A Leading Global Commercial Real Estate Company. Buy, Hold, Sell Real Estate as Single Assets and Portfolios 25% CAGR

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1 GE Real Estate GE Real Estate Michael Pralle President & Chief Executive Officer, GE Real Estate October 29, 2003 This presentation includes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in global economic, business, competitive, market and regulatory factors. More detailed information about those factors is contained in GE's filings with the Securities and Exchange Commission. This presentation includes certain non-gaap financial measures as defined under SEC rules. As required by SEC rules, at the end of this slide presentation we have provided a reconciliation of those measures to the most directly comparable GAAP measure and a copy of the relevant slides is available on our investor relations website. Business Context A Leading Global Commercial Real Estate Company Buy, Hold, Sell Real Estate as Single Assets and Portfolios 25% CAGR Across Multifamily, Residential, Office, Industrial Asset Classes Around the World Finance Purchase of Real Estate by 3 rd Parties in Multiple Asset Classes Help Borrowers Who Wish to Re-capitalize Their Portfolios Restructure Existing Financing Through Additional Lending Opportunistically Own Companies Like Storage and Parking Where Our Expertise Allows Us to Unlock Under-Valued Real Estate Assets $75 $ '93 '95 '97 '99 '01 '03 NET INCOME CFPA900 SA Pralle Real Estate/2

2 Global Growth Accelerates NEAs ($B) Net Income ($MM) CAGR $28 CAGR 2 $ Intn l U.S. $18 32% $22 33% 37% Intn l $340 29% $528 40% 42% U.S. '99 '01 '03E '99 '01 '03E Continued Focus On Global Growth & Maximizing Portfolio Value In Current Market Conditions CFPA900 SA Pralle Real Estate/3 Then And Now Loan-to-Value 80 85% 78% Cash-on-Cash-Debt % Cash-on-Cash-Equity N/A 8.7% Debt Service Coverage 1.3x 2.2x Geography US Large Cities Global in 20 Countries (e.g., NYC) Lending Limits Single Assets Cross Collateralized, Up to $250MM $75MM Max Single Asset Focus Office, Multi-Family, Multi-Family, Retail, Residential Construction Office, Industrial, Storage,Parking, CMBS,Corp Outsourcing More Diversification Less Portfolio Risk CFPA900 SA Pralle Real Estate/4

3 Diversified Business Mix Net Earning Assets: $28B Assets By Region Collateral Type Properties By Inv. Size Operating Platforms 1 Other 1 Apt 18% $1MM- 5MM 39% Australia Mexico Canada 5% Europe 1 Asia USA 47% Warehse. 9% Storage Retail Office 33% Hotel <$1MM 33% $50MM- 100MM $10MM- 50MM 12% $5MM- 10MM 15% Average Deal Size $10MM Reduced Exposure Through Collateral Mix & Investment Limits CFPA900 SA Pralle Real Estate/5 Portfolio Quality 1.5% 0.5% Delinquency Trend 1.5% 0.7% 1.9% 0.5% % 1.* 0. '99 '00 '01 '02 3Q'03 Commercial Banks GE Real Estate * Estimate Source: Federal Reserve Board Approach Excellent Portfolio Quality 0. Delinquency 78% Loan-to-Value 2.2x Debt Service Coverage Strong Independent Valuation Team 144 People Globally Consistent Underwriting Standards Local Market Knowledge Onsite Property Diligence Strong Global Asset Management Network 220+ Professionals Averaging 10+ Years Experience Proactive Portfolio Monitoring CRE Delinquency At 1/16 th Of Commercial Banks CFPA900 SA Pralle Real Estate/6

4 Global Commercial Real Estate Market World Commercial Re Market Cap 2002: $10+ Trillion U.S. Brazil Canada Mexico Austrailia India South Korea China Japan Netherlands Spain UK Italy France Germany 5% 19% 4 3% 2% 0% 2% Americas As Markets Begin To Bottom, Buying Opportunities Should Emerge (e.g. MF, Office) Europe Public To Private Opportunities Equity Constraints Pushing Corporate Outsourcing Asia Values At 10 Year Lows In Select Markets NPL Opportunities; Japan, Taiwan, China Trillions Of Private Real Estate Providing Growth Opportunity CFPA900 SA Pralle Real Estate/7 Proactive Measures Our Response Raised Underwriting Bar Focus on Portfolios Tightened U/W Standards with Higher LTV and COC Requirements Conscious Decision to Grow Selectively Avoid Single Office, Hospitality Industry and High Hurdle Markets Targeted Growth in Attractive Markets Accelerated Asset Sales Accelerated France, Spain & Japan USA Opportunistically Sold Down: Leveraged Equity Investments Preferred Stock Positions Defensive Actions Taken Early CFPA900 SA Pralle Real Estate/8

