Keppel REIT · SGX:K71U
Keppel REIT — CITIC CLSA ASEAN Forum 2022
31 slides from Keppel REIT's conference presentation, Mar 10, 2022
Slide 1: CITIC CLSA ASEAN Forum 2022
CITIC CLSA ASEAN Forum 2022 9 & 10 March 2022
Slide 2: Outline
Outline Constituent of: ▪ FY 2021 Key Highlights & ESG Approach 3 ▪ Financial Results 7 FTSE ST Large & Mid Cap Index ▪ Portfolio Review 11 ▪ Market Update 21 FTSE EPRA Nareit Global ▪ Additional Information 26 Developed Index IMPORTANT NOTICE: The past performance of Keppel REIT is not necessarily
Slide 3: FY 2021 Key Highlights
FY 2021 Key Highlights Portfolio Optimisation Unlocked value from 275 George Street 5.82 cents 95.4% in Brisbane; completed acquisitions of Keppel Bay Tower in Singapore and FY 2021 DPU Portfolio committed occupancy Blue & William in North Sydney Up 1.6% y-o-y as at 31 Dec 2021 $212.1m Singapore, 78
Slide 4: Creating Sustainable Portfolio with ESG Excellence
Creating Sustainable ESG Benchmarks Portfolio with ▪ MSCI ESG Rating – Upgraded to ‘A’ ESG Excellence ▪ ISS ESG Corporate Rating – Prime status ▪ Global Real Estate Sustainability Benchmark (GRESB) – Green Star status; ‘A’ rating for Public Disclosure Supporting climate action and the transition to
Slide 5: Refreshed ESG Targets
Refreshed ESG Targets Environmental Stewardship ▪ Halve Scope 1 and 2 emissions by 2030 from 2019 levels. ▪ 10% reduction of energy usage by 2030 from 2019 levels; Increase portfolio's renewable energy usage to 40% by 2030. ▪ 5% reduction of water usage by 2030 from 2019 levels. ▪ Increase waste rec
Slide 6: Refreshed ESG Targets (Cont'd)
Refreshed ESG Targets (Cont’d) People and Community ▪ Provide a safe and healthy environment for all stakeholders, adopting the Keppel Zero Fatality Strategy to achieve a zero fatality workplace. ▪ Achieve at least 20 hours of training hours per employee and at least 75% in employee engagement score
Slide 7: Financial Results
Financial Results Pinnacle Office Park, Sydney 7
Slide 8: FY 2021 Distribution to Unitholders Grew by 9.0%
FY 2021 Distribution to Unitholders Grew by 9.0% ▪ Year-on-year growth in distribution to Unitholders was due mainly to full-year contribution Distributable Income ($m) from Victoria Police Centre and Pinnacle Office Park which were added to the portfolio in Distributable Income FY 2020, as well as
Slide 9: Healthy Balance Sheet
Healthy Balance Sheet As at 31 Dec 2021 As at 31 Dec 2020 +/(-) Deposited Property(1) $9,085m $8,386m +8.3% Total Assets $8,488m $7,764m +9.3% Borrowings(2) $3,485m $3,130m +11.4% Total Liabilities $2,898m $2,544m +13.9% Unitholders’ Funds $4,866m $4,498m +8.2% Adjusted NAV per Unit(3) $1.29 $1.29 -
Slide 10: Proactive Capital Management
Proactive Capital Management ▪ All-in interest rate reduced year-on-year to 1.98% p.a. from 2.35% p.a. ▪ $270.0m private placement in Feb 2021 was approximately 4.6 times covered ▪ Issuance of $150.0m of 7-year medium term notes at 2.07% p.a. in Sep 2021 to diversify funding sources and lengthen the
Slide 11: Portfolio Review
Portfolio Review Keppel Bay Tower, Singapore 11
Slide 12: Continuing Portfolio Optimisation
Continuing Portfolio Optimisation ▪ Acquired Keppel Bay Tower, a Grade A office building in the Keppel Bay waterfront precinct in HarbourFront on 18 May 2021 ▪ Unlocked value with the divestment of 275 George Street on 30 Jul 2021 ▪ Expanded into North Sydney on 14 Dec 2021 with the acquisition of B
Slide 13: Blue & William: DPU-Accretive Fund-through Development with Regular Coupon
Blue & William: DPU-Accretive Fund-through Development with Regular Coupon Blue & William will offer panoramic views ▪ DPU accretive investment with 4.5% initial NPI yield after of the Sydney Harbour Bridge and Sydney CBD practical completion ▪ Coupon of 4.5% per annum receivable(1) during fund-thro
Slide 14: Diversified Pan-Asian Portfolio of Prime Commercial Assets
Diversified Pan-Asian Portfolio of Prime Commercial Assets $8.9b portfolio of quality and well-located assets across different markets enhance income stability and long-term growth opportunities As at 31 Dec 2021: T Tower, Seoul 8 Chifley Square, 99.4% Interest Occupancy: 100% 95.4% South Korea Pinn
Slide 15: FY 2021 Portfolio Update
FY 2021 Portfolio Update New leasing demand and expansions from: Banking, insurance and financial services 29.3% Technology, media and telecommunications 23.1% Manufacturing and distribution 14.9% Total Leases Committed Leases Committed Leases Committed Accounting and consultancy services 8.1% by Ge
