Keppel REIT · SGX:K71U
Keppel REIT — Investor Day (August 2023)
30 slides from Keppel REIT's investor day presentation, Aug 16, 2023
Slide 1: Investor Day 2023 Bangkok
Investor Day 2023 Bangkok 16 August 2023
Slide 2: Outline
Outline Constituent of: ▪ 1H 2023 Key Highlights 3 ▪ Financial Results 4 FTSE ST Large & FTSE4GOOD Mid Cap Index Developed & ▪ Portfolio Review 8 FTSE4GOOD ASEAN 5 Index ▪ Market Review 18 ▪ Additional Information 23 FTSE EPRA Nareit Global Developed Index IMPORTANT NOTICE: The past performance of K
Slide 3: 1H 2023 Key Highlights
1H 2023 Key Highlights A Resilient Portfolio of Healthy Operating Proactive Capital Performance Management Prime Commercial Assets Anchored in key business districts of High Portfolio Occupancy Aggregate Leverage Singapore, Australia, South Korea and Japan 94.9%(1) 39.2% As at 30 June 2023 As at 30
Slide 4: Financial Results
Financial Results Keppel Bay Tower, Singapore 4
Slide 5: Higher Property Income Underpinned by Resilient Operational Performance
Higher Property Income Underpinned by Resilient Operational Performance ▪ Property Income in 1H 2023 increased 4.7% year-on-year due to higher rentals and portfolio occupancy ▪ 1H 2023 Distribution to Unitholders was lower due mainly to higher property expenses and borrowing costs Distributable Inco
Slide 6: Healthy Balance Sheet
Healthy Balance Sheet As at 30 Jun 2023 As at 31 Dec 2022 +/(-) Deposited Property(1) $9,378m $9,395m (0.2%) Total Assets $8,279m $8,881m (6.8%) Borrowings(2) $3,677m $3,606m +2.0% Total Liabilities $2,510m $3,016m (16.8%) Unitholders’ Funds $5,023m $5,119m (1.9%) Adjusted NAV per Unit(3) $1.31 $1.3
Slide 7: Proactive & Prudent Capital Management
Proactive & Prudent Capital As at 30 Jun 2023 Interest Coverage Ratio(2) 3.4x Management Adjusted Interest Coverage Ratio(3) 3.0x ▪ Aggregate leverage at 39.2% with 76% of borrowings All-in Interest Rate 2.84% p.a. on fixed rates Aggregate Leverage 39.2% Weighted Average Term to Maturity 2.9 years ▪
Slide 8: Portfolio Review
Portfolio Review Blue & William, Sydney 8
Slide 9: Diversified Portfolio of Prime Commercial Assets in Asia Pacific
Diversified Portfolio of Prime Commercial Assets in Asia Pacific $9.2b portfolio of prime quality assets anchored across different markets enhance income stability and long-term growth opportunities T Tower, Seoul KR Ginza II, Tokyo 99.4% Interest South Korea Japan 98.5% Interest Occupancy: 95.3% 3.
Slide 10: 1H 2023 Portfolio Performance
1H 2023 Portfolio Performance Leases Committed Leases Committed (1) (1) by Geography by Type New, Australia, 60.1% 25.9% Rent review, As at 30 Jun 2023: 1.5% Singapore, 63.5% South Korea, Renewal, 94.9%(3) 10.6% 38.4% Portfolio committed occupancy New leasing demand and expansions from: Total Leases
Slide 11: Continuing to Attract Quality Tenants with Prime Office Space
Continuing to Attract Quality Tenants with Prime Office Space ▪ Committed occupancies for Ocean Financial Centre and One Raffles Quay at 100% and Marina Bay Financial Centre and Keppel Bay Tower at >98% ▪ 8 Chifley Square secured a new government tenant who will occupy close to 100,000 sf of space ▪
Slide 12: Well-spread Lease Expiry Profile
Well-spread Lease Expiry Profile ▪ Average signing rent for Singapore office leases(1) concluded in 1H 2023 was $12.35 psf pm, reflecting healthy demand for prime office space ▪ Average expiring rents of Singapore office leases(2) (psf pm): $11.55 in 2023, $11.06 in 2024 and $11.11 in 2025 Lease Exp
Slide 13: Established and Diversified Tenant Base
Established and Diversified Tenant Base ▪ Keppel REIT has a diversified tenant base of 443(1) ▪ Top 10 tenants take up 38.6% of NLA and contribute tenants, many of which are established blue-chip 33.5% of gross rent corporations Top 10 Tenants Tenant Business Sector % Banking, insurance and financia
Slide 14: Singapore Portfolio Valuations (As at 30 June 2023)
Singapore Portfolio Valuations (As at 30 June 2023) Valuation based on Variance Cap Rate 31 Dec 2022 30 Jun 2023 30 Jun 2023 attributable interest (%) S$ % Ocean Financial Centre S$2,140.5m S$2,140.5m - - S$3,069psf 3.40 (79.9% interest) Towers 1 & 2, and Marina Bay Financial S$1,770.0m S$13.0m 0.7
Slide 15: Overseas Property Valuations (As at 30 June 2023)
Overseas Property Valuations (As at 30 June 2023) Valuation based on Local Currency (A$/KRW/JPY) Variance S$ Variance Cap Rate 30 Jun 2023 Keppel REIT’s interest 31 Dec 2022 30 Jun 2023 A$/KRW/JPY % 31 Dec 2022 30 Jun 2023 S$ % (%) 8 Chifley Square(1) A$22,945 A$227.5m A$222.5m A$(5.0m) (2.2) S$209.
