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VALUATION REPORT

Chester House (Formerly) 1 Transvaal Avenue Double Bay NSW 2028 Commonwealth Bank of Australia (CBA)Commonwealth Bank of Australia (CBA)Commonwealth Bank of Australia (CBA)Commonwealth Bank of Australia (CBA)

Date of Valuation: Date of Valuation: Date of Valuation: Date of Valuation: 29 August 201229 August 201229 August 201229 August 2012

External Elevation from Transvaal Avenue

CONTENTS

1. Valuation Synopsis .................................................................... 5 Instructions ...................................................................................................... 5 Property Overview ............................................................................................ 5 Critical Assumptions ......................................................................................... 6 Assessment ...................................................................................................... 6 SWOT Analysis ................................................................................................ 7 Risk Assessment ............................................................................................... 8 Executive Summary ........................................................................................ 10

2. Introduction ............................................................................ 11 Instructions .................................................................................................... 11 Reliance and Liability ..................................................................................... 11 Market Movement .......................................................................................... 11 Valuer’s Interest ............................................................................................. 12 Market Value Definitions ................................................................................ 12 Industry Practice ............................................................................................. 12 Further Purpose & Scope of Report ................................................................. 12

3. Site Details .............................................................................. 13 Location ........................................................................................................ 13 Site & Services ................................................................................................ 14 Site Contamination Risk ................................................................................. 15 Asbestos Risk ................................................................................................. 15 Real Property Description (Freehold) ............................................................... 16 Title & Interests .............................................................................................. 16 Town Planning ............................................................................................... 17 Statutory Assessment ...................................................................................... 18

4. Improvements ......................................................................... 19 Property Description ....................................................................................... 19 Lettable Area ................................................................................................. 19 Accommodation ............................................................................................ 19 Condition & Repair ........................................................................................ 23 Capital Expenditure ....................................................................................... 23

5. Occupancy Details ................................................................... 24 Tenancy Summary ......................................................................................... 24 Lease Expiry Analysis ...................................................................................... 27 Tenancy Issues ............................................................................................... 27 Tenancy Schedule .......................................................................................... 28 Outgoings ..................................................................................................... 30 Net Income Summary .................................................................................... 30

6. Market Commentary ............................................................... 31 Local Market Commentary ............................................................................. 31

7. Financial Analysis.................................................................... 32 Rental Analysis ............................................................................................... 32 Rental Assessment .......................................................................................... 34 Net Income Estimate ...................................................................................... 35

8. Sales Evidence ........................................................................ 36 Sales Evidence ............................................................................................... 36 Concluded Investment Parameters ................................................................. 37

9. Valuation Rationale ................................................................ 38 Introduction ................................................................................................... 38 Capitalisation Analysis ................................................................................... 38 Direct Comparison Approach ......................................................................... 39 Valuation Summary ....................................................................................... 40 Treatment of GST .......................................................................................... 40

10. Additional Reporting Requirements ......................................... 41

11. Qualifications ......................................................................... 42

12. Contact Details ....................................................................... 43

APPENDICES

A. Copy of Letter of Engagement ................................................. 45

B. Valuation Terminology & Definitions ....................................... 47

C. Title Search ............................................................................. 49

D. Deposited Plan ....................................................................... 51

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

1 VALUATION SYNOPSIS

Instructions

Instructed By: � Mr Kerry McCloy of Transvaal Investments Pty. Ltd, dated 14 August 2012.

Property: � Chester House (Formerly) 1 Transvaal Avenue Double Bay NSW 2028

Reliance::

i.e. Reliant Party/Purpose & Basis of Valuation

� Commonwealth Bank of Australia (CBA) for First Mortgage Security only.

− Market Value - "As Is" - Subject to existing occupancy arrangements.

Interest Valued: � Freehold.

CBRE Reference: � 12 226 154.

Property Overview

Registered Owner � Transvaal Investments Pty. Ltd.

Land Area: � 421.9 sqm.

Town Planning: � Zoned 3(a) Business General (Woollahra Local Environmental Plan (LEP) 1995).

Brief Description: � The subject as currently configured is improved with a modernised circa 1970's three storey commercial building incorporating 14 office and 2 retail tenancy areas. The property is positioned in an upmarket boutique eastern suburbs retail precinct.

Tenancy Profile: � As currently leased and configured: 16 tenancies, with 10 occupied under formal lease agreements, 2 currently vacant, and 4 occupied under a monthly agreement.

Lettable Area: � 722 sqm (Source: Lettable areas have been derived from the tenancy schedule supplied by the Registered Proprietor.)

Buyer Demand/ Purchaser Profile:

� In the current market:

− Anticipated buyer demand/liquidity: moderate.

− Likely purchaser profile comprises: private investors.

− Estimated selling period (with a professional marketing campaign) is: 6 months.

Recent Sale History:

� According to RP Data records, there has been no sale within the last 3 years.

� We have requested but are not aware of any current contract of sale.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2Double Bay NSW 2Double Bay NSW 2Double Bay NSW 2028028028028

Critical Assumptions

Our valuation specifically assumes:

Level 2, Suite 12: � We have assumed that partitions will be installed on Level 2 as at the date of valuation to create 49.0 square metres of office accommodation known as Suite 12.

Suites 1 and 4, Level 2:

� We were not afforded the opportunity to inspect Suites 1 and 4 on Level 2; we have assumed a similar condition and configuration of accommodation to the remaining Suites sighted on Level 2 for the purpose of our valuation.

Tenancy Schedule: � We were provided a current tenancy schedule as at 24 August 2012. Representatives of the Registered Proprietor have indicated that the tenancy schedule, including income and outgoings remain unchanged as at the date of valuation and we have adopted same within our valuation calculations and considerations.

Lettable Areas: � Lettable areas have been calculated by reference to the tenancy schedule provided by Representatives of the Registered Proprietor, and are approximate only.

Assessment

Approaches: Capitalisation, Direct Comparison

Date of

Inspection:

29 August 2012

Date of Valuation: 29 August 2012

Valuation: Market Value - "As Is" - Subject to existing occupancy arrangementsMarket Value - "As Is" - Subject to existing occupancy arrangementsMarket Value - "As Is" - Subject to existing occupancy arrangementsMarket Value - "As Is" - Subject to existing occupancy arrangements

(100% Interest) $6,925,000$6,925,000$6,925,000$6,925,000

(Six Million, Nine Hundred and Twenty Five Thousand Dollars)(Six Million, Nine Hundred and Twenty Five Thousand Dollars)(Six Million, Nine Hundred and Twenty Five Thousand Dollars)(Six Million, Nine Hundred and Twenty Five Thousand Dollars)

This valuation is exclusive of GST.

Summary of

Conditional

Terms:

CBRE Valuations Pty Limited

Principal ValuerPrincipal ValuerPrincipal ValuerPrincipal Valuer Co-Signing Director*Co-Signing Director*Co-Signing Director*Co-Signing Director*

Tony Mangioni Adam Fulton AAPI Registered Valuer No 2723 Director - Valuation & Advisory Services

Certified Practising Valuer

Associate Director - Valuation & Advisory Services

Property Inspection: Yes No

Job Involvement: Principal Valuer Co-Signatory in capacity of Director*

* The Co-Signing Director (reviewer of report) verifies that the report is genuine and endorsed by CBRE

however the opinion of value expressed has been arrived at by the Principal Valuer alone.

The valuation stated is subject to all content, issues, assumptions, disclaimers, qualifications

and recommendations throughout the report (including but not limited to the Qualifications

section). The report is prepared for the use of and reliance by the Reliant Party only and

limited only to the Purpose specifically stated. No responsibility is accepted or assumed to

any third party for the whole or any part of the report.

Prepared By:

SWOT Analysis

MARKET INSTABILITYMARKET INSTABILITYMARKET INSTABILITYMARKET INSTABILITY

�

STRENGTHS & OPPORTUNITIESSTRENGTHS & OPPORTUNITIESSTRENGTHS & OPPORTUNITIESSTRENGTHS & OPPORTUNITIES

Positive attributes the envisaged purchaser type would consider:

�

WEAKNESSES & THREATSWEAKNESSES & THREATSWEAKNESSES & THREATSWEAKNESSES & THREATS

Negative attributes the envisaged purchaser type would consider:

�

Weighted Average Lease Expiry (WALE) of 1.77 years by income is considered average, albeit not unusual for a

commercial property of this size and number of tenancies in the immediate locale.

The ground floor retail configuration is considered inefficient; a relatively large ground floor office component is

positioned towards the rear of the subject at the expense of retail accommodation.

Level 2 has an unusually large common area; considered an inefficient office configuration.

Capital expenditure requirement of approximately $12,500 required to install the partition walls for Suite 12 on Level

There is no parking amenity onsite, however, this is not unusual for a property of this size and type in the eastern

suburbs.

The price point where the subject sits is at the upper ranges for an asset of this size and type within Double Bay.

Despite any other comment/forecast in this advice, should a major local or global financial event or natural disaster

occur, we recommend CBRE be instructed to review the potential impact on the assessed value.

Positioned within an upmarket, boutique retail precinct in Sydney's eastern suburbs; popular with local residents.

Nearby New South Head Road is serviced by regular bus services providing access to and from the Sydney CBD as well

as the remainder of the eastern suburbs.

Flexible "3(a) General Business" zoning allowing a variety of general commercial and retail uses subject to Council

approval.

Good retail offering within the immediate vicinity.

Modernised building providing functional retail and office accommodation.

Balconies and courtyard areas provided to certain tenancy areas on each level.

Each tenancy area meets market demand in terms of size.

Considered a trophy asset for high net worth individuals living in the eastern suburbs.

Good tenant demand for retail accommodation and average demand for commercial office space.

A Council-operated car park is positioned behind the property with direct access provided from the subject.

The standard of office accommodation is considered above typical commercial space within the immediate locale.

Large common areas afforded to occupants on Level 2.

The ground floor retail component is set back from the street and partially obscured by building columns.

Access to the upper levels is only by way of a single internal staircase.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2Double Bay NSW 2Double Bay NSW 2Double Bay NSW 2028028028028

Risk Assessment

ASSET ASSET ASSET ASSET

OfficeOfficeOfficeOffice

�

CONTAMINATION / HAZARDOUS MATERIALSCONTAMINATION / HAZARDOUS MATERIALSCONTAMINATION / HAZARDOUS MATERIALSCONTAMINATION / HAZARDOUS MATERIALS

�

- Formal advice provided? (e.g. Asbestos Containing Materials Register)

�

- Formal advice provided?

- Remediation costs quantified by a suitably qualified professional?

Precinct/Location is: Eastern Suburbs.

Asset's street appeal is: Consistent with surrounds.

Mechanical services are: As old as base building.

Readily identifiable capital expenditure? Approximately $12,500 required to

install the partition walls for Suite 12 on

Level 2.

Is car parking provision for occupiers/visitors adequate for current market

demand?

No parking is provided onsite, however,

this is typical for buildings of this size and

type in the eastern suburbs.

Work environment detractions include: Limited access to natural light to the rear

tenancies.

Floor plate size and dimension: Meet market demand.

Floor efficiency is: The ground floor is inefficient with a

large office area to the rear of the level,

Level 1 is efficient while Level 2 is

considered inefficient with a large

common area.

Accommodation provided is: Modernised.

Internal presentation is: Modernised.

Work environment is enhanced by: District views and good levels of natural

light provided to the upper levels, good

retail amenity within the immediate

vicinity.

Is current use the Highest and Best? Yes.

Did onsite contact draw attention to, or were any potential contamination

concerns identified on inspection?

No.

(Refer to body of report.)

Are principal improvements of an age where Asbestos Containing Materials

may be present?

Possible.

No.

Is there surplus land which may provide future expansion opportunities?

CASH FLOW PROFILECASH FLOW PROFILECASH FLOW PROFILECASH FLOW PROFILE

Multi TenantMulti TenantMulti TenantMulti Tenant

�

� 0.1 years to 5.0 years

� 1.77 years to 1.50 years

�

� $0

� No

� 12.7% 92.0 sqm

�

- Implied future lease term (consistent with recent leasing evidence): 5 years

- Rental downtime / Estimated vacancy period (rent and outgoings): 4 months

- Incentive / Rent free / Cash equivalent: 12%

- Agent fees (% of first year's gross rent): 3 months

� $394,355

� $89,742

� $87,450

� $437,866

�

� -$33,172

�

TENANTTENANTTENANTTENANT

�

ASSET MANAGEMENTASSET MANAGEMENTASSET MANAGEMENTASSET MANAGEMENT

�

INVESTMENT PARAMETER SUMMARYINVESTMENT PARAMETER SUMMARYINVESTMENT PARAMETER SUMMARYINVESTMENT PARAMETER SUMMARY

� 6.25%

� 5.69%

�

Observations/enquiries suggest tenant demand for subject office

accommodation within the locality is:

Average.

Elle Promotions, 51.0 sqm, expiry date

03/11/12.

Metro Commercial Partners, 110.0

sqm, expiring date 31/01/14.

Total outstanding incentives as at the date of valuation (allowed for):

Are any of the tenants in plus 60 Day arrears?

Property is leased to 16 tenants, with the major tenants being: Aymonod, Lindamood-Bell Learning

Processes and Metro Commercial

Partners.

Lease terms range from:

Combined Weighted Average Lease Expiry (WALE) is (by income/by area):

Major expiries to potentially impact cash flow in the next 3 years include: NLA Legal, 95.0 sqm, expiring date

20/07/14.

The current passing rental is considered to be above acceptable market

parameters, and a reduced rental has been adopted.

Value attributable to profit rent which will diminish as the lease expires:

Adverse atypical obligations which fall upon the landlord are: None noted within the leases.

Observations/enquiries suggest tenant demand for subject retail

accommodation within the locality is:

Good.

