Offer Of Mandatory Convertible Notes

NZX RELEASE 10 November 2009

Offer Of Mandatory Convertible Notes

Kiwi Income Property Trust today announced it is seeking to raise up to $125 million through a primary offer and an entitlement offer of unsecured subordinated Mandatory Convertible Notes (“MCNs”). The primary offer of $100 million is available to New Zealand residents and Australian institutions, and the entitlement offer of $25 million is to unit holders in the Trust with a registered address in New Zealand as at 17 November 2009.

The MCNs will pay a fixed interest rate for five years of 8.95% per annum, paid quarterly, and will benefit from any appreciation in the price of the Trust’s units above $1.20 at the conversion announcement date. Otherwise the terms are similar to the Trust’s existing issue of MCNs, including having a term to maturity of 5 years and ranking as unsecured, subordinated obligations of the Trust until conversion. The entitlement offer involves the offer of 1 right to acquire a MCN for every 35 units held on 17 November 2009.

The Offers serve a number of purposes including extending the duration of the Trust’s funding base, diversifying the sources of funding and providing flexibility for the Trust to consider value added investment opportunities.

The Offers of MCNs will provide investors with the opportunity to make an investment with the Trust through a security that provides quarterly payments at a fixed interest rate for 5 years, a conversion mechanism that ensures MCN investors will get units to a minimum value of $1.02 for every $1.00 initially invested (calculated by reference to the average of the daily volume weighted average unit price over the 20 business days prior to the conversion announcement date) and also an opportunity to benefit in the appreciation of the unit price above $1.20.

Interested investors should contact the Arranger and Joint Lead Manager Goldman Sachs JBWere (NZ) Limited or one of the Joint Lead Managers Craigs Investment Partners Limited or Forsyth Barr Limited to obtain a copy of the prospectus, or contact their financial or legal advisor. The prospectus has been registered with the Companies Office and has been provided to the NZX with this announcement. A copy of the prospectus has also been posted on the Trust’s website www.kipt.co.nz. The prospectus, together with the interim report for the six months to 30 September 2009, is expected to be mailed to existing mandatory convertible note holders and unit holders on 19 November 2009.

The closing date for the primary offer is 11 December 2009 and the application date and last date of receipt of renunciations under the entitlement offer is 9 December 2009. The rights and the MCNs have been approved for listing by NZX and will be quoted upon completion of allotment procedures. However, NZX accepts no responsibility for any statement in this announcement. NZX has authorised Primary Market Participants to act on the Offers. NZX is a registered exchange, regulated under the Securities Markets Act 1988.

ENDS

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