Deutsche EuroShop | Annual Report 2013

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A N N U A L R E P O R T
13
SHOPPING EXPERIENCE
OF THE FUTURE
Life doesn’t just happen online

Deutsche EuroShop
Overview
2013 2012 DIFFERENCE
Revenue 188.0 178.2 6%
EBIT 165.8 151.6 9%
Net finance costs -34.1 -62.1 45%
Measurement gains/losses 56.0 13.9 302%
EBT 187.6 103.4 81%
Consolidated profit 171.0 122.5 40%
FFO per share(€) 2.08 1.68 24%
Earnings per share (€)1
3.17 2.36 34%
Equity2
1,642.4 1,606.1 2%
Liabilities 1,752.5 1,741.5 1%
Total assets 3,394.9 3,347.6 1%
Equity ratio (%)2
48.4 48.0
LTV-ratio (%) 43 41
Gearing (%)2
107 108
Cash and cash equivalents 40.8 161.0 -75%
Net asset value (EPRA) 1,650.4 1,538.9 7%
Net asset value per share (€, EPRA) 30.59 28.53 7%
Dividend per share (€) 1.253
1.20 4%
1
undiluted
2
incl. non controlling interests
3
proposal
KEY DATA IN € MILLION
REVENUE IN € MILLIONS EBIT IN € MILLIONS EBT IN € MILLIONS
excluding valuation
FFO IN €
per share
2013 2014 2015
Target
186–189
Result
188.0
Target
198–201
Target
202–205
2013 2013 20132014 2014 20142015 2015 2015
Target
162–165
Result
165.8
Target
113–116
Result
113.4*
* Adjusted for sale proceeds
Target
1.99–2.03
Result
2.08
Target
174–177 Target
120–123
Target
2.14–2.18
Target
177–180
Target
125–128
Target
2.20–2.24
DEUTSCHEEUROSHOPANNUALREPORT2013
002

Dear Readers,
Many of us will have done it at some point: browsed,
clicked and purchased online. A few days – if not a few hours –
later, the doorbell rings, and it’s the friendly courier. We open
the parcel, and there it is: the item we ordered. It is just as we
imagined it. And it was a real bargain, too.
There’s no doubt that e-commerce has benefits for all of
us – provided everything works out as in this ideal scenario. Of
course, in reality, I may well end up sending back items that I
have ordered, because I don’t like them or they are unsuitable.
Or it may turn out to be too much effort for the delivery com-
pany to send the goods up to the third floor, so I have to collect
my package from a branch instead. And because I’m not the only
one picking up or returning a package, there is quite a long
queue. It can be a real hassle.
Yet the inexorable rise of online shopping continues. But
does this trend mean that physical retailers will disappear
within a few years, so that the space currently used for our
shopping centers will no longer be needed?
In recent times, we have had many discussions with
investors about questions like these regarding the potential
impact of the e-commerce boom. And we are sure that you, too,
would like to know how secure our business model is. In this
annual report, we would like to give you a closer insight into the
current developments.
And right from the outset, I can tell you that, yes, things
are happening in retail! But it was ever thus. The old German
saying, “Handel ist Wandel” – “trade is change” – is more rele-
vant today than ever. We are confident that we are well-posi-
tioned with our portfolio, currently made up of 19 shopping
centers. And we see not only risks, but also opportunities.
Customers and visitors should be offered the best of both
worlds. An increasing number of retailers are pushing ahead
with a blend of online and traditional, physical retailing, known
as multi-channel marketing. So for instance, you pick out the
item of clothing you want in the store, try it on in your size and
then have it sent in the colour of your choice either to your home
or to the store, where you can pick it up at your leisure and look
it over again. Alternatively, you place your order online and have
the item sent to a store near you, where you can see it and try it
on. If you don’t like it, you don’t have to wait in a queue to return
it: just leave it in the shop and perhaps look at something else.
There is no doubt in my mind that the online world will
never replace a good old shopping spree with family and
friends, or the pleasure of finding something completely by
chance.
In addition to this and other topics, you will as usual find
detailed information on the past financial year in this annual
report. And of course we also take a look ahead and give you
our forecasts for our business up until 2015.
If you have any questions, praise or criticism regarding
this report, your comments are always very welcome.
For the time being, however, I hope that you find it both
an enjoyable and interesting read!
Best regards
Claus-Matthias Böge
CEO
Claus-Matthias Böge,
CEO
003

004
l
Deutsche EuroShop
2013
Shopping experience of the future –
Life doesn’t just happen online

005
2
20
52
98
117
137
192
Key data 2
Editorial 3
Our values, our goals 6
Highlights 2013 7
Interview with the Executive Board 8
Report of the Supervisory Board 14
96 The Shopping Center Share
104 Breakdown of Deutsche EuroShop shares
106 Annual General Meeting
107 Real Estate Summer
108 Marketing
110 Conferences and roadshows in 2013
111 10 reasons to invest in Deutsche EuroShop share
112 Corporate Governance
192 Glossary
194 Financial calendar
195 Index
196 Imprint
197 Multi-year overview/Key data
Introduction
Shopping
The Centers
Investor Relations
Group Management Report
Consolidated Financial
Statements
Service
Dark side of the
new shopping paradises 20
The digital shopping center 28
What I bought in 2013 32
Stores are surviving 36
Books on the subject of shopping 41
Charts 2013 43
Retail without boundaries and
shopping centers 44
Consumer spending in 2014 49
Deutsche EuroShop‘s portfolio 52
Activities in the centers 2013 60
Environment 63
The future at Douglas: omni channel 64
La Maison du Pain 66
The Main-Taunus-Zentrum turns 50 68
The Stadt-Galerie Passau turns 5 73
The centers 74

Our values
We are the only public company in Germany
that invests solely in shopping centers in
prime locations. We invest only in carefully
chosen properties. High quality standards and
a high degree of flexibility are just as impor-
tant to us as sustained earnings growth from
index- and turnover-linked rental contracts. In
addition, we boast a higher than average occu-
pancy rate of around 99% and professional
center management – these are the pillars of
our success.
Our goals
Deutsche EuroShop does not seek short-term
success, but rather the stable increase in the
value of our portfolio. Our objective is to gen-
erate a sustainably high surplus liquidity from
the longterm leasing of our shopping centers
to distribute an attractive dividend to our
shareholders every year. In order to achieve
this, we shall acquire further prime properties
and hence establish ourselves as one of the
largest companies in Europe focusing on retail
properties.
Our values
our goals
006

Increase of the shareholding in
Altmarkt-Galerie, Dresden to 100%
Annual General Meeting
Distribution of a dividend of €1.20
per share
Disposal of Galeria Dominikanska
Wroclaw, Poland
5th anniversary of Stadt-Galerie
Passau
Determination of the dividend policy
up to 2016
MAY
AUGUST
NOVEMBER
JUNE
SEPTEMBER
Highlights
2013
007

Interview with
the Executive
Board
“We have
ideas that we
would like to put
into practice.”
008
CLAUS-MATTHIAS BÖGE
OLAF BORKERS
CEO
MEMBER OF THE EXECUTIVE BOARD

THE RESTRUCTURING OF THE
GROUP WAS A MAJOR FOCUS IN
FINANCIAL YEAR 2012. WERE
YOU ABLE TO FOCUS MORE ON
DEUTSCHE EUROSHOP’S ACTUAL
BUSINESS AGAIN IN 2013?
CLAUS-MATTHIAS BÖGE: Yes, we were.
The optimisation of the Group structure has
been largely completed. I certainly do find
shopping centers more interesting than
taxes – and a lot more fun.
OLAF BORKERS: But we will always keep
the tax issue in the back of our minds in
everything we do.
CLAUS-MATTHIAS BÖGE: In fact, I need to
qualify my first statement, because another
issue caused us some concern in the second
half of the year, and only a short time ago:
the new Kapitalanlagegesetzbuch (KAGB –
German Capital Investment Code), which
entered into force on 22 July 2013.
?
The KAGB constitutes extensive regulation
of investment managers and their invest-
ment funds, and it affects self-managed
investment funds as well as external man-
agers of investment funds. In principle, the
regulations can also impact structures like
Deutsche EuroShop: companies that acquire
and hold real estate.
However, our structure as a holding compa-
ny, our activities and the strategy we have
pursued to date mean that the KAGB should
not apply to Deutsche EuroShop, which was
confirmed in writing by the Federal Finan-
cial Supervisory Authority at the end of
March this year.
LET’S TURN TO ISSUES THAT
WE ALL ENJOY TALKING ABOUT:
SHOPPING CENTERS AND
LEASING. HOW HAS OPERATING
BUSINESS PERFORMED?
OLAF BORKERS: Like clockwork. We are
very pleased. To be more specific, we budg-
eted sales of €186 million to €189 million
and we hit €188.0 million exactly, which
represented an increase of over 5%. We an-
ticipated earnings before interest and taxes
(EBIT) of between €162 million and
€165 million; at €165.8 million, they were
actually slightly above the forecast range
and rose by over 9% year on year.
We allowed for earnings before taxes
(EBT) without measurement gains/losses
of between €113 million and €116 million.
At €129.2 million, they were also significant-
ly above the forecast range and 41% higher
year on year, thanks to a gain on
disposal.
?
P
In this Executive Board interview, Claus-Matthias Böge
and Olaf Borkers explain the highlights of financial year
2013, which included not only the pleasing operating
profit but also the newly introduced Kapitalanlage-
gesetzbuch (KAGB – German Capital Investment Code),
changes in the portfolio, the flood disaster at the start
of June, measurement gains, the dividend policy and
plans for further growth.
Interview: Nicolas Lissner, photos: Christian Schmid
009
DEUTSCHEEUROSHOPGESCHÄFTSBERICHT2013

this excellent shopping center, which has
around 200 shops and attracts over 16 mil-
lion visitors every year.
We should also mention that we added the
Herold-Center in Norderstedt to our portfo-
lio on 1 January 2013, and it made a signifi-
cant contribution to our growth in the previ-
ous financial year.
TALKING OF DRESDEN, HOW DID
THE DES SHOPPING CENTERS
LOCATED IN THE CITIES
AFFECTED BY THE TERRIBLE
FLOODING IN JUNE SURVIVE THE
DISASTER?
OLAF BORKERS: There was no danger of
flooding in the Altmarkt-Galerie in Dresden
and its underground garage. Luckily, the
flood disaster of 2002 did not repeat itself in
the centre of Dresden.
?
We initially expected funds from operations
to fall within a range of €1.99 to €2.03 per
share. By the end of the year, we had in-
creased the forecast to €2.06 to €2.09,
and the actual figure was €2.08.
YOU JUST MENTIONED A GAIN
ON DISPOSAL. CAN YOU GIVE US
ANY DETAILS?
CLAUS-MATTHIAS BÖGE: At the end of Au-
gust, we sold our 33% stake in the Galeria
Dominikanska in Wroclaw, Poland, which
was our smallest shareholding. This enabled
us to further optimise our portfolio, and im-
portantly, we were able to generate a profit
of €15.8 million.
HAVE THERE BEEN OTHER
CHANGES IN THE PORTFOLIO?
CLAUS-MATTHIAS BÖGE: Yes, on 1 May
we invested €132 million and purchased our
partner’s 33% stake in the Altmarkt-Galerie
in Dresden. We now have full ownership of
?
?
this excellent shopping center which hass from operations
There is no guarantee that the value
of real estate will carry on rising.
O O
010

Passau was one of the
first cities to be affect-
ed by the flooding. His-
torical high-water
marks that hadn’t been
breached for hundreds
of years were exceeded
by metres rather than
centimetres. Disaster
alerts were raised. As a
result, the Stadtgalerie
remained closed on 4
June, but water dam-
age in the shopping center was averted
thanks to the unstinting work of the on-site
technicians.
In Dessau-Roßlau, some of the bridges to
the city centre were closed for safety rea-
sons. This situation had a detrimental effect
on sales at the Rathaus-Center, since acces-
sibility was considerably reduced from the
north, south and east. The center itself is lo-
cated at one of the highest points in the city
centre, so there was no serious danger of
flooding. There was also no threat from
groundwater, since the center has a strong
protective sub-floor layer.
Fortunately, the Allee-Center in Magdeburg
also escaped the main impact of the disas-
ter: here it was mainly the flooded access
paths that affected business in the center.
For a short time, groundwater penetrated
the car park in the basement, so traffic rout-
ing had to be changed. But no other major
damage was observed.
CLAUS-MATTHIAS BÖGE: Fundraising
campaigns were quickly launched in the
centers affected by the flooding and space
was given to aid organisations in order to
support campaigns such as “Nachbarn in
Not” (neighbours in need). We contributed fi-
nancially to these spontaneous solidarity
groups for those affected by the flooding via
our property companies.
LET’S GO BACK TO THE RESULTS
FOR THE FINANCIAL YEAR. WHAT
DO YOU FEEL ARE THE KEY
THINGS TO MENTION?
OLAF BORKERS: The financial results
were positively affected by the sale of the
stake in the Wroclaw shopping center and at
€56 million, the measurement gain was also
very high. We were particularly pleased with
the value increases of the Altmarkt-Galerie
in Dresden, the Rhein-Neckar-Zentrum and
the City-Galerie Wolfsburg. The average value
increase across all centers was 1.9%.
CLAUS-MATTHIAS BÖGE: And as I always
emphasise: there is no guarantee that the
value of real estate will carry on rising. Even
though the returns for comparable shopping
centers in current transactions are some-
times significantly below the average return
for our portfolio (5.97%), we feel we are well
positioned with the rather conservative ap-
proach of the independent appraisers.
?
011011
We were particu-
larly pleased with the
value increases of
the Altmarkt-Galerie
in Dresden, the Rhein-
Neckar-Zentrum
and the City-Galerie
Wolfsburg.

STILL: FFO ALSO POSTED
A STRONG INCREASE OF
24%. HOW ARE SHARE-
HOLDERS BENEFITING
FROM THIS ONCE AGAIN
VERY GOOD RESULT?
CLAUS-MATTHIAS BÖGE: Together with
the Supervisory Board, we have slightly al-
tered our dividend policy. We are intending
to increase the dividend by 5 cents each
year up to €1.40 by the 2017 distribution.
This enables us to achieve reliable predicta-
bility for the participation of our sharehold-
ers in our operating profit as it increases
further.
WHAT CAN SHAREHOLDERS
EXPECT FROM DEUTSCHE
EUROSHOP IN 2014?
OLAF BORKERS: We are planning to invest
around €19 million in order to keep our
shopping centers in a good condition. No
refinancing arrangements are scheduled for
this year, but we are already discussing the
topics for 2015 with our banks. The dividend
is to rise to €1.30 per share in line with the
planning we have just presented.
CAN WE ALSO LOOK FORWARD
TO GROWTH IN THE PORTFOLIO?
CLAUS-MATTHIAS BÖGE: I think so. We
still have three opportunities to make our
portfolio grow: the purchase of new shop-
ping centers, extensions of centers that are
already in the portfolio, and finally stake
increases for centers that we do not yet
fully own.
For all three options, we have ideas that we
would like to put into practice. You’ll have to
wait and see.
THANK YOU
FOR TALKING TO US!
?
?
?
!
In any case, we are focusing more on the
development of the funds from operations,
which is a cash-based indicator, because
this is all we can use for a dividend payment,
investments in the portfolio and servicing
debt. Earnings per share can also include
measurement gains from valuation that only
exist on paper.
OLAF BORKERS: I agree with Mr Böge on
this. There is also one-off tax income as a
result of the Group restructuring. We there-
fore had several special factors that cannot
be expected every year in this form.
This also puts the “record consolidated prof-
it” of €171 million or €3.17 per share into
perspective slightly. Of course, we are happy
about the increase of 34%, but we shouldn’t
use this as a benchmark for the future.
Of course, we are happy about
the increase of 34 percent
O O
012

OLAF BORKERS
Member of the Executive Board
After serving as a ships offi cer with the German Federal Navy,
Mr. Borkers qualifi ed as a bank clerk with Deutsche Bank AG
in 1990. He then studied business administration in Frank-
furt/Main. From 1995, Mr. Borkers worked as a credit analyst
for Deutsche Bank AG in Frankfurt and Hamburg. In 1998, he
joined RSE Grundbesitz und Beteiligungs-AG, Hamburg, as
assistant to the Executive Board. In 1999, Mr.
Borkers was appointed to the Executive Board of
TAG Tegernsee Immobilien und Beteiligungs- AG,
Tegernsee and Hamburg, where he was respon-
sible for finances and investor relations until Sep-
tember 2005. In addition, Mr. Borkers held various
Supervisory Board and management positions
within the TAG Group. Olaf Borkers joined the
Executive Board of Deutsche EuroShop AG in Octo-
ber 2005. He is married and has two children.
After successfully qualifying as a bank clerk and completing a
business administration degree, Mr. Böge began his profes-
sional career in 1987 at the Düsseldorf-based Privatbankhaus
Trinkaus&Burkhardt in Mergers & Acquisitions. His work, for
which he was made a Prokurist (authorised signatory) in 1989,
focused on advising small and medium-sized companies on
buying and selling companies and equity interests. In 1990,
Mr. Böge was appointed to the management of KST Stahltech-
nik GmbH, a subsidiary of the Aus trian industrial plant con-
struction group VA Technologie AG, where he was responsible
for the fi nancial control, personnel, legal, tax and administra-
tion departments. In autumn 1993, Mr. Böge moved to ECE
Projektmanagement G.m.b.H.&Co. KG in Hamburg, the Euro-
pean market leader for the development, realisation,
leasing and longterm management of shopping cent-
ers. It was here that he first became fascinated with
the world of shopping centers. In addition to a series
of management positions at subsidiaries in the ECE
group, his work focused on concept planning, financ-
ing and ongoing profi tability optimisation of property
investments. Mr. Böge joined the Executive Board of
Deutsche EuroShop AG in October 2001. He is mar-
ried and has two children.
CLAUS-MATTHIAS BÖGE
CEO
013

We considered the development of the portfolio properties,
specifically their turnover trends, the accounts receivable and
occupancy rates, and the Company’s liquidity position. As the
mandates of six members of the Supervisory Board expired
in 2013 or will expire in 2014, we discussed our succession
ideas and made preparations for the Board’s future composition.
Regular discussions were conducted with the Executive Board regard-
ing trends on the capital, credit, real estate and retail markets and the
effects of these on the Company’s strategy. The Executive Board and
Supervisory Board also examined various investment options. We
received regular reports detailing the turnover trends and payment
patterns of our tenants and banks’ lending policies.
The Chairman of the Supervisory Board and the Executive Committee
of the Supervisory Board also discussed other topical issues with the
Executive Board as required. Transactions requiring the approval of
the Supervisory Board were discussed and resolved upon at the
scheduled meetings. In addition, circular resolutions were passed in
writing by the Supervisory Board for transactions of the Executive
Board requiring approval. All resolutions in the reporting period were
passed unanimously.
Meetings
Four scheduled Supervisory Board meetings took place during finan-
cial year 2013. The only absences were recorded at the meetings held
on 20 June 2013 and 26 November 2013: one member of the Super-
visory Board was excused from attending each meeting.
During financial year 2013, the Supervisory Board performed the duties
incumbent on it according to the law and the Articles of Association
and closely followed the performance of Deutsche EuroShop AG.
The strategic orientation of the Company was coordinated with the
Supervisory Board, and the status of the strategy implementation was
discussed at regular intervals. The Supervisory Board monitored and
advised the Executive Board on its management of the business, and
the Executive Board informed us regularly, promptly and in detail of
business developments.
On the day of the Annual General Meeting in 2013, Dr Jörn Kreke ended
his eleven-year membership of the Company’s Supervisory Board on
grounds of age. Through all these years, he closely supervised and
supported the development of Deutsche EuroShop AG. The Supervisory
Board thanked Dr Kreke for his dedication and wished him all the best.
Focus of advisory activities
We examined the Company’s net assets, financial position and results
of operations, as well as its risk management, regularly and in detail.
In this context, we checked that the formal conditions for implement-
ing an efficient system of monitoring our Company were met and that
the means of supervision at our disposal were effective.
We were informed on an ongoing basis of all significant factors affect-
ing the business.
Report of the
Supervisory Board
Dear Shareholders,O O
014

The Executive Board also reported on the acquisition of the 33% stake
in the Altmarkt-Galerie in Dresden, which had already been approved
and carried out.
At the third meeting on 25 September 2013, the Executive Board
reported again on the occupancy situation of the property in Pécs and
on a restructuring concept for the center. At this meeting we approved
a new €150 million credit line to replace the existing credit line, which
was due to expire in early 2014. A discussion also took place regard-
ing the question of whether the Company falls within the scope of the
Kapitalanlagegesetzbuch (KAGB – German Capital Investment Code)
in force since July 2013. The Executive Board shared with us its view
that the Company should be excluded from the scope of the KAGB and
reported that a formal application had been submitted to the Federal
Financial Supervisory Authority. We agree with the Executive Board’s
assessment and assume that the Federal Financial Supervisory
Authority will also confirm this view.
At the last meeting on 26 November 2013, the Executive Board
reported on preparations for a possible expansion of the properties
in Danzig and Hamburg-Harburg. We also held extensive discussions
on the projections for the past financial year and the Company’s
medium-term performance planning as presented by the Executive
Board. The Company’s future dividend policy was also discussed, and
a decision was taken to increase the dividend proposal to the share-
holders for the 2013–2016 financial years by €0.05 each year. In the
absence of the Executive Board we discussed the future composition
of the Supervisory Board and examined in detail the status of prepa-
rations required for this change.
Committees
The Supervisory Board has established three committees: the Execu-
tive Committee of the Supervisory Board, the Audit Committee and the
Capital Market Committee. Each of these is made up of three mem-
bers. The Executive Committee of the Supervisory Board functions
simultaneously as a nomination committee. Given the size of the Com-
pany and the number of Supervisory Board members, we consider the
number of committees and committee members to be appropriate.
During the reporting period, the Executive Committee of the Super-
visory Board and the Audit Committee met on 12 April 2013.
At the first scheduled meeting, on 23 April 2013, the Supervisory
Board’s annual review of efficiency was completed and the agenda for
the Annual General Meeting was approved. We selected the auditor,
who was proposed to the shareholders for election. In relation to the
audit of the annual financial statements, we once again attached great
importance to the explanations of the Executive Board and those of the
auditor on the real estate appraisals. In addition, the Executive Board
explained the financial, accounting and tax impact on the Group of the
corporate restructuring undertaken in 2012. The Executive Board also
reported on the conclusion of efforts to restructure the investment
structure in the Main-Taunus-Zentrum and on the progress made on
the sale of the investment in the Galeria Dominikanska in Poland. The
Executive Board also presented the possibility of acquiring the stake
(33%) in the Altmarkt-Galerie in Dresden. The Executive Board
explained the possible negative repercussions that implementation of
the European AIFMD via the KAGB might have for Deutsche EuroShop.
At the constituent meeting on 20 June 2013 following the Annual
General Meeting, we elected members by open ballot to various func-
tions on the Supervisory Board and its committees. The following were
elected and returned to office:
The Executive Board then reported on the sale of the stake in Galeria
Dominikanska. We approved the sale unanimously.
Chairman of the Supervisory Board Manfred Zaß
Dep. Chairman of the Supervisory Board Dr. Michael Gellen
Executive Committee Manfred Zaß (Chairman),
Thomas Armbrust,
Dr. Michael Gellen
Financial Expert Karin Dohm
Audit Committee Karin Dohm (Chairman),
Thomas Armbrust,
Manfred Zaß
Capital Market Committee Manfred Zaß (Chairman),
Thomas Armbrust
(Deputy Chairman),
Reiner Strecker
015
P

016
Financial statements of Deutsche EuroShop AG
and the Group for the period ending 31 December
2013
At the Audit Committee meeting on 15 April 2014 and the Supervisory
Board meeting on 23 April 2014, the Audit Committee and the Super-
visory Board respectively examined in detail the annual financial state-
ments of Deutsche EuroShop AG in accordance with German commercial
law, and the consolidated financial statements in accordance with Inter-
national Financial Reporting Standards (IFRS), each as at 31 December
2013, as well as the management report and group management report
for financial year 2013.
The documents relating to the financial statements, the auditor’s
reports and the Executive Board’s proposal for the utilisation of the
unappropriated surplus were presented to us in good time. The audi-
tor appointed by the Annual General Meeting on 20 June 2013 – BDO AG
Wirtschaftsprüfungsgesellschaft, Hamburg – had already audited the
financial statements and issued an unqualified audit opinion in each
case. The auditor also confirmed that the accounting policies, meas-
urement methods and methods of consolidation in the consolidated
financial statements complied with the relevant accounting provisions.
In addition, the auditor determined in the course of its assessment of
the risk management system that the Executive Board had undertaken
all required measures pursuant to section 91 (2) AktG to promptly iden-
tify risks that could jeopardise the continued existence of the Company.
The auditor’s representatives took part in the discussion of the annual
financial statements and the consolidated financial statements on
the occasions of the Audit Committee meeting on 15 April 2014 and
the Supervisory Board meeting on 23 April 2014 and explained the
main findings.
Following its own examination of the annual financial statements of
Deutsche EuroShop AG, the consolidated financial statements and the
corresponding management reports, the Supervisory Board did not
raise any objections. It agreed with the findings of the auditor’s exam-
ination and approved the annual financial statements of Deutsche
EuroShop AG and the consolidated financial statements. The annual
financial statements have thus been adopted. The Supervisory Board
endorses the Executive Board’s proposal for the utilisation of the unap-
propriated surplus and distribution of a dividend of €1.25 per share.
The Company’s success in financial year 2013 was the result of its
sustainable, long-term strategy and the dedication shown by the Exec-
utive Board and our employees, for which the Supervisory Board
would like to express its particular gratitude.
Hamburg, 23 April 2014
Manfred Zaß, Chairman
The Audit Committee also discussed the quarterly financial reports
with the Executive Board in conference calls on 14 May, 12 August and
11 November 2013. The Capital Market Committee did not meet in 2013.
Corporate Governance
In November 2013, together with the Executive Board, we issued an
updated declaration of conformity in relation to the recommendations
of the government commission pursuant to section 161 of the Aktien-
gesetz (German Public Companies Act – AktG) and made this perma-
nently available on the Deutsche EuroShop AG website. A separate
report on the implementation of the German Corporate Governance
Code is included in this Annual Report. The members of the Super-
visory Board and the Executive Board declared in writing at the begin-
ning of 2014 that no conflicts of interest had arisen.
Manfred Zaß
Chairman of the Supervisory Board

Name
Manfred Zaß
(Chairman)
Dr. Michael Gellen
(Deputy Chairman) Thomas Armbrust
Born: 1941 1942 1952
Place of residence: Königstein im Taunus Cologne Reinbek
Nationality: German German German
End of appointment: 2015 Annual General Meeting 2014 Annual General Meeting 2014 Annual General Meeting
Committee activities: Chairman of the Executive Committee,
Member of the Audit Committee,
Chairman of the Capital Market
Committee
Member of the Executive Committee Member of the Executive Committee,
Member of the Audit Committee,
Deputy Chairman of the Capital Market
Committee
Membership of other
statutory supervisory
boards:
– – C.J. Vogel Aktiengesellschaft für
Beteiligungen, Hamburg (Chairman)
Platinum AG, Hamburg (Chairman)
TransConnect Unternehmensberatungs-
und Beteiligungs AG, Munich (Chairman)
Verwaltungsgesellschaft Otto mbH,
Hamburg
Membership of com-
parable supervisory
bodies of business
enterprises in Germay
or other countries:
– – ECE Projektmanagement
G.m.b.H.&Co. KG, Hamburg
(Chairman)
Profession: Banker Independent lawyer Member of Management,
CURA Vermögensverwaltung G.m.b.H.,
Hamburg
Key positions held: 1965–2002: DekaBank Deutsche
Girozentrale, Frankfurt of which:
1980–1999: Member of the
Executive Board
1999–2002: Chairman of the
Executive Board
until 2005: Deutsche Börse AG,
Frankfurt, Deputy Chairman of the
Supervisory Board
2008–2009: Hypo Real Estate Group AG,
Unterschleißheim, Member of the
Supervisory Board
1971–1983: Deutsche Bank AG,
Düsseldorf, Frankfurt
1984–1995: Deutsche Centralbodenk-
redit-AG, Cologne, Member of the Exec-
utive Board
1995–1997: Europäische Hypotheken-
bank AG, Luxembourg,
1997–2000: Deutsche Bank AG,
Frankfurt, Managing Director
2001–2003: DB Real Estate GmbH,
Frankfurt, Managing Director
until 1985: Auditor and tax advisor
1985–1992: Gruner+Jahr AG&Co KG,
Hamburg, Director of Finance
since 1992: Member of Management of
CURA Vermögensverwaltung G.m.b.H.,
Hamburg
(Family Office of the Otto Family)
Relationship
to majority/
major shareholders:
none none Shareholder representative of the
Otto family
Deutsche EuroShop
securities held as at
31 December 2013:
10,000 0
Members of the Supervisory BoardO O
017

Name Karin Dohm Dr. Henning Kreke Alexander Otto
Born: 1972 1965 1967
Place of residence: Kronberg im Taunus Hagen/Westphalia Hamburg
Nationality: German German German
End of appointment: 2017 Annual General Meeting 2018 Annual General Meeting 2018 Annual General Meeting
Committee activities: Chairwoman of the Audit Committee /
Financial Expert
– –
Membership of other
statutory supervisory
boards:
– – Verwaltungsgesellschaft Otto mbH,
Hamburg
Membership of com-
parable supervisory
bodies of business
enterprises in Germay
or other countries:
– – Peek&Cloppenburg KG,
Düsseldorf
Profession: Head of Group External Reporting,
Deutsche Bank AG, Frankfurt
Chairman of the Executive Board,
DOUGLAS HOLDING AG,
Hagen/Westphalia
CEO,
Verwaltung ECE Projektmanagement
G.m.b.H., Hamburg
Key positions held: 1991–1997: Studied business and
economics in Münster,
Zaragoza (Spain) and Berlin
2002: Steuerberaterexamen
(German tax advisor exam)
2005: Wirtschaftsprüferexamen
(German auditor exam)
1997–2010: Deloitte&Touche GmbH,
Berlin, London (UK), Paris (France)
2010–2011: Deloitte&Touche GmbH,
Berlin, Partner Financial Services
since 2011: Deutsche Bank AG, Frank-
furt, Head of Group External Reporting
Studied business (BBA and MBA)
at the University of Texas at Austin, USA
Doctorate (political science) from the
University of Kiel, Kiel
1993 until today: DOUGLAS HOLDING AG,
Hagen/Westphalia
of which 1993-1997:
Executive assistant
1997-2001:
since 2001: Chairman of the
Executive Board
Studied at Harvard University
and Harvard Business School,
Cambridge, USA
1994 until today: Verwaltung ECE
Projektmanagement G.m.b.H., Hamburg
since 2000: Chief Executive Officer
Relationship
to majority/
major shareholders:
none none Major shareholder
Deutsche EuroShop
securities held as at
31 December 2013:
0 0 5,247,124
Members of the Supervisory Board
Continuation
O O
018

Reiner Strecker Klaus Striebich Dr. Bernd Thiemann
1961 1967 1943
Wuppertal Besigheim Münster
German German German
2017 Annual General Meeting 2017 Annual General Meeting 2014 Annual General Meeting
Mitglied des Kapitalmarktausschusses – –
akf Bank GmbH&Co. KG, Wuppertal MEC Metro-ECE Centermanagement
GmbH&Co. KG, Düsseldorf
(Chairman of the Advisory Board)
Unternehmensgruppe Dr. Eckert GmbH,
Berlin
Deutsche Pfandbriefbank AG,
Unterschleißheim (Chairman)
Hypo Real Estate Holding AG,
Unterschleißheim (Chairman)
M.M. Warburg&Co. KGaA, Hamburg
(Deputy Chairman)
Wave Management AG, Hamburg
(Deputy Chairman)
IVG Immobilien AG, Bonn
VHV Vereinigte Hannoversche
Versicherung a.G., Hanover
VHV Lebensversicherung AG, Hannover
Hannoversche Direktversicherung AG,
Hanover
– – Würth Gruppe, Künzelsau
(Deputy Chairman)
Würth Finance International B.V.,
Amsterdam (The Netherlands)
Managing Partner,
Vorwerk&Co. KG, Wuppertal
Managing Director Leasing,
G.m.b.H., Hamburg
Management consultant
1981–1985: Studied business
in Tübingen
1986–1990: Commerzbank AG, Frankfurt
1991–1997: STG-Coopers&Lybrand
Consulting AG, Zurich (Switzerland)
1998–2002: British-American Tobacco
Group, Hamburg, London (UK),
Auckland (New Zealand)
2002–2009: British-American Tobacco
(Industrie) GmbH, Hamburg, Member of
the Executive Board for Finance and IT
2009 until today: Vorwerk&Co. KG,
Wuppertal
since 2010: Personally liable/
managing partner
Studied business in Mosbach
1990: Kriegbaum Gruppe, Böblingen,
Assistant to the Management Board
1992 until today: Verwaltung ECE
Projektmanagement G.m.b.H., Hamburg
since 2003: Managing Director Leasing
1976–1991: NORD/LB Norddeutsche
Landesbank Girozentrale, Hanover
of which 1976–1981: Member of the
Executive Board
1981–1991: Chairman of the
Executive Board
1991–2001: DG Bank Deutsche
Genossenschaftsbank AG, Frankfurt,
Chairman of the Executive Board
none Member of the Management Board of
G.m.b.H., Hamburg (Alexander Otto
(major shareholder) is the Chairman of
the Management Board)
none
3,975 20,500 6,597
019

Dark side of the new
shopping paradises
Not everything brought by the parcel
service elicits a scream of delight.
Downside of the online shopping boom.
Shopping from the comfort of your own sofa is like romping
around in a modern-day land of milk and honey: just a few
clicks, a short wait, and then whatever products might have
caught your fancy start arriving via parcel services and piling
up on your living room floor. While traditional merchants are
still pondering on whether it is even possible to make money
online, growth in revenues generated by digital sales channels
is picking up speed. Depending on statistics, in terms of their
share of Germany’s total retail sales these channels already
cleared the 10% hurdle in 2013. And with forecasts predicting
growth rates of up to 23%, the sense of excitement in
the world of digital retail is palpable. Yet, in the wake of the
deluge of online orders, there are some dark clouds moving in.
“Scream with delight or
send it back!”,
is what online shoppers think
with amazing frequency. Accord-
ing to calculations by the Returns Manage-
ment research group of the University of
Bamberg, while a billion packages containing
online purchases might roll through Germany
every year, retailers will see nearly a third of
those again. Björn Asdecker of the Chair of
Logistics in Bamberg helps visualise just how
enormous this amount is: “Assuming a parcel
length of 40 cm, the 286 million returns could circle the
Earth’s 40,000 km circumference 2.9 times.” Broken down
by sector, one in two fashion parcels, one in five electron-
ics parcels and one in ten book parcels finds its way back
to the sender. What these averages fail to reveal is that
returns for gift items are in the single-digit percentage
range whereas return rates for fashionable women’s at-
tire can be up to 80%.
The unrestrained frenzy of online orders is currently pro-
ducing some rather outlandish consumer behaviours: In
the new sharing economy, a smart consumer is a user, not
an owner, and online merchants are not immune to this
trend. The perfect dirndl for Oktoberfest or the little black
dress for a reception is ordered just in time for an event
and sent back the very next day. Groups of teenagers place
veritable tidal waves of orders to transform their home
living rooms into catwalks for just a few hours. Another
similar nuisance are frivolous buyers who might order
five handsets when a new mobile phone is launched, then
only keep the one that arrives first. According to the Bam-
berg study, nearly one in five (18.6%) of the 538 people
surveyed under the age of 30 admits to having exploited
cancellation rights. And merchants are left to foot the bill,
namely between €5 and €17 for processing a return, post-
age and handling. Plus, generally speaking, the smaller
the online shop and parcel volume, the more expensive
this becomes. If you add to that the fact that one in every
ten returns can no longer be offered as new merchandise
or might even be unsellable, doubts arise as to the poten-
tial of this kind of business model to turn a profit.
N
Hassle-free online consumption is causing retailers a lot
of hassle. Whether this business model even pays off in
segments with high return rates remains to be seen.
DEUTSCHEEUROSHOPANNUALREPORT2013/SHOPPING
020
S

021

022

“Distance selling without returns
doesn’t work”,
returns Martin Barde, who has been advising distance
selling retailers of all sizes for 15 years, calms anxieties
surrounding. He makes a clear distinction, however,
between returns of merchandise ordered for the purpose
of trying something on and those prompted by disappoint-
ment in the product. The first is a customer service and
unavoidable outside of bricks and mortar stores. The sec-
ond is negligence on the part of the merchant – either the
quality is lacking, images of the product are not clear
enough or the goods are faulty. In other words, causes that
can and should be fixed. Yet this still does not happen of-
ten enough. “Quite a few merchants would rather under-
calculate their return costs, only a few work on system-
atically reducing them and even fewer try to prevent
returns prompted by dissatisfaction,” is Barde’s sobering
conclusion.
The easiest way to reduce this unnecessary carting
around of merchandise would be to demand payment in
advance and charge return postage. That would put a
damper on the enthusiasm of anybody with the “trying it
is free” mentality. Yet, for 38% of Germans, purchase on
account is their preferred payment method (BVH – Ger-
man E-Commerce and Distance Selling Trade Association).
And even once merchants have been legally freed from
the obligation to cover the cost of returns for merchandise
valued at under €40, from summer 2014, Dr Georg Witt-
mann, a logistics professor in Regensburg, is sceptical
that this will have any impact on standard practices: “Ac-
cording to our research, large merchants want to continue
allowing free returns. If that is the case, small merchants
will have to play along to avoid losing customers.” In other words:
Eliminating privileges would mean losing sales and customers to com-
petitors with more attractive terms and conditions. Environmentally-
minded players like Trigema are willing to take that chance, but they
are fairly alone on this. Barde sees yet another reason to hold on to
the standards: “Full shopping baskets are the goal. As orders grow in
size, experience shows that the total value will also increase. The more
each individual customer purchases, the less impact returns will have,”
is the logical conclusion drawn by this consultant.
N
Prospective buyers need to touch. Sensory experiences are a given
at local retailers, returns are inevitable at virtual ones.
Environmentally-friendly shopping looks different!
If the calculations of DHL, the market leader, are correct, the delivery
of each of its packages causes the emission of nearly 500 grams of
environmentally hazardous greenhouse gases.While that might sound
manageable at first, extrapolating this figure to reflect the total num-
ber of orders reveals that the 800,000 returns alone release a whop-
ping 400 tonnes of CO2 into the air every day. The business magazine
Plusminus calculated that these emissions are equivalent to 255 car
trips from Frankfurt to Beijing.
If sofa shopping replaced a trip to a bricks and mortar store, however,
online purchases could actually be more environmentally friendly. A
privately owned medium-sized car would travel about 3.5 km to pro-
duce 500 grams of CO2 emissions. Yet, according to the Institute for
Applied Ecology in Darmstadt, consumers travel an average of 6 km
to go shopping. That would mean that an online order would be 2.5 km
more environmentally friendly – assuming no return is made and only
one delivery attempt is needed. Otherwise the balance shifts in favour
of local retailers. Another point in their favour: Shopping trips usu-
ally satisfy multiple requirements, while one of the charms of online
shopping lies in the ability to place ad hoc orders. And since more and
more online shoppers want to have everything delivered immediately,
clicking the “Order” button causes even more trees to suffer. Express
shopping reduces full vehicle utilisation, generates additional traffic
and causes single orders to be shipped out in multiple parcels if indi-
vidual products are not in stock.
If you add to that the boxes and crates, packaging materials and plastic
wrapping, without which no merchandise can be delivered, a merchant
around the corner is clearly the greener alternative. Not only that, but
if several providers’ current plans to enter the grocery business on a
large scale this year prove successful, other environmental sins are
inevitable. Fresh produce and refrigerated items cannot be transported
safely without Styrofoam sleeves and bubble wrap.
N
Click-to-buy is simple, finding a solution to our environmental prob-
lems is not. And sometimes online merchants add to the garbage and
pollution problem.
Returns for gift items are
in the single-digit percentage
range whereas return rates
for fashionable women’s attire
can be up to 80%.
023