Current vacancy by area is:

Our calculations include the following estimates for letting allowances:

Net passing rental is:

Estimated market outgoings are:

Estimated market rent for vacant accommodation is:

Estimated fully leased net market rent is:

Adopted core capitalisation rate is:

Initial yield is:

Initial yield reflects: The asset is partly vacant.

Despite current occupancy, if vacant anticipated total lease-up period and

incentive required would be:

4 months let up, 3 month incentive.

Property is managed by: The owner.

Management practices are considered to be: Satisfactory.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW Double Bay NSW Double Bay NSW Double Bay NSW 2028202820282028

Executive Summary

CBRE EXECUTIVE SUMMARY - Tenanted VALUATION SUMMARYVALUATION SUMMARYVALUATION SUMMARYVALUATION SUMMARY

Valuation Approaches Capitalisation, Direct Comparison

Interest Valued Freehold

Lettable Area 722.0 sqm

Site Area 422 sqm

Date of ValuationDate of ValuationDate of ValuationDate of Valuation

Market ValueMarket ValueMarket ValueMarket Value

Insurance ReplacementInsurance ReplacementInsurance ReplacementInsurance Replacement $2,400,000$2,400,000$2,400,000$2,400,000

Capitalisation SummaryCapitalisation SummaryCapitalisation SummaryCapitalisation Summary Contract/Passing Market

Gross Income $484,097 $450,925

Outgoings (adopted) ($89,742) ($89,742)

Net Income (before vacancies/adjustments) $394,355 $361,183

Income Adjustments $76,683 $76,683

Fully Leased Net Income $471,038 $437,866

Capital Adjustments ($623,030) ($92,278)

Capitalisation Adopted $6,900,000 $6,900,000

Investment SummaryInvestment SummaryInvestment SummaryInvestment Summary

Capitalisation Rate 6.25%

Passing Initial Yield 5.69%

Passing Initial Yield plus Vacancies 6.80%

Equivalent Yield 6.41%

Reversionary Yield 6.32%

Value $psm of Lettable Area $9,591

Current Vacancy Rate 12.7%

Weighted Average Lease Term 1.77 years

VALUATION ASSUMPTIONSVALUATION ASSUMPTIONSVALUATION ASSUMPTIONSVALUATION ASSUMPTIONS

Leasing Up Period Yr 1 4 mths

Incentives Yr 1 3 mths

Assumed New Lease Term 5 years

TENANT PROFILETENANT PROFILETENANT PROFILETENANT PROFILE Area (sqm)Area (sqm)Area (sqm)Area (sqm) Gross Passing RentGross Passing RentGross Passing RentGross Passing Rent Gross Market RentGross Market RentGross Market RentGross Market Rent

Retail 60.0 $60,000 $60,000

Office 522.0 $375,557 $336,925

Monthly 48.0 $48,540 $54,000

Gross IncomeGross IncomeGross IncomeGross Income 630.0 484,097 450,925

Vacant 92.0 $87,450 $87,450

Bad Debt Allowance -$10,768 -$10,768

Total (Gross Passing Fully leased)Total (Gross Passing Fully leased)Total (Gross Passing Fully leased)Total (Gross Passing Fully leased) 722.0 $560,780 $527,608

29 August 201229 August 201229 August 201229 August 2012

$6,925,000$6,925,000$6,925,000$6,925,000

2 INTRODUCTION

Instructions

Original Instructions

Instructions: � Written instructions received from:

− Mr Kerry McCloy of Transvaal Investments Pty. Ltd, dated 14 August 2012.

− Refer to Appendices.

Valuation Request: � Current market value of:

− Chester House (Formerly), 1 Transvaal Avenue, Double Bay NSW 2028.

Reliance::

i.e. Reliant Party/Purpose & Basis of Valuation

� Commonwealth Bank of Australia (CBA) for First Mortgage Security only.

− Market Value - "As Is" - Subject to existing occupancy arrangements.

Reliance and Liability

Reliance: � This valuation is strictly and only for the use of the Reliant Party and for the Purpose specifically stated in Synopsis/Instructions.

Confidentiality: � This valuation is strictly confidential between CBRE and the Reliant Party.

Transmission: � Only an original valuation report received by the Reliant Party directly from CBRE without any third party intervention can be relied upon.

Restricted: � No responsibility is accepted or assumed to any third party who may use or rely on the whole or any part of the content of this valuation.

Copyright: � Neither the whole nor any part of the content of this valuation may be published in any document, statement, circular or otherwise by any party other than CBRE, nor in any communication with any third party, without the prior written approval from CBRE, and subject to any conditions determined by CBRE, including the form and context in which it is to appear.

Market Movement

Current as at the Date of Valuation:

� This valuation is current at the date of valuation only. The value assessed may change significantly and unexpectedly over a relatively short period of time (including as a result of general market movements or factors specific to the particular property or particular property sector). Liability for losses arising from such subsequent changes in value is excluded, as is liability where the valuation is relied upon after the date of the valuation.

Reliance Window:

� Without limiting the generality of the above comment, we do not assume any responsibility or accept any liability, nor should the valuation be relied upon, after the expiration of 3 months from the date of valuation, or such earlier date if the Reliant Party becomes aware of any factors that may have an effect on the valuation.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay Double Bay Double Bay Double Bay NSW 2028NSW 2028NSW 2028NSW 2028

Valuer’s Interest

Valuer’s Interest: � We hereby certify that the Principal Valuer is suitably qualified and authorised to practise as a valuer; does not have a pecuniary interest, financial or otherwise, that could conflict with the proper valuation of the property (including the parties with whom our client is dealing, including the lender or selling agent, if any); accepts instructions to value the property only from the instructing party.

Market Value Definitions

Market Value Definition:

� In accordance with the International Valuation Standard, the definition of market value is:

“Market Value is the estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing, wherein the parties had each acted knowledgeably, prudently and without compulsion.”

Industry Practice

Industry Practice: � Our report is issued in accordance with the Australian Property Institute Valuation and Property Standards (ISBN 0-9975414-0-1), subject to the assumptions detailed within this report.

Further Purpose & Scope of Report

Compliance Statement:

� This valuation has been performed in accordance with the International Valuation Standards (IVS) and we confirm that:

− The statements of fact presented in the report are correct to the best of the Valuer’s knowledge.

− The analyses and conclusions are limited only by the reported assumptions and conditions.

− The Valuer has no interest in the subject property.

− The Valuer’s fee is not contingent upon any aspect of the report.

− The valuation was performed in accordance with an ethical code and performance standards.

− The Valuer has satisfied professional education requirements.

− The Valuer has experience in the location and category of the property being valued.

− The Valuer has made a personal inspection of the property.

− No one, except those specified in the report, has provided professional assistance in preparing the report.

3 SITE DETAILS

Location

Precinct: � Eastern Suburbs.

Situation: � Situated on the eastern side of Transvaal Avenue, being approximately 25 metres from the intersection with Cross Street in Double Bay.

Location: � An established upmarket, boutique retail precinct fronting Transvaal Avenue, being approximately 3.5 kilometres radial distance in an eastern direction from the Sydney GPO.

Surrounds: � Predominantly single storey Federation terraces along Transvaal Avenue with low to medium density commercial/retail buildings interspersed along Cross Street.

Transport/Roads: � Edgecliff Railway Station is situated approximately 800 metres southwest of the subject property.

Regional Map:

Source: UBD

Local Map:

Source: UBD

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Double Double Double Bay NSW 2028Bay NSW 2028Bay NSW 2028Bay NSW 2028

Site & Services

Shape: � Generally regular.

Topography: � Relatively level throughout.

Land Area: � 421.9 sqm.

Street Frontage: � Transvaal Avenue: 12.825 metres.

Access: � Available from Transvaal Avenue.

Services: � Typical services are connected.

Flooding: � Our investigation of Woollahra Municipal Council records indicates the property is above known flood levels. Formal searches have not been undertaken.

Flooding Caution: We have relied upon flood We have relied upon flood We have relied upon flood We have relied upon flood informationinformationinformationinformation obtained from obtained from obtained from obtained from Woollahra Municipal CouncilWoollahra Municipal CouncilWoollahra Municipal CouncilWoollahra Municipal Council....

The quality, completeness and accuracy of flood mapping varies widely between localitiesThe quality, completeness and accuracy of flood mapping varies widely between localitiesThe quality, completeness and accuracy of flood mapping varies widely between localitiesThe quality, completeness and accuracy of flood mapping varies widely between localities and and and and CouncilsCouncilsCouncilsCouncils. We have not verified, and make no representation as to the appropriateness, . We have not verified, and make no representation as to the appropriateness, . We have not verified, and make no representation as to the appropriateness, . We have not verified, and make no representation as to the appropriateness, accuracy, reliability or currency of the flood mapping reviewed and accuracy, reliability or currency of the flood mapping reviewed and accuracy, reliability or currency of the flood mapping reviewed and accuracy, reliability or currency of the flood mapping reviewed and relied upon.relied upon.relied upon.relied upon.

The Reliant PartyThe Reliant PartyThe Reliant PartyThe Reliant Party may wish to confirm the may wish to confirm the may wish to confirm the may wish to confirm the flood mapping flood mapping flood mapping flood mapping information by obtaining an expert information by obtaining an expert information by obtaining an expert information by obtaining an expert hydrologist’s report. If hydrologist’s report. If hydrologist’s report. If hydrologist’s report. If further flooding data is obtained, we reserve the right to review and if further flooding data is obtained, we reserve the right to review and if further flooding data is obtained, we reserve the right to review and if further flooding data is obtained, we reserve the right to review and if necessary amend the valuation.necessary amend the valuation.necessary amend the valuation.necessary amend the valuation.

Site Survey Not Provided:

We do not commission site We do not commission site We do not commission site We do not commission site surveys and a site survey has not been provided to us. We havesurveys and a site survey has not been provided to us. We havesurveys and a site survey has not been provided to us. We havesurveys and a site survey has not been provided to us. We have assumed there are no encroachments by or on the property, and the Reliant Party should assumed there are no encroachments by or on the property, and the Reliant Party should assumed there are no encroachments by or on the property, and the Reliant Party should assumed there are no encroachments by or on the property, and the Reliant Party should confirm this status by obtaining a current survey report and/or advicconfirm this status by obtaining a current survey report and/or advicconfirm this status by obtaining a current survey report and/or advicconfirm this status by obtaining a current survey report and/or advice from a registered e from a registered e from a registered e from a registered surveyor. If any encroachments are noted by the survey report, surveyor. If any encroachments are noted by the survey report, surveyor. If any encroachments are noted by the survey report, surveyor. If any encroachments are noted by the survey report, this valuation must not be this valuation must not be this valuation must not be this valuation must not be relied upon before first consulting relied upon before first consulting relied upon before first consulting relied upon before first consulting CBRECBRECBRECBRE to reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuation....

Deposited Plan: � The property is illustrated on the Deposited Plan below, and we enclose a copy of the full Deposited Plan – refer to Appendices.

Site Contamination Risk

Our Enquiries: � Our enquiries are limited to our inspection and enquiries made with Representatives of the Registered Proprietor.

Past Use Comment:

� The past use of the property is difficult to ascertain as the current improvements have been on site in excess of 40 years.

� We have not been provided with an Environmental Site Audit.

We do not undertake historical site searches, and have therefore assumed former uses We do not undertake historical site searches, and have therefore assumed former uses We do not undertake historical site searches, and have therefore assumed former uses We do not undertake historical site searches, and have therefore assumed former uses did not did not did not did not cause site contamination.cause site contamination.cause site contamination.cause site contamination.

Present Use: � The present use of the property is passive office/retail use.

Contamination Comment:

� We enquired (refer above) if any of the following existed on site:

− Soil contamination, ground water contamination, underground storage tanks, drums and tanks, or other potentially contaminating or hazardous materials.

− To their knowledge none existed.

� We did not observe any evidence to contradict this response.

� We have undertaken an online search of the Environmental Protection Authority Register for Contaminated Land. The search revealed no listing of the subject property (refer to Appendices).

Formal Contamination Report Comment:

� We have specifically requested a current contamination report (less than 12 months old) for the property in its entirety, and are advised:

− A current report has not been commissioned.

Acid Sulfate Soils: � The subject is affected by Class 2 Acid Sulphate Soils. Any future development of the property requires an Acid Sulphate Soils Management Plan in accordance with the Acid Sulphate Soils Manual to be prepared. We do not believe that this will have an adverse affectation on the sale or marketability of the subject.

Surrounding Properties:

� Our visual inspection of the surrounding properties revealed:

− No obvious signs of potentially contaminating uses.

� Our valuation assumes no contamination issues associated with the adjoining property.

We Are Not Contamination Experts:

WeWeWeWe have assumed that the site is free of elevated levels of contaminants.have assumed that the site is free of elevated levels of contaminants.have assumed that the site is free of elevated levels of contaminants.have assumed that the site is free of elevated levels of contaminants. We have made no We have made no We have made no We have made no allowanceallowanceallowanceallowance in our valuation for site remediation works.in our valuation for site remediation works.in our valuation for site remediation works.in our valuation for site remediation works. OOOOur visual inspection is an ur visual inspection is an ur visual inspection is an ur visual inspection is an inconclusive indicator of the actual condition of the site. We make no representation as to the inconclusive indicator of the actual condition of the site. We make no representation as to the inconclusive indicator of the actual condition of the site. We make no representation as to the inconclusive indicator of the actual condition of the site. We make no representation as to the actual environmental status of the subject property. If a test is undertaken at actual environmental status of the subject property. If a test is undertaken at actual environmental status of the subject property. If a test is undertaken at actual environmental status of the subject property. If a test is undertaken at some time in the some time in the some time in the some time in the future to assess the degree, if any, of contamination of the site and this is found to be positive,future to assess the degree, if any, of contamination of the site and this is found to be positive,future to assess the degree, if any, of contamination of the site and this is found to be positive,future to assess the degree, if any, of contamination of the site and this is found to be positive, this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting CBRECBRECBRECBRE to reassess any effect on to reassess any effect on to reassess any effect on to reassess any effect on the valuationthe valuationthe valuationthe valuation....

