H1 2017 Investor Presentation by AFI Development

H1 2017 IR Presentation FINANCIAL & BUSINESS RESULTS August 2017

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 17 August 2017 Mkt price GDR, as of 17 August 2017 Mkt price B share, as of 17 August 2017 NAV (Equity), as of 30 June 2017 NAV per share, as of 30 June 2017 Portfolio Value*

US$204 mln US$0.170 US$0.219 US$776 mln US$0.74 US$ 1.49 bn

BUSINESS

PORTFOLIO VALUE*

HISTORY

*Gross Asset Value of Portfolio based on JLL Valuation as of 30 June 2017 and BSV of Land Bank projects, Trading Properties and Hotels

BRAND

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

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

•Strong local and international brand

FINANCIAL STABILITY

• Liquidity position: US$25.5 million as at 30 June 2017 • 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) Value** Plaza II, Plaza Ib

Riverside Station Berezhkovskaya

AFIMALL

GLA (excl. hotels), sqm: PLAZA SPA Kisl* PLAZA SPA Zhel*

US$997 mn

(JLL and book value, as of 30 June 2017):

193.1K sqm

Aquamarine III

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

Paveletskaya I

H2O

Projects Under Development Value** Odinburg**

Paveletskaya II

Plaza II

KOSSINSKAYA Kossinskaya

US$463 mn

(JLL and book value, as of 30 June 2017):

Plaza Ic

B. Pochtovaya

Botanic Garden

Plaza IV

GLA, sqm:

231.6K

GSA, sqm:

730.9K

** Odinburg and Botanic Garden presented at cost value

Land Bank Yielding Projects Value (BSV):

US$4 mn

Projects under Development Completed Assets 5

Project Update. Yielding Projects SECTION 2

AFIMALL City Update

(as of June 2017) Total GBA, sqm

275.0K

 The occupancy level was 87% at the end of June 2017, vs. 83% at the end of March 2017

Total GLA (shops, offices, storage), sqm

107.2K

 AFIMALL City’s performance continues to improve, reflected in increased revenue (US$39.8 million for H1) and NOI (US$29.4 million for H1)

Occupancy

87%

Parking lots

2,022

 Recent new openings at AFIMALL City include a 1,300 sqm “Golden Apple” luxury fragrance and beauty store, a Levon’s Highlands Cuisine café and Finish childrenswear retailer, Reima

Terminal NOI (JLL est.)

US$ 84.38 m

MV (JLL est.)

US$ 670.9 m

Loan balance as of the end of Q2, 2017

US$ 440.2 m

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

Q1 2017 Q2 2017 6M 2017 6M 2016 Actual Actual Actual Actual 19.5 20.3 39.8 31.3 (5.2) (5.2) (10.4) (6.7) 14.3 15.1 29.4 24.6

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

Moscow

Moscow City

CBD

Moscow

Retail

Office A

GBA, sqm

275 046

61 579

7909,8*

GLA, sqm

107 208

46 247

2 022

Location Class

Parking lots (total), # Ocupancy rate (30.06.2017), % NOI term., (JLL est.), US$ mn MV**, US$ mn

Tvesrkaya Plaza Ib Moscow

CBD Office & Street Office B Retail

Paveletskaya I Moscow

H2O Moscow

Aquamarine Hotel Moscow CBD

Plaza SPA Plaza SPA Kislovodsk Zheleznovodsk

TOTAL

Caucasus region Caucasus region

Office B

Hotel

2 338

16 246

10 080

8 848

25 000

11 701

437K

6928*

2 050

13 412

8 990

159 keys

275 keys

134 keys

193K

466

105

87%

94%

87%

63%

77%

85.4

29.4

1.9

0.6

2.6

1.8

670.9

198.5

11.7

3.5

12.0

9.4

82% ***

78%***

122

16.3

45.6

12.0

980

***

* Change in areas due to completed exchange transaction with former JV partner ** MV based on JLL valuation as for 31.12.2016 (there were no changes as of 31.3.2017). Hotels presented at cost value *** The hotel occupancy is presented as average for the period

