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Tony Smedley, Head of Continental European Real Estate Investment Andrew MacDonald, Head of Real Estate Finance Jeff O’Dwyer, Investment Manager 25 May 2017 For professional investors only. This material is not suitable for retail clients Schroder European Real Estate Investment Trust Interim results presentation

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Tony Smedley, Head of Continental European Real Estate Investment Andrew MacDonald, Head of Real Estate Finance Jeff O’Dwyer, Investment Manager

25 May 2017 For professional investors only. This material is not suitable for retail clients

Schroder European Real Estate Investment Trust Interim results presentation

Agenda

01 Highlights

02 Portfolio, asset management and markets

03 Financial review

04 Summary and outlook

1

Highlights

The European growth city strategy Nearing full investment and growing income

3

Investment Finance Growth strategy European Markets

− Acquisitions: €56.2m invested in Paris and Seville

− Portfolio: €209m1 in nine retail/office assets with high occupancy, 4.8yr lease length

− Income: portfolio yield 6.1%; over 8% post debt (pre costs)

− Value growth: 2.5% increase in portfolio value over the period1

− NAV: €175.9m NAV as at 31 Mar (€1.315 p.s.), representing NAV total return of 2.5% since 30 Sept

− EPRA Earnings: €2.6m for 6 months, compared to €1.0m for 10 months to Sept 2016

− Dividends: 2.2 Euro cents p.s. declared for half-year period, 29% increase over the prior half year

− Debt: Post Seville LTV now 26% at interest cost of 1.30%, 7.3 years duration

− Capital: €16.7m equity raised in October

− Growth cities: Portfolio located in fastest growing cities in Europe

− Megatrends: urbanisation, infrastructure, demographic change

− Markets: rents rising, voids falling, asset price growth continues; premium to fixed income supportive

− Market presence: deep local market knowledge and access of Schroder teams

− Dividend: On track for target 5.5% once fully invested2

− Pipeline: Active negotiations to deploy €30m remaining capacity

− Accretive growth: raise equity to grow portfolio

− Scale benefits: improves diversification, liquidity and cost economies

Source: Schroders, May 2017/Data: 1Portfolio market value is based on 31 March 2017 independent valuation, includes 50% share of €52.5m Seville asset acquired post period end. 2Dividend is only a target and yield based on IPO issue price in Euro. Past performance is not a guide to future performance and may not be repeated.

Portfolio, asset management and markets

Portfolio evolution Invested €209m1, 9 assets in France, Germany and Spain

Source: Schroders, May 2017. For illustrative purposes only and should not be viewed as a recommendation to buy or sell. 1Portfolio market value is based on 31 March 2017 independent valuation, includes 50% share of €52.5m Seville asset committed post period end.

5

Jan 2016

€0 €209m1

2017

Retail Warehouse Berlin, Germany

Office Stuttgart, Germany

Retail Frankfurt, Germany

Retail Rennes, France

Office Paris, France

Office St. Cloud, Paris, France

Retail Biarritz, France

Office Hamburg, Germany

Retail Seville, Spain

Recent acquisitions Paris and Seville

6

St. Cloud, Paris, France

Purchase Price c. €30m / c. €2,000 psm / 9.5% NIY

Location Saint-Cloud, an upscale mixed use suburb in West Paris

Description 15,800 sqm office premises; the best quality space in a larger 65,000 sqm office complex; fully leased; multi-tenanted; modest rents of €215/sqm. Next to future Grand Paris train station

Asset Management

Refurbish lift lobbies; re-gear leases to maintain attractive NIY and extend WAULT

Strategy Re-gear leases Light refurbishment

Metromar Shopping Centre, Seville, Spain – 50% share

Purchase Price c. €52.5m (100%) / c. €2,200 psm / 6.2% NIY

Location Mairena del Aljarafe, a growing suburb of Seville

Description

23,500 sqm urban shopping centre servicing a catchment of 250,000 people within 15 minutes drive. Strong tenant mix Zara, Mango, Pull & Bear, Mercadona supermaket with a leisure point of difference (cinemas / restaurants)

Asset Management

Lease vacancy, improve leisure offer, improve brand / signage / wayfaring / lighting and general vibrancy

Strategy Lease vacancy Place making

Portfolio Overview Nine institutional grade assets in growth cities

7

Source: Schroders, May 2017.