Asbestos Risk

Likelihood of Asbestos:

� The principal improvements on the site are estimated to have been completed prior to 1990, and therefore the likely potential exists for Asbestos Containing Materials to form part of the building and/or its plant and equipment.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue DouDouDouDouble Bay NSW 2028ble Bay NSW 2028ble Bay NSW 2028ble Bay NSW 2028

Our Enquiries: � Our enquiries are limited to our inspection and enquiries made with Representatives of the Registered Proprietor.

Asbestos Audit Status:

� We have requested an Asbestos Containing Material (ACM) Register Audit and are advised:

− An audit has not been commissioned (which contravenes State legislation).

Asbestos Comment:

� We enquired (refer above) if any asbestos containing materials existed within the improvements which could be drawn to our attention. To their knowledge none existed. During our limited inspection, we did not observe any evidence to contradict this response.

We Are Not Hazardous Material Experts:

Unless otherwise noted, we have assumed that the improvements are free of Asbestos and Unless otherwise noted, we have assumed that the improvements are free of Asbestos and Unless otherwise noted, we have assumed that the improvements are free of Asbestos and Unless otherwise noted, we have assumed that the improvements are free of Asbestos and Hazardous Materials, or should these materials be present then they do not pose significant Hazardous Materials, or should these materials be present then they do not pose significant Hazardous Materials, or should these materials be present then they do not pose significant Hazardous Materials, or should these materials be present then they do not pose significant risk to human health, nor require immediate rrisk to human health, nor require immediate rrisk to human health, nor require immediate rrisk to human health, nor require immediate removal. emoval. emoval. emoval. We have made We have made We have made We have made no allowance in our no allowance in our no allowance in our no allowance in our valuation for remediation works.valuation for remediation works.valuation for remediation works.valuation for remediation works.

We assume the site is free of subsoil asbestos and have made no allowance in our valuation We assume the site is free of subsoil asbestos and have made no allowance in our valuation We assume the site is free of subsoil asbestos and have made no allowance in our valuation We assume the site is free of subsoil asbestos and have made no allowance in our valuation for site remediation worksfor site remediation worksfor site remediation worksfor site remediation works....

OurOurOurOur visual inspection is an inconclusive indicator of the actual condition/presenvisual inspection is an inconclusive indicator of the actual condition/presenvisual inspection is an inconclusive indicator of the actual condition/presenvisual inspection is an inconclusive indicator of the actual condition/presence of ce of ce of ce of asbestos/hazardous asbestos/hazardous asbestos/hazardous asbestos/hazardous materials within the materials within the materials within the materials within the propertypropertypropertyproperty. We make no representation as to the . We make no representation as to the . We make no representation as to the . We make no representation as to the actual status of the subject property. If a test is undertaken at some time in the future to actual status of the subject property. If a test is undertaken at some time in the future to actual status of the subject property. If a test is undertaken at some time in the future to actual status of the subject property. If a test is undertaken at some time in the future to assess the degree, if any, of the presence of assess the degree, if any, of the presence of assess the degree, if any, of the presence of assess the degree, if any, of the presence of any aany aany aany asbestossbestossbestossbestos/h/h/h/hazardous azardous azardous azardous mmmmaterials on site and aterials on site and aterials on site and aterials on site and this is found to be positive, this is found to be positive, this is found to be positive, this is found to be positive, this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting this valuation must not be relied upon before first consulting CBRECBRECBRECBRE to reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuation....

Real Property Description (Freehold)

Lot Plan Title Reference Area (sqm) Registered Owner Ownership Interest

1 DP580401 1/580401 421.9 Transvaal Investments Pty. Ltd. 100%

TotalTotalTotalTotal 421.9421.9421.9421.9

Title & Interests

Title: � We have conducted a Title search - refer to Appendices. (Note that depending on government requirements, this may not represent the actual status of leases relating to the property.)

Crown Grant: � We have not perused the original Crown Grant documentation.

Registered Interests (excluding Liens/ Caveats):

� Registered Interests listed on Title (excluding Liens/Caveats) are summarised as follows:

− Reservations and Conditions in the Crown Grant(s).

− BK 710 No 330 easement affecting the part of the land within described 1.22 metres wide in DP580401.

− 8218745 Mortgage to St. George Bank Limited.

− AE462391 Lease to Chagall International Pty Limited of Shop 1, 1 Transvaal Avenue, Double Bay. Expires: 31/1/2011. Option of renewal: Three years.

− AE462392 Lease to Chester Capital Pty Limited of Suite 3, Ground Floor, 1 Transvaal Avenue, Double Bay. Expires: 31/3/2011. Option of Renewal: Three years.

− AE462393 Lease to Nicole Terkasher of Suite 1, Level 1, 1 Transvaal Avenue, Double Bay. Expires: 20/7/2011. Option of Renewal: Three years.

− AF27485 Lease to Metro Commercial Partners Pty Ltd of Suite 4, First Floor, 1 Transvaal Ave, Double Bay. Expires: 31/1/2011. Option of Renewal: 3 years.

− AF477877 Lease to Rebecca Lucy Mullaney-Veitch of Shop 2, 1 Transvaal Avenue, Double Bay. Expires: 31/8/2012. Option of Renewal: 3 years.

− AG970134 this edition issued pursuant to S.111 Real Property Act, 1900.

� Refer to Appendices.

Liens: We have disregarded the presence of any mortgage or other financial liens We have disregarded the presence of any mortgage or other financial liens We have disregarded the presence of any mortgage or other financial liens We have disregarded the presence of any mortgage or other financial liens pertaining to the pertaining to the pertaining to the pertaining to the property.property.property.property.

Caveats: We have disregarded the presence of any caveats pertaining to the property.We have disregarded the presence of any caveats pertaining to the property.We have disregarded the presence of any caveats pertaining to the property.We have disregarded the presence of any caveats pertaining to the property.

Unregistered Interests:

We have assumed that there are no We have assumed that there are no We have assumed that there are no We have assumed that there are no unregistered interests unregistered interests unregistered interests unregistered interests which may affect market value.which may affect market value.which may affect market value.which may affect market value. InInInIn the event that the Relianthe event that the Relianthe event that the Relianthe event that the Reliant Party becomes aware of t Party becomes aware of t Party becomes aware of t Party becomes aware of any any any any further further further further or pending or pending or pending or pending easementseasementseasementseasements,,,, encumbrances or encumbrances or encumbrances or encumbrances or unregistered interestsunregistered interestsunregistered interestsunregistered interests, this valuation must not be relied upon before first , this valuation must not be relied upon before first , this valuation must not be relied upon before first , this valuation must not be relied upon before first consulting consulting consulting consulting CBRECBRECBRECBRE to reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuation....

Town Planning

Local Authority: � Woollahra Municipal Council.

Zoning: � 3(a) Business General.

Zoning Objectives: � The objectives are:

(a) to define the main commercial areas within the Council's area which provide for a wide range of retail and commercial uses, ancillary light industrial uses, entertainment, social and recreational uses, tourist accommodation and residential development mixed with non-residential uses,

(b) to encourage employment generating uses in accessible localities,

(c) to allow for residential development in the form of mixed development so as to encourage urban consolidation and promote the vitality of business centres, and

(d) to control the physical and functional characteristics of business centres in order to minimise their impact on neighbouring residential lands.

Local Plan: � Woollahra Local Environmental Plan (LEP) 1995.

Floor Space Ratio (FSR):

� According to the Woollahra Local Environmental Plan (LEP) 1995, the subject has a maximum allowable FSR of 2.5:1.

� Double Bay Centre Development Control Plan 2002 indicates that properties in Transvaal Avenue have a maximum allowable FSR of 1:1.

� We have adopted the prescribed maximum allowable FSR of 2.5:1 from the Woollahra Local Environmental Plan (LEP) 1995 as being applicable to the subject.

Height Limit: � According to the Double Bay Centre Development Control Plan 2002, the subject has a maximum building height limit of 4 storeys to the front half of the site, with 2 storeys to the remaining rear half of the subject.

Existing Use: � Appears to conform.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1 Transvaal Avenue1 Transvaal Avenue1 Transvaal Avenue1 Transvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Prohibited Uses: Development for the purposes of:

� Amusement centres; amusement parks; backpackers' hostels; boarding houses (other than mixed developments); bulk stores; bus depots; car repair stations (other than those forming part of, and used in conjunction with, a service station); dwelling-houses; gas holders; generating works; helipads; heliports; industries (other than light industries or those ancillary or complementary to development not otherwise prohibited in the zone); institutions; junk yards; liquid fuel depots; panel beating and spray painting; residential flat buildings (other than mixed developments); road transport terminals; service stations in a business zone at Edgecliff; warehouses.

Development Controls:

� Double Bay Centre Development Control Plan 2002.

Occupancy Certificate:

� We have not sighted an Occupancy Certificate for the subject.

Development Applic/Approvals:

� Verbal enquiries with Woollahra Municipal Council have indicated that the subject has a lapsed DA (306/2006/1) for substantial alterations to the existing building including an additional storey.

Heritage: � Our online search of council records identified the following Heritage issue:

− The subject is positioned within a Heritage Conservation Area.

� This is not expected to have an adverse affectation on the sale or marketability of the subject.

Native Title: � The subject property is not expected to be subject to Native Title issues. Searches were not undertaken.

Planning Information:

It is assumed that inIt is assumed that inIt is assumed that inIt is assumed that information provided to us by the relevant Local Authority Town Planning formation provided to us by the relevant Local Authority Town Planning formation provided to us by the relevant Local Authority Town Planning formation provided to us by the relevant Local Authority Town Planning Department (and/or third party providers such as Anstat) accurately reflect the current Department (and/or third party providers such as Anstat) accurately reflect the current Department (and/or third party providers such as Anstat) accurately reflect the current Department (and/or third party providers such as Anstat) accurately reflect the current planning scheme. In the event that a Town Planning Certificate or any other relevant planning scheme. In the event that a Town Planning Certificate or any other relevant planning scheme. In the event that a Town Planning Certificate or any other relevant planning scheme. In the event that a Town Planning Certificate or any other relevant planning inplanning inplanning inplanning information or document is obtained and the information is found to be different to formation or document is obtained and the information is found to be different to formation or document is obtained and the information is found to be different to formation or document is obtained and the information is found to be different to the town planning information in this report, this valuation must not be relied upon before first the town planning information in this report, this valuation must not be relied upon before first the town planning information in this report, this valuation must not be relied upon before first the town planning information in this report, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. consulting CBRE to reassess any effect on the valuation. consulting CBRE to reassess any effect on the valuation. consulting CBRE to reassess any effect on the valuation.

Statutory Assessment

Statutory Assessment:

Source: NSW Land

and Property

Information

� As at 1 July 2011:

− Site Value: $2,160,000 ($5,120 psm)

The above assessment is used for calculating Land Tax and Council Rates charges.The above assessment is used for calculating Land Tax and Council Rates charges.The above assessment is used for calculating Land Tax and Council Rates charges.The above assessment is used for calculating Land Tax and Council Rates charges.

4 IMPROVEMENTS

Property Description

Overview: � The subject as currently configured is improved with a modernised circa 1970's three storey commercial building incorporating 14 office and 2 retail tenancy areas. The property is positioned in an upmarket boutique eastern suburbs retail precinct.

Lettable Area

BUILDING AREA ANALYSIS Lettable Area %

(sqm)

Retail 60.0 8.3%

Office 522.0 72.3%

Monthly 48.0 6.6%

Vacant 92.0 12.7%

TotalTotalTotalTotal 722.0722.0722.0722.0 100.0%100.0%100.0%100.0%

Retai l

Offi ce

72% Monthl y

Vacant

13%

Measurement of Lettable Areas:

� Floor areas have been calculated by reference to the tenancy schedule provided by Representatives of the Registered Proprietor, and are approximate only.

Should the Reliant Party obtain a survey to determine whether the areas relied upon differ Should the Reliant Party obtain a survey to determine whether the areas relied upon differ Should the Reliant Party obtain a survey to determine whether the areas relied upon differ Should the Reliant Party obtain a survey to determine whether the areas relied upon differ frfrfrfrom Property Council of om Property Council of om Property Council of om Property Council of AustraliaAustraliaAustraliaAustralia guidelines and the survey reveals a variance in areas, then guidelines and the survey reveals a variance in areas, then guidelines and the survey reveals a variance in areas, then guidelines and the survey reveals a variance in areas, then this valuationthis valuationthis valuationthis valuation must not be relied upon before first consulting CBRE to reassemust not be relied upon before first consulting CBRE to reassemust not be relied upon before first consulting CBRE to reassemust not be relied upon before first consulting CBRE to reassess any effect on ss any effect on ss any effect on ss any effect on the valuation.the valuation.the valuation.the valuation.

Accommodation

Ground Level Retail Accommodation:

� Shop 1 has direct albeit partially obscured street exposure to Transvaal Avenue via a 4.5 metre frontage. There are some columns in front of the shop where there is a covered awning. The property benefits from signage at the front of the building. Shop 1 is utilised as a hairdresser salon. At the front of the tenancy area is a full height glazed shopfront with swing door entry. The shop is open planned and features a reception area, two aisles, mirrored walls, built in cupboards, timber benchtops and single stainless steel sink as well as a kitchenette to the rear. The kitchenette features timber benchtops/cupboards, single stainless steel sink, Bosch washing machine and Hoover dryer. This tenancy area is serviced by ducted air conditioning and is in good condition.

