—
Negative goodwill/goodwill impairment	—	—
Changes in fair value of financial instruments and associated close-out costs	1,239	(2,093)
Acquisition costs on share deals and non-controlling joint venture interests	1,972	1,212
Deferred tax in respect of EPRA adjustments	(11,282)	(20,770)
Adjustments (i) to (viii) above in respect of joint ventures (unless already included under proportional consolidation)	—	—
Non-controlling interests in respect of the above	—	—
EPRA Earnings	43,678	39,530

1 First, Second, Third and Fifth Joint Venture (at share) – excluding development Joint Ventures.

EPRA NIY and 'topped-up' NIY of Joint Ventures at share (in thousands of €)

	31. 12. 2023	31. 12. 2022
Investment property – share of Joint Ventures	2,492,104	1,899,055
Trading property	—	—
Less: developments	(183,306)	(81,193)
Completed property portfolio	2,308,798	1,817,861
Allowance for estimated purchasers’ costs	40,529	30,768
Gross up completed property portfolio valuation	2,349,327	1,848,629
Annualised cash passing rental income	116,806	83,359
Property outgoings	160	144
Annualised net rents	116,966	83,503
Add: notional rent expiration of rent free periods or other lease incentives	1,105	2,465
Topped-up net annualised rent	118,071	85,968
EPRA NIY	4.98%	4.52%
EPRA “topped-up” NIY	5.03%	4.65%

EPRA Vacancy Rate of Joint Ventures at share (in thousands of €)

	31. 12. 2023	31. 12. 2022
Estimated Rental Value of vacant space	1,241	867
Estimated rental value of the whole portfolio	132,415	90,1567
EPRA Vacancy Rate	0.9%	1.0%

EPRA Cost Ratios of Joint Ventures at share (in thousands of €)

	31. 12. 2023	31. 12. 2022
Include:
Administrative/operating expense line per IFRS income statement	11,572	8,452
Net service charge costs/fees	307	439
Management fees less actual/estimated profit element	—	—
Other operating income/recharges intended to cover overhead expenses less any related profits	1,678	395
Exclude (if part of the above):
Investment property depreciation	6	2
Ground rent costs	—	—
Service charge costs recovered through rents but not separately invoiced	—	—
EPRA Costs (including direct vacancy costs)	10,195	8,494
Direct vacancy costs	159	144
EPRA Costs (excluding direct vacancy costs)	10,036	8,350
Gross Rental Income less ground rents – per IFRS	102,070	72,519
EPRA Cost Ratio (including direct vacancy costs)	10.0%	11.7%
EPRA Cost Ratio (excluding direct vacancy costs)	9.8%	11.5%

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

EPRA LTV Metric of Joint Ventures at share (in thousands of €)

	31. 12. 2023	31. 12. 2022
Include¹:
Borrowings from Financial Institutions	854,723	638,592
Hybrids (including convertibles, preference shares, debt, options, perpetuals)	—	—
Bond loans	—	—
Foreign currency derivatives (futures, swaps, options and forwards)	(681)	(1,919)
Net payables	5,753	6,661
Owner-occupied property (debt)	—	—
Current accounts (equity characteristic)	—	—
Exclude:
Cash and cash equivalents	(72,355)	(46,619)
Net Debt	787,441	596,716
Include:
Owner-occupied property	38	2
Investment properties at fair value	2,489,307	1,905,968
Properties under development	—	—
Intangibles	3	3
Net receivables	5,204	1,362
Financial assets	—	—
Total Property Value	2,494,551	1,907,335
LTV	31.6%	31.3%

¹ Shareholder loans are excluded from calculation.

10 Net financial result

In thousands of €

	31. 12. 2023	31. 12. 2022
Bank and other interest income	6,488	—
Interest income – loans to Joint Ventures and associates	27,505	17,305
Net foreign exchange gains	73	—
Other financial income	10	24
Financial income	34,076	17,329
Bond interest expense	(47,488)	(52,140)
Bank interest expense – variable debt	(1,971)	(3,708)
Bank interest expense – interest rate swaps – hedging	—	—
Interest	14,960	18,144
Fair value loss on interest rate derivatives	—	—
Net foreign exchange losses	—	(1,426)
Other financial expenses	(5,608)	(5,207)
Financial expenses	(40,107)	(44,337)
Net financial result	(6,031)	(27,008)

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11 Taxation

11.1 Income tax expense recognised in the consolidated income statement

In thousands of €

	31. 12. 2023	31. 12. 2022
Current tax	(15,923)	(7,590)
Deferred tax	(9,528)	27,625
Total	(25,451)	20,035

11.2 Reconciliation of effective tax rate

In thousands of €

	31. 12. 2023	31. 12. 2022
Result before taxes	112,740	(142,577)
Adjustment for share in result of joint ventures and associates	10,715	45,927
Result before taxes and share in result of joint ventures and associates	123,455	(96,650)
Income tax using the German corporate tax rate 15.825%	(19,537)	15,295
Difference in tax rate non-German companies	6,736	14,329
Non-tax-deductible expenditure	(1,578)	(1,253)
Compensation fiscal losses	(9,301)	(6,968)
Other	(1,771)	(1,368)
Total	(25,451)	20,035
	20.6%	20.7%

The majority of the Group’s result before taxes is earned in Germany. Hence the effective corporate tax rate in Germany is applied for the reconciliation.

The expiry of the tax loss carry-forward of the Group can be summarised as follows:

2023

In thousands of €	< 1 year	2–5 years	> 5 years
Tax loss carry forward	92	16,873	85,936

2022

In thousands of €	< 1 year	2–5 years	> 5 years
Tax loss carry forward	1,178	15,299	96,200

11.3 Deferred tax assets and liabilities

In thousands of €

	Assets	Liabilities	Net
	2023	2022	2023
Investment properties	—	—	(57,537)
Currency hedge accounting/Derivates	—	—	(161)
Tax losses carried-forward	3,515	3,026	—
Capitalised interest	—	—	(865)
Capitalised cost	—	—	(79)
Other	732	266	—
Tax assets/liabilities	4,247	3,292	(58,642)
Set-off of assets and liabilities	4,057	547	(4,057)
Reclassification to liabilities related to disposal group held for sale	—	—	38,760
Net tax assets/liabilities	8,304	3,839	(23,939)

A total deferred tax asset of € 16,134k (€ 17,325k in 2022) was not recognised.

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12 Earnings per share

12.1 Earnings per ordinary share (EPS)

In number

	31. 12. 2023	31. 12. 2022
Weighted average number of ordinary shares (basic)	27,291,312	22,311,583
Weighted average number of ordinary shares (diluted)	27,291,312	22,311,583
Weighted average number of ordinary shares (diluted and after correction for reciprocal interest through associates)	27,291,312	22,311,583

In thousands of €

	31. 12. 2023	31. 12. 2022
Result for the period attributable to the Group and to ordinary shareholders	87,292	(122,542)
Earnings per share (in €) – basic	3.20	(5.49)
Earnings per share (in €) – diluted	3.20	(5.49)
Earnings per share (in €) – after dilution and correction for reciprocal interest through associates	3.20	(5.49)

12.2 EPRA NAV’s – EPEA NAV’s per share

The EPRA NAV metrics make adjustments to the IFRS NAV in order to provide stakeholders with the most relevant information on the fair value of the assets and liabilities. The three different EPRA NAV indicators are calculated on the basis of the following scenarios:

1. Net Reinstatement Value: based on the assumption that entities never sell assets and aims to reflect the value needed to build the entity anew. The purpose of this indicator is to reflect what would be required to reconstitute the company through the investment markets based on the current capital and financing structure, including Real Estate Transfer Taxes. EPRA NRV per share refers to the EPRA NRV based on the number of shares in circulation as at the balance sheet date. See www.epra.com.
2. Net Tangible Assets: assumes that entities buy and sell assets, thereby realizing certain levels of deferred taxation. This pertains to the NAV adjusted to include property and other investments at fair value and to exclude certain items that are not expected to be firmly established in a business model with long-term investment properties. EPRA NTA per share refers to the EPRA NTA based on the number of shares in circulation as at the balance sheet date. See www.epra.com.
3. Net Disposal Value: provides the reader with a scenario of the sale of the company’s assets leading to the realization of deferred taxes, financial instruments and certain other adjustments. This NAV should not be considered a liquidation NAV as in many cases the fair value is not equal to the liquidation value. The EPRA NDV per share refers to the EPRA NDV based on the number of shares in circulation as at the balance sheet date. See www.epra.com.# FINANCIAL REVIEW 2023 PAGE 351

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

31 December 2023

	EPRA NRV	EPRA NTA	EPRA NDV	EPRA NAV	EPRA NNNAV	IFRS NAV
In thousands of €
IFRS NAV	2,214,417	2,214,417	2,214,417	2,214,417	2,214,417
IFRS NAV per share (in €)	81.14	81.14	81.14	81.14	81.14
NAV at fair value (after the exercise of options, convertibles and other equity)	2,214,417	2,214,417	2,214,417	2,214,417	2,214,417
To exclude: Deferred tax	54,395	54,395	—	54,395	—
Fair value of financial instruments	—	—	—	—	—
Intangibles as per IFRS balance sheet	—	(1,000)	—	—	—
Subtotal	2,268,812	2,267,812	2,214,417	2,268,812	2,214,417
Fair value of fixed interest rate debt	—	—	327,837	—	327,837
Real estate transfer tax	27,521	—	—	—	—
NAV	2,296,333	2,267,812	2,542,254	2,268,812	2,542,254
Number of shares	27,291,312	27,291,312	27,291,312	27,291,312	27,291,312
NAV/share (in €)	84.14	83.10	93.15	83.13	93.15

31 December 2022

	EPRA NRV	EPRA NTA	EPRA NDV	EPRA NAV	EPRA NNNAV	IFRS NAV
In thousands of €
IFRS NAV	2,202,175	2,202,175	2,202,175	2,202,175	2,202,175
IFRS NAV per share (in €)	80.69	80.69	80.69	80.69	80.69
NAV at fair value (after the exercise of options, convertibles and other equity)	2,202,175	2,202,175	2,202,175	2,202,175	2,202,175
To exclude: Deferred tax	100,927	100,927	—	100,927	—
Fair value of financial instruments	—	—	—	—	—
Intangibles as per IFRS balance sheet	—	(1,200)	—	—	—
Subtotal	2,303,102	2,301,902	2,202,175	2,303,102	2,202,175
Fair value of fixed interest rate debt	—	—	533,612	—	533,612
Real estate transfer tax	87,431	—	—	—	—
NAV	2,390,533	2,301,902	2,735,787	2,303,102	2,735,787
Number of shares	27,291,312	27,291,312	27,291,312	27,291,312	27,291,312
NAV/share (in €)	87.59	84.35	100.24	84.39	100.24

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13 Investment properties and Property, Plant and Equipment

In thousands of €	31. 12. 2023			Total
	Completed	Under Construction	Development land
As at January 1	1,276,093	561,489	558,120	2,395,702
Reclassification from held for sale	117,120	—	1,400	118,520
Capex	131,165	161,478	157,408	450,051
Acquisitions	79,407	49,538	83,489	212,434
Capitalised interest	4	12,125	2,660	14,789
Capitalised rent free and agent’s fee	5,278	2,004	145	7,427
Sales and disposal	(900,957)	(313,100)	(13,064)	(1,227,121)
Transfer on start-up of development	—	135,893	(135,893)	—
Transfer on completion of development	278,610	(278,610)	—	—
Net gain (loss) from value adjustments in investment properties	(17,696)	46,164	7	28,475
Reclassification to held for sale	(448,579)	(20,750)	(21,964)	(491,293)
As at December 31	520,445	356,231	632,308	1,508,984

In thousands of €	31. 12. 2022			Total
	Completed	Under Construction	Development land
As at January 1	562,730	855,160	434,624	1,852,514
Reclassification from held for sale	183,100	160,770	3,735	347,605
Capex	306,291	298,459	25,351	630,101
Acquisitions	41,664	29,309	131,541	202,514
Capitalised interest	9,774	5,560	2,810	18,144
Capitalised rent free and agent’s fee	10,467	2,576	—	13,043
Sales and disposal	(353,665)	—	(3,757)	(357,422)
Transfer on start-up of development	—	40,178	(40,178)	—
Transfer on completion of development	720,060	(720,060)	—	—
Net gain from value adjustments in investment properties	(87,208)	(110,463)	5,394	(192,277)
Reclassification to held for sale	(117,120)	—	(1,400)	(118,520)
As at December 31	1,276,093	561,489	558,120	2,395,702

Any of the Group’s investment property is pledged at 31 December 2023.

13.1 Fair value hierarchy of the Group’s investment properties

All of the Group’s properties are level 3, as defined by IFRS 13, in the fair value hierarchy as at 31 December 2023 and there were no transfers between levels during the year. Level 3 inputs used in valuing the properties are those which are unobservable, as opposed to level 1 (inputs from quoted prices) and level 2 (observable inputs either directly, i.e. as prices, or indirectly, i.e. derived from prices).

13.2 Property valuation techniques and related quantitative information

(i) Valuation process

The Group’s investment property is initially carried at cost plus transaction cost. It is subsequently measured at fair value and is valued at least once per year. In view of the rapid growth of the portfolio the Group has opted to perform the valuations twice per year i.e. as at 30 June and 31 December. Valuations are performed by independent external property appraisers. The Group ordinarily used Jones Lang LaSalle as the Group’s valuator. From time to time, at the discretion of the Company, a small part of the portfolio may be valued by another external independent valuator. For the 31 December 2023 valuations, all valuations were carried out by iO Partners, Jones Lang LaSalle preferred partner. With the exemption of the assets destined for the Fifth and Sixth Joint Venture, classified as held for sale, which are valued at the agreed market value with the Joint Venture partner, net of ancillary cost and gains such as supplementary rent and construction variation orders, remaining rent incentives and transaction fee. As a result, the value of the Group’s assets depends on developments in the local real estate market in each of the Group’s countries of operations and is subject to change. Gains and losses from changes in fair value are recognized in the Group’s income statement as valuation results and are also a component of the Group’s indirect result. The Group’s valuation contracts are typically entered into for a term of one year and the fees of the property experts are fixed for the term of their appointment and are not related to the value of the properties for which a valuation is made. The valuations are prepared in accordance with the RICS Valuation – Professional

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Standards (incorporating the International Valuation Standards) Global edition July 2017 (same approach as for the previous period end valuations). The basis of valuation is the market value of the property, as at the date of valuation, defined by the RICS as: “The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing and where the parties had each acted knowledgea- bly, prudently and without compulsion.”

(ii) Valuation methodology

Discounted cash flow approach

In view of the nature of the portfolio and the bases of valuation iO Partners, Jones Lang LaSalle preferred partner has adopted the income approach, discounted cash flow technique, analysed over a 10- or 15-year period for each property. The cash flow assumes a ten/fifteen-year hold period with the exit value cal- culated on ERV or contracted income. To calculate the exit value iO Partners, Jones Lang LaSalle preferred partner has used the exit yield which represents their assumption of the possible yield in the 10/15 th year. The cash flow is based upon the rents paya- ble under existing lease agreements until the agreed lease end. In case of early break option, the valuator has assumed that the break will be exercised only if the penalty is low. After the lease termination the valuator has assumed a cer- tain expiry void period and a 5 year new lease contract. For currently vacant premises the valuator has assumed a certain initial void period and 5 year lease contract. For the properties that are under construction, the valuator has adopted an ini- tial void starting as of the valuation date. The assumed rental income was calculated on the basis of estimated rental value (ERV). The assumed voids are used to cover the time and the relocated cost of marketing, re-letting and possible recon- struction. The voids were adopted to each of the buildings within the portfolio. In order to calculate the net rental income the valuators have deducted capital expenditures (contribu- tion to the sinking fund) from the gross rental income.

