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  • Fund & Asset Manager Rating Group Germany  Credit Analysis  SEB Immoinvest REP  Summary  Fitch Ratings has assigned a Real Estate Portfolio score of ‘REP3+’ to SEB Immoinvest (ImmoInvest), a German open‐ended real estate fund managed by SEB Investment GmbH (SEB GmbH). The ‘REP3+’ score is the result of the analysis of the fund Fitch carries out annually according to its REP methodology, which is explained in detailed in Fitch’s criteria report titled “Real Estate Funds – Analysis Explained”, available at the agency’s website at www.fitchratings.com . The analysis is based on the fund’s composition as of 31 March 2008. Any property purchases or disposals after that date are not reflected in this report. Analysts  Dr. Gabriele Herbst The ‘REP3+’ score reflects the resilience of a real estate fund on a total equity +49 69 768076 260 return and property‐level return basis after exposure to a hypothetical stressed gabriele.herbst@fitchratings.com environment consistent with a major recession. The final score is a weighting Uli Maute between two returns; the total equity return accounts for one‐third and the +49 69 768076 238 uli.maute@fitchratings.com property‐level return accounts for the remaining two‐thirds of the score. It is therefore dependent upon the quality of the fund’s real estate portfolio and the Stefan Baatz strength of its financial structure. +44 20 7070 5838 stefan.baatz@fitchratings.com When analysing a real estate fund’s resilience on a total equity return and property Company Contact returns basis, Fitch applies stresses to each property, tenant and lease to simulate Renate Hessenauer stressed cash flows and property values. The resulting stressed property values and +49 69 27299 1607 renate.hessenauer@sebam.de cash flows are applied to the fund’s accounts to quantify the impact on the fund’s total equity return, i.e. its total return to investors. Based on the fund’s composition as at 31 March 2008, ImmoInvest has achieved a ‘REP3+’ or ‘Resilient’ score. This means that the underlying characteristics of its real estate portfolio and financial structure are such that the fund is expected to exhibit as resilient a performance as the agency’s sample of funds in terms of total equity return and property values in an adverse economic environment. The ‘REP3+’ score was assigned upon ImmoInvest’s composition in March 2008. This is the result of a considerable decline in the real estate portfolio value simulated by Fitch based on the agency’s recession assumptions, the degree of geographical, tenant and property type diversification of the fund and the low leverage of the capital structure. Like other German funds, ImmoInvest has little debt and no net leverage (i.e. the amount of liquidity exceeds the fund’s debt). The portfolio also benefits from a large number of tenants and a relatively long unexpired lease term. ImmoInvest’s portfolio of assets comprises 132 properties with a total value of EUR6.6bn; 46.2% by portfolio value is located across Germany, 12.3% in France, 9.2% in Italy, 8.4% in the US and 7.1% in the Netherlands. The remaining 16.8% is spread across nine other European and three Asian countries. In 2007/2008, ImmoInvest made its first investments in Finland, the Czech Republic, Japan and Singapore. The portfolio consists predominantly of offices (71.7% by market value) and retail assets (11.2%). The major changes in the fund’s composition since Fitch’s last analysis are the decreased liquidity positions that add up to EUR1.57bn (22.5% of the fund’s assets compared to 42.4% the year before), the increased share of German assets (46% of portfolio value vs. 40.2% the year before) and the addition of four properties located in Asia (three in Japan and one in Singapore). The drop in liquidity was caused by a substantial net property investment volume of EUR1.81bn (EUR2.28bn of new acquisitions ‐ measured by purchase price paid incl. cost ‐ compared to  SEB Immoinvest REP February 2009  1 
  • Fund & Asset Manager Rating Group EUR0.47bn of property disposals). This amount includes the purchase of the Quartier am Potsdamer Platz site in Berlin, Germany for about EUR1.4bn ‐ significantly increasing the regional concentration of the fund in this region. SEB GmbH’s investment strategy focuses on high‐quality real estate assets in prime locations and good secondary locations across Europe, the US and – since 2006 – Asia. The ‘REP3+’ or ‘Resilient’ score’ compares to the ‘REP2’ or ‘More Resilient’ score’ achieved by the fund the year before. The associated decrease in resilience is mainly attributed to the following factors, with the first having the most significant impact: (1) In 2008, the fund significantly increased its regional concentration in Berlin, Germany (about 27% by property value). Such a high regional concentration is generally associated with a higher return risk of the real estate assets, and thus a lower resilience to regional property market downturns; (2) The fund’s liquidity ratio dropped to 22.5% from 42.4% in 2007 due to large net property investments made in 2008 (EUR1.81bn), thereby bringing its share of real estate assets to the envisaged 80%. While the higher ratio of real estate assets increases the fund’s yield, it also means a higher exposure to real estate market downturns and hence a potentially higher volatility of the fund’s equity returns; and (3) More lease agreements expire in the foreseeable future, which also adds pressure on the property income in a stressed economic environment.  