Update on the European Care Group

19 June 2014

Public Service Properties Investments Limited

("PSPI", the "Group" or the "Company")

Update on the European Care Group ("ECG")

PSPI (AIM: PSPI), the specialist European real estate investment and financing company, has been informed that the sole shareholder of Esquire Consolidated Investment (Holdings) Limited ("ECIHL") has appointed Zolfo Cooper LLP to act as Liquidator of ECIHL. In July 2012, PSPI was issued a £2.8 million subordinated loan note by ECIHL as part of the consideration for the sale of the majority of its UK property portfolio; however at the time of its issue, PSPI valued the asset at £1,000 reflecting the significant level of debt in the Esquire Group. PSPI has not accrued interest on the loan note as neither the interest nor principal were deemed to be recoverable. PSPI does not expect to receive any sum arising out of the liquidation process.

Further to its announcement released on 17 April 2014, PSPI has been informed that the majority of the operating subsidiaries of European Care & Lifestyles (UK) Limited ("ECL"), an intermediary holding company of ECG, have been acquired by two investment firms and that ECG has been subsequently renamed as Embrace Group Limited. This acquisition included all of the ECL subsidiaries which entered into 35 year leases and business licences with PSPI in 2004. Monthly rents and business licence fees in respect of entities that are tenants and licensees of PSPI owned assets have continued to be paid in full.

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