DGAP-News: DEMIRE Deutsche Mittelstand Real Estate AG / Key word(s): Half Year Results DEMIRE reports positive development in key figures 06.09.2016 / 21:15 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- DEMIRE reports positive development in key figures - Rental income rises to EUR 37.5 million (previous year: EUR 13.8 million) - Basic EPRA NAV per share rises to EUR 5.38 (Dec. 31, 2015: EUR 5.20) - Average interest rate falls to 4.4 % - Net financial debt now lower at 64 % - Fine-tuning of 2016 full year forecast - 2017 forecast: FFO of roughly EUR 18 million / EUR 0.34 per share Frankfurt/Main, September 6, 2016 - DEMIRE Deutsche Mittelstand Real Estate AG (ISIN: DE000A0XFSF0) today published its 2016 half-year financial report. In the first half of 2016, DEMIRE generated rental income of EUR 37.5 million, which was almost triple the prior year's figure of EUR 13.8 million and 100 % of the pro rata forecast for the full year of 2016. By mid-2016, the occupancy rate for the entire portfolio reached 87.8 % of the potential rents at full occupancy and surpassed the rate of 87.2 % at the end of the prior year. The occupancy rate of the existing portfolio as of June 30, 2016, was 89.3 % of the potential rents under the pro forma inclusion of concluded lease contracts for vacant space to be handed over to tenants after the reporting date. As a result of measurement effects and special items, IFRS earnings before interest and taxes (EBIT) in the first half of 2016 doubled to EUR 32.9 million compared to the previous year's level of EUR 16.1 million. At the same time, the profit/loss for the period in the first half of 2016 increased sharply to EUR 7.2 million after a level of EUR 0.3 million in the prior year's comparable period. Net profit/loss for the period adjusted for measurement effects, non- recurring and special items (EPRA earnings/FFO) before non-controlling interests amounted to EUR 5.3 million in the first half of 2016 and EUR 3.4 million after interests attributable to minority shareholders or EUR 0.07 per share outstanding as of the reporting date. Total assets increased slightly to EUR 1.07 billion as at June 30, 2016 (December 31, 2015: EUR 1.03 billion). Net debt (LTV) declined further to 66.1 % (December 31, 2015: 67.5 %) on real estate holdings amounting to roughly EUR 982 million. Basic/diluted EPRA NAV per share increased in the first half of 2016 to EUR 5.39/4.37 (December 31, 2015: EUR 5.20/4.25). Various refinancings concluded in the current fiscal year brought down the DEMIRE Group's average interest rate on financial liabilities to 4.4 % p.a. compared to 5.1 % p.a. at the end of the prior year. The recent repayment of the HFS bond through low-interest loans and equity alone will generate interest savings of roughly EUR 4.8 million on an annual basis. As a result, the loan-to-value ratio dropped from around 66 % of real estate assets on the reporting date to today's level of 64 %. Nevertheless, the reductions in administrative costs and interest expenses that will gradually begin to take effect in second half of 2016, will not be sufficient enough to fully compensate for the higher maintenance and rental costs that occurred in the first half-year. This has prompted the Executive Board to fine-tune its FFO forecast for full year 2016. Instead of the planned FFO before minority interests of just under EUR 20 million, the Executive Board now expects FFO before minority interests for the full year to amount to EUR 19.1 million and EUR 13.9 million after minority interests. With respect to the higher number of shares outstanding (weighted approximately 50.9 million shares) following the cash capital increase, the new FFO target is EUR 0.27 per share. The Executive Board also confirms its target of an occupancy rate of 90 % by the end of 2016. For the 2017 fiscal year, assuming there are no changes to the total portfolio, the Executive Board expects rental income to total EUR 77 million and FFO before minority interests of around EUR 25 million and roughly EUR 18 million after minority interests. This amount corresponds to about EUR 0.34 per currently outstanding share. CEO Andreas Steyer in his comments to the forecasts said: "This new forecast for the coming 2017 fiscal year illustrates the potential that could be realised through the measures already implemented. We are confident that we can improve our core portfolio even further and continue to strive for the value-creating expansion of our portfolio and the consistent optimisation of our financial and balance sheet structures". The 2016 half-year financial report is available on the Company website at www.demire.ag under the Investor Relations section: (http://www.demire.ag/ en/investor-relations/reports-results/2016). Highlights of the DEMIRE Group's Key Financial Figures (EURk)

Consolidated income         01/01/2016 -30/06/2016           01/01/2015 -
statement                                                      30/06/2015
Rental income                               37,529                 13,839
Profit/loss from the                        29,800                 11,210
rental of real estate
EBIT                                        32,850                 16,068
Financial result 1)                        -22,849                -14,289
EBT                                         10,001                  1,779
Net profit/loss for the                      7,186                    297
period
Net profit/loss for the                0.11 / 0.09            -0.01/-0.01
period per share (basic/
diluted) in EUR
FFO before/after minority              5.278/3,363                    n/a
interests
FFO after minority                       0.07/0.05                    n/a
interests per share
(basic/diluted)

Consolidated balance sheet              30/06/2016             31/12/2015
Total assets                             1,066,766              1,032,945
Investment properties                      981,466                915,089
Non-current assets held                        825                 13,005
for sale
Total core portfolio                       982,291                928,094

Financial liabilities                      677,962                655,239
Cash and cash equivalents                   29,015                 28,467
Net financial debt                         648,947                626,772
in % of core portfolio                        66.1                   67.5
(LTV)

Equity in consolidated                     273,673                264,902
balance sheet
Equity ratio in %                             25.7                   25.6

Basic/diluted EPRA NAV           264,324 / 275,405      256,267 / 271,585
Number of shares                     49.31 / 62.95          49.29 / 63.95
outstanding in million
(basic/diluted)
Basic/diluted EPRA NAV in              5.38 / 4.37            5.20 / 4.25
EUR per share

1) In 2016, including the interests of minority shareholders in subsidiaries of Fair Value REIT-AG amounting to EURk 1,816. Contact information DEMIRE Deutsche Mittelstand Real Estate AG Lyoner Straße 32 60528 Frankfurt am Main Phone: +49 (0) 69-719 189 79 0 Fax: +49 (0) 69-719 189 79 11 Email: [email protected] Web: www.demire.ag Investor Relations GFEI Aktiengesellschaft Lars Kuhnke Phone: +49 (0) 511 47 40 23 10 Email: [email protected] _______________________________________ About DEMIRE - First in secondary locations DEMIRE Deutsche Mittelstand Real Estate AG has commercial real estate holdings in mid-sized cities and up and coming areas bordering German metropolitan areas. As at June 30, 2016, DEMIRE held real estate consisting of 178 properties with a market value of EUR 982 million. As at the reporting date, contractual rents had been firmly agreed upon in the amount of EUR 74.2 million (at an occupancy rate of 87.8 % of the potential rents of EUR 84.5 million) for a term of 5.4 years. DEMIRE aims to maintain its corporate organisation as lean as possible, although it still believes that economies of scale and portfolio optimisation are best achieved by having its own in-house asset, property and facility management. This safeguards the Company's business expertise and, equally important, allows the Company to maintain direct contact with the customer. DEMIRE Deutsche Mittelstand Real Estate AG shares (ISIN: DE000A0XFSF0) are listed in the Prime Standard segment of the Deutsche Börse in Frankfurt. --------------------------------------------------------------------------- 06.09.2016 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de --------------------------------------------------------------------------- Language: English Company: DEMIRE Deutsche Mittelstand Real Estate AG Lyoner Straße 32 60528 Frankfurt am Main Germany Phone: +49 (0)69 / 719 189 79 0 Fax: +49 (0)69 / 719 189 79 11 E-mail: [email protected] Internet: www.demire.ag ISIN: DE000A0XFSF0 WKN: A0XFSF Listed: Regulated Market in Berlin, Frankfurt (Prime Standard); Regulated Unofficial Market in Dusseldorf, Stuttgart, Tradegate Exchange End of News DGAP News Service --------------------------------------------------------------------------- 499533 06.09.2016