Kornmarksvej 1, 2605 Brøndby

INVESTMENT MEMORANDUM

KORNMARKSVEJ 1 | 2605 BRØNDBY | CSIK90024 | RLU/HLY

LOGISTICS AND ADMINISTRATION PROPERTY IN THE COPENHAGEN METROPOLITAN AREA,

FULLY LET

• 47 000 sq. m. commercial area, ca. 110 000 sq. m. ground area • Possible opportunity of additional building upwards, if dispensation is given • Architect designed office building with ventilation & cooling • 70 gates at ramp height, with sluices – ceiling height up to 8,7 m • Property located only 15 km from central Copenhagen and close to the motorway grid • Price: 319 000 000 DKK, eqvivalent initial yield of 6% + deferred tax • The property is for sale in it's svp with dererred taxes of about 17 million DKK • Current yearly taxable depreciations of 15 million DKK

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3  NEWSEC EGESKOV & LINDQUIST

THE PROPERTY

The property contains a total ground area of 110 278 sq. m. on two cadastrals of 98 574 sq. m. and 11 704 sq. m., respectively. The total building area is 49 866 sq. m., according to the BBR. (The rent-bearing area has been measured to 47 121 sq. m.) and it consists of an office section and a warehouse section. The latter is composed of several building parts, built in different time periods. The main building was built in 1972.

The newest building, of 1 905 sq. m., was built in 2015.

Through the years upgrading and conversions have been carried out, including with regards to energy consumption.

Since the total allowed extra building right percentage is around 32 000 sq. m. there are still unused building rights on the property. However, to use the remaining building rights it would be necessary to obtain a dispensation due to restric4  KORNMARKSVEJ 1

tions in the local development plan regarding a limit stated in the cubic metre specification.

The property is used for warehousing/distribution and administration. The property is fully let with two tenants on new contracts from 2017, and the property is divided into two separate headquarters with their own main entrances. The anchor tenant, Intervare A/S, uses the entire warehouse space for food and non-food goods which are sold online to private consumers. The furnishing of a new, fully automated warehouse is currently ongoing. The tenant carries the expenses.

The property has 70 gates, most of these are at ramp height with sluices. 37 gates are suited for delivery vans. One

building has 46 ramps/sluices and two gates at ground level, distributed along either side of the building. In the warehouses, daylight comes in through skylights. The warehouse area is divided into sections with a height of up to 8,7 m and the area consist of several buildings, which provides flexibility, in case the warehouses are to be shared by several new tenants.

with toilets and showers and a range of technical functions are located.

The administration area of the property has a nice and modern interior design with a shared canteen and a large kitchen. However, a new canteen for Intervare A/S is currently being furnished, so that the tenants will no longer share a canteen. From the administration area there is direct access to the heated warehouse. The offices have air conditioning systems.

INTERVARE A/S (NEMLIG.COM)

NILFISK A/S

The tenant has a separate entrance in one end of the building complex, from Kornmarksvej. Access to the building is through a modern and presentable reception area. From the reception, the office house, divided into three blocks and with a glass walkway, can be reached. The offices have a modern design, with floor-to ceiling glass panels as well as some welcoming common areas perfect for informal meetings.

The offices are primarily furnished as open offices in different sizes. Here are also offices for the management and meeting rooms. Below the office section there is a basement

In connection with the office the property’s canteen is found, with a kitchen which is approved for the preparation of food, and two dining areas. One dining area can be divided using a screen door.

The tenant has a separate entrance in one end of the building complex from Banemarksvej. The warehouse has access from Park Allé. The administration area is also entered through a modern and presentable reception area. It is light and welcoming and features large windows. from the office section there is direct access to the heated warehouse area. The warehouse section is divided into sections in the halls with a height of up to 8,7 m. The newer halls are without columns. The tenant has financed the furnishing of an area for cooling and freezing in parts of the warehouse area.

The property has large outside areas, including an accessing area, which can be reached from Park Allé.

A tall stone wall encloses the area and the outside ground is covered with paving stones and asphalt. In front of the administration area, towards Kornmarksvej and Banemarksvej, there are parking lots for passenger cars.

5 NEWSEC EGESKOV & LINDQUIST

THE AREA AND ITS TRAFFIC CONNECTIONS From the property to

1 2 3 4 5

Albertslund train station

1,5 km.

