Keppel REIT · SGX:K71U
Keppel REIT — K-REIT Asia — Investor Presentation (November 2010)
31 slides from Keppel REIT's investor presentation, November 2010
Slide 1: Investor Presentation
Investor Presentation November 2010
Slide 2: Important notice
Important notice The past performance of K-REIT Asia 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-looking” statements due to a number of risks, uncertainties and assumptio
Slide 3: K-REIT Asia Overview
Section 1 K-REIT Asia Overview 3
Slide 4: Singapore's leading office REIT
Singapore’s leading office REIT Vision: To be the office real estate investment trust of choice renowned for its sterling portfolio of pan-Asian assets. Listed on the SGX-ST in April 2006 with a market cap of S$1.8bn1 as at 29 October 2010 Quality portfolio of 6 prime commercial properties Sig
Slide 5: Portfolio of quality commercial assets post transaction
Portfolio of quality commercial assets post transaction 1. One Raffles Quay, Singapore 2. Marina Bay Financial Centre, Singapore 3. Prudential Tower, Singapore 4. 275 George Street, 2. 3. Brisbane, Australia 5. 77 King Street, Sydney, Australia 6. Bugis Junction Towers, Singapore 5
Slide 6: Portfolio of quality assets
Portfolio of quality assets As at 30 September 2010 77 King Street2 275 George Street One Raffles Quay Attributable NLA (sf) 147,756 224,686 445,120 Ownership 100% 50.0% 33.3% Number of tenants 15 8 31 99 years expiring Tenure Freehold Freehold 12 Jun 2100 S$145m S$209m S$935m Valuation1 (S$985 psf)
Slide 7: Portfolio of quality assets (cont'd)
Portfolio of quality assets (cont’d) Keppel Towers and As at 30 September 2010 Prudential Tower Bugis Junction Towers GE Tower (KTGE) Attributable NLA (sf) 175,672 246,259 430,112 Ownership 73.4% 100.0% 100.0% Number of tenants 26 10 66 99 years expiring 99 years expiring Tenure Freehold 14 Jan 2095
Slide 8: Our strategy
Our strategy Disciplined Acquisition Prudent Capital Active Asset Growth Management Management Pursue value accretive Manage assets and Attract creditworthy acquisition opportunities cost structure tenants to increase in Singapore and pan-Asia more effectively occupancy as well as retain good
Slide 9: Key milestones
Key milestones 2 Nov 2009 1 Mar 2010 19 Jul 2010 11 Oct 2010 Acquired additional Acquired 50% Announced Announced proposed strata lots in interest in 275 acquisition of acquisition of one- Prudential Towers George Street, 77 King Street office third stake in MBFC from 44% to 73% Brisbane, Australia
Slide 10: Strong Keppel Land sponsorship
Strong Keppel Land sponsorship Leading development expertise Ocean MBFC Phase 2(1) 1 Financial Centre(1) Leading property developer having successfully completed multiple landmark commercial developments 2 Strong alignment with K-REIT Asia’s Unitholders Anchor stake of approx. 45% Injection of
Slide 11: Singapore Overview
Section 2 Singapore Overview 11
Slide 12: Singapore is one of Asia's leading economies with robust macro economic fundamentals
Singapore is one of Asia’s leading economies with robust macro economic fundamentals Forecast 2010 GDP Growth Estimates (%) Singapore’s global recognition is reflected in consistent 14 12.2 high rankings in competitiveness rankings: 12 9.9 No.1 in IMD’s World Competitiveness Scoreboard 2010 9.2
Slide 13: Singapore office rents are inexpensive in a global context but continue to strengthen
Singapore office rents are inexpensive in a global context but continue to strengthen 200 CBRE Global Office Rents (US$PSF PA) 182.9 160 Based on CBRE’s latest Global Office Rents 153.2 report, Singapore has dropped from the 32nd 144.0 120 125.8 125.1 118.4 113.2 most expensive office market globa
Slide 14: Acquisition of a one-third interest in Marina Bay Financial Centre and Divestment of Keppel Towers & GE Tower
Section 3 Acquisition of a one-third interest in Marina Bay Financial Centre Towers 1 and 2 and Marina Bay Link Mall and Divestment of Keppel Towers & GE Tower 14
Slide 15: Transaction summary
Transaction summary Keppel Land’s one-third interest in MBFC Towers 1 & 2 (MBFC Property) and Proposed Acquisition Marina Bay Link Mall – purchase consideration of S$1,427m, including an income support of up to S$29m To divest Keppel Towers & GE Tower (KTGE) to Proposed Divestment Keppel Land fo
Slide 16: Rationale: Optimising and upgrading K-REIT Asia's portfolio
Rationale: Optimising and upgrading K-REIT Asia’s portfolio Increased exposure to Grade A office in Raffles Place and new downtown MBFC Phase 1 (prime Grade A office asset) located in Marina Bay Located alongside existing property – One Raffles Quay Limited known supply of office properties ex
