Thank you, Sarah. Welcome, everyone, to our analyst and investor call for the full year 2025.

This is Janina speaking, and I am pleased to have our CEO, Asoka Wöhrmann, and our CFO, Martin Praum, with us today. Asoka will start by presenting the highlights of the year 2025.

Afterwards, Martin will guide you through our preliminary financial results for 2025 and provide an outlook for 2026. As mentioned by Sarah, the call will be followed by a Q&A session.

During today's call, we refer to our results presentation, which you can find on our website. If you have any questions, the IR team is more than happy to assist.

As usual, this call will be recorded and made available on our website afterwards. We will also provide a call transcript for further reference.

With that, I'd like to hand over to Asoka to start the presentation. Asoka, the floor is yours.

Thank you, Janina. Dear ladies and gentlemen, a warm welcome from my side as well.

Let's start on a page 3 of the presentation. Our world is changing rapidly, and uncertainty, volatility is the new geopolitical normal.

The old world order based on the rule of law, open societies, and free trade are facing an existential threat. The new emerging world order is dominated by three major powers.

The use of political and economic power to pursue national interests on a global scale is part of the new normal, and military conflict is back also on the agenda. In the light of the current global turbulences, investors are looking for safe havens of stability to protect their investments for the long term.

We believe this is the right moment in the new cycle to invest in real assets in the right geographies. Why is that?

Real asset investments offer strong long-term returns, and they are also an inflation hedge, provide stable cash flows, while other asset classes are impacted by increased uncertainties. In this environment, the attractiveness of Europe as an investment destination becomes even more apparent.

In addition, the stability of the euro supports investment performance for international capital. We believe this is the moment for Europe's awakening.

Europe is a beacon of stability, offers unique investment opportunities. We, PATRIZIA, are well-positioned to capture this shift, with deep expertise, strong local presence, and proven track record and proven execution across resilient European real asset markets.

That said, let's move to the next slide and take a look back at 2025. First, let's talk about the market in 2025.

After a weaker than expected 2025, we see that a new cycle has started. We believe this cycle is different to previous cycles.

It will be a longer, slower, and bumpier. Despite the current geopolitical turbulences, we are more optimistic than in previous years about the real asset industry.

Market sentiment is already improving. Investors are becoming more optimistic.

We see signs of stabilization with slightly improving valuations. Thus, we expect this recovery to gain stronger momentum in 2026.

PATRIZIA remains well-positioned for long-term growth, driven by the dual megatrends. These megatrends—digitalization, urbanization, energy transition, and living transition—continue to shape our economies and societies, and we will continue to invest along the dual megatrends in 2026 and in the future.

The creation of PATRIZIA's integrated investment platform, combined with strict cost discipline, has made our business more resilient and less dependent on market-driven revenue streams, and you can see this very well in our earnings performance. Our profitability has significantly improved compared to last year.

Importantly, this reflects a structural setup or step-up in our earnings profile. In 2025, our management fees fully covered by operating expenses for the first time.

This means we can turn the market momentum into even stronger profitability in the new cycle, and this is an important step to strengthen our long-term profitability beyond 2026. We are seeing a clear upward trend in fundraising, with higher equity raised in 2025 than in the prior two years.

This demonstrates the growing investor appetite, renewed confidence in PATRIZIA's product offering and market position. Investment volumes gain momentum, reflecting a clear acceleration in transaction activity.

This was fueled by our international business activities, underlying PATRIZIA's global footprint across real estate and infrastructure. With that, let's move on to the next slide.

Let me briefly comment on our results for the financial year 2025, which we already published yesterday evening after markets closed. We significantly improved our EBITDA by 35% up to €63 million.

We also improved our EBITDA margin to close to 23%, well above last year's margin. Our earnings performance is a result of efficient operations, strict cost discipline, and a stable portfolio.

Our AUM remained almost stable at €56 billion, despite a slower and weaker market recovery and currency headwinds. On the positive side, we saw valuations improving gradually during the year.

Let me now turn to our investment activity on the next slide. We already saw a small but encouraging increase in transaction activity in the second half of 2025.

