Obbligazione Covivo SA 1.625% ( XS1698714000 ) in EUR

Covivo SA

100 EUR ▼

Francia

XS1698714000 ( in EUR )

1.625% per anno ( pagato 1 volta l'anno)

17/10/2024 - Obbligazione è scaduto

Prospetto opuscolo dell'obbligazione Covivio S.A XS1698714000 in EUR 1.625%, scaduta

Covivio S.A. è una società immobiliare europea leader nel settore degli investimenti e della gestione di proprietà commerciali, alberghiere e residenziali, con un portafoglio diversificato in principali mercati europei.

L'obbligazione con codice ISIN XS1698714000, un titolo di debito emesso dalla francese Covivio S.A., primaria società immobiliare europea, caratterizzata da una cedola annuale fissa dell'1.625% e denominata in Euro, è giunta a naturale scadenza il 17 ottobre 2024 ed è stata integralmente rimborsata alla pari, ovvero al 100% del suo valore nominale.

Beni Stabili S.p.A. Siiq
(incorporated with limited liability under the laws of the Republic of Italy)
300,000,000
1.625 per cent. Notes due 17 October 2024
The issue price of the 300,000,000 1.625 per cent. Notes due 17 October 2024 (the "Notes") of Beni Stabili S.p.A. Siiq (the Issuer or Beni Stabili) is 99.47 per
cent. of their principal amount.
Unless previously redeemed or cancelled, the Notes will be redeemed at their principal amount on 17 October 2024. The Notes are subject to redemption, in whole
but not in part, at their principal amount, plus interest, if any, to the date fixed for redemption in the event of certain changes affecting taxation in the Republic of
Italy and redemption, in whole and in part, at the Make Whole Amount (as defined in Condition 6) at the option of the Issuer at any time. In addition, the holder of a
Note may, by the exercise of the relevant option, require the Issuer to redeem or, at the Issuer's option, purchase such Note at 100 per cent. of its principal amount
together with accrued and unpaid interest (if any) to (but excluding) the Put Date upon the occurrence of a Put Event (each as defined below). See "Terms and
Conditions of the Notes -- Redemption and Purchase".
The Notes will bear interest from 17 October 2017 (the Issue Date) at the rate of 1.625 per cent. per annum payable annually in arrear on 17 October each year
commencing on 17 October 2018. Payments on the Notes will be made in Euro without deduction for or on account of taxes imposed or levied by the Republic of
Italy to the extent described under "Terms and Conditions of the Notes Taxation".
The Notes will constitute senior, unsecured obligations of the Issuer which will at all times rank pari passu among themselves and at least pari passu with all other
present and future unsecured obligation of the Issuer, save for certain mandatory exceptions of applicable law.
Application has been made to the Commission de Surveillance du Secteur Financier (the CSSF) in its capacity as competent authority under the Luxembourg Act
dated 10 July 2005, as amended (the Luxembourg Prospectus Act) relating to prospectuses for securities, for the approval of this Prospectus for the purposes of
Directive 2003/71/EC (as amended, including by Directive 2010/73/EU) (the Prospectus Directive). Pursuant to Article 7(7) of the Luxembourg Prospectus Act, by
approving this prospectus, the CSSF gives no undertaking as to the economic and financial soundness of the Notes to be issued hereunder and the quality or
solvency of the Issuer. Application has also been made to the Luxembourg Stock Exchange for the Notes to be listed on the official list of the Luxembourg Stock
