Inovalis Real Estate Investment Trust : REIT Q1 2026 MD&A

Published on 05/12/2026 at 05:33 pm EDT

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INOVALIS REAL ESTATE INVESTMENT TRUST

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Management's

Discussion & Analysis

March 31, 2026

Q4 2021

Inovalis REIT

Contents

Letter to Unitholders 1

Highlights 2

Basis of Presentation 4

Forward-Looking Information 4

Non-GAAP Financial Measures and Other Measures 5

Market and Industry Data 6

Foreign Currency Environment 6

Outlook 7

Portfolio Overview 8

Occupancy and Leasing Activity 10

Lease Maturities 11

Discussion of Financial Performance 11

Non-GAAP Financial Measures and Other Measures 11

FFO and AFFO Calculation 14

Overview - GAAP and Non-GAAP 15

Consolidated Financial Information 16

Capital Management 21

Financial Instruments 26

Quarterly Information - Last Eight Quarters 29

Related party transactions 30

Investment in Joint Ventures, Reconciliation 31

Risks and Uncertainties 33

Critical Accounting Policies and Estimates 42

Disclosure Controls and Procedures and Internal Controls Over Financial Reporting 42

All amounts in the MD&A (as defined herein) are presented in thousands of Canadian dollars or Euros, except rental rates, per unit amounts or as otherwise stated. Information contained in this MD&A is based on information available to management as of

May 12, 2026.

‌Letter to Unitholders

The Canadian REIT sector is in the midst of a clear and ongoing shakeout. Recent take-private transactions involving First Capital REIT, Minto Apartment REIT and European Residential REIT are not isolated events, even though they are concentrated in the residential segment, which has remained comparatively resilient. These transactions nonetheless underscore a broader and persistent disconnect between public market valuations and underlying asset values across the REIT sector. While residential assets continue to attract strong private capital interest, other segments, particularly office, face more acute valuation pressure, weaker liquidity and fewer natural buyers. Across the sector, elevated interest rates and constrained access to equity capital are forcing public REITs into defensive actions by disposing of assets, reducing leverage and narrowing strategic focus. The result is an ongoing rationalization in which scale, liquidity and access to capital are increasingly determinative, while more challenged issuers face mounting pressure to pursue strategic alternatives.

Against this backdrop, Inovalis REIT has been actively executing its asset recycling strategy to address these same market realities. The sale of the Trio property on January 30, 2026, for $15,798 (€9,800) is illustrative: the REIT exited a non-core asset while securing a waiver from its senior lender of $17,020 (€10,600) of indebtedness that could not be repaid from the sale proceeds, resulting in a gain recognized in Q1 2026. This outcome underscores both the constraints in transaction markets and the importance of proactive lender engagement. Similarly, at Arcueil, the REIT has entered into an exchange contract for the sale of 87.5% of the property for $60,510 (€37,540), with closing targeted by year-end, subject to customary conditions including the issuance of a building permit. Marketing efforts continue for the remaining 12.5% office component.

Balance sheet management remains central in this environment. Over the past year, the REIT has taken deliberate steps to extend debt maturities, reposition financing at the asset level and reduce exposure to near-term refinancing risk, recognizing that access to capital

cannot be assumed. These actions have created the flexibility required to execute on asset sales and leasing initiatives from a position of greater control. The REIT ended this quarter with $20.1 million cash on hand, providing a meaningful liquidity buffer as it continues to navigate market volatility and advance its portfolio repositioning strategy.

We look forward to engaging directly with Unitholders at our Annual General Meeting on May 12, where members of the Board and management will be present to discuss the REIT's strategy, recent progress and priorities for the year ahead.

On behalf of the Board and management team, I thank you for your continued support and patience.

Stephane Amine

President and Chief Executive Officer Inovalis Real Estate Investment Trust

Q1 2026

Quarterly NRI

$(0.7)

Million

Adjusted NRI -

IFRIC 21

$1.5

Million

Total Portfolio Adjusted NRI -IFRIC 21

$4.1

Million

Available cash

$20.1

Million

‌Highlights Net Rental Income

For the portfolio that includes assets owned entirely by the REIT ("IP Portfolio"), Q1 2026 Net Rental Income ("NRI") was $739 (€460), compared to $155 (€103) NRI for Q1 2025. The decrease was primarily attributable to the sale of the Trio property in January 2026, which largely offset the positive contributions from the Sabliere and Baldi properties that were included in the IP portfolio during Q1 2025 prior to their dispositions in April and December 2025, respectively

In Q1 2026, Net Rental Income, adjusted for IFRIC 21 for the portfolio that includes the REIT's proportionate share in joint ventures ("Total Portfolio"), was $4,149 (€2,584), compared to $5,000 (€3,310) for Q1 2025, a decrease related to the same factors as for the IP Portfolio.

Leasing Operations

As of March 31, 2026, following the disposition of the Trio property (73% occupancy) at the end of January, the REIT's IP Portfolio occupancy was 39.3%, compared to 57% for the REIT's Total Portfolio. Strategic vacancy has been maintained in the Arcueil and Delizy properties in support of the dispositions which, for Arcueil, is currently under exchange contract as outlined in the Asset Recycling Plan. Excluding Arcueil and Delizy, the Total Portfolio occupancy rate was 83% at March 31, 2026.

During the fourth quarter of 2025, management signed a long-term extension of the main tenant's lease at the Metropolitain property bringing occupancy to 100%, effective February 2026. At the Gaia property, negotiations are advancing to secure a lease with a public hospital and medical center for approximately ten percent of the space in 2026.

Asset Recycling Plan

Arcueil is the remaining property in the Asset Recycling Plan. Management is progressing toward closing the sale before the end of the year which is

conditional to issuance of the building permit. The sale of 87.5% of the property for $60,345 (€37,540) is still evolving according to plans. Marketing efforts are ongoing for the remaining 12.5% interest in the property.

Refer to the "Portfolio Overview - Asset Recycling Plan" section of this MD&A for more detailed discussion.

Sale of the Trio Property

The REIT closed the disposition of the Trio property on January 30, 2026, for $15,797 (€9,800). Concurrently with the closing of the sale, the senior lender agreed to waive the $17,020 (€10,600) portion of its loan that could not be repaid from the proceeds of the sale, strengthening the REIT's overall financial position. The REIT incurred a

$517 (€322) loss on disposition representing sale costs, including $318 (€198) paid to related parties.

Capital Market Considerations

European real estate markets remain compressed, weighed down by persistent inflation pressure, structurally higher financing costs, and continued geopolitical uncertainty.

Unitholders' equity stood at $151,399 (€101,665) at March 31, 2026. Book value per Unit was $4.53 ($4.49 fully diluted). The TSX closing price of $0.86 per Unit reflects continued investor caution toward the office REIT sector and current capital market conditions.

In the current market, the REIT remains focused on balance sheet resilience. At March 31, 2026, debt to gross book value, net of cash, stood at 56.9% for the Total Portfolio and 46.4% for the IP Portfolio.

Management continues to evaluate capital allocation decisions through the lens of value per transaction and sustainable leverage reduction.

Liquidity and Capital Position

As at March 31, 2026, REIT's cash position was $20.1 million, reflecting proceeds from recent asset dispositions. Available liquidity is expected to be used to support senior debt service, including interest and

amortization, fund tenant improvements to advance leasing activity, and address tax-related obligations, subject to the outcome of an ongoing appeal.

In addition to this available cash, the REIT held $1,366 of restricted cash, which may be applied toward partial deleveraging in advance of loan extensions or upon property dispositions. The REIT also held $5,369 of cash within assets held in joint venture, including

$2,616 of restricted cash established in connection with debt refinancing and intended to support lender requirements, capital expenditures and leasing incentives.

Funds From Operations and Adjusted Funds From Operations1

Management has excluded from the Q1'26 FFO calculation the $17,020 non-recurring finance income obtained in relation to the Trio disposition. FFO and AFFO per Unit for Q1 2026 were nil, in line with the current occupancy level and borrowing costs.

Refer to the "Non-GAAP Financial Measures and Other Measures" section of this MD&A for a more detailed discussion on FFO and AFFO.

Financing Activity

The REIT is financed almost exclusively with asset-level, non-recourse financing with an average term to maturity of 1.9 years for the Total Portfolio (2.3 years for the IP Portfolio). In February 2026, Management obtained a six-month extension of the mortgage loans financing the Stuttgart, Neu-Isenburg and Kosching properties, held in joint-venture, now maturing in August 2026. Several maturities expire in the next 12 months following the reporting date, notably the Gaia, Delgado and Duisburg financing. Management is confident in obtaining an extension at maturity without massive deleverage.

For the three-month period ended March 31, 2026, the weighted average interest rate across the Total Portfolio was 3.30%. As at March 31, 2026, 63% of the REIT's Total Portfolio debt was subject to variable interest rates, primarily associated with short-term financing on properties currently being marketed for sale.

Environmental, Social and Governance (ESG)

Integration of ESG objectives and strategies into the REIT's business reflects the growing importance of these factors among many of our key stakeholders. The REIT is working to improve its long-term environmental performance, and also to invest in "human capital" for the implementation and monitoring of all ESG initiatives.

1. FFO and AFFO are non-GAAP measures. See the section "Non-GAAP Financial measures and Other Measures" for more information on the REIT's Non-GAAP financial measures. A reconciliation of FFO and AFFO to Net Income can be found under the "Non-GAAP Financial measures and Other Measures".

Management's Discussions and Analysis ‌Basis of Presentation

The following management's discussion and analysis ("MD&A") of the financial condition and results of operations of Inovalis Real Estate Investment Trust (the "REIT") should be read in conjunction with the REIT's unaudited condensed consolidated financial statements as at and for the three months ended March 31, 2026, and 2025, and the notes thereto, prepared in accordance with International Financial Reporting Standards ("IFRS") and notably with International Accounting Standards ("IAS") 34 : Interim Financial Reporting.

Dollar amounts in this MD&A are presented in thousands of Canadian dollars and Euros, except rental rates, per unit amounts or as otherwise stated. Historical results, including trends which might appear in this MD&A, should not be taken as indicative of future operations or results. See "Forward-Looking Information" for further details. Information contained in this MD&A, including forward-looking information, is based on information available to management as of May 12, 2026. Additional information about Inovalis REIT has been filed with applicable Canadian securities regulatory authorities and is available at https://www.sedarplus.ca.

‌Forward-Looking Information

Certain statements contained, or contained in documents incorporated by reference, in this MD&A constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to the REIT's future outlook and anticipated events or results and may include statements regarding the future financial position, distributions, business strategy, budgets, occupancy rates, rental rates, productivity, projected costs, capital investments, development and development opportunities, financial results, taxes, plans and objectives of or involving the REIT. Particularly, statements regarding the REIT's future results, performance, achievements, prospects, costs, opportunities, and financial outlook, including those relating to acquisition and capital investment strategies and the real estate industry generally, are forward-looking statements. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or the negative thereof, or other similar expressions concerning matters that are not historical facts. Forward-looking statements are based on certain factors and assumptions regarding expected growth, results of operations, performance, and business prospects and opportunities.

Although management believes that the expectations reflected in the forward-looking information are reasonable, no assurance can be given that these expectations will prove to be correct, and since forward-looking information inherently involves risks and uncertainties, undue reliance should not be placed on such information.

Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such forward-looking statements. The estimates and assumptions, which may prove to be incorrect, include, but are not limited to, the various assumptions set forth in this document as well as the following:

the ability to complete the sale of the Arcueil;
the ability to continue to receive financing on acceptable terms;
the future level of indebtedness and the REIT's future growth potential will remain consistent with current expectations;
there will be no changes to tax laws adversely affecting the REIT's financing capability, operations, activities, or structure;
the REIT will retain and continue to attract qualified and knowledgeable personnel to manage the portfolio and business;
the impact of the current economic and political climate and the current global financial conditions on operations, including the REIT's financing capability and asset value, will remain consistent with current expectations;
there will be no material changes to government and environmental regulations that could adversely affect operations;
conditions in the international and, in particular, the French, German, Spanish and other European real estate markets, including competition for acquisitions and the market for dispositions, will be consistent with past conditions; and
the demand for the REIT's properties and global supply chains and economic activity in general.

The REIT cautions that this list of assumptions is not exhaustive. Although the forward-looking statements contained in this MD&A are based upon assumptions that management believes are reasonable based on information currently available to management, there can be no assurance that actual results will be consistent with these forward-looking statements.

When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties. Forward-looking statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not, or the times at or by which, such performance or results will be achieved. A number of factors could cause actual results to differ, possibly materially, from the results discussed in the forward-looking statements, including, but not limited to:

the REIT's ability to execute its asset recycling, and capital deployment strategies;
the impact of changing conditions in the European office market;
the marketability and value of the REIT's portfolio;
changes in the attitudes, financial condition and demand in the REIT's demographic markets;
the political environment in the REIT's demographic markets;
fluctuation in interest rates and volatility in financial markets;
the geopolitical conflicts around the world on the REIT's business, operations and financial results;
general economic conditions, including any continuation or intensification of the current economic conditions;
developments and changes in applicable laws and regulations; and
such other factors discussed under "Risk and Uncertainties'' in this MD&A.

