Lippo Malls Indonesia Retail Trust
Total Page:16
File Type:pdf, Size:1020Kb
Strictly confidential Lippo Malls Indonesia Retail Trust Investors Presentation Nomura Asia Equity Forum– June 2012 Executive summary LMIRT is a Singapore-listed REIT with prime retail assets in Indonesia Burgeoning Target Market… …Accessed via… …A Stable Platform Growing Indonesian Middle Income Segment A Dominant Sponsor and Diversified Portfolio Highly Regulated and Prudently Run S-REIT Macro Environment Sponsor – Lippo Karawaci Operating Platform . South East Asia’s largest economy at nominal . LMIRT enjoys benefits from being part of the . One of the most developed REIT markets in GDP and world’s 4th largest population Lippo Group with LPKR as its Sponsor. Asia Pacific with a robust regulatory framework . Strong Real GDP growth over 2008-2009 . The largest listed real estate company in . Strict external corporate governance rules in relative to Southeast Asia and GDP per capita Indonesia and the dominant retail space place re asset purchases / divestments, etc, growing at a 6.6% CAGR 2006 - 2011 landlord with ~25% market share including where related parties are involved . Middle income growth driving high private . 25 malls under management and 15 in the . Strong internal corporate governance and consumption at 55% in 2011 development pipeline experienced management and Board Retail / Malls Sector Portfolio of Malls and Retail Spaces Financial Strength . High forecast retail sales growth at c.13% for . Favorable lease profile anchored by top . Prudent financial management with strong 2012-16 with Retail Sales Index 7 year high domestic brands and international retail names credit metrics . Low space per capita at less than 5sft and . High average tenant retention rate of c. 80% . Cash balances cover significant portion of debt lowest rentals in the region also adds to the portfolio’s resilience with no debt maturities until 2014 . Characterised by high fragmentation, low rates . Occupancy rates improved during GFC in 2009 . Strong interest coverage with leverage at 8.7% of mall penetration and tenant demand vs. 2008 while sector occupancy rates dipped and c. 64% of assets unencumbered 1 Burgeoning Middle Class, Growing Retail Sector and Dominant Position Strong Indonesian macro fundamentals Resilient economy supported by strong domestic consumption and rising middle class GDP Nominal Growth (2009–2015) Burgeoning middle class Rising middle Indonesia 15.1% class Russia 14.9% 100% 8,000 India 13.7% 80% China 13.4% 6,000 60% Brazil 12.0% 4,000 South Korea 11.1% 40% (USD) Turkey 9.1% 2,000 20% Japan 4.6% USA 3.8% 0% 0 % of households by band by income households of % 1990 2000 2010 2015 ASEAN (Ex. Indonesia) 10.4% <5K USD 5K-10K USD disposable income household Annual 10K-15K USD >15K USD Source: International Monetary Fund, World Economic Outlook Average household disposable income (RHS) Database, September 2011. Source: CEIC, UBS research Consumption driven growth SEA‘s most resilient economy Others Stockbuilding 16.0 Global Financial Crisis 0.3% 3.7% 12.0 6.4 6.0 6.1 6.5 5.9 6.5 6.6 6.5 8.0 4.6 Gross fixed 5.5 investment Private 4.0 31.9% consumption 0.0 55.4% Real GDP growth (% growth(% GDP p.a.) Real (4.0) Government 2006 2007 2008 2009 2010 2011 2012f 2013f 2014f 2015f consumption Indonesia Malaysia Thailand Philippines Singapore 8.7% Source: EIU, Feb 2012 Source: EIU, Feb 2012 3 Attractive Indonesian retail sector High forecast retail growth coupled with low rental rates and retail space per capita imply excess capacity Jakarta is ‘under-malled’ Retail rental rates in Jakarta remain the lowest in the region Retail space per capita (sq ft) 20.0 16.4 Retail rental rates (US$ / sqm / annum) 15.0 6,000 9.7 9.9 10.0 7.2 7.4 4,500 4.7 4.7 5.3 5.0 3,000 0.0 1,500 Jakarta Metro Bangkok Singapore Klang Sydney Tokyo HK 0 Manila Valley (Malaysia) Kong Hong Hanoi Minh Beijing Kuala Ho Chi Ho Jakarta Lumpur Bangkok Shanghai Source: CIA World Factbook, Research reports (CBRE, Colliers, UBS research) Source: CBRE Singapore Fastest retail sales growth in the region Retail Sales Index Retail sales growth (2012F - 2016F) 350 16% 329.6 12.9% 300 12% 250 200 6.8% 8% 6.7% 150 3.5% 100 4% 2.3% 50 0 0% Indonesia Malaysia Thailand Philippines Singapore Jul-06 Jan-05Jun-05Oct-05Feb-06 Nov-06Apr-07Aug-07Jan-08May-08Sep-08Feb-09Jun-09Nov-09Mar-10Aug-10Dec-10May-11Sep-11 4 Leadership in the Indonesian retail sector Well-positioned as one of the biggest retail space owners in Indonesia Dominant domestic market share among Asian retail REITs/Sponsors 30.0% 25.0% 22.3% 20.0% 9.5% 10.0% 6.9% shopping center center space shopping % market market retail/ share of % 0.0% LPKR/LMIRT CMT/CMA Link REIT F&N/FCT Source: Company data, results announcements, Urbis report Increasing foreign direct investments in Indonesian retail sector Foreign retailer Home country Announced investments/growth plans in Indonesia France Carrefour Indonesia plans to set up 20 new outlets each year Plans to launch its first Metro cash-and-carry outlet in 2012 – to open about 20 retail outlets in Germany Indonesia Plans to open 4 to 5 stores in Indonesia p.a. in the next three years with an average investment per Malaysia store of ~ US$2.0m to US$3.0m South Korea Plans to increase the no. of Lotte Mart outlets from 24 to 45 by 2013 Source: BMI Indonesia Retail Report, PT Data Consult report on retail business in Indonesia (30 June 2011) 5 Diversified and Strategically Located Portfolio LMIRT’s portfolio overview LMIRT has a diversified portfolio of 10 retail malls and 7 Retail Spaces Metropolis Town Square . Diversified portfolio across Indonesia North Pluit Village West Jakarta Mall WTC Matahari – 6 retail malls across Greater Jakarta JakartaCentral Gajah Mada Plaza Plaza Medan Fair Jakarta The Plaza Semanggi – Jakarta, Bogor, Depok, Tangerang, Bekasi Sun Plaza South Grand Palladium Medan Jakarta Mal Lippo Cikarang Medan Depok Town Square – 2 malls each in Bandung and Medan Cibubur Junction Ekalokasari Plaza – 3rd and 4th most populous cities respectively . Located to access mid-to-upper middle income segment Kalimantan Sumatra Pontianak Balikpapan Sulawesi Portfolio key metrics Valuation Occupancy IrianJaya Malls NLA (sqm) 1 1 (S$m) rate (%) Java Supermall Jakarta Semarang Istana Plaza 1. Bandung Indah Plaza 29,505 128 98.6% Java Surabaya Bandung 2. Cibubur Junction 33,815 77 99.3% Malang Plaza Madiun Malang Town Square 3. Ekalokasari Plaza 25,458 53 88.9% Bandung Indah Plaza 4. Gajah Mada Plaza 35,187 110 97.8% Retail Malls 5. Istana Plaza 26,768 114 99.5% Acquisitions completed on 6 December 2011 Retail Spaces 6. Mal Lippo Cikarang 28,400 71 98.7% 7. The Plaza Semanggi 63,701 193 96.4% 8. Sun Plaza 63,962 199 99.6% Portfolio NLA breakdown (%)—as at 31 Dec 2011 9. Pluit Village 86,341 242 75.8% Others West JKT 10. Plaza Medan Fair 56,031 159 93.1% 8% 8% East JKT Bandung Central JKT Mall Portfolio 449,168 1,346 92.9% 28% 10% 11% Retail Spaces 94,070 199 100.0% Greater Total portfolio 543,238 1,545 94.1% Jakarta Total portfolio 98.2% Medan 58% South (excl. PV and PMF)2 25% JKT 3 Industry Average 87.6% 25% North JKT 1 As at 31 Dec 2011 2 Pluit Village and Plaza Medan Fair were acquired in Dec 2011 Source: Company data, Central Bureau of Statistcs (BPS), 2010 28% 3 Jones Lang Lasalle Jakarta Property Market Review 4Q 2011, Company announcements Census, Knight Frank/PT Willson Properti Advisindo 7 Diversified Tenant Mix, Strong WALE and Occupancy Tenant Breakdown Weighted Average Lease Expiry (based on NLA) Tenant type % of gross rental income Global Financial Specialty 37% Crisis 98.3% 98.2% Majors 36% 100% 95.7% 96.9% 92.8% Atrium leasing High average tenant 11% 94.1%1 retention rate of c. 80% also 87.6% Parking 6% 90% 86.3% adds to the resilience of 84.6% Other rental income LMIRT’s portfolio and 5% 82.2% demonstrates its strong Foodcourt 2% 78.1% tenant relationships 80% Temporary leasing 1% LMIRT occupancy rate (%) Occupancy rate (%) Occupancy Promotion 1% Industry avg. occupancy rate (%) 70% Miscellaneous 1% 2007 2008 2009 2010 2011 Net property income Tenant Breakdown Weighted(S$m) Average Lease Expiry (based on NLA) 45% Electronic Solution 0.5% 40% 38% Giant Super Store 0.5% The total weighted Gramedia 0.6% 35% average lease term for the portfolio is 4.5 years Solaria 0.6% 30% as at 31 March 2012 Timezone 0.6% 25% Centro 0.7% 20% Carrefour 1.6% 14% 15% 13% 10% Hypermart 2.7% 9% 10% Marahari (Retail Malls) 6.6% 4% 5% Matahari (Retail Spaces) 14.1% 0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 2012 2013 2014 2015 2016 >2017 Note: As at 31 March, 2012. The lease expiry profile of the portfolio includes the lease expiries from the 2 new properties, Pluit Village and Plaza Medan Fair 8 High portfolio occupancy – well above industry average LMIRT’s occupancy rate improved even during the financial crisis, demonstrating the underlying stability Net Property Income (S$m) . Strategically located malls and retail spaces underpinned by attractive shopper catchment 100 92.0 Ongoing tenant mix optimization to attract and . 85.3 maintain shopper traffic 80.0 75.1 . Strong relationships with high quality retailers 80 . Positioning as "everyday" one-stop destination malls focusing on necessity items boosts resilience 60 . Relatively stable net property income (“NPI”) levels during the crisis period .