Keppel REIT · SGX:K71U
Keppel REIT — Shareholder Meeting (April 2019)
24 slides from Keppel REIT's shareholder meeting presentation, Apr 23, 2019
Slide 1: Annual General Meeting
Annual General Meeting 23 April 2019
Slide 2: Outline
Outline • Overview 3 • Driving Performance 5 • Acquisition in Seoul 17 IMPORTANT NOTICE: The past performance of Keppel REIT is not necessarily indicative of its future performance. Certain statements made in this presentation may not be based on historical information or facts and may be “forward-l
Slide 3: Young and Green Commercial Assets
Young and Green Commercial Assets Large Portfolio of Strong Portfolio Commitment to Premium Office Assets Occupancy and WALE Sustainability High portfolio committed BCA Green Mark Platinum Over $8 billion of occupancy and long WALE award for all Singapore assets; Grade A commercial assets provides i
Slide 4: Milestones since Listing
Milestones since Listing Acquired Acquired 50% of Expanded Listed on footprint to Increased Acquired 87.5% of David Malcom Justice Acquired 50% of SGX South Korea Stake in 50% of Ocean Centre, Perth, and Acquired three 311 Spencer Street with over Prudential 8 Chifley Financial 8 Exhibition Street,
Slide 5: Driving Performance
Driving Performance Marina Bay Financial Centre, Singapore
Slide 6: FY 2018 Highlights
FY 2018 Highlights Distributable Income Leases Committed $189.0 m(1) 2,853,100 sf (Attributable area ~1,227,100 sf) Distribution per Unit Portfolio Committed Occupancy Average signing rent for 5.56 cents 98.4% Singapore office leases Aggregate Leverage Portfolio WALE ~$11.10(2) psf above Grade A cor
Slide 7: Proactive Leasing Strategy
Proactive Leasing Strategy ▪ Committed occupancies as at end-2018 remain healthy and above market average High Portfolio Committed Occupancy (as at 31 December 2018) Singapore Australia Overall 98.1% 99.4% 98.4% 100.0% 96.1% 99.9% 96.1% 99.3% 98.7% 100.0% 100.0% 98.4% Singapore’s core CBD Australia’
Slide 8: Diversified Tenant Base
Diversified Tenant Base Top 10 Tenants Profile of Tenant Base 40.1% of NLA 37.8% of gross rent 336(1) tenants in total DBS 6.6% Government of Western Australia Australia 5.3% Standard Chartered 4.5% 4.6% Banking, insurance & financial services Ocean Financial Government agency Ernst & Young 4.1% Cen
Slide 9: Well-Spread Lease Expiry Profile
Well-Spread Lease Expiry Profile ▪ Long overall portfolio WALE of 5.9 years ▪ Top 10 tenants’ WALE was 8.2 years Portfolio Lease Expiry Profile (as at 31 December 2018) 44.3% 16.7% 18.5% 8.2% 7.5% 6.5% 4.0% 7.7% 4.2% 3.5% 0.4% 0.0% 2019 2020 2021 2022 2023 2024 and beyond Expiring leases Rent review
Slide 10: Unit Buy-Back Programme
Unit Buy-Back Programme Monthly Unit Buy-Back Volume ▪ Buying back Units below NAV (since initiation of programme) is accretive to Unitholders and 13.56m is part of proactive capital management strategy ▪ As at 31 March 2019, purchased 5.36m and cancelled 34.0 million 4.08m 3.50m 3.25m issued Units
Slide 11: Proactive Capital Management
Proactive Capital Management Managing interest rate exposure (as at 31 March 2019) ▪ Refinancing remaining loans due in 2019 9% with commitments received as at 31 March 2019 Fixed-Rate ▪ Extended weighted average term to maturity Borrowings from 2.8 years(1) to 3.3 years(2) in 1Q 2019 Floating-Rate
Slide 12: Convertible Bonds
Convertible Bonds ▪ Issued 5-year convertible bonds on 10 April Debt Maturity Profile 2019 at coupon rate of 1.90% to lower (as at 31 Mar 2019, assuming convertible bonds were issued in 1Q 2019) interest costs and diversify funding sources 31% ▪ Estimated interest savings of 21% $200m approximately
Slide 13: Unlocking Capital Gains
Unlocking Capital Gains ▪ Divested 20% stake in Ocean Financial Centre to Allianz ▪ Keppel REIT maintains controlling stake of 79.9% ▪ Unlocking capital gains while maintaining exposure to strengthening Singapore Grade A office market 20% of Ocean Financial Centre Sale Price(1) $537.3 m Purchase Pri
Slide 14: 311 Spencer Street Development
311 Spencer Street Development ▪ Construction of freehold Grade A office tower is in progress in Melbourne ▪ 30-year lease to the Victoria Police will commence in 1H 2020 and contribute steady income ▪ Average NPI Yield: 6.4%(1) ▪ Stable income stream: 30-year lease with fixed annual rental escalati
Slide 15: Future-Proofing Assets
Future-Proofing Assets Before After 275 George Street, Brisbane Initiatives carried out to rejuvenate asset Artist’s impression after foyer upgrade 8 Exhibition Street, Melbourne Initiatives planned to improve amenities Artist’s impression after foyer upgrade 15
Slide 16: 1Q 2019 Key Highlights
1Q 2019 Key Highlights Portfolio • Delivered distributable income (DI) of Statistics $47.3 million(1) and distribution per Unit (DPU) of 1.39 cents High Committed Occupancy • Lowered aggregate leverage to 35.7% and 98.7% extended weighted average term to maturity to 3.3 years(2) • Issued $200.0 mill
Slide 17: Acquisition in Seoul
Acquisition in Seoul T Tower in Seoul’s CBD
Slide 18: Transaction Overview
Transaction Overview ▪ Acquiring 99.38%(1) of T Tower, a freehold Grade A office building in Seoul’s central business district (CBD) ▪ Entry into Seoul which has a deep office market with favourable fundamentals ▪ Ability to leverage Keppel Capital’s on-the-ground presence and experience to seek opp
Slide 19: Transaction Overview (Cont'd)
Transaction Overview (Cont’d) ▪ DPU-accretive acquisition with NPI yield of 99.38% of T Tower KRW $ 4.7% is part of ongoing portfolio optimisation efforts to improve portfolio yield Independent Valuation by 259.0b 309.0m Cushman & Wakefield(1) ▪ Agreed property value of KRW 252.6 billion(1,3) (appro
Slide 20: Video of T Tower in Seoul
Video of T Tower in Seoul Click to view property video 20
Slide 21: Merits of Acquisition
Merits of Acquisition 1 Entry into Seoul which has a deep office market with favourable fundamentals 2 Freehold Grade A commercial building in the CBD 3 DPU-accretive acquisition 4 Geographical and income diversification 5 Leverage Keppel Capital’s on-the-ground presence and experience in South Kore
Slide 22: DPU-Accretive Acquisition
DPU-Accretive Acquisition ▪ Acquisition of T Tower brings 2.5%(1) DPU accretion on a pro forma basis for FY 2018 FOR ILLUSTRATIVE PURPOSES ONLY: Pro forma financial effects of the acquisition on DPU Pro Forma Impact Before After of the Acquisition (FY 2018) (Assuming acquisition was completed on 1 J
Slide 23: Pan-Asia REIT with Premium Office Portfolio
Pan-Asia REIT with Premium Office Portfolio $8.4b portfolio of 10 prime commercial assets in key business districts of Singapore, Australia and South Korea T Tower, Seoul 311 Spencer Street, 99.38% Interest Melbourne (Pending Completion) Ocean Financial 50% Interest South Korea Centre (Under develop
Slide 24: Thank You
Thank You [Keppel [ais a 4