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THE ENDURANCE REAL ESTATE FUND FOR CENTRAL EUROPE

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					                                                  APRIL 2005




               THE ENDURANCE REAL ESTATE FUND FOR CENTRAL
               EUROPE
CONFIDENTIAL




               Prospectus
AND
PRIVATE
STRICTLY
                                                                                         CONFIDENTIAL




            Disclaimer

            THE FUND IS RESERVED FOR INFORMED INSTITUTIONAL INVESTORS WHO, ON THE BASIS OF THIS
            PROSPECTUS AND THE MANAGEMENT REGULATIONS, HAVE MADE THEIR OWN ASSESSMENT OF THE
            CONDITIONS OF THEIR PARTICIPATION IN THE FUND, WHICH HAS BENEFITED FROM A SOFTENED
            REGISTRATION PROCEDURE. ACCORDINGLY, IT IS THE RESPONSIBILITY OF PARTICIPATING INVESTORS,
            ESPECIALLY THOSE WHO MAY HOLD A MINORITY INTEREST IN THE FUND, TO DETERMINE WHETHER
            THEIR RIGHTS AND OBLIGATIONS AS UNITHOLDERS ARE SUITABLE FOR THEM, PARTICULARLY IN
            CONNECTION WITH THE PRINCIPAL OF EQUAL TREATMENT OF UNITHOLDERS.

            ONLY THOSE PARTICULAR REPRESENTATIONS AND WARRANTIES, IF ANY, WHICH ARE MADE IN THIS
            PROSPECTUS AND ANY SUBSCRIPTION AGREEMENT BETWEEN THE FUND AND A PROSPECTIVE INVESTOR,
            SUBJECT TO SUCH LIMITATIONS AND RESTRICTIONS AS MAY BE AGREED, SHALL HAVE ANY LEGAL EFFECT
            AND SUBSCRIPTIONS FOR UNITS IN THE FUND ARE ONLY EFFECTED ON THE BASIS OF THIS PROSPECTUS
            AND THE MANAGEMENT REGULATIONS OF THE FUND AS APPROVED BY THE LUXEMBOURG SUPERVISORY
            AUTHORITY. THIS PROSPECTUS AND SUCH SUBSCRIPTION AGREEMENT WILL SUPERSEDE AND EXTINGUISH
            ALL REPRESENTATIONS AND WARRANTIES MADE AT ANY TIME PRIOR TO THE DATE OF SUCH AGREEMENT.
            IN THE EVENT THAT THE DESCRIPTIONS OR TERMS IN THIS PROSPECTUS ARE INCONSISTENT WITH OR
            CONTRARY TO THE DESCRIPTIONS IN OR TERMS OF THE DEFINITIVE SUBSCRIPTION AGREEMENT AND THE
            MANAGEMENT REGULATIONS, SUCH SUBSCRIPTION AGREEMENT AND MANAGEMENT REGULATIONS SHALL
            PREVAIL.

            THIS PROSPECTUS DOES NOT PURPORT TO BE ALLINCLUSIVE OR TO CONTAIN ALL THE INFORMATION THAT
            A PROSPECTIVE PURCHASER MAY DESIRE IN EVALUATING THE FUND. PROSPECTIVE PURCHASERS SHOULD
            CONDUCT THEIR OWN INVESTIGATION AND ANALYSIS OF THE BUSINESS, DATA AND PROPERTY DESCRIBED
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            HEREIN, AND SHOULD ALSO INFORM THEMSELVES ABOUT AND OBSERVE ANY LEGAL AND/OR REGULATORY
            REQUIREMENTS WHICH MAY BE APPLICABLE TO THEIR PROPOSED INVESTMENT IN, INVESTIGATION OR
            EVALUATION OF THE FUND. ANY PERSON INTERESTED IN SUBSCRIBING UNITS IN THE FUND IS
            RECOMMENDED TO SEEK ITS OWN LEGAL, REGULATORY, TAX, ACCOUNTING AND FINANCIAL ADVICE.
CENTR AL




            NO PERSON, OTHER THAN THE OFFICERS AND DIRECTORS OF THE MANAGEMENT COMPANY, HAS BEEN
            AUTHORISED TO GIVE ANY INFORMATION OTHER THAN THAT CONTAINED IN THIS PROSPECTUS, OR TO
            MAKE ANY REPRESENTATION IN CONNECTION WITH THE UNITS DESCRIBED HEREIN, AND, IF GIVEN OR
            MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
            AUTHORISED BY THE FUND, EITHER THE SPONSOR OR JPMORGAN.
FOR




            IN FURNISHING THIS PROSPECTUS, THE FUND, THE SPONSOR AND JPMORGAN RESERVE THE RIGHT TO
            AMEND OR REPLACE THIS PROSPECTUS AT ANY TIME AND UNDERTAKE NO OBLIGATION TO PROVIDE THE
            RECIPIENT WITH ACCESS TO ANY ADDITIONAL INFORMATION. NOTHING CONTAINED WITHIN THIS
FUND




            PROSPECTUS IS OR SHOULD BE RELIED UPON AS A PROMISE OR REPRESENTATION AS TO THE FUTURE.

            THIS PROSPECTUS CONTAINS FORWARD LOOKING STATEMENTS THAT RELATE TO THE FUND'S FINANCIAL
            CONDITION, RESULTS OF OPERATIONS, BUSINESS PLAN, STRATEGIES, COMPETITIVE POSITION AND
E STATE




            GROWTH OPPORTUNITIES AND THE FINANCIAL AND REGULATORY ENVIRONMENTS IN WHICH THE FUND
            WILL OPERATE. THESE FORWARD LOOKING STATEMENTS ARE IDENTIFIABLE BY WORDS SUCH AS
            "ANTICIPATE", "ESTlMATE", "PROJECT", "PLAN", "INTEND", "EXPECT", "BELIEVE", "FORECAST" AND SIMILAR
            EXPRESSIONS, AND ARE LOCATED THROUGHOUT THIS PROSPECTUS. PROSPECTIVE INVESTORS SHOULD BE
            AWARE THAT THESE STATEMENTS ARE ESTIMATES, REFLECTING ONLY THE JUDGMENT OF THE SPONSOR'S
REAL




            MANAGEMENT AND PROSPECTIVE INVESTORS SHOULD NOT PLACE RELIANCE ON ANY FORWARD LOOKING
            STATEMENTS. ACTUAL RESULTS AND EVENTS COULD DIFFER MATERIALLY FROM THOSE CONTEMPLATED BY
            THESE FORWARD LOOKING STATEMENTS AS A RESULT OF FACTORS SUCH AS THOSE DESCRIBED IN "RISK
ENDURANCE




            FACTORS" AND ELSEWHERE IN THIS PROSPECTUS. NEITHER THE FUND, NOR THE SPONSOR, NOR THE
            PLACEMENT AGENT UNDERTAKES ANY OBLIGATION PUBLICLY TO UPDATE OR REVISE THE FORWARD
            LOOKING STATEMENTS CONTAINED IN THIS PROSPECTUS TO REFLECT EVENTS OR CIRCUMSTANCES
            OCCURRING AFTER THE DATE OF THIS PROSPECTUS OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED
            EVENTS.
THE




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            THE PRO FORMA AND ESTIMATED FINANCIAL INFORMATION CONTAINED HEREIN WAS PREPARED EXPRESSLY
            FOR USE HEREIN AND IS BASED ON CERTAIN ASSUMPTIONS AND ANALYSES BY THE MANAGEMENT OF THE
            FUND OF INFORMATION AVAILABLE AT THE TIME THIS PROPSECTUS WAS PREPARED. THERE IS NO
            REPRESENTATION, WARRANTY OR OTHER ASSURANCE THAT ANY OF THE PROJECTIONS WILL BE REALISED.

            THE UNITS DESCRIBED IN THIS PROSPECTUS ARE SPECULATIVE AND ANY INVESTMENT IN SUCH UNITS
            INVOLVES A HIGH DEGREE OF RISK. EACH PROSPECTIVE PURCHASER SHOULD PROCEED ON THE
            ASSUMPTION THAT IT MUST BEAR THE ECONOMIC RISK OF INVESTMENT IN THE FUND FOR AN INDEFINITE
            PERIOD AND BE ABLE TO WITHSTAND A TOTAL LOSS OF ITS INVESTMENT.

            THERE IS NO PUBLIC MARKET FOR THE UNITS, AND NO SUCH MARKET IS EXPECTED TO DEVELOP IN THE
            FUTURE. THE UNITS ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE
            TRANSFERRED OR RESOLD EXCEPT IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFERABILITY
            CONTAINED IN THE MANAGEMENT REGULATIONS AND THE SUBSCRIPTION AGREEMENT. THE FUND MAY
            CONDITION ANY TRANSFER ON THE RECEIPT OF LEGAL OPINIONS AND OTHER EVIDENCE OF COMPLIANCE.
            THE FUND HAS NO OBLIGATION OR INTENTION TO REGISTER THE UNITS.

            CAPITALISED TERMS, IF NOT OTHERWISE DEFINED IN THIS PROSPECTUS, WILL HAVE THE MEANINGS GIVEN
            TO THEM IN THE MANAGEMENT REGULATIONS.

            RESTRICTIONS ON SOLICITATIONS AND RESALE

            SUBSCRIPTION FOR UNITS IN THE FUND MAY ONLY BE EFFECTED ON THE BASIS OF THIS PROSPECTUS, THE
            MANAGEMENT REGULATIONS AND THE SUBSCRIPTION AGREEMENT IN THEIR FINAL VERSION AS APPROVED
            BY THE LUXEMBOURG SUPERVISORY AUTHORITY.

            THIS PROSPECTUS DOES NOT CONSTITUE AN OFFER TO SELL TO, OR A SOLICITATION OF AN OFFER TO
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            SUBSCRIBE FROM, ANYONE IN ANY COUNTRY OR JURISDICTION (I) IN WHICH SUCH AN OFFER OR
            SOLICITATION IS NOT AUTHORISED, (II) IN WHICH ANY PERSON MAKING SUCH OFFER OR SOLICITATION IS
            NOT QUALIFIED TO DO SO OR (III) IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD OTHERWISE BE
            UNLAWFUL. NO ACTION HAS BEEN TAKEN THAT WOULD, OR IS INTENDED TO, PERMIT A PUBLIC OFFER OF
            UNITS IN THE FUND IN ANY COUNTRY OR JURISDICTION WHERE ANY SUCH ACTION FOR THAT PURPOSE IS
CENTR AL




            REQUIRED. ACCORDINGLY, UNITS MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, AND NEITHER
            THIS PROSPECTUS NOR ANY OTHER INFORMATION, FORM OF APPLICATION, ADVERTISEMENT OR OTHER
            DOCUMENT MAY BE DISTRIBUTED OR PUBLISHED IN ANY COUNTRY OR JURISDICTION EXCEPT UNDER
            CIRCUMSTANCES THAT WILL RESULT IN COMPLIANCE WITH ANY APPLICABLE LAWS AND REGULATIONS.
            PERSONS INTO WHOSE POSSESSION THIS PROSPECTUS COMES MUST INFORM THEMSELVES ABOUT AND
            OBSERVE ANY LEGAL RESTRICTIONS AFFECTING ANY SUBSCRIPTION OF UNITS IN THE FUND. NEITHER THE
FOR




            PLACEMENT AGENT, NOR THE SPONSOR NOR THE FUND ARE MAKING ANY REPRESENTATION OR WARRANTY
            TO ANY PROSPECTIVE INVESTOR REGARDING THE LEGALITY OF AN INVESTMENT IN THE FUND BY SUCH
FUND




            PERSON UNDER APPROPRIATE SECURITIES OR SIMILAR LAWS.

            NOTICE TO RECIPIENTS IN AUSTRIA
E STATE




            THE UNITS IN THE FUND MUST NOT BE DISTRIBUTED WITHIN AUSTRIA BY WAY OF A PUBLIC OFFER,
            PUBLIC ADVERTISEMENT OR IN ANY SIMILAR MANNER (INCLUDING SOLICITING OFFERS) AND THIS
            PROSPECTUS AND ANY OTHER DOCUMENT RELATING TO THE UNITS IN THE FUND, AS WELL AS
            INFORMATION OR STATEMENTS CONTAINED THEREIN, MAY NOT BE SUPPLIED TO THE PUBLIC IN AUSTRIA
            OR USED IN CONNECTION WITH MAKING OR SOLICITING ANY OFFER FOR SUBSCRIPTION OF UNITS IN THE
REAL




            FUND IN AUSTRIA.

            NOTICE TO RECIPIENTS IN CANADA
ENDURANCE




            NO SECURITIES COMMISSION OR SIMILAR AUTHORITY IN CANADA HAS REVIEWED THIS PROSPECTUS OR HAS
            IN ANY WAY PASSED UPON THE MERITS OF THE UNITS IN THE FUND WHICH MAY BE OFFERED IN THE
            MANNER CONTEMPLATED HEREBY, AND ANY REPRESENTATION TO THE CONTRARY IS AN OFFENCE. THE
            UNITS IN THE FUND HAVE NOT BEEN AND WILL NOT BE QUALIFIED BY A PROSPECTUS FOR SALE TO THE
            PUBLIC IN CANADA UNDER APPLICABLE CANADIAN SECURITIES LAWS AND ACCORDINGLY, ANY OFFER OR
THE




                                                        - iii -
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            SALE OF THE UNITS IN THE FUND MUST BE MADE PURSUANT TO AN EXEMPTION FROM THE APPLICABLE
            FILING REQUIREMENTS, AND OTHERWISE IN COMPLIANCE WITH APPLICABLE CANADIAN LAWS.

            NOTICE TO RECIPIENTS IN DENMARK

            THE UNITS IN THE FUND WILL BE OFFERED TO A LIMITED NUMBER OF INSTITUTIONAL INVESTORS AND
            THEREFORE NO ACTION HAS OR WILL BE TAKEN THAT WOULD ALLOW AN OFFERING OF UNITS IN THE
            FUND TO THE PUBLIC IN DENMARK. THIS PROSPECTUS HAS NOT BEEN FILED WITH OR APPROVED BY THE
            DANISH SECURITIES COUNCIL OR ANY OTHER REGULATORY AUTHORITY IN DENMARK. THE UNITS IN THE
            FUND HAVE NOT BEEN OFFERED, SOLD AND MAY NOT BE OFFERED, SOLD OR DELIVERED DIRECTLY OR
            INDIRECTLY IN DENMARK UNLESS IN COMPLIANCE WITH CHAPTER 12 OF THE DANISH ACT ON TRADING IN
            SECURITIES AND THE DANISH EXECUTIVE ORDER NO. 166 OF 13 MARCH 2003 ON THE FIRST PUBLIC OFFER
            OF CERTAIN SECURITIES ISSUED PURSUANT THERETO.

            NOTICE TO RECIPIENTS IN FRANCE

            THE UNITS IN THE FUND CANNOT BE OFFERED OR SOLD TO THE PUBLIC IN FRANCE. THIS PROSPECTUS
            AND ANY OFFERING MATERIAL RELATING TO THE OFFER OF UNITS IN THE FUND MAY NOT BE DISTRIBUTED
            TO THE PUBLIC IN FRANCE EXCEPT TO QUALIFIED INVESTORS (INVESTISSEURS QUALIFIÉS) OR TO A
            RESTRICTED GROUP OF INVESTORS (CERCLE RESTREINT D’INVESTISSEURS), ALL AS DEFINED IN ARTICLE
            L.411-2 OF THE CODE MONÉTAIRE ET FINANCIER AND DÉCRET N° 98-880 DATED 1ST OCTOBER, 1998. NO
            SOLICITATION, AS DEFINED IN ARTICLE L341-1 AND FOLLOWING OF THE MONETARY AND FINANCIAL CODE,
            FOR SUBSCRIPTION IN UNITS IN THE FUND WILL BE MADE TO THE PUBLIC IN FRANCE. THIS PROSPECTUS
            HAS NOT BEEN SUBMITTED TO THE CLEARANCE PROCEDURE OF THE FRENCH AUTHORITIES, INCLUDING
            THE AUTORITE DES MARCHES FINANCIERS IN FRANCE. THIS PROSPECTUS OR ANY OTHER OFFERING
            MATERIAL RELATING TO THE INSTRUMENTS REFERRED THEREIN HAS NOT BEEN DISTRIBUTED OR CAUSED
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            TO BE DISTRIBUTED AND WILL NOT BE DISTRIBUTED OR CAUSED TO BE DISTRIBUTED IN FRANCE OTHER
            THAN TO THOSE INVESTORS TO WHOM OFFERS AND SALES OF THE UNITS IN THE FUND IN FRANCE MAY BE
            MADE.

            NOTICE TO RECIPIENTS IN GERMANY
CENTR AL




            THE DISTRIBUTION OF THE UNITS IN THE FUND HAS NOT BEEN AND WILL NOT BE NOTIFIED TO THE
            BUNDESANSTALT FUER FINANZDIENSTLEISTUNGSAUFSICHT IN ACCORDANCE WITH THE GERMAN FOREIGN
            INVESTMENT ACT (AUSLANDINVESTMENT-GESETZ) NOR HAS OR WILL A SALES PROSPECTUS BE PUBLISHED
            IN RESPECT OF THE UNITS IN THE FUND. THE UNITS IN THE FUND ARE NOT AUTHORISED FOR PUBLIC
            DISTRIBUTION UNDER GERMAN LAW. CONSEQUENTLY, IN GERMANY, THE UNITS IN THE FUND WILL BE
            MADE AVAILABLE ONLY TO PROFESSIONAL INVESTORS. THE UNITS IN THE FUND MUST NOT BE
FOR




            DISTRIBUTED WITHIN GERMANY BY WAY OF A PUBLIC OFFER, PUBLIC ADVERTISEMENT OR IN ANY SIMILAR
            MANNER AND THIS PROSPECTUS AND ANY OTHER DOCUMENT RELATING TO THE UNITS IN THE FUND, AS
FUND




            WELL AS INFORMATION OR STATEMENTS CONTAINED THEREIN, MAY NOT BE SUPPLIED TO THE PUBLIC IN
            GERMANY OR USED IN CONNECTION WITH ANY OFFER FOR SUBSCRIPTION OF UNITS IN THE FUND TO THE
            PUBLIC IN GERMANY OR ANY OTHER MEANS OF PUBLIC MARKETING. PROSPECTIVE INVESTORS IN GERMANY
            ARE URGED TO CONSULT THEIR OWN TAX ADVISERS AS TO THE TAX CONSEQUENCES THAT MAY ARISE
E STATE




            FROM AN INVESTMENT IN THE FUND.

            NOTICE TO RECIPIENTS IN IRELAND

            THIS PROSPECTUS HAS NOT BEEN APPROVED BY THE IRISH FINANCIAL SERVICES REGULATORY AUTHORITY.
REAL




            THE FUND HAS NOT BEEN AUTHORISED AND IS NOT SUPERVISED BY THE IRISH FINANCIAL SERVICES
            REGULATORY AUTHORITY. THIS PROSPECTUS DOES NOT AND SHALL NOT CONSTITUTE AN INVITATION TO
            THE PUBLIC IN IRELAND TO PURCHASE UNITS IN THE FUND AND THE FUND DOES NOT PROVIDE FACILITIES
            FOR PARTICIPATION BY THE PUBLIC IN IRELAND TO PURCHASE UNITS IN IT. THE DISTRIBUTION OF THIS
ENDURANCE




            PROSPECTUS AND THE OFFER OF UNITS IN THE FUND IS RESTRICTED TO THE INDIVIDUALS TO WHOM IT IS
            ADRESSED. NO PERSON OTHER THAN THE PERSON TO WHOM THIS PROSPECTUS IS ADRESSED MAY TREAT IT
            AS CONSTITUTING AN INVITATION TO THEM TO SUBSCRIBE FOR UNITS IN THE FUND. THE INFORMATION
            CONTAINED HEREIN IS DIRECTED TO A SMALL NUMBER OF SELECT PERSONS WHOSE ORDINARY BUSINESS IS
            TO BUY OR SELL SECURITIES AND TO WHOM THE UNITS IN THE FUND ARE BEING OFFERED IN THE CONTEXT
            OF THEIR TRADE, PROFESSION OR OCCUPATION.
THE




                                                       - iv -
                                                                                     CONFIDENTIAL




            NOTICE TO RECIPIENTS IN ISRAEL

            THIS PROSPECTUS HAS NOT BEEN REVIEWED OR APPROVED BY, OR REGISTERED WITH, THE ISRAELI
            SECURITIES AUTHORITY. UNITS IN THE FUND WILL BE SOLD TO, AND AT ALL TIMES WILL BE HELD BY, NO
            MORE THAN 50 ENTITIES WORLDWIDE AND WILL NOT BE OFFERED TO MORE THAN 35 OFFEREES, OR BY
            WAY OF OFFERING TO THE PUBLIC, IN ISRAEL. THIS PROSPECTUS SHALL NOT BE CONSTRUED AS A PUBLIC
            OFFERING OR PUBLIC SOLICITATION FOR THE PURCHASE OF THE UNITS IN THE FUND IN ISRAEL. THE
            MANAGEMENT COMPANY IS NOT AND WILL NOT BE LICENSED UNDER THE REGULARIZATION OF INVESTMENT
            COUNSELING AND PORTFOLIO MANAGEMENT LAW, 1995. THIS PROSPECTUS MAY NOT BE REPRODUCED OR
            USED FOR ANY OTHER PURPOSE, NOR BE FURNISHED TO ANY OTHER PERSON OTHER THAN THOSE TO
            WHOM COPIES HAVE BEEN SENT.

            NOTICE TO RECIPIENTS IN ITALY

            THE UNITS IN THE FUND MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN ITALY OTHER THAN
            TO PROFESSIONAL INVESTORS AS DEFINED IN ARTICLE 31, PARAGRAPH 2, OF REGULATION NO. 11522
            APPROVED BY THE ITALIAN COMMISSIONE NAZIONALE PER LA SOCIETÁ E LA BORSA (“CONSOB”) ON JULY
            1ST, 1998, AS AMENDED FROM TIME TO TIME, (THE "PROFESSIONAL INVESTORS") OR UNDER ANY OTHER
            EXEMPTION PROVIDED FOR BY ARTICLE 100 OF LEGISLATIVE DECREE NO. 58 OF FEBRUARY 24, 1998 OR
            ARTICLE 33, PARAGRAPH 1 OF REGULATION NO. 11971 APPROVED BY CONSOB ON MAY 14, 1999, AS
            AMENDED FROM TIME TO TIME, AND IN COMPLIANCE WITH THE FORMS AND PROCEDURES PROVIDED
            THEREIN. UNDER NO CIRCUMSTANCES SHOULD THIS PROSPECTUS BE CIRCULATED AMONGST, OR BE
            DISTRIBUTED IN ITALY TO, ANY MEMBER OF THE GENERAL PUBLIC IN ITALY OR TO INDIVIDUALS OR
            ENTITIES FALLING OUTSIDE THE CATEGORIES OF PROFESSIONAL INVESTORS OR OUTSIDE THE SCOPE OF
            THE EXEMPTIONS PROVIDED FOR BY ARTICLE 100 OF LEGISLATIVE DECREE NO. 58 OF FEBRUARY 24, 1998
            OR ARTICLE 33, PARAGRAPH 1 OF REGULATION NO. 11971 APPROVED BY CONSOB ON MAY 14, 1999, AS
EUROPE




            AMENDED FROM TIME TO TIME. ANY OFFER OR SALE OR ANY DISTRIBUTION OF THIS PROSPECTUS OR THE
            RENDERING OF ADVICE OF ANY NATURE WHATSOEVER RELATED TO AN INVESTMENT IN THE FUND MUST BE
            CONDUCTED EITHER BY REGISTERED SECURITIES DEALING FIRMS ("SOCIETÀ DI INTERMEDIAZIONE
            MOBILIARE") OR BY AUTHORISED INTERMEDIARIES, AS DESCRIBED IN LEGISLATIVE DECREE NO. 58 OF
            FEBRUARY 24, 1998.
CENTR AL




            NOTICE TO RECIPIENTS IN THE NETHERLANDS

            THE UNITS IN THE FUND MAY NOT BE OFFERED, TRANSFERRED, DELIVERED OR SOLD, AND THIS
            PROSPECTUS MAY NOT BE CIRCULATED, IN THE NETHERLANDS, TO PERSONS OTHER THAN INDIVIDUALS OR
            LEGAL ENTITIES WHICH TRADE OR INVEST IN INVESTMENT OBJECTS AS OFFERED BY THE FUND IN THE
FOR




            COURSE OF A PROFESSION OR BUSINESS WITHIN THE MEANING OF SECTION 1 OF THE REGULATION DATED
            OCTOBER 9, 1990 REGARDING THE IMPLEMENTATION OF SECTION 14 OF THE WET TOEZICHT
            BELEGGINGSINSTELLINGEN (ACT ON THE SUPERVISION OF INVESTMENT INSTITUTIONS), AS AMENDED FROM
FUND




            TIME TO TIME.

            NOTICE TO RECIPIENTS IN NORWAY
E STATE




            THE UNITS IN THE FUND WILL BE OFFERED TO A LIMITED NUMBER OF INSTITUTIONAL INVESTORS AND NO
            SINGLE INVESTOR WILL INVEST AN AMOUNT LESS THAN € 40.000. THEREFORE, NO ACTION HAS OR WILL BE
            TAKEN FOR THE OFFERING OF UNITS IN THE FUND TO BE REGISTERED UNDER THE PUBLIC OFFERING RULES
            IN THE NORWEGIAN SECURITIES TRADING ACT. FURTHER, THE FUND HAS NOT BEEN, NOR WILL BE,
            REGISTERED OR APPROVED BY THE NORWEGIAN BANKING, INSURANCE AND SECURITIES COMMISSION AND
REAL




            IS THUS NOT SUBJECT TO PUBLIC SUPERVISION IN NORWAY. THIS PROSPECTUS MUST NOT BE COPIED OR
            OTHERWISE DISTRIBUTED BY THE RECIPIENT. THE CONTENTS OF THIS PROSPECTUS HAVE NOT BEEN
            APPROVED BY OR REGISTERED WITH THE OSLO STOCK EXCHANGE OR THE NORWEGIAN COMPANIES
            REGISTRY.    EACH INVESTOR SHOULD CAREFULLY CONSIDER INDIVIDUAL TAX QUESTIONS BEFORE
ENDURANCE




            INVESTING IN THE FUND.

            NOTICE TO RECIPIENTS IN POLAND

            THE UNITS IN THE FUND WILL NOT BE OFFERED TO UNSPECIFIED PERSONS IN POLAND OR ADVERTISED IN
            POLAND BY MEANS OF THE MASS MEDIA NOR WILL THE UNITS BE OFFERED TO MORE THAN 300 PERSONS IN
THE




                                                        -v-
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            POLAND. THEREFORE, THIS PROSPECTUS DOES NOT CONSTITUTE THE PUBLIC OFFER OF SECURITIES IN THE
            MEANING OF THE ACT ON PUBLIC TRADING IN SECURITIES OF AUGUST 21, 1997 (AS AMENDED) OF POLAND.
            THE UNITS IN THE FUND HAVE NOT BEEN, AND WILL NOT BE REGISTERED WITH THE KOMISJA PAPIERÓW
            WARTOŚCIOWYCH I GIEŁD, THE SECURITIES AND STOCK EXCHANGE COMMISSION OF POLAND.

            NOTICE TO RECIPIENTS IN SPAIN

            THE FUND IS REGARDED AS A NON-HARMONISED INVESTMENT COLLECTIVE UNDERTAKING PURSUANT TO
            COUNCIL DIRECTIVE 85/611/EEC OF 20 DECEMBER 1985, AS AMENDED, REQUIRING PRIOR AUTHORISATION
            FROM AND REGISTRATION WITH THE COMISIÓN NACIONAL DEL MERCADO DE VALORES (“CNMV”).
            ACCORDING TO LAW 46/1984, OF 26 DECEMBER, ON INVESTMENT COLLECTIVE UNDERTAKINGS, AS
            DEVELOPED BY ROYAL DECREE 1393/1990, OF 2 NOVEMBER, IN ORDER TO BE OFFERED IN SPAIN. THE
            FUND HAS NEITHER BEEN AUTHORISED NOR REGISTERED WITH THE CNMV. THEREFORE, THE UNITS IN THE
            FUND MAY NOT BE SOLD, OFFERED OR DISTRIBUTED IN SPAIN EXCEPT IN CIRCUMSTANCES WHICH DO NOT
            CONSTITUTE AN OFFER OF SECURITIES IN SPAIN WITHIN THE MEANING OF SPANISH SECURITIES LAWS OR
            WITHOUT COMPLYING WITH ALL LEGAL AND REGULATORY REQUIREMENTS IN RELATION THERETO.

            THIS PROSPECTUS HAS NOT BEEN REGISTERED WITH THE CNMV AND THEREFORE IT IS NOT INTENDED FOR
            THE MARKETING, SALE, OFFER OR DISTRIBUTION OF THE UNITS IN THE FUND IN SPAIN.

            NOTICE TO RECIPIENTS IN SWEDEN

            THE FUND, THE UNITS AND THIS PROSPECTUS HAVE NOT BEEN REGISTERED UNDER ANY SWEDISH
            SECURITIES LAW OR OTHERWISE, AND ANY SALE OR TRANSFER OF UNITS MUST TAKE PLACE OUTSIDE
            SWEDEN. THIS PROSPECTUS MAY NOT BE MADE AVAILABLE, NOR MAY UNITS OTHERWISE BE MARKETED AND
            OFFERED FOR SALE IN SWEDEN, OTHER THAN IN CIRCUMSTANCES WHICH ARE DEEMED NOT TO BE AN
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            OFFER TO THE PUBLIC IN SWEDEN UNDER ANY SWEDISH SECURITIES LAW OR OTHERWISE IS PERMITTED
            UNDER SWEDISH LEGISLATION. THIS PROSPECTUS MUST NOT BE DISTRIBUTED TO THE PUBLIC IN SWEDEN
            AND THE RECIPIENTS OF THIS PROSPECTUS MAY NOT FORWARD THIS PROSPECTUS OR ANY OFFER TO, OR
            REPLACE THEMSELVES WITH, ANY OTHER INVESTOR/INVESTORS IN SWEDEN WITHOUT COMPLYING WITH
            THE RELEVANT LAWS.
CENTR AL




            NOTICE TO RECIPIENTS IN THE UNITED ARAB EMIRATES

            THE FUND AND THE UNITS IN THE FUND HAVE NOT BEEN APPROVED OR LICENSED BY THE UAE CENTRAL
            BANK OR ANY OTHER RELEVANT LICENSING AUTHORITIES OR GOVERNMENTAL AGENCIES IN THE UNITED
            ARAB EMIRATES. THIS PROSPECTUS IS STRICTLY PRIVATE AND CONFIDENTIAL AND HAS NOT BEEN
            REVIEWED BY, DEPOSITED OR REGISTERED WITH ANY LICENSING AUTHORITY OR GOVERNMENTAL
FOR




            AGENCIES IN THE UNITED ARAB EMIRATES. THIS DOCUMENT IS BEING ISSUED TO A LIMITED NUMBER OF
            INSTITUTIONAL INVESTORS AND MUST NOT BE PROVIDED TO ANY PERSON OTHER THAN THE ORIGINAL
            RECIPIENT AND MAY NOT BE REPRODUCED OR USED FOR ANY OTHER PURPOSE. THIS PROSPECTUS DOES
FUND




            NOT, AND IS NOT INTENDED TO, CONSTITUTE A PUBLIC OFFER OF SECURITIES IN THE UNITED ARAB
            EMIRATES IN ACCORDANCE WITH THE COMMERCIAL COMPANIES LAW (FEDERAL LAW NO.8 OF 1984) AS
            AMENDED, OR OTHERWISE, AND THE UNITS IN THE FUND MAY NOT BE OFFERED OR SOLD DIRECTLY OR
E STATE




            INDIRECTLY TO THE PUBLIC IN THE UNITED ARAB EMIRATES. FURTHER, THE INFORMATION CONTAINED IN
            THIS PRELIMINARY PROSPECTUS IS NOT INTENDED TO LEAD TO THE CONCLUSION OF ANY CONTRACT OF
            WHATSOEVER NATURE WITHIN THE TERRITORY OF THE UNITED ARAB EMIRATES.

            NOTICE TO RECIPIENTS IN THE UNITED KINGDOM
REAL




            IN THE UNITED KINGDOM, THE UNITS WILL ONLY BE AVAILABLE FOR SUBSCRIPTION BY PERSONS WHOSE
            ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING OR DISPOSING OF INVESTMENTS
            (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESSES OR OTHERWISE IN CIRCUMSTANCES
ENDURANCE




            WHICH DO NOT, AND WILL NOT, CONSTITUTE AN OFFER TO THE PUBLIC IN THE UNITED KINGDOM FOR
            PURPOSES OF THE PUBLIC OFFERS OF SECURITIES REGULATIONS 1995 (AS AMENDED) OR THE FINANCIAL
            SERVICES AND MARKETS ACT 2000. IN ADDITION, THIS PROSPECTUS IS BEING DISTRIBUTED ONLY TO AND IS
            DIRECTED AT (A) PERSONS WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS
            FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL
            PROMOTION) ORDER 2001 (THE “ORDER”) OR (B) HIGH NET WORTH ENTITIES, AND OTHER PERSONS TO
THE




                                                         - vi -
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            WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED, FALLING WITHIN ARTICLE 49(1) OF THE ORDER
            (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “RELEVANT PERSONS”). THE UNITS WILL BE
            AVAILABLE ONLY TO, AND ANY INVITATION, OFFER OR AGREEMENT TO SUBSCRIBE, PURCHASE OR
            OTHERWISE ACQUIRE SUCH UNITS WILL BE ENGAGED IN ONLY WITH, RELEVANT PERSONS. ANY PERSON
            WHO IS NOT A RELEVANT PERSON SHOULD NOT ACT OR RELY ON THIS DOCUMENT OR ANY OF ITS
            CONTENTS.



            NOTICE TO RECIPIENTS IN THE UNITED STATES OF AMERICA

            THE UNITS IN THE FUND HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
            SECURITIES ACT OF 1933, AS AMENDED, (THE “SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE
            OF THE UNITED STATES AND, SUBJECT TO CERTAIN EXCEPTIONS, MAY NOT BE OFFERED OR SOLD WITHIN
            THE UNITED STATES TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS THOSE TERMS ARE
            DEFINED IN REGULATION S UNDER THE US SECURITIES ACT), THE FUND HAS NOT BEEN AND WILL NOT BE
            REGISTERED AS AN “INVESTMENT COMPANY” UNDER THE UNITED STATES INVESTMENT COMPANY ACT OF
            1940, AS AMENDED, (THE “INVESTMENT COMPANY ACT”) AND THE MANAGEMENT COMPANY IS NOT AND
            WILL NOT BE REGISTERED AS AN INVESTMENT ADVISER UNDER THE UNITED STATES INVESTMENT ADVISERS
            ACT OF 1940, AS AMENDED, AND INVESTORS WILL NOT BE ENTITLED TO THE BENEFITS OF THOSE ACTS.
            THE ATTACHED PROSPECTUS IS BEING MADE AVAILABLE ONLY TO SELECTED “ACCREDITED INVESTORS” (AS
            DEFINED IN RULE 501(a) OF THE US SECURITIES ACT) WHO ARE “QUALIFIED PURCHASERS” (AS DEFINED IN
            SECTION 2(a)51 OF THE INVESTMENT COMPANY ACT).

            NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER SECURITIES COMMISSION OR
            REGULATORY AUTHORITY IN THE UNITED STATES HAS APPROVED OR DISAPPROVED OF THE UNITS IN THE
EUROPE




            FUND OR DETERMINED WHETHER THE ATTACHED PROSPECTUS IS ACCURATE OR COMPLETE. ANY
            REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE. THE UNITS IN THE FUND MAY BE OFFERED,
            SOLD, PLEDGED, DELIVERED OR OTHERWISE TRANSFERRED OUTSIDE THE UNITED STATES ONLY IN
            “OFFSHORE TRANSACTIONS” TO PERSONS THAT ARE NOT U.S. PERSONS (AS THOSE TERMS ARE DEFINED IN
            REGULATION S UNDER THE US SECURITIES ACT), AND IN THE UNITED STATES ONLY TO A LIMITED NUMBER
CENTR AL




            OF ACCREDITED INVESTORS WHO ARE QUALIFIED PURCHASERS, IN EACH CASE UNDER CIRCUMSTANCES
            WHICH THE FUND DETERMINES WILL SATISFY THE REQUIREMENTS FOR A PRIVATE PLACEMENT UNDER
            SECTION 4(2) OF THE US SECURITIES ACT AND AN EXEMPTION FROM THE INVESTMENT COMPANY ACT.
FOR
FUND
E STATE
REAL
ENDURANCE
THE




                                                        - vii -
                                                                                         CONFIDENTIAL




            Table of contents


            1. Executive Summary ................................................................. 1
                Executive Summary of Principal Terms                                                       2


            2. Investment Highlights .............................................................. 5
                Exposure to EU Accession Countries                                                         5
                Sponsor’s Experience                                                                       5
                Investment Strategy                                                                        5
                Target Returns                                                                             6
                Tax Efficient Structuring                                                                  6
                Sponsor’s Commitments                                                                      6


            3. Investment Strategy and Guidelines ........................................ 7
                The Real Estate Opportunity in the Target Markets                                          7
                Asset and Country Sector Weighting                                                         7
                Product Strategy                                                                           7
                Investment Considerations                                                                  8
EUROPE




            4. The Sponsor ............................................................................ 10
                History and Organisation                                                                  10
                Existing Property Portfolio                                                               10
                Financial Performance                                                                     10
CENTR AL




            5. Structure................................................................................. 12
                Administrative Structure                                                                  12
                Governance Structure                                                                      14
FOR




                Investment Structure                                                                      17


            6. General ................................................................................... 19
FUND




                Description of the Units                                                                  19
                Subscription Matters                                                                      19
                Transfer of Units and Transfer Restrictions                                               22
E STATE




                Repurchase of Units                                                                       23
                Distribution                                                                              23
                Valuation                                                                                 25
                Charges of the Fund                                                                       25
REAL




                Conflicts of Interest                                                                     27
                Principal Fund Documentation, Amendments of the Fund Documents and Reporting              27
ENDURANCE




            7. Risk Factors and Investment Considerations .......................... 29
                General Business Considerations                                                           29
                Country and Market Considerations                                                         31
                Real Estate Considerations                                                                32
THE




                                                         - viii -
                                                                                             CONFIDENTIAL




                 Potential Conflicts of Interest                                                               34
                 ERISA Considerations                                                                          34
                 Certain Additional United States Legal Matters                                                36

            A. Management Resumes ....................................................................A1

            B.   Definitions .................................................................................. B1

            C.   Management Regulations ................................................................C1
EUROPE
CENTR AL
FOR
FUND
E STATE
REAL
ENDURANCE
THE




                                                            - ix -
                                                                                   CONFIDENTIAL




            Overview
            Management Company
            ENDURANCE REAL ESTATE MANAGEMENT COMPANY S.A.
            69, route d'Esch
            L-1470 Luxembourg
            Grand Duchy of Luxembourg

            Board of Directors of the Management Company

            Mr Jean-François Ott, 120 Boulevard Maurice Barrès Neuilly sur Seine, France
            Mr Luc Leroi, 8, boulevard Emmanuel Servais, L-2535 Luxembourg, Grand Duchy of
            Luxembourg
            Dr. Christoph Manthe, Anglicka 26, CZ-12000 Prague 2

            Fund Manager
            Orco Property Group S.A.
            8, Boulevard Emmanuel Servais
            L-2535 Luxembourg
            Grand Duchy of Luxembourg

            Central Administration Agent
            Dexia Banque Internationale à Luxembourg
EUROPE




            69, route d'Esch
            L-2953 Luxembourg
            Grand Duchy of Luxembourg

            Custodian
CENTR AL




            Dexia Banque Internationale à Luxembourg
            69, route d'Esch
            L-2953 Luxembourg
            Grand Duchy of Luxembourg
FOR




            Paying Agent
            Dexia Banque Internationale à Luxembourg
            69, route d'Esch
FUND




            L-2953 Luxembourg
            Grand Duchy of Luxembourg
E STATE




            Registrar and Transfer Agent
            First European Transfer Agent
            5, rue Thomas Edison
            L-1445 Strassen
            Grand Duchy of Luxembourg
REAL
ENDURANCE
THE




                                                       -x-
                                                                                    CONFIDENTIAL




            Legal Adviser

             Legal Advisers as to matters of Luxembourg law     Legal Advisers as to matters of UK law
             Kremer Associés & Clifford Chance                  Clifford Chance LLP
             4 Place de Paris                                   200 Aldersgate Street
             B.P. 1147                                          London EC1A 4JJ
             L-1011 Luxembourg                                  England
             Grand-Duché de Luxembourg

            Auditor
            Ernst & Young, Société Anonyme, Réviseurs d’entreprises
            7, parc d’Activité Syrdall
            L-5365 Munsbach
            Grand Duchy of Luxembourg

            Auditor of the Management Company
            Ernst & Young, Société Anonyme, Réviseurs d’entreprises
            7, parc d’Activité Syrdall
            L-5365 Munsbach
            Grand Duchy of Luxembourg
EUROPE
CENTR AL
FOR
FUND
E STATE
REAL
ENDURANCE
THE




                                                       - xi -
1. Executive Summary
ORCO, a public property company focused exclusively on Central Europe, is offering an
opportunity to invest in the ENDURANCE Fund, a new privately-owned property fund focused
on investment in Central Europe. The Fund will be established as a closed-end mutual fund
(Luxembourg Fonds Commun de Placement or FCP) subject to the 1991 Law. To the extend
that there are no particular provisions in the 1991 Law, the provisions of the 2002 Law apply.
JPMorgan is acting as the exclusive placement agent for the Fund.
The following are key factors in evaluating the opportunity to invest in the Fund:
 Exposure to EU accession countries: The impact of EU accession on the real estate
  markets in the Target Markets is expected to be positive, thereby providing new
  opportunities for real estate investors such as the ENDURANCE Fund.
 Sponsor’s expertise: Through the ENDURANCE Fund, investors will be able to benefit from
  the Sponsor’s real estate transaction and management expertise in the Target Markets.
  ORCO has in excess of 10 years’ experience of transacting, developing and managing real
  estate in Central Europe and has local offices staffed largely with Central European
  personnel in each of the Target Markets.
 Investment strategy: The Fund will focus on a “core-plus” strategy of acquisition,
  development, refurbishment and realisation of office, retail properties and and distribution
  centersand portfolios situated in advantageous locations in the Target Markets. A “core
  plus” strategy refers to investment in superior quality real estate having a stabilized cash
  flow, but with potential to add value through active asset management, which may involve
  some re-tenanting, expansion and reorganisation of the building layout, renovation of the
  building fabric and structure, and other forms of income/capital enhancement. The Sponsor
  has identified and are maintaining a pipeline of potential acquisitions for the Fund in these
  markets.
 Target returns: The Fund’s net Internal Rate of Return (leveraged and after taxes and all
  fees) is targeted to be in the range of 17.5 to 20% over a seven-year life of the Fund. This
  IRR shall be achieved through a combination of the initial asset yields, leverage within the
  limits set in the Fund's Management Regulations, income flow, rental growth, active
  management as part of the core plus strategy, and potential yield shift on exit.
 Fund structure and governance: The Fund has been structured in what is intended to be a
  tax-efficient way.    The governance structure is designed to ensure a smooth
  implementation of the investment strategy and Investment Guidelines.
 Sponsor’s commitment: The Sponsor will subscribe on or prior to the Final Closing Date for
  Class B Units representing a Commitment equal to minimum 5 % of the Committed Funds,
  thereby aligning their interests with those of other Unitholders.




                                              -1-
Executive Summary of Principal Terms
The following is a brief summary of the Fund’s principal terms and is qualified in its entirety
by reference to the more detailed Sections 5 and 6 of this Prospectus.

The Fund
The ENDURANCE Fund is a commingled, finite-life real estate fund formed to acquire,
refurbish and realise large office and retail properties or portfolios situated in advantageous
locations in the Target Markets.

Legal Structure
Luxembourg Fonds Commun de Placement (FCP) subject to the 1991 Law. To the extend there
are no particular provisions in the 1991 Law, the provisions of the 2002 Law apply.

Reference currency
The Fund will be denominated in, and the reference currency will be, the Euro.

Target Fund Size
Approximately €100 million of Committed Funds in one or more closings by way of
subscriptions to the Fund. The Management Company reserves the right to accept
Commitments totalling less than, or in excess of, this amount.

Subscription
Investors wishing to subscribe for Units must execute a Subscription Agreement. The
Management Company may offer different classes of Units, which may carry different rights
and obligations, inter alia, with regard to their distribution policy, their fee structure, their
minimum initial investment or their target investors. Such classes of Units may be launched
from time to time upon decision by the Management Company Board in its discretion.
Currently the Fund is offering investors the opportunity to subscribe for Class B Units. The
Fund will also issue Class A Units which will be reserved for the Sponsor.

Minimum Subscription
Euro 5 million (unless the Management Company in its discretion decides to accept lesser
subscription amounts).

Commitment Period
The Commitment Period shall last for 36 months from the Initial Closing Date. After the end
of the Commitment Period, Unitholders will be released from any further obligation with
respect to the remaining Uncalled Commitments, save as provided under Section 6 of this
Prospectus and the Management Regulations.

Fund Management Fees
The Fund Manager shall be paid an annual management fee in an amount equal to maximum
2% of the invested Funds Transaction Fees
The Fund Manager will also be paid a fee in respect of the Real Estate Assets acquired or
disposed of by the Fund, equal to 1.0% of the Transactional Value paid or received by the Fund
in respect of each such acquisition or disposal, exclusive of real estate transfer tax.

Property Management Fees
Each Property Manager will, with respect to its property management functions, receive a
property management fee based on market rates depending on the location, size and



                                              -2-
complexity of each property. To the extent not recoverable from tenants through any service
charges, such fees shall be paid by to the Fund.
As the Management Company deems appropriate, the Property Manager will receive a project
management fee based on market rates depending on the location, size and complexity of
each project.
The Property Manager shall arrange for the renewal of existing tenancies and for the re-leasing
of premises becoming vacant. In those cases where the renewal or re-leasing is handled in-
house and negotiations are required a fee of 7.5% of gross rental income anticipated for year 1
of the new lease shall be payable. In those cases where the work is handled by a third party
the Fund shall reimburse such market level fees and marketing charges at cost.

Distributions
Subject to the following paragraph concerning reinvestment of net proceeds attributable to
the realisation of an investment, any net proceeds attributable to the realisation of an
investment together with any interest and other income in respect of such investments shall
be distributed following satisfaction of all expenses and liabilities of the Fund, promptly to the
Unitholders in the following order of priority:
a) Firstly, 100% to the Class B Unitholders, pro rata to their respective Contributed Capital,
   until the cumulative amount distributed to the Class B Unitholders equals the aggregate of
   the following:
    i)   the Contributed Capital of all Class B Unitholders; and
    ii) an Internal Rate of Return of 17.5%.
b) Secondly, 75% of the Class B Unitholders, pro rata to their respective Contributed Capital,
   and 25% to the Class A Unitholders pro rata to the number of Class A Units held by them,
   until the cumulative amount distributed to the Class B Unitholders under a) and b) equals
   the aggregate of the following:
    i)   the Contributed Capital of all Class B Unitholders; and
    ii) an Internal Rate of Return of 20%; and
c) Thirdly, thereafter, 65% to the Class B Unitholders, pro rata to their respective
   Contributed Capital, and 35% to the Class A Unitholders, pro rata to the number of class A
   Units held by them,
provided that in the event that any Call Notice is issued after the Fund has reached the
distribution stages described in paragraph b) or c), paragraphs a), b) and c) will apply
sequentially to all subsequent distributions with such adjustments to be made by the
Management Company as it deems necessary in order for all distributions cumulatively to
comply with such provisions.
The Internal Rate of Return will be calculated as stipulated in the Management Regulations.
For the avoidance of doubt, all references to the Class B Unitholders in the present Section
shall exclude any Defaulting Unitholders.

Reinvestments
Net disposal proceeds received during and within one year after the expiration of the
Commitment Period may be re-invested so long as 90% of Committed Funds have been and are
for the time being applied by the Fund for the purposes of investments other than Temporary
Investments.




                                               -3-
Leverage
The maximum leverage of the Fund will be 70% in terms of total indebtedness of the Fund (on
a consolidated basis)-to-gross asset value throughout the life of the Fund. Leverage in respect
of individual assets may be higher or lower than 70% of the individual asset value but shall not
in any event exceed 80% of such value.

Cash Flow Distribution
The Fund will seek to maximise post tax distributions of cash flow to Unitholders.

Term of Fund
The Fund shall terminate seven (7) years from the Initial Closing Date (subject to possible
extension for up to two years), in certain limited circumstances upon the vote of a Qualified
Majority of Unitholders, or upon the liquidation of all of the Fund’s investments, whichever is
the sooner.

Exit Strategy
Exit strategies shall include individual or portfolio sales, and/or an initial public offering or
listing (or merger1 with a public entity).

ERISA considerations
Purchases and transfers of Units, will be restricted so that at no time Benefit Plan Investors
own 25% or more of the interests in the Fund (as determined in accordance with applicable
provisions of ERISA). See “Certain ERISA and Other Considerations” in Section 7 of this
Prospectus.




1
  There is no possibility of merger in the legal sense as the FCP is not a legal entity; however it is possible under
certain conditions (Unitholders’ and CSSF consents) for the Unitholders to contribute their Units in the Fund to
another undertaking for collective investment (UCI), with subsequent liquidation of the Fund, which operations will de
facto have similar effects as a merger.




                                                        -4-
2. Investment Highlights
The following are some of the key factors in evaluating the opportunity to invest in the Fund:

Exposure to EU Accession Countries
The accession of the Czech Republic, Hungary, Poland and Slovakia to the EU is widely
expected by observers to contribute further to the progress these countries have achieved in
recent years in establishing market economies based on appropriate legislative framework,
increased competition and further integration into world markets. These developments are
expected to impact favourably on the real estate markets by generating demand for quality
real estate in the Target Markets.
The potential cyclical change in the real estate markets of the Target Markets, combined with
the convergence process triggered by the Target Markets’ EU accession and potential future
EMU membership is creating a momentum that the Fund will seek to exploit.

Sponsor’s Experience
ORCO has in excess of 10 years’ experience of transacting, developing and managing real
estate in Central Europe. ORCO was listed on the Euronext Stock Exchange in 2000 and is a
public real estate company specifically dedicated to the region.

ORCO’s Local Presence and Network of Relationships
The Fund has been designed to capitalise on ORCO’s acquisitions, developments and
commercialisation of real estate in the Target Markets in the past 10 years and its existing
local platform which includes a network of offices in Prague, Budapest, Bratislava, and
Warsaw, as well as business relationships maintained through these offices in all the Target
Markets. Since 1991, ORCO has acquired and developed in excess of 40 properties in Prague,
Budapest, Warsaw and other Central European cities with a total combined value of €178
million as at 31.12.03.

Management Personnel Dedicated to the Fund
The management team and resources include a wide range of international real estate
expertise, including knowledge, skills and experience in real estate investment, management
and development, investment research and strategy, corporate finance and capital market
transactions in the Target Markets. Jean-Francois Ott, CEO of ORCO, Ales Vobruba, Steven
Davis and Dr. Christoph Manthe have more than 10 years of experience in property
acquisitions, development and re-development in the Target Markets.

Investment Strategy
The Fund will focus on a “core-plus” strategy of acquisition, development, refurbishment and
realisation of large office,retail properties and distribution centers and portfolios situated in
advantageous locations in the Target Markets. A “core plus” strategy refers to investment in
superior quality real estate having a stabilized cash flow, but with potential to add value
through active asset management, which may involve some re-tenanting, expansion and
reorganisation of the building layout, renovation of the buiding fabric and structure, and other
forms of income/capital enhancement. The Sponsor has identified and are maintaining a
pipeline of potential acquisitions for the Fund. The Fund will seek to add value and achieve
its target equity returns through current cash yields, capital appreciation, selective
developments within the Investment Guidelines, use of leverage and exit strategies. The Fund
will have a maximum leverage of 70% in terms of total indebtedness of the Fund (on a
consolidated basis)-to-gross asset value throughout the life of the Fund.



                                              -5-
A Considered Investment Strategy
The Sponsor will source potential transactions and identify market opportunities through on-
the-ground coverage of the Target Markets, primarily using ORCO’s local office network.
These will be periodically reviewed, taking into account the respective Target Markets’
economies and real estate fundamentals. The Fund will assess the macro-economic and
property market fundamentals in the region in order to establish the assets’ geographic
weighting. The Fund also will take advantage of its capital resources to generate interest
from potential property sellers in the Target Markets. Recognising the potential shortage of
such quality products, the Fund may be involved in development and/or refurbishment
projects that are substantially pre-let, within pre-defined limits of up to 20% of Committed
Funds. The Fund will also target large sale-and-leaseback portfolio transactions from large
financial institutions, corporations or public authorities provided that the underlying real
estate is of good quality. In order to maximise returns, the Fund will use leverage and
carefully plan and execute its exit strategies.

Identified Pipeline
The Sponsor has already identified a pipeline of several potential acquisitions of properties or
portfolios, the parameters of which correspond to the Investment Guidelines. These assets
are either on sale or should be available soon. Although some of these properties are likely to
have been sold by the time the Fund is closed, they are nonetheless indicative of the type and
size of properties that will be targeted by the Fund.

Target Returns
The Fund will seek to maximise total returns through timely investments, the use of leverage
and the active management of properties in the Target Markets. The Fund’s net internal rate
of return (leveraged and after taxes and all fees) is targeted to be in the range of 17.5 to 20%
over the seven-year life of the Fund. This IRR shall be achieved through a combination of the
initial asset yields, leverage within the limits set in the Fund's Management Regulations,
income flow, rental growth, active management as part of the core plus strategy, and
potential yield shift on exit.

Tax Efficient Structuring
The Fund will seek to structure its investments in a manner that is tax efficient for Unitholders
with respect to generated income, the distribution of dividends, the acquisition and disposal
of assets and the after-tax distributable cash flow to Unitholders.
Prospective investors should consult with their own tax advisors as to the consequences of
making an investment in the Fund.

Sponsor’s Commitments
The Sponsor will subscribe on or prior to the Final Closing Date for Class B Units representing a
Commitment equal to minimum 5 % of the Committed Funds, thereby aligning their interests
with those of other Unitholders. In addition, the promote structure has been designed to
maximise the Managers’ incentive to achieve the targeted returns.




                                              -6-
3. Investment Strategy and Guidelines

The Real Estate Opportunity in the Target Markets
The Fund’s geographical investment focus is on the Central European EU accession countries,
Czech Republic, Hungary, Poland, Slovakia. In each of these Target Markets, the Fund’s
Sponsor has an existing local execution platform. Furthermore the Fund will focus on future
EU countries Bulgaria and Romania. The Sponsor believes that short-term Central European
property fundamentals are currently attractive and present positive dynamics driven by EU
accession, the drive towards euro membership and the economic growth forecasts as well as
the current cyclical position of the various property markets.

Asset and Country Sector Weighting
The Fund Manager will monitor and analyse the political, economic and property fundamentals
of each asset sector and each Target Market in order to assess the relevant risks and
determine the weighting of asset allocation between individual asset sectors and countries.
The Fund will target individual assets that range in size between €10 and €50 million.
Investments in an individual asset may at the date of acquisition not exceed 20% of the Fund’s
net assets although this limit will not apply during a starting period which will not extend
beyond four years after the Final Closing Date. The percentage of properties owned for
development shall not exceed 20% of the Committed Funds of the Fund at any one time.

Product Strategy
Office
In the office sector, the Fund will focus on centrally-located, income-producing assets that are
at least 70% leased.

Retail
In the retail sector, the Fund will focus on the acquisition of either commercial galleries, or
central properties in the capital cities and the largest regional cities of the Target Markets
that are at least 70% leased.
Distribution centers, logistics and industrial
In this sector, the Fund will focus on well located income-producing assets that are at least
70% leased.
Mixed schemes
The Fund will invest in real estate assets of the mixed type which might inter alia include
hotels.

Development
The Fund may be involved in substantially pre-let office and retail development projects,
potentially in partnership with developers capable of delivering Real Estate Assets subject to
the Investment Guidelines.

Corporate Portfolios
The Fund will also target large sale-and-leaseback portfolios from large financial institutions
and corporations or public authorities.




                                                 -7-
Residential Properties
The Fund will invest in residential properties in the Target Markets. The Fund will focus on
acquisition, strategically balanced across the Target Markets and the sustained disposal of
assets into three sales phases: tenant privatisation, sales to investors, bulk sale of the
remaining assets:
       1. Tenant privatisation entails individual residential units sold to the respective tenants
          or private buyers at open market prices over the entire term of the Fund.
       2. Buildings with several residential units or blocks of buildings will be sold to private
          investors.
       3. The remaining assets will be sold to opportunistic investors such as developers or lent
          from time to time.

Investment Considerations
The Fund will invest through special purpose vehicles and intermediary holding companies,
depending on the requirements of local law, tax considerations and commercial requirements.
For larger projects, including developments, the Fund may seek to enter into joint ventures
with local operators/developers and/or financial partners.
The interests in the properties being acquired will be freehold ownerships, perpetual usufruct
or similar, or a leasehold ownership with not less than 30 years left to run.

Commitment Period
It is intended that the Management Company will draw down Uncalled Commitments from
Unitholders on a quarterly basis during the Commitment Period. The Commitment Period will
be 36 months from the Initial Closing Date. To facilitate the acquisition of assets pending draw
down from the Unitholders, the Fund may enter into a credit facility or a bridging loan
facility.

Distribution and Exit Strategy
The Fund will seek to maximise distributions of cash flow to Unitholders through current cash
yields and asset sales during the latter part of the life of the Fund. The Fund’s objective with
respect to exit strategy is primarily to buy-and-sell or build-and-sell within a limited time
horizon (typically three or five years). To achieve this objective, the Fund’s management
intends to follow a disciplined approach to formulating, continually re-evaluating and
implementing exit strategies for the Fund’s investments. Exit alternatives should be enhanced
by the Fund’s focus on institutional quality assets. Exit strategies include individual asset or
portfolio sales, and/or an initial public offering or listing (or merger2 into a public entity).

Acquisition of Properties
Early identification of potential transactions through existing contacts and the local platform,
along with the availability of capital and the Fund’s market position, are expected to result in
the Fund being at an advantage in the marketplace to capture investment opportunities. The
Sponsor has developed and maintained a pipeline of potential investments corresponding to
the Fund’s parameters throughout the Target Markets.




2
    There is no possibility of merger in the legal sense as the FCP is not a legal entity; however it is possible under
     certain conditions (Unitholders and CSSF consents) for the Unitholders to contribute their Units in the Fund to
     another undertaking for collective investment (UCI), with subsequent liquidation of the Fund, which operations will
     de facto have similar effects as a merger.




                                                          -8-
Leverage
The Fund will use leverage to enhance the returns as well as to take advantage of the terms
and conditions currently available for construction and long term debt in the Target Markets.
Western and local banks have been expanding their services within the Target Markets and are
currently able to offer real estate financing with low margins and long maturities. Margins
have reduced over the past three years as terms have moved towards those available in
Western Europe. The maximum leverage of the Fund will be 70% in terms of target
indebtedness of the Fund (on a consolidated basis)-to-gross asset value and will be on a non-
recourse basis to the Unitholders. However, indebtedness incurred by the Fund or one of its
subsidiaries for an individual asset may exceed 70% of individual asset value but shall not in
any event exceed 80% of such value.




                                             -9-
4. The Sponsor

History and Organisation
ORCO is a public property company focusing exclusively on Central Europe. ORCO was
incorporated in 1993 when Jean-François Ott, ORCO’s founder and CEO, made the company’s
first investment in Prague. Since that time, the company has acquired and/or developed over
€134 million (as of 31 December 2002) worth of properties in Central Europe. From of its
initial base in Prague, the company started a regional expansion of its activities. The
company has offices in Paris, Prague, Budapest, Warsaw, Bratislava and Luxembourg. ORCO’s
local platform is supported by business relationships maintained through these offices.
ORCO is a Luxembourg “société anonyme” company listed on the Euronext Stock Exchange in
Paris since December 2000 (ORC FP). The share capital of the company as of 31 December
2004 was € 18 953 578,40. The company is run by a board of eleven Directors out of which Mr
Ott is President & CEO.

Existing Property Portfolio
ORCO has established a track record of more than 40 acquisitions, financing, re-financing,
development, management and dispositions transactions in Prague, Budapest, Warsaw and
other Central European locations. The portfolio is composed of office buildings leased to large
companies and international institutions, serviced luxury apartments leased mainly to
expatriates, extended-stay hotels under the label of “MaMaison Résidence”, and luxury hotels.
The Property Management Department of ORCO manages the Group’s property assets.
Orco has concluded Joint Ventures with EBRD, GE Capital and TriGranit
Exhibit 4.3

 ORCO—composition of property portfolio as of 31 December 2003



               Extended stay
                  hotels 23%              Offices 27%




                 Luxury hotels           Residential 21%
                          29%


                                   Total= €178million
Source: ORCO




Financial Performance
ORCO’s turnover for 2003 amounted to 22.780 KEUR and was guaranteed mainly from offices
2.091 KEUR, residential buildings 1.446 KEUR, luxury hotels 4.954 KEUR, extended stay hotels
1.296 KEUR and promotion 12.565 KEUR. In terms of geography 89,25% of turnover was
generated from the Czech Republic, 9,25% from Hungary, and 1,5% from other countries.
ORCO’s turnover increased between 2002 and 2003, from 10.059 KEUR to 22.780 KEUR. Net
profit for 2003 amounted to 252 KEUR.




                                             - 10 -
2003 closes with a positive operating income of 3.196 KEUR against 3.096 KEUR in 2002. The
sale of 50% of the Kosik project to an institutional investor, the sale of 12 apartments of the
Americka 1 project in Prague and the positive margin generated in 2003 on IPB Real’s turnover
largely participated to this result.
Exhibit 4.4

Summary financial highlights of ORCO (€ million)


                                                  2003             2002
  Income from operations                          26.9             14.8
  Turnover                                        22.7             10.0
  Own production                                  1.0              1.4
  Disposal of fixed assets                        2.5              3.4


  Operating profit                                3.2              3.1
  As % of sales                                   11.9%            20.9%
  Net profit                                      0.25             2.5
  As % of sales                                   1%               16.9%


  Net asset value per share (€)                   29.5             27.32
Source: ORCO financial statements, 2 April 2003



Additional information on ORCO can be found on the internet: www.orcogroup.com .




                                                          - 11 -
5. Structure

Administrative Structure
FCP
The Fund was established on 14 March 2005 by the Management Company, as a closed-ended
mutual fund (Luxembourg Fonds Commun de Placement or “FCP”) subject to the 1991 Law. To
the extend there are no particular provisions in the 1991 Law, the provisions of the 2002 Law
apply. It has been established for a limited duration. The net assets of the Fund must reach
Euro 1,250,000 within the first six months following its authorisation. The Fund does not have
legal personality and, therefore, the management of the Fund is vested in the Management
Company in accordance with Luxembourg law and the Management Regulations.

Management Regulations
The Fund is governed by the Management Regulations which are entered into by the
Management Company and the Custodian and have been deposited with the Registrar of the
Luxembourg District Court on 18 March 2005 and have been published by reference in the
Mémorial on 23 March 2005.
The Management Regulations are set out in Appendix C of this Prospectus and form an integral
part of this Prospectus.
The execution by an investor of a Subscription Agreement constitutes the investor’s
acceptance of the Management Regulations. In the event of any inconsistency between the
Management Regulations and this Prospectus, the Management Regulations shall prevail.
The Management Regulations may be amended by the Management Company at any time in
accordance with Luxembourg law and the Management Regulations, provided that any such
amendment is published by reference in the Mémorial.

Management Company
The Management Company, which is owned by the Sponsor, has been incorporated in the
Grand Duchy of Luxembourg, for an unlimited duration, in the form of a Luxembourg limited
liability company (société anonyme), on 17 December 2004, by notarial deed published in the
Mémorial on 26 January 2005. The articles of incorporation of the Management Company have
been deposited with the Registrar of the District Court of Luxembourg under the number RC B
105.344. The paid-up capital of the Management Company amounts to Euro 125,000.
The Management Company Board is composed of three members. The Chairman of the
Management Company Board will initially be Jean-François Ott of ORCO. The other members
of the Management Company Board are Luc Leroi of ORCO and Dr. Christoph Manthe of ORCO.
For further details on the members of the Management Company Board please refer to
Appendix A “Management Resumes”.
The Management Company Board is the main governing body of the Fund.

Fund Manager
The Management Company has delegated the fund management responsibilities to ORCO as
the Fund Manager. The Fund Manager will, subject to the overall supervision and liability of
the Management Company, inter alia, manage the Fund’s assets in accordance with the
Investment Objectives, Investment Guidelines and Investment Restrictions of the Fund and in
this regard the Fund Manager will provide the services outlined in more detail herein.




                                            - 12 -
Property Manager
The Management Company will delegate, upon the recommendation of the Fund Manager and
subject to the approval of the Fund Manager, property management functions on an asset-by-
asset basis, according to the size, nature and location of the relevant property. An Affiliate of
the Fund Manager will be nominated as the Property Manager provided it has the local
property management experience required in respect of the relevant Real Estate Asset.

Custodian
The duties of custodian have been entrusted to Dexia Banque Internationale à Luxembourg.
Dexia Banque Internationale à Luxembourg was incorporated in Luxembourg as a public limited
company (société anonyme) on 8 March 1856 and has its registered office at 69, route d’Esch,
L-2953 Luxembourg. It is licensed to engage in all banking operations under Luxembourg law.
The Custodian will carry out the ordinary duties of a fund custodian regarding custody, cash
and securities deposits and shall use due care in the exercise of such functions. In particular,
in accordance with instructions given by the Management Company, the Custodian will
execute financial transactions and provide banking facilities for the Fund.
In addition, the Custodian will:
a) ensure that the sale, issue, transfer, repurchase and cancellation of the Units effected on
   behalf of the Fund are carried out in accordance with applicable law and with the
   Management Regulations;
b) ensure that the value of the Units is calculated in accordance with the Management
   Regulations;
c) carry-out the instructions of the Management Company, unless they conflict with
   applicable law or the Management Regulations;
d) ensure that in transactions involving the assets of the Fund, any consideration is remitted
   to it within the settlement dates; and
e) ensure that the income attributable to the Fund is applied in accordance with the
   Management Regulations.
The Custodian may entrust the safekeeping of all or part of the assets of the Fund, in
particular securities traded abroad or listed on a foreign stock exchange or admitted to
recognised clearing systems such as Clearstream Banking or Euroclear, to such clearing
systems or to correspondent banks. The Custodian’s liability to the Management Company and
the Unitholders shall not be affected by the fact that it has entrusted the safekeeping of all or
part of the assets in its care to a third party.

Central Administration Agent
The duties of central administration agent have been entrusted to Dexia Banque Internationale
à Luxembourg.
The Central Administration Agent is responsible for all administrative duties required in
respect of the Fund by Luxembourg law, including bookkeeping and calculation of the NAV per
Unit in accordance with the Management Regulations.

Paying Agent
The duties of paying agent have been entrusted to Dexia Banque Internationale à Luxembourg.
The Paying Agent is responsible for receiving payments for subscriptions for Units and
depositing such payments in the Fund's bank account. If applicable, upon and in accordance
with, the instructions of the Management Company Board, the Paying Agent shall execute




                                              - 13 -
distribution payments or arrange for distribution payments to Unitholders and, if appropriate,
in accordance with the instructions of Unitholders or the Registrar and Transfer Agent (as the
case may be), issue cheques or warrants, subject however to funds being available to effect
such payments, and shall notify the Management Company of the amounts and payees of all
instruments of payments so made. The Paying Agent shall make payment or cause payment to
be made of proceeds from the repurchase of Units, but only after all the conditions described
in these Management Regulations have been satisfied.

Registrar and Transfer Agent
The duties of registrar and transfer agent have been entrusted to First European Transfer
Agent S.A., Luxembourg.
First European Transfer Agent S.A., which is an affiliate of and controlled by Dexia Banque
Internationale à Luxembourg, was incorporated in Luxembourg in 1994 and has its registered
office at 11, boulevard Grande-Duchesse Charlotte, Luxembourg.
The Registrar and Transfer Agent is responsible for handling the processing of subscriptions for
Units and dealing with any transfers or redemptions of Units, in each case in accordance with
the Management Regulations, and in connection therewith accepting transfers of funds,
safekeeping of the register of Unitholders, the mailing of statements, reports, notices and
other documents to the Unitholders, and the maintenance of a record of the Commitment and
the Contributed Capital of each Unitholder.

Governance Structure
The Management Company
The Management Company is vested with the broadest powers to administer and manage the
Fund in accordance with the Management Regulations and Luxembourg law and regulations
(including IML Circular 91/75 dated 21 January 1991) and in the exclusive interest of the
Unitholders, subject as further set out hereafter, to exercise all of the rights attaching
directly or indirectly to the assets of the Fund.
Other than as otherwise set out herein, where the Management Company or the directors of
the Management Company are referred to in this Prospectus as taking any action, it shall be
understood that the Management Company will be taking such action in its own name but shall
indicate that it is acting on behalf of the Fund.
The Management Company has delegated or will delegate the functions of fund management,
property management, administration and accounting as more fully described in the
Management Regulations and herein.

Fund Manager
The Management Company has delegated its Fund management functions to ORCO through its
offices within the Target Markets.
The Fund Manager will, subject to the overall supervision and liability of the Management
Company, have the following responsibilities:
Strategy:
    1.      Overall responsibility for determining Fund strategy.
    2.      Producing annually an annual business plan and budget.
    3.      Assessing, approving the investment/development opportunities.
    4.      Identifying, assessing and approving the value enhancement opportunities.
    5.      Reporting to Unitholders.



                                             - 14 -
   6.        Assessing and approving/obtaining approval through the Advisory Board, where
             applicable, the disposals.
Procurement:
   7.        Sourcing investment/development             opportunities   and   completing   approved
             transactions.
   8.        Fully appraising all investment and development opportunities, including the
             provision of rental, capital and IRR forecasts.
   9.        Negotiating purchase terms with vendors/developers.
   10.       Sourcing and negotiating acquisition and project financing.
   11.       Instructing and overseeing the due diligence process in respect                      of
             investment/development opportunities, including approving instruction                of
             lawyers, building surveyors, environmental consultants etc.
   12.       Implementing all value enhancement opportunities.
   13.       Carrying out a detailed appraisal for all value enhancement opportunities.
   14.       Where appropriate appointing (with the approval of the Fund Manager) external
             consultants to provide advice in respect of such opportunities.
   15.       Reviewing all reports, documentation etc. in respect of all acquisitions.
   16.       Overseeing exchange of contracts and completion of transactions.
   17.       Producing each quarter, one-year (broken down monthly) and three-year (broken
             down quarterly) capital cash flow forecasts for the Fund (including all acquisitions,
             disposals and capital expenditure/receipts).
Disposals:
   18.       Identifying potential disposals.
   19.       Instigating the disposal process (including instruction of lawyers etc.).
   20.       Negotiating and agreeing disposal terms and documentation with the purchaser.
   21.       Reviewing all reports and documentation etc.
   22.       Preparing responses to enquiries
The Fund Manager may direct the Management Company to, or alternatively may itself as
agent on behalf of the Fund, enter into agreements, deeds, contracts or any other
transactions in respect of any investment of the Fund or any disposal of an investment of the
Fund, provided that such investment or disposal shall have been approved by the Advisory
Board, where applicable, in accordance with the Management Regulations.
The Fund Management Agreement shall terminate automatically upon completion of the
liquidation of the Fund, provided that it may be terminated earlier in accordance with the
Management Regulations.

Advisory Board
The Unitholders may be represented on the Advisory Board, the composition and functioning
of which is further described in the Management Regulations.
The Advisory Board shall give its prior approval to the Management Company on the following
matters:
a) conflicts of interest referred to it by the Management Company Board pursuant to the
   Management Regulations;




                                                - 15 -
b) any acquisition by the Fund of Real Estate Assets having a gross asset value exceeding €10
   million. Such approval shall be sought when the property has been identified and has
   been approved by the Fund Manager and basic real estate information including a
   preliminary financial plan has been provided to the Advisory Board (prior to due
   diligence);
c) any disposal by the Fund of Real Estate Assets having a gross asset value exceeding €30
   million;
d) any investment in leasehold properties;
e) any acquisition or sale of Real Estate Assets where the relevant price is ± 10% of the last
   independent valuation of such asset;
f)   any property or project management fees in excess of the appropriate market rate; and
g) any investment which is outside the Investment Guidelines or is inconsistent with the
   Investment Restrictions or which uses a structure different from that contemplated by
   section 2.4 of the Management Regulations.
Any matter submitted for the approval of the Advisory Board pursuant to this section shall be
deemed to have been approved if (i) duly approved at a meeting of the Advisory Board or (ii) a
period of 21 days has elapsed from the date on which the matter was submitted to the
members of the Advisory Board by the Management Company and a majority of such Advisory
Board members have either confirmed their approval in writing or failed to respond in writing
on the matter requiring approval.
The Advisory Board shall consider and (where so provided in the Management Regulations)
shall be consulted by the Management Company on the following matters:
a) any change, modification or amendment of the Investment Guidelines or Investment
   Restrictions (which is also subject to Unitholder approval);
b) such other matters as may be referred to it by the Management Company Board.
None of the Unitholders represented on the Advisory Board nor their respective
representatives shall be liable and each will be indemnified and held harmless in accordance
with the provisions of the Management Regulations. Each Unitholder or its representatives
shall furthermore be reimbursed by the Fund for their reasonable out-of-pocket expenses
incurred in attending Advisory Board meetings.

Removal and Withdrawal of the Fund Manager
The Fund Manager may be removed at any time for Cause by the vote of a Qualified Majority
of Unitholders in accordance with the Management Regulations.
For the purposes of the foregoing “Cause” will consist of:
a) gross negligence, wilful misconduct or fraud in the discharge of the Fund Manager’s
   obligations in relation to the Fund; and
b) insolvency, administration, involuntary reorganisation or bankruptcy of the Fund Manager
   or its parent company.
The Fund Manager may, in accordance with the Management Regulations, voluntarily
terminate the Fund Management Agreement to which it is a party upon giving 12 months’ prior
written notice.
Replacement Fund Manager may be appointed in accordance with the provisions further
detailed in the Management Regulations.




                                             - 16 -
Investment Structure
FCP
As illustrated in the chart below, for tax purposes the Fund intends to hold its investments in
properties through wholly-owned intermediate entities, SOPARFIs, which in turn will own
wholly-owned local subsidiaries incorporated under the applicable legislation of the Target
Markets.


Fund structure overview




                                                                  Management
   Equity & Shareholders loans              FCP
                                                                   Company




                         Financing
        SOPARFI
                           LuxCo                                  Fund Manager

               Equity            Shareholders
                                 loans                               ORCO



              Real Estate Co


      Real Estate        Debt                              Bank



Source: Sponsor

Subsidiaries
Under Luxembourg regulation, the Fund’s use of subsidiaries is subject to the following
conditions:
a) The sole purpose of the subsidiaries shall be to directly or indirectly own investments
   acquired in accordance with the investment policy of the Fund;
b) The securities of the subsidiaries will be issued in registered form;
c) The majority of the managers of the subsidiaries are managers of the Management
   Company;
d) The accounts of the subsidiaries are audited by the Fund’s auditornor any of its affiliates;
e) In the semi-annual and annual accounts of the Fund, the subsidiaries are consolidated and
   therefore the accounts of the Fund must list the investments held via these entities.

Joint Ventures
If the Fund Manager intends to enter into any joint ventures, the participation of the Fund in
such joint ventures will be either through Luxembourg entities wholly-owned or controlled by
the Fund or through local entities wholly owned by such Luxembourg entities.




                                                  - 17 -
The joint ventures could take the form of operating companies or single purpose entities and
will be structured in order to provide that the Fund may at any time exit or realise its value in
the investment. In all cases the Fund will have significant control rights within the joint
venture entity and shall at any time be entitled, either pursuant to the terms of the joint
venture agreement or, through its ability to sell shares of its subsidiary holding the Fund’s
investment in the joint venture, to exit such joint venture. The Fund will not, pursuant to the
joint venture agreement, be obliged to sell the assets in relation thereto if such sale is not
deemed to be in the best interests of the Fund.




                                              - 18 -
6. General

Description of the Units
The Units
The Fund will issue Units in registered form only and the register of the Unitholders is
conclusive evidence of ownership. The Management Company will treat the registered owner
of Units as the absolute and beneficial owner thereof.
Units may only be offered to institutional investors within the meaning of the 1991 Law.

Unit Classes
The Management Company may offer different classes of Units which may carry different
rights and obligations, inter alia, with regard to their distribution policy, their fee structure,
their minimum initial investment or their target investors. Such classes of Units may be
launched from time to time upon decision by the Management Company Board in its
discretion, provided that the launching of additional Classes should not be detrimental to the
Fund or existing Unitholders (in which case the prior approval of a Qualified Majority of
Unitholders shall be required in accordance with the Management Regulations). Without
limitation of the foregoing proviso, no additional Class having more favourable distribution
rights or fee structures than any existing Class (excluding Class A Units) shall be launched
without the prior approval of a Qualified Majority of Unitholders in accordance with the
Management Regulations.
Unitholders of the same Class will be treated equally pro-rata to the number of Units held by
them. The amounts invested in the different Classes will themselves be invested in a common
underlying portfolio of investments.
Currently the following two (2) classes of Units will be issued:
a)      Class A Units, which will only be offered to the Sponsor; and
b)      Class B Units, which will only be offered to institutional investors, including the
     Sponsor.
Class A Units and Class B Units differ in their Initial Subscription Price and in their distribution
policy as further detailed herein.

Subscription Matters
Reference Currency
The Fund will be denominated in, and the reference currency will be, the Euro.

Target Fund Size
Approximately Euro 100 million of Committed Funds. The Management Company reserves the
right to accept Commitments totalling less than, or in excess of, this amount.

Sponsor’s Commitment
The Sponsor will subscribe on or prior to the Final Closing Date for Class B Units representing a
Commitment equal to minimum 5% of the Committed Funds, and will be treated as Class B
Unitholders in respect thereof.




                                               - 19 -
Minimum Subscription
Euro 5 million (unless the Management Company in its discretion decides to accept lesser
subscription amounts).

Issue of Units and Closings
Investors wishing to subscribe for Units must execute a Subscription Agreement, which upon
acceptance will be counter-signed by the Management Company.
The Management Company in its absolute discretion has the right to accept or reject any
application to subscribe for Units and may further restrict or prevent the ownership of Units
by specific categories of Persons.
Investors may apply to subscribe for Units at any time during the Offer Period.
The Management Company Board may decide at any time during the Offer Period to hold the
initial closing of the Fund. Notice of the Initial Closing Date will be given to investors in
accordance with the provisions of the Subscription Agreements.
During the period of six months after the Initial Closing Date, one or more subsequent closings
of the Fund may be held as the Management Company Board deems appropriate, provided that
the Management Company Board in its sole discretion may extend such six month period by up
to a further six months.
Investors admitted at the Initial Closing Date (the "Initial Investors") will be required to pay in
a percentage, as determined by the Management Company Board, of their Commitments on
the Initial Closing Date.
Investors admitted (or Unitholders increasing their Commitments) at any closing subsequent to
the Initial Closing Date will be required upon such admission to pay such percentage of their
respective Commitments as is equivalent to Contributed Capital of the Initial Investors (as a
percentage of their Commitments) plus an interest charge at six-month Euribor plus 1.0% per
annum on such amount, accruing from the Initial Closing Date or (to the extent applicable)
such later dates on which the Commitments of the Initial Investors have been drawn down.
Such interest payments will be retained and applied by the Fund and are payable in addition
to a Unitholder's Commitment.
During the Offer Period, Units will be issued by way of subscriptions for Units at the relevant
Initial Subscription Price. However in case of occurrence of an event having a substantial
impact on the value of one or more investments of the Fund, Units will henceforth be issued
on the basis of the NAV per Unit.

Commitment Period and Call Notices
During the Commitment Period, the Management Company may draw down Uncalled
Commitments from Unitholders, on a pro rata basis, in such instalments as the Management
Company considers in its sole discretion will be needed by the Fund to make investments, to
pay service provider fees and to pay any other expenses of the Fund.
Following the Final Closing Date, Unitholders will be required to pay in their Uncalled
Commitments by way of subscriptions for additional Units at the prevailing NAV per Unit,
pursuant to the terms of Call Notices issued by the Management Company.
Each Call Notice will provide for at least 15 Business Days’ prior written notice for payment by
the recipient Unitholder of an amount in Euro no greater than its Uncalled Commitment.
The Management Company may seek to put in place a bridging facility, arranged by the Fund
Manager, with a major international bank to provide for any shortfall in respect of the funds
required to proceed with investments or to cover the expenses of the Fund pending drawdown
of Commitments.



                                               - 20 -
After the end of the Commitment Period, Unitholders will be released from any further
obligation with respect to their remaining Uncalled Commitments (if any), except that the
Management Company may issue further Call Notices in respect of such Uncalled Commitments
after the end of the Commitment Period (which Unitholders shall comply with):
a)      to cover the liabilities and expenses of the Fund (including fees payable to service
     providers and any indemnification payments pursuant to Article 24 of the Management
     Regulations but excluding any payments for which the Fund is liable under any borrowing
     arrangement (except where the terms of such borrowing arrangement include recourse to
     Uncalled Commitments)); and
b)      to complete an investment in an uncompleted transaction or development project
     which the Fund has entered into a binding obligation to pursue prior to the end of the
     Commitment Period or to make follow on investments in existing transactions or projects.
Any Commitments drawn down for the purposes of making an investment shall, in the event
that the proposed investment does not proceed and to the extent that such Commitments are
not required for other purposes of the Fund within a period of three months from the relevant
drawdown date, be returned to Unitholders whereupon such Commitments shall form part of
the Uncalled Commitments and be available for subsequent drawdowns.

Call Notice Default
If any Unitholder fails to make any payment required to be made pursuant to a Call Notice by
the date required for payment in such Call Notice, the Management Company shall notify such
Unitholder in writing of its default and give such Unitholder an opportunity to remedy its
default by payment of the relevant capital amount together with such interest or other
amounts as the Management Company may prescribe in order to mitigate any loss caused to
the Fund as a result of such default.
After the expiry of a 60-day period commencing on the payment date specified in the Call
Notice, if the Unitholder has not remedied its default in accordance with the preceding
paragraph, the Management Company may (in its sole discretion) declare such Unitholder to
be a "Defaulting Unitholder".
A Defaulting Unitholder will receive no further distributions from the Fund in respect of its
Units (save as provided in the following paragraph) and its right to attend and vote at
Unitholder meetings and (if applicable) Advisory Board meetings shall be removed.
The Defaulting Unitholder will furthermore be excluded from the right to make future
subscriptions for Units and will only be entitled to receive the lesser of (i) its Contributed
Capital or (ii) the applicable NAV per Unit in respect of the Units subscribed and paid for by
such Defaulting Unitholder, at the date of the Fund’s final liquidation distribution.

Subscription for Units
The Management Company in its absolute discretion has the right to accept or reject any
application to subscribe for Units and may further restrict or prevent the ownership of Units
by specific categories of Persons. In this respect, the Management Company may require any
subscriber to provide it with any information that it may consider necessary for the purpose of
deciding whether or not such person is eligible to subscribe for Units.
The Fund retains the right to offer only one class of Units for subscription in any particular
jurisdiction in order to conform to local law, custom, business practice or the Fund’s
commercial objectives.




                                             - 21 -
Prevention of Money Laundering
Pursuant to the Luxembourg law of 7 July 1989 to combat money laundering, to the
Luxembourg laws of 5 April 1993 and of 11 August 1998 relating to the financial sector and to
the Circulars issued by the CSSF, obligations have been imposed on all professionals of the
financial sector to prevent the use of undertakings for collective investment for money
laundering purposes.
Within this context a procedure for the identification of investors has been imposed. Namely,
the Subscription Agreement entered into by an investor must be accompanied by a copy of the
subscriber’s articles of incorporation and, where applicable, an extract from the commercial
register is required (any such copy must be certified to be a true copy of the original by one of
the following authorities: ambassador, consul, notary or police officer).
Any information provided to the Fund in this context is collected for anti-money laundering
compliance purposes only.

Transfer of Units and Transfer Restrictions
Class A Units may not be transferred except in the case of removal or withdrawal of the Fund
Manager provided that the Management Company may permit transfers of Class A Units to
Affiliates of the Sponsor as further detailed in the Management Regulations.
Subject to the provisions herebelow regarding the transfer of Committed Asset Units, Class B
Units (together with related Commitments) may not be transferred without the prior written
consent of the Management Company, which consent may be given or withheld in its
reasonable discretion. The Management Company will normally (and subject to any overriding
concerns of the nature set out below) consider it reasonable to approve transfers by
Unitholders to Affiliates thereof in circumstances where such transfer is for the purposes of
tax or intra-group restructurings. In particular (but without limitation), the Management
Company will be entitled to withhold its consent to a proposed transfer on the following
grounds:
    a) if the Management Company reasonably considers that the transfer would cause the
       Fund to be terminated;
    b) if the Management Company considers that the effect of such transfer will result in (1)
       a violation of any applicable securities law of the United States or any of the States of
       the United States or any other relevant jurisdiction; (2) the Fund being required to
       register, or seek an exemption from registration, as an investment company under the
       United States Investment Company Act of 1940; (3) a loss of partnership status for US
       Federal income tax purposes for the Fund; or (4) the Fund being considered a publicly
       traded partnership for US Federal income tax purposes;
    c) if the Management Company considers that the transfer would violate any applicable
       law, regulation or any term of these Management Regulations;
    d) if the Management Company considers that the transfer would cause or create a risk
       that the assets of the Fund could be deemed to be Plan Assets;
    e) if the Management Company considers the transferee to be a competitor of the Fund
       or the Sponsor or of inappropriate creditworthiness.
The Management Company may condition any transfer on the receipt of legal opinions and
other evidence of compliance with applicable securities and other laws.
No transfer of Units will become effective unless and until the transferee agrees in writing to
fully and completely assume any outstanding obligations of the transferor in relation to the
transferred Units (and the related Commitment) under the relevant Subscription Agreement




                                              - 22 -
and agrees in writing to be bound by the terms of this Prospectus and the Management
Regulations, whereupon the transferor shall be released from (and shall bear no further
liability for) such liabilities and obligations.
Notwithstanding the provisions hereabove, any Unitholder which is a German Insurance
Company shall have the right to dispose of all or part of its Committed Asset Units held by it to
an EU Institutional Investor without requiring the consent of the Management Company,
subject to satisfaction of the conditions set out in the Management Regulations and PROVIDED
THAT no proposed sale, assignment, transfer, exchange, pledge encumbrance or other
disposition of any Committed Asset Unit will be valid unless the Management Company shall
have first received written confirmation that such proposed disposition has been approved in
writing by the relevant Unitholder's German trustee (Treuhaender) or such trustee's authorised
deputy, pursuant to sections 70 and 72 of the Insurance Act.

Repurchase of Units
Close-end Fund
The Fund is a closed-ended fund and consequently, it does not repurchase the Units upon the
request of the Unitholders.

Limited Repurchase
Units may be repurchased by the Management Company and the relevant Unitholder may be
obliged to sell its Units to the Fund, in the sole discretion of the Management Company and
after consultation with the Advisory Board (from which meeting the Advisory Board
representatives (if any) of the Unitholder from which Units are to be repurchased shall be
excluded), in circumstances and within the conditions provided for in the Management
Regulations.

Term, Extension and Exit Strategies
The Fund shall terminate seven (7) years from the Initial Closing Date (subject to a possible
extension of two years), in certain limited circumstances upon the vote of a Qualified Majority
of Unitholders in accordance with the Management Regulations, or upon the liquidation of all
of the Fund’s investments, whichever is the sooner.
Exit strategies shall include individual asset or portfolio sales, and/or an initial public offering
or listing (or merger1 into a public entity). Any proposed exit in respect of an investment of
the Fund which is made by way of an initial public offering or listing (or merger into a public
entity) requires the approval of a Qualified Majority of Unitholders as further indicated in the
Management Regulations.

Distribution
Distributions
Subject to the following paragraph concerning reinvestment of net proceeds attributable to
the realisation of an investment, any net proceeds attributable to the realisation of an
investment together with any interest and other income in respect of such investments shall,
following satisfaction of all expenses and liabilities of the Fund, be distributed promptly to the
Unitholders in the following order of priority:
    a) Firstly, 100% to the Class B Unitholders, pro rata to their respective Contributed
       Capital, until the cumulative amount distributed to the Class B Unitholders equals the
       aggregate of the following:
           i.   the Contributed Capital of all Class B Unitholders; and




                                               - 23 -
          ii.   an Internal Rate of Return of 17.5%;
    b) Secondly, 75% to the Class B Unitholders, pro rata to their respective Contributed
       Capital, and 25% to the Class A Unitholders pro rata to the number of Class A Units
       held by them, until the cumulative amount distributed to the Class B Unitholders
       under a) and b) equals the aggregate of the following:
          i.    the Contributed Capital of all Class B Unitholders; and
          ii.   an Internal Rate of Return of 20%; and
    c) Thirdly, thereafter, 65% to the Class B Unitholders, pro rata to their respective
       Contributed Capital, and 35% to the Class A Unitholders, pro rata to the number of
       Class A Units held by them,
provided that in the event that any Call Notice is issued after the Fund has reached the
distribution stages described in paragraph b) or c), paragraphs a), b) and c) will apply
sequentially to all subsequent distributions, which such adjustments to be made by the
Management Company as it deems necessary in order for all distributions cumulatively to
comply with such provisions.
The Internal Rate of Return will be calculated in accordance with the Management
Regulations.
For the avoidance of doubt, all references to the Class B Unitholders under the present header
shall exclude any Defaulting Unitholders.

Reinvestments
Net disposal proceeds received during and within one year after the expiration of the
Commitment Period may be re-invested so long as 90% of Committed Funds have been and are
for the time being applied by the Fund for the purposes of investments other than temporary
investments.

Temporary Investments
Pending investment of Contributed Capital or distribution of investment proceeds to
Unitholders, the Fund may invest only in deposits with reputable banks and investment grade
money market instruments denominated in freely convertible currencies. The Fund will not
enter into or invest in options, futures or other derivative transactions for speculative
purposes. In order to protect its assets against currency or interest rate fluctuations, the Fund
may enter into currency or interest rate forward or futures contracts, as well as write call
options or purchase put options on currencies or interest rates, or enter into interest rate
swaps. The Fund may enter into such contracts only if traded on a Regulated Market, or if
entered into with a highly-rated financial institution specialising in this type of transaction.
The aggregate of the liabilities of the Fund relating to futures contracts, options and swap
transactions on interest rates may not exceed the aggregate estimated market value of the
assets to be hedged and held by the Fund in the currency corresponding to those contracts.

Distributions in kind
It is not contemplated that distributions of property other than cash will be made, provided
that distributions of publicly-traded securities may be made in accordance with the
Management Regulations.
Any distribution in-kind shall be taken into account for the purposes of the distributions here-
above, for the purposes of which Unitholders shall be deemed to have received a cash
distribution equal to the value of the securities distributed to them.




                                              - 24 -
Valuation
Independent valuations
At the time of acquisition the market value of each Real Estate Asset will be determined under
the supervision of the Management Company Board by an Independent Appraiser on the basis
of the Valuation Policies. Such appraisal policies and valuations will be indicated in the annual
report of the Fund.
Real Estate Assets other than Real Estate Assets acquired within six months prior to the end of
the Commitment Period will be valued at the end of the Commitment Period and thereafter on
each Valuation Date, by one or more Independent Appraisers (whose name(s) will be indicated
in the annual reports for each Fiscal Year), on the basis of the Valuation Policies. Each
valuation shall be effected under the supervision of the Management Company Board.
Real Estate Assets may not be acquired or sold unless they have been valued by an
Independent Appraiser, although a new valuation shall not be required if the sale of the asset
in question takes place within six months after the last independent valuation thereof.
Acquisition prices may not be more than 10% higher, nor sales prices more than 10% lower,
than the latest independent valuation, except with the prior approval of the Advisory Board.

Calculation of the NAV per Unit
The NAV per Unit of each Class will be expressed in Euro and shall be determined by the
Central Administration Agent under the supervision of the Management Company Board as at
each Valuation date in accordance with the provisions of the Management Regulations.

Temporary Suspension of the Calculation of NAV per Unit
The Management Company may suspend the determination of the NAV per Unit in accordance
with the provisions of and under the conditions outlined in the Management Regulations.
Any such suspension shall be published, if appropriate, by the Management Company and may
be notified to Unitholders having made an application for subscription or redemption, if any,
of Units for which the calculation of the NAV has been suspended.

Charges of the Fund
Organisational Expenses

The Fund shall reimburse all reasonable Organisational Expenses incurred by the Sponsor and
the Management Company.

Placement Fees

The Fund will pay, or reimburse the Sponsor for, all Placement Fees owing to the Placement
Agent or, as the case may be, the Sponsor or its Affiliate in connection with the placement of
Units. JPMorgan has been mandated by the Sponsor to act as the exclusive Placement Agent
for the Fund. The Placement Fee will not exceed 2.5% of the total Commitments. It is
intended that the Placement Fee in respect of each Unitholder's Commitment will be payable
by such Unitholder in addition to its Commitment and that the Fund will pass that amount of
the Placement Fee on to the relevant person entitled to payment or reimbursement of the
Placement Fee. A detailed placement fee schedule will be prepared for each Unitholder and
distributed upon the Final Closing.

Fund Management Fees
The Fund Manager shall be paid an annual management fee in an amount equal to maximum
2% of the invested Funds.



                                              - 25 -
The Fund Manager will also be paid a fee in respect of the Real Estate Assets acquired or
disposed of by the Fund, equal to 1.0% of the Transactional Value paid or received by the Fund
in respect of each such acquisition or disposal.

Property Management Fees
Each Property Manager will receive a property management fee in relation to its property
management functions to be based on market rates depending on location, size and
complexity of the relevant property. To the extent that these fees are not recoverable from
the tenants through any service charges, they shall be paid by the Fund.
When appropriate, the Property Manager will receive a project management fee to be based
on market rates depending on location, size and complexity of each project.
The Property Manager shall arrange for the renewal of existing tenancies and for the re-leasing
of premises becoming vacant. In those cases where such renewal or re-leasing is handled by
the Property Manager in-house and negotiations are required, then a fee of the lesser of (i)
7.5% of the gross rental income anticipated for the first year or (ii) the applicable market rate
of the new lease shall be payable to the Property Manager. In those cases where such work is
handled by a third party, such third party shall be paid the applicable market rate and its
expenses by the Fund.

Operation and Administration Expenses
The Fund will reimburse the Management Company and the Fund Manager for all Operation
and Administration Expenses incurred by them in relation to the Fund, subject to a maximum
of 0.40% per annum of Committed Funds.

Investment-Related Expenses
The Management Company and the Fund Manager shall be reimbursed by the Fund in respect
of all Investment-Related Expenses reasonably incurred by them.

Custodian and Other Fees
The Custodian, the Central Administration Agent, the Paying Agent and the Registrar and
Transfer Agent shall each be entitled to be paid out of the Fund’s assets, such fees as shall be
determined from time to time by agreement between the Management Company and such
service providers, provided that such fees are in accordance with customary banking practice
in Luxembourg.
Any Correspondent shall be entitled to be paid, out of the Fund’s assets, such fees as shall be
determined from time to time by agreement among the Custodian, the Correspondent and the
Management Company, provided that such fees shall be no higher than those charged for
comparable services by other banks or trust companies in the jurisdiction in which such
Correspondent operates.

Value Added Tax
All fees and expenses payable to the Fund pursuant to the above are exclusive of value added
taxes or other chargeables thereon, which shall be paid by the Fund as required.

Indemnification
The Fund will indemnify the Sponsor, the Management Company, the Fund Manager, the
Property Manager and their officers, directors, employees and associates and all persons
serving on the Management Company Board (each an "Indemnitee") against all claims,
liabilities, cost and expenses incurred in connection with their role as such, other than for
gross negligence, fraud or wilful misconduct. Unitholders will not be individually obligated




                                              - 26 -
with respect to such indemnification beyond the amount of their investments in the Fund and
their Uncalled Commitments.
The Indemnitees shall have no liability for any loss incurred by the Fund or any Unitholder
howsoever arising in connection with the service provided by them in accordance with the
Management Regulations, and each Indemnitee shall be indemnified and held harmless out of
the assets of the Fund against all actions, proceedings, reasonable costs, charges, expenses,
losses, damages or liabilities incurred or sustained by an Indemnitee in or about the conduct of
the Fund’s business affairs or in the execution or discharge of his duties, powers, authorities
or discretions in accordance with the terms of the appointment of the Indemnitee, including
without prejudice to the generality of the foregoing, any costs, expenses, losses or liabilities
incurred by him in defending (whether successfully or otherwise) any civil proceedings
concerning the Fund or its affairs in any court whether in Luxembourg or elsewhere, unless
such actions, proceedings, costs, charges, expenses, losses, damages or liabilities resulted
from his gross negligence, wilful misconduct or fraud.

Conflicts of Interest
In the event that the Fund is presented with an investment proposal involving a property
owned (in whole or in part) by either the Sponsor or any employee, officer, director or
Affiliate thereof, including any investment funds managed, advised or sponsored by the
Sponsor or its Affiliate, the Sponsor will fully disclose and refer this conflict of interest to the
Management Company Board, who will notify the Advisory Board of such conflict of interest.
The Advisory Board must approve any such proposals referred to it before the investment is
made.
All Fund transactions, including transactions involving subsidiaries or affiliates of the Fund,
shall be under terms consistent with terms of transactions entered into on an arm’s length
basis.
In the event that the Fund invests in a property or property holding company which was or is
advised by the Sponsor or its Affiliate, the terms of such advisory work shall be fully disclosed
by the Sponsor to the Management Company Board, which will notify the Advisory Board
thereof, prior to any decision being made in respect of such investment. The Advisory Board
must approve any such proposals referred to it before the investment is made.
The Sponsor will inform the Management Company Board, which will notify the Advisory Board
thereof, of any business activities in which the Sponsor or its Affiliate is involved which are
not related to the Fund and could create an opportunity for conflicts of interest to arise in
relation to the Fund’s investment activity and of any proposed Fund investments in which the
Sponsor is aware that any Unitholder has a vested interest.
In addition to the services provided by the Sponsor as described herein, Unitholders and their
Affiliates may provide services to the Fund, provided that the fees paid for such services are
customary in nature.

Principal Fund Documentation, Amendments of the Fund Documents
and Reporting
Principal Fund Documentation
The principal Fund documentation is available for inspection by the Unitholders at the
registered office of the Management Company or the Custodian. The principal Fund
documentation referred to under a) to c) and j) below may also be obtained upon request
from the Placement Agent.
The principal Fund documentation is as follows:



                                               - 27 -
a) Prospectus;
b) Management Regulations;
c) Subscription Agreement;
d) Fund Management Agreement;
e) Custody Agreement;
f)   Central Administration Agent Agreement;
g) Paying Agent Agreement;
h) Registrar and Transfer Agent Agreement;
i)   Reports issued by the Fund from time to time as detailed here-below

Amendments to the Fund documents
Amendments to the Fund Documents (the Prospectus, Management Regulations and Fund
Management Agreement) may be made from time to time with the approval of the
Management Company and a Qualified Majority of Unitholders in accordance with the
Management Regulations, provided that no amendment may increase any Unitholder’s
Commitment, reduce its share of the Fund’s distributions, or decrease the percentage of
Unitholders required to amend the Fund Documents in any manner, without the unanimous
consent of the Unitholders.
However, the Management Company may amend any Fund Document without the approval of
the Unitholders to (i) reflect changes validly made in the ownership of the Fund and the
Contributed Capital of the Unitholders, (ii) reflect a change in the name of the Fund, (iii)
make any change that is necessary or desirable to cure any ambiguity or to correct or
supplement any provision of any Fund Document that would otherwise be inconsistent with
any other provision of any other Fund Document, (iv) make a change that is necessary or
desirable to satisfy any applicable requirements, conditions or guidelines contained in any
opinion, directive, order, statute, rule or regulation of any governmental entity so long as
such change is made in a manner which minimises any adverse effect on the Unitholders, and
(v) make any other amendment that in the opinion of the Management Company may be
necessary or advisable, provided, that in each of the cases set out in (i) and (v) such
amendment does not adversely affect the Unitholders in any material respect.

Reports
The Management Company will distribute to each Unitholder the following reports:
a) on a periodic basis a pipeline report detailing potential investments for the Fund;
b) within 60 days after the end of each fiscal quarter unaudited financial statements for the
   Fund, a statement of such investor’s account, a report on the Fund’s portfolio investments
   (including value information for each asset such as buy-in price, current price guide,
   estimated gain/loss, etc.), and a detailed property management report;
c) within 60 days after the end of each fiscal half year a semi-annual report including an
   estimate of the Fund asset value and key variables; and
d) within 120 days after the end of each fiscal year, an annual report including audited
   financial statements for the Fund;
all of which will be prepared during the terms of the Fund in accordance with the valuation
rules set out in the Management Regulations and with generally accepted accounting
principles determined by the Management Company as applicable to corporate entities. All
reports will be prepared in accordance with the Global Investmenmt Performance Standards




                                             - 28 -
(“GIPS”) as adopted by the Associtaion for Investment Management and Research Board of
Governors
The Fund’s financial year ends on 30 September of each year and the first financial year of the
Fund shall begin on the creation of the Fund and shall end on 30 September 2006. The first
annual report, being an audited report is expected to be published for the period ending
30 September 2006. The first semi-annual report of the Fund, being a non-audited report is
expected to be published for the period ending 31 March 2006.



7. Risk Factors and Investment Considerations
The value of an investment in the Fund may go down as well as up and involves various risks
and investment considerations, some of which are highlighted below. The risk factors are not
intended to be exhaustive. Prior to making an investment in the Fund, prospective investors
should carefully consider all the information in the Management Regulations, this Prospectus
and the Fund documentation. The investments to be made by the Fund are speculative by
nature and there is a possibility of partial or total loss of invested capital. Investors should
not subscribe to or invest in the Fund unless they can readily bear the consequences of such
loss. In particular they should evaluate the risk factors discussed below which, individually or
in aggregate, could have a material adverse effect on the Fund or its assets and may result in
the loss of the Contributed Capital or lower returns than those discussed herein.

General Business Considerations
Foreign Investments Generally
The Fund will focus on the Target Markets. Any investment in a foreign country involves the
risk of adverse political developments, including nationalisation, confiscation without fair
compensation, acts of terrorism or war. Furthermore, foreign jurisdictions may impose
restrictions to prevent capital flight, which could make it difficult or impossible to exchange
or repatriate foreign currency. In addition, laws and regulations of foreign countries may
impose restrictions or approvals which would not exist in the investor’s country of origin and
may require financing and structuring alternatives which differ significantly from those
customarily used in the investor’s country of origin. The Fund Manager will analyse risks in the
respective Target Markets before making such investments but no assurance can be given that
a political or economic climate, or particular legal or regulatory risks, might not adversely
affect an investment by the Fund. It is likely that the risks referred to in this paragraph are
more prevalent in the Target Markets than in most developed Western Markets.

Currency Risk
The Fund will maintain its books and pay distributions in Euros. Fluctuations in exchange rates
between the Euro and the relevant local currencies may directly or indirectly affect the value
of the Fund’s portfolio and the ultimate rate of return realised by the Unitholders on their
investments in the Fund. The Fund Manager does not intend to hedge foreign exchange risks
as a matter of course.

Future Investments Unspecified
As of the date of this Prospectus, the Fund has not made any investments. Unitholders will be
relying on the Fund Manager’s ability to identify and acquire suitable investments (if any).
Such investments may be made over a substantial period of time and the Fund may face the
risk of interest rate fluctuations and adverse changes in the real estate markets.




                                             - 29 -
No Operating History
The Fund is newly formed and does not have an operating history or any track record for
investment. There is no guarantee that the Fund will realise its investment objectives or that
Unitholders will receive any return on, or the return of, their invested capital.

Unspecified Assets and Transactions
As of the date of this Prospectus, the Fund does not have any assets and has not identified any
specific assets that it will seek to acquire and manage in the future. Consequently, there is no
information as to the nature and terms of particular assets, which an investor can evaluate
when determining whether to invest in the Fund.

Reliance on Management
Management of the activities of the Fund has been delegated to the Fund Manage and the
Property Manager subject to the overall supervision of the Management Company’s Board. In
addition, the Fund Manager and the Property Manager will be relying on the experience,
relationships and expertise of the relevant business units of ORCO. Past performance of
similar investments made by individuals of the executive team of the Fund Managerand the
Property Manager is not necessarily a guide to the future performance of the Fund's
investments and the success of the Fund depends on the ability of the Fund Managerand the
Property Manager to identify, select, effect and realise appropriate investments and there is
no guarantee that suitable investments will be or can be acquired or that investments will be
successful. Further, it may not be possible to retain certain key persons, particularly the
members of the Fund Manager’s and the Property Manager’s teams or the senior management
of the Sponsor, should one or more of them cease to be involved with the Fund for any reason.

Reliance on Third Parties
The Sponsor expects that the Fund may rely on joint ventures and other relationships with
local partners and managers. Such relationships may involve risks not present in direct
property investments or in investments where a third party is not involved, including the
possibility that a third party co-venturer or partner may at any time have economic or
business interests or goals which are inconsistent with those of the Fund, or may be in a
position to take action contrary to the Investment Objectives. It may not be practicable or
possible to review the qualifications, condition or suitability of such third parties and the Fund
may in certain circumstances be liable for actions of its third party co-venturer or partner.

Competition
Although the Fund Manager believes that the Fund will be well positioned to take advantage of
attractive investment opportunities, there can be no assurance that it will in fact be so
positioned. The entry of additional investors into the segments of the real estate market in
which the Fund will focus may reduce the number of opportunities available and/or adversely
affect the terms on which investments can be made.

Illiquidity of Investments
The investments to be made by the Fund will generally be illiquid and it is unlikely that there
will be a public market for many of the investments held by the Fund. The eventual liquidity
of all investments of the Fund will be dependent upon the success of the realisation strategy
proposed for each investment which could be adversely affected by a variety of risk factors.
Realisation of the Fund’s assets on termination or otherwise could be a process of uncertain
duration and no assurances can be given that all the Fund’s investments will be able to be
liquidated prior to the scheduled expiration of the term of the Fund. Furthermore,
investments held in a joint venture may prove more difficult to realise. The realisation price
for such a joint venture stake may also differ from the open market value of the investment.



                                              - 30 -
Illiquidity of Fund Units
The Units represent highly illiquid investments and should be acquired only by investors able
to commit their funds for the Fund’s duration or an indefinite period of time. There is no
public market for the Units, and it is highly unlikely that one will develop. Transfer of Units
(other than to certain Affiliates) are also subject to the approval of the Management Company
under conditions further detailed in the Section 6 of this Prospectus. The Units may also be
affected by restrictions on resale imposed under applicable law.

Ability to Leverage
The Fund may incur external borrowings to increase potential equity performance or provide
tax advantages. The ability to leverage will be a major factor in the Fund’s ability to realise
its targeted return. Prospective investors should be aware that there can be no assurance
that the Fund will be able to secure the necessary external financing.

Risk of Leverage
The Fund may incur external borrowings in connection with its investments. Although the use
of leverage may enhance returns and increase the number of investments that can be made, it
may also substantially increase the risk of loss. The use of leverage will subject the Fund to
risks normally associated with debt financing, including the risk that the Fund's cash flow may
be insufficient to meet required payments of principal and interest, the risk that indebtedness
on the properties may not be able to be refinanced and the risk that the terms of such
refinancing may not be as favourable as the terms of the existing indebtedness. In addition,
the Fund may incur indebtedness that may bear interest at variable rates. Variable rate debt
creates higher debt service requirements if market interest rates increase, which would
adversely affect the Fund. The Fund may in the future engage in transactions to limit its
exposure to rising interest rates as it deems appropriate and cost effective, which transactions
could expose the Fund to the risk that counter-parties to such transactions may not perform
and cause the Fund to lose the anticipated benefits therefrom, which would have the adverse
effects associated with increases in market interest rates.

Targeted Returns
The Fund will make investments based on the Fund Manager’s estimates or projections of
internal rates of return. Unitholders have no assurance that actual internal rates of return
will equal or exceed the stated targeted return to the Unitholders.

Country and Market Considerations
Repatriation Restrictions
There are currently no restrictions in any of the Target Markets on repatriating income and
capital from properties, provided that the foreign investor has complied with the legal regime
on foreign investments in the Target Markets. There can however by no assurance that such
restrictions will not be imposed in the future.

Legal and Regulatory Risks
Due to the fact that the efficacy of the judicial systems in the Target Markets varies, the Fund
(or an investment made by the Fund) may have difficulty in successfully pursuing claims in the
courts of such countries, as compared to the United States of America or to other countries in
the EU. Further, to the extent that the Fund (or an investment made by the Fund) may obtain
a judgement but is required to seek its enforcement in the courts of one of the Target Markets
(or other relevant jurisdiction in which the Fund invests), there can be no assurance that such
courts will enforce such judgement.




                                             - 31 -
It is difficult to anticipate the impact of legislative and regulatory reforms on securities or
other investments in which the Fund might invest. The process of legal and regulatory reform
in the Target Markets does not always coincide with market developments and this may result
in ambiguities and inconsistencies, and, ultimately, in increased investment risk.
The regulatory environment in the Target Markets may vary but in many cases the levels of
regulatory control and oversight in respect of such matters as the environment, employee
rights, labour relations and consumer protection, as well as in matters of securities regulation
and the financial markets, are evolving and may be characterised, broadly, as less stringent
than the regulatory controls and oversight that exists in developed economies such as the
United States of America or in other countries in the EU. Standard practices, market customs
and usages have yet to evolve to those comparable in developed economies such as the United
States of America or in other countries in the EU. Where a system of regulation is present it
may lack any adequate mechanism to enforce compliance by its market participants. There is
a risk, where regulations are unclear in their scope and effect, that activities conducted in
good faith on the basis of professional advice will subsequently be regarded as not in
compliance with fiscal, currency control, securities, corporate or other regulatory
requirements.

Tax Considerations
The intention of the Fund is to structure its investments in a manner that is intended to
achieve the Investment Objectives and intended to mitigate tax charges and duties in the
countries of investment and the countries in which intermediary companies are located, taking
into account the tax laws, administrative practices, applicable double tax treaties and other
rules which should be relevant in those countries. However, there can be no guarantee that
the structure of the Fund or any investment will be tax efficient for a particular investor or
that any particular tax status will be achieved.
Tax laws are complex and quite often not completely clear, and the tax consequences of a
particular structure chosen might be questioned or might be subject to challenge by the
relevant tax authority in the country concerned. Furthermore, tax laws may change, so that
the tax consequences of a particular investment may adversely change after it has been made.
The Fund’s intermediate subsidiary companies or the Unitholders may be subject to income
taxes or other taxes in multiple jurisdictions outside of their country. In addition, withholding
tax or other taxes may be imposed on earnings of the Fund from investments in such
jurisdictions. Local tax incurred in various jurisdictions by the Fund or entities through which
it invests may not be creditable to or deductible by the Unitholders.
In the case of the non-accession of one or more of the Target Markets in the EU, such a non-
accession might impact the tax efficiency of the Fund structure as contemplated.

Real Estate Considerations
Risk of Real Estate Investments Generally
Real estate values are affected by a number of factors, including changes in general economic
climate, local conditions, property management, competition on rental rates, attractiveness
and location of the properties, financial condition of tenants, buyers and sellers of properties,
quality of maintenance, insurance and management services and changes in operating costs.

Real Estate Returns
Real estate historically has experienced significant fluctuations and cycles in value and market
conditions may result in reductions in the value of investments. The returns available from
investments in real estate depend to a large extent on the amount of income earned and




                                              - 32 -
capital appreciation generated by the relevant properties as well as expenses incurred. If
properties do not generate revenues sufficient to meet operating expenses, including debt
service (if any) and capital expenditure, the Fund’s income will be adversely affected.
Income from properties may be adversely affected by factors beyond the control of the Fund
Manager including changes in the general economic climate, local conditions such as
oversupply of properties or a reduction in demand for properties in the markets in which the
Fund operates, the attractiveness of the Fund’s properties to tenants, the quality and
philosophy of management, competition from other available properties, and increased
operating costs (including real estate taxes). Other factors which may adversely affect the
Fund's income include: the promulgation and enforcement of governmental regulations
relating to land-use and zoning restrictions; environmental protection and occupational safety;
unavailability of mortgage funds that may render the sale of a property difficult; the financial
condition of buyers and sellers of properties; changes in real estate tax rates and other
operating expenses; the imposition of rent controls or tenants’ rights to new leases, energy
shortages, supply shortages, risk of adverse political or social developments, including
nationalization, expropriation of assets, confiscatory taxation, economic or political
instability, acts of terrorism and war; various uninsured or uninsurable risks and acts of God,
natural disasters and uninsurable losses. In addition, income from properties and real estate
values also are affected by such factors as the cost of regulatory compliance, interest rate
levels and the availability of financing. The Fund’s income would be adversely affected if a
significant number of tenants were unable to pay rent or its properties could not be rented on
favorable terms. Certain significant expenditures associated with each equity investment in
real estate (such as external financing costs, real estate taxes and maintenance costs)
generally are not reduced when circumstances cause a reduction in income from the property.

Additional Costs/Risks Associated with Investments in Real Estate
There is risk that the Fund could face substantial loss from environmental claims based on
environmental problems on properties held directly or indirectly by the Fund as well as from
occupational safety issues and concerns. Under the laws, ordinances and regulations of
various jurisdictions, an owner of real property may be liable for the costs of removal or
remediation of certain hazardous or toxic substances on or in such property. Such laws often
impose such liability (which is generally not limited) without regard to whether the owner
knew of, or was responsible for, the presence of such hazardous or toxic substances. The
presence of such substances, or the failure to properly remediate contamination from such
substances, may adversely affect the owner's ability to sell the real estate or to borrow using
such property as collateral.
The insolvency of any one or more of the Fund's properties could have a material and adverse
affect on the Fund and its operations and its ability to achieve its Investment Objectives.
Although some laws on the insolvency of enterprises have been enacted in the countries in
which the Fund intends to invest, there is no significant level of practical experience in the
manner in which these laws will be implemented or interpreted.

Real Estate Availability
The Fund’s investment strategy is based, in part, upon the premise that the Real Estate Assets
will be available for purchase by the Fund at prices and upon terms and conditions (including
financing) which the Fund Manager considers favorable to the Fund. No assurance is given
that the Real Estate Assets will be available for purchase by the Fund at prices and upon terms
and conditions which the Fund Manager considers favorable.

Development/Refurbishment of Properties
The Fund may undertake development (including redevelopment), under the Fund’s
investment restrictions, of real property or invest in real property that requires refurbishment



                                             - 33 -
prior to rental of the property. The risks of development or refurbishment include, but are
not limited to (i) delays in timely completion of the project; (ii) cost overruns; (iii) poor
quality workmanship; and (iv) inability to rent or inability to rent at a rental level sufficient to
generate profits.

Possible Lack of Diversification
While the Fund expects to invest in a diversified array of investments, the Fund may
participate in a limited number of investments and there can be no assurances concerning the
diversification of the Fund's assets either by geographic region or asset type. If the Fund
makes an investment in a single transaction with the intent of refinancing or selling a portion
of the investment, there is a risk that the Fund will be unable successfully to complete such a
financing or sale. This could lead to increased risk as a result of the Fund having an
unintended long-term investment and reduced diversification. A limited degree of
diversification increases risk because, as a consequence, the aggregate return of the Fund may
be substantially adversely affected by the unfavourable performance of a single investment.

Potential Conflicts of Interest
The Fund and its intermediary companies have or will have access to the managerial skills,
experience and relationships of the Fund Managerand the Property Manager. The Sponsor
believes that the Fund will benefit from this access. However, there are potential conflicts
inherent in the proposed structure of the Fund and its business.
ORCO is a public property company developing, acquiring, leasing, financing, re-financing,
managing and disposing of Real Estate Assets in the Target Markets. Certain of its employees,
officers and directors or any affiliates thereof may be subject to conflicts of interest on
certain acquisition opportunities. In cases where such acquisitions might fall within the Fund’s
Investment Guidelines, then the Fund shall have a right of first refusal on these acquisitions
and the Fund Manager shall act as an independent fiduciary in order to protect the interests of
the Unitholders.

ERISA Considerations
General
Section 406 of ERISA and Section 4975 of the Code prohibit a pension or other employee
benefit plan, as well as an individual retirement account or Keogh plan subject to Section 4975
of the Code (a “Plan”), from engaging in certain transactions involving “plan assets” with
persons who are “parties in interest” under ERISA or “disqualified persons” under the Code
(“Parties in Interest”) with respect to the Plan. A violation of these “prohibited transaction”
rules may result in an excise tax or other liabilities under ERISA or Section 4975 of the Code
for these persons, unless exemptive relief is available under an applicable statutory or
administrative exemption. Employee benefit plans that are governmental plans (as defined in
Section 3(32) of ERISA), certain church plans (as defined in Section 3(33) of ERISA) and foreign
plans (as described in Section 4(b)(4) of ERISA) are not subject to the requirements of ERISA or
Section 4975 of the Code.

Plan Assets Regulation
Under a regulation (the “Plan Assets Regulation”) issued by the United States Department of
Labor (the “DOL”), the assets of the Fund would be deemed to be “plan assets” of a Plan for
purposes of ERISA and Section 4975 of the Code if “plan assets” of the Plan were used to
acquire an equity interest in the Fund and no exception were applicable under the Plan Assets
Regulation. The assets of the Fund will not be deemed to be “plan assets” of investing Plans if




                                               - 34 -
(i) the Fund is considered to be an “operating company” under the Plan Assets Regulation, or
(ii) equity participation in the Fund by employee “Benefit Plan Investors” is not “significant”.

Significant Equity Participation
Equity participation in the Fund by employee Benefit Plan Investors is significant if,
immediately after the most recent acquisition of Units, 25% or more of each class of the Units
are held by Benefit Plan Investors. Benefit Plan Investors include Plans and employee benefit
plans not subject to ERISA or Section 4975 of the Code (such as governmental, church and non-
US plans), and entities holding assets deemed to be “plan assets” of any Plan (the “25 Percent
Threshold”). For these purposes any Units held by persons with discretionary authority over
the Fund’s assets or their affiliates (“Controlling Persons”) are disregarded.

Fiduciary Responsibilities
Persons acting as fiduciaries on behalf of a Plan are subject to specific standards of behaviour
in the discharge of their responsibilities. As a result, to the extent applicable, such persons
must, for example, conclude an investment in the Fund by a Plan would be prudent, would be
in the best interests of plan participants and their beneficiaries and in accordance with the
documents and instruments governing the Plan, and would satisfy the diversification and other
requirements of ERISA. In making those determinations, such persons should take into
account, among other factors, (i) that the Fund will invest in accordance with the Investment
Guidelines, objectives and strategies of the Fund without regard to the particular objective of
any class of Unitholders, including Plans, (ii) the fee structure of the Fund, (iii) the tax effects
of the investment, (iv) the relative illiquidity of the investment and its effect on the cash flow
needs of the Plan, (v) the Plan’s funding objectives, (vi) the risks of an investment in the
Fund, and (vii) “plan assets” issues, including those discussed below.
If the assets of the Fund were deemed to be “plan assets” under ERISA or Section 4975 of the
Code, the Management Company, the Sponsor and any other party with discretion as to the
assets of the Fund or provide investment advice for a fee could be characterised as a fiduciary
of investing Plans under ERISA and they and their affiliates and certain of the delegates could
be characterised as “parties in interest” and “disqualified persons” under ERISA and the Code
with respect to investing Plans. Further, among other adverse results, (a) the prudence and
other fiduciary responsibility standards of ERISA applicable to investments made by Plans and
their fiduciaries would extend to investments made with assets of the Fund; (b) a Plan’s
investment in the Units might expose the Plan fiduciary to co-fiduciary liability under ERISA
for any breach of ERISA fiduciary duties by the Sponsor, the Management Company, or other
parties, (c) assets of the Fund held outside the jurisdiction of the U.S. district courts might
not be held in compliance with applicable DOL regulations; and (d) certain transactions in
which the Fund might seek to engage could constitute prohibited transactions under ERISA
and/or the Code. A prohibited transaction involving a Plan, unless an exemption for the
prohibited transaction were available, generally could subject an interested party to an excise
tax and to certain remedial measures under ERISA; a prohibited transaction involving an
individual retirement account could result in its disqualification as well as an excise tax.
Regardless of whether the assets of the Fund are deemed to include “plan assets”, a possible
prohibited transaction might arise by virtue of the acquisition of Units by a Plan. Therefore,
each investor in the Fund will be required to represent and agree that (i) (A) it is not and will
not be (and is not deemed for purposes of ERISA or Section 4975 of the Code to be and will not
be deemed for such purposes to be) a Plan and (B) it is not and will not be (and is not deemed
to be and will not be deemed to be) another employee benefit plan subject to any federal,
state, local or foreign law that is substantially similar to Section 406 of ERISA or Section 4975
of the Code, or (ii) the purchase and holding of Units do not and will not constitute, result in




                                               - 35 -
or otherwise involve a non-exempt prohibited transaction under ERISA or Section 4975 of the
Code or, in the case of such another plan, a violation of any such substantially similar law.
In order to attempt to prevent the assets of the Fund from being deemed to include “plan
assets” for purposes of the Plan Assets Regulation, sales, redemptions, withdrawals, holdings
and transfers of Units (including any interest therein) will be limited so that the 25 percent
threshold described above is not exceeded with respect to any Class of Units. In connection
therewith, each investor in the Fund will be required to represent and agree that it is not and
will not be a Benefit Plan Investor or a Controlling Person, or will be required to represent to
the Fund prior to its acquisition of a Unit that it is a Benefit Plan Investor or a Controlling
Person. No acquisition, redemption, withdrawal or transfer will be permitted if thereafter the
25 percent threshold would be exceeded based upon the information received from
Unitholders. However, there can be no assurances that the 25 percent threshold described
above will be satisfied.
Employee benefit plans which are not subject to ERISA or Section 4975 of the Code, including
for example governmental and non-US plans, may be subject to laws regulating employee
benefit plans other than ERISA. Such plans should conclude that an investment in the Fund
would satisfy all such laws before making such an investment (and, as indicated above, may be
required to make certain assurances to the Fund).
Due to the complexity of these rules and the penalties that may be imposed upon persons
involved in non-exempt prohibited transactions, it is particularly important that fiduciaries or
other persons considering purchasing the Units on behalf of or with “plan assets” of any Plan
consult with their counsel regarding the potential consequences if the assets of the Fund were
deemed to be “plan assets” and the availability of exemptive relief under the prohibited
transaction class exemptions listed above.

Certain Additional United States Legal Matters
General
The Units will be offered on the terms and conditions set forth in the Subscription Agreement.
Persons receiving this Prospectus are responsible for informing themselves about and
complying with restrictions on the transfer of the Units sold in this private placement. US
Investors who purchase Units in a private placement and resell those Units other than in
accordance with the provisions of the Subscription Agreement may be deemed “underwriters”
as that term is defined in the Securities Act.

Securities Act
The offering of the Units in the United States has not been and will not be registered under
the Securities Act or under any of the securities laws of any State or other political subdivision
of the United States in reliance upon the offering and sale being exempt from registration as a
private placement. Accordingly, the Units will be offered as an investment for sophisticated
investors who have the ability to evaluate the merits and risks of an investment in the Units
and the ability to assume the economic risks involved in such an investment. Each purchaser
will be required in connection with any purchase of the Units to make representations
confirming its eligibility as a prospective and sophisticated investor and, with respect to offers
within the United States or to a U.S. Person, that it is an Accredited Investor, as defined under
the rules and regulations of the Securities Act, and a Qualified Purchaser, as defined under the
rules and regulations of the Investment Company Act, purchasing the Units for its own
account, for investment purposes only and not with a view to their distribution.




                                              - 36 -
Investment Company Act
The Fund will not be registered under the Investment Company Act and Unitholders will not be
entitled to the benefits of that Act. The Fund will seek to rely on the exemption from
registration under the Investment Company Act provided by Section 3(c)(7) of the Investment
Company Act which requires all purchasers of securities who are U.S. Persons or who are
within the United States to be Qualified Purchasers. Accordingly, if the Fund has beneficial
owners (within the meaning of the Investment Company Act) of its securities who are within
the United States or U.S. Persons but who are not Qualified Purchasers, the Fund may become
subject to the registration requirements of the Investment Company Act. The Management
Company will not knowingly permit U.S. Persons or persons who are within the United States
who are not Qualified Purchasers to own Units.

Transfer Restrictions
The Units will be subject to significant restrictions on transferability and resale and may not
be transferred or resold except as permitted by the Management Regulations (which require,
among other things, approval by the Management Company of any proposed transfer). The
Management Regulations will provide for the obligatory repurchase of Units in certain cases.
For example, in order to help ensure that the Fund remains exempt from the registration
requirements of the Investment Company Act and exempt from the fiduciary responsibility
provisions of the ERISA and the prohibited transaction rules of the Code and for other reasons,
the Management Regulations enable the Management Company, in its absolute discretion and
without assigning any reason therefore, to decline to register any transfer of Units (or any
interest therein) to any person (a “Non-Qualified Holder”) to whom a transfer would, if
registered, result in the Fund being required to register under the Investment Company Act or
which transfer may cause or create a risk that the assets of the Fund could be deemed to be
assets of an “employee benefit plan” within the meaning of Section 3(3) of ERISA or, of a
“plan” within the meaning of Section 4975 of the Code. Accordingly, the Management
Company may refuse to recognise such transfers, and may direct any Non-Qualified Holder to
transfer its Units or, failing such transfer, compulsorily repurchase such Units as provided in
the Management Regulations. Any purported transfer of the Units that (a) does not comply
with the transfer restrictions described herein and contained in the Management Regulations
or (b) would require the Fund to become registered as an “investment company” under the
Investment Company Act will be treated by the Fund as null and void ab initio.




                                             - 37 -
A. Management Resumes

  Jean-François Ott, ORCO, President and CEO
  Jean-François Ott has been President and CEO of ORCO since he founded the Company in 1991.
  Based in Paris, he is responsible for ORCO’s strategy, new business development and finance
  as well as banking and investor relations. Mr. Ott is also the President of MaMaison Residences
  and member of the board of the ORCO Hotel Group.
  Mr. Ott has over 12 years’ experience in real estate development and general business in
  Central Europe. Before setting up ORCO, at the age of 26, Mr. Ott spent 18 months in South
  Korea working with the French group, Framatome, and was a successful derivatives trader in
  Paris. In addition to his broad business experience, Mr Ott brings strong expertise in Central
  European real estate markets gained from living in Prague for 7 years and extensive travel in
  the region. Since ORCO’s beginnings in Prague, Mr. Ott has launched new subsidiaries in
  Budapest, Bucharest, Warsaw and Bratislava and new activities including residential buildings,
  extended stay hotels and luxury hotels. Over the last twelve years, ORCO, under Mr. Ott’s
  leadership, has completed the acquisition, development and financing of more than 40
  projects.
  Mr. Ott has been pivotal in the development of the ORCO brand in Central Europe and in the
  creation of a company with a recognised and experienced team. In December 2000, Mr. Ott
  successfully oversaw the listing of the Group on the Euronext Stock Exchange in Paris, and has
  been instrumental in attracting both French and international investors to ORCO.
  In January 2003, Mr.Ott secured investment capital from the EBRD for investment in ORCO’s
  Hotel Group. The capital will be used to develop the extended stay hotels segment in Central
  and Eastern Europe under the MaMaison Residence brand.
  Mr. Ott’s professional qualifications include degrees from the Institut d’Etudes Politiques and
  from the Owners Directors Program in INSEAD.

  Dr. Christoph Manthe, Executive Managing Director of the ENDURANCE Fund
  Christoph Manthe is the Based in Prague, with 21 years of experience in global real estate
  finance and investment with HypoVereinsbank (HVB), he joined ORCO and is now responsible
  for the Fund’s strategy, business development and banking and investor relationships. From
  2000 until 2003 he was a Director for HVB’s cross-border activities being responsible for
  relationships to its major real estate clients in Europe, particularly in Eastern Europe. From
  1998 until 2000, based in New York, he was the senior risk manager for the bank’s real estate
  portfolio in America.     Between 1995 and 1998 heading the real estate team for former
  Bayerische Vereinsbank in Prague the bank became the leading real estate lender in Czech
  Republic. During this time he built up extensive experience with Eastern European real estate
  markets and started long term relationships to the major developers and investors. Based in
  Munich from 1988 he was pivotally involved in the development of the international real
  estate business for Bayerische Vereinsbank in England, France and America. Later he moved to
  Berlin being a senior account manager for international real estate investors in Berlin. He
  started his career in 1982 working as a risk manager developing strong understanding for
  market and development risks.
  Mr. Manthe possesses extensive global real estate experience and is well connected in the
  industry. During his stay in Prague he developed a strong understanding of the Eastern
  European markets and built up an extensive network.
  Mr. Manthe received his doctorate’s degree in economics from Mannheim University, Germany.
  The last 18 months he spent in Tokyo participating in a Japanese language course and studying
  the Tokyo real estate market sponsored and organized by the European Commission



                                               - A1 -
(“Executive Training Programm”). He spent several months with Mitsui Fudosan, the leading
real estate company in Japan.

Luc Leroi, ORCO, Legal, Finance and Administration Director
Luc Leroi is ORCO’s Corporate Director and General Secretary. Mr. Leroi started his career in
1989 with Deloitte & Touche, as auditor for investment funds. From 1991 to 1996, he worked
at Banque UCL (Fortis Bank Luxembourg), specialising in the creation of investment funds. In
this role, Mr. Leroi was responsible for all legal aspects (prospectus, bye-laws, contracts) with
both promoters and Luxembourg regulatory authorities. During this time, he also gained
significant experience in tax matters for the Private Wealth Management division through
Luxembourg and foreign vehicles. In 1997 he joined Crédit Lyonnais Luxembourg S.A. and was
responsible for the Financial Engineering Department. He has also been Director of Crédit
Lyonnais Management Services. In 2002, he joined ORCO and opened the Luxembourg head
office of the Group. He currently manages both the Legal & Administrative and the Cash
Management departments of the Group. With his expertise of Luxembourg law issues, he is
also heavily involved in all corporate transactions of the ORCO Group. Luc Leroi graduated
from HEC in Belgium and holds a degree in Fiscal Sciences from the joint venture between
ESSF (ULB Brussels) and IFBL (Luxembourg).

Ales Vobruba, ORCO, Managing Director, Fund Manager designate of the ENDURANCE Fund
Ales Vobruba is a Managing Director with ORCO responsible for the operation of real estate
holding companies in the Czech Republic, Hungary and Poland. Prior to joining ORCO in 1995,
Mr. Vobruba worked in the export/import trade at Artia Foreign Trade Corporation from 1991
and prior to that was in charge of finance and tax for several private real estate and
advertising companies.
Since joining ORCO in Prague Mr. Vobruba’s responsibilities have included investment cash-
flow management, project finance, financial management and legal and tax administration.
He works on the acquisition and sales of the properties, supervises project developments in
office, residential, extended stay and hotels and the property management of office and
residential projects. In addition, he works with Mr. Ott on Group corporate finance and joint
ventures. During his time with ORCO, Mr. Vobruba has overseen 25 project developments
(with HVB, CS, a subsidiary of Erste Bank Group, Raiffeisenbank, Aareal Bank and Eurohypo), 3
portfolio refinancings and 19 project acquisitions.
Mr. Vobruba holds a Masters Degree in Foreign Trade from the Prague School of Economics.

Steven Davis, ORCO, Vice-president

Steven Davis oversees ORCO’s operations in the Czech Republic, Hungary and Poland. Based in
Prague, Mr. Davis is in charge of ORCO’s Sales and Development departments. Before he
joined ORCO in October 2003, Mr. Davis was a partner of a real estate and development
company FlowEast (1991 – 2003). Steven Davis has more than 20 years of work experience in
Central and Eastern Europe, including extensive experience in office and residential
development and redevelopment projects.

Dragan Lazukic, ORCO, Chief Financial Officer

Dragan Lazukic is ORCO’s Chief Financial Officer. Based in Prague, Mr. Lazukic has more than
15 years’ experience in marketing, accounting and finance. He has been working with ORCO
for 9 years and is currently in charge of the Financial Management department. He supervises
accountancy and financial management in all territories, and is responsible for tax issues,
ORCO Group’s consolidation, internal reporting and relations with investors. Mr. Lazukic also
takes part in ORCO’s development in ex-Yugoslav countries. Prior to joining ORCO, Mr.




                                              - A2 -
Lazukic launched an accounting and tax consulting company.     Mr. Lazukic holds a Masters
Degree from the Faculty of Economics at Sarajevo University.




                                          - A3 -
B. Definitions
  "1991 Law" means the Luxembourg law dated 19 July 1991, relating to undertakings for
  collective investment, the securities of which are not intended to be placed with the public;
  "2002 Law" means the Luxembourg law dated 20 December 2002, relating to undertakings for
  collective investment;
  "Advisory Board" means a committee consisting of representatives of certain Unitholders
  constituted in accordance with the Management Regulations;
  "Business Day" means a day on which banks are open for business in Luxembourg and London;
  "Call Notice" means a notice issued by the Management Company to the Class B Unitholders
  requiring them to contribute a portion of their Commitments against the issuance of Units and
  specifying (in summary form) the proposed application of such contributions;
  "Central Administration Agent" means Dexia Banque Internationale à Luxembourg, in its
  capacity as such, or such other Person as may subsequently be appointed as central
  administration agent of the Fund by the Management Company;
  "Class" means a class of Units issued by the Fund;
  "Class A Unit" means a Unit designated as a "Class A Unit" having the characteristics and the
  rights and obligations as set out in the Management Regulations;
  "Class A Unitholder" means a registered holder of a Class A Unit in such capacity;
  "Class B Unit" means a Unit designated as a "Class B Unit" having the characteristics and the
  rights and obligations as set out in the Management Regulations;
  "Class B Unitholder" means a registered holder of a Class B Unit in such capacity;
  " Sponsor" means ORCO Property Group S.A;
  "Commitment" means the maximum amount (denominated in Euro) contributed or agreed to
  be contributed to the Fund by way of subscription for Class B Units by each Class B Unitholder
  pursuant to such Unitholder’s Subscription Agreement (including any additional Commitment
  made by such Unitholder at subsequent closings);
  "Commitment Period" means the period of 36 months following the Initial Closing Date;
  "Committed Asset Unit" means a Unit held by a german Insurance Company in its cover fund
  (Sicherungsvermoegen) or as other committed asset (sonstiges gebundenes Vermögen) as
  defined in sections 54 para. 1 or 115 of the Insuarnce Act;
  "Committed Funds" means the aggregate amount of the Commitments for the time being;
  "Contributed Capital" means, in respect of a Unitholder, the aggregate amount of its
  Commitment that has been contributed to the Fund by such Unitholder (whether or not
  subsequently repaid) at the closing(s) when such Commitment was accepted and subsequently
  pursuant to Call Notices and excluding, for the avoidance of doubt, any interest payments;
  "Custodian" means Dexia Banque Internationale à Luxembourg, in its capacity as such, or such
  other credit institution within the meaning of Luxembourg law dated 5 April 1993 relating to
  the financial sector, as amended, that may subsequently be appointed as custodian in
  accordance with the Management Regulations;
  "CSSF" means the Commission de Surveillance du Secteur Financier, the Luxembourg
  supervisory authority for the financial sector, or any successor authority from time to time;
  "EBRD" means the European Bank for Reconstruction and Development;
  "EMU" means European Monetary Union;




                                               - B1 -
"ERISA" means the United States Employee Retirement Income Security Act of 1974, as
amended;
"ERM" means the exchange rate mechanism of the euro;
"EU" means the member states comprised in the European Union from time to time, being
currently Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France,
Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland,
Portugal, Slovakia, Slovenia, Spain, Sweden, The Netherlands and the United Kingdom;
"EU Institutional Investor" means a bank, insurance company or a pension fund having assets
under management in excess of EUR 500,00,000 that is resident in a member state of the
European Union;
"Euro" means the lawful currency of the EU that have adopted the single currency in
accordance with the Treaty establishing the European Community as amended by the Treaty
on European Union and as amended by the Treaty of Amsterdam;
"Final Closing Date" means 30 September 2005, i.e.the date of the last closing on which the
Management Company (in its discretion) accepts applications to subscribe for Units. In
accordance with the Management Regulations, the Management Company may postpone (in its
discretion) this date, which for the avoidance of doubt will be no later than 12 months from
the Initial Closing Date;
"Fiscal Year" means the 12 months ending on 30 September of each calendar year during the
term of the Fund, provided that the first Fiscal Year of the Fund shall begin on the creation of
the Fund and end on 30 September 2006 and the final Fiscal Year of the Fund shall end on the
date of the final liquidation distribution of the Fund;
"Fund" and "ENDURANCE Fund" mean The Endurance Real Estate Fund For Central Europe, an
FCP established in Luxembourg by the Sponsor in order to make investments in commercial
property in the Target Markets as more particularly described in this Prospectus.
"Fund Documents" means this Prospectus and the Management Regulations and the Fund
Management Agreement;
"Fund Management Agreement" means the fund management agreement in respect of the
Fund between the Management Company and the Fund Manager.
"Fund Manager" means ORCO, in its capacity as such, or such other person as may
subsequently be appointed as fund manager of the Fund in accordance with the Management
Regulations;
"German Insurance Company" means a german insurance company or German pension fund
subject to the Insuarnce Act;
"Independent Appraiser" means an independent valuation expert appointed from time to time
by the Management Company with the prior approval of the CSSF for the purposes of valuing
Real Estate Assets;
"Initial Closing Date" means 1 June 2005, i.e.the earliest date on which the Management
Company (in its discretion) accepts applications to subscribe for Units, in accordance with the
Management Regulations;
"Initial Subscription Price" means, in respect of a Unit, the initial subscription price being in
repect to Class A Units Euro 1.25 and in respect to Class B Units Euro 10;
"Internal Rate of Return" means a (positive) annual discount rate which, when applied to the
Contributed Capital and distribution cashflows between the Class B Unitholders and the Fund
and discounted annually, produces a net present value of those cashflows equal to zero, as
calculated in accordance with the Management Regulations;




                                              - B2 -
"Investment Guidelines" means the investment guidelines of the Fund, as set out in the
Management Regulations;
"Investment Objectives" means the investment objectives of the Fund, as set out in the
Management Regulations;
"Investment-Related Expenses" means costs and expenses incurred in relation to proposed
and actual investments of the Fund and in relation to proposed and actual disposals of
investments of the Fund, including the fees and expenses of third party consultants and
advisers engaged in connection therewith;
"Investment Restrictions" means the investment restrictions of the Fund, as set out in the
Management Regulations;
"Management Company" means Endurance Real Estate Management Company S.A.;
"Management Company Board" means the duly constituted board of directors of the
Management Company;
"Management Regulations" means the management regulations entered into between the
Management Company and the Custodian on 14 March 2005;
"Mémorial" means the Mémorial, Recueil des Sociétés et Associations, the official gazette of
the Grand Duchy of Luxembourg;
"NAV per Unit" means the net asset value per Unit in respect of each Class, as determined in
accordance with the Management Regulations;
"Offer Period" means the period starting on 1 June 2005 and ending on the Final Closing Date;
"Operation and Administration Expenses" means:
   a) all costs and expenses incurred in relation to the production and distribution of the
      reports and accounts in respect of the Fund and the valuations and certifications
      required pursuant to the Management Regulations including the fees of the auditors in
      connection therewith;
   b) all fees and expenses charged by lawyers, accountants and other professional advisers
      appointed by the Management Company; and
   c) all other fees, costs and expenses (including the reasonable expenses of the Advisory
      Board) in relation to the operation and administration of the Fund generally (other
      than Investment-Related Expenses and costs incurred as a result of an indemnification
      in accordance with the Management Regulations), including in respect of the provision
      of insurance required by the Management Regulations;
"ORCO" means ORCO Property Group S.A.;
"Organisational Expenses" means out-of-pocket costs and expenses incurred by the Sponsor
for the purpose of establishing the Management Company and by the Sponsor and the
Management Company for the purposes of structuring, establishing and closing the Fund;
"Paying Agent" means Dexia Banque Internationale à Luxembourg, in its capacity as such, or
such other Person as may subsequently be appointed as paying agent of the Fund by the
Management Company;
"Person" means a corporation, limited liability company, trust, partnership, estate,
unincorporated association or other legal entity falling within the concept of an institutional
investor within the meaning of the 1991 Law;
"Placement Agent" means JP Morgan Plc;
"Placement Fees" means all placement fees and expenses payable to the Placement Agent or,
as the case may be, the Sponsor or its Affiliate as further described herein;



                                             - B3 -
"Property Manager" means in respect to a Real Estate Asset such Person as is appointed as
property manager of such asset in accordance with the Management Regulations;
"Qualified Majority of Unitholders" means the qualified majority of Unitholder, as applicable,
as defined in the Management Regulations;
"Real Estate Assets" means:
    a) property consisting of land and buildings registered in the name of the Fund or a
       Subsidiary;
    b) shareholdings in real estate companies (including claims on such companies), the
       exclusive object and purpose of which is the acquisition, promotion and sale of real
       property, and the letting thereof, provided that such shareholdings must be at least as
       liquid as the property rights held directly by the Fund; and
    c) property-related long-term interests held by the Fund such as surface ownership,
       lease-hold and options on real estate investments;
"Registrar and Transfer Agent" means First European Transfer Agent S.A., in its capacity as
such, or such other Person as may be appointed as registrar and transfer agent in respect of
the Fund by the Management Company;
"Regulated Market" means a regulated securities market which operates regularly and is
recognized and open to the public;
"SOPARFI" means a Luxembourg sociétés de participations financieres;
"Subscription Agreement" means the agreement between the Management Company and each
Unitholder setting forth:
    a) the Commitment of such Unitholder;
    b) the rights and obligations of such Unitholder in relation to its subscription for Units;
       and
    c) representations and warranties given by such Unitholder in favour of the Fund;
"Subscription Price" means the price at which a Unit is issued after the initial subscription;
"Subsidiary" means any company or entity (other than a Wholly Owned Subsidiary) in which
the Fund has more than a fifty percent (50%) ownership interest;
"Target Markets" means the Czech Republic, Poland, Latvia, Estonia, Lithuania, Hungary,
Slovakia, Croatia, Romania, Bulgaria;
"Transactional Value" means the acquisition cost (including any portion financed by
borrowings at Fund or Subsidiary level) or disposal proceeds (before repayment of any
borrowings used to finance the acquisition of the relevant asset), as applicable of a Real
Estate Asset acquired or disposed of by the Fund, excluding (i) interest on any such debt
financing (ii) related real estate transfer taxes and (iii) costs and expenses associated with
such acquisition or disposal;
"Uncalled Commitment" means, in respect of a Unitholder, its Commitment less its
Contributed Capital for the time being;
"Unit" means a co-ownership participation in the Fund issued by the Management Company
pursuant to these Management Regulations;
"Unitholder" means the registered holder of a Unit;
“U.S. Person” has the meaning prescribed in Regulation S under the Securities Act.




                                              - B4 -
"Valuation Date" means the last Business Day of each Fiscal Year and any other day as the
Management Company Board may in its absolute discretion determine for the purposes of
calculation of the NAV per Unit;
"Valuation Policies" means the valuation policies for determining the market value of Real
Estate Assets, as determined by the Independent Appraisers in accordance with the prevailing
applicable Practice Statements contained in the RICS Appraisal and Valuation Manual
published by The Royal Institution of Chartered Surveyors;
"VAT" means Value Added Tax; and
"Wholly Owned Subsidiary" means any company or entity in which the Fund has a one hundred
percent (100%) ownership interest, except that where applicable law or regulations do not
permit the Fund to hold such a 100% interest, "Wholly Owned Subsidiary" shall mean any
company or entity in which the Fund holds the highest participation permitted under such
applicable law or regulations.




                                           - B5 -
C. Management Regulations
  1




                            - C1 -
- C2 -

				
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