Capitaland China Trust · SGX:AU8U
Capitaland China Trust — CapitaLand Retail China Trust — Merger or Acquisition (November 2020)
38 slides from Capitaland China Trust's merger presentation, Nov 6, 2020
Slide 1: Proposed Acquisition of Five Business Park Properties and Balance 49% Interest in Rock Square
CapitaLand Retail China Trust CAPITALAND RETAIL Financial ResultsCHINA for 1H 2019TRUST Proposed Acquisition of Five Business Park Properties and Balance 49% Interest in Rock Square 6 November 2020 31 July 2019
Slide 2: Disclaimer
Disclaimer This presentation should be read in conjunction w ith the announcement released by CapitaLand Retail China Trust ("CRCT") on 6 Nov ember 2020 titled "Proposed Acquisition of the Respective I nterests in the Companies w hich Hold the Ascendas Xinsu Portfolio, Ascendas I nnov ation Towers,
Slide 3: Contents
Contents • Transaction Summary and Overview of Acquisition Portfolio “A Transformational Acquisition Towards Long-Term Resilience • Acquisition Rationale and Diversification • Conclusion Tan Tze Wooi CEO ” • Appendix – Property Details CapitaLand Retail China Trust Management Limited 3
Slide 4: Transaction Summary and Overview of Acquisition Portfolio
Transaction Summary and Overview of Acquisition Portfolio Ascendas Innovation Hub
Slide 5: Transaction Summary
Transaction Summary • Respective equity interests or (as the case may be) shares in the Target Companies, from the Vendors 1, which hold the Properties: o Ascendas Xinsu Portfolio in Suzhou (51%2) o Ascendas Innovation Towers in Xi’an (100%2) Proposed Acquisition o Ascendas Innovation Hub in Xi’an (
Slide 6: Overview of the Acquisition Portfolio
Overview of the Acquisition Portfolio Comprises a total of 6 properties with an aggregate GFA of 852,727 sq m and committed occupancy of 91.6% 1. The Business Park Properties feature an aggregate NPI yield of 6.8%2, while Rock Square has an NPI yield of 4.4% 2. Ascendas Innovation Towers (“AIT”) Asc
Slide 7: Acquisition Rationale
Acquisition Rationale Ascendas Innovation Towers
Slide 8: Summary of Key Acquisition Rationale
Summary of Key Acquisition Rationale 1 Strategic Addition of Highly Resilient Business Park Assets 2 Establishing Foothold in High-Growth Economic Zones 3 High Quality Business Parks Supporting the New Economy 4 100% Ownership in Rock Square – Proven Track Record with Resilient Performance 5 Attract
Slide 9: Strategic Addition of Highly Resilient Business Park Assets
1 Strategic Addition of Highly Resilient Business Park Assets Business Parks – Thematically Supported By China’s Economic Growth Initiatives Preferential Policy Growth of Key Decentralisation to Support Tenant Industries Tier 2 cities ✓ 13th 5-year plan shifted focus towards ✓ Committed to investing
Slide 10: Strategic Addition of Highly Resilient Business Park Assets (Cont'd)
1 Strategic Addition of Highly Resilient Business Park Assets (Cont’d) Business Parks – Growing Demand Supported By Robust Industry Drivers High-growth, innovation-based industries Consolidating multiple functions in a single location Key industry drivers Financial Information and Research and Elect
Slide 11: Business Parks in Tier 2 Cities: Higher Occupancy and Rental Growth
1 Strategic Addition of Highly Resilient Business Park Assets (Cont’d) Business Parks in Tier 2 Cities Experiencing Higher Occupancy Rates and Stronger Rental Growth Business Park Occupancy1 (%) Business Park Rental Growth2 (%) 86.0% 7.0% 83.1% 83.1% 5.0% 82.3% 81.8% 5.0% 4.3% 81.2% 81.2% 82.0% 3.6%
Slide 12: Establishing Foothold in High-Growth Economic Zones
2 Establishing Foothold in High-Growth Economic Zones Tier 2 Provincial Cities Set for Rapid Growth Location of CRCT’s existing assets Location of Acquisition Portfolio Upgrading of Ongoing Continued Harbin regional industrial decentralisation urbanisation structures to Tier 2 cities trends People’s
Slide 13: Establishing Foothold in High-Growth Economic Zones (Cont'd)
2 Establishing Foothold in High-Growth Economic Zones (Cont’d) Tier 2 Tech-Driven Provincial Cities Are Supported By Strong Economic Fundamentals Suzhou Xi’an Hangzhou HQs for Fortune 500 Giants China’s Silicon Valley E-Commerce Capital Industry / Sector Focus ICT Biomedical Energy Advanced Elect ro