If any risks or uncertainties with respect to the above materialize, or if the opinions, estimates or assumptions underlying the forward- looking statements prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking statements. The opinions, estimates or assumptions referred to above and described in greater detail under "Risks and Uncertainties'' should be considered carefully by readers. Although management has attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other risk factors not presently known or that management believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking statements.

Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Certain statements included in this MD&A may be considered a financial outlook'' for purposes of applicable Canadian securities laws, and as such, the financial outlook may not be appropriate for purposes other than this MD&A. All forward-looking statements are based only on information currently available to the REIT and are made as of the date of this MD&A. Except as expressly required by applicable Canadian securities law, the REIT assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All forward-looking statements in this MD&A are qualified by these cautionary statements.

‌Non-GAAP Financial Measures and Other Measures

These measures have been derived from the REIT's financial statements and applied on a consistent basis as appropriate. Management includes these measures as they represent key performance indicators to management, and it believes certain investors use these measures as a means of assessing relative financial performance. These measures, as computed by the REIT, may differ from similar computations as reported by other entities and, accordingly, may not be comparable to other such entities. These measures should not be considered in isolation or used as a substitute for other measures of performance prepared in accordance with IFRS. Additional information regarding these non-GAAP measures, including definitions and reconciliations to the most directly comparable GAAP figure, where applicable, can found in the section "Discussion of Financial Performance - Non-GAAP Financial Measures and Other Measures" in this MD&A.

‌Market and Industry Data

This MD&A includes market and industry data and forecasts that were obtained from third-party sources, industry publications and publicly available information, as well as industry data prepared by Inovalis S.A. based on its knowledge of the commercial real estate industry (including Inovalis S.A. estimates and assumptions relating to the industry based on that knowledge). Inovalis S.A.'s management has knowledge of the real estate industry developed through its 30 plus years of experience and participation in the industry.

Business Overview and Strategy

The REIT is an unincorporated open-ended real estate investment trust governed by the laws of the Province of Ontario. The REIT was founded and sponsored by Inovalis S.A, the asset manager. The Units have been listed on the Toronto Stock Exchange under the trading symbol INO.UN since April 10, 2013. The head and registered office of the REIT is located at 151 Yonge Street, 11th floor, Toronto, Ontario, M5C 2W7.

The REIT's objectives are to:

Manage a portfolio of income producing office properties in France, Germany and Spain;
Strengthen financial resilience through disciplined asset recycling, cost reductions, and liquidity preservation ; and
Selectively monetize opportunities where fair value can be achieved, while prioritizing leasing and income stability.
The REIT's investment criteria encompass office properties outside of Canada with an occupancy level above 80% (unless AFFO accretive), secured rental cash flows, a property value between €20,000 to €60,000 (unless AFFO accretive) and potential future upside with respect to matters including rent and area development.
‌Foreign Currency Environment
The REIT's current asset base is located in France, Germany and Spain. Items included in the financial statements of each of the REIT's entities are measured using the currency of the primary economic environment in which the entity operates (the "functional currency"). The functional currency of the REIT's subsidiaries and joint ventures is the Euro, whereas the functional currency of the REIT, as well as its presentation currency, is the Canadian dollar. As such, although the REIT's main assets and liabilities are denominated in Euros, the REIT's financial results are translated into Canadian dollars for presentation purposes as follows:
- Assets and liabilities are converted to Canadian dollars at the closing rate at the date of the consolidated balance sheet;
- Items presented in the consolidated statement of earnings, consolidated statement of comprehensive income and consolidated statement of cash flows are translated at average exchange rates during the period (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income, expenses and cash flows are translated at the rate on the dates of the transactions); and
- All resulting exchange differences are recognized in other comprehensive income and recognized as a cumulative translation adjustment account in "Accumulated other comprehensive income" in equity.
  ‌A change in the €/$ foreign exchange rate therefore may have a material impact on the REIT's consolidated financial statements and results.
  The exchange rate used throughout this MD&A for statement of earnings items is the average rate during the applicable period, which for the three-month period ended March 31, 2026, and 2025 was $1.6057 and $1.5102 respectively (6.3% increase).
  For balance sheet items as at March 31, 2026, projections, or market data, the exchange rate used is $1.6075, representing a slight decrease of 0.3% compared to the $1.6119 closing rate as at December 31, 2025.
  Business Environment
  The REIT owns varying interests in real estate entities which hold investment properties. Under IFRS, some of these interests are recorded as joint ventures in which the REIT holds equity. As at March 31, 2026, the REIT's property portfolio consists of ownership interest in five properties that are consolidated and included in "Investment properties" ("IP") on the consolidated balance sheet, and partial ownership interests in five properties that are included within "Investments in joint ventures". As such, the results of these investments in joint ventures are not included in certain of our consolidated financial and operating metrics, unless specifically indicated that such metrics are presented on a "Total Portfolio" basis in which case such results are prepared on a proportionate share basis.
  Together, the REIT's share of these 10 properties (4 located in France, 5 located in Germany and 1 in Spain) is approximately 1.2 million square feet of gross leasable area ("GLA").
  The assets denoted in the maps below are owned entirely by the REIT except where joint venture (JV) is noted.
  
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‌Outlook

In the context of the prevailing macroeconomic and political challenges, management's 2026 areas of focus are:

executing the asset recycling plan through the planned dispositions of the Arcueil property in late 2026 which is conditional upon the issuance of a building permit;
managing cash flow to maintain financial flexibility; and

strategically modernizing the portfolio properties and enhancing their appeal for today's office tenants.

Portfolio Overview

The REIT's Total Portfolio by geographic region as at March 31, 2026 is as follows:

ow ned

Fair value Bank debt

REIT's

Total Portfolio Value

Gross Leaseable Area (GLA)

(sq. ft.)

Contribution to Total Portfolio rental revenue

# of tenants

Occupancy rate

WALT

(end of lease)

Financing maturity

Metropolitain	100%	105,060	53,259	26%	78,818	27%	6	100.0%	5.9	5.0
Arcueil	100%	66,028	49,140	17%	334,521	0%	0	0.0%	-	1.3
Gaia	100%	41,490	35,083	10%	119,504	11%	4	44.3%	2.7	1.0
Delizy (1)	50%	12,052	10,044	2%	71,618	3%	13	41.5%	2.6	3.4
Subtotal France		224,630	147,526	55%	604,461	40%	23	26.7%	3.9	2.7
Delgado	100%	42,920	22,847	11%	117,274	12%	2	100.0%	7.0	1.0
Bad Homburg	100%	19,129	9,487	5%	109,104	5%	6	45.2%	5.1	0.6
Duisburg (1)	50%	39,786	26,446	10%	110,210	14%	5	97.9%	3.5	1.0
Stuttgart (1)	50%	31,688	19,690	8%	121,416	13%	2	99.6%	3.2	0.4
Neu-Isenburg (1)	50%	24,800	17,137	6%	67,337	8%	7	96.0%	3.4	0.4
Kosching (1)	50%	15,785	10,313	4%	53,058	6%	1	100.0%	1.7	0.4
Subtotal Spain & Germany		174,108	105,920	45%	578,398	60%	23	85.9%	4.2	0.7

Total Portfolio		398,738	253,446	100%	1,182,859	100%	46	57.0%	4.1	1.9

IP Portfolio		274,628	169,816	69%	759,222	55%	18	39.3%	5.6	2.3
JV Portfolio		124,111	83,630	31%	423,639	45%	28	88.8%	3.0	1.0

Represents investments that are classified as joint ventures and subject to equity accounting. The results included in the table above (excluding the number of tenants, occupancy metrics, weighted average lease term and financing maturity) are presented on a proportionate share basis at the REIT's ownership percentage of the related investment.
General portfolio updates

At the Gaia property, the main tenant (31% occupancy) exercised its break option for a departure at the end of 2026, one year before its lease term. A new lease is being finalized on 12% areas with a public hospital, which could be effective starting January 2027. Since Q4 2024, the bank loan has been in breach of the DSCR covenant, triggering a temporary cash trap provision. Under this mechanism, cash flows from the property may be applied only to debt service and operating costs, with excess funds deposited into a reserve account until the covenant breach is remedied. As at March 31, 2026, a total of $723 was deposited on the reserve account. Active leasing efforts are underway for the remaining vacant space and alternative redevelopment options are being assessed. The $35,083 mortgage loan matures in March 2027 and, notwithstanding projected occupancy level, Management is confident in obtaining a short-term extension for this financing.
At the Bad Homburg property management intends to refinance the mezzanine facility maturing in November 2026 with conventional financing as leasing activity progresses. Prospect interest on the ground floor on a longterm lease could drive occupancy rate up to 51% in the next quarters. The REIT may selectively engage capital expenditures to support leasing activities.
The Delgado property in Spain is fully leased to two blue-chip tenants (7.3-year WALT and 2.3 years including break options). The REIT intends to formalize in Q2 2026 the waiver of the June 2027 and 2029 break options with one tenant, improving the marketability of this property in a dynamic Spanish real estate market.
At the Neu-Isenburg property, the REIT signed another lease on 2% vacant areas in Q1 2026, bringing occupancy to 96% with a 3.4-year WALT. In connection with the mortgage extension and following discussions with the financing bank in late 2024, the REIT entered into an agreement in October 2025 to market the property for sale. Any net proceeds are expected to be applied toward the amortization of mortgages secured by the Stuttgart and Kösching properties.
In February 2026, the financing bank for the Isenburg, Kosching and Stuttgart properties granted a 6-month extension to the in-place mortgage loans, now maturing at the end of August 2026.

Asset Recycling Plan

Following the sales of the Courbevoie (2022), Sabliere (2025) and Baldi (2025) properties, focus is set on the Arcueil property to close the Asset Recycling Plan.

An exchange contract relating to the sale of an 87.5% interest in the Arcueil property for $60,342 (€37,540), as previously announced in January 2025, remains in effect. Closing is expected before the end of 2026. The long closing is required to satisfy the administrative, building permit and financing conditions. The remaining 12.5% interest in the Arcueil office property is being marketed. Following advanced negotiations and discussions with the senior lender for the Arcueil property, scheduled debt amortization was suspended from Q2 2024 through Q4 2025, deferring approximately $4,200 of annual mortgage principal payments. Formal agreement on the extension of the amortization freeze until Q3 2026 is ongoing.

Tenant Profile

As at March 31, 2026, the REIT had 18 tenants across the IP Portfolio compared to 27 tenants as at December 31, 2025, and 46 tenants across the Total Portfolio (57 as at December 31, 2025).

All lease contracts in France, Germany and Spain have rental indexation. In France, this is based on the Construction Costs Index (Indice du Coot de la Construction "ICC"), the average Tertiary Activities Rent Index (Indice des Loyers des Activites Tertiaires "ILAT"). The Consumer Price Index - CPI, or the German or Spanish Consumer Price Index provides for rent indexation in those jurisdictions. Rent is increased annually to reflect the rising cost of living which protects returns to Unitholders.

Investment Property Portfolio

The following table shows the five largest tenants across the Investment Property Portfolio as at March 31, 2026. The tenant base is well diversified by industry segment, with some national and multinational tenants.

Tenant in the IP Portfolio Tenant Sector

% of annual contractual rental

		revenue
ITP Aero	Aeronautics	11%	59,159	7.8%	8.8
Indra	IT systems	11%	58,115	7.7%	5.3
Bureau Veritas	Consulting and Advisory	14%	36,584	4.8%	0.8
Ameropa	Travel agency	4%	21,105	2.8%	5.8
Come &Work	Coworking	15%	18,808	2.5%	4.0
Top 5 tenants		55%	193,771	25.6%	5.4
Other tenants	Diversified	45%	104,626	13.7%	6.0
Total occupied space		100%	298,397	39.3%	5.6
Vacant			460,825	60.7%
IP Portfolio			759,222	100.0%

Occupied space % of Total Areas (sq. ft.)

Average remaining lease term (years)

The tenant Bureau Veritas confirmed in Q1 2026 its departure at break option, on December 31, 2026, one year before its lease term.

Total Portfolio

The following table shows the REIT's five largest tenants across the Total Portfolio at March 31, 2026, including interests that the REIT has in properties held in joint ventures.

		revenue
Daimler Truck	Automotive	12%	117,431	9.9%	3.2
ITP Aero	Aeronautics	6%	59,159	5.0%	8.8
Indra	IT systems	6%	58,115	4.9%	5.3
Hitachi Power	Manufacturer	6%	54,354	4.6%	1.8
Cariad SE	Automotive	6%	53,058	4.5%	1.7
Top 5 tenants		36%	342,117	28.9%	4.0
Other tenants	Diversified	64%	332,636	28.1%	4.2
Total occupied space		100%	674,753	57.0%	4.1
Vacant			508,106	43.0%
Total Portfolio			1,182,859	100.0%

‌Tenant in the Total Portfolio Tenant Sector

% of annual contractual rental

Occupied space % of Total Areas (sq. ft.)

Average remaining lease term (years)

‌Occupancy and Leasing Activity

The change in occupancy and leasing activity in the IP Portfolio by geographic region for the period ended March 31, 2026 was as follows:

Occupied space (sq. ft.)

