Oue Real Estate Investment Trust · SGX:TS0U
Oue Real Estate Investment Trust — OUE Commercial REIT — Q4 2016 Earnings Presentation
38 slides from Oue Real Estate Investment Trust's earnings presentation, Jan 26, 2017
Slide 1: Financial Results for 4th Quarter 2016 and Year Ended 31 December 2016
Financial Results for 4th Quarter 2016 and Year Ended 31 December 2016 26 January 2017
Slide 2: Important Notice
Important Notice This presentation shall be read in conjunction with OUE Commercial REIT’s Financial Results announcement for 4Q 2016 dated 26 January 2017. This presentation is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for units in OUE Com
Slide 3: Agenda
Agenda Key Highlights Financial Performance and Capital Management Portfolio Performance Outlook Appendices 3
Slide 4: Key Highlights
Key Highlights Financial Highlights Higher 4Q 2016 revenue and net property income of S$45.0 million and S$34.8 million respectively due mainly to contribution from One Raffles Place Excluding One Raffles Place, organic growth in net property income of the portfolio (i.e. OUE Bayfront and Lippo
Slide 5: Key Highlights
Key Highlights Capital Management Aggregate leverage as at 31 December 2016 was 39.8% with a weighted average cost of debt of 3.6% p.a. As at 31 December 2016, 79.3% of borrowings were on fixed rate basis, with an average term of fixed rate debt of 2.5 years Refinanced RMB onshore loan in July
Slide 6: Financial Performance & Capital Management
Financial Performance & Capital Management
Slide 7: Delivered Sustainable Distribution
Delivered Sustainable Distribution Delivered sustainable distribution to Unitholders since IPO Distribution Since IPO (1) Period commencing from OUE C-REIT’s listing date of 27 January 2014 to 31 December 2014 (2) Compound annual growth rate (CAGR) computed on the basis of annualised amount availabl
Slide 8: 4Q 2016 vs 4Q 2015
4Q 2016 vs 4Q 2015 4Q 2016 4Q 2015 Change Revenue (S$m) 45.0 40.3 +11.6% Net Property Income (S$m) 34.8 29.7 +17.3% Amount Available for Distribution 15.4 17.6(1) -12.5% to Unitholders (S$m) DPU (cents) 1.18 1.36(1) -13.2% • Higher 4Q 2016 revenue of S$45.0 million was mainly due to improved perform
Slide 9: 4Q 2016 vs 4Q 2015
4Q 2016 vs 4Q 2015 S$'000 4Q 2016 4Q 2015 Change (%) Revenue 45,023 40,344 11.6 Property operating expenses (10,203) (10,666) (4.3) Net property income 34,820 29,678 17.3 Other income 482 2,154 (77.6) (1) Negative goodwill arising from acquisition of subsidiaries - 30,629 NM Amortisation of intangib
Slide 10: FY2016 vs FY2015
FY2016 vs FY2015 FY2016 FY2015 Change Revenue (S$m) 177.8 101.0 +76.0% Net Property Income (S$m) 138.6 75.6 +83.3% Amount Available for Distribution 67.4 56.1(1) +20.1% to Unitholders (S$m) DPU (cents) 5.18 4.38(1) +18.3% • Higher FY2016 revenue of S$177.8 million was mainly due to a full year’s con
Slide 11: FY2016 vs FY2015
FY2016 vs FY2015 S$'000 FY2016 FY2015 Change (%) Revenue 177,809 101,038 76.0 Property operating expenses (39,178) (25,399) 54.3 Net property income 138,631 75,639 83.3 Other income 2,552 8,347 (69.4) (1) Negative goodwill arising from acquisition of subsidiaries - 30,629 NM Amortisation of intangib
Slide 12: Distribution Details
Distribution Details Distribution Period 1 July 2016 to 31 December 2016 Distribution Per Unit 2.50 cents comprising (i) Taxable income distribution of 1.05 cents (ii) Tax-exempt income distribution of 1.20 cents (iiI) Capital distribution of 0.25 cents Notice of Books Closure Date 26 January 2017 E