Time saved or lost?
Efficiency and convenience are the main promises made by
e-commerce. After all, 57% of respondents in DHL’s e-Com-
merce 4.0 study considered it to be a real time-saver. That
concurs with the famous “scream with delight” ad featuring
an unfailingly smiling package delivery person bringing par-
cels to euphoric online shoppers who always happen to be
home when the doorbell rings. But aren’t digital buyers de-
ceiving themselves? In real life the buying process is often
quite different. High return rates and home delivery mistakes
surely put a damper on any feelings of joy. More and more
neighbours and managers have begun refusing to accept
parcels for frequent orderers and spending Saturdays stand-
ing in endless queues at the post office has become a na-
tional sport. How convenient really is a weekend shopping
trip with a bulky package under your arm? Not only that, but
if the merchandise fails to live up to what its photo promised,
the size is wrong or the item has a flaw, all the effort was in
vain. Then you have to put everything back in the box, print
out the return ticket and head to the parcel shop.
Make no mistake – online shopping is extremely efficient in
ideal circumstances. How likely these are to arise depends
on the product. For mailbox-sized books the chances are
good, but the same cannot be said about frequently ex-
changed fashions arriving in large boxes. Since it would be
better from an economic, environmental and service per-
spective if the postman only had to ring once, delivery ser-
vices are working hard to come up with solutions. Pack and
pick-up station networks are becoming denser, parcel box-
es are being installed in front gardens and delivery appoint-
ments are arranged in advance. Yet, depending on the ser-
vice used, this increases the cost of delivery for customers.
N
Check before placing an order. Only people who know ex-
actly what they are getting and have made arrangements
to receive their parcels save time by buying online.
Job motor or parcel slaves?
Logistics centres are popping up all over Germany, and par-
cel services are expanding. While the country’s largest on-
line retailer refuses to specify how many people it employs,
around 14,000 seasonal workers were helping the compa-
ny cope with order peaks at the end of the year. On the bus-
iest days, up to 450,000 items are packed at fulfilment cen-
tres that can be as large as eleven football pitches. That
clearly positions e-commerce closer to industry than to tra-
ditional retailing. The price for this amazing logistical
achievement is paid not least by its employees. The market
leaders repeatedly come under fire for putting enormous
pressure on workers to perform and paying meagre wages.
For anybody who considers the ARD report en-
titled “Ausgeliefert!” (a German word that can
mean both “delivered” and “at somebody’s
mercy”) too sensationalistic might find that the
documentary by BBC reporter Adam Littler
paints a more realistic picture. Littler is a jour-
nalist who had a temp job working
at the British branch of a large U.S.
mail order company during the
Christmas season. There he
rushed around spacious halls,
sometimes covering distances of
up to 17 km every night. He
climbed steep metal ladders in oc-
casionally dark hallways to scan
ordered merchandise and load it
into his cart. And because workers
are tasked with packaging up to
110 products every hour, it all has
to happen in seconds. If they miss
their target, a report is filed. Inter-
connected scanners display real-time perfor-
mance curves to the line manager. If perfor-
mance drops, the manager recommends an
energy drink. Calling in sick will earn an em-
ployee one penalty point, coming in two min-
utes late is worth half a point. At two points, the
On the busiest
days, up to
450,000 items are
packed at fulfil-
ment centres that
can be as large as
eleven football
pitches.
024

line manager will issue a “final
warning”. Littler’s summary: He
feels like a robot, not a person. Mi-
chael Marmot, an expert on stress
at work consulted by the BBC, stat-
ed that this way of working in-
creases the risk of mental and
physical illness.
The U.S. group issued an official
statement in which it vehemently
denied allegations of exploitation
and labour law violations. Yet,
even if the documentary was exag-
gerated and circumstances were
exceptional due to the Christmas
season, one thing is clear: the
many thousands of online orders
are creating packing machines
working against the clock. Grant-
ed, €400 jobs at a bakery or as a
discount store cashier before the
holidays are neither stress-free nor well-paid.
But the pressure they experience is still far re-
moved from that of a packer.
N
The more quickly and cheaply consumers
want their merchandise, the more stressful
and time-oriented the working conditions be-
come for people working in logistics.
Growth or downward spiral?
E-commerce is growing, that much is certain.
Yet, the extent of this growth is unknown. The
German Retail Federation (HDE), for instance,
puts sales at €33.1 billion and expects a 17%
increase in the year ahead to €38.7 billion. Ac-
cording to a representative of the German E-
Commerce and Distance Selling Trade Asso-
ciation (BVH), e-commerce already hit this
mark last year when it generated €39.1 billion
in sales. Anticipating a whopping 25% growth
in 2014, to €48.8 billion, he looks ahead to the
current year with confidence. “Official statis-
tics don’t capture the phenomenon correctly,
the studies are rather vague in places,” admits
Dr Kai Hudetz, Managing Director of the E-
Commerce Center (ECC) at the Center for Re-
search in Retailing (IFH) in Cologne. His cent-
er has been studying the rise of e-commerce
for 15 years. Deviations could stem from dif-
ferences between gross and net amounts, ad-
justments for returns, different definitions of distance selling and even
the quality of the data provided: “A lot of market data is based on sta-
tistical projections because only very few online merchants are re-
quired to disclose their figures. The majority of this information is
provided on a voluntary basis and only a few multi-channel retailers
break their earnings down by sales channel,” he explains. Certainly,
online sales account for over 8% of total retail sales, over 15% not in-
cluding groceries, and this share is growing steadily across all seg-
ments.
N
Market figures indicate trends, yet are no substitute for a differenti-
ated focus on products, segments and business models.
The uptrade that is a downtrade in actuality
But who is winning the market share game? “The clear winners in terms
of sales are the market-leading pure players, clever niche concepts and
manufacturers’ brands. E-commerce works extremely well for vertical
retailers like H&M or Zara, but sellers of third-party brands with inter-
changeable products are struggling against price-sensitive online com-
petitors,” says Hamburg-based e-commerce consultant Alexander Graf as
he explores the reasons behind the success of various business models.
According to the ECC in Cologne, pure players have the biggest slice of
the online pie with 35.4% of the market – followed closely by the online
sales channels of bricks and mortar retailers (29.3%). Cause for concern,
however, is the growing concentration of power with three major pure
players. The six-letter market leader alone generated sales of €7.8 bil-
lion last year, which represents nearly a quarter of all e-commerce rev-
enue in Germany. Business might be booming, yet profits are a rarity.
The race for power and market share takes its toll. So far, no market
analyst has disproved the notion that the price and service strategies of
the megaplayers are not subsi-
dised business models. Not to
mention the tax loopholes, paltry
wages, unfair working conditions
and unfair terms and conditions
for merchants that cause an up-
roar time and time again.
In order to persuade more and
more buyers to get on board, the
online giants invest enormous
amounts of money in perfecting
their customer journey, delivery
services and returns manage-
ment. eBay and Amazon alone
spent a total of $4.75 billion on
R&D in 2012. Being first movers,
they might bear high development
risks, however they also push the
restoftheindustrytoadoptanever-
ending stream of new standards.
500g
Greenhouse gas emissions caused
by the delivery of one package
400t
Total CO2 emissions released by
800,000 returns every day
255
Number of car trips from
FrankfurttoBeijing which would
generate an equivalent amount
of CO2 emissions
FACTS & FIGURES
025

Following “big data” and “same day/hour delivery”,
“dynamic pricing” is the latest battle cry. Future prices
will be adjusted to reflect the competitive situation in an
effort to topple old pricing schemes and maximise profit
margins. If traffic is high but sales are low, prices will
drop. If money is rolling in, products will become more
expensive.
With the business climate becoming harsher, whether
or not these giants will continue their triumphal march
is uncertain: A harmonisation of e-commerce laws is
pending in the USA, which will close lucrative tax loop-
holes; in Great Britain, citizens’ initiatives are demand-
ing the same be done in Europe. In mid-2013, the giant
retailer yielded to the German competition authority.
Marketplace merchants no longer have to offer their
wares at the lowest price. And the competition authority
is also looking into whether DHL delivers under cost for
certain key account customers.
N
Large pure players have proven that huge budgets can buy market
share.What they have yet to prove is whether this makes sense from
an economic, environmental or social perspective.
Bustling cities doomed to obsolescence?
Michael Groschek, the Transport Minister for North Rhine-Westphalia,
recently declared “sofa shopping” to be the new greenfield destroying
city centres. Communities were complaining more and more about
declining numbers of pedestrians walking through city centres and
increased congestion due to delivery traffic. “Shoes ordered online
aren’t sent through the Internet, they travel our real-world streets to
get to peoples’ homes,” explains this politician from Germany’s Social
Democratic Party (SPD). While Amazon and DHL are already contem-
plating out loud the use of delivery drones, politicians are busy finding
ways of easing the urban traffic situation, whether this solution in-
volves presorting in city logistics centres, a parcel toll or even local
access restrictions. But what about pedestrian traffic? Footfall, a com-
pany that performs ongoing measurements of the number of people
entering its customers’ shops, recorded a total decline of 2.6% in 2013.
“Prime locations remain prime. Pres-
sure on mid-range locations is increas-
ing. Action needs to be taken in rural
areas,” is how the German Retail Fed-
eration (HDE) sums up the different sit-
uations faced in city centres. Yet, even
in locations with consistently high lev-
els of pedestrian traffic, this transfor-
mation is leaving its marks: “Tenants
in prime locations are changing, and
retail spaces are becoming more like
showrooms. Particularly retailers with
weak concepts are unable to withstand the massive pressure
on margins. Instead, the future will bring even more vertical
concepts, manufacturers’ stores offering their own brand or
even retailers with strong private labels,” summarises Elab-
oratum’s retail and multi-channel expert, Stefan Mues.
What remains unsaid is that the competitive situation is un-
dergoing a shift. In the past, cities once fought against
greenfield projects and traditional retailers against shop-
ping malls. While it might hold true that communities still
protect their city centres against overly ambitious special-
ist store projects, they let logistics centres sprout up almost
unchecked. And that despite the fact that a delivery person
is indifferent to whether his or her deliveries might include
products that could negatively impact local sales or goods
ordered after closing time. In Retail Real Estate Report
No. 166, Prof. Wolfgang Christ of the Urban Index Institute
sums up the competitive situation as follows: Today, it is
high street vs. high tech or, in other words, the locations in
a city where customers can walk or drive to vs. the omni-
present online locations of the pure players. With an eye to
successful efforts to prevent urban decay in Bath, Bristol
and Liverpool, he pleads the case for urban transformation
as a way of dealing with the retail transformation. Locations
that have proven attractive are those that blend the
According to a representative of
the German E-Commerce and
Distance Selling Trade Association
(BVH), e-commerce already hit this
mark last year when it generated
€39.1 billion in sales.
026

traditional features of a shopping mall, such as brand-name
labels, store diversity, convenience, atmosphere and pro-
fessional management, with small-scale urbanity and local
flair. Loosely interpreted, this means that the highest-
paying tenants alone will not be enough to lure online shop-
pers away from their screens. The only way to ensure that
shopping venues attract customers in future is by offering
not only a lively blend of catering, leisure activities and
fun but also health and wellbeing providers and public
services. Anybody following the evolution of modern shop-
ping centers in Germany can see precisely these trends
reflected.
N
Online retailing is autistic, yet cities and retailing are mu-
tually dependent. If we want to avoid being wholly de-
pendent on the Internet someday, investing in cities and
retail is more worthwhile than ever.
Don’t ignore, integrate!
Amazon has been active in the book market since 1998,
and in 2014 the company plans to enter the food retail seg-
ment. With revenue in this area only accounting for less
than 0.3% of total online sales, it is considered the last bas-
tion of bricks and mortar re-
tail – unlike media and fash-
ion which, according to
Statista, have already lost
29% and 18%, respectively,
to the Internet. But shop-
keepers are capable of
learning! Ten years ago, the
bookstore Thalia countered
the cyber attack by offering
larger stores and a bigger
selection. In doing so, it not only underestimated the seem-
ingly infinite range of products available online but also
customers’ need to order whenever they want and their
demand for convenience. Whether Edeka, Rewe or Tengel-
mann – these food retailers have long since begun testing
their own delivery and click-and-col-
lect services (online orders with in-
store pick-ups) and are ready to meet
customers’ changing needs.
These are referred to as multi-chan-
nel and omni-channel concepts, and
they mesh e-commerce with bricks
and mortar shops. And they are
booming among chain stores, not
least because click-and-collect pick-
up stations prompt customers to visit
the store. “We’ve now reached a point
where one in every ten online orders is placed from a physical store
because customers see an item and then order it via a mobile device,”
explains Marcel Beelen, Vice President Business Development at DHL.
Not only that, but investments in the shopping environment are at re-
cord highs as bricks and mortar stores’ key competitive advantage over
the world of virtual shopping. The EHI Retail Institute reported that €4.8
billion have been spent on store expansions and renovations. Also pos-
itive is the fact that local retailers are developing a strong sense of what
they have to offer customers: Merchants in Hamburg protested against
the practice of showrooming – looking offline and buying online – and
its detrimental impact on business by covering up their windows and
refusing to accept parcels. The owner of one photo shop in Munich
charges up to €25 for a consultation which can then be credited towards
the customer’s purchase. Retailers in Augsburg, with the support of a
local TV and radio station, promoted shopping locally with a campaign
entitled “Leave the click in your city”, which aroused quite a bit of sym-
pathy for many longstanding traditional retailers! After all, 38% of those
surveyed after the campaign had decided to change their shopping hab-
its. Since then, the station has been inundated with enquiries from oth-
er communities and additional campaigns will be launched soon in cities
from Aschaffenburg to Würzburg.
N
Every day, bricks and mortar retailers are getting a little better at
bringing together the best of both worlds of shopping.
SUMMARY:
It is a well-known fact that, while progress cannot be stopped, it can
be steered. Convenient clicks of the mouse have long since become
an established part of modern shopping experiences. Luckily, physi-
cal retail has realised that it has a pole position when it comes to link-
ing customers’ shopping enjoyment with their love of ordering online.
This puts retailers in a position not only to defend their own market
share but also to solve problems like parcel pick-up, exchanges and
try-ons in a way that is more time-efficient and environmentally
friendly than pure-play online merchants. When all is said and done,
whether they are destined to win the race against the pure players’
ample war chests will also depend on whether they make far-sighted
investments in software, real estate and communications.
Rahel Willhardt has been working as a freelance journalist for
national newspapers,professional journals and magazines for
twelve years. She has become a well-established profession-
al writer who specialises in the areas of retail, architecture,
the real estate industry and marketing. Ms Willhardt follows
two principles in her work: articles should be informative and
entertaining (professional feature articles),and the stories they
present should risk a glimpse at the bigger picture.
ABOUT THE AUTHOR
027

028

The digital
shopping
center
Is the end nigh for bricks and mortar retail-
ers? Won’t we soon all be shopping online
rather than on foot? The market research
company GfK expects to see intelligent
coexistence of physical and online retail-
ing. It would be fruitless and blinkered to
try to hold back the march of internet shop-
ping. Rather, the smart linking of physical
and virtual contact interfaces, particularly
in managed retail properties, is opening
up new opportunities to support consum-
ers any time, any place, and to offer them a
seamless, attractive and innovative shop-
ping experience across all channels.
One thing is clear: people will con-
tinue to enjoy visiting shops, but at
the same time will also appreciate
the benefits of making web purchases. Online shopping is
especially practical for goods that are similar and inter-
changeable. The way in which well-designed shop con-
cepts have always led us to spend more money that we
originally planned is staggering. The online channel is
simply making the market narrower, like every structural
change before. However, different sectors and retailers
are not equally affected by the shift in business to the net.
What is happening is that the gulf between strong and
weak concepts is widening:
O DEUTSCHEEUROSHOPANNUALREPORT2013/SHOPPING
029
P

There are both very successful online-only stores such as Amazon
and very successful offline-only stores such as Primark, and the fu-
ture of getgoods.de is no more questionable than that of ProMarkt.
Smart linking of the respective benefits of the online and offline
spheres holds vast promise. It is clear that multi-channel concepts
are growing in significance, and where they make sense – which is
not the case for all products and all brands – online spending can boost
sales in stores, and vice versa. You then get something greater than
the sum of the parts.
GfK surveys show that customers regard the freedom to decide when,
where and how to make purchases as the greatest benefit of multi-
channelling. Retailers that offer customers the option of the most con-
venient or advantageous way to shop can more than make up for de-
clining sales at bricks and mortar stores through online orders. The
future sales structure of a traditional retailer following the successful
rollout of a multi-channel model might look as follows:
There are already a whole host of different multi-channel concepts in
operation. Here are just a few examples of the forms they take, bear-
ing in mind that this is a very fast-evolving area.
1. CLICK & COLLECT
Goods are ordered online and collected from or returned to a store.
The benefit is that unlike when orders are delivered to the doorstep,
customers retain the autonomy to accept the goods, obtain additional
support and if necessary return the item immediately. UK figures sug-
gest that this business could grow to around 20% of total store sales
in just a few years, making up for possible decreases in
pure in-store sales. Gravis puts the pick-up rate of its click
and collect concept at just under 30%, while the equiva-
lent programmes at MediaMarkt and Saturn represent as
much as 40–45% of all online sales.
AIMPACT: Retailers will increasingly need more small
stores, in order to have a dense network of collection lo-
cations; additional branches or collection-only points
could be set up at high-footfall locations and transport
hubs. Some stores will, however, need greater storage
space to hold goods ordered online.
2. DIGITAL SHOPPING CENTERS
Center managers operate an online store for the tenants
of their shopping centers or for a portfolio of shopping
centers. This online shop can be used to prepare for a
physical visit to one of the centers, to check products and
prices or to make a direct purchase. It enables the shop-
ping center to expand its breadth of services and products.
The boundaries between offline and online are disappear-
ing, and both channels benefit from this process. Altarea
Cogedim was a trail-blazer in this regard, with its “Rue du
Commerce”, established in 2011. ECE and Unibail are con-
templating similar models.
A
A
A
A
A
60
50
40
30
20
10
0
BREAKDOWN OF A FASHION RETAILER’S SALES
Pure online purchases
Ordered in store,
dispatched by post
Ordered online,
collected in store
Online research,
purchased in store
Pure in-store
purchases
2008 2010 20172012 2022
030

AIMPACT: Depending on the terms of the contracts un-
derlying the online shops, shopping centers may also be
able to share in their tenants’ online revenues. Tenants in
turn can attract less web-savvy customers to their online
shops and offer products that are not physically available
at the center.
3. AUGMENTED REALITY
This heading encompasses virtual displays and trying-on/
testing functionalities, be that of clothes, shoes, toys or
furniture. While out shopping, consumers can access the
online offering via QR codes and then use video kinetic
scans in the form of moving images adapted to their own
bodies or a chosen environment, test the goods out and
then, of course, order and pay for them. Although virtual
applications have to date been regarded as high-tech toys, technical
innovation is now delivering tangible benefits. In Germany, for exam-
ple, Görtz, Adidas and Lego are testing virtual shoe fitting, a virtual
shopping wall and a digital box respectively.
AIMPACT: The area required for selected locations will go up where
virtual applications taking up large amounts of space are implemented.
4. ONLINE GOES OFFLINE
In an ideal scenario, a multi-channel strategy brings together the
strengths of offline retailing with its online counterpart. A network of
shops enables online retailers to reach digital refuseniks, gives them
an edge in terms of service by offering a collection option and makes
it easier for customers to exchange goods. This offline
presence also strengthens trust in the brand, which is
additionally reinforced in shoppers’ mindsets through
increased awareness. Examples include the concepts
from Cyberport, Globetrotter, MyMüsli, Planet Sports
and SuitSupply.
AIMPACT: Online retailers will look for shop sites at selected loca-
tions and will increase the diversity of and innovation in store struc-
tures in cities and shopping centers. The number of flagship stores
will go up, and rents on these need not be covered by in-store pur-
chases alone.
5. MOBILE APPLICATIONS – COUPONING
Discounts on store entry: Even online bargain hunters shop in bricks
and mortar stores from time to time. Smartphone apps enable users
to participate in reward programmes when shopping in stores. Loy-
alty points are earned through certain behaviours, such as entering a
store, walking toward a shelf, checking a product or ultimately mak-
ing a purchase. The app also sends the customer customised offers.
These applications require transmitter devices in the cooperating
stores.
AIMPACT: Sophisticated bonus programmes attract on-
line fans back into physical stores. Caution is advisable,
however, as smartphone customers are some of the best-
informed and therefore most challenging out there.
What does that mean for retail property
of the future?
We have developed three hypotheses on the
implications of multi-channel concepts for physical
retail locations.
Physical stores will evolve from points of pur-
chase into touch points. Branches will remain
a key element in the multi-channel strategy,
as they are the only place where the physical
brand experience can be felt.
When customer types are broken down, by
far the greatest share of spending is by “dual
customers”, who make both online and offline
purchases. Managed retail locations offer the
best conditions for implementing and linking
up their tenants’ multi-channel concepts.
Multi-channel will intensify the requirements
in terms of professionalism on both the prop-
erty and the tenant sides. The customer
journey – that is to say, customers’ decision-
making and purchasing processes – must be
understood if their needs are to be seamlessly
latched on to.
1
2
Manuel Jahn is Head of
Consulting in the geo-
marketing solution area
of GfK. He has worked
for GfK since 2004 and
gathered extensive ex-
pertise in the retail and real estate industries through consulting
on locations and properties across the whole of Europe. He was
previously involved in project development for shopping centers
in association with Westdeutsche ImmobilienBank. Mr Jahn is re-
sponsible for retail property within the “Rat der Immobilienweis-
en” (Council of Real Estate Experts) of Germany’s Central Real
Estate Association (ZIA) and advises HypZert on retail matters.
This is an extract from the more extensive GfK German-language
white paper “Online versus Stationär? Lieber Komplementär!” (On-
line versus offline retailing – together is better!). You can down-
load this at http://bit.ly/GfKJahnWP2013
ABOUT THE AUTHOR
3
031

CLAUS-MATTHIAS BÖGE,
Executive Board Spokesman,
Deutsche EuroShop
“We found a nice picture for our
entranceway und indulged ourselves.
It’s called “On the Beach” and it just
radiates good energy. I look forward to
seeing it every single day!”
PATRICK KISS,
Head of Investor &
Public Relations,
Deutsche EuroShop
“In 2013, I wanted to change some-
thing about my “look” – literally:
with two new pairs of glasses (read-
ing glasses and sunglasses). The
optician’s in the shopping center
offered advice, measurement and
adjustment. The glasses were com-
parable with online offers in terms
of price but you only get that extra
bit of service offline.”
OLAF BORKERS,
Member of the Executive
Board, Deutsche EuroShop
“An awning for the terrace. Our old one
was already 30 years old and its age
showed even though it was still in great
technical shape! The new awn-
ing has a lot more to offer – spot
lights, side section, completely
electrically operated – hopefully
it will last the next 30 years.”
What I bought
in 2013
032

BIRGIT SCHÄFER,
Secretary to the
Executive Board,
Deutsche EuroShop
“I added to my crockery collection and
bought a six-piece dinner service.
Simple, elegant and white. A purchase
that has made me very happy.”
NICOLAS LISSNER,
Manager Investor & Public
Relations, Deutsche EuroShop
“Buy me a Pie! With this app, I always have
my grocery list on my iPhone. And the app
syncs with my girlfriend’s phone which is
really practical. I can update the list or check
items off at any time.”
KIRSTEN KAISER,
Head of Accounting,
Deutsche EuroShop
“I bought a new rug for my
bathroom: it looks great and
is also made of an extremely
unusual material: paper.”
A
033

MANUEL JAHN,
Head of Consulting,
GfK GeoMarketing
“A fixie single-speed from a Dusseldorf-based bike manufacturer.
For weeks, I scoured bike shops in Hamburg looking for a bike
shop that could create a bike based on my specs. The only re-
sponse I heard was no. I had always been a committed offline
customer but now I was thrust into the maelstrom of the World
Wide Web against my will. A well-designed website and a clever
bike configurator quickly made my wish come true. A brief dis-
cussion among my network of friends – and the click to place to
order was just a minor detail. Am I just another grave-digger
contributing to the death of the retail store? No way. But I am con-
vinced that competition stimulates business! Instead of DHL,
I set off from Hamburg to Dusseldorf to take my pride and joy
into possession in person in the workshop. Incidentally, the visit
to the manufacturer was a true shopping experience: all-in-one
workroom, shop and gallery. I took the opportunity to buy handle-
bars for my second bike on the spot.”
ROLF BÜRKL,
Senior Research Consultant
Business & Technology, GfK
“At the end of last year, I bought trainers
rumoured to work miracles from a sport-
ing goods manufacturer in Herzogen-
aurach. Apparently they make you faster
and you don’t tire out as quickly. These
shoes should help me come in under the
four-hour limit at my marathon in Vienna
in April.”
RAIMUND ELLROTT,
Member of the Management Board,
GMA Gesellschaft für Markt- und Absatzforschung
“One of the best experiences of 2013 was the Bruce Springsteen
concert in the AWD Arena in Hannover at the end of May 2013
which I had bought tickets for together with friends. A 3½ hour
concert, great songs and a lead singer who shows impressive
stamina at the age of 64.”
034

DIRK RIEDEL,
Project Manager,
GMA Gesellschaft für Markt-
und Absatzforschung
“I bought myself new hiking shoes.
Shortly before my holidays, I was able
to choose the right shoes with the help
of an intensive stress test on imitation
terrain in the flagship store of a leading
outdoor retailer. Try that on the Internet!
Since then, they have carried me com-
fortably and reliably through Cinque
Terre and to the top of Etna in Italy,
from hut to hut in Austria and through
the jungle in Costa Rica.”
RAHEL WILLHARDT,
Freelance Journalist
“My purchase of the year was in the or-
ganic supermarket Temma. Instead of
just scanning my groceries, the cashier
commented on every item that he put
through the till with a cheery sing-song
voice. I headed home not only with
healthy food but also a big smile.”
DR. STEPHANIE RUMPFF,
Senior Manager Retail & Consumer,
PwC
My purchase of the year was an iPad which has since
become one of my most important everyday compan-
ions. This companion gives me flexibility: I can read the
newspaper “hot off the press” in the evening, write e-mails
on the train and watch my crime series on Wednesday.
And it gives me moments of true happiness: Berlin jazz
radio in the Rhineland and close contact with my chil-
dren on every trip thanks to FaceTime.”
035

036

Online sales are the driving force
behind Germany’s retail sector. E-
commerce revenues posted double-
digit growth for the third year in a row, at 12%,
in 2013, while the Handelsverband
Deutschland (HDE – German Retail Associa-
tion) is forecasting an even higher 17% for
2014. One key influencer of and a clear win-
ner from this trend is Amazon. This pure play-
er from the US, which commands nearly 24%
of Germany’s e-commerce market, generated
more than 20% revenue growth in 2013, con-
siderably outstripping market growth as a
whole. Amazon has mastered the ins and
outs of digitalisation like no other retailer:
customer analytics, agile technology and ef-
ficient processes offer customers an easy,
convenient and personalised shopping expe-
rience – from a home PC today or a smart-
phone tomorrow, wherever and whenever
they choose.
Stores
are surviving
customers value bricks and mortar
businesses even in the digital shopping age
Our latest survey of German online
shoppers has revealed that con-
sumers already shop online more
frequently than they go to bricks and mortar
stores: 73% purchase products online via
their home computer at least once a month,
compared with 69% in a store. Across all sec-
tors, 41% of online shoppers prefer to make
their purchases only via web shops whereas
39% prefer to shop in physical stores. While
nearly a quarter of the world’s consumers are
already utilising multiple channels when
shopping, the percentage of multi-channel
shoppers in Germany is still much lower: 15%
(+2 percentage points versus 2012) prepare
their purchases online and then go to a store
to buy or collect their selected products. Just
2% go to a store first and then buy a product
online. A clear majority of consumers prefer
the internet for purchases of books, music,
films and video games (78%), consumer elec-
tronics (61%) and toys (53%).
O
1
www.einzelhandel.de/index.php/presse/zahlenfaktengrafiken/internetunde-commerce/item/110185-e-commerce-umsaetze.html
2
www.sec.gov/Archives/edgar/data/1018724/000101872414000006/amzn-20131231x10k.htm
3
For PwC’s survey “Total Retail – How multi-channel consumption is changing the retail business model of tomorrow”,
a representative sample of 1,005 German online shoppers were questioned in July and August 2013 in online interviews.
037
P

A
A
A
A
A Other
In-store research/
online purchase
Online research/in-
store purchase
Online only
In-store only
Furniture and
household goods
DIY/home
improvement
Toys
Average
Electronics
Electrical
appliances
Books, music, ﬁlms
and video games
Sports equipment/
outdoor
Multi-channel shopping behaviour –
from research to purchases (in %)
The considerable online penetration in indi-
vidual sectors is not necessarily a death sen-
tence for bricks and mortar stores, however.
Physical stores have their place even in the
digital world – or maybe even especially in the
digital world. The majority of consumers vis-
it shops mainly to buy everyday products,
such as food, toiletries and cosmetics, DIY
supplies and household goods. However,
physical shopping also chimes into the emo-
tive side of shopping: the opportunity to see,
touch and try on products or to make sponta-
neous purchases. Aspects such as these mean that the attraction of
the experience of shopping in city centers and flourishing centrally
located shopping centers will not diminish. Stores of the future will
look different, however, and will serve a new function: they will have
smaller sales floors and product ranges and become one of many
points of customer contact in an integrated multi-channel business
model. Physical stores can act as interactive experiences and show-
rooms or as pick-up points for products ordered online – or indeed
both at once. What is important is that they meet the expectations of
digital consumers, who have almost unlimited information and shop-
ping opportunities at their fingertips via their smartphones.
Food and
drink
Healthcare
and beauty
(cosmetics)
Jewellery
and watchesClothing and
footwear
16
61
20
2
1
27
36
48
39
42
30
54
39
73
54
12
43
43
27
41 36
53
26 41
11
28
78
22 14 19 14 15 10 15 151314
7
5 3 5 4 4 3 3 33 21
2 4 2 2 2 3 32 212
038

NB: These figures relate exclusively to a defined list of
German retailers (not including online-only retailers).
n=1.005 (2013)/1.003 (2012)
Number of retailers
used in the
last 12 months
Amazingly enough, digital consumers only
use a fraction of the wide range of possibili-
ties at their disposal. Our survey reveals that
German online shoppers tend to spend their
money at an extremely small group of multi-
channel providers: over half of those sur-
veyed (53%) had shopped with no more than
five online retailers in the past 12 months. This represents a consid-
erable year-on-year increase of 10 percentage points. If we narrow
our focus to true multi-channel shoppers, defined as those consum-
ers who use at least two shopping channels4
when making purchases,
this selectiveness becomes even more pronounced: 53% only make
purchases with one single retailer (+9 percentage points versus 2012),
another 45% with two to five providers (+4 percentage points).
45
40
35
30
25
20
15
10
5
0
11 to 20 21 or more6 to 102 to 15Only one retailer
A 2013
2012
13
40
33
13
0
8
35
37
18
0
Physical stores can act as interactive experiences
and showrooms or as pick-up points for products
ordered online – or indeed both at once.
4
Shopping channels are store, online with PC or tablet computer, online with mobile phone/smartphone.
039

Price was by no means the sole determining factor in consumers’
selection of online retailers. Rather, retailers can escape price com-
petition and set themselves apart from their competitors by offering
a broader, more diverse range of products than consumers can find
elsewhere. One aspect that is nearly as important to them is that the
products can be delivered at any time or are in stock at the physical
stores. In addition, since confidence in retailers also plays a key role
in customer loyalty, investments made by those retailers in brand
strengthening and differentiation pay off every bit as much as they do
for brand manufacturers.
Bricks and mortar stores remain a key factor in customer retention.
If a favourite retailer were to close its nearest store, around half of
German consumers would decide to shop in another of the retailer’s
stores: 58% would shop at their favourite retailer’s next-nearest phys-
ical store and 46% would find an alternative retailer selling similar
products. Only just over a third of consumers (37%) would shift their
shopping activity to their favourite retailer’s online store.
An international comparison reveals that German online shoppers are
less loyal to their favourite retailers across different shopping chan-
nels. Average global consumers are more likely to switch to their fa-
vourite retailer’s online store (44%) than to another retailer’s physical
store (42%). While shopping with their favourite retailer is a key factor
for international consumers, German consumers place greater value
on shopping in a physical store. This can certainly be attributed in part
to the dense store network in Germany, which generally makes it easy
to find another location, but the finding also reveals that the online
stores of German consumers’ favourite retailers are currently less
attractive than their physical counterparts.
This means that German retailers need to keep working on develop-
ing both their brands and their products and services across all sales
channels and to make these attractive to customers. The future
belongs to multi-channel retailing, and almost all retailers need to
operate both offline and online, and to do so actively. An individual on-
line shop is not necessarily a must for smaller retailers if marketing
and distribution can take place just as successfully through a coop-
eration partner or marketplaces like Amazon or eBay. If retailers close
a bricks and mortar store and can succeed in motivating fickle cus-
tomers to shop at their online shop, they need not fear customers
shifting to their rivals.
An integrated, customer-centric business model (“total retail”) is es-
sential for successfully generating customer loyalty in the retail busi-
ness. This calls not only for an integrated sales structure and culture,
but also for technological agility and a customer-oriented supply chain,
to give consumers compelling access to the retailer’s shopping expe-
rience across all contact points and end-devices.
What would you do if your favourite retailer closed
its nearest physical store? (in %)
I would find my favourite retailer’s next-nearest
physical store and go there
I would find an alternative retailer’s local store
selling similar products
I would order (more) from my favourite retailer’s website
I would find an alternative online retailer’s website
selling similar products
I would generally spend less on this type of product
I would go onto social media and join the discussion
about the store closure
n=977
0 10 20 30 40 50 60
58
46
37
18
9
4
By Gerd Bovensiepen, Head
of the Competence Center
Retail & Consumer, Germany
and Europe at PricewaterhouseCoopers AG, and Dr Stephanie Rumpff,
Senior Manager, Retail & Consumer at PricewaterhouseCoopers
Dr. Stephanie Rumpff
Tel.: +49 (0)211981-2118
stephanie.rumpff@de.pwc.com
Gerd Bovensiepen
Tel.: +49 (0)211981-2939
g.bovensiepen@de.pwc.com
ABOUT THE AUTHORS
040

This Kama Sutra of shopping is essentially a
relationship manual. It sheds an intimate light
on the relationship between shopper and mer-
chandise. There are resolutions to anything
that could stand in the way of a happy union
between the two. The book contains ten golden
rules for successful shopping, tips on getting
the necessary cash and decision-making aids
for wavering shoppers.
GUIDO MARIA KRETSCHMER
Attraction
Style has nothing to do with size
PRIZE DRAW:
For your chance to win a copy of “Das Shopping-Kamasutra” (available in German only), just
send an e-mail with the subject line “Buchverlosung” to ir@des.ag by 15 July 2014. The win-
ner will be notified in writing and no appeals will be entertained.
COSIMA REIF
The Kama Sutra of shopping
A guide to maximising the pleasure of purchases
80 pages, bound, with extensive
four-colour illustrations
ISBN: 978-3-99300-159-9
Store price: €16.90
237 pages, bound,
50 images
ISBN: 978-3-84190-239-9
Store price: €17.95
Books
on the subject of shopping
This is a long-overdue work, given that over our
lifetimes, each of us will reach into a wallet or
purse some 500,000 times to make a purchase.
Often we do this not of our own volition, but be-
cause we have been manipulated into it. That
is why the heady rush that comes with shop-
ping can often turn into a hangover, replete with
the accompanying headache. The Kama Sutra
of shopping offers emancipation from mindless
consumption and the pressure to buy and in-
stead celebrates taboo-free shopping with the
aim of maximising the pleasure derived from
the act. Fun, colourfully illustrated and some-
what tongue-in-cheek at times. On completing
the book readers will be able to congratulate
themselves on a purchase well made!
orders from women who were well-heeled but
had exactly the same problem areas as the
rest of us.
“Style has nothing to do with standard sizes,”
says Kretschmer whose book “Anziehungs-
kraft” (or “Attraction” in English) describes ten
typical shapes. Each has its little weaknesses
but also its assets, and the trick is maximise
these. This book advises on how to achieve this
and also includes tales, in the best Kretschmer
tradition, of his experiences with “elf”, “meer-
kat” and “Valkyrie” types.
Fashion designer Guido Maria Kretschmer has
dressed countless stars and models with
dream figures. But that has not always been
the case. Right from the early days of his own
fashion label, Kretschmer would take private
041

Charts
2013
042

Top 5
blu-ray discs
(23.12.2013)
1
Lone Ranger
2
Pacific Rim
3
X-Men Origins: Wolverine
4
Despicable Me 2
5
The Smurfs 2
Bestsellers fiction
1
Jojo Moyes Me Before You
2
E. L. James Shades of Grey 01
3
Jonas Jonasson
The 100-Year Old Man Who Climbed
Out of the Window and Disappeared
4
5
Top 5 classical music
(December 2013)
1
Jonas Kaufmann:
The Verdi Album
2
David Garrett:
Garrett vs. Paganini
3
Anne-Sophie Mutter: Dvořak
4
Luciano Pavarotti:
50 Greatest Tracks
5
Jonas Kaufmann: Verdi Requiem
Top 5 audio CDs
(December 2013)
1
Jojo Moyes: The Last Letter From
Your Lover
2
Jonas Jonasson: The Girl Who Saved The
King of Sweden
3
Robert Galbraith alias J.K. Rowling:
The Cuckoo’s Calling
4
Suzanne Collins: The Hunger Games –
Catching Fire
5
Rachel Joyce: Perfect
Top 5 music albums
(20.12.2013–09.01.2014)
1
Robbie Williams Swings Both Ways
2
Helene Fischer Farbenspiel
(“Interplay of Colours”)
3
Max Herre
MTV Unplugged – Kahedi Radio Show
4
Helene Fischer Best of
5
Santiano Bis ans Ende der Welt
(“To the Ends of the Earth“)
(Second Edition)
presented by
presented by
presented by
Bestsellers
non-fiction
1
Guido M. Kretschmer
Anziehungskraft (“Attraction“)
2
Florian Illies 1913
3
Rolf Dobelli The Art of Thinking Clearly
4
Randi Crott Erzähl es niemandem!
(“Tell No One!“)
5
Jamie Oliver Jamie’s 15-Minute Meals
043

RETAIL WITHOUT BOUND-
ARIES AND SHOPPING
CENTERS
OUTLOOK OF RETAIL
PROPERTY IN THE
E-COMMERCE AGE
AHere are three
core arguments
Shopping centers in Germany are enjoying
unbridled demand – both from investors as
a home for their money and from tenants as
retail locations. However, the boom in online
retailing is also producing considerable
uncertainty over bricks and mortar retail-
ing. How will online retailing evolve? Which
locations will lose out, and might there also
be some winners? And what will this mean
for the model of the shopping center, often a
town or city’s no. 1 retail destination? Will it
be able to counter the threat from these new
ways of shopping, or even be able to capital-
ise on them for its own ends?
044

all under one roof
045

1
Online retailing is and will remain the overwhelming megatrend dom-
inating site development in retail. There is no disputing that the shrink-
ing market share of physical retail could have a neg-ative impact on
real estate and city centers. But what will the drivers behind this pro-
cess be, and where will the limits lie? The rise in the market share of
online retail is also being support-ed by technological developments
and the popularity of smartphones. Whereas just under 6 million
smartphones and tablet PCs were sold in Germany in 2009, the equiv-
alent figure for 2012 was already over 20 million, with higher-perfor-
mance devices and faster internet connec-tions boosting the appeal
of mobile commerce even further. Physical retailers might not be able
to prevent customers from taking advantage of in-store advice only
to make their pur-chase online in the end, sometimes even while still
in the store thanks to increasingly powerful mobile devices. Offline
retailers need not yet fear their shops are becoming nothing more
than showrooms, however. A Roland Berger/ECE study showed that
sales volumes for which the groundwork is done online and the trans-
actions take place in a physical store are ten times higher than in the
reverse scenario.
Nevertheless, it would not do to rely on this figure staying that way: it
is expected that offline retailers will in future be used increasingly as
sources of information, on which basis a transact tion will ultimately
be made via an online channel. The market share of e-commerce
is current-ly just under 10%, and forecasts suggest that this could
double by 2020, although it will vary between different areas of retail.
In light of the synergies available between online and offline business,
existing pure players (e.g. eBay, Zalando, myMüsli, etc.) will look to
create new physical models, generating demand for properties in
prime, well-established locations, i.e. well-situated shopping centers.
The main growth drivers behind online retailing are goods that con-
sumers do not need to see, touch, try on or smell in order to test the
quality. That is why online sellers of products such as appliances, con-
sumer electronics and media devices (17%) have grown their market
share in recent years, as have online book retailers (23%), although
distance sales of books actually dipped slightly in 2013 for the first
ARGUMENT 1:
Online retailing
will continue to
grow at pace, but
not all sectors
will be equally
affected
time since the dawn of e-commerce. The fashion segment was whol-
ly unaffected by e-commerce, and saw an 11% jump in online sales
between 2011 and 2012. The market shares for products such as
watches/jewellery and medication are still low, and in fact declining.
Even food is proving surprisingly resistant to online distribution, de-
spite viable attempts on the market by national chains. A Lührmann
study (Retail Trend Ba-rometer 2014), which surveyed 2,200 execu-
tives with responsibility for expansion at interna-tionally, nationally
and regionally active companies, suggests that that will remain the
case. In this environment, total offline retail sales are also holding
steady and there is high consistency of demand, in part because Ger-
many has survived the financial crisis relatively unscathed. That is
one reason why the German market is continuing to attract a great
deal of interest from foreign investors.
Click & Collect:
Customers go online for
information, order online ...
046

3
ARGUMENT 3:
However, investment
security takes top
priority. In the wake
of the financial crisis,
online retail-ing has
been another factor
pushing investors to-
wards risk aversion
and a greater focus
on core/core plus real estate, with the result that high street proper-
ties in prime locations have come into the spotlight more than ever,
with prices rising accordingly. Similarly, well-positioned shopping
centers will continue to operate with a fairly low degree of cyclicality,
whereas weak retail locations will lose out, in part because national
and international retailers will cease to need blanket coverage in the
long term due to the rise of online shopping and will be able to thin
out their store networks. The expectation is that retail properties in
large and medium-sized cities will have better market prospects in
future than those in smaller towns or in class C or D locations. At pre-
sent, only the scarce supply of available properties is acting as a brake
on investment transaction volumes in German shopping centers
(2012: approx. €3 billion). The high demand for good centers natural-
ly has implications for yields, with peak yields remaining stable at
around 5%.
The competition against e-commerce will
force bricks and mortar retailers, and even
shopping centers that are currently operating
well, to keep up with the times. In so doing, it
is less helpful to attempt to lure in customers
and try to “train” them by demonstrating the
benefits of physical retailing than it is to ad-
dress the “modern consumer” via a good multi-
channel strategy, gener-ating revenues from
cross-selling by linking together attractive
online and offline forms of dis-tribution. Phys-
ical retail needs to make clear what sets it
apart from online sellers and cannot be rep-
licated. For shopping centers, that means con-
centrating even more squarely on shopping
as an experience. That means a new genera-
tion of shopping centers that engage the senses
of hearing, touch and smell as well as sight
(such as the Mönchengladbach Arcaden), along
The shopping
experience and
adaptability of
shopping centers
will become
increasingly
important
with those making the shopping experience
more interactive (such as the Alterstal center
in Hamburg and Limbecker Platz in Essen,
offering “Future Labs” with 3D orientation sys-
tems and virtual customer information) will be
in a stronger position.
Shopping centers must strive for the status
of “third place”, after the home and the work-
place, for the catchment areas that they serve.
Not only critical mass, but above all a mix of
sectors appropriate to the location and the
market are central to achieving this. As ex-
plained above, there are increasing shifts tak-
ing place in the segment mix and product con-
cepts on offer in shopping centers in the
e-commerce age. The following chart pro-
vides an illustration of this.
ARGUMENT 2:
pu
w
anan
real estate, with the result thate result that
ons have come into the spotligo the spotlig
accordingly. Similarly, well-poaccordingly. Similarly, well-po
ue to operate with a fairly low due to operate with a fairly low d
ail locations will lose out, in parail locations will lose out, in par
etailers will cease to need blanetailers will cease to need blan
he rise of online shopping andhe rise of onl
works. The expectation is thatworks. The e
-sized cities will have better m-sized cities will have better m
n smaller towns or in class C orn smaller towns or in class C or
e supply of available propertiese supply of available properties
Well-situated
retail locations
need not be afraid
... and pick the product up in
a local shop.
047

Sector
Typical space in %
(as range)
Expected
future trend
Food and consumables 7–14
Healthcare, beauty 7–11
Flowers, pet supplies 1–2
Books, stationery and toys 8–12
Clothing, footwear, sport 48–60
Electrical appliances 16–20
Household, furniture, furnishings 5–7
DIY, construction and garden supplies –
Glasses, watches, jewellery 1–2
Other retail –
GMA presentation. Basis: numerous expert discussions/evaluation of center structures
Plus services: 1–2% and catering outlets: 6–7%
Typical sector breakdown within shopping
centers in % and expected future trend
The ability of retail property to respond to
market trends and changes will be critically
important in future. A high degree of flexibil-
ity in rental space, particularly with regard to
the arrangement of space and product struc-
tures, will therefore be more crucial than ever
for the long-term success of shopping cent-
ers. Those centers that fail to adapt adequate-
ly to the dynamic shifts in retail and consum-
er behaviour will find the going much tougher.
Pressure to renovate and re-fresh will in-
crease substantially, in part because the life-
cycle of shop concepts will shorten consider-
ably. Sonae Sierra / GMA studies from
2010/2011 already indicated that the market
volume for shopping center renovations in
Germany alone was running at €2.5 to €3.5
billion.
Mastering the full gamut of multi-channel
selling possibilities, from bricks and mortar
stores to online sales via PCs, smartphones
and tablets, is the ultimate challenge facing
the retail industry. However, distance selling
cannot be expected to completely supplant
physical stores. Well-located shopping cent-
ers in good locations and physical retailers
with sustainable models in good locations will
in the authors’ view continue to operate prof-
itably in the market. Flexibility and the ability
to adapt to fast-changing operating and prod-
uct range concepts will be the key challenges
for the future.
ABOUT THE AUTHORS
D
D
C
C
C
A
A
A
A
A
Raimund Ellrott
GMA Gesellschaft für Markt- und Absatzforschung mbH
Dirk Riedel
048

the end of the crisis?
Consumer
spending in 2014
GfK forecasts suggest that private household spending in Germany is set to
increase by 1.5% in real terms in 2014. The organisation expects increases
of between 0.5% and 1.0% for the European Union as a whole. This means
that private consumer spending in Germany is forecast to grow much more
strongly than last year, providing sustained support to the domestic economy.
GfK is predicting significant rises in food and drink sales, whereas other
areas of retail are expected to enjoy only modest growth.
049

