Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Rafael Calvo 18

28010 Madrid

España

BDO Auditores, S.L.P., sociedad limitada española, inscrita en el Registro Oficial de Auditores de Cuentas nº S1.273, es miembro de BDO International

Limited, una compañía limitada por garantía del Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas.

Registro Mercantil de Barcelona, Tomo 47.820, Sección 8ª Folio 201, Hoja nº B-563.253 (Inscripción 124) CIF: B-82387572

Audit report on the financial statements issued by an independent auditor

Translation of a report originally issued in Spanish based on our work performed in accordance

with generally accepted auditing standards in Spain. In the event of a discrepancy, the Spanish-

language version prevails

To the Shareholders of Saint Croix Holding Immobilier, SOCIMI, S.A.:

Report on the financial statements

Opinion

We have audited the financial statements of Saint Croix Holding Immobilier, SOCIMI, S.A. (the

Company), which comprise the balance sheet at 31 December 2022, the profit and loss

account, the statement of changes in equity, the statement of cash flows and the report for

the financial year ended on that date.

In our opinion, the accompanying financial statements give, in all material respects, a true and

fair view of the Company's equity and financial position as at 31 December 2022, as well as its

results and cash flows for the financial year ending on said date, in accordance with the

application of the regulatory framework of financial information (identified in note 3 of the

report) and, in particular, with the accounting principles and criteria contained therein.

Basis for opinion

We have performed our audit in accordance with the current regulations governing the auditing

of accounts in Spain. Our responsibilities in accordance with these regulations are described

later in the section Auditor's Responsibilities relating to the audit of the financial statements

of our report.

We are independent of the Company in accordance with the ethical requirements, including

those of independence, which are applicable to our audit of the financial statements in Spain

as required by the regulations governing the activity of auditing accounts. Accordingly, we have

not provided services other than those of the audit of accounts nor have concurred situations or

circumstances that, in accordance with the provisions of the aforementioned governing

regulations, have compromised the necessary independence.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our audit opinion.

Key audit matters

The key audit matters are matters that, in our professional judgment, were of most

significance in our audit of the financial statements of the current period. Our audit procedures

relating to these matters were designed in the context of our audit of the financial statements

as a whole, and in the formation of our opinion on these and we do not express a separate

opinion on those matters.

Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Rafael Calvo 18

28010 Madrid

España

BDO Auditores, S.L.P., sociedad limitada española, inscrita en el Registro Oficial de Auditores de Cuentas nº S1.273, es miembro de BDO International

Limited, una compañía limitada por garantía del Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas.

Registro Mercantil de Barcelona, Tomo 47.820, Sección 8ª Folio 201, Hoja nº B-563.253 (Inscripción 124) CIF: B-82387572

Key Audit matters

Audit response

Valuation of property investments at

financial year-end

The heading "Property Investments" in

the attached balance sheet includes

the carrying values at 31 December

2022 of the land and buildings owned

by the Company in accordance with the

detail shown in note 7 of the annual

report.

Notes 5.2 and 5.3 of the report

describe the valuation criteria for these

assets at financial year-end. For the

application of these criteria, the

Company's management has relied on

valuations performed by an

independent expert, which include

important elements of judgment, in

particular with regard to updated

market values and discounted income.

The analysis of the reasonableness of

the recoverable value of these assets as

at 31 December 2022 has been

considered the key audit matter.

We have performed, amongst others, the

following audit procedures:

- Understanding and analysis of the policies

and procedures followed by the Company's

management for the valuation of property

investments at financial year-end.

- Obtaining the valuation report at financial

year-end 2022 for the property investments

owned by the Company, prepared by an

independent expert.

- Evaluation of the competence and

independence of the external valuator, as

well as the reasonableness of the valuation

methodologies and the assumptions used,

involving valuation experts in the

engagement team to help with said

analysis.

- Analysis of the reasonableness of the

calculations made by the Company's

management to determine, where

appropriate, the impairment losses as at 31

December 2022, based on the

aforementioned valuation report.

- Evaluation of the suitability and adequacy

of the information included by the

Company's management in the annual

report in relation to the valuation of these

assets.

Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Rafael Calvo 18

28010 Madrid

España

BDO Auditores, S.L.P., sociedad limitada española, inscrita en el Registro Oficial de Auditores de Cuentas nº S1.273, es miembro de BDO International

Limited, una compañía limitada por garantía del Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas.

Registro Mercantil de Barcelona, Tomo 47.820, Sección 8ª Folio 201, Hoja nº B-563.253 (Inscripción 124) CIF: B-82387572

Other information: Management report

The other information comprises exclusively the management report for financial year 2022,

the formulation of which is the responsibility of the Company’s management and does not form

an integral part of the financial statements.

Our audit opinion on the financial statements does not cover the management report. Our

responsibility regarding the information contained in the management report is defined in the

regulation governing financial statement audit work, which establishes two distinct levels of

responsibility:

a) Checking solely that certain information included in the Annual Corporate Governance

Report and Annual Report on Remuneration of Directors, referred to Audit Act, has been

provided in accordance with applicable regulations and, if not, report that fact. In this

regard, the Annual Corporate Governance Report and Annual Report on Remuneration of

Directors have been included by reference in the management report.

b) Evaluate and report on concordance of the rest of the information included in the

management report and the financial statements, based on the knowledge of the Company

obtained during the audit of the aforementioned financial statements, as well as evaluate

and report on whether the content and presentation of the management report are in

accordance with applicable regulations. If, based on the work we have performed, we

conclude that material misstatements exist, we are required to report that fact.

Based on the work performed, as described in the previous paragraph, we have verified that

the information contained in section a) above is provided in accordance with applicable

regulations and the rest of the information contained in the management report agrees with

that in the financial statements for financial year 2022 and its content and presentation is in

accordance with the applicable regulations.

The responsibility of the management and the audit committee in respect of the financial

statements

The management are responsible for formulating the accompanying financial statements, so

that they give a true image of the assets, the financial situation and the results of the

Company, in accordance with the regulatory framework on financial information applicable to

the Entity in Spain, and of the internal control that they consider necessary to allow the

preparation of the financial statements free of material misstatement, due to fraud or error.

In the preparation of the financial statements, the management are responsible for assessing

the Company's ability to continue as a going concern, revealing, as appropriate, the matters

related with a company in operation and using the accounting principle of a going concern

except if the management intend to liquidate the Company or cease operations, or if there is

no other realistic alternative.

The audit committee is responsible for supervising the process of preparing and presenting the

financial statements.

Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Rafael Calvo 18

28010 Madrid

España

BDO Auditores, S.L.P., sociedad limitada española, inscrita en el Registro Oficial de Auditores de Cuentas nº S1.273, es miembro de BDO International

Limited, una compañía limitada por garantía del Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas.

Registro Mercantil de Barcelona, Tomo 47.820, Sección 8ª Folio 201, Hoja nº B-563.253 (Inscripción 124) CIF: B-82387572

The auditor’s responsibility for the audit of the financial statements

Our objectives are to obtain reasonable assurance that the financial statements as a whole are

free from material misstatement, due to fraud or error, and to issue an audit report that

contains our opinion.

Reasonable assurance is a high degree of assurance, but is not a guarantee that an audit

conducted in accordance with the regulations governing the audit activity in force in Spain will

always detect a material misstatement when it exists. Misstatements can arise from fraud or

error and are considered material if, individually or in aggregate, they could reasonably be

expected to influence the economic decisions of users taken on the basis of these financial

statements.

As part of an audit in accordance with the current regulations governing the account auditing

activity in Spain, we exercise professional judgment and maintain an attitude of professional

skepticism throughout the audit. Also:

•

We identify and assess the risks of material misstatement in the financial statements, due

to fraud or error, design and perform audit procedures to respond to those risks and obtain

audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk

of not detecting a material misstatement resulting from fraud is higher than one resulting

from error, as fraud may involve collusion, forgery, intentional omissions,

misrepresentations, or circumvention of internal control.

• We obtain knowledge of the internal control relevant to the audit in order to design audit

procedures that are appropriate in the circumstances, but not for the purpose of expressing

an opinion on the effectiveness of the Entity’s internal control.

• We evaluate the appropriateness of accounting policies used and the reasonableness of

accounting estimates and disclosures made by management.

• We conclude whether the use, by management

, of the accounting principle of the company

as a going concern is adequate and, based on the audit evidence obtained, we conclude on

whether or not there is a material uncertainty related to events or conditions that can

generate significant doubts about the ability of the Company to continue as a going

concern. If we conclude that there is material uncertainty, we are required to draw

attention in our audit report to the corresponding information disclosed in the financial

statements or, if such disclosures are not adequate, we express a modified opinion. Our

conclusions are based on the audit evidence obtained at the date of our audit report.

However, future events or conditions may cause the Company to cease to be a going

concern.

• We evaluate the overall presentation, structure and content of the financial statements,

including the disclosures and whether the financial statements represent the underlying

transactions and events in a manner that achieves fair presentation.

Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Rafael Calvo 18

28010 Madrid

España

BDO Auditores, S.L.P., sociedad limitada española, inscrita en el Registro Oficial de Auditores de Cuentas nº S1.273, es miembro de BDO International

Limited, una compañía limitada por garantía del Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas.

Registro Mercantil de Barcelona, Tomo 47.820, Sección 8ª Folio 201, Hoja nº B-563.253 (Inscripción 124) CIF: B-82387572

We are required to communicate with the Entity's audit committee regarding, amongst other

matters, the planned scope and timing of the audit and significant findings, including any

significant deficiencies in internal control that we identify during the course of the audit.

We are also required to provide the Entity's audit committee with a statement that we have

complied with the relevant ethical requirements, including those of independence, and to

communicate with them all relationships and other matters that may reasonably be thought to

bear on our independence, and where applicable, related safeguards.

Amongst the matters that have been communicated to the Entity's audit committee, we

determine those that have been of the greatest significance in the audit of the financial

statements of the current period and that are, consequently, the key matters of the audit.

We describe those matters in our audit report unless legal or regulatory provisions prohibit

public disclosure of the matter.

Report on other legal and regulatory requirements

Additional report for the audit committee

The opinion expressed in this report is consistent with what was stated in our additional report

for the Company’s audit committee dated 3 March 2023.

Contract period

The Ordinary General Shareholders’ Meeting held on 30 June 2020 appointed us as auditors for

a period of 3 years, commencing from financial year ended on 31 December 2020.

BDO Auditores, S.L.P. (ROAC S1273) (ROAC - Official Registry of Account Auditors)

Francisco J. Giménez Soler (ROAC 21.667)

3 March 2023

SAINT CROIX HOLDING IMMOBILIER,

SOCIMI, S.A.

Financial Statements

for the year ended on

31 December 2022

and Management Report

 
 

 
Table of Contents 
 
 
Annual Report ____________________________________________________________________________ 2 
 Company's activity _________________________________________________________________ 8 
 Applicable law ____________________________________________________________________ 10 
 Basis for presenting the financial statements __________________________________________ 12 
 Profit distribution __________________________________________________________________ 14 
 Accounting principles and accounting and measurement rules  __________________________ 14 
 Property, plant and equipment ______________________________________________________ 20 
 Property investment _______________________________________________________________ 21 
 Operating leases __________________________________________________________________ 27 
 Other financial assets and investments in related companies ____________________________ 27 
 Trade and other accounts receivable  ________________________________________________ 29 
 Cash and cash equivalents _________________________________________________________ 30 
 Information on the nature of financial instruments and their level of risk ___________________ 30 
 Total equity and shareholders' equity  ________________________________________________ 31 
 Current and non-current liabilities ___________________________________________________ 34 
 Hedge instruments ________________________________________________________________ 37 
 Disclosure on supplier payment deferrals _____________________________________________ 37 
 Guarantees undertaken with third parties _____________________________________________ 38 
 Public administrations and tax situation _______________________________________________ 39 
 Income and expenses  _____________________________________________________________ 43 
 Related-party transactions and balances ______________________________________________ 44 
 Remuneration for the Board of Directors and Senior Management ________________________ 46 
 Information on conflicts of interest among the Directors _________________________________ 46 
 Other information _________________________________________________________________ 46 
 Environmental information __________________________________________________________ 47 
 Segmented reporting ______________________________________________________________ 48 
 International Financial Reporting Standards ___________________________________________ 49 
 Subsequent disclosures ____________________________________________________________ 50 
 
Annex 1. Reporting requirements as a REIT __________________________________________________ 51 
 
Management Report  _____________________________________________________________________ 55 
 Explanation of figures at 31 December 2022 __________________________________________ 56 
 Valuation of real estate assets _______________________________________________________ 60 
 Segmented reporting ______________________________________________________________ 61 
 Property Investment _______________________________________________________________ 63 
 Disclosure on supplier payment deferrals _____________________________________________ 63 
 Earnings per share ________________________________________________________________ 64 
 Acquisition of treasury shares _______________________________________________________ 64 
 Research and development activities  ________________________________________________ 64 
 Main risks to the Company _________________________________________________________ 64 
 Outlook for 2023 __________________________________________________________________ 65 
 Information on conflicts of interest among the Directors _________________________________ 66 
 Subsequent disclosures ____________________________________________________________ 66 
 Annual Corporate Governance Report and Annual Report on Directors' Remuneration ______ 67 
 
Directors' Responsibility Statement _________________________________________________________ 68 
 
Diligence in Drawing Up the Financial Statements ____________________________________________ 69 
 
 
   

Annual Report

2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

BALANCE SHEET AT 31 December 2022

(euros)

Notes to the

Financial year

Notes to the

Financial year

ASSETS

Financial Statements

2022

2021

EQUITY AND LIABILITIES

Financial Statements

2022

2021

NON‐CURRENT ASSETS

441,679,127

399,535,635

EQUITY

312,056,267

312,408,821

OWN FUNDS

Intangible fixed assets

205

Computer software

205

Capital

267,577,040

Property, plant and equipment

149,473

1,152

Authorised capital

267,577,040

Plant and other tangible fixed assets

149,473

1,152

Reserves

28,981,526

22,304,878

Property investment

438,508,778

396,957,408

Legal and statutory

10,028,140

7,845,663

Net property investments

438,508,778

396,957,408

Other reserves

18,953,386

14,459,215

Long-term financial investments

3,020,841

2,576,870

Profit (Loss) for the year

14,254,857

21,824,771

Derivatives

9 and 15

314,055

Adjustments for changes in value

314,055

-283,008

Other financial assets

2,706,786

2,576,870

Hedging operations

314,055

-283,008

Subsidies, donations and bequests

928,789

985,140

Subsidies, donations and bequests

928,789

985,140

NON-CURRENT LIABILITIES

108,699,071

84,940,968

Non-current payables

108,699,071

84,940,968

Bank borrowings

104,798,848

80,987,013

Derivatives

9 and 15

283,008

CURRENT ASSETS

23,305,342

18,343,748

Other financial liabilities

3,900,223

3,670,947

Inventories

9,718

Advance payments to suppliers

9,718

CURRENT LIABILITIES

44,229,131

20,529,594

Trade and other accounts receivable

4,205,675

3,635,610

Current payables

35,514,865

17,969,976

Accounts receivable for sales and services

4,174,532

3,607,767

Bonds and debentures

2,026,165

Trade and other accounts receivable

20,017

Bank borrowings

35,026,383

15,343,959

Staff

944

480

Other financial liabilities

488,482

599,852

Current tax assets

18.1

20,362

7,346

Current payables with Group and associate companies

9 and 20.2

3,461,920

38,400

Other credits with Public Administrations

18.2

9,837

Trade creditors and other accounts payable

5,252,346

2,521,218

Short-term investments in Group and associate companies

9 and 20.2

Suppliers

2,776,442

755,682

Short‐term financial investments

17,274,445

13,566,607

Sundry creditors

2,072,210

979,640

Short-term equity instruments

16,478,110

13,399,701

Other payables with Public Administrations

18.1

396,594

782,896

Other financial assets

796,335

166,906

Advance payments from customers

7,100

3,000

Cash and cash equivalents

1,825,221

1,131,813

Cash and bank

1,825,221

1,131,813

TOTAL ASSETS

464,984,469

417,879,383

TOTAL EQUITY AND LIABILITIES

464. 984,469

417,879,383

Notes 1 to 27 to the attached financial statements attached hereto form an integral part of the balance sheet at 31 December 2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

PROFIT AND LOSS ACCOUNT FOR 2022

(euros)

Notes to the

Financial year

Financial Statements

2022

2021

CONTINUED OPERATIONS

Revenues

19.1

30,644,323

24,081,817

Rental of properties

30,644,323

24,081,817

Other operating income

19.1

63,007

38,396

Non-core and other current management income

63,007

38,396

Staff costs

19.2

-486,103

-463,550

Wages, salaries and similar outgoings

-358,311

-340,467

National insurance contributions

-127,792

-123,083

Other operating expenses

-5,299,973

-4,389,802

Charges for external services

19.3

-3,010,801

-2,381,557

Taxes and similar levies

19.3

-2,289,343

-2,014,701

Losses, impairment and changes in provisions for trade transactions

171

6,456

Fixed asset depreciation

6 and 7

-5,986,123

-5,690,608

Charging of non-financial fixed asset subsidies and others

13 and 19.1

56,351

Impairment and gain (loss) on fixed asset-write offs and disposals

-128,172

9,137,021

Impairment and losses

-478,996

-385,598

Gains (losses) on disposals and others

350,824

9,522,619

Other gains (losses)

-20,765

24,853

Exceptional income and expenses

-20,765

24,853

OPERATING PROFIT (LOSS)

18,842,545

22,794,478

Financial income

402,994

461,985

From transferable securities and other financial instruments

402,994

461,985

- In Group and associate companies

20.1

38,663

- In equity instruments

377,351

345,905

‐ In third parties

25,643

77,417

Financial expenses

-2,073,585

-1,772,748

From Group and associate companies

20.1

-159,405

From payables with third parties

-1,914,180

-1,772,748

Variation in the fair value of financial instruments

-2,917,097

341,056

Gains (losses) on the trading portfolio

-2,917,097

341,056

FINANCIAL PROFIT (LOSS)

-4,587,688

-969,707

PROFIT (LOSS) BEFORE TAX

14,254,857

21,824,771

Income tax

PROFIT (LOSS) FOR THE YEAR

14,254,857

21,824,771

Notes 1 to 27 to the financial statements attached hereto form an integral part of the profit and loss account for 2022.