� Shop 2 has an approximate 4.3 metre frontage to Transvaal Avenue and a 3.5 metre frontage to the external walkway along the southern elevation of the building. Like Shop 1, Shop 2 is partially obscured by columns and is set back from the street. Shop 2 is currently vacant. Shop 2 has a full height shopfront with swing door, open plan retail area, service counter and two rear storage rooms, one of which has a hand basin. There is slight damage to the plasterboard ceiling to the rear of the shop. This tenancy area is serviced by split system air conditioning and is also in good condition.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1 Transvaal Av1 Transvaal Av1 Transvaal Av1 Transvaal Avenueenueenueenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Shop 1

Shop 2

Ground Level Office Accommodation:

� Suite 3 is positioned to the rear of the ground level via the external walkway along the building’s southern elevation. Access to the adjoining Council carpark is also provided along the walkway. Suite 3 benefits from signage at the front of the building as well as naming rights for the building. This is tenanted by Lindamood-Bell Learning Processes. Suite 3 has a full height glazed shopfront to the side walkway. Suite 3 has a reception, open plan office area, five glass partitioned offices, kitchenette, unisex bathroom and access to the enclosed external courtyard. The kitchenette comprises timber benchtops/cupboards and a single stainless steel sink. The unisex bathroom features a vanity and WC. Suite 3 presents well and is in good condition.

Suite 3, Ground Floor

External Elevation from Transvaal Avenue

Level 1 Office Accommodation:

� Access to the upper levels is provided from an internal staircase to the southwestern corner of the building. The staircase features the tenant directory of the building. All tenancy and common areas on Level 1 are serviced by ducted air conditioning. Level 1 consists of three separate tenancy areas, Suite 1, 2 and 4. Common amenities comprise a kitchenette together with separate male and female amenities. The kitchenette features caesarstone benchtops, glass splashback, timber cupboards, single stainless steel sink and fire extinguisher. Male amenities feature automatic sensor lighting, two hand basins, mirrored walls, two urinals and two WCs. Level 1 comprises three separate office tenancy areas.

� Suite 1 is leased to Nicole Terkasher trading as Nicole Leggatt and Associates Lawyers. Suite 1 also has street signage to Transvaal Avenue. Suite 1 comprises a timber framed glazed swing entry door, reception with caesarstone benchtop, filing cupboard, four plasterboard partitioned offices, two of which have built in cupboards, boardroom, data/photocopying room and external covered balcony which provides good natural light to the office. Suite 1 also features intercom entry and a fire extinguisher. The tenancy area is in good condition.

� Suite 2 comprises an open plan office with three workstations. The suite is leased to Elle Promotions. Its external elevation abuts the adjoining building and limited natural light is provided to the suite. Suite 2 is in overall average condition.

� Suite 4 is leased by Metro Commercial Partners and features a reception with benchtop, open plan office with four workstations, built in cupboards, three plasterboard/glass partitioned offices, data room with four workstations and external covered courtyard with garden planter. Suite 4 also has street signage to Transvaal Avenue. Good natural light is provided to the tenancy area. Suite 4 presents well and is in good condition overall.

Suite 1, Level 1

Suite 2, Level 1

Suite 4, Level 1

Level 2 Office Accommodation:

� Level 2 is accessed via the internal staircase located to the southwestern corner of the building. Secure access is provided to Level 2 via a video intercom and swipe card. Level 2 office suites and common area is serviced by ducted air conditioning.

� Common areas comprise a waiting area with skylight, reception with granite benchtop, large hallway with wall shelving, kitchenette and separate male and female amenities. The kitchenette features timber benchtops/cupboards and single stainless steel sink. Male amenities feature two granite vanities, timber cupboards, mirrored walls, paper dispenser, two urinals and two WCs. The kitchenette and amenities are in average condition compared to the remainder of the level.

� Positioned mainly to the external elevations are 12 suites leased on a separate basis with Suite 12 currently vacant. Three of the offices (Suites 7-9) are combined to form a single tenancy area with video intercom access. Each of the suites comprises a room with secure keypad access. Suites 1-3 also benefit from exclusive access to an enclosed external balcony and good natural light. The suites are relatively small and range in size from 8.0 square metres up to 49.0 square metres. Level 2 appears to have been refurbished in the last 10 years and is in overall good condition.

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1 Transvaa1 Transvaa1 Transvaa1 Transvaal Avenuel Avenuel Avenuel Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Level 2 Common Area

Suite 12, Level 2

Suite 11, Level 2

Suite 2, Level 2

Construction: � Structure: Brick structural walls and concrete columns.

� Floors: Reinforced concrete.

� External Walls: Predominantly aluminium framed curtain wall cladding, face, painted and rendered brick walls.

� Windows/Doors: Single glazed aluminium/timber framed glass windows and swing doors.

� Roof: Unsighted, assumed to be tiled.

Internal Finishes: � Entry Foyer: Tiled floors, plasterboard ceilings and rendered walls.

� Floors: Carpet to office areas with tiled floor coverings to reception, wet and retail tenancy areas.

� Walls: Rendered brick, full height glazed and plasterboard lined internal walls.

� Ceilings: Plasterboard ceilings to retail areas, suspended grid fibrous plaster ceilings to office tenancy areas.

� Amenities: Tiled floors, part tiled and rendered brick walls with plasterboard ceilings.

Services: � Air Conditioning: Ducted air conditioning throughout except Shop 2 which is serviced instead by a split system air conditioning unit.

� Fire Prevention: The building is fully fitted with smoke detectors and fire extinguishers.

� Security/Access Control:

Level 2 has secure video intercom and swipe card entry. Each of the suites on Level 2 (except Suite 12) additionally has secure keypad entry.

� Lifts: Each of the upper levels is accessed via an internal staircase.

Condition & Repair

Overall Condition: � The property appears to be in good condition having regard to its age and use.

External/Internal Condition:

� The external elevations appear to be in good repair, and the internal common areas are in good condition.

Capital Expenditure

Capital Expenditure Adopted:

� We have requested but have not been provided with any budgeted capital expenditure items, however during our inspection we noted the following issues requiring attention:

− Installation of partition walls for Suite 12 on Level 2.

� Accordingly, we have adopted a total capital expenditure amount of $12,500 within our calculations.

Structure and Facilities:

We do not commission We do not commission We do not commission We do not commission Structural Structural Structural Structural Surveys and a Structural Survey has not been provided to us.Surveys and a Structural Survey has not been provided to us.Surveys and a Structural Survey has not been provided to us.Surveys and a Structural Survey has not been provided to us. We have notWe have notWe have notWe have not tested any of the services or facilitiestested any of the services or facilitiestested any of the services or facilitiestested any of the services or facilities, nor , nor , nor , nor inspected unexposed or inaccessible inspected unexposed or inaccessible inspected unexposed or inaccessible inspected unexposed or inaccessible portions of the buildingportions of the buildingportions of the buildingportions of the building,,,, and are therefore unable to state that and are therefore unable to state that and are therefore unable to state that and are therefore unable to state that these are these are these are these are free from defectfree from defectfree from defectfree from defect, rot , rot , rot , rot or or or or infestation.infestation.infestation.infestation. We We We We assumeassumeassumeassume the the the the property property property property complies with all relevant statutory requirements in complies with all relevant statutory requirements in complies with all relevant statutory requirements in complies with all relevant statutory requirements in respect respect respect respect totototo health, buildinghealth, buildinghealth, buildinghealth, building,,,, and fire safety regulations. If the and fire safety regulations. If the and fire safety regulations. If the and fire safety regulations. If the Reliant PartyReliant PartyReliant PartyReliant Party becomes awabecomes awabecomes awabecomes aware of re of re of re of any information contrary to these assumptions, any information contrary to these assumptions, any information contrary to these assumptions, any information contrary to these assumptions, ththththis is is is valuationvaluationvaluationvaluation must not be relied upon before must not be relied upon before must not be relied upon before must not be relied upon before first consulting first consulting first consulting first consulting CBRECBRECBRECBRE to reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuationto reassess any effect on the valuation....

Inclusions & Exclusions:

OurOurOurOur valuation includes those items that valuation includes those items that valuation includes those items that valuation includes those items that formformformform part of the building service installations such part of the building service installations such part of the building service installations such part of the building service installations such as as as as heating and cooling equipment, lifts, sprinklers, lighting, etc., that would normally pass with heating and cooling equipment, lifts, sprinklers, lighting, etc., that would normally pass with heating and cooling equipment, lifts, sprinklers, lighting, etc., that would normally pass with heating and cooling equipment, lifts, sprinklers, lighting, etc., that would normally pass with the sale of the property, but excludes all items of plant, machinery, equipment, partitions, the sale of the property, but excludes all items of plant, machinery, equipment, partitions, the sale of the property, but excludes all items of plant, machinery, equipment, partitions, the sale of the property, but excludes all items of plant, machinery, equipment, partitions, furniture and other such items which may have been installed (byfurniture and other such items which may have been installed (byfurniture and other such items which may have been installed (byfurniture and other such items which may have been installed (by the occupantthe occupantthe occupantthe occupant/operator/operator/operator/operator) or ) or ) or ) or are used in connection with the are used in connection with the are used in connection with the are used in connection with the enterprise enterprise enterprise enterprise carried on within the propertycarried on within the propertycarried on within the propertycarried on within the property....

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1 Tran1 Tran1 Tran1 Transvaal Avenuesvaal Avenuesvaal Avenuesvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

5 OCCUPANCY DETAILS

Tenancy Summary

Overview of Leases:

� As currently leased and configured: 16 tenancies, with 10 occupied under formal lease agreements, 2 currently vacant, and 4 occupied under a monthly agreement.

� The tenancy configuration and major tenant lease expiry profile is summarised as follows:

TENANCY CONFIGURATION ANALYSIS Area Remaining

(sqm) Lease Term

Giancarlo Aymonod 60.0 4.18 years

Lindamood-Bell Learning Processes 174.0 2.84 years

NLA Legal 95.0 1.89 years

Elle Promotions 51.0 0.18 years

Metro Commercial Partners 110.0 1.42 years

Weighted Average Remaining Term 2.30 years Total ComplexTotal ComplexTotal ComplexTotal Complex by areaby areaby areaby area

% National/Chain Tenants% National/Chain Tenants% National/Chain Tenants% National/Chain Tenants 0.0%0.0%0.0%0.0%

% Local Tenants% Local Tenants% Local Tenants% Local Tenants 80.6%80.6%80.6%80.6%

Other Tenancies 92.0 0.70 years % Government Tenants% Government Tenants% Government Tenants% Government Tenants 0.0%0.0%0.0%0.0%

Monthly 48.0 % Monthly Tenants% Monthly Tenants% Monthly Tenants% Monthly Tenants 6.6%6.6%6.6%6.6%

Vacant 92.0 % Vacant% Vacant% Vacant% Vacant 12.7%12.7%12.7%12.7%

TotalTotalTotalTotal 722.0722.0722.0722.0 1.77 years1.77 years1.77 years1.77 years 100.00%100.00%100.00%100.00%

Major Tenancies: � The major tenant leases are summarised below and over the following pages.

Lease Structure: � The leased retail tenancy is occupied on a lease term of 5 years additionally incorporating a further renewal option period.

� All leases are structured on a gross basis and outgoings are not payable by the tenants.

LEASE SUMMARY

Lease DetailsLease DetailsLease DetailsLease Details Rental IncomeRental IncomeRental IncomeRental Income $pa $psm

Lessee: Giancarlo Aymonod Contract Rent $1,000

Tenancy Area (sqm): Outgoings Recoveries $0

Premises: Total Rent $1,000

Lease Term (yrs):

Option Period/s (yrs): Other IncomeOther IncomeOther IncomeOther Income

Commencement Date: No. of Car Parks 0

Expiry Date: Car Park Income $0

Next Review: Other Income $0

Information Source:Information Source:Information Source:Information Source: Lease:

Rent:

Registered:

GST Lease provides for recovery of GST on rent and outgoings.

Not noted on title as a registered dealing.

Tenancy information provided by Representatives of the Registered Proprietor.

Lease sighted and signed.

Early Termination/ Early Termination/ Early Termination/ Early Termination/

Break Clause:Break Clause:Break Clause:Break Clause:

None noted within the lease.

Incentive:Incentive:Incentive:Incentive: 3 months rent free; expensed.

Make Good Provisions:Make Good Provisions:Make Good Provisions:Make Good Provisions: Lessee to repaint every five years and in the last year of term.

Permitted Use:Permitted Use:Permitted Use:Permitted Use: Hairdresser and retail sale of hair and beauty products.

$60,000

Rent Reviews:Rent Reviews:Rent Reviews:Rent Reviews: Annual CPI+1% reviews.

60.0 sqm

Ground, Shop 1

1 November 2011

31 October 2016

1 November 2012

Outgoings Contribution:Outgoings Contribution:Outgoings Contribution:Outgoings Contribution: Lessor to pay all outgoings.

LEASE SUMMARY

Lease DetailsLease DetailsLease DetailsLease Details Rental IncomeRental IncomeRental IncomeRental Income $pa $psm

Lessee: Lindamood-Bell Learning Processes Contract Rent $592

Tenancy Area (sqm): Outgoings Recoveries $0

Premises: Total Rent $592

Lease Term (yrs):

Option Period/s (yrs): Oth er In comeOth er In comeOth er In comeOth er In come

Commencement Date: No. of Car Parks 0

Expiry Date: Car Park Income $0

Next Review: Other Income $0

Information Source:Information Source:Information Source:Information Source: Lease:

Rent:

Registered:

GST

$103,000

Not noted on title as a registered dealing.

Lease provides for recovery of GST on rent and outgoings.

Tenancy information provided by Representatives of the Registered Proprietor.

1 January 2013

174.0 sqm

Ground, Suite 3

3.5

1 January 2012

Lease sighted and signed.

Early Ter mination/ Early Ter mination/ Early Ter mination/ Early Ter mination/

Br eak Clause:Br eak Clause:Br eak Clause:Br eak Clause:

None noted within the lease.

Incentive:Incentive:Incentive:Incentive: 3 months rent free; assumed to be expensed.

Permitted Use:Permitted Use:Permitted Use:Permitted Use: Commercial offices and/or as a speech therapist centre for adults and children.

Outgoings Contribution:Outgoings Contribution:Outgoings Contribution:Outgoings Contribution: Lessor to pay all outgoings.

