H1 2016 Investor Presentation by AFI Development

H1 2016 IR Presentation FINANCIAL & BUSINESS RESULTS August 2016

Disclaimer This document does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of AFI Development Plc (the "Company") or any of its subsidiaries in any jurisdiction or an inducement to enter into investment activity. No part of this document, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of the Company or any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with the document. This communication is only being distributed to and is only directed at (1) qualified institutional buyers (within the meaning of Rule 144A of the United States Securities Act of 1933, as amended (the "Securities Act") or (2) accredited investors (as defined in Rule 501(a) of Regulation D adopted pursuant to the Securities Act). Any person who is not a "qualified institutional buyer" or "accredited investor" should not act or rely on this document or any of its contents. This document contains "forward-looking statements", which include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of recent acquisitions, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of our shares or GDRs, financial risk management and the impact of general business and global economic conditions. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These forward-looking statements speak only as at the date as of which they are made, and the Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. Neither the Company, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this document. The information contained in this document is provided as at the date of this document and is subject to change without notice.

Company Overview SECTION 1

AFI Development at a glance Market Cap, as of 24 August 2016 Mkt price GDR, as of 24 August 2016 Mkt price B share, as of 24 August 2016 NAV (Equity), as of 30 June 2016 NAV per share, as of 30 June 2016 Portfolio Value*

US$152 mln US$0.140 US$0.150 US$767 mln US$0.73 US$ 1.4 bn

BUSINESS

PORTFOLIO VALUE*

HISTORY *Gross Asset Value of Portfolio based on JLL Valuation as for 30 June 2016 and BSV of Land Bank projects, Trading Properties and Hotels (incl. JV)

BRAND

•Full cycle real estate developer •Focus on unique large scale commercial and residential projects •Primary market: Moscow, Russia

•14 years on the market •Admitted to LSE in 2007 •Premium listing from 2010 •Free float – 35.12%

•Strong global and local brand •Subsidiary of Africa Israel Group (64.88% owner) , an international conglomerate with global focus on real estate, construction and infrastructure

FINANCIAL STABILITY

• Liquidity position: US$29.5 million as at 30 June, 2016 • Secured financing for on-going projects • 44% Debt to Total Assets ratio**

TRACK RECORD

•14 completed projects with total c. 0.6 mln sqm of space •Market reputation for high quality and professional property management

PORTFOLIO

• Substantial income generating portfolio. Major project AFIMALL City • 8 Development Projects & land bank

** Bank loans only

Key Projects in Moscow Yielding Projects (retail, offices and hotels) US$936 mn

Value** (JLL, 30 June 2016): Plaza II, Plaza Ib

Riverside Station Riverside St-n

AFIMALL

PLAZA SPA Kisl*

PLAZA SPA Zhel*

Aquamarine III

GLA (excl. hotels), sqm:

193.1K sqm

* Outside of Moscow * * Hotels presented at cost value Aquamarine Htl

Paveletskaya I

H2O

Projects Under Development Value**

US$435 mn

( JLL, 30 June 2016): Odinburg**

Paveletskaya II

Plaza IIa

KOSSINSKAYA Kossinskaya

Plaza Ic

B. Pochtovaya

Botanic Garden

Plaza IV

GLA, sqm:

231.4K

GSA, sqm:

730.7K

** Odinburg and Botanic Garden presented at cost value

Land Bank Yielding Projects Value (BSV):

Projects under Development Completed Assets

US$7 mn

Note: the NOI projections are â&#x20AC;&#x153;forward looking statementsâ&#x20AC;? based on JLL valuation assumptions and Company estimations and they can be realized or not realized due to factors beyond the Company's control including, among others, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of our shares or GDRs, financial risk management and the impact of general business and global economic conditions

Project Update. Yielding Projects SECTION 2

AFIMALL City Update

Ownership:50%

(as of June 2016) Total GBA, sqm

275.0K

Total GLA(shops, offices, storage), sqm

107.2K

Occupancy

78.7%

(as part of GLA total)

Parking lots Terminal NOI (JLL est.)

 The occupancy level was at 78% at the end of June 2016, a 4% decrease compared to the end of March 2016, due to lease termination for the 6th floor space  During the quarter, AFIMALL City welcomed several new tenants, including Technopark (consumer electronics), while TSUM and Massimo Dutti have extended their space in the Mall

2,022 US$ 83.85 m

MV (JLL est.)