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. Development Projects SECTION 3

Odinburg Residential GBA, 831.1K sqm GSA residential, sqm 462.0K STATUS: Delivery Bld.#2, construction Bldg .#6 SALES STATUS: Bld#1, 2, 6 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, 717 out of 723 contracts for sales of apartments in Building 1 (39.24 K sqm) have been signed, while for Building 2 594 out of 706 contracts (35.74 K sqm) have been signed. (as of June 2017) Type GBA, sqm

 Parking lots sold: Building 1: 55 units out of 71. Building 2: 55 units out of 81. Residential 831.1K

GSA, sqm/GSA commercial total: 462.0/19.6K GSA resi (Phase I), sqm: 154.8K GSA resi (Phase II), sqm: 307.2K GLA commercial, sqm: 19.6K Apartments, total : 9,285 Phase 1: 2,712 • Building 1 723 • Building 2 706 Phase2: 6,573 • Building 6 224 Parking units: 4,563 Book value, US$ m (including value 124 of unsold apartments): Outstanding loan, US$ m 3.2

 Construction and pre-sales have started in Building 6. As of today, 7 out of 224 contracts for sales of apartments in Building 6 (326 sqm) have been signed.  A credit line of RUR620 million (US$10.3 million) was obtained from Sberbank in March 2017. Outstanding debt as of 30.06.2017 was US$3.2 mil APARTMENTS DELIVERY Sales completed for 6m2017 Apartments, quantity Apartments, sq.m. Parking places, quantity Comercial premises, quantity Comercial premises, sq.m. Apartments transferred to the City as per IC, quantity Apartments transferred to the City as per IC, sq.m.

Revenue Cost of sales Net profit Margin

540 32 309.40 38 5 674.70 11 970.20 RUB'000 USD'000 2 871 789 49 525 2 733 042 47 130 138 747 2 395 4.83% 4.84%

AFI Residence Paveletskaya As of June 2017 GBA (total), sqm:

136.1K

GBA (phase 1), sqm

52.9K

GSA (total), sqm:

79.4K

Apartments (total), amnt

549

Apartments (phase 1), amnt

175

“Special units” (total), sqm

11.4K

“Special units“ (phase 1), amnt

187

Commercial space, sqm

17.3K

Commercial space (phase 1), sqm

6.1K

Book value, US$ m:

91.1

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. “Special units” are premises legally not zoned for housing, but are widely sold for residence (a person cannot register in this address, but the premises can be used for housing). The prices of ‘special units’ are normally lower than that of similar apartments (properly zoned housing units).

 The construction continues as planned  As of today, contracts for 270 apartments and “special units” have been signed

 Parking lots sold: 229 units.

AFI Residence Pochtovaya As of June 2017 GBA (total), sqm:

136.6K

GBA (phase 1), sqm

40.8K

GSA (total), sqm

84.9K

Apartments (total), amnt

626

Apartments (phase 1), amnt

187

“Special units” (total), sqm

16K

“Special units“ (total), amnt

281

Commercial space, sqm

16K

Commercial space (phase 1), sqm

8.6K

Book value, US$ m:

74.9

 The development is located in Bolshaya Pochtovaya Street, in the Central Administrative District of Moscow  The project is planned in four phases. The construction of Phase I has started in March 2017  As of today, contracts for 13 apartments have been signed.

AFI Residence Botanic Garden As of June 2017 GBA (total), sqm:

200.6K

GBA (phase 1), sqm

120.6K

GSA (total), sqm:

115.9K

GSA (phase 1), sqm

61.7K

Apartments (total), amnt

1340

Apartments (phase 1), amnt

761

Commercial space, sqm

8.6K

Commercial space (phase 1), sqm

2.4K

Book value, US$ m:

 The development is located in Proezd Serebryakova, in the Northern Administrative District of Moscow  The project is planned in three phases. The construction of Phase I has started in March 2017.  As of today, 40 out of 761 contracts for sales of apartments have been signed.