Exchange (the Official List) and to be admitted to trading on the Luxembourg Stock Exchange's regulated market. References in this Prospectus to the Notes being
"listed" (and all related references) shall mean that the Notes have been listed on the Official List and admitted to trading on the Luxembourg Stock Exchange's
regulated market. The Luxembourg Stock Exchange's regulated market is a regulated market for the purposes of Directive 2004/39/EC of the European Parliament
and of the Council on markets in financial instruments.
The Issuer has been rated BBB- by Standard & Poor's Credit Market Services Europe Limited (S&P). The Notes will be rated BBB- by S&P. S&P is established in
the European Union and is registered under the Regulation (EC) No. 1060/2009 (as amended) (the CRA Regulation). As such, S&P is included in the list of credit
rating agencies published by the European Securities and Markets Authority on its website (at http://www.esma.europa.eu/page/List-registered-and-certified-CRAs)
in accordance with the CRA Regulation. A security rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or
withdrawal at any time by the assigning rating agency.
The Notes have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the Securities Act) and are subject to United States
tax law requirements. The Notes are being offered outside the United States by the Joint Lead Managers (as defined in "Subscription and Sale") in accordance with
Regulation S under the Securities Act (Regulation S), and may not be offered, sold or delivered within the United States or to, or for the account or benefit of, U.S.
persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. For a description of certain
restrictions on transfers of the Notes, see "Subscription and Sale".
Investing in the Notes involves risks. See "Risk Factors" beginning on page 2 of this Prospectus for a discussion of certain risks prospective investors
should consider in connection with any investment in the Notes.
The Notes will be in bearer form in the denomination of 100,000 each and, for so long as the Notes are represented by a Global Note (as defined below) and
Euroclear Bank SA/NV (Euroclear) and Clearstream Banking S.A. (Clearstream, Luxembourg) (or other relevant clearing system) allow, in denominations of
1,000 in excess of 100,000, up to and including 199,000. The Notes will initially be in the form of a temporary global note (the Temporary Global Note),
without interest coupons, which will be deposited on or around the Issue Date with a common safekeeper for Euroclear and Clearstream, Luxembourg. The
Temporary Global Note will be exchangeable, in whole or in part, for interests in a permanent global note (the Permanent Global Note, and together with the
Temporary Global Note, each a Global Note), without interest coupons, not earlier than 40 days after the Issue Date upon certification as to non-U.S. beneficial
ownership. Interest payments in respect of the Notes cannot be collected without such certification of non U.S. beneficial ownership. The Permanent Global Note
will be exchangeable in certain limited circumstances in whole, but not in part, for Notes in definitive form in principal amounts equal to 100,000 and integral
multiples of 1,000 in excess thereof, up to and including 199,000, each with interest coupons attached. No Notes in definitive form will be issued with a
denomination above 199,000. See "Overview of Provisions Relating to the Notes in Global Form".
JOINT LEAD MANAGERS
Banca IMI
BNP Paribas
Crédit Agricole CIB
Société Générale Corporate & Investment Banking
UniCredit Bank
Prospectus dated 13 October 2017