Slide 14: High Quality Business Parks Supporting the New Economy
3 High Quality Business Parks Supporting the New Economy Well-located Assets with Close Proximity to Key Transport Nodes (Minutes by Driving) 0 10 20 30 40 50 60 Situated in well- established zones w ith Suzhou City Centre (1km w alking distance) ✓ attractive micro- Xinsu Portfolio SIP Hi-speed Rail
Slide 15: High Quality Business Parks Supporting the New Economy (Cont'd)
3 High Quality Business Parks Supporting the New Economy (Cont’d) Campus-style Workplace Designed For High-growth, Innovation-based Industries Ascendas Xinsu Square R&D Ascendas Innovation Towers Good building specifications at attractive rents Campus-style environment with proximity to vast green s
Slide 16: Strong Occupancy Anchored by High Quality Tenants
3 High Quality Business Parks Supporting the New Economy (Cont’d) Strong Occupancy Anchored by High Quality Tenants in Emerging High-growth Sectors Tenant Base By Trade Sector Key Tenants In High-growth Sectors (By % of Gross Rental income (“GRI”)1) 12.3% Financial / Professional Services 19.0% Elec
Slide 17: 100% Ownership in Rock Square – Proven Track Record
4 100% Ownership in Rock Square – Proven Track Record with Resilient Performance 100% Ownership Will Allow CRCT To Capture the Full Upside from AEI and Reconfiguration • One of the largest shopping malls in the well-established Jiangnanxi retail cluster in the Haizhu district of Guangzhou • Double-d
Slide 18: Attractive Entry Valuation That Delivers Accretion
5 Attractive Entry Valuation That Delivers Accretion Agreed Property Value Relative to Independent Valuations 1 (RMB mm) Suzhou Asset Xi’an Assets (Xinsu Portfolio) (AIT and AIH) 1.3% 1.4% Discount 8,234 Discount 8,243 0.1% 0.2% 3.1% 5.0% Discount Discount Discount Discount 8,130 2,265 2,270 2,267 1
Slide 19: 5.1% Pro Forma DPU Accretion and Financing
5 Attractive Entry Valuation That Delivers Accretion (Cont’d) Positive Impact On Portfolio with 5.1%1 Pro Forma Dividend Per Unit (“DPU”) Accretion 1H 2020 Net Property Income Yield Method of Financing4 Pro Forma 1H 2020 Normalised DPU 1,6,7 (%) (%) (S$ cents) Internal Cash Equity Fund 5.8% Resource
Slide 20: Significant Increase in Size
6 Significantly Enhance Portfolio’s Scale, Diversification and Resilience Significant Increase in Size Assets Under Management1 (“AUM”) (S$mm) 1H 2020 Net Property Income (S$mm) 135 4,535 3 3,529 88 474 1,0062 Existing Portfolio Enlarged Portfolio Existing Portfolio Enlarged Portfolio Gross Floor Ar
Slide 21: Enhanced Diversification by Asset Class
6 Significantly Enhance Portfolio’s Scale, Diversification and Resilience (Cont’d) Enhanced Diversification and Exposure Offers Greater Stability Through Market Cycles and Flexibility In Portfolio Reconstitution Existing Portfolio Enlarged Portfolio Retail, Business Parks, By Asset Class (GFA) Reduc
Slide 22: Geographical and Trade Sector Diversification
6 Significantly Enhance Portfolio’s Scale, Diversification and Resilience (Cont’d) CRCT’s Enlarged Portfolio Benefits from Geographical and Trade Sector Diversification and Access to Tech-Driven Business Park Cities Existing Portfolio Enlarged Portfolio Electronics / Engineering 16% GRI contribution
Slide 23: Enlarged and Diversified Tenant Base
6 Significantly Enhance Portfolio’s Scale, Diversification and Resilience (Cont’d) Enlarge and Diversify CRCT’s Tenant Base and Reduces Exposure to Top 10 Tenants and Single Tenant Concentration Risk No. of Leases Reduction in Tenant Concentration in Enlarged Portfolio 2,779 Single Largest Tenant, 3
Slide 24: Strong Sponsor Supporting CRCT's Growth and Diversification
7 Leveraging on Sponsor’s Strong Support, Network and Operational Expertise Strong Sponsor Supporting CRCT’s Growth and Diversification CapitaLand – One of Asia’s Largest Diversified Real Estate Groups ✓ I n-depth local market know ledge across China ✓ Full spectrum of real estate capabilities and r
Slide 25: Professional and Efficient Property Management
7 Leveraging on Sponsor’s Strong Support, Network and Operational Expertise (Cont’d) Professional And Efficient Property Management Is Highly Attractive To Corporate Tenants CapitaLand’s Best-in-Class Property Management Toolkit Community-building Initiatives To Enhance Tenant Stickiness CapitaLand’