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

STATEMENT OF CHANGES IN EQUITY FOR 2022

A) STATEMENTS OF RECOGNISED INCOME AND EXPENSE

(euros)

Notes to the

Financial year

Financial Statements

2022

2021

RESULT OF THE PROFIT AND LOSS ACCOUNT (I)

14,254,857

21,824,771

Income and expenses recognised directly in equity

- For cash flow hedges

597,063

182,003

TOTAL INCOME AND EXPENSE RECOGNISED DIRECTLY IN EQUITY (II)

597,063

182,003

Transfers to profit and loss account

- Subsidies, donations and bequests

-56,351

- For cash flow hedges

-24,200

TOTAL TRANSFERS TO PROFIT AND LOSS ACCOUNT (III)

-56,351

-80,551

TOTAL RECOGNISED INCOME AND EXPENSE (I+II+III)

14,795,569

21,926,223

Notes 1 to 27 to the financial statements attached hereto form an integral part of the statement of recognised income and expense corresponding to 2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

STATEMENT OF CHANGES IN EQUITY FOR 2022

B) STATEMENTS OF CHANGES IN TOTAL EQUITY

(euros)

Subsidies,

Adjustments for

Legal

Other

Profit/(loss)

Interim

donations

changes

Capital

reserve

reserves

financial year

dividend

and bequests

of value

(Note 12)

(Notes 4 and 12)

(Note 12)

(Note 14)

Total

CLOSING BALANCE FOR 2020

267,577,040

6,901,253

14,459,215

9,444,108

-7,000,000

1,041,491

-440,811

291,982,296

Total recognised income and expenses

21,824,772

-56,351

157,803

21,926,223

Other variations in equity

944,410

-9,444,108

7,000,000

-1,499,698

- Distribution of profit in 2020

944,410

-944,410

- Distribution of dividends

-8,499,698

7,000,000

-1,499,698

CLOSING BALANCE FOR 2021

267,577,040

7,845,663

14,459,215

21,824,771

985,140

-283,008

312,408,821

Total recognised income and expenses

14,254,857

-56,351

597,063

14,795,569

Other variations in equity

2,182,477

4,494,171

-21,824,771

-15,148,123

- Distribution of profit in 2021

2,182,477

4,494,171

-6,676,648

- Distribution of dividends

-15,148,123

CLOSING BALANCE FOR 2022

267,577,040

10,028,140

18,953,386

14,254,857

928,789

314,055

312,056,267

Notes 1 to 27 to the attached financial statements attached hereto form an integral part of the statement of changes in equity for 2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

CASH FLOW STATEMENT FOR 2022

(euros)

Notes

Financial year

Financial Statements

2022

2021

A) CASH FLOWS FROM OPERATING ACTIVITIES

24,956,628

18,902,831

1. Profit (loss) before tax for the year

14,254,857

21,824,771

2. Adjustment to income:

10,645,802

-2,539,513

a) Amortisation of fixed assets (+)

6 and 7

5,986,123

5,690,608

b) Valuation corrections due to impairment (+/-)

478,995

385,598

c) Variation in provisions (+/-)

171

-6,456

d) Allocation of subsidies (-)

-56,351

e) Income from elimination and sales of fixed assets (+/-)

-350,824

-9,522,619

g) Financial income (-)

-402,994

-461,985

h) Financial expenses (+)

2,073,585

1,772,748

j) Variation in fair value of financial instruments (+/-)

2,917,097

-341,056

3. Changes in current capital:

1,531,127

946,108

a) Inventories (+/-)

-445,130

-9,718

b) Trade and other receivables (+/-)

-557,220

-1,565,744

c) Other current assets (+/-)

-315,555

4,385,201

d) Creditors and other accounts payable (+/-)

3,113,328

626

e) Other current liabilities (+/-)

-493,572

-926,046

f) Other non-current assets and liabilities (+/-)

229,276

-938,211

4. Other cash flows from operating activities:

-1,475,158

-1,328,535

a) Payments of interests (-)

-1,865,136

-1,918,717

b) Dividends receivable (+)

377,351

345,905

c) Collection of interests (+)

25,643

116,080

d) Receipt (payment) of income tax (+/-)

18.1

-13,016

128,197

B) CASH FLOWS FROM INVESTMENT ACTIVITIES

-54,113,819

-19,816,983

6. Investment payments (-):

-58,519,820

-45,185,349

c) Property, plant and equipment

-151,353

-958

d) Property investments

-52,068,463

-44,987,300

e) Other financial assets

-304,498

-197,091

f) Non-current assets kept for sale

-5,995,506

7. Proceeds from divestments (+):

4,406,001

25,368,366

a) Group and associated companies

9 and 20.2

2,450,366

d) Property investments

4,406,001

22,918,000

C) CASH FLOWS FROM FINANCING ACTIVITIES

29,850,599

-316,309

10. Receivables and payables from financial liability instruments

44,998,722

1,183,389

a) Issue:

46,998,722

32,891,230

2. Bank borrowings (+)

43,575,202

32,852,830

3. Payables with group companies and associated companies (+)

9 and 20.2

3,423,520

38,400

b) Return and amortisation of:

-2,000,000

-31,707,841

1. Bonds and other marketable securities (-)

-2,000,000

-8,000,000

2. Bank borrowings (-)

-23,707,841

11. Dividend payments

-15,148,123

-1,499,698

a) Dividends (-)

-15,148,123

-1,499,698

D) EFFECT OF CHANGES IN INTEREST RATES

E) NET INCREASE/DECREASE IN CASH AND EQUIVALENTS

693,408

-1,230,461

Cash or equivalent at start of year.

1,131,813

2,362,274

Cash or equivalent at end of year.

1,825,221

1,131,813

Note 1 to 27 to the accompanying half-year financial statements form an integrated part of the statement of cash flows for the six-

month period ending 31 December 2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Notes to the Financial Statements

for the Year Ending

31/12/2022

1. Company's activity

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A. (hereinafter the “Company”), was incorporated in

Luxembourg on 1 December 2011. Its registered office was located at Boulevard Prince Henri 9b, L-1724

Luxembourg, Grand Duchy of Luxembourg and the company was duly registered in the Luxembourg

Companies Registry (Register de Commerce et des Sociétés) with the number B165103. On 10 June 2014,

the Extraordinary General Meeting approved, among others, the relocation of the registered, tax and

administrative office (headquarters) to Glorieta de Cuatro Caminos 6 and 7 in Madrid, without winding up or

liquidating the company, and to continue performing the activities included under its corporate purpose in

Spain as a Spanish public limited company (sociedad anónima) and more specifically under the legal and

tax framework for listed real estate investment trusts (REITs), while maintaining the listing of all its shares on

the Luxembourg Stock Exchange.

After having finalised the process of transferring the headquarters to Madrid, Spain, the Company was duly

registered in the Madrid Companies Registry on 15 October 2014.

Its corporate purpose includes but is not limited to the following activities:

- The acquisition and development of urban real estate for leasing. Development activities include

the refurbishment of buildings under the terms set forth in Act 37/1992 of 28 December on Value

Added Tax.

- The holding of interests in the capital of other listed real estate investment trusts (hereinafter

“REITs”) or in the capital of other entities not domiciled in Spanish territory which have the same

corporate purpose as REITs and which are subject to a similar scheme as the one laid down for

REITs with regard to mandatory, legal or statutory policies on the distribution of profits.

- The holding of interests in the capital of other entities, whether or not they are domiciled in Spanish

territory, which have as their main corporate purpose the acquisition of urban real estate assets for

leasing and which are subject to the same scheme as that established for listed real estate

investment trusts (REITs) concerning mandatory, legal or statutory policies on the distribution of

profits and which meet the investment requirements laid down by Law 11/2009 of 26 October

governing Listed Real Estate Investment Trusts (hereinafter the “REIT Act”).

- The holding of shares or interests in collective real estate investment institutions governed by Act

35/2003 of 4 November on Collective Investment Institutions.

- The performance of other non-core or complementary financial and non-financial activities that

generate revenues which together amount to less than the percentage the REIT Act sets forth at

any time for the company's revenue in each tax period.

Given the nature of the activities that the Company currently performs, it has no environmental liabilities,

costs, assets, provisions or contingencies which might be significant in relation to its assets, financial situation

or results. As a result, no specific breakdowns of information on environmental matters have been included

in these notes to the financial statements.

Mergers

- Merger in 2016

In 2016, a reorganisation process was carried out to optimise and simplify the corporate structure of the

group headed by Saint Croix Holding Immobilier, SOCIMI, S.A. through a merger process whereby the

Company absorbed the subsidiaries, Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U. and

Inveretiro, SOCIMI, S.A.U, agreed at the Extraordinary and Universal General Shareholders' Meetings of the

Acquired Companies held on 19 May 2016 and at the Extraordinary General Shareholders' Meeting of the

Acquiring Company held on 19 May 2016. Said merger was undertaken for accounting purposes on 1

January 2016 by means of the winding up without liquidation of the Absorbed Companies and the provision

of all equity to the Absorbing Company. The merger agreement was made public through the Merger by

Absorption deed granted on 1 July 2016 and entered in the Madrid Companies Registry on 27 July 2016.

From that moment on, the Absorbing Company no longer formed a Consolidated Group.

As a result of the aforementioned operation, merger reserves of 14,154,738 euros arose on account of the

difference between the individual book values and the book values incorporated as part of the merger.

The merger was undertaken under the special system of mergers, divisions, transfers of assets and

exchanges of securities provided for under Chapter VIII of Law 27/2014, of 27 November on the Corporation

Tax Law.

- Merger in 2018

On 1 March 2018, the Company acquired 100% of the shares of Bensell Mirasierra S.L.U. for 17,623,669

euros. The only real estate asset of this company was an office building located at calle Valle de la Fuenfría

3 in Madrid, with a gross leasable area of 5,987 m2 . The transaction described above generated goodwill

attributable to its assets amounting to 5,506,170 euros, which was recognised as an increase in the cost of

the property (separately between land and construction) and which will be depreciated (the portion

attributable to construction) over the estimated useful life of the property.

An Extraordinary General Shareholders’ Meeting of the Company held on 28 June 2018 approved, among

others, the following resolutions:

- Merger by the Company (absorbing company) of its subsidiary, Bensell Mirasierra S.L.U. in

accordance with the merger project recorded in the Mercantile Registry of Madrid on 16 May 2018.

- On 21 September 2018, the Company signed the deed to merge with its subsidiary. The merger

agreement was registered in the Mercantile Registry of Madrid on 16 November 2018.

The merger was undertaken under the special system of mergers, divisions, transfers of assets and

exchanges of securities provided for under Chapter VIII of Law 27/2014, of 27 November on the Corporation

Tax Law.

Alternative Fixed Income Market

- 2015 Fixed Income Securities Issuance Programme

On 30 September 2015, the Company filed the base informative document regarding the incorporation of

mid- and long-term securities regarding a “2015 Fixed Income Securities Issuance Programme” on the

Alternative Fixed Income Market (“MARF”). The Base Document was published on the website of the

Alternative Fixed Income Market, as well as on the Company's website. For the purposes of registering said

bond programme, the Company was awarded a credit rating of BBB, stable (investment grade) by Axesor.

The programme had a duration of 1 year. The funds obtained from the issue were to be used for investment

in real estate assets and renovation of the assets in the portfolio.

The main features of the aforementioned programme can be summarised as follows:

- Maximum issue amount: 80,000,000 euros

- Repayment period: Between 2 and 7 years

- Coupon: Annual

- Nominal unit value ≥ 100,000 euros

- Aimed at: accredited investors

In 2016, two sets of Fixed Income securities were issued by the Company as part of the aforementioned

programme for the combined total of 10,000,000 euros, the main characteristics of which were as follows:

2021 Uncovered Bonds

2022 Uncovered Bonds

Nominal amount

8,000,000

2,000,000

Issue date

23/06/2016

Maturity date

23/06/2021

23/06/2022

Annual coupon

2.50%

Coupon payment

Annual

APR of the issuer

2.72%

2.77%

Average APR of both issues for the issuer was 2.73% per annum. The two sets of securities issued have

been traded on the Alternative Fixed Income Market “MARF” since 24 June 2016 (see Note 14).

As can be seen from the table above, at 31 December 2022 there is no outstanding debt balance after the

redemption and payment of the corresponding coupon on 23 June 2022.

2. Applicable law

The Company is governed by Law 11/2009 of 26 October governing Listed Real Estate Investment Trusts,

as amended by Law 16/2012 of 27 December. Article 3 of said Law, as amended by the new Law, sets forth

the investment requirements for this kind of companies, which are as follows:

1. REITs shall have at least 80 per cent of the value of their urban real estate assets allocated to leasing

and to land for real estate development which are to be allocated to such purpose, provided that

development is initiated within three years following its acquisition.

The asset value shall be determined according to the yearly average of the separate quarterly

balances and, in order to calculate such value, the Company may opt to replace the book value of

the elements comprising said balances with their market value, which would then be applied to the

entire year's balances. In this case, the money or credit rights from the transfer of this real estate or

equity interests made in the same year or in previous years shall not be included in the calculation,

as applicable, provided that, in the case of the latter, the reinvestment period established in Article

6 of this Act has not elapsed.

2. Likewise, at least 80% of the tax period income corresponding to each financial year, excluding

income from the transfer of holdings and of real estate both destined to fulfilling their main corporate

purpose, must come from the leasing of real estate and from dividends or interests in the profits

from such interests once the maintenance period referred to in the following paragraph has elapsed.

Said percentage shall be calculated on the basis of the consolidated profit (loss) should the

company be the parent company of a group as per the criteria set forth in Article 42 of the Code of

Commerce, irrespective of its domicile and of the obligation to draw up consolidated annual

accounts. Such group shall solely be comprised of REITs and the rest of the entities referred to in

paragraph 1, Article 2 of this Act.

3. The real estate constituting the company's assets must be leased for at least three years. For

calculation purposes, the time the real estate assets have been offered for lease shall be counted,

up to a maximum of one year.

The term shall be calculated:

a) From the start date of the first tax period in which the special tax regime set forth in this Law

applies, in the case of real estate included in the company's assets prior to joining the scheme,

as long as that on said date the asset was leased or offered for lease. Otherwise, the provisions

set forth in the following point shall apply.

b) From the date on which they were leased or offered for lease for the first time, in the case of

real estate assets subsequently developed or acquired by the company.

In the case of shares or interests in the entities referred to in paragraph 1, Article 2 of this Law, they must be

maintained in the company's assets for at least three years from the date of acquisition or, as appropriate,

from the start of the first tax period in which the special tax regime set forth in this Law applies.

As set forth by the First Transitional Provision of Law 11/2009 of 26 October governing Listed Real Estate

Investment Trusts, as amended by Law 16/2012 of 27 December, such companies may opt to apply the

special tax regime under the terms set forth in Article 8 of said Law, even where the requirements laid down

therein have not been fulfilled, provided such requirements are met within two years of the option date on

which the company chooses to apply the scheme.

The failure to comply with this condition shall mean that the Company will once again be taxed as per the

general tax scheme for Corporation Tax, as from the tax period when the failure to comply comes about,

except where it is corrected in the following year. Furthermore, along with the tax liability for such tax period,

the Company shall be obliged to pay the difference between the tax liability for the tax resulting from the

application of the general scheme and the tax liability effectively paid resulting from applying the special tax

regime in prior tax periods, without prejudice to any late payment interest, surcharges and penalties which

may, as appropriate, apply.

In addition to the above, the amendment of Law 11/2009 of 26 October by Law 16/2012 of 27 December

2012 established the following specific changes:

a) More flexible criteria for the inclusion and maintenance of real estate assets: there is no lower limit

on the number of real estate assets to be contributed at the REIT's incorporation, except for housing

units, of which at least eight must be contributed. Real estate assets no longer have to remain on

the company's balance sheet for seven years but only for at least three years.

b) Reduction in capital requirements and freedom to leverage: the minimum capital required was

reduced from 15 to 5 million euros, eliminating the restriction on the property investment vehicle's

maximum borrowing.

c) Reduction in dividend distribution: until the Law came into force, 90% of the profits had to be

distributed. This mandatory figure was reduced to 80% as from 1 January 2013.

The Corporation Tax levy for REITs is set at 0%. Nonetheless, where the dividends a REIT distributes to its

members holding an interest exceeding 5% are exempt or taxed at a levy below 10%, the REIT will be subject

to a special levy of 19%, which shall be deemed as the Corporation Tax liability on the amount of the

dividends distributed to such members. If applicable, this special levy shall have to be paid by the REIT within

two months from the date the dividends are distributed.

At year-end, the Company's directors consider that it meets all the requirements established by the

aforementioned law.

Law 11/2021, of 9 July and Order HFP/1430/2021, of 20 December

Law 11/2021, of 9 July, on measures for preventing and combating tax fraud, transposing Directive (EU)

2016/1164, of the Council, of 12 July 2016, establishing rules against tax evasion with a direct impact on the

domestic market, amending several tax and gaming regulation standards, amending Law 11/2009, of 26

October, establishing a special levy on undistributed profits from income not taxed at the general corporation

tax rate and that are not within the legal reinvestment period, adapting the information supply obligations to

the new taxation system.

