Press release

Zürich, 1 February 2017 - Peach Property Group has lifted its profits substantially in 2016 according to preliminary, unaudited figures. Earnings before taxes in the past financial year are expected to total around CHF 15 million, a significant increase compared to the previous year's earnings of CHF 3.3 million. The sale of properties but also higher rental income and valuation increases of investment properties have led to this marked increase. The figures are proof of the successful further implementation of the strategy of value-added portfolio management focusing on German residential properties. At the same time, operating costs were cut once again in 2016 by around 8 percent, and the financing structure was improved substantially.

According to preliminary figures, rental income increased in 2016 by around 7 percent to almost CHF 9.2 million despite properties being sold in the amount of more than CHF 120 million. The increase in target rental income on an annualized basis is significantly higher, up 39 percent year-on-year to CHF 16.3 million as the newly acquired residential portfolio in Kaiserslautern has only been consolidated since December 2016. This portfolio comprises 895 apartments and 12 commercial units. This new portfolio in Kaiserslautern alone will earn annual rental income of around CHF 4.4 million.

The sale of the Gretag site in Switzerland and the commercial Erkrath Retail property in Germany generated substantial funds in 2016. During the past financial year these funds were largely invested in the acquisition of a total of four residential portfolios in Germany, expanding the properties under management by more than 1,600 apartments to a current total of around 3,150 units. This means that the portfolio has more than doubled compared to the end of 2015, when it totaled 1,522 apartments. The total rental space in the portfolio thus increased in 2016 to almost 250,000 square meters, compared to around 164,000 square meters in the previous year. The market value of the investment portfolio increased in 2016 to around CHF 225 million after CHF 219 million at the end of 2015.

Additional funds in the amount of CHF 25 million were raised through the full placement of the hybrid bond listed on SIX Swiss Exchange (PEA15, ISIN CH0305711647). This increase further reinforced the equity base. In addition, the liabilities and financing costs were cut significantly in 2016 as a result of the scheduled repayment of the corporate bond of the German subsidiary Peach Property Group (Deutschland) AG, which bore interest of 6.6 percent per annum. This bond had a nominal amount of EUR 50 million and its most recent outstanding volume totaled EUR 46.7 million. The Group has repaid this amount from operating funds without taking out any new borrowing. As a result of the bond repayment and the sale of the Gretag and Erkrath Retail properties interest expense fell by more than 20 percent during the course of 2016. The equity ratio (IFRS) as of 31 December 2016 increased substantially to over 40 percent compared to 31 percent at the end of the previous year. This ratio benefited from the positive course of business, the increase in the hybrid bond and the reduction in financial liabilities mentioned above.

Peach Property Group is confident that it will continue its profitable growth in the current fiscal year 2017. The focus continues to be on expanding the portfolio with residential properties in B cities in Germany, as well as optimising and increasing the value of the existing investment properties. The development project "Wollerau Park" in Switzerland will be completed in the first quarter of 2018 and the proportion of development projects will further decrease significantly. At present, almost 70 percent of the apartments have been sold and construction work is making good progress.

Dr. Thomas Wolfensberger, Peach Property Group's CEO, commented: "We have continued our successful transformation to become an established residential real estate investment investor in Germany during the past fiscal year. At the end of 2016 investment properties accounted for around 75 percent of our total portfolio. At present we are taking a very close look at additional portfolio acquisitions in Germany, and are expecting our investment portfolio to reach around 5,000 apartments in the short to medium term. This will also lead to a further substantial increase in rental income."

The final financials and additional information on the course of business will be published on 21 March 2017.

Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer

+41 44 485 50 00 | investors@peachproperty.com

Media Germany

edicto GmbH, Axel Mühlhaus, Peggy Kropmanns

+49 (0) 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG

Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

For more information, see www.peachproperty.com