CASE STUDY

Acquisition of 25.0% interest in Shopping Santa rsula

Case Study MULT3

Acquisition of 25.0% interest in Shopping Santa rsula Increasing interest in a recently renovated shopping center On November 8, 2010, Multiplan announced that it acquired an additional 25.0% stake in Shopping Santa rsula, in Ribeiro Preto, countryside of So Paulo, for R$45.0 million. This acquisition increased Multiplans interest to 62.5% in the shopping center, which just completed a renovation project and is concluding its tenant mix change. These improvements required a CAPEX of R$15.0 million which was invested by the Company and its partners turning Shopping Santa rsula into a modern shopping center with a new and improved mix. To conclude this significant change, needed to the Company its
90.0% 87.7%
85.0% 80.0% 75.0% 87.1%

Tenant exit for renovation

Tenant mix improvement

rearrange

70.0%
65.0% 60.0%
Nov-08

65.6%

tenant mix, bringing it down to an occupancy rate of 65.6%. In September 2010, this rate had gone back up to 87.1%. The Company expects this

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Shopping Santa rsulas monthly occupancy rate since the Companys first 37.5% stake acquisition

figure to further increase throughout the following months, given the improvements made to the mall combined with the growth of the city. The shopping is located in one of the most densely populated neighborhoods of Ribeiro Preto, composed essentially of A and B classes. Its premium location puts the shopping within the range of over 240 thousand potential consumers in a 10 minute radius. The city has 570 thousand inhabitants*, while the region (200km radius) has over 6 million. The area is quite wealthy given that it is the largest sugar cane producing region of the world* and dominates 10% of the agricultural sector of the country.
* Source: ACIRP official guide.

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Case Study MULT3

Santa rsula location in the center of Ribeiro Preto

A region and a shopping center with a strong growth potential The location further benefits from the fact that it is only 3.5km distant from Ribeiro Shopping, another Multiplan managed and owned mall. This allows management to handle both businesses thus generating synergies. While Ribeiro Shopping is a regional, democratic and consolidate mall, Santa rsula is just concluding its renovation and being reborn as an A and B modern neighborhood mall. The shopping has already shown improvements by narrowing the large spread between its rental revenue/m and that of Ribeiro Shopping. While these figures for rent per m are three times bigger at Ribeiro Shopping in 3Q10, sales/m at this shopping are only twice as high as those of Santa rsula, showing strong potential for increases in sales and especially in rent growth. Given these differences, the chart below attempts to project how the NOI the shopping could deliver if its performance converges to that of Ribeiro Shopping or the Companys portfolio. The Company believes that the shopping has strong growth potential and could lead to high returns for the Company after its renovation and tenant mix change.
2

R$ 2.500,00 R$ 2.000,00

R$ 2.209,74

R$ 2.354,37

R$ 2.400,27

R$ 600,00

RBS
118% 97%
R$ 500,00

Sales/m R$ 1.500,00
R$ 1.000,00 R$ 500,00 R$ R$ (500,00)

148%

SSU R$ 400,00
R$ 1.082,41 R$ 891,32 R$ 1.215,62 R$ 300,00 R$ 187,29 R$ 191,45

R$ 184,29

RBS
324% 258%

R$ 200,00

202%
R$ 100,00

R$ (1.000,00)

Rent/m

SSU
R$ 43,48 R$ 52,34 R$ 63,41 R$ -

R$ (1.500,00)

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Performance spread between Shopping Santa rsula and Ribeiro Shopping

Case Study MULT3

30,0 M
25,1 M

25,0 M
20,0 M 15,0 M

NOI 100%
Cap-Rate

17,8 M 12,5 M 6,5 M

10,0 M
5,0 M -

3,9 M

4,6 M

20,0% 18,0% 16,0% 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0%

SSU rent All vacant All vacant Rent/m Rent/m Rent/m using area leased area leased =70% RBS =100% RBS =Portfolio portfolio at SSU Rent at RBS Rent margin

Shopping Santa rsulas Potential NOI using different drivers