Half Yearly Report

24 AUGUST 2011

ALPHA UK MULTI PROPERTY TRUST PLC(THE "COMPANY" OR THE "GROUP" )

ALPHA UK MULTI PROPERTY TRUST PLC POSTS RESULTS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2011:

NET ASSET VALUE PER SHARE 31.8 PENCE; LOSS PER SHARE OF 1.7 PENCE

Alpha UK Multi Property Trust PLC, the property company investing primarily in commercial real estate in the UK, today posts its results for the six month period from 1 January to 30 June 2011.

The Company announced losses of £1.4 million for the six month period and a loss per share of 1.7 pence.

Key achievements in 2011:

·; New lettings - 32 new lettings and 13 lease renewals completed during the period.

·; Additional contracted rent - £0.6 million per annum of additional rent is due to start during the next two years.

·; Gearing reduced - borrowings reduced by £1.4 million to £80.6 million; loan to value ('LTV') ratio on secured debt reduced from 73.2% to 72.9%.

·; Occupancy stabilised -the void level stood at 22.7% on 30 June 2011 compared to 22.8% as at 31 December 2010.

·; Share consolidation - became effective on 1 July 2011 achieving the effect of reducing the bid/offer spread by nearly five times and a share price increase of around 18%.*

·; New management - Alpha Real Capital LLP ("Alpha") has been appointed Property Investment Adviser ("PIA") and has increased the management resources available to the Group, including a new fund manager.

·; New capital - the Group has raised £4.75 million, increasing the ability to invest in its property portfolio, particularly to target new and retain existing tenants through selective capital expenditure.

·; Portfolio review - Alpha is undertaking an extensive review of the property portfolio to identify value enhancement opportunities.

Key performance objectives for 2011:

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

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

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

Tom Pissarro, Fund Manager, Alpha Real Capital LLP, commented:

"The occupational market remains challenging. However, real progress continues to be made with the letting up of vacant units: 32 new lettings and 13 lease renewals were completed during the review period, with a further 20 units currently under offer. Many of the new leases incorporate stepped rents and there is an additional £0.6 million per annum of contracted rent due to start during the next two years."

Contact:

Jonathan ClagueChairman, Alpha UK Multi Property Trust PLCTom PissarroFund Manager, Alpha Real Capital LLP 020 7268 0300

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

For more information on the Company's Property Investment Adviser 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.

ALPHA UK MULTI PROPERTY TRUST PLC

CHAIRMAN'S STATEMENT

ALPHA UK MULTI PROPERTY TRUST PLCRESULTS FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2011

I am pleased to present the Half Year Report and the Condensed Consolidated Financial Statements of Alpha UK Multi Property Trust PLC ("Company" or "Group") for the six month period ended 30 June 2011.

Property performance

Progress continues to be made in actively managing the properties. The void levels across the portfolio have reduced during the period from 22.8% to 22.7% at a time when the weak economic environment presents challenges for tenant occupancy.

We were pleased to report the successful sale in February 2011 of two units at Shadsworth Industrial Park, Blackburn for £0.7 million. This sale was achieved at a premium of approximately 23% above the 31 December 2010 valuation of the two units.

The portfolio valuation on a like for like basis fell by £1.1 million (1.0%) to £110.6 million at 30 June 2011. A full evaluation of the performance of the portfolio is in the Property Investment Adviser Report.

Share Consolidation

At the Company's Annual General Meeting on 30 June 2011 the shareholders approved an extraordinary resolution proposing a 1 for 10 consolidation of the Company's Ordinary shares.

The share consolidation became effective on 1 July 2011 achieving the effect of reducing the bid/offer spread that the shares trade in the market by nearly five times. The traded share price also saw a positive effect with an increase of around 18%. It is hoped that these initiatives when combined with other performance initiatives undertaken by the Group will continue to improve the market for the trading of the shares and reduce the discount at which the shares trade relative to the Net Asset Value per share.

