proposed acquisition of ness buildingir.ascendas-reit.com/newsroom/areitpresentation.pdf · ness...

Proposed Acquisition of Ness Building

2 November 2004

Agenda

• Impact of acquisition on A-REIT– Portfolio Diversification

– Weighted Average Lease Expiry Profile

– Pro forma Financial Effect

– Property Yield

• The Property

• Timetable for Completion

• Acquisition Summary

Asset Class Diversification by Portfolio Value

3

After (2)

Light Industrial

Hi-Tech Industrial

Business ParkDistribution

& Logistics Centres 26%37%

26%11%

Distribution & Logistics

Centres

Business Park

Hi-Tech Industrial

Light Industrial

25%38%

26%11%

Before (1)

Notes:(1) Based on 19 properties(2) Based on 20 properties

Mix of Sale & lease-back vs Multi-Tenanted by Portfolio Value

Sale & lease-back

Multi-tenanted

38%62%

Sale & lease-back

Multi-tenanted

39%61%

After (2)Before (1)

Notes:(1) Based on 19 properties(2) Based on 20 properties

4

Agenda




– Property Yield

• The Property



A-REIT Weighted Average Lease Expiry Profile

5.78 yrs5.59 yrsWeighted Average Lease Term to Expiry

AfterAcquisition of the Property

ExistingProperties

The Property

Timetable for Completion

Acquisition Summary

Impact of acquisition on

A-REIT

Weighted Lease Expiry Profile By Income

4.3%

21.1

%

14.5

%

5.9%

2.7%

6.6%

4.7%

0.0%

0.0%

12.6

%

17.2

%

2.9%

0.8%

0.0%

6.8%

0.0%

4.2%

20.7

%

14.2

%

5.8%

2.6%

6.4%

4.6%

12.4

% 16.8

%

2.8%

0.8%

6.6%

0%

5%

10%

15%

20%

25%20

05

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

>201

9

Year Ending 31 Mar

% o

f A-R

EIT

Prop

erty

Inco

me Before Acquisition

After Acquisition

(1)

(1) Based on 19 properties

6

Agenda




– Property Yield

• The Property



Distribution Per Unit (“DPU”) Positive

Note:*Impact on DPU assuming A-REIT’s 19 properties including C&P Logistics Hub Phase II which is expected to be

completed in December 2004 for S$82.9m and the Property had been acquired and held from 1 April 2003 through to 31 March 2004, and at its optimal gearing level of 30 per cent debt and 70 per cent equity

8

0.11 centsDPU Impact*(proforma annualised impact)

The Property

The Property


Acquisition Summary


A-REIT

Agenda




– Property Yield

• The Property



Yield-Accretive

10.0Yield Before Acquisition Costs (for year one) (%)

2.11Net Income(S$ million)

0.03Property Expenses (S$ million)

2.14Income (S$ million)

Ness BuildingFor Year One

10

Source : Ascendas-MGM Funds Management Limited

The Property


Acquisition Summary


A-REIT

Agenda




– Property Yield

• The Property• Timetable for Completion


Well Located, Diversified Portfolio

12

19

1

Business Park

1. NESS Building

The Property


Acquisition Summary


A-REIT

1

Ness Building

Purchase price : S$21.0 mProperty yield before acquisition costs : 10.0%

Land area : 15,119 sqm (subject to survey)Title : 60-year lease from 1 Jan 2004

Occupancy : 100% Tenant : Ness Display Singapore Pte LtdLease term : 15 years

GFA : 9,593 sqmNLA : Subject to survey

Currently under construction. TOP obtained on 20 Sep 2004. Sale and purchase completion in Sep 2005

13

Tampines Industrial Avenue 2/3 Singapore

Outgoings

Utilities

Maintenance

Property Tax

Land Rent

Lease Mgt Fee

Property

Paid by Ness

Paid by A-REIT

Ness Building

14

The Property


Acquisition Summary


A-REIT

Agenda




– Property Yield

• The Property

• Timetable for Completion• Acquisition Summary


Signed Put and Call Option AgreementsOctober 2004

The Property

• Exercise option • Execution of Sale and Purchase Agreement • Completion

By October 2005(expected)

16

The Property


Acquisition Summary


A-REIT

Agenda




– Property Yield

• The Property



Acquisition Summary

18

• Provides a good mix of long-term versus short-term leases

• Enhances income stability & lease expiry profile• Yield-accretive: 10% property yield• DPU positive of 0.11 cents* per unit

The Property


Acquisition Summary


A-REIT

Note:*Impact on DPU assuming A-REIT’s 19 properties including C&P Logistics Hub Phase II which is expected to be

completed in December 2004 for S$82.9m and the Property had been acquired and held from 1 April 2003 through to 31 March 2004, and at its optimal gearing level of 30 per cent debt and 70 per cent equity

• The value of units in A-REIT (“Units”) and the income from them may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested.

• Investors have no right to request the Manager to redeem their Units while the Units are listed. It is intended that Unitholders may only deal in their Units through trading on the SGX-ST. Listing of the Units on the SGX-ST does not guarantee a liquid market for the Units.

• The past performance of A-REIT is not necessarily indicative of the future performance of A-REIT.

This release may contain forward-looking statements that involve risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, competition from similar developments, shifts in expected levels of property rental income, changes in operating expenses, including employee wages, benefits and training, property expenses and governmental and public policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. You are cautioned not to place undue reliance on these forward looking statements, which are based on current view of management on future events. - End -

proposed acquisition of ness buildingir.ascendas-reit.com/newsroom/areitpresentation.pdf · ness...

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