German consumers are of the opinion that the repercus-
sions of the financial crisis are over, at least in their own
country, and that the economy will continue to perform
well over the next 12 months. This view is in line with fore-
casts by economic research institutions and businesses.
The economic upturn promises a continuation of good
prospects for the German labour market. Consumers’
hopes are therefore high that this will feed through into
wages. In light of the general economic situation, consum-
ers believe that the time is right to make larger purchas-
es. Interest rates on both deposits and loans are at very
low levels, with the result that propensity to save is at a
historical low. The tourism industry is also benefiting from
the upbeat consumer sentiment, with spending on holi-
days and private travel rising by 8%, or roughly €5.9 bil-
lion, last year.
Positive, though less dramatic,
trend in online sales
Divergent trends are in play within German retail. Food
and drink retailers and chemists recorded 2.7% sales
growth in 2013, mainly thanks to higher prices. Consum-
ers are prepared to pay more for quality and service. How-
ever, volumes sold decreased again, by 0.5%. Sales in non-
food retail, which includes textiles, electronic devices,
furniture and home improvement products, increased by
just 0.2% in 2013 to a little under €151 billion. Online sales
performed well, albeit not as dramatically as in previous
years, up 8%. There was a correspondingly negative im-
pact on physical retail.
Price rises are expected to soften again in 2014. The Eu-
ropean financial crisis is not yet entirely over, and so Ger-
man consumers are once again unlikely to substantially
change their purchasing habits this year. For 2014, GfK is
forecasting nominal sales growth of 2.3% for food retail-
ers and chemists, while volumes are expected to continue
to fall. Non-food retail sales are predicted to grow by 0.6%.
Stable labour market is an indispensable
ingredient in consumer confidence
The most important contributor to positive consumer sen-
timent is the labour market. According to the country’s
Federal Employment Agency, an average of 2.95 million
people were registered as unemployed in Germany across
2013, corresponding to an unemployment rate of 6.9%.
A comparison with Germany’s European neighbours con-
firms how strong these figures are. Germany is in fact the
only country in which the number of people out of work
has dropped since the pre-crisis 2007 level, and by an im-
pressive 37%. By contrast, unemployment rates have dou-
bled or tripled in crisis-struck Greece, Spain and Ireland.
The economic outlook around the world, and most notably
in Europe, has brightened for the first time in years. Even
though the recovery remains very soft, German exports
were up by 3% last year. An increase of 4% is forecast for
2014. Exports to other EU countries are also predicted to
rise again. The European Commission forecasts that Ger-
man GDP will increase by 1.7% this year, from 0.4% in
2013. Germany should not be alone in enjoying renewed
economic strength either: the Commission expects Europe
to grow by an average of 1.4%, after stagnating last year.
European consumers also share this optimism.
G
050

However, it will take at least into 2015 for economic
growth to translate into a labour market recovery, as is
borne out by propensity to buy in Europe. Consumer sen-
timent significantly improved in some areas between the
fourth quarters of 2012 and 2013, but propensity to con-
sume is still well below average in Europe. Only when
companies are in a position to
create new jobs, pushing down
unemployment, will consumer
willingness to spend pick up
again. And only then will the peo-
ple of the European Union be in a
position to reinforce the economic
upturn via their consumption.
The consumer climate indicator is signalling that consum-
er spending will go up again in 2014. The GfK is also fore-
casting a real-terms increase in private consumption for
the EU as a whole for
the first time since
2011. This is set to be
between 0.5% and
1.0% and to make a
significant contribu-
tion to higher eco-
nomic growth in Eu-
rope. Private house-
holds in Germany are
also set to spend more: GfK calculations point to a 1.5%
real-terms rise in German consumer spending this year.
10
5
0
-5
German consumer climate
2008 2009 20122010 20132011 2014
Source: GfK | European Commission
Indicator points
Consumer sentiment
significantly improved
in some areas between
the fourth quarters
of 2012 and 2013.
Rolf Bürkl, Senior Research
Consultant, Financial Services,
GfK. Mr Bürkl’s responsibilities
include the regular production
of and commentary on the GfK
consumer climate indicator.
A lively start to 2014
for the consumer climate indicator
ABOUT THE AUTHOR
051

The mall in the northern extension of the
Main-Taunus-Zentrum opened in late 2011.
Deutsche EuroShop’s
portfolio
DEUTSCHEEUROSHOPANNUALREPORT2013/THECENTERS
052

In 2013, there was again movement in
our portfolio: in May, we managed to
increase our share in the Altmarkt-Galerie
Dresden, one of the most successful
shopping centers on our books, to 100%.
In August, we disposed of our investment in
the Galeria Dominikanska in Wroclaw/
Poland, in which we had previously held a
one-third stake. As a result, our portfolio
now comprises 19 properties: 16 centers in
Germany and one each in Poland, Austria
and Hungary. These offer an area of
927,500 m² for a total of 2,350 shops.
These properties offer customers a welcome change
from shopping in the city and they each have a reputation
that extends well beyond the region.
Right from the beginning, our focus in any investment pro-
cess is on the transport links for the center in question: in
city centres, we seek out locations close to local public
transport hubs. These might be central bus stations, which
in Hameln and Passau, for example, are right alongside
our properties. The Herold-Center Norderstedt is built di-
rectly above an underground train station, while a major
bus station with numerous connecting services is located
right in front of the main entrance. What is more, all our
centers have their own parking facilities that offer visitors
convenient and affordable parking, even in city centres,
thereby ensuring good accessibility by car. Our out-of-
town properties offer a large number of free parking
spaces. These particular locations are alongside motor-
ways, making them very easy to reach, like the Rhein-
Neckar-Zentrum by the Viernheimer Kreuz junction. Park-
ing spaces reserved for women and the disabled are
offered as part of the service at all our shopping centers.
At 91%, the focus of our invest-
ment activity clearly lies in Ger-
many. As in previous years, we
are particularly proud of our con-
sistently high average occupancy
rate of 99%, which is testament
to the quality of our portfolio.
Location, location, location
In real estate, and particularly in retail, loca-
tion has always played a pivotal role. Our ten-
ants want to be wherever their customers
are. Each of our 19 shopping centers repre-
sents a prime location: the majority of our
properties are in city centres, in places where
people have been coming together for centu-
ries to ply their trades. Often our centers are
immediately adjacent to local pedestrian
zones. Our portfolio also includes shopping
centers in established out-of-town locations.
The bus station in Norderstedt is
integrated into the Herold-Center
for customers’ convenience.
A
Domestic International Total
No. of centers 16 3 19
Leasable space in m² 806,700 120,800 927,500
No. of shops 1,910 443 2,353
Occupancy rate* 99% 99% 99%
Inhabitants in catchment
area in millions 13.4 2.5 15.9
* including office space
053

Collective strength
The tenant structure at each of our 19 properties is the
result of a permanent and intensive process that is
geared towards meaningfully complementing the offering
of the city centre in question. Our goal is always to work
with traders in the neighbourhood to make the entire lo-
cation more attractive so that everyone can benefit from
the increased appeal of the city centre as a whole. Our
centers often play an active role in the marketing and
management of the city concerned, both financially and
from the perspective of creative and personnel input. We
are always keen to work with others in a spirit of fairness
and partnership.
Intelligent architecture
When we are designing our locations, one factor that al-
ways receives special attention is the architecture: spe-
cific plot requirements are just as important as the func-
tional needs of our tenants. We also have a responsibility
to the city that we are keen to fulfil. The shopping centers
should blend in with their surroundings as much as pos-
sible, while also having an exterior that meets the re-
quirements of modern architecture. We work on this very
closely with the relevant local authorities. The outcome is
often an architectural gem, where even historical build-
ings can be carefully integrated into the center if possible,
as is the case, for example, with the listed Kreishaus
building, which is part of the Stadt-Galerie in Hameln.
Our shopping centers need to be especially impressive
inside, first and foremost so that visitors, customers and
employees enjoy spending time there and find them a
pleasant place to be. To achieve this, we adopt a simple
and timeless architecture that makes use of premium and sustainable
materials. Quiet rest areas and fountains invite people to take a mo-
ment to relax, innovative lighting concepts create the right atmos-
phere in the mall to suit the time of day, and state-of-the-art climate
control technology provides a pleasant tempera-
ture all year round. Everything is designed to
make each visitor feel good and want to keep
coming back. Ongoing maintenance, modernisa-
tion and optimisation also ensure that our cent-
ers remain competitive and retain their value.
It goes without saying that we design our prop-
erties to suit all generations and that every
visitor should feel they are in good hands, no
matter what their age. Thanks to wide avenues,
escalators and lifts, it is possible to reach every
corner of the center without too much effort,
even with a pushchair or wheelchair. There are
play areas for our smallest visitors, where
shoppers can enjoy some time out. Massage
chairs are available for customers to use in the
mall for a small fee, providing relaxation as a
break from shopping.
054

Environmentally friendly
energy supply
We are proud of the fact that all our
German centers have been operating
on certified green electricity since 2011. We are planning
to switch our foreign properties to energy from renewable
sources over the next few years. It is also our goal to con-
tinuously reduce the overall energy consumption of our
properties and in so doing to cut CO2 emissions. To
achieve this aim, we are using ultramodern technologies,
such as heat exchangers and environmentally friendly
lighting systems. We are also conducting ongoing
discussions with our tenants aimed at reducing energy
consumption in the individual shops as well.
Securing the future through
flexibility
Retail has always involved change. In recent years, in par-
ticular, increasing numbers of retailers have been enquir-
ing about the possibility of expanding their premises, so
they can convert the shop from purely a retail area into
an experience arena. For instance, retailers are increas-
ingly allowing customers to take the time to try out and
experience the product at length before buying. A further
trend is the tendency towards more in-depth consulta-
tions. The role these factors play is growing steadily,
particularly in this age of increasing online shopping.
We are able to provide customised solutions to meet the demand for
ever more varied spaces: in our centers we try to provide all tenants
with the exact floor plan they need to realise their concepts. And it is
important that we are also able to be flexible here as the years go by.
It is possible, as a rule, to adapt virtually any retail space, making it
bigger or smaller, without major effort or expense by shifting the
internal walls. Reducing a larger retail space, for example, creates a
chance to integrate a new concept into the shopping center or to
enable another retailer to expand. It may also make sense to help the
tenant look for a new shop area elsewhere in the center.
This flexibility is one of the main distinctions between our concept
and the traditional shopping street with its rigid floor plans that have
to be put up with the way they are. It is often the case that certain re-
tailers wait until they have been offered space in a shopping center
before entering the market in a city simply because of a lack of suit-
able spaces for them elsewhere in the city. The whole of the retail
sector in the city centre ultimately benefits from the resulting addi-
tion to the offering.
Above: The Stadt-Galerie in Hameln is located in the heart
of the city and conveniently connected to the pedestrian.
Left side: The food court in the Galeria Baltycka. Names of
Hanseatic cities adorn the walls.
Below: Shop designs and product presentation are becoming
increasingly important.
Above: Play area for children at the Stadt-Galerie in Passau.
055

170 million visitors a year
The catchment areas around our centers are home to
nearly 16 million people, over 13 million of whom in
Germany. This gives us access in theory to 16% of the
German population – one in six people. A location’s catch-
ment area is a major factor for us when it comes to se-
lecting a property for our portfolio: this is ascertained sci-
entifically on an annual basis according to standardised
rules for all shopping centers and represents the number
of potential customers for the location in question. In
2013 we welcomed a total of around 170 million visitors
to our 19 properties.
Our largest tenants
With a share of 5.6%, the Metro Group is our biggest ten-
ant. It is one of the most important international retailers
and is represented in a large number of our centers by
its retail brands Media Markt and Saturn (consumer
electronics), Real-SB-Warenhaus and Galeria Kaufhof
Warenhaus. Behind this in second place is the Douglas
Group, one of Europe’s leading retailers, which, with its
divisions Douglas perfumeries, Thalia bookshops, Christ
jewellery shops, AppelrathCüpper fashion stores and
Hussel confectioners, is a tenant of our centers and has
a share of 4.5% in our overall rental volume (as at 31 De-
cember 2013).
Our rental contract portfolio is
highly diversified: our
top 10 tenants are responsible
for a quarter of our rental
income, which shows that there
is no major dependency on indi-
vidual tenants.
Metro Group
5.6
Deichmann
1.9
Douglas Gruppe
4.5
REWE
1.6
H&M
3.2
Inditex Group
1.5
New Yorker
2.3
C&A
1.5
Peek&Cloppenburg
2.1
Esprit
1.4
THE TEN LARGEST TENANTS SHARE OF RENTAL INCOME IN %
As at: 31 December 2013
TOTAL OF TOP 10 TENANTS
25.6%
Other tenants
74.4
The fountain in the Rhein-Neckar-Zentrum:
a popular meeting point.
056

Long-term rental contracts
The rental contracts that we sign with our tenants tend to
have a standard term of ten years. As at 31 December
2013 the weighted residual term of the rental contracts
in our portfolio was almost seven years, with 61% of our
rental contracts being secured until at least 2019.
External center management
Management of our 19 shopping centers has been out-
sourced to our partner ECE Projektmanagement.
ECE has been developing, planning, implementing, rent-
ing out and managing shopping centers since 1965. With
189 facilities currently under its management, the com-
pany is Europe’s leader in the area of shopping malls.
Deutsche EuroShop benefits from this experience both
within Germany and abroad. Thanks to our streamlined
structure, we are therefore able to focus on our core busi-
ness and competence, portfolio management.
Rent optimisation rather than maximisation
One of the core tasks of center management is putting together the
right combination of shops to suit the property and the local area. This
mix of tenants and sectors is tailored perfectly to the location in each
case and is constantly refined. It is the result of a precise analysis of
the local retail sector.
Center management is also about identifying the wishes and needs of
customers. We always create space in our centers for retailers from
sectors that, on account of current rental costs in prime locations, can
scarcely be found in city centres anymore, such as toy and porcelain
shops. This also enables us to give new businesses and niche con-
cepts an opportunity.
There is one key area in which we set ourselves apart from the ma-
jority of landlords in a pedestrian zone: as long-term investors, it is
our goal to achieve permanent rent optimisation rather than short-
term maximisation. We want to offer our customers and visitors an
attractive mix. Rather than focus on each shop space in isolation, we
look at the property as a whole. The rent in each case is calculated
primarily on the basis of the sales potential of the sector to which the
tenant belongs as well as of its location within the shopping center.
LONG-TERM RENTAL CONTRACTS TERM OF CONTRACTS, SHARE IN %
2014
3 2015
8
2016
8
2017
11
2018
9
2019 ﬀ
61
www.ece.com
057

All sides benefit from this system: as the landlord, we are able to build
a relationship of trust with our tenants for the long term; our tenants
benefit from high visitor numbers achieved due to the varied mix; and
our customers appreciate the very wide choice of shops. These range
from the latest fashion concepts to accessories and health and beauty
retailers, right through to professional services such as bank and post
office branches. There are also various food and drink options for
visitors, with cafés, fast-food restaurants and ice-cream parlours of-
fering satisfying snacks and refreshments to enjoy while shopping.
Diversity among tenants
The fashion industry dominates our retail mix at around 50%. The
fashion expertise of our centers is confirmed time and again in cus-
tomer surveys. It is one reason why customers are willing to travel
sometimes long distances from the surrounding area to enjoy the
wide selection and the quality of the in-store advice.
The individual tenant mix provides each of our centers
with a character all of its own. In our shopping centers,
we always make sure that there is a healthy blend of re-
gional and local traders as well as national and interna-
tional chain stores. This contrasts starkly with the main
shopping streets, where, according to studies in Germany,
chain stores occupy over 90% of the retail space in some
cases. The small-scale structure of our centers offers vis-
itors something different each time and the opportunity
to satisfy the various consumer needs of the whole family.
Famous tenants
Our tenants are a key factor in our success. They include
Aldi, Apple, Bershka, Bijou Brigitte, Breuninger, Burger
King, C&A, Christ, dm-drogerie markt, Deutsche Post,
Deutsche Telekom, Douglas, Esprit, Fielmann, Gerry
Weber, Görtz, H&M, Hollister, Jack&Jones, Media Markt,
Marc O’Polo, New Yorker, Nordsee, Peek & Cloppenburg,
REWE, Saturn, s.Oliver, Subway, Thalia, Timberland,
TK Maxx, Tom Tailor, Tommy Hilfiger,Villeroy & Boch,Vero
Moda, Vodafone, WMF and Zara.
Buying and experiencing
In our centers, visitors can always rely on standard open-
ing hours, unlike in the traditional city centre where each
individual retailer decides for itself when it will be open.
Whether it is an optician or travel agency, fashion company
or electronics retailer, every tenant will be open to visitors
for the center’s full opening hours. This too is a strategic
advantage that is appreciated particularly by customers
who have to come a long way.
RETAIL MIX IN % OF LEASABLE SPACE
Clothing
50
Department
stores
12
Hardware/
electronics
20
Catering
4
Service
providers
2Groceries
7
Health
products
sector
6
058

In the center itself, the focus is always on service. There
are Information Points manned by friendly staff who can
answer any questions about the center. Gift vouchers can
be purchased here, for example, and in many of our cent-
ers there is also the opportunity to hire pushchairs. Cus-
tomers can feel safe at all times thanks to the deployment
of discreet security personnel. Baby changing rooms,
customer toilets and cash machines complete the offer-
ing. It goes without saying that the centers are always
clean.
Every one of our tenants is automatically also a member
of the marketing association of the shopping center in
question. This means that each tenant pays a share of the
center’s marketing costs and can play an active role in the
marketing strategy committee. The marketing associa-
tion plans events together with the center management,
constantly making the shopping center a lively marketplace: fashion
shows, photo and art exhibitions, country-themed weeks and informa-
tion events dealing with a whole range of topics offer visitors new and
fresh experiences time and again. Local associations and municipal au-
thorities are also involved in the plans and are given the opportunity to
represent themselves in the center. The lavish center decorations for
the Easter and Christmas periods are among the projects handled by
the marketing associations.
Another important area of the work is coordinating coherent advertis-
ing activity for the center as a whole as well as editing a center news-
paper, which is distributed as an insert in regional daily newspapers
in the catchment area and provides readers with regular and profes-
sional updates on events and news relating to the center. Radio ads,
adverts on and inside local public transport, and illuminated advertis-
ing posters ensure that the advertising campaigns reach a large au-
dience.
Investment Guidelines
Deutsche EuroShop’s key investment guidelines can be summarised as follows:
NDeutsche EuroShop invests exclusively in shopping centers.
NThe minimum property size is 15,000 m² of which
no more than 15% may be office space or other non-
commercial usage.
NThe locations should feature a catchment area of at least
300,000 inhabitants.
NShopping center projects are only purchased when an
executable construction authorization can be produced
and 40% of the leasable space is secured by long-term
legally binding lease contracts.
NProject developments without the right to build or that
cannot facilitate pre-letting can be taken over as a joint
venture. Project development costs may not exceed
5% in individual cases or 10% in total of the Deutsche
EuroShop equity.
NThe main country of investment is Germany. In the
long-term, investments in the rest of Europe may not
exceed 25% of the total investment volume.
059

060

Activities in
the centers
2013
WILDLIFE AND WOODLAND IN WILDAU
In August 2013, green was, for a while, the
dominant colour in the A10 Center in Wildau/
Berlin. Under the motto of “Fascination of
Woodland – Discovering Nature” customers
were able to discover and get to know the
forest in various scenarios.
The exhibition spaces transformed the cent-
er into various wooded areas, each with a
different emphasis.
Alongside the forest
plantation, wood-
land glade, preda-
tors and voices of
the forest, the topics
also included tree
evolution and for-
estry. Another ex-
hibition space ad-
dressed the eco-
system of the forest.
A forest school invit-
ed people to explore,
educate themselves
and experience. The daily guided tours
proved very popular with school classes and
interested visitors.
A
061

What does a make-up artist actually do?
Where do the costumes that singers and
dancers wear on stage come from? And how
is a stage set created? Answers to these
questions were provided for visitors to the
Altmarkt-Galerie
Dresden in June.
An exhibition took
a detailed look at
the work that goes
on behind the cur-
tain of the neigh-
bouring Semper
Opera House to en-
sure that the sym-
phonies, operas
and ballets succeed in bringing joy and
pleasure. It quite literally provided a peak
“behind the scenes”. Various exhibits, such
as an oversized teapot from the set of the
ballet “Coppélia”, brought
the atmosphere of a stage
production to the mall. Visi-
tors with an interest in the
subject were also able to
learn a lot about the composers Richard
Wagner and Richard Strauss, whose careers
were closely associated with the Dresden
opera house.
THE WORLD OF THE SEMPER OPERA HOUSE IN DRESDEN
For carnival lovers from Mannheim and the
local area, 12 November 2013 was a very
special day: the Freudenheim carnival
society “Lallehaag” presented its new City
Princess in the Rhein-Neckar-Zentrum.
In her “civic life” Jana I. works as a depart-
ment manager for our tenant engelhorn,
and her close connection with her place
of work was also reflected in her title:
“Jana I, Princess of the City of Mannheim and
the Electoral Palatinate from the Rhein-
Neckar-Zentrum” was her name during
her reign.
The programme
in the center in-
cluded autograph
sessions, public
appearances and
children’s dance
competitions at
which donations
were collected
for research into
childhood cancers.
A PRINCESS IN THE RHEIN-NECKAR-ZENTRUM
062

Environment
Climate protection is a top priority for Deutsche
EuroShop. We firmly believe that sustainability and
profitability are not mutually exclusive. Neither are
shopping experience and environmental awareness.
Long-term thinking is part of our strategy, and that
includes a commitment to environmental protection.
In 2013, all our German shopping centers had contracts with suppli-
ers that use renewable energy sources, such as hydroelectric power,
for their electricity needs. The “EnergieVision” organisation certified
the green electricity for our centers in Germany with the renowned
“ok-power” accreditation in 2013. We also plan to switch our centers
in other countries over to green electricity wherever possible within
the next few years.
The German centers used a total of around
67.4 million kWh of green electricity in 2013.
This represented 100% of the electricity
requirements in these shopping centers,
Based on conservative calculations, this
meant a reduction of around 22,500 tonnes
in carbon dioxide emissions, which equates
to the annual CO2 emissions of around 1,020
two-person households. The use of heat
exchangers and energy-saving light bulbs
allows us to further reduce energy con-
sumption in our shopping centers.
Deutsche EuroShop also supports a diverse
range of local and regional activities that
take place in our shopping centers in the
areas of the environment, society and the
economy.
30,000
25,000
20,000
15,000
10,000
5,000
0
2008 2009 2010 2011 2012 2013
CO2 savings were down slightly in 2013 because the centers
consumed less electricity overall, the EEG share rose from
24.0% to 29.4% and the electricity’s CO2 emission factor fell
from 0.491kg/kWh to 0.474kg/kWh. Those are all positive
developments for our environment.
Reduction in CO2 emissions
Tonnes
C
063

Douglas has operated attractive
perfumeries in the shopping cent-
ers of Deutsche EuroShop for
many years. One aspect which
has always been important to
Douglas is ensuring that the on-
line shop and stores are not “ei-
ther/or” solutions, rather that the
products and services they offer
complement each other perfectly.
Perfumeries are and always will
be the customer’s first stop when
looking for sensual experiences
and scents, body care products
and decorative cosmetics to make
a personal impression. For even
in the future, the Internet will nev-
er be able to completely simulate
or replace a trip to a perfumery.
As a result, the company continu-
ously strives to mesh its business
in the perfumeries with the online
shop and other channels.
The stores have online terminals, for instance, where cus-
tomers can order products that are out of stock and have
them sent to their home address or the perfumery. Con-
versely, every Douglas perfumery has its own profile in the
online shop so that customers can go online to find infor-
In 2000, this industry pioneer launched Germany’s
first authorised online beauty shop (douglas.de),
and its online business is still growing strongly both
in Germany and abroad.
O
The future at Douglas:
from multi-channel
and cross-channel to
omni channel
Douglas perfumery,
Schloss-Arkaden, Braunschweig
064

mation about products, current offers, services and events
in the stores. Not only that, but they can also check online
to see whether a product is available in individual stores.
If a product is currently out of stock at one store, they can
choose to visit another store or order the product online.
Douglas has also integrated many interactive features
into its online shop that can give customers some valua-
ble guidance when visiting one of the stores as well. One
of these, for example, is the opportunity to rate purchases
in the online shop and share their product experiences
with other customers.
A Douglas smartphone app enables mobile beauty shop-
ping and offers a variety of service-related functions. In-
ternet and social media can support stationary business
superbly as all channels share the same goal: to make
the customer’s shopping experience as attractive and
pleasant as possible.
The cross-channel concept employed by Douglas has
already won numerous awards in trade magazines and
is being expanded continuously.
Here are three examples
that illustrate just how
well online and offline
elements interact
at Douglas:
1.Products ordered online can be delivered
to any address or to the customer’s store of
choice, where the customer can pick the
product up, pay for it if necessary and even
exchange or return it.
2.The online shop’s availability check feature
lets customers see whether the product
they want is in stock at the perfumery
before they set out on their shopping trip.
Beginning in summer 2014, this product
can even be reserved online for pick-up
in the store.
3.At douglas.de, customers can rate products
purchased in the perfumery or online shop
and share their experiences with other
customers who can then consult this infor-
mation when making their own purchases.
065

short holiday in France
in the middle of the
Main-Taunus-Zentrum
La Maison
du Pain
066

Boulangerie, pâtisserie and brasserie –
visitors to La Maison du Pain, which has
been a tenant in the new northern
mall of the Main-Taunus-Zentrum since
November 2011, are greeted with this
blend and the charm of a provincial bakery
infused with a French ambience.
Pain or baked on site. Even if you just need a quick snack,
you’ve come to the right place. Since February, the shop
has had a pick-up window that lets customers grab a
coffee or croissant to go which they can consume while
window shopping.
This chain now has five shops in the Rhine-Main area.
Owner Bernd Steiner, who just acquired the group in early
2014, wants to create spaces that give customers the im-
pression of being on a short holiday in France and plans
to open other shops soon throughout Germany. He con-
siders the Maison du Pain in the MTZ to be a true flagship
shop featuring a special kind of French flair: rustic furni-
ture made of solid wood, stained oak floors and crystal
chandeliers lend the restaurant a cosy atmosphere, and
French songs can be heard in the background. Guests can
also relax on the shop’s own terrace in summer. The
friendly staff look extremely authentic in their chef’s hats.
And the icing on the cake is the unmistakable scent ema-
nating from the ovens – one you would really only expect
to find in a country bakery in southern France.
Guests will find croissants, beignets,
pains au chocolat, petits fours, warm
and cold tartines, filled baguettes, deli-
cious soups, hearty quiches and salads.
Choosing between them isn’t always
easy, regardless of whether you are looking for break-
fast, lunch or an evening snack. Baked using original
French recipes, these specialities are offered fresh all
day long and are produced exclusively for La Maison du
G
The specialities are produced exclusively
for La Maison du Pain or baked on site.
067

The Main-Taunus-Zentrum once offered
a row of vending machines for round-the-
clock shopping.
068

The Main-
Taunus-Zentrum
turns 50
by Manfred Becht
The Main-Taunus-Zentrum in
Sulzbach, a stone’s throw away
from Hesse’s vibrant business
centre of Frankfurt, is not just
any shopping center. It is, if you
will, the mother of all shopping
centers.
069

and service outlets, a medical practice and a nursery. The
Main-Taunus-Zentrum or simply MTZ, as it has always
been called, started out with 45,000 m² of retail floor
space. One notable attraction was the largest row of
vending machines in Germany, with a choice of 1,200 ar-
ticles around the clock.
The MTZ became an instant success and was constantly
extended and expanded accordingly. Each time, the ap-
proach was innovative: 1968 saw the opening of a drive-in
cinema – another idea imported from the USA. It was dur-
ing this phase that the MTZ began to redefine its strategy:
contracts for very cheap discount stores were not extend-
ed and the standard of the offering was raised. In 1994,
the Kinopolis was opened; this, too, was a response to the
changing times.
The year 1998 heralded a new era, when the manage-
ment of the Main-Taunus-Zentrum was taken over by ECE.
The expansion work continued in Sulzbach – the row of
shops was lengthened to 500 metres and the retail floor
space was extended even further. The appearance also
changed. The cold structure of the early years gave way
to a more decorative and cheerful architecture. The cov-
ered indoor market provided the boulevard with a focal
point and a meeting place. The MTZ is majority-owned by
Deutsche EuroShop, which has had a stake in the property
since it was founded in 2000.
It was the very first of its kind in Europe
in 1964 and as such it has now reached a
significant milestone – its 50th birthday.
But this does not mean that it has be-
come outdated; nothing could be further
from the truth. When the Frankfurter
Rundschau newspaper put the region’s shopping centers
to the test early this year, the Main-Taunus-Zentrum
scored maximum points, achieving first place. And that
despite fierce competition from new and well-established
shopping centers in the Rhine-Main area.
Canadian Jerry Shefsky and American Vincent Cariste
could not have imagined this when they travelled around
metropolitan areas in the Federal Republic of Germany in
1959 in search of the best place to erect a shopping cent-
er. In April 1961, the two managing directors of the newly
formed Deutsche Einkaufszentrum GmbH (DEZ) an-
nounced that their first project would be built in the mu-
nicipality of Sulzbach.
Far from everyone in the local area was happy. But the
mayor argued that the municipality would receive consid-
erable revenues from trade tax, presenting it with new
and exciting opportunities. The farmers, too, were happy
because they wanted to be paid well for their fields. Once
the building permit was on the table, everything hap-
pened quickly; not even the discovery of bombs from the
Second World War could hold up the workers, of whom at
times more than 1,000 were involved in building 80 shops
5050505055550550555555555555555555000000000000000000000000000000000005555555555555550505555505050000and service outlets, a medicaand service outlets, a medica
Main-Taunus-Zentrum or siMain-Taunus-Zentrum or si
been called, started out wibeen called, started out wi
space. One notable attractspace. One notable attract
vending machines in Germavending machines in Germa
ry first of its kind in Europed in Europe
as such it has now reached aw reached a
milestone – its 50th birthday.milestone – its 50th birthday.
s not mean that it has be-s not mean that it has be-
ed; nothing could be furthered; nothing could be further
070
I

12,000 m² to its current size of 91,000 m². Seventy new
businesses were opened, bringing the total number of
shops that now offer their goods and services there to
170. Tenants like Hollister and Apple ensure that young
people feel drawn to the Main-Taunus-Zentrum more than
before. Above all, fashion, which remains a focal point in
the MTZ, is now represented by an even wider range, and
the catering facilities are also far larger. What is more,
additional parking spaces were created – there are now
4,500 spaces and all are free of charge.
The northern expansion quickly became a huge success.
Revenue rose by €80 million to around €400 million a
year. An average of 40,000 people pass through its doors
daily, making the Main-Taunus-Zentrum one of the most
heavily frequented retail locations in Germany.
Only a few years after that it was not only the offering that
was expanded. A new, attractive supplier of consumer
electronics, household appliances and computers came
on board in the form of MediaMarkt. The construction of
the Breuninger clothing store also attracted new consum-
er groups to the MTZ. Breuninger alone expanded the re-
tail floor space of the MTZ by 9,000 m². All these busi-
nesses with their high-end products are making the
Main-Taunus-Zentrum increasingly attractive, particular-
ly to discerning customers from an affluent region. To
meet the needs of this increased customer traffic, a car
park with 1,700 spaces was built.
The Main-Taunus-Zentrum underwent the greatest
expansion since its opening with the construction of a
second row of shops opened in 2012. €75 million were
invested, and the retail floor space was expanded by
The motorway was a special attraction
for the mall’s youngest visitors during the
MTZ’s early years.
5012,000 m² to its current siz12,000 m² to its current siz
businesses were opened, bbusinesses were opened, b
shops that now offer theirshops that now offer their
170. Tenants like Hollister a170. Tenants like Hollister a
people feel drawn to the Mainpeople feel drawn to the Main
was not only the offering thatoffering that
ctive supplier of consumerf consumer
ances and computers cameances and computers came
iaMarkt. The construction ofiaMarkt. The construction of
e also attracted new consum-e also attracted new consum-
An enormous crowd descended
on the Main-Taunus-Zentrum
on its very first day, even before the
construction signs had come down.
071

CALENDAR OF EVENTS OF THE
MAIN-TAUNUS-ZENTRUM FOR 2014:
02.–04.01: Worlds of Ice
14.02.: Valentine’s Day
01.–03.03.: Carnival
28.–29.03.: Spring-Summer
03.–19.04.: Easter
26.06.–05.07.: Puzzling & Riddling
10.06.–16.08.: Holiday Games
21.–30.08.: The Beatles
04.–20.09.: 50 Years MTZ
02.–11.10.: Fashion Star
24.11.–24.12.: Christmas
The retail concept of the Frankfurt/Rhine-Main Regional
Association stipulates that no additional retail space is to
be created “on greenfield sites”. But policy guidelines are
not meant to last forever…
And there is every reason to believe that the MTZ will
continue its successful development. Some 2.2 million
people live inside its catchment area, and the Rhine-Main
area is the only region of Hesse that is predicted to keep
on growing for some time to come. The Main-Taunus dis-
trict in which the MTZ lies has the fourth-highest spend-
ing power of all the German administrative districts,
while the neighbouring Hochtaunus district actually has
the second-highest income per capita. The location right
on the outskirts of Frankfurt, visible from the busy A66
motorway, would be even better if plans could be real-
ised to build a suburban rail station alongside the MTZ.
50The retail concept of the FraThe retail concept of the Fra
Association stipulates that nAssociation stipulates that n
be created “on greenfield sitbe created “on greenfield sit
not meant to last forever…not meant to last forever…
o believe that the MTZ willhe MTZ will
elopment. Some 2.2 million2.2 million
ent area, and the Rhine-Mainent area, and the Rhine-Main
sse that is predicted to keepsse that is predicted to keep
come. The Main-Taunus dis-come. The Main-Taunus dis-
Above: Celebrities can be seen from time
to time at the Main-Taunus-Zentrum – here is
Heino, a German singer, in his early years
Left side: The fountain with the penguins
was a central meeting point at MTZ for decades,
and many still remember it fondly.
072

The Stadt-
Galerie Passau
turns 5
Above: Jürgen Dupper, the Lord Mayor
of Passau, cutting the birthday cake
Right side: Like the Stadt-Galerie,
Lena turned 5 years old and was allowed to
invite her friends to a very special party
As well as the Stadt-Galerie, a birthday girl was another focus of attention: little
Lena also turned five and was randomly picked as the winner of a very special
party. She was allowed to invite 10 friends who were all treated to presents, cake
and even their own magician.
The birthday celebrations were accompanied by numerous events at the center
as well as activities hosted by tenants who served up special offers or culinary
highlights.
As a result, the Stadt-Galerie celebrated
its 5th birthday in autumn 2013 with a
full programme of events aimed at cus-
tomers, employees and visitors. The fes-
tivities began on 26 September 2013
with a reception with the Lord Mayor of
Passau as well as a giant birthday cake that was cut into
more than 1,000 slices, which were offered to every visi-
tor free of charge.
Various raffles took place during a period of two weeks,
with quality prizes awarded daily. The main prize for the
grand finale on 12 October 2013 was a Volkswagen Beetle
including a parking space at the Stadt-Galerie, which was
won by 23-year-old Kathrin Kreitmeier from Passau.
A further highlight was a midnight shop, during which the
stores stayed open until midnight while the latest trends
in current clothing collections were also presented at
various extravagant fashion shows. Here, too, there was
a prize draw. The prize on offer was a luxury shopping
day, which began at the home of the lucky winner, who
was collected by limousine and driven to the Stadt-
Galerie, where she received a makeover, including hair
styling and make-up, and €555 to spend with the help of
a personal shopper.
September 2008 saw the grand opening of the Stadt-Galerie
Passau after just 23 months of building work. Since then it
has been offering locals and tourists a unique retail attraction
in the Neue-Mitte (“New Centre”) quarter of the city
A
5
As well as the Stadt-GaleAs well as the Stadt-Gale
Lena also turned five anLena also turned five an
party. She was allowed toparty. Sh
and even their own magiand eve
The birthday celebrationThe birthday celebratio
as well as activities hostas well as activities host
highlights.
073

074

The Centers
4 countries
19 locations
075

www.a10center.de
Investments: 100%
Leasable space: about 120,000m²
Of which retail space: 67,800m²
Parking: 4,000
No. of shops: 200
No. of Occupancy rate: 99%
Catchment area: 1.2 million residents
Purchased by DES: January 2010
Grand opening: 1996
Restructuring/
Modernisation: 2010–2011
Anchor tenants: Bauhaus, C&A, H&M,
Karstadt Sports, Medimax,
Peek&Cloppenburg, real
6.84Visitors 2013 (million)
Chausseestr. 1
15745 Wildau
A10 Center
Wildau / Berlin
O O
076

www.main-taunus-zentrum.de
Investments: 52%
Of which retail space: 98,500m²*
Parking: 4,500
No. of shops: 170
Purchased by DES: September 2000
Grand opening: 1964
Restructuring/Modernisation: 2004
Expansion: 2011
Anchor tenants: Apple, Breuninger, Galeria
Kaufhof, H&M, Hollister,
Karstadt, Media Markt, REWE
* plus C&A
Königsteiner Str.
65843 Sulzbach (Taunus)
Main-Taunus-Zentrum
Sulzbach / Frankfurt
O O
077

www.altmarkt-galerie-dresden.de
Investments: 100%
Parking: 500
No. of shops: 200
Grand opening: 2002
Expansion: 2011
Anchor tenants: Apple, Hollister, H&M,
Saturn, SinnLeffers,
SportScheck, Zara
Webergasse 1
01067 Dresden
Altmarkt-Galerie
Dresden
O O
078

www.rhein-neckar-zentrum-viernheim.de
Investments: 100%
Parking: 3,800
No. of shops: 110
Grand opening: 1972
Restructuring/Expansion: 2002
Anchor tenants: Engelhorn Active Town,
Humanic, Peek&Cloppenburg,
H&M, TK Maxx, Zara
* plus Karstadt and C&A
Robert-Schumann-Str. 8a
68519 Viernheim
Rhein-Neckar-Zentrum
Viernheim / Mannheim
O O
079

www.herold-center.de
Investments: 100%
Parking: 850
No. of shops: 140
Grand opening: 1971
Restructuring/Expansion: 1995 and 2003
Anchor tenants: C&A, H&M,
Peek&Cloppenburg, REWE
* plus Karstadt
11.40Visitors 2013 (in million)
Berliner Allee 34–44
22850 Norderstedt
Herold-Center
Norderstedt
O O
080

www.allee-center-magdeburg.de
Investments: 50%
Parking: 1,300
No. of shops: 150
Purchased by DES: October 2011
Grand opening: 1998
Expansion: 2006
Anchor tenants: H&M, Saturn, SinnLeffers,
SportScheck, REWE
Ernst-Reuter-Allee 11
39104 Magdeburg
Allee-Center
Magdeburg
O O
081

www.billstedt-center.de
Investments: 100%
Parking: 1.500
No. of shops: 110
Grand opening: 1969/1977
Restructuring: 1996
Anchor tenants: C&A, H&M, Media Markt,
TK Maxx, Toom
* plus Karstadt
Möllner Landstr. 3
22111 Hamburg
Billstedt-Center
Hamburg-Billstedt
O O
082

www.phoenix-center-harburg.de
Investments: 50%
Parking: 1,600
No. of shops: 110
Purchased by DES: August 2003
Grand opening: 2004
Karstadt Sports, Media Markt,
New Yorker, REWE, SinnLeffers
Hannoversche Str. 86
21079 Hamburg
Phoenix-Center
Hamburg-Harburg
O O
083

www.forum-wetzlar.de
Investments: 65%
Parking: 1,700
No. of shops: 110
Purchased by DES: October 2003
Grand opening: 2005
Anchor tenants: Kaufland, Media Markt,
Sporthaus Kaps, Thalia
Am Forum 1
35576 Wetzlar
Forum
Wetzlar
O O
084

www.allee-center-hamm.de
Investments: 100%
Parking: 1,300
No. of shops: 90
Purchased by DES: April 2002
Grand opening: 1992
Renovation/Restructuring: 2003, 2009
Peek&Cloppenburg,
REWE, Saturn
Richard-Matthaei-Platz 1
59065 Hamm
Allee-Center
Hamm
O O DEUTSCHEEUROSHOPANNUALREPORT2013/THECENTERS
085

www.city-galerie-wolfsburg.de
Investments: 100%
Parking: 800
No. of shops: 100
Grand opening: 2001
Restructuring: 2011
Anchor tenants: Hempel, New Yorker,
REWE, Saturn
Porschestr. 45
38440 Wolfsburg
City-Galerie
Wolfsburg
O O
086

www.rathaus-center-dessau.de
Investments: 100%
Parking: 850
No. of shops: 90
Purchased by DES: November 2005
Grand opening: 1995
Anchor tenants: H&M, Modehaus
Fischer, Thalia, TK Maxx
* plus Karstadt
Kavalierstr. 49
06844 Dessau-Roßlau
Rathaus-Center
Dessau-Roßlau
O O
087

www.city-arkaden-wuppertal.de
Investments: 100%
Parking: 650
No. of shops: 80
Grand opening: 2001
Restructuring: 2011
Anchor tenants: Akzenta, H&M, Thalia, Zara
Alte Freiheit 9
42103 Wuppertal
City-Arkaden
Wuppertal
O O
088

www.city-point-kassel.de
Investments: 100%
Parking: 220
No. of shops: 60
Grand opening: 2002
Restructuring: 2009
Anchor tenants: H&M, New Yorker,
Saturn, Sport Voswinkel
Königsplatz 61
34117 Kassel
City-Point
Kassel
O O
089

www.stadtgalerie-passau.de
Stadt-Galerie
Passau
O O
Investments: 75%
Parking: 500
No. of shops: 90
Purchased by DES: December 2006
Grand opening: 2008
Anchor tenants: C&A, Esprit, Saturn, Thalia
Bahnhofstr. 1
94032 Passau
090

www.stadt-galerie-hameln.de
Investments: 100%
Parking: 500
No. of shops: 100
Grand opening: 2008
Anchor tenants: Müller Drogerie,
New Yorker, real, Thalia
Pferdemarkt 1
31785 Hameln
Stadt-Galerie
Hameln
O O
091

l
Centers
abroad
092

www.galeriabaltycka.pl
Investments: 74%
Parking: 1,050
No. of shops: 193
Grand opening: 2007
Anchor tenants: Carrefour, H&M,
Peek&Cloppenburg,
Saturn, Zara
al. Grunwaldzka 141
80-264 Gdánsk, Poland
Galeria Baltycka
Gdansk / Poland
O O
093

www.city-arkaden-klagenfurt.at
Investments: 50%
Parking: 880
No. of shops: 120
Grand opening: 2006
Anchor tenants: C&A, Peek&Cloppenburg,
Saturn, Zara, H&M
Heuplatz 5
9020 Klagenfurt, Austria
City–Arkaden
Klagenfurt / Austria
O O
094

www.arkadpecs.hu
Investments: 50%
Parking: 850
No. of shops: 130
Grand opening: 2004
Anchor tenants: C&A, H&M, Media Markt,
Spar
Bajcsy Zs. U. 11/1
7622 Pécs, Hungary
Árkád
Pécs / Hungary
O O
095

