SAINT CROIX HOLDING IMMOBILIER,

SOCIMI, S.A.

Financial Statements and Directors' Report for the

financial year 2023 together with the Audit Report

of Financial Statements emitted by an Independent

Auditor

This version of the financial statements is a free translation of the

original, which was prepared in Spanish. All possible care has been

taken to ensure that the translation is an accurate representation of

the original. However, in all matters of interpretation of

information, views or opinions, the original language version of the

financial statements takes precedence over this translation.

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Financial Statements and Directors' Report for the financial year 2023

together with the Audit Report of Financial Statements emitted by an

Independent Auditor

AUDIT REPORT ON THE FINANCIAL STATEMENTS ISSUED BY AN INDEPENDENT AUDITOR

FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR 2023:

- Balance Sheets at 31 December 2023 and 2022

- Profit and Loss Account for the financial years 2023 and 2022

- Statement of Changes in Equity for the financial years 2023 and 2022

- Cash Flow Statements for the financial years 2023 and 2022

- Annual report for the financial year 2023

DIRECTORS’ REPORT FOR THE FINANCIAL YEAR 2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Audit Report of Financial Statements emitted by an Independent

Auditor

Tel: +34 91 436 41 90

Fax: +34 91 436 41 91/92

www.bdo.es

Génova 27

28004 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 2023, 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 2023, 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.

BDO Auditores S.L.P. es una sociedad limitada española independiente, miembro de BDO lnternational Limited, una compañía limitada por garantía del

Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas. BDO es la marca comercial utilizada por toda la red BDO y

para todas sus firmas miembro.

Key Audit matters

Audit response

Valuation of property investments at

financial year-end

The heading "Property Investments" in

the attached balance sheet includes

the net values at 31 December 2023

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

elements of judgment presenting

varying degrees of subjectivity.

The analysis of the reasonableness of

the recoverable value of these assets

as at 31 December 2023 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 prepared

by the independent expert as of the

fiscal year-end date. Based on this

report, an analysis of the reasonableness

of the calculations performed by the

Company's management for determining

the recoverable amounts of the property

investments as of December 31, 2023.

- 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.

- 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.

Other information: Management report

The other information comprises exclusively the management report for financial year

2023, the formulation of which is the responsibility of the Company’s management and

does not form an integral part of the financial statements.

BDO Auditores S.L.P. es una sociedad limitada española independiente, miembro de BDO lnternational Limited, una compañía limitada por garantía del

Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas. BDO es la marca comercial utilizada por toda la red BDO y

para todas sus firmas miembro.

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

responsibility regarding the management report, defined in the regulation governing

financial statement audit work, consists of:

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.

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 2023 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.

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.

BDO Auditores S.L.P. es una sociedad limitada española independiente, miembro de BDO lnternational Limited, una compañía limitada por garantía del

Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas. BDO es la marca comercial utilizada por toda la red BDO y

para todas sus firmas miembro.

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.

BDO Auditores S.L.P. es una sociedad limitada española independiente, miembro de BDO lnternational Limited, una compañía limitada por garantía del

Reino Unido y forma parte de la red internacional BDO de empresas independientes asociadas. BDO es la marca comercial utilizada por toda la red BDO y

para todas sus firmas miembro.

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 6 March 2024.

Contract period

The Ordinary General Shareholders’ Meeting held on 27 April 2023 appointed us as auditors

for one-year period corresponding to the fiscal year ended December 31, 2023.

Prior to this, the Ordinary General Shareholders ‘Meeting held on June 30, 2020, appointed

us as auditors of the Company for a period of three years, and we have been continuously

performing the audit work since the fiscal year ended December 31, 2020."

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

Francisco J. Giménez Soler (ROAC 21.667)

Partner

6 March 2024

SAINT CROIX HOLDING IMMOBILIER,

SOCIMI, S.A.

Financial Statements

for the year ended on

31 December 2023

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 ______________________________________________________ 21 
 Property investment _______________________________________________________________ 22 
 Operating leases __________________________________________________________________ 28 
 Other financial assets and investments in related companies ____________________________ 28 
 Trade and other accounts receivable  ________________________________________________ 30 
 Cash and cash equivalents _________________________________________________________ 31 
 Information on the nature of financial instruments and their level of risk ___________________ 31 
 Total equity and shareholders' equity  ________________________________________________ 32 
 Current and non-current liabilities ___________________________________________________ 36 
 Hedge instruments ________________________________________________________________ 37 
 Disclosure on supplier payment deferrals _____________________________________________ 38 
 Guarantees undertaken with third parties _____________________________________________ 39 
 Public administrations and tax situation _______________________________________________ 39 
 Income and expenses  _____________________________________________________________ 44 
 Related-party transactions and balances ______________________________________________ 45 
 Remuneration for the Board of Directors and Senior Management ________________________ 47 
 Information on conflicts of interest among the Directors _________________________________ 48 
 Other information _________________________________________________________________ 48 
 Environmental information __________________________________________________________ 49 
 Segmented reporting ______________________________________________________________ 49 
 International Financial Reporting Standards ___________________________________________ 50 
 Subsequent disclosures ____________________________________________________________ 51 
 
Annex 1. Reporting requirements as a REIT __________________________________________________ 52 
 
Management Report  _____________________________________________________________________ 56 
 
 Explanation of figures at 31 December 2023 __________________________________________ 57 
 Valuation of real estate assets _______________________________________________________ 61 
 Segmented reporting ______________________________________________________________ 62 
 Property Investment _______________________________________________________________ 63 
 Disclosure on supplier payment deferrals _____________________________________________ 64 
 Earnings per share ________________________________________________________________ 65 
 Acquisition of treasury shares _______________________________________________________ 65 
 Research and development activities  ________________________________________________ 65 
 Main risks to the Company _________________________________________________________ 65 
 Outlook for 2024 __________________________________________________________________ 66 
 Information on conflicts of interest among the Directors _________________________________ 67 
 Subsequent disclosures ____________________________________________________________ 67 
 Annual Corporate Governance Report and Annual Report on Directors' Remuneration ______ 68 
 
Directors' Responsibility Statement _________________________________________________________ 69 
 
Diligence in Drawing Up the Financial Statements ____________________________________________ 70 
 
 
   

Annual Report

2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

BALANCE SHEET AT 31 December 2023

(euros)

Notes

Financial year

Notes

Financial year

ASSETS

2023

2022

EQUITY AND LIABILITIES

2023

2022

NON‐CURRENT ASSETS

497,196,045

441,679,127

EQUITY

319,312,706

312,056,267

OWN FUNDS

Intangible fixed assets

Computer software

Capital

267,577,040

Property, plant and equipment

135,152

149,473

Authorised capital

267,577,040

Plant and other tangible fixed assets

135,152

149,473

Reserves

30,582,423

28,981,526

Property investment

494,268,775

438,508,778

Legal and statutory

11,453,626

10,028,140

Net property investments

494,268,775

438,508,778

Other reserves

19,128,797

18,953,386

Long-term financial investments

2,792,118

3,020,841

Profit (Loss) for the year

20,063,539

14,254,857

Derivatives

9 and 15

217,266

314,055

Adjustments for changes in value

217,266

314,055

Other financial assets

2,574,852

2,706,786

Hedging operations

217,266

314,055

Subsidies, donations and bequests

872,438

928,789

Subsidies, donations and bequests

872,438

928,789

NON-CURRENT LIABILITIES

137,021,593

108,699,071

Long-term provisions

894,396

Non-current payables

136,127,197

108,699,071

Bank borrowings

132,193,018

104,798,848

Other financial liabilities

3,934,179

3,900,223

CURRENT ASSETS

37,332,506

23,305,342

Trade and other accounts receivable

4,380,231

4,205,675

CURRENT LIABILITIES

78,194,252

44,229,131

Accounts receivable for sales and services

3,162,792

4,174,532

Current payables

55,009,850

35,514,865

Staff

864

944

Bank borrowings

54,481,696

35,026,383

Current tax assets

18.1

110,779

20,362

Other financial liabilities

528,154

488,482

Other credits with Public Administrations

18.2

1,105,796

9,837

Current payables with Group and associate companies

20.2

6,270,230

3,461,920

Short-term investments in Group and associate companies

20.2

10,000,000

Trade creditors and other accounts payable

16,914,172

5,252,346

Short‐term financial investments

18,198,820

17,274,446

Suppliers

14,122,506

2,776,442

Short-term equity instruments

17,590,326

16,478,110

Group suppliers

1,403

Other financial assets

608,494

796,336

Sundry creditors

2,173,090

2,072,210

Cash and cash equivalents

4,753,455

1,825,221

Other payables with Public Administrations

18.1

617,173

396,594

Cash and bank

4,753,455

1,825,221

Advance payments from customers

7,100

TOTAL ASSETS

534,528,551

464,984,469

TOTAL EQUITY AND LIABILITIES

534,528,551

464,984,469

Notes 1 to 27 to the attached financial statements attached hereto form an integral part of the balance sheet at 31 December 2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

PROFIT AND LOSS ACCOUNT FOR 2023

(euros)

