Keppel Land's Response

Group Financial Highlights

% Increase/ 2008 2007 (Decrease) For the year ($’000) Sales – excluding associated companies 842,166 1,407,886 (40.2) Operating profi t 231,744 312,269 (25.8) Profi t before taxation Before fair value gain on investment properties/impairment 309,563 620,957 (50.1) After fair value gain on investment properties/impairment 314,030 988,736 (68.2) Profi t after taxation and minority interests 227,669 779,650 (70.8) Funds from operations 164,575 486,122 (66.1) Development expenditures 535,473 752,571 (28.8) Capital expenditure on investment and development properties and fi xed assets 103,939 37,039 180.6 Proposed fi nal dvidend 57,705 57,690 – Proposed special dividend – 86,534 nm Total value added 453,700 796,900 (43.1)

At year-end ($’000) Shareholders’ funds 2,442,560 2,291,231 6.6 Minority interests 454,374 352,460 28.9 Short-term borrowings 184,051 318,862 (42.3) Long-term borrowings 1,937,767 1,955,914 (0.9) Total funds invested 5,018,752 4,918,467 2.0

Per share Earnings (cents) (Note1) After tax but before fair value gain on investment properties/impairment 31.1 71.5 (56.5) After tax and fair value gain on investment properties/impairment 31.6 108.3 (70.8) Proposed ﬁ nal dividend (cents) 8.0 8.0 – Proposed special dividend (cents) – 12.0 nm Net tangible assets ($) 3.39 3.18 6.6

Financial ratios Return on shareholders’ equity (%) (Note 2) After tax but before fair value gain on investment properties/impairment 9.7 30.5 (68.2) After tax and fair value gain on investment properties/impairment 9.9 46.2 (78.6) Dividend cover (times) (Note 3) 3.9 8.9 (56.2) Interest cover (times) (Note 4) 11.1 8.6 29.1 Debt-equity ratio (%) (Note 5) 52 41 26.8

Employees (Note 6) Number (average) 2,782 2,793 (0.4) Wages and salaries ($’000) 92,477 92,659 (0.2) Pre-tax proﬁ t per employee ($’000) 87 189 (54.0)

Notes: 1. Earnings per share are calculated by reference to the weighted average number of shares in issue during the year. 2. In calculating returns on shareholders’ equity, the weighted average basis has been used. 3. Dividend cover is 3.6 times in 2007 if the special dividend is included. 4. In the calculation of interest cover, fair value gain on investment properties/impairment is excluded. Interest includes net interest expense taken to the proﬁ t and loss account and interest capitalised under investment properties and properties held for development and sale. 5. In the calculation of the debt-equity ratio, debt includes borrowings net of cash and equity includes minority interests in subsidiary companies. 6. Wages and salaries include amounts capitalised under properties held for development and sale. In the calculation of pre-tax proﬁ t per employee, the share of results of associated companies and fair value gain on investment properties/impairment are excluded. 7. nm – not meaningful

Group Financial Highlights 1 Five-Year Group Financial Proﬁ le

2004 2005 2006 2007 2008 Income statement ($’000) Sales 476,165 586,391 948,018 1,407,886 842,166 Operating profi t 111,051 146,602 204,082 312,269 231,744 Profi t before taxation Before fair value gain on investment properties/impairment 139,915 221,240 302,748 620,957 309,563 After fair value gain on investment properties/impairment 139,915 184,637 263,408 988,736 314,030 Profi t after taxation and minority interests 132,687 155,709 200,310 779,650 227,669 Balance sheet ($’000) Fixed assets and investment properties 1,755,983 1,908,557 1,404,859 1,526,732 1,606,833 Investments 458,039 415,142 659,375 722,361 1,020,367 Properties held for development 186,437 213,801 183,327 172,657 174,781 Non current assets 227,386 658,796 753,216 737,182 813,824 Net current assets (Note 1) 1,387,688 1,642,754 1,485,339 1,890,223 1,529,406 Deferred taxation (28,467) (47,345) (34,438) (130,688) (126,459) Assets employed 3,987,066 4,791,705 4,451,678 4,918,467 5,018,752 Shareholders’ funds 1,606,806 1,678,932 1,590,934 2,291,231 2,442,560 Minority interests 225,627 280,577 310,018 352,460 454,374 Short-term borrowings 325,812 206,923 439,619 318,862 184,051 Long-term borrowings 1,828,821 2,625,273 2,111,107 1,955,914 1,937,767 Total funds invested 3,987,066 4,791,705 4,451,678 4,918,467 5,018,752 Per share Earnings (cents) (Note 2) After tax but before fair value gain on investment properties/impairment 18.7 27.0 33.3 71.5 31.1 After tax and fair value gain on investment properties/impairment 18.7 21.8 27.9 108.3 31.6 Proposed fi nal dividend (cents) One-tier – – 6.0 8.0 8.0 Less tax 4.0 4.0 – – – Gross equivalent 5.0 5.0 6.0 8.0 8.0 Distribution in specie/proposed special dividend (cents) One-tier – – 7.1 12.0 – Less tax – – 29.5 – – Total gross equivalent – – 44.0 12.0 – Net tangible assets ($) 2.26 2.35 2.21 3.18 3.39 Financial ratios Return on shareholders’ equity (%) (Note 3) After tax but before fair value gain on investment properties/impairment 8.6 11.7 15.2 30.5 9.7 After tax and fair value gain on investment properties/impairment 8.6 9.5 12.8 46.2 9.9 Dividend cover (times) (Note 4) 4.6 5.3 5.5 8.9 3.9 Interest cover (times) (Note 5) 3.9 4.3 4.1 8.6 11.1 Debt-equity ratio (%) (Note 6) 96 114 104 41 52 Employees (Note 7) Number (average) 1,975 2,083 2,550 2,793 2,782 Wages and salaries ($’000) 44,173 51,757 66,956 92,659 92,477 Pre-tax profi t per employee ($’000) 52 93 108 189 87

Notes: 1. In arriving at net current assets, short-term borrowings have been excluded. 2. Earnings per share are calculated by reference to the weighted average number of shares in issue during the year. 3. In calculating returns on shareholders’ equity, the weighted average basis has been used. 4. Dividend cover is 3.6 times in 2007 if the special dividend is included. 5. In the calculation of interest cover, fair value gain on investment properties/impairment is excluded. Interest includes net interest expense taken to the proﬁ t and loss account and interest capitalised under investment properties and properties held for development and sale. 6. In the calculation of the debt-equity ratio, debt includes borrowings net of cash and equity includes minority interests in subsidiary companies. 7. Wages and salaries include amounts capitalised under properties held for development and sale. In the calculation of pre-tax proﬁ t per employee, the share of results of associated companies and fair value gain on investment properties/impairment are excluded.

Keppel Land Limited 2 Report to Shareholders 2008 Group Quarterly Results

Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Year $’000 % $’000 % $’000 % $’000 % $’000 Sales 2008 273,084 32 185,906 22 185,787 22 197,389 24 842,166 2007 295,416 21 359,150 26 381,967 27 371,353 26 1,407,886

Operating proﬁ t 2008 71,070 31 61,011 26 42,980 19 56,683 24 231,744 2007 54,989 18 59,588 19 102,345 33 95,347 30 312,269

Proﬁ t before taxation and fair value gain on investment properties/impairment 2008 82,958 27 75,940 25 60,070 19 90,595 29 309,563 2007 83,798 14 82,836 13 109,936 18 344,387 55 620,957

Proﬁ t before taxation but after fair value gain on investment properties/impairment 2008 82,958 27 75,940 24 60,070 19 95,062 30 314,030 2007 83,798 9 82,836 8 109,936 11 712,166 72 988,736

Proﬁ t attributable to shareholders 2008 60,285 26 52,675 23 46,173 20 68,536 31 227,669 2007 62,467 8 63,008 8 81,838 10 572,337 74 779,650

Sales and profi ts for all the quarters in 2008 were lower than the corresponding periods. The lower performance was mainly due to completion of projects such as Urbana and The Belvedere in Singapore as well as The Waterfront and The Seasons in China and Villa Riviera in Vietnam. In addition, Group share of profi ts from Marina Bay Residences and Refl ections at Keppel Bay in 2007 was higher than in 2008.

Financial Reporting Standard 40 (Investment Property) (“FRS 40”) became effective from 1 January 2007. Following its adoption, fair value gains on the Group’s investment properties amounting to $457.1 million was taken to the Group proﬁ t before tax for the ﬁ rst time in 4Q2007. In comparison, the fair value gain on investment properties in 4Q2008 was $4.5 million. However, the fair value gain in 2007 was partly offset by impairment losses of $89.3 million on the Group’s two hotels in Myanmar and exchange losses pertaining to prior years’ investments in Indonesia.

Performance for 4Q2007 was further boosted by a gain of $235.2 million from the restructuring of the ownership of One Rafﬂ es Quay to K-REIT Asia.

Accordingly, 4Q2007 reported the highest pre-tax proﬁ t and attributable proﬁ t, compared with all other quarters in the two years.

Group Quarterly Results 3 Chairman’s Statement

Dear Shareholders, “Despite the economic slowdown, On behalf of the Board, I present the the Group remains focused in its Keppel Land Group report for the year core businesses of developing ended 31 December 2008. Financial Performance residential townships, ofﬁ ce 2008 saw the US sub-prime crisis and sustainable developments, escalate into a global recession. Asia, which had hitherto enjoyed rapid and growing fee-income from growth, was not spared. fund management.” With its key markets affected, Keppel Land posted a proﬁ t after tax and minority interests (PATMI) of $227.7 million or $213.3 million excluding revaluation and other items.

In the previous year, a bumper proﬁ t of $779.7 million was posted, boosted by the surplus from the restructuring of the ownership of the Group’s one-third interest in One Rafﬂ es Quay and the net revaluation gains from its investment buildings. Excluding these items, the Group’s PATMI was $279.4 million for 2007, which is higher than 2008’s by 31%.

Keppel Land Limited 4 Report to Shareholders 2008 With slower residential sales, property to reinvest in the Company by acquiring Overseas trading contribution fell 41.8% from shares without incurring transaction With global slowdown affecting Keppel $274.9 million to $160 million. This is costs. The implementation of the scheme Land’s overseas markets, fewer homes partly mitigated by increased contribution is contingent upon shareholders’ were sold across the region, compared from property investment which rose by approval at an extraordinary general with sales for the year before. 50.8% from $30.9 million to $46.6 million. meeting to be convened before the AGM. Fund management has continued to Despite the challenging market conditions, grow, increasing its contribution to the Major Developments Keppel Land’s fi rst condominium Group’s PATMI by 50% from $14.1 million Singapore project in Vietnam named The Estella to $21.1 million. With Singapore entering recession in achieved moderate success while the third quarter of 2008, the sale of new the Group’s residential townships, The Group has been disciplined and residential units was especially thin in Jakarta Garden City in Indonesia and cautious in land acquisition. As a result, the fourth quarter. This reduced the Central Park City in Wuxi, China, no provisions had to be made for its take-up for the year to an unprecedented continued to chalk up sales. residential landbank in Singapore and low of 4,264 units while prices fell by overseas. Nor were write-downs required 4.7%, the fi rst price decline since 2003. The Botanica, the residential township for the Group’s investment portfolio as the in Chengdu, also posted encouraging overall carrying values of the properties Under such poor market conditions, sales after months of disruption from the were within the current market range. Keppel Land held back on new Sichuan earthquake. launches notably Marina Bay Suites, Net gearing was 0.52 times, up from the luxury residential project in Phase 2 Evergro Properties, Keppel Land’s 0.41 times from end-2007 due mainly of Marina Bay Financial Centre (MBFC). China-focused listed subsidiary, reported to the subscription of K-REIT Asia’s The year also saw fewer sales from its growth in profi ts, from $196,000 in the rights issue and payment of dividends. launched projects such as Refl ections previous year to $545,000. This was at Keppel Bay. contributed mainly by projects in The Group’s net tangible assets per share Changzhou and Tianjin. grew 6.6% to $3.39 due to earnings According to the Urban Redevelopment and higher reserves. Shareholders’ Authority, the full year offi ce take-up During the year, Keppel Land made a funds stood at $2.44 billion, up from totalled 0.19 million sf after a negative few selective acquisitions for residential $2.29 billion a year ago. take-up of 0.37 million sf was registered township, lifestyle and sustainable in the fourth quarter. Nonetheless, this developments in China. These included Proposed Dividend fi gure is better than in 2002 and 2003 the purchase of a 10-ha site adjacent to The Board is recommending a fi nal when the respective take-up fi gures were an earlier-acquired residential township dividend of 8 cents per share to negative 0.93 million sf and negative in Shenyang, and a joint venture to shareholders. 1.13 million sf. develop a residential-cum-marina lifestyle development in Zhongshan, in The dividend payout, amounting to MBFC Phase 1 and Phase 2 secured the Guangdong Province. So far, 20 ha about $58 million or 25% of PATMI of pre-commitments of 66% and 55% of the 82-ha site have been acquired. $227.7 million, is in line with respectively ahead of their completion Keppel Land’s dividend policy to distribute in 2010 and 2012. MBFC, which is Keppel Land will be a shareholder of the up to one-third of net realised profi ts. jointly developed by Keppel Land, Singapore consortium participating in Cheung Kong (Holdings) and Hongkong the Sino-Singapore Tianjin Eco-City The recommended payout is subject to Land, is set to be the latest iconic (Tianjin Eco-City) development which shareholders’ approval at the Annual commercial development in the will be a model and showcase of an General Meeting (AGM) on 24 April 2009. new downtown. ecologically sustainable development If approved, the dividend is expected to for other cities in China. It is envisaged be paid around mid-June 2009. Over at Raffl es Place, construction that the Eco-City will be developed progress at Ocean Financial Centre over 10 to 15 years and will house The Company is also proposing a continues. The award-winning green 350,000 residents. Keppel Land dividend reinvestment scheme under offi ce building, which is being developed will also be the Project Manager which shareholders can choose to on the site of former Ocean Building, for a 30-ha site within the 4-sq km receive dividends in the form of cash or is expected to be completed in 2011. start-up area.

Chairman’s Statement 5 Chairman’s Statement

Fund Management The Group will continue to review all its The Group’s participation in the Tianjin Keppel Land’s fund management operations and projects, and may defer Eco-City will take it to the next level as a business through its two vehicles, an entire project or develop a project green developer, and allow it to leverage K-REIT Asia and Alpha Investment in phases. This review will trim fat and the Keppel brand in the Eco-City to Partners (Alpha), has continued conserve cash, and allow us to invest seek out large-scale developments. to perform. In total, assets under in attractive opportunities that may management (AUM) grew 60% from show up. Acknowledgements $6.1 billion a year ago to $9.8 billion 2009 is expected to be another when the funds are fully-invested and Despite the economic slowdown, challenging year. The outlook is fully-leveraged. the Group remains focused in its core uncertain and much depends on how businesses of developing residential the global situation pans out. With the K-REIT Asia saw a 166.7% growth in townships, offi ce and sustainable concerted efforts of governments to distributable income from $21.8 million developments, and growing fee-income shore up confi dence and their stimulus to $58.2 million. Its portfolio of fi ve from fund management. measures to pump liquidity into the offi ce assets, which achieved almost economy, it is hoped that Asia will full occupancies and positive rental Keppel Land has set as a benchmark stage a speedy recovery. reversions, has maintained its value for its projects to achieve at least at $2.1 billion. K-REIT Asia has also the Green Mark Gold rating by the With a good presence and network in completed a $551.7 million rights issue Building and Construction Authority the region, the Group is well-positioned which will provide additional funding (BCA) or its equivalent for overseas to capitalise on any upturn. capacity to acquire quality assets. projects. The BCA Green Mark rating is Singapore’s equivalent of the United Staff will have to make sacrifi ces and Private equity fund management States’ LEED (Leadership in Energy be fl exible, as they may have to be vehicle Alpha raised US$1.2 billion and Environmental Design) scheme. redeployed to take on new roles and ($1.7 billion) for its new Alpha Asia responsibilities. They will be encouraged Macro Trends Fund which focuses on Keppel Land made signifi cant milestones to acquire new skills and training to trends that impinge on demographics in 2008 as a developer of sustainable take on additional duties or different and changing lifestyles. Alpha, which developments. The Group obtained the job functions. manages fi ve funds with a total AUM of ISO 14001 Environment Management about $7.7 billion when these are fully- System certifi cation for its commercial Together with the guidance of the leveraged and fully-invested, will also and residential operations in Singapore. Board, the support of shareholders, look out selectively for acquisitions. business partners, customers and all In 2008, four buildings were also staff members, Keppel Land will rise Riding Through the Crisis conferred BCA’s Green Mark Awards, to meet the challenges ahead, and Juxtaposed against the periods including the highest Platinum Award produce the best outcome possible. encompassing the Asian Financial Crisis, for Ocean Financial Centre, and Gold September 11 and SARS, Keppel Land Awards for Refl ections at Keppel Bay Yours sincerely, is in a better fi nancial position. No and MBFC Phase One (Commercial). provisions or write-downs for its In Ho Chi Minh City, The Estella was residential landbank and investment awarded the Green Mark Gold Award, properties were necessary, unlike in the fi rst such award to be conferred 1998 and 2001 when hefty provisions in Vietnam. for the landbank drove the Company into losses. Lim Chee Onn Chairman 28 February 2009

Keppel Land Limited 6 Report to Shareholders 2008 Corporate Proﬂ ie

Keppel Land deﬁ nes and reﬁ nes cityscapes across Asia with premier commercial and residential developments stamped with its hallmark of quality, innovation and integrity.

Keppel Land Limited is the property arm Keppel Land is one of the largest listed An established property fund manager, of the Keppel Group, one of Singapore’s property companies by total assets on Keppel Land has two property fund largest multinational groups with key the Singapore Exchange, with total assets management vehicles, K-REIT Asia, businesses in offshore and marine, of $6.1 billion as at end-December 2008. a pan-Asian commercial real estate infrastructure and property. It is also part of the FTSE Straits Times investment trust, and Alpha Investment and EPRA/NAREIT indices. Partners, a private equity entity. Together, With beginnings dating back to 1890, the total assets under management will Keppel Land is today one of Asia’s A leading prime offi ce developer in be close to $9.8 billion when the funds premier property companies, Singapore, Keppel Land contributes are fully-leveraged and fully-invested. recognised for its sterling portfolio to redefi ning the city’s skyline with of quality award-winning residential landmark developments such as Ocean Moving ahead, Keppel Land remains developments and investment-grade Financial Centre, One Raffl es Quay and focused on becoming the property commercial properties, and high Marina Bay Financial Centre in the developer in Singapore and the region standards of corporate governance new downtown. and to deliver sustainable earnings over and transparency. the next few years. Keppel Land is also Asia’s premier Keppel Land is geographically home developer with world-class iconic These earnings will come from developing diversifi ed in Asia, with current focus waterfront homes at Keppel Bay and lifestyle homes in Singapore, residential on Singapore, China, Vietnam, India Marina Bay. township and other overseas residential and Indonesia. developments, the unlocking of value The Group has a total landbank of from its commercial property portfolio, The Company has a strategic focus about 100 million sf with a pipeline of and growing fee-based income from on two core businesses of property about 60,000 homes across Asia and property fund management. development and property fund the Middle East to tap on the demand management. for quality housing in growth cities.

Corporate Proﬁ le 7 By Developing Diverse Talents

Driving Anchored in the strong belief that people are its best assets, Keppel Land trains and develops its talents to build up a robust a Difference pool of human capital. Focused on sustaining long-term shareholder value, Keppel Land maintains a prudent approach in executing its growth strategy as it capitalises on its quality and innovation hallmark, as well as the strength of its international workforce, to create vibrant communities wherever it operates.

By Redeﬁ ning By Exercising Quality Living

Prudence Committed to creating innovative and integrated live-work-and- play environments, Keppel Land Integral to Keppel Land’s business contributes to enhancing lives and strategy are the core values of transforming communities in the prudence and discipline in markets wherever it stamps its ﬁ nancial management and quality hallmark. corporate governance to protect shareholders’ interest.

Keppel Land Limited Driving a Difference 8 Report to Shareholders 2008 9 Exercising Sustainable Prudence Revenue Streams The fund management business Prudent ﬁ nancial management and corporate governance form has performed well. Its contribution to PATMI increased by 50% from Keppel Land’s key pillars for long-term growth and enhancement of $14 million to $21 million. AUM will shareholders’ wealth. Keppel Land’s diversiﬁ ed earnings base be $9.8 billion when the funds are fully-leveraged and fully-invested. provides stable and sustainable streams of income.

Good Corporate Governance

Consistently recognised for high standards of corporate governance, disclosure and transparency in 2008, Keppel Land was ranked third out of 704 companies in Singapore on the Business Times Financial Strength Corporate Transparency Index.

The Group is in a strong ﬁ nancial position to weather the current economic slowdown:

• Cash Balances: $626 million • US$800 million MTN Programme • Reﬁ nancing in 2009: only 9% of total borrowings Redeﬁ ning Quality Living

Leveraging its rich experience and proven track record in creating vibrant Benchmarks of communities wherever it operates, Keppel Land continues to stamp its Excellence international properties with its reputed quality and innovation hallmark. The Group has achieved ISO 14001 Committed to building sustainable developments, Keppel Land will continue Environment Management System to adopt best practices to improve their environmental performance. certiﬁ cation for its commercial and residential properties in Singapore and has set as a benchmark for all its projects in Singapore and overseas the goal to achieve at least the BCA Green Mark Gold standard or equivalent.

International Waterfront Reach Landmarks

Locally and overseas, we remain Keppel Land continues to raise focused on our business in benchmarks internationally with commercial, residential and township premier waterfront landmarks such development, speciﬁ cally tapping as Keppel Bay, the crown jewel of on the growth of home-ownership Singapore’s southern waterfront aspirations and favourable which is poised to place the island demographics across Asia and on the international prime real the Middle East. estate map. Employee Developing Wellness Recognising the importance of employee wellness in developing a robust workforce, Keppel Land actively promotes a variety of Diverse Talents activities and programmes to engage its people. Through its global talent management and development programmes, Keppel Land continues to groom and retain a diverse and robust talent pool to support and drive its growth.

Knowledge Exchange

Platforms for meaningful exchange such as the Annual International Conference, which is held in Singapore and attended by overseas postees, leverage the diversity of experience and knowledge. Talent Development

Through the Keppel Group Scholarship Scheme and industry partnerships such as the Keppel Land-BCA Built Environment Scholarship, the Company continues to provide opportunities for international and local talents to build fulﬁ lling careers with the Group. Board of Directors

Lim Chee Onn, 64

Chairman

Keppel Land Limited 16 Report to Shareholders 2008 Kevin Wong Kingcheung, 53 Khor Poh Hwa, 59 Lim Ho Kee, 63

Group Chief Executive Ofﬁ cer Member, Nominating Committee Chairman, Nominating Committee Member, Board Risk Committee Member, Remuneration Member, Board Safety Committee Committee Member, Board Risk Committee

Tsui Kai Chong, 53 Lee Ai Ming, 54 Tan Yam Pin, 68

Chairman, Audit Committee Member, Audit Committee Chairman, Remuneration Member, Remuneration Member, Board Safety Committee Committee Committee Chairman, Board Safety Member, Board Risk Committee Committee

Board of Directors 17 Board of Directors

Niam Chiang Meng, 51 Heng Chiang Meng, 63 Edward Lee Kwong Foo, 62 Member, Board Safety Committee Member, Nominating Committee Chairman, Board Risk Member, Board Risk Committee Committee Member, Audit Committee

Choo Chiau Beng, 61 Teo Soon Hoe, 60

Keppel Land Limited 18 Report to Shareholders 2008 Lim Chee Onn, 64 Union Congress from May 1979 to June Khor Poh Hwa, 59 Mr Lim is the Non-Executive Chairman 1983 and concurrently, Minister without Mr Khor is an Adviser to Keppel of Keppel Corporation Limited. He is the Portfolio, Prime Minister’s Ofﬁ ce from Corporation in Township and Chairman of Keppel Land Limited, September 1980 to July 1983, and Infrastructure Development, Director of Singapore-Suzhou Township Development remained as Member of Parliament Keppel Land Limited since 1998 and Pte Ltd, Singapore Tianjin Eco-City until December 1992. Director of Evergro Properties Limited Investment Holdings Pte Ltd and a Board since September 2008. Member of the Monetary Authority of Mr Lim holds a Bachelor of Science Singapore and Business China. Mr Lim (First Class Honours) in Naval He is the immediate past President of is also the Honorary Chairman of the Architecture Degree from Glasgow the Singapore-Suzhou Club and of the National Heritage Board and Chairman University and a Master’s Degree in Society of Project Managers. of the Advisory Board, Harvard Singapore Public Administration, Edward S. Mason Foundation and Alternate Member of Fellow, Kennedy School, Harvard Mr Khor is a civil engineering graduate the Council of Presidential Advisors. University. He holds an Honorary with Bachelor’s and Master’s Degrees Doctorate in Engineering, Glasgow from the National University of Singapore. In addition, Mr Lim is Deputy Chairman University. He was conferred the of the Seoul International Business Distinguished Service Order by the Lim Ho Kee, 63 Advisory Council. He is Economic President of the Republic of Singapore Mr Lim is a Director of Keppel Land Advisor to the Jiangsu Provincial in 2007 and Commander Order of the Limited. He is Chairman of Singapore Government, PRC and Consultant to Crown, by HM King Albert II, King of Post Limited and a Director of a number the People’s Government of Yunnan Belgium. of private and public companies including Province, PRC. He is a Member of Jardine Cycle & Carriage Limited, MCL the INSEAD Singapore International Kevin Wong Kingcheung, 53 Land, Herbal Science (Singapore) Pte Council. Mr Lim is also a Member of Mr Wong has been Group Chief Ltd and Transcu Group Ltd. He was a the Board of Trustees, Asia Business Executive Ofﬁ cer/Managing Director, Director of Singapore Telecommunications Council, a Member of the Board of Keppel Land Limited since January 2000. Limited from October 1986 to September Trustees of The Conference Board Prior to this appointment, he was 2000 as well as the Chairman of its and Counsellor of The Conference Executive Director since November 1993. Finance and Investment Committee. Board’s Global Advisory on Economic He is Vice-Chairman and Director, He was also previously the Chairman of Issues. Mr Lim is also Chairman of the Evergro Properties Limited, Chairman UBS (East Asia) and a Member of the Advisory Board of the SKB Institute and Director, Alpha Investment Partners group executive board in Zurich. of Financial Economics, Singapore Limited, and Deputy Chairman and Management University and a member Director of K-REIT Asia Management Mr Lim served on the Board of the Civil of the Governing Board of the Lee Kuan Limited. He is also a Director of Prudential Service College as well as the Singapore Yew School of Public Policy, National Assurance Company Singapore Government’s Public Sector Divestment University of Singapore. (Pte) Limited. Committee in 1987. He also sat on the Singapore Government’s Economic Mr Lim started his career in the Civil Prior to joining Keppel Land Limited, Planning Committee from December 1989 Service. He was Deputy Secretary, Mr Wong had diverse experience in the to October 1991. He was a member Ministry of Communications until his real estate industry in the UK, USA of the Committee on Singapore’s election as Member of Parliament and Singapore. Competitiveness from May 1997 to in July 1977. He served as Political October 1998. Secretary, Ministry of Science and Mr Wong holds a Bachelor’s Degree in Technology from August 1978 Civil Engineering with First Class Honours Mr Lim studied at the London School to September 1980. Mr Lim was from Imperial College, London, and a of Economics where he obtained his Secretary-General, National Trades Master’s Degree from the Massachusetts Bachelor of Science (Economics) Institute of Technology, USA. Honours Degree in 1968.

Board of Directors 19 Board of Directors

Tsui Kai Chong, 53 Committee, and Executive Committee Prior to his current appointment Professor Tsui has been a Director of Member of the Federation Internationale with the Ministry of Community Keppel Land Limited since 2001. He des Conseils en Propriété Industrielle. Development, Youth and Sports, Mr Niam is also the Chairman of K-REIT Asia held various positions in other Singapore Management Limited and a Director of Mrs Lee holds a Bachelor of Law Government ministries and statutory Fullerton Fund Management Company (Honours) Degree from the University boards. He served as Chief Executive Ltd. He is currently the Provost and of Singapore, and is an Advocate Offi cer of the Housing & Development Professor of SIM University. He was & Solicitor of the Supreme Court of Board, Chairman of the Singapore the founding Dean of the School Singapore. Broadcasting Authority, Permanent of Business and the Vice Provost Secretary with the Ministry of of Undergraduate and Graduate Tan Yam Pin, 68 Information, Communications and Education at Singapore Management Mr Tan was appointed to the Board the Arts, Permanent Secretary with University. He was previously an of the Company on 1 June 2003. A the Ministry of Law, Deputy Secretary Associate Professor in the Department Chartered Accountant by profession, with the Ministry of Health, and of Finance and Accounting of the he retired as the Managing Director of Vice President (News) with the then National University of Singapore’s the Fraser and Neave Group in October Television Corporation of Singapore. Faculty of Business Administration and 2002. Deputy Director of its Graduate School Mr Niam graduated from the National of Business. He is a Member of the Mr Tan is non-executive Chairman of University of Singapore with a Bachelor Board of Governors of IP Academy, Power Seraya Limited and Singapore of Social Sciences Degree in Economics. Singapore. Food Industries Limited, and a Director He obtained a Master’s Degree in of Great Eastern Holdings Limited, Public Administration from Harvard He received his PhD in Finance Singapore Post Limited, Leighton Asia University in 1991. from New York University in 1988 Limited (Hong Kong) and Blue Scope and his Chartered Financial Analyst Steel Limited (Australia). He has been Heng Chiang Meng, 63 qualifi cation in 1993. a Member of the Singapore Public Mr Heng was appointed to the Board Service Commission since 1990. He on 1 March 2005. He holds directorships Lee Ai Ming, 54 was a former Board Member of the in various listed companies including Mrs Lee has been a Director of Keppel East Asiatic Company Limited A/S Jasper Investments Ltd, Macquarie Land Limited since November 2002. (Denmark) until March 2006. International Infrastructure Fund Ltd, She is also a Director of K-REIT Asia Orchard Parade Holdings Limited, Management Limited since 28 November Mr Tan holds a Bachelor of Arts Thakral Corporation Limited and 2005. She is currently the Deputy (Honours) Degree in Economics, Garratt’s Ltd. He also sits on the Board Managing Partner of the law fi rm, from the University of Singapore and of Jurong Port Private Ltd, a subsidiary Rodyk & Davidson. She has practised a Master of Business Administration of Jurong Town Corporation. law for more than 20 years in the areas of Degree from the University of British commercial litigation, real estate and Columbia, Canada. He is a Fellow Mr Heng began his career in the intellectual property. Mrs Lee is also of the Canadian Institute of Certifi ed fi nancial sector in 1970 after graduating a Director, the Chairperson of the Accountants, Canada. with a Bachelor of Business Administration Nominating Committee and a Member (Honours) Degree from the University of the Audit Committee of HTL Niam Chiang Meng, 51 of Singapore. International Holdings Limited. Mr Niam was appointed to the Board on 1 June 2003. He is the Permanent He has held senior positions in several Mrs Lee serves on various other forums, Secretary of the Ministry of Community fi nancial institutions including Citibank NA, e.g. as Chairperson of the Asian Patent Development, Youth and Sports. He the Monetary Authority of Singapore Attorney’s Association – Singapore Group, is also a Member of the Singapore and Overseas Union Bank Limited. His Vice-Chair of the International Totalisator Board and the Chairman of other major area of experience was Trademarks Association Treaty Analysis the Singapore Sports School Ltd. in real estate, having been Managing

Keppel Land Limited 20 Report to Shareholders 2008 Director of First Capital Corporation In 1993, Mr Lee was conferred the He is Singapore’s Non-Resident Limited, Executive Director in the Far diplomatic rank of Datu (Grand Cross) Ambassador to Brazil. East Organization Group and Group of the Order of Sikatuna by the Managing Director of Lim Kah Ngam Philippine Government in recognition Mr Choo holds a Bachelor of Science Limited. of his efforts in promoting bilateral (First Class Honours) Degree from the relations between the Philippines University of Newcastle upon Tyne Mr Heng served four terms as a Member and Singapore. (awarded the Colombo Plan Scholarship of Parliament from 1984 to 2001, during to study Naval Architecture) and a Master which he chaired the Government In 2007, he was conferred the highest of Science Degree in Naval Architecture Parliamentary Committees for civilian award by the Indonesian from the University of Newcastle upon Communications and the Environment Government – the Bintang Jasa Utama Tyne. He attended the Programme for as well as the Ang Mo Kio-Cheng San (the Star of Excellent Services) for Management Development in Harvard Community Development Council and his many years towards stronger and Business School in 1982 and is a Cheng San Town Council. closer relations between Singapore Member of the Wharton Society of and Indonesia. Fellows, University of Pennsylvania. In community service, Mr Heng is a Board Member of the National Mr Lee is Chief Executive of Teo Soon Hoe, 60 Environment Agency. PT Ekalumintas, an investment Mr Teo is a Director of Keppel Land consultancy fi rm. Limited, a Senior Executive Director Edward Lee Kwong Foo, 62 and the Group Finance Director of Mr Lee was appointed to the Board on Choo Chiau Beng, 61 Keppel Corporation Limited and the 1 July 2006. Mr Choo is a Director of Keppel Land Chairman of Keppel Telecommunications Limited, Chief Executive Offi cer of & Transportation Limited, MobileOne He became Singapore’s Ambassador Keppel Corporation Limited, and Limited and Keppel Philippines Holdings, to Indonesia in 1994, and retired on Chairman of Keppel Offshore & Inc. In addition, he is a Director of several 1 July 2006 after 36 years of service Marine Limited, Singapore Petroleum other companies within the Keppel with the Foreign Service Branch of the Company Limited and Singapore Group, including Keppel Offshore & Singapore Administrative Service in Refi ning Company Pte Ltd. Marine Limited, k1 Ventures Limited and various senior positions across Singapore Petroleum Company Limited. Asia-Pacifi c. Mr Choo started his career with Keppel Shipyard in 1971 and rose Mr Teo began his career with the Since his fi rst posting to Indonesia in through the ranks to his present position. Keppel Group in 1975 when he joined 1974, Mr Lee served a total of 18 years Keppel Shipyard. He rose through the in the Singapore Embassy in Jakarta. He is also the Chairman of SMRT ranks and was seconded to various He also served as Ambassador to Corporation Limited and sits on the subsidiaries of the Keppel Group the Philippines from 1990 to 1993, as Board of Directors of k1 Ventures before assuming the position of well as High Commissioner to Brunei Limited. He is a member of the Board of Group Finance Director in 1985. Darussalem from 1984 to 1990. Energy Studies Institute and Nanyang Business School Advisory Board. Mr Teo holds a Bachelor of Business For his long-standing contributions Administration Degree from the to the Public Service, Mr Lee was He is also Chairman of Det Norske University of Singapore and is a honoured with several accolades Veritas South East Asia Committee, Member of the Wharton Society of including the Public Administration Board and Council Member of the Fellows, University of Pennsylvania. Medal in 1996 (Silver) and 1998 (Gold), American Bureau of Shipping and the Long Service Medal in 1997 and member of the American Bureau of the Meritorious Service Medal in 2006. Shipping’s Southeast Asia Regional Committee and Special Committee on Mobile Offshore Drilling Units.

Board of Directors 21 Senior Management

12 3 456

1. Albert Foo Cheur Wee 3. Chan Kam Fai 5. Christopher Ho Kum Pouy General Manager, Marketing General Manager, General Manager, Human Resources Property Management 2. Choo Chin Teck Director, Corporate Services 4. Yeo Kah Tiang General Manager, Group Finance and Administration

Keppel Land Limited 22 Report to Shareholders 2008 123456

1. Tan Swee Yiow 3. Kevin Wong Kingcheung 5. Ang Wee Gee Chief Executive Offi cer, Group Chief Executive Offi cer Executive Director, and Singapore Commercial Chief Executive Offi cer, 4. Lim Kei Hin International 2. Loh Chin Hua Chief Financial Offi cer Managing Director, 6. Augustine Tan Alpha Investment Partners Ltd Chief Executive Offi cer, Singapore Residential

Senior Management 23 Senior Management

Ang Wee Gee, 47 Tan Swee Yiow, 49 Augustine Tan Wee Kiong, 50 Executive Director, and Chief Executive Offi cer, Chief Executive Offi cer, Chief Executive Offi cer, Singapore Commercial Singapore Residential International

Mr Ang joined Keppel Land Group in Mr Tan Swee Yiow joined the Mr Augustine Tan joined the Keppel 1991 and was appointed the Executive Keppel Land Group in 1990, and Land Group in 1991 and was appointed Director of Keppel Land International was appointed Chief Executive Offi cer, Chief Executive Offi cer, Singapore Limited and Chief Executive Offi cer, Singapore Commercial on Residential on 1 January 2008, International on 1 January 2008. Prior 1 January 2008. Prior to this overseeing the Group’s residential to these appointments, he was the appointment, he was the Director of developments and investments in Director of Regional Investments, Singapore Commercial, overseeing the Singapore. In addition, he oversees the in charge of the Group’s overseas Group’s commercial investment and Group’s waterfront projects, namely businesses. development operations in Singapore. Marina at Keppel Bay in Singapore Before joining the Keppel Land Group, and Nongsa Bay Marina and Resort in Mr Ang is the Chairman of Keppel Mr Tan was with a banking group, Indonesia. Prior to this appointment, Philippines Properties Inc and advising property valuation, taxation he was the Director of Singapore Keppel Thai Properties Public Co and investment. Residential. He was previously the Limited, property companies listed General Manager for Marketing, on the Philippine Stock Exchange Mr Tan is also the Chief Executive overseeing the marketing of the and the Stock Exchange of Thailand Offi cer of K-REIT Asia, a commercial Keppel Land Group’s developments respectively. He is a Director of property trust listed on the Singapore and investments in Singapore Evergro Properties Limited, which is Exchange. He is also a Director of a and overseas. listed on the Singapore Exchange, number of subsidiaries and associated Sedona Hotels International Pte Ltd, companies of the Keppel Land Group. Prior to joining Keppel Land Limited, the hotel management arm of Keppel Mr Tan had extensive experience in Land Limited, and a number of other Mr Tan holds a Bachelor of Science the leasing of prime commercial and subsidiaries and associated companies Degree (First Class Honours) in retail developments to multinational in the Keppel Land Group. Estate Management from the National companies and the sale of residential University of Singapore and a Master developments with other listed real Mr Ang holds a Master of Business of Business Administration Degree estate developers. Administration Degree from Imperial in Accountancy from the Nanyang College, University of London. He Technological University. Mr Tan holds a Master of Business received his Bachelor of Science Administration Degree from the Degree summa cum laude from the University of Birmingham, UK and University of Denver, USA. a Bachelor of Science Degree in Estate Management from the National University of Singapore. He is a Member of the Singapore Institute of Surveyors and Valuers, and is a Director of Keppel Land International Limited and a number of other Keppel Land Group’s subsidiaries and associated companies.

Keppel Land Limited 24 Report to Shareholders 2008 Lim Kei Hin, 51 Loh Chin Hua, 48 Chief Financial Ofﬁ cer Managing Director, Alpha Investment Partners Limited

Mr Lim was appointed the Mr Loh is the Managing Director of Chief Financial Offi cer of the Alpha Investment Partners Limited (Alpha), Keppel Land Group on 9 July 2007. the real estate fund management arm of the Keppel Land Group. He joined Prior to joining the Keppel Land Group, Alpha in September 2002, and has he was with Singapore Airlines Limited 23 years of experience in real estate and has more than 20 years of diverse investment and fund management. experience having served in different fi nancial and general management Prior to joining Alpha, Mr Loh was roles in Singapore, the Philippines, Managing Director at Prudential Australia and the US. His last Investment Management Inc appointment was Chief Financial Offi cer (“Prudential”), and led its Asian real of Singapore Airport Terminal estate fund management business. Services Limited. During his eight years at Prudential, Mr Loh was responsible for overseeing Mr Lim holds a Bachelor of Science all investment and asset management (Economics) Degree in Accounting & activities for the real estate funds Finance (Honours) f rom the London managed out of Asia. School of Economics & Political Science, UK. Mr Loh started his career in real estate investment with the Government of Singapore Investment Corporation (“GIC”). During his ten years with GIC, Mr Loh held appointments in the San Francisco offi ce and was head of the European real estate group in London before returning to Singapore to head the Asian real estate group.

Mr Loh, a Colombo Plan scholar, graduated from Auckland University with a Bachelor of Property Administration Degree and Pepperdine University’s Presidential/Key Executive MBA Programme. Mr Loh is a Chartered Financial Analyst and is also a registered valuer with the New Zealand Institute of Valuers.

Senior Management 25 Proﬁ le of Directors and Senior Management

Directors

Details of the Directors’ present responsibilities and qualiﬁ cations are set out on pages 19 to 21. Past principal directorships held by Directors in the last ﬁ ve years are as follows:

Lim Chee Onn Niam Chiang Meng Choo Chiau Beng Parksville Development Pte Ltd Bioethics Advisory Committee EDB Investments Pte Ltd Keppel Energy Pte Ltd Board of Trustees for the Community FELS Property Holdings Pte Ltd MobileOne Ltd Assistance Fund FELS Realty Texas Inc k1 Ventures Limited Board of Trustees for the Sporting FELS (USA) Inc Singapore Fund Keppel Asia Limited Kevin Wong Kingcheung Council on Governance of Institutions Keppel Infrastructure Pte Ltd HDB Corporation Pte Ltd of a Public Character Keppel Marine Agencies Inc Singapore Hotel Association Housing and Development Board Keppel Norway AS Subsidiaries and associated SMRT Corporation Limited Keppel Regional Infrastructure Pte Ltd companies of Keppel Land Limited SMRT Trains Ltd Kepventure Pte Ltd SMRT Road Holdings Ltd WIIG Global Ventures Pte Ltd Khor Poh Hwa Maritime and Port Authority of Singapore PM Link Pte Ltd Heng Chiang Meng Singapore Maritime Foundation PM Link (Suzhou) Pte Ltd LKN-Primeﬁ eld Limited CPG FM (Suzhou) Pte Ltd Teo Soon Hoe China-Singapore Suzhou Industrial Park Edward Lee Kwong Foo Keppel Bank Philippines Inc CPG Corporation Pte Ltd Asia Mobile Holdings Centurion Bank Limited Indofood Agri Southern Bank Bhd Lim Ho Kee Manhattan Resources Keppel Shipyard Limited Vertex Venture Holdings Ltd Gas Supply Pte Ltd Mentor Media Ltd Singapore Shipping Corporation Limited CWT Limited

Tan Yam Pin The East Asiatic Company Limited Singapore Food Industries Limited Certis Cisco Security Private Ltd

Keppel Land Limited 26 Report to Shareholders 2008 Senior Management

Details of senior management’s present responsibilities and qualiﬁ cations are set out on pages 24 and 25. Past principal directorships held by senior management in the last ﬁ ve years are as follows:

Ang Wee Gee Lim Kei Hin Various subsidiaries and associated Various subsidiaries and associated companies of Keppel Land Limited companies of Singapore Airport Terminal Services Limited Tan Swee Yiow Various subsidiaries and associated Loh Chin Hua companies of Keppel Land Limited InterRoller Engineering Limited

Augustine Tan Wee Kiong Various subsidiaries and associated companies of Keppel Land Limited

Proﬁ le of Directors and Senior Management 27 Key Personnel

Keppel Land Limited Property Investment, Development and Management

Lim Chee Onn Keppel Land International Stephen Choo Kooi Yoon Chairman Limited Senior General Manager (Projects) Ang Wee Gee Kevin Wong Kingcheung Executive Director, and Liew Chin Sin Group Chief Executive Ofﬁ cer Chief Executive Ofﬁ cer, International General Manager (China Investment)

Choo Chin Teck Sam Moon Thong Director, Corporate Services and General Manager (Investment) Group Company Secretary Gan Ee Chin Finance and Administration General Manager (Township) Lim Kei Hin Chief Financial Offi cer Ng Ooi Hooi General Manager (Special Projects) Yeo Kah Tiang (Mrs) General Manager, April Chang Shu Ping Group Finance and Administration Assistant General Manager (Asset Management) Melissa Teh Siew Ngok (Mrs) Financial Controller, Singapore Commercial Finance and Administration Tan Swee Yiow Chief Executive Offi cer, Tan Boon Ping ( Ms) Singapore Commercial Financial Controller, Group Finance and Accounts Jimmy Loon Chue Cheok General Manager (Projects), International Marina Bay Financial Centre Ho Cheok Kong Chief Executive Offi cer (China) Mok Soo Project Director, Linson Lim Soon Kooi Marina Bay Financial Centre Chief Executive Offi cer (Southeast Asia) Jeff Tan Yek Sang Peter Chew Cheng Ming Deputy General Manager Chief Executive Offi cer (Business Development) (India & Middle East) Paul Lau Kah Kee Ong Tiong Beng Deputy General Manager (Projects) Chief Executive Offi cer (Township & Waterfront Developments)

Keppel Land Limited 28 Report to Shareholders 2008 Property Investment, Development and Management

Singapore Residential Rose Tong (Ms) Keppel Bay Pte Ltd Augustine Tan Wee Kiong Head (Marketing – Retail) Augustine Tan Wee Kiong Chief Executive Offi cer, Marina Bay Financial Centre Chief Executive Offi cer, Singapore Residential Singapore Residential Property Management Goh Han Kee Christopher Ho Kam Pouy Tan Tai Chiew Deputy General Manager (Projects) General Manager, General Manager Property Management Vernon Low Ong Chye Marina at Keppel Bay Deputy General Manager Steven Neo Say Hian Augustine Tan Wee Kiong (Business Development) Assistant General Manager, Chief Executive Offi cer, Property Management Singapore Residential Lim Kian Lee Assistant General Manager (Projects) Alvin Loh Weng Onn Tan Tai Chiew Assistant General Manager, Acting General Manager Go Kee Tiang Property Management Assistant General Manager (Projects) K-REIT Asia Management Limited Investor Relations and Research Tan Swee Yiow Marketing Serena Toh Lai Siong (Ms) Chief Executive Offi cer Albert Foo Cheur Wee Deputy General Manager, General Manager, Marketing Investor Relations and Research Daniel Cerf Deputy Chief Executive Offi cer Lee Eng Beng Corporate Development (Up to 14 March 2009) Deputy General Manager, Marketing Kwok Yan Hoe (Overseas Residential) Deputy General Manager, Evelyn Tong Siew Wei (Ms) Corporate Development Financial Controller Sally Tan Meow Ling (Ms) Assistant General Manager, Marketing Information Technology Joseph Low Kar Yew (Commercial) Kevin Chua Kee Wee Assistant General Manager (Investment) Assistant General Manager, Gina Ng Su Ling (Ms) Information Technology Chua Hsien Yang Head (Marketing – Offi ce) Assistant General Manager (Investment) Marina Bay Financial Centre Human Resources Chan Kam Fai Evergro Properties Limited Kan Kum Wah General Manager, Human Resources Goh Toh Sim Head (Marketing – Residential) Chief Executive Offi cer Marina Bay Financial Centre Internal Audit Tee Swee Teng Chan Shui Har (Ms) Senior Manager, Group Internal Audit Deputy Chief Executive Offi cer

Key Personnel 29 Key Personnel

Hotels, Serviced Property Fund Management Apartments and Resorts International

Alpha Investment Sedona Hotels International Ang Wee Gee Partners Limited Pte Ltd Executive Director, and Loh Chin Hua Vincent Tan Aik Cheong Chief Executive Offi cer, International Managing Director Senior Vice President China Christina Tan Hua Mui (Ms) Keppel Digihub Limited Ho Cheok Kong Executive Director Dave Ng Chun Sun Chief Executive Offi cer (China) Chief Executive Offi cer Desmond Tang Kok Peng William Tan Tin Kwang Executive Director General Manager (Northern China) Young Lok Kuan Executive Director Tan Choon Hin Deputy General Manager (Tianjin) Goh York Lin Investment Director Peter Lim Meng Peng Assistant General Manager (Shenyang)

Peter Lee Wai Mun Assistant General Manager (Chengdu & Kunming)

Robin Ang Yee Kang Assistant General Manager (Zhongshan)

Daniel Chong Siew Hoe Senior Manager (Wuxi)

Keppel Land Limited 30 Report to Shareholders 2008 International

Southeast Asia : Vietnam, Yeo Chee Kian India & Middle East Indonesia, Malaysia, Deputy General Manager Peter Chew Cheng Ming Thailand, Philippines (Indonesia Township) Chief Executive Offi cer Linson Lim Soon Kooi (India & Middle East) Chief Executive Offi cer Alex Lee Ee Mal (Southeast Asia) Project Manager (Surabaya) Jane Low Hong Ming Assistant General Manager (Bangalore) Doan Anh Hung Steven Shum Wing On Assistant General Manager (Vietnam) Deputy General Manager Mohammad Zahid Bin Yacob (Malaysia Operations) Assistant General Manager (Jeddah) Raymond Chin Yun Choi Assistant General Manager Roy Cheng Li-Wang Tay Ser Chye, Lionel (Ho Chi Minh City Operations) General Manager, Senior Manager (Kolkata) Keppel Thai Properties Public Peter Kuan Teck Sing Company Limited Myanmar Assistant General Manager Ong Tiong Beng (Vietnam Townships) Lee Foo Tuck Chief Executive Offi cer Senior Vice President, (Township & Waterfront Developments) Wong Yew Siong Keppel Philippines Properties Inc. Senior Manager (Hanoi) Vincent Tan Aik Cheong Assistant General Manager (Myanmar) Lim Seng Bin Senior Vice President, General Manager (Indonesia) Sedona Hotels International Pte Ltd

Key Personnel 31 Corporate Governance

The Company’s Directors and Board Matters The Board meets regularly on a quarterly Management fi rmly believe that a full The Board’s Conduct of Affairs basis and as warranted. Directors are free commitment to high standards of Principle 1: Effective Board to Lead to discuss and voice their concerns on corporate governance is essential to and Control the Company any matter raised at the Board meetings. safeguard shareholders’ interests and The Board oversees the effectiveness Telephonic and video-conferencing maximise long-term shareholder value. of Management as well as the corporate meetings of the Board are allowed under governance of the Company with the the Company’s Articles of Association. Effective corporate governance supports objective of maximising long-term the Company’s belief in transparency, shareholder value. Each individual Upon appointment of each Director, a and helps it to be forward-looking with Director is obligated to act in good formal letter setting up his or her duties fresh ideas, and to be more decisive in faith and consider the best interests of and responsibilities is issued to the the execution of strategies and initiatives. shareholders at all times. Director. Directors are given appropriate It is also an effective prevention against briefi ngs by the Management on the frauds and irregularities. The key roles of the Board include the business activities of the Group, its review and approval of the Group’s strategic directions, and the Company’s These standards include having clear corporate strategies and directions, corporate governance policies and policies, best practices, and sound annual budgets, major investments, practices when they are fi rst appointed internal controls as well as a system of divestments and funding proposals, to the Board. They are updated regularly continuous improvements. and the review of the Group’s fi nancial on accounting and regulatory changes, performance, risk management and are also given further appropriate The Company has received many awards processes and systems, human resource training from time to time. for achieving high standards in its requirements and corporate governance corporate governance and transparency. practices. The Company has in place Board Composition and Information on these awards is set out fi nancial authority and approval guidelines Guidance under communication with shareholders for investments, divestments, loans and Principle 2: Strong and Independent on page 40. lines of credit. Element on the Board Presently, there are 12 Directors, As required by the Listing Manual of the The Board has a clear vision, and 11 of whom are non-executive Singapore Stock Exchange Securities sets high transparency and disclosure Directors. Eight of the 12 Directors Trading Limited (“SGX-ST”), the following standards. It ensures that obligations are independent Directors. sections describe how the Company to shareholders and other stakeholders has effectively applied the principles are understood and met. Three out of four non-independent and guidelines of Singapore’s Code of Directors (“non-ID”), namely Corporate Governance (“the Code”). Matters which are delegated to Mr Lim Chee Onn, Mr Choo Chiau Beng Board Committees for more detailed and Mr Teo Soon Hoe are considered appraisals are reported to and nominees of Keppel Corporation monitored by the Board. Limited, a substantial shareholder of the Company.

