Final Results

INDUSTRIAL MULTI PROPERTY TRUST PLC

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

ANNUAL RESULTS

FOR THE YEAR ENDED 31 DECEMBER 2015

Highlights

· Adjusted net asset value ("NAV") per ordinary share increased- 261 pence as at 31 December 2015 (220 pence at 31 December 2014).

· Adjusted earnings per ordinary share improved - loss of 18.1 pence for the year ended 31 December 2015 (loss of 19.4 pence for the year ended 31 December 2014).

· New lettings achieved - 68 new lettings and 51 lease renewals achieved during 2015 (representing 26.8% of the estimated rental value ("ERV") of the total portfolio, based on the final achievable annual rent including stepped rent).

· Additional contracted rent - £0.4 million per annum of additional passing rent is contracted to start during 2016, directly benefiting cash flow.

· Occupancy improved - the occupancy level measured by estimated rental value stood at 89.3% as at 31 December 2015 compared with 86.5% as at 31 December 2014

· Two light Industrial and four office buildings were sold above valuation - Six buildings were sold at £3.3 million before sales costs; 49% above the most recent valuation.

· Portfolio valuation increased - the Group's property portfolio was valued at £81.6 million as at 31 December 2015 (£79.9 million as at 31 December 2014), an increase of £1.7 million (2.1%) during the year (5.2% on a like for like basis).

68

68 new lettings during the year

89.3%

Occupancy rate, an increase of 2.8% during the year

261p

Adjusted NAV of 261 pence per share

an increase of 41 pence per share during the year

£3.3 million

Three sales (comprising six buildings) at 49% above

the most recent valuation

£81.6 million

Portfolio valuation increase of 2.1% to £81.6 million

5.2% increase

Excluding sold properties, on a like for like basis,

the portfolio valuation increased £4.0 million (5.2%)

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.

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 (2014: £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's 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 2015.

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 68 new lettings and 51 lease renewals increasing the occupancy level across the Group by 2.8%, to 89.3% (by ERV) as at 31 December 2015 compared with 86.5% as at 31 December 2014, 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 £81.6 million at 31 December 2015 (£77.6 million at 31 December 2014). This represents an increase of 5.2%. 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 2015 is 260.6 pence (31 December 2014: 219.9 pence). The increase of 41 pence per share is attributable mainly to the increase in property portfolio valuation.

The results for the year show an adjusted EPS loss of 18.1 pence (31 December 2014: loss of 19.4 pence). The continuing loss results from the high level of finance costs during the year.

Bank borrowings and financing

The Group entered into its current financing agreements on 5 December 2013. These loan facilities expire 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. Following the sale of properties the Group has repaid £2.5m (2014: £0.1m) of its borrowings during the year. Further details can be found in note 23. 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 23 and within the Investment Adviser and Manager's report.

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 2015 have been prepared on the going concern basis. Further details on the basis of preparation is provided in note 2 to the financial statements.

Outlook

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

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 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 should see a continued improvement in the net asset value in the medium term.

The Board reiterates its previously announced intention, to target a refinancing of the portfolio in Q4 2016 and if a refinancing is not possible it will continue to review alternative ways to improve shareholder value, including a managed winding up of the Company.

Jonathan Clague

Chairman

3 March 2016

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- two multi let properties offering 499 leasable units with a total floor area of approximately 156,100 square metres (approximately 1.7 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 86% is invested in light industrial property and 14% is invested in offices.

Tenants have continued to favour shorter term flexible leases and against this background the weighted average lease length is 3.83 years to expiry and 2.28 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: 68 new lettings and 51 lease renewals were completed during the year, with a further 10 units under offer as at 31 December 2015. Many of the leases incorporate stepped increases in rents and there is an additional £0.4 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 reduced with 5 tenants, accounting for 0.6% of ERV, becoming insolvent compared with 8 tenants (3.4% of ERV) in the same period last year. Equally the numbers of tenants renewing their leases at the end of the term has increased with 51 tenants, accounting for 15.3% of ERV, renewing their leases compared with 41 tenants (8.0% 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 89.3% on 31 December 2015 compared to 86.5% as at 31 December 2014.

*Final achievable annual rent including stepped rents.