Notes

Financial year

2023

2022

CONTINUED OPERATIONS

Revenues

19.1

34,949,845

30,644,323

Rental of properties

34,949,845

30,644,323

Other operating income

19.1

28,615

63,007

Non-core and other current management income

28,615

63,007

Staff costs

19.2

-574,286

-486,103

Wages, salaries and similar outgoings

-427,118

-358,311

National insurance contributions

-147,168

-127,792

Other operating expenses

-7,378,005

-5,299,973

Charges for external services

19.3

-3,649,787

-3,010,801

Taxes and similar levies

19.3

-3,718,516

-2,289,343

Losses, impairment and changes in provisions for trade transactions

-9,701

171

Other current management expenses

-1

Fixed asset depreciation

6 and 7

-6,436,901

-5,986,123

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

2,355,101

-128,172

Impairment and losses

-108,609

-478,996

Gains (losses) on disposals and others

2,463,710

350,824

Other gains (losses)

4,585

-20,765

Exceptional income and expenses

4,585

-20,765

OPERATING PROFIT (LOSS)

23,005,305

18,842,545

Financial income

1,312,977

402,994

From transferable securities and other financial instruments

1,312,977

402,994

- In Group and associate companies

20.1

581,670

- In equity instruments

671,387

377,351

‐ In third parties

59,920

25,643

Financial expenses

-5,298,569

-2,073,585

From Group and associate companies

20.1

-123,579

-159,405

From payables with third parties

-5,174,990

-1,914,180

Variation in the fair value of financial instruments

1,446,859

-2,917,097

Gains (losses) on the trading portfolio

1,446,859

-2,917,097

Impairment and gains/losses on disposals of financial instruments

985

Gains (losses) on disposals and others

985

FINANCIAL PROFIT (LOSS)

-2,537,748

-4,587,688

PROFIT (LOSS) BEFORE TAX

20,467,557

14,254,857

Income tax

-404,018

PROFIT (LOSS) FOR THE YEAR

20,063,539

14,254,857

Notes 1 to 27 to the financial statements attached hereto form an integral part of the profit and loss account for 2023.

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

STATEMENT OF CHANGES IN EQUITY FOR 2023

A) STATEMENTS OF RECOGNISED INCOME AND EXPENSE

(euros)

Notes

Financial year

2023

2022

RESULT OF THE PROFIT AND LOSS ACCOUNT (I)

20,063,539

14,254,857

Income and expenses recognised directly in equity

- For cash flow hedges

-96,789

597,063

TOTAL INCOME AND EXPENSE RECOGNISED DIRECTLY IN EQUITY (II)

-96,789

597,063

Transfers to profit and loss account

- Subsidies, donations and bequests

-56,351

- For cash flow hedges

TOTAL TRANSFERS TO PROFIT AND LOSS ACCOUNT (III)

-56,351

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

19,910,399

14,795,569

Notes 1 to 27 to the financial statements attached hereto form an integral part of the statement of recognised income and expense corresponding to 2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

STATEMENT OF CHANGES IN EQUITY FOR 2023

B) STATEMENTS OF CHANGES IN TOTAL EQUITY

(euros)

Subsidies,

Adjustments for

Legal

Other

Profit/(loss)

donations

changes

Capital

reserve

reserves

financial year

and bequests

of value

(Note 12)

(Note 14)

Total

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

928,788

314,055

312,056,266

Total recognised income and expenses

20,063,539

-56,351

-96,789

19,910,399

Other variations in equity

1,425,486

175,412

-14,254,857

-12,653,959

- Distribution of profit in 2022

1,425,486

175,412

-1,600,898

- Distribution of dividends

-12,653,959

CLOSING BALANCE FOR 2023

267,577,040

11,453,626

19,128,798

20,063,539

872,437

217,266

319,312,706

Notes 1 to 27 to the attached financial statements attached hereto form an integral part of the statement of changes in equity for 2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

CASH FLOW STATEMENT FOR 2023

(euros)

Notes

Financial year

2023

2022

A) CASH FLOWS FROM OPERATING ACTIVITIES

35,992,592

24,956,628

1. Profit (loss) before tax for the year

20,467,557

14,254,857

2. Adjustment to income:

6,796,605

10,645,802

a) Amortisation of fixed assets (+)

6 and 7

6,436,901

5,986,123

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

108,609

478,995

c) Variation in provisions (+/-)

233,408

171

d) Allocation of subsidies (-)

-56,351

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

-2,463,710

-350,824

f) Income from derecognition and disposals of financial instruments (+/-)

-985

g) Financial income (-)

-1,312,977

-402,994

h) Financial expenses (+)

5,298,569

2,073,585

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

-1,446,859

2,917,097

3. Changes in current capital:

12,442,835

1,531,127

a) Inventories (+/-)

-445,130

b) Trade and other receivables (+/-)

-948,295

-557,220

c) Other current assets (+/-)

-315,555

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

12,077,693

3,113,328

e) Other current liabilities (+/-)

253,151

-493,572

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

1,060,286

229,276

4. Other cash flows from operating activities:

-3,714,406

-1,475,158

a) Payments of interests (-)

-4,532,948

-1,865,136

b) Dividends receivable (+)

671,387

377,351

c) Collection of interests (+)

641,590

25,643

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

18.1

-494,435

-13,016

B) CASH FLOWS FROM INVESTMENT ACTIVITIES

-66,494,259

-54,113,819

6. Investment payments (-):

-75,314,460

-58,519,820

a) Group and associated companies

9 and 20.2

-10,000,000

c) Property, plant and equipment

-1,105

-151,353

d) Property investments

-65,313,355

-52,068,463

e) Other financial assets

-304,498

f) Non-current assets kept for sale

-5,995,506

7. Proceeds from divestments (+):

8,820,201

4,406,001

a) Group and associated companies

9 and 20.2

2,809,713

d) Property investments

5,487,019

4,406,001

e) Other financial assets

187,842

f) Non-current assets kept for sale

335,627

C) CASH FLOWS FROM FINANCING ACTIVITIES

33,429,902

29,850,598

10. Receivables and payables from financial liability instruments

46,083,862

44,998,722

a) Issue:

72,869,698

63,295,957

2. Bank borrowings (+)

72,869,698

59,872,437

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

9 and 20.2

3,423,520

b) Return and amortisation of:

-26,785,836

-18,297,235

1. Bonds and other marketable securities (-)

-2,000,000

2. Bank borrowings (-)

-26,785,836

-16,297,235

11. Dividend payments

-12,653,960

-15,148,123

a) Dividends (-)

-12,653,960

-15,148,123

D) EFFECT OF CHANGES IN INTEREST RATES

E) NET INCREASE/DECREASE IN CASH AND EQUIVALENTS

2,928,234

693,408

Cash or equivalent at start of year.

1,825,221

1,131,813

Cash or equivalent at end of year.

4,753,455

1,825,221

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 2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Notes to the Financial Statements

for the Year Ending

31 December 2023

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 June 2016

Maturity date

23 June 2021

23 June 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 2023 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 will 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 for that purpose, provided that

development is initiated within three years following its acquisition, as well as holdings in the capital

or assets of other entities referred to in paragraph 1 of Article 2 of the aforementioned Law.

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, as amended by Law 16/2012, of 27 December, as amended by Law

11/2021, of 9 July, which regulates Listed Real Estate Investment Trusts (SOCIMI).

- 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 2022 were approved without modification

by the General Shareholders' Meeting held on 27 April 2023.

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 2023, 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 2023, the Company had a negative working capital balance of 40,861,746 euros (negative

balance of 20,923,790 euros at 31 December 2022). This impairment to working capital is mainly due to the

increase in short term maturities of financial debt. However, the Board of Directors of the Company considers

that this fact does not constitute an uncertainty for the continuity of the Company, taking into account the

following mitigating factors:

- The Company recurrently generates significant positive EBITDA (EBITDA in 2023 amounts to

27,035,871 euros), so it is estimated that the future income to be received in the following year,

arising from the contracts associated with the real estate assets, will cover part of the Company's

obligations in the short term.

- The Company's equity book value is robust and healthy, amounting to 319,312,705 euros at 31

December 2023.

- The Company's real estate assets show significant unrealised gains based on their fair values at

year-end (note 7).

- The Company currently has sufficient financing facilities to meet the payment requirements for its

committed investments in the various property refurbishment and construction projects. The

Company has credit lines granted for an undrawn amount of 7,040,382 euros at 31 December 2023

(see note 14). The Company also has the financial support of the companies in the PER 32 Group,

which would provide the necessary financing, if required, on the basis of the mutual financing

framework agreement signed between the various companies in the Group (note 20.2).

- The Company is negotiating different long-term financing formulas for its real estate assets with

financial institutions in order to ensure that the schedules established for these obligations can be

matched to the debt repayment schedules. Transactions have been signed amounting to

25,000,000 euros after the year-end and at the time of preparing these financial statements, as

mentioned in note 27.

f) Comparison of the information

The information contained in this report which refers to 2023 is presented along with the 2022 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 2023.

4. Profit distribution

The proposal for the distribution of the Company's profits for 2023 to be submitted by the Directors of the

Company to the shareholders is as follows:

Euros

Basis of distribution:

Profit and Loss

20,063,539

Distribution:

Legal reserve

2,006,354

Voluntary reserve

2,100,747

Dividends

15,956,438

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 2023 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 31 January 2024, 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 2023 or 2022.

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 2023. 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.

5.13 Cash flow statement

The cash flow statement has been prepared using the indirect method and uses the following terms with the

meanings given below:

- Operating activities: activities that constitute the ordinary revenues of the company and other

activities that cannot be classified as investment or financing activities.

- Investing activities: activities acquiring, selling or otherwise disposing of long term assets and other

investments that are not classified as cash and cash equivalents.

- Financing activities: activities that result in changes in the amount and composition of equity and

liabilities that are not part of operating activities.

