Introduction to Annington 2019

INTRODUCTION TO ANNINGTON 2019 01 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 DISCLAIMER IMPORTANT INFORMATION This document has been prepared by The financial projections in this To the extent available, the industry and Annington Limited and its subsidiaries document are indicative estimates only market data contained in this document (“Annington”) to provide an and no reliance should be placed upon has come from third party sources. introduction to Annington. them. Annington’s ability to achieve Third party industry publications, This document does not constitute, these financial projections will depend studies and surveys generally state that and may not be construed as, an offer upon a number of factors outside of the data contained therein have been to sell or an invitation to purchase its control. These financial projections obtained from sources believed to be any investment or securities or the have been developed based upon reliable, but that there is no guarantee provision of investment or any other assumptions with respect to future of the accuracy or completeness of such advice by any party in any jurisdiction business decisions and conditions data. In addition, certain of the industry and no reliance may be placed for that are subject to change, including and market data contained in this any purposes whatsoever on the Annington’s execution of its strategies. document come from Annington’s own information contained in this document By their nature, financial projections internal research and estimates based (including any recommendations) or involve risks and uncertainties because on the knowledge and experience of its completeness. This document is they relate to events and depend Annington’s management team in the not intended to provide, and must on circumstances that may or may market in which Annington operates. not be taken as, the basis of any not occur in the future. As a result, While Annington believes that such decision and should not be considered Annington’s actual results are likely to research and estimates are reasonable as a recommendation to make any vary from the financial projections in and reliable, they, and their underlying investment or acquire any securities. this document and those variations may methodology and assumptions, have The recipient must make its own be material. not been verified by any independent independent assessment and such This document includes certain source for accuracy or completeness investigations as it deems necessary. statements, estimates, opinions and and are subject to change without Neither Annington nor any of its projections with respect to anticipated notice. Accordingly, undue reliance officers, employees, agents or future performance of Annington should not be placed on any of the affiliates makes any express or implied (“forward-looking statements”) which industry or market data contained in representation, warranty or undertaking reflect various assumptions concerning this document. with respect to the information, anticipated results which may or | Annington Limited Introduction to Annington 2019 opinions or projections contained may not prove to be correct. Such in this document, and none of them forward-looking statements reflect accept any responsibility or liability current expectations and various other as to its accuracy or completeness assumptions and involve significant or for any loss howsoever arising, risks and uncertainties and should directly or indirectly, from any use not be read as guarantees of future of such information, opinions or performance or results and are not projections or otherwise arising in accurate indications of whether or connection therewith. The delivery not such results will be achieved. Also of this document does not imply that general economic and markets factors, the information herein is correct or which are not predictable, can have complete as at any time subsequent to a material effect on the reliability of the date hereof and Annington has no forward-looking statements. Such obligation whatsoever to update any forward-looking statements only of the information or the conclusions speak as at the date this document or projections contained herein or to is provided to the recipient and correct any inaccuracies which may Annington is under no obligation to become apparent subsequent to the update or revise such forward-looking date hereof. statements to reflect new events or circumstances. It is up to the recipient of this presentation to make its own assessment of the validity of such forward-looking statements and no liability is accepted by Annington in respect of the achievement of such forward-looking statements and assumptions. 02

Whetstone, East Barnet 03 | Annington Limited Introduction to Annington 2019

Waterbeach, Cambridgeshire 04 | Annington Limited Introduction to Annington 2019

CONTENTS Summary 06 Portfolio overview 08 Married quarters estate 12 Financial performance 24 Opportunities for growth 28 Environmental, social and governance 34 Appendix 40 | Annington Limited Introduction to Annington 2019 05

