Macquarie DDR reaffirms debt position and continued strong portfolio performance

18 December 2007

Macquarie DDR Trust (ASX:MDT) today provided an update on the Trust’s capital position confirming there are no debt facilities due to expire within the current financial year.  Furthermore the strength of management, quality of real estate and high quality tenants support stability of income and outlook for the Trust’s future.

As at 30 September 2007, Macquarie DDR’s gearing level was 52 per cent being debt to total assets.  The weighted average term to maturity of all debt facilities was 2.5 years as of 30 November 2007.  The following table sets out the debt maturity profile.

The Trust has two debt facilities maturing in December 2008 and June 2009.   These facilities enjoy a modest loan to value ratio of 46 per cent as at 30 June and the current cash flow comfortably servicing the debt by an average of 3.0 times, reflecting the underlying strength and quality of these assets and further supporting future refinancing.

The Trust has actively sought to spread debt maturities, diversify funding sources and proactively extend and refinance upcoming maturities to ensure that they are not exposed to any unexpected changes in market conditions.   For example, during April 2007, Macquarie DDR proactively established a three year US$305 million revolving debt facility which refinanced other debt facilities due to mature in June 2007 and beyond.

As part of the ongoing management of refinancing risk, the Trust seeks to ensure debt is sourced from a number of sectors and regions as evidenced in the following chart:

The Trust’s Chairman, Mr Richard Sheppard, said: “Despite the current challenging credit environment, the Trust remains in a solid position.   The portfolio benefits from 97.4 per cent occupancy as at 30 September 2007, a long weighted average lease expiry of over seven years, quality assets spread across 24 US states, and high tenant diversification which include some of the largest and most successful retailers in the US.”

Importantly, the Trust’s lease structures support stability of income. Approximately 29 per cent of contracted income is subject to fixed rental increases for the remainder of the financial year 2008 and only 0.2 per cent of net operating income is linked to sales turnover.

Mr Sheppard added: “The Trust’s debt position remains strong and in addition, investors continue to benefit from the property management expertise of our joint venture partner Developers Diversified Realty.   As discussed at our unit holder meeting last week, management will continue to implement the Trust’s investment strategy to enhance unit holder returns.”

Macquarie DDR Trust is a listed property trust with assets totalling A$2.6 billion.   Circa A$24 billion of real estate assets are managed globally by Macquarie Real Estate and its associates, across a portfolio of listed and unlisted property trusts, unlisted development funds and property investment syndicates. Macquarie's real estate investment management expertise has been recognised internationally, voted No. 1 in Investment Management in Asia, Australia, China, Hong Kong, Singapore and the US in the 2007 Euromoney Liquid Real Estate Awards.

Developers Diversified currently owns and manages approximately 740 retail operating and development properties in 45 states, plus Puerto Rico and Brazil, totalling over 155 million square feet. Developers Diversified Realty is a self-administered and self-managed real estate investment trust (REIT) operating as a fully integrated real estate company which acquires, develops, leases and manages shopping centers.  Additional information about Developers Diversified is available at http://www.ddr.com.

For further information please call 1300 365 585 or email  reits@macquarie.com