Building Strengths

REPORT TO SHAREHOLDERS 2010

Building Strengths Deﬁ ning Distinction Sustaining Value Distinguishing Quality Enriching Lives To be the premier multi-national corporation providing urban living solutions through the twin core businesses of property development and property fund management.

We are committed to create live-work-play environments of enduring value for the community with our hallmark excellence, and achieve sustainable higher returns for our shareholders.

Contents 1 Key Figures 2010 116 Value Added Statement 2 Group Financial Highlights 118 Productivity Analysis 3 Five-Year Group Financial Profi le 120 Corporate Liquidity and 4 Group Quarterly Results Capital Resources 5 Corporate Profi le 122 Business Dynamics and Risk Factors 6 Chairman’s Statement 123 Critical Accounting Policies and 12 Key Messages Recommended Accounting Practice 18 Board of Directors 125 Sustainability Report 22 Senior Management Sustaining Growth 24 Key Personnel 126 – Corporate Governance 28 Investor Relations 142 – Risk Management 32 Corporate Milestones 144 – Environment 33 Awards and Accolades Empowering Lives 36 Special Feature 148 – Health and Safety – Offi ce Market Riding on 150 – People Upbeat Momentum Nurturing Communities Operations and Market Review 154 – Causes 42 Overview 158 Directors’ Report 44 Singapore 166 Statement by Directors 46 – Residential 167 Independent Auditors’ Report 52 – Commercial 168 Consolidated Profi t and Loss Account 62 Property Fund Management 169 Consolidated Statement of Overseas Comprehensive Income 68 – China 170 Balance Sheets 84 – Vietnam 171 Statements of Changes in Equity 90 – India 174 Consolidated Cash Flow Statement 94 – Indonesia 176 Notes to the Financial Statements 97 – Saudi Arabia 240 Signifi cant Subsidiary and 98 – The Philippines Associated Companies 100 – Thailand 245 Corporate Information 101 – Malaysia 246 Profi le of Directors and Regional Network Senior Management 102 – Asia Pacifi c and Middle East 253 Calendar of Financial Events 104 – Singapore 254 Corporate Structure 106 Financial Review 258 Property Portfolio 112 Property Portfolio Analysis 276 Statistics of Shareholdings 114 Sensitivity Analysis 278 Notice of Annual General Meeting 115 Economic Value Added 284 Share Transaction Statistics Proxy Form Key Figures 2010

Net Proﬁ t Dividend Per Share Economic Value Added $1b $0.18 $385m Net profit grew 273% and Dividend of 18 cents per share, Economic value added grew exceeded $1 billion. including a special dividend of significantly to $385 million 9 cents per share. from $81.7 million in 2009.

Grade A Ofﬁ ce Take-Up Residential Sales Residential Pipeline 1m sf 5,250 9,700 Total Grade A office take-up Record sales of more than Acquisition of strategic sites at Marina Bay Financial Centre 5,200 homes in Singapore added more than 9,700 units and Ocean Financial Centre and overseas, mostly in China. to current pipeline of over rose to over 1 million sf. 75,000 homes.

Net Debt-Equity Ratio Assets Under Management 0.2x $11.2b Maintained low net debt-equity Total assets under ratio of 0.2x for more management by property large-scale developments. fund management business amounts to about $11.2 billion, when fully leveraged and fully invested.

Key Figures 2010 1 Group Financial Highlights

% Increase/ 2010 2009 (Decrease) For the year ($’000) Sales 792,273 923,869 (14.2) Operating profi t 222,927 201,925 10.4 Pre-tax profi t Before fair value gain/(loss) on investment properties/impairment 757,333 370,541 104.4 After fair value gain/(loss) on investment properties/impairment 1,183,143 358,564 230.0 Net profi t 1,045,831 280,416 273.0 Funds (used in)/from operations (1,086,895) 515,939 n.m. Development expenditures 1,447,001 355,565 307.0 Capital expenditure on investment properties and fi xed assets 271,666 79,500 241.7 Proposed fi nal dividend 130,522 114,379 14.1 Proposed special dividend 130,522 – n.m. Total value added 919,000 516,400 78.0

At year-end ($’000) Shareholders’ equity 4,301,271 3,375,789 27.4 Non-controlling interests 339,051 412,813 (17.9) Long-term borrowings 2,199,669 903,570 143.4 Short-term borrowings 316,792 823,153 (61.5) Total funds invested 7,156,783 5,515,325 29.8

Per share Earnings (cents) (Note 1) After taxation but before fair value gain/(loss) on investment properties/impairment 44.6 22.6 97.3 After taxation and fair value gain/(loss) on investment properties/impairment 72.8 24.2 200.8 Proposed ﬁ nal dividend (cents) 9.0 8.0 12.5 Proposed special dividend (cents) 9.0 – n.m. Net tangible assets ($) 2.97 2.36 25.8

Financial ratios Return on shareholders’ equity (%) (Note 2) After taxation but before fair value gain/(loss) on investment properties/impairment 18.4 9.4 95.7 After taxation and fair value gain/(loss) on investment properties/impairment 30.0 10.1 197.0 Dividend cover (times) (Note 3) 4.9 2.3 113.0 Interest cover (times) (Note 4) 23.9 13.1 82.4 Net debt-equity ratio (times) (Note 5) 0.20 0.22 (9.1)

Employees (Note 6) Number (average) 2,835 2,650 7.0 Wages and salaries ($’000) 124,866 102,776 21.5 Pre-tax proﬁ t per employee ($’000) 205 78 162.8

Notes: 1. Earnings per share are calculated by reference to the weighted average number of shares in issue during the year. 2. In the calculation of return on shareholders’ equity, the weighted average basis has been used. 3. Dividend cover for 2010 is 2.5 times if the special dividend is included. 4. In the calculation of interest cover, fair value gain/(loss) 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 sale. 5. In the calculation of the net debt-equity ratio, net debt includes borrowings net of cash and equity includes non-controlling interests in subsidiary companies. 6. Wages and salaries include amounts capitalised under properties held for sale. In the calculation of pre-tax proﬁ t per employee, the share of results of associated companies and fair value gain/(loss) on investment properties/impairment are excluded. 7. n.m. – not meaningful

Keppel Land Limited 2 Report to Shareholders 2010 Five-Year Group Financial Profile

2006 2007 2008 2009 2010 Income statement ($’000) Sales 948,018 1,407,886 842,166 923,869 792,273 Operating profi t 204,082 312,269 231,744 201,925 222,927 Pre-tax profi t Before fair value gain/(loss) on investment properties/impairment 302,748 620,957 309,563 370,541 757,333 After fair value gain/(loss) on investment properties/impairment 263,408 988,736 314,030 358,564 1,183,143 Net profi t 200,310 779,650 227,669 280,416 1,045,831

Balance sheet ($’000) Fixed assets and investment properties 1,486,679 1,603,539 1,680,195 1,632,830 1,906,435 Investments 659,375 722,361 1,020,367 1,500,333 1,531,180 Non-current assets 753,216 737,182 813,824 940,708 446,161 Net current assets (Note 1) 1,586,846 1,986,073 1,630,825 1,539,977 3,375,828 Deferred taxation (34,438) (130,688) (126,459) (98,523) (102,821) Assets employed 4,451,678 4,918,467 5,018,752 5,515,325 7,156,783

Shareholders’ equity 1,590,934 2,291,231 2,442,560 3,375,789 4,301,271 Non-controlling interests 310,018 352,460 454,374 412,813 339,051 Long-term borrowings 2,111,107 1,955,914 1,937,767 903,570 2,199,669 Short-term borrowings 439,619 318,862 184,051 823,153 316,792 Total funds invested 4,451,678 4,918,467 5,018,752 5,515,325 7,156,783

Per share Earnings (cents) (Note 2) After taxation but before fair value gain/(loss) on investment properties/impairment 23.6 50.7 22.1 22.6 44.6 After taxation and fair value gain/(loss) on investment properties/impairment 19.8 76.9 22.4 24.2 72.8 Proposed ﬁ nal one-tier dividend (cents) 6.0 8.0 8.0 8.0 9.0 Distribution in specie/proposed special dividend (cents) (Note 3) 44.0 12.0 – – 9.0 Net tangible assets ($) 2.21 3.18 3.39 2.36 2.97

Financial ratios Return on shareholders’ equity (%) (Note 4) After taxation but before fair value gain/(loss) on investment properties/impairment 15.2 30.5 9.7 9.4 18.4 After taxation and fair value gain/(loss) on investment properties/impairment 12.8 46.2 9.9 10.1 30.0 Dividend cover (times) (Note 5) 5.5 8.9 3.9 2.3 4.9 Interest cover (times) (Note 6) 4.1 8.6 11.1 13.1 23.9 Net debt-equity ratio (times) (Note 7) 1.04 0.41 0.52 0.22 0.20

Employees (Note 8) Number (average) 2,550 2,793 2,782 2,650 2,835 Wages and salaries ($’000) 66,956 92,659 92,477 102,776 124,866 Pre-tax proﬁ t per employee ($’000) 108 189 87 78 205

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. The earnings per share for 2006 to 2008 have been restated to include the effects of the Company’s rights issue in 2009. 3. The distribution in specie for 2006 consists of 37 cents (less tax 20%) of taxed dividend and 7 cents of one-tier tax-exempt dividend. 4. In the calculation of return on shareholders’ equity, the weighted average basis has been used. 5. Dividend cover for 2007 and 2010 are 3.6 times and 2.5 times respectively if the special dividend is included. 6. In the calculation of interest cover, fair value gain/(loss) 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 sale. 7. In the calculation of the net debt-equity ratio, net debt includes borrowings net of cash and equity includes non-controlling interests in subsidiary companies. 8. Wages and salaries include amounts capitalised under properties held for sale. In the calculation of pre-tax proﬁ t per employee, the share of results of associated companies and fair value gain/(loss) on investment properties/impairment are excluded.

Five-Year Group Financial Proﬁ le 3 Group Quarterly Results

Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Year $’000 % $’000 % $’000 % $’000 % $’000 Sales 2010 158,826 20 202,805 26 149,179 19 281,463 35 792,273 2009 145,711 16 249,935 27 227,768 25 300,455 32 923,869

Operating proﬁ t 2010 46,381 21 52,630 24 51,570 23 72,346 32 222,927 2009 31,936 16 45,077 22 65,557 33 59,355 29 201,925

Pre-tax proﬁ t before fair value gain/(loss) on investment properties/impairment 2010 88,664 12 98,462 13 91,857 12 478,350 63 757,333 2009 55,669 15 83,461 23 107,700 29 123,711 33 370,541

Pre-tax proﬁ t after fair value gain/(loss) on investment properties/impairment 2010 88,664 8 98,462 8 91,857 8 904,160 76 1,183,143 2009 55,669 16 83,461 23 107,700 30 111,734 31 358,564

Net proﬁ t 2010 64,657 6 70,058 7 70,103 7 841,013 80 1,045,831 2009 36,885 13 58,174 21 78,506 28 106,851 38 280,416

The Group achieved the highest sales in the fourth quarter of 2010 compared with the other three quarters, due primarily to improved residential sales in China, Vietnam and Indonesia. The performance for the fourth quarter of 2010 was further boosted by a corporate restructuring surplus of $363.8 million arising from the disposal of the Group’s one-third interest in Marina Bay Financial Centre (“MBFC”) Phase 1 to K-REIT Asia as part of an asset swap arrangement between the Group and K-REIT Asia. Under this arrangement, the Group disposed of MBFC Phase 1 at a consideration of $1,399 million and at the same time, acquired Keppel Towers and GE Tower from K-REIT Asia at a consideration of $573 million.

In addition, the Group recorded a net fair value gain on investment properties (net of deferred tax and non-controlling interests) of $415.6 million, partly offset by impairment (net of non-controlling interests) of $10.6 million provided for two hotels in Indonesia.

Against 2009, the Group achieved higher sales in the fi rst quarter but lower sales in the remaining three quarters. The sales in the fi rst quarter of 2009 were lower mainly because of the diffi cult market conditions amid the global recession in early part of 2009. However, sales picked up when the property markets in Singapore and other key Asian countries where the Group operates in experienced rebound from the second quarter of 2009 onwards. The Group’s lower sales for the last three quarters of 2010 were due primarily to the lower residential sales in Singapore as several projects were completed and fully sold by end-2009.

Keppel Land Limited 4 Report to Shareholders 2010 Corporate Profile

Keppel Land Limited is the property Chinese companies that are members arm of the Keppel Group, one of of the FTSE ST All-Share Index. Singapore’s largest multi-national groups with key businesses in It has also been included in offshore and marine, infrastructure, The Sustainability Yearbook 2011, which and property. features the top 15% of companies worldwide in sustainability leadership. With beginnings dating back to 1890, Keppel Land is one of Asia’s A leading prime offi ce landlord in premier property companies, Singapore, Keppel Land contributes recognised for its sterling portfolio to enhancing the city’s skyline with of award-winning residential landmark developments such as developments and investment-grade Ocean Financial Centre and Marina Bay commercial properties as well Financial Centre. as high standards of corporate governance and transparency. Keppel Land is also Asia’s premier home developer with world-class iconic The Company is geographically waterfront homes at Keppel Bay and diversifi ed in Asia, with current focus Marina Bay. on Singapore, China, Vietnam, Indonesia and India. It has a strategic With a pipeline of over 75,000 homes focus on two core businesses of across Asia and the Middle East, property development and property Keppel Land is poised to tap on the fund management. demand for quality housing driven by home ownership aspirations. Keppel Land is one of the largest listed property companies by An established property fund manager, total gross assets on the Singapore Keppel Land has two property fund Exchange. Its total gross assets management vehicles, K-REIT Asia, amounted to $8.3 billion as at a pan-Asian commercial real estate 31 December 2010. It is also part investment trust, and Alpha Investment of the FTSE ST Real Estate Index Partners (Alpha). and EPRA/NAREIT Index. As at 31 December 2010, K-REIT Asia Keppel Land is one of two and Alpha’s total assets under Singapore companies to be management is $11.2 billion, when selected as an index component fully leveraged and invested. in the Dow Jones Sustainability Asia Pacifi c Index in 2010. Moving into the future, Keppel Land remains focused on becoming the Keppel Land has been admitted into premier developer of choice in Singapore the FTSE ST China Top Index which and the region and delivering sustainable is a broad China-play index including earnings to shareholders.

Corporate Proﬁ le 5 Chairman’s Statement

Record net proﬁ t “With the guidance of the Board $1 billion as well as the dedication and efforts Increased 273% of the management team and from $280.4 million valuable employees, Keppel Land in FY 2009. was able to seize opportunities amidst the strong recovery and achieved excellent results.”

DEAR SHAREHOLDERS, dividend of 18 cents per share to On behalf of the Board, I present the shareholders, comprising an ordinary Keppel Land Group report for the year dividend of 9 cents per share and a ended 31 December 2010. special dividend of 9 cents per share.

RECORD EARNINGS The dividend payout, which amounts Keppel Land delivered a sterling set to about $261 million or 40.9% of of results, with a record net profi t net profi t excluding net fair value gain exceeding $1 billion in 2010, up 273% on investment properties and the gain from $280.4 million in 2009. Earnings on acquisition of additional interest in were lifted by a $363.8 million net gain K-REIT Asia, is subject to shareholders’ from the sale of the Group’s one-third approval at the Annual General Meeting interest in Marina Bay Financial Centre to be held on 21 April 2011. Once (MBFC) Phase 1 and a net fair value approved, it will be paid out around gain of $405.1 million on investment 20 June 2011. properties. As in previous years, Keppel Land Excluding the net fair value gain on is offering shareholders the option of investment properties, the Group’s receiving their dividend in cash or in the net profi t grew 145.2% to $640.8 million form of shares of the Company under in 2010, with better home sales in the Dividend Reinvestment Scheme. Singapore and China and higher fund management earnings from K-REIT Asia ROBUST PERFORMANCE and Alpha Investment Partners. Singapore As buying sentiments improved with Economic value added has also strong economic growth, Keppel Land grown signifi cantly to $385 million achieved higher home sales of more from $81.7 million in 2009. than 650 units in Singapore in 2010.

PROPOSED DIVIDEND The Group won the bid for a keenly- In view of the good results, the Board contested 1.6-ha site in Jurong Lake is recommending a ﬁ nal one-tier District in May and launched

Keppel Land Limited 6 Report to Shareholders 2010 Chairman’s Statement 7 Chairman’s Statement

The Lakefront Residences just six months later. Take-up was robust. Over 80% of the 560 units launched were snapped up in November and December. Sales were also encouraging at the Reﬂ ections at Keppel Bay and Marina Bay Suites.

On the commercial front, the offi ce market staged a strong recovery in 2010. Fuelled by strong demand from the expansion of the fi nancial and services sectors, Grade A offi ce space take-up rose to 1.47 million sf, a signifi cant increase from a negative take-up of about 130,000 sf in 2009.

The Group’s total Grade A ofﬁ ce take-up at MBFC and Ocean Financial Centre (OFC) for the year rose strongly to over 1 million sf, accounting for more than two-third of Singapore’s total Grade A ofﬁ ce take-up for 2010.

Pre-commitments for OFC and MBFC Phase 2 stand at about 80% and 66% respectively ahead of their respective completions in 2011 and 2012, driven by pent-up demand for prime ofﬁ ces with increasing ﬂ ight-to-quality among corporate occupiers. The Group is in negotiation with several potential tenants, and expects take-up at MBFC Phase 2 and OFC to increase further.

In line with the Group’s strategy to unlock value and recycle capital, Keppel Land completed an asset swap with K-REIT Asia where Keppel Land divested its one-third interest in MBFC Phase 1 to K-REIT Asia and in turn, acquired Keppel Towers and GE Tower (KTGE). The transaction strengthened Keppel Land’s ﬁ nancial position with $826 million net cash proceeds.

The Group’s total Grade A ofﬁ ce take-up at MBFC and Ocean Financial Centre (in photograph) for the year rose strongly to over 1 million sf.

Keppel Land Limited 8 Report to Shareholders 2010 The Group has obtained the provisional Launched in June, The Springdale in permission to redevelop the KTGE site Shanghai has also been well-received. into 620 luxury homes. In addition to the convenience of being close to the With China growing in importance, Tanjong Pagar MRT station, residents Keppel Land China was set up to will enjoy city living in a precinct which sharpen focus and enable the Group is being transformed into a waterfront to be more nimble in capturing city after the relocation of ports and opportunities in the fast-growing market. the Malaysian railway station. Keppel Land China acquired two prime Overseas residential sites in Chengdu and made Keppel Land achieved record sales its maiden acquisition in Nantong, of over 4,600 homes overseas in 2010, Jiangsu Province. The Group has also mostly from the Group’s projects completed the acquisition of an in China. additional 66-ha site in Zhongshan, Guangdong Province, where the entire Despite the spate of measures to cool 86-ha site will be the Group’s ﬁ rst the property market imposed by the waterfront residential cum marina government from April 2010 onwards, development in China. Keppel Land achieved good sales in China mainly from the two townships, In Vietnam, sales continued to progress The Botanica in Chengdu and Central at residential developments, The Estella Park City in Wuxi. and Riviera Cove. To capture the rising demand for waterfront homes, the Group The Group also launched its ﬁ rst secured four sites in Ho Chi Minh City eco-homes in Tianjin Eco-City with (HCMC), translating into around 7,000 about 85% of the 548 units launched villas and apartments, which will be at Seasons Park sold in the last quarter progressively launched from this year. of 2010. These acquisitions enhance The Group’s luxury villa projects, Keppel Land’s reputation as a premier The Arcadia in Tianjin and Villa Riviera in developer in the country with about Shanghai, were sold out during the year. 22,000 homes in the pipeline.

Keppel Land achieved good sales in China mainly from the two townships, The Botanica in Chengdu (in photograph) and Central Park City in Wuxi.

Chairman’s Statement 9 Chairman’s Statement

Backed by continued recovery, the economic growth to moderate to a Group also saw signifi cant improvement more sustainable pace of 4–6% in 2011. in take-up for its projects in India and As the offi ce market is closely related Indonesia on stronger buying power and to the expansion of the economy, the a growing middle-class. The Group is positive GDP growth projected for the redeveloping one of the two towers at year will continue to underpin leasing International Financial Centre (formerly interest. Singapore’s leading position Barclays House) in Jakarta, Indonesia. as a fi nancial and high-tech hub has The 10-storey tower will be redeveloped also drawn leasing activity as hiring and into a 40-storey high-rise building with a corporate expansion gain momentum. potential gross fl oor area of about 600,000 sf to meet the demand for Buoyed by the growth in business quality offi ce premises in Jakarta’s confi dence in a vibrant offi ce market, central business district (CBD). the Group is well-positioned to capture further upside of the offi ce sector given Fund Management its quality portfolio of Grade A offi ces The Group’s fund management vehicles in the Marina Bay and Raffl es Place continued to extend their reach through precincts. selective acquisitions, growing total assets under management (AUM) by The Government has implemented 14% to about $11.2 billion. further cooling measures to ensure that the residential market stays on a K-REIT Asia took the fi rst step to sustainable growth path after record becoming a Pan-Asian REIT with home sales of almost 16,300 units the acquisition of two prime offi ce in 2010. developments in Australia, namely a 50% stake in 275 George Street in Transaction volume may moderate in Brisbane and 77 King Street in Sydney. the short term as prospective buyers These acquisitions, along with the hold back on their purchases. However, addition of a one-third interest in MBFC sound growth prospects for Singapore Phase 1, enlarged K-REIT Asia’s portfolio and Asia as well as liquidity from Asia’s asset size from $2.1 billion to $3.5 billion booming wealth will shore up demand as at end-2010, making it among the top for well-located homes. fi ve S-REITs in asset size. In the year ahead, the Group will The Group’s private equity vehicle, launch a new phase of The Lakefront Alpha Investment Partners (Alpha), was Residences, riding on the apartments’ also busy. One of its funds, Alpha Asia proximity to the MRT station and Macro Trends Fund (AAMTF), acquired development of the Jurong Lakeside Seoul Square, a prime Grade A offi ce District into the biggest commercial hub, building located in the heart of the outside the CBD. The Group will also capital of South Korea. In Singapore, launch the remaining units at Refl ections AAMTF also acquired residential units in at Keppel Bay and Marina Bay Suites to several developments in prime districts: capitalise on their proximity to the two City Vista in the Newton area, Draycott 8 integrated resorts and lifestyle near Orchard Road and The Cascadia aspirations for waterfront living. in Bukit Timah, as well as a 77% stake in Katong Mall, which is being redeveloped Overseas, Keppel Land has several into a new retail destination. launches planned across China including township homes at POSITIONED TO CAPTURE The Seasons in Shenyang, new phases FURTHER GROWTH of 8 Park Avenue in Shanghai and The government expects Singapore’s The Botanica in Chengdu. The Group

Keppel Land Limited 10 Report to Shareholders 2010 Sustaining Value

Advancing Strategy g Our strategy to unlock value and recycle capital through our diverse portfolio, underpinned by prudent financial management, strengthens Keppel Land’s position to capture opportunities abounding in fast-growing Asia and beyond.

Sharpening Focus g We enhance nimbleness and responsiveness with keener focus in key markets to further expand presence and portfolio to grow creditable earnings for shareholders. Distinguishing Quality

Building on Strengths g Leveraging our strong network, proven expertise and track record, we contribute to the creation of vibrant communities with innovative lifestyle properties which improve the quality of life.

Honing Competitive Edge g Our sterling portfolio of properties is distinguished by the Keppel quality hallmark which translates into skilful masterplanning, attention to details and needs as well as excellent execution. Enriching Lives

Realising Aspirations g Our people realise their own development and growth potential as they drive towards the goal of fulfilling the needs of aspiring homeowners across the region for quality housing.

