Interim Management Statement

INVISTA EUROPEAN REAL ESTATE TRUST SICAF ("IERET" or the "Company")

ANNOUNCEMENT OF NAV AND INTERIM MANAGEMENT STATEMENT

FOR THE QUARTER ENDED 30 SEPTEMBER 2013

31 January 2014

Net Asset Value

As at 30 September 2013, the Company's unaudited Net Asset Value calculated using International Financial Reporting Standards and adjusted to add back the change in fair value of the warrants and deferred tax was €0.246 (£0.206) per share, reflecting an increase of €0.010 or 3.91% over the quarter and £0.013 or 5.94% in Sterling. Please note that the audited NAV as at 30 September 2013 is disclosed in the Full Year Results.

A breakdown of the unaudited Net Asset Value is set out below:

1 Net assets include in June 2013 a reclassification of an asset held for sale and liabilities attributable to it.

2 Senior debt in June 2013 has been reduced by €1.0 million further to a reclassification as "liabilities attributable to the asset held for sale".

3 Net Asset Value adjusted to add back deferred tax (both current and non-current liabilities) and change in fair value of the warrants from book value.

4 Assumes all warrants are exercised at 29p per share and that the fully diluted number of ordinary shares is 289,086,083.

5 The NAV for preference shares is equal to the nominal value plus accrued interest divided by the total number of preference shares.

6 As at 30 September 2013, deferred tax liabilities of €17.9 million, based upon temporary differences at the time of initial recognition arising from transactions treated as asset acquisitions have not been recognised in accordance with IAS 12. The Group has deferred tax assets of €17.2 million which also have not been recognised.

The Net Asset Value incorporates a number of events and key factors during the quarter ended 30 September 2013 including:

· The property valuation has decreased on a like-for-like basis by €3.3 million or €0.01 per share.

· The logistic asset at Châteuneuf-de-Gadagnes, France has been sold this quarter for gross sale proceeds of €3.5 million.

· A decrease of the market value of the swap by €2.8 million or €0.01 per share.

· A decrease of the senior debt amount by €0.05 per share is due to an over amortisation payment following the sale of one French asset and a further loan repayment of €11.9 million from the existing cash balances.

The Company's Net Asset Value figure incorporates the independent property portfolio valuation as at 30 September 2013. The property portfolio will next be valued on 31 December 2013.

Figures converted into sterling assume a EUR per GBP exchange rate of 1.197 as at 30 September 2013.

Key management events over the quarter and post quarter end

· Vacancy rate decreased to 19.78% as at 30 September 2013 from 22.31% the previous quarter following a combination of letting activity and the sale of one vacant asset in France.

· One fully vacant asset was sold in Châteuneuf-de-Gadagne, France, at a 3.4% discount to the 30 June 2013 valuation, enabling the Company to repay €3.2 million in outstanding debt and reduce the portfolio's overall void rate (calculated as ERV on vacant space as a percentage of total potential rent) by 1.4 percentage points.

· Post quarter end, on 7th November, the sale of a further 3 French logistics assets was completed of which 9,090 sqm was vacant accommodation (64.4% of the total space).

· Property portfolio valuation declined by 2.1% over the quarter (1.0% on a like for like basis) as at 30 September 2013.

· Utilised €11.9 million in cash to pay down debt on 25 July 2013 to ensure the LTV level remained below the current covenant of 70%, as well as making a further payment of €1.9 million post quarter end for the same reasons.

· Post quarter end the Company has accelerated the deleveraging of its Loan, placing 14 of its property assets on the market. These disposals are part of the Company's refinancing strategy, targeting a core portfolio of 18 properties, which the Company expects will be more attractive to prospective lenders.

· Post quarter end the Company agreed an extension to the maturity date of its Credit Facility (the "Loan") with Bank of Scotland ("BoS") from 31 December 2013 to 30 April 2014. At the same time, IERET agreed to a relaxation in the terms of the transferability of the Loan, allowing for the sale of BoS's interest to Promontoria Holding 89 BV, an affiliate of Cerberus Institutional Partners V L.P ("Cerberus").

