Merlin Properties SOCIMI S A : Marco de Referencia de Financiación Verde 2024

Green

Financing

Framework

April 2024

MERLIN Properties

About

MERLIN

Properties

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MERLIN Properties

is the leading REIT in the Iberian real estate market.

2024 Green Financing Framework

The Company benefits from a robust and diversified asset portfolio, comprising 3.2 million sqm of gross lettable area including offices, logistics warehouses, shopping centers and data centers in prime locations throughout Spain and Portugal.

MERLIN's strategy is focused in generating a sustainable return for shareholders through the acquisition, management and selective rotation of real estate assets.

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MERLIN Properties

Table

of contents

1. Introduction 6

2. ESG Strategy 10

3. Rationale 26

1. Green Financing Framework 28
2. Appendix 1 40
3. Appendix 2 42
4. Disclaimer 46

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2024 Green Financing Framework

MERLIN Properties

at the forefront of ESG

Well grounded pillars...

• Leading Spanish and Portuguese REIT and among the top 10 European REITS.
• A clearly defined strategy inspired by the best REIT Practices
• Best in class ESG initiatives.

€11.3bn portfolio:	92.8% of the
55.8% Offices.	portfolio located in Spain
and 7.2% in Portugal.
16.9% Logistics.
18.1% Shopping Centers.	171 ASSETS (+6.2%
6.2% Others.	vs 2022) LEED/ BREEAM
3.0% Data Centers.	certified.

Certification program

LEED and BREEAM completed.

85% reduction in greenhouse gas emissions between 2018 and 2028.

…that enables us to thrive

• Sustainability at the core of our business.
• 100% Green Bond portfolio.
• Dedicating fulltime resources in analyzing the portfolio each year in order to be eligible.
• Aligning our different ESG initiatives in a well calculated and planned Pathway to Net Zero

Top-notch scorings

Inclusion for

3rd year in a row in the Europe DJSI +1st time in the Word DJSI.

83%

Average peers:

69%

MERLIN

A-

Average score

B B C

Financial Europe Global

servicesaverage

69%

Average sector:

37%

7.2

Top 1% (negligible risk).

# 1

IBEX-35

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MERLIN Properties

1. Introduction

MERLIN's purpose

Following the 2.0ºC pledge made at the COP21 Convention on Climate Change in Paris, we announced our commitment to become a net zero carbon business by 2030, aligned with the SDG goals set by the United Nations (UN), which

will be validated by Science Based Targets (SBTi). MERLIN has joined to the Task Force on Climate-related Financial Disclosures (TCFD) to improve and increase reporting of climate-related financial information.

Fast FactsOur strategy

221	€11.3bn	Mid-term
Assets	GAV	construction program
		completed
€476m	96.2%	(240MW)
50%
GRI in 2023	occupancy rate	Digital (2)
(+5.0% vs 2022)	(+110 bps vs 2022)

0.001 tCO2eq/sqm

GHG emissions

(scope 1 & 2)

5.1%	3.2 years
Gross Yield	in Wault

Delivery of 3 data centers.

50%

Traditional (1)

1. Offices + Shopping centers.
2. Data centers + e-commerce related logistics.

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2024 Green Financing Framework

It is an ambitious strategy with clear actions to support the world to limit global warming to 1.5ºC. We have set highly challenging targets focused on reducing the embodied and operational emissions across our portfolio.

Our targets build on the strong progress we have made since incorporation. During this time, we have significantly reduced landlord carbon intensity across our portfolio from

a 2018 baseline.

Capital structure

Long-term + pipeline

25%

Traditional

75%

Digital

€7,083m	€15.08
EPRA NTA	PER SHARE
35%
LTV in 2023

5.1 years

average debt maturity

2.38%

av. interest rate

BBB+ Stable

Baa2 Positive

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MERLIN Properties

The Group operates

in four key strategic areas:

• Internal portfolio management: MERLIN is committed to internalising the management of its properties by a first-classteam with extensive experience in the real estate
  sector. In doing so, the Company is able to maximise the operational efficiency and profitability of each asset in all stages of the life cycle.
• Profitability through asset refurbishment: MERLIN strives to realise the full potential of each asset through refurbishment, maximising the value of the portfolio and generating higher returns for shareholders.
• Entry in a new asset class: data centers.
• Sustainability, a key aspect of the assets: MERLIN continues to aspire to the highest levels of sustainability and efficiency in its portfolio. It does so by integrating sustainability into the entire life cycle of the asset and supporting this commitment by obtaining
  the highest level of sustainability certifications.

MERLIN'S commitment

to sustainable management:

MERLIN manages its activities responsibly, ensuring the sustainable achievement of long-term objectives and the generation of shared value for its stakeholders. This practice is based on strict compliance with current legislation and adherence to international benchmark standards, reflecting its commitment to operational excellence and corporate responsibility.

In this context, MERLIN's primary commitment is to achieve sustainable profitability to ensure the success of its business project, taking into account the expectations of its stakeholders.

In addition, growth is sought that does not harm the environmental performance of the organisation, minimising any impact on the environment. The integration of sustainability into asset development and repositioning processes is prioritised as a core strategy.

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MERLIN Properties

2.

ESG Strategy

2.1.

Track Record

2016

• Launch of the certification programs with LEED and BREEAM.
• Marineda obtains
  the DIGA Accessibility
  Certificate.

2018 Baseline

• Obtained first LEED v4 certification in San Fernando I.
• Launch of the Photovoltaic Plan (Project Sun).

38% (1)		45%		61%		75%

2017

• First LEED Platinum certification obtained in a logistics warehouse in Spain.
• More than 88,000 certified sqm in ISO 50001 certification.

2019

• Supply of renewable electricity in 84%
  of multi-tenant office assets.
• Launch of Electric Vehicle charging points program.
• Sustainable financing with a €1.6bn ESG linked.

1 % of GAV portfolio certified by LEED or BREEAM.

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