The earnings per share and net asset value per share reported within the Half Year Report and the Condensed Consolidated Financial Statements are based on the ordinary shares in issue as at 30 June 2011 and therefore do not take into account the share consolidation which became effective on 1 July 2011.

Net asset value and earnings

The condensed consolidated loss of the Group for the period was £1.4 million with a loss per ordinary share of 1.7 pence. The Company's Net Asset Value per ordinary share has decreased during the period by 5.1% from 33.5 pence to 31.8 pence. This fall is mainly attributable to the revaluation of investment properties in the period.

Debt facilities

During the period the Group has continued its progress on reducing debt and improving its financial position. Debt of £1.4 million has been repaid during the period, reducing the Group's borrowings from £82.0 million at 31 December 2010 to £80.6 million at 30 June 2011, reducing the Group's loan to value ratio on secured borrowings from 73.2% to 72.9%.

The Group's interest costs have reduced significantly during the period as a result of debt repayments since April 2010 and the successful re-hedging of the Group's interest rate swaps with the Bank of Scotland in December 2010. Interest and finance costs for the period ended 30 June 2011 have reduced by 17.0% when compared with the level for the 2010 period.

Further details on the Group's borrowings are provided in Note 8 to the financial statements.

Outlook

The Group's strategy of focusing on preserving and improving the profile of the income from its property portfolio, should place the Group in a stronger position to obtain acceptable refinancing terms when its principal loan facilities are due to be renegotiated in late 2012. The continuing reduction of borrowings from cash flow going forward is a key part of this strategy.

The Board believes that the Group's strategy provides a strong platform from which to build shareholder value over the medium term.

Jonathan Clague

Chairman

23 August 2011

ALPHA UK MULTI PROPERTY TRUST PLC

PROPERTY INVESTMENT ADVISER'S REPORT

The Property Investment Adviser's strategy to deliver shareholder value will continue to focus on the following:-

1. To enhance net rental income - the marketing strategy for vacant units will focus on meeting tenant requirements for good quality affordable accommodation on flexible lease terms.

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

3. To undertake limited strategic sales - a disposal will be considered where it is believed that the price likely to be achieved is accretive to shareholder returns having considered the current yield and the future realisable capital value. As previously reported Units C & D, Shadsworth, Blackburn, a vacant light industrial property, were sold to an owner occupier in February 2011 at £0.7 million, £0.1 million above the 31 December 2010 valuation.

4. To reduce borrowings through rental surplus and to reduce the LTV ratio - both the Bank of Scotland and Nationwide facilities require all rental surplus to be used to pay down the respective loans. Subject to achieving improved occupancy levels and higher market value the LTV ratios can be significantly improved in the medium term.

The strategy to concentrate on active asset management initiatives within the portfolio offers real opportunities to generate strong positive cash flow in the future.

Portfolio overview

The portfolio predominantly comprises a well diversified portfolio of 64 UK multi let, light industrial and office properties with 747 leasable units. The total floor area is 191,700 square metres (2.06 million square feet) and the portfolio has a broad sector split by value, of approximately 56% light industrial, 35% offices, 8% industrial and office properties, and 1% retail. The properties offer good value accommodation for local and regional occupiers 

Tenants have continued to favour shorter term flexible leases and the weighted average lease length is 4.2 years to expiry and 2.7 years to the next tenant break.

Asset management review

The occupational market remains challenging. However, real progress continues to be made with the letting up the vacant units: 32 new lettings and 13 lease renewals were completed during the review period, with a further 20 units currently under offer. Many of the new leases incorporate stepped rents and there is an additional £0.6 million per annum of contracted rent due to start during the next two years.

It is encouraging that occupancy has now stabilised. The void level stood at 22.7% on 30th June 2011 compared to 22.8% as at 31st December 2010. Tenant insolvency has also improved significantly with only 7 tenants defaulting during the review period compared to 32 during the previous year. Based on the current estimated rental value 'ERV', there is a potential additional rent of £3.6 million per annum. Should these positive trends continue there is a real opportunity to increase long term occupancy and enhance rental income in the near future.

