Frasers Property Ltd. · SGX:TQ5

Frasers Property — Frasers Commercial Trust — 3QFY17 Earnings Presentation

33 slides from Frasers Property's earnings presentation, Jul 24, 2017

  1. Slide 1: Frasers Commercial Trust 3QFY17 Financial Results

    Frasers Commercial Trust 3QFY17 Financial Results 24 July 2017

  2. Slide 2: Important notice

    Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual resu

  3. Slide 3: Contents

    Contents 3  Results  Portfolio Review  Capital Management  Appendix: Markets Overview

  4. Slide 4: Results

    Results FRASERS COMMERCIAL

  5. Slide 5: Results – 3QFY17 Key highlights

     Results – 3QFY17 Key highlights 5  Distribution income rose 0.9% y-o-y to $19.2 million in 3QFY171  Better performance by Australian portfolio as a result of stronger Australian dollar, offset by lower occupancy rates for Alexandra Technopark, China Square Central and Central Park Distributable

  6. Slide 6: Results – 3QFY17 Financial highlights

     Results – 3QFY17 Financial highlights 6  0.9% y-o-y rise in Distributable Income  1.5% y-o-y rise in Net Property Income (cash basis) 1 Apr 2017 – 30 Jun 3QFY17 Y-o-Y Contributing factors 2017 (S$ ‘000) Change (%)  Higher revenue contribution from 357 Collins Street due to higher rental rates a

  7. Slide 7: Results – 3QFY17 Financial highlights

     Results – 3QFY17 Financial highlights 7 Better performance by Australian portfolio as a result of average stronger Australian dollar, offset by lower occupancy rates for Alexandra Technopark, China Square Central and Central Park Net Property Income (S$m) TOTAL: S$27.9 million for 3QFY17 Singapore

  8. Slide 8: Results – Financial highlights

     Results – Financial highlights 8  3QFY17 DPU stable y-o-y as higher distributable income was offset by an increase in number of Units1  Approximately 12.0% management fees were taken in Units2 in 3QFY17 DPU (Cents) 9.82 cents 1 The number of Units used to calculate the amount available for DPU a

  9. Slide 9: Results – Distribution payment

     Results – Distribution payment 9 DRP will be applied for the distribution for 3QFY17 Distribution Period 1 April 2017 to 30 June 2017 Distribution of 2.3979 cents per Unit comprising: a) taxable income distribution of 1.5391 cents; Ordinary Unit Distribution Rate b) tax-exempt income distribution

  10. Slide 10: Portfolio Review

    Portfolio Review

  11. Slide 11: Portfolio review – Valuation

     Portfolio review – Valuation 11  Balanced portfolio of Singapore and Australian properties  No one property accounts for more than 28% of portfolio value Singapore Asset values as at 30 June 2017 Perth Canberra Singapore $ 1,211.4 mil 61% Melbourne Australia $ 786.8 mil 39% Total $ 1,998.2 mil 1

  12. Slide 12: Portfolio review – Occupancy Rates & WALE

     Portfolio review – Occupancy Rates & WALE 12  Healthy average committed occupancy rate of 92.6%1  Improvement from 91.8%2 in preceding quarter  Healthy WALE of 3.4 years1,3 Geographical occupancy and % NPI contribution As at Key portfolio statistics 30 June 2017 Ave Committed Occupancy1 92.6% P

  13. Slide 13: Portfolio review – Lease expiry profile

     Portfolio review – Lease expiry profile 13 Well-spread lease expiry profile provides income stability Lease expiries in FY17 and FY18 Lease expiry in FY21 and reduced by 7.2% mainly due to the beyond increased to space committed by an entity of Rio 35.7% mainly due to the Tinto Limited for 12 year

  14. Slide 14: Portfolio review – Lease expiry profile

     Portfolio review – Lease expiry profile 14 Proactive management of leases Lease expiries for the Singapore properties reduced by 1.7% with committed leases Includes 5.6% for Property Lease Expiry in FY17 Hewlett-Packard as a proportion of Portfolio Enterprise lease at Gross Rental Income Alexandra

  15. Slide 15: Portfolio review – Rental reversions

     Portfolio review – Rental reversions 15 2.5%1 average negative rental reversion for new/renewed leases totaling c.51,000 sf that commenced in 3QFY17 China Square Central: Alexandra Technopark: - 2.6%2 0% (for c. 45,700 sf) (for c.5,200 sf) 1 Income-weighted average reversion rate for new/renewed l

  16. Slide 16: Portfolio review – Leasing activities

     Portfolio review – Leasing activities 16  Healthy levels of leasing activities and market interest  Selected new/renewed leases in 3QFY17: Tenant Industry Property OCBC Property Services Pte Ltd Real estate services China Square Central Banjaran Asset Management Financial services China Square C

  17. Slide 17: Portfolio review – Mid-term rent reviews

     Portfolio review – Mid-term rent reviews 17 17 55% of FY17 leases have built-in step-up rents FY17 – 20 - Portfolio fixed % reviews GROSS RENTAL INCOME1 Average Total Property Leases step-up rent Property Portfolio China Square 3 1.5% 18.9% 3.4% Central 55 Market Street 2 0.7% 10.7% 0.4% Alexandra

