NRE NorthStar Realty Europe Corp

PROPOSAL SUBMITTED TO NRE STOCKHOLDERS

The Merger Proposal

In the merger proposal, NRE stockholders are being asked to consider and vote on the merger — the merger of NRE with and into Merger Sub, with Merger Sub as the Surviving Entity, which merger will result in NRE no longer existing as a legal entity, and the Surviving Entity no longer being a publicly-traded company and being a wholly-owned subsidiary of Parent. The merger and related transactions contemplated by the merger agreement cannot be completed without the approval of the merger proposal by the affirmative vote of NRE stockholders entitled to cast a majority of all the votes entitled to be cast on the matter. Failing to vote your shares in favor of the merger proposal, abstentions and broker non-votes, if any, will have the same effect as a vote “AGAINST” the merger proposal. Because the only matter being considered at the special meeting is the merger proposal, which is a “non-routine” matter, we do not anticipate any broker non-votes at the special meeting.

The NRE board, following the unanimous recommendation of the SRC, unanimously recommends that NRE stockholders vote “FOR” the merger proposal.

26

INFORMATION ABOUT THE SPECIAL MEETING

Date, Time and Place of the Special Meeting

This proxy statement is being furnished to NRE stockholders as part of the solicitation of proxies by the NRE board for use at the special meeting to be held on [—], 2019, at [—] a.m., Eastern Time, at 535 Madison Avenue, 7th Floor, New York, NY 10022, or at any postponement or adjournment thereof.

Purpose of the Special Meeting

The sole purpose of the special meeting is for holders of NRE common stock to consider and vote on the merger proposal. Pursuant to Maryland law and NRE’s bylaws, no other matters may be brought before the special meeting.

Recommendation of the SRC and the NRE Board

The SRC has unanimously adopted resolutions recommending, among other things, that the NRE board: (i) declare advisable and in the best interests of NRE the adoption of the merger agreement and, on the terms and subject to the conditions set forth in the merger agreement, the merger and the other transactions contemplated by the merger agreement; (ii) approve and authorize the execution, delivery and performance of the merger agreement and all related agreements and documents, on the terms and subject to the conditions set forth in the merger agreement and all related agreements and documents, including the letter agreement between DB AG London, and the Partnership setting forth the terms and conditions of a transaction pursuant to which the Partnership would agree to purchase U.S. dollars in exchange for Euros and pounds sterling at a future trade date for the purpose of hedging the portion of the aggregate merger consideration denominated in Euros and pounds sterling subject to the ISDA Master Agreement, dated as of October 6, 2017, as amended and supplemented in accordance with its terms from time to time between the Partnership and DB AG London; and (iii) direct that the merger be submitted for consideration at the special meeting, with the recommendation that NRE stockholders vote to approve the same.

The NRE board, following the unanimous recommendation of the SRC, has unanimously: (i) declared advisable and in the best interests of NRE the adoption of the merger agreement and, on the terms and subject to the conditions set forth in the merger agreement, the merger and the other the transactions contemplated by the merger agreement; (ii) approved and authorized the execution, delivery and performance of the merger agreement and all related agreements and documents, on the terms and subject to the conditions set forth in the merger agreement and all related agreements and documents, including the letter agreement between DB AG London and the Partnership setting forth the terms and conditions of a transaction pursuant to which the Partnership would agree to purchase U.S. dollars in exchange for Euros and pounds sterling at a future trade date for the purpose of hedging the portion of the aggregate merger consideration denominated in Euros and pounds sterling subject to the ISDA Master Agreement, dated as of October 6, 2017, as amended and supplemented in accordance with its terms from time to time between the Partnership and DB AG London; and (iii) directed that the merger be submitted for consideration at the special meeting, with the recommendation that NRE stockholders vote to approve the same.

Accordingly, the NRE board, following the unanimous recommendation of the SRC, unanimously recommends that you vote “FOR” the merger proposal.

NRE stockholders entitled to cast a majority of all the votes entitled to be cast on the merger proposal must vote at the special meeting to approve the merger proposal in order for the merger to occur. A copy of the merger agreement is attached as Annex A to this proxy statement, which we encourage you to read carefully and in its entirety.

Record Date; Stockholders Entitled to Vote

NRE has fixed the close of business on [—], 2019 as the record date for the special meeting, and only holders of record of NRE common stock on the record date are entitled to receive notice of, and to vote at (in

27

person or by proxy), the special meeting. You will be entitled to one vote on the merger proposal for each share of NRE common stock that you owned at the close of business on the record date. As of the close of business on the record date, there were [—] shares of NRE common stock outstanding and entitled to vote, held by [—] holders of record.

Stockholders of Record and Beneficial Owners

If your shares of NRE common stock are registered directly in your name with NRE’s transfer agent, AST, you are considered, with respect to those shares of NRE common stock, the “stockholder of record”. This proxy statement and proxy card have been sent directly to you by NRE.

If your shares of NRE common stock are held through a bank, broker or other nominee, you are considered the “beneficial owner” of shares of NRE common stock held in “street name”. In that case, this proxy statement has been forwarded to you by your bank, broker or other nominee who is considered, with respect to those shares of NRE common stock, the stockholder of record. As the beneficial owner of shares of NRE common stock, you have the right to direct your bank, broker or other nominee how to vote your shares by following their instructions for voting. Banks, brokers or other nominees who hold shares in “street name” for customers generally have the authority to vote on “routine” proposals when they have not received instructions from beneficial owners. However, banks, brokers and other nominees are precluded from exercising their voting discretion with respect to approving “non-routine” matters such as the merger proposal, and as a result, absent specific instructions from the beneficial owner of shares of NRE common stock, banks, brokers or other nominees are not empowered to vote those shares of NRE common stock on “non-routine” matters. A broker non-vote occurs when a nominee holds shares for a beneficial owner cannot vote on a proposal because it is a “non-routine” matter and the nominee has not received instructions from the beneficial owner. Because the only matter being considered at the special meeting is the merger proposal, which is a “non-routine” matter, we do not anticipate any broker non-votes at the special meeting.

Quorum

The presence in person or by proxy at the special meeting of holders of NRE common stock entitled to cast a majority of all the votes entitled to be cast at the special meeting will constitute a quorum for purposes of the special meeting. All shares of NRE common stock, represented in person or by proxy, including abstentions and broker non-votes, if any, will be treated as present for purposes of determining the presence or absence of a quorum at the special meeting.

Under NRE’s bylaws, if a quorum is not present or represented at the special meeting, the chairperson of the special meeting has the power to adjourn the special meeting from time to time until a quorum is present or represented without any vote of the stockholders.

Attendance

Only NRE stockholders of record, their duly authorized proxy holders, beneficial stockholders with proof of ownership and NRE’s guests may attend the special meeting. A government-issued picture identification will be required to enter the special meeting. NRE stockholders may obtain directions to the special meeting by writing to NorthStar Realty Europe Corp., Attention: General Counsel and Secretary, 590 Madison Avenue, 34th Floor, New York, New York 10022. If you are a stockholder of record, please indicate that in your request. If you are the representative of a corporate or institutional stockholder, you must present valid photo identification along with proof that you are the representative of such stockholder. If your shares of NRE common stock are held through a bank, broker or other nominee, you must enclose with your request evidence of your ownership of shares, which you can obtain from your bank, broker or other nominee. Please note that cameras, recording devices and other electronic devices will not be permitted at the special meeting.

28

Vote Required; Effect of Failure to Vote, Abstentions and Broker Non-Votes

Approval of the merger proposal requires the affirmative vote of NRE stockholders entitled to cast a majority of all the votes entitled to be cast on the matter. For the merger proposal, you may vote “FOR” , “AGAINST” or “ABSTAIN” . Abstentions and broker non-votes, if any, will not be counted as votes cast in favor of the merger proposal, but will count for the purpose of determining whether a quorum is present. A failure to authorize a proxy or to vote in person at the special meeting, an abstention or a broker non-vote, if any, will have the same effect as a vote “AGAINST” the merger proposal. Because the only matter being considered at the special meeting is the merger proposal, which is a “non-routine” matter, we do not anticipate any broker non-votes at the special meeting.

How to Vote Your Shares

If you are a stockholder of record, you may vote your shares of NRE common stock at the special meeting in any of the following ways:

Proxies authorized by the Internet or telephone must be received by 11:59 p.m., Eastern Time, on [—]. If you choose to authorize a proxy by mailing a proxy card, your proxy card should be mailed in the accompanying prepaid reply envelope, and your proxy card must be filed with NRE’s General Counsel and Secretary by the time the special meeting begins. If your shares are held in the name of a bank, broker or other nominee, follow the instructions you receive from your bank, broker or other nominee on how to vote your shares.

If you vote by proxy, regardless of the method you choose to vote, the individuals named on the enclosed proxy card, and each of them, with full power of substitution, will vote your shares of NRE common stock in the way that you indicate.

If you properly sign your proxy card but do not mark the box showing how your shares of NRE common stock should be voted on the merger proposal, the shares of NRE common stock represented by your properly signed proxy will be voted “ FOR ” the merger proposal.

If you have any questions or need assistance voting your shares, please contact D.F. King & Co., Inc., NRE’s proxy solicitor, by calling toll-free at (800) 487-4870.

IT IS IMPORTANT THAT YOU VOTE YOUR SHARES OF NRE COMMON STOCK PROMPTLY. WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING PREPAID REPLY ENVELOPE, OR AUTHORIZE A PROXY BY THE INTERNET OR TELEPHONE. STOCKHOLDERS WHO ATTEND THE SPECIAL MEETING MAY REVOKE THEIR PROXIES BY VOTING IN PERSON. ATTENDANCE ALONE WITHOUT VOTING WILL NOT BE SUFFICIENT TO REVOKE A PREVIOUSLY AUTHORIZED PROXY.

29

Revocation of Proxies

Any stockholder of record has the right to revoke a proxy, whether authorized over the Internet, by telephone or by mail, at any time before it is exercised, by voting again at a later date through any of the methods available to you, by giving written notice of revocation to NRE’s General Counsel and Secretary, which must be filed with the General Counsel and Secretary by the time the special meeting begins, or by attending the special meeting and voting in person. Your attendance at the special meeting will not by itself revoke your proxy. Written notice of revocation should be mailed to: NorthStar Realty Europe Corp., Attention: General Counsel and Secretary, 590 Madison Avenue, 34 ^th Floor, New York, New York 10022.

If you hold shares in street name, you should contact your bank, broker, or other nominee for instructions on how to change your vote.

Adjournments

The special meeting may adjourn to reconvene at the same or some other place. Under NRE’s bylaws, notice of any adjourned meeting need not be given if the time and place of such adjourned meeting are announced at the special meeting at which the adjournment is taken. At the adjourned meeting, any business may be transacted that might have been transacted at the original meeting. If the special meeting is adjourned to a date more than 120 days after the record date originally fixed for the special meeting, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting must be given to each stockholder of record entitled to vote at the special meeting.

Tabulation of the Votes

NRE will appoint AST to serve as the inspector of elections for the special meeting to tabulate affirmative and negative votes and abstentions.

Solicitation of Proxies; Payment of Solicitation Expenses

Directors and officers of NRE may solicit proxies on behalf of NRE in person or by telephone, facsimile or other means, for which they will not receive any additional compensation. NRE has engaged D.F. King & Co., Inc. to assist in the solicitation of proxies for the special meeting. NRE has agreed to pay D.F. King & Co., Inc. approximately $12,500, plus out of pocket expenses, for its services to solicit proxies. In accordance with the regulations of the SEC and the NYSE, NRE will also reimburse banks, brokers and other custodians, nominees and fiduciaries for their expenses incurred in sending proxies and proxy materials to beneficial owners of shares of NRE common stock.

Questions and Additional Information

If you have more questions about the mergers or how to authorize your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please contact D.F. King & Co., Inc., NRE’s proxy solicitor, by calling toll-free at (800) 487-4870.

30

THE MERGERS

This discussion of the mergers is qualified in its entirety by reference to the merger agreement, which is attached as Annex A to this proxy statement. You should read the entire merger agreement carefully and in its entirety as it is the legal document that governs the mergers.

The merger agreement provides that if the merger proposal is approved by NRE stockholders and the other closing conditions under the merger agreement have been satisfied or waived, NRE will merge with and into Merger Sub, with Merger Sub as the Surviving Entity. Immediately prior to and in connection with the merger, Partnership Merger Sub will merge with and into the Partnership, with the Partnership as the Surviving Partnership.

Following the consummation of the mergers, NRE will no longer exist as a legal entity. The Surviving Entity will not be a publicly-traded company and will become a wholly-owned subsidiary of Parent. If the mergers are completed, you will not own any shares of the capital stock of the Surviving Entity.

Merger Consideration

If the merger is completed, pursuant to the terms of the merger agreement (a copy of which is attached as Annex A to this proxy statement), each issued and outstanding share of NRE common stock (other than cancelled shares) will be converted automatically into the right to receive the per share consideration, without interest. As described more fully below and in the merger agreement, the non-U.S. dollar denominated portion of the per share consideration will be converted into U.S. dollars at closing and NRE stockholders will receive only U.S. dollars in connection with the merger.

In connection with the execution of the merger agreement, NRE entered into six-month forward foreign exchange contracts to hedge against changes in the U.S. dollar-Euro and U.S. dollar-pound sterling exchange rates in respect of the merger consideration. Assuming the closing date occurs prior to the end of the settlement period under the forward contracts on January 6, 2020, the forward contracts will be settled and the portion of the merger consideration denominated in Euros and pounds sterling will be converted into U.S. dollars upon the closing, with the actual U.S. dollar per share consideration payable to NRE stockholders reflecting the final exchange rates in effect on that date (which may be at rates greater or lesser than the currently estimated exchange rates, depending on the closing date). Assuming a closing on [—], 2019, two business days after the date of the special meeting, NRE estimates that the per share consideration in U.S. dollars would be equal to approximately $[—] per share. Any settlement of the forward contracts prior to the end of their stated duration, that is, prior to January 6, 2020, may reduce the U.S. dollars per share received by NRE stockholders due to a shorter duration of the hedge. The settlement amount would be determined by the movement in the forward points from the closing date to January 6, 2020. There may also be an adjustment to discount the hedge settlement amount to its present value as of the closing date if the closing occurs before January 6, 2020. The settlement of the forward contracts is not contingent upon the consummation of the mergers. Therefore, even if the mergers are not completed, the hedges pursuant to the forward contracts will remain in place and NRE will be required to settle the forward contracts at maturity of the hedges, which may result in a loss or a gain to NRE.

Background of the Mergers

NRE is an externally managed, European-focused commercial real estate company with predominantly prime office properties in key cities within Germany, the United Kingdom and France. NRE commenced operations as a separate publicly-traded company on November 1, 2015, following the spin-off.

In accordance with the terms of the management agreement then in effect between NorthStar Realty and an affiliate of NorthStar Asset Management Group Inc., which we refer to as NSAM, the then parent of the external manager of NorthStar Realty, in connection with the spin-off NRE entered into an asset management agreement

31

with an affiliate of NSAM, which, as amended from time to time in accordance with its terms, we refer to as the NRE management agreement. The NRE management agreement provided for an initial 20-year term from October 31, 2015, with automatic renewals for additional 20-year terms on each anniversary thereafter unless earlier terminated. The NRE management agreement could not be terminated in connection with a change of control of NRE or otherwise during its initial term, during any renewal term or at the end of any term, other than for cause (as defined in the NRE management agreement). In addition, the NRE management agreement provided for a minimum annual base management fee with no downward adjustment for a decline in NRE’s capital base.

Since the spin-off, the NRE board has regularly evaluated NRE’s business and operations, trends in the real estate industry, and the macro-economic environment, all with a view toward creating and maximizing stockholder value. From time to time, this evaluation has included the review of potential business combinations, spin-offs, acquisitions, dispositions, changes in corporate structure, the renegotiation of the NRE management agreement, share repurchases and other strategic alternatives.

On June 2, 2016, NSAM and NorthStar Realty entered into a merger agreement with Colony, providing for the combination of NSAM, NorthStar Realty and Colony, which we refer to as the Colony transaction. Following the announcement and continuing through the closing of the Colony transaction, the NRE board and a special committee of the NRE board solely comprised of Mario Chisholm and Dianne Hurley analyzed the impact of the Colony transaction on NRE and the NRE management agreement and engaged in discussions with Colony. During this period, Colony communicated to the NRE board its willingness to discuss changes to the NRE management agreement following the closing of the Colony transaction.

On July 22, 2016, Bow Street, LLC, which we refer to as Bow Street, sent a letter to the NRE board. In its letter, Bow Street stated that it was the holder of approximately 4.9% of NRE common stock, and that Bow Street was prepared to acquire NRE at more than a 30% premium to its then current trading value. On that date, the closing price of NRE common stock on the NYSE was $9.22 per share, implying a per share value for Bow Street’s proposal in excess of $11.98. Bow Street stated that its offer was predicated on the negotiation of definitive acquisition documents, tax and other confirmatory diligence, and reaching a separate commercial agreement with NSAM.

On August 10, 2016, Bow Street sent a further letter to the NRE board. In its letter, Bow Street reiterated its interest in an acquisition of NRE and its desire to engage with the NRE board and NSAM to pursue a transaction. On that date, the closing price of NRE common stock on the NYSE was $9.17 per share.

On December 9, 2016, Bow Street, which at that time was the holder of approximately 6.7% of NRE common stock, filed a Schedule 13D with the SEC, containing a letter sent to the Chairman of the NRE board on the same date proposing to acquire the remaining equity interest in NRE for approximately $680 million, or $13.00 per share. On that date, the closing price of NRE common stock on the NYSE was $12.35 per share.

On January 10, 2017, the Colony transaction closed. As a result of the Colony transaction, the entity surviving as the external manager of NRE became a subsidiary of Colony NorthStar, Inc., the parent of the merged companies in the Colony transaction (which subsequently changed its name to Colony Capital, Inc., which we refer to as Colony) and the existing NRE management agreement remained in effect.

On February 2, 2017, the NRE board engaged Venable LLP, which we refer to as Venable, to assist the NRE board in determining which directors would constitute disinterested directors in connection with consideration of the proposals from Bow Street, communications NRE had received from other stockholders, and potential changes to the NRE management agreement with the external manager of NRE. Representatives of Venable had discussions with each of the independent directors of NRE regarding relationships that could impact their status as disinterested directors with respect to such matters.

32

At a meeting of the NRE board on February 13, 2017, a representative of Venable presented to the NRE board regarding Venable’s findings as to the disinterestedness of the independent directors of NRE with respect to strategic alternatives, including a potential transaction with Bow Street or the negotiation of potential changes to the NRE management agreement. Following this presentation and discussion by the NRE board, at an executive session of the independent directors of NRE, consisting of Mario Chisholm, Judith A. Hannaway (NRE’s lead independent director), Dianne Hurley, Oscar Junquera and Wesley D. Minami, the independent directors determined that each of the independent directors was disinterested with respect to the NRE board’s consideration of the foregoing strategic alternatives.