Introduction to Annington 2019 SUMMARY ANNINGTON: A SUBSTANTIAL REAL ESTATE ASSET WITH STABLE, LONG-TERM, GOVERNMENT-BACKED CASH FLOWS & GROWTH POTENTIAL 1. Attractive and sizeable real estate asset 2. Stable, long-term, Government-backed cash flows • Largest private residential landlord in the UK • Irreplaceable asset for provision of housing for Armed • c.39,000 homes on 200-year lease to UK Government Forces families • Critical asset provider to the Ministry of Defence (‘MoD’) • Attractive homes in places with strong demand • Contractually prescribed rent reviews, which regularly • Plays to the UK’s structural housing supply–demand capture market movements imbalance • Substantial reversionary potential through the site review • Established PRS portfolio and platform process • Strong track record of generating value from properties released by the MoD • High income to EBITDA conversion of 90% 3. Robust financials1 4. Clear growth potential • Property Fair Value of £7.7bn (2018: £7.1bn) • Efficient and scalable operating platform with • Net rental income of £192.8m established processes and low operational risk • Significant free cash flow • Long term and low cost investment grade • Opportunities to expand further into PRS through: - Proprietary pipeline from MoD releases capital structure - Purchases in the open market • Gross LTV of 44%2 • Experienced management team with proven track record of performance | Annington Limited Introduction to Annington 20191. Source: Annington Report and Accounts 2019 2. Excluding utilities provision 06

Tidworth, Wiltshire 07 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 PORTFOLIO OVERVIEW DUE TO ITS SIZE, ANNINGTON IS WELL PLACED TO TAKE ADVANTAGE OF THE STRUCTURAL SUPPLY-DEMAND IMBALANCE IN THE UK HOUSING MARKET SCALE AND DIVERSITY Properties Married Quarters Estate Portfolio Private Rented Portfolio Activity • c.39,000 homes leased to the MoD • c. 1,800 homes owned and rented Lease length The core business: to the general public, the MoD and Lease type • Provision of Service Family housing associations3 Passing rent Value Accommodation (‘SFA’) • Residential investment portfolio • Refurbishment and sale or rent of • Properties rented on market terms properties released by the MoD both individually and in bulk (18,889 released to date) 1, 2 • 200-year lease - 177 years unexpired • Assured shorthold tenancies & flexible leases • Repairs and maintenance paid by tenant • Repairs and maintenance paid by tenant or landlord • £180m1 • £387 / unit / month 2 • £16m 1 • Vacant Possession Value of £9,128m 1,2 • £848 / unit / month 1 • Property Fair Value of £7,209m 1 • Property Fair Value of £410m 1 | Annington Limited Introduction to Annington 20191. As at 31 March 2019 (Annington Limited Report and Accounts) 2. MQE, Surplus Estate and Related Assets 3. Incudes 256 units under developement 08

09 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 LARGE, DIVERSE AND WELL LOCATED PORTFOLIO Geographical breakdown1,2 Region Units Value £m Value % South East 15,229 4,203 45.9 South West Greater London 9,787 1,939 21.2 East Anglia Yorks & 1,967 1,118 12.2 Humberside East Midlands 3,028 543 5.9 West Midlands Wales 3,092 453 4.9 North West North 2,496 399 4.4 1,627 255 2.8 0.5% 135 1.5 0.7% 850 0.7 509 64 0.5 4.9% 395 47 100 38,980 9,156 | Annington Limited Introduction to Annington 2019 2.8% 4.4% More than 85% 1.5% 5.9% of value located in the Greater South which is historically associated with strong demand and rising prices 12.2% 21.2% 45.9%% Source: Annington Limited Report and Accounts 2019 1. As at 31 March 2018 2. Includes MQE, Surplus Estate, Related Assets and £28m of New Build 10

GOOD QUALITY FAMILY HOMES 5.5% 41.4% 18,3% 24.1% 13.6% 8.1% 14.4% Designed Historically Focused on with families 30.2% low density houses in mind 48.1% 38.7% 57.6% Semi detached Terraced 2 3 4+ bedrooms Pre 1945 1945 - 64 Detached Flats / Apartments 1965 - 79 Post 1979 Source: Annington Limited Report and Accounts 2019 PORTFOLIO IMPRESSIONS Low density developments. Larger than new build properties. Good transport links and amenities. 61 26 HOUSES HOUSES High Wycombe, Buckinghamshire Coltishall, Norwich, Norfolk | Annington Limited Introduction to Annington 2019 24 306 APARTMENTS HOUSES Jupiter Heights, Uxbridge, London Rowner, Hampshire 11