US$ 657 m

Loan balance as for end of Q2, 2016

US$ 427 m

ITEM, US$ million (1) Revenue (2) Operating expenses (3) NOI

Actual Actual Actual Actual Q1 2016 Q2 2016 H1 2016 H1 2015 16.2 15.2 31.3 38.5 (2.6) (4.2) (6.8) (9.4) 13.6 11.0 24.6 29.1

Note: the NOI projections are “forward looking statements” based on JLL valuation assumptions and Company estimations and they can be realized or not realized due to factors beyond the Company's control including, among others, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of our shares or GDRs, financial risk management and the impact of general business and global economic conditions

Yielding Properties

Building

AFIMALL

Ozerkovskaya III*

Berezhkovskaya Tverskaya Plaza II

Tvesrkaya Plaza Ib

Paveletskaya I

Aquamarine Hotel

Moscow

Moscow City

CBD

Moscow

CBD

Retail

Office A & Street Retail

Office B

Office & Street Retail

Office B

GBA, sqm

283 182

61 579

11 612

5 848

2 338

16 246

GLA, sqm

107 208

46 247

10 274

5 024

2 050

2 022

466

140

78%

67%

83.9

28.5

657

197

Location Class

Parking lots (total), # Ocupancy rate (30.06.2016), % NOI term., (JLL est.), US$ mn MV**, US$ mn

Moscow

H2O Moscow

Plaza SPA Kislovodsk

Moscow

Plaza SPA Zheleznovodsk

TOTAL

Caucasus region

Hotel

10 080

8 931

25 000

11 701

437K

13 412

8 990

159 keys

275 keys

134 keys

193K

126

98%

79%

57%

83%

88%

79%

2.8

1.5

0.6

2.5

1.8

121

16.4

9.3

3.4

11.7

9.4

14.6

10.4

943

CBD

15 ***

46 ***

13.1 ****

14***

* GBA and GLA presented after disposal of Bld. 1. ** MV based on JLL valuation as for 30.06.2016. Hotels presented at cost value *** The hotel occupancy is presented as the annual average **** MV of the Plaza Spa Kislovodsk is presented as 50% (the Company share in the project)

Project Update. Development Projects SECTION 3

Odinburg Residential GBA, 821.1K sqm GSA residential, sqm 462.0K STATUS: Construction Bld.#2 SALE STATUS: Bld#1, Bld#2 are on sale Ownership:50%

Other 10

Odinburg Residential OVERVIEW  The ODINBURG residential district is located in the town of Odintsovo, a modern area considered to be one of the best and most environmentally clean towns in the Moscow region. (11 km from MKAD). A new highway to Moscow is in close proximity to the complex.  The entire residential district takes up an area of 33 hectares, which will host eight 8-to-25 story buildings. The residential element will offer 9,285 apartments and a total sellable area of 462K sq.m. (Including city share).

Ownership:50%

CONSTRUCTION STATUS and SALES  As of today, 695 out of 723 contracts for sales of apartments in Building 1 (38.3K sqm) have been signed, while for Building 2 235 out of 706 contracts (13.5K sqm) have been signed. (as of June 2016) Type

Residential

GBA, sqm

821.1K

GSA, sqm/GSA commercial total: GSA resi (Phase I), sqm: GSA resi (Phase II), sqm: GLA commercial, sqm: Apartments, total : Phase 1: Phase2: • Stage 1 • Stage 2 Parking units:

462.0/19.6K 154.8K 307.2K 16.8K

9,285 2,712 6,573 723 (Sold 695) 706 (Sold 235) 4,563

 Parking units: Building 1: 46 units out of 71 sold to date. Building 2: 7 units out of 71 sold to date.  Construction of Bld.#2 is ongoing. Bldg#1 completed, delivery of apartments started in March  Construction is funded with proceeds from sales. APARTMENTS DELIVERY Sales completed for 6m 2016 Apartments, quantity Apartments, sq.m. Parking places, units Comercial premises, sq.m.