On March 23, 2017, the NRE board established the SRC, consisting of Mr. Chisholm, Ms. Hannaway, Ms. Hurley, Mr. Junquera and Mr. Minami. The SRC was vested with the exclusive power and authority, to the fullest extent permitted by law and the bylaws of NRE, among other things, to analyze, study, review, evaluate, negotiate and approve: changes to or termination of the NRE management agreement; any strategic alternatives available to NRE; and any request by Colony for a waiver of the beneficial ownership and constructive ownership limitations in NRE’s charter (which Colony had previously indicated that it may seek). The SRC was authorized to engage its own legal counsel, financial advisor and such other agents and experts as the SRC deemed necessary or advisable.

Subsequently, the SRC engaged Fried Frank Harris Shriver & Jacobson LLP, which we refer to as Fried Frank, as its legal counsel. The SRC also engaged a financial advisor.

The SRC met on April 13, 2017, with representatives of Fried Frank and the SRC’s financial advisor in attendance. At that meeting, the SRC and its advisors discussed the NRE management agreement and potential changes that could enhance NRE’s stock market valuation.

At a meeting of the SRC on April 18, 2017, which was attended by representatives of Fried Frank and the SRC’s financial advisor, Richard B. Saltzman, the then Chief Executive Officer of Colony, and David T. Hamamoto, the then Executive Vice Chairman of Colony, a representative of Colony advised the SRC that Colony was considering a potential purchase of the shares of NRE common stock held by Bow Street and another NRE stockholder at a premium to the current market price. The representative of Colony noted that these transactions would result in Colony owning approximately 14% of the outstanding shares of NRE common stock and would require a waiver of the provisions of NRE’s charter restricting ownership by any stockholder in excess of 9.8% (in value or in number of shares, whichever is more restrictive) of the outstanding shares of NRE common stock.

The SRC met again on April 20, 2017, with representatives of Fried Frank and the SRC’s financial advisor and representatives of Colony in attendance. At that meeting, the SRC determined that an investment by Colony, the parent company of the external manager of NRE, in shares of NRE common stock would further align Colony’s interests with those of NRE stockholders. The SRC also discussed the possibility of granting Colony a waiver of the ownership restrictions in NRE’s charter to permit Colony to purchase additional shares of NRE common stock through purchases from Bow Street and the other stockholder and open market purchases, if in the future Colony proposed to acquire shares of NRE common stock in excess of the ownership restrictions in NRE’s charter. The SRC also discussed the possibility of imposing limitations on the voting power of shares of NRE common stock purchased and held by Colony.

On May 12, 2017, Bow Street and a subsidiary of Colony entered into a stock purchase agreement, pursuant to which the Colony subsidiary purchased 3,723,934 shares of NRE common stock from Bow Street at a price per share of $12.75. On that date, the closing price of NRE common stock on the NYSE was $11.73 per share.

On May 16, 2017, the Colony subsidiary entered into a Rule 10b-18 purchase agreement with a brokerage firm, pursuant to which the Colony subsidiary appointed the brokerage firm as its non-exclusive agent to purchase shares of NRE common stock in the open market. On May 22, 2017, Colony filed a Schedule 13D with the SEC disclosing ownership of approximately 7.8% of the outstanding shares of NRE common stock.

33

Between May 2017 and November 2017, the SRC met on more than 20 occasions. Throughout this period, the SRC, with the assistance of its advisors, engaged in discussions and negotiations with Colony regarding potential amendments to the NRE management agreement.

On November 9, 2017, the SRC and Colony reached agreement on the terms of an amended and restated NRE management agreement. The amended and restated NRE management agreement, among other things, revised the term and termination provisions of the NRE management agreement to reflect an initial five-year term (compared to the 20-year term of the prior agreement) with the ability of the NRE board to decline to renew the agreement at the end of the initial five year term and each renewal term, or to terminate the agreement at any time after the initial term in connection with a change of control of NRE, subject to the payment of a termination fee. In addition, in order to align the interests of the external manager of NRE more closely with those of NRE stockholders, the fees payable under the NRE management agreement were modified to be more in line with market precedent, including by providing for the payment of an incentive fee in the event that NRE stockholders realized a total stockholder return, which we refer to as TSR, in excess of 10% on a cumulative basis and limiting the expenses that the external manager of NRE could charge to NRE. The amended and restated NRE management agreement also granted Colony the right to designate a nominee to the NRE board.

On November 9, 2017, NRE and Colony also executed an ownership waiver under NRE’s charter, allowing Colony to purchase up to 45% of the outstanding shares of NRE common stock. In connection with the waiver, Colony agreed that for all matters submitted to a vote of NRE stockholders, to the extent Colony owned more than 25% of the outstanding shares of NRE common stock, it would vote the excess shares in the same proportion as the votes of the remaining shares of NRE not owned by Colony or its affiliates. On that date, the closing price of NRE common stock on the NYSE was $14.01 per share.

Between November 9, 2017 and February 12, 2018, the trading price of NRE common stock declined from the closing price on the NYSE on November 9, 2017 of $14.01 to $10.64 per share on February 12, 2018.

At a meeting of the SRC on February 12, 2018, the SRC discussed NRE’s then current stock price as well as recent feedback from NRE stockholders.

On February 16, 2018, the SRC met again, with representatives of Fried Frank in attendance. At that meeting, the SRC interviewed Goldman Sachs and two other investment banking firms with a view to potentially engaging a new financial advisor to assist the SRC in reviewing strategic alternatives in light of NRE’s recent stock price performance.

On March 12, 2018, the NRE board authorized the repurchase of up to $100 million of outstanding shares of NRE common stock. During the period from March 12, 2018 to December 31, 2018, NRE repurchased a total of 6.1 million shares of NRE common stock for approximately $83.4 million at a weighted average price of $13.73 per share.

At a meeting of the SRC on March 20, 2018, the SRC determined to engage a new financial advisor to assist the SRC. While Colony was engaged in discussions at that time with potential financial advisors to assist in reviewing strategic alternatives for NRE, the SRC believed it was appropriate for the SRC to engage its own financial advisor.

The SRC met again on March 21, 2018 with representatives of Fried Frank and Sullivan & Cromwell LLP, which we refer to as Sullivan & Cromwell, counsel to NRE, in attendance, and discussed further the potential engagement of a financial advisor to the SRC. During the meeting, the SRC determined to engage Goldman Sachs as its financial advisor due to its substantial experience with transactions involving real estate companies.

On March 25, 2018, the SRC entered into an engagement letter, effective as of March 19, 2018, with Goldman Sachs under which the SRC engaged Goldman Sachs as its financial advisor to, among other things,

34

assist the SRC in preparing for potential acquisition proposals and the execution of a potential strategic transaction, including a potential internalization of the management of NRE, a restructuring of the NRE management agreement, a merger, the possible sale of all or a portion of the stock or assets of NRE, or a potential third-party investment in NRE.

The NRE board met on April 17, 2018, with members of NRE management in attendance. At that meeting, the NRE board engaged in a discussion with respect to the potential listing of NRE common stock on a European securities exchange. The NRE board did not reach any conclusion with respect to a European listing at that meeting.

On April 18, 2018, the SRC met, with representatives of Fried Frank and Goldman Sachs in attendance. At that meeting, representatives of Goldman Sachs provided an overview of the European real estate market, recent merger and acquisition activity in Europe, and the current challenges faced by NRE.

On April 27, 2018, the SRC met again, with representatives of Fried Frank and Goldman Sachs in attendance. At that meeting, representatives of Goldman Sachs discussed a possible process for exploring strategic alternatives for NRE. A discussion also took place regarding a possible European listing for NRE common stock, and representatives of Goldman Sachs discussed possible concerns with respect to such a listing, including potential liquidity issues and the complexity associated with a dual listing on the NYSE and a European securities exchange. After this discussion, the SRC directed Goldman Sachs to analyze certain additional alternatives, including reductions in costs under the NRE management agreement combined with a private investment in public securities of NRE, which we refer to as a PIPE investment, an internalization of the management of NRE combined with a PIPE investment, and reductions in general and administrative expenses of NRE.

Between April 2018 and December 2018, NRE was also pursuing the sale of various non-core assets. On May 3, 2018, NRE completed the sale of its Maastoren Tower property, located in the Netherlands, for $193 million.

At a meeting of the SRC on May 8, 2018, with representatives of Fried Frank and Goldman Sachs in attendance, the SRC discussed with its advisors the possibility of renegotiating the NRE management agreement, including the issuance of convertible preferred stock to fund a termination payment.

The SRC met again on May 15, 2018, with Mr. Saltzman, the chief legal officer of Colony, and members of NRE management, as well as representatives of Goldman Sachs, Fried Frank and Sullivan & Cromwell in attendance. At that meeting, representatives of Goldman Sachs discussed its preliminary review of strategic alternatives, including renegotiating the NRE management agreement, internalizing management, dual listing or re-listing on a European securities exchange, raising additional capital, repurchasing shares, selling assets, and merging or selling NRE. At that meeting, Mr. Saltzman indicated that Colony had held preliminary discussions with an externally-managed REIT, which we refer to as Party A, regarding a potential combination with NRE.

On May 30, 2018, Mahbod Nia, the Chief Executive Officer of NRE, met with a representative of Party A. The parties engaged in a preliminary discussion of a potential combination of NRE with Party A.

At a meeting of the SRC on June 1, 2018, with a representative of Fried Frank and Mr. Saltzman in attendance, the SRC discussed Mr. Nia’s meeting with Party A as well as a potential PIPE investment by a real estate investment firm, which we refer to as Party B. The SRC engaged in a discussion of strategic alternatives and agreed to follow up with Goldman Sachs on its analysis of strategic alternatives under review.

On June 12, 2018, a private equity sponsor sent a letter to NRE indicating its interest in pursuing the acquisition of a portfolio of assets from NRE. NRE did not respond to this indication of interest at that time, and the private equity sponsor subsequently declined to participate in NRE’s strategic review process.

35

On June 28, 2018, Ms. Hannaway met with Mr. Saltzman and representatives of Goldman Sachs. At that meeting, the parties discussed the potential transaction with Party A, the potential PIPE investment by Party B, an internalization of management of NRE and potential asset sales. At this meeting, Ms. Hannaway emphasized to Mr. Saltzman the need for a clear path forward for NRE. Ms. Hannaway briefed the other members of the SRC on the discussions of the June 28 meeting at a meeting of the SRC held the following day.

At a meeting on July 12, 2018, attended by members of the NRE management and representatives of Party B, Party B indicated potential interest in transactions with NRE beyond a PIPE investment.

At a meeting of the SRC on July 18, 2018, with members of NRE management and a representative of Fried Frank in attendance, the SRC discussed recent communications with stockholders and management of NRE briefed the SRC on the recent meeting with Party B. In addition, Ms. Hannaway reported to the SRC that the potential transaction with Party A was unlikely.

At a meeting of the SRC on August 2, 2018, with representatives of Fried Frank and Goldman Sachs in attendance, representatives of Goldman Sachs discussed with the SRC an overview of various scenarios for the termination of the NRE management agreement and the internalization of the management of NRE functions. The parties also discussed the current status of discussions with each of Party A and Party B, and Ms. Hannaway reported to the SRC that management believed these transactions were unlikely to progress.

On August 3, 2018, NRE held its annual meeting of stockholders. At that meeting, each of the director nominees, including each member of the SRC, was elected to serve until the next annual meeting of stockholders and until his or her successor is duly elected and qualified. Following the annual meeting, a meeting of the SRC was held. The SRC invited Mr. Saltzman, as a representative of Colony, and Mr. Nia to attend. At this meeting, the SRC proposed a termination of the NRE management agreement in exchange for a termination payment of $25-30 million. Mr. Saltzman indicated that Colony would consider a termination of the NRE management agreement in exchange for payment by NRE to the external manager of NRE of a $150 million termination payment and the repurchase by NRE of Colony’s shares of NRE common stock at NRE’s net asset value per share, or approximately $115 million in the aggregate.

Between August and November 2018, members of the SRC and its representatives engaged in ongoing discussions and negotiations with representatives of Colony regarding potential amendments to the NRE management agreement. Mr. Saltzman generally acted as the principal representative of Colony and the external manager of NRE in these discussions and negotiations. References in the following paragraphs regarding these discussions and negotiations to a “representative of Colony” include Mr. Saltzman and any other employees of Colony attending those meetings or involved in those discussions.

At a meeting of the SRC on August 17, 2018, with a representative of Fried Frank in attendance, the SRC discussed Colony’s views regarding a potential internalization of NRE management.

On September 18, 2018, at the direction of the SRC, representatives of Goldman Sachs met with a representative of Colony to discuss possible terms for a termination of the NRE management agreement. At this meeting, the representative of Colony presented Colony’s analysis of a potential internalization of management of NRE.

On September 18, 2018, at the direction of the SRC, representatives of Goldman Sachs met again with a representative of Colony. At this meeting, the representatives of Goldman Sachs discussed with the representative of Colony the SRC’s view that the path to maximize value for NRE should begin with a termination of the NRE management agreement, independent of any potential purchase of Colony’s shares of NRE common stock. The representative of Colony conveyed to Goldman Sachs Colony’s view that any termination of the NRE management agreement would need to be in exchange for a termination fee, and in connection with a sale of NRE.

At a meeting of the SRC on September 19, 2018, with representatives of Fried Frank and Goldman Sachs in attendance, the SRC discussed the Goldman Sachs meeting with the representative of Colony. Following a meeting of the NRE board on September 20, 2018, the SRC met again for a further discussion of the SRC’s strategy for negotiating with Colony.

36

On September 24, 2018, Senvest Management LLC, which we refer to as Senvest, the owner of approximately 9.6% of the outstanding shares of NRE common stock, sent to the NRE board a letter proposing, among other things, that NRE begin an orderly sale of assets, returning the net cash proceeds to NRE stockholders via stock buybacks or dividends, or pursue a sale of NRE to Colony. Senvest filed a Schedule 13D with the SEC on September 25, 2018, which included a copy of the aforementioned letter. On the same day, the SRC met, with representatives of Fried Frank and Goldman Sachs in attendance. The SRC discussed the letter from Senvest and three potential options for NRE: (i) a negotiated termination of the NRE management agreement and a simultaneous internalization of management and a possible repurchase of Colony’s shares of NRE common stock; (ii) a negotiated termination of the NRE management agreement and a simultaneous sale of NRE; and (iii) the sale of assets followed by a distribution of proceeds to NRE stockholders.

At an SRC meeting on September 26, 2018, with representatives of Fried Frank and Goldman Sachs in attendance, the SRC determined to request from Colony its best and final proposal for the termination of the NRE management agreement. The SRC met again for a further discussion on the following day, with representatives of Fried Frank and Goldman Sachs in attendance.

On September 28, 2018, the SRC met with a representative of Colony, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance. The SRC requested a proposal from Colony with respect to a termination of the NRE management agreement. The representative of Colony indicated that Colony would consider a termination of the NRE management agreement if the SRC was prepared to conduct a sale process for NRE. After the representative of Colony left the meeting, the SRC engaged in a further discussion with its advisors. Following this discussion, the SRC directed Goldman Sachs to convey to the representative of Colony that NRE would be prepared to pursue a sale process provided that Colony agreed to a termination of the NRE management agreement in exchange for payment of an agreed termination fee in connection with the completion of a change of control of NRE or in the event that the sale process did not result in a change of control and the SRC determined to internalize management of NRE.

Between October 1, 2018 and early November 2018, the SRC had more than 12 meetings to discuss potential amendments to the NRE management agreement and strategic alternatives for NRE, as well as feedback from stockholders. During this period, representatives of the SRC and Colony engaged in numerous discussions and negotiations regarding amendments to the NRE management agreement and potential strategic alternatives for NRE. The SRC considered the possibility of selling NRE’s portfolio of assets in individual transactions, but noted that individual assets sales would give rise to significant tax and other transaction costs and trigger additional management fee payments to the external manager of NRE.

At a meeting of the SRC on November 2, 2018, at which a representative of Colony was present, members of NRE management and representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell were in attendance, The representative of Colony provided to the SRC a summary of the terms on which Colony would be prepared to agree to termination of the NRE management agreement. These terms included an announcement for a sale process by NRE. The parties discussed the possibility of a payment of a $50 million termination fee to the external manager of NRE upon termination of the NRE management agreement, together with the payment of the incentive fee that would otherwise be payable to the external manager of NRE under the NRE management agreement upon termination, or a $75 million termination payment not conditioned on completion of a change of control transaction for NRE.

At a meeting of the NRE board held on the same day, the NRE board approved the sale of NRE’s Trianon Tower.

The SRC met again on November 4, 2018, with representatives of Fried Frank and Goldman Sachs in attendance. The SRC discussed strategic alternatives for NRE, potential termination payments to the external manager of NRE in connection with a termination of the NRE management agreement, and the sale of Trianon Tower.

37

On November 6, 2018, NRE executed a definitive sale and purchase agreement to sell Trianon Tower for €670 million. To preserve strategic and operational flexibility, the NRE board determined to retain the net proceeds from the sale of Trianon Tower rather than distributing the net proceeds to NRE stockholders.

On November 7, 2018, NRE and the external manager of NRE, a subsidiary of Colony, entered into an amendment to the NRE management agreement. The amendment provided for the automatic termination of the NRE management agreement on the earlier of (i) the closing of an NRE change of control (as defined in the NRE management agreement), and (ii) the completion of an internalization of the management of NRE within nine months of the later of (x) April 30, 2019, the triggering date if on such date NRE had not entered into a definitive agreement for an NRE change of control and (y) if on April 30, 2019 NRE has entered into a definitive agreement for an NRE change of control, the date on which such definitive agreement is terminated, if any, if no other definitive agreement for an NRE change of control has been entered into within 30 days thereafter. The amendment to the NRE management agreement also provided that, upon termination, NRE would be obligated to pay to the external manager of NRE a termination payment equal to (i) $70 million, minus (ii) the amount of any incentive fee previously paid to the external manager of NRE pursuant to the NRE management agreement.

Under the terms of the amendment to the NRE management agreement, NRE agreed to use commercially reasonable efforts, consistent with the duties of the members of the SRC and the NRE board, to enter into a definitive agreement providing for an NRE change of control. In addition, the parties agreed to (i) negotiate in good faith to execute a definitive transition services agreement, pursuant to which the external manager of NRE and its affiliates would provide, or cause to be provided, to NRE certain services on a transitional basis for up to nine months following the termination of the NRE management agreement, and (ii) formulate a management transition and retention program to induce certain employees of the external manager of NRE and its affiliates to continue providing certain services to NRE through the strategic review process and the termination of the NRE management agreement.

On the same date, NRE issued a press release announcing the amendment to the NRE management agreement, and that the SRC would conduct a process to review strategic alternatives in an effort to enhance stockholder value, including by means of a potential sale of NRE. On November 6, 2018, the last trading day prior to announcement of the execution of the amendment to the NRE management agreement and the initiation of the strategic review process, the closing price of NRE common stock on the NYSE was $14.63 per share.