Introduction to Annington 2019 MARRIED QUARTERS ESTATE UNIQUE HOUSING PORTFOLIO WITH ATTRACTIVE GOVERNMENT-BACKED LEASES Essential asset 200-year contract Advantageous lease terms for the MoD with UK Government • Triple net lease, in which • Provides the majority of • Strong, stable rental income from Annington has: accommodation for service families long-term leases signed with the across England & Wales UK Government in 1996 - 177 - No vacant property risk; MoD years unexpired pays rent on units irrespective • Difficult to replicate due to cost and of occupancy proximity to core military bases • 38,726 units1 on 510 sites - No responsibility for management • MoD currently benefits from and maintenance a significant 58% discount to market rent - No refurbishment risk; MoD must return assets in good | Annington Limited Introduction to Annington 2019 repair or pay compensation for dilapidations • Contractual Rent and Site review processes capture market upside and reduce downside risk • Significant reversionary potential when properties are released 1. MQE Retained Estate units as at March 2019 12

Rowner, Hampshire 13 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 STABLE, PREDICTABLE AND INCREASING RENT • Annual rent from the MQE has grown by 63% even though the number of units rented has decreased by 29% • Average rent per unit CAGR in the retained estate of 3.9% vs. UK CPI of 2.0% Rent per unit 3.9% like for like CAGR £ / year / unit 5,000 4,500 4,000 3,500 3,000 2,500 2,000 | Annington Limited Introduction to Annington 2019 1,500 1,000 500 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 14 Source: Annington as at 30 December 2018

No. of Units 000s 56 54 52 50 48 46 44 42 40 38 36 34 32 30 28 26 24 22 20 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Total Rent | Annington Limited Introduction to Annington 2019 £m 180 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 20 10 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 15

Introduction to Annington 2019 RENT REVIEW MECHANISM CAPTURES MARKET MOVEMENTS • 5 year rolling Rent Review process ensures that rent tracks open market movements • The MoD currently benefits from a 58% discount to open market rent reflecting: - The bulk nature of the portfolio - The MoD covenant - Responsibility for management and maintenance costs • Site Review mechanism expected to reduce the MoD’s discount from 2021 Timing Five-yearly rent review Mechanics • Continuous 1996–2196 Track record • Five year cycle, c. 25% of sites reviewed in each of four years followed by one year off • 510 individual sites • Each site has a representative property to benchmark the Rent Review (the “Beacon Unit”) • Open market rent increase assessed for each Beacon Unit and applied across the site • 58% discount applied to updated open market rent • Well established and routine process • 16 annual rent reviews successfully completed over four full cycles • Successfully tracks market rent movements • 3.9% average rent CAGR | Annington Limited Introduction to Annington 2019 16

SITE REVIEW PROCESS CRYSTALIZES REVERSIONARY POTENTIAL • Site Review designed to review rents to open market on a site by site basis • On 7 March 2019, Annington and the MoD agreed an expedited and binding process in place of the form of Site Review prescribed by the leases. This process will produce an equivalent outcome to the Site Review but: - In a shorter period of time, and - At a significantly reduced cost • New rent charged to the MOD will apply from 2021 onwards as prescribed in the leases • Early determination process will lead to a confirmed outcome by March 2021 • Process will give Annington and the MoD certainty on rent payable • The parties have agreed to additional key commercial terms to strengthen their relationship, most importantly a mechanism to reduce vacant properties held by the MoD through the provision of relief by Annington on costs associated with returning the units to Annington: - MoD committed to release 500 units p.a. for 7 years - In return, Annington provides £7,000 per unit dilapidations relief Gamlingay, South Cambridgeshire | Annington Limited Introduction to Annington 2019 17

Introduction to Annington 2019 PROVEN OPERATING MODEL Annual rent reviews Site reviews Termination / Release | Annington Limited Introduction to Annington 2019 RENTAL INCOME 18

• Stable core contract with reversionary uplift • Strong track record of generating value from releases SALES INCOME Re-develop Strategic decision Re-furbish Rent on open market Sell | Annington Limited Introduction to Annington 2019 19

Introduction to Annington 2019 MAXIMISING VALUE FROM RELEASES • Immediate capital and/or rent reversion to market levels on release of properties • Annington maximises value by adopting a mixed sale and rental strategy • Strong operational track record of dealing with geographically diverse releases • Helped over 17,000 people purchase their own home; many first time buyers, service personnel and key workers UNITS RELEASED PER CALENDAR YEAR Phase 1: MoD Rationalisation Between 1996 and 2011 the MoD had a profit sharing agreement with Annington, incentivising releases 2,623 2,698 2,374 2,185 1,367 1,530 1,186 | Annington Limited Introduction to Annington 2019 614 590 419 441 362 280 450 8 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 3 1,015 1,067 1,745 1,388 2,775 1,825 1,885 955 1,438 547 745 115 497 347 Numb 20