Keppel Land Limited 32 Report to Shareholders 2008 Corporate Governance Structure

Shareholders

Nominating Committee Audit Committee Board of Directors

Remuneration Committee

Board Risk Committee

Group Internal Audit Management Board Safety Committee

Property Development Hotels, Serviced Property Fund Property Services and Investment Apartments and Resorts Management

Corporate Governance 33 Corporate Governance

Directors’ attendances at the meetings of the Board and Board Committees are as shown below:

Board Committees

Board Committees Board Audit Nominating Remuneration Board Risk Board Safety

No. of meetings held 4 5 2 3 4 4

Directors No. of meetings attended

Lim Chee Onn 4

Kevin Wong Kingcheung 4

Khor Poh Hwa 3 2 4 3

Lim Ho Kee 4 2 3 4

Tsui Kai Chong 4 5 3 2

Lee Ai Ming 4 4 4

Tan Yam Pin 3 3 4

Niam Chiang Meng 4 2 2

Heng Chiang Meng 4 5 4

Edward Lee Kwong Foo 4 4

Choo Chiau Beng 4

Teo Soon Hoe 4

The Board is of the view that its current Power and Authority The Group CEO is accountable to size and composition are appropriate To ensure an appropriate balance of the Board for the conduct and and provide suffi cient diversity of power, increased accountability and performance of the Group. expertise to lead and govern the a greater capacity of the Board for Company effectively, considering the independent decision-making, the The Chairman and the Group CEO are scope and nature of its operations. Company has a clear division of not related to each other. responsibilities at the top of the Company, The Company has in place a Nominating with the non-executive Chairman and Board Membership Committee which determines the the Group Chief Executive Offi cer Principle 4: Formal and independence of each Director annually (“Group CEO”) having separate roles. Transparent Process for the based on the defi nition of independence Appointment of New Directors as stated in the Code. The Chairman leads the Board and is The main roles of the Nominating responsible for the management of the Committee (“NC”) are to make the The non-executive Directors actively Board, encourages Board’s interaction process of Board appointments and participate in setting strategy and goals with Management, facilitates effective re-nominations transparent, and to assess for the Company and in regularly assessing contribution of non-executive Directors, the effectiveness of the Board as a whole the performance of Management. Brief encourages constructive relations among and the contribution of individual Directors details of the Directors’ responsibilities the Directors, and promotes high to the effectiveness of the Board as well and qualifi cations are set out on standards of corporate governance. as to affi rm annually the independence pages 16 to 25. The Chairman also ensures that the of Directors. The NC is made up of Directors receive accurate, timely and three independent Directors. Chairman and Chief clear information and there is effective Executive Offi cer communication with shareholders. The NC has guidelines to address the Principle 3: Chairman and Chief The Group CEO has full executive issue of multiple board representations. Executive Offi cer to be Two Separate responsibilities over the business Persons to Ensure a Clear Division directions set by the Board and The NC assesses the appropriate mix of of Responsibilities and Balance of operational decisions of the Group. expertise and experience needed for an

Keppel Land Limited 34 Report to Shareholders 2008 The nature of the Directors’ appointments on Board and the details of their memberships in the Board Committees are set out below: Committees Membership

Board Directors Membership Audit Nominating Remuneration Board Risk Board Safety Non-executive Lim Chee Onn Chairman Non-ID Group CEO Kevin Wong Kingcheung Non-ID Khor Poh Hwa ID Member Member Member

Lim Ho Kee ID Chairman Member Member

Tsui Kai Chong ID Chairman Member Member

Lee Ai Ming ID Member Member

Tan Yam Pin ID Chairman Chairman

Niam Chiang Meng ID Member Member

Heng Chiang Meng ID Member Chairman

Edward Lee Kwong Foo ID Member

Choo Chiau Beng Non-ID

Teo Soon Hoe Non-ID

effective Board that would add value to allow comparison with industry peers and report to the members of the NC and the the Company and recommends the the Company’s share price performance Chairman of the Board for discussion. candidates most suited for the positions over a ﬁ ve-year period vis-à-vis the Thereafter, the independent co-ordinator taking into account factors such as their Singapore Straits Times Index and a will discuss the ﬁ nal consolidated report track records, experience, age and benchmark index of its industry peers. with the Chairman of the NC and the capabilities. The candidates may Chairman of the Board so that they may be selected through contacts, The process of evaluating the provide the Board with the necessary recommendations as well as performance of the Board and feedback with a view to improving search companies. individual Directors is as follows: Board performance. (a) The questionnaire for the annual The Directors submit themselves for evaluation of the Board is completed Access to Information and re-election at regular intervals of about by all Board members; Accountability once every three years. One-third of (b) The evaluation of individual Directors’ Principle 6: Board Members to the Directors retire at the Company’s performance is done once a year have Complete, Adequate and Annual General Meeting each year. also by Directors on a self and peer Timely Information evaluation basis; Board Performance (c) The evaluation of individual Directors Principle 10: The Board’s Principle 5: Formal Assessment of is differentiated for executive and Accountability to the Shareholders the Effectiveness of the Board as non-executive Directors; and and Management’s Accountability a Whole and the Contribution by (d) The Chairman’s performance is to the Board Each Director evaluated annually by non-executive The NC has implemented a process for Directors. Management provides the Board with evaluating the effectiveness of the Board complete, accurate and adequate as a whole and the contribution by each The whole evaluation process is managed information in a timely manner in individual Director to the effectiveness by an independent co-ordinator. The recognition of its obligation to do so. of the Board. The NC sets objective independent co-ordinator will consolidate The provision of such information, e.g. performance criteria for evaluation which the evaluation returns and present a management accounts on a monthly

Corporate Governance 35 Corporate Governance

The years of initial appointment and re-election of the Directors are set out in the table below:

Directors Position Age Date of Appointment Date of Last Re-election

28 October 1983 Non-executive Director Lim Chee Onn 64 25 April 2008 Chairman 1 January 1997 Chairman 1 November 1993 Executive Director 1 January 2000 Kevin Wong Kingcheung Group CEO 53 27 April 2007 Managing Director and re-designated Group CEO Khor Poh Hwa Director 59 1 April 1998 27 April 2007 Lim Ho Kee Director 63 8 November 2001 25 April 2008 Tsui Kai Chong Director 53 8 November 2001 25 April 2008 Lee Ai Ming Director 54 1 November 2001 28 April 2006 Tan Yam Pin Director 68 1 June 2003 25 April 2008 Niam Chiang Meng Director 51 1 June 2003 27 April 2007 Heng Chiang Meng Director 63 1 March 2005 25 April 2008 Edward Lee Kwong Foo Director 62 1 July 2006 27 April 2007 Choo Chiau Beng Director 61 21 January 1985 28 April 2006 Teo Soon Hoe Director 60 16 May 1991 28 April 2006

basis, enables the Directors to keep followed and that applicable rules and Remuneration Matters abreast of the Group’s operational and regulations, including the requirements Procedures for Developing ﬁ nancial performance and position. of the Companies Act, are complied Remuneration Policies Management also updates the Board on with, with the assistance of the relevant Principle 7: Formal and Transparent key issues and prospects of the Group. senior managers. The Company Procedure for Fixing the Secretary attends all Board meetings. Remuneration Packages of As a general rule, Board papers are sent The appointment and the removal of Individual Directors to Directors about seven days before the Company Secretary are subject to Board meetings so that Directors may approval of the Board. Level and Mix of Remuneration better understand the matters before Principle 8: Remuneration of Directors the meetings, and the Board meeting The Board takes independent to be Adequate and Not Excessive time may be conserved and discussion professional advice as and when time focused on questions that the necessary to enable it or the independent Disclosure of Remuneration Directors may have on the Board papers. Directors to discharge its or their Principle 9: Clear Disclosure responsibilities effectively. Subject to on Remuneration Policy, Level Managers who can provide additional the approval of the Chairman, Directors and Mix of Remuneration, insight into the matters to be discussed may seek and obtain independent and the Procedure for Setting will be present at the relevant time during professional advice to assist them in Remuneration the Board meetings. The Directors are their duties. The cost of such advice is provided with the names and contact borne by the Company. The Remuneration Committee (“RC”) details of the Company’s senior managers consists of three independent Directors. and the Company Secretary to facilitate The Board is committed to provide They are responsible to approve the direct access to Management and the shareholders with a balanced and framework of remuneration for the entire Company Secretary. understandable assessment of the Group and review the appropriateness, Company’s ﬁ nancial performance, transparency and accountability to The Company Secretary is responsible position, and prospects. shareholders on the remuneration issues for ensuring that Board procedures are of the Directors and senior managers in

Keppel Land Limited 36 Report to Shareholders 2008 the Company. The aim of the RC is to from the date of grant. To enable it to During the year, the AC performed motivate and retain Directors and carry out its duties, the RC has access independent reviews of the fi nancial executives, and ensure that the Company to expert advice in the fi eld of executive statements of the Company before the is able to attract and retain the best compensation inside and/or outside the announcements of the results. The talent in the market to drive the Group’s Company, where necessary. During the reviews included an assessment of the businesses forward in order to maximise year, the RC had external consultants to quality of key accounting principles long-term shareholder value. continue the review of the compensation applied and Management’s judgements framework and package for the Group which have a major impact on the No member of the RC or any other CEO and senior managers. fi nancial statements. On a quarterly basis, Director will be involved in deliberations Management reported to the AC all in respect of any remuneration, No employee of the Company and its interested person transactions (“IPTs”) compensation, option or any form of subsidiaries was an immediate family in accordance with the Company’s benefi ts to be granted to him or her. member of any Director and whose shareholders’ mandate for IPTs. The IPTs remuneration exceeded $150,000 during were audited by the internal auditors on The RC will recommend to the Board the fi nancial year ended 31 December a semi-annual basis, and their fi ndings the specifi c remuneration packages for 2008. “Immediate family member” means reported to the AC. the Directors upon their recruitments the spouse, child, adopted child, and review Directors’ fees annually. stepchild, brother, sister and parent. The AC has full access to and co- Directors’ fees are established annually operation by Management and full for the Chairman and the other Directors. Internal Control and Audit discretion to invite any Director or Additional fees are paid, where applicable, Audit Committee executive offi cer to attend its meetings, for participation in Board Committees. Principle 11: Establishment of and has reasonable resources to enable The level of fees takes into account the Audit Committee with Written it to discharge its functions properly. size and complexity of the Company’s Terms of Reference operations, and the responsibilities and The Audit Committee (“AC”) consists The AC held fi ve meetings during the year. workload requirements of Directors. The of three independent members. The The members’ attendances at these fees are submitted to shareholders for members bring along with them meetings are disclosed on page 34. approval at each Annual General Meeting. invaluable experience and professional The external and internal auditors, the expertise relating to accounting, fi nancial Group CEO, the Director, Corporate The RC also reviews the remuneration management and legal knowledge. Services and the Chief Financial Offi cer of senior management annually. For the were invited to attend its meetings. The Group CEO and other senior managers, The AC is guided by written terms of Company’s internal auditors and external the Company advocates a performance- reference. The roles of the AC include, auditors report their audit fi ndings and based remuneration system that is inter-alia, reviewing the annual audit plans recommendations independently to fl exible and responsive to the market from both external and internal auditors, the AC. and the Company’s business units and internal audit processes, adequacy of individual performances. internal controls, interested person Internal Controls transactions, and the audit and other Principle 12: Sound System of The total remuneration mix for the Group fees of external auditors, and their Internal Controls CEO and senior managers comprises independence and objectivity. The AC Audit Committee three key components, namely annual also reviews quarterly and full-year results The AC reviews the reports submitted fi xed cash, annual performance incentive prior to their submission to the Board for by the external and internal auditors and long-term incentive. The annual approval, and meets with the external relating to the effectiveness of the fi xed cash component comprises the and internal auditors at least once a year Company’s material internal controls, annual basic salary plus any other fi xed without the presence of Management. In including fi nancial, operational and allowances. The annual performance addition, the AC Chairman will review and compliance controls, risk management, incentive is tied to the Company’s and investigate, as appropriate, any protected and risks of fraud and irregularities. The individual manager’s performances. report raised under the Company’s AC also reviews the effectiveness of the The long-term incentive is presently whistle-blower protection policy. actions taken by Management on the in the form of share options or carried recommendations made by the internal interests as the case may be, which are The AC reviews the internal and external and external auditors in this respect. The granted based on individual manager’s auditors’ plans and fi ndings to ensure Board is satisfi ed that there are adequate performance and contribution. Under they are suffi cient to assess the adequacy internal controls in the Company. the share option scheme, the participants and effectiveness of the signifi cant may exercise their options after two years internal controls of the Company.

Corporate Governance 37 Corporate Governance

The level and mix of remuneration of the Company’s Directors and top senior managers for the year ended 31 December 2008 are as follows:

Remuneration Band Base/Fixed Annual Performance Director’s Share Option and Name Salary Incentive/Carried Interest Fee Granted

(A) Directors

Above $2,000,000 to $2,250,000 Kevin Wong Kingcheung 39% 54% – 7%

Below $250,000 Lim Chee Onn – – 100% – Khor Poh Hwa – – 100% – Lim Ho Kee – – 100% – Tsui Kai Chong – – 100% – Lee Ai Ming – – 100% – Tan Yam Pin – – 100% – Niam Chiang Meng – – 100% – Heng Chiang Meng – – 100% – Edward Lee Kwong Foo – – 100% – Choo Chiau Beng – – 100% – Teo Soon Hoe – – 100% –

(B) Top Senior Managers

Above $1,250,000 to $1,500,000 Loh Chin Hua 46% 54% – –

Above $1,000,000 to $1,250,000 Ang Wee Gee 46% 44% – 10%

Above $500,000 to $750,000 Tan Swee Yiow 47% 40% – 13% Augustine Tan Wee Kiong 46% 40% – 14% Choo Chin Teck 51% 24% – 25% Lim Kei Hin 48% 38% – 14%

Keppel Land Limited 38 Report to Shareholders 2008 The system of internal controls established The BRC is supported by the ERMC The key role of Group Internal Audit is by the Company is designed to manage, comprising all the heads of department. to assist the AC to provide reasonable rather than eliminate, the risk of failure in The ERMC reports to the BRC quarterly assurance that the Company is maintaining achieving Company’s goals and objectives. to ensure that the actions to mitigate an adequate system of internal controls There are clear policies and procedures or reduce the risks that have been by periodic reviews of material controls in ensuring adequacy of controls and identifi ed have been implemented, and and procedures to test their effectiveness. effective management of risks. However, to report on the effectiveness of the it should be recognised that such system actions or improvements to the risk To ensure that internal audits are is designed to provide reasonable mitigating actions. The ERMC reports performed by competent professionals, assurance, but is not an absolute the mitigating actions taken to control Group Internal Audit employs qualifi ed guarantee, against material the top 10 risks of the Group to the staff, including a number of Certifi ed misstatement or loss. BRC also on a quarterly basis. Internal Auditors. They are provided with adequate training and development in The Company has put in place a The BRC held four meetings during the order that their technical knowledge shareholder value-based internal control year. The members’ attendances at these remains current and relevant. system in areas such as fi nancial, meetings are disclosed on page 34. operational and compliance controls, Group Internal Audit is committed to and risk management. The principal Board Safety Committee meet or exceed the Standards for the aim of the internal control system is The Company’s Board Safety Committee Professional Practice of Internal Auditing the management of business risks with (“BSC”), which consists of four set by The Institute of Internal Auditors a view to safeguarding shareholders’ independent Directors, meets regularly Inc, which has its headquarters in USA, investments and the Company’s assets. at least four times a year and guides and has incorporated them into its audit The system includes, inter-alia, enterprise Management to enhance the Group’s practices. A quality assurance programme risk management and internal auditing. commitment to work safety in all comprising continuous internal and regular The Board monitors the Company’s workplaces and to foster a safety independent external assessments is in risks through the Board Risk Committee culture in the Company. The BSC is place to ensure that audits are performed (“BRC”), AC, Enterprise Risk Management supported by the Management Safety in accordance with The Institute’s Committee (“ERMC”) and Group Committee. standards. Internal Audit. The role of BSC includes monitoring Using a risk-based audit methodology, The Company also has a whistle-blower Group’s compliance with and effectiveness Group Internal Audit plans its internal protection policy to encourage the of the approved health and safety (“H&S”) audit assignments annually in consultation reporting in good faith of suspected policies, ensuring that the approved with, but independent of, Management. reportable conduct by establishing clearly H&S polices are aligned with the H&S Its plan is submitted to and approved defi ned processes through which such practices in the industry in which the by the AC. reports may be made with the confi dence Group operates, receiving reports that employees and other persons concerning H&S incidents within the Based on the risk assessment conducted making such reports to the employees’ Group, and considering any H&S issue by Group Internal Audit, activities within supervisors, AC Chairman or Head of that may have strategic, business and the Group are reviewed at appropriate Group Internal Audit will be treated fairly reputational implications for the Group. intervals and with greater emphasis on and, to the extent possible, protected higher risk activities. Internal audit plans from reprisal. The policy and contact The BSC held four meetings during the are also aligned with the Company’s risk details of AC Chairman and Head of year. The members’ attendances at these management programme. The aim is to Group Internal Audit have been made meetings are disclosed on page 34. ensure that an effective and effi cient available to all employees. control environment is in place to manage Internal Audit those risks exclusive to a particular Board Risk Committee Principle 13: Independent Internal business unit in addition to those that The Company’s BRC, which consists Audit Function may be relevant on an enterprise-wide of fi ve independent Directors, meets The Company has its own in-house basis. regularly at least four times a year to Internal Audit Department (“Group review and guide Management on the Internal Audit”) that is independent of A comprehensive progress report is Group’s risk profi le, the Company’s the activities it audits. Group Internal presented by Group Internal Audit to processes to identify and manage Audit reports directly to the Chairman the AC at each scheduled meeting. All signifi cant risks, risk mitigation of the AC and administratively to the audit reports are distributed to the AC, strategies and risk policies. Chief Financial Offi cer. the Chairman of the Board, the Group

Corporate Governance 39 Corporate Governance

CEO, the Director, Corporate Services, (Properties Category) at the SIAS questions. The Chairmen of the Board the Chief Financial Offi cer and other (Singapore Investors Association of Committees and the external auditors relevant senior management staff. Singapore) Investors’ Choice Awards are required to be present at the 2008. The Company also won the Best meeting to assist in addressing relevant The AC ensures that the internal audit Corporate Governance (4th position) and queries from the shareholders. function has adequate resources and Singapore Best Managed Company appropriate standing within the Company. (5th position) in the FinanceAsia’s Best Each item of special business included in On an ongoing basis, it assesses the Managed Companies Poll 2008. the notice of the meeting is accompanied effectiveness of the internal auditors, by an explanation for the proposed such as its scope of work and quality In addition, the Company’s top resolution. Separate resolutions are of audit reports. management takes an active role in proposed for substantially separate investor relations, meeting local and issues at the meeting, and the Chairman Communication with Shareholders foreign fund managers regularly as declares the number of proxy votes Principle 14: Regular, Effective well as participating in roadshows and received for and against the resolutions. and Fair Communication with conferences overseas. The Company Shareholders has a dedicated Investor Relations and The Company also prepares detailed Research Department which meets minutes of general meetings, which Principle 15: Greater Shareholder key institutional investors and analysts include substantial comments or Participation at Annual on a regular basis, as well as answers queries from shareholders and General Meetings queries from shareholders. responses from the Board and Management. These minutes are In line with the continuous disclosure Pertinent information is communicated available to shareholders upon request. obligations of the Company, pursuant to to shareholders on a timely basis. Where the Code, the Listing Rules of the SGX-ST there is inadvertent disclosure made to a Security Transactions and Singapore’s Companies Act, the selected group, the Company will make The Company has issued a policy Board’s policy is that shareholders are the same disclosure publicly to all others on dealings in the securities of the informed of all major developments that as soon as practicable. Communication Company and its listed subsidiaries to impact on the Company. The Company is made through SGX-ST announcements its Directors and employees, setting out had in operation during the year, a and press releases on fi nancial results the implications of insider trading and continuous disclosure process to ensure and major developments of the Company, guidance on such dealings. It has adopted compliance with the Company’s continuing the Company’s summary fi nancial reports the Best Practices Guide on Dealings in disclosure and reporting obligations. and annual reports, notices and Securities issued by the SGX-ST. The explanatory circulars for annual general Company prohibits its Directors and Shareholders are provided with quarterly meetings and extraordinary general employees from trading in the Company’s and annual fi nancial results within meetings, and other disclosures and securities for the period commencing 30 days of the end of each quarter and announcements to SGX-ST and the press, two weeks before the announcement fi nancial year-end. The Board believes as well as through the Company’s website of quarterly results, and the period that the timely release of such fi nancial at www.keppelland.com.sg from which commencing one month before the statements is important as it enables the shareholders can access information announcement of year-end results. shareholders to receive information on the Company. on the performance, position and Interested Person Transactions prospects of the Company regularly The website provides, inter alia, corporate Disclosure of interested person and promptly. announcements, press releases, annual transactions is set out on page 41 reports, and profi les of the Group. The in the annual report. When a potential The Company believes that it should Company’s ten-year fi nancial profi le is confl ict of interest arises, the Director engage in regular, effective and fair also provided. Where appropriate, queries concerned takes no part in discussions communication with shareholders. For its over the website are also addressed. nor exercises any infl uence over other efforts at good corporate transparency, members of the Board. the Company was ranked third out of 703 The annual general meeting is the principal companies surveyed in the 2008 Business forum for dialogue with shareholders. At Times Corporate Transparency Index each annual general meeting, the Board which ranks companies for transparency encourages shareholders to participate in the disclosure in their fi nancial results. in the question and answer session. The The Company took the runner-up award Chairman and, where appropriate, the again for The Most Transparent Company Group CEO respond to shareholders’

Keppel Land Limited 40 Report to Shareholders 2008 Interested Person Transactions

Aggregate Value of all Interested Person Transactions during the Period under Aggregate Value of Review (excluding Transactions less all Interested Person than $100,000 and Transactions Conducted Transactions Conducted under Shareholders’ Mandate Pursuant under Shareholders’ Mandate Pursuant Name of Interested Person to Rule 920 SGX-ST Listing Manual). to Rule 920 of SGX-ST Listing Manual.

2008 2007 2008 2007 $ ’000 $ ’000 $ ’000 $ ’000 (a) Property transactions – Keppel Corporation Limited Group:

Project and development management fees – – 3,111 6,834 Property management fees – – 1,833 1,289 Marketing commission – – 2,736 19,931 Management and support services – – 862 2,554 Asset management fees – – 12,892 10,770 Rent expenses – – (2,879) (2,114)

– – 18,555 39,264

(b) Other services and products – Keppel Corporation Limited Group:

Treasury – interest income – – 801 2,189 Treasury – interest expenses – – (17,069) (58,521) Management fees paid – – (2,963) (5,276) Other services – – (1,211) (634)

Temasek Group:

Management fees paid (416) (486) – –

Consideration for sales of units in Singapore and overseas residential developments to Directors of the Company and their immediate family members – 4,709 – –

Interested Person Transactions 41 Investor Relations

Keppel Land employs proactive communication to engage its stakeholders for strong and enduring relationships.

Keppel Land’s corporate governance is underpinned by a strong culture of transparency and timely disclosure.

Keeping Shareholders and Apart from quarterly results Global Financial Crisis Posed Investors in the Know announcements, management and the Challenges Keppel Land constantly strives to put Investor Relations (IR) team provide 2008 has been a challenging year for in place best-in-class investor relations updates on the Company’s strategies, Keppel Land’s senior management and practices to foster strong and long-term projects’ progress and insights into the the IR team as the US subprime crisis relationships with its shareholders and various markets. For instance, responding deepened and escalated into a full- investors to build continued confi dence to concerns that the Vietnamese Dong blown global economic crisis. in the Company. would be devalued, the Company disseminated a presentation in July The series of events – from the collapse The Company takes a proactive 2008 giving details of Keppel Land’s of Bear Stearns in March 2008 to the approach and regularly engages in timely history of operations in the country bailout of Fannie Mae and Freddie Mac, communication with its shareholders, and its cash fl ow position. the collapse of Lehman Brothers and the investors, analysts, fund managers, the near-collapse of insurance giant AIG in media and the general public. September – rocked the world’s fi nancial

Keppel Land Limited 42 Report to Shareholders 2008 markets and eroded investors’ conﬁ dence. As global equity markets plummeted, the Singapore stock market was also affected. Keppel Land’s share price came under pressure as broking houses pared down earning forecasts and valuations due to weaker property markets, raising fears of write-downs and debt reﬁ nancing risks among property players.

Senior management and the IR team made efforts to address these concerns and reassure the investment community of the Company’s fi nancial health, especially on its cash fl ow positions. In addition, they also clarifi ed on these issues with the media. Discipline and prudent risk management has helped Keppel Land weather many past crises and emerge stronger from these experiences.

Maintaining an Open-Door Policy Keppel Land engages regular two-way communication with buy-side and sell- side analysts as well as fund managers. One-on-one meetings, post-results luncheon meetings and conference calls Regular briefi ngs are conducted for press and analysts. are carried out throughout the year. In 2008, management had about 130 meetings with analysts and fund Shanghai and The Botanica in Chengdu, attended by many shareholders and managers in Singapore. China as well as The Estella, Saigon observers, there was open discussion Centre and other sites in Ho Chi Minh and lively dialogue among shareholders, Apart from its regular roadshows to City, Vietnam. the Board of Directors and senior meet up with shareholders in the UK, management. US, Europe and Hong Kong, conferences Keppel Land holds press and analysts’ organised by local and foreign brokers briefi ngs twice a year for the Company’s Timely and Fair Disclosure are an effective way for management half-year and full-year fi nancial results, Keppel Land disseminates all to meet many fund managers in one where analysts and the media can announcements, press releases location. Keppel Land participated in 10 engage and clarify issues with and presentation slides via SGXNET investor conferences and roadshows in senior management. to the Singapore Exchange and Singapore, the UK, US and Hong Kong, simultaneously on its corporate website meeting about 400 fund managers. Research reports written by analysts as www.keppelland.com.sg to ensure well as feedback from fund managers timely and fair disclosure. As a major developer in Asia, Keppel Land and investors post-meetings provide receives requests from analysts and fund senior management with insights into As more investor relations’ queries are managers to visit the Company’s projects the investment community’s views received via the corporate website, in Singapore and overseas. Such site visits of the Company which are useful for the Company will unveil a new corporate allow the Company to showcase its managing market expectations and website with a fresh look and improved quality projects and offer analysts and formulation of corporate policies. functionality in the second quarter fund managers a better understanding of 2009. of the markets. Projects visited during the Keppel Land held its Annual General year included Refl ections at Keppel Bay Meeting (AGM) at the Hotel Diverse Shareholder Base and One Raffl es Quay in Singapore, InterContinental Singapore on 25 April Analysis of Keppel Land’s share register 8 Park Avenue and Villa Riviera in 2008. The AGM, which was well showed that institutional investors made

Investor Relations 43 Investor Relations

up about 30% of the Company’s total Transparency Index. Based on the latest At the Investors’ Choice Awards shareholding as at mid-January 2009. ranking published on 12 May 2008, the organised by the Securities These institutional investors are well Company was ranked third among Investors Association (Singapore), diversiﬁ ed across more than 60 cities 704 listed companies in Singapore for Keppel Land was awarded runner- in North America, Europe, Australia, its disclosures. up for The Most Transparent Singapore and other parts of Asia. Company under the Properties Keppel Land was also a winner in the category. This is the ninth time Such diversity enhances liquidity and FinanceAsia Best Managed Companies running that the Company has won mitigates over-concentration risk. Poll. The Company was rated Best this award. Management will continue to engage Managed Company (5th position), Most existing shareholders, as well as attract Committed to Corporate Governance Looking Ahead and cultivate potential new investors. (4th position) and Best Investor While 2009 is expected to be another Relations (8th position) in Singapore. challenging year, Keppel Land will Accolades for Corporate The Company was also the only continue to work hard towards Transparency and Governance developer in the top 10 under the strengthening its relationships with Good corporate transparency and Best Investor Relations category. shareholders and investors. governance form an integral part of Keppel Land’s corporate culture. Its Keppel Land was also awarded Under the current challenging commitment to high standards of the Certiﬁ cate of Excellence at the environment, it is even more crucial corporate disclosure and governance annual Investor Relations Magazine for the Company to maintain has won the Company several awards South East Asia Awards. The award active communication with its during the year. benchmarks the Company’s investor shareholders and investors, and relations amongst the best practices in ensure up-to-date information Keppel Land has been consistently the region for its disclosure as well as is provided on a timely and ranked among the top few companies active engagement of shareholders. consistent basis. in the Business Times Corporate

Market knowledge and insights are shared with analysts in Singapore and overseas to keep them abreast of activities and developments.

Keppel Land Limited 44 Report to Shareholders 2008 2008 Investor Relations Calendar

Q1 2008 Q2 2008 • Announcement of FY2007 results • Announcement of 1Q2008 results with press and analysts’ brieﬁ ng • Annual General Meeting • Investor roadshow to Hong Kong • Participation in Citigroup Asia • Participation in Citigroup Global Paciﬁ c Property Conference Property Conference in the United States • Participation in CLSA Corporate Access Forum • Hosting of site visits in Shanghai and Chengdu in China, as well as • Participation in Deutsche Bank Ho Chi Minh City (HCMC) Asian and Australia Property in Vietnam for analysts and Conference in Hong Kong fund managers • Hosting of site visits in Shanghai and HCMC for analysts and fund managers

Q3 2008 Q4 2008 • Announcement of 1H2008 results • Announcement of 3Q2008 results with press and analysts’ brieﬁ ng • Participation in Morgan Stanley • Investor roadshows to the Asia Paciﬁ c Summit United Kingdom and Europe • Hosting of site visits in HCMC • Participation in DBS Vickers Pulse and Singapore for analysts and of Asia Conference fund managers

• Participation in CIMB-GK Singapore Corporate Day Conference

• Participation in BNP Paribas Securities Asean Conference

• Hosting of site visits in HCMC for analysts and fund managers

Investor Relations 45 Awards and Accolades

Keppel Land continues to garner international recognition and repute for setting industry benchmarks for excellence.

Corporate Awards 1. Best Ofﬁ ce/Business Developer 9. 1st runner-up for Best Developer Bagged 11 Awards at Prestigious in Singapore (Overall) in Vietnam Euromoney – Liquid Real Estate 2. Best Mixed-Use Developer 10. 1st runner-up for Best Residential Awards 2008 in Singapore Developer in Vietnam Keppel Land clinched a total of 3. 1st runner-up for Best Developer 11. 2nd runner-up for Leisure/Hotel 11 awards at the Euromoney – in Singapore Development in Singapore Liquid Real Estate Awards 2008 which 4. 1st runner-up for Best Residential recognises the best in the global real Developer in Singapore Ranked among Best Managed estate industry. Ranked by a select 5. 1st runner-up for Best Retail/ Companies by FinanceAsia audience of senior decision makers Shopping Developer in Singapore Keppel Land emerged with three top in the global real estate and major 6. Best Ofﬁ ce/Business Developer accolades from FinanceAsia’s Best corporate end-users in over 50 in Vietnam Managed Companies Poll 2008. countries worldwide, Keppel Land 7. B e st R et a i l / S h o p p i n g D eve l o p e r The Group won recognition in was awarded the following in Vietnam the categories of Singapore’s prestigious awards: 8. Best Mixed-Use Developer Best Managed Company (5th), in Vietnam Best Corporate Governance (4th), and Best Investor Relations (8th).

Corporate Transparency Awards Ranked 3rd out of 704 Companies in the Business Times Corporate Transparency Index Keppel Land has been consistently ranked top ﬁ ve in the Business Times Corporate Transparency Index (BT-CTI), which rates Singapore’s listed companies on the quality of their ﬁ nancial disclosures and presentation. In the latest issue published in May 2008, Keppel Land ranked third out of 704 companies.

SIAS Most Transparent Company Award (1) Keppel Land took the runner-up award for the Most Transparent Company under the Properties category at the SIAS Investors’ Choice Awards Presentation held in October 2008. This is the ninth time running that the (1) Company has won the award.

Keppel Land Limited 46 Report to Shareholders 2008 (2)

Organised by the Securities Investors Green Awards LEED (Leadership in Energy and Association (Singapore) (SIAS), the award Achieved ISO 14001 Environmental Design) scheme. recognises listed companies that have Certifi cation for Singapore excelled in corporate governance and Projects Green Mark Platinum Award for transparency practices. All award winners Keppel Land achieved the ISO 14001 Ocean Financial Centre were selected by the committees formed Environmental Management System Ocean Financial Centre (OFC) is the by the SIAS comprising corporate (EMS) certifi cation for the development fi rst offi ce development in Singapore’s governance experts, investors, analysts, of its commercial and residential central business district to be conferred fund managers and fi nancial journalists. properties in Singapore in 2008. the highest Platinum Green Mark Award. An internationally recognised standard Innovative green technology and immense Clinched Certifi cate of Excellence for environmental management, efforts have gone into developing OFC at IR Magazine SEA Awards 2008 ISO 14001 provides organisations with as a sustainable building. Keppel Land also clinched the a structured framework for managing Certifi cate of Excellence at the annual and controlling activities which may Through its green features, OFC will see Investor Relations (IR) Magazine South have impact on the environment. The an overall energy savings of 35% or East Asia (SEA) Awards 2008 held in certifi cation is a testimony of Keppel 9.09 million kilowatt hours a year. November 2008. The award recognises Land’s efforts in attaining excellence in companies for their transparency environmental performance and striving Among its winning green features are as well as active and effective towards environmental sustainability. a solar paneled array with effi cient engagement of shareholders. lighting panels and air-conditioning, and BCA Green Mark Awards an integrated paper recycling facility. Winners were determined based on Conferred for Four Buildings(2) the results of an independent survey of Four of Keppel Land’s buildings were Green Mark Gold Award for over 5,000 investors and analysts from conferred the Green Mark awards Refl ections at Keppel Bay Asia. The annual IR Magazine SEA by the Building and Construction Refl ections at Keppel Bay was awarded Awards are widely respected amongst Authority (BCA) in 2008, bringing the the Green Mark Gold Award in 2008. the global IR community. IR Magazine total of Green Mark awards the Group The premier development incorporates is a monthly UK-based publication with has obtained since the scheme was green and energy-saving features such more than 20 years of establishment introduced in 2005 to six. The BCA as the provision of motion sensors at and is one of the most esteemed Green Mark rating is Singapore’s lift lobbies and clubhouse toilets, a industry publications. equivalent of the United States’ pneumatic waste collection system as

Awards and Accolades 47 Awards and Accolades

well as green roofs and green walls at Accredited by the Singapore Recognition for Excellence in the substation and tennis courts. Environment Council, the certifi cation Product Quality in Singapore is an extension of ongoing efforts at Best New Asian Marina / Yacht Green Mark Gold Award for Keppel Land to spread environmental Club of the Year Marina Bay Financial Centre awareness and inculcate long-term Marina at Keppel Bay was named Best Phase One (Commercial) sustainability development principles. New Asian Marina/Yacht Club of the Marina Bay Financial Centre (MBFC) These include reduction in paper usage Year at the prestigious Christofl e Asia Phase One (Commercial) received the and promotion of paper recycling, Boating Awards 2008, beating seven Green Mark Gold Award in 2008. This energy and water conservation, waste other new marinas from Dubai, China, follows a similar award for Marina Bay recycling, environmentally-friendly Thailand and Singapore. Residences, also within the development, purchasing policies, reduction in vehicle in 2007. usage and enhancing environmental This is the fi rst year that the award awareness in staff. was introduced as part of the annual MBFC Phase One (Commercial) employs Christofl e Asia Boating Awards which construction techniques which will save Finalist in ACCA SESRA Awards is widely known as the region’s premier 240,000 cubic metres of water or the Keppel Land emerged as a fi nalist event for recognising the efforts of boat equivalent of 117 Olympic-sized pools in the Singapore Environmental and builders, marinas, clubs and individuals as well as a host of energy conservation Social Reporting Awards (SESRA) in creating a diverse and exciting boating features including an energy-effi cient organised by the Association for community. It has also become a must- glass curtain cladding system, and Chartered Certifi ed Accountants (ACCA) attend event for Asia’s jetset. Marinas energy-saving air-conditioning, lighting for the third time. SESRA recognises were assessed by a panel of 20 industry and lift systems. In addition to the green companies that display an exceptional experts from around the region on the technology employed, more than 35% of effort in reporting their non-fi nancial facilities, berthing systems, procedures the total land area will be landscaped, disclosures to their stakeholders. It aims and systems and overall service standards. creating relaxing surroundings for tenants to promote good corporate citizenship and cooling the urban environment. and encourage companies to be more Clean Marina Award(3) accountable for the social, environmental Marina at Keppel Bay received the Green Mark Gold Award for and economic impact of their activities. Clean Marina Award from the Marina The Estella in HCMC, Vietnam The Estella in Ho Chi Minh City (HCMC) is the fi rst development in Vietnam to receive the Green Mark Gold Award. Incorporating the latest green technology, the 1,393-unit high-end condominium development is expected to yield annual savings of 23% and 48% in energy and water consumption respectively, which amounts to estimated cost savings of over $850,000 annually.

Among the green initiatives at The Estella are solar roof panels, use of low volatile organic compound paint and low emission formaldehyde composite wood, as well as laminated glass windows and doors, natural ventilation-enabled interiors and roof and sky gardens for a cooler and quieter environment.

Green Offi ce Certifi cation Efforts at Keppel Land to push for a greener workplace earned the Group the Green Offi ce Certifi cation in December 2008. (3)

Keppel Land Limited 48 Report to Shareholders 2008 Industries Association of Australia (MIAA). It is the ﬁ rst and only marina in Asia to be awarded the ‘Clean Marina’ status under the Clean Marinas Australia Programme, a voluntary accreditation system for marinas, yacht clubs, boat clubs, slips, boatyards and associated industry operators that originated in Australia.

This certiﬁ cation reﬂ ects the Group’s focus on sustaining the environment and safety, and is testimony that Marina at Keppel Bay has procedures that ensure its readiness in tackling with marine hazards that could potentially impact the environment.

Recognition for Excellence in Product Quality Overseas Sedona Suites HCMC bags Golden Dragon Award 2008 Sedona Suites HCMC and Villa Riviera bagged the prestigious Golden Dragon Award in the real estate services and construction categories respectively. Jointly conferred by Vietnam’s Ministry of Planning and Investment and reputed (4) business newspaper Vietnam Economic Times, the Golden Dragon Award recognises companies for product and Hotel Sedona Manado won the award on Ria Bintan Wins Recognition for service excellence, as well as their its fi rst nomination within just two years Environmental Efforts contribution to Vietnam’s economy. of operation. Hailed by the Wall Street In January 2009, Ria Bintan became Journal as the travel industry’s equivalent the fi rst golf course in Indonesia to Saigon Centre Lauded for to the Oscars, the World Travel Awards be a “Certifi ed Audubon Cooperative Socio-Economic Contribution(4) recognise excellence in the world’s Sanctuary” by Audubon International for For its socio-economic contribution travel and tourism industry and are its exceptional effort in maintaining high to Vietnam between 2003 and 2007, voted by travel professionals globally. standards of environmental management Saigon Centre in HCMC, Vietnam in areas such as environmental planning, received the Medal of Labour Award Best Golf Course in Asia and wildlife and habitat management, outreach conferred by the President of the Socialist Indonesia at Ria Bintan and education, chemical use reduction Republic of Vietnam. The award was The Gary Player-designed Ocean Course and safety, water conservation and presented to Keppel Land Watco 1, the in Ria Bintan was awarded the Best Golf water quality management. joint venture company for the development. Course in Asia and the Best Golf Course in Indonesia for the fi fth consecutive year International Accolades for Hotel Sedona Manado named in 2008, while Ria Bintan Golf Club Spring City Golf & Lake Resort Indonesia’s Leading Resort was voted as one of the Top 10 Best Spring City Golf & Lake Resort was Hotel Sedona Manado was named Maintained Course in Asia for 2008 by ranked the No. 1 Golf Course in China Indonesia’s Leading Resort while the Asian Golf Monthly. (Mountain Course) and Best Golf Sedona Hotel Yangon and Sedona Resort in Asia – 1st runner-up by Asian Hotel Mandalay were nominated under Widely regarded as the Oscars of Asia’s Golf Monthly in 2008. Golf Magazine also the ‘Myanmar’s Leading Hotel’ category golf courses, the Asian Golf Monthly bestowed on it several awards including at the World Travel Awards 2008. awards pay homage to outstanding the China Top Ten Golf Course, Best Turf, establishments that have helped to and Best Scenic Golf Course, while place Asia on the world golfi ng map. China Golf Magazine named it the Most Favourite Resort.

Awards and Accolades 49 Special Feature

Managing the Business in Challenging Times

The world is heading into uncharted waters Rising from the Asian as far as the magnitude of the current Financial Crisis ﬁ nancial crisis is concerned. The Asian Financial Crisis, triggered by the devaluation of the Baht in For Keppel Land, there is a sense of déjà vu, Thailand in July 1997, had a domino having weathered the Asian Financial Crisis in effect of tripping up other economies in the region. The economic meltdown 1997/1998, the dotcom bust and the September deteriorated into a full-blown recession 11 attacks in the United States in 2001, and the in 1998, affecting major Asian SARS outbreak in 2003. economies including South Korea, Hong Kong and Singapore.

Through each crisis, Keppel Land has emerged Like many companies with regional exposure, Keppel Land suffered the stronger and the experience puts the Company in effects of the downturn, and had to good stead to ride through the present challenge. make provisions and write-downs totalling $1 billion in 1998 (see Table A). As a result of the provisions and write-downs, a loss of $350.6 million was posted for 1998. Net gearing rose to 0.95 times for 1998.

Keppel Land Limited 50 Report to Shareholders 2008 During this diffi cult period, Keppel Land In 2000, as China joined the World As the offi ce sector rebounded in set strategic directions to Trade Organisation, Keppel Land Singapore, Keppel Land together made its fi rst foray into the residential with Hong Kong property developers • Focus on trading projects for segment in the country with the Cheung Kong (Holdings) and quicker returns instead of purchase of three adjoining sites in Hongkong Land, won a tender for longer-term investment projects a residential enclave in the prime a 1.14-ha site in Marina South in • Grow overseas assets to 30% Jingan District in Shanghai. March 2001. of total assets, to diversify out of Singapore market for It also took a 24.9% stake in The acquisition of the fi rst site in the sustainable earnings growth China-focused developer, Dragon Land, new downtown set the stage for the • Move into property fund as an additional platform to enter the development of One Raffl es Quay management for fee-based China market. offi ce towers for eventual monetisation. income streams Keppel Land’s entry into the China Fortunately, led by exports growth, residential sector was timely as the Asia saw a V-shaped recovery government had started its housing in 1999. Keppel Land, too, reforms to promote home-ownership. achieved a turnaround. The merging of the foreign and domestic markets further accelerated To ride on the upturn in the region, the growth of the property market. Keppel Land positioned itself as a developer of quality homes in selected Asian cities.

Table A: Financial Position in Current and Previous Crises

Earnings were higher in 2008 than those in 1998, 2001–2003

Net debt and gearing were substantially lower compared to that in previous crisis years’

Provisions and write-downs were not required in 2008 unlike 1998 and 2001 when they were necessary:

$1 billion : $396 million for landbank on Proﬁ t and Loss account and $614 million revaluation deﬁ cit on Balance Sheet in 1998

$0.7 billion : $455.1 million for landbank on Proﬁ t and Loss account and $239 million revaluation deﬁ cit on Balance Sheet in 2001

2008 2003 2002 2001 1998

PATMI ($ million) 227.7 100.4 26.4 86.7 45.4 PATMI ($ million) – after provisions na na na -368.4 -350.6

Total equity ($ million) 2,896.9 1,693.2 1,669.9 1,860.3 2,198.8 Net debt ($ million) 1,495.5 1,600.0 1,826.3 2,416.4 2,089.2 Net debt/equity ratio (x) 0.52 0.94 1.09 0.95 0.65

Net debt/equity ratio (x) – after provisions and write-downs na na na 1.30 0.95 NTA per share ($) 3.39 2.09 2.09 3.21 4.34 NTA per share ($) – after provisions and write-downs na na na 2.23 2.80

Special Feature Managing the Business in Challenging Times 51 Special Feature

Table B: Comparing Current Crisis Against Previous Crises

2008 2003 2002 2001 1998

GDP Growth 1.1% 3.5% 4.2% -2.3% -0.8%

Residential Market

Residential Price Index 162.8 112.8 115.1 117.2 100.0

% Y-O-Y change in Residential Price Index -4.7% -2.0% -1.8% -11.7% -34.0%

New Home Sales (Units) 4,264 5,156 9,485 7,189 6,096

% Y-O-Y change in New Home Sales -71.2% -45.6% 31.9% 33.0% 10.4%

Ofﬁ ce Market

Annual take-up (million sf) 0.19 -1.13 -0.93 1.12 0.3

Average Prime Rentals ($ psf) $12.90 $4.00 $5.00 $6.30 $6.10

% Y-O-Y change in Prime Rentals -14% -20% -20.6% -16% -33%

Average Capital Values ($ psf) $2,600 $980 $1,050 $1,240 $1,436

% Y-O-Y change in Capital Values -16.1% -6.7% -15.3% -13.6% -32.5%

Overcoming 9/11 The Group also monetised $355 million Keppel Land was able to capitalise and SARS of receivables from three residential on the demand for housing with rising projects – Amaranda Gardens, affl uence, government incentives Butterworth 8 and The Edgewater. to support home ownership, low The dotcom bust and 9/11 attacks in mortgage rates and the urbanisation the US took their toll on Asia in 2001. During this period, Keppel Land refi ned process. The proportion of earnings Following the footsteps of the US and its strategic plan further to from overseas grew from 3% in 2002 Japan, Singapore slipped into its worst to 32% in 2003. recession in four decades. • Grow overseas earnings contribution to 50% by 2005 from 3% in 2002 With growing interest from Keppel Land made provisions of institutional funds in Asian real $455.1 million for its residential • Grow property fund management for estate, Keppel Land hired a team landbank and took write-downs fee-based recurring income by of experienced fund managers to of $239 million for its investment tapping on interest from institutional spearhead the development of the properties. As a result, Keppel Land funds in Asian real estate property fund management business. incurred a loss of $368.4 million, and The fund management unit was net gearing rose to 1.3 times for 2001. Although Asia’s recovery was derailed renamed Alpha Investment Partners by SARS in 2003, the strong economic (Alpha) in 2002. In 2002, Keppel Land kick-started the growth in China, India, Thailand divestment of its prime offi ce portfolio and Vietnam provided support for in Singapore with the sale of its the region. 70% stake in Capital Square.

Keppel Land Limited 52 Report to Shareholders 2008 Riding on the Upswing (2004–2007)

The bottoming out of the Singapore Residential townships were identifi ed Overseas earnings contribution rose property market in 2004 allowed as a segment that Keppel Land could to almost 60% of total earnings in Keppel Land to resume its plan build up for sustainable profi t growth. 2005, exceeding the original target to recycle capital by divesting Catering to the middle class, this of 50%. As overseas contribution grew, its investment assets and segment is less susceptible to speculation. Keppel Land enlarged its footprint channelling the resources into to India in 2004 and to Saudi Arabia development-for-sale projects. Demand is more stable as buyers are in 2007. typically end-users. Between 2005 and Keppel Land was able to spin-off 2007, The Botanica in Chengdu sold The Company also ventured into new four offi ce buildings valued at about 1,000 units a year. cities and segments in China and $630 million through the listing of Vietnam. Maiden earnings were booked K-REIT Asia, a commercial real estate The Company embarked on residential from the Company’s fi rst residential investment trust, in 2006. In 2007, township developments in Indonesia developments in India and Vietnam. Keppel Land divested its one-third and Vietnam which will provide 7,000 stake in One Raffl es Quay to and 10,000 homes respectively for the Dragon Land was renamed K-REIT Asia for a profi t of about growing middle-income group in the Evergro Properties in 2006 to refl ect its $235 million. two countries. positioning for a new phase of growth.

Special Feature Managing the Business in Challenging Times 53 Special Feature

Facing the Keppel Land’s participation in the In comparison with its position in Sino-Singapore Tianjin Eco-City will take previous crises, Keppel Land is Challenges Ahead it to the next level as a green developer. stronger this time round. Keppel Land is both shareholder of The road ahead is uncertain. However, the Singapore consortium and project As a result of Keppel Land’s disciplined the wide network of contacts, market manager of a 30-ha site within the approach to land acquisition, no intelligence and experience are 4-sq km start-up area of the Eco-City. provisions were made for its landbank strengths the Group can leverage on for 2008. As the Company has been when the economies turn around. Although the fi nancial crisis has affected consistently taking the lower end of the the market outlook for the offi ce sector, market range of the valuations for its Fortunately, Keppel Land’s strategy the Company’s joint development, investment properties, and because for sustainable growth is in place. Marina Bay Financial Centre (MBFC) it has stuck to its policy of year-end The Company will continue to focus Phase 1 and Phase 2, are already 66% revaluation, its investment properties on residential township development and 55% pre-committed ahead of their have not suffered fair value losses. and lifestyle (marina/waterfront) respective completion in 2010 and 2012. developments, sustainable The Company has a cash position developments, prime offi ce The Company has also decided to of $626 million as well as progressive development and property proceed with the development of profi ts to be booked from earlier sold fund management. Ocean Financial Centre. As the projects including Refl ections at Keppel land costs for both MBFC and Bay, Marina Bay Residences and other Keppel Land has scaled up its residential Ocean Financial Centre are low, residential developments. township developments to spread over these developments provide good six cities (Chengdu, Wuxi, Shenyang, value for future unlocking when the The Company has a net gearing ratio Jakarta, Ho Chi Minh City and Dong Nai) market recovers. of 0.52 and interest coverage ratio in three countries (China, Indonesia of 11 times at end-2008. It has and Vietnam). The Company’s fund management suffi cient fi nancial resources to business has also grown to a undertake the projects the Company Residential townships contribute sizeable one with total Assets Under has committed to. two-thirds of the Group’s total landbank Management (AUM) of $9.8 billion, of 60,000 homes across Asia and the when the funds are fully-leveraged and Finally, the Company is also able Middle East. In China, middle-income fully-invested. Apart from K-REIT Asia, to phase or delay entire projects to housing has shown early signs of which has a portfolio value of conserve cash and to control project recovery and this is borne out at $2.1 billion, Alpha’s AUM has risen to and operation costs. It will also look The Botanica in Chengdu with more $7.7 billion in 2008, when fully-invested for opportunities to monetise its assets than 250 homes sold in the fi rst quarter and fully-leveraged. as well as seize opportunities for of 2009. acquisition presented by Alpha has a stable of fi ve funds the downturn. Despite the economic slowdown, contributing a total net property income the Group remains fi rmly committed to of $115 million per annum. promoting sustainable developments.

Keppel Land Limited 54 Report to Shareholders 2008 Phase or delay projects to On the ready to conserve seize cash, and strive to opportunities from the control project and downturn as well as to operation costs monetise assets

Keppel Land’s Response

Committed to Grow fee-based fund protect management business to stakeholders’ interests through corporate sustain governance, green long-term earning streams initiatives and corporate social responsibility activities

Special Feature Managing the Business in Challenging Times 55 Financial Review

2008 2007 % Increase/ $’000 $’000 (Decrease)

Sales – excluding associated companies 842,166 1,407,886 (40.2)

Proﬁ t before taxation and fair value gain on investment properties/impairment 309,563 620,957 (50.1)

Proﬁ t before taxation but after fair value gain on investment properties/impairment 314,030 988,736 (68.2)

Proﬁ t after taxation and minority interests (PATMI) 227,669 779,650 (70.8)

Total equity (including minority interests) 2,896,934 2,643,691 9.6

Borrowings net of cash 1,495,457 1,087,471 37.5

% Increase/ 2008 2007 (Decrease)

Debt-equity ratio (%) 52 41 26.8

Earnings per share (cents) After tax but before fair value gain on investment properties/impairment 31.1 71.5 (56.5) After tax and fair value gain on investment properties/impairment 31.6 108.3 (70.8)

Return on shareholders’ equity (%) After tax but before fair value gain on investment properties/impairment 9.7 30.5 (68.2) After tax and fair value gain on investment properties/impairment 9.9 46.2 (78.6)

Gross dividend per share (cents) Proposed ﬁ nal dividend 8.0 8.0 – Proposed special dividend – 12.0 nm

Net tangible assets per share ($) 3.39 3.18 6.6

nm – not meaningful

Keppel Land Limited 56 Report to Shareholders 2008 Sales Group Sales ($ million) Group sales for the year were $842.2 million, 40.2% lower than $1,407.9 million achieved in 2007. The decrease of $565.7 million was mainly due to the completion of several 1,407.9 projects in Singapore and overseas, and lower sales reported by hotels 948.0 and resorts and property services. 842.2 However, this was partly mitigated by 586.4 476.2 new revenue streams from overseas projects and progressive revenue recognition from fully sold projects in Singapore, higher rental income from investment properties and higher fund management fees earned. 2004 2005 2006 2007 2008 Earnings Group profi t before tax (excluding the fair value gain on investment properties) Group Profit ($ million) was $309.6 million. In 2007, a gain of $235.2 million from the restructuring of the Group’s interest in One Raffl es Quay to K-REIT Asia and a net fair value gain on investment properties 988.7 (less impairment losses) amounting to 779.7 $367.8 million, were recorded. Excluding these items, the pre-tax profi t for 2007 was $385.7 million, $76.1 million higher

314.0 than 2008’s. 263.4 200.3 227.7 139.9 184.6 155.7 Profit before 132.7 taxation but after fair value gain Profi t contributions from associated on investment companies were also lower in 2008. properties/ impairment The decrease in profi t contributions 2004 2005 2006 2007 2008 Attributable profit from trading properties were partly offset by higher income from the Group’s investment properties, higher fund management fees and lower interest costs. Proceeds from the restructuring of interest in One Raffl es Quay in December 2007 were used to repay borrowings, resulting in lower average borrowings for the whole year 2008 compared with 2007. Coupled with the drop in the Group’s blended cost of funds from 3.8% in 2007 to 2.5%, lower net interest costs were incurred in 2008.

Financial Review 57 Financial Review

The Group recorded a proﬁ t of Earnings and Dividends Per Share (cents) $8.5 million from the sale of 7.5 million shares in Singapore Computer Systems Limited and a gain of $10.7 million on the acquisition of additional interest in 108.3 Earnings after K-REIT Asia in the current year. taxation but before fair value gain on Fair value gain (before deferred tax 71.5 investment provision) on investment properties in properties/ 50.0 impairment the current year was $4.5 million. The 31.6 Earnings after corresponding fair value gain for 2007 27.0 33.3 taxation and fair 18.7 value gain on was $457.1 million. This was partly offset 31.1 investment by impairment loss of $89.3 million on 21.8 27.9 18.7 20.0 properties/ impairment the Group’s two hotels in Myanmar and 5.0 8.0 5.0 Total gross exchange loss pertaining to prior years’ dividend investments in Indonesia, hence a net 2004 2005 2006 2007 2008 per share gain of $367.8 million was recorded.

Group tax expense at $44.7 million was substantially lower than $151.8 million in Return on Shareholders’ Equity (%) 2007 on account of lower fair value gain on investment properties and pre-tax proﬁ t.

PATMI was $227.7 million, compared with 46.2 $779.7 million in 2007. PATMI for 2008 and 2007 were $213.3 million and 30.5 Return after $279.4 million respectively if fair value taxation but gain on investment properties and before fair value gain on impairment losses, the corporate 15.2 investment restructuring surplus and gain arising 11.7 9.9 properties/ 8.6 impairment from acquisition of additional interest in 12.8 9.5 9.7 Return after K-REIT Asia described above, were 8.6 taxation and fair value gain on excluded. On the same basis, earnings investment from overseas represented 29.5% of the properties/ 2004 2005 2006 2007 2008 impairment Group’s attributable proﬁ t compared with 39.7% for 2007.

Returns to Shareholders Dividend Payout Earnings per share for the year (before and after fair value gain on investment properties) were 31.1 cents and 31.6 cents, respectively. For 2007, earnings per share (before and after 262.9 fair value gain on investment properties less impairment losses) were 71.5 cents 50.0 and 108.3 cents respectively.

Proposed final dividend The Directors have recommended 86.5 ($ million) that a ﬁ nal dividend of 8 cents per share, 57.7 57.7 36.0 43.2 20.0 Distribution in 28.5 specie/proposed amounting to about $57.7 million, be special dividend paid to shareholders under a proposed 8.0 ($ million) 5.0 5.0 dividend reinvestment scheme. Total gross dividend per 2004 2005 2006 2007 2008 share (cents)

Keppel Land Limited 58 Report to Shareholders 2008 Total cash dividends amounting to $144.2 million comprising a fi nal dividend Sources of Finance ($ million) of 8 cents per share and a special dividend of 12 cents per share were paid in May 2008 in respect of 2007. 5,018.8 4,791.7 4,918.5 184.0 206.9 4,451.7 318.9 Financial Condition 3,987.1 439.7 325.9 1,937.8 At end-2008, shareholders’ equity 1,955.9 2,625.3 comprising share capital and reserves 2,111.1 1,828.8 454.4 increased by $151.3 million to 352.5 $2.44 billion. The increase was contributed Short-term 225.6 280.6 310.0 borrowings by the profi t for the year and increase 2,442.6 2,291.2 Long-term in foreign currency translation account 1,606.8 1,678.9 1,590.9 borrowings mainly as a result of the strengthening Minority of renminbi, partly offset by the payment interests of $144.2 million dividends in the year. Shareholders’ 2004 2005 2006 2007 2008 funds The share capital was increased by $3.1 million from the exercise of 1.1 million shares by certain full-time employees under the share option scheme. Assets Employed ($ million) Minority interests increased from $352.5 million to $454.4 million as at 5,018.8 end-2008 mainly due to share of profi ts, 4,791.7 4,918.5 and subscription by minority shareholders 4,451.7 3,987.1 1,403.0 of Evergro Properties Limited to its 1,595.4 1,759.5 Net current rights issue and injections of capital 1,450.9 assets and 1,359.3 813.8 deferred taxation by minority shareholders of certain 658.8 737.2 227.4 753.2 174.8 projects in Indonesia and Vietnam. 186.4 213.8 172.7 Non current 415.1 183.3 1,020.4 458.0 722.4 assets 659.4 Net debts of the Group at end-2008 were Properties 1,756.0 1,908.6 held for $1.5 billion compared with $1.1 billion a 1,404.9 1,526.7 1,606.8 development year ago, and debt-equity ratio increased Investments to 52% from 41%. The increase in net Fixed assets and investment borrowings was due mainly to the 2004 2005 2006 2007 2008 properties subscription of $244.2 million in the rights issue of K-REIT Asia and the payment of $144.2 million dividends to shareholders. Net Tangible Assets Per Share ($) Assets employed at end-2008 were $5 billion, compared with $4.9 billion at end-2007. Net tangible assets per share at end-2008 increased to $3.39 from 3.39 $3.18 at end-2007. 3.18

Property Trading 2.26 2.35 2.21 Sales from trading properties were $675.1 million compared with $1.2 billion in 2007. The decrease of $563.8 million was attributed mainly to the completion of The Waterfront and The Seasons in China, Villa Riviera in Vietnam, The Belvedere and Urbana in Singapore. Lower sales were also reported by Villa 2004 2005 2006 2007 2008 Riviera and Eight Park Avenue in China,

Financial Review 59 Financial Review

Analysis By Business Segment Pre-tax Attributable Assets Sales Ebita Proﬁ t Proﬁ t Employed

2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Property trading 675,124 1,238,951 175,402 303,233 229,099 380,781 160,018 274,938 3,030,627 2,786,037

Property investment 70,275 62,547 48,196 31,202 57,841 33,749 46,643 30,905 1,866,410 1,503,208

Fund management 36,493 30,034 21,539 17,278 25,606 17,453 21,127 14,138 92,839 82,547

Hotels and resorts, property services, and others 60,274 76,354 (5,694) (29,791) (13,701) (46,256) (14,507) (40,601) 28,876 546,675

Sub-total 842,166 1,407,886 239,443 321,922 298,845 385,727 213,281 279,380 5,018,752 4,918,467

Corporate restructuring surplus – – – – – 235,230 – 235,230 – –

Fair value gain on investment properties/impairment – – – – 4,467 367,779 3,670 265,040 – – Gain on acquisition of additional interest in an associated company – – – – 10,718 – 10,718 – – –

Total 842,166 1,407,886 239,443 321,922 314,030 988,736 227,669 779,650 5,018,752 4,918,467

Analysis By Geographical Location Pre-tax Attributable Assets Sales Ebita Proﬁ t Proﬁ t Employed

2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Singapore 504,965 742,296 169,893 160,802 219,682 219,802 150,361 168,583 3,082,835 3,341,029

Others 337,201 665,590 69,550 161,120 79,163 165,925 62,920 110,797 1,935,917 1,577,438

Sub-total 842,166 1,407,886 239,443 321,922 298,845 385,727 213,281 279,380 5,018,752 4,918,467

Corporate restructuring surplus – – – – – 235,230 – 235,230 – –

Total 842,166 1,407,886 239,443 321,922 314,030 988,736 227,669 779,650 5,018,752 4,918,467

Keppel Land Limited 60 Report to Shareholders 2008 Elita Promenade in India, and During the year, the Group subscribed Five-Year Financial Record The Tresor and Park Infi nia at Wee Nam $244.2 million in the rights issue of Profi ts showed consistent improvements in Singapore, whilst the remaining K-REIT Asia, and $80.5 million was from 2004 to 2007, with highest profi t units at The Linc, Pebble Bay, Freesia incurred in the construction of Ocean recorded in 2007. As a result, earnings Woods and The Elysia were fully sold Financial Centre. As a result, assets per share and return on shareholders’ by 3Q2007. employed in this segment increased equity for 2007 were the highest from $1.5 billion last year to $1.9 billion compared with the other four years. Profi t contributions from associated at end-2008. companies were lower than in 2007. FRS 40 became effective in 2007; and Included in 2007 was the share of Fund Management upon its adoption, fair value gain of the 20% initial profi t recognition for Management fee income increased from $457.1 million on the Group’s investment Refl ections at Keppel Bay and Marina $30 million to $36.5 million in 2008 due properties was taken to the pre-tax Bay Residences. to the strong performance by Alpha profi t for the fi rst time upon its adoption. Investment Partners Limited and higher The results were further boosted by the However, the lower earnings were fees earned by K-REIT Asia Management gain on the restructuring of One Raffl es partly mitigated by new profi t streams Limited from managing the enlarged Quay, partly offset by the impairment from The Estella in Vietnam and K-REIT Asia portfolio. Attributable charge mentioned earlier. Stamford City in Jiangyin, China, and profi t for this segment increased from Jakarta Garden City in Indonesia, and $14.1 million to $21.1 million in 2008. Profi ts in 2008 were lower than that the progressive profi t recognition from Assets employed increased from of 2007 mainly due to completion of The Sixth Avenue Residences and $82.5 million to $92.8 million as several projects and slower sales of The Suites at Central in Singapore. In at end-2008. existing projects because of the diffi cult addition, $9 million of dividend was market conditions. received from an investee company Hotels and Resorts, Property in Singapore. Services, and Others In line with the improved performance Sales for the year were $60.3 million since 2004, fi nal proposed dividends Attributable profi t achieved by this compared with $76.4 million in 2007, increased from 5 cents per share to segment for the year was $160 million, accounted for mainly by lower fees 8 cents per share in 2008. In 2006, $114.9 million less than $274.9 million earned by the marketing services arm a special distribution in specie of in 2007. and lower revenues from the Group’s 144.4 million units in K-REIT Asia, hotels in Myanmar, partly offset by higher representing 44 cents per share, was Assets employed increased from revenues from the Group’s Club Med made, bringing the total dividend for $2.8 billion to $3 billion, due mainly and Ria Bintan operations in Indonesia. the year to 50 cents per share. to development expenditures during the year. An attributable loss of $14.5 million In 2007, in view of the sterling was reported for this segment, an performance, a special cash dividend Property Investment improvement of $26.1 million from the of 12 cents per share and a fi nal Rental income for the current year was loss of $40.6 millionin 2007. Contributing dividend of 8 cents per share, $70.3 million compared with $62.5 million to the improved results were mainly a were proposed. last year. The increase of $7.8 million was profi t of $8.5 million from the disposal due to higher rental rates achieved for of Group’s interest in Singapore Net tangible assets per share increased Equity Plaza in Singapore and Saigon Computer Systems Limited and lower from $2.26 at end-2004 to $3.39 at Centre in Vietnam, partly offset by lower net interest cost of $10.8 million. During end-2008, with the exception of 2006, rental from Wisma BCA in Indonesia the year, the Group benefi tted from in which it registered a decrease due due to the lower occupancy rate. lower interest rates and lower net to the above-mentioned distribution borrowings following the utilisation of in specie. Share of profi t from K-REIT Asia was also the proceeds of $582.8 million from higher, partly offset by the cessation of the restructuring of ownership of profi t contribution from One Raffl es Quay One Raffl es Quay in December 2007 following the restructuring of its ownership to repay loans. in December 2007. Attributable profi t was further improved by release of accrual Following the loan repayments, assets of costs no longer required, resulting empoyed in this segment decreased in an increase of $15.7 million in the from $546.7 million at end-2007 to current year to $46.6 million. $28.9 million at end-2008.

