FINANCIAL STATEMENTS Consolidated financial statements as of December 31, 2017 3 6.3 Non-recovered rental expenses 6.7 Change in value of investment properties These expenses are stated net of charges re-invoiced to tenants and In €m 12/31/2017 12/31/2016 mainly comprise expenses on vacant premises. Change in value of investment properties at fair value 836.3 843.8 6.4 Owners’ building expenses Change in value of investment properties at cost -10.4 -15.0 These expenses are composed of owners’ rental expenses, expenses TOTAL 825.9 828.8 related to construction work, legal costs, expenses on bad debts and costs related to real estate management. 6.8 Income from disposals of investment 6.5 Other operating revenue properties and equity investments Income from disposals totaled €6.8 million and mainly resulted from Other operating revenue includes: the disposal of: > building works re-invoiced to tenants; > the shares of the shopping center Lillestrøm Torv in Norway and > other income. the company holding the offices of the Emporia shopping mall in Sweden; 6.6 Depreciation and impairment allowance > the two shopping centers Puerta de Alicante and Augusta in Spain; on tangible and intangible assets > a newly constructed hotel shell located in Utrecht in the Netherlands; As of December 31, 2017, the depreciation and impairment allowance > the shares of company holding a land in Bulgaria; on tangible and intangible assets amounts to €15.2 million, an increase of €0.4 million compared to December 31, 2016. > 16 retail units, a warehouse in Clamart and three shopping centers: Courbevoie Charras, Vigie Strasbourg and Val Saint Clair Herouville in France. Income from disposals also includes transfer costs and related expenses. 6.9 Net cost of debt The net cost of debt amounts to €169.8 million, compared to €197.7 million at December 31, 2016. The decrease in net cost of debt comes from debt restructuring (new bonds refinancing, swaps unwinding and repayment that was implemented in 2017). In €m 12/31/2017 12/31/2016 Financial income 80.8 109.0 Income from sale of securities -0.0 0.1 Interest income on swaps 41.2 57.9 Deferral of payments on swaps 0.8 0.3 Capitalized interest 9.2 9.2 Interest on associates’ advances 11.1 12.2 Sundry interest received 5.6 3.0 Other revenue and financial income 6.6 8.6 Currency translation gains 6.3 17.7 Financial expenses -250.6 -306.7 Expenses from sale of securities Interest on bonds -159.8 -179.4 Interest on loans from credit institutions -16.7 -23.3 Interest expense on swaps -29.1 -45.6 Deferral of payments on swaps -36.7 -29.5 Interest on associates’ advances -3.0 -1.9 Sundry interest paid -2.1 -1.6 (a) -37.7 -69.0 Other financial expenses Currency translation losses -5.1 -15.0 Transfer of financial expenses 5.2 5.1 (b) 34.3 53.6 Amortization of the fair value of debt NET COST OF DEBT -169.8 -197.7 (a) Including all cost related to earlier redemption of bond tendered (€12,6 million). (b) Corresponds to the amortization of the market value adjustment of Corio’s debt at the acquisition date. KLÉPIERRE 2017 REGISTRATION DOCUMENT 103