TABLE OF CONTENTS
RISK FACTORS ......................................................................................................................................................... 2
IMPORTANT NOTICES ...........................................................................................................................................14
INFORMATION INCORPORATED BY REFERENCE...........................................................................................18
TERMS AND CONDITIONS OF THE NOTES .......................................................................................................20
OVERVIEW OF PROVISIONS RELATING TO THE NOTES IN GLOBAL FORM .............................................38
USE OF PROCEEDS ................................................................................................................................................40
DESCRIPTION OF THE ISSUER ............................................................................................................................41
TAXATION ...............................................................................................................................................................70
SUBSCRIPTION AND SALE ...................................................................................................................................79
GENERAL INFORMATION ....................................................................................................................................81

1

RISK FACTORS
Any investment in the Notes is subject to a number of risks. Prior to investing in the Notes, prospective investors
should carefully consider risk factors associated with any investment in the Notes, the business of the Issuer and its
consolidated subsidiaries (together the Group or the Beni Stabili Group) and the industry in which it and the
Group operates together with all other information contained in this Prospectus, including, in particular, the risk
factors described below. Words and expressions defined in the "Terms and Conditions of the Notes" below or
elsewhere in this Prospectus have the same meanings in this section.
The following is a list of risks which are specific to the situation of the Issuer and/or the Notes and which investors
may face when making an investment in the Notes and should be used as guidance only. Additional risks and
uncertainties relating to the Issuer that are not currently known to the Issuer or that it currently deems immaterial,
may individually or cumulatively also have a material adverse effect on the business, prospects, results of
operations and/or financial position of the Issuer and/or its Group and, if any such risk should occur, the price of
the Notes may decline and investors could lose all or part of their investment. Investors should consider carefully
whether an investment in the Notes is suitable for them in light of the information in this Prospectus and their
personal circumstances.
Factors that may affect the Issuer's ability to fulfil its obligations under the Notes
Risks relating to the Beni Stabili Group
Risks linked to the environment in which Beni Stabili operates
Risks linked to the economic environment
Changes in domestic or international economic conditions (economic growth, interest rates, unemployment rate,
calculation, method for rent indexation, changes in various indices, etc.) may have a significant negative impact on
the business of the Beni Stabili Group and its financial results. The Beni Stabili Group could experience a
downturn in demand for corporate real estate projects, a drop in the occupancy rate and in the leasing or re-leasing
price of its real estate properties, and a decline in the valuation of its portfolio.
Risks linked to changes in real estate market
The Italian and international real estate markets are subject to cyclical trends and are influenced by a series of
macroeconomic factors. Market demand and supply are affected by, amongst other things, general economic
conditions, interest rate fluctuations, inflation trends, tax regimes, market liquidity and alternative investment
opportunities.
The Beni Stabili Group operates primarily in the office property sector in Italy. The value of the Group's portfolio
depends on the performance of the market in which it operates as well as on the evolution of the macro
environment, legislation and tax regulations. It may fluctuate, particularly with respect to rental income and
property values in light of the supply/demand balance and the overall economic situation. The Beni Stabili Group
may not be in a position to carry out its rental or leasing strategy, its investments and, where applicable, its
disposals at a favourable time or under favourable market conditions. It may be forced to defer or change such
strategy and investments depending on the fluctuations in the property market.
Although the Group pursues an investment strategy aimed at minimising the impact of the economic cycle, an
extended period of economic downturn or the occurrence of other factors that negatively impact real estate values
could have an adverse effect on the Group's financial condition and results of operations.

2

Competition risks
Within the context of its development, the Beni Stabili Group is in competition with numerous players that have a
more significant financial basis that allows them to respond to financial terms that do not necessarily correspond
with the investment criteria the Beni Stabili Group has set for itself. The Group's rental activity is also subject to
strong competitive pressure. As a whole, these factors could lead to uncertainty in relation to the Group's growth
forecasts and have a negative impact on its business, its financial condition and its results of operations.
Risks linked to the scope and type of business of the Group
The geographical concentration of the Group's property assets may have a negative impact on its business
The Group operates wholly in the Italian market, with its property assets concentrated primarily in northern Italy,
and is therefore particularly exposed to the trends of the local economy.
As at 30 June 2017, the majority of the Group's portfolio of properties by market value was located in northern
Italy, and especially in Milan and Rozzano, with approximately 62 per cent. of the overall value of its properties
concentrated in such areas. The second largest city in terms of concentration is Turin, where, as at 30 June 2017, 6
per cent. of the properties were located while the third largest city is Rome where, as at 30 June 2017, 5 per cent. of
the properties were located. Furthermore, 91 per cent. of the portfolio is composed of office properties whereas
9 per cent. of the portfolio is composed of retail and other buildings. All the above percentages are calculated on a
group share basis1 (referred to in this Prospectus as Group Share basis).
Consequently, the Group's results of operations and the value of its property portfolio could be negatively affected
by a worsening of the local economy or of the local real estate market in the Italian cities where the Group's real
estate assets are concentrated. This exposes the Group to specific local risks in relation to changes in the local
economy and local politics and/or planning laws, which cannot easily be predicted and which could have an
adverse effect on the Group's financial condition and results of operations.
Risks related to renewal of leases and letting of real estate assets
Upon expiration of existing leases, the Group may not be in a position to renew them under equivalent terms or to
lease the assets within a reasonable time frame, particularly due to macroeconomic and real estate market
conditions. The Group may fail to succeed in maintaining its occupancy rate and its rental income, which would
have an adverse impact on its financial condition and results of operations.
The Group is primarily dependent on a limited number of tenants for its rental revenues
As at 30 June 2017, the Group's annual rental income generated from its top four tenants accounted for
approximately 55 per cent. of the Group's total rental income on a Group Share basis (63 per cent. on a
consolidated basis). Among these four main tenants (Telecom Italia S.p.A., Intesa Sanpaolo S.p.A., Maire
Technimont S.p.A. and the Italian public administration), Telecom Italia alone accounted for approximately 34 per
cent of the Group's total rental income on a Group Share basis (46 per cent. of the Group's consolidated total rental
income). The Issuer's management constantly monitors the creditworthiness of these main tenants. Nonetheless,
an extended period of economic downturn could result in a material breach of contract by one or more of these or
other tenants or a worsening of their creditworthiness or their capacity to fulfil their rental obligations, which could
have an adverse effect on the Group's financial condition and results of operations.

