Stuart Law – CEO Assetz plc and Assetz Fund Management Ltd Why Cyprus Why Cyprus Fund Investment Strategy Fund Investment Strategy Where to Invest Where to Invest Returns Available Returns Available

Why Cyprus

 Cyprus is the third largest island in the Mediterranean Sea – population of 750,000  Cyprus has developed as a favoured tourist destination  The economy has developed significantly  Economy is free market services based  Became a full member of the EU in May 2004  Set to use the Euro in January 2008  Has a strong British presence and ex-pat community  A significant portion of tourism income comes from Britain but also Russians, Norwegians and other Europeans  Legal and land registry systems are largely based on British practices

Why Cyprus  Corporation tax rates are amongst the lowest in Europe  The country has a well educated labour force  Established business and financial services  Modern telecommunications  International transport capabilities  Low crime rate  English is widely spoken throughout Cyprus  Cyprus boasts on average 300 days of sunshine per year  Cypriots drive on the left hand side of the road

Why Cyprus

Fund Investment Strategy Diverse range of investments that are rental-backed including : Diverse range of investments that are rental-backed including : Local let residential property Student let residential property Holiday let residential property Commercial Office property Commercial Retail property

Local Let Residential Property

 In cities such as Limassol there is restricted availability of affordable accommodation for locals  Property being built for this purpose is achieving around 8% initial yield  Pressure on rental growth is strong leading to the imposition of a limitation on rental uplifts capped at 14% every two years  Specific developments have been identified at an early stage that may be purchased for this purpose with an experienced full management company in place

Student Let Residential Property

 Specific opportunities in two cities on the University campuses  Student halls of residence with commercial space for laundrettes, shops, etc.  Gross yields estimated at 10%  Individual dedicated student flats are under the local apartment rental rates and prices even at these yields

Holiday Let Residential Property

 A number of sites have been identified where it is possible to customise the building of apartments and villas for tour operator use  Initial negotiations are underway with a number of operators to pre-let clusters of holiday villas or apartments for occupation once completed on a 3 year contract  Delivery expected in approximately 2 years but contracts would be signed now  Rental income will service all debt and be profitable

Commercial Office Property

 The Fund has identified a potential opportunity to purchase a new-build pre-let to the Cypriot government by co-bidding with the main contractor for the contract  Other opportunities exist due to government moves to modern offices decentralised from the centre of the Capital  Lenders are indicating up to 75% loan to value on this type of investment  Initial indications are for a 10% gross yield on purchase price

Commercial Retail Property

 There is a lack of large retail parks in Cyprus, retail being centred primarily on small shops  We plan to work with local developers to seek out suitable sites for such developments with planning permission and then seek pre-lets from larger retailers, both local and international, and to agree to fund the development and purchase the complete property  One site has already been identified in the heart of the main ex-pat British community that is extremely well located

Mortgages and Yields  Mortgages - Low Base rates  Euro Libor rate  Swiss Franc Libor rate  + 1.5% typically  On 70% LTV effective rates of 2.8% of property price typically

Mortgages and Yields  Yields  8% local let  Less 10% full management  7.2% net yield  Less 2.8% effective interest rate cost  4.4% of property price in gross profit  4% net profit after tax

Mortgages and Yields  Returns  If prices rise at 7% pa total return is 11.4% of the property price pa or 38% pa on property equity  If rent grows at 7% pa then in the 5 th year the total return is around 15% of the original property price or 50% of the original equity

Fund Structure Consortium Investment Management Limited

Owned by Allsop LLP

Consortium launched in 2002 Over £½ billion of assets currently under management Establish, operate and manage funds for clients of: Barclays Capital KPMG BDO Stoy Hayward Assetz

Thank you  Stuart Law  Assetz Fund Management Ltd