City Acquired Country Sector Valuation €m

No. Tenants

Contracted rents €m

WAULT to break yrs

Void %

Paris (Boulogne) Q1 2016 France Office 41.5 1 2.4 4.0 0.0 Paris (Saint-Cloud) Q1 2017 France Office 33.0 12 3.1 2.5 0.0 Biarritz Q2 2016 France Retail 21.6 8 1.3 4.4 1.0 Rennes Q2 2016 France Retail 18.8 1 0.9 5.2 0.0

France Subtotal 115.0 23 8.4 3.6 0.1 Berlin Q1 2016 Germany Retail 25.3 1 1.6 8.8 0.0 Hamburg Q2 2016 Germany Office 16.1 16 1.2 7.0 0.4 Stuttgart Q2 2016 Germany Office 14.9 4 0.8 8.3 0.4 Frankfurt Q2 2016 Germany Retail 11.4 6 0.7 6.8 0.0

Germany Subtotal 67.7 27 4.3 7.8 0.2 Subtotal 31/03/2017 182.7 50 12.0 5.1 0.2

Seville, Metromar Q2 2017 Spain Retail 26.3(1) 53 2.1 3.0 2.5 Total including post quarter completion 208.9 103 14.1 4.8 0.5

51% 49%

Office Retail

55% 32%

13%

France Germany Spain

20%

12%

8% 7% 5% 9%

10%

16%

13%

Paris (B-B) Berlin HamburgStuttgart Frankfurt RennesBiarritz Paris (SC) Seville

Property allocation Sector allocation Country allocation

Lease expiry to earliest termination WAULT

Tenant overview Over 100 tenants and weighted average lease term of 4.8 years

8

Source: Schroders, May 2017. *City BKK is part of a national insurance co-operative which mitigates their risk assessment as the co-operative must cover the liabilities of all members.

– Portfolio weighted average unexpired lease term of 4.8 years – Seville: c.3 years due to rolling breaks prevalent with the larger

retailers (e.g. Inditex Group and cinema). This is mitigated by the fact that these retailers are trading well (sustainable effort ratios) and are long term occupiers (since 2007)

– Paris (St.Cloud): nature of tenant profile (SME’s) results in shorter term leases. Good progress being made with lease re-gears/extensions

Top 10 tenants Sector City Rent p.a.

WAULT to earliest expiry years Credit risk assessment € m % of total

1 ALTEN Technology Paris (Boulonge) 2.3 19% 4.0 Low 2 Casino Grocery Retail Rennes & Biarritz 1.9 15% 5.2 Low 3 Hornbach Retail Berlin 1.6 13% 8.8 Low 4 City BKK Insurance Hamburg 0.8 7% 7.9 High* 5 Land Baden-Württemberg Government Stuttgart 0.7 5% 8.9 Low 6 Thesee (Leyton) Consultancy Paris (Saint Cloud) 0.6 5% 2.4 Medium 7 Ethypharm Pharmaceutical Paris (Saint Cloud) 0.6 5% 0.8 Low 8 Filassistance Insurance Paris (Saint Cloud) 0.5 4% 2.2 Low 9 Garantie assistance Insurance Paris (Saint Cloud) 0.4 3% 5.2 Low 10 Moody's Analytics Financial Paris (Saint Cloud) 0.4 3% 2.3 Low Subtotal 9.6 68% 5.1

Remaining Tenants 4.4 32% 3.7

Total 14.1 100% 4.8

SEREIT’s Investment Universe SEREIT’s portfolio vs. Investment Universe

Exposure to higher GDP growth, winning centres SEREIT portfolio located in highest growth regions of Western Europe

9

Source: Oxford Economics, Schroders. May 2017 –Total of 9 assets as at last valuation. Investment universe consisting of 1043 NUTS3 regions in countries shown on map. Data based on Oxford Economics’ GDP growth forecasts end-2016–end 2021 as at April 2017.

