Frasers Property Ltd. · SGX:TQ5
Frasers Property — Frasers Commercial Trust — Merger or Acquisition (December 2017)
24 slides from Frasers Property's merger presentation, Dec 14, 2017
Slide 1: Joint Venture with Frasers Centrepoint Limited to Acquire Farnborough Business Park
Joint Venture with Frasers Centrepoint Limited to Acquire £175 million Farnborough Business Park in the United Kingdom 14 December 2017
Slide 2: Important notice
Important notice Certain statements in this Presentation constitute “forward-looking statements”. Such forward-looking statement involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Frasers Commercial Trust (“FCOT”) or
Slide 3: Summary of Proposed Joint Acquisition
Summary of Proposed Joint Acquisition FCOT to expand investment mandate to Europe, with initial focus on the United Kingdom (“UK”) 50:50 joint venture between FCOT and Frasers Centrepoint Limited (“FCL”) to acquire Farnborough Business Park for £174.6 million(1) Description Farnborough Busin
Slide 4: Overview of Farnborough Business Park
Overview of Farnborough Business Park 4 46.5 ~555k sq ft 8.3 years 98.1% 89% 36 hectares NLA long WALE(1) occupancy rate(2) tenant retention(3) quality tenants(4) freehold land Thames London Valley Award-winning and well-located business park with 14 high quality buildings that offer an integrated
Slide 5: Overview of Farnborough Business Park (cont'd)
Overview of Farnborough Business Park (cont’d) 5 Single-ownership business park with a site area of 46.5 hectares 34 min train ride to Waterloo Station Connected to key motorway junctions 4 and 4a of M3 40 km to Heathrow Airport 1.6 km to Farnborough Town Centre Adjacent to TAG Farnborough Airport
Slide 6: Overview of Farnborough Business Park (cont'd)
Overview of Farnborough Business Park (cont’d) 6 Selected developments within and adjacent to the property(1) TAG Farnborough Airport(2) ____________________ (1) Includes certain lots sold as long leaseholds. (2) Adjacent to, and is not part of, Farnborough Business Park 6
Slide 7: Expansion of FCOT's investment mandate – synergistic alignment to Sponsor
Expansion of FCOT’s investment mandate – synergistic alignment to Sponsor Synergistic alignment to Sponsor’s top 3 geographical markets Enhanced diversification from broadened mandate Alignment with Sponsor’s top 3 geographical markets New FCOT market FCL’s asset by geography UK (1 asset) Others N
Slide 8: Joint venture structure – synergistic approach
Joint venture structure – synergistic approach Synergistic joint venture structure to leverage on FCL’s network and platform strengths in the UK 3 ROFR FCOT FCL(1) 1 50:50 joint acquisition with Sponsor 50% 1 50% Singapore Jersey and UK 100% 2 Network effect with FCL’s platform HEREF Farnborough L
Slide 9: Key transaction rationale
Key transaction rationale 1 High-quality and strategically located business park 2 Strategic diversification into the UK business park market 3 DPU-accretive acquisition and strengthens FCOT’s portfolio 4 Consistent with the Manager’s strategy to achieve long term growth for FCOT 9
Slide 10: High-quality and strategically located business park
1 High-quality and strategically located business park Strong defensive attributes Lease expiry profile by gross rental income(1) 84.5% Long WALE of 8.3 years(2) More than 84% of leases expiring in FY2022 and beyond provide income defensiveness High occupancy rate of 98.1%(3) 8.8% 4.6% 0.0% 2.