Financial Review 61 Sensitivity Analysis

Investment Properties committed, an increase by the remaining Trading Properties The Group’s main investment properties percentage needed to achieve 100% The Group’s profi t from property trading are Ocean Towers, Equity Plaza, occupancy, a full year’s impact on is sensitive to actual sales achieved and One Raffl es Quay, Keppel Towers, pre-tax profi t derived from the Group’s the percentage of physical completion GE Tower, Bugis Junction Towers investment properties is approximately recognised during the year. and Prudential Tower in Singapore, $0.9 million. For every 1% decrease Saigon Centre and International in occupancy, a full year’s impact on Based on actual sales contracts signed Centre in Vietnam, and Wisma BCA in pre-tax profi t derived from the Group’s as at 31 December 2008, the incremental Indonesia. The pre-tax profi t from these investment properties is approximately impact on Group pre-tax profi t for every properties is sensitive to changes in $1.2 million, assuming that average 5% of physical completion is about their occupancies and the rental rates rental rate is maintained. $34.7 million. for lease renewals. In respect of committed leases and For projects which have been launched, Assuming that average rental rate is lease renewals, a full year’s impact on for every additional 1% of the total maintained, for every 1% increase in pre-tax profi t for every 10% change saleable area sold, the additional occupancy, or in the case of properties in average rental rates from new rates contribution to Group pre-tax profi t is an with total rentable area more than 99% negotiated is about $4.4 million. estimated $10.6 million. This is based on projected physical completion and sales, and the properties available for sale which the Group had as at end-2008.

Keppel Land Limited 62 Report to Shareholders 2008 Change In Group Pre-tax Profi t Borrowings 15% of the Group’s borrowings are on fi xed interest rates Resulting from: $ million and 85% on fl oating rates, for which interest rate hedges have not been entered into. If the average interest rate increase/ 1% or less increase in occupancies (see Note A) 0.9 decrease by 0.5%, with all other variables, including tax rate, 1% decrease in occupancies (see Note A) (1.2) being held constant, the Group’s profi t after tax will be lower/ 10% change in average rental rates (see Note B) 4.4 higher by $7.4 million per year.

Notes: (A) Assuming current average rentals are maintained. For properties with total rentable area more than 99% committed, the percentage increase would be that required to achieve 100% occupancy. (B) Based on committed leases due for renewal in 2009.

Incremental Impact of Additional Sales and Completion of Trading Properties on Group Pre-tax Proﬁ t

Resulting from: $ million

For every 5% of physical completion (see Note C) 34.7 For every 1% of additional sales (see Note D) 10.6

Notes: (C) Based on actual sales contracts signed as at 31 December 2008. (D) Based on physical completion and sales projected for the year, and the properties available for sale at end-2008.

Sensitivity Analysis 63 Property Portfolio Analysis

The Group’s diversiﬁ ed property Analysis Tenure (Singapore only) portfolio, comprising ofﬁ ce buildings, residential properties, hotels and $ million % resorts, serviced apartments, industrial Freehold 617 18.2 buildings, shophouses and retail outlets 999-year lease 647 19.1 are owned through subsidiary and associated companies. 99-year lease and others 2,126 62.7 3,390 100.0 The Group’s property portfolio amounted to about $4.9 billion. Details of the Group’s property portfolio are given on pages 210 to 226. The following analysis as at 31 December 2008 is for the Group’s effective interests only.

Singapore Properties A. Analysis by Tenure Freehold properties constituted 18.2% of the Group’s properties in Analysis by Development Stage (Singapore only) Singapore, with 999-year leases and 99-year leased properties making $ million % up 19.1% and 62.7% respectively. Completed 1,501 44.3 Under development 1,799 53.1 B. Analysis by Awaiting development 90 2.6 Development Stage 3,390 100.0 44.3% of the Group’s property portfolio in Singapore was made up of completed properties while 53.1% was under development. Properties under development included Ocean Financial Centre, Marina Bay Financial Centre, The Sixth Avenue Residences, The Suites at Central, Marina Bay Residences and Reﬂ ections at Keppel Bay. The remaining 2.6% of the Group’s properties was Analysis by Sector (Singapore only) landbank awaiting development.

$ million % Office 2,336 68.9 Residential 990 29.2 Industrial 51 1.5 Retail 13 0.4 3,390 100.0

Keppel Land Limited 64 Report to Shareholders 2008 C. Analysis by Sector 68.9% of the Group’s property Analysis by Estimated Gross Floor Area (Singapore only) portfolio in Singapore was ofﬁ ce buildings, which included sm’000 % Ocean Financial Centre, Office 304 60.0 Ocean Towers, Marina Bay Residential 174 34.3 Financial Centre, Equity Plaza, Industrial 27 5.3 Prudential Tower, Keppel Towers, Retail 2 0.4 GE Tower, Bugis Junction Towers, 507 100.0 One Rafﬂ es Quay and Keppel Bay Towers. Residential properties made up 29.2% while the remaining portfolio comprised retail and industrial components in the proportions of 0.4% and 1.5% respectively.

D. Analysis by Estimated Gross Building Floor Area The total gross building ﬂ oor area Analysis by Location – Completed Projects of the Group’s property portfolio in Singapore was 507,000 square metres. Ofﬁ ce buildings and $ million % residential properties formed 60% Local 1,501 77.0 and 34.3% respectively of the Overseas 449 23.0 total building area. The balance 1,950 100.0 comprised 0.4% for retail and 5.3% for industrial buildings.

Overseas Properties 23% of the Group’s completed properties were located overseas. Taking into account projects under development, overseas properties constituted 30.2% of the Group’s property portfolio.

Analysis by Location – All Projects

$ million % Local 3,390 69.8 Overseas 1,464 30.2 4,854 100.0

Property Portfolio Analysis 65 Value Added Statement

By Segment Hotels and resorts, Property Property Fund property services, trading investment management and others Group

$ million $ million $ million $ million $ million

Total value added 2008 287.5 76.1 36.6 53.5 453.7 2007 434.3 311.6 24.9 26.1 796.9

Distributed as follows: Employees in salaries and staff beneﬁ ts 2008 15.7 5.1 10.9 53.3 85.0 2007 11.5 4.5 7.3 63.8 87.1 Governments in taxation 2008 31.8 3.1 4.5 4.2 43.6 2007 77.8 0.2 3.3 1.7 83.0 Providers of capital in dividends and interest 2008 38.7 14.5 – 142.6 195.8 2007 41.4 35.7 – 49.2 126.3 Retained for reinvestment and asset replacements 2008 201.3 53.4 21.2 (146.6) 129.3 2007 303.6 271.2 14.3 (88.6) 500.5 Total distribution 2008 287.5 76.1 36.6 53.5 453.7 2007 434.3 311.6 24.9 26.1 796.9

Total Value Added by Segment ($ million)

796.9

87.1

83.0

126.3

453.7 434.3 85.0 11.5 77.8 311.6 43.6 4.5 287.5 41.4 0.2 15.7 35.7 500.5 31.8 195.8 38.7 53.5 53.3 303.6 76.1 271.2 4.2 26.1 201.3 5.1 3.1 36.6 24.9 63.8 129.3 10.9 7.3 142.6 14.5 4.5 1.7 53.4 3.3 49.2 Employees 21.2 14.3 Governments (88.6) (146.6) Providers of capital

2008 2007 Retained/ Hotel and Hotel and reinvested 2008 2007 2008 2007 2008 2007 resorts, resorts, 2008 2007 Property Property Property Property Fund Fund property property in group’s Group Group trading trading investment investment management management services, services, business and others and others

Keppel Land Limited 66 Report to Shareholders 2008 Value Added Statement 2004 2005 2006 2007 2008 $ million $ million $ million $ million $ million Our sales of goods and services to non-Group customers totalled 476.2 586.4 948.0 1,407.9 842.2 Whereas our purchase of raw materials, supplies and services from non-Group sources amounted to (311.9) (337.5) (672.3) (998.9) (517.7) and corporate restructuring surplus/enbloc property sales/gain on acquisition of additional interest in an associated company were – – 85.4 235.2 10.7 so that the value added from operations was 164.3 248.9 361.1 644.2 335.2

In addition: our share of proﬁ ts earned by associated companies was 36.4 28.2 27.6 93.9 68.1 income from our investment was 16.5 34.0 56.7 58.8 50.4 Total value added 217.2 311.1 445.4 796.9 453.7

Excluding investment income, total value added for the Group was distributed as follows: to employees in salaries and staff beneﬁ ts 39.9 47.1 60.5 87.1 85.0 to governments in taxation 2.9 35.6 46.2 83.0 43.6 to providers of capital in: interest paid on borrowings 24.0 25.4 70.4 79.2 51.4 dividends to minority shareholders in subsidiary companies 14.3 12.8 6.6 3.9 0.2 dividends to shareholders of the Company 22.7 28.5 36.0 43.2 144.2 distribution in species to shareholders of the Company – – 262.9 – – 61.0 66.7 375.9 126.3 195.8

The balance was reinvested in or ploughed back from business in: depreciation 13.4 17.3 11.2 9.7 7.7 minorities’ share of subsidiary companies’ profi ts retained or previous years’ profi ts ploughed back by subsidiary companies (10.0) (19.4) 10.9 19.4 41.8 profi ts for the year retained or previous years’ profi ts ploughed back by the Company 93.5 129.8 (116.0) 412.6 29.4 96.9 127.7 (93.9) 441.7 78.9 200.7 277.1 388.7 738.1 403.3 And non-operating investment income was: 16.5 34.0 56.7 58.8 50.4 217.2 311.1 445.4 796.9 453.7

In the calculation of value added, the fair value gain on investment properties/impairment and related taxation are excluded.

Value Added Statement 67 Productivity Analysis

The total value added by the employees in salaries and staff beneﬁ ts Group (including investment income of $85 million, governments in taxation of $50.4 million) in 2008 was of $43.6 million and providers of capital $453.7 million. Contributions from in interest and dividends totaling the various business segments are $195.8 million. The balance of as follows: $78.9 million was reinvested in business.

$ million In the previous year, the total value Property trading 287.5 added by the Group was $796.9 million. Property investment 76.1 Fund management 36.6 The Group’s value added from operations Hotels and resorts, property for the previous year was $738.1 million. services, and others 53.5 Salaries and staff beneﬁ ts of employees 453.7 absorbed $87.1 million, tax to governments $83 million, and interest and dividends Excluding investment income, the to capital providers $126.3 million, Group’s value added from operations leaving the balance of $441.7 million of $403.3 million was absorbed by reinvested in business.

Value Added (Excluding Investment Income) ($ million)

738.1

87.1

83.0

388.7 126.3

60.5 403.3 46.2 85.0 277.1 43.6 200.7 47.1 35.6 441.7 39.9 375.9 195.8 2.9 66.7 61.0 Wages, salaries and 127.7 benefits 96.9 78.9 Taxation (93.9) Interest expense and dividends Depreciation and profit retained/ 2004 2005 2006 2007 2008 reinvested

Keppel Land Limited 68 Report to Shareholders 2008 Value Added Per Employee ($’000)

230.6

141.6 119.5 120.5 83.2

2004 2005 2006 2007 2008

Value Added Per Dollar Employment Cost ($)

7.40

5.97 5.28

4.12 3.94

2004 2005 2006 2007 2008

Productivity Data (Excluding Associated Companies) 2004 2005 2006 2007 2008

Sales per employee: excluding associated companies ($’000) 241.1 281.5 371.8 504.1 302.7

Value added per employee ($’000) 83.2 119.5 141.6 230.6 120.5

Value added per dollar employment cost ($) 4.12 5.28 5.97 7.40 3.94

Productivity Analysis 69 Economic Value Added

Economic Value Added (“EVA”) improved over the ﬁ ve years, from a negative Economic Value Added ($ million) $86.6 million in 2004 to a positive $45 million in 2008. The highest EVA was achieved in 2007 at a positive $222.2 million, contributed 222.2 by the strong performance in trading properties in Singapore and overseas, and a gain of $235.2 million on the 45.0 restructuring of the ownership of One Rafﬂ es Quay. (7.1)

(86.6) (76.4) The capital charge for 2008 was $54.1 million less than the previous year due to the decrease in average capital employed from $4.8 billion to 2004 2005 2006 2007 2008 $4.2 billion as a result of the repayment of loans from the proceeds from the restructuring of ownership of One Raffl es Quay. In addition, the weighted average cost of capital in 2008 2008 2007 $ million $ million was 6.9%, down from 7.1% in 2007, in line with the drop in interest rates. Profi t after tax before fair value gain on investment properties 266.0 448.7 Despite the lower capital charge, Adjustment for: EVA in 2008 was signifi cantly lower Interest expense 51.4 79.2 than 2007 as lower operating profi ts Interest capitalised - non taxable 25.6 47.1 were reported following completion of Tax effect on interest expense adjustments (9.3) (14.3) several projects and lower contribution Provisions, deferred tax, amortisation and from associated companies. other adjustments (0.7) 3.6 Net Operating Profi t After Tax 333.0 564.3 Average capital employed (Note 1) 4,180.6 4,833.3 Weighted average cost of capital (Note 2) 6.89% 7.08% Capital Charge 288.0 342.1 Economic Value Added 45.0 222.2

Note: 1. Average capital employed was derived from the quarterly averages of net assets plus interest-bearing liabilities and deferred tax. 2. Weighted average cost of capital is calculated in accordance with the Group EVA Policy as follows: (a) cost of equity using Capital Asset Pricing Model with market risk premium of 6% (2007: 6%) per annum; (b) risk free rate of 2.780% (2007: 3.041%) based on yield-to-maturity of Singapore government 10-year bonds; (c) unlevered beta of 0.75 (2007: 0.75); and (d) pre-tax cost of debt at 3.53% (2007: 3.77%) using 5-year Singapore dollar swap offer rate plus 50 basis points (2007: 45 basis points).

Keppel Land Limited 70 Report to Shareholders 2008 Corporate Liquidity and Capital Resources

The Group’s cash position as at end-2008 was reduced to about $626.4 million compared with $1.2 billion a year ago Credit Facilities ($ billion) on account of loans repaid in 2008. Against a backdrop of increases in funding for its investments, the Group’s net borrowings went up to $1.5 billion as at end-2008. As a result, the debt-equity ratio increased to 52% from 41% previously. 4.1

3.4 Total loans outstanding as at year-end amounted to $2.1 billion, representing 48% of the total available facilities of $4.4 billion. Out of the total loans of $2.1 billion outstanding, only 16.4%, 1.8 1.9 amounting to about $348.3 million, was secured by certain subsidiary companies which pledged their assets (with a net book value of about $1,564.2 million) to the lending institutions 0.3 0.3 0.4 0.4 Floating rate and by a standby letter of credit from a bank. borrowings

Available Utilised The maturity proﬁ le of the loans is as follows: Available Utilised Fixed rate 2008 2008 2007 2007 borrowings Due in 2009 $ 184 million Due in 2010 (ﬁ nancial institutions) $ 712 million Due in 2010 (related company) $ 820 million Due in 2011 to 2013 $ 406 million Interest Cover

As the Group operates primarily in Singapore, China, Vietnam, Indonesia and India, it is exposed to currency risks. The Group will, as far as practicable, borrow in the same functional 11.1 currencies of its overseas operations to achieve a natural 642.2 hedge. The loans are denominated in the following currencies: 8.6 Net interest expense Singapore dollar $1,767 million 319.9 (including United States dollar $ 263 million amounts capitalised) Renminbi $ 30 million ($ million) Indonesian rupiah $ 18 million 74.5 28.7 Profit Hong Kong dollar $ 17 million ($ million) Vietnamese dong $ 14 million Thai baht $ 12 million Interest cover Indian rupee $ 1 million 2008 2007 (times)

In 2008, net interest expense charged to the proﬁ t and loss account amounted to $10.4 million and $18.3 million was capitalised under development properties and Debt-Equity Ratio investment properties.

Fixed and ﬂ oating interest rate loans at end-2008 were in the proportion of 15% and 85% respectively. As interest rates 2,897 52% moved down during the year, the average net cost of funds 2,644 in 2007 was 2.5%, lower than 3.82% in 2007. Interest cover 41% was 11.1 times compared with 8.6 times in 2007. Net debt 1,495 ($ million) 1,087 Equity (including minority interests) ($ million)

Debt- equity 2008 2007 ratio (%)

Corporate Liquidity and Capital Resources 71 Corporate Liquidity and Capital Resources

Gearing Structure Fixed Rate Floating Rate Total Borrowings Borrowings $’000 % $’000 % $’000 % Facilities available for drawdown 325,149 100 4,088,563 100 4,413,712 100 Amount utilised 309,200 95 1,812,618 44 2,121,818 48 Balance unutilised 15,949 5 2,275,945 56 2,291,894 52

Cash and cash equivalents 626,361 2,918,255

2008 2007 Interest cover

Proﬁ t before interest, fair value gain on investment properties/impairment and taxation ($’000) 319,942 642,173 Net interest cost expensed and capitalised ($’000) 28,711 74,541 Interest cover (times) 11.1 8.6

Weighted average net cost of borrowings 2.50% 3.82%

Secured borrowings ratio Total secured borrowings ($’000) 348,253 296,710 Percentage of total borrowings 16.4 13.0

Debt-equity ratio Total borrowings: Gross ($’000) 2,121,818 2,274,776 Net of cash ($’000) 1,495,457 1,087,471

Total equity (excluding minority interests) ($’000) 2,442,560 2,291,231

Debt-equity ratio (excluding minority interests): Gross borrowings (%) 87 99 Net of cash (%) 61 47

Total equity (including minority interests) ($’000) 2,896,934 2,643,691

Net debt-equity ratio (including minority interests) (%) 52 41

Keppel Land Limited 72 Report to Shareholders 2008 Risk Management

Weathering the Global The ERM plans are reviewed at least Operational Readiness with Economic Crisis with annually to refl ect the changes of key Business Continuity and Sound Risk Management risks that the operations are facing Crisis Management The global fi nancial and economic crisis and the progress of mitigating actions. In addition to the existing pandemic has accentuated the importance of a These key risks, mitigating actions and fl u and IT disaster recovery plans, good enterprise risk management (ERM) key risk indicators are monitored by the Group is currently reviewing framework. Over the years, Keppel Land the ERM Committee, which comprises and developing a Company-wide has established strong foundations in its all heads of department, to ensure its business continuity plan which will ERM processes, which put the Group relevance and effectiveness. include overseas offi ces to enhance in good stead to meet the challenges operational readiness of critical brought on by the global economic crisis. The ERM Committee supports the business functions in times of crisis. Board Risk Committee to ensure that In early 2008, prior to the escalation systematic risk management processes Meanwhile, the procedures for reporting of the global fi nancial crisis, the Group are applied consistently throughout accidents and major incidents have had undertaken a pre-emptive exercise the Group. The Board Risk Committee been enhanced in 2008. With these where several key scenarios are set for monitors the Group’s capital allocation, procedures, management will be better stress testing to quantify the potential country concentration exposures and informed in a timely manner to respond impact on the Group’s earnings and signifi cant projects, and reviews to signifi cant incidents occurring in any cash fl ows. The exercise provides the key risks with management of its operating units. This also forms management with an indication of the on a quarterly basis. a basis for crisis communications, potential fi nancial impact on the Group enabling the Group to better manage and enables early strategic decision- In building a strong risk-centric culture, the media, investment community and making to be taken in response to the ERM framework and processes are general public. a worsening business environment introduced to all new employees as part arising from the global fi nancial and of their orientation programme. This is in Future Initiatives economic crisis. addition to the updates on ERM held Given the dynamic environment, business through events such as the Annual continuity and crisis management will be An Integrated Approach to ERM International Conference and International pertinent to ensure business resilience. Keppel Land’s ERM processes, which Exchange, where the Company has the encompass operational, fi nancial and opportunity to reach out to its overseas With its diverse operations across Asia, reputational aspects are regularly staff and postees. The Group advocates Keppel Land aims to improve its business assessed and managed across business striking an optimal balance between risks continuity and crisis management plans units. As part of the ongoing ERM efforts, and returns through taking calculated for its overseas operations. ERM plans for each business unit within the Group risks and embracing risk ownership. overseas operations will also be reviewed has drawn up an ERM plan where risks and enhanced to address the risks in the pertaining to the business unit are During the year, the Company’s ERM fast-evolving business environment. identifi ed. The degree of impact of the team assisted Evergro Properties, a risk is assessed and prioritised according listed subsidiary of Keppel Land, to Keppel Land will also seek to to the likelihood of occurrence and impact implement ERM processes as part of its continually benchmark against on the business unit. Proactive actions ERM roll-out plan where a standardised best risk management practices are then developed to mitigate the critical risk management methodology and tools and strengthen its ERM process and signifi cant risks. Key risk indicators, are applied consistently throughout the and capabilities to meet the which act as early warning signals, Group to facilitate common understanding Group’s objectives. are closely monitored and reported and management of pertinent risks. by the risk owners as part of regular management reporting.

Risk Management 73 Risk Management

Managing Enterprise Risks In 2008, the Group’s key enterprise risks and appropriate mitigating measures taken in 2008 are summarised below:

1. Human Resources Risks 4. Financial Risks 8. Information Risks • The Company continues to • The Company uses various • The Company is reviewing its ensure its compensation and fi nancial instruments where current information system to benefi ts package is competitive practically possible, to hedge improve the management and to attract and retain talents. against foreign exchange and reporting of business information. • Programmes are planned to interest rate risks. • The Company is exploring improve employees’ engagement • The Company actively manages its ways to enable easier access and increase their sense cash fl ows and maintains adequate to information resources for its of belonging. funding resources for its operations. business units. • Talent management and training programmes for different levels 5. Product Development and 9. Capital Allocation Risks of staff are being reviewed Customer Wants Risks • The Company continues to to improve employees’ • The Company strives to enhance update its capital allocation policy competencies. its market presence by introducing to ensure accuracy in treatment innovations in new developments of exposures and relevance to the 2. Regulatory and Political Risks to anticipate market demand. needs of the business. • The Company continues This is achieved though • The Company monitors exposure to establish close working comprehensive market studies and in each country on a regular relationships with local business close working relationships with basis and ensures all project partners and authorities where relevant consultants. investments are in compliance it operates so as to anticipate with their capital allocation policy. possible changes in government 6. Business Interruption and policies and regulations. Catastrophic Loss Risks 10.Health, Safety and • The Company will continuously • Current business continuity plans Environmental Risks keep abreast of political are being reviewed and tested to • The Company actively promotes conditions and monitor local improve their effectiveness. safety practices at the workplace situations closely. • To ensure resilience of its IT and acts promptly to remedy infrastructure, the Company will shortcomings identifi ed. 3. Real Estate Market Risks be engaging an external party to • The Company has implemented • The Company actively engages conduct an IT security audit. an environmental management business partners, local system in conformance to authorities and senior country 7. Investment Evaluation Risks ISO 14001 for its property managers to share market and • The Company continues to ensure development activities. competitive insights. up-to-date information is available • The Company is committed to • Appropriate economic and when evaluating potential investments. ensure its development projects property market indicators are • The Company has incorporated meet local green building monitored regularly to assist the risk assessment as part of its requirements. Company in decision-making. investment evaluation process.

Keppel Land Limited 74 Report to Shareholders 2008 Business Dynamics and Risk Factors

The Group’s strategy for enhancing development so that economies of The Group also faces possible challenges shareholder value focuses on developing scale can be achieved to provide good such as political uncertainty issues. properties for sale and managing property quality and affordable urban housing; funds. Besides the Singapore property The Group’s property fund management market, the Group is in the property • Effective partnerships with contractors, business will develop further for recurring markets of China, Vietnam, Indonesia, suppliers and joint-venture partners income. Efforts are being made to identify India and the Middle East where there so that projects can be delivered on and invest in projects that will give the is still a shortage of good quality time and with quality; expected rates of return required housing to satisfy the needs of their by investors. growing middle-class populations. • Favourable lending laws and interest rates for property developers and For both its Singapore and overseas Regionally, the success of the Group’s end-purchaser ﬁ nancing; markets, the Group is facing economic efforts will be dependent, inter alia, on slowdown due to the effects of the the following factors: • Favourable tax laws and double present global recession. taxation treaties with Singapore, and • Availability of residential sites at ease of repatriating funds to Singapore; The Company will continue to monitor competitive prices for housing and all major risks affecting the Group and also good sites at competitive prices • Proper management of interest and take the necessary actions to mitigate in populous cities for township currency rate exposures. or eliminate them.

Effective and long-term partnerships with contractors, suppliers and joint venture partners who share the values of safety and quality enhance Keppel Land’s capabilities to deliver projects with excellence.

Business Dynamics and Risk Factors 75 Critical Accounting Policies and Recommended Accounting Practice

As required by the Companies Act, Business Combinations the Group’s and Company’s fi nancial Under the relevant reporting standard, statements have been prepared in assets and liabilities of subsidiary accordance with Singapore Financial companies which the Group acquired Reporting Standards (“FRS”). The during the year were stated at their fair following are the critical accounting values at the dates of acquisition. policies: Investment Properties Revenue and Profi t Recognition Investment properties are initially Revenue and profi t on partly completed recognised at cost and subsequently projects which are held for sale are measured at fair value, determined recognised using the percentage of annually by Directors based on completion method. For Singapore valuations by independent professional trading properties under development, valuers. Following the adoption of the profi t recognition upon the signing FRS 40, changes in fair values of of sales contracts and payment of investment properties less provision for the fi rst instalment is 20% of the total deferred tax are recognised in the profi t estimated profi t attributable to the and loss account in the year in which actual contracts signed. Subsequent they arise. recognition of profi t is based on the stage of physical completion. For Leasehold Properties overseas trading properties under Leasehold properties (except for those development, the profi t recognition with unexpired tenures of over 20 years) upon the signing of sales contracts is are depreciated evenly over the period the direct proportion of total expected of the lease. Leasehold properties with project profi t attributable to the actual unexpired tenures of more than 20 years sales contracts signed, but only to the are treated as investment properties extent that is related to the stage of and are accounted for in accordance physical completion. with FRS 40.

The more conservative percentage Future Changes in Accounting of completion method for overseas Policies trading properties is appropriate as The Group has not adopted the markets there are less matured and following FRS and Interpretations that risks are greater. In respect of large have been issued and relevant to the trading projects both in Singapore and Group but not yet effective: overseas, the percentage of completion method is applied on a phase-by- phase basis (i.e. one phase for every part of a project with one temporary occupation permit).

Keppel Land Limited 76 Report to Shareholders 2008 FRS 1 (Presentation of the interpretation is to be applied Financial Statements – retrospectively. It clarifi es when and Revised Presentation) how revenue and related expenses from The revised FRS 1 requires owner and the sale of a real estate unit should be non-owner changes in equity to be recognised if an agreement between presented separately. The statement a developer and a buyer is reached of changes in equity will include only before construction of the real estate is details of transactions with owners, completed. Furthermore, the interpretation with all non-owner changes in equity provides guidance on how to determine presented as a single item. In addition, whether an agreement is within the scope the revised standard introduces the of FRS 11 (Construction Contract) or statement of comprehensive income: FRS 18 (Revenue). it presents all items of income and expense recognised in profi t or loss, RAP 11 Pre-Completion together with all other items of recognised Contracts for the Sale of income and expense, either in one single Development Property statement, or in two linked statements. RAP 11 is still applicable in Singapore as IFRIC Interpretation 15 has not been FRS 108 (Operating Segments) adopted by the Accounting Standards FRS 108 supersedes FRS 14 (Segment Council. It was issued by the Institute Reporting) and requires the Group to of Certifi ed Public Accountants of report the fi nancial performance of its Singapore in October 2005. operating segments based on the information used internally by In the RAP, it is mentioned that a Management for evaluating segment property developer’s sales and purchase performance and deciding on allocation agreement is not a construction contract of resources. Such information may be as defi ned in FRS 11 (Construction different from the information included Contract) and the percentage of in the fi nancial statements, and the basis completion (“POC”) method of of its preparation and reconciliation to recognising revenue, which is allowed the amounts recognised in the fi nancial under FRS 11 for construction contract, statements shall be disclosed. may not be applicable for property developers. The relevant standard The Group will apply FRS 108 from for revenue recognition by property 1 January 2009 and provide comparative developers is FRS 18 (Revenue), information that conforms to the which addresses revenue recognition requirements of FRS 108. Adoption of generally for all types of entities. this standard will have no impact on However, there is no clear conclusion the fi nancial position and results of the in FRS 18 whether the POC method Group when implemented in 2009. or the completion of construction (“COC”) method is more appropriate International Financial for property developers. Reporting Interpretations Committee(“IFRIC”) As stated above, the Group recognises Interpretation and Recommended revenue and profi t on partly completed Accounting Practice projects for sale based on the POC The International Accounting Standards method. The impact on the Group Board issued IFRIC Interpretation 15 in results had the COC method been July 2008, which becomes effective for adopted, is disclosed in Note 36 to the fi nancial years beginning on or after Financial Statements. 1 January 2009. When adopted,

Critical Accounting Policies and Recommended Accounting Practice 77 Signiﬁ cant Events

(1)

January February May • Extending its green efforts, • Keppel Land unveiled concept plans • Ocean Financial Centre was Keppel Land formed an for future phases of Saigon Centre to the fi rst offi ce development in Environment Management a distinguished group of Singapore Singapore’s central business Committee, responsible for and Vietnam delegates led by His district to achieve the Platinum developing and implementing Excellency S R Nathan, President Green Mark Award by the Building environmental programmes. of the Republic of Singapore, and and Construction Authority (BCA) Vietnam’s Deputy Prime Minister while Marina Bay Financial Centre • Keppel Bay Bridge was named Hoang Trung Hai. (Phase One, Commercial) and and opened by His Excellency S R Refl ections at Keppel Bay both Nathan, President of the Republic March won Gold Awards. of Singapore(1). • Keppel Land obtained the investment certifi cate for Riviera Point, a 2,400-unit • Alongside the launch of the Keppel • Construction for Refl ections at waterfront residential development in Group’s ‘Safety Starts with Me’ Keppel Bay commenced following District 7 of HCMC, Vietnam. initiative, Keppel Land stepped up its groundbreaking ceremony. its efforts in safety promotion with April the Workplace Safety and Health • Marina at Keppel Bay had a grand • Leveraging its extensive experience Campaign 2008 held at Refl ections opening by Senior Minister Goh in developing world-class waterfront at Keppel Bay worksite. Chok Tong, as the 10-strong precincts, Keppel Land announced its international Clipper fl eet sailed fi rst integrated residential-cum-marina June into Keppel Bay. lifestyle development in Zhongshan, • Keppel Land acquired another Guangdong Province, China(2). 10-ha site in Shenyang’s Shenbei • Keppel Land and Bellingham New District, which when combined Marina Industries entered into a • K-REIT Asia’s rights issue was with the adjacent 24-ha site acquired strategic partnership to develop successfully closed, raising gross earlier in August 2007, will house premier marinas internationally. proceeds of $551.7 million to partly an integrated township development. refi nance a bridging loan, which had • Keppel Land posted record results been used for the purpose of K-REIT • Sedona Hotels International called for FY2007, with a net profi t of Asia’s acquisition of a one-third for a triple celebration as Hotel $779.7 million. interest in One Raffl es Quay. Sedona Manado was awarded

Keppel Land Limited 78 Report to Shareholders 2008 (2)

Indonesia’s Leading Resort while September in recognition of its contributions Sedona Hotel Yangon and Sedona • Marina Bay Financial Centre towards the Singapore Countdown Hotel Mandalay were nominated announced additions to its stellar 2007 at Marina Bay. ‘Myanmar’s Leading Hotel’ at the line-up of pre-committed tenants, World Travel Awards 2008. bringing overall pre-commitment November to 61%. • Launched at Marina at Keppel Bay, • Keppel Bay became the fi rst Keppel Bay Sailing Academy is the waterfront development in Singapore • For its socio-economic contributions fi rst in Singapore to provide courses to provide luxury yacht charter to Vietnam between 2003 and 2007, accredited by the internationally services to home owners, as it Saigon Centre received the Medal of recognised and UK-based Royal unveiled a spanking new yacht Labour Award from the President of Yachting Association. which was christened The Admiral. the Socialist Republic of Vietnam. December July • Keppel Land achieved the ISO 14001 • Continuing to set benchmarks • Alpha Investment Partners Environmental Management System internationally, Keppel Land’s announced the successful closing certifi cation for the development properties in Vietnam, Sedona of its Alpha Asia Macro Trends Fund, of commercial and residential Suites HCMC and Villa Riviera, which raised a total of US$1.2 billion properties in Singapore. bagged the prestigious Golden ($1.7 billion), exceeding its original Dragon Award in the real estate target of US$1 billion. October services and construction • Excellence in corporate governance categories respectively while August won several awards for Keppel Land, Saigon Centre was named the • Evergro Properties’ rights issue was including 11 awards at the Euromoney Most Energy Effi cient Building successfully closed, raising gross Liquid Real Estate Awards 2008, (First Runner-Up). proceeds of $137.1 million which which recognises the best in the will enable it to take advantage of global real estate industry. • Keppel Bay Sailing Academy opportunities to acquire land for announced an agreement with property development, and to improve • Marina Bay Financial Centre was Clipper Ventures to provide its existing developments in China. conferred the Associate of the Arts Clipper training in Asia. Award by the National Arts Council

Signiﬁ cant Events 79 Operations and Market Review Asian Resilience

Regional governments are implementing stimulus packages to boost domestic economies. China appears to be one of the most resilient in Asia, supported by favourable policies and continued demand for middle-income housing.

Amid the global fi nancial turbulence, Singapore • Allow 40% property tax rebate for Asia has quickly braced itself for the commercial properties for 2009. storm as governments across the region Policies • Defer property tax for land approved have responded in quick succession $20.5-billion Resilience Package for development for up to two years. with economic stimulus packages and • Provide jobs for Singaporeans • Allow one-year extension of positive property measures to prop up ($5.1 billion), stimulate bank lending project completion period for the market. ($5.8 billion), enhance business residential projects undertaken cash fl ow and competitiveness by foreign developers. With these concerted efforts, coupled ($2.6 billion), support families • Allow re-assignment of government with the signifi cant Asian growth ($2.6 billion) and build a home for sale sites and private residential land momentum in recent years, it is hoped the future ($4.4 billion). owned by foreign developers. that Asia will stage a speedy recovery. • Extend the period for foreign Property Market Measures developers to dispose of all China will continue to be the growth • Suspend Confi rmed List under residential units in the development engine of Asia. It is believed to be Government Land Sales Programme from two to four years, and allow one of the most resilient among Asian (GLS) for fi rst half of 2009. them to rent out unsold residential economies, supported by positive • Lift ban on conversion of offi ce units for up to four years to mitigate government policies and continued space in the central business district holding costs. demand for middle-income housing. to other uses. Impact • Resilience Package will help save jobs, reduce business costs and ease corporate cash fl ows. • Measures will enhance developers’ fl exibility in phasing out project completions and launches, ease cash fl ows and holding costs, as well as provide foreign developers with a fl exible exit strategy. • The passing on of property tax rebate will lower tenants’ occupation costs and help sustain offi ce demand in the economic downturn. • Suspension of Confi rmed List under GLS will keep potential supply in check.

Keppel Land Limited 80 Report to Shareholders 2008 China 30-point Directives Impact • Boost total lending by fi nancial • Massive stimulus package will Policies institutions to RMB 4 trillion. boost confi dence in the economy. RMB 4-trillion Stimulus Package: • Lower reserve requirement ratio • VAT reform will reduce business • Focus on 10 key areas. for lenders by 0.5% to 13.5%. operation costs and improve • Value-added tax (VAT) reform to • Relax lending restrictions and profi tability for developers. cut costs for Chinese companies standards, and possibility of further • Looser credit controls and lower by RMB 120 billion. relaxation after a full review of costs of fi nancing will benefi t current policies and standards developers. Property Stimulus on lending. • Cut in interest rates and lower • Mortgage Measures • Reduce prime lending rate to downpayment will enhance housing – Mortgage rate for fi rst-time 5.31% in December 2008 affordability for homebuyers. homebuyers and upgraders from 7.47% a year ago. • Tax incentives will encourage more lowered to 70% of benchmark • Expand channels of fi nancing and residential sales transactions. lending rate. promote real estate investment trust • Local governments are allowed – Downpayment for fi rst-time (REIT) listings in China. to introduce own incentives or homebuyers and upgraders of concessions to support their ordinary housing lowered to property markets and to facilitate an 20% from 30%. early recovery in housing demand. – Same preferential terms as fi rst-time homebuyers given to second-time homebuyers. – Loan interest rate of individual housing provident fund adjusted to 3.87% from 4.05%.

• Tax Incentives – Deed tax cut to 1% from 1.5% for ﬁ rst-time homebuyers of units less than 90 square metres. – Waiver of land appreciation tax for individual home sales. – Business tax only levied on transactions of property bought less than two years. – Tax levied on capital gain rather than transaction value. – Reduce business tax on secondary housing transactions. – Abolish the 0.5% stamp duty.

Operations and Market Review Asian Resilience 81 Operations and Market Review Asian Resilience

Fundamentals for Vietnam, India and Indonesia are expected to remain positive in the mid- to long-term. Favourable demographics such as a young population, growing middle-class, urbanisation, rising disposable income and home-ownership aspirations will continue to drive sustainable demand for quality housing in these markets.

Looking ahead, the environment in Asia is expected to improve with more attractive property prices, lower mortgage rates and improved affordability.

Vietnam

Policies Monetary Measures • State Bank of Vietnam (SBV) cut prime lending rate to 7% in February 2009, bringing cumulative cuts in rate since October 2008 to six times or 700 basis points. Lending rate in February 2009 stands at 10.5%. • SBV further devalued the Dong to Dong16,989 : US$1 from Dong16,494 : US$1 to support exports, narrow trade deﬁ cit and stabilise the balance of payments. The Dong’s trading band was also widened from 2% to 3% in November 2008.

US$6-billion Stimulus Package • Allocate US$1 billion from foreign reserves to fi nance major, high-priority development projects such as infrastructure, agricultural development, Impact social housing, and small and • Stimulus package is aimed at medium enterprises (SMEs). overcoming economic diffi culties, to • Channel US$1 billion to ongoing achieve target 6.5% GDP growth in • Although foreign direct investment investment projects in HCMC. 2009 and ensure social security. infl ows will slow dramatically in • Provide interest rate subsidy of 4% • Government’s budget defi cit is 2009-10, Vietnam’s long-term for 12-month loans for large-scale expected to widen in 2009 as prospects remain sound. transport, infrastructure projects and it pushes through a large fi scal Vietnam’s membership of the housing development programmes. stimulus package, coupled with World Trade Organisation will • Tax incentives include deferment of relatively slow revenue growth in the also help to improve the business corporate and personal income tax face of the economic slowdown. operating environment. and tax cuts for SMEs and reduction SBV is also likely to continue to in VAT. loosen monetary policy.

Keppel Land Limited 82 Report to Shareholders 2008 India

Policies Monetary Measures • Repo rate and cash reserve ratio (CRR) were cut several times since July/August 2008 to 5% in March 2009.

Fiscal Stimulus Measures • Measures include additional planned expenditure of up to Rs 200 billion (US$4 billion) in fi scal 2008/2009, 4% cut in VAT on all products other than petroleum products, refi nancing of bank lending for infrastructure projects, support for housing sector, liberalisation of policy on overseas borrowing and further enhancement of credit fl ows.

Real Estate Market Measures • Cut in risk weightage on loans to developers to 100% from 150%. • Loans to developers restructured up to 30 June 2009 to be treated as standard assets. • Lower home loan rates for loans up to Rs 2 million. • Allow access to foreign funds for development of integrated townships. • Encourage state governments to release land for low and middle income housing schemes. Indonesia • Reduce excise duty on construction materials such as steel and cement. Policies Impact New Tax Law • New tax regime and subsidies Impact • Cut corporate income tax to 25% for businesses to prop up the • Measures will encourage domestic in 2010. residential property market as more consumption and create employment. • Income tax rate for individuals international companies set up • Additional liquidity will be injected reduced to a fl at 30% and taxable offi ces in the country. into the market and further income raised to Rp 15.84 million • Increase in purchasing power will encourage banks to lower per year. enhance domestic consumption mortgage rates. and demand for housing. • Greater affordability will boost US$6.3-billion Stimulus Package • Subsidies and tax rebates housing demand from lower and • Tax savings of Rp 43 trillion. will benefi t developers and middle income groups. • Waive taxes and import duties for reduce construction costs for • Expected to ease credit constraints businesses and certain households project developments. for property fi rms and improve amounting to Rp 13.3 trillion. sentiments of foreign investors. • Subsidies and government • Lower construction costs is spending for businesses totalling expected with cuts in excise duty Rp 15 trillion for businesses. and VAT on construction materials.

Operations and Market Review Asian Resilience 83 Operations and Market Review Singapore – Residential

Adding premium to its residential portfolio, Keppel Land remains committed to creating desirable homes with its quality hallmark.

Keppel Land Limited 84 Report to Shareholders 2008 HarbourFront Ofﬁ ce Park and VivoCity, a retail and entertainment hub. The upcoming Resorts World at Sentosa, which features a Universal Studio theme park, will inject greater vibrancy into this exclusive precinct.

Caribbean at Keppel Bay and Reﬂ ections at Keppel Bay are the ﬁ rst two projects within the precinct which are developed to meet the rising demand for urban waterfront living. The remaining three residential plots, one of which is located on Keppel Island linked by the iconic Keppel Bay Bridge, will be rolled out in phases. Each of these developments will have its own unique design offering an unparalleled world-class waterfront lifestyle at this premier location.

Marina Bay Suites Homes at Marina Bay Financial Centre will have a wide variety of lifestyle and entertainment offerings within easy reach. Designed by world-renowned architect, Kohn Pedersen Fox Associates, the 66-storey Marina Bay Suites is situated New Launches This iconic landmark features a right at the heart of Singapore’s new Refl ections at Keppel Bay sculpture-like clubhouse which offers a fi nancial district. Within its vicinity is a Designed by world-renowned Daniel full range of recreational facilities to meet wide variety of lifestyle and entertainment Libeskind, Refl ections at Keppel Bay the lifestyle of discerning homeowners. options like the Marina Bay Sands features six undulating glass towers of It is also one of the most ecologically Integrated Resort, Esplanade – Theatres 41 storeys and 24 storeys as well as responsible developments with a on the Bay and Gardens by the Bay. It 11 villa blocks of six to eight storeys. myriad of eco-innovations and also offers ease of accessibility via the The alternating heights of the towers energy-saving devices. upcoming Marina Coastal Expressway will create an arresting interplay of and the future Landmark MRT station. changing light planes and refl ecting Homeowners will enjoy 10 years of angles, presenting spectacular views complimentary membership and fi ve The development comprises 218 at every turn. years of free subscription to the luxuriously-appointed 3-and 4-bedroom world-class Marina at Keppel Bay, units ranging from 1,600 to 2,700 sf and Crowned with sky gardens on sloping which is located on the private Keppel three penthouses ranging from 4,700 to roof lines, the towers are connected by Island linked by a cable-stayed bridge. over 8,100 sf. The typical fl oor has only skybridges which will provide pockets Marina at Keppel Bay features an four apartments with private lift lobbies in of open spaces high above ground for exclusive members’ lounge, berthing every unit, while the solitary single-level appreciating the panoramic views of the and yacht chartering facilities, a sailing penthouse and two duplex penthouses sea and the lush surroundings. These academy and gourmet restaurants. each boast their own swimming pool. include Mount Faber, Keppel Club Golf Course, Labrador Park, the upcoming Future Launches Madison Residences Resorts World at Sentosa and the More Waterfront Homes Madison Residences is conveniently city skyline. at Keppel Bay located along Bukit Timah Road, Sprawling over an area of 30-ha, the and is a stone’s throw away from Scheduled to be completed in 2013, this Keppel Bay precinct will integrate Orchard Road. 1,129-unit condominium features choice premier waterfront homes, a private units of 1- to 4-bedroom with sizes marina and prime offi ce buildings. It is It is also close to the upcoming Stevens ranging from 700 square feet (sf) studio a fi ve-minutes’ drive from the central MRT station and premier schools such apartments to a super penthouse of business district (CBD) and is part of as Singapore Chinese Girls’ School 13,300 sf. More than 630 units have a vibrant waterfront city in southern and Anglo-Chinese School (Barker Road). been sold as at end-February 2009. Singapore comprising Sentosa island,

Operations and Market Review Singapore – Residential 85 Operations and Market Review Singapore – Residential

Fulﬁ lling the promise of a true waterfront lifestyle, Marina at Keppel Bay is Singapore’s new luxury and entertainment hotspot.

Keppel Land Limited 86 Report to Shareholders 2008 The 18-storey condominium School (Primary), Anglo-Chinese School Looking Ahead development with a contemporary (Junior) and St Joseph’s Institution Keppel Land will continue to monitor architectural design will comprise 56 Junior School. the residential market closely and make exclusive units, made up of 48 units use of the current downturn to position of 3-and 4-bedroom apartments, The 486-unit development comprises itself for the upturn. six units of junior penthouses and two 30- and 36-storey towers of 1- to units of luxurious penthouses. Unit 4-bedroom units and exclusive The Group will focus on selling launched sizes range from 1,460 to 4,000 sf. penthouses with fl oor areas ranging projects while holding back new launches from 520 to 3,300 sf. About 96% of until market conditions improve. Given The Promont the development has been sold as at their good quality and locations, these The Promont is located atop Cairnhill end-February 2009. projects will realise better value when Circle and it offers 15 exquisite units residential prices recover. of about 2,000 sf each in unit size. The Tresor With just one unit per fl oor, residents The Tresor is an exclusive fi ve-storey As the crisis will also bring about good will enjoy exclusive access through condominium development located value opportunities, Keppel Land will their private lift lobbies. within the prime residential enclave in seek to invest in future growth through District 10. opportunistic acquisition of attractive This boutique development with a residential sites at good value. modern architectural design will be The development is close to the fi tted with high-end fi nishes and facilities. future Duchess MRT station and The development is near the popular top educational institutions such as Anglo-Chinese School (Junior) and is a Nanyang Primary School, Raffl es Girls’ mere fi ve-minutes’ walk to Orchard Road. Primary School, Hwa Chong Institution, Nanyang Girls’ School and National Existing Residential Properties Junior College. The Tresor is also a Caribbean at Keppel Bay short drive away from Orchard Road Comprising 969 apartments, Caribbean and the CBD. at Keppel Bay offers homeowners an exciting waterfront lifestyle experience. Comprising 62 units of 2- to 4-bedroom apartments with sizes ranging from It is only a short drive to the CBD and 990 to 2,190 sf, more than 60% of within walking distance to VivoCity The Tresor have been sold as at shopping mall and the largest end-February 2009. entertainment hub at St James Power Station. Nassim Woods Nassim Woods is an exclusive All 801 launched units have been sold. development nestled in a wooded The remaining 168 units are leased out hillside amidst a distinguished as corporate residences, which are neighbourhood of foreign embassies, much sought after by the expatriate country clubs, Botanic Gardens, fi ve- community with average occupancy star hotels and good-class bungalows. of over 90% as at end-February 2009. It is also a short walk from the shopping belt at Tanglin and Orchard Road, Park Infi nia at Wee Nam and a short drive to the Raffl es Place Nestled within the Newton residential business district. district, Park Infi nia at Wee Nam was completed in 2008. This development offers for lease 35 units of 3- and 4-bedroom apartments It is conveniently located within walking and penthouses, with unit sizes distance to the Newton MRT station, ranging from 1,970 to 6,400 sf within Novena Square shopping mall and landscaped Balinese-style grounds. Newton Hawker Centre. It is also a Favoured by expatriates from Europe fi ve-minutes’ drive to the Orchard Road and the US, Nassim Woods enjoys shopping belt. Reputable schools close to 90% occupancy as at around its vicinity include Anglo-Chinese end-February 2009.

Operations and Market Review Singapore – Residential 87 Operations and Market Review Singapore – Residential

Market Review

recover swiftly when the global economic environment improves.

Residential Short-term Challenges, Longer-term Opportunities The global recession has caused the private residential property market to slow down signiﬁ cantly. Based on statistics released by the Urban Redevelopment Authority (URA), residential prices declined by 4.7% in 2008 compared to a 31.2% increase in 2007. New home sales also fell to a record low of 4,264 units compared with the bumper 14,811 units in 2007.

The outlook for the residential market is expected to remain challenging in 2009 until a more sustained recovery in the economic and ﬁ nancial environment is in sight. Residential sales are expected to remain low with property consultants CB Richard Ellis (CBRE) and DTZ both projecting take-up of 5,000 to 6,000 Singapore continues to draw conﬁ dence with sound fundamentals. units for 2009.

However, several factors will help support Economy The government has also initiated a the housing market. The government has Weathering Recessionary Times $20.5 billion Resilience Package to introduced Budget measures for the Singapore entered into a recession after save jobs, keep businesses afl oat and property market, including the deferment the economy contracted in the second help avert a more severe economic of property tax, extension of the half of 2008 due to the unprecedented downturn. Some of the $1.3 billion completion period for residential global fi nancial and economic crisis. worth of deferred construction projects developments, allowing reassignment The Singapore economy grew by 1.1% have been brought forward in a bid of sites, extension of period to dispose in 2008, which is substantially lower to boost the economy. The expected of all residential units and allowing than the 7.8% growth achieved in the opening of the two integrated resorts in developers to rent out unsold units. previous year. 2009/2010, the hosting of the Formula One Singapore Grand Prix race and the These measures will provide cash fl ow Considerable uncertainty remains and fi rst Youth Olympic Games in 2010 are reliefs and more fl exibility to developers recovery will depend largely on global also expected to create jobs and boost in phasing the construction and sale factors in restoring confi dence in the tourism dollars. of their projects in accordance with fi nancial markets and reviving credit market conditions. The government’s fl ows. The Singapore economy is Given Singapore’s strong fi scal position, assurance that it is monitoring the expected to contract further by 2% sound fundamentals and political property market closely and will implement to 5% in 2009. stability, the city-state is expected to more measures if necessary to lend stability to the market provides an

Keppel Land Limited 88 Report to Shareholders 2008 Private Residential Demand, Supply and Price Index

Units Index 16,000 180 14,811 14,016 14,000 170 170.8

12,000 160 11,069 11,147 162.8

10,000 150 8,955 8,201 8,000 140

6,107 6,000 130 130.2 4,264 4,000 120

118.2 2,000 110 No. of new units launched No. of new units sold 0 100 URA private residential 2005 2006 2007 2008 price index Source: URA

added level of comfort for developers. to be further reduced over the next fi ve Singapore’s transformation into a vibrant In line with softening property values, years as more completion dates are and livable global city, its increasingly the development charge for non-landed being pushed back to 2012 and beyond. diversifi ed economy and spin-off properties has been further lowered by Between 2009 and 2013, DTZ expects businesses from the two integrated an average of 15% on 1 March 2009, in the average annual completion of new resorts will also continue to underpin addition to a 6% reduction in September private homes to be 9,143 units per demand for quality homes in the 2008, the fi rst decline in fi ve years. annum, which is 21% lower than URA’s medium term. estimate of 11,626 units. Suspension of the Confi rmed List Singapore under the Government Land Sales programme for the fi rst half of 2009 2007 2008E 2009F 2010F as well as deferred construction and Real GDP growth (%) 7.8 1.1 -2 to -5 1.9 launch of new projects by developers Commercial banks’ prime rate (average, %) 5.3 5.4 5.3 5.2 will help to keep potential supply in Inward FDI (US$ bn) 24.1 15.4 5.5 6.9 check and moderate the demand- Exchange rate (S$/US$, average) 1.507 1.415 1.56 1.57 supply imbalance. DTZ expects the Personal disposable income (US$ bn) 82.4 91.3 78.3 81.1 potential completion supply CPI change (average, %) 2.1 6.5 0.9 1.8 Source: Economist Intelligence Unit and Singapore Department of Statistics

Operations and Market Review Singapore – Residential 89 Operations and Market Review Singapore – Commercial

Keppel Land’s sterling ofﬁ ce portfolio stands it in good stead to grow with Singapore’s development into a multi-hub business destination in Asia.

Keppel Land Limited 90 Report to Shareholders 2008 Offi ce via its own underground pedestrian Prime Developments in network to the new Landmark MRT Financial and Business Districts station and the Raffl es Place MRT station. Keppel Land, together with its joint venture partners, currently owns and Jointly developed by Keppel Land, manages 7.4 million sf net lettable area Cheung Kong (Holdings) and Hongkong (NLA) of quality offi ce space in the Land, and designed by internationally Raffl es Place fi nancial district and the renowned architectural fi rm Kohn new downtown at Marina Bay. This Pedersen Fox Associates, the offi ce comprises 3.8 million sf of prime Grade towers at MBFC have been developed A offi ce space under development and as a grouping of crystalline forms, 3.6 million sf of completed buildings, of sculpted and angled to refl ect light which 0.4 million sf are under K-REIT Asia, and provide a sense of depth to the a commercial real estate investment surfaces. The towers will create a unique trust sponsored by Keppel Land. and captivating profi le in the city skyline.

Despite soft market conditions, MBFC Phase One and Phase Two have Keppel Land’s sterling offi ce portfolio secured strong pre-commitment levels continued to improve rental income as of about 66% and 55%, ahead of their new and renewal leases were signed scheduled completions in 2010 and 2012 at comparatively higher rental rates. respectively. Overall, MBFC is 61% pre- Occupancy levels also remained high committed to leading companies such in 2008. as DBS Bank, Standard Chartered Bank, Barclays, Macquarie Capital Securities Projects Under Development and BHP Billiton, and is poised to become Marina Bay Financial Centre a prominent business address in Asia. A seamless extension of the CBD, the Marina Bay precinct is poised to be Ocean Financial Centre the centrepiece of Singapore’s urban Strategically located on top of the Raffl es transformation to support its continuing Place MRT station, Ocean Financial growth as a major business and fi nancial Centre (OFC) is the fourth-generation hub in Asia. Located at the heart of the offi ce building to rise at the same site precinct is Marina Bay Financial Centre as the former Ocean Building. When (MBFC), which will provide an integrated completed in 2011, it will provide live-work-and-play environment for a about 850,000 sf of Grade A offi ce 24/7 lifestyle, complemented by the space. Designed by world-renowned surrounding developments of architectural fi rm Pelli Clarke Pelli, the One Raffl es Quay, The Esplanade – 43-storey building will be state-of-the-art, Theatres on the Bay, Marina Bay Sands not only in terms of premium fi nishes Integrated Resort and other future and fi ttings but also in innovative green developments. and environmentally-friendly features which will help reduce energy With gross fl oor area (GFA) of 4.7 million sf, consumption by 35% and water MBFC will be developed in two phases. consumption by 37%. Phase One comprises about 1.6 million sf NLA of Grade A offi ce space in two offi ce In recognition of this, OFC has been towers of 33 and 50 storeys and 428 units accredited with the Green Mark of luxury homes at Marina Bay Residences Platinum Award by Singapore’s which has been fully sold. Phase Two Building and Construction Authority. comprises a 46-storey offi ce tower with about 1.3 million sf NLA of offi ce space With fl oor plates ranging from 19,000 and 221 luxurious residential units at to 23,000 sf, one of the largest in the Marina Bay Suites. The development Raffl es Place area, OFC will provide will be complemented by retail and greater fl exibility to prospective tenants. recreational facilities and will be linked OFC is among the fi rst commercial

Operations and Market Review Singapore – Commercial 91 Operations and Market Review Singapore – Commercial

buildings whose design and planning HarbourFront Offi ce Park Looking Ahead have capitalised on URA’s lighting and Conveniently located fi ve minutes away In the midst of the challenging art incentive schemes, where new from the CBD and with covered linkages environment, Keppel Land will continue developments and redevelopments in to the HarbourFront MRT station, to engage in active marketing of offi ce the CBD and Marina Bay area will be the 0.9 million sf HarbourFront Offi ce space to improve pre-commitments and granted additional GFA of up to 2% Park comprises Keppel Bay Tower, operational effi ciency. Attention will when night lighting is installed. Additional HarbourFront Tower One and also be placed on tenant retention as GFA of a maximum 2% will also be HarbourFront Tower Two. HarbourFront Keppel Land builds on existing good offered to new developments within Offi ce Park enjoys largely unobstructed tenant relationships. Keppel Land will the Central Area when public art works sea views and is within close proximity also ensure the development costs are installed and integrated with to VivoCity and the upcoming Resorts and progress of its two landmark the developments. World at Sentosa. development projects, MBFC and OFC, remain on track. Completed Buildings Under K-REIT Asia Raffl es Place Offi ce Portfolio Prime Offi ce Portfolio While the diffi cult macroeconomic The existing offi ce portfolio in the K-REIT Asia has a portfolio of fi ve prime conditions will continue to put pressure Raffl es Place is around 0.5 million sf, offi ce buildings, namely Prudential Tower on offi ce take-up and rentals, a comprising Ocean Towers and Equity (approximately 44% of the strata area well-diversifi ed tenant mix and below- Plaza, which are majority-owned of the building), Keppel Towers and market portfolio rents will help buffer by Keppel Land. Equity Plaza is GE Tower, Bugis Junction Towers and the Group’s offi ce portfolio against undergoing upgrading works, which One Raffl es Quay (one-third interest). downside risks in the year ahead. are expected to be completed in Conveniently located in different parts Keppel Land’s and K-REIT Asia’s March 2009. The upgrading works of the CBD, the buildings enjoy a portfolios of well-located quality offi ces will give the building a new lease of diverse and quality tenant base. are well poised to take advantage of life and adding of passenger lifts and “fl ight to quality” which occurs during green features to bring about energy a downturn and strengthening demand effi ciency and operational cost savings. when the economy recovers.