IP Portfolio	January 1, 2026	Acquisition / Disposition	New leases	Lease Expiries	March 31, 2026	Occupancy rate
France	147,486	-	9,052	(24,727)	131,811	24.7%
Germany	189,906	(140,594)	-	-	49,312	45.2%
Spain	117,274	-	-	-	117,274	100.0%
Total IP Portfolio	454,666	(140,594)	9,052	(24,727)	298,397	39.3%

The change in occupancy and leasing activity in the Total Portfolio, including joint ventures at the REIT's proportionate ownership interest, by geographic region for the period ended March 31, 2026, was as follows:

Occupied space (sq. ft.)

Total Portfolio	January 1, 2026	Acquisition / Disposition	New leases	Lease Expiries	March 31, 2026	Occupancy rate
France	186,548	-	9,052	(34,043)	161,557	26.7%
Germany	535,290	(140,594)	1,228	-	395,924	85.9%
Spain	117,274	-	-	-	117,274	100.0%
Total Portfolio	839,112	(140,594)	10,280	(34,043)	674,755	57.0%

Lease Maturities

Lease Maturity Profile

(in % of total GLA as at March 31, 2026)

The above graph sets out the percentage of total GLA of the IP Portfolio and Total Portfolio subject to leases expiring by year (excluding early lease terminations).

The average remaining lease terms, not including tenant early termination rights, in the IP Portfolio was 5.6 years (4.1 in the Total Portfolio). Assuming all tenants exercise their early termination rights and leave at the earliest possible date, which the REIT believes is unlikely, the average remaining lease term in both the IP and Total portfolios is 2.8 years.

Out of the 64,000 sq.ft. with a 2026 potential maturity, 36,500 reflects the main tenant lease in the Gaia property which confirmed its departure in December 2026, and 13,000 sq.ft. related to the Delizy property which is undergoing redevelopment and requires evictions.

‌Discussion of Financial Performance ‌Non-GAAP Financial Measures and Other Measures

There are financial measures included in this MD&A that do not have a standardized meaning under IFRS. These measures include funds from operations, adjusted funds from operations, and other measures presented on a proportionate share basis. These measures have been derived from the REIT's financial statements and applied on a consistent basis as appropriate. Management includes these measures as they represent key performance indicators to management, and it believes certain investors use these measures as a means of assessing relative financial performance. These measures, as computed by the REIT, may differ from similar computations as reported by other entities and, accordingly, may not be comparable to other such entities. These measures should not be considered in isolation or used as a substitute for other measures of performance prepared in accordance with IFRS.

"Accretive Acquisition" means that the pro forma (post-deal) net income per Unit is forecast as higher than the REIT's (pre-deal) net income per Unit.

"Adjusted Funds from Operations" or "AFFO" is a meaningful supplemental measure that can be used to determine the REIT's ability to service debt, fund expansion capital expenditures, fund property development, and provide distributions to Unitholders after considering costs associated with sustaining operating earnings.

AFFO calculations are reconciled to net income, which is the most directly comparable IFRS measure. AFFO should not be construed as an alternative to net income or cash flow generated from operating activities, determined in accordance with IFRS.

AFFO is defined as FFO subject to certain adjustments, including adjustments for: (i) the non-cash effect of straight-line rents,

(ii) the cash effect of the rental guarantee received, (iii) amortization of fair value adjustment on assumed debt, (iv) capital expenditures, excluding those funded by a dedicated cash reserve or capex financing, and (v) amortization of transaction costs on mortgage loans.

"Adjusted Funds from Operations per Unit" or "AFFO per Unit" is AFFO divided by the issued and outstanding Units, plus Exchangeable Securities (fully diluted basis).

"AFFO Payout Ratio" is the value of declared distributions on Units, if any, and Exchangeable Securities, divided by AFFO. "Average term to maturity" refers to the average number of years remaining in the lease term.

"Book value per Unit" refers to the REIT's total equity divided by the Weighted average number of Units and Exchangeable Securities (on a fully diluted basis).

"Debt-service covenant ratio calculation" or "DSCR" refers to the rental income divided by the debt service, including interest and amortization.

"Debt-to-Gross-Book Value" refers to the REIT's apportioned amount of indebtedness respectively in the IP Portfolio and the Total Portfolio. Indebtedness on an IP and Total Portfolio basis is calculated as the sum of (i) lease liabilities, (ii) mortgage loans, (iii) other long-term liabilities, and (iv) deferred tax liabilities. Indebtedness does not include certain liabilities as is the case for the Exchangeable Securities and at the joint venture level for the contribution from the REIT and its partners.

"Exchangeable Securities" means the exchangeable securities issued by CanCorpEurope, in the form of interest-bearing notes, non-interest bearing notes and variable share capital.

"Fully diluted basis" refers to a nominal value divided by the issued and outstanding Units, plus Exchangeable Securities.

"Funds from Operations" or "FFO" follows the definition prescribed by the Real Estate Property Association of Canada publication on Funds From Operations & Adjusted Funds From Operations, dated January 2023 with one exception pertaining to the unrealized gain or loss on the REIT's cash in Euros which are domiciled in Canadian financial institutions.

Management considers FFO to be a meaningful supplemental measure that can be used to determine the REIT's ability to service debt, fund capital expenditures, and provide distributions to Unitholders.

FFO is reconciled to net income, which is the most directly comparable IFRS measure. FFO should not be construed as an alternative to net income or cash flow generated from operating activities, determined in accordance with IFRS.

FFO for the REIT is defined as net income in accordance with IFRS, subject to certain adjustments including adjustments for: (i) acquisition, eviction and disposal costs (if any), (ii) net change in fair value of investment properties, (iii) net change in fair value of derivative financial instruments at fair value through profit and loss, (iv) net changes in fair value of Exchangeable Securities, (v) finance costs related to distribution on Exchangeable Securities, (vi) adjustment for property taxes accounted for under IFRIC 21 (if any), (vii) loss on exercise of lease option (if any), (viii) adjustment for foreign exchange gains or losses on monetary items not forming part of an investment in a foreign operation (if any), (ix) gain or loss on disposal of investment properties or an interest in a subsidiary (if any), (x) finance income earned from loans to joint ventures (if any), (xi) loss on extinguishment of loans (if any), (xii) deferred taxes, (xiii) non-controlling interest, (xiv) goodwill

/ bargain purchase gains upon acquisition, (xv) income taxes on sale of investment properties and provision for tax reassessment and (xvi) non-recurring finance income related to bank debt waiver correlated with a sale.

Exchangeable Securities are recorded as liabilities. Exchangeable Securities are recorded at fair value through profit and loss in accordance with IFRS. However, both are considered as equity for the purposes of calculating FFO and AFFO, as they are economically equivalent to the Units, with the same features and distribution rights, that are economically equivalent to the distribution paid to Unitholders, if any.

"Funds from Operations / Unit" or "FFO / Unit" is FFO divided by the issued and outstanding Units, plus Exchangeable Securities (fully diluted basis).

"Gross book value" refers to the total consolidated assets for the IP Portfolio and Total Portfolio.

"Interest Coverage Ratio" or "ICR" covenant refers to a financial metric used to assess a REIT's ability to meet its interest obligations on outstanding debt. It indicates how many times the operating profit can cover the REIT's interest expenses over a given period.

"Investments in Joint Ventures" refers to the REIT's proportionate share of the financial position and results of operation of its investment in joint ventures, which are accounted for using the equity method under IFRS in the consolidated financial statements, are presented below using the proportionate consolidation method at the REIT's ownership percentage of the related investment. Management views this method as relevant in demonstrating the REIT's ability to manage the underlying economics of the related investments, including the financial performance and the extent to which the underlying assets are leveraged, which is an important component of risk management.

For the purpose of the proportionate consolidation, the initial investment of both partners in the joint ventures were considered as being equity investments as opposed to a combination of equity and loans and accordingly, the related proportionate consolidation balance sheet items were eliminated as well as the associated finance income and finance costs. As the loans to the joint ventures were considered equity for proportionate consolidation purposes, any impairment recorded on the loans in accordance with IFRS 9 has been reversed for MD&A purposes. As such, any impairment recorded for IFRS purposes results in a difference in equity when reconciling IFRS and proportionate consolidation reporting.

"Investment Properties Portfolio" or "IP Portfolio" refers to the six wholly owned properties of the REIT.

"Net Rental Income Adjusted for IFRIC 21" refers to Net Rental Income excluding property taxes recorded under IFRIC 21 rules.

"Net Rental Income" or "NRI" refers to the rental income plus operating cost recoveries income plus other property revenue, less property operating costs and other costs.

"Total Portfolio" refers to the six properties referred to as the IP Portfolio and the five properties of the REIT held in joint-ownership with other parties.

"Weighted average lease term" or "WALT" is a metric used to measure a property portfolio's risk of vacancy and refers to the average period in which all leases in a property or portfolio will expire. It is calculated as the sum of the percentages of rentable area multiplied by the number of years in each remaining lease term.

"Weighted Average number of Units" refers to the mean of periodic values in the number of issued and outstanding Units over a specific reporting period.

‌FFO and AFFO Calculation

The reconciliation of FFO and AFFO for the three-month periods ended March 31, 2026, and 2025, based on proportionate consolidation figures including REIT's interest in joint ventures (see the "Consolidated Statement of Earnings - Reconciliation to Consolidated Financial Statements" section), is as follows:

Three months ended March 31,

2026 2025

( including share o f net earnings fro m investments in jo int
Add/(Deduct): Net change in fair value of investment properties	220	(4,743)
Loss on sale of investment properties	517	-
Adjustment for property taxes accounted for under IFRIC 21	2,588	3,043
Net change in fair value of Exchangeable securities	(49)	(4)
Foreign exchange (gain)	-	(65)
Non-recurring finance income from bank debt w aiver	(17,020)	-
Deferred income tax recoveries	-	(40)
Non-controlling interest	818	10
FFO	(158)	173
Add/(Deduct): Non-cash effect of straight line rents	200	192
Cash effect of the rental guarantee	-	184
Amortization of transaction costs on mortgage loans	70	72
Capex	(151)	-
AFFO	(39)	621
FFO / Units (diluted) ($)	(0.00)	0.01
AFFO / Units (diluted) ($)	(0.00)	0.02

Net income attributable to the Trust

12,768 1,972

FFO calculation for the quarter ended March 31, 2026 excludes a $17,020 (€10,600) non-recurring finance income related to the bank debt waiver obtained upon closing the Trio property sale.

‌Overview - GAAP and Non-GAAP

The REIT has identified specific key performance indicators to measure the progress of its long-term objectives. These are set out below:

March 31, 2026 December 31, 2025

Operating metrics	IP Portfolio	Total Portfolio	IP Portfolio	Total Portfolio
Number of properties	5	10	6	11
Gross leasable area (sq. ft.)	759 222	1 182 859	953 136	1 376 773
Occupancy rate - end of period	39,3%	57,0%	47,7%	60,9%
Weighted average lease term	5,6 years	4,1 years	4,3 years	3,7 years
Average initial yield (1)	2,2%	4,2%	3,6%	4,6%
Capital management metrics	IP Portfolio	Total Portfolio	IP Portfolio	Total Portfolio
Available cash (3)	$20 100	$22 853	$25 057	$27 431
Fair value of investment properties (3)	$274 628	$398 738	$291 713	$415 829
Debt-to-gross book value (2)	49,6%	59,1%	56,3%	64,0%
Debt-to-gross book value, net of cash (2)	46,4%	56,9%	53,0%	61,7%
Weighted average loan term to maturity	2,3 years	1,9 years	2,2 years	1,8 years
Weighted average interest rate (2)	3,31%	3,30%	3,46%	3,40%
Interest coverage ratio (2)	0,0 x	0,8 x	0,6 x	1,1 x

Calculated on annualized Net Rental Income (based on Net Rental Income for the year-to-date period).
As defined in the section "Non-GAAP Financial Measures and Other Financial Measures".
See the section "Capital Management" for further discussion on the composition and usefulness of this metric.

Three months ended March 31,

(thousands of $ except per Unit and other data)	2026	2025
Financial performance metrics
Rental revenue	2,813	4,238
Rental revenue - Total Portfolio (1)	5,416	6,541
Net rental income	(739)	155
Net rental income - Total Portfolio (1)	1,561	1,957
Net income, attributable to the Trust	12,768	1,922
Funds from Operations (FFO) (1) (2)	(158)	173
Adjusted Funds from Operations (AFFO) (1) (2)	(39)	621
FFO per Unit (diluted) (1) (2)	(0.00)	0.01
AFFO per Unit (diluted) (1) (2)	(0.00)	0.02

See the section "Non-GAAP Financial Measures" for more information on the REIT's non-GAAP financial measures and reconciliations thereof.
The reconciliation of FFO and AFFO to Net Income can be found under the section "Non-GAAP Reconciliation (FFO and AFFO)".