Term & Reversion Valuation Approach

This is the traditional method of valuing investment proper- ties. The market value is derived by capitalising the estimated net income from the property on a term and reversion basis. It involves the capitalisation of the present income over the period of its duration together with the valuation of each subsequent different rent likely to be received following market rent reviews or following re-letting for their separate estimated durations, each discounted to a present value. The yield or yields applied to the different income categories reflect all the prospects and risks attached to the income flow and the investment. The yields are derived from a combination of analysis of completed compa- rable investment transactions and general experience and mar- ket knowledge. The most important yield is the equivalent yield, although regard must be had to the yield profile of the invest- ment over time, particularly the initial yield at the valuation date.

Equivalent yield approach

For the properties in Spain, the valuator has adopted the equivalent yield approach. The equivalent yield approach cal- culates the gross market value by applying a capitalisation rate (equivalent yield) to the net rental income as of the valuation date and capitalising the income into perpetuity. The above- mentioned assumptions are more thoroughly specified in the below section of the valuation assumptions.

Valuation assumptions

The following main assumptions, together with the quanti- tative information included in section “(iv) Quantitative infor- mation about fair value measurements using unobservable inputs”; were made by the valuator.

— iO Partners, Jones Lang LaSalle preferred partner analyses adopts a 10- or 15-years cash flow approach to reflect the initial income and any agreed rent indexation reverting to the estimated rental value after expiry of the current leases.# VGP NV ANNUAL REPORT 2023 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

PAGE 354

For the purpose of the valuation the valuator has assumed that the current tenants will stay in the premises until the agreed lease end. In case of early break option, the valuator has assumed that the break will be exercised only if the penalty is low. — The valuator has assumed that after termination (first possible break) of the current lease contracts new 5-year leases will be signed and the valuator’s ERV will be applied and the rent will be indexed each lease anniversary in line with EU CPI, if not mentioned otherwise in the lease agreements. — The range of used estimated rental values has been detailed in below section “(iv) Quantitative information about fair value measurements using unobservable inputs”. — After the termination of existing leases (first break option) the valuator has adopted an expiry void of 2 –12 months. The assumed voids are used to cover the time and the cost of marketing, re-letting and possible reconstruction. The voids were adopted to each of the building within the portfolio. — For properties that are vacant and under construction, the valuator has adopted an initial void starting at the valuation date. — From the gross income the valuator has deducted a contribution to a sinking fund at 0.25%–8.20%. (for JV, it is however 0.0%–3.0%) — The rents were indexed in line with the indexation that was agreed in the lease agreements. Therefore, the rents are subject to the indexation according to German, Spanish, Italian, Austrian CPI, EU CPI, EICP or HICP. Some of the rents are indexed in line with the fixed indexation and some of the rents are not subject of indexation at all. Please note that several tenants have agreed to the maximum caps in indexation. The EICP indexation was assumed at the level of 6.40% for year 2024 and 1.49% for the following years, prognosis in cashflow. . — The rents after reversion have been indexed on an annual basis each lease anniversary in line with the EU CPI indexation, which is assumed to be at 6.40% for year 2024 and 1.49% for the following years, prognosis in cashflow. — The exit value was calculated on ERV or contracted income – The cash flow that was used for the calculation was discounted either quarterly or monthly depending on the frequency of the rent payments. — Based on the location, projected achievable rental income stream and position in the market the valuator has applied exit yields and discount rates (see below section “(iv) Quantitative information about fair value measurements using unobservable inputs”; for further details). Property that is being constructed or developed for future use as investment property is also stated at fair market value, and investment properties under construction are also valued by an independent valuation expert. For the properties under construction the valuation expert has used the same approach as applicable for the completed properties but deducting the remaining construction costs from the calculated market value, whereby “remaining construction costs” means overall pending development cost, which include all hard costs, soft costs, financing costs and developer profit. Developer profit takes into account the level of risk connected with individual property and is mainly dependent on development stage and pre-letting status. Land held for development is valued using the valuation sales comparison approach. The sales comparison approach produces a value indication by comparing the subject property to similar properties and applying adjustments to reflect advantages and disadvantages to the subject property. This is most appropriate when a number of similar properties have recently been sold or are currently for sale in the market. In June 2020 VGP sold 50% of the shares of VGP Park München GmbH to Allianz Real Estate, thereby losing control over VGP Park München in 2020 (the “Transaction”). The completion of the development of VGP Park München has taken several years. As a result of the loss of control over VGP Park München, VGP has deconsolidated all assets and liabilities of VGP Park München and has recognized a gain on the disposal which has been calculated as the difference between: (i) the carrying value (= equity value) of all assets and liabilities of VGP Park München at the Transaction Date, and (ii) the fair market value of 100% of the shares of VGP Park München (the “Fair Value”). The gain on the Transaction has been recognized in full (100%), consistent with the accounting policies of VGP and IFRS 10 (See note 2.3 – Principles of consolidation – Joint venture and associates – in this section further information). Until the completion of the majority of the buildings such buildings have been measured at their proportional agreed purchase price with Allianz Real Estate, as this was considered to be the best reflection of their fair value. Since December 2022, following the completion of the majority of the buildings in the second half of 2022, such buildings are revalued by an external independent valuation expert in accordance with the Group’s valuation rules (See note 2.7 – Investment properties – in this section further information). With the exemption of the land plot destined for construction of building D, has still been valued at the proportional agreed purchase price with Allianz Real Estate, as this is still considered as the best reflection of the fair value until the building will be completed. In November 2020, VGP entered into a 50:50 joint venture (“LPM Joint Venture”) with Roozen Landgoederen Beheer in respect of the development of the Logistics Park Moerdijk. In February 2024 (refer to note 27 Events after the balance sheet date) the group divested its stake in the LPM Joint Venture. The Board of Directors has therefore concluded that the acquisition cost is the best approximation of the fair value of the development land. In October 2021 VGP entered into a 50:50 joint venture with Vusa. The VGP Park Belartza Joint Venture focuses on the development of a mixed (logistics/commercial) park whereby VGP will lead the logistics development and its joint venture partner (Vusa) will lead the commercial development. The VGP Park Belartza Joint Venture has the right to sell and VGP the right to acquire the logistics income generating assets developed by the VGP Park Belartza Joint Venture. Vusa has the right to acquire the commercial income generating assets developed by the VGP Park Belartza Joint Venture. The land which is currently in ownership of this joint venture is still subject to receiving its final rezoning permits. The Board of Directors has therefore concluded that the acquisition cost is therefore the best approximation of the fair value of the development land. In February 2022 the VGP Park Siegen Joint Venture purchased a brownfield site located in Siegen, Germany. The VGP Park Siegen Joint Venture has the right to sell and VGP the right to acquire the income generating assets developed by the VGP Park Siegen Joint Venture. VGP’s joint venture partner leads the commercial development. In the second half of 2022 part of the brownfield has been sold to a third party. The remainder of the site could be further redeveloped or sold. The Board of Directors has therefore concluded that the acquisition cost is therefore the best approximation of the fair value of the development land.

Valuation review

The valuations made are reviewed internally by the CEO, CFO and Financial Controller and discussed with the independent valuator as appropriate. The CFO and CEO report on the outcome of the valuation processes and results to the audit committee and take any comments or decision in consideration when performing the subsequent valuations. At each semi-annual period end, the financial controller together with the CFO: (i) verify all major inputs to the independent valuation report; (ii) assess property valuation movements when compared to the prior semi-annual and annual period; (iii) holds discussions with the independent valuer.

(iii) Climate risk legislation

The EU is currently producing legislation on the transition to net zero emissions which is likely to include an update to the Minimum Energy Efficiency Standards and also the intention to introduce an operational rating. Whilst the nature of the legislation is not yet clear it could have a potential impact to future asset value. The introduction of mandatory climate related disclosures in the EU (including “Sustainable Finance Disclosure Regulations” (SFDR) and “Corporate Sustainability Reporting Directive” (CSRD) in the EU), including the assessment of physical and transition climate risks, may potentially have an impact on how the market views such risks and incorporates them into the sale and letting of assets. Sustainability and climate risk legislation has an impact on the value of an asset, even if not explicitly recognised. Valuers reflect markets, they do not lead them. Where the valuers recognise the value impacts of sustainability and legislation, they are reflecting their understanding of how market participants include sustainability and legislation requirements in their bids and the impact on market valuations. For further actions being taken by the VGP Group in respect of climate transition and environmental footprint in general we reference is made to the “Corporate Responsibility Report” included in this Annual Report 2023.

(iv) Quantitative information about fair value

The quantitative information in the following tables is taken from the different reports produced by the independent real estate experts. The figures provide the range of values and the weighted average of the assumptions used in the determination of the fair value of investment properties.# FINANCIAL REVIEW 2023

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Region	Segment	Fair Value 31 Dec-23 (€ ’000)	Valuation Technique	Level 3 – Unobservable Inputs Range
Czech Republic	IP	134,283	Discounted cash flow	ERV per m² (in €)	39–65	Discount rate *	6.15%–6.40%
				Exit yield *	6.15%
				Weighted average yield	5.72%
				Cost to completion (in ’000)	0
				Properties valued (aggregate m²)	142,493
				WAULT (until maturity) (in years)	5.75
				WAULT (until first break) (in years)	5.75
Czech Republic	IPUC	17,290	Discounted cash flow	ERV per m² (in €)	63	Discount rate	7.50%
				Exit yield	6.15%
				Weighted average yield	7.55%
				Cost to completion (in ’000)	14,050
				Properties valued (aggregate m²)	29,309
Czech Republic	DL	23,923	Sales comparison	Price per m²
Germany	IP	339,078	Discounted cash flow	ERV per m² (in €)	46–82	Discount rate*	6.80%–8.20%
				Exit yield *	4.95%–5.70%
				Weighted average yield	5.42%
				Cost to completion (in ’000)	916
				Properties valued (aggregate m²)	312,160
				WAULT (until maturity) (in years)	6.29
				WAULT (until first break) (in years)	6.00
Germany	IPUC	89,010	Discounted cash flow	ERV per m² (in €)	74–82	Discount rate	6.05%–7.30%
				Exit yield	4.55%–5.30%
				Weighted average yield	5.16%
				Cost to completion (in ’000)	42,892
				Properties valued (aggregate m²)	87,366
Germany	DL	180,017	Sales comparison	Price per m²
Spain	IPUC	850	Discounted cash flow	ERV per m² (in €)	44	Discount rate	n/a
				Exit yield	6.00%
				Weighted average yield	7.12%
				Cost to completion (in ’000)	3,400
				Properties valued (aggregate m²)	6,905
Spain	DL	86,595	Sales comparison	Price per m²
Romania	IP	104,360	Discounted cash flow	ERV per m² (in €)	52–66	Discount rate	8.25%–9.75%
				Exit yield	8.00%–9.50%
				Weighted average yield	9.06%
				Cost to completion (in ’000)	3,385
				Properties valued (aggregate m²)	169,110
				WAULT (until maturity) (in years)	5.51
				WAULT (until first break) (in years)	4.89
Romania	IPUC	18,460	Discounted cash flow	ERV per m² (in €)	50	Discount rate	9.00%–9.50%
				Exit yield	8.50%–8.75%
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				VGP NV ANNUAL REPORT 2023
				NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
				Weighted average yield	11.10%
				Cost to completion (in ’000)	29,250
				Properties valued (aggregate m²)	86,045
Romania	DL	44,300	Sales comparison	Price per m²
Nederlands	DL	40,545	Sales comparison	Price per m²
Italy	IPUC	6,700	Discounted cash flow	ERV per m² (in €)	85	Discount rate	8.80%
				Exit yield	5.90%
				Weighted average yield	8.13%
				Cost to completion (in ’000)	13,900
				Properties valued (aggregate m²)	18,773
Italy	DL	37,767	Sales comparison	Price per m²
Austria	IP	64,700	Discounted cash flow	ERV per m² (in €)	85–192	Discount rate	6.50%–6.75%
				Exit yield	5.40%–5.50%
				Weighted average yield	5.41%
				Cost to completion (in ’000)	—
				Properties valued (aggregate m²)	22,558
				WAULT (until maturity) (in years)	13.30
				WAULT (until first break) (in years)	13.30
Austria	IPUC	89,400	Discounted cash flow	ERV per m² (in €)	84–99	Discount rate	6.85%–7.00%
				Exit yield	5.35%–5.60%
				Weighted average yield	6.76%
				Cost to completion (in ’000)	39,100
				Properties valued (aggregate m²)	82,685
Austria	DL	24,378	Sales comparison	Price per m²
Hungary	IP	91,072	Discounted cash flow	ERV per m² (in €)	50–70	Discount rate*	7.00%–8.00%
				Exit yield *	6.50%–7.25%
				Weighted average yield	7.42%
				Cost to completion (in ’000)	0
				Properties valued (aggregate m²)	114,270
Hungary	IP	91,072	Discounted cash flow	WAULT (until maturity) (in years)	5.40
				WAULT (until first break) (in years)	5.40
Hungary	IPUC	65,760	Discounted cash flow	ERV per m² (in €)	53–58	Discount rate	7.50%–8.00%
				Exit yield	6.75%–7.25%
				Weighted average yield	7.81%
				Cost to completion (in ’000)	21,800
				Properties valued (aggregate m²)	105,874
Hungary	DL	33,348	Sales comparison	Price per m²
Latvia	IP	97,820	Discounted cash flow	ERV per m² (in €)	56–63	Discount rate	8.00%–8.75%
				Exit yield	8.00–8.25%
				Weighted average yield	7.88%
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				NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
				Cost to completion (in ’000)	950
				Properties valued (aggregate m²)	133,535
				WAULT (until maturity) (in years)	7.48
				WAULT (until first break) (in years)	7.48
Latvia	DL	1,640	Sales comparison	Price per m²
Slovakia	IP	110,296	Discounted cash flow	ERV per m² (in €)	40–74	Discount rate*	n/a
				Exit yield *	n/a
				Weighted average yield	6.17%
				Cost to completion (in ’000)	0
				Properties valued (aggregate m²)	138,209
				WAULT (until maturity) (in years)	7.54
				WAULT (until first break) (in years)	7.36
Slovakia	IPUC	19,910	Discounted cash flow	ERV per m² (in €)	65	Discount rate	7.50%
				Exit yield	7.25%
				Weighted average yield	8.05%
				Cost to completion (in ’000)	1,650
				Properties valued (aggregate m²)	8,480
Slovakia	DL	60,619	Sales comparison	Price per m²
Portugal	IP	27,415	Discounted cash flow	ERV per m² (in €)	66–72	Discount rate	7.81%–7.87%
				Exit yield	5.81%–5.87%
				Weighted average yield	6.09%
				Cost to completion (in ’000)	580
				Properties valued (aggregate m²)	19,749
				WAULT (until maturity) (in years)	20.64
				WAULT (until first break) (in years)	15.49
Portugal	IPUC	5,101	Discounted cash flow	ERV per m² (in €)	51	Discount rate	8.28%
				Exit yield	6.28%
				Weighted average yield	6.97%
				Cost to completion (in ’000)	26,520
				Properties valued (aggregate m²)	31,789
Portugal	DL	11,638	Sales comparison	Price per m²
Serbia	IPUC	44,380	Discounted cash flow	ERV per m² (in €)	61–77	Discount rate	9.25%–9.50%
				Exit yield	8.25%
				Weighted average yield	9.36%
				Cost to completion (in ’000)	17,150
				Properties valued (aggregate m²)	76,938
Serbia	DL	23,556	Sales comparison	Price per m²
Croatia	DL	6,246	Sales comparison	Price per m²
France	IPUC	20,120	Discounted cash flow	ERV per m² (in €)	55	Discount rate	6.45%
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				VGP NV ANNUAL REPORT 2023
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				Exit yield	5.50%
				Weighted average yield	5.30%
				Cost to completion (in ’000)	20,850
				Properties valued (aggregate m²)	39,329
France	DL	77,213	Sales comparison	Price per m²
Denmark	DL	2,487	Sales comparison	Price per m²
Total		2,000,277

¹ IP = completed investment property
IPUC = investment property under construction
DL = development land

¹ This includes the investment property reclassified to held for sale for an amount of € 491,293 (000) (see table note 13).