Slide 11: Strong and diversified tenant base
1 High-quality and strategically located business park (cont’d) Strong and diversified tenant base Diversified trade sector mix(1) High quality tenant base(1) % Gross Real Estate / Food and Top ten tenants by rental rental Credit Property Beverage Mining / # income Sector income rating Services 0.6%
Slide 12: Best-in-class building quality and amenities
1 High-quality and strategically located business park (cont’d) Best-in-class building quality and amenities Pinehurst I 25 Templer Avenue Development completed in 2015 Landmark Norman Foster HQ- style building 4-storey building with 48,988 sq ft of lettable area 4-storey building with 79,31
Slide 13: Excellent connectivity and strategic network effect from FCL Group
1 High-quality and strategically located business park (cont’d) Excellent connectivity and strategic network effect from FCL Group’s cluster of business parks FCL Group’s Thames Valley network Excellent transport connectivity Direct train connection to Network effect: Synergistic London 40 k
Slide 14: Differentiated business park integrating lifestyle and community
1 High-quality and strategically located business park (cont’d) Differentiated business park integrating lifestyle and community with a live-work-play focus Integrated communities with high quality amenities Attractive business campus: Mixed- use business environment in Thames Valley that has attr
Slide 15: Strategic diversification into the UK business park market
2 Strategic diversification into the UK business park market Access to the 5th largest economy globally with resilient economic performance post-Brexit vote UK GDP Index Global Financial Crisis Brexit vote 120 Resilient GDP growth supported by resilient services and manufacturing sectors Services
Slide 16: Robust FDI inflows and robust domestic business performance
2 Strategic diversification into the UK business park market (cont’d) Robust FDI inflows and robust domestic business performance Resilient FDI inflows Domestic profits picking up (US$ billions) Average change in profits (%) Brexit vote Brexit vote +1,044% YoY 183 6.0% +338% sequentially(1) 5.0% 70
Slide 17: Resilient UK business park market
2 Strategic diversification into the UK business park market (cont’d) Resilient UK business park market supported by cost efficient positioning and favourable demand-supply dynamics Cost-efficient alternative to CBD and London locations Resilient rental trends despite Brexit vote Total occupier cost
Slide 18: Well located in the Blackwater Valley
2 Strategic diversification into the UK business park market (cont’d) Well located in the Blackwater Valley with strong economic and demographic fundamentals Strong micro-market fundamentals Selected blue-chip tenants located in Blackwater Valley Presence of key business clusters: Manufacturing
Slide 19: DPU-accretive acquisition and strengthens FCOT's portfolio
3 DPU-accretive acquisition and strengthens FCOT’s portfolio Enhanced portfolio diversification Pro forma portfolio asset value as at 30 September 2017 Pro forma NPI for FY2017 S$2,229m S$123.8m(1) S$2,071m 7.1% Farnborough S$113.8m Farnborough 8.0% Business Park Business Park 41.5% 38.5% 47.1 43.3%
Slide 20: Improved lease expiry profile for enlarged portfolio
3 DPU-accretive acquisition and strengthens FCOT’s portfolio (cont’d) Improved lease expiry profile for enlarged portfolio Portfolio lease expiry profile by gross rental income 39.6% Current WALE Pro forma WALE 35.8% (1) 33.8% 31.3% 3.4 years(2) 3.8 years(3) 15.2% 14.7% 12.6% 11.7% 2.6% 2.7% FY18 FY
Slide 21: DPU-accretive transaction
3 DPU-accretive acquisition and strengthens FCOT’s portfolio (cont’d) DPU-accretive transaction Before the proposed After the proposed Key metrics % change acquisition(1) acquisition(2) Net property income 113.8 123.8(3) 8.7% (S$ million) Distributable income 78.6 85.8 9.1% (S$ million) DPU (Singapo
Slide 22: Consistent with the Manager's investment strategy
4 Consistent with the Manager’s investment strategy to achieve long term growth for FCOT 22 The acquisition and expansion of investment mandate are in line with the Manager’s strategies Entry into an attractive and institutionalised market via strategic partnership with Sponsor Manager’s strategie
Slide 23: Expanded ROFR pipeline to more than S$4bn
4 Consistent with the Manager’s investment strategy to achieve long term growth for FCOT (cont’d) Expanded ROFR pipeline to more than S$4bn Selected Singapore assets owned by FCL Selected Australia assets owned by FCL Selected UK assets owned by FCL 1B Homebush Frasers Tower(1) Bay Drive Winnersh Tr
Slide 24: Thank you
Thank you Frasers Centrepoint Asset Management (Commercial) Limited 438 Alexandra Road | #21-00 | Alexandra Point | Singapore 119958 Tel: +65 6276 4882 | Fax: +65 6276 8942 | Email: fcot@fraserscentrepoint.com www.fraserscommercialtrust.com
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