Slide 16: FY 2021 Portfolio Update (Cont'd)
FY 2021 Portfolio Update (Cont’d) ▪ Average signing rent for Singapore office leases(1) concluded in FY 2021 was $10.56 psf pm ▪ Average expiring rents of Singapore office leases(2)(psf pm): $10.35 in 2022, $10.84 in 2023 and $10.67 in 2024 Lease Expiries and Rent Reviews 22.1% (Based on Committed A
Slide 17: Established and Diversified Tenant Base
Established and Diversified Tenant Base ▪ Keppel REIT has a diversified tenant ▪ Top 10 tenants take up 41.5% of NLA base of 384(1) tenants, many of which are and contribute 36.9% of gross rent established blue-chip corporations Top 10 Tenants Tenant Business Sector % State of Victoria 10.1% Banking
Slide 18: Singapore Portfolio Valuation Largely Stable
Singapore Portfolio Valuation Largely Stable ▪ Singapore building valuations remained largely stable with slight increase for Marina Bay Financial Centre Towers 1 & 2, One Raffles Quay and Keppel Bay Tower due to higher rental rates. Keppel Bay Tower’s valuation increase was also due to cap rate com
Slide 19: Increase in Overseas Property Valuations
Increase in Overseas Property Valuations ▪ Valuation for Australian properties remained stable except for 8 Exhibition Street and Victoria Police Centre with 7.7% and 5.2% increase due to market rental improvement and cap rate compression respectively ▪ Valuation of T Tower in Seoul increased 2.7% d
Slide 20: Meeting Diverse Tenant Needs
Meeting Diverse Tenant Needs Robust portfolio of Grade A office properties that caters to tenants’ diverse business needs Quality Workplaces with Fitted/Flexible Strong ESG Focus Solutions Grade A office buildings that are well managed with Providing greater tenant flexibility sustainable and techno
Slide 21: Market Update
Market Update Blue & William, Sydney Artist’s Impression 21
Slide 22: Singapore Office Market
Singapore Office Market ▪ Average core CBD Grade A office rents increased to $10.80 psf pm in 4Q 2021 while average occupancy in core CBD increased to 93.3% Grade A Rent and Core CBD Occupancy Demand and Supply 2.1 1.9 1.7 1.3 95.8% 95.8% 0.8 0.8 0.9 0.8 1.0 $15 93.8% 94.8% 93.8% 93.9% 92.1% 92.1% 9
Slide 23: Australia Office Market
Australia Office Market 95.2% 91.3% 94.9% 96.0% 87.5% 87.5% 86.4% 87.4% 88.6% 100% 90.8% 92.1% 90.4% 89.9% 100% 1,200 75.5% 76.4% 77.6% 79.3% 79.9% 1,032 1,045 80% 1200 964 80% Sydney CBD 900 799 930 915 895 881 885 60% North Sydney 900 729 60% 641 676 688 665 656 656 651 580 600 40% 600 40% Prime G
Slide 24: Seoul Office Market
Seoul Office Market ▪ CBD Grade A occupancy increased to 89.2% in 4Q 2021 CBD Grade A Rent and Occupancy 200,000 100% 90.7% 87.9% 89.2% 85.0% 86.6% 86.7% 87.0% 87.6% 82.7% 160,000 80% 120,000 60% 97,572 98,508 98,406 98,583 98,926 95,169 91,845 92,325 91,656 80,000 40% 40,000 20% 0 0% 4Q16 4Q17 4Q18
Slide 25: 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 long-term growth opportuni
Slide 26: Additional Information
Additional Information Ocean Financial Centre, Singapore 26 Photo Credit: Central Narcotics Bureau
Slide 27: Attributable NPI by Property
Attributable NPI by Property FY 2021 FY 2020 % % Breakdown of Attributable NPI $’000 $’000 by Geography Ocean Financial Centre 65,965 20.8 66,979 23.7 (For FY 2021) Marina Bay Financial Centre 94,133 29.6 95,746 33.9 One Raffles Quay 35,453 11.2 39,062 13.8 66.8% Keppel Bay Tower(1) 16,493 5.2 - - 8
Slide 28: Portfolio Information: Singapore
Portfolio Information: Singapore As at Marina Bay Ocean Financial Centre One Raffles Quay Keppel Bay Tower 31 Dec 2021 Financial Centre(4) Attributable NLA 698,313 sf 1,022,508 sf 440,969 sf 386,223 sf Ownership 79.9% 33.3% 33.3% 100.0% BNP Paribas, DBS Bank, Deutsche Bank, Keppel Group, Principal D
Slide 29: Portfolio Information: Australia & South Korea
Portfolio Information: Australia & South Korea Blue & William(3), As at 8 Exhibition Victoria Police David Malcolm 8 Chifley Square, Pinnacle Office Sydney T Tower, 31 Dec 2021 Street(4), Centre, Justice Centre, Sydney Park, Sydney (Under Seoul Melbourne Melbourne Perth Development) Attributable 104
Slide 30: 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 53.5% 6.6% track record in this industry asset management platform 39.9% 100% Management Act
Slide 31: Thank You
Thank You For more information, please visit: www.keppelreit.com Connect with us on: Victoria Police Centre, Melbourne 31