November 28, 2007
Disclaimer Wheelock (Stock code: 20) & Wharf (Stock code: 4) Group Presentation Disclaimer All information and data are provided for information purposes only. All opinions included herein constitute Wheelock and Wharf s judgment as of the date hereof and are subject to change without notice. The Group, its subsidiaries and affiliates hereby disclaim (i) all express, implied, and statutory warranties of any kind to user and/or any third party including warranties as to accuracy, timeliness, completeness, or fitness for any particular purpose; and (ii) any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the information and data contained herein. 2
Presentation Outline Introduction Flagship Projects - Shanghai Wheelock Square, Shanghai - Wuxi Super Tower, Wuxi - Suzhou Super Tower, Suzhou - Hongxing Lu, Chengdu IFC IFC Tiandi Residential Projects - Wholly-owned - J/V Outlook 3
China Macro Economic Environment Government revenue rose by 30% Vs last year Foreign exchange reserves ~ US$1,400B at Q3 2007 Low foreign debts ~ about 12% of GDP as at end of 2006 Inflation rate ~ 4.4% (Jan Oct 2007) 4
China Property Market Market Outlook Robust economic growth and steady wealth creation process with increasing domestic demand in housing in China continue to benefit its real estate developments Robust economic growth 8-9% GDP growth p.a. and even higher in certain cities (11% in 2007) Growth in private enterprise formation ~ over 16% for 2006, ie. about 5 million private enterprises in mainland now (for 10-year up to 2005, the annual growth rate was about 30%!) Growth in automobile sales ~ over 20% p.a. (2007- as of October - automobile sales: 7.15 million vehicles) High personal saving rates ~ over 30% in 2006 for urban households Urbanization: - About 577 million urban population as at end 2006 - Another 300 million people is expected to move into the city area in the next 20 years and directly effect demand on housing 5
Development Strategies Execution Plan: Geographic focus on 1st & 2nd tier cities. Currently covered 11 cities in China Two regional teams located in (i) YRD (Wuxi / Suzhou) & (ii) Chengdu Two principal offices established in Beijing & Shanghai Joint ventures to speed up growth and mitigate risks (China Merchants / China Overseas / Green Town / Jindu) Portfolio expansion anchored on financial solidarity - financial model based on (i) appreciating RMB and (ii) land portion being financed by HK$ where interest differential gain against RMB interest rate is currently at about 2% p.a. 6
Development Strategies Execution plan: Focused on CBDs and new CBDs Brand building & management experience for city center properties (Harbour City / Times Square) Balanced approach on investment & development properties; investment properties to be less than 30% of total 7
Land Bank: Current & Target (attributable) Overall Group Perspective: Aiming for up to 50% of total Group asset value to derive from China portfolio in 5 years (subject to suitable opportunities) Current: Total attributable plot ratio GFA: about 75M sq ft - Acquired in 2007: about 45M sq ft - Acquired since 2005: about 68M sq ft 11 cities 26 sites / projects Aim: 100 million sq ft (plot ratio GFA) as the initial milestone 8