6. Property, plant and equipment

The balances at 31 December 2023 and 31 December 2022 and the changes in the various property, plant

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

2023

Euros

Balance at

31/12/2022

Recognitions

Derecognitions

31/12/2023

Cost:

Data processing equipment

6,065

-2,178

3,887

Furniture and fittings

9,109

1,105

10,213

Other fixtures

142,244

142,245

Total cost

157,418

1,105

-2,178

156,345

Accumulated depreciation:

Data processing equipment

-5,423

-272

2,178

-3,517

Furniture and fittings

-152

-929

-1,081

Other fixtures

-2,370

-14,225

-16,595

Total accumulated depreciation

-7,945

-15,426

2,178

-21,193

Net tangible fixed assets

149,473

-14,321

135,152

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 tangible fixed assets

1,152

148,321

149,473

The main additions to property, plant and equipment in 2023 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 this respect

totalled 1,105 euros (151,353 euros in 2022).

The main disposals in 2023 from property, plant and equipment relate to the elimination of a Wimax point at

the Isla Canela Golf Hotel.

The depreciation charge of 15,426 euros (3,032 euros in 2022) was recognised in the income statement for

the year 2023 under “Depreciation and amortisation” in the accompanying profit and loss account as at 31

December 2023.

During the financial years 2023 and 2022, no finance charge has been capitalised under property, plant and

equipment. Also, at 31 December 2023 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 2023 and 31 December 2022, the Company had fully

depreciated property, plant and equipment in use. At year-end 2023, the acquisition cost of this equipment

amounted to 10,908 euros (4,914 euros in 2022).

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 2023, in the opinion of

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

As at 31 December 2023 and 2022, 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 2023 and 2022.

7. Property investment

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

this item during 2023 and 2022 are as follows:

2023

Euros

Balance at

Disposals/

Balance at

31/12/2022

Additions

Reversals

Transfers

31/12/2023

Cost:

Properties for leases

506,948,194

20,796,021

-3,715,702

1,603,811

525,632,324

Ongoing real-estate investments

5,799,747

44,517,334

-1,603,811

48,713,270

Total cost

512,747,941

65,313,355

-3,715,702

574,345,594

Accumulated depreciation:

Properties for leases

-61,777,707

-6,421,440

692,393

-67,506,753

Total accumulated depreciation

-61,777,707

-6,421,440

692,393

-67,506,753

Impairment:

Properties for leases

-12,461,456

-344,990

236,381

-12,570,066

Total impairment

-12,461,456

-344,990

236,381

-12,570,066

Net property investments

438,508,778

58,546,925

-2,786,928

494,268,775

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

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

Cost at

31/12/2023

31/12/2022

Properties for leases

Land

250,231,964

241,654,180

Spread

275,400,360

265,294,014

Total cost

525,632,324

506,948,194

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 2023 were as follows:

Investments: Property investments made in 2023 totalled 65,313,355 euros (52,068,463 euros in 2022).

The main additions recorded under this heading relate mainly to the following investments:

- On 27 December 2023, the Company signed a public deed for the acquisition of two office buildings

located at calle Julián Camarillo, 19 and Julián Camarillo, 21, both in Madrid, owned by JC19

PROPCO 4, S.L. The total cost associated with these two transactions was 20,366,970 euros.

- There were additions to assets under construction amounting to 44,517,334 euros, corresponding

to the cost of renovating and refurbishing hotels amounting to 1,777,177 euros, the buildings at

Valle de la Fuenfría, 3 (706,006 euros) and Titán 13 (92,975 euros), as well as the Sexta Avenida

shopping centre (6,242,041 euros) and the start of construction work on the Valdebebas Hospital

and Hotel in Madrid (35,699,134 euros), which will be leased to Sanitas S.A. de Hospitales and

Melíá Hotels International, S.A., respectively, once completed. All of these assets are located in

Madrid.

- Furthermore, the Company has incurred in costs of 429,051 euros, capitalised as the cost of

property investment.

Disposals: Disposals in property for a gross amount of 3,715,702 euros (4,582,569 euros in 2022) were

made this year, The main derecognitions in 2023 relate to:

- Sale of several properties with their corresponding annexes in Vallecas Comercial I (1 unit),

Sanchinarro VII (1 unit) and Coslada III (1 unit) for a gross cost of 534,383 euros, which were sold

to third parties. These sales transactions gave rise to a combined net gain of 67,715 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 2023.

- On 31 July 2023, the resulting Urban Plot PR-4, belonging to the district of San Blas de Madrid,

included in API 20.12 Julián Camarillo Sur of the General Plan of Madrid 1997, was sold. A tertiary

commercial building had been built on this plot, located at calle Albalá 7, which has been disposed

of for a gross book cost of 2,873,300 euros. This divestment gave rise to a net gain of 2,395,995

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 2023.

- In addition, the Company has derecognised costs of 308,019 euros in the Conde de Peñalver

premises.

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

for the sum of 1,603,811 euros (7,128,552 euros in 2022), as a result of the completion of refurbishment

work on several hotels (928,805 euros), the office building at Calle Valle de la Fuenfría, 3 (508,607 euros)

and the office building at Calle Titán 13 (166,400 euros), all of them in Madrid.

Furthermore, the Company proceeded to appraise all of its real estate assets at year-end 2023 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. The net impact on the income statement for 2023 was therefore

negative in the amount of 108,609 euros (negative 478,996 euros in 2022).

Depreciation in 2023 totalled 6,421,440 euros (5,982,921 euros in 2022), 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

2023

2022

Cash flow discount

24%

25%

Capitalisation

64%

70%

DCF and residual

10%

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.

- CAPEX: Estimated investments (CAPEX) in each of the assets are included.

2023

The main assumptions used to calculate the fair value of the real estate assets for 2023 were as follows:

Euros

Current Income

ERV

Exit Yield

IRR

Hotels

N/A

6.82%

9.00%

Offices

13,414,365

16,193,077

5.01%

N/A

Retail

7,626,754

6,948,344

3.41%

N/A

Shopping centres

1,570,512

4,160,537

7.55%

9.55%

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%

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)

2023

2022

-0.25%

+0.25%

-0.25%

+0.25%

Hotels

4,026,698

-4,479,354

3,200,000

-3,100,000

Offices

16,010,000

-14,630,000

16,430,000

-14,730,000

Retail

14,166,000

-12,299,000

15,990,000

-13,740,000

Institutional

3,900,000

-3,600,000

4,100,000

-3,600,000

Total

38,102,698

-35,008,354

39,720,000

-35,170,000

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)

2023

2022

-10%

+10%

Offices

-25,130,000

24,900,000

-24,180,000

24,130,000

Retail

-19,390,000

19,411,000

-21,200,000

23,980,000

Total

-44,520,000

44,311,000

-45,380,000

48,110,000

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

IRR (Euros)

2023

2022

-0.25%

+0.25%

Hotels

3,603,610

-3,811,085

2,800,000

-2,700,000

Commercial (shopping centre

only)

710,000

-680,000

550,000

-530,000

Land

400,000

-400,000

Total

4,313,610

-4,491,085

3,750,000

-3,630,000

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 2023 for the sum of 108,609 euros (negative net impact of 478,996 euros at 31

December 2022); the breakdown by asset type and changes in provision for impairment of property

investments is as follows:

Euros

2023

2022

Balance at beginning of year

-12,461,457

-11,982,461

Hotels

-198,538

-508,175

Retail

-146,452

-156,225

Impairment

-344,990

-664,400

Offices

147,972

Retail

236,381

37,433

Reversals

236,381

185,405

Balance, end of year

-12,570,066

-12,461,457

Furthermore, based on the valuations performed, the fair value of property investments shows an

unrecognised gain (by comparison between the gross updated market fair value and the net carrying value)

of 247,439,373 euros (241,849,266 at 31 December 2022) considering in both figures the current residual

value of the two buildings under construction in Valdebebas (hotel and hospital).

The gross market value of property investments (considering the H.E.T. or “completed building assumption”

in the case of the two ongoing Valdebebas projects) at 2023 year-end amounted to 795,908,004 euros

(774,460,463 euros at 2022 year-end). The breakdown by business segment is as follows:

Gross market value of the

Property investments (Euros) (*)

31/12/2023

31/12/2022

Hotels (**)

211,158,528

204,000,000

Offices

304,822,198

285,681,522

Retail

205,927,278

211,478,941

Institutional (**)

74,000,000

73,300,000

Total

795,908,004

774,460,463

(*) The net market value at 31 December 2023 came to 774,013,880 euros ( 755,866,500 euros in 2022).

(**) 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 2023 amounts to 741,708,148 euros (2022: 680,358,044 euros), with a net value of 721,209,000

euros (2022: 664,116,641 euros). The estimated cost to be incurred in both projects until completion is as follows: Hotel (18,598,844 euros)

and Hospital (29,828,505 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

31/12/2023

31/12/2022

Hotels

99,408

Offices

76,277

62,406

Retail

40,030

40,852

Institutional

19,273

Total

234,987

221,938

At 31 December 2023, the average occupancy rate of the Company's leased assets was 83% (92% at 31

December 2022) 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 104,182,095 euros

at 31 December 2023 (62,461,471 euros at 31 December 2022), corresponding to bank mortgage-backed

loans.

