CapitaLand Analysts/Media Trip 2016 CapitaLand China Mr. Lucas Loh, CLC CEO, Co-ordinating CEO China 20 November 2016
Contents 1 2 3 4 5 6 CLC Portfolio Overview Key Business Highlight Residential Key Business Highlight Integrated Developments Key Business Highlight Fund Management Sustainable Pipeline Concluding Remarks 2
1 3 CLC Portfolio Overview
Portfolio Overview >42,000 Homes in Pipeline 31 Projects GFA > ~ 5m sqm 8 Raffles City ~2.8m sqm CFA 6 Commercial Projects ~0.4m sqm CFA 6 Private Equity Funds/JV * Fund size: US$4.6b 2 Strategic Investments ~27% stake in CCRE ~20% stake in Lai Fung 5 City Clusters Shenyang Beijing Tianjin Xi an Wuxi Kunshan Wuhan Shanghai Hangzhou Chengdu Ningbo Chongqing Guangzhou Shenzhen Foshan > 2,000 Staff Data as at Sep 2016 Data as at Jun 2014 * Includes the set up of Raffles City China Investment Partners III ( RCCIP III ) 4
Portfolio Overview Focus on Tier 1 / Tier 1.5 Cities ~ 60% of property value in Tier 1 cities & > 90% including Tier 1.5 cities Foshan 0% Wuxi 0% Wuhan 1% Shenyang 1% Shanghai 33% Tier 1 Xian Kunshan 3% 3% Ningbo 6% Tianjin 4% Tier 1.5 Chengdu 6% Chongqing 7% Shenzhen 11% Guangzhou 9% Beijing 8% Hangzhou 8% Note : 1. Property Value refers to the carrying amount of IP/PUD/DPFS, net of impairment as at 30 Sep 2016 2. Based on effective stake held by CLC and total property value in China managed by CLC, exclude Lai Fung, CCRE, Raffles Cities's Operational Retail (managed by CMA) & Serviced Residences (managed by Ascott), Ascott Hengshan (managed by Ascott) & ITC Retail (managed by CMA) 3. Tier 1 cities include Shanghai, Shenzhen, Guangzhou and Beijing. Tier 1.5 cities include Kunshan, Ningbo, Wuxi, Chengdu, Chongqing, Hangzhou, Shenyang, 5 Tianjin, Wuhan and Xian. Tier 2 cities include Foshan.
2 Key Business Highlights - Residential 6
China residential achieved good sales in YTD Sept 2016. FY 2016 expect to exceed FY 2015 sales 92% of launched units sold Sold > 2k units of completed inventory since last year 10,000 9,000 YTD Sep 2016: ~1.4x vs YTD Sept 2015 ~2.8x vs YTD Sept 2014 Units 9,176 16,000 14,000 YTD Sep 2016: ~1.3x vs YTD Sept 2015 ~3.5x vs YTD Sept 2014 Value 14,772 1Q 2Q 3Q Residential Units 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000-3,288 1,057 1,054 6,492 2,422 2,764 1,177 1,306 2,903 2,896 3,377 YTD Sep 2014 YTD Sep 2015 YTD Sep 2016 Sales Value (RMB million) 12,000 10,000 8,000 6,000 4,000 2,000-4,267 1,594 1,371 1,302 11,593 3,750 5,660 2,183 5,807 4,427 4,538 YTD Sep 2014YTD Sep 2015YTD Sep 2016 7 Note: 1. Units sold includes options issued as of 30 Sep 2016. 2. Above data is on a 100% basis and includes Central Park City, Wuxi and Raffles City strata/trading. 3. Value includes carpark and commercial and value added/ business tax.
China Residential Sales CLC achieved most of the sales before implementation of the cooling measures Units Rmb m 5,000 7,000 4,500 4,000 3,500 RMB 4,538m RMB 4,427m RMB 5,807m 6,000 5,000 3,000 2,500 2,000 1,500 1,000 500 1Q 2Q 3,377 units 2,896 units 3Q 2,903 units 4,000 3,000 2,000 1,000-1Q 2016 2Q 2016 3Q 2016-8 Residential Units Sales Value in Rmb'm
4Q 2016 launch ready units ~ 2k units Citta Di Mare Guangzhou Raffles City Chongqing La Botanica Xian Summit Era Ningbo 9
Cooling measures on residential homes sale Newly introduced housing restrictions may slow property market growth Housing restrictions were rolled out in Shanghai and Shenzhen beginning late-mar 16. Monthly price increases slowed after the implementation of the measures. Over the National Day holiday period, 21 cities tightened existing housing purchase restrictions (HPRs) or re-introduced HPRs across Tier 1 to Tier 3 cities Policy driven by Central Government s desire to reduce risks of hard landing in property sector by restraining aggressive increase of leverage by developers and households CL China expects the recent cooling measures implemented by the Chinese government to have some impact on residential sales going forward. Nevertheless, the impact is unlikely to be significant as CL China targets mainly first-time buyers and up-graders. 10
Higher handover in 3Q & YTD Sep 2016 YTD Sep 2016 : ~1.7x y-o-y YTD Sep 2016 : ~1.6x y-o-y 8,000 7,000 6,000 Units 5,684 9,000 8,000 7,000 Value 1,695 7,722 1Q 2Q 3Q Residential Units 11 5,000 4,000 3,000 2,000 1,000 0 3,407 1,596 702 1,657 1,109 1,902 3,254 773 YTD Sep 2015 YTD Sep 2016 Note : 1. Above data is on a 100% basis and includes Central Park City, Wuxi and Raffles City strata/trading 2. Value includes carpark and commercial. Value (Rmb million) 6,000 5,000 4,000 3,000 2,000 1,000 0 4,801 2,757 1,032 2,161 1,695 4,680 1,957 1,012 1,085 YTD Sep 2015 YTD Sep 2016
4Q residential completion on track, ~ 5k units Substantially sold for handover in 4Q 2016 98% Sold Metropolis Kunshan 700 units 98% Sold Century Park Chengdu 600 units 99% Sold Dolce Vita Guangzhou 200 units 83% Sold One ipark Shenzhen 240 units 63% Sold Summit Era Ningbo 400 units 99% Sold La Botanica Xian 2.7k units 12 Note: 1. % units sold includes options issued as of 30 Sep 2016.