Marina Bay Financial Centre is envisioned to provide an integrated live-work-and play environment for a 24/7 lifestyle.

Keppel Land Limited 92 Report to Shareholders 2008 Market Review

Offi ce Recovery Hinges on Economic Rebound The escalation of the global fi nancial crisis into a world economic crisis has stifl ed economic growth and eroded business confi dence. Demand for offi ce space has fallen as fi nancial institutions and corporations downsized their operations or shelved their expansion plans in Singapore. Offi ce demand was a negative 0.37 million sf in the fourth quarter of 2008 after 4½ years of positive demand. Full-year take-up fell to 0.19 million sf, which was signifi cantly lower than the 15-year historical average annual take-up of about 1.5 million sf from 1994 to 2008.

While offi ce occupancy fi gures remain high, the average occupancy rates of islandwide and Grade A offi ce spaces fell to 91.2% and 99.1% respectively as at end-2008 compared with 92.7% and 99.8% respectively as at end-2007. Keppel Bay Tower, part of the HarbourFront Offi ce Park, continues to enjoy good rentals and occupancy. Occupancy in the Core CBD area also declined to 95.4% in the fourth quarter from 97.6% a year ago. the fi rst half of 2009. This will help to However, tenants with upcoming ease concerns on impending supply renewals and rent reviews may still The strong rental growth as seen from glut in the face of falling demand for face reversionary rents that are higher 2005 to 2007 has dissipated as offi ce space. The existing ban on than rents for leases committed three demand slows down. Grade A rents conversion of offi ce space in the CBD to four years ago when prime offi ce fell 12.5% year-on-year to an average to other uses has also been lifted. rents ranged from $4.65 psf in the of $15.00 per square feet per month fi rst quarter of 2005 to $7.81 psf in the (psf pm) in the last quarter of the year, In addition, the government has fourth quarter of 2006 while Grade down from $17.15 psf pm at end-2007. announced several Budget measures A rents were between $4.80 psf and Prime offi ce rents also declined by 14% such as 40% property tax rebate for $8.73 psf over the same period. from a year ago to average $12.90 psf industrial and commercial properties, pm as at end-2008. and reduction in income tax rate from Singapore’s economic fundamentals, 18% to 17% to help corporations and sound fi nancial system and political To stabilise the market, the Ministry landlords to ride out the downturn. stability put the city-state in good stead of National Development has revised to weather the downturn. In the longer its earlier land release policy and Given the tough business environment, term, Singapore’s growth into a global transferred all of the remaining offi ce take-up and rents will continue to cosmopolitan city and diversifi cation unreleased 2008 Confi rmed List sites come under pressure until confi dence beyond a fi nancial hub into a multi-hub to the Reserve List while not making in the global economy recovers. business destination in Asia will bolster available any Confi rmed List sites for demand for offi ce space.

Operations and Market Review Singapore – Commercial 93 Operations and Market Review Singapore – Commercial

Office Demand and Supply

Million sf % 99.8 2.5 99.2 2.40 99.1 100

2.07 98 1.96 2.0 96

94 1.5 92.5 92.7 1.42

91.2 92 89.7 1.0 90

0.69 87.2 88

0.5 86 0.19 84 0.0

-0.05 82 Supply Demand -0.30 -0.5 80 Islandwide Occupancy Grade A Occupancy 2005 2006 2007 2008

Average Office Rents

$ psf per month 18 17.15

16 15.00 15.00

14 12.90

10 8.73 7.81 8

5.70 6 5.20

0 Grade A Rent Prime Rent 2005 2006 2007 2008

Keppel Land Limited 94 Report to Shareholders 2008 Located strategically in Singapore’s new fi nancial and business district, One Raffl es Quay’s major offi ce tenants include blue-chip multinational companies.

K-REIT Asia Stable Portfolio Continued Income Growth K-REIT Asia maintained its portfolio value K-REIT Asia achieved a 166.7% increase of $2.1 billion at end-2008 as valuation in distributable income to $58.2 million was within the lower end of the market in 2008 due mainly to higher rental rates range. It is suffi ciently buffered against and higher contribution from its one-third breaching the 60% statutory leverage interest in One Raffl es Quay (ORQ). Total limit unless its average portfolio valuation distribution per unit of 8.91 cents was falls by more than 54%. 18.3% higher than forecast and 1% higher than the previous year due to The portfolio’s committed occupancy of the completion of a rights issue of 99% as at end-2008 was slightly lower 396.9 million units in May. than the 99.9% occupancy achieved a year ago. Its relatively long lease terms, Net proceeds of $550.7 million from averaging 5.6 years, will provide stable the rights issue helped K-REIT Asia to income under current uncertain lower its aggregate leverage to 27.6% economic climate. as at end-2008 from 53.9% in the previous year. K-REIT Asia has no debt Average gross portfolio rent of $7.61 psf refi nancing needs until 2011. It has also is below market rents, providing the established a $1 billion multi-currency prospect of positive rental reversion. With medium-term note programme, income support until end-2011, rental providing greater fl exibility to income from its one-third interest in ORQ manage its capital requirements. is buffered against downside risks.

Operations and Market Review Singapore – Commercial 95 Operations and Market Review Singapore – Commercial

Positioned for Opportunities cash management and conducted action plans in portfolio management, and Challenges stress testing of capital requirements acquisition strategy, asset management Although the offi ce market is expected for each fund to ensure suffi cient cash and fi nancial management for each to be challenging in 2009, K-REIT Asia’s reserves. This has become a regular fund. Alpha has received encouraging portfolio of quality offi ces will benefi t fi nancial management tool and is being feedback from investors who are from “fl ight to quality” which takes place updated periodically. confi dent of its ability to manage in every downturn. through this crisis. In anticipation of weaker leasing When the recovery kicks in, offi ce market conditions, Alpha has adopted As at end-2008, Alpha manages four rents will be supported by continued a defensive asset management strategy closed-ended property funds and an demand for prime offi ce space as where the priority is to maintain high open-ended real estate securities fund. Singapore transforms into a global occupancy and minimise downtime Three of these four closed-ended funds city with spin-off multiplier effects from vacancies. This has enabled Alpha are fully drawn, of which two were fully the two integrated resorts scheduled Core Plus Real Estate Fund, which invested since end-2007. The gross to open in 2009/2010. comprises mostly income-generating value of AUM is about $3.5 billion after assets, to enjoy portfolio occupancy deducting assets divested. When the The economic downturn also presents of over 90% as at end-2008. new funds are fully leveraged and invested, opportunities for K-REIT Asia to seek total value of AUM is expected to reach selective asset acquisitions. It will also Alpha has held back acquisitions for $7.7 billion. engage in asset enhancement to the newly raised funds, holding the view optimise the NLA of its portfolio and that better investment opportunities will Looking ahead, Alpha will seek to manage improve its operational effi ciency. avail as the fi nancial turmoil unfolds. As the existing funds and assets well to ride such, less than 5% of the $1.7 billion through this downturn. Investment of the Alpha Investment Partners Alpha Asia Macro Trend Fund has been new funds is expected to gather pace Proactive Steps Taken in invested. The fund is therefore well- in anticipation of buying opportunities Preparation of Downturn positioned to take advantage of new during the year. Alpha has taken Alpha Investment Partners (Alpha) opportunities emerging from the global appropriate steps and is poised to has taken proactive steps since early fi nancial turmoil. manage well through the crisis. With the 2008 to prepare its funds and assets confi dence and support of investors, under management (AUM) for an To gain continued support, confi dence there will be vast opportunities for Alpha economic downturn. and understanding of investors, Alpha to tap on and become a leading player maintains constant communications in the industry. For funds that were fully invested, and a high level of transparency with its Alpha implemented tighter portfolio investors, providing clear strategy and

Backed by an experienced team, Alpha Investment Partners continues to gain the conﬁ dence and support of its investors.

Keppel Land Limited 96 Report to Shareholders 2008 Market Review

Property Fund Management and Overall, while Asia-Pacifi c has entered In August, National Australia Bank and Real Estate Investment Trusts into a period of uncertainty, the region’s Oxley Group jointly bought a majority Global Financial Crisis underlying long-term drivers and economic stake in the manager of Cambridge Disrupted Capital Flows growth prospects remain positive. Industrial Trust. YTL Corporation also After a strong run-up in 2007, real estate acquired interests in Macquarie Prime investment transactions in Asia-Pacifi c The burgeoning middle-class population REIT (which was subsequently renamed contracted signifi cantly in 2008 as a and urbanisation will continue to boost Starhill Global REIT) and its manager result of the global credit crunch. demand for real estate in the major cities in October. across Asia. For real estate investors, Statistics from Real Capital Analytics re-pricing of assets as a result of the With tight credit conditions, some showed that property sales in Asia- economic turmoil will present attractive REIT managers postponed their Pacifi c fell by 44% year-on-year to investment opportunities in emerging acquisition and asset enhancement US$138.8 billion in 2008. markets as well as developed markets plans as capital preservation and such as Japan. fi nancial fl exibility took precedence. New Zealand and Australia posted the largest decline of 76% to US$8.4 billion The Singapore real estate investment Some S-REITs employed rights issues compared to Japan where sales activities trust (S-REIT) market saw only one new and private placements to refi nance dipped 19% to US$34.3 billion. Sale of listing in 2008, bringing the total their loans. As refi nancing risks may development sites accounted for 49% number of listed S-REITs to 21. However, continue to loom in 2009, some of the total real estate transaction volume total market capitalisation of S-REITs S-REITs may seek to de-leverage their while offi ce property represented 29% shrank by 53.7% to $12.9 billion as balance sheets via equity issuances, of the total deal fl ow in Asia-Pacifi c. investor sentiments turned negative. reduction of dividend pay-outs, distribution reinvestment plans In the fundraising market, statistics from While unit prices softened, the average or asset sales. consultancy fi rm Preqin showed that a distribution yield of S-REITs rose to 12% total of US$24 billion was raised in 2008 as at end-2008 from 4.3% as at end- Looking ahead, investors will focus on as compared to US$21.8 billion in 2007. 2007, which is relatively attractive S-REITs with good quality underlying The largest Asia-focus fund to close compared to the 10-year government assets, resilient cash fl ows and capable in 2008 was MGP Asia Fund III, which bond yield of about 2%. management teams. Those with relatively received investor commitments of little near-term refi nancing worries and US$3.9 billion. The lacklustre performance of S-REITs strong sponsors will also be attractive sparked off management changes and to investors. consolidation during the year, with the sale of a stake in Allco Commercial REIT and its manager to Fraser and Neave.

Operations and Market Review Singapore – Commercial 97 Operations and Market Review Singapore – Commercial

Keppel Digihub Hospitality Management Data Centres Sedona Hotels International Keppel Digihub, a certifi ed business Sedona Hotels International (Sedona) continuity and disaster recovery service is the hospitality arm of Keppel Land, provider, continues to maintain its zero managing about 1,290 hotel rooms and downtime track record for its data centre serviced residences across Asia. facilities located at Serangoon North. Another Challenging Year ahead The data centre caters to the co-location International tourism experienced a needs of fi nancial institutions and large slowdown in 2008 after four years corporations, offering a secure and of positive growth due to the global fail-safe environment for the housing of economic crisis. In view of the challenging computing infrastructure that supports times, Sedona will target regional mission-critical systems. The business markets with more promotions that continuity facility provides customised seek to add value to ensure it remains solutions, including dedicated space the hotel of choice. fully equipped with workstations and supported by the data centre’s backup Indonesia power infrastructure. Hotel Sedona Manado, a premier resort hotel in the dive paradise of Manado, The additional data centre space of North Sulawesi has seen positive 12,300 sf built in 2007 has been fully results from its marketing campaigns taken up, mostly by multinational to create awareness and stimulate companies, bringing the overall data demand for room reservations. centre occupancy rate to 98%. This is testament to the high service standards Hotel Sedona Manado was named demanded by co-location customers Indonesia’s Leading Resort at the World which Keppel Digihub is more than Travel Awards on its fi rst nomination able to meet. within two years of operation. The World Travel Awards are hailed as the Looking ahead, Keppel Digihub equivalent to the Oscars, recognising will focus on large co-location excellence in the world’s travel and opportunities to optimise its data tourism industry. centre capacity. It will also look at increasing capacity in other locations. AirAsia’s launch of a new direct service between Kuala Lumpur and Manado in September 2008 has improved connectivity and made Manado a Market Review more attractive destination for regional travellers. The hosting of the Data Centres World Ocean Conference in Manado in Demand for data centre space from May 2009 is expected to benefi t the the fi nancial services sector is expected city through global publicity and a to moderate in view of the current heightened profi le as an attractive economic downturn. Provisioning of leisure destination. new data centre facilities by some existing players is still expected to Despite the global fi nancial crisis, meet demand but most are likely to Indonesia is confi dent that greater be cautious. In the meantime, available promotion on health and beauty tourism data centre facilities are enjoying high as well as marine tourism will increase occupancies with increasing rates for the number of foreign tourists by 25% in contract renewals. 2009. Hotel Sedona Manado is buoyed by Indonesia’s greater emphasis on marine tourism and will work closely with the authorities to promote the hotel.

Keppel Land Limited 98 Report to Shareholders 2008 Caribbean Residences is popular with the expatriate community and corporate clients.

Myanmar Vietnam tourism as it targets to achieve 4.5 million Sedona Hotel Yangon and Despite the challenging environment in foreign tourists in 2009. Hotels have Sedona Hotel Mandalay achieved 2008, Sedona Suites Ho Chi Minh City committed to reduce their service higher room rates through upgrading and Sedona Suites Hanoi maintained prices by 30% to 50% while the and offering guests better facilities and healthy occupancy levels of more national carrier, Vietnam Airlines, has services. Both hotels work synergistically than 90%. similarly pledged to lower prices by to expand their product offerings and 30% to 50% for both domestic and customer base through the ‘Twin Cities’ 2009 is expected to be a difﬁ cult year. international ﬂ ights. programme which encourages guests Serviced apartments may see lower to stay at both hotels. rental rates due to a possible decline in Sedona Suites Ho Chi Minh City and expatriate postings and smaller housing Sedona Suites Hanoi are regular Sedona Hotel Yangon was named allowances as MNCs cut back on recipients of the Vietnam Economic Myanmar’s Leading Hotel by the expatriates’ rental allowance and downsize Times magazine’s Guide Awards for World Travel Awards while Sedona to smaller apartments to save costs. the Best Business Serviced Apartment Hotel Mandalay was nominated for and Best Luxury Serviced Apartment the same award during the year. Vietnam’s tourism board has implemented respectively. a nationwide promotion to stimulate Singapore Caribbean Residences maintained its occupancy at above 90% in 2008. Properties Managed by Sedona Hotels International As the Singapore economy entered into a recession, serviced and corporate Country Name of Property No. of Rooms residences face downward pressure Indonesia Hotel Sedona Manado 247 on lease rates as multinational Myanmar Sedona Hotel Yangon 366 corporations (MNC) reduce their expatriates’ postings and relocation Sedona Hotel Mandalay 247 budgets, Caribbean Residences will Singapore Caribbean Residences 168# work to expand its pool of corporate Vietnam Sedona Suites Ho Chi Minh City 89 clients through targeted marketing channels. Sedona Suites Hanoi 175 Total 1,292

# Include two units used as ofﬁ ces

Operations and Market Review Singapore – Commercial 99 Operations and Market Review Overseas

With an established reputation and strong regional network, Keppel Land is poised to capitalise on opportunities in the overseas markets where it operates.

Keppel Land Limited 100 Report to Shareholders 2008 Residential Park Avenue is located near the Condominiums well-known Nanjing West Road Shanghai commercial belt and major hotels. Residential Development in Nanhui These include Plaza 66, Shanghai Centre, The development is located on a 26.4-ha Citic Centre, the Shanghai Exhibition site in Xinchang Town in Nanhui District Centre as well as the Portman in southeastern Shanghai. The project, Ritz-Carlton and JC Mandarin hotels. spread over four parcels, will comprise The Shanghai Children Hospital and some 2,750 mixed units of terraces one of Shanghai city’s top primary and high- and low-rise apartments, schools, First Centre Primary School, complemented by full-facility clubhouses are also within walking distance to and retail outlets. The site will be linked Park Avenue. by a new Mass Rapid Transit (MRT) line nearby, which will be completed in 2012. One Park Avenue The residential development, comprising The Nanhui District has become a key 1,118 apartments, was fully sold in 2003 zone for Shanghai’s cargo development and handed over to buyers in 2005. and manufacturing hub, with easy access to Pudong International Airport 8 Park Avenue and Yangshan Deep Water Port. In Comprising 946 apartments spread over 2008, more than 30 industrial projects 10 high-rise blocks, 8 Park Avenue is were started, with total investment equipped with clubhouse facilities that exceeding RMB 4.6 billion. include an indoor heated swimming pool, gymnasium, tennis courts and bowling To support the activities of the Yangshan alley among others. All 456 units in the Deep Water Port as well as trade-related ﬁ rst ﬁ ve blocks have been sold and industries and services, the Shanghai handed over to buyers. Some 99% of government will be building a Harbour the 96 units in the sixth block have been City in southeastern Nanhui. The Harbour sold and will be handed over to buyers City is expected to house industrial parks in 2009. Planning is currently underway and 800,000 people by 2020. for the remaining blocks.

With increased economic activities and Villa Riviera opportunities pouring into the Nanhui Keppel Land’s ﬁ rst villa development District, more locals are expected to move in Shanghai, Villa Riviera comprises into the area. Keppel Land’s project is 168 units of villas, semi-detached and well-positioned to tap on the growing terraces, with a full-facility clubhouse, housing demand, which is expected to including indoor heated swimming be supported by strong owner-occupier pool, gymnasium, tennis courts and demand over the next few years. function rooms.

Park Avenue All 42 units launched in Phase One and Park Avenue precinct comprises three 76% of the 46 units launched in Phase projects – One Park Avenue, 8 Park Two have been sold as at end-February Avenue and Park Avenue Central. 2009. About 30% of the 29 units Located in downtown Shanghai in the launched in Phase Three have also prime Jingan District, Park Avenue is been sold at end-February 2009. highly accessible, close to expressways The remaining units are scheduled to and the Jingan metro line. Another metro be launched in 2009. station on Line 7 is being built nearby and is scheduled to be completed by end-2009.

Operations and Market Review Overseas 101 Operations and Market Review Overseas – China

Located in the Xujing Town of Qingpu and 15 km to the city centre and the District, Villa Riviera is about 1 km from Tianjin Airport respectively. With easy the Xujing Town Centre and 30 minutes’ accessibility to the highways, The drive to Shanghai’s city centre. Access Arcadia is a two-hour drive to Beijing will be further improved with the extension and a 45-minute drive to Tianjin of MRT-Line 2 to the area, which will be Economic-Technological Development completed in 2010. Nearby amenities Area (TEDA). include the recently-opened hypermart Carrefour as well as the American, The Arcadia is a premier residential French, German and Singapore enclave comprising 168 units of international schools, which cater to exclusive villas. Each villa has a land the expatriate population in the area. area varying from 320 to 600 sm and gross ﬂ oor area (GFA) of between 300 Villas and 450 sm. These villas are designed Tianjin to cater to the local upper-income class The Arcadia and expatriate communities. The Arcadia is a high-end villa development located in Jinnan District, Homebuyers can enjoy access to Tianjin. Situated along the Outer Ring facilities like a clubhouse with indoor Road, it is about 4.5 km to Meijiang, swimming pool, gymnasium and tennis a prestigious and one of the most courts in the adjacent Original County sought-after residential suburbs in project. Other upcoming amenities Tianjin. It is also located about 12 km in the vicinity include a golf course, a

Leveraging its extensive experience and expertise in developing world-class waterfront precincts, Keppel Land will present a new and refreshing waterfront lifestyle to homebuyers in Zhongshan, China.

Keppel Land Limited 102 Report to Shareholders 2008 shopping mall and other supporting commercial facilities.About 50% of the 81 launched villa units have been sold as at end-February 2009.

Townships Shenyang Residential Development In 2008, Keppel Land further strengthened its presence in China with the acquisition of another 102,757-sm site in Shenbei New District, Shenyang. This new site is adjacent to the fi rst site of 235,530 sm which was acquired in 2007. The combined site will house an integrated township development with a mix of mid- and high-rise apartment blocks. It is The Arcadia, an exclusive high-end villa development, augments Keppel Land’s portfolio of estimated that the entire development premier villa homes in China. will yield approximately 6,200 homes, with total GFA of over 743,847 sm. mix of low- and high-rise apartment address for many Wuxi residents, due Targeted at the upper-middle income blocks, commercial buildings, and to the developments in this area. homebuyers, the township will feature supporting amenities including 2- and 3-bedroom apartments with kindergartens, a primary school, The entire township will comprise a total unit sizes ranging from 90 to 130 sm. clubhouses, recreational facilities, of about 5,000 residential units targeted Set amidst lush landscaped gardens, parks, a market and car park facilities. at Wuxi’s middle- to upper-middle residents can enjoy recreational facilities income groups. The Singapore-styled such as a clubhouse, tennis court, a Since 2005, The Botanica has launched township will comprise a mix of residential gymnasium, basketball courts and a 3,915 units, of which about 85% were apartments, commercial and offi ce children’s playground. sold and 40% were handed over to buildings, and supporting amenities purchasers by end-February 2009. nestled within a sprawling landscape. Chengdu Despite the Sichuan earthquake in The Botanica May 2008 which has affected market A total of 880 units under Phase One The Botanica is a 417,139 sm residential sentiments, some 421 units in Phase have been launched since September township developed by CityOne Township Four was launched in September 2008 2007 and more than 80% have been Development (City One), a 50:50 joint and more than 50% have been sold by sold as at end-February 2009. Amidst venture between Keppel Land and end-February 2009. the current market sentiment, Phase Two Surbana Corporation. is further divided into sub-phases to Wuxi shorten the construction completion Located in the southeastern sector Central Park City rate and to better match demand. of Chengdu, at the junction of Third Following the success of The Botanica Ring Road and Cheng Long Road, in Chengdu, CityOne is developing Zhongshan The Botanica has easy access to a second township site in Wuxi, Integrated Marina major roads. It is about a 15-minute Jiangsu Province. Lifestyle Development drive from the city centre and close Keppel Land has embarked on its to the Sichuan Normal University. The 352,534 sm site is located in fi rst integrated residential cum marina The township is also located next to the southern part of Wuxi and is lifestyle development in the affl uent the proposed new eastern suburban within Taihu New City, a development Pearl River Delta (PRD) region of administrative centre of Chengdu. area envisioned by the municipal Zhongshan, located on MoDao Island government as the secondary city in the Shenwan Town of Zhongshan The entire township will be developed centre and home to the new municipal City, Guangdong Province. over seven phases and will yield about administrative offi ce, commercial and 9,400 residential units catering to residential developments, a university Currently, 20 ha of the total 87-ha Chengdu’s growing middle-income town and an IT Park. Taihu New City waterfront site has been secured and group. The township will comprise a has now become a desirable residential the project is at its master planning

Operations and Market Review Overseas – China 103 Operations and Market Review Overseas – China

Keppel Land will contribute to the fulﬁ llment of the vision of the Sino-Singapore Tianjin Eco-City as a sustainable and attractive model city to the world.

stage. The entire development is Resort in the latter half of 2008. Of the 55 units expected to yield about 300 high-end Kunming launched under Azalea III and La Quinta luxurious villas with private berths and Spring City Golf & Lake Resort (Phase One), 65% have been sold as at 2,500 condominium units and serviced Opened in 1998, Spring City Golf & end-February 2009. apartments with a total GFA of Lake Resort (Spring City) is a world-class 408,000 sm. golf resort. It has two championship golf Due to weak market sentiments, courses designed by Jack Nicklaus the launch of new units under La Residents can look forward to an iconic and Robert Trent Jones II, and enjoys Quinta (Phase Two) and The LakeHill integrated marina lifestyle enhanced scenic mountain and lake views with (Phase One) will be deferred till market by a marina clubhouse with related a spring-like climate all year round. conditions improve. amenities including fi ne dining restaurants, Located on the east shore of Lake Yang berths for about 550 boats, a boating Zong Hai, it is a 30-minute’ drive from Eco-City school and comprehensive recreational Kunming City and has easy access to Tianjin facilities. Approximately 30% of the the Kunming Airport, which offers direct Sino-Singapore Tianjin Eco-City total land area will be used to create fl ights to many cities in Asia. In November 2007, Singapore and channels and waterways for berths. China signed the Eco-City Framework Spring City continues to be a popular Agreement to build an Eco-City in Tianjin. The development will be positioned golfi ng destination, receiving some Covering 30 sq km, Sino-Singapore as one of the fi rst premium waterfront 60,000 golfers and visitors in 2008. Tianjin Eco-City (SSTEC) is envisioned housing in the region, offering private Spring City has also received several to be an economically thriving, berthing amenities, leisure facilities, international and accolades in 2008. environmentally-friendly and socially and comprehensive marina recreational harmonious city to be developed over activities to residents and visitors. Sales of resort homes in Spring City 10 to 15 years. It has a start-up area of have been modest during the year, despite approximately 4 sq km to be developed the onset of the global fi nancial crisis in three to fi ve years.

Keppel Land Limited 104 Report to Shareholders 2008 In July 2008, a 50:50 joint venture Engineers & Constructors Pte Ltd to Stamford City is a mixed development company was formed by the Chinese work on the feasibility study for the project in Jiangyin. Phase One, consortium led by Tianjin TEDA development of a US$1 billion solar comprising 150 units, was launched in Investment Holding Co. Ltd and Singapore polysilicon production plant in the Eco 2008 and more than 50% have been consortium led by the Keppel Group. Production Zone. This demonstrates sold as at end-February 2009. The entity will oversee and manage the the potential of the Tianjin Eco-City to development of the entire SSTEC. develop as a premier business hub for Summerville, Evergro’s project in eco business clusters such as renewable Changzhou, comprises 566 residential Keppel Land will participate as an energy, water and environmental, and units with a build-up area of 86,600 sm. investor and member of the consortium, green urban solutions. More than 80% of the units have been as well as project manager in the sold as at end-February 2009. property development of a 30-ha site Evergro Properties within the 4-sq km start-up area. China-focused subsidiary, Evergro With the development of the SSTEC Properties (Evergro), focuses on and Tianjin being designated as the With a planned population of about 85,000, developing quality residential properties economic centre for northern China, the start-up area will be developed in with integrated lifestyle elements in Evergro’s residential projects in Tianjin three stages. Stage One development second-tier growth cities. such as Serenity Cove will beneﬁ t from occupies a land area of approximately the region’s development. 110 ha or one-third the size of the start-up Evergro has established business area. It will comprise residential networks and a sizeable residential Phase Two of Serenity Cove was developments, a commercial sub-centre landbank in Tianjin, Jiangyin and launched in December 2008 with a and a business park. Infrastructure Changzhou. It has also developed saleable GFA of 38,000 sm. Planning development is also due for completion golf courses in Tianjin and Jiangyin, for Phase Three development will towards end-2010. both of which have been completed continue with particular emphasis on and operational. design, green features and overall SSTEC has signed a Memorandum product attractiveness. of Understanding with Sembawang

Evergro Properties’ residential projects in Tianjin will beneﬁ t from the region’s development.

Operations and Market Review Overseas – China 105 Operations and Market Review Overseas – China

Market Review

Economy US$8,594 in 2007, while personal in May 2008, the economic outlook for Asia’s Economic Growth Engine disposable income of urban residents Chengdu remains positive. Unlike coastal China’s economy remained resilient rose 12.9% to US$3,894. FDI reached cities which are export-dependent, with GDP growth of 9% in 2008. US$1.71 billion, up 15.6% from 2007. Chengdu’s economy is mainly supported Notably, this is the lowest GDP growth by domestic economic activities. In the since 2001 when the economy grew Moving ahead, the Shanghai municipal medium term, reconstruction efforts by 8.3%. This is also the fi rst time that government plans to inject RMB 500 post-earthquake and fi scal spending China has recorded single-digit growth billion (US$73.5 billion) into urban from the stimulus package will help since 2003. However, China will continue construction. Of this, RMB 160 billion boost the economy. As a cornerstone to be the growth enginefor Asia and (US$23.5 billion) will be used for of the central government’s “Go West” a key driver of global growth as the infrastructure construction. The economy policy, Chengdu is also expected to country contributed more than 20% of is also expected to benefi t from the continue to attract investment, fuelling global economic growth in 2008. World Expo 2010-related projects. economic growth in the long term.

According to the General Administration Positive Spillover Effects from Sustainable Growth in Tianjin of Customs, China’s exports and imports Beijing Olympics Tianjin’s economy maintained its robust growth, with GDP growth of 16.5% declined for a second consecutive Beijing’s economy grew by 9% in 2008, in 2008. The Tianjin Binhai New Area month in December. Exports fell 2.8% compared to 11.4% in 2007. Growth was (TBNA) area posted GDP growth of year-on-year to US$111.16 billion, while supported by strong FDI as well as 23% from a year earlier. FDI reached imports fell 21.3% to US$72.18 billion domestic consumption, which totalled US$7.42 billion in 2008. Total fi xed in 2008. US$57 billion and US$67 billion assets investment was US$49.4 biliion respectively. GDP per capita surpassed in 2008, up by 42.5% from 2007. Statistics from the Ministry of Commerce US$8,000, second after Shanghai. showed that foreign direct investment To further boost domestic consumption (FDI) was US$92.4 billion in 2008, an Despite the challenging global economic and economic development, the Tianjin increase of 23.6%. However, the pace climate, the positive spillover effects of the municipal government plans to implement of growth was slower than the 35% 2008 Beijing Olympics and the city’s existing projects, especially in agriculture, increase for the fi rst 10 months of the year. sizeable demand and investment energy resources and environment to potential are expected to support achieve full-year targeted investment of According to the World Bank, China’s Beijing’s economic growth. Beijing also RMB 100 billion, strengthen fi nancial economic growth may slow down to 7.5% plans to invest a total of US$20.4 billion sector and increase fi nancing channels, in 2009. Nonetheless, the country has (RMB 140 billion) in public expenditure as well as raise domestic consumption. adequate instruments and policies to over 2009 to 2010. TBNA also plans to undertake large keep the economy moving at a healthy projects with total investment exceeding pace. The stimulus packages recently Chengdu, the Gateway to RMB 300 billion over the next three announced will help cushion the Western China years. The various preferential economy from the effects of the global Chengdu’s economy grew by 12.1% in and reform policies will increase the economic crisis. 2008 to US$57 billion (RMB 390 billion). city’s competitiveness in attracting While this is lower than the previous year’s new businesses. Continued Economic Growth growth of 15.3%, it is still higher than in Shanghai the national GDP and maintained its Shanghai achieved GDP growth of 9.7% double-digit growth since 2003. The total Wuxi, the Fourth Largest in 2008, the fi rst single-digit growth after amount of FDI reached US$5.01 billion, Economy in YRD 16 years of double-digit growth. This was, up by 47.9% year-on-year. As one of the main drivers behind the however, still higher than the national Yangtze River Delta (YRD) economic GDP growth. GDP per capita increased Despite the impact of the global economic region, Wuxi has achieved annual 17.7% to US $10,529 compared with slowdown and the Sichuan earthquake growth rates of above 15% over the

Keppel Land Limited 106 Report to Shareholders 2008 As the tourism and industrial centre of the Jiangsu Province, Wuxi boasts strong domestic consumption and a robust economy.

last fi ve years. In 2008, Wuxi’s GDP Zhongshan to Benefi t from Due to credit tightening and the reached US$64.7 billion 12-year Plan for PRD government’s ban on commercial (RMB 443.2 billion), placing it the As one of the earliest coastal cities to banks in granting loans to real estate fourth largest economy in the YRD. open up its economy, Zhongshan is now companies with land as collateral, a modern mid-sized city with a population the real estate sector was affected in Economic growth is driven mainly by of nearly 2.5 million. In 2008, it achieved the second half of 2008. Real estate the strong manufacturing industry and a GDP growth of 10.5%. Per capita investment grew by 33% in the fi rst tourism sector. Known also as “The Pearl permanant resident disposable income half of the year, but total investment in of Taihu” and “Little Shanghai”, Wuxi was RMB 21,561. FDI rose 13.4% to real estate development only grew by is the tourism and industrial centre of reach US$833 million in 2008. 20.9% in 2008. the Jiangsu Province. The city also possesses a wide manufacturing base in As one of the nine cities under the PRD, In the wake of the global economic precision machinery, electronics and Zhongshan is set to benefi t from the 2008 crisis and slower economic growth, other industries. Wuxi’s economy is to 2020 development plan which was the Central Government introduced a expected to remain robust, fuelled by unveiled by the Chinese government RMB 4 trillion (US$586 billion) stimulus foreign investment and strong domestic in January 2009. The delta region is package and a series of supportive consumption. envisioned to maintain its lead in terms measures for the property market to of economic power within China and stimulate domestic demand. Strong Economic Growth expand into a pan-PRD area that will in Shenyang have a greater infl uence on the regional In 2008, the People’s Bank of China Shenyang’s economy grew 16.3% in development of south China and the cut its interest rates fi ve times. The 2008, exceeding the 13% to 15% target national economy. one-year benchmark lending rate was set for year 2010 under the city reduced to 5.31% in December 2008 government’s 11th Five Year Plan Property Market against 7.47% in December 2007 (2006 to 2010). Average urban Supportive Measures to and the reserve requirement ratio disposable income reached US$2,525 Stimulate Domestic Demand for lenders was lowered by 0.5% to in 2008, an increase of 18.4% over the According to the National Bureau of 13.5%. The reduction in the reserve previous year. Statistics, China’s fi xed asset investment requirement ratio is estimated to rose 25.5% to US$2.52 trillion release US$43 billion (RMB 300 billion) The government expects GDP growth to (RMB 17.23 trillion) in 2008. Urban fi xed for possible lending by commercial slow to 14% in 2009. As the business asset investment was US$2.2 trillion banks. hub and gateway city of northeast (RMB 14.82 trillion), an increase of China, strong economic activities 26.1%. However, fi xed asset investment will continue to sustain growth city in in December grew at a slower rate of the long term, as more investors and 21.9% compared to the 26.8% increase companies enter the region. in the fi rst 11 months of 2008.

Operations and Market Review Overseas – China 107 Operations and Market Review Overseas – China

Residential Market These include relaxing the residency To boost the property market, the Stimulus Measures to Boost requirement and removing restrictions Tianjin municipal government released Shanghai Housing Market on foreigners buying property in Beijing. measures including allowing overseas Shanghai’s housing market slowed investors to use foreign-currency down in 2008, impacted by the global In the medium- to long-term, Beijing’s margin to participate in public bidding economic crisis. Total sales volume in residential market is expected to remain for land-use right of Tianjin’s state land in 2008 was about 0.2 million units, down resilient, underpinned by rural-urban 2009. More measures were introduced 33% from the previous year. Prices migration, growing middle-class population in November to encourage the use of of homes within the Inner Ring Road and rising disposable income. housing provident fund for property dropped by an average of 11% in 2008. purchases. These moves are expected However, price drop of high-quality Chengdu to Benefi t from to improve market sentiments. developments in prime locations was Revitalisation of Western China less signifi cant. Property sales volume decreased by In the medium to long-term, government 45% year-on-year in 2008, due to cooling policies and initiatives to develop Tianjin Shanghai has introduced more than measures introduced by the government as the third engine of growth for China a dozen new policies to stimulate its in end-2007, poor market sentiments will boost investments and housing property market. These include tax following the Sichuan earthquake in demand. rebates for house purchases and lifting May 2008 and the global economic the maximum mortgage loan ceiling to slowdown. Average residential prices for Good Growth Potential in RMB 800,000 from RMB 600,000 for downtown Chengdu, however, remained Wuxi’s Residential Market fi rst-time homebuyers. resilient, rising marginally by 2.3%. Even when property markets started to slow at the end of 2007 and into The government’s proactive stance to As in other cities, Chengdu has 2008, investment in the Wuxi real bolster the property market augurs well implemented measures to boost its estate market remained strong, with for eventual market recovery. In the property market, including deferment of growth of 18.9% in 2008 while primary long term, Shanghai continues to be a land premium payment and providing housing prices increased 5.9%. As one strong market with sound fundamentals incentives to developers who can of the fastest-growing second-tier cities such as a huge population, rising commence construction work with in China, Wuxi’s housing market has household income and robust little delay. substantial growth potential, supported economic growth. by higher disposable income, better Looking ahead, continued efforts to job opportunities and increasing Long-Term Fundamentals for revitalise western China will help bolster foreign investment. Beijing’s Housing Market Chengdu’s housing market. Designated Remain Strong as a national experimental zone for Wuxi’s government has announced Due to homebuyers’ cautious sentiments, urban-rural reforms, coupled with an economic stimulus package of residential transaction volumes in Beijing infrastructural improvements with easy RMB 100 billion (US$14.6 billion). The fell 32.5%. However, prices remained access to major highways and rail lines, government also emphasised the resilient and increased by 11.9% in these reforms are expected to benefi t need for healthy property development 2008. As property developers began to the housing market in the medium- to and will reduce property transaction cut prices to stimulate sales, the market long-term. costs. The impact of these measures is showed signs of improvement. expected to fi lter through the economy Stimulus Measures to Bolster and improve sentiments in the In addition to the Central Government’s Tianjin’s Residential Market property market. stimulus package, the Beijing municipal Impacted by the global economic crisis, government has also implemented residential transaction volume fell by several measures for the property sector. 60–70% in the second half of 2008.

Keppel Land Limited 108 Report to Shareholders 2008 Shanghai continues to be a strong market with robust economic growth and rising household income.

Positive Outlook for Shenyang’s Zhongshan, a Competitive to allow developers to delay payment Housing Market Residential Market on land purchases made in 2008 for Total real estate investments in Shenyang With the transformation of Zhongshan as long as two years and to pay the rose 36.9% in 2008. However, transaction in Guangdong province into the leisure land appreciation tax in installments. volume dropped 14.5% due to subdued capital of southern China, the demand Taxes on home purchases will also be market conditions. Average housing prices for high-quality property developments reduced and restrictions on buyers in Shenyang increased by 1.6% in 2008. is likely to remain strong and is from Hong Kong, Macau and Taiwan expected to strengthen quickly upon the will be lifted. Shenyang’s government has announced recovery of the property market which several new policies to support the has been adversely affected by the Zhongshan continues to be a favourite property sector, including allowing global economic downturn. destination for Hong Kong residents who purchases of local residential housing are contemplating relocation on units with housing provident fund from Primary housing prices in Zhongshan retirement given its signifi cantly lower other provinces or cities and adjusting fell by 11.5% while transaction volume costs of living and property prices the defi nition of ‘ordinary housing’ by of residential housing fell by 53% compared to Hong Kong and the increasing the average selling price limit in 2008. The Guangdong provincial PRD region. from RMB 5,680 psm to RMB 6,700 psm. government, has announced plans Other policies to spur housing demand, support land acquisition and alleviate costs to property developers were also implemented. China 2007 2008E 2009F 2010F Residential prices are expected to remain Real GDP growth (%) 13.0 9.0 7.5 7.3 stable, underpinned by its high proportion Lending interest rate (average, %) 7.5 5.31 5.4 6.6 of end-users in the buyers’ mix. Together Inward FDI (US$ bn) 138.4 101.9 17.8 55.6 with rising affl uence and domestic Exchange rate (RMB/US$, average) 7.6 7.0 6.8 6.7 consumption, the real estate market in Personal disposable income (US$ bn) 1,418 1,739 1,887 2,110 Shenyang is expected to remain active. CPI change (average, %) 4.8 5.9 -0.2 2.5 Source: Economist Intelligence Unit, World Bank and People’s Bank of China

Operations and Market Review Overseas – China 109 Operations and Market Review Overseas – Vietnam

The sold-out Villa Riviera in Ho Chi Minh City is testament to Keppel Land’s reputed quality hallmark.

Residential Group’s position as the premier property The development is located close to Villas developer in Vietnam. schools, universities and the Saigon Ho Chi Minh City High-Tech Park where Intel’s US$1 billion Villa Riviera, District 2 Riviera Cove, District 9 test and assembly plant is under All 101 waterfront villas at Villa Riviera, Following the success of Villa Riviera, the construction. Major infrastructure works Keppel Land’s maiden residential project same concept is being developed on a such as Thu Thiem Bridge, East-West in Vietnam, were successfully handed larger 9.7-ha site located at the border Highway and Saigon River tunnel are over to buyers in 2008. between District 2 and District 9, close currently under construction and the to the Rach Chiec Sports Complex completion of these major infrastructure Located in the elite neighbourhood of and Keppel Land’s Saigon Sports City will shorten the travelling time to the An Phu Ward in District 2, Villa Riviera integrated development. CBD to less than 30 minutes, giving has now become the most desired home owners the privilege of living in residential address in Ho Chi Minh City Residents of the 96 resort-style villas a sanctuary within the city. (HCMC) and home to the afﬂ uent locals will enjoy a comprehensive range as well as the expatriate community. With of recreational facilities including a Condominiums a 250-metre frontage of the landmark clubhouse, swimming pool, tennis Ho Chi Minh City Saigon River, complemented by resort- court, children’s playground and 24- The Estella, District 2 style facilities, the gated compound hour security. A river promenade will be Launched in March 2008, The Estella is provides serenity and 24-hour security. constructed to allow residents to stroll a high-end condominium development The development also enjoys close along the 280-metre river frontage. set in a tropical ambience. proximity to international schools, hypermarket and other upcoming Villa Development, District 9 This 1,393-unit development occupies high-rise developments. Another gated villa development in a 47,906-sm site along Hanoi Highway the pipeline is located on a 13-ha site in the afﬂ uent An Phu Ward in District 2, In recognition of the quality of the and will yield 204 villas set amidst in close proximity to Villa Riviera. development, Villa Riviera received the 20- to 25-metre tall indigenous trees. The development has an approved prestigious Golden Dragon Award in It will be complemented with GFA of about 279,850 sm, including the construction quality category from a comprehensive range of facilities supporting commercial space. the Vietnam Ministry of Planning & and amenities including a private Investment and The Vietnam Economic clubhouse with state-of-the-art Phase One, comprising eight blocks Times in 2008. This is further testament gymnasium facilities, swimming pool, of apartments and exclusive facilities to Keppel Land’s hallmark quality and children’s interactive playground and such as a 50-metre swimming pool, brand name, and strengthened the tennis courts. clubhouse, tennis courts, 24-hour

Keppel Land Limited 110 Report to Shareholders 2008 security and supporting amenities, development to the city centre is a Located on a 68,442-sm site, the is under construction and is expected mere 10-minute drive. development offers a comprehensive to be completed in 2012. About 60% range of facilities including sky gardens, of the units from the initial release The development will offer quality lush tropical fl ora and 24-hour security. of 518 units have been sold as at lifestyle in a modern tropical setting. end-February 2009. There will be a comprehensive range of Riviera Point, District 7 amenities such as a clubhouse and a Comprising about 2,400 apartments, In line with Keppel Land’s philosophy fully-equipped gymnasium, swimming Riviera Point will offer luxurious of building sustainable and green pool and other water features, tennis waterfront living right next to the developments, The Estella became the courts, children’s playground and commercial centre of Phu My Hung, fi rst development in Vietnam to obtain 24-hour security. an established residential township. the Green Mark Gold Award from the Building and Construction Authority Waterfront Condominium, Located on a 85,118-sm site just a of Singapore. Binh Thanh District 15-minute drive to the city centre, This premier waterfront condominium Riviera Point enjoys a 500-metre Condominium Development, District 2 development offers the best view of both frontage of the Ca Cam River. It is Another waterfront condominium in the Saigon River and the city skyline. also within walking distance to four Keppel Land’s portfolio is a 51,043-sm international schools, the Royal site in District 2, adjacent to the 737-ha Set next to the meandering Saigon River, Melbourne Institute of Technology, Thu Thiem township. The development this 17,428-sm site is only 4 km away Franco-Vietnam Hospital as well as is expected to yield a potential GFA from the city centre and will offer 550 established commercial buildings and of 244,800 sm comprising 1,500 luxurious apartments complete with full restaurants in Phu My Hung. luxury apartments and supporting facilities and 24-hour security. commercial space. With GFA of 447,000 sm including Condominium Development, District 9 supporting commercial space, the The site enjoys direct access to the This 1,939-unit high-rise development development will feature residential East-West Highway which is currently is adjacent to Keppel Land’s villa towers above a podium, and infi nity under construction and will link District development in the same district. pools overlooking the river and the 2 to the city centre via the Saigon It enjoys the same surrounding commercial centre of Phu My Hung. River tunnel or the existing Thu Thiem infrastructure and proximity to A retail and food and beverage (F&B) Bridge. When the East-West Highway the universities, schools and the belt will be developed along the river is completed, travel time from this High-Tech Park. promenade, allowing for al’fresco dining.

Keppel Land raises the ante on luxurious waterfront living in Vietnam with premier waterfront developments like Riviera Point.

Operations and Market Review Overseas – Vietnam 111 Operations and Market Review Overseas – Vietnam

Tamarind Park This 367-ha township with 2.7 million sm This proposed 20-storey building, located GFA will be developed to meet the in the heart of the city, will offer 173 growing demand for well-planned and serviced apartments with all the modern quality homes among locals. The facilities for the most discerning residents. development will not only benefi t from the serene tropical waterfront environment Within walking distance from this but also the planned modern infrastructure development are the HCMC People’s such as the new international airport at Committee, the Dong Khoi shopping Long Thanh and a new highway linking belt, the Opera House and the Ben Long Thanh to HCMC. Thanh Market, HCMC’s central market. With the opening of the new highway, Townships the current travel time of 45 minutes To meet the rising home-ownership to the city centre will be signifi cantly aspirations of the Vietnamese and create shortened. a sustainable development based on the concept of live-work-and-play, Keppel Land holds a 50% interest in Keppel Land has embarked on two the project and will jointly develop the township projects in HCMC township with two local partners. and Dong Nai Province. Commercial Ho Chi Minh City Ho Chi Minh City Saigon Sports City Saigon Centre Saigon Sports City is Keppel Land’s Keppel Land is developing Saigon Centre, fi rst township development in Vietnam. a landmark mixed-use development This 64-ha site is conveniently located strategically located in HCMC’s CBD. in District 2 where major infrastructure Fronting Le Loi Boulevard, the city’s works are currently ongoing to further main thoroughfare, this prime 2-ha improve the connectivity between site is being developed in phases. District 2 and the city centre. The When fully completed, it will comprise proposed development will offer healthy international standard offi ce buildings, living concept with public sports facilities, premier serviced apartments and a including an Olympic-size swimming hotel inter-linked to a lifestyle retail mall. pool, tennis academy, football fi eld with grandstand seating, auditorium and Conferred the Medal of Labour Award a sports training hall. The remaining by H.E. President of Vietnam in 2008 for site will yield 3,000 apartment units and its contribution to the socio-economic supporting commercial space. growth of Vietnam, Saigon Centre remains the market leader in terms of Saigon Sports City is one of the fi rst 100% occupancy and rental rates in HCMC. foreign-owned township development licensed in Vietnam, which Keppel Land Phase One holds a 90% stake. Phase One of Saigon Centre comprises a three-storey retail podium, 11 levels Dong Nai of prime offi ce space, 89 units of Dong Nai Waterfront City serviced apartments and three levels Located at one bank of Dong Nai River, of basement car park. the natural boundary separating Dong Nai Province and HCMC, Dong Nai This landmark building in HCMC Waterfront City will boast a 1.5-km river has become the preferred address shoreline that offers unparallelled for diplomatic corps, multinational waterfront living options ranging from companies (MNCs), as well as banking townhouses and villas to high-rise and fi nancial institutions. apartments.

Keppel Land Limited 112 Report to Shareholders 2008 development between the users and the environment.

It is planned to be a landmark building that will place HCMC on the global map of iconic buildings.

Hanoi International Centre Within walking distance from the Hanoi Opera House and adjacent to the majestic Metropole Hotel, International Centre offers more than 7,000 sm of prime Grade A offi ce space. Located in the CBD and close to the scenic Hoan Kiem Lake, this eight-storey building is home to an international tenant profi le comprising MNCs, fi nancial institutions, legal fi rms, international airlines and blue-chip consultancy fi rms including Citibank, Freshfi elds, and Singapore Airlines.

Vung Tau Petro Vietnam Towers Petro Vietnam Towers, which is 12.9% owned by Keppel Land, is the only international standard offi ce building in the prime commercial district of Vung Tau. Completed in 1997, this 10-storey Grade-A offi ce building offers 12,465 sm of prime offi ce space and has a blue-chip tenant profi le comprising petrochemical, oil and gas companies and fi nancial institutions. Featuring state-of-the-art green technology, Phase Two of Saigon Centre will be a landmark development that will place Ho Chi Minh City on the global map for iconic buildings. Hotels and Resorts Hanoi Royal Park Sedona Suites Hanoi Its F&B outlets on the ground fl oor Dragon Award by Vietnam’s Ministry of Located just 15-minutes’ drive from the has become the meeting place for Planning and Investment and Vietnam city centre, on the northeastern bank of professionals as well as the young and Economic Times for excellent services. the serene Ho Tay Lake, Sedona Suites trendy, and the lifestyle retail at the podium Hanoi is the popular choice among levels have attracted tourists as well as Phase Two diplomatic corps, businessmen and the local and expatriate communities. Keppel Land and its local partners, the expatriate community. Set amidst SOWATCO and RESCO, are embarking sprawling lawns and lush landscaping, Tenants of the 10,433 sm of NLA of on plans for the subsequent phase of the development offers a tropical haven offi ce space include MNCs such as Saigon Centre. Skidmore, Owings and away from the hustle and bustle of Deutsche Bank, GE, Mitsubishi, AIG, Merrill (SOM), one of the world’s largest the city. Temasek Holdings, as well as Singapore and most infl uential architecture fi rms, Consulate General and US Commercial has been appointed to work on the The market leader in service quality Services. new concept plans. and acclaimed by the expatriate community as the most desired residential The choice accommodation among Phase Two of Saigon Centre is envisaged address, Royal Park Sedona Suites expatriates, Sedona Suites HCMC was to feature state-of-the-art green technology Hanoi enjoys near full occupancy for all conferred the prestigious 2008 Golden in building design, harmonising the 175 serviced apartments and villas.

Operations and Market Review Overseas – Vietnam 113 Operations and Market Review Overseas – Vietnam

Market Review

Economy Overseas Vietnamese remittance was Consequently, the occupancy rate of Challenges and US$8 billion, an increase of 19% Grade A space is expected to be around Opportunities Ahead compared with US$6.5 billion in 2007. 90% while rental rates will be in the range 2008 was a very challenging year for the of US$45 to US$55 psm pm in 2009. Vietnamese economy. The fi rst half of With a population of more than 86 million 2008 saw infl ation soaring, prompting people and GDP per capita exceeding Demand for offi ces has slowed down in the government to tighten credit growth US$1,000, coupled with its commitment Hanoi. This is due to a reduction in new and monetary policy. By the latter half of to the World Trade Organisation (WTO) business set-ups. As part of cost the year, there was a dramatic change to fully open its retail market in 2009, management, some companies in Hanoi in macro-economic policies due to Vietnam has been consistently ranked are expected to delay their plans for the global economic slowdown. The high in A.T. Kearney’s Annual List for expansion or relocate their offi ces government has changed its focus Emerging Opportunities for Global to outside the CBD area. Average from controlling infl ation to promoting Retailers, fourth in 2007 and fi rst in 2008. occupancy rate of Grade A offi ces in domestic growth. The State Bank of Hanoi was approximately 96%. As of Vietnam eased the prime interest rate from Vietnam’s 2008 exports were recorded end-2008, rental rates for Grade A as high as 14% to 7% in February 2009. at US$62.9 billion, up 29.5% from the offi ces ranged from US$30 to previous year. However, the country also US$55 psm pm. Vietnam’s economic growth moderated faced increasing trade defi cit which soared to 6.2% in 2008 from robust growth to US$17 billion. The government is Retail rates of above 8% in the preceding expected to adopt a fl exible US$/VND Good Prospects for Prime years. To pump-prime the economy, exchange rate policy to promote exports Retail Centres the Vietnamese government has and control defi cit in 2009. Demand for retail space in good locations announced a US$6 billion stimulus has increased in both Hanoi and HCMC package to achieve a GDP growth Despite the global recession, Vietnam due to limited supply. This will be further target of 6.5% for 2009. continued to be an attractive tourist exacerbated as Vietnam opens up its destination in 2008, hosting 4.25 million the retail market to foreign companies Committed foreign direct investment international arrivals, an increase of 0.6% in line with its commitments to the WTO (FDI) for 2008 was registered at an over 2007. A nationwide campaign was from January 2009. all-time high of US$64 billion, more launched in January 2009 to stimulate than three times the US$20.3 billion tourism in order to achieve the 2009 In HCMC, major retail centres and pledged in 2007, with actual disbursed target of welcoming 4.5 million visitors. department stores enjoy high occupancy capital up by 43.2% year-on-year to of above 95%, with average rents reach US$11.5 billion. Offi ce ranging from US$60 to US$80 psm Increasing Competition from pm. The new rich, rising consumer In 2008, international donors committed Lower Grade Buildings spending and greater sophistication in about US$5.43 billion in Offi cial By end-2008, rents for Grade A offi ces in lifestyle have encouraged more luxury Development Assistance (ODA) funds HCMC moderated to about US$60 psm brand companies to open their stores with US$2.2 billion being disbursed. pm from the peak of US$75 psm pm in Vietnam. Another US$5 billion of ODA funds have due to downsizing of some companies been pledged for Vietnam in 2009. The and expansion plans being held back Residential ODA funds have played an important by others. Despite limited new supply Speculators Out, Genuine role in Vietnam’s socio-economic of Grade A offi ces entering the market Buyers on the Sidelines development in building infrastructure from 2009 to 2010, the completion The residential market in 2008 was and improving living standards. of Grade B offi ce buildings has put signifi cantly impacted by the monetary pressure on the rental performance a n d fi s c a l p o l i c i e s . T h e fi r s t f e w m o n t h s of existing Grade A offi ce buildings. of 2008 saw strong take-up for new

Keppel Land Limited 114 Report to Shareholders 2008 developments launched. From March 2008 onwards, the market cooled as the State Bank of Vietnam increased the prime interest rate to 14%, pushing the lending rate to 21%, and controlled the credit growth to rein in the soaring inﬂ ation. Speculative buyers retreated from the market while the majority of the home-owners and investors are waiting at the sidelines for more attractive borrowing rates and prices.

Most second-tier local developers have put their developments on hold while state-owned, large private local developers and foreign developers continued to proceed with their developments. The secondary market witnessed a considerable drop in transacted prices of about 30% to 40% from the peak. However, prices of well- located projects continued to hold.

With the government’s shift from controlling inﬂ ation to promoting growth at the end of 2008, the prime interest With a young, vibrant population supported by increasing disposable income and liberalised laws rate was reduced to 8.5% in December allowing foreign homeownership, demand for quality homes in Vietnam will remain strong. 2008 and further reduced to 7% in February 2009. As credit control eases, most banks are beginning to offer home Demand for Grade A Serviced near term due to limited supply of loans with lower lending rates and longer Apartments Holds Grade A serviced apartments. tenures of 10 to 20 years to selective Grade A serviced apartments in both purchasers. HCMC and Hanoi enjoyed near full In 2008, rentals ranged from US$35 to occupancy in 2008 and the vacancy US$40 psm pm in HCMC and US$30 With a young population where about rate is expected to remain low in the to US$35 psm pm in Hanoi. Rents are 65% of the population are of working forecast to hold in the short term. age, supported by increasing disposable income and home-ownership Vietnam aspirations, demand for quality homes remains strong, especially in HCMC 2007 2008E 2009F 2010F and Hanoi. The Housing Law has been Real GDP growth (%) 8.5 6.2 6.5 1.1 further liberalised to allow foreigners Prime rate (average, %) 11.2 15.5 12.6 10.0 with valid working permits of at least Inward FDI (US$ bn) 6.7 7.6 2.2 2.95 one year in Vietnam to purchase Exchange rate (Dong/US$, average) 13,674 15,772 19,250 20,520 apartments under their own names. Personal disposable income (US$ bn) 33.2 42.3 37.9 36.3 CPI change (average, %) 8.9 24.4 4.3 3.3

Source: Economist Intelligence Unit and Government announcements

Operations and Market Review Overseas – Vietnam 115 Operations and Market Review Overseas – India

Residential consisting of 944 units is 88% completed over 15 tower blocks of 20 storeys, Condominiums and handing over of the units to the 1,138-unit development comprises Bangalore homeowners has started. Construction 2- to 4-bedroom units ranging from Elita Promenade of Phase Two, which consists of 629 units, 1,255 to 2,880 sf. Elita Promenade, which marks Keppel is 55% completed. As at end-February Land’s successful foray into India’s 2009, about 85% of the 1,457 units Kolkata residential market, is situated in JP Nagar, launched have been sold. Elita Garden Vista an established residential enclave. Elita Garden Vista is a 1,278-unit Elita Horizon development located within the Fronting Puttenahalli Lake, the Elita Horizon is Keppel Land’s second 3,780-ha Rajarhat Township, which is development is half an hour’s drive residential project in the Silicon Valley situated within Salt Lake City where much from the central business district and of India. Located off Kanakapura Road of the business activities is fuelled by IT is close to Bangalore’s IT hubs such as and close to the Peripheral Ring Road, growth conglomerates in West Bengal. the Electronic City and the IT corridor the development enjoys easy accessibility The Rajarhat Township is close to the lining Bannerghatta Road and Sarjapur to the major IT corridors of Electronic City international airport and a 30-minute Road. Its proximity to the Outer Ring and Bannerghatta Road. drive to Kolkata’s city centre. Road enables easy accessibility to all parts of Bangalore. Situated on elevated ground, the To be developed in two phases, development has unobstructed Elita Garden Vista comprises mainly The 1,573-unit development comprises views overlooking the picturesque 2- and 3-bedroom units, ranging from 17 tower blocks of 20 storeys, offering surroundings and offers a resort-like 1,277 to 1,850 sf in size. As at end- mainly 2- and 3-bedroom units ranging abode for homeowners amidst the hustle February 2009, about 59% of the from 1,162 to 1,790 sf. Phase One and bustle of south Bangalore. Spreading 616 units launched under Phase One have been sold.

