1. Does sustainability fit well with Crisis? Thierry Delvaux Managing Director Hungary & Romania October 14, 2008 Subprime

2. 2 Impact of the crisis on investments in CEE countries Investment volume 2006 - Q3 2008 Source: Jones Lang LaSalle Research, 2008 € million

3. 3 Investment volume in the CEE region -53% Source: Jones Lang LaSalle Research, 2008

4. 4 m2m2 Still robust office leasing market in Budapest

5. 5 Impact of the crisis on developers and investors Cost of financing (above interest rate) Margins in 2007Margins till summer 2008 German Open Ended Funds 30-60 bps 100 bps International Investors 80-110 bps 150 bps Hungarian Banks 150 bps 200-220 bps + or no availability Margins today Banks may terminate their signed financing contracts No interbank lending LTY 75-80% 65-70%

6. 6 Demand for real estate products No balance of demand and supply In the last years demand was high and supply was low Subprime crisis Today: low demand and high supply High prices and low yields Lower prices and higher yields

7. 7 Yield Q 3 08 (vs. Q 2 07) in % OfficePrimarySecondary Czech Republic6.00 (5.25)7.00 (6.00) Hungary6.25 (5.75)7.50 (7.00) Poland6.00 (5.50)7.00 (6.00) Retail Czech Republic6.00 (5.50)7.00 (7.00) Hungary6.00 (5.75)7.25 (7.25) Poland5.50 (5.50)7.00 (7.00) Source: Jones Lang LaSalle Research, 2008 Yields are moving upwards across CEE

8. 8 Will rents go up?

9. 9 Sustainable Real Estate Back to basics: Real Estate vs operating income Green features: not a premium but a must Multinational firms relocating to the CEE have „green” requirements but do not pay more for it

10. 10 What makes a building „green”? Geothermal heat pump system Solar collectors BMS (Building Management System) Storm water collection Ice chillers Installations of low-energy systems „Green” construction Daylight and views of 90% of the space Green roof Re-use of materials (Waste construction materials) Selective waste collection Preference for local products Bicycle storage Tram or metro access LEED or BREEAM international labeling

11. 11 Investment volume is down Robust take-up on the leasing market Increased cost of finance – increased yields Sustainability is a must

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