1 The Issuer calculates the "group share" by taking into account the participation into Central SICAF at the current stake of 60% and assuming
completion of the contribution to Central SICAF of the remaining five Telecom Italia Portfolio buildings.

3

The Group is exposed to credit risk arising from its commercial activity
Credit risk represents the Group's exposure to potential losses that could be incurred if a counterparty fails to meet
its obligations. This risk arises primarily from economic and financial factors (i.e., where the counterparty defaults
on its obligations), as well as from factors that are technical, commercial, administrative or legal in nature.
The Group's exposure to credit risk is due mainly to the concentration of its commercial relationships with four
major tenants (see "The Group is primarily dependent on a limited number of tenants for its rental revenues"
above).
Material defaults by major tenants or financial counterparties, or a significant increase in current default rates by
counterparties generally, could have an adverse effect on the Group's financial condition and results of operations.
As at 30 June 2017, receivables from tenants, before the related provision for write-downs, totalled 50,856
thousand (including receivables for invoices to be issued totalling 21,960 thousand, which were recorded pursuant
to the rules of IAS 17 in order to even out the overall contractual compensation over the term of the lease). Of this
amount, about 17,516 thousand was more than 12 months overdue. Moreover, the provision for receivable
write-downs as at 30 June 2017 totalled about 19,518 thousand.
For additional information on credit risk from the Issuer's business, see the unaudited consolidated half-year
financial statements of the Issuer for the six months ended on 30 June 2017 and specifically Paragraph 3.1 of the
Notes to the Financial Statements on pages 61 to 73, which are incorporated by reference in this Prospectus.
Credit recovery expectations are assessed on a position-by-position basis, taking into account existing validly
enforceable guarantees and opinions of external counsel in respect of any relevant recovery actions. The operating
and financial performance of the Group's more important tenants are monitored on an ongoing basis, with bank
sureties and guarantee deposits provided by tenants securing more than one quarter of the aggregate amount of
annual rentals as at 30 June 2017. However, assessments of creditworthiness are based on the information
available at the time and could be adversely affected by market or general economic conditions, and could
ultimately have a material adverse impact on the Group's financial condition and results of operations.
The Group is exposed to fluctuating property values
Since investment properties, properties held for sale and, where applicable, properties under development are
measured at fair value and the relative fluctuations are accounted for in the Group's income statement, movements
in property prices can have a significant impact on the Group's operating performance. Furthermore, part of the
Group's operating results derive from property trading, which is also significantly influenced by property value
trends and the volume of transactions. Rents and property values are cyclical in nature, and are influenced by
macroeconomic factors such as interest rates, liquidity and economic growth. The Group's investment policy aims
to minimise the impact of different stages of the cycle through a careful selection of investments that offer
long-term leases with creditworthy tenants, strategic locations in cities that have a structural shortage of good
quality office space and low vacancy rates. Purchases and sales of properties in the Group's trading portfolio are
carefully monitored both to minimise risk and to exploit opportunities. However, fluctuations in property values
are largely out of the control of the Group and could have a material adverse impact on the Group's financial
condition and results of operations.
The Group may not be successful in completing development projects as planned, or on commercially
favourable terms
The Group has invested in development assets, currently representing approximately 10 per cent. of its total
portfolio. As at the date of this Prospectus, the Group's main development projects include the development of two
disused industrial areas, the renovation of another three existing properties in Milan (the Symbiosis Area in Milan
(formerly called "Ripamonti"), the property in Via Schievano, and the buildings in Via Cernaia, Via Colonna,

