Update on Joint Ventures

Warner Estate Holdings PLC

Update on Joint Ventures

The Board of Warner Estate Holdings PLC ("Company" and together with its subsidiaries "Group") wishes to clarify the position regarding two of the Group's three joint ventures.

Greater London Offices Limited ("GLO")

GLO is a joint venture owned equally by the Company and Barclays Bank plc. GLO has two subsidiaries, Greater London Offices (Central House) Limited and Greater London Offices (Old Broad Street) Limited. These subsidiaries are the borrowers under facilities, the outstanding debt of which is non-recourse to the Group. Recently, fixed charge receivers were appointed over the properties held by the subsidiaries and the Company awaits clarification from the receivers as to their intentions.

These appointments were not anticipated even though, as the Company announced earlier this year, the non-recourse debt facilities had been transferred to Special Servicing. The two assets have been maintained at full occupancy and as a consequence of this, and proactive asset management, their combined value exceeds the amount of the outstanding debt excluding the mark-to-market value of the hedging instruments. Both entities continue to service fully all debt liabilities including amortization.

Currently, the asset management agreement with the Group remains in place. The asset management fee income from GLO is approximately £0.3m per annum. The carrying value of the investment in GLO on the Company's balance sheet was written down to £Nil some time ago. 

Agora Max Limited ("Agora Max")

Agora Max is a joint venture owned equally by the Company and Uberior Ventures Limited (now part of Lloyds Banking Group) that indirectly, through certain unit trusts, holds two shopping centre properties.

Unit trusts within the joint venture structure are the borrowers under a finance facility, the outstanding debt of which is non-recourse to the Group. This finance facility has matured and discussions between the borrowers and the lenders continue. Savills are expected to be appointed to advise the borrowers on options to maximise value recovery.

The asset management agreement with the Group remains in place. The asset management fee income from Agora Max is approximately £0.5m per annum. The carrying value of the investment in Agora Max on the Company's balance sheet was written down to £Nil some time ago. 

13th May 2011

-ends-Enquiries:Warner Estate Holdings PLCPhilip Warner, ChairmanMark Keogh, Group Managing DirectorRobert Game, Group Managing Director - Property

Tel: 020-7907-5100Web: www.warnerestate.co.uk

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