Keppel REIT · SGX:K71U
Keppel REIT — K-REIT Asia — Investor Presentation (October 2010)
29 slides from Keppel REIT's investor presentation, October 2010
Slide 1: Investor Presentation October 2010
Investor Presentation October 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: Section 1: 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 with a market cap of S$1.8bn1 as at 22 October 2010 1.5m sf NLA portfolio of prime Grade A office assets valued at S$2.3bn
Slide 5: 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$985 psf)
Slide 6: Portfolio of quality assets (cont'd)
Portfolio of quality assets (cont’d) Keppel Towers and As at 30 September 2010 Prudential Tower Bugis Junction Towers GE Tower (KTGE) Attributable NLA (sf) 175,672 246,259 430,112 Ownership 73.4% 100.0% 100.0% Number of tenants 26 10 66 99 years expiring 99 years expiring Tenure Freehold 14 Jan 2095
Slide 7: Our strategy
Our strategy Disciplined Acquisition Prudent Capital Active Asset Growth Management Management Pursue value accretive Manage assets and Attract creditworthy acquisition opportunities cost structure tenants to increase in Singapore and pan‐Asia more effectively occupancy as well as retain good
Slide 8: Key milestones and historical DPU performance
Key milestones and historical DPU performance Recent key milestones Strong DPU growth1 1.8 11 Oct 2010 Announced proposed 1.69 acquisition of one‐third stake in MBFC Towers 1 and 2 and 1.64 CAGR: 27% Marina Bay Link Mall, and 19 Jul 2010 1.6 divestment of KTGE Announced acquisition of 77 King Street
Slide 9: Strong Keppel Land sponsorship
Strong Keppel Land sponsorship Leading development expertise Ocean MBFC Phase 2(1) 1 Financial Centre(1) Leading property developer having successfully completed multiple landmark commercial developments 2 Strong alignment with K‐REIT Asia’s Unitholders Anchor stake of approx. 45% Injection of
Slide 10: Section 2: Singapore Overview
Section 2 Singapore Overview 10
Slide 11: Singapore is one of Asia's leading economies with robust fundamentals
Singapore is one of Asia’s leading economies with robust macro economic fundamentals Forecast 2010 GDP Growth Estimates (%) Singapore’s global recognition is reflected in consistent 14 12.2 high rankings in competitiveness rankings: 12 9.9 No.1 in IMD’s World Competitiveness Scoreboard 2010 9.2
Slide 12: Singapore office rents are inexpensive in a global context
Singapore office rents are inexpensive in a global context but continue to strengthen 200 CBRE Global Office Rents (US$PSF PA) 182.9 160 Based on CBRE’s latest Global Office Rents 153.2 144.0 120 report, Singapore has dropped from the 32nd 125.8 125.1 118.4 113.2 110.1 108.9 most expensive office
Slide 13: Section 3: Acquisition of MBFC interest and divestment of KTGE
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 13
Slide 14: Transaction summary
Transaction summary Keppel Land’s one‐third interest in MBFC Towers 1 & 2 and Marina Bay Link Mall – Proposed Acquisition purchase consideration of S$1,427m, including an income support of up to S$29m Proposed Divestment To divest KTGE to Keppel Land for S$573 million Disposal proceeds from th
Slide 15: 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 – Singapore’s new downtown Located alongside existing portfolio property ‐ One Raffles Quay K‐REIT
Slide 16: 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 17: Joint ownership structure with established real estate managers
Joint ownership structure with established real estate (1) managers 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 ac
Slide 18: Section 4: Key Benefits of Transaction
Section 4 Key Benefits of Transaction 18
Slide 19: Key benefits of the Transaction
Key benefits of the Transaction 1 2 Optimising and Enhances cashflow upgrading resilience and property improves portfolio portfolio fundamentals Improves balance DPU accretive sheet efficiency Transaction(1) and flexibility 4 3 1. Based on the assumptions set out in K‐REIT Asia Management Limited’s
Slide 20: 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 21: 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 22: 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 23: 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 105% Singapore’s position as a regional hub and Fully let Fully let broad based economic growth underpinning 100% demand for MBFC Property Occupancy (
Slide 24: Improved lease expiry profile post-Transaction
Enhances cashflow resilience and improves portfolio 2 fundamentals Improved lease expiry profile post‐Transaction Portfolio Lease Terms by Net Lettable Area Long‐term Short‐ 3 leases 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 25: DPU accretive Transaction
3 DPU accretive Transaction 10% growth in DPU in FY 2011 S$ Cents 7.0 Growth: 10% 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 on
Slide 26: 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 No immediate refinancing needs Debt weighted term to maturity increased from 1.4 years to
Slide 27: Section 5: K-REIT Asia Investment Highlights
Section 5 K‐REIT Asia Investment Highlights 27
Slide 28: 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 28
Slide 29: 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 29