Annual Financial Report

INDUSTRIAL MULTI PROPERTY TRUST PLC

(the "Company" or together with its subsidiaries the "Group")

ANNUAL RESULTS

FOR THE YEAR ENDED 31 DECEMBER 2014

Highlights

· Adjusted net asset value ("NAV") per ordinary share increased- 220 pence as at 31 December 2014 (207 pence at 31 December 2013 restated).

· Adjusted earnings per ordinary share decreased - loss of 19.4 pence for the year ending 31 December 2014 (profit of 12.6 pence for the year ending 31 December 2013 restated).

· New lettings achieved - 87 new lettings and 41 lease renewals achieved during 2014 (representing 22.2% of the estimated rental value ("ERV") of the total portfolio, based on the final achievable annual rent including stepped rent).

· Additional contracted rent attained- £0.6 million per annum of additional passing rent is contracted to start during 2015, directly benefiting cash flow.

· Occupancy improved - the occupancy level measured by estimated rental value stood at 86.5% as at 31 December 2014 compared with 84.6% as at 31 December 2013.

· Portfolio valuation increased- the Group's property portfolio was valued at £79.9 million as at 31 December 2014 (£77.5 million as at 31 December 2013), an increase of £2.4.million (3.1%) during the year.

87

87 new lettings during the year

86.5%

Occupancy rate increased during the year

220p

Adjusted NAV of 220 pence per share

£79.9 million

Portfolio valuation increase of 3.1% to £79.9 million

Contact:

Jonathan Clague

Chairman, Industrial Multi Property Trust plc

01624 681250

Tom Pissarro

Investment Adviser and Manager, Alpha Real Capital LLP

020 7391 4700

For more information on the Company please visit www.alphamultipropertytrust.com 

For more information on the Company's Investment Adviser and Manager please visit www.alpharealcapital.com

FORWARD-LOOKING STATEMENTS

These results contain forward-looking statements which are inherently subject to risks and uncertainties because they relate to events and depend upon circumstances that will occur in the future. There are a number of factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are based on the Board's current view and information known to them at the date of this Statement. The Board does not make any undertaking to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Nothing in these results should be construed as a profit forecast.

Company summary and objectives

Objectives

Industrial Multi Property Trust plc ("the Company") was incorporated in the Isle of Man on 10 June 2002 as a closed-ended investment company. The Company and its subsidiaries (together "the Group") invest in higher yielding UK commercial property. The key objectives are:

· Increase earnings and cash flow- increase occupancy in the portfolio and reduce expenses.

· Protect and enhance asset values- prudent investment in selected portfolio properties.

· Strengthen the balance sheet- reduce bank borrowings progressively, consistent with the investment programme for the property portfolio.

Dividends

The Company paid no dividends during the year and no dividend is currently proposed (2013: £nil).

Listing

The Company is a closed-ended Isle of Man registered investment company which has been declared under the relevant legislation to be a closed-ended Collective Investment Scheme. Since 27 October 2014, its shares have traded on the Specialist Fund Market of the London Stock Exchange, an EU regulated market, following a transfer of the shares from a listing on the Official List of the UK Listing Authority. The shares have been traded on the London Stock Exchange since 4 April 2003. Following shareholders' approval at the Extraordinary General Meeting, on 26 September 2014 of the new Articles, the Company's continuation vote has been removed. 

Management

The Company's Investment Adviser and Manager is Alpha Real Capital LLP ("Alpha"). Control of the Company rests with the non-executive Isle of Man based Board of Directors.

ISA/SIPP status

The Company's shares are eligible for Individual Savings Accounts (ISAs) and Self Invested Personal Pensions (SIPPs).

Website

www.industrialmultipropertytrust.com

Financial highlights

1The adjusted net assets are presented to provide what the Board believes is a more relevant assessment of the Group's net asset position. The Board has determined that certain fair value and accounting adjustments may not be realisable in the longer term (see note 16).

2The adjusted earnings are presented to provide what the Board believes is a more appropriate assessment of the operational income accruing to the Group's activities. Hence the Board adjusts basic earnings for income and costs which are not of a recurrent nature or which may be more of a capital nature (see note 15)

Chairman Statement

I am pleased to present the Annual Report and the Consolidated Financial Statements of Industrial Multi Property Trust plc for the year ended 31 December 2014.

Property performance

The active asset management initiatives within the portfolio have assisted in the retention of tenants and the letting of vacant units. The Group has achieved 87 new lettings and 41 lease renewals increasing the occupancy level across the Group by 1.9%, to 86.5% (by ERV) as at 31 December 2014 compared with 84.6% as at 31 December 2013, enhancing the Group's income. Further detail on asset management progress appears in the Investment Adviser and Manager's report.

On a like for like basis, the property valuation increased by £2.4 million to £79.9.million at 31 December 2014 (£77.5 million at 31 December 2013). This represents an increase of 3.1%. An evaluation of the Group's property portfolio performance can be found in the Investment Adviser and Manager's report.

Financial performance

The adjusted NAV per ordinary share at 31 December 2014 is 219.9 pence (31 December 2013 restated: 206.8 pence). The increase is attributable mainly to the increase in property portfolio valuation.

The results for the year show an adjusted EPS loss of 19.4 pence (31 December 2013 restated: profit of 12.6 pence). The decline is attributable to the loss resulting from the increase in finance costs during the period.

Bank borrowings and financing

As previously reported, the Group entered into new financing agreements on 5 December 2013. These new loan facilities are for a period of five years expiring in December 2018. A hedging arrangement was entered into on 27 January 2014, which has the effect of fixing the Group's interest rate exposure on £25.1 million of debt until 5 December 2018. Further details can be found in note 24. During the year the Group was compliant with the bank borrowing covenants.

Further details on the Group's long term borrowings are provided in note 24 and within the Investment Adviser and Manager's report.

Change of name

With effect from 1 July 2014, Alpha UK Multi Property Trust plc has changed its name to Industrial Multi Property Trust plc. The new name was approved by shareholders at the Company's annual general meeting held on 30 June 2014 and better reflects the nature of the Company's portfolio of predominantly industrial assets. The ticker symbol has been changed to IMPT for the Company's ordinary shares.

CHIP (Six) Limited

The liquidation of CHIP (Six) Limited completed on 1 September 2014. The liquidators were released from their duties and the company is now dissolved.

Going concern

The Board has concluded that the Company and the Group is considered to be a going concern and as a result of this the Consolidated financial statements for the year ended 31 December 2014 have been prepared on the going concern basis. Further details on the basis of preparation is provided in note 2 to the financial statements.

Prior year restatement

Certain 2013 balance sheet items, namely trade and other receivables, have been restated. For further information, see note 2.

Outlook

Industrial Multi Property Trust plc enters into a new financial year with continued focus on making further progress in preserving, improving the profile of income from its property portfolio and enhancing its asset value.

With the new long term financing arrangements in place the Board believes that the Group's strategy provides a strong platform from which to rebuild shareholder value over the medium to long term, recognising that the new financing arrangements result in increased finance costs. The Board is confident that the Group will be able to service its debt going forward and, with an improving secondary commercial property market, the Group and therefore the shareholders may eventually see an improvement in the net asset value in the medium term.

Jonathan Clague

Chairman

5 March 2015

Investment Adviser and Manager's report

The Investment Adviser and Manager's strategy to deliver shareholder value will continue to focus on the following objectives:

· To enhance net rental income - the marketing strategy for vacant units will aim to meet tenant requirements for good quality affordable accommodation on flexible lease terms.