The breakdown of the mortgage loan balance pending maturity and repayment at 31 December 2023 and

2022 by assets is as follows:

Property

Euros

2023

2022

José Abascal, 41

8,892,000

9,690,000

Titán, 13

8,896,495

9,708,654

Conde de Peñalver, 16

5,776,643

6,303,992

Valle de la Fuenfría, 3

7,274,621

7,763,333

Juan Ignacio Luca de Tena, 17

9,981,936

10,545,492

Glorieta de Cuatro Caminos 6 and 7.

3,100,000

3,450,000

Arapiles 14

24,000,000

12,000,000

Hospital Valdebebas

16,196,400

Hotel Valdebebas

20,064,000

3,000,000

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

104,182,095

62,461,471

NB: The net book value of these mortgage-backed properties at 31 December 2023 amounted to 224,008,687 euros (175,347,345 euros

at 31 December 2022).

In 2023, the rental income from real estate investments belonging to the Company comes to 34,674,207

euros (30,644,323 euros in 2022). This figure includes income from the passing on of operating expenses

for all related items, which amounted to 868,682 euros in 2023 (1,047,429 euros in 2022).

At year-end 2023, 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 2023 year-end, the Company had fully amortised property investments which were still in use amounting

to 10,425,990 euros (8,811,387 euros at 2022 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 2023, there will be no shortfalls relating to any of the aforementioned risks.

8. Operating leases

At the end of 2023 and 2022, 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

2023

2022

Less than a year

31,075,627

29,272,582

Between one and five years

119,670,583

87,953,936

More than five years

118,685,132

103,961,317

Total

269,431,342

221,187,835

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

unexpired lease term) is provided below:

WAULT

31/12/2023

31/12/2022

Hotels

9.19

8.64

Offices

6.20

6.52

Retail

9.88

11.07

Institutional

10.00

Total Average

8.83

9.10

9. Other financial assets and investments in related companies

The balances of the accounts in this item at year-end 2023 and 2022 are as follows:

Euros

Balance at

31/12/2023

31/12/2022

Financial assets at amortised cost

Derivatives

217,266

314,055

Other financial assets

2,574,851

2,706,786

Long-term / non-current

2,792,117

3,020,841

Other financial assets

608,494

796,336

Short-term / Current

608,494

796,336

Total

3,400,611

3,817,177

Euros

Balance at

31/12/2023

31/12/2022

Assets at fair value through

profit or loss

Other financial assets

17,590,326

16,478,110

Short-term / Current

17,590,326

16,478,110

Total

17,590,326

16,478,110

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

short and long term during the financial years 2023 and 2022 is as follows:

2023

Euros

Balance at

Adjustment

Balance at

31/12/2022

Value

Disposals

31/12/2023

Equity instruments

16,478,110

1,446,859

-334,643

17,590,326

Derivatives

314,055

-96,789

217,266

Other financial assets

3,503,121

-319,775

3,183,346

Total

20,295,286

1,350,070

-654,418

20,990,938

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

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 13 September

2023, the Company sold these shares, obtaining a gain of 985 euros, which was recognised under “Income

from sales of financial instruments” at 31 December 2023 (0 euros in 2022). In addition, valuation losses of

3,336 euros (90,281 euros in 2022) were recognised for this asset in 2023.

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 2023, the

Company valued these shares, obtaining a negative value adjustment of 1,450,196 euros, which was

recognised under “Results of trading portfolio” (negative value of 2,826,816 euros in 2022).

During 2023, the Company received dividends associated with these financial investments for the sum of

671,387 euros (377,351 euros in 2022). 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

Fair value at

Change

Method

31/12/2023

31/12/2022

31/12/2023

31/12/2022

2023

Level

Inmobiliaria Colonial SOCIMI, S.A.

17,544,042

17,590,326

16,140,131

1,450,195

Listing

Total

17,544,042

17,590,326

16,140,131

1,450,195

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 2023.

Derivative

At 31 December 2023 there was a variation of 96,790 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 "Other non-current financial assets" and "Other non-current financial assets" items reflect the bonds

connected with the leases set out in Note 8 received from clients and deposited with public authorities.

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

December 2023 is as follows:

Euros

2028

2024

2025

2026

2027

and subsequent

Total

Other financial assets

608,494

298,542

662,536

43,126

1,570,647

3,183,346

Total

608,494

298,542

662,536

43,126

1,570,647

3,183,346

The breakdown by maturity 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

10. Trade and other accounts receivable

The breakdown of the item at year-end 2023 and 2022 was as follows:

Euros

31/12/2023

31/12/2022

Accounts receivable for sales and services

3,162,792

4,174,532

Staff

864

944

Current tax assets (18.2)

110,779

20,362

Other credits with Public Administrations (Note 18.1)

1,105,796

9,837

Total

4,380,231

4,205,675

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

end 2023 and 2022:

Euros

31/12/2023

31/12/2022

Customers

2,649,239

3,848,969

Customers, invoices to be formalised

152,024

Commercial paper in portfolio

299,845

314,446

Outstanding papers

61,684

11,117

Customers with doubtful debts

13,195

3,494

Impairment

-13,195

-3,494

Total

3,162,792

4,174,532

The customer balance at the end of 2023 primarily includes some of the amounts pending payment

corresponding to income from the fourth quarter of 2023 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.

Changes in the impairment of customers recognised is as follows, with an impact on the income statement

for the year 2023 of 9,701 euros (171 profit for the year 2023):

Euros

2023

2022

Balance at beginning of year

-3,494

-3,665

Impairment of customers

-9,701

-3,494

Reversal of commercial credits

3,665

Balance, end of year

-13,195

-3,494

11. Cash and cash equivalents

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

December 2023 and 2022. 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 2023, it did not have any assets or liabilities

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

d) Interest rate risk

Interest rate fluctuations change the fair value of assets and liabilities accruing fixed interest rates, as well as

the future flows of assets and liabilities tied to variable interest rates. Although it takes into account the use

of hedging transactions in order to achieve a balance in the debt structure that minimises the cost of debt

over the multi-year horizon with reduced volatility in the income statement.

Therefore, 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 2023, 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 2023 were 69.00, 68.50 and 67.83 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

2023 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%

The Company belongs to the PER 32 Group, whose ultimate Parent Company is PER 32, S.L., domiciled in

Madrid, which files the consolidated financial statements with the Madrid Companies Registry

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 2023, the legal reserve had not yet been fully allocated.

Voluntary reserve

Following the distribution of the Company’s profit in 2022, the balance of this equity item came to 4,974,058

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) 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 together 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.

d) 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.

e) Adjustments for changes in value

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

Euros

31/12/2023

31/12/2022

Hedging operations (Note 15)

217,266

314,055

Total

217,266

314,055

f) Capital grants

The activity in this heading during 2023 and 2022 was as follows:

2023

Euros

31/12/2022

Applications

31/12/2023

Capital grants

928,789

-56,351

872,437

Total

928,789

-56,351

872,437

2022

Euros

31/12/2021

Applications

31/12/2022

Capital grants

985,139

-56,351

928,789

Total

985,139

-56,351

928,789

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 2023, 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 (552,152 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 (320,285 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 2023, an amount of 56,351 euros (56,351 euros in 2022) 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 2023 and 2022 are as follows:

Euros

31/12/2023

31/12/2022

Long-term debts with credit institutions

132,193,018

104,798,848

Other financial liabilities

3,934,179

3,900,223

Total long-term liabilities

136,127,197

108,699,071

Short-term debts with credit institutions

54,481,696

35,026,384

Other financial liabilities

528,154

488,482

Total current payables

55,009,851

35,514,866

Total current and non-current financial debts

191,137,048

144,213,937

Financial assets at amortised cost

Non-current and current bank borrowings

At 31 December 2023, the Company’s bank borrowings came to 186,674,715 euros (139,825,232 euros at

31 December 2022).

The mortgage loans in force at 31 December 2023, 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

8,892,000

2031

Titán, 13

Banco Santander

2015

15,735,000

8,896,495

2025

Conde de Peñalver, 16

Banco Santander

2015

10,217,000

5,776,643

2025

Valle de la Fuenfría, 3

Kutxabank

2018

10,000,000

7,274,621

2028

Juan Ignacio Luca de Tena, 17

CaixaBank

2019

12,000,000

9,981,936

2030

Glorieta de Cuatro Caminos 6 and 7,

Banca March

2018

4,500,000

3,100,000

2028

Arapiles 14

Bankinter

2022

24,000,000

2037

Hotel Valdebebas (*)

Banco Santander

2022

33,000,000

20,064,000

2035

Hospital Valdebebas (*)

Banco Santander

2023

36,000,000

16,196,400

2036

Total

156,852,000

104,182,095

Opening costs

Bankinter

2022

-293,439

Total

156,852,000

103,888,656

(*) These loans are intended to finance construction work. The loans for the Valdebebas Hotel and Valdebebas Hospital were agreed with

Banco Santander and the drawdown of up to 33,000,000 euros and up to 36,000,000 will take place during the building's construction

years, based on the progress of construction.

The personal guarantee loans in force at 31 December 2023 have the following characteristics:

Start

Maturity

Euros

Initial amount

Outstanding capital

Banco Santander

2020

2025

12,000,000

6,092,933

Banco Santander

2021

2026

30,000,000

17,201,709

Abanca

2022

2027

3,000,000

2,100,000

Pichincha

2022

2025

5,000,000

2,551,846

Banca Pueyo

2022

2030

5,000,000

Banca Pueyo

2022

2030

5,000,000

4,821,429

Bankinter

2022

2032

10,000,000

9,400,000

Banco Santander

2023

2024

10,000,000

BBVA

2023

2024

17,000,000

Total

97,000,000

74,167,916

In addition, the heading “Short-term bank borrowings” includes three credit facilities, two entered into 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

21 January 2024, and another with Banca March with a limit of 7,500,000 euros with a maturity of 11 January

2025.. These policies are drawn down at 31 December 2023 in the amount of 7,459,618 euros (6,872,437

euros at 31 December 2022). Furthermore, accrued and unpaid interest at 31 December 2023 came to

1,158,525 euros (392,903 euros at 31 December 2022).