Highlights · Significant increase in real estate assets held by the fund due to high net investment. · With 132 properties in 17 different countries, ImmoInvest continues to benefit from a highly diversified portfolio. In 2008, the fund made investments in eight different countries, making its first investments in Finland, the Czech Republic, Japan and Singapore. · However, the fund materially increased its regional concentration in Berlin/Germany by acquiring the Quartier am Potsdamer Platz site, a well‐ known property complex in the centre of Berlin. · Increased diversification in terms of tenant industry and number of tenants. · Relatively long weighted‐average unexpired lease term of 6.5 years, but comparatively high share of leases expiring in 2008 and 2009 of 18.2% (vs. only 9.5% the year before). · Sharp decline of liquidity levels. · Nine investment firms managing regulated open‐ended real estate funds in Germany ‐ including SEB ImmoInvest ‐ reportedly suspended all share redemptions in one or several of their funds due to fears over further cash outflows from investors. · Low leveraged financial structure with no net debt. · Clearly defined investment strategy.  Fund Profile  ImmoInvest is an open‐ended real estate fund managed by SEB GmbH and launched in 1989. Open‐ended funds are unit trusts that can be bought or sold on a daily basis. SEB GmbH is a wholly owned subsidiary of SEB AG, rated ‘A+/F1’ (the fund does not directly benefit from its parent’s rating). It was initially set up with a German investment focus but has been expanding into Europe since 1995, into the US since 1997, and also into Asia since 2006. ImmoInvest has been set up as an income fund with a focus on long‐term sustainable cash flows, while growth in the underlying value of the property portfolio is considered a plus. SEB Immoinvest REP February 2009  2 
  • Fund & Asset Manager Rating Group Investment Strategy  SEB GmbH’s investment strategy for ImmoInvest is to seek sustainable cash flows, focusing on rental income rather than capital gains. To achieve this, SEB GmbH targets high‐quality real estate assets that are located in both prime and good secondary locations, rather than investing solely in “trophy buildings” in prime locations. The reason for this strategy is that secondary locations have historically displayed a less volatile performance. As with other German open‐ended funds, development projects are rarely included. As at financial year‐end 31 March 2008, there were no properties under construction in the portfolio. In line with the company’s stated strategy, sustainability of income is a major concern in all of ImmoInvest’s investment decisions. When new real estate acquisitions are considered, their effect on cash flow is analysed using a financial model that also focuses on the lease’s expiry date to prevent large void periods in the cash flow. The results flow through into further analysis of the potential impact on the fund’s financial statements. The investment teams are organised by geographic region. The investment opportunities are not just obtained via agencies, but also through direct contact with large real estate investors globally. ImmoInvest, which has substantial assets under management, is contacted directly for many transactions. However, it is a challenge for a German‐based investor to gain access to off‐market deals or deal‐ related information on transactions in regions such as Asia and the US. The fund carries out an in‐depth valuation analysis for any new acquisition. This includes detailed research of the investment and occupational market, and cash flow valuations with various types of sensitivity testing. The fund uses a robust cash flow model based on international methods, which includes vacancy forecasts, rents and detailed charges. In addition to SEB’s own valuation analysis, the law governing the funds requires an independent valuation to be performed by independent experts (supervised by the German Federal Financial Supervisory Authority, BaFin), and SEB is not permitted to acquire properties at a price above the independent valuation price. The approved asset allocation strategy is 80% real estate assets and 20% liquidity; 70% office and 30% other asset classes; and 40% German and 60% non‐German investments. In 2008, the fund had almost achieved all of these target rates.  