Engaging Communities g We are committed to positively impact the communities wherever we operate in, with active interaction and engagement of our different stakeholders through a diverse range of life-enriching activities and programmes. will also roll out the remaining blocks with good sustainable practices. at Seasons Park in Tianjin Eco-City, Keppel Land was one of three companies the balance units in The Springdale in in Singapore whose 2009 Sustainability Shanghai as well as Central Park City Report was internationally veriﬁ ed Global in Wuxi. Despite the Chinese Reporting Initiative (GRI) B+. government’s measures to curb speculation in the property market, The Company was conferred the homeowner aspirations for quality prestigious Most Admired ASEAN and well-located developments are Enterprise Award for CSR at the expected to continue, supported by ASEAN Business Awards 2010. It was rapid urbanisation and rising incomes. also presented with the Merit Award for the Singapore Environmental Achievement In Vietnam, the Group will launch Award, organised by the Singapore Riviera Point, a prime condominium Environment Council. project located in District 7, and a waterfront township development at Going beyond caring for and protecting South Rach Chiec in HCMC, riding on the environment, Keppel Land will continue rising demand for waterfront homes. to contribute to the communities where it operates, across the region. Moving ahead, Keppel Land will continue to actively seek acquisition opportunities ACKNOWLEDGEMENTS in Singapore and the region. With a war With the guidance of the Board as chest of about $1.6 billion in cash and well as the dedication and efforts of a low net debt-equity ratio of 0.2x as at the management team and valuable end-2010, Keppel Land is well-poised to employees, Keppel Land was able to take on more large-scale developments seize opportunities amidst the strong such as townships and mixed-use projects. recovery and achieved excellent results.

The Group’s fund management I would like to take this opportunity to vehicles will also actively pursue buying welcome Mrs Oon Kum Loon to the Board. opportunities and grow AUM. With just Her wealth of experience in the ﬁ nancial 65% of the $1.7 billion fund currently sector as well as in risk management invested, Alpha’s AAMTF is in a strong will contribute signiﬁ cantly to further position to seek further asset acquisitions. strengthen and grow Keppel Land. K-REIT Asia will selectively seek commercial properties that will Finally, my appreciation goes out to complement its portfolio and strengthen customers, business associates, and its position as a leading Pan-Asian other stakeholders for their continuous commercial REIT. support. We are now in a position of strength, which puts us in a good stead RECOGNITION FOR CSR EFFORTS to capture more growth opportunities and 2010 marks another milestone for meet the challenges in the year ahead. Keppel Land’s Corporate Social Responsibility (CSR) efforts. Yours sincerely,

The Company has been selected as an index component of the Dow Jones Sustainability Asia Paciﬁ c Index. One of only two Singapore companies to be included in the Index, the inclusion will raise Keppel Land’s visibility Choo Chiau Beng amongst socially responsible funds Chairman which place a premium on companies 22 February 2011

Chairman’s Statement 11 Board of Directors*

Choo Chiau Beng, 63

Chairman Member, Nominating Committee Member, Remuneration Committee Member, Board Safety Committee

Kevin Wong Kingcheung, 55

Group Chief Executive Officer Member, Board Safety Committee

Khor Poh Hwa, 61

Member, Nominating Committee Member, Remuneration Committee Member, Board Safety Committee

Keppel Land Limited 18 Report to Shareholders 2010 Lim Ho Kee, 66

Chairman, Nominating Committee Member, Remuneration Committee

Tsui Kai Chong, 55

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

Lee Ai Ming, 56

Member, Audit Committee Member, Board Risk Committee Member, Board Safety Committee

* As at 16 March 2011

Board of Directors 19 Board of Directors*

Tan Yam Pin, 70

Chairman, Remuneration Committee Chairman, Board Safety Committee

Heng Chiang Meng, 65

Chairman, Board Risk Committee Member, Audit Committee

Edward Lee Kwong Foo, 64

Member, Board Safety Committee

Keppel Land Limited 20 Report to Shareholders 2010 Koh-Lim Wen Gin, 66

Member, Board Safety Committee

Teo Soon Hoe, 61

Member, Audit Committee

Oon Kum Loon, 60

Member, Audit Committee Member, Board Risk Committee

* As at 16 March 2011

Board of Directors 21 Senior Management

1_Tan Swee Yiow 3_Kevin Wong Kingcheung 5_Ang Wee Gee

President, Singapore Commercial Group Chief Executive Officer Executive Director, and Head, Regional Investments Keppel Land International Limited (Indonesia, Malaysia and Myanmar) and Executive Vice Chairman, Keppel Land China Limited

2_Ng Hsueh Ling 4_Loh Chin Hua 6_Augustine Tan Wee Kiong

Chief Executive Officer, Managing Director, President, Singapore Residential K-REIT Asia Management Limited Alpha Investment Partners Limited and Head, Regional Investments (India and Middle East)

6 2 5

Keppel Land Limited 22 Report to Shareholders 2010 1_Albert Foo Cheur Wee 3_Lim Kei Hin 5_Christopher Ho Kam Pouy

General Manager, Marketing Chief Financial Officer General Manager, Property Management

2_Chan Kam Fai 4_Choo Chin Teck 6_John Henry Birchall

General Manager, Director, Corporate Services Director, Safety and Health Human Resources and Company Secretary

2 5 4

1 3

Senior Management 23 Key Personnel

KEPPEL LAND LIMITED PROPERTY INVESTMENT, DEVELOPMENT AND MANAGEMENT

Choo Chiau Beng Keppel Land International Limited Singapore Residential Chairman Ang Wee Gee Augustine Tan Wee Kiong Executive Director, President, Singapore Residential Kevin Wong Kingcheung Keppel Land International Limited and Head, Regional Investments Group Chief Executive Ofﬁ cer and Executive Vice Chairman, (India and Middle East) Keppel Land China Limited Vernon Low Ong Chye Choo Chin Teck Deputy General Manager Director, Corporate Services (Business Development) and Company Secretary Goh Han Kee Finance and Administration Deputy General Manager Lim Kei Hin (Projects) Chief Financial Ofﬁ cer Go Kee Tiang Melissa Teh Assistant General Manager General Manager, (Projects) Finance and Administration Lim Kian Lee Tan Boon Ping Assistant General Manager Financial Controller, (Projects) Group Finance and Accounts Sim Kim Hui Katherine Tay Beng Ngoh Assistant General Manager Assistant General Manager (Projects) (Corporate Finance), Group Finance and Accounts Marketing Albert Foo Cheur Wee Singapore Commercial General Manager, Marketing Tan Swee Yiow President, Singapore Commercial Lee Eng Beng and Head, Regional Investments Deputy General Manager, (Indonesia, Malaysia and Myanmar) Marketing (Overseas Residential)

Jeff Tan Yek Sang Sally Tan Meow Ling General Manager Deputy General Manager, (Investment and Asset Management) Marketing (Commercial)

Paul Lau Kah Kee Cara Kwok Sook Han Deputy General Manager Assistant General Manager, (Projects) Marketing (Singapore Residential)

Mok Soo Jacquelyn Wong Rhu Chian Project Director, Assistant General Manager, Marina Bay Financial Centre Marketing (Overseas Residential)

Cheng Heng Wei Thomas Tan Chiang Hwee Deputy Project Director, Head (Marketing – Residential), Marina Bay Financial Centre Marina Bay Financial Centre

Shirley Tsou Lei Rose Tong Peck Ting Deputy Project Director, Head (Marketing – Retail), Marina Bay Financial Centre Marina Bay Financial Centre

Georgina Goh Boon Ling Head (Marketing – Commercial), Marina Bay Financial Centre

Keppel Land Limited 24 Report to Shareholders 2010 Property Management Information Technology Christopher Ho Kam Pouy Kevin Chua Kee Wee General Manager, Assistant General Manager, Property Management Information Technology

Steven Neo Say Hian Human Resources Deputy General Manager, Chan Kam Fai Property Management General Manager, Human Resources Peck Peng Soon Assistant General Manager, Poon Kwee Ping Property Management Deputy General Manager, Human Resources Daniel Chua Hiang Choon Assistant General Manager, Internal Audit Property Management Tee Swee Teng Assistant General Manager, Workplace Safety and Health Group Internal Audit John Henry Birchall Director, Safety and Health Keppel Bay Pte Ltd (From 7 February 2011) Augustine Tan Wee Kiong Director Asset Performance Management Joseph Low Kar Yew Tan Tai Chiew Assistant General Manager, General Manager Asset Performance Management Marina at Keppel Bay Investor Relations and Research Augustine Tan Wee Kiong Serena Toh Lai Siong President, Singapore Residential Deputy General Manager, and Head, Regional Investments Investor Relations and Research (India and Middle East)

Teo Soo Kiam Trevor Fong Kit Assistant General Manager, General Manager, Investor Relations and Research Marina at Keppel Bay

Woon Pek Yong Assistant General Manager, Investor Relations and Research

Corporate Development Kwok Yan Hoe Deputy General Manager, Corporate Development

Key Personnel 25 Key Personnel

PROPERTY FUND MANAGEMENT KEPPEL LAND CHINA LIMITED

K-REIT Asia Management Limited Ang Wee Gee Andrew Seet Kwang Meng Ng Hsueh Ling Executive Vice Chairman General Manager, Chief Executive Offi cer Guangdong Ho Cheok Kong Eve Chan Bee Leng President Peter Lee Wai Mun Chief Financial Offi cer Deputy General Manager, Patrick Lim Jean Loong Chengdu Alpha Investment Partners Limited Chief Financial Offi cer Loh Chin Hua Peter Lim Meng Peng Managing Director Liew Chin Sin Deputy General Manager, General Manager, Investment Shenyang Christina Tan Hua Mui Executive Director/ Lee Eng Beng Daniel Chong Siew Hoe Chief Financial Offi cer Acting General Manager, Assistant General Manager, Marketing Wuxi Desmond Tang Kok Peng Executive Director, Desmond Wong Hong Kiong Ben Lee Siew Keong Investment and Asset Management General Manager, Assistant General Manager, Property Management Shanghai Young Lok Kuan Executive Director, Vincent See Wing Chuen Desmond Tay Koon Chye Research and Portfolio Management General Manager, Assistant General Manager, Human Resources Tianjin Goh York Lin Executive Director, Asset Management Ng Ooi Hooi Peter Yu Jin Hong General Manager, Special Projects Assistant General Manager, Alvin Mah Chee Hong (Seconded to Sino-Singapore Kunming Executive Director, Investment Tianjin Eco-City) Wee Peng Siong Ang Sock Cheng William Tan Tin Kwang Assistant General Manager, Director, Finance General Manager, Tianjin and Jiangyin Golf Operations Northern China April Chang Shu Ping Assistant General Manager, Asset Management HOTELS, SERVICED APARTMENTS AND RESORT MANAGEMENT

Sedona Hotels International Pte Ltd Vincent Tan Aik Cheong Senior Vice President

Keppel Land Limited 26 Report to Shareholders 2010 INDONESIA, MALAYSIA INDIA AND MIDDLE EAST VIETNAM, THAILAND AND MYANMAR AND PHILIPPINES

Tan Swee Yiow Augustine Tan Wee Kiong Linson Lim Soon Kooi President, Singapore Commercial President, Singapore Residential President and Head, Regional Investments and Head, Regional Investments (Vietnam, Thailand and Philippines) (Indonesia, Malaysia and Myanmar) (India and Middle East) Doan Anh Hung Sam Moon Thong Peter Chew Cheng Ming Deputy General Manager President President (Vietnam) (Indonesia, Malaysia and Myanmar) (India and Middle East) Raymond Chin Yun Choi Stephen Choo Kooi Yoon Stephen Choo Kooi Yoon Assistant General Manager Senior General Manager Senior General Manager (Ho Chi Minh City Operations) (Projects) (Projects) Peter Kuan Teck Sing Lim Seng Bin Yeo Chee Kian Assistant General Manager General Manager Deputy General Manager (Vietnam Townships) (Indonesia) (Bangalore) Jane Low Hong Ming Wee Boon Leong Marah Moehammad Assistant General Manager Assistant General Manager Hoessein Bin Salim (Vietnam Townships) (Investment) Assistant General Manager (Kolkata) Wong Yew Siong Steven Shum Wing On Senior Manager Deputy General Manager Mohammad Zahid Bin Yacob (Hanoi) (Malaysia Operations) Assistant General Manager (Jeddah) Roy Cheng Li-Wang Vincent Tan Aik Cheong General Manager, Assistant General Manager Keppel Thai Properties Public (Myanmar) Company Limited Senior Vice President, Sedona Hotels International Pte Ltd Lee Foo Tuck Senior Vice President, Keppel Philippines Properties, Inc.

Key Personnel 27 Investor Relations

1_Keppel Land shareholders vote RENEWED INTEREST SUCCESSFUL ASSET SWAP in favour of the proposed asset swap of MBFC Phase 1 and With the strong economic rebound in Approval from the minority shareholders Keppel Towers and GE Tower. 2010, Keppel Land engaged in more and unitholders for the asset swap deal

2_Senior management engaged corporate actions and developments was obtained at Keppel Land’s and openly with the media and analysts during the year. Investor relations K-REIT Asia’s Extraordinary General during briefi ngs for the Company’s half-year and full-year results. activities intensifi ed with the renewed Meetings on 8 December 2010 and the interest from investors and shareholders. deal was completed by end-2010. The strategic asset swap between Keppel Land and K-REIT Asia Concurrently, Keppel Land announced captured much attention from the the issue of $500 million unsecured investment community. convertible bonds in November 2010. There were queries as to whether the After its announcement in October bond issue was necessary since the 2010, there were some concerns that Company would have substantial cash the deal tipped in favour of Keppel proceeds after the asset swap. Land. Senior management went on The IR team took pains to explain roadshows in the US, Hong Kong that the move would enhance the and Europe, and organised meetings Company’s fi nancial fl exibility to and conference calls with major acquire sites for large-scale shareholders and fund managers in developments which would require Singapore to explain the rationale and substantial investment. The new mutual benefi ts of the bundled deal bond issue would also help to pay to seek their support. off bond holders if a put option for an earlier convertible bond The Investor Relations (IR) team also issued in 2006 was exercised. took efforts to address issues raised by investors and shareholders via emails In addition, Keppel Land’s successful and phone calls, which include the bid for a 1.6-ha site at Lakeside Drive valuation and pricing of the properties, in May 2010 also raised concerns the timing of the divestment, and as the purchase price was some proposed use of the cash proceeds 15% higher than the second highest from the divestment. bid. The IR team worked at allaying

Keppel Land Limited 28 Report to Shareholders 2010 such concerns by communicating With increasing investors’ interest The Annual General Meeting (AGM) is the strong marketing attributes of in the growing China market, the a major platform for shareholders to the site arising from the transformation IR team facilitated more site visits engage with the Company’s Board of of the Jurong Lakeside District and to China. Some 15 site visits Directors and senior management. its proximity to MRT stations. When were arranged for analysts and The Lakeside Residences was fund managers to meet with local HIGHER RETURNS launched just six months later in management teams in the cities The Company continued to work November, it was well-received by where Keppel Land operated in. towards maximising returns for buyers and gained positive media Projects which drew strong interest shareholders. Keppel Land’s total and analysts’ coverage. included the Tianjin Eco-City, shareholder returns (TSR) rose to The Springdale and 8 Park Avenue 38.1% in 2010, four times the ADDRESSING CONCERNS in Shanghai, The Botanica in average TSR of its peers. At the outset, there were fears among Chengdu, Central Park City in Wuxi analysts and investors over new offi ce and residential sites in Shenyang Keppel Land’s share price appreciated supply over the next fi ve years, which and Chengdu. by 37.7% in 2010, outperforming the could put pressure on the offi ce FTSE ST Index and FTSE ST Real market. The management made Refl ecting the keen interest in new Estate Index, which rose 11.4% and efforts to explain that the supply was Grade A offi ce space, the IR team 8.7% respectively during the year. not excessive as there was strong pre- also organised and co-ordinated visits Keppel Land’s market capitalisation commitment from pent-up to its new iconic development, Marina also surged to about $7 billion as demand which will be intensifi ed Bay Financial Centre (MBFC) Phase 1. at end-2010, up from $5 billion by existing supply being removed On one occasion, a visit to the MBFC a year ago. from the market due to redevelopment Phase 1 was made the fi rst stop into other use. The IR team put in the itinerary of an international Keppel Land is a key component together a special feature in real estate fund manager’s fi rst in various stock indices such as Keppel Land’s 2009 annual report overseas board meeting. FTSE ST Real Estate Index and addressing the concerns of the EPRA/NAREIT Index, and most offi ce supply. REGULAR COMMUNICATION recently, the FTSE ST China Top Index. The Company continues to ensure In 2010, the rolling out of property the timely and fair disclosure of DIVERSE SHAREHOLDER BASE measures to cool the residential information to all stakeholders With Keppel Land’s increased markets in Singapore and China through the dissemination of visibility in the global equities arena, affected investors’ sentiments corporate announcements, press the Company’s pool of institutional towards developers. Management releases and presentation slides on investors grew to about 30% of its and the IR team reassured investors the Singapore Exchange’s SGXNet and shareholder base as at end-2010 of the strategic strength of the Keppel Land’s website simultaneously. from about 24% a year ago. Company’s projects, especially its townships. Keppel Land’s corporate website is These institutional shareholders reviewed regularly to make it more are geographically well-diversifi ed The Company is committed to investor-friendly. A new site search across over 80 cities in North America, spending more efforts and resources engine was added to help users Europe, Australia, Middle East to serve the interests of the growing to fi nd information easily. The and Asia. Renewed interest came investment community. Meetings with investing public is also channeling from overseas investors, particularly fund managers as well as buy-side more queries via the Company’s from the US. and sell-side analysts, post-results website which the IR team luncheon meetings and conference responds promptly. The Company also enjoys wide calls have increased signifi cantly. analysts’ coverage from more than The management took part in To facilitate a better understanding 20 stockbroking houses. To build investor roadshows in Singapore, of the Company’s operations, up relationships, especially with Malaysia, Hong Kong, United Kingdom, strategies and fi nancial performance, new analysts, efforts are made Europe and the United States, joint media and analysts’ briefi ngs to explain the company’s core and participated in 13 conferences were organised for Keppel Land’s businesses, strategy, operations in 2010. interim and full-year results. and corporate developments.

Investor Relations 29 Investor Relations

HIGH STANDARDS in April 2010 by The Business Times Keppel Land was a ﬁ nalist at the ACCA Singapore Awards for The Company is committed to and the Corporate Governance and Sustainability Reporting 2010. upholding its high standards in Financial Reporting Centre of the corporate social responsibility (CSR) National University of Singapore. as investors and shareholders place increasing emphasis on sustainability. LOOKING AHEAD In recognition of the Company’s 2011 is set to be another active year CSR efforts, Keppel Land has been for the IR team in Keppel Land. The included in the Dow Jones Asia Paciﬁ c Company will continue to work at Sustainability Index, putting it strengthening relationships with the on the investment sphere of investing community and maximising socially-responsible funds. shareholders’ value.

To extend its efforts further, Keppel Land’s Sustainability Report 2009 was certiﬁ ed Global Reporting Market Capitalisation of Keppel Land Initiative (GRI) B+. as at end of year ($ million)

Keppel Land’s commitment to corporate transparency has won 4,963 5,243 1,226 5,004 6,961 accolades and the conﬁ dence of 8,000 the investment community. In 2010, Keppel Land was named Runner-Up 6,000 for “The Most Transparent Company” under the Properties category at the Investors’ Choice Awards presented 4,000 by the Securities Investors Association (Singapore). Keppel Land was also 2,000 ranked in the top 2% among 681 listed companies for its high level of 0 disclosure in the Governance and Transparency Index published 2006 2007 2008 2009 2010

Keppel Land Limited 30 Report to Shareholders 2010 INVESTOR RELATIONS CALENDAR

Q1 2010 Q2 2010

g Announcement of FY2009 results g Announcement of 1Q 2010 results. with joint press and analysts’ briefing. g Annual General Meeting and Extraordinary g Participation in Deutsche Bank Access General Meeting. Malaysia & Singapore Corporate Day. g Participation in DMG Singapore Property g Participation in BNP Paribas Corporate Day in Kuala Lumpur. Asean Conference Forum. g Participation in Deutsche Bank g Participation in Goldman Access Asia, Citigroup Asia Sachs Asia Property Pacific Property and Bank of Corporate Day in America Merrill Lynch Asian Hong Kong. Stars Conferences.

g Participation in Nomura Asia Equity Forum.

g Hosting of site visits in Singapore, China and Vietnam.

Q3 2010 Q4 2010

g Announcement of 1H 2010 results with g Announcement of 3Q 2010 results. joint press and analysts’ briefing. g Announcement of the asset swap deal g Participation in BNP Paribas Asean with K-REIT Asia. in Hong Kong. g Investor roadshows to the US, g Participation in Credit Suisse Hong Kong and UK to garner Asean Corporate Day. support for asset swap.

g Participation in CLSA Asean g Extraordinary General Access Day. Meeting for the asset swap transaction. g Participation in UBS Asean & India g Hosting of site visits in Conference 2010. Singapore and China.

g Hosting of site visits g Participation in in Singapore Morgan Stanley and China. Asia-Pacific Summit.

Investor Relations 31 Corporate Milestones

January g K-REIT Asia acquired a Grade A office g Keppel Land secured two prime g Keppel Land acquired its third tower 77 King Street in Sydney, Australia. sites in Chengdu, Sichuan Province township site in the popular District 2 for residential development. of Ho Chi Minh City (HCMC), Vietnam. August g Mrs Oon Kum Loon was appointed g Keppel Land entered into two g Keppel Land signed a joint venture as a Non-Independent and Non- joint ventures with local partners to agreement to develop an 11-ha Executive Director of Keppel Land. develop two prime villa sites in HCMC. waterfront site for villa development The two sites will yield a total of in HCMC. September 375 villas. g Keppel Land seeks to unlock value g Mrs Koh-Lim Wen Gin was in the former Barclays House (now g More than 90% of the 220 units appointed to Keppel Land’s Board known as International Financial Centre) released were sold over a weekend of Directors. in Jakarta through the redevelopment at the soft launch of Seasons Park, of one of its two towers. the first collection of eco-homes g K-REIT Asia made its maiden foray within Keppel’s 36.6-ha site in the outside Singapore with the acquisition g K-REIT Asia appointed Mr Tan Chin Sino-Singapore Tianjin Eco-City. of a 50% stake in 275 George Street Hwee, the Portfolio Manager of the in Brisbane, Australia. Apollo Asia Opportunity Master Fund, as g Keppel Land issued $500 million an Independent Non-Executive Director. convertible bonds at 1.875% per annum. March g The iconic Reflections at Keppel Bay g Keppel Land acquired an additional g The Lakefront Residences was in Singapore topped out its first tower. 66 ha in Zhongshan, Guangdong launched and attracted strong Province for an amalgamated 86-ha site interest and take-up. April for its first waterfront residential cum g Marina Bay Financial Centre (MBFC) marina development in China. November topped out its second commercial tower g An additional 11.85% stake was in a ceremony graced by Guest-of- g Keppel Land China Limited acquired in Ocean Properties Limited. Honour, Mr Tharman Shanmugaratnam, was established to strengthen Singapore’s Minister for Finance. the focus on China. December g Keppel Land and K-REIT Asia May October successfully completed the asset swap g Keppel Land was awarded a g Alpha Asia Macro Trends Fund of Keppel Land’s one-third interest 1.6-ha site in the upcoming Jurong invested in Seoul Square, a Grade A in MBFC Phase 1 and K-REIT Asia’s Lake District. office in South Korea. KTGE. KTGE will be redeveloped into premium residences for city living. July g Keppel Land entered into a share g Keppel Land strengthened its purchase agreement with K-REIT Asia position as a leading developer of for the divestment of its one-third interest international-grade commercial offices in MBFC Phase 1 and the purchase of in Singapore with the topping out Keppel Towers and GE Tower (KTGE) of Ocean Financial Centre. from K-REIT Asia.