· To selectively deploy capital expenditure when 'value add' opportunities are identified - a rolling programme of maintenance will continue to be undertaken. However priority will be given to refurbishments where a property can be significantly enhanced to attract additional tenant demand. The Investment Adviser and Manager is also looking to identify opportunities to extend leases and or remove tenant breaks where appropriate value can be unlocked.

· To reduce borrowings through rental surplus and to reduce the LTV ratio through limited strategic sales - disposals, which may be considered where it is believed that the price net of costs, likely to be achieved, will benefit shareholder returns.

The strategy to concentrate on active asset management initiatives within the portfolio offers tangible opportunities to generate strong positive cash flow and enhanced NAV per share in the future.

Portfolio overview

The portfolio predominantly comprises a well-diversified portfolio of fifty three multi let properties offering 507 leasable units with a total floor area of approximately 163,600 square metres (approximately 1.8 million square feet) all of which are located in the UK. The properties offer attractively priced accommodation for local and regional occupiers.

Of the total portfolio, approximately 85% is invested in light industrial property and 15% is invested in offices.

Tenants have continued to favour shorter term flexible leases and against this background the weighted average lease length is 3.2 years to expiry and 1.9 years to the earlier of the next tenant break or expiry.

Asset management review

The occupational market continues to show signs of improving, and the Group's flexible approach to meeting tenant demand has been successful in reducing the number of vacant units: 87 new lettings and 41 lease renewals were completed during the period, with a further 15 units under offer as at 31 December 2014. Many of the leases incorporate stepped increases in rents and there is an additional £0.6 million per annum of contracted rent due to start during the next twelve months which will benefit the cash flow.

The impact of tenant insolvency has increased with 8 tenants, accounting for 3.4% of ERV, becoming insolvent compared with 8 tenants (1.3% of ERV) in the same period last year. Equally the impact of tenants vacating at the end of the term has increased with 40 tenants, accounting for 8.2% of ERV, vacating compared with 40 tenants (5.0% of ERV) in the same period last year.

Against this background, the number of new lettings is encouraging and notable progress has been made in increasing occupancy. Based on ERV, the occupancy level stood at 86.5% on 31 December 2014 compared to 84.6% as at 31 December 2013.

*Final achievable annual rent including stepped rents.

Based on the current total portfolio ERV, there is also the potential for additional rent of £1.8 million per annum assuming the portfolio were to become fully let and income producing.

Property Sales

In keeping with the Board's strategy to undertake limited strategic sales, one sale completed during the year. A small parcel of land, including a redundant water tower, which adjoined one of the group's industrial estates, was sold in October 2014. The land was held at nil value and sold for £75k net of costs.

Valuation

The Group's property portfolio was valued at 31 December 2014 by DTZ Debenham Tie Leung Limited at £79.9 million (£77.5 million as at 31 December 2013) an increase of £2.4 million (3.1%) during the 12 month period. The average capital value of the portfolio is £484 per square metre (£45 per square foot).

Financing

As previously reported the Group entered into new financing agreements on 5 December 2013. It should be noted that the new mezzanine and sub-ordinated loan facilities carry a higher interest cost than the previous facilities. This higher cost of debt accounts for the negative movement in adjusted earnings per ordinary share.

The LTV ratio on total borrowings was 81.0% as at 31 December 2014 (83.2 % on total borrowings as at 31 December 2013).

UK Economy

Economic growth maintained momentum in Q4 2014 as the UK economy grew by 0.5% on the quarter, as measured by the expansion in gross domestic product ("GDP") output. Annual GDP growth has risen to 2.6% following four quarters of stable economic expansion.

An improving labour market in recent months has resulted in a fall in the nationwide unemployment rate to 5.7% as at December 2014. This compares favourably with the post-recession high of 8.5% reported at September 2011.

Despite signs of a tightening labour market, inflation levels remain low. Annual Consumer Price Index ("CPI") inflation fell to 0.3% in January 2015. This fall was partly driven by a drop in fuel and food prices, however core CPI inflation (which excludes fuel and food) rose by 0.1 percentage point to 1.4% in January 2015.

Looking ahead to 2015, inflation looks likely to remain low with heavy competition in food retailing and falling oil prices expected to continue. Interest rate policy has been steady with the Bank Rate remaining low at 0.5% during the period.

Property Commentary

Encouraged by positive sentiment from both domestic and overseas investors, a positive capital value growth trend continued across the UK commercial property market during the 12 month period to 31 December 2014.

Over the period, prime yields have generally contracted and sector or geographic specific secondary yields have stabilised and are showing marked signs of improvement. Higher yielding secondary assets are slowly starting to benefit from an improving financing sector and subsequent investor sentiment. However; the most notable positive pressure on prices currently remains at the prime end of the market.

A greater availability of debt and equity financing for secondary assets in the more attractive regional locations and good quality assets in secondary markets, is providing more liquidity and should continue to drive investor demand. Strong investment volumes are expected to continue into 2015 as more local and overseas investors target opportunities in regional markets across all sectors and an increasingly wide range of risk profiles.

Conclusion

The increased occupancy and the enhancement in the Group's property portfolio valuation is encouraging. The Investment Adviser and Manager's goal continues to be to increase the level of rent and occupancy throughout the portfolio and to build on the asset management success delivered during 2014.

Tom Pissarro

Alpha Real Capital LLP

Investment Adviser and Manager

5 March 2015

Directors

Jonathan Clague, Chairman

Jonathan Clague is a resident of the Isle of Man. He is the non-executive chairman of Heron & Brearley, a leading Manx brewer and public house operator and previously, was a non-executive director of Diamond Circle Capital Plc, Isle of Man Bank, NatWest Offshore Limited, Sun Alliance (IOM) Limited and PFI Infrastructure Company.

Geoffrey Black, Director

Geoffrey Black is a resident of the Isle of Man. He is a Fellow of the Royal Institution of Chartered Surveyors and is a senior partner of Black Grace Cowley, a leading firm of commercial property agents on the Isle of Man. Geoffrey has more than 35 years' experience in both the commercial and residential property markets and has acted for major UK institutions, such as Zurich Financial Services, Royal Bank of Scotland International, and for the Isle of Man Government.

Donald Lake, Director

Donald Lake is a resident of the Isle of Man. He is a Fellow of the Royal Institution of Chartered Surveyors and has many years' experience of the UK commercial property market both as an adviser to investment funds and as a principal. Donald is a director of Unitech Corporate Parks subsidiary in Mauritius. He is also a director of other companies active in the UK and elsewhere, and advises private clients on the Isle of Man and in the UK.

Philip Scales, Director - Chairman of the Audit Committee

Philip Scales is a resident of the Isle of Man. He is a Fellow of the Institute of Chartered Secretaries and Administrators and the managing director of the Company's Administrator, IOMA Fund and Investment Management Limited. Philip was previously the managing director of Barings (Isle of Man) Limited, which was acquired by Northern Trust in 2005. Philip has more than 35 years' experience in corporate and mutual fund administration and is currently on the boards of a number of listed companies.

Mark Rattigan, Director

Mark Rattigan holds a Bachelor of Civil Engineering (Honours) from the University of Sydney and an Investment Management Certificate from the UK Society of Investment Professionals.

He has previously been Chief Operating Officer and Director - Finance and Operations at RREEF (Deutsche Bank's real estate funds management group) based in London. He has over 25 years' experience in real estate, funds management and investment banking. His experience includes 13 years in real estate investment banking with Deutsche Bank, HSBC Investment Bank and Macquarie Bank in both London and Sydney and 5 years as a property development manager at Lend Lease.