Development Projects - Commercial PLAZA IC

KOSSINSKAYA

(as of June 2017) Type GBA, sqm GLA, sqm Parking

Office A 50.2K 37.0K 521 pp

Status

Ready for construction launch 66.1 mil

MV, US$

(as of June 2017) Type GBA, sqm GLA, sqm Parking MV, US$

Plaza II Plaza IV Plaza IC

Mixed use 108.5K 70.0K 1,200 pp 28.4 mil

Kossinskaya

PLAZA IV

PLAZA II

(as of June 2017)

(as of June 2017) Type

Retail

GBA, sqm GLA, sqm Parking MV, US$

21K 12.4K 44 pp 20.0 mil

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 65.4 mil

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

Q1 2017 Q2 2017 Actual Actual

6M 2017 Actual

6M 2016 Actual

0.1 25.5 21.9

0.0 30.6 27.9

0.1 56.1 49.8

0.1 39.9 49.7

(4) TOTAL REVENUE

47.5

58.6

106.1

89.7

(5) (6) (7) (8) (9)

0.2 (12.3) (0.5) (20.3) (0.4)

0.4 (14.2) (2.6) (27.0) (1.7)

0.5 (26.4) (3.1) (47.3) (2.1)

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

(33.4)

(45.0)

(78.4)

(64.8)

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

2.0

(12) GROSS PROFIT

16.1

13.6

(13)

(43.6)

42.7

(14) RESULTS FROM OPERATING ACTIVITIES

(27.5)

56.3

(15) Profit on disposal of investment property (16) Gain on 100% acquisition of previously held interest in JV (17) Finance income (18) Finance expense (19) FX Gain/( Loss)

7.5 0.4 (16.5) 28.7

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

Valuation gain (loss) on investment property

Current income tax Deferred income tax

(24) PROFIT (LOSS) FOR THE PERIOD

2.0

2.3

29.7

27.2

(0.9)

(100.9)

28.7

(73.7)

(0.0) 0.1 (12.9) (18.9)

7.5 0.5 (29.4) 9.8

1.7 1.2 (21.7) 36.7

12.6 (7.4)

(31.7) 24.6

(19.1) 17.2

16.2 (55.7)

(0.5) 8.9

(1.8) (15.9)

(2.2) (7.0)

(0.1) 2.5

1.0

6.9

7.9

(53.3)

Balance Sheet as of 30 June 2017 #

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) (20) (21) (22) (23) (24) (25) (26) (27) (28) (29) (30) (31) (32)

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

Change YoY 30.06.2017 31.03.2016 30.06.2016 US$ mn US$ mn US$ mn US$ mn % 926.1 915.3 904.4 21.7 2% 159.9 158.8 231.9 (72.0) (31%) 76.4 79.1 29.7 46.7 157% 0.0 0.0 15.5 (15.5) (100%) 0.0 0.0 21.5 (21.5) (100%) 1 162.5 1 153.3 1 203.0 (40.5) (3%) 21.4 50.0 8.9 12.5 141% 302.7 292.1 181.7 121.0 67% 1.0 1.1 0.6 0.4 73% 0.8 0.4 0.0 0.7 2991% 51.6 51.2 33.1 18.5 56% 1.4 2.5 1.6 (0.3) (17%) 25.5 29.6 29.5 (4.0) (14%) 404.3 427.0 255.4 148.9 58% 1 566.7 1 580.3 1 458.4 108.3 7% 1.0 1763.4 (309.0) (19.3) (660.2) 775.9 (0.1) 23.71 29.4 11.3 64.4 634.01 45.9 46.7 0.0 726.6

1.0 1763.4 (296.1) (13.7) (666.7) 787.9 (0.9) 469.0 11.6 11.6 492.2 193.4 54.0 53.7 0.0 301.2

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

0.0 (0.0) 6.1 (10.1) 13.2 9.2 3.8 23.7 11.9 1.8 37.4 13.6 22.6 21.7 0.0 57.9

(0%) (2%) (2%) 1% (97%) n/a 68% 20% n/a 2% 97% 87% 9%

791.0

793.4

695.6

95.3

14%

1 566.7

1 580.3

1 458.4

59.0

Notes:

The AFIMALL City loan has been re-classified to short-term borrowings (maturity in less than 12m) (the Ozerkovskaya III loan was similarly re-classified in Q1 2017) 1.

