ING OFFICE FUND Acquisition of Bastion Tower, Brussels and Institutional Placement of $70.0m

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1 ING OFFICE FUND Acquisition of Bastion Tower, Brussels and Institutional Placement of $70.0m 1 November

2 DISCLAIMER NOT FOR DISTRIBUTION OR RELEASE IN THE UNITES STATES OR TO U.S. PERSONS This presentation was prepared by ING Management Limited (ABN ) (the "Responsible Entity") in respect of ING Office Fund ("IOF"). This presentation is provided for information purposes only and does not constitute an offer, invitation, solicitation or recommendation with respect to the subscription for, purchase or sale of any security, and neither this document nor anything in it shall form the basis of any contract or commitment. This presentation does not constitute investment, legal, taxation or other advice and the presentation does not take into account the investment objectives, financial situation nor needs of any particular investor. Accordingly, no action should be taken on the basis of, or in reliance on, this presentation. Except as required by law, no representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions, or as to the reasonableness of any assumption, contained in this presentation. By receiving this presentation and to the extent permitted by law, the Recipient releases the Responsible Entity its affiliates or any of their respective directors, officers, employees, representatives or advisers from any liability (including, without limitation, in respect of direct, indirect or consequential loss or damage or loss or damage arising by negligence) arising in relation to any recipient relying on anything contained in or omitted from this presentation. The forward looking statements included in this presentation involve subjective judgment and analysis and are subject to significant uncertainties, risks and contingencies, many of which are outside the control of, and are unknown to, the Responsible Entity. In particular, they speak only as of the date of these materials, they assume the success of IOF's business strategies, any they are subject to significant regulatory, business, competitive and economic uncertainties and risks. Actual future events may vary materially from forward looking statements and the assumptions on which those statements are based. Given these uncertainties, readers are cautioned not to place undue reliance on such forward looking statements. No action has been taken to register securities of IOF or otherwise permit a public offering of IOF securities in any jurisdiction. The securities to be offered and sold in the placement have not been and will not be registered under the U.S. Securities Act of 1933 (the Securities Act ) and may only be offered and sold (i) within the United States, or to or for the account or benefit of, any U.S. Person in transactions exempt from the registration requirements of the Securities Act or (ii) outside the United States, to non-u.s. Persons in offshore transactions in compliance with Regulation S under the Securities Act. The distribution of this document outside Australia may be restricted by law. In particular, this document or any copy of it must not be taken into or distributed or released in the United States or distributed or released to any U.S. Person as defined in the Securities Act. Persons who come into possession of this document should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. 1

3 ACQUISITION OVERVIEW Landmark asset in Brussels CBD Rare high-rise, multi-tenanted asset Core location in prestigious European quarter Attractive total return prospects Stable office market Washington D.C. of Europe Off-market opportunity sourced through ING Real Estate global platform 2

4 INVESTMENT RATIONALE Competitive asset > Core location in prestigious office district > Unique asset as one of only 5 high rise towers in CBD > Excellent access to public & private transport, high car parking ratio, great views > High quality and diverse tenancy mix > Fully refurbished in 1995, all plant equipment replaced in 2002 Stable market > Consistent tenant demand underpinned by EU, European Parliament and NATO > Low supply risk with minimal developable land available in CBD > Planning restrictions prevent the building of new high-rises Attractive metrics > Discount to valuation > Attractive total return prospects 3

5 PROPERTY DETAILS Purchase price: 142.4m (100%) Valuation: 145.5m (100%) Occupancy: 94% Initial Net Yield: 5.4% Passing Rent: Market rent: Area: Parking: 235sqm net 245sqm net 33,290sqm 510 bays Lease expiry: 5.4 years (1) No. of Tenants: 16 Floors: 26 (1) Assuming break clauses exercised 4

6 PROPERTY DETAILS Unique design with large, flexible floor plates Major Tenants Industry One of only 5 office towers in CBD providing excellent views across the city High quality and diverse tenancy mix High car parking ratio 1:60sqm (market 1: ) Freshfields Servcorp Contassur Lactalis Societe Generale Legal Serviced Offices Insurance Consumer Goods Finance Direct access to major subway line and arterial road Property to be managed by INGRE Belgium Electrabel King Sturge European Venture Capital Energy Property Private Equity 5