We signed more transactions and we also closed more transactions compared to last year, and PATRIZIA continued to be a clear net buyer in the market. We expect this positive momentum to continue in 2026.

Valuations continue to improve, transaction volumes are increasing. More clients are taking advantage of market opportunities in the new cycle, especially in real estate, and we believe this is the right moment to start investing in real estate again.

That said, let me turn to our fundraising activity on the next slide. The increase of 22% in our equity raised compared to fiscal year 2024 shows the strong demand for real estate, especially in modern living, but also in infrastructure, and our multi-manager platform, AIP, contributed to this positive development.

The progress we are seeing in fundraising clearly support our long-term growth ambition. We continue to see strong demand for our dual-aligned investment strategies, particularly across our flagship products.

Building on the progress we have seen in 2025, let me now turn to the market outlook for the coming year. Looking at the market sentiment for 2026, we see clear signs of improvement.

Interest rates are expected to remain stable or trend lower. Inflation is also expected to stabilize.

As we can see again, geopolitical uncertainty remains a factor and will impact investment sentiment in different regions in a different way. Overall, this environment is expected to create structural tailwinds for us as PATRIZIA.

The positive market development should lead to a higher equity raised and increased investment volumes. We continue to focus on targeted investment solutions across our key strategies: living, value add, and infrastructure.

Living has been a strategic growth pillar for PATRIZIA for more than 40 years. We have an exceptional track record in living, both in our home market Germany, but also across Europe and recently also in Japan.

Living will be a key investment focus for PATRIZIA in the new cycle, as valuations improve and offer attractive long-term returns for our clients. As we all know, housing, especially affordable housing, is one of the most pressing challenges in our societies today.

More than 23 households in Europe spent over 40% of their disposable income on housing and energy. This challenge is also an opportunity, and PATRIZIA wants to become a leading impact investor in Europe.

We are currently building affordable homes for 7,500 people in Ireland, in the UK, Spain, and Belgium. Our ambition is to provide affordable housing for 40,000 people in the next couple of years across Europe.

Likewise, infrastructure remains a key investment focus for PATRIZIA in Europe and in Asia Pacific. Overall, we are well-positioned to capture the opportunities in the new cycle.

Thank you for your attention. I would now like to hand over to our CFO, Martin Praum.

He will guide you through the fiscal year 2025 results and our outlook for 2026. Martin, please.

Thank you, Asoka, and welcome also from my side. Let's continue on page 10 of the presentation.

Let's have a look at the AUM development in 2025. As Asoka mentioned, a virtually stable development.

We've seen some good inflows in 2025, both in real estate and in infrastructure. As Asoka mentioned, we've seen an increased transaction volume in the market and at PATRIZIA, with inflows, but also portfolio rotations and realizations.

This is a typical pattern for a market that recovers. It's time for asset allocation updates of our clients in the new cycle as the markets open up.

We've seen valuation effects now turning slightly positive. This is also a sign for a market stabilization and improvement.

The real drag for our AUM this year were currency effects with -0.7, leading to the AUM of round about €56 billion. Looking forward at the same time, we still have open equity commitments that are available for investments of around €1.3 billion waiting to be deployed in the market.

Let's continue on page 11 with the EBITDA composition. Key message here is we've seen a strong increase in EBITDA to €63 million, up 35%.

We've seen growth in management fees, but market-driven revenues, like transaction fees and performance fees, were still down year on year, having bottomed out in this market cycle. Overall, total service fee income down 2% year on year.

At the same time, our balance sheet investments had a higher return and had a higher contribution to our results. If you look at other income, then this has materially decreased to last year and is a reflection of a better earnings quality that we are delivering.

Now, if we look at total service fee income, around 90% of total service fee income and from fees are coming from recurring management fees. Let's move on to page 12 with a little more details.

I already talked about the management fee development. Transaction fees are still down because if you look at the transaction volume that we delivered, only a slight percentage of these transactions had a transaction fee arrangement attached.

This is why the higher transaction volume did not had an impact on the transaction fees. Performance fees are also slightly down year on year, but this was in line with management's expectations.