2 min.

Holbæk motorway

1,2 km.

2 min.

Motorring 3

4,4 km.

4 min.

16 km.

16 min.

21,2 km.

15 min.

Town Hall square Copenhagen airport

The property is situated in Brøndby, one of the largest commercial areas of the Copenhagen metropolitan area. It borders on the Glostrup, Albertslund and Vallesbæk municipalities. A good infrastructure characterizes the area, with its proximity to the motorway network system and therefore great connections to the greater Copenhagen area, the airport and, consequentially, to the eastern and southern parts of Denmark.

The Brøndby commercial area is very attractive for companies within the transport, distribution, and warehousing industries. Many of those are located in the area. To mention a few: Kühne & Nagel, DHL, JH Transport and RTC Transport. COOP and AB Catering have

3

1

2 6 KORNMARKSVEJ 1

food warehouses in the area. Together with the other commercial areas in Brøndby and the neighbouring municipalities Vallensbæk, Herlev, Glostrup and Rødovre, Brøndby houses many production units, industrial corporations, and craft businesses. This part of the metropolitan area is home to a substantial part of the corporations in the region.

The area is situated in the Brøndbyvester district, the smallest of three very different parts which form the Brøndby municipality in the suburban area to the vest of central Copenhagen (Vestegnen). The Brøndby area as a whole has 35 367 inhabitants (2017), and it is a part of Region Hovedstaden, the most densely populated region in Denmark, with around 1 811 million inhabitants. The region expects its population to grow to around 2 145 million people by the year 2045.

motorway (primary route 21) and the Køge Bugt motorway (E20/E47/E55).

The municipality is a part of the Copenhagen metropolitan area and it has grown together with the other suburban municipalities, so that the area from Copenhagen outwards including Høje Taastrup, Ishøj, Greve, and so forth form the southern part of metropolitan Copenhagen towards Zealand.

THE RAILWAY

The train line Copenhagen-Roskilde, with local trains as well as long distance trains, and the train line Copenhagen-Køge, with local trains, cut through the municipality. Brøndbyøster train station and Brøndby Strand train station are located in the area.

BUSES

To the east of the commercial area Brøndby the Brøndby municipality has projected a large development area called ”the Big I” in the municipality plan for 2009-2021. It stretches from Roskildevej to the north all the way to Brøndby Strand in the south and it follows Vestervold and Motorring 3 which connects to the restructuring project in Kirkebjerg near Glostrup train station and the area at Brøndbyøster train station. The purpose is to ensure that the Brøndby municipality stands as one unit and is perceived as one city.

Close to Kornmarksvej you have the following connections by bus: stopping on Banemarksvej bus 22 (Glostrup train station - Husum Torv) and stopping on Vallensbæk Torvevej, bus 144 (Vallensbæk train station - Ballerup train station).

In the municipality plan of 2013 an additional tier going north to south runs in parallel to the light railway of Ring 3. This development unit contains the Kirkebjerg commercial area and the eastern part of Brøndby along Søndre Ringvej.

Close to the property, the entire area around Banemarksvej is being redeveloped to contain urban developments with private housing and urban commodities. The area is expected to be made available to the establishment of new urban neighbourhoods with around 1100 new homes over a period of 5-10 years.

The existing Brøndby municipality was created when the parishes of Brøndbyøster, Brøndbyvester and Brøndby Strand were merged in 1970. Ring 3 of the motorway network (E47/ E55) cuts through the municipality, and so does the Holbæk

THE LIGHT RAILWAY

Copenhagen is going to get a new light railway, which is going to go on Ring 3 from Ishøj in the south, going north all the way to Lundtofte. The light railway is expected to start operating from 2023/2024. There are going to be 27 stops on the 27 kilometres of the line and with departures every five minutes on weekdays. Also, the light railway is going to stop at the existing train stations of Ishøj, Vallensbæk, Glostrup, Herlev, Buddinge and Lyngby. The light railway is going to stop at Park Allé, less than 1 km from Kornmarksvej.

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5 7 NEWSEC EGESKOV & LINDQUIST

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PUBLIC INFORMATION / PROPERTY FACTS Land inventory The property is situated at Kornmarksvej 1, 2605 Brøndby, cadastral numbers 20 k and 20 in Brøndbyvester By, Brøndbyvester.