China Project List (Post-2005) Property Name Ownership Project Nature Plot Ratio GFA (s.f.) Attributable Plot Ratio (s.f.) AV (RMB psf) Completion POST 2005 INVESTMENT PROPERTIES IFC / IFC Tiandi (Chengdu) 194 metres Arquitectonica design 100% Office / Retail / Hotel / Residential 4.7M 4.7M 1,533 2010-2012 Wuxi Super Tower (Wuxi) 339 metres SOM design 100% Office / Retail / Hotel 3.0M 3.0M 58 2012-2014 Suzhou Super Tower (Suzhou) 420 metres KPF design HCDL 80% JV Office / Hotel / Residential Sub Total: 7.7M 3.8M 7.7M 3.0M 93 2013 Sub Total: 3.8M 3.0M POST 2005 FOR SALE / MIXED Suzhou Ind l Park Lot 68210 (Suzhou) Tian Fu Times Square (Chengdu) * 100% 100% Residential Office / Retail / Hotel / Residential 2.2M 4.4M 2.2M 4.4M 578 169 2008-2010 2009-2011 No. 10 Gaoxin District (Chengdu) 100% Office / Residential 4.4M 4.4M 187 2009-2011 Shuangliu Development Zone (Chengdu) 100% Office / Retail / Hotel / Residential 9.8M 9.8M 32 Under Planning Taihu Plaza Project Residential (Wuxi) 100% Residential 9.0M 9.0M 145 2011-2014 Lot 37, 38, 43 & 44 Hangzhou (Hangzhou) Wharf 50% JV Residential & O/A Sub Total: 29.8M 4.0M 29.8M 2.0M 778 2011-2013 Lot 24 Suzhou Ind l Park(Suzhou) Wharf 50% JV Residential 1.8M 0.9M 556 2011-2013 Danzishi (Chongqing) Wharf 40% JV Office / Retail / Apartment / Residential 22.6M 9.0M 332 Under planning Wharf JV Total: 28.4M 11.9M HCDL Hangzhou CBD (Hangzhou) Zone B of Jiangbei City (Chongqing) Suzhou Ind l Park Lot 82044-82047 (Suzhou) WPL Foshan 06H (Foshan) Foshan 07-005 (Foshan) HCDL 40% JV HCDL 55% JV HCDL 80% JV WPL 50% JV WPL 50% JV * Project partly sold (floor areas shown exclude sold portion) Residential/Hotel Residential Residential Residential Residential HCDL JV Total: Wharf + HCDL JV Total: WPL JV Total: JV Total: Total (Post-2005) : 3.2M 4.6M 9.8M 17.6M 46.0M 4.9M 2.9M 7.8M 53.8M 1.3M 2.5M 7.8M 11.6M 23.5M 2.5M 1.5M 4.0M 27.5M 68.0M 1,092 554 279 196 521 2009-2012 2011-2012 2013 2011 2011 9
Property Name PRE 2005 INVESTMENT PROPERTIES China Project List (Pre-2005) Ownership Project Nature Plot Ratio GFA (s.f.) Attributable Plot Ratio GFA (s.f.) AV (RMB psf) Completion Shanghai Times Square (Shanghai) 100% Office / Retail / Apartment 0.9M 0.9M 462 1999 Chongqing Times Square (Chongqing)* 100% Office / Retail / Apartment 0.5M 0.5M 213 2004 Wuhan Times Square (Wuhan)* 100% Retail / Hotel 0.4M 0.4M 45 2008 Dalian Times Square (Dalian) 100% Retail 0.2M 0.2M 132 2009 Sub Total: 2.0M 2.0M Beijing Capital Times Square (Beijing) 87.5% JV Office / Retail 0.9M 0.8M 546 1999 Shanghai Wheelock Square (Shanghai) 270 metres KPF design 98% JV Office / Retail 1.2M 1.2M 549 2009 Sub Total: 2.1M 2.0M PRE 2005 FOR SALE Wuhan Times Square (Wuhan)* 100% Residential 0.7M 0.7M 45 2007 Dalian Times Square (Dalian) 100% Residential 1.3M 1.3M 132 2009 Sub Total: 2.0M 2.0M Wellington Garden (Shanghai)* 59% JV Residential 0.2M 0.1M 391 2007 No. 1 Xin Hua Road (Shanghai) 85% JV Residential 0.2M 0.2M 1,121 2009 Jingan Garden (Shanghai) 55% JV Residential 0.8M 0.4M 385 2011 Sub Total: 1.2M 0.7M WPL Tung Fung Lu (Guangzhou) 70% JV Residential / Retail 0.36M 0.3M 495 2010 * Project partly sold (floor areas shown exclude sold portion) Sub Total: 0.36M 0.3M Total (Pre-2005) : 7.0M 10 GRAND TOTAL (Post-2005 + Pre-2005) : 75.0M
Flagship Projects Shanghai Wheelock Square, Shanghai (1717 Nanjng Xi Lu) Wuxi Super Tower, Wuxi Suzhou Super Tower, Suzhou Hongxing Lu, Chengdu - IFC - IFC Tiandi 11
Flagship Projects: Shanghai Wheelock Square, Shanghai 12
Flagship Projects: Shanghai Wheelock Square, Shanghai Location: Nanjing Xi Lu, Jingan District ( 靜安區南京西路 ) at Yan An Expressway exit to Nanjing Xi Lu Site area: 136,432 sq ft Project nature: Investment property - office Plot ratio GFA: 1.2M sq ft AV: RMB 549 psf Target completion: 2009 Ownership: 98%-owned by Wharf 2%-owned by 利偉地產有限公司 13
Flagship Projects: Shanghai Wheelock Square, Shanghai 14
