Keppel Reit · SGX:K71U
Keppel Reit — Investor Presentation (March 2023)
30 slides from Keppel Reit's investor presentation, March 2023
Slide 1: Investor Presentation
Investor Presentation March 2023
Slide 2: Outline
Outline Constituent of: ▪ FY 2022 Key Highlights 3 ▪ Financial Results 5 FTSE ST Large & FTSE4GOOD ▪ Portfolio Review 9 Mid Cap Index Developed & FTSE4GOOD ASEAN 5 Index ▪ Market Review 18 ▪ Additional Information 23 FTSE EPRA Nareit Global Developed Index IMPORTANT NOTICE: The past performance of K
Slide 3: FY 2022 Key Highlights
FY 2022 Key Highlights $10 million of the Anniversary Distribution will be distributed in March 2023(1) Pan-Asian Portfolio with Higher Distribution to Unitholders High Portfolio Occupancy Income Resilience Anchored in key business districts of $220.9m 96.3% Singapore, Australia, South Korea and Jap
Slide 4: Sustainable and Future Ready Portfolio with ESG
ESG Benchmarks Sustainable and • MSCI ESG Rating maintained at ‘A’ Future Ready • ISS Governance Risk Rating maintained at lowest risk level of “1” and ESG Corporate Rating maintained at “Prime” status Portfolio with ESG • Global Real Estate Sustainability Benchmark (GRESB) – Green Star status; ‘A’
Slide 5: Financial Results
Financial Results Pinnacle Office Park, Sydney 5
Slide 6: FY 2022 Distribution to Unitholders Increased 4.1%
FY 2022 Distribution to Unitholders Increased 4.1% ▪ FY 2022 Distribution to Unitholders increased 4.1% year-on-year to $220.9m, which included the first tranche of the Anniversary Distribution of $10m(1) ▪ 2H 2022 DPU grew 2.4% year-on-year to 2.95 cents; FY 2022 DPU increased 1.7% to 5.92 cents Di
Slide 7: Healthy Balance Sheet
Healthy Balance Sheet As at 31 Dec 2022 As at 31 Dec 2021 +/(-) Deposited Property(1) $9,395m $9,085m +3.4% Total Assets $8,881m $8,488m +4.6% Borrowings(2) $3,606m $3,485m +3.5% Total Liabilities $3,016m $2,898m +4.1% Unitholders’ Funds $5,119m $4,866m +5.2% Adjusted NAV per Unit(3) $1.34 $1.29 +3.
Slide 8: Prudent Capital Management
Prudent Capital Management As at 31 Dec 2022 Interest Coverage Ratio 3.3x ▪ Maintained a healthy aggregate leverage of 38.4% All-in Interest Rate 2.29% p.a. ▪ Increased borrowings on fixed rates from 72% as at Aggregate Leverage 38.4% 30 Sep 2022 to 76% as at 31 Dec 2022 Weighted Average Term to Mat
Slide 9: Portfolio Review
Portfolio Review Ocean Financial Centre, Singapore 9 Photo Credit: Central Narcotics Bureau
Slide 10: Diversified Pan-Asian Portfolio of Prime Commercial Assets
Diversified Pan-Asian Portfolio of Prime Commercial Assets $9.2b portfolio of prime quality assets anchored across different markets enhance income stability and long-term growth opportunities T Tower, Seoul KR Ginza II, Tokyo(1) 98.5% Interest 99.4% Interest South Korea Japan Occupancy: 100.0% Occu
Slide 11: FY 2022 Portfolio Performance
FY 2022 Portfolio Performance Leases Committed Leases Committed As at 31 Dec 2022: (1) (1) by Geography by Type Singapore, 79.5% Australia, 10.0% Renewal, New, 96.3% 35.3% Portfolio committed 64.7% South Korea, occupancy 10.5% New leasing demand and expansions from: 10.5 years Top 10 tenants’ WALE T
Slide 12: Well-spread Lease Expiry Profile
Well-spread Lease Expiry Profile ▪ Average signing rent for Singapore office leases(1) concluded in FY 2022 was $11.54 psf pm, reflecting steady demand for prime office space ▪ Average expiring rents of Singapore office leases(2)(psf pm): $11.43 in 2023, $11.03 in 2024 and $11.11 in 2025 Lease Expir
Slide 13: Established and Diversified Tenant Base
Established and Diversified Tenant Base ▪ Keppel REIT has a diversified tenant ▪ Top 10 tenants take up 39.5% of NLA and base of 422(1) tenants, many of which contribute 34.0% of gross rent are established blue-chip corporations Top 10 Tenants Tenant Business Sector % Banking, insurance and financia
Slide 14: Blue & William Secured First Anchor Tenant
Blue & William Secured First Anchor Tenant ▪ Blue & William secured its first anchor tenant, Equifax, a global data, analytics and technology company ▪ Equifax will occupy ~4,350 sqm, ~1/3 of the building’s NLA ▪ Blue & William on track to complete by mid-2023 and Equifax will move in from late 2023
Slide 15: Increase in Singapore Portfolio Valuations
Increase in Singapore Portfolio Valuations Valuation based on Variance 31 Dec 30 Jun 2022 31 Dec 2022 Cap Rate attributable interest 2022 S$ % Ocean Financial Centre S$2,086.2m S$2,140.5m S$54.3m 2.6 S$3,067psf 3.40% (79.9% interest) Towers 1 & 2, and Marina Bay Financial S$1,757.0m S$46.0m 2.7 S$3,
Slide 16: Overall Increase in Overseas Property Valuations
Overall Increase in Overseas Property Valuations ▪ Valuation for Blue & William increased by 16.0% due to construction progress Valuation based on Local Currency (A$/KRW/JPY) Variance S$ Variance Cap 31 Dec 2022 Keppel REIT’s interest 30 Jun 2022 31 Dec 2022 A$/KRW/JPY % 30 Jun 2022 31 Dec 2022 S$ %
Slide 17: Advancing ESG Agenda
Advancing ESG Agenda Environmental Responsible People and Stewardship Business Community 100% of Keppel REIT’s All Singapore assets have >5% reduction in Scope 1 and 2 operational properties have achieved the WELL Health-Safety emissions1 rating achieved green certifications Achieved 50% sustainabil
Slide 18: Market Review
Market Review Marina Bay Financial Centre, Singapore 18
Slide 19: Singapore Office Market
Singapore Office Market ▪ Average core CBD Grade A office rents increased to $11.70 psf pm and average occupancy in core CBD maintained at 94.7% in 4Q 2022 Grade A Rent and Core CBD Occupancy Demand and Supply (million sf) 2.1 1.9 1.7 95.8% 93.8% 94.8% 95.8% 93.8% 93.3% 93.8% 93.6% 94.8% 94.7% 1.3 $
Slide 20: Australia Office Market
Australia Office Market 95.2% 1,500 91.3% 94.9% 96.0% 87.5% 88.6% 88.4% 87.1% 86.5% 85.3% 100% North Sydney 90.8% 92.1% 90.4% 89.9% 82.7% 82.4% 82.6%84.0% 100% Sydney CBD 1,200 80% 1200 75.5% 79.9% 80% 964 1,032 1,045 930 914 919 900 799 885 888 906 60% 900 729 670 60% 580 641 676 688 651 662 661 66
Slide 21: Seoul Office Market
Seoul Office Market ▪ CBD Grade A occupancy increased to 97.0% in 4Q 2022 CBD Grade A Rent and Occupancy 95.1% 97.0% 200,000 90.7% 91.2% 92.9% 100% 86.6% 86.7% 89.2% 85.0% 82.7% 160,000 80% 117,605 121,356 120,000 112,127 60% 97,572 98,926 101,276 95,169 91,845 92,325 91,656 80,000 40% 40,000 20% 0
Slide 22: Tokyo Office Market
Tokyo Office Market ▪ Occupancies for both Grade A and Grade B office in Tokyo central 5 wards increased to 96.3% in 4Q 2022 Tokyo Central 5 Wards Grade A Rent and Occupancy Tokyo Central 5 Wards Grade B Rent and Occupancy 99.6% 99.8% 99.1% 99.0% 99.4% 98.7% 100.0% 97.7% 98.1% 97.8% 97.4% 97.3% 30,0
Slide 23: Additional Information
Additional Information Keppel Bay Tower, Singapore 23
Slide 24: Committed to Delivering Stable Income & Sustainable Returns
Committed to Delivering Stable Income & Sustainable Returns Portfolio Optimisation • Improve yield by enhancing Keppel REIT’s portfolio of quality assets through strategic acquisitions and divestments Portfolio • Provide income stability and long-term capital appreciation of portfolio, Optimisation
Slide 25: Well-Executed Portfolio Optimisation Strategy
Well-Executed Portfolio Optimisation Strategy Expanded footprint to Japan: Expanded footprint to Australia: Expanded footprint KR Ginza II (98.5%), 77 King Street (100%), Sydney, and to South Korea: Tokyo 275 George Street (50%), Brisbane T Tower (99.4%), Seoul Acquired Acquired - David three adjace
Slide 26: To Distribute an Additional $100m Over the Next Five Years
To Distribute an Additional $100m Over the Next Five Years to Celebrate Keppel REIT’s 20th Listing Anniversary in 2026 • Accumulated capital gains through successful execution of portfolio optimisation since listing in 2006 • To celebrate Keppel REIT’s 20th anniversary in 2026, we will distribute $1
Slide 27: Attributable NPI by Property
Attributable NPI by Property FY 2022 FY 2021 % % $’000 $’000 Breakdown of Attributable NPI by Geography Ocean Financial Centre 67,127 21.2 65,965 20.8 (For FY 2022) Marina Bay Financial Centre 92,977 29.4 94,133 29.6 One Raffles Quay 39,587 12.5 35,453 11.2 71.7% Keppel Bay Tower(1) 27,194 8.6 16,49
Slide 28: Portfolio Information: Singapore
Portfolio Information: Singapore As at Marina Bay Financial Ocean Financial Centre One Raffles Quay Keppel Bay Tower 31 Dec 2022 Centre(4) Attributable NLA 697,855 sf 1,019,159 sf 441,496 sf 386,223 sf Ownership 79.9% 33.3% 33.3% 100.0% BNP Paribas, DBS Bank, TikTok, Keppel Group, Principal Drew & N
Slide 29: Portfolio Information: Australia, South Korea & Japan
Portfolio Information: Australia, South Korea & Japan Blue & William(3), As at 8 Exhibition Victoria Police David Malcolm 8 Chifley Square, Pinnacle Office Sydney T Tower, KR Ginza II, 31 Dec 2022 Street(4), Centre, Justice Centre, Sydney Park, Sydney (Under Seoul Tokyo Melbourne Melbourne Perth Dev
Slide 30: Thank you
Thank you Blue & William, Sydney Artist Impression 30