Annually Received RPI Investment Sale with 23 years unexpired RIVERSWAY PRESTON LANCASHIRE PR2 2YQ

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1 Annually Received RPI Investment Sale with 23 years unexpired

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3 Investment Summary The property is let to Odeon Cinemas Ltd until 30th June 2038 giving an unexpired lease term of 23 years. UK s largest cinema operator with a 5A1 D&B rating. Annually received RPI linked rental increases (collared at 1.00%, capped at 5.00%). Running yield to reach 6.92% within 5 years assuming 3.62% RPI growth (the average Experian RPI forecast for ). The rentalisable area comprises 33,441 sq ft (10 screens). Current rent 622,018 per annum topped up to 641,176 per annum, based upon 3.08% RPI growth to July 2016 (Experian forecast). Significant increases in attendances for 2015 and forecast for Potential to install A3 unit in the car park subject to planning and 3rd party agreement. Located close to a large Morrisons foodstore and Mariner s Way Retail Park where tenants include Mothercare, DFS and Pets at Home. New 150 year lease at a peppercorn from November 2015 (in solicitor s hands). We are instructed to seek offers in excess of 10,100,000 (Ten Million, One Hundred Thousand Pounds), reflecting a net initial yield of 6.00% having allowed for purchaser s costs of 5.8% and assuming the vendor tops up the rent to 641,176 per annum to be reviewed on 1st July 2016 assuming 3.08% RPI growth (Experian RPI forecast).

4 Location Situation Preston is the administrative and retailing centre within the County of Lancashire. The city is located in the North West of England, approximately 48 km (30 miles) north west of Manchester and benefits from excellent transport infrastructure being located at the M6, M65 and M61 interchange. The property is situated in a prominent position on Port Way, the main road leading south from the A583 which acts as the main arterial road between Preston and Blackpool. There is one other multiplex cinema within a 20 minute drivetime, serving a population of nearly 300,000. This VUE Cinema, on Capitol Centre, Waltonle-Dale, is due to close in 2016 to be redeveloped for retail. Preston has a major railway station on the West Coast Main Line and provides a regular service to London Euston with a fastest journey time of 2 hour 15 minutes. Adjacent to the cinema is a Chiquito restaurant and in 2006 a KFC and two storey DW Sports Gym were constructed on the other side of Port Way. Across Preston Marina, approximately 500 meters to the north west is Mariners Way Retail Park, this includes a 79,000 sq ft Morrisons and retailers such as Halfords, Homebase, Pets at Home, DFS, Mothercare and Bensons for Beds. Investment Summary Location and Drive Times Description and Accommodation Aerial Tenancy & Running Yield Covenant Information Asset Management Proposal Home

5 COMPRESSOR CLEANER SWITCH ROOM DIS. WC MALE STAFF ROOM COLD PREP AREA OFFICE TAB MANAGERS FEMALE GAS IN 5 Description Internal Layout Plan Odeon Preston comprises a standalone 10 screen cinema with 1,895 seats. The main entrance has recently undergone a full refurbishment where the Costa franchise is located; this benefits from direct internal as well as external access. SCREEN 3 SCREEN 4 SCREEN 5 SCREEN 6 SCREEN 7 SCREEN 8 El The cinema was constructed in 1990 and comprises a steel frame with brickwork cavity walling that supports a flat roof, and a large pitched roof above the main entrance. In 2014, the flat roof s single ply membrane and insulation was fully replaced. The internal layout reflects a typical cinema operation. The complex is served by its own large car park, with 220 spaces. SCREEN 2 SCREEN 1 SCREEN 10 SCREEN 9 6 Cinema Sub Sta Garage Accommodation GROUND FLOOR PLAN 0m 10m 20m 30m NAVIGATION WAY Ordnance Survey Crown Copyright All rights reserved. Licence number Plotted Scale - 1:1250 Area (sq m) Area (sq ft) Gross Internal Area 3, ,910 Non-Rentalised Area ,469 Net Internal Area 3, ,441 Please note: Net Internal Area stated is Gross Internal area minus Non- Rentalised Area Site The site extends to a total of acres (1.452 hectares). There are 220 dedicated car parking spaces.