682 37 521,60 38,00 359,30

Revenue Cost of sales Net profit Margin

RUB'000 3 490 836 3 200 946 289 891 8,30%

USD'000 49 686 45 560 4 126 8,30%

AFI Residence Paveletskaya As of June 2016 GBA (total), sqm:

133.5K

GBA (phase 1), sqm

50.4K

GSA (total), sqm:

78.9K

“Flats” (total), amnt

549

“Flats” (phase 1), amnt

175

“Apartments” (total), amnt

220

“Apartments “ (phase 1), amnt

220

Commercial space, sqm

17.1K

Commercial space (phase 1), sqm

5.8K

Book value, US$ m:

According to common market practice in Russia and to applicable Russian laws, preliminary sales of apartments during construction are done in the form of “contracts of participation in construction”, which are executed between the developer and purchaser of an apartment. These contracts are registered with state authorities and enter into legal force after this state registration. However the Company considers that signed contracts have high probability of registration and entering into legal force and reports “units sold” as the number of contracts signed with the apartments purchasers. “Apartments” are premises legally not zoned for housing, but are widely sold for residence (a person cannot register in this address, but the premises cannot be used for housing). The prices of ‘apartments’ are normally lower than this of similar flats

 Construction of Phase 1 started in December 2015.  As of 24 August 2016, contracts for 75 flats and 15 “apartments” have been signed.

 Parking lots sold: 74 units.

(properly zoned housing units).

Development Projects - Residential POCHTOVAYA

BOTANIC GARDEN

Botanic Garden

(as of March 2016)

(as March 2016) Type

Resi

Type

Resi

GBA, sqm

170.3K

GBA, sqm

255.0K

GSA/GLA, sqm

56.9/34.2K

GSA/GLA, sqm

107.5/5,1K

Parking

1,334 pp

Parking

1,771 pp

Status

Launch of construction in Q4 2016

MV, US$

74 mil

MV, US$

22 mil

Pochtovaya

Paveletskaya

Other

Development Projects - Commercial PLAZA IC

KOSSINSKAYA

(as of March 2016) Type GBA, sqm GLA, sqm Parking

Office A 61.8K 37.0K 521 pp

Status

Ready for construction launch 65 mil

MV, US$

(as of March 2016) Type GBA, sqm GLA, sqm Parking MV, US$

Plaza IV Plaza IC

Mixed use 108.0K 70.0K 1,200 pp 27 mil

Kossinskaya

PLAZA IV*

(as of March 2016)

Other

Type GBA, sqm GLA/GSA, sqm

Office A 108.0K 58.7/2.7K

Parking Status

1,210 pp

MV, US$

Preparing for construction 63 mil

*For 100% of the project

Financial update SECTION 4

Consolidated P&L ITEM, US$ million (1) (2) (3)

Construction consulting/management services Rental income Sale of residential and trading property

(4) TOTAL REVENUE (5) (6) (7) (8) (9)

Other income Operating expenses Administrative expenses Cost of sales of residential and trading property Other expenses

(10) TOTAL EXPENSES (11)

Share of profit of equity-accounted investees

Actual Actual Actual Q1 2016 Q2 2016 H1 2016 0.0 20.0 7.3

0.1 19.8 42.4

0.1 39.9 49.7

27.4

62.3

89.7

2.2 (7.7) (1.7) (6.2) (0.0)

0.3 (10.0) (1.7) (39.4) (0.6)

2.5 (17.7) (3.4) (45.6) (0.6)

(13.4)

(51.5)

(64.8)

1.1

1.2

2.3

(12) GROSS PROFIT (LOSS)

15.1

12.1

27.2

(13) (14)

(60.3) -

(40.6) -

(100.9) -

(15) RESULTS FROM OPERATING ACTIVITIES

(45.2)

(28.5)

(73.7)

(16) (17) (18) (19)

(0.0) 0.7 (10.7) 20.5

1.7 0.5 (11.1) 16.3

1.7 1.2 (21.7) 36.7

10.5 (34.7)

5.7 (21.0)

16.2 (55.7)

(0.1) 2.9

(0.1) (0.4)

(0.1) 2.5

(31.9)

(21.4)

(53.3)

Valuation gain (loss) on investment property Impairment loss for trading property and hotels Profit on sale/disposal of properties/investment Finance income Finance expenses FX Gain/(Loss)

(20) Net finance income/(costs) (21) PROFIT BEFORE INCOME TAX (22) (23)

Current income tax Deferred income tax

(24) PROFIT (LOSS) FOR THE PERIOD

* Other income mainly due to property tax repayment

Other 16

Balance Sheet as of 30 June 2016 #

(1) (2) (3) (4) (5) (6) (7)

Investment property Investment property under development Property, plant and equipment Long-term loans receivable Inventory of real estate Total non-current assets Trading property