Rent Reviews:Rent Reviews:Rent Reviews:Rent Reviews: Annual 3.5% reviews.

30 June 2015

LEASE SUMMARY

Lease DetailsLease DetailsLease DetailsLease Details Rental IncomeRental IncomeRental IncomeRental Income $pa $psm

Lessee: NLA Legal Contract Rent $689

Tenancy Area (sqm): Outgoings Recoveries $0

Premises: Total Rent $689

Lease Term (yrs):

Option Period/s (yrs): Oth er In comeOth er In comeOth er In comeOth er In come

Commencement Date: No. of Car Parks 0

Expiry Date: Car Park Income $0

Next Review: Other Income $0

Information Source:Information Source:Information Source:Information Source: Lease:

Rent:

Registered:

GST

$65,485

The previous lease is noted on title as a registered dealing.

Lease provides for recovery of GST on rent and outgoings.

Tenancy information provided by Representatives of the Registered Proprietor.

21 July 2013

95.0 sqm

Level 1, Suite 1

21 July 2011

Lease sighted and signed.

Early Termination/ Early Termination/ Early Termination/ Early Termination/

Break Clause:Break Clause:Break Clause:Break Clause:

The lease has a 6 month demolition clause which can be triggered by the Lessor.

Incentive:Incentive:Incentive:Incentive: None noted within the lease.

Make Good Provisions:Make Good Provisions:Make Good Provisions:Make Good Provisions: Lessee to repaint every three years and in the last year of term.

Permitted Use:Permitted Use:Permitted Use:Permitted Use: Offices.

Outgoings Contribution:Outgoings Contribution:Outgoings Contribution:Outgoings Contribution: Lessor to pay all outgoings.

Rent Reviews:Rent Reviews:Rent Reviews:Rent Reviews: Annual CPI reviews.

20 July 2014

Chester House (Formerly)Chester House (Formerly)Chester House (Formerly)Chester House (Formerly) 1 1 1 1 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

LEASE SUMMARY

Lease DetailsLease DetailsLease DetailsLease Details Rental IncomeRental IncomeRental IncomeRental Income $pa $psm

Lessee: Elle Promotions Contract Rent $636

Tenancy Area (sqm): Outgoings Recoveries $0

Premises: Total Rent $636

Lease Term (yrs):

Option Period/s (yrs): Other IncomeOther IncomeOther IncomeOther Income

Commencement Date: No. of Car Parks 0

Expiry Date: Car Park Income $0

Next Review: Other Income $0

Information Source:Information Source:Information Source:Information Source: Lease:

Rent:

Registered:

GST

$32,448

Not noted on title as a registered dealing.

Lease provides for recovery of GST on rent and outgoings.

Tenancy information provided by Representatives of the Registered Proprietor.

4 November 2012

51.0 sqm

Level 1, Suite 2

4 November 2010

Lease sighted and signed.

Early Termination/ Early Termination/ Early Termination/ Early Termination/

Break Clause:Break Clause:Break Clause:Break Clause:

The lease has a 6 month demolition clause which can be triggered by the Lessor.

Incentive:Incentive:Incentive:Incentive: 3 months rent free; expensed.

Make Good Provisions:Make Good Provisions:Make Good Provisions:Make Good Provisions: Lessee to repaint in the last year of term.

Permitted Use:Permitted Use:Permitted Use:Permitted Use: Offices.

Outgoings Contribution:Outgoings Contribution:Outgoings Contribution:Outgoings Contribution: Lessor to pay all outgoings.

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3 November 2012

LEASE SUMMARY

Lease DetailsLease DetailsLease DetailsLease Details Rental IncomeRental IncomeRental IncomeRental Income $pa $psm

Lessee: Metro Commercial Partners Contract Rent $752

Tenancy Area (sqm): Outgoings Recoveries $0

Premises: Total Rent $752

Lease Term (yrs):

Option Period/s (yrs): Other IncomeOther IncomeOther IncomeOther Income

Commencement Date: No. of Car Parks 0

Expiry Date: Car Park Income $0

Next Review: Other Income $0

Information Source:Information Source:Information Source:Information Source: Lease:

Rent:

Registered:

GST

$82,677

The previous lease is noted on title as a registered dealing.

Lease provides for recovery of GST on rent and outgoings.

Tenancy information provided by Representatives of the Registered Proprietor.

1 February 2013

110.0 sqm

Level 1, Suite 4

1 February 2011

Lease sighted and signed.

Early Termination/ Early Termination/ Early Termination/ Early Termination/

Break Clause:Break Clause:Break Clause:Break Clause:

The lease has a 6 month demolition clause which can be triggered by the Lessor.

Incentive:Incentive:Incentive:Incentive: None noted within the lease.

Make Good Provisions:Make Good Provisions:Make Good Provisions:Make Good Provisions: Lessee to yield up premises in good repair prior to expiry of the lease.

Permitted Use:Permitted Use:Permitted Use:Permitted Use: Offices.

Outgoings Contribution:Outgoings Contribution:Outgoings Contribution:Outgoings Contribution: Lessor to pay all outgoings.

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31 January 2014

Lease Expiry Analysis

LEASE EXPIRY ANALYSIS

Year Tenancies Lettable Area Gross Rent

No. % of Total (sqm) % of Total $pa % of Total

Vacant 2 12.50% 92.0 12.7% 87,450 15.3%

Monthly 4 25.00% 48.0 6.6% 48,540 8.5%

2012 4 25.00% 114.0 15.8% 94,705 16.6%

2013 0 0.00% - 0.0% - 0.0%

2014 4 25.00% 234.0 32.4% 177,852 31.1%

2015 1 6.25% 174.0 24.1% 103,000 18.0%

2016 1 6.25% 60.0 8.3% 60,000 10.5%

TOTALTOTALTOTALTOTAL 16161616 100.0%100.0%100.0%100.0% 722.0722.0722.0722.0 100.0%100.0%100.0%100.0% 571,547571,547571,547571,547 100.0%100.0%100.0%100.0%

SUMMARY

Year Tenancies Lettable Area Gross Rent

No. % of Total (sqm) % of Total $pa % of Total

Vacant 2 12.5% 92.0 12.7% 87,450 15.3%

Monthly 4 25.0% 48.0 6.6% 48,540 8.5%

< 2 years 4 25.0% 114.0 15.8% 94,705 16.6%

2 - 5 years 6 37.5% 468.0 64.8% 340,852 59.6%

TOTALTOTALTOTALTOTAL 16161616 100.0%100.0%100.0%100.0% 722.0722.0722.0722.0 100.0%100.0%100.0%100.0% 571,547571,547571,547571,547 100.0%100.0%100.0%100.0%

Vacant

15% Monthl y

< 2 years

17%

2 - 5 years

60%

Lease Expiry By Income

10%

20%

30%

40%

Vacant Monthly 2012 2013 2014 2015 2016

Lease Expiry By % of Total Area

The above analysis includes anticipated market rental associated with any vacant space.

� Comments

− A gradually increasing proportion of leases are subject to expiry towards 2014.

− Expiries during 2014 represent approximately 30.9% of the total lettable area, with these tenants contributing approximately 29.1% of the gross rental income on a fully leased basis.

− Active management and concerted re-negotiation should minimise potential risks posed by these impending expiries.

Tenancy Issues

Vacant Tenancies: � Vacancies are summarised below, and appropriate leasing up, incentive, and agents’ commission allowances have been included within our calculations.

� We understand that the owner is in negotiation to lease Shop 2 and Suite 12, Level 2, trying to achieve a gross rate of $1,628 and $780 psm respectively.

Tenant Area

No. (sqm) $pa $psm

Ground, Shop 2 43.0 58,050 1,350 -19,350 -6,966 -14,513

Level 2, Suite 12 49.0 29,400 600 -9,800 -3,528 -7,350

Market Rent Letting Up Allowance

(4 mths)

Leasing Commission

(12%)

Letting Up Allowance

(3 mths)

Chester House (FormerlyChester House (FormerlyChester House (FormerlyChester House (Formerly)))) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Monthly Tenancies:

� Monthly tenants, along with our assessment of market rent for these tenancies, are summarised below.

� We have assumed these tenancies will be converted to formal lease agreements within 1 month from the date of valuation.

� We have applied appropriate reversion adjustments for those considered to be occupied at rentals which are above or below market parameters.

Tenant Tenant Area

No. Name (sqm) $pa $psm $pa $psm

Level 2, Suite 1 Peak Consulting 18.0 16,900 939 18,000 1,000

Level 2, Suite 4 Sunday Morning Records 8.0 8,040 1,005 9,600 1,200

Level 2, Suite 5 Blue Sky Events 11.0 13,200 1,200 13,200 1,200

Level 2, Suite 6 Sumo Health and Harmony 11.0 10,400 945 13,200 1,200

Current Rent Market Rent

Rental Abatements/ Outstanding Incentives:

� There are no rental abatements or outstanding incentives due.

Rental Arrears: � We have specifically requested and representatives of the Registered Proprietor have advised that there are no rental arrears.

Tenancy Schedule

Our understanding of the tenancy status is summarised overleaf.

Tenancy Schedule

Level/Unit/ Tenant Lettable Area Term Opt. Comm Expiry Next Review

Premises Name (sqm) $pa $psm $pa $psm (yrs) (yrs) Date Date Review Type

Ground, Shop 1 Giancarlo Aymonod 60.0 60,000 1,000 0 5.00 5.00 01-Nov-11 31-Oct-16 1-Nov-12 CPI+1%

Ground, Shop 2 Vacant 43.0 0 0 0

Ground, Suite 3 Lindamood-Bell Learning Processes 174.0 103,000 592 0 0 3.50 3.00 01-Jan-12 30-Jun-15 1-Jan-13 3.5%

Level 1, Suite 1 NLA Legal 95.0 65,485 689 0 0 3.00 3.00 21-Jul-11 20-Jul-14 21-Jul-13 CPI

Level 1, Suite 2 Elle Promotions 51.0 32,448 636 0 0 2.00 0.00 04-Nov-10 3-Nov-12 4-Nov-12 4.0%

Level 1, Suite 4 Metro Commercial Partners 110.0 82,677 752 0 0 3.00 0.00 01-Feb-11 31-Jan-14 1-Feb-13 4.0%

Level 2, Suite 1 Peak Consulting 18.0 16,900 939 0 0 0.50 0.00 23-Mar-10 22-Sep-10 23-Sep-10 MKT

Level 2, Suite 2 FAL Capital 18.0 18,250 1,014 0 0 2.00 0.00 01-Mar-12 28-Feb-14 1-Mar-13 CPI+1%

Level 2, Suite 3 The Property Factory 13.0 20,857 1,604 0 0 1.00 0.00 01-Jan-12 31-Dec-12 1-Jan-13 MKT

Level 2, Suite 4 Sunday Morning Records 8.0 8,040 1,005 0 0 1.00 0.00 01-Oct-08 30-Sep-09 1-Oct-09 MKT

Level 2, Suite 5 Blue Sky Events 11.0 13,200 1,200 0 0 0.08 0.00 04-Mar-10 3-Mar-10 4-Mar-10 MKT

Level 2, Suite 6 Sumo Health and Harmony 11.0 10,400 945 0 0 1.00 0.00 21-Dec-10 20-Dec-11 21-Dec-11 MKT

Level 2, Suites 7-9 Seemedia Group 36.0 30,000 833 0 0 1.00 0.00 18-Nov-11 17-Nov-12 18-Nov-12 MKT

Level 2, Suite 10 Veuve 14.0 11,400 814 0 0 0.50 0.00 22-Mar-12 22-Sep-12 23-Sep-12 MKT

Level 2, Suite 11 Fusion Brands Australia 11.0 11,440 1,040 0 0 2.00 0.00 03-Sep-12 2-Sep-14 3-Sep-13 CPI+1%

Level 2, Suite 12 Vacant 49.0 0 0 0 0

SUB TOTAL 16 722.0 484,097 670 0 0.00

TOTALTOTALTOTALTOTAL 722.0722.0722.0722.0 484,097484,097484,097484,097 670670670670 0000

Base Contract Rent Outgoings

Chester House (FormChester House (FormChester House (FormChester House (Formerly)erly)erly)erly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Outgoings

Outgoings: � We have been provided with actual outgoings for the financial year 2012-2013. These are tabulated below.

Adjustments: � In order to arrive at our opinion of anticipated outgoings during the forthcoming 12 months, we have made the following adjustments:

− Adopted an Air-conditioning and Ventilation expense of $3,500 per annum.

− Adopted a Common Area Cleaning expense of $6,500 per annum.

− Adopted a Repairs and Maintenance expense of $5,500 per annum.

− Adopted a Security/Access Control expense of $1,750 per annum.

− Adopted an Administration/Management expense of $16,500 per annum.

Rate Reflected: � The outgoings estimate adopted reflects an overall rate of $124 psm.

OUTGOINGS SCHEDULE Actual 2012-2013

$pa $psm $pa $psm

Council Rates 8,738 12 8,738 12

Water & Sewerage Rates 812 1 812 1

Land Tax 26,743 37 26,743 37

Insurance 9,775 14 9,775 14

Airconditioning & Ventilation 0 3,500 5

Common Area Cleaning 0 6,500 9

Electricity 6,589 9 6,589 9

Garbage Collection 3,334 5 3,334 5

Repairs & Maintenance 0 5,500 8

Security/Access Control 0 1,750 2

Administration/Management 0 16,500 23

55,992 78 89,742 124

Total OutgoingsTotal OutgoingsTotal OutgoingsTotal Outgoings 55,99255,99255,99255,992 78787878 89,74289,74289,74289,742 124124124124

Adopted

Net Income Summary

Net Income Estimate:

� Based on our interpretation of the current tenancy arrangements, the fully leased income of the property plus market income for vacancies is outlined below.

� Refer to Net Income Estimate section for our assessment of market rents and comments.