Jupiter Heights, Uxbridge, London Phase 2: Releases Phase 3: Vacancy reduction As part of the Arbitration Agreement the MoD has agreed to release a minimum of 3,500 units over the next seven years and in return Annington will waive up to £7,000 of dilapidations per released unit 500 500 500 500 500 500 | Annington Limited Introduction to Annington 2019 324 22 264 342 149 218 2 243 257 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 353 311 229 387 392 261 2 66 - - - - - - - ber sold 21

Introduction to Annington 2019 SUCCESSFUL STRATEGIES FOR RELEASES LARGE SITE SALES MIXED SALE & RENTAL RAF Coltishall, Norfolk Waterbeach, Cambridgeshire Key features Key features • 424 houses and flats • 254 houses and flats • Sale strategy with rental used to manage market demand • Mixed sale (155 units) and rental (99) strategy • Refurbishment included internal redecoration of units • Refurbishment included internal redecoration of units and street scene and street scene • Unit sales outperformed value expectations • Unit sales outperformed value expectations REDEVELOPMENT BULK RENT RAF Brize Norton, Oxfordshire Canterbury, Kent | Annington Limited Introduction to Annington 2019Key features Key features • 135 new build units (54 flats and 81 houses) • 147 units • Existing MQE units rented during planning process • Bulk let following refurbishment and street scene work • Total demolition and rebuild • 30 year lease on terms similar to MoD rent at 83% of OMR • Mixed sale and rental strategy • Rented to London Borough of Redbridge to alleviate homelessness 22

Waterbeach, Cambridgeshire CONSTRUCTIVE DIALOGUE WITH MOD Dialogue ongoing • Regular program of meetings • Contacts at multiple levels in both organisations Commercial arrangement with significant points of alignment • Agreement on early Site Review process provides certainty to both parties • Long term incentives in place for MoD to release units in return for dilapidations relief • Joint working group formed to address estate and infrastructure issues • Co-operation on redevelopment opportunities – marriage value | Annington Limited Introduction to Annington 2019 23

Introduction to Annington 2019 FINANCIAL PERFORMANCE HIGHLIGHTS 2019 Financial year Key development 2019 • The carrying value of Group Annington Homes (Guernsey) Limited conversion to an Open investment properties is £7.7 billion, Ended Investment Company up from £7.1 billion. • On 5 April 2019, the sole shareholder of Annington Limited • At 31 March 2019, the Group’s (“Annington”), Annington Holdings (Guernsey) Limited (“AH(G)L”), was investment properties comprised converted into an Open Ended Investment Company. This conversion 40,383 completed units (2018: will have a number of positive benefits for the Annington Group, 40,348 units). including the following: • Rental income was £196.8 million i. It facilitates the raising of new equity by AH(G)L. (2018: £193.1 million). ii. It will allow existing investors to redeem their shares at a price • Profit after taxation was £457.1 calculated with reference to NAV, provided in every case that million driven largely by the this does not prejudice the fundamental credit standing of revaluation in 2019. In 2018 the Annington. loss after tax was £1,059.8 million largely due to the one off costs of refinancing in 2018. • The Group sold 66 (2018: 121) properties and recognised £15.1 million (2018: £34.9 million) in sales income. | Annington Limited Introduction to Annington 2019 Redruth, Cornwall 24

LONG-TERM, LOW AND FIXED COST CAPITAL STRUCTURE JULY 2017: SUCCESSFUL GROUP REFINANCING Debt profile (£ million) 700 526 625 600 625 625 600 500 2024 2025 2029 2034 2047 400 Term Loan 300 200 400 100 0 2022 GBP bond1 EUR bond Debt profile (£ million) Key terms 8% • 100% unencumbered assets 11% • BBB rating from Fitch and S&P with stable outlook • £3,401 million of unsecured debt outstanding £3.4bn total • c.13 years average remaining maturity | Annington Limited Introduction to Annington 2019 • 3.3% average cost of debt 14% available • Undrawn £300m RCF • Dividend distribution possible (subject to meeting debt 67% covenant ratios) • Gross LTV of 44%2 GBP bond1 EUR bond Term Loan RCF (undrawn) The Board of Annington Limited is committed to retaining Annington’s Investment Grade bond rating 1. Euro bonds are swapped to GBP 2. Calculated in accordance with bond and debt covenants 25