4

Piazza Monte Titano and Via Principe Amedeo) and the refurbishment of an existing building complex in Turin,
C.so. Ferrucci (for further information, see the section headed "Description of the Issuer - Business Overview of the
Beni Stabili Group" below).
Development projects may require substantial capital expenditure, and it usually takes a considerable amount of
time before projects are completed and begin generating income. Certain general risks affect development and
refurbishment activities, including risks relating to completion, the possibility of construction overruns (both in
terms of time and budget), the risk of not obtaining, or delays in obtaining, necessary administrative permits,
statutory consents and planning permissions and risks relating to the financing of the development. Inaccurate
assessment of a development opportunity or a decrease in tenant demand due to competition from other
commercial real estate properties or adverse market conditions, could result in a substantial proportion of the
development remaining vacant after completion and exert pressure on the Group to provide rental or capital
incentives to tenants or purchasers.
In addition, there are risks associated with (i) the failure to obtain title to property, and (ii) failure by third parties,
including failure to complete a compulsory purchase order by a local authority. In addition, the Group may
become subject to obligations under development agreements giving rise to additional expenditure commitments.
Any of these factors could increase the cost of, or could delay or prevent completion of, a project and/or could
result in a delay or loss of revenues or of capital invested. In addition, overruns on any new or existing
developments (or the insolvency of contractors or failure of contractors to perform obligations) may have an
adverse impact on the financial viability of the scheme and may lead to the need for additional funding.
Consequently, there can be no assurance that the existing or future development of property by the Group will not
have an adverse effect on the Group's business, financial condition and/or results of operations.
The Group's success depends on attracting and retaining key personnel
The Group's success depends, to a significant extent, on the continued services of its executive management team,
which has substantial experience in the property industry. In addition, the Group's ability to continue to identify
and develop properties depends on the management's knowledge of, and expertise in, the property market. There
is no guarantee that the executive management team will remain employed by the Group. The sudden and/or
unanticipated loss of the services of one or more members of the executive management team could have an
adverse effect on the Group's business, financial condition and/or results of operations which could, in turn, have a
material adverse impact on the ability of the Issuer to meet its obligations under the Notes and/or its obligations
under its other financial indebtedness.
Legal, fiscal, regulatory, environmental and insurance risks
The Group's business and results of operations could be negatively affected by changes in the legislative,
regulatory and fiscal framework in Italy and at a European level
The Group's activities are subject to a number of building, health and safety and planning legislation and
regulations (at both a national and regional level), environmental laws and regulations (at the European
Community level), landlord-tenant legislation, and specific tax regimes. Increased capital expenditure and
operating costs resulting from future laws and regulations, amendments to applicable tax rates and regimes,
changes in the regulations on commercial leases and changes in environmental regulations could adversely affect
the Group's results of operations and financial condition. The failure to comply with the requisite standards and
regulations in relation to any particular property may adversely affect such property's value and/or result in
increased costs to be borne by the Group in order to remedy such non-compliance, which in turn could have an
adverse effect on the Group's financial condition and results of operations.