Loans and cash position as of 30 June 2017  Gross balance of the bank loan portfolio (as of 30 June 2017) – US$ 657.2 million  Total cash balance and deposits (as of 30 June 2017) – US$25.5 million (including marketable securities)

Project

Bank

Historical debt limit

VTB AFIMALL TOTAL AFIMALL

Kislovodsk Odinburg TOTAL/AVERAGE RATE

Available (US$ mn)

Nominal Interest rate

Currency

163.3

9.5%

RUB

276.9

3m Libor + 5.02%

USD

440.2

7.3% 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, 2017, (US$ mn)

Maturity

01.04.2018

VTB

$220 mn

192

VTB Sberbank

$22.5 mn RUR 620 mn

22.1 3.2 657.2

0 2.5

3m Libor + 4.5% 11.5% 7.4%

USD

26.01.2018

USD RUB

22.02.2022 19.03.2020

Financial covenants Ozerkovskaya III: Following execution of addenda to loan agreements in September 2016, the covenants in the Ozerkovskaya III facility (the LTV covenant and the DSCR covenant) were removed. Kislovodsk: 1) EBITDA/((Interest rate (LTM) + Debt (last reporting date)) – 0.32x; 2) Projected DSCR – 1.81x; 3) Positive value of net assets

Gross/Net Asset Value PROJECT

Book Value

Book Value Bank Loan

Net Company Share

31.03.2017

30.06.2017

667 16 12 9 199 3 9 915 66 65 28 0

671 12 12 9 199 4 20 926 66 65 28 0

(440)

231 12 12 9 7 4 20 294 66 65 28 0

TOTAL INVESTMENT PROPERTY UNDER DEVELOPMENT:

159

160

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

2 48 50 16 12 4 46 78 112 25 82 74

2 20 21 16 12 4 44 76 105 32 91 75

TOTAL TRADING PROPERTY UNDER DEVELOPMENT:

292

303

(3)

299

1 494

1 486

(657)

828

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

TOTAL TRADING PROPERTY:

TOTAL PORTFOLIO:

(192)

(632)

(22) (22) (3)

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

= 85%

160 2 20 21 16 12 4 22 53 101 32 91 75

25 (29) (48)

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

TOTAL EQUITY:

776 1

Market Update SECTION 5

Macro Overview and RE Investment Market RUSSIAN MACROECONIMIC OVERVIEW • Russian economic growth: OECD has improved the 2017 GDP forecast to +1.4%, quoting improving consumption and investment. • Exchange rates: The rouble was relatively stable during Q2 2017, supported by steady oil prices. The spot RUR/USD rate during Q2 2017 fluctuated between 56 and 60. The rate at 30.06.2017 was RUR59.09 (vs. RUR56.38 on 31.03.2017). • The Central Bank of Russia (“CBR”), has reduced the key lending rate to 9.0 % on its June 2017 meeting (left unchanged in July), reflecting further stabilisation in the macroeconomy. • Inflation: The consumer prices inflation in June 2017 was at 4.4% (annualised) (with CBR target at 4%).