(8)

Trading properties under construction

(9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) (20) (21) (22) (23) (24) (25) (26) (27) (28) (29) (30) (31) (32)

Inventory Short-term loans receivable Trade and other receivables Current tax assets Cash, cash equivalents and tradable securities Total current assets TOTAL ASSETS Equity Share capital Share premium Translation reserve Capital reserve Retained earnings TOTAL EQUITY Minority interest Long-term loans and borrowings Deferred tax liabilities Deferred income Total non-current liabilities Short-term loans and borrowings Trade and other payables Advances from customers Income tax payable Total current liabilities

(33) TOTAL LIABILITIES (34) TOTAL EQUITY AND LIABILITIES

30.06.2016 31.03.2016 30.06.2015 Change YoY US$ mn US$ mn US$ mn US$ mn % 904.4 912.6 1 1 351.9 (447.5) (33%) 231.9 237.0 425.2 (193.4) (45%) 29.7 28.3 35.1 (5.4) (15%) 15.5 13.9 15.8 (0.3) (2%) 21.5 20.4 21.6 (0.1) (0%) 1 203.0 1 212.3 1 849.7 (646.7) (35%) 8.9 2 35.2 2.6 6.3 247% 181.7

178.7

143.9

37.9

26%

0.6 0.0 33.1 1.6 29.5 255.4 1 458.4

0.5 0.1 29.5 1.7 32.5 278.3 1 490.6

0.4 0.1 43.7 1.4 78.6 270.6 2 120.3

0.2 (0.1) (10.6) 0.2 (49.1) (15.2) (661.8)

49% (81%) (24%) 17% (62%) (6%) (31%)

1.0 1763.4 (315.1) (9.2) (673.4) 766.7 (4.0) (0.0) 17.5 9.4 26.9 620.4 23.3 25.0 0.0 668.7

1.0 1763.4 (324.7) (9.2) (652.3) 778.3 (3.9) (0.0) 18.8 9.1 27.9 612.9 3 18.2 57.1 0.0 688.2

1.0 1763.4 (311.1) 0.0 (190.8) 1 262.5 (8.8) 629.7 100.9 11.3 741.9 46.1 23.2 55.4 0.0 124.7

(0.0) (0%) 0.0 0% (4.0) 1% (9.2) (482.6) 253% (495.8) (39%) 4.9 -55% (629.7) (100%) (83.4) (83%) (1.9) (17%) (715.0) (96%) 574.3 1245% 0.2 1% (30.4) (55%) 0.0 544.0 436%

691.7

712.3

857.8

(24.8)

(19%)

1 458.4

1 490.6

2 120.3

(53.5)

(31%)

Change in AFIMall value in Q1 due to the decrease in rental rates 1.

Delivery of Building 1 in Odinburg

In Q1 2016 AFIMall loan was reclassified from the non-current to current liabilities.

Loans and cash position as of 30 June 2016  Gross balance of the bank loan portfolio (as of 30 June 2016) – US$ 618.2 million  Total cash balance and deposits (as of 30 June 2016) – US$33.1 million (including marketable securities)

Project

Bank

Historical debt limit

VTB AFIMALL TOTAL AFIMALL

TOTAL/AVERAGE RATE

Available (US$ mn)

Nominal Interest rate

Currency

$150

9.5%

RUB

$277

3m Libor + 5.02%

USD

$427

6.74%

3m Libor + 8% from 24.01.15 to 20.03.15 3m Libor + 7% from 21.03.15 to 26.01.18

RUR 21 bn VTB

Ozerkovskaya III

Balance as of 30 June, 2016 (US$ mn)

VTB

$220

Maturity

01.04.2018

$191

$619

USD

26.01.2018

6.90%

Financial covenants As announced on 15 July 2016, Mr Leviev and VTB continue to negotiate the terms of a personal guarantee that may be provided by Mr Leviev to VTB in respect of the Group’s obligations under the Ozerkovskaya III Loan Facility (the “Personal Guarantee”) as an alternative to the Disposal Transaction. If these discussions result in the Personal Guarantee and related documentation being agreed prior to completion of the Disposal Transaction then, subject to obtaining all approvals required (including if necessary any shareholder approvals) in relation to the Personal Guarantee, the Board of the Company may determine not to proceed with the Disposal Transaction. On 1 July 2016 the Company announced on its decision not to make the quarterly principal payments of US$1.815 million and US$6.5 million due on 30th June 2016, (“the Principal Payments”) under the loan facilities provided to each of Krown Investments LLC (“Krown”) and Bellgate Constructions Limited (“Bellgate”) (together “the Loan Facilities”). The decision followed the respective application made by the Company to VTB Bank PJSC (“VTB”) against the background of negotiations between the Company Chairman, Mr Leviev, and VTB on the Personal Guarantee. On 27 July 2016 Krown, Bellgate, AFI Development and Semprex LLC executed addenda to the loan facility agreements and respective security agreements with VTB, according to which the due date for the Principal Payments have been deferred to 30th September 2016. 18

