Feature: the 6 “I”S - Tampines Mall • Junction 8 • Funan Digitalife Mall • IMM Building Maximising
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CAPITAMALL TRUST CAPITAMALL Inviting malls that give you so much more inspire report to unitholders 2005 REPORT TO UNITHOLDERS 2005 inspire Creating ... value Feature: The 6 “i”s - Tampines Mall • Junction 8 • Funan DigitaLife Mall • IMM Building Maximising ... returns Ingenious Growth Strategies Plaza Singapura • Bugis Junction • Hougang Plaza Units • Sembawang Shopping Centre Jurong Entertainment Centre Transforming ... experiences Corporate Information CAPITAMALL TRUST THE MANAGER REGISTERED ADDRESS REGISTERED ADDRESS EXECUTIVE COMMITTEE HSBC Institutional Trust Services (Singapore) CapitaMall Trust Management Limited Mr Liew Mun Leong Limited 39 Robinson Road Mr Pua Seck Guan 21 Collyer Quay #18-01 Robinson Point Mr Kee Teck Koon #14-01 HSBC Building Singapore 068911 Mr Olivier Lim Tse Ghow Singapore 049320 Phone: +65 6536 1188 Phone: +65 6534 1900 Fax: +65 6536 3884 AUDIT COMMITTEE Fax: +65 6533 1077 Mr Hsuan Owyang DIRECTORS OF THE MANAGER Mr James Glen Service WEBSITE ADDRESS Mr Hsuan Owyang Mr David Wong Chin Huat www.capitamall.com Chairman & Independent Non-Executive Director Mr Olivier Lim Tse Ghow Email: [email protected] Mr Liew Mun Leong CORPORATE DISCLOSURE COMMITTEE Deputy Chairman & Non-Executive Director Trustee Mr Hsuan Owyang HSBC Institutional Trust Services (Singapore) Mr Pua Seck Guan Mr Liew Mun Leong Limited Chief Executive Offi cer & Executive Director Mr Kee Teck Koon 21 Collyer Quay Mr Olivier Lim Tse Ghow #10-01 HSBC Building Mr James Glen Service Singapore 049320 Independent Non-Executive Director COMPANY SECRETARY Phone: +65 6534 1900 Ms Michelle Koh Fax: +65 6533 1077 Mr David Wong Chin Huat Independent Non-Executive Director AUDITOR KPMG Mr S. Chandra Das Certifi ed Public Accountants Non-Executive Director 16 Raffl es Quay Mr Hiew Yoon Khong #22-00 Hong Leong Building Non-Executive Director Singapore 048581 Phone: +65 6213 3388 Mr Kee Teck Koon Fax: +65 6225 0984 Non-Executive Director Partner-In-Charge : Leong Kok Keong (Since fi nancial period ended Mr Olivier Lim Tse Ghow 31 December 2002) Non-Executive Director UNIT REGISTRAR Lim Associates (Pte) Ltd 10 Collyer Quay #19-08 Ocean Building Singapore 049315 Phone: +65 6536 5355 Fax: +65 6536 1360 CONCEPT, DESIGN AND PRODUCTION BY LEXISBRANDING .COM CONCEPT, INtroduction CapitaMall Trust (CMT), which was listed in July 2002, is the fi rst Real Estate Investment Trust (REIT) to be listed on Singapore Exchange Securities Trading Limited. As at 31 December 2005, we are the largest REIT by market capitalisation and asset size in Singapore, with a market capitalisation of approximately S$3.1 billion and an asset size of S$3.4 billion. CMT invests primarily in quality income-producing retail properties in Singapore. Income is mainly derived from rental payments received from a diverse list of over 1,200 leases with local and international retailers. Our portfolio comprises nine quality retail malls which are spread across Singapore in the suburban and central areas. CMT also has a 27.2 percent stake in CapitaRetail Singapore Limited (CRS), a private retail property fund sponsored by CapitaLand Limited, through the Class E bonds issued by CRS. CRS owns three other suburban malls in Singapore. CMT is a component of various key indices which include the Morgan Stanley Capital International, Inc (MSCI) Index, the FTSE European Public Real Estate Association (EPRA) / National Association of Real Estate Investment Trust (NAREIT) Global Real Estate Index, the Global Property Research (GPR) General Property Shares Index, the GPR 250 Global Property Shares Index, the GPR 250 Global REIT Index and the Straits Times Index. CMT is managed by an external manager, CapitaMall Trust Management Limited, which is an indirect wholly- owned subsidiary of CapitaLand Limited, one of the largest listed real estate companies in Asia. INdex INTRODUCTION Corporate Profi le 01 Vision & Mission 04 Key Achievements in 2005 05 INSIGHTS INTO GROWTH Track Record of Value Creation • Consistently Outperformed 30 Distribution Per Unit Forecast • Distribution Per Unit Growth Trend 31 • Core Drivers of Distribution Per Unit Growth 31 • Strong Rental Renewal Rates 32 • High Occupancy Rates 32 • Increasing Shoppers’ Traffi c 33 • Our Shoppers Speak 34 • Our Tenants Speak 36 INGENIOUS VALUE CREATION IN CONVERSATION & GROWTH STRATEGIES Letter to Unitholders (English) 12 The 6 “i”s 09 Letter to Unitholders (Chinese) 18 • Integrated Retail Real Financial Highlights 22 Estate Platform Milestones 25 • Intrinsic Organic Growth • Innovative Asset Enhancement Initiatives • Inviting Experiences • Invaluable Investments • Intensive Capital & Risk Management INSPIRING LEADERSHIP Trust Structure 40 Corporate Governance 