PAGE 359

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Region	Segment	Fair Value 31 Dec-22 (€ ’000)	Valuation Technique	Level 3 – Unobservable Inputs Range
Czech Republic	IP	202,580	Discounted cash flow	ERV per m² (in €)	38–60	Discount rate	4.75%–6.00%
				Exit yield	4.75%–5.50%
				Weighted average yield	4.94%
				Cost to completion (in ’000)	220
				Properties valued (aggregate m²)	201,762
				WAULT (until maturity) (in years)	7.99
				WAULT (until first break) (in years)	7.60
	DL	37,666	Sales comparison	Price per m² (in €)
Germany	IP	845,250	Discounted cash flow	ERV per m² (in €)	41–144	Discount rate	4.50%–7.00%
				Exit yield	4.00%–5.75%
				Weighted average yield	4.88%
				Cost to completion (in ’000)	38,535
				Properties valued (aggregate m²)	744,066
				WAULT (until maturity) (in years)	9.35
				WAULT (until first break) (in years)	9.18
	IPUC	378,180	Discounted cash flow	ERV per m² (in €)	51–85	Discount rate	5.30%–7.15%
				Exit yield	4.30%–5.40%
				Weighted average yield	4.84%
				Cost to completion (in ’000)	214,720
				Properties valued (aggregate m²)	408,825
	DL	85,318	Sales comparison	Price per m² (in €)
Spain	IP	61,670	Equivalent yield	ERV per m² (in €)	42–64	Equivalent yield	4.95%–5.80%
				Reversionary yield	5.28%–6.19%
				Weighted average yield	5.63%
				Cost to completion (in ’000)	—
				Properties valued (aggregate m²)	77,440
				WAULT (until maturity) (in years)	4.10
				WAULT (until first break) (in years)	3.50
	DL	93,500	Sales comparison	Price per m² (in €)
Romania	IP	27,503	Discounted cash flow	ERV per m² (in €)	49–54	Discount rate	8.70%–9.70%
				Exit yield	8.00%–8.75%
				Weighted average yield	9.52%
				Cost to completion (in ’000)	1,550
				Properties valued (aggregate m²)	55,928
				WAULT (until maturity) (in years)	5.18
				WAULT (until first break) (in years)	5.82
Romania	IPUC	53,110	Discounted cash flow	ERV per m² (in €)	48–66	Discount rate	8.30%–8.95%
				Exit yield	7.50%–8.15%
				Weighted average yield	8.88%
				Cost to completion (in ’000)	5,750
				Properties valued (aggregate m²)	92,743
Romania	DL	43,489	Sales comparison	Price per m² (in €)
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				NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
Netherlands	DL	38,606	Sales comparison	Price per m² (in €)
Italy	IP	8,350	Discounted cash flow	ERV per m² (in €)	88	Discount rate	6.65%
				Exit yield	5.30%
				Weighted average yield	5.88%
				Cost to completion (in ’000)	200
				Properties valued (aggregate m²)	5,710
				WAULT (until maturity) (in years)	8.90
				WAULT (until first break) (in years)	8.90
	DL	32,024	Sales comparison	Price per m² (in €)
Austria		13,400	Discounted cash flow	ERV per m² (in €)	78	Discount rate	6.20%
				Exit yield	4.95%
				Weighted average yield	4.75%
				Cost to completion (in ’000)	20
				Properties valued (aggregate m²)	8,210
				WAULT (until maturity) (in years)	7.81
				WAULT (until first break) (in years)	7.81
	IPUC	37,180	Discounted cash flow	ERV per m² (in €)	196	Discount rate	5.90%
				Exit yield	4.40%
				Weighted average yield	4.65%
				Cost to completion (in ’000)	23,200
				Properties valued (aggregate m²)	14,330
	DL	65,363	Sales comparison	Price per m² (in €)
Hungary	IP	65,150	Discounted cash flow	ERV per m² (in €)	50–66	Discount rate	6.50%–7.50%
				Exit yield	6.00%–6.75%
				Weighted average yield	7.05%
				Properties valued (aggregate m²)	80,350
				WAULT (until maturity) (in years)	6.15
				WAULT (until first break) (in years)	5.49
Hungary	IPUC	32,480	Discounted cash flow	ERV per m² (in €)	50–61	Discount rate	6.50%–7.50%
				Exit yield	6.00%–6.75%
				Weighted average yield	7.06%
				Cost to completion (in
# PAGE 361
# NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Region	Segment	Fair Value 31 Dec-22 (€ ’000)	Valuation Technique	Level 3 – Unobservable Inputs	Range
Latvia	IP	71,420	Discounted cash flow	ERV per m² (in €)	47–61
				Discount rate	7.35%–8.00%
				Exit yield	7.35%–7.50%
				Weighted average yield	7.54%
				Cost to completion (in ’000)	5,750
				Properties valued (aggregate m²)	101,150
	DL	33,205	Sales comparison	Price per m² (in €)
IPUC		20,470	Discounted cash flow	ERV per m² (in €)	58
				Discount rate	7.35%
				Exit yield	7.35%
				Weighted average yield	7.12%
				Cost to completion (in ’000)	3,200
				Properties valued (aggregate m²)	28,816
	DL	1,640	Sales comparison	Price per m² (in €)
Slovakia	IP	97,890	Discounted cash flow	ERV per m² (in €)	40–55
				Discount rate	5.85%–6.25%
				Exit yield	5.85%–6.00%
				Weighted average yield	5.45%
				Cost to completion (in ’000)	—
				Properties valued (aggregate m²)	119,019
				WAULT (until maturity) (in years)	8.51
				WAULT (until first break) (in years)	8.51
	IPUC	16,360	Discounted cash flow	ERV per m² (in €)	49–66
				Discount rate	6.00%–8.00%
				Exit yield	6.00%–6.50%
				Weighted average yield	6.37%
				Cost to completion (in ’000)	6,350
				Properties valued (aggregate m²)	27,642
	DL	63,132	Sales comparison	Price per m² (in €)
Portugal	IPUC	21,740	Discounted cash flow	ERV per m² (in €)	83–99
				Discount rate	7.94%–8.20%
				Exit yield	5.50%
				Weighted average yield	5.78%
				Cost to completion (in ’000)	10,350
				Properties valued (aggregate m²)	19,881
	DL	16,258	Sales comparison	Price per m² (in €)
Serbia	DL	24,243	Sales comparison	Price per m² (in €)
Croatia	DL	5,825	Sales comparison	Price per m² (in €)
France	DL	21,220	Sales comparison	Price per m² (in €)
Total		2,514,222

1
This includes the investment property reclassified to held for sale for an amount of € 118,520 k (see table note 13).

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

(v) Sensitivity of valuations

The sensitivity of the fair value based on changes to the significant non-observable inputs used to determine the fair value of the properties classified in level 3 in accordance with the IFRS fair value hierarchy is as follows (all variables remaining constant):

Non observable input	Impact on fair value in case of
	Fall
ERV (in €/m²)	Negative
Discount rate	Positive
Exit yield	Positive
Remaining lease term (until first break)	Negative
Remaining lease term (until final expiry)	Negative
Occupancy rate	Negative
Inflation	Negative

A decrease in the estimated annual rent will decrease the fair value. An increase in the discount rates and the capitalisation rates used for the terminal value i.e. the exit yield of the discounted cash flow method will decrease the fair value. There are interrela- tionships between these rates as they are partially determined by market rate conditions. For investment properties under con- struction, the cost to completion and the time to complete will reduce the fair values whereas the consumption of such cost over the period to completion will increase the fair value. In addition, the sensitivity of the fair value of the portfolio can be estimated as follows: the effect of a rise (fall) of 1% in rental income results in a rise (fall) in the fair value of the portfolio of approximately € 19.9 million 1 (all variables remaining constant). The effect of a rise (fall) in the weighted average yield (see note 7) of 25 basis points results in a fall (rise) in the fair value of the port- folio of approximately € 77.1 million 1 (all variables remaining constant).

1 Determined on the yield and rental income of the own and held for sale portfolio

13.3 Property Plant and Equipment

In thousands of €	31. 12. 2023	31. 12. 2022
Photovoltaic Equipment – in use	60,533	16,063
Photovoltaic Equipment – under construction	31,330	87,048
Leases capitalized under IFRS 16	13,213	2,280
Other property plant and equipment	2,350	17,882
Total	107,426	73,280

14 Trade and other receivables

In thousands of €	31. 12. 2023	31. 12. 2022
Trade receivables	15,926	16,063
Tax receivables – VAT	58,328	87,048
Accrued income and deferred charges	2,470	2,280
Other receivables	10,142	17,882
Reclassification to (–)/from held for sale	(7,380)	(1,160)
Total	79,486	122,113

The reclassification to held for sale pertains mainly to the assets earmarked for the Fifth and Sixth Joint Venture per 31. 12. 2023.

15 Cash and cash equivalents

The Group’s cash and cash equivalents comprise only cash deposits of which 68% held at Belgian banks.

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16 Share capital and other reserves

16.1 Share capital

	Number of Shares	Par value of Shares (€ 000)
Ordinary Shares issued at 1 January 2023	27,291,312	105,676
issue of new shares	—	—
Ordinary Shares issued at 31 December 2023	27,291,312	105,676

The statutory share capital of the Company amounts to € 136,092 k. The € 30.4 million capital reserve included in the Statement of Changes in Equity, relates to the elimination of the contribution in kind of the shares of a number of Group companies and the deduction of all costs in relation to the issuing of the new shares and the stock exchange listing of the existing shares from the equity of the company, at the time of the initial public offering (“IPO”) in 2007 (see also “Statement of changes in equity”).

16.2 Other Reserves

In thousands of €	31. 12. 2023	31. 12. 2022
As at 1 January	845,579	574,088
Share premium arising on the issue of new shares	—	271,491
As at 31 December	845,579	845,579

As at 31 December 2023, the Group did not hold any treasury shares.

17 Current and non-current financial debts

The contractual maturities of interest-bearing loans and borrowings (current and non-current) are as follows:

MATURITY In thousands of €	31. 12. 2023	Outstanding balance	< 1 year	> 1–5 year	> 5 year
Non-current Bank borrowings	—	—	—	—	—
Schuldschein Loan	25,686	25,686	—	—	—
Bonds 3.35% bonds Mar-25	79,933	79,933	—	—	—
3.50% bonds Mar-26	189,514	189,514	—	—	—
1.50% bonds Apr-29	596,147	—	596,147	—	—
1.625% bonds Jan-27	497,654	497,654	—	—	—
2.25% bonds Jan-30	496,220	—	496,220	—	—
	1,859,468	767,101	1,092,367
Total non-current financial debt	1,885,154	792,787	1,092,367
Current Bank borrowings	—	—	—	—	—
Schuldschein Loan	3,000	3,000	—	—	—
Bonds 3.25% bonds Jul-24	74,939	74,939	—	—	—
Accrued interests	33,811	33,811	—	—	—
Liabilities related to disposal group held for sale	—
Total current financial debt	111,750	111,750	—	—	—
Total current and non-current financial debt	1,996,904	111,750	792,787	1,092,367

PAGE 364

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

The above 31 December 2023 balances include capitalised finance costs of (i) € 314 000 on bank borrowings and schuldschein loans (2022: € 425 000) and (ii) € 10.6 million on bonds (2022: € 13.7 million). The accrued interest relates to the 6 1 issued bonds (€ 33.5 million) and the Schuldschein loans (€ 0.3 million). The coupons of the bonds are payable annually on 6 July for the Jul-24 Bond, 30 March for the Mar-25 Bond, 19 March for the Mar-26, 8 April for the Apr-29 bond and 17 January for bonds Jan-27 & Jan-30. The interest on the Schuldschein loans are paya- ble on a semi-annual basis on 15 April and 15 October for the variable rate Schuldschein loans and annually on 15 October for the fixed rate Schuldschein loans.

MATURITY In thousands of €	31. 12. 2022	Outstanding balance	< 1 year	> 1–5 year	> 5 year
Non-current Bank borrowings	—	—	—	—	—
Schuldschein Loan	28,575	—	28,575	—	—
Bonds 3.25% bonds Jul-24	74,820	—	74,820	—	—
3.35% bonds Mar-25	79,879	—	79,879	—	—
3.50% bonds Mar-26	189,295	—	189,295	—	—
1.50% bonds Ap-r29	595,416	—	595,416	—	—
1.625% bonds Jan-27	496,884	496,884	—	—	—
2.25% bonds Jan-30	495,595	—	495,595	—	—
Total non-current financial debt	1,960,464	—	869,454	1,091,010
Current Bank borrowings	—	—	—	—	—
Schuldschein Loan	—	—	—	—	—
Bonds 2.75% bonds Apr-23	149,897	149,897	—	—	—
3.90% bonds Sep-23	224,534	224,534	—	—	—
Accrued interests	39,273	39,273	—	—	—
Total current financial debt	413,704	413,704	—	—	—
Total current and non-current financial debt	2,374,168	413,704	869,454	1,091,010

17.1 Overview

17.1.1 Bank loans

The loans and credit facilities granted to the VGP Group are all denominated in € can be summarised as follows (all figures below are stated excluding capitalised finance costs):

31. 12. 2023 In thousands of €	Facility amount	Facility expiry date	Outstanding balance	< 1 year	> 1–5 year	> 5 year
KBC Bank NV	75,000	31-dec-26	—	—	—	—
Belfius Bank NV	75,000	31-dec-26	—	—	—	—
Belfius Bank NV	100,000	31-jul-27	—	—	—	—
BNP Parisbas Fortis	50,000	31-dec-26	—	—	—	—
BNP Parisbas Fortis	50,000	31-dec-26	—	—	—	—
JP Morgan SE	50,000	12-dec-25	—	—	—	—
European Investment Bank	150,000	05-feb-34	—	—	—	—
Total bank debt	550,000	—	—	—	—	—

1 The issued bond as per January 10 th 2022 has been considered as two bonds, given their dual tranche maturity as well as different cost.