RUSSIAN REAL ESTATE INVESTMENT MARKET • During H1 2017, about US$2.2 billion (JLL) were invested in Russian commercial real estate (39% increase year-on-year). • According to JLL, in H1 2017 41% of the volume was invested in the retail segment, 32% in office and 21% in hotels and warehouses. 79% of the invested capital was of Russian origin. • The biggest transactions of Q2 were the disposal of the shopping centre “Gorbushkin Dvor” in Moscow to a Russian private investor (the transaction is estimated at EUR445 million) and the sale of Vozdvizhenka BC (“Voentorg”) to Fosun Group and Avica Management Co. (estimated at RUR10 billion) Forecasted Investment Volume in 2017 (USD billion)

JLL 4.5

CBRE

C&W

4.6

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

CBR policy rates and inflation

Source: CBR, RBC, OECD 22

Source: C&W, JLL, CBRE

Office and Retail Markets Overview OFFICE MARKET OVERVIEW

RETAIL MARKET OVERVIEW

• Although the take up in H1 2017 was 947 thousand sq.m, a 50% increase vs H1 2016, Cushman&Wakefield reports negative net absorption of –263K sqm for H1. The take up was led by the financial sector. No new office space was delivered in Q2, the delivery for H1 2017 amounted to mere 21 thousand sqm (minimal level in years). • The vacancy rates in class A and B remain high: According to CBRE, in Class A the vacancy was recorded at 18.4% (vs 19.0 % in Q1 2017) and in Class B at 14.3% (versus 14.7% in Q1 2017). • In H1 2017 the rents remained relatively stable. Asking rents for Class A non-prime central premises were at US$600-750 psqmpa. Asking rents for off-centre Class A office buildings were US$400-600 and for Class B $200-400. Rouble denominated rents continue to prevail in H1 2017, though the share of dollar leases in Q2 was higher than in Q1 (C&W reports 77% roubledenominated rents in H1 2017 vs 97% in Q1) Base Rent, US$ psqmpa

A class

Source: CBRE, JLL, C&W

B class (B+&B-)

Key indicators

Units

Base rent Class A (Prime), US$ psqmpa

600-750

Base rent Class A, US$ psqmpa

400-600

Base rent Class B, US$ psqmpa

200-400

• No shopping centres were opened in Moscow in H1 2017. • 23 new international brands entered the market in H1 2017, including Ahimsa, who opened their first to Russia shop in the AFIMALL. • The vacancy rate across Moscow shopping centres as of the end of H1 2017 was at 8.8% (CBRE). • Turnover rent with a low minimum rent continues to be the most common lease structure. Fixed exchange rates are commonly provided to tenants.

C&W Prime rental rate indicator, US$ psqmpa

Key indicators

Prime rent, RUR psqma (prime shopping

Units

195,000

centre gallery)

Overall vacancy,%

15.4%

Vacancy rate, Class A, %

18.4%

Average rent, RUR psqma

74,000

Vacancy rate,%

Source: JLL, CBRE, C&W

8.8%

Residential Market Overview RESIDENTIAL MARKET MOSCOW AND MOSCOW REGION

Average weighted asking price in primary residential market of “old” Moscow, by districts, end of Q2 2017 (RUR psqm)

MOSCOW:

• At the end of Q2 2017 the supply on the “Old Moscow” primary residential market (excluding “apartments”) was about 2.84 million sqm (about 44,700 residential units), a 6% increase vs Q1 2017. The supply in “New Moscow” was about 523.2 thousand sqm, a 9% decrease vs Q1 2017 (data by Miel Real Estate). • By the end of Q2 2017 the weighted average asking price in the newly built business class residential market in Moscow amounted to RUR244,700 psqm (US$4,147, USD/RUB = 59). Compared with the end of Q1 2017, the average prices decreased by 1% in roubles. In the comfort class the weighted average asking price was RUR151,4 psqm (US$2,566, USD/RUB = 59). MOSCOW REGION:

North North-East

East North-West

Central West

• At the end of Q2 2017, the primary market supply (newly built residential units) in the Moscow region amounted to 3.1 million sqm (a decrease of 2% vs end of Q1 2017, according to Miel Real Estate). • In Q2 2017 the weighted average price per sqm in the Moscow region was RUR85,000 (US$1,440, USD/RUB = 59), no change in roubles, compared to end of Q1 2017 (data by Miel Real Estate).

Source: Miel Real Estate

South-East

South South-West

Source: NDV Real Estate 2 4