Let's have a look at the cost side on page 13. That we actively adapted to the changed market environment over the last 3 years, and we intensified our cost efficiency measures, which led to a significant improvement of the cost side.

We see total costs down 10% year on year to around €225 million, both driven by staff costs and other operating expenses. Now what have we achieved?

We've made the platform more resilient to market cycles, and we've increased the operating leverage once revenues come back in a more pronounced way. As an example of what this leads to, let's go to the next page on page 14.

Here you'll see the split of management fees versus operating expenses. Key message here is that management fees alone, for the first time, more than cover operating expenses.

We've shown growth in EBITDA despite being at the bottom of the market in transaction and performance fees. Coming back, management fees as a most recurring item more than fully covering expenses.

This is a very good starting point for the next cycle, and we think we're well-positioned for growth in the new cycle, given we have a better resilience and we have a better scalability of the platform, increasing the operational leverage once revenues come back. Let's have a look at our segment reporting on the next page, on page 15.

You might remember, we describe PATRIZIA as a two-engine model: on the one hand, the asset-light investment management business, and our balance sheet investments that we have deployed in strategic co-investments and seed investments. The asset-light part is up 29% in terms of EBITDA, again driven by better efficiency of the platform.

Balance sheet investments are slightly down year on year, but last year we had an extraordinary positive effect, underlyingly also balance sheet investments have improved their contribution to our results. Consolidation and other effects are down materially year on year, the negative effect has become smaller, and this drives the overall 35% increase in EBITDA for PATRIZIA Group.

Let's have a closer look at our balance sheet investments on page 16. I think you are familiar with that graph showing our invested capital at cost and at fair value, and the value that we have created over time with our balance sheet investments.

We have used the market opportunity to also invest more in the real estate living sector and also in infrastructure in 2025. The positive long-term returns that are primarily driving the invested capital are certainly driven by living exposure that we have.

At the same time, we've seen, for a change, positive valuation effects also on our balance sheet investments in 2025, again a confirmation that the market is stabilizing and changing. If we now focus on the right pillar and the fair value capital of our real estate of around €783 million, around 40% of that pillar are profit entitlements, or you could call them exit carry entitlements, which we will harvest step by step in the next years.

This will support our cash inflow by around €50 million per annum, and it's a sign that we actually crystallize the value that was created over the last 2 years to the benefit also of shareholders of the company. Let's have a look at the operating cash flow on page 17.

Also here, we've seen a significant improvement to last year. The operating cash flow is more than four times the level we've seen in 2024.

This was driven, a, by a better general profitability; secondly, more active working capital management; and thirdly, the quality of our income, which had a lower level of non-cash items attached. The €57.6 million more than cover our dividend payout for last year, which is around €31 million.

Also, if we look at the dividend payout in terms of net income, we have a net income after minorities of €18 million this year. On that basis, the dividend is not yet fully covered, but we are on a clear path to have full coverage also on net income going forward.

Let's move on to page 18 of the presentation. Our own liquidity, our balance sheet liquidity, has improved year on year to now €175 million in total and €115 million as available liquidity.

The equity ratio was further strengthened to close to 74%. We continue to run a solid and strong balance sheet, and this will also be the backbone for our future activities.

Let's go to page 19 to look at the guidance for 2026. Asoka mentioned that the new cycle has started and it'll be slower and bumpier, but we see lots of signs for improvement and also lots of opportunities in the market.

While our people will work on growing equity raising, investments, and AUM, we will continue to work on the further improvement of processes, of efficiencies, and also the quality of EBITDA. Basically, we expect a moderate improvement in the operating environment in terms of revenues and continued cost efficiency, driving our EBITDA up to a range of €60 to €75 million.

This would also have a positive impact subsequently on the EBITDA margin. In terms of AUM, we expect an increase to a range of €55 to €60 billion.

Again, it is a relatively broad range, depending on valuations of assets, organic growth, but also, as we've experienced, on foreign exchange impact. Let's have a look at the dividend side of things on page 20.

We're proposing the eighth consecutive increase in dividends since we initiated payments in 2018. As I mentioned before, the dividend last year was covered 40% by net income.