Following its successful foray into India’s residential market, Keppel Land has made further in-roads with Elita Horizon and Elita Garden Vista.

Keppel Land Limited 116 Report to Shareholders 2008 Market Review

Economy trends with rising per capita income deferred payment schemes to Moderation in Growth Despite in key cities. entice homebuyers. Stimulus Plans After growing by 9% or more over the India’s central bank has also Property prices are poised to decline past three years, India’s economy is implemented several measures to ease further. However, the price correction and expected to expand by 7.1% in the year the credit crunch and mitigate the impact the downward trend in interest rates ending March 2009, the slowest growth of the global fi nancial crisis on the property are expected to bring back affordability in six years, as the global economic sector. It has eased restrictions on and boost housing demand from end- downturn and high borrowing costs lending to the property sector and users, especially from the IT/IT-enabled dampen external and domestic demand reduced the risk weightage on loans services segment in the medium to from manufactured products and cars from 150% to 100%. Banks are also long term. to new homes. given a window period of up to 30 June 2009 to restructure loans More Steady Growth for Kolkata The Indian government has announced to developers and treat them as Kolkata is also experiencing a slowdown two fi scal stimulus packages to stimulate standard assets. Other policy changes in housing demand, primarily due to the economy. India’s central bank has include the directive for banks to lower the global fi nancial crisis and domestic also eased monetary policies to enhance mortgage rates, allowing property factors such as a weak equity market, liquidity. The benchmark repo rate has companies to raise funds through short- tight credit situation and job security been cut from 9% in July 2008 to 5% term overseas borrowings and a 4% concerns. Prospective homebuyers in March 2009. The cash reserve ratio reduction in excise duty on construction are delaying purchases as they expect has also been reduced from 9% in materials such as steel and cement. property prices to correct and interest August to 5% in March. Infl ation has rates to fall further. Residential property also slowed from 12.63% in August Short-Term Weakness sales, which have been increasing to 3.36% in January 2009. As much in Bangalore at about 30 to 40% in 2007, have of its growth comes from domestic Bangalore has experienced a gradual declined by 10 to 15% in 2008. consumption, India is expected to slowdown in residential sales transactions recover at a faster pace than other and a softening in prices in 2008. Nevertheless, supply-demand emerging economies. According to Cushman & Wakefi eld, dynamics for upper-middle income residential prices fell by an average 10% residential apartments in Kolkata Residential across both high-end and mid-range remain relatively balanced. Market Market Fundamentals projects in most micro-markets in the watchers expect the residential market Remain Positive second half of the year. As transaction to continue to grow at a conservative India’s residential market is witnessing volume turned sluggish, developers slow pace in the next one to two years a slowdown in demand and a correction have resorted to offering discounts and growth will likely come from the in prices as high interest rates and job and incentive schemes such as middle-income segment. concerns saw potential buyers adopting a wait-and-see attitude. Further price weakness in the short term is expected India* until market conditions and consumer 2007 2008E 2009F 2010F confi dence improve. Real GDP growth (%) 9.0 7.1 5.0 6.4 Lending rate (average, %) 13.1 12.9 10.5 10.7 However, mid- to long-term demand Inward FDI (US$ bn) 24.1 39.7 30.0 35.0 fundamentals remain encouraging due Exchange rate (Rs/US$, average) 41.3 43.5 50.4 49.6 to an estimated shortage of 25 million Personal disposable income (US$ bn) 742.4 879.1 841.5 931.4 homes in urban India to meet latent CPI change (average, %) 6.4 8.3 4.5 4.4 demand and favourable demographic Source: Economist Intelligence Unit and Central Statistical Organisation * Figures refer to fi scal year commencing from 1 April of year indicated.

Operations and Market Review Overseas – India 117 Operations and Market Review Overseas – Indonesia

Residential Four clusters of landed houses with The main tower (Tower 1) of Wisma Condominiums a total of 989 units and a modern BCA will undergo refurbishment Jakarta township clubhouse with various works in 2009 to improve the Pasadenia Garden recreational facilities will be developed building’s effi ciency and maintain Pasadenia Garden is a low-density in the fi rst phase. its competitiveness. condominium development located within the upper-middle class Pulomas As at end-February 2009, about 45% Retail residential estate. The initial phase of of the 415 units launched in Phase One Surabaya 197 units has been completed. Some have been sold. BG Junction 97% have been sold with the remaining BG Junction is a strata-titled retail four units being leased out. The balance Phase Two, which will comprise complex comprising shop and anchor of 50 units were leased, with an achieved approximately 426 larger units of landed space. Situated within Surabaya’s CBD, occupancy rate of 70% as at end- homes ranging from 180 to 280 sm, is it consists of six levels of retail space, February 2008. scheduled to be launched in 2011. an adjoining multi-storey car park building and supporting facilities. Its Townships Commercial main anchor tenants are hypermart Jakarta Offi ce giant Carrefour and Cahaya Jakarta Garden City Jakarta Departmental Store. Jakarta Garden City is a 270-ha Wisma BCA integrated township development in Wisma BCA is situated in Jakarta’s CBD As at end-February 2008, the mall Cakung, East Jakarta and is located and within close proximity to hotels, achieved an overall occupancy rate of close to Kelapa Gading, an embassies, shopping malls and other more than 80%. A total of 379 units had established township. prime offi ce buildings. The two towers been sold and about 27,452 sm of retail enjoy an average occupancy rate space had been leased to major tenants. The entire township will be developed in of more than 90% in 2008, which is phases over 10 to 15 years, yielding about higher than the market average of 86% 7,000 landed homes and apartments. for offi ce buildings within the CBD. Retail malls, shophouses, entertainment Anchor tenant Bank BCA has relocated centres, offi ces, international schools and and Barclays Bank has signed up as the other facilities will also be built. new anchor tenant.

Envisioned to be an integrated live-work-and-play large-scale green township, Jakarta Garden City will feature tree-lined boulevards, communal parks and gardens.

Keppel Land Limited 118 Report to Shareholders 2008 Market Review

Economy Average occupancy rate of CBD offi ce Demand for Township Homes Positive Macroeconomic Indicators space increased from 85.2% in 2007 to Expected to Pick Up but Slowdown Expected 87.1% in 2008. In US$ terms, average As at end-2008, the total planned The Indonesian economy grew at 6.1% in rental decreased by 11% to US$13.07 area of selected residential estates 2008. Indonesia’s economy is expected psm pm in the last quarter of 2008, within the Greater Jakarta areas to grow by 4% in 2009. Investment and compared to US$14.78 psm pm in the (Jakarta, Tangerang, Bogor, Bekasi) is domestic consumption are expected previous quarter. approximately 41,188 ha, of which 38% to be the main growth drivers in 2009. have been developed, resulting in a Riding on improved business supply of 337,858 units. The cumulative Indonesia’s infl ation eased to 8.6% in environment, demand for quality offi ce sales rate of Greater Jakarta residential February 2009. Its central bank, Bank space is expected to remain stable in estates has increased slightly to 83% Indonesia cut the benchmark interest 2009. However, with the onset of the from 81% a year ago. In Jakarta alone, rate to 7.75% in March 2009. The decline global economic slowdown, the offi ce 57,631 units are available for sale, with in interest rates helps to boost bank market is expected to soften as most sales rate of 86% at end-2008. lending and spur investment and investors will review developments and consumption growth. wait for positive signs of recovery. Sales of residential estates are expected to pick up in the fourth quarter of 2009 The government has announced Residential after the July presidential election and in plans in January 2009 to spend about Homebuyers Defer Purchases anticipation of lower mortgage rates as US$6.5 billion (Rupiah 72 trillion) on Due to Market Uncertainties the central bank continues to reduce infrastructure and other projects in order Cumulative supply of Jakarta key interest rates to boost domestic to boost growth and create more jobs. condominiums as at end-2008 was consumption. Investment grew by 15.5% in 2008 and 67,377 units. Take-up rate averaged is expected to further grow by 11% in at 73%. Approximately 17,074 units Retail 2009 due to the government’s fi scal remained unsold at end-2008. Increasing Competition in stimulus package. Retail Market As the economy has started to slow down Two more shopping centres were opened Offi ce by the end of the third quarter of 2008, in 2008, bringing the total cumulative retail Offi ce Sector to Soften till sales activity has been affected with space in Surabaya to 863,000 sm Market Recovers buyers deferring purchase as they review at end-2008. Another two malls are Total stock in Jakarta CBD rental offi ce developments on interest rates and expected to open in 2009. market was 3.7 million sm in 2008 and economic indicators. Market absorption new supply of 324,800 sm is expected to rate for new projects is expected to Due to the global fi nancial crisis, decline enter the market at end-2009. About 93% slow in 2009. in export demand and increase in of the future supply are Grade A offi ce business costs are expected to affect buildings. Total net take-up at end-2008 the retail sector. reached 311,860 sm.

Indonesia 2007 2008E 2009F 2010F Real GDP growth (%) 6.3 6.1 4.0 2.2 Lending interest rate (average, %) 13.9 13.7 14.4 12.9 Inward FDI (US$ bn) 6.9 3.5 0.04 0.4 Exchange rate (Rupiah/US$, average) 9,141 9,734 12,066 12,150 Personal disposal income (US$ bn) 189.0 194.6 150.2 163.4 CPI change (average, %) 6.3 10.3 5.5 6.5

Source: Economist Intelligence Unit and Bank Indonesia

Operations and Market Review Overseas – Indonesia 119 Operations and Market Review Overseas – Saudi Arabia

Residential The development will comprise 993 Easily accessible via main roads, the Condominiums luxurious waterfront apartments with site is just a 15-minute drive from the Jeddah most of the units facing the Red Sea. King Abdulaziz International Airport and Luxury Residential Development The Jeddah Corniche area has been a 10-minute drive from the luxury retail along Jeddah Corniche touted as a popular high-end residential belt, Tahlia Street. Keppel Land has unveiled the design of precinct which has seen several new its landmark 320-metre twin towers at and exciting developments emerging. the 3.6-ha site along the Corniche in Jeddah, which it is jointly developing with The popular precinct also features the Saudi Economic and Development international hotels such as the Westin, Co. (SEDCO). Hilton and Sheraton, and established food and beverage outlets.

The landmark 320-metre twin towers in Jeddah will enjoy unparalleled, unobstructed sea views along the Corniche waterfront.

Keppel Land Limited 120 Report to Shareholders 2008 Market Review

Economy In light of the global recession, the Saudi among the lowest compared to other Expansionary Budget Arabian government has announced Gulf Cooperation Council (GCC) countries. Supported by Record Oil a SR 475 billion (US$126.7 billion) As supply still lags demand, it is not Surplus to Spur Growth expansionary and economic stimulus likely to experience the same price The Saudi economy has shown great budget for 2009. Saudi Arabia is also declines seen in other GCC countries, resilience and registered continued expected to be more than able to fund such as United Arab Emirates. The growth in 2008, despite the challenging its budget defi cit from past surpluses expected introduction of a mortgage external environment. Huge surpluses despite expectations that oil prices will law will further add impetus to the generated from the price increases in remain low over the short term. growth of housing demand. oil during the fi rst three quarters of the year helped buffer the impact of the Residential With the changing urban landscape and global economic crisis. With oil dominating Local Housing Demand the increasing residential development much of the total revenue, the Finance Backed by Urbanisation by developers, the building authorities Ministry expects to make a record and Population Growth have begun implementing a series of surplus of SR 590 billion (US$157 billion) Saudi Arabia’s continued economic new policies similar to those in Dubai for 2008 with total revenue projected growth, sizeable population and rapid and other rapidly developing cities. at SR 1.1 trillion (US$293 billion) urbanisation are key factors driving its Development parameters are being and expenditures at SR 510 billion real estate market. Its population, which defi ned, project payments controlled (US$136 billion). is estimated at 27.6 million, continues and new measures put in place to to grow at a rate of 2.3%. Expansion of improve processes and procedures. GDP grew by 4.2% reaching SR 1.74 existing cities and development of six These are expected to benefi t the trillion (US$463 billion) in 2008, compared new economic cities as well as greater industry in the long run. An important to 3.4% in the year before. The private infrastructure spending will increase factor is the willingness on the part of and public sectors grew by 8% and accessibility and spur new areas for the authorities to make bold changes 3% respectively, with the former development. The current shortfall in and accept new ideas that will eventually contributing about 46% to the GDP. affordable housing is estimated to be as improve clarity and effi ciency. Growth in the non-oil industrial sector high as 500,000 dwelling units and is set is estimated at 5.4% whereas the to increase within the next three years. In the recent Real Estate Transparency growth in the construction and building Survey done by Jones Lang LaSalle, sector is about 4.1%. Despite having escalated by about Saudi Arabia registered one of the 20% per annum in the last fi ve years, biggest improvements between 2006 According to preliminary estimates of residential prices in Jeddah are still and 2008, ranking 6th globally. the Saudi Arabian Monetary Authority, trade surplus of SR 820.2 billion (US$218.7 billion) is expected for 2008, an increase of 45.8% from the previous year. Current account balance of payment is expected to post a surplus of SR 564.8 billion (US$150.6 billion) for Saudi Arabia the fi scal year 2008 compared with 2007 2008E 2009F 2010F SR 354.3 billion (US$94.5 billion) in Real GDP growth (%) 3.4 4.2 0.4 3.3 2007, an increase of 59.4%. Infl ation Lending rate (average, %) 8.8 6.7 4.8 5.0 reached an estimated 9.5%. Inward FDI (US$ bn) 24.3 25.5 15.3 15.6 Exchange rate (Saudi Riyal/US$, average) 3.748 3.750 3.750 3.750 Personal disposable income (US$ bn) 112.9 130.0 131.9 138.7 CPI change (average, %) 4.1 9.9 1.3 3.0

Source: Economist Intelligence Unit

Operations and Market Review Overseas – Saudi Arabia 121 Operations and Market Review Overseas – Philippines

Palmdale Heights is one of Keppel Land’s good class residential developments in the Philippines.

Keppel Philippines Properties, which is and fourth phases comprising eight Benguet Centre, a six-storey offi ce 51% owned by Keppel Land, currently residential blocks with 1,264 units building located on the site, continues has two development projects in Metro will be launched when market to enjoy full occupancy. Manila – Palmdale Heights and conditions improve. SM-KL Towers. Townships Mixed Development San Jose del Monte City Residential Mandaluyong City Metro North Township Condominiums SM-KL Towers Metro North Township is a master- Pasig City SM-KL Towers is a mixed-use planned township development which Palmdale Heights development comprising retail, offi ce will integrate urban living with the natural Palmdale Heights is a middle-income and residential components. It is surroundings. The development will residential development situated on located on a 2-ha site in the heart comprise residential, commercial, a 7.6-ha site in Pasig City. The phased of the Ortigas CBD and is jointly institutional and mixed-use components. development offers a quality condominium developed with the SM Group in It is located on a 600-ha site in San Jose living environment with easy access to the Philippines. del Monte City in Bulacan, to the north Ortigas and Makati central business of Quezon City. districts (CBD). When completed, it will The Podium, which is the fi rst phase of comprise 29 residential blocks of 10 the retail component, has consistently Subject to favourable market conditions, storeys each with a total of 4,000 units. achieved an average occupancy rate a pilot project may be developed as the of about 95%. The Podium offers over fi rst phase of the development. The fi rst two phases of the development 150 specialty stores, restaurants and have been completed and comprise a service shops, making it one of the total of six blocks with 828 units. More preferred lifestyle malls in the city. It than 90% of the 828 units have been also provides a good venue for holding sold as at end-February 2009. The third corporate meetings and gala events.

Keppel Land Limited 122 Report to Shareholders 2008 Market Review

Economy Vacancy rates remained relatively steady Grade A offi ce rents in Makati are Modest Growth in 2008 with some 840 units and 300 units vacant expected to decline by 12% to 15% The Philippine economy grew by 4.6% in Makati and Ortigas respectively, in 2009. Rental rates in Fort Bonifacio in 2008, the slowest growth in seven while about 800 units are vacant in were down 13% to Php 650 psm pm years. Gross National Product expanded Fort Bonifacio. Occupancy rates are while capital values remained steady by 6.1% during the year due to a expected to decline in 2009 due to new at Php 100,000 psm. 13.7% increase in remittances from supply of about 3,700 units in the three Overseas Filipino Workers (OFWs) of prime areas. The business process outsourcing (BPO) US$16.4 billion. Infl ation eased to 7.3% industry is expected to slow down in in February 2009 from a peak of 12.4% Capital values in Makati and Ortigas 2009 due to the global recession. in August 2008. Lower infl ation will help grew by 7% and 6% respectively to Nevertheless, the Philippines remains to spur consumption. Php 102,000 psm and Php 59,000 psm, one of the most favoured BPO while capital values in Fort Bonifacio rose destinations in the world due to its Steady overseas remittances, rising by 10% to an average of Php 102,000 psm. cost-competitiveness and quality revenues from the services sector and human capital. increased government spending on Offi ce infrastructure will help cushion the Rents to Soften Further Retail impact of the global economic crisis. With the completion of a few offi ce Increased Expansion and The government has earmarked a developments during the year, the Enhancement Activities Php 330 billion (US$7 billion) economic offi ce stock in Makati and Ortigas CBD Given the strength of consumer resilience plan to pump-prime the increased to 2.7 million sm and 1.1 million demand, buoyed by remittances from economy and to create jobs. The central sm respectively in 2008, compared OFWs, expansion and renovation of bank has also reduced interest rates with 2.6 million sm and 1 million sm malls are rampant as they seek to respectively in the previous year. remain competitive. by 1.25% since mid-December 2008 Available rental space in Makati and to ease credit and stimulate economic Ortigas increased to about 81,000 sm Supply of retail space in Metro Manila activity. With these government measures and 54,000 sm respectively, as some increased marginally to about 4.7 million to sustain the economy, GDP growth tenants relocated their offi ces to lower- sm in 2008. Retail vacancy remained for 2009 is expected to range between cost locations and newer buildings in at 15% and is expected to increase in 3.7% and 4.4%. emerging districts like Fort Bonifacio. 2009 due to additional retail space. Effective rental rates in Makati and Residential Rental rates in Makati decreased by Ortigas declined by 2% and 10% Stable Demand for Prime 7% to Php 1,060 psm pm while to about Php 1,235 psm pm and Condominiums capital values went down by 6% to Php 1,000 psm pm respectively. Demand for condominiums in the prime Php 111,000 psm. In Ortigas, rental However, rents are expected to remain areas of Makati, Ortigas and Fort rates and capital values in prime areas stable in 2009. Bonifacio, is expected to remain stable, declined by 5% to Php 470 psm pm supported by the current low interest and Php 56,500 psm respectively. rate environment and competitive real estate mortgages. Philippines Supply of condominiums in the Makati 2007 2008E 2009F 2010F and Ortigas CBD increased slightly to Real GDP growth (%) 7.2 4.6 3.7–4.4 1.6 12,000 units and 6,000 units respectively Lending rate (average,%) 8.7 8.8 8.5 8.9 in 2008. Fort Bonifacio, an emerging Inward FDI (US$ bn) 2.9 4.5 0.2 0.2 district, is expected to increase its total Exchange rate (Php/US$, average) 46.1 44.5 47.7 49.0 supply to about 21,000 units by 2012. Personal disposable income (US$ bn) 64.3 74.3 62.9 61.5 CPI change (average, %) 2.8 9.3 2.5–4.5 3.5–5.5

Source: Economist Intelligence Unit, Bangko Sentral ng Pilipinas and National Economic Development Authority

Operations and Market Review Overseas – Philippines 123 Operations and Market Review Overseas – Thailand

Keppel Thai Properties (KTP), a subsidiary company listed on the Stock Exchange of Thailand, is developing two landed housing developments in Bangkok under the Villa Arcadia brand.

KTP will continue to focus on developing mid-to-high-end residential properties, and seek to diversify into Bangkok’s condominium sector on an opportunistic basis.

Residential Villas Bangkok Villa Arcadia at Srinakarin Villa Arcadia at Srinakarin is a 367-unit Keppel Land’s villa developments in Thailand carry the premium of the Arcadia brand, synonymous detached housing development at with quality. Srinakarin Road, about 17-km from the CBD. The modern tropical development provides resort-like Villa Arcadia at Watcharapol full amenities including swimming ambience amidst lush landscaping, Villa Arcadia at Watcharapol comprises pools, a clubhouse and a ﬁ tness centre. complete with full facilities. Phase One, 270 bungalows at Watcharapol Road, Phase One, comprising 40 units, has comprising 211 units, is about 63% sold about 20-km north from the CBD. been launched and 25% have been as at end-February 2009. Located within a burgeoning suburban sold as at end-February 2009. neighbourhood, the development has

Market Review

Economy Residential homebuyers to deduct up to Economic Stimulus Package Tax Incentives Introduced to Baht 300,000 from their taxable Aimed at Boosting the Economy Encourage Home Purchases income based on the purchase price Thailand’s GDP growth slowed to 3.4% In January 2009, the cabinet approved for the house. These moves are in 2008, as the economy was hit by a new property tax measure, aimed expected to raise the affordability declining exports due to the global at stimulating the property market of residential homes and improve recession as well as domestic political and other related industries such as market sentiments. turmoil, which affected the tourist industry. construction. These include allowing

The economy is expected to experience fl at growth in 2009. The government has introduced an economic stimulus package aimed at stimulating domestic consumption and sustaining economic Thailand growth. Some Baht 116.7 billion (US$3.4 billion) will be injected into the 2007 2008E 2009F 2010F system, while expanding tax credits Real GDP growth (%) 4.9 3.4 -1.0 1.8 and providing cash handouts to low- Prime rate (average, %) 7.1 7.1 6.6 6.8 income earners. It will also set aside Inward FDI (US$ bn) 9.5 8.1 2.0 2.4 Baht 270 billion as a contingency fund Exchange rate (Baht/US$, average) 34.5 33.3 36.5 37.1 to help state enterprises and fi nance Personal disposable income (US$ bn) 120.8 135.8 120.4 123.3 new stimulus programmes for the new CPI change (average, %) 2.2 5.5 -1.2 2.7 fi scal year starting October 2009. Source: Economist Intelligence Unit

Keppel Land Limited 124 Report to Shareholders 2008 Operations and Market Review Overseas – Malaysia

Residential Townships Market Review Johor Taman Sutera and Sutera Utama Located close to the city centre of Johor Bahru, Taman Sutera and Sutera Utama is a 487-ha integrated township with over 12,000 units of residential and commercial properties. As at Economy in the face of increasing housing supply end-February 2009, 87% of the 2,687 Stimulus Package to and concerns over the economic impact. launched units comprising terraced Pump-Prime Economy houses, semi-detached houses, Malaysia’s economy grew by 4.6% in As part of the economic stimulus apartments and shop offi ces have 2008, below the original forecast of 6.3%, package introduced in November 2008, been sold. amidst the global economic slowdown. measures have been taken to provide a As exports shrink and commodity boost for the fl agging construction sector. The township is characterised by prices like fuel and palm oil continue to About 60% or US$1.1 billion (RM4 billion) its strong community programmes fall, 2009’s growth forecast has been have been earmarked for construction to encourage community living. adjusted to negative 1% to 1%. projects related to affordable housing, Various social activities such as schools, hospitals, public transportation gotong-royong, pot-luck gatherings, To pump-prime the economy, the and roads. The government will also be get-together night, park beautifi cation Malaysian government announced spending more to build low-cost houses. day and charity dinner are organised a RM7 billion (US$2 billion) stimulus within the township to enhance package in November 2008. Aimed at Taking the responsibility of providing bonding amongst its residents. reinforcing the economy, strengthening affordable housing away from the national resilience and to maintain the private sector will provide a catalyst for The commercial centre at country’s economic growth momentum the industry, as private developers will Taman Sutera Utama includes a to face the increasingly challenging now be able to concentrate on their shopping mall and about 144 units of global economic climate, it included core business of supplying homes at shop offi ces. Sutera Mall, with gross measures to sustain consumer spending market-driven prices. fl oor area of 605,000 sf and total as well as stimulate private sector lettable area of about 357,000 sf, was confi dence. Measures taken to boost consumption opened in August 2008. The anchor and foreign investment may also benefi t tenant is Carrefour and the Mall has The government announced a second the property sector. These include the about 178 specialty shop tenants. stimulus package in March 2009. reduction of workers’ contribution to their Currently, the mall is 92% occupied. The RM60 billion (US$16 billion) will Employees Provident Fund from 11% The tenants are made up of local and be disbursed over a two-year period, to 8% for two years beginning in international retailers, selling both local focusing on reducing unemployment, January 2009. Foreigners who want and branded items. Its main target creating jobs, infrastructure spending to buy commercial real estate worth group is middle-income shoppers. and assisting the private sector. RM500,000 or more will also no longer Many of the shop offi ces located in the need the approval of the Foreign vicinity of Sutera Mall have also been Residential Investment Committee. occupied and due to the large number Market Sentiment Cautious of food and beverage outlets, it is The property market was affected in slowly turning into a food street. 2008 as buyers turned more cautious

Malaysia 2007 2008E 2009F 2010F Real GDP growth (%) 6.3 4.6 -1 to 1 1.9 Prime rate (average, %) 6.3 5.9 5.3 5.1 Inward FDI (US$ bn) 8.5 6.6 1.1 1.2 Exchange rate (RM/US$, average) 3.44 3.33 3.63 3.55 Personal disposable income (US$ bn) 87.1 96.3 85.1 87.9 CPI change (average, %) 2.0 5.4 -0.7 1.7

Source: Economist Intelligence Unit and Prime Minister’s Department - Economic Planning Unit

Operations and Market Review Overseas – Malaysia 125 Beijing Shenyang Regional Network Tianjin China Offi ce Jiangyin South Korea Japan 1. Ocean Financial Centre Changzhou 2. Ocean Towers Wuxi 3. Equity Plaza Shanghai 4. The HarbourFront Offi ce Park Chengdu 5. Prudential Tower+ Saudi Arabia 6. Keppel Towers and GE Tower+ Kunming 7. Bugis Junction Towers+ Guangdong Jeddah Myanmar 8. One Raffl es Quay+ India Hanoi Hong Kong Kolkata Residential Mandalay Vietnam 9. Nassim Woods Yangon Quezon City 10. Park Infi nia at Wee Nam Manila Bangkok 11. The Tresor Sattahip Dong Nai Philippines 12. The Sixth Avenue Residences Bangalore Ho Chi Minh City 13. Madison Residences Thailand Cebu Vung Tau 14. Keppel Bay Precinct* 15. The Promont Malaysia 16. The Suites at Central 17. Vision Crest Johor Baru Singapore Manado Batam Bintan Mixed Development 18. Marina Bay Financial Centre# Indonesia 19. Heritage Court 20. Joo Chiat Shophouses Jakarta Yogyakarta Surabaya Bali Industrial 21. Quartz Industrial Building 22. Orion Industrial Building

Data Centre 23. Keppel Digihub

Mass Rapid Transit Lines Property India Hotels/Serviced Apartments Expressway Elita Promenade, Bangalore China Elita Horizon, Bangalore Vietnam Park Avenue Precinct, Shanghai Elita Garden Vista, Kolkata Sedona Suites, Hanoi Villa Riviera, Shanghai Sedona Suites, HCMC * Includes Caribbean at Keppel Bay, Reﬂ ections Residential Development, Shanghai Indonesia at Keppel Bay, Marina at Keppel Bay and Ofﬁ ce Units, Shanghai^ Galleria Tunjungan, Surabaya Indonesia Keppel Bay Plots 3, 4 and 6 + The Botanica, Chengdu BG Junction, Surabaya Club Med Ria Bintan Assets owned by K-REIT Asia in which the Residential Township, Shenyang Jakarta Garden City, Jakarta Hotel Sedona Manado Group has a 44.1% stake # The Arcadia, Tianjin Pasadenia Garden, Jakarta Melia Purosani Hotel, Yogyakarta Includes Marina Bay Financial Centre Phases Tianjin Pearl Beach International Wisma BCA, Jakarta One and Two, Marina Bay Residences and Country Club, Tianjin^ Myanmar Marina Bay Suites Serenity Cove, Tianjin^ Saudi Arabia Sedona Hotel Yangon Mixed Developments, Tianjin^ Waterfront Residential Development, Sedona Hotel Mandalay Central Park City, Wuxi Jeddah Stamford City, Jiangyin Resorts Jiangyin Yangtze International Malaysia Country Club, Jiangyin^ Taman Sutera, Johor Baru China Summerville, Changzhou^ Spring City Golf & Lake Resort, Kunming Integrated Marina Lifestyle Development, Philippines^^^ Singapore Zhongshan SM-KL Towers, Metro Manila Indonesia Palmdale Heights, Metro Manila Ria Bintan Vietnam Metro North Township, Quezon City Nongsa Point Marina and Resort, Batam Saigon Centre, Ho Chi Minh City (HCMC) Site in Cebu Tanah Lot Resort, Bali 23 Saigon Sports City, HCMC Sampaguita Ville, Cebu The Estella, HCMC Riviera Point, HCMC Thailand^^ Waterfront Condominium, HCMC Jewellery Centre, Bangkok 21 Riviera Cove, HCMC Sukhaphiban 3 Mansion, Bangkok Condominium Development, HCMC Villa Arcadia at Srinakarin, Bangkok 22 Villa Development, HCMC Villa Arcadia at Watcharapol, Bangkok 13 Condominium Development, HCMC 12 20 Tamarind Park, HCMC 11 10 Waterfront Residential Township, 7 9 15 Dong Nai 16 International Centre, Hanoi 17 3 5 1 2 8 Petro Vietnam Towers, Vung Tau 19 6 18 4 14

^ Assets owned by Evergro Properties in which the Group has a 85.4% stake ^^ Assets owned by Keppel Thai Properties Co in which the Group has a 45.5% stake ^^^ Assets owned by Keppel Philippines Properties Inc. in which the Group has a 51% stake

Keppel Land Limited Operations and Market Review 126 Report to Shareholders 2008 Regional Network 127 Corporate Social Responsibility Safety and Health

Committed to create a safe and healthy workplace for everyone, Keppel Land actively engages its people, consultants and contractors to achieve its goal.

Safety is of paramount importance and reviews safety reports on the During construction, project managers at Keppel Land, with commitment Group’s operations in Singapore and oversee the engagement of contractors that extends from top management overseas on a monthly basis. and ensure that site safety procedures to all who set foot on the worksite. are strictly adhered to. Safety management, which is viewed Keppel Land adopts a structured as an integral and strategic aspect of and systematic approach to safety Management and operations meetings business, was formalised by way of a management. Identifi cation and begin and end with a safety message, comprehensive Company-wide Health control of risks start in the earliest and Company executives routinely visit and Safety (H&S) Management System. concept development stages of a worksites for a fi rst-hand perspective project and continue through design, and to propagate the safety message Comprehensive and Proactive construction and management. to all workers. Approach Wherever possible, risk is eliminated The Group has in place a Board or mitigated during the design phase. Going beyond statutory requirements, Safety Committee (BSC), affi rming In selecting contractors, Keppel Land Keppel Land commissions monthly the commitment of top management ensures high safety standards are third-party safety surveillance on to safety. The BSC guides the maintained by specifying minimum construction sites to verify contractors’ Management Safety Committee (MSC) acceptable H&S rules and procedures compliance with relevant regulatory in spearheading initiatives on safety its contractors need to comply with. and safe work practices. In 2008, the

Keppel Land’s top management demonstrates commitment and support through various safety and health initiatives.

Keppel Land Limited 128 Report to Shareholders 2008 Through safety training and education, Keppel Land builds up a strong base of employees with good health and safety knowledge across its overseas operations.

independent safety audit programme Grading System to identify contractors The Promont in Singapore, and for completed buildings was extended for signifi cant contribution towards Elita Garden Vista in Kolkata, India, to overseas projects, namely Saigon safety excellence was also introduced. to highlight and acknowledge the Centre in Ho Chi Minh City and This follows the H&S management commitment and participation of all International Centre in Hanoi, Vietnam system established in 2007 stipulating workers to achieve Keppel Land’s and Wisma BCA in Jakarta, Indonesia. the necessary requirements for its goal of a zero-harm workplace. contractors to comply with. Keppel Land H&S efforts focus on four As the Company aims for this ultimate main thrusts, namely communication, In May, a Workplace Safety and Health goal, it also recognises smaller but training, proactive actions and rewards Campaign was held at Refl ections at equally important successes along and recognition. Safety initiatives are Keppel Bay’s worksite to share safe work the way. A Safety Recognition Campaign planned throughout the year to ensure practices with workers and employees. for contractors was introduced where that workplace safety remains a top Workers, consultants, partners of the every hundred days or a hundred priority and top-of-mind issue. development as well as staff from thousand man-hours worked without Keppel Land and main contractor lost time injury would be recognised. Promoting Worksite Safety Woh Hup participated in the campaign. In April, Keppel Land organised its Participants signed a safety pledge to On 28 December, Refl ections at inaugural Consultants and Contractors make personal commitment to take Keppel Bay celebrated its one million Health and Safety Meeting to propagate workplace safety seriously. accident-free man-hours. A ceremony the safety message as well as to recognise was held at the Refl ections worksite to those who achieved exemplary workplace Similar worksite safety campaigns were commemorate the safety milestone. safety standards. A Worksite Safety also held at Ocean Financial Centre and

Corporate Social Responsibility Safety and Health 129 Corporate Social Responsibility Safety and Health

Embracing a Safety Culture Safety training and education have a Throughout the year, safety exhibitions Beyond encouraging safety practices positive impact on safety performance. were organised in several completed and habits, Keppel Land seeks to create Throughout the year, Keppel Land residential and ofﬁ ce developments a culture that embraces safety, both on continued to organise a series of training to educate homeowners and ofﬁ ce and off the worksite. workshops and seminars to build a occupants on potential safety issues strong base of employees with good at home and the workplace. Recognising that information and H&S knowledge to improve overall knowledge sharing are important for H&S standards at their workplaces. As a leading industry player and a maintaining and increasing safety proponent of higher safety standards, awareness, Keppel Land introduced in Keppel Land underscored further Keppel Land also worked closely with 2008, quarterly articles to disseminate commitment to safety with participation the Ministry of Manpower on its new research and information on safety in the Keppel Group-wide Safety guidelines on Design for Safety in issues. Authored by the in-house H&S Convention. Held annually, it is a Buildings and Structures Guidelines Manager, the articles cover topics platform for the various Keppel (previously known as Designing Out ranging from electrical safety to lifting business units to learn with and from Occupational Safety and Health Risk operations and are aimed at spreading each other about safety workplans to at Source or DO2RAS) which was the safety message amongst employees drive safety practices and messages launched in November 2008. at all levels. deep into work processes. Moving ahead, Keppel Land will As part of the ongoing efforts to engage The theme for 2008, “Safety Starts with continue to engage and work closely contractors on H&S awareness, Me”, aims to instill in every employee with its consultants and contractors to information-sharing sessions with a sense of personal and collective sustain the Group’s efforts to create contractors are held quarterly to highlight responsibility to ensure that everyone safer and healthier workplaces and explore operational safety issues. returns home safely at the end of each for everyone. At the end of the year, a review is work day. “Safety Starts with Me” is a conducted to evaluate the performance follow-up to the Keppel Group’s of every project and discuss suggestions adoption of the “Five Key Principles for improvement. for Safety” during its inaugural Safety Convention in 2007.

5 Key Principles for Safety

• If safety is expensive, disasters cost more

• Value everyone’s safety

• Zero tolerance for incidents

• Recognise safe behaviours

• Passion for health, safety and environmental excellence

Keppel Land Limited 130 Report to Shareholders 2008 Corporate Social Responsibility Environment

Keppel Land’s developments are designed to harmonise with the environment while enhancing lives.

Proactive Environmental International, attesting to its leadership, developments through its quality Management commitment, and high standards of overseas projects. Keppel Land is committed to develop environmental management. properties that harmonise with the Saigon Centre, a landmark mixed-use environment and enhance the quality Spring City Golf & Lake Resort in development strategically located in of life of the communities in which Kunming, China is also a member of the HCMC has been recognised as one of it operates. It has in place an Audubon Cooperative Sanctuary the most eco-friendly developments in Environment Management Committee Programme that helps organisations Vietnam, having been named the Most (EMC) to develop and implement and businesses protect the environment Energy Effi cient Building (1st Runner- strategies and programmes relating while enhancing their bottom line. Up) by Vietnam’s Ministry of Trade & to the environment. Industry. Subsequent phases of Saigon Award-Winning Eco Developments Centre, envisioned to be a world-class Keppel Land’s proactive approach During the year, Keppel Land was architectural landmark, will feature towards environmental management conferred four Green Mark Awards by state-of-the-art green technology in has earned the Company numerous the Building and Construction Authority building design. awards and certifi cations. In 2008, (BCA) including the highest Platinum Keppel Land obtained the ISO 14001 Award for Ocean Financial Centre (OFC), Keppel Land, as part of the Keppel Group, Environmental Management System and a Gold Award for The Estella in will be participating in the landmark certifi cation for the development of Ho Chi Minh City (HCMC), the fi rst Sino-Singapore Tianjin Eco-City project commercial and residential projects Green Mark Award in Vietnam. Also (Tianjin Eco-City). In addition to being an in Singapore. Works are currently awarded the Gold Award were Marina investor and member of the Singapore underway to expand the certifi cation Bay Financial Centre Phase One consortium, Keppel Land will be the scope to include property management (Commercial) and Refl ections at Project Manager in the property and overseas operations. Keppel Bay. development of a 30-ha site within the 4 sq km start-up area. Marina at Keppel Bay received the The BCA Green Mark Scheme is a Clean Marina Award from the Marina rating system used to evaluate a building Envisioned to be an ecological haven, Industries Association of Australia for for its environmental impact and the Tianjin Eco-City will serve as a model its professionalism and commitment performance in the areas of energy of sustainable development with homes to best practices of environmental effi ciency, water effi ciency, building for 350,000 residents spread across a management in the marina industry. development and management, total land area of 30 sq km in an eco- It is the fi rst and only marina in Asia indoor environmental quality and friendly environment that will feature the to be accredited to date under the environmental protection, as well preservation and restoration of natural voluntary programme. as innovation. ecology, energy-effi cient buildings, green consumption and low carbon emissions. In Indonesia, Ria Bintan became the Beyond Singapore, Keppel Land fi rst golf course in the country to attain demonstrates the same level of To underscore its fi rm commitment the “Certifi ed Audubon Cooperative commitment to the environment and towards the green building movement, Sanctuary” status by Audubon sets new benchmarks for sustainable Keppel Land sets as a benchmark

Corporate Social Responsibility Environment 131 Corporate Social Responsibility Environment

for all its projects in Singapore and 270-ha integrated lifestyle township high green plot ratio and an innovative overseas the goal to achieve the development in Cakung, east Jakarta. paper recycling chute for offi ces. BCA Green Mark Gold standard Boasting tree-lined boulevards, or its equivalent overseas, as the sculptured gardens and ample parks, Preserving Water, Energy and minimum standard. the Township offers a green haven for Ecological Resources families in a self-contained ‘live-work- Keppel Land adopts a proactive For more information on Keppel Land’s play’ environment amidst lush foliage. approach towards environmental Green Mark projects, please refer to management and aims to minimise pages 17, 19, 22 and 27 of Keppel Keppel Land’s offi ce buildings, developed environmental impact in planning, design Land’s Sustainability Report 2008. to house leading global businesses, are and construction by controlling its designed for maximum effi ciency and waste, preventing pollution and using Quality Live-Work-Play fl exibility. An array of resource-effi cient resources effi ciently. Environments features are incorporated including Environmental preservation and the devices optimising air-conditioning control Recognising the two-fold benefi t enhancement of community life are a and reducing energy consumption, energy- of environmentally-friendly business design and construction priority for effi cient light fi ttings, motion sensors practices on the environment and on its Keppel Land. Developments are carefully and recycling of condensate water. bottom line, Keppel Land embarked on crafted to harmonise with the urban an eco-offi ce programme to proliferate and natural landscape, combining OFC, the fi rst offi ce development in the importance of waste minimisation aesthetics and functionality to create Singapore’s central business district and resource conservation and to quality living and working spaces with to achieve the Platinum Green Mark cultivate environment ownership enduring value for the community. Award, will showcase state-of-the-art amongst its employees. green features such as Singapore’s Being at one with nature is the core largest solar panel system for offi ces, Recycling habits were encouraged with concept of Jakarta Garden City, a the fi rst hybrid chilled water system, a strategically-placed bins for paper, metal

Keppel Land promotes eco-awareness through education and outreach programmes amongst staff and tenants.

Keppel Land Limited 132 Report to Shareholders 2008 and plastic items along with posters put commemorating World Environment Year of the Reef and Clean and Green up to educate employees. To reduce Day and through sponsoring various Singapore – North West “Come Out electricity and water usage, conservation community activities. and Play, It’s No TV Day!” by the measures such as motion sensors in National Environment Agency (NEA). toilets, shutting down of some lifts after On 29 March 2008, Keppel Land’s offi ce hours and water-saving devices office buildings participated in Moving ahead, the Company will explore such as thimbles in taps are used. The Earth Hour, the highlight of a major a possible scheme to award and property management team also carries campaign to encourage businesses, evaluate its consultants based on their out regular maintenance and periodic communities and individuals to cut environmental performances. upgrading of facilities to ensure their emissions on an ongoing basis. effi cient operations which will minimise Delivering a powerful message about Building Green Capabilities electricity and water wastage. the need for action on global warming, Keppel Land believes in nurturing talents Keppel Land’s participation in Earth Hour and is committed to build up a core In December 2008, its efforts paid off posed a reminder to tenants and of in-house green building specialists when the Singapore Environment employees that simple steps like turning who possess the knowledge and skills Council awarded Keppel Land’s off lights and non-essential electrical to participate in design processes, corporate premises at Bugis Junction appliances can result in lower energy encourage integrated designs, and Towers, the Green Offi ce Certifi cation consumption and operating costs in enhance building performances. for the successful implementation of an the long run. eco-offi ce environment. To-date, it has successfully trained In June 2008, Keppel Land more than 20 project managers as Keppel Land has set an annual target commemorated World Environment Day green building specialists, including 24 of 3% reduction in paper and energy across its offices in Singapore and Green Mark Managers and one Green consumption at its corporate offi ce for overseas by organising a series of green Mark Professional. the next three years. initiatives and events to encourage staff and tenants to adopt green practices. The Group continues to keep abreast At Equity Plaza, the implementation These included hosting of talks, of green business strategies and of energy conservation and effi ciency exhibitions and screenings of the practices by participating in industry measures as part of its energy audit docu-fi lm An Inconvenient Truth as well conferences, trade shows and workshops exercise was completed in 2008 and as tree- and flower-planting activities. such as the International Green has achieved average monthly savings Building Conference presented by of about 14%. Following last year’s well-received BCA and the Corporate Environment efforts to get staff to use fewer plastic Champions Workshop by NEA. At Keppel Bay Tower, a roadshow on bags by distributing complimentary recycling was held at its lobby to kickstart Go Green with Keppel Land reusable Keppel Land also recently set up a a paper recycling programme for tenants. bags. Mugs were distributed this year green resource library offering a wide Keppel Bay Tower will be applying for to encourage staff to cut down on the selection of books, articles and DVDs the Green Mark Award in 2009 under use of styrofoam and plastic cups. As relating to the environment. Coupled the Existing Buildings scheme. an added incentive, Keppel Land also with the environment portal on the worked with retailers to offer discounts Company’s Intranet, employees are For more information on Keppel Land’s to staff who brought their own refi llable able to access and share resources environmental performance, please mugs to purchase beverages. on a wide range of research and refer to pages 24 to 26 of Keppel information including global warming, Land’s Sustainability Report 2008. Apart from its employees, Keppel Land carbon markets, green building helped to spread the green message to design and construction as well as Spreading the Green Message customers, consultants, contractors eco-lifestyles. In addition to going green in its and the general public. To achieve this, businesses, Keppel Land also the Company participated in exhibitions, endeavours to promote eco-awareness talks, conferences and roadshows and through environmental education sponsored Go Green with Keppel Land and outreach programmes. Over the reusable bags and mugs for various course of the year, the Group rolled community outreach activities such as out several initiatives and events Ricoh Asia Pacifi c’s Eco-Action event, towards cultivating a ‘green’ culture RSC Block Party: the Eco-Solutions including participating in Earth Hour, Festival, launch of the International

Corporate Social Responsibility Environment 133 Corporate Social Responsibility People Review

People development and talent management are core to Keppel Land’s future growth.

Keppel Land employs over 3,500 staff Attracting Talent from Around fulﬁ lling building career with one of Asia’s in 10 countries around the world. Its the World leading developers. The two scholarship all-inclusive people approach builds a In 2008, Keppel Land continued recipients this year will pursue their strong and diverse talent pool to lead to build its talent pipeline through degrees in Civil Engineering and Project the Group into future phases of growth. scholarships, internships and & Facilities Management respectively at graduate-training programmes. the National University of Singapore (NUS). Organisational programmes focus on building a passionate and competent In Singapore, Keppel Land partnered During the year, Keppel Land partnered team through identifying and developing the Building and Construction Authority NUS to offer internship opportunities talents, encouraging work-life balance (BCA) to offer the Keppel Land-BCA to seven undergraduates from the and instilling a strong culture of safety Built Environment Scholarship for the Department of Real Estate. The internship and excellence. ﬁ rst time. This scholarship is offered to programme allowed participants to promising undergraduates who are take on challenging and practical work keen to embark on a challenging and assignments, experience corporate

At exchange platforms such as the Annual International Conference, overseas staff share experience and are kept abreast of the Company’s developments.

Keppel Land Limited 134 Report to Shareholders 2008 life and gain better appreciation of the Motivating and Career planning has been formalised various exciting career options available Retaining Employees into the performance management within the Group. Keppel Land’s belief in the importance system in the form of an individual of its human capital is the main driver development plan which identifi es A Management Associate Programme behind a policy of consistent investment short- and long- term career goals was also launched, targeting new and in not just recruiting the right people, and the training and developmental recent Vietnamese graduates. Under but also in creating an environment activities needed to achieve them. In this scheme, selected candidates will and culture where employees feel addition, all employees receive annual undergo an intensive one-year training appreciated and rewarded. performance reviews where managers programme in Singapore and overseas, provide their staff with timely and clear where they will have the opportunity Recognising the link between performance feedback and jointly set to participate and work with different performance and reward, Keppel Land annual performance objectives. functional teams and be given on-the- subscribes to a pay-for-performance job training. philosophy. Compensation includes a Keppel Land provides its employees base salary commensurate with skills with training and development In line with the Group’s commitment to and experience, along with an opportunities in order to realise their develop talents, whether in Singapore incentive bonus programme based full potential so that they can contribute or overseas, Keppel Land presented on personal performance. effectively to the organisation. Apart internships to three outstanding young from development and enrichment talents from the Middle East under In boosting its competitiveness to programmes, inter-departmental rotations, the Keppel-Young Arab Leaders (YAL) attract and retain talent, Keppel Land secondments and overseas postings Internship Exchange Programme. reviewed its international assignment encourage professional development policy to establish competitive salary and growth, allowing employees to gain In India, Keppel Land piloted the positions aligned with market norms the skills and knowledge not necessarily Keppel Land-St Joseph’s Institution and practices. The Group also embarked available within their own workplace (SJI) Scholarship Programme, a two-year on a job evaluation (JE) exercise to while at the same time opening up new scholarship offered to talented Indian reassess pay and grading structures. career paths and opportunities. youths to pursue the International Baccalaureate diploma in Singapore. Staff engagement also took priority Refl ecting the Group’s people in the year of review with quarterly development focus, Keppel Land Both the YAL and SJI programmes offer management-staff interaction sessions continued to sponsor its staff for the overseas youths a unique immersion being introduced. These sessions Clipper Round the World Yacht Race, experience in an Asian working enable senior and top management to providing a life-transforming opportunity environment and culture while preparing interact with staff at various levels, to for exposure and self-development. them for their future career endeavours. build rapport and exchange perspectives At the same time, it is a platform for on work and other issues. Cross-Border Engagement Keppel Land to build up employer brand With a strong international footprint, equity and strengthen inter-country Talent Management Keppel Land believes in providing business relationships. and Development platforms for Group-wide talents Keppel Land has established a talent to come together to exchange To raise awareness of Keppel Land management and development experiences and knowledge. as a choice employer, Keppel Land framework to accelerate the growth and participated in the Built Environment development of future leaders. It has In line with the Company’s commitment Scholarship, Training and Career Fair in place a Talent Review Committee, to empower and engage its employees, cum BCA Academy Open House 2009, chaired by the Group Chief Executive the Annual Regional Conference (ARC) organised by the BCA. Offi cer and made up of the divisional was created as a strategic platform for CEOs, that oversees human capital management to share the Group’s Potential scholarship applicants and issues such as succession planning and thrusts and objectives with its staff job seekers visited Keppel Land’s talent development. The Leadership worldwide. The ARC was aptly renamed booth and mingled with Keppel Development Programme for Emerging Annual International Conference (AIC) scholars and Keppelites who shared Leaders has also been launched to in 2008 to refl ect the Company’s with them perspectives on working in accelerate the development of high increasingly diverse workforce and the Company. calibre executives to assume geographic spread. managerial positions.

Corporate Social Responsibility People Review 135 Corporate Social Responsibility People Review

At the AIC, senior management They were also equipped with business for its employees. In addition, staff are encouraged staff to achieve and skills in areas such as negotiation and encouraged to lead a well-balanced maintain high performance standards business development in intensive and healthy lifestyle through various and stressed the need to achieve small group sessions and enjoyed activities organised by the Staff Welfare safety and environmental objectives. networking with colleagues from the Committee including weekly badminton To foster sharing of best practices, the Group’s headquarters and the other clinics, regular talks on health education inaugural Work of a Winner (WOW!) overseas offi ces. and participation in the annual Keppel programme was launched. Teams Group Inter-SBU Games. ‘Love Life, representing their overseas offi ces In November, regional and city heads of Live Well’ was the theme of the Welfare presented case studies on innovative Keppel Land’s overseas offi ces convened Committee for 2008/2009, a timely problem solving methods and people in Singapore to attend the Annual Leaders’ reminder for staff to be mindful of their management skills. A panel of judges, Conference, a platform for information state of health and to achieve the right comprising senior representatives from exchange and strategic brainstorming balance between their professional and across the Group, and the audience across the Group’s overseas operations. personal lives. had to vote for their favourite team. Apart from sharing market insights, success stories and strategies, the For its achievements in championing Apart from the AIC in March, a few other conference also facilitated the alignment workplace health, Keppel Land was events were held in the course of the of the overseas units to the Company’s conferred the Singapore H.E.A.L.T.H year to share competencies and foster strategic directions. Award (Silver) by the Health Promotion learning of best practices. In October, Board for the third consecutive time about 100 overseas staff gathered in Promotion of Health in 2008. Singapore to participate in the inaugural and Well-Being International Exchange. The fi ve-day forum A fi rm believer in promoting employee For more details on Keppel Land’s provided participants with corporate health and wellness, Keppel Land people review, please refer to the updates and site visits to Keppel Land’s has over the years sponsored health People Review section in Keppel iconic developments in Singapore such screenings and granted complimentary Land’s Sustainability Report 2008 as Keppel Bay and One Raffl es Quay. usage of gymnasium and pool facilities on pages 34 to 39.

A balanced and healthy lifestyle is encouraged amongst staff.

Keppel Land Limited 136 Report to Shareholders 2008 Singapore HQ (at end-2008) Singapore HQ (at end-2007) International Manpower Breakdown of employees by Breakdown of employees by Distribution professional category professional category

Executive 77.5% Executive 75% Non-executive 22.5% Non-executive 25% Singapore 14.6% China 37.4% Indonesia 17.5% Thailand 1.8% Philippines 1.0% India 2.3% Vietnam 12.3% Myanmar 13.1%

Qualification of Management Qualification of Non-Executive Staff Training Expenditure Distribution and Executive Staff

Degree/Professional Certification 2.6% Masters Degree/ Post Graduate 24.6% Diploma/ Conferences 13.0% GCE ‘A’ Levels 42.6% Bachelors’ Degree 61.3% Industry-related and GCE ‘O’ Levels/ job-specific external Graduate Diploma 0.5% Industrial Certification 47.8% courses 78.4% Diploma/GCE ‘A’ Levels 9.1% Secondary 6.1% Skills training 4.6% Others 4.5% Primary 0.9% Leadership courses 4.0%

Corporate Social Responsibility People Review 137 Corporate Social Responsibility Contributing to the Community

As a responsible global corporate citizen, Keppel Land contributes positively to the communities in which it operates.

Keppel Land promotes employee volunteerism through the Keppel Volunteers programme.

Adopting Best Practices Singapore, since 2006. The Group is Keppel Volunteers Keppel Land believes in contributing to also one of the founding and charter As part of the Keppel Group’s Volunteers and positively impacting the communities members of the Investor Relations programme to encourage good corporate where it operates. It constantly strives Professionals Association (Singapore), citizenship, Keppel Land continued to to adopt and implement best practices which aims to cultivate best practices support the schools under its adopted in its business operations, with the aim and enhance the professional charity, the Association of Persons with to conduct its business in a socially standards of investor relations locally. Special Needs (APSN). Staff are given responsible and ethical manner, engaging two days from work a year to participate stakeholders, protecting the environment Caring for the Community in the programme, which is now into its and contributing to the communities. Recognising that charity goes beyond ninth year. monetary contributions, Keppel Land Keppel Land has been a member of the and its staff offer their time and ability Championing Charity Causes Singapore Compact, a national society to create effective and sustainable For the second consecutive year, with the aim of furthering the corporate programmes for the community. Keppel Land and sister company social responsibility movement in Keppel Integrated Engineering were

Keppel Land Limited 138 Report to Shareholders 2008 A keen supporter of the arts, Keppel Land continues to support cultural programmes in Singapore and overseas.

platinum sponsors for the second Singapore Management University event which showcases contemporary Semakau Corporate Environmental Ambassadors raising funds for the works from outstanding local and Outreach Run in October 2008. Elephant Nature Foundation, Tabitha foreign talents. Organised by the National Environment Foundation and the Riverkids Project Agency, the run raised funds to benefi t to showcase their products. The Group also continued to support local environmental non-governmental efforts to enhance cultural understanding organisations in their community Keppel Land also collaborated with and diplomatic relations between outreach programmes. World Vision to promote the ‘Tree of Life’ Singapore and Vietnam such as Viet Nam! campaign, a child sponsorship From Myth To Modernity, a landmark Keppel Land also sponsored a SMRT programme which provides basic exhibition organised by the National ‘Heart Train’ and helped raise $200,000 essentials like clean water, food, Heritage Board that traces some 2,500 with a charity golf tournament to benefi t education, healthcare, and economic years of Vietnam’s history. 31 benefi ciaries, in support of the opportunities to children, families and President’s Challenge 2008. their communities in developing countries. In recognition for its contribution towards the promotion of cultural and artistic During the Christmas season, Supporting the Arts and Culture activities in Singapore, Marina Bay Keppel Land organised a Christmas Keppel Land was the studio programme Financial Centre received the Associate Bazaar and invited local and international sponsor for the Huayi Chinese Festival of the Arts Award by the National charities such as the Institute of Mental of Arts organised by the Esplanade for Arts Council. Health, APSN, Cicada Tree Eco-Place, the third consecutive year, an annual

Corporate Social Responsibility Contributing to the Community 139 Corporate Social Responsibility Contributing to the Community

Contributing to Overseas international pledging conference, student hostel in Luoyuan in Fujian Communities co-organised by the Association of Province, China. A Singapore-based Helping Victims of Southeast Asian Nations and the United charitable organisation, MILK reaches Sichuan Earthquake and Nations that sought further international out to disadvantaged children locally Myanmar Cyclone fi nancial aid commitment for Myanmar’s and overseas in the hope of developing Following a Keppel Group-wide donation cyclone aid relief and rehabilitation efforts. them into contributing members of of about US$1 million channelled through society. The hostel, which will house the Red Cross Society of China for the Supporting Local Communities some 650 needy students, is part of rebuilding of lives and rehabilitation efforts In Saudi Arabia, Keppel Land donated a school for children from troubled in earthquake-hit Sichuan in China, SR 1 million (US$270,000) towards the or low-income families. Keppel Land Keppel Land extended its commitment upgrading of the city of Jeddah such as also partook in MILK Fund’s Share-a- and donated RMB 350,000 (US$50,000) the redevelopment of the roundabout Meal programme in Singapore, where to support the ‘One Love Charity Festival’, at Prince Abdul Majed Square at Tahlia donation by staff was matched dollar- a Singapore-led effort to raise funds to Street. The Group also sponsored the for-dollar by the Company. improve lives of children affected by the Jeddah Municipality’s public education earthquake. Earlier quake relief efforts event on urbanisation, new parks In Kunming, China, Keppel Land’s also included placement of donation and facilities as well as selected Spring City Golf & Lake Resort has boxes at Keppel Land’s offi ces and developments. been supporting and sponsoring residential properties in Beijing, Shanghai, foreign volunteer doctors to provide Chengdu and Wuxi. Spring City Golf & In Indonesia, Keppel Land organised a health care services to the local Lake Resort in Kunming also raised large-scale giant kite fl ying festival for villagers. In November, it sponsored over RMB250,000 with a charity golf the public at its Jakarta Garden City RMB 74,000 (US$11,000) in medical game and auction. township development in November, and transportation fees for about 40 with the objective of reviving interest in cataract patients from various remote In Myanmar, Sedona Hotels International the age-old tradition and to encourage villages for surgery at two hospitals. extended assistance to employees who more people to appreciate the rich Staff from Spring City also contributed were affected by Cyclone Nargis in May. Indonesian heritage. through monthly voluntary donations. Sedona Hotel Yangon gave out up to two months of advance salary to affected Improving Lives of the Poor Sedona Suites Hanoi in Vietnam held a employees to rebuild and repair their To support the local community’s Christmas Charity Bazaar and proceeds houses while others were provided with development, Keppel Land contributed were donated to Nguyen Dinh Chien food commodity items on a weekly basis. RMB 1 million towards Mainly I Love School for the Blind. Sedona Hotel Yangon also hosted an Kids (MILK) for the construction of a In Myanmar, staff from Sedona Hotel Yangon bring lunch and cheer to the orphanage and schools every month, with donations such as food, toys, books and clothes. Sedona Hotel Mandalay initiated a weekly clean up of the Royal Palace Moat from March 2008 and hosted a Charity Fun Run along the Palace Moat in November.

