Keppel REIT · SGX:K71U
Keppel REIT — K-REIT Asia — Non-Deal Roadshow (August 2009)
33 slides from Keppel REIT's roadshow presentation, August 2009
Slide 1: Investor Meetings August 2009
INVESTOR MEETINGS August 2009
Slide 2: Contents
Contents Overview Stable Portfolio Balanced Capital Structure Market Review & Outlook 2
Slide 3: Overview
Overview K-REITaSia
Slide 4: Quality Portfolio
Quality Portfolio Quality assets • Located near/within Central Business District • Award-winning One Raffles Quay and Prudential Tower Blue-chip tenants Managed by experienced professionals 4
Slide 5: Rising Distributions Per Unit
Rising Distributions Per Unit 11 10.08 10 8.82 8.91 9 DPU (cents) 8 7 6.76 6 5 (1) FY2006 FY2007 FY2008 FY2009 (Annualised) (1) Based on annualised DPU for 1H 2009; distribution for 1H 2009 was 5.00 cents per unit 5
Slide 6: Attractive Distribution Yield
Attractive Distribution Yield As at 12 Aug 2009 9.7% 9.3% Net Yields: Foreign Corporates (with 10% tax) 8.7% Tax Free for 4.6% Local Individuals Corporates 2.5% 2.5% (with 17% tax) 8.1% 0.5% K-REIT Asia FTSE ST REIT FTSE ST RE Index 10-year Govt CPF Ordinary DBS 12-month (2) (3) Annualised 1H Index
Slide 7: Healthy Balance Sheet
Healthy Balance Sheet Aggregate leverage maintained at 27.6% As at ($ million) 30 Jun 2009 Non-current Assets 2,021.4 Total Assets 2,080.1 Borrowings 578.0 Total Liabilities 608.8 Unitholders' Funds 1,471.3 Net Asset Value Per Unit $2.22 Adjusted Net Asset Value Per Unit (1) $2.17 (1) Excluding di
Slide 8: Stable Portfolio
Stable Portfolio K-REITaSia
Slide 9: Broad Tenant Diversity
Broad Tenant Diversity Tenant Business Sector by Net Lettable Area as at 30 Jun 2009 Shipping & marine Accounting & services consultancy services 7.4% 4.0% Services 9.3% Real estate & property services 8.2% Banking, insurance & 111 tenants financial services Pharmaceuticals & in total 35.4% healthca
Slide 10: Blue-chip Tenants
Blue-chip Tenants Portfolio’s Top 10 Tenants by Net Lettable Area as at 30 Jun 2009 Deutsche Bank 8.0% I.E.Singapore 7.3% GE Pacific 6.8% UBS AG 6.5% One Raffles Quay 6% ABN AMRO 5.4% Bugis Junction Towers 5% Keppel Land 5.0% Keppel Towers and GE Tower Total 51.8% 7% of portfolio’s Prudential Tower
Slide 11: Portfolio Occupancy Rate vs Market
Portfolio Occupancy Rate vs Market 94.9% committed occupancy of portfolio as at 30 Jun 2009, higher than: • Core CBD occupancy of 91.5%(1) • Island-wide occupancy of 89.2%(2) As at As at Change in K-REIT Asia’s Assets 30 Jun 31 Dec Vacancy 2009 2008 Keppel Towers and GE Tower 93.3% 99.2% 25,804 sf
Slide 12: Long Lease Terms Provide Stable Income
Long Lease Terms Provide Stable Income Weighted average lease term to expiry for • Portfolio: 5.4 years • Top 10 tenants who account for 51.8% of portfolio’s NLA: 7.1 years 28.2% of portfolio’s NLA accounted by long lease terms(1) % of Portfolio’s Net Lettable Area (NLA) Accounted by Long Lease
Slide 13: Portfolio Lease Profile
Portfolio Lease Profile Gross rental income based on committed leases for FY2009 already exceeds FY2008’s total gross rental income Lease Profile as a % of Net Lettable Area as at 12 Aug 2009 20% 16.6% 16.7% 11.5% 9.5% 9.7% 8.1% 6.3% 5.0% 0% Mid-Aug to Dec 2009 2010 2011 2012 2013 Lease Expiry as
Slide 14: Improved Average Portfolio Rent
Improved Average Portfolio Rent Average portfolio rent in Jun 2009: $8.13 psf pm(1) • $7.11 psf pm, excluding 1/3 ORQ Average Portfolio Gross Rental Rates $8.13 $8.06 $7.61 $7.37 $7.43 $6.86 $6.02 $4.43 psf per month $4.28 Jun Sep Dec Mar Jun Sep Dec Mar Jun 2007 2007 2007 2008 2008 2008 2008 2009
Slide 15: Balanced Capital Structure
Balanced Capital Structure K-REITaSia
Slide 16: Prudent Financial Management
Prudent Financial Management Aggregate leverage will exceed 60% limit only if average portfolio valuation falls by more than 54% As at 30 Jun 2009 Gross Borrowings (1) $581.1m Aggregate Leverage 27.6% All-in Interest Rate 4.26% Interest Coverage Ratio (2) 3.18 times Weighted Average Term to Expiry
Slide 17: Debt Maturity Only In 2011
Debt Maturity Only In 2011 About 2/3 of total debt is unsecured $1 billion medium-term note programme in place Debt Profile as at 30 Jun 2009 Fixed-rate $190m Maturing in May 2011 mortgage loan Floating-rate $391m Maturing in Mar 2011 unsecured loan 0 100 200 300 400 17
Slide 18: Market Review & Outlook
Market Review & Outlook K-REITaSia
Slide 19: Market Sentiments Improve
Market Sentiments Improve Uncertainty in global economic outlook • Singapore office demand likely to be subdued in 2009 Some positive signs of bottoming • Collective efforts by worldwide governments prevent downturn from worsening • Singapore government revises 2009 GDP forecast upwards to betwe
Slide 20: Moderation in Rents Eases in 2Q
Moderation in Rents Eases in 2Q Flight to quality and opportunistic expansion as rents moderate Singapore Office Market Occupancy and Rentals(1) 97.3% 97.1% 97.6% 97.6% 97.1% 96.2% 95.4% $20 93.1% 91.5% 100% $18 80% $16 $14 60% $12 18.65 18.80 18.80 17.15 40% $10 16.00 16.10 16.10 14.90 15.00 15.0
Slide 21: Singapore: Key Business Destination
Singapore: Key Business Destination Singapore: • Remains a key investment market in Asia – 4th in Forbes magazine's 2009 ranking of the best countries to do business • Financial sector in Singapore selectively re-hiring • Diversifying beyond a financial hub and establishing multi-hubs in various i
Slide 22: Competitive Occupancy Costs in Singapore
Competitive Occupancy Costs in Singapore Colliers’ Asia-Pacific Grade A office rents ranking in 2Q 2009 • Singapore’s rents fell below Ho Chi Minh City CBRE survey: Singapore ranked #15, compared to #9 a year ago • Ranked below Tokyo, Hong Kong, Mumbai and New Delhi CBRE’s Global 50 Index for Of
Slide 23: Going Forward
Going Forward Active • Tenant retention • Asset enhancement Asset • Monitor risk of default Sustainable Management • Optimise operating efficiency Growth Prudent • MTN programme in place Capital • Refinance debt due in 2011 Long-term Management Stable Growth in Distributions Asset Value Acquisitions
Slide 24: Leveraging on Key Strengths
Leveraging on Key Strengths Pan-Asian office- Office-focused focused S-REIT Pursue pan-Asian acquisition opportunities Portfolio of prime and grade-A office buildings Quality assets and Buildings located at convenient locations within/near CBD tenants Quality tenants with diverse trade mix
Slide 25: Important Notice
IMPORTANT NOTICE The value of units in K-REIT Asia (“Units”) and the income from them may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the
Slide 26: Additional Information
Additional Information K-REITaSia
Slide 27: Overview
Overview Corporate background: • Listed on SGX in April 2006 following a distribution in specie of units • Initial portfolio of 4 office buildings valued at $630.7 million • 5 assets currently after acquiring 1/3 interest in One Raffles Quay in Dec 2007 Investment Theme • Commercial REIT with pan-
Slide 28: 1H 2009 Distributable Income Up 29.6%
1H 2009 Distributable Income Up 29.6% ($'000) 1H 2009 1H 2008 Change % Chg Property Income 30,142 24,495 5,647 23.1 Net Property Income 23,136 18,315 4,821 26.3 Distributable Income 33,154 25,581 7,573 29.6 to Unitholders Distribution Per Unit (cents) 5.00 3.94 1.06 26.9 (1) (2) Distribution Yield (
Slide 29: 2Q 2009 Distributable Income Up 23.4%
2Q 2009 Distributable Income Up 23.4% ($'000) 2Q 2009 2Q 2008 Change % Chg Property Income 15,357 12,989 2,368 18.2 Net Property Income 12,316 9,174 3,142 34.2 Distributable Income 17,496 14,176 3,320 23.4 to Unitholders Distribution Per Unit (cents) 2.64 2.18 0.46 21.1 (1) (2) Distribution Yield (%
Slide 30: Prudential Tower Property
Prudential Tower Property 30-storey Grade-A building Located at Raffles Place, within a 5-minute walk from MRT station 44.4% of building’s strata area owned by K-REIT Asia Winner of office/industrial category of the FIABCI Prix d‘Excellence Awards 2003 Key Property Information as at 30 Jun 2009
Slide 31: Keppel Towers and GE Tower
Keppel Towers and GE Tower Keppel Towers: 27-storey office building GE Tower: 13-storey office building, within a five-minute walk from MRT station Keppel Towers GE Tower Located in the Tanjong Pagar vicinity Key Property Information as at 30 Jun 2009 Net Lettable Area 39,963 sm (430,162 sf) Tenu
Slide 32: Bugis Junction Towers
Bugis Junction Towers 15-storey office tower located along Victoria Street, Directly linked to Bugis MRT station Part of an integrated development known as Bugis Junction, with a retail mall and the five-star InterContinental Singapore hotel Key Property Information as at 30 Jun 2009 Net Lettable
Slide 33: One Raffles Quay
One Raffles Quay Grade-A office building strategically located at gateway to Singapore’s new business and North Tower South Tower financial district 50-storey North Tower and a 29-storey South Tower Direct underground link to Raffles Place MRT station Won FIABCI Prix d‘Excellence Award 2008 and