‌Consolidated Financial Information

Three months ended March 31,

	2026	2025
Rental revenue	2,813	4,238
Property operating cost recoveries	863	1,352
Property operating costs	(4,415)	(5,274)
Other revenues	-	26
Other property operating expenses	-	(187)
Net rental income	(739)	155
General and Administration expenses	(1,493)	(1,317)
Foreign exchange gain	-	65
Loss on disposal of investment properties	(517)	-
Share of net income from joint ventures	806	357
Operating earnings loss	(1,943)	(740)
Net change in fair value of investment properties	(572)	4,156
Net change in fair value of financial derivatives	-	-
Net change in fair value of Exchangeable securities	49	4
Impairment loss of financial assets	(164)	-
Finance income	17,888	727
Finance costs	(1,655)	(2,173)
Distributions on Exchangeable securities	-	-
Income before income taxes	13,603	1,974
Current income tax expense	(17)	(42)
Total income tax expense	(17)	(42)
Net income	13,586	1,932
Non-controlling interest	818	10
Net income attributable to the Trust	12,768	1,922
Selected Three-Year Information

The table below is the summary of key operating metrics for the IP Portfolio.

For the three months ended March 31,

	2026	2025	2024	2026 vs. 2025	2025 vs. 2024
Rental revenue	2,813	4,238	4,631	(1,425)	(393)
Net Rental Income (NRI)	(739)	155	912	(894)	(757)
Net change in fair value of investment properties	(572)	4,156	(11,985)	(4,728)	16,141
Finance costs	(1,592)	(2,173)	(2,710)	581	537
Net loss	13,436	1,932	(13,617)	11,504	15,549
Net loss attributable to the Trust	12,626	1,922	(13,579)	10,704	15,501

Net Rental Income

For the IP Portfolio, Net Rental Income ("NRI") for Q1 2026 decreased to $(739) (€(460)) compared to $155 (€103) for Q1 2025. The decrease was primarily attributable to the sale of the Trio property in January 2026, which largely offset the positive contributions from the Sabliere and Baldi properties that were included in the IP portfolio during Q1 2025 prior to their dispositions in April and December 2025, respectively.

In accordance with IFRIC 21, the annual property taxes for the REIT's properties located in France are expensed in full in the first quarter of the fiscal year. Realty tax expenses for the year are approximately $3,000. These taxes are mostly paid in the fourth quarter. This results in a reduction to NRI in the first quarter of each year with relatively higher Net Rental Income in the subsequent three quarters.

The impact of IFRIC 21 on NRI (in $ and in €) for the three months ended March 31, 2026, and 2025 is set out below.

For the three months ended March 31,

In thousands of $ 2026 2025 Variance

Net rental income	(739)	155	(894)
IFRIC 21 impact	2,251	2,727	(476)
Adjusted net rental income - IFRIC 21 (1)	1,512	2,882	(1,370)

For the three months ended March 31,

In thousands of Euros 2026 2025 Variance

Net rental income	(460)	103	(563)
IFRIC 21 impact	1,402	1,805	(404)
Adjusted net rental income - IFRIC 21 (1)	942	1,908	(966)

(1) Represents a non-GAAP financial measure that has no standardized meaning with IFRS and is not comparable to other companies. See the section

"Non- GAAP Measures and Other Measures".

The NRI, including the REIT's share in joint ventures, is set out below.

For the three months ended March 31,

In thousands of $ 2026 2025 Variance

Net rental income	(739)	155	(894)
Net rental income - proportionate share of JVs	2,300	1,802	498
IFRIC 21 impact	2,588	3,043	(454)
Adjusted net rental income - IFRIC 21 - including proportionate share of JVs (1)	4,149	5,000	(850)

(1) Represents a non-GAAP financial measure that has no standardized meaning with IFRS and is not comparable to other companies. See the section

"Non- GAAP Measures and Other Measures".

General and Administrative Expenses

General and administrative expenses ("G&A expenses") are comprised of Inovalis S.A.'s asset management fees and other G&A expenses such as trustee fees, directors' and officers' liability insurance, professional fees (including accountin g fees), legal fees, filing fees, and Unitholders related expenses.

Q1 2026 G&A expenses showed a slight increase of $176, notably on Trustee fees ($129) mostly driven by the termination of the 2025 Amended and Restated Deferred Unit Plan effective January 1, 2026. Trustee compensation is now paid in cash. The outstanding Deferred Units ("DSUs") were mostly exercised in Q1 2026 with the balance exercised subsequent to the quarter-end in April.

Three months ended March 31,

	2026	2025	Variance
Asset management fees - Inovalis SA	(348)	(462)	114
Less: amount reinvoiced to joint ventures	319	300	19
	(29)	(162)	133
Professional fees for accounting. tax and audit	(592)	(558)	(34)
Legal expenses	(170)	(153)	(17)
Trustee fees	(193)	(64)	(129)
Travel expenses	(147)	(105)	(42)
Governance expenses	(104)	(77)	(27)
Bank and depositary expenses	(77)	(51)	(26)
Listing, transfer agent and publication fees	(16)	(19)	3
Other general and administrative expenses	(165)	(128)	(37)
Total G&A expenses	(1,493)	(1,317)	(176)
Share of Net Income from Joint Ventures

The performance of the investments in joint ventures includes the share of net income from joint ventures; the interest on loans granted to joint ventures is presented on the finance income line.

The share of net income from joint ventures for the first quarter of 2026 was $806, stable compared to $357 for the same period in 2025.

Net Change in Fair Value of IP Portfolio

The net decrease in fair value of the IP Portfolio for the three months ended March 31, 2026 was $572 compared to a positive $4,156 for the same period in 2025. Q1 2026 figure was notably dragged by the $4,018 (€2,500) fair value decrease of the Gaia property, embedding the early termination of the main tenant lease, effective December 2026, and offsetting the usual IFRIC 21 positive impact.

Refer to the paragraph "IP Portfolio" in the "Consolidated balance sheet" section of this MD&A for further details on the valuation methodology.

Net Change in Fair Value of Exchangeable Securities

Exchangeable Securities are recorded at fair value based on the market price of the Units. They are reflected as a liability on the REIT's consolidated balance sheet, and therefore a decrease of the REIT's Unit price reduces the value of the liability. The closing price of a REIT Unit on the Toronto Stock Exchange was $0.86 on March 31, 2026, compared to $1.06 at close of December 31, 2025, resulting in a $46 net change in fair value of Exchangeable Securities for the first quarter of 2026.

Finance Income

In Q1 2026, finance income included $775 interest on loans granted to joint ventures. It also included, as non-recurring income, the $17,020 bank mortgage loan waiver related to the Trio transaction, concurrently to the sale.

Finance Costs

The $1,655 finance costs for Q1 2026 (decrease from $2,173 in Q1 2025), including the interest on lease liabilities and mortgage loans, reflected the sale of 3 properties (Sabliere, Baldi and Trio) and the full repayment of their related loans.

Consolidated Balance Sheet
Assets	As at March 31, 2026 As at December 31, Variance 2025
Non-current assets
Investment properties	274,628	275,916	(1,288)
Investments in joint ventures	35,883	35,174	709
Other financial assets	459	460	(1)
Restricted cash	80	684	(604)
Total non-current assets	311,050	312,234	(1,184)
Current assets
Trade receivables and other financial assets	8,420	7,975	445
Other current assets	2,261	1,944	317
Restricted cash	1,286	373	913
Cash	20,100	25,057	(4,957)
Total current assets	32,067	35,349	(3,282)
Asset held for sale	-	15,797	(15,797)
Total assets	343,117	363,380	(20,263)

Liabilities and Unitholders' equity As at March 31, 2026 As at December 31,

2025

Variance

Liabilities

Non-current liabilities

Interest-bearing loan	204	205	(1)
Mortgage loans	-	57,993	(57,993)
Lease liabilities	87,226	90,682	(3,456)
Tenant deposits	1,710	2,176	(466)
Total non-current liabilities	89,140	151,056	(61,916)
Current liabilities
Interest-bearing loan	73	26	47
Mortgage loans	67,417	42,623	24,794
Lease liabilities	15,173	12,999	2,174
Tenant deposits	649	-	649
Exchangeable securities	338	416	(78)
Trade and other payables	9,376	8,535	841
Provisions	277	278	(1)
Income tax payable	8,302	9,550	(1,248)
Deferred income	1,310	248	1,062
Total current liabilities	102,915	74,675	28,240
Total liabilities	192,055	225,731	(33,676)
Equity
Trust units	301,062	300,859	203
Retained earnings	(179,140)	(191,908)	12,768
Accumulated other comprehensive income	29,477	29,856	(379)
Total Equity	151,399	138,807	12,592
Non-controlling interest	(337)	(1,158)	821
Total liabilities and equity	343,117	363,380	(20,263)

Selected Consolidated Balance Sheet Information

	March 31, 2026	Dec. 31, 2025	Dec. 31, 2024	2026 vs. 2025	2025 vs. 2024
Fair value of investment properties - IP Portfolio (1)	274,628	291,713	353,850	(17,085)	(62,137)
Fair value of investment properties - Total Portfolio (1)	398,738	415,829	476,579	(17,091)	(60,750)
Investment in joint ventures - carrying value	35,883	35,174	37,047	709	(1,873)
Total assets	343,117	363,380	412,216	(20,263)	(48,836)
Total debt (2)	170,093	204,528	215,508	(34,435)	(10,980)
Total non-current liabilities	89,140	151,056	152,130	(61,916)	(1,074)
Unitholders' equity	151,400	138,807	182,038	12,593	(43,231)
Number of outstanding Units	33,492,816	33,302,307	33,206,180	190,509	96,127

Including assets held for sale.
Includes the current and non-current portion of interest-bearing loan, mortgage loans, lease liabilities.

IP Portfolio

The fair value of the REIT's IP Portfolio as at March 31, 2026, was $274,629 (€170,846), a decrease compared to $291,713 (€180,974), including asset held for sale, as at December 31, 2025. The decrease was mainly attributable to the sale of the Trio property ($15,797), while the negative change in fair value of the Gaia property ($4,018), driven by the main tenant's departure confirmation, was largely offset by the recurring IFRIC-related uplift.

Management uses the Direct Capitalization Method ("DCM") to determine the fair value of all the REIT's properties in France, Germany and Spain. The values are supported by external appraisals of the Total Portfolio as at December 31, 2025, performed in conformity with the requirements of the Royal Institution of Chartered Surveyors Standards, and for the French properties, in conformity with the "Charte de l'expertise immobiliere", as well as European Valuation Standards of TEGoVA (the European Group of Valuers' Association) and IFRS 13 Fair Value Measurement. Considering the significant change in leasing parameters on the Gaia property, with the main tenant's lease early termination, Management requested an adjusted valuation report for this property as at reporting date. For the Arcueil property, the value is determined based on the condition of the exchange contract signed in December 2024, at a discount rate of 6.08% reflecting the risk associated with this longterm sale (anticipated for the fourth quarter of 2026).

Investments in Joint Ventures

The investment in joint ventures encompasses the interest of the REIT (through five subsidiaries) in:

the Duisburg property (50%), through a joint venture agreement maturing in March 2027 in line with the current senior financing agreement;
the Stuttgart property (50%), through a joint venture agreement maturing in August 2026 correlated with the senior financing;
the Delizy property (50%), through a joint venture agreement maturing in 2029, correlated with the lease liability contract with the senior bank;
the Neu-Isenburg property (50%), through a joint venture agreement maturing in August 2026 correlated with the senior financing;
the Kosching property (50%), through a joint venture agreement maturing in August 2026 correlated with the senior financing;

Regarding the properties for which the JV terms are linked to senior financing maturing within 12 months, management is confident it can obtain an extension without requiring significant deleveraging. In addition, the JV partners retain the ability to extend the joint venture agreements, notwithstanding their current alignment with the senior financing.

The REIT's investment in joint ventures was $35,883, stable compared to $35,174 as at December 31, 2025 and including a $806 share of net income from joint venture.

Trade Receivables and Other Financial Assets

Trade receivables and other financial assets as at March 31, 2026, amounted to $8,420, in increase compared to $7,975 at December 31, 2025 mostly attributable to $4,516 interest receivable on joint venture loans ($3,913 as at year end 2025) that are presented net of a $3,743 impairment loss on the Delizy loan ($164 recorded during Q1 2026). Interest payments have been deferred on all joint venture properties to prioritize the use of free cashflow to meet new financing terms (amortization or cash reserve payments) or to fund tenant incentives for reletting.

Trade and Other Payables

Trade and other payables totaled $9,376 as at March 31, 2026, compared to $8,535 as at December 31, 2025. Pursuant to IFRIC 21, the trade payables amount in Q1 2026 included approximately $2,250 full year property taxes

Income Tax Payable

In December 2025, the Paris Administrative Court issued a ruling regarding withholding tax reassessments related to the Arcueil property for the 2017 to 2019 taxation years, during which the REIT held a 25% interest through a joint venture. The Court upheld the reassessments and, accordingly, an amount of €5,888 ($9,465) is payable to the French tax authorities.

In Q1 2026, the REIT filed an appeal claiming to recover €4.116 million ($6.616 million) related to withholding taxes upon submission of documentation supporting the tax residency of CanCorpEurope, Luxembourg (the REIT's subsidiary) and the joint venture partner's status as a regulated entity in Korea. There can be no assurance as to the outcome of the appeal process. Management has secured a deferred payment schedule over twelve months, with the remaining balance payable in 2027 or from any sale proceeds. As at March 31, 2026, 2 instalments were paid, decreasing the payable amount by

$1,222.