The total area of the property according to the BBR: Cadastral no.

Ground area (sq. m.)

Road (sq. m.)

20 k Brøndbyvester By, Brøndbyvester

98 574

0

20 in Brøndbyvester By, Brøndbyvester

11 704

0

110 278

0

Total

9 NEWSEC EGESKOV & LINDQUIST

Buldings:

N

22

5

6 8

1 3

4 9

7

10  KORNMARKSVEJ 1

The total area of the property according to the BBR: Built on area (sq. m.)

Building area in total (sq. m.)

Basement (sq. m.)

Attic (sq. m.)

Commercial area in total (sq. m.)

32 023

32 727

160

0

32 727

Office

4 261

5 749

554

0

10 402

No. 3

Office

56

56

0

0

56

No. 4

Warehouse

4 541

4 656

0

0

4 656

No. 5

Outbuilding

13

13

0

0

0

No. 6

Outbuilding

15

15

0

0

0

No. 7

Outbuilding/ pallet shed

955

955

0

0

0

No. 8

Warehouse

1 905

1 905

0

0

1 905

No. 9

Office

120

120

0

0

120

43 889

46 196

714

0

49 866

Building

Use

No. 1

Warehouse

No. 2

Total

The BBR registered area differs from the rent-bearing area. The property´s area is, according to the rental agreements, distributed as follows: Warehouse

2 020 sq. m.

(73%)

Office

1 691 sq. m.

(20%)

489 sq. m.

(5%)

1 163 sq. m.

(2%)

47 121 sq. m.

(100%)

Warehouse/production Basement Total

The property is located in an urban area in the Brøndby municipality in the Region Hovedstaden.

Public evaluation Pr. 1.10.2016 Property value

DKK

334 000 000

Land value

DKK

45 344 000

Insurance The property is insured at Topdanmark under police no. 9361 969 810.

Annual insurance premium 2018 DKK 143 950 The insurance cannot be taken over by the buyer.

Water supply The property is supplied with water from the public water supply system.

11 NEWSEC EGESKOV & LINDQUIST

12  KORNMARKSVEJ 1

Heating As far as building 1, 2 and 3 are concerned, the property has central heating.

Building 4 has its own central heating system.

Building 9 has a heating pump.

Buildings 5, 6, 7 and 8 are not heated.

Energy label LOW CONSUMPTION

HIGH CONSUMPTION

OBH Ingeniørservice A/S has prepared an energy label on the building on March 7th, 2014. The energy label is valid for ten years, to the 7th of March 2024.

The energy-economic improvements suggested in the energy marking report are of lesser importance to the building’s owner and they would cost far more to establish than what would be profitable in terms of annual savings.

The energy label report conveys information about the energy consumption of the property and the possibilities of making improvements and achieving savings. The marking is mandatory, and it must be carried out by a certified company or an appointed energy consultant, approved with certification to allot energy markings to trade and service and public buildings.

Pollution According to the Ground Pollution report of 4.12.2017, a note has been made that the property cadastral no. 20 k Brøndbyvester By, Brøndbyvester has been mapped as possibly contaminated on knowledge level 1.

According to the Ground Pollution report of 4.12.2017 the Region Hovedstaden evaluates that there is no evidence to support a mapping examination for the property cadastral number 20 in Brøndbyvester By, Brøndbyvester.

An area is designated as mapped on knowledge level 1 (V1), if actual knowledge about activities which might have been a source of ground pollution on the area has been provided.

The property is situated in an area which is mapped as lightly polluted. Light pollution is pollution that exceeds a predefined level but does not go up to a level which necessitates a mapping as polluted.

OIL TANKS

On the property the following oil tanks are found: One 10 000-liter buried earth tank for heating gas/oil One 75 000-liter buried earth tank for heating gas/oil Both tanks have been emptied, dimmed, and refilled in 1991 13 NEWSEC EGESKOV & LINDQUIST

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15  NEWSEC EGESKOV & LINDQUIST

Public conditions and plans The property is registered in the district plan no. 212 for the commercial area Brøndby Nord.

The district plan divides the area into A1 – A6 and B and this property is located in the B area, which is for commercial use.

The area can only be used for commercial businesses, such as industrial businesses, workshops, trade and transport businesses, service businesses and their warehouses and offices.