Outer ring shows SEREITs direct exposure as a % of value

47%

29%

19%

5%

80%

20%

Fastest Growing RegionsSecond QuartileThird QuartileSlowest Growing Regions

Inner ring shows

average for investment

universe

90

95

100

105

110

115

120

125

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

GDP growth and forecast GDP growth forecast 2017–2021

European economies continue to grow GDP growth forecasts

10

Source: Oxford Economics, Schroders. April 2017. The forecast should be regarded as illustrative of trends. Actual figures will differ from forecasts. Please refer to Important Information regarding forecasts. Countries mentioned are for illustrative purposes only and not a recommendation to buy or sell.

2008 = 100

Germany

Spain

Italy

Sweden

0.0 0.5 1.0 1.5 2.0 2.5

Italy

Germany

Austria

Portugal

Finland

Netherlands

France

Belgium

Denmark

Norway

Sweden

UK

Spain

France

Finland

Forecast

Netherlands

(% p.a.)

Office employment: Forecast growth in absolute employment between end-2016 to end-2021

ILO-Unemployment rates

Labour markets continue to recover Unemployment falling – strong growth in office employment

11

Source: PMA, Oxford Economics, April 2017. The forecast should be regarded as illustrative of trends. Actual figures will differ from forecasts. Please see the information slide at the end of this presentation. Countries mentioned are for illustrative purposes only and not a recommendation to buy or sell.

(%)

0.0% 2.5% 5.0% 7.5% 10.0% 12.5% 15.0% 17.5% 20.0%

MilanHelsinkiBrussels

DusseldorfRotterdam

CopenhagenVienna

ParisBarcelona

LisbonStuttgart

MunichHamburg

LyonFrankfurtCologne

OsloAmsterdam

MadridBerlin

StockholmLuxembourg

2.0

4.0

6.0

8.0

10.0

12.0

14.0

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Germany France Italy Netherlands Sweden

Average GDP Growth 2017–2021

Focus on growth – Cities not countries Major cities and regions enjoy faster economic growth

12

Source: Oxford Economics, Schroders. April 2017. The forecast should be regarded as illustrative of trends. Actual figures will differ from forecasts. Please refer to Important Information regarding forecasts. Countries mentioned are for illustrative purposes only and not a recommendation to buy or sell.

% p.a.

0.5

1.0

1.5

2.0

2.5

3.0

Mad

ridSe

ville

Barc

elon

aSp

ain

Stoc

khol

mSw

eden

Osl

oN

orw

ay

Cope

nhag

enD

enm

ark

Zuric

hSw

itzer

land

Brus

sels

Belg

ium

Paris

Fran

ce

Amst

erda

mN

ethe

rland

s

Hel

sink

iFi

nlan

d

Berli

nH

ambu

rgSt

uttg

art

Dus

seld

orf

Mun

ich

Fran

kfur

tG

erm

any

Mila

nRo

me

Ital

y

European occupier activity remains high Broad based recovery in occupier demand

13

Source: JLL, Schroders. April 2017. Country figures based on major markets. Countries mentioned are for illustrative purposes only and not a recommendation to buy or sell.

01,0002,0003,0004,0005,0006,0007,0008,0009,000

10,00011,00012,000

Q2

2006

Q4

2006

Q2

2007

Q4

2007

Q2

2008

Q4

2008

Q2

2009

Q4

2009

Q2

2010

Q4

2010

Q2

2011

Q4

2011

Q2

2012

Q4

2012

Q2

2013

Q4

2013

Q2

2014

Q4

2014

Q2

2015

Q4

2015

Q2

2016

Q4

2016

Germany France UK and Ireland Italy BeNeLux Iberia Sweden

12m tolling Totals ‘000 sq m

Office vacancy is falling Current vacancy in some markets just above 1–2y worth of take-up

14

Source: JLL, Schroders. April 2017.