‌Capital Management Sources of Capital

The REIT's primary sources of capital are cash generated from operations, disposition of assets and sharing the ownership of actual assets owned entirely. The primary uses of capital include costs for attracting and retaining tenants, recurring property maintenance, major property improvements, and debt interest payments. The REIT expects to meet ongoing obligations through current cash, cash flows from operations, asset disposition, debt refinancing and, as growth requires and when appropriate, new equity or debt issues. Mature assets have been sold to access capital readily available for redeployment, in line with an overall strategy of diversification of the portfolio.

Capital Management Metrics

To measure the REIT's debt performance, management uses the non-GAAP key indicators below:

Consolidated basis -IP Portfolio

Proportionate share basis -Total Portfolio

	March 31, 2026	December 31, 2025	March 31, 2026	December 31, 2025
Capital management metrics
Debt-to-gross book value	49.6%	56.3%	59.1%	64.0%
Debt-to-gross book value, net of cash	46.4%	53.0%	56.9%	61.7%
Debt due in the next 12 months (1)	82,590	55,622	156,681	103,167
Weighted average loan term to maturity	2.3 years	2.2 years	1.9 years	1.8 years
Weighted average interest rate (1)	3.31%	3.46%	3.30%	3.40%
Interest coverage ratio (2)	0.0	0.6	0.8	1.1

Includes lease liabilities and mortgage financings.
As defined in the section "Non-GAAP Financial Measures and Other Financial Measures".

The mortgage loans on the Gaia and Delgado properties, maturing respectively on March 27 and March 31, 2027, have been reclassified to the "debt due in the next 12 months" as at March 31, 2026, representing a total of $57,930. The Trio mortgage loan of $23,669 as at December 31, 2025, was fully extinguished upon its sale in January 2026.

Financing covenants

Since December 31, 2024, the Interest Coverage Ratio covenant for the Gaia property has been breached as a result of a low occupancy rate consecutive to defaulting tenants, triggering a cash trap provision.

Under this mechanism, cash flows generated by the property may be applied only to operating costs and debt service, with excess amounts retained in the restricted account until the covenant is restored. A total of $723 was transferred to the cash reserve in accordance with the cash trap provision and is presented as restricted cash.

The REIT has been in communication with the lender of the Gaia property to update them on leasing, rent collection and disposition plans that would remedy the covenant breach and allow for a loan maturity extension. Although the lenders have given no indication that would indicate an intention to call the capital on loans despite the breach of covenants, the lenders could enforce their rights and the applicable loan amounts would then become immediately due and payable. See "Risks and Uncertainties" in this MD&A.

Debt-to-Gross Book Value

The debt-to-gross book value ratio is a non-GAAP measure that considers the REIT's apportioned amount of indebtedness respectively in the IP Portfolio and the Total Portfolio. Indebtedness on an IP and Total Portfolio basis is calculated as the sum of (i) lease liabilities, (ii) mortgage loans, (iii) other long-term liabilities, and (iv) deferred tax liabilities. Indebtedness does not include certain liabilities as is the case for the Exchangeable Securities and at the joint venture level for the contribution from the REIT and its partners.

Debt-to-gross book value

Consolidated basis -IP Portfolio

Proportionate share basis -Total Portfolio

	March 31, 2026	December 31, 2025	March 31, 2026	December 31, 2025
Lease liabilities	102,399	103,681	112,443	113,761
Mortgage loans	67,417	100,616	141,003	174,407
Interest-bearing loans	204	189	585	278
Deferred tax liabilities	-	-	3,129	3,138
Total debt outstanding	170,020	204,486	257,160	291,584
Less : Cash	(20,100)	(25,057)	(22,853)	(27,431)
Debt net of cash	149,920	179,429	234,307	264,153
Gross book value	343,117	363,380	434,900	455,272
Gross book value. net of cash	323,017	338,323	412,047	427,841
Debt-to-gross book value	49.6%	56.3%	59.1%	64.0%
Debt-to-gross book value, net of cash	46.4%	53.0%	56.9%	61.7%

The sale of the Trio property for its fair value for $15,797 on January 30, 2026, and waiver of $17,020 (€10,600) of indebtedness had a positive impact on the debt-to-gross book value ratio. With a debt-to-gross book value ratio of 59% for the Tota Portfolio level, the REIT continues to operate within its mandated cap of 60%.

Interest Coverage Ratio

Interest coverage ratio

Consolidated basis -IP Portfolio

Proportionate share basis -Total Portfolio

	3 months ended	Year ended		3 months ended	Year ended
	March 31, 2026	December 31, 2025		March 31, 2026	December 31, 2024
Net rental income	(739)	10,553		1,561	19,172
IFRIC 21 adjustment	2,251	-		2,588	-
Indemnities	-	(458)		(458)	(458)
Net rental income adjusted for non-	1,512	10,095		3,691	18,714
recurring income
General and Administrative expenses	(1,493)	(5,442)	(1,896)		(6,995)
Interest income (2)	-	-	-		-
Total income	19	4,653	1,795		11,719
Interest expense (1)	(1,618)	(7,989)	(2,394)		(11,020)
Interest coverage ratio	0.0	0.6	0.8		1.1

Includes interest on mortgage loans, leases liabilities, swap interest and amortization of financing costs.
Excluding interest income on joint venture loans

Weighted-Average Interest Rate

With the sale of the Trio property and the termination of its floating rate mortgage loan, the weighted average interest rate across the IP and Total Portfolio debt, including bank margin, slightly declined to 3.31% and 3.30% respectively, compared to 3.46% and 3.40% at December 31, 2025. Management is negotiating debt service reduction with senior lenders, including the refinancing of the 12% mezzanine facility with conventional financing as leasing activity progresses.

Debt Profile

Debt profile as at March 31, 2026

	IP Portfolio				Total Portfolio
	Carrying value	%			Carrying value	%
Lease liabilities	102,399		60%		112,443	44%
Mortgage loans	67,417				141,003
of which :	Amortized mortgage loan	22,847	13%	33,160		13%
	Bullet mortgage loan	44,570	26%	107,843		43%
	Total	169,816	100%	253,446		100%

As at March 31, 2026, the debt on the IP Portfolio is composed of 60% lease liabilities and 40% mortgage loans, under contracts expiring from 2026 (Bad Homburg) to 2031 (Metropolitan). The average term of repayment of financing is 2.3 years (1.9 years on the Total Portfolio). Lease liabilities contracts are not bound by loan-to-value or debt-service-coverage-ratio covenants.

The REIT usually repays principal amounts quarterly on both mortgage and lease liabilities. This represents 73% of the REIT's IP Portfolio financing, excluding bullet mortgage loans (57% on the Total Portfolio). Management is in regular communication with the senior lenders, including those of Gaia, Arcueil and Delizy properties, to update them on leasing, redevelopment and sale strategies and the renegotiation of financing terms for the in-place loans (particularly amortization schedules). Following advanced negotiations and discussions with the senior lender for the Arcueil property, scheduled debt amortization was suspended from Q2 2024 through Q4 2025, deferring approximately $4,200 of annual mortgage principal payments. Following significant progress in the sale process, including the submission of the building permit application, an extension of the amortization deferral until Q4 2026 was granted and is being formalized with the lender as at the reporting date.

A similar deferral was granted by lenders on the Delizy lease liability at the end of 2024, which was extended at the end of 2025, deferring the amortization for one year until Q4 2026.

Leasehold and Mortgage Financing Maturity Profile

(in % of amount outstanding as at March 31, 2026)

The 2026 mortgage maturities relate primarily to the three properties held as joint ventures (Stuttgart, Neu-Isenburg and Kosching) with mortgage loans maturing in August 2026 (total of $47,140). In addition, the new mezzanine $9,487 18-month loan on the Bad Homburg property matures in November 2026.

The 2027 mortgage maturities relate mostly to the lease liability contract with the bank on the Arcueil property, in addition to the Delgado, Duisburg and Gaia financings. Notwithstanding significant vacancies, Management is confident in obtaining an extension of the Gaia mortgage loan at maturity, without deleverage.

Equity

Management's discussion about equity is inclusive of Exchangeable Securities. In the consolidated financial statements, the Exchangeable Securities are classified as current liabilities under IFRS because of the conversion feature that can be exercised by the holder of those securities at any time.

As at March 31, 2026, the REIT has 33,492,816 Units issued and outstanding, plus 392,892 Exchangeable Securities. Under the Deferred Unit Plan, which was terminated effective January 1, 2026, 190,509 Deferred Units were exercised and converted into Units during the quarter.

	Three months ended
	March 31, 2026
Units Number at beginning of period	33,302,307
Increase in number during the period	190,509
Number at end of period	33,492,816
Weighted average number during the period	33,385,111
Exchangeable securities
Number at beginning of period	392,892
Number at end of period	392,892
Weighted average number during the period	392,892
Units and Exchangeable securities
Number at beginning of period	33,695,199
Increase in number during the period	190,509
Number at end of period	33,885,708
Weighted average number during the period	33,778,003

Unitholder's Equity

The Unitholders' equity breakdown over the first quarter of 2026 is presented below (in $ million):

Notes to the Unitholder's equity chart:

Foreign exchange impact: The closing foreign exchange rate was 1.6075 as at March 31, 2026, a slight decrease of 0.3% compared to 1.6119 as at December 31, 2025, leading to a minor impact on the REIT's NAV.
Income from JV includes the share of net income for $806, added to $775 in finance income from interest on joint venture loans.
Finance costs of $1,655 are presented net of $868 finance income (mostly $775 interest on joint venture loans).
The non-recurring finance income related to the waiver of remaining bank loan balance on the Trio operation is presented separately.
Available and Restricted Cash
Following the 2025 successful dispositions of its Sabliere ($15,300 net proceeds) and Baldi ($18,363 net proceeds) properties, the REIT's available cash was $20,100 as at March 31, 2026 (compared to $25,057 as at December 31, 2025). In addition to usual operations (debt service, operating expenses and structure costs), the REIT paid $1,222 to tax administration in its litigation on the withholding tax rate. Available funds are intended to be used for senior debt payments (interest and amortization), investment in tenant improvements for leasing and tax litigation payment (pending potential partial refund in appeal). In addition to this available cash, the REIT held:
$1,366 of restricted cash, that could be used for partial deleverage ahead of loan extensions or repayment upon sale.

$5,369 of cash in the assets held in joint venture, including $2,616 restricted cash constituted upon refinancing of debts and intended to secure senior lenders or finance capital expenditures and incentives for future reletting.

Cash Flows

The table below shows the cash utilization throughout the first quarters of 2026 and 2025 for the IP Portfolio, not including the REIT's share of cash in the joint venture-owned properties. Management will continue to closely monitor cash and negotiate payment deferral from banks or suppliers when necessary to meet working capital requirements.

Three months ended March 31,
	2026	2025	Variance

Cash at the beginning of the year	25,057	6,249	18,808
Cash provided by (used in): Operating activities	(3,804)	928	(4,732)
Investing activities	15,406	3	15,403
Financing activities (16,800) (2,090) (14,710)
Net change during the year	(5,198)	(1,159)	(4,039)
Impacts of FX adjustment on cash	241	241	0
Cash at period-end	20,100	5,331	14,769

Unit-Based Compensation Plan

In February 2026, the Trustees approved the immediate vesting of all previously unvested Deferred Units held by Trustees. The Trustees also determined that, effective February 4, 2026, the Deferred Unit Plan will no longer be used as a form of Trustee compensation and that no further Deferred Unit grants will be made unless the Board determines otherwise. All outstanding Deferred Units will continue to be governed by the terms of the Deferred Unit Plan until settlement. Effective January 1, 2026, all Trustee compensation, including annual retainers, committee fees and meeting fees, will be paid solely in cash, with the annual cash retainer for each Trustee increased from $30,000 to $50,000 in lieu of Deferred Unit compensation.

As of March 31, 2026, 61,695 DSUs are outstanding; 190,509 DSUs had been exercised during the quarter.

‌Financial Instruments

The REIT has the following financial assets and liabilities as at March 31, 2026:

Classification

Financial assets

Loans to joint ventures Amortized cost Trade receivables and other financial assets Amortized cost Restricted cash Amortized cost

Cash Amortized cost

Financial liabilities

Mortgage loan Amortized cost

Tenant deposits Amortized cost

Exchangeable Securities Fair Value Through Profit and Loss

Trade and other payables Amortized cost

The REIT uses the following hierarchy for the fair value determination of financial instruments:

Level 1 quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3 unobservable inputs for the asset or liability.
There were no transfers between levels of the fair value hierarchy during the three months ended March 31, 2026.
Due to their short-term nature, the carrying value of the following financial instruments measured at amortized cost approximates their fair value at the balance sheet date:
Trade receivables and other financial assets
Cash and restricted cash
Trade and other payables

March 31, 2026 December 31, 2025

	Fair Value	Carrying Value	Fair Value	Carrying Value
Financial assets
Loans to joint ventures	21,622	21,622	21,683	21,683
Financial liabilities
Mortgage loans	65,863	67,417	99,153	100,616
Tenant deposits	2,359	2,359	2,176	2,176

The following methods and assumptions were used to estimate the fair values of financial instruments:

The fair value of the loans to joint venture was estimated using the nominal amounts expected to be received at maturity and a discount rate based on prevailing market interest rates adjusted by an internally determined credit spread.
Mortgage loans were carried at amortized cost using the effective interest method of amortization. The estimated fair values of long-term borrowings were based on market information, when available, or by discounting future payment of interest and principal at estimated interest rates expected to be available to the REIT as at March 31, 2026, and December 31, 2025.
The fair value of the mortgage loans was determined by discounting the cash flows of these financial obligations using December 31, 2025, market rates for debt with similar terms (Level 2). Based on these assumptions, the fair value of the mortgage loans as at March 31, 2026, was estimated to be $65,863 (December 31, 2025 - $99,153) compared with the carrying value before deferred financing costs of $67,417 (December 31, 2025 - $100,616). The fair value of the mortgages payable varies from the carrying value due to fluctuations in interest rates since their issuance.
The fair value of:
tenant deposits is estimated using the nominal amounts expected to be repaid at maturity and a discount rate based on prevailing market interest rates adjusted by an internally determined credit spread.
derivative financial instruments is determined based on discounted cash flows using interest rate yield curves and volatility that are observable on an active market, as at the balance sheet date.
Exchangeable Securities is based on the quoted price of the Units, on the basis that they are exchangeable on a one-to-one basis at the request of the holders of Exchangeable Securities. Other features of Exchangeable Securities have no significant impact on their fair value.