5

The Group may be liable for environmental issues relating to its current and former operations and properties
The Group may be liable for the costs of removal, investigation or remediation of hazardous or toxic substances
located on or in a property owned by or leased to it at a particular time, or any property formerly owned by it but
subsequently disposed of. The costs of any required removal, investigation or remediation of such substances may
be substantial. The presence of such substances, or the failure to remediate such substances properly, may also
adversely affect the Group's ability to sell or lease the real estate or to borrow using the real estate as security.
Whilst the Group has generally not provided contractual representations regarding environmental liabilities when
selling properties in recent years, laws and regulations, as these may be amended over time, may impose liability
for the release of certain materials into the air or water from a current or former real estate investment, including
asbestos, and such release can form the basis for liability to third persons for personal injury or other damages.
Other laws and regulations can limit the development of, and impose liability for the disturbance of, wetlands or
the habitats of threatened or endangered species.
In addition, the Beni Stabili Group's exposure to potential health and environmental risks may tarnish the image
and the reputation of the Issuer.
Non-compliance with, or liabilities under, existing or future environmental laws and regulations, including failure
to hold the requisite permits or licences, could result in fines, penalties, third-party claims and other costs that
could have a material adverse effect on the Group's business, financial condition and/or results of operations. This
could, in turn, have a material adverse impact on the ability of the Issuer to make repayments under the Notes and
its other financial indebtedness, although prospective investors should note that, historically, the Group is not
aware of any such claims, penalties or similar actions arising in respect of the properties in its portfolio.
The Group is currently involved in a number of disputes
At the date of this Prospectus, Beni Stabili and other Group companies are parties to a number of legal and tax
disputes arising in the ordinary course of their activities (see the section headed "Description of the
Issuer - Litigation and contingencies", as well as pages 180 to 184 of the audited consolidated annual financial
statements of the Issuer for the financial year ended 31 December 2016 and pages 114 to 118 of the unaudited
consolidated half-year financial statements of the Issuer as at and for the six months ended on 30 June 2017,
incorporated by reference in this Prospectus).
The Group monitors the development of these proceedings with the help of external advisers and, where necessary,
has recorded provisions considered appropriate in light of the circumstances following a prudent analysis of each
dispute and the risks concerned. The evaluation of risks is, however, subjective and necessarily involves
estimations of potential liabilities. There can be no assurance that the ultimate outcome of these disputes will not
have a material adverse impact on the Group's financial conditions and results of operations and there can be no
assurance that further disputes, not currently known to the Issuer, will not be commenced in the future.
The Group may be insufficiently insured to cover all of the losses, damage and limitations of use which may
affect its properties
The Group is required by its best practice and policy guidelines to maintain or procure that there is maintained
certain insurance cover with respect to its portfolio of property assets consistent with market practice. In addition,
the Group is required to maintain such insurance cover in relation to assets that have been mortgaged to secure
financings (which is the case in respect of most of the Group's assets). The Group has entered into an annual global
insurance policy with a primary insurer covering damages to its property assets as a result of fire, natural and
socio-political events, earthquakes and structural collapses, with an additional insurance policy extending coverage
up to a maximum recoverable amount of 50 million per annum for insured loss caused by natural events and
earthquakes. The Group also has insurance covering liability for damages caused to third parties for a maximum