Investor Relations
The Shopping Center Share
Share price: sideways trend with
increasing volatility
Deutsche EuroShop shares started 2013 in a strong position on the
stock market: at €31.64, the 2012 year-end closing price was the
highest to date. In the first four months, the shares hovered between
€30.50 and €32.00, before reaching a new all-time high in mid-May
(Xetra closing price of €34.48 on 20 May 2013). In a declining stock
market environment, the price of the shopping center shares then fell
as low as €29.45 on 24 June. Shortly after the distribution of the
dividend, the shares reached an annual low at this level. In the follow-
ing weeks, they fluctuated within a slightly broader range, between
€30.50 and €33.20. At the end of the year, the price was €31.83, and
the shares ended the year on a positive trend. The market capitalisa-
tion of Deutsche EuroShop rose by almost €10 million to €1,717 mil-
lion in 2013.
Keeping pace with the peer group
The price of Deutsche EuroShop shares rose by 0.6%. Taking into ac-
count the dividend paid of €1.20 per share, the year-on-year perfor-
mance of Deutsche EuroShop shares amounted to 4.5% (2012: 32.7%).
Our shares were therefore below the European benchmark for listed
real estate companies, the EPRA index (+9.6%, previous year: +29.2%),
* Corio, Eurocommercial Properties, Klepierre, Mercialys and Unibail-Rodamco.
2013 2012
DES share 4.5% 32.7%
DAX 25.5% 29.1%
MDAX 39.1% 33.9%
TecDAX 40.9% 20.9%
EPRA 9.6% 19.2%
EURO STOXX 50 (Europe) 17.6% 13.7%
Dow Jones (USA) 26.5% 7.2%
Nikkei (Japan) 56.7% 22.9%
and in the upper-middle range of the European peer group compa-
nies* in 2013. The benchmark index for medium-sized companies, the
MDAX, gained 39.1% in the year under review.
German open-ended property funds achieved an average perfor-
mance of +1.1% in the past year (2012: -0.7%) and attracted cash in-
flows of around €3.4 billion (2012: €2.9 billion).
STOCK MARKET PERFORMANCE
DEUTSCHEEUROSHOPGESCHÄFTSBERICHT2013/INVESTORRELATIONS
096

36
34
32
30
28
400
300
200
100
0
Number of shares in thousand
2013 2014
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar
in €
Trend of shareO O
097

35
30
25
20
15
10
5
-5
-10
-15
-20
-25
2,000
1,500
1,000
500
0
-20.6
477
Share performance
in %
Market capitalisation
in € million
484 527
602
816
965
808 835
895
1,496
1,280
1,707 1,717
2.7
15.6
-13.1
2.1
19.6
28.7
22.8
7.9
28.1
-11.1
32.7
4.5
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Annual performance including dividends
Deutsche EuroShop Shares – key figures
WKN/ISIN 748 020/DE 000 748 020 4
Ticker-Symbol DEQ
Share capital in € 53,945,536.00
Number of share (non-par
value registeres shares) 53,945,536
Indices MDAX, EPRA, GPR 250, MSCI Small Cap, EPIX 30,
HASPAX, F.A.Z.-Index, DivMSDAX, EURO STOXX,
STOXX Europe 600
Official market Prime Standard
Frankfurter Wertpapierbörse and Xetra
OTC markets Berlin-Bremen, Dusseldorf, Hamburg, Hanover,
Munich and Stuttgart
Share performance and market
capitalisation since the IPO
O O
098

The Annual General Meeting was held in Hamburg on
20 June 2013. Around 200 shareholders were in attend-
ance at the Handwerkskammer, representing 56.7%
(previous year: 63.2%) of the capital, and they approved
all the items on the agenda.
Trend of share (indexed) since the start of 2013
140
120
100
80
MDAX
EPRA
Deutsche EuroShop
Jan
13
Feb
13
Mar
13
Apr
13
May
13
June
13
July
13
Aug
13
Sep
13
Oct
13
Nov
13
Dec
13
Jan
14
Feb
14
Mar
14
Trend of share (indexed) – 5 year overview
350
300
250
200
150
100
50
0
MDAX
EPRA
DAX
Deutsche EuroShop
Attendance at Annual General
Meeting falls slightly
Jan.
09
June
09
Jan.
10
June
10
Jan.
11
June
11
June
12
June
13
Jan.
12
Jan.
13
099

Q205
Q105
Q304
Q404
Q204
Q206
Q207
Q208
Q209
Q210
Q211
Q212
Q305
Q306
Q307
Q308
Q309
Q310
Q311
Q312
Q405
Q406
Q407
Q408
Q409
Q410
Q411
Q412
Q113
Q213
Q114
Q106
Q107
Q108
Q109
Q110
Q111
Q112
Broad coverage of the shares
Our shares are now regularly followed by 23 analysts (as at 15 April
2014) from respected German and international financial institutions,
and their recommendations introduce us to new groups of investors.
Deutsche EuroShop is one of the best-covered property companies in
Europe. Information on the recommendations can be found at
www.deutsche-euroshop.com/research
Annual report receives “platinum”
and “red dot”
In the “LACP 2012 Vision Awards Annual Competition” run by the
LACP (League of American Communications Professionals), our 2012
annual report was awarded platinum in the “Real Estate” category,
with 99 out of a possible 100 points. It was also chosen as one of the
50 best annual reports in the world.
In addition, our 2012 annual report was awarded the highly acclaimed
“red dot design award” for its excellent design. The “red dot” is one
of the largest and most prestigious design competitions in the world.
Further awards for our capital market communications can be found
on our website at
www.deutsche-euroshop.com/ircommunication
Q313
Q413
in %
100
75
50
25
0
Negative
Neutral
Positive
The analysts are neutral to positive on the prospects for the DES share (as at 15 April 2014).
Diversity of analyst’s
opinion
O O
100

Shareholder structure slightly changed
The number of investors rose slightly in 2013: Deutsche EuroShop
now has around 9,300 shareholders (as at 15 April 2014, previous
year: 9,050, +3%). The structural breakdown has barely changed: in-
stitutional investors still hold around 53.7% of the shares, and private
investors around 24.3% (previous year: 24.4%). The Otto family’s
stake is 16.0%. The charitable Hertie Foundation and BlackRock re-
port that they currently each hold slightly over 3% of the shares and
are therefore still the largest institutional investors.
In a shareholder identification process, we have been able to analyse
the international distribution of our shares. While German investors
continue to hold a clear majority (just under 65%) in Deutsche EuroShop,
Private investors
24.3
Otto family
16.0
Hertie-Stiftung
3.0
BlackRock
3.0
SHAREHOLDER’S STRUCTURE IN %
Institutional investors
53.7
USA
7.6
Netherlands
7.3
United Kingdom
6.0
France
5.4
Belgium
3.5
SHAREHOLDER’S STRUCTURE REGIONAL IN %
Germany
64.5
Norway
2.6
Switzerland
1.2
Other
1.9
the shareholder structure is dominated by European investors overall,
with Dutch, British and French investors leading the way. US investors
represent around 8% of DES shares.
0101

1.5
1.2
0.9
0.6
0.3
0
35
30
25
20
15
Dividend
in €
Share price
in €
2002
0.96
2003
0.96
2004
0.96
2005
0.96
2006
1.00
2007
1.05
2008
1.05
2009
1.05
2010
1.05
2011
1.05
2012
1.10
2013
1.20
2014
1.25*
15.50
16.88
19.26
23.73
28.08
23.50
24.30
23.67
28.98
24.80
31.64
31.56
33.73**
New distribution strategy
The Executive and Supervisory Boards will propose payment of a
dividend of €1.25 per share for financial year 2013 to the Annual
General Meeting in Hamburg on 21 June 2014; this represents an
increase of €0.05 per share.
With our long-term strategy of a dividend policy based on continuity
and a yield of 3.9% (based on the 2013 year-end closing price of
€31.83), we hope to cement the confidence of our existing sharehold-
ers and attract new investors. Our intention to further increase the
dividend by €0.05 per share each year up to a total of €1.40 per share
by financial year 2016 should also help to achieve this. This would
correspond to an absolute increase of 16.6% by 2016 and an average
annual increase of 3.9%.
By taking this measure, we are responding to frequent requests for a
dividend policy that can be planned for over the long term.
*Proposal **Price on 11 April 2014 Year-end closing priceDividend (paid for the previous year)
Dividends paid to shareholders domiciled in Germany are sub-
ject to income or corporation tax. From 2009 onward, the uni-
form flat-rate withholding tax of 25% plus a solidarity surcharge
applies to private investors. Under certain conditions, excep-
tions apply to dividend payments that are regarded as equity
repayments from a tax perspective (dividend from EK04 or,
since 2001, from a contribution account for tax purposes). The
Deutsche EuroShop dividend meets these conditions in part.
Pursuant to Section 20 (1) no. 1 sentence 5 of the Einkommen-
steuergesetz (German Income Tax Act), the dividend payment
represents non-taxable income (i.e. not subject to tax) in part.
However in accordance with revised legislation in place since
2009, dividend payments are tax relevant since gains from the
sale of shares purchased after 31 December 2008 are subject
to tax. In this case, the payments reduce the cost of the invest-
ment in Deutsche EuroShop and thus lead to higher capital gains
at the time of sale.
DividendO O
Tax situation regarding
the dividend
102

2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Market capitalisation
(basis: year-end
closing price) (€ m) 1,717 1,707 1,280 1,496 895 835 808 965 816 602 527
Number of shares
(year-end) 53,945,536 53,945,536 51,631,400 51,631,400 37,812,496 34,374,998 34,374,998 34,374,998 34,374,998 31,250,000 31,250,000
Weighted average
number of shares 53,945,536 51,934,893 51,631,400 45,544,976 36,799,402 34,374,998 34,374,998 34,374,998 31,575,340 31,250,000 31,250,000
High(€) 34.48
(20.05.13)
32.03
(01.11.12)
29.06
(01.06.11)
28.98
(30.12.10)
26.00
(06.01.09)
28.40
(13.05.08)
30.09
(23.04.07)
29.12
(31.03.06)
25.25
(27.07.05)
19.44
(29.12.04)
17.35
(18.11.03)
Low € 29.45
(24.06.13)
23.72
(06.01.12)
22.94
(23.11.11)
21.72
(01.07.10)
18.66
(06.03.09)
18.50
(20.11.08)
23.22
(20.08.07)
23.89
(02.01.06)
19.12
(05.01.05)
16.45
(12.08.04)
14.85
(03.03.03)
Year-end closing price
(31 Dec) (€) 31.83 31.64 24.80 28.98 23.67 24.30 23.50 28.08 23.73 19.26 16.88
Dividend per share (€)
1.251
1.20 1.10 1.10 1.05 1.05 1.05 1.05 1.00 0.96 0.96
Dividend yield
(31 Dec) (%) 3.9 3.8 4.4 3.8 4.4 4.3 4.5 3.7 4.2 5.0 5.7
Annual performance
excl./incl. dividend 0.6%/4.5%
27.6%/
32.7%
-14.4%/
-11.1%
22.4%/
28.1%
-2.6%/
2.1%
3.4%/
7.9%
-16.3%/
-13.1%
18.4%/
22.8%
23.2%/
28.7%
14.1%/
19.6%
8.9%/
15.6%
Average daily trading
volume (shares)
112,400
(incl.
multilateral
trading
facilities
>204,000)
129,400
(incl.
multilateral
trading
facilities
>174,000)
125,400
(incl.
multilateral
trading
facilities
>210,000) 116,084 113,008 143,297 144,361 93,744 76,786 36,698 12,438
EPS (€)
(undiluted) 3.17 2.36 1.92 -0.17 0.93 2.00 2.74 2.92 1.55 0.89 0.61
All information onwards relates to Xetra.
1
proposal
Patrick Kiss Nicolas Lissner
Then visit us online or call us:
Patrick Kiss and Nicolas Lissner
Tel.: +49 (0)40 - 41 35 79 20/-22
Fax: +49 (0)40 - 41 35 79 29
E-Mail: ir@deutsche-euroshop.com
Internet: www.deutsche-euroshop.com/ir
Would you like
additional information?
103

Breakdown of Deutsche
EuroShop shares
(in %)
104

105

Annual General
Meeting
At least 200 shareholders
were in attendance to hear
Executive Board Spokes-
man Claus-Matthias Böge
talk about the events and results of the previ-
ous financial year. The Group’s figures in re-
lation to general economic data and the situ-
ation in the real estate market were examined
in detail. The meeting also discussed the ac-
quisition of the Herold-Center in Norderstedt
and the increase in our shareholding in the
Altmarkt-Galerie Dresden to 100%.
The speech and presentation were already
available at the website address given below
very soon after the event. Interested parties
will also find there a large archive of agendas
and other information relating to our recent
Annual General Meetings.
The agenda 2013 for this meeting included
the election of three Supervisory Board
members: Manfred Zaß and Alexander Otto
were returned to office, while Dr Henning
Kreke was elected to the Board as a new
member for a term of five years. New author-
ised capital was also created. The attendance
at the time of the vote was 56.7%.
Shareholders made use of the opportunity to talk with the Super-
visory Board, the Executive Board and employees before the Annual
General Meeting and at the refreshments that followed it.
The Annual General Meeting for the 2013 financial year will be held on
18 June 2014 at the Handwerkskammer Hamburg. The invitation as
well as all the documents needed for ordering entry tickets and for vot-
ing via the Internet will be posted out to our shareholders in good time.
www.deutsche-euroshop.de/agm
A
The Handwerkskammer Hamburg on the
Holstenwall, built from 1912 to 1915.
The Annual General Meeting of
Deutsche EuroShop was held, in
the historic rooms of the Hand-
werkskammer Hamburg as it had
been before, on 20 June 2013.
106

Deutsche EuroShop
Real Estate
Summer
We ran the third Deutsche EuroShop
Real Estate Summer on 22 and 23 Au-
gust 2013. We launched this series of
events in the summer of 2009 with the
aim of giving our analysts and others an in-depth, up-to-
date insight into the Deutsche EuroShop portfolio through
presentations covering all aspects of shopping and real
estate. The first Deutsche EuroShop Real Estate Summer
was held in Dresden in 2009, and in 2011 we visited our
centers in Wolfsburg, Magdeburg and Wildau.
Last year, we invited institutional investors and financial
analysts who currently cover our stock to Klagenfurt on
Lake Wörthersee, where the event kicked off on 22 Au-
gust with presentations on the Austrian real estate mar-
ket as well as on the challenges of leasing at a time when
more and more shopping is being done online. These
were followed by an introduction to the City Arkaden
Klagenfurt, a tour of the city centre and an excursion to
the competitive environment.
More presentations were on the agenda for the following
day: Stephan Jung from the German Council of Shopping
Centers spoke about the future of retailing, Wolfgang Ku-
batzki from Feri Euro Rating addressed the evaluation of
shopping centers, and Dr. Gerold Doplbauer of GfK Geo-
Marketing explained his forecasts for the shopping center
concept within the context of current dynamic changes in
retail habits. The event closed with a Questions & Answers
session with Claus-Matthias Böge, CEO.
W
Upper left: Entrance to the City-Arkaden in Klagenfurt
Left: Tour of the City Arkaden
Right: Lecture by Dr. Gerold Doplbauer, Senior Consultant,
GfK GeoMarketing
107

Marketing
“An investment with
stability”
In 2013 we placed advertisements in the
trade press designed for highly specific tar-
get groups that were perfectly timed to coin-
cide with the publication of our current finan-
cial figures and referred to our motto for the
year, “Hamburg3
”. At the same time, we made
a play on the “safe haven” aspect, which is
how many describe our share.
Ein guter Gründ:
Ein Investment mit
Stabilität
Weitere gute Gründe für die Aktie
der Deutsche EuroShop unter
www.shoppingcenter.ag
New blow-up at Main-Taunus-Zentrum
After two years in which our giant poster “Main Taunus, Mein Zentrum, Meine Aktie”, brought
a smile to the lips of thousands of drivers every day, hurricanes “Christian” and “Xaver” forced
us to replace the blow-up. We took the opportunity to change the motif as well. Now, the
14x9 m blow-up not only refers to the MTZ (as the Main-Taunus-Zentrum is often called), but
also creates a link with Deutsche EuroShop, via whose shares investors can obtain an indirect
stake in the Main-Taunus-Zentrum.
A
C
108

120
100
80
60
40
20
0
20
15
10
5
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Pages
in thousand
Sites
in thousand
The Internet is gaining increasing importance as a source of
information, with the corporate website very often the first
jumping-off point for investors. Our website has been very pop-
ular for years, and is always ranked among the best in the MDAX
and European property sector for the information it provides
and its user friendliness. Our website can be found at
www.deutsche-euroshop.com
Social media on an upward trend
Social media are establishing themselves as a channel of communi-
cation – including for capital market participants. For many years we
have shown ourselves to be open to technical innovations and use so-
cial media actively to provide our investors and interested parties
with news and supplementary information about Deutsche EuroShop.
Perhaps we can establish contact with you through one or more of
these platforms too – we would be happy to see you there:
Twitter Follow us on Twitter: www.twitter.com/DES_AG
Facebook Become a fan on Facebook: www.facebook.com/euroshop
Google+ Add us to your circle on Google+:
plus.google.com/102911789106628036776
IR Mall Read and follow our Investor Relations blog: www.ir-mall.com
Flickr View our photos on the online platform Flickr: www.flickr.com/desag
SlideShare See our presentations and reports on SlideShare:
www.slideshare.net/desag
YouTube Watch our videos on YouTube:
www.youtube.com/DeutscheEuroShop
In addition to share marketing, we also concen-
trate on further developing and maintaining the
Deutsche EuroShop brand. Our goal is to boost
awareness and recognition of the brand. The
intention of Deutsche EuroShop is to establish
itself as the brand for investments in shopping
centers.
Stable hit figures for website
Visitors and page hits per month
The brand DEUTSCHEEUROSHOPGESCHÄFTSBERICHT2013/INVESTORRELATIONS
109

Conferences and
roadshows in 2013
In order to discuss Deutsche EuroShop’s strategy
with its present investors and to present the Com-
pany to potential new investors, the Executive Board
and the Investor Relations team again participated
in various conferences and held numerous roadshows last year.
Direct contact with our investors is very important to us: by engaging
in frank discussions with analysts as well as fund and portfolio
managers, we seek to understand the requirements of the capital
market and to learn which issues are seen as most important. Con-
versely, investment by fund management companies is often depend-
ent on their being able to meet, on a regular basis, the Executive Board
members of companies in which they invest.
In 2013, we participated in nine roadshows in Frankfurt, Munich,
Amsterdam, Geneva, London, Milan, Paris and Zurich. We also attended
13 conferences in Baden-Baden, Frankfurt, Hamburg, Munich, Amster-
dam, London, Lyons and New York.
During all these events we had around 250 one-to-one discussions.
We also held teleconferences, which organised regularly, for example,
for the publication of the annual and quarterly figures.
Many investors also visited us at the new Deutsche EuroShop head
offices in Hamburg-Poppenbüttel, often also visiting our properties in
and around Hamburg. We also, as part of a property tour, gave inves-
tors an on-site introduction to our center in Wuppertal.
We are once again planning a diverse range of investor relations
activities for 2014, in order to cultivate contacts with our existing in-
vestors and tap new investor groups. You can find an overview in our
financial calendar on page 194. A constantly updated version can also
be found on our website, at
www.deutsche-euroshop.com/ir
A roadshow involves a team, usually consisting of an
Executive Board member and an Investor Relations
manager of Deutsche EuroShop, travelling together
with representatives of the organising bank (such as
analysts and client advisors) to a financial centre to
visit existing or interested, potential investors in
person and inform them about the Company’s current
development and strategy. Investors have the opportu-
nity to meet the management personally and put
questions to them. This allows up to 10 meetings to be
held in one city on a single day.
These are conferences, generally organised by banks, at
which both investors and companies are given the op-
portunity to hold as many meetings as possible in a day.
This makes it possible to address questions in detail
during one-to-one and group discussions. Company
presentations enable the Company to present itself to a
wider specialist audience.
CAPITAL MARKET CONFERENCES
ROADSHOWS
I
110

10 reasons to invest in
Deutsche EuroShop share
1.
The only public company in Germany to invest
solely in shopping centers
2.
Prime locations
3.
Proven, conservative strategy
4.
Stable cash flow with long term visibility
5.
Shareholderfriendly dividend policy
6.
Experienced management team
7.
Excellent track record
8.
Centers almost 100% let
9.
Inflation-protected rental agreements
10.
Solidity combined with growth potential
111

Profitable portfolio with a stable value
Deutsche EuroShop AG holds a balanced, diversified port-
folio of shopping centers in Germany and other parts of
Europe. We focus our investment activities on prime loca-
tions in cities with a catchment area of at least 300,000
residents in order to guarantee a sustained high level of
investment security.
Seize opportunities, maximise value
In line with our buy and hold strategy, we consistently
place greater importance on the quality and yield of our
shopping centers than on our portfolio’s rate of growth.
We monitor the market continuously and act as buyers
when an opportunity arises. Short decision-making chan-
nels and considerable flexibility in terms of potential in-
vestment and financing structures enable us to adapt to
any competitive situation. At the same time, we are com-
mitted to optimising the value of our portfolio’s existing
properties.
Objectives and strategy
Corporate governance focuses on investments in high-qual-
ity shopping centers in city centres and well-established lo-
cations that have the potential to appreciate steadily over
time. Another important investment objective is to generate
high surplus liquidity from long-term leases of shopping
center space which can then be distributed to shareholders
in the form of annual dividends. To achieve these objectives,
the Company diversifies its risk by investing in shopping
centers in a number of European regions; the main focus is
on Germany. Indexed, revenue-based commercial rents
guarantee the desired high return.
The Company invests in shopping center project develop-
ments at an early stage and can invest up to 10 percent of its
equity as part of joint ventures.
Financing for new investments should be balanced, and the
Group’s long-term debt-to-equity ratio must not exceed 55%.
When taking out or extending loans, interest rates must be
locked in for an extended period of time with the goal of
keeping the duration (average fixed interest period) at over
five years.
Declaration on
Corporate Governance
Deutsche EuroShop AG is a transparent company that operates in
accordance with a strategy geared towards long-term success. This
focus on permanence is a key aspect of our corporate culture. We
strive to promote the trust of investors, creditors, staff, business part-
ners and the public in the leadership and supervision of our Company
on the basis of legal and company-specific conditions governing the
management of a listed company. This goal is consistent with the ob-
jectives of a demanding corporate governance system. In conformity
with section 3.10 of the Deutscher Corporate Governance Kodex (Ger-
man Corporate Governance Code) as well as section 289a (1) of the
Handelsgesetzbuch (HGB – German Commercial Code), this declara-
tion contains a report by the Executive Board, also on behalf of the
Supervisory Board, on corporate governance.
112
O

New investment opportunities are examined by the Executive Board
and, if necessary, presented to the Supervisory Board at regular
Supervisory Board meetings. Investment decisions are made by the
Executive Board and then submitted to the Supervisory Board for
approval within the framework of a decision paper.
Moreover, the Executive and Supervisory Boards discuss develop-
ments on the capital and credit markets as well as the effects of these
not only on the Company’s strategy but also in terms of raising equity
and obtaining borrowed capital.
The Supervisory Board and its committees also discuss other topical
issues with the Executive Board as required. Transactions requiring
the approval of the Supervisory Board are discussed and resolved
upon at the scheduled meetings.
For transactions requiring approval, teleconferences are also conducted
with the Supervisory Board or its committees and circular resolutions
are passed in writing.
Corporate Governance 2013
The Government Commission on the German Corporate Governance
Code published the German Corporate Governance Code on 26 Febru-
ary 2002 and approved amendments and additions to individual rec-
ommendations and suggestions, most recently on 13 May 2013. Going
forward, the Government Commission will continue to monitor the
development of corporate governance in legislation and in practice,
and will adapt the Code as needed.
Working methods of the Executive and
Supervisory Boards
The Supervisory and Executive Boards performed their statutory du-
ties in financial year 2013 in accordance with the applicable laws and
the Articles of Association. The strategic orientation of the Company
was coordinated between the Executive Board and the Supervisory
Board, and the progress of strategy implementation was discussed at
regular intervals. The Executive Board informed the Supervisory
Board regularly, promptly and in detail of business developments and
the risk situation. Detailed information on the main areas of focus of
the Supervisory Board’s activities in the 2013 financial year can be
found in its report on pages 14 to 19.
In financial year 2013, there were no advisory or other contracts for
work or services in existence between members of the Supervisory
Board and the Company.
Differentiated rental system
One key component of our leasing concept is a differentiated rental
system. While individual owners in city centres are often concerned
with achieving the highest possible rents for their property (which re-
sults in a monostructured retail offering), we ensure an attractive sec-
tor mix and long-term optimisation of our rental income through com-
bined costing. The rent our lessees pay is dependent on their sector
and turnover. Indexed minimum rents (based on the consumer price
index) provide a guaranteed minimum level of income for Deutsche
EuroShop AG during economic slowdowns.
The concept of shopping as an experience
We have outsourced center management to an experienced external
partner, Hamburg-based ECE Projektmanagement GmbH & Co. KG
(ECE). ECE has been developing, planning, implementing, leasing and
managing shopping centers since 1965. With 189 shopping centers
currently under management, the company is Europe’s market lead-
er in this segment. We consider professional center management to
be the key to the success of a shopping center. Not only does it ensure
uniform opening hours and a consistently friendly, bright, safe and
clean shopping atmosphere, it also makes shopping an experience
with occasionally extraordinary presentations of merchandise, pro-
motions and exhibitions. The 500,000 to 600,000 people who visit our
19 centers on average every day are fascinated by the variety of sec-
tors represented but also by our wide range of car shows, casting
shows, fashion shows and attractions for children. These transform
shopping centers into marketplaces where something new and spec-
tacular is always on offer.
Working methods of the Executive and
Supervisory Boards
The strategic orientation of the Company is coordinated between the
Executive Board and the Supervisory Board, and the progress of strat-
egy implementation is discussed at regular intervals. The Executive
Board is required to inform the Supervisory Board regularly, prompt-
ly and in detail of business developments. The Executive and Super-
visory Boards examine the Company’s net assets, financial position
and results of operations, as well as its risk management, regularly
and in detail. In this context, the formal conditions for implementing
an efficient system of managing and monitoring the Company are
checked, as is whether the means of supervision are effective. The
significant factors affecting the business are determined by the Ex-
ecutive Board, which notifies the Supervisory Board. The committees
advise on the development of the portfolio properties, their turnover
trends, accounts receivable, occupancy rates, construction measures
and liquidity, as well as investment cost trends for our new develop-
ment projects. The sales trends and payment patterns of tenants are
observed in detail so that consequences can be drawn from these
wherever required.
113

Olaf Borkers joined Deutsche EuroShop AG in 2005, as a member of
the Executive Board. He is also a Managing Director and Director at
various different companies in the Deutsche EuroShop Group.
Supervisory Board
The Supervisory Board supervises and advises the Executive Board in its
management activities in accordance with the provisions of German
company law and the rules of procedure. It appoints members of the Ex-
ecutive Board, and significant business transacted by the
Executive Board is subject to its approval. The Supervisory Board is com-
posed of nine members, who are elected by the Annual General Meeting.
The Supervisory Board has established the notification and reporting
duties to be met by the Executive Board and has formed an Executive
Committee (which simultaneously serves as a nomination commit-
tee), an Audit Committee and a Capital Market Committee, each com-
prising three people.
The members of the Supervisory Board are:
Manfred Zaß, Chairman
Dr. Michael Gellen, Deputy Chairman
Thomas Armbrust
Karin Dohm
Dr. Jörn Kreke (until 20 June 2013)
Dr. Henning Kreke (as of 20 June 2013)
Alexander Otto
Reiner Strecker
Klaus Striebich
Dr. Bernd Thiemann
The members of the Executive Committee are Mr Zaß, Dr Gellen and
Mr Armbrust. The Executive Committee is chaired by the Chairman of
the Supervisory Board. The Committee discusses urgent business
matters and passes relevant resolutions. It is also responsible for
preparing human resources issues concerning the Executive Board
and for reviewing the Company’s corporate governance principles.
The Executive Committee of the Supervisory Board also fulfils the
function of a nomination committee.
The Audit Committee consists of Ms Dohm as Financial Expert and
Chairwoman as well as Mr Zaß and Mr Armbrust. It is responsible for
issues relating to financial reporting, auditing and the preparation of the
annual and consolidated financial statements. Former members of the
Company’s Executive Board and the Chairman of the Supervisory Board
generally do not chair the Audit Committee, to avoid conflicts of interest.
Composition and diversity
The Supervisory Board has formulated specific goals for its composi-
tion and geared itself towards the needs of a listed company with a
small staff base which makes long-term investments with high capi-
tal requirements. In view of this, the Supervisory Board should pri-
marily be composed of independent members of both genders who
have special knowledge and experience of the retail trade, the letting
of retail space, the management of shopping centers, the equity and
debt financing of listed real estate companies, and accounting princi-
ples in accordance with German and/or international regulations. The
Supervisory Board continues to believe that professional qualifica-
tions and skills should represent the key criteria for members of the
Supervisory Board. In keeping with this stance, there is no stipulated
age limit, but members should not be much older than 70.
Thus, Dr Henning Kreke succeeded his father Dr Jörn Kreke in office
after his election to the Supervisory Board at the Annual General
Meeting on 20 June 2013. The goals regarding the Board’s composi-
tion are to be adhered to in 2014 as well.
Executive Board
The Executive Board of Deutsche EuroShop AG manages the Compa-
ny in accordance with the provisions of German company law and with
its rules of procedure. The Executive Board’s duties, responsibilities
and business procedures are laid down in its rules of procedure and
in its schedule of responsibilities. The chief management duties of the
Executive Board are the determination of the Group’s strategic orien-
tation and management of the Group, planning, and the establishment
and implementation of risk management.
The Executive Board of Deutsche EuroShop AG currently comprises
two members.
Claus-Matthias Böge joined Deutsche EuroShop AG in 2001, as a
member of the Executive Board. He assumed his current position as
CEO in 2003. He is also a Managing Director and Director at various
different companies in the Deutsche EuroShop Group.
Olaf Borkers
Born 10 December 1964
First appointment: 2005
Appointment ends: 2016
Claus-Matthias Böge
Born 13 February 1959
First appointment: 2001
Appointment ends: 2015
114

Relationships with shareholders
Shareholders exercise their rights in matters concerning the Com-
pany at the Annual General Meeting. The Annual General Meeting
elects the members of the Supervisory Board and passes resolutions
approving the actions of the Executive and Supervisory Boards. It de-
cides on the appropriation of the unappropriated surplus and amend-
ments to the Company’s Articles of Association. The Annual General
Meeting, at which the Executive and Supervisory Boards give an ac-
count of the past financial year, takes place once a year. When resolu-
tions are adopted at the Annual General Meeting, each share confers
entitlement to one vote in line with the principle of “one share, one
vote”. All shareholders are entitled to attend the Annual General Meet-
ing and to speak and submit questions about items on the agenda.
Deutsche EuroShop AG reports to its shareholders and to the public
on the Company’s business performance, financial position and results
of operations four times a year in line with a financial calendar. Press
releases also inform the public and the media of Company activities.
Information that may materially influence the Company’s share price
is published in the form of ad hoc disclosures in accordance with the
statutory requirements.
The Executive Board gives regular presentations to analysts and at in-
vestor events as part of the Company’s investor relations activities. An-
alyst conferences on the release of the annual and quarterly financial
statements are broadcast over the internet, where they are available to
anyone interested in the Company. In addition, Deutsche EuroShop AG
provides financial information and other information about the Deutsche
EuroShop Group on its website.
Accounting and audits
The Deutsche EuroShop Group prepares its financial statements accord-
ing to International Financial Reporting Standards (IFRSs) on the basis
of section 315a of the Handelsgesetzbuch (HGB – German Commercial
Code). The annual financial statements of Deutsche EuroShop AG
will continue to be prepared in line with the accounting provisions of
the HGB. The Executive Board is responsible for the preparation of the
financial statements. The Chairwoman of the Audit Committee com-
missions the auditor of the annual financial statements, as elected by
the Annual General Meeting. The stricter requirements for auditor in-
dependence are met in this process.
Outlook
The composition of the Supervisory Board will continue to change
in 2014 in line with the recommendations and requirements of the
Corporate Governance Code.
The members of the Capital Market Committee are Mr Zaß, Mr Arm-
brust and Mr Strecker. The Capital Market Committee is chaired by Mr
Zaß, and his deputy is Mr Armbrust. The Supervisory Board’s powers
relating to the utilisation of approved capital and conditional capital
were transferred to the Committee for decision-making and processing.
Shareholdings
EXECUTIVE BOARD
As at 31 December 2013, the Executive Board held a total of
13,000 shares, less than 1% of Deutsche EuroShop AG’s share capital.
SUPERVISORY BOARD
As at 31 December 2013, the Supervisory Board held a total of 5,308,996
shares, more than 1% of Deutsche EuroShop AG’s share capital.
In addition to the general statutory provisions requiring public disclo-
sure, the rules of procedure of the Executive Board and of the Super-
visory Board govern the reporting duties of Executive and Supervi-
sory Board members in the event of dealings involving shares in the
Company or related rights of purchase or sale, as well as rights di-
rectly dependent on the Company’s share price.
Directors’ dealings
The following securities transactions by members of the Executive
Board and of the Supervisory Board or by certain persons related to
members of the executive bodies were notified to Deutsche EuroShop
AG during financial year 2013 in accordance with section 15a of the
Wertpapierhandelsgesetz (WpHG – German Securities Trading Act):
Date
Share
price
in €
Num-
ber
Claus-Matthias Böge Sale 03.05.2013 33.63 6,000
Carlotta Böge Sale 03.05.2013 33.30 2,500
Thomas Armbrust Purchase 24.06.2013 29.64 3,600
Annette Armbrust Purchase 24.06.2013 29.49 1,250
Gabriele Cattarius-Armbrust Purchase 24.06.2013 29.44 600
Klaus Striebich Purchase 24.06.2013 29.55 500
AROSA Vermögensver-
waltungsgesellschaft m.b.H. Purchase 25.06.2013 29.91 60,000
AROSA Vermögensver-
waltungsgesellschaft m.b. H. Purchase 26.06.2013 29.93 1,000
115

Declaration of conformity
In November 2013, the Executive and Supervisory Boards of the Company jointly submitted their updated declaration of conform-
ity with the recommendations of the Government Commission on the German Corporate Governance Code for financial year 2013
in accordance with section 161 of the Aktiengesetz (AktG – German Public Companies Act). The declaration was made perma-
nently available to the public on the Company’s website at www.deutsche-euroshop.de.
Joint declaration by the Executive and Supervisory Boards of Deutsche EuroShop AG relating to the recommendations of
the Government Commission on the German Corporate Governance Code in accordance with section 161 AktG
The Executive Board and the Supervisory Board of Deutsche EuroShop AG declare that the Company has complied with, and
will continue to comply with, the recommendations of the Government Commission on the German Corporate Governance Code
(as published by the German Federal Ministry of Justice in the official section of the electronic German Federal Gazette (Bun-
desanzeiger) on 4 July 2003, and as amended on 13 May 2013), subject to a limited number of exceptions as indicated below:
• The existing D&O insurance policy taken out for the Supervisory Board does not provide for any deductible
(Code Section 3.8).
The Executive and Supervisory Boards of Deutsche EuroShop AG have acted in a responsible manner, managing and
supervising the Company in line with the principles of creating enterprise value ever since the Company was established,
preceding the official introduction of corporate governance guidelines. The Company therefore takes the view that the
agreement of a deductible is not necessary, in particular as this has no effect on the level of the insurance premium.
• The Supervisory Board did not select a senior management team for a comparison of compensation (Code Section 4.2.2).
Since the staff of Deutsche EuroShop AG consists of just four people, a differentiation between these and a senior
management team would not be meaningful. In this respect, only the relationship between the compensation paid to the
Executive Board and that paid to the overall staff can be considered by the Supervisory Board.
• There is no stipulated age limit for members of the Executive Board (Code Section 5.1.2).
The Supervisory Board believes that professional qualifications and skills represent the key criteria for members of the
Executive Board. An age limit could force the retirement of a suitably qualified and successful Executive Board member.
• There is no stipulated age limit for members of the Supervisory Board (Code Section 5.4.1).
The Supervisory Board believes that professional qualifications and skills represent the key criteria for members of the
Supervisory Board. An age limit could force the retirement of a suitably qualified and successful Supervisory Board mem-
ber. Therefore, there is no stipulated age limit, though members should not be much older than 70 years of age.
• The remuneration of the Supervisory Board does not include any performance-based elements (Code Section 5.4.6).
The Company believes that fixed remuneration for members of the Supervisory Board best reflects the Company’s busi-
ness model. The selection of shopping centers to be acquired and held and the quality of long-term leases represent the
key factors determining the Company’s long-term success.
• The consolidated financial statements are published within 120 days of the end of the financial year (Code Section 7.1.2).
It is important to the Company to publish audited financial statements that have been approved by the Supervisory Board.
An earlier publication date is not feasible due to the schedules for the preparation, auditing and adoption of the financial
statements. Unaudited data of relevance to the capital market is published in advance.
Hamburg, 28 November 2013
The Executive Board and the Supervisory Board
Deutsche EuroShop AG
116116

Group Manage-
ment Report
118 Basic information about the Group
119 Economic review
128 Report on events after the balance sheet date
128 Outlook
130 Risk report
134 Remuneration report
136 Acquisition reporting
136 Declaration on corporate governance (section 289a HGB)
117117
DEUTSCHEEUROSHOPGESCHÄFTSBERICHT2013/KONZERNLAGEBERICHT

DEUTSCHEEUROSHOPANNUALREPORT2013/GROUPMANAGEMENTREPORT
118
Basic information about
the Group
GROUP BUSINESS MODEL, TARGETS AND STRATEGY
Deutsche EuroShop AG is the only public company in Germany to
invest solely in shopping centers in prime locations. On 31 December
2013, the Company held investments in 19 shopping centers in Ger-
many, Austria, Poland and Hungary. The Group generates its reported
revenue from rental income on the floor space that it leases in the
shopping centers.
Due to its lean personnel structure, Deutsche EuroShop Group is cen-
trally organised. The parent company, Deutsche EuroShop AG, is
responsible for corporate strategy, portfolio and risk management,
financing and communication.
The Company’s registered office is in Hamburg. Deutsche EuroShop
is a public company under German law. The individual shopping cent-
ers are managed as separate companies and, depending on the share
of nominal capital owned, are either fully consolidated or accounted
for using the equity method. More information on indirect or direct
investments is provided in the notes to the consolidated financial
statements.
TARGETS AND STRATEGY
The management focuses on investments in high-quality shopping
centers in city centers and established locations offering stable long-
term value growth. Another key investment target is the generation
of high surplus liquidity from long-term leases in shopping centers,
which is paid out to shareholders in the form of an annual dividend.
In order to achieve these targets, the Company invests its capital in
shopping centers in different European regions in accordance with
the principle of risk diversification. Germany is the main focus for
investment. Indexed and turnover-linked commercial rent ensure that
we achieve our high earnings targets.
The Company may invest up to 10% of equity in joint ventures in shop-
ping center projects in the early stages of development.
New investments should be financed from a balanced range of
sources, and external financing may not exceed 55% of long-term
Group liabilities. As a general rule, long-term interest rates are fixed
when loans are taken out or renewed. The aim is to keep duration (i.e.
average fixed interest rate period) at over five years.
HIGH-YIELD, STABLE PORTFOLIO
Deutsche EuroShop has a balanced and diversified portfolio of Ger-
man and European shopping centers. The management focuses on
investments in prime locations in cities with a catchment of at least
300,000 in order to maintain a high level of investment security.
SEIZING OPPORTUNITIES AND MAXIMISING VALUE
In line with our buy&hold strategy, the management is increasingly
concentrating on shopping center quality and returns rather than
rapid portfolio growth. The management constantly monitors the
market and takes opportunities to buy when they arise. Rapid deci-
sion-making processes and considerable flexibility regarding poten-
tial investments and financing structures allows Deutsche EuroShop
to react to all competitive situations. At the same time, the Group’s
management is committed to optimising the value of the existing port-
folio of properties.
TAILORED RENT STRUCTURE
One key component of the rental model is a tailored rent structure.
While city center property owners often focus on obtaining the highest
possible rental rates for their properties – creating a monolithic retail
offering – Deutsche EuroShop’s management uses a calculation com-
bining a range of factors to create an attractive sector mix and opti-
mise long-term rental income. Rental partners pay sector-specific
and turnover-linked rent. When the economy is weak, Deutsche
EuroShop’s revenue is protected from falling below a lower threshold
(based on the consumer price index).
SHOPPING EXPERIENCE CONCEPT
Deutsche EuroShop has outsourced center management to an expe-
rienced external partner: ECE Projektmanagement GmbH&Co. KG
(ECE), based in Hamburg. ECE has been designing, planning, building,
renting and managing shopping centers since 1965. The company is
currently the European market leader, with 189 shopping centers
under management. Deutsche EuroShop views professional center
management as the key to successful shopping centers. In addition to
guaranteeing standard opening hours and a friendly, bright, safe and
clean environment, the center management can employ unusual dis-
plays, promotions and exhibitions to make shopping an experience.
Between 500,000 and 600,000 shoppers come to the 19 DES centers
every day, where they are impressed not only by the range of sectors
represented, but also by promotional activities including car, talent
and fashion shows and a wide range of activities for children. As a
result, the shopping centers become market places where there is
always something new on offer.