Gross/Net Asset Value PROJECT

Book Value

Book Value Bank Loan

Net Company Share

31.03.2016

30.06.2016

666 16 12 9 197 3 9 1 913

657 16 12 9 197 3 9 0 904

(427)

230 16 12 9 6 3 9 0 286

66 0 69

65 0 63

28 71 4

27 74 4

TOTAL INVESTMENT PROPERTY UNDER DEVELOPMENT:

237

232

Ozerkovskaya Phase II (26) Odinburg Aquamarine Hotel Plaza SPA Zheleznovodsk Pyatigorskaya (Park Plaza Kislovodsk) Plaza Spa Kislovodsk (JV) (50%) TOTAL PROPERTY PLANT AND EQUIPMENT: Odinburg Botanic Garden Paveletskaya II

2 33 35 14 10 4 12 40 119 20 59

2 7 9 15 10 4 13 42 118 22 63

TOTAL TRADING PROPERTY UNDER DEVELOPMENT:

199

203

1 424

1 390

(619)

772

AFI Mall Berezhkovskaya (100%) Paveletskaya I Plaza H20 Ozerkovskaya III Plaza Ib Plaza II Sadovaya -Samotechnaya TOTAL INVESTMENT PROPERTY: Plaza Ic Plaza II a Plaza IV (100%) Kossinskaya Bolyshaya Pochtovaya Ruza

TOTAL TRADING PROPERTY:

TOTAL PORTFOLIO:

(191)

(619)

Loans To Assets Value = 44% (LTV ratio) Loans To Equity (LTE ratio)

= 81%

232 2 7 9 15 10 4 13 42 118 22 63

CASH AND CASH EQUIVALENTS DEFFERED TAX LIABILITY TOTAL OTHER ASSETS AND LIABILITIES

30 (18) (17)

TOTAL EQUITY:

767

Market Update SECTION 5

Macro Overview and RE Investment Market RUSSIAN MACROECONIMIC OVERVIEW • Russian economic growth: Oxford Economics have improved their previous Russian GDP forecast from -2.1% to -1% in 2016. • Exchange rates: The oil prices experienced a rising trend between February and June, which supported the rouble. The spot RUR/USD rate in H1 2016 fluctuated between 63 and 83 with a tighter range of 64-71 in Q2. The rate at 30.06.2016 was RUR64.26 (vs. RUR 72.88 on 31.12.2015). • The Central Bank of Russia (“CBR”) has reduced, in its June meeting, the key lending rate to 10.5%, to cautiously reflect the stabilisation in the macroeconomy. • Inflation: The consumer prices inflation in June 2016 was at 7.5% (annualised) (with CBR target at 4%).

RUSSIAN REAL ESTATE INVESTMENT MARKET • In H1 2016, about US$2.3 billion (CBRE) were invested by domestic and foreign investors in Russian commercial real estate. The investments in Q2 2016 were, however, very weak at US$390m. The investors have been predominantly Russian. Forum Properties sold “Aurora Business Park” to O1 Properties for shares in O1 Properties. • According to C&W, 67% of the volume was invested in the office segment, which remains the most attractive, and 26% in hotels. 6% were invested in warehouses. Only 0.2% were invested in retail. Forecasted Investment Volume in 2016 (USD billion)

JLL

CBRE

C&W

4.5

3.5

* JLL estimation excludes acquisitions by end-users and joint ventures

Interest rates

Source: CBR, Oxford Economics 21

Source: CBR, Oxford Economics, C&W, JLL, CBRE

Office and Retail Markets Overview OFFICE MARKET OVERVIEW

RETAIL MARKET OVERVIEW

• The take up in H1 2016 demonstrated 17% growth compared to H1 2015. 167.6 thousand sqm of quality office premises were taken up during the quarter, versus 143.3 thousand sqm in Q1 2015. The delivery of quality space amounted to 63.1 thousand sqm for the quarter, all of them in Class B (a drop of 30% vs Q1 2015).