Based on the current total portfolio ERV, there is also the potential for additional rent of £1.4 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, the portfolio continues to be reviewed to identify potential disposals where it is believed that the net sales proceeds will benefit shareholders returns, with three sales completed during the year. The two light industrial and four office buildings were sold at a combined sale price of £3.3 million, before sales costs, 49% above the most recent valuation.

Valuation

The Group's property portfolio was valued at 31 December 2015 by DTZ Debenham Tie Leung Limited (now trading as Cushman & Wakefield) at £81.6 million (£79.9 million as at 31 December 2014) an increase of £1.7 million (2.1%) during the 12 month period. The average capital value of the portfolio is £484 per square metre (£49 per square foot). Excluding the sales outlined above, on a like for like basis, the valuation of the portfolio increased by £4.0 million (+5.2%).

Financing

As previously reported the Group entered into financing agreements on 5 December 2013 as follows:

· A £33.5 million (loan balance £32.5m 31 December 2015) senior facility with a five-year term expiring in December 2018 and an initial margin of 3% per annum over 3 month LIBOR, with Royal Bank of Scotland ("RBS").

· A £20.0 million (loan balance £19.9m 31 December 2015) mezzanine loan facility with a five-year term expiring in December 2018 and a coupon of 11% per annum, with Europa Mezzanine Finance Sarl ("Europa").

· An £11.5 million (loan balance £10.0m 31 December 2015) unsecured subordinated loan facility with a five-year term expiring in December 2018 and a coupon of 15% per annum with Alpha Real Trust Limited ("ART").

On 27 January 2014, the Group entered into an interest rate swap for the amount of £25.1 million with RBS. The interest rate swap has the effect of fixing the Group's interest rate exposure on £25.1 million of these borrowings from 27 January 2014 until 5 December 2018 at 2.0225% per annum, before the margin of 3% per annum.

During 2015 £2.5m of the net sales proceeds was allocated to amortize the financing agreements.

The overall LTV ratio on total borrowings was 76.3% as at 31 December 2015 (81.0% on total borrowings as at 31 December 2014).

UK Economy

The UK economy has lost some momentum recently due to weaker manufacturing output and global economic uncertainty. In Q4 2015 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 2.2% following four quarters of stable economic expansion.

An increase in demand for labour over the last year has resulted in a fall in the nationwide unemployment rate to 5.1% as at December 2015. This compares favourably with the post-recession high of 8.5% reported at September 2011 and is the lowest rate since August 2005.

Despite a strong labour market, inflation levels remain low. Annual Consumer Price Index ("CPI") rose by 0.2% in the year to December 2015. During the year, prices for transport costs and food and non-alcoholic beverages have had a downward pull on the rate of inflation which was counterbalanced by an increase in goods and services and education costs.

Looking ahead to 2016, inflation looks likely to remain low and most forecasters assume the Bank of England will keep the interest rate policy steady at 0.5%. With low inflation, low interest rates and a favourable labour market, business and consumer demand is expected to continue despite weakening emerging market economies.

Property Commentary

Investors continue to target the UK commercial property market as relatively high and stable income yields are still proving to be attractive. Prime yields have largely stabilised with secondary yields facing further downward pressure due to the lack of availability in Grade A stock.

Rental growth was the principal driver of performance as occupational demand rose for the 12th consecutive quarter. Upward pressure in prime rents and falling lease incentives have been seen across all regions but most notably in the Thames Valley and South East and have been driven by the tight supply in prime assets across the UK.

Investment activity in secondary assets has recently been facilitated by a greater depth and liquidity in the financial markets. A steady flow of new lenders for senior, junior and mezzanine financing are entering the market and providing financing to a wide range of sectors. Non-bank lenders such as debt funds and private equity are increasingly active in the secondary market as they search for higher yield and returns.

Conclusion

The 18.5% increase in adjusted net asset value for the 12 months to 31 December 2015 is encouraging. This increase has been achieved through a combination of improved valuations, property sales at a 49% premium to the most recent valuation, increased occupancy and reducing void costs. Following the refinancing in December 2013 the new mezzanine and sub-ordinated loan facilities carry a comparatively high interest charge which continues to have a negative impact on current earnings. The Investment Adviser and Manager and the Board will continue to review the optimum time to refinance the portfolio. On a property level the 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 the previous twelve months.