No retail businesses, banks or other business with ordinary customer service may be established in the area. To a lesser extent, and if the municipality council permits it, service businesses to provide service the companies in the area may be established.

No businesses can be established without following the rules for the establishment of business stated in the zoning regulations and classification of businesses.

The property is situated in the zones for businesses of the classes 2-5, where the distance to residential areas must be Class 2

20 meters

Class 3

50 meters

Class 4

100 meters

Class 5

150 meters

16 KORNMARKSVEJ 1

Class 2 businesses have only insignificant influence on the close surroundings. They can be placed in areas with residential buildings. The businesses in the class are typically smaller businesses like bookbinders, electronics workshops, and laboratories.

Class 3 businesses are businesses which, as a result of their activities in outdoor areas (transport) have some influence on the close surroundings, but to a lesser extent. The businesses should be located in commercial areas, perhaps in the marginal areas, if the area is zoned, since the type of business will often be compatible with neighbouring areas that are sensitive to higher levels of pollution. Many workshop-like businesses and some service businesses belong to the class.

Class 4 comprises the less polluting of the production businesses. As a rule of thumb hey should be placed in actual commercial areas. Certain food manufacturers and some surface treatment businesses, for instance auto painters, are in this class.

Class 5 comprises the more polluting production businesses/factories, such as machine manufacturers, concrete factories and color and lacquering businesses.

Within the area transformer stations may be placed, if they are erected as” compact stations” with a placement agreed upon by NESA and the municipality council. No plot may be

plotted out on units smaller than 3 000 sq. m. and with a façade length of less than 35 meters.

Built on area

max

40% of the ground area

Volume

max

3 m³ pr. sq. m. ground area

Number of floors

max

3

Facade height

max

10 meter above ground level

Building height

max

15 meters above ground level

Area with planting and recreational areas

25% of the ground area

Parking

min. min.

1 parking space for every 45 sq. m. office area 1 parking space for every 60 sq. m. production or warehouse area

The district plan provides the opportunity of adding another 32 000 m², however the space would have to be added above ground floor level, because the building options at ground floor level have all been used and requires a permit from the municipality.

Easements/Declarations The following easements have been registered on the property:

Dato

Servitut

25.11.1949

Document regarding forfeit of compensation for damages caused by water level lowering.

03.12.1965

Document regarding water supply, sewage, private road, and certain other conditions

11.11.1971

Document regarding cables and transformer station

13.06.1972

Document regarding siding (no discontinuation before 31.01.1992)

17.07.1987

Supplementary text – Expropriation list regarding natural gas, cadastral 20i

18.05.1994

District plan 212

02.09.1996

Declaration regarding sewage pipe and related conditions regarding land register numbers 20k and 29dv

02.05.1997

Declaration regarding sewage pipe on cadastral 20k

23.07.1998

Declaration regarding water pipe on land register numbers 20k and 20dv

09.12.2005

Supplementary text – Doc. Regarding traffic regulations and rights registered on 20k and 29et

08.01.2009

Document regarding business lease between Kornmarksvej 1 A/S and DSV Road A/S 17 NEWSEC EGESKOV & LINDQUIST

THE TENANTS NILFISK A/S

Nilfisk is a Danish industrial company. From the very beginning they have had a vision of manufacturing and selling world class products of the best quality, worldwide. The company was founded in 1906. Initially, the company manufactured electronic motors. Over the years, the company developed new products, for instance vacuum cleaners, ventilators, sanders and even motorcycles (of the brand Nimbus). In 1910 the company had its big breakthrough, when the Nilfisk vacuum cleaner was invented. As the

vacuum cleaners underwent further development, the various other products dropped out of the product range.

The company has bought vacuum cleaner manufacturing companies and manufacturers of similar products over the years, primarily with focus on products for the professional market, for instance from Electrolux, Alto of Italy, Plataforma of Brazil, US products from the US and Viper from China, to mention just a few of the companies.

Today, Nilfisk offers an extensive range of premium cleaning products for private and commercial use, the primary Nilfisk product lines for floor maintenance, vacuum cleaners, and high-pressure cleaners, as well as a variety of vacuum cleaners and high- pressure cleaners designed for private consumers worldwide.

In the fall of 2017, the company has been singled out from NKT Holding as a separate, listed company, and it is listed on the Nasdaq Copenhagen Stock Exchange.

