Keppel REIT · SGX:K71U
Keppel REIT — Investor Presentation (October 2020)
30 slides from Keppel REIT's investor presentation, October 2020
Slide 1: Investor Presentation October 2020
Investor Presentation October 2020
Slide 2: Outline
Outline Constituent of: ▪ Overview 3 ▪ 3Q 2020 Update 5 FTSE ST Large & Mid Cap Index ▪ Market Review 15 ▪ Additional Information 21 FTSE EPRA Nareit Global Developed Index IMPORTANT NOTICE: The past performance of Keppel REIT is not necessarily indicative of its future performance. Certain statemen
Slide 3: Sustainable Pan-Asian Portfolio with Income Resilience
Sustainable Pan-Asian Portfolio with Income Resilience 98.3% occupancy 7.1 years WALE Green portfolio BCA Green Mark Platinum award for Grade A commercial portfolio with Long portfolio weighted average all Singapore assets; 5 Stars NABERS strong committed occupancy lease expiry (WALE) Energy rating
Slide 4: Resilient Portfolio Anchored by Singapore CBD Assets
Resilient Portfolio Anchored by Singapore CBD Assets $8.4 billion portfolio in key business districts of Singapore, Australia and South Korea enhances income diversification and long-term stability T Tower, Seoul 8 Chifley Square, 99.4% Interest Pinnacle Office Sydney South Korea Occupancy: 94.7% Pa
Slide 5: Active Portfolio Optimisation
Active Portfolio Optimisation ▪ Portfolio optimisation to improve yield and create long-term value for Unitholders ▪ Holding quality assets across different markets enhances income diversification and long-term stability Jul 2020: Completed Sep 2020: Acquiring Dec 2018: Divested May 2019: Acquired N
Slide 6: 3Q 2020 Update
3Q 2020 Update Marina Bay Financial Centre, Singapore 6
Slide 7: 3Q 2020 Key Highlights
3Q 2020 Key Highlights $47.6m 98.3% 3Q 2020 Distributable income High portfolio committed occupancy from operations(1) as at 30 Sep 2020 Up 12.0% q-o-q; up 4.6% y-o-y $142.4m 7.1 years 9M 2020 Distributable income, Long portfolio weighted average lease expiry including $10.0m capital gains(1) as at
Slide 8: Financial Performance
Financial Performance Stable distributable income for 9M 2020 due mainly to: ▪ Contributions from T Tower and 311 Spencer Street, commencement of major Singapore leases, capital gains distribution, and lower borrowing costs ▪ Offset by the impact of the divestment of Bugis Junction Towers in Nov 201
Slide 9: Prudent Capital Management
Prudent Capital Management ▪ All-in interest rate reduced year-on-year to 2.39% p.a. from 2.82% p.a. ▪ Issued $300m(1) of 3.15% perpetual securities to refinance $150m of 4.98% perpetual securities(2) and increase financial flexibility ▪ Approximately $894m of undrawn credit facilities available, in
Slide 10: DPU-Accretive Acquisition of Pinnacle Office Park, Sydney
DPU-Accretive Acquisition of Pinnacle Office Park, Sydney ▪ Acquiring a 100% interest in Pinnacle Office Park, a freehold Grade A commercial property comprising three office buildings near the Macquarie Park Metro Station ▪ Acquisition at a 5.25% initial NPI yield is part of ongoing portfolio optimi
Slide 11: Investment Merits
Investment Merits Click to view property video 1. Portfolio optimisation to improve income resilience and portfolio yield 2. DPU-accretive acquisition that will enhance the REIT’s distributions 3. Opportunity to gain exposure to a key Australian metropolitan office market 4. Expansion into Grade A m
Slide 12: Managing the COVID-19 Situation
Managing the COVID-19 Situation ▪ Keppel REIT’s quality office portfolio and high-quality tenant profile continue to provide income stability and resilience ▪ Portfolio committed occupancy remained high at 98.3%(1). Portfolio weighted average lease expiry was extended to 7.1 years(1); Top 10 tenants
Slide 13: Established and Diversified Tenant Base
Established and Diversified Tenant Base ▪ Keppel REIT has a diversified tenant ▪ Top 10 tenants take up 43.3% of NLA base of 342(1) tenants, many of which are and contribute 38.0% of gross rent established blue-chip corporations Top 10 Tenants Tenant Business Sector State of Victoria 11.3% Banking,
Slide 14: 9M 2020 Leasing Update
9M 2020 Leasing Update Leases Committed Leases Committed New leasing demand and expansions from: by Geography(2) by Type(2) Total Leases Committed Real estate and property services 38.2% Australia, Renewal, ~955,600 sf Singapore, 24.3% 54.1% Technology, media and telecommunications 23.7% (Attributab
Slide 15: Market Review
Market Review 8 Chifley Square, Sydney 15
Slide 16: Singapore Office Market