119
MANAGEMENT SYSTEM, RESEARCH AND
DEVELOPMENT
The Executive Board of Deutsche EuroShop manages the Company in
accordance with the provisions of German company law and with its
rules of procedure. The Executive Board’s duties, responsibilities and
business procedures are laid down in its rules of procedure and in its
schedule of responsibilities.
The management indicators are based on the targets of having shop-
ping centers with sustainable and stable value growth and a high
liquidity surplus generated by long-term leases. The indicators are
revenue, EBT excluding valuation gains/losses and FFO.
The Supervisory Board supervises and advises the Executive Board
in its management activities in accordance with the provisions of Ger-
man company law and the rules of procedure. It appoints the mem-
bers of the Executive Board and significant transactions by the Exec-
utive Board are subject to its approval. The Supervisory Board
comprises nine members, all of whom are elected by the Annual
General Meeting.
Members of the Executive Board are appointed and dismissed on the
basis of sections 84 and 85 of the Aktiengesetz (AktG – German Public
Companies Act). Changes to the Articles of Association are made in
accordance with sections 179 and 133 of the AktG. The Supervisory
Board is also authorised to amend the Articles of Association in line
with new legal provisions that become binding on the Company, as well
as to resolve changes to the Articles of Association that only relate to
the wording without a resolution of the Annual General Meeting.
More information about the Executive Board and the Supervisory
Board can be found in the declaration on corporate governance.
A research and development (R&D) report is not required as part of
the Management Report because Deutsche EuroShop does not need
or pursue any research and development in connection with its pri-
mary business.
Economic review
MACROECONOMIC AND SECTOR-SPECIFIC
CONDITIONS
Germany’s gross domestic product (GDP) rose by 0.4% in 2013,
according to the German Federal Statistical Office’s calculations. The
German economy continued to benefit from strong foreign trade and
stable domestic demand. The labour market remained strong in the
year under review. On average, 2.95 million people were registered
as unemployed during the year, putting the unemployment rate at
6.9%. Consumer prices in Germany rose by an average of 1.5% versus
2012. Domestic demand was mainly driven by private household
spending, which rose for the third year in a row.
In 2013, gross pay per employee rose by 1.3% according to the German
Federal Statistical Office. In an environment marked by high employ-
ment and low interest rates, the propensity to consume continued to
rise, and the savings rate dropped to 10.0% of disposable income in
2013 (2012: 10.3%). The last time the savings rate was lower was in
2001 (9.5%). Private consumer spending, which accounted for 57.5% of
GDP, rose by a nominal 2.5% in 2013 (real: +0.9%). We anticipate a
similar trend in 2014. The federal government forecasts that the Ger-
man economy will grow by 1.8% in 2014.
According to provisional calculations from the German Federal Sta-
tistical Office, German retail sales posted nominal growth of 1.4% and
real growth of 0.1% year-on-year. The German Retail Federation
(HDE) forecasts that retail sales will increase by 1.5% in Germany in
2014. After price adjustments, this amounts to a stagnation, with
prices on a par with 2013.
The expansion of online trading remains the main focus of attention in
terms of sales growth in the stationary retail sector. According to fig-
ures from the German Retail Federation (HDE), online sales grew a
further above-average 12% to around €33.1 billion. HDE anticipates
that online sales will continue to climb in 2014, rising to €38.7 billion –
an increase of approximately 17% year-on-year. Competition with
online retailers is already intensifying in some sectors. For example,
online transactions accounted for well over one quarter of total Christ-
mas sales from consumer electronics, toys and books in 2013.

120
Since disposable income growth is muted or stagnant, there is very
limited scope for sales growth in the stationary retail sector. As many
customers see leisure and the experience as important factors when
shopping, more floor space will need to be dedicated to staging shop-
ping experiences than to the straight sale of goods. With ancillary
costs rising, notably with the increased renewable energy levy (EEG),
retailer margins will come under further pressure. Meanwhile, invest-
ments are expected to deliver ever-higher returns.
The centers’ competitive position is determined both by business in
the relevant city centers and – in the case of the Billstedt-Center Ham-
burg and the Herold-Center in Norderstedt – by the presence of other
shopping centers in neighbouring districts of Hamburg. The city
center locations also have to compete with other regional centers. For
example, the city centers of Dortmund, Mannheim and Braunschweig
are serious rivals to the Allee-Center in Hamm, the Rhein-Neckar-
Zentrum in Viernheim and the City-Galerie in Wolfsburg, respectively.
There is additional competition for city center retail in the form of
growing numbers of factory and designer outlets on greenfield sites
outside the city limits. Development projects are currently underway
for new outlet centers close to the Hamm and Dessau centers, while
an existing outlet complex in Wolfsburg is being extended.
RETAIL SECTOR
Based on calculations from Jones Lang LaSalle, rental turnover on
retail spaces leased in Germany in 2013 decreased by 17% to
492,000m2
. Rental spaces in excess of 1,000m2
accounted for 12% of
rental contracts. Demand for smaller retail premises of under 250m2
remained high, accounting for 53% of all leases.
With 39% of rented floor space, textile retailers were the most sig-
nificant demand group. General clothing and women’s clothing were
the dominant segments within this group. Second place went to the
catering and food industry at 21%; health and beauty took third place
with 12%.
REAL ESTATE MARKET
Transaction volumes rose by 21% to €30.7 billion according to figures
from Jones Lang LaSalle, meaning that Germany’s commercial real
estate investment market continued to grow in 2013. Retail real
estate accounted for just under 26% of transactions. Investments in
German shopping centers totalled €2.8 billion in 2013. This came
close to the €3.0 billion posted in 2012, but does not reflect demand,
which far exceeded the range of suitable properties available for sale.
More than one third of all commercial real estate investment in euros
went into shopping centers in 2013, compared with 40% in 2012.
As real estate investors continued to focus on security in 2013, top
returns on shopping center investments remained at record-high lev-
els in Germany. According to figures from Jones Lang LaSalle, top
returns came in at 4.70% in 2013, down slightly year-on-year (4.75%).
SHARE PRICE PERFORMANCE
Deutsche EuroShop shares started the year at €31.64. In the first four
months, share prices hovered between €30.50 and €32.00 before
reaching a new record-high in mid-May, with an Xetra closing price of
€34.48 on 20 May 2013. Stock markets then lost ground and Deutsche
EuroShop shares dropped down to €29.45 on 24 June. The share price
hit a year-to-date low shortly after the dividend distribution. In the
ensuing weeks, share prices moved within a slightly broader range of
€30.50 to €33.20. The share price closed the year up at €31.83, which
represented a gain of 4.5% including dividends (2012: +32.7%).
EVALUATION OF THE FINANCIAL YEAR
The Executive Board of Deutsche EuroShop is satisfied with the past
financial year. Growth was boosted by the acquisition of the Herold-
Center in Norderstedt on 1 January 2013. The acquisition of third-
party interests in the Altmarkt-Galerie in Dresden on 1 May 2013 also
pushed up earnings.
In May 2013, we adjusted the forecasts published in the Annual Report
2012. Target revenue was revised to between €186 million and
€189 million and came in at €188.0 million (2012: €178.2 million) on
the reporting date, corresponding to an increase of 5.5%. Earnings
before interest and taxes (EBIT) were forecast at between €162 million
and €165 million, and actual EBIT was slightly above both the forecast
range and the 2012 results at €165.8 million, an improvement of 9.4%
(2012: €151.6 million). We expected earnings before taxes (EBT)
excluding valuation gains/losses (including at-equity investments) of
€113 to €116 million. At €129.2 million, EBT came in well above the
forecast range, due to €15.8 million in exceptional proceeds from
sales, representing an improvement of 41% year-on-year (2012:
€95.1 million). Funds from operations (FFO) also exceeded the fore-
cast, coming in at €2.08 per share (forecast: €1.99 to €2.03 per share).
Deutsche EuroShop has therefore proven once again that it has an
outstanding shopping center portfolio and is well positioned.

121
COURSE OF BUSINESS
As reported on previous occasions, the amendments to the Inter-
national Accounting Standards regarding the permissibility of propor-
tional consolidation of our joint ventures have been approved, but the
changes only became mandatory as at 2014. Nevertheless, as previ-
ously announced, we have chosen to recognise these companies
using the equity method from 1 January 2013 pursuant to IAS 31.
Consequently, the share in the revenue and costs of these companies
will no longer be included in the consolidated financial statements.
Instead, only the at-equity earnings of these shopping centers will be
reported under net finance costs. The change will affect four joint
ventures previously reported using the proportional method.
The change in the accounting method has entailed a restatement of
the 2012 annual financial statements, which also affects the figures
provided by way of comparison in this report. Details of the changes
to the 2012 consolidated financial statements can be found in the
notes (changes in accounting policies).
In addition, Stadt-Galerie Passau KG and Immobilien KG FEZ Harburg –
which were previously included in the consolidated financial state-
ments under a voting agreement – are now recognised as at-equity
joint ventures from 1 January 2013. The voting agreements were ter-
minated by mutual agreement at the end of 2012.
FINANCIAL POSITION
Deutsche EuroShop can look back on another successful financial
year. Revenue and profit advanced significantly versus 2012. The
acquisition of the Herold-Center in Norderstedt on 1 January 2013
boosted earnings considerably, as did the sale of our one-third inter-
est in Galeria Dominikanska in Breslau. The acquisition of third-party
interests in Altmarkt-Galerie Dresden and the subsequent consolida-
tion of the center have also allowed us to optimise the Group’s legal
structure.
Net assets and our financial structure remain solid. Favourable refi-
nancing arrangements have made a positive contribution to earnings.
Revenue rose by 5.5% to €188.0 million, while consolidated profit
came to €171.0 million (2012: €122.5). Earnings per share came in at
€3.17 compared with €2.36 in 2012. Operating profit per share
advanced 28% from €1.36 to €1.74.
Valuation gains improved considerably in 2013 to €56.0 million, up
from €13.9 million in 2012. The valuation gains on equity-accounted
joint ventures came to €2.4 million, up €8.4 million versus 2012
(€–6.0 million). Earnings before tax climbed around 36% year-on-year
to €129.2 million (2012: €95.1 million). After adjustments for the pro-
ceeds of the sale of the interest in Ilwro Sp.zo.o (Galeria Dominikan-
ska) totalling €15.8 million, earnings before tax were up around 19%
at €113.4 million.
The EPRA net asset value per share rose by 7.2% from €28.53 to
€30.59.
RESULTS OF OPERATIONS
Revenue in the German retail trade (excluding the vehicle trade) rose
by a nominal 1.4% over the reporting year, while the revenue of the
tenants in our German shopping centers slipped 0.1%. In contrast,
tenants in foreign properties posted revenue growth of 3.3%.
CONSOLIDATED REVENUE UP 5.5%
Consolidated revenue was up 5.5%, from €178.2 million to €188.0 mil-
lion, in the financial year. The Herold-Center in Norderstedt, which was
acquired on 1 January 2013, and the Altmarkt-Galerie Dresden, which
was fully consolidated from 1 May 2013, contributed significantly to
revenue growth. Meanwhile, revenue from the Stadt-Galerie in Passau
and the Phoenix-Center in Hamburg are no longer recognised due to
the switch to at-equity reporting in the year under review. These two
properties generated revenue totalling €21.1 million in 2012.
For ten properties, the rise in revenue was largely due to index-
related rental increases. Renovation work at the Rhein-Neckar-
Zentrum and one-off effects in the A10 Center saw revenues fall
slightly. Overall, comparable revenue rose by 1.4% (1.3% in domestic,
2.4% international) on a like-for-like basis over the reporting year.
International
Domestic
188.0
2013
178.2
14.4
14.7
163.8
173.3
2012
REVENUE € MILLION
21.1
142.7

122
VACANCY RATE REMAINS STABLE AT UNDER 1%
As in previous years, the vacancy rate for retail spaces remained sta-
ble at under 1%. At €0.6 million (2012: €0.6 million) or 0.3% of revenue
(2012: 0.4%), write-downs for rent losses remained at a very low
level.
INCREASE IN PROPERTY OPERATING AND
ADMINISTRATIVE COSTS
Property operating costs were down €1.5 million year-on-year at
€8.5 million (2012: €10.0 million), while property administrative costs
increased by €0.8 million to €9.3 million (2012: €8.5 million). The
lower property operating costs were mainly linked to a sharp decline
in maintenance costs (down €2.6 million) in the year under review.
However, the savings were offset by higher non-allocable ancillary
costs. Property operating costs were also affected by the first-time
consolidation of certain properties in 2013 (Herold-Center from
1 January 2013 and Altmarkt-Galerie from 1 May 2013) and the
deconsolidation of other properties (Passau and Hamburg-Harburg).
Higher property administration costs were also linked to the four
properties. Overall, the cost ratio came in at 9.5% of revenue (2012:
10.4%).
OTHER OPERATING INCOME AND EXPENSES
Other operating income came to €2.8 million, slightly higher than in
the previous year (€2.7 million), while other operating expenses fell
significantly, down €3.5 million to €7.3 million (2012: €10.8 million).
The decrease resulted from an exceptional real estate transfer tax of
€2.9 million incurred in connection with the restructuring of the Group
in 2012 and lower ancillary financing costs.
MARKED IMPROVEMENT IN NET FINANCE COSTS
Net finance costs improved significantly, up €28.0 million to
€–34.1 million (2012: €–62.1 million). The improvement reflected the
proceeds of the sale of the interest in Ilwro Sp.zo.o (Galeria Domini-
kanska) amounting to €15.8 million, the effects of the new accounting
method and the first-time consolidation of the Altmarkt-Galerie in
Dresden.
31.12.2013 31.12.2012 Difference Change in %
Main-Taunus-Zentrum, Sulzbach 33,646 33,184 462 1.4
A10 Center, Wildau 20,216 20,646 -430 -2.1
Rhein-Neckar-Zentrum, Viernheim 17,382 17,654 -272 -1.5
Altmarkt-Galerie, Dresden 16,129 0 16,129
Herold-Center, Norderstedt 13,199 0 13,199
Billstedt-Center, Hamburg 11,366 11,040 326 3.0
Allee-Center, Hamm 10,194 9,975 219 2.2
City-Galerie, Wolfsburg 9,647 9,290 357 3.8
Forum, Wetzlar 9,164 8,992 172 1.9
City-Arkaden, Wuppertal 9,016 8,929 87 1.0
Rathaus-Center, Dessau 8,291 8,166 125 1.5
City-Point, Kassel 8,141 7,934 206 2.6
Stadt-Galerie, Hameln 6,891 6,889 2 0.0
Phoenix-Center, Hamburg 0 12,003 -12,003
Stadt-Galerie, Passau 0 9,101 -9,101
Total domestic 173,282 163,803 9,478 5.8
Galeria Baltycka, Danzig 14,489 14,017 472 3.4
Caspia 216 341 -125 -36.7
Total international 14,705 14,358 347 2.4
Overall total 187,987 178,161 9,825 5.5
REVENUE IN € THOUSAND

123
Interest income was on a par with the previous year at €0.4 million.
The deconsolidation of the Passau and Hamburg-Harburg centers
generated interest expenses totalling €5.8 million, which brought
interest expenses to €57.8 million – an increase of €0.5 million year-
on-year. The first-time consolidation of the Altmarkt-Galerie in Dres-
den from 1 May 2013 created an exceptional charge arising from the
derecognition of a cumulative valuation gain/loss previously recog-
nised in equity for an interest rate hedge (swap) to the value of
€6.8 million and offset by current earnings of €2.3 million from the
value of the swap up to the reporting date. The net charge arising from
the swap therefore came to €4.5 million in 2013. The interest
expenses will be offset by corresponding income until 2018.
Earnings from at-equity investments climbed considerably, up
€12.7 million to €27.0 million (2012: €14.3 million). The improvement
also reflects a marked hike in valuation gains, which were up €2.4 mil-
lion year-on-year at €8.4 million (2012: €–6.0 million). The change in
accounting methods also affected these figures.
The profit share for third-party shareholders increased by €0.6 mil-
lion from €15.3 million to €15.9 million.
CHANGES IN VALUATION GAINS/LOSSES
Valuation gains were up €42.0 million year-on-year at €56.0 million
(2012: €13.9 million). The average value of Group properties after
ongoing investments advanced 2.1%; valuation gains came in at
between 0.0% and 4.8%.
Valuation of the portfolio properties led to valuation gains of €60.5 mil-
lion. The share of valuation gains attributable to third-party share-
holders amounted to €4.5 million in the reporting year (2012:
€18.7 million).
ANOTHER SIGNIFICANT CHANGE IN TAX POSITION
Taxes on income and earnings amounted to €16.6 million compared
to tax income of €19.1 million in 2012. Deferred trade tax provisions
totalling €49.1 million were released in 2012. In 2013, deferred trade
tax provisions were reduced by a further €12.6 million when another
company met the criteria for the extended trade tax deduction. Mean-
while, allocations for deferred income taxes generated expenses of
€28.7 million during the year under review. Tax expense for income
tax payments amounted to €2.4 million (Germany: €1.5 million,
international: €0.9 million) in the year under review.
31.12.2013 31.12.2012 Difference Change in %
Allee-Center, Magdeburg 7,945 7,762 183 2.4
Phoenix-Center, Hamburg 6,144 0 -6,144 100
Stadt-Galerie, Passau 6,938 0 6,938 100
Altmarkt-Galerie, Dresden 5,636 16,096 -10,460 -65.0
City-Arkaden, Klagenfurt 5,890 5,635 255 4.5
Árkád, Pécs 3,487 3,577 -90 -2.5
Others 676 678 -2 -0.3
Revenue 36,716 33,748 2,969 8.8
Property operating costs -1,739 -1,415 -324
Property management costs -1,904 -2,079 175
Net operating income 33,073 30,253 2,820
Other operating income 65 204 -139
Other operating expenses -322 -906 584
Earnings before interest and taxes (EBIT) 32,816 29,551 3,265
Interest income 19 40 -21
Interest expense -8,147 -9,110 963
Net finance costs -8,127 -9,070 942
Valuation gains/losses 2,410 -6,029 8,439
Earnings before tax (EBT) 27,099 14,453 12,646
Taxes on income and earnings -76 -107 32
Share in the profit / loss of joint ventures 27,024 14,346 12,678
€ THOUSAND

124
SIGNIFICANT INCREASE IN CONSOLIDATED PROFIT
Earnings before interest and taxes (EBIT) climbed 9.4%, from
€151.6 million to €165.8 million, in the year under review. At
€187.6 million, earnings before taxes (EBT) were 81% higher than in
the previous year (€103.4 million) for the reasons given above. Con-
solidated profit amounted to €171.0 million, up 40% against 2012
(€122.5 million).
STRONG OPERATIONS DRIVE EARNINGS PER SHARE
Earnings per share (consolidated net profit per share) amounted to
€3.17 in the reporting year, compared with €2.36 in 2012, an increase
of 34% Of this amount, €1.74 was attributable to operations (2012:
€1.36) and €0.87 to valuation gains/losses (€0.05). Earnings per
share were also boosted by €0.27 in tax income (2012: €0.95) and
proceeds from sales at €0.29 in 2013.
165.8
2013
151.6
2012
EBIT € MILLION
Operating proﬁt Extraordinary tax eﬀect
Valuation gains/losses Extraordinary revenue
EARNINGS PER SHARE €, UNDILUTED
3.17
2013
2.36-0.170.88 1.92
2010 2011 20122009
1.18
0.54
0.73
0.95
0.29
-0.30
0.98
1.19
0.05
0.27
-1.70
1.36
1.74
0.87
2013 2012
Consolidated net profit 3.17 2.36
Valuation in accordance with IAS 40 -1.03 -0.27
Valuation gains/losses for
equity-accounted companies -0.04 0.12
Deferred taxes 0.20 0.10
Tax income from past years -0.27 -0.95
Proceeds from sales -0.29 0.00
EPRA* earnings 1.74 1.36
Weighted no. of shares in thousands 53,946 51,935
* European Public Real Estate Association
FUNDS FROM OPERATIONS (FFO) UP 24%
Funds from operations (FFO) are used to finance our ongoing invest-
ments in portfolio properties, scheduled repayments on our long-
term bank loans and the distribution of dividends. During the year
under review, FFO of €112.0 million was generated (2012: €87.0 mil-
lion). The FFO per share rose by 24% from €1.68 to €2.08.
2013 2012
Consolidated profit 171,043 122,484
Proceeds from sales -15,799 0
Valuation gains/losses -55,982 -13,934
Valuation gains/losses for
equity-accounted companies -2,410 6,029
Bond conversion expense 940 0
Deferred taxes 14,208 -27,545
FFO 112,000 87,034
FFO per share 2.08€ 1.68€
DIVIDEND PROPOSAL: €1.25 PER SHARE
Based on a successful financial year, we are able to maintain our
dividend policy, which is geared towards the long term and continuity.
The Executive Board and Supervisory Board will therefore propose to
the shareholders at the Annual General Meeting in Hamburg on
18 June 2014 that a dividend of €1.25 per share be distributed for the
financial year 2013, an increase of 4% or €0.05 year-on-year. An esti-
mated €0.40 per share of the dividend will be deductible as capital
gains tax.
€ PER SHARE
€ THOUSAND

125
FINANCIAL POSITION
PRINCIPLES AND OBJECTIVES OF FINANCIAL MANAGEMENT
For the purposes of financing its investments, Deutsche EuroShop
uses the stock exchange to raise equity, as well as the credit and
capital markets to borrow funds. Within the Group, both the individual
property companies and Deutsche EuroShop AG borrow from banks
and serve as bond issuers. Deutsche EuroShop’s credit standing has
been shown to be advantageous when negotiating loan terms. The
Group can also arrange its financing independently and flexibly.
Loans and bonds are taken out in euros for all Group companies. In
general, the use of equity and loans for investments should be equally
weighted and the equity ratio in the Group (including third-party inter-
ests) should not fall significantly below 45%.
We finance our real estate projects on a long-term basis and also use
derivative financial instruments to hedge against rising capital mar-
ket rates. Hedging transactions are used to hedge individual loans. An
available credit line enables Deutsche EuroShop to react quickly to
investment opportunities. Any cash not needed is invested in time
deposits for the short term until it is used for investments, to finance
ongoing costs or to pay dividends.
FINANCING ANALYSIS: IMPROVED INTEREST RATE
CONDITIONS
As at 31 December 2013, Deutsche EuroShop Group reported the
following key financial data:
2013 2012 Change
Total assets 3,394.9 3,347.6 +47.3
Equity (including third-
party interests) 1,642.4 1,606.1 +36.3
Equity ratio (%) 48.4 48.0 0.4
Net financial liabilities 1,445.9 1,306.6 +139.3
Loan to value ratio (%) 43 41 2
At €1,642.4 million, the Group’s economic equity capital, which com-
prises the equity of the Group shareholders (€1,428.9 million) and the
equity of the third-party shareholders (€213.4 million), was €36.3 mil-
lion higher than in the previous year. At 48.4%, the equity ratio was up
slightly year-on-year.
€ MILLION
2013 2012
Convertible bond 93,556 91,943
Non-current bank loans and overdrafts 1,295,996 1,184,360
Current bank loans and overdrafts 97,207 191,298
Total 1,486,759 1,467,601
Cash and cash equivalents -40,810 -161,006
Net financial liabilities 1,445,949 1,306,595
Current and non-current financial liabilities rose from €1,467.6 million
to €1,486.8 million in the year under review, an increase of €19.2 mil-
lion. At the same time, cash and cash equivalents dropped €120.2 mil-
lion, pushing net financial liabilities up €139.4 million, from
€1,306.6 million to €1,445.9 million. Following the takeover of the
Altmarkt-Galerie Dresden and its subsequent consolidation, financial
liabilities added €187.1 million, while loans amounting to €109.9 mil-
lion were deconsolidated. Meanwhile, loans amounting to €59.7 million
were repaid.
During the year under review, 13 existing loans taken out to finance
the Main-Taunus-Zentrum were replaced by a new loan in the amount
of €220.0 million. Whereas the average residual maturity when the
loans were replaced was 0.9 years with average interest at 3.88%, the
new loan was taken out for 10 years at an interest rate of 2.99%. As a
result, we have again significantly improved the maturity and interest
rate structure of our loan portfolio.
The net financial liabilities existing at the end of the year are used
exclusively to finance non-current assets. As a result, 43% of non-
current assets were financed by loans in the year under review.
The Group has access to a credit line in the amount of €150 million
until end-2016. As at the balance sheet date, €77.0 million had been
drawn down.
Net debt finance terms (including the convertible bond) as at
31 December 2013 remained fixed at 3.88% p.a. (2012: 4.25% p.a.) for
an average residual maturity of 7.0 years (6.4 years). Deutsche
EuroShop maintains credit facilities with 21 banks, all of which are
German banks.
FINANCIAL LIABILITIES
IN € THOUSAND

126
Of 19 loans across the Group, 12 are subject to credit covenants with
the financing banks. This includes a total of 18 different covenants on
debt service cover ratios (DSCRs), interest cover ratios (ICRs), changes
in rental income and the loan to value ratio (LTV). All conditions were
met. Based on the budgeted figures, compliance with the covenants
may also be assumed in the current financial year.
Scheduled repayments amounting to €18.2 million will be made from
current cash flow during the 2014 financial year. Over the period from
2015 to 2018, average annual repayments will be around €17.0 million.
No loans are due to expire in 2014. One loan in the amount of €61.9
million is due for renewal in 2015 and another €77.0 million loan is
due for renewal in 2016. The convertible bond must be repaid in 2017
if the bond holders have not made use of their conversion rights by
then. Another loan in the amount of €72.0 million is due for renewal
in 2018.
Short and long-term financial liabilities totalling €1,486.8 million
were recognised in the balance sheet at the reporting date. The dif-
ference between the total and the amounts stated here is €3.7 million,
which relates to deferred interest and repayment obligations that
were settled at the beginning of 2014.
INVESTMENT ANALYSIS: INVESTMENTS ABOVE PREVIOUS
YEAR’S LEVEL
Investments made during the 2013 financial year amounted to
€89.4 million, compared with €197.4 million in the previous year. After
adjustments for cash and cash equivalents acquired, the consolida-
tion of Altmarkt-Galerie Dresden contributed €59.4 million. Ongoing
investments in portfolio properties amounted to €18.1 million. Other
investments came to €1.1 million.
AS % OF LOAN € MILLION
AVERAGE
RESIDUAL
MATURITY (YRS)
AVERAGE
INTEREST RATE
Up to 1 year 6.4 95.2 1.0 1.67
1 to 5 years 25.2 372.5 3.4 3.88
5 to 10 years 62.3 924.4 7.9 3.72
Over 10 years 6.1 91.0 13.7 5.07
Total 100.0 1,483.1 7.0 3.88
LOAN STRUCTURE AS AT 31 DECEMBER 2013
LIQUIDITY ANALYSIS: HIGHER LIQUIDITY DUE TO FINANCING
The Group’s operating cash flow of €129.8 million (2012: €99.8 mil-
lion) comprises the amount generated by the Group for shareholders
through the leasing of shopping center floor space after deduction of
all costs. It primarily serves to finance the dividends of Deutsche
EuroShop AG and payments to third-party shareholders.
Cash flow from operating activities amounted to €99.3 million (2012:
€121.9 million) and comprises operating cash flow and changes in
receivables, other assets, other liabilities and provisions. The decline
was primarily due to the payment of tax liabilities.
Cash flow from financing activities fell from €178.9 million to
€–136.8 million. Cash outflows from financial liabilities totalling
€59.7 million essentially reflected the repayment of a credit line used
in 2012. Dividends paid to shareholders totalled €64.7 million. Divi-
dend payments to third-party shareholders came to €12.3 million.
Cash and cash equivalents dropped by €120.2 million in the year
under review to €40.8 million (2012: €161.0 million).

127
NET ASSETS
BALANCE SHEET ANALYSIS
The Group’s total assets increased by €47.3 million from €3,347.6 mil-
lion to €3,394.9 million.
2013 2012 Change
Current assets 55,698 171,160 -115,462
Non-current assets 3,339,165 3,176,400 162,765
Current liabilities 123,353 241,958 -118,605
Non-current liabilities 1,842,561 1,783,688 58,873
Equity 1,428,949 1,321,914 107,035
Total assets 3,394,863 3,347,560 47,303
MARKED DROP IN CURRENT ASSETS
At the end of the year, current assets amounted to €55.7 million, down
€115.5 million compared to the previous year (2012: €171.2 million).
The reduction was exclusively due to lower cash and cash equivalents
as at the reporting date. By contrast, trade receivables advanced
€1.8 million year-on-year to €5.6 million (€3.8 million). Other assets
slipped €0.1 million, from €6.4 million to €6.3 million.
€ THOUSAND
Non-current assets Non-current liabilities
Equity
Current assets Current liabilities
Any inconsistencies in the total
are due to rounding
3,394.9 3,394.9
2013 2013
3,347.6 3,347.6
171.2
242.0
3,339.2
1,842.6
1,428.9
3,176.4
1,783.7
55.7
123.4
2012 2012
BALANCE SHEET STRUCTURE € MILLION
ASSETS LIABILITIES
1,321.9
Cash and cash equivalents amounted to €40.8 million on the reporting
date, down €120.2 million year-on-year (€161.0 million). There was
also a time deposit as at the balance sheet date, which was recog-
nised under other financial investments.
NON-CURRENT ASSETS INCREASED AS A RESULT OF
INVESTMENT
Non-current assets rose by €162.8 million, from €3,176.4 million to
€3,339.2 million, in the year under review.
Investment properties gained €138.0 million. The Altmarkt-Galerie
contributed €392.7 million, which was offset by cash disposals total-
ling €333.4 million from the deconsolidation of the Passau and
Hamburg-Harburg properties. Costs of investments in portfolio prop-
erties amounted to €18.1 million. The revaluation of our property
portfolio resulted in valuation gains of €60.5 million.
At-equity investments increased by €20.4 million from €321.5 million
to €341.9 million. The recognition of the Passau and Hamburg-Har-
burg investments generated an addition of €148.9 million, which was
offset by a €134.6 million reduction due to the first-time consolidation
of Altmarkt-Galerie from 1 May 2013. The difference between the
share in the earnings and losses resulted in a €6.1 million gain in at-
equity investments.
Other non-current assets increased by €4.4 million net versus 2012.
CURRENT LIABILITIES DOWN
Current liabilities fell by €118.6 million, from €242.0 million to
€123.4 million, largely due to lower short-term bank loans and liabil-
ities (down €94.1 million) and a decline in tax liabilities (down
€23.2 million).
Other current liabilities declined €1.3 million in net terms.
NON-CURRENT LIABILITIES UP DUE TO FINANCING
Non-current liabilities rose by €58.9 million, from €1,783.7 million to
€1,842.6 million. The increase was essentially driven by the first-time
consolidation of Altmarkt-Galerie Dresden and deconsolidations
(€73.7 million). Non-current liabilities advanced €113.3 million in
total. Deferred tax liabilities also rose, up €18.0 million to €198.5 mil-
lion. At €213.4 million, third-party interests in the equity of the prop-
erty companies was up €70.8 million year-on-year due to deconsoli-
dations. Other liabilities slipped €1.6 million to €41.1 million (2012:
€42.7 million), largely due to interest rate swap measurements.

128
EQUITY
At €1,428.9 million, Group equity was up €107.0 million against the
previous year (€1,321.9 million).
The change in equity over the year under review primarily comprises
the difference between consolidated profit at €171.0 million and the
€64.7 million paid as a dividend in June 2013.
EPRA NET ASSET VALUE FURTHER INCREASED
Net asset value (NAV) amounted to €1,650.4 million or €30.59 per
share as at 31 December 2013, compared with €1,538.9 million or
€28.53 per share in 2012. Net asset value per share was therefore
7.2% higher year-on-year.
31.12.2013 31.12.2012
Equity 1,428,949 1,321,914
Deferred taxes 198,491 180,525
Negative swap values 30,760 49,496
Resulting deferred taxes -7,762 -13,057
EPRA NAV 1,650,438 1,538,878
EPRA NAV per share 30.59€ 28.53€
EPRA also recommends that an EPRA NNNAV (triple NAV) be calcu-
lated, which should roughly correspond to the liquidation value of the
company. This adjusts the EPRA NAV to take account of hidden liabil-
ities or undisclosed reserves resulting from the market valuation of
bank loans and overdrafts, as well as deferred taxes. As at 31 Decem-
ber 2013, EPRA NNNAV amounted to €1,377.7 million, compared with
€1,250.3 million in 2012. EPRA NNNAV per share was therefore
€25.54 (2012: €23.18), which corresponds to an increase of 10.2%.
€ THOUSAND
NET ASSET VALUE PER SHARE €
*EPRA NAV
20132010 2011 20122009
30.59*
28.53*27.64*
26.36*26.63
31.12.2013 31.12.2012
EPRA NAV 1,650,438 1,538,878
Negative swap values -30,760 -49,496
Negative present value of bank loans
and overdrafts -62,862 -89,522
Total deferred taxes -179,080 -149,607
EPRA NNNAV 1,377,736 1,250,253
EPRA NNNAV per share 25.54€ 23.18€
OVERALL COMMENT BY THE EXECUTIVE BOARD ON THE
ECONOMIC SITUATION
The past financial year confirmed that Deutsche EuroShop Group has
a successful business model. We have again managed to meet our
original expectations.
Report on events after
the balance sheet date
No further significant events occurred between the balance sheet date
and the date of preparation of the consolidated financial statements.
Outlook
The economic review produced by the federal government predicts
positive growth for Germany in 2014, although economic imbalances
are expected to persist within the eurozone. Gross domestic product
(GDP) is forecast to grow by 1.8%. Growth is likely to be driven by
sustained strong domestic demand and a sharp rise in exports. The
unemployment rate is set to remain at the current level while inflation
will be modest. Economic activity could rise slightly – to 42.1 million
in employment – and salaries may increase slightly. The German Retail
Federation (HDE) predicts that retail sales will advance by 1.1%.
The Stability and Growth Pact adopted by the EU member states in
2012 and associated debt brake have essentially eliminated govern-
ment investment in some countries, meaning that no significant
growth is expected in the foreseeable future in southern EU member
states.
The global economy remains very delicate. Although the financial
market turbulence experienced in 2013 has largely abated, many
market participants and the general population are not yet convinced
that the crisis is over.
€ THOUSAND

129
Consequently, global demand for capital investments that retain their
value remains strong, particularly in financially strong countries such
as Germany. With interest rates low, life insurance companies in par-
ticular are still seeking real estate investment opportunities that will
meet the long-term expectations of policyholders. This is keeping
demand for real estate at record levels, in contrast to a merely limited
supply side. Retail property in particular remains attractive to many
institutional investors, leading to very high transaction prices and cor-
respondingly low anticipated returns for core properties. We monitor
developments on the real estate market closely. As in the past, we will
only make new investments if the return that is achievable over the
long term bears a reasonable relation to the investment risks.
OUTLOOK GOOD FOR OUR SHOPPING CENTERS
We predict that our shopping centers will continue to perform well.
The occupancy rate across all our shopping centers is currently
expected to remain at around 99%. At the end of 2013, the occupancy
rate for all types of space was 98.6%, on a par with 2012 (98.6%). The
occupancy rate for retail space stood steady at 99.5%. The remaining
vacancies consisted largely of office and storage space.
Outstanding rents and necessary valuation allowances remain stable
at a low level. We see no sign of a significant change in this satisfac-
tory situation.
AGREED TRANSACTIONS ARE THE FOUNDATION FOR
REVENUE AND EARNINGS PLANNING
The Deutsche EuroShop Group’s revenue and earnings planning for
2014 and 2015 does not include the purchase or sale of any proper-
ties. The results of the annual valuation of our shopping centers and
exchange rate factors are not included in our planning since they are
not foreseeable.
Forecasts about the future revenue and earnings situation of our
Group are based on the following factors:
a) the development of revenue and earnings in the existing shopping
centers
b) the assumption that there will be no substantial reduction in sales
in the retail sector that would prevent a large number of retailers
from meeting their obligations under existing leases.
REVENUE SET TO RISE BY 6% IN 2014
We anticipate that revenue will increase by around 6% to between
€198 and €201 million in the 2014 financial year. The figures will be
boosted by revenue from the Altmarkt-Galerie, which will be included
in the full-year figures for the first time. In the 2015 financial year,
revenue is likely to rise slightly to between €202 million and
€205 million.
FURTHER GROWTH IN EARNINGS IN THE NEXT TWO YEARS
Earnings before interest and taxes (EBIT) amounted to €165.8 million
in 2013. According to our forecast, EBIT will come in at between
€174 million and €177 million (up 6%) in the current financial year.
EBIT should increase again to between €177 million and €180 million
in 2015 (up 2%).
Earnings before tax after adjustments for the exceptional proceeds
from the sale of Galeria Dominikanska in Breslau (EBT excluding
valuation gains) came to €113.4 million. We expect to achieve EBT of
between €120 million and €123 million in 2014 (an increase of 7%)
and €125 to €128 million in 2015 (up 4%).
FFO UP SLIGHTLY
Funds from operations (FFO) amounted to €2.08 per share in the year
under review. We expect this figure to come to between €2.14 and
€2.18 in 2014 (+4%) and between €2.20 and €2.24 (+3%) in 2015.
DIVIDEND POLICY
We intend to maintain our long-term, reliable dividend policy and
anticipate that we will be able to pay dividends at €1.30 per share in
2014 and €1.35 in 2015 to our shareholders.
REVENUE € MILLION EBIT € MILLION EBT € MILLION
excluding valuation
FFO €
per share
2013 2014 2015
Earnings
188.0
Target
198–201
Target
202–205
2013 2013 20132014 2014 20142015 2015 2015
Earnings
165.8
Earnings
113.4
Earnings
2.07
Target
174–177 Target
120–123
Target
2.14–2.18
Target
177–180 Target
125–128
Target
2.20–2.24
* Adjusted for sale proceeds

130
Risk report
PRINCIPLES GOVERNING THE RISK MANAGEMENT
SYSTEM AND GROUP-WIDE INTERNAL CONTROL
SYSTEM
Deutsche EuroShop’s strategy is geared towards maintaining and
sustainably increasing shareholders’ assets and generating sustain-
ably high surplus liquidity from leasing real estate, thereby ensuring
that the shareholders can share in the success of the company over
the long term through the distribution of a reasonable dividend. The
focus of the risk management system is therefore on monitoring com-
pliance with this strategy and, building on this, the identification and
assessment of risks and opportunities as well as the fundamental
decision on how to manage these risks. Risk management ensures
that risks are identified at an early stage and can then be evaluated,
communicated promptly and mitigated. Monitoring and management
of the risks identified are the focus of the internal control system,
which at Group level is essentially the responsibility of the Executive
Board. The internal control system is an integral part of the risk man-
agement system.
Within the framework of their legal mandate for auditing the annual
financial statements, the auditor checks whether the early warning
system for risks is suitable for detecting at an early stage any risks
or developments that might endanger the Company.
Risk analysis involves the identification and analysis of factors that
may jeopardise the achievement of objectives. The risk analysis pro-
cess answers the question of how to deal with risks given ongoing
changes in the environment, the legal framework and working condi-
tions. The resulting control activities are to be embedded into pro-
cesses that are essential to the realisation of business targets.
KEY FEATURES
Under existing service contracts, the Executive Board of Deutsche
EuroShop AG is continuously briefed about the business performance
of individual property companies. Financial statements and financial
control reports are submitted on a quarterly basis for each shopping
center, with medium-term corporate plans submitted annually. The
Executive Board regularly reviews and analyses these reports, using
the following information in particular to assess the level of risk:
1. Existing properties
• Trends in accounts receivable
• Trends in occupancy rates
• Retail sales trends in the shopping centers
• Variance against projected income from the properties
2. Centers under construction
• Pre-leasing levels
• Construction status
• Budget status
In accordance with IFRS 8.12, segment reporting is presented as a
geographical breakdown: domestic and international.
Risks are identified by observing issues and changes that deviate
from the original plans and budgets. The systematic analysis of eco-
nomic data such as consumer confidence and retail sales trends is
also incorporated into risk management. The activities of competitors
are also monitored continually.
FINANCIAL STATEMENT PREPARATION PROCESS
Preparation of the financial statements is a further important part of
the internal control system and is monitored and controlled at the
level of the Group holding company. Internal regulations and guide-
lines ensure the conformity of the annual financial statements and the
consolidated financial statements.
The decentralised preparation of Group-relevant reports by the ser-
vice provider is followed by the aggregation and consolidation of the
individual annual financial statements and the preparation of the
information for reporting in the notes and Management Report in the
accounting department of the holding company with the aid of the
consolidation software Conmezzo. This is accompanied by manual
process controls such as the principle of dual control by the employ-
ees charged with ensuring the regularity of financial reporting and by
the Executive Board. In addition, within the scope of the auditing activ-
ities, the auditor of the consolidated financial statements performs
process-independent auditing work, also with respect to financial
reporting.

131
ADVICE ON LIMITATIONS
By virtue of the organisational, control and monitoring measures laid
down in the Group, the internal control and risk management system
enables the full recording, processing and evaluation of Company-
related facts as well as their proper presentation in Group financial
reporting.
Decisions based on personal judgment, flawed controls, criminal acts
or other circumstances cannot be entirely ruled out, however, and
may limit the effectiveness and reliability of the internal control and
risk management system that is in use such that the application of the
systems used cannot guarantee absolute certainty in respect of the
correct, complete and timely recording of facts in Group financial
reporting.
The statements made relate solely to those subsidiaries included in
the consolidated financial statements of Deutsche EuroShop for
which Deutsche EuroShop is in a position, directly or indirectly, to
dictate their financial and operating policies.
PRESENTATION OF MATERIAL INDIVIDUAL RISKS
CYCLICAL AND MACROECONOMIC RISKS
The German economy posted moderate growth in 2013. According to
data published by the German Federal Statistical Office, GDP rose by
0.4% after price, seasonal and calendar adjustments (2012: 0.7%).
Strong experts and robust domestic demand were the main growth
drivers. The federal government forecasts GDP growth of 1.8% in Ger-
many in 2014.
The labour market remained relatively strong. Employment was at a
record high of 42.0 million. The annual average unemployment rate
for the active population was 6.9% in 2013 (2012: 6.8%). The unem-
ployment rate is expected to fall slightly in 2014.
In contrast, gross domestic product (GDP) in the eurozone fell by 0.4%.
However, economic developments varied considerably from one EU
member state to another. Southern European countries are still strug-
gling with high debt-to-GDP ratios and a lack of competitiveness. To
date, they have been unable to reduce debt levels significantly. Unem-
ployment is at a record high of 12% in the eurozone. At around 50%,
youth unemployment in countries such as Greece and Spain is par-
ticularly worrying. However, the eurozone economy should pick up in
2014 – the World Bank forecasts that economic output will rise by
1.1%.
Inflation slowed year-on-year in 2013. Germany and the eurozone
posted identical inflation rates: 1.5%. Energy and food prices remained
the main price drivers.
Economic imbalances within the eurozone will persist. The Stability
and Growth Pact adopted by the EU member states in 2012 and asso-
ciated debt brake have essentially eliminated government investment,
meaning that no significant growth is expected in the foreseeable
future in southern EU member states.
Deutsche EuroShop AG is not as strongly affected by short-term eco-
nomic developments as other sectors are in terms of its business
model – long-term, inflation-proofed leasing of retail space – and the
associated risks. However, in light of the sovereign debt crisis, we
cannot rule out the possibility of a change in economic conditions that
would impact Deutsche EuroShop AG’s business.
Past experience has demonstrated that by locating our shopping cent-
ers in prime locations and by ensuring broad sector diversification
within the centers, we can achieve commercial success even under
difficult economic conditions.
MARKET AND SECTOR RISKS
There has been a structural change in retail trade in recent years,
caused by shifts in demand patterns and new product formats. The
greatest success has been enjoyed by large-scale retail operations
that are able to offer customers a wide range of goods. Thanks to its
business model, Deutsche EuroShop is in a position to benefit from
this development, especially as the experience aspect of shopping has
gained in importance and a trend towards shopping as a recreational
and lifestyle activity has become apparent.
Revenue in the stationary retail sector saw nominal growth of 1.4%
and 0.1% in real terms (2012: 1.9% nominal growth; down 0.3% in real
terms). The German Retail Federation (HDE) predicts nominal retail
sales growth of 1.5% to €439.7 billion in 2014.
The Internet and online trading are now established economic factors.
Stationary retailers need to address the issues and challenges that
this situation has created. The growth and success of e-commerce
will result in a gradual structural change within stationary retail as
retailers respond with different pricing models, special promotional
offers and particularly by building up their own online presence. How-
ever, in the medium term, retailers will need to reconsider their net-
work of locations. Properties in prime locations could benefit from
this development.