The REIT is exposed to several financial risks, including those associated with financial instruments, which have the potential to affect its operating and financial performance. These risks include interest rate risk, currency risk, credit risk and liquidity risk.

Liquidity Risk and Going concern

The REIT's objective is to maintain a balance between continuity of funding and flexibility using bank deposits and loans. Liquidity risk inherent to the financial structure of the business is mainly managed through quarterly updates of short-term cash flow forecasts as well as the status of the maturity of financial assets and liabilities.

The REIT has prepared the financial statements on the basis that it will continue to operate as a going concern. This going concern basis assumes that the REIT will continue in operation for the foreseeable future and will be able to realize its assets and settle its obligations in the normal course of business. Management's going concern assessment includes forecasting of cashflow requirements under various stress-tested scenarios in order to assess whether there exist any material risks as to the REIT's ability to operate as a going concern. In doing so, management has determined that there is a material uncertainty associated with this going concern assumption, as it requires the completion of refinancing or extension of bank loans maturing within the 12 months following the release of the financial statements.

A - Availability of financing

The mortgage loans financing the Stuttgart ($19,690), Neu-Isenburg ($17,137) and Kosching ($10,313) properties, held 50% in joint venture, mature on August 30, 2026, following a short-term extension obtained in February 2026. This extension provides the REIT with additional time to assess refinancing options or negotiate a potential sale. Management remains confident in its ability to secure refinancing or negotiate a further extension at the new maturity date. However, should repayment be required at maturity, any liquidity risk arising from a default would remain isolated at the entity level.

The Gaia loan ($35,083) matures on March 27, 2027. Management is in ongoing discussions with the lender regarding the leasing or redevelopment strategy for the property, which has a 75% projected vacancy rate by end-2026. Based on discussions held to date, management is confident in obtaining an extension of the loan at maturity or refinancing it; however, the lender may require deleveraging as part of the extension process.

The Delgado loan ($22,847) matures on March 31, 2027. Given the 100% occupancy rate, the 53% LTV based on Q4 2025 external appraisal and the advanced negotiations regarding the extension of one significant lease, management is confident in its ability to obtain an extension or refinancing. In addition, this asset could be marketed and generate significant work ing capital that the REIT could use to mitigate any existing liquidity risk.

The mortgage financing for Duisburg ($26,446), a property held 50% in a joint venture, matures on March 31, 2027. The property is 100% leased and management is confident in obtaining an extension of the existing loan or in refinancing it. Shareholders have already suspended distributions in order to retain cash for tenant improvements and potential debt deleveraging. However, should repayment be required at maturity, the asset could be marketed, and any liquidity risk arising from a default would remain isolated at the entity level.

B - Risk Mitigation

Ability to unlock liquidity

In addition to the above-mentioned possible disposition of Delgado and Duisburg properties, management also notes that the REIT has the ability to unlock liquidity as required through the disposal of other marketable and in-demand assets (notably Metropolitain). The sale of this asset would generate significant positive working capital that the REIT could use to mitigate any existing liquidity risk.

Sale of the Arcueil property

On December 18, 2024, the REIT signed an exchange contract for the sale of 88% of the Arcueil property for redevelopment. In 2025, the REIT completed administrative milestones, waiving conditions and the final closing sale is still anticipated for the end of 2026. The sale is expected to generate net cash proceeds of $5.5 million.

Management assessment

Management expects that any remaining short-term liquidity requirements can be addressed through the active management of working capital and capital expenditure commitments. This includes the ability to defer certain tax payment deadlines, adjust capex schedules, and manage vendor payment terms. In forming this assessment, management also considered the REIT's history of successfully implementing capital management strategies.

Interest Rate Risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in mark et interest rates. The REIT's exposure to the risk of changes in market interest rates relates to the long-term debt obligations with floating interest rates related to leases and mortgage loans. At March 31, 2026, 37% of the REIT's Investment Portfolio and Total Portfolio long-term debt obligation has no exposure to interest rate risk. Floating rate debt is mostly on assets included in the Asset Recycling Plan or with short-term financing maturity.

Credit Risk

Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The REIT is directly exposed to credit risk from its leasing activities and its investing activities, including the acquisition loans, trades and other receivables, loans in other current financial assets, derivatives, deposits with banks and financial institutions. The REIT's maximum exposure to credit risk is limited to the carrying amount of financial assets recognized on March 31, 2026.

Loan to joint ventures: Credit risk relating to loan to joint ventures is mitigated through recourse against such parties and/or the underlying real estate. These financial instruments are considered low credit risk. The REIT monitors the debt service ability of the properties underlying the loans to assess for changes in credit risk.

Accounts receivable: Credit risk is managed by requiring tenants to pay rentals in advance. Also, in certain cases, deposits are obtained from tenants. Accounts receivables are presented on the consolidated balance sheet, net of allowance for credit losses determined using the simplified method as allowed per IFRS 9. This provision is based on the expected recovery percentage of amounts receivable from each tenant and various other indicators, such as a deterioration of the credit situation of a given tenant. Management regularly reviews accounts receivable and monitors past due balances.

Cash deposit and derivatives: Credit risk on cash and derivative financial instruments is managed through selecting appropriate financial institutions. The REIT holds its cash deposits in bank accounts with a diversified group of large public financial institutions in France, Germany, and Spain, financial institutions are selected based on their quality of credit rating and their level of financial transparency. The REIT enters into its derivative financial contracts by utilizing large, public financial services firms or mid-sized, public financial services firms at which balances are backed by large, public financial services firms. Considering the recent economic developments in the banking industry on a global scale, management continues to assess its exposure to credit risk and is actively monitoring the situation to limit the impact on the REIT.

‌Quarterly Information - Last Eight Quarters

As at and for the three months ended

	March 31 2026	Dec.31 2025	Sept.30 2025	June 30 2025	March 31 2025	Dec. 31 2024	Sept.30 2024	June 30 2024
Rental revenue	2,813	4,267	4,380	4,419	4,238	5,258	4,688	4,062
Rental revenue - Total Portfolio (1)	5,416	6,714	6,877	6,877	6,541	7,546	6,689	6,067
Net rental income	(739)	3,416	3,701	3,280	155	4,732	3,518	4,616
Net rental income - Total Portfolio (1)	1,561	5,761	6,053	5,401	1,957	6,817	5,101	6,799
Net income attributable to Unitholders	12,768	(46,834)	189	(11,251)	1,922	(25,999)	(9,417)	(20,140)
FFO (1)	(158)	(6,865)	591	(222)	183	662	(1,181)	727
AFFO (1)	(39)	(7,888)	(875)	(514)	631	357	(887)	(108)
FFO per Unit (diluted) (1) (2)	(0.00)	(0.20)	0.02	(0.01)	0.01	0.02	(0.04)	0.02
AFFO per Unit (diluted) (1) (2)	(0.00)	(0.23)	(0.03)	(0.02)	0.02	0.01	(0.03)	(0.00)
Declared distribution per Unit (3)	-	-	-	-	-	-	-	-
FFO payout ratio (2) (3)	-	-	-	-	-	-	-	-
AFFO payout ratio (2) (3)	-	-	-	-	-	-	-	-

See the following section "Non-GAAP Financial Measures" for more information on the REIT's non-GAAP financial measures and reconciliations thereof. Non-GAAP measures do not have standardized meaning under IFRS. These measures as computed by the REIT may di ffer from similar computations as reported by other entities and, accordingly, may not be comparable to other entities.
Based on the diluted weighted average number of Units and Exchangeable Securities

Excluding the $0.1831 and $0.225 special distributions declared on December 31, 2025 and December 31, 2024 respectively

‌Related party transactions‌

Pursuant to a fifth amended and restated management agreement dated March 27, 2023 between Inovalis S.A. as asset manager, and the REIT (the "Management Agreement"), Inovalis S.A. provides the strategic, advisory, asset management, project management, construction management, property management and administrative services necessary to manage the operations of the REIT and its subsidiaries.

Inovalis S.A. is a related party of the REIT as they share the same management. The founder and Chair of Inovalis SA is President and Chief Executive Officer ("CEO") of the REIT and the Deputy Chief Executive Officer of Inovalis S.A. is Chief Investment Officer ("CIO") and Chief Financial Officer ("CFO") of the REIT.

On January 30, 2026, the REIT completed the sale of the Trio property. In conjunction with these sales, the REIT incurred disposition fees totaling €98 ($157) paid to Inovalis SA and paid a portion of broker fees totaling €100 ($161) to Advenis Germany, a subsidiary of Inovalis SA.

Management Agreement

The Management Agreement term of three years ends March 31, 2026, and has been extended for an additional term of one year.

Investment in Joint Ventures, Reconciliation

Consolidated Statement of Earnings - Reconciliation to Consolidated Financial Statements

Three months ended March 31, 2026 March 31, 2025

Amounts per REIT's financial

Share of net earnings from

Total

Amounts per REIT's financial

Share of net earnings from

Total

	statements (1)	investments in joint ventures (2)		statements (1)	investments in joint ventures (2)
Rental income	2,813	2,603	5,416	4,238	2,303	6,541
Property operating cost recoveries	863	761	1,624	1,352	484	1,836
Property operating costs	(4,415)	(1,064)	(5,479)	(5,274)	(928)	(6,202)
Other revenues	-	-	-	26	31	57
Other property operating expenses	-	-	-	(187)	(88) -	(275) -
Net rental income	(739)	2,300	1,561	155	1,802	1,957
General and administrative expenses	(1,493)	(403)	(1,896)	(1,317)	(377)	(1,694)
Foreign exchange gain	-	-	-	65	-	65
Loss on disposal of investment properties	(517)	-	(517)	-	-	-
Share of net income from joint ventures	806	(806)	-	357	(357)	-
Operating earnings (loss) income	(1,943)	1,091	(852)	(740)	1,068	328
Net change in fair value of investment properties	(572)	352	(220)	4,156	587	4,743
Net change in fair value of Exchangeable securitie	49	-	49	4	-	4
Impairment loss of financial asset	(164)	164	-	-	-	-
Finance income	17,888	(775)	17,113	727	(727)	-
Finance costs	(1,655)	(791)	(2,446)	(2,173)	(853)	(3,026)
Income before income taxes	13,603	41	13,644	1,974	75	2,049
Current income tax expense	(17)	(41)	(58)	(42)	(65)	(107)
Deferred income tax recovery	-	-	-	-	40	40
Total income tax expense	(17)	(41)	(58)	(42)	(25)	(67)
Net income (2)	13,586	-	13,586	1,932	50	1,982
Non-controlling interest	818	-	818	10	-	10
Net income attributable to the Trust	12,768	-	12,768	1,922	50	1,972

Statement of Earnings amounts presented for the REIT were taken respectively from unaudited interim condensed financial statements as at March 31, 2026 and 2025.
The difference in net income when comparing the REIT's financial statements for IFRS purposes and the REIT's financial statem ents for proportionate consolidation purpose (Non-GAAP) relates entirely to the impairment charge recorded on the REIT's loan to Delizy joint venture in accordance with IFRS 9. As the loan to Delizy has been considered equity for proportionate consolidation purposes, no impairment under IFRS 9 has been recorded resulting in a reconciliation difference