• One new shopping centre, Riviera, was opened in Moscow in Q2 2016, while the CBRE estimation for new delivery in 2016 is 400,000 sqm of GLA.

• The vacancy rates in class A and B are high: In Class A the vacancy in was recorded at 23.1% (vs 24.3% in Q1 2015) and in Class B at 15.4% (vs 12.2% in Q1 2015). Vacancy in the Moscow-City submarket is estimated at 16.4% (JLL). • In Q1 2016 the rents remained relatively stable. Asking rents for Class A non-prime central premises were at US$600750 psqmpa. Asking rents for off-centre Class A office buildings were US$400-600 and for Class B $200-400. Rouble denominated rents prevail in Class B space and in non-prime Class A. Key indicators Base Rent, US$ psqmpa

Units

• Fast-food, alcomarkets and entertainment were the leading developing retail segments in H1 2016. • The vacancy rate across Moscow shopping centres as of the end of H1 2016 was at 12.0% (C&W). • The fixed exchange rates are commonly provided to tenants, while most new leases are roubledenominated. Turnover rent with a low minimum rent is the most common lease structure.

C&W Prime rental rate indicator, US$ psqmpa

Key indicators

Units

Prime rent, US$ psqma

1,5003,220

Base rent Class A (Prime), US$ psqmpa

600-800

Base rent Class A, US$ psqmpa

400-600

(prime shopping centre gallery)

Base rent Class B, US$ psqmpa

200-400

Base rent, US$ psqma

Overall vacancy,%

17%

Vacancy rate, Class A, %

23%

Source: CBRE Marketview Moscow Office Q1 2016, C&W MarketBeat Q1 2016, JLL Moscow Office Market Q1 2016

1,230

Vacancy rate,%

12.0%

Source: JLL Moscow Shopping Centre Market Q1 2016, CBRE Moscow Retail MarketView Q1 2016 22

Residential Market Overview RESIDENTIAL MARKET MOSCOW AND MOSCOW REGION

MOSCOW:

• According to the Moscow Statistics Agency, the volume of commissioned residential construction in Moscow for the period January to May 2016 amounted to 1.0 million sqm, which is about 32% lower than in for the same period in 2015 (the official statistics does not include “apartments”, which legally are not considered residential). • At the end of H1 2016 the supply at the Moscow primary residential market (excluding “apartments”) was about 2.1 million sqm (about 30,800 residential units), a decrease of 7% compared to the end of Q1 2016.

• By the end of June 2016 the weighted average asking price in the newly built business class residential market in Moscow amounted to RUR258,660 psqm (US$3,979, USD/RUB = 65). Compared with the end of March 2016, prices increased in average by 3.3% in roubles. In the comfort class the weighted average asking price was RUR160,990 psqm (US$2,476, USD/RUB = 65)

Average weighted asking price in primary residential market of “old” Moscow, by districts, end of Q2 2016 (USD/RUR ‘000 psqm)

NORTHERN USD

3,640 234.2

RUR ‘000

NORTH-EASTERN USD RUR ‘000

EASTERN

NORTH-WESTERN

USD

3,280

USD RUR ‘000

RUR ‘000

210.7

WESTERN USD RUR ‘000

CENTRAL USD

5,580

RUR ‘000

358.8

3,560 228.7

• At the end of Q2 2016, the primary market supply (newly built residential units) in the Moscow region amounted to about 10,222 residential units (an increase of 1.6% vs Q1 2016).

3,140 201.9

SOUTH-EASTERN

MOSCOW REGION (< 30 km from MKAD):

• The Moscow Region has been the leading region in Russia by volume of delivered housing (2.1 million sqm. Jan-May 2016).

2,560 164.7

USD

2,180

RUR ‘000

140.0

SOUTH-WESTERN USD RUR ‘000

2,740 176.3

SOUTHERN USD RUR ‘000

2,580 166.2

• As of June 2016 the weighted average price per sqm in Moscow region was RUR79,143 (US$1,217, USD/RUB = 65) Source: Blackwood H1 2016 Moscow Residential Market Overview Source: Blackwood H1 2016 Moscow Residential Market Overview, Peresvet Q2 2016 Moscow Region Primary Residential Market Overview

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