INCOME SUMMARY Lettable Area Contract Outgoings

sqm $pa $pa $pa $psm

Retail 60.0 60,000 0 60,000 1,000

Office 522.0 375,557 0 375,557 719

Monthly 48.0 48,540 0 48,540 1,011

GROSS RENTGROSS RENTGROSS RENTGROSS RENT 630.0630.0630.0630.0 484,097484,097484,097484,097 0000 484,097484,097484,097484,097 768768768768

GROSS INCOMEGROSS INCOMEGROSS INCOMEGROSS INCOME 484,097484,097484,097484,097 768768768768

Less

Statutory Expenses (Incl Land Tax) (36,294)

Operating Expenses (53,448)

Total Outgoings Expenses (89,742)

NET INCOME (After Adjustments)NET INCOME (After Adjustments)NET INCOME (After Adjustments)NET INCOME (After Adjustments) 394,355394,355394,355394,355 626626626626

Vacant Tenancies 92.0 87,450 951

Vacancy/Bad Debts Allowance 2.00% (10,768)

NET INCOMENET INCOMENET INCOMENET INCOME 722.0722.0722.0722.0 471,038471,038471,038471,038 652652652652

Gross Passing Rent

6 MARKET COMMENTARY

Local Market Commentary

Double Bay: � The retail/commercial market in Double Bay is currently characterised by stable owner occupied and investor demand for well-located and leased properties. Supply of trophy assets such as the subject is limited with corresponding demand originating from high net worth individuals residing in the eastern suburbs with generally low finance/credit requirements. The Double Bay precinct was previously a very strong retail and commercial centre but with the development of the Bondi Junction Westfield Shopping Centre much of the demand for Double Bay properties declined. The area still has strong fundamentals and enjoys a popular village centre atmosphere. Combined with some modern developments occurring within the suburb, demand is increasing. Retail leasing activity in Double Bay has increased in the past 6-12 months with a number of transactions occurring during the same period.

� The retail/commercial precinct comprises of a handful of popular retail streets which branch off New South Head Road, the main road that connects the eastern suburbs to the city. The shops comprise a mix of retail uses which differs from street to street. Bay Street comprises many restaurants and other retail uses. Knox Street is a mix of cafes/restaurants and high end fashion. Transvaal Avenue is a small cul-de-sac which is dominated by single storey terraces which were formerly utilised for residential purposes but now house a variety of retail uses with a heavy leaning towards fashion. The focal point of Transvaal Avenue is the corner of Cross Street and Transvaal Avenue where “Bar Indigo” is located. This is a popular café which incorporates alfresco dining in an informal and trendy atmosphere which attracts many local residents/workers.

� Double Bay is a harbour side suburb and derives its name from the two mini bays that border the harbour, each with a small beach. Between the bays is Double Bay Wharf which has a ferry stop which is offers regular services to and from Sydney Harbour. Double Bay is considered one of the more affluent suburbs of Sydney and the residential prices are some of the highest in the country.

Chester House (Chester House (Chester House (Chester House (Formerly)Formerly)Formerly)Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

7 FINANCIAL ANALYSIS

Rental Analysis

Overview: � We have had regard to recent leasing transactions in comparable buildings within the locality.

� We have included retail leasing evidence for the subject Shops 1 and 2 with commercial office leasing transactions for the remainder of commercial accommodation.

COMPS LEASING EVIDENCE - RETAIL

Property Tenant

Area

(sqm)

Rent

$psm Basis

Comm.

Date

Lease

Term Incentive

Rent

Reviews

Overall

Comparability

Shop 3/30-36 Bay Street George Haddad 78 $1,082 Gross Jul-11 5y+5y Undisclosed Undisclosed Inferior

Shops 4-5/30-36 Bay Street Higgovale 86 $935 Gross Dec-11 3y+3y Undisclosed Undisclosed Inferior

Double Bay

1/3 Knox Street Undisclosed 58 $1,086 Gross Jun-11 3y+3y 1 month CPI pa Comparable

Double Bay

Shops 1 and 2/19-27 Cross Street Bookshop 80 $1,375 Gross Jan-11 2y Undisclosed 4% pa Comparable

Shops 7 and 8/19-27 Cross Street Undisclosed 110 $818 Gross Mar-11 5y+5y 3 months CPI pa Comparable

Shop 9/19-27 Cross Street Undisclosed 45 $1,667 Gross Oct-11 3y+3y None 4% pa Comparable

Undisclosed/19-27 Cross Street Optometrist 110 $864 Gross Mar-11 5y+5y 4 months 4% pa Comparable

Double Bay

Shop 2/15 Cross Street The Oh Yes Shop 115 $913 Net Mar-11 5y+5y 4 months 4% pa Comparable

Double Bay

Shop 2/357 New South Head Road Undisclosed 59 $881 Net Nov-11 1y+3y None None Inferior

Double Bay

Comments: This is "Angela House", a modernised four storey commercial/retail building with ground floor retail and commercial accommodation to the

upper levels. The property benefits from a corner position to Bay Street and Guilfoyle Avenue. Larger lettable area compared to the subject retail

component on an individual shop basis. Superior exposure with two street frontages and being positioned at the street, slightly inferior regarded location

in Double Bay. Based on differing economies of scale, this would indicate an inferior rate per square metre of lettable area compared to the subject

shops. Rent equates to a range of $1,546 to $1,623 per week gross.

Comments: This is a ground floor shop within a two storey building with corner exposure to Knox Street, Goldman Lane and Knox Lane. Similar

lettable area compared to the subject retail component on an individual shop basis. Superior exposure. On the balance of all factors, we would expect

this to indicate a similar rate per square metre of lettable area compared to the larger subject shop. Rent equates to $1,211 per week gross.

Comments: This is a commercial building known as the "Double Bay Plaza" positioned on the corner of Cross Street and Transvaal Avenue. Leasing

activity relates to ground floor retail accommodation. Shop 9 is at Heads of Agreement stage. Shops 1 and 2 benefit from an approximate 8 metre

frontage to Cross Street. Shop 7 is set back from Cross Street with limited street exposure. Shop 8 benefits from good street exposure. Shop 9 is set

back from the Cross Street elevation, however, benefits from an approximate 10 metre frontage to Cross Street and Transvaal Avenue. Similar

location, superior exposure having the benefit of Cross Street and Transvaal Avenue frontages. Inferior condition of accommodation. Larger lettable

area compared to the subject on an individual shop basis. We would expect the subject retail component to demonstrate a similar rate per square

metre of lettable area in comparison to this property. Rent equates to a range of $1,442 to $2,115 per week gross.

Comments: This is a ground floor shop within "Chapel Court", a modern two storey mixed commercial/retail development which benefits from corner

exposure to Cross Street and Transvaal Avenue. Features include air conditioning and adjoining a Council car park. Formerly occupied by Cerrone

Jewellers. Benefits from an approximate 8 metre frontage to Cross Street and corner position to Transvaal Avenue. Outgoings are stated at $149 per

square metre. Larger lettable area compared to the subject retail component on an individual shop basis. Superior exposure having the benefit of

street frontages to Cross Street and Transvaal Avenue. On the balance of all factors, we would expect this to demonstrate a similar rate per square

metre of lettable area compared to the subject retail accommodation. Rent equates to $2,019 per week net.

Comments: This is a ground floor shop within a two storey commercial building benefitting from corner exposure to New South Head Road and

Manning Road. Outgoings equates to $6,000 per annum or $102 per square metre. Similar lettable area compared to the subject retail component

on an individual tenancy area basis. Inferior retail locale. Based on the inferior location, this would demonstrate an inferior rate per square metre of

lettable area in comparison to the subject retail space. Rent equates to $1,000 per week net.

COMPS LEASING EVIDENCE - OFFICE

Property Tenant

Area

(sqm)

Rent

$psm Basis

Comm.

Date

Lease

Term Incentive

Rent

Reviews

Overall

Comparability

104/30-36 Bay Street DJ Lemon 73 $520 Gross Mar-12 3y+3y Undisclosed Undisclosed Comparable

203/30-36 Bay Street Landes (Retail) 35 $457 Gross Jan-12 2y+2y Undisclosed Undisclosed Comparable

207/30-36 Bay Street Tactician Australia 46 $546 Gross Feb-12 1y+1y Undisclosed Undisclosed Comparable

307B/30-36 Bay Street Dr Johnson 20 $525 Gross Oct-11 5y+5y Undisclosed Undisclosed Comparable

Double Bay

Suite 4/434 New South Head Road Undisclosed 60 $450 Gross Feb-12 2y+1y 1 month 3.5% pa Inferior

Double Bay

18 Transvaal Avenue Undisclosed 164 $579 Net Jan-12 1y 6m None CPI pa Comparable

Double Bay

5/442 New South Head Road Undisclosed 92 $520 Gross Nov-11 3y+3y 3 months CPI pa Comparable

Double Bay

Comments: This is modern office accommodation on Level 2. Features include three offices benefitting from good levels of natural light. Similar

lettable area compared to the subject first floor suites. Superior parking amenity having the benefit of a single lock up garage. On the balance of all

factors, this would indicate a comparable rate per square metre of lettable area compared to the subject ground and first floor office space. Rent

equates to $920 per week gross.

Comments: This is a ground floor office/showroom with two offices, boardroom and open plan commercial accommodation. Positioned within an

inferior location on Transvaal Avenue. A sublease with 18 months remaining until end of term certain. Outgoings equates to $15,000 per annum or

$91 per square metre. Although a sublease, we believe this would indicate a similar rent to the subject ground floor office accommodation. Rent

equates to $1,827 per week net.

Comments: This is "Angela House", a modernised four storey commercial/retail building with ground floor retail and commercial accommodation to the

upper levels. The property benefits from corner position to Bay Street and Guilfoyle Avenue. Smaller lettable area compared to the subject ground and

first floor office suites, larger lettable area compared to the subject second level office suites. We would expect this to indicate a similar rate per square

metre of lettable area in comparison to the subject ground and first floor office space and an inferior rate per square metre of lettable area compared

to the subject second level accommodation based on differing economies of scale. Rent equates to a range of $202 to $730 per week gross.

Comments: This is a first floor office suite within a refurbished two storey commercial building. Positioned within an inferior commercial locale.

Inferior location. Similar lettable area compared to the subject ground and first floor office accommodation, larger lettable area in comparison to the

subject second floor space on an individual office suite basis. Based on the inferior location and condition of accommodation, this would demonstrate an

inferior rate per square metre of lettable area compared to the subject office accommodation. Rent equates to $519 per week gross.

Indicative Rates: � The retail evidence demonstrates a range of $818 to $1,667 psm gross with two transactions indicating a net range of $881 to $913 psm, depending upon the size, location and quality of the premises.

� The commercial office evidence above demonstrates a range of $450 to $546 psm gross with a single transaction indicating a net rate of $579 psm, depending upon the size, location and quality of the premises.

Chester HouChester HouChester HouChester House (Formerly)se (Formerly)se (Formerly)se (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

Most Comparable: � We consider the best evidence to be 19-27 Cross Street, Double Bay for the retail accommodation and 30-36 Bay Street, Double Bay for the commercial office space.

� 19-27 Cross Street, Double Bay is a retail development known as “Double Bay Plaza”. It is positioned within close proximity to the subject, however, has a superior exposure being positioned on the corner of Cross Street and Transvaal Avenue. Four shops ranging between 45 square metres and 110 square metres leased in 2011. This development is considered inferior in terms of condition of accommodation and is relatively larger in lettable area compared to the subject retail component on an individual shop basis. On the balance of all factors, we would expect this to demonstrate a similar rate per square metre of lettable area compared to the subject shops. The four shops mentioned leased in 2011 demonstrating a gross rate range of $818 to $1,667 per square metre.

� 30-36 Bay Street, Double Bay is a modernised four storey commercial/retail development known as “Angela House”. Four office suites leased in 2011-2012 ranging between 20 square metres and 73 square metres. We would expect this to indicate a similar rate per square metre of lettable area compared to the subject ground and first floor commercial accommodation, and an inferior rate per square metre of lettable area in comparison to the subject second floor space based on differing economies of scale. The four office suites mentioned leased in 2011-2012 indicating a gross rate range of $457 to $546 per square metre.

� After consideration of all factors, we have adopted a gross rate range for the ground floor shops of $1,000 to $1,350 per square metre, $575 to $600 per square metre for the ground/first floor commercial space and $600 to $1,200 per square metre for the Level 2 office suites.

� We have selected a rental rate range at the upper end of the ranges for the ground floor shops based on the modern accommodation and relatively small lettable area.

� We have selected a rental rate range for the ground and first floor office space at the upper end of the ranges based on good natural light provision and modern standard of accommodation.

� We have selected a rental rate range above the ranges for the Level 2 office accommodation based on the large common areas, modern standard of accommodation and relatively small lettable areas. The majority of suites on Level 2 are below 20 square metres and would be viewed primarily by the leasing market on a gross rate per week basis. The selected gross rates for Level 2 equate to a weekly rate range of $185 to $571 gross for each of the office suites.