PAGE 365

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

31. 12. 2022 In thousands of €	Facility amount	Facility expiry date	Outstanding balance	< 1 year	> 1–5 year	> 5 year
KBC Bank NV	75,000	31-dec-26	—	—	—	—
Belfius Bank NV	75,000	31-dec-26	—	—	—	—
Belfius Bank NV	100,000	31-jul-27	—	—	—	—
BNP Paribas Fortis	50,000	31-dec-25	—	—	—	—
BNP Paribas Fortis	50,000	31-dec-26	—	—	—	—
JP Morgan SE	50,000	12-dec-25	—	—	—	—
Total bank debt	400,000	—	—	—	—	—

17.1.2 Schuldschein loans

On 10 October 2019, VGP completed a Schuldscheindarlehen private placement (“Schuldschein loans”) for an aggregate amount of € 33.5 million (excluding capitalised finance costs) which was used to finance the development pipeline of the Group.The Schuldschein loans represents a combination of fixed and floating notes whereby the variable rates represent a nominal amount of € 21 million which is not hedged. The current average interest rate is 3.49 per cent per annum. The loans have a remaining weighted average term of 2.65 years.

1. 1. 2023
      In thousands of €

Facility amount	Facility expiry date	Outstanding balance	< 1 year	> 1–5 year	> 5 year
Schuldschein loans	29,000	Oct -24 to Oct-27	29,000	3,000	26,000

1. 1. 2022
      In thousands of €

Facility amount	Facility expiry date	Outstanding balance	< 1 year	> 1–5 year	> 5 year
Schuldschein loans	29,000	Oct -24 to Oct-27	29,000	—	29,000

17.1.3 Bonds

The following bonds have been repaid in 2023:
— the € 150 million fixed rate bond maturing on 2 April 2023 which carries a coupon of 2.75% per annum (listed on the regulated market of Euronext Brussels with ISIN Code: BE0002677582) (“Apr-23 Bond”)
— € 225 million fixed rate bonds due 21 September 2023 carry a coupon of 3.90% per annum. The bonds have been listed on the regulated market of NYSE Euronext Brussels (ISIN Code: BE0002258276). (“Sep-23 Bond”)

The following five bonds are outstanding at 31 December 2023:
— € 75 million fixed rate bonds due 6 July 2024 which carry a coupon of 3.25% per annum. The bonds have been listed on the regulated market of NYSE Euronext Brussels (ISIN Code: BE0002287564). (“Jul-24 Bond”)
— € 80 million fixed rate bonds due 30 March 2025 carry a coupon of 3.35% per annum. The bonds are not listed (ISIN Code: BE6294349194). (“Mar-25 Bond”)
— € 190 million fixed rate bonds due 19 March 2026 carry a coupon of 3.50% per annum. The bonds have been listed on the regulated market of NYSE Euronext Brussels (ISIN Code: BE0002611896). (“Mar-26 Bond”)
— € 600 million fixed rate bonds due 8 April 2029 carry a coupon of 1.50% per annum. The bonds have been listed on the Luxembourg Stock Exchange (Euro MTF) (ISIN Code: BE6327721237). (“Apr-29 Bond”)
— € 1,000 million fixed rate bonds, dual tranche on five and eight years due 17 January 2027 and 17 January 2030, carry a coupon of 1.625% and 2.25% per annum. The bonds have been listed on the Luxembourg Stock Exchange (Euro MTF) (ISIN Code: BE6332786449 and BE6332787454). (“Jan-27 and Jan-30 Bond”)

17.2 Key terms and covenants

17.2.1 Bank loans

As a general principle, loans are entered into by the Group in € at a floating rate, converting to a fixed rate through interest rate swaps in compliance with the respective loan agreements. For further information on financial instruments we refer to note 23. There are no bank credit facilities outstanding at the level of the subsidiaries as at 31 December 2023. All of the revolving credit facilities, mentioned in note 17.1.1, are unsecured. The interest rate on the credit facilities granted by Belfius Bank SA/NV, KBC Bank NV, JP Morgan SE and BNP Paribas Fortis SA/NV are at floating interest rate plus a margin. All aforementioned revolving credit facilities are subject to the same covenants as the current issued bond except for the Consolidated gearing which is limited to 55% with the possibility of going up to 60% on two test dates (“gearing spike”) provided these two test dates do not follow each other. During the year the Group operated well within its loan covenants and there were no events of default nor were there any breaches of covenants with respect to loan agreements noted.

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17.2.2 Schuldschein loans

The Schuldschein Loans represents a combination of fixed and floating notes whereby the variable rates represent a nominal amount of € 21 million which is not hedged. The Schuldschein loans are unsecured and are subject to the same covenants as the bonds (see note 17.2.3.). During the year the Group operated well within its Schuldschein loan covenants and there were no events of default nor were there any breaches of covenants with respect to Schuldschein loans noted.

17.2.3 Bonds

All bonds are unsecured and at fixed interest rate. The terms and conditions of the bonds include following financial covenants:
— Consolidated gearing to equal or to be below 65%
— Interest cover ratio to equal or to be above 1.2
— Debt service cover ratio to equal or to be above 1.2

The abovementioned ratios are tested semi-annually based on a 12-month period and are calculated as follows:
— Consolidated Gearing means consolidated total Net financial debt divided by the sum of the equity and total liabilities;
— Interest cover ratio means the aggregate net rental income (increased with the available cash and cash equivalents) divided by the Net finance charges;
— Debt service cover ratio means Cash available for debt service divided by Net debt service.

During the year the Group operated well within its bond covenants and there were no events of default nor were there any breaches of covenants with respect to the bonds noted.

17.3 Reconciliation debt movement to cash flows

2023
In thousands of €

	01-Jan-23	Cash Acquisitions/ (divestments)	Non-cash movements Foreign exchange movement	Non-cash movements Fair value changes	Non-cash movements Other	31-Dec-23
Non-current financial debt	1,960,464	—	—	—	—	(75,310)
Other non-current financial liabilities	—	—	—	—	—	—
Current financial debt	413,704	(375,000)	—	—	—	73,046
Non-current financial assets	—	—	—	—	—	—
Total liabilities from financing activities	2,374,168	(375,000)	—	—	—	(2,264)

The cash movements relate to: (i) repayment of bond debt in the amount of € 375 million. The non-cash movements relate to: (i) € 75 million of transfer of Jul-24 bond from non-current financial to current financial debt and € 3 million transfer for the short-term part of the Schuldschein loan (ii) € 5,5 million relating to decrease in accrued interests on bonds and schuldschein loans; and (iii) € 3.2 million relating to amortisation of capitalised finance costs.

2022
In thousands of €

	01-Jan-22	Cash Acquisitions/ (divestments)	Non-cash movements Foreign exchange movement	Non-cash movements Fair value changes	Non-cash movements Other	31-Dec-22
Non-current financial debt	1,340,609	990,749	—	—	—	(370,894)
Other non-current financial liabilities	—	—	—	—	—	—
Current financial debt	44,147	(23,500)	—	—	—	393,057
Non-current financial assets	—	—	—	—	—	—
Total liabilities from financing activities	1,384,756	967,249	—	—	—	22,163

FINANCIAL REVIEW 2023
PAGE 367
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

18 Other non-current liabilities

In thousands of €

	31. 12. 2023	31. 12. 2022
Deposits	4,517	8,252
Retentions	9,330	19,057
Other non-current liabilities	27,535	20,772
Reclassification to liabilities related to disposal group held for sale	(3,297)	(1,662)
Total	38,085	46,419

The other non-current liabilities decreased by € 8.3 million which is the result of (i) a decrease in deposits received from tenants (-€ 3.7 million) and (ii) long-term retentions (-€ 9.7 million). Last year the deposits and retentions were mainly in companies which are sold in 2023 to the Fifth Joint Venture. The increase in other non-current liabilities is mainly the result of a higher provision for LTIP.

19 Trade debt and other current liabilities

In thousands of €

	31. 12. 2023	31. 12. 2022
Trade payables	67,023	98,079
Deposits	—	—
Retentions	1,491	4,945
Accrued expenses and deferred income	5,189	3,330
Other payables	21,599	10,507
Reclassification to liabilities related to disposal group held for sale	(11,227)	(6,185)
Total	84,075	110,676

The trade debts and other current liabilities lowered by € 26 million. The trade payables decreased by € 31 million. Other payables increased to € 21.6 million and relates mainly to VAT payables, short-term leasing obligations (mainly in Renewable Energy) and obligations for wages.

20 Assets classified as held for sale and liabilities associated with those assets

In thousands of €

	31. 12. 2023	31. 12. 2022
Intangible assets	—	—
Investment properties	875,817	292,541
Property, plant and equipment	—	—
Deferred tax assets	—	—
Trade and other receivables	7,380	1,160
Cash and cash equivalents	9,424	6,205
Disposal group held for sale	892,621	299,906
Non-current financial debt	—	—
Other non-current financial liabilities	—	—
Other non-current liabilities	(3,297)	(1,662)
Deferred tax liabilities	(38,760)	(25,095)
Current financial debt	—	—
Trade debts and other current liabilities	(11,227)	(6,187)
Liabilities associated with assets classified as held for sale	(53,284)	(32,944)
Total net assets	839,337	266,962

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

In order to sustain its growth over the medium term, VGP entered into three 50/50 joint ventures with Allianz (First, Second and the recently terminated Fourth Joint Venture) in respect of acquiring income generating assets developed by VGP. These Joint Ventures act as an exclusive take-out vehicle of the income generating assets, allowing VGP to partially recycle its initially invested capital when completed projects are acquired by the Joint Ventures. VGP is then able to reinvest the proceeds in the continued expansion of its development pipeline, including the further expansion of its land bank, allowing VGP to concentrate on its core development activities. Each of these joint ventures have an exclusive right of first refusal in relation to acquiring the following income generating assets of the Group: (i) for the First Joint Venture: the assets located in the Czech Republic, Germany, Hungary and the Slovak Republic; and (ii) for the Second Joint Venture: the assets located in Austria, Italy, the Benelux, Portugal, Romania and Spain.The development pipeline which will be transferred as part of any future acquisition transaction between the Joint Venture and VGP is being developed at VGP’s own risk and subsequently acquired and paid for by these joint ventures subject to pre-agreed completion and lease parameters. The investment properties which are being developed by VGP on behalf of the First and Second Joint Venture have a total net asset value of € 35.9 million. The Fourth Joint Venture was due to become effective at the moment of its first closing, which was initially expected to occur in November 2022. However, in view of the limited transparency on pricing of the seed portfolio in the current volatile market environment, Allianz decided not to proceed with the first initial pipeline portfolio closing of the Fourth Joint Venture. To this end Allianz formally waived the exclusivity obligation in respect of the initial pipeline portfolio allowing VGP to sell the initial pipeline portfolio to one or multiple third parties, including through the establishment of a new alternative joint venture(s). As no further transaction with the Fourth Joint Venture were envisaged on the short to midterm, the Joint Venture has been terminated. As per 21 July 2023, VGP entered into a new Joint Venture agreement (the Fifth Joint Venture) with Deka of which a first closing took place in August ’23. The remaining assets have been classified as held for sale and these assets have been recognized at the agreed fair market value with the Joint Venture partner net of ancillary cost and gains such as supplementary rent and construction variation orders, remaining rent incentives and transaction fees. The total net assets pertaining to the Fifth Joint Venture amount to € 338.1 million. As per 15 December 2023 VGP entered into a new Joint Venture agreement with AREIM Pan-European Logistics Fund (D) AB, or Areim, on a 50:50 basis, with the purpose of investing into VGP developed assets in Germany, Czech Republic, France, Slovakia and Hungary. The venture will utilize debt up to a loan-to-value of 35%. The investor, Areim, has committed a € 500 million equity investment. The investment period lasts until 15 December 2028, with possibilities to extend the Joint Venture by mutual agreement. A seed portfolio has been identified and has been classified as held for sale and these assets have been recognized at the agreed fair market value with the Joint Venture partner net of ancillary cost and gains such as supplementary rent and construction variation orders and remaining rent incentives. The total net assets pertaining to the Sixth Joint Venture amount to € 465 million.

21 Cash flow statement

In thousands of €	31. 12. 2023	31. 12. 2022
Cash flow from operating activities	(27,331)	(70,637)
Cash flow from investing activities	(8,078)	(566,150)
Cash flow from financing activities	(450,050)	1,116,401
Net increase/(decrease) in cash and cash equivalents	(485,459)	479,614

The changes in the cash flow from investing activities was mainly due to: (i) € 667 million (2022: € 851.8 million) of expenditure incurred for the development activities and land acquisition; (ii) € 676.2 million cash recycled resulting from the fourth closing with the Second Joint Venture (€ 194.4 million), the tenth closing with the First Joint Venture (€ 73.5 million); the first closing with the Fifth Joint Venture (€ 393 million) and some final settlements of previous closings (€ 15.5 million). The changes in the cash flow from financing activities were driven by: (i) € 75 million dividend paid out in May 2023 (2022: € 150 million); (ii) € 375 million repayment from the Apr-23 and Sep-23 Bonds.

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22 Cash flow from disposal of subsidiaries and investment properties

In thousands of €	31. 12. 2023	Second JV	First JV	Fifth JV	Third JV	Other	Investment property
Investment property		1,034,382	252,672	117,331	664,379	—	—
Trade and other receivables		46,404	3,678	1,003	41,723	—	—
Cash and cash equivalents		71,515	2,255	7,270	61,990	—	—
Non-current financial debt		—	—	—	—	—	—
Shareholder debt		(755,586)	(167,525)	(75,080)	(512,981)	—	—
Other non-current financial liabilities		(14,933)	(1,244)	(1,668)	(12,021)	—	—
Deferred tax liabilities		(56,057)	(20,430)	(7,210)	(28,417)	—	—
Trade debts and other current liabilities		(62,363)	(2,309)	(6,215)	(53,839)	—	—
Total net assets disposed		263,362	67,097	35,431	160,834	—	—
Realized valuation gain on sale		59,021	18,557	9,928	30,776	—	(240)
Total non-controlling interest retained by VGP		(1,027)	—	(1,027)	—	—	—
Additional share price due at completion of buildings		7,025	—	—	—	7,025	—
Shareholder loans repaid at closing		584,407	154,834	67,083	362,490	—	—
Equity contribution		(165,028)	(43,831)	(22,105)	(99,092)	—	—
Total consideration		747,760	196,657	89,310	455,008	7,025	(240)
Consideration to be received		—	—	—	—	—	—
Consideration paid in cash		747,760	196,657	89,310	455,008	7,025	(240)
Cash disposed		(71,515)	(2,255)	(7,270)	(61,990)	—	—
Net cash inflow from divestment of subsidiaries and investment properties		676,245	194,402	82,040	393,018	7,025	(240)

In thousands of €	31. 12. 2022	Second JV	First JV	Fifth JV	Third JV	Other	Investment property
Investment property		369,657	294,209	75,448	—	—	—
Trade and other receivables		16,019	16,019	—	—	—	—
Cash and cash equivalents		18,086	18,086	—	—	—	—
Non-current financial debt		—	—	—	—	—	—
Shareholder Debt		(191,009)	(191,009)	—	—	—	—
Other non-current financial liabilities		(2,458)	(2,458)	—	—	—	—
Deferred tax liabilities		(76,675)	(25,898)	(50,777)	—	—	—
Trade debts and other current liabilities		(13,511)	(13,511)	—	—	—	—
Total net assets disposed		120,109	95,438	24,671	—	—	—
Realized valuation gain on sale		87,612	49,015	11,321	—	27,163	113
Total non-controlling interest retained by VGP		(227)	—	(227)	—	—	—
Additional share price due at completion of buildings		63,689	—	—	—	63,689	—
Shareholder loans repaid at closing		205,491	168,562	36,929	—	—	—
Equity contribution		(104,190)	(72,727)	(17,882)	—	(13,581)	—
Total consideration		372,484	240,288	54,812	—	77,271	113
Consideration to be received		(7,026)	—	—	—	(7,026)	—
Consideration paid in cash		365,458	240,288	54,812	—	70,245	113
Cash disposed		(18,086)	(18,086)	—	—	—	—
Net cash inflow from divestment of subsidiaries and investment properties		347,372	222,202	54,812	—	70,245	113

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

23 Financial risk management and financial derivatives

23.1 Terms, conditions and risk management

Exposures to foreign currency, interest rate, liquidity and credit risk arise in the normal course of business of VGP. The company analyses and reviews each of these risks and defines strategies to manage the economic impact on the company’s performance. The results of these risk assessments and proposed risk strategies are reviewed and approved by the Board of Directors on regular basis. Some of the risk management strategies include the use of derivative financial instruments which mainly consists of forward exchange contracts and interest rate swaps. The company holds no derivative instruments nor would it issue any for speculative purposes. As at 31 December 2023 there were no derivative financial instruments outstanding (same as for 31 December 2022).