Property Portfolio

As at 30 September 2013, the Company's property portfolio was valued at €325.6 million and comprised 35 assets across six countries. The portfolio value decreased over the quarter on a like-for-like basis by 1.0% or €3.3 million; resulting from a combination of shortening lease lengths on some assets, and market pressures deflating estimated rental values in some localities.

The Company's portfolio generated gross income of €28.2 million per annum as a 30 September 2013, and produced a Net Initial Yield ("NIY") at the property level of 7.86%. The portfolio weighted average lease term to break is 4.0 years and 5.9 years to expiry. The portfolio void level (calculated as ERV on vacant space as a percentage of total potential rent) as at 30 September 2013 decreased over the quarter to 19.8%.

The portfolio's credit rating as measured by the Investment Property Databank's M-IRIS credit analysis system in October 2013 and scored 64 out of 100, which is classified in the "low-medium risk" band.

As at 30 September 2013 the portfolio composition was as follows:

Sector Weightings

*Percentage of aggregate asset value as at 30 September 2013

Country Weightings

*Percentage of aggregate asset value as at 30 September 2013

Top 10 Properties

*Percentage of aggregate asset value plus cash as at 30 September 2013

Top 10 Tenants

* Percentage of aggregate gross rent as at 30 September 2013

1 Given the current investment strategy, the UK Listing Rule restriction on limiting rental income from any one tenant to less than 20% is superseded.

Market Context

The economic outlook for the European region improved over the past 12 months with the Eurozone exiting recession in Q2. However, the nascent recovery remains fragile with threats in the form of weak domestic demand, illustrated by high levels of unemployment, unresolved political issues in key export markets and in regards to the implementation of a European banking union. The recovery has also been uneven with disparity within Europe as Germany leads the Eurozone out of recession while Southern Europe experienced lower levels of growth. Following comments by Mario Draghi, President of the European Central Bank, to do 'whatever it takes' to preserve the Euro, investor confidence has continued to improve with the equity markets rising across Europe while debt markets experienced relative calm.

Despite an improvement in the confidence of French businesses the economy has yet to experience the same level of economic recovery that has benefitted other Northern European economies. This has been reflected in the occupier market for French logistic assets during the first nine months of 2013 where occupiers remained cautious with take-up declining by 13% y/y (BNP Paribas). The île-de-France market remains the most active region for occupier activity accounting for 32% of national take-up during the first 9 months of 2013 but demand for the region was down 24% y/y in the year to September 2013 (BNP Paribas). In contrast, Lille, Marseille and Toulouse proved more resilient with take-up volumes increasing by 90%, 30% and 8% respectively over the first 9 months (BNP Paribas). However, activity in these markets appears to have been driven by a small number of large transactions with demand generally focused on Grade A stock. Availability of French logistics stock increased by 7% from Q1 to Q3 2013 but this trend continues to be driven by the release of Grade B and C stock while available Grade A stock continues to decline (CBRE).

Take-up for German office space over the first 9 months was down just 2% on the same period in 2012 (JLL) with occupier activity experiencing a modest recovery since the start of the year in line with higher levels of German business confidence as the IFO Business Climate Index rose to 109.5 in December, representing a 20 month high. Prime and good secondary locations that benefit from good communication links to the main business centres have experienced some stability in demand while Grade C stock has continued to suffer from high levels of vacancy. In the German retail market both domestic and international retailers remain attracted by the robust levels of employment and high levels of consumer confidence. Occupiers remain discerning over asset location and specification with prime and good quality secondary assets experiencing stable rental values.

The core European markets of UK, France and Germany accounted for the 65% of the €143bn invested into European real estate during the 12 months to Q3 2013 (CBRE). However, there are encouraging signs that investors have become increasingly active in the perceived higher risk markets with investment into Southern Europe experiencing a significant increase with a combined total €2.2bn completed in Spain, Italy and Portugal during Q3, representing an increase of 145% on Q3 2012 (CBRE). A sustained economic recovery is likely to provide further encouragement for investors to take on higher levels of risk.