Rental Assessment

LEASE RENTAL ANALYSIS

No. of Lettable Area Contract Outgoings Gross Rent

Tenancies (sqm) $pa $pa $pa $psm

Retail 1 60.0 60,000 0 60,000 1,000

Office 9 522.0 375,557 0 375,557 719

Sub-Total 10 582.0 435,557 0 435,557 748

Monthly 4 48.0 48,540 0 48,540 1,011

Vacant 2 92.0 0 0 - -

TotalTotalTotalTotal 16161616 722.0722.0722.0722.0 484,097484,097484,097484,097 0000 484,097484,097484,097484,097 670670670670

Net Income Estimate

Net Income Estimate:

� Based on our interpretation of the tenancy arrangements, the subject property’s estimated income (passing and market) is:

INCOME SUMMARY Lettable Area Contract Outgoings

sqm $pa $pa $pa $psm $pa $psm

Retail 60.0 60,000 0 60,000 1,000 60,000 1,000

Office 522.0 375,557 0 375,557 719 336,925 645

Monthly 48.0 48,540 0 48,540 1,011 0 0

GROSS RENTGROSS RENTGROSS RENTGROSS RENT 630.0630.0630.0630.0 484,097484,097484,097484,097 0000 484,097484,097484,097484,097 768768768768 450,925450,925450,925450,925 716716716716

GROSS INCOMEGROSS INCOMEGROSS INCOMEGROSS INCOME 484,097484,097484,097484,097 768768768768 450,925450,925450,925450,925 716716716716

Less

Statutory Expenses (Incl Land Tax) (36,294) (36,294)

Operating Expenses (53,448) (53,448)

Total Outgoings Expenses (89,742) (89,742) (142)

NET INCOME (After Adjustments)NET INCOME (After Adjustments)NET INCOME (After Adjustments)NET INCOME (After Adjustments) 394,355394,355394,355394,355 626626626626 361,183361,183361,183361,183 573573573573

Vacant Tenancies 92.0 87,450 951 87,450 951

Vacancy/Bad Debts Allowance 2.00% (10,768) (10,768)

NET INCOMENET INCOMENET INCOMENET INCOME 722.0722.0722.0722.0 471,038471,038471,038471,038 652652652652 437,866437,866437,866437,866 606606606606

Gross Market RentGross Passing Rent

Loca l

80%

Monthl y

7% Va ca nt

13%

Tenant Type Profile By Area

Loca l

90%

Monthl y

10% Va ca nt

Tenant Type Profile By Income

Comments: � The passing rental is considered above market, therefore $43,511 of the property’s value is attributable to profit rent. It is important to note that the profit rent will continue to diminish until such leases expire, resulting in the value of the asset declining by the amount of profit rent during this timeframe, all things being equal.

ChesterChesterChesterChester House (Formerly)House (Formerly)House (Formerly)House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

8 SALES EVIDENCE

Sales Evidence

Overview: � We have had regard to recent investment transactions within the locality.

� Same are summarised below:

COMPS SALES EVIDENCE - RETAIL/COMMERCIAL

Property

Sale

Date

Sale

Price

Land

Area

(sqm)

Total

Lettable

Area

Net

Income

(PA)

Initial

Yield

$psm

Land

$psm

Lettable

Area

Overall

Comparability

29-33 Bay Street Apr-12 $5,100,000 455 613 $271,423 5.32% $11,209 $8,320 Inferior

Double Bay

84 Queen Street Jun-11 $4,250,000 201 320 VP VP $21,144 $13,281 Superior

Woollahra

28-30 Bayswater Road Jun-11 $4,440,000 450 782 $360,000 8.11% $9,867 $5,678 Inferior

Potts Point

113-115 Oxford Street Mar-11 $8,850,000 468 1,755 $393,743 4.45% $18,910 $5,043 Inferior

Darlinghurst

9-11 Knox Street Oct-11 $7,775,000 474 783 $239,923 3.09% $16,403 $9,930 Superior

Double Bay

Comments: This is a circa 1930's, heritage-listed, five storey commercial building incorporating 6 retail and 10 office tenancy areas (some of

which have been combined to form single tenancy areas). The property benefits from a prominent corner position with frontages to Oxford

Street, Crown Street and Arnold Place. The top two levels were constructed circa 1960's. The property was partially refurbished in the past 10

years. Parking for approximately 12 vehicles is provided in the basement car park. Apart from five vacant carspaces, the property was fully

leased albeit below current market levels. Equivalent yield of 7.96% and a WALE of 0.75 years. Larger land and lettable area. Significantly

higher lettable area to land area ratio. Inferior condition of accommodation and location. Inferior WALE. On the balance of all factors, this

would indicate an inferior rate per square metre of lettable area compared to the subject. As this was significantly underrented at the time of

sale, we would expect the subject to demonstrate an inferior yield to that indicated by this sale.

Comments: This is a two storey modernised commercial/retail building with ground floor shops and first floor office accommodation.

Comprises two shops and six office suites fully leased and anchored by an ANZ Bank. Selling agent indicated that the property was leased over

current market levels due to historic rental increases. At the time of sale, 17.0% of the property was vacant, the WALE was 1.37 years with the

reversionary and equivalent net yield being 6.18% and 5.87% respectively. Retail component comprises approximately 52% of the total lettable

area. Positioned in a slightly inferior retail position compared to the subject. Slightly larger land area, larger lettable area. Slightly lower

lettable area to land area ratio. Based on the lower lettable area to land area ratio, this would demonstrate a superior rate per square metre of

lettable area compared to the subject. As this had a significant level of vacancy, we would expect this property to demonstrate a superior yield

compared to the subject.

Comments: This is a two storey retail building with ground floor retail and first floor commercial accommodation. The ground floor comprises a

single tenancy to Lemoncello Restaurant. Same features a balcony to Bay Street, fronting dining area, bar, rear dining area, rear courtyard,

own amenities, commercial kitchen, garage and basement storage area. 123 square metres of external balcony/courtyard area has not been

included in the lettable area. The first floor comprises three commercial tenancies including Skin Haven, Joseph Morad Hair and Beauty as well

as Fame Fashion. Sold fully leased with a Weighted Average Lease Expiry (WALE) of 1.62 years. Sold underrented with the reversionary and

equivalent net yield being 5.92% and 6.07% respectively. Retail component comprises approximately 57% of the total lettable area. Similar

land area, smaller lettable area. Lower lettable area to land area ratio. Similar condition of accommodation. Higher proportion of ground

floor retail accommodation. Inferior regarded retail locale. Based on the inferior location within Double Bay, this would demonstrate an inferior

rate per square metre of lettable area compared to the subject. As this was significantly underrented at the time of sale, we would expect this to

indicate a superior yield to the subject.

Comments: This is a modernised two storey retail building with a ground floor shop and first floor office. Positioned within the heart of the

Woollahra retail precinct. Includes onsite parking for two cars. Sold subject to vacant possession. Smaller land and lettable area. Lower

lettable area to land area ratio. Similar condition of accommodation. A similar-regarded retail locale. Based on differing economies of scale,

this would indicate a superior rate per square metre of lettable area in comparison to the subject.

Comments: This is a modernised four level commercial building comprising retail and office accommodation fully leased to 11 tenants. The

ground floor retail space of 365 square metres is leased to one tenant, while the office accommodation of 417 square metres is leased to 10

tenants. The property benefits from an approximate 15 metre frontage to Bayswater Road, onsite parking amenity for three cars and rear lane

access from Mansions Lane. The ground floor component includes a restaurant licence. Features include polished concrete and timber floors

and split system air conditioning units. Benefits from good levels of natural light. WALE of 3.14 years. Retail component comprises

approximately 47% of the total lettable area. Similar land area, slightly larger lettable area. Similar lettable area to land area ratio. Inferior

location. Superior WALE. Based on the inferior location, this would demonstrate an inferior rate per square metre of lettable area in

comparison to the subject. Although having a superior WALE, we would not expect this to indicate a superior yield to that indicated by the

subject.

Indicative Rates: � The sales analysis indicates:

− Initial net yields of 3.09% to 8.11%.

− Equivalent and reversionary net yields of 5.87% to 7.96%.

− A capital value rate comparison of $5,043 to $13,281 psm of Lettable Area.

Evidence Comment:

� These sales demonstrate investment and owner occupant activity during the last 12-18 months. Not all of the sales are considered to be directly comparable, however, they do provide a range of evidence and set the parameters upon which we have based our assessment of value of the subject property.

Key Comparability Issues:

� We have particularly taken note of the following:

− Vacancy levels.

− WALE by income and by area.

− Condition of accommodation.

− Location.

− Size.

Key Evidence: � We have particularly taken into account the following sales and provide comparability comments as follows:

− 29-33 Bay Street, Double Bay: This is a two storey retail building with ground floor retail and first floor commercial accommodation. It has a land area of 455 square metres and a lettable area of 613 square metres. It was sold fully leased with a WALE of 1.62 years. It was sold under-rented equating to a reversionary and net equivalent yield of 5.92% and 6.07% respectively. Based on the inferior position within Double Bay, this would demonstrate an inferior rate per square metre of lettable area in comparison to the subject. As this was significantly underrented at the time of sale, this would indicate a superior yield compared to the subject. This sold in April 2012 for $5,100,000 which equated to a rate per square metre of lettable area of $8,320 and an initial net yield of 5.32%.

− 9-11 Knox Street, Double Bay: This is a two storey modernised commercial/retail building with ground floor shops and first floor office accommodation. It has a land area of 474 square metres and 783 square metres of lettable area. At the time of sale, 17.0% of the property was vacant, the WALE was 1.37 years. The reversionary and equivalent net yield equated to 6.18% and 5.87% respectively. Based on the lower lettable area to land area ratio, we would expect this to demonstrate a superior rate per square metre of lettable area in comparison to the subject. As the property had significant vacancy at the time of sale, we would expect this to indicate a superior yield to that of the subject. This sold in October 2011 for $7,775,000 which equated to a rate per square metre of lettable area of $9,930 and an initial net yield of 3.09%.

Concluded Investment Parameters

Rates Adopted: � Having regard to the property’s location, legal, physical, and cash flow attributes relative to the evidence above, we have adopted the following investment parameters:

− Capitalisation Rate: 6.25%

− Capital Value Rate Range $psm of Lettable Area: $9,600 to $9,700

CheCheCheChester House (Formerly)ster House (Formerly)ster House (Formerly)ster House (Formerly) 1111 Transvaal AvenueTransvaal AvenueTransvaal AvenueTransvaal Avenue Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028Double Bay NSW 2028

9 VALUATION RATIONALE

Introduction

Overview: � In arriving at our opinion of value, we have considered relevant general and economic factors and in particular have investigated recent sales and leasing transactions of comparable properties (as previously detailed).

Valuation Approaches:

� Capitalisation Analysis.

� Direct Comparison Approach.

Valuation Analyses:

CBRE employs industry recognised valuation methodologies in estimating the value of a CBRE employs industry recognised valuation methodologies in estimating the value of a CBRE employs industry recognised valuation methodologies in estimating the value of a CBRE employs industry recognised valuation methodologies in estimating the value of a property, having regard to the definition of market value and market based evidence. property, having regard to the definition of market value and market based evidence. property, having regard to the definition of market value and market based evidence. property, having regard to the definition of market value and market based evidence. The The The The result is the best estimate of value result is the best estimate of value result is the best estimate of value result is the best estimate of value CBRECBRECBRECBRE can produce, but it is an estimate and not a can produce, but it is an estimate and not a can produce, but it is an estimate and not a can produce, but it is an estimate and not a guaranteeguaranteeguaranteeguarantee,,,, and it is fully dependent upon the accuracy of the assumptions as to income, and it is fully dependent upon the accuracy of the assumptions as to income, and it is fully dependent upon the accuracy of the assumptions as to income, and it is fully dependent upon the accuracy of the assumptions as to income, expenseexpenseexpenseexpenses,s,s,s, and market conditions.and market conditions.and market conditions.and market conditions. These valuation methodologies These valuation methodologies These valuation methodologies These valuation methodologies use market derived use market derived use market derived use market derived assumassumassumassumptions (including rents andptions (including rents andptions (including rents andptions (including rents and yieldsyieldsyieldsyields) obtain) obtain) obtain) obtained from analysed transactions.ed from analysed transactions.ed from analysed transactions.ed from analysed transactions.

WeWeWeWe have not independently verified have not independently verified have not independently verified have not independently verified marketmarketmarketmarket information, nor adopted it as our owninformation, nor adopted it as our owninformation, nor adopted it as our owninformation, nor adopted it as our own, n, n, n, nor or or or can can can can we comment on or we comment on or we comment on or we comment on or accept its reliability. The Reliant Party accepts the risk that if any of the accept its reliability. The Reliant Party accepts the risk that if any of the accept its reliability. The Reliant Party accepts the risk that if any of the accept its reliability. The Reliant Party accepts the risk that if any of the unverified information/advice punverified information/advice punverified information/advice punverified information/advice provided by others and referred to in rovided by others and referred to in rovided by others and referred to in rovided by others and referred to in ourourourour valuation is incorrect, valuation is incorrect, valuation is incorrect, valuation is incorrect, then this may have an effect on the valuationthen this may have an effect on the valuationthen this may have an effect on the valuationthen this may have an effect on the valuation. (Refer to Information Supplied by Others.). (Refer to Information Supplied by Others.). (Refer to Information Supplied by Others.). (Refer to Information Supplied by Others.)

Capitalisation Analysis

Capitalisation Analysis:

� The estimated total income (on both a passing rental and face market rental basis) has been adjusted to reflect anticipated operating costs and potential future income from existing vacancies to produce a net income on a fully leased basis.

� The adopted fully leased net income has been capitalised in perpetuity from the valuation date at a capitalisation rate of 6.25%, which we feel reflects the nature, location, and tenancy profile of the property when compared with current market investment criteria.

� We have then made various capital adjustments to the calculated core value, including:

− Allowances for existing vacancies.

− An allowance of $12,500 for capital expenditure to install partition walls for Suite 12 on Level 2.

� Our assessment includes an element of profit rent. That is, current rentals which are above market that will revert to market levels when leases expire or market reviews are affected. It is important to note that the profit rent will continually diminish until such leases expire resulting in the value of the asset declining by the amount of the profit rent during this timeframe, all other things being equal.

� We have also deducted an allowance for the anticipated future letting-up expenses and associated capital expenditure over a 1 year period. This is not merely an arbitrary period, but a consistent approach that we take for the majority of properties that we value and sales which we analyse. We believe it is also appropriate given the adoption of a face rent profile (rather than effective rents) and accounts for the difference between buildings let under longer leases, and those with imminent expiries.

� Our capitalisation analysis calculations are detailed overleaf.