6 Rent annually reviewed in line with RPI Tenancy The premises are let on full repairing and insuring terms by Odeon Cinemas Ltd ( ) to 30 June The tenant guarantor being Odeon and UCI Cinema Holdings Ltd ( ). The premises are let on full repairing and insuring term to an enhanced hot shell specification (further details available on request). Any assessment of a market rent should make an allowance for this enhanced specification, typically an adjustment of 15%. The contracted rent is 622,018 per annum. The rent is subject to an annual upwards only review on the 1st July of each year of the term in line with the retail price index (RPI), collared at 1.00% per annum and capped at 5.00% per annum. The vendor will top up the rent to the next review (1 July 2016) to 641,176 pa, based upon the Experian forecast of 3.08%. Running Yield The rent is subject to annual upwards only reviews in line with RPI (collared at 1.00% pa and capped at 5% pa). Based on a purchase price of 10.10m and the topped up rent of 641,176, we outline below the yield profile based on the 1% pa collar and 3.62% pa (the average Experian s RPI forecast for ). 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Tenure Jul-17 Jul-18 Jul-19 Jul-20 1% RPI rate (Minimum uplift) Jul-21 Jul-22 Jul-23 Jul-24 Jul % RPI rate (Average Experian RPI Forecast for ) The property is held by way of a long leasehold interest on a new 150 year lease at a peppercorn rent from November 2015 (in solicitor s hands). Jul-26 Date 1% RPI rate 3.62% RPI rate (Average Experian RPI Forecast for ) Jul % 6.22% Jul % 6.44% Jul % 6.68% Jul % 6.92% Jul % 7.17% Jul % 7.43% Jul % 7.69% Jul % 7.97% Jul % 8.26% Jul % 8.56%

7 Covenant Information Odeon & UCI Cinemas Group is Europe s leading cinema operator and the largest in the world outside of America, with 2,227 cinema screens in 244 locations in the UK, Ireland, Italy, Germany, Austria and Spain. At group level, attendances were up 7.3% for H1 2015, increasing revenue by 17% and EBITDA by 50% to million. Odeon is the UK s largest cinema operator with over 110 cinemas, accounting for nearly a third of all tickets sold in the UK. Forecast results for end of 2015 suggest that turnover and EBITDA will be significantly better than 2014 and almost certainly higher than the 5 year high of UK Cinema Market Commentary The UK box office achieved over 83 million cinema admissions in the first half of 2015, a 10% growth on the same period in 2014 and higher than the 10 year peak in 2011 (173 million admissions by the year end). Following the summer success of Jurassic World and anticipated box office appeal of Spectre (James Bond) and Star Wars: The Force Awakens, 2015 could easily exceed this 10 year high. Looking ahead, cinema operators and studios are confident the 2016 film slate will maintain the UK s overall +2.06% CAGR (since 1990) in cinema attendance. The film slate, rather than wider macroeconomic conditions, is considered the main driver of attendance figures and the 2016 film slate is anticipated to deliver with feature films such as Batman v Superman: Dawn of Justice, Captain America: Civil War, and the second in the new Star Wars trilogy. Odeon Cinemas Ltd is the main UK trading company and has been rated 5A1 by D&B. Year (to December) Turnover ( 000s) EBITDA ( 000s) Net Assets ( 000s) ,518 16, , ,328 21, , ,444 24, ,635 Source: BFI, Cineworld.

8 Asset Management We have identified demand from a number of standalone A3 restaurants. There is an opportunity to accommodate a pod in the car park, as illustrated, subject to planning constraints and consent of 3rd parties. Odeon regard this as a positive asset management initiative.

9 VAT The property is elected for VAT purposes and it is anticipated that the sale will be treated as a transfer of a going concern (TOGC). EPC The subjects have an EPC rating of C. A full certificate is available upon request. Proposal Our client is seeking offers in excess of 10,100,000 (Ten Million One Hundred Thousand Pounds) reflecting a Net Initial Yield of 6.00% having allowed for purchaser s costs of 5.8% and assuming the vendor tops up the rent to 641,176 per annum to the next rent review on 1st July 2016 assuming 3.08% RPI growth (Experian forecast). Further Information For further information or to arrange an inspection please contact: Andrew McGregor Phone: Mobile: Andrew.McGregor@knightfrank.com Stephanie Gray Phone: Mobile: stephanie.gray@knightfrank.com KnightFrank.co.uk Full data room available on request. Notices Relating to Property Misrepresentation and Property Misrepresentation Act. Knight Frank for themselves and for the Vendors of this property whose Agents they are, give notice that:- The particulars are set out as a general outline only for the guidance of intending purchases and do not constitute part of an offer or contract; All descriptions, dimensions, references to condition and necessary permissions for use and occupation and their details are given in good faith and are believed to be correct, but any intending purchasers should not rely on them as statements or representations of fact, but must satisfy themselves by inspection or otherwise as to the correctness of them; Unless otherwise stated, all prices, rents and other charges are quoted exclusive of Value Added Tax (VAT). Any intending purchasers or tenants must satisfy themselves independently as to the incidence of VAT in respect of any transaction; All plant, machinery, equipment, services and fixtures & fittings referred to in these particulars were present at the date of publication. They have not, however, been tested and therefore, we give absolutely no warranty as to their condition or operation; No person in the employment of Knight Frank has any authority to make or give any representations or warranty whatsoever in relation to this property or these particulars, nor enter into any contract on behalf of the Vendors; No responsibility can be accepted for any expenses incurred by intending purchasers in inspecting properties which have been sold or withdrawn; The date of publication is November 2015.