In this regard, and effective for the tax periods starting 1 January 2021, it amends Article 9 of Law 11/2009,

of 26 October, on the special tax regime for companies in relation to corporation tax. The new Article 9(4)

establishes that Real Estate Investment Trusts shall be subject to a special levy on profits obtained during

the year that are not distributed, applicable to the part generated on income not taxed at the general

corporation tax rate and that is not classed as income within the legal reinvestment period, as regulated

under Article 6(1)(b) of the aforementioned law. This levy shall be considered tax payable in relation to

Corporation tax.

Subsequently, under Order HFP/1430/2021, of 20 December, approving form 237 “Special levy on

undistributed profits by real estate investment trusts. Corporation tax. Self-assessment”, the method and

procedure for filing corporation Tax in the form of self-assessments are defined.

It also regulates the following aspects:

- Those required to file the Form: Companies choosing to apply the REIT tax regime provided for in

Law 11/2009 of 26 October.

- Profits to be declared: Undistributed profits in the year generated on income not taxed at the general

corporation tax rate, excluding income within the reinvestment period under Article 6.1.b) of Law

11/2009. This levy shall be considered tax payable in relation to Corporation tax.

- Levy rate: The levy rate shall be introduced for the settlement of the tax (15% from 1 January 2021).

- Entry into force and year applicable: The order enters into force on 3 January 2022 and applies for

tax periods starting on 1 January 2021 onwards.

- Self-assessment submission period: Accrued on the day of the appropriation of earnings

agreement, subject to self-assessment in the 2 months following the accrual date.

3. Basis for presenting the financial statements

a) Regulatory financial reporting framework applicable to the Company

These financial statements have been produced by the Directors pursuant to the regulatory financial

reporting framework applicable to the Company, established in:

- the Code of Commerce and other trade law.

- General Accounting Plan approved by Royal Decree 1514/2007, which was amended in 2016 by

Royal Decree 602/2016, subsequently amended by Royal Decree 1159/2010 and subsequently

amended by Royal Decree 1/2021, of 12 January, and the sectoral adaptation to real-estate

companies.

- The mandatory regulations approved by the Institute of Accounting and Account Audits in

developing the General Accounting Plan and its complementary regulations.

- Law 11/2009 of 26 October governing Listed Real Estate Investment Trusts (REITs), as amended

by Law 16/2012 of 27 December.

- Other applicable Spanish accounts regulations.

b) True and fair view

The attached financial statements have been obtained from the Company's books and are presented

pursuant to the applicable regulatory financial reporting framework and, in particular, the accounting

principles and criteria contained therein, in such a way that they are a true reflection of the equity, financial

situation and results of the Company and the cash flows during the corresponding year.

These financial statements, which have been authorised for issue by the Directors of the Company, shall be

subject to approval by the General Shareholders' Meeting, and it is considered that they will be approved

without changes. In turn, the Company's financial statements for 2021 were approved without modification

by the General Shareholders' Meeting held on 27 April 2022.

c) Non-mandatory accounting principles employed

No non-mandatory accounting principles have been employed. Furthermore, the Directors have created

these financial statements considering all mandatory accounting standards and principles that have a

significant impact on said statements. No mandatory accounting principles have been disregarded.

d) Grouping of items

Certain entries on the balance sheet, the profit and loss account, the statement of changes in equity and the

cash flow statement have been grouped together to facilitate their understanding. However, to the extent by

which it is significant, detailed information with breakdowns has been provided in the corresponding notes

of the annual report.

e) Critical aspects of the valuation and the estimate of uncertainty

The estimates made by the Directors of the Company to value some of the assets, liabilities, revenues,

expenses and undertakings booked in the financial statements attached hereto have sometimes been used

in the process of producing the financial statements. These estimates essentially refer to:

- The valuation of any possible impairment losses of specific assets (see Note 5.1 and 5.3.).

- The useful life of real estate assets (see Note 5.3).

- The calculation of provisions (see Note 5.9).

Despite the fact that these estimates were made on the basis of the best available information at the end of

financial year ending on 31 December 2022, it is possible that future events may make it necessary to adjust

them either upward or downward in upcoming financial years, which will be done, as appropriate,

prospectively.

At 31 December 2022, the Company had a negative working capital balance of 20,923,789 euros (negative

balance of 2,185,847 euros at 31 December 2021). This deterioration in working capital is mainly due to the

reclassification of debt from long-term to short-term. The Company recurrently generates positive EBITDA,

meaning that the Company's Board of Directors believes that this does not represent uncertainty as regards

the continuity of the Company, as it is estimated that future profits to be earned next year, generated by

contracts involving real estate assets, will cover part of the Company’s short-term obligations. The Company

is also negotiating with financial institutions on various long-term financing formulas for its real estate assets

to ensure that these commitments can be met and transactions have already been signed, as mentioned in

Note 27. The Company currently has sufficient financing facilities to meet the payment requirements for its

committed investments in the various property refurbishment and construction projects. Finally, the

Company's real estate assets show significant unrealised gains based on their fair values at year-end (Note

7).

f) Comparison of the information

The information contained in this report which refers to 2022 is presented along with the 2021 information

for the purposes of comparison.

g) Correction of errors

In the production of the attached financial statements, no error has been identified that requires the re-

statement of amounts included in the financial statements for 2022.

4. Profit distribution

The proposal for the distribution of the Company's profits for 2022 to be submitted by the Directors of the

Company to the shareholders is as follows:

Euros

Basis of distribution:

Profit and Loss

14,254,857

Distribution:

Legal reserve

1,425,486

Voluntary reserve

175,412

Dividends

12,653,959

5. Accounting principles and accounting and measurement rules

The main valuation principles used by the Company in drawing up its financial statements for the year ended

on 31 December 2022 are as follows (in accordance with those established by the Spanish General Chart of

Accounts):

5.1 Property, plant and equipment

Property, plant and equipment are initially valued at their acquisition price or production cost, which is

subsequently reduced by their corresponding accumulated depreciation and impairment losses, if any.

For assets that take more than one year to become operational, capitalised costs include borrowing costs

incurred before the asset is put into use and drawn down from the supplier or relating to loans or other

specific or general external financing directly attributable to the acquisition or production of the asset.

Maintenance and repair costs for property, plant and equipment are recognised in the profit and loss account

for the year in which they are incurred. Conversely, amounts invested in improvements that help to increase

capacity or efficiency or extend the useful life of these assets are recognised as an increase in their cost.

The Company depreciates property, plant and equipment following the straight-line method by applying

annual depreciation percentages calculated on the basis of the respective assets' years of estimated useful

life, as follows:

Years of Estimated Useful Life

Buildings

Technical facilities and machinery

8-10

Photovoltaic installations

Other fixtures, fittings and furnishings

Other fixed assets

4-5

As indicated above, the Company depreciates these assets in accordance with the aforementioned years of

estimated useful life, considering as a basis for depreciation their historic cost values increased by new

investments which will be made and which involve an increase in their added value or their estimated useful

life.

5.2 Property investment

The “property investment” item on the balance sheet reflects the value of land, buildings and other

constructions and fixtures that are held either to operate them under leases or to obtain a capital gain on

their sale as a consequence of any increases that may come about in the future in their respective market

prices.

These assets are initially valued at their acquisition price or production cost, which is subsequently reduced

by their corresponding accumulated depreciation and impairment losses, if any.

The Company depreciates property investments following the straight-line method by applying annual

depreciation percentages calculated on the basis of the respective assets' years of estimated useful life:

These assets are valued in accordance with the criteria indicated in Note 5.1 on property, plant and

equipment.

5.3 Impairment in the value of property, plant and equipment and property investments

Whenever evidence for impairment may exist, the Company proceeds to estimate through the so-called

“Impairment Test” the possible existence of impairments which reduce the recoverable value of such assets

to below their book value. The recoverable amount is determined as the higher between fair value minus

sales costs and usage value. As part of the calculation of the fair value, the Company has used level 2

estimates, as these are based on measurement methodologies in which all the significant variables are based

on directly or indirectly observable market data.

The Company commissioned Jones Lang Lasalle, an independent expert, to conduct a valuation of its assets,

which was issued on 6 February 2023, in order to determine the fair values of all its property investments at

year-end. Such valuations were conducted on the basis of the market lease value (which consists of

capitalising net rents from each property and updating future flows). Acceptable discount rates were used

to calculate fair value for a potential investor, which are in keeping with those used by the market for

properties having similar characteristics and locations. The valuations were made in accordance with the

Appraisal and Valuation Standards published by the Royal Institute of Chartered Surveyors (RICS).

The key assumptions used to determine the fair value of these assets and their sensitivity analysis are

explained in Note 7.

Where an impairment loss is subsequently reverted, the asset's book value is increased up to the revised

estimate of its recoverable value in such a way as to ensure that the increased book value does not exceed

the book value that would have been determined if no impairment loss had been recognised in prior years.

Such reversion of an impairment loss is recognised as income.

5.4 Leases

Leases are classified as financial leases whenever it can be deduced from the lease agreements that the

risks and benefits inherent to owning the asset which is the purpose of the agreement are substantially

transferred to the lessee. All other leases are classified as operating leases. The Company had no financial

leases at year-end 2022 or 2021.

Operating leases

The expenses arising from the operating lease agreements are charged to the profit and loss account in the

financial year in which they accrue.

Likewise, any acquisition costs of the leased asset are reflected on the balance sheet in accordance with

their nature increased by the amount of any costs which may be directly stemming from the agreement,

which are recognised as an expense over the term of the agreement term by applying the same criterion

used to recognise revenue resulting from the lease.

Any charge or payment that may be made when entering into an operating lease is dealt with as an advance

charge or payment and charged to income over the lease's term as the profits of the leased asset are

progressively assigned or received.

5.5 Financial instruments

5.5.1 Financial assets

Classification

The financial assets owned by the Company are classified into the following categories:

a) Financial assets at amortised cost:

i. Loans and receivables: consisting of financial assets resulting from the sale of assets or

the provision of services for the Company's trade operations, or any that do not have their

origin in trade operations, are not equity instruments or derivatives and whose charges

are of a fixed or determinable amount and are not traded in an active market.

ii. The bonds and deposits set up by the Company in compliance with the contractual clauses

of the various lease agreements.

b) Financial assets at fair value through profit and loss: assets acquired with a view to disposing of

them in the short term or those that form part of a portfolio concerning which there is evidence of

recent activities with this in mind.

Initial valuation

Financial assets are initially booked at the fair value of the consideration handed over plus any transaction

costs that can be directly attributable to them.

Subsequent valuation

Financial assets at amortised cost are measured at their amortised cost. However, credits and debits linked

to commercial operations maturing in no more than one year, and that are not associated with a contractual

interest rate, in addition to, as applicable, advances and loans to staff, dividends receivable and

disbursements required in relation to equity instruments, the amounts of which are expected to be received

in the short term, and the disbursements required by third parties on their holdings, the amounts of which

are expected to be paid out in the short term, are measured at their nominal value when the effect of not

updating cash flows is not considered significant.

Financial assets at fair value through profit and loss are measured at their fair value, booking the result of

variations in said fair value in the profit and loss account.

At least at the close of the year, the Company conducts an impairment test on any financial assets not booked

at fair value. It is deemed that objective evidence for impairment exists if a financial asset's recoverable value

is less than its book value. When this comes about, the impairment is booked in the profit and loss account.

Generally speaking, the fair value considered by the company refers to a reliable market value.

The Company uses the observable prices of recent transactions involving the same asset measured as a

reference or using prices based on observable market data or indexes that are available and are applicable.

Thus, the following fair value hierarchy is established depending on the following levels of estimation:

a) Level 1: estimates that use unadjusted listed prices on active markets for identical assets or

liabilities, which the Company could assess on the measurement date.

b) Level 2: estimates that use listed prices on asset markets for similar instruments or other

measurement methods in which all significant variables are based on directly or indirectly

observable market data.

c) Level 3: estimates in which any significant variable is not based on observable market data.

More specifically, the criterion used by the Company to calculate the corresponding value corrections

concerning trade receivables and other accounts receivable, if any, consists of making an annual allocation

in the balances of a certain seasoning or in those in which circumstances come about that would reasonably

allow one to classify them as non-performing.

The Company writes off financial assets when they expire or when the rights over cash flows from the

financial asset in question have been assigned and the risks and benefits inherent to their ownership have

been substantially transferred.

Contrariwise, the Company does not write off financial assets in financial asset assignments where the risks

and benefits inherent to their ownership are substantially retained, recognising a financial liability equivalent

to the consideration received.

5.5.2 Financial liabilities

Classification

The financial liabilities owned by the Company are classified into the following categories:

- Financial liabilities at amortised cost: any debits and payables the Company has resulting from the

purchase of goods and services from the company's trade operations, or also any that do not have

a trade-related origin which cannot be considered as derivative financial instruments.

Financial liabilities at amortised cost are initially valued at the fair value of the consideration received,

adjusted by any transaction costs that can be directly attributed to them. Subsequently, such liabilities are

valued in accordance with their amortised cost.

The Company writes off financial liabilities when the obligations they have generated expire.

5.5.3 Hedge instruments

The Company uses derivative financial instruments to hedge the risks to which is activities, operations and

future cash flows are exposed. These risks arise from changes in interest rates. Within the framework of

these operations, the Company contracts hedging financial instruments.

For these financial instruments to qualify as hedge accounting, they are initially designated as such and the

hedging relationship is documented. Furthermore, the Company initially verifies, and continues to do so over

the course of its useful life (at least at the end of each year), that the hedge relationship is effective, in other

words, that the hedging ratio is the same as the hedging ratio used for the purposes of management, in other

words, it is the same as the ratio resulting from the amount of the hedged item that the company is actually

hedging and the amount of hedge instrument that the company actually uses to hedge said amount of the

hedged item. The part of the hedge instrument designated as an effective hedge could include an ineffective

residual part, provided that it does not reflect an imbalance between the weightings of the hedged item and

the instrument. This ineffective part shall be the same as the surplus variation in the value of the hedge

instrument designated as an effective hedge against the variation in the value of the hedged item.

The Company only applies cash flow hedges, which are accounted for as described below:

- Cash flow hedges: In this type of hedging, the profit or loss on the hedging instrument which has

been determined as effective hedging is temporarily recognised in equity, and charged to the profit

and loss account in the same period in which the item being hedged affects the results, unless the

hedge corresponds to a projected transaction which entails the recognition of a non-financial asset

or liability, in which case the amounts recorded in equity will be included in the cost of the asset or

liability when it is acquired or assumed.

The value of the derivatives reflects the fair market value of the derivatives at 31 December 2022. These

derivatives have been contracted to hedge the interest rate risk and that fair value represents the payment

which would have to be made if it were decided to sell them or transfer them to a third party.

The accounting for hedges is interrupted when the hedging instrument matures or is sold, finalised or

exercised, or no longer meets the criteria for hedge accounting. At that time, any cumulative gain or loss

corresponding to the hedging instrument which has been recorded in equity is held within equity until the

expected operation occurs. When the operation being hedged is not expected to occur, the cumulative net

gains or losses recognised in equity are transferred to the net results of the period.

5.6 Classification of balances into current and non-current balances

Current assets are deemed to be any assets linked to the normal operating cycle, which in general terms is

considered to be a year, along with any other assets whose maturity, disposal or realisation is expected to

come about in the short term from the date of the close of the year, along with cash and cash equivalents.

Any assets which do not meet these requirements are classified as non-current assets.

Similarly, current liabilities are those linked to the normal operating cycle and, in general terms, include all

obligations whose maturity or extinction will come about in the short term. Otherwise, they are classified as

non-current liabilities.

5.7 Income tax

After its amendment by Law 16/2012 of 27 December, the special tax regime for REITs is based on a zero

per cent Corporation Tax levy, provided certain requirements are met. Among these, it is worth highlighting

the requirement that at least 80% of assets must be comprised of urban properties designated for leasing

which are fully owned or acquired through interests in companies that meet the same investment and

distribution of results requirements, be they Spanish or foreign, whether or not they are listed on organised

markets. Likewise, the main sources of income of these entities must come from the property market, be it

from leases, the subsequent sale of real estate after a minimum maintenance period or the income from

interests in entities having similar characteristics.

Nonetheless, the tax is accrued proportionally to the distribution of dividends carried out by the company.

Any dividends received by the partners are exempt, except where the recipient is a legal person subject to

Corporation Tax or a permanent establishment belonging to a foreign entity, in which case a deduction has

been established for the total tax liability, so that such income is taxed at the partner's tax levy. However, the

remaining income will not be taxed while it is not paid out to the members.

As stipulated by the Ninth Transitional Provision of Law 11/2009 of 26 October governing Listed Real Estate

Investment Trusts, as amended by Law 16/2012 of 27 December, the entity will be subject to a special 19%

tax levy on the full amount of the dividends or profit sharing distributed to members whose interest in the

entity's share capital is equivalent to or greater than five percent, where such dividends at the registered

office of its members are exempted from tax or taxed at a levy below ten per cent. However, the special tax

levy shall not apply where the dividends or profit-sharing are received by other REITs, regardless of what

their percentage holding may be.

Hence, the Company has proceeded to apply a tax levy of 0% on the dividends shared out to its shareholders

since the aforementioned condition has been met.

Notwithstanding the foregoing, as indicated in Note 2, through Law 11/2021, of 9 July and Order

HFP/1430/2021, of 20 December, a special levy on undistributed profits by real estate investment trusts has

been approved within corporation tax, in the self-assessment category; companies choosing to apply for the

REIT tax system provided for in Law 11/2009 of 26 October shall be required to file this, with the profits to

be declared considered the undistributed profits during the year generated on income not taxed at the

general corporation tax rate, excluding income within the reinvestment period set out under Article 6(1)(b)

of Law 11/2009. This levy is considered corporation tax payable at the rate of 15% applicable to tax years

starting on or after 1 January 2021.

5.8 Income and expenses

Income and expenses are booked on an accrual principle, that is to say, when the real flow of goods and

services they represent comes about irrespective of the moment when the monetary or financial flows arising

from them are produced. Such income is valued at the fair value of the consideration received, deducting

any discounts and taxes.