Sedona Hotel Manado and Sedona Hotel Mandalay have initiated a one- year and six-month hospitality training course respectively to train local youths interested in working in the local hospitality industry.

For more details on Keppel Land’s community efforts, please refer to the Nurturing Communities section in Keppel Land’s Sustainability Report Sedona Hotel commemorated World Environment Day with tree planting. 2008 on pages 40 to 45.

Keppel Land Limited 140 Report to Shareholders 2008 Directors’ Report & Financial Statements

Contents 142 Directors’ Report 146 Statement by Directors 147 Independent Auditors’ Report 148 Consolidated Profit and Loss Account 149 Balance Sheets 150 Statement of Changes in Equity 154 Consolidated Cashflow Statement 156 Notes to the Financial Statements 199 Significant Subsidiary and Associated Companies 206 Corporate Information 207 Calendar of Financial Events 208 Corporate Structure 210 Property Portfolio 227 Statistics of Shareholdings 229 Notice of Annual General Meeting 236 Share Transaction Statistics Proxy Form

141 Directors' Report For the financial year ended 31 December 2008

The Directors submit their report together with the audited consolidated financial statements of Keppel Land Limited (“the Company”) and its subsidiary companies (collectively, “the Group”) and the balance sheet and statement of changes in equity of the Company as at 31 December 2008.

1. Directors The Directors of the Company in office at the date of this report are:

Lim Chee Onn, Chairman Kevin Wong Kingcheung, Group Chief Executive Officer Khor Poh Hwa Lim Ho Kee Tsui Kai Chong Lee Ai Ming Tan Yam Pin Niam Chiang Meng Heng Chiang Meng Edward Lee Kwong Foo Choo Chiau Beng Teo Soon Hoe

The Directors holding office at the end of the financial year and their interests in the share capital of the Company and related companies as recorded in the register of Directors’ shareholdings were as follows:

Holdings At 01.01.2008 31.12.2008 21.01.2009

Interest in shares in the Company: Kevin Wong Kingcheung 613,400 813,400 813,400 Edward Lee Kwong Foo 50,000 70,000 70,000

Interest in share options in the Company: Kevin Wong Kingcheung 700,000 700,000 700,000

Interest in shares in Keppel Corporation Limited (“KCL”): Lim Chee Onn 2,714,166 3,954,166 3,954,166 Lim Ho Kee - 400,000 400,000 Lim Ho Kee (Deemed interest) - 60,000 60,000 Tan Yam Pin (Deemed interest) 120,000 120,000 120,000 Choo Chiau Beng 981,666 1,631,666 1,631,666 Choo Chiau Beng (Deemed interest) 200,000 200,000 200,000 Teo Soon Hoe 2,708,332 3,628,332 3,628,332

Interest in share options in KCL: Lim Chee Onn 3,720,000 3,100,000 3,100,000 Choo Chiau Beng 1,840,000 1,610,000 1,610,000 Teo Soon Hoe 2,760,000 2,300,000 2,300,000

Keppel Land Limited 142 Report to Shareholders 2008 Holdings At 01.01.2008 31.12.2008 21.01.2009

Interest in Keppel Structured Notes Pte Limited (S$ Commodity Linked Guaranteed Note Series 1 due 2011): Teo Soon Hoe $100,000 $100,000 $100,000

Interest in units in K-REIT Asia: Kevin Wong Kingcheung 247,880 1,444,488 1,444,488 Lim Ho Kee - 200,000 200,000 Lee Ai Ming - 130,000 130,000 Choo Chiau Beng - 780,000 780,000

Interest in shares in Keppel Telecommunications & Transportation Limited: Lim Chee Onn 23,000 23,000 23,000 Teo Soon Hoe 28,000 28,000 28,000

Interest in Keppel Philippines Holdings Inc (“B” shares of 1 Peso each): Lim Chee Onn 2,000 2,000 2,000 Choo Chiau Beng 2,000 2,000 2,000 Teo Soon Hoe 2,000 2,000 2,000

Interest in Keppel Philippines Marine Inc (Shares of 1 Peso each): Lim Chee Onn 246,457 - - Choo Chiau Beng 283,611 - - Teo Soon Hoe 302,830 - -

Interest in Keppel Philippines Properties Inc (Shares of 1 Peso each): Teo Soon Hoe 2,916 - -

Since the end of the previous financial year, no Director has received or become entitled to receive benefits under contracts required to be disclosed by Section 201(8) of the Companies Act, Cap. 50.

Neither at the end of the financial year, nor at any time during the year, did there subsist any arrangements, to which the Company or any of its subsidiary companies is a party, whereby the Directors might acquire benefits by means of acquisition of shares in or debentures of the Company or any other body corporate other than the Keppel Land Share Option Scheme approved by shareholders at an Extraordinary General Meeting.

In accordance with the Company’s Articles of Association, the following Directors retire at the forthcoming Annual General Meeting, and being eligible, offer themselves for re-election:

Khor Poh Hwa Lee Ai Ming Choo Chiau Beng Teo Soon Hoe

Directors’ Report 143 Directors’ Report

2. Share Options of the Company The particulars of share options of the Company are as follows:

(a) Details of share options granted under the Keppel Land Share Option Scheme (“the Scheme”) are disclosed in Note 12 to the financial statements.

(b) Options to take up 1,624,000 shares were granted to senior employees during the financial year. Altogether 1,142,000 shares were issued by virtue of the exercise of options, and options to take up 616,500 shares were cancelled during the financial year. At the end of the financial year, there were 3,867,500 shares under option as follows:

Number of Share Options

At 01.01.08 or Cancelled/ Subscription Value of Date of Grant Date of Grant Exercised Lapsed At 31.12.08 Expiry Date Price ($) Options ($)

05.03.99 27,000 (9,000) - 18,000 04.03.09 1.71 0.7938 20.08.99 67,000 (21,000) - 46,000 19.08.09 2.48 1.2020 06.04.00 88,000 (39,000) (4,000) 45,000 05.04.10 1.87 0.9004 14.11.00 105,000 (43,000) (3,000) 59,000 13.11.10 2.47 1.2030 11.10.01 20,000 - - 20,000 10.10.11 1.35 0.6185 07.08.02 38,000 (15,000) - 23,000 06.08.12 1.44 0.6407 11.02.04 65,000 (65,000) - - 10.02.14 1.86 0.8193 11.08.04 165,000 (165,000) - - 10.08.14 1.84 0.8070 09.12.05 425,000 (295,000) - 130,000 08.12.15 2.38 1.0830 09.12.05 487,500 (215,000) - 272,500 08.12.15 3.07 1.4397 08.02.06 595,000 (210,000) (42,500) 342,500 07.02.16 3.90 1.3620 10.08.06 627,000 (65,000) (112,000) 450,000 09.08.16 4.06 1.3894 27.11.07 630,000 - (115,000) 515,000 26.11.17 7.98 2.6404 27.11.07 662,500 - (115,000) 547,500 26.11.17 8.03 2.5801 4,002,000 (1,142,000) (391,500) 2,468,500 12.02.08 749,500 - (112,500) 637,000 11.02.18 5.90 1.5354 13.08.08 874,500 - (112,500) 762,000 12.08.18 4.40 1.1161 5,626,000 (1,142,000) (616,500) 3,867,500

The value of each option granted at the date of grant is estimated using the Black-Scholes model with a 5-year maturity.

Aggregate Options Aggregate Options Granted since Exercised since Commencement Commencement Aggregate Options Options Granted of the Scheme of the Scheme Outstanding as during the to the End of the to the End of the at the End of the Name of Director Financial Year Financial Year Financial Year Financial Year

Kevin Wong Kingcheung 200,000 2,602,360 1,509,400 700,000

(d) No employee has received 5 per cent or more of the total number of options available under the Scheme.

Keppel Land Limited 144 Report to Shareholders 2008 3. Share Options of Evergro Properties Limited At the end of the financial year, there were no unissued shares of Evergro Properties Limited (“Evergro”) under its Employees’ Share Option Scheme. Details and terms of the options have been disclosed in the Annual Report of Evergro.

4. Audit Committee The Audit Committee comprises three independent Directors. Members of the Committee are:

Tsui Kai Chong, Chairman Lee Ai Ming Heng Chiang Meng

The Audit Committee carried out its functions in accordance with the Companies Act, Cap. 50 which included the following:

− Reviewed the audit plans and reports of the Company’s external auditors and internal auditors, and considered the effectiveness of actions/policies taken by Management on their recommendations and observations; − Reviewed the assistance given by the Company’s officers to the auditors; − Carried out review of quarterly financial reports and year-end financial statements; − Examined the effectiveness of financial, operating and compliance controls; − Reviewed the independence and objectivity of the external auditors; − Reviewed the nature and extent of non-audit services performed by external auditors; − Met with external auditors and internal auditors, without the presence of Management; − Ensured that the internal audit function is adequately resourced and has appropriate standing within the Company; − Reviewed interested person transactions; − Reviewed the effectiveness of the Group’s risk management policies, processes and strategies; and − Investigated any matters within the Audit Committee’s terms of reference.

The Audit Committee has recommended to the Board of Directors the re-appointment of Ernst & Young LLP, Public Accountants and Certified Public Accountants as external auditors of the Company at the forthcoming Annual General Meeting.

5. Auditors The auditors, Ernst & Young LLP, Public Accountants and Certified Public Accountants, have expressed their willingness to accept re-appointment as auditors.

On behalf of the Board

Lim Chee Onn Kevin Wong Kingcheung Chairman Group Chief Executive Officer

Singapore, 28 February 2009

Directors’ Report 145 Statement by Directors For the financial year ended 31 December 2008

We, LIM CHEE ONN and KEVIN WONG KINGCHEUNG, being two of the Directors of Keppel Land Limited, do hereby state that, in the opinion of the Directors:

(a) the accompanying balance sheets, consolidated profit and loss account, statements of changes in equity, and consolidated cash flow statement together with the notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2008 and the results of the business, changes in equity, and cash flows of the Group and the changes in equity of the Company for the year then ended on that date; and

(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

On behalf of the Board

Lim Chee Onn Kevin Wong Kingcheung Chairman Group Chief Executive Officer

Singapore, 28 February 2009

Keppel Land Limited 146 Report to Shareholders 2008 Independent Auditors’ Report For the financial year ended 31 December 2008

To the members of Keppel Land Limited We have audited the accompanying financial statements of Keppel Land Limited (“the Company”) and its subsidiary companies (collectively, “the Group”) set out on pages 148 to 205, which comprise the balance sheets of the Group and the Company as at 31 December 2008, the statements of changes in equity of the Group and the Company, the profit and loss account and cash flow statement of the Group for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Management’s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the Singapore Companies Act, Cap. 50 (“the Act”) and Singapore Financial Reporting Standards. This responsibility includes devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss account and balance sheet and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion,

(i) the consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2008 and the results, changes in equity and cash flows of the Group and the changes in equity of the Company for the year ended on that date; and

(ii) the accounting and other records required by the Act to be kept by the Company and by those subsidiary companies incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.

Ernst & Young LLP Public Accountants and Certified Public Accountants

Singapore, 28 February 2009

Independent Auditors’ Report 147 Consolidated Profit and Loss Account For the financial year ended 31 December 2008

2008 2007 Note $’000 $’000

Sales 2 842,166 1,407,886 Cost of sales (531,722) (985,324)

Gross profit 310,444 422,562

Distribution costs (7,054) (17,310) Administrative and other expenses (86,136) (92,983) Other income 14,490 -

Operating profit 3 231,744 312,269 Interest and investment income 4 50,374 58,818 Interest expense 5 (51,400) (79,216) Share of results of associated companies 20 68,127 93,856 Gain on acquisition of additional interest in an associated company 6 10,718 - Corporate restructuring surplus 7 - 235,230

Pre-tax profit before fair value gain on investment properties/impairment 309,563 620,957 Fair value gain on investment properties/impairment 8 4,467 367,779

Pre-tax profit after fair value gain on investment properties/impairment 314,030 988,736 Taxation 9 (44,654) (151,852)

Profit after taxation 269,376 836,884

Attributable to: Shareholders of the Company 1 227,669 779,650 Minority interests 1 41,707 57,234

Profit after taxation 269,376 836,884

Basic earnings per share (cents) based on: 11 Profit before fair value gain on investment properties/impairment 31.1 71.5 Profit after fair value gain on investment properties/impairment 31.6 108.3

Diluted earnings per share (cents) based on: 11 Profit before fair value gain on investment properties/impairment 31.1 68.9 Profit after fair value gain on investment properties/impairment 31.6 103.5

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Keppel Land Limited 148 Report to Shareholders 2008 Balance Sheets As at 31 December 2008

Group Company 2008 2007 2008 2007 Note $’000 $’000 $’000 $’000

Share capital 12 1,188,479 1,185,341 1,188,479 1,185,341 Reserves 13 1,254,081 1,105,890 722,868 423,713

Share capital and reserves 2,442,560 2,291,231 1,911,347 1,609,054 Minority interests 454,374 352,460 - -

Total equity 2,896,934 2,643,691 1,911,347 1,609,054 Long-term borrowings 14 1,937,767 1,955,914 789,579 833,488

4,834,701 4,599,605 2,700,926 2,442,542

Represented by: Fixed assets 15 173,881 148,417 52 57 Investment properties 16 1,432,952 1,378,315 - - Properties held for development 17 174,781 172,657 - - Amounts owing by associated companies 18 813,824 737,182 - - Investments Subsidiary companies 19 - - 1,233,220 1,108,282 Associated companies 20 959,431 665,412 125,320 125,320 Long-term investments 21 60,936 56,949 4,387 4,677 1,020,367 722,361 1,362,927 1,238,279

Current assets Properties held for sale 22 1,474,594 1,421,669 - - Stocks 23 3,620 3,550 - - Debtors 24 253,815 196,317 378 1,007 Amounts owing by holding company and related parties 25 147,890 147,497 1,641,121 1,871,370 Cash and cash equivalents 26 626,361 1,187,305 7,168 10,980 2,506,280 2,956,338 1,648,667 1,883,357 Less: Current liabilities Creditors 27 798,587 862,698 20,182 12,417 Net tax provision 9 106,200 121,606 5,811 3,556 Short-term borrowings 28 184,051 318,862 108,500 192,250 Amounts owing to holding company and related parties 25 72,087 81,811 166,407 460,181 1,160,925 1,384,977 300,900 668,404

Net current assets 1,345,355 1,571,361 1,347,767 1,214,953

Deferred taxation 9 (126,459) (130,688) (9,820) (10,747)

4,834,701 4,599,605 2,700,926 2,442,542

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Balance Sheets 149 Statements of Changes in Equity For the financial year ended 31 December 2008

Foreign Currency Share Capital Translation revenue minority Total Capital reserves Account reserves Total Interests Equity $’000 $’000 $’000 $’000 $’000 $’000 $’000

Group Balance at 1 January 2008 1,185,341 62,103 (1,324) 1,045,111 2,291,231 352,460 2,643,691 Net fair value change on available-for-sale financial assets - 11,059 - - 11,059 16 11,075 Net fair value on available-for-sale financial assets transferred to profit and loss account - (9,655) - - (9,655) (47) (9,702) Exchange differences on consolidation - - 56,941 - 56,941 (5,817) 51,124 Transfer from revenue reserves to capital reserves - 309 - (309) - - -

Net gains/(losses) directly recognised in equity - 1,713 56,941 (309) 58,345 (5,848) 52,497 Net profit for the year - - - 227,669 227,669 41,707 269,376

Total recognised gains for the year - 1,713 56,941 227,360 286,014 35,859 321,873

Issue of shares under the Keppel Land Share Option Scheme 3,138 - - - 3,138 - 3,138 Cost of share-based payments - 2,754 - - 2,754 - 2,754 Dividend paid (see Note 10) - - - (144,224) (144,224) (212) (144,436) Capital contribution - - - - - 65,917 65,917 Transfer to profit and loss account - - 3,647 - 3,647 - 3,647 Minority interest of non-wholly owned subsidiary company acquired - - - - - 350 350

Balance at 31 December 2008 1,188,479 66,570 59,264 1,128,247 2,442,560 454,374 2,896,934

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Keppel Land Limited 150 Report to Shareholders 2008 Property revaluation Foreign And Other Currency Share Capital Translation revenue minority Total Capital reserves Account reserves Total Interests Equity $’000 $’000 $’000 $’000 $’000 $’000 $’000

Group Balance at 1 January 2007 1,183,413 310,164 (38,636) 135,993 1,590,934 310,018 1,900,952 Property revaluation reserve transferred to revenue reserves - (263,043) - 263,043 - - - Deferred tax adjustment for investment properties - - - (88,061) (88,061) (18,069) (106,130)

1,183,413 47,121 (38,636) 310,975 1,502,873 291,949 1,794,822

Net fair value change on available-for-sale financial assets - 9,129 - - 9,129 28 9,157 Exchange differences on consolidation - - 4,781 - 4,781 (6,865) (2,084) Transfer from revenue reserves to capital reserves - 2,336 - (2,336) - - - Net gains/(losses) directly recognised in equity - 11,465 4,781 (2,336) 13,910 (6,837) 7,073 Net profit for the year - - - 779,650 779,650 57,234 836,884

Total gains recognised for the year - 11,465 4,781 777,314 793,560 50,397 843,957

Issue of shares under the Keppel Land Share Option Scheme 1,928 - - - 1,928 - 1,928 Cost of share-based payments - 2,771 - - 2,771 - 2,771 Dividend paid (see Note 10) - - - (43,178) (43,178) (3,915) (47,093) Capital contribution - - - - - 4,131 4,131 Transfer to profit and loss account - - 32,531 - 32,531 10,742 43,273 Minority interest of a non-wholly owned subsidiary company disposed - - - - - (844) (844) Deferred tax adjustment for equity portion of convertible bond - 746 - - 746 - 746

Balance at 31 December 2007 1,185,341 62,103 (1,324) 1,045,111 2,291,231 352,460 2,643,691

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Statement of Changes in Equity 151 Statements of Changes in Equity

Share Capital revenue Capital reserves reserves Total $’000 $’000 $’000 $’000

Company Balance at 1 January 2008 1,185,341 40,273 383,440 1,609,054

Net fair value change for available-for-sale financial assets - (290) - (290) Net loss directly recognised in equity - (290) - (290) Net profit for the year - - 440,915 440,915

Total (loss)/gain recognised for the year - (290) 440,915 440,625

Issue of shares under the Keppel Land Share Option Scheme 3,138 - - 3,138 Cost of share-based payments - 2,754 - 2,754 Dividend paid (see Note 10) - - (144,224) (144,224)

Balance at 31 December 2008 1,188,479 42,737 680,131 1,911,347

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Keppel Land Limited 152 Report to Shareholders 2008

Share Capital revenue Capital reserves reserves Total $’000 $’000 $’000 $’000

Company Balance at 1 January 2007 1,183,413 35,367 366,817 1,585,597

Net fair value change for available-for-sale financial assets - 1,389 - 1,389 Net gain directly recognised in equity - 1,389 - 1,389 Net profit for the year - - 59,801 59,801

Total gains recognised for the year - 1,389 59,801 61,190

Issue of shares under the Keppel Land Share Option Scheme 1,928 - - 1,928 Cost of share-based payments - 2,771 - 2,771 Dividend paid (see Note 10) - - (43,178) (43,178) Deferred tax adjustment for equity portion of convertible bond - 746 - 746

Balance at 31 December 2007 1,185,341 40,273 383,440 1,609,054

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Statement of Changes in Equity 153 Consolidated Cashflow Statement For the financial year ended 31 December 2008

2008 2007 $’000 $’000

Operating Activities: Operating profit 231,744 312,269 Adjustments for: Depreciation of fixed assets 7,699 9,653 Profit on sale of fixed assets (21) (258) Profit on sale of quoted equity investments (8,540) - Write-back of provision for foreseeable losses on properties held for sale (24,616) (109,414) Net allowance for doubtful debts 3,620 3,067 Cost of share-based payments 2,754 2,771

Operating cash flows before changes in working capital 212,640 218,088

Decrease/(increase) in debtors 36,932 (32,757) Increase in work-in-progress (161,949) (172,476) Increase in consumable stocks (70) (113) Development expenditures (535,473) (752,571) Progress payment received/receivable 682,036 1,037,487 Increase/(decrease) in creditors (69,541) 188,464

Cash flows from operations 164,575 486,122

Interest received 41,021 58,000 Interest paid (51,400) (79,216) Income taxes paid (59,728) (27,734)

Net cash flows from operating activities 94,468 437,172

Investing Activities: Acquisition of a subsidiary company (1,400) (97,059) Investment in associated companies (262,963) (18,277) Investment in investee companies (1,848) (14,175) Purchase of fixed assets (13,045) (7,746) Expenditure on investment properties (80,508) (25,688) Expenditure on development properties (10,386) (3,605) Redemption of preference shares by an associated company 961 - Proceeds from restructuring of an associated company - 582,808 Proceeds from sale of interest in an investee company 11,250 - Dividends received from associated companies* 38,724 34,879 Dividends received from investee companies* 9,353 818 Proceeds from sale of fixed assets 67 897

Net cash flows generated from/(used in) investing activities (309,795) 452,852

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Keppel Land Limited 154 Report to Shareholders 2008 2008 2007 $’000 $’000

Financing Activities: Proceeds from issuance of shares by the Company 3,138 1,928 Drawdown of loans 456,656 218,677 Repayment of loans (616,458) (458,601) Drawdown/(repayment) of loans by related companies (13,157) 22,331 Advances to joint venture partners (50,225) - Repayment by/(loans to) associated companies (73,602) 26,476 Dividends paid to shareholders (144,224) (43,178) Repayment of loans to minority interests of certain subsidiary companies (1,082) (56,204) Contribution from minority shareholders 70,061 13,705 Dividends paid to minority shareholders (212) (3,915)

Net cash flows used in financing activities (369,105) (278,781)

Net (decrease)/increase in cash and cash equivalents (584,432) 611,243 Cash and cash equivalents at beginning of year 1,187,305 580,951 Exchange adjustments 23,488 (4,889)

Cash and cash equivalents at end of year (see Note 26) 626,361 1,187,305

The acquisition of shares in subsidiary company has been shown as a separate item, and its effect on the individual assets and liabilities of the Group is not reflected in the above statement. During the year, the fair values of the net assets of a subsidiary company that was acquired were as follows:

2008 2007 $’000 $’000

Properties held for sale 1,750 97,059 Minority interests (350) -

Net cash outflow on acquisition of a subsidiary company 1,400 97,059

* Comparative figures have been reclassified to conform with the current year’s presentation.

The notes shown on pages 156 to 205 form an integral part of the financial statements.

Consolidated Cashflow Statement 155 Notes to the Financial Statements For the financial year ended 31 December 2008

These notes form an integral part of and should be read in conjunction with the accompanying financial statements.

I. General The Company is a limited liability company incorporated in Singapore, and is listed on the Singapore Exchange Securities Trading Limited.

The registered office and principal place of business of the Company is located at 230 Victoria Street #15-05, Bugis Junction Towers, Singapore 188024.

The financial statements of Keppel Land Limited for the financial year ended 31 December 2008 were authorised for issue on 28 February 2009 in accordance with a resolution of the Board of Directors.

The principal activity of the Company is that of a holding, management and investment company.

The principal activities of its subsidiary companies consist of property investment and development, fund management and property related services.

The immediate and ultimate holding company is Keppel Corporation Limited, incorporated in Singapore, and is listed on the Singapore Exchange Securities Trading Limited.

II. Significant Accounting Policies (a) Basis of Preparation The consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”). The financial statements have been prepared under the historical cost convention, except as disclosed in the accounting policies below.

Adoption of New and Revised Standards In the current year, the Group adopted the following Interpretation of FRS (“INT FRS”) that is relevant and effective for financial years beginning on or after 1 January 2008:

INT FRS 111 FRS 102 Group and Treasury Share Transactions

The adoption of the above INT FRS did not result in any substantial change to the Group’s accounting policies nor any significant impact on the financial statements.

The financial statements are expressed in Singapore dollars and all values are rounded to the nearest thousand ($’000), except where otherwise indicated.

(b) Basis of Consolidation The consolidated financial statements comprise the financial statements of the Company and its subsidiary companies as at the balance sheet date. The financial statements of the subsidiary companies used in the preparation of the consolidated financial statements are prepared for the same reporting date as the parent company. Consistent accounting policies are applied to like transactions and events in similar circumstances.

All intra-group balances, incomes and expenses and unrealised gains and losses resulting from intra-group transactions are eliminated in full.

Acquisitions of subsidiary companies are accounted for using the purchase method. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Costs directly attributable to acquisitions are included as part of the cost of acquisition.

Keppel Land Limited 156 Report to Shareholders 2008 Any excess of the cost of the business combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities is recorded as goodwill on the balance sheet. Any excess of the Group’s share in the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of business combination is recognised as income in the profit and loss account on the date of acquisition.

Subsidiary companies are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases.

Minority interests represent the portion of profit or loss and net assets in subsidiary companies not held by the Group and are presented separately in the consolidated profit and loss account and within equity in the consolidated balance sheet, separately from parent shareholders’ equity.

(c) Fixed Assets Fixed assets are initially recorded at cost and subsequently measured at cost less accumulated depreciation and any impairment in value. When the carrying amount of an asset is greater than its estimated recoverable amount, it is written down to its recoverable amount. Profits or losses on disposal of fixed assets are included in the profit and loss account.

All fixed assets, except for freehold and leasehold land with expiring tenures of over 20 years, are depreciated on a straight-line basis over their estimated useful lives and residual values have also been taken into account where appropriate. No depreciation is provided on freehold land.

The estimated useful lives of the Group’s fixed assets are as follows:

Freehold buildings 30 to 50 years Leasehold land and buildings Over period of lease Machinery and equipment 3 to 7 years Motor vehicles 4 to 5 years

The estimated useful lives, residual values and depreciation method are reviewed at each balance sheet date, with the effect of any changes in estimates accounted for on a prospective basis.

(d) Investment Properties Investment properties are properties held either to earn rental and/or for capital appreciation. Investment properties are initially recognised at cost, including transaction costs, and subsequently measured at fair value, determined annually by Directors based on valuations by independent professional valuers. Changes in fair value are recognised in the profit and loss account in the year in which they arise.

Investment properties are derecognised when either they are disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. Any gains or losses on the retirement or disposal of investment properties are recognised in the profit and loss account in the year of retirement or disposal.

When there is a change of use, transfers to or from investment properties to another asset category are recorded at the carrying values of the properties at the date of transfer.

(e) Properties Held for Development Properties held for development are stated at cost less any impairment in value. Cost includes cost of land and construction, related overhead expenditure, financing charges and other net costs incurred during the period of development. They are considered completed and are transferred to investment properties or fixed assets when they are ready for their intended use.

Notes to the Financial Statements 157 Notes to the Financial Statements

II. Significant Accounting Policies (continued) (f) Subsidiary Companies A subsidiary company is an entity over which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

In the Company’s separate financial statements, investments in subsidiary companies are accounted for at cost less impairment losses. On disposal of a subsidiary company, the difference between the net disposal proceeds and the carrying amount of the investment is taken to profit and loss account.

(g) Associated Companies An associated company is an entity, not being a subsidiary company or a joint venture, in which the Group has significant influence, but not control, in the operating and financial policy decisions.

Investments in associated companies are accounted for in the consolidated financial statements using the equity method of accounting whereby the Group’s share of profits or losses of the associated companies are included in the Group’s profit and loss account and the Group’s share of net assets of the associated companies are included in the balance sheet.

Any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the associated company recognised at the date of acquisition is recognised as goodwill. The goodwill is included within the carrying amount of the investment and is assessed for impairment as part of the investment. Any excess of the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised immediately in the profit and loss account as part of Group’s share of results of the associated company in the year in which the investment is acquired.

When the Group’s share of losses in an associated company equals or exceeds its interest in the associated company, the Group does not recognise further losses, unless it has incurred obligations or made payments on their behalf of the associated company.

The most recently available audited financial statements of the associated companies are used by the Group in applying the equity method. Where the dates of the audited financial statements used are not co-terminous with those of the Group, the share of results is arrived at from the last audited financial statements available and unaudited management financial statements to the end of the accounting year. Where necessary, adjustments are made to align the accounting policies with those of the Group.

Investments in associated companies are stated in the Company’s financial statements at cost less any impairment losses. On disposal of an associated company, the difference between the net disposal proceeds and the carrying amount of the investment is taken to profit and loss account.

(h) Long-term Investments Long-term investments represent non-derivative financial assets that are designated as available-for-sale. After initial recognition, available-for-sale financial assets are measured at fair value with gains or losses being recognised in the available-for-sale asset reserve until the investment is derecognised or until the investment is determined to be impaired at which time the cumulative gain or loss previously reported in equity is included in the profit and loss account.

The fair value of quoted investments is generally determined by reference to the relevant stock exchanges’ quoted market bid prices at the close of business on the balance sheet date. For investments where there is no active market, the fair value is determined using various valuation techniques. Such techniques include using recent arm’s length market transactions, reference to the underlying net asset value of the investee companies and discounted cash flow analysis.

Keppel Land Limited 158 Report to Shareholders 2008 (i) Goodwill Goodwill acquired in a business combination is initially measured at cost, being the excess of the cost of the business combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment, at least annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired.

(j) Derivative Financial Instruments Derivative financial instruments are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at fair value. Derivative financial instruments are carried as assets when the fair values are positive and as liabilities when the fair values are negative.

Gains or losses arising from changes in fair value of derivative financial instruments are taken to the profit and loss account for the year.

(k) Properties Held for Sale Properties held for sale are stated at the lower of cost and net realisable value. The costs are assigned by using specific identification. Cost includes cost of land and construction, related overhead expenditure, and financing charges incurred during the period of development. Net realisable value represents the estimated selling price less costs to be incurred in selling the property. Upon receipt of temporary occupation permits, they are transferred to completed properties held for sale.

Each property under development is accounted for as a separate project. Where a project comprises more than one component or phase with a separate temporary occupation permit, each component or phase is treated as a separate project, and interest and other net costs are apportioned accordingly.

Profit recognised on partly completed projects which are held for sale is based on the percentage of completion method as follows:

(i) For Singapore trading properties under development, the profit recognition upon the signing of sales contracts and payment of the first instalment is 20% of the total estimated profit attributable to the actual contracts signed. Subsequent recognition of profit is based on the stage of physical completion;

(ii) For overseas trading properties under development, the profit recognition upon the signing of sales contracts is the direct proportion of total expected project profit attributable to the actual sales contracts signed, but only to the extent that it relates to the stage of physical completion.

Progress claims made against partly completed projects are offset against their development costs.

When losses are expected, full provision is made in the accounts after adequate allowance has been made for estimated costs to completion. Any expenditure incurred on abortive projects is written off in the profit and loss account.

Profit on partly completed projects which are held for sale less any provision to reduce cost to estimated realisable value as well as the profit or loss on sale of completed properties are included in the operating results.

Completed properties held for sale are stated at the lower of cost and net realisable value. Cost includes cost of land and construction, related overhead expenditure, financing charges and other net costs incurred during the period of development.

Notes to the Financial Statements 159 Notes to the Financial Statements

II. Significant Accounting Policies (continued) (l) Stocks Stocks are valued at the lower of cost and net realisable value. Provision is made for damaged, obsolete or slow- moving stocks on an item by item basis.

(m) Cash and Cash Equivalents Cash and cash equivalents comprise cash on hand, fixed deposits, and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. These also include bank overdrafts that form an integral part of the Group’s cash management.

(n) Financial Assets Financial assets include cash and cash equivalents, debtors, amounts owing by holding company and related parties, and investments. Debtors, amounts owing by holding company and related parties are stated at their fair value as reduced by appropriate allowances for estimated irrecoverable amounts.

When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through the profit and loss account, directly attributable transaction costs. The Group determines the classification of its financial assets after initial recognition and, where allowed and appropriate, re-evaluates this designation at each financial year-end.

A financial asset is derecognised where the contractual right to receive cash flows from the asset has expired. On derecognition of a financial asset, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that has been recognised directly in equity is recognised in the profit and loss account.

Financial assets with fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables comprise trade debtors, other debtors, amounts owing by holding company and related parties, and cash and cash equivalents. Subsequent to initial recognition, loans and receivables are measured at amortised carrying value using the effective interest rate method. Gains and losses are recognised in profit and loss account when the loans and receivables are derecognised or impaired, and through the amortisation process.

(o) Impairment of Assets Impairment of Non-Financial Assets At each balance sheet date, the Group reviews the carrying amounts of its non-financial assets to determine whether there is any indication that the assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss.

For the purpose of impairment testing of goodwill, goodwill is allocated to each of the Group’s cash-generating- units (“CGU”) expected to benefit from synergies arising from the business combination.

An impairment loss is recognised when the carrying amount of an asset or a CGU exceeds its recoverable amount. The recoverable amount of an asset or a CGU is the higher of its fair value less cost to sell and value-in-use.

Impairment losses are recognised in the profit and loss account. Impairment losses recognised in respect of CGU are allocated first to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis of the carrying amount of each asset in the CGU.

An impairment loss in respect of goodwill is not reversed. In respect of other non-financial assets, reversal of impairment loss previously recognised is recorded when there is an indication that the impairment loss recognised for the asset no longer exists or has decreased. The reversal is recorded in the profit and loss account. However, the increased carrying amount of an asset due to any reversal of impairment loss is recognised to the extent that it does not exceed the cost, net of depreciation of that asset at the date of such reversal.

Keppel Land Limited 160 Report to Shareholders 2008 Impairment of Financial Assets The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset or a group of financial assets is impaired.

(i) Assets Carried at Amortised Carrying Value If there is objective evidence that a financial asset carried at amortised carrying value is impaired, the amount of the loss is measured as the difference between the carrying amount of the asset and the present value of estimated future cash flows discounted at the original effective interest rate of the financial asset. The carrying amount of the asset is reduced through the use of an allowance account, and the loss is recognised in the profit and loss account.

When the asset becomes uncollectible, the carrying amount of impaired financial assets is reduced directly or if an amount was charged to the allowance account, the amounts charged to the allowance account are written off against the carrying value of the financial asset.

To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the extent that the carrying value of the asset does not exceed its amortised carrying value at the reversal date. The amount of reversal is recognised in the profit and loss account.

(ii) Assets Carried at Cost If there is objective evidence that a financial asset carried at cost is impaired, the amount of the loss is measured as the difference between the carrying amount of the asset and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed in subsequent periods.

(iii) Available-for-Sale Financial Assets Significant or prolonged decline in fair value below cost, significant financial difficulties of the issuer or obligor, and the disappearance of an active trading market are considerations to determine whether there is objective evidence that available-for-sale financial assets are impaired.

If an available-for-sale financial asset is impaired, the amount comprising the difference between its cost (net of any principal payment and amortisation) and its current fair value, less any impairment loss previously recognised in the equity is transferred from equity to the profit and loss account. Reversals of impairment loss in respect of equity instruments are not recognised in the profit and loss account. Reversals of impairment losses on debt instruments are reversed through the profit and loss account, if the increase in fair value of the instrument can be objectively related to an event occurring after the impairment loss was recognised in the profit and loss account.

Notes to the Financial Statements 161 Notes to the Financial Statements

II. Significant Accounting Policies (continued) (p) Financial Liabilities Financial liabilities are recognised on the balance sheet when, and only when, the Group becomes a party to the contractual provisions of the financial instrument.

Financial liabilities include creditors, amounts owing to holding company and related parties, and borrowings. All financial liabilities are recognised initially at fair value, plus directly attributable transaction costs. Subsequent to initial recognition, they are measured at amortised carrying value using effective interest rate method.

A financial liability is derecognised when the obligation under the liability is extinguished. Any gain or loss is recognised in the profit and loss account when the liability is derecognised or impaired, and through the amortisation process.

(q) Provisions Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events and it is probable that an outflow of economic resources will be required to settle the obligation, and a reliable estimate of the amount can be made.

Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of economic resources will be required to settle the obligation, the provision is reversed. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as an interest expense.

(r) Revenue Recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured at the fair value of consideration received or receivable.

Rental and related income from operating leases on investment properties are recognised on a straight-line basis over the lease term. The aggregate costs of incentives provided to lessees are recognised as a reduction of rental income over the lease term on a straight-line basis.

Revenue recognition from trading properties is set out in paragraph II(k) above. For sales of properties under deferred payment scheme, revenue attributable to the sales price, exclusive of interest is recognised at the date of sale. The sales price is the present value of the considerations, determined by discounting the instalments receivable at the imputed rate of interest. The interest income is recognised as it is earned.

Dividend income is recognised when the Group’s right to receive payment is established.

Interest income is recognised on a time proportion basis (using the effective interest rate method).

Service charges, management fees and car park fees are recognised in the year in which the services are rendered.

(s) Borrowing Costs Borrowing costs incurred to finance the development of properties are capitalised during the period of time that is required to complete and prepare the assets for their intended use. Other borrowing costs are taken to the profit and loss account over the period of borrowing using the effective interest rate method.

Keppel Land Limited 162 Report to Shareholders 2008 (t) Employee Benefits Defined Contribution Plan The Group makes contributions to pension schemes as defined by the laws of the countries in which it has operations. In particular, the Singapore companies make contributions to the Central Provident Fund in Singapore, a defined contribution pension scheme. Contributions to pension schemes are recognised as an expense in the period in which the related service is performed.

Employee Leave Entitlement Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for leave as a result of services rendered by employees up to the balance sheet date.

Share Option Scheme The Group operates an equity-settled, share-based compensation plan. The fair value of the employees’ services received in exchange for the grant of the options is recognised as an expense in the profit and loss account with a corresponding increase in the share option reserve over the vesting period. The total amount recognised over the vesting period is determined by reference to the fair value of the options granted on the date of grant.

(u) Taxation Current Tax Current tax assets and liabilities for the current and prior periods are measured at the amounts expected to be recovered from or paid to the taxation authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date.

Current tax is recognised in the profit and loss account except that tax relating to items recognised directly in equity is recognised directly in equity.

Deferred Tax Deferred tax is provided in full, using the liability method, on temporary differences between the tax bases of assets and liabilities at the balance sheet date and their carrying amounts. The principal temporary differences arise from fair value gain on investment properties, depreciation of fixed assets, unremitted offshore income and certain provisions or charges in the accounts for which the tax relief is not immediately available. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the balance sheet date.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

Deferred tax is recognised as an expense or income in the profit and loss account, except where it relates to items credited or debited directly to equity, in which case the tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination. Deferred tax arising from a business combination is adjusted against goodwill on acquisition.

Notes to the Financial Statements 163 Notes to the Financial Statements

II. Significant Accounting Policies (continued) (u) Taxation (continued) Sales Tax Revenues, expenses and assets are recognised net of the amount of sales tax except:

(i) Where the sales tax incurred in a purchase of an asset or service is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

(ii) Debtors and creditors are stated with the amount of sales tax included.

The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of debtors and creditors in the balance sheet.

(v) Foreign Currencies Functional Currency Items included in the financial statements of each entity in the Group are measured using the currency that best reflects the economic substance of the underlying events and circumstances relevant to that entity (“functional currency”).

The financial statements of the Group and the balance sheet and statement of changes in equity of the Company are presented in Singapore dollars, which is the functional currency of the Company.

Foreign Currency Transactions and Balances Transactions in foreign currencies are translated at exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated at exchange rates approximating those ruling at that date. Exchange differences arising from translation of monetary assets and liabilities are taken to the profit and loss account. Exchange differences on non-monetary items such as available-for-sale investments are included in the available-for-sale asset reserve.

Foreign Currency Translation For inclusion in the Group’s financial statements, all assets and liabilities of foreign subsidiary and associated companies that are in functional currencies other than Singapore dollars are translated into Singapore dollars at the exchange rates ruling at the balance sheet date. The trading results of foreign subsidiary and associated companies are translated into Singapore dollars using the average exchange rates for the financial year. Exchange differences due to such currency translation are classified as reserves and taken directly to the foreign currency translation account. Goodwill and fair value adjustments arising on acquisition of a foreign entity are treated as non-monetary foreign currency assets and liabilities of the acquirer and recorded at the closing exchange rate.

(w) Segment Reporting A business segment is a distinguishable component of the Group that is engaged in providing products and services that are subject to risks and returns that are different from those of other business segments.

Segment information is presented in respect of the Group’s business and geographical segments and is based on the Group’s principal activities and internal reporting structure.

(x) Contingencies A contingent liability or asset is a possible obligation or asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of uncertain future event(s) not wholly within the control of the Group.

Contingent liabilities and assets are not recognised on the balance sheet of the Group.

Keppel Land Limited 164 Report to Shareholders 2008 (y) Critical Accounting Estimates and Judgement (i) Critical judgement made in applying the Group’s accounting policies In the process of applying the Group’s accounting policies, Management is of the opinion that there is no instance of application of judgement which is expected to have a significant effect on the amounts recognised in the financial statements, apart from those involving estimations described below.

Revenue Recognition The Group recognises revenue from partly completed projects based on the percentage of completion method. The stage of completion is measured in accordance with the accounting policy stated in paragraph II(k). Significant assumptions are required in determining the stage of completion, the total estimated development costs and the estimated total revenue. In making the assumptions, the Group evaluates them by relying on past experience and the work of specialists. Revenue from partly completed projects is disclosed in Note 2.

Income Taxes The Group has exposure to income taxes in numerous jurisdictions. Significant assumption is required in determining the provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. The carrying amount of taxation and deferred taxation is disclosed in the balance sheet.

(ii) Key sources of estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are as follows:

Impairment of Non-Financial Assets Determining whether or not the carrying values of non-financial assets are impaired requires an estimation of the value in use of the CGU. This requires the Group to estimate the future cashflows expected from the CGU and an appropriate discount rate in order to calculate the present value of the future cashflows. The carrying amounts of fixed assets, investment properties, properties held for development and properties held for sale at the balance sheet date are disclosed in Notes 15, 16, 17 and 22 respectively.

Impairment of Financial Assets The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, the Company considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments.

When there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amounts of financial assets at the balance sheet date are disclosed in Notes 18, 21, 24, 25 and 26 to the financial statements.

Notes to the Financial Statements 165 Notes to the Financial Statements

1. Analysis of the Group’s Profit from Operations/Fair Value Gain on Investment Properties/Impairment

2008 2007

Fair value Fair value Gain/ Gain/ Operations Impairment Total Operations Impairment Total $’000 $’000 $’000 $’000 $’000 $’000

Pre-tax profit 309,563 4,467 314,030 620,957 367,779 988,736 Taxation (43,563) (1,091) (44,654) (82,996) (68,856) (151,852) 266,000 3,376 269,376 537,961 298,923 836,884 Minority interests (42,001) 294 (41,707) (23,351) (33,883) (57,234) Profit attributable to shareholders 223,999 3,670 227,669 514,610 265,040 779,650

2. Sales Group 2008 2007 $’000 $’000

Trading of properties 675,124 1,238,951 Rental and related income 70,275 62,547 Fund management fees 36,493 30,034 Operations of hotels and resorts, property services, and others 60,274 76,354 842,166 1,407,886

Keppel Land Limited 166 Report to Shareholders 2008 3. Operating Profit Group 2008 2007 $’000 $’000

The following amounts have been charged/(credited) in arriving at operating profit:

Depreciation of fixed assets (see Note 15): Freehold buildings 5 5 Leasehold properties 3,915 6,215 Machinery, equipment and vehicles 3,779 3,433 7,699 9,653 Auditors’ remuneration: Auditors of the Company 843 832 Other auditors 1,003 919

Directors’ fees 685 679

Key managers’ emoluments: Short-term benefits (including annual base salaries and annual performance incentives) 7,197 8,494 Employer’s contribution to defined contribution plans, including the Central Provident Fund 73 78 Cost of share-based payments 1,494 1,515 8,764 10,087 Staff costs: Short-term benefits (including annual base salaries and annual performance incentives) 60,569 61,945 Employer’s contribution to defined contribution plans, including the Central Provident Fund 14,404 13,794 Cost of share-based payments 1,260 1,256 76,233 76,995

Value of properties held for sale recognised as expense 475,366 1,011,434

Foreign exchange loss 1,803 6,672

Net allowance for doubtful debts 3,620 3,067

Write-back of provision for foreseeable losses on properties held for sale (24,616) (109,414)

Direct expenses of investment properties that generate rental income 25,661 30,402

Other income: Profit on sale of quoted equity investments 8,540 - Write-back of costs in connection with the restructuring of an associated company 5,950 - 14,490 -

Staff costs capitalised during the year under properties held for development and sale amounted to $7,480,000 (2007: $5,577,000).

Notes to the Financial Statements 167 Notes to the Financial Statements

4. Interest and Investment Income Group 2008 2007 $’000 $’000

Gross dividends from: Quoted investments - 313 Unquoted investments 9,353 505 Interest from instalment and deferred payment schemes 128 5,846 Interest from deposits and short-term loans with: Banks 16,234 6,756 Associated companies 23,758 39,998 Related companies 801 2,189 Others 100 3,211 50,374 58,818

A related company is a subsidiary company of Keppel Corporation Limited in which the Company has no shareholding interest.

Related parties include subsidiary companies, associated companies, related companies, Temasek Group and Directors of the Company and their associates.

Interests on deposits with related companies are earned at the following interest rates per annum:

2008 2007 Lowest Highest Lowest Highest % % % %

Singapore dollar 0.17 2.00 0.95 3.25 United States dollar 0.11 4.13 3.99 5.36 Hong Kong dollar 0.10 3.45 - -

Information on interest rates for interest received from related companies and banks are disclosed in Notes 25 and 26 respectively.

5. Interest Expense Group 2008 2007 $’000 $’000

Fair value loss on revaluation of interest rate hedging instruments - (5,263) Interest expense on: Convertible bond (see Note 14) (13,591) (13,349) Fixed term loans from banks (11,412) (13,104) Other term loans and overdrafts from: Related companies (7,862) (12,371) Banks (6,089) (13,880) Loans from minority shareholders of non-wholly owned subsidiary companies (4,079) (5,884) Income support payable (733) - Borrowings under Multicurrency Medium Term Note (“MTN”) Programme (7,634) (15,365) (51,400) (79,216)

Information on interest rates is disclosed in Notes 14, 25 and 28.

Keppel Land Limited 168 Report to Shareholders 2008 6. Gain on Acquisition of Additional Interest in an Associated Company The gain arose from the excess of the Group’s share of identifiable net tangible assets of an associated company over the acquisition price of the additional units acquired.

7. Corporate Restructuring Surplus The corporate restructuring surplus in 2007 was in respect of the ownership restructuring of an associated company.

8. Fair Value Gain on Investment Properties/Impairment Group 2008 2007 $’000 $’000

(a) Fair value gain on investment properties 4,467 457,052

(b) Impairment in value of: (i) Indonesian rupiah pertaining to the prior years’ investments previously taken to foreign currency translation account - (43,273) (ii) Group’s hotels in Myanmar (see Note 15) - (46,000) 4,467 367,779

The fair value gain on investment properties is analysed as follows:

2008 2007

Deferred Deferred Gross Tax Net Gross Tax Net $’000 $’000 $’000 $’000 $’000 $’000

Subsidiary companies (2,344) 374 (1,970) 168,746 (17,426) 151,320 Associated companies 6,811 (1,465) 5,346 288,306 (51,430) 236,876 4,467 (1,091) 3,376 457,052 (68,856) 388,196 Minority interests 642 (348) 294 (49,292) 4,667 (44,625) 5,109 (1,439) 3,670 407,760 (64,189) 343,571

In 2007, the Group’s share of impairment in value of Indonesian rupiah and hotels in Myanmar amounted to $78,531,000.

Notes to the Financial Statements 169 Notes to the Financial Statements

9. Taxation Group 2008 2007 $’000 $’000

Current tax: Current income tax 37,817 68,942 Overprovision in respect of previous years (3,887) (5,713) 33,930 63,229 Deferred tax: Origination and reversal of temporary differences (1,323) 249 Benefits from previously unrecognised tax losses (1,735) 68,320 (3,058) 68,569

30,872 131,798 Associated companies (see Note 20) 13,782 20,054 44,654 151,852

Included in current year’s tax expense is deferred tax provision of $1,091,000 (2007: $68,856,000) on the fair value gain on investment properties (see Note 8).

A reconciliation between the tax expense reported and the product of accounting profit multiplied by the applicable tax rate is as follows: Group 2008 2007 $’000 $’000

Profit before taxation 314,030 988,736

Tax calculated at tax rate of 18% (2007: 18%) 56,525 177,972 Adjustments: Non-deductible expenses 17,688 34,154 Income not subject to tax (17,191) (77,354) Share of associated companies’ taxes (13,782) (20,054) Overprovision in respect of previous years (3,887) (5,713) Utilisation of capital allowances and losses (2,051) (969) Different tax rates in other jurisdictions (2,281) 24,049 Deferred tax write-back, net of provision (4,149) (287) 30,872 131,798

Under the group tax relief system introduced by the Inland Revenue Authority of Singapore (“IRAS”), a Singapore incorporated company may, upon satisfaction of the criteria set out by IRAS, transfer its current year’s unabsorbed capital allowances, trade losses and donations to another company belonging to the same group, to be deducted against the assessable income of the latter company. The loss so utilised is recognised as a deferred tax asset in the accounts of the transferor company.

Keppel Land Limited 170 Report to Shareholders 2008 Net Tax Provision Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Provision for taxation 108,040 123,881 5,811 3,556 Income tax refund receivable (1,840) (2,275) - - 106,200 121,606 5,811 3,556

Subject to Sections 23 and 37 of the Income Tax Act, Cap 134, the Group has certain unutilised tax losses of $270,378,000 (2007: $281,511,000) and capital allowances of $102,000 (2007: $102,000) at 31 December 2008 for which related tax benefits totalling $48,686,000 (2007: $50,690,000) have not been included in the accounts. The tax losses are available for offset against future taxable profits of the companies in which the losses arose but for which no deferred tax asset has been recognised due to uncertainty of their recoverability.

Deferred Taxation Deferred tax at the end of the year consists of the following: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Tax liabilities arising from: Fair value gain on investment properties 98,011 97,901 - - Differences in depreciation 4,787 5,485 - - Offshore income not remitted 5,782 6,123 4,993 4,963 Differences in fair values and book values of assets of subsidiary companies acquired 13,052 16,207 - - Issuance of convertible bond 4,827 5,784 4,827 5,784 Unutilised tax benefits - (812) - - 126,459 130,688 9,820 10,747

As at 31 December 2008, deferred tax liabilities amounting to $8,000,000 (2007: $5,100,000) had not been recognised for taxes that would be payable on the undistributed earnings of certain subsidiary companies as these earnings are not expected to be distributed in the foreseeable future.

10. Dividends (a) Final Dividend Paid Group and company 2008 2007 $’000 $’000

Dividends on ordinary shares: Final one-tier of 8 cents per share and special dividend of 12 cents per share (2007: 6 cents per share) 144,224 43,178

(b) The Directors propose a final dividend of 8 cents per share be paid for the year ended 31 December 2008, under a proposed Dividend Reinvestment Scheme. The implementation of the Dividend Reinvestment Scheme is contingent upon shareholders’ approval of the addition of a new Article to the Company’s Articles of Association to allow shareholders entitled to dividends to elect to receive the dividends fully in cash, or in new shares in the Company, or partly in cash and the balance in the form of new shares in the Company.

Notes to the Financial Statements 171 Notes to the Financial Statements

11. Earnings per Share Group 2008 2007 $’000 $’000 Basic Diluted Basic Diluted

Profit attributable to shareholders (see Note 1) 223,999 223,999 514,610 514,610 Interest expense on convertible bond - 539 - 13,296 223,999 224,538 514,610 527,906 Fair value gain on investment properties/impairment (see Note 1) 3,670 3,670 265,040 265,040 Profit after fair value gain on investment properties/impairment 227,669 228,208 779,650 792,946

Number of Shares Number of Shares ’000 ’000 Basic Diluted Basic Diluted

Weighted average number of shares 720,882 720,882 719,653 719,653

Adjustment for potential dilutive shares under: Conversion of convertible bond - 1,818 - 45,618 Employee share option scheme - 321 - 1,051 Weighted average number of shares used to compute earnings per share 720,882 723,021 719,653 766,322

Earnings per share (cents) based on: Profit before fair value gain on investment properties/impairment 31.1 31.1 71.5 68.9 Profit after fair value gain on investment properties/impairment 31.6 31.6 108.3 103.5

12. Share Capital Group and Company Group and Company 2008 2007 2008 2007 Number of Number of $’000 $’000 Shares Shares ’000 ’000

Issued and fully paid: 721,317,081 (2007: 720,175,081) shares 721,317 720,175 1,188,479 1,185,341

Issued and fully paid: At 1 January 720,175 719,234 1,185,341 1,183,413 Shares issued under the Keppel Land Share Option Scheme 1,142 941 3,138 1,928 At 31 December 721,317 720,175 1,188,479 1,185,341

During the year, the Company issued for cash 1,142,000 shares comprising 9,000 shares at $1.71 per share, 21,000 shares at $2.48 per share, 39,000 shares at $1.87 per share, 43,000 shares at $2.47 per share, 15,000 shares at $1.44 per share, 65,000 shares at $1.86 per share, 165,000 shares at $1.84 per share, 295,000 shares at $2.38 per share, and 215,000 shares at $3.07 per share, 210,000 shares at $3.90 per share and 65,000 shares at $4.06 per share to certain full-time employees on their exercise of options under the Keppel Land Share Option Scheme.

The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restrictions.

Keppel Land Limited 172 Report to Shareholders 2008 Keppel Land Share Option Scheme (a) The Keppel Land Share Option Scheme (“the Scheme”) which has been approved by the shareholders of the Company is administered by the Remuneration Committee whose members are:

Tan Yam Pin, Chairman Lim Ho Kee Tsui Kai Chong

(b) Under the Scheme, an option may, except in certain special circumstances, be exercised at any time after 2 years but no later than the expiry date. The shares under option may be exercised in full or in respect of 100 shares or a multiple thereof, on the payment of the subscription price. The subscription price is based on the average last business done price for the shares of the Company on the Singapore Exchange Securities Trading Limited for the 3 market days preceding the date of offer. The Remuneration Committee may at its discretion fix the subscription price at a discount not exceeding 20% of the abovementioned average market price. None of the options offered in the financial year was granted at a discount. The executive employees to whom the options have been granted do not have the right to participate by virtue of the options in a share issue of any other company.

(c) Movements in the number of share options and their weighted average exercise prices are as follows: 2008 2007 Weighted Weighted Average Average Number of Exercise Number of Exercise Options Price Options Price

At 1 January 4,002,000 $4.71 3,839,500 $2.85 Granted 1,624,000 $5.09 1,292,500 $8.01 Exercised (1,142,000) $2.75 (941,500) $2.05 Cancelled (616,500) $5.90 (188,500) $2.62 At 31 December 3,867,500 $5.26 4,002,000 $4.71

Exercisable at 31 December 1,406,000 $3.37 1,487,500 $2.45

The weighted average share price at the date of exercise for options exercised during the financial year was $5.74 (2007: $8.46). The options outstanding at the end of the financial year had a weighted average exercise price of $5.26 (2007: $4.71) and a weighted average remaining contractual life of 8.2 years (2007: 8.2 years).

(d) On 12 February 2008 and 13 August 2008, the Company granted options of 749,500 and 874,500 respectively under the Scheme. The estimated fair values of the options granted are $1.5354 and $1.1161 respectively. These fair values are determined using the Black-Scholes pricing model. The main inputs into the model are as follows:

2008 2007 Date of grant 12.02.08 13.08.08 27.11.07 27.11.07 (First (Second Tranche) Tranche)

Share price $5.90 $4.40 $7.98 $8.03 Exercise price $5.90 $4.40 $7.98 $8.03 Expected volatility 31.44% 31.23% 34.78% 34.52% Expected life 5 years 5 years 5 years 5 years Risk free rate 1.56% 2.08% 3.05% 2.61% Expected dividend yield 1.36% 1.82% 0.75% 0.75%

The expected volatility is determined by calculating the historical volatility of the Company’s share price over the previous 5 years. The expected life used in the model has been adjusted, based on Management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.

Notes to the Financial Statements 173 Notes to the Financial Statements

12. Share Capital (continued)

(e) At 31 December 2008, there were options granted to certain employees to take up 3,867,500 unissued shares in the Company as follows: Subscription Price ($) Number of Shares 1.71 18,000 2.48 46,000 1.87 45,000 2.47 59,000 1.35 20,000 1.44 23,000 2.38 130,000 3.07 272,500 3.90 342,500 4.06 450,000 7.98 515,000 8.03 547,500 5.90 637,000 4.40 762,000 3,867,500

(f) Details of share options granted by Evergro Properties Limited (“Evergro”), subsidiary company of the Company are disclosed in the annual report of Evergro.