Keppel Land Limited 32 Report to Shareholders 2010 Awards and Accolades

CORPORATE TRANSPARENCY SIAS Most Transparent Company Keppel Land was Runner-Up for the Most Transparent Company in the Properties category at the 11th Securities Investors Association Singapore (SIAS) Investors’ Choice Awards 2010.

Ranked Top 2% out of 681 Companies in Governance and Transparency Index Keppel Land has been consistently ranked among the top 2% in the Governance and Transparency Index, which rates Singapore’s listed companies on the quality of their financial disclosures and corporate governance features.

CORPORATE SOCIAL RESPONSIBILITY Merit Award for Keppel Land was recognised Dow Jones Sustainability Sustainability Reporting as the Most Admired ASEAN Keppel Land received the Merit Enterprise for Corporate Social Asia Paciﬁ c Index Responsibility at the ASEAN Keppel Land is one of two Singapore Award at the Singapore Awards for Business Awards. companies included in the Dow Jones Sustainability Reporting 2009 from Sustainability Asia Pacific Index 2010. the Association for Chartered Certified Accountants. The Index follows a best-in-class approach and measures sustainability This is the second consecutive year leaders from each industry on a global that Keppel Land received the award, and regional level respectively. which recognises organisations that raise awareness of corporate Keppel Land is also the only Singapore transparency issues and increase property company to be included in the accountability towards stakeholders Sustainability Yearbook 2011, which through their reports. features the top 15% of companies worldwide in sustainability leadership. Recognition for Best Practices at Singapore Human Most Admired ASEAN Enterprise Resources Awards at ASEAN Business Awards Keppel Land was recognised for its For its sustained and exemplary efforts in human capital management contributions, Keppel Land was at the Singapore Human Resources recognised as the Most Admired (HR) Awards in July 2010, organised by ASEAN Enterprise for Corporate Social the Singapore HR Institute. The awards Responsibility at the ASEAN Business recognise individuals and organisations Awards 2010 held in Hanoi, Vietnam, in that have made significant contributions October 2010. towards people management and development practices.

Awards and Accolades 33 Awards and Accolades

Mr Saman Sarathchandra (centre), GM of Sedona Hotel Yangon, received the Myanmar’s Leading Hotel award at the World Travel Awards.

The awards conferred to Keppel Land Sedona Lauded for Green Practices are Corporate Social Responsibility Hotel Sedona Manado in Indonesia (Leading), Performance Management emerged Runner-Up in the ASEAN (Special Mention) and E-HR Best Practice Competition for Energy Management (Special Mention). Management in Building and Industry (Small and Medium category) at the Merit Award at Singapore ASEAN Energy Awards in July 2010. Environmental Achievement Awards The hotel was also lauded for Best in Keppel Land bagged the Merit Award Green and Environment Practices by (Services category) for excellence in the Government of North Sulawesi in corporate environmental leadership June 2010. at the Singapore Environmental Achievement Awards 2010. Ocean Financial Centre Commended for Eco-Excellence BCA Green Mark Awards Ocean Financial Centre (OFC) was Four of Keppel Land’s developments commended for its overall energy in Singapore – Keppel Bay Tower, savings and innovative green features. Keppel Towers and GE Tower, Equity Plaza and Prudential Tower For its commitment towards sustainability, – were conferred the Green Mark OFC was conferred the Solar Pioneer Gold Award by the Building and Award in November 2010. Construction Authority (BCA) of Singapore in 2010. Bugis Junction The award is co-organised by the Towers also received the Green Mark Singapore Business Federation, Gold in January 2011. This brings the Sustainable Energy Association of total number of Green Mark Awards Singapore, Economic Development attained by Keppel Land to 23. Board and the Energy Market Authority.

Keppel Land Limited 34 Report to Shareholders 2010 PRODUCT EXCELLENCE Associations and the Vietnam Economics The MIAA is the leading industry Triple Win at Euromoney Association, the Guide Awards honour association for the marina industry Real Estate Awards outstanding hospitality service providers across the Asia Pacific region. The Keppel Land was named Best in Vietnam. association launched the Gold Anchor Developer in Vietnam, Best Office International Rating Scheme in 2009 Developer in Singapore and Best Sedona Hotel Yangon was named which assigns ratings to marinas on a Developer (Second) in Singapore at the Myanmar’s Leading Hotel for the third scale of three to five gold anchors. Euromoney Real Estate Awards 2010. consecutive year at the World Travel Awards ceremony in October 2010. Lauded for Safety Organised by leading global financial Marina at Keppel Bay and Keppel Bay magazine Euromoney, the awards Sedona Hotel Mandalay was also a Tower, as part of the HarbourFront recognise achievements in the property nominee in the same category. Hailed Cluster, was amongst the winners at industry worldwide across investment, by The Wall Street Journal as the travel the Safety and Security Watch Group management, advisory services and industry’s equivalent of the Oscars, Awards 2010. financing categories. the World Travel Awards are voted by travel professionals from 167,000 travel The awards recognise the top 10 Jakarta Garden City Bags agencies, tour and transport companies nationwide clusters that pass the Prestigious FIABCI Award and tourism organisations across stringent examinations set by the Jakarta Garden City received global the globe. Police and Civil Defence Force on recognition for its premium features at safety and security matters. the FIABCI Prix d’Excellence Awards in Marina at Keppel Bay is Asia’s Best May 2010. The integrated eco-township Marina at Keppel Bay was named was Runner-Up in the Residential Best Asian Marina in May 2010 at (Low Rise) category. the 6th Asia Boating Awards held in Hong Kong. The Asia Boating Awards Sedona Sets Benchmark for is organised annually by Asia-Pacific Service Excellence Boating and China Boating magazines Sedona Suites Hanoi and Sedona Suites and celebrates the best in the yachting HCMC were lauded at the Guide Awards and maritime scene. 2009–2010 in the Excellent Performance category, affirming their positions as Marina at Keppel Bay also became Vietnam’s leading serviced residences. the first marina in Asia to be awarded the 5 Gold Anchors rating from the Sponsored by the Vietnam National Marina Industries Association of Jakarta Garden City has been Administration of Tourism, the Vietnam Australia (MIAA) for top excellence lauded for being a well-managed Union of Science and Technology in services and facilities. eco-township.

Awards and Accolades 35 Special Feature

Office Market Riding on Upbeat Momentum

The Singapore offi ce market staged potential is expected with Grade A a strong recovery in 2010 and is set rents still about 47.3% below the to be the best-performing sector of previous peak of $18.80 psf/mth the property market for 2011. achieved in the third quarter of 2008. As the offi ce upturn continues to run its course, property consultants are Jones Lang LaSalle (JLL) also predicting another year of double-digit expects strong growth in Asia’s rental growth, barring unforeseen offi ce market to continue in 2011, circumstances. with Singapore as one of the leading Asian cities. CB Richard Ellis (CBRE) predicts Grade A offi ce rents to rise to $11.50 With Singapore’s position in the psf per month (psf/mth) by end-2011, “Rents Rising” quadrant in JLL’s which will translate into a 16.2% rental clock for Grade A offi ce, increase from $9.90 psf/mth as there is room for rents to continue at end-2010. Further upside to trend upwards.

Keppel Land Limited 36 Report to Shareholders 2010 Singapore’s SUSTAINABLE DEMAND to consolidate multiple offi ces in one strategic location Island-wide offi ce take-up surged to location is on the rise. Leasing enquiries as a financial and 1.65 million sf in 2010, a stark contrast have also increased as companies business hub to the negative take-up of 0.24 million sf who had previously postponed in 2009. This further validates the trend their decisions for expansion are is attracting of growing occupier demand in times revisiting them. global companies of better economic conditions. looking to tap into Occupier demand is fairly broad-based pan-Asian growth Relatively attractive rentals are and going beyond the predominance opportunities. motivating corporations to engage in of the fi nancial and banking sector to ‘fl ight to quality’ by committing to include wealth management, legal and higher grade offi ce space. With professional services. For instance, rentals on the rebound, the number law fi rm Drew & Napier has of corporate occupiers seeking pre-committed to offi ce space at contiguous offi ce space or looking Ocean Financial Centre (OFC), while

Grade A Office Rental Clock (as at 4Q 2010)

ing Re w nt lo s Guangzhou S F a th l li w n o g r

Hong Kong Kuala Lumpur Beijing Osaka, Ho Chi Minh City R g e in Seoul Singapore, Melbourne n t w s lo R S Bangkok i Shanghai, Adelaide si ne ng cli Sydney, Manila De Canberra Auckland Mumbai, Bangalore Brisbane Tokyo, Jakarta, Perth, Delhi Hyderabad, Taipei

Source: JLL

Special Feature Ofﬁ ce Market Riding on Upbeat Momentum 37 Special Feature

Swiss private bank Julius Baer and attracting global companies Existing supply is further reduced insurance giant Lloyd’s have pre-leased looking to tap into pan-Asian growth as an estimated 2.4 million sf of offi ce space over at Asia Square Tower 1. opportunities. More companies space will be removed with more are setting up or expanding their planned conversion of offi ce buildings Following the robust leasing activities presence in Singapore as it is within the central business district in 2010, there are concerns as to a choice destination for (CBD) into residential and whether demand can persist for 2011 multi-national corporations. other developments. and beyond. This would be dependent on the economic growth of Singapore For instance, Standard Chartered plans Concerns over the large volume and major Asian countries, as well to hire 2,000 more employees over the of secondary stock created by the as the expansion plans of companies next two years and double its trading relocation of major occupiers to in the region. room with their move into Marina Bay Marina Bay have largely dissipated as Financial Centre (MBFC). Aside from the vacated space has been taken Notwithstanding the uneven growth the fi nancial services industry, other up by other companies. A case in in the European Union and the US, notable companies such as Facebook point, Robert Walters, a recruitment Asia’s outlook is expected to remain and oil & gas operator Gazprom consultancy fi rm, will take up 70,000 robust, with a GDP forecast of more are setting up offi ces here. sf at Six Battery Road while fi nancial than 6% per annum from 2011 services fi rm, Manulife, leases some to 2015. With its proven ability to SUPPLY CONCERNS OVERRATED 100,000 sf at Plaza by the Park, rebound from the global economic Earlier fears of an offi ce glut have absorbing both spaces due to be crisis, the Singapore government is diminished as over 95% of new offi ce vacated by Standard Chartered in 2012. optimistic that the city-state will space in 2010 has been committed. achieve annual growth of 3–5% About 58% or 2.6 million sf of the Factoring away the pre-committed for the rest of the decade. 4.4 million sf of new supply expected space of 2.6 million sf, the average to come into the market in 2011 and new supply estimated at just 1.1 million Singapore’s strategic location as 2012 has already been pre-committed, sf per year from 2011 to 2015 is a fi nancial and business hub is according to CBRE. not excessive.

Major Ofﬁ ce Leases Committed

Building (sf) Ocean Financial Centre ANZ 209,000 BNP Paribas 145,000 Drew & Napier 97,500 Verizon Communications 32,000 MBFC Tower 3 DBS 700,000 WongPartnership 93,000 McGraw-Hill 30,000 Ashurst 21,000 OUE Bayfront Bank of America Merrill Lynch 120,000 Bain & Company 30,000 Allen & Overy 26,000 Asia Square Tower 1 Citigroup 250,000 Julius Baer 71,000 Lloyd’s 65,000 Sources: CBRE, company information and various media sources

Keppel Land Limited 38 Report to Shareholders 2010 Future Ofﬁ ce Supply 2011–2015

Expected Completion Building Location NLA (sf) Pre-committed 2011 OUE Bayfront Collyer Quay 412,000 60% Ocean Financial Centre Collyer Quay 850,000 80% Asia Square Tower 1 Marina View 1,260,000 50% 3-storey podium at PSA Building Alexandra Road 25,000 n.a One Raffl es Place (Tower 2) Raffl es Place 350,000 n.a North Bridge Road – Kim Eng (own use) North Bridge Road 50,000 100% Mohamed Sultan Road (transitional offi ce) Mohamed Sultan 85,000 n.a Subtotal 3,032,000 2012 Hotel/Offi ce at Upp Pickering Street (Hotel Plaza Group) Upp Pickering Street 72,000 n.a UE Bizhub Changi Business Park 34,000 n.a Marina Bay Financial Centre Tower 3 (Phase 2) Marina Boulevard/ 1,300,000 66% Central Boulevard Subtotal 1,406,000 2013 218 Orchard Road (formerly Orchard Emerald) Orchard Road 32,000 n.a Subtotal 32,000 2014 Jalan Besar/Lavender Street Jalan Besar/Lavender 11,000 n.a Asia Square Tower 2 Marina View 782,000 n.a Hotel/Offi ce/Retail development (Ramada & Days Hotel) Balestier Road/ 70,000 n.a Ah Hood Road Jurong Gateway Road (offi ce & retail) Jurong Gateway Road 287,000 n.a Hub@one-north North Buona Vista Road 1,180,000 n.a Subtotal 2,330,000 2015 South Beach Beach Road 506,000 n.a Peck Seah Street (Guocoland) Tanjong Pagar 1,000,000 n.a Subtotal 1,506,000 n.a Total 8,306,000 Total excluding pre-committed space 5,706,000 n.a: not available

Ofﬁ ce Buildings to be Redeveloped

Building NLA (sf) Proposed Use Cecil House 50,423 Residential Aviva House 67,708 Residential VTB Building 66,888 Residential UIC Building 367,862 Residential and Commercial 76 Shenton Way 93,482 Residential StarHub Centre 269,980 Residential and Commercial Marina House 141,297 Residential and Commercial Ogilvy Centre 43,228 Hotel Chow House 31,781 Residential with Commercial StarHub Centre 269,980 Residential with Retail Keppel Towers & GE Tower 430,112 Residential with Commercial Prime Centre 72,800 Education hub and Hotel The Premier Centre 16,727 Hotel ERC Complex (formerly North Bridge Commercial Complex) 38,534 Commercial school Ocean Towers 227,429 GFA incorporated in redevelopment of OFC Corporate Offi ce 109,920 Strata offi ce/Residential with retail The Corporate Building 20,437 Strata offi ce Atrium@Orchard 125,743 Retail Total 2,444,331 Sources: CBRE, company information and various media sources

Special Feature Ofﬁ ce Market Riding on Upbeat Momentum 39 Special Feature

MARKET UPSWING TO CONTINUE and CBD areas. The future Keppel Land is well-positioned to ride on the offi ce market Offi ce demand and rentals have development of the four land parcels recovery with its sterling historically shared a close correlation in Marina Bay totalling 2.62 ha along Grade A offi ce portfolio. with the economic cycle. The strong with the remaking of the Tanjong Pagar offi ce take-up and the quantum of area will bring about a positive rental appreciation in 2010 can thus transformation to the waterfront be credited to Singapore’s record precincts and raise the attractiveness of GDP growth of 14.5% for the year. Singapore as a live-work-play destination. The stellar economic rebound has placed Singapore as the fastest- Keppel Land, as a premium growing economy in Asia and developer of offi ces in Raffl es Place second globally in 2010. and Marina Bay, is well-positioned to ride on the offi ce market recovery Singapore’s continued economic with new iconic Grade A offi ce expansion and growing appeal developments such as the as a gateway to Asia will further MBFC Tower 3 and OFC. drive offi ce demand and support rental growth. By seeking and developing quality mixed and commercial developments, Furthermore, Singapore’s land the Company will continue to shape swap with Malaysia is expected to the new urban landscape in raise the profi le of the Marina Bay Singapore’s CBD.

Demand and Rental Correlation with GDP

Demand 1.47 0.83 1.79 3.00 2.01 2.73 2.10 0.30 1.67 4.22 1.12 (0.93) (1.13) 1.07 1.96 2.40 2.07 0.19 (0.24) 1.65 (million sf)

Prime Rents 10.50 7.50 7.00 8.00 9.60 9.90 9.10 6.10 5.50 7.50 6.30 5.00 4.00 4.40 5.20 7.80 15.00 12.90 6.75 8.30 ($ psf)

GDP 6.50 7.00 11.50 10.60 7.30 7.70 8.60 (2.10) 6.20 9.10 (1.20) 4.20 4.60 9.20 7.40 8.70 8.80 1.50 (0.80) 14.50 (%)

%/$ million sf 20 5

16 4

12 3

8 2

4 1

0 0

-4 -1 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Sources: CBRE and Bloomberg

Keppel Land Limited 40 Report to Shareholders 2010 Special Feature Ofﬁ ce Market Riding on Upbeat Momentum 41 Operations and Market Review Overview

A YEAR OF EXCEPTIONAL volume may be moderated but prices Excluding corporate restructuring GROWTH should stabilise. surplus, fair value gain on investment Asia grew by an estimated 8.2% in properties/impairment and gain on 2010, according to the Economist Moving forward, growth prospects acquisition of additional interest in Intelligence Unit. A rebound in exports in Asia remain bright, despite the K-REIT Asia, net profi t from Singapore and the timely fi scal stimulus were expectation of infl ation rising before declined by about 6% to $161.6 million. important drivers in fuelling the recovery. it stabilises. Asia will remain a growth Resilient domestic demand, owing spot led by China and India. The decline was mitigated by stronger to rising income levels and increased profi t contribution from residential urbanisation also contributed to Keppel Land believes that demand projects held under associated Asia’s growth. for quality housing will be sustained companies, mainly Refl ections at on the back of healthy economic and Keppel Bay and Marina Bay Suites, as Stepping into 2011, the momentum demographic fundamentals. project sales improved and construction is likely to moderate and the key progress continued. macroeconomic challenge for Asia EARNINGS REVIEW will be dealing with rising infl ationary Singapore The share of profi t from K-REIT Asia was pressures. Monetary tightening tools Revenue from Singapore operations also higher, bolstered by contribution such as interest rate hikes, higher bank was down about 62% to $172.4 million from newly acquired assets, namely reserve requirements and exchange in 2010. Lower progressive revenue an additional 29% stake in Prudential rate adjustments have been was recognised from Singapore Tower, an offi ce tower 77 King Street in progressively introduced. residential projects following the Sydney and a 50% stake in 275 George physical completion of The Sixth Street in Brisbane, and the recovery of Apart from infl ation, higher property Avenue Residences and The Suites the Singapore offi ce market. prices and strong credit growth have at Central in 2009. raised concerns of asset bubbles. Profi t contribution from Alpha Investment Additional measures such as property Profi t recognition from The Lakefront Partners and K-REIT Asia Management taxes, lower mortgage quantum and Residences, which was launched was also stronger with higher acquisition restrictions on the purchase of second in November, will only commence and management fees earned. or more homes have been introduced in the fi rst quarter of 2011, some eight in major Asian cities to tame property weeks after buyers signed the sales On top of seizing opportunities in prices and curb speculative demand. contracts and made payment of the Singapore, Keppel Land is focused on key markets of China, Vietnam, In the near term, residential sales fi r s t i n s t a l m e n t . India and Indonesia.

Keppel Land Limited 42 Report to Shareholders 2010 Geographical Breakdown Overseas The share of overseas profi t rose further Keppel Land has consciously grown to 64% in 2006. The trend reversed in its overseas wing in the last decade 2007 as strong earnings from residential Asset Allocation to diversify out of the Singapore projects like Marina Bay Residences (as at 31 Dec 2010) market and broaden its earnings and Refl ections at Keppel Bay tipped base. Recognising that housing in favour of Singapore. %demand in Asia will be driven by rapid urbanisation, income growth Between 2008 and 2010, overseas Singapore 62.0 and favourable demographic trends, contribution rose signifi cantly from 29.5% China 20.0 the Group made its foray into the to 41% of net profi t, with China as the Vietnam 8.0 regional residential markets. dominant contributor followed by Vietnam. Indonesia 6.0 India 1.0 The successful execution of Keppel Land will continue to grow Keppel Land’s overseas strategy has sustainable earnings from overseas. Others 3.0 produced good results. The Group’s It has established Keppel Land China Total 100.0 share of earnings from overseas grew to drive growth in the fast-expanding from about 3% in 2002 to 59% in 2005, market. It will also actively seek attractive exceeding its earlier target of achieving development opportunities in other key 50% of net profi t from overseas by 2005. markets of Vietnam, Indonesia and India.

Net Profit (as at 31 Dec 2010)

% Singapore 59.0 China 30.7 Vietnam 7.2 Indonesia 0.9 India 0.4 Others 1.8 Total 100.0

Asia will remain a growth engine led by China and India.

Operations and Market Review Overview 43 The 30-ha Keppel Bay precinct is part of a vibrant waterfront city Keppel Land will continue to actively in southern Singapore and is envisioned to be a world-class lifestyle destination for exclusive seek acquisitions in Singapore, waterfront living. capitalising on opportunities and focus on developing quality residential, commercial and mixed-use projects.

Keppel Land Limited 44 Report to Shareholders 2010 Operations and Market Review Singapore

OVERVIEW a strategic hub in Asia, investment Strong Growth commitments are expected to sustain The Singapore economy achieved at $12–14 billion in 2011. a robust growth of 14.5% in 2010, buoyed by strong expansion in the To maintain Singapore’s competitiveness manufacturing and services sectors. as a Global-Asia Hub, the government is focused on containing rising inﬂ ation With the global economic recovery and enhancing productivity growth. and rising investor interest in Asia, It aims to raise real incomes of Singapore continued to draw strong Singaporeans by 30% over the investment commitments, attracting next 10 years through the upgrading about $12.9 billion in 2010, up 9.3% of skills and productivity. from $11.8 billion in 2009. It targets to boost productivity by Strong economic growth led 2–3% per year or 30% cumulatively to a buoyant job market with 115,900 over a decade. This will place the new jobs created in 2010, a three-fold city-state’s productivity level on par increase from 37,600 jobs added with the most advanced economies. in 2009. With increased hiring, the unemployment rate improved to 2.2% In restructuring the economy for from 3% in 2009 and annual wages long-term sustainable growth, the rose by 7.5% in the fourth quarter government will also support enterprise of 2010. development, assist local companies in venturing abroad and establish For the year ahead, the Singapore high-value economic clusters. economy is expected to expand at a These initiatives will enhance healthy pace of 4–6%. Capitalising Singapore’s competitive edge on Singapore’s attractiveness as in the global business arena.

Major Developments in 2010 Focus for 2011/2012

Residential g Actively seek acquisitions g Sold 650 homes, up 70% from 2009. in Singapore, capitalising g Launched The Lakefront Residences on opportunities. just six months from acquisition g Focus on developing quality of site. residential, commercial and g Increased prime residential pipeline mixed-use projects. with Keppel Towers and GE Tower. g Monitor markets and time launches for new projects and phases. Commercial g Recycle capital to take on large-scale g Achieved 1 million sf pre-commitment development projects. at Marina Bay Financial Centre and Ocean Financial Centre (OFC). g Completed asset swap between Keppel Land and K-REIT Asia. g Raised stake in OFC to 87.51%.