Slide 17: MBFC: The premier office asset in Singapore
MBFC: The premier office asset in Singapore A prestigious landmark commercial development Acquisition comprises Marina Bay Financial Centre Towers 1 & 2 and the retail Marina Bay Link Mall Strategically located in Singapore’s new financial district Close proximity to the newly developed Marina
Slide 18: Joint ownership structure with established real estate managers
Joint ownership structure with established real estate managers(1) Cheung Kong Holdings Ltd / Hong Kong Land Hutchison Whampoa(2) 33.3% 33.3% 33.3% BFC Development Pte. Ltd. MBFC Tower MBFC Tower 1 2 1. Upon completion of the Transaction. 2. On 26 October 2010, Suntec REIT announced its proposed acq
Slide 19: Key Benefits of Transaction
Section 4 Key Benefits of Transaction 19
Slide 20: Key benefits of the Transaction
Key benefits of the Transaction Enhance portfolio distribution to Unitholders1 Improve Upgrade balance sheet property efficiency portfolio and flexibility The DPU accretive Transaction will: Improve Enhance portfolio cashflow fundamentals resilience 1. Based on the assumptions set out in K-REIT Asia
Slide 21: Optimising and upgrading property portfolio
1 Optimising and upgrading property portfolio Acquisition of super prime Grade A property in core Singapore CBD area One Raffles Quay MBFC Tower 1 MBFC Tower 2 Marina Bay Sands integrated resort MBFC Phase 1 Marina Bay Suites Marina Bay MBFC Tower 3 Residences Located in Marina Bay which is envisa
Slide 22: Optimising and upgrading property portfolio
1 Optimising and upgrading property portfolio Positive rebalancing of portfolio K-REIT Asia’s Singapore property portfolio in Raffles Place and Marina Bay increases from 60% to 90% post-Transaction (based on assets under management) Key locations for “front offices” of leading multi-national cor
Slide 23: Optimising and upgrading property portfolio: Delivering on growth strategy
1 Optimising and upgrading property portfolio Delivering on growth strategy Significantly increases scale of K-REIT Asia’s portfolio Reinforces strategy to invest in the top office properties in hard to access markets with attractive fundamentals to support continued capital appreciation Illus
Slide 24: Enhances cashflow resilience and improves portfolio fundamentals
Enhances cashflow resilience and improves portfolio 2 fundamentals Blue-chip tenant base with committed occupancy MBFC Property Committed Occupancy Long and staggered weighted 100% 96% 96% average lease expiry of 10.3 years 90% 87% Top ten tenants occupy 90% of Cccpancy (%) 80% leased NLA 70% 60
Slide 25: Enhances cashflow resilience and improves portfolio fundamentals
Enhances cashflow resilience and improves portfolio 2 fundamentals Well-balanced portfolio lease expiry and rent review profile As at 30 September 20101 17.4% 13.4% 14.1% 9.3% 8.8% 7.8% 4.4% 3.1% 0.3% 0.0% 2010 2011 2012 2013 2014 Post-Transaction2 13.8% 12.9% 10.3% 7.8% 7.8% 5.8% 6.4% 2.0% 0.2% 0.0
Slide 26: Enhances cashflow resilience and improves portfolio fundamentals
Enhances cashflow resilience and improves portfolio 2 fundamentals Improved lease expiry profile post-Transaction Portfolio Lease Terms by Net Lettable Area Long-term Short- leases 3 term 36.0% leases 36.0% Short-term Long-term leases leases3 64.0% 64.0% As at 30 Sep 20101 Post-Transaction2 Portfoli
Slide 27: DPU accretive Transaction
3 DPU accretive Transaction 10% growth in DPU in FY 2011 S$ Cents 7.0 Growth: 10.2% 6.68 Cents 6.5 6.42 Cents 6.06 Cents 6.0 5.5 5.0 Existing portfolio2 Existing portfolio plus 77 King Street Portfolio post Transaction 3 Office Tower 1. Based on the assumptions set out in the Manager’s announcement
Slide 28: Improves balance sheet efficiency and flexibility
4 Improves balance sheet efficiency and flexibility All-in cost of borrowings from 3.4% to approximately at 3.05% post-Transaction Debt maturity profile is well-balanced and staggered post-Transaction Debt weighted term to maturity increased from 1.4 years to 4.1 years No immediate refinan
Slide 29: K-REIT Asia Investment Highlights
Section 5 K-REIT Asia Investment Highlights 29
Slide 30: Attractive investment proposition
Attractive investment proposition Leading pure-play commercial REIT High quality portfolio with blue-chip tenants Proven organic growth and acquisition track record Strong sponsorship commitment from Keppel Land 30
Slide 31: Thank You
Thank You For enquiries, please contact Ms Casiopia Low Investor Relations & Research Tel: 6433 7622 Fax: 6835 7747 Email: casiopia.low@kreitasia.com http://www.kreitasia.com 31