Tom Pissarro

Alpha Real Capital LLP

Investment Adviser and Manager

3 March 2016

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. He is Chairman of UCP Plc an AIM listed company. 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, FIM Capital Limited (formerly 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 37 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 30 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 2015. The Corporate Governance Statement set out on pages 11 to15 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.

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 on page 3.

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 (2014: nil).

Corporate governance

The information fulfilling the requirements of the Corporate Governance Statement can be found in this Directors' report and on pages 11 to 15, which are incorporated into this Directors' report by reference.

Directors

Biographical details of the Directors of the Company who served during the year are given on page 8. 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 28 to the consolidated financial statements.

Substantial shareholdings

During the period between 31 December 2015 and 3 March 2016 the Company did not receive any notifications under chapter 5 of the Disclosure and Transparency Rules.

Directors' indemnities

On 4 October 2015, 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 2015 have been prepared on the going concern basis. Further detail on the basis of preparation of the financial statements is provided in note 2.

Geoffrey Black

Director

3 March 2016

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 2015:-

· 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;

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 2015:

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

The directors are responsible for preparing the Annual Report and the group and parent company financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare group and parent company financial statements for each financial year. Under that law they are required to prepare the group financial statements in accordance with IFRSs as adopted by the EU and applicable law and have elected to prepare the parent company financial statements on the same basis.

Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and parent company and of their profit or loss for that period. In preparing each of the group and parent company 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.

Under applicable law and regulations, the directors are also responsible for preparing a Directors' Report and Corporate Governance Statement that complies with that law and those regulations.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website.

Responsibility statement of the directors in respect of the annual financial report

We confirm that to the best of our knowledge:

· the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the company and the undertakings included in the consolidation taken as a whole; and

· the directors' report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

We consider the annual report and accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the group's position and performance, business model and strategy.

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 Financial Reporting Council's guidance on Internal Control, Risk Management and Related Financial and Business Reporting.

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 2015, 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. The principal risks the Group is exposed to are market risk, credit risk and liquidity risk. These risks and details of how they are mitigated are described within note 25.

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.

Directors confirm that they have carried out a robust assessment of the principal risks facing the group, including those that would threaten its business model, future performance, solvency or liquidity.

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 2015 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.

Financial viability statement

The Directors' have assessed the Group's viability over a three-year period to December 2018. This is based on a three year strategic plan and in line with the length of the Group's existing finance facilities.

In making their assessment, the Directors took account of the Group's current financial and operation positions, existing leases and all its long term financing arrangements. We have also assessed the potential financial and operational impacts; in severe but plausible scenarios, of the principal risks and uncertainties set out in note 25 and the likely degree of effectiveness of current and available mitigating actions.

Based on this assessment, the Directors have a reasonable expectation that the Group will be able to continue in operation and meet all their liabilities as they fall due up to December 2018.

In making this statement, the Directors have also made the following key assumptions:

· funding in the form of senior and junior or mezzanine financing will be available in all plausible market conditions;

· the refinancing of the existing junior and mezzanine facilities can be made in all plausible market conditions at or before their maturity in December 2018;

· any significant decrease in its commercial property values will be temporary and part of the normal property cycle;

· the portfolio will maintain its significant diversification of tenants.

Geoffrey Black

Director

3 March 2016

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 on page 8. 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 2015 they met on two 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 2015 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

The significant areas considered by the Committee and discussed with the external auditors during the year were:

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 the current RICS Appraisal and Valuation Standards.

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

In December 2013, the Group entered into new long term loan facilities and the Committee considered whether the Group could service this debt. At the year end the Committee alongside the external auditor has reviewed a three year forecast and is satisfied that the terms of the loan facilities can be satisfied.

Related party transactions outside the normal course of business

In December 2013, the Group entered into a long term loan facility with Alpha Real Trust Limited. The Committee reviewed the agreement and the terms of the loan and was satisfied that the agreement had been properly documented, authorised and that the terms are commercially acceptable.

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 its first external audit for the year ended 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.

Total fees payable to KPMG Audit LLC for audit services relating to the current financial year amounted to £54,000 and no fees in respect of non-audit services were paid during the year.