The company presently has its global headquarters at Kornmarksvej 1, Brøndby.

See more on www.nilfisk.com

KEY FIGURES

Profit million EUR

2016

2015

2014

2013

2012

1 058,5

980,0

917,6

880,7

871,2

EBITDA

96,8

98,0

120,2

104,4

99,8

EBIT

54,0

63,8

90,3

75,8

69,4

Yearly profit

29,5

41,8

58,1

45,2

40,3

Actives

983,1

935,5

862,3

802,2

819,8

Equity

224,8

200,7

334,8

286,6

266,1

14,6

12,9

17,6

17,5

16,9

5 607

5 545

5 420

5 321

5 224

Revenue

Balance

Return on equity (%) Full time employees at the end of the business year (pers.)

18  KORNMARKSVEJ 1

INTERVARE A/S (PARENT COMPANY OF NEMLIG.COM)

Since its foundation, the company has been one of the fastest growing enterprises in Denmark. Several times, it has been chosen as a gazelle-company by the newspaper Børsen, an award given to companies with continued growth (turnover at least doubled) over four years. As a result of the continued growth, the company is one of the largest Danish e-businesses.

Since its creation in 2010, nemlig.com, Denmark’s largest online grocery store, has developed and in the business year 2016/2017 it has had a turnover of more than 1 billion kroner, exclusively vie e-business.

Today, the company is owned by one of the wealthiest persons in Denmark, Troels Holck Povlsen, who also owns the clothing company Bestseller (with the brands Vero Moda, Jack and Joes and others). He has major shares in Zalando (Germany), Asos (UK) and others, and he has continually provided the necessary financing for further growth within the company.

The company employs around 300 persons, and it works with a very large number of subcontractors. For instance, the transportation provided by the delivery trucks is outsourced to independent transport companies.

In 2017, the company announced its interest in expanding its market to include the rest of Denmark (as opposed to just Zealand/the Copenhagen metropolitan area) in order to be operating nationwide.

See more on www.intervare.dk and www.nemlig.com

KEY FIGURES

Profit 1 000 EUR

2015/16

2014/15

2013/14

2012/13

2011/12

4 441,7

4 523,1

4 121,3

4 620,2

5 803,2

Operating profit (EBIT)

240,2

55,1

282,0

350,1

762,3

Yearly profit

128,2

47,4

226,1

237,0

559,3

Actives

49 713,7

34 898,3

28 968,4

8 570,8

9 251,4

Equity

35 179,9

21 623,2

21 575,8

3.343,7

3118,3

Solvency ratio (%)

70,8

62,0

74,5

39,2

33,7

Full time employees, average (pers.)

267

233

162

153

158

Gross profit

Balance

19 NEWSEC EGESKOV & LINDQUIST

INFORMATION REGARDING FINANCES Terms of sale Price: DKK 319 000 000, + dererred taxes of 17 mio DKK. The property is for sale as a share-deal.

20  KORNMARKSVEJ 1

RENT OVERVIEW

Tenant

Use

Nilfisk*

Warehouse

Area (sq. m.)

761 5 821

Office

863

Basement

1 002

Common area Compensation for premature termination of warehouse

8 447

Total Intervare

33 740

Warehouse

3 481

Office

300

Basement

1 153

Common area

38 674

Total

47 121

Total RENTAL TERMS

Tenant

Nilfisk A/S

Intervare A/S

Contract starts

1.8.2017

1.8.2017

Original contract made

15.12.2014

11.08.2014

Operating expenses – Tenant also pays other expenses towards the operation of the property

Yes

Yes

Heating and water - Tenant pays heating and water on account

Yes

Yes

Rent is paid

Monthly, in advance

Monthly, in advance

Deposit – Corresponding to (X) number of months’ rent

Cash 6 months’ rent

Bank guarantee 6 months’ rent

VAT – is added to rent, operation, heating, and water

Yes

Yes

The rent is regulated annually according to the net price index however

min. 2% / max 4%

NPI

Interminable by the tenant until

31.07.2022

31.12.2026

Interminable by the letter until

31.07.2028

31.12.2035

Tenant termination notice

12 months

6 months

Letter termination notice

12 months

12 months

Tenants earliest vacancy date

31.07.2023

30.06.2027

Cession

Yes

Yes

Subleased

Partially

Yes

Inside maintenance is responsibility of tenant

Yes

Yes

Outside maintenance is responsibility of letter

Yes

Yes

The property’s condition on take over

Partially as seen. The offices are refurbished pr. 1.10.2016.