The financial expenses arising from debts with credit institutions in 2023 amounted to 5,174,990 euros

(1,914,180 euros in 2022) 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 2023 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

2023 and amounts to 293,439 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.

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 2023 is as follows:

Euros

2028

2024

2025

2026

2027

and

subsequent

Total

Debts with credit institutions (*)

54,459,580

30,972,889

8,505,150

6,842,564

85,894,531

186,674,715

Long-term bonds and deposits

351,986.32

1,601,968.92

157,771.94

1,822,452

3,934,179

Short-term bonds and deposits

528,154

Total

54,987,735

31,324,875

10,107,119

7,000,336

87,716,983

191,137,048

(*) Mortgage-backed loans in the amount of 104,182,095 euros, loans with a personal guarantee in the amount of 74,167,916 euros,

drawdowns on credit facilities in the amount of 7,459,618 and interest accrued pending maturity in the amount of 1,158,525 euros.

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.

15. Hedge instruments

The breakdown of derivative financial instruments at 2023 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

217,266

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

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 reduction of 96,790 euros in 2023 (increase of 597,063 euros in 2022), which has been

recorded in the Company's equity under the “Adjustments for changes in value” heading.

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.

2023

2022

Days

Average payment period to suppliers

54.57

44.48

Ratio of paid transactions

58.33

49.84

Ratio of transactions pending payment

45.07

21.88

Euros

Total payments made

32,966,886

15,562,518

Total payments pending

13,040,320

3,689,510

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 2023 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:

2023

2022

Average payment period – invoices paid in a period shorter than the legal maximum period

25.49

26.09

Number of invoices paid in less than the maximum legal period

1,808

1,520

Percentage of total number of paid invoices

60.11%

66.61%

Amount

Amount of invoices paid in less than the legal maximum time limit.

17,222,302

13,037,097

Percentage of the total amount of paid invoices

56.00%

83.77%

17. Guarantees undertaken with third parties

At 31 December 2023, the Company had been granted two guarantees from Kutxabank to the Madrid City

Council for the proper disposal of waste in the amount of 6,431 euros for the one-off refurbishment works of

the building at 42 Calle Pradillo, and for 34,259 euros for the works at the Sexta Avenida Shopping Centre

in Madrid.

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

31/12/2023

31/12/2022

Owed

Due

Owed

Due

Withholdings during the year

20,362

Withholdings from previous years

9,837

Value Added Tax

1,105,796

562,065

306,938

Personal Income Tax

21,590

51,381

Rent withholdings

505

Withholdings on movable capital

23,480

30,287

Corporation tax

110,779

Social Security

9,533

7,483

Total

1,216,575

617,173

30,199

396,594

The heading Value Added Tax has a credit and debit balance due to the result of the VAT settlement for the

month of November 2023 in the amount of 562,065 euros debited on 2 January 2024. The debit amount of

1,105,796 euros is VAT to be offset as a result of the settlement of December 2023.

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 2023 and 2022 was

as follows:

Euros

2023

2022

Profit (loss) before tax

20,467,557

14,254,856

Permanent differences

Temporary differences

-104,170

162,102

Prior tax base

20,363,386

14,416,958

Tax base (0%)

18,387,909

14,416,958

Tax base (25%)

1,975,478

Offsetting of negative tax bases

-357,592

Tax base at 0%

18,387,908

14,416,958

Tax base at 25%

1,617,886

Total tax liability (0%)

Total tax liability (25%)

404,472

Deductions

-453

Tax due

404,018

Withholdings and interim payments

-514,797

-20,362

Net (payable)/refunded

-110,779

-20,362

Temporary differences in 2023 that changed the pre-tax accounting profit amounted to a negative 321,388

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 212,779 euros.

- Upward adjustment for the impairment of property investments in 2023 in the amount of 344,990

euros.

- Downward adjustment as a consequence of the reversal of impairment on real estate investments

amounting to 236,381 euros.

At the end of 2023, the Company has temporary differences pending allocation of 5,525,707 euros

(5,847,095 euros in 2022), 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 212,779 euros, in addition to the impairment of property investments in

the amount of 5,312,928 euros.

At 31 December 2023, the Company has no tax loss carryforwards to offset, having offset them all this year

(357,592 euros at 31 December 2022).

At the end of 2023, there were no financial expenses that have not been deducted from the tax base for

corporation tax.

Likewise, at 31 December 2023 there are tax credits to be applied as the outstanding tax credit for donations

in this year has been applied (453 euros at 31 December 2022).

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 2023 year-end the directors proposed

to the shareholders to pay dividends of 15,956,437 euros (12,653,959 euros in 2022) and, accordingly,

corporation tax was payable on this dividend in the amount of 0 euros. The after-tax profit for 2023 amounted

to 20,063,539 euros (14,254,856 euros in 2022).

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. As a result of

the sale of property assets in 2023, a net gain of 3,707,603 euros was obtained and the following distribution

of profit is proposed:

• From the gain from the sale of real estate assets acquired in the pre-Real Estate Investment Trust

period taxed at 25% and amounting to 1,975,478 euros, the Company's directors propose allocating

10% to the legal reserve (230,058 euros) and 90% to the voluntary reserve (2,070,525 euros) from

the accounting profit generated (2,300,583 euros).

• For the rest of the gain originating from the sale of real estate assets acquired in the pre-Real Estate

Investment Trust period amounting to 1,732,125 euros, the Company's directors propose allocating

10% to the legal reserve (6,716 euros), 45% to the voluntary reserve (30,222 euros) and the other

45% to distribution of dividends (30,222 euros), from the accounting profit generated (67,161

euros).

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 (sold in 2023)

- 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 2023

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

Pradillo, 42

17,762,500

18,227,308

464,808

Total

65,642,225

71,433,808

5,791,583

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 2023

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 2023

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. Reconciliation between the accounting profit and corporation tax expenses

The reconciliation between the accounting profit or loss and the corporation tax base for the years ending

31 December 2023 and 2022 is as follows:

Euros

2023

2022

Profit (loss) before tax

20,467,557

14,254,856

Permanent differences

Temporary differences

-104,170

162,102

Prior tax base

20,363,387

14,416,958

Tax base (0%)

18,387,909

14,416,958

Tax base (25%)

1,975,478

Offsetting of negative tax bases

-357,592

Tax base at 0%

18,387,909

14,416,958

Tax base at 25%

1,617,886

Total tax liability (0%)

Total tax liability (25%)

404,472

Deductions

-453

Tax expense recognised in the profit and loss account

404,018

18.4. 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 2023, 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.

18.5. 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 2023 and 2022 is as follows:

Euros

2023

2022

Hotels

10,325,785

9,747,961

Offices

15,187,824

11,331,546

Retail

9,436,236

9,564,815

Rental subtotal

34,949,845

30,644,323

Provision of sundry services

28,615

63,007

Capital grants taken to profit and loss

56,351

Total income

35,034,811

30,763,680

The Company's entire turnover in 2023 and 2022 was generated in Spain.

19.2 Staff costs

The balance of this item in 2023 and 2022 was comprised as follows:

Euros

2023

2022

Wages and salaries:

Wages, salaries and similar outgoings

427,118

358,311

National Insurance contributions:

Social Security contributions incurred by the company

92,117

74,088

Other social expenses

55,051

53,704

Total

574,286

486,103

19.3 External charges for services, taxes and similar levies

The breakdown of this item for 2023 and 2022 is as follows:

Euros

2023

2022

Leases

52,933

27,921

Repairs and maintenance

1,224,454

851,544

Independent professional services

437,361

365,912

Insurance policies

99,380

78,669

Banking services and similar

8,035

9,012

Advertising and public relations

48,866

21,951

Supplies

1,301,591

1,245,470

Other services

477,167

410,322

Other levies

3,718,515

2,289,343

Total

7,368,302

5,300,144

20. Related-party transactions and balances

20.1 Related-party transactions

The transactions made with related companies in 2023 and 2022 were as follows:

2023

Euros

31/12/2023

Financial

Income

Financial

Income

income

Isla Canela, S.A.

89,455

221,305

113,515

Promociones y Construcciones PYC Pryconsa, S.A.

2,191,936

25,779

511,713

Planificación Residencial y Gestión, S.A.U.

34,190

610

31,327

Cogein, S.L.U.

472

10,064

Propiedades Cacereñas, S.L.U.

321

Triangulo Plaza Cataluña, S.L.

210

Jardins Sottomayor - Imobiliária e Turismo, SA

3,209

Cotos Capital S.L.

317

Pryconsa Senyor, S.L.

9,711

Promoción, Gestión y Marketing Inmobiliario, S.L.

457

38,630

Total

2,315,581

262,391

123,579

581,670

2022

Euros

31/12/2022

Financial

Income

income

Isla Canela, S.A.

126,218

108,891

Promociones y Construcciones PYC Pryconsa, S.A.

670,098

25,253

26,519

Planificación Residencial y Gestión, S.A.U.

5,317

689

Cogein, S.L.U.