Financial Structure  German open‐ended real estate funds are usually characterised by high liquidity and low debt levels, i.e. the absence of net debt. As at 31 March 2008, ImmoInvest held EUR1.57bn in liquid assets – or 42% below the EUR2.7bn reported a year earlier – but is pretty much in line with the funds’ target liquidity ratio. As at 31 March 2008, ImmoInvest still had not incurred any net debt. German law allows these funds to take on debt equivalent to up to 50% of the market value of their real estate assets. However, the changes in available liquidity are generally linked to the fund’s limited ability to control liquidity inflows and outflows. This is a general problem for German open‐ended real estate funds that became obvious in October 2008. Until end September 2008, almost all German open‐ended real estate funds reported massive cash inflows (about EUR5bn altogether). However, in October, the general strain on liquidity in the financial markets coupled with the German government's move to guarantee all bank deposits has triggered high cash outflows of these funds. Although the German government revised its framework for open‐ended real estate funds in December 2007 and various self‐imposed guidelines were adopted by the industry, the current situation highlights that the structural liquidity mismatch that characterises the industry is ultimately difficult to circumvent during times of crisis. SEB Immoinvest REP February 2009  3 
  • Fund & Asset Manager Rating Group Nine investment firms managing regulated open‐ended real estate funds in Germany ‐ including SEB ImmoInvest ‐ reportedly suspended all share redemptions in one or several of their funds. While the suspension ensures protection and fair treatment of investors, the underlying concerns about the strain on liquidity ratios and real estate prices are likely to persist beyond the suspension period that has just been extended from three Balance Sheet Data  A s o f financial year end M arc h 2008  to 12 month by many funds. SEB ImmoInvest also indicated the extension (EUR bn)  M ar 07  M ar 08  of the share suspension period. The 7  6.57  impact on SEB ImmoInvest in the event 6  it should be forced to sell when the 5  4.24  fund re‐opens will warrant heightened 4  2.7  surveillance. For more details on the 3  1.57  topic of liquidity management, please 2  0.99  1.04  see the special report, "Open‐Ended 1  Real Estate Funds ‐ Challenges for 0  R eal estate ass ets  Liquid ass ets  D ebts *  Liquidity Management" issued on 30 June 2008 (available at * Includes liabilities and pro visio ns  So urc e: SEB  Immo lnves t as  o f financ ial year end M arch 2008 www.fitchratings.com). Nevertheless, the fund’s long track record and financial strength ensure that it has easy access to banking loans, if necessary; furthermore, SEB AG is one of its major business partners and could provide financing if needed. Liquidity assets are held in a special investment fund called SEB Immo Cash that was launched by SEB Invest GmbH in 2006. The fund invests in short‐term securities, with an average duration of 0.16 years as at March 2008. At that time, 89.2% of ImmoInvest’s liquidity was invested in this special fund, and the remainder in daily available bank deposits. A risk control system has been developed to keep losses to a minimum and guarantee that the value of the securities does not fall below par. Major Changes in the Property Portfolio Since the 2007 Assessment Usually, the composition of large German real estate funds does not change considerably over short periods. This is plausible, since the fund’s intention is to make long‐term investments in properties that generate stable cash flows rather than making profits by trading real estate on a short‐term basis. However, in the period under analysis unusually high changes in the portfolio composition could be observed. In the period under analysis, the fund made net property investments of EUR1.81bn, thereby bringing its share of real estate assets closer to the envisaged 80%. Thus, the volume of the assets under management increased to EUR6.57bn (by value). The number of assets under management increased to 132, as ImmoInvest both sold 26 and acquired 36 properties. 40 of the 132 properties with an aggregate value of EUR2.97bn are held indirectly via property companies. Country Distribution The largest geographical concentrations (by country) are in Germany 46.2%; France 12.3%; Italy 9.2%; the United States (US) 8.4%; the Netherlands 7.1%; other European countries 7.6% and Asia 9.2%. Germany represents the largest proportion currently above the 40% target rate envisaged by ImmoInvest’s asset allocation strategy. However, the German real estate market outperformed other markets such as the US or France during the current property downturn with capital values declining to a lesser extent. The UK, one of the largest real estate markets in Europe and worst affected by the current property downturn, is not represented in the pool.  SEB Immoinvest REP February 2009  4 