Letter has paid 14 million DKK for refurbishing. A detailed description can be seen in the rental contract.

Partially as seen. Letter has paid 13,8 million DKK for furnishing. A detailed description can be seen in the rental contract.

The property’s condition on vacating

Refurbished

Same condition as upon take over. A detailed description can be seen in the rental contract.

Expenses for smaller changes on the buildings according to the wishes of the tenant and upon agreement with the letter are paid by

Tenant

Tenant

21 NEWSEC EGESKOV & LINDQUIST

The property is rented by the following tenant and the annual rental income per the 1st of January 2018 is: Area sq. m.

Annual rent pr. 2018

Rent pr. sq. m.

Deposita

Administration with warehouse

8 447

6 562 500

777

3 283 138

Intervare A/S

Warehouse with administration

38 674

13 501 728

349

Bank guarantee

TT Netværket

Antennae space

427

3 283 138

Tenant

Use

Nilfisk A/S

38 420

Total

47 121

20 102 648

Reserve for the renovation of heating installations

80 000

80 000

Rent of boiler room

22 500

22 500

100 000

100 000

Reserve for renovation of technical installations

20.305.148 Notes * Starting 01.10.2023 the rent will be reduced to DKK 5 336 973 = reduction of DKK 1 103 603

PROPERTY EXPENSES

The expenses carried by the owner in 2018 are:

3 643 000

100%

Net excl.

VAT 0

Other fees (water, renovation etc.)

25 000

100%

0

Subscription fee, owner’s association

20 000

100%

0

Electricity, gas and heating, common area

409 000

100%

0

Insurances

212 000

100%

0

Outdoor cleaning

800 000

100%

0

75 000

100%

0

0

100%

0

24 996

100%

0

100 000

100%

0

Expenses

Gross ex. VAT Tenant share

Land tax and coverage 2018

Other expenses Rent for boiler room Replacement reserves for heating installation Replacement reserves for technical installations Outside maintenance, building Replacement of technical installations Inside maintenance, building

30 DKK /sq. m.

47.121 sq. m.

1 413 630

0%

1 413 630

5 DKK /sq. m.

47.121 sq. m.

214 000

100%

0

15 DKK /sq. m.

47.121 sq. m.

700 000

100%

0

50 000

0%

50 000

Administration, estimated

7 686 626

Total expenses Paid by the tenant Paid by the landlord

132 DKK /sq. m.

6 222 996

31 DKK /sq. m.

1 463 630

Thus, the Net rent, if completely rented out, can be calculated as follows: NET RENT

Rent income incl. reserves, according to the tenant overview

DKK

20 305 148

Refusion on operation expenses

DKK

6 222 996

Refusion on heating expenses

DKK

2 872 500

The property’s heating expenses

DKK

-2 872 500

Property expenses

DKK

-7 661 630

Net rent without vacancy

DKK

18 842 518

22 KORNMARKSVEJ 1

1 463 630

INITIAL YIELD OF THE PROPERTY:

Net rent Sales price - cash deposit

x 100% = initial yield

DKK 18 842 518 x 100 DKK 319 000 000 - 3 283 138

= 6%

TAX DEPRECIATIONS

The company's annual depreciation is approximately DKK 15 million. See the latest annual report.

DEFERRED TAXES:

Also, the property can be obtained via the purchase of/ transfer of the shares in Catena Brøndby A/S, CVR. No. 30 92 60 80.

Deferred taxes per 31.12.2017 is informed to amount to around DKK 17 million.

The property, being the company’s only active, has, in the annual report for 2017, been valuated to around DKK 278 million in the annual report. The company equity is calculated to be around DKK 13 million per end 2017.

The latest annual report can be seen in the data room.

23 NEWSEC EGESKOV & LINDQUIST

24  KORNMARKSVEJ 1

25  NEWSEC EGESKOV & LINDQUIST

THE DANISH ECONOMY IS BOOMING The Danish economy continues to grow in 2018, with increased growth rate, new jobs, and an expectation of a strengthening of various investment activities. Interests are still at a low level. The Danish economy depends very much on internal as well as external factors. Especially the export activities to the countries around Denmark, such as Germany and Sweden, but also the US, are very important.