23.2 Foreign currency risk

VGP incurs principally foreign currency risk on its capital expenditure as well as some of its borrowings and net interest expense/ income. VGP’s policy is to economically hedge its capital expenditure as soon as a firm commitment arises, to the extent that the cost to hedge outweighs the benefit and in the absence of special features which require a different view to be taken. The table below summarises the Group’s main net foreign currency positions at the reporting date. Since the Group has elected not to apply hedge accounting, the following table does not include the forecasted transactions. However, the derivatives the Group has entered into, to economically hedge the forecasted transactions are included. As at 31 December 2023 there were no foreign currency derivatives outstanding (same as for 2022).

In thousands	2023	CZK	DKK	HUF	RON	RSD
Trade & other receivables		43,113	779	1,058,564	142,382	430,545
Non-current liabilities and trade & other		(135,417)	(84)	(698,801)	(37,318)	(640,549)
Gross balance sheet exposure		(92,303)	695	359,764	105,064	(210,004)
Forward foreign exchange		—	—	—	—	—
Net exposure		(92,303)	695	359,764	105,064	(210,004)

In thousands	2022	CZK	HUF	RON	RSD
Trade & other receivables		32,461	1,933,338	110,221	10,212
Non-current liabilities and trade & other		(244,235)	(2,484,759)	(37,078)	(6,744)
Gross balance sheet exposure		(211,774)	(551,421)	73,144	3,467
Forward foreign exchange		—	—	—	—
Net exposure		(211,774)	(551,421)	73,144	3,467

The following significant exchange rates applied during the year:

	31. 12. 2023	31. 12. 2022
Closing rate	Closing rate	Closing rate
CZK	24.72500	24.11500
DKK	7.45564	—
HUF	382.80000	400.87000
RON	4.97460	4.94740
RSD	117.17370	117.32240

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Sensitivity

A 10 % strengthening of the euro against the following currencies at 31 December 2023 would have increased/(decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all variables, in particular interest rates, remain constant. The analysis is performed on the same basis for 2022.

Effects	2023	Equity	Profit or (Loss)
	CZK	—	339
	DKK	—	(8)
	HUF	—	(85)
	RON	—	(1,920)
	RSD	—	163
Total		—	(1,512)

Effects	2022	Equity	Profit or (Loss)
	CZK	—	798
	HUF	—	125
	RON	—	(1,344)
	RSD	—	(3)
Total		—	(423)

A 10 % weakening of the euro against the above currencies at 31 December 2023 would have had the equal but opposite effect on the above currencies to amounts shown above, on the basis that all other variables remain constant.PAGE 372
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23.3 Interest rate risk

The Group applies a dynamic interest rate hedging approach whereby the target mix between fixed and floating rate debt is reviewed periodically. These reviews are carried out within the confines of the existing loan agreements should such loan agreements require that interest rate exposure is to be hedged when certain conditions are met. Where possible the Group will apply IFRS 9 to reduce income volatility whereby some of the interest rate swaps may be classified as cash flow hedges. Changes in the value of a hedging instrument that qualifies as highly effective cash flow hedges are recognised directly in shareholders’ equity (hedging reserve). The Group also uses interest rate swaps that do not satisfy the hedge accounting criteria under IFRS 9 but provide effective economic hedges. Changes in fair value of such interest rate swaps are recognised immediately in the income statement. (Interest rate swaps held for trading).

At the reporting date the Group interest rate profile of the Group’s (net of any capitalised financing costs) was as follows:

In thousands of €	31. 12. 2023	31. 12. 2022
Financial debt
Fixed rate
Schuldschein Loan	8,000	8,000
Bonds	1,945,000	2,320,000
Variable rate
Bank debt	—	—
Schuldschein Loan	21,000	21,000
Reclassified to liabilities related to disposal group held for sale	—	—
Interest rate hedging
Interest rate swaps
Held for trading	—	—
Reclassified to liabilities related to disposal group held for sale	—	—
Financial debt after hedging
Variable rate
Bank debt	—	—
Schuldschein Loan	21,000	21,000
Total variable debt (A)	21,000	21,000
Fixed rate
Bonds	1,945,000	2,320,000
Bank debt	—	—
Schuldschein Loan	8,000	8,000
Total fixed rate debt (B)	1,953,000	2,328,000
Total financial debt (C) = (A) + (B)	1,974,000	2,349,000
Fixed rate/total financial liabilities	98.9%	99.1%

The effective interest rate on financial debt (bank debt, schuldschein loans and bonds), including all bank margins on the outstanding financial debt amount 2.11 % for the year-ended 2023 (2.31 % in 2022).

Sensitivity analysis for change in interest rates or profit

In case of an increase/decrease of 100 basis points in the interest rates, profit before taxes would have been € 210 k lower/higher (2022: € 210k). This impact comes from a change in the floating rate debt, with all variables held constant.

Sensitivity analysis for changes in interest rate of other comprehensive income

For 2023 there is no impact given the fact that there are no interest rate swaps outstanding classified as cash flow hedges as at the reporting date. The same situation applied at the 31 December 2022 reporting date.

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23.4 Credit risk

Credit risk is the risk of financial loss to VGP if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from VGP’s receivables from customers and bank deposits. The management has a credit policy in place and the exposure to credit risk is monitored on an on-going basis. Each new tenant is analysed individually for creditworthiness before VGP offers a lease agreement. In addition, the Group applies a strict policy of rent guarantee whereby, in general, each tenant is required to provide a rent guarantee for 6 months. This period will vary in function of the creditworthiness of the tenant. For the credit risk in respect of other non-current receivables please refer to the section “Risk Factors” in this annual report. At the balance sheet date there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the carrying amount of each financial asset.

The maximum exposure to credit risk at the reporting date was:

In thousands of €	31. 12. 2023 (Carrying amount)	31. 12. 2022 (Carrying amount)
Other non–current receivables	565,734	359,644
Trade & other receivables	26,068	33,945
Cash and cash equivalents	219,345	705,373
Reclassification to (–)/from held for sale	(10,812)	(6,774)
Total	800,335	1,092,188

As at 31 December 2023 there was € 1.6 million of restricted cash held in a bank account (2022: € 5.3 million). The group’s cash and cash equivalents comprise primarily cash deposits of which 68% held at Belgian Banks (See note 15).

The aging of trade receivables as at the reporting date was:

In thousands of €	31. 12. 2023 (Carrying amount)	31. 12. 2022 (Carrying amount)
Gross trade receivables
Gross trade receivables not past due	14,826	15,371
Gross trade receivables past due	1,305	692
of which bad debt and doubtful receivables	205	—
Provision for impairment of receivables (–)	(205)	—
Total	15,926	16,063

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23.5 Liquidity risk

Liquidity risk is the risk that the Group will be unable to meet its obligations as they come due because of an inability to liquidate assets or obtain adequate funding. The company manages its liquidity risk by ensuring that it has sufficient cash available and that it has sufficient available credit facilities and by matching as much as possible its receipts and payments. As at 31 December 2023 the Group, in addition to its available cash, has several committed credit lines at its disposal up to a maximum equivalent of € 550 million (2022: € 400 million) at floating interest rates with fixed margins.

The following are contractual maturities of financial assets and liabilities, including interest payments. The amounts disclosed in the tables below are the contractual undiscounted cash flows. Undiscounted cash flows in respect of balances due within 12 months generally equal their carrying amounts in the statement of financial position, as the impact of discounting is not significant.

In thousands of €	2023
Carrying amount	Contractual Cash flow	< 1 year	1–2 years	2–5 years	More than 5 years
Assets
Cash and cash equivalents	219,345	219,345	219,345	—	—
Derivate financial instruments	—	—	—	—	—
Trade and other receivables	26,068	26,068	26,068
Other non-current receivables	565,734	565,734	—	150,694	242,550
Reclassified to (–) from held for sale	(10,812)	(10,812)	(10,812)	—	—
Total	800,335	800,335	234,601	150,694	242,550
Liabilities
Secured bank loans	—	—	—	—	—
Unsecured Schuldschein loans	28,686	31,388	3,833	748	26,807
Unsecured bonds	1,934,407	2,137,998	115,143	117,705	773,650
Derivative financial instruments	—	—	—	—	—
Trade and other payables	131,496	120,265	78,883	19,892	13,186
Reclassification to liabilites related to disposal group held for sale	(13,461)	(13,461)	(10,165)	(1,444)	(1,379)
Total	2,081,128	2,276,189	187,693	136,902	812,264

In thousands of €	2022
Carrying amount	Contractual Cash flow	< 1 year	1–2 years	2–5 years	More than 5 years
Assets
Cash and cash equivalents	705,373	705,373	705,373	—	—
Derivate financial instruments	—	—	—	—	—
Trade and other receivables	33,945	33,945	33,945
Other non-current receivables	359,644	359,644	—	—	359,644
Reclassified to (–)from held for sale	(6,774)	(6,774)	(6,774)
Total	1,092,188	1,092,188	732,544	—	359,644
Liabilities
Secured bank loans	—	—	—	—	—
Unsecured Schuldschein loans	28,575	32,218	830	3,833	27,555
Unsecured bonds	2,306,320	2,566,040	428,043	115,143	871,105
Derivative financial instruments	—	—	—	—	—
Trade and other payables	161,614	157,243	109,263	24,680	13,885
Reclassification to liabilities related to disposal group held for sale	(7,593)	(7,593)	(5,967)	(60)	(1,346)
Total	2,488,916	2,747,908	532,168	143,595	911,199

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23.6 Capital management

VGP is continuously optimising its capital structure targeting to maximise shareholder value while keeping the desired flexibility to support its growth. The Group operates within and applies a maximum gearing ratio of net debt/total shareholders’ equity and liabilities at 65%.

As at 31 December 2023 the Group’s gearing was as follows:

In thousands of €	31. 12. 2023	31. 12. 2022
Non-current financial debt	1,885,154	1,960,464
Other non-current financial liabilities	—	—
Current financial debt	111,750	413,704
Financial debt classified under liabilities related to disposal group held for sale	—	—
Total financial debt	1,996,904	2,374,168
Cash and cash equivalents	(209,921)	(699,168)
Cash and cash equivalents classified as disposal group held for sale	(9,424)	(6,205)
Total net financial debt (A)	1,777,559	1,668,795
Total shareholders’ equity and liabilities (B)	4,410,704	4,846,053
Gearing ratio ((A)/(B))	40.3%	34.4%

23.7 Fair value

The following tables list the different classes of financial assets and financial liabilities with their carrying amounts in the balance sheet and their respective fair value and analyzed by their measurement category under IFRS 9. Abbreviations used in accordance with IFRS 9 are:

• AC Financial assets or financial liabilities measured at amortised cost
• FVTPL Financial assets measured at fair value through profit or loss

• HFT Financial liabilities Held for Trading

• 12.# NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

31. 12. 2023

In thousands of €

Category in accordance with IFRS 9	Carrying amount	Fair value	Fair value hierarchy
Assets
Other non-current receivables AC	565,734	565,734	Level 2
Trade receivables AC	15,926	15,926	Level 2
Other receivables AC	10,142	10,142	Level 2
Derivative financial assets FVTPL	—	—	Level 2
Cash and cash equivalents AC	217,753	217,753	Level 2
Reclassification to (–) from held for sale	(10,812)	(10,812)
Total	798,743	798,743
Liabilities
Financial debt
Bank debt AC	28,686	28,686	Level 2
Bonds AC	1,934,407	1,629,160	Level 1
Trade payables AC	67,023	67,023	Level 2
Other liabilities AC	64,472	64,472	Level 2
Derivative financial liabilities HFT	—	—	Level 2
Reclassification to liabilities related to disposal group held for sale	(13,460)	(13,460)
Total	2,081,128	1,775,881

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

31. 12. 2022

In thousands of €

Category in accordance with IFRS 9	Carrying amount	Fair value	Fair value hierarchy
Assets
Other non-current receivables AC	359,644	359,644	Level 2
Trade receivables AC	16,063	16,063	Level 2
Other receivables AC	17,881	17,881	Level 2
Derivative financial assets FVTPL	—	—	Level 2
Cash and cash equivalents AC	700,066	700,066	Level 2
Reclassification to (–) from held for sale	(6,774)	(6,774)
Total	1,086,880	1,086,880
Liabilities
Financial debt
Bank debt AC	28,575	28,575	Level 2
Bonds AC	2,306,320	1,797,451	Level 1
Trade payables AC	98,079	98,079	Level 2
Other liabilities AC	63,532	63,532	Level 2
Derivative financial liabilities HFT	—	—	Level 2
Reclassification to liabilities related to disposal group held for sale	(7,594)	(7,594)
Total	2,488,912	1,980,044

The following methods and assumptions were used to estimate the fair values:

• Cash and cash equivalents and trade and other receivables, primarily have short terms to maturity; hence, their carrying amounts at the reporting date approximate the fair values;
• The Other non-current receivables are evaluated by the Group based on parameters such as interest rates, individual creditworthiness of the counterparty and the risk characteristics of the financed project. As at 31 December 2023, the carrying amounts of these receivables, are assumed not to be materially different from their calculated fair values.
• Trade and other payables also generally have short times to maturity and, hence, their carrying amounts also approximate their fair values.
• The fair value of financial instruments is determined based on quoted prices in active markets. When quoted prices in active markets are not available, valuation techniques are used. Valuation techniques make maximum use of market inputs but are affected by the assumptions used, including discount rates and estimates of future cash flows. Such techniques include amongst others market prices of comparable investments and discounted cash flows. The principal methods and assumptions used by VGP in determining the fair value of financial instruments are obtained from active markets or determined using, as appropriate, discounted cash flow models and option pricing models. The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
  • Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
  • Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.
  • Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.

During the reporting period ending 31 December 2023, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into and out of Level 3 fair value measurements.