A meeting of the SRC was held on November 12, 2018, with representatives of Fried Frank in attendance. During the meeting, representatives of Fried Frank reviewed with the members of the SRC their duties in connection with conducting a strategic review process.

A meeting of the SRC was held on November 15, 2018, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance. At this meeting, representatives of Goldman Sachs reviewed with the SRC process considerations, potential bidders for NRE, proposed marketing materials and a proposed timeline for the strategic review process. Additional meetings of the SRC to discuss the strategic review process, with representatives of Fried Frank and Goldman Sachs in attendance, took place on November 23, 2018 and November 30, 2018.

On December 5, 2018, the SRC met, with representatives of Fried Frank and Goldman Sachs in attendance. Representatives of Goldman Sachs reviewed with the SRC a list of potential bidders for NRE, which consisted of 106 strategic buyers, financial sponsors, asset managers, pension funds, sovereign wealth funds and family offices. After discussion, the SRC expressed approval of the list of potential bidders.

At a meeting of the SRC on December 12, 2018, which was attended by Mr. Saltzman, members of NRE management and representatives of Fried Frank and Goldman Sachs, representatives of Goldman Sachs provided an overview of the work to date related to the strategic review process and a market update, including an overview of the political uncertainty in the United Kingdom and the impact of Brexit on NRE’s portfolio of

38

properties. Representatives of Goldman Sachs presented a proposed timeline for the strategic review process, which the SRC approved. Keith Feldman, the Chief Financial Officer of NRE, presented the five-year property-by-property financial projections that had been prepared for use by potential bidders in connection with the strategic review process.

A meeting of the SRC was held on December 21, 2018, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs provided an update with respect to the potential bidders that showed interest in participating in the process and reviewed the timeline for the strategic review process.

In December 2018, NRE completed the sale of three United Kingdom assets in the Greater London area of Chiswick and St. Albans and in Glasgow, Scotland for aggregate consideration of $40 million. NRE also signed definitive agreements to sell three additional German assets, consisting of its Uhlandstrasse property in Frankfurt for $40 million, and two small non-core retail assets in Werl and Bremen for an aggregate consideration amount of $4 million.

At a meeting of the SRC held on January 4, 2019, which was attended by representatives of Fried Frank and Goldman Sachs, representatives of Goldman Sachs reviewed the work completed to date related to the strategic review process. The SRC also discussed the possibility of repurchasing shares of NRE common stock from Colony, but concluded it would not be appropriate to make any such purchase at that time.

In connection with the strategic review process, at the SRC’s direction, Goldman Sachs considered or was contacted by approximately 137 potential interested parties, including financial sponsors, asset managers, strategic buyers, pension funds and family offices. Approximately 54 of these 137 parties executed non-disclosure agreements and received non-public evaluation materials, data room access, and a first round process letter. The non-disclosure agreements included standstill provisions under which, after the announcement of a sale transaction by NRE, parties would be permitted to make confidential transaction proposals to the SRC without obtaining the SRC’s prior consent.

Beginning on January 15, 2019, the SRC and its advisors made information available through a virtual data room to potential interested parties who had signed non-disclosure agreements. Over the course of the strategic review process, at the direction of the SRC, management of NRE and Goldman Sachs provided periodic updates to participants in the strategic review process regarding NRE’s forecasted September 30, 2019 balance sheet (the forecasted balance sheet as of the quarter end closest to the anticipated completion date of a transaction). Over time, this balance sheet was adjusted downward by management of NRE to reflect changes in NRE’s cash forecast and other items. In addition, currency exchange rates fluctuated during this period, with the U.S. dollar strengthening against the Euro and the pound sterling. For example, the closing spot exchange rates on February 19, 2019 (the first round bid deadline) for the Euro and the pound sterling against the U.S. dollar were €1: $1.1342 and £1: $1.3058, respectively, and on July 3, 2019 (the date of announcement of the mergers), the closing spot exchange rates for the Euro and the pound sterling against the U.S. dollar were €1: $1.129 and £1: $1.2582, respectively. Due to changes in NRE’s forecasted September 30, 2019 balance sheet and exchange rates, the estimated U.S. dollar values of indications of interest or bids for NRE or its assets on any particular date discussed in this section of the proxy statement are not directly comparable to estimated values of indications of interest or bids submitted on other dates.

At meetings of the SRC held on January 17, 2019, January 24, 2019, February 7, 2019 and February 14, 2019, at which representatives of Fried Frank and Goldman Sachs were in attendance, representatives of Goldman Sachs updated the SRC as to the status of the strategic review process.

On January 21, 2019, at the direction of the SRC, Goldman Sachs distributed to potential interested parties who had signed non-disclosure agreements a process letter, calling for the submission of first round bids for NRE or its assets on February 19, 2019. On February 19, 2019, the closing price of NRE common stock on the NYSE was $17.36 per share.

39

In connection with the first round bid deadline, NRE received 18 non-binding indications of interest, consisting of 14 proposals from sponsors and asset managers, three from strategic buyers and one from a family office. Below is a summary of the terms of the indications of interest received, based on Goldman Sachs’ estimate of the implied per share value for NRE of each of the indications of interest:

At a meeting of the SRC held on February 22, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, the SRC and its advisors discussed the various indications of interest received in the first round of the strategic review process, including that the indications of interest did not take into account transaction costs and, since no party had performed detailed due diligence, any tax liabilities and other expenses that would arise in connection with a party’s acquisition of a publicly-traded U.S. REIT. Following these discussions, the SRC directed Goldman Sachs to hold follow up conversations with a number of these parties to clarify certain aspects of their proposals. Representatives of Goldman Sachs reached out to these parties beginning on February 22, 2019, after the conclusion of the SRC meeting.

At a meeting of the SRC held on February 25, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, representatives of Goldman Sachs updated the SRC on Goldman Sachs’s follow up discussions

40

with certain of the bidders, and noted that, following these discussions, the implied values of certain indications of interest had been revised:

In addition, in the course of discussions with representatives of Goldman Sachs, Party J also indicated limited flexibility on price and on valuation of NRE’s assets in the United Kingdom, and that its per share value was based on asset values and would likely be adjusted downward for corporate liabilities and transaction costs.

Following these discussions, the SRC determined to invite eight parties to participate in a second round bid process. The eight parties selected to move forward in the process were: Parent; Party C; Party D; Party E; Party F; Party G; Party H; and Party I. The SRC determined to include selected asset bidders to move forward in the process in view of the potential to maximize value by selling selected assets separately or by having bidders for these assets partner with other bidders.

Between February 26, 2019 and March 4, 2019, management of NRE conducted management meetings with representatives of each of Parent, Party C, Party D, Party E and Party F. Each of these parties also conducted tours of certain NRE properties.

On March 6, 2019, Party H withdrew from the process, citing various other projects it was working on.

At a meeting of the SRC on March 6, 2019, at which members of NRE management and representatives of Fried Frank and Goldman Sachs were in attendance, representatives of Goldman Sachs reviewed the status of the strategic review process, provided a summary of key components of an analysis of internalization alternatives for NRE, and reviewed potential process alternatives.

In the first fiscal quarter of 2019, NRE completed the sale of its Uhlandstrasse property in Frankfurt for approximately $40 million, and two small non-core retail assets in Werl and Bremen for an aggregate consideration amount of $4 million.

On March 7, 2019, Party E, an investment group, withdrew from the process, indicating that it perceived that an acquisition of NRE presented additional costs as compared to an acquisition of NRE’s real estate. Party E also indicated that its fund structure was not conducive to an acquisition of NRE and noted the complexity of splitting the assets of NRE among multiple investment funds.

The second U.K. Parliament Brexit vote occurred on March 12, 2019, resulting in the possibility of Great Britain leaving the European Union without an exit agreement. Since the March 12, 2019 vote, there has been continued uncertainty as to the terms and timing of the United Kingdom’s exit from the European Union.

At a meeting of the SRC held on March 14, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, the SRC and its advisors discussed the status of the strategic review process and the impact of Brexit on the process. Following this discussion, the SRC agreed to establish April 9, 2019 as the deadline for second round bids.

On March 19, 2019, at the direction of the SRC, representatives of Goldman Sachs distributed a round two process letter. The process letter directed the participating bidders to submit a best and final offer on April 9, 2019, accompanied by a markup of a draft merger agreement furnished by Fried Frank.

41

At a meeting of the SRC on March 21, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, representatives of Goldman Sachs reviewed the current status of the strategic review process and reviewed an illustrative analysis of potential future merger and acquisition opportunities for NRE in the event of an internalization of NRE management.

During the week of April 1, 2019, Party F communicated that it would not submit a second round proposal due to its inability to get comfortable with risks of an acquisition transaction, including risks related to Brexit.

On April 2, 2019, Party I submitted to the SRC a letter of intent to purchase certain of NRE’s German and French assets. This offer was for fewer of NRE’s German and French assets than its first round indication of interest, but on an asset-by-asset valuation was on substantially the same terms as its first round indication of interest. The value of the offer was approximately $354 million.

On April 4, 2019, the SRC met, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs updated the SRC on the status of the strategic review process and reviewed with the SRC NRE management’s forecasts for an internalization scenario. See the section entitled “—Certain NRE Forecasts” beginning on page [—] of this proxy statement.

On the same date, Party G withdrew from the process, citing a lack of funding for the transaction.

On April 9, 2019, the requested deadline for submission of second round offers, two parties submitted offers to acquire NRE:

On April 14, 2019, Parent submitted a revised offer to acquire NRE, with an estimated value of approximately $17.50 per share, citing, among other things, due diligence findings, including certain capital gains tax issues, German real estate transfer tax costs, and other costs associated with acquiring a public company. Parent’s offer was accompanied by a markup of the draft merger agreement which included various provisions that could affect certainty of closing, including, among other things, requirements that NRE have an unspecified minimum amount of available cash at closing, that all tax representations of NRE be true at closing without any materiality qualifier, that NRE complete the liquidation of various subsidiaries prior to closing, that certain German assets be sold to a separate Parent affiliate immediately prior to closing, and that NRE provide to Parent reliance letters from its environmental consultant relating to environmental reports provided to NRE. Parent indicated that its offer would be financed with an equity commitment from an affiliate of Parent and cash on hand of NRE.

The SRC met on April 15, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, to discuss the second round bids received by NRE and to discuss the potential internalization of management of NRE as an alternative to a sale of NRE. Representatives of Goldman Sachs noted that bidders had identified various structural and tax issues impacting valuation, including German real estate transfer taxes; the desire of certain parties to purchase REIT tax insurance; latent capital gains tax issues; and other potential tax liabilities and transaction costs. The SRC discussed with its advisors the possibility of Party I teaming with Party C or Party D to bid jointly on an acquisition of NRE, given that Party I’s values for certain assets exceeded the values

42

the SRC understood Party C and Party D attributed to those assets. A representative of Fried Frank reviewed with the members of the SRC their duties in connection with evaluating the proposals and considering a potential transaction and the provisions contained in Parent’s markup of the draft merger agreement that could affect certainty of closing. The SRC determined to continue the strategic review process and to continue to engage with each of Parent, Party C and Party D to clarify their proposals and to improve their respective terms, as well as to explore the possibility of introducing Party I to Party C and/or Party D. The SRC also requested that Goldman Sachs work with management of NRE to develop an illustrative plan for a sale of all assets and liquidation of NRE. To assist with the evaluation of this alternative, the SRC directed Goldman Sachs to request each of Parent, Party C and Party D to submit a proposal for an acquisition of substantially all of NRE’s assets by the end of April 2019.

During the first quarter of 2019 and early April 2019, the SRC also engaged in discussions and negotiations with Colony with respect to the transition agreements with the external manager of NRE and employees of the external manager of NRE contemplated by the amendment to the NRE management agreement executed on November 7, 2018. In order to keep those employees of the external manager of NRE aligned and engaged during the strategic review process, the parties agreed that such employees would be retained through the closing of a sale and would be entitled to receive severance payments in connection with the termination of their employment upon closing of a sale. In April 2019, the parties also began discussing a potential extension of the April 30, 2019 triggering date under the NRE management agreement to accommodate the ongoing strategic review process, in view of the fact that the strategic review process appeared likely to extend beyond April 30, 2019.

At a meeting of the SRC on April 18, 2019, with representatives of Fried Frank in attendance, the SRC determined to move forward to finalize an employee transition agreement, a transition agreement with the external manager of NRE and Colony, and a further amendment to the NRE management agreement to extend the triggering date under the NRE management agreement.

On the same date, Party F communicated to representatives of Goldman Sachs that Party F might be interested in re-engaging in the strategic review process with a co-investor.

At a meeting of the SRC on April 23, 2019, with representatives of Fried Frank and Goldman Sachs in attendance, representatives of Goldman Sachs provided an update on the status of strategic review process and reviewed with the SRC structural considerations relating to a potential sale of assets and liquidation, and information relating to a potential internalization alternative. On the same day, NRE entered into a further amendment to the NRE management agreement, which extended the April 30, 2019 triggering date to June 30, 2019 to accommodate the ongoing strategic review process, and entered into the employee transition and management transition agreements previously approved at the April 18, 2019 SRC meeting.

On April 25, 2019, representatives of Goldman Sachs spoke with the potential co-investor with Party F. On April 30, 2019, Party F communicated to representatives of Goldman Sachs that it was unable to proceed with an offer for all of NRE, but might consider an offer for its French assets.

In response to the SRC’s request for Parent, Party C and Party D to submit proposals to acquire substantially all of the assets of NRE, two parties submitted revised offers for NRE:

43

Party D did not submit a further proposal for an acquisition of substantially all assets of NRE, but on April 26, 2019, Party D submitted a proposal for an acquisition of NRE’s German assets for approximately $297 million. Party D’s proposal indicated it would be acting with a co-investor and requested a four-week exclusivity period. While Party D did not formally withdraw its interest in an acquisition of substantially all assets of NRE, it did not pursue such a transaction further after April 26, 2019.

At a meeting of the SRC on April 30, 2019, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance, the SRC discussed with its advisors the revised proposals received from Parent and Party C and other alternatives to maximize value, including an internalization of the management of NRE. Representatives of Goldman Sachs reviewed with the SRC issues relating to a potential sale of all assets and wind down of NRE, noting that management of NRE had estimated that such a scenario would likely involve significant costs. Following this discussion, the SRC directed representatives of Goldman Sachs to continue to engage with Parent and Party C with respect to an acquisition of NRE common stock and Fried Frank to prepare revised drafts of the merger agreement for each bidder.

On May 2, 2019, at the direction of the SRC, representatives of Goldman Sachs distributed to each of Parent and Party C a further bid process letter, calling for the submission of final bids for NRE by May 30, 2019. In addition, representatives of Goldman Sachs advised telephonically the remaining bidders for selected NRE assets, Party F and Party I, of the May 30, 2019 deadline.

On May 3, 2019, Parent conveyed to representatives of Goldman Sachs a request that NRE agree to reimburse Parent for up to $2 million of transaction expenses to induce Parent to continue working towards a transaction. Parent indicated that it would not continue working towards a transaction absent NRE’s willingness to reimburse its transaction expenses in the event that no transaction was entered into with Parent. The SRC discussed this request at meetings of the SRC on May 6, 2019, with representatives of Fried Frank and Goldman Sachs in attendance. Following discussion, in order to induce Parent to continue to participate in the strategic review process while the SRC continued to explore alternatives, the SRC directed Fried Frank to draft a proposed expense reimbursement letter. On May 7, 2019, Fried Frank furnished a draft expense reimbursement letter to DLA Piper LLP, counsel to Parent, which we refer to as DLA.

On May 8, 2019, Party F indicated to representatives of Goldman Sachs that it would not make an offer for NRE’s French assets.

On May 10, 2019, representatives of Goldman Sachs furnished to representatives of Deutsche Bank Securities Inc., which we refer to as DB, the financial advisor to Parent, a revised draft merger agreement prepared by Fried Frank.

On May 12, 2019, representatives of Goldman Sachs furnished to Party C a revised draft merger agreement prepared by Fried Frank.

Also on May 12, 2019, Party I advised representatives of Goldman Sachs that Party I would not be in a position to make a revised offer by May 30, 2019.

On May 13, 2019, at the direction of the SRC, representatives of Goldman Sachs provided an introduction of Party D to Party C, with a view to facilitating an improved offer by Party C. Based on information provided by Party C, the SRC understood that Party C subsequently engaged in discussions with Party D regarding certain of NRE’s assets, but these discussions did not result in Party D participating in Party C’s subsequent proposals.

44

On May 15, 2019, DLA sent to Fried Frank a revised draft of the expense reimbursement letter.

The SRC met on May 16, 2019, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs provided an update to the SRC on the status of discussions and reviewed potential next steps in the strategic review process.

Also on May 16, 2019, Fried Frank sent to DLA a further revised draft of the expense reimbursement letter and representatives of Goldman Sachs spoke by telephone with representatives of DB to discuss the status of Parent’s proposal and its response to the draft expense reimbursement letter. Representatives of Fried Frank and DLA spoke by telephone on May 17, 2019 regarding the draft expense reimbursement letter. The focus of these discussions was the conditions under which Parent would be entitled to reimbursement. Following this discussion, Fried Frank sent to DLA a further revised expense reimbursement letter. The revised letter, among other things, required as a condition to Parent’s right of reimbursement that Parent submit, prior to the bid deadline, a fully-financed, binding proposal at a price not less than $17.50 per share (subject to adjustment for material issues identified after the date of the letter) and containing limited conditions to closing.

On May 22, 2019, DLA sent to Fried Frank a revised draft expense reimbursement letter. The revised draft, among other things, required as a condition to Parent’s right of reimbursement that Parent submit, prior to the bid deadline, a fully-financed, binding proposal at a price not less than $16.75 per share (subject to adjustment for material issues identified after April 14, 2019) and containing conditions to closing not materially less favorable to NRE than those contained in Parent’s markup of the draft merger agreement of April 14, 2019.

Further discussions took place between representatives of Goldman Sachs and representatives of Parent between May 22 and May 27, 2019. On May 27, 2019, a representative of DB sent an e-mail to representatives of Goldman Sachs indicating that, subject to certain conditions, Parent would likely be prepared to eliminate the minimum cash requirement contained in its April 14, 2019 markup of the merger agreement, agree to a customary materiality qualifier with respect to the accuracy at closing of NRE’s tax representations, and work with NRE on other issues affecting deal certainty, including obtaining mortgage lender consents.

During 2019, management of NRE was actively engaged in a process to sell two German hotel assets to a third party in a sale that would be consummated prior to the closing of the transactions under the merger agreement. On May 28, 2019, management of NRE met with a potential purchaser of the two German hotel assets and discussed a transaction in which a sale document would be executed prior to June 30 and the sale of the two German hotel assets would be consummated in early September 2019.