132
Online trading advanced 12% to €33.1 billion in 2013. The German Retail
Federation anticipates a further 17% rise in 2014 to €38.7 billion.
We minimise market and sector risks by closely monitoring the mar-
ket and by concluding long-term contracts with tenants with strong
credit ratings in all retail segments.
Deutsche EuroShop AG is not as strongly affected by short-term eco-
nomic developments as other sectors are in terms of its business
model – long-term, inflation-proofed leasing of retail space – and the
associated risks. Long-term trends such as the growing impact of
e-commerce on stationary retail will affect our business in the
medium term, however. Past experience has demonstrated that by
locating our shopping centers in prime locations and by ensuring
broad sector diversification within the centers, we can achieve com-
mercial success even during periods of stagnation. Provided that sta-
tionary retailers review their networks in response to the rise of
online trading and focus on strong locations, our prime shopping
center locations could emerge even stronger from the structural
changes.
RISK OF RENT LOSS
It is possible that tenants may be unable to meet their obligations
under existing leases or that the previous rents may no longer be
obtained in the case of new and follow-on rentals. As a result, income
would turn out to be less than budgeted, and distributions to share-
holders might have to be reduced. If the rental income for a property
company is no longer sufficient to meet its interest and repayment
obligations, this could lead to the loss of the entire property. Tenants’
revenue trends and the accounts receivable trends are regularly ana-
lysed in this respect, and measures to find new tenants are initiated
at an early stage if there are signs of any negative developments.
The tenants provide corresponding security deposits against the risk
of default. In addition, write-downs are recognised in the accounts in
individual cases.
COST RISK
Expenditure on current maintenance or investment projects can turn
out higher than budgeted on the basis of experience. We minimise
risks from cost overruns in current investment projects by taking into
account cost models in the calculation for all identifiable risks in the
planning stage as a precautionary measure. In addition, construction
contracts are only awarded on a fixed-price basis to general contrac-
tors with strong credit ratings. During the building phase, professional
project management is assured by the companies we commission.
However, it is impossible to completely avoid cost overruns in ongoing
construction projects in individual cases.
VALUATION RISK
The value of a property is essentially determined by its capitalised
earnings value, which in turn depends on factors such as the level of
annual rental income, the underlying location risk, the evolution of
long-term capital market rates and the general condition of the prop-
erty. A reduction in rental income or a deterioration of the location risk
necessarily results in a lower capitalised earnings value. The appre-
ciation of the properties is therefore also significantly influenced by
a variety of macroeconomic or regional factors as well as develop-
ments specific to the property that can neither be foreseen nor influ-
enced by the Company. The factors described are taken into account
in the annual market valuations of our portfolio properties by inde-
pendent appraisers. Changes in value are recognised in the income
statement of the consolidated financial statements in accordance with
the requirements of IAS 40 and may thus increase the volatility of the
consolidated profit.
CURRENCY RISK
Deutsche EuroShop AG’s activities are limited exclusively to the Euro-
pean economic area. Manageable currency risks arise in the case of
the Eastern European investment companies. These risks are not
hedged because this is purely an issue of translation at the reporting
date and is therefore not associated with any cash flow risks. The
currency risk from operations is largely hedged by linking rents and
loan liabilities to the euro. A risk could arise if the Hungarian forint or
the Polish zloty were to plummet against the euro such that tenants
were no longer able to pay what would then be considerably higher
rents denominated in foreign currency.
FINANCING AND INTEREST RATE RISKS
We minimise the interest rate risk for new property financing as far
as possible by entering into long-term loans with fixed-interest peri-
ods of up to 20 years. There is a risk that refinancing may only be
available at higher interest rates than before. The interest rate level
is materially determined by the underlying macroeconomic conditions
and therefore cannot be predicted by us.
The possibility cannot be completely excluded that, due for example
to a deterioration in the Company’s results of operations, banks may
not be prepared to provide refinancing or to extend credit lines. We
monitor the interest rate environment closely so as to be able to react
appropriately to interest rate changes with alternative financing con-
cepts or hedging if necessary. With average interest rates at 3.88%
(2012: 4.25%), this does not currently present a significant risk within
the Group, particularly since the most recent refinancing was con-
cluded at lower interest rates than the original financing and the cur-
rent average interest rate.

133
Deutsche EuroShop AG uses derivatives that qualify for hedge
accounting to hedge interest rate risks. These interest rate swap
transactions transform variable interest rates into fixed interest
rates. An interest rate swap is an effective hedge if the principal
amounts, maturities, repricing or repayment dates, interest payment
and principal repayment dates, and the basis of calculation used to
determine the interest rates are identical for the hedge and the under-
lying transaction and the party to the contract fulfils the contract.
Interest swaps and the underlying transaction are reported as one
item. Financial instruments are not subject to liquidity or other risks.
The Company counters the risk of default by stringently examining its
contract partners. A test of effectiveness for the hedges described is
implemented regularly.
RISK OF DAMAGE
The property companies bear the risk of total or partial destruction of
the properties. The insurance payouts due in such a case might be
insufficient to compensate fully for the damage. It is conceivable that
insurance cover is not sufficient for all theoretically possible losses
or that the insurers may refuse to provide compensation.
IT RISK
Deutsche EuroShop’s information system is based on a centrally man-
aged network solution. Corrective and preventive maintenance of the
system is carried out by an external service provider. A virus protec-
tion concept and permanent monitoring of data traffic with respect to
hidden and dangerous content are designed to protect against exter-
nal attacks. All data relevant to operations is backed up on a daily
basis. In the event of a hardware or software failure in our system, all
data can be reproduced at short notice.
PERSONNEL RISK
Given the small number of employees of Deutsche EuroShop AG, the
Company is dependent on individual persons in key positions. The
departure of these key staff would lead to a loss of expertise, and the
recruitment and induction of new replacement personnel could tem-
porarily impair ongoing day-to-day business.
LEGAL RISK
The concept for our business model is based on the current legal
situation, administrative opinion and court decisions, all of which may
change at any time, however.
EVALUATION OF THE OVERALL RISK POSITION
On the basis of the monitoring system described, Deutsche EuroShop
has taken appropriate steps to identify developments that could jeop-
ardise its continued existence at an early stage and to counteract
them. The Executive Board is not aware of any risks that could jeop-
ardise the continued existence of the Company.

134
Remuneration report
The remuneration rules of Deutsche EuroShop AG were last reviewed
by the Supervisory Board in 2010 and amended to comply with the
Gesetz zur Angemessenheit der Vorstandsvergütung (VorstAG – Ger-
man Act on the Appropriateness of Executive Board Remuneration)
and the Corporate Governance Code.
REMUNERATION SYSTEM FOR THE EXECUTIVE BOARD
Remuneration for the Executive Board is set by the Supervisory Board.
The remuneration system provides for a non-performance-related
basic annual remuneration component based on the individual Exec-
utive Board member’s duties, a performance-related remuneration
component and non-cash benefits in the form of a company car and
contributions to a pension scheme.
As a performance-related remuneration component, the bonus is
dependent on the long-term performance of the company. It is based
on the weighted average over the financial year and the two previous
financial years. Group EBT (excluding valuation gains/losses) for the
financial year is taken into account at a weighting of 60% in the basis
of calculation, that of the previous financial year at 30% and that of
the financial year before that at 10%. Mr Böge receives 0.5% of the
calculation basis as a bonus and Mr Borkers receives 0.2%. with the
amount of the bonus limited to 150% of the basic annual remuneration.
The non-performance-related basic annual remuneration is €300,000
for Mr Böge and €168,000 for Mr Borkers. In addition, Mr Böge is
expected to receive a bonus of €450,000 and Mr Borkers €231,000 for
financial year 2013. The final amount of the bonus will only be avail-
able after approval of the consolidated financial statements by the
Supervisory Board; the bonus will be paid following approval.
Should the results of operations and net assets of the Company dete-
riorate during the term of the respective employment contracts to
such an extent that further payment of this remuneration becomes
unreasonable, the rules of section 87(2) of the AktG will apply. In such
a case, the Supervisory Board decides at its own discretion on the
extent to which remuneration will be reduced.
In the event that the employment contract is terminated prematurely
by the Company without any good cause, the members of the Execu-
tive Board shall be entitled to a settlement in the amount of the annual
remuneration outstanding up to the end of the agreed contractual
term, but limited to an amount equivalent to a maximum of two annual
remunerations (basic annual remuneration plus bonus). The annual
remuneration amount is determined on the basis of the average
annual remuneration for the previous financial year and the probable
annual remuneration for the current financial.
A long-term incentive (LTI) remuneration component was agreed for
the first time in 2010. The amount of the LTI is based on the changes
in the market capitalisation of Deutsche EuroShop AG between 1 July
2010 and 30 July 2015. Market capitalisation is calculated by multi-
plying the share price by the number of Company shares issued. On
1 July 2010, according to information provided by the German stock
exchange, market capitalisation stood at €983.5 million.
If, over the five-year period, there is a positive change in market cap-
italisation of up to €500 million, Mr Böge will receive 0.2% and Mr
Borkers 0.025% of the change. For any change over and above this
amount, Mr Böge will receive 0.1% and Mr Borkers 0.0125%. The LTI
will be paid out to Mr Borkers in December 2015, and to Mr Böge in
five equal annual instalments, the first being paid on 1 January 2016.
In the event that the employment contract is terminated prematurely
by the Company, any entitlements arising from the LTI until that date
will be paid out prematurely.
Between 1 July 2010 and 31 December 2013, the market capitalisa-
tion of the Company rose to €1,717.1 million (end-2012: €1,706.8 mil-
lion), an increase of €733.6 million against 1 July 2010 (end-2012:
€723.3 million) The present value of the potential entitlement to the
long-term incentive arising therefrom was €1.302 million at year-end
(31 December 2012: €1.272 million). An allocation to the provision of
€306,000 (2012: €305,000) was included for this purpose during the
financial year.
REMUNERATION OF THE EXECUTIVE BOARD 2013
The remuneration of the Executive Board totalled €1.237 million,
which can be broken down as follows:
Non-perfor-
mance-related
remuneration
Performance-
related
remuneration
Ancillary
benefits Total
Total
Previous year
Claus-Matthias Böge 300 447 80 827 829
Olaf Borkers 168 230 12 410 364
468 677 92 1,237 1,193
€ THOUSAND

135
In addition to the prospective bonuses for the financial year, the per-
formance-related remuneration also includes the difference between
the prospective and final bonuses for the previous year (€–4,000).
The ancillary benefits for each Executive Board member include the
provision of a car for business and private use as well as contribu-
tions to a pension scheme.
No advances or loans were granted to members of the Executive
Board. The Company has not entered into any commitments or con-
tingent liabilities in favour of these persons.
REMUNERATION SYSTEM FOR THE
SUPERVISORY BOARD
The remuneration of the Supervisory Board is based on section 8(4)
of the Articles of Association of Deutsche EuroShop AG. In accordance
with the Articles of Association, the remuneration amounts to €50,000
for the chairman, €37,500 for the deputy chairman and €25,000 for
each of the other members of the Supervisory Board. Committee
membership is not taken into account when determining the remu-
neration of the Supervisory Board. Moreover, the remuneration does
not contain any performance-related elements. The remuneration is
determined on the basis of the business model and size of the Com-
pany as well as the responsibility associated with the role. The Com-
pany’s business and financial position is also taken into consideration.
If any member of the Supervisory Board should leave the Supervisory
Board during the financial year, they shall receive their remuneration
pro rata. In accordance with section 8(5) of the Articles of Association,
expenses are also reimbursed.
REMUNERATION OF THE SUPERVISORY BOARD 2013
The remuneration of the members of the Supervisory Board came to
€312,000 in the period under review, which can be broken down as
follows:
2013 2012
Manfred Zaß 59.50 59.50
Dr. Michael Gellen 44.62 44.62
Thomas Armbrust 29.75 29.75
Karin Dohm 29.75 13.98
Dr. Jörn Kreke 13.94 29.75
Dr. Henning Kreke 15.81 0
Alexander Otto 29.75 29.75
Reiner Strecker 29.75 13.98
Klaus Striebich 29.75 13.98
Dr. Bernd Thiemann 29.75 29.75
Including 19% value added tax 312.37 265.06
No advances or loans were granted to the members of the Super-
visory Board.
MISCELLANEOUS
No agreements have been concluded with members of the Executive
Board that provide for a severance payment on expiry of their current
employment contract.
No pensions are paid to former members of the Executive or Super-
visory Boards or to their dependents.
€ THOUSAND

136
Acquisition reporting
Deutsche EuroShop shares are traded on the Frankfurt Stock
Exchange and other exchanges. As at 31 December 2013, 9.73% of
shares were owned by Alexander Otto (2012: 9.57%).
The share capital amounts to €53,945,536 and comprises 53,945,536
no-par value registered shares. The notional value of each share is
€1.00.
According to Article 5 of the Articles of Association, the Executive
Board is authorised, with the Supervisory Board’s approval, to increase
the share capital by up to a total of €26,972,768 through one or several
issues of new no-par value registered shares against cash or non-
cash contributions before 19 June 2018 (“Authorised capital 2013”).
The Executive Board is authorised, with the Supervisory Board’s
approval, to issue, until 15 June 2016, convertible bonds with a total
nominal value of up to €200,000,000 and a maximum term of 10 years
and to grant the holders of the respective, equally privileged, bonds
conversion rights to new no-par value shares in the Company up to a
total of 10,000,000 shares (€10.0 million), as detailed in the terms and
conditions for convertible bonds (“Bond conditions”; “Conditional
capital 2011”). The convertible bonds may also pay a variable rate of
interest, in which case, as with a participating bond, the interest may
be dependent in full or in part on the level of the Company’s dividend.
In November 2012, Deutsche EuroShop issued a convertible bond with
a five-year term and a nominal value of €100,000,000, for which some
2.9 million no-par shares are currently reserved in conditional capital.
A change-of-control arrangement has been agreed with two employ-
ees. Under this arrangement, if and insofar as the Company informs
them that they will no longer be employed in their current positions,
these employees will have a special right of termination with a notice
period of one month up to the end of the quarter, which will be valid
for 12 months from the date the change of control takes effect.
A change of control arises if Deutsche EuroShop AG merges with
another company, if a public takeover bid has been made under the
Deutsches Wertpapiererwerbs- und Übernahmegesetz (WpÜG – Ger-
man Securities Acquisition and Takeover Act) and accepted by a
majority of shareholders, if the Company is integrated into a new
group of companies or if the Company goes private and is delisted.
In the event of such termination of the employment relationship, these
employees will receive a one-time payment amounting to three
months’ gross salary multiplied by the number of years that they have
worked for the Company, but limited to a maximum of 24 months’
gross salary.
Deutsche EuroShop Group does not currently have any other compen-
sation agreements with members of the Executive Board or other
employees for the event of a change of control.
The material provisions governing Deutsche EuroShop AG, which
include a change of control clause, primarily relate to bilateral credit
facilities and various loan agreements. In the event of a takeover, the
relevant lenders are entitled to terminate the facility and where appli-
cable demand immediate repayment. A takeover is defined as a third
party taking control of Deutsche EuroShop AG; the takeover may also
be made by a group acting jointly.
Declaration on
corporate governance
(section 289a HGB)
The declaration on corporate governance, in conformity with section
3.10 of the Deutscher Corporate Governance Kodex (German Corpo-
rate Governance Code) and section 315a of the Handelsgesetzbuch
(German Commercial Code – HGB) has been published on the
Deutsche EuroShop website: www.deutsche-euroshop.de/ezu.
Hamburg, 15. April 2014
FORWARD-LOOKING STATEMENTS
This Management Report contains forward-looking statements based on
estimates of future developments by the Executive Board. The statements
and forecasts represent estimates based on all of the information avail-
able at the current time. If the assumptions on which these statements
and forecasts are based do not materialise, the actual results may differ
from those currently being forecast.
ROUNDING AND RATES OF CHANGE
Percentages and figures stated in this report may be subject to rounding
differences. The rates of change are based on economic considerations:
improvements are indicated by a plus (+), deterioration by a minus (-).

137137
DEUTSCHEEUROSHOPANNUALREPORT2013/CONSOLIDATEDFINANCIALSTATEMENTS
Consolidated
Financial
Statements
138 Consolidated balance sheet
140 Consolidated income statement
141 Consolidated statement of comprehensive income
141 Consolidated cash flow statement
143 Statement of changes in equity
144 Notes to the Consolidated financial statements
190 Auditor’s report

138
Note 31.12.2013
31.12.2012
after adjustment
01.01.2012
after adjustment
ASSETS
Non-current assets
Intangible assets 1. 8 16 20
Property, plant and equipment 2. 413 112 137
Investment properties 3. 2,962,163 2,824,133 2,596,131
Investments accounted for using the equity method 4. 341,907 321,534 326,699
Other financial assets 5. 34,519 30,293 27,815
Other non-current assets 6. 155 312 459
Non-current assets 3,339,165 3,176,400 2,951,261
Current assets
Trade receivables 7. 5,595 3,772 4,912
Other current assets 8. 6,293 6,382 14,207
Other financial investments 9. 3,000 0 0
Cash and cash equivalents 10. 40,810 161,006 57,613
Current assets 55,698 171,160 76,732
Total assets 3,394,863 3,347,560 3,027,993
ASSETS IN € THOUSAND
Consolidated balance sheet

139
Note 31.12.2013
31.12.2012
after adjustment
01.01.2012
after adjustment
EQUITY AND LIABILITIES
Equity and reserves
Issued capital 53,945 53,945 51,631
Capital reserves 961,970 961,987 890,482
Retained earnings 413,034 305,982 250,928
Total equity 11. 1,428,949 1,321,914 1,193,041
Non-current liabilities
Financial liabilities 12. 1,389,552 1,276,303 1,185,613
Deferred tax liabilities 13. 198,491 180,525 210,587
Right to redeem of limited partners 213,422 284,176 280,078
Other liabilities 18. 41,096 42,684 32,288
Non-current liabilities 1,842,561 1,783,688 1,708,566
Current liabilities
Financial liabilities 12. 97,207 191,298 97,962
Trade payables 14. 3,351 2,135 2,389
Tax liabilities 15. 1,357 24,569 5,913
Other provisions 16. 6,804 12,495 8,281
Other liabilities 17. 14,634 11,461 11,841
Current liabilities 123,353 241,958 126,386
Total equity and liabilities 3,394,863 3,347,560 3,027,993
EQUITY AND LIABILITIES IN € THOUSAND

140
Note 01.01. – 31.12.2013
01.01.–31.12.2012
after adjustment
Revenue 19. 187,987 178,161
Property operating costs 20. -8,452 -9,983
Property management costs 21. -9,323 -8,502
Net operating income (NOI) 170,212 159,676
Other operating income 22. 2,837 2,733
Other operating expenses 23. -7,285 -10,830
Earnings before interest and taxes (EBIT) 165,764 151,579
Income from investments 24. 16,688 1,400
Interest income 448 500
Interest expense -57,827 -63,066
Other financial expenses -4,550 0
Income from the disposal of financial assets 23 0
Share of the profit or loss of associates and joint ventures accounted for using the equity method 25. 27,024 14,346
Profit/loss attributable to limited partners 26. -15,939 -15,271
Net finance costs -34,133 -62,091
Measurement gains/losses 27. 55,982 13,934
of which excess of identified net assets acquired over cost of acquisition in accordance
with IFRS 3 €0 thousand (previous year: €4,410 thousand)
Earnings before taxes (EBT) 187,613 103,422
Income tax expense 28. -16,570 19,062
Earnings per share (€), basic 32. 3.17 2.36
Earnings per share (€), diluted 32. 3.05 2.35
€ THOUSAND
Consolidated income statement

141
Note 2013 2012
Items which under certain conditions will be reclassified to the income statement
in future periods:
Changes in cash flow hedge 11., 30. 11,217 -12,073
Change in investments accounted for using the equity method 11. 7,519 -2,395
Change due to IAS 39 measurement of investments 4., 11., 30. 3,606 2,478
Disposal due to IAS 39 measurement of investments 11., 30. -15,799 0
Deferred taxes on changes in value offset directly against equity 11., 13. -5,354 1,344
Total earnings recognised directly in equity 1,189 -10,646
Total profit 172,232 111,838
Share of Group shareholders 172,232 111,838
€ THOUSAND
Consolidated statement of comprehensive income

142
Consolidated cash flow statement
Note 01.01. – 31.12.2013 01.01.–31.12.2012
Profit after tax 171,043 122,484
Expenses/income from the application of IFRS 3 27. 0 -5,289
Income from the disposal of shareholdings 24. -15,822 0
Profit/loss attributable to limited partners 26., 27. 20,431 33,946
Depreciation of intangible assets and property, plant and equipment 1., 2. 65 40
Unrealised changes in fair value of investment property 26. -60,539 -36,518
Net loss from derivatives 4,550 0
Other non-cash income and expenses 1,662 484
Profit/losses of joint ventures and associates 25., 31. -5,849 2,984
Expenses from investment activities to be allocated to the cash flow 27. 64 9,198
Deferred taxes 28. 14,208 -27,545
Operating cash flow 129,813 99,784
Changes in receivables 6., 7., 8., 30. -1,402 -128
Change in other financial investments 16. -3,000 0
Changes in current provisions 14., 15., 17. -29,657 22,871
Changes in liabilities 18., 30. 3,642 -667
Cash flow from operating activities 99,396 121,860
Payments to acquire property, plant and equipment/investment properties 2., 3. -18,491 -11,735
Expenses from investment activities to be allocated to the cash flow -64 -9,198
Payments to acquire shareholdings in consolidated companies and business units -59,438 -176,250
Inflows/outflows to/from the financial assets -600 -210
Cash flow from investing activities -78,593 -197,393
Outflow from the repayment of financial liabilities 12. -59,739 190,684
Contributions of Group shareholders 11., 29. 0 66,198
Payments to limited partners 29. -12,285 -21,161
Payments to Group shareholders 11., 29. -64,735 -56,795
Cash flow from financing activities -136,759 178,926
Net change in cash and cash equivalents -115,956 103,393
Cash and cash equivalents at beginning of period 161,006 57,613
Changes in the financial resources fund due to consolidation changes -4,240 0
Cash and cash equivalents at end of period 40,810 161,006
€ THOUSAND

143
Statement of changes in equity
Note
Number of
shares out-
standing
Share
capital
Capital
reserves
Other
retained
earnings
Statutory
reserve
Available-
for-sale
reserve
Cash flow
hedge
reserve Total
01.01.2012 51,631,400 51,631 890,482 262,538 2,000 9,715 -23,325 1,193,041
IAS 8 Amendment -3,136 3,136
01.01.2012 after amendment 51,631,400 51,631 890,482 259,402 2,000 9,715 -20,189 1,193,041
01.01.2012 after adjustment 51,631,400 51,631 890,482 259,402 2,000 9,715 -20,189 1,193,041
Total earnings recognised
directly in equity -1,968 2,478 -11,156 -10,646
Total profit 120,516 0 2,478 -11,156 111,838
Dividend payments 11. -56,795 -56,795
Bond conversion right 12. 7,140 7,140
Capital increase 2,314,136 2,314 64,365 66,679
Other changes 11 11
31.12.2012 53,945,536 53,945 961,987 323,134 2,000 12,193 -31,345 1,321,914
01.01.2013 53,945,536 53,945 961,987 323,134 2,000 12,193 -31,345 1,321,914
Total earnings recognised
directly in equity 0 5,034 -12,193 8,348 1,189
Total profit 0 0 176,077 0 -12,193 8,348 172,232
Dividend payments 11. -64,735 -64,735
Other changes -17 -445 -462
31.12.2013 53,945,536 53,945 961,970 434,031 2,000 0 -22,997 1,428,949
€ THOUSAND

144
NOTES TO THE CON-
SOLIDATED FINANCIAL
STATEMENTS
FINANCIAL YEAR 2013
GENERAL DISCLOSURES
The Group parent company is Deutsche EuroShop AG, Hamburg, Germany. The Company’s registered office is Heegbarg 36,
22391 Hamburg, and it is entered in the Hamburg commercial register under HRB 91799.
Deutsche EuroShop AG focuses on acquiring, managing, using and selling investments of all kinds, and in particular
investments in retail properties.
The consolidated financial statements of Deutsche EuroShop AG have been prepared in accordance with the Inter-
national Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB), including
the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) and the supplementary
provisions of German commercial law required to be applied under section 315a (1) of the Handelsgesetzbuch (HGB –
German Commercial Code). They are based on the premise of a going concern. All IFRSs and IFRIC interpretations
endorsed by the European Commission and required to be applied as of 31 December 2013 have been applied.
In addition to the consolidated balance sheet, consolidated income statement and the consolidated statement of com-
prehensive income, the consolidated financial statements comprise the consolidated statement of changes in equity,
the cash flow statement and the notes to the consolidated financial statements.
Amounts are mainly presented in thousands of €.
The preparation of the consolidated financial statements necessitates the use of estimates and assumptions. These affect
the reported amounts of assets, liabilities and contingent liabilities at the balance sheet date, as well as the recognition
of income and expenses during the reporting period. The actual amounts can differ from these estimates. Expected cash
flows and the discount factor in particular are critical parameters for the measurement of investment properties.
The consolidated financial statements as at 31 December 2013 were approved by the Audit Committee of the Super-
visory Board on 15 April 2014 and are expected to be approved at the Supervisory Board’s financial statements review
meeting on 23 April 2014. Until the consolidated financial statements are adopted there is still a possibility that they
may be amended.
A detailed list of the companies included in the consolidated financial statements forms part of the notes.
The annual financial statements of the consolidated companies were prepared as at 31 December 2013, the reporting
date of the consolidated financial statements.

145
BASIS OF CONSOLIDATION AND
CONSOLIDATION METHODS
BASIS OF CONSOLIDATION
SUBSIDIARIES
The consolidated financial statements include all subsidiaries in which Deutsche EuroShop AG directly or indirectly
holds a majority of voting rights.
As at 31 December 2013, the basis of consolidation comprised, in addition to the parent company, twelve (previous
year: 12) fully consolidated domestic and foreign subsidiaries.
Suspension of the voting trust agreement with two property companies
A voting trust agreement was in place with a co-shareholder of Immobilien Kommanditgesellschaft FEZ Harburg and
Stadt-Galerie Passau KG until 31 December 2012 which granted Deutsche EuroShop controlling interest of these com-
panies. These voting trust agreements were terminated by mutual agreement at midnight on 31 December 2012. As
a result, Deutsche EuroShop no longer has the necessary majority voting interest. The two companies in which
Deutsche EuroShop AG holds a 50% and 75% stake respectively, were previously fully consolidated. After their decon-
solidation they were also switched to the equity-accounted method as of 1 January 2013, with the result that the fol-
lowing asset and liability items from the consolidated balance sheet are no longer shown:
Investment properties 333,370
Receivables and other assets 1,114
Cash and cash equivalents 2,812
Provisions 124
Financial liabilities 109,872
Other liabilities 581
Minority interests 77,666
The fair value of disposed net assets was accounted for as “investments accounted for using the equity method”.
Withdrawal of Deutsche EuroShop AG from DB 12 Immobilienfonds 12 Main-Taunus-Zentrum KG,
Hamburg
As of 31 December 2012, Deutsche EuroShop withdrew as a limited partner from DB Immobilienfonds 12 Main-Taunus-
Zentrum KG (DB 12 KG). As compensation, Deutsche EuroShop received its limited partnership interest in the Main-
Taunus-Zentrum KG, which had previously been held directly via DB 12 KG, plus a proportionate share of cash and
cash equivalents in the amount of €1.5 million. DB 12 KG had previously been fully consolidated. The company was
deconsolidated on 1 January 2013, with the result that the following asset and liability items from the consolidated
balance sheet as of 31 December 2012 are no longer shown:
€ THOUSAND

146
Cash and cash equivalents -2,973
Provisions and liabilities 155
Deconsolidation amount -2,818
This event did not have an impact on earnings. It increases the Company’s direct shareholding in Main-Taunus-Zentrum
KG from 5.74% to 52.01%.
Shareholding in Altmarkt-Galerie Dresden KG increased to 100%
With effect from 1 May 2013, Deutsche EuroShop AG acquired 33% of the Altmarkt-Galerie Dresden KG, thus taking
its shareholding to 100%. The purchase price was €70.2 million. The property company was fully consolidated as of
1 May 2013. No excess of identified net assets acquired over cost of acquisition resulted from the first-time consoli-
dation. In the whole of 2013 the company posted revenue of €24,540 thousand and a loss of €31,639 thousand. In the
period from 1 May to 31 December 2013, turnover amounted to €16,129 thousand and the profit for the year to
€28,592 thousand.
Carrying amounts Fair value
Purchase price 70,216 70,216
Fair value net assets prior to effective control 111,637 111,637
Full amount of consideration 181,853 181,853
Net assets acquired:
Property assets 392,735 392,735
Cash and cash equivalents 10,778 10,778
Receivables and other assets 1,342 1,342
Loan liabilities 187,107 187,107
Deferred taxes 21,743 21,743
Provisions 885 885
Other liabilities 13,267 181,853 13,267
Excess of identified net assets acquired over
cost of acquisition 0 0
Sale of Kommanditgesellschaft PANTA Achtundvierzigste Grundstücksgesellschaft GmbH&Co.,
Hamburg
With effect from 30 September 2013 the shares in Kommanditgesellschaft PANTA Achtundvierzigste Grundstücks-
gesellschaft m.b.H.&Co., Hamburg were sold for a purchase price of €25 thousand. The previously equity-accounted
net asset value of €437 thousand was offset against outstanding obligations to make capital contributions of €435 thou-
sand, resulting in sales proceeds in the amount of €23 thousand. By 30 September 2014 the company generated a net
loss amounting to €6 thousand, which is included in the net finance costs.
JOINT VENTURES
Joint ventures in which Deutsche EuroShop AG has a majority of the voting rights together with third parties are
accounted for using the equity method. Six companies fall into this category as at the balance sheet date. Please also
note the explanations of the “Changes in accounting and valuation methods”.
ASSOCIATES
In accordance with IAS 28, where Deutsche EuroShop AG can exercise a significant influence but not control over compa-
nies, these are accounted for using the equity method. Five companies fall into this category as at the balance sheet date.
€ THOUSAND
€ THOUSAND

147
INVESTEES
Investments over which Deutsche EuroShop AG has neither significant influence nor control are measured at fair value,
in line with the provisions of IAS 39. These include the investment in Ilwro Holding B.V. Amsterdam, into which the
investment in Ilwro Joint Venture Sp zo.o. was incorporated in the year under review.
CONSOLIDATION METHODS
For purchase accounting, the cost is eliminated against the parent company’s interest in the re-valued equity of the
subsidiaries at the date of acquisition or initial consolidation. Any remaining excess of identified net assets acquired
over cost of acquisition is recognised as goodwill in intangible assets. Any excess of identified net assets acquired
over cost of acquisition is recognised in income following a further reassessment.
Joint ventures and associates are accounted for using the equity method. The cost of the investment is recognised in
income at an amount increased or reduced by the changes in equity corresponding to the equity interest of Deutsche
EuroShop AG.
Intragroup transactions are eliminated as part of the consolidation of intercompany balances and of income and
expenses.
CURRENCY TRANSLATION
The Group currency is the Euro (€).
The companies located outside the eurozone that are included in the consolidated financial statements are treated as
legally independent, but economically dependent, integrated companies. The reporting currency of this company (Polish
zloty) therefore deviates from the functional currency (euro). Under IAS 21, annual financial statements prepared in
foreign currencies are translated using the functional currency method, with the result that the balance sheet is to be
translated as if the transactions had arisen for the Group itself, as the local currency of the integrated companies is
deemed to be a foreign currency for these companies.
Monetary values are therefore translated at the closing rate and non-monetary items at the rate that applied at the
time of initial recognition. Non-monetary items to be reported at fair value are translated at the closing rate. Items in
the consolidated income statement that are recognised in income are translated at average rates for the year or, in
the event of strong fluctuations, using the rate that applied on the date of the transaction. Any translation differences
that may arise if the translation rates of the balance sheet and consolidated income statement differ are recognised
in profit or loss.
A closing rate of HUF 296.91 (previous year: HUF 291.29) and an average rate of HUF 296.92 (previous year: HUF 289.42)
were used in the translation of the separate Hungarian financial statements for Einkaufs-Center Arkaden Pécs KG,
Hamburg, from forint to euros. A closing rate of PLN 4.1472 (previous year: PLN 4.0822) and an average rate of
PLN 4.1975 (previous year: PLN 4.185) were taken as a basis for translating the separate financial statements of the
Polish property company.

148
CHANGES IN ACCOUNTING POLICIES
Switch from the proportionate consolidation method to equity method accounting from 1 January 2013
Joint ventures in which Deutsche EuroShop AG has a majority of the voting rights together with third parties have up
until now been proportionately included as joint ventures in the consolidated financial statements. Proportional con-
solidation is no longer allowed given the adoption of the new IFRS 11. In future, joint ventures will be accounted for
using the equity method. Adoption of this standard is compulsory as of 1 January 2014. Regardless of this, we exer-
cised our right as set forth in IAS 31 and switched to equity accounting as of 1 January 2013.
The comparative amounts of fiscal year 2012 have been altered as though in 2012 and in previous periods equity
accounting had been applied. This means that the capital market now has a clearer picture of the asset, financial and
earnings position of the Group with a view to the upcoming changes induced by IFRS 11.
The transition from proportional to equity accounting has an impact on the structure of our consolidated financial
statements. Assets, liabilities, expenses and income are no longer recognised proportionally in the corresponding
balance sheet or income statement items.
The following companies are affected by the switch:
• Altmarkt-Galerie Dresden KG, Hamburg (until 30 April 2013)
• Allee-Center Magdeburg KG, Hamburg
• CAK City Arkaden Klagenfurt KG, Hamburg
• EKZ Eins Errichtungs- und Betriebs Ges.m.b.H.&Co OG, Vienna
• Einkaufs-Center Arkaden Pécs KG, Hamburg

149
RECONCILIATION OF THE CONSOLIDATED BALANCE SHEET USING THE EQUITY METHOD
AS AT 1 JANUARY 2012
01.01.2012
before adjustment
01.01.2012
adjustment
01.01.2012
after adjustment
ASSETS
Non-current assets
Intangible assets 20 0 20
Property, plant and equipment 137 0 137
Investment properties 3,106,832 -510,701 2,596,131
Investments accounted for using the equity method 4,514 322,185 326,699
Other financial assets 27,815 0 27,815
Other non-current assets 459 0 459
Non-current assets 3,139,777 -188,516 2,951,261
Current assets
Trade receivables 5,606 -694 4,912
Other current assets 15,334 -1,127 14,207
Cash and cash equivalents 64,408 -6,795 57,613
Current assets 85,348 -8,616 76,732
Total assets 3,225,125 -197,132 3,027,993
01.01.2012
before adjustment
01.01.2012
adjustment
01.01.2012
after adjustment
Equity and reserves
Issued capital 51,631 0 51,631
Capital reserves 890,482 0 890,482
Retained earnings 250,928 0 250,928
Total equity 1,193,041 0 1,193,041
Financial liabilities 1,335,986 -150,373 1,185,613
Deferred tax liabilities 210,587 0 210,587
Right to redeem of limited partners 280,078 0 280,078
Other liabilities 38,451 -6,163 32,288
Non-current liabilities 1,865,102 -156,536 1,708,566
Current liabilities
Bank loans and overdrafts 136,163 -38,201 97,962
Trade payables 2,835 -446 2,389
Tax liabilities 5,935 -22 5,913
Other provisions 8,859 -578 8,281
Current liabilities 166,982 -40,596 126,386
Total equity and liabilities 3,225,125 -197,132 3,027,993

150
RECONCILIATION OF THE CONSOLIDATED BALANCE SHEET USING THE EQUITY METHOD
AS AT 31. DECEMBER 2012
31.12.2012
before adjustment
31.12.2012
adjustment
31.12.2012
after adjustment
ASSETS
Non-current assets
Intangible assets 16 0 16
Property, plant and equipment 112 0 112
Other financial assets 30,293 0 30,293
Other non-current assets 316 -4 312
Current assets
Other current assets 7,115 -733 6,382
Other financial investments 4,355 -4,355 0
Current assets 183,719 -12,559 171,160
Total assets 3,548,854 -201,294 3,347,560
31.12.2012
before adjustment
31.12.2012
adjustment
31.12.2012
after adjustment
Equity and reserves
Issued capital 53,945 0 53,945
Capital reserves 961,987 0 961,987
Retained earnings 305,982 0 305,982
Total equity 1,321,914 0 1,321,914
Deferred tax liabilities 180,525 0 180,525
Right to redeem of limited partners 284,176 0 284,176
Current liabilities
Bank loans and overdrafts 194,137 -2,839 191,298
Tax liabilities 24,572 -3 24,569

151
RECONCILIATION OF THE CONSOLIDATED INCOME STATEMENT USING THE EQUITY METHOD
AS AT 31 DECEMBER 2012
01.01.–31.12.2012
before adjustment
01.01.–31.12.2012
adjustment
01.01.–31.12.2012
after adjustment
Revenue 211,231 -33,070 178,161
Property operating costs -11,256 1,273 -9,983
Property management costs -10,547 2,045 -8,502
Net operating income (NOI) 189,428 -29,752 159,676
Other operating income 2,905 -172 2,733
Other operating expenses -11,316 486 -10,830
Earnings before interest and taxes (EBIT) 181,017 -29,438 151,579
Income from investments 1,400 0 1,400
Interest income 540 -40 500
Interest expense -72,064 8,998 -63,066
Profit/loss attributable to limited partners -15,271 0 -15,271
Share of the profit or loss of associates and joint
ventures accounted for using the equity method -589 14,935 14,346
Net finance costs -85,984 23,893 -62,091
Measurement gains/losses 8,495 5,439 13,934
of which excess of identified net assets acquired over
cost of acquisition in accordance with IFRS 3
€4,410 thousand
Earnings before taxes (EBT) 103,528 -106 103,422
Income tax expense 18,956 106 19,062
Consolidated profit 122,484 0 122,484
Earnings per share (€), basic 2.36 0 2.36
Earnings per share (€), diluted 2.35 0 2.35
RECONCILIATION OF THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME USING THE
EQUITY METHOD AS AT 31 DECEMBER 2012
01.01.–31.12.2012
before adjustment
01.01.–31.12.2012
adjustment
01.01.–31.12.2012
after adjustment
Changes in cash flow hedge -14,468 2,395 -12,073
Change in investments accounted for using
the equity method 0 -2,395 -2,395
APPLICATION OF THE PREVIOUS ACCOUNTING METHOD
The consolidated financial statements were switched to equity accounting from 2012 as permitted by IAS 31. Using
the previous accounting method, the companies switched to equity accounting would have been incorporated propor-
tionately in the consolidated financial statements. The balance sheet and income statement for 2013 would then have
appeared as follows:
€ THOUSAND
€ THOUSAND

152
CONSOLIDATED BALANCE SHEET
31.12.2013
before adjustment
31.12.2013
adjustment
31.12.2013
after adjustment
ASSETS
Non-current assets
Intangible assets 8 8
Property, plant and equipment 413 413
Other financial assets 34,519 34,519
Other non-current assets 155 155
Current assets
Other current assets 7,006 -713 6,293
Other financial investments 3,000 3,000
Current assets 60,957 -5,259 55,698
Total assets 3,513,335 -118,472 3,394,863
31.12.2013
before adjustment
31.12.2013
adjustment
31.12.2013
after adjustment
Equity and reserves
Issued capital 53,945 53,945
Capital reserves 961,970 961,970
Retained earnings 413,034 413,034
Total equity 1,428,949 0 1,428,949
Deferred tax liabilities 198,491 198,491
Right to redeem of limited partners 213,422 213,422
Other liabilities 41,096 41,096
Current liabilities
Financial liabilities 98,657 -1,450 97,207
Tax liabilities 1,357 1,357

153
CONSOLIDATED INCOME STATEMENT
01.01.–31.12.2013
before adjustment
01.01.–31.12.2013
adjustment
01.01.–31.12.2013
after adjustment
Revenue 224,027 -36,040 187,987
Property operating costs -10,081 1,629 -8,452
Property management costs -11,191 1,868 -9,323
Net operating income (NOI) 202,755 -32,543 170,212
Other operating income 2,899 -62 2,837
Other operating expenses -7,572 287 -7,285
Earnings before interest and taxes (EBIT) 198,082 -32,318 165,764
Income from investments 16,688 0 16,688
Interest income 467 -19 448
Interest expense -65,866 8,039 -57,827
Derivative expense -4,550 0 -4,550
Income from the disposal of financial assets 23 0 23
Share of the profit or loss of associates and joint
ventures accounted for using the equity method 428 26,596 27,024
Profit/loss attributable to limited partners -15,939 -15,939
Net finance costs -68,749 34,616 -34,133
Measurement gains/losses
of which excess of identified net assets acquired over
cost of acquisition in accordance with IFRS 3
€0 thousand (previous year: €4,410 thousand) 58,355 -2,373 55,982
Earnings before tax (EBT) 187,688 -75 187,613
Income tax expense -16,645 75 -16,570
Consolidated profit 171,043 0 171,043
01.01.–31.12.2013
before adjustment
01.01.–31.12.2013
adjustment
01.01.–31.12.2013
after adjustment
Changes in cash flow hedge 18,736 -7,519 11,217
Changes in investments accounted for using
the equity mehtod 0 7,519 7,519
REPORTING PRINCIPLES
The following standards and interpretations or amendments to these were applicable for the first time in financial
year 2013:
1. Presentation of items of Other comprehensive income (amendment to IAS 1)
2. Employee Benefits (amendments to IAS 19)
3. IFRS 13 Fair Value Measurement
4. Deferred Tax: Realisation of underlying assets (amendment to IAS 12)
5. Hyperinflation and removal of fixed dates of application for first-time adopters (amendment to IFRS 1)
6. Explanatory notes – Offsetting financial assets and financial liabilities (amendment to IFRS 7)
7. Public-sector loans (amendment to IFRS 1)
8. Annual improvements to IFRS 2009-2011
9. IFRIC 20 Accounting for stripping costs in mining
€ THOUSAND
€ THOUSAND

154
REVISION OF IAS 1: PRESENTATION OF ITEMS OF OTHER COMPREHENSIVE INCOME (SINCE 1 JULY 2012)
The amendments to IAS 1 mean that new terminology is now used for the profit and loss account previously called the
statement of comprehensive income. The statement of comprehensive income is now called the “income statement
and other results”. This however is not compulsory. The company has not adopted this new terminology.
The amended IAS 1 continues to allow the income statement and other results to be disclosed in one profit and loss
account or in two directly consecutive profit and loss accounts. However, changes to IAS 1 require the grouping of
items of Other comprehensive income into two categories:
a) Items which are not subsequently reclassified into the income statement and
b) Items which under certain conditions in the future will be reclassified into the income statement.
Applicable income taxes are to be allocated to Other results items. This does not preclude the possibility of presenting
Other results items before tax, however. The changes have been applied retroactively by the Group and the Other
results items altered accordingly. Apart from the above-mentioned presentational changes, no consequences for the
presentation of the income statement and other earnings arise from the application of the amended IAS 1.
EMPLOYEE BENEFITS, AMENDMENTS TO IAS 19 (SINCE 1 JULY 2012)
The revised version of IAS 19 requires the immediate equity recognition of actuarial gains/losses on pension obliga-
tions under Other comprehensive income. The management too may in future no longer apply the expected long-term
return on plan assets to the plan assets portfolio. Instead it must apply the discount rate used for the liability. Also,
companies must in the future provide more explanatory notes. Among other things, the financing strategy should be
described and quantified. Also, a sensitivity analysis is required to clarify the influence of significant parameter
changes on the pension liability.
IFRS 13 FAIR VALUE MEASUREMENT (SINCE 1 JANUARY 2013)
IFRS 13 lays down uniform guidelines regarding evaluation at fair value and associated information. The scope of
application of IFRS 13 is wide-ranging and covers both financial and non-financial items. IFRS 13 is always used when
another IFRS requires or permits valuation at fair value or information on the calculation of fair value is required. This
does not apply to share-based remuneration that falls within the scope of IFRS 2 Share-based remuneration, leases
that fall within the scope of IAS 17 Leases and evaluations similar to fair value but not fair value (such as net realis-
able value under IAS 2 Inventories or use value under IAS 36 Impairment of assets).
IFRS 13 defines fair value as the price the reporting entity would receive in a normal transaction between market par-
ticipants on the capital market (or the most advantageous market) on the measurement date under current market
conditions when selling an asset, or would have to pay when transferring a debt. The fair value as per IFRS 13 is the
price on the market, regardless of whether this price is directly observable or estimable using another evaluation
method. In addition, IFRS 13 contains far-reaching disclosure requirements. IFRS 13 is to be applied prospectively
from 1 January 2013.