Operations and Market Review Singapore 45 Operations and Market Review Singapore – Residential

NEW LAUNCHES World Sentosa, the HarbourFront and the upcoming Marina Coastal The Lakefront Residences Offi ce Park and VivoCity, Keppel Bay is Expressway, Marina Bay Suites is also Located next to the Lakeside MRT station, envisioned to be a world-class lifestyle conveniently located near the future The Lakefront Residences is part of the destination for exclusive waterfront living. Downtown MRT station. Jurong Lake District, a unique lakeside destination for business and leisure. Building on the success of the Caribbean Designed by world-renowned and Refl ections at Keppel Bay, Kohn Pederson Fox Associates, The development is near the Jurong Keppel Land will start masterplanning in the development features 218 Gateway, which is set to become preparation to roll out new developments luxuriously-appointed 3- and Singapore’s largest commercial hub in the precinct which could yield 4-bedroom units ranging from 1,600 sf outside the central business district over 600 residential units. With their to 2,700 sf and three penthouses (CBD). Located close to the new unique designs and unparalleled ranging from 4,700 sf to over 8,500 sf. Canadian International School campus, waterfront ambience, buyers of these A typical fl oor has four apartments the development is a station away from iconic developments will enjoy the with private lift lobbies for every unit, Jurong Point, a popular shopping mall. tranquility of premier waterfront living, while the three penthouses each while being close to the city. boast its own swimming pool. Scheduled to be completed by 2015, About 98% of the 140 launched the development comprises 629 units Redevelopment of Keppel Towers units have been sold as at of 1- to 4-bedroom apartments and and GE Tower end-February 2011. penthouses with sizes ranging from Keppel Towers and GE Tower are 484 sf to about 3,000 sf. Facilities two freehold offi ce buildings near the Refl ections at Keppel Bay include an Olympic-length swimming Tanjong Pagar MRT station. Designed by celebrated architect pool, a bubble pool, and a thermal hot Daniel Libeskind, the iconic Refl ections spa set in a garden. Provisional permission has been granted at Keppel Bay has an extensive for these buildings to be redeveloped shoreline of 750 metres featuring The Lakefront Residences was into two residential towers comprising six glass towers of 41 storeys and launched in November 2010 with 515 units about 620 high-rise luxury homes. 24 storeys as well as 11 blocks of or 87% of 591 launched units sold as at six- to eight-storey low-rise villas. end-February 2011. Set to be transformed into a waterfront city with the relocation of ports and Topped with sky gardens on sloping PROPERTIES FULLY SOLD the Malaysian railway station, the roof lines, the towers are connected by Madison Residences rejuvenated Tanjong Pagar precinct will sky bridges which provide pockets of Located in the popular residential enclave see substantial expansion of the CBD, open spaces high above the ground of Bukit Timah, Madison Residences is integrated with quality housing, hotels, for appreciation of the panoramic views in proximity to Orchard Road, the lifestyle and tourism offerings. Buyers of the waterfront, the Keppel Club Golf upcoming Stevens MRT station as well will enjoy the excitement of luxury Course, Labrador Park, Mount Faber as premier schools such as Singapore city living. and the Resorts World Sentosa. Chinese Girls’ School and Anglo-Chinese School (Barker Road). The development is expected to Designed by Saporiti Italia, the clubhouse be launched in 2013, subject to features the fi rst-of-its-kind interactive The 18-storey development offers market conditions. designer kitchen and tower lobbies 56 exclusive units of 3- and 4-bedroom equipped with stylish art pieces. apartments and luxurious penthouses EXISTING RESIDENTIAL PORTFOLIO with sizes ranging from 1,460 sf to Marina Bay Suites Homeowners also enjoy a 10-year 4,000 sf. The stunning 66-storey Marina Bay Suites complimentary membership to Marina is situated in the new fi nancial and at Keppel Bay, which has been UPCOMING LAUNCHES business district where a wide range of recognised as the “Best Asian Marina” New Phases of Waterfront Homes lifestyle and entertainment selections like in 2010, its second award at the Asia at Keppel Bay Formula One Grand Prix night race, the Boating Awards. Located on a private To be developed in phases, the 30-ha Marina Bay Sands Integrated Resort, island and linked by the Keppel Bay Keppel Bay precinct is part of a vibrant Esplanade – Theatres on the Bay and Bridge, the marina features a clubhouse waterfront city in southern Singapore. Gardens by the Bay are located. Easily with a member’s lounge, gourmet In proximity to Sentosa Island, Resorts accessible via the East Coast Parkway restaurants and berthing facilities.

Keppel Land Limited 46 Report to Shareholders 2010 1 2

1_The Lakefront Residences received positive market response.

2_Marina Bay Suites is sought after for its location within Singapore’s new ﬁ nancial and business district.

Operations and Market Review Singapore – Residential 47 Operations and Market Review Singapore – Residential

Refl ections at Keppel Bay is scheduled The Promont, which is near the Anglo- Popular with expatriates from Europe to be ready by 2013 with 1- to 4-bedroom Chinese School (Junior), is also within and the US, Nassim Woods is 94% units and penthouses with sizes walking distance to the Orchard occupied as at end-February 2011. ranging from 700 sf to about 13,300 sf. Road shopping belt. Completed in Over 780 units or 97% of the 800 October 2009, 13 units or 87% of the THE YEAR AHEAD launched units have been sold as development have been sold as Keppel Land will stay focused on at end-February 2011. at end-February 2011. leveraging its experience and expertise in developing quality homes Caribbean at Keppel Bay Nassim Woods in Singapore, while monitoring the With its distinctive design and quality, Nassim Woods is nestled amidst a residential market to progressively the FIABCI Prix d’Excellence award- distinguished neighbourhood of foreign launch new phases at The Lakefront winning Caribbean at Keppel Bay embassies, country clubs, the Botanic Residences, Refl ections at Keppel Bay offers homeowners an exquisite Gardens, fi ve-star hotels and good-class and Marina Bay Suites. waterfront experience. bungalows. It is also near the popular and bustling shopping belt at Tanglin The Group will continue to seek This 969-unit condominium is a short drive Road and Orchard Road. opportunities to replenish its land bank to the CBD and is located near VivoCity through the acquisition of attractive and St. James Powerhouse, a popular This exclusive condominium offers residential sites located in good shopping and entertainment hub. As for lease 35 units of 3- and 4-bedroom catchment areas and with strong at end-February 2011, almost all of apartments and penthouses, with marketing attributes. the units have been sold. sizes ranging from 1,970 sf to 6,400 sf within landscaped The Promont Balinese-style grounds. Located at the hilltop of Cairnhill Circle, The Promont offers 15 luxurious units Located at the fringe of Orchard Road, of about 2,000 sf each. Residents enjoy Nassim Woods is a short drive to the CBD. full exclusivity with each unit occupying Other nearby amenities include an entire fl oor, accessible by their supermarkets, department stores, The iconic Refl ections at Keppel Bay is redefi ning private lift lobbies. cinemas and entertainment spots. waterfront living in Asia.

IN FOCUS: Cooling Measures Promote Sustainable Growth

On 13 January 2011, the government Seller’s Stamp Duty (SSD) and the new homes were sold in January 2011, introduced more cooling measures extension of its holding period, as well down 11% from 1,332 units sold in to curb speculative demand and pre- as the tightening of the Loan-to-Value December 2010. empt a property bubble. The move (LTV) limit for housing loans will aims to encourage greater fi nancial discourage speculation. As buyers adopt a more cautious stance, prudence and reduce over exposure residential take-up may moderate in to the property market among buyers. These measures are expected to bring the short term but prices are expected about a more stable and sustainable to stay relatively fi rm. Ownership This latest set of measures is more property market. Preliminary statistics aspirations, rising affl uence in the severe compared with the previous from the Urban Redevelopment region and liquidity will continue to three rounds. The sharp hike in Authority (URA) indicated that 1,189 support demand for homes.

Keppel Land Limited 48 Report to Shareholders 2010 Operations and Market Review Singapore – Residential 49 Operations and Market Review Singapore – Residential

Market Review

RECORD HOME SALES Programme. These sites can yield The Singapore residential sector about 8,100 units and 6,200 units strengthened in 2010 as market respectively. The potential supply of confi dence prevailed. Take-up of new about 14,300 units is slightly higher homes set a new record with 16,292 units than the 13,900 units made available sold, surpassing the previous high of in the second half of 2010. 14,811 units sold in 2007. Under Budget 2011 announced on While Singaporeans account for the 18 February, the government has majority of homes sold, take-up by unveiled a $10 billion plan to upgrade foreigners and permanent residents public housing estates over the next (PRs) has also increased, refl ecting 10 years. This will enhance the valuation Singapore’s growing attractiveness of these fl ats, facilitating greater as a global city. Malaysians, Mainland upgraders’ demand for private homes Chinese, Indonesians and Indian in the medium term. nationals accounted for about 30%, 25%, 24% and 16% respectively of Singapore’s household balance sheet non-landed private home transactions remains healthy. Household net wealth by foreigners and PRs for the year, has increased by about 30% to over according to statistics from URA and $1.1 billion in the third quarter of 2010 Knight Frank Research. on higher value of property holdings, according to the Financial Stability The strong demand for residential Review by the Monetary Authority of properties has spurred prices higher by Singapore. Household debt-to-assets 17.6% in 2010 compared with a 1.8% ratio remains low at about 15%. growth in 2009, based on statistics from URA. Prices of non-landed While the recent cooling measures and properties grew by 14% while landed risks of interest rate hikes have affected property prices rose 30.8% in 2010. market sentiments, continued economic expansion and the growing affl uence in To maintain a steady supply of private Asia will support healthy development housing to meet demand, the government of the residential sector in the mid- to has released more land for development. long-term. Residential projects with It placed 17 sites on the Confi rmed List and strong marketing attributes and close 13 sites on the Reserve List for the fi rst proximity to MRT stations will continue The Promont is almost fully sold as half of 2011 Government Land Sales (GLS) to be in demand. at end-February 2011.

Singapore

2009 2010E 2011F 2012F Real GDP growth (%) (0.8) 14.5 5.0 5.0 Lending interest rate (average, %) 5.4 5.4 5.4 6.2 Inward FDI (US$ bn) 16.8 14.2 19.3 22.3 Exchange rate (S$/US$, average) 1.45 1.36 1.28 1.27 Personal disposable income (US$ bn) 86.5 98.8 113.0 124.7 CPI change (average, %) 0.6 2.8 3.2 2.5 Sources: Singapore Department of Statistics and Economist Intelligence Unit

Keppel Land Limited 50 Report to Shareholders 2010 Private Residential Demand and Price Index

No. of new units sold 2,596 4,654 5,578 1,860 4,380 4,033 3,638 4,241 URA private residential price index 139.1 133.3 154.3 165.7 175.0 184.2 189.6 194.8 Set of cooling measures introduced

Units 1 2 3 4 Index 6,000 250

4,800 200

3,600 150

2,400 100

1,200 50

0 0 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 3Q2010 4Q2010 Source: URA

Cooling Measures

1st round on 14 September 2009: 3rd round on 30 August 2010: 4th round on 13 January 2011: g Reinstated the Confirmed List g Increased holding period for g Increased period for imposition for first half of 2010 GLS Programme imposition of SSD to three years of SSD to four years g Removed the Interest Absorption g For buyers with existing g Raised SSD rates to 16%, 12%, Scheme and Interest-Only Housing Loans housing loans: 8% and 4% for residential properties sold in the first, second, third and 2nd round on 19 February 2010: I. Increased minimum cash fourth year of purchase respectively g Introduced SSD on residential payment from 5% to 10% properties and land sold within one year g Lowered LTV limit on housing of purchase II. Lowered LTV limit for loans to 60% for buyers with existing housing loans to 70% housing loans g Lowered LTV limit to 80% for all housing loans g Lowered LTV limit to 50% on housing loans for corporate buyers

Operations and Market Review Singapore – Residential 51 Operations and Market Review Singapore – Commerical

OFFICE Record Pre-Commitment of Grade A Ofﬁ ce Space Keppel Land delivered strong performance in 2010, strengthening its position as the leading developer of international-grade ofﬁ ces.

The Company together with its joint venture partners, Cheung Kong (Holdings) and Hongkong Land, achieved 100% pre-commitment of the Marina Bay Financial Centre (MBFC) Phase 1 ofﬁ ce towers about four months ahead of its completion.

With a prestigious waterfront location in the new ﬁ nancial district, MBFC is the single largest mixed-use development integrating commercial, residential, retail and entertainment facilities.

Designed by the world-renowned Kohn Pedersen Fox Associates, MBFC is surrounded by new attractions like the Marina Bay Sands Integrated Resort, Art Park, ArtScience Museum, Gardens by the Bay, as well as year- round Marina Bay activities.

MBFC Tower 1, a 33-storey Grade A ofﬁ ce building comprising about 620,000 sf net lettable area (NLA), is pre-committed to international banking and ﬁ nancial institutions such as Standard Chartered Bank and Wellington International Management Company.

Standing at 50 storeys high with about delights for those who live and work at 1.03 million sf NLA, MBFC Tower 2 is Marina Bay. a Grade A offi ce building which will be home to multi-national companies and The completion of MBFC Phase 1 is a fi nancial institutions such as Barclays major milestone in the development of Capital, BHP Billiton, Macquarie, Marina Bay as a new destination for work, Nomura and Prudential. live and play, as well as in supporting Singapore’s growth as a key fi nancial Marina Bay Link Mall Phase 1 opened and business hub in the next era of its for business in the fourth quarter of 2010. economic development. As at end-January 2011, committed occupancy is about 92%. The mall has In December 2010, Keppel Land and 56 tenants with around 92,000 sf of K-REIT Asia completed an asset swap With its strategic location at retail space, offering a wide range of where Keppel Land sold its one-third Marina Bay and its close proximity to Raffl es Place, MBFC is retail services and gastronomic stake in MBFC Phase 1 to K-REIT Asia Asia’s best business address.

Keppel Land Limited 52 Report to Shareholders 2010 IN FOCUS: Is Singapore Office Market More Attractive Than Hong Kong?

Offi ce rents in Hong Kong and Analysts have attributed this to the It was the preferred fi nancial hub for Singapore have been historically difference in the supply outlook of the expatriates compared to Hong Kong, compared as both compete as two countries. Hong Kong is facing a where air pollution has been a international fi nancial centres. While supply squeeze as upcoming Grade health issue especially for those the former has appreciated closer to its A space from 2011-2013 amounts to with young children. previous rental peak in 2008, the latter only 3% of 2010 stock, ranking it last still lags behind by a large margin. among major Asian cities. Singapore’s favourable conditions as a global city put it in a pole position The gap in prime offi ce rents between However, the tight offi ce market may to benefi t from the global economic the two countries has widened over affect multi-national corporations’ recovery and the strong growth the past six quarters. (MNCs) expansion plans. Comparatively in the region. lower rents put Singapore in a better As at end-2010, the average rents light as a choice location for MNCs CB Richard Ellis (CBRE) believes there in Hong Kong’s Central district are seeking expansion. is still ample room for rental growth about HK$111 psf per month (S$18.30 here while Savills is of the view that psf per month) while prime rents in In addition, the Republic was ranked Singapore is well-placed to attract Singapore are at $8.30 psf per month, by Mercer Consulting as the Asian city surplus offi ce demand given its cost a difference of more than 50%. with the best quality of life in 2010. competitiveness to Hong Kong.

Gap in Prime Office Rentals in Singapore and Hong Kong has Widened

Hong Kong Central rents Singapore prime rents

S$ psf per month 30

25 24.9

20 18.3 16.1 15.5 15 13.9

10 8.3 7.5 6.7 5

0 3Q2007 4Q2007 1Q2008 2Q2008 3Q2008 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 3Q2010 4Q2010 Sources: CBRE and Bloomberg

Operations and Market Review Singapore – Commerical 53 Operations and Market Review Singapore – Commerical

for $1,426.8 million or $2,450 per sf Ocean Financial Centre of NLA. At the same time, K-REIT Asia Keppel Land has also raised its stake sold Keppel Towers and GE Tower in Ocean Financial Centre (OFC) to in Tanjong Pagar to Keppel Land for 87.51% after acquiring an additional $573 million for its redevelopment 11.85% stake from The Hongkong potential into a freehold residential and Shanghai Banking Corporation. project. OFC is the fourth generation building With the addition of the one-third stake to be constructed at the same historical in MBFC Phase 1, 90% of K-REIT Asia’s site as the former Ocean Building. portfolio is strategically located in the prime Raffl es Place and Marina Bay The fi rst Ocean Building was built in fi n a n c i a l d i s t r i c t s . 1864 and was redeveloped in 1923 and 1974, each time at the watershed Projects under Development of Singapore’s economic development. Marina Bay Financial Centre Phase 2 Phase 2 of MBFC comprises a 46-storey Located above the Raffl es Place MRT offi ce tower and 221 luxurious residential station, OFC is at the intersection of the units at Marina Bay Suites. The central business district (CBD) and the development will be complemented by new fi nancial hub at Marina Bay. retail and recreational facilities and linked via its own underground OFC is designed by the internationally- pedestrian network to the new acclaimed architectural fi rm, Pelli Downtown and existing Raffl es Place Clarke Pelli, whose portfolio includes MRT stations. many landmark developments in major fi n a n c i a l c i t i e s . In addition to anchor tenant DBS Bank, which has pre-committed approximately Upon completion, the 43-storey 700,000 sf or 55% of Tower 3, building will be one of the largest WongPartnership, Ashurst and offi ce developments in Raffl es Place McGraw-Hill have also signed up. providing about 850,000 sf of column-free Grade A offi ce space as When completed in 2012, the tower well as state-of-the-art environmentally block with 1.3 million sf NLA will be responsible features. OFC will also the largest offi ce tower in Singapore, feature a landscaped public plaza with two of the largest trading fl oors and a sky-garden. at 45,000 sf. The retail component comprises about 82,910 sf and is OFC is about 80% pre-committed, expected to complete in the second ahead of its completion in the second quarter of 2012. quarter of 2011.

MBFC has achieved the Green Mark It has attracted blue-chip fi nancial GoldPlus for Tower 3 and Green Mark insititutions such as ANZ and BNP Gold Awards for Towers 1 and 2, Paribas as well as tenants from the Marina Bay Residences and former Ocean Building and Ocean Marina Bay Suites. Towers, such as Drew & Napier and DMG & Partners Securities. These awards, conferred by the Building and Construction Authority The return of these long-time tenants (BCA), recognise developers’ efforts in is a testimony to the good relationships Keppel Land’s senior management the area of sustainable design. MBFC established with Keppel Land, as well briefi ng Ms Grace Fu (extreme is one of the few developments to win as the affi rmation of trust in the quality right), Senior Minister of State for National Development on the green more than one BCA Green Mark Award. of the new Grade A offi ce building. features of Ocean Financial Centre.

Keppel Land Limited 54 Report to Shareholders 2010 Operations and Market Review Singapore – Commerical 55 Operations and Market Review Singapore – Commerical

OFC is the fi rst high-rise offi ce development in Singapore to achieve the Green Mark Platinum Award, the highest green accolade conferred on an environmentally- friendly building by the BCA. It is also the fi rst high-rise offi ce development in Southeast Asia to be conferred the prestigious Platinum Level LEED-CS pre-certifi cation under the Leadership in Energy and Environmental Design (LEED) Green Building Rating System.

It offers one of the largest ﬂ oor plates in the Rafﬂ es Place with areas ranging from 19,000 sf to 23,000 sf. By integrating eco-features into the building design, OFC will achieve overall energy savings of 35%.

OFC will feature the use of triple glazed full-height glass curtain wall with low-emissive coating to maximise light transmittance while minimising heat gain. The introduction of a paper-recycling chute will encourage tenants to recycle and save more than 10,000 trees annually.

OFC is among the ﬁ rst commercial buildings whose design and planning have adopted the lighting and art incentives initiative introduced by the Urban Redevelopment Authority (URA) in the business and ﬁ nancial district.

Ocean Financial Centre is the ﬁ rst high-rise ofﬁ ce building in Southeast Asia to achieve the Platinum Award under Leadership in Energy and Environment Design (LEED) Green Building Rating System.

Keppel Land Limited 56 Report to Shareholders 2010 Completed Buildings With the Resorts World Sentosa The Group will also continue to Equity Plaza Integrated Resort now opened, the foster good relationships with Located in Raffl es Place, Equity Plaza HarbourFront precinct has enhanced its tenants, through proactive is majority-owned by Keppel Land and its attractiveness as a live-work-play negotiations to better understand provides about 0.25 million sf NLA. locale. The HarbourFront Offi ce Park is and respond to their leasing needs. well-poised to capitalise on its location, The completion of upgrading works for unobstructed sea views as well as its MBFC Phase 2 and OFC, with Equity Plaza in 2009 to enhance the connectivity to the HarbourFront MRT pre-commitment rates of 66% building’s image and competitive edge station. Keppel Bay Tower is also a and about 80% respectively as was well-timed to capitalise on the recipient of the BCA Green Mark Gold at end-2010, will fortify the upswing in offi ce market sentiments. Award under the competed buildings Group’s position as a major category in 2010. developer in both the existing In recognition of its commitment to and new fi nancial districts. adopting eco-friendly building features, LOOKING AHEAD Equity Plaza received the BCA Green With improved economic sentiments Mark Gold Award in 2010. in Singapore and the region, the offi ce market is primed to remain fi rm with HarbourFront Offi ce Park leasing activities mainly driven by new Conveniently located fi ve minutes expansion among the fi nancial and from the CBD and with covered professional services companies. linkages to the HarbourFront MRT Keppel Land will continue to acquire station, the 0.9 million sf HarbourFront attractive sites for commercial Offi ce Park comprises Keppel Bay development and focus on active asset Tower, HarbourFront Tower One and management to enhance operational Keppel Bay Tower in the HarbourFront Offi ce Park is a HarbourFront Tower Two. and cost effi ciency. Green Mark Gold rated building.

Operations and Market Review Singapore – Commerical 57 Operations and Market Review Singapore – Commerical

Market Review

OFFICE Office Demand and Supply Strong Rebound After six consecutive quarters of Supply contraction, offi ce rents turned the (million sf) 0.69 (0.05) 1.42 2.38 1.93 corner in the second quarter of 2010 Demand (million sf) 2.40 2.07 0.19 (0.24) 1.65 as the economy emerged stronger. Island-wide Occupancy (%) 89.70 92.70 91.20 87.90 87.90 Leasing activity increased and offi ce rents strengthened further in the Grade A Occupancy (%) 99.20 99.80 99.10 93.80 97.30 second half of 2010 on the back of a strong economic rebound. million sf % 2.5 100 According to CBRE, average Grade A and prime offi ce rents were $9.90 psf 2.0 97 per month and $8.30 psf per month in the fourth quarter respectively, 1.5 94 an increase of 22% and 23% from a year ago. 1.0 91 Grade A offi ce take-up also increased to 1.47 million sf in 2010, 0.5 88 a major jump from a negative take-up of 0.13m sf in 2009 0 85 according to CBRE.

As Singapore staged an astounding (0.5) 82 recovery, tenants resumed their 2006 2007 2008 2009 2010 premises planning activities and capitalised on the attractive rents for relocations to better-quality Average Office Rents buildings. This “fl ight to quality” ($ psf/month) effect provided support for rents and occupancies of prime and Grade A Rent 8.73 17.15 15.00 8.10 9.90 well-maintained offi ces. Prime Rent 7.81 15.00 12.90 6.75 8.30 20 The recovery in offi ce rentals moved Singapore up to 25th position in 15 CBRE’s latest ranking of the world’s 50 most expensive offi ce markets, up from its 32nd position a year ago. 10 Compared with Hong Kong which is in the second position, 5 Singapore is competitive as a location for companies. 0 2006 2007 2008 2009 2010 Sources: URA and CBRE

Keppel Land Limited 58 Report to Shareholders 2010 The commitment by major fi nancial (GLS) Programme will ensure a steady Singapore remains an attractive business destination for institutions to long-term leases is stream of available offi ce space from multi-national companies a sign of their underlying confi dence 2013 onwards. and fi nancial institutions looking in Singapore. to expand in the region. The variety of available commercial The overall upswing in economic activity sites under the GLS Programme has bolstered occupier demand, with refl ects the government’s intention to sectors such as insurance, commodities, create new decentralised commercial information technology and foreign hubs in the eastern and western parts legal fi rms. Grade A occupancy rate of the island, as well as to continue increased to 97.3% as at end-2010 developing the Tanjong Pagar district. compared with 93.8% a year ago. The outlook for the offi ce market Most of the upcoming offi ce supply remains positive. On the back of have been substantially pre-committed. strong market conditions and business The release of more commercial sites confi dence, there is room for further under the Government Land Sales rental growth.