On May 28, 2019, representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell spoke by telephone with representatives of Party C regarding the draft merger agreement furnished to Party C on May 12, 2019. The discussion focused principally on transaction structure, timing of closing and the scope of certain representations and warranties. Later on May 28 and continuing to May 30, 2019, Party C sent to representatives of Goldman Sachs a series of communications, including revised proposal letters. The estimated value of Party C’s proposal on May 30, 2019 was approximately $17.29 per share. The letters stated that Party C’s “final offer” for NRE was subject to adjustment for currency exchange rate fluctuations and changes in certain non-property, non-cash assets and liabilities. In addition, the letters indicated that Party C intended to finance its proposal through a combination of debt and equity, with proof of Party C’s equity financing to be furnished separately. Party C’s letters stated that it had obtained debt financing indications, but was continuing to explore debt financing alternatives. Party C also stated that it had completed its due diligence, but its financing sources required three weeks to complete their diligence starting from June 3, 2019. Party C’s May 28, 2019 letter further indicated that in due course it would provide a revised draft merger agreement reflecting the discussions earlier that day. Party C also requested a three-week exclusivity period.

Between May 28 and May 30, 2019, further discussions also took place between representatives of Goldman Sachs and representatives of DB concerning Parent’s request for expense reimbursement and Parent’s current

45

valuation for NRE. During these discussions, representatives of DB indicated that Parent’s prior proposal of approximately $17.50 per share would be adjusted lower to account for currency exchange movements and various diligence items, which representatives of Goldman Sachs estimated would imply an updated value of approximately $17.09 per share. However, Parent did not submit a revised offer letter. During this period, representatives of Goldman Sachs and representatives of DB also discussed the possibility of Parent presenting its valuation of NRE in a combination of U.S. dollars, Euros and pounds sterling rather than presenting its valuation on a U.S. dollar basis.

The SRC met on May 30, 2019, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs provided an overview of the respective valuations of Parent and Party C and updated the SRC on the discussions with each party, including with respect to price. The SRC and its advisors also discussed the status of the expense reimbursement request from Parent and the possibility of offering Party C expense reimbursement to continue working towards a transaction rather than agreeing to Party C’s request for exclusivity. The SRC determined not to agree to Party C’s request for exclusivity but determined it would be appropriate to offer expense reimbursement to each of Parent and Party C to encourage them to continue working towards a transaction.

On June 2, 2019, representatives of Goldman Sachs spoke by telephone with representatives of Party C regarding the offer to reimburse a portion of Party C’s expenses, rather than providing Party C with exclusivity. Following that discussion, representatives of Goldman Sachs sent a form of expense reimbursement letter drafted by Fried Frank to Party C, which contemplated reimbursement of up to $1 million of expenses of Party C provided that Party C satisfied certain requirements as to price and terms and conditions of its binding offer. Also on June 2, 2019, representatives of Goldman Sachs sent a revised draft expense reimbursement letter prepared by Fried Frank to representatives of DB, which similarly contemplated reimbursement of up to $1 million of expenses.

A meeting of the SRC took place on June 4, 2019, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance. Representatives of Goldman Sachs provided an overview of the current proposals from Parent and Party C and remaining open issues with each party. Messrs. Nia and Feldman of the management of NRE joined the meeting to share their perspective on the open issues. At this meeting, members of the SRC discussed the fact that Parent’s proposal was expected to be denominated in a combination of U.S. dollars, Euros and pounds sterling, and that holders of NRE common stock would be subject to currency risk with respect to the U.S. dollar consideration ultimately to be received upon exchange of Euro and pound sterling components of the merger consideration. Members of the SRC expressed interest in the possibility of hedging the transaction consideration, in order to protect stockholders against exchange rate fluctuations. Representatives of Goldman Sachs reviewed with the SRC potential sign-to-close foreign exchange hedging strategies that the SRC could consider.

On June 5, 2019, DLA furnished to Fried Frank a revised draft of the expense reimbursement letter. The revised draft requested reimbursement for up to $2 million of expenses, and as a condition of reimbursement required Parent to submit a final, binding proposal at a value not less than the sum of $5.82, €6.55 and £3.06 per share (subject to change for issues identified after April 14, 2019). The value presented in the draft expense reimbursement letter was based on Parent’s assumption that the two German hotel assets that NRE was in the process of negotiating to sell would be sold and NRE would have at least a specified level of cash on hand at closing. The proposal was also subject to the conditions in Parent’s April 14, 2019 markup of the merger agreement, provided that the parties agreed to negotiate in good faith to resolve certain matters, including with respect to tax representations and provisions related to mortgage lender consents. The DLA draft also contemplated a deadline for submission of its final bid of June 26, 2019.

On June 6, 2019, Fried Frank furnished to DLA a revised draft of the expense reimbursement letter. The revised draft largely accepted the changes proposed by DLA, while leaving the amount of expense reimbursement open.

46

On June 11, 2019, the SRC met, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs provided the SRC with an overview of their progress with each of Parent and Party C related to due diligence, valuation, mortgage lender consents, proposed expense reimbursement and timing. Representatives of Goldman Sachs indicated that Party C had responded favorably to their follow-up requests and continued to move forward in an effort to find more value and to secure funding for a transaction, and that Parent had begun the mortgage lender consent process and had generally agreed to terms of the expense reimbursement letter, other than the cap on the amount of the expense reimbursement. The SRC agreed Goldman Sachs should continue working with Parent to finalize the expense reimbursement letter. Later that day, NRE executed the expense reimbursement letter with Parent, with a cap on the amount of the expense reimbursement of $1.5 million.

On June 13, 2019, Party C furnished to Goldman Sachs a revised draft expense reimbursement letter. Party C’s draft provided that Party C would be entitled to expense reimbursement of up to $1 million provided that it submitted prior to the bid deadline a proposal confirming its agreement to negotiate in good faith to reach a definitive merger agreement on the terms contained in a markup to be furnished by counsel to Party C, and at a price per share to be specified. On the same day, Party C furnished to Goldman Sachs a markup of the draft merger agreement. Among other things, the revised draft: provided for the termination of the merger agreement if the merger was not approved by NRE stockholders by September 16, 2019 (regardless of when the proxy statement required to be sent to stockholders to seek such approval was cleared by the SEC); provided for a termination fee of €30 million plus reimbursement of Party C’s expenses if the merger agreement was terminated because stockholder approval was not obtained by September 16, 2019; provided that Party C would not be required to close if there were a material adverse change with respect to any subsidiary of NRE that owns real property; and eliminated materiality qualifiers in certain representations and warranties. The draft merger agreement also eliminated customary language requiring Party C to enforce its equity commitments.

On June 16, 2019, representatives of Goldman Sachs and Fried Frank spoke with representatives of Party C. In that conversation, Party C indicated that the draft merger agreement furnished on June 13, 2019 did not accurately reflect Party C’s positions. In addition, in response to questions from representatives of Goldman Sachs, Party C indicated that it was continuing to experience delays in advancing its debt financing commitments for the transaction.

At the direction of the SRC, over the weekend of June 15 and 16, 2019, representatives of Goldman Sachs spoke by telephone with representatives of Parent and Party C. The representatives of Goldman Sachs advised each of Parent and Party C that the deadline for final bids would be June 26, 2019.

On June 17, 2019, Fried Frank received a revised draft merger agreement from DLA. The revised draft agreement, among other things, expanded the scope of various representations and warranties, required NRE to operate within operating, capital expenditure and development expenditure budgets to be specified, and reinserted a condition with respect to the accuracy of tax representations with no materiality qualifiers, but largely accepted the conditions to closing reflected in Fried Frank’s prior draft of the merger agreement.

On June 19, 2019, representatives of Goldman Sachs furnished to Party C a revised draft merger agreement prepared by Fried Frank, which largely rejected the changes proposed by Party C in its draft of June 13, 2019.

On June 20, 2019, representatives of Fried Frank and Sullivan & Cromwell spoke by telephone with representatives of DLA regarding the open issues in DLA’s draft merger agreement. Later that day, the SRC met, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance. At this meeting, representatives of Goldman Sachs reviewed the status of discussions with each of Parent and Party C and suggested next steps. The SRC discussed the fact that, in light of the fact that Parent’s proposal would be denominated in a combination of U.S. dollars, Euros and pounds sterling, holders of NRE common stock would be subject to currency risk with respect to the U.S. dollar consideration ultimately to be received upon exchange of Euro and pound sterling components of the merger consideration. Members of the SRC again expressed

47

interest in the possibility of hedging the transaction consideration, in order to protect NRE stockholders against exchange rate fluctuations.

Following the SRC meeting of June 20, 2019, the management of NRE initiated discussions with certain third parties in order to explore potential currency hedges for the merger consideration in a transaction with Parent. These discussions continued up to the date of execution of the merger agreement.

On June 21, 2019, Fried Frank furnished a revised draft merger agreement to DLA. In the revised draft merger agreement, Fried Frank requested clarification of the financial capacity of Parent and of the investment fund providing the equity commitment for the transaction to perform their obligations under the agreement. In addition, the revised draft reflected, among other things, changes to various representations and warranties and budget-related provisions.

On June 24, 2019, DLA furnished a revised draft merger agreement to Fried Frank.

On June 25, 2019, a representative of Fried Frank sent an e-mail to representatives of DLA highlighting issues raised by DLA’s revised merger agreement. The principal issues identified by Fried Frank were: the inclusion of conditions to closing relating to the receipt of mortgage lender consents and the filing and escrow of certain French tax returns; provisions requiring NRE to adhere to certain budget requirements between signing and closing with limited scope for deviation; certain changes to closing conditions relating to the accuracy of representations and warranties; the treatment of two German hotel assets that NRE was in the process of negotiating to sell but for which NRE had not yet entered into binding agreements; and issues relating to the equity commitment to be provided by Parent’s equity financing source.

On June 26, 2019, representatives of Parent communicated to the advisors to the SRC that, given outstanding diligence requests and the need to find a resolution for the German hotel assets, Parent was requesting an extension of the bid date to July 8, 2019. The SRC rejected this request, but authorized an extension of the bid deadline from noon on June 26, 2019 to 7 p.m. on that date. Later on June 26, 2019, Parent furnished to the SRC a letter indicating that Parent expected to be able to submit a binding proposal by July 8, 2019. The letter did not specify a purchase price, was expressed to be subject to definitive documentation, completion of confirmatory due diligence, and resolution of certain additional matters communicated to NRE’s advisors. This letter was not accompanied by a draft merger agreement or equity commitment letter. Parent’s advisors requested that the advisors to the SRC confirm that this letter satisfied the terms and conditions set forth in the expense reimbursement letter between with Parent. At the direction of the SRC, the SRC’s advisors informed Parent’s advisors that, in the SRC’s view, the letter may not satisfy the terms and conditions of the expense reimbursement letter. Later that evening, DLA furnished to Fried Frank a revised merger agreement and an equity commitment letter, and representatives of DB furnished to representatives of Goldman Sachs a schedule showing the purchase price proposed by Parent. This schedule reflected merger consideration of the sum of $1.41, €9.59 and £3.82 per share, which was estimated to be equivalent to approximately $17.17 per share based on June 26, 2019 spot exchange rates. This proposed merger consideration was based on Parent’s assumption that the two German hotel assets would be sold prior to closing and NRE would have at least a specified level of cash on hand at closing. Later that evening, at the direction of the SRC, representatives of Fried Frank advised representatives of DLA that, based upon the materials provided by DLA and price discussions earlier that evening between representatives of DB and Goldman Sachs, Parent’s letter did satisfy the terms and conditions set forth in the expense reimbursement letter, subject to the understanding that Parent would engage in good faith negotiations to finalize the transaction.

Also on June 26, 2019, Party C submitted to representatives of Goldman Sachs a letter containing a revised, non-binding offer by Party C to acquire NRE. The letter stated that the value of Party C’s offer was $18.00 per share. After subsequent discussions between representatives of Goldman Sachs and principals of Party C regarding Party C’s valuation assumptions, Party C’s offer was estimated to have a value of approximately $17.20 per share. Party C’s letter indicated that Party C required until July 26, 2019 to complete lenders’ due diligence, obtain committed debt financing and finalize a transaction, and requested exclusivity until July 26, 2019.

48

The SRC met on June 27, 2019, with representatives of Fried Frank and Goldman Sachs in attendance. At this meeting, representatives of Goldman Sachs reviewed with the SRC the proposals from Parent and Party C. Representatives of Fried Frank reviewed with the SRC the open issues under the merger agreement with Parent, and noted that there remained only a small number of outstanding issues, including resolution of the treatment of the two German hotel assets that NRE was in the process of negotiating to sell. Representatives of Goldman Sachs reviewed with the SRC illustrative currency exchange rate hedging scenarios. In addition, representatives of Goldman Sachs reviewed with the SRC considerations relating to an internalization of the management of NRE. The members of the SRC instructed Goldman Sachs to share its presentation materials with management of NRE and determined to schedule a follow-up meeting that would include management of NRE.

During the day on June 27, 2019, various calls took place between Parent, NRE and their respective advisors regarding outstanding due diligence matters and the transaction documents. During these calls, at the direction of the SRC, representatives of NRE discussed with Parent the possibility of utilizing a transaction structure under which NRE would seek to dispose of the German hotel assets between signing and closing, with the merger consideration being subject to adjustment based on the proceeds received from such disposition and, if such disposition was not completed prior to closing, the merger consideration would be reduced and NRE stockholders would receive an interest in a trust holding those assets and the trust would distribute to its interest holders the net proceeds of the sale of the German hotel assets after closing.

Also at the direction of the SRC, representatives of Fried Frank and Goldman Sachs communicated to Parent and its representatives the importance of Parent completing its work and being in position to sign a definitive agreement by the opening of business on July 1, 2019.

On June 28, 2019, the SRC met, with management of NRE and representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell, in attendance. Members of the SRC and management of NRE discussed the likelihood of success and the possible challenges of an internalization of NRE management. Following this discussion, the members of NRE management left the meeting. A representative of Sullivan & Cromwell provided an overview of potential conflicts of interest of members of NRE management in connection with the strategic alternatives being considered by the SRC. Representatives of Goldman Sachs updated the SRC on timing and process to finalize a transaction with Parent.

Although NRE had continued discussions with a potential purchaser for the German hotel assets, NRE had not entered into a binding agreement to sell those assets by the last week of June 2019. On June 28, 2019, representatives of Parent communicated to representatives of Goldman Sachs an expectation that a binding agreement be in place prior to execution of the merger agreement. Alternatively, Parent again indicated that it would consider acquiring NRE with the German hotel assets, subject to a due diligence review of those assets.

Between June 28, 2019 and July 1, 2019, representatives of Fried Frank and DLA engaged in discussions with respect to remaining issues relating to the merger agreement, and the parties conducted due diligence calls on certain outstanding issues, including tax issues and the German hotel assets.

On July 1, 2019, Parent conducted site visits at the German hotel assets. Subsequently, at Parent’s request, management of NRE postponed discussions with the potential purchaser of the two German hotel assets.

The parties continued to exchange drafts of the merger agreement and disclosure schedules for the transaction, but did not finalize a transaction by the SRC’s target date of July 1, 2019. In addition, during this period, management of NRE engaged in discussions with third parties relating to potential currency hedges with respect to the Euro and pound sterling components of the merger consideration.

On June 28, 2019, Mr. Feldman spoke by telephone with the principals of Party C to clarify certain components of Party C’s asset by asset valuation of NRE. In addition, between June 30, 2019 and July 2, 2019, representatives of Goldman Sachs continued to engage in discussions with principals of Party C regarding the

49

value of Party C’s proposal and the time required for Party C to complete its work and present a fully-financed proposal. Party C continued to indicate that it required several weeks to deliver a fully-financed proposal.

On July 2, 2019, in order to address NRE’s concerns with respect to the financial capacity of Parent to perform its obligations under the merger agreement, Parent agreed that, in the event that NRE were unable to obtain specific performance of the obligation of Parent to consummate the transaction following the satisfaction of the conditions to the obligation of Parent to close the transaction or if the transaction failed to close due to a breach by Parent, NRE would be entitled to a reverse termination fee of approximately 6% of equity value, and the equity commitment of Parent’s equity financing source would be available to satisfy Parent’s obligation to pay the reverse termination fee.

On the evening of July 2, 2019, representatives of Parent conveyed to representatives of Goldman Sachs a final proposal that included the acquisition of NRE with the German hotel assets, for aggregate consideration of the sum of $1.68, €9.26 and £3.82 per share. This proposal reflected adjustments for the inclusion of the German hotel assets and a projected lower cash balance at September 30, 2019, and was estimated to be equivalent to approximately $16.95 per share based on July 2, 2019 spot exchange rates. Parent advised representatives of Goldman Sachs that Parent would not support an alternative in which NRE disposed of the German hotel assets to a third party and distributed the proceeds to NRE stockholders. Two meetings of the SRC were held on the morning of July 3, 2019. At the first meeting, with members of NRE management and representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance, a representative of Fried Frank summarized the status of the transaction and noted that it would likely take some hours to finalize the transaction documents. The representative of Fried Frank reviewed the duties of the members of the SRC, summarized the material terms of the transaction and outlined potential considerations that members of the SRC might consider relevant in making a determination whether to recommend the transaction to the NRE board.

A second meeting of the SRC was held later on the morning of July 3, 2019, with representatives of Fried Frank, Goldman Sachs and Sullivan & Cromwell in attendance. At this meeting, representatives of Goldman Sachs reviewed with the SRC its financial analyses and then rendered to the SRC its oral opinion, which was subsequently confirmed by delivery of a written opinion dated July 3, 2019, to the SRC to the effect that, as of the date of its written opinion and based upon and subject to the various assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Goldman Sachs in preparing its written opinion, as set forth in such opinion, the $1.68, plus €9.26, plus £3.82 per share of NRE common stock to be paid by Parent pursuant to the merger agreement was fair from a financial point of view to such holders (see the section entitled “—Opinion of the Financial Advisor to the SRC” beginning on page [—] of this proxy statement). Following the delivery of the opinion of Goldman Sachs, the members of the SRC unanimously determined the merger agreement and all related agreements and documents to be advisable and in the best interest of NRE, and resolved to recommend to the NRE board that it approve the execution, delivery and performance by NRE, the Partnership and the Partnership Merger Sub of the transaction documents, including the merger agreement. The SRC agreed to reconvene in the afternoon of July 3, 2019 to present its recommendation to the full NRE board. The SRC also authorized the execution of a six-month forward contract with DB AG London to hedge currency risk with respect to the Euro and pound sterling components of the merger consideration.

During the course of the day on July 3, 2019, the parties finalized the transaction documents and proposed form of press release announcing the execution of the merger agreement. In addition, during the day, NRE executed a six-month forward contract with DB AG London to hedge currency risk with respect to the Euro and pound sterling components of the merger consideration.

The NRE board met in the afternoon of July 3, 2019, with members of NRE management and representatives of Fried Frank, Goldman Sachs, Sullivan & Cromwell and Venable in attendance. At this meeting, a representative of Venable made a presentation to the members of the NRE board with respect to the duties of each member of the NRE board. The SRC then presented its recommendation of the merger agreement

50

and the transaction documents to the NRE board. After discussion, the NRE board unanimously declared the merger agreement and all related agreements and documents to be advisable and in the best interest of NRE and approved the execution, delivery and performance, by NRE, the Partnership and the Partnership Merger Sub of the transaction documents, including the merger agreement, and directed that the merger be submitted for consideration at the special meeting, with the recommendation that NRE stockholders vote to approve the same.

Later in the afternoon of July 3, 2019, NRE and Parent issued a joint press release announcing the execution of the merger agreement.

Reasons for the Mergers; Recommendation of the SRC and the NRE Board

Reasons for the Mergers

At a meeting held on July 3, 2019, the members of the SRC unanimously determined the merger agreement and all related agreements and documents to be advisable and in the best interest of NRE, and resolved to recommend to the NRE board that it approve the execution, delivery and performance by NRE, the Partnership and Partnership Merger Sub of the transaction documents, including the merger agreement. At a meeting of the NRE board later on July 3, 2019, the members of the NRE board unanimously declared the merger agreement and all related agreements and documents to be advisable and in the best interest of NRE and approved the execution, delivery and performance, by NRE, the Partnership and Partnership Merger Sub of the transaction documents, including the merger agreement, and resolved to recommend, on the terms and subject to the conditions of the merger agreement, that NRE stockholders vote in favor of the approval of the merger.

In reaching their respective determinations and recommendations, the SRC and the NRE board reviewed, evaluated and considered a number of factors, including the following:

51

52

In addition, the NRE board considered the recommendation of the SRC in favor of the merger agreement and the transactions contemplated thereby, which reflected the deliberations and determinations of the SRC at the conclusion of more than two years of efforts by the SRC to maximize value for NRE stockholders, with the advice and assistance of its legal and financial advisors.

The SRC and the NRE board also identified and considered a variety of risks and other potentially negative factors related to the merger agreement and the transactions contemplated thereby, including:

53

The foregoing discussion of certain information and factors considered by the SRC and the NRE board, as applicable, is not exhaustive but is intended to reflect the principal factors considered by the SRC and the NRE board in consideration of the merger agreement and the transactions contemplated thereby. In light of the number and complexity of the factors considered, the SRC and the NRE board did not assign any relative or specific weight to those various factors. Rather, the SRC and the NRE board based their respective recommendations on the totality of the information presented to and considered by each of them and such other factors as they deemed relevant. In addition, individual members of the SRC and the NRE board may have given weight to different factors not mentioned above.

The foregoing discussion of the information and factors considered by each of the SRC and the NRE board includes forward-looking information. This information should be read in light of the factors described under the section entitled “Cautionary Statement Concerning Forward-Looking Statements” beginning on page [—] of this proxy statement.

Recommendation of the SRC and NRE Board

At a meeting held on July 3, 2019, the members of the SRC unanimously adopted resolutions recommending that the NRE board: (i) declare advisable and in the best interests of NRE the adoption of the merger agreement and, on the terms and subject to the conditions set forth in the merger agreement, the merger and the other transactions contemplated by the merger agreement; (ii) approve and authorize the execution, delivery and performance of the merger agreement and all related agreements and documents, on the terms and subject to the conditions set forth in the merger agreement and all related agreements and documents, including the letter agreement between DB AG London, and the Partnership setting forth the terms and conditions of a transaction pursuant to which the Partnership would agree to purchase U.S. dollars in exchange for Euros and pounds sterling at a future trade date for the purpose of hedging the portion of the aggregate merger consideration denominated in Euros and pounds sterling subject to the ISDA Master Agreement, dated as of October 6, 2017, as amended and supplemented in accordance with its terms from time to time between the Partnership and DB AG London; and (iii) direct that the merger be submitted for consideration at the special meeting, with the recommendation that NRE stockholders vote to approve the same.

At a meeting of the NRE board later on July 3, 2019, the members of the NRE board unanimously, following the unanimous recommendation of the SRC, (i) declared advisable and in the best interests of NRE the adoption of the merger agreement and, on the terms and subject to the conditions set forth in the merger agreement, the merger and the other transactions contemplated by the merger agreement, (ii) approved and authorized the execution, delivery, and performance of the merger agreement and all related agreements and documents, on the terms and subject to the conditions set forth in the merger agreement and all related agreements and documents, including the letter agreement between DB AG London and the Partnership setting forth the terms and conditions of a transaction pursuant to which the Partnership would agree to purchase U.S. dollars in exchange for Euros and pounds sterling at a future trade date for the purpose of hedging the portion of the aggregate merger consideration denominated in Euros and pounds sterling subject to the ISDA Master Agreement, dated as of October 6, 2017, as amended and supplemented in accordance with its terms from time to time between the Partnership and DB AG London, and (iii) directed that the merger be submitted for consideration at the special meeting, with the recommendation that NRE stockholders vote to approve the same.

Accordingly, the NRE board, following the unanimous recommendation of the SRC, unanimously recommends that you vote “FOR” the merger proposal.

54

Opinion of the Financial Advisor to the SRC

Opinion of Goldman Sachs

At a meeting of the SRC on July 3, 2019, Goldman Sachs delivered its oral opinion, subsequently confirmed in writing, to the SRC that, as of July 3, 2019 and based upon and subject to the factors and assumptions set forth therein, the unconverted per share consideration to be paid to holders (other than Parent and its affiliates) of NRE common stock pursuant to the merger agreement was fair from a financial point of view to such holders.

The full text of the written opinion of Goldman Sachs, dated July 3, 2019, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B to this proxy statement. Goldman Sachs provided advisory services and its opinion for the information and assistance of the SRC in connection with its consideration of the mergers. The Goldman Sachs opinion is not a recommendation as to how any holder of NRE common stock should vote with respect to the merger, or any other matter.

In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

Goldman Sachs also held discussions with members of the senior management of NRE regarding their assessment of the past and current business operations, financial condition and future prospects of NRE; reviewed the reported price and trading activity for NRE common stock; compared certain financial and stock market information for NRE with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the commercial real estate industry; and performed such other studies and analyses, and considered such other factors, as it deemed appropriate.

For purposes of rendering this opinion, Goldman Sachs, with the SRC’s consent, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by, it, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with the SRC’s consent that the Forecasts were reasonably prepared on a basis reflecting the then best currently available estimates and judgments of the SRC. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of NRE or any of its subsidiaries and it was not furnished with any such evaluation or appraisal. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the merger will be obtained without any adverse effect on the expected benefits of the merger in any way meaningful to its analysis. Goldman Sachs has also assumed that the merger will be consummated on the terms set forth in the merger agreement, without the waiver

55

or modification of any term or condition the effect of which would be in any way meaningful to its analysis. Goldman Sachs has also assumed at the SRC’s instruction that, as reflected in the Forecasts, no distributions pursuant to Section 6.15 of the merger agreement will be made between the date of the merger agreement and the consummation of the merger.

Goldman Sachs’ opinion does not address the underlying business decision of NRE to engage in the merger or the relative merits of the merger as compared to any strategic alternatives that may be available to NRE; nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs’ opinion addresses only the fairness from a financial point of view, as of the date of the opinion, of the unconverted per share consideration to be paid to holders (other than Parent and its affiliates) of NRE common stock pursuant to the merger agreement. Goldman Sachs’ opinion does not express any view on, and does not address, any other term or aspect of the merger agreement or the merger or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection with the merger, including the fairness of transactions contemplated by Section 6.08 of the merger agreement, any hedging activities taken by or on behalf of NRE or its affiliates, including any currency hedging activities taken or to be taken with respect to the unconverted per share consideration, any allocation of the unconverted per share consideration, the fairness of the mergers to, or any consideration received in connection therewith by, the holders of any other class of securities of NRE, any class of securities of the Partnership or any other persons, creditors or other constituencies of NRE or the Partnership; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers or directors of NRE, or class of such persons in connection with the mergers, whether relative to the unconverted per share consideration to be paid to the holders (other than Parent and its affiliates) of NRE common stock pursuant to the merger agreement or otherwise. Goldman Sachs’ opinion was necessarily based on economic, monetary, market, exchange rates and other conditions, as in effect on, and the information made available to it as of, the date of the opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. In addition, Goldman Sachs does not express any opinion as to the impact of the merger on the solvency or viability of NRE or Parent or the ability of NRE or Parent to pay their respective obligations when they come due. Goldman Sachs’ opinion was approved by a fairness committee of Goldman Sachs.

Summary of Financial Analyses

The following is a summary of the material financial analyses delivered by Goldman Sachs to the SRC in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs’ financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before July 2, 2019, the last trading day before the public announcement of the merger and is not necessarily indicative of current market conditions.

Implied Premia and Multiples Analysis

Goldman Sachs analyzed solely for informational purposes the implied consideration of $16.95 to be paid to holders of NRE common stock pursuant to the merger agreement, calculated by converting the Euro and pound sterling portions of the unconverted per share consideration to U.S. dollars using EUR/USD and GBP/USD spot foreign exchange rates as of July 2, 2019 in relation to the undisturbed price per share of NRE common stock as of November 6, 2018, the last trading day prior to the date that NRE announced that the SRC was conducting a process to review strategic alternatives, including a potential sale of NRE, and the high and 20-day volume weighted average price per share of NRE common stock, which we refer to as the 20-Day VWAP, over the 12-month period ended November 6, 2018.

56

The results of this analysis are as follows:

In addition, Goldman Sachs calculated solely for informational purposes an implied equity value for NRE, which we refer to as the Implied Equity Value, by multiplying the implied consideration of $16.95 per share of NRE common stock by the total number of shares of NRE common stock outstanding as of June 26, 2019 on a fully diluted basis. Goldman Sachs also calculated solely for informational purposes an implied enterprise value for NRE, which we refer to as the Implied Enterprise Value, by adding to the Implied Equity Value NRE’s net debt (calculated as debt and capital leases less cash and cash equivalents) and non-controlling interests, each as of March 31, 2019.

Using the foregoing, Goldman Sachs calculated solely for informational purposes the following implied multiples:    

The results of these calculations were as follows:

Illustrative Present Value of Future Share Price Analysis

Goldman Sachs performed an illustrative analysis of the implied present value of a future value per share of NRE common stock, including the present value of accumulated dividends, which is designed to provide an indication of the present value of a theoretical future value of a company’s equity as a function of such company’s financial multiples, based on applying a percentage premium or discount to projected net asset value, which we refer to as NAV, per share of NRE common stock. For this analysis, Goldman Sachs first derived a range of theoretical future values per share for NRE common stock as of December 31, 2019, 2020, 2021 and 2022, by applying a percentage discount rate ranging from 10% to 30% to estimates of NRE’s NAV per share for each of the fiscal years ending December 31, 2019, 2020, 2021 and 2022, respectively, reflected in the Forecasts. The percentage discounts that were applied were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account percentage discounts of NRE common stock price to its estimated NAV per share since December 2015, which ranged between a 31.8% discount to 11.7% discount, and percentage premiums or discounts of common stock prices to estimated NAV per share for comparable companies, which ranged between a 25.9% discount to a 6.7% premium. Goldman Sachs then discounted to present value as of March 31, 2019 the theoretical future values per share of NRE common stock it derived and the estimated dividends to be paid per share of NRE common stock through the end of the applicable year as reflected in the

57

Forecasts by a discount rate of 6.1%, which reflects an estimate of NRE’s cost of equity, derived by application of the Capital Asset Pricing Model, which we refer to as CAPM, which incorporates certain company-specific inputs, including, among others, a beta for the company, as well as certain financial metrics for the U.S. markets generally, to present value as of March 31, 2019, to yield illustrative present values per share of NRE common stock ranging from $12.45 to $18.44.

Goldman Sachs also performed an illustrative analysis of the implied present value of a future value per share of NRE common stock, including the present value of accumulated dividends, based on next 12 months, which we refer to as NTM, funds from operations, which we refer to as FFO, multiples. For this analysis, Goldman Sachs first derived a range of theoretical future values per share for NRE common stock as of December 31, 2019, 2020, 2021 and 2022, by multiplying NTM FFO multiples ranging from 14.0x to 18.0x by estimates of NRE’s FFO for the NTM period for each of the fiscal years ending December 31, 2019, 2020, 2021 and 2022, respectively, reflected in the Forecasts and adding accumulated dividends over the same periods of time. These illustrative NTM FFO multiple estimates were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account annual average consensus NTM FFO multiples for NRE common stock since December 2015, based on publicly available consensus estimates from the Institutional Brokers’ Estimate System, which we refer to as IBES, which ranged between 14.6x to 26.6x, and annual average consensus NTM FFO multiples for comparable companies, based on publicly available consensus estimates from IBES, which ranged between 15.3x to 23.3x. Goldman Sachs then discounted to present value as of March 31, 2019 the theoretical future values per share of NRE common stock it derived and the estimated dividends to be paid per share of NRE common stock through the end of the applicable year as reflected in the Forecasts by a discount rate of 6.1%, which reflects an estimate of NRE’s cost of equity, derived by application of the CAPM, to yield illustrative present values per share of NRE common stock ranging from $15.06 to $21.11.

Illustrative Discounted Cash Flow Analysis

Using the Forecasts, Goldman Sachs performed an illustrative levered discounted cash flow analysis on NRE. Using discount rates ranging from 6.0% to 7.0%, reflecting estimates of NRE’s cost of equity, Goldman Sachs discounted to present value as of July 2, 2019 (i) estimates of levered free cash flow for NRE for the years 2019 through 2023 as reflected in the Forecasts, and (ii) a range of illustrative terminal values for NRE, which were calculated by applying perpetuity growth rates ranging from 1.0% to 2.0% to a terminal year estimate of the levered free cash flow to be generated by NRE, as reflected in the Forecasts (which analysis implied exit terminal year EBITDA multiples ranging from 16.6x to 25.1x). Goldman Sachs derived such discount rates by application of the CAPM. The range of perpetuity growth rates was estimated by Goldman Sachs utilizing its professional judgment and experience, taking into account the market expectations regarding long-term real growth of gross domestic product and inflation. Goldman Sachs derived ranges of illustrative equity values for NRE by adding the ranges of present values it derived above. Goldman Sachs then divided the range of illustrative equity values it derived by the number of outstanding shares of NRE common stock as of June 26, 2019 on a fully diluted basis, as provided by management of NRE, to derive a range of illustrative present values per share ranging from $13.81 to $23.09.

58

Selected Precedent Transactions Analysis

Goldman Sachs reviewed and analyzed, using publicly available information, the acquisition premia for transactions announced during the six-year period ending on July 2, 2019 involving a publicly-traded U.S. REIT target (excluding mortgage REIT transactions). For the entire period, using publicly available information, Goldman Sachs calculated the median, 25th percentile and 75th percentile premiums of the price paid in the transactions relative to the target’s last undisturbed closing stock price prior to announcement of the transaction. The selected transactions and the implied premia calculated for each of the transactions (as well as the implied transaction value) are set forth below:

59

This analysis indicated a median premium of 15.0% across the period. This analysis also indicated a 25th percentile premium of 13.1% and 75th percentile premium of 19.4% across the period. Using this analysis, Goldman Sachs applied a reference range of illustrative premiums of 13% to 19% to the undisturbed closing price per share of NRE common stock of $14.63 as of November 6, 2018 and calculated a range of implied equity values per share of NRE common stock of $16.55 to $17.47.

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Goldman Sachs’ opinion. In arriving at its fairness determination, Goldman Sachs considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Goldman Sachs made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to NRE or Parent or the contemplated transaction.

Goldman Sachs prepared these analyses for purposes of Goldman Sachs’ providing its opinion to the SRC as to the fairness from a financial point of view of the unconverted per share consideration to be paid to holders (other than Parent and its affiliates) of NRE common stock pursuant to the merger agreement. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, none of NRE, Parent, Goldman Sachs or any other person assumes responsibility if future results are materially different from those forecasts.

60

The unconverted per share consideration was determined through arm’s-length negotiations between NRE and Parent and was approved by the SRC. Goldman Sachs provided advice to the SRC during these negotiations. Goldman Sachs did not, however, recommend any specific amount of consideration to NRE or the SRC or that any specific amount of consideration constituted the only appropriate consideration for the merger.

As described above, Goldman Sachs’ opinion to the SRC was one of many factors taken into consideration by the SRC in making its determination to approve the mergers. The foregoing summary does not purport to be a complete description of the analyses performed by Goldman Sachs in connection with the fairness opinion and is qualified in its entirety by reference to the written opinion of Goldman Sachs attached as Annex B to this proxy statement.

Goldman Sachs and its affiliates are engaged in advisory, underwriting and financing, principal investing, sales and trading, research, investment management and other financial and non-financial activities and services for various persons and entities. Goldman Sachs and its affiliates and employees, and funds or other entities they manage or in which they invest or have other economic interests or with which they co-invest, may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments of NRE, Parent, any of their respective affiliates and third parties, including Colony , subsidiaries of which are, respectively, a significant stockholder and the external manager of NRE, and AXA SA, which we refer to as AXA, an affiliate of Parent, or any currency or commodity that may be involved in the merger contemplated by the merger agreement. Goldman Sachs acted as financial advisor to the SRC in connection with, and participated in certain of the negotiations leading to, the merger contemplated by the merger agreement. Goldman Sachs has provided certain financial advisory and/or underwriting services to NRE and its affiliates from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation. During the two-year period ended July 3, 2019, Goldman Sachs has recognized compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to NRE and/or its affiliates of approximately $2.3 million. Goldman Sachs also has provided certain financial advisory and/or underwriting services to AXA and its affiliates from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation, including having acted as co-manager with respect to a public offering for AXA Equitable Holdings, Inc., which we refer to as AXA Equitable Holdings, an affiliate of AXA, of its 5.000% Senior Notes due 2048, its 4.350% Senior Notes due 2028 and its 3.900% Senior Notes due 2023 (aggregate principal amount $3.8 billion) in April 2018; as sole bookrunner with respect to AXA’s collateralized loan obligation (aggregate principal amount of $410 million) in May 2018; as a joint bookrunner with respect to the initial public offering of 157,837,500 shares of common stock of AXA Equitable Holdings in May 2018; as sole bookrunner with respect to AXA’s collateralized loan obligation (aggregate principal amount of $480 million) in July 2018; as sole bookrunner with respect to AXA’s collateralized loan obligation (aggregate principal amount of $400 million) in August 2018; as a co-manager with respect to a follow-on offering of 60,000,000 shares of common stock of AXA Equitable Holdings in November 2018; as financial advisor to AXA with respect to its pending acquisition of the outstanding shares of AXA Tianping Property & Casualty Insurance Company Ltd that it does not currently hold announced in November 2018; and as a joint bookrunner with respect to a follow-on offering of 40,000,000 shares of common stock of AXA Equitable Holdings in March 2019. During the two-year period ended July 3, 2019, Goldman Sachs has recognized compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to AXA and/or its affiliates and portfolio companies (which may include companies that are not controlled by AXA) of approximately $7.8 million. During the two-year period ended July 3, 2019, the Investment Banking Division of Goldman Sachs has not been engaged by Parent, Merger Sub or the Sponsor to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. Goldman Sachs also has provided certain financial advisory and/or underwriting services to Colony and its affiliates from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation. During the two-year period ended July 3, 2019, the Investment Banking Division of Goldman Sachs has not been engaged by Colony or its affiliates, other than NRE as described above, to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. Goldman Sachs may also in the future provide financial advisory and/or underwriting

61

services to NRE, Parent, the Partnership, Colony, AXA and their respective affiliates and, as applicable, portfolio companies for which the Investment Banking Division of Goldman Sachs may receive compensation. Affiliates of Goldman Sachs also may have co-invested with the AXA, Colony and their respective affiliates from time to time and may have invested in limited partnership units of affiliates of Colony and AXA from time to time and may do so in the future.

The SRC selected Goldman Sachs as its financial advisor because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the mergers. Pursuant to a letter agreement dated March 19, 2018, as amended on April 29, 2019, the SRC engaged Goldman Sachs to act as its financial advisor in connection with the contemplated merger. As amended, the engagement letter between the SRC and Goldman Sachs provides for a transaction fee of $14 million, the principal portion of which is contingent upon consummation of the mergers. In addition, NRE has agreed to reimburse Goldman Sachs for certain of its expenses, including attorneys’ fees and disbursements, and to indemnify Goldman Sachs and related persons against various liabilities, including certain liabilities under the federal securities laws.

Certain NRE Forecasts

NRE does not, as a matter of course, publicly disclose long-term projections as to future revenues, earnings or other results due to, among other reasons, the uncertainty, unpredictability and subjectivity of the underlying assumptions and estimates. However, in connection with the evaluation of a possible transaction involving NRE, NRE provided to the SRC’s financial advisor, Goldman Sachs, certain non-public unaudited financial forecasts covering multiple years that were prepared by the management of NRE and not for public disclosure.

A summary of certain of the Forecasts is not being included in this document to influence your decision whether to vote for or against the merger proposal, but is being included because they were made available to the SRC’s financial advisor, Goldman Sachs. The inclusion of this information should not be regarded as an indication that the SRC, the NRE board, their advisors or any other person considered, or now considers, the Forecasts to be material or to be a reliable prediction of actual future results, and the Forecasts should not be relied upon as such. The internal financial forecasts of the management of NRE, upon which the Forecasts were based, are subjective in many respects. There can be no assurance that the Forecasts will be realized or that actual results will not be significantly higher or lower than forecasted. The Forecasts cover multiple years and such information by its nature becomes subject to greater uncertainty with each successive year. As a result, the inclusion of the Forecasts in this proxy statement should not be relied on as necessarily predictive of actual future events.

In addition, the Forecasts were not prepared with a view toward public disclosure or toward complying with generally accepted accounting principles, which we refer to as GAAP, the published guidelines of the SEC regarding projections and the use of non-GAAP measures or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for financial information presented in compliance with GAAP, and non-GAAP financial measures as presented in this proxy statement may not be comparable to similarly titled amounts used by NRE or other companies. The Forecasts have been prepared by, and is the responsibility of the management of NRE. PricewaterhouseCoopers, Société cooperative, NRE’s independent registered public accounting firm, has not audited, reviewed, examined, compiled nor applied agreed-upon procedures with respect to the Forecasts and, accordingly, PricewaterhouseCoopers, Société coopérative does not express an opinion or any other form of assurance with respect thereto. The inclusion of the PricewaterhouseCoopers, Société coopérative report as incorporation by reference relates to NRE’s previously issued financial statements. It does not extend to the Forecasts and should not be read to do so.

Additionally, although the Forecasts presented below are presented with numerical specificity, they are not facts. The Forecasts were based on numerous variables and assumptions that were deemed to be reasonable as of

62

the respective dates when such projections were finalized. Such assumptions are inherently uncertain and may be beyond the control of NRE. Important factors that may affect actual results and cause these Forecasts not to be achieved include, but are not limited to, risks and uncertainties relating to NRE’s business (including its ability to achieve strategic goals, objectives and targets), industry performance, the legal and regulatory environment, general business and economic conditions and other factors described or referenced under “Cautionary Statement Regarding Forward-Looking Statements” beginning on page [—] of this proxy statement. In addition, the Forecasts reflect assumptions that are subject to change and do not reflect revised prospects for NRE’s business, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the Forecasts were prepared. NRE has not prepared revised forecasts to take into account other variables that have changed since the dates on which the Forecasts were finalized. There can be no assurance that the Forecasts will be realized or that NRE’s future financial results will not materially vary from the Forecasts. NRE will shortly make publicly available its actual results of operations for the fiscal quarter ended June 30, 2019, and stockholders are urged to review carefully NRE’s Quarterly Report on Form 10-Q for such period when it is filed.

In developing the Forecasts, the management of NRE made numerous material assumptions with respect to NRE for the periods covered by such forecasts, including:

63

The following is a summary of the Forecasts prepared by NRE’s management (in millions and reflect a forward foreign exchange curve for all U.S. dollar equivalent):

Financing of the Mergers

The Sponsor has provided to Parent the equity commitment letter pursuant to which the Sponsor has agreed to purchase, or cause the purchase of, equity and/or debt securities of Parent for a maximum amount equal to the sum of approximately €384.2 million plus approximately £168.6 million to fund the amounts payable by Parent pursuant to the merger agreement. The balance of the funds required to finance the amounts payable by Parent pursuant to the merger agreement will be obtained from available cash of NRE and its subsidiaries.

Closing and Effective Time of Mergers

The mergers will occur only if the closing conditions contained in the merger agreement are satisfied or waived. The mergers will be completed legally at the time the appropriate certificates or articles of merger have

64

been duly filed with and accepted for record by the State Department of Assessments and Taxation of Maryland and with the Secretary of the State of Delaware, as applicable, and at the time any other filings, recordings or publications required to be made in connection with the mergers have been made, or at such later time as may be agreed by the parties and specified in the articles of merger (which may not be more than 30 days after the articles of merger have been accepted for record); provided that the effective time of the partnership merger shall be immediately before the effective time of the merger. However, there can be no assurance as to when or if the mergers or the other transactions contemplated by the merger agreement will occur.

Subject to the fulfillment or waiver of the conditions to the mergers, the mergers are expected to be completed in the fourth quarter of 2019.

Payment of Merger Consideration and Surrender of Shares

Prior to the effective time of the merger and the partnership merger, Parent or Merger Sub shall enter into an agreement that is reasonably acceptable to NRE with a paying agent selected by Parent with NRE’s prior approval for the purposes of paying the merger consideration to stockholders of NRE and the holders of common units and LTIP units. At or prior to the effective time of the partnership merger, Parent shall deposit an amount in cash with the paying agent that, when taken together with the available cash of NRE and its subsidiaries that is deposited with the paying agent, is sufficient in the aggregate for the paying agent to satisfy payments of the merger consideration to holders of NRE common stock, common units and LTIP units, which we refer to as the exchange fund, as provided for in the merger agreement.

The U.S. dollar, Euro and pound sterling components of the funds deposited by Parent will be consistent with the relative portions of the per share consideration that are denominated in U.S. dollars, Euros and pounds sterling. In accordance with the hedging agreements, Parent and NRE will cause DB AG London to convert the Euro and pound sterling components of the exchange fund into U.S. dollars. Any outstanding hedges relating to the mergers must be unwound prior to the effective time of the merger and mark-to-market present valued and settled net against the U.S. dollars being delivered to the exchange fund. Immediately following such conversion and at or prior to the effective time of the merger, Parent and NRE will cause DB AG London to deposit the exchange fund with the paying agent, in trust for the benefit of the holders of NRE common stock (other than cancelled shares and restricted shares of NRE common stock), common units and LTIP units outstanding immediately prior to the effective time of the partnership merger.

Promptly after the closing, Parent and the Surviving Entity shall cause the paying agent to mail or otherwise provide to each holder of NRE common stock (other than cancelled shares and restricted shares of NRE common stock), common units or LTIP units:

Each NRE share certificate, book-entry share, common unit and LTIP unit shall be deemed at any time after the closing to represent only the right to receive the per share consideration. All payments made with respect to the merger consideration will be paid without interest.

65

Interests of NRE’s Directors and Executive Officers in the Mergers

The interests that NRE’s directors and executive officers may have in the mergers that are different from, or in addition to, those of NRE stockholders generally include the following:

In addition, the external manager of NRE has a number of interests in the mergers that are different from, or in addition to, those of NRE stockholders generally, as set forth in the section entitled “—Background of the Mergers” beginning on page [—] of this proxy statement. Certain of NRE’s directors and director nominees up for election by NRE stockholders at the 2019 annual meeting and all of NRE’s executive officers have relationships with the external manager of NRE. Thomas J. Barrack, Jr., who is a nominee for election as a director at the 2019 annual meeting, is the Founder, Executive Chairman and Chief Executive Officer of Colony, which is the indirect parent entity of the external manager of NRE. Richard B. Saltzman, who is currently and will serve as a director of NRE and Chairman of the NRE board until the 2019 annual meeting, is the former President and Chief Executive Officer of Colony. All of NRE’s executive officers are employees of the external manager of NRE or its affiliates.

The NRE board and the SRC were aware of and considered these interests, among other matters, in evaluating and, in the case of the SRC, negotiating the merger agreement and merger and in recommending that the merger agreement be adopted by NRE stockholders.

Accelerated Vesting of Restricted Shares of NRE Common Stock and RSUs

Restricted Shares of NRE Common Stock

At the effective time of the merger, any vesting conditions applicable to each outstanding restricted share of NRE common stock granted under NRE’s equity incentive plan will automatically and without any action required on the part of the holder thereof, accelerate in full and each restricted share of NRE common stock will be converted into the right to receive cash in an amount equal to the per share consideration, without interest and less applicable withholding taxes.

The table below sets forth the number of unvested restricted shares of NRE common stock held by NRE’s executive officers and management directors and director nominees, which includes Mahbod Nia, Chief Executive Officer and President of NRE, and Messrs. Saltzman and Barrack, as of the date hereof. None of NRE’s non-management directors hold any unvested restricted shares of NRE common stock.

66

Performance-Based Restricted Stock Units

Pursuant to the merger agreement, immediately prior to the effective time of the merger, any vesting conditions applicable to each outstanding award of RSUs subject to performance-based vesting conditions granted under NRE’s equity incentive plan will be treated in accordance with the terms set forth in the applicable award agreement, provided that the compensation committee of the NRE board may cause these awards to be vested at levels reflecting achievement of the applicable performance-based vesting conditions at the maximum level. At the effective time of the merger, each RSU that vests in connection with the merger will automatically and without any action required on the part of the holder thereof, be cancelled, and Parent will cause the Surviving Entity to pay to each such holder cash in an amount equal to the per share consideration (plus any amount owed with respect to past dividends in accordance with the terms set forth in the applicable award agreement), without interest and less any applicable withholding taxes. Any RSU that does not vest will terminate without consideration immediately prior to the effective time of the merger.

All of the outstanding RSUs are subject to vesting based on NRE’s TSR on either an absolute basis or a relative basis as compared to the MSCI US REIT Index. The outstanding RSUs consist of (i) RSUs granted on March 7, 2016 in connection with the spin-off, which are subject to performance-based vesting hurdles based on the absolute and relative TSR of NRE from the grant date through December 31, 2019 and which we refer to as the Spin-off Absolute TSR RSUs and Spin-off Relative TSR RSUs, respectively, and (ii) RSUs granted in March 2018 as part of an annual equity compensation pool intended to serve as long-term bonus for 2017, which are subject to performance-based vesting hurdles based on the absolute and relative TSR of NRE during the three-year period ending on February 28, 2021 and which we refer to as the 2018 Absolute TSR RSUs and 2018 Relative TSR RSUs, respectively.

The table below sets forth the number of RSUs, at the maximum performance level, held by NRE’s executive officers and management directors and director nominees as of the date hereof. None of NRE’s non-management directors hold any RSUs.

The dividend equivalents that will be owed under the terms of these RSUs, based on dividends paid to date plus the $0.15 per share dividend that NRE is permitted to pay for the fiscal quarter ended June 30, 2019, will equal $2.25 per RSU for the Spin-off Absolute TSR RSUs and Spin-off Relative TSR RSUs and $1.05 per RSU for the 2018 Absolute TSR RSUs and 2018 Relative TSR RSUs.

Pursuant to the terms of the outstanding RSUs held by NRE’s executive officers and management directors and director nominees, upon the consummation of the mergers, each of these awards will vest based on the greater of (i) the percentage of such award that would have been earned if the price of NRE common stock at the end of the performance period was equal to the value of the per share consideration, (ii) a prorated percentage based either on the percentage of the performance period that had elapsed through the date of the mergers (for the Spin-off Absolute TSR RSUs and Spin-off Relative TSR RSUs) or on the amount that would have been earned based on annualized performance through the consummation of the mergers prorated for the percentage of the performance period that had elapsed through the date of the mergers (for the 2018 Absolute TSR RSUs and 2018 Relative TSR RSUs), or (iii) a performance percentage of 100%. Based on the performance of the MSCI US REIT Index through the date of the merger agreement, if the mergers were completed on September 30, 2019, all of these outstanding RSUs, other than the 2018 Relative TSR RSUs, would have vested at or just slightly below

67

the maximum. The 2018 Relative TSR RSUs would have vested slightly above target; however, NRE’s compounded annual TSR during the performance period through the date of the merger agreement exceeded 200% of the compounded annual TSR of the MSCI US REIT Index during the same time period, which would have resulted in these RSUs vesting at maximum if this level of performance had continued through the end of the performance period. In part based on this performance and as permitted by the merger agreement, the compensation committee of the NRE board has approved vesting of all of the RSUs held by NRE’s executive officers and management directors and director nominees at the maximum level in connection with the mergers.

Pro Rata Annual Bonuses

The merger agreement permits NRE to pay cash bonuses at an aggregate annual rate equal to $2.5 million, which will be prorated or annualized, as applicable, depending on the closing date, by multiplying such amount by a fraction equal to (i) the number of days from and including January 1, 2019 to and including the closing date of the merger, divided by (ii) 365. The compensation committee of the NRE board has approved using this amount to pay pro rata cash amounts in connection with the closing of the mergers to NRE’s executive officers and certain other persons providing services to NRE based upon target equity bonus amounts for 2019.

The table below sets forth the target equity bonus amount for each of NRE’s executive officer for 2019 and the pro rata amount that would be paid to each NRE executive officer assuming that the mergers close on September 30, 2019.

Potential Severance Payments and Benefits for NRE Executive Officers

Each of NRE’s executive officers will be entitled to receive cash severance payments from the external manager of NRE or one of its affiliates if his employment is terminated in certain circumstances in connection with the mergers.

Mr. Nia has an employment agreement with an affiliate of the external manager of NRE pursuant to which he is entitled to receive severance payments and benefits in specified circumstances, including if Mr. Nia terminates his employment for “good reason” or his employer terminates his employment without “cause”, in each case, as such terms are defined in the employment agreement. The closing of the mergers will entitle Mr. Nia to terminate his employment for “good reason” under his employment agreement and receive those severance payments and benefits as a result of the termination of the NRE management agreement and other actions that are expected to occur in connection with the closing of the mergers. Upon such a termination, Mr. Nia would be entitled to receive the following from his employer, which is an affiliate of the external manager of NRE: (i) a cash severance payment of approximately $7,732,613, (ii) a pro rata bonus for the year in which the termination occurs based on the actual cash bonus paid for the prior year, which was $833,977 for 2018 and (iii) continuing health benefits for one year or, if earlier, the date upon which Mr. Nia receives similar health benefits from another person. Pursuant to the terms of that certain Employee Transition Agreement, dated April 23, 2019, by and among NRE, the external manager of NRE and an affiliate of the external manager of NRE, which we refer to as the employee transition agreement, in the context of the mergers, affiliates of the external manager of NRE will be solely responsible for all cash severance payments payable to Mr. Nia and the payment of such cash severance is to be made concurrently with, or prior to, the receipt by the external manager of NRE of the termination fee payable in connection with the termination of the NRE management agreement and upon the closing of the mergers.

68

Pursuant to the employee transition agreement, the external manager of NRE agreed that either it or one of its affiliates would pay cash severance and a pro rata annual bonus to each of Keith A. Feldman, Chief Financial Officer and Treasurer of NRE, and Trevor K. Ross, Executive Vice President, General Counsel and Secretary of NRE, among others, in specified circumstances. These amounts will be owed in the event of a qualifying termination of employment by the external manager of NRE or one of its affiliates that occurs prior to the closing of the mergers or within nine months after the termination of the NRE management agreement upon the closing of the mergers. The minimum amount of cash severance payable would be determined based on a formula tied to years of service and base salary, which currently would amount to approximately $295,000 and $112,000 for Messrs. Feldman and Ross, respectively. The pro rata bonus would be based on minimum annual bonus amounts of $554,400 and $195,048 for Messrs. Feldman and Ross, respectively, and would be prorated based on the number of days worked in the year of termination and the prior year if bonuses for such year had not been paid.

Accelerated Vesting of Outstanding Equity Awards of Colony and Colony Credit Real Estate

Pursuant to provisions of the employee transition agreement, Colony and Colony Credit Real Estate agreed to amend the terms of outstanding equity awards previously made to NRE’s executive officers to provide for accelerated vesting upon a change in control of NRE, with minimum vesting of 100% of target for performance-based equity awards. Accordingly, the vesting of these equity awards held by NRE’s executive officers will be accelerated upon the consummation of the mergers.

The table below sets forth the number of outstanding, unvested shares of common stock or restricted stock units representing the right to receive an equal number of shares of common stock of Colony and Colony Credit Real Estate held by NRE’s executive officers as of the date hereof. As of [—], the closing prices of shares of common stock of Colony and Colony Credit Real Estate were $[—] and $[—], respectively.

Directors’ and Officers’ Insurance and Indemnification

In connection with the mergers, NRE’s directors and officers will receive certain insurance and indemnification under the merger agreement. For specific terms, see the section entitled “The Merger Agreement—Indemnification; Directors’ and Officers’ Insurance” beginning on page [—] of this proxy statement.

Material U.S. Federal Income Tax Consequences of the Mergers

The following is a summary of the material U.S. federal income tax consequences of the merger to holders of NRE common stock whose shares of common stock are surrendered in the merger in exchange for the per share consideration. The statements in this section are not intended to be, and should not be construed as, tax advice. The statements in this section are based on the Code; final, temporary and proposed Treasury regulations; the legislative history of the Code; current administrative interpretations and practices of the Internal Revenue Service, which we refer to as the IRS; and court decisions. The reference to IRS interpretations and practices includes the IRS practices and policies endorsed in private letter rulings, which are not binding on the IRS except with respect to the taxpayer that receives the ruling. In each case, these sources are relied upon as they exist on the date of this discussion. Future legislation, Treasury regulations, administrative interpretations and court decisions could change the current law or adversely affect existing interpretations of current law on which the information in this section is based. Any such change could apply retroactively. NRE has not requested, and does

69

not plan to request, any rulings from the IRS concerning the tax treatment of the merger. Accordingly, even if there is no change in the applicable law, no assurance can be provided that the statements made in the following discussion, which do not bind the IRS or the courts, will not be challenged by the IRS or will be sustained by a court if so challenged.

This summary assumes that NRE common stock is held as a “capital asset” within the meaning of Section 1221 of the Code and does not address all aspects of taxation that may be relevant to particular stockholders in light of their personal circumstances. This summary does not address (i) U.S. federal taxes other than income taxes, (ii) state, local or non-U.S. taxes, or (iii) tax reporting requirements, in each case as applicable to the merger. In addition, this summary does not address the tax treatment of certain types of stockholders that are subject to special treatment under the U.S. federal income tax laws, such as:

If a partnership, entity or arrangement treated as a partnership for U.S. federal income tax purposes holds NRE common stock, the U.S. federal income tax treatment of a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. If you are a partner in a partnership holding NRE common stock, you should consult your tax advisor regarding the consequences to you of the merger.

For purposes of this section, a “U.S. stockholder” means a beneficial owner of NRE common stock that is, for U.S. federal income tax purposes:

70

As used in this section, a “non-U.S. stockholder” means a beneficial owner of NRE common stock that is not a U.S. stockholder, a partnership (or entity treated as a partnership for U.S. federal income tax purposes) or a tax-exempt stockholder.

THE U.S. FEDERAL INCOME TAX TREATMENT OF THE MERGER AND OF HOLDERS OF NRE COMMON STOCK DEPENDS IN SOME INSTANCES ON DETERMINATIONS OF FACT AND INTERPRETATIONS OF COMPLEX PROVISIONS OF U.S. FEDERAL INCOME TAX LAW FOR WHICH NO CLEAR PRECEDENT OR AUTHORITY MAY BE AVAILABLE. YOU ARE URGED TO CONSULT YOUR TAX ADVISOR REGARDING THE U.S. FEDERAL, STATE AND LOCAL AND NON-U.S. INCOME AND OTHER TAX CONSEQUENCES TO YOU OF THE MERGER IN LIGHT OF YOUR PARTICULAR INVESTMENT OR TAX CIRCUMSTANCES.

Consequences of the Merger to NRE

For U.S. federal income tax purposes, NRE intends to treat the merger as if it had sold all of its assets to Merger Sub in exchange for the merger consideration and then made a liquidating distribution of the merger consideration to the NRE stockholders in exchange for their NRE common stock. As a REIT, NRE generally is entitled to receive a deduction for liquidating distributions. NRE anticipates that its deemed liquidating distribution in connection with the merger will exceed its taxable income recognized as a result of the merger (together with any other undistributed taxable income recognized in the taxable year of the merger). Accordingly, NRE anticipates that it will not be subject to U.S. federal income or excise tax on any gain recognized (or deemed recognized) in connection with the merger and the other transactions contemplated by the merger agreement.

Consequences of the Merger to U.S. Stockholders of NRE Common Stock

General

A U.S. stockholder’s receipt of cash in exchange for NRE common stock will be treated as a taxable sale for U.S. federal income tax purposes. In general, a U.S. stockholder of NRE common stock will recognize gain or loss for U.S. federal income tax purposes equal to the difference between:

Gain or loss will be calculated separately for each block of NRE common stock, with a block consisting of multiple shares of NRE common stock acquired at the same cost in a single transaction. Generally, any gain or loss recognized will be capital gain or loss and will be long-term capital gain or loss if, at the time of the merger, the U.S. stockholder has held the related common stock for more than one year. An individual U.S. stockholder will be subject to tax on net long-term capital gain at a maximum U.S. federal income tax rate of 20%. Additionally, a 3.8% Medicare unearned income contribution tax will apply to any gain recognized by individuals, trusts and estates whose income exceeds certain threshold levels. Capital gains of corporate U.S. stockholders generally are taxable at the regular U.S. federal income tax rates applicable to corporations (currently 21%). The deductibility of capital losses is subject to limitations under the Code. In addition, the IRS has the authority to prescribe, but has not yet prescribed, Treasury Regulations that would apply a tax rate of 25% to a portion of long-term capital gain realized by a non-corporate stockholder on the sale of REIT shares that would correspond to the REIT’s “unrecaptured Section 1250 gain”.

71

Special Rule for U.S. Stockholders Who Have Held NRE Common Stock for Less than Six Months

A U.S. stockholder who has held NRE common stock for less than six months at the effective time of the merger, taking into account the holding period rules of Sections 246(c)(3) and (4) of the Code, and who recognizes a loss on the exchange of NRE common stock in the merger, will be treated as recognizing a long-term capital loss to the extent of any capital gain dividends previously received from NRE, or such U.S. stockholder’s share of any previously designated retained capital gains, with respect to such common stock.

Consequences of the Merger to Non-U.S. Stockholders of NRE Common Stock

A non-U.S. stockholder’s gain or loss from the merger will be determined in the same manner as that of a U.S. stockholder. Subject to the discussion of backup withholding described below, a non-U.S. stockholder generally will not be subject to U.S. federal income tax or U.S. federal withholding tax on any gain recognized from the merger, unless: (i) such non-U.S. stockholder’s common stock is treated as being effectively connected with a U.S. trade or business of such non-U.S. stockholder (and, if a tax treaty applies, is attributable to a U.S. permanent establishment maintained by the non-U.S. stockholder); or (ii) such non-U.S. stockholder is a non-resident alien individual who has been present in the United States for 183 days or more during the taxable year of the merger and certain other conditions are met.

A non-U.S. stockholder whose gain is effectively connected with the conduct of a trade or business in the United States of such non-U.S. stockholder will be subject to U.S. federal income tax on such gain on a net basis in the same manner as a U.S. stockholder. In addition, a non-U.S. stockholder that is a corporation may be subject to a 30% branch profits tax (or lower applicable treaty rate) on such effectively connected gain.

A non-U.S. stockholder who is an individual who has been present in the United States for 183 days or more during the taxable year of the merger and who meets certain other requirements will be subject to a flat 30% tax on the non-U.S. stockholder’s capital gain from the merger, which may be offset by U.S.-source capital losses of such non-U.S. stockholder. In addition, the non-U.S. stockholder may be subject to applicable alternative minimum taxes.

If a non-U.S. stockholder is eligible for treaty benefits under an income tax treaty with the United States, the non-U.S. stockholder may be able to reduce or eliminate certain of the U.S. federal income tax consequences discussed above, such as the branch profits tax. Non-U.S. stockholders should consult their tax advisors regarding possible relief under an applicable income tax treaty.

The rules governing the U.S. federal income tax consequences of the receipt of the merger consideration are complex. Non-U.S. stockholders should consult with their tax advisors to determine the U.S. federal income tax consequences of the merger to them, as well as the applicability and impact of any U.S. tax laws other than those pertaining to income tax, as well as any state, local and non-U.S. tax laws.

Information Reporting and Backup Withholding

Backup withholding, currently at a rate of 24%, and information reporting may apply to the cash received pursuant to the exchange of NRE common stock in the merger. Backup withholding will not apply, however, to a holder who:

72

Backup withholding is not an additional tax and any amounts withheld under these rules may be allowed as a credit or refund against the stockholder’s U.S. federal income tax liability provided the required information is timely furnished to the IRS.

THE FOREGOING DISCUSSION OF THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER IS FOR GENERAL INFORMATION PURPOSES ONLY AND IS NOT INTENDED TO CONSTITUTE A COMPLETE DESCRIPTION OF ALL TAX CONSEQUENCES RELATING TO THE MERGER. TAX MATTERS ARE VERY COMPLICATED, AND THE TAX CONSEQUENCES OF THE MERGER TO YOU WILL DEPEND UPON THE FACTS OF YOUR PARTICULAR SITUATION. BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, STOCKHOLDERS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE APPLICABILITY OF THE RULES DISCUSSED ABOVE AND THE PARTICULAR TAX EFFECTS OF THE MERGER TO THEIR SITUATION, INCLUDING THE APPLICATION OF STATE, LOCAL AND NON-U.S. TAX LAWS.

Regulatory Approvals

The completion of the mergers is subject to the receipt of the merger control clearance from the German FCO required as a result of acquisition of NRE by Parent. Parent and NRE have filed a merger notification with the German FCO pursuant to Sec. 39 Para. 1 GWB in respect of the German Competition Merger Control Provisions on July 29, 2019.

73

THE MERGER AGREEMENT

This section describes the material terms of the merger agreement. The description of the merger agreement in this section and elsewhere in this proxy statement is qualified in its entirety by reference to the complete text of the merger agreement, a copy of which is attached as Annex A to, and is incorporated by reference into, this proxy statement. This summary does not purport to be complete and does not contain all of the information about the merger agreement that may be important to you. We encourage you to read the merger agreement carefully and in its entirety as it is the legal document governing the merger.

Explanatory Note Regarding the Merger Agreement

The merger agreement and this summary of its terms are included to provide you with information regarding its terms. Factual disclosures about NRE contained in this proxy statement or in NRE’s public reports filed with the SEC may supplement, update or modify the factual disclosures about NRE contained in the merger agreement. The representations, warranties and covenants made in the merger agreement by NRE, the Partnership, Partnership Merger Sub, Parent and Merger Sub were made solely to the parties to, and solely for the purposes of, the merger agreement and as of specific dates and were qualified and subject to important limitations agreed to by the parties in connection with negotiating the terms of the merger agreement. In particular, in your review of the representations and warranties contained in the merger agreement and described in this summary, it is important to bear in mind that the representations and warranties were negotiated with the principal purposes of establishing the circumstances in which a party to the merger agreement may have the right not to consummate the mergers if the representations and warranties of the other party prove to be untrue due to a change in circumstance or otherwise, and allocating risk between the parties to the merger agreement, rather than establishing matters as facts. The representations and warranties may also be subject to a contractual standard of materiality different from those generally applicable to stockholders and reports and documents filed with the SEC and in some cases were qualified by the matters contained in the NRE disclosure letter, which disclosures were not reflected in the merger agreement. Moreover, information concerning the subject matter of the representations and warranties may have changed since the date of the merger agreement. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts of by NRE, the Partnership, Partnership Merger Sub, Parent or Merger Sub or any of their respective subsidiaries or affiliates.

Effects of the Mergers; Member and Constituent Documents of the Surviving Entity

The merger agreement provides for the merger of NRE with and into Merger Sub, with Merger Sub as the Surviving Entity, upon the terms, and subject to the conditions, set forth in the merger agreement. Immediately prior to and in connection with the merger, Partnership Merger Sub will merge with and into the Partnership, with the Partnership as the Surviving Partnership. At the effective time of the merger, the separate corporate existence of NRE will cease. As the Surviving Entity, Merger Sub will continue to exist as a Maryland limited liability company following the mergers. As a result of the mergers, the Surviving Entity will be a wholly-owned subsidiary of Parent.

The merger agreement provides that, upon the consummation of the mergers, Parent shall be the sole member of the Surviving Entity and will be entitled to such rights, duties and obligations as more fully set forth in the operating agreement of the Surviving Entity.

The articles of organization and operating agreement of Merger Sub, each as in effect immediately prior to the effective time of the merger, will be the articles of organization and the operating agreement of the Surviving Entity until either is amended in accordance with its respective terms and applicable laws.

Closing and Effective Time of the Mergers

The mergers will occur only if the closing conditions contained in the merger agreement are satisfied or waived. The merger will be completed legally at the time the articles of merger have been duly filed with and

74

accepted for record by the State Department of Assessments and Taxation of Maryland or at such other date and time as may be agreed by the parties and specified in the articles of merger (which may not be more than 30 days after the articles of merger have been accepted for record). The partnership merger will be completed legally at the time the certificate of merger is filed with the Secretary of State of the State of Delaware or on such other date and time as may be agreed by the parties and specified in the certificate of merger, which nonetheless shall be immediately before the effective time of the merger.

Subject to the fulfillment or waiver of the conditions to the mergers, the mergers are expected to be completed in the fourth quarter of 2019. However, there can be no assurance as to when or if the mergers or the other transactions contemplated by the merger agreement will occur.

Treatment of NRE Common Stock and Equity Awards

NRE Common Stock

At the effective time of the merger, each share of NRE common stock issued and outstanding immediately prior to such time (other than cancelled shares) will be converted automatically into the right to receive cash in an amount equal to the per share consideration, without interest. At the effective time of the merger, such shares of NRE common stock that have been converted into the right to receive the per share consideration shall no longer be outstanding and will be cancelled automatically and will cease to exist. At the effective time of the merger, cancelled shares will be cancelled without payment of any consideration for such shares, will cease to be outstanding and will cease to exist. Subject to certain exceptions set forth in the merger agreement (including NRE’s ability to pay the regular quarterly dividend for the fiscal quarter ended June 30, 2019 as described more fully in the section entitled “—Conduct of NRE’s Business Pending the Mergers” beginning on page [—] of this proxy statement), if NRE declares, sets aside or makes or pays any cash dividends or distributions on NRE common stock (whether to maintain NRE’s qualification as a REIT under the Code or otherwise), the per share consideration will be reduced by an amount equal to the per share amount of such dividend or distribution.

Restricted Shares of NRE Common Stock

At the effective time of the merger, any vesting conditions applicable to each outstanding restricted share of NRE common stock granted under NRE’s equity incentive plan will, automatically and without any action required on the part of the holder thereof, accelerate in full and each restricted share of NRE common stock will be converted automatically into the right to receive cash in an amount equal to the per share consideration, without interest and less any applicable withholding taxes.

Performance-Based Restricted Stock Units

Immediately prior to the effective time of the merger, any vesting conditions applicable to each outstanding RSU granted under NRE’s equity incentive plan will be treated in accordance with the terms set forth in the applicable award agreement; provided that the compensation committee of the NRE board may, in its sole discretion, cause these awards to be earned and vested at levels reflecting achievement of the applicable performance-based vesting conditions at the maximum level. At the effective time of the merger, all earned and vested RSUs will automatically and without any action required on the part of the holder thereof, be cancelled, and Parent will cause the Surviving Entity to pay each former holder of such cancelled RSUs cash in an amount equal to the per share consideration (plus any amount owed with respect to past dividends in accordance with the terms set forth in the applicable award agreement), without interest and less any applicable withholding taxes. Any RSU that does not become earned and vested will terminate without consideration immediately prior to the effective time of the merger.

75

Treatment of Interests in the Partnership

Limited Partnership Interests

At the effective time of the partnership merger, each common unit (other than common units of the Partnership held by NRE or its subsidiaries immediately prior to the effective time of the partnership merger) and each LTIP unit issued and outstanding immediately prior to the effective time of the partnership merger will be converted automatically into the right to receive cash in an amount equal to the per share consideration, without interest. Each common unit of the Partnership held by NRE immediately prior to the effective time of the partnership merger will be unaffected by the partnership merger and will remain outstanding as common units of the Surviving Partnership held by the Surviving Entity. This proxy statement does not constitute any solicitation of consents in respect of the partnership merger.

General Partnership Interests

The general partnership interest in the Partnership held by NRE immediately prior to the effective time of the partnership merger will be unaffected by the partnership merger and will remain outstanding as a general partnership interest in the Surviving Partnership held by the Surviving Entity. Immediately following the effective time of the merger, by virtue of the merger, Merger Sub will be the general partner and sole limited partner of the Surviving Partnership.

Exchange and Payment Procedures

Prior to the effective time of the merger and the partnership merger, Parent or Merger Sub shall enter into an agreement in form and substance reasonably acceptable to NRE with a paying agent selected by Parent with NRE’s prior approval, which approval will not be unreasonably withheld, delayed or conditioned, for the payment of the merger consideration to NRE stockholders and payments to the holders of common units and LTIP units.

At or prior to the effective time of the merger, Parent shall deposit, or cause to be deposited, with DB AG London a cash amount in U.S. dollars, Euros and pounds sterling, that, when taken together with the available cash of NRE and its subsidiaries that is deposited with DB AG London at the effective time of the merger and partnership merger, is sufficient in the aggregate for the paying agent to make the payments of the merger consideration to NRE stockholders and payments to holders of common units and LTIP units, which we refer to as the exchange fund, as provided for in the merger agreement.

The U.S. dollar, Euro and pound sterling components of the funds deposited with DB AG London will be consistent with the relative portions of the per share consideration that are denominated in U.S. dollars, Euros and pounds sterling. In accordance with the hedging agreements entered into by NRE, Parent and NRE will cause DB AG London to convert the Euro and pound sterling components of the exchange fund into U.S. dollars. Any outstanding hedges relating to the mergers must be unwound prior to the effective time of the merger and mark-to-market present valued and settled net against the U.S. dollars being delivered to the exchange fund. Immediately following such conversion and at or prior to the effective time of the merger, Parent and NRE will cause DB AG London to deposit the exchange fund with the paying agent, in trust for the benefit of the holders of NRE common stock (other than cancelled shares and restricted shares of NRE common stock), common units and LTIP units outstanding immediately prior to the effective time of the merger or the partnership merger, as applicable.

Promptly after the effective time of the merger (and in any event within five business days thereafter), Parent and the Surviving Entity shall cause the paying agent to mail or otherwise provide to each holder of record of NRE common stock (other than cancelled shares and restricted shares of NRE common stock), common units or LTIP units:

76

Each NRE share certificate, book-entry share, common unit and LTIP unit shall be deemed at any time after the closing date to represent only the right to receive (with respect to each NRE share certificate, upon delivery thereof, with respect to each book-entry share, upon receipt by the paying agent of an “agent’s message” in customary form, and with respect to common units and LTIP units, upon receipt by the paying agent of a transfer form acceptable to the paying agent) the per share consideration. All payments made with respect to the merger consideration will be paid without interest. The per share consideration paid or delivered upon the surrender of NRE share certificates, book-entry shares, common units and LTIP units shall be deemed to have been paid or delivered, as the case may be, in full satisfaction of all rights and privileges pertaining to the shares of NRE common stock, common units and LTIP units represented thereby or exchanged therefor.

In the event of a transfer of ownership of shares of NRE common stock that is not registered in the transfer records of NRE or if payment of any portion of the merger consideration is to be made to a person other than the person in whose name the delivered NRE share certificate or the surrendered book-entry share is registered, the merger agreement provides that, upon due delivery of the NRE share certificate or due surrender of the book-entry share, payment of such portion of the merger consideration may be issued to such transferee or other person if the NRE share certificate or book-entry share formerly representing such shares of NRE common stock is properly presented to the paying agent accompanied by all documents required to evidence and effect such transfer and to establish to the reasonable satisfaction of the Surviving Entity that any applicable transfer or other similar taxes have been paid or are not applicable.

Any portion of the exchange fund (including the proceeds of any investments thereof) that remains unclaimed by the former holders of NRE common stock, common units or LTIP units for 18 months after the effective time of the merger will be delivered to the Surviving Entity (or its designee) upon demand. Thereafter, any such holders of shares of NRE common stock, common units or LTIP units will be entitled to look only to the Surviving Entity for payment of the portion of the merger consideration or payments to holders of common units or LTIP units payable in respect thereof. None of the Surviving Entity, Parent, NRE, the Surviving Partnership, the paying agent or any other person will be liable to any former holder of shares of NRE common stock, common units or LTIP units for any amount delivered to a public official pursuant to applicable abandoned property, escheat or other similar laws.

From and after the effective time of the merger, the stock transfer books of NRE and the partnership interest records of the Partnership will be closed and there will be no transfers on the stock transfer books of the Surviving Entity or the records of the Partnership of NRE common stock, common units or LTIP units that were outstanding immediately prior to the effective time of the merger or the partnership merger, as applicable. If, after the effective time of the merger, any NRE share certificate or acceptable evidence of a book-entry share is presented to the Surviving Entity or the paying agent for transfer, it will be cancelled and exchanged for the portion of the merger consideration to which the holder of such share is entitled pursuant to the merger agreement (without interest). The portion of the merger consideration, without interest, paid or delivered upon the surrender for exchange of NRE share certificates or book-entry shares will be deemed to have been paid or delivered, as the case may be, in full satisfaction of all rights and privileges pertaining to the shares of NRE common stock represented thereby or exchanged therefor.

77

Each of Parent, Merger Sub, NRE, the Surviving Entity, the Partnership, the Surviving Partnership, or any affiliate thereof, or the paying agent, as the case may be, will be entitled to deduct or withhold, or cause to be deducted or withheld, from any amounts otherwise payable pursuant to the merger agreement to any person such amount as is required to deduct and withhold with respect to the making of such payment under applicable law (including, but not limited to, Section 1445 of the Code), and the rules and regulations promulgated thereunder, or any provision of state, local or foreign law. To the extent that amounts are so deducted and withheld by the applicable payor in respect of any person and remitted to the appropriate governmental authority, such amounts will be treated for all purposes of the merger agreement as having been paid to such person in respect of which such deduction and withholding was made.

Appraisal Rights

Pursuant to NRE’s charter and as permitted under Maryland law, no dissenters’ or appraisal rights are available to stockholders in connection with the mergers or the other transactions contemplated by the merger agreement.

Representations and Warranties

Representations and Warranties of NRE, the Partnership and Partnership Merger Sub

The merger agreement contains customary representations and warranties made by NRE, the Partnership and Partnership Merger Sub to Parent and Merger Sub that are subject, in some cases, to specified exceptions and qualifications contained in the merger agreement, in the NRE disclosure letter or in certain reports filed by NRE with the SEC. In particular, certain of these representations and warranties are subject to materiality or “material adverse effect” qualifications (that is, they will not be deemed to be untrue or incorrect unless their failure to be true or correct is material or would result in a material adverse effect on NRE, as further described in the section entitled “––Representations and Warranties––Material Adverse Effect” beginning on page [—] of this proxy statement). In addition, certain of the representations and warranties in the merger agreement are subject to knowledge qualifications, which means that those representations and warranties would not be deemed untrue, inaccurate or incorrect if certain officers of NRE did not have actual knowledge after reasonable inquiry of such representations being untrue, inaccurate or incomplete.

In the merger agreement, NRE, the Partnership and Partnership Merger Sub, jointly and severally, made representations and warranties to Parent and Merger Sub regarding, among other things:

78

79

Material Adverse Effect

Many of the representations and warranties of NRE, the Partnership and Partnership Merger Sub in the merger agreement are qualified by, among other things, exceptions relating to the absence of a “material adverse effect”, which means any effect, change, event, occurrence, circumstance or development (each of which we refer to as a Change) that, individually or in the aggregate with other effects, changes, events, occurrences, circumstances or developments, taken as a whole, has had or would reasonably be expected to have a material adverse effect on the financial condition, results of operations, business or assets of NRE and its subsidiaries, taken as a whole, or the ability of NRE to timely consummate the transactions contemplated by the merger agreement prior to December 15, 2019 (or, if applicable, March 1, 2020), but excluding any Change to the extent resulting from:

except, with respect to the first, second, third, fourth, seventh and eighth bullet points above, to the extent that NRE and its subsidiaries, taken as a whole, are disproportionately adversely affected by such Change as compared to other participants in the real estate industry that own similar assets in jurisdictions in which NRE or any of its subsidiaries own assets.

80

Representations and Warranties of Parent and Merger Sub

The merger agreement also contains customary representations and warranties made by Parent and Merger Sub to NRE, the Partnership and Partnership Merger Sub that are subject, in some cases, to specified exceptions and qualifications contained in the merger agreement or in the disclosure letter that Parent and Merger Sub delivered to NRE in connection with the merger agreement. In particular, certain of these representations and warranties are subject to materiality or “material adverse effect” qualifications (that is, they will not be deemed to be untrue or incorrect unless their failure to be true or correct is material or would result in a material adverse effect on Parent or Merger Sub, as applicable). In addition, certain of these representations and warranties are subject to knowledge qualifications, which means that those representations and warranties would not be deemed untrue or incorrect if certain officers of Parent and Merger Sub did not have actual knowledge after reasonable inquiry of such representations being untrue or incorrect.

The representations and warranties of Parent and Merger Sub relate to, among other things:

The representations and warranties in the merger agreement of NRE, the Partnership and Partnership Merger Sub and Parent and Merger Sub will not survive the effective time of the merger.

81

Conduct of NRE’s Business Pending the Mergers

Under the merger agreement, NRE has agreed to certain restrictions on the operation of its business until the earlier of the effective time of the merger and the termination of the merger agreement. In general, NRE and its subsidiaries will use commercially reasonable efforts to conduct their businesses in the ordinary course of business consistent with NRE’s operating budget and past practice in all material respects and will maintain and preserve intact their respective current business organizations, preserve their assets and properties in good repair and condition (normal wear and tear excepted), preserve the goodwill and current relationships of the NRE and its subsidiaries with persons with which they have significant business relationships and maintain their material rights and authorizations.

Without limiting the foregoing, except as specifically disclosed in the NRE disclosure letter, as contemplated or required by the merger agreement or as required by applicable law or by any governmental authority, NRE will not, and will not permit any of its subsidiaries to do any of the following without the prior written consent of Parent (which consent will not be unreasonably withheld, conditioned or delayed:

82

83

84

The merger agreement is not intended to give any of the parties to the merger agreement, directly or indirectly, the right to control or direct another party’s operations prior to the effective time of the merger. Prior to the effective time of the merger, each party will exercise, consistent with the terms and conditions of the merger agreement, complete control and supervision over their respective operations.

Non-Solicitation of Acquisition Proposals

From the date of the merger agreement until the earlier of the termination of the merger agreement and the effective time of the merger, NRE is subject to restrictions on its ability to solicit third-party proposals relating to alternative transactions or to provide information to and engage in discussions or negotiations with a third-party in relation to an alternative transaction (subject to certain exceptions prior to the time the NRE stockholder approval is obtained as described further below). Specifically, NRE and its subsidiaries and their respective officers and directors may not, and NRE must use its reasonable best efforts to cause its and its subsidiaries’ agents, advisors and affiliates, not to, directly or indirectly:

85

Under the merger agreement, an acquisition proposal means any proposal or offer from any person (other than Parent and its subsidiaries) relating to, in a single transaction or series of transactions, involving (i) a merger, consolidation, dissolution, liquidation, recapitalization, share exchange, business combination, reorganization, sale of assets, equity investment, joint venture or similar transaction involving NRE as a result of which NRE stockholders immediately prior to such transaction would cease to own at least 80% of the total voting power of NRE or any surviving entity immediately following such transaction, (ii) the direct or indirect acquisition by any person or group of persons of more than 20% of the voting securities in NRE or more than 20% of the equity interests or general partner interests in the Partnership, including through a tender offer or exchange offer or other transaction, or (iii) the acquisition in any manner, directly or indirectly, of more than 20% of the fair market value of the consolidated assets, or assets generating more than 20% of the consolidated net revenue or consolidated net income of NRE and its subsidiaries in the aggregate.

Fiduciary Exception

Notwithstanding the foregoing restrictions, prior to the time the NRE stockholder approval is obtained, NRE may, after providing notice to Parent:

in each case, if and only to the extent that, prior to taking such action, the SRC:

Promptly (and, in any event, within 24 hours) after providing any non-public information to such person, NRE will make such non-public information available to Parent to the extent not previously provided to Parent.

86

Under the merger agreement, a superior proposal means a bona fide written acquisition proposal that the SRC has determined in its good faith judgment is reasonably likely to be consummated in accordance with its terms, taking into account all legal, financial and regulatory aspects of the proposal and the person(s) making the proposal and, if consummated, would be reasonably expected to result in a transaction that is more favorable to NRE stockholders from a financial point of view than the transactions contemplated by the merger agreement (after taking into account any revisions to the terms of the transaction pursuant to the terms of the merger agreement and the time likely to be required to consummate such acquisition proposal). Solely with respect to the definition of “superior proposal”, all of the references to 20% and 80% included in the definition of “acquisition proposal” will be deemed to be references to 50%.

Existing Discussions

NRE agreed, upon execution of the merger agreement, to immediately cease and cause to be terminated all discussions, negotiations, solicitation or encouragement with any parties that may be ongoing with respect to an acquisition proposal as of the date of the merger agreement.

Notice

NRE will promptly (and, in any event, within 24 hours) notify Parent in writing (i) if any acquisition proposal is received by, or any discussions or negotiations are sought to be initiated regarding an acquisition proposal with, NRE or any of its representatives indicating, in connection with such notice, the name of such person and the material terms and conditions of any acquisition proposal (including, if applicable, copies of any written requests, proposals or offers, including proposed agreements), and (ii) if NRE provides non-public information to any person. Thereafter, NRE will keep Parent informed, on a reasonably current basis, of the status and terms of any such acquisition proposal (including any amendments to an acquisition proposal) and the status of any such discussions or negotiations, including by providing a copy of all written proposals, offer or drafts of proposed agreements.

No Change in Board Recommendation; Alternative Acquisition Agreements and Intervening Events

No Change in Board Recommendation

In the merger agreement, the SRC and the NRE board agreed to recommend that NRE stockholders vote in favor of the approval of the merger. Subject to certain exceptions described below, the NRE board and each committee of the NRE board (including the SRC) may not:

87

Alternative Acquisition Agreement; Intervening Event

Prior to the time that the NRE stockholder approval is obtained and so long as NRE is not in material breach of the non-solicitation obligations under the merger agreement, the NRE board or the SRC, as applicable, may make a change of recommendation in response to a superior proposal that was not withdrawn at the time of the change of recommendation or terminate, and cause or permit NRE to terminate, the merger agreement for the purpose of entering into an alternative acquisition agreement with respect to such superior proposal (subject to paying the required company termination fee to Parent with respect to such termination, as described in the sections entitled “—Termination Payments” and “—Expenses” beginning on pages [—] and [—] of this proxy statement, respectively), in each case if the SRC determines in good faith, after consultation with its financial advisors that such acquisition proposal constitutes a superior proposal, and determines in good faith, after consultation with its outside legal counsel, that the failure to take such action would reasonably be expected to be inconsistent with each director’s duties under applicable law. However, NRE, the NRE board and the SRC may not take any such actions unless:

Prior to the time that the NRE stockholder approval is obtained, the SRC or the NRE board may make a change of recommendation solely in response to an intervening event (as defined below) if the SRC determines in good faith, after consultation with its outside legal counsel, that the failure to make a change of recommendation in response to such intervening event would be inconsistent with each director’s duties under applicable law. However, the SRC and the NRE board may not take any such action unless:

Under the merger agreement, an intervening event means any fact, circumstance, change, event, occurrence or effect that is material to NRE and its subsidiaries, taken as a whole (other than any event or circumstances

88

resulting from a breach of the merger agreement by NRE), and that occurred or arose after the date of the merger agreement and that was not known by, nor reasonably foreseeable to, the NRE board or the SRC as of or prior to the date of the merger agreement and does not involve or relate to an acquisition proposal. The merger agreement expressly provides that none of the following will constitute, or be considered in determining whether there has been, an intervening event: (i) changes, in and of itself, in the market price or trading volume of NRE common stock; (ii) the fact that, in and of itself, NRE meets or exceeds internal or public projections or forecasts or estimates of revenues, earnings or other financial results for any period; or (iii) the timing of any required regulatory approvals related to the mergers (provided that, with respect to (i) and (ii), the underlying reasons for these changes may constitute an intervening event).

Certain Permitted Disclosure

Nothing in the merger agreement will prevent NRE, the SRC or the NRE board from complying with Rule 14d-9 and Rule 14e-2 under the Exchange Act or otherwise complying with its disclosure obligations under applicable law with regard to an acquisition proposal; provided that if such disclosure has the effect of withdrawing or adversely modifying the SRC and/or the NRE board’s recommendation to vote in favor of approving the merger proposal, such disclosure will be made in compliance with the merger agreement provisions described above.

Stockholders Meeting

Pursuant to the merger agreement, as promptly as practicable following confirmation by the SEC that the SEC has no further comments to this proxy statement, NRE has agreed to take all action necessary to promptly and duly call, give notice of, convene and hold as promptly as practicable a stockholder meeting for the purpose of obtaining the requisite stockholder vote to approve the merger proposal. Unless a permitted change in the recommendation of the NRE board to approve the merger proposal has occurred as described above in the section entitled “—No Change in Board Recommendation; Alternative Acquisition Agreements and Intervening Events”, NRE has agreed to use its commercially reasonable efforts to solicit the requisite stockholder vote for approval, including by soliciting proxies from NRE stockholders.

Actions

General Obligations

As a general matter, each party to the merger agreement will cooperate fully with, and furnish information to, the other parties and use its reasonable best efforts to take or cause to be taken, in good faith, all actions and to do or cause to be done all things necessary, proper or desirable, or advisable under applicable laws, so as to permit consummation of the mergers as promptly as practicable and otherwise to enable consummation of the transactions contemplated by the merger agreement, including preparing and filing as promptly as possible all documentation to effect all necessary permits, consents, approvals and authorizations necessary or advisable to be obtained from any third party or any governmental entity in order to consummate the mergers or any of the other transactions contemplated by the merger agreement (and with respect to any required regulatory approvals from governmental entities, the parties have agreed to make appropriate filings within 15 business days of signing the merger agreement).

Competition Approval

Each party to the merger agreement must make appropriate filings in the relevant jurisdiction with respect to the transactions contemplated by the merger agreement as promptly as practicable and to supply as promptly as practicable any additional information and documentary material that may be requested from an antitrust authority in the relevant jurisdiction and to take any and all other actions reasonably necessary to satisfy the merger clearance condition under the merger agreement as soon as practicable.

89

Financing

Debt Financing and Cooperation

Prior to the closing date, upon the request of NRE, Parent will keep NRE reasonably informed in reasonable detail of the status of its efforts to arrange debt financing, which is not a condition to closing. NRE will use its commercially reasonable efforts to provide to Parent and Merger Sub, in each case at Parent’s sole expense, all cooperation reasonably necessary and customary in connection with the arrangement of debt financing, reasonably requested in writing by Parent, including using commercially reasonable efforts to: (i) upon reasonable notice, direct management of NRE and its subsidiaries (including employees of the external manager of NRE) with appropriate seniority and expertise to participate in a reasonable number of meetings and presentations with prospective lenders at reasonable times and locations mutually agreed; (ii) assist with the preparation of materials for bank information memoranda and similar documents reasonably necessary in connection with the debt financing and provide reasonable cooperation with the due diligence efforts of any source of debt financing to the extent reasonable and customary; (iii) furnish Parent and its potential lenders reasonably promptly upon written request with such financial, statistical and other pertinent information and projections relating to NRE and its subsidiaries as reasonably requested by Parent, as is usual and customary for debt financings and reasonably available and prepared in the ordinary course of business; (iv) assist with the preparation of customary definitive loan documentation contemplated by Parent’s debt financing (including schedules), including any customary guarantee, pledge and security documents; (v) provide to Parent upon written request at least 14 business days prior to the closing date, all documentation and other information reasonably requested by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations; (vi) cooperate in connection with the repayment or defeasance of any existing indebtedness of NRE or any of its subsidiaries, and the release of related liens following the repayment in full of such indebtedness, including using commercially reasonable efforts to deliver such customary payoff, defeasance or similar notices under any existing loans of NRE or any of its subsidiaries as are reasonably requested by Parent; and (vii) cooperate with obtaining customary title insurance with respect to each material NRE property as requested by Parent.

The foregoing provisions represent the sole obligation of NRE and its subsidiaries and their respective affiliates with respect to cooperation in connection with debt financing and this obligation will be deemed satisfied for purposes of the closing condition related to NRE’s compliance with its covenants, unless NRE has materially and willfully breached the foregoing obligations, Parent has provided to NRE written notice of such breach within 10 business days of first becoming aware of such breach and NRE fails to cure such breach by 10 business days after notice is provided.

Parent and its representatives may not initiate contact with or pursue potential lenders in connection with the consummation of the transactions contemplated by the merger agreement without (i) the prior written consent of NRE, and (ii) the execution of an agreement binding the potential lender to the same confidentiality, use restrictions and other terms set forth in the confidentiality agreement.

Assumed Indebtedness

Parent has informed NRE that it expects NRE’s mortgage loans to remain outstanding. As of June 30, 2019, NRE had approximately $552 million in aggregate principal amount of consolidated indebtedness under its mortgage loans.

Prior to the date of the merger agreement, NRE had received all of the consents, approvals and waivers, as applicable, relating to certain existing indebtedness of NRE and its subsidiaries, which we refer to as the assumed indebtedness, as are required under the terms of the assumed indebtedness to permit the consummation of the mergers and such assumed indebtedness to be assumed by Parent or its designated affiliate at the effective time of the merger on substantially the same terms and conditions as currently in effect (subject to the terms and conditions set forth in such consents, approvals and waivers, as applicable, including, but not limited to, the

90

execution and delivery of required documentation, the payment of any required fees, costs and expenses and the completion by the lenders of client identification procedures in compliance with applicable money laundering rules (including know your customer procedures (KYC)). In connection with any indebtedness that Parent intends not to repay, NRE and its subsidiaries will reasonably cooperate with Parent, at Parent’s sole cost and expense, in connection with maintaining such continuing indebtedness. In furtherance of the foregoing, at the option of Parent, Parent will have the right to discuss with any such lender maintaining the indebtedness ( provided that NRE is provided a reasonable opportunity to participate in the discussions and Parent will provide NRE with updates on the status of discussions upon NRE’s reasonable request) and make all determinations and decisions regarding such indebtedness from and after the closing date and any payment of costs or fees relating thereto from or after the closing date.

Other Agreements

The merger agreement contains certain other covenants and agreements between the parties, including covenants and agreements relating to:

91

Conditions to the Mergers

Each party’s obligation to consummate the mergers is subject to the fulfillment or written (to the extent permitted by law) waiver of the following conditions: