CapitaLand Integrated Commercial Trust · SGX:C38U
CapitaLand Integrated Commercial Trust — H1 2021 Earnings Presentation
65 slides from CapitaLand Integrated Commercial Trust's earnings presentation, Jul 28, 2021
Slide 1: First Half 2021 Financial Results
CAPITALAND INTEGRATED COMMERCIAL TRUST First Half 2021 Financial Results 28 July 2021
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors incl
Slide 3: Contents
Contents Slide No. 1. Highlights 04 2. Financial Performance 11 3. Portfolio Performance 19 4. Performance by Asset Type 23 5. Creating Value 38 6. Looking Forward 44 7. Market Information 47 8. Additional Information 61 Note: Any discrepancies in the tables and charts between the listed figures and
Slide 4: Highlights
Riedie i Highlights ll (MMeuilcing
Slide 5: Achieved 1H 2021 DPU of 5.18 cents
Achieved 1H 2021 DPU of 5.18 cents Distributable Income Distributable Income 1H 2021 Distributable Income (1) 335.9 S$335.9 (1) (2) 109.7 million 1H 2020 1H 2021 DPU (cents) 1H 2021 Distribution Per Unit (DPU) 5.18 5.18 2.96 cents 1H 2020 1H 2021 Notes: (1) S$2.2 million was retained for gen eral co
Slide 6: Operating metrics highlights
Operating metrics highlights 1H 2021 operations impacted by Phase 2 (Heightened Alert) Recovery level 86.3% (1) Portfolio Committed Retail Tenants’ Sales Sustainability (average monthly • Main Airport Center obtained 105.3% (2) Occupancy BREEAM Good on 28 April 2021 (as at 30 June 2021) 94.9% of 1H
Slide 7: CapitaSpring TOP to be phased; on track to complete in 4Q 2021
CapitaSpring TOP to be phased; on track to complete in 4Q 2021 View from Market Street View from Church Street ► Achieved a committed occupancy of 61.8% as at 22 July 2021, with another 15% under advance negotiation ► Committed leases to contribute income progressively from 1H 2022 Leasing Breakdown
Slide 8: Key market environment update: COVID-19
Key market environment update: COVID-19 Fluid COVID-19 situation prompted a series of measures by the Singapore Government Phase 2 Phase 2 Phase 3 (Heightened Alert) (Heightened (Heightened Phased Reopening Alert) Alert) 16 May – 13 Jun From 14 Jun From 21 Jun From 12 Jul From 19 Jul From 22 Jul to
Slide 9: Key market environment update: COVID-19
Key market environment update: COVID-19 Government support for businesses and workers to tide through operational challenges while Singapore aims to transition to new normal with higher vaccination target ► Government’s S$1.2 billion support provided targeted assistance from 16 May to 12 July: • Aff
Slide 10: CICT COVID-19 support
CICT COVID-19 support Supporting tenants, ensuring the safety and well-being of stakeholders a priority ► Ensure the safety and well-being of our stakeholders by adopting the safe management measures ► Support retail tenants whose operations are directly or indirectly impacted by the tightened measu
Slide 11: Financial Performance
Financial Performance Six Battery Road
Slide 12: 1H 2021 financial performance
1H 2021 financial performance Better performance year-on-year driven by enlarged portfolio and 100% contribution from RCS Gross Revenue Net Property Income S$645.7 million S$472.2 million Retail Asset Performance Office Asset Performance (1) Integrated Development (S$ m) (S$ m) Performance (2) 267.7
Slide 13: NPI contribution by Top 5 properties accounts for 47.3%
NPI contribution by Top 5 properties accounts for 47.3% Net Property Income Contribution Net Property Income Contribution by Asset Type(1) by Top 5 properties(1) Raffles City Singapore, I ntegrated 14.8% dev elopments, 28.9% Plaza Singapura & The Retail , Atrium@Orchard, 40.0% 1H 2021 1H 2021 9.7% N
Slide 14: Healthy balance sheet
Healthy balance sheet As at 30 June 2021 S$’000 Non-current Assets 22,199,056 Net Asset Value/Unit S$2.05 Current Assets 429,164 Adjusted Net Asset Value/Unit S$2.00 Total Assets 22,628,220 (excluding distributable income) Current Liabilities 1,024,271 Non-current Liabilities 8,257,089 Total Liabili
Slide 15: CICT debt maturity profile as at 30 June 2021
CICT debt maturity profile as at 30 June 2021 Facilities in place to refinance debt maturing in 2021 and 2022 (1) S$ million 1,800 17% 17% 1,606 1,583 1,600 14% 1,400 1,347 11% 11% 1,200 11% 870 1,072 900 1,066 1,004 1,000 265 832 299 418 800 6% 187 580 600 486 4% 290 400 215 736 683 460 3% 2% 518 2
Slide 16: Key financial indicators
Key financial indicators As at As at 30 June 2021 31 March 2021 Unencumbered Assets as % of Total Assets 95.8% 95.8% Aggregate Leverage(1) 40.5% 40.8% Net Debt / EBITDA(2) N.M. N.M. Interest Coverage(3) 4.0x 3.7x Average Term to Maturity (years) 4.3 4.4 Average Cost of Debt(4) 2.4% 2.4% CICT’s Issue
Slide 17: Diversified sources of funding and certainty of interest expense
Diversified sources of funding and certainty of interest expense Floating Rate Unsecured 15% Assuming +0.1% p.a. Proforma impact on: Bank Loans increase in interest rate 32% Funding Sources Borrowings Estimated additional (2) as at as at +S$1.4 million p.a. 30 June 2021 (1) MTN (1) annual Interest (
Slide 18: Distribution details
Distribution details Distribution Period 1 January to 30 June 2021 Distribution Per Unit 5.18 cents Notice of Record Date 28 July 2021 Last Day of Trading on ‘cum’ Basis Tue, 3 August 2021, 5.00 pm Ex-Date Wed, 4 August 2021, 9.00 am Record Date Thu, 5 August 2021 Distribution Payment Date Thu, 9 Se
Slide 19: Portfolio Performance
Portfolio Performance Bedok Mall
Slide 20: Portfolio lease expiry profile as at 30 June 2021
Portfolio Portfolio lease expiry profile(1)(2) as at 30 June 2021 Portfolio Weighted Average Lease Expiry by Monthly Gross Rental Income 3.1 Years 19.8% 13.6% 11.6% 9.9% 9.3% 7.2% 7.0% 5.2% 4.7% 3.9% 2.7%2.6% 2.5% (3) 2021 2022 2023 2024 2025 2026 and beyond Retail Office Hospitality Notes: (1) Excl
Slide 21: No single tenant contributes more than 5% of gross rental income
Portfolio No single tenant contributes more than 5% of CICT’s total gross rental income(1) % of Total Ranking Top 10 Tenants for June 2021 Trade Sector Gross Rent 1 RC Hotel (Pte) Ltd 4.8 Hotel 2 WeWork Singapore Pte. Ltd.(2) 2.8 Real Estate and Property Services Supermarket / Beauty & Health / Serv
Slide 22: Diversified tenants' business trade mix
Portfolio Diversified tenants’ business trade mix Food & Beverage, Banking, Insurance and Financial Services and Beauty & Health remain as the top 3 portfolio trade mix IT, Media and Other Retail and Product Trades Travel and Hospitality, Telecommunications, 3.7% Gifts & Souvenirs / Toy & Hobbies 5.
Slide 23: Performance by Asset Type
Performance by Asset Type Please note: The retail and office asset information included the respective retail and office components of integrated developments unless stated otherwise, in order to show the operating metrics and trends Capital Tower
Slide 24: Retail performance overview
Retail Retail performance overview Compared against FY 2019 Compared against 1H 2020 2Q 2021 New Retail Openings monthly average monthly average by NLA 1H 2021 Tenants’ Sales psf Retail Others, 8.4% Occupancy(1) Recovered to Recovered to Shoes & 86.3% 105.3% Bags, 4.5% 97.0% Home as at 30 June 2021
Slide 25: Retail committed occupancy at 97.0%
Retail Retail committed occupancy at 97.0%(1) Above Singapore retail occupancy rate of 91.5%(2) for 2Q 2021 based on URA’s island- wide retail space vacancy rate 99.9%99.9% 99.4%100.0% 98.4%97.3% 99.9%99.9% 99.0%97.9% 99.3% 99.1% 99.2% 99.7% 98.2% 96.9% 97.1%98.0% 98.7% 98.0% 96.9% 97.3% 94.2% 94.2%
Slide 26: 1H 2021 rental reversion decline rate eased compared to 2H 2020
Retail 1H 2021 rental reversion decline rate eased compared to 2H 2020 From 1 January to 30 June 2021 (Excluding Newly Created and Reconfigured Units) (1) Net Lettable Area Change in Incoming Year 1 Rents vs No. of Renewals / Retention Rate Properties Percentage of Outgoing Final Rents (typically Ne
Slide 27: Retail lease expiry profile
Retail Retail lease expiry profile(1) Weighted Average Lease Expiry By Monthly Gross Rental Income 1.9 Years Total Retail Portfolio Lease Expiry Profile as at 30 June 2021 34.5% 6.9% 23.7% 20.2% 16.2% 12.6% 4.7% 4.3% 2021 2022 2023 2024 2025 2026 and beyond Completed Under Negotiation Gross Rental I
Slide 28: Tenants' sales continues to outpace shopper traffic in 1H 2021
Retail Tenants’ sales continues to outpace shopper traffic in 1H 2021 Recovery Progress Recovery levels for tenants’ sales and shopper traffic at CICT retail portfolio vs average for 2019 Comparing 1H 2021 150% Suburban Dow ntow n information with (1) 2019 Portfolio average and (2) year-on- Mall Mal
Slide 29: 1H 2021 tenants' sales improved Y-o-Y on low base effect
Retail 1H 2021 tenants’ sales improved Y-o-Y on low base effect Top five trade categories(1) : 1H 2021 tenants’ sales $ psf / month(2) 4.3% Y-o-Y (by gross rental income for retail segment) Percentage of total retail gross rental income(3) > 68% 46.6% 1H 2021 Tenants’ Sales by Trade Categories Y-o-Y
Slide 30: Office performance overview
Office Office performance overview Singapore and Germany office assets Increase in leasing enquiries for relocation and consolidation Q-o-Q(4) Office Total New and Renewal Leases (sq ft) Occupancy(1) 6% 186,100 10% 2% 21% 93.0% 2Q 2021 42% 18% as at 30 Jun 2021 (New leases: 25.9%(2)) 55% 46% Singapo
Slide 31: Occupancy rate of office portfolio at 93.0%
Office Occupancy rate of office portfolio at 93.0% Occupancy for Singapore: Occupancy for Germany: CICT’s office portfolio: 92.4% CICT’s portfolio: 95.5% (4) CBRE SG Core CBD: 92.1% Frankfurt Market: 93.3% 97.4% 96.0% 96.8% 96.8% 100.0% 100.0% 97.9% 96.9% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 95
Slide 32: Office rents committed above market levels
Office Office rents committed above market levels Market Rents of Average Committed Comparative Sub-Market (S$) Building Expired Rents Rents in 2Q 2021 Sub-Market (S$) (S$) Cushman & (1) Knight Frank(2) Wakefield Grade A Asia Square Tower 2 12.01 11.10 – 13.00 9.54 9.00 – 9.50 Raffles Place Grade A