Slide 13: Valuation as at 31 Dec 2016
Valuation as at 31 Dec 2016 Valuation(1) as at Valuation(2) as at Office Cap 31 December 2015 31 December 2016 Rate (S$ m) (S$ m) OUE Bayfront 1,146.0 1,146.0 3.75% One Raffles Place(3) 1,734.0 1,738.3 3.60% - 4.00% 523.2 524.2 Lippo Plaza N.A.(4) (RMB 2,401.0 m) (RMB 2,524.0 m) (1) Based on indepen
Slide 14: Healthy Balance Sheet
Healthy Balance Sheet S$ million As at 31 Dec 2016 Investment Properties 3,408.5 Total Assets 3,459.4 Loans and borrowings 1,303.7 Total Liabilities 1,490.6 Net Assets Attributable to Unitholders 1,206.8 Units in Issue (’000) 1,302,598 NAV per Unit (S$) 0.93 14
Slide 15: Debt Maturity Profile as at 31 Dec 2016
Debt Maturity Profile as at 31 Dec 2016 Refinanced RMB onshore loan in July 2016 ahead of maturity in 2017 with an eight-year term loan expiring in 2024 Secured refinancing for the Singapore dollar loans due in 2017 as well as 2019, ahead of maturity in January 2017, with a new five-year facilit
Slide 16: Capital Management
Capital Management Every 25bps increase in floating interest rates is expected to reduce distribution by S$0.7 million per annum, or 0.05 cents in DPU As at 31 Dec 2016 As at 30 Sep 2016 Aggregate Leverage 39.8% 40.8% Total debt S$1,261m(1) S$1,277m2) Weighted average cost of debt(3) 3.6% p.a. 3.4%
Slide 17: Portfolio Performance
Portfolio Performance
Slide 18: Portfolio Composition
Portfolio Composition By Asset Value(1) By Revenue Contribution(2) By Segment Revenue(2) (1) Based on independent valuations as at 31 December 2016 and OUE C-REIT’s proportionate interest in One Raffles Place (2) For 4Q 2016 and based on OUE C-REIT’s attributable interest in One Raffles Place 18
Slide 19: Resilient and Stable Portfolio
Resilient and Stable Portfolio OUE C-REIT’s Portfolio Committed Occupancy (1) Proforma committed occupancy as at 30 September 2013 as disclosed in OUE C-REIT’s Prospectus dated 17 January 2014 19
Slide 20: Office Occupancy In Line with Market
Office Occupancy In Line with Market Singapore Shanghai (1) Singapore Market Occupancy refers to Core CBD office occupancy for 4Q 2016 according to CBRE Research. Shanghai Market Occupancy refers to Shanghai Grade A office occupancy as at end-2016 according to Colliers International Shanghai 20
Slide 21: Improved Office Passing Rents
Improved Office Passing Rents Rental Reversions(1) Average Passing Rent 4Q 2016 Committed Rents(2) 4Q 2016 FY2016 Dec 2016 Dec 2015 OUE -14.1% -10.1% S$10.80 – S$12.30 psf/mth S$11.85 psf/mth S$11.75 psf/mth Bayfront One Raffles -9.8% -3.0% S$8.00 – S$11.50 psf/mth S$10.28 psf/mth S$10.26 psf/mth Pl
Slide 22: Lease Expiry Profile - Portfolio
Lease Expiry Profile - Portfolio WALE(1) of 2.5 years by NLA(2) and 2.6 years by Gross Rental Income As at 31 Dec 2016 (1) “WALE” refers to the weighted average lease term to expiry (2) “NLA” refers to net lettable area 22
Slide 23: Lease Expiry Profile - OUE Bayfront
Lease Expiry Profile - OUE Bayfront More than 70% of OUE Bayfront’s gross rental income is due only in 2019 and beyond WALE of 3.0 years by NLA and Gross Rental Income As at 31 Dec 2016 23
Slide 24: Lease Expiry Profile - One Raffles Place
Lease Expiry Profile - One Raffles Place Approximately 48.9% of 2017 renewals by gross rental income is attributable to retail income as One Raffles Place Shopping Mall was re-opened after a major refurbishment in 2014 WALE of 2.3 years by NLA and 2.1 years by Gross Rental Income As at 31 Dec 2016 2
Slide 25: Lease Expiry Profile - Lippo Plaza