155
DEFERRED TAXES: REALISATION OF UNDERLYING ASSETS, AMENDMENTS TO IAS 12
(Date of application: Start of the first financial year on or following the ordinance’s entry into effect)
The valuation of deferred tax liabilities and entitlements depends on whether the carrying amount of the asset is real-
ised through use or sale. Real estate that is held as a financial investment at fair value is particularly subject to eval-
uation issues and especially high discretion. The amendment introduces the rebuttable presumption that such real
estate can also be realised by sale. However, this does not apply to assets newly evaluated under IAS 16 or 38.
SEVERE HYPERINFLATION AND REMOVAL OF FIXED DATES OF APPLICATION FOR FIRST-TIME
ADOPTERS, AMENDMENTS TO IFRS 1
(DATE OF APPLICATION: START OF THE FIRST FINANCIAL YEAR ON OR FOLLOWING THE
ORDINANCE’S ENTRY INTO EFFECT)
Following the amendment, the previously used reference to the date 1. January 2004 as the fixed conversion date has
been replaced by the general wording “Date of transition to IFRS”. Also, for the first time regulations have been cre-
ated for cases where companies for some time prior to the changeover were unable to comply with IFRS regulations
because the functional currency was highly inflationary (high inflation).
OFFSETTING FINANCIAL ASSETS AND FINANCIAL LIABILITIES, AMENDMENT TO IFRS 7
(SINCE 1 JANUARY 2013)
The amendment introduces comprehensive explanatory notes requirements with the aim of clarifying the way in which
netting agreements work.
PUBLIC-SECTOR LOANS, AMENDMENT TO IFRS 1 (SINCE 1 JANUARY 2013)
The amendments relate to public-sector loans at interest rates which are not market interest rates. The amendment
means that IFRS first-time adopters are offered a derogation to the full retrospective application of IFRS when accounting
for such loans during the transition to IFRS.
ANNUAL IMPROVEMENTS TO IFRS 2009–2011 (SINCE 1 JANUARY 2013)
IFRS 1 FIRST-TIME ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS:
REPEATED APPLICATION OF IFRS 1 AND INTEREST ON BORROWED CAPITAL
Repeated application of IFRS 1: Clarification of the scope of application. IFRS is also to be applied by companies whose
last financial statements did not comply with the IFRS. Interest on borrowed capital: Capitalisation of borrowing costs
relating to qualified assets whose activation date was before the transition to IFRS may be continued. After the tran-
sition date, only borrowing costs that comply with IAS 23 may be capitalised.
IAS 1 PRESENTATION OF FINANCIAL STATEMENTS: PRIOR-PERIOD AMOUNTS
Clarification of when preparation of a third balance sheet at the start of the comparative period and the provision of
associated explanatory notes are necessary. The amendments to IAS 1 clarify that a third balance sheet is only
required when
(a) a company retroactively applies principles of accounting and valuation or retroactively adjusts or reclassifies
balance sheet items and
(b) retroactive modification, adjustment or reclassification significantly affects the information in the third balance
sheet.
Moreover, it states that explanatory notes on the third balance sheet are unnecessary.

156
In the current financial year the Group has carried out a change to its accounting policy which has had a significant
impact on the information in the consolidated balance sheet as at 1 January 2012. In accordance with the amended
IAS 1, the Group has therefore drawn up a third balance sheet as at 1 January 2012. Explanatory notes that go beyond
the requirements of IAS 8 have not been included.
IAS 16 PROPERTY, PLANT AND EQUIPMENT: CLASSIFICATION OF MAINTENANCE/SPARE PARTS
Maintenance devices will be accounted for in the future as per IAS 16.8, unless they are, as expected, used for more
than one period. Otherwise they represent inventories.
IAS 32 FINANCIAL INSTRUMENTS: DISCLOSURE AND PRESENTATION
Clarification of IAS 32 35a that the accounting for tax effects for distributions to equity investors and for costs related
to an equity transaction must be in accordance with IAS 12. This involves the removal of a redundancy.
IAS 34 INTERIM FINANCIAL REPORTING: TOTAL ASSETS OF THE SEGMENTS
Clarification in IAS 34.16A (iv) with regard to the total assets of the segments in the interim financial reporting. These
only need to be represented if the assets of the responsible business instance are available and differ substantially
from the value in the accounts for the last financial year.
IFRIC 20 ACCOUNTING OF STRIPPING COSTS IN MINING (SINCE 1 JANUARY 2013)
The interpretation refers exclusively to stripping costs during the dismantling phase of an open cast mine. The wide-
ranging accounting treatment of these in practice means that uniform guidelines are required. IFRIC 20 describes the
capitalisation requirements for stripping costs and initial or subsequent measurement. Insofar as the benefits of strip-
ping are considered inventories, the associated costs are to be capitalised as inventories (IAS 2). If the stripping results
in improved access to the ores or minerals that can be extracted, the cost of extraction may be included as a non-cur-
rent asset. The interpretation is to be applied to stripping costs incurred at the beginning of the earliest illustrated
reporting period or afterwards.
The amendments or new announcements had no or no material effects on the presentation of the net assets, financial
position and results of operations of the Group.
In 2013, the IASB issued standards and interpretations of and amendments to existing standards not yet compulsory
for consolidated financial statements in this period.
BALANCE SHEET
Amendment/standard Date of publication
Date of adoption
under EU law Date of application EU
IFRS 10 Consolidated financial statements 12 May 2011 11 December 2012 1 January 2014
IFRS 11 Joint Arrangements 12 May 2011 11 December 2012 1 January 2014
IFRS 12 Disclosures of Interests in Other Entities 12 May 2011 11 December 2012 1 January 2014
IAS 27 Separate Financial Statements 12 May 2011 11 December 2012 1 January 2014
IAS 28 Investments in associates 12 May 2011 11 December 2012 1 January 2014
Details of the recoverable amount for non-financial
assets (amendments to IAS 36) 29 May 2013 20 December 2013 1 January 2014
Renovation of derivatives and continuation of accounting
for hedging instruments (amendments to IAS 39) 27 June 2013 20 December 2013 1 January 2014
Transitional guidelines (amendments to IFRS 10,
IFRS 11 and IFRS 12) 28 June 2012 4 April 2013 1 January 2014
Investment companies (amendments to IFRS 10,
IFRS 12 and IAS 27) 31 October 2012 20 November 2013 1 January 2014
Offsetting of financial assets and liabilities
(amendments to IAS 32) 16 December 2011 13 December 2012 1 January 2014

157
The official announcements that did not yet have to be applied in 2013 will be implemented in the year in which their
application becomes compulsory for the first time. The effects of these individual amendments are being examined
by the Group. Due to the switch of the joint ventures from proportionate consolidation to equity accounting in 2013, no
significant impact on the Group is expected from the first-time application of IFRS 11.
The following standards as well as interpretations of and amendments to existing standards were issued by IASB.
However, their application was not yet compulsory for the preparation of the consolidated financial statements dated
31 December 2013. Application requires that they are endorsed by the EU within the scope of the IFRS endorsement
process.
Amendment/standard Date of publication
Anticipated date of
adoption into EU law
IASB date of
application
IFRS 9 Financial Instruments and subsequent
amendments (Amendments to IFRS 9 and IFRS 7)
2 November 2009/
16 December 2011 postponed –
Defined Benefit Plans: Employee Contributions
(Amendments to IAS 19 21 November 2013 Q3/2014 1 July 2014
Annual Improvements to IFRSs 2010-2012 Cycle 12 December 2013 Q3/2014 1 July 2014
Annual Improvements to IFRSs 2011-2013 Cycle 12 December 2013 Q3/2014 1 July 2014
IFRIC Interpretation 21 Levies 20 May 2013 Q2/2014 1 January 2014
The official announcements that did not yet have to be applied in 2013 will be implemented in the year in which their
application becomes compulsory for the first time. The effects of these individual amendments are being examined
by the Group.
SIGNIFICANT ACCOUNTING POLICIES
REVENUE AND EXPENSE RECOGNITION
Revenue and other operating income are recognised once the relevant service has been rendered or once the risk has
passed to the customer. Operating expenses are recognised once the service has been utilised or at the time when
they are booked through profit and loss. Interest income and expense are accrued.
INTANGIBLE ASSETS
Intangible assets relate exclusively to software purchased by Deutsche EuroShop AG. Additions are measured at cost.
These are amortised at 20% using the straight-line method over the expected useful life of five years. The method of
depreciation and the depreciation period are reviewed annually at the end of each financial year.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is reported at cost, less scheduled depreciation and, where applicable, unscheduled
write-downs (impairment charges).
Operating and office equipment comprises company cars, office equipment, leasehold improvements, fittings and tech-
nical equipment belonging to Deutsche EuroShop AG, and is depreciated using the straight-line method over three to
13 years. The method of depreciation and the depreciation period are reviewed annually at the end of each financial year.

158
INVESTMENT PROPERTIES
Under IAS 40, investment property must initially be measured at cost at the date of acquisition. Property that is under
construction and that is intended to be used as investment property following its completion also falls under the scope
of IAS 40. Property held as a financial investment can either be recognised at amortised cost (cost model) or using the
fair-value model.
Subsequently, all properties must be measured at their fair value and the annual net changes recognised in income
under measurement gains/losses (recurring fair value assessment). Investment property is property held for the long
term to earn rental income or capital gains. Under IAS 40, investment property measured using the fair value model
is no longer depreciated.
As in previous years, the fair values of the properties in the period under review were determined by the Feri Euro-
Rating Services AG and GfK GeoMarketing GmbH appraisal team using the discounted cash flow (DCF) method. In
accordance with the DCF method, future cash flows from the property in question are discounted back to the meas-
urement date. In addition, the net income from the property is determined over a detailed planning period of ten years.
A resale value is forecast for the end of the ten-year detailed planning phase. The net income is then capitalised over
the remaining life. In a second step, the resale value is discounted back to the measurement date.
Averaged across all properties, 10.9% (2012: 11.0%) of rental income is deducted for management and administrative
costs, with the result that net income equates to 89.1% (2012: 89.0%) of rental income. Actual management and admin-
istrative costs amounted to 9.5% of rental income in the year under review (2012: 10.3%).
The capitalisation rate applied comprises a forecast yield on a ten-year German federal government bond and a pre-
mium that takes account of the individual risk profile of the property. Around 150 individual indicators are used to deter-
mine the risk profile. These include a forecast of population trends over the long term, the rate of employment and the
resulting effects on retail demand, trends in the competitive environment and construction activity.
The discount rate averaged 6.65%, compared with 6.67% in the previous year. It is composed of an average yield of
4.24% on a ten-year German federal government bonds (2012: 4.30%) and an average risk premium of 2.41% (2012:
2.37%). 2,37 %).
On the basis of the expert appraisals, the property portfolio has a net initial yield of 5.97% for financial year 2014,
compared with 5.98% in the previous year.
There is no differentiation between the domestic and international operations, as the differences are not material.
Borrowing and initial rental costs that are directly attributable to the acquisition, construction or production of a qual-
ifying asset are included in the cost of that asset until the time at which the asset is largely ready for its intended use.
Income realised from the temporary investment of specifically borrowed funds up to the point when these are used to
obtain qualifying assets is deducted from the capitalisable costs of these assets.
All other borrowing costs are recognised in income in the period in which they occur.
Maintenance measures relating to property, plant and equipment are recognised as an expense in the financial year in
which they occur.

159
No appraisal report was produced for the properties owned by CASPIA Investments Sp. z o.o., Warsaw, due to their lesser
importance. The properties were also recognised at market value in accordance with IAS 40.
Details and information on the levels of the fair value of the Group’s investment property as at 31 December 2013 are
shown below as per IFRS 13:
Level 1 Level 2 Level 3
Investment Properties 2,962,163
No reclassifications between the levels of the hierarchy have been made in the current financial year.
LEASE AGREEMENTS
In line with IAS 17, the tenancy agreements in the Deutsche EuroShop Group are classified as operating leases. The
operating lease agreements relate to investment property owned by the Group with long-term leases. Rental income
from operating leases is recognised in income on a straight-line basis over the term of the corresponding lease. The
lessee has no opportunity to acquire the property at the end of the term.
FINANCIAL INSTRUMENTS
Financial assets and liabilities are recognised in the consolidated balance sheet when the Group becomes a party to
the contractual provisions governing the financial instrument.
Financial instruments are generally recognised at fair value. The fair value is the price that would in an orderly trans-
action between market participants on the measurement date have been received for the sale of an asset or paid for
the transfer of a liability. When measuring the fair value it is assumed that the transaction underlying the price is taking
place in a main market to which the Group has access. The price is calculated on the basis of the assumptions that
market participants would make when determining the price.
When determining fair value, three assessment categories are differentiated in accordance with IFRS 13:
Level 1: At the first level of the “fair value hierarchy”, fair values are determined using publicly quoted market prices, as
the best-possible objective indication of the fair value of a financial asset or liability can be observed on an active
market.
Level 2: If there is no active market for an instrument, a company determines the fair value using measurement models.
These models include use of the most recent arm’s-length transactions between knowledgeable and willing
parties, comparison with the current fair value of another, essentially identical financial instruments, use of
the discounted cash flow method and option pricing models. The fair value is estimated on the basis of the
results of a method of measurement that uses data from the market to the greatest possible extent and is
based as little as possible on company-specific data.
Level 3: The measurement models used for this level are also based on parameters that are not observable on the
market.
€ THOUSAND

160
For financial instruments regularly recorded at fair value, a reassessment at the end of the financial year determines
whether there has been a regrouping between the hierarchy levels. For financial instruments recognised at amortised
cost the fair value is determined on the basis of expected cash flows, using the risk and maturity-congruent reference
interest rates prevailing on the balance sheet date.
A. DERIVATIVE FINANCIAL INSTRUMENTS
Derivatives that qualify for hedge accounting in accordance with IAS 39 are used to hedge interest rate risks. These
are fixed-rate swaps to limit the interest rate risk of variable interest rate loans, which have terms extending to 2026.
The interest rate hedges are recognised at fair value (recurring fair value assessment) under “Other assets” or “Other
liabilities”. Changes are recognised directly in equity, provided that the conditions of the underlying and hedge trans-
action are identical. Hedge effectiveness tests are regularly conducted. If the effectiveness between the basic and the
hedging transaction is absent, the hedging instrument will be recognised as a derivative in profit or loss at fair value.
Present value is calculated based on discounted cash flows using current market interest rates. The final maturities
of the interest rate hedges and loan agreements are identical.
B. NON-CURRENT FINANCIAL ASSETS
Non-current financial assets are classified as available for sale and include an investment in a Dutch corporation that
is a joint venture controlled by Deutsche EuroShop jointly with partner companies. As Deutsche EuroShop, under the
provisions of the shareholders’ agreement, exercises neither significant influence nor control over this company, the
investment is measured at fair value (recurring fair value assessment) in line with the provisions of IAS 39. The holding
company has sold its major assets in the year under review. The carrying amount of the investment is essentially the
pro rata credit balance with banks.
C. RECEIVABLES AND OTHER CURRENT ASSETS
Receivables and other current assets are recognised at amortised cost less write-downs. Allowances are established
for trade receivables if it is no longer certain that payment will be received. This is reviewed on a case-by-case basis
on the balance sheet date. They are written off if the receivable becomes uncollectable.
D. RIGHT TO REDEEM OF LIMITED PARTNERS
The distinction between equity and liabilities is set out in IAS 32 Financial Instruments: Disclosure and Presentation.
In accordance with this standard, the equity interests of third-party shareholders in commercial partnerships are
reclassified as liabilities due to the shareholders’ potential right of redemption. According to sections 131 et seq. HGB,
shareholders in commercial partnerships have an ordinary legal right of termination of six months with effect from
the end of the financial year, which the shareholders’ agreement can define in greater detail, but not exclude. As a
result of this stipulation, a liability rather than equity is recognised in the balance sheet. This liability must be meas-
ured at fair value.
E. FINANCIAL LIABILITIES
Liabilities to banks/bank loans and overdrafts are reported at amortised cost. Discounts are deducted, which under
IAS 39 must be amortised over the term of the loan agreement and recognised annually as an expense.
The debt component of convertible bonds is measured using the market interest rate for a similar, non-convertible bond.
This debt component is measured as a liability at amortised cost using the effective interest method until converted or
repayment becomes due. The remaining proceeds from the issue represent the value of the conversion right. This is
recognised in equity within the capital reserves. The financial liability increases over time, with an effect on net income,
and comes to an amount equalling the difference between the actual interest expense and the nominal interest rate.

161
F. TRADE PAYABLES
Trade payables are recognised at their repayment amount.
G. OTHER LIABILITIES
Other liabilities are recognised at amortised cost.
H. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash and bank balances (terms of up to three months) at their principal amounts.
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Shares in associates and joint ventures are recorded in the balance sheet at investment cost, altered to reflect changes
in the Group’s share of the associate’s/joint venture’s equity after the acquisition date. The Group assesses at each
balance sheet date whether there is evidence of a need for impairment in relation to the amortised carrying amounts
of the shares. Please also note the explanations of the “Changes in accounting and valuation methods”.
DEFERRED TAXES
In accordance with IAS 12, deferred taxes are recognised for all differences between the tax accounts and the IFRS bal-
ance sheet, using the currently enacted tax rate. Currently, deferred taxes are primarily formed on the differences between
the IFRS carrying amounts of the properties and their carrying amounts for tax purposes. A uniform corporation tax rate
of 15% plus the solidarity surcharge of 5.5% was used for German companies, and in some cases a rate of 16.45% for
trade tax. The respective local tax rates were applied for foreign companies. In accordance with IAS 12.74, deferred
tax assets on existing loss carryforwards are offset against deferred tax liabilities.
OTHER PROVISIONS
Under IFRS, other provisions may only be recognised if a present obligation exists towards a third party and payment
is more likely than not. Non-current provisions are discounted.

162
NOTES TO THE CONSOLIDATED BALANCE SHEET –
ASSETS
1. INTANGIBLE ASSETS
CONCESSIONS, INDUSTRIAL AND SIMILAR RIGHTS AND LICENCES IN SUCH RIGHTS AND ASSETS
2013 2012
Costs as at 1 January 64 64
Additions 4 9
Disposals -4 -9
as at 31 December 64 64
Depreciation as at 1 January -48 -44
Additions -11 -12
Disposals 3 8
as at 31 December -56 -48
Carrying amount at 1 January 16 20
Carrying amount at 31 December 8 16
This item consists mainly of software licences.
2. PROPERTY, PLANT AND EQUIPMENT
OTHER EQUIPMENT, OPERATING AND OFFICE EQUIPMENT
2013 2012
Costs as at 1 January 205 204
Additions 361 2
Disposals -36 -1
as at 31 December 530 205
Depreciation as at 1 January -93 -67
Additions -54 -28
Disposals 30 2
as at 31 December -117 -93
Carrying amount at 1 January 112 137
Carrying amount at 31 December 413 112
This includes the office equipment of Deutsche EuroShop AG, two company vehicles and tenant improvements.
€ THOUSAND
€ THOUSAND

163
3. INVESTMENT PROPERTIES
2013 2012
Carrying amount at 1 January 2,824,133 2,596,131
Additions 18,127 11,724
Disposals from deconsolidations -333,370 0
Additions to basis of consolidation 392,735 179,760
Unrealised changes in fair value 60,538 36,518
Carrying amount at 31 December 2,962,163 2,824,133
The properties are secured by mortgages. There are land charges in the amount of €1,393,203 thousand (previous
year: €1,375,658 thousand). The rental income of the properties valued in accordance with IAS 40 was €187,987 thou-
sand (previous year: €178,161 thousand). Directly associated operating expenses were €17,775 thousand (previous
year: €18,485 thousand).
Additions mainly include ongoing investments in portfolio properties.
Disposals from deconsolidations mainly concern the Stadt-Galerie Passau and Immobilienkommanditgesellschaft FEZ
Harburg, which on 1 January 2013 were switched to the equity-accounted method.
The increased shareholding in Altmarkt-Galerie Dresden KG means that since 1 May 2013 the company has been fully
consolidated and reported as an addition to the basis of consolidation.
Unrealised changes in market value relate to appreciation and depreciation in accordance with IAS 40.
4. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
2013 2012
Carrying amount at 1 January 321,534 326,699
Additions for equity-accounted companies 148,949 0
Deposits/withdrawals -21,188 -17,117
Share of profit/loss 27,024 14,344
Appreciations/depreciations recognised directly in equity 670 -2,392
Disposals -135,082 0
Carrying amount at 31 December 341,907 321,534
Stadt-Galerie Passau and Immobilienkommanditgesellschaft FEZ Harburg were switched over to the equity-accounted
method on 1 January 2013 and are included in the additions.
This item also includes dividend distributions, share in the profits/losses and other equity changes of the companies
concerned.
In the year under review the shares in a property company were sold. The increased shareholding in Altmarkt-Galerie
Dresden KG means that since 1 May 2013 the company has been fully consolidated and is included under disposals
at €134,639 thousand.
€ THOUSAND
€ THOUSAND

164
5. OTHER FINANCIAL ASSETS
2013 2012
Costs as at 1 January 15,381 15,381
Additions 34,519 0
Disposals -15,381 0
as at 31 December 34,519 15,381
Amortisation/impairment losses and reversals as at 1 January 14,912 12,434
Reversals of impairment losses 3,606 2,478
Additions 0 0
Disposals -18,518 0
as at 31 December 0 14,912
Carrying amount at 1 January 30,293 27,815
Carrying amount at 31 December 34,519 30,293
During the reporting year, a reversal of impairment losses, recognised directly in equity, on the stake in Ilwro Joint
Venture Sp. z o.o. was made in the amount of of €3,606 thousand.
In the year under review, the investment in Ilwro Joint Venture Sp. zo.o. was included in Ilwro Holding B.V. at fair value
and contributions of €620 thousand made.
6. OTHER NON-CURRENT ASSETS
31.12.2013 31.12.2012
Other non-current assets 155 312
155 312
This item consists mainly of the present value of a non-current receivable of €127 thousand (previous year:
€282 thousand) belonging to our Polish property company.
7. TRADE RECEIVABLES
31.12.2013 31.12.2012
Trade receivables 6,880 4,760
Allowances for doubtful accounts -1,285 -988
5,595 3,772
Receivables result primarily from rental invoices and services for which charges are passed on. These were predomi-
nantly paid at the time the consolidated financial statements were prepared. The amounts recognised at the reporting
date are protected by means of guarantees, cash security deposits and letters of comfort.
€ THOUSAND
€ THOUSAND
€ THOUSAND

165
8. OTHER CURRENT ASSETS
31.12.2013 31.12.2012
Value added tax receivables 230 43
Deductible withholding tax on dividends/solidarity surcharge 0 136
Interest rate swaps 207 207
Other current assets 5,856 5,996
6,293 6,382
Other current assets primarily consist of other receivables from tenants and prepaid costs to protect locations.
RECEIVABLES
Total Up to 1 year Over 1 year
Trade receivables 5,595 5,595 0
(3,772) (3,772) (0)
Other assets 6,448 6,293 155
(6,694) (6,382) (312)
12,043 11,888 155
Previous year’s figure in brackets (10,466) (10,154) (312)
MATURITY OF TRADE RECEIVABLES AND OTHER ASSETS
Carrying amount Not overdue
Trade receivables 5,595 5,595
(3,772) (3,772)
Other assets 6,448 6,448
(6,694) (6,694)
12,043 12,043
Previous year’s figure in brackets (10,466) (10,466)
9. OTHER FINANCIAL INVESTMENTS
31.12.2013 31.12.2012
Time deposits with a term of over 3 months 3,000 0
€ THOUSAND
€ THOUSAND
€ THOUSAND
€ THOUSAND

166
10. CASH AND CASH EQUIVALENTS
31.12.2013 31.12.2012
Short-term deposits/time deposits 24,378 29,462
Current accounts 16,419 131,531
Cash 13 13
40,810 161,006
NOTES TO THE CONSOLIDATED BALANCE SHEET –
LIABILITIES
11. EQUITY AND RESERVES
Changes in equity are presented in the statement of changes in equity.
The share capital is €53,945,536 and is composed of 53,945,536 no-par-value registered shares.
The notional value of each share is €1.00.
According to Article 5 of the Articles of Association, the Executive Board is still authorised, subject to the approval of
the Supervisory Board, to increase the Company’s share capital by up to a total of €26,972,768 on one or multiple occa-
sions until 19 June 2018 by issuing no-par-value registered shares against cash and/or non-cash contributions
(approved capital 2013).
The Executive Board is authorised, subject to the approval of the Supervisory Board and until 15 June 2016, to issue
convertible bonds with a total nominal value of up to €200,000,000 and maturities of up to ten years and to grant the
holders of the respective, equally privileged, bonds conversion rights to new no-par-value shares in the Company up
to a total of 10,000,000 shares (€10.0 million) in accordance with the detailed provisions of the terms and conditions
for convertible bonds (“bond conditions”). (conditional capital 2011). The convertible bonds may also pay a variable
rate of interest, in which case, as with a participating bond, the interest may be dependent in full or in part on the level
of the Company’s dividend.
The parent company of the Group, Deutsche EuroShop AG, is reporting an unappropriated surplus of €67,432 thousand.
The Executive Board and the Supervisory Board will propose to distribute this amount as a dividend of €1.25 per share
at the Annual General Meeting on 18 June 2014.
€64,735 thousand of the previous year’s unappropriated surplus of €80,643 thousand was distributed to the share-
holders. The dividend paid was €1.20 per share.
The capital reserves contain amounts in accordance with section 272 (2) nos. 1, 2 and 4 of the Handelsgesetzbuch
(HGB – German Commercial Code). The capital reserves also contain deferred tax assets at the expense of the capital
increase amounting to €1,441 thousand.
Retained earnings consist of the remeasurement reserves and currency items and accumulated profits carried for-
ward at the time of transition to IFRS.
€ THOUSAND

167
Other total income is divided into the following components:
Before taxes Taxes Net
Measurement of investments (AfS) IAS 39 3,606 0 3,606
Change of investments (AfS) IAS 39 -15,799 0 -15,799
Cash flow hedge 11,217 -2,869 8,348
Investments accounted for using the equity method 7,519 -2,427 5,092
Other 0 -58 -58
6,543 -5,354 1,189
Before taxes Taxes Net
Measurement of investments (AfS) IAS 39 2,478 0 2,478
Cash flow hedge -12,073 917 -11,156
Investments accounted for using the equity method -2,395 438 -1,957
Other 0 -11 -11
-11,990 1,344 -10,646
12. NON-CURRENT AND CURRENT FINANCIAL LIABILITIES
31.12.2013 31.12.2012
Non-current bank loans and overdrafts 1,295,996 1,184,360
Current bank loans and overdrafts 97,207 191,298
Bonds 93,556 91,943
1,486,759 1,467,601
Bank loans and overdrafts are recognised at amortised cost on the balance sheet date. The present value of loans is
redetermined at the reporting date. To do so, the annuities due up to this date, together with any residual amount
according to the redemption schedule are discounted at the reporting date at market rates of interest plus a margin.
This recurring fair value measurement is in accordance with Level 2 of the IFRS 13 fair value hierarchy.
The fair value of the bank loans and overdrafts at the reporting date is €1,446,517 thousand (previous year:
€1,470,844 thousand).
Bank loans and overdrafts relate to loans raised to finance property acquisitions and investment projects. Land charges
on Company properties totalling €1,393,203 thousand (previous year: €1,375,658 thousand) serve as collateral.
Discounts are amortised over the term of the loan. In the year under review, €1,531 thousand (previous year:
€2,141 thousand) was recognised in income.
2013 IN € THOUSAND
2012 IN € THOUSAND
€ THOUSAND

168
Twelve of the 19 loan agreements currently contain arrangements regarding covenants. There are a total of 18 different
conditions on different debt service cover ratios (DSCR), interest cover ratios (ICR), changes in rental income, the equity
ratio and loan-to-value ratios (LTV). The credit conditions have not to date been breached, and according to the current
planning will not be breached in 2014–2016 either.
Deutsche EuroShop issued a convertible bond on 14 November 2012. Convertible bonds with a five-year maturity and
total value of €100 million were placed. The initial conversion price is €33.79; the coupon is 1.75% per year and is pay-
able semi-annually in arrears. The convertible bonds were issued at 100% of their nominal value of €100,000.00 each
and can initially be converted to 2,959,455 shares in Deutsche EuroShop AG in accordance with the conversion ratio
and the terms and conditions of the convertible bonds. The proceeds from the issue amounted to €100 million. No con-
version rights were exercised by 31 December 2013.
The amount of the convertible bond was divided into equity and debt components. The equity component accounted
for a total amount of €7,140 thousand which was placed in capital reserves.
13. DEFERRED TAX LIABILITIES
as at
01.01.2013 Utilisation Reversal Addition
as at
31.12.2013
Deferred taxes on properties 194,316 0 -14,556 28,666 208,426
Deferred taxes on derivatives 0 0 2,300 -3,799 -1,499
Deferred taxes recognised directly
in equity -13,791 0 5,355 0 -8,436
180,525 0 -6,901 24,867 198,491
Deferred tax liabilities relate primarily to properties reported at fair value in accordance with IAS 40. At the reporting
date, they totalled €220,754 thousand (previous year: €206,012 thousand) and were partially offset by deferred tax
assets on tax loss carryforwards of €12,329 thousand (previous year: €11,696 thousand).
The deferred tax on derivatives concerns an interest rate swap, which is to be measured through profit and loss
following the acquisition of the remaining shares in Altmarkt-Galerie Dresden on 1 May 2013.
The deferred taxes are formed for interest rate swaps, which due to an effective hedging relationship with the under-
lying transaction are recognised directly in equity.
From 2014 another property company fulfils the conditions for taking advantage of the extended trade tax reduction.
For this reason, the previously formed deferred trade tax provisions in the amount of €12,619 thousand can be
released.
as at
as at
31.12.2013
Deferred taxes on domestic
companies 153,427 0 -6,901 22,317 168,843
Deferred taxes on foreign companies 27,098 0 0 2,550 29,648
180,525 0 -6,901 24,867 198,491
€ THOUSAND
€ THOUSAND

169
14. TRADE PAYABLES
31.12.2013 31.12.2012
Construction services 976 418
Other 2,375 1,717
3,351 2,135
15. TAX LIABILITIES
as at
as at
31.12.2013
Income taxes 12,731 12,646 12 423 496
Real estate transfer tax 11,750 11,210 0 0 540
Real property tax 88 0 0 233 321
24,569 23,856 12 656 1,357
16. OTHER PROVISIONS
as at
01.01.2013 Utilisation
Addi-
tions/dis-
posals
– consolida-
tion basis Reversal Addition
as at
31.12.2013
Maintenance and construction
services already performed but
not yet invoiced 3,179 2,546 43 553 2,731 2,854
Fees 150 150 0 0 2 2
Other 9,166 7,863 10 506 3,141 3,948
12,495 10,559 53 1,059 5,874 6,804
Other provisions contain the present value (€1,069 thousand) of a long-term incentive plan which was contractually
agreed between the Executive Board and employees of Deutsche EuroShop AG with effect from 1 July 2010. The term
is five years, and the plan is based on the performance of the Company’s market capitalisation by 30 June 2015. Please
also refer to the details in the remuneration report, which is part of the management report.
All other provisions have a term of up to one year.
€ THOUSAND
€ THOUSAND
€ THOUSAND

170
17. OTHER CURRENT LIABILITIES
31.12.2013 31.12.2012
Value added tax 2,414 3,751
Rental deposits 1,001 895
Service contract liabilities 1,045 404
Debtors with credit balances 685 77
Other 9,489 6,334
14,634 11,461
Other mainly comprises liabilities for heating and ancillary costs, prepaid rent for the following year and tax payments
that were not made until the beginning of 2014.
18. OTHER NON-CURRENT LIABILITIES
31.12.2013 31.12.2012
Interest rate swaps 40,481 42,339
Other 615 345
41,096 42,684
In connection with borrowing, interest rate hedges were concluded to hedge against higher capital market interest
rates (interest rate swaps). Their present value totalled €40,481 thousand as at the reporting date.
LIABILITIES
Total Current Non-current
Financial liabilities 1,486,759 97,207 1,389,552
(1,467,601) (191,298) (1,276,303)
Trade payables 3,351 3,351 0
(2,135) (2,135) (0)
Other liabilities 55,730 14,634 41,096
(54,145) (11,461) (42,684)
of which taxes 4,080 4,080 0
(3,865) (3,865) (0)
1,545,840 115,192 1,430,648
Previous year’s figure in brackets (1,523,881) (204,894) (1,318,987)
€ THOUSAND
€ THOUSAND
€ THOUSAND

171
NOTES TO THE CONSOLIDATED
INCOME STATEMENT
19. REVENUE
2013 2012
Minimum rental income 185,818 174,640
Turnover rental income 1,591 2,571
Other 578 950
187,987 178,161
of which directly attributable operating expenditure in accordance with IAS 40
Investment Properties 187,987 178,161
Other revenue relates primarily to compensation for use, residential leases and settlement payments made by former
tenants.
The rental income reported here derives from operating leases and relates to properties held as an investment with
long-term leases. The future minimum leasing payments from non-terminable rental agreements have the following
maturities:
2013 2012
Maturity within 1 year 194,474 186,576
Maturity from 1 to 5 years 635,747 632,234
Maturity after 5 years 366,143 368,939
1,196,364 1,187,749
20. PROPERTY OPERATING COSTS
2013 2012
Center marketing -2,636 -2,590
Operating costs that cannot be passed on -2,297 -1,277
Maintenance and repairs -1,462 -4,057
Real property tax -651 -653
Insurance -312 -275
Write-downs of rent receivables -583 -626
Other -511 -505
-8,452 -9,983
Investment Properties -8,452 -9,983
€ THOUSAND
€ THOUSAND
€ THOUSAND

172
21. PROPERTY MANAGEMENT COSTS
2013 2012
Center management / agency agreement costs -9,323 -8,502
Investment Properties -9,323 -8,502
22. OTHER OPERATING INCOME
2013 2012
Income from the reversal of provisions 1,059 692
Exchange rate gains 231 903
Other 1,547 1,138
2,837 2,733
23. OTHER OPERATING EXPENSES
2013 2012
Real estate transfer tax -22 -2,937
Personnel expenses -2,153 -2,135
Legal, consulting and audit expenses -1,238 -1,735
Ancillary financing costs 0 -1,391
Exchange rate losses -331 -367
Marketing costs -363 -399
Appraisal costs -277 -330
Supervisory Board compensation -312 -265
Write-downs -65 -40
Other -2,524 -1,231
-7,285 -10,830
Legal and consulting costs, tax consultant fees and audit expenses include €293 thousand (€328 thousand) in fees for
the audit of Group companies.
€ THOUSAND
€ THOUSAND
€ THOUSAND

173
24. INCOME FROM INVESTMENTS
2013 2012
Income from investments 16,688 1,400
The proceeds from the sale of Ilwro Sp. zo.o. as well as residual distributions for the previous year are recognised.
25. SHARES OF THE PROFIT OR LOSS OF ASSOCIATES AND JOINT VENTURES
ACCOUNTED FOR USING THE EQUITY METHOD
2013 2012
Profit / loss from equity-accounted associates 27,024 14,346
These are the share in the profits/losses of joint ventures and associates in which Deutsche EuroShop AG together
with third parties has a majority of the voting rights. These are six shopping centre companies and five smaller prop-
erty companies.
26. PROFIT / LOSS ATTRIBUTABLE TO LIMITED PARTNERS
2013 2012
Profit / loss attributable to limited partners -15,939 -15,271
27. MEASUREMENT GAINS / LOSSES
2013 2012
Unrealised changes in fair value 60,538 36,518
Profit/loss attributable to limited partners -4,492 -18,675
Ancillary acquisitions costs -64 -9,198
Excess of identified net assets acquired over cost of acquisition in accordance
with IFRS 3 (increased shareholdings) 0 5,289
55,982 13,934
€ THOUSAND
€ THOUSAND
€ THOUSAND
€ THOUSAND

174
28. INCOME TAX EXPENSE
2013 2012
Current tax expense -2,362 -8,483
Domestic deferred tax expense -11,636 28,791
Foreign deferred tax expense -2,572 -1,246
-16,570 19,062
In measuring deferred taxes, the tax rates applicable in accordance with IAS 12 are those valid under current legis-
lation at the date at which the temporary differences will probably reverse.
In 2013, a corporate tax rate of 15% was used for the companies in Germany. In addition, a solidarity surcharge of 5.5%
on the calculated corporation tax and, in part, 16.45% in trade tax were recognised.
The respective local tax rates were applied for foreign companies.
Taxes on income and earnings include the reversal of latent trade tax liabilities in the amount of €12.6 million in
deferred trade tax liabilities which had been formed in previous years.
TAX RECONCILIATION
Income taxes in the amount of €-16,570 thousand in the year under review are derived as follows from an expected
income tax expense that would have resulted from the application of the parent company’s statutory income tax rate
to the profit before tax. This was calculated using a tax rate of 32.28%.
2013 2012
Consolidated profit before income tax 187,613 103,422
Theoretical income tax 32.28% -60,561 -33,379
Tax rate differences for foreign Group companies 1,226 2,190
Tax rate differences for domestic Group companies 20,568 2,057
Tax-free income/non-deductible expenses 4,705 531
Effect of tax rate changes 12,619 49,357
Aperiodic tax income 4,843 0
Other 30 -1,694
Current income tax -16,570 19,062
After fulfilling the requirements of the extended trade tax reduction for one more property company, a portion of the
deferred trade tax provisions built up during previous years in the amount of €12,619 thousand could be released.
Aperiodic tax income contains a trade tax refund in the amount of €2,334 thousand.
In financial year 2013, the effective income tax rate was 18.1%. This figure does not include the effect from tax rates
changes and the aperiodic tax income amounting to €17,462 thousand.
€ THOUSAND
€ THOUSAND

175
29. NOTES TO THE CONSOLIDATED CASH FLOW
STATEMENT
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
The cash flow statement has been prepared in accordance with IAS 7 and is broken down into operating cash flow and
cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities. Cash
and cash equivalents consists of cash, bank balances and short-term deposits.
COMPOSITION OF CASH AND CASH EQUIVALENTS
31.12.2013 31.12.2012
Cash and cash equivalents 40,810 161,006
OPERATING CASH FLOW
After adjustment of the annual profit for non-cash income and expenses, operating cash flow was €129,813 thousand.
All changes to cash flows from net finance costs are allocated to operating activities.
CASH FLOW FROM OPERATING ACTIVITIES
Changes in receivables, provisions and liabilities are allocated to cash flow from operating activities.
Cash outflows from operating activities includes, among others:
• interest income of €0.4 million (previous year: €0.5 million)
• interest expense of €56.1 million (previous year: €62.5 million)
• income taxes paid of €1.8 million (previous year: €1.0 million)
• net allocations to provisions of €4.8 million (previous year: €11.2 million)
CASH FLOW FROM INVESTING ACTIVITIES
Cash additions/disposals of non-current assets during the year are recognised.
In the year under review, investments totalling €18.1 million were made in the portfolio properties. In addition, invest-
ment in operating and office equipment totalled €0.4 million.
The purchase price for the shares in Altmarkt-Galerie Dresden amounted to €70.2 million and was paid at the end of
April 2013. Cash and cash equivalents of €10.8 million were recognised during initial consolidation.
€ THOUSAND

176
CASH FLOW FROM FINANCING ACTIVITIES
Moreover, loan reductions resulted in a cash outflow in the amount of €59.7 million.
Payments to third-party shareholders include the distributions paid of €12.3 million.
In financial year 2013, a dividend of €64.7 million was paid to the shareholders.
SEGMENT REPORTING
As a holding company, Deutsche EuroShop AG holds equity interests in shopping centers in the European Union. The
investees are pure real-estate shelf companies without staff of their own. Operational management is contracted out
to external service providers under agency agreements, so that the companies’ activities are exclusively restricted to
asset management. The companies are operated individually.
Due to the Company’s uniform business activities within a relatively homogeneous region (the European Union), and
in accordance with IFRS 8.12, separate segment reporting is presented in the form of a breakdown by domestic and
international results.
As the Group’s main decision-making body, the Deutsche EuroShop AG Executive Board largely assesses the perfor-
mance of the segments based on the EBT of the individual property companies. The valuation principles for the seg-
ment reporting correspond to those of the Group.
Intra-Group activities between the segments are eliminated in the reconciliation statement.
In view of the geographical segmentation, no further information pursuant to IFRS 8.33 is given.
BREAKDOWN BY GEOGRAPHICAL SEGMENT
Domestic International Reconciliation Total
Revenue 173,282 14,705 0 187,987
(previous year’s figures) (163,803) (14,358) (0) (178,161)
EBIT 156,577 13,435 -4,248 165,764
(previous year’s figures) (142,057) (13,507) -(3,985) (151,579)
Net interest income -49,587 -3,834 -3,958 -57,379
(previous year’s figures) -(56,926) -(3,881) -(1,759) -(62,566)
€ THOUSAND
€ THOUSAND
€ THOUSAND

177
Earnings before taxes (EBT) 155,064 7,142 25,407 187,613
(previous year’s figures) (90,025) (7,405) (5,992) (103,422)
Profits and losses for equity-accounted companies in the amount of €27,024 thousand are primarily disclosed in the
reconciliation statement, of which €19,529 thousand are domestic profit and losses and €7,495 thousand international
profit and losses.
Domestic International Total
Segment assets 3,172,348 222,515 3,394,863
(previous year’s figures) (3,128,778) (218,782) (3,347,560)
of which investment properties 2,746,320 215,843 2,962,163
(previous year’s figures) (2,610,110) (214,023) (2,824,133)
€ THOUSAND
€ THOUSAND

178
Other disclosures
30. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
CARRYING AMOUNTS, VALUATIONS AND FAIR VALUES ACCORDING TO MEASUREMENT CATEGORY
Balance sheet amount in line with IAS 39
Measurement
category pursu-
ant to IAS 39
Carrying
amount
31.12.2013 Amortised cost Costs
Fair value
recognised
in equity
Financial assets
Non-current financial assets** AfS 34,519 34,519
Trade receivables* LaR 5,595 5,595
Other assets* LaR 1,587 1,228 359
Other financial investments* HtM 3,000 3,000
Cash and cash equivalents* LaR 40,810 40,810
Financial liabilities
Financial liabilities* FLAC 1,486,759 1,486,759
Right to redeem of limited partners* FLAC 213,422 213,422
Trade payables* FLAC 3,351 3,351
Other liabilities* FLAC 8,508 8,508
Interest rate hedges not recognised in profit or loss* FLAC 31,007 31,007
Interest rate hedges recognised in profit or loss** FVTPL 9,474
Aggregated according to measurement category pursuant
to IAS 39:
Loans and receivables (LaR) 47,992 47,633 359
Held to maturity (HtM) 3,000 3,000
Available for sale (AfS) 34,519 0 34,519 0
Financial liabilities measured at amortised cost (FLAC) 1,743,047 1,712,040 31,007
Financial liabilities measured at fair value in income (FVTPL) 9,474
*
Corresponds to level 1 of the IFRS 7 fair value hierarchy
**
Corresponds to level 2 of the IFRS 7 fair value hierarchy
Investments measured using the equity method are reported at fair value. In the year under review, no additional
appreciations or depreciations were made as they are already included in the respective subsidiary’s net profit or loss
for the period.
Trade receivables, other assets as well as cash and cash equivalents and other financial investments with the excep-
tion of interest rate swaps – which are recognised at present value – predominantly have short residual terms. The
carrying amounts thus correspond to the fair value. The change in the present value of the long-term interest rate
swap recognised was €155 thousand (previous year: €140 thousand)
The long-term financial liabilities include obligations from convertible bonds that are measured at amortised cost
using the effective interest rate method. Interest expense incurred amounted to €3,363 thousand (previous year:
€483 thousand) and is recognised in net finance costs.
€ THOUSAND

179
Balance sheet amount in line with IAS 39
Fair value
recognised
in income
Fair value
31.12.2013
Carrying
amount
31.12.2012 Amortised cost Costs
Fair value
recognised
in equity
Fair value
recognised
in income
Fair value
31.12.2012
34,519 30,293 15,381 14,912 30,293
5,595 3,772 3,772 3,772
1,587 1,972 1,482 490 1,972
3,000 0 0
40,810 161,006 161,006 161,006
1,540,073 1,467,601 1,467,601 1,562,787
213,422 284,176 284,176 284,176
3,351 2,135 2,135 2,135
8,508 6,380 6,380 6,380
31,007 42,339 42,339 42,339
9,474 9,474
47,992 166,750 166,260 490 166,750
3,000 0 0 0
34,519 30,293 0 15,381 14,912 30,293
1,796,361 1,802,631 1,760,292 42,339 1,897,817
9,474 9,474
Bank loans and overdrafts have short and long-term durations and are recognised at amortised cost. The fair value
for Group loans is given in the notes under item 12 “Financial liabilities”. In total, interest expense of €57,827 thousand
(previous year: €63,066 thousand) is included in net finance costs.
Trade payables and other liabilities, with the exception of interest rate swaps – which are recognised at present value –
usually have short residual terms. The carrying amounts thus correspond to the fair value.
Interest on financial instruments, not recognised in profit or loss, is reported as interest income or interest expense.
Changes in the value of financial liabilities measured at fair value in profit or loss are reported under Other financial
expenses (€4,550 thousand). In the year under review, € 6.849 thousand from Other comprehensive income was trans-
ferred to the income statement.