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

Q4

'07

Q2

'08

Q4

'08

Q2

'09

Q4

'09

Q2

'10

Q4

'10

Q2

'11

Q4

'11

Q2

'12

Q4

'12

Q2

'13

Q4

'13

Q2

'14

Q4

'14

Q2

'15

Q4

'15

Q2

'16

Q4

'16

Vacancy rate %

Paris

Berlin

Madrid

Stockholm Amsterdam Frankfurt

London

European real estate and bond yields Real estate yield spread over bonds remains attractive

15

Source: Bloomberg, DTZ, PPR, Datastream, Schroders, February 2017. Note *10 Year Bonds are unweighted average of French and German government bonds. The forecast should be regarded as illustrative of trends. Actual figures will differ from forecasts. Please refer to Important Information regarding forecasts.

Office yields and 10 year government bonds Initial yields %

0

1

2

3

4

5

6

7

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Prime Office vs Bond Yield Gap Prime European Office Yield Avg European 10Y Bonds*

Forecast

Investing through the cycle Focus on occupier requirements and long-term trends/value

16

Source: Schroders, November 2016.

Office Others

Real estate which stands to gain from new technology, demographic change, urbanisation

Adaptable to changing occupier needs

Competing uses and good or improving infrastructure

Gro

wth

mar

kets

Retail

– Modern offices in improving areas

– Re-positioning offices in city centres

– Modern, central in smaller growth cities

– Grocery and convenience

– Flagship stores – city centres / tourist centres

– Shopping centres dominating catchment

– DIY + big boxes

Types which are internet immune

– Logistics: med + small – Data centres – Hotels – Leisure properties – Care homes

Understand occupiers’ business models Competing uses

Potential for change of use

The European growth city strategy Pipeline to deploy remaining capital (€30m)

17

Source: Schroders, May 2017. Countries mentioned are for illustrative purposes only and not a recommendation to buy or sell.

Opportunity Country Sector Pricing Yield Profile Comment

1 Urban Logistics Portfolio Spain Logistics €31m 6.0% Core

5 parcel delivery assets in the 3 largest cities of Spain - Madrid (3), Barcelona and Valencia. c.6 year WAULB, good spec

2 Petrol Station Portfolio Spain Alternative €51m 7.5% Core+

Portfolio of 19 fuel stations in high growth areas of Northern Spain, located beside dominant grocery stores. Scope for alternate use subject to planning

3 Brussels Logistics Belgium Industrial €20m 6.3% Core+ Logistics asset southern edge of Brussels, close to major ring road

4 Utrecht Netherlands Office €13m 5.8% Core

City centre, close to central station and main high street. 15 year lease to strong covenant let at discount to market rent

Total €115m 6.5%

Financial review

Financial Highlights

19

NAV of €175.9m (131.5 cents per share (‘cps’) / 111.7 pence per share (‘PPS’)) – Increase of 11.4% over the period, including gross equity raise of €16.7m – NAV total return over the half-year of 2.5%, despite incurring acquisition and equity issue costs

EPRA earnings of €2.6m for 6 month period (2.0 cps / 1.7 pps) compared to €1.0m (0.9 cps) for 10 months to 30 September 2016 ‒ Annualised gross rental income grown to €14.1m post Seville, from €8.7m for the portfolio as at 30

September 2016 Second interim dividend declared of 1.2 cents per share

− 20% increase in dividend over the quarter – 99% covered from net income over the quarter – Represents annualised dividend yield of 3.5% – Total dividends declared relating to half year of 2.2 cents per share

New accretive loan drawn post period end against Seville asset; overall LTV is 26% at a weighted average interest rate of 1.30% and a weighted duration of 7.3 years

Approximately €30m of remaining investment capacity (including debt) post Seville acquisition

Source: Schroders, May 2017. Past performance is not a guide to future performance and may not be repeated.

Post period end: – Acquisition of 50% share in a shopping centre in Seville for a price c. €26.3m (SEREIT share) – New loan of €11.7m (SEREIT share) drawn against Seville acquisition

NAV movement over interim period 2.5% NAV total return underpinned by valuation growth

20

Source: Schroders *NAV as at 30 Sept 2016 based on number of shares pre Oct 2016 equity raise (121.2m shares). All other numbers based on number of shares post equity raise (133.7m shares). Numbers based on proportionally consolidated basis and therefore represent SEREITs share of joint ventures.