CAPITALISATION ANALYSIS Area Contract Rent Market Rent

Gross Rent IncomeGross Rent IncomeGross Rent IncomeGross Rent Income Retail 60.0 60,000 60,000

Office 522.0 375,557 336,925 Monthly 48.0 48,540 54,000

630.0630.0630.0630.0 484,097484,097484,097484,097 450,925450,925450,925450,925

GROSS INCOMEGROSS INCOMEGROSS INCOMEGROSS INCOME 484,097484,097484,097484,097 450,925450,925450,925450,925

OutgoingsOutgoingsOutgoingsOutgoings Statutory Expenses (Incl Land Tax) (36,294) (36,294)

Operating Expenses (53,448) (53,448)

Total Outgoings (89,742) (89,742)

NET INCOME (before vacancies and adjustments)NET INCOME (before vacancies and adjustments)NET INCOME (before vacancies and adjustments)NET INCOME (before vacancies and adjustments) 394,355394,355394,355394,355 361,183361,183361,183361,183

Income AdjustmentsIncome AdjustmentsIncome AdjustmentsIncome Adjustments Potential Future Income - Vacant Tenancies 92.0 87,450 87,450

Vacancy/Bad Debts Allowance 2.00% (10,768) (10,768)

Total Income Adjustments 76,683 76,683

FULLY LEASED NET INCOME (after vacancy allowance)FULLY LEASED NET INCOME (after vacancy allowance)FULLY LEASED NET INCOME (after vacancy allowance)FULLY LEASED NET INCOME (after vacancy allowance) 471,038471,038471,038471,038 437,866437,866437,866437,866

CAPITALISED VALUECAPITALISED VALUECAPITALISED VALUECAPITALISED VALUE Capitalised In Perpetuity @ 6.25% 6.25%

7,536,6047,536,6047,536,6047,536,604 7,005,8527,005,8527,005,8527,005,852 Capital AdjustmentsCapital AdjustmentsCapital AdjustmentsCapital Adjustments

VacanciesVacanciesVacanciesVacancies Letting Up Allowance (29,150) (29,150)

Leasing Commissions (10,494) (10,494)

Incentive Allowance (21,863) (21,863)

Rent AdjustmentsRent AdjustmentsRent AdjustmentsRent Adjustments P.V. of Capitalised Rental Reversions 12 mths (480,051) -

P.V. of Overage/Underage Rental - 50,701

Impending ExpiriesImpending ExpiriesImpending ExpiriesImpending Expiries P.V. of Future Letting Up Allowances 1 years (22,637) (22,637)

P.V. of Future Leasing Commissions 1 years (12,224) (12,224)

P.V. of Future Incentive Allowances 1 years (33,955) (33,955)

Capital WorksCapital WorksCapital WorksCapital Works Less Suite 12 Partitions (12,500) (12,500)

Total Capital Adjustments (623,030) (92,278)

Sensitivity AnalysisSensitivity AnalysisSensitivity AnalysisSensitivity Analysis 6,913,574 6,913,574 6.00% $7,250,000

6.25% $6,900,000 AdoptAdoptAdoptAdopt $6,900,000$6,900,000$6,900,000$6,900,000 $6,900,000$6,900,000$6,900,000$6,900,000

6.50% $6,600,000

Direct Comparison Approach

Methodology: � The market evidence detailed earlier has been compared with the subject property. We have analysed the sales evidence on a rate per square metre of lettable area basis, and have considered the nature and condition of each property, location, and tenancy profile.

� Our direct comparison analysis is summarised below.

� We have made an allowance of $12,500 for capital expenditure to install partition walls for Suite 12 on Level 2.

DIRECT COMPARISON APPROACH

Lettable Area 722.0 sqm

Rate $psm Calculated Value 9,600 6,931,200

9,650 6,967,300

9,700 7,003,400

AdoptAdoptAdoptAdopt 6,967,3006,967,3006,967,3006,967,300

Rate $psm 9,650

Less Suite 12 Partitions -12,500

ADOPTADOPTADOPTADOPT 6,950,0006,950,0006,950,0006,950,000

Rate $psm 9,626

Valuation Summary

Reconciliation: � We have reconciled the value as follows:

SUMMARY OF VALUES

Capitalisation Analysis $6,900,000

Direct Comparison Approach $6,950,000

Adopted for Valuation PurposesAdopted for Valuation PurposesAdopted for Valuation PurposesAdopted for Valuation Purposes $6,925,000$6,925,000$6,925,000$6,925,000

Initial Yield 5.69%

Initial Yield (Fully Leased) 6.80%

Reversionary (Market) Yield 6.32%

Value $psm less Suite 12 Partitions $9,591

Treatment of GST

Treatment of GST:

� Our valuation is expressed exclusive of GST. It is our interpretation of the tax provisions that the freehold going concern would be treated as such and consequently no liability for GST would exist.

We We We We have have have have not been provided with legal advice regarding this matter, and have based our not been provided with legal advice regarding this matter, and have based our not been provided with legal advice regarding this matter, and have based our not been provided with legal advice regarding this matter, and have based our analysanalysanalysanalysis upon our current understanding of the legislationis upon our current understanding of the legislationis upon our current understanding of the legislationis upon our current understanding of the legislation. The Reliant Party. The Reliant Party. The Reliant Party. The Reliant Party should make should make should make should make appropriate enquiries in this respectappropriate enquiries in this respectappropriate enquiries in this respectappropriate enquiries in this respect, and if , and if , and if , and if any of theany of theany of theany of thesesesese assumptions prove to be incorrect, assumptions prove to be incorrect, assumptions prove to be incorrect, assumptions prove to be incorrect, ththththis is is is valuationvaluationvaluationvaluation must not be relied upon before first consulting must not be relied upon before first consulting must not be relied upon before first consulting must not be relied upon before first consulting CBRECBRECBRECBRE to reasseto reasseto reasseto reassess any effect on ss any effect on ss any effect on ss any effect on the valuationthe valuationthe valuationthe valuation....

10 ADDITIONAL REPORTING REQUIREMENTS

Methodology:

� We have been requested to provide an estimated replacement cost for insurance purposes.

� We have assumed the property is damaged or destroyed to an extent that requires the total demolition of the building upon the final day of currency of the relevant insurance policy.

� In order to replace the building, any remaining structure would be cleared from the site prior to re-construction. We have included elements of inflation, firstly over the period of the insurance policy and secondly over the re-construction period. We have based our replacement cost estimate on the assumption that the site is free of asbestos or other hazardous contamination. We have not made allowances for loss of rental and recovery of statutory outgoings incurred during the re-construction period.

Insurance Replacement Cost Estimate:

� Based upon the construction of a building of modern design to replace the current gross floor area of the existing premises, we estimate the replacement cost to be in the vicinity of $2,400,000 (Two Million, Four Hundred Thousand Dollars) exclusive of GST.

Context of Estimate:

We are not quantity surveyors and our estimate of the construction cost is We are not quantity surveyors and our estimate of the construction cost is We are not quantity surveyors and our estimate of the construction cost is We are not quantity surveyors and our estimate of the construction cost is based upon based upon based upon based upon authoriauthoriauthoriauthoritative published sources including Rawlinsons Construction Handbook 2012. We tative published sources including Rawlinsons Construction Handbook 2012. We tative published sources including Rawlinsons Construction Handbook 2012. We tative published sources including Rawlinsons Construction Handbook 2012. We recommend that verification of the insurance replacement cost noted above be soughtrecommend that verification of the insurance replacement cost noted above be soughtrecommend that verification of the insurance replacement cost noted above be soughtrecommend that verification of the insurance replacement cost noted above be sought from from from from a qualified quantity surveyor if considered appropriate.a qualified quantity surveyor if considered appropriate.a qualified quantity surveyor if considered appropriate.a qualified quantity surveyor if considered appropriate.

11 QUALIFICATIONS

The report must be read in accordance with and subject to the following qualifications:

Valuation subject to

change

Values vary from time to time in response to changing market circumstances. The valuation is based

on available information as at the date of valuation. No warranty can be given as to the

maintenance of this value into the future. Therefore, it should be reviewed periodically.

Extent of

investigations

We are not engaged to carry out all possible investigations in relation to the property. Where in our

report we identify certain limitations to our investigations, this is to enable the Reliant Party to instruct

further investigations where considered appropriate or where we recommend as necessary prior to

Reliance. CBRE is not liable for any loss occasioned by a decision not to conduct further

investigations.

Assumptions Assumptions are a necessary part of undertaking valuations. CBRE adopts assumptions for the

purpose of providing valuation advice because some matters are not capable of accurate calculation

or fall outside the scope of our expertise, or our instructions. The Reliant Party accepts that the

valuation contains certain specific assumptions, and acknowledges and accepts the risk that if any of

the assumptions adopted in the valuation are incorrect, then this may have an effect on the valuation.

Information supplied

by others

The valuation contains information which is derived from other sources. Unless otherwise specifically

instructed by you and/or stated in the valuation, we have not independently verified that information,

nor adopted it as our own, or accepted its reliability. The Reliant Party accepts the risk that if any of

the unverified information/advice provided by others and referred to in the valuation is incorrect, then

this may have an effect on the valuation.

Future matters To the extent that the valuation includes any statement as to a future matter, that statement is provided

as an estimate and/or opinion based on the information known to CBRE at the date of this document.

CBRE does not warrant that such statements are accurate or correct.

12 CONTACT DETAILS

Valuer: � Tony Mangioni

Associate Director - Valuation & Advisory Services

T +61 2 9289 3334 M +61 419 353 575 E [email protected]

Office: � CBRE Valuations Pty Limited ABN 15 008 912 641 Unit 8A 11 Lord Street Botany NSW 2019 T 61 2 9289 3333 F 61 2 9289 3330 www.cbre.com.au

A COPY OF LETTER OF ENGAGEMENT

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B VALUATION TERMINOLOGY & DEFINITIONS

TERMINOLOGY DEFINITION V.1104

Net Income Estimate, Net Income Estimate, Net Income Estimate, Net Income Estimate, Fully LeasedFully LeasedFully LeasedFully Leased

The total current net income plus the estimated income from vacant tenancies. The total current net income is the sum of the current base rent, outgoings recoveries and sundry income, less total outgoings expenses (including non-recoverable expenses).

Net PaNet PaNet PaNet Passing Incomessing Incomessing Incomessing Income The sum of the current base rent, outgoings recoveries and sundry income, less total outgoings expenses (including non-recoverable expenses), i.e. the current net income.

Outstanding Tenant Outstanding Tenant Outstanding Tenant Outstanding Tenant IncentivesIncentivesIncentivesIncentives

The total cost of all outstanding tenant incentives including unexpired rent free periods, outstanding fitout or cash contributions and rental discounts.

Initial YieldInitial YieldInitial YieldInitial Yield The net passing income (as defined above) as a percentage of the assessed value less the value of any excess land.

ReversionaryReversionaryReversionaryReversionary YieldYieldYieldYield The gross market income plus sundry income less total outgoings (including non-recoverable expenses), as a percentage of assessed value less the value of any excess land.

Adopted Adopted Adopted Adopted Capitalisation Rate Capitalisation Rate Capitalisation Rate Capitalisation Rate (or Equivalent Yield)(or Equivalent Yield)(or Equivalent Yield)(or Equivalent Yield)

The capitalisation rate applied to the net income estimate fully leased (as defined above). The term equivalent yield (as utilised within our analysis of comparable sales) essentially reflects a derived capitalisation rate based on the analysed purchase price.

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LAND AND PROPERTY INFORMATION NEW SOUTH WALES - TITLE SEARCH ------------------------------------------------------------ FOLIO: 1/580401 ------ SEARCH DATE TIME EDITION NO DATE ----------- ---- ---------- ---- 29/8/2012 4:29 PM 40 8/5/2012 LAND ---- LOT 1 IN DEPOSITED PLAN 580401 AT DOUBLE BAY LOCAL GOVERNMENT AREA WOOLLAHRA PARISH OF ALEXANDRIA COUNTY OF CUMBERLAND TITLE DIAGRAM DP580401 FIRST SCHEDULE -------------- TRANSVAAL INVESTMENTS PTY LIMITED (T 8218744) SECOND SCHEDULE (9 NOTIFICATIONS) --------------- 1 RESERVATIONS AND CONDITIONS IN THE CROWN GRANT(S) 2 BK 710 NO 330 EASEMENT AFFECTING THE PART OF THE LAND WITHIN DESCRIBED 1.22 METRES WIDE IN DP580401 3 8218745 MORTGAGE TO ST. GEORGE BANK LIMITED 4 AE462391 LEASE TO CHAGALL INTERNATIONAL PTY LIMITED OF SHOP 1, 1 TRANSVAAL AVENUE, DOUBLE BAY. EXPIRES: 31/1/2011. OPTION OF RENEWAL: THREE YEARS. 5 AE462392 LEASE TO CHESTER CAPITAL PTY LIMITED OF SUITE 3, GROUND FLOOR, 1 TRANSVAAL AVENUE, DOUBLE BAY. EXPIRES: 31/3/2011. OPTION OF RENEWAL: THREE YEARS. 6 AE462393 LEASE TO NICOLE TERKASHER OF SUITE 1, LEVEL 1, 1 TRANSVAAL AVENUE, DOUBLE BAY. EXPIRES: 20/7/2011. OPTION OF RENEWAL: THREE YEARS. 7 AF27485 LEASE TO METRO COMMERCIAL PARTNERS PTY LTD OF SUITE 4, FIRST FLOOR, 1 TRANSVAAL AVE, DOUBLE BAY. EXPIRES: 31/1/2011. OPTION OF RENEWAL: 3 YEARS. 8 AF477877 LEASE TO REBECCA LUCY MULLANEY-VEITCH OF SHOP 2, 1 TRANSVAAL AVENUE, DOUBLE BAY. EXPIRES: 31/8/2012. OPTION OF RENEWAL: 3 YEARS. 9 AG970134 THIS EDITION ISSUED PURSUANT TO S.111 REAL PROPERTY ACT, 1900 NOTATIONS --------- UNREGISTERED DEALINGS: NIL

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