*Final achievable annual rent including stepped rents.

On a like for like basis, excluding the two units which were sold in February, the valuation of the portfolio has decreased by £1.1 million (1.0 %). The average capital value of the portfolio is £580 per square metre (£54 per square foot). Despite this fall in value, the overall LTV (loan to value) ratio for bank borrowing has improved to 72.9% (LTV as at 31 December 2010 was 73.2%).

Financing

The loan facilities with Bank of Scotland and Nationwide (in respect of CHIP (Two) Limited) were successfully refinanced. The combined LTV under these facilities is 68.2% as at 30 June 2011.

Positive discussions continue with Nationwide in respect of CHIP (Six) Limited. The Board believes that a formal agreement to resolve the breach of covenants is achievable. It is important to note that, whilst CHIP (Six) Limited accounts for 18.4% of the portfolio value, due to the relatively high level of gearing, the NAV represents only 2.5% of the Group NAV. CHIP (Six) Limited's borrowings are not cross collateralised with any other Group borrowings or subject to any Group guarantees.

UK Economy

In the UK GDP grew by 0.7% in the first two quarters of 2011, an increase of 0.8% over the preceding twelve month period, according to the Office for National Statistics (ONS). Whilst the manufacturing, services and construction sectors continue to expand, the latest Market PMI survey suggests a reduction in the rate of growth.

Inflation continues to be above the MPC's 2% target. The underlying domestic inflationary pressure however, has not led the Bank of England to raising base rate at this stage.

The June consensus forecasts, published by the Treasury, indicate continued modest GDP growth in the UK, over the next two years. However, this prediction should be considered in the context of an uncertain world economic climate.

Commercial property overview

During the review period the UK Commercial Property Market saw a continuing recovery, although this has not been evenly experienced across all property types.

The key trends in this recovery have been investor preference for prime rather than secondary assets and a preference in property located in London and the South East. Accordingly, the Group's properties which are not located in these regions have yet to benefit from the recovery. As in previous recoveries, compression of prime yields has often been a precursor to improved investor sentiment towards secondary assets. It is encouraging that there are increasing signs of investor interest in a wider range of assets and locations.

Conclusion

The Board believes that the Company's financial position, following the refinancing and new capital introduced last year has been significantly strengthened and the Company holds significant cash with which to undertake targeted income and value enhancement asset management initiatives in the year ahead.

Tom Pissarro

Alpha Real Capital LLP

Property Investment Adviser

23 August 2011

ALPHA UK MULTI PROPERTY TRUST PLC

INDEPENDENT AUDITORS' REPORT TO THE SHAREHOLDERS OF ALPHA UK MULTI PROPERTY TRUST PLC

For the six month period ended 30 June 2011

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the half year financial report for the six months ended 30 June 2011 which comprises the condensed consolidated statement of comprehensive income, condensed consolidated statement of financial position, condensed consolidated statement of changes in equity, condensed consolidated statement of cash flow and the related notes 1 to 15. We have read the other information contained in the half yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusions we have formed.

Directors' Responsibilities

The half year financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half year financial report in accordance with the rules of the London Stock Exchange.

As disclosed in note 2, the annual financial statements of the company are prepared in accordance with IFRS. The condensed set of financial statements included in this half year financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting".

Our Responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half year financial report based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review consists of making enquiries of persons responsible for financial reporting and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified during an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half year financial report for the six months ended 30 June 2011 is not prepared, in all material respects, in accordance with International Accounting Standard 34.