Slide 33: Proactively engaged with tenants to manage their requirements
Office Proactively engaged with tenants to manage their requirements Weighted Average Lease Expiry 2.7 Years By Monthly Gross Rental Income Total Office Portfolio (1) Lease Expiry Profile as at 30 June 2021 0.2% 0.1% 27.0% 24.6% 18.4% 18.0% 15.2% 15.6% 18.5% 13.7% 13.1% 26.1% 26.8% 11.5% 6.9% 7.7% (
Slide 34: Addressing tenant space and leasing requirements with flexibility and optionality
Office Addressing tenant space and leasing requirements with flexibility and optionality 2Q 2021 Grade A office market rent at S$10.50 psf per month (1) 2021 (2) Average rent of leases expiring is S$10.11 psf 20% 16 13.49 11.55 15% 10.28 12 8.41 10% 8 5% 4 3.1% 3.2% 2.3% 0.8% 0% 0 Asia Square Tower
Slide 35: Continue to proactively manage major leases and backfill space
Office Continue to proactively manage major leases and backfill space 2022 2023 (1) (1) Average rent of leases expiring is S$9.19 psf Average rent of leases expiring is S$11.03 psf 20% 16 20% 16 12.19 11.87 11.03 11.32 11.12 15% 12 15% 10.71 12 8.56 10% 8 10% 8 6.16 5.0% 4.6% 5% 4 5% 3.9% 3.7% 4 3.3
Slide 36: Occupancy rate of Integrated Developments at 96.5%
Integrated Development Occupancy rate of Integrated Developments at 96.5% 93.6% 99.0% 98.4% 98.5% 97.9% 92.8% Raffles City Singapore (1) Funan (2) Plaza Singapura & The Atrium@ Orchard(3) As at 31 March 2021 As at 30 June 2021 Notes: (1) Retail occupancy is 92.3% and office occupancy is 95.1% as at
Slide 37: Lease expiry profile as at 30 June 2021
Integrated Development Lease expiry profile(1) as at 30 June 2021 Weighted Average Expiry 5.0 Years by Monthly Gross Rental Income 23.9% 3.4% 16.7% 10.1% 10.4% 10.3% 9.0% Retail 5.3% 6.5% 3.6% 4.3% 3.3% 2.2% 0.5% 0.4% Office 2021 2022 2023 2024 2025 2026 and beyond Retail Office Hospitality Under Ne
Slide 38: Creating Value
Creating Value Artist’s Impression of CapitaSpring
Slide 39: Ongoing AEIs on track to complete in 2H 2021
Ongoing AEIs on track to complete in 2H 2021 Work in progress for plans to reposition other assets SIX BATTERY ROAD 21 COLLYER QUAY ✓ 7-year lease to WeWork: ✓ Space handed ov er to tenant ✓ Lease to commence in late 2021 ✓ Achieved BCA Green Mark Platinum LOT ONE SHOPPERS’ MALL New retail banking h
Slide 40: Refreshing retail experiences in 2Q 2021
Refreshing retail experiences in 2Q 2021 ELEMIS at Raffles City Singapore Superga at Tampines Mall CHICHA San Chen at Lot One Shoppers’ Mall Marutama Ramen at Bugis+ OPPO at Bugis Junction Milkfish at Raffles City Singapore 40
Slide 41: Strengthening our omnichannel retail ecosystem through CapitaStar
Strengthening our omnichannel retail ecosystem through phygital engagements with CapitaStar Support tenants’ marketing channels and 1 More than Popular Malls Favourite Brands address evolving shoppers’ preferences 1.1 Million • Bugis Junction • BHG • CapitaStar platform enabled tenants to have Capit
Slide 42: Supporting tenants through eCapitaMall & Capita3Eats
Supporting tenants through eCapitaMall & Capita3Eats More than 600 brands are now onboard since launch in June 2020 • eCapitaMall & Capita3Eats reported growth in Gross Merchandise Value (GMV) by 2.5X and 2.8X respectively during Phase 2 (Heightened Alert) from 16 May to 13 June 2021 • Waiver of pla