In the Eurozone, renewed optimism can be seen, after the French ties with the EU have been strengthened with the presidential election victory for Emmanual Macron, and Angela Merkel in all likelihood continuing as the chancellor of Germany. The economic growth in Europe is continuing and the Euro has been strengthened. The inflation, however, is lower compared to Denmark and the ECB has proclaimed that the rent will not go up before the purchase program has been finished, since the ECB director Mario Draghi is of the opinion that the improvement within the European economy is a result of the accommodative monetary politics. Several voices within the media landscape believe that it would definitely take a larger crisis for the progression in the EU to be shaken.

The Brexits influence on the financial markets, and the property market in the UK and the Eurozone, is still not very clear.

Thus, foreign investors show a greater interest in alternative investments in Scandinavia, including Denmark.

In the US, the labour market continues to be on the mend. In average 180 000 – 200 000 new jobs are currently created each month. The positive development in the American economy points towards interest rates continuing to increase.

Based on statements made in late 2017, up to three increases in interest rates are to be expected in 2018 as well as in 2019.

The oil prices experienced a significant drop in the period from 2014 to early 2016 and reached its lowest level of just 26 KORNMARKSVEJ 1

short of 31 dollars for a barrel in January 2016. The prices have since gone up significantly and the current level is at 60-65 dollars for a barrel. Increasing prices for oil are positive for the Danish economy and for the states income from the North Sea. ECONOMIC KEY FIGURES FOR DENMARK

The growth in GDP has been a surprise to many in the third quarter of 2017, with a small downgrade of -0,3%, and we now expect a growth of up to 2,0% in 2017. The Wise Men´s report suggests an annual growth rate of this level all the way towards 2025, provided that the financial politics are relatively strict. The growth is driven by an increase in gross investments and a small increase in private consumption.

The progress is also a result of many new jobs in 2016 and an expectation of over 40 000 new jobs in 2017. Unemployment stays at a low level of just above 4%. The positive numbers are in part a result of progress within building and construction, a business area which is very sensitive to cyclical fluctuations.

Denmark has had a surplus on the trade balance and on payments for many years. Since 2010, the surplus on payments has been between 6,5 and 8,5 percent of the Danish GDP. Thus, Denmark is actually one of the countries in the world with the largest surplus in percentages.

Interests are still low and that supports private consumption and investments within private housing and commercial properties.

The consumption of private households is expected to go up in 2018. There is still a potential for growth within private consumption due to the low consumption ratio and this is likely to have an effect in the second half of 2018.

glect their payments. Therefore, it is important that providers of loans, investors and loaners take precautions, to avoid losses in case interest rates go up.

Based on the booming economy and the rising prices of housing in the larger cities in Denmark, the director of the National Bank, Lars Rohde, and the financial Wise Men fear an overheating of the Danish economy, including bottleneck problems caused by a lack of qualified labour forces, especially within building and construction. There is also a fear regarding the risk taking of financial institutions and investors because the present view on risks is that they are quite small. They can suffer significant losses in case of higher interests and a possible setback in the development of the economy. Over the last few months we have seen an increase in loans given to businesses which have been known to ne-

We judge, that the strong economic developments in Denmark combined with the low interests, traditionally following the ECB interest rate level, provide a good foundation for a real estate market that continues to be attractive. As long as the low interest rates continue, the return on bonds is limited. This makes other investments more interesting to investors, in particular property investments, because they tend to provide a stable cash flow.