7 BRUSSELS MARKET OVERVIEW 5 th largest European office market with 12.2m sqm Home to the European Union, European Parliament and NATO; second highest diplomatic presence in the world (after Washington D.C.) Continued expansion and growth of EU and affiliated groups provide stability to the Brussels office market Sound market rental growth outlook 6

8 BRUSSELS MARKET OVERVIEW Divided into 3 markets; CBD, Decentralised and Periphery CBD built-out and with height and planning restrictions Bastion Tower is located in Leopold, the most desirable sub-market in the CBD CBD Decentralised Periphery 7

9 LEOPOLD MARKET OVERVIEW Preferred location for EU service providers High-end retail and entertainment district Achieves highest rents in Brussels Limited new construction due to: > Little developable land > Strict planning restrictions Submarket Stock Vacancy rate Market rent (net) City Centre 3.5m sqm 6.8% sqm Leopold 3.3m sqm 7.2% sqm Louise 0.9m sqm 9.1% sqm Decentralised 2.5m sqm 13.7% sqm Periphery 2.0m sqm 19.0% sqm Total Brussels 12.2m sqm 10.0% CBD Decentralised Periphery > Site consolidation required 8

10 EUROPEAN OFFICE MARKET UPDATE European consumer relatively lowly leveraged Subprime impact minimal on EU economies Cap rates in Western European markets remain stable for high quality core assets Fundamentals continue to remain sound Majority of office markets in early upturn phase 9

11 TRENDS IN MARKET RENTS ACROSS EUROPE Q Q2 750 sqm Early up turn phase Madrid Barcelona Paris Munich Frankfurt Berlin Amsterdam Brussels Milan Prague Warsaw Stockholm Rental growth in early up-turn phase across most markets Brussels rents are attractive compared with other markets Source: PMA 10

12 PORTFOLIO & FUND IMPACT Introduces key European office market Weighting to Europe increases to 23% Gearing remains unchanged at 39% Accretive to earnings from Yr 1 onwards Improves European growth profile 11

13 RECENT FUND ACTIVITY Asset Market Price Investment Style Transaction Type Disposal 1 Adelaide Tce Perth A$87.0m Non core Off market Acquisition Wellington Central Perth A$81.5m(1) Long net lease Off market Acquisition Verizon Tower (50%) Virginia A$59.0m(2) Value add Subprime opportunity Acquisition Bastion Tower (50%) Brussels A$111.2m Core Off market Subprime crisis has resulted in more opportunities Vendors looking for certainty and purchaser credibility Less competition for assets given lack of leveraged/pe buyers INGRE global network well positioned to source attractive investments (1) Completion due March 2009 (2) US$/A$ = 0.89 at the time of acquisition 12

14 TRANSACTION FUNDING Sources Property level debt Placement proceeds TOTAL Applications Property acquisition Acquisition and capital raising costs Debt rebalance TOTAL A$(1) $67.9m $70.0m $137.9m $111.2m $3.5m $23.2m $137.9m Attractive interest rate and income hedging profile for 5 yrs > Debt 100% hedged at 4.2% (2) until Jan-10, henceforth 5.1% (2) until Oct-12 > Income 100% hedged based on forward curve (1) /A$ = 0.64 (2) Incl. margins 13

15 SUMMARY Core EU office market Washington DC of Europe Rare high-rise, multi-tenanted asset Prestigious office district Strong market dynamics and barriers to entry Acquired at discount to valuation Accretive to Fund earnings Unique asset acquired off market through INGRE global platform 14

16 PLACEMENT OVERVIEW Institutional placement of $70.0m at $1.72 per security New units to rank pari passu Entitlement to full Dec 07 quarter distribution Fully underwritten by Citi and JPMorgan 15

17 DETAILS OF OFFER Event Time Date Institutional offer opens 4:30pm 1 Nov Institutional offer closes to Asia & Australia 6:30pm 1 Nov Institutional offer closes to rest of the world 11:59pm 1 Nov Settlement - 8 Nov Allotment of securities - 9 Nov

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