Flagship Projects: Shanghai Wheelock Square, Shanghai The only Grade A supply in 2009 in Puxi prime location Strong office market in Shanghai: - WTO factor: growth in services and office demand from banking, securities, law, accounting, etc - Multinationals continue to set up regional headquarters due to rapid economic development - Demand > supply: upward rental spiral for 6 years since 2001 Prime location Nanjing Xi Lu: - Adjacent to metro line 2, Jingansi station, with a direct access to (i) Shanghai prime shopping area and CBD; (ii) Pudong airport via airport line; and (iii) easy access to inner-ring highway - at Yan An Expressway exit to Nanjing Xi Lu 270-metre Grade A office tower with top specs Designed by KPF 15
Flagship Projects: Shanghai Wheelock Square, Shanghai 16
Flagship Projects: Wuxi Super Tower 17
Flagship Projects: Wuxi Super Tower Wuxi Super Tower 18
Flagship Projects: Wuxi Super Tower Location: Taihu Plaza, Nanchang District ( 南長區太湖廣場 ) Site area: 313,867 sq ft Project nature: Investment property Plot ratio GFA: 3.0M sq ft AV: RMB 58 psf Target completion: 2012-2014 Ownership: 100%-owned by Wharf 19
Flagship Projects: Wuxi Super Tower 20
Flagship Projects: Wuxi Super Tower Foreseeable strong demand on commercial facilities in Wuxi, a top 2nd tier city and a rapidly-growing manufacturing base in Yangtze River Delta Prime location: - Taihu Plaza, New Wuxi CBD - Well-connected infrastructure: well-served by express railways to Wuxi; a metro line to be completed by 2008 and 2010 respectively - Panoramic view of Wuxi City & Taihu 339-metre super tower - New tallest landmark of Wuxi, centre of new CBD - Designed by SOM Grade A office / deluxe serviced apartment / 5-star hotel 21
Flagship Projects: Suzhou Super Tower 22
Flagship Projects: Suzhou Super Tower 23
Location: Xinghu Jie ( 星湖街 ), in the heart of Suzhou s new CBD area Site area: 229,069 sq ft Plot ratio GFA: 3.8M sq ft AV: RMB 93 psf Target completion: 2013 Flagship Projects: Suzhou Super Tower Ownership: J/V project 80%-owned by HCDL / 20%-owned by Zhong Xin Suzhou Industrial ( 中新蘇州工業園區置業 ) 24
Flagship Projects: Suzhou Super Tower 現代大道 Xiandai Ave Times Square 翠園路 Cuiyuan Lu 星湖街Suzhou Super Tower 金雞湖 Jinji Lake 蘇州市新中央商業區 Suzhou New CBD 25
Flagship Projects: Suzhou Super Tower 420-metre skyscraper - New tallest landmark development and future CBD centre of Suzhou - Designed by KPF Prime Location: - Suzhou: a leading commerce and trade centre in Yangtze River Delta - Jinji Lake CBD - new Suzhou CBD and close to the future city government cluster - Well-established transportation network: will be connected to two nearby Metro Line One stations Adjacent to Times Square multiplex comprising prominent retail and office towers Grade A office / 5-star hotel / deluxe serviced apartment 26
Flagship Projects: IFC / IFC Tiandi, Chengdu 27
Flagship Projects: IFC / IFC Tiandi, Chengdu Location: Hongxing Lu, Jinjiang District ( 錦江區紅星路 ) Site area: 590,481 sq ft Project nature: Investment property Plot ratio GFA: 4.7M sq ft AV: RMB 1,533 psf Target completion: 2010-2012 Ownership: 100%-owned by Wharf 28
Flagship Projects: IFC / IFC Tiandi, Chengdu 紅星路商業區 Hongxing Lu Comm. Dis. 市政府 Municipal Government 紅星路項目 Hongxing Lu Project 省政府 Provincial Government 29
Flagship Projects: IFC / IFC Tiandi, Chengdu Chengdu - the dynamic centre of West China Prime location: - Heart of Chengdu s most vibrant commercial and business centre - Connect to metro lines 2 & 3 - With 5 prominent department stores including Isetan, Pacific, Parkson, Top City and Wangfujing nearby Mega investment property project: - Single largest plot in core city centre, GFA equals to 2.5 x Times Square in HK; Retail component at 80% of Harbour City (2M sq ft) - Designed as Wharf s flagship and the premier complex in West China - IFC Tiandi will house renowned international retail names comparable to Harbour City s Canton Road / Peking Road concept - Designed by Arquitectonica 30