Asset Management Results

In line with the cautious signs of recovery that have emerged over the last two quarters, the Company achieved a number of successes on disposal and asset management strategy. Overall vacancy levels fell during the quarter on a like for like basis, largely due to a lease expansion at an asset in Boechoutlaan, Belgium, where 1,882 sqm of previously vacant space was taken up; and a new letting covering 6,335 sqm of vacant logistics accommodation in Monteux, France. Post quarter end a further new letting was secured, covering 9,248 sqm of vacant logistics accommodation in Amsterdam, Netherlands. New lettings representing an amount equal to 5.5% of existing annual income were in agreed heads of terms as at 30 September 2013.

In addition to securing income through lease re-gears and by seeking new tenants, the Company remains actively engaged with its disposal strategy. Post quarter end the Company disposed of three assets in France, and placed another 14 assets on the market. These assets have been chosen either on the basis of their prospective long term vacancy, in which case their disposal will improve the characteristics of the remaining portfolio in advance of refinancing; or because they have recently benefitted from asset management initiatives which has placed them in a strong position for sale.

Borrowings

As at 30 September 2013, the Company had drawn down a total of €229.7 million of senior debt in respect of its €359.3 million facility with the Bank of Scotland. In addition, the Company had cash balances of €18.3 million (excluding tenant deposits of €3.1 million and escrow accounts of €2.7 million) at that date, giving a net debt position of €211.4 million.

On 26 July 2013, €11.9 million of cash from the Company's balance sheet was used to pay down a debt with the Bank of Scotland and thus reduce its drawn debt facilities to €229.7 million, thereby decreasing the LTV to below 70% (as calculated by reference to 30 June 2013 valuation) in order to benefit from a reduction in the interest rate margin by 25 basis points while meeting the LTV covenant of 70%.

Following a reduction in portfolio valuation as at 30 September 2013 by 2.09% quarter on quarter, the Company made an additional amortization payment of €1.9 million, thus maintaining an LTV below the 70% covenant. As further progress with IERET's asset disposal strategy is anticipated in the next year, the Company will continue to review the use of cash and the best utilisation of sale proceeds.

All debt is fully hedged against changes in European interest rates until December 2013, giving a total interest cost of 6.72% per annum at current LTV levels.

Outlook

The Company has made progress in reducing the outstanding level of debt through the utilisation of surplus cash as well as through disposals, concentrating on the sale of vacant assets through the quarter and post quarter end. In addition to the immediate cash proceeds from the recent sales of vacant assets, there are also material savings arising from the reduction in non-recoverable and debt service costs. These both benefit the Company's operating income and enhance the overall quality of the portfolio and its attractiveness to potential lenders.

The dominant concern of the Board and advisers of IERET during the last several months has been the maturity of the Company's existing debt facility ("the Loan") with Bank of Scotland PLC ("BoS" or "the Bank"), which was due to mature on 31 December 2013. Post quarter end, the Company succeeded in structuring more than one refinancing package from a number of different sources, while also engaging in constructive discussions with BoS in the hope of coming to an agreement which would enable a satisfactory outcome for the Company as well as its largest creditor. The news that BoS intended to include the Loan in a larger portfolio of loans named "Project Hampton" marked an important milestone: many potential investors and lenders were either conflicted or considered it hard to justify incurring transactional costs if there was a likelihood that the Loan would be transferred as part of Project Hampton. As a result, the Company was only able to present a conditional refinancing proposal to the Bank post quarter end, offering to repay an amount in full and final settlement of all liabilities to BoS, subject to a certain level of debt forgiveness. As the Company announced on 2 December 2013, this proposal was not accepted, and negotiations with BoS with regards to new proposals for refinancing drew to a close.

However, BoS offered to grant IERET a short term extension to the Loan's maturity, to 30 April 2014, in order to provide sufficient time for the Board and its advisers to enter into discussions with the new owner of the Loan, Promontoria Holding 89 BV, an affiliate of Cerberus Institutional Partners V L.P ("Cerberus"). On 23 December 2013 the Company accepted this proposal, simultaneously agreeing to a relaxation in the terms of the Loan's transferability. The Company is now seeking to deleverage through a number of property sales, with a view to creating a smaller, more attractive portfolio of assets around which a suitable refinancing package may be structured.

For further information, please contact:

Internos Global Investors

Ludovic Bernard +44 20 7355 8800

Citco REIF Services (Luxembourg) SA

Jorrit Crompvoets +352 47 23 23 212

Hudson Sandler

Michael Sandler +44 20 7796 4133