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DES GB2013 E

Profitable portfolio with a stable value Deutsche EuroShop AG holds a balanced, diversified port- folio of shopping centers in Germany and other parts of Europe. We focus our investment activities on prime loca- tions in cities with a catchment area of at least 300,000 residents in order to guarantee a sustained high level of investment security. Seize opportunities, maximise value In line with our buy and hold strategy, we consistently place greater importance on the quality and yield of our shopping centers than on our portfolio’s rate of growth. We monitor the market continuously and act as buyers when an opportunity arises. Short decision-making chan- nels and considerable flexibility in terms of potential in- vestment and financing structures enable us to adapt to any competitive situation. At the same time, we are com- mitted to optimising the value of our portfolio’s existing properties. Objectives and strategy Corporate governance focuses on investments in high-qual- ity shopping centers in city centres and well-established lo- cations that have the potential to appreciate steadily over time. Another important investment objective is to generate high surplus liquidity from long-term leases of shopping center space which can then be distributed to shareholders in the form of annual dividends. To achieve these objectives, the Company diversifies its risk by investing in shopping centers in a number of European regions; the main focus is on Germany. Indexed, revenue-based commercial rents guarantee the desired high return. The Company invests in shopping center project develop- ments at an early stage and can invest up to 10 percent of its equity as part of joint ventures. Financing for new investments should be balanced, and the Group’s long-term debt-to-equity ratio must not exceed 55%. When taking out or extending loans, interest rates must be locked in for an extended period of time with the goal of keeping the duration (average fixed interest period) at over five years. Declaration on Corporate Governance Deutsche EuroShop AG is a transparent company that operates in accordance with a strategy geared towards long-term success. This focus on permanence is a key aspect of our corporate culture. We strive to promote the trust of investors, creditors, staff, business part- ners and the public in the leadership and supervision of our Company on the basis of legal and company-specific conditions governing the management of a listed company. This goal is consistent with the ob- jectives of a demanding corporate governance system. In conformity with section 3.10 of the Deutscher Corporate Governance Kodex (Ger- man Corporate Governance Code) as well as section 289a (1) of the Handelsgesetzbuch (HGB – German Commercial Code), this declara- tion contains a report by the Executive Board, also on behalf of the Supervisory Board, on corporate governance. DEUTSCHEEUROSHOPGESCHÄFTSBERICHT2013/INVESTORRELATIONS 112 O

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