180
The fair value of the liabilities listed above in level 2 was calculated in accordance with generally accepted valuation
methods based on the discounted cash flow method. The interest price and market price parameters applicable on
the reporting date were applied.
The profit/loss share of third-party shareholders of €15,939 thousand (previous year: €15,271 thousand) is also
included in net finance costs.
Impairment charges on receivables (€583 thousand) are recognised in the property operating costs.
RISK MANAGEMENT
In risk management, the emphasis is on ensuring compliance with the strategy and, building on this, on identifying
and assessing risks and opportunities, as well as on the fundamental decision to manage these risks. Risk manage-
ment ensures that risks are identified at an early stage and can then be evaluated, communicated promptly and miti-
gated. Risk analysis involves the identification and analysis of factors that may jeopardise the achievement of goals.
MARKET RISKS
LIQUIDITY RISK
The liquidity of Deutsche EuroShop Group is continuously monitored and planned. The subsidiaries regularly have suf-
ficient cash to be able to pay for their current commitments. Furthermore, credit lines and bank overdrafts can be
utilised at short notice.
The contractually agreed future interest and principal repayments of the original financial liabilities and derivative
financial instruments are as follows as at 31 December 2013:
Carrying amount
31.12.2013
Cash flows
2014
Cash flows
2015 to 2018
Cash flows
from 2019
Convertible bond 93,556 1,750 105,053 0
Bank loans and overdrafts 1,393,203 151,635 481,074 1,142,475
The amounts relate to all contractual commitments existing on the balance sheet date. The majority of the trade pay-
ables and other financial liabilities reported at the end of the financial year will fall due in 2013.
CREDIT AND DEFAULT RISK
There are no significant credit risks in the Group. The trade receivables reported on the reporting date were predom-
inantly paid up to the date of preparation of the financial statements. During the reporting year, write-downs of rent
receivables of €583 thousand (previous year: €626 thousand) were recognised under property operating costs.
The maximum default risk in relation to trade receivables and other assets totalled €12,043 thousand (previous year:
€10,466 thousand) as at the reporting date.
€ THOUSAND

181
CURRENCY AND MEASUREMENT RISK
The Group companies operate exclusively in the European Economic Area and conduct the greater part of their busi-
ness in euro. This does not entail currency risks.
A 25 bp change in a material parameter of real estate appraisals would have the following pre-tax impact on meas-
urement gains/losses:
Basis -0,25% +0,25%
Rate of rent increases 1.70% -111.5 116.8
Discount rate 6.65% 104.7 -99.6
Cost ratio 10.90% 9.7 -9.7
INTEREST RATE RISK
A sensitivity analysis was implemented to determine the effect of potential interest rate changes. Based on the finan-
cial assets and liabilities subject to interest rate risk on the balance sheet date, this shows the effect of a change on the
Group’s equity. Interest rate risks arose on the balance sheet date only for credit borrowed the associated interest rate
hedges. An increase in the market interest rate of 100 basis points would lead to an increase in equity of €17,444 thou-
sand (previous year: €19,112 thousand). The majority of the loan liabilities have fixed interest terms. On the reporting
date, loans totalling €215,500 thousand (previous year: €194,651 thousand) were hedged using derivative financial
instruments.
CAPITAL MANAGEMENT
The Group’s capital management is designed to maintain a strong equity base with the aim of ensuring that its ability
to repay its debts and its financial well-being are maintained in the future. The Group’s financial policies are also based
on the annual payment of a dividend.
31.12.2013 31.12.2012
Equity 1,642,371 1,606,090
Equity ratio (%) 48.4 48.0
Net financial debt 1,445,949 1,306,595
Equity is reported here including the redemption entitlements of shareholders.
Net financial debt is determined from the financial liabilities on the balance sheet date less cash and cash equivalents.
IN € MILLION
€ THOUSAND

182
31. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Joint ventures in which Deutsche EuroShop AG together with third parties has a majority of the voting rights have pre-
viously been proportionately included as joint ventures in the consolidated financial statements. The following com-
panies are affected by the retroactive switch to equity accounting:
• Altmarkt-Galerie Dresden KG, Hamburg (until 30 April 2013)
• Allee-Center Magdeburg KG, Hamburg
• CAK City Arkaden Klagenfurt KG, Hamburg
• EKZ Eins Errichtungs- und Betriebs Ges.m.b.H.&Co OG, Vienna
• Einkaufs-Center Pécs KG, Hamburg
Please also note the detailed explanations regarding “Changes in accounting and valuation methods”.
Immobilienkommanditgesellschaft FEZ Harburg KG and Stadt-Galerie Passau KG have also since 1 January 2013 been
accounted using the equity method after the voting trust agreement with a co-shareholder was revoked.
During the financial year, the equity-accounted joint ventures posted the following asset and liability items, expenses
and income:
31.12.2013 31.12.2012
Non-current assets 451,469 506,584
Current assets 5,282 12,565
Non-current liabilities 115,502 195,353
Current liabilities 2,970 5,942
Income 40,024 35,529
Expenses -13,407 -20,588
In addition, small property companies in which Deutsche EuroShop indirectly or directly has an interest are part of the
Group. Deutsche EuroShop exercises a controlling influence over these companies together with other shareholders.
However, they are negligible for the assets, financial and earnings position of the Group.
During the financial year, the equity-accounted associates posted the following asset and liability items, expenses and
income:
31.12.2013 31.12.2012
Non-current assets 8,603 8,551
Current assets 1,490 1,577
Non-current liabilities 0 5,940
Current liabilities 6,025 93
Income 774 826
Expenses -345 -1,416
€ THOUSAND
€ THOUSAND

183
32. EARNINGS PER SHARE
2013 2012
Group shareholders’ portion of profits/losses (€ thousand) 171,043 122,484
Weighted number of no-par value shares issued 53,945,536 51,934,893
Basic earnings per share (€) 3.17 2.36
Group shareholders’ portion of profits/losses (€ thousand) 171,043 122,484
Adjustment of interest expense for the convertible bond (€ thousand) 2,277 327
Profits/losses used to calculate the diluted earnings per share (€ thousand) 173,320 122,811
Weighted number of no-par value shares issued 53,945,536 51,934,893
Weighted adjustment of potentially convertible no-par value shares 2,909,710 326,935
Average weighted number of shares used to determine the diluted earnings per share 56,855,246 52,261,828
Diluted earnings per share (€) 3.05 2.35
BASIC EARNINGS PER SHARE:
Basic earnings per share are determined by dividing the net income for the period to which shareholders of Deutsche
EuroShop AG are entitled by the weighted average number of shares outstanding within the reporting period.
DILUTED EARNINGS PER SHARE:
The diluted earnings are calculated by taking the average number of shares outstanding and adding the number of
warrants granted in connection with the convertible bond. 2.9 million warrants existed during the year under review.
Due to the fact that the convertible bond was issued mid-year, the warrants issued in connection with the convertible
bond were recognised on a pro rata basis in 2012. It is anticipated that the convertible bonds will be exchanged for
shares in full. The profits/losses will be adjusted accordingly for interest expense and tax effects.

184
OTHER FINANCIAL OBLIGATIONS
There are other financial obligations of €81.7 million arising from service contracts.
There are financial obligations of €9.3 million which will arise in 2014 in connection with investment measures in our
shopping centers.
OTHER DISCLOSURES
An average of four (previous year: four) staff members were employed in the Group during the financial year.
EVENTS AFTER THE BALANCE SHEET DATE
No further significant events occurred between the balance sheet date and the date of preparation of the financial
statements.

185
The Supervisory Board and Executive Board
SUPERVISORY BOARD
a) Membership of other statutory supervisory boards
b) Membership of comparable supervisory bodies of business enterprises in Germany or other countries
Manfred Zaß, Königstein/Ts., Chairman
Banker
Dr. Michael Gellen, Cologne, Deputy Chairman
Independent lawyer
Thomas Armbrust, Reinbek
Member of Management of CURA Vermögensverwaltung G.m.b.H., Hamburg
a) C.J. Vogel Aktiengesellschaft für Beteiligungen, Hamburg (Chairman)
Platinum AG, Hamburg (Chairman)
TransConnect Unternehmensberatungs- und Beteiligungs AG, Munich (Chairman)
Verwaltungsgesellschaft Otto mbH, Hamburg
b) ECE Projektmanagement G.m.b.H.&Co. KG, Hamburg (Chairman)
Karin Dohm, Kronberg/Ts.
Head of Group External Reporting at Deutsche Bank AG, Frankfurt am Main
Dr. Jörn Kreke, Hagen (until 20.06.2013)
Businessman
a) Capital Stage AG, Hamburg
Douglas Holding AG, Hagen/Westphalia (Chairman)
b) Kalorimeta AG&Co. KG, Hamburg
Urbana AG&Co. KG, Hamburg
Dr. Henning Kreke, Hagen (since 20.06.2013)
Chairman of the Executive Board of Douglas Holding AG, Hagen/Westphalia
Reiner Strecker, Wuppertal
Managing Partner of Vorwerk&Co. KG, Wuppertal
b) akf Bank GmbH&Co. KG, Wuppertal
Klaus Striebich, Besigheim
Managing Director Leasing, Verwaltung ECE Projektmanagement G.m.b.H., Hamburg
b) Unternehmensgruppe Dr. Eckert GmbH, Berlin
MEC Metro-ECE Centermanagement GmbH&Co. KG, Düsseldorf
Alexander Otto, Hamburg
CEO, Verwaltung ECE Projektmanagement G.m.b.H., Hamburg
a) Verwaltungsgesellschaft Otto mbH, Hamburg
b) Peek&Cloppenburg KG, Dusseldorf

186
Dr. Bernd Thiemann, Münster
Management consultant
a) Deutsche Pfandbriefbank AG, Unterschleißheim (Chairman)
VHV Lebensversicherung AG, Hanover
Hypo Real Estate Holding AG, Unterschleissheim (Chairman)
VHV Vereinigte Hannoversche Versicherung a.G., Hanover
Wave Management AG, Hamburg (Deputy Chairman)
IVG Immobilien AG, Bonn
M.M. Warburg&Co. KG aA, Hamburg (Deputy Chairman)
Hannoversche Direktversicherungs AG, Hanover
b) Würth Gruppe, Künzelsau (Deputy Chairman)
Würth Finance International B.V., Amsterdam
EXECUTIVE BOARD
Claus-Matthias Böge, Hamburg
Executive Board Spokesman
a) Douglas Holding AG, Hagen/Westphalia (until 28.05.2013)
Bijou Brigitte modische Accessoires AG, Hamburg (Deputy Chairman) (since 25.06.2013)
Olaf G. Borkers, Hamburg
The remuneration of the members of the Supervisory Board totalled €312 thousand in the period under review (pre-
vious year: €265 thousand).
The remuneration of the Executive Board totalled €1,237 thousand (previous year: €1,193 thousand), including per-
formance-related remuneration of €677 thousand (previous year: €650 thousand). This remuneration is due on a short-
term basis.
€306 thousand (previous year: €305 thousand) was allocated to the provision for the Executive Board’s long-term
incentive plan (LTI). Accrued interest was €19 thousand.
For further details, please see the supplementary disclosures on remuneration in the management report.
CORPORATE GOVERNANCE
The Declaration of Conformity with the German Corporate Governance Code required by section 161 of the Aktien-
gesetz (AktG – German Public Companies Act) has been issued jointly by the Supervisory Board and the Executive
Board, and was made available to shareholders via publication on the Internet in November 2013.

187
RELATED PARTIES FOR THE PURPOSES OF IAS 24
Deutsche EuroShop AG’s subsidiaries, joint ventures and associates as well as the members of its Executive Board
and Supervisory Board are regarded as related parties for the purposes of IAS 24. The remuneration of the Super-
visory Board and the Executive Board is described in the “Supervisory Board and Executive Board” section and also in
the remuneration report part of the group management report.
Fees for service contracts with the ECE Group totalled €15,561 thousand (previous year: €16,719 thousand). This
amount was partially offset by income from lease agreements with the ECE Group in the amount of €5,655 thousand
(previous year: €5,797 thousand). Receivables from ECE were €3,982 thousand, while liabilities were €1,457 thousand.
Transactions with related parties involving the provision of goods and services were at standard market rates.
The Executive Board
Claus-Matthias Böge Olaf Borkers

188
Other disclosures
In line with section 160 (1) no. 8 AktG, we give notice that the following investments and changes to voting rights have
been registered to our Company in conformity with the duty of disclosure in accordance with section 21 of the Wert-
papierhandelsgesetz (WpHG – German Securities Trading Act):
Shareholder
Share-
holding
report as at Event
New voting
rights
share in %
of which
own hold-
ings in %
of which
indirectly
attributa-
ble in %
Benjamin Otto, Hamburg 02.04.2002 Exceeds threshold (5%) 7.74 0.00 7.74
"Bravo-Alpha" Beteiligungs- G.m.b.H.,
Hamburg 02.04.2002 Exceeds threshold (5%) 7.74 3.71 4.03
Gemeinnützige Hertie-Stiftung, Frankfurt 15.08.2011 Exceeds threshold (3%) 3.02 3.02 0.00
Alexander Otto, Hamburg 14.11.2012
Falls below threshold
(10%) 9.57 0.65 8.92
Société Fédérale de Participations et
d'Investissement SA / Federale Participatie-
en Investeringsmaatschappij NV, Brussels,
Belgium 11.01.2013 Exceeds threshold (3%) 3.08 0.00 3.08
Ministry of Finance of the Kingdom of Belgium,
Brussels, Belgium 11.01.2013 Exceeds threshold (3%) 3.08 0.00 3.08
Société Fédérale de Participations et
d'Investissement SA/Federale Participatie-
en Investeringsmaatschappij NV, Brussels,
Belgium 08.04.2013 Falls below threshold (3%) 2.93 0.00 2.93
Ministry of Finance of the Kingdom of Belgium,
Brussels, Belgium 08.04.2013 Falls below threshold (3%) 2.93 0.00 2.93
BlackRock Advisors Holdings, Inc., New York,
USA 30.10.2013 Exceeds threshold (3%) 3.0003 0.00 3.0003
BlackRock International Holdings, Inc., New
York, New York, USA 30.10.2013 Exceeds threshold (3%) 3.0003 0.00 3.0003
BR Jersey International Holdings, L.P.,
St. Helier, Jersey, Channel Islands 30.10.2013 Exceeds threshold (3%) 3,0003 0,00 3,0003
BlackRock Group Limited, London,
United Kingdom 14.11.2013 Exceeds threshold (3%) 3.01 0.00 3.01
United Kingdom 18.11.2013 Falls below threshold (3%) 2.96 0.00 2.96
United Kingdom 12.12.2013 Falls below threshold (3%) 2.999 0.00 2.999
The total fees for the consolidated financial statements for the 2013 financial year amounted to €310 thousand.
€293 thousand (previous year: €328 thousand) was for auditor services. The auditor also provided other consultancy
services in the amount of €17 thousand.

189
Shareholdings
LIST OF SHAREHOLDINGS IN ACCORDANCE WITH SECTION 313 (2) NOS. 1 TO 4 OF THE
HANDELSGESETZBUCH (HGB – GERMAN COMMERCIAL CODE) AS AT 31.12.2013:
Company name and domicile Interest in equity of which indirect of which direct
Equity as at
31.12.2013
HGB profit/loss
2013
Fully consolidated companies: in EUR in EUR
DES Verwaltung GmbH, Hamburg 100.00% – 100.00% 29,240,672.13 2,900,264.83
DES Management GmbH, Hamburg 100.00% – 100.00% 52,951.03 27,951.03
DES Shoppingcenter GmbH&Co. KG, Hamburg 100.00% – 100.00% 417,424,414.29 16,067,052.71
A10 Center Wildau GmbH, Hamburg 100.00% 100.00% 86,023,371.98 3,277,515.98
Objekt City-Point Kassel GmbH&Co. KG, Pullach 100.00% 100.00% – -24,024,805.44 2,747,557.39
Stadt-Galerie Hameln KG, Hamburg 100.00% – 100.00% 24,450,503.65 2,349,882.21
Altmarkt-Galerie Dresden GmbH&Co. KG, Hamburg 100.00% – 100.00% 40,562,836.19 3,345,348.38
Einkaufs-Center Galeria Baltycka G.m.b.H.&Co.KG,
Hamburg 74.00% – 74.00% 40,562,027.75 5,020,995.50
Forum Wetzlar KG, Hamburg 65.00% – 65.00% 9,888,976.60 2,670,443.33
Main-Taunus-Zentrum KG, Hamburg 52.01% 52.01% -91,320,990.02 18,122,394.95
in PLN in PLN
Einkaufs-Center Galeria Baltycka G.m.b.H.&Co. KG,
Sp. kom., Warsaw, Poland 99.99% 99.99% – 564,636,737.01 46,922,149.44
CASPIA Investments Sp. z o.o., Warsaw, Poland 100.00% 100.00% – 19,878,432.49 760,043.64
Joint ventures: in EUR in EUR
Stadt-Galerie Passau KG, Hamburg 75.00% – 75.00% 112,787,455.07 4,734,039.77
Allee-Center Magdeburg KG, Hamburg 50.00% – 50.00% 72,445,194.45 10,429,633.87
Immobilien Kommanditgesellschaft FEZ Harburg,
Hamburg 50.00% – 50.00% -19,998,292.26 2,237,215.97
CAK City Arkaden Klagenfurt KG, Hamburg 50.00% – 50.00% 4,748,040.81 1,375,792.60
EKZ Eins Errichtungs- und Betriebs Ges.m.b.H.&Co OG,
Vienna, Austria 50.00% 50.00% – -4,646,295.48 1,413,563.79
Einkaufs-Center Arkaden Pécs KG, Hamburg 50.00% – 50.00% 22,737,326.55 1,646,903.18
Associates: in EUR in EUR
Kommanditgesellschaft Sechzehnte ALBA
Grundstücksgesellschaft mbH&Co., Hamburg 50.00% 50.00% 1,832,141.19 -52,639.12
EKZ Vier Errichtungs- und Betriebs Ges.m.b.H.,
Vienna, Austria 50.00% 50.00% 795,702.87 32,592.35
Kommanditgesellschaft PANTA Fünfundsiebzigste
Grundstücksgesellschaft m.b.H.&Co., Hamburg 50.00% 50.00% 2,243,204.28 87,408.91
Kommanditgesellschaft PANTA Dreiunddreißigste
Grundstücksgesellschaft m.b.H.&Co., Hamburg 50.00% 50.00% 2,793,654.54 349,746.72
City-Point Beteiligungs GmbH, Pullach 40.00% – 40.00% 27,974.94 2,410.34
Investees: in EUR in EUR
Ilwro Holding B.V., Amsterdam, The Netherlands 33.00% 33.00% 103,555,930.00 15,169,948.00

190
Auditor’s report
We have audited the consolidated financial statements – comprising the balance sheet, statement of comprehensive
income, income statement, statement of changes in equity, cash flow statement and the notes – and the group manage-
ment report prepared by Deutsche EuroShop AG, Hamburg, for the financial year from 1 January 2013 to 31 December
2013. The preparation of the consolidated -financial statements and the group management report in accordance with
IFRS as adopted by the EU and the supplementary provisions of German commercial law required to be applied under
section 315a(1) of the Handelsgesetzbuch (HGB – German Commercial Code) is the responsibility of the Company’s
management. Our responsibility is to express an opinion on the consolidated financial statements and the group man-
agement report based on our audit.
We conducted our audit of the consolidated financial statements in accordance with section 317 of the HGB and Ger-
man generally accepted standards for the auditing of financial statements promulga-ted by the Institut der Wirtschafts-
prüfer (IDW). Those standards require that we plan and perform the audit such that misstatements materially
affecting the presentation of the net assets, financial positi-on and results of operations in the consolidated financial
statements in accordance with the applicab-le financial reporting standards and in the group management report are
detected with reasonable assurance. Knowledge of the business activities and the economic and legal environment of
the Group and expectations as to possible misstatements are taken into account in the determination of audit proce-
dures. The effectiveness of the accounting-related internal control system and the evidence supporting the disclosures
in the consolidated financial statements and the group management report are examined primarily on the basis of
spot checks within the framework of the audit. The audit includes assessing the accounting information of the areas
of the company included in the consolidated financial statements, the determination of the companies to be included
in the consolidated financial statements, the accounting and consolidation principles used, and significant estimates
made by management, as well as evaluating the overall presentation of the consolidated financial statements and the
group management report. We believe that our audit provides a reasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, based on the findings of our audit, the consolidated financial statements comply with IFRS as adopted
by the EU and the supplementary provisions of German commercial law required to be applied under section 315a(1)
of the HGB and give a true and fair view of the net assets, financial position and results of operations of the Group in
accordance with these requirements. The group ma-nagement report is consistent with the consolidated financial
statements, as a whole provides a sui-table understanding of the Group’s position and suitably presents the opportu-
nities and risks of future development.
BDO AG
Wirtschaftsprüfungsgesellschaft
signed Dyckerhoff signed Dr. Probst
Auditor Auditor

191
Responsibility statement
by the Executive board
We declare that to the best of our knowledge, in line with the accounting policies to be applied, the consolidated financial
statements present a true and fair view of the net assets, financial position and results of operations of the Group and
the Group Management Report presents the situation of the Group and the course of business including business per-
formance which is a fair and accurate view, and describes the essential opportunities and risks of the likely develop-
ment of the Group.
Claus-Matthias Böge Olaf Borkers

DAX. Germany’s premier equity in-
dex. The composition of the DAX is
established by Deutsche Börse AG
on the basis of the share prices of the 30 lar-
gest German companies listed in the Prime
Standard in terms of market capitalisation
and market turnover.
DISCOUNTED-CASHFLOW-MODELL (DCF).
Method for the assessment of companies
which is used to determine the future pay-
ments surplusses and discount them to the
valuation date.
DIVIDEND. The share of the distributed net
profit of a company to which a shareholder
is entitled in line with the number of shares
he or she holds.
EBIT. Earnings before interest and taxes.
EBT. Earnings before Taxes.
E-COMMERCE. Direct commercial relation-
ship between supplier and buyer via the inter-
net including the provision of services.
EPRA. European Public Real Estate
Association. Based in Brussels, the
EPRA is an organisation that rep-
resents the interests of the major European
property management companies and sup-
ports the development and market presence
of European public property companies. The
wellknown international index named after it,
the EPRA index, tracks the performance of the
largest European and North American listed
property companies.
EPS. Earnings per Share.
FAIR VALUE. According to IFRS, a
potential market price under ideal
market conditions for which an as-
set value may be traded or an obligation be-
tween competent and independent business
partners, willing to make a contract, may be
settled.
ADVERSTISING VALUE EQUIVA-
LENCE. Index number for the as-
sessment of the monetary value of
an editorial article. It is based on the adver-
tising rate of the medium.
ANNUAL FINANCIAL STATEMENT. Under
German (HGB) accounting principles, the an-
nual financial statements consist of a com-
pany’s balance sheet, profit and loss ac-
count, the notes to the financial statements
and the management report. The annual fi-
nancial statements of a public company are
prepared by its executive board, audited by
a certified public accountant (in Germany:
Wirtschaftsprüfer) and adopted by the super-
visory board.
BENCHMARK. A standard of com-
parison, e.g. an index which serves
as a guideline.
CASH FLOW PER SHARE (CFPS).
The cash flow per share is calculat-
ed by dividing the cash flow by the
number of shares issued by a company. The
cash flow per share is taken as the basis for
calculating the price/cash flow ratio.
CLASS OF ASSETS. Division of the capital
and real estate market into different classes
of assets or asset segments.
CONSUMER PRICE INDEX. Also called the
cost-of-living index, this is calculated in Ger-
many by the Federal Statistical Office on a
monthly basis. The CPI is the most important
statistical indicator of a change in prices; the
price of a basket of goods during a given pe-
riod is compared with the price of the same
basket during the base year. This change is
also known as the inflation rate.
CORE. Designation of a real estate invest-
ment and/or individual properties as well
as the name of an investment style. The term
refers to the relationship between risk and
return. Core designates mature, transpar-
ent, sufficiently large markets or high-qual-
ity, well-situated properties that are fully let
on a long-term basis to tenants with strong
credit ratings. Other return/risk categories
are value-added and opportunistic.
CORPORATE GOVERNANCE. The rules for
good, value-driven corporate management.
The objective is to control the company’s
management and to create mechanisms to
oblige executives to act in the interests of
their shareholders.
COVENANTS. A clause in a loan agreement
which pertains to and contractually defines
the binding warranties to be adhered to by the
borrower during the term of a loan.
COVERAGE. Information provided on a list-
ed public company by banks and financial
analysts in the form of studies and research
reports.
GlossarY
A
B
C
D
E
F
DEUTSCHEEUROSHOPANNUALREPORT2013/SERVICE
192

PERFORMANCE. The term performance de-
scribes the percentage appreciation of an in-
vestment or a securities portfolio during a
given period.
REIT. REIT stands for “Real Estate
Investment Trust”. REITs are listed
real estate corporations that are
exempt from tax at the company level. To
qualify, a minimum of 75% of their income
must come from real estate rental, leasing
and sales and 90% of profits must be distrib-
uted to shareholders as dividends.
RETAIL SPACE. Space in a building and/or
an open area that is used for sales by a re-
tail operation and that is accessible to cus-
tomers. Service areas required for opera-
tional and legal purposes are not taken into
account, nor are stairways or shop windows.
The retail space is part of the leasable space
of a business.
ROADSHOW. Corporate presentations to
institutional in vestors.
SAVINGS RATIO. Share of savings
of the income available in house-
holds.
SUBPRIME. Mortgage loan to borrower with a
low degree of creditworthiness.
TECDAX. The successor to the
NEMAX 50, comprising the 30 larg-
est German listed technology secu-
rities in terms of market capitalisation and
market turnover.
VOLATILITY. Statistical measure
for price fluctuations. The greater
the fluctuations in the price of a se-
curity, the higher its volatility.
XETRA. An electronic stock ex-
change trading system that, in con-
trast to floor trading, uses and open
order book, thus increasing market transpar-
ency. The trading hours are currently 9,00 a.m.
to 5,30 p.m.
FERI-RATING. Short for FERI real estate rat-
ing. A science-based system for the determi-
nation of an achievable sustained market
value (criteria: predicted net earnings, tak-
ing into account the location’s and property’s
attractiveness) and property rating (risk/
return ratio).
FOOD COURT. Catering area of a shopping
center, in which different vendors sell food
at stations about a common seating area.
FREE CASH FLOW. The surplus cash gener-
ated from operating activities recognised in
the profit and loss account. This expresses
a company’s internal financing power, which
can be used for investments, the repayment
of debt, dividend payments and to meet fund-
ing requirements.
FUNDS FROM OPERATIONS (FFO). Cash
flows from operating activities. DES-calcula-
tion: net income for the period adjusted for
measurement gains/losses and deferred in-
come tax expense.
GEARING. Ratio which shows the
relationship between liabilities and
equity.
HEDGE ACCOUNTING. Financial
mapping of two or more financial
instruments that hedge one another.
IFO BUSINESS CLIMATE INDEX.
The ifo Business Climate Index is
an important forward indicator for
economic development in Germany. In order
to calculate the index, the ifo Institute asks
approximately 7.000 companies every month
for their assessment of the economic situati-
on and their short-term corporate planning.
INTEREST RATE SWAP. Exchange of fixed
and variable interest pay able on two nomi-
nal amounts of capital for a fixed period. By
means of an interest rate swap, interest rate
risks may be controlled actively.
INTERNATIONAL FINANCIAL REPORTING
STANDARDS (IFRS). International Financi-
al Reporting Standards are based on Inter-
national Accounting Standards (IASs). Since
1 January 2005, listed companies have been
required to apply IFRSs. IASs/IFRSs focus on
the decision-usefulness of accounts. The key
requirement with regard to the annual finan-
cial statements is fair presentation that is not
qualified by aspects of prudence or risk pro-
vision.
LOAN TO VALUE. Ratio that ex-
presses the amount of a mortgage
as a percentage of the market value
of real property.
MALL. Row of shops in a shopping
center.
MARKET CAPITALISATION. The current
quoted price for a share multiplied by the
number of shares listed on the stock.
MDAX. German mid-cap index comprising
the 50 most important securities after the
DAX members. exchange. Market capitalisa-
tion is calculated for individual companies,
sectors, and entire stock markets, thus ena-
bling comparisons between them.
MULTI CHANNELLING. Using a combination
of online and offline communication tools in
marketing.
NET ASSET VALUE (NAV). Wert
des Vermögens abzüglich der
Verbindlichkeiten. Bezogen auf eine
Aktie stellt der NAV deren inneren Wert dar.
Zieht man vom NAV die latenten Steuern ab,
erhält man den Net Net Asset Value (NNAV).
PEER-GROUP. A share price per-
formance benchmark consisting
of companies from similar sectors,
put together on the basis of individual criteria.
G
H
I
L
M
N
P
R
S
T
V
X
193

194
09.–10.01. Oddo Midcap Forum, Lyon
15.01. J.P. Morgan European Real Estate CEO
Conference, London
22.01. Kepler Cheuvreux European Corporate
Conference, Frankfurt
20.03. PRELIMINARY RESULTS FY 2013
24.03. Roadshow Paris, Kepler Cheuvreux
24.03. Roadshow Zurich, Berenberg Bank
25.03. Roadshow Brussels, DZ Bank
26.03. Roadshow Munich, Baader Bank
27.03. Bank of America Merrill Lynch Real
Estate Conference, London
03.04. HSBC Real Estate Conference, Frankfurt
09.04. Roadshow Hamburg, Montega
15.04. Audit Commitee meeting, Hamburg
23.04. Supervisory Board meeting, Hamburg
25.04. PUBLICATION OF THE ANNUAL
REPORT 2013
14.05. INTERIM REPORT Q1 2014
15.05. Donner&Reuschel Hamburger
Investmentkonferenz, Hamburg
20.05. Roadshow London, M.M. Warburg
05.06. Kempen&Co. European Property
Seminar, Amsterdam
11.–13.06. db Access Conference, Berlin
18.06. ANNUAL GENERAL MEETING,
HAMBURG
12.08. INTERIM REPORT H1 2014
11.09. ESN European Conference, Frankfurt
17.09. Roadshow Luxemburg, Bankhaus Lampe
22.09. Berenberg Bank and Goldman Sachs
German Corporate Conference, Munich
23.09. Baader Bank Investment Conference,
Munich
30.09. Roadshow London, Berenberg Bank
01.10. Societe Generale Real Estate Conference,
London
06.10. ExpoREAL, Munich
13.11. NINE-MONTH REPORT 2014
17.11. Roadshow Paris, Deutsche Bank
18.11. Roadshow Amsterdam, Kempen&Co.
19.11. Roadshow Zurich, Baader Bank
27.11. Roadshow Dusseldorf/Cologne, DZ Bank
01.12.–02.12. Berenberg European Conference, Pennyhill
Our financial calendar is updated continuously.
Please check our website for
the latest events
www.deutsche-euroshop.com/ ir

195
A
Accounting 115, 148
Auditor’s report 190
Assets 127, 138, 149 et seq., 157,
160, 162 et seq.
B
Balance sheet 138, 145, 149 et seq.,
162 et seq.
C
Carrying amount 178
Cash flow 126, 142, 175 et seq., 180
Cash flow statement 142
Center management 6, 57, 113
Committees 15, 113 et seq.
Consolidated income statement 140,
151 et seq.
Corporate governance 16, 112 et seq.,
136,186
Currency translation 147
D
Declaration of conformity 116
Deferred taxes 161, 168
Dividend 10 et seq., 96, 102, 112,
118, 130, 166
Dividend proposal 124
E
Equity 125 et seq., 143, 166
Equity ratio 125, 181
Executive Board 14 et seq., 113 et seq.,
119, 185
F
Fair value 154, 158 et seq., 178 er seq.
FFO 2, 124, 129
Financial instruments 156, 159 et seq., 178
Financial position 121, 125 et seq.
Financing 112, 125
G
Gross domestic product (GDP)119, 128, 131
I
Income from investments 173
Investments 118, 126 et seq., 175
Investment properties 127, 138, 142,
158 et seq.
Investor relations 96 et seq.
K
Key data 2, 98
L
Liabilities 161, 166 et seq.
Liquidity 126
M
Marketing 108 et seq.
N
Net asset value 128, 146
Non-current assets 127, 138,
149 et seq., 164
Notes 144
P
Portfolio 10 et seq., 52 et seq., 118
Provisions 161, 169
R
Real estate market 120
Receivables 138, 142, 160, 164 et seq.
Remuneration 116, 124 et seq.
Reserves 139, 149 et seq., 166
Results of operation 121
Retail mix 58
Retail sector 54 et seq., 120, 131
Revenue 120 et seq., 129, 171
Right to redeem 139, 149 et seq., 160
Risks 130 et seq., 180 et seq.
S
Segment reporting 176
Share 10 et seq., 96 et seq., 120 et seq., 124
Shareholder structure 101
Shareholdings 189
Shopping centers 6, 8 et seq., 29 et seq.,
52 et seq., 118, 129
Strategy 112, 118, 130
Sustainability 63
T
Tenants 53 et seq.
U
Unappropriated surplus 166
W
Website 100, 109
IndexO O

196
AUTHORED ARTICLES
Bylined texts do not necessarily represent the views of Deutsche EuroShop AG.
The respective authors are responsible for the content of their own texts.
TRADEMARKS
All trademarks and product names referred to in this Annual Report are the property
of their respective owners. This applies in particular to DAX, MDAX, SDAX, TecDAX
and Xetra, which are registered trademarks and the property of Deutsche Börse AG.
ROUNDING AND RATES OF CHANGE
Percentages and figures stated in this report may be subject to rounding differences.
The rates of change are based on economic considerations: improvements are indi-
cated by a plus (+), deterioration by a minus (-).
FORWARD-LOOKING STATEMENTS
This Annual Report contains forward-looking statements based on estimates
of future developments by the Executive Board. The statements and forecasts
represent estimates made on the basis of all available information at the
present time. If the assumptions on which the state-
ments and forecasts are based do not materialise,
actual results may differ from those currently expected.
PUBLICATIONS FOR OUR SHAREHOLDERS
• Annual Report (German and English)
• Interim Reports Q1, H1 and 9M (German and
English)
ONLINE ANNUAL REPORT
Deutsche EuroShop’s Annual Report is available online
at www.deutsche-euroshop.com in PDF format and as an
interactive online version.
This annual report is also available in German. In the
event of conflicts the German-language version shall
prevail.
Imprint
PUBLISHED BY
Heegbarg 36
22391 Hamburg
Tel.: +49 (0)40 - 41 35 79 0
Fax: +49 (0)40 - 41 35 79 29
www.deutsche-euroshop.com
ir@deutsche-euroshop.com
EDITOR IN CHIEF
Patrick Kiss
EDITORIAL MANAGEMENT
Nicolas Lissner
GUEST EDITORS
Manfred Becht, Gerd Bovensiepen,
Rolf Bürkl , Raimund Ellrott,
Manuel Jahn, Dirk Riedel,
Dr. Stephanie Rumpff,
Rahel Willhardt
CONCEPT
ART DIRECTION
Whitepark GmbH&Co.
LAYOUT
Whitepark GmbH&Co.
ILLUSTRATION
Sarah Knorr
PICTURES
Deutsche EuroShop,
Douglas, ECE, Uwe Hüttner,
Christian Schmid,
istockphoto.com
DIGITAL PREPRESS
Albert Bauer Companies, Hamburg
RESPONSIBLE FOR THE EDITORIAL CONTENT
Deutsche EuroShop AG, Hamburg
ENGLISH TRANSLATION
CLS Communication AG
DISCLAIMER

197
Multi-year overview
2004 2005 2006 2007 2008 2009 2010 2011 20121
20131
Revenue 61.4 72.1 92.9 95.8 115.3 127.6 144.2 190.0 178.2 188.0
EBIT 49.8 57.5 86.3 78.5 98.1 110.7 124.0 165.7 151.6 165.8
Net finance costs -19.2 -39.3 -41.0 -39.6 -49.4 -55.9 -60.2 -79.1 -62.1 -34.1
Measurement gains/losses 8.0 40.0 68.8 39.0 38.3 -14.8 33.1 50.1 13.9 56.0
EBT 38.6 68.1 117.7 77.8 87.0 40.1 97.0 136.7 103.4 187.6
Consolidated profit 27.7 48.7 100.3 94.2 68.9 34.4 -7.8 99.0 122.5 171.0
FFO per share (€) 0.86 0.97 1.08 1.12 1.38 1.40 1.35 1.61 1.68 2.08
Earnings per share (€)2
0.89 1.55 2.92 2.74 1.96 0.88 -0.17 1.92 2.36 3.17
Equity3
684.4 787.4 897.9 974.0 977.8 1,044.4 1,441.5 1,473.1 1,606.1 1,642.4
Liabilities 685.8 756.1 898.3 1,002.3 1,029.1 1,067.8 1,522.1 1,752.0 1,741.5 1,752.5
Total assets 1,370.2 1,543.6 1,796.2 1,976.3 2,006.8 2,112.1 2,963.6 3,225.1 3,347.6 3,394.9
Equity ratio (%)3
49.9 51.0 50.0 49.3 48.7 49.5 48.6 45.7 48.0 48.4
Gearing (%)3
100 96 100 103 105 102 106 119 108 107
Cash and cash equivalents 150.3 197.2 94.2 109.0 41.7 81.9 65.8 64.4 161.0 40.8
Net asset value4
686.8 794.5 877.4 925.1 942.8 1,006.9 1,361.1 1,427.3 1,538.9 1,650.4
Net asset value per share
(€, EPRA)4
21.98 23.11 25.53 26.91 27.43 26.63 26.36 27.64 28.53 30.59
Dividend per share (€) 0.96 1.00 1.05 1.05 1.05 1.05 1.10 1.10 1.20 1.255
1
equity accounting
2
undiluted
3
incl. non controlling interest
4
since 2010: EPRA
5
proposal
€ MILLIONS
Q1/
2013
Q2/
2013
Q3/
2013
Q4/
2013
Revenue 42.4 46.4 49.3 49.9
EBIT 37.3 39.9 43.3 45.3
Net finance costs -10.1 -12.5 2.5 -14.0
Measurement gains/losses -1.4 -1.1 -4.3 62.8
EBT 25.8 26.4 41.5 93.9
Consolidated profit 20.1 21.7 35.4 93.8
EPS in €2
0.37 0.40 0.66 1.74
2013 IN € MILLIONS

Deutsche EuroShop | Annual Report 2013

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Deutsche EuroShop | Annual Report 2013