  • Fund & Asset Manager Rating Group Country Distribution by Value As of year end March 2008 (%) Mar 07 Mar 08 50 40 30 20 10 0 Germany USA France Italy Netherlands Asia Others Source: SEB Immonvest The country distribution compared to last year’s composition is as follows: The share of US properties decreased to 8.4% of the fund’s value (from 12.4% in 2007). This change is neither caused by new acquisitions nor by disposals. It rather relates to the high net volume of property investments ImmoInvest made in other countries. This also explains the decreased share of properties in France and Italy (by value). Asian properties make up 9.2% of ImmoInvest by volume. In 2008, the fund increased its investment volume in the Asian real estate market by purchasing a EUR253.6m office property in the city centre of Singapore (3.9% by value) and three office properties in Japan. The latter are located in Tokyo, Osaka and Tama and together account for 3.0% of the fund by value. This also enhanced the funds’ international diversification. The share of German assets increased by 6%, mainly because of the purchase of Quartier am Potsdamer Platz in Berlin (see Property Description below) for about EUR1.4bn, which accounts for almost 60% of the new investments made in 2008. This caused a significant regional concentration in Berlin, where 24 of the 61 German properties are situated, which account for about 60% of the cumulative value of all German properties (compared to 16.7% in 2007). Regional Distribution in Germany By Value (%) Mar 07 Mar 08 60 50 40 30 20 10 0 Berlin Rhine‐main Rhine‐ruhr Hamburg Munich Other Source: SEB Immonvest as of financial year end 2007 and 2008 Besides Germany, the fund invested in eight different countries, making its first investments in Finland, the Czech Republic, Japan and Singapore and thus advancing its international diversification. SEB Immoinvest REP February 2009  5 
  • Fund & Asset Manager Rating Group New Acquisitions by Country and Disposals by Country and Value Value Finland Spain Austria Poland 1.0% 9% Spain 1.9% 1.8% 0.04% Czech Republic 3.2% Netherlands 7.3% Germany Japan 65.5% Germany 8.5% 91% Singapore 10.8% Source: SEB ImmoInvest as of financial year end Source: SEB ImmoInvest as of financial year end March 2008 March 2008 Use Type Distribution By use type, the portfolio is concentrated in offices, which represent 71.7% by income, retail (11.2%), industrial (2.9%), car parking (4.6%), hotels (4.0%) and other (5.6%). Despite the relatively high concentration in offices – which is considered to be more volatile than other property types – this distribution is not atypical for German open‐ended real estate funds. And it is in line with ImmoInvest’s targeted asset allocation.  Use Type Distribution by Rental Use Type Distribution by Rental Income Income  Industrial Other M ar 07  M ar 08  (%)  2.9% 5.6% Hotel 80  4.0% Parking 60  4.6% 40  Retail Office 11.2% 20  71.7% 0  Office  Retail  P arking  Ho tel  Others  Source: SEB ImmoInvest as of financial year end So urce: SEB  Immo lnvest as o f financial year end  March 2008 M arch 2008  A large share of the disposed assets were office properties, but the share of office properties in the portfolio did not decrease, as almost all of the acquisitions also fell into this category. Office properties are generally more volatile than, for example, retail properties and Fitch considers the high share of office properties and the fund’s resulting low diversification by use type as less advantageous. Tenant and Tenant Industry Distribution The portfolio benefits from a sound tenant distribution, with moderate Five Largest Tenants concentration from the 10 largest Share of total rental tenants, which contribute 22.8% of (%) income current passing rent. ENI S.p.A. 3.1 Maritim Hotelgesellschaft 2.6 Moreover, the portfolio’s tenant mbH industry distribution is very good Daimler Financial Services AG 3.1 and even slightly improved PricewaterhouseCoopers 2.9 NBC Universal, Inc. 1.6 compared to last year with only Total of five largest tenants 13.3 some concentration in consumer Source: SEB ImmoInvest as of financial year end March 2008 goods contributing 12.2% of income. SEB Immoinvest REP February 2009  6 