5 Targeted Growth Strategy Model Has Changed; New Requirements for Success: Value Creation Opportunities; e.g. Corporate Outsourcing Portfolio Buys at Wholesale; Sell at Retail; e.g. MEPC Investing With Structural Downside Protection Continue to Build Annuity Income Buy and Hold Equity Investments with Strong Gross Margins; e.g. A Family of REITs High Quality Debt Lower Leverage Platform Purchases, e.g. Security Capital Improve Companies Continuous Focus on Cost Opportunities After Building Cash Flow, Exit Opportunistically Focus On Value Creation, Cost And Opportunistic Buys CFPA900 SA Pralle Real Estate/9 Opportunistic Public to Private Investments European Public Real Estate Companies Trading at Significant Discount to NAV European Current Discounts to NAV 50% 45% 40% 35% 30% 25% 20% 15% 5% 0% Benelux France Italy Spain Sweden UK Other Gross NNNAV Source: Merrill Lynch, Real View Based on ML coverage of 118 companies ($59B Mkt Cap) Market Inefficiencies Providing GE With Unique Opportunity NAV Calculation No clearly defined methodology to calculate NAV NAV is a trailing indicator Capital Structures Many companies inefficiently leveraged and capital constrained Tax Treatment Most countries do not have tax exempt status for property companies (i.e. REITS) Lack of Liquidity Except for a few Top Tier companies, many companies are thinly traded Analyst Coverage Smaller companies below analysts radar screen GE The Ideal Player To Take Advantage Of The Current Valuation Gap CFPA900 SA Pralle Real Estate/10

6 Annuity Income - Japan Asia Pacific Markets Improving Markets are Strong and Stable in Korea and Australia First Signs of Economic Recovery Class A Office vacancy peaked, with leasing activities reflecting consolidation and relocation; rents predicted to firm next months Demand for Studio (<40SM), Standard (40-60SM) and Family (60-100SM) residential units remains high Increase in Asset / NPL Sales 8% 2% 1 month Yen LIBOR Central Tokyo Office Building Yield (NOI / Asset Value) 10-Year JGB Rate 500 bps 0% Source: Sumitomo Trust Property Index 02-03,Sumitomo Trust, Bank of Japan Homepage, British Bankers Association MM SF 5 RE Arbitrage Tokyo Office Trends 9. Foreca st 7.7% 0 2% (5) 0% New Demand New Supply Vacancy Rate Source: Ikoma CB Richard Ellis 12% 8% CFPA900 SA Pralle Real Estate/11 Security Capital Acquisition ($B) Acquired $5.6B Diversified Real Estate Portfolio Other 2 Assisted Living 3% Storage Net Income Profile $52MM $150MM E Run Rate Parking 15% Grocery Anchored Retail 17% 3,000 Properties 6 Asset Classes Opportunistic Asset Management Regency, Prologis... $102MM Net Gains in Ongoing Process Executing On Strategy Operating Excellence & Value Optimization CFPA900 SA Pralle Real Estate/12

7 Summary Strong Portfolio Quality Continued Risk Vigilance Asset & Net Income Diversification Selective Global Growth Opportunistic Asset Management NI ($MM) 22%+ $ $650 '02 '03E Safely Positioned For Consistent Growth CFPA900 SA Pralle Real Estate/13

8 Commercial Finance Summary Huge Opportunity To Grow Globally Share + Geography Premier Direct Origination Team Opportunistic & Strategic Acquisitions Implement Industry Verticals Broad Spread Of Risk / Small Hold Positions Secured By Assets We Know Consolidate Backrooms for Productivity ~15%% $3.2B $ B '02 '03E Consistent, Double Digit Earnings Growth CFPA900 SA Pralle Real Estate/15 GE Commercial Finance 03 Financials Net Income ~$ B ~15+% 17+% ROE Assets ~$ B 10+% Risk Management 0. Losses As % Avg. Invest Continue To Outperform Reduce Expenses Productivity As % Investment 3% $100MM Benefit Acquisitions $13B Assets ~$180MM Net Income Consistent, Double-Digit Earnings Growth CFPA900 SA Pralle Real Estate/16