Slide 43: Engaging the community via CapitaLand staff volunteer programmes
Engaging the community via CapitaLand staff volunteer programmes Since March this year, CapitaLand’s philanthropic arm, CapitaLand Hope Foundation has rallied close to 150 CapitaLand staff to deliver meals to vulnerable seniors as part of its #LoveOurSeniors initiative 43 43
Slide 44: Looking Forward
_——_a Looking Forward a aa \
Slide 45: CICT to enhance its resilient ecosystem amidst uncertainties
CICT to enhance its resilient ecosystem amidst uncertainties In persisting market uncertainties, CICT will continue to: • Be agile and flexible in managing our portfolio • Deepen stakeholder engagement Focus of CICT to • Provide tenants with the appropriate targeted support enhance the • Leverage te
Slide 46: CICT's value creation strategy
CICT’s value creation strategy To deliver stable distributions and sustainable returns to unitholders • Investing through property market cycles and across geographies • Undertaking appropriate divestment of assets that have reached their optimal • Singapore, Germany and other life cycle developed m
Slide 47: Market Information
Market Information CapitaGreen
Slide 48: CICT Market Share
Retail CICT Market Share Largest owner of private retail stock in Singapore(1) CICT, 9.2% Frasers Centrepoint Trust, 4.4% Mercatus, 4.3% Far East Organization, 3.3% Lendlease, 3.0% Mapletree Commercial Trust, 2.4% City Developments Limited, 2.2% Others/Unknown, 65.3% Changi Airport Group, 2.0% Unite
Slide 49: Limited retail supply between 2021 and 2024
Retail Limited retail supply between 2021 and 2024 • Total retail supply in Singapore averages approximately 0.4 million sq ft (2021 - 2024), significantly lower than: ― Last 3-year historical annual average supply (2018 - 2020) of 0.86 million sq ft ― Last 5-year historical annual average supply (2
Slide 50: Known future retail supply in Singapore (2021 – 2024)
Retail Known future retail supply in Singapore (2021 – 2024) None of the seven new projects with more than 100,000 sq ft NLA are located in Downtown Expected Proposed Retail Projects Location NLA (sq ft) completion 2021 Grantral Mall @ Macpherson (Citimac A&A) Macpherson Road 67,500 2021 Shaw Plaza
Slide 51: Suburban rents rose by 1% while Orchard rents declined by 1% Q-o-Q
Retail Suburban rents rose by 1% while Orchard rents declined by 1% Q-o-Q in 2Q 2021 Singapore Retail Rents and Quarterly GDP Growth 15.0% $40.00 $35.00 10.0% $30.00 5.0% $25.00 0.0% $20.00 $15.00 -5.0% Q1 2011 Q2 2012 Q3 2013 Q4 2014 Q1 2016 Q2 2017 Q3 2018 Q4 2018 Q4 2019 Q1 2020 Q1 2021 Q2 2021 Q
Slide 52: Singapore retail sales performance
Retail Singapore retail sales performance Retail sales on a positive trajectory (S$ billion) 4.0 30.0% 3.5 3.6 3.5 3.1 3.2 25.0% 26.2% 3.0 2.9 2.9 2.8 2.8 2.8 2.8 2.8 2.8 2.6 21.0% 2.7 20.0% 20.0% 2.5 2.3 16.1% 2.0 16.3% 2.0 15.0% 1.7 12.4% 14.4% 13.3% 1.5 12.7% 13.4% 11.7% 12.6% 12.5% 12.0% 10.0% 1
Slide 53: Singapore office stock as at end 1Q 2021
Office - Singapore Singapore office stock as at end 1Q 2021 Island-wide office stock Singapore Stock % of Grade A office (sq ft) total Core CBD Decentralised, Core CBD, stock 23.38% 50.58% Core CBD 31.2 mil 50.58% 14.1 mil sq ft (45.28% of Core CBD stock) Fringe CBD 16.1 mil 26.05% Decentralised 14.
Slide 54: Annual new supply averages 0.8 mil sq ft over 5 years
Office - Singapore Annual new supply averages 0.8 mil sq ft over 5 years; CBD Core occupancy at 92.1% as at end-June 2021 Singapore Private Office Space (Central Area) (1) – Net Demand & Supply 2.5 2.2 Forecast average annual gross new supply 1.9 (2021 to 2025): 0.8 mil sq ft 2.0 1.8 1.9 1.6 1.6 1.7
Slide 55: Known future office supply in Central Area (2021 – 2024)
Office - Singapore Known future office supply in Central Area (2021 – 2024) No commercial sites(1) on Government Land Sales Confirmed List (10 Jun 2021); Two white sites(2) on reserve list, namely Kampong Bugis and Woodlands Ave 2 (Fringe Area) Expected Proposed Office Projects Location NLA (sq ft)
Slide 56: Grade A office rent rose Q-o-Q in 2Q 2021
Office - Singapore Grade A office rent rose Q-o-Q in 2Q 2021 1Q 19 2Q 19 3Q 19 4Q 19 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 2Q 21 Mthly rent (S$ / sq ft ) 11.15 11.30 11.45 11.55 11.50 11.15 10.70 10.40 10.40 10.50 change 3.2% 1.3% 1.3% 0.9% -0.4% -3.0% -4.0% -2.8% 0% 1.0% $20 S$18.80 $18 Monthly gross rent
Slide 57: Information on Frankfurt and two submarkets
Office - Germany Information on Frankfurt and two submarkets ('000 sqm) Frankfurt Office (%) 800.0 16.0 700.0 14.0 600.0 12.0 500.0 10.0 400.0 8.0 6.7 300.0 6.0 200.0 4.0 100.0 2.0 0.0 0.0 2015 2016 2017 2018 2019 2020 YTD June 2021 Demand ('000 sqm) New Supply ('000 sqm) Vacancy rate (%) Banking Di
Slide 58: New office supply in Frankfurt
Office - Germany New office supply in Frankfurt About 68% and 35% of 2021F and 2022F new supply are owner-occupied or committed (‘000 sq m) 300 Actual New Supply Forecast New Supply 250 200 5-Year (2016-2020) Average: 145,960 sq m 150 100 50 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021F 2022F
Slide 59: Rental range in Frankfurt
Office - Germany Rental range in Frankfurt Rental range by submarket Frankfurt West City CBD (€ / square metre / month) C Westend B 44.0 44.0 D Gallileo 41.73 Banking 27.0 District 23.36 19.93 A5 B43 Niederrad South 18.0 22.0 7.0 MAC A3 Frankfurt Frankfurt Airport Office Frankfurt Total Banking Dist
Slide 60: Thank you
Thank you For enquiries, please contact: Ms Ho Mei Peng, Head, Investor Relations Direct: (65) 6713 3668 | Email: ho.meipeng@capitaland.com CapitaLand Integrated Commercial Trust Management Limited (http://www.cict.com.sg) 168 Robinson Road, #25-00 Capital Tower, Singapore 068912 Tel: (65) 6713 2888
Slide 61: Additional Information
Additional Information Bugis Junction
Slide 62: 1H 2021 gross revenue
1H 2021 gross revenue(1) Majority of the portfolio registered year-on-year increase 97.7 93.1 (S$ m) 50.7 46.9 42.7 40.2 38.3 36.1 36.9 34.9 35.0 30.9 28.4 31.3 28.4 31.5 26.5 30.3 27.5 23.8 26.2 23.8 22.5 22.4 21.8 19.3 19.1 16.0 14.4 14.5 12.6 13.7 13.2 ( 2) 6.9 4.3 ( 5) Other Assets (3) (4) Funan
Slide 63: 1H 2021 operating expenses
1H 2021 operating expenses(1) Higher operating expenses mainly from higher property management fees and property management reimbursements excluding effects of the merger 23.4 (S$ m) 22.1 11.8 12.0 11.6 10.0 9.9 10.8 9.7 10.2 9.3 9.6 9.5 9.9 9.2 7.9 7.7 7.8 8.7 7.5 7.7 6.7 6.5 6.7 5.8 6.2 5.6 5.2 5.
Slide 64: 1H 2021 net property income
1H 2021 net property income(1) 75.6 (S$ m) 69.7 39.1 37.7 30.7 28.1 29.4 24.3 27.0 25.0 26.3 20.7 21.3 21.9 20.8 21.2 19.7 19.1 18.7 20.8 16.3 15.1 16.1 16.8 16.6 13.1 11.2 10.2 9.6 12.0 8.9 8.3 8.5 ( 2) 2.7 1.7 Raffles City Singapore (4) Other Assets (3) Asia Square Tower 2 Clarke Quay Funan Capita
Slide 65: CapitaSpring - Development for Future Growth
CapitaSpring- Development for Future Growth CapitaSpring has drawn down S$60.0 mil in 2Q 2021 – CICT’s 45.0% share amounts to S$27.0 mil CICT’s 45% interest in Drawdown (2) Glory Office Trust and Balance as at Jun 2021 Glory SR Trust Debt at Glory Office Trust and Glory SR S$531.0m (S$486.0m) S$45.0
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