41 Board of Directors 52 The Trust Management Team 56 The Property Management Team 60 2 > inspire INCREASING DOMINANCE INTEGRATING PEOPLE & SOCIETY Portfolio at a glance 92 Tampines Mall 96 Human Resources 64 Junction 8 104 Corporate Social Responsibility 66 Funan DigtaLife Mall 112 IMM Building 120 Plaza Singapura 128 Bugis Junction 136 Hougang Plaza Units/ 144 Sembawang Shopping Centre/ Jurong Entertainment Centre/ IN REVIEW Market Overview 76 Operations & Financial Review 78 Accounting Policies 89 INVESTOR RELATIONS IN DETAILS Investor Relations 70 Financial Statements 152 Financial Calendar 71 Unitholders Statistics 191 Comparative Price Trend 72 Additional Information 193 Comparative Yields / CMT Monthly Trading Performance in 2005 73 inspire > 3 Vision & Mission VISION Creating Value, Maximising Returns, and Transforming Experiences for all Stakeholders CapitaMall Trust’s vision embraces all our stakeholders. We rely on the continued and combined support of our Unitholders, business partners, tenants, shoppers and employees alike to achieve this vision and, in return, share with them the fruits of our success. MISSION To deliver stable distributions and sustainable total returns to Unitholders 4 > inspire Achievements in 2005 +27.3% UNIT PRICE APPRECIATION S$770.6 million +33.1% ACQUISITIONS TOTAL RETURNS FOR +14.4% Acquisition of Four Assets worth over S$770.69 UNITHOLDERS million Capital Appreciation of 27.31 percent and PROPERTY VALUATION Increase in Property Valuation of 14.46 percent Total Returns of 33.12 percent for Unitholders INCREASED MARKET CAPITALISATION IMPROVEMENTS IN RENTAL RENEWALS +47.6 % Market Capitalisation increased 47.610 percent +12.6% +25.4% to approximately S$3.1 billion PRECEDING RENTAL RATES +6.8% NET ASSET VALUE PER UNIT Adjusted Net Asset Value per Unit S$3.1 billion FORECAST RENTAL RATES increased 25.47 percent Rental Renewals outperformed Preceding Rental Rates by 12.63 percent and Forecast Rental Rates by 6.84 percent. INCREASED ASSET SIZE INCREASED GROSS REVENUE +47.8% +37.2% Asset Size increased 47.88 percent to approximately S$3.4 billion Gross Revenue increased 37.25 percent to nearly S$243 million S$3.4 billion S$243 million 1. Based on the CMT closing unit price of S$1.76 on 31 December 2004 and the closing unit price of S$2.24 on 30 December 2005. 2. Based on total DPU of 10.23 cents for the fi nancial year ended 31 December 2005, the closing unit price of S$1.76 on 31 December 2004 and the closing unit price of S$2.24 on 30 December 2005. 3. Based on the fi rst year rental rate of the new lease versus the last year rental rate of the old lease. 4. Forecast rental rates for the period 1 January 2005 to 30 October 2005 is the basis for forecast shown in CMT Circular dated 20 July 2004 and the forecast rental rates for the period 31 October 2005 to 31 December 2005 is the basis for the forecast shown in the CMT Circular dated 18 October 2005. 5. Based on the gross revenue of S$177.2 million for the fi nancial year 2004 and the gross revenue of S$243.1 million for the fi nancial year 2005. 6. Based on the valuation of Tampines Mall, Junction 8, Funan DigitaLife Mall, IMM Building and Plaza Singapura as at 1 December 2004 and 1 December 2005. 7. Based on adjusted net asset value per Unit of S$1.63 as at 31 December 2005 and S$1.30 as at 31 December 2004. 8. Based on an asset size of S$2.3 billion as at 31 December 2004 and an asset size of S$3.4 billion as at 31 December 2005 9. Valuation of S$580.8 million for Bugis Junction as at 18 July 2005, valuation of S$39.7 million for approximately 92.4 percent of the total share values in Hougang Plaza as at 21 April 2005 and S$4.6 million for approximately 4.3 percent of the total share values in Hougang Plaza as at 15 June 2005, S$79.0 million for Sembawang Shopping Centre as at 28 April 2005 and S$69.1 million for Jurong Entertainment Centre as at 30 June 2005, all of which were determined by CB Richard Ellis (Pte) Ltd using the Capitalisation of Income Approach, Discounted Cash Flow Analysis and Direct Comparison Method. 10. Based on the market capitalisation of S$2.1 billion as at 31 December 2004 and the market capitalisation of S$3.1 billion as at 31 December 2005. inspire > 5 6 > inspire INgenious Growth Strategies We proactively manage CapitaMall Trust to create value and growth: We have grown our business through yield-accretive acquisitions, innovative asset enhancements and proactive management of our properties. And, we have grown it by being open to new ideas and cultivating our capacity to be imaginative when it comes to unlocking value for our stakeholders. We call our proven value creation cum growth strategies, The 6 ‘i’s. inspire > 7 Growth Strategies CapitaMall Trust (CMT) Growth Strategies The 6 “i”s Growth Strategies The • INtegrated Retail Real Estate Platform • INtrinsic Organic