Ernst & Young LLC

Chartered accountants

Douglas

Isle of Man

23 August 2011

ALPHA UK MULTI PROPERTY TRUST PLC

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six month period ended 30 June 2011

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

ALPHA UK MULTI PROPERTY TRUST PLC

CONDENSED CONSOLIDATED BALANCE SHEET

As at 30 June 2011

These financial statements were approved by the Board of Directors on 23 August 2011 and signed on its behalf by:

J D Clague

D Lake

ALPHA UK MULTI PROPERTY TRUST PLC

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

As at 30 June 2011

ALPHA UK MULTI PROPERTY TRUST PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

As at 30 June 2011

The capital reserve includes the distributable capital reserve.

ALPHA UK MULTI PROPERTY TRUST PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the six month period ended 30 June 2011 (continued)

1. Operations

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 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 condensed consolidated balance sheet has been changed from the last annual financial statements in order to present the Net Asset Value of the Group more clearly to investors.

Taxation

There was no taxation charge for the period as the Group had sufficient unused tax losses and capital allowances to offset any taxable profit. As at 30 June 2011 the Group had unused tax losses and capital allowances of £11.2 million (30 June 2010: £11.0 million, 31 December 2010: £11.0 million).

Going concern

The half year report and condensed consolidated financial statements have been prepared on the going concern basis. At 30 June 2011 and up to the date of the signing of these financial statements CHIP (Six) Limited remained in breach of the financial covenants under its loan facility with Nationwide. The Board remains confident that an agreement with Nationwide will be satisfactorily concluded to remedy this breach. In the event that Nationwide enforced its rights under the facility, the Group would continue to be a going concern as the Company and the Group would continue in operation without CHIP (Six) Limited. See Note 8 for further information on the Group's borrowing arrangements.

2. Summary of significant accounting policies

Basis of preparation

The unaudited condensed half year financial statements for the six months to 30 June 2011 have been prepared in accordance with IAS 34: Interim Financial Reporting.

The half year condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Group's annual financial statements for the year ended 31 December 2010.

The accounting policies adopted in the preparation of the half year condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2010.

3. Changes and future changes in accounting standards

The accounting policies adopted in the preparation of the condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2010, except for the adoption of amended, improved and new standards and interpretations detailed below.

Amendments to the following standards were adopted with effect from 1 January 2011:

·; IAS 24 Related Party Transactions

·; IAS 32 Financial Instruments: Presentation

·; IFRIC 14 Prepayments of a Minimum Funding Requirement

Improvements to the following standards were adopted during the period as follows:

·; IFRS 3 Business Combinations

·; IFRS 7 Financial Instruments - Disclosures

·; IAS 1 Presentation of Financial Statements

·; IAS 34 Interim Financial Statements

·; IFRS 3 Business Combinations

·; IAS 27 Consolidated and Separate Financial Statements

·; IFRIC 13 Customer Loyalty Programmes

The adoption of the amendments and improvements to the standards and interpretations has had no effect on the accounting policies, financial position or performance of the Group.

3. Changes and future changes in accounting standards (continued)

The following new standards have been issued but are only effective for periods beginning on or after 1 January 2013:

·; IFRS 9 Financial Instruments: Classification and Measurement

·; IFRS10 Consolidated Financial Statements

·; IFRS 11 Joint Arrangements

·; IFRS 12 Disclosure of Interests in Other Entities

·; IFRS 13 Fair Value Measurement

The Directors anticipate minimal impact from the adoption of the new standards with the exception of the adoption of IFRS 9 and IFRS 13. The Directors are currently assessing any potential impact these two standards may have on the accounting policies, financial position and performance of the group.

4. Investment properties

All properties were independently valued as at 30 June 2011 by the Company's valuers DTZ Debenham Tie Leung Limited ("DTZ"). DTZ is an accredited independent valuer with a recognised and relevant professional qualification and with recent experience in the location and category of the investment properties being valued. All properties were valued on the basis of market value, as defined by the Royal Institute of Chartered Surveyors (RICS), and are valuation techniques consistent with those used in the December 2010 valuation. The properties were valued individually.

During the period there has been a change to the methodology used in calculating realised gains and losses. Previously it was calculated based on the original cost of the property but going forward it shall be based on the latest valuation. There is no impact on the comparative periods as there were no disposals.