13. Reserves Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Capital reserves: Equity component of convertible bond 32,663 32,663 32,663 32,663 Share option reserves 8,481 5,727 8,481 5,727 Available-for-sale asset reserves 15,539 14,135 1,593 1,883 Statutory reserves 9,887 9,578 - - 66,570 62,103 42,737 40,273

Foreign currency translation account 59,264 (1,324) - - Revenue reserves 1,128,247 1,045,111 680,131 383,440 1,254,081 1,105,890 722,868 423,713

Movements in the Group’s and the Company’s reserves are set out in the statements of changes in equity.

Keppel Land Limited 174 Report to Shareholders 2008 14. Long-term Borrowings Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Borrowings under MTN Programme 150,000 200,000 150,000 200,000

Liability component of convertible bond 269,579 263,488 269,579 263,488

Bank borrowings: Secured 309,997 290,830 - - Unsecured 388,360 391,760 370,000 370,000 698,357 682,590 370,000 370,000

Unsecured loans from related companies 819,831 809,836 - - 1,937,767 1,955,914 789,579 833,488

The Company has a US$800 million MTN Programme under which it can issue notes (“the Notes”) in series or tranches and may be denominated in Singapore dollars, United States dollars or other currency deemed appropriate at the time.

The Notes are unsecured and comprise floating rate notes due in 2010 of $150,000,000. Interest payable is based on money markets rates ranging from 1.95% to 3.02% (2007: 3.02% to 3.13%) per annum. Floating rate notes are repriced every 6 months.

The Group’s secured bank borrowings are repriced within 1 to 12 months. The securities are mortgages of properties held by subsidiary companies and are repayable between 2 to 4 years.

The Group’s unsecured bank borrowings are repriced every 6 months and are repayable after 1 year.

Loans from related companies have no fixed terms of repayment and are not expected to be repaid over the next 12 months; and are repriced daily or within 7 days to 9 months.

Convertible Bond On 23 June 2006, the Company issued $300,000,000 2.5%, 7-year convertible bond. Interest is payable semi-annually. The bond maturing on 23 June 2013 is convertible at the option of bondholders to ordinary shares of the Company at the conversion price of $6.55 per share. Any bondholder may request that the Company redeems all or some of its bonds on 23 June 2011 or in the event that the Company’s shares ceased to be listed or admitted to trading on the Singapore Exchange Securities Trading Limited.

The liability component of the convertible bond is recognised on the balance sheet as follows:

Group and Company 2008 2007 $’000 $’000

At 1 January 263,488 257,639 Interest expense (see Note 5) 13,591 13,349 Interest paid (7,500) (7,500) At 31 December 269,579 263,488

Interest expense on the convertible bond is calculated based on the effective interest rate method by applying the interest rate of 4.78% per annum for an equivalent non-convertible bond to the liability component of the convertible bond.

Notes to the Financial Statements 175 Notes to the Financial Statements

14. Long-term Borrowings (continued)

The carrying amounts of long-term borrowings are denominated in the following currencies:

Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 1,625,125 1,347,445 789,579 833,488 United States dollar 262,884 570,729 - - Indonesian rupiah 18,360 21,760 - - Hong Kong dollar 16,542 - - - Thai baht 12,686 15,980 - - Renminbi 2,170 - - - 1,937,767 1,955,914 789,579 833,488

Loans due after 1 year are to be repayable as follows:

Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

After 1 but within 2 years 1,531,647 929,846 520,000 50,000 After 2 but within 5 years 406,120 762,580 269,579 520,000 After 5 years - 263,488 - 263,488 1,937,767 1,955,914 789,579 833,488

Included in loans payables after 1 year but within 2 years are unsecured loans of $819,831,000 (2007: $809,836,000) due to related companies by the Group.

There are no unsecured loans due by the Company to related companies (2007: Nil).

Interest rates (per annum) on the Group’s borrowings, except for borrowings under MTN Programme and Convertible Bond are as follows: 2008 2007 Lowest Highest Lowest Highest % % % %

Secured bank borrowings denominated in: Singapore dollar 1.97 3.71 3.17 4.14 Thai baht 7.00 7.50 7.13 8.00 Renminbi 5.40 5.67 - -

Unsecured bank borrowings denominated in: Singapore dollar 1.46 3.40 2.87 4.17 Indonesian rupiah 8.70 14.88 9.64 9.67

Unsecured loans from related companies denominated in: Singapore dollar 1.14 3.26 1.83 4.10 United States dollar 1.02 5.69 4.99 6.45 Thai baht - - 5.84 19.59 Hong Kong dollar 1.55 4.10 - -

Keppel Land Limited 176 Report to Shareholders 2008 15. Fixed Assets Long Freehold Leasehold machinery, Land and Land and Equipment Building Buildings and Vehicles Total $’000 $’000 $’000 $’000

Group Cost At 1 January 2008 177 263,429 127,135 390,741 Additions - 1,798 11,247 13,045 Disposals - - (3,418) (3,418) Cost adjustment - - (28) (28) Reclassification (21) - 21 - Transfer from development properties - 15,251 98 15,349 Exchange differences on consolidation - 8,175 3,135 11,310 At 31 December 2008 156 288,653 138,190 426,999

Accumulated Depreciation and Impairment At 1 January 2008 119 128,891 113,314 242,324 Depreciation charge 5 3,915 3,779 7,699 Disposals - - (3,372) (3,372) Cost adjustment - - 79 79 Reclassification (20) - 20 - Exchange differences on consolidation - 3,738 2,650 6,388 At 31 December 2008 104 136,544 116,470 253,118

Net Carrying Amount 52 152,109 21,720 173,881

Cost At 1 January 2007 178 276,694 133,087 409,959 Additions - 2,034 5,712 7,746 Disposals - (565) (1,738) (2,303) Cost adjustment - - (3,473) (3,473) Transfer from development properties - 717 - 717 Exchange differences on consolidation (1) (15,451) (6,453) (21,905) At 31 December 2007 177 263,429 127,135 390,741

Accumulated Depreciation and Impairment At 1 January 2007 115 84,042 120,665 204,822 Depreciation charge 5 6,215 3,433 9,653 Disposals - (141) (1,523) (1,664) Impairment - 45,950 50 46,000 Cost adjustment - 9 (3,162) (3,153) Exchange differences on consolidation (1) (7,184) (6,149) (13,334) At 31 December 2007 119 128,891 113,314 242,324

Net Carrying Amount 58 134,538 13,821 148,417

In 2007, due to the continued political uncertainty in Myanmar, the Group made an additional impairment charge of $46,000,000 in the Group’s profit and loss account to fully write down the value of the two hotels in Yangon and Mandalay.

Notes to the Financial Statements 177 Notes to the Financial Statements

15. Fixed Assets (continued) Freehold Land and Building $’000

Company Cost At 1 January 2008 and at 31 December 2008 156

Accumulated Depreciation At 1 January 2008 99 Depreciation charge 5 At 31 December 2008 104

Net Carrying Amount 52

Cost At 1 January 2007 and at 31 December 2007 156

Accumulated Depreciation At 1 January 2007 94 Depreciation charge 5 At 31 December 2007 99

Net Carrying Amount 57

Keppel Land Limited 178 Report to Shareholders 2008 16. Investment Properties Long Freehold Leasehold Land and Land and Building Buildings Total $’000 $’000 $’000

Group Valuation At 1 January 2008 38,234 1,340,081 1,378,315 Development expenditure - 80,508 80,508 Fair value loss - (2,344) (2,344) Write-off to profit and loss accounts - (380) (380) Transfer to properties held for sale - (11,435) (11,435) Exchange differences on consolidation (36) (11,676) (11,712) At 31 December 2008 38,198 1,394,754 1,432,952

At 1 January 2007 34,534 1,165,188 1,199,722 Development expenditure - 25,688 25,688 Fair value gain 3,900 164,846 168,746 Disposals - (415) (415) Exchange differences on consolidation (200) (15,226) (15,426) At 31 December 2007 38,234 1,340,081 1,378,315

The Group’s investment properties (including integral plant and machinery) are stated at Directors’ valuation based on the following valuations (open market value basis) by independent firms of professional valuers as at 31 December 2008:

(a) Colliers International Consultancy & Valuation (Singapore) Pte Ltd for properties in Singapore;

(b) CB Richard Ellis (Vietnam) Co. Ltd for properties in Vietnam; and

In determining the fair value, the valuers have used valuation techniques which involve certain estimates. In relying on the valuation reports, Management has exercised its judgement and is satisfied that the valuation methods and estimates are reflective of current market conditions.

The fair values are based on open market values, being the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer and willing seller in arm’s length transaction wherein the parties had each acted knowledgeably and without compulsion.

The valuers have considered valuation techniques including direct comparison method, capitalisation approach and/or discounted cash flows in arriving at the open market value as at the balance sheet date.

The direct comparison method involves the analysis of comparable sales of similar properties and adjusting the sale prices to that reflective of the investment properties. The capitalisation approach capitalises an income stream into a present value using revenue multipliers or single-year capitalisation rates. The discounted cash flow method involves the estimation and projection of an income stream over a period and discounting the income stream with an internal rate of return to arrive at the market value.

Based on these valuations, the Group’s share of revaluation loss (after provision for deferred tax) amounted to $1,676,000 (2007: revaluation surplus of $106,695,000) and was taken to profit and loss account in accordance with FRS 40.

Properties amounting to $1,113,226,000 (2007: $311,500,000) in value and included in the above balances were mortgaged to banks as securities for borrowings referred to in Notes 14 and 28.

Interest capitalised during the year was $1,219,000 (2007: $1,158,000).

Notes to the Financial Statements 179 Notes to the Financial Statements

17. Properties Held for Development Group 2008 2007 $’000 $’000

Properties held for development comprise: Land costs 105,875 101,197 Development costs incurred 68,906 71,460 174,781 172,657

Properties held for development are transferred to fixed assets or investment properties when the respective developments are completed.

18. Amounts owing by Associated Companies Group 2008 2007 $’000 $’000

Amounts owing by associated companies 813,824 737,182

The amounts owing by associated companies are unsecured advances which have no fixed terms of repayment and are not expected to be repaid in the next 12 months. These advances are charged at rates ranging from 2.30% to 3.41% (2007: 3.42% to 4.28%) per annum and are denominated in Singapore dollars.

19. Subsidiary Companies Company 2008 2007 $’000 $’000

Quoted shares, at cost (Market value $169,826,000; 2007: $133,652,000) 257,515 127,615 Unquoted shares, at cost 1,247,036 1,177,242 1,504,551 1,304,857 Impairment (271,331) (196,575) 1,233,220 1,108,282

The following subsidiary company was acquired by the Group during the financial year:

Effective Interest After Net Assets Name of subsidiary company Acquisition Acquired Consideration $’000 $’000

Sunseacan Investment (HK) Company Limited 80% 1,400 1,400

The fair value of the assets acquired is disclosed in the consolidated cash flow statement.

The total consideration for the 80% equity interest in Sunseacan Investment (HK) Company Limited was paid in cash in May 2008.

Loss of acquired subsidiary company from the date of acquisition to 31 December 2008 amounted to $331,000. There is no material impact to Group’s revenue and attributable profit before exceptional items if the acquisitions had occurred on 1 January 2008.

Impairment loss is determined by reference to the financial conditions of the subsidiary companies. During the year, the impairment loss for certain subsidiary companies amounted to $74,756,000 (2007: $39,845,000).

The details of the subsidiary companies incorporated during the financial year are disclosed in Note 37.

Keppel Land Limited 180 Report to Shareholders 2008 20. Associated Companies Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Investment, at cost 761,992 500,997 143,660 143,660 Share of post-acquisition reserves: Revenue reserves (Distributable) 374,468 337,626 - - Capital and other reserves (Non-distributable) 1,497 5,315 - - Unrealised surplus on corporate restructuring (178,526) (178,526) - - Investment in associated companies 959,431 665,412 143,660 143,660 Impairment - - (18,340) (18,340) 959,431 665,412 125,320 125,320

Investment in associated companies is represented by: Quoted shares (Market value: $201,490,000; 2007: $220,511,000) 668,207 406,293 - - Unquoted shares 291,224 259,119 143,660 143,660 959,431 665,412 143,660 143,660

The Group’s share of profit for the year: 2008 2007 $’000 $’000

Profit before taxation 68,127 93,856 Taxation (see Note 9) (13,782) (20,054) Profit after taxation 54,345 73,802

The Group’s share of associated companies’ fair value gain on investment properties amounted to $6,811,000 (2007: $288,306,000) and the Group’s share of related provision for deferred tax was $1,465,000 (2007: $51,430,000).

The summarised financial information of the associated companies on a 100% basis is as follows: 2008 2007 $’000 $’000

Total assets 8,462,639 7,964,982 Total liabilities (5,379,991) (5,527,254) Revenue for the year 657,280 1,050,582 Profit for the year 166,637 206,274

21. Long-term Investments Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Quoted shares in corporations, at market value 60 6,291 - - Unquoted shares in corporations 4,416 4,732 4,387 4,677 Private property fund 56,460 45,926 - - 60,936 56,949 4,387 4,677

Notes to the Financial Statements 181 Notes to the Financial Statements

22. Properties Held for Sale Group 2008 2007 $’000 $’000

(a) Properties under Development: Land cost 1,066,454 1,491,200 Development cost incurred to-date 905,349 1,124,793 Related overhead expenditure 219,486 417,493 Development profit 444,090 390,659 Progress billings received and receivable (1,240,684) (1,988,013) Provision for foreseeable losses (64,079) (106,350) 1,330,616 1,329,782

Analysis of provision for foreseeable losses: At 1 January (106,350) (306,730) Transfer to completed properties held for sale - 19,437 Provisions written back 23,144 86,248 Provisions utilised 19,127 94,695 At 31 December (64,079) (106,350)

(b) Completed Properties Held for Sale 152,086 101,452 Provision for foreseeable losses (8,108) (9,565) 143,978 91,887

Analysis of provision for foreseeable losses: At 1 January (9,565) (22,218) Transfer from properties under development - (19,437) Provisions written back 1,472 23,166 Provisions utilised - 8,924 Exchange differences on consolidation (15) - At 31 December (8,108) (9,565)

1,474,594 1,421,669

Interest capitalised during the year was $17,113,000 (2007: $52,167,000) at rates ranging from 1.64% to 3.50% (2007: 2.78% to 4.44%) per annum for Singapore properties and 1.23% to 21.00% (2007: 1.62% to 10.05%) per annum for overseas properties.

Properties amounting to $450,949,000 (2007: $370,913,000) in value and included in the above balances were mortgaged to banks as securities for borrowings as referred to in Notes 14 and 28.

23. Stocks Group 2008 2007 $’000 $’000

Spare parts and consumable stores 3,620 3,550

Keppel Land Limited 182 Report to Shareholders 2008 24. Debtors Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

(a) Trade Debtors: Not past due 50,543 53,522 - - Past due but not impaired 20,802 40,103 - - 71,345 93,625 - - Allowance for doubtful debts (782) (2,379) - - 70,563 91,246 - -

(b) Other Debtors: Deposits paid 3,032 2,083 - - Interest receivable 15,982 11,753 - - Advances to corporations in which the Group has investment interests 254 17,425 - - Advances to minority shareholders of subsidiary companies 33,131 12,830 - - Advances to joint venture partners 52,080 - - - Other debtors 19,143 17,820 - - Other recoverable amounts 57,217 28,306 3 361 180,839 90,217 3 361 Allowance for doubtful debts (23,499) (19,588) - - 157,340 70,629 3 361

253,815 196,317 378 1,007

Trade debtors that are past due but not impaired: Past due < 3 months and not impaired 10,494 20,577 - - Past due 3 – 6 months and not impaired 1,801 4,855 - - Past due > 6 months and not impaired 8,507 14,671 - - 20,802 40,103 - -

Analysis of allowance for doubtful debts – Trade: At 1 January 2,379 4,326 - - Write-back for the year (243) (46) - - Write-off against provision (1,329) (1,865) - - Exchange differences on consolidation (25) (36) - - At 31 December 782 2,379 - -

Analysis of allowance for doubtful debts – Non-trade: At 1 January 19,588 16,837 - - Charge for the year 3,863 3,113 - - Exchange differences on consolidation 48 (362) - - At 31 December 23,499 19,588 - -

Notes to the Financial Statements 183 Notes to the Financial Statements

24. Debtors (continued)

Advances to corporations in which the Group has investment interests are unsecured, have no fixed terms of repayment and are interest-free. These advances represent mainly the Group’s interest in the underlying property development projects undertaken by a Singapore corporation.

Advances to minority shareholders are unsecured, have no fixed terms of repayment and are interest-free.

Debtors are denominated in the following currencies: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 67,230 112,035 378 1,007 United States dollar 82,244 9,103 - - Renminbi 51,724 16,754 - - Indian rupee 17,505 30,585 - - Indonesian rupiah 10,964 9,412 - - Others 24,148 18,428 - - 253,815 196,317 378 1,007

25. Amounts Owing by/to Holding Company and Related Parties Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Advances owing by: Subsidiary companies - - 1,632,418 1,863,699 Associated companies 139,243 141,093 2,907 2,907 Related companies 8,647 6,404 5,796 4,747

Current accounts owing by holding and related companies - - - 17 147,890 147,497 1,641,121 1,871,370

Advances owing to: Subsidiary companies - - 108,110 403,124 Associated companies 67,986 66,796 58,297 57,057

Current account owing to holding and related companies 4,101 15,015 - - 72,087 81,811 166,407 460,181

The advances owing by/to subsidiary companies are non-trade related, unsecured and have no fixed terms of repayment. Interest-bearing advances of $1,132,808,000 (2007: $1,830,562,000) to subsidiary companies are charged at rates ranging from 1.1% to 4.78% (2007: 1.37% to 4.78%) per annum.

The advances owing by/to associated companies are non-trade related, unsecured and have no fixed terms of repayment. Interest-bearing advances of $29,400,000 (2007: $79,593,000) are charged at rates ranging 0.36% to 7.23% (2007: 7.77% to 15%) per annum.

Keppel Land Limited 184 Report to Shareholders 2008 The advances owing by subsidiary companies are denominated in the following currencies: Company 2008 2007 $’000 $’000

Singapore dollar 1,600,202 1,837,423 United States dollar 27,039 26,276 Others 5,177 - 1,632,418 1,863,699

The advances owing to subsidiary companies are denominated in the following currencies: Company 2008 2007 $’000 $’000

Singapore dollar 14,898 314,281 United States dollar 89,280 86,940 Others 3,932 1,903 108,110 403,124

Advances owing by related companies are interest-free, unsecured, have no fixed terms of repayment and are denominated in the following currencies: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 4,802 2,981 3,533 2,243 United States dollar 2,257 2,517 2,253 2,504 Hong Kong dollar 1,565 898 - - Others 23 8 10 - 8,647 6,404 5,796 4,747

Current accounts owing by/to holding and related companies are largely denominated in Singapore dollar.

Notes to the Financial Statements 185 Notes to the Financial Statements

26. Cash and Cash Equivalents Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Fixed deposits with banks 339,221 411,594 - - Bank balances and cash 138,883 229,405 2,922 929 Deposits with related companies 148,257 546,306 4,246 10,051 626,361 1,187,305 7,168 10,980

Cash and cash equivalents are denominated in the following currencies: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 207,503 654,082 2,889 4,750 Renminbi 212,944 345,327 - - United States dollar 97,042 111,025 3,461 5,248 Vietnamese dong 46,346 31,538 - - Indonesian rupiah 16,691 7,937 - - Philippines peso 15,233 18,129 - - Indian rupee 13,242 16,031 - - Others 17,360 3,236 818 982 626,361 1,187,305 7,168 10,980

Fixed deposits with banks and related companies mature in varying periods of between 1 day to 12 months (2007: 1 day to 12 months) from the financial year-end. Fixed deposits with banks during the year bear interest at the following rates per annum: 2008 2007 Lowest Highest Lowest Highest % % % %

Singapore dollar 0.11 2.14 1.44 2.14 United States dollar 1.00 7.10 3.85 4.35 Renminbi 1.35 3.78 1.62 2.07 Vietnamese dong 2.40 18.00 6.30 8.28 Indian rupee 2.50 7.50 3.25 3.25 Indonesian rupiah 4.40 12.15 4.40 7.75

Interest rates on deposits with related companies are disclosed in Note 4. Group 2008 2007 $’000 $’000

(a) Amounts held under Project Account Rules 1985, withdrawals from which are restricted to payments for expenditures incurred on projects 41,022 120,411

(b) Amounts held in escrow accounts for the acquisition of land overseas, payment of construction costs and progress billings received 34,364 22,149

Keppel Land Limited 186 Report to Shareholders 2008 27. Creditors Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Trade creditors 107,611 101,035 - - Loans from minority shareholders of certain subsidiary companies 214,445 197,435 - - Income support payable to an associated company 77,323 98,017 - - Accrual for staff costs 28,265 35,314 - - Retention monies 30,113 28,978 - - Deposits received 23,940 19,275 - - Interest payable 10,123 14,213 2,754 7,729 Accrual for development costs and other payables 306,767 368,431 17,428 4,688 798,587 862,698 20,182 12,417

The loans from the minority shareholders of certain subsidiary companies are unsecured and have no fixed terms of repayment. Interest-bearing loans from the minority shareholders amounted to $204,037,000 (2007: $121,822,000) and interest is payable at rates ranging from 2.00% to 18.59% (2007: 2.78% to 12.06%) per annum.

Creditors are denominated in the following currencies: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 456,365 471,866 19,543 10,640 Renminbi 182,973 199,898 - - United States dollar 75,680 67,804 639 639 Indonesian rupiah 31,069 84,914 - - Vietnamese dong 17,843 12,471 - - Indian rupee 12,136 20,201 - - Others 22,521 5,544 - 1,138 798,587 862,698 20,182 12,417

Notes to the Financial Statements 187 Notes to the Financial Statements

28. Short-term Borrowings Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Unsecured borrowings under MTN Programme 108,500 192,250 108,500 192,250

Unsecured loans from related company 371 6,876 - -

Bank borrowings: Secured 38,256 5,880 - - Unsecured 36,924 113,856 - - 75,180 119,736 - -

184,051 318,862 108,500 192,250

Unsecured borrowings under MTN Programme bear interest at rates ranging from 1.10% to 3.40% (2007: 2.3% to 4.18%) per annum, repayable within 1 year and are repriced within 3 to 6 months.

Secured bank borrowings as at 31 December 2008 bear interest at rates ranging from 1.64% to 5.40% per annum, and are secured by mortgages of properties held by subsidiary companies and a standby letter of credit issued by a leading bank in Singapore. The secured bank borrowing as at 31 December 2007 was charged interest at a fixed rate of 5.83% per annum. The security was a standby letter of credit issued by a leading bank in Singapore and it was repaid in 2008.

Unsecured bank borrowings are repriced within 1 week to 12 months.

Interest rates (per annum) on the Group’s unsecured loans from related company and unsecured bank borrowings are as follows: 2008 2007 Lowest Highest Lowest Highest % % % %

Unsecured loans from related company denominated in: Singapore dollar 1.23 3.08 2.95 3.38 United States dollar 3.02 5.10 5.02 6.00

Unsecured bank borrowings denominated in: United States dollar - - 5.45 5.45 Renminbi 6.56 7.20 6.56 6.56 Indian rupee 9.60 14.00 8.50 10.15 Vietnamese dong 11.50 21.00 - -

Short-term borrowings are denominated in the following currencies: Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Singapore dollar 141,376 194,056 108,500 192,250 Renminbi 27,451 25,480 - - Vietnamese dong 13,685 - - - Indian rupee 1,539 7,316 - - United States dollar - 92,010 - - 184,051 318,862 108,500 192,250

Keppel Land Limited 188 Report to Shareholders 2008 29. Segment Reporting

(a) Business Segment Sales Profit before Taxation Attributable Profit Assets Employed 2008 2007 2008 2007 2008 2007 2008 2007 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Property trading 675,124 1,238,951 229,099 380,781 160,018 274,938 3,030,627 2,786,037

Property investment 70,275 62,547 57,841 33,749 46,643 30,905 1,866,410 1,503,208

Fund management 36,493 30,034 25,606 17,453 21,127 14,138 92,839 82,547

Hotel and resorts, property services, and others 60,274 76,354 (13,701) (46,256) (14,507) (40,601) 28,876 546,675

842,166 1,407,886 298,845 385,727 213,281 279,380 5,018,752 4,918,467

Corporate restructuring surplus - - - 235,230 - 235,230 - -

Fair value gain on investment properties/ impairment - - 4,467 367,779 3,670 265,040 - -

Gain on acquisition of additional interest in an associated company - - 10,718 - 10,718 - - -

842,166 1,407,886 314,030 988,736 227,669 779,650 5,018,752 4,918,467

Notes to the Financial Statements 189 Notes to the Financial Statements

29. Segment Reporting (continued) (b) Geographical Segment 2008 2007 Other Consolidated Other Consolidated Singapore Countries Total Singapore Countries Total $’000 $’000 $’000 $’000 $’000 $’000

Sales 504,965 337,201 842,166 742,296 665,590 1,407,886

Results Operating profit 168,604 63,140 231,744 159,472 152,797 312,269 Investment income 9,353 - 9,353 608 210 818 Net interest income/ (expense) (16,007) 5,628 (10,379) (18,354) (2,862) (21,216) Share of results of associated companies 57,732 10,395 68,127 78,076 15,780 93,856 Gain on acquisition of additional interest in an associated company 10,718 - 10,718 - - - Corporate restructuring surplus - - - 235,230 - 235,230 Fair value gain on investment properties/impairment 3,317 1,150 4,467 435,696 (67,917) 367,779

Profit before taxation 233,717 80,313 314,030 890,728 98,008 988,736 Taxation (34,424) (10,230) (44,654) (95,815) (56,037) (151,852)

Profit after taxation 199,293 70,083 269,376 794,913 41,971 836,884 Minority interests (36,282) (5,425) (41,707) (59,545) 2,311 (57,234)

Attributable profit 163,011 64,658 227,669 735,368 44,282 779,650

Assets and Liabilities Segment assets 2,876,849 2,285,805 5,162,654 3,411,637 2,038,221 5,449,858 Investment in associated companies 775,508 183,923 959,431 499,015 166,397 665,412

Total assets 3,652,357 2,469,728 6,122,085 3,910,652 2,204,618 6,115,270

Segment liabilities 406,921 463,753 870,674 444,388 500,121 944,509 Net tax provision and deferred taxation 162,601 70,058 232,659 125,235 127,059 252,294

569,522 533,811 1,103,333 569,623 627,180 1,196,803

Assets employed 3,082,835 1,935,917 5,018,752 3,341,029 1,577,438 4,918,467 Unallocated liabilities 2,121,818 2,274,776

Net tangible assets 2,896,934 2,643,691

Other Segmental Information: Purchase of fixed assets and expenditure on investment properties 81,915 11,638 93,553 26,587 6,847 33,434 Depreciation charge 1,289 6,410 7,699 1,330 8,323 9,653

Keppel Land Limited 190 Report to Shareholders 2008 30. Capital and Lease Commitments Group 2008 2007 $’000 $’000

(a) Estimated development costs for properties for sale: (i) Contracted for 813,103 408,651 (ii) Not contracted for 228,030 1,376,145 1,041,133 1,784,796 Minority interests (199,994) (393,455) 841,139 1,391,341

(b) Estimated funding in associated companies 1,425,713 1,298,277

(d) Operating lease commitments are as follows: The Group has entered into commercial property leases on its investment properties. The future minimum rental income receivable under significant non-cancellable leases is as follows: Group 2008 2007 $’000 $’000

Within 1 year 53,359 47,216 Between 2 and 5 years 37,873 46,492 After 5 years 44,264 36,874 135,496 130,582

Generally, the Group’s non-cancellable leases are for terms of 3 years.

31. Contingent Liabilities, Unsecured Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Unsecured guarantees given to financial institutions in connection with facilities given to: (a) Subsidiary companies - - 3,581 5,880 (b) Associated companies 8,110 10,861 - 292 (c) Certain end-purchasers of overseas residential properties 7,624 2,032 - - Minority interests (3,582) (32) - - 4,042 2,000 - -

No material losses under these guarantees are expected.

Notes to the Financial Statements 191 Notes to the Financial Statements

32. Significant Related Party Transactions (a) Significant related party transactions entered into by the Group with the holding company and related parties are as follows: 2008 2008 2007 2007 $’000 $’000 $’000 $’000 With Holding With With Holding With Company Group’s Company Group’s and Related Associated and Related Associated Companies Companies Companies Companies

Interest income 801 23,758 2,189 39,998 Interest expense: Charged to profit and loss account (7,862) - (12,371) - Capitalised under development cost (9,207) - (46,150) - Management fees paid (2,963) - (5,276) - Rental expense (2,879) - (2,114) - Project and development management fees received 3,111 - 6,834 - Property management fees received 1,833 82 1,289 70 Marketing commission received 2,736 4,275 19,931 5,189 Management and support services 862 368 2,554 392 Asset management fees 12,892 - 10,770 - Other products and services (1,211) - (634) -

(b) Transactions entered into by the Group with the Temasek Group:

2008 2007 $’000 $’000

Management fees paid (416) (486)

2008 2007 $’000 $’000

Consideration for the sale of units in Singapore and overseas residential developments to Directors of the Company and their immediate family members at prevailing prices applicable to third parties - 4,709

The related party transactions in (a) and (b) above are entered into in the normal course of business based on negotiated arm’s length prices.

Keppel Land Limited 192 Report to Shareholders 2008 33. Financial Risk Management The Group operates primarily in Singapore, China, Vietnam, India and Indonesia and is exposed to a variety of financial risks pertaining to changes in interest rates, fluctuations in currency exchange rates, credit and liquidity risks. The Group’s overall risk management strategy seeks to minimise the adverse effects from the unpredictability of financial markets on the Group profit. The Group uses financial instruments such as currency forwards, interest rate swaps, interest rate caps and foreign currency borrowings to hedge certain financial risk exposures.

Assessment of financial risks is carried out regularly by Management and reported to the Board Risk Committee, which will review and guide Management on the Group’s risk profile, risk identification, management of significant risks, risk mitigation strategies and risk policies.

The risk management policies are summarised as follows:

(a) Interest Rate Risk The Group’s exposure to changes in interest rates is in respect of debt obligations and deposits with related companies and financial institutions.

The interest rate management policy is aimed at optimising net interest cost and reducing volatility. The Group borrows a mix of fixed and variable rate debts with varying tenors, and also uses interest rate swaps and caps to hedge against changes in interest rates on the underlying debt obligations.

As at 31 December 2008, the Group has no outstanding agreements with financial institutions for interest rate swaps or caps.

Sensitivity Analysis for Interest Rate Risk:

The Group’s borrowings at variable rates on which effective hedges have not been entered into, are denominated mainly in Singapore dollar (“SGD”) and United States dollar (“USD”). If interest rates increase/decrease by 0.5% (2007: 0.5%) with all other variables, including tax rate, being held constant, the Group’s profit after taxation will be lower/higher by $7,432,000 (2007: $7,713,000).

(b) Foreign Currency Risk Foreign currency risk arises when transactions are denominated in currencies other than the respective functional currencies of the various entities in the Group, and such changes will impact the Group profit.

There is no outstanding forward contract at 31 December 2008. As at 31 December 2007, the Group had outstanding forward foreign contracts of nominal USD 6,200,000 and Euro 1,000,000 to hedge its risk in respect of management fees receivable in these currencies. The derivative asset on these forward contracts was negligible.

In addition, the Group is exposed to foreign currency movements on its net investment in foreign subsidiary and associated companies, which generate revenue and incur costs denominated in foreign currencies; and such changes impact the results and reserves of the Group. This currency exposure is, as practicable as possible, managed through borrowings in the same currencies in which the assets are denominated.

Notes to the Financial Statements 193 Notes to the Financial Statements

33. Financial Risk Management (continued) (b) Foreign Currency Risk The carrying amounts of significant financial assets and financial liabilities denominated in currencies other than the functional currencies of the respective entities are as follows:

2008 2007 united United States Indonesian Indian Vietnamese States Indonesian Indian Vietnamese Dollar renminbi rupiah rupee Dong Dollar Renminbi Rupiah Rupee Dong (USD) (RMB) (IDR) (INR) (VND) (USD) (RMB) (IDR) (INR) (VND) $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Financial assets Debtors 27,896 498 1,038 - 7,367 5,131 699 - - - Cash and cash equivalents 34,652 160 1,765 121 46,346 29,673 - 824 40 -

Financial liabilities Creditors (45,660) (50) (1,611) - (17,843) (40,751) - (2,803) - - Borrowings - - - - (13,685) (86,940) - - - -

Sensitivity Analysis for Currency Risk:

If the relevant foreign currencies change against SGD by 5% (2007: 5%) with all other variables, including tax rate, being held constant, the effect arising from the net financial assets/liabilities position will be as follows:

2008 2007 Profit after Taxation Increase / (Decrease)

USD against SGD - strengthened 845 (4,644) - weakened (845) 4,644

RMB against SGD - strengthened 30 35 - weakened (30) (35)

IDR against SGD - strengthened 60 (99) - weakened (60) 99

INR against SGD - strengthened 6 2 - weakened (6) (2)

VND against SGD - strengthened 1,109 - - weakened (1,109) -

(c) Credit Risk Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations.

Keppel Land Limited 194 Report to Shareholders 2008 Trade debtors comprise mainly the Group’s customers who bought residential units and tenants of commercial properties.

Bank deposits are mainly deposits with banks that meet appropriate credit criteria.

The following situations may give rise to credit risk:

(i) That the tenants of investment properties and purchasers of development properties may default on their obligations to pay the amounts owing to the Group.

a) For investment properties, the Group manages credit risks arising from tenants defaulting on their rental by requiring the tenants to furnish cash deposits, and/or banker’s guarantees. The Group also has a policy of regular review of debt collection and rental contracts are entered into with customers with an appropriate credit history.

b) For trading properties, the Group generally has the following recourse: - Forfeiture of instalments paid and re-sale of the re-possessed properties; and - Claim against the purchasers for any shortfall from the re-sale.

(ii) That a counterparty will default on its contractual obligations under financial instrument contracts resulting in financial loss to the Group. It is generally limited to the amounts, if any, by which the counterparty’s obligations exceed the obligations of the Group. It is also the Group’s policy to enter into financial instrument contracts with a diversity of prime financial institutions.

The maximum exposure to credit risk is the carrying amount of financial assets which are mainly trade debtors, amounts owing by holding company and related parties, and cash and cash equivalents.

(d) Liquidity Risk Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial obligations due to shortage of funds. The Group manages the liquidity risk by maintaining sufficient cash, internally generated cashflows, and the availability of funding resources through adequate committed credit facilities. The Group also maintains a mix of short-term money market borrowings as well as the ability to tap the capital market through the MTN Programme to fund working capital requirements and capital expenditure/investments.

Information relating to the maturity profile of loans is given in Notes 14 and 28.

(e) Capital Management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and to maintain an optimal capital structure so as to maximise shareholder value. In order to maintain or achieve an optimal capital structure, the Group may adjust the amount of dividend payment, return capital to shareholders, issue new shares, buy back issued shares, obtain new borrowings or sell assets to reduce borrowings.

Management monitors capital based on the gearing ratio, which is calculated as net debt divided by total capital. Net debt is calculated as borrowings less cash and cash equivalents, and total capital is calculated as equity including minority interests in subsidiary companies. Group Company 2008 2007 2008 2007 $’000 $’000 $’000 $’000

Net debt 1,495,457 1,087,471 890,911 1,014,758 Total capital 2,896,934 2,643,691 1,911,347 1,609,054 Gearing ratio 52% 41% 47% 63%

Notes to the Financial Statements 195 Notes to the Financial Statements

34. Fair Value of Financial Assets and Liabilities The carrying amounts of the following financial assets and liabilities of the Group and Company approximate their fair values due to their short-term nature: Cash and cash equivalents, debtors, creditors and amounts owing by/to related companies.

The fair values of the short-term and long-term borrowings as at 31 December 2008 are as stated below. They are estimated using discounted cash flow analysis based on current rates for similar types of borrowing arrangements.

2008 2007

Group Company Group Company Carrying Fair Carrying Fair Carrying Fair Carrying Fair Amount Value Amount Value Amount Value Amount Value $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Short-term borrowings 184,051 184,057 108,500 108,506 318,862 318,788 192,250 192,176

Long-term borrowings 1,937,767 1,957,901 789,579 809,713 1,955,914 1,975,331 833,488 852,905

Amounts owing by associated companies are charged at floating interest rates and their carrying amounts approximate their fair values.

35. Comparatives The following comparative amounts for the Group as at 31 December 2007 have been reclassified to conform with current year’s presentation: As Previouly As reported reclassified $’000 $’000

Consolidated Profit and Loss Account Cost of sales 984,442 985,324 Distribution costs (4,325) (17,310) Administrative and other expenses (106,850) (92,983)

Balance Sheet Non Current Assets Amount owing by associated companies - 737,182

Current Assets Amount owing by associated companies 884,679 147,497

Keppel Land Limited 196 Report to Shareholders 2008 36. Future Changes in Accounting Policies (a) Financial Reporting Standards (“FRS”) The Group has not adopted the following FRS and INT FRS that have been issued but not yet effective:

reference Description Effective for annual periods beginning on or after

INT FRS 113 Customer Loyalty Programmes 1 July 2008 FRS 1 - Presentation of Financial Statements – Revised Presentation 1 January 2009 - Presentation of Financial Statements – Amendments relating to Puttable Financial Instruments and Obligations Arising on Liquidation 1 January 2009 FRS 23 Borrowing Costs 1 January 2009 FRS 32 Financial Instruments: Presentation – Amendments relating to Puttable Financial Instruments and Obligations Arising on Liquidation 1 January 2009 FRS 102 Share-based Payment – Vesting Conditions and Cancellations 1 January 2009 FRS 108 Operating Segments 1 January 2009

The Directors expect that the adoption of the above pronouncements will have no material impact on the financial statements in the period of initial application, except for FRS 1 and FRS 108 as indicated below:

FRS 1 Presentation of Financial Statements – Revised Presentation

The revised FRS 1 requires owner and non-owner changes in equity to be presented separately. The statement of changes in equity will include only details of transactions with owners, with all non-owner changes in equity presented as a single item. In addition, the revised standard introduces the statement of comprehensive income: it presents all items of income and expense recognised in profit or loss, together with all other items of recognised income and expense, either in one single statement, or in two linked statements.

FRS 108 Operating Segments

FRS 108 supersedes FRS 14 (Segment Reporting) and requires the Group to report the financial performance of its operating segments based on the information used internally by Management for evaluating segment performance and deciding on allocation of resources. Such information may be different from the information included in the financial statements, and the basis of its preparation and reconciliation to the amounts recognised in the financial statements shall be disclosed.

The Group will apply FRS 108 from 1 January 2009 and provide comparative information that conforms to the requirements of FRS 108. Adoption of this standard will have no impact on the financial position and results of the Group when implemented in 2009.

Notes to the Financial Statements 197 Notes to the Financial Statements

36. Future Changes in Accounting Policies (continued) (b) International Financial Reporting Interpretations Committee (“IFRIC”) Interpretation and recommended Accounting Practice (“RAP”) The International Accounting Standards Board issued IFRIC Interpretation 15 in July 2008 which becomes effective for financial years beginning on or after 1 January 2009. When adopted, the interpretation is to be applied retrospectively. It clarifies when and how revenue and related expenses from the sale of a real estate unit should be recognised if an agreement between a developer and a buyer is reached before construction of the real estate is completed. Furthermore, the interpretation provides guidance on how to determine whether an agreement is within the scope of FRS 11 (Construction Contract) or FRS 18 (Revenue).

RAP 11 Pre-Completion Contracts for the Sale of Development Property

RAP 11 is still applicable in Singapore as IFRIC Interpretation 15 has not been adopted by the Accounting Standards Council. It was issued by the Institute of Certified Public Accountants of Singapore in October 2005. In the RAP, it is mentioned that a property developer’s sales and purchase agreement is not a construction contract as defined in FRS 11 (Construction Contract) and the percentage of completion (“POC”) method of recognising revenue, which is allowed under FRS 11 for construction contract, may not be applicable for property developers. The relevant standard for revenue recognition by property developers is FRS 18 (Revenue), which addresses revenue recognition generally for all types of entities. However, there is no clear conclusion in FRS 18 whether the POC method or the completion of construction (“COC”) method is more appropriate for property developers.

The Group uses the POC method for recognising revenues from partly completed residential projects which are held for sale. Had the COC method been adopted, the impact on the financial statements will be as follows:

Group 2008 2007 $’000 $’000

Increase/(decrease) in revenue recognised for the year 595,619 (339,645)

Decrease in opening revenue reserve (349,789) (154,546)

Increase/(decrease) in profit for the year 109,747 (195,243)

Decrease in carrying value of properties held for sale: At 1 January (383,261) (195,546) At 31 December (274,396) (383,261)

Decrease in minority interests: At 1 January (39,726) (9,326) Share of profit for the year (42,272) (30,400)

37. Significant Group Companies Information relating to the significant subsidiary companies consolidated in these financial statements and to the associated companies whose results are included in the financial statements is given on pages 199 to 205.

Keppel Land Limited 198 Report to Shareholders 2008 Significant Subsidiary and Associated Companies For the financial year ended 31 December 2008

Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies Acresvale Investment Pte Ltd 100 100 Singapore Property development and investment Alpha Investment Partners Limited 100 100 Singapore Fund management Avenue Park Development Pte Ltd* 52 52 Singapore Property development Bayfront Development Pte Ltd* 100 100 Singapore Investment holding Bintan Bay Resort Pte Ltd* 90 90 Singapore Investment holding Boulevard Development Pte Ltd* 100 100 Singapore Investment holding BCH Office Investment Pte Ltd* 100 100 Singapore Investment holding Bukit Timah Hill Development Pte Ltd 100 100 Singapore Property development Castlehigh Pte Ltd 100 100 Singapore Investment holding Corredance Pte Ltd 100 100 Singapore Investment holding Dattson Pte Ltd 100 100 Singapore Investment holding D.L. Properties Ltd 65 65 Singapore Property investment Denton Investment Pte Ltd 100 100 Singapore Investment holding Devonshire Development Pte Ltd* 60 60 Singapore Property development Domenico Pte Ltd 100 - Singapore Investment holding (Acquired on 2.7.08) Dovesdale Development Pte Ltd 100 100 Singapore Investment holding Earlsbay Investment Pte Ltd 100 - Singapore Investment holding (Acquired on 30.1.08) Evergro Properties Limited 85 71 Singapore Property investment (71% up to 26.8.08) and development Elaenia Pte Ltd 100 100 Singapore Investment holding Evansville Investments Pte Ltd 100 100 Singapore Property development Experre Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Fernland Investment Pte Ltd 55 55 Singapore Investment holding Flannigan Investment Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Flemmington Investments Pte Ltd 100 - Singapore Investment holding (Acquired on 2.7.08) Floraville Estate Pte Ltd 100 100 Singapore Investment holding Glenville Estate Investment Pte Ltd 100 100 Singapore Investment holding Greenfield Development Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Hampshire Pte Ltd 100 100 Singapore Investment holding Harrisonburg Pte Ltd 100 100 Singapore Investment holding Harvestland Development Pte Ltd 100 100 Singapore Property development and investment High Point Development Pte Ltd 100 100 Singapore Investment holding Hillwest Pte Ltd 100 100 Singapore Investment holding K-REIT Asia Investment Pte Ltd* 100 100 Singapore Investment holding K-REIT Asia Management Limited 100 100 Singapore Property fund management

Notes to the Financial Statements 199 Significant Subsidiary and Associated Companies

Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies K-REIT Asia Property Management Pte Ltd 100 100 Singapore Property management services KeplandeHub Limited Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Keppel China Marina Holdings Pte Ltd 100 - Singapore Investment holding (Formerly known as Coral Vale Investments Pte Ltd) (Acquired on 30.1.08) Keppel China Township Development Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Keppel Digihub Holdings Ltd* 100 100 Singapore Investment, management and holding company Keppel Digihub Ltd* 100 100 Singapore Property investment Keppel Land (Arabia) Pte Ltd 100 100 Singapore Investment holding Keppel Land China Holdings Pte Ltd 100 100 Singapore Investment holding Keppel Land Financial Services Pte Ltd 100 100 Singapore Financial services Keppel Land International Limited Singapore Property services Ordinary Shares 100 100 Preference Shares 100 100 Keppel Land Investment (Hanoi) Pte Ltd 100 100 Singapore Investment holding Keppel Land Properties Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Keppel Land Realty Pte Ltd 100 100 Singapore Property development and investment Keppel Land (Tower D) Pte Ltd* 100 100 Singapore Property development and investment Kingsley Investment Pte Ltd 100 100 Singapore Investment holding Le-Vision Pte Ltd 100 100 Singapore Investment holding Mansfield Developments Pte Ltd 100 100 Singapore Investment holding Mansfield Realty Limited 100 100 Singapore Investment holding Meadowsville Investment Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Merryfield Investment Pte Ltd* 100 100 Singapore Investment holding Montfort Development Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Ocean & Capital Properties Pte Ltd* 100 100 Singapore Property/investment holding Ocean Properties Pte Ltd* 76 76 Singapore Property investment OIL (Asia) Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Palmsville Investment Pte Ltd 84 84 Singapore Investment holding

Keppel Land Limited 200 Report to Shareholders 2008 Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies Pasir Panjang Realty Pte Ltd 100 100 Singapore Investment holding Portsville Pte Ltd 100 100 Singapore Investment holding Prestige Landmark Pte Ltd 51 51 Singapore Investment holding Saigon Centre Holdings Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Sedona Corporate Residence Pte Ltd* 100 100 Singapore Property services Sedona Hotels International Pte Ltd 100 100 Singapore Hotel and resort management Sherwood Development Pte Ltd 100 100 Singapore Property development Silkland Investment Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Sophia International Pte Ltd 100 100 Singapore Investment holding Spring City Resort Pte Ltd Singapore Investment holding Ordinary Shares 100 100 Preference Shares 100 100 Straits Properties Limited 100 100 Singapore Property development and investment Straits Property Investments Pte Ltd 100 100 Singapore Investment holding Straits-CM Village Hotel Pte Ltd* 39 39 Singapore Investment holding Straits-KMP Resort Development Pte Ltd* 46 46 Singapore Investment holding Sunlake Development Pte Ltd 100 100 Singapore Investment holding Tat Chuan Development (Pte) Ltd 100 100 Singapore Property development Third Dragon Holdings Pte Ltd* 85 71 Singapore Investment holding (71% up to 26.8.08) Third Dragon Development Pte Ltd* 85 71 Singapore Investment holding (71% up to 26.8.08) and marketing agent VN Investment Pte Ltd 100 100 Singapore Investment holding Waterville Investment Pte Ltd 100 100 Singapore Investment holding Wiseland Investment Pte Ltd 100 100 Singapore Investment holding Wisley Pte Ltd 100 100 Singapore Investment holding Aintree Assets Ltd (H) 100 100 British Virgin Investment holding Islands / Asia Double Peak Holdings Ltd (H) British Virgin Investment holding Ordinary Shares 100 100 Islands Preference Shares 100 100 / Singapore Erskine Holdings Ltd* (H) 70 70 British Virgin Investment holding Islands / Hong Kong Jencity Ltd* (H) 90 90 British Virgin Investment holding Islands / Vietnam Pembury Properties Ltd* (H) 100 100 British Virgin Investment holding Islands / Singapore

Significant Subsidiary and Associated Companies 201 Significant Subsidiary and Associated Companies

Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies Red Vibrant Investments Ltd (H) 100 100 British Virgin Investment holding Islands / Vietnam Saigon Centre Investment Ltd* (H) 100 100 British Virgin Investment holding Islands / Hong Kong Southwick Developments Ltd (H) 100 100 British Virgin Investment holding Islands / China Vanese International Ltd* (H) 70 70 British Virgin Investment holding Islands / Hong Kong Alpha Investment Partners China Limited* 100 - China Provision of (Incorporated on 26.3.08) (G) investment management and consultancy services Beijing Kingsley Property Development 100 100 China Property development Co Ltd* (A) Changzhou Fushi Housing Development 85 71 China Property development Pte Ltd* (G) (71% up to 26.8.08) Chengdu Hillwest Development Co Ltd* (A) 100 100 China Property development Jiangyin Evergro Properties Co Ltd* (G) 76 70 China Property development (70% up to 26.8.08) Jiangyin Yangtze International Country Club 81 71 China Golf club operations Co Ltd* (G) and development (71% up to 26.8.08) Keppel Township Development (Shenyang) 100 100 China Property development Co Ltd* (A) Shanghai Floraville Land Co Ltd* (A) 99 99 China Property development Shanghai Hongda Property Development 99 99 China Property development Co Ltd* (A) Shanghai Merryfield Land Co Ltd* (A) 99 99 China Property development Shanghai Minghong Property Co Ltd* (A) 99 99 China Property development Shanghai Pasir Panjang Land Co Ltd* (A) 99 99 China Property development Sunsea Yacht Club (Zhongshan) Co. Ltd* 80 - China Development of marina (Acquired on 1.5.08) (A) lifestyle cum residential properties Tianjin Fushi Property Development Co Ltd* (G) 85 71 China Property development (71% up to 26.8.08) Tianjin Merryfield Property Development Co Ltd* (A) 100 100 China Property development Tianjin Pearl Beach International Country 85 71 China Golf course development Club Co Ltd* (G) (71% up to 26.8.08) Keppel Land (Saigon Centre) Ltd* (G) 100 100 Hong Kong Investment holding Sunseacan Investment (HK) Company Limited* 80 - Hong Kong Investment holding (Acquired on 1.5.08) (G) Straits-KMP (HK) Ltd* (G) 51 51 Hong Kong Investment holding Ventek International Ltd* (G) 70 70 Hong Kong Investment holding

Keppel Land Limited 202 Report to Shareholders 2008 Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies Duit Investments Ltd* (G) 100 100 Hong Kong Investment holding Keppel Puravankara Development Pvt Ltd* (G) 51 51 India Property development PT Kepland Investama* (E) 100 100 Indonesia Property investment / development PT Kepindo Properti* (E) 100 100 Indonesia Property services PT Keppel Land* (A) 100 100 Indonesia Property services / development / investment PT Mitra Sindo Makmur* (E) 51 51 Indonesia Property development/ investment PT Mitra Sindo Sukses* (E) 51 51 Indonesia Property development/ investment PT Ria Bintan* (E) 46 46 Indonesia Golf course ownership and operation PT Sedona Hotels Indonesia* (A) 100 100 Indonesia Hotel and resort management PT Sentral Supel Perkasa* (A) 80 80 Indonesia Property investment / development PT Sentral Tunjungan Perkasa* (A) 80 80 Indonesia Property development PT Straits CM Village* (E) 39 39 Indonesia Hotel ownership and operations Alpha Investment Partners Japan Limited* (H) 100 100 Japan Real estate asset management Alpha Investment Partners Korea Private 100 100 Korea Real estate research Limited* (H) and consulting Keppel Investment (Mauritius) Pte Ltd* (A) 100 100 Mauritius Investment holding Rochor Investment Ltd* (G) 55 55 Mauritius Investment holding Straits Greenfield Ltd* (G) 100 100 Myanmar Hotel ownership and operations Wiseland Investment Myanmar Ltd* (G) 100 100 Myanmar Hotel ownership and operations Buena Homes, Inc* (B) 51 51 Philippines Investment holding Keppel Philippines Properties Inc. (B) Philippines Investment holding Ordinary Shares 51 51 Preference Shares 100 100 Keppel Al Numu Development Ltd* 51 - Saudi Arabia Property development (Incorporated on 26.2.08) (A) Cornerstone Realty Co Ltd* (A) 45 45 Thailand Property development Gold Star Property Co Ltd* (A) 45 45 Thailand Property development Keppel Thai Properties Public Co Limited (A) 45 45 Thailand Property development / investment Thai-Kami Co Ltd* (A) 45 45 Thailand Property development Top Property Co Ltd* (A) 66 66 Thailand Property development Utayan Thani Co Ltd* (A) 49 49 Thailand Investment holding Straits (USA) Inc (H) 100 100 United States Investment holding of America Estella Joint Venture Company Limited* (E) 55 55 Vietnam Property development International Centre* (E) 43 43 Vietnam Property investment Keppel Land Watco I Co Ltd* (F) 68 68 Vietnam Property investment / development

Significant Subsidiary and Associated Companies 203 Significant Subsidiary and Associated Companies

Country of Effective Incorporation/ Equity Interest Place of Principal 2008 2007 Business Activities % %

Subsidiary Companies Quang Ba Royal Park Joint Venture Company* (F) 59 59 Vietnam Property investment Riviera Cove Joint Venture Limited Liability Company* 60 - Vietnam Property development (Incorporated on 9.6.08) (A) Riviera Point Limited Liability Company* 75 - Vietnam Property investment (Incorporated on 15.2.08) Saigon Riviera JV Co Ltd* (A) 90 90 Vietnam Property development Saigon Sports City Limited* (A) 90 90 Vietnam Property development

Associated Companies Asia Real Estate Fund Management Limited* 50 50 Singapore Fund management BFC Development Pte Ltd* 33 33 Singapore Property development Bugis City Holdings Pte Ltd (Under liquidation) 42 42 Singapore Property investment Central Boulevard Development Pte Ltd* 33 33 Singapore Property development CityOne Township Development Pte Ltd* 50 50 Singapore Investment holding EM Services Pte Ltd (G) 25 25 Singapore Property management K-REIT Asia* 44 42 Singapore Real estate (42% up to 29.4.08) investment trust Keppel Bay Pte Ltd (C) 30 30 Singapore Property development Keppel Point Pte Ltd (C) 30 30 Singapore Property development / investment Kingsdale Development Pte Ltd* 50 50 Singapore Investment holding Parksville Development Pte Ltd* 50 50 Singapore Property investment Raffles Quay Asset Management Pte Ltd* 33 33 Singapore Property management SAFE Enterprises Pte Ltd (D) 25 25 Singapore Investment holding Yihe Holding Pte Ltd * 50 45 Singapore Investment holding Cityone Development (Wuxi) Co Ltd* (A) 50 50 China Property development Asia No. 1 Property Fund Ltd (See Note 6)* (E) 10 10 Guernsey Property investment Keppel Magus Development Pvt Ltd* (G) 38 38 India Property development PT Pantai Indah Tateli* (A) 50 50 Indonesia Property development PT Pulomas Gemala Misori* (G) 25 25 Indonesia Property development PT Purimas Straits Resorts* (G) 25 25 Indonesia Development of holiday resort PT Purosani Sri Persada* (F) 20 20 Indonesia Property investment Jernih Rezeki Sdn Bhd* (A) 49 49 Malaysia Property development Renown Property Holdings (M) Sdn Bhd (A) 40 40 Malaysia Property investment Tropical Garden NV* (G) 25 25 Netherlands Investment holding Antilles SM Keppel Land, Inc* (B) 20 20 Philippines Property development Dong Nai Waterfront LLC* 50 - Vietnam Property development (Incorporated on 22.4.08) (A)

Keppel Land Limited 204 Report to Shareholders 2008 Notes: 1. The holding in the equity shown for each subsidiary and associated company is the proportion attributable to Keppel Land Limited. Changes in interest, if any, and subsidiary and associated companies acquired or disposed of during the year are as indicated in brackets against the companies concerned. Subsidiary companies (including their subsidiary and associated companies) and associated companies directly owned by Keppel Land Limited are included in the above list.

2. Associated companies are those in which the Group has a long-term substantial equity interest and in whose commercial and financial policy decisions the Group actively participates.

3. Companies indicated with an asterisk (*) are indirectly held by Keppel Land Limited.

4. All the active companies operate in their respective countries of incorporation, unless otherwise specified.

5. All the companies are audited by Ernst & Young LLP, Singapore except for the following: (A) Audited by member firms of Ernst & Young Global in the respective countries

(B) Audited by Sycip Gorres Velayo & Co, Philippines, an associated firm of Ernst & Young

(D) Audited by KPMG LLP, Singapore

(E) Audited by an overseas practice of Deloitte & Touche LLP

(F) Audited by an overseas practice of KPMG LLP

(G) Audited by other firms of auditors

(H) Not required to be audited by law in the country of incorporation

6. Asia No. 1 Property Fund Ltd is equity accounted for in the consolidated financial statements notwithstanding that the Group holds less than 20% of the voting power in this company on the ground that the Group exercises significant influence by virtue of its right to appoint two directors to its board.

7. In accordance with Rule 716 of The Singapore Exchange Securities Trading Limited, the Audit Committee and Board of Directors of the Company confirm that they are satisfied that the appointment of different auditors for certain of its subsidiary and associated companies will not compromise the standard and effectiveness of the audit of the Group.