24 Personnel

Long-term incentive plan (“LTIP”) for VGP team

The board of directors has set up a long-term incentive plan. The LTIP allocates profit sharing units (“Units”) to the respective VGP team members (the other members of the Executive Management Team and designated senior managers). One Unit represents an amount equal to the net asset value of VGP divided by the total amount of issued VGP shares. After an initial lock-up period of 5 years (from the respective award date), each participant may return the Units against cash payment of the proportional net asset value growth of such Units. This LTIP is therefore directly and solely based on the net asset value growth of the Group and has no direct nor indirect link to the evolution of the share price of the VGP shares. At any single point in time, the number of Units outstanding (i.e. awarded and not yet vested) cannot exceed 5% of the total amount of shares issued by the Company. During the financial year 2023 there were 787,987 Units allocated to the VGP team and 134,332 Units were vested. The total pay-out of the 134,332 units amounts to € 6.1 million, which has been paid for € 1.4 million in 2023. The remainder is expected to be paid out in 2024. Consequently, the total aggregate Units allocated as at 31 December 2023 (after vesting) amount to 1,364,566 Units. Based on the 31 December 2023 financial figures these Units represent an aggregate net asset value of € 22.3 million (2022: € 18.1 million) which was provided for in the 2023 accounts. (see Remuneration Report for further details).

FINANCIAL REVIEW 2023

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

25 Contingencies and commitments

In thousands of €

	31. 12. 2023	31. 12. 2022
Contingent liabilities	40,950	6,230
Commitments to purchase land	58,270	149,266
Commitments to develop new projects	296,513	370,629

Contingent liabilities mainly relate to bank guarantees linked to land plots and built out of infrastructure on development land. The commitment to purchase land relates to contracts concerning the future purchase of 795,000 m² of land for which deposits totalling € 2.9 million have been made. The down payment on land was classified under investment properties as at 31 December 2023 (same classification treatment applied for 2022) and is mainly composed of € 2.2 million for the acquisition of a land plot located in Vejle, Denmark. It is expected that 30.2 million of the commitments to purchase land and € 284.3 million of the commitments to develop new projects will be payable in ’24.

26 Related parties

Unless otherwise mentioned below, the settlement of related party transactions occurs in cash, there are no other outstanding balances which require disclosure, the outstanding balances are not subject to any interest unless specified below, no guarantees or collaterals provided and no provisions or expenses for doubtful debtors were recorded.

26.1 Shareholders

Shareholding

As at 31 December 2023 the main shareholders of the company are:

• Little Rock S.à.r.l. (29.65%): a company controlled by Mr. Jan Van Geet;
• Tomanvi SCA (2.31%): a company controlled by Mr. Jan Van Geet;
• VM Invest NV (19.00%): a company controlled by Mr. Bart Van Malderen

The Extraordinary General Shareholders’ Meeting of 8 May 2020 approved the introduction of the double voting right. A double voting right is therefore granted to each VGP share that has been registered for at least two years without interruption under the name of the same shareholder in the register of shares in registered form, in accordance with the procedures detailed in article 29 of the Articles of Association. In accordance with Belgian law, dematerialised shares do not benefit from the double voting right. The two main ultimate reference shareholders of the company are therefore (i) Mr Jan Van Geet who holds 39.52% of the voting rights of VGP NV and who is CEO and an executive director and (ii) Mr Bart Van Malderen who holds 23.53% of the voting rights of VGP NV and who is a non-executive director. The full details of the shareholding of VGP can be found in the section “Information about the share” of this annual report.

Lease activities

Drylock Technologies s.r.o, a company controlled by Bart Van Malderen, leases warehouses from VGP and the First Joint Venture under long term lease contracts. The rent received over the year 2023 amounts to € 7.1 million (2022: € 5.1 million). Jan Van Geet s.r.o. leases out office spaces to the VGP Group in the Czech Republic used by the VGP operational team. The leases run until 2026 and 2023 respectively. During 2023 aggregate amount paid under these leases was € 132 k equivalent (2022: € 123 k). All lease agreements have been concluded on an arm’s length basis.

Other services

The table below provides the outstanding balances with Jan Van Geet s.r.o.. The payable balance relates to unsettled invoices. The receivable balances relate to cash advances made to cover representation costs.

In thousands of €

	31. 12. 2023	31. 12. 2022
Trade receivable/(payable)	(67)	—

VGP occasionally also provides real estate support services to Jan Van Geet s.r.o. (and vice versa). During 2023 VGP recorded a € 17 k revenue for these activities (2022: € 12k).

26.2 Subsidiaries

The consolidated financial statements include the financial statements of VGP NV and the subsidiaries listed in note 29. Transactions between the Company and its subsidiaries, which are related parties, have been eliminated in the consolidation and are accordingly not disclosed in this note.

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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

26.3 Joint Ventures

The table below presents a summary of the related transactions with the Group’s Joint Ventures:

In thousands of €

| | 31. 12. 2023 | 31. 12. 2022 |
| :------------------ | :---------- | :---------- |26.3 Transactions with Joint Ventures and Associates
The following table provides details on the transactions with Joint Ventures and Associates:

In thousands of €	2023	2022
Loans outstanding at year-end	875,113	451,289
Investments in Joint Ventures	166,211	116,379
Equity distributions received	3,407	14,154
Dividends distributions received	6,062	23,214
Net proceeds from sales to Joint Ventures	676,245	347,372
Other receivables from/(payables) to the Joint Ventures at year-end	—	55
Management fee income	22,514	18,017
Interest and similar income from Joint Ventures and associates	27,505	17,305

26.4 Key management

Key Management includes the Board of Directors and the executive management. The details of these persons can be found in the section Board of Directors and Management of this Annual Report. Key management personnel compensation is shown in the table below:

In thousands of €	2023	2022
Basic remuneration and short-term incentives and benefits	5,163	4,717
Long term variable remuneration	3,566	—
Total gross remuneration	8,729	4,717

The disclosures relating to the Belgian Corporate Governance Code are included in the Corporate Governance Statement of this annual report. For 2023 no post-employment benefits were granted.

27 Events after the balance sheet date

As per January ’24, the group acquired its first site in Denmark, which is located in the northern part of the Triangle Region, a commercially important region in the centre of Denmark. On an area of more than 175,000 m² will be developed more than 80,000 m² of semi-industrial premises which are suitable for light industry and logistics services. The site is adjacent to the highway E45, exit 61 b Vejle Syd. The park will offer full-scale services including photovoltaics, on-site electric car charging and high-quality technical and sustainable features. As per February ’24, the group divested its stake in the LPM Joint Venture for a consideration of ca € 170 million.

28 Services provided by the statutory auditor and related persons

The audit fees for VGP NV and its fully controlled subsidiaries amounted to € 216.8k and additional non-audit services were performed during the year by Deloitte for which a total fee of € 86.8k was incurred. These fees were mainly paid for the obtained ESG limited assurance report. Audit fees for jointly controlled entities amounted to € 233.6k. Additional non-audit services for jointly controlled entities amounted to € 335.6k.

FINANCIAL REVIEW 2023 PAGE 379

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

29 Subsidiaries, joint ventures and associates

29.1 Full consolidation

The following companies were included in the consolidation perimeter of the VGP Group as at 31 December 2023 and were fully consolidated:

Subsidiaries	Registered seat address	%
VGP NV	Antwerpen, Belgium	Parent (1)
VGP Belgium NV	Antwerpen, Belgium	100
VGP Renewable Energy NV	Antwerpen, Belgium	100
VGP CZ X a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Prostejov a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Ceske Budejovice a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Usti nad Labem City a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Rochlov a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Vyskov a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park Kladno s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Zone Mnichovo Hradiste s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Park CZ 1 s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP – industrialni stavby s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
SUTA s.r.o.	Prague, Czech Republic	100
VGP FM Services s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Renewable Energy s.r.o.	Jenišovice u Jablonce nad Nisou,Czech Republic	100
VGP Industriebau GmbH	Düsseldorf, Germany	100
VGP PM Services GmbH	Düsseldorf, Germany	100
FM Log.In. GmbH	Düsseldorf, Germany	100
VGP Renewable Energy Deutschland GmbH	Düsseldorf, Germany	100
VGP Park Hamburg 4 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Halle S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Rostock S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Ottendorf-Okrilla S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Erfurt S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Berlin Bernau S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Erfurt 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Leipzig Flughafen S.à r.l	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 32 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Berlin-Hönow S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Wiesloch-Walldorf S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Frankenthal 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Hochheim S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Erfurt 3 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Halle 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Nürnberg S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Koblenz S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 47 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Leipzig Flughafen 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 49 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 50 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 51 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 52 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 53 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 54 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 55 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100

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VGP NV ANNUAL REPORT 2023

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Subsidiaries	Registered seat address	%
VGP Logistics S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Asset Management S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Renewable Energy S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Graz 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Laxenburg S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Park Ehrenfeld S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 38 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP DEU 42 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP European Logistics 3 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	100
VGP Industriebau Österreich GmbH	Vienna, Austria	100
VGP Latvija ,SIA	Riga, Latvia	100
VGP Park Riga ,SIA	Riga, Latvia	100
VGP Park Tiraines ,SIA	Riga, Latvia	100
VGP Industrial Development Latvia ,SIA	Riga, Latvia	100
VGP Zone Brasov S.R.L.	Bucharest, Romania	100
VGP Park Sibiu S.R.L.	Bucharest, Romania	100
VGP Park Arad S.R.L.	Bucharest, Romania	100
VGP Park Bucharest S.R.L.	Bucharest, Romania	100
VGP Park Bucharest Two S.R.L.	Bucharest, Romania	100
VGP Park Timisoara Three S.R.L.	Bucharest, Romania	100
VGP Park Timisoara Four S.R.L.	Bucharest, Romania	100
VGP Proiecte Industriale S.R.L.	Bucharest, Romania	100
VGP Renewable Energy S.R.L.	Bucharest, Romania	100
VGP Park Bratislava a.s.	Bratislava, Slovakia	100
VGP Park Zvolen s.r.o.	Bratislava, Slovakia	100
VGP Park Slovakia 2, s.r.o.	Bratislava, Slovakia	100
VGP Park Slovakia 3, s.r.o.	Bratislava, Slovakia	100
VGP Park Bratislava 2 a.s.	Bratislava, Slovakia	100
VGP – industriálne stavby, s.r.o.	Bratislava, Slovakia	100
VGP Service Kft.	Budapest, Hungary	100
VGP Park Hatvan Kft.	Budapest, Hungary	100
VGP Park Györ Beta Kft.	Budapest, Hungary	100
VGP Park Kecskemet Kft.	Budapest, Hungary	100
VGP Park BUD Aerozone Kft.	Budapest, Hungary	100
VGP Park BUD Aerozone 2 Kft.	Budapest, Hungary	100
VGP Park HU 1 Kft.	Budapest, Hungary	100
VGP Park HU Two Kft.	Budapest, Hungary	100
VGP Park HU Three Kft.	Budapest, Hungary	100
VGP Hungary 2 Kft.	Budapest, Hungary	100
VGP Renewable Energy Kft.	Budapest, Hungary	100
VGP Nederland BV	Tilburg, The Netherlands	100
VGP Renewable Energy Netherlands BV	Tilburg, The Netherlands	100
VGP Park Nederland 3 BV	Tilburg, The Netherlands	100
VGP Park Nederland 4 BV	Tilburg, The Netherlands	100
VGP Park Nederland 5 BV	Tilburg, The Netherlands	100
VGP Park Nederland 6 BV	Tilburg, The Netherlands	100
VGP Park Nederland 7 BV	Tilburg, The Netherlands	100
VGP Naves Industriales Peninsula, S.L.U.	Barcelona, Spain	100
VGP Park Sevilla Ciudad de la Imagen, S.L.U.	Barcelona, Spain	100
VGP Park Martorell, S.L.U.	Barcelona, Spain	100
VGP Park Fuenlabrada 2, S.L.U.	Barcelona, Spain	100
VGP Park Alicante, S.L.U.	Barcelona, Spain	100

FINANCIAL REVIEW 2023 PAGE 381

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Subsidiaries	Registered seat address	%
VGP Park Burgos, S.L.U.	Barcelona, Spain	100
VGP Park Córdoba, S.L.U.	Barcelona, Spain	100
VGP Park La Naval, S.L.U.	Bilbao, Spain	100
VGP (Park) Espana 17, S.L.U.	Barcelona, Spain	100
VGP Renewable Energy Spain, S.L.U.	Barcelona, Spain	100
VGP (Park) Espana 19, S.L.U.	Barcelona, Spain	100
VGP (Park) Espana 20, S.L.U.	Barcelona, Spain	100
VGP (Park) Espana 21, S.L.U.	Barcelona, Spain	100
VGP (Park) Espana 22, S.L.U.	Barcelona, Spain	100
VGP (Park) Espana 23, S.L.U.	Bilbao, Spain	100
VGP (Park) Espana 24, S.L.U.

Joint venture

Registered seat	address	%
VGP European Logistics S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP European Logistics 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP Park München GmbH	Baldham, Germany	50
LPM Holding BV	Haghorst, The Netherlands	50
Belartza Alto SXXI SL	Bilbao, Spain	50
Grekon 11 GmbH	Lahnau, Germany	50
VGP Park Goettingen 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP Park Magdeburg S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP Park Laatzen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP Park Gießen Am alten Flughafen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50
VGP Park Berlin Oberkraemer S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	50

Associates

Registered seat	address	%
VGP Park Bingen GmbH	Düsseldorf, Germany	5,1
VGP Park Hamburg GmbH	Düsseldorf, Germany	5,1
VGP Park Hamburg 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Hamburg 3 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Rodgau GmbH	Düsseldorf, Germany	5,1
VGP Park Höchstadt GmbH	Düsseldorf, Germany	5,1
VGP Park Berlin GmbH	Düsseldorf, Germany	5,1
VGP Park Berlin 2 S.à r.l	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Berlin 3 S.à r.l	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Frankenthal S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Leipzig S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Leipzig GmbH	Düsseldorf, Germany	5,1
VGP DEU 3 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Wetzlar S.à r.l	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Ginsheim S.à r.l	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Dresden S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Goettingen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Berlin Wustermark S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Bischofsheim S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Einbeck S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Chemnitz S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Gießen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	5,1
VGP Park Berlin 4 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg	10,1

(1): Holding and service company
(2): Existing or future asset company and renewable energy companies.
(3): Services company
(4): Holding company (including its respective subsidiaries as applicable)
(5): Dormant
(6): The remaining 94.9% (89.9%) are held directly by VGP European Logistics S.a r.l..

29.3 Changes in 2023

(i) New investments

Subsidiaries	Registered seat	address	%
VGP Park France 4 SCI	Lyon, France	100
VGP Park France 5 SCI	Lyon, France	100
VGP Park France 6 SCI	Lyon, France	100
VGP France 2 SAS	Lyon, France	100

(ii) Name change

New Name	Former Name
VGP Energia Renovável Portugal, S.A.	VGP Park Portugal 8 S.A.
VGP Park Fuenlabrada 2, S.L.U.	VGP (Park) España 12, S.L.U.
VGP Park Alicante, S.L.U.	VGP (Park) España 13, S.L.U.
VGP Park Burgos, S.L.U.	Daisen Investments 2020, S.L.U.
VGP Park Córdoba, S.L.U.	Maliset Investments 2020, S.L.U.
VGP Park La Naval, S.L.U.	Urlau Proyectos y Servicios, S.L.U.
VGP Park Vélizy SCI	VGP Park France 4 SCI
VGP Park Parma SRL	VGP Park Italy 5 SRL
VGP Park Montijo, S.A.	VGP Park Portugal 5, S.A.
VGP Renewable Energy Spain, S.L.U.	VGP (Park) Espana 18 S.L.U.