The recognition of income from sales comes about at the moment the significant risks and benefits inherent

to ownership of the asset sold have been transferred without maintaining day-to-day management over such

asset, or retaining effective control over it.

Interest accrued on financial assets is recognised using the effective interest rate method. In any event, the

interest from financial assets accrued subsequent to the moment of acquisition is recognised as income in

the profit and loss account.

The income from real estate leases is booked on the basis of its accrual and the difference, if any, between

the invoicing carried out and the income recognised in keeping with this criterion is booked in the “Accrual

adjustments” item.

5.9 Provisions and contingencies

When drawing up the financial statements, the Directors of the Company have differentiated between:

a) Provisions: credit balances which cover current obligations arising from past events whose

cancellation will probably lead to an outflow of resources, but which cannot be determined as to

their amount and/or moment of cancellation.

b) Contingent liabilities: possible obligations arising as a consequence of past events, whose future

materialisation is conditional upon whether or not one or more future events which are beyond the

Company's control take place.

The financial statements reflect all the provisions regarding which the likelihood of having to face an

obligation is estimated to be higher than not having to do so. Contingent liabilities are not recognised in the

financial statements. Information about them, however, is provided in the notes to the notes to the statements

to the extent by which they are not deemed as remote possibilities.

Provisions are valued at the current value of the best possible estimate of the necessary amount to cancel

or transfer the obligation, taking into account available information on the event and its consequences, and

booking any adjustments that may arise due to the updating of such provisions as a financial expense as

they accrue.

5.10 Environmental asset elements

Environmental asset elements are deemed to be any assets which are used in a long-lasting manner in the

Company's operations and principal purpose is to minimise environmental impacts and to protect and

improve the environment, including reducing or eliminating future pollution.

By their very nature, the Company's operations do not have any significant environmental impacts.

5.11 Subsidies, donations and bequests

In order to book subsidies, donations and bequests received from third parties other than the owners, the

Company follows the following criteria:

a) Non-reimbursable capital grants, donations and bequests: These are valued at the fair value of the

amount or asset granted, depending on whether they are of a monetary nature or not. They are

charged to income in proportion to the depreciation allocation allocated in the period for subsidised

elements or, as appropriate, when their disposal or valuation allowance due to impairment comes

about.

b) Reimbursable subsidies: As long as they are deemed as reimbursable, they are booked as liabilities.

5.12 Related-party transactions

The Company performs all its transactions with related parties at market prices. Moreover, transfer prices

are properly documented. Hence, the Directors of the Company consider that there are no significant risks

which could give rise to considerable liabilities in the future due to this aspect.

6. Property, plant and equipment

The balances at 31 December 2022 and 31 December 2021 and the changes in the various property, plant

and equipment accounts and the related accumulated depreciation are as follows:

2022

Euros

Balance at

31/12/2021

Recognitions

Derecognitions

31/12/2022

Cost:

Data processing equipment

6,065

Furniture and fittings

9,109

Other fixtures

142,244

Total cost

6,065

151,353

157,418

Accumulated depreciation:

Data processing equipment

-4,913

-510

-5,423

Furniture and fittings

-152

Other fixtures

-2,370

Total accumulated depreciation

-4,913

-3,032

-7,945

Net property, plant and equipment

1,152

148,321

149,473

2021

Euros

Balance at

31/12/2020

Recognitions

Derecognitions

31/12/2021

Cost:

Data processing equipment

5,106

958

6,065

Total cost

5,106

958

6,065

Accumulated depreciation:

Data processing equipment

-4,212

-701

-4,913

Total accumulated depreciation

-4,212

-701

-4,913

Net tangible fixed assets

895

257

1,152

The main additions to property, plant and equipment in 2022 relate to investments in the Company’s offices

located on the second floor of Glorieta de Cuatro Caminos 6 and 7 in Madrid. Investments in 2022 totalled

151,353 euros (958 euros in 2021).

The depreciation charge of 3,032 euros (701 euros in 2021) was recognised in the income statement for the

year 2022 under “Depreciation and amortisation” in the accompanying profit and loss account as at 31

December 2022.

During the financial years 2022 and 2021, no finance charge has been capitalised under property, plant and

equipment. Also, at 31 December 2022 there are no capitalised finance charges of a material amount in

respect of property, plant and equipment.

At the end of the years ended 31 December 2022 and 31 December 2021, the Company had fully

depreciated property, plant and equipment in use. At year-end 2022, the acquisition cost of this equipment

amounted to 4,914 euros (2,969 euros in 2021).

The Company's policy is to take out insurance policies to cover the possible risks to which the various items

of its property, plant and equipment are subject. As at the year ended 31 December 2022, in the opinion of

the directors of the Company, there is no hedging deficit in respect of these risks.

As at 31 December 2022 and 2021, there are no commitments to purchase fixed assets or property outside

Spain.

As disclosed in Note 5.3, the Company has performed an impairment test to assess the possible existence

of impairments that reduce the recoverable amount of property, plant and equipment to an amount less than

their book value. As a result of this process, the Company has not recognised any impairment losses on

property, plant and equipment in 2022 and 2021.

7. Property investment

The movements in this item of the balance sheet, as well as the most significant information which affected

this item during 2022 and 2021 are as follows:

2022

Euros

Balance at

Disposals/

Balance at

31/12/2021

Additions

Reversals

Transfers

31/12/2022

Cost:

Properties for leases

465,038,907

39,363,304

-4,582,569

7,128,552

506,948,194

Ongoing real-estate investments

223,140

12,705,159

-7,128,552

5,799,747

Total cost

465,262,047

52,068,463

-4,582,569

512,747,941

Accumulated depreciation:

Properties for leases

-56,322,178

-5,982,921

527,392

-61,777,707

Total accumulated depreciation

-56,322,178

-5,982,921

527,392

-61,777,707

Impairment:

Properties for leases

-11,982,461

-664,400

185,405

-12,461,456

Total impairment

-11,982,461

-664,400

185,405

-12,461,456

Net property investments

396,957,408

45,421,142

-3,869,772

438,508,778

2021

Euros

Balance at

Disposals/

Balance at

31/12/2020

Additions

Reversals

Transfers

31/12/2021

Cost:

Properties for leases

434,028,550

42,049,544

-14,452,531

3,413,344

465,038,907

Ongoing real-estate investments

698,728

2,937,756

-3,413,344

223,140

Total cost

434,727,278

44,987,300

-14,452,531

465,262,047

Accumulated depreciation:

Properties for leases

-51,690,247

-5,689,081

1,057,150

-56,322,178

Total accumulated depreciation

-51,690,247

-5,689,081

1,057,150

-56,322,178

Impairment:

Properties for leases

-11,596,863

-492,932

107,334

-11,982,461

Total impairment

-11,596,863

-492,932

107,334

-11,982,461

Net property investments

371,440,168

38,805,287

-13,288,047

396,957,408

The distribution of the cost between the land and spread of the leased properties is as follows:

Cost at

31/12/2022

31/12/2021

Properties for leases

Land

241,654,180

223,996,157

Spread

265,294,014

241,042,750

Total cost

506,948,194

465,038,907

The “Real estate investments” item reflects the net cost of the real estate assets in use and operation and

leased through one or more operating leases, or the assets which are unoccupied but are destined to be

leased through one or more operating leases.

The main changes in this item during 2022 were as follows:

Investments: Property investments made in 2022 totalled 52,068,463 euros. The main additions recorded

under this heading relate mainly to the following investments:

- On 27 July 2022, the Company signed a public deed for the acquisition of two office buildings

located at Avda. de Cantabria 51 and Calle Santiago de Compostela 100 bis in Madrid, owned by

El Corte Inglés, S.A. (the former) and Ason Inmobiliaria de Arrendos, S.L. (the latter). The total cost

associated with these two transactions was 39,082,702 euros.

- There were additions to assets under construction amounting to 12,705,159 euros, corresponding

to the cost of renovating and refurbishing hotels amounting to 941,903 euros, the buildings at Calle

Arapiles 14 (5,785,510 euros), Pradillo 42 (177,999 euros) and Titán 13 (73,424 euros) in Madrid,

as well as the Sexta Avenida shopping centre (58,500 euros) and the start of construction work on

the Valdebebas Hospital and Hotel in Madrid (5,667,823 euros), which will be leased to Sanitas S.A.

de Hospitales and Melíá Hotels International, S.A., respectively, once completed.

- Furthermore, the Company has incurred in costs of 280,602 euros, capitalised as the cost of

property investment.

Disposals: Property write downs for the gross amount of 4,582,569 euros were undertaken. The main write

downs in 2022 correspond to:

- Sale of several properties with their corresponding annexes in Vallecas Comercial I (13 units),

Sanchinarro VII (8 units) and Coslada III (6 units) for a gross cost of 4,582,569 euros, which have

been sold to third parties. These sales transactions gave rise to a combined net gain of 350,824

euros, which was recognised under “Impairment and gains or losses on disposals of non-current

assets” in the profit and loss account at 31 December 2022.

Transfers: During the year, ongoing real-estate investments have been transferred to property investments

for the sum of 7,128,552 euros (3,413,344 euros in 2021), as a result of the completion of refurbishment

work on several hotels (941,903 euros) and the building at Pradillo 42 (379,579 euros). Also on 27 December,

the office building at Calle Arapiles 14 in Madrid was handed over to the tenant Ontreo (Grupo Planeta) on

the occasion of completion of the renovation of the building, which cost 5,807,070 euros.

Furthermore, the Company proceeded to appraise all of its real estate assets at year-end 2022 as stipulated

in the standards. Said appraisals, which were conducted by the independent expert Jones Lang LaSalle,

resulted in a fair value for some assets lower than their net book value. The Company has therefore

calculated the corresponding impairments.

Depreciation in 2022 came to 5,982,921 euros (5,689,081 euros in 2021), recognised under “Fixed asset

depreciation” on the Company’s income statement.

Fair value measurement and sensitivity

The methodology used by the independent appraiser in the valuations to determine the fair value of the

investment property has followed the RICS principles, which basically uses discounted cash flows as the

valuation method, consisting of capitalising the net income from each property and discounting the future

flows, applying market discount rates, over a ten-year time horizon and a residual value calculated by

capitalising the estimated income at the end of the projected period to an estimated yield. The buildings were

valued individually, taking into account each of the lease contracts in force at the end of the year and their

duration. Buildings with non-rented areas have been valued on the basis of estimated future income,

discounting a marketing period.

Also, for the ongoing property investments relating to the construction of the hospital and hotel in

Valdebebas, the Company has based its valuation on the value of the completed building or finished project

included in the independent valuer's valuation, which consists of comparing the value of the assets once

they are developed and in operation with the costs incurred at year end, plus the costs that will be incurred

until they are in operation. The management of the Company considers this valuation method to be

appropriate as there is no doubt that these projects will be carried out on the terms currently planned, as the

projects are already being implemented and the Company already has the necessary financing to carry them

out in their current configuration.

The valuation criteria applied were the same as those used in previous years. Similarly, the value of the

completed building was taken into account in the case of the Valdebebas hotel and hospital real estate

project under construction, which the company is currently developing.

The key variables of this method are the determination of net income, the duration of the leases, the period

of time during which the leases are discounted, the approximation to the value that is made at the end of

each period and the target internal rate of return-used to discount the cash flows.

The independent expert applies the following valuation methods to the property investments:

Valuation method

% according to GAV

Cash flow discount

25%

Capitalisation

70%

DCF and residual

Comparison

Total

100%

The key variables used in the valuations made using the discounted cash flow method are:

- Current income: the income generated by each property on the valuation date and considering

non-refundable expenses only for empty spaces.

- Estimated income for empty spaces and/or new leases during the years of the cash-flow.

- Exit Yield: rate of return required at the end of the valuation period for the sale of the asset. At the

end of the discount period an exit value has to be determined for the property. At that time it is not

possible to reapply a cash flow discount methodology and the sale value has to be calculated

according to an exit yield based on the income that the property is generating at the time of sale,

provided that the cash flow projection is understood to be a stabilized income that we can capitalise

on a perpetual basis.

- IRR: is the interest rate or return offered by an investment, the value of the discount rate that makes

the NAV equal to zero, for a given investment project.

- ERV: Market income of the asset at the valuation date.

2022

The main assumptions used to calculate the fair value of the real estate assets for 2022 were as follows:

Euros

Current Income

ERV

Exit Yield

IRR

Hotels

9,291,336

8,588,259

6.16%

8.07%

Offices

13,582,453

14,002,719

4.35%

N/A

Retail

7,256,979

6,454,183

3.41%

N/A

Shopping centres

3,334,260

3,121,368

8.03%

10.03%

2021

The main assumptions used to calculate the fair value of the real estate assets for 2021 were as follows:

Euros

Current Income

ERV

Exit Yield

IRR

Hotels

9,449,449

6,857,371

6.16%

8.07%

Offices

10,116,162

10,497,870

4.35%

N/A

Retail

6,938,178

7,019,315

3.41%

N/A

Shopping centres

3,591,666

3,001,072

8.03%

10.03%

The effect of a one-quarter of one point change in the required rates of return, calculated as income on the

market value of the assets, in the asset and in the profit and loss account, for the property investment under

operation, would be as follows:

Yield (Euros)

2022

2021

-0.25%

+0.25%

-0.25%

+0.25%

Hotels

3,200,000

-3,100,000

6,450,000

-5,730,000

Offices

16,430,000

-14,730,000

14,000,000

-12,440,000

Retail

15,990,000

-13,740,000

15,940,000

-13,700,000

Total

35,620,000

-31,570,000

36,390,000

-31,870,000

In addition, the sensitivity analysis of a 10% change in ERV (market rent on the asset at the valuation date)

would be as follows:

ERV (Euros)

2022

2021

-10%

+10%

Offices

-24,180,000

24,130,000

-18,810,000

18,990,000

Retail

-21,200,000

23,980,000

-19,070,000

19,060,000

Total

-45,380,000

48,110,000

-37,880,000

38,050,000

Lastly, the sensitivity analysis of a quarter point variation of the IRR would be as follows:

IRR (Euros)

2022

2021

-0.25%

+0.25%

Hotels

2,800,000

-2,700,000

2,670,000

-2,560,000

Commercial (shopping centre

only)

550,000

-530,000

350,000

-350,000

Land

400,000

-400,000

1,810,663

-1,911,294

Total

3,750,000

-3,630,000

4,830,663

-2,261,294

Valuation of real estate assets and impact on profit (loss) for the year:

Based on the valuations performed, there has been a negative net impact on the Company’s income

statement at 31 December 2022 for the sum of 478,996 euros (negative net impact of 385,598 euros at 31

December 2021); the breakdown by asset type and changes in provision for impairment of property

investments is as follows:

Euros

2022

2021

Balance at beginning of year

-11,982,461

-11,596,863

Hotels

-508,175

Offices

-73,668

Retail

-156,225

-419,264

Impairment

-664,400

-492,932

Offices

147,972

Retail

37,433

107,334

Reversals

185,405

107,334

Balance, end of year

-12,461,457

-11,982,461

Similarly, according to the valuations carried out, the fair value of investment property shows an

unrecognised unrealised gain (by comparing the updated gross fair market value and the net book value) of

239,361,554 euros (222,711,026 euros at 31 December 2021), in the case of the Company's entire portfolio,

with the exception of the Valdebebas assets, which show an unrealised gain of 35,655,694 euros (by

comparison between the gross market value of the completed project and the estimated total cost until

commissioning).

The gross market value of property investments at 2022 year-end amounted to 774,460,463 euros

(619,668,431 euros at 2021 year-end). The breakdown by business segment is as follows:

Gross market value of the

Property investments (Euros) (*)

31/12/2022

31/12/2021

Hotels (**)

204,000,000

147,040,000

Offices

285,681,522

231,411,637

Retail

211,478,941

214,157,401

Institutional (**)

73,300,000

Plots

27,059,393

Total

774,460,463

619,668,431

(*) The net market value at 31 December 2022 comes to 755,866,500 euros.

(**) In the case of Valdebebas projects, the market value of the completed project is included. Eliminating the impact of the inclusion of

the market values of the two completed projects and taking into account the market value based on the progress of work, the gross

market value of the property investment at year-end 2022 amounts to 680,358,044 euros, with a net value of 664,116,641 euros.

The breakdown of floor space in square metres above ground level (S.B.A.) of the property investments

owned by the Company was:

Floor area in m

above ground level

31/12/2022

31/12/2021

Hotels

99,408

80,135

Offices

62,406

45,861

Retail

40,852

40,736

Institutional

19,273

Total

221,938

166,732

At 31 December 2022, the average occupancy rate of the Company's leased assets was 92% (92% at 31

December 2021) based on the square metres leased.

The property investments described above are mainly located in Madrid, Castellón and Isla Canela,

Ayamonte in the province of Huelva.

Furthermore, the Companies' assets are affected by mortgage guarantees amounting to 62,461,471 euros

at 31 December 2022 (50,867,006 euros at 31 December 2021), corresponding to bank mortgage-backed

loans.

The breakdown of the mortgage loan balance pending maturity and repayment at 31 December 2022 and

2021 by assets is as follows:

Property

Euros

2022

2021

José Abascal, 41

9,690,000

10,374,000

Titán, 13

9,708,654

10,511,131

Conde de Peñalver, 16

6,303,992

6,825,054

Valle de la Fuenfría, 3

7,763,333

8,266,780

Juan Ignacio Luca de Tena, 17

10,545,492

11,090,040

Glorieta de Cuatro Caminos 6 and 7.

3,450,000

3,800,000

Arapiles 14

12,000,000

Hotel Valdebebas

3,000,000

Total value of mortgages pending maturity on assets (Note 13)

62,461,471

50,867,006

NB: The net book value of these mortgage-backed properties at 31 December 2022 amounted to 175,347,345 euros (125,883,498 euros

at 31 December 2021).