That has increased now to 53% coverage, and we have a clear plan for full coverage going forward, with as a next step, based on our plans and guidance for this year, we would talk about, depending on tax rate, a coverage of over 70%. Don't forget, our operating cash flow is very, very strong.

We have a very solid balance sheet to cover the dividend. As a last statement, don't forget that this equals a dividend yield of around 4.6% at the moment, and we will continue to deliver on the dividend policy that we've set in the past.

With that, thank you for your attention, and now both Asoka and I are happy to take your questions.

Hello, everyone. Thanks for the presentation and thanks for taking my question.

I have a couple of questions and I would like to go through them one by one if I may, starting with the AUM. As far as I understood, you updated your AUM policy and now include also fee-generating commitments.

Firstly, could you elaborate a bit more on this idea? Secondly, do you also adjust the 2024 numbers accordingly?

Thank you, Philipp. What we did is we had a look at our AUM policy overall, and you might remember that our AUM policy should always be aligned to market standards and the INREV standard.

As part of that, we updated the policy and included, as many other players, the commitments where we already generate a fee. This had a positive €0.3 billion impact, and we have highlighted that here and will make that very transparent also in the annual report.

We have not adjusted the previous year number, but again, given we mentioned the €0.3 billion impact, you could adjust yourself in your model if you like.

Perfect. Thanks a lot for the clarification.

With regards to the AUM guidance, you mentioned earlier during the presentation that the investment market is, yeah, slightly increasing and the market dynamics are improving. That said, your AUM guidance includes a downside scenario.

What's, yeah, the scenario for this case? Is it the, yeah, macroeconomic upheaval we currently see or any other implications?

Thank you for the question, Philipp. It is actually just to cover for potential timing effects.

I mentioned before, we are in a market phase where you also see portfolio rotation, where also investors might realize some performance. At the same time, we also want to cover for foreign exchange impacts.

As we have seen, this had a relatively high impact on our AUM in 2025. Depending on AUM fluctuations, we just want to have a certain downside protection here in terms of the guidance range we're giving.

We would say you should focus on the midpoint. We expect further increase in equity raised in 2026.

We expect a modest increase in transaction activity. Organically, we are planning for growth in AUM.

Perfect. Does the 2026 outlook exclude or include potential currency impacts?

The current outlook excludes currency impacts, we didn't make any specific currency assumptions in the planning.

Perfect. Very, very helpful.

Then let's move on to the operating cash flow. Cash flow improved significantly, congrats to this development.

Just for my understanding, the crystallization of the roughly €50 million per annum Dawonia entitlement would further stabilize your operating cash flow in the coming years. Is that correct?

It is partially correct, Philipp, because it'll come into the cash flow in the investing part of the cash flow, not the operating cash flow.

Perfect. Thanks for the clarification.

Then my last one with regards to net sales revenue, they were driven by rental income from warehouse assets. Will those assets stay on your balance sheet throughout the current fiscal year, or do you have already concrete plans to transfer the entire assets or part of the assets into funds during the year?

No, if we look at the exposure we have here, we have assumed for the time being that they'll stay on the balance sheet for the year. If we see a market opening up in certain areas, there might be an exit earlier,

but

assume in your model that they'll stay until the end of 2026. Again, we'll see how the market develops.

Perfect. Very helpful.

Thanks a lot. Just one follow-up on the operating cash flow then.

You already mentioned the three pillars: improved net profit, working capital management, and other positive effects. Of the two last two, how much could also occur in 2026 of those positive effects?

Good question, Philipp. I think we've advanced already in our working capital management, but there's still some fruits to be harvested.

I would expect at least a positive effect in the single-digit million-euro area also in 2026 from more active working capital management.

Perfect. Thanks a lot.

Very, very helpful. All for my side.

Thanks. All the best.

Thank you.

Thanks.

Yes, thank you very much. Good afternoon.

I would be interested in your growth aspirations. Thank you for sharing the split of your 2025 fundraising with us.

Which asset classes do you expect to be strongest contributors to your growth this year? Will it be real estate or infrastructure again, or maybe AIP?