6

recoverable amount of 10.33 million, with an additional insurance policy extending coverage for such damages up
to 20.33 million.
The Group's ability to continue to fulfil these requirements will be subject to the availability of such insurance
generally in the global insurance market. The Group may remain exposed (or become further exposed) to certain
uninsured risks, for example, where insurance is not generally available or is not generally available on
commercially reasonable terms.
The Group's insurance policies are subject to exclusions of liability and limitations of liability both in amount and
with respect to the type of insured loss events.
In addition, there are certain types of losses, generally of a catastrophic nature, such as those caused by floods,
hurricanes, terrorism or acts of war that may be or become uninsurable or unavailable on commercially reasonable
terms. Inflation, changes in building codes and ordinances, environmental considerations and other factors, may
also result in insurance proceeds, if any, being insufficient to repair or replace a property if it is damaged or
destroyed. Under such circumstances, the insurance proceeds, if any, may be inadequate to fully compensate the
Group with respect to the affected real estate. Should an uninsured loss or a loss in excess of insured limits occur,
the Group could lose capital invested in the affected property as well as anticipated future revenue from that
property. In addition, the Group could be liable to repair damage caused by uninsured risks. The Group would also
remain liable for any debt or other financial obligation related to that property. There can be no guarantee that the
level of insurance cover for the Group now or in the future will be sufficient. No assurance can be given that
material losses in excess of insurance proceeds will not occur in the future or that any insurance proceeds will be
received at all. If such losses occur and are not covered by insurance and the Group has to make a payment, there
could be an adverse effect on the Group's business, financial condition and/or results of operations. This could, in
turn, have a material adverse impact on the ability of the Issuer to meet its obligations under the Notes and/or its
obligations under its other financial indebtedness.
Risks related to the tax treatment of the Issuer as a Siiq
Effective from January 2011, the Issuer opted for the "SIIQ" (Società Immobiliare di Investimento Quotata Real
Estate Investment Trust) regime, i.e., a special status which allows a company to benefit from certain tax
advantages.
In order to hold the SIIQ status, certain requirements must be met by the Issuer at all times, including but not
limited to compliance with objective requirements (such as being incorporated as a joint-stock company, having tax
residence in Italy or in a "white listed" member state of the EU/EEA and being listed on a regulated stock
exchange), corporate requirements (the by-laws shall set out the rules governing the investment policy, risk
limitations on counterparty concentration and the maximum permitted leverage), shareholding structure and
corporate governance limitations (the controlling stakeholder cannot own more than 60 per cent. of the voting
rights) and limitations on corporate rental activity (the regime requires a minimum 80 per cent. ratio between assets
rented or to be rented plus participation into SIIQ/SIINQ and total assets (the so called "Asset Test") as well as a
minimum 80 per cent. ratio between revenues from rents (and related recovered costs) plus dividends from
SIIQ/SIINQ and total revenues (the so called "Profit Test").
As at the date of this Prospectus, the Issuer is in compliance with all requirements under the relevant legal
provisions to hold the SIIQ status, and thus, to benefit from the related special tax regime. However, in the future,
if the Issuer is not able to comply with such requirements, among which, the requirement to distribute a portion of
income from leasing activities and also the income calculated in application of the so-called "carry forward"
mechanism, or if it is not able to restore these measures by any deadline imposed by applicable regulations, the
Issuer could lose this favourable tax treatment and be subject to ordinary taxation with a consequent negative
impact on the Issuer's operating and financial position and on its ability to distribute dividends.

7

As at the date of this Prospectus, based on the response received to a ruling submitted to the Italian Tax Authorities
(Agenzia delle Entrare "ITA") on the calculation criteria to be followed, the Issuer has no carry forward
obligation. If, in spite of the above, the approach is not confirmed, a maximum amount of carry forward obligations
would be equal to 111,9 million. In this respect, it is worth noting that further verifications are ongoing and the
Issuer expects that the approach currently taken would be confirmed and the Issuer would not be subject to such
carry forward obligations.
Given their financial and economic importance for the purpose of the Asset Test and the Profit Test, the forfeiture
of the special scheme by the participating SIINQ could also result in important effects with regard to the Issuer
maintaining the SIIQ regime.
Risks related to information systems and cyber crime
Information systems have an essential role within the context of the Group's activities. A default or a system failure
leading to loss or deterioration of data could have adverse consequences on the Issuer's activities.
The Beni Stabili Group may also be subject to cyber-attacks or fraud attacks which may lead to theft, loss of
information or business interruption.
These interruptions, violations or defaults of the information systems could have adverse financial consequence or
damage the Group's image.
Risks associated to the financial markets and the financial position of the Beni Stabili Group
Risks relating to global financial conditions
The continuing uncertainty regarding the development of the global economy, for example due to the ongoing
sovereign debt crises and inflation and deflation risks in many parts of the world, particularly in Europe, the
uncertainties associated with the outcome of the United Kingdom's vote to leave the European Union and the
ongoing quantitative easing announced by the European Central Bank, may result in economic instability, limited
access to debt and equity financing and possible defaults by the Issuer's counterparties.
As a result, the Issuer's ability to access the capital and financial markets and to refinance debt to meet the
financial requirements of the Issuer and the Group may be adversely impacted and costs of financing may
significantly increase. This could adversely affect the business, results of operations and financial condition of the
Issuer, with a consequent adverse effect on the market value of the Notes and the Issuer's ability to meet its
obligations under the Notes.
Liquidity risk
To finance its investments and acquisitions and to refinance any debts that have reached maturity, the Issuer must
be in a position to raise significant financial resources. The Issuer runs the risk of experiencing a lack of liquidity if
it is unable to raise the necessary resources in the form of equity or borrowing.
The Issuer also incurs the risk of insufficient liquidity to service its debt. A shortage of cash could result in
acceleration or prepayment, and if the debt is collateralised, enforcement of the guarantee and, where applicable,
the seizure of assets
Under the SIIQ regime, Beni Stabili is required to distribute a significant part of its profits. Therefore, it relies to a
great extent on debt to finance its growth. This type of financing may sometimes not be available at advantageous
terms, depending on, among others, favourable market conditions (see "Risks relating to the global financial
conditions" above).
These factors may materially and adversely affect the Group's results of operations and financial condition should
the Issuer be obliged to incur extra costs to meet its financial commitments or continue investments or, in extreme

