Interim Management Statement

ISIS Property Trust 2 Limited
01 November 2007


ISIS Property Trust 2 Limited

Interim Management Statement

For the Three Month Period from 1 July 2007 to 30 September 2007


Investment Objective

The investment objective is to provide shareholders with an attractive level of
income together with the potential for capital and income growth from investing
in a diversified UK commercial property portfolio.


Performance Summary

                            For the three
                             month period
                                 ended 30
Total Return *             September 2007


Net asset value per share           -4.9%
Ordinary share price                +0.1%
Investment Property
Databank All Monthly
Valued Funds                        -1.0%
FTSE All Share Index                -1.8%


                                   As at        As at
                            30 September      30 June
Capital Values                      2007         2007          % Change

Net asset value per share         149.9p       159.6p              -6.1
Ordinary share price              123.7p       125.5p              -1.4
FTSE All-Share Index             3,316.9      3,404.1              -2.6
Discount to net asset              17.5%        21.4%
value
Net gearing #                      26.2%        18.3%


Sources: F&C Investment Business Limited, Investment Property Databank ('IPD'),
Datastream.


* - All total returns are based on net dividends re-invested
# - Net gearing: Bank debt (less cash) divided by total assets less current
liabilities




Dividends


The fourth interim dividend for the year ended 30 June 2007 of 1.81 pence per
share was paid on 28 September 2007, giving a total dividend of 7.0 pence per
share for the 2006/7 financial year.


Review for the Period


In a difficult quarter for commercial property, the Company's net asset value
total return was -4.9%. The majority of the negative return can be attributed to
the portfolio performance discussed below, however, a drop in the 10 year swap
rate has reduced the value of the Company's cash flow hedge, and was responsible
for -0.9% of total return. The share price total return was +0.1%, with the
discount reducing from 21.4% at 30 June 2007 to 17.5% at the quarter end.

The exceptional returns which have been enjoyed by the UK commercial property
market in recent years have slowed significantly. Yield compression, which has
been a key driver of returns, has now come to a halt with this trend being
reversed in the last quarter.  In September all sectors of the property market
experienced reductions in capital values as yields were marked out for the first
time since December 2001. The IPD Monthly Index showed a negative return of 1.0%
over the quarter, although total returns for property over the last 12 months
were +7.2%. This correction in pricing has been seen in a period of relatively
few transactions.

Against this background, the Company's property portfolio returned -2.4% during
the quarter. The capital value of the Company's properties fell by 3.5% with the
standard retail element of the portfolio seeing the largest fall at 4.7%.

On 28 August 2007, the Company purchased the freehold interest in 1-2 Lochside
Way, Edinburgh Park, Edinburgh for £14.4m, reflecting a net initial yield to the
Company of 5.5%. The property is an office building situated on one of
Scotland's premier out-of-town business parks. The accommodation comprises
42,401 sq ft, together with 143 car spaces. The property is let to HSBC
Securities Services (UK) Ltd, with a guarantee from
HSBC Bank plc, on two leases expiring in August 2014 at £837,380 per annum. The
next review is due on 29 August 2009. The purchase is in line with the strategy
to seek prime investments, well let to good tenant covenants. Following the
purchase, the Company's net gearing has increased, to 26.2% of total assets from
18.3% as at 30 June 2007.

The portfolio enjoys a secure income stream from relatively low risk tenants (as
measured by IPD) together with an average unexpired lease term of 9.0 years. The
void rate in the portfolio currently stands at 2.0%, which is below the IPD
average of 7.2%. The level of vacant property has increased from June as a
result of lease expiries but this provides opportunities to add value. At
Colnbrook, Unit 6 has become available and will be refurbished prior to
marketing. In addition a floor has become available at 48/9 St James's Street
London SW1. This will also be refurbished which will see an increase in the
estimated rental value of the building.






Top Ten Holdings

                                                             30/09/2007
                                                             Percentage
                                                           of portfolio

Property                                          Sector

48-49, St. James's Street, London, SW1            Offices          9.5%

Unit 3663, Echo Park, Banbury                     Industrial       8.8%

Units 1-8, Lakeside Road, Colnbrook               Industrial       7.4%

Mercury House, 1 Dove Wynd, Strathclyde Business  Offices          6.8%
Park

1-2 Lochside Way, Edinburgh Park, Edinburgh       Offices          6.4%

Southampton International Park, Eastleigh         Industrial       6.2%

30/40, The Parade & 47/59A Warwick Street,        Retail           5.4%
Leamington Spa

Clifton Moor Gate, York                           Retail           4.9%
                                                  Warehouse


Hemel Gateway, Boundary Way, Hemel Hempstead      Industrial       4.7%

Swift House, Cosford Lane, Rugby                  Industrial       3.9%

Total                                                             64.0%



Geographical Analysis

                                             30/09/2007       30/06/2007
                                             Percentage       Percentage
                                           of Portfolio     of Portfolio
Location
South East                                         44.9             48.2
West Midlands                                      15.2             16.3
Scotland                                           14.6              8.9
London - West End                                  11.5             11.8
Yorkshire and Humberside                            4.9              5.1
East Midlands                                       2.6              2.8
Eastern                                             2.2              2.4
Rest of London                                      2.0              2.2
South West                                          0.7              0.8
North East                                          0.7              0.8
North West                                          0.7              0.7

Total                                             100.0            100.0



Sector Analysis
                                             30/09/2007       30/06/2007
                                             Percentage       Percentage
                                           of Portfolio     of Portfolio
Sector
Industrial                                         34.2             36.5
Retail                                             31.1             33.6
Offices                                            29.8             24.8
Retail Warehouse                                    4.9              5.1

Total                                             100.0            100.0



The Board is not aware of any significant events or transactions which have
occurred since 30 September 2007 and the date of publication of this statement
which would have a material impact on the financial position of the Company.


Quarterly and Key Information

Further information regarding the Company, including performance since launch
and the most recent annual and interim reports, can be found at the Company's
website www.isispropertytrust2.com, or at www.fandc.com.



For further information please contact:

Ian McBryde/Scott Macrae
F&C Investment Business Limited
Tel: [phone]



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