Look, thank you, Lars, for the question. Definitely, I can tell you, without any doubt, real estate will be the majority of assets will be generated this year along our expectations, because, as I outlined, affordable housing topic as well as value add living, it's the right macro moment for a long-term investors to harvest great returns.

Therefore, I do think definitely we are expecting this year living strategies to kick off, where we have the best, in my opinion, track records, not because we have the track records, but I do think that's the right moment for the investors, and that's the way we are advising also and have the conversations. Also, I think I can see, by the way, in logistics in real estate area, the last-mile logistics, this strategy will change.

There is logistics become very re-infra, what we are calling convergence of real estate infrastructure, because energy, how you building on logistics, the rooftop solar, battery techniques, charging stations, all that is, in my opinion, very much upcoming now in the demand of clients. I do think this is an area what I'm really expecting to grow.

Also, in my opinion, early signs that some value add investors are on the street are looking for, let me say that, value add opportunities in offices is not excludable. This year is the first time after 3.5 years, I would say, we can first time think, is there interest?

Then your question regarding infrastructure, I think, look, all the investment bills of this government bills, what they are now all announced, that will come down mostly for infrastructure first, except of affordable housing or let me say, the bottleneck in housing in our societies. I do think what we are seeing is all where we are today in the modern infrastructure.

Let me say, energy storage techniques or investments, rooftop sustainable energy, energy to waste, all these strategies will come up now beside the very heating topic of data center. As we entered last year into this consortium deal in the US-aligned data centers.

By the way, we already capitalized and has been sold to big asset manager and developer in the Middle East, very well get profited from that. I do think we are expecting also, especially, Lars, in Asia infrastructure to kick off.

I do think, especially last year, we can see we invested more than €300 million in Philippines with partners, co-investment partners. I do think I am very, very positive on infrastructure in Asia.

Also, our new fund strategy, Emerging Market Sustainable Infrastructure Strategy, what we are looking to place in Asia, capital raising around a first round. We have a promising not only deal pipeline, but also promising clients are coming in and have interest.

Therefore, let me say, if you ask me, Asoka, what is exactly the portions: 50% to 70% in real estate, 30% in infrastructure, might be 10% between a little bit out of the infrastructure, I would say we can phrase that as a re-infra area. This is little bit the storyline what we are seeing in Europe as well as in Asia.

Thank you very much. Crystal clear.

Then I can't withstand to ask the question. I think on the Q3 call, you said that illiquid assets would also look very attractive and that you would be happy to elaborate on that in one of the following calls.

Is today one of the following calls?

You ask the illiquid or liquid?

Illiquid.

Illiquid.

Illiquid, yeah.

Illiquid. We are in the illiquid.

I have to say that illiquid assets, I do think, to be honest, do you not feel all, we are all investors, the gold is performing unbelievably well as fears of market participants are coming to a level decrease and also the vol explosions in the market that people are going to protect themselves with this strategies? I think, to be honest, nothing is, let me say cash-generating, no return-generating.

It is the time, and also the correction from Bitcoins, all this digital currencies, this is a sign this areas are exhausted. I think gold will still get as a illiquid asset, by the way, illiquid asset for me, because you have not the illiquidity, you can trade it every day, but again, it's not interest rate-bearing, is not interest rate-generating.

I think, to be honest, if you have a stable, great in valuations, if you buy it today into real estate or infrastructure as a long-term investments, you had a fantastic returns front of view. I would take this part as a diversifier.

My conviction for illiquids, even now, not last time only I discussed, it is already, I would say, if you're not already look into that, you should, and that's the way we are advising. We can see, by the way, more and more clients are looking into that.

I do think the geographies are not unimportant. Europe people feel undervalued.

Again, beside all the press releases talking down Europe, the unimportance of Europe compared to the three big players in the world, with China, US, and in some way, Russia and some other ones, but I have to say, I feel Europe is the right place to invest, Asia is the right place to play growth. This is, valuation-wise, it's a place to be, especially in the right sectors, and right place of growth and over-returns is Asia.

In my opinion, we are in the right geographies, and I do think I am very confident. That I've been long-time investor and CIO in my former career, I have a very strong conviction, Lars.

Hopefully, it is now it's the right time. It's a macro moment, what I'm saying.

This is a macro moment where most of our clients are shy sometimes to take risk. I do think this is the right time to take risk in illiquids.

Perfect. Thank you.

Then you indicated increasing transaction activity. I guess also listening to my real estate colleagues, it's something where momentum will build up over this year, right?

It's starting, but we should rather expect transactions to be a bit more back-end loaded this year.

No, you are right. I think the whole story of our industry is always back-ended.

I can't hear that anymore, and I'm not also giving to any excuse to also to us. Yes, last year was a disappointment, as Martin has already shown, we are transparent.

I think, as PATRIZIA has a fantastic transaction team around Europe and also in Asia in both asset classes. We can be, one point if you want, was a disappointment not because our people are bad, that was a really the market has not played with us.

You need a tango partner also in the market. Market were not the right tango partner for us, and I do think this year I can see sizes are increasing.

The great thing is, I feel that clients are asking, do you see now interesting transactions? Can you show us?

Is there any good risk-rewards you can show us? This is a good moment, in my opinion.

It's still slow, as we are saying this cycle is slower, bumpier, is a very different from the last time. There is no, let me say macroprudential policy supports in the sense of central banks are helping us.

It's more other way, but I do think this is what I'm seeing. I can see now the right time for all that to act, and we will see more transactions this year and also more, by the way, in real estate, because people, family offices, they're smaller tickets what I'm seeing, and then the big packages.

You need deep pockets and a strong conviction, and there's only very less players in the world can do these things. I can see that it's coming.

I'm confident.

Perfect. Thank you.

Then one last question if I may. With business momentum picking up slightly, and I love your picture of tango partners, what about new tango partners for you?

We haven't seen some bolt-on M&A from you recently. Is there anything in the pipeline in order to speed up your assets under management growth?

Let me say that I'm always said bold acquisitions are for lazy managers, we are not lazy.

I know. You say that all the time, yeah.

I'm saying that always, Lars. I do think, joke aside, I think PATRIZIA has grown fantastically before I came in.

Unbelievable, they flew over the cycle, even with a great cycle what we have seen, we grew so exceptionally well. This consolidation was needed, and consolidate our platforms, creating global platforms, creating efficiency, as Martin said, that was a hardworking of reorganization, platform building, all that.

We feel we are ready. Our core is stable.

If you think about our balance sheet position, if you think about our operating business, how that improving, I am not shy to say that's the time to look around to partnerships, not only acquisition, bolt-ons, and all that, it is also partnerships. The world is going to build by partnerships.

There's a big task there, and big profit pools can be shared. I do think from that, I'm super confident with our resilience what we have shown the last 3 years.

We've done our homework. We are showing what we, again, you guys can all, if you go back since what we are talking here, not promise too much, that we're doing our efficiency work, that we are doing the cost cutting, we're doing the reshaping, we're putting our product shelf in the right to win in this cycle.

All that is coming. We have a stable core now, resilient platform, great balance sheet.

We are ready for all things, not only to build partnerships, bolt-ons, all that. If that fitting to us is great.

What I'm not going to agree to with no one, not inside, outside, we are not buying because something is cheap and we are solving others problem, that they should solve their self. If that fitting to our strategy is something what we are missing, we feel there's growth in, we are there, and we are looking.

It is, and your question is absolutely right and relevant. Many, many transaction has been offered to us.

Good managers have to also say no inside and outside, and that's what we do.

Crystal clear. Thank you very much.

I'll go back into the line.

Thanks.

Hello?

Hello, can you hear me?

Hello, can you hear me?

We can hear.

Perfect. Okay.

Thanks. Manuel Martin from ODDO BHF.

Gentlemen, thank you for letting me ask some questions. I have two questions from my side if I may, please, maybe one by one.

The first question is, as far as I understand, real estate might be one of the preferred asset classes this year, especially living strategies. When it comes to offices, maybe they're in value add strategies, that could be something.

When it comes to offices, have you heard anything from your clients when it comes to the topic artificial intelligence and demand for office space, which might influence this asset class? Don't know if you have some insights to share here.

Yeah. I think, look, PATRIZIA has a really great portfolio in especially in Europe, not mostly, I can tell, that in Europe offices.

We ourselves, I don't know if you have the chance ever to visit us physically, we are creating over five years since before COVID, but also during the COVID and up to now, the real showcases how to invest in offices. We spent quite much money.

I want to invite you, for example, to visit also our London office in London in our international hub in London that just won, by the way, Prop Awards. Let me say that your AI question is a very valid one.

I would not say AI, but I think today there's a three things in offices are relevant beside now risk classes. It is important that you make your offices attractive for your employers.

This is relevant because the home office tendencies has killed the offices mostly if you think about US and New York and the big cities. Europe is also very much impacted.

The second, that has led to reduce offices because people only reduce to reduce space, to reduce costs. What we done, we upgrade our offices.

We are showing that our employees have a incentive to come over. There is a, more, let me say, not only a brutal desk, there's areas to sit together, communicate, to build kind of community within the offices.

I really invite you our Frankfurt office, soonly in Augsburg, and also in London especially, but also other places like Hamburg what we have in especially in Europe. Again, that is a one effect that has negatively impacted, but at the same time, and you have to give a answer to employer and give a incentive to come back to offices, that they like to work with, and that's a relevant, in my opinion.

You can command like in the US, the CEOs, we have also 3-2 rule, three days in the office, two days home, with agreement within your teams. Again, the same time, you can't command, you must give the incentive.

That's the first thing, and that means offices have to change in their conceptual setting. That's the one thing.

The second thing is in my view is especially the digital sphere, what you are saying. Today, the tech part is absolutely relevant.

We shown our that the London office won the Prop Award in 2025 in the UK as a best office building turning into office story that has really worked well. Tech played a key role there, key role.

I think this is relevant. AI is a something different for me.

AI is also now it's coming to our big decision-making spheres, but also back and middle offices. We are in the full of the process to use AI to become efficient, become modern, become time to market, make us better also in reporting and reporting standards for our clients.

This is helping us and to enrich our people. I think the efficiency win is something is front of us now all that.

I would say that's not necessarily combined with the offices, but I think offices will play absolutely a new story how they get structured. How and I think, by the way, the real factor is also ESG, the means the offices have to in the refurbishment have to follow special standards.

All that, it's why the office market you have to enter into a value add area, you can't, I think, to be honest, as a core asset is at the moment difficult. By the way, the last remark, you have to be in core centers of cities.

That's what we have mostly. If you are in the C areas, I think then the mixed-use is might be a option to come out of that, but that takes time, that takes resources, that reduce your returns at the beginning, and might be you are avoiding a stranded asset.

If I can add to that, Asoka. Hi, Manuel.

On the second what Asoka just said, I would say that AI will have the first real impact especially on process-driven work and on back-office work, and these are typically in secondary locations due to cost optimization and outsourcing. These locations will be impacted first.

The human intelligence and the decision-makers, the analytical part of our work, will want to continue to work in A locations in urban areas. In our view, AI will actually intensify the flight to quality to A locations in the office sector.

Sounds logical. Thanks for that insight.

Sounds really logical. My second question and last question would be on again on the clients and the macro environment.

In your opinion, what is holding back the clients, they're still a bit shy, as some people say? Is it that the prices are not yet at the correct level, or is it the interest rates, which is shaky?

What would be the start button in the sports car to let you drive again at high speed?

Na ja, is also great question. I think there's two, I think let me say also three factors.

First, don't forget before we are forgetting, and we are we are great market people, that's why we are always fascinated about markets and, but one thing we should not forget, before COVID or during the COVID, the first 1.5 years, we have seen extremely low or negative interest rates, and people have been exposed, overexposed, into illiquid to hunt a return, to, withstand the negative rates and have long-term returns. They've done, by the way, in this context, some late-cycle investments.

That is not playing out well for them, and they have to take a long breath, breathe on that to to to solve out of, they need solutions get out of their portfolio. The same time now, the the sudden, let me say that 2022-2023 is a sudden death of illiquids, as Lars, discussed earlier, I'm mentioning, I think there was a was a sudden death of illiquids.

People don't want to invest, and people want to go now all, more or less all their liquidity, the pension funds, the lifers, the also even sovereign wealth funds, they want to be in fixed income. They they are the most favorite asset class on the fixed income and and private credit.

Now, also the, inflation moderated, and I think, to be honest, also I would not, I would not, I would really if I look the the sovereign debt explosion in the world, all the AAA status, single As, and double As, I'm questioning this ballooning of debt, if that's sustainable. That means, by the way, that's the only good thing is that will lead us to a longer expectation or long-term expectation that the rates have to be very low, not to overburden the fiscals, fiscal budgets of states.

Saying that, fixed income was the most favorite asset class, still the favorite asset class, corporates, private debt, government bonds. There's other institutional factors in Europe.

I think, to be honest, the central banks and regulators, with the solvencies and all that, also our, we are mostly institutional clients, they have been in long-term bonds and that is under water. Their risk limits to go into illiquids also low.

Saying that all, at the moment, what is holding back, you're asking me. What they can't hold anymore back is, because I think they want to be at one day now real assets, they are seeing the attractive risk-returns in the value add and core plus, because at the moment, that is the easiest to say and that is nothing marketing, you get for core plus risk or, let me say, core plus risk, value add returns.

This is exactly what a asset manager like us have to deliver, asymmetric risk-return profiles. That is, by the way, has not existed earlier, this is now.

Also, I think if the office area also revalued stronger, I think US happened and it's still not settled 100%, Europe are all devaluations are happening slower, if that the certainty there, people will go with both hands into these areas. That's what I'm seeing, that is upcoming, starting with living, starting with with also, in my opinion, kind of logistics.

There's some retail portfolios underway in the market, all that giving you opportunities. In my view, let let us, we have, I am impatient in general, but I do think I have the conviction the metrics for illiquids are going to change over the next two years.

That's where my my hope is coming.

If I may add to that, Manuel, exactly what Asoka said. The market first had to digest the relative over-allocation of real estate at the peak of the cycle, then now the market has repriced.

The expectations, I think, have changed and the market becomes more transparent with more transaction volume. The world seemed brighter in many other areas than Europe for quite a while, and now we have a reallocation, a rotation back to Europe.

The refocus on generating cash flows, generating recurring income is also one thing that we think will drive investors and will kind of break up this situation where investors were hesitant to invest in real assets.

100%.

Okay. Where are we more or less, the digestion might still hold on a little bit and then maybe people can move more freely, or what do you think, where we are right now?

It's been a process really for 3, 4 years. That we haven't seen a V-shaped recovery in the market.

It was all slower and, as Asoka said, bumpier. When we talk to our clients, and simply we derive that from the feedback we get from our clients, they're more open to talk about real estate investments again.

They're more open to talk about infrastructure. For some of them, the regulatory environment has also eased and changed.

They have more flexibility to invest in infrastructure. All these, if you put all that together, are signs and are confirmed in the way we discuss with our clients that there's a regained interest in the sector.

If you need also in a picture again, we are not 5:00 in the investment clock, we at 7:00. We pass the 6:00.

Trough is behind us. That's important, and that's what long-term investors are seeing, and that's why they are earning money.

With this views are now coming more and more, and I do think Martin said a very important thing: the transaction makes the valuations visible, visible for investors. That gives the confidence also.

If you are doing in the fog transaction, you don't know it's that still 5:00 or 7:00. It's important.

Okay. I will try to put the clock in my office.

That's a good example. Okay.

Yeah.

Thank you, Manuel.

Thanks a lot, gentlemen.

Yes, thanks so much for your attention. Thanks so much for your very good questions.

We are very happy to continue the discussion both on IR team level and also during the next conferences that we have planned, for example, one in London, and then will be other venues where we have the ability to discuss our financials and the strategy. Stay healthy and speak soon.

Thank you, everyone.