In 2022, the rental income from real estate investments belonging to the Company comes to 30,644,323

euros (24,081,817 euros in 2021). This figure includes income from the passing on of operating expenses

for all related items, which amounted to 1,047,429 euros in 2022 (910,905 euros in 2021).

At year-end 2022, there was no kind of constraint on making new real estate investments, or on collecting

the income arising from them or concerning the resources that could be obtained from a possible disposal.

At 2022 year-end, the Company had fully amortised property investments which were still in use amounting

to 8,811,387 euros (8,707,323 euros at 2021 year-end).

The Company's policy is to take out insurance policies to cover the possible risks that may affect its real

estate investments. At the end of 2022, there will be no shortfalls relating to any of the aforementioned risks.

8. Operating leases

At the end of 2022 and 2021, the Company had reached agreements with lessees on the following minimal

rental instalments in accordance with prevailing agreements, without taking into account the passing on of

condominium expenses, future increases in the CPI or any rent reviews agreed upon in their contracts.

The most significant operating leases stem from lease agreements on the real estate assets on which their

operations are based. A breakdown of such minimum rental instalments is set out below:

Euros

Nominal value

2022

2021

Less than a year

29,272,582

25,769,308

Between one and five years

87,953,936

80,884,702

More than five years

103,961,317

122,805,156

Total

221,187,835

229,459,166

With regard to the average duration of lease contracts by property type, the WAULT (Weighted average

unexpired lease term) is provided below:

WAULT

31/12/2022

31/12/2021

Hotels

8.64

9.01

Offices

6.52

6.81

Retail

11.07

11.74

Institutional

10.00

Total Average

9.09

9.39

9. Other financial assets and investments in related companies

The balances of the accounts in this item at year-end 2022 and 2021 are as follows:

Euros

Balance at

31/12/2022

31/12/2021

Financial assets at amortised cost

Derivatives

314,055

Other financial assets

2,706,786

2,576,870

Long-term / non-current

3,020,841

2,576,870

Other financial assets

341,488

166,906

Short-term / Current

341,488

166,906

Total

3,362,329

2,743,776

Euros

Balance at

31/12/2022

31/12/2021

Assets at fair value through

profit or loss

Other financial assets

16,478,110

13,399,701

Short-term / Current

16,478,110

13,399,701

Total

16,478,110

13,399,701

The movement in the headings “Other financial assets” and “Equity instruments” and “Derivatives” in the

short and long term during the financial years 2022 and 2021 is as follows:

2022

Euros

Balance at

Adjustment

Balance at

31/12/2021

Additions

Value

Disposals

31/12/2022

Equity instruments

13,399,701

5,995,506

-2,917,097

16,478,110

Derivatives

314,055

Other financial assets

2,743,776

937,232

-177,887

3,503,121

Total

16,143,477

6,932,738

-2,603,042

-177,887

20,295,286

2021

Euros

Balance at

Adjustment

Balance at

31/12/2020

Additions

Value

Disposals

31/12/2021

Loans to associated companies (Note 19.2)

2,450,366

-2,450,366

Equity instruments

13,058,645

341,056

13,399,701

Other financial assets

2,546,685

398,583

-201,492

2,743,776

Total

18,055,696

398,583

341,056

2,651,859

16,143,477

Assets at fair value through profit or loss

Equity instruments available for trading

In 2019 the Company purchased 6,950 shares in the listed company Unibail Rodamco, for a total acquisition

cost of 1,002,786 euros, which were recognised under “Short-term equity instruments”. At 31 December

2022, the Company valued these shares, obtaining a negative value adjustment of 90,281 euros, which was

recognised under “Results of trading portfolio” at 31 December 2022 (negative value of 20,572 euros in

2021).

In 2020, the Company purchased 1,572,296 shares in the listed company Inmobiliaria Colonial SOCIMI, S.A.,

for a total acquisition cost of 11,548,536 euros, which were recorded under “Short-term equity instruments”.

During the 2022 financial year, 1,113,250 shares with a total acquisition cost of 5,995,506 euros were

acquired, which are also recognised under “Short-term equity instruments”. At 31 December 2022, the

Company valued these shares, obtaining a negative value adjustment of 2,826,816 euros, which was

recognised under “Results of trading portfolio” (positive value of 361,628 euros in 2021).

During 2022, the Company received dividends associated with these financial investments for the sum of

377,351 euros (345,905 euros in 2021). This income is recognised in the Company’s income statement

under “Third-party financial income”.

The change in fair value, during the year and accumulated since it was originated, is shown below:

Financial assets at fair value through profit or loss

Euros

Cost

Acquisition

Fair value at

Change

Method

31/12/2021

31/12/2022

2022

31/12/2021

31/12/2022

2022

Level

Unibail Rodamco

1,002,786

428,259

337,979

-90,280

Listing

Inmobiliaria Colonial

SOCIMI, S.A.

11,548,536

17,544,042

5,995,506

12,971,442

16,140,131

3,168,690

Listing

Total

12,551,322

18,546,828

5,995,506

13,399,701

16,478,110

3,078,410

The main measurement techniques and variables used to measure fair value correspond to level 1, i.e., the

listing price of these shares on the secondary market at 31 December 2022.

Derivative

At 31 December 2022 there was an increase in equity of 314,055 euros due to the valuation of the derivative

financial instrument Interest Rate Swap (SWAP). This amount is related to the heading Hedging instruments

in Note 15.

Current and non-current financial assets amortised cost

The headings “Other non-current financial assets” and “Other current financial assets” include guarantees

received from customers deposited with the relevant public authorities in connection with the leases

disclosed in Note 8 and a current amount of 454,848 euros relating to the cost of setting up loans taken out

by the Company in 2022 and still to be settled by the lending institution's' management.

The breakdown by due dates of the entries that comprise the “Other non-current financial assets” item at 31

December 2022 is as follows:

Euros

2027

2023

2024

2025

2026

and subsequent

Total

Other financial assets

796,335

579,857

185,487

392,845

1,548,597

3,503,121

Total

796,335

579,857

185,487

392,845

1,548,597

3,503,121

The breakdown by maturity at 31 December 2021 is as follows:

Euros

2026

2022

2023

2024

2025

and subsequent

Total

Other financial assets

166,906

70,387

552,581

164,995

1,788,908

2,743,776

Total

166,906

70,387

552,581

164,995

1,788,908

2,743,776

10. Trade and other accounts receivable

The breakdown of the item at year-end 2022 and 2021 was as follows:

Euros

31/12/2022

31/12/2021

Accounts receivable for sales and services

4,174,532

3,607,767

Trade and other accounts receivable

20,017

Staff

944

480

Current tax assets (18.2)

20,362

7,346

Other credits with Public Administrations (Note 18.1)

9,837

Total

4,205,675

3,635,610

The balance of the “Accounts receivable for sales and services” can be broken down as follows, for year-

end 2022 and 2021:

Euros

31/12/2022

31/12/2021

Customers

3,848,969

3,070,217

Commercial paper in portfolio

314,446

328,664

Outstanding papers

11,117

208,886

Customers with doubtful debts

3,494

3,665

Impairment

-3,494

-3,665

Total

4,174,532

3,607,767

The customer balance at the end of 2022 primarily includes some of the amounts pending payment

corresponding to income from the fourth quarter of 2022 in addition to the variable income from specific

hotels belonging to the Company that is calculated and invoiced at the end of the year based on GOP and

income for the year.

The change in the impairment of registered customers is as follows, with a gain of 171 euros recognised in

the income statement in 2022 (gain of 6,456 euros in 2021):

Euros

2022

2021

Balance at beginning of year

-3,665

-10,121

Impairment of customers

-3,494

-2,094

Reversal of commercial credits

3,665

8,550

Balance, end of year

-3,494

-3,665

11. Cash and cash equivalents

The balance stated under “Cash” primarily corresponds to the balance available in current accounts on 31

December 2022 and 2021. The availability of these balances is subject to no restrictions and they accrue

interest at market rates.

12. Information on the nature of financial instruments and their level of risk

The management of the Company's financial risks is centralised in the Group's Financial Management and

PER 32 Group policies, which has established the necessary mechanisms to control exposure to changes in

exchange rates, along with credit and liquidity risks. The main financial risks which impact the Company are

set out below:

a) Credit risk

The Company's main financial assets are cash flow and cash balances, trade creditors and other accounts

receivable in investments. These account for the Company's maximum exposure to credit risk as regards

financial assets. The Company's credit risk is mainly attributable to its trade debts, which are shown net of

any provisions for insolvencies estimated on the basis of prior years' experience and their valuation under

the current economic climate. The Company loans its excess liquidity to related companies which are very

solvent, thereby guaranteeing the repayment of the funds thus loaned.

b) Liquidity risk

Taking into account the current situation of the financial market and the estimates made by the Directors of

the Company on the Company's cash generating capacity, the Directors believe that the Company has

enough capacity to obtain financing from third parties were it necessary to make new investments.

Consequently, there is no evidence that the Company will encounter liquidity problems in the medium term.

Liquidity is guaranteed by the nature of the investments made and lessees' high credit ratings, as well as by

the collection guarantees set forth in prevailing agreements.

c) Exchange rate risk

As regards the Company's exchange rate risk at 31 December 2022, it did not have any assets or liabilities

in foreign currencies. Hence, there is no risk in this regard.

d) Interest rate risk

The Company has two long-term loans financing mainly long-term assets, as well as short-term working

capital financing facilities. The risk of interest rate fluctuations is very low since the Company is not highly

exposed to debt. The Company's policy on interest rates consists of not taking out interest rate hedges

through hedging financial instruments, swaps, etc., since any change in interest rates would have an

insignificant effect on the Company's results, taking into account its low debt levels and today's very low

interest rates.

However, on 17 February 2017, the Company arranged an interest rate swap for 8,550,000 euros, which will

be valid from 1 April 2019 to 1 April 2026 and linked to a mortgage loan of 11,400,000 euros taken out in

2017 on the property located in calle José Abascal 41 in Madrid.

e) Real estate business risks

Changes in the economic situation at both local and international levels, occupation and employment growth

rates, interest rates, tax legislation and consumer confidence have a significant impact on the real estate

markets. Any unfavourable change in any of these or in other economic, demographic or social variables in

Europe, and Spain in particular, could lead to a reduction in real estate activity in these countries. The cyclical

nature of the economy has been statistically proven, as has the existence of microeconomic and

macroeconomic aspects that directly or indirectly affect the way the property market performs, particularly

the rentals which make up the Company's main investment activity.

Other market risks to which the Company is exposed include:

• Regulatory risks: the Company is bound to comply with several general and specific legal

provisions in force (legal, accounting, environmental, employment, tax, data protection provisions,

among others) which apply to it. Any regulatory changes that come about in the future may have a

positive or negative effect on the Company.

• Tourism risk: a significant part of the Company's assets (mainly hotels) are connected to the

tourism industry. Any drop in tourism activity in the cities where these hotels are located could have

a negative effect on hotel use and occupancy. As a result, this could have a negative effect on the

yield and performance of these assets if tenants renegotiate current lease agreements.

13. Total equity and shareholders' equity

a) Authorised capital

At 31 December 2022, the Company's subscribed share capital was comprised of 4,452,197 registered

shares at a par value of €60.10 each. All these shares belong to a single class and series and all have been

fully subscribed and paid up, which means that the Company's registered share capital amounts to

267,577,040 euros.

All the shares that make up the share capital have the same rights, there being no statutory restrictions on

their transferability.

All the Company's shares have been admitted to trading on the Luxembourg Stock Exchange since 21

December 2011. The year-end share price, the average share price in the last quarter of the year and the

average for 2022 were 65.00, 65.34 and 65.80 euros per share, respectively.. The shares are registered

shares and are represented by means of book entries. They are constituted as such by virtue of their

registration in the corresponding accounting record.

The shareholders shall be subject to the obligations set forth in Articles 10 and comply with the REIT Act.

Any shareholders whose interest in the entity's share capital is equivalent to or greater than five per cent and

who receive dividends or a share-out of profits are obliged to give the company notice of the tax levy on the

dividends received within ten days, counting from the date after the day they are received.

The companies holding an interest in the share capital equivalent to or greater than 10% at 31 December

2022 were as follows:

Number of

Percentage

Interest

Promociones y Construcciones PYC Pryconsa, S.A.

498,360

11.19%

Cogein, S.L.U.

448,807

10.08%

b) Reserves

Legal reserve

According to the Consolidated Text of the Corporate Enterprises Act, a figure equivalent to 10% of the profit

for the year has to be allocated to the legal reserve until the balance of this reserve reaches at least 20% of

share capital. The legal reserve may be used to increase capital by using the proportion of its balance which

exceeds 10% of the already increased capital.

Furthermore, pursuant to Law 11/2009 regulating real estate investment trusts (REITs), the legal reserve of

companies that have chosen to apply the special tax regime established by this Law may not exceed 20% of

their share capital. The articles of these companies may not establish any unavailable reserve other than the

legal reserve.

With the exception of the aforementioned use, and whilst it does not exceed 20% of the share capital, this

reserve may only be used to offset losses, and only when there are no other sufficient available reserves to

do so.

At 31 December 2022, the legal reserve had not yet been fully allocated.

Voluntary reserve

Following the distribution of the Company’s profit in 2021, the balance of this equity item came to 4,798,646

euros; this reserve unrestricted.

Merger reserve

As a result of the merger operation carried out in 2016 set out in Note 1, in 2016 merger reserves of

14,154,739 euros were provided for, generated on account of the difference between the individual book

values of the Absorbed Companies and the book values incorporated as part of the merger.

c) Interim dividend

During 2022, no interim payment of dividends was received.

d) Distribution of profits

REITs are governed by the special tax regime set forth in Law 11/2009 of 26 October governing Listed Real

Estate Investment Trusts, as amended by Law 16/2012 of 27 December. Once all the trading obligations that

may correspond to them are fulfilled, such companies are obliged to distribute to their shareholders the

profits obtained in the year in the form of dividends. Such distribution must be resolved as set out below

within the six months following the end of each financial year:

a) 100% of the profit from dividends or profit-sharing distributed by the entities referred to in section

1, article 2 of this Law.

b) At least 50% of the profits arising from the transfer of the properties, shares or ownership interests

referred to in section 1, article 2 of this Law, subsequent to expiry of the time limits referred to in

section 3, article 3 of this Law, which are used for pursuit of the entities' principal corporate

purpose. The rest of such profits must be reinvested in other properties or interests included under

the corporate purpose within the three years following the date of transfer. Failing this, such profits

must be fully distributed together with the profits, if any, from the year in which the reinvestment

period ends. Should the elements subject to reinvestment be transferred before the maintenance

period elapses, any profits from them must be fully distributed jointly with the profits, if any, of the

financial year in which they have been transferred. The distribution obligation does not cover the

proportion of profits, if any, charged to financial years in which the Company did not pay taxes

under the special tax regime set forth by the aforementioned Act.

c) At least 80 per cent of the rest of the profits obtained.

Where the distribution of dividends is charged to the reserves from the profits of a year in which the special

tax regime has been applied, the distribution of such dividends must necessarily fulfil the resolution referred

to in the preceding paragraph.

The legal reserve of any companies which have opted to apply the special tax regime set forth in this Act

may not exceed twenty per cent of their share capital. The articles of these companies may not establish any

other unavailable reserve other than the legal reserve.

As indicated in Note 2, pursuant to Law 11/2021, of 9 July and Order HFP/1430/2021, of 20 December, the

Company is subject to special taxation on undistributed profit by real estate investment trusts as part of

corporation tax, in the self-assessment category, for tax years starting on or after 1 January 2021. The tax

rate in force is 15% and is considered as corporation tax payable.

e) Capital management

The Company is essentially financed with shareholders' equity. Only in the case of new investments may the

Company make use of the credit markets to finance these acquisitions or obtain financing from related

companies by taking out mortgage-backed loans and/or issuing fixed income financial instruments.

The Company has undertaken to distribute at least 80% of their distributable profits in the form of dividends

to its shareholders pursuant to the existing legal obligation laid down by Law 11/2009, as amended by Law

16/2012.

f) Adjustments for changes in value

The breakdown and nature of other adjustments for changes in value is as follows:

Euros

31/12/2022

31/12/2021

Hedging operations (Note 14)

-314,055

283,008

Total

-314,055

283,008

g) Capital grants

The activity in this heading during 2022 and 2021 was as follows:

2022

Euros

31/12/2021

Applications

31/12/2022

Capital grants

985,139

-56,351

928,789

Total

985,139

-56,351

928,789

2021

Euros

31/12/2020

Applications

31/12/2021

Capital grants

1,041,490

-56,351

985,139

Total

1,041,490

-56,351

985,139

Due to the change in taxation pursuant to the amendment introduced by Law 16/2012 of 27 December to

Law 11/2009 regulating Listed Real Estate Investment Trusts on the Real Estate Market, the Company started

to pay tax at the levy of 0%. Therefore, the Company has adjusted the tax effect or the deferred tax liability

and included the gross amount in “Subsidies, donations and bequests” of the Company's equity.

These subsidies correspond to the subsidy granted by the Directorate-General of Regional Economic

Incentives for the development of the area. At 31 December 2022, the following were yet to be taken to the

statement of profit and loss:

- Subsidy granted by the Directorate-General of Regional Economic Incentives for the nominal

amount of 1,550,000 euros (581,814 euros yet to be taken to the statement of profit and loss)

corresponding to 10% of the investment made to build Hotel Iberostar Isla Canela in Ayamonte,

Huelva.

- Subsidy granted by the Directorate-General of Regional Economic Incentives for the nominal

amount of 1,106,000 euros (346,975 euros yet to be taken to the statement of profit and loss)

corresponding to 10% of the investment made to build Hotel Playa Canela in Ayamonte, Huelva.