  • Fund & Asset Manager Rating Group Distribution of Income by Other significant industry types are financial institutions (10.7%), accountancy/ legal/management consulting firms (9.9%), technology companies (8.9%), hotels and Industry catering (7.6%), or technology and software companies (7.8%). Fitch takes a Share of total rental favourable view of this industry diversity among the tenants. Industry type income (%) Consumer goods 12.2 Distribution of Rental Income by Tenant Industry Financial institutions 10.7 As of financial year end March 2008 Accountancy/legal/man 9.9 (%) Mar 07 Mar 08 agement consulting firms 16 14 Hotel and catering 7.6 12 Technology and 7.4 10 8 software 6 Automotive and 7.4 4 transport 2 0 Telecommunications 6.2 Consumer Account Technology & Financial Telecommuni‐Engineering Media & Hotels & Automotive & Engineering 5.3 goods ancy/ software institutions cations entertain catering transport Construction 5.3 legal ment Media and 4.5 entertainment Source: SEB Immolnvest Public authorities 4.3 Others 19.2 Total 100.0 Lease Profile Source: SEB ImmoInvest as of financial year The portfolio contains more than 2,600 leases (excluding car parking). The end March 2008 weighted average unexpired lease term of the property portfolio is 6.5 years (unchanged to last year), which is viewed positively given that lease terms tend to be shorter in continental European countries. The chart below shows the lease expiry profile. The share of leases expiring in 2008 and 2009 is 18.2% which represents a significant increase compared to 9.5% of leases that were expiring in 2007 and 2008 (by passing rent). Generally, more evenly spread lease expiries lead to smoother and more sustainable cash flows. Lease Expiry Profile by Rental Income (%) 14 12 10 8 6 4 2 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018+ Unlimited Source: SEB ImmoInvest as of financial year end March 2008 The portfolio had a 7.9% vacancy rate by estimated rental values at financial year‐ end 2008, which reflects an increase of 0.8 percentage points from 2007. Top five properties The five largest single real estate assets account for 16.0% of the portfolio by value. The main characteristics of these are summarised below. As mentioned earlier, in December 2007 the fund acquired the Quartier am Potsdamer Platz, a building complex comprising a total of 19 properties that together account for 22.8% of the whole property portfolio by value. Quartier am Potsdamer Platz, Berlin, Germany Quartier am Potsdamer Platz consists of 19 properties with a total lettable area of approximately 287,000sq m. This site is part of the larger Potsdamer Platz development erected in the 1990s. It consists of offices, retail space, residential units and two hotels (Grand Hyatt and Mandala) as well as entertainment facilities (musical theatre, casino, cinema) and a shopping arcade (Potsdamer Platz Arcades). SEB Immoinvest REP February 2009  7 
  • Fund & Asset Manager Rating Group The whole site is almost 93.0% let with an average remaining lease term of 6.1 years and a broad tenant base anchored by well known German and international corporates. Each of the 19 properties is held indirectly, but is owned 99.99% by the fund. The largest two assets are described below: · Marlene‐Dietrich Platz 5, Berlin, Germany The property is currently fully let to three tenants. The major tenant, Daimler Financial Services AG, accounts for 98.8% of the passing rent with the lease agreements expiring end of 2012. Vodafone and Berliner Festspiele GmbH account for the remaining 1.2%. · Potsdamer Platz 1, Berlin, Germany The property mainly offers office space, but also includes some retail units, restaurants and storage space. It is currently 83.7% let to 12 tenants comprising Daimler Financial Services AG, Freshfields Bruckhaus Deringer, EADS Deutsch‐ land GmbH, Hogan & Hartson LL and Maredo Gaststaetten. 77 Robinson Road, CBD, Singapore ImmoInvest acquired 77 Robinson Road in May 2007. The property is held indirectly, but fully owned by the fund. It is a high‐quality, 35‐storey building that offers about 27,450sq m of office space and 180 parking spaces. It is located in Singapore’s central business district (CBD) and is currently 90.8% let to 36 tenants. The three largest tenants account for about 30% of the properties’ current passing rent. They comprise Rajak Tann (with 16.5%), Michelin Asia Pacific (8.4%) and Travelex Singapore (6.6%) with lease terms expiring in 2009 (Michelin) and 2010 (both Rajan Tann and Travelex). 65 Rue de Camille Desmoulins, Issy‐les‐Moulineaux, Greater Paris, France The property is held indirectly, but is almost fully owned by the fund. It was built in 2002 to high specifications. The location is a relatively new but established office area outside central Paris. The tenants represent many industries, with some concentration in telecommunications, media and high‐tech companies. The property is mainly let to Wavecom, NDS Technologies and Unilocations, with lease terms expiring in 2011 and 2013 (both NDS and Unilocations). The property is slightly over‐rented. Stauffenbergstr. 26, Berlin, Germany The property is a four‐star congress hotel completed and acquired by ImmoInvest in August 2005. The hotel has 505 rooms, including 71 suites, and has the capacity to handle congresses and other events involving up to 5,800 people. It is located close to several tourist sights such as the German Reichstag and the Brandenburger Tor. The whole building is let to Maritim Hotelgesellschaft mbH (Maritim) until 2030. Maritim is one of Germany’s leading hotel chains, operating 50 hotels with more than 14,700 rooms. Especially in the conference hotel segment, Maritim has a leading role in Germany.  Fund Analysis  In its analysis, Fitch assesses the resilience of returns in a major stress scenario that relates to a major recession. Fitch analysed the fund in two stages. The property value and income resilience were tested using Fitch’s European CMBS asset model. The cash flows and values of the property portfolio were stressed in an environment similar to a major recession. This analysis provided the inputs for the second stage of the analysis, in which the financial structure (the statement of assets and the statement of income and expenditure) was analysed. Stressed cash flows and property values obtained from the asset model were applied to the fund’s accounts and were used to calculate income and capital returns, which were then combined to form the stressed total SEB Immoinvest REP February 2009  8 
  • Fund & Asset Manager Rating Group equity return. The stressed property value and the stressed total equity return were weighted to obtain an overall score. The eventual score determined the REP score for the fund, which is separated into five categories, ‘1’ being the most resilient, and ‘5’ being the least resilient (see Appendix). The detailed methodology for each stage of analysis is described below. Property Value Return – Model As mentioned above, Fitch analysed the fund using its CMBS asset model. The model is a Monte Carlo simulation of property cash flows, generated by aggregating the flows projected for each unit. Tenant defaults ‐ simulated through Fitch's default model ‐ depend on credit ratings and industry/geographical correlation assumptions, and lease renewal probabilities depend on the lease standards for each market. Tens of thousands of iterations are carried out to produce a range of possible scenarios at both unit and property level. The projected property income provides the basis for the valuation of the property. For further information on the agency’s asset modelling methodology, please see the report titled “Criteria for European CMBS Asset Analysis”, dated 12 September 2007 and available on the agency’s website at www.fitchratings.com. Stressed Total Equity Return · Two outputs from the asset model – stressed income and property values – are entered into the financial statements of a fund to make a forward projection for a stress year. · Stressed total equity return takes into account the fund’s capital structure and its effects on return. Non‐real‐estate assets are usually invested in short‐term cash or investment‐grade instruments, so the stress applied to these assets is very small or nil. · The main element stressed in the balance sheet is property value. Therefore the smaller the proportion of real estate assets, the lower the impact of the stress scenario on total return. The leverage on the portfolio is also reflected in total return. If more leverage is present, the impact on total stressed return is higher. · A stressed capital return and income return are obtained from this analysis. These two are combined to form a stressed total equity return for the fund. Weighted Assessment · The two‐stage analysis yields two results; a stressed total equity return and a stressed property value return. The final score is a weighting between the two stressed returns; the total equity return accounts for one‐third and the property‐level return accounts for the remaining two‐thirds of the score. · This weighting best suited Fitch’s view that the score should give a unit holder a sense of the short‐term and long‐term risks in the portfolio. Although the total stressed return is the most likely return to be achieved if the given stress occurs immediately, it does not fully reflect the potential long‐term risk of the pool, especially if the fund is still benefiting from holding a relatively high percentage of cash‐equivalent assets. Since it is the fund’s objective to more fully invest in real estate, the property value return is a more realistic projected long‐term return for it. However, this does not reflect the current capital structure of a fund. By weighting the results as indicated, the overall score gives a better reflection of a fund’s short‐term and long‐term risk. SEB Immoinvest REP February 2009  9 
  • Fund & Asset Manager Rating Group Results  According to Fitch’s analysis, ImmoInvest performed relatively well in both property return and stressed total equity return. The property return portion of the score is ‘3’ Resilient. Given the well‐diversified portfolio and relatively long remaining lease terms, the stressed results were in line with the agency’s sample of funds. On a stressed total equity return basis, the overall portfolio (including all assets and liabilities) performed better, and was classified as ‘2’ More Resilient. This was aided by the funds’ relatively large – albeit reduced ‐ cash position, which is usually invested in less volatile assets. Over the past year, the cash position has been significantly reduced. Although this is generally in line with the fund’s objectives, it increased the fund’s potential return volatility. The weighted assessment for ImmoInvest indicates that, relative to its peer group – a small number of European real estate funds – Fitch expects it to have resilient returns in a stress scenario similar to the last recession. This leads to a score of ‘REP3+’ – thus indicating that the resilience of the fund is still assessed as being above average but less than 2007. This result compares to a ‘REP 2’ More Resilient score in 2007, with a property return portion of the score of ‘2‐’ More Resilient and a total equity return portion of ‘2’ More Resilient. The reduced degree of resilience can mainly be explained with the higher regional concentration, lower liquidity ratios and a shortened lease profile as pointed out earlier in this report. To account for the current strain on liquidity of German open‐ended real estate funds (see paragraph on Financial Structure above) a ceteris paribus analysis has been carried out to analyse the sensitivity of the fund’s resilience regarding further cash outflows. A theoretical cash outflow that brings the liquidity ratio almost down to the legal minimum of 5% would lead to a total equity return of ‘4+’ Less Resilient (everything else remaining unchanged). This drop in liquidity would relate to an overall REP score of ‘3’ Resilient.  Performance Analytics  Fitch will monitor the fund on an annual basis and as warranted by significant events. The agency’s analytical team ensures that the assigned scores remain, in the agency’s view, an appropriate reflection of its score. Details of the transaction’s performance are available at www.fitch‐makler.de and www.fitchratings.com. Further information on this service is available at www.fitchratings.com. Please call the Fitch analysts listed on the first page of this report for any queries regarding the analysis or the ongoing surveillance. SEB Immoinvest REP February 2009  10 
  • Fund & Asset Manager Rating Group Appendix  Real Estate Portfolio (REP) Score Definitions The score is an assessment of the resilience of a real estate fund on a total equity return and property value return basis after exposure to a hypothetical stressed environment similar to a significant recession. It is an indication of a fund’s potential relative vulnerability to a property recession given the quality of its real estate portfolio and capital structure. The score does not opine on the management quality of the fund nor does it imply a fund’s immunity from loss in significant stresses. The score does not provide a measure of potential investment return or suitability. The score is derived via the use of a potential stress on a portfolio and measures mainly downside risk. Through the use of a Fitch cash flow model, a real estate fund’s property cash flows and values are generated and subjected to a stress equivalent to a major property recession (in many cases similar to the one that occurred between 1989 and 1994). The results are analysed to determine a stressed property‐level return; they are also fed into a model replicating the fund’s current capital structure to generate hypothetical stressed total equity returns. The final score is a weighting between the two returns, which is placed into five potential categories (listed below). Most Resilient (REP Score 1) This category denotes a high expectation of a fund’s portfolio to minimise losses given a significant stress event. This category is only assigned in cases where funds display an exceptional capacity to keep losses on a total equity and property return basis to a relative minimum; however, it does not imply that a loss would not occur. Funds in this category usually exhibit good overall property and geographical diversification, a high percentage of low‐volatility property types or leases, and may also have a high percentage of cash‐equivalent assets and/or low debt levels. More Resilient (REP Score 2) This category denotes a reasonable expectation of the capacity of a fund’s portfolio to minimise losses given a significant stress event. This category is assigned in cases where funds display a high capacity to keep losses on a total equity and property return basis to a relative minimum; however, it does not imply that a loss would not occur. Funds in this category usually exhibit better‐than‐average portfolio diversification and/or less volatile property types and leases. Their capital structure may also benefit from lower‐than‐average levels of debt or higher‐than‐ average levels of liquidity. Resilient (REP Score 3) This category denotes an average expectation of the capacity of a fund’s portfolio to minimise losses given a significant stress event. This category is assigned in cases where funds display an average capacity to keep losses on a total equity and