NEW OFFICE SEARCH. measure thrice & cut once

1. NEW OFFICE SEARCH.measurethrice & cutonce Olga kozina, managingdirector, newseclatvia 20.04.2012. PreparedforNekustamais īpašums un būvniecība

2. Tenants’ market. Tenants’ heaven?

3. Reasons to move. UNSatisfaction? • Location not suitable for the business profile • Accessibility insufficient for clients or employees • Obsolete premises • Absence of necessary infrastructure • Willingness to improve working environment for employees • Inappropriate costs burden • Expansion planned • Newofficeas a motivatorfor a longstandingcompany • Currentofficewas a temporary solution in terms of strict time constraints • Ownershipchangeforexistingpremises • Leasecontractclose to expiring, newleaseconditions • Centralization, merge

4. Decision to move.Set, READY, GO! • Target:600 m² • Who’s in charge: • Shareholder, CFO, MD, secretary? • In-house Facility Manager? • RE professional? • Actions: • - Checking web pages. • - Calling. • Visiting. • Results: • - Comparing apples with pears.

5. process. Problems faced. • Availability of space. • Timing. • Compliance of space to the needs. • Compliance of costs to the budget.

6. PROBLEMS FACED. AVAILABILITY OF SPACE total office stock 0,5 mio sqm ca 80th sqm vacant criteria 1 criteria 2- criteria n 1-2 options

7. Problems faced. Timing DESIRED – YESTERDAY REALITY –UP TO FEW MONTHS AHEAD xx.yy.zz xx.yy.zz xx.yy.zz xx.yy.zz xx.yy.zz xx.yy.zz xx.yy.zz xx.yy.zz Decision Move in Definition of needs & priorities Selecting options Signing Negotiation of lease Analysis of opportunities Preparation of premises

8. Problems faced. Compliance of space to the needs • Useful space vs paid areas (inefficient planning, corners, corridors, etc). • Floor layout - open space vs cabinet structure (depending on the business profile) • Size – sq m vs working stations • Availability of infrastructure (engineering and social, business infrastructure) • Technical requirements (availability, lack of capacities, etc) • Availability of parking • Availability of public transport access • Existing/possible internal finishing • Investments coverage

9. Problems faced. Budget Turnover/rent ratio Office Rent rates, Riga, EUR/sqm • Accordance to financial capabilities (sales/rent) • Not only rental costs but also property management, maintenance and utilities budget • Maintenance costs allocation/calculations • Clear rent review mechanisms • Parking costs, any additional costs • Guarantees asked by the Landlord

10. Result. Do I really need it?! • Wasted time • Wasted money and resources • Deadlock

11. Back to basics. Real estate for occupiers • avoid wasting your resources • Identification of both current and future bbusiness needs • realistic timetable, accountable milestones, clear targets An integral part of the overall Company’s business strategy should be planned thoroughly • Clear reasons to move • Clear definition of needs& priorities • Setting up the plan

12. Back to basics. definition of needs& priorities • Business profile – proximity to clients, resources, magistral roads, business infrastructure etc • Number of working places / specifics of daily work – necessity for meeting areas, private and public areas, social areas, archives, server rooms, etc • Layout - open space vs cabinet system • Necessity for infrastructure/engineering – not only availability but also capacities • Parking and public transport accessibility • Requirements to working environment – global guidelines for international companies, local legislation, opening windows, healthy climat (moisturising system), daylight etc • Budget – costs & investments • Flexibility – major lease covenants • Image • Forecasted need for expansion

13. Back to basics. Liaising with professionals • Assistance in defining the needs and setting priorities (through interviews, employee surveys, etc.) • Assistance in understanding the market • Ensuring the best solution (in-depth analysis of options, comparing apples with apples, incl. planned or theoretical vacancies) • Predicting underwater stones and assistance in mitigating risks • Assistance in negotiations • Saving money • Saving time

14. BACK TO BASICS. CONCLUSIONS • No uniform solution - a tailored approach is necessary in each case • Get well prepared – most of problems faced are not about the Landlords or the market, but about structured approach • Riga office market is small – any solution is a synergy of compromises • Change from Tenants’ to Landlords’ market might happen very fast – same as it was vise-versa

15. NEWSEC GROUPIN BRIEF • Newsec Advice • A leading property advisor in Northern Europe with 70 professionalsand access to more information than any player • Valuation value over 50 MEURlast 12 months • Newsec Asset Management • The leading asset manager in Northern Europe with about 400 professionalsand offices throughout the region • Manage over 1 000 properties representing over 7 million sq m • Newsec Transactions • Transaction team of 30 professionalsspecializing in investment and corporate finance • Offering tailor-made property-related financial and strategic advisory services • A leading advisor within wind power • Lease volume of over 350 000 sq mlast 12 months

16. TRACK RECORD - AGENCY AgencyTeam, Latvia – Major lettingdeals 2010 - 1011 Client / project: Type: Size (sq. m): Tieto Office 7 000 Transcom Office 1 700 Inspecta Office900 MicrosoftOffice900 Mepha Office500 ERGO Office 2000 Karcher Retail 550 Microsoft Agency Team, Latvia – Major clients 2010 - 1011 Selected reference projects, Latvia

17. OLGA KOZINA MANAGING DIRECTOR, LATVIA Direct + 371 675 08405, Cell + 371 296 97989 O.Kozina@newsec.lv NEWSEC Latvia Zaļā iela 1 Rīga, LV-1010 Tel: +371 6750 8400 Fax: +371 6750 8401