Balance Sheet Reconciliation to Consolidated Financial Statements

As at March 31, 2026 As at December 31, 2024

Assets	As per REIT's financial	Share from Proportionate investments in Consolidation			As per REIT's Share from Proportionate financial investments in Consolidation
	statements (1)		joint-ventures (2)		statements (1)	joint-ventures (2)
Investment properties	274,628		124,110	398,738	275,916	124,116	400,032
Investments in joint ventures	35,883		(35,883)	-	35,174	(35,174)	-
Other financial assets	459		-	459	460	(31)	429
Restricted cash	80		-	80	684	-	684
Total non-current assets	311,050		88,227	399,277	312,234	88,911	401,145
Current assets
Trade receivables and other financial assets	8,420		(2,832)	5,588	7,975	(2,213)	5,762
Other current assets	2,261		1,019	3,280	1,944	842	2,786
Restricted cash	1,286		2,616	3,902	373	1,978	2,351
Cash	20,100		2,753	22,853	25,057	2,374	27,431
Total current assets	32,067		3,556	35,623	35,349	2,981	38,330
Asset held for sale	-		-	-	15,797	-	15,797
Total assets	343,117		91,783	434,900	363,380	91,892	455,272
Liabilities and Unitholders' equity
Liabilities
Non-current liabilities
Interest-bearing loan	204		381	585	205	73	278
Mortgage loans	-		-	-	57,993	26,516	84,509
Lease liabilities	87,226		9,539	96,765	90,682	9,810	100,492
Tenant deposits	1,710		61	1,771	2,176	62	2,238
Deferred tax liabilities	-		3,129	3,129	-	3,138	3,138
Total non-current liabilities	89,140		13,110	102,250	151,056	39,599	190,655
Current liabilities
Interest-bearing loan	73		(73)	-	26	209	235
Mortgage loans	67,417		73,586	141,003	42,623	47,275	89,898
Lease liabilities	15,173		505	15,678	12,999	270	13,269
Tenant deposits	649		280	929	-	289	289
Exchangeable securities	338		-	338	416	-	416
Trade and other payables	9,376		2,941	12,317	8,535	2,862	11,397
Provisions	277		-	277	278	-	278
Income tax payable	8,302		-	8,302	9,550	-	9,550
Deferred income	1,310		603	1,913	248	558	806
Total current liabilities	102,915		77,842	180,757	74,675	51,463	126,138

Total liabilities	192,055		90,952	283,007	225,731	91,062	316,793
Equity
Trust units	301,062		-	301,062	300,859	-	300,859
Retained earnings (2)	(179,140)		885	(178,255)	(191,908)	885	(191,023)
Accumulated other comprehensive income	29,477		(54)	29,423	29,856	(55)	29,801
	151,399		831	152,230	138,807	830	139,637
Non-controlling interest	(337)		-	(337)	(1,158)	-	(1,158)
Total liabilities and equity	343,117		91,783	434,900	363,380	91,892	455,272

Balance sheet amounts presented for the REIT were taken respectively from unaudited interim condensed financial statements as at March 31, 2026 and audited consolidated financial statements as at December 31, 2025.
The difference in retained earnings when comparing the REIT's consolidated financial statements for IFRS purposes and the REIT's financial statements for proportionate consolidation (non-GAAP) purposes relates entirely to the impairment charge recorded on the REIT's loan to Delizy in accordance with IFRS 9. As the loan to Delizy has been considered equity for proportionate consolidation purposes, no impairment under IFRS 9 has been recorded, resulting in a reconciliation difference.

‌Risks and Uncertainties

The REIT is exposed to various risks and uncertainties, many of which are beyond the control of the REIT, the occurrence of which could materially and adversely affect investments, prospects, cash flows, results of operations or financial condition and management's ability to make cash distributions to Unitholders. Management believes the risk factors described below are the most material risks to the REIT, however they are not the only ones. Additional risk factors not presently known to the REIT, or that management currently believes are immaterial, could also materially and adversely affect investments, prospects, cash flows, results of operations or financial condition and management's ability to make cash distributions to Unitholders, and negatively affect the value of the Units. In addition to the risks described herein, refere nce is made to the risks and uncertainties section in the REIT's latest Annual Information Form, which is available under the REIT's profile on SEDAR+ at https://www.sedarplus.ca.

Risks Relating to the REIT and its Business

Financing risks, leverage and restrictive covenants may limit the ability to implement the REIT's strategy

The real estate industry is capital intensive. The REIT requires access to capital to maintain its properties, as well as to fund significant capital expenditures from time to time. There is no assurance that capital will be available when needed or on favourable terms. Failure to access required capital could adversely impact investments, cash flows, operating results or financial condition, the ability to make distributions on the Units and the ability to implement the REIT's strategy.

As indebtedness increases, there is risk that the REIT may default on its debt obligations. The ability to make scheduled payments on the principal of, or interest on, and to otherwise satisfy the REIT's debt obligations depends on future performance, which is subject to the financial performance of the properties, prevailing economic conditions, prevailing interest rate levels, and financial, competitive, business and other factors, many of which are beyond the REIT's control.

The REIT is currently in breach of the restrictive covenant contained in a debt obligation relating to a Debt Service Coverage Ratio**. See the "Capital Management Financing Covenants" section. If this breach was to be enforced by the relevant lender, a portion of the REIT's indebtedness may then become immediately due and payable. If the debt under these obligations or other debt instruments is accelerated, the REIT may not have sufficient liquid assets to repay amounts due thereunder. The REIT has been in communication with the lender for the mortgage loan to refinance the loan and remediate the covenants that has been breached.

Following a comprehensive analysis by management that considered a wide range of factors related to the REIT's future cash flow and financing obligations, management has concluded that there is a material uncertainty that may cast significant doubt upon the REIT's ability to continue as a going concern for at least the next twelve months, as it requires the completion of refinancing or extension of bank loans maturing within the 12 months following the release of the financial statements.

Changes in Interest Rates Could Adversely Affect Cash Flows

When concluding financing agreements or extending such agreements, management's objective is to agree on terms for interest payments that will not impair desired profit. In addition to the variable rate portion of the leaseholds in respect of the REIT's properties, management may enter into future financing agreements with variable interest rates if the current low level of interest rates continues. As at March 31, 2026, 63% of the REIT's Total Portfolio debt was subject to variable interest rates, primarily associated with short-term financing on properties currently being marketed for sale. There is a risk that interest rates will increase, which would result in a significant increase in the amount paid by the REIT and its subsidiaries to service debt and could impact on the market price of the Units.

IFRS Reporting may Result in the Consolidated Statement of Financial Position and Consolidated Statement of Earnings Being Subject to Volatility as the Fair Value of Portfolio Changes

The fair value of the REIT's properties is dependent upon, among other things, rental income from current leases, assumptions about rental income from future leases reflecting market conditions, expected future cash outflow in respect of such leases, the demand for similar properties, the availability and cost of financing and general economic conditions. A change in one or a combination of these factors, many of which are not controlled by the REIT, may have a material impact to the fair value of i ts properties. The REIT's chosen accounting policy under IFRS requires that real estate assets be recorded at "fair value", with changes in fair value being recorded in earnings in the period of change. Accordingly, the statement of financial position and the

statement of earnings are subject to volatility, as the fair value of its real estate portfolio changes and these changes may be material.

Potential Volatility of the REIT's Unit Prices

The price for the Units could be subject to wide fluctuations in response to quarter-to-quarter variations in operating results, the gain or loss of significant properties, changes in income estimates by analysts and market conditions in the industry, as well as general economic conditions or other risk factors set out herein. In addition, stock markets have experienced volatility that has affected the market prices for many issuers' securities and that often has been unrelated to the operating performance of such issuers. These market fluctuations may adversely affect the market price of the Units. A publicly traded REIT will not necessarily trade at values determined solely by reference to the underlying value of its real estate assets. Accordingly, the Units may trade at a premium or a discount to the underlying value of the REIT's real estate assets. The market price for the Units may be affected by changes in general market conditions, fluctuations in the markets for equity securities and numerous other factors beyond the control of the REIT.

Current conditions in the French political environment may negatively impact our ability to secure financing and the value of the assets in France

France's political landscape has become more fragmented. The ongoing absence of a clear majority government has created political instability, which has significantly dampened the appetite of financial institutions for commercial lending and has tempered the appetite of potential investors, prompting them to adopt an even more conservative approach. The continuing succession of government changes has led to a tightening of lending criteria by lenders, making it increasingly difficult for businesses to secure loans. This has led to a contraction in both the supply and demand for commercial loans, as financial institutions grapple with heightened risks, businesses face higher borrowing costs, and the economy slows under the weight of this political and economic uncertainty. Transaction activity in Paris has slowed sharply, and even prime assets are experiencing reduced liquidity.

Foreign investors, traditionally a key source of capital, have been extremely cautious, temporarily pulling back from the French market. This retreat of foreign capital has further restricted the pool of funds available for commercial lending, also restricting country's business sector. The foregoing conditions may negatively impact the REIT's ability to refinance its existing loans or secure financing on terms acceptable to the REIT or at all, the value of the REIT's assets which could adversely impact the REIT's liquidity and operating results or financial condition. Furthermore, these conditions may negatively impact the ability of the REIT to sell properties if potential buyers are unable to secure financing necessary to complete the transaction.

Recent political developments and ongoing discussions around potential fiscal reforms may contribute to increased volatility in the country's economic outlook. Any related impact on France's sovereign credit rating may be subject to review by credit rating agencies, depending on how the political and fiscal landscape evolves. Together, these elements may exert upward pressure on real estate capitalization rates and could influence asset valuations across the portfolio in the coming quarters. Management will continue to monitor closely, the macroeconomic and political environment in France, which is expected to remain uncertain in the near term.

Management has reason to believe that notwithstanding the most recent external valuations received for its French properties in Q4 2025, that the market has since further deteriorated and there is no assurance that the REIT would receive the appraised value for its French properties if it were to sell these properties at this time.

Risks Inherent in the Real Estate Industry may Adversely Affect the REIT's Financial Performance

The REIT is subject to risks involving the economy in general, including, among other things, inflation, deflation or stagflation, unemployment, geopolitical events and a local, regional, national or international outbreak of a contagious disease. Poor economic conditions could adversely affect the REIT's ability to generate revenues, thereby reducing its operating income and earnings. It could also have an adverse impact on the ability of the REIT to maintain occupancy rates, which could harm the REIT's financial condition. In weak economic environments, the REIT's tenants may be unable to meet their rental payments and other obligations due to the REIT, which could have a material and adverse effect on the REIT.

In addition, fluctuation in interest rates or other financial market volatility may adversely affect the REIT's ability to refinance existing indebtedness on its maturity, or on terms that are as favorable as the terms of the existing indebtedness, which may impact negatively on AFFO, may restrict the availability of financing for future prospective purchasers of the REIT's investments, and could potentially reduce the value of such investments, or may adversely affect the ability of the REIT to complete acquisitions on financially desirable terms.

An investment in real estate is relatively illiquid. Such illiquidity will tend to limit the REIT's ability to sell its assets promptly in response to changing economic or investment conditions. The costs of holding real estate are considerable and during an economic recession, the REIT may be faced with ongoing expenditures with a declining prospect of incoming receipts. In such circumstances, it may be necessary for the REIT to dispose of properties at lower prices to generate sufficient cash for operations and making distributions and interest payments.

Concentration of Tenants May Result in Significant Vacancies on the Properties

As at March 31, 2026, five of the REIT's largest tenants, by percentage of total GLA, occupy 30% of the total area, with the main tenant in Stuttgart (held 50% in joint venture) representing 10% of total area and 12% of the Total Portfolio rental income.

While the five largest tenants in REIT Total Portfolio are committed to multi-year leases which are set to expire gradually between 2027 and 2031, there is no assurance that such tenants will continue to occupy such premises for the remainder of their lease terms. Some of them have break options before the end of their leases, and the earliest dates on which those five largest tenants may effectively move range between 2026 and 2031.

To minimize further risk of vacancy, the REIT will continue to closely monitor all leases and ensure that they work with the current tenants to determine their future leasing plans, which would allow the REIT to source tenants in advance of the current tenants' vacating the property.

Lease Renewals, Rental Increases, Lease Termination Rights and Other Lease Matters

Leases for tenants of the REIT's properties will mature or expire from time to time. There can be no assurance that tenants will renew their leases upon the expiration or that rental rate increases will be achieved upon such renewal. The failure to renew leases or achieve rental rate increases may adversely impact our financial condition and results of operations and decrease the amount of cash available for distribution.

Despite management's objective to maintain continuous occupancy of leased premises, tenants may fall into financial difficulty from time to time, and there can be no guarantee that tenants will continue to occupy such premises, nor be able to fully pay their rent. In addition, certain leases contain a provision which gives tenants the right to terminate their leases upon payment of a penalty.

Environmental Contamination on Properties May Expose the REIT to Liability and Adversely Affect Financial Performance

The properties may contain ground contamination, hazardous substances, wartime relics (including potentially unexploded ordnance) and/or other residual pollution and environmental risks. Buildings and their fixtures might contain asbestos or other hazardous substances above the allowable or recommended thresholds, or the buildings could bear other environmental risks. Prior to acquiring interests in the properties (including the leasehold interests), management undertook environmental studies on each property. No sign of pollution was evidenced on any of the properties.

The REIT is subject to various federal, state, and municipal laws relating to environmental matters. Such environmental laws impose actual and contingent liabilities on the REIT to undertake remedial action on contaminated sites and in contaminated buildings. The costs of any removal, investigation, or remediation of any residual pollution on such sites or in such buildings, as well as costs related to legal proceedings, including potential damages, regarding such matters may be substantial.

The REIT has insurance in place to protect against certain environmental liabilities in respect of certain of the properties, with limits, which are customary and available for portfolios like the REIT's.

Necessary capital and operating expenditures are made to ensure compliance with environmental laws and regulations. Although there can be no assurance, management does not believe that costs relating to environmental matters will have

a material adverse effect on our investments, financial condition, results of operations or distributions or cash interest payments. However, environmental laws and regulations can change, and the REIT may become subject to more stringent environmental laws and regulations in the future. Compliance with more stringent environmental laws and regulations could have an adverse effect on the REIT's business, financial condition or results of operations.