Mark Rattigan is currently Chief Operating Officer of the Company's Investment Adviser and Manager, Alpha Real Capital LLP.

Directors' report

The Directors present herewith the Annual Report and Consolidated Financial Statements of the Group for the year ended 31 December 2014. The Corporate Governance Statement forms part of this Directors' report by reference.

The Company

The Company is an Isle of Man closed-ended investment company and was incorporated on 10 June 2002. Its principal activity is that of investment in UK commercial property. Since 27 October 2014, its shares have traded on the Specialist Fund Market of the London Stock Exchange, an EU regulated market, following a transfer from a listing on the Official List of the UK Listing Authority. The shares have been traded on the London Stock Exchange since 4 April 2003. Following shareholders' approval at the Extraordinary General Meeting on 26 September 2014 of the new Articles, the Company's continuation vote has been removed.

The Directors confirm that:

· no single property represents more than 15% of the gross assets of the Group;

· income receivable from any one tenant, or tenants within the same group, in any one financial year does not exceed 20% of the total rental income of the Group; and

· the proportion of the Group's property portfolio which is unoccupied or not producing income or which is in the course of substantial redevelopment or refurbishment does not exceed 25% of the value of the portfolio.

Business review

A review of the business during the year is contained in the Chairman's statement .

Results and dividends

The results for the year are set out in the financial statements.

Commentary on the net asset value and performance is given in the Chairman's Statement and Investment Adviser and Manager's Report which are incorporated into this Directors' report by reference.

The Company paid no dividends during the year and no dividend is currently proposed (2013: nil).

Corporate governance

The information fulfilling the requirements of the Corporate Governance Statement can be found in this Directors' report.

Directors

Biographical details of the Directors of the Company who served during the year are given above. Their interests in the share capital of the Company are shown below:

Financial instruments

Information about the use of financial instruments by the Group is given in note 20 to the consolidated financial statements.

Post balance sheet events

Details of significant events since the balance sheet date are contained in note 29 to the consolidated financial statements.

Substantial shareholdings

During the period between 31 December 2014 and 6 March 2015 the Company did not receive any notifications under chapter 5 of the Disclosure and Transparency Rules.

Directors' indemnities

On 4 October 2014, a third party indemnity (Director and Officer insurance) was given by the Company to the Directors in terms which comply with Company law and remains in force at the date of this report.

Company Secretary

Martin Katz served as Secretary throughout the year.

Going concern

The Directors have concluded that the Company and the Group is considered to be a going concern and as a result of this the consolidated financial statements for the year ended 31 December 2014 have been prepared on the going concern basis. Further detail on the basis of preparation of the financial statements is provided in note 2.

Continuation vote

At the Extraordinary General Meeting, which was held on 26 September 2014, shareholders voted in favour of amendments to the Articles, which included the removal of the five yearly continuation of vote.

Prior year restatement

Following a re-evaluation of the accounting approach to lease incentive receivables, these are now solely incorporated as a component of the carrying value of investment properties, consistent with our clarified accounting policy. Previously lease incentive receivables have been carried within trade and other receivables as well as indirectly within the valuation of investment properties (see note 2).

Jonathan Clague

Chairman

5 March 2015

Corporate governance statement

The Board of Directors is accountable to the Company's shareholders for the management and control of the Company's activities and is committed to appropriate standards of corporate governance. The statement below explains how the Company applies the principles set out in the UK Corporate Governance code (''the Code'') published by the Financial Reporting Council and contains the information required by chapter 7 of the Disclosure and Transparency Rules. The UK Corporate Governance code can be viewed at www.frc.org.uk.

Statement of compliance

The Company has, other than where stated below, complied fully with the provisions set out in the Code during the year ended 31 December 2014:-

· As matters relating to remuneration and nominations are dealt with at regular board meetings, no separate Remuneration and Nomination committees have been established.

The Directors consider this structure to be a practical solution bearing in mind the Company's size and needs.

Further explanation of how the principles and the supporting principles have been applied is set out below and in the Audit Committee report.

Role of the Board

The Board has determined that its role is to consider and determine the following principal matters which it considers are of strategic importance to the Company:

1) review the overall objectives for the Company and set the Company's strategy for fulfilling those objectives within an appropriate risk framework;

2) consider any shifts in strategy that it considers may be appropriate in light of market conditions;

3) review the capital structure of the Company including consideration of any appropriate use of gearing for the Company in which the Company may invest from time to time;

4) appoint the Investment Adviser and Manager, Administrator and other appropriately skilled service providers and monitor their effectiveness through regular reports and meetings; and

5) review key elements of the Company's performance including the net asset value, earnings per share, adjusted net asset value per share, adjusted earnings per share and payment of dividends.

The Board has adopted a schedule of matters reserved for its decisions and a schedule of matters delegated to the Investment Adviser and Manager, both of which are reviewed at least annually. The Board reserves approval for all significant or strategic decisions including property acquisitions, disposals, significant capital expenditure and financing transactions. The Directors are entitled to take independent professional advice as and when necessary. The Board ensures that all strategic matters are considered and resolved at Board Meetings.

Board Meetings

The Board meets at least quarterly and as required from time to time to consider specific issues reserved for decisions by the Board including all potential acquisitions and disposals, significant capital expenditure and leasing matters and decisions relating to the Company's financial gearing, the purpose of which is to ensure the long-term success of the Company for its shareholders.

Certain matters relating to the implementation of the Company's strategy are delegated either to the Investment Adviser and Manager or the Administrator but the performance of such delegation by these independent agents is regularly monitored by the Board.

At the Board's quarterly meetings, it considers papers circulated in advance including reports provided by the Investment Adviser and Manager. The Investment Adviser and Manager's report comments on:

· The UK property markets, including recommendations for any changes in strategy that the Investment Adviser and Manager considers may be appropriate

· Performance of the Group's portfolio and key asset management initiatives

· Transactional activity undertaken over the previous quarter and being contemplated for the future

· The Group's financial position including relationships with bankers and lenders

The Administrator provides a quarterly compliance, company secretarial and regulatory report.

The reports enable the Board to assess the success with which the Group's property strategy and other associated matters are being implemented and also to consider any relevant risks as well as to consider how they should be properly managed.

The Board also considers reports provided from time to time by its various service providers reviewing their internal controls.

In between its regular quarterly meetings, the Board has also met on a number of occasions during the year to approve property transactions and for other matters.

The table below shows the attendance at the Board and meetings during the year to 31 December 2014:

Messrs Clague, Black, Lake and Scales are non-executive directors and are considered to be independent. Mr Rattigan is a non-executive director of the Company but is also Chief Operating Officer of Alpha Real Capital LLP, the Investment Adviser and Manager.

The terms and conditions of appointment of non-executive Directors are available for inspection by any person at the Company's registered office and at the Annual General Meeting.

The Board has undertaken an annual evaluation of its own performance and that of its committees and Directors. All Directors are subject to an annual performance evaluation, which is an on-going exercise. Evaluation of the Board considers the balance of skills, experience, independence and knowledge of the company on the Board, its diversity, including gender, how the Board works together as a unit, and other factors relevant to its effectiveness.

