UPDC REAL ESTATE INVESTMENT TRUST: 2021 AUDITED FINANCIAL STATEMENTS

UPDC REAL ESTATE INVESTMENT TRUST

FINANCIAL STATE

FOR THE YEAR ENDED DECEMBER 31, 2021

#Classified as confidential

UPDC REAL ESTATE INVESTMENT TRUST FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2021

CONTENTS

Parties to the trust

Trustees report

Fund manager’s report

Statement of Fund Manager Responsibilities

The auditor’s report

Statement of comprehensive income

Statement of financial position

Statement of changes in units and reserves

Cash flow statement

Notes to the financial statements

Other financial information:

– Declaration of added value

– Five-year financial summary

UPDC REAL ESTATE INVESTMENT TRUST FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2021

TRUST PARTIES

Trustees

United Capital Trustees Limited UBA House (12th Floor)

57 Marina

Lagos

Telephone: (01) 2807032

Trustees

FBNQuest Trustees Limited 10 Keffi Road

Off Awolowo Road, southwest of Ikoyi Lagos

Telephone: (01) 4622673

The head of finance

Stanbic IBTC Asset Management Limited The Wealth House

Land 1678 Olakunle Bakare Close Sanusi Fafunwa Street Victoria Island

Lagos

Tel: 234-1-2805595

E-mail:mutualfunds@stanbicibtc.com

Website:www.stanbicibtcassetmanagement.com

building manager

UACN Property Development Company Plc (UPDC) REIT Business Manager

3rd floor

1/5 Odunlami Street Lagos Island, Lagos. Telephone: (01) 2702201

Registrars

First Registrars Nigeria Limited Plot 2 Abebe Village Road, Iganmu

Lagos

Telephone: (01) 773086

Guardian

UBA Plc (Global Investor Services Division) UBA House

57 Lagos Marina

Telephone: (01) 2808349

Banker

United Bank for Africa Plc Head Office Branch UBA House

57 Lagos Marina

Telephone: (01) 2808349

Listener PricewaterhouseCoopers (Chartered Accountants) Landmark Towers,

5B Water Corporation Drive Victoria Island

Lagos

Telephone: (01) 2711700

Joint Administrators Report on the UPDC Real Estate Investment Trust

For the financial statements for the year ended 31st December 2021

The Trustees present their report on the affairs of the UPDC Real Estate Investment Trust together with the financial statements for the year ended 31st December 2021.

Primary activity :

The principal business of UPDC Real Estate Investment Trust (the “REIT”) is to pool investments in a diversified portfolio of income-generating real estate in Nigeria with high growth potential in accordance with the Trust Investments Act, the Investments and Securities Act (2007), the Rules and Regulations of the Securities and Exchange Commission and the Indenture of Trust (the applicable regulations).

Results:

The results for the year ended 31st December 2021 are presented on pages 9 and 10

Change of fund manager

During the year under review, a new fund manager was appointed by the co-trustees with the approval of the Securities and Exchange Commission. Stanbic IBTC Asset Management Limited is the new fund manager for UPDC REIT.

Directors:

The directors of the fund manager who served during the period under review were:

Directors and related parties

None of the directors of the fund manager, FBNQuest Trustees Limited andinterest in the units of the United Capital Trustees Limited has a direct beneficial interest in the Units

REITs:

of the REIT.

Fund Manager Responsibilities:

The Investments and Securities Act 2007 requires the fund manager to keep proper books of account and prepare annual financial statements, which give a true and fair view of the state of affairs of the real estate investment trust during the period covered by the financial statements.

The Fund Manager is responsible for maintaining appropriate accounting records, which disclose with reasonable accuracy, at all times, the financial condition of the REIT and enable the Fund Manager to ensure that the financial statements comply with applicable regulations.

The Fund Manager is also responsible for maintaining adequate financial resources to meet its commitments and manage the risks to which the Fund is exposed.

Fiduciary responsibilities:

ofthe

The responsibilities of trustees, as set out in the rules and regulations of the Securities and Exchange Commission made under the Investments and Securities Act of 2007, are set out below:

•  To monitor the activities of the Fund Manager and the Custodian on behalf of and in the interest of the Unitholders;

•  Ensure that the Custodian takes custody of all assets of the Fund and holds them in trust for the holders in accordance with the Trust Deed and the Custodian Agreement;

•  Monitor the register of unitholders or contributors;

•  Ensure compliance by the Fund Manager with Applicable Regulations;

•  Ensure that monthly statements/reports and other periodic reports relating to the Fund are sent by the Fund Manager to the Commission;

•  Take all steps and execute all documents necessary to secure acquisitions or disposals properly made by the Fund Manager in accordance with the Trust Deed and the Custodian Agreement;

•  Exercise any voting rights conferred on it as the registered holder of any investment and/or transmit to the Fund Manager within a reasonable time all notices of meetings, reports, circulars, solicitations of proxies and any other document of the same nature for the necessary measures;

•  Ensure that the fees and expenses of the Fund are within the prescribed limits; and

•  Act at all times in the interest and for the benefit of the Plan’s unitholders.

Administration of the REIT:

During the period under review, the allocation to liquid assets exceeded the maximum limit of 10% provided for in the Trust Deed. The increase in the percentage of liquid assets is explained by the fall in the value of real estate assets. Apart from this, the Fund has been administered in accordance with applicable regulations, taking into account prevailing market conditions and preserving and minimizing

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