5. Trade and other receivables

Payment terms for rental debtors are typically quarterly in advance.

As at 30 June 2011, receivables with a value of £0.1 million (31 December 2010: £0.1 million) were impaired and fully provided for. £0.1 million has been utilised during the period (31 December 2010: £0.1 million) and a provision of £0.1 million (31 December 2010: £0.1 million) has been made as at the period end.

6. Property Investment Adviser fee

The Group pays a fee of 1.25% of gross asset value to the Property Investment Adviser. The Group has historically capitalised 60% of the total fee. The policy is now to fully expend this cost in the income statement. The total fee paid for the period to 30 June 2011 was £0.8 million (30 June 2010: £0.8 million).

An incentive arrangement will come into effect either upon the Shareholders voting to continue or wind up the Group at a meeting of the Company to be held on or after 30 June 2013. At that time if the annual rate of return has been 15 per cent or more for the period from 10 August 2010 until 30 June 2013, then Alpha Real will be entitled to 20 per cent of the excess above that target level of return.

No incentive fee is provided for at 30 June 2011 (30 June 2010: £nil) as the target level of return to Shareholders was not achieved.

7. Convertible unsecured loan stock

The Company accounts for CULS as a compound financial instrument, which comprises a liability and equity component. The liability component is presented within the non-current liabilities section and the equity component is included within the equity section of the condensed consolidated balance sheet.

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 per cent was determined by reference to similar mezzanine lending transactions at that time.

The table shows the initial issue of CULS including associated issue costs, followed by the subsequent issue of CULS in satisfaction of interests payments, the accrual for the 18 per cent premium and the amortisation of the associated issue costs.

The CULS bears interest at the rate of 4.75 per cent per annum payable quarterly, in arrears, on a compounded basis on 1 January, 1 April, 1 July and 1 October. The first date for payment of interest was 1 October 2010. The Company may, at its sole discretion, choose to satisfy any interest payment in cash or by the issue of further CULS.

The CULS can be converted to ordinary shares at any time on or before 30 June 2013 at a price of £0.31 per share.

If the CULS are not converted the Company shall redeem any outstanding CULS (together with any CULS issued in satisfaction of interest payments) on 30 June 2013 in full at par plus a payment of a premium of 18 per cent.

8. Bank borrowings

Nationwide Building Society loans

A facility agreement has been entered into between the Nationwide Building Society ("Nationwide") and Chip (Two) Limited whereby Nationwide has made available a term loan facility for up to £9.8 million. Of this total loan £8.0 million has been fixed at the rate of 2.79% plus a margin of 2.5% per annum; the balance is subject to interest at LIBOR plus a margin of 2.5% per annum. The facility is repayable on 23 October 2012. An event of default (as defined in the facility agreement) is triggered if, inter alia, the amount of the loan facility exceeds 75% before 31 March 2011 and 65% thereafter of the value of the properties over which Nationwide has security. In addition, the ratio of gross rental income to interest shall not be less than 160%. The facility is secured by a legal charge and debenture over the property assets of Chip (Two) Limited. As at 30 June 2011 the LTV stood at 64.39%. The facility requires Chip (Two) Limited to use surplus rents to reduce the outstanding debt on a quarterly basis. Surplus rent of £0.3 million has been used to repay the facility during the period.

A facility agreement has been entered into between Nationwide Building Society and Chip (Six) Limited whereby Nationwide Building Society has made available a term loan facility for up to £18.9 million. Of this loan balance £18.0 million has been fixed at the rate of 2.79% plus a margin of 3.5% per annum. The balance is subject to interest at LIBOR plus a margin of 3.5% per annum. The facility is repayable on 1 March 2013. An event of default (as defined in the facility agreement) is triggered if, inter alia, the amount of the loan facility exceeds 90% before 31 March 2012 and 85% thereafter of the value of the properties over which Nationwide has security. In addition, the ratio of net rental income to interest shall not be less than 110% for any test period. The facility requires Chip (Six) Limited to use surplus rents to reduce the outstanding debt on a quarterly basis. The facility is secured by a legal charge and debenture over the property assets of Chip (Six) Limited.