Operations and Market Review Singapore – Commerical 59 Operations and Market Review Singapore – Commerical

KEPPEL DIGIHUB Market Review HOSPITALITY MANAGEMENT Data Centres Sedona Hotels International Keppel Digihub’s data centre, a Keppel Land’s hotel management arm, provider of outsourced data support Sedona Hotels International (Sedona), infrastructure, is a six-storey building manages over 1,100 hotel rooms and located in Serangoon North. DATA CENTRES serviced apartments across the region. Growing Demand The facility’s co-location offerings The global data centre market is International Tourism range from private suites to large experiencing strong demand due on the Upswing customised spaces, providing to tight supply arising from factors International tourism continues to recover multi-national companies, fi nancial such as the growing prevalence of from the impact of the global economic institutions and IT service providers cloud computing and increasing crisis. According to the United Nations with exacting standards for power data storage requirements. World Tourism Organisation (UNWTO), and cooling availability. Operational international arrivals rose by 6.7% to since 2001, it continues to maintain As there was limited data centre 935 million in 2010. zero downtime track record. expansion in 2009 due to the economic downturn, 80% of the major data Asia Pacifi c posted an impressive As a carrier-neutral data centre centres in Asia-Pacifi c are now 13% growth in international arrivals. operator, Keppel Digihub works with running at close to 90% capacity. UNWTO expects growth in international best-in-class service providers to tourist arrivals to moderate to 4–5% optimise data centre capacity, This pent-up demand has prompted in 2011. maximise energy effi ciency and major data centre players to embark ensure power and cooling availability. on expansion plans for their Sedona intends to benefi t from It has been certifi ed as a disaster current facilities. increased international arrivals in Asia recovery facility provider by expanding its pool of travel partners, since 2006. Another emerging market trend is participating in international trade shows the growing demand for higher as well as increasing online presence In 2010, Keppel Digihub fi tted out power and cooling densities in and branding. Online marketing platforms an additional 25,000 sf of data centre data centres, which gives newer such as social media sites and peer- and business recovery space to facilities the competitive edge to review sites present new marketing cater to the infrastructure needs include these requirements in their opportunities for Sedona to reach out of a customer. new space fi t-outs. to a wider yet measurable audience.

With increasing demand for its With national initiatives such as Indonesia high quality services, Keppel the new 12-ha data centre park Indonesia welcomed more than 7 million Digihub plans to ﬁ t-out the spearheaded by the Infocomm foreign tourists in 2010, representing a remaining space of its facility Development Authority of Singapore, 10.7% rise over 2009. for co-location uses, bringing an increase in demand for data centre the total data centre and disaster space can be expected. Hotel Sedona Manado is dedicated recovery space to more than to eco-tourism and is frequently 110,000 sf. recognised for its proactive and innovative practices towards To capitalise on the rapidly growing environmental management. market for connectivity and data hosting in the region, Keppel Land Hotel Sedona Manado stands to and Keppel Telecommunications & beneﬁ t from Indonesia’s 2011 goal of Transportation have formed a joint attracting 7.7 million foreign visitors venture company in January 2011 to with its plan to promote the country’s consolidate their data centre assets eco-cultural attractions. and position for further growth. The hotel will continue to expand its Keppel Digihub will now be managed leisure market by creating packages by the joint venture company. and incentivising its travel partners.

Keppel Land Limited 60 Report to Shareholders 2010 In addition, the hotel will build on its achievements in environmental practices as part of its overall eco-friendly efforts.

Vietnam The Vietnam National Administration of Tourism implemented a tourism stimulus campaign named “Vietnam – Your Destination” in a bid to attract more travellers. The campaign exceeded its target of 4.2 million foreign tourists, welcoming 5 million international arrivals in 2010, up 34.8% over 2009.

While Sedona Suites Hanoi and Sedona Suites HCMC maintain their leadership positions and market share, the construction of the extension of Saigon Centre may result in a slight drop in long-stay residents. As such, Sedona Suites HCMC will allocate a greater share of its accommodation for short-term stay.

To further enhance their leading status as a choice accommodation provider, Sedona Suites Hanoi and Sedona Suites HCMC are undergoing a soft refurbishment of its guest rooms and suites.

Myanmar A visa-on-arrival system was introduced from June to October to boost foreign arrivals in Myanmar. Even though this scheme was suspended when Myanmar prepared for its ﬁ rst election in two decades, post-election demand for rooms went up. A total of 295,174 Hotel Sedona Manado regularly receives recognition for its proactive foreign tourists passed through the and innovative eco-practices. Yangon gateway in 2010, a 29.8% increase from 2009.

Sedona Hotel Yangon performed well Properties Managed by Sedona Hotels International with increased occupancy and strong contribution from its Food & Beverage No. of Rooms/ business. The thrice-yearly Gem Country Name of Property Location Units Emporium in Yangon has been moved Indonesia Hotel Sedona Manado Manado 247 to Myanmar’s capital city in Naypidaw. Myanmar Sedona Hotel Yangon Yangon 366 In view of this, Sedona Hotel Yangon Sedona Hotel Mandalay Mandalay 247 will extend its marketing efforts to the Vietnam Sedona Suites Ho Chi Minh City Ho Chi Minh City 89 European market and forge closer ties Sedona Suites Hanoi Hanoi 175 with international tour operators. Total 1,124

Operations and Market Review Singapore – Commerical 61 K-REIT Asia’s sterling ofﬁ ce portfolio in Singapore is mostly K-REIT Asia’s portfolio of Grade A located in the prime Rafﬂ es Place and Marina Bay precincts. office developments puts it in good stead to ride the office market recovery.

Keppel Land Limited 62 Report to Shareholders 2010 Operations and Market Review Property Fund Management

K-REIT ASIA interest in 275 George Street and A Transformational Year an offi ce tower 77 King Street. K-REIT Asia, a real estate investment The two freehold Grade A offi ce trust sponsored by Keppel Land, buildings are located in Brisbane completed three acquisitions and one and Sydney’s central business divestment in 2010 which transformed districts (CBDs) respectively, and are and enlarged its property portfolio to tenanted by leading companies such $3.5 billion as at 31 December 2010, as Queensland Gas Company, Telstra up from $2.1 billion a year ago. It is Corporation and Fitch Australia. currently ranked among the top fi ve S-REITs in terms of asset size. Positive Financial Performance K-REIT Asia delivered a 20.6% K-REIT Asia divested Keppel Towers increase in Distribution Per Unit (DPU) and GE Tower (KTGE) for $573 million to 6.37 cents for 2010 compared to to Keppel Land during the year and 5.28 cents for the year before. in return, acquired Keppel Land’s one-third stake in Marina Bay Financial Distributable income grew 21.4% Centre Towers 1 & 2 and Marina Bay year-on-year to $85.6 million on Link Mall (MBFC Phase 1) for higher net property income which $1,426.8 million. rose 37.7% to $67.3 million and higher contribution from associated The strategic asset swap upgraded companies which increased 18.1% K-REIT Asia’s portfolio without to $9.7 million in 2010. having to raise additional equity. After the swap, 90% of K-REIT Asia’s Robust Fundamentals assets under management in As at 31 December 2010, K-REIT Asia’s Singapore are located in the prime portfolio occupancy rate was 97%. Raffl es Place and Marina Bay precincts. The weighted average lease expiry for the whole portfolio and for the K-REIT Asia also completed two other top 10 tenants stood at 7.6 years offi ce acquisitions in Australia – a 50% and 8.8 years respectively.

Major Developments in 2010 Focus for 2011/2012

K-REIT Asia K-REIT Asia g Completed asset swap with g Pursue acquisition opportunities Keppel Land. to strengthen position as a leading g Made first foray overseas. pan-Asian commercial REIT. g Enlarged portfolio size to g Improve operational and $3.5 billion as at end-2010. capital efficiencies to optimise asset performance. Alpha Investment Partners g Top quartile manager in pan-Asian Alpha Investment Partners fund management. g Grow existing businesses in Asia. g Active asset acquisitions. g Explore opportunities to buy g High returns from into fund management platforms asset divestments. in Europe and the US.

Operations and Market Review Property Fund Management 63 Operations and Market Review Property Fund Management

K-REIT Asia maintains a well-balanced MARKET REVIEW in MBFC Phase 1. Likewise, Ascott lease expiry profi le with total lease Real Estate Investment Trusts Residence Trust used the proceeds expiry in each year not exceeding 20% S-REIT Sector Expanded from selling The Ascott Beijing to of total portfolio net lettable area and The Singapore real estate investment partially fund the acquisition of gross rental income. trusts (S-REITs) sector posted strong 28 properties from The Ascott. recovery in 2010 on the back of K-REIT Asia leveraged the improved exceptional economic growth. Favourable credit markets and ample credit markets to refi nance its More S-REITs were trading at a liquidity also provided a more positive borrowings, reducing the all-in premium to their net asset values in environment for acquisitions which average cost of borrowing to 2.75% 2010 compared to the year before. saw S-REITs acquiring approximately and improving the debt expiry profi le The total market capitalisation of $5.6 billion of assets in 2010. to approximately 4.2 years as at 21 S-REITs, which were listed as Overseas investments accounted 31 December 2010. at the end of 2009, increased for about half of the total investment approximately 28.5% to $35.7 billion value, driven by positive asset yields Looking Ahead as at end-2010 from $27.8 billion and low borrowing costs. Prominent Active asset management and at end-2009. overseas investments included fi nancing initiatives, coupled with Starhill Global REIT’s acquisition the DPU accretive acquisitions, have Improved Credit and of David Jones Building in Perth, improved K-REIT Asia’s portfolio Equity Markets Australia, Parkway Life REIT’s fundamentals and cash fl ow Amidst a more positive credit market acquisition of six nursing home and resilience, positioning it for growth. in 2010, most S-REITs improved care facilities in Japan as well as the management of their capital K-REIT Asia’s acquisition of offi ce Keppel Land, as its sponsor, will structures by issuing equity, refi nancing assets in Australia. continue to offer potential growth borrowings ahead of schedule, avenues for K-REIT Asia with a extending debt maturity profi le Looking Ahead pipeline of properties for potential and diversifying sources of borrowings The stable performance and improved acquisition, as well as lend through convertible bonds and multi- fi nancial fl exibility of S-REITs as well its extensive network and term notes. The S-REIT sector had as the strong economic recovery development expertise. more than $18.1 billion in borrowings led Moody’s Investor Service to as at end-2010, of which approximately upgrade the S-REIT sector outlook K-REIT Asia remains focused on 12.6% or $2.3 billion are due for from ‘negative’ to ‘stable’ in July 2010. improving operational and capital refi nancing in 2011. Most of the rated S-REITs have effi ciencies to optimise the either a ‘stable’ or ‘positive’ outlook performance of its assets and Improved equity markets have also as at end-2010, refl ecting the deliver stable and sustainable enabled S-REITs to raise approximately improvement in market conditions returns to Unitholders. It will $2.1 billion of fresh equity in 2010, and the respective managers’ selectively pursue opportunities largely through private placements and positive track record. for strategic acquisitions that will rights offerings, to fund yield-accretive complement its existing portfolio acquisitions and for working capital As at end-2010, the aggregate and strengthen its position as a purposes. Three new industrial REITs leverage for S-REITs ranged leading pan-Asian commercial REIT. were listed on the Singapore Exchange between 19% and 41%. As S-REITs in 2010. with published credit ratings are For more information, please refer to permitted a maximum gearing of K-REIT Asia’s annual report available Portfolio Optimisation and 60%, S-REITs with modest gearing online at www.kreitasia.com. Acquisitions levels will likely fund yield-accretive 2010 saw several S-REITs adopting assets using debt for as long as a reconstitution strategy to improve interest rates remain at comfortable their asset portfolio through strategic levels. S-REITs are also expected divestments and using the divestment to continue to increase their fi nancial Growing as a pan-Asian REIT, proceeds to acquire yield-accretive fl exibility through long-term funding K-REIT Asia captured opportunities in Australia with acquisitions such assets. K-REIT Asia, for example, and release of more encumbered as prime commercial building channelled the proceeds from divesting properties when they refi nance 77 King Street, which is located in Sydney’s CBD. KTGE to acquire a one-third interest existing debt.

Keppel Land Limited 64 Report to Shareholders 2010 Operations and Market Review Property Fund Management 65 Operations and Market Review Property Fund Management

ALPHA INVESTMENT PARTNERS Asia’s developed and emerging Looking Ahead Acquisition Growth markets and targets investments From a small team in 2004, Alpha has While the defensive strategy employed from core plus to opportunistic. grown to its current strength of 47 at the onset of the global fi nancial crisis Employing a barbell strategy, the professionals managing an AUM of helped Alpha Investment Partners (Alpha) fund has done exceptionally well in $7.7 billion when fully leveraged and fully weather the downturn, management spite of its inception vintage. The invested. Alpha’s outperformance in 2010 discipline and a more active investment macro trends identifi ed have also amid a challenging investment pace in 2010 enabled Alpha to achieve remained resilient and intact, climate is testimonial to its sound, a sterling year. allowing Alpha to invest into the disciplined and prudent investment growing sectors of the markets and management model. Alpha-managed funds navigated the resulting in the outperformance of tough investment climate well and the fund. Alpha will continue to establish and grow posted positive returns in 2010. its existing business in Asia and actively Growing Alpha’s Regional Wing seek opportunities to buy into fund All Alpha-managed funds delivered With an enlarged asset under management platforms in Europe and the positive returns and outperformed most management (AUM), new hires were US. It aims to grow into a global player industry peers of the same vintage year1. made across all the key functions in real estate fund management, with In a Preqin report published in November in asset management, investment, the support of its shareholders as well 2010, 79% of real estate funds with fi nance and administration. as its blue-chip institutional investors. vintage year 2007 had negative returns while a comparable Alpha-managed Alpha grew its teams in Singapore, 1 Source: estimated from chart in Preqin report “What fund achieved positive returns in Tokyo and Seoul, as well as extended Now for Private Equity Real Estate”, Nov 2010 excess of 20%. its investment footprint in North Asia 1_Alpha Asia Macro Trends Fund has with a branch offi ce in Taipei, Taiwan. a 77% stake in the new Katong Mall Alpha currently manages several This expansion has strengthened which offers a net lettable area of some 207,000 sf. funds in its portfolio. During the year, Alpha’s capabilities and improved Alpha continued with its successful local execution capabilities in its 2_Grade A offi ce development, Seoul Square, in South Korea divestment programme for its Asia key investment markets. augments Alpha’s portfolio. No.1 Property Fund, bringing the total divested assets to nine out of 17 assets. The total investment return from these 1 divestments has exceeded the fund’s targeted returns, ranging from 20% to 2 million% with equity multiples from 1.43 to 3.21 times.

The Alpha Core-Plus Real Estate Fund, targeting the mature markets of Japan, Singapore, Hong Kong and South Korea, has also performed well. Proactive asset and ﬁ nancial management have led to the timely sale of an investment and the reﬁ nancing of various assets, further improving the portfolio’s cash position. Portfolio outperformance is characterised by occupancy in excess of 90%, increases in net asset value and property income.

The Alpha Asia Macro Trends Fund (AAMTF) is a pan-Asian fund with an equity of $1.7 billion. The fund has identiﬁ ed speciﬁ c macro trends in

Keppel Land Limited 66 Report to Shareholders 2010 2

MARKET REVIEW post-fi nancial crisis landscape, when measured by their internal Real Estate Fund Management investors are exercising extra caution, rate of return. Fund-raising remained challenging in conducting more extensive due 2010 as investors stayed cautious and diligence on new fund managers Looking ahead, the fund-raising were less willing to commit to new and investment products before environment is gradually improving funds. Fund-raising for private equity commitment. A long, successful but will remain challenging. A survey real estate fund in Asia was affected and consistent track record is now a by Preqin conducted in 2010 revealed with a total of 12 funds raising an prerequisite for fund manager selection. that only 42% of investors are planning aggregate of US$2.9 billion, the lowest to make new commitments over the amount of capital raised since 2004. Despite the slow fund-raising next 12 months. However, investors environment, capital raised for are still keen to benefi t from the rapid The economic downturn had an Asia-focused funds had delivered growth in emerging economies, with adverse impact on investors in North a more consistent performance a signifi cant 45% indicating interest in America and Europe, with some holding compared to the North American Asia and Rest of the World vehicles. back investment decisions while others or European vehicles. Statistics from Some 73% of investors are still below concentrated on investments nearer Preqin, a consultancy fi rm specialising their targeted real estate allocations. to home. Consequently, Asia-focused in alternative asset industry, indicated Market uncertainties, rather than fund-raising by North American and that approximately two-thirds of cash fl ow constraints, seem to be European managers was affected. 2006’s and 79% of 2007 vintage funds the primary factor behind low Due to a more challenging recorded negative investment returns, commitment levels by institutions.

Operations and Market Review Property Fund Management 67 The Park Avenue precinct in Shanghai has attracted homebuyers Keppel Land strengthened its growth to its residences in One Park Avenue and 8 Park Avenue. platform in China with the establishment of Keppel Land China to sharpen focus and capture more opportunities in the fast growing market.

Keppel Land Limited 68 Report to Shareholders 2010 Operations and Market Review Overseas – China

CAPITALISING ON CHINA’S GROWTH Extending its reach further into Jiangsu, According to the General The Group reorganised its operations Keppel Land China made its maiden Administration of Customs, China’s and fortifi ed its position in China with the residential acquisition of a 17.2-ha exports and imports surged to nearly establishment of Keppel Land China lakefront site in the city of Nantong. US$3 trillion, an increase of 34.7% to sharpen focus on expanding its over the previous year. Exports footprint in the vast and growing Keppel Group’s showcase for integrated of US$1.58 trillion exceeded market. As China is now a major sustainable urban solutions, the expectations of an 8% growth, component in the Group’s regional Sino-Singapore Tianjin Eco-City recording a robust growth of 31.3% strategy, the new entity will allow the (Eco-City) continued to make steady for the year while imports rose by Group to consolidate its operations, progress. Keppel’s fi rst collection of 38.7% to US$1.39 trillion. improve execution in this growth market eco-homes in the Eco-City, Seasons and maximise value creation. Park, was launched during the year and In line with China’s economic registered strong sales. expansion, foreign direct investment Since establishment, Keppel Land (FDI) crossed the US$100 billion mark China had acquired two prime sites ECONOMIC REVIEW in 2010. The strong FDI infl ow is largely for high-end residential developments Double-digit GDP Growth due to labour competitiveness and in Chengdu. After two years of single-digit growth, rising domestic consumption. China returned to double-digit GDP As leader of the Singapore consortium growth of 10.3% in 2010. The country For 2011, the Chinese government in the development of the Suzhou surpassed Japan as the world’s second has announced a shift to prudent Industrial Park, the Keppel Group has largest economy and is expected to monetary policy to control liquidity established early presence in the Jiangsu take the fi rst place before 2030. and infl ation. China started to raise Province more than a decade ago. interest rates after holding them steady With the rising importance of China for three years. Between October 2010 Keppel Land continued to strengthen globally, the economic powerhouse and February 2011, the lending and its position in the Jiangsu Province with also known as the factory of the world, deposit rates were raised on three residential developments in main cities is expected to continue its role as occasions by 0.25% each time to such as Wuxi, Jiangyin and Changzhou. Asia’s growth engine. 6.06% and 3% respectively.

Major Developments in 2010 Focus for 2011/2012 g Record sales of more than 4,000 g Leverage strong track record homes sold in China. and relationships for future g Launched first eco-homes in the project developments. Sino-Singapore Tianjin Eco-City. g Seek acquisition of attractive g Set up Keppel Land China to development sites. expand presence. g Launch new units at 8 Park Avenue g Acquired two residential sites in in Shanghai, new phases of Chengdu, maiden site in Nantong township homes in Chengdu in Jiangsu Province and additional and Wuxi as well as a new township site in Zhongshan. development, The Seasons, in Shenyang.

Operations and Market Review Overseas – China 69 Operations and Market Review Overseas – China

As an economic powerhouse, China is expected to continue its role as Asia’s growth engine.

With rebalancing the economic structure The measures saw home sales volume to achieve sustainable growth as the declined in most cities. However, prices primary focus, the Asian giant has remained fi rm as new home prices in estimated GDP growth of about fi rst-tier cities recorded an increase 9.0% in 2011. of 35.4% year-on-year in 2010, while prices in second-tier cities rose by Tightening Measures 26.1%. According to property research To curb the soaring property market, consultant DTZ, the strong demand the government laid out a series of was largely attributed to the booming tightening measures throughout 2010. economy and city rejuvenation. While the number of total transactions was affected, there was no signifi cant With new measures in place, investment impact on the luxury residential market. demand is likely to be affected while end-user and upgrading demand The tougher measures will have a will continue to drive the market. The greater impact on the sales volume and authorities will continue to keep a close prices in major cities compared to the watch and manage the property market second and third-tier cities. to ensure a stable and healthy growth.

China

2009 2010E 2011F 2012F Real GDP growth (%) 9.2 10.3 9.0 8.7 Lending interest rate (average, %) 5.3 5.8 6.8 7.3 Inward FDI (US$ bn) 78.2 101.2 110.2 113.5 Exchange rate (RMB/US$, average) 6.83 6.77 6.48 6.23 Personal disposable income (US$ bn) 2,123 2,453 2,940 3,480 CPI change (average, %) (0.7) 3.2 5.0 3.8 Sources: Economist Intelligence Unit and Economic Forecasting Institute of the China Academy of Sciences

Keppel Land Limited 70 Report to Shareholders 2010 IN FOCUS: Will Measures Tame Property Market in China?

The State Council made two major apartments in Chongqing and 0.4–0.6% lingering concerns over the possibility announcements, introducing eight in Shanghai on newly-bought second of further policy implementations keep new cooling measures on 26 January homes. The property tax measure will buyers on the sideline. It will give the 2011 and implementing a preliminary be extended to other cities gradually. market enough time to digest and round of property tax the following Non-permanent residents will also face cushion the negative impact. day with the intention to curb prices in similar tax rates for the purchase of new cities where prices are rising rapidly. homes, affi rming the government’s As property prices stabilise and the intent in weeding out speculators. Chinese economy maintains a healthy Among the changes, the more growth momentum, local demand will signifi cant are the extension of The property tightening measures provide further support to prices and home purchase restriction to more introduced were deemed necessary volume, thus ensuring a healthy and cities and most recently to Shanghai for a fundamentally sound property balanced property market growth in and Guangzhou, the imposition of market and to prevent the formation the longer term. 5.5% business tax on the total sales of an asset bubble. The authorities amount if a property is sold within fi ve reported that the latest property tax China’s urbanisation pace has years of purchase and the increase can guide residents towards more accelerated rapidly, estimated to reach of down-payment ratio to 60% for the rational housing consumption and 50% by 2020. Rising home-ownership purchase of a second home. also promote social equality. aspirations, and the increasing affl uent young middle-class will continue to A property tax of 0.5–1.2% per annum Transaction volume is expected drive demand for quality residential will be levied on villas and luxury to remain fl at in the near term as properties in the years ahead.

Rising home-ownership aspirations will continue to drive demand for quality housing in China.

Operations and Market Review Overseas – China 71 Operations and Market Review Overseas – China

The Springdale meets rising SHANGHAI A new metro Line 11 extension linking demand for homes in the growing Pudong District in Shanghai. The Springdale Shanghai downtown with Lingang The Springdale is a 26.4-ha New City is planned to be operational development comprising about 2,700 in 2012. The Xinchang Town Station is units of terraces and high- and low-rise a 20-minute walk from The Springdale. apartments, complemented by full-facility Adding to the attractiveness of the clubhouses and retail outlets. The project is the upcoming Shanghai development is located in Xinchang Disneyland, due to open in 2015, which Town, in the previous Nanhui District is about a 15-minute drive away. in southeastern Shanghai which has been re-designated as part of the The Springdale was launched in June Pudong District. 2010 and has been well-received by the market. As at end-February 2011, 99% In the southeastern tip of Pudong of the 664 units launched have been sold. District, the Shanghai government is building Lingang New City to support The Springdale is well-positioned to the activities of the Yangshan Deep- beneﬁ t from the development of Lingang Water Port. Lingang New City will be New City and the increased economic both a port city and an industrial park, activities in the Pudong District which and home to 800,000 people by 2020. will create greater demand for housing.