3 13 Business Highlights - Integrated Developments CapitaLand
Raffles City Portfolio Continued growth of operating Raffles City properties. NPI remains robust. Raffles City Shanghai Raffles City Beijing NPI (RMB million) 600 500 400 300 200 100 0 399 405 YTD Sep 2015 YTD Sep 2016 NPI (RMB million) 300 200 100 0 194 199 YTD Sep 2015 YTD Sep 2016 Raffles City Chengdu Raffles City Ningbo 200 100 14 NPI (RMB million) 100 0 106 110 YTD Sep 2015 YTD Sep 2016 NPI (RMB million) 50 0 63 52 YTD Sep 2015 YTD Sep 2016
Raffles City Portfolio Committed occupancy remains strong Raffles City 2015 As at Sep 2016 Shanghai 1 - Retail 100% 100% - Office 100% 96% 6 Beijing 2 - Retail 100% 100% - Office 99% 93% 6 Chengdu 3 - Retail 99% 96% - Office Tower 1 69% 80% - Office Tower 2 90% 89% Ningbo 4 - Retail 98% 99% - Office 92% 89% 6 Changning 5 - Office Tower 3 82% 96% - Office Tower 2 47% Retail 98% Occupied Office 91%* Vacant 15 Note: 1. Raffles City Shanghai has been operational since 2003. 2. Raffles City Beijing commenced operations in phases from 2Q 2009. 3. Raffles City Chengdu commenced operation in phases from 3Q 2012. Occupied 4. Raffles City Ningbo commenced operations in late 3Q 2012. 5. Raffles City Changning Office Tower 3 commenced operations from 3Q 2015; Office Tower 2 commenced operations from 2Q 2016. 6. Arising from usual tenancy changes. Currently in negotiations to secure new office tenants. *excluding RCCN Office Tower 2, if including then Occupancy is 86% Vacant
Raffles City Portfolio Stabilized assets achieve positive rental reversion 20% 17% 15% 10% 5% 5% 6% 9% 8% 3% 0% 1% -5% -6% * 16-10% RC Shanghai RC Beijing RC Chengdu RC Ningbo Retail Office *Negative rental reversion due mainly to exit of Treats supermarket Data for the period ended Sep 2016
Raffles City Portfolio Construction on Track for Upcoming Raffles City Projects Raffles City Changning Office Tower 2/3: Operational Retail And Office Tower 1: 2017 Raffles City Hangzhou Office : 2016 Retail: 2017 Hotel and Serviced Residence : 2018 Raffles City Shenzhen Office, Retail and Serviced Residence : 2017 Raffles City Chongqing Office, Retail and Serviced Residence : 2018 Hotel: 2019 Year Of Opening 1 2016 2017 2018 Note: Refers to the expected year of opening of the first component in the particular Raffles City development 17
Raffles City Portfolio Achieved pre-leasing rates >70% for malls opening in 2017 Raffles City Changning Raffles City Hangzhou Just like before Raffles City Changning is a place where you can experience and share to pamper yourself with finer things Raffles City Shenzhen 18
4 Business Highlights - Fund Management 19 CapitaLand
Integrated Developments Private Equity Funds Integrated developments in prime locations Raffles City China Fund 1 China Raffles City Changning JV China CTM Property Trust China Fund Size: US$1.18billion 5 Raffles City developments Fund Size: S$1.03billion Raffles City Changning Fund Size: S$1.12billion Raffles City Chongqing 20 Note: Fund size as at respective fund closing date 1. Raffles City China Fund was closed in Jul 2008 and was upsized by US$180 million in Apr 2010.
Continue to grow the Fund Management Business RCCIP III is CL s largest private equity partnership established to invest in integrated developments in prime gateway cities Raffles City China Investment Partners III ( RCCIP III ) Established on 21st Oct 2016 US$1.5 billion total equity commitment Third Raffles City China private equity vehicle Strong Capital Partners Received strong support from reputable investors with longer investment horizons such as sovereign wealth funds, pension funds and insurance companies. Raffles City Strategy Benefit from long-term drivers of demand: urbanization, growing middle class and domestic consumption 21
5 Sustainable Pipeline 22
Maintain Sustainable Pipeline Successful acquisition through Private Negotiation and JV/Partnership Shanghai HanZhongLu JV with Shanghai Shentong (CL s stake 70%) Guangzhou Dolce Vita JV with Lai Fung (CL s stake 48%) Guangzhou Citta di Mare JV with Li & Fung (CL s stake: 45%) Chengdu Century Park JV with ETG (CL s stake 60%) 23
Maintaining Sustainable Pipeline Going forward maintain pipeline primarily through private negotiation and urban renewal (opportunistic) Private Negotiation Maintaining Pipeline Urban Renewal Land Auction 24
6 Concluding Remarks 25
CONCLUDING REMARKS 1 2 3 4 5 6 7 CLC is well positioned to tap China s continued growth. Will continue to operate through the 5 city clusters and focus on 1 st and 1.5 tier cities Residential market may be impacted by the cooling measures in the short term Integrated developments are on track Continue to grow the fund management platform to expand portfolio Sustainable pipeline through private negotiations or urban renewal Despite the lower growth rate expected, remains confidence of the growth prospects of China. 26
Thank You