Introduction to Annington 2019 INCOME STATEMENT £k, FY end in March 2015 2016 2017 2018 2019 Actual Actual Actual Actual Actual Annington Limited Income Statement 183,001 196,793 (17,381) (4,009) Gross rental income 179,269 188,164 193,067 (Operating expenses) (16,172) 165,620 (7,074) (4,160) 192,784 (12,145) (13,810) Net rental income 163,097 181,090 188,907 (Administrative expenses) (12,732) (58) (14,545) (17,157) (5,636) (Site review costs) 61 3,532 (Other expenses) (689) (368) (1,505) 210 153,478 79 51 176,870 (86) (58) Normalised EBITDA 149,886 166,256 170,296 Depreciation (112) 7,196 (81) (31) 1,120 Results in JVs 8,730 (269,203) (110,948) (Net interest expenses) 4,816 14,748 (274,846) (108,615) (261,938) (1,001,997) 66,984 35,634 726 Direct result before tax (116,342) 1,085 (90,947) (816,984) (431) Result on disposals 23,306 714,515 13,727 6,434 481,246 Provisions release (878) - 2,449 4,069 3,306 Unrealised revaluation result (481,858) Other 765,671 751,234 911,544 (3,306) 484,847 - - 642,619 (474,661) 551,831 Indirect result before tax 788,099 (33,620) 927,720 (94,724) (1,291,645) Total result before tax 671,757 608,999 836,773 231,843 457,107 (Tax) (130,919) (76,078) 2.7% (1,059,802) 2.6% Total result 540,838 2.5% 760,695 2.5% 90.5% 98.0% | Annington Limited Introduction to Annington 2019 Key ratios 3.0% 83.9% 2.5% 2.7% 89.9% 2.7% 2.4% 2.7% Gross yield 91.0% 96.2% 97.8% Net yield 83.6% 88.4% 88.2% Gross/net margin EBITDA margin2 1. Including £834,663k bond redemption costs 2. EBITDA excluding refurbishment costs and recovered dilapidations 26

BALANCE SHEET £k, FY end in March 2015 2016 2017 2018 2019 Annington Limited Balance Sheet 6,699,590 7,563,065 7,102,224 7,656,911 Investment property 6,074,852 10,686 7,428 2,711 2,225 (standing assets) - 33,403 25,284 14,198 6,039 Investment property 41,510 23,592 6,556 12,784 (held for sale) 29,155 115,993 131,421 162,783 907 6,901,182 7,750,790 156,607 7,840,742 Investment in joint assets 3,038,364 3,799,059 7,282,296 3,677,892 116,631 2,960,963 3,011,970 3,220,157 3,371,313 Other assets 63,653 26,074 3,377,499 730,478 806,556 4,647 Cash and cash equivalents 39,227 39,519 (3,559) 663,306 68,497 67,612 574,561 Total assets 6,247,070 6,901,182 7,750,790 40,009 39,663 83,575 Shareholders' equity 2,429,365 45.1% 40.1% 73,975 7,840,742 Interest-bearing debt 2,922,434 3,038,364 3,799,059 7,282,296 Derivatives 44.1% Deferred tax liabilities (net) 94,523 47.5% 3,677,892 Provisions 696,849 3,220,157 Other liabilities 37,808 66,091 Total equity and liabilities 6,247,070 Key ratios (nominal) 49.7% 2,429,365 Gross LTV1 NAV 1. Excluding utilities provision | Annington Limited Introduction to Annington 2019 27

Introduction to Annington 2019 OPPORTUNITIES FOR GROWTH GROWTH OPPORTUNITIES FOR ANNINGTON 2 significant opportunities: • Adding to Annington’s existing PRS portfolio through organic growth and external acquisitions • Exploiting and maximising the unique attributes of the management platform PRS - Clear competitive advantage Significant opportunity to add to existing rent-stabilised PRS portfolio Proprietary pipeline Exposure to a unique proprietary pipeline of c.40,000 homes valued at £9.1bn1 Day 1 rent stabilised Existing rented portfolio of c.1,800 homes with a Property Fair Value of £410m, income stream 48% let on long term leases and 52% on ASTs Experienced management Established management team with significant industry experience and knowledge Long track record Twenty year track record of refurbishment and new build skills, property and utilities management, dilapidations and legal/conveyancing services. Scaleable platform Established and scaleable operating platform Strategy Clear and differentiated Source: Company Data as at 31 March 2019 1. Vacant Possession Value | Annington Limited Introduction to Annington 2019 PinnPoint, Uxbridge 28