8

cases, threaten the Issuer's future as a going concern and lead to insolvency with possible consequences on the
Issuer's ability to fulfil its obligations under the Notes.
The Group is exposed to interest rate fluctuations
As the Group's financial indebtedness comprises various financings, including a number which require payment of
interest at a floating rate, it is particularly exposed to the risk of interest rate fluctuations. The Group seeks to
minimise its exposure through hedging activities, primarily interest rate swaps, interest rate swaption, interest rate
caps and zero cost collars. There is a constant monitoring of interest rate risk through valuation tests conducted on
a quarterly basis. Whilst the Group does not carry out any purely speculative transactions, nor any transaction not
directly connected to its debt exposure, and derivative instruments as at 30 June 2017 cover approximately 75.51%
per cent. of the outstanding principal amount of its indebtedness, the protection offered by derivative instruments is
limited in amount and in time and, as a result, future interest rate fluctuations may nonetheless adversely affect the
Group's financial condition and results of operations.
Financial counterparty risk
The use of lines of credit and of interest rate hedging contracts from financial institutions could expose Beni Stabili
to the risk of insolvency by the counterparties to such contracts, triggering payment delays or defaults, which could
result in a negative impact on Beni Stabili's financial condition and results of operations.
It should be noted that the Group operates on a continuing and permanent basis with primary counterparties with an
acceptable credit rating, thus limiting the related credit risk.
Risks linked to covenants and other undertakings stipulated in certain credit agreements
Some credit contracts signed by Beni Stabili contain commitments or covenants that the Issuer undertakes to
respect. If Beni Stabili were to breach one of its financial undertakings and fail to remedy such breach within the
contractually stipulated time period, the lenders could demand early repayment of the debt and possibly seize any
collateral backing the debt. Consequently, any failure to meet its financial undertakings could have an adverse
impact on Beni Stabili' financial condition, its results of operations, and its flexibility in conducting business and
pursuing its development.
The Group is exposed to fluctuations in the rate of inflation
Most lease contracts with tenants are inflation-linked, providing for an increase in rent by a certain percentage
based on price inflation; however, none of the lease contracts provide for a corresponding decrease in rental prices
in the event of price deflation. Fluctuations in the level of inflation are largely out of the control of the Group and
could have a material adverse impact on the ability of the Issuer to meet its obligations under the Notes and/or its
obligations under its other financial indebtedness.
Factors which are material for the purpose of assessing the market risks associated with Notes
Credit ratings may not reflect all risks
Standard & Poor's Credit Market Services Europe Limited have assigned credit ratings to the Issuer and the Notes.
The ratings may not reflect the potential impact of all risks related to structure, market, additional factors discussed
above, and other factors that may affect the value of the Notes. A rating or the absence of a rating is not a
recommendation to buy, sell or hold securities and may be revised or withdrawn by the rating agency at any time.
In general, European regulated investors are restricted under the CRA Regulation from using credit ratings for
regulatory purposes, unless such ratings are issued by a credit rating agency established in the EU and registered
under the CRA Regulation (and such registration has not been withdrawn or suspended, subject to transitional
provisions that apply in certain circumstances). Such general restrictions will also apply in the case of credit

9