Following the DTZ valuations of the properties as at 30 June 2011 the LTV ratio of CHIP (Six) Limited stands at 91.56% against a covenant of 90.00%. The Directors continue to be in discussion with Nationwide and are confident they shall reach an agreement to redress the breach. This does not impact on the going concern status of the Group or Company.

In addition Chip (Two) Limited and Chip (Six) Limited were required to deposit £0.2 million and £0.3 million respectively in a blocked account over which Nationwide has sole signing rights. Withdrawals from these blocked accounts will be permitted only at Nationwide's sole discretion. The funds placed in these blocked deposit accounts have been included in "Cash and Cash Equivalents" in the condensed consolidated balance sheet.

On 10 July 2011 the Group paid £0.1 million to Nationwide in respect of the quarterly repayment of debt from surplus rent for its subsidiaries, CHIP (Two) Limited and CHIP (Six) Limited. These repayments reduced the outstanding debt under the loan facility to £9.2 million and £18.8 million respectively.

8. Bank borrowings (continued)

Bank of Scotland loans

The facility is between the Bank and the Company and its subsidiaries, Chip (One) Limited, Chip (Three) Limited, Chip (Four) Limited and Chip (Five) Limited for an amount up to £54.1 million.

Interest is payable at a rate equal to LIBOR, plus the mandatory costs of Bank of Scotland, plus a margin of 2.6% per annum. The facility is repayable on 31 October 2012 although, if an event of default (as defined in the facility agreement) were triggered, it would be repayable on first demand by Bank of Scotland. The facility agreement contains standard events of default and covenants for bank facilities of this nature. An event of default (as defined in the facility agreement) will be triggered if, inter alia, the amount of the loan facility exceeds 90% of the value of the underlying security. The facility is secured by a legal charge and debenture over the property assets of the relevant subsidiaries. As at 30 June 2011 the LTV stands at 69.23%

Other financial covenants require that the net rental income of the secured properties shall not be lower than 125% of interest for any test period. The Company is required make quarterly loan repayments of £0.2 million.

Should any of these covenants be breached then the margin of the new funding will increase by a further 2.6% per annum and will remain at this rate until such a time the breach is remedied.

On 16 July 2011 the Group paid £0.2 million to Bank of Scotland as its quarterly repayment of debt under the loan facility. This repayment reduced the outstanding debt under the loan facility to £52.4 million.

9. Interest rate hedging instruments

The Group uses interest rate hedging arrangements to mitigate its exposure to interest rate changes. There has been no change to the hedging arrangements during the period.

The Directors have elected not to apply hedge accounting rules under IAS 39 on the new hedging arrangements. Any gains or losses in the value of these derivatives are recognised immediately in the Condensed Consolidated Statement of Comprehensive Income.

10. Trade and other payables

Trade payables are non-interest bearing and are settled within normal business terms.

11. Share capital and related reserves

An option has been granted to Alpha Tiger enabling it to purchase 4 million Ordinary Shares at £0.50 per share. The current fair value of this option is deemed to be insignificant due to the fact the current quoted price and NAV per share is below the option value of £0.50 per share.

Preference shares

The preference shares rank pari passu with ordinary shares save that they shall not be entitled to receive a dividend, on return of capital their par value shall be repaid in priority to holders of the ordinary shares (but shall not be entitled to any other capital return) and shall carry one vote on all resolutions other than those relating to listing or prospectus rules. Based on this the preference shares do not meet the criteria under IAS 32 in order to be classified as equity and therefore have been classified as a financial liability and included with trade and other payables.

Voting and other rights

Holders of Ordinary Shares and Preference Shares are entitled to one vote for each share held. Deferred shares and preference shares carry no voting rights.