The aforementioned subsidies were transferred to the Absorbed Company, Compañía Ibérica de Bienes

Raíces 2009, SOCIMI, S.A.U. from Isla Canela, S.A. based on the partial division agreement which gave rise

to the Absorbed Company, since all of them were allocated to the activity subject to the transfer. Taking into

account that the partial division transaction mentioned above was performed with accounting effects as of 1

January 2009, the Absorbed Company has booked the subsidies thus transferred in income since then.

In 2022, an amount of 56,351 euros (56,351 euros in 2021) was registered under “Allocation of grants for

non-financial and other assets” in the accompanying profit and loss account.

14. Current and non-current liabilities

The balances of the accounts in this item at the end of 2022 and 2021 are as follows:

Euros

31/12/2022

31/12/2021

Long-term debts with credit institutions

104,798,848

80,987,013

Derivatives (Note 15)

283,008

Other financial liabilities

3,900,223

3,670,947

Total long-term liabilities

108,699,071

84,940,968

Bonds and debentures

2,026,165

Short-term debts with credit institutions

35,026,384

15,343,959

Other financial liabilities

488,482

599,852

Total current payables

35,514,866

17,969,976

Total current and non-current financial debts

144,213,937

102,910,944

Financial assets at amortised cost

Bonds and debentures

The heading “Bonds and debentures” includes the two issues of fixed-income securities carried out by the

Company in 2016 under the “Fixed-income securities issuance programme 2015” for a total amount of

10,000,000 euros, which were fully repaid on 23 June 2022 with the payment of the annual coupon and the

repayment of the bond of 2,000,000 euros maturing on the same date.

The expenses incurred each year in connection with the issue, registration and maintenance of fixed-income

securities programs are registered in the Company's income statement for each year, due to their

immateriality. At 31 December 2022, these expenses amounted to 12,696 euros (44,419 euros at 31

December 2021). There have been no placement costs or fees.

These financial liabilities, recognised under “Debits and payables”, are measured at year-end at their

amortised cost and their carrying value at each reporting date are an acceptable approximation of their fair

value.

Non-current and current bank borrowings

At 31 December 2022, the Company’s bank borrowings came to 139,825,232 euros (96,330,972 euros at

31 December 2021).

The mortgage loans in force at 31 December 2022, for which the Company is liable, have the following

characteristics:

Financial institution

Euros

Start

Initial amount

Outstanding capital

Maturity

José Abascal, 41

Banca March

2017

11,400,000

9,690,000

2031

Titán, 13

Banco Santander

2015

15,735,000

9,708,654

2025

Conde de Peñalver, 16

Banco Santander

2015

10,217,000

6,303,992

2025

Valle de la Fuenfría, 3

Kutxabank

2018

10,000,000

7,763,333

2028

Juan Ignacio Luca de Tena, 17

CaixaBank

2019

12,000,000

10,545,492

2030

Glorieta de Cuatro Caminos 6 and 7,

Banca March

2018

4,500,000

3,450,000

2028

Arapiles 14 (*)

Bankinter

2022

24,000,000

12,000,000

2037

Hotel Valdebebas (*)

Banco Santander

2022

33,000,000

3,000,000

2035

Total

120,852,000

62,461,471

Opening costs

Bankinter

2022

-315,555

Total

120,852,000

62,145,916

(*) These loans are intended to finance renovation and construction work. The loan to finance the renovation of the Arapiles 14 building has

been agreed with Bankinter and is awaiting a final drawdown of 12,000,000 euros, which should take place in the first quarter of 2023. The

loan for the Valdebebas Hotel was agreed with Banco Santander and the drawdown of up to 33,000,000 euros will take place during the

building's construction years, based on the progress of construction.

The personal guaranteed loans in force at 31 December 2022 have the following characteristics:

Start

Euros

Maturity

Initial amount

Outstanding capital

Banco Santander

2020

12,000,000

9,069,341

2025

Banco Santander

2021

30,000,000

24,461,457

2026

Banco Santander

2022

10,000,000

2023

Abanca

2022

3,000,000

2,700,000

2027

Pichincha

2022

5,000,000

4,183,178

2025

Banca Pueyo

2022

5,000,000

2030

Banca Pueyo

2022

5,000,000

2030

Bankinter

2022

10,000,000

2032

Total

80,000,000

70,413,976

In addition, the heading “Short-term bank borrowings” includes two credit facilities concluded with Bankinter,

one with a limit of 2,000,000 euros and the other with a limit of 5,000,000 euros, both maturing on 26 October

2023. From these credit facilities, a total of 6,872,437 euros had been drawn down at 31 December 2022.

Furthermore, accrued and unpaid interest at 31 December 2022 came to 392,903 euros (158,289 euros at

31 December 2021).

The financial expenses arising from debts with credit institutions in 2022 amounted to 1,914,180 euros

(1,772,748 euros in 2021) and are recorded under the “Financial expenses” heading on the attached profit

and loss account.

As can be seen from the information described in this note, the Company has taken out various long-term

loans (mortgages and non-mortgage loans) in 2022 to finance its activities. The cost of closing these loans

is included in “Long-term debts with credit institutions” in the Company's balance sheet as at 31 December

2022 and amounts to 315,555 euros, which is recorded annually as an expense in the income statement

according to the repayment period of the loans to which they are linked. In addition, the heading “Other

financial assets” (see Note 9) includes a balance of 454,848 euros corresponding to the cost of setting up

loans signed by the Company in 2022 and still to be formalised by the administration of the lending financial

institution.

Loan interest rates are set on market terms linked to Euribor with a fixed spread, with the exception of the

loan hedged with a hedge guarantee.

The “Bonds and deposits” item reflects the guarantees received from clients connected with the leases set

out in Note 7.

The breakdown by due dates at 31 December 2022 is as follows:

Euros

2027

2023

2024

2025

2026

and

subsequent

Total

Debts with credit institutions (*)

35,026,384

19,703,541

31,505,107

8,827,366

44,762,834

139,825,232

Long-term bonds and deposits

448,430

205,388

1,412,640

1,833,765

3,900,223

Short-term bonds and deposits

488,482

Total

35,514,811

20,151,971

31,710,496

9,266,692

47,569,913

144,213,882

(*) Mortgage-backed loans in the amount of 62,461,471 euros, loans with a personal guarantee in the amount of 70,413,976 euros,

drawdowns on credit facilities in the amount of 6,872,437 and interest accrued pending maturity in the amount of 392,903 euros.

The breakdown by due dates at 31 December 2021 is as follows:

Euros

2026

2022

2023

2024

2025

and

subsequent

Total

Bonds and debentures

2,000,000

Debenture and bond interest

26,165

Debts with credit institutions (*)

15,343,959

13,988,663

14,148,068

26,369,099

26,481,184

96,330,972

Long-term bonds and deposits

106,510

1,325,594

183,327

2,055,516

3,670,947

Short-term bonds and deposits

599,852

Derivatives

283,008

Total

17,969,976

14,095,173

15,473,662

26,552,426

28,819,708

102,910,944

(*) Mortgage-backed loans in the amount of 50,867,006 euros, loans with a personal guarantee in the amount of 42,000,000 euros,

drawdowns on credit facilities in the amount of 3,305,677 and interest accrued pending maturity in the amount of 158,289 euros.

15. Hedge instruments

The breakdown of derivative financial instruments at 2022 year-end is as follows:

Euros

Fair value

Classification

Type

Outstanding

balance

Maturity

Asset

Interest rate swap

Interest rate hedge

Variable to Fixed

8,550,000

01.04.2026

314,055

The breakdown of derivative financial instruments at 2021 year-end is as follows:

Euros

Fair value

Classification

Type

Outstanding

balance

Maturity

Liability

Interest rate swap

Interest rate hedge

Variable to Fixed

8,550,000

01.04.2026

283,008

On 17 February 2017, the Company entered into an Interest Rate Swap derivative financial instrument

amounting to 8,550,000 euros, the term of which is from 1 April 2019 to 1 April 2026.

This financial instrument has had the following impact on the Company's equity, according to the valuation

made:

- An equity increase of 597,063 euros in 2022 (283,008 euros in 2021), which has been recorded in

the Company's equity under the “Adjustments for changes in value” item.

The Company has complied with the requirements set out in Note 5.5.3 on registration and valuation

standards to be able to classify the financial instruments detailed above as hedges.

16. Disclosure on supplier payment deferrals

Below is the information required by Additional Provision Three of Law 15/2010 of 5 July (modified under

the Second Final Provision of Law 31/2014 of 3 December) prepared according to the Resolution of 29

January 2016, of the Institute of Accounting and Auditing, on the information to be included in the record of

annual financial statements relating to the average period for payment to suppliers in commercial

transactions.

2022

2021

Days

Average payment period to suppliers

44.48

41.78

Ratio of paid transactions

49.84

44.27

Ratio of transactions pending payment

21.88

27.43

Euros

Total payments made

15,562,518

6,777,911

Total payments pending

3,689,510

1,174,472

Pursuant to the ICAC Resolution, to calculate the average payment period to suppliers, commercial

transactions corresponding to the accrued delivery of goods or provision of services from the date on which

Law 31/2014 of 3 December came into force, have been taken into consideration.

For the sole purpose of providing the information set out in the Resolution, suppliers are considered as trade

creditors concerning debts with suppliers of goods or services, included in the “Suppliers” and “Sundry

creditors” items of the current liabilities in the balance sheet.

The “average payment period to suppliers” is understood as the period of time that elapses from the delivery

of goods or the provision of services entrusted to the supplier and eventual payment of the operation.

The maximum legal payment period applicable to the Company in 2020 according to Law 3/2004, of 29

December, establishing measures to combat delinquency in commercial transactions, is 30 days from the

date on which said Law was published to the present (unless any of the conditions established therein are

fulfilled, allowing the maximum legal payment period to be extended to 60 days).

In accordance with Law 18/2022 of 28 September on the creation and growth of companies, the aim of which

is to reduce non-payment and financial support, the company discloses below the average time taken to pay

suppliers, the volume of money and the number of invoices paid in a period that is less than the maximum

set in the late payment regulations, as well as the percentage that these represent of the total number of

invoices and total money paid to its suppliers:

2022

Average payment period – invoices paid in a period shorter than the legal maximum period

26.09

Number of invoices paid in less than the maximum legal period

1,520

Percentage of total number of paid invoices

66.61%

Euros

Amount of invoices paid in less than the legal maximum time limit.

13,037,097

Percentage of the total amount of paid invoices

83.77%

17. Guarantees undertaken with third parties

At 31 December 2022, the Company has a guarantee from Kutxabank to the Madrid City Council for the

proper disposal of waste in the amount of €6,431 for the specific refurbishment of the building at 42 Calle

Pradillo.

18. Public administrations and tax situation

18.1. Current balances with Public Administrations

The breakdown of the accounts receivable and payable from/to Public Administrations is as follows:

Euros

31/12/2022

31/12/2021

Owed

Due

Owed

Due

Withholdings during the year

20,362

7,346

Withholdings from previous years

9,837

Value Added Tax

306,938

755,463

Personal Income Tax

51,381

20,971

Rent withholdings

505

Withholdings on movable capital

30,287

Social Security

7,483

6,462

Total

30,199

396,594

7,346

782,896

The net result of the corporate income tax for 2021 increases by 2,491 euros (from 7,346 euros to 9,837

euros) due to the withholdings on the real estate capital of the community of owners of Glorieta de Cuatro

Caminos 6 and 7, received after the end of the year but included in the calculation of the tax and the refund

requested in July 2022.

The notice of refund from the tax authority was received on 6 February 2023. The notification shows a

surcharge of 9 euros for interest on arrears, so that the total net amount of the refund is 9,846 euros.

18.2 Reconciliation between accounting profit or loss and the tax base

The reconciliation between the accounting profit or loss and the Corporation Tax base in 2022 and 2021 was

as follows:

Euros

2022

2021

Profit (loss) before tax

14,254,856

21,824,771

Permanent differences

Temporary differences

162,102

219,312

Prior tax base

14,416,958

22,044,083

Tax base (0%)

14,416,958

22,044,083

Tax base (25%)

Offsetting of negative tax bases

Tax base at 0%

14,416,958

22,044,083

Tax base at 25%

Total tax liability (0%)

Total tax liability (25%)

Withholdings and interim payments

20,362

7,346

Net (payable)/refunded

20,362

7,346

Temporary differences in 2022 that changed the pre-tax accounting profit amounted to 162,102 euros and

corresponded to:

- Downward adjustment for the recovery of the depreciation allocation for non-deductible property

investments pursuant to Law 16/2012, establishing that accounting depreciation of tangible and

intangible fixed assets, in addition to property investments, were only deductible up to 70% of the

depreciation that would have been fiscally deductible recovering, from 2015, on a 10-year straight-

line basis, the amount of 441,736 euros.

- Upward adjustment for the impairment of property investments in 2022 in the amount of 664,400

euros.

- Downward adjustment as a consequence of the reversal of impairment on real estate investments

amounting to 111,101 euros.

- In 2022, amortisation of the goodwill arising from the merger (see Note 1) in the year was

recognised as a temporary difference amounting to 50,538 euros.

At the end of 2022, the Company has temporary differences pending allocation of 5,847,095 euros

(5,518,708 euros in 2021), for which the deferred tax asset has not been booked given that the levy

applicable is 0%. Said temporary differences include the amount of adjusted depreciation in 2013 and 2014

pending deduction in the amount of 425,558 euros, in addition to the impairment of property investments in

the amount of 5,421,537 euros.

At 31 December 2022, the Company had tax bases to be offset of 357,592 euros (357,592 euros at 31

December 2021).

At the end of 2022, there were no financial expenses that have not been deducted from the tax base for

corporation tax.

Furthermore, at 31 December 2022, tax credits yet to be applied were recognised for the sum of 453 euros

(same amount at 31 December 2021).

Pursuant to Article 9.2 of Law 11/2009 of 26 October governing Listed Real Estate Investment Trusts, as

amended by Law 16/2012 of 27 December, the tax self-assessment return has to be filed on the part of the

period's tax base which proportionally corresponds to the dividend whose distribution has been resolved

with regard to the profit obtained in the year. As indicated in Note 4, at 2022 year-end the directors proposed

to the shareholders to pay dividends of 12,653,959 euros (15,148,123 euros in 2021) and, accordingly,

corporation tax was payable on this dividend in the amount of 0 euros.

Furthermore, pursuant to Article 6 of Law 11/2009 of 26 October, amended by Law 16/2012 of 27 December,

the Company is obliged to distribute dividends equal to at least 50 percent of the profits resulting from the

transfer of the real estate assets and shares or interests referred to in paragraph 1, Article 2 of said Law

which are carried out once the periods referred to in paragraph 3, Article 3 of this Law have elapsed and

which are allocated to fulfilling its main corporate purpose. The rest of such profits must be reinvested in

other properties or interests included under the corporate purpose within the three years following the date

of transfer. Failing this, such profits must be fully distributed together with the profits, if any, from the year in

which the reinvestment period ends. If the elements subject to reinvestment are transferred before the

maintenance period established in paragraph 3, article 3 of this Act elapses, those profits must be fully

distributed together with the profits, if any, from the year in which they have been transferred.

To this end, in 2022 the Company recognised income on the sale of real estate assets for the sum of 350,824

euros following the sale of the various developments in Vallecas, Sanchinarro and Coslada (8,988,341 euros

in 2021 of net profit following the allocation of transaction costs incurred as part of the sale of the property).

During 2022, more than 50% of the profit obtained on said sale was reinvested in real estate assets, meaning

that the reinvestment requirement indicated above has been complied with.

Corporation tax expenditure

Following the application of Law 11/2021, of 9 July and Order HFP/1430/2021, of 20 December approving

the “special taxation on undistributed profit by real estate investment trusts” as part of corporation tax in the

self-assessment category, the Company has not set aside provisions for corporation tax until the Company's

General Shareholders Meeting approves the distribution of profit for 2022.

Additional information on Deferred Income

A. Compañía Ibérica de Rentas Urbanas 2009, SOCIMI, S.A.U.

Compañía Ibérica de Rentas Urbanas 2009, SOCIMI, S.A.U. was incorporated as a result of the partial spin-

off of the company, Cogein, S.L. (now S.L.U.) which took place on 22 December 2009. The assets

contributed by Cogein, S.L. (now S.L.U.) were subject to the tax neutrality regime.

Pursuant to the foregoing, in order to comply with the provisions of Article 86 of the LIC, the following

information is hereby included:

a) Tax period in which the transferor, Cogein, S.L. (now S.L.U.) acquired the transferred assets:

- Hotel Tryp Atocha: 2001 (sold in 2015)

- Rutilo premises: 2000 (sold in 2019)

- Hotel Innside Meliá Gran Vía: 2002

- Retail outlet at Gran Vía 34: 2002

- Retail outlet on Dulcinea: 1995

- Pradillo 42 offices: 2009

- Albalá 7 premises: 2003

- Gran Vía 1 1º and 2º derecha offices: 1993

- Gran Vía 1 1º izquierda premises: 1998

b) List of assets acquired that are included in the accounting records for a value different to that for

which they were included in those of the transferor entity prior to the transaction being carried out,

indicating both values, as well as the valuation adjustments made to the accounting records of the

two entities:

Data at 31 December 2022

Property

Euros

N.T.V.:

M.V.T.:

R.D.

Gran Vía,1 1º izquierda

541,883

2,730,000

2,188,117

Gran Vía,1 1º derecha

474,791

3,013,000

2,538,209

Gran Vía,1 1º izquierda

570,505

2,873,000

2,302,495

Gran Vía 34 hotel and premises

45,845,703

43,065,500

-2,780,203

Dulcinea premises

446,843

1,525,000

1,078,157

Albalá 7 premises

846,985

2,873,300

2,026,315

Pradillo, 42

17,762,500

18,227,308

464,808

Total

66,489,210

74,307,108

7,817,898

N.T.V.: Net tax value

M.V.T.: Market value of transfer

R.D. Deferred income

c) No tax benefits are enjoyed by the transferor entity concerning which the absorbed entity must

comply with specific requirements pursuant to the provisions of Article 84.1 of the Corporation Tax

Act (“LIS”).

B. Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U.

Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U. was established following the partial division of

Isla Canela, S.A., which occurred on 29 December 2009. The assets contributed by Isla Canela, S.A. were

treated under the tax neutrality system.

Pursuant to the foregoing, in order to comply with the provisions of Article 86 of the LIC, the following

information is hereby included:

a) Tax period during which the transferring entity, Isla Canela, S.A., acquired the transferred assets:

- Gran Vía 1 2º izquierda: 1987

- Marina Isla Canela Shopping Mall: 2000

- Hotel Barceló: 1998

- Hotel Atlántico: 2000

- Hotel Playa Canela: 2002

- Hotel Iberostar: 2002

- Hotel Golf Isla Canela: 2007

b) List of assets acquired that are included in the accounting records for a value different to that for

which they were included in those of the transferor entity prior to the transaction being carried out,

indicating both values, as well as the valuation adjustments made to the accounting records of the

two entities:

Data at 31 December 2022

Property

Euros

N.T.V.:

M.V.T.:

R.D.

Gran Vía 1 2º izquierda

374,654

1,940,000

1,565,346

Marina Isla Canela Shopping Mall

1,798,346

4,700,000

2,901,654

Hotel Barceló

7,090,735

23,700,000

16,609,265

Hotel Atlántico

18,667,707

29,200,000

10,532,293

Hotel Playa Canela

14,984,936

15,900,000

915,064

Hotel Iberostar

18,358,560

23,700,000

5,341,440

Hotel Isla Canela Golf

4,147,317

4,700,000

552,683

Total

65,422,255

103,840,000

38,417,745

N.T.V.: Net tax value

M.V.T.: Market value of transfer

R.D. Deferred income

c) No tax benefits are enjoyed by the transferor entity concerning which the absorbed entity must

comply with specific requirements pursuant to the provisions of Article 84.1 of the Corporation Tax

Act (“LIS”).

In 2013 the absorbed company, Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U., in turn absorbed

the company, Compañía Ibérica de Rentas Urbanas 2009, SOCIMI, S.A.U., so that it acquired all its assets

and liabilities. The properties acquired by Compañía Ibérica de Rentas Urbanas 2009, SOCIMI, S.A.U. were

the result of a restructuring deal in which the transferor Cogein, S.L. (now S.L.U.) ) exercised the power

currently referred to in Article 77.2 of the Corporation Tax Act.

C. Bensell Mirasierra, S.L.U.

Due to the subsequent acquisition and merger of this investee with the Company, a new deferred income of

5,506,170 euros arose as a result of the difference between the net tax value and the acquisition and merger

value.

Data at 31 December 2022

Property

Euros

N.T.V.:

M.V.T.:

R.D.

Valle de la Fuenfría, 3

12,117,499

17,623,669

5,506,170

Total

12,117,499

17,623,669

5,506,170

N.T.V.: Net tax value

M.V.T.: Market value of transfer

R.D. Deferred income

18.3 Years open for review and tax audits

In accordance with prevailing legislation in Spain, taxes cannot be considered to have been definitively

settled until the returns filed have been inspected by the tax authorities or until the four-year statute of

limitations period has elapsed. At year-end 2022, the Company's taxes corresponding to the last four years

remained open to inspection. The Directors of the Company consider that the settlements of the above-

mentioned taxes have been properly filed. Hence, although discrepancies may arise regarding the tax

treatment given to the operations due to the interpretation of prevailing regulations, any liabilities that may

eventually result from them, should they come about, will not significantly affect the annual accounts attached

hereto.

18.4 Reporting requirements as a REIT

This information is set out in Annex 1 attached (Law 11/2009 amended by Law 16/2012).

19. Income and expenses

19.1 Net turnover, other operating income and subsidies

The breakdown of these items at 31 December 2022 and 2021 is as follows:

Euros

2022

2021

Hotels

9,747,961

6,389,336

Offices

11,331,546

9,266,406

Retail

9,564,815

7,443,982

Industrial

982,093

Rental subtotal

30,644,323

24,081,817

Provision of sundry services

63,007

38,396

Capital grants taken to profit and loss

56,351

Total income

30,763,680

24,176,564

The Company's entire turnover in 2022 and 2021 was generated in Spain.

19.2 Staff costs

The balance of this item in 2022 and 2021 was comprised as follows:

Euros

2022

2021

Wages and salaries:

Wages, salaries and similar outgoings

358,311

340,467

National Insurance contributions:

Social Security contributions incurred by the company

74,088

68,559

Other social expenses

53,704

54,524

Total

486,103

463,550

19.3 External charges for services, taxes and similar levies

The breakdown of this item for 2022 and 2021 is as follows:

Euros

2022

2021

Leases

27,921

18,306

Repairs and maintenance

851,544

525,084

Independent professional services

365,912

858,745

Insurance policies

78,669

76,693

Banking services and similar

9,012

14,128

Advertising and public relations

21,951

3,975

Supplies

1,245,470

632,759

Other services

410,322

251,867

Other levies

2,289,343

2,014,701

Total

5,300,144

4,396,258

20. Related-party transactions and balances

20.1 Related-party transactions

The transactions made with related companies in 2022 and 2021 were as follows:

Euros

31/12/2022

31/12/2021

Financial

Income

Financial

Income

income

Isla Canela, S.A.

126,218

108,891

91,501

103,318

540

Promociones y Construcciones PYC Pryconsa, S.A.

670,098

25,253

26,519

215,644

24,208

38,663

Planificación Residencial y Gestión, S.A.U.

5,317

689

-21

434

Cogein, S.L.U.

751

132,886

753

Propiedades Cacereñas, S.L.U.

294

295

Triangulo Plaza Cataluña, S.L.

260

259

Jardins Sottomayor - Imobiliária e Turismo, SA

3,267

3,209

Codes Capital Partners, S.L.U.

319

Cotos Capital S.L.

322

Pryconsa Senyor, S.L.

5,813

3,121

Promoción, Gestión y Marketing Inmobiliario, S.L.

1,208

751

Per 32, S.L.

183

200

Total

801,633

146,931

159,405

307,124

136,867

39,203

At 31 December 2022, the relationship between the companies with which the Company has relevant

“Related party transactions and balances” is as follows:

- Isla Canela, S.A.: Company 93.90% owned by PER 32, S.L.

- Promociones y Construcciones PYC Pryconsa, S.A.: Direct shareholder of the Company with an

11.19% stake.

20.2 Balances with related companies

Balances with related companies at 31 December 2022 and 2021 are as follows:

2022

Euros

Loans granted to related

companies (Note 9)

Loans received from

related companies

Cogein, S.L.U.

3,461,920

Total

3,461,920

2021

Euros

Loans granted to related

companies (Note 9)

Loans received from

related companies

Promociones y Construcciones PYC, Pryconsa, S.A. (Note 8)

38,400

Total

38,400

The main agreements currently in force which the Company has with related companies are as follows:

- On 30 April 2018, the Company signed a lease agreement for parking spaces with Promociones y

Construcciones, PYC, Pryconsa, S.A., under which the latter leases 17 parking spaces to the

Company located in the building at Glorieta de Cuatro Caminos, 6 and 7, Madrid. The contract term

is for five years, starting on 1 May 2018, extendable for five-year periods unless expressly agreed

by the parties.

- On 28 April 2017, the Company entered into a technical service provision agreement with

Promociones y Construcciones PYC Pryconsa, S.A., consisting of (i) technical assistance with the

properties constructed by the latter and (ii) integrated project management of remodelling,

refurbishment or adaptation works to properties owned by the Company, in exchange for

remuneration of 5% calculated using the value of the works performed under the aforementioned

contract. The duration of this contract was established for an annual period, tacitly renewable for

annual periods, unless the parties expressly indicate otherwise.

- On 11 June 2014, the Company entered into a service provision agreement with Promociones y

Construcciones, PYC, Pryconsa, S.A., whereby the latter would provide the Company with an

integrated management assistance service for legal, administrative and tax services, in addition to

granting the use of space. The contact's term runs for one year and can be extended unless

contested by the parties.

- On 1 September 2022, the various companies in the PER 32 group signed a framework agreement

on mutual financing, under which any company with surplus liquidity can finance the other

companies requiring such financing at market conditions, provided their financing needs are met.

The agreement has a term of three years, which can be automatically extended for another three

years unless one of the companies waives it.

As a result of the mergers set out in Note 1, all obligations and rights deriving from the following agreements

between Promociones y Construcciones PYC Pryconsa, S.A. and Isla Canela, S.A were transferred to the

Company:

- On 1 June 2012, Isla Canela S.A. and Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U.

entered into a technical services provision agreement for the maintenance of the hotels owned by

Compañía Ibérica de Bienes Raíces 2009, SOCIMI, S.A.U. Pursuant to the aforementioned

agreement, Isla Canela, S.A. provides the Company with an integrated preventive maintenance

service for the hotels owned by the Company in Isla Canela. The agreement is annual but may be

tacitly extended by the parties on an annual basis, although either of the parties may terminate it at

any time.

Additionally, the aforementioned technical services contract establishes that Isla Canela, S.A.

provides the Company with the full project management service for remodelling, renovating or

adaptation works which may be necessary on the hotels owned by the Company in Isla Canela.

- On 31 December 2012, Isla Canela S.A. and Compañía Ibérica de Bienes Raíces 2009, SOCIMI,

S.A.U. signed a hotel property lease agreement (for Hotel Isla Canela Golf). The contract is renewed

on a three-year basis with the current maturity date of 31 December 2023.

- On 1 November 2022, a sublease agreement was signed with the company Planificación

Residencial y Gestión, S.A.U. for part of the second floor of the office building at Glorieta de Cuatro

Caminos 6 and 7. The term of the sublease is the same as that of the lease signed by Planificación

Residencial y Gestión, S.A.U. as lessee.

21. Remuneration for the Board of Directors and Senior Management

The total remuneration due in 2022 and 2021 for all items of the members of the Board of Directors and the

senior management of Saint Croix Holding Immobilier, SOCIMI, S.A. and people performing similar duties at

the end of each year can be summarised as follows:

Euros

2022

2021

Fixed remuneration

40,000

Variable remuneration

1,000

Allowances

10,000

Total

51,000

The functions of Senior Management are exercised by the members of the Board of Directors.

Furthermore, at 31 December 2022 and 2021, there were no advances or credits or any other kind of pension

or life insurance guarantees or obligations in connection with current and former members of the Board of

Directors.

During 2022 and 2021, the Company has not paid any amounts on the grounds of civil liability insurance

associated with the Directors.

Likewise, there have been no agreements between the Company and any of the Directors or persons acting

on their behalf, linked to operations other than in the normal course of business or that have not been

undertaken in normal conditions.

The number of Directors distributed by gender was as follows in 2022 and 2021:

2022

2021

Male

Female

Total

Male

Female

Total

Additionally, the Board of Directors has a non-Director Secretary of the Board who is male.

22. Information on conflicts of interest among the Directors

At year-end 2022, neither the members of the Board of Directors of Saint Croix Holding Immobilier, SOCIMI,

S.A. or the parties related to them, as laid down pursuant to the Corporate Enterprises Act, had reported to

the other members the Board of Directors any direct or indirect conflict of interests with those of the

Company.

23. Other information

23.1 Personnel

The average number of people employed in 2022 and 2021 broken down by job category is as follows:

2022

2021

Management

Technical staff

Administrative staff

Total

Likewise, the distribution by gender at the end of 2022 and 2021 broken down by category was as follows:

2022

2021

Male

Female

Male

Female

Directors

Management

Technical staff

Administrative staff

Total

No individuals with a level of disability equal to or greater than 33% were employed at year-end 2022 and

2021.

23.2 Audit fees

The fees for account auditing services and other services provided by the Company's auditor, BDO

Auditores, S.L.P., or by a company related to the auditor or jointly owned or controlled by it were as follows

in 2022 and 2021:

Euros

Services provided by the auditor of

accounts and related companies

2022

2021

Audit services

29,380

28,250

Other verification services

Total audit and related services

29,380

28,250

Tax advisory services

Other services

Total professional services

29,380

28,250

24. Environmental information

Environmental activities consist of any activities aimed at preventing, reducing or repairing damages

produced to the environment.

The corporate purpose of the Company, as provided for in its Articles of Association, is stated in Note 1.

In view of the Company’s activities, it does not have direct environmental responsibilities, expenses, assets

or provisions nor contingencies which could have a significant impact in relation to the capital, financial

situation and the results thereof. As a result, no specific breakdowns of information on environmental matters

have been included in these notes to the financial statements.

At 31 December 2022 and 2021, the Company had not booked any provision for possible environmental

risks, given that the Directors do not believe that there are any significant contingencies related to possible

litigation, compensation or other concepts.

25. Segmented reporting

2022

Euros

Hotels

Offices

Retail

Others

Total

Income

9,785,315

11,352,483

9,569,532

30,707,329

Indirect costs

-1,105,863

-2,505,625

-1,541,024

-5,152,512

Net Margin

8,679,451

8,846,859

8,028,508

25,554,818

General expenses

-201,949

-234,292

-197,495

-633,736

EBITDA

8,477,503

8,612,567

7,831,012

24,921,082

% of income

86.63%

75.87%

81.83%

81.16%

Depreciation

-2,327,936

-2,519,145

-1,135,839

-3,203

-5,986,123

Subsidies

56,351

Extraordinary profits (losses)

-20,765

Profit/(loss) on disposal of real estate assets

350,824

Impairment/Reversal of real estate assets

-478,824

Financial profit (loss)

-779,421

-155,478

-3,652,788

-4,587,688

EBT

6,185,153

5,186,000

6,539,695

-3,655,991

14,254,857

Corporation tax

Net profit (loss)

6,185,153

5,186,000

6,539,695

-3,655,991

14,254,857

% of income

63.21%

45.68%

68.34%

0.00%

46.42%

2021

Euros

Hotels

Offices

Retail

Industrial

Others

Total

Income

6,406,676

9,287,463

7,443,982

982,092

24,120,213

Indirect costs

-978,469

-2,156,471

-498,108

-52,939

-3,685,987

Net Margin

5,428,206

7,130,992

6,945,874

929,153

20,434,226

General expenses

-162,774

-235,966

-189,129

-24,952

-612,822

EBITDA

5,265,432

6,895,026

6,756,745

904,201

19,821,404

% of income

82.19%

74.24%

90.77%

92.07%

82.18%

Depreciation

-2,269,685

-2,246,719

-1,040,657

-132,021

-1,527

-5,690,608

Subsidies

56,351

Extraordinary profits (losses)

24,854

Profit/(loss) on disposal of real estate assets

8,961,619

Impairment/Reversal of trade operations

6,456

Impairment/Reversal of real estate assets

-73,669

-311,929

-385,598

Financial profit (loss)

-722,904

-416,146

53,318

116,026

-969,706

EBT

3,076,952

12,813,352

4,994,470

825,498

114,499

21,824,771

Corporation tax

Net profit (loss)

3,076,952

12,813,352

4,994,470

825,498

114,499

21,824,771

% of income

48.03%

137.96%

67.09%

84.06%

90.48%

The breakdown of the income and net book value of real estate assets, including property, plant and

equipment in progress, at 31 December 2022 and 31 December 2021 is as follows:

Euros

31/12/2022

31/12/2021

Income

Net cost

Income

Net cost

Hotels

9,785,315

31.87%

102,661,073

6,406,676

26.56%

104,555,281

Offices

11,352,483

36.97%

209,919,449

9,287,463

38.50%

171,032,481

Retail

9,569,532

31.16%

96,818,388

7,443,982

30.86%

98,012,024

Industrial

982,092

4.07%

Institutional

14,214,881

Plots

23,357,622

Total income

30,707,329

100%

423,613,790

24,120,213

100.00%

396,957,408

The breakdown of contribution to income from a geographic standpoint is as follows:

Euros

31/12/2022

31/12/2021

Income

Madrid

22,306,777

72.64%

18,467,232

76.56%

Huelva

8,400,553

27.36%

5,652,981

23.44%

Castellón

Total

30,707,329

100.00%

24,120,213

100.00%

Furthermore, it is of interest to highlight the evolution of the occupation rates by type of asset from the

standpoint of asset types: The occupation rate of the Company's assets allocated to leases at 31 December

2022 amounted to 92% of the floor space (sq.m.) leased (92% in 2021), which breaks down as follows:

31/12/2022

31/12/2021

Occupation

Hotels

99,408

100.00%

80,135

100.00%

Offices

62,406

95.41%

45,861

89.52%

Retail

40,852

61.73%

40,736

80.40%

Institutional

19,273

100.00%

Total

221,938

91.66%

166,732

92.33%

With respect to Plot TER.02-178-A (Valdebebas) for hotel and institutional use, in 2022, following the signing

of two leases for future use and the commencement of construction, the Company included the square

metres of this property in the gross leasable area for hotel and institutional use, which was divided into two

resulting properties in 2022, each with a total area of 19,273 m2.

During 2022, the occupancy rate of properties was maintained compared to the rate recorded at 31

December 2021.

26. International Financial Reporting Standards

Pursuant to Article 525 of the Corporate Enterprises Act, companies that have issued securities which are

traded on a regulated market in any Member State of the European Union, in terms of Article 1.13 of Directive

93/22/EEC of the Council, of 10 May 1993, concerning investment services in the scope of traded securities

and which, pursuant to the regulations in force, only publish separate financial statements, shall be obliged

to state the main variations in shareholders' equity in the notes to the financial statements and in the profit

and loss account, when applying the International Financial Reporting Standards adopted by the European

Union (hereinafter, “the IFRS-EU”).

Having applied the General Accounting Plan approved under Royal Decree 1514/2007, of 16 November,

amended by Royal Decree 1159/2010, amended in 2016 by Royal Decree 602/2016 and amended by Royal

Decree 1/2021 of 12 January, to the Company's operations, there are no significant differences between

said rule and the IFRS-EU, with the exception of the inclusion of capital grants, net of their corresponding tax

effect, in the Company's net equity.

At the end of 2022 and 2021, the Company does not have any lease agreements in force under which it acts

as a lessee (operating lease) and therefore IFRS 16 does not apply to the recognition of a right to use the

asset and a liability for the lease.

Furthermore, the amendments to IFRS 16 “Leases: COVID-19 Related Rent Concessions beyond 30 June

2021”, which applies on a mandatory basis from 1 April 2021 onwards, does not have any impact on the

Company’s equity and profit.

27. Subsequent disclosures

From 31 December 2022 until the date of preparation of the Company's financial statements for 2022, no

relevant events have occurred that need to be specified in this section with the exception of the following:

- On 13 January, the Company signed a line of financing for working capital with personal guarantee

in the amount of 7,500,000 euros with Banca March, freely available and maturing on 13 January

2024.

- On 6 February 2023, the Company made the second and final drawdown of 12,000,000 euros of

the loan arranged with Bankinter in 2022 to finance the refurbishment and start-up of the tertiary

building owned by the Company and located at calle Arapiles 14 in Madrid. The work was

completed at the end of December 2022, as the conditions precedent required for this drawdown

had been fulfilled by that date, which has now occurred.

- On 23 February 2023, the Company entered into a mortgage loan with Banco Santander for

36,000,000 euros to finance the construction of a private hospital on plot TER.02-178-A1 located at

Calle Gustavo Pérez Puig No. 66 in Madrid, which is owned by the Company. This hospital will be

operated by Sanitas S.A. de Hospitales on the basis of the lease agreement signed between the

parties in 2022. This loan has a drawdown and grace period of 3 years and an additional 10-year

amortisation period with increasing instalments.

- On February 28, 2023, the Company has formalized a loan with a personal guarantee with Banco

Santander of 10,000,000 euros in order to finance its working capital. This loan has a maturity of 12

months.

Annex 1. Reporting requirements as a REIT

Description

2022

a) Reserves from years prior to the application of the tax

scheme set forth in Law 11/2009, as amended by Law

16/2012 of 27 December.

As is set out in Note 1, the Company was incorporated on 1 December 2011

in Luxembourg without having allocated any prior year's profits to reserves.

b) Reserves of each financial year in which the special tax

regime set forth in said Law applies.

Profits allocated to reserves by the Company

- Profits in 2014 allocated to reserves: 921,102 euros

- Profits in 2015 allocated to reserves: 2,776,186 euros

- Profits in 2016 allocated to reserves: 1,724,518 euros

- Profits in 2017 allocated to reserves: 1,320,042 euros

- Profits in 2018 allocated to reserves: 1,455,425 euros

- Profits in 2019 allocated to reserves: 1,730,153 euros

- Profits in 2020 allocated to reserves: 944,411 euros

- Profits in 2021 allocated to reserves: 6,676,648 euros

Profits applied to reserves by the absorbed company COMPAÑÍA

IBÉRICA DE BIENES RAÍCES 2009, SOCIMI, S.A.U.

- Profits in 2009 allocated to reserves: 936,358 euros

- Profits in 2010 allocated to reserves: 871,431 euros

- Profits in 2011 allocated to reserves: 1,000,888 euros

- Profits in 2012 allocated to reserves: 43,627 euros

- Profits in 2013 allocated to reserves: 470,286 euros

- Profits in 2014 allocated to reserves: 1,208,270 euros

- Profits in 2015 allocated to reserves: 3,699,608 euros

Profits applied to reserves by the absorbed company INVERETIRO,

SOCIMI, S.A.U.

- Profits in 2015 allocated to reserves: 477,756 euros

- Profits from income subject to the general tax levy.

- Tax gain of 2019 for the sale of Rutilo 21, 23 and 25: 572,893 euros

- Profits from income subject to tax at a levy of 19%.

Profits applied to reserves by the absorbed company COMPAÑÍA

IBÉRICA DE BIENES RAÍCES 2009, SOCIMI, S.A.U.

- Profits in 2009 allocated to reserves: 936,358 euros

- Profits in 2010 allocated to reserves: 871,431 euros

- Profits in 2011 allocated to reserves: 1,000,888 euros

- Profits in 2012 allocated to reserves: 43,627 euros

- Profits from income subject to tax at a levy of 0%.

Profits allocated to reserves by the Company

- Profits in 2014 allocated to reserves: 921,102 euros

- Profits in 2015 allocated to reserves: 2,776,186 euros

- Profits in 2016 allocated to reserves: 1,724,518 euros

- Profits in 2017 allocated to reserves: 1,320,042 euros

- Profits in 2018 allocated to reserves: 1,455,425 euros

- Profits in 2019 allocated to reserves: 1,730,153 euros

- Profits in 2020 allocated to reserves: 944,411 euros

- Profits in 2021 allocated to reserves: 6,676,648 euros

Profits applied to reserves by the absorbed company COMPAÑÍA

IBÉRICA DE BIENES RAÍCES 2009, SOCIMI, S.A.U.

- Profits in 2013 allocated to reserves: 470,286 euros

- Profits in 2014 allocated to reserves: 1,208,270 euros

- Profits in 2015 allocated to reserves: 3,699,608 euros

Profits applied to reserves by the absorbed company INVERETIRO,

SOCIMI, S.A.U.

- Profits in 2015 allocated to reserves: 477,756 euros

c) Dividends paid out and charged to profits of each

financial year in which the tax scheme set forth in this

Law can be applied.

Dividends distributed by the Company

- Distribution of dividends in 2015: 6,979,719 euros

- Distribution of dividends in 2016: 13,958,138 euros

- Distribution of dividends in 2017: 11,880,376 euros

- Distribution of dividends in 2018: 13,098,821 euros

- Distribution of dividends in 2019: 12,526,626 euros

- Distribution of dividends in 2020: 8,499,697 euros

- Distribution of dividends in 2021: 15,148,124 euros

Dividends distributed by the absorbed company COMPAÑÍA IBÉRICA DE

BIENES RAÍCES 2009, SOCIMI, S.A.U.

- Distribution of dividends in 2009: 3,382,919 euros

- Distribution of dividends in 2010: 3,121,886 euros

- Distribution of dividends in 2011: 3,585,669 euros

- Distribution of dividends in 2012: 156,295 euros

- Distribution of dividends in 2013: 1,209,306 euros

- Distribution of dividends in 2014: 10,874,427 euros

- Distribution of dividends in 2015: 14,799,010 euros

Dividends distributed by the absorbed company INVERETIRO, SOCIMI,

S.A.U.

- Distribution of dividends in 2015: 1,987,206 euros

- Dividends from income subject to the general tax

levy.

- Dividends from income subject to taxation at 18%

(2009) and 19% (2010 to 2012).

Dividends distributed by the absorbed company Compañía Ibérica de

Bienes Raíces 2009, SOCIMI, S.A.U.

- Distribution of dividends in 2009: 3,382,919 euros

- Distribution of dividends in 2010: 3,121,886 euros

- Distribution of dividends in 2011: 3,585,669 euros

- Distribution of dividends in 2012: 156,295 euros

- Dividends from income subject to tax at a levy of 0%.

Dividends distributed by the Company

- Distribution of dividends in 2015: 6,979,719 euros

- Distribution of dividends in 2016: 13,958,138 euros

- Distribution of dividends in 2017: 11,880,376 euros

- Distribution of dividends in 2018: 13,098,821 euros

- Distribution of dividends in 2019: 12,526,626 euros

- Distribution of dividends in 2020: 8,499,697 euros

- Distribution of dividends in 2021: 15,148,124 euros

Dividends distributed by the absorbed company COMPAÑÍA IBÉRICA DE

BIENES RAÍCES 2009, SOCIMI, S.A.U.

- Distribution of dividends in 2013: 1,209,306 euros

- Distribution of dividends in 2014: 10,874,427 euros

- Distribution of dividends in 2015: 14,799,010 euros

Dividends distributed by the absorbed company INVERETIRO, SOCIMI,

S.A.U.

- Distribution of dividends in 2015: 1,987,206 euros

d) Dividends paid out and charged to reserves

- Dividends charged to reserves subject to taxation at

the general tax levy.

- Dividends charged to reserves subject to taxation at

19%.

- Dividends charged to reserves subject to taxation at

0%.

e) Date of the dividend pay-out resolution referred to by

items c) and d) above.

Dividends distributed by the Company

- 2015 dividends: 01/04/2016

- 2016 dividends: 29/06/2017

- 2017 dividends: 26/04/2018

- 2018 dividends: 25/04/2019

- 2019 dividends: 30/06/2020

- 2020 dividends: 29/04/2021

- 2021 dividends: 27/04/2022

Dividends distributed by the absorbed company COMPAÑÍA IBÉRICA DE

BIENES RAÍCES 2009, SOCIMI, S.A.U.

- 2009 dividends: 29/06/2010

- 2010 dividends: 30/06/2011

- 2011 dividends: 28/06/2012

- 2012 dividends: 20/06/2013

- 2013 dividends: 30/06/2014

- 2014 dividends: 22/06/2015

- 2015 dividends: 01/04/2016

Dividends distributed by the absorbed company INVERETIRO, SOCIMI,

S.A.U.

- 2015 dividends: 01/04/2016

f) Acquisition date of the properties allocated to lease

which generate income subject to this special scheme

and that remain on the company's balance sheet on

the reporting date.

Properties from the absorbed company COMPAÑÍA IBÉRICA DE BIENES

RAÍCES 2009, SOCIMI, S.A.U.

The properties were owned by the absorbed company on 29/12/2009. Due to

the partial division transaction of Isla Canela, S.A., the dates of ownership are

as follows:

- Hotel Isla Canela Golf: 28/12/2007

- Hotel Barceló Isla Canela: 06/07/1998

- Hotel Iberostar Isla Canela: 01/07/2002

- Hotel Playa Canela: 16/05/2002

- Hotel Meliá Atlántico: 25/05/2000

- Marina Isla Canela Shopping Mall: 17/10/2000

- Property at Calle Gran Vía 1: 19/10/1987

The following real estate investments, which were acquired from the related

company Promociones y Construcciones, PYC, Pryconsa, S.A. were included

in 2012:

- Offices Sanchinarro VI: 29/11/2012

- Offices Sanchinarro VII: 29/11/2012

- Vallecas Comercial I: 30/10/2012

- Vallecas Comercial II: 30/10/2012

- Offices Coslada III: 29/11/2012

Properties from the absorbed company COMPAÑÍA IBÉRICA DE RENTAS

URBANAS 2009 SOCIMI, S.A.U.,

The properties were owned by the absorbed company on 22 December 2009.

Due to the partial spin-off of the related company, Cogein, S.L.U., the

ownership dates are as follows

- Hotel Innside Meliá Gran Vía: 16/05/2002

- Retail outlet at Gran Vía 34: 16/05/2002

- Retail outlet on Dulcinea: 21/09/1995

- Pradillo 41 offices: 27/02/2009

- Retail outlet at Albalá 7: 26/09/2003

- Gran Vía 1-1º and 2º Dcha offices: 15/10/1993

- Gran Vía 1-1º Izda offices: 10/02/1998

- Building on Plaza España, Castellón: 29/12/2011

Properties from the absorbed company INVERETIRO, SOCIMI, S.A.U.

- Titán 13 office: 12/02/2014

- Business premises at Conde de Peñalver 16: 01/12/2013

Properties from the absorbed company BENSELL MIRASIERRA, S.L.U.

Valle de la Fuenfría, 3: 09/03/2015

Direct acquisitions made by the Company and that remain under its control:

- Retail outlet at Gran Vía 55: 01/03/2016

- Edificio José Abascal 41: 02/12/2016

- Building at Orense, 62: 07/02/2017

- Business Premises at Goya, 59: 10/02/2017

- Business Premises at Glorieta de Cuatro Caminos, 6 and 7: 11/04/2018

- Juan Ignacio Luca de Tena 17 building: 31/01/2019

- Plot TER.02-178-A (Valdebebas): 09/09/2020

- Building at Arapiles, 14: 08/10/2021

- Sexta Avenida shopping centre: 30/11/2021

- Offices Santiago de Compostela 100 bis: 27/07/2022

- Offices Avenida de Cantabria 51: 27/07/2022

g) Acquisition date of interests in the capital of the

entities referred to in paragraph 1, Article 2 of this

Law.

2019: Unibail Rodamco. 6,950 shares (Current value 0.34 million euros)

2020: Inmobiliaria Colonial: 1,572,296 shares

2021: Inmobiliaria Colonial: 1,113,250 shares

(Total current value of Inmobiliaria Colonial 16.14 million euros)

h) Identification of the assets calculated within the eighty

per cent referred to by paragraph 1, Article 3 of this

Law.

The breakdown of real estate assets and their gross booked cost expressed

as millions of euros, is as follows:

Meliá Atlántico

36.40

Barceló Isla Canela

28.35

Iberostar Isla Canela

25.79

Meliá Innside Gran Vía

24.85

Playa Canela

17.51

Isla Canela Golf

5.28

Hotel Valdebebas (under construction)

14.89

Hotels

153.07

Pradillo 42

22.38

Sanchinarro VI

5.87

Sanchinarro VII

0.86

Titán 13

31.91

Valle de la Fuenfría, 3

18.23

José Abascal 41

25.61

Juan Ignacio Luca de Tena,17

30.80

Avda. Cantabria, 51

16.75

Santiago Compostela, 100 bis

22.33

Orense 62

4.40

Arapiles 14

36.27

Coslada III

0.21

Vallecas Comercial I

1.89

Gran Vía 1 (2º derecha)

2.87

Gran Vía 1 (1º derecha)

3.01

Gran Vía 1 (2º izquierda)

1.94

Offices

225.32

Gran Vía 34

21.53

Plaza España

15.10

Conde Peñalver 16

20.43

Gran Vía 55

13.46

Cuatro Caminos

7.12

Goya 59

15.81

Sexta Avenida shopping centre

10.95

Vallecas Comercial II

3.91

Marina Isla Canela Shopping Mall

4.72

Albalá 7

2.87

Gran Vía 1 (1º izquierda)

2.73

Dulcinea 4

1.53

Retail

120.14

Valdebebas Hospital (under construction)

14.21

Institutional

14.21

Total real estate assets:

512.75

Unibail Rodamco

0.34

Inmobiliaria Colonial:

16.14

Total:

529.23

i) Reserves from years in which the special tax regime

set forth in this Act has applied and which have been

drawn down during the tax period, but not for

distribution or to offset losses. The financial year from

which said reserves come should be indicated.

2019 profit allocated to voluntary reserves: 304,475 euros

Management Report

2022

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Management report at year-end 2022

1. Explanation of figures at 31 December 2022

A breakdown of the main figures at 31 December 2022 compared to 31 December 2021 is provided below:

Euros

31/12/2022

31/12/2021

+ / -

Income

30,707,329

24,120,213

27%

Leases

30,644,323

24,081,817

Provision of sundry services

63,007

38,396

Operating expenses

-5,152,512

-3,685,987

40%

Net operating income (NOI)

25,554,818

20,434,226

25%

General expenses

-633,736

-612,822

EBITDA

24,921,082

19,821,404

26%

Financial profit (loss)

-4,587,688

-969,706

373%

EBTDA

20,333,394

18,851,698

Depreciation

-5,986,123

-5,690,608

Subsidies

56,351

Impairment/Reversal of trade operations

6,456

Impairment/Reversal of real estate assets

-478,824

-385,598

Other gains (losses)

-20,765

24,853

Gains (losses) Disposal of real estate assets

350,824

8,961,619

EBT

14,254,857

21,824,771

-35%

Corporation tax

Net profit (loss)

14,254,857

21,824,771

-35%

Sector indicators at 31 December 2022 and 31 December 2021

Euros

31/12/2022

Per share

31/12/2021

Per share

Recurring net profit

17,341,974

3.90

12,950,956

2.91

Net value of assets

553,905,533

124.41

535,119,847

120.19

Costs

5,786,247

4,859,809

Income

30,707,329

24,120,213

Cost/income ratio

18.84%

20.15%

Vacancy ratio

7.11%

4.52%

Net profitability

4.42%

4.52%

Main figures at 31 December 2022 and 31 December 2021

Financial year

31/12/2022

31/12/2021

Annualized income (millions)

29.27

25.77

FFO (mn)

24.84

19.25

FFO (/share)

5.58

4.32

GAV (mn)

680.36

619.67

NAV (mn)

553.59

535.12

ROA

3.06%

5.22%

ROE

4.57%

6.89%

Gross leasable surface area (risk-free m

) (*)

221,938

166,732

% occupancy at year end

91.66%

92.57%

Lease portfolio (mn)

221.19

229.46

WAULT

9.10

9.39

LTV

19.99%

15.41%

Net debt (mn)

138.32

97.51

Profit (euro/share)

3.20

4.90

Dividend (euro/share)

2.84

3.40

Gross profitability via dividend

4.32%

4.68%

APM definitions:

- GAV: Gross market value of real estate assets; NAV: Gross market value of real estate assets - net financial debt +/- other assets and

liabilities including loans to group companies and associates

- NOI: Gross operating income - Operating expenses.

- EBITDA: NOI - Other general costs.

- EBITDA: EBITDA - financial income.

- Recurring net profit: The Company's profit/(loss), eliminating the result derived from the sale of real estate assets, impairments and

reversals, changes in the fair value of equity instruments and the impact of corporation tax.

- Annualised income: Forecast of the income to be generated by the real estate assets owned at 12 months from the date of

information based on the contractual conditions at that date.

Funds from operations (FFO): Direct cash flow from the Company's operations, i.e. rental income less operating expenses and

exceptional expenses involving cash flow or cash movements.

Real estate investments (gross): At 31 December 2022, the Company's gross property investments came

to 512,747,941 euros. In 2022, the following investments and disinvestments took place: