BR Properties S A : Dados Econômico-Financeiros

Financial Statements

BR Properties S.A.

December 31, 2022 and 2021 with Independent Auditor's Report

MANAGEMENT REPORT

Dear Shareholders,

In compliance with the legal and statutory provisions in force, the Management of BR Properties S.A. ('Company' or "BR Properties") presents its comments and results for the year ended December 31, 2022. The amounts are expressed in thousands of reais, except when otherwise indicated, and in accordance with the provisions of the Brazilian Corporate Law and standards established by the Brazilian Securities and Exchange Commission (CVM). The message from management is an integral part of the individual and consolidated financial statements and should be read in conjunction with the respective Explanatory Notes.

BUSINESS DESCRIPTION

BR Properties is one of the leading commercial real estate investment companies in Brazil, focused on the acquisition, lease, management, development and sale of commercial real estate, including office buildings and industrial and logistics warehouses, located in the main metropolitan regions of Brazil. BR Properties adopts a dynamic posture of monitoring the Brazilian commercial real estate market, in order to anticipate supply and demand trends in the various regions where it operates, in order to evaluate the best acquisition or sale opportunities, and to maximize the profitability of its investments.

At the end of the year, the Company had 12 commercial properties in its portfolio, totaling a gross leasable area (GLA) of 416 thousand square meters, representing a market value of approximately R$2,201,970. The Company has also 3 landbanks corresponding to 65 thousand sqm of potential GLA.

The 12 properties held in the portfolio by the Company at the end of 2022 are distributed as follows:

• 4 or 92 thousand sqm are office buildings;
• 5 or 260 thousand sqm are industrial and logistics warehouses;
• 3 or 65 thousand sqm are landbanks.

MESSAGE FROM MANAGEMENT

2022 was marked by rising global inflation, with many countries recording the highest inflation rates in decades, and consequently their respective Reserve/Central Banks raising interest rates considerably, bringing recession risk to 2023. In Brazil it was no different. We also face discussions regarding fiscal policies, especially considering the government's increased public spending, corroborating the uncertainty concerning the Brazilian political and economic reality.. The Brazilian Central Bank does not rule out resumption of interest rate increases, especially if the increase in public spending pressures inflation.

Given all these factors mentioned above, the Company, despite maintaining its long-term strategy focused on concentrating AAA assets in the main regions of São Paulo and Rio de Janeiro, does not forsees new investments in the short term that can generate attractive returns, considering alternatives to allow shareholders to better monetize their invested capital. At the same time, the high recycling capacity of BR Properties' portfolio is highlighted in an assertive and efficient manner, as in the Portfolio Sale to Brookfield, completed in July 2022, aiming at reducing leverage and better monetizing the shareholders' capital, through the payment of proceeds via capital reduction, at a time when the market

had been pricing its shares (BRPR3) over the last two years, at a discount of around 35-40% over the Net Asset Value (value of your portfolio deducted from your net debt).

In this context, at the beginning of 2023, the Company proposed a reduction of the Company's corporate capital to its shareholders, for considering it excessive, so that they can better monetize their invested capital. The 2023 Capital Reduction in the total amount of BRL2,510.8 million will result in a refund to shareholders of:

1. a total amount in cash of BRL1,276.0 million, approximately BRL2.75 per share; and
2. an amount in kind to be paid through the delivery of quotas of real estate investment fund BRPR Corporate Offices Fundo de Investimento Imobiliário in the total amount of BRL1,234.8 million, approximately BRL2.66 per share.

Regarding the in-kind portion of the 2023 Capital Reduction, the Company structured the BRPR Corporate Offices Fundo de Investimento Imobiliário with the purpose of transferring the properties in its remaining office towers portfolio (Passeio Corporate and Águas Claras) to such fund and delivering the respective FII quotas to the Company's shareholders. The FII quotas will be listed for trading on the secondary market on B3 and once admitted to trading, will be traded under the ticker BROF11.

The capital reduction was approved on January 24th, 2023, and will become effective 60 days after the publication of the minutes of the EGM, pursuant to the article 174 of Law 6,404, when the Company will disclose to its shareholders the procedures, the final amount per share to be refunded, the date of payment and the initial date of negotiation of the Company's shares ex-reduction.

On January 13th, 2023, the Company received a notice sent by GPIC, LLC ("Offeror"), and THB JV S.À R.L informing that a binding Voting and Other Covenants Agreement has been executed, through which the Offeror undertook to launch a voluntary tender offer for the purchase of the Company's shares ("Offer") and THB JV S.À R.L undertook to cause GP Capital Partners VI, L.P., the Company's Controlling Shareholder, to sell the common shares issued by the Company in the context of the Offer. On the same date, the Company also received a notice from the Company's Controlling Shareholder requesting the Company to call and to hold a shareholders' extraordinary general meeting for the resolution of the following matters: (i) the removal of the poison pill set forth in article 23 of the Company's bylaws; and (ii) the Company's voluntary exit from the special listing segment of B3 S.A. - Brasil, Bolsa, Balcão called Novo Mercado, with the waiver of a tender offer for the purchase of shares, pursuant to article 44 of the Novo Mercado Regulation and with its effects conditioned upon the success of the Offer. On January 19th, 2023, an extraordinary general meeting was called to be held on February 9, 2023, at the Company's headquarters, in order to deliberate on the items above.

4Q22 & 2022 OPERATIONAL HIGHLIGHTS

Leasing Activities

Throughout 4Q22, BR Properties signed 25,489 sqm of GLA under new leases, totaling 37,281 sqm in the year.

It is worth mentioning that, of the total volume leased in the quarter, 23,392 sqm correspond to leases in Galpão Cajamar, and 2,097 sqm leases in Passeio Corporate.

BR Properties closed the year with financial and physical vacancy rates of 3.9% and 3.8%, respectively. If we consider the recent delivery of Galpão Cajamar, still under leasing process, the rates of financial and physical vacancy are 16.6% and 31.0%, respectively.

Asset Sales

In May 2022, the Company entered into a Purchase and Sale Agreement ("CCV") with the purpose of selling 12 commercial properties, totaling R$5,923,493. At the conclusion of the transaction, in July of the same year, the Company received 70% of the total price of the properties (R$4,146,998), and the second installment, corresponding to 30% of the total price (R$ 1,776,494), will be paid within 12 months of the respective payment dates of the initial installments, duly corrected according to the Agreement.

The funds received so far from the Portfolio Sale were used for (i) the amortization of 100% of its debt issues, completed throughout 3Q22; and for (ii) the reduction of the Company's corporate capital in the gross amount of R$1,125,000, through the refund to shareholders of approximately R$2.422311 per share. The Company's shares began trading ex-capital reduction on October 3 and the payment was made on October 14, 2022.

Capital Markets

Throughout the year, the Company paid to shareholders, via distribution of dividends, the total amount of R$48,968, corresponding to approximately R$0.11 per share.

Additionally, as already mentioned, the Company distributed to shareholders on October 14, via capital reduction, the amount of R$1,125,000, equivalent to approximately R$2.422311 per share.

Liability Management

As mentioned, throughout 3Q22, BR Properties amortized 100% of its debt issues, in the amount of R$2,987,533 million, referring to the entire outstanding balance plus pre-payment premium, if applicable.

In December, the Company has deposited in court the total amount of BRL98,7 million related to the lawsuit filed by Bicicletas Monark S/A concerning the collection of a contractual fine for withdrawal of the deal by Wtorre Empreendimentos Imobiliários S.A., established in the preliminary purchase and sale agreement of a property, entered into between Monark and Wtorre Empreendimentos in 2008. The Merger Agreement signed between the Company, Wtorre S.A., One Properties and Banco BTG Pactual S.A. establishes that the responsibility for the Monark Lawsuit lies with Wtorre, including its conduction, monitoring and any losses that the Company would suffer from the Monark Lawsuit. Up to date, Wtorre Empreendimentos S.A. had not reimbursed the Company, as provided for in the Merger Agreement.

The Company will keep its shareholders and the market in general informed about the evolution of the negotiations with Wtorre about the progress of the lawsuit and the reimbursement of the amount deposited in court, or the means necessary to achieve this end, according to the measures provided for in the Merger Agreement.

ESG

Since the beginning of the Company, sustainability has played a key role in BR Properties' strategic planning. During the past 15 years, the Company has always sought to achieve best practices in the environmental, social and governance stances, and, more recently, the Company has been actively working on the communication, dissemination, and improvement of its ESG strategy and goals. To structure and consolidate all ESG policies, the Company has established a partnership with blendON, a specialist in sustainability communication, disclosed its first Annual Sustainability Report on August 30, 2022.

PROFIT OR LOSS

In terms of results, consolidated gross revenue totaled R$40,305 in 4Q22.

The Company's gross revenue for the fourth quarter of 2022 was divided between lease income and property management revenues, in the following proportion:

• Lease income: totaling R$36,119, representing 90% of consolidated gross revenue;
• Property Management Revenues: totaling R$4,186, representing 10% of consolidated gross revenue.

Net revenue for the quarter totaled R$31,559.

Adjusted EBITDA, excluding non-cash results such as the stock options plan, reached R$5,241 in 4Q22, with an adjusted EBITDA margin of 17%.