(iii) Subsidiaries divested

Subsidiaries	Registered seat	address	%
VGP Park Sweden 1 AB	Bromma, Sweden	100%
VGP Sweden AB	Bromma, Sweden	100%

(iv) Subsidiaries sold to the First Joint Venture

Subsidiaries	Registered seat
VGP Park Hradek nad Nisou 2 a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic
VGP Park Olomouc 5 a.s.	Jenišovice u Jablonce nad Nisou,Czech Republic
VGP Park Berlin 4 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg

(v) Subsidiaries sold to the Second Joint Venture

Subsidiaries	Registered seat
VGP Park Dos Hermanas, S.L.U.	Barcelona, Spain
VGP Park Granollers, S.L.U.	Barcelona, Spain
VGP Park Valencia Cheste, S.L.U.	Barcelona, Spain
VGP Park Parma 2 Srl	Milan, Segrate, Italy

(vi) Subsidiaries sold to the Fifth Joint Venture

Companies	Registered seat
VGP Park Goettingen 2 S.à r.l.	Luxembourg, Grand Duchy of Luxembourg
VGP Park Magdeburg S.à r.l.	Luxembourg, Grand Duchy of Luxembourg
VGP Park Laatzen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg
VGP Park Gießen Am alten Flughafen S.à r.l.	Luxembourg, Grand Duchy of Luxembourg
VGP Park Berlin Oberkraemer S.à r.l.	Luxembourg, Grand Duchy of Luxembourg

(vii) Registered number of the Belgian companies

Companies	Company number
VGP NV	BTW BE 0887.216.042 RPR – Antwerp (Division Antwerp)
VGP Renewable Energy NV	BTW BE 0894.188.263 RPR – Antwerp (Division Antwerp)
VGP Belgium NV	BTW BE 0894.442.740 RPR – Antwerp (Division Antwerp)

(viii) Subsidiaries sold from VGP NV to VGP Renewable Energy

Companies
VGP Renewable Energy Spain S.L.U.
VGP Energia Renovável Portugal, S.A.

SUPPLEMENTARY NOTES NOT PART OF THE AUDITED FINANCIAL STATEMENTS

For the year ended 31 December 2023

1 Income statement, proportionally consolidated

The table below includes the proportional consolidated income statement interest of the Group in the Joint Ventures. The interest held directly by the Group (5.1% and 10.1%) in the German asset companies of the Joint Ventures have been included in the Joint Ventures’ figures (share of VGP).

Proportionally consolidated income statement
(In thousands of €)

	31.12.2023	31.12.2022
	Group	Joint Ventures
Gros rental and renewable energy income	69,003	102,073
Property operating expenses	(5,534)	(10,496)
Net rental and renewable energy income	63,469	91,577
Joint Ventures management fee income	26,925	—
Net valuation gains/(losses) on investment properties	87,958	(61,179)
Administration expenses	(48,863)	(1,837)
Other expenses	—	—
Operating result	129,489	28,561
Net financial result	(6,031)	(35,434)
Taxes	(25,451)	(3,842)
Result for the period	98,007	(10,715)

2 Balance sheet, proportionally consolidated

The table below includes the proportional consolidated balance sheet interest of the Group in the Joint Ventures. The interest held directly by the Group (5.1% and 10.1%) in the German asset companies of the Joint Ventures have been included in the Joint Ventures’ figures (share of VGP).# Proportionally consolidated balance sheet
In thousands of €

	31.12.2023			31.12.2022
	Group	Joint Venture	Total	Group	Joint Venture	Total
Investment properties	1,508,984	2,442,718	3,951,702	2,395,702	1,916,347	4,312,049
Investment properties included in assets held for sale	875,817	—	875,817	292,541	—	292,541
Total investment properties	2,384,801	2,442,718	4,827,519	2,688,243	1,916,347	4,604,590
Other assets	682,464	2,238	684,702	437,963	3,965	441,928
Total non-current assets	3,067,265	2,444,956	5,512,221	3,126,206	1,920,312	5,046,518
Trade and other receivables	79,486	50,810	130,296	122,113	36,462	158,575
Cash and cash equivalents	209,921	74,355	284,276	699,168	51,207	750,375
Disposal group held for sale	16,804	—	16,804	7,365	—	7,365
Total current assets	306,211	125,165	431,376	828,646	87,669	916,315
Total assets	3,373,476	2,570,121	5,943,597	3,954,852	2,007,981	5,962,833
Non-current financial debt	1,885,154	1,310,253	3,195,407	1,960,464	926,409	2,886,873
Other non-current financial liabilities	—	256	256	—	—	—
Other non-current liabilities	38,085	13,581	51,666	46,419	8,308	54,727
Deferred tax liabilities	23,939	135,625	159,564	79,671	124,440	204,111
Total non-current liabilities	1,947,178	1,459,715	3,406,893	2,086,554	1,059,157	3,145,711
Current financial debt	111,750	20,613	132,363	413,704	17,805	431,509
Trade debts and other current liabilities	84,075	52,564	136,640	110,676	39,818	150,494
Liabilities related to disposal group held for sale	53,284	—	53,284	32,944	—	32,944
Total current liabilities	249,109	73,178	322,287	557,323	57,623	614,946
Total liabilities	2,196,287	1,532,893	3,729,180	2,643,877	1,116,780	3,760,657
Net assets	1,177,189	1,037,298	2,214,417	1,310,975	891,201	2,202,176

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VGP NV ANNUAL REPORT 2023

PARENT COMPANY INFORMATION

Parent company information

For the year ended 31 December 2023

1 Financial Statements

VGP NV

1.1 Parent company accounts

The financial statements of the parent company VGP NV, are presented below in a condensed form. In accordance with Belgian company law, the directors’ report and financial statements of the parent company VGP NV, together with the auditor’s report, have been deposited at the National Bank of Belgium. They are available on request from:

VGP NV
Generaal Lemanstraat 55 bus 4
B-2018 Antwerpen (Berchem)
Belgium
www.vgpparks.eu

The statutory auditor issued an unqualified opinion on the financial statements of VGP NV.

1.2 Condensed income statement

In thousands of €

	2023	2022
Other operating income	21,589	21,630
Operating profit or loss	(6,666)	1,897
Financial result	118,081	36,780
Non-recurring income/(expense) financial assets	175,261	111,688
Current and deferred income taxes	(11,876)	(5,002)
Result for the year	274,800	145,362

FINANCIAL REVIEW 2023
PAGE 387

PARENT COMPANY INFORMATION

1.3 Condensed balance sheet after profit appropriation

In thousands of €

	2023	2022
Formation expenses, intangible assets	18,271	23,737
Tangible fixed assets	91	134
Financial fixed assets	3,481,466	3,271,101
Other non-current receivables	9,705	9,705
Total Non-current assets	3,509,533	3,304,677
Trade and other receivables	31,714	24,225
Cash & cash equivalents	48,678	441,162
Total current assets	80,392	465,387
Total assets	3,589,925	3,770,064
Share capital	136,092	136,092
Share Premium	759,509	759,509
Non-distributable reserves	13,609	13,609
Retained earnings	554,779	380,957
Shareholders’ equity	1,463,989	1,290,167
Amounts payable after one year	1,903,605	1,980,071
Amounts payable within one year	222,331	499,826
Creditors	2,125,936	2,479,897
Total equity and liabilities	3,589,925	3,770,064

Valuation principles

Valuation and foreign currency translation principles applied in the parent company's financial statements are based on Belgian accounting legislation.

2 Proposed appropriation of VGP NV 2023 result

In thousands of €

	2023	2022
Result for the year for appropriation	274,800	145,362
Result brought forward	380,957	313,368
Result to be appropriated	655,757	458,730
Transfer to legal reserves	—	2,722
Result to be carried forward	554,779	380,957
Gross dividend	100,978	75,051
Total	655,757	458,730

The Board of Directors of VGP NV will propose to the Annual Shareholders’ Meeting to distribute a gross dividend of € 3.70 per share corresponding to a total gross dividend amount of € 100,977,854.

PAGE 388
VGP NV ANNUAL REPORT 2023

AUDITOR’S REPORT

Auditor’s report

Statutory auditor’s report to the shareholders’ meeting for the year ended 31 December 2023 – Consolidated financial statements

The original text of this report is in Dutch

Statutory auditor’s report to the shareholders’ meeting of VGP NV for the year ended 31 December 2023 – Consolidated financial statements

In the context of the statutory audit of the consolidated financial statements of VGP NV (“the company”) and its subsidiaries (jointly “the group”), we hereby submit our statutory audit report. This report includes our report on the consolidated financial statements and the other legal and regulatory requirements. These parts should be considered as integral to the report.

We were appointed in our capacity as statutory auditor by the shareholders’ meeting of 12 May 2023, in accordance with the proposal of the board of directors (“bestuursorgaan”/“organe d’administration”) issued upon recommendation of the audit committee. Our mandate will expire on the date of the shareholders’ meeting deliberating on the financial statements for the year ending 31 December 2024.

We have performed the statutory audit of the consolidated financial statements of VGP NV for 17 consecutive periods.

Report on the consolidated financial statements

Unqualified opinion

We have audited the consolidated financial statements of the group, which comprise the consolidated balance sheet as at 31 December 2023, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated cash flow statement for the year then ended, as well as the summary of significant accounting policies and other explanatory notes.

The consolidated balance sheet shows total assets of 4,410,704 (000) EUR and the consolidated statement of comprehensive income shows a profit for the year then ended of 87,292 (000) EUR.

In our opinion, the consolidated financial statements give a true and fair view of the group’s net equity and financial position as of 31 December 2023 and of its consolidated results and its consolidated cash flow for the year then ended, in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.

Basis for the unqualified opinion

We conducted our audit in accordance with International Standards on Auditing (ISA), as applicable in Belgium. In addition, we have applied the International Standards on Auditing approved by the IAASB applicable to the current financial year, but not yet approved at national level.

Our responsibilities under those standards are further described in the “Responsibilities of the statutory auditor for the audit of the consolidated financial statements” section of our report.

We have complied with all ethical requirements relevant to the statutory audit of consolidated financial statements in Belgium, including those regarding independence.

We have obtained from the board of directors and the company’s officials the explanations and information necessary for performing our audit. We believe that the audit evidence obtained is sufficient and appropriate to provide a basis for our opinion.

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KEY AUDIT MATTERS

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

| Key audit matters | How our audit addressed the key audit matters # Testing the valuations

— We compared the amounts per the valuation reports to the accounting records and from there we agreed the related balances through to the financial statements.
— We involved internal valuation specialists to assist the financial audit team to discuss and challenge the significant assumptions and critical judgement areas for specific properties, including yields and estimated rental values and compared to other data we have knowledge of.
— We obtained the external valuation reports and confirmed that the valuation approach is in accordance with RICS in determining the carrying value in the balance sheet.
— For development properties we also confirmed that the supporting information for construction contracts and budgets was consistent with the cost to complete deducted from the valuation of development properties.
— Capitalized expenditure was tested on a sample basis to invoices, and budgeted costs to complete were compared to supporting evidence (for example by inspecting original construction contracts).

Reference to disclosures

The methodology applied in determining the valuation is set out in note 1.3 of the consolidated financial statements. In addition we refer to note 4.1 of the consolidated financial statements containing the investment property roll-forward, note 4.4 in relation to the disposal group held for sale and note 5.1 in relation to investments in joint ventures and associates.

Creation of a new joint venture

In July 2023, VGP has signed a joint venture agreement with DEKA (the “Fifth Joint Venture”) through which VGP sold 50% of the shares of 20 subsidiaries directly to DEKA, thereby losing control over these entities (the “Joint Venture Entities”) which mainly own multiple investment properties. The proper accounting treatment of this joint arrangement in accordance with IFRS is complex, and requires management judgement specifically with respect to:

— Assessing whether under the joint venture agreement, VGP has joint control over the Joint Venture Entities;
— Determining the appropriate accounting treatment upon loss of control of the Joint Venture Entities in the consolidated financial statements of VGP NV;

Proper accounting treatment of the creation of the joint venture is material to the Group’s financial statements: the value of these investments per 31 December 2023, reported on the balance sheet as Investments in joint ventures and associates, for the Fifth Joint Venture amounts to 775.545 (000) EUR. Therefore, the key audit matter relates to the appropriate accounting treatment and disclosure in accordance with IFRS of the creation of this new joint venture.

Reference to disclosures

Refer to note 1.3 for the related accounting policies, note 1.2 in relation to the critical judgements in applying accounting policies and note 5.1 in relation to investments in joint ventures.

Information and standing data

— We tested the standing data the Group provided to the valuers for use in the performance of the valuation, relating to rental income, key rent contract characteristics and occupancy.
— We considered the internal controls implemented by management and we tested the design and implementation of controls over investment properties.
— We held discussions with management and obtained supporting documentation as necessary to ensure that we understood the nature of the transaction. We reviewed the proposed accounting treatment in relation to the Group’s accounting policies and relevant IFRS standards.
— We have read the paragraphs and addenda to the contracts supporting these transactions and evaluated the appropriateness of the recognition and measurement policies applied to the creation of these new joint ventures.
— We have challenged management’s assessment in relation to the joint control of the Fifth Joint Venture.
— We have assessed the accounting treatment upon loss of control of the Joint Venture Entities in the consolidated financial statements of VGP NV.
— We have involved our own IFRS experts to analyze the appropriate accounting treatment of this transaction.
— We have assessed appropriate disclosure of this transaction in the notes to the consolidated financial statements.

PAGE 390 VGP NV ANNUAL REPORT 2023 AUDITOR’S REPORT

Responsibilities of the board of directors for the preparation of the consolidated financial statements

The board of directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium and for such internal control as the board of directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the board of directors is responsible for assessing the group’s ability to continue as a going concern, disclosing, as applicable, matters to be considered for going concern and using the going concern basis of accounting unless the board of directors either intends to liquidate the group or to cease operations, or has no other realistic alternative but to do so.

Responsibilities of the statutory auditor for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a statutory auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISA will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

During the performance of our audit, we comply with the legal, regulatory and normative framework as applicable to the audit of consolidated financial statements in Belgium. The scope of the audit does not comprise any assurance regarding the future viability of the company nor regarding the efficiency or effectiveness demonstrated by the board of directors in the way that the company’s business has been conducted or will be conducted.

As part of an audit in accordance with ISA, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

— identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from an error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
— obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group’s internal control;
— evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the board of directors;
— conclude on the appropriateness of the use of the going concern basis of accounting by the board of directors and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our statutory auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our statutory auditor’s report. However, future events or conditions may cause the group to cease to continue as a going concern;
— evaluate the overall presentation, structure and content of the consolidated financial statements, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
— obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the audit committee regarding, amongst other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the audit committee with a statement that we have complied with relevant ethical requirements regarding independence, and we communicate with them about all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated to the audit committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our report unless law or regulation precludes any public disclosure about the matter.# Other legal and regulatory requirements

Responsibilities of the board of directors

The board of directors is responsible for the preparation and the content of the directors’ report on the consolidated finan- cial statements.

Responsibilities of the statutory auditor

As part of our mandate and in accordance with the Belgian standard complementary to the International Standards on Auditing (ISA) as applicable in Belgium, our responsibility is to verify, in all material respects, the director’s report on the consolidated financial statements as well as to report on these matters.

