CDL Annual Report 2019
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INSPIRED CITY DEVELOPMENTS LIMITED I ANNUAL REPORT 2019 CORPORATE PROFILE City Developments Limited (CDL) is a leading global real estate company with a network spanning 106 locations GET in 29 countries and regions. Listed on the Singapore Exchange, the Group INSPIRED is one of the largest companies by market capitalisation. Its income-stable and geographically-diverse portfolio comprises residences, offi ces, hotels, serviced apartments, shopping malls and At CDL, we are inspired to shape the integrated developments. future of real estate with innovation, creativity and passion to create unique With a proven track record of over spaces that excite and enrich lives. 55 years in real estate development, investment and management, the GET Group has developed over 46,000 Our strategy — focusing on homes and owns over 24 million square Growth, Enhancement and feet of gross fl oor area in residential, Transformation, inspires us to challenge commercial and hospitality assets globally. convention and chart our growth Its diversifi ed global land bank off ers 3.4 million square feet of land area. trajectory. With an innovative spirit, we constantly reinvent tomorrow’s Along with its London-based hotel arm, landscapes in this age of disruption, Millennium & Copthorne Hotels Limited building on our strengths to unlock (M&C), the Group has 156 hotels and opportunities and create sustained 45,000 rooms worldwide, many in key gateway cities. value for our investors and stakeholders. Leveraging its deep expertise in As we continue to inspire our built developing and managing a diversifi ed environment with architectural asset base, the Group is focused on enhancing the performance of its breakthroughs, we stand ready to portfolio and strengthening its recurring push boundaries and turn promising income streams to deliver long-term possibilities into long-term growth. sustainable value to shareholders. The Group is also developing a fund management business and targets to achieve US$5 billion in Assets Under Management (AUM) by 2023. OVERVIEW CORPORATE GOVERNANCE BUSINESS OVERVIEW OTHER INFORMATION 12 2019 Highlights 26 Board of Directors 76 Financial Review 264 Statistics of Ordinary Shareholdings 13 5-Year Financial Highlights 30 Key Management Personnel 78 Operations & Market Review 266 Statistics of Preference Shareholdings 14 Chairman’s Statement 32 Corporate Governance 267 Share Transaction Statistics 17 Group CEO’s Statement 55 Risk Management PROPERTY PORTFOLIO 268 Notice of Annual General Meeting 20 Corporate Network 61 Investor Relations 84 Property Portfolio Analysis A1 Additional Information on 21 Corporate Structure 62 Calendar of Financial Events 87 Major Properties Directors Seeking Re-Election 22 Highlights of the Year Proxy Form 24 Awards & Accolades SUSTAINABILITY FINANCIALS Cover: Facing: 25 Corporate Directory 63 Sustainability Board Statement 97 Statutory Reports and Accounts Republic Plaza Amber Park Singapore Singapore Artist’s Impression ACQUISITIONS & INVESTMENTS $2.3 BILLION IN SINGAPORE & KEY MARKETS GROWTH PROPERTY DEVELOPMENT SINGAPORE: OVERSEAS: 6 LAUNCHES 4 LAUNCHES BOULEVARD 88, AMBER PARK, HANS ROAD (LONDON), SYDNEY STREET (LONDON), GROWING HAUS ON HANDY, PIERMONT GRAND, THE MARKER (MELBOURNE), WATERBROOK BOWRAL (SYDNEY) NOUVEL 18, SENGKANG GRAND RESIDENCES OUR GLOBAL SOLD EXPANSION INTO RENTAL APARTMENT SEGMENT 1,554 UNITS £15.4 MILLION ¥5.46 BILLION FOOTPRINT WITH SALES VALUE OF ACQUISITION OF ACQUISITION OF PRIVATE RENTED SECTOR SITE FOUR RENTAL APARTMENT PROJECTS $3.3 BILLION IN LEEDS, UK IN OSAKA, JAPAN In 2019, we grew our portfolio with about $2.3 billion of acquisitions and investments in Singapore and our key overseas markets of China, UK, Japan and Australia. With the successful launch of a record six residential projects in Singapore, we have demonstrated our development and execution capabilities, emerging as one of the top-selling private sector developers in Singapore. We also expanded into the Private Rented Sector in the UK and Japan, investing in high quality built-to-rent projects that will enhance our recurring income. Amber Park Singapore Artist’s Impression ASSET ENHANCEMENTS COMPLETED SINGAPORE: $70 MILLION ENHANCEMENT REFURBISHMENT OF REPUBLIC PLAZA GLOBAL PORTFOLIO OVERSEAS: ENHANCING £60 MILLION >24 MILLION SQ FT REFURBISHMENT OF OUR ASSET THE BILTMORE MAYFAIR TOTAL GROSS FLOOR AREA HOTEL IN LONDON OF OFFICE, INDUSTRIAL, RETAIL, RESIDENTIAL AND HOTEL SPACE PORTFOLIO AEI PLANS: A $70 million asset enhancement initiative - PALAIS RENAISSANCE (AEI) for Republic Plaza, our flagship - JUNGCEYLON (PHUKET) building in Raffles Place was completed - CITY INDUSTRIAL BUILDING - CIDECO INDUSTRIAL COMPLEX in 2019. It now showcases an iconic 