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 as endorsed by the EU, 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 issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

On behalf of the Board,

Geoffrey Black Philip Scales

Director Director

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 2015 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 2015 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 (£81.6 million)

Refer to page 16 (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 93.8% 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;

· 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; and

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

Going concern: debt service and covenant compliance (Borrowings: £61.1m)

Refer to page 16 (Audit Committee Report), note 2 (accounting policy for basis of preparation) and note 23 (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;

· assessing 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 £320,000. 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 £16,000, 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 on the disclosures of principal risks

Based on the knowledge we acquired during our audit, we have nothing material to add or draw attention to in relation to:

· the directors' statement of long-term viability statement on page 15 concerning the principal risks, their management, and, based on that, the directors' assessment and expectations of the group's continuing in operation over the three-year period to 2018; or

· the disclosures in note 2 of the financial statements concerning the use of the going concern basis of accounting

5. 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.

Under the Listing Rules we are required to review:

· the statements, set out on pages 3, and 9 to 18, in relation to going concern and longer-term viability; and

· the Corporate Governance Statement on pages 11 to 15 relating to the Company's compliance with the eleven provisions of the 2014 UK Corporate Governance Code specified for our review.

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 set out on page 13, 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

All results are considered to derive from continuing operations. There are no other items that require disclosure in the consolidated statement of comprehensive income.

The accompanying notes on pages 31 to 60 are an integral part of these financial statements.

These financial statements were approved by the Board of Directors on 3 March 2016 and signed on its behalf by:

The accompanying notes on pages 31 to 60 are an integral part of these financial statements.

.

Consolidated and Company statement of changes in equity

The accompanying notes on pages 31 to 60 are an integral part of these financial statements.

Consolidated statement of cash flows

Disclosed on the balance sheet as:

The accompanying notes on pages 31 to 60 are an integral part of these financial statements.

Company balance sheet

These financial statements were approved by the Board of Directors on 3 March 2016 and signed on its behalf by:

The accompanying notes on pages 31 to 60 are an integral part of these financial statements.

The accompanying notes on pages 30 to 60 are an integral part of these financial statements.

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 endorsed by the EU and also to comply with relevant Isle of Man company law.

On 5 December 2013, the Company and Group entered into 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").

· an £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 2015.

· 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. No cash inflows from property sales included.

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, and that its loan facilities are not due for repayment until December 2018, the Board considers it appropriate to prepare the Group and Company financial statements on a going concern basis.

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. The Company made a profit of £3.6 million (2014: £0.3 million) on ordinary activities after taxation.

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.

· 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 Group's bank accounts, but not under the Group'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 sectors, split into industrial and office properties 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 deductible 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.

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, 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 borrowing facilities with RBS, Europa and ART 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.

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.

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.

Annual improvements to certain standards apply for the first time in 2015. However, they do not impact the annual consolidated financial statements of the Group;

IFRS 2 Share-based payment - definition of 'vesting condition';

IFRS 3 Business combinations - classification and measurement of contingent consideration;

IFRS 8 Operating segments - disclosures on the aggregation of operating segments;

IFRS 13 Fair value measurement - measurement of short-term receivables and payables;

IAS 16 Property, plant and equipment and IAS 38 Intangible assets - restatement of accumulated depreciation (amortisation) on revaluation;

IAS 24 Related party disclosures - definition of 'related party'.

IFRS 1 First-time adoption of International Financial Reporting Standards - IFRS version that a first-time adopter can apply;

IFRS 3 Business combinations - scope exclusion for the formation of joint arrangements;

IFRS 13 Fair value measurement - scope of portfolio exception;

IAS 40 Investment property - inter-relationship of IFRS 3 and IAS 40.

(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.

This cycle of improvements contains amendments to the following four standards.

IFRS 5 Non-current Assets Held for Sale and Discontinued Operations - Changes in method for disposal

IFRS 7 Financial Instruments: Disclosures 'Continuing involvement' for servicing contracts. Offsetting disclosures in condensed interim financial statements

IAS 19 Employee Benefits - Discount rate in a regional market sharing the same currency - e.g. the Eurozone

IAS 34 Interim Financial Reporting - Disclosure of information 'elsewhere in the interim financial report'

IAS1 Disclosure Initiative- Amendments to IAS 1 on presentation of financial statements should not require any significant change to current practice, but should facilitate improved financial statement disclosures.

IFRS 9 Financial Instruments: Classification and Measurement

First chapters of 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.