Statement of Directors' responsibility

Company law requires the Directors to prepare the annual report and financial statements for each financial year which give a true, balanced, understandable and fair view of the state of affairs of the Company and of the Group and of the profit or loss of the Group for that year. Under Company law, directors are required to

provide the necessary information to shareholders in order to enable the shareholders to assess the Company's performance, business model and strategies. In preparing those financial statements, the Directors are required to:

· select suitable accounting policies and then apply them consistently;

· make judgements and estimates that are reasonable and prudent;

· state whether applicable accounting standards have been followed subject to any material departures disclosed and explained in the Group's financial statements; and

· prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and of the Group and enable them to ensure that the financial statements comply with the Companies Acts 1931 to 2004. They are also responsible for

safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Risk management and internal control

The Board recognises its ultimate responsibility for the Company's system of internal control. The Board understands its responsibility for ensuring that there are sufficient, appropriate and effective systems, procedures, policies and processes for internal control of financial, operational, compliance and risk management matters in place in order to manage the risks which are an inherent part of the business. The process for significant risks is in accordance with Turnbull Guidance.

The Board attaches considerable importance to the Group's systems of internal control and risk management by establishing a continuous process for identifying, evaluating and managing the risks which the Group faces.

During 2014, the exposures to risk, including the changing environments within the property sector and potential adverse consequences of global economic conditions, and refinancing risks were closely monitored by the Directors.

The Audit Committee, along with the Board, has responsibility for monitoring the work carried out under contractual arrangements, and delegated authorities as appropriate, by the Investment Adviser and Manager, the Administrator, the Property Manager and Property Valuer. This, combined with frequent communication with the external auditors ensures that sufficient controls for managing risks are in place in line with the Code.

Risk management covers operations, security, compliance, finance, legal and strategy. The Board monitors these areas closely and matters are reviewed at meetings of the Audit Committee.

However, internal controls are designed to manage rather than eliminate the risk of failure to achieve business objectives, and the Board recognises that any system can only provide reasonable and not absolute assurance against material misstatement or loss.

Internal audit

The Group has no employees and therefore the Board is reliant upon the systems and procedures employed by the Investment Adviser and Manager and the Administrator which are regularly reviewed and are considered to be sufficient to provide it with the required degree of comfort. Resulting from this, the Board continues to believe that there is no need for an internal audit function, although it continues to monitor such need on an annual basis.

Investment Adviser's and Management Agreement

The Company has an Investment Adviser's and Management Agreement with the Investment Adviser and Manager. This sets out the Investment Adviser and Manager's key responsibilities which include proposing a property investment strategy to the Board, The Investment Adviser and Manager is also accountable to the Board for all issues relating to property asset management.

Remuneration report

During the year the Directors received the following remuneration in the form of fees from the Company:

Going concern

The Directors have concluded that the Company and the Group is considered to be a going concern and as a result of this the consolidated financial statements for the year ended 31 December 2014 have been prepared on the going concern basis. Further detail on the basis of preparation of the consolidated financial statements is provided in note 2.

Jonathan Clague

Chairman

5 March 2015

Audit Committee Report

This report details the key activities of the Committee during the year, alongside our principal responsibilities.

Composition of the Committee

The Committee consists of a Chairman (Philip Scales) and other Non-Executive Directors (Geoffrey Black and Donald Lake). All are independent directors with significant financial experience, as detailed in the biographies. Meetings of the Audit Committee are attended by members of the Investment Adviser and Manager's finance team and the external auditors, KPMG Audit LLC.

The Committee meets regularly during the year in alignment with the financial reporting timetable and during the financial year ended 31 December 2014 they met on five occasions with attendance as detailed below.

Role and responsibilities

The purpose of the Committee is to assist the Board in its responsibilities for monitoring the integrity of the Group's financial statements, assessing the effectiveness of the Group's system of internal controls and monitoring the effectiveness, independence, and objectivity of the external auditors.

While the Board as a whole has a duty to act in the best interests of the Company, the Committee has a particular role, acting independently of management, to ensure that the interests of the shareholders are properly protected in relation to financial reporting and the effectiveness of the Group's systems of financial internal controls. The key responsibilities of the Committee are to:

· Monitor the integrity of the Group's financial statements and formal announcements on the Group's financial performance;

· Report to the board on the appropriateness of accounting policies and practices;

· Assess the effectiveness of the Group's system of internal controls and risk-management systems, including reviewing the process for identifying, assessing and reporting all key risks

· Review the scope, effectiveness, independence and objectivity of the audit process;

· Make recommendations to the Board on the appointment, reappointment, remuneration and terms of engagement of the external auditor;

· Develop and implement policy on the engagement of the external auditor to supply non-audit services, taking into account relevant ethical guidance regarding the provision of non-audit services by the external audit firm, and to report to the Board, identifying any matters in respect of which it considers that action or improvement is needed and making recommendations as to the steps to be taken;

· Report to the Board on how it has discharged its responsibilities; and

· Oversee the whistleblowing provisions of the Group and to ensure they are operating effectively.

Activities of the committee

Key areas formally discussed and reviewed by the Committee during 2014 include:

· Annual, half yearly and quarterly results, including the related formal announcements.

· Key accounting policies and issues, including property valuation.

· Impact of future financial reporting standards and changes to Corporate Governance Code, Disclosure and Transparency Rules and Listing Rules.

· Significant accounting, reporting and judgement matters.

· Internal controls and risk management process.

· Half yearly and annual auditor reports on planning and final opinion containing observations leading to recommendations for control or financial reporting improvement.

· Group's whistleblowing policy to satisfy themselves that this has met FCA rules and good standards of corporate governance.

Significant areas

Valuation of investment properties

In conjunction with the Investment Adviser and Manager the Committee has reviewed the independent valuation report and underlying assumptions and is satisfied that the valuations are appropriate and in accordance with RICS Appraisal and Valuation Standards (9th Edition - January 2014).

Revenue Recognition

The Committee considered the risk of fraud within revenue recognition and was satisfied that there were no issues arising.

Going concern - compliance with long term loan facilities

The Group has entered into new long term loan facilities and the Committee has considered whether the Group could service this debt. The Committee alongside the external auditor has reviewed a four year forecast and is satisfied that the terms of the loan facilities can be satisfied.

Related party transactions outside the normal course of business

The Group entered into a long term loan facility with Alpha Real Trust Limited during the year. The Committee has reviewed the agreement and the terms of the loan and is satisfied that the agreement has been properly documented, authorised and that the terms are commercially acceptable.

Prior year restatement

Following a re-evaluation of the accounting approach to lease incentive receivables, these are now solely incorporated as a component of the carrying value of investment properties, consistent with our clarified accounting policy. Previously lease incentive receivables have been carried within trade and other receivables as well as indirectly within the valuation of investment properties. The lease incentive receivables at 31 December 2013 stood at £1,456,000 (31 December 2012: £1,022,000) - see note 2.

External audit

The Group's external auditor is KPMG Audit LLC. The Committee is responsible for reviewing the independence and objectivity of the external auditors, and ensuring this is safeguarded notwithstanding any provision of any other services to the Group.

The Board recognises the importance of safeguarding auditor objectivity and has taken the following steps to ensure that auditor independence is not compromised:

· The Committee annually evaluates the external auditor as to its complete independence from the Group and relevant officers of the Group in all material respects and that it is adequately resourced and technically capable to deliver an objective audit to shareholders. Based on this review the Committee recommends to the Board each year the continuation, or removal and replacement, of the external auditor;

· The external auditors provide audit related services such as regulatory and statutory reporting as well as formalities relating to shareholders and other circulars;

· The Committee regularly reviews all fees paid for audit, and all consultancy fees, with a view to assessing reasonableness of fees, value of delivery, and any independence issues that may have arisen or may potentially arise in the future;

· The external auditors' report to the Directors and the Committee confirming their independence in accordance with auditing standards. In addition to the steps taken by the Board to safeguard auditor objectivity, KPMG Audit LLC rotates audit partners every five years.

In addition, the Committee oversaw the tender of the external audit in line with The Code requirements. The successful firm KPMG Audit LLC performed the external audit for the year ending 31 December 2014.

The appointment of the external auditor is subject to shareholder approval each year at the Annual General Meeting, giving shareholders the opportunity to accept or reject the Board's recommendation.

The Committee has adopted a policy for the provision of non-audit services and reviews and approves all material non-audit related services in accordance with the need to ensure the independence and objectivity of the external auditors, at the regular Committee meetings

As shown in note 7 to the financial statements, total fees payable to KPMG Audit LLC in the current financial year amounted to £42,000 for audit services. Fees payable in the current financial year for the audit services prior to the appointment of KPMG Audit LLC was £6,000.

Directors' statement pursuant to the Disclosure and Transparency Rules

Each of the Directors, whose names and functions are listed in the Directors' Report confirm that, to the best of each person's knowledge and belief:

· The Group and Company financial statements, which have been prepared, in accordance with IFRSs, give a true and fair view of the assets, liabilities, financial position and profit of the Group and Company, and

· The Chairman's Statement, Investment Adviser and Manager's report and Director's report includes a fair review of the development and performance of the business and the position of the Company and Group together with a description of the principal risks and uncertainties that they face.

By order of the Board,

Jonathan Clague Philip Scales

Director Director

Report of the Independent Auditors, KPMG Audit LLC, to the shareholders of Industrial Multi Property Trust plc ONLY

Opinions and conclusions arising from our audit

1. Our opinion on the financial statements is unmodified

We have audited the financial statements of Industrial Multi Property Trust plc for the year ended 31 December 2014 which comprise the Consolidated Statement of Comprehensive Income, the Consolidated and Parent Company balance sheets, the Consolidated and Parent Statement of Changes in Equity and the Consolidated and Company Statements of Cash Flows and the related notes.

In our opinion the financial statements:

· Give a true and fair view of the state of the Group's and Parent Company's affairs as at 31 December 2014 and of the Group's profit for the year then ended;

· Have been properly prepared in accordance with International Financial Reporting Standards, as endorsed by the EU; and

· Have been properly prepared in accordance with the provisions of the Companies Acts 1931 to 2004.

2. Our assessment of risks of material misstatement

In arriving at our audit opinion above on the financial statements, the risks of material misstatement that had the greatest effect on our audit were as follows:

Carrying value of investment property (£77.9 million)

Refer to Audit Committee Report, note 2 (accounting policy for investment property) and note 18 (investment property).

The risk: The Group's investment property portfolio makes up 93.7% of total assets (by value) and is considered to be the key driver of the Group's capital and revenue performance. The investment properties held by the Group are primarily UK based secondary industrial multi-tenant sites. The property values are inherently estimates driven by tenant occupation levels and terms, comparable transactions, as well as market sentiment.

Our response: Our procedures over the valuation of the Group's investment property portfolio included, among others:

· understanding and critically assessing the processes in place to record investment transactions and to value the portfolio;

· agreeing the valuation of 100% of investment properties held to valuation reports prepared by external experts appointed by the directors;

· using our own property specialist considering the terms of engagement and basis of preparation of externally prepared property valuation reports, and assessing the competence and capability of the appointed expert;

· for a sample of properties, selected by value, we have identified and agreed key inputs in the externally prepared property valuation reports to other evidence, such as lease agreement rents, obtained during the course of our audit, or corroborating the validity of key inputs to independently obtained market data where appropriate and recalculating key computations;

· assessment of the adequacy of disclosures with regard to the investment property portfolio held.

Going concern: debt service and covenant compliance (Borrowings: £62.8m)

Refer to Audit Committee Report, note 2 (accounting policy for revenue) and note 24 (Long-term borrowings).

The risk: The Group's investment property portfolio is funded by a number of loans secured against the Group's assets. These loans require minimum covenant thresholds, primarily loan to investment property value and interest cover ratios, to be complied with on an on-going basis in order to ensure that the facilities are not at risk of withdrawal from the financing providers. The withdrawal of financing could risk that the Group will be forced to sell the properties to repay borrowings, loss of control of the properties or the going concern of the group. The directors have concluded that, in view of the forecasts provided for the period to 2018, the degree of uncertainty attached to whether the going concern basis is appropriate is not material. As this assessment involves consideration of future events, there is a risk that the judgement is inappropriate and that the uncertainty should have been assessed as material, in which case additional disclosures would have been required.

Our response: Our procedures over the compliance of the Group with debt service and covenant requirements included the following:

· agreement to source funding documentation for covenant requirements to which the Group is subject;

· obtaining independent confirmation from financing providers of amounts due;

· agreement of key inputs and recalculation of all financing covenants to which the Group is subject;

· assessment of key financing debt service and repayment terms, and the ability of the group to meet these requirements for at least 18 months post period end (including assessment of compliance to cashflow sensitivities). We have agreed key inputs to the forecast financial information to supporting documentation and recalculation of key computations; and

· consideration of the appropriateness of the Group's disclosures with regard to financing facilities and associated terms and requirements

3. Our application of materiality and an overview of the scope of our audit

The materiality for the financial statements as a whole was set at £280,000. This has been determined with reference to a benchmark of Group net assets (of which it represents 1.5%). Net assets, which is primarily dependent upon the value of the Group's investment property portfolio, is considered to be the key driver of the Group's capital and revenue performance and, as such, we consider it to be one of the principal considerations for members of the Company in assessing the financial performance and position of the Group.

We report to the Audit Committee any corrected and uncorrected identified misstatements we identified exceeding £14,000, in addition to other identified misstatements below that threshold that warranted reporting on qualitative grounds.

The Group audit team performed the audit of the Group as if it was a single aggregated set of financial information. The audit was performed using the materiality levels set out above and covered 100% of total Group revenue, Group profit before taxation, and total Group assets. Our work was performed at the head office of the investment manager, Alpha Real Capital LLP, in London and administrator, IOMA Fund and Investment Management Limited, in the Isle of Man.

4. We have nothing to report in respect of the matters on which we are required to report by exception

Under ISAs (UK and Ireland) we are required to report to you if, based on the knowledge we acquired during our audit, we have identified other information in the annual report that contains a material inconsistency with either that knowledge or the financial statements, a material misstatement of fact, or that is otherwise misleading.

In particular, we are required to report to you if:

· we have identified material inconsistencies between the knowledge we acquired during our audit and the directors' statement that they consider that the annual report and financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's performance, business model and strategy; or

· the Audit Committee Report does not appropriately address matters communicated by us to the Audit Committee.

Under the Companies Acts 1931 to 2004 we are required to report to you if, in our opinion:

· proper books of account have not been kept by the Parent Company and proper returns adequate for our audit have not been received from branches not visited by us; or

· the Parent Company's balance sheet and income statement are not in agreement with the books of account and returns; or

· certain disclosures of directors' remuneration specified by law are not made; or

· we have not received all the information and explanations we require for our audit.

We have nothing to report in respect of the above responsibilities.

Respective responsibilities of Directors and Auditor

As explained more fully in the Directors' Responsibilities Statement, the Directors are responsible for the preparation of financial statements that give a true and fair view. Our responsibility is to audit, and express an opinion on, the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.

Scope of an audit of financial statements performed in accordance with ISAs (UK and Ireland)

An audit in accordance with ISAs (UK and Ireland) involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Group's and Company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Directors; and the overall presentation of the financial statements. In addition we read all the financial and non-financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

The risks of material misstatement detailed in the section of our report titled "Our assessment of risks of material misstatement", are those risks that we have deemed, in our professional judgement, had the greatest effect on: the overall audit strategy; the allocation of resources in our audit; and directing the efforts of the engagement team. Our audit procedures relating to these risks were designed in the context of our audit of the financial statements as a whole. Our opinion on the financial statements is not modified with respect to any of these risks, and we do not express an opinion on these individual risks.

Materiality is a term used to describe the acceptable level of precision in financial statements. We identify a monetary amount of 'materiality for the financial statements as a whole' based on our judgement as to the quantitative amount of a misstatement or an omission that could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. The concept of materiality is applied both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected misstatements, if any, on the financial statements and in forming the opinion in our report.

When planning and performing the audit, materiality is used in evaluating the risk of material misstatement for each financial statement caption, and therefore the extent and persuasiveness of audit evidence required by us. In turn, materiality will also define the level of precision applied to individual audit procedures.

Materiality is also used in the calculation of the quantitative level below which individual misstatements are considered to be clearly trivial and do not need to be reported to those charged with governance or corrected. If, in the specific circumstances of the entity, there is one or more particular classes of transaction, account balances or disclosures for which misstatements of lesser amounts than materiality for the financial statements as a whole could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements, we also determine the materiality level or levels to be applied to those particular classes of transaction, account balances or disclosures.

When evaluating the effect of identified misstatements on the audit, and of uncorrected misstatements on the financial statements, we request that misstatements are corrected and then apply judgement in identifying whether an uncorrected misstatement or omission is material. To do so we make reference to the monetary amount of 'materiality for the financial statements as a whole' determined when planning the audit. The materiality determined when planning the audit does not necessarily establish an amount below which uncorrected misstatements, individually or in the aggregate, will always be evaluated as immaterial. We also consider the impact of misstatements on individual account balances or classes of transaction.

Furthermore, the qualitative circumstances related to some misstatements may cause us to evaluate them as material even if they are below the relevant quantitative materiality level. Similarly, the circumstance related to some misstatements (for instance those relating to classification or presentation) may cause us to evaluate them as not material to the financial statements as a whole even if they are above the relevant quantitative materiality level.

Whilst an audit conducted in accordance with ISAs (UK and Ireland) is designed to provide reasonable assurance of identifying material misstatements or omissions it is not guaranteed to do so. Rather the auditor plans the audit to determine the extent of testing needed to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements does not exceed materiality for the financial statements as a whole. This testing requires us to conduct significant audit work on a broad range of assets, liabilities, income and expense as well as devoting significant time of the most experienced members of the audit team, in particular the engagement partner responsible for the audit, to subjective areas of accounting and reporting.

The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the Company's members, as a body, in accordance with Section 15 of the Companies Act 1982. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Simon Nicholas

Responsible Individual

For and on behalf of KPMG Audit LLC

Statutory Auditor

Chartered Accountants

Heritage Court

41 Athol Street

Douglas

Isle of Man

IM99 1HN

\* The financial information is restated and details are contained in note 2.

There are no other items that require disclosure in the consolidated statement of comprehensive income.

\* The financial information is restated and details are contained in note 2.

These financial statements were approved by the Board of Directors on 5 March 2015 and signed on its behalf by:

Consolidated and Company statement of changes in equity

\* The financial information is restated and details are contained in note 2.

Consolidated statement of cash flows

\* The financial information is restated and details are contained in note 2.

These financial statements were approved by the Board of Directors on 5 March 2015 and signed on its behalf by:

\* The financial information is restated and details are contained in note 2.

\* The financial information is restated and details are contained in note 2.

Notes to the financial statements

For the year ended 31 December 2014

1 General information

The Company

The Company was incorporated in the Isle of Man on 10 June 2002. It is a closed-ended investment company and was formed primarily for investment in UK commercial property. The registered office of the Company is IOMA House, Hope Street, Douglas, Isle of Man, IM1 1AP. The aim of the Company and its subsidiaries (together "the Group") is to seek to improve income, reduce debt and provide the prospect of long-term capital growth. The Group has no employees.

Balance sheet presentation

The format of the consolidated balance sheet has continued to be presented on the same basis as the last annual consolidated financial statements.

Adjusted earnings per share and adjusted net asset value

The adjusted earnings per share and adjusted net asset value are presented in the annual financial statements to provide what the Company believes is a more relevant assessment of the Group's earnings and net asset value position.

2 Summary of significant accounting policies

Basis of preparation

The consolidated financial statements have been prepared on a historical cost basis, except for investment property and derivative financial instruments that have been measured at fair value.

The consolidated financial statements are presented in pounds sterling and rounded to the nearest thousand unless otherwise stated. The functional and presentational currency of the Company is the pound sterling and there are no foreign exchange transactions. The Group's financial performance does not suffer materially from seasonal fluctuations.

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IASB) and also to comply with relevant Isle of Man law.

On 5 December 2013, the Company and Group have entered into new financing agreements which will expire in December 2018, as follows:

· a £33.5 million senior loan facility with a five-year term expiring in December 2018 at an initial margin of 3% per annum over LIBOR, with Royal Bank of Scotland PLC ("RBS"); and

· a £20.0 million mezzanine loan facility with a five-year term expiring in December 2018 at a coupon of 11% per annum, with Europa Mezzanine Finance SaRL ("Europa").

· a £11.5 million unsecured loan facility with a five-year term expiring in December 2018 at a coupon of 15% per annum, with ART.

On 27 January 2014, the Group entered into an interest rate swap agreement whereby interest on £25.1 million of the debt would be fixed at 2.0225% until 5 December 2018.

These long-term borrowings have given the Group the time to continue the asset management initiatives, which shall hopefully lead to recovery of shareholder value in the Company

In forming their view on whether it is appropriate to adopt the going concern basis in preparing the consolidated financial statements, the Board have reviewed cash flow projections to December 2018 to assess whether they continue to be able to meet its liabilities as they fall due and also meet the covenant terms of its loans. The projections include the following key assumptions:

· rental income based on contracted rental income from tenants secured as at 31 December 2014.

· rental income from some of the void properties becoming occupied based on historic and anticipated vacancy periods.

· void costs and non recoverable costs based on the expected occupancy rate.

· default rates based on expected and historic patterns.

· interest charges and arrangement fees have been based on new loan terms.

· current property valuations apply, and there is no valuation change assumed from occupancy or market movement.

The assessment of the cash flow projections shows that the Group is able to meet its liabilities as they fall due and comply with the covenants of its loan facilities.

Along with the above assessment of the cash flow projections, the refinancing of the loan facilities for five years, plus the approval by shareholders of the indefinite continuation of the Company, the Board considers it appropriate to prepare the Group and Company financial statements on a going concern basis.

Prior year financial information has been represented to conform with current year presentation where applicable.

Basis of consolidation

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at 31 December each year. Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies.

All intra-group balances, transactions and unrealised gains and losses resulting from intra-group transactions are eliminated in full.

Company statement of comprehensive income

In accordance with section 3(5) (b) (ii) of the Companies Act 1982, the Company is exempt from the requirement to present its own statement of comprehensive income. Of the profit on ordinary activities after taxation, £0.3 million profit (restated 2013: £2.5 million loss) has been made by the Company.

Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received, excluding discounts, rebates and sales taxes and duty. Specific income is recognised as follows:

· Rental income receivable under operating leases is recognised on a straight-line basis over the term of the lease, except for contingent rental income which is recognised when it arises.

· Lease incentives granted are recognised as an integral part of the net consideration for the use of the property and are therefore also recognised on the same straight line basis.

· Interest income is recognised as it accrues using the effective interest rate method.

· Income arising from expenses recharged to tenants is recognised in the period in which the expense can be contractually recovered. Service charges and other such receipts are included gross of the related costs in revenue as the directors consider that the Group acts as principal in this respect.

· A property is regarded as sold when the significant risks and returns have been transferred to the buyer, which is normally on unconditional exchange of contracts. For conditional exchanges, sales are recognised only when all the significant conditions are satisfied.

ExpensesAll expenses are calculated on an accruals basis. The Group's policy is to expense all property investment advisory fees. All other expenses are charged to the consolidated statement of comprehensive income.

Taxation

The Group is a resident in the Isle of Man for income tax purposes. The standard rate of tax on company profits in the Isle of Man is 0% except where profits are derived from Isle of Man land and property or banking business, where the standard rate is 10%. The Group is subject to Isle of Man Income Tax at a rate of 0% on its profits.CHIP (One) Limited, CHIP (Two) Limited, CHIP (Three) Limited, CHIP (Four) Limited and CHIP (Five) Limited are subject to UK non-resident landlord tax at a rate of 20% on their rental profits.

Investment properties

Investment property is measured initially at cost including transaction costs. Transaction costs include stamp duty, professional fees and legal services incurred to bring the property to the condition necessary for it to be capable of operating. Lease incentive receivables are treated as a component of the investment property carrying value.

Subsequent to initial recognition, investment property is stated at fair value. Gains or losses arising from changes in fair values are included in the consolidated statement of comprehensive income in the year in which they arise.

Investment property is derecognised when it has been disposed of or permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of investment property are recognised in the consolidated statement of comprehensive income in the year of retirement or disposal.

Gains or losses on the disposal of investment property are determined as the difference between net disposal proceeds received and the latest valuation of the investment property.

Rent and other receivables

Rent and other receivables are recognised and carried at the lower of their original invoiced value and recoverable amount. Where the time value of money is material, receivables are carried at amortised cost. Provision is made when there is objective evidence that the Group will not be able to recover balances in full. Balances are written off when the probability of recovery is assessed as being remote.

Cash and cash equivalents

Cash and short term deposits in the consolidated and Company balance sheets comprise cash at bank and short term deposits with an original maturity of three months or less. For the purposes of the consolidated and Company statements of cash flows, cash and cash equivalents consist of cash and short term deposits as defined above, net of outstanding bank overdrafts.

Restricted Cash

Where cash is in the Company's bank accounts, but not under the Company's sole control at the balance sheet date, these amounts are disclosed as restricted cash.

Interest bearing loans and borrowings

All loans and borrowings are initially recognised at fair value less directly attributable transaction costs. After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest method. Bank arrangement fees incurred are initially capitalised and are then amortised over the term of the loan.

Tenant depositsTenant deposit liabilities are initially recognised at fair value and subsequently measured at amortised cost where material. Any difference between the initial fair value and the nominal amount is included as a component of operating lease income and recognised on a straight line basis over the lease term.

Investment in subsidiariesThe Company's investments in its subsidiaries are designated at fair value through profit or loss. These

investments are stated at fair value, derived from the net assets of the subsidiary companies at the reporting date, with any surplus or deficit arising on revaluation being recognised in the statement of comprehensive income of the company.

Segmental reportingThe Directors are of the opinion that the Group is engaged in two operating segments which are carried out in eight geographical locations, as detailed in note 5.

Derivatives and hedging

The Group may use interest rate hedging instruments to hedge its risks associated with interest rates. It is not the Group's policy to trade in derivative financial instruments. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative. The Directors have elected not to apply hedge accounting rules under IAS 39 on the hedging arrangements. Any gains or losses in the value of these derivatives are recognised immediately in the consolidated statement of comprehensive income.

Deferred taxation

Deferred tax is provided for using the liability method on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are recognised only to the extent that it is probable that taxable profit will be available against which deductable temporary differences, carried forward tax credits or tax losses can be utilised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted at the balance sheet date.

Prior year restatement

Following a re-evaluation of the accounting approach to lease incentive receivables, these are now solely incorporated as a component of the carrying value of investment properties, consistent with our clarified accounting policy. Previously lease incentive receivables have been carried within trade and other receivables as well as indirectly within the valuation of investment properties. The lease incentive receivables at 31 December 2013 stood at £1,456,000 (31 December 2012: £1,022,000).

This re-evaluation requires an adjustment to the fair value movement of investment properties and receivables in the prior year and hence a restatement of balance sheet and income statements. As a consequence, the Company balance sheet has also been restated, as the issue resulted in a reduction in the net asset value of the company's subsidiaries, and as such an increase in the provision against intercompany loans receivable by the company was required to reflect this. The investment property and trade and other receivables notes also reflect this statement.

The loss for the year to 31 December 2013 is restated and now shows a 29.6 pence loss per share (previously 24.4 pence loss per share), following an increase to the loss for the prior year of £434,000, with a loss of £1,022,000 having been restated through the prior year's opening retained earnings. The restatement has had no impact on prior period's adjusted earnings per share. Although not a cash transaction, the cash flow is also restated to reflect the changes.

Impact on balance sheet items

3 Significant accounting judgements, estimates and assumptions

The preparation of the Group's financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected.

The key assumptions concerning the future and other key sources of estimation or uncertainty at the date of the Balance Sheet, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Valuation of investment property

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Group ensures the use of suitable qualified external valuers to value the investment properties and determine their fair value.

Investment property is initially recognised at purchase cost plus directly attributable acquisition expenses. Investment properties are carried at a revalued amount which is stated at its fair value as determined on an open market basis as at the reporting date. The fair value of investment property is based on valuation by an independent valuer who holds a recognised and relevant professional qualification and who has recent experience of the location and category of the investment property being valued.

Going concern

The Group's new borrowing facilities with Royal Bank of Scotland, Europa and Alpha Real Trust Limited terminate on 5 December 2018. Based on the assumption, current occupancy level and the removal of shareholders' continuation of vote, the Board is confident that the loan covenants will be met up to the maturity of the existing new long term borrowings.

3 Significant accounting judgements, estimates and assumptions (continued)

The fair value of investment property generally involves consideration of:

· Market evidence on comparable transactions for similar properties;

· The actual current market for that type of property in that type of location at the reporting

date and current market expectations;

· Rental income from leases and market expectations regarding possible future lease terms;

· Hypothetical sellers and buyers, who are reasonably informed about the current market

and who are motivated, but not compelled, to transact in that market on an arm's length

basis; and

· Investor expectations on matters such as future enhancement of rental income or market

conditions.

Incentive fees

Incentive fees are provided for when it is deemed likely a fee will become payable based on the likelihood of the Company achieving the target level of return. Further details can be found in note 22.

Operating leases

The Group has entered into commercial property leases on its investment property portfolio. The Group has determined, based on an evaluation of the terms and conditions of the arrangement, that it retains all of the risks and rewards of ownership of these properties and accounts for the contracts as operating leases.

Convertible unsecured loan stock ("CULS")

The liability element of the CULS was measured by determining the net present value of all the future cash flows under the instrument, discounted at the market rate at the time of issue. The discount rate of 13% was determined by reference to similar mezzanine lending transactions at that time.

4 Changes and future changes in accounting standards

a) New standards, interpretations and amendments thereof, adopted by the Group

The accounting policies adopted are consistent with those of the previous year, except that the Group has adopted the following new and amended IFRS and IFRIC as of 1 January 2013. The nature and the impact of each new standards and amendments are described below.

Other amendments to certain standards apply for the first time in 2014. However, they do not impact the annual consolidated financial statements of the Group.

IFRS 10 Consolidated Financial statements

IFRS 10 replaces the portion of IAS 27 Consolidated and Separate Financial Statements that addresses the

accounting for consolidated financial statements. IFRS 10 establishes a single control model that applies to all entities including special purpose entities. The changes introduced by IFRS 10 require management to exercise significant judgement to determine which entities are controlled, and therefore are required to be consolidated by a parent, compared with the requirements that were in IAS 27. This standard becomes effective for annual periods beginning on or after 1 January 2013.

IFRS 11 Joint Arrangements

IFRS 11 replaces IAS 31 Interests in Joint Ventures and SIC-13 Jointly-controlled Entities - Non-monetary

Contributions by Venturers. IFRS 11 removes the option to account for jointly controlled entities (JCEs) using

proportionate consolidation. Instead, joint arrangements that meet the definition of a Joint Venture are now

accounted for using the equity method. Otherwise joint arrangements are accounted for by recognizing the

group's share of the arrangements assets and liabilities.

IFRS 12 Disclosure of Interests in Other Entities

IFRS 12 includes all of the disclosures that were previously in IAS 27 related to consolidated financial statements, as well as all of the disclosures that were previously included in IAS 31 and IAS 28. These

4 Changes and future changes in accounting standards (continued)

disclosures relate to an entity's interests in subsidiaries, joint arrangements, associates and structured entities.

A number of new disclosures are also required including:

- a requirement to disclose judgements made in determining if the Group controls, has joint control or significant influence over an entity

- a requirement to disclose judgements made in determining the type of joint arrangement in which the Group has an interest

These standards become effective for annual periods beginning on or after 1 January 2013. As expected the adoption of IFRS 10, IFS 11 & IFRS 12 did not have material impact on the Group's financial statements in the year.

 (b) Standards issued but not yet effective

Standards issued but not yet effective up to the date of issuance of the Group's financial statements are

listed below. This listing of standards and interpretations issued are those that the Group reasonably expects to have an impact on disclosures, financial position or performance when applied at a future date. The Group intends to adopt these standards when they become effective.

IFRS 9 Financial Instruments: Classification and Measurement

The new standard removes the 1 January 2015 effective date of IFRS 9. The new mandatory effective date will be determined once the classification and measurement and impairment phases of IFRS 9 are finalised.

The first chapters of the new standard on accounting for financial instruments which will replace IAS 39 Financial Instruments: Recognition and Measurement.

The standard contains two primary measurement categories for financial assets:

- amortised cost; and

-  fair value.

Financial assets are classified into one of these categories on initial recognition.

A financial asset is measured at amortised cost if the following conditions are met:

- it is held within a business model whose objective is to hold assets in order to collect contractual cash flows, and

- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal outstanding.

All other financial assets are measured at fair value.

IFRS 9 Financial Instruments (Hedge accounting and Amendments to IFRS 9, IFRS 7 and IAS 39) issued November 2013:

· new hedge accounting chapter added;

· improvements to the reporting of changes in the fair value of an entity's own debt contained in IFRS 9 made more readily available; and

· removal of the mandatory effective date of IFRS 9.

Subsequently, the IASB has tentatively set the effective date of IFRS 9 as periods beginning on or after 1 January 2018.

5 Segmental analysis

Rental income - segmental analysis*

* The rental information presented to the Board is in the form of the annual rent passing at the year end rather than being the rent spread on a straight line basis over the term of the lease in the way prescribed by IAS 17. Consequently the rent passing information presented to the Board is adjusted here to agree with the rental income in the consolidated statement of comprehensive income.

Property valuation - segmental analysis

The Board considers the sector and region analysis above to be the significant segmental basis for the Group. The Board believes that the information is presented more clearly to investors in respect of the key segmental information.

Expenses are reviewed on a total basis split between property expenses and other expenses. The Board of Directors do not believe it is cost beneficial for the Group to consider the allocation of these costs between the operating segments mentioned above.

Trade and other receivables and trade and other payables are reviewed on a total basis. Long term borrowings are reviewed on a facility basis as per note 24. The Board of Directors do not believe it is cost effective for the Group to consider the allocation of these assets and liabilities between the operating segments mentioned above.

6 Income

Rental Income

The Group leases out all of its investment property under operating leases. Leases are typically for terms of 3 to 5 years. At the balance sheet date, the Group had contracted with tenants for the following future minimum lease payments:

Other income

Other income relates to insurance commission rebates negotiated by the Investment Adviser and Manager on behalf of the Group. These commission rebates continue to be shared between the Group, the Investment Adviser and Manager and the rent collection agent.

7 Expenditure

8 Finance income

The above interest income arises from financial assets classified as loans and receivables (including cash and cash equivalents) and has been calculated using the effective interest rate method.

9 Net gains and losses on loans and receivables

10 Net gains and losses on financial assets and liabilities at fair value through profit and loss

11 Finance costs

The above interest costs on borrowings arise on financial liabilities measured at amortised cost using the effective interest rate method. No other losses have been recognised in respect of financial liabilities at amortised cost other than those disclosed above.

12 Total interest income and total interest expense on financial assets and financial liabilities not at fair

value through profit and loss

13 Taxation

The Group's tax expense for the year comprises:

Current taxation

The Group is resident in the Isle of Man for income tax purposes. The standard rate of tax on company profits in the Isle of Man is 0% except where profits are derived from Isle of Man land and property or banking business, where the standard rate is 10%. The Group is subject to Isle of Man income tax at a rate of 0% on its profits.The Group's subsidiary companies are subject to UK non-resident landlord tax at a rate of 20% on their rental profits from UK property. The Group calculates its tax in respect of UK non resident landlord tax on a subsidiary by subsidiary basis; no group reliefs are available for non-resident landlords.

Deferred taxation

The Company has not recognised a deferred tax asset in relation to the losses carried forward due to the uncertain nature of future taxable profits.

As at 31 December 2014, the Group had unused tax losses and capital allowances of £10.1million

(31 December 2013: £8.9 million).

 14 Dividends

The Company paid no dividends during the year. (2013: £nil)

15 15 Earnings per share

The calculation of the basic and diluted earnings per share is based on the following data:

The adjusted earnings are presented to provide what the Board believes is a more appropriate assessment of the operational income accruing to the Group's activities. Hence, the Board adjusts basic earnings for income and costs which are not of a recurrent nature or which may be more of a capital nature.

The market to market movement of the interest rate hedging instruments are adjusted where the hedged facilities are currently in compliance of their banking covenants and are therefore unlikely to break prior to the expiry of the instrument.

The Group had issued CULS (see note 23) that could have potentially diluted the earnings per share in the future, but were not included in the calculation of diluted earnings per share because they are anti-dilutive for the period presented. The preference shares attached with the CULS have automatically been redeemed.

The CULS matured on 30 June 2013 and were repaid in full on that date.

16 16 Net asset value per share

The adjusted net assets are presented to provide what the Board believes is a more relevant assessment of the Group's net asset position. The Board has determined that certain fair value and accounting adjustments may not be realisable in the longer term.

16 17 Investments in subsidiaries

All of the subsidiary companies are incorporated in the Isle of Man, are wholly owned by Industrial Multi Property Trust plc and are all property holding companies.

All the subsidiary companies as at 31 December 2014 and 2013 had net liabilities, therefore the original cost of the investment held in the parent company has been fully impaired.

As at 31 December 2014, the Company's subsidiaries are CHIP (one) Limited, CHIP (Two) Limited, CHIP (Three) Limited and its subsidiaries, CHIP (Four) Limited and CHIP (Five) Limited.

18 18 Investment properties