1. Page 1 Interim Results for the Six Months ended 31st March 2004 15 June 2004

2. Page 2 Contents Corporate Introduction Highlights Financial –Summary Profit and Loss Account –Market Value Balance Sheet –NAV Movements –Diluted NAV –Cashflow –Debt Cost –Debt Maturity Tenanted Residential –Commentary –Key Features –Key Performance Facts –Portfolio Analyses Development and trading –Commentary –Commentary on sites with end development value >£20m Opportunities Appendices

3. Page 3 Corporate Introduction Grainger is the UK’s largest quoted residential property investor and trader. Grainger specialises in regulated and life tenancies and owns a residential portfolio of circa 11,600 units. Total value of property owned is £1.2 billion. Grainger has two further divisions:- –Residential/mixed use development –Fund and property management

4. Page 4 Financial Highlights Profit before tax and exceptional items£35.1m+57% Earnings per share pre exceptional items 85.8p+61% Dividend per share 4.04p+15% Tenanted residential sales of £74m exceeded VP values by 8.9% Portfolio comprises 11,613 units –Investment value of £1,124m –VP value of £1,596m Development and trading division rationalised+180% –£17m operating profits

5. Page 5 Summary Profit and Loss Account

6. Page 6 Market Value Balance Sheet

7. Page 7 NAV Movements

8. Page 8 Diluted NAV

9. Page 9 Cashflow

10. Page 10 Debt Cost Variable/Under One YearHedgedFixed over one yearFixed to termination Gross Debt£736m£761m Hedging Level80% Blended Interest Rate5.9% Gearing Level121%125% LTV52.5%52.9% £231m 5.4% £150m 5.0% £292m 6.4% £63m 7.2% £235m 4.8% £150m 4.9% £298m 6.6% £78m 8.1% 31 March 200430 September 2003

11. Page 11 Debt Maturity Over year or lessBetween 1 and 2 yearsBetween 2 and 5 yearsBetween 5 and 10 years £48m 5.1% £150m 4.9% Over 10 years £359m 48.8% £101m 13.7% £96m 13.1% £65m 8.8% £115m 15.6% £359m 47.2% £76m 10.0% £47m 6.2% £69m 9.1% £210m 27.5% Gross Debt£736m£761m Cash£93m£82m Net Debt£643m£679m Average maturity5.7 years5.9 years 31 March 200430 September 2003

12. Page 12 Divisional Highlights Tenanted Residential- Strong sales - Limited acquisitions Trading & Development- Kennel Farm sales - Disposal of Commercial - New divisional structure Fund Management- Integration - Systems and reporting - PIF consultation

13. Page 13 Tenanted Residential - Highlights Total sales 7% higher at £74m from 14% fewer units sold Average sales price of £109K Average increase over Sept. 2003 VP values of 8.9% (normal sales) High sales margin of 38% Current portfolio stands at VP value of approximately £1.6 billion Life tenancies - regulation

14. Page 14 Tenanted Residential - Key Performance Facts (GT + 50% BPT)

15. Page 15 Tenanted Residential - Commentary Good sales performance, September VP’s exceed by 8.9% Acquisitions analysis Total reversionary surplus on residential portfolio £472m No £mVP £mas %VP Regulated11112.817.772 Life Tenancies624.29.047 AST, others60.50.771 17917.527.464

16. Page 16 Tenanted Residential - Portfolio Analysis by Investment Value Regulated £842m 72.3% APT £87m 7.5% £134m 11.5% Vacant £51m 4.4% Other £23m 2.0% £27m 2.3% Total units11,613 Total VP Investment value£1,124m Reversionary surplus£472m £1,596m Reversionary surplus per share£19.03 Regulated £820m 73.0% APT £41m 3.6% £68m 6.0% £138m 12.3% Vacant £40m 3.6% Other £17m 1.5% 12,030 £1,164m £484m £19.55 £1,648m 31 March 200430 September 2003 Life Tenancies/ Reversions Life Tenancies/ Reversions Assured

17. Page 17 Tenanted Residential - Portfolio Analysis by VP value Total VP = £1,618m (other interests of £30m omitted) £0-£50K £63m 3.9% £241m 14.9% £241m 14.9% £613m 37.9% £613m 37.9% £246m 15.2% £246m 15.2% £500K + £32m 2.0% £423m 26.1% £423m 26.1% £0-£50K £59m 3.7% £234m 14.9% £234m 14.9% £594m 37.7% £594m 37.7% £241m 15.3% £241m 15.3% £500K + £32m 2.0% £415m 26.4% £415m 26.4% Total VP = £1,575m (other interests of £21m omitted) £250- £500K £50- £100K £100K- £175K £175- £250K £175- £250 £250- £500K £50- £100K 31 March 200430 September 2003