Aspects regarding the directors’ report on the consolidated financial statements

In our opinion, after performing the specific procedures on the directors’ report on the consolidated financial statements, this report is consistent with the consolidated financial statements for that same year and has been established in accordance with the requirements of article 3:22 of the Code of companies and associations.

In the context of our statutory audit of the consolidated financial statements we are responsible to consider, in par- ticular based on information that we became aware of during the audit, if the directors’ report on the consolidated finan- cial statements and other information disclosed in the annual report on the consolidated financial statements, i.e.:
— the required components of the VGP annual report in accordance with Articles 3:6 and 3:22 of the Code of companies and associations, which appear in the chapter “Report of the Board of Directors”.
are free of material misstatements, either by information that is incorrectly stated or otherwise misleading. In the context of the procedures performed, we are not aware of such a mate- rial misstatement.

FINANCIAL REVIEW 2023 PAGE 391AUDITOR’S REPORT

Statements regarding independence

— Our audit firm and our network have not performed any pro- hibited services and our audit firm has remained independ- ent from the group during the performance of our mandate.
— The fees for the additional non-audit services compatible with the statutory audit, as defined in article 3:98 of the Code of companies and associations, have been properly disclosed and disaggregated in the notes to the consoli- dated financial statements.

Single European Electronic Format (ESEF)

In accordance with the draft standard on the audit of the com- pliance of the financial statements with the Single European Electronic Format (“ESEF”), we have also performed the audit of the compliance of the ESEF format and of the tagging with the technical regulatory standards as defined by the European Delegated Regulation No. 2019/815 of 17 December 2019 (“Del- egated Regulation”).

The board of directors is responsible for the preparation, in accordance with the ESEF requirements, of the consolidated financial statements in the form of an electronic file in ESEF format (“digital consolidated financial statements”) included in the annual financial report. Our responsibility is to obtain sufficient and appropriate evi- dence to conclude that the format and the tagging of the dig- ital consolidated financial statements comply, in all material respects, with the ESEF requirements as stipulated by the Del- egated Regulation.

Based on our work, in our opinion, the format and the tag- ging of information in the official version of the digital consol- idated financial statements included in the annual financial report of VGP NV as of 31 December 2023 are, in all material respects, prepared in accordance with the ESEF requirements as stipulated by the Delegated Regulation.

Other statements

— This report is consistent with our additional report to the audit committee referred to in article 11 of Regulation (EU) No 537/2014.

Signed at Antwerp.

The statutory auditor
Deloitte Bedrijfsrevisoren/Réviseurs d’Entreprises BV/SRL
Represented by Kathleen De Brabander

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GLOSSARY OF TERMS

Glossary of terms

Allianz or Allianz Real Estate Means, in relation to (i) the First Joint Venture, Allianz AZ Finance VII Luxembourg S.A., SAS Allianz Logistique S.A.S.U. and Allianz Benelux SA (all affiliated companies of Allianz Real Estate GmbH) taken together; (ii) the Second Joint Venture, Allianz AZ Finance VII Luxembourg S.A., and (iii) the Third Joint Venture, Allianz Pensionskasse AG, Allianz Versorgungskasse Versicherungsverein a.G., Allianz Lebensversicherungs-AG and Allianz Lebensversicherungs AG.

Allianz Joint Ventures or AZ JV Means the First Joint Venture, the Second Joint Venture and the Third Joint Venture taken together.

AZ JVA(s) or Allianz Joint Venture Agreement(s) Means either and each of (i) the joint venture agreement made between Allianz and VGP NV in relation to the First Joint Venture; (ii) the joint venture agreement made between Allianz and VGP NV in relation to the Second Joint Venture; and (iii) the joint venture agreement made between Allianz and VGP Logistics S.à r.l. (a 100% subsidiary of VGP NV) in relation to the Third Joint Venture.

Annualized committed leases or annualized rent income The annualized committed leases or the committed annualized rent income represents the annualized rent income generated or to be generated by executed lease– and future lease agreements.

Associates Means either and each of the subsidiaries of the First Joint Venture or Fourth Joint Venture in which VGP NV holds a direct 9.9% (10.9%) participation.

Belgian Code of Companies and Associations means the Belgian Code of Companies and Associations dated 23 March 2019 (Wetboek van vennootschappen en verenigingen/Code des sociétés et associations), as amended or restated from time to time.

Belgian Corporate Governance Code Drawn up by the Corporate Governance Commission and including the governance practices and provisions to be met by companies under Belgian Law which shares are listed on a regulated market (the “2020 Code”). The Belgian Corporate Governance Code is available online at HYPERLINK www.corporate- governance committee.be.; www.corporategovernance- committee.be.

Break First option to terminate a lease.

Cash available for debt service Means for the covenant calculation of the Net debt service ratio, the available cash and cash equivalents of the group (i.e. excluding restricted cash) increased by the earnings before interests and depreciations and amortizations of VGP NV.

Contractual rent The gross rent as contractually agreed in the lease on the date of signing.

Dealing Code The code of conduct containing rules that must be complied with by the members of the Board of Directors, the members of executive management, and all employees of the VGP Group, who by virtue of their position, possess information they know or should know is insider information.

Derivatives As a borrower, VGP wishes to protect itself from any rise in interest rates. This interest rate risk can be partially hedged by the use of derivatives (such as interest rate swap contracts).

Development Joint Ventures Means either and each of (i) the joint venture agreement made between Roozen and VGP in relation to the LPM Joint Venture; (ii) the joint venture agreement made between Revikon and VGP in relation to the VGP Park Siegen Joint Venture; and (iii) the joint venture agreement made between VUSA and the VGP in relation to the VGP Park Belartza Joint Venture.

Development JVA(s) Means either and each of (i) the joint venture agreement made between Roozen and VGP in relation to the LPM Joint Venture; (ii) the joint venture agreement made between Revikon and VGP in relation to the VGP Park Siegen Joint Venture; and (iii) the joint venture agreement made between VUSA and the VGP in relation to the VGP Park Belartza Joint Venture.

Discounted cash flow This is a valuation method based on a detailed projected revenue flow that is discounted to a net current value at a given discount rate based on the risk of the assets to be valued.

EPRA The European Public Real Estate Association, a real estate industry body, which has issued Best Practices Recommendations Guidelines in order to provide consistency and transparency in real estate reporting across Europe.

EPRA Net Reinstatement Value (EPRA NRV) Basic NAV adjusted for fair valuation of derivatives; deferred tax and transaction costs (real estate transfer tax and purchaser’s costs).

EPRA Net Tangible Assets (EPRA NTA) Basic NAV adjusted for fair valuation of derivatives, deferred taxes and Intangible fixed assets. This metric includes the transaction costs (real estate transfer tax and purchaser’s costs).

EPRA Net Disposal Value (EPRA NDV) Basic NAV adjusted for fair valuation of fixed interest rate debt.

EPRA Earnings Earnings from operational activities, i.e. (i) excluding changes in value of investment properties; (ii) result on disposal of investment properties, development properties held for investment and other interests; (iii) fair value of derivatives; (iv) deferred taxes and (v) acquisition costs on share deals and non-controlling joint venture interests.

FINANCIAL REVIEW 2023 PAGE 393GLOSSARY OF TERMS

EPRA Net Initial Yield (NIY) Annualised rental income based on the cash rents passing at the balance sheet date, less non-recoverable property operating expenses, divided by the market value of the property, increased with (estimated) purchasers’ costs.

EPRA “Topped-up” NIY This metric incorporates an adjustment to the EPRA NIY in respect of the expiration of rent-free periods (or other unexpired lease incentives such as discounted rent periods and step rents).

EPRA Vacancy Rate Estimated Market Rental Value (ERV) of vacant space divided by ERV of the whole portfolio.

EPRA Cost Ratio Administrative and operating costs (including and excluding costs of direct vacancy) divided by gross rental income.

EPRA Loan to value (LTV) ratio The proportion of the gross asset value of Investment property funded by net debt.# GLOSSARY OF TERMS

Equivalent yield (true and nominal) Is a weighted average of the net initial yield and reversionary yield and represents the return a property will produce based upon the timing of the income received. The true equivalent yield assumes rents are received quarterly in advance. The nominal equivalent assumes rents are received annually in arrears.

Estimated rental value (“ERV”) Estimated rental value (ERV) is the external valuers’ opinion as to the open market rent which, on the date of valuation, could reasonably be expected to be obtained on a new letting or rent review of a property.

Exit yield Is the capitalisation rate applied to the net income at the end of the discounted cash flow model period to provide a capital value or exit value which an entity expects to obtain for an asset after this period.

Fair value The fair value is defined in IAS 36 as the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction. In addition, market value must reflect current rental agreements, the reasonable assumptions in respect of potential rental income and expected costs.

First Joint Venture Means VGP European Logistics S.à r.l., the 50:50 joint venture between VGP and Allianz, also referred to as “Rheingold”

Fourth Joint Venture Means VGP European Logistics 1 S.à r.l., the 50:50 joint venture between VGP and Allianz, also referred to as “Europa”

Fifth Joint Venture Means the 50:50 joint venture between Deka Immobilien, through their funds “Deka Immobilien Europa” and “Deka Westinvest InterSelect” and VGP.

Grekon Joint Venture or Grekon Means Grekon KG GmbH, the 50:50 joint venture between VGP and Revikon GmbH, part of Weimar Gruppe

Gearing ratio Is a ratio calculated as consolidated net financial debt divided by total equity and liabilities or total assets.

IAS/IFRS International Accounting Standards/ International Financial Reporting Standards. The international accounting standards drawn up by the International Accounting Standards Board (IASB), for the preparation of financial statements.

Indexation The rent is contractually adjusted annually on the anniversary of the contract effective date on the basis of the inflation rate according to a benchmark index in each specific country.

Insider information Any information not publicly disclosed that is accurate and directly or indi- rectly relates to one or more issuers of financial instruments or one or more financial instruments and that, if it were publicly disclosed, could significantly affect the rice of those financial instru- ments (of financial instruments derived from them).

Investment value The value of the portfolio, including transaction costs, as appraised by independent property experts.

Joint Ventures Means either and each of (i) the First Joint Venture; (ii) the Second Joint Venture, (iii) the Third Joint Venture, (iv) the LPM Joint Venture, (v) the Grekon Joint Venture; and (vi) the Fifth Joint Venture.

LPM Joint Venture or LPM Means LPM Holding B.V., the 50:50 joint venture between VGP and Roozen Landgoederen Beheer.

LPM JVA or LPM Joint Venture Agreement Means the joint venture agreement made between Roozen Landgoederen Beheer and VGP NV in relation to the LPM Joint Venture.

Lease expiry date The date on which a lease can be cancelled.

LTV Means Loan-to-value and is determined by dividing the net financial debt by Investment property

Market capitalisation Closing stock market price multiplied by the total number of outstanding shares on that date.

Net asset value The value of the total assets minus the value of the total liabilities.

Net debt service Means for the covenant calculation of the Net debt service ratio, the sum of the Net finance charges and capital repayments on financial debt of the year.

Net finance charges Means for the covenant calculation of the Interest cover ratio, the net financial result of the group corrected for the capitalized interests.

Net financial debt Total financial debt minus cash and cash equivalents.

Net Initial Yield Is the annualized rents generated by an asset, after the deduction of an estimate of annual recurring irrecoverable property outgoings, expressed as a percentage of the asset valuation (after notional purchaser’s costs).

Occupancy rate The occupancy rate is calculated by dividing the total leased out lettable area (m²) by the total lettable area (m²) including any vacant area (m²).

Prime yield The ratio between the (initial) contractual rent of a purchased property and the acquisition value at a prime location.

Project management Management of building and renovation projects. VGP employs an internal team of project managers who work exclusively for the company.

Property expert Independent property expert responsible for appraising the property portfolio.

Property portfolio The property investments, including property for lease, property investments in development for lease, assets held for sale and development land.

Reversionary Yield Is the anticipated yield, which the initial yield will rise to once the rent reaches the ERV and when the property is fully let. It is calculated by dividing the ERV by the valuation.

Roozen or Roozen Landgoederen Beheer Means in relation to the LPM Joint Venture, Roozen Landgoederen Beheer B.V.

Second Joint Venture Means VGP European Logistics 2 S.à r.l., the 50:50 joint venture between VGP and Allianz, also referred to as “Aurora”

Sixth Joint Venture Means 50:50 Joint Venture with AREIM Pan-European Logistics Fund (D) AB, or Areim, also referred to as “Saga”

Take-up Letting of rental spaces to users in the rental market during a specific period.

Third Joint Venture Means VGP Park München Gmbh, the 50:50 joint venture between VGP and Allianz.

VGP European Logistics or VGP European Logistics joint venture Means the First Joint Venture.

VGP European Logistics 1 or VGP European Logistics 2 joint venture Means the Second Joint Venture.

VGP Park Moerdijk Means the LPM Joint Venture.

VGP Park Belartza Joint Venture Means Belartza Alto SXXI, S.L., a 50:50 joint venture between VGP en VUSA

VGP Park München or VGP Park München joint venture Means the Third Joint Venture.

VGP Park Siegen Joint Venture Means Grekon KG GmbH, the 50:50 joint venture between VGP and Revikon.

Vusa Means Valeriano Urrutikoetxea, S.L.U.; Galdakarra XXI, S.L.; Saibigain XXI, S.L.U.; and Belartza Garaia, S.L.U.;

Weighted average term of financial debt The weighted average term of financial debt is the sum of the current financial debt (loans and bonds) multiplied by the term remaining up to the final maturity of the respective loans and bonds divided by the total outstanding financial debt.

Weighted average term of the leases (“WAULT”) The weighted average term of leases is the sum of the (current rent and committed rent for each lease multiplied by the term remaining up to the final maturity of these leases) divided by the total current rent and committed rent of the portfolio

Weighted average yield The sum of the contractual rent of a property portfolio to the acquisition price of such property portfolio.

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STATEMENT OF RESPONSIBLE PERSONS

Statement of responsible persons

The undersigned declare that, to the best of their knowledge:

— The annual accounts, which are in line with the standards applicable for annual accounts, give a true and fair view of the capital, the financial situation and the results of the Company and the consolidated subsidiaries;

— The annual report gives a true and fair view of the development and the results of the Com- pany and of the position of the Company and the consolidated companies, as well as a description of the main risks and uncertainties they are faced with.

Jan Van Geet as permanent representative of Jan Van Geet s.r.o. CEO

Piet Van Geet as permanent representative of Urraco BV CFO

Disclaimer

This report may contain forward-looking statements. Such statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. VGP is providing the information in this report as of this date and does not undertake any obligation to update any forward-looking statements contained in this report in light of new information, future events or otherwise. The information in this report does not constitute an offer to sell or an invitation to buy securities in VGP or an invitation or inducement to engage in any other investment activities. VGP disclaims any liability for statements made or published by third par- ties and does not undertake any obligation to correct inaccurate data, information, conclusions or opinions published by third parties in relation to this or any other report or press release issued by VGP.

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VGP NV ANNUAL REPORT 2023

Notes

VGP NV
Generaal Lemanstraat 55 box 4
2018 Antwerp
Belgium
tel +32 3 289 14 30
fax +32 3 289 14 39
e-mail info@vgpparks.eu
www.vgpparks.eu

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