1,800 sq ft digital wall in its lobby – Singapore’s largest UHD LED wall in an office building, a refreshed retail enclave and other innovative features such as a smart building mobile app. The enhanced asset achieved positive rental reversions of 10% post-AEI. Over in the UK, we completed a £60 million refurbishment of our Mayfair property in London into a five-star deluxe hotel, rebranded as The Biltmore Mayfair, under Hilton’s LXR Hotels & Resorts collection. It re-opened in September 2019. We continue to focus on asset renewal and portfolio enhancement as the key pillars of our GET strategy to drive operational efficiency and strengthen recurring income. Republic Plaza Singapore TRANSFORMATION TRANSFORMING THROUGH DIVERSIFIED PLATFORMS To better position ourselves for the future, we must continually explore growth opportunities and strategically invest in key markets with the acquisition of assets and platforms that complement our business transformation and expand our footprint. We will continue to embrace innovation and capitalise on new economy and technology ventures that will revolutionise our product offerings and enhance our value proposition. These new platforms, coupled with our fund management ambitions will steer our business transformation into the future. FUND MANAGEMENT US$5 BILLION AUM TARGET BY 2023 GROUP’S TOTAL ASSETS STRATEGIC INVESTMENT IN REIT PLATFORM $23.2 BILLION $77.8 MILLION INCREASED BY 12.5% INITIAL INVESTMENT IN SINGAPORE-LISTED IREIT GLOBAL Darmstadt Campus Frankfurt, Germany ATION M TRANSFOR REJUVENATING OUR GLOBAL HOSPITALITY PORTFOLIO: HOSPITALITY 156 hotels PORTFOLIO 45,000 rooms Following the successful privatisation of our London-based hospitality arm, Millennium & Copthorne Hotels Limited (M&C) is now the Group’s wholly-owned subsidiary. We have embarked on an integration process to drive synergies and achieve sustainable hotel performance. Beyond portfolio rejuvenation, we continue to focus on unlocking value through SUCCESSFUL enhancing operational efficiency PRIVATISATION and leveraging the Group’s core OF M&C BASED ON competencies in real estate £2.23 BILLION development and asset management. VALUATION HOSPITALITY ASSETS $6 BILLION The Biltmore Mayfair London, UK LISTED ON 12 GLOBAL SUSTAINABILITY RANKINGS AND INDEXES INCLUDING: RANKED WORLD’S TOP REAL ESTATE FIRM, TOP SINGAPORE COMPANY, AND ONLY SINGAPORE COMPANY LISTED ON GLOBAL 100 SUSTAINABILITY FOR 11 CONSECUTIVE YEARS ONLY COMPANY IN SOUTHEAST ASIA AND HONG KONG TO SCORE DOUBLE ‘A’S FOR BOTH CORPORATE CLIMATE ACTION CHANGING AND WATER SECURITY THE CLIMATE. SINGAPORE GOVERNANCE AND TRANSPARENCY INDEX 2019 #5 OUT OF 578 COMPANIES CHANGING THE FUTURE. – BUILDING SUSTAINABLE CITIES & COMMUNITIES Environmental, Social and Governance (ESG) integration has continued to be a cornerstone of our corporate ethos and business practices. We have remained proactive in our strategies to address the more rigorous global call for climate action, lower carbon footprint and sustainable development. Our unwavering ESG commitment for over two decades has not only helped us to mitigate climate risks, but also enabled us to meet rising investor expectations and open new growth opportunities by tapping on fast-growing sustainable investment and finance through adaptation and innovation. We are on track to achieving our Future Value GREEN FINANCING MILESTONES: ACHIEVED ENERGY SAVINGS OF 110 BCA 2030 targets that are aligned with the United $500 MILLION >$28 MILLION GREEN MARK Nations Sustainability Development Goals GREEN LOANS FOR 8 COMMERCIAL PROPERTIES (SDGs) and the Task Force on Climate-related DEVELOPMENTS AND OFFICE INTERIORS FROM 2012 TO 2019 SINGAPORE’S FIRST GREEN LOANS - HIGHEST AMONGST LOCAL DEVELOPERS Financial Disclosures (TCFD) framework. FOR NEW PROPERTY DEVELOPMENTS We will continue to strengthen our value chain engagement for a more sustainable future for all. $250 MILLION 38% REDUCTION CDL FUTURE VALUE SDG INNOVATION LOAN IN CARBON EMISSIONS INTENSITY 2030 BLUEPRINT FROM 2007 LEVELS FIRST-OF-ITS-KIND TO ACCELERATE – ON TRACK TO ACHIEVING ESG GOALS INNOVATIVE SOLUTIONS AND EXPANDED SUPPORT FOR 14 SDGS Piermont Grand Singapore PLATINUM Artist’s Impression 2019 5-YEAR HIGHLIGHTS FINANCIAL HIGHLIGHTS REVENUE EBITDA Year 2015 2016 2017 (1) 2018 2019 $3.4 $1.1 For the financial year ($’million) Revenue 3,304 3,905 3,829 4,223 3,429 BILLION BILLION Profit before tax 985 914 763 876 754 Profit for the year attributable to owners $4.2 BILLION IN 2018 $1.2 BILLION IN 2018 of the Company (PATMI) 773 653 522 557 565 At 31 December ($’million) PATMI TOTAL ASSETS Property, plant and equipment 5,175 5,136 4,999 5,013 5,462 Investment properties 2,584 2,346 2,449 3,741 4,410 $564.6 $23.2 Development properties 5,515 5,209 4,308 5,704 5,156 Cash and bank balances (including