property return basis to a relative minimum; however, it does not imply that a loss would not occur – rather, that such losses should be consistent with industry averages. Less Resilient (REP Score 4) This category denotes a less‐than‐average expectation of the capacity of a fund’s portfolio to minimise losses given a significant stress event. This category is assigned where funds display a lower‐than‐average capacity to keep losses on a total equity and property return basis to a relative minimum. Funds in this category will usually exhibit more volatile property types or lease structures, higher levels of debt, or less portfolio diversification; therefore, losses could be higher than the industry average. SEB Immoinvest REP February 2009  11 
  • Fund & Asset Manager Rating Group Least Resilient (REP Score 5) This category denotes the lowest expectation of the capacity of a fund’s portfolio to minimise losses given a significant stress event. This category is assigned where the funds are expected to have a minimal capacity to keep losses on a total equity and property return basis to a relative minimum. Funds in this category will usually exhibit more volatile property types or lease structures, higher levels of debt, or less portfolio diversification; thus, losses could be much higher than the industry average. Modifiers – i.e.: pluses (+) or minuses (‐) can be appended to the scores from ‘2’ to ‘4’ to differentiate funds within the same score category. A plus ‘(+)’ will mean that the fund was slightly more resilient than a typical fund in its category. A minus ‘(‐)’ will mean that the fund was slightly less resilient than the typical fund within its category. Note: certain REP scores may benefit from high concentrations of cash‐equivalent investments. Virtually all funds plan to fully invest their cash in property or property‐related investments. This characteristic is considered when determining a fund’s final REP score, and more weighting is applied to the property return portion of the results. In the short run, a significant stress event in a fund will cause overall returns to be closer to the total equity return because it takes into account the fund’s current capital structure; however, in the long run, significant stresses should more closely resemble property‐level returns as more of the cash assets are expected to be invested in property‐related investments. Copyright © 2009 by Fitch, Inc., Fitch Ratings Ltd. and its subsidiaries. One State Street Plaza, NY, NY 10004.Telephone: 1‐800‐753‐4824, (212) 908‐0500. Fax: (212) 480‐4435. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved. All of the information contained herein is based on information obtained from issuers, other obligors, underwriters, and other sources which Fitch believes to be reliable. Fitch does not audit or verify the truth or accuracy of any such information. As a result, the information in this report is provided "as is" without any representation or warranty of any kind. A Fitch rating is an opinion as to the creditworthiness of a security. The rating does not address the risk of loss due to risks other than credit risk, unless such risk is specifically mentioned. Fitch is not engaged in the offer or sale of any security. A report providing a Fitch rating is neither a prospectus nor a substitute for the information assembled, verified and presented to investors by the issuer and its agents in connection with the sale of the securities. Ratings may be changed, suspended, or withdrawn at anytime for any reason in the sole discretion of Fitch. Fitch does not provide investment advice of any sort. Ratings are not a recommendation to buy, sell, or hold any security. Ratings do not comment on the adequacy of market price, the suitability of any security for a particular investor, or the tax‐exempt nature or taxability of payments made in respect to any security. Fitch receives fees from issuers, insurers, guarantors, other obligors, and underwriters for rating securities. Such fees generally vary from US$1,000 to US$750,000 (or the applicable currency equivalent) per issue. In certain cases, Fitch will rate all or a number of issues issued by a particular issuer, or insured or guaranteed by a particular insurer or guarantor, for a single annual fee. Such fees are expected to vary from US$10,000 to US$1,500,000 (or the applicable currency equivalent). The assignment, publication, or dissemination of a rating by Fitch shall not constitute a consent by Fitch to use its name as an expert in connection with any registration statement filed under the United States securities laws, the Financial Services and Markets Act of 2000 of Great Britain, or the securities laws of any particular jurisdiction. Due to the relative efficiency of electronic publishing and distribution, Fitch research may be available to electronic subscribers up to three days earlier than to print subscribers. SEB Immoinvest REP February 2009  12