EMPLOYMENT, AGES 15-64 1000 persons

Personer i 1.000 2.850

2.800

2.750

2.700

2.650

2.600

2.550 Q1

Q2

Q3

Q4

Q1

2012

Q2

Q3

Q4

2013

Q1

Q2

Q3

Q4

Q1

2014

Q2

Q3

Q4

2015

Q1

Q2

Q3

Q4

Q1

2016

Q2

Q3

Q4

2017

Source: Danmarks Statistik Kilde / Source: Danmarks Statistik

LENDING RATE OF THE DANISH NATIONAL BANK, PERCENTAGES % 0,5 0,4 0,3 0,2 0,1 0

2012

2013

2014

2015

2016

2017

Source: Danmarks Nationalbank

THE MAIN POSTS OF THE NATIONAL BANK

Real growth in %

2012

2013

2014

2015

2016

2017* 2018*

Gross Domestic Product, GDP

0,2

0,9

1,6

1,6

2,0

2,2

2,1

Import of goods and services

2,8

1,4

3,9

1,9

3,8

2,4

3,0

Export of goods and services

1,3

1,6

3,1

2,4

2,9

3,7

2,4

Private consumption expenditure

0,4

0,4

1,0

1,7

2,3

2,3

2,2

Public consumption expenditure

0,8

-0,1

1,9

1,1

0,3

0,9

0,8

Gross fixed capital formation

3,7

2,7

3,1

3,1

6,0

2,1

4,1

Source: Danmarks Nationalbank

27  NEWSEC EGESKOV & LINDQUIST

CREDIT SYSTEM Mortgage Credit Borrowing Limits: MORTGAGE CREDIT IS THE MOST COMMON

form of real estate finance in Denmark. Bonds for the financing of a mortgage loan are considered as a safe investment and this, combined with a very stable economy, means that mortgage credit loans are available at attractive rates in Denmark. The Danish mortgage credit system is unique because it is built up around a fundamental basic principle, namely, a direct connection between the loan, which the homeowner takes out with the mortgage credit institution, and the bond, which the institution issues in order to finance the loan. This one to-one connection between a loan and a specific bond has always been the cornerstone of the Danish mortgage credit system, which dates right back to 1795.

The Danish mortgage credit system has achieved widespread recognition in both Denmark and abroad. Over the decades, researchers and rating bureaus have characterised the Danish mortgage credit system as nothing less than "the world's home financing system".

Mortgage credit loans are available at low rates in Denmark, where there is also a large product selection and effective competition, even if it can seem limited at present. In general, there is transparency in products and prices and, when it pays to do so, borrowers have the opportunity to restructure their loan quickly in relation to interest rate development.

The three most popular mortgage loans, measured by total lending, are re-setter loans with no-payment period, re-setter loans without no-payment period, and fixed rate loans without no-repayment period. Re-setter loans were introduced in 1996 and quickly became the most popular type of loan in the Danish mortgage credit market.

The total volume of Danish property bonds amount to approx. DKK 2.672 bn. by the end of 2017.

MORTGAGE CREDIT BORROWING LIMITS

Property Category

Borrowing Limit %

Maximum Maturity in Years

Office property

60

30

Industry and logistics property

60

30

Retail property

60

30

Residential property

80

30

Housing corporation

80

30

Public housing - New build

84

30/40

Public housing - Exisiting

80

30

Vacant sites

40

30

Holiday homes

60

20

Source: RealkreditrĂĽdet

28  KORNMARKSVEJ 1

29  NEWSEC EGESKOV & LINDQUIST

30  KORNMARKSVEJ 1

TAKEOVER

The takeover of the property happens according to agreement.

The property will be taken over as a company transaction.

APPENDIXES

The reader is referred to the property portfolio computer room.

Please contact Newsec Egeskov & Lindquist A/S for access.

RESERVATIONS

This prospect is based on data from public sources and information received from the client.

It is the opinion of Newsec Egeskov & Lindquist that the information provided is correct and adequate, but no responsibility is taken in terms of mistakes or omissions.

VIEWINGS

All inquiries regarding the property, such as viewings, are, according to the agreement with the client, to be made to: REGITZE LUND Associated partner, senior advisor MRICS, real estate agent, valuer, MDE Dir.: +45 28 94 81 44 regitze.lund@newsec.dk HENRIK LYNGSKJOLD

Adm. Director, senior partner MRICS, cand. merc, real estate agent, MDE Dir.: +45 26 12 13 90 henrik.lyngskjold@newsec.dk

DISLCAIMER: This investment memorandum is based on the collection and calculation of data from various market players and databases in the Danish real estate market as well as information from the present owner.

Newsec Egeskov & Lindquist A/S disclaim any responsibility for the accuracy of information in the reproduction. Newsec Egeskov & Lindquist A/S may at no time be legally or financially responsible for the accuracy of the content or loss of any kind suffered from the use of data from this market report.

Information is purely indicative and is disclosed without responsibility for Newsec Egeskov & Lindquist. It is recommended that consultants seek professional advice in regards to property investments, real estate transactions, valuation, etc.

31  NEWSEC EGESKOV & LINDQUIST

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