Kungsleden — update on tax rulings and downgraded estimate

In April 2012, listed Swedish property company Kungsleden received rulings from
the Administrative Court of Appeal in Stockholm regarding the fiscal year 2005.
These rulings relate to two companies in the Kungsleden group, which claimed tax
relief for losses on the liquidation of partnerships. These losses on
liquidation arose as a part of internal restructuring, and against this
background, the Administrative Court of Appeal shared the Administrative Court’s
view that the losses were not actual from a group perspective. The
Administrative Court of Appeal’s rulings imply a negative liquidity effect of
SEK 80 m, which will affect profit for calculating dividends for the fourth
quarter. The tax cost for the year will increase by SEK 260 m, which as an
effect of the rulings, will also be charged to the first quarter. These amounts
include interest and potential tax surcharges. . The profit effect is SEK 263 m.
Kungsleden intends to appeal against these rulings at the Supreme Administrative
Court.

If the outcome of all remaining tax proceedings is negative, the
company judges that consolidated equity would decrease by approximately SEK
1,400 m, against the previously reported SEK 1,660 m.

In terms of management,
the year started positively, the company has also succeeded in doing good
transactions.

The overall effect of the circumstances reviewed above is that
the Board of Directors’ estimate of Kungsleden’s profit for calculating
dividends for the full year 2012 will reduce by SEK 50 m to SEK 550 m from the
previously reported SEK 600 m.

“The outcome of both these rulings is
unexpected and it’s very surprising that the Administrative Court of Appeal has
chosen not to provide any explanation. The fact that it takes so long to obtain
a ruling is also a problem; the transactions in question were conducted back in
the financial year 2004. In the past year, different administrative courts of
appeal have issued several rulings that Kungsleden is not party to, but which
are on the same legal issue, and the outcomes have differed. Accordingly, we
intend to have this matter considered at the highest level,” commented Thomas
Erséus, Kungsleden’s Chief Executive.
For more information, please contact:

Thomas Erséus, CEO Kungsleden | phone
+46 (0)8 503 052 04 | mobile +46 (0)70 378 20 24
Johan Risberg, Deputy CEO
Kungsleden | phone +46 (0)8 503 052 06 | mobile +46 (0)70 690 65
65

www.kungsleden.se
Detta pressmeddelande finns tillgängligt på svenska på
www.kungsleden.se/pressmeddelanden 

Kungsleden AB (publ) discloses the
information in this press release according to the Swedish Securities Markets
Act and/or the Swedish Financial Trading Act. The information was provided for
public release on 12 April at 9:30 a.m.

Kungsleden’s strategy is to ensure
sustainable high and stable returns proceeding from its existing holding, and
through acquisitions and divestments. As of 31 December 2011, the property
portfolio comprised 636 properties with a book value of SEK 26.1 bn. The
portfolio was located in a total of 143 municipalities, mainly in southern and
central Sweden. Kungsleden has been quoted on the Nasdaq OMX Stockholm since
1999.