€m cps Comments

NAV as at 30 September 2016* 157.8 130.2

Net Equity raise 16.4 0.1 Placing in October 2016

NAV post equity raise 174.2 130.3

Transaction costs of investments made during the period (3.0) (2.2) Mainly acquisition costs for the Saint Cloud acquisition

Unrealised gain in valuation of the property portfolio 4.6 3.4 Paris (St. Cloud) €3.0m, Berlin €0.4m, Hamburg €0.7m,

Stuttgart €0.2m and all other assets €0.3m

Post tax net revenue 2.6 1.9 Rental income net of operating expenses and finance costs. Breakdown on slide 21

Dividends paid (2.5) (1.9) Dividend for Jul – Sept (0.9 cents ps) and Oct-Dec (1.0 cents ps) paid during period

NAV as at 31 March 2017 175.9 131.5

Total funds including debt

Summary balance sheet and investment capacity Building a €200m+ investment portfolio with low leverage

21

Numbers based on proportionally consolidated basis and therefore represent SEREITs share of joint ventures. *FX rate of £1 : €1.1778 as at 31 Mar 2017 (FX Rate: 31 Dec 2016 £1 : €1.17310, 30 Sept 2016 £ : €1.1543).

– During the period €16.7m of gross equity was raised in October equity placing

– Post period end: – Acquisition of 50% share in a shopping centre in Seville for a

price c. €26.3m (SEREIT share) – New loan of €11.7m (SEREIT share) drawn against Seville

acquisition – Remaining investment capacity is c. €30m, including additional

leverage

As at 31 Mar 2017 (€m) As at 30 Sept 2016 (€m)

Investment properties 182.5 148.0

Cash 42.6 58.4

External third-party loans (48.0) (48.1)

Net current liabilities (1.2) (0.5)

NAV 175.9 157.8

NAV per share €/£* €1.315 / £1.12 €1.301 / £1.13

88%

12%

Invested Available

Income statement for interim period Property acquisitions generating income growth

22

Source: Schroders, May 2017. Past performance is not a guide to future performance and may not be repeated. *European Public Real Estate Association (“EPRA”).

Growth in annualised gross rental income

6 mths to 31 Mar 2017 (€m) 10 mths to 30 Sept 2016 (€m)

Net rental and related income 4.9 3.6

Total Fees and Expenses (1.9) (2.5)

Net finance costs (0.4) (0.1)

Underlying EPRA* earnings 2.6 1.0

€’million

0

5

10

15

30-Sep-16 31-Dec-16 31-Mar-17 Post Seville

Paris - Boulogne Berlin Hamburg Stuttgart Frankfurt Rennes / Biarritz Paris - St. Cloud Seville

€8.7m €8.7m

€12.0m

€14.1m

– Once fully invested, targeting annualised euro dividend yield of 5.5%1

– Dividend of 1.2 Euro cents per share declared in respect of period January – March, payable in July 2017 – Represents annualised dividend yield of 3.5% – Increase from 1.0 Euro cents per share for Oct – Dec, equating to quarterly increase of 20% – 99% covered from net income – Will grow towards target yield as deployment completed e.g. receipt of Metromar income from May 2017

Further progress on delivering dividend target Dividend yield target of 5.5%1 p.a.

23

1Yield based on the Euro equivalent of the issue price as at admission. This is a target only, based on a number of assumptions that may not materialise. There can be no guarantee that this target will be met. Source: Schroders, May 2017.

Growth in dividend per share € cents p.s.

0.8 0.9

1.0 1.2

0.0

0.2

0.4

0.6

0.8

1.0

1.2

Q3 2016 Q4 2016 Q1 2017 Q2 2017

Loans Summary as at 31 March 2017 Post Period End

Debt Strategy

Debt financing Current borrowing rates accretive to income returns

24

Source: Schroders, May 2017.