PRS - RIGHT STOCK, RIGHT PLACE, RIGHT PRICE • Differentiated PRS strategy focused on family homes • Annington has the option to retain released MQE units for rental or make opportunistic acquisitions on the open market • Demand for professionally managed Private Rented Sector property is increasing even if current political uncertainty encourages caution MQE pipeline ANNINGTON PRS Standing stock OPPORTUNITY Proprietary pipeline: c.39,000 Fully let portfolio of residential units rented to MoD, of which Open market properties: c. 1,800 units c.7,300 are empty • Site acquisition and direct Leased to Site releases development • Individual tenants Sites from the 500 units p.a. • Forward funding limits • Bulk tenants including released by the MoD, which development risk meet the investment criteria and Local Authorities complement Annington’s existing • Acquisition of individual PRS portfolio tenanted properties and assets • Portfolios and corporate acquisitions | Annington Limited Introduction to Annington 2019 29

Introduction to Annington 2019 PRS STRATEGY IN ACTION DEVELOPMENT FORWARD FUNDING PORTFOLIO ACQUISITION PinnPoint, Uxbridge Oak Portfolio Key elements Key elements # units 207 # units 104 £ investment £78m £ investment £24m Completion 2019 Completion May 2018 Status Status • New build, forward funding opportunity • Portfolio acquisition of standing stock in Gloucester, • All 207 units in 3 blocks handed over Bristol and Hedge End • Rapid take-up in lettings • Fully let / reserved (103 let and 1 reserved) • Product very well received by tenants • 4.9% rental uplift between annualised appraisal ERV and current rents. | Annington Limited Introduction to Annington 2019Jupiter Heights, Uxbridge 30

MQE HANDBACKS MQE HANDBACKS Bordon Canterbury Key elements Key elements # units 200 # units 34 £ investment - £ investment - Completion Phased 2019/20 Completion Phased 2019/20 Status Status • 200 family homes at Bordon • 34 family homes at Canterbury • All units to be reinstated • All units to be reinstated • Mixed sale and rental strategy envisaged • Units will be handed over to London Borough of Redbridge under their existing bulk lease | Annington Limited Introduction to Annington 2019 31

Introduction to Annington 2019 SCALABLE MANAGEMENT PLATFORM Annington has a 20 year Fully vertically integrated track record of building and capability; managing large portfolios; • Market insight • Efficiently • Industry credibility and relationships • Scalably • Financing expertise • Flexibly • Acquisition capability; appraisal • Cost effectively and investment • Refurbishment and development expertise • Sales and leasing capability • Property management know-how • Customer service | Annington Limited Introduction to Annington 2019 32

Henlow, Bedfordshire 33 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 ENVIRONMENTAL, SOCIAL AND GOVERNANCE EXPERIENCED MANAGEMENT TEAM WITH LONG TRACK RECORD THE ANNINGTON BOARD NON-EXECUTIVE Baroness Helen Liddell Jos Short DIRECTORS Chair Deputy Chair Vivek Ahuja Justin King Terra Firma Director Director EXECUTIVE James Hopkins Andrew Chadd DIRECTORS Chief Executive Officer Chief Financial Officer | Annington Limited Introduction to Annington 2019 SENIOR Adrian Needham Sally Parsons MANAGEMENT Rentals Director Property Director TEAM 34

Nicholas Vaughan Commercial Director Ciaran Bennett IT Director Holly Miller Chief of Staff 35 | Annington Limited Introduction to Annington 2019

Introduction to Annington 2019 CLEAR CORPORATE VALUES DEMONSTRATED IN THE BUSINESS Focused Approachable 93%| Annington Limited Introduction to Annington 201990% of staff said of staff said Annington Annington is 'Focused' is 'Approachable' 36