18. Page 18 Tenanted Residential - Portfolio Analysis By Number of Units £250-£500K 756 6.3% £500K + 50 0.4% Total units = 12,030 3,106 25.8% 3,106 25.8% 4,434 36.9% 4,434 36.9% 2,045 17.0% 2,045 17.0% 1,639 13.6% 3,010 25.9% 3,010 25.9% 4,300 37.0% 4,300 37.0% £250-£500K 742 6.4% 2,008 17.3% 2,008 17.3% 1,505 13.0% £500K + 48 0.4% Total units = 11,613 £0-£50K £50-£100K £100K-£175K £175-£250K £0-£50K 31 March 200430 September 2003

19. Page 19 Tenanted Residential – Regional Analysis 6.8% of our properties are valued above £350K (vacant possession) 40.3% of our properties are valued below £150K (vacant possession) NumberIVVP of units£m % 01Central London57512717111.3% 01Inner London1,20718725116.6% 01Outer London1,40316723614.9% 02South East1,95421030518.7% 03South West811641005.7% 04East964801227.1% 05East Midlands66934533.0% 06West Midlands1,1781111509.9% 07Wales78580.4% 08Yorkshire73734503.0% 09North West1,648861237.7% 10North East20412181.1% 11Scotland185790.6% 11,6131,1241,596100.0% % 10.7% 15.7% 14.8% 19.1% 6.3% 7.6% 3.3% 9.4% 0.5% 3.2% 7.7% 1.1% 0.6% 100.0%

20. Page 20 Development and Trading - Commentary Operating profit up to £17.0m from £6.1m 12.4 acres of land at Kennel Farm sold for £14.2m £19.0m of commercial investment property sold at £2.8m above 30 September 2003 values Focus on residential and mixed use developments -Land & Regeneration -Housebuilding -Urban and Mixed Use

21. Page 21 Commentary on Sites with End Development £20m+ PropertyDescriptionStatus SloughMixed use development Hotel sold to Travelodge (office element 69,000 sq. ft)Leisure unit let to LA Fitness Retail units under offer Office available to let Pimlico SW179 unit residential schemePractical completion due end June 2004 Contracts Exchanged on sale of 66 units, 5 units reserved, 8 available Former South 77 residential units above a newConstruction commenced London HospitalTesco foodstore Completion June 2006 Clapham, SW4 Macaulay Road,110,000 sq. ft. mixed use schemeApplication submitted Clapham. SW4Anticipate decision late 2004 Hornsey RoadPublic/private partnership mixed useAnticipate exchange of Bath & Barnsburyscheme, 350 residential units, 43,000contracts on purchase with Complex, Islingtonsq. ft. Council office and community useLondon Borough of Islington in July 2004

22. Page 22 Opportunities Focus on core regulated tenancy market Expand life tenancy business – to be regulated in due course Ensure maximum advantage taken of any PIF structure Look at opportunities in Europe – controlled risk approach Development and trading business focus on residential or mixed use

23. Page 23 Appendices Summary of tenancy types Detailed Profit and Loss Account Tenanted Residential - Stock Analysis Tenanted Residential - Return by Region

24. Page 24 Summary of Tenancy Types Regulated by Security of tenure Other characteristics Regulated Assured Periodic Assured Life Tenancies Rent Act 1977 Yes - with succession rights Since 1988 no new regulated therefore declining stock Housing Act 1988 Yes Housing Act 1988 Yes - Tenants transfer ownership in return for rent-free occupation and lump sum Assured Shorthold Housing Act 1988 No Rent Market rent Usually no rent Tenancy arises as a result of succession from regulated Tenant has the right to renew tenancy Landlord may get possession if appropriate notice is served Set by rent officer every two years. Increases capped at RPI + 2.5% per annum.

25. Page 25 Detailed Profit and Loss Account

26. Page 26 Tenanted Residential - Stock Analysis Vacant Possession Invest- No. ofMarketmentCurrent ResidentialCostValue Gross Units£m % ageRent Regulated7,8546148201,1317330 Assured periodic456294151802 Assured shorthold568606878874 Life tenancies/reversions2,37712213827151- Vacant35826404491- 11,6138511,1071,5757036 Other interests-131721-1 11,6138641,1241,596-37 30 September 200312,0308921,1641,6487138

27. Page 27 Tenanted Residential - Return By Region Net RentsTradingTotal P & L £m 01Central London0.82.83.6 01Inner London1.14.55.6 01Outer London1.75.87.5 02South East1.83.95.7 03South West0.42.93.3 04East0.73.03.7 05East Midlands0.21.01.2 06West Midlands1.21.72.9 07Wales-0.2 08Yorkshire0.41.11.5 09North West1.23.64.8 10North East0.11.01.1 11Scotland0.10.20.3 9.731.741.4

28. Page 28 Interim Results for the Six Months ended 31st March 2004 15 June 2004