– Portfolio gearing capped at 35% LTV; loans targeted against assets where most accretive and may be up to 50% LTV

– Seven of the nine portfolio assets have gearing secured against them; the two Paris offices are currently ungeared

– Property level income returns from existing portfolio increased from 6.1% to over 8% post gearing (pre costs and expenses)

– Different loan maturities to spread refinance risk; interest only to maximise income distribution

– 100% of interest rate exposure either fixed or capped

– Likely to put debt finance against future acquisitions, taking gearing to around 35%

Seville Acquisition MetroMar Shopping Centre JV Completed post period end

Loan Term 7 years

LTV 45%

Loan €11.7m

Margin 1.31%

Fixed Base Rate 0.45%

Total Interest Rate 1.76%

Fund level post Seville Weighted average

Loan Term 7.3 years

LTV (vs. Company GAV) 26%

Total Loans €60.4m

Blended margin 1.14%

Blended Base Rate 0.16%

Total Blended Interest Rate 1.30%

Loan Loan Amount Maturity Interest Rate

Hamburg/Stuttgart €14.0m June 2023 0.85%

Frankfurt / Berlin €16.5m June 2026 1.31%

Casino €18.2m July 2023 1.35%

Total €48.7m 7.3 Years 1.19%

Summary and outlook

– Acquisitions in Seville and Paris take the Company close to full investment and grow net income

– High quality portfolio of over €200m located in growth cities across France, Germany and Spain

– Strong income profile with c. 100% occupancy and 4.8 year average lease length

– Low cost, long duration debt financing at 26% LTV – accretive to income return

– Dividend increased by 20% over the quarter to 3.5% p.a.; further progress made on delivering target dividend yield of 5.5% when fully invested1

– Investor and occupier activity in target markets remains strong post Brexit vote; rents continue to rise

– Megatrends (e.g. urbanisation, infrastructure investment) support long-term focus on growth cities

– Identified pipeline of attractive investment opportunities to deploy remaining capital

– 2017 targeting further accretive investments and equity issuances to fulfil growth ambitions; scale will improve share liquidity and cost economies

The Company investing in European growth cities Nearing full investment with potential for further growth

26

1Yield based on the Euro equivalent of the issue price as at admission. This is a target only, based on a number of assumptions that may not materialise. There can be no guarantee that this target will be met. Source: Schroders, May 2017.

Important information

27

For professional investors or advisers only. This material is not suitable for retail clients. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested. The views and opinions contained herein are those of Tony Smedley, Head of Continental European Real Estate Investment, and Andrew MacDonald, Head of Real Estate Finance , and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This presentation is for information purposes only and it is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument Information herein is believed to be reliable but Schroder Real Estate Investment Management Ltd (‘SREIM’) does not warrant its completeness or accuracy. This does not exclude or restrict any duty or liability that SIM has to its customers under the Financial Services and Markets Act 2000 (as amended from time to time) or any other regulatory system The forecasts included in this presentation should not be relied upon, are not guaranteed and are provided only as at the date of issue. Our forecasts are based on our own assumptions which may change. We accept no responsibility for any errors of fact or opinion and assume no obligation to provide you with any changes to our assumptions or forecasts. Forecasts and assumptions may be affected by external economic or other factors. Schroder European Real Estate Investment Trust risk factors: Companies which invest in a smaller number of assets carry more risk than those spread across a larger number of assets. The Company may invest solely in property located in one country or region. This can carry more risk than investments spread over a number of countries or regions. The Company may borrow money to invest in further investments, this is known as gearing. Gearing will increase returns if the value of the assets purchased increase in value by more than the cost of borrowing, or reduce returns if they fail to do so. The fund holds investments denominated in currencies other than sterling, changes in exchange rates will cause the value of these investments, and the income from them, to rise or fall. The dividend yield is an estimate and is not guaranteed. Use of IPD data and indices: © and database right Investment Property Databank Limited and its Licensors 2013. All rights reserved. IPD has no liability to any person for any losses, damages, costs or expenses suffered as a result of any use of or reliance on any of the information which may be attributed to it Issued in May 2017 by Schroder Real Estate Investment Management Limited, 31 Gresham Street, London EC2V 7QA. Schroder Real Estate Investment Management Limited is authorised and regulated by the Financial Conduct Authority. Registration number 1188240 England. UK11874

Contact Schroder Investment Management Limited,

31 Gresham Street, London EC2V 7QA.

schroders.com