Singapore Office Market ▪ Average Grade A office rents registered a decrease to $10.70 psf pm in 3Q 2020 while average occupancy in core CBD decreased to 93.9% Grade A Rent and Core CBD Occupancy Demand and Supply 2.1 1.9 1.7 1.3 94.8% 95.8% 93.8% 94.8% 95.8% 95.4% 94.4% 93.9% 0.8 0.8 1.0 0.9 0.9 $1
Slide 17: Australia Office Market
Australia Office Market 94.9% 96.0% 95.2% 94.5% 93.0% 94.0% 97.0% 98.2% 98.2% 92.5% 91.8% 91.3% 89.7% 100% 90.1% 92.1% 87.9% 100% 1,200 1,045 1,200 90% 1,032 1,058 1,028 80% 80% 964 946 Sydney CBD 900 799 60% Melbourne CBD 900 70% 60% 679 503 538 573 575 559 553 50% 600 40% 600 448 40% 406 30% Prime
Slide 18: Seoul Office Market
Seoul Office Market ▪ CBD Grade A occupancy remained stable at 85.1% in 3Q 2020 CBD Grade A Rent and Occupancy 200,000 90.9% 91.3% 100% 87.7% 85.3% 86.9% 85.1% 85.1% 83.1% 160,000 80% 120,000 60% 95,765 95,175 91,851 92,331 91,662 93,578 95,066 97,164 80,000 40% 40,000 20% 0 0% 4Q15 4Q16 4Q17 4Q18 4
Slide 19: Operating in the New Environment
Operating in the New Environment ▪ Physical offices will remain a necessity, although the form and functions of the office will evolve Varying ▪ Many firms will likely incorporate work-from-home Keppel REIT will continue to optimise the considerations in their future office planning. However, portfo
Slide 20: Committed to Delivering Stable Income & Sustainable Returns
Committed to Delivering Stable Income & Sustainable Returns Portfolio Optimisation • Portfolio optimisation to improve yield, while maintaining exposure to Singapore CBD Portfolio • Hold quality assets across different markets for improved income stability Optimisation and to provide more long-term
Slide 21: Additional Information
Additional Information One Raffles Quay, Singapore 21
Slide 22: Growth Since Listing in 2006
Growth Since Listing in 2006 Expanded footprint to Australia: Expanded footprint 77 King Street (100%), Sydney, and to South Korea: 275 George Street (50%), Brisbane T Tower (99.4%), Seoul Listed on SGX >$600m AUM 4 assets in Acquired Acquired Acquired Acquired Acquiring Singapore - 8 Chifley Square
Slide 23: Pinnacle Office Park: Well-Located Freehold Grade A Office
Pinnacle Office Park: Well-Located Freehold Grade A Office Near Macquarie Park Metro Station Short walk to bus interchange On-site end-of-trip facilities On-site café Building Completion 2008 (2 and 4 Drake Avenue), 2011(1) (6 Giffnock Avenue) Attributable NLA 35,132 sm (378,165 sf) Occupancy 96.3%
Slide 24: Pinnacle Office Park: Opportunity to Gain Exposure to a Key Australian Metropolitan Office Market
Pinnacle Office Park: Opportunity to Gain Exposure to a Key Australian Metropolitan Office Market A vibrant metropolitan office market benefitting from infrastructure investments: ▪ Macquarie Park is the second largest office market in New South Wales(1) and has benefitted from improvements in trans
Slide 25: Pinnacle Office Park: Expansion into Grade A Metropolitan Office Space
Pinnacle Office Park: Expansion into Grade A Metropolitan Office Space for Tenants Seeking Cost-Effective or Hub-and-Spoke Business Models ▪ Acquisition of Pinnacle Office Park will enable Keppel REIT to provide quality metropolitan office space, complementing its prime CBD offering ▪ More tenants a
Slide 26: Pinnacle Office Park: Potential Partial Re-Development Opportunity
Pinnacle Office Park: Potential Partial Re-Development Opportunity ▪ One of the three free-standing buildings, 6 Giffnock Avenue, has the potential to be re-developed into a new office building with 2 Drake Avenue (8 floors) higher NLA in future*, subject to approval by 4 Drake Avenue (7 floors) loc
Slide 27: Portfolio Information: Singapore
Portfolio Information: Singapore As at Marina Bay Ocean Financial Centre One Raffles Quay 30 Sep 2020 Financial Centre(4) Attributable NLA 700,504 sf 1,024,238 sf 441,475 sf Ownership 79.9% 33.3% 33.3% BNP Paribas, DBS Bank, Deutsche Bank, Principal tenants(1) ANZ, Standard Chartered Bank, Ernst & Y
Slide 28: Portfolio Information: Australia & South Korea
Portfolio Information: Australia & South Korea Pinnacle Office As at 8 Exhibition David Malcolm 8 Chifley Square, 311 Spencer 275 George Park, Sydney T Tower, 30 Sep 2020 Street(3), Justice Centre, Sydney Street, Melbourne Street, Brisbane (Pending Seoul Melbourne Perth completion) Attributable 104,
Slide 29: Keppel REIT Structure
Keppel REIT Structure Keppel Capital Keppel Land Institutional and The REIT Manager can leverage The REIT Manager can leverage Public Investors the Sponsor‘s expertise and the scale and resources of a larger 50.9% asset management platform 5.5% track record in this industry 43.6% 100% Management Act
Slide 30: Thank You
Thank You For more information, please visit: www.keppelreit.com Connect with us on: T Tower, Seoul 30