Good direct investment results in the first quarter for Corio

Corio achieved good financial results in the first quarter of 2004. The direct investment result increased in the first quarter 2004 by € 3.7 million to € 47.7 million (+ 8,3%). Net rental income increased by 2.5% to € 66.1 million compared to the same period in 2003.

Change in Dutch Guidelines
As a result of changes in Dutch accounting principles regarding the definition of the result, both realised and unrealised revaluation of investments will be accounted for in the profit and loss account as from 1 January 2004.

In de the first quarter the direct investment result per share increased by 8.3% to € 0.72 compared to € 0.66 in the first quarter of 2003. The increase of the direct investment result is mainly due to rent increases, decreasing interest expenses and lower administrative expenses. The average financial occupancy rate decreased slightly to 94.4% (2003: 95.5%). The indirect investment result came to € 2.7 million negative (2003: € 4.0 million positive); this comprises of a € 0.5 million book profit1 (2003: € 5.5 million revaluation of 25% of the portfolio (including book profit)), from which the allocated administration costs of € 1.6 million (2003: € 1.9 million), an addition to deferred tax provision of € 1.2 million (2003: reduction of the deferred tax provision € 0.4 million) and other changes of € 0.4 million (2003: nil) are deducted. As a result of a change in Corio’s taxation policy in 2003, no revaluations took place in the first quarter of 2004; the full portfolio will be revaluated on 30 June and 31 December of each year.

In the first quarter of 2004 property to an amount of € 69.0 million has been sold. Investments amounted to € 5.8 million; this mainly concerns investment in the existing portfolio. The value of the property portfolio therefore decreased by € 62.7 million to € 3,746.0 million. In January Corio sold its last Spanish office property ‘Mar de Cristal’ for € 52.1 million. A shopping centre in The Netherlands (Zoetermeer: € 8.4 million) and a shopping centre in France (‘Transatlantic’ in Cherbourg: € 8.6 million) have been sold. In the first quarter of 2004 the average financial occupancy rate was 94.4% (2003: 95.5%) for the full portfolio; for retail, office and industrial properties this came to 96.7%, 88.4% en 93.5% respectively. The retail share of the portfolio amounted to 72% as per 31 March 2004 (2003: 70%).

Financial Position
Shareholders’ equity increased by € 45.0 million to € 2,274.3 million. As of 31 March 2004, the net asset value per share before profit appropriation (dividend 2003: € 2.32) came to € 34.33 (year end 2003: € 33.65). Leverage (borrowing as a percentage of total assets) amounted to 36.3% as of 31 March 2004 (year end 2003: 37.9%).

Financial Resources
Cost of capital decreased by € 2.4 million to € 14.1 (-14.1%). This decrease is the result of the following factors (compared to the same period of last year): Corio decreased its borrowing; loans with variable interest (against a lower rate) increased and short-term interest rates decreased.

Through active hands-on management, including extending the current property portfolio, Corio aims to achieve a growth in direct investment result that is at least in line with inflation in the euro zone. It is also regarded as important that the direct investment result does not fluctuate excessively year-on-year. The time horizon of the strategy emphasizes generation of the desired results over a rolling period of 3 to 5 years. Corio expects to achieve this goal by concentrating on retail investments, maintaining the existing and making selective new investments in industrial properties in the economic regions where Corio already has a retail presence

The total pipeline of potential committed projects (nearly only shopping centres) amounts at 31 March 2004 to € 570 miljoen (year end: € 569 million), spread over the coming five year. Based on the current balanc

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