Our company values, Focused Approachable The F.A.C.E. of Annington, underpin our commitment We are focused on acting We are approachable and open to acting responsibly and set responsibly and making a positive in how we work. guidelines for our behaviours difference through our work in to make good commercial local communities. and ethical decisions. Caring Experienced We are caring as we value our people, We are experienced as we employ our customers, our partners and our the best people and work with the shareholders and treat them fairly. right partners to do the best job. Caring Experienced 90% 95% | Annington Limited Introduction to Annington 2019 of staff said of staff said Annington Annington is 'Caring' is 'Experienced' 37

Introduction to Annington 2019 FOCUS ON GOOD CORPORATE CITIZENSHIP THROUGHOUT THE WORKPLACE CARING FOR OUR PEOPLE RESPECTING OUR ENVIRONMENT By caring for our people and fostering their personal and By encouraging our employees to consider the environmental professional development, they bring a wealth of skills and impact of our offices and working with our partners on the experience to meet the needs of our customers, partners sites we refurbish, we minimise the environmental impact of amd shareholders and deliver our business goals. our business. VALUING OUR CUSTOMERS INVESTING IN OUR COMMUNITIES AND PARTNERS | Annington Limited Introduction to Annington 2019 By working with partners and suppliers who aspire to our By adding valuable housing stock back into local business standards and values and by treating them fairly, we communities and supporting local charity and community together meet our customers' needs by providing refurbished organisations, we help contribute to thriving and sustainable homes for sale or rent at competitive prices in environments communities. in which people want to live. 38

CORPORATE CITIZENSHIP THROUGH OUR CHARITY WORK Annington’s charitable work is the most visible expression of the Company’s commitment to communities. Giving is focussed on supporting the young and elderly, and the military. Annington supports: In 2018, Annington also entered into a four-year funding agreement with the Commonwealth War Graves Commission to undertake a major new UK wide community based volunteer programme called ‘Eyes On, Hands On’. Aldershot, Hampshire | Annington Limited Introduction to Annington 2019 39

Introduction to Annington 2019 APPENDIX GLOSSARY AH(G)L Greater South SAVPV Annington Holdings (Guernsey) Comprises the regions South East, Special Assumption Vacant Possession Limited. South West, East Anglia and Greater Value. This is used by Annington London. to estimate the MQE based on the AL hypothetical assumption that each HPI property is vacant (i.e. without existing Annington Limited. MoD lease arrangement), sold on House Price Index, as defined by a an individual basis with no costs on AST regionally blended average of the disposal and introduced to the market Nationwide and Halifax indices. in a phased and orderly manner. Assured Shorthold Tenancy. Annington and Allsop’s estimate SAVPV Indexed Bid SAVPV using Indexed Bid SAVPV (see below.) Bid SAVPV Bid SAVPV indexed by regional HPI. SFA SAVPV of MQE determined by Colleys (independent real estate advisor to MoD Service Family Accommodation. Annington) in 1996. Ministry of Defence. SFH BtR MQE Single Family Homes. Build-to-rent. The Married Quarters Estate. Site Review Fair Value OMV Assessment of open market rent on The price at which an orderly a site-by-site basis under specified transaction to sell an asset or to transfer Open Market Value. valuation assumptions every 15 years a liability would take place between starting with the initial Site Review in market participants under current Passing Rent 2021 – 2024. market conditions. With respect to MQE, fair value is determined by Annualised rental income based on Surplus Estate Allsop under the Red Book, taking the cash rents payable at the reference into account the existence of the date. Units released from the Retained Estate underlying lease arrangements with the but not yet disposed of by the Group. MoD (including the applicable agreed PRS discount to market rent). With respect Triple Net Lease to the non-MQE portfolio fair value is Private Rented Sector. based on a yearly valuation conducted Lease net of management, by Allsop on a c. 20% sample, with any Red Book maintenance and repair obligations valuation movements in the sampled and other associated costs, including properties applied by management to RICS Valuation – Professional insurance, tax and utilities. the entirety of the portfolio. Standards, January 2014 (published in November 2013). Unit Rent Review Individual dwellings including flats and houses. Also “Beacon Unit Review”. 5 yearly | Annington Limited Introduction to Annington 2019 process of rent adjustments based on representative units on each site. Retained Estate Units leased by the MoD under the original MQE that have not yet been released. 40

High Wycombe, Buckinghamshire 41 | Annington Limited Introduction to Annington 2019

1 James Street, London| Annington Limited Introduction to Annington 2019 United Kingdom W1U 1DR Telephone: 020 7960 7500 www.annington.co.uk Registered in England and Wales No. 08271384 42