Slide 26: Conclusion
Conclusion Singapore-Hangzhou Science Technology Park Phase I
Slide 27: Growing From Strength To Strength
Growing From Strength To Strength 2020 5 High Quality Business Parks Acquisition of balance 49% Div estment of CapitaMall interest in Rock Square Erqi CRCT’s first foray int o Business Parks in Suzhou, Xi’an and Hangzhou CRCT’s core growth Non-core master-leased engine asset mall 2018 Acquisition of
Slide 28: CRCT After The Proposed Acquisitions
CRCT After The Proposed Acquisitions 1 Existing Portfolio Enlarged Portfolio % Change No. of Properties 132 18 38.5% GFA (sq m) 1,005,2892,3 1,769,738 76.0% NLA (sq m) 533,8502 1,243,529 132.9% Number of Leases 2,0812 2,779 33.5% Committed Occupancy4 91.7%2 91.6% - Market Capitalisation5 (S$mm) 1,55
Slide 29: CRCT on Track in Executing Planned Strategies
CRCT on Track in Executing Planned Strategies ✓ Existing retail portfolio has a high component of exposure to essential services at 48.7% of GRI1 ✓ All malls and trade sectors are currently operational Recovery has been observed in successive quarters with 3Q2020 shopper traffic and tenant sales at
Slide 30: Strengthening Position As The Largest China Focused S-REIT
Strengthening Position As The Largest China Focused S-REIT AUM (S$mm) 5,000 AUM: S$4.5bn2 4,000 18 Assets 3,000 AUM: S$3.5bn2 13 Assets 2,000 1,000 0 3 6 9 12 15 18 No. of Assets1 Source: Company filings. Notes: 1. As at 30 June 2020 unless otherwise stated. 2. AUM for Ex isting Portfolio is based o
Slide 31: Appendix
Appendix Ascendas Xinsu Portfolio
Slide 32: Well Distributed Debt Maturity Profile with Proactive Capital Management
Well Distributed Debt Maturity Profile with Proactive Capital Management Debt Maturity Profile (S$mm) Unsecured MML Unsecured Offshore Term Loan Notes Issued Under Multicurrency Debt Issuance Programme Secured Onshore RMB Bank Loan 8 20 10 31 130 4 250 270 2 200 150 150 64 6 2020 2021 2022 2023 2024
Slide 33: Overview of Xinsu Portfolio
Overview of Xinsu Portfolio Semi-Detached Factory Nexteer BTS Ascendas Xinsu Comprises six locations with 61 buildings Xinsu Square Xinsu North Belt NIO Delivery Centre in EPZ Phase 1 & 2 Industrial Square II Description including business parks, and industrial portion, located in Suzhou Industrial
Slide 34: Overview of Ascendas Innovation Towers
Overview of Ascendas Innovation Towers Business Park with two 23-storey business Ascendas Innovation 40 mins to Keji 4 th Road park office towers with a 5-storey podium Towers Description Xi’an Xianyang and 3-storey standalone building in Xi’an International Airport 15 mins to Software Park Ousen As
Slide 35: Overview of Ascendas Innovation Hub
Overview of Ascendas Innovation Hub Northwest Ascendas Business Park with two 6-storey business Zhangbabei Lu Station Yanpingmen Universtiy Innovation Hub Description park office towers, within the core area Station of Xi’an Software Park Lin Kai 45mins to International Xi’an Xianyang Shengda Buildi
Slide 36: Overview of Singapore-Hangzhou Science & Technology Park Phase I and II
Overview of Singapore-Hangzhou Science & Technology Park Phase I and II Integrated Business Park located in the SHSTP Phase I SHSTP Phase II Description Hangzhou Economic & Technological University Town University Town Development Area Hangzhou Xiasha Powerlong City Plaza Asset Type Business Parks W
Slide 37: Overview of Rock Square
Overview of Rock Square One of the largest mall in Jiangnanxi, an Rock Square Guangdong Description established retail cluster located in Tongfuxi Pharmaceutical University Guangzhou’s Haizhu District Metro Jiangnanxi Asset Type Retail Metro Xiaogang Gross Floor Area 88,279 sq m Park Fenghuangxincun
Slide 38: Thank you
Thank Thank you You For enquiries, please contact: For enquiries, please contact: Ms Nicole Chen, Investor Relations Direct: (65) 6713 1648, Email: (Ms) Nicole Chen,nicole.chen@capitaland.com Investor Relations CapitaLand Retail China Trust Management Limited (https://www.crct.com.sg) Direct: (65) 6
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