Kore Us REIT · SGX:CMOU
Kore Us REIT — Keppel-KBS US REIT — Non-Deal Roadshow (May 2019)
31 slides from Kore Us REIT's roadshow presentation, May 6, 2019
Slide 1: Investor Meetings in Singapore and Hong Kong
Investor Meetings in Singapore and Hong Kong 6 – 10 May 2019
Slide 2: Content Outline
Content Outline • Overview 3 • Operational Performance 5 • Market Outlook and Leasing Updates 10 • Looking Ahead 22 Important Notice: The past performance of Keppel-KBS US REIT is not necessarily indicative of its future performance. Certain statements made in this release may not be based on histor
Slide 3: Overview
Overview Downtown Bellevue, Washington
Slide 4: About Keppel-KBS US REIT
About Distinctive US office REIT focused on key growth markets Keppel-KBS US REIT Investment • To invest in a diversified portfolio of Exposure to key growth mandate income-producing commercial assets cities in the US and real estate-related assets in key growth markets of the US with favourable eco
Slide 5: Operational Performance
Operational Performance Westpark Portfolio Seattle, Washington
Slide 6: Growing to Deliver in 2018
Growing to Deliver in 2018 Distributable Income (DI) of US$1.02b Assets Under 91.6% Portfolio Committed US$43.8m Management Occupancy as at 31 December 2018 Tax Update • US Department of Treasury 2.0% above 26.5% growth Leased 23% of clarified its position and from US$804.0 million at IPO the IPO po
Slide 7: Key Highlights for 1Q 2019
Key Highlights for 1Q 2019 US$12.4m Distributable Annualised Income Distribution Yield 8.7% 30.7% above Improved 1Q 2018 Based on the market closing price of 1Q 2019 US$0.70 per Unit Performance and 22.9% above as at the last trading day of 1Q 2019 IPO Forecast Driven by ▪ higher gross 1.50 US cts D
Slide 8: 1Q 2019 Financial Performance
1Q 2019 Financial Performance Achieved 30.7% y-o-y increase in Distributable Income Actual Forecast Actual Actual % % 1Q 2019 1Q 2019 1Q 2019 1Q 2018 Change Change (US$’000) (US$’000) (US$’000) (US$’000) Gross Revenue 29,444 24,100 22.2 29,444 23,710 24.2 Property Expenses (11,256) (10,039) 12.1 (11
Slide 9: Capital Management
Capital Management Limited interest rate exposure with term loans significantly hedged Debt Maturity Profile As at 31 March 2019 34.1% 34.1% US$424.4 million of external loans Total debt (100% unsecured) 18.8% 11.8% ▪ US$50 million of revolving credit 1.2% (1) facility Available facilities ▪ US$20 m
Slide 10: Market Outlook & Leasing Updates
Market Outlook & Leasing Updates Downtown Seattle, Washington
Slide 11: US Economy at a glance
US Economy at a glance Sound Economic Fundamentals • Despite concerns over slowing growth, economic fundamentals in the US remain strong • Labour market continues to show strength with filings 2.9% +3.2% for US unemployment benefits falling to the lowest in 49 years(2) Real GDP growth(1) Average hou
Slide 12: US Market Outlook
US Market Outlook Attractive US Office Real Estate Fundamentals Overall Net Absorption(1) Deliveries & Demolitions(1) 100.0 Forecast 90.0 80.0 70.0 60.0 MSF 50.0 40.0 30.0 20.0 10.0 0.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Net Absorption Overall Asking Rents & Vacancy (1) $36.00 11.5% F
Slide 13: Key Growth Markets with Positive Fundamentals
Key Growth Markets with Positive Fundamentals Seattle, Washington Atlanta, Georgia Overview 13 freehold office properties The Plaza Buildings Bellevue Technology Center The Westpark Portfolio Northridge Center I & II Powers Ferry Occupancy rate: 94.2% Occupancy rate: 98.5% Occupancy rate: 97.8% Occu
Slide 14: Healthy Leasing Momentum
Healthy Leasing Continued Organic Growth • Over half of leasing activities in 1Q 2019 were renewals Momentum • More than half of signed leases were from Seattle properties – Bellevue Technology Center, The Plaza Buildings and The Westpark Portfolio • Leasing demand mainly from the fast-growing techn
Slide 15: Well-Diversified Tenant Base
Well-Diversified Tenant Base Resilient portfolio with low tenant concentration risk • Well-diversified tenant base across key growth sectors • Top 10 tenants comprise 17.0% of portfolio NLA and contribute 19.8% of cash rental income Top 10 tenants by CRI as at 31 March 2019 Portfolio tenant base com
Slide 16: Key Growth Markets Outlook
Key Growth Markets Outlook Our Markets have Outperformed the National Average Over the Last 5 Years Real GDP Growth Average (1) 2013 - 2017 7.0% 6.4% Key Growth Markets Gateway Cities 6.0% 5.0% 4.7% 4.0% 4.0% 3.7% 3.3% 3.5% 3.0% 3.0% 3.0% 2.6% 2.2% 2.3% 2.2% 2.0% 1.3% 1.4% 1.1% 1.1% 1.0% 0.0% Atlant
Slide 17: Key Growth Markets Outlook
Key Growth Markets Outlook Our Markets have Outperformed the National Average Over the Last 5 Years Employment Growth Average (1) 2014 - 2018 5.0% Key Growth Markets Gateway Cities 4.0% 4.0% 3.6% 2.9% 3.0% 3.0% 2.8% 2.8% 2.8% 2.9% 2.0% 1.9% 1.6% 1.7% 1.7% 1.8% 1.3% 1.4% 1.0% 0.0% Atlanta Austin Denv
Slide 18: Key Growth Markets Outlook
Key Growth Markets Outlook Our Markets have Outperformed the National Average Over the Last 5 Years Population Growth Average (1) 2013-2017 3.0% 2.9% Key Growth Markets Gateway Cities 2.4% 2.2% 2.0% 2.0% 1.8% 1.7% 1.5% 1.2% 1.2% 1.1% 1.0% 0.8% 0.7% 0.5% 0.4% 0.0% 0.0% Atlanta Austin Denver Houston O
Slide 19: Key Growth Markets Outlook
Key Growth Markets Outlook Our Markets are Forecasted to Outperform National Average Strength from the ground up • Fast growing and defensive sectors such as technology, government, medical and healthcare are driving the economies in these submarkets • Many of these submarkets including Seattle, DC
Slide 20: Key Growth Markets Outlook
Key Growth Markets Outlook Growing Educated Workforce and Rising Household Income Educational Attainment – % of population with at least a Bachelor’s Degree (1) • Maitland has one of the largest percentages of graduates 2013 2014 2015 2016 2017 with advanced degrees in the metro and is dominated by
Slide 21: First Choice Submarkets Outlook
First Choice Submarkets Outlook Submarket Last 12M Last 12M Average Submarket Last 12M Projected Submarket Vacancy Rate Deliveries absorption Rent Rental Growth Rental Growth Property (%) (sf’000) (sf’000) (US$ p.a.) (%) (%) Seattle, Bellevue CBD The Plaza Buildings 5.1% - 210.0 50.1 8.7% 7.4% Seatt
Slide 22: Looking Ahead
Looking Ahead Northridge Center II, Atlanta, Georgia
Slide 23: Focused on Stable Distributions and Delivering Long Term Value
Focused on Stable Distributions and Delivering Long Term Value Portfolio Value Accretive Prudent Capital Optimisation Acquisitions Management • Focused leasing • Pursue growth • Effective hedging to opportunities that mitigate against impact strategy targeting create long term value of unfavourable
Slide 24: Committed to Deliver Value
Committed to Deliver Value • Vision To be the preferred real estate investment trust offering Unitholders the opportunity to invest in a distinctive portfolio of office properties in the United States • Mission To deliver sustainable distributions and strong total returns to our Unitholders through
Slide 25: Thank You
Thank You For more information, please visit www.kepkbsusreit.com Westech 360 Austin, Texas
Slide 26: Additional Information
Additional Information Bellevue Technology Center Seattle, Washington
Slide 27: Portfolio Overview
Portfolio Overview NLA Committed occupancy WALE Valuation Property City Location (sf) (by NLA) (in years) (US$m)(1) The Plaza Buildings Seattle Bellevue CBD, one of the most active leasing submarket in 490,994 94.2% 3.6 253.5 Seattle Bellevue Technology Seattle Bellevue, one of the most active leasi
Slide 28: First Choice Submarkets: West Coast
Central First Choice Submarkets : West Coast 31% Seattle Sacramento • Strong economic and population growth, largely driven • The capital of California and benefits from a Seattle by technology and aerospace manufacturing industries diversified economy (e.g. education, healthcare and • Portfolio loc
Slide 29: First Choice Submarkets: Central
First Choice Submarkets: Central East Coast 12% Denver Austin Houston • Young and educated workforce, • Major technology hub in Texas which • Fifth largest MSA in USA, and home Denver strong population growth and low benefits from a highly educated to the Texas Medical Center (world’s West Coast 57%
Slide 30: First Choice Submarkets: East Coast
First Choice Submarkets: East Coast Atlanta East Coast 12% • Orlando • Atlanta Orlando • Robust metropolitan area and a major hub for • Third most Fortune 500 company headquarters in the aerospace companies with thriving technology, US, with a steady stream of business relocations and healthcare and
Slide 31: Tax-Efficient Structure
Tax-Efficient Structure Sponsors(1) KPA Unitholders Keppel Capital relevant Keppel Capital Tax-efficient structure for holding US properties entity International ▪ No US corporate tax (21%) and Keppel Management US withholding tax (30%) Agreement Trustee Management ▪ No Singapore corporate tax (17%)