Significant Subsidiary and Associated Companies 205 Corporate Information

Board of Directors Remuneration Committee Registered Office

Lim Chee Onn Tan Yam Pin 230 Victoria Street #15-05 Chairman Chairman Bugis Junction Towers Singapore 188024 Kevin Wong Kingcheung Lim Ho Kee Telephone: 63388111 Group Chief Executive Officer Facsimile: 63377168 Tsui Kai Chong Website: http://www.keppelland.com.sg Khor Poh Hwa

Lim Ho Kee

Tsui Kai Chong Board Risk Committee Independent Auditors Lee Ai Ming

Tan Yam Pin Heng Chiang Meng Ernst & Young LLP Niam Chiang Meng Chairman Public Accountants and Certified Public Accountants Heng Chiang Meng Khor Poh Hwa Singapore Audit Partner : Kevin Kwok Lim Ho Kee Edward Lee Kwong Foo (With effect from year ended 31 December 2007) Choo Chiau Beng Tsui Kai Chong

Teo Soon Hoe Niam Chiang Meng

Registrar

Audit Committee Board Safety Committee KCK CorpServe Pte Ltd 333 North Bridge Road #08-00 KH KEA Building Tsui Kai Chong Tan Yam Pin Chairman Singapore 188721 Chairman Telephone: 68372133 Lee Ai Ming Khor Poh Hwa Facsimile: 63383493

Heng Chiang Meng Lee Ai Ming Edward Lee Kwong Foo Share Listing

Nominating Committee Joint Company Secretaries The Company’s shares are listed on the Singapore Exchange Securities Trading Lim Ho Kee Limited. Chairman Choo Chin Teck

Khor Poh Hwa Yeo Kah Tiang Niam Chiang Meng

Keppel Land Limited 206 Report to Shareholders 2008 Calendar of Financial Events

FY 2008

Announcement of Results: First Quarter 23 April 2008 Interim 30 July 2008 Third Quarter 22 October 2008 Total Year 21 January 2009

End of Financial Year 31 December 2008

Despatch of Summary Financial Report 26 March 2009

Despatch of Annual Report 9 April 2009

Annual General Meeting 24 April 2009

Extraordinary General Meeting (“EGM”) (To approve addition to the Company’s Articles 24 April 2009 for the implementation of the Dividend Reinvestment Scheme)

Dividend Payment Date To be announced following EGM

FY 2009

Announcement of Results: First Quarter April 2009 Interim July 2009 Third Quarter October 2009 Total Year January 2010

End of Financial Year 31 December 2009

Despatch of Summary Financial Report March 2010

Despatch of Annual Report April 2010

Annual General Meeting April 2010

Dividend Payment Date May 2010

Calendar of Financial Events 207 Corporate Structure

Singapore Projects

100% 50% Keppel Land International Limited Asia Real Estate Fund Management Limited 100% Alpha Investment Partners Limited

100% Straits Properties Limited

100% Keppel Land Financial Services Pte Ltd

100% 76% Straits Property Investments Pte Ltd Ocean Properties Pte Ltd

100% Keppel Land Realty Pte Ltd

100% Glenville Estate Investment Pte Ltd

100% Harvestland Development Pte Ltd

100% Acresvale Investment Pte Ltd

100% Tat Chuan Development (Pte) Ltd

Keppel 100% KeppelLand Land K-REIT Asia Property Management 33% Raffles Quay Asset Management LimitedLimited Pte Ltd Pte Ltd 100% K-REIT Asia Management Limited

100% 10% Aintree Assets Ltd Asia No 1 Property Fund Ltd 50% 31% 50% 19.5% Rochor Investment Ltd Bugis City Holdings Pte Ltd

100% 43% 1% K-REIT Asia Investment Pte Ltd K-REIT Asia

100% Boulevard Development Pte Ltd 33% BFC Development Pte Ltd 100% 100% Keppel Land Properties Pte Ltd Bayfront Development Pte Ltd 33% Central Boulevard Development Pte Ltd 100% 100% BCH Office Investment Pte Ltd Ocean & Capital Properties Pte Ltd 52% Avenue Park Development Pte Ltd 60% Devonshire Development Pte Ltd

100% Denton Investment Pte Ltd 50% Parksville Development Pte Ltd

100% 100% KeplandeHub Limited 100% Keppel Digihub Holdings Ltd Keppel Digihub Ltd

65% D.L. Properties Ltd

30% Keppel Bay Pte Ltd

30% Keppel Point Pte Ltd

Keppel Land Limited 208 Report to Shareholders 2008 Overseas Projects

100% 20% Silkland Investment Pte Ltd P.T. Purosani Sri Persada 100% 25% Flannigan Investment Pte Ltd P.T. Pulomas Gemala Misori 100% 50% Montfort Development Pte Ltd P.T.Pantai Indah Tateli 100% 80% Meadowsville Investment Pte Ltd P.T. Sentral Tunjungan Perkasa 100% 100% 80% Keppel Land International Limited P.T. Keppel Land P.T. Sentral Supel Perkasa 100% Daysville P.T. Kepland Investama 90% Development 100% 51% Pte Ltd Le-Vision Pte Ltd P.T. Mitra Sindo Sukses Bintan Bay Resort Pte Ltd 51% 100% 51% 5% Castlehigh Pte Ltd P.T. Mitra Sindo Makmur Straits-KMP Resort Development Pte Ltd 25% Tropical Garden NV 30% 85% 95% 5% 51% Prestige Landmark Pte Ltd 35% P.T. Purimas Straits Resorts Straits-CM Village Hotel Pte Ltd P.T. Ria Bintan 100% 100% 100% Oil (Asia) Pte Ltd Pembury Properties Ltd PT Straits-CM Village 70% 10% Erskine Holdings Ltd Avondale Properties Ltd 90% 100% Jencity Ltd Union Charm Development Ltd 100% Saigon Centre Investment Ltd 100% 50% Saigon Sports City Limited 100% 50% 68% Saigon Centre Holdings Pte Ltd Keppel Land (Saigon Centre) Ltd Keppel Land Watco I Co. Ltd 55% 79% Fernland Investment Pte Ltd International Centre 84% 70% Palmsville Investment Pte Ltd Quang Ba Royal Park Joint Venture Company 100% Keppel Land Vietnam Properties 100% 60% Pte Ltd Willowville Pte Ltd Keppel Land Agtex Ltd 100% 90% Red Vibrant Investments Ltd Saigon Riviera JV Co Ltd 100% 55% Keppel Land Estate Pte Ltd Estella Joint Venture Company Limited 100% 75% Elaenia Pte Ltd Riviera Point Limited Liability Company 100% 60% VN Investment Pte Ltd Riviera Cove Joint Venture Limited Liability Company

100% 50% Keppel Portsville Pte Ltd Dong Nai Waterfront LLC Land 100% 100% Limited Greenfield Development Pte Ltd Straits Greenfield Ltd 100% 100% Wiseland Investment Pte Ltd Wiseland Investment Myanmar Ltd 100% 30% Straits (USA) Inc Keppel Houston Group 40% Renown Property Holdings (M) Sdn 45% Bhd Tanah Sutera Development Sdn Bhd 51% 100% 40% Keppel Philippines Properties Inc Buena Homes Inc Buena Homes (Sandoval) Inc 40% Sm-Keppel Land Inc 100% 39% Hampshire Pte Ltd 61% Top Property Co Ltd 45% 100% Keppel Thai Properties Public Co Cornerstone Realty Co Ltd Limited 100% Gold Star Property Co Ltd 100% 51% Keppel Puravankara Development Thai-Kami Co Ltd Pvt Ltd 100% 51% Keppel Land (Arabia) Pte Ltd Keppel Al Numu Development Ltd 100% 100% 19% Wisley Pte Ltd Keppel Investment (Mauritius) Pte Ltd Tianjin Merryfield Property Development Co Ltd 81% 38% Keppel Magus Development Pvt Ltd 99% Shanghai Merryfield Land Co Ltd 100% 100% 30% Kingsley Investment Pte Ltd Beijing Kingsley Property Development 40% Co Ltd CityOne Development (Wuxi) Co Ltd 51% 100% 100% Quivivet Pte Ltd Keppel Land China Holdings Pte Ltd Merryfield Investment Pte Ltd 10% 50% 83% CityOne Township Development Pte Ltd Chengdu Century Development Co Ltd 100% 99% 1% 99% Pasir Panjang Realty Pte Ltd Shanghai Pasir Panjang Land Co Ltd Shanghai Minghong Property Co Ltd 85% 100% 99% Shanghai Hongda Property Development Co Ltd 1% Evergro Properties Limited Third Dragon Holdings Pte Ltd Third Dragon Development Pte Ltd 100% 99% 100% Floraville Estate Pte Ltd Shanghai Floraville Land Co Ltd 44% 100% 100% 39% Hillwest Pte Ltd Chengdu Hillwest Development Co Ltd Jiangyin Evergro Properties Co Ltd 100% 100% 100% Keppel Township Development Changzhou Fushi Housing Development Pte Ltd Keppel China Township 95% Development Pte Ltd (Shenyang) Co Ltd Jiangyin Yangtze International Country Club Co Ltd 100% 100% Spring City Resort Pte Ltd 50% Kingsdale Development Pte Ltd Tianjin Pearl Beach International Country Club Co Ltd 5% 100% 80% Keppel Marina China Holdings Sunseacan Investment (HK) Company Tianjin Fushi Property Development Co Ltd 95% Pte Ltd Limited 100% Sunsea Yacht Club (Zhongshan) Co Ltd

Corporate Structure 209 Property Portfolio

Group Properties (Singapore)

Description Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm)

Completed Properties

Ocean Towers a 27-storey office tower Ocean 75.7% 3,552 32,332 21,129 1992 999-year located in Raffles Place Properties leasehold

Equity Plaza a 28-storey office building DL 64.6% 2,345 31,538 23,161 1992 99-year located in Raffles Place Properties leasehold

Keppel Bay Tower an 18-storey office building HarbourFront 11.7% 17,267 41,823 36,035 2002 99-year at HarbourFront Avenue One leasehold

HarbourFront Tower One an 18-storey office building HarbourFront 11.7% 15,072(a) 40,278 34,433 2002 99-year at HarbourFront Place Two leasehold

HarbourFront Tower Two a 13-storey office building HarbourFront 11.7% 15,072(a) 19,227 14,238 2003 99-year at HarbourFront Place Two leasehold

Prudential Tower(b) a 30-storey office building K-REIT 44.1% 1,998 10,250 10,074 1998 99-year at Cecil Street Asia (retained (retained leasehold interest) interest)

Keppel Towers and GE Tower(b) two office towers K-REIT 44.1% 9,127 52,946 40,002 1991/ Freehold at Hoe Chiang Road Asia 1993

Bugis Junction Towers(b) a 15-storey office tower K-REIT 44.1% - 27,724 22,991 1995 99-year at Bugis Junction Asia leasehold

One Raffles Quay(b) two office towers located at the K-REIT 44.1% 11,367 49,489 41,359 2006 99-year New Downtown at Marina Bay Asia (1/3 (1/3 leasehold interest) interest)

Caribbean at Keppel Bay a 969-unit luxurious waterfront Keppel Bay 30% 97,494 132,780 19,561 2004 99-year condominium development at (retained leasehold Keppel Bay. Some 168 units interest) have been kept as corporate residences

The Tresor a 62-unit condominium Keppel Land 100% 7,479 10,469 3,892 2007 999-year development at Realty (retained leasehold Duchess Road interest)

Keppel Land Limited 210 Report to Shareholders 2008 Group Properties (Singapore) (continued)

Description Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm)

Completed Properties (continued)

Park Infinia at Wee Nam a 486-unit condominium Keppel Land 100% 21,733 61,616 3,015 2008 Freehold development at Realty (retained Wee Nam / Keng Lee Road interest)

Nassim Woods a 35-unit luxurious Parksville 50% 5,785 9,256 8,468 1998 99-year condominium development Development leasehold at Nassim Road

Vision Crest a commercial / residential Dovesdale 10% 11,560 21,415 140 2007 Freehold mixed development at Development (residential) (retained (residential) Penang Road 16,277 interest 2008 (commercial) for residential) (commercial)

Heritage Court conservation shophouses Glensville 100% 1,150 - 534 1996 99-year at Peck Seah Street Estate (retained leasehold Investment interest)

Joo Chiat Shophouses conservation shophouses Keppel Land 100% 784 - 1,139 1996 Freehold located in the Joo Chiat area Realty (retained interest) Quartz Industrial Building a modern 8-storey Harvestland 100% 5,657 - 3,569 1997 Freehold industrial building Development (retained at Upper Aljunied Link interest)

Orion Industrial Building a modern 8-storey Acresvale 100% 5,790 - 4,723 1997 Freehold industrial building Investment (retained at Paya Lebar interest)

Keppel Digihub a modern 6-storey Keppel Digihub 100% 7,333 18,345 12,119 1997 30-year industrial building at leasehold Serangoon North Ave 5 with option for another 30 years

Marina at Keppel Bay a marina development at Keppel Bay 30% 27,081 3,000 1,590 2007 99-year Keppel Bay (includes leasehold foreshore (Foreshore area) area - 30-year leasehold)

Property Portfolio 211 Property Portfolio

Group Properties (Singapore) (continued)

Description Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion

Properties under Development

Ocean Financial Centre a 43-storey office building Ocean 75.7% 2,557 95,992 78,587 2011 999-year located at Collyer Quay Properties leasehold corner of Raffles Place

Marina Bay Financial Centre (Phase 1) BFC 33.3% 20,505(c) 189,000 151,200 2010 99-year two office towers of Development leasehold 33 storeys and 50 storeys with ancillary retail space at the New Downtown

Marina Bay Financial Centre (Phase 2) Central 33.3% 15,010(d) 150,393 120,314 2012 99-year a 46-storey office tower Boulevard leasehold with retail podium Development at the New Downtown

Marina Bay Residences(e) a 428-unit condominium BFC 33.3% 20,505(c) 55,000 - 2010 99-year development at the Development leasehold New Downtown

The Sixth Avenue Residences(e) a 175-unit condominium Ocean & 52% 16,056 22,477 - 2009 Freehold development at Sixth Avenue Capital Properties

The Suites at Central(e) a 157-unit luxurious Devonshire 60% 7,400 20,720 - 2009 Freehold condominium development Development at Devonshire Road

Reflections at Keppel Bay a 1,129-unit waterfront Keppel Bay 30% 83,591 193,400 - 2013 99-year condominium development leasehold at Keppel Bay

Keppel Land Limited 212 Report to Shareholders 2008 Group Properties (Singapore) (continued)

Description Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion

Landbank

Marina Bay Suites a 221-unit luxury Central 33.3% 5,300 43,607 - - 99-year condominium development Boulevard leasehold at the New Downtown Development

Madison Residences a 56-unit condominium Keppel Land 100% 4,568 10,294 - - Freehold development at Realty Bukit Timah Road

The Promont a 15-unit apartment Tat Chuan 100% 1,039 2,909 - - Freehold development at Cairnhill Circle Development

Keppel Bay Plot 3 a 307-unit waterfront Keppel Bay 30% 38,822 47,380 - - 99-year condominium development leasehold at Keppel Bay

Keppel Bay Plot 6 a 94-unit waterfront Keppel Bay 30% 43,797 21,000 - - 99-year condominium development leasehold at Keppel Bay

HarbourFront Avenue (Plot 4) a 234-unit waterfront HarbourFront 11.7% 28,676 32,000 - - 99-year condominium development Three leasehold at HarbourFront Avenue

Property Portfolio 213 Property Portfolio

Group Properties (Overseas)

Description Location Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm) (Commercial)/ No. of Units (Residential)

Completed Properties

China Office Development(g) office units in Shanghai, Evergro 85.4% - 635 635 2004 50 years Chang Ning District China Properties lease

Spring City Golf & Lake Resort an integrated resort Kunming, Spring 40% 2,884,749 2,649,802 Two 18-hole 1998 50 years comprising China City Golf golf courses, lease golf courses, and 14,205 a 1998 50 years resort homes Lake Resort clubhouse, lease and resort facilities Co 5,552 Primrose - 50 1999 70 years resort homes lease 14,681 Magnolia - 83 2001 70 years resort homes lease 18,568 Azalea I - 71 2004 70 years resort homes lease 10,798 Azalea II - 45 2008 70 years resort homes lease

Jiangyin Yangtze International Country Club(g) a golf course Jiangyin, Jiangyin 81.1% 957,281 - - 2006 40 years/ development China Yangtze 50 years International lease Country Club Co

Tianjin Pearl Beach International Country Club(g) a golf course Tianjin, Tianjin 85.4% 787,405 - - 2006 40 years development China Pearl Beach lease in South Island International Country Club Co

Keppel Land Limited 214 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm) (Commercial)/ No. of Units (Residential)

Completed Properties (continued)

Summerville(g) a 566-unit residential Changzhou, Changzhou 85.4% 46,108 86,600 566 2008 70 years development China Fushi residential units, lease with retail shops Housing 10,000 sm Development (retail)

Serenity Cove (Phase 1)(g) an 83-unit villa Tianjin, Tianjin 85.4% 114,172 28,000 83 villas 2008 70 years development China Fushi lease Property Development Co

Indonesia Club Med Ria Bintan a beachfront hotel at Bintan, PT Straits 39% 200,000 - 302-room 1997 30 years Ria Bintan Resort Indonesia - CM Village hotel lease with option for another 50 years

Ria Bintan (Phase 1) a 36-hole golf course Bintan, PT 45.9% 1,467,000 - 36-hole 1998 30 years Indonesia Ria Bintan golf course lease with with option for clubhouse another 50 years

Melia Purosani Hotel a 5-star hotel Yogyakarta, PT 20% 18,189 26,398 296-room 1994 20 years with retail outlets Indonesia Purosani hotel lease with Sri Persada option for another 20 years

Nongsa Point Marina and Resort a waterfront resort with Batam, PT 17% 100,000 - 192 rooms/ 1995 30 years a marina and Indonesia Nongsa chalets and lease with hotel-style chalets Point Marina 158 berths option for another 50 years

Property Portfolio 215 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm) (Commercial)/ No. of Units (Residential)

Completed Properties (continued)

Pasadenia Garden (Phase 1) a residential Jakarta, PT 25% 32,586 32,490 147 units of 1996 30 years development Indonesia Pulomas strata-titled lease with within Pulomas Gemala condominium, option for residential district Misori 50 units of another rental apartments 20 years and a 2-storey clubhouse

Wisma BCA a prime office Jakarta, PT 100% 10,444 48,267 38,093 1985 20 years development Indonesia Kepland lease with located in Investama option for Jakarta CBD another 20 years

Hotel Sedona Manado a 5-star Manado, PT Pantai 50% 243,083 - 247-room 2006 30 years international Indonesia Indah Tateli hotel (Phase 1) lease with class hotel (Phase 1 - option for 143 rooms) another 20 years

BG Junction a retail/commercial Surabaya, PT Sentral 80% 25,840 154,734 41,245 2006 30 years development Indonesia Supel lease with in Surabaya Perkasa option for another 20 years

Malaysia Taman Sutera, Skudai a township comprising Johor, Tanah 18% 969,047 - 2,007 2003/ Freehold residential units, Malaysia Sutera residential units, 2005/ commercial space and Development 191 2007/ recreational facilities shop offices, 2008 and 4 commercial units

Keppel Land Limited 216 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm) (Commercial)/ No. of Units (Residential)

Completed Properties (continued)

Myanmar Sedona Hotel Yangon a 5-star hotel Yangon, Straits 100% 31,889 53,489 334 rooms, 1997 30 years fronting Yangon’s Myanmar Greenfield 32 serviced BOT with famous Inya Lake apartments option for and another 30 office suites three 5-year extensions

Sedona Hotel Mandalay an international Mandalay, Wiseland 100% 16,467 19,835 220 rooms 1998 30 years class hotel opposite Myanmar Investment and BOT the famous ancient (Myanmar) 27 serviced Mandalay Palace apartments

Philippines(i) Palmdale Heights a 29-block residential Pasig City, Buena 30.9% 22,978 47,063 828 residential 2004 Freehold development with Philippines Homes (Phases 1 (Phases 1 apartments 4,000 apartment units, (Sandoval) & 2) & 2) with clubhouse 3 parking buildings and Inc. (Phases 1 & 2) 2 commercial buildings. To be developed in phases

SM-KL Towers (Phase 1) a 5-storey retail mall Ortigas SM 24.2% 7,068 13,663 10,238 1985 Freehold called The Podium CBD, Keppel (Benguet (Benguet (Benguet with an existing Mandaluyang Land Centre) Centre) Centre) office building City, Inc. 26,767 18,518 2001 Philippines (The Podium) (The Podium) (The Podium)

Sampaguita Ville 12 units of Cebu, Opon 20.2% 5,498 960 - 1996 Freehold linked houses Philippines Realty and Devt Corp

Property Portfolio 217 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated year of Tenure (sm) Gross Floor Net Lettable Completion Area (sm) Area (sm) (Commercial)/ No. of Units (Residential)

Completed Properties (continued)

Thailand(j) Jewellery Centre a 34-storey strata- Bangkok, Keppel 45.5% 5,866 42,834 12,146 1993 Freehold titled commercial Thailand Thai (retained building at Nares Road Properties interest)

Sukhaphiban 3 Mansion a 19-storey strata-titled Bangkok, Gold Star 45.5% 4,440 70,000 119 1994 Freehold residential apartment Thailand Property (retained at Sukhaphiban 3 Road interest)

Vietnam International Centre an 8-storey office Hanoi, International 43% 1,450 9,064 7,009 1995 45 years development at Vietnam Centre lease 17 Ngo Quyen Street

Royal Park a serviced apartment Hanoi, Quang Ba 59% 28,400 23,130 155 units of 1998 50 years development at Vietnam Royal Park serviced lease Quang Ba, West Lake JV Co apartments and 20 villas

Saigon Centre (Phase 1) a 25-storey office, Ho Chi Keppel 68% 2,730 32,499 10,443 sm 1996 50 years retail cum serviced Minh City, Land (office), lease apartment development Vietnam Watco Co 3,663 sm at Le Loi Boulevard in (retail), prime District 1 305 sm (post office), and 89 serviced apartments

Petro Vietnam Towers a 10-storey Vung Tau, Petro Tower 12.9% 6,191 17,026 12,465 1997 40 years office development Vietnam lease

USA TCB Building a 12-storey Houston, Keppel 30% 13,015 27,323 26,858 1982 Freehold office building located Texas, Houston in the prestigious USA Group Galleria area of Houston Partnership

Keppel Land Limited 218 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development

China 8 Park Avenue a 946-unit Shanghai, Shanghai 99% 33,432 135,503 946 2012/ 70 years residential development China Pasir Panjang residential 2013 lease complete with Land Co apartments recreational facilities (Plot B)

Park Avenue Central third and final Shanghai, Shanghai 99% 28,488 ** ** ** 70 years phase of China Floraville lease Park Avenue Land Co precinct (Plot C)

Villa Riviera a 168-unit Shanghai, Shanghai 99% 153,726 53,796 168 units 2009/ 70 years landed development China Minghong of villas and 2010 lease in Xujing Town, Property landed homes Qingpu District Co

Residential Development a 2,753-unit Shanghai, Shanghai 99% 264,090 332,906 2,753 2015 70 years residential development China Hongda residential lease with integrated facilities Property apartments (residential) in Nanhui District Development 40 years Co lease (commercial)

The Botanica (Phase 3) an 9,400-unit residential Chengdu, Chengdu 44.1% 417,139(f) 1,042,846(f) 1,048 2009 70 years township development China Century residential (Phase 3) lease with integrated facilities, Development units (residential) to be developed Co (Phase 3) 40 years in phases 1,028 2011 lease residential (Phase 4) (commercial) units (Phase 4)

Spring City Golf & Lake Resort an integrated resort Kunming, Spring 40% 2,157,361 3,229 Azalea III 2009 70 years comprising China City Golf - 12 resort lease golf courses, and homes resort homes and Lake Resort 14,079 La Quinta Ph 1 2009/ 70 years resort facilities Co - 43 resort 2010 lease homes 421,225 Resort homes 2017 70 years lease

Property Portfolio 219 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Central Park City a 5,000-unit residential Wuxi, CityOne 49.7% 352,534 670,460 1,448 2009 70 years township development China Development residential (Phase 1) lease with integrated facilities, (Wuxi) Co units (residential) to be developed (Phase 1) 40 years in phases lease (commercial)

Township Development a 6,200-unit residential Shenyang, Keppel 100% 338,287 743,847 1,722 2012 50 years township with China Township residential (Phase 1) lease integrated facilities, Development units (residential) to be developed over (Shenyang) (Phase 1) 40 years three phases Co lease (commercial)

Zhongshan Marina an integrated marina Zhongshan, Sunsea 80% 871,700 408,000 300 villas 2010/ 70 years lifestyle development China Yacht Club with private 2013 lease (Zhongshan) berths; (residential) Co 2,500 40 years residential lease apartments (commercial)

The Arcadia a 168-unit villa Tianjin, Tianjin 100% 127,970 62,698 168 villas 2009 70 years development China Merryfield lease complete with private Land clubhouse facilities Co

Serenity Cove(g) a development Tianjin, Tianjin 85.4% 80,998 38,000 150 landed 2010 70 years in South Island China Fushi (Phase 2) (Phase 2) residential (Phase 2) lease Property 350,758 units Development (remaining (Phase 2) Co phases)

Mixed Development(g) a mixed development Tianjin, Tianjin 85.4% 666,665 *** *** *** 40 years/ in North Island China Fushi 70 years Property lease Development Co

Keppel Land Limited 220 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Mixed Development(g) a mixed development Tianjin, Tianjin 85.4% 1,000,000 *** *** *** 70 years in North Island China Fulong lease Property (residential) Development 40 years Co lease (commercial)

Stamford City(h) a mixed development Jiangyin, Jiangyin 76.4% 82,987 305,000 150 2010 70 years with residential, office China Evergro residential (Phase 1) lease and retail space Properties units (residential) to be developed Co (Phase 1) 50 years over three phases lease (office) 40 years lease (commercial)

India Elita Promenade a 1,573-unit high-rise Bangalore, Keppel 51% 96,618 193,236 1,573 2010 Freehold condominium India Puravankara residential development in Development apartments JP Nagar

Elita Horizon a 1,138-unit high-rise Bangalore, Keppel 51% 79,927 170,844 1,138 2014 Freehold condominium India Puravankara residential development off Development apartments Kanakapura Road

Elita Garden Vista a 1,278-unit high-rise Greater Keppel 37.7% 99,966 195,371 1,278 2011 Freehold condominium Kolkata, Magus residential development within India Development apartments Rajarhat Township

Indonesia Ria Bintan (Phase 2 onwards) an integrated resort Bintan, PT 45.9% 2,803,000 *** Resort homes *** 30 years with golf courses, Indonesia Ria Bintan lease with a Club Med Village option for and resort homes another 50 years

Property Portfolio 221 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Pasadenia Garden (Phase 2) a residential Jakarta, PT 25% 47,454 *** Residential *** 30 years development within Indonesia Pulomas units lease with the Pulomas district Gemala option for Misori another 20 years Jakarta Garden City a 7,000-unit Jakarta, PT Mitra 51% 2,700,000 - 7,000 2011 30 years residential township Indonesia Sindo residential (Phase 1) lease with in Cakung, Sukses units 2013 option for East Jakarta (Site A - (Phase 1 - (Phase 2) another Southern) 989 units) 20 years PT Mitra (Phase 2 - Sindo Makmur 426 units) (Site B - Northern) Galleria Tunjungan a retail/commercial Surabaya, PT Sentral 80% 23,768 *** *** *** 30 years complex in Surabaya Indonesia Tunjungan lease with Perkasa option for another 20 years Tanah Lot Resort an integrated resort Bali, PT 25.5% 858,110 *** Resort *** 30 years incorporating Indonesia Purimas bungalows lease with resort bungalows, Straits (Phase 1) option for spa village and Resort another recreational facilities 20 years

Malaysia Taman Sutera, Skudai a township comprising Johor, Tanah 18% 3,898,540(f) - 101 2009/ Freehold residential units, Malaysia Sutera (95,762 residential 2010 commercial space Development currently units and and recreational facilities under 104 shop office development) units currently under development

Keppel Land Limited 222 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Philippines(i) Palmdale Heights a 29-block residential Pasig City, Buena 30.9% 15,976 62,751 1,264 ** Freehold development with Philippines Homes (Phases 3 (Phases 3 residential 4,000 apartment units, (Sandoval) & 4) & 4) apartments and 3 parking buildings and Inc. 37,202 303 parking lots 2 commercial buildings. (Phases (Phases 3 & 4); To be developed in phases 5-8) 2,070 residential apartments, 3,031 sm (commercial) and 517 parking lots (Phases 5-8)

SM-KL Towers two 55-storey office Ortigas SM 24.2% 12,932 ** ** ** Freehold towers and a 70-storey CBD, Keppel Land residential tower, Mandaluyong Inc. interlinked by a City, 5-storey retail podium Philippines called The Podium. To be developed in phases

Vacant Land at Carajay Road Cebu, Opon 20.2% 7,838 - - - Freehold Philippines Realty and Development Corp

Metro North Township an option with San Jose Swansville 46.1% 6,000,000 *** *** *** Freehold Araneta Properties del Monte, Investment to jointly develop a Bulacan (Philippines) residential township (north of on a 600-ha site. Quezon City), To be developed Philippines in phases

Property Portfolio 223 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Saudi Arabla Waterfront Residential Development a 993-unit high-rise Jeddah, Keppel 51% 36,236 253,652 993 2013 Freehold luxury residential Saudi Al Numu development Arabia Development located along the prime Corniche waterfront

Thailand(j) Villa Arcadia at Srinakarin a 367-unit detached Bangkok, Thai-Kami 45.5% 159,706 - 367 2012 Freehold housing development Thailand detached off Srinakarin Road houses

Villa Arcadia at Watcharapol a 270-unit detached Bangkok, TOP 66.7% 124,912 - 270 2012 Freehold housing development Thailand Property(k) detached at Watcharapol Road houses

Vietnam Saigon Centre (Phase 2) prime office space / Ho Chi Keppel 68% 17,156 ** ** 2013 50 years hotel / Minh City, Land lease serviced apartments / Vietnam Watco Co lifestyle retail at Le Loi Boulevard in prime District 1

Tamarind Park a 20-storey Ho Chi Keppel 60% 2,808 26,181 173 2013 45 years apartment tower Minh City, Land residential lease with recreational Vietnam Agtex apartments facilities in prime District 1

Keppel Land Limited 224 Report to Shareholders 2008 Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Saigon Sports City township with Ho Chi Saigon 90% 640,477 827,000 3,000 2013 50 years 3,000 apartments, Minh City, Sports residential (Phase 1) lease supporting Vietnam City apartments commercial complexes and public sports facilities in prime District 2

The Estella a 1,393-unit Ho Chi Estella 55% 47,906 279,851 1,393 2012 50 years high-rise residential Minh City, JV Co residential (Phase 1) lease development with Vietnam apartments supporting commercial (Phase 1 - 719 space in An Phu Ward residential units; in prime District 2 Phase 2 - 674 residential units; Phase 3 - 37,005 sm commercial)

Riviera Point a 2,400-unit Ho Chi Riviera 75% 85,118 447,000 2,400 2012 50 years high-rise residential Minh City, Point residential (Phase 1) lease development with Vietnam LLC apartments, supporting commercial 103,000 sm space in District 7 (commercial)

Waterfront Condominium Development a 550-unit Ho Chi The 60% 17,428 87,140 550 2013 50 years high-rise residential Minh City, Waterfront apartment lease development Vietnam JV Co units in Binh Thanh District

Riviera Cove a 96-unit gated Ho Chi Riviera 60% 97,000 39,479 96 villas 2011 50 years villa development Minh City, Cove lease in District 9 Vietnam LLC

Condominium Development a 1,500-unit Ho Chi Parc 60% 51,043 244,800 1,500 2014 50 years high-rise residential Minh City, Riviera residential lease development with Vietnam JV Co. apartments, supporting commercial 39,168 sm space in District 2 (commercial)

Property Portfolio 225 Property Portfolio

Group Properties (Overseas) (continued)

Description Location Held by % Owned Site Area Estimated Estimated Expected Tenure (sm) Gross Floor Net Lettable year of Area (sm) Area (sm) Completion (Commercial)/ No. of Units (Residential)

Properties Under Development (continued)

Villa Development a 204-unit gated Ho Chi Parc Villas 55% 129,739 53,510 204 villas 2012 50 years villa development Minh City, JV Co. lease in District 9 Vietnam

Condominium Development a 1,939-unit high-rise Ho Chi Parc View 55% 68,442 273,760 1,939 2015 50 years residential development Minh City, JV Co. residential (Phase 1) lease in District 9 Vietnam apartments

Dong Nai Waterfront City a 10,434-unit residential Dong Nai Dong Nai 50% 3,667,127 2,743,000 10,434 2013 50 years township with quality Province, Waterfront residential (Phase 1) lease housing and supporting Vietnam City LLC units commercial space in Long Hung, Long Thanh District

(a) Comprises both HarbourFront Tower One and Two (b) Assets owned by K-REIT Asia in which the Group has a 44.1% stake (c) Comprises MBFC Phase 1 and Marina Bay Residences (d) Comprises MBFC Phase 2 and Marina Bay Suites (e) Units have been fully sold (f) For entire site; including land to be developed in later stages (g) Assets owned by Evergro Properties Ltd in which the Group has a 85.4% stake (h) Keppel Land owns a 38.6% direct stake in Jiangyin Evergro Properties Co Ltd (JEP) as well as a 85.4% stake in Evergro Properties Ltd which also has a 44.3% stake in JEP (i) Assets owned by Keppel Philippines Properties Inc. in which the Group has a 51% stake (j) Assets owned by Keppel Thai Properties Co Ltd (KTP) in which the Group has a 45.5% stake (k) Keppel Land owns a 39% direct stake in Top Property Co Ltd as well as a 45.5% stake in KTP which also has a 61% stake in Top Property Co Ltd ** Under planning stage *** Plans are under review in accordance to market conditions

Keppel Land Limited 226 Report to Shareholders 2008 Statistics of Shareholdings As at 2 March 2009

Number of issued shares : 721,317,081 Class of shares : Ordinary shares with equal voting rights

Number of Number of Size of Shareholdings Shareholders % Shares %

1 - 999 794 5.01 241,215 0.03 1,000 - 10,000 13,017 82.10 47,132,843 6.54 10,001 - 1,000,000 2,025 12.77 77,613,299 10.76 1,000,001 and above 19 0.12 596,329,724 82.67 Total 15,855 100.00 721,317,081 100.00

Number of Number of Location of Shareholdings Shareholders % Shares %

Singapore 14,944 94.25 713,461,700 98.91 Malaysia 623 3.93 5,150,335 0.71 Others 288 1.82 2,705,046 0.38 Total 15,855 100.00 721,317,081 100.00

Statistics of Shareholdings 227 Statistics of Shareholdings

Twenty Largest Shareholders Number of Shares %

1 Keppel Corporation Limited 379,697,733 52.64 2 Citibank Nominees Singapore Pte Ltd 48,428,356 6.71 3 DBS Nominees Pte Ltd 46,119,462 6.39 4 HSBC (Singapore) Nominees Pte Ltd 32,878,843 4.56 5 DBSN Services Pte Ltd 28,744,652 3.99 6 Raffles Nominees Pte Ltd 10,808,072 1.50 7 United Overseas Bank Nominees Pte Ltd 10,279,001 1.43 8 DB Nominees (S) Pte Ltd 8,532,462 1.18 9 UOB Kay Hian Pte Ltd 5,478,760 0.76 10 Phillip Securities Pte Ltd 4,884,789 0.68 11 Merrill Lynch (Singapore) Pte Ltd 4,045,532 0.56 12 OCBC Securities Private Ltd 3,116,040 0.43 13 ING Nominees Singapore Pte Ltd 2,675,667 0.37 14 OCBC Nominees Singapore Pte Ltd 2,455,248 0.34 15 Kim Eng Securities Pte. Ltd. 1,963,912 0.27 16 BNP Paribas Nominees Singapore Pte Ltd 1,821,978 0.25 17 Selat Pte Limited 1,691,972 0.23 18 DBS Vickers Securities (Singapore) Pte Ltd 1,616,245 0.22 19 Hong Leong Finance Nominees Pte Ltd 1,091,000 0.15 20 Island Investment Company Pte Ltd 904,718 0.13 Total 597,234,442 82.79

Substantial Shareholders Number of Shares %

1 Temasek Holdings (Pte) Ltd (Deemed interest) 380,154,241 52.70 2 Keppel Corporation Limited (Including holdings by subsidiary companies) 379,697,733 52.64

Temasek Holdings (Pte) Ltd holds 21.70% in the share capital of Keppel Corporation Limited, and is deemed to be interested in the shares of Keppel Land Limited held by Keppel Corporation Limited.

Approximately 47% of the issued shares of Keppel Land Limited are held by the public. Accordingly, Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited has been complied with.

Keppel Land Limited 228 Report to Shareholders 2008 Notice of Annual General Meeting

Keppel Land Limited Company Registration No. : 189000001G (Incorporated in the Republic of Singapore)

NOTICE IS HEREBY GIVEN that the Annual General Meeting of the ordinary shareholders of the Company will be held at Four Seasons Hotel, Four Seasons Ballroom, 2nd Floor, 190 Orchard Boulevard, Singapore 248646 on Friday, 24 April 2009 at 11.00 a.m. (or as soon thereafter as the Extraordinary General Meeting of the Company to be held at 10.30 a.m. on the same day and at the same place, is concluded or adjourned (the “EGM”, which expression shall include any adjournment thereof)) to transact the following businesses :

AS ORDINARY BUSINESS

1. To receive and adopt the Directors’ Report and Audited Accounts for the year ended 31 December 2008. (Resolution 1)

2. That contingent upon the approval of the proposed addition of the new Article to the Articles of Association of the Company in relation to the proposed Keppel Land Dividend Reinvestment Scheme (the “Dividend Reinvestment Scheme”) by shareholders of the Company at the EGM, to declare a final dividend of 8 cents per share for the year ended 31 December 2008 (2007: final dividend of 8 cents per share and special dividend of 12 cents per share) to which the Dividend Reinvestment Scheme shall apply. (Resolution 2)

3. To re-elect the following Directors, each of whom will retire pursuant to Article 94 of the Company’s Articles of Association and who, being eligible, offer themselves for re-election (see Note 2) :

Mr. Khor Poh Hwa (Resolution 3) Mrs. Lee Ai Ming (Resolution 4) Mr. Choo Chiau Beng (Resolution 5) Mr. Teo Soon Hoe (Resolution 6)

4. To approve Directors’ fees of $685,000 for the year ended 31 December 2008 (2007: $679,000). (Resolution 7)

5. To re-appoint Messrs Ernst & Young as Auditors, and to authorise the Directors to fix their remuneration.( Resolution 8)

AS SPECIAL BUSINESS

6. To consider and, if thought fit, approve with or without modification, the following resolutions which will be proposed as Ordinary Resolutions:

Notice of Annual General Meeting 229 Notice of Annual General Meeting

6.1 That:

(1) pursuant to Section 161 of the Companies Act, Cap. 50 of Singapore (the “Companies Act”), Rule 806 of the listing manual (“Listing Manual”) of the SGX-ST, and Article 8(B) of the Company’s Articles of Association, authority be and is hereby given to the Directors of the Company to:

(a) (i) issue shares in the capital of the Company (“Shares”), whether by way of rights, bonus or otherwise, and including any capitalisation pursuant to Article 136 and/or Article 136A of the Company’s Articles of Association of any sum for the time being standing to the credit of any of the Company’s reserve accounts or any sum standing to the credit of the profit and loss account or otherwise available for distribution; and/or

(ii) issue convertible securities (including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other securities convertible into Shares),

of not more than 50% of the total number of Shares (excluding treasury shares), of which the aggregate number of Shares and convertible securities issued other than on a pro rata basis to existing shareholders must not be more than 20% of the total number of Shares (excluding treasury shares), at any time and upon such terms and conditions and for such purposes as the Directors may in their discretion deem fit;

(b) (notwithstanding that the authority so conferred by this Resolution may have ceased to be in force) issue Shares in pursuance of any convertible securities made or granted by the Directors of the Company while the authority was in force;

(2) (subject to such manner of calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate number of Shares (excluding treasury shares) that may be issued under sub-paragraph (1)(a) above, the percentage of issued Shares shall be calculated based on the total number of Shares (excluding treasury shares) at the time of passing of this Resolution after adjusting for:

(a) new Shares arising from the conversion or exercise of convertible securities;

(b) new Shares arising from exercising share options or vesting of share awards outstanding or subsisting as at the date of the passing of this Resolution, provided the options or awards were granted in compliance with Part VIII of Chapter 8 of the Listing Manual; and

(3) the 50% limit in sub-paragraph (1)(a) above may be increased to 100% for the Company to undertake pro rata renounceable rights issues;

(4) in exercising the authority granted under this Resolution, the Company shall comply with the provisions of the Companies Act, the Listing Manual for the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association for the time being of the Company;

Keppel Land Limited 230 Report to Shareholders 2008 (5) (unless revoked or varied by the Company in general meeting) the authority conferred by this Resolution shall continue in force until the conclusion of the next annual general meeting of the Company or the date by which the next annual general meeting is required by law to be held, whichever is the earlier (see Note 3) (Resolution 9);

(6) subject to and pursuant to the share issue mandate in Resolution 9 being obtained, authority be and is hereby given to the Directors to issue new Shares other than on a pro rata basis to shareholders of the Company at an issue price per new Share which shall be determined by the Directors in their absolute discretion provided that such price shall not represent more than a 20% discount for new Shares to the weighted average price per Share determined in accordance with the requirements of the SGX-ST (see Note 4) (Resolution 10); and

(7) contingent upon the approval of the addition of the proposed new Article to the Articles of Association of the Company by shareholders of the Company at the EGM, approval be and is hereby given to the Directors of the Company, for the purposes of, in connection with or where contemplated by the Dividend Reinvestment Scheme to:

(a) allot and issue from time to time, such number of Shares in the capital of the Company, and/or

(b) notwithstanding that the authority conferred by this Resolution may have ceased to be in force, allot and issue such number of Shares in the capital of the Company pursuant to the application of the Dividend Reinvestment Scheme to any dividend which was approved while the authority conferred by this Resolution was in force,

at any time and upon such terms and conditions and to or with such persons as the Directors of the Company may, in their absolute discretion, deem fit (see Note 5).( Resolution 11)

Notice of Annual General Meeting 231 Notice of Annual General Meeting

6.2 (1) That for the purposes of the Companies Act, the exercise by the Directors of the Company of all the powers of the Company to purchase or otherwise acquire issued ordinary Shares fully paid in the capital of the Company not exceeding in aggregate the Maximum Limit (as hereafter defined), at such price(s) as may be determined by the Directors of the Company from time to time up to the Maximum Price (as hereafter defined), whether by way of:

(a) market purchase(s) (each a “Market Purchase”) on the SGX-ST; and/or

(b) off-market purchase(s) (each an “Off-Market Purchase”) in accordance with any equal access scheme(s) as may be determined or formulated by the Directors as they consider fit, which scheme(s) shall satisfy all the conditions prescribed by the Companies Act;

and otherwise in accordance with all other laws and regulations, including but not limited to, the provisions of the Companies Act and listing rules of the SGX-ST as may for the time being be applicable, be and is hereby authorised and approved generally and unconditionally (the “Share Purchase Mandate”);

(2) unless varied or revoked by the members of the Company in a general meeting, the authority conferred on the Directors of the Company pursuant to the Share Purchase Mandate may be exercised by the Directors of the Company at any time and from time to time during the period commencing from the date of the passing of this Ordinary Resolution and expiring on the earlier of:

(a) the date on which the next annual general meeting of the Company is held or required by law to be held; or

(b) the date on which the purchases or acquisitions of Shares by the Company pursuant to the Share Purchase Mandate are carried out to the full extent mandated;

Keppel Land Limited 232 Report to Shareholders 2008 (3) in this Ordinary Resolution:

“Maximum Limit” means that number of issued Shares representing 10% of the total number of Shares of the Company as at the date of the last annual general meeting or at the date of the passing of this Ordinary Resolution, whichever is higher, unless the Company has effected a reduction of the share capital of the Company in accordance with the applicable provisions of the Companies Act, at any time during the Relevant Period (as hereafter defined), in which event the total number of issued Shares of the Company shall be taken to be the total number of issued Shares of the Company as altered (excluding any treasury Shares that may be held by the Company from time to time);

“Relevant Period” means the period commencing from the date on which the last annual general meeting was held and expiring on the date the next annual general meeting is held or is required by law to be held, whichever is the earlier, after the date of this Ordinary Resolution; and

“Maximum Price”, in relation to a Share to be purchased or acquired, means the purchase price (excluding brokerage, stamp duties, commission, applicable goods and services tax and other related expenses) which is:

(a) in the case of a Market Purchase, 105% of the Average Closing Price (as hereafter defined); and

(b) in the case of an Off-Market Purchase pursuant to an equal access scheme, 120% of the Average Closing Price,

where:

“Average Closing Price” means the average of the closing market prices of a Share over the last five (5) Market Days (a “Market Day” being a day on which the SGX-ST is open for trading in securities), on which transactions in the Shares were recorded, in the case of Market Purchases, before the day on which the purchase or acquisition of Shares was made and deemed to be adjusted for any corporate action that occurs after the relevant five (5) Market Days, or in the case of Off-Market Purchases, before the date on which the Company makes an announcement of the offer; and

(4) the Directors of the Company and/or any of them be and are hereby authorised to complete and do all such acts and things (including without limitation, executing such documents as may be required) as they and/or he may consider necessary, expedient, incidental or in the interest of the Company to give effect to the transactions contemplated and/or authorised by this Ordinary Resolution (see Note 6). (Resolution 12)

Notice of Annual General Meeting 233 Notice of Annual General Meeting

6.3 (1) That approval be and is hereby given for the purposes of Chapter 9 of the Listing Manual of the SGX-ST, for the Company, its subsidiaries and target associated companies (as defined in the circular to shareholders dated 26 March 2009 (the “Circular”)), or any of them, to enter into any of the transactions falling within the types of Interested Person Transactions described in the Circular with any person who falls within the classes of Interested Persons described in the Circular, provided that such transactions are made on normal commercial terms and in accordance with the review procedures for Interested Person Transactions as set out in the Circular (the “IPT Mandate”);

(2) the IPT Mandate shall, unless revoked or varied by the Company in general meeting, continue in force until the date that the next annual general meeting of the Company is held or is required by law to be held, whichever is earlier;

(3) the Audit Committee of the Company be and is hereby authorised to take such action as it deems proper in respect of such procedures and/or to modify or implement such procedures as may be necessary to take into consideration any amendment to Chapter 9 of the Listing Manual of the SGX-ST which may be prescribed by the SGX-ST from time to time; and

(4) the Directors of the Company and/or any of them be and are hereby authorised to complete and do all such acts and things (including, without limitation, executing all such documents as may be required) as they and/or he may consider necessary, expedient, incidental or in the interest of the Company to give effect to the IPT Mandate and/ or this Ordinary Resolution (see Note 7). (Resolution 13)

7. To transact such other business which can be transacted at the annual general meeting of the Company.

NOTICE IS ALSO HEREBY GIVEN that the electronic copy of the Company’s Annual Report 2008 will be published on the Company’s website on 9 April 2009. The Company’s website address is http://www.keppelland.com.sg/ar2008.

By Order of the Board

Choo Chin Teck Yeo Kah Tiang Joint Company Secretaries

Singapore, 26 March 2009

Keppel Land Limited 234 Report to Shareholders 2008 Notes: 1. A Member is entitled to appoint one proxy or two proxies to attend and vote in his place. A proxy need not also be a Member of the Company. The instrument appointing a proxy must be deposited at the registered office of the Company at 230 Victoria Street #15-05, Bugis Junction Towers, Singapore 188024, not less than 48 hours before the time appointed for holding the annual general meeting.

2. Detailed information about these Directors can be found in the Board of Directors, and Profile of Directors and Senior Management sections of the Company’s Annual Report for the financial year ended 31 December 2008. Mr. Khor Poh Hwa will upon re-election, continue to serve as member of the Nominating Committee, Board Risk Committee and Board Safety Committee. Mrs. Lee Ai Ming will upon re-election, continue to serve as member of the Audit Committee and Board Safety Committee. Mr. Choo Chiau Beng and Mr. Teo Soon Hoe will upon re-election, continue to serve as non-executive Directors. These Directors (other than Messrs Choo Chiau Beng and Teo Soon Hoe) are considered by the Nominating Committee to be independent Directors.

3. Ordinary Resolution 9 is to empower the Directors from the date of the annual general meeting until the date of the next annual general meeting to issue further Shares and convertible securities, including a bonus or rights issue. The maximum number of Shares which the Directors may issue under this Resolution shall not exceed the quantum set out in Resolution 9.

4. Ordinary Resolution 10 is to empower the Directors from the date of the annual general meeting until the date of the next annual general meeting to issue new Shares other than on a pro rata basis to shareholders of the Company at an issue price per new Share where such issue price shall not represent more than a 20% discount for new Shares to the weighted average price per Share determined in accordance with the requirements of the SGX-ST.

5. Ordinary Resolution 11 is to empower the Directors to allot and issue Shares in the capital of the Company pursuant to or as contemplated by the terms and conditions of the Dividend Reinvestment Scheme. The approval of shareholders at the EGM is being sought for the addition of a new Article to the Articles of Association of the Company to facilitate the implementation of the Dividend Reinvestment Scheme. Please refer to the circular to shareholders dated 26 March 2009 in relation to the Dividend Reinvestment Scheme and the addition of the new Article for details.

6. Ordinary Resolution 12 relates to the renewal of the Share Purchase Mandate which was originally approved by shareholders on 5 October 1999 and was last renewed at the annual general meeting of the Company on 25 April 2008. Please refer to Appendix A of the circular to shareholders dated 26 March 2009 for details.

7. Ordinary Resolution 13 relates to the renewal of a mandate first given by shareholders on 25 June 1997 allowing the Company, its subsidiaries and target associated companies to enter into transactions with interested persons as defined in Chapter 9 of the Listing Manual of the SGX-ST. Please refer to Appendix B of the circular to shareholders dated 26 March 2009 for details.

Notice of Annual General Meeting 235 Share Transaction Statistics

Comparative Price Trends

Keppel Land Straits Times Index FTSE ST Real Estate Index Closing Normalised Closing Normalised Closing Normalised Month End Price (S$) Values Index Values Index Values

Jan 08 6.22 100.00 2982 100.00 773 100.00 Feb 08 5.90 94.86 3026 101.48 791 102.33 Mar 08 5.55 89.23 3007 100.84 767 99.22 Apr 08 6.06 97.43 3148 105.57 801 103.62 May 08 5.33 85.69 3193 107.08 793 102.59 Jun 08 4.96 79.74 2948 98.86 705 91.20 Jul 08 4.88 78.46 2930 98.26 698 90.30 Aug 08 3.88 62.38 2740 91.88 603 78.01 Sep 08 2.83 45.50 2359 79.11 468 60.54 Oct 08 1.85 29.74 1794 60.16 377 48.77 Nov 08 1.37 22.03 1733 58.12 349 45.15 Dec 08 1.70 27.33 1762 59.09 372 48.12 Jan 09 1.44 23.15 1746 58.55 340 43.98

Normalised Values 120

110

100

20 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

Keppel Land Straits Times Index FTSE ST Real Estate Index

Keppel Land Limited 236 Report to Shareholders 2008 Share Prices and Turnover Share Prices (S$) 120 12

100 10

80 8

60 6

40 4

20 2

0 0 2004 2005 2006 2007 2008 2009

Turnover High and Low Prices

Straits Times and FTSE Real Estate Indices Index 4000 3500 3000 2500 2000 1500 1000 500 0 2004 2005 2006 2007 2008 2009 Straits Times Index FTSE Real Estate Index

Investor Data 2004 2005 2006 2007 2008

Earnings per share (cents) (Note 1) 18.7 21.8 27.9 108.3 31.6 Dividend per share (cents) (Note 2) 5 5 6 8 8 Special dividend per share/distribution in specie (Note 3) - - 44 12 - Share price (cents) (Note 4) Highest 226 428 710 960 724 Lowest 147 224 360 655 131 Average 184 300 486 831 421 Last done 225 366 690 728 170 Turnover (million shares) 414.0 560.2 694.7 942.2 794.7 Dividend yield (%) (Note 5) 2.7 1.7 1.2 1.0 1.9 Dividend yield with special dividend (%) (Note 5) 2.7 1.7 10.3 2.4 1.9 Net price-earnings ratio (Note 5) 9.8 13.8 17.4 7.7 13.3 Net tangible assets per share ($) 2.26 2.35 2.21 3.18 3.39

Notes 1 Earnings represent Group attributable profits 2 For 2004 and 2005, these are gross dividends declared out of taxed profits. For 2006 to 2008, these are one-tier tax exempt. 3 The special dividend for 2006 refers to distribution in specie and it consists of 37 cents (less tax 20%) of taxed dividend and 7 cents of one-tier tax exempt dividend. 4 Share prices reflect transactions recorded on the Singapore Exchange Securities Trading Limited. 5 In calculating dividend yields and net price-earnings ratios, the average share prices have been used.

Share Transaction Statistics 237 This page is intentionally left blank. Proxy Form IMPORTANT:

1. For investors who have used their CPF monies to buy KEPPEL LAND LIMITED shares, this report is forwarded to them at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION ONLY. Keppel LandLand Limited Limited 2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all Co Reg No: 189000001G intents and purposes if used or purported to be used by them. (Incorporated in the Republic of Singapore) 3. CPF investors who wish to attend the Annual General Meeting as observers must submit their requests through their CPF Approved Nominees within the time frame ANNUAL GENERAL MEETING specified. Any voting instructions must also be submitted to their CPF Approved Nominees within the time frame specified to enable them to vote on the CPF investors’ behalf.

I / We (name) of (address) (address)being (a) Member(s)being (a) Shareholder of Keppel Land (s) of Limited Keppel (theLand “Company”), Limited (the hereby “Company” appoint: ), hereby appoint:

Name AddressAddress NNRIC/RIC/ ProportionProportion ofof PassportPassport Number ShareholdingsShareholdings

No. of Shares % No. of Shares %

and and / or/ or (delete (delete as as appropriate) appropriate)

Name Address NRIC/ Proportion of Passport Number Shareholdings as my / our proxy / proxies to vote on my / our behalf at the Annual General Meeting of the Company to be heldNo. ofon Shares 24th day of April% 2009 at 11.00 a.m. at Four Seasons Hotel, Four Seasons Ballroom, 2nd Floor, 190 Orchard Boulevard, Singapore 248646. I / We direct my / our proxy / proxies to vote for or against the Resolutions to be proposed at the Meeting as hereunder indicated.

To be Used on a To be Used in the as my / our proxy / proxies to vote on my / our behalf at the Annual General MeetingShow of of Hands the Company Event to be of helda Poll on No. Resolution

25th day of April 2008 at 10.30 a.m. I / We direct my / our proxy / proxies to vote (see Note 4) for or against the Fold and glue along dotted line For* Against* Number Number Resolutions to be proposed at the Meeting as hereunder indicated. of Votes of Votes for** against** To be Used on a To be Used in the Ordinary Business Show of Hands Event of a Poll No. Resolution 1. To receive and adopt the Directors’ Report and Audited Accounts for the For* Against* Number Number year ended 31 December 2008 of Votes of Votes 2. To approve the declaration of a final dividend of 8 cents per share as for** against** recommended by the Directors for the financial year ended 1. To receive and adopt the Directors’ Report and Accounts for the year ended Fold and glue along dotted line 31 December 20072008 (2007: final dividend of 8 cents per share and special dividend of 12 cents per share) 2. To declare the final dividend and special dividend as recommended 3. byTo re-electthe Directors Mr Khor for thePoh year Hwa ended as Director 31 December 2007 4. (2006:To re-elect $43,178,000 Mrs Lee Ai ) Ming as Director 3.5. To re-elect Mr LimChoo Chee Chiau Onn Beng as Directoras Director 6. To re-elect Mr Teo Soon Hoe as Director 4. To re-elect Mr Lim Ho Kee as Director 7. To approve Directors’ fees of $685,000 for the year ended 5. To re-elect Prof Tsui Kai Chong as Director 31 December 2008 (2007: $679,000) 8.6. To re-appointre-elect Mr MessrsTan Yam Ernst Pin as& YoungDirector as Auditors, and to authorise the 7. DirectorsTo re-elect to Mr fix Heng their Chiangremuneration Meng as Director 8.Special To approveBusiness Directors’ fees of $679,000 for 2007 9. To(2006: approve $637,000) the authority to issue shares and convertible securities 9. pursuantTo re-appoint to Section Messrs 161 Ernst of the& Young Companies as Auditors, Act, Cap. and 50to authoriseof Singapore the 10. ToDirectors approve to thefix authoritytheir remuneration to issue new shares other than on a pro rata basis 10. toTo shareholdersapprove the Ordinaryat an issue Resolution price per pursuant new share to Sectionwhich represents 161 of the not moreCompanies than a Act20% discount to the weighted average price per share 11. To approve theOrdinary allotment Resolution and issue pursuant of shares to Share pursuant Purchase to the MandateDividend 12. ToReinvestment approve Ordinary Scheme Resolution pursuant to IPT Mandate 12. To approve the renewal of the Share Purchase Mandate * Please indicate your vote “For” or “Against” with an “X” within the box provided. ** 13. If you To wish approve to exercise the all renewal your votes of “For” the orIPT “Against”, Mandate please indicate with an “X” within the box provided. Alternatively, please indicate the number of votes as appropriate. * Please indicate your vote “For” or “Against” with a “√” within the box provided. ** If you wish to exercise all your votes “For” or “Against”, please indicate with a “√” within the box provided. Alternatively, please indicate the number of votes Datedas appropriate. this ______day of ______2008

Dated this ______day of ______2009 Total Number Shares in: No. of Shares (a) CDP Register (b) Register of Members Signature(s) or Common Seal of Member(s) Signature(s) of Member(s) / Common Seal

# IMPORTANT:IMPORTANT: PleasePlease read read the the notes notes overleaf overleaf before before completing completing this this Proxy Proxy Form Form

Fold and glue along dotted line Notes for Proxy Form

1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Cap. 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should insert that number of shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all Shares held by you.

2. A member entitled to attend and vote at the Meeting is entitled to appoint one or two proxies to attend and vote in his stead. A proxy need not be a Member of the Company. Where a Member appoints more than one proxy, he shall specify the proportion of his shareholding to be represented by each proxy. If no such proportion or number is specified, the first named proxy shall be deemed as representing 100.0% of the shareholding and the second named proxy shall be deemed as an alternate to the first named.

3. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the Meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy, to the Meeting.

Fold along this line (1)

Affix Postage Stamp

The Company Secretary Keppel Land Limited 230 Victoria Street #15-05 Bugis Junction Towers Singapore 188024

Fold along this line (2)

4. The instrument appointing a proxy or proxies must be deposited at the Company’s registered office at 230 Victoria Street #15-05, Bugis Junction Towers, Singapore 188024 not less than 48 hours set for the Meeting.

5. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its common seal or under the hand of its attorney or duly authorised officer.

6. Where an instrument appointing a proxy is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified copy thereof must (failing previous registration with the Company) be lodged with the instrument of proxy, failing which the instrument may be treated as invalid.

7. The Company shall be entitled to reject an instrument of proxy which is incomplete, improperly completed, illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified on the instrument of proxy. In addition, in the case of Shares entered in the Depository Register, the Company may reject an instrument of proxy if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.