Lease Expiry Profile - Lippo Plaza Significantly increased the weighted average lease expiry to 3.4 years by gross rental income compared to 2.8 years(1) a year ago, with leases that extend beyond 2023 WALE of 2.4 years by NLA and 3.4 years by Gross Rental Income As at 31 Dec 2016 (1) Based on OUE C
Slide 26: Quality and Diversified Tenant Base
Quality and Diversified Tenant Base Top 10 tenants contribute approximately 27.3% of gross rental income WALE by NLA 3.4 years As at 31 Dec 2016 26
Slide 27: Diversified Tenant Base
Diversified Tenant Base As at December 2016 27
Slide 28: Outlook
Outlook DOI a ‘all ll
Slide 29: Outlook and Prospects
Outlook and Prospects Singapore Singapore’s 2016 GDP growth was 1.8%(1), slowing from 2.0% in 2015, according to advance estimates by the Ministry of Trade and Industry (“MTI”). MTI’s GDP growth forecast for 2017 is 1.0% - 3.0% CBD Grade A office rents in Singapore contracted 2.2% QoQ to S$9.10(
Slide 30: Outlook and Prospects
Outlook and Prospects Outlook OUE C-REIT’s portfolio of strategically located Grade A office properties continue to record healthy occupancy levels which provide stability in income. Rental rates achieved at OUE C-REIT’s properties have been in line with, or above current market rates While the
Slide 31: Appendices
Appendices • Overview of OUE C-REIT • OUE C-REIT’s Portfolio • Singapore Office Market • Shanghai Office Market
Slide 32: Overview of OUE C-REIT
Overview of OUE C-REIT OUE C-REIT is a Singapore real estate investment trust listed on the Mainboard of Singapore Exchange Securities Trading Limited with the principal investment strategy of investing, directly or indirectly, in a portfolio of income-producing real About OUE C-REIT estate which
Slide 33: Premium Portfolio of Assets - OUE Bayfront
Premium Portfolio of Assets OUE Bayfront OUE Bayfront GFA (sq m) 46,774.6 Office: 35,342.7 NLA (sq m) Retail: 1,830.1 Overall: 37,172.8 Office: 97.7% Committed Occupancy Retail: 100.0% as at 31 Dec 2016 Overall: 97.8% Number of Car Park Lots 245 Valuation S$1,146.0 m (as at 31 Dec 2016) OUE Bayfront
Slide 34: Premium Portfolio of Assets - One Raffles Place
Premium Portfolio of Assets One Raffles Place One Raffles Place GFA (sq m) 119,628.5 Office (Tower 1): 29,070.0 Office (Tower 2): 27,045.0 Attributable NLA (sq m) Retail: 9,500.0 Overall: 65,590.0 Office: 92.2% Committed Occupancy Retail: 97.2% as at 31 Dec 2016 Overall: 93.0% Number of Car Park Lot
Slide 35: Premium Portfolio of Assets - Lippo Plaza
Premium Portfolio of Assets Lippo Plaza Lippo Plaza GFA (sq m) 58,521.5 Office: 33,538.6 Attributable NLA (sq m) Retail: 5,685.9 Overall: 39,224.5 Office: 94.5% Committed Occupancy Retail: 98.1% as at 31 Dec 2016 Overall: 95.0% Number of Car Park Lots 168 RMB2,524.0 m / RMB43,129 psm Valuation(1) (a
Slide 36: Singapore Office Market
Singapore Office Market Grade A office rents decreased 2.2% QoQ to S$9.10 psf/mth, while core CBD office occupancy edged down 0.1 ppt QoQ to 95.8% as at 4Q 2016 4Q 2016 net absorption was 542,260 sq ft, with activity driven mainly by increased pre-commitments at new office projects. Vacancy expe
Slide 37: Shanghai Office Market
Shanghai Office Market As at end-2016, Shanghai CBD Grade A office rents increased 3.1% YoY to RMB10.4 psm/day, edging down slightly QoQ from RMB10.5 psm/day in the previous quarter CBD Grade A office occupancy declined 0.4 ppt QoQ to 89.8% as at 4Q 2016, down 5.3 ppt YoY due to a record amount
Slide 38: Thank you
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