Wholly-owned projects: GFA Residential Projects Taihu Plaza Project - Residential, Wuxi (Plot ratio GFA: 9.0M sq ft ; AV: RMB 145 psf) Shuangliu Development Zone, Chengdu (Plot ratio GFA: 9.8M sq ft ; AV: RMB 32 psf) Suzhou Industrial Park Lot 68210, Suzhou (Plot ratio GFA : 2.2M; AV : 578 psf) Tian Fu Times Square, Chengdu (Mixed development; Plot ratio GFA : 4.4M; AV : 169 psf) No. 10 Gaoxin District, Chengdu (Plot ratio GFA : 4.4M; AV : 187 psf) Major J/V projects: 80% of Suzhou Industrial Park Lot 82044-82047, Suzhou (Plot ratio GFA: 9.8M sq ft; AV: RMB 279 psf) 40% of Danzishi, Chongqing (Plot ratio GFA: 22.6M sq ft, AV: RMB 332 psf) 31
Residential Projects: Taihu Plaza Project Residential, Wuxi 32
Location: Site area: Project nature: Plot ratio GFA: AV In between Yunhe West Road and Zhongnan Road, Nanchang District ( 南長區運河西路及中南路之間 ) 3.3M sq ft Residential project for sale 9.0M sq ft RMB 145 psf Target completion: 2011-2014 Ownership: Residential Projects: Taihu Plaza Project Residential, Wuxi 100%-owned by Wharf Located close to Group s Wuxi Super Tower with residential community nearby Well-connected infrastructure: with comprehensive public transportation network including express railways and a metro line Residential development: high-rise and medium-rise apartment 33
Residential Projects: Taihu Plaza Project Residential, Wuxi 34
Residential Projects: Shuangliu Development Zone, Chengdu Bird s eye view of outlet mall 35
Residential Projects: Shuangliu Development Zone, Chengdu 36
Residential Projects: Shuangliu Development Zone, Chengdu Location: Shuangliu Development Zone ( 雙流發展區 ) Site area: Project nature: Plot ratio GFA: AV Target completion: Ownership: 3.5M sq ft Residential with hotel / retail portion for long-term investment 9.8M sq ft RMB 32 psf Under planning 100%-owned by Wharf 37
Residential Projects: Shuangliu Development Zone, Chengdu 11 Km 38
Residential Projects: Shuangliu Development Zone, Chengdu Close to Shuangliu Modern Trade Centralised Development Zone ( 雙流縣現代商貿集中發展區 ) 11 km from the city centre Convenient access to Chengdu airport (6 km) Developed transportation system: linked up with Chuanzang highway ( 川藏公路 ), Chengya expressway( 成雅高速 ), Airport expressway and Chengdu Around-the-city expressway ( 繞城高速公路 ) A mixed-use development comprising residential, commercial and hotel space Popular retail concept: an outlet mall (Qingpu outlet near Shanghai developed by the Group is a success) 39
Residential Projects: Shuangliu Development Zone, Chengdu 40
Residential Projects: Shuangliu Development Zone, Chengdu 41
Residential Projects: Tian Fu Times Square, Chengdu 42
Residential Projects: Tian Fu Times Square, Chengdu Location: No. 11 Dong Da Jie, Jinjiang District ( 錦江區東大街 ) Site area: 761,521 sq ft Project nature: Mixed development Plot ratio GFA: 4.4M sq ft AV: 169 psf Target completion: 2009-2011 Ownership: 100%-owned by Wharf Located in Jinjiang District ( 錦江區 ) at the heart of Chengdu city centre Retail, office, hotel and residential development that will be linked to a major subway station 43
Residential Projects: No. 10 Gaoxin District, Chengdu 44
Residential Projects: No. 10 Gaoxin District, Chengdu 45
