Workspace Group PLC

Interim Results

For the six months to 30 September 2004

Headline results

• Trading PBT £6.92m Up 4.7%

• Trading EPS 29.6p Up 2.8%

• Headline PBT £6.54m Down 1.5%

• Headline EPS 27.6p Down 4.5%

• Valuation surplus in half year £27.0m £1.60 per share

• Net Asset Value (per share) £19.87 Up 23% on 12 months

• Annual Rent Roll £40.3m Up 5.9% on 6 months

• Total Property Valuation £655m Up 16% on 12 months

• Gearing 94%

• Interim Dividend 11.3p Up 10%

The Business – A Simple Model

To achieve profit and capital growth from:

• Providing workspace to SMEs

• Investing in properties with potential- Income growth- Capital growth- Alternative use

• Increasing scale of portfolio, spreading overheads and developing the brand

• The right financial platform

Our Business – A Reminder

“ We provide affordable, flexible space for new and small businesses in London and the South East ”

• 3,900 customers over 100 estates; 5.0 million sq .ft

• 6,000 + enquiries a year; market leading brand in fragmented market

• A simple product offer

• Superior service from in-house management

• Customer focused

Customer Profile

Median % of median

turnover Year of start 1996 —

Turnover £250,000 —

Overheads £90,000 36

Profits £40,000 16

Rent £12,000 4.8

Typical Workspace tenant:

Rent under 5% of turnover

Source: Kingston University survey of over 200 customers. Spring 2004

Occupancy and Rents

• Continuing occupancy improvements –

88.5% overall

• Rents stable with low base

• Cautious approach to rent reviews

• Lettings underway at Barley Mow, Quality

Court, Europa, Leathermarket

Acquisitions & Disposals

Acquisitions

Quadrangle, SW6

Southbank House, SE1

Southgate Office Village, N14

Total £28.3m

Net Yield 6.9%

Disposals

Hooley Lane, Redhill

Union Street Sites, SE1

Three Mills, E3

£34.5m

2.6%

New Acquisitions

The Quadrangle, SW6 Southbank House, SE1 Southgate Office Village, N14

Adding Value: Schemes in 2004/05

Enterprise

Clerkenwell

Thurston Road

Wharf Road

Aberdeen Studios

Greenheath Business Centre

Further reorganisation of space and extra floors

Phase Two completes September 2005

Full Refurbishment Underway: To complete late 2005

Mixed use (housing/retail warehousing)

Discussions with Council proceeding. Further planning application in Spring

Mixed use (housing/workspace) Planning appeal lodged; Council to consider new application by March 2005

Mixed use (housing/workspace)Council to consider Planning Application in December 2004

Mixed use (housing/workspace) Council to consider Planning Application in February 2005

2004 H1 Results: P & L Account

Trading

2003

£m

Increase

%

Trading

Operations

£m

Other

£m

Total

2004

£m

Turnover 24.0 12.1% 26.9 26.9

Rent Payable and direct costs (6.7) 6.7% (7.1) (7.1)

Administrative Expenses (3.4) 15.3% (3.9) _____ (3.9)

Operating Profit 13.9 13.8% 15.9 15.9

Surplus on disposal of investment properties - - - (0.4) (0.4)

Net interest payable (7.3) 22.0% (9.0) _____ (9.0)

Profit before tax 6.6 4.8% 6.9 (0.4) 6.5

Tax (2.0) 6.8% (2.1) - (2.1)

Profit after Tax 4.6 3.9% 4.8 (0.4) 4.4

Basic earnings per share 28.8p 29.6p (2.0)p 27.6p

Diluted earnings per share 28.2p 28.9p (1.9)p 27.0p

2004 H1 Results: Balance Sheet

30/09/2004

£m

31/03/2004(restated)

£m

Investment Properties 652.4 626.1

Other Assets 11.4 10.4

Creditors (excluding borrowings) (33.6) (29.6)

Funding: Short Term Borrowings - (1.3)

Long Term Borrowings (306.2) (305.7)

Cash and Investments 4.0 1.3

Deferred Tax Provision (5.8) (5.5)

Net Worth 322.2 295.7

NAV Per Share £19.87 £18.43

Net Borrowings £302.2m £305.8m

Gearing 94% 103%Immediate Investment Capacity = £68.3m (Gearing 115%)

Key Elements on Valuation

• Income up 3.9%, ERV up 2.1% (like-for-like)

• ERV £54.8m; 90% ERV = £49.3m current rent roll £40.3m

• Net initial yield 6.27%, reversionary yield 8.36%, equivalent yield 7.37%

• Valuation surplus: 50% rent, 50% yield

• Capital value £126 per sq. ft

Looking Forward: The Same Business Model

• As stated September 2003 - 5% per annum rental increases

- No movement in yields/occupancy

- Conservative gearing- Annual investment £50m - £60m

• Aim: - Doubling value in 5 years to 2008 - £1bn portfolio

• On track

Looking Forward: Occupancy and Rents

• SME confidence improving

• SME numbers growing

• London economy robust

See: Investor Relations/Company Presentationssection of www.workspacegroup.co.uk

Looking Forward

• Disposals

• Acquisitions

• Added Value Schemes

Summary

• Good enquiry levels; occupancy high and robust

• Rental focus in 2005/06

• Added value programme gaining momentum

• Business plan on target

• Growth opportunities

Workspace – Leader in a Growing Marketplace