  18. Slide 18: Portfolio review – Stability of income

     Portfolio review – Stability of income 18 Top 10 tenants:  MNCs, government department and public listed companies  Established names and well diversified across various sectors  Contribute 60% of portfolio gross rental income and have a long WALE of 4.5 years as at 30 June 2017 Top 10 tenants

  19. Slide 19: Asset updates – Developments at China Square Central

     Asset updates – Developments at China Square Central 19  Construction works for the development of the 16-storey Hotel and Commercial Project1 are on track and expected to be completed by mid-2019  New retail and commercial spaces with better frontage and visibility will also be created2  The H

  20. Slide 20: Asset updates – Asset enhancement at Alexandra Technopark

     Asset updates – Asset enhancement at Alexandra Technopark 20  Construction works for the rejuvenation and re-positioning of Alexandra Technopark commenced in 1Q 2017  Works for the $45 million AEI are on track and are expected to be completed around mid-2018  Creating more community-friendly sp

  21. Slide 21: Portfolio review – Singapore assets update

     Portfolio review – Singapore assets update 21 China Square Central – healthy 55 Market Street – Alexandra Technopark – occupancy at office tower healthy occupancy rate healthy occupancy rate Occupancy 80.8% (office tower: 93.6%)* 93.2%^ 94.8%^ WALE 1.7 years 1.1 years 1.1 years New leases, OCBC Pr

  22. Slide 22: Portfolio review – Australia asset updates

     Portfolio review – Australia asset updates 22 Caroline Chisholm Centre 357 Collins Street – full Central Park – Long WALE of 5.9 – full occupancy with occupancy in a strong years* long WALE of 8.0 years market Occupancy 82.3* 100.0% 100.0% WALE 1.6 years (5.9 years with new lease*) 8.0 years 3.9 y

  23. Slide 23: Capital Management

    Capital Management FRASERS COMMERCIAL

  24. Slide 24: Capital Management – Debt statistics

    24  Capital Management – Debt statistics 24  Healthy gearing of 35.9%  Healthy interest coverage ratio of 4.4 times  Borrowings in AUD provide natural hedge for the Australian properties Statistics Borrowings and assets by currency As at 30 June 2017 Total Assets (S$’000) 2,078,721 Gross Borrowi

  25. Slide 25: Well-Spread Debt Expiry Profile

    25  Well-Spread Debt Expiry Profile 25  Well-spread debt maturity profile  No debt maturing until August 2018  Debt expiring in any one financial year no more than S$182 million  91% of gross borrowings on fixed rate Debt maturity Debt composition – floating vs. fixed interest rates Total facil

  26. Slide 26: Appendix: Markets Overview

    Appendix: Markets Overview FRASERS COMMERCIAL

  27. Slide 27: Solid fundamentals - Singapore office rents

     Solid fundamentals - Singapore office rents 27 Singapore office:  Grade B rents relatively more stable  Q2 2017 rents have stabilised and likely to represent a trough Singapore Grade A and Grade B office rents1 Grade A CBD Core Stable qoq at S$8.95 psf Grade B CBD Core Stable qoq at S$7.25 psf G

  28. Slide 28: Solid fundamentals - demand, supply and outlook for Singapore CBD office

     Solid fundamentals - demand, supply and outlook for Singapore CBD office 28 Office supply-demand dynamics1  Q2 2017 total island-wide office net absorption was healthy at 923,810 sf  Island-wide vacancy edged up slightly by 0.5% points qoq to 6.6% in Q2 2017  Concerns over new supply have dimin

  29. Slide 29: Solid fundamentals - Singapore business park rents

     Solid fundamentals - Singapore business park rents 29 Singapore business parks – City fringe business park rents remained stable in Q2 20171 Singapore Business Park (city fringe) rents1 Source: CBRE Research 1 CBRE, Singapore Market View, Q2 2017

  30. Slide 30: Solid fundamentals - demand, supply and outlook for Singapore business park

     Solid fundamentals - demand, supply and outlook for Singapore business park 30 Business Park supply-demand dynamics1  Business park island-wide vacancy rose slightly by 0.3% points qoq to 11.9% due to 72,320 sf negative net absorption in Q2 2017  Leasing activities and enquiries have been slow i

  31. Slide 31: Perth CBD office supply and rents

     Perth CBD office supply and rents 31  Prime Grade average net face rents range between A$528 to A$629 per sqm per annum as at January 2017, with incentives around 35% to 50%  Prime Grade rents appear to be reaching a trough  As at January 2017, Prime Grade office vacancy of 19.1% was below the

  32. Slide 32: Melbourne CBD office supply and rents

     Melbourne CBD office supply and rents 32  118,000 sqm net absorption in 2016 for the Melbourne CBD office market, and demand is expected to remain robust throughout 2017 and 2018  6.4% vacancy rate in June 2017 expected to decline to 4.2% by mid-2018 given tight supply and strong demand  Q1 201

  33. Slide 33: Thank you

    Thank you Frasers Centrepoint Asset Management (Commercial) Limited 438 Alexandra Road | #21-00| Alexandra Point | Singapore 119958 Tel: +65 6276 4882| Fax: +65 6276 8942| Email: fcot@fraserscentrepoint.com www. fraserscommercialtrust.com

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