The REIT May Incur Significant Capital Expenditures

Certain significant expenditures must be made throughout the period of ownership of real property, regardless of whether the property is producing sufficient income to pay such expenses. To retain desirable rentable space and to generate adequate revenue over the long term, we must maintain or, in some cases, improve each property's condition to meet market demand, which can entail significant costs that may not be passed on to tenants.

Any failure by the REIT to undertake appropriate maintenance and refurbishment work in response to the factors described above could entitle tenants to withhold or reduce rental payments, or even to terminate existing leases. Any such event could have a material adverse effect on our cash flows, financial condition and results of operations, and our ability to make distributions on the Units.

Changes in Government Regulations May Affect Our Investment in Our Properties

The REIT is subject to laws and regulations governing the ownership, leasing or operations of, or investment in, real property, employment standards, environmental and energy efficiency matters, taxes and other matters. It is possible that future changes in applicable federal, state, local or common laws or regulations or changes in their enforcement or regulatory interpretation could result in changes in the legal requirements affecting the REIT (including with retroactive effect), and in particular, those applicable in France, Germany and Spain (in which all of our properties are located). Any changes in the laws to which the REIT is subject could materially affect its rights and title to the properties in its portfolio. It is not possible to predict whether there will be any further changes in the regulatory regime(s) to which the REIT is subject or the effect of any such change on investments by the REIT.

In France, certain authorities or individuals (for example, tenants or the administrative agency governing the area in which the subject property is located) have a pre-emptive right, under law, to purchase a property in priority to a potential purchaser (referred to in France as the Droit de Preemption). These pre-emptive rights may negatively impact proposed sales by the REIT, for example, by creating delays in the sale process and causing a reduction in the price to be paid for the REIT's properties.

Failure to Receive Deductions for Interest Payments May Adversely Affect Cash Flows, Results of Operations and Financial Condition

During the acquisition of its properties, the REIT entered into financing transactions with third parties and affiliates. These financing agreements require payment of principal and interest. There are several rules pursuant to German and Luxembourg tax laws restricting the tax deductibility of interest expenses for corporate income and municipal trade tax purposes. Such rules have been changed considerably on several occasions recently. As a result, uncertainties exist as to the interpretation and application of such rules, which have not yet been clarified by the tax authorities and the tax courts. The tax deductibility of interest expenses depends on, among other things, the details of the security structure for debt financings, the annual amount of tax net-debt interest, the amounts and terms of Unitholder or affiliate financings, and our general tax structure. There is a risk of additional taxes being triggered on the rental income and capital gains in the event that the tax authorities or the tax courts adopt deviating views on the above. If this were the case, this would result in a higher tax burden and, consequently, could have a material adverse effect on cash flows, financial condition and results of operations and ability to pay distributions on the Units. In France, and assuming that interest rates on group loans are arm's length, tax laws restricting the deductibility of interest expenses for corporate income tax purposes should have no impact since INOPCI 1 is exempt from corporate income tax provided it complies with its distribution obligations.

Changes in Currency Exchange Rates Could Adversely Affect Our Business

Substantially all of the REIT's investments and operations are conducted in currencies other than Canadian dollars (mostly in Euros). The REIT raises funds primarily in Canada from the sale of securities in Canadian dollars and invests such funds indirectly through its subsidiaries in currencies other than Canadian dollars. As a result, fluctuations in such foreign currencies

against the Canadian dollar could have a material adverse effect on financial results, which are denominated and reported in Canadian dollars, and on the ability to pay cash distributions to Unitholders, if any. When needed, active hedging programs have been implemented to offset the risk of revenue losses if the Canadian dollar increases in value compared to foreign currencies. However, to the extent that the REIT fails to adequately manage this risk, including if any such hedging arrangements do not effectively or completely hedge changes in foreign currency rates, the REIT's financial results may be negatively impacted.

Dependence on Inovalis S.A. for Management Services

The REIT is dependent on Inovalis S.A. with respect to the asset management of properties and the property management of the properties. Consequently, the REIT's ability to achieve its investment objectives depends in large part on Inovalis S.A. and its ability to provide advice. This means that the REIT's investments are dependent upon Inovalis S.A.'s business contacts, its ability to successfully hire, train, supervise and manage its personnel and its ability to maintain its operating systems. If the REIT were to lose the services provided by Inovalis S.A. or its key personnel, our investments may decline. The REIT may be unable to duplicate the quality and depth of management available to it by becoming a self-managed company or by hiring another asset manager.

While the trustees have similar oversight responsibility with respect to the services provided by Inovalis S.A. pursuant to the Management Agreement, the services provided by Inovalis S.A. are not performed by employees of the REIT, but by Inovalis S.A. directly and through entities to which it may subcontract. The Management Agreement's three-year term ended on March 31, 2026, and has been renewed for one year.

Investments in, and Profits and Cash Flows From, Properties May be Lost in the Event of Uninsured or Underinsured Losses to Properties or Losses from Title Defects

The REIT carries general liability, umbrella liability and excess liability insurance with limits that are typically obtained for similar real estate portfolios in France, Germany and Spain and otherwise acceptable to the trustees. For the property risks, the REIT intends to carry "Multi-Risk" property insurance, including but not limited to, natural catastrophic events and loss of rental income insurance (with at least a 12 to 18-month indemnity period). The REIT also carries boiler and machinery insurance covering all boilers, pressure vessels, HVAC systems and equipment breakdown. There are, however, certain types of risks (of a catastrophic nature such as from pandemics, war, or nuclear accidents) that are uninsurable under any insurance policy. Furthermore, there are other risks that are not economically viable to insure currently. The REIT partially self-insures against terrorism risk for the entire portfolio. The REIT has insurance for earthquake risks, subject to certain policy limits, deductibles and self-insurance arrangements. Should an uninsured or underinsured loss occur, the REIT could lose the investment in, and anticipated profits and cash flows from, one or more of its properties, but it would continue to be obligated to repay any recourse mortgage indebtedness on such properties. The REIT does not carry title insurance on the properties. If a loss occurs resulting from a title defect with respect to a property where there is no title insurance, the REIT could lose all or part of its investment in, and anticipated profits and cash flows from, such property. The REIT does not carry pandemic insurance on the properties. If a loss occurs resulting from the inability of a tenant to pay rent, or a restriction on the operation of a property due to government regulation related to a pandemic, the REIT could lose all or part of its investment in, and anticipated profits and cash flows from, such property.

Reliance on Partnerships

The REIT has a material non-controlling interest in joint venture partnerships with several institutional investors. These arrangements create a risk as the business objectives or economic interests of the partner, as in any joint business arrangement, may not be aligned with those of the REIT. The partner may make decisions that negatively affect the value of its real estate assets or income of the REIT. Such investments may involve risks that are not present in investments where a third party is not involved, including the possibility that a partner may have financial difficulties, resulting in a negative impact on the investment, or be liable for the actions of its third-party partner. Although the REIT may not have control over these investments and therefore may have a limited ability to protect its position, such partnership arrangements contain terms and conditions which, in the opinion of the REIT's independent trustees, are commercially reasonable, including without limitation such terms and conditions relating to restrictions on the transfer, acquisition and sale of the REIT's and any joint

venture partner's interest in the joint venture arrangement, provisions to provide liquidity to the REIT, provisions to limit the liability of the REIT and its Unitholders to third parties, and provisions to provide for the participation of the REIT in the management of the joint venture arrangements. The REIT's investment in properties through joint arrangements is subject to the investment guidelines set out in the Declaration of Trust.

Climate Change Risk

Climate change continues to attract the focus of governments and the general public as an important threat, given the emission of greenhouse gases and other activities which continue to negatively impact the planet. The REIT faces the risk that its properties will be subject to government initiatives aimed at countering climate change, such as reduction of greenhouse gas emissions, which could impose constraints on its operational flexibility. Furthermore, the REIT's properties may be exposed to the impact of events caused by climate change, such as natural disasters and increasingly frequent and severe weather conditions. Such events could interrupt the REIT's operations and activities, damage its properties, and require the REIT to incur additional expenses, including an increase in insurance costs to insure its properties against natural disasters and severe weather.

Potential Conflicts of Interest

The REIT may be subject to various conflicts of interest because of the fact that the trustees and management (being engaged through Inovalis S.A.), and their associates, may be engaged in a wide range of real estate and other business activities. The REIT may become involved in transactions which conflict with the interests of the foregoing. The trustees, management, Inovalis S.A., and their associates or affiliates may from time to time deal with persons, firms, institutions or corporations with which the REIT may be dealing, or which may be seeking investments similar to those desired by the REIT. The interests of these persons could conflict with those of the REIT.

Cyber Security Risks

Cyber security has become an increasingly problematic issue for issuers and businesses around the world, including for the REIT and the real estate industry. Cyber-attacks against large organizations are increasing in sophistication and are often focused on financial fraud, compromising sensitive data for inappropriate use or disrupting business operations. Such an attack could compromise the REIT's confidential information as well as that of the REIT's employees, tenants and third parties with whom the REIT interacts and may result in negative consequences, including remediation costs, loss of revenue, additional regulatory scrutiny, litigation and reputational damage. As a result, the Asset Manager continually monitors for malicious threats and adapts accordingly in an effort to ensure it maintains privacy and security standards. The Asset Manager, pursuant to the Management Agreement, invests in cyber-defense technologies to support the REIT's business model and to protect its systems, employees and tenants and seeks to employ industry best practices. The REIT's investments continue to manage the risks it faces today and position the REIT for the evolving threat landscape. The REIT also follows certain protocols when it engages software and hardware vendors concerning data security and access controls.

Litigation Risks

The REIT is subject to a wide variety of laws and regulations across its operating jurisdictions and faces risks associated with legal changes and litigation. If the REIT fails to monitor and become aware of changes in applicable laws and regulations, or if the REIT fails to comply with these changes in an appropriate and timely manner, it could result in fines and penalties, litigation or other significant costs, as well as significant time and effort to remediate any violations. The REIT, in the normal course of operations, is subject to a variety of legal and other claims, including claims relating to personal injury, property damage, property taxes, land rights and contractual and other commercial disputes . The final outcome with respect to outstanding, pending or future actions cannot be predicted with certainty, and the resolution of such actions may have an adverse effect on the REIT's financial position or results of operations as well as reputational damage both from an operating and an investment perspective. The REIT evaluates all claims on their apparent merits and accrues management's best estimate of the likely cost to satisfy such claims. Management believes the outcome of current legal and other claims filed against the REIT, after considering insurance coverage, will not have a significant impact on the REIT's consolidated financial statements.

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Inovalis Real Estate Investment Trust published this content on May 12, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 12, 2026 at 21:32 UTC.

Market Closed - Toronto S.E. Other stock markets 02:40:51 2026-06-12 pm EDT			5-day change	1st Jan Change
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May. 12	Earnings Flash (INO-UN.TO) Inovalis REIT Reports Q1 Net Rental Income $4.149M Vs $5M a Year Earlier	MT
May. 12	Inovalis Real Estate Investment Trust Reports Earnings Results for the First Quarter Ended March 31, 2026	CI

May. 12	Earnings Flash (INO-UN.TO) Inovalis REIT Reports Q1 Net Rental Income $4.149M Vs $5M a Year Earlier	MT
May. 12	Inovalis Real Estate Investment Trust Reports Earnings Results for the First Quarter Ended March 31, 2026	CI
Mar. 25	Earnings Flash (INO-UN.TO) Inovalis REIT Says For Investment Property Portfolio Including Assets Owned Entirely By It, Net Rental Income for Q4 2025 Decreased	MT
Mar. 25	Inovalis REIT Brief: Q4 FFO Per Unit Diluted ($0.20) and AFFO Per Unit Diluted ($0.23)	MT
Mar. 25	Inovalis Real Estate Investment Trust Reports Earnings Results for the Fourth Quarter and Full Year Ended December 31, 2025	CI
Mar. 24	Inovalis Real Estate Investment Trust Auditor Raises 'Going Concern' Doubt	CI
Mar. 09	Inovalis REIT Provides Update on Arcueil Withholding Tax Matter	MT
Mar. 06	Inovalis Real Estate Investment Trust provides update on Arcueil withholding tax matter and appeal	RE
Feb. 02	Inovalis REIT Closes Disposition of the Trio Property	MT
Jan. 30	Inovalis Real Estate Investment Trust announces closing of the disposition of the Trio Property	RE
Jan. 29	An undisclosed buyer completed the acquisition of Trio Property from Inovalis Real Estate Investment Trust (TSX:INO.UN) and Inovalis.	CI
Dec. 23	Inovalis Real Estate Investment Trust closes EUR14.0 million sale of Baldi property	RE
Dec. 22	An undisclosed buyer acquired Baldi property from Inovalis Real Estate Investment Trust (TSX:INO.UN) for ?14 million.	CI
Dec. 15	Inovalis Real Estate Investment Trust Announces A Cash Distribution, Payable on December 31, 2025 and January 15, 2026	CI
Nov. 12	Inovalis Real Estate Investment Trust Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2025	CI

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