Prime London Central Residential: Is the bubble about to burst? A Presentation by London Central Portfolio, Residential Funds and Asset Managers

The past…the present... The future? The elephant in the room Risk Warning Views and opinions expressed in this presentation are those of London Central Portfolio Limited and do not necessarily represent the views of any third party associates who in no way warrant the accuracy or completeness and accept no liability for any direct or consequential losses arising from its use. There can be no assurance that current market conditions will remain in the future. Past performance does not guarantee future results. Actual results may differ materially from the forecasts/estimates. Views, opinions, trends and prices expressed are subject to change without prior notice and are expressed solely as a general market commentary and do not constitute investment advice or a guarantee of returns. Looking at PLC residential as a commercial asset class

Not the UK… 23m residential units 63.2m people 61,840 sq. miles Average price £238,293

Not Greater London… 12.5% UK population 8m people 33 boroughs Performance closely correlated to the UK

Not... the East End, home of the Olympic Village 19,574 Planning permissions. Average price £231,296 11,430 Planning permissions. Average price £370,500 Not...Canary Wharf, home of Multinationals

Average price £1,359, ,045 people 5,000 transactions p.a. It is Prime London Central…the home of ,308 units 613 under construction

…It is the bullseye of the capital Made up of numerous villages around Hyde Park…

The long term… Globally desirable International centre Highly demanded asset backed investment Low dependence UK economy Irreplaceable architecture Go-to destination

London Residential – A Capital Growth Asset Prices have increased over 65 times since 1969 Source: CML, ODPM, OCLG Past performance is not a guide to the future Capital Growth Since 1969

The short term… A robust performer in volatile markets London Central vs FTSE 100 (Q = 100)

A strong story to tell in all market conditions… Performance of gold versus London Central (1995= 100)

To many foreigners, Central London is cheap… £ cost of Central London property based on different exchange rates (Oct 2007= 100)

9111 In 2010 HNW population was 10.8m: 2000 buyers for each London property The scares resource: Volumes fall by 59%… Annual actual transaction volumes from

Current growth is spot on long term trend… London Central actual growth versus long term average growth (1995= 100) 9% p.a.

Significant Growth Projected Anticipated price growth for Prime London Central residential property Savills (+19%) JLL (30%) Knight Frank (+18%) Source: Jones Lang LaSalle 'On Point', Savills Residential Research, Knight Frank Residential Research LCP (36%) Index 2012 = 100

Central London is not just for the globally rich… Social Housing: 25% versus 18% Empty Homes: 1.4% vs 1.1% Private Rented Sector: 38% vs 17% Young, between 25 – 44: 40% vs 27% Cosmopolitan Not Born in the UK: 53% vs 13% Second Homes: 5.6%

New residential property taxes... 7% for £2m+ 15% for £2m+ for certain NNPsCapital Gains Tax Annual Tax For Enveloped Dwellings Carve-outs Good News For Investors …For Now!

But more taxes in pipeline…

GDP in Westminster > any other London borough £100,000 students at world top universities Tourism and night time economy: 8bn p.a. PRS contributes £1.5bn p.a to economy and £0.5bn to the Exchequer

Global capital – the jewel in the crown Our 6 th biggest import Many drivers for growth in PLC... Enormous in terms of impact Tiny in terms of size Long and short term indicators do not suggest a bubble, but continued buoyancy