Residential Projects: No. 10 Gaoxin District, Chengdu Location: Gaoxin District, Chengdu ( 高新區 ) Site area: 884,459 sq ft Project nature: Residential project Plot ratio GFA: 4.4M sq ft AV RMB 187 psf Target completion: 2009-2011 Ownership: 100%-owned by Wharf Located 200m from a new subway station With the municipal government s upcoming relocation to the vicinity, the district is expected to become the new civic centre of Chengdu 46
Residential Projects: Suzhou Industrial Park Lot 68210, Suzhou 47
Residential Projects: Suzhou Industrial Park Lot 68210, Suzhou Location: Suzhou Industrial Park ( 蘇州工業園區 ) Site area: 3.7M sq ft Project nature: Residential project Plot ratio GFA: 2.2M sq ft AV RMB 578 psf Target completion: 2008-2010 Ownership: 100%-owned by Wharf Superbly-located between Jinji Lake ( 金雞湖 ) and Dushu Lake ( 獨墅湖 ) in the eastern side of the city next to a 27-hole golf club Premier deluxe low density residences 48
Residential Projects: Suzhou Industrial Park Lot 82044-82047 Location: Xiandai Da Dao ( 現代大道 ), Suzhou Industrial Park Site area: Project nature: Plot ratio GFA: AV Target completion: 2013 Ownership: 5.4M sq ft Residential 9.8M sq ft RMB 279 psf J/V project 80%-owned by HCDL and 20%-owned by Zhong Xin Suzhou Industrial ( 中新蘇州工業園區置業 ) 49
Residential Projects: Suzhou Industrial Park Lot 82044-82047 Shanghai Wuxi CBD SITE Proposed Line 1 light rail 50
Residential Projects: Suzhou Industrial Park Lot 82044-82047 Enjoys picturesque scenery of Baitang Park ( 白塘公園 ) in the neighbourhood Well-developed community facilities nearby: e.g. Suzhou Kowloon Hospital and Suzhou Singapore International School Convenient location: a short walk from Metro Line One station and close to Light rail no. 1 Terminus Mega residential development 51
Residential Projects: Danzishi, Chongqing Location: Danzishi, Nanan District ( 南岸區彈子石 ) Site area: Project nature: Plot ratio GFA: AV Target completion: Ownership: 6.1M sq ft Mega residential development with retail / office portion 22.6M sq ft RMB 332 psf Under planning J/V project: 40%-owned by Wharf and 60%-owned by China Overseas Group ( 中國海外發展集團 ) 52
Residential Projects: Danzishi, Chongqing 53
Residential Projects: Danzishi, Chongqing Future CBD of Chongqing: Jiangbei City ( 江北城 ), Jiefangbei ( 解放碑 ) and Danzishi form an integral part of the Golden Triangle Comprehensive transportation network nearby: - Nanbin Road ( 南濱路 ) and Chaotianmen Bridge ( 朝天門大橋 ) are under construction, providing a quick link to most commercial centres in Chongqing - Light rail tram and metro line stations will be built shortly Enjoys awesome Yangtze River view Potential upsurge of residential prices in Chonqging with expected rapid economic growth 54
1.2500 1.0000 0.7500 0.5000 HKDCNY HKDCNY 55 26/10/1990 26/10/1991 26/10/1992 26/10/1993 26/10/1994 26/10/1995 26/10/1996 26/10/1997 26/10/1998 26/10/1999 26/10/2000 26/10/2001 26/10/2002 26/10/2003 26/10/2004 26/10/2005 26/10/2006 26/10/2007 26/10/2008 26/10/2009 26/10/2010 26/10/2011 26/10/2012 26/10/2013 1.1256 0.6708 0.754 RENMINBI Movements 0.9523 x = - 4.36%? 0.7532
Recap Positive outlook of China s economy & property market Overall Group Perspective: aiming for up to 50% of total Group asset value to derive from China portfolio in 5 years Experience in planning & building high-end commercial and residential developments, and brand building & management of large scale high-end investment properties Multi-pronged acquisition / development strategies to speed up growth & mitigate risks - Focus on 1st & 2nd tier cities, CBDs and new CBDs - Wholly-owned + J/V - Current land bank: about 75 million sq ft (plot ratio GFA) in 11 cities at competitive cost - Aim: 100 million sq ft (plot ratio GFA) as initial milestone 56
GFA End of Presentation 57