Dividends

Holders of Ordinary shares are entitled to receive dividends as and when declared by the Company.

Winding up

On a winding-up, the surplus assets remaining after payment of all creditors, including payment of bank borrowings and repayment of par value to Preference Share holders, shall be divided pari passu among the holders of Ordinary Shares in proportion to the capital paid up on the shares held at the commencement of the winding-up. Deferred shares holders will be entitled to an amount equal to their nominal holding.

11. Share capital and related reserves (continued)

Distributable capital reserve

This is a distributable reserve out of which distributions can be made to the shareholders and arose on the cancellation of the share premium account.

Capital redemption reserve

This is a non-distributable reserve that is required under Isle of Man Companies Act 1931 and arises on cancellation of issued share capital.

12. Earnings per share

The earnings per share is based on the net loss for the period in the sum of £1.4 million and on 84,095,065 Ordinary shares, being the weighted average number of Ordinary shares in issue during the period. The comparative figure for 30 June 2010 is based on the net profit for the period in the sum of £2.5 million and on 84,095,065 shares being the total number of shares that were in issue during the period.

The issue of CULS in August 2010 (see note 7) with the potential future conversion into ordinary shares does not result in any material dilution in the earnings per share.

13. Segmental analysis

Rental income - segmental analysis*

* The rental information reviewed by the Board is in the form of the annual rent passing at the period 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 reviewed by the Board is adjusted here to agree with the rental income in the condensed consolidated income statement. For disclosure purposes the above tables reconcile 50% of the annual passing rent as at 30 June 2011 to the rental income within the condensed consolidated statement of comprehensive income.

13. Segmental analysis (continued)

Property valuation - segmental analysis

The Board considers the sector and region analysis above to be the significant segmental basis for the Group. The information disclosed in this note has changed from prior year in order to present more clearly to shareholders 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. Bank loans are reviewed on a facility basis as per note 8. 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.

14. Related party transactions

Mr Philip Scales, a director of the Company, is also a director and an employee of IOMA Fund and Investment Management Limited (the administrator and registrar). During the period fees of £0.1 million (30 June 2010: £0.1 million, 31 December 2010: £0.1 million) were payable to IOMA Fund and Investment Management Limited. As at 30 June 2011 a total amount of £33,353 (30 June 2010: £25,329, 31 December 2010: £29,146) was outstanding.

Mr Phillip Rose, a director of the Company, is also chief executive officer of Alpha Real Capital LLP (the Property Investment Adviser). During the period fees of £0.8 million (30 June 2010: nil, 31 December 2010: £0.5 million) were payable to Alpha Real Capital LLP. As at 30 June 2011 a total amount of £0.7 million (30 June 2010: nil, 31 December 2010: £0.4 million) was outstanding. Mr Rose is also a director of Alpha Tiger Property Trust Limited ("Alpha Tiger"). Alpha Real Capital LLP is also a major investor in Alpha Tiger. During the period the Company issued £0.1 million of convertible unsecured loan stock and attached preference shares to Alpha Tiger as detailed note 7.

15. Events after balance sheet date

At the annual general meeting of the Company held on 30 June 2011, shareholders approved the extraordinary resolution for a 1 for 10 consolidation of the Company's ordinary shares. The resolution was approved by 99% of shareholders voting. The share consolidation became effective on 1 July 2011 and reduced the ordinary shares in issue to 8,409,520 shares.

On 10 July 2011 the Group paid £0.1 million to Nationwide in respect of the quarterly repayment of debt from surplus rent for its subsidiaries, CHIP (Two) Limited and CHIP (Six) Limited. These repayments reduced the outstanding debt under the loan facility to £9.1 million and £18.8 million respectively.

On 16 July 2011 the Group paid £0.2 million to Bank of Scotland as its quarterly repayment of debt under the loan facility. This repayment reduced the outstanding debt under the loan facility to £52.4 million.