IFRS 15 Revenue from Contracts with Customers

The standard replaces IAS 11 Construction Contracts, IAS 18 Revenue, IFRIC 13 Customer Loyalty Programmes, IFRIC 15

Agreements for the Construction of Real Estate, IFRIC 18 Transfer of Assets from Customers and SIC-31 Revenue -Barter Transactions Involving Advertising Services.

It applies to contracts with customers but does not apply to insurance contracts, financial instruments or lease contracts, which fall in the scope of other IFRSs. It also does not apply if two companies in the same line of business exchange non-monetary assets to facilitate sales to other parties.

The standard introduces a new revenue recognition model that recognises revenue either at a point in time or over time. The model features a contract-based five-step analysis of transactions to determine whether, how much and when revenue is recognised.

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 23. 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 dilapidations negotiated and collected by the Investment Adviser and Manager on behalf of the Group. The amount is excess over expenditure.

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

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 20%. 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 Group 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 2015, the Group had unused tax losses and capital allowances of £11.1 million

(31 December 2014: £10.1million).

14 Dividends

The Company paid no dividends during the year (2014: £nil).

15 Earnings per share

15

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.

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 2015 and 2014 had net liabilities, therefore the original cost of the investment held in the parent company has been fully impaired.

As at 31 December 2015, 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

IFRS 13 defines fair value as 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 fair value of the Group's investment property at 31 December 2015 and 31 December 2014 has been arrived at on the basis of valuation carried out at that date by Cushman and Wakefield (formerly DTZ Debenham Tie Leung), independent valuers not connected with the Group. The valuation, which was carried out in accordance with the Royal Institution of Chartered Surveyors ("The Red Book") Appraisal and Valuation Standards (9th Edition 31 January 2015), was arrived at by reference to market evidence of transaction prices for similar properties, together with valuation techniques consistent with those used in the 31 December 2014 valuation. The valuation model is based on comparable market evidence derived from observable market data, derived from an active and transparent market adjusted with certain unobservable inputs as disclosed below. The properties were valued individually. These valuation models are consistent with the principles in IFRS 13.

Valuations are based on what is determined to be the highest and best use. When considering the highest and best use a valuer will consider, on a property by property basis, the highest value which will include its actual and potential uses given current market conditions. Where the highest and best use differs from the existing use, the valuer will consider the cost and the likelihood of achieving and implementing this change in arriving at its valuation.

19

Property pledged as security

The Group has pledged investment properties valued at £81.6 million at 31 December 2015 (31 December 2014: £79.9 million) to secure borrowings (note 23).

The table below presents the sensitivity of the valuation to changes in the most significant assumptions underlying the valuation on completed investment properties:

Market value is based on active market information, adjusted for any difference related to the nature, location and condition of the specific asset. Where information is not available, alternative valuation methods are used, such as recent prices of similar properties in less active markets, with adjustments to reflect any changes in economic conditions since the date of the transactions that occurred at those prices, or discounted cash flow projections. The principal assumptions underlying the estimation of market value are those related to the receipt of contracted rental income, expected future market rental income, void periods, lease incentives, maintenance requirements and appropriate yields/discount rates of previous quarters.

These valuations are regularly compared to actual market yield data and actual transactions by the Group and those reported by the market. The valuer looks at each individual property on its merits.

The valuation reports produced by the valuers are based on information provided by the Group such as current rents, terms and conditions of lease agreements, service charges and capital expenditure. In

addition, the valuation reports are based on assumptions and valuation models used by the valuers. The assumptions are typically market related, such as yields and discount rates, and are based on their professional judgment and market observation.

Valuation process

The Investment Adviser and Manager verifies all major inputs to the valuation reports, assesses the individual property valuation changes from the prior valuation report and holds discussions with the valuers. When this process is complete, the valuation report is communicated to the Board, which considers it as part of its overall responsibilities.

In categorising which level of the fair value hierarchy applies to the Group's investment properties, consideration is given to the inputs used by the Group's valuer in determining the fair value. As mentioned above observable market data such as transactions involving similar properties and the information provided by the Group is used in determining the fair value. In addition there are also a number of unobservable inputs including the estimated rental value, net initial yield, net reversionary yield, state and condition, void periods and the related void rate charges, letting incentives and related letting charges such as marketing and legal costs which are considered by the valuer.

Impact on fair value to changes in significant unobservable inputs

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy of the Group's property portfolio, together with the impact of significant movements in these inputs on the fair value measurement, are shown below: