Kore Us Reit · SGX:CMOU
Kore Us Reit — Keppel Pacific Oak US REIT — CGS-CIMB ProsperUS Webinar (April 2022)
35 slides from Kore Us Reit's conference presentation, Apr 26, 2022
Slide 1: CGS-CIMB ProsperUS Webinar
CGS-CIMB ProsperUS Webinar The Insights and Future of the US Sun Belt and 18-Hour Cities 26 April 2022
Slide 2: Important Notice
Important Notice The past performance of Keppel Pacific Oak US REIT is not necessarily indicative of its future performance. Certain statements made in this release may not be based on historical information or facts and may be “forward-looking” statements due to a number of risks, Content Outline u
Slide 3: Overview of KORE
Overview of KORE 105 Edgeview Denver, Colorado
Slide 4: Keppel Pacific Oak US REIT (KORE)
Keppel Pacific Oak US REIT Sponsors • Keppel Capital and KORE Pacific Advisors (“KPA”) (KORE) US Asset • Pacific Oak Capital Advisors LLC, also advisor Manager for Pacific Oak Strategic Opportunity REIT First choice US office SREIT focused Manager • Keppel Pacific Oak US REIT Management Pte. Ltd. on
Slide 5: Successful Execution of Growth Strategy
Successful Execution of Growth Strategy 9 Nov 2017: Listed on SGX Jan 2019 Aug 2021 IPO with 11 office buildings Strengthened foothold in the Completed the strategic and business campuses across strong Maitland submarket acquisitions of Bridge Crossing in 7 key growth markets with acquisition of Mai
Slide 6: 2021 Sustainability Achievements
2021 Sustainability Achievements Sustainability is at the core of our strategy and we are committed to delivering sustainable distributions to Unitholders LEED Gold 1 GHG 30% ✓ The Plaza Buildings Female Board Directors Emissions reduction for are female Scopes 1 and Representation Westmoor Center 3
Slide 7: Domestic Migration Developments
Domestic Migration Developments One Twenty Five Dallas, Texas
Slide 8: The Great American Move
The Great American Move Less dense: COVID-19 has caused people to move out of large metro areas at higher rates in 2021 than in 2020 Demographic trends accelerated by COVID-19(1): Bang for your buck: People are leaving high-cost cities in • Move to Sun Belt states and 18-Hour cities exchange for low
Slide 9: Net Domestic Migration and the Impact on the US Office Market
Net Domestic Migration and the Impact on the US Office Market The Sun Belt’s surging office market • Business restrictions set to slow the spread of the COVID-19 virus was more intense in larger urban areas, with higher population density. • More people have chosen to leave these areas to mitigate t
Slide 10: Pandemic Migration Observed Across The US
Pandemic Migration Observed Across The US Popularity of suburban states soar as the pandemic fueled widespread movement % Change in Resident Top 20 Fastest Growing States in the US(5) Sunbelt markets seeing better than average Population in 2021 real estate market performance. 1 Utah 19.3 2 Idaho 18
Slide 11: KORE's Presence In Key Growth Markets
KORE’s Presence In Key Growth Markets Popular in-migration destinations due to attractive lifestyle, culture and employment opportunities Seattle, Washington SEATTLE ❖ The Plaza Buildings ❖ Bellevue Technology Center ❖ The Westpark Portfolio #9 #9 Seattle Austin, Texas ❖ Westech 360 #4 #
Slide 12: 1Q 2022 Key Business and Operational Updates
1Q 2022 Key Business and Operational Updates Tenant lounge, 1800 West Loop South Houston, Texas
Slide 13: Financial Performance
Financial Performance Financial Highlights Distributable Income for 1Q2022 was up 10.9% year-on-year to US$16.6m 1Q 2022 1Q 2021 % due to: (US$ ’m) (US$ ’m) Change • The acquisitions of Bridge Crossing in Nashville and 105 Edgeview in Denver in Gross Revenue 37.0 34.6 6.9 August 2021. Strong balance
Slide 14: Proactive Capital Management
Proactive Capital Management 100% unsecured loans and low aggregate leverage provide greater financial flexibility As at 31 March 2022 Debt Maturity Profile Total Debt • US$567.4 million of external loans 100% of Loans Unsecured • 100% unsecured 27.3% 22.0% 21.1% Available Facilities • US$50.0 milli
Slide 15: Quality Portfolio Driven By Tech and Innovation
SEATTLE – BELLEVUE/REDMOND, Washington ATLANTA, Georgia Quality Portfolio The Plaza Buildings Bellevue Technology Center Occupancy: 95.7% The Westpark Portfolio Powers Ferry Occupancy: 67.6% Northridge Center I & II Occupancy: 78.4% Occupancy: 88.9% Occupancy: 96.8% Driven By NASHVILLE, Tennessee Te
Slide 16: Steady Income with Visible Organic Growth
Steady Income with Visible Organic Growth New Renewal Expansion New leasing demand and expansions from: ~146,768sf Leased spaces for 1Q 2022, equivalent to Professional Services(1) 41.3% 2.9% of portfolio NLA. Portfolio WALE of 21.2% 47.0% 3.7 years(3) by CRI. Finance and Insurance 33.4% Leases sign
Slide 17: Resilient Portfolio with Diversified Tenant Base
Resilient Portfolio with Diversified Tenant Base KORE’s buildings and business campuses in ~47% of KORE’s portfolio NLA comprises the tech hubs of Seattle – Bellevue/Redmond, of high-quality tenants from the growing and Austin and Denver contribute ~61% of NPI(1) defensive sectors of TAMI, medical a
Slide 18: Technology Sector Continues to Lead in Leasing
Technology Sector Continues to Lead in Leasing KORE has the presence and experience in the highly resilient tech-sector Others 13% • Tech leasing activity continues to outperform other sectors. Media/ Technology Telecomm 18% − Increased ~122% from the first quarter of 2021(1) . 5% − Displays a large
Slide 19: Low Tenant Concentration Risk
As at 31 March 2022 Low Tenant Top 10 Tenants Sector Asset Location % of CRI Comdata Inc Technology Bridge Crossing Nashville 3.5 Concentration Ball Aerospace Technology Westmoor Center Denver 3.2 Seattle – Lear Cooperation Technology The Plaza Buildings 2.7 Risk Gogo Business Technology 105 Edgevie
Slide 20: Last 12 Months Rent Growth
Last 12 Months Rent Growth 0.7% Key Growth Markets Average 1.2% United States Average 0.7% Gateway Cities Average -0.1% US Average Seattle, Bellevue CBD 0.6% Seattle, Eastside Bellevue 2.6% Seattle, Redmond 2.6% Austin, Northwest 2.4% Denver, Northwest 0.9% Denver, Broomfield Nashville, Brentwood 1.
Slide 21: Projected 12-Month Rent Outlook
Projected 12-Month Rent Outlook KORE’s average in-place rents are 8.9% below asking rents, which will continue to drive organic growth Key Growth Markets Average United States Average 3.4% 3.2% 3.2% Gateway Cities Average 2.8% US Average Seattle, Bellevue CBD 3.6% Seattle, Eastside Bellevue 3.7% Sea
Slide 22: Actual Against Projected 12-Month Market Rent Growth
Actual Against Projected 12-Month Market Rent Growth Rent growth* for the last 12 months outperformed projections for KORE’s portfolio 4.0% 3.0% 3.0% 2.6% 2.6% 2.4% 1.7% 2.0% 1.0% 0.6% -0.5% 0.6% -1.0% 0.3% 0.1% 0.0% 0.9% -1.0% -1.7% -1.9% -0.9% -2.0% -2.9% -1.2% -1.6% -3.6% -2.0% -3.0% -4.0% -4.8%
Slide 23: Market Outlook
Market Outlook Iron Point Sacramento, California
Slide 24: US Economic Progression
US Economic Progression Muted economic activity expected in 1Q 2022 % Unemployment Rate % Labour Force Participation Rate • US real GDP increased by 6.9% q-o-q in 16 66 4Q 2021 (1). 14 65 • Unemployment rate was 3.6% in March 12 2022, down from the high of 14.8% in April 64 2020’s recession(2). In F
Slide 25: Positive Economics in KORE's Key Growth Markets
Positive Economics in KORE’s Key Growth Markets KORE’s key growth markets continue to outperform national average Real GDP Percent Change at Annual Rate(1) Fourth Quarter, 2021 Key Growth Markets Average 8.9% 6.9% United States Average 6.9% US Average Gateway Cities Average 7.6% Seattle 8.3% Austin
Slide 26: Return to Office On Track to Improve
Return to Office On Track to Improve Suburban Markets Lead the Way as Tenants Target Amenity-rich Buildings ― Tenants appear to have long-term confidence in the office Texas metro areas lead in office occupancy. market as more companies are expanding their footprints than contracting(1) . Top 10 US
Slide 27: First choice US office S-REIT focused on TAMI, medical and healthcare
Strategic presence in some of the fastest growing states in the US. First choice Exposure to the fast-growing TAMI, medical and healthcare sectors provides US office S-REIT income resilience. focused on the fast-growing TAMI, medical and Highly diversified portfolio with low tenant concentration ris
Slide 28: Thank You
Thank You For more information, please visit www.koreusreit.com Connect with us on: The Plaza Building Seattle – Bellevue/Redmond
Slide 29: Additional Information
Additional Information Iron Point Sacramento, California
Slide 30: Tech-driven Cities Projected to Outperform
Tech-driven Cities Projected to Outperform KORE’s key growth markets continue to experience inbound growth Top Metros for GDP Growth: 2022 Las Vegas Orlando Miami Fort Lauderdale Seattle San Francisco San Jose Denver Los Angeles Phoenix U.S. 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 Source: Oxford Economics,
Slide 31: Top 10 Inbound vs Top 10 Outbound US States
Top 10 Inbound vs Top 10 Outbound US States KORE’s key growth markets continue to experience inbound growth Net Domestic Migration, 1 April 2020 to 1 July 2021 Florida Texas Arizona North Carolina South Carolina Tennessee INBOUND STATES Georgia Idaho Utah Nevada Michigan Minnesota Hawaii Maryland Ne
Slide 32: Commitment to ESG Excellence
Commitment to ESG Excellence Sustainability is at the core of our strategy and we are committed to delivering sustainable distributions to Unitholders Environmental Stewardship Responsible Business People & Community Achieve a 30% reduction for Uphold strong corporate governance, Maintain at least o
Slide 33: First Choice Submarkets Outlook
First Choice Submarkets Outlook Property Submarket Last 12M Last 12M Under Last 12M Projected Submarket Vacancy Rate Vacancy Rate Deliveries Absorption Construction Rental Growth Rental Growth Property (%) (%) (sf’000) (sf’000) (sf’000) (%) (%) Seattle, Bellevue CBD 11.1 5.7 1100 1000 4,267(1)* 0.6
Slide 34: Trust Structure
Trust Sponsors(1) Keppel Unitholders Structure KPA Keppel Capital International Capital Keppel Management Agreement Trustee Management Services Fees Keppel Pacific Oak US REIT ✓ Tax-efficient structure for holding Trustee Trustee Management Management (Manager) US properties Fees Services • No US co
Slide 35: Strong Sponsors: Keppel Capital and KORE Pacific Advisors
Strong Sponsors: Keppel Capital and KORE Pacific Advisors (2) • Asset management arm of Keppel Corporation • Established commercial real estate investment and a premier manager in Asia manager in the US • US$31 billion(1) • US$4.0 billion Global assets under management as at end-2021 Assets under ma
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