Slide 16: ESG Activities in 2Q 2023
ESG Activities in 2Q 2023 A Bento-Making Workshop was organised by Keppel 8 Exhibition Street has Capital together with MDAS. completed the installation of The beneficiaries assembled solar panels which will be bento sets together with staff commissioned in 3Q 2023. volunteers and presented them to
Slide 17: Sustainable and Future Ready Portfolio with ESG Excellence
Sustainable and Future Ready Portfolio with ESG Excellence Keppel REIT’s ESG Targets ESG Benchmarks Environmental Stewardship • MSCI ESG Rating maintained at ‘A’ • ISS Governance Risk Rating maintained at lowest risk level of “1” and ESG ▪ Halve Scope 1 and 2 emissions by 2030 from Corporate Rating
Slide 18: Market Review
Market Review Marina Bay Financial Centre, Singapore 18
Slide 19: Singapore Office Market
Singapore Office Market ▪ Average core CBD Grade A office rents increased to $11.80 psf pm and average occupancy in core CBD increased to 94.8% in 2Q 2023 Grade A Rent and Core CBD Occupancy Demand and Supply (million sf) 2.1 1.9 1.7 1.3 95.8% 93.8% 94.8% 95.8% 93.8% 93.3% 94.7% 94.5% 94.8% 0.8 0.8
Slide 20: Australia Office Market
Australia Office Market 96.0% 95.2% 92.1% 1,500 94.9% 87.5% 88.6% 85.3% 85.7% 85.1% 100% 90.4% 89.9% 84.0% 83.0% 79.0% 100% Sydney CBD 1,200 1,032 1,045 947 80% North Sydney 1200 75.5% 79.9% 80% 964 930 919 934 900 885 60% 900 729 670 686 684 60% 641 676 688 651 600 40% 600 40% Prime Grade Prime Gra
Slide 21: Seoul Office Market
Seoul Office Market ▪ CBD Grade A occupancy decreased to 98.1% in 2Q 2023 CBD Grade A Rent and Occupancy 97.0% 98.5% 98.1% 200,000 90.7% 100% 86.6% 86.7% 89.2% 82.7% 160,000 80% 121,356 124,110 126,629 120,000 60% 97,572 98,926 91,845 92,325 91,656 80,000 40% 40,000 20% 0 0% 4Q17 4Q18 4Q19 4Q20 4Q21
Slide 22: Tokyo Office Market
Tokyo Office Market ▪ Occupancies for Grade A office in Tokyo central 5 wards decreased to 95.2% while Grade B office maintained at 96.1% in 2Q 2023 Tokyo Central 5 Wards Grade A Rent and Occupancy Tokyo Central 5 Wards Grade B Rent and Occupancy 99.6% 99.8% 99.1% 99.0% 99.4% 98.7% 100.0% 98.1% 97.8
Slide 23: Additional Information
Additional Information Pinnacle Office Park, Sydney 23
Slide 24: Committed to Delivering Stable Income & Sustainable Returns
Committed to Delivering Stable Income & Sustainable Returns Portfolio Optimisation • Improve yield by enhancing Keppel REIT’s portfolio of quality assets through strategic acquisitions and divestments Portfolio • Provide income stability and long-term capital appreciation of portfolio, Optimisation
Slide 25: Well-Executed Portfolio Optimisation Strategy
Well-Executed Portfolio Optimisation Strategy Expanded footprint Expanded footprint to Japan: Expanded footprint to Australia: KR Ginza II (98.5%), 77 King Street (100%), Sydney, and to South Korea: T Tower (99.4%), Tokyo 275 George Street (50%), Brisbane Seoul Acquired Acquired - David three adjace
Slide 26: To Distribute an Additional $100m Over Five Years
To Distribute an Additional $100m Over Five Years to Celebrate Keppel REIT’s 20th Listing Anniversary in 2026 • Accumulated capital gains through successful execution of portfolio optimisation since listing in 2006 • As announced on 25 October 2022, to celebrate Keppel REIT’s 20th anniversary in 202
Slide 27: Attributable NPI by Property
Attributable NPI by Property 1H 2023 1H 2022 % % $’000 $’000 Breakdown of Attributable NPI by Geography Ocean Financial Centre 35,864 21.2 33,570 20.9 (For 1H 2023) Marina Bay Financial Centre 50,989 30.1 46,740 29.1 Singapore, One Raffles Quay 21,915 12.9 20,361 12.7 72.5% Keppel Bay Tower(1) 13,96
Slide 28: Portfolio Information: Singapore
Portfolio Information: Singapore As at Marina Bay Financial Ocean Financial Centre One Raffles Quay Keppel Bay Tower 30 Jun 2023 Centre(4) Attributable NLA 697,434 sf 1,018,840 sf 441,690 sf 386,223 sf Ownership 79.9% 33.3% 33.3% 100.0% BNP Paribas, DBS Bank, TikTok, Keppel Group, Principal Drew & N
Slide 29: Portfolio Information: Australia, South Korea & Japan
Portfolio Information: Australia, South Korea & Japan As at 8 Chifley 8 Exhibition Victoria Police David Malcolm Pinnacle Office Blue & William(3), T Tower, KR Ginza II, 30 Jun 2023 Square, Street(4), Centre, Justice Centre, Park, Sydney Sydney Seoul Tokyo Sydney Melbourne Melbourne Perth Attributab
Slide 30: Thank you
Thank you One Raffles Quay, Singapore 30