751

132,886

Propiedades Cacereñas, S.L.U.

294

Triangulo Plaza Cataluña, S.L.

260

Jardins Sottomayor - Imobiliária e Turismo, SA

3,267

Codes Capital Partners, S.L.U.

Cotos Capital S.L.

322

Pryconsa Senyor, S.L.

5,813

Promoción, Gestión y Marketing Inmobiliario, S.L.

1,208

Per 32, S.L.

183

Total

801,633

146,931

159,405

At 31 December 2023, the relationship between the companies with which the Company has relevant

“Related party transactions and balances” is as follows:

- Isla Canela, S.A.: This company is 93.90% owned by PER 32, S.L., which is the holding company

of the group where the company is finally consolidated.

- Promociones y Construcciones PYC Pryconsa, S.A.: Direct shareholder of the Company with an

11.19% stake.

- Planificación Residencial y Gestión, S.A.U.: A company in which Promociones y Construcciones

PYC Pryconsa, S.A. holds an 100% interest.

- Cogein, S.L.U.: Company 100% owned by PER 32, S.L.

- Propiedades Cacereñas, S.L.U.: Company 100% owned by PER 32, S.L.

- Triangulo Plaza Cataluña, S.L.: A company in which Promociones y Construcciones PYC

Pryconsa, S.A. holds 44.42% and Cogein, S.L.U. 55.58%.

- Jardins Sottomayor - Imobiliária e Turismo, S.A.: A Portuguese company ultimately owned by

Marco Colomer Barrigón and José Luis Colomer Barrigón (both members of the Board of Directors

of the Company and direct shareholders of the Company).

- Cotos Capital S.L.: Company owned 54% by PER 32, S.L. and 46% by Codes Capital Partners,

S.L.U. (the latter is wholly owned by PER 32, S.L.).

- Pryconsa Senyor, S.L.: 36.08% owned by Cogein and 63.92% owned by Promociones y

Construcciones PYC Pryconsa, S.A.

- Promoción, Gestión y Marketing Inmobiliario, S.L.: This company is 51.08% owned by Cogein,

S.L.U. and ultimately owned by Marco Colomer Barrigón and José Luis Colomer Barrigón (both

members of the Company's Board of Directors and direct shareholders of the Company).

20.2 Balances with Group and related companies

Balances with related companies at 31 December 2023 and 2022 are as follows:

2023

Euros

Loans granted to related

companies

Loans received from

related companies

Cogein, S.L.U.

6,270,230

Promociones y Construcciones PYC Pryconsa, S.A.

10,000,000

Total

10,000,000

6,270,230

2022

Euros

Loans granted to related

companies

Loans received from

related companies

Cogein, S.L.U.

3,461,920

Total

3,461,920

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 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.

- 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.

- On 1 April 2023, the various companies in the PER 32 group signed a framework agreement under

which they agreed to establish a multilateral services provision service, under which any company

can provide one or more services in the activity of various areas. 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

with 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.

21. Remuneration for the Board of Directors and Senior Management

The total remuneration due in 2023 and 2022 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

2023

2022

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 2023 and 2022, 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 2023 and 2022, 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 2023 and 2022:

2023

2022

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 2023, 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 2023 and 2022 broken down by job category is as follows:

2023

2022

Management

Technical staff

Administrative staff

Total

Likewise, the distribution by gender at the end of 2023 and 2022 broken down by category was as follows:

2023

2022

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 2023 and

2022.

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 2023 and 2022:

Euros

Services provided by the auditor of

accounts and related companies

2023

2022

Audit services

30,600

29,380

Other verification services

Total audit and related services

30,600

29,380

Tax advisory services

Other services

Total professional services

30,600

29,380

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 2023 and 2022, 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

2023

Euros

Hotels

Offices

Retail

Others

Total

Income

10,325,785

15,207,228

9,445,448

34,978,460

Indirect costs

-1,238,655

-3,427,483

-2,436,042

-7,102,179

Net Margin

9,087,130

11,779,745

7,009,406

27,876,281

General expenses

-248,092

-365,376

-226,941

-840,410

EBITDA

8,839,037

11,414,369

6,782,465

27,035,871

% of income

85.60%

75.06%

71.81%

77.29%

Depreciation

-2,288,731

-3,020,644

-1,112,065

-15,460

-6,436,901

Subsidies

56,351

Extraordinary profits (losses)

4,585

Profit/(loss) on disposal of real estate assets

2,463,710

Impairment/Reversal of trade operations

-9,701

Impairment/Reversal of real estate assets

-198,538

89,929

-108,609

Financial profit (loss)

-2,505,699

-294,890

262,839

-2,537,749

EBT

6,412,704

8,351,736

5,465,440

237,678

20,467,557

Corporation tax

-404,018

Net profit (loss)

6,412,704

8,351,736

5,465,440

-166,340

20,063,539

% of income

62.10%

54.92%

57.86%

0.00%

57.36%

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

172

-20,593

Profit/(loss) on disposal of real estate assets

350,824

Impairment/Reversal of real estate assets

-478,996

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%

The breakdown of the income and net book value of real estate assets, including property, plant and

equipment in progress, at 31 December 2023 and 31 December 2022 is as follows:

Euros

31/12/2023

31/12/2022

Income

Net cost

Income

Net cost

Hotels

10,325,785

30%

135,536,452

9,785,315

32%

117,556,061

Offices

15,207,228

43%

228,032,522

11,352,483

37%

209,919,449

Retail

9,445,448

27%

99,476,270

9,569,532

31%

96,818,388

Institutional

31,223,531

14,214,881

Total

34,978,460

100%

494,268,775

30,707,329

100%

438,508,778

The breakdown of contribution to income from a geographic standpoint is as follows:

Euros

31/12/2023

31/12/2022

Income

Madrid

26,283,435

76%

22,306,777

72.64%

Huelva

8,695,025

25%

8,400,553

27.36%

Total

34,978,460

100%

30,707,329

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

2023 amounted to 83% of the floor space (sq.m.) leased (92% in 2022), which breaks down as follows:

31/12/2023

31/12/2022

Occupation

Hotels

99,408

100%

99,408

100%

Offices

76,277

71%

62,406

95%

Retail

40,030

59%

40,852

62%

Institutional

19,273

100%

19,273

100%

Total

234,987

83%

221,938

92%

During 2023, the occupancy rate of the properties was reduced by 8 points compared to that of 31 December

2022, mainly due to the start of work on the Sexta Avenida shopping centre, which led to the closure of the

shops until the next opening.

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 2023 and 2022, 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 2023 until the date of preparation of the Company's financial statements for 2023, no

relevant events have occurred that need to be specified in this section, with the exception of the following:

- On 11 January 2024, the Company entered into a personal guarantee loan of 15,000,000 euros

with Banco March in order to finance its working capital. This loan has a maturity of 24 months with

tacit renewal at the end of the first 12 months.

- On 28 February 2024, the Company renewed a short term personal guarantee loan of 10,000,000

euros with Banco Santander which, in addition to being renewed at maturity, has been extended to

5 years with partial annual repayments and a final repayment of 50% of the initial principal amount.

Annex 1. Reporting requirements as a REIT

Description

2023

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 in 2022 allocated to reserves: 1,600,898 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 in 2022 allocated to reserves: 1,600,898 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

- Distribution of dividends in 2022: 12,653,959 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

- Distribution of dividends in 2022: 12,653,959 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 April 2016

- 2016 dividends: 29 June 2017

- 2017 dividends: 26 April 2018

- 2018 dividends: 25 April 2019

- 2019 dividends: 30 June 2020

- 2020 dividends: 29 April 2021

- 2021 dividends: 27 April 2022

- 2022 dividends: 27 April 2023

Dividends distributed by the absorbed company COMPAÑÍA IBÉRICA DE

BIENES RAÍCES 2009, SOCIMI, S.A.U.

- 2009 dividends: 29 June 2010

- 2010 dividends: 30 June 2011

- 2011 dividends: 28 June 2012

- 2012 dividends: 20 June 2013

- 2013 dividends: 30 June 2014

- 2014 dividends: 22 June 2015

- 2015 dividends: 01 April 2016

Dividends distributed by the absorbed company INVERETIRO, SOCIMI,

S.A.U.

- 2015 dividends: 01 April 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

- 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

- Offices Julián Camarillo 19: 27/12/2023

- Offices Julián Camarillo 21: 27/12/2023

g) Acquisition date of interests in the capital of the

entities referred to in paragraph 1, Article 2 of this

Law.

2020: Inmobiliaria Colonial: 1,572,296 shares

2021: Inmobiliaria Colonial: 1,113,250 shares

(Total current value of Inmobiliaria Colonial 17.59 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

36.88

Barceló Isla Canela

28.72

Vila Galé Isla Canela

26.16

Meliá Innside Gran Vía

24.85

Playa Canela

17.68

Isla Canela Golf

5.68

Hotel Valdebebas (under construction)

33.59

Hotels

173.54

Pradillo 42

22.43

Sanchinarro VI

5.65

Sanchinarro VII

0.86

Titán 13

32.07

Valle de la Fuenfría, 3

19.05

José Abascal 41

25.73

Juan Ignacio Luca de Tena,17

30.80

Avda. Cantabria, 51

16.75

Santiago Compostela, 100 bis

22.33

Orense 62

4.43

Arapiles 14

36.32

Coslada III

0.01

Vallecas Comercial I

1.76

Julián Camarillo, 19

9.14

Julián Camarillo, 21

11.23

Gran Vía 1 (2º derecha)

2.87

Gran Vía 1 (1º derecha)

3.01

Gran Vía 1 (2º izquierda)

1.94

Offices

246.38

Gran Vía 34

21.53

Plaza España

15.10

Conde Peñalver 16

20.12

Gran Vía 55

13.46

Cuatro Caminos 6

7.12

Goya 59

15.81

Sexta Avenida shopping centre

17.19

Vallecas Comercial II

3.91

Marina Isla Canela Shopping Mall

4.72

Gran Vía 1 (1º izquierda)

2.73

Dulcinea 4

1.53

Retail

123.20

Valdebebas Hospital (under construction)

31.22

Institutional

31.22

Total real estate assets

574.35

Inmobiliaria Colonial:

17.59

Total:

591.94

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

2023

SAINT CROIX HOLDING IMMOBILIER, SOCIMI, S.A.

Management report at year-end 2023

1. Explanation of figures at 31 December 2023

A breakdown of the main figures at 31 December 2023 compared to 31 December 2022 is provided below:

Euros

31/12/2023

31/12/2022

+ / -

Income

34,978,460

30,707,330

14%

Leases

34,949,845

30,644,323

Provision of sundry services

28,615

63,007

Operating expenses

-7,102,179

-5,152,512

38%

Net operating income (NOI)

27,876,281

25,554,818

General expenses

-840,410

-633,736

33%

EBITDA

27,035,871

24,921,082

Financial profit (loss)

-2,537,749

-4,587,688

-45%

EBTDA

24,498,122

20,333,394

20%

Depreciation

-6,436,901

-5,986,123

Subsidies

56,351

Impairment/Reversal of trade operations

-9,701

Impairment/Reversal of real estate assets

-108,609

-478,996

Other gains (losses)

4,585

-20,593

Gains (losses) Disposal of real estate assets

2,463,710

350,824

EBT

20,467,557

14,254,857

44%

Corporation tax

-404,018

Net profit (loss)

20,063,539

14,254,857

41%

Sector indicators at 31 December 2023 and 31 December 2022

Euros

31/12/2023

Per share

31/12/2022

Per share

Recurring net profit

16,520,311

3.71

17,341,974

3.90

Net value of assets

566,752,078

127.30

553,905,533

124.41

Costs

7,942,589

5,786,247

Income

34,978,460

30,707,329

Cost/income ratio

22.71%

18.84%

Vacancy ratio

13.35%

7.11%

Net profitability

4.42%

Main figures at 31 December 2023 and 31 December 2022

Financial year

31/12/2023

31/12/2022

Annualized income (millions)

31.08

29.27

FFO (mn)

27.01

24.84

FFO (/share)

6.07

5.58

GAV (mn)

741.71

680.36

NAV (mn)

566.75

553.59

ROA

3.83%

3.06%

ROE

6.28%

4.57%

Gross leasable surface area (risk-free m

) (*)

234,987

221,938

% occupancy at year end

83.47%

92%

Lease portfolio (mn)

269.43

221.19

WAULT

8.83

9.10

LTV

23.25%

19.91%

Net Financial debt (millions €)

171.70

137.69

LTV (with Group debt)

0.24

20.41%

Net Financial debt (with Group debt) (millions €)

177.97

141.15

Profit (euro/share)

4.51

3.20

Dividend (euro/share)

3.58

2.84

Gross profitability via dividend

5.28%

4.32%

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 2023, the Company's gross property investments came

to 574,345,594 euros. In 2023, the following investments and disinvestments took place:

Investments: Property investments made in 2023 totalled 65,313,355 euros (52,068,463 euros in 2022).

The main additions recorded under this heading relate mainly to the following investments:

- On 27 of December 2023, the Company signed a public deed for the acquisition of two office

buildings located at calle Julián Camarillo, 19 and Julián Camarillo, 21, both in Madrid, owned by

JC19 PROPCO 4, S.L. The total cost associated with these two transactions was 20,366,970 euros.

- There were additions to assets under construction amounting to 44,517,334 euros, corresponding

to the cost of renovating and refurbishing hotels amounting to 1,777,177 euros, the buildings at

Valle de la Fuenfría, 3 (706,006 euros) and Titán 13 (92,975 euros), as well as the Sexta Avenida

shopping centre (6,242,041 euros) and the start of construction work on the Valdebebas Hospital

and Hotel in Madrid (35,699,134 euros), which will be leased to Sanitas S.A. de Hospitales and

Melíá Hotels International, S.A., respectively, once completed. All of these assets are located in

Madrid.

- Furthermore, the Company has incurred in costs of 429,051 euros, capitalised as the cost of

property investment.

Disposals: Disposals in property for a gross amount of 3,715,702 euros (4,582,569 euros in 2022) were

made this year, The main derecognitions in 2023 relate to:

- Sale of several properties with their corresponding annexes in Vallecas Comercial I (1 unit),

Sanchinarro VII (1 unit) and Coslada III (1 unit) for a gross cost of 534,383 euros, which were sold

to third parties. These sales transactions gave rise to a combined net gain of 67,715 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 2023.

- On 31 July 2023, the resulting Urban Plot PR-4, belonging to the district of San Blas de Madrid,

included in API 20.12 Julián Camarillo Sur of the General Plan of Madrid 1997, was sold. A tertiary

commercial building had been built on this plot, located at calle Albalá 7, which has been disposed

of for a gross book cost of 2,873,300 euros. This divestment gave rise to a net gain of 2,395,995

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 2023.

- In addition, the Company has derecognised costs of 308,019 euros in the Conde de Peñalver

premises.

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

for the sum of 1,603,811 euros (7,128,552 euros in 2022), as a result of the completion of refurbishment

work on several hotels (928,805 euros), the office building at Calle Valle de la Fuenfría, 3 (508,607 euros)

and the office building at Calle Titán 13 (166,400 euros), all of them in Madrid.

Dividends:

- Dividends payable by the Company to shareholders in 2024:

The proposed distribution of results for the 2023 year to be made by the directors of the Company to the

shareholders is as follows:

Euros

Profit at 31 December 2023

20,063,539

Legal reserve

2,006,354

Voluntary reserve

2,100,748

Dividends

15,956,437

The proposed distribution of profits to be made by the directors of the Company to the General Shareholders

Meeting entails the distribution, as dividends charged to 2023 profits, of 3.58 euros per share.

- Dividends paid out by the Company to shareholders in 2023:

The proposed distribution of results for 2022 to be made by the directors of the Company to the shareholders

is as follows:

Euros

Profit at 31 December 2022

14,254,857

Legal reserve

1,425,486

Voluntary reserve

175,412

Dividends

12,653,959

The proposed distribution of profits made by the directors of the Company to the General Shareholders'

Meeting entailed the distribution, as dividends charged to 2022 profits, of 2.84 euros per share. The gross

dividend for 2022 in the amount of 12,653,959 euros approved by the General Shareholders' Meeting on 27

April 2023 was paid in full on 24 May 2023.

Net financial debt: The Company has a net financial debt of 171,703,994 euros (137,685,955 euros at 31

December 2022). The breakdown of this debt is as follows:

Euros

31/12/2023

31/12/2022

José Abascal, 41

8,892,000

9,690,000

Titán, 13

8,896,495

9,708,654

Conde de Peñalver, 16

5,776,643

6,303,992

Valle de la Fuenfría, 3

7,274,621

7,763,333

Juan Ignacio Luca de Tena, 17

9,981,936

10,545,492

Glorieta de Cuatro Caminos 6 and 7

3,100,000

3,450,000

Arapiles 14

24,000,000

12,000,000

Hospital Valdebebas

16,196,400

Hotel Valdebebas

20,064,000

3,000,000

Mortgage-backed debt

104,182,095

62,461,471

Drawn down credit facilities

7,459,618

6,872,437

Long-term loans

74,167,916

70,413,976

Accrued opening costs

-293,439

-315,556

Interest accrued pending maturity

1,158,525

392,903

Derivative

-217,266

-314,056

Unsecured debt

82,275,354

77,049,705

Cash and bank

-4,753,455

-1,825,221

Pryconsa debt

-10,000,000

Net financial debt

171,703,994

137,685,955

At 31 December 2023, the Company had a mortgage debt of 104,182,095 euros pending maturity

(62,461,471 euros at 31 December 2022) recorded under the “Long-term debts with credit institutions” and

“Short-term debts with credit institutions” items and correspond mainly to mortgage-backed loans taken out

with several financial institutions, which, at 31 December 2023, are pending maturity and repayment.

The Company's LTV at 31 December 2023 was 23.25% (19.99% at year-end 2022).

Income: At 31 December 2023, the Company had obtained total income of 34,978,460 euros (30,707,329

euros at 31 December 2022). The breakdown of income per asset type is as follows:

Euros

Variation in %

Like for Like

31/12/2023

31/12/2022

Growth

Hotels

10,325,785

9,785,315

5.52%

Offices

15,207,228

11,352,483

33.96%

18.84%

Retail

9,445,448

9,569,532

-1.30%

-0.35%

Income

34,978,460

30,707,329

13.91%

8.20%

Lease income increased by 14% year on year (8% when disregarding the effect of investments and disposals

during the year).

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:

In relation to the average duration of the leases per type of property, the WAULT (Weighted average

unexpired lease term) are detailed below:

WAULT

31/12/2023

31/12/2022

Hotels

9.19

8.64

Offices

6.20

6.52

Retail

9.88

11.07

Institutional

10.00

Total Average

8.83

9.10

NOI: Net Operating Income was positive and amounted to 27,600,643 euros (25,554,818 euros at 31

December 2022), an increase of 8%. The breakdown of NOI per asset type is as follows:

Euros

Change

31/12/2023

31/12/2022

Hotels

9,087,130

8,679,451

Offices

11,779,745

8,846,859

33%

Retail

7,009,406

8,028,508

-13%

NOI

27,876,281

25,554,818

EBITDA at 31 December 2023 was positive and amounted to 27,035,871 euros (24,921,082 euros in

December 2022), a year-on-year increase of 8%.

Financial profit (loss): There was a financial loss of 2,537,749 euros at 31 December 2023 (loss of 4,587,688

euros in December 2022). The breakdown of this loss is as follows.

- The financial income derived from the system of financing to the group and external amounted to

641,590 euros (25,643 euros in December 2022).

- Dividends have been collected on the stock market investments held by the Company for the sum

of 671,387 euros (377,351 euros in 2022).

- The Company's financial expenses were 5,298,569 euros (2,073,585 euros in December 2022) and

arise from the Company's financing with credit institutions and the Group's financing system.

- The Company valued its portfolio of listed shares held in its assets at year-end, obtaining a positive

Euros

Nominal value

2023

2022

Less than a year

31,075,627

29,272,582

Between one and five years

119,670,583

87,953,936

More than five years

118,685,132

103,961,317

Total

269,431,342

221,187,835

value adjustment of 1,446,859 euros (negative value adjustment of 2,917,097 euros in 2022). In

addition, it has generated a profit of 985 euros from the sale of listed financial assets.

At 31 December 2023, EBITDA was positive and amounted to 24,498,122 euros (20,333,394 euros at

December 2022), a year-on-year increase of 20%.

Depreciation: Depreciation expense was 6,436,901 euros (5,986,123 euros for the same period the previous

year). The increase of 8% results from the new investments made during 2023 and 2022.

Subsidies: Subsidy income stood at 56,351 euros (56,351 euros in December 2022).

Impairment/Reversal:

- After the valuation of the Company's real estate assets, impairment of 344,990 euros has been

recorded, linked to the Hotels and Commercial segment, in addition to reversals of impairment of

236,381 euros, particularly in the Commercial Segment. The net impact on the income statement

for 2023 was therefore negative in the amount of 108,609 euros (negative 478,996 euros in 2022).

Profit/(loss) on disposal of real estate assets: During 2023, the following divestments were recorded:

- Sale of several properties with their corresponding annexes in Vallecas Comercial I (1 unit),

Sanchinarro VII (1 unit) and Coslada III (1 unit) for a gross cost of 534,383 euros, which were sold

to third parties. These sales transactions gave rise to a combined net gain of 67,715 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 2023.

- On 31 July 2023, the resulting Urban Plot PR-4, belonging to the San Blas district of Madrid,

included in the API 20.12 Julián Camarillo Sur of the General Plan of Madrid -1997-, was sold. A

tertiary commercial building has been built on this plot, located at calle Albalá number 7, which has

been disposed of for a gross book cost of 2,873,300 euros. This divestment gave rise to a net gain

of 2,395,995 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 2023.

At 31 December 2023, EBT is positive and amounts to 20,467,557 euros (14,254,857 euros in December

2022), i.e. a 44% increase year-on-year.

Net profit/(loss): At 31 December 2023, net profit of 20,063,539 euros (14,254,857 euros at 31 December

2022), representing a net profit per share of 4.51 euros (3.20 euros at December 2022), i.e. a 41% increase

year-on-year.

2. Valuation of real estate assets

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

which was issued on 31 January 2024, 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).

Said valuations generated a net loss in the Company's income statement at 31 December 2023 amounting

to 108,609 euros (478,996 euros in 2022).

Furthermore, based on the valuations performed, the fair value of property investments shows an

unrecognised gain (by comparison between the gross updated market fair value and the net carrying value)

of 247,439,373 euros (241,849,266 at 31 December 2022) considering in both figures the current residual

value of the two buildings under construction in Valdebebas (hotel and hospital).

The gross market value of property investments (considering the H.E.T. or “completed building assumption”

in the case of the two ongoing Valdebebas projects) at 2023 year-end amounted to 795,908,004 euros

(774,460,463 euros at 2022 year-end). The breakdown by business segment is as follows:

Gross market value of the

Property investments (Euros) (*)

31/12/2023

31/12/2022

Hotels (**)

211,158,528

204,000,000

Offices

304,822,198

285,681,522

Retail

205,927,278

211,478,941

Institutional (**)

74,000,000

73,300,000

Total

795,908,004

774,460,463

(*) The net market value at 31 December 2023 came to 774,013,880 euros ( 755,866,500 euros in 2022).

(**) 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 2023 amounts to 741,708,148 euros (2022: 680,358,044 euros), with a net value of 721,209,000

euros (2022: 664,116,641 euros). The estimated cost to be incurred in both projects until completion is as follows: Hotel (18,598,844 euros)

and Hospital (29,828,505 euros).

3. Segmented reporting

The Company identifies its operating segments based on internal reports which are the bases for regular

reviews, discussion and assessment by the Directors of the Company, since they are the highest decision-

making authority with the power to allocate resources to the segments and assess their performance.

The segments identified in this way in 2023 are as follows:

- Hotels

- Offices

- Retail

- Others

The segment reporting shown below is based on the monthly reports drawn up by Management and is

generated by the same computer application used to obtain all the Company's accounting data. In this

regard, the Company does not report its assets and liabilities in a segmented way, since this information is

not required by the Company's Management for the purposes of the management reports it uses for its

decision making.

Ordinary income corresponds to income directly attributable to the segment plus a relevant proportion of

the Company's general income that can be attributed to it using fair rules of distribution.

Segment expenses are calculated as the directly attributable expenses incurred in the operating activities,

plus the corresponding proportion of the expenses that can be reasonably allocated to the segment.

Segmented income statement

2023

Euros

Hotels

Offices

Retail

Others

Total

Income

10,325,785

15,207,228

9,445,448

34,978,460

Indirect costs

-1,238,655

-3,427,483

-2,436,042

-7,102,179

Net Margin

9,087,130

11,779,745

7,009,406

27,876,281

General expenses

-248,092

-365,376

-226,941

-840,410

EBITDA

8,839,037

11,414,369

6,782,465

27,035,871

% of income

85.60%

75.06%

71.81%

77.29%

Depreciation

-2,288,731

-3,020,644

-1,112,065

-15,460

-6,436,901

Subsidies

56,351

Extraordinary profits (losses)

4,585

Profit/(loss) on disposal of real estate assets

2,463,710

Impairment/Reversal of trade operations

-9,701

Impairment/Reversal of real estate assets

-198,538

89,929

-108,609

Financial profit (loss)

-2,505,699

-294,890

262,839

-2,537,749

EBT

6,412,704

8,351,736

5,465,440

237,678

20,467,557

Corporation tax

-404,018

Net profit (loss)

6,412,704

8,351,736

5,465,440

-166,340

20,063,539

% of income

62.10%

54.92%

57.86%

57.36%

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

172

-20,593

Profit/(loss) on disposal of real estate assets

350,824

Impairment/Reversal of real estate assets

-478,996

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%

46.42%

The breakdown of the income and net book value of real estate assets, including property, plant and

equipment in progress, at 31 December 2023 and 31 December 2022 is as follows:

Euros

31/12/2023

31/12/2022

Income

Net cost

Income

Net cost

Hotels

10,325,785

30%

135,536,452

9,785,315

32%

117,556,061

Offices

15,207,228

43%

228,032,522

11,352,483

37%

209,919,449

Retail

9,445,448

27%

99,476,270

9,569,532

31%

96,818,388

Institutional

31,223,531

14,214,881

Total

34,978,460

100%

494,268,775

30,707,329

100%

438,508,778

The breakdown of contribution to income from a geographic standpoint is as follows:

Euros

31/12/2023

31/12/2022

Income

Madrid

26,283,435

75%

22,306,777

73%

Huelva

8,695,025

25%

8,400,553

27%

Total

34,978,460

100%

30,707,329

100%

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

2023 amounted to 83% of the floor space (sq.m.) leased (92% in 2022), which breaks down as follows:

31/12/2023

31/12/2022

Occupation

Hotels

99,408

100%

99,408

100%

Offices

76,277

71%

62,406

95%

Retail

40,030

59%

40,852

62%

Institutional

19,273

100%

19,273

100%

Total

234,987

83%

221,938

92%

During 2023, the occupancy rate of the properties was reduced by 8 points compared to that of 31 December

2022, mainly due to the start of work on the Sexta Avenida shopping centre, which led to the closure of the

shops until the next opening.

4. Property Investment

Due to the recent reduction in expected yields in prime areas, the Company is seeking new diversified

medium and long-term investment opportunities that would allow it to combine high yields in sectors where

it is not currently present with yields of around 5% and 6%, and top-quality tenants, as well as some added

value real estate asset transformation operations for subsequent operation under a leasing scheme. The

Company will maintain the income it currently expects to obtain from the lease agreements that are now in

force.

In view of the Company's activity with long-term rental property assets, the Directors' forecasts are positive

given the long-term agreements with top-level tenants in both the hotel and office, retail and institutional

sectors, which guarantee the medium-term viability of the Company, together with new retail property lease

contracts with tenants with good credit ratings.

5. Disclosure on supplier payment deferrals