Keppel Land Limited 72 Report to Shareholders 2010 Park Avenue One Park Avenue and terraces, with a full-facility The Park Avenue precinct comprises The residential development, comprising clubhouse, including indoor three projects – One Park Avenue, 1,118 apartments, was fully sold in 2003 heated swimming pool, gymnasium, 8 Park Avenue and Park Avenue Central. and handed over to buyers in 2005. tennis courts and function rooms.

Located in downtown Shanghai in the 8 Park Avenue Located in the Xujing Town of Qingpu prime Jingan District, Park Avenue is Comprising 930 apartments spread over District, Villa Riviera is about 1 km highly accessible, close to expressways 10 high-rise blocks, 8 Park Avenue from the Xujing Town Centre and and the Jingan metro line. A new metro has clubhouse facilities that include a 30-minute drive to Shanghai’s Line 7 was opened in 2010 and is less an indoor heated swimming pool, city centre. than 100 metres away from the Park gymnasium, tennis courts and a Avenue precinct. bowling alley. The extension of metro Line 2 which was completed in 2010 Park Avenue is located near the well- All 552 units in the ﬁ rst six blocks have further improved accessibility. known Nanjing West Road commercial been sold and handed over to buyers. Nearby amenities include the belt and major hotels. These include Construction is currently underway for hypermart Carrefour as well as the Plaza 66, Shanghai Centre, Citic the remaining four blocks of 378 units American, French, German and Centre, the Shanghai Exhibition Centre and two blocks are expected to be Singapore international schools, as well as the Portman Ritz-Carlton launched in 2011. which cater to the expatriate and JC Mandarin hotels. The Shanghai population in the area. Children Hospital and one of Shanghai Villa Riviera city’s top primary schools, First Centre Keppel Land’s ﬁ rst villa development All 168 units of the development Primary School, are also within walking in Shanghai, Villa Riviera, comprises were fully sold and completed distance to Park Avenue. 168 units of villas, semi-detached in 2010.

ECONOMIC REVIEW expected to provide further impetus for announced in early October managed Shanghai Continues to Fuel the hotel, tourism and retail sectors. to cool the market temporarily, but China’s Growth new home sales rebounded after fi ve Shanghai achieved a GDP growth Ranked by Dow Jones International weeks, an indication of the strong of 9.9% in 2010, bringing GDP to Financial Centres Development Index pent-up demand. RMB1,687 billion (US$256 billion). as the eighth most competitive fi nancial The city’s bustling port handled a total centre worldwide, Shanghai’s economy Going forward, demand for residential of 29 million twenty-foot equivalent units, is poised to continue as a key engine properties in Shanghai will remain surpassing Singapore as the world’s of China’s growth. strong, underpinned by urbanisation, busiest port. economic growth and rising affl uence. MARKET REVIEW Harbouring the ambition to be an Steady Growth The development of a high-speed rail international fi nancial centre and Despite the introduction of tightening network across key cities in China shipping hub by 2020, Shanghai plans measures by the government to manage will also shape the property markets to restructure its economy and shift its asset infl ation and curb speculation, in the respective cities. The Shanghai focus to the higher value services industry. residential prices in Shanghai remained government plans to invest into stable in 2010. The Shanghai luxury another 184 km of metro tracks. In 2010, the Shanghai World Expo held residential market ended the year with between May and September raised an average price growth of 1.5%. The infrastructure improvement is its international recognition levels for envisaged to accelerate the shift the city with 73 million visitors. The Transaction volumes slowed down towards a global fi nancial and shipping development of the Disney theme park initially in April 2010 but picked up centre, continuing its goal to attract scheduled to be completed by 2015 is in August. Additional measures talent and investment into the city.

Operations and Market Review Overseas – China 73 Operations and Market Review Overseas – China

TIANJIN residential developments and commercial Phase 1 comprising 83 bungalows and Sino-Singapore Tianjin Eco-City centres within the Eco-City. The site is also Phase 2 comprising 110 semi-detached Keppel Corporation and Keppel Land close to the Eco-Business Park and the and 40 terrace units are all fully sold have taken up interests of 45% and commercial sub-centre which is located and completed. Phase 3, consisting of 55% respectively in a 36.6-ha site next to a planned light rail transit station. a mix of apartments, semi-detached located in the Start-Up Area of the Sino- and villa units, is expected to be Singapore Tianjin Eco-City (Eco-City). Phase 1 of the development, Seasons launched in 2011. Park, comprises 1,672 homes and Tianjin Eco-City is envisioned to be a about 40,000 sm GFA of commercial The Arcadia socially harmonious, environmentally- developments. The fi rst collection of Situated along the Outer Ring Road friendly and resource-effi cient community. eco-homes was launched at end-October in Jinnan District, The Arcadia is a Keppel Land is participating in the 2010 and sales have been encouraging. high-end villa development with good Eco-City as a member of the Singapore More than 86% of the 548 units launched accessibility to the highways. It is consortium, as well as project manager have been sold as at end-February 2011. a two-hour drive to Beijing and for the development of Keppel Group’s a 45-minute drive to TEDA. 36.6-ha site. Serenity Cove Serenity Cove is strategically located The Arcadia which comprises The development of the site will within the Sino-Singapore Tianjin 168 exclusive villas, is designed to be carried out in phases and is expected Eco-City and is poised to benefi t from cater to the local upper-income and to yield about 5,000 homes, as well as the growth and development of this expatriate communities. Educational commercial developments including landmark bilateral project. institutions such as the American offi ce and retail space with total gross International School and the Japanese fl oor area (GFA) of about 680,000 sm. Serenity Cove enjoys good accessibility School are situated nearby. as it is 10 km from the Tianjin Economic- The site is strategically located along Technological Development Area (TEDA) The development was completed in the Eco-Valley which is the ecological and about 36 km to the Tianjin Binhai 2009 and all units have been fully sold green spine linking major transit nodes, International Airport. as at end-December 2010.

ECONOMIC REVIEW The Beijing-Shanghai express railway, was less signiﬁ cant. Luxury residential Infrastructure Development which will stop at Tianjin West Station, market remained stable, bolstered by Supports Growth will shorten the trip between Tianjin strong end-user and upgrading Tianjin maintained its growth and and Shanghai to four hours, boosting demand. The average price of luxury ended the year with a total GDP its attractiveness to investors and apartments rose 16% from 2009. of RMB911 billion (US$13.7 billion), businesses within and outside Tianjin. an increase of 17.4% year-on-year. Although there was a drop in The rapid growth rate was among MARKET REVIEW transaction volume after the one of the highest recorded in major Improved Market Sentiments announcement of the measures, Chinese cities. The cooling measures announced Tianjin’s property market began to by the Tianjin municipal government stage a recovery gradually by August As the biggest and veteran industrial in 2010 included the limitation to 2010 as market sentiments improved. city in North China, Tianjin’s expansion one additional home purchase in six was largely contributed by its secondary central districts and the halt of housing The high-speed Beijing-Tianjin sector, which made up 53.1% of its loans by local commercial banks Intercity Railway which halves travelling GDP in 2010. to families buying a third or more time between the two largest cities housing units. in northern China to 30 minutes will Tianjin’s transportation network is fast continue to spur residential demand developing with three additional metro However, relative to other major cities, in Tianjin. As Tianjin’s economy lines in the ﬁ nal stages of construction the impact of Tianjin’s tightening continues to expand, so will the due for trial operation by June 2011. measures on the property market residential market.

Keppel Land Limited 74 Report to Shareholders 2010 1 2

1_Seasons Park is the ﬁ rst collection of eco-homes launched within Keppel’s 36.6-ha site in Tianjin Eco-City.

2_Phase 3 of Serenity Cove in Tianjin is expected to be launched in 2011.

Operations and Market Review Overseas – China 75 Operations and Market Review Overseas – China

CHENGDU been selling about 1,000 or more The development will be bulit over The Botanica units a year. The fi rst three phases several phases and is envisioned to The Botanica is a residential township comprising 3,494 units were handed yield about 1,630 high-rise residential located in southeast Chengdu, at the over to home buyers in 2009. apartments. Phase 1 of the development junction of Third Ring Road and Cheng is scheduled for launch in 2012. Long Road. Jointly developed by Keppel Phase 4 was launched in September Land and Surbana Land, The Botanica 2008 and all 1,028 units were sold in Villa Development in Mumashan is about a 15-minute drive from the less than a year. 2010 was a record In October 2010, Keppel Land China city centre. year and all 1,810 units in Phase 5 acquired two new sites in Mumashan which were launched in April 2010 in Xinjin County for villa development. The entire township will be developed were sold out by end-2010. over seven phases, yielding about The development will consist of 9,479 residential units and catering to Riding on strong demand, Phase 6 240 villas and sits on two land parcels Chengdu’s growing middle-income is expected be launched in 2011. with a combined land area of 25 ha. group and staff of the nearby Sichuan Normal University. Residential Development in The site is well-located and is 20 km Panchenggang southwest from Chengdu’s Third The township will comprise a mix of low- Keppel Land China acquired a prime Ring Road and 2 km from the and high-rise apartments, commercial 5.1-ha city site located along the renowned Sichuan International buildings, and supporting amenities Second Ring Road in Panchenggang, Golf Club. It is in close proximity including kindergartens, a primary school, Jinjiang District in October 2010. to the Tianfu New City, which is clubhouses, recreational facilities, parks, primed to be Chengdu’s software a market and car park facilities. Situated in a prime location with town and future central business high connectivity, the site is in close district (CBD). Since 2005, the township has sold 6,332 proximity to Dongdajie, Chengdu’s housing units over fi ve phases. With the fi nancial street, as well as to shopping Targeted at the upper-middle income exception of 2008 when the Sichuan landmarks, the metro stations and group, the project is expected to earthquake ocurred, The Botanica has renowned schools. launch its fi rst phase in 2012.

ECONOMIC REVIEW next 20 years, from its current size market since 2001. Market outlook Robust Growth of 13 million. remains promising as about 50% of Chengdu has been expanding at an the supply is absorbed by non-local average GDP growth of 12.6% annually By hosting the Western China residents moving or planning to move from 1995 to 2009. International Fair and the Annual into Chengdu city. Summit of China Green Companies, The city maintained its acceleration Chengdu has positioned itself as an Like many other cities, the series of new with a double-digit expansion of 15% international high-end conference policies issued by the government to for 2010. In tandem with economic destination city. With the Chengdu curb overheating, has dampened the growth, Chengdu’s urban disposable Exposition Bureau plans to attract overall residential market. income per capita rose by 11.7%, high-end industries and a series of reaching RMB20,835 (US$3,130) exhibitions coming up in 2011, the However, prices will continue to by the end of 2010. outlook for its economy is positive. remain buoyant if no further policies are implemented. Supported by Compared with other Chinese cities, MARKET REVIEW positive sentiments and genuine Chengdu is expecting a population Genuine Demand demand from owner-occupiers, boom. As a national experimental As the largest city in southwestern the property market is expected zone for urban-rural reform, the city is China and the provincial capital of to perform well along with China’s planning to increase its population to Sichuan Province, Chengdu has seen economic growth. between 23 and 25 million within the strong performance of its residential

Keppel Land Limited 76 Report to Shareholders 2010 Genuine demand for quality housing continues to support healthy property sales in China.

NANTONG The development enjoys frontage of the terrace houses, duplexes and high-rise Residential Development Tianxingheng River in the north and the apartments comprising mainly In December 2010, Keppel Land China Fumingang River in the east. It is also 3- and 4-bedroom units with average secured a maiden residential site of conveniently surrounded by reputable sizes ranging from 145 sm to 580 17.2-ha in Nantong. The site is well schools, hospital facilities and a newly- sm and complementary 3,000 sm located in the established town centre opened mall, Xinghu Plaza 101. commercial space. of Nantong Economic & Technological Development Area, a 10-minute drive to Targeted at the upper-income residents The ﬁ rst phase of the development Nantong’s new CBD and a 20-minute in the Jiangsu area, the 979-unit is planned for launch in 2012. drive to the old city centre. development will have a mix of villas,

ECONOMIC REVIEW reaching RMB342 billion (US$51 billion) MARKET REVIEW Spillover Effects from Shanghai in 2010. Driven by the continued strong Demand-driven Recovery and Suzhou economic growth and rising urban Sales volume in Nantong was initially Nantong has been enjoying strong disposable income per capita, income affected when the cooling measures were double-digit GDP growth averaging growth in Nantong was highest among announced in 2010. However the impact close to 15% per annum for the past the 16 cities in the Yangtze River Delta. was relatively less severe compared seven years, supported by its key with other cities, as it was supported by industries in construction, textiles Ongoing infrastructural improvements strong pent-up demand in the market. and shipbuilding. linking Nantong to Shanghai and the designation of Nantong as one In 2010, the sales volume dropped by Nantong is one of China’s top 10 textile of the economic growth pillars in 25% compared with 2009. Despite the products and garment export bases. northern Jiangsu will promote the city’s cooling measures, average selling prices Nantong Port, which is one of China’s economic integration with Shanghai in Nantong rose to RMB9,300 psm, top 10 ports and Yangtze River’s and southern Jiangsu’s afﬂ uent cities. 33.7% higher than the average price of second largest port, plays an integral RMB6,955 psm achieved in 2009. role in supporting China’s largest The opening of the Shanghai-Nanjing Shanghai Port. high-speed railway will further narrow With the completion of the Sutong Bridge the link between Shanghai and Nanjing, linking Nantong to the more developed Despite the withdrawal of the 2009 the capital of Jiangsu Province, and the southern Jiangsu region like Shanghai, economic stimulus measures, economic development of cities in the demand for housing in Nantong is Nantong’s GDP continued to grow, Yangtze River Delta region. expected to grow.

Operations and Market Review Overseas – China 77 Operations and Market Review Overseas – China

WUXI Central Park City Central Park City is a 35.3-ha township in Taihu New City in the southern part of Wuxi.

Taihu New City is fast being developed into a secondary city centre, complete with inter-city rail stations and retail, ofﬁ ce, residential and educational amenities. The municipal government has relocated their ofﬁ ces to Taihu New City since October 2010.

The entire township features a total of about 5,000 residential apartments as well as commercial and ofﬁ ce components.

All 1,448 residential units launched since September 2007 have been sold. Some 98% of the 999 residential units launched since May 2010 have been sold as at end-February 2011.

Central Park City is a township development in Taihu New City, Wuxi, and features a total of about 5,000 residential apartments.

ECONOMIC REVIEW Wuxi, Shanghai and Nanjing, travelling MARKET REVIEW Transformation in Transportation between Wuxi and Shanghai is now Positive Fundamentals Wuxi continued to achieve strong reduced to about half an hour, facilitating The property market in Wuxi fared economic performance, with GDP greater integration among the growth relatively well in 2010, supported grew by 13% to RMB575 billion cities in the Yangtze River Delta. by the growing economy and rising (US$86.5 billion) in 2010. The city urban disposable income. Despite has a strong industrial base, including Wuxi’s economy will be further the government’s cooling measures, precision engineering and electronics. enhanced when the upcoming residential sale prices rose by 27.2% 1,318-km railway connecting Beijing although volume saw a dip of 17.8% Compared to 2009, FDI increased by to Shanghai is operational. The high- to 5.2 million sm. 3.1% to RMB15.3 billion(US$3.3 billion). speed train, which links the two major Average urban disposable income economic zones, Bohai Sea Rim and The cooling measures are likely to have also rose by 11.5% to RMB27,905 Yangtze River Delta, is expected to limited impact on Wuxi’s property (US$4,196). begin operation in June 2011 with a market. Supported by strong economic stopover in Wuxi, reducing end-to-end fundamentals, the market outlook With the new rapid inter-city rail linking travel time to four hours. remains positive.

Keppel Land Limited 78 Report to Shareholders 2010 SHENYANG The Seasons Located in the Shenbei District, The Seasons is a township development which will yield a total of 4,748 units of townhouses and mid- and high-rise apartments.

It is targeted at the middle and upper- middle income families, and will feature mostly 2- and 3-bedroom apartments with unit sizes ranging from 90 sm to 140 sm. Residents will also enjoy a wide range of clubhouse facilities.

The Shenbei District is accelerating its public infrastructure and amenities development to meet the changing needs of the residents in Shenyang.

Phase 1 of The Seasons is expected to be launched in 2011.

Residential Development in Hunnan Located in the Hunnan New District, the development sits along the Hun River on a prime 30.3-ha waterfront site. Comprising a total of about 7,026 high-rise apartments, the development Targeted at the upper-middle income is supported by complementary group, the entire project will be commercial components. The township developed in phases over six to eight is a 20-minute drive from the city years. Phase 1, comprising 1,200 units, centre and a 25-minute drive from the is at the planning stage and is expected Located in the Shenbei District, The Seasons township will yield a Shenyang Taoxian International Airport. to be launched in 2012. total of 4,748 homes.

ECONOMIC REVIEW Shenyang’s prospects turned even 1.44 million sm in 2010, driven mainly National Games in 2013 to rosier after its appointment as host to by genuine end-users. beneﬁ t Shenyang the 2013 National Games. This event Propelled by expansion in the industrial will likely induce a construction boom Property developers reported a drop sector, Shenyang’s economy recorded over the next few years as Shenyang in the number of visitors to their sales a strong GDP growth of 15.7% in 2010. improves its infrastructure network. galleries after the market tightening This is expected to underpin Shenyang’s measures were announced. However, The average urban disposable growth momentum over the next Hunnan District recorded good income per capita rose to RMB20,540 few years. sales volume due to the municipal (US$3,118), an increase of 11.2% from government’s decision to relocate 2009. Housing demand from ﬁ rst-time MARKET REVIEW to the Hunnan District. home buyers and upgraders is Sustained Demand from End-Users expected to remain robust, backed Total volume transacted in Shenyang The real estate sector is envisaged to by economic and income growth. grew by 2.8% year-on-year to grow at a moderate but sustained pace.

Operations and Market Review Overseas – China 79 Operations and Market Review Overseas – China

ZHONGSHAN drive to the city centre. It has access land area will be used to develop Integrated Marina Lifestyle to six international and domestic water channels for private berthing Development airports within a 100-km radius, and an of boats, a clubhouse, a sailing Keppel Land acquired an additional established network of ferry services academy and comprehensive 66-ha of a waterfront site in Zhongshan to Hong Kong and Macau. recreational facilities. in September 2010 and the entire 86-ha site marks Keppel Land’s ﬁ rst Targeted at the upper-income waterfront residential cum marina segment, the project is expected to development in China. be launched in 2012 and will feature about 1,650 villas with private berths, Fronting the Xijiang River, the condominium units and serviced Keppel Land’s maiden project in Zhongshan is a waterfront development is about a 20-minute apartments. About 30% of the total residential cum marina development.

ECONOMIC REVIEW as well as inter-city and intra-city road housing for the entire Zhongshan Refocus on Infrastructure construction. city stood at RMB5,877 psm as at One of the “Four Little Tigers” in December 2010, an increase of 19% Guangdong, Zhongshan expanded by The municipal government is targeting year-on-year. Total area of residential 13.5% in 2010. GDP reached RMB182.6 an 11% GDP growth for 2011. Other housing sold in 2010 was 5.87 million sm, billion (US$27.2 billion) with total export targets include a 10% growth in export slightly lower than the previous year’s growing by 26.9%. trade volume, an 8% growth in per 6.33 million sm. capita disposable income for urban The Zhongshan government is residents and a 9% growth in net With the restrictive ﬁ nancial focused on infrastructure development annual income for rural residents. measures implemented, real estate in 2011, including acceleration of developers in Zhongshan have main road network construction, road MARKET REVIEW adopted attractive discount policies construction in major transport facilities Stable Demand and Prices to boost sales, and sales volume such as railways, ports and airports The average price of residential in Zhongshan city has remained stable.

Keppel Land Limited 80 Report to Shareholders 2010 JIANGYIN Stamford City Stamford City is a mixed-use development situated within the new city centre of Jiangyin. The development sits on an 8.3-ha land, with about 300,000 sm of residential, ofﬁ ce and retail space. The project is positioned as one of the upmarket residential projects in Jiangyin.

All 150 residential units and 12 shop units in Phase 1 have been fully sold. Phase 2 consists of 359 residential units with a shopping mall and 23 commercial shophouses.

Two blocks, comprising 204 residential units in Phase 2, have been fully sold and are expected to be handed over to buyers by end-2011. Another residential block of 155 units under Phase 2 is targeted for launch in 2011.

Phase 3, consisting of 818 residential units, two ofﬁ ce blocks with retail shophouses will be rolled out progressively from the fourth quarter of 2011.

Stamford City is a mixed-use development situated within the new city centre of Jiangyin.

ECONOMIC REVIEW economy underwent a transformation As the majority of buyers in Jiangyin A Wealthy Economy as the government placed heavier own more than one property, Jiangyin is an inland port city with a emphasis on developing the technology market sentiments and sales population of 1.2 million under the and services sectors. rates have moderated following jurisdiction of Wuxi, a prefecture-level the series of tightening measures city in the Jiangsu Province. Jiangyin In October 2010, the city played host imposed by the central government to grew rapidly with the industrialisation to the 19th Golden Rooster and the curb speculation in the property market. of China and is now an afﬂ uent city. Hundred Flowers Film Festival. Such Jiangyin’s economy expanded by 13.3% national events have raised global However, selling prices were higher in 2010 and disposable income per awareness of the city and opened up in 2010, averaging RMB6,674 psm, capita reached RMB30,184 (US$4,540) further investment opportunities. an increase of about 28.7% from in the urban area. a year ago. With sustained healthy MARKET REVIEW demand, Jiangyin’s property market The city’s growth is driven mainly Cautious Market Sentiments is expected to remain stable. by industrial production and its port Total volume transacted for 2010 dropped operations. In recent years, Jiangyin’s by about 6.9% compared with 2009.

Operations and Market Review Overseas – China 81 Operations and Market Review Overseas – China

KUNMING ECONOMIC REVIEW MARKET REVIEW Spring City Golf & Lake Resort Renewed Attention in Kunming Growth in Residential Prices Spring City Golf & Lake Resort Kunming’s GDP in 2010 reached Kunming recorded a growth of 28.7% (Spring City) is a world-class golf resort. RMB212 billion (US$32.2 billion), in residential prices to RMB7,121 psm, It has two championship golf courses an increase of 17.2% compared to compared with last year. Government designed by Jack Nicklaus and Robert the GDP of RMB180.9 billion efforts to raise Kunming’s profi le as Trent Jones Jr. It offers scenic mountain (US$27.5 billion) in 2009. a competitive second-tier city and and lake views with a spring-like climate a modern industrial hub connecting all year round. Located on the east In 2010, the Kunming government the mainland to its Southeast Asian shore of Lake Yang Zong Hai, it is focused mainly on the development of city neighbours have contributed to the about a 40-minute drive from infrastructures, such as new airport development of its property market. Kunming City and has easy access construction, city metro projects and to the Kunming Airport. the New Cheng Gong city development. Infrastructure development, including a new subway system, is expected Spring City continues to be a For the city infrastructure projects, the to boost the property market in popular golfi ng destination, Kunming government has embarked on Kunming. Residential prices located receiving some 60,000 golfers the construction of the subway and light near subway stations have seen sharp and visitors in 2010. In October rail, which will be linked to the new increases since September 2010 and 2010, Spring City was certifi ed Kunming airport. In addition, the Kunming are expected to soar as Kunming’s as an Audubon Classic for government will also focus on developing modernisation plans take shape. its efforts in protecting the tourism, mining and bio-pharmaceutical the environment. industries over the next few years.

Keppel Land Limited 82 Report to Shareholders 2010 Sales of resort homes at Spring City BEIJING Market Review have been good. All units at Economic Review Residential Prices Surged La Quinta Phase 1 have been fully Income Growth Outpaced Infl ation Total area of residential housing sold sold and completed. In August 2010, Beijing continues to see steady growth in Beijing fell by 36.1% to 12 million Hill Crest Residence Phase 1 in its economy as GDP reached sm in 2010. However, average prices which consists of 30 terrace houses RMB1,378 billion (US$209 billion) of new residential properties soared and 45 apartments was launched, as at the end of 2010, an increase by 42% year-on-year to RMB20,328 with more than 50 units sold of 10.2% from 2009. (US$3,023) psm. as at end-2010. The robust economic performance With growing concerns over infl ation Phase 2 of Hill Crest Residence was driven mainly by the strong growth risks, the Chinese government is which consists of a total of 228 villas, in the tertiary industry sector, including expected to adopt a tight monetary terrace houses and apartments, the wholesale and retail, commercial policy in 2011. Coupled with measures is expected to be launched in 2011. leasing, information technology and to curb prices, the property market may communications industries. remain fl at in the near term. However, real estate remains a key economic Despite concerns over soaring prices, driver in most cities as the government the city’s infl ation was kept at 2.4% continues to grow the property market for the year. The personal disposable in a sustainable and healthy manner. income of the city’s urban residents outpaced infl ation, growing by 6.2% Response to resort homes at Spring City has been positive. to RMB29,703 (US$4,414).

Operations and Market Review Overseas – China 83 The ﬁ rst phase of Riviera Point saw over 45% of 182 launched units sold as at end-February 2011. With a pipeline of about 22,000 homes in Vietnam, Keppel Land is well-poised to meet rising demand for quality housing.

Keppel Land Limited 84 Report to Shareholders 2010 Operations and Market Review Overseas – Vietnam

RESIDENTIAL Just across the 40-metre wide Ca Cam project will offer about 150 waterfront Ho Chi Minh City River, residents will enjoy easy access villas catering to afﬂ uent locals and The Estella, District 2 to amenities at the established expatriates. The development is Keppel Land’s ﬁ rst condominium Phu My Hung Township where six expected to be launched in the fourth project in Ho Chi Minh City (HCMC), international schools, an international- quarter of 2011. The Estella is conveniently located standard hospital, bank branches and near the central business district (CBD). a variety of food & beverage (F&B) Riviera Gardens, District 12 Situated on a 4.8-ha site, the project outlets are located. Riviera Gardens spans across a will be developed in three phases. 11-ha site with a prominent frontage The development is linked to the to the Saigon River. Adjacent to the The development will feature a full range township by two bridges, one of Binh Duong Province, the waterfront of facilities including a clubhouse, which is currently under construction development is accessible via a gymnasium, a 50-metre swimming and is slated to be completed in the National Road No. 1A, a six-lane pool, tennis courts and lush landscapes. second quarter of 2011. trans-Vietnam highway.

Phase 1 of The Estella which comprises The fi rst phase of Riviera Point has The development is expected to 719 apartment units was launched in been soft-launched in early 2011 with yield about 175 prime waterfront 2008. Over 470 units or 65% of the over 45% of the 182 launched units villas and is expected to be launched launched units have been sold as at sold as at end-February 2011. in 2011, targeting affl uent locals end-February 2010. These units are and expatriates. targeted for handover to buyers Riviera Cove, District 9 in late 2011. Nestled in an established residential Villa Development, Saigon South enclave, Riviera Cove comprises The project is located in an upcoming Condominium Development, 96 resort-style villas. The development residential area about 9.6 km from District 2 offers three different villa types and the CBD and is Keppel Land’s fourth Located close to the Thu Thiem New a full range of facilities which include waterfront villa development in HCMC. Urban Area, a township earmarked a riverfront promenade, a clubhouse, The 13.5-ha site will offer about 225 villas. as the new commercial district a swimming pool, a gymnasium, opposite the CBD, the development a tennis court, 24-hour security and The gated development with 24-hour will yield about 1,500 luxury waterfront full-power backup. security will feature recreational apartments. The site is accessible facilities which include a clubhouse, via Thu Thiem Bridge and has direct Offi cially launched in November 2009, a gymnasium, a swimming pool, access to the East-West Highway. over 95% of 88 launched units have a tennis court and a children’s Travelling time to the CBD will be been sold as at end-February 2011. playground. The project is expected shortened to about 10 minutes to be launched in 2012. when the Saigon Tunnel River is Villa Development, District 9 completed in 2011. Located 500 metres away from Saigon Sports City, District 2 Riviera Cove, the development Within a 20-minute drive from The high-rise development with is within a 3-km radius from the the CBD, this integrated township is supporting commercial space will Saigon High-tech Park, Rach Chiec conveniently accessible via the Hanoi create a modern living environment in Sports Complex and the Saigon Highway and upcoming HCMC – a fast-growing district of the city. The Sports City integrated development. Long Thanh – Dau Giay Expressway. development will feature facilities such The site is conveniently accessible The 64-ha site is located in An Phu as a swimming pool, a gymnasium, via the Hanoi Highway, Luong Dinh Ward, an established and popular tennis courts, 24-hour security services, Cua Street and Inner Ring Road, residential area. BBQ pits and full-power backup. which is currently under construction and is expected to be completed Targeting the upper-middle income Riviera Point, District 7 in 2012. group, the integrated township of over Located on a 8.9-ha site, Riviera Point 2,300 apartments will be developed consists of about 2,400 high-end With a 175-metre frontage to Rach as a neighbourhood sports hub. apartments with recreational facilities, Chiec River on the northern boundary The combination of international lush landscaping, 24-hour security and a 490-metre frontage to the Nhanh standard sporting facilities like an and full-power backup. Tributary on the eastern boundary, the Olympic-size swimming pool,

Operations and Market Review Overseas – Vietnam 85 Operations and Market Review Overseas – Vietnam

a tennis academy, a football fi eld, Offering residents a tranquil setting Keppel Land and Hung Phu inked a partnership to develop an auditorium and a training hall will along a 1.5-km shoreline, the project prime waterfront villas in create a healthy lifestyle environment will be developed into an integrated Ho Chi Minh City. for residents. waterfront township offering about 7,850 homes including townhouses, South Rach Chiec, District 2 villas and high-rise apartments with Located in the same vicinity as the various commercial and public facilities. Saigon Sports City, South Rach Chiec stands on a 30-ha site which COMMERCIAL Keppel Land and its local partners Ho Chi Minh City secured in exchange for building and Saigon Centre, District 1 transferring a social housing project Saigon Centre is strategically located of about 1,800 homes for the city. on Le Loi Boulevard, one of the city’s main thoroughfares. This mixed-use A waterfront integrated township development will be developed in phases. development with a combined The fi rst phase comprises a three-storey 2.7-km frontage to the 54-metre wide retail podium, 11 fl oors of offi ces and 89 Giong Ong To River and the 60-metre luxury serviced apartments which wide Muong Kinh River, South Rach have been in operation since 1996. Chiec will feature 6,430 apartments with quality retail, commercial, The development enjoys close educational and medical facilities. proximity to the HCMC People’s Committee, Ben Thanh Market and Dong Nai Province prominent hotels, making Saigon Dong Nai Waterfront City Centre the preferred commercial and Sitting on the bank of Dong Nai River, residential address in HCMC. the 367-ha site with a 2.7-km river frontage is accessible via a 45-minute drive The retail podium is a well-known from the CBD. The completion of shopping venue where a good the HCMC – Long Thanh – Dau Giay collection of international fashion Expressway in the near future will brands and home-decorating products reduce travelling time. as well as F&B outlets are housed.

Keppel Land Limited 86 Report to Shareholders 2010 In 2010, Saigon Centre remains the landmarks in HCMC including the premises in the prime commercial market leader in terms of occupancy Opera House and the Ben Thanh Market. district of Vung Tau. The 10-storey and rental rates for its offi ces, retail Grade A offi ce building is the space and serviced apartments. Hanoi preferred business address for International Centre many blue-chip companies in Phases 2 and 3 are expected to Located in the centre of Hanoi, the the oil and gas, petrochemical commence work in 2011 and will eight-storey offi ce building enjoys and fi nancial industries. include Grade A offi ces, serviced close proximity to Hanoi Opera House, apartments, as well as prime the Ministry of Trade, State Bank of HOTELS AND RESORTS retail spaces. Vietnam and Hoan Kiem Lake. Hanoi Royal Park Sedona Suites Hanoi Tamarind Park, District 1 With over 7,000 sm of Grade A offi ce Completed in 1998, Royal Park Located within the CBD, Tamarind Park space, International Centre is the Sedona Suites Hanoi is a popular is planned as a serviced apartment preferred location of multi-national accommodation choice for development which targets expatriates corporations such as Johnson & Johnson, expatriates and businessmen. who appreciate the easy access to Singapore Airlines, Citibank and Maersk. international offi ces, restaurants and a This 175-unit serviced apartment vibrant city life. Vung Tau and villa development offers PetroVietnam Towers excellent services and hospitality The development is in proximity to the In operation since 1997, PetroVietnam for residents and guests in a tranquil Dong Khoi shopping belt and various Towers offers international standard setting with lush landscaping.

IN FOCUS: Dong Devaluation to Reduce Trade Deficit

Higher imports arising from growing and unoffi cial rates as the currency and discount rates at 9% and consumer demand and investment slipped to a low of about 21,500 Dong 7% respectively. growth resulted in a persistent to one US$ on the black market trade defi cit which weighed on in late November 2010. According Investment in physical assets may the Vietnamese dong (Dong) as to the State Bank of Vietnam, the increase as the Dong devalues. importers sought US dollars for timing is appropriate as the foreign According to a report by CB Richard overseas payments. Trade defi cit exchange position of commercial Ellis (CBRE), depreciation of the reached US$12.4 billion in 2010, banks is largely positive and they are Dong will result in more people an increase from US$12.2 billion fi nancially stronger in comparison with investing in property and gold. in 2009. previous adjustments. Developers and property consultants Therefore, the Dong was devalued To curb additional infl ationary continue to see long-term growth on four occasions in 15 months pressure which arises from the potential in Vietnam’s real estate since November 2009. The latest devaluation, the State Bank of sector, supported by its growing devaluation in February 2011 was Vietnam hiked the refi nance rate, middle-class and rapid urbanisation. the most severe at 9.3% after previous which is the rate charged for short- The government has estimated that adjustments of between 2% and 5%. term loans to domestic banks, by 200 about 46 million people, equivalent The depreciation also aimed to basis points to 11% on 17 February to 47% of its population, will live in narrow the gap between the offi cial 2011, while maintaining base interest the cities by 2020.

Operations and Market Review Overseas – Vietnam 87 Operations and Market Review Overseas – Vietnam

ECONOMIC REVIEW consumption, investments and exports offi ce rents dipped slightly to US$45 Measures to Support Positive Growth is expected to translate into higher per sm per month (psm/mth) in 2010, Vietnam’s economic growth beat demand for labour which will in turn compared to US$47 psm/mth in 2009 government’s target of 6.5% as the boost wage growth. as new supply came onto the market. country expanded by 6.8% in 2010, supported by the global recovery. MARKET REVIEW With the recovery in the economy, Residential take-up of Grade A offi ce space Infl ation became a renewed concern as Steady Take-up amounted to over 20,000 sm in the it rose to 9.2% in 2010. In a bid to manage In HCMC, the affordable and mid- fourth quarter of 2010, accounting for infl ation, the main policy interest rate was end apartment markets dominated about 43% of the total net absorption raised to 9% in November 2010 from transaction activities in 2010 with more for the year. According to Jones the 8% held since December 2009. launches in these segments. High- Lang LaSalle, the majority of leasing As a result, the bank deposit and end villas enjoyed strong take-up with transactions came from new leases, loan rates increased to 14% and 18% increasing preference for homes in relocation and expansion of existing respectively in December 2010. The District 9, District 12 and Saigon South. occupiers due to greater confi dence government has also restricted loan According to CBRE, ownership on an improved economic outlook. growth to ease infl ationary pressure. aspiration for landed properties is expected to remain strong and buyers of As HCMC registered strong economic The country recorded foreign direct condominiums in District 7 are increasing. growth of about 12% in 2010 and investment (FDI) commitment of expects further expansion in 2011, US$18.6 billion for 2010, of which the To provide greater clarity on legislation offi ce demand should continue to real estate sector accounted for 36% of relating to the residential market in improve, supported by expansion of the FDI. Conversely, Offi cial Development Vietnam, the government introduced foreign corporations in the fi nance and Assistance (ODA) disbursement, another Decree 71 in August 2010. The decree insurance, real estate and offshore source of capital which plays an important made it possible for developers to sell sourcing industries. role in economic development, remained up to 20% of units through the use of steady at US$3.5 billion in 2010. For capital contribution contracts before In Hanoi, Grade A offi ce rents improved 2011, international donors pledged to the completion of foundation. It also and ended the year at US$40 psm/mth offer US$7.9 billion in ODA, refl ecting restricts the amount of loans that banks compared with US$35 psm/mth in their confi dence in Vietnam’s long-term can provide to developers, weeding 2009. Vacancy in the CBD dipped as growth potential. out fi nancially-weak developers. take-up improved alongside limited The legislation bodes well for reputable supply. Hanoi’s economy is set to Remittances also increased 25.6% developers with proven track records expand at an average rate of 12–13% year-on-year to US$8 billion in 2010, in Vietnam. from 2011 to 2015, following robust higher than the target of US$6 billion GDP growth of 11% in 2010. set earlier in the year. Offi ce Growing Optimism Retail The government is positive on the Demand for offi ce space in HCMC A Robust Sector economic outlook, targeting about 7% picked up gradually in the second half The retail market remains the most GDP growth for 2011. Strong growth in of 2010 amidst easing rents. Grade A attractive segment across the real

Vietnam

2009 2010E 2011F 2012F Real GDP growth (%) 5.3 6.8 6.9 7.1 Lending interest rate (average, %) 10.1 13.2 13.8 12.5 Inward FDI (US$ bn) 7.6 9.1 9.8 11.8 Exchange rate (Dong/US$, average) 17,800 19,127 19,595 20,012 Personal disposable income (US$ bn) 41.8 44.0 49.7 55.6 CPI change (average, %) 7.0 9.0 12.3 8.8 Source: Economist Intelligence Unit

Keppel Land Limited 88 Report to Shareholders 2010 estate sector. In HCMC and Hanoi, retail space in the CBD has been the most sought-after due to its limited supply.

The overall average rental for CBD retail space in HCMC increased 7% to US$130 psm/mth. Occupancy also remained high at over 90%. In Hanoi, the average monthly rent ranges from US$20 to US$120 psm/mth with a steady occupancy rate of 93%.

Total retail sales in Vietnam soared 24.5% to about US$80 billion in 2010 and is targeted to grow at 20–25% for the years ahead. Supported by growing afﬂ uence of its middle-class, the retail market will remain robust. Consumers are also beginning to gravitate towards established brands and international franchises, leading to high demand for shopping centres in HCMC and Hanoi.

Serviced Apartments Greater Demand As Vietnam’s economy continued its recovery, demand for serviced apartments from expatriates, returning overseas Vietnamese and wealthy local residents in both Hanoi and HCMC showed signs of improvement. Occupancy rates for Grade A serviced apartments improved to above 90% while rentals remained subdued at an average of US$34 psm/mth in 2010.

Serviced apartments remain a preferred housing option for expatriates and overseas Vietnamese as they offer a full range of services to tenants. As more multi-national corporations establish presence in Vietnam, the inﬂ ux of business travellers and expatriates will boost demand for Grade A serviced apartments.

Saigon Centre is the market leader in terms of occupancy and rental rates for its ofﬁ ces, retail space and serviced apartments.

Operations and Market Review Overseas – Vietnam 89 Operations and Market Review Overseas – India

RESIDENTIAL is almost completed and has begun City, it is a prime business location for Bangalore handover of units to homeowners. major IT companies in the West Bengal Elita Promenade area. The development enjoys direct Elita Promenade is a short drive from Elita Horizon accessibility to the international airport the central business district and is Elita Horizon is located off Kanakapura as well as Kolkata’s city centre, close to Bangalore’s IT hubs such as Road with close proximity to the which is a 30-minute drive along the Electronic City and the IT corridor lining Peripheral Ring Road. With direct Rajarhat Expressway. Bannerghatta Road and Sarjapur Road. accessibility to the major IT corridors of Electronic City and Bannerghatta With a total of 1,278 units, Elita Garden Lying in the south of Bangalore city Road, the development will offer Vista comprises 15 tower blocks centre, the development is centrally homeowners resort-like surroundings varying between 15 and 30 storeys, located in the established middle-class amid the densely populated areas of offering mainly 2- and 3-bedroom units residential enclave in JP Nagar, with south Bangalore. ranging from 1,277 sf to 1,850 sf in size. a frontage of about 250 metres to the Puttenahalli Lake. Its proximity to Targeting the upper-middle income Phase 1 consisting 688 units is 63.2% the Outer Ring Road enables easy segment, the 1,138-unit Elita Horizon completed while Phase 2 consisting accessibility via the extensive radial will have a total of 15 tower blocks of 590 units has commenced construction. road network. 20 storeys high, comprising 2- to 4- bedroom units with unit sizes ranging As at end-February 2011, about 84% With a total of 17 tower blocks of from 1,365 sf to 2,880 sf. of the 688 units launched under Phase 1 20 storeys each, the 1,573-unit have been sold. Elita Promenade comprises mainly of Kolkata 2- and 3-bedroom units ranging from Elita Garden Vista 1,350 sf to 1,790 sf in size. Elita Garden Vista, Keppel Land’s ﬁ rst project in Kolkata, is a residential As of end-February 2011, 1,515 units development in the northeastern part have been launched of which about of Greater Kolkata. Situated within the Elita Garden Vista is situated in the 95% have been sold. The development Rajarhat Township in the Salt Lake Rajarhat Township in Kolkata.

Keppel Land Limited 90 Report to Shareholders 2010 IN FOCUS: Comparing Property Markets in India and China

Compared with China, India is As part of its latest 5-year plan is seeing a decline in productive considered a late bloomer with the announced in 2011, China is set to population. On the other hand, property sector still in the early commit more than US$1 trillion to India’s young and growing workforce stages of the development cycle. promote infrastructure growth. is going to be the most important China is ahead of India in terms of driver supporting growth as favourable reforms initiated by the In contrast to China, India’s relatively structural reforms open up more central government on regulatory underdeveloped infrastructure has job opportunities. Improvements in measures overseeing corporate held back its growth and overall infrastructure facilities will further governance, transparency and development. Increased investment drive economic expansion. accounting practices. in infrastructure is one of the Indian government’s top priorities, with the Like China, India is susceptible The link between infrastructure goal of investing US$1 trillion on to near term macroeconomic development and economic growth infrastructure in 2012 – 2017 to build challenges such as inﬂ ationary is obvious as one compares China’s roads, airports and ports. pressures and increasing interest experience with India’s. From 1996 rates. However, the potential of to 2005, China devoted 8.2% of its While China’s economy is set their respective property markets GDP on infrastructure compared to to moderate towards a more remains,underpinned by strong India’s 4%. According to an Ernst & sustainable growth rate over the socio-economic factors such as Young India report, India spent 6.5% next few years, India’s economy is increasing purchasing power, an of GDP on infrastructure in 2009, expected to accelerate. China, emerging and growing middle class compared with about 11% by China. due to its one-child policy, as well as rising urbanisation.

Keppel Land is poised to meet India’s demand for quality housing.

Operations and Market Review Overseas – India 91 Operations and Market Review Overseas – India

ECONOMIC REVIEW demand has been led by projects supply of residential units moving Strong Growth Amid located in the suburbs, which were in tandem with demand. Infl ation Concerns affordably priced. India’s economy grew by 9.1% in 2010, Several new launches were released and is expected to continue to expand Since the beginning of 2010, in 2010, with the majority targeted by 9% for 2011. prices have inched upwards on at the middle- and high-income increased confi dence among segments. There is renewed The Indian economy witnessed high developers who have rolled out interest from buyers and investors. levels of infl ation in the aftermath of the several new launches aimed at Enquiries and sales have increased, global fi nancial crisis, prompting the buyers in the upper-middle and as compared to the last two years. Reserve Bank of India (RBI) to increase high-income segments. the repo rate by 1.75% to 6.5% and Revival of Demand in Kolkata the reverse repo rate by 2.25% to 5.5% In spite of rising prices, the healthy Kolkata saw a steady increase since January 2010. demand in Delhi-NCR, Bangalore, in capital values and demand Chennai, Kolkata and Pune provided in 2010. The residential market The wholesale price infl ation increased support to the overall absorption remains an owner-occupier one, from 8.56% in January 2010 to peak level in India. driven by the middle-income and at 10.55% in June before slowing to an lower-income group segments. 11-month low of 7.48% in November. To curb speculative demand, However, activity in the residential The deceleration has been mainly on RBI has taken measures such as market has been relatively account of lower food prices and a raising risk weightage on subdued in the run-up to the higher base effect. Infl ation has since housing loans beyond Rs7.5 million state elections scheduled for risen to 8.23% in January 2011. and capping the loan-to-value May 2011. ratio to 80% from 85% previously. MARKET REVIEW The residential market, especially Recovery in Residential Sector Returning Buying Interest in the high-end segment, is likely The residential sector has been in Bangalore to see strengthening of capital the fi rst to recover from the global Bangalore is the only city in the values and demand after the economic downturn. Since mid-2009, country which has witnessed the state elections.

India*

2009 2010E 2011F 2012F Real GDP growth (%) 7.7 9.1 9.0 8.7 Lending interest rate (average, %) 12.2 12.4 13.4 13.5 Inward FDI (US$ bn) 34.7 24.5 34.0 45.0 Exchange rate (Rs/US$, average) 48.41 45.72 45.13 44.45 Personal disposable income (US$ bn) 1,083 1,285 1,451 1,640 CPI change (average, %) 10.9 11.9 7.0 5.0 Interest from homebuyers has Source: Economist Intelligence Unit increased over the last two years * Figures refer to ﬁ scal year commencing 1 April of year indicated. in Bangalore.

Keppel Land Limited 92 Report to Shareholders 2010 Operations and Market Review Overseas – India 93 Operations and Market Review Overseas – Indonesia

RESIDENTIAL Retail malls, shophouses, entertainment The 18-storey Tower 1, with a gross Jakarta centres, offi ces, international schools, fl oor area of approximately 350,000 sf, Pasadenia Garden hospitals, market and other facilities is fully leased as at end-2010 on the Located within the upper-middle class will also be developed as part of the back of a healthy offi ce market. Pulomas residential area, Pasadenia gated community. Garden is a low-density condominium Surabaya development comprising 198 units. The initial phases comprise four BG Junction About 180 units have been sold and clusters of landed houses with a BG Junction is a strata-titled retail almost all remaining units have been total of 971 units, a clubhouse with complex situated within Surabaya’s leased out. various facilities, a shopping arcade CBD. Comprising six levels of retail and a fresh produce market. space and an adjoining multi-storey Jakarta Garden City car park building, BG Junction has A well-planned integrated township About 75% of the 866 units launched have three main anchor tenants, namely development designed with a green been sold as at end-February 2011. hypermart giant Carrefour, Cahaya lifestyle theme for “live, work, play and Departmental Store and entertainment learn”, Jakarta Garden City is located on COMMERCIAL centre Three Sum. a 270-ha site in Cakung, East Jakarta. Jakarta International Financial Centre The mall achieved an overall occupancy The site is one of the last few remaining International Financial Centre of 88% as at end-2010. Some 375 units large, contiguous plots of land available consists of two offi ce towers and have been sold and about 32,300 sm of for housing development within Jakarta. is strategically located along Jalan retail space has been leased. Marketing Located in close proximity to Kelapa Jenderal Sudirman in Jakarta’s efforts will continue to target at Gading, an established township, Jakarta central business district (CBD). increasing occupancy and improving Garden City is targeted at the middle- the tenancy mix. to upper-middle income families. Plans are ongoing to redevelop the 10-storey Tower 2 into a Grade A The township was named Runner-Up in offi ce tower with a gross fl oor area of the low-rise residential category at the approximately 600,000 sf. Construction FIABCI Prix d’Excellence 2010 Awards of the new offi ce tower is scheduled to in May 2010. It will be developed in commence in the second half of 2011 phases and is expected to yield about and to be completed in the second Jakarta Garden City was recognised for quality at the 7,000 landed homes and apartments. half of 2014. FIABCI Prix d’Excellence Awards.

Keppel Land Limited 94 Report to Shareholders 2010 1 2

1_International Financial Centre is strategically located in Jakarta’s CBD.

2_BG Junction in Surabaya houses a good mix of tenants and has achieved 88% occupancy.

Operations and Market Review Overseas – Indonesia 95 Operations and Market Review Overseas – Indonesia

ECONOMIC REVIEW is expected to continue in 2011 on by Tangerang, accounting for 42%, Growth to Accelerate Further Indonesia’s good growth prospects. followed by Bekasi at 27%. The Indonesian economy grew at a stronger 6.1% in 2010 compared with The total stock of offi ce space within Changes in lifestyle preferences towards 4.5% in 2009. Growth is expected Jakarta’s CBD reached 4.13 million sm high-rise living and increased disposable to accelerate further to 6–6.5% in 2011, as at end-2010 with the completion of income among the middle and upper driven by rising domestic demand and Sentral Senayan 3. A further 251,000 sm segments are also presenting developers foreign investments. of offi ce space is expected to enter the opportunities in the condominium CBD market in 2011. market. According to Cushman & Foreign direct investment surged by 52% Wakefi eld Indonesia, the average sales year-on-year to Rp148 trillion in 2010. The average occupancy rate for offi ce rate for condominiums in Jakarta was The increase has been supported by space in Jakarta’s CBD rose to 85.2% 94.8% for the fourth quarter of 2010. improvement in investment regulations by the end of 2010 from 84.3% in 2009. The market is expected to continue and better coordination between the In US dollar terms, the average gross to improve and drive demand for central government and regional rental rate grew by 7.4% to US$16.05 psm such properties. administrations. These efforts are per month in December 2010. Both expected to draw more investments occupancy levels and rental rates are Retail into the country. expected to rise further in 2011. Intense Competition The retail market in Surabaya will continue With rising infl ationary pressures from Residential to remain challenging in the foreseeable surging food prices, Indonesia’s central Demographics Support Demand future due to the oversupply of retail bank has raised its key interest rate The positive economic outlook, a space. There is a total of 16 trade centres by 0.25% to 6.75% in early February growing and affl uent middle-class or strata-titled malls with a total cumulative 2011. It is the fi rst increase since August segment as well as favourable interest retail space of 915,000 sm as at 2009. Infl ation, which rose to 6.96% in rates are expected to generate greater 31 December 2010, with the opening December 2010, continued to edge up demand for residential properties of two new shopping centres Lenmarc to 7.02% in January 2011. from end-users. and Grand City in 2010. Another leased mall under construction Ciputra World MARKET REVIEW According to Procon Indah, as of the with an area of 57,000 sm is expected to Offi ce fourth quarter of 2010, the total planned enter the market in the middle of 2011. Demand Growth to Continue area of selected residential townships Strong economic growth, improved within Greater Jakarta area increased The average occupancy rate of business confi dence and the to approximately 42,743 ha with a Surabaya’s strata-titled malls remains strengthening of the Rupiah have fuelled cumulative supply of 357,391 units. under 70%. This is well below that of demand for offi ce space. According The cumulative sales rate of the Greater leased malls which have an average to Cushman and Wakefi eld Indonesia, Jakarta residential estates increased occupancy of over 90%. The stiff 2010 saw strong net take-up of CBD slightly to 84%. The take-up rate was competition in strata-titled malls offi ce space of 203,900 sm, an increase about 793 units per month by the end will continue to impact rentals of about 86% from 2009. Demand of 2010. New supply is still dominated and occupancy.

Indonesia

2009 2010E 2011F 2012F Real GDP growth (%) 4.5 6.1 6.2 6.4 Lending interest rate (average, %) 14.5 13.3 14.2 14.8 Inward FDI (US$ bn) 4.9 12.6 10.0 11.2 Exchange rate (Rupiah/US$, average) 10,390 9,088 8,927 8,965 Personal disposable income (US$ bn) 194.6 255.8 284.5 307.0 CPI change (average, %) 4.8 5.1 7.3 6.1 Sources: Economist Intelligence Unit and Central Statistics Agency

Keppel Land Limited 96 Report to Shareholders 2010 Operations and Market Review Overseas – Saudi Arabia

RESIDENTIAL Jeddah Al Mada Towers Developed by Keppel Land and the Saudi Economic and Development Company, Al Mada Towers is a luxury residential development located on a 3.6-ha site along the Corniche in Jeddah. The landmark 350-metre twin towers will comprise 1,005 waterfront apartments with panoramic views of the Red Sea for the majority of the units.

With convenient access to main roads, the development is just a 15-minute drive from the King Abdulaziz International Airport and a 10-minute drive from the luxury retail belt at Tahlia Street.

The sales gallery and show unit are expected to be ready by the middle of 2011 to coincide with the planned sales Residents at the landmark Al Mada Towers will enjoy launch, subject to market conditions. panoramic views of the Red Sea.

ECONOMIC REVIEW benefi ts include funding to offset high volumes have increased gradually due Accelerating Economic Growth infl ation, help the young unemployed to the constraint in housing supply. The Saudi economy expanded by 3.8% and allow families to buy or build homes in 2010 and is expected to grow further with interest-free loans. The rapid growth in Saudi’s population, by 4.5% in 2011 on strong crude oil a fast-expanding expatriate community prices, improving business confi dence MARKET REVIEW and the low home ownership rate and continued government spending, Cautious Rise in Property Prices amongst its large population are the main particularly in infrastructure investment. Saudi Arabia’s residential market has been drivers of sustained demand for housing. one of the least affected by the global The Saudi government’s projected economic crisis as a result of the Between 2004 and 2010, Saudi’s spending of SR1.4 trillion over the kingdom’s conservative and tight banking population increased by 19%, while next fi ve years is expected to attract control as well as its minimal exposure growth in the number of expatriates investors, create more jobs, fuel to the European market. The post-crisis was even stronger at 38%. Population economic activities and diversify the period has witnessed a cautious growth and a declining household economy beyond its reliance on oil exports. upward movement in property prices. size have contributed to a signifi cant Residential demand and transaction housing shortage across the kingdom. Rising food prices could push up infl ation in 2011. Saudi’s infl ation Saudi Arabia rate has risen from 4.1% in January

2010 to 6.1% in August but has since moderated to 5.3% in January 2011. 2009 2010E 2011F 2012F Real GDP growth (%) 0.2 3.8 4.5 4.2 In the wake of the uncertainty in the Lending rate (average, %) 6.6 6.5 6.8 6.9 Middle East after the governments in Egypt Inward FDI (US$ bn) 35.5 37.3 39.2 40.7 and Tunisia fell due to populist revolt, Exchange rate (Saudi Riyal/US$, average) 3.75 3.75 3.75 3.75 the Saudi King has recently announced Personal disposable income (US$ bn) 144.0 155.1 169.9 184.0 a series of beneﬁ ts for Saudis estimated CPI change (average, %) 5.1 5.4 7.9 3.9 to be worth about SR135 billion. These Sources: Economist Intelligence Unit and Saudi Arabian Monetary Agency

Operations and Market Review Overseas – Saudi Arabia 97 Operations and Market Review Overseas – The Philippines

Keppel Land, through 51%-owned 86% or 715 units have been sold The Podium also has a wide selection Keppel Philippines Properties, has two as at end-February 2010. of fi ne restaurants and service outlets. development projects in Metro Manila – Together with fi rst-class amenities, Palmdale Heights and SM-KL Towers. The third and fourth phases will the lifestyle mall provides visitors house eight residential blocks with enhanced shopping and RESIDENTIAL with 1,264 units, delivered with dining experiences. Pasig City quality enhancements, blending Palmdale Heights comfort and affordability. It will The Podium continues to be the preferred Palmdale Heights is a middle-income be launched when market venue for holding events and festive residential development located on conditions improve. celebrations. With two state-of-the-art a 7.6-ha site in Pasig City, with easy cinemas, it has also become an exciting access to the central business district COMMERCIAL hub of entertainment and leisure. (CBD) in Makati and Ortigas. Mandaluyong City SM-KL Towers The six-storey Benguet Centre is being The phased development will comprise SM-KL Towers is a mixed-use demolished in preparation for Phase 2 29 residential blocks with a total of development strategically located of the commercial component, which will over 4,000 condominium units when on a 2-ha site in the Ortigas CBD. entail an expansion of the basement completed. With elegantly designed carpark and the retail mall. living spaces, quality fi ttings and Phase 1 of the retail component, fi nishes, as well as carefully planned The Podium, is a popular shopping Plans for an offi ce tower and a amenities, it offers homeowners a destination. With over 18,000 sm residential block to be constructed above self-contained environment amidst of leasable space, it features a the retail mall are currently under review. tranquil surroundings. good mix of 150 specialty stores of well-known international and The fi rst two phases with a total of local labels, and offers a wide The Podium continues to be the preferred retail destination 828 units have been completed and choice of quality merchandise. in Ortigas.

Keppel Land Limited 98 Report to Shareholders 2010 ECONOMIC REVIEW for studio and 1-bedroom units that Rental rates of premium-grade offi ce Robust Growth target young professionals and start-up buildings in Makati declined by 2.3% The Philippine economy achieved GDP families while demand for expatriate from the beginning of 2010 to P800 growth of 7.3% in 2010, the strongest quality 2-bedroom and 3-bedroom units psm/mth. With growing demand from since 1976. Economic expansion is remained strong. the business process outsourcing fuelled by the industry and services industry and limited new supply, rents sectors, and steady remittances from Rents of luxury units in Makati and in Makati CBD are expected to increase Overseas Filipino Workers. Filipinos Ortigas were largely unchanged from by 10–15% in 2011. working overseas remitted home the previous year at an average of US$18.8 billion in 2010, 8.2% higher P550 psm per month (psm/mth) and Meanwhile, Grade A rents in Ortigas than 2009 levels. P340 psm/mth respectively. rose to P550 psm/mth in 2010. Capital values in Makati and Ortigas The Philippine government is expecting Capital values in Makati rose 2.5% rose about 2% to P101,000 psm and another year of robust growth with a year-on-year to P102,000 psm, while P55,000 psm respectively in 2010, target GDP growth of 7–7.4% for 2011. capital values in Ortigas increased and are expected to increase by 2% to P58,000 psm. marginally in 2011. Infl ation remained manageable, averaging 3.8% in 2010 compared to 3.2% in 2009. Offi ce Retail The government, which targets infl ation BPO Sector to Boost Demand Prospects for Rental Growth of 3–5% for 2011, will closely monitor The supply of offi ce space in Makati and Supply of retail space in Metro Manila the infl ation trend. Ortigas CBDs remained relatively stable increased slightly to 5.1 million sm. at 2.7 million sm and 1.1 million sm Current trend saw mall developers The central bank has maintained interest respectively as at the end of 2010. expand through development of rates at the current low levels of 4% small-scale community malls as well for overnight borrowing and 6% for There is no new offi ce development in as retrofi tting and expansion of overnight lending since July 2009 to the pipeline in Makati except for a existing malls. support credit growth. prime building with 65,000 sm of offi ce space due to be completed in 2012. Average occupancy rate remained MARKET REVIEW In Ortigas, about 28,000 sm of offi ce stable at 91.7%, a slight improvement Residential space will be completed over the from 90.8% at the beginning of the year. Steady Demand next three years. In 2010, a total of 1,100 and 760 residential Effective rental rates in Makati units were completed in Makati and Makati’s overall offi ce occupancy rate remained at P1,120 psm/mth while Ortigas respectively. This brought the increased to 94.5% as at end-2010. rates in Ortigas stood P1,035 psm/mth. supply of condominiums in Makati and However, occupancy rates of premium As consumer sentiments continue Ortigas CBDs to 13,100 units and 7,500 and Grade A buildings declined due to to improve, strong retail sales are units respectively as at end-2010. alternative offi ce locations in Rockwell expected, which will likely push up and Fort Bonifacio. Ortigas also occupancy and effective rental rates Occupancy rate in Makati dipped slightly recorded higher occupancy rate by between 3% and 5% in the to 91.2%. There was a decline in demand of 96.8% in 2010. fi rst half of 2011.

The Philippines

2009 2010E 2011F 2012F Real GDP growth (%) 1.1 7.3 5.4 5.7 Lending rate (average, %) 8.6 7.9 8.2 8.5 Inward FDI (US$ bn) 1.9 2.0 2.1 2.4 Exchange rate (P/US$, average) 47.7 45.1 44.0 43.5 Personal disposable income (US$ bn) 128.3 148.4 158.8 167.0 CPI change (average, %) 3.2 3.8 4.9 4.4 Sources: Economist Intelligence Unit and Bangko Sentral ng Pilipinas

Operations and Market Review Overseas – The Philippines 99 Operations and Market Review Overseas – Thailand

Keppel Thai Properties, which is Villa Arcadia at Watcharapol 45%-owned by Keppel Land, is Keppel Land’s second villa developing two suburban housing development in Bangkok, Villa Arcadia projects in Bangkok under the at Watcharapol is located on a 12.5-ha Villa Arcadia brand. site at Watcharapol Road, about 25 km north of Bangkok city. RESIDENTIAL Bangkok Featuring a contemporary tropical Villa Arcadia at Srinakarin design concept, the development Villa Arcadia at Srinakarin is located offers 270 luxuriously appointed on a 16-ha site at Srinakarin Road, villas in a fully gated community. about 20 km southeast of Bangkok. The villa development comprises The initial phase of 45 units built along 367 detached houses in a gated the main boulevard has been 47% sold community which offers 24-hour as at end-February 2011. security, underground power and a full facility clubhouse with pool and ﬁ tness rooms.

Phase 1, comprising 211 units, is 78% sold as at end-February 2011 while the Phase 1 of Villa Arcadia at Srinakarin is 78% sold as launch of Phase 2 is being planned. at end-February 2010.

ECONOMIC REVIEW Economic growth for 2011 is expected encourage continuous growth Resilient Economy to slow to 3.5–4.5%, in line with a more in the residential property market Despite the political unrest in May and moderated outlook as the Thai baht although rising interest rates and the heavy fl oods in October, the Thai and other regional currencies continue tighter restrictions on mortgage economy grew by 7.8% in 2010. to strengthen. The Bank of Thailand is loans may weigh on the market Economic expansion was driven mainly targeting infl ation of 2.5–3.5%. Export in the short term. by strong export growth and higher growth is expected to remain healthy private consumption. at 11.7% while consumption and private On landed housing, the supply of investment should also continue to detached houses is expected to With infl ation edging up to 3% in recover well. increase in 2011 following a 39% December 2010, the Bank of Thailand rise in the issue of land allocation has tightened monetary supply by MARKET REVIEW permits for 2010. increasing the policy rate to 2.25% in Supporting Economic Fundamentals January 2011, the fourth increase over Economic growth, near full employment six months, to further contain infl ation. and rising household incomes will

Thailand

2009 2010E 2011F 2012F Real GDP growth (%) (2.3) 7.8 4.3 5.0 Prime rate (average, %) 6.0 6.1 6.7 7.0 Inward FDI (US$ bn) 5.0 8.3 9.2 9.8 Exchange rate (Baht/US$, average) 34.29 31.69 30.04 29.75 Personal disposable income (US$ bn) 131.3 149.1 165.3 176.2 CPI change (average, %) (0.9) 3.3 3.0 2.9 Source: Economist Intelligence Unit

Keppel Land Limited 100 Report to Shareholders 2010 Operations and Market Review Overseas – Malaysia

RESIDENTIAL The Education Hub in Sutera Utama Johor consists of several well-known public Taman Sutera and and private educational institutions with Taman Sutera Utama the aim to provide lifelong learning and With over 12,000 units of residential and education advancement in the community. commercial properties spanning over 487 ha, Taman Sutera and Taman Sutera The Sutera Utama Commercial Centre Utama are part of an integrated township comprises 288 units of three-storey located close to the city centre of shop offi ces and Sutera Mall with a Johor Bahru. As at end-2010, 90% of total gross fl oor area of 677,000 sf. the 2,884 launched units comprising With Carrefour and Pekin Restaurant terraced houses, semi-detached as anchor tenants, the mall is almost houses, apartments and shop offi ces fully occupied with more than 200 have been sold. businesses spread over 353,000 sf of net lettable area. Sutera Mall’s growing Various social activities were organised popularity in the Skudai region has also throughout the year to strengthen bonding translated into positive take-up of shop among residents and to encourage offi ces located within its vicinity. community living. This is further enhanced through the Go Green programme which Taman Sutera and Taman Sutera seeks to maintain a healthy environment Utama are part of an integrated township with over 12,000 units of and improve living standards. residential and commercial properties.

ECONOMIC REVIEW MARKET REVIEW The settlement of the long-standing Public Spending to Stimulate Growth MRT System to Enhance Malaysian railway issue between Malaysia’s economy grew 7.2% in 2010, Property Values Singapore and Malaysia will beneﬁ t the signifying a strong rebound from a With increased buying interest and Johor property market. Demand for contraction of 1.7% in 2009. Growth pent-up demand, residential properties homes from foreign buyers, especially was driven by expansion in domestic in Johor Bahru achieved good take-up from Singapore investors, is expected demand amid export headwinds which in 2010. to increase on improved connectivity led to slower growth in external demand. between the two countries with the However, the property market eased proposed building of a mass rapid Economic growth is expected to ease slightly towards the later part of the year transit (MRT) system between Johor to 6% in 2011 on structural weakness as Bank Negara raised interest rates Bahru and Singapore by 2018. in exports while domestic-led private and lowered the loan-to-value limit on consumption will remain an important housing loans from a maximum of 90% The implementation of the MRT system growth driver. to 70% for the purchase of third homes is expected to boost property values in to curb speculation. Johor Bahru. The implementation of key projects under the Economic Transformation Plan, which aims to propel the country into a high- Malaysia income nation by 2020, will help to boost economic growth in the longer term. 2009 2010E 2011F 2012F Key projects identiﬁ ed include urban Real GDP growth (%) (1.7) 7.2 6.0 5.0 redevelopment and rail transportation. Prime rate (average, %) 4.8 5.1 5.6 6.0 Inward FDI (US$ bn) 1.4 2.8 5.5 6.9 Exchange rate (RM/US$, average) 3.52 3.22 3.03 2.98 Personal disposable income (US$ bn) 92.0 109.1 123.1 131.6 CPI change (average, %) 0.6 1.7 3.1 3.3 Sources: Economist Intelligence Unit and Department of Statistics, Malaysia

Operations and Market Review Overseas – Malaysia 101 Regional Network Asia Pacific and Middle East

Residential/Ofﬁ ce/Mixed Development Hotels/Serviced Apartments Australia Vietnam – 77 King Street, Sydney+ – Sedona Suites, Hanoi – 275 George Street, Brisbane+ – Sedona Suites, HCMC – Tamarind Park, HCMC China – Park Avenue Precinct, Shanghai Indonesia Shenyang – The Springdale, Shanghai – Club Med Ria Bintan – Ofﬁ ce Units, Shanghai – Hotel Sedona Manado Beijing – Seasons Park, Tianjin Eco-City – Melia Purosani Hotel, Yogyakarta Tianjin – Serenity Cove, Tianjin – Mixed Developments, Tianjin Myanmar SOUTH JAPAN – Tianjin Pearl Beach International – Sedona Hotel Yangon KOREA Country Club, Tianjin – Sedona Hotel Mandalay – The Botanica, Chengdu – Residential Development, Chengdu Resorts Jiangyin Nantong – Villa Development, Chengdu China CHINA Wuxi Shanghai – The Seasons, Shenyang – Spring City Golf & Lake Resort, Chengdu – Waterfront Residential Township, Kunming Shenyang – Central Park City, Wuxi Indonesia – Residential Development, Nantong – Ria Bintan Kunming – Integrated Marina Lifestyle Development, – Nongsa Point Marina and Resort, Zhongshan Batam Zhongshan Kolkata – Stamford City, Jiangyin – Tanah Lot Resort, Bali HONG KONG Jeddah MYANMAR – Jiangyin Yangtze International Country INDIA Hanoi Mandalay Club, Jiangyin SAUDI ARABIA + Assets owned by K-REIT Asia Vietnam in which the Group has Yangon THAILAND – The Estella, HCMC a 46.2% stake VIETNAM – Condominium Development, HCMC * Assets owned by Keppel Philippines Bangkok Manila Properties Inc in which the – Villa Development, HCMC Bangalore Dong Nai PHILIPPINES – Saigon Sports City, HCMC Group has a 51% stake ** Assets owned by Keppel Thai Ho Chi Minh City Cebu – South Rach Chiec Township, HCMC Vung Tau Properties Co in which the – Riviera Point, HCMC Group has a 45.5% stake – Riviera Cove, HCMC – Riviera Gardens, HCMC – Villa Development, Saigon South, HCMC MALAYSIA – Dong Nai Waterfront City, Dong Nai – International Centre, Hanoi Johor Bahru Manado – Saigon Centre, HCMC SINGAPORE – PetroVietnam Towers, Vung Tau Batam Bintan

India – Elita Promenade, Bangalore INDONESIA – Elita Horizon, Bangalore Jakarta – Elita Garden Vista, Kolkata Surabaya Yogyakarta Bali Indonesia – Jakarta Garden City, Jakarta – Pasadenia Garden, Jakarta – International Financial Centre, Jakarta – BG Junction, Surabaya – Galleria Tunjungan, Surabaya

Saudi Arabia – Al Mada Towers, Jeddah

Malaysia – Taman Sutera and Taman Sutera Utama, Johor AUSTRALIA Philippines* – Palmdale Heights, Metro Manila Brisbane – SM-KL Towers, Metro Manila – Site in Cebu – Sampaguita Ville, Cebu

Thailand** Sydney – Villa Arcadia at Srinakarin, Bangkok – Villa Arcadia at Watcharapol, Bangkok – Sukhaphiban 3 Mansion, Bangkok – Jewellery Centre, Bangkok

Keppel Land Limited Regional Network 102 Report to Shareholders 2010 Asia Paciﬁ c and Middle East 103 Regional Network Singapore

Offi ce 1. Ocean Financial Centre 2. Ocean Towers 3. Equity Plaza 4. The HarbourFront Offi ce Park 5. Prudential Tower+ 6. Keppel Towers and GE Tower^ 7. Bugis Junction Towers+ 8. One Raffl es Quay+

Residential 9. Nassim Woods 10. Madison Residences 11. Keppel Bay Precinct* 12. The Promont 13. The Lakefront Residences

Mixed Development 14. Marina Bay Financial Centre – Phase 1+ – Phase 2 – Marina Bay Residences – Marina Bay Suites 15. Joo Chiat Shophouses

Industrial 16. Quartz Industrial Building 17. Orion Industrial Building 18 Data Centre 18. Keppel Digihub

Expressway Mass Rapid Transit Lines

+ Assets owned by K-REIT Asia in which the Group has a 46.2% stake 13 ^ To be redeveloped into high-rise city homes 16 * Includes Caribbean at Keppel Bay, 17 Reﬂ ections at Keppel Bay, Marina at Keppel Bay and 10 Keppel Bay Plots 3, 4 and 6 15

7 12 9 1 2 3 5 8 14 6

11 4

Keppel Land Limited Regional Network 104 Report to Shareholders 2010 Singapore 105 Financial Review

2010 2009 % Increase/ $’000 $’000 (Decrease) Sales 792,273 923,869 (14.2)

Pre-tax proﬁ t before fair value gain/(loss) on investment properties/impairment 757,333 370,541 104.4

Pre-tax proﬁ t after fair value gain/(loss) on investment properties/impairment 1,183,143 358,564 230.0

Net proﬁ t 1,045,831 280,416 273.0

Total equity (including non-controlling interests) 4,640,322 3,788,602 22.5

Net debt 927,415 834,012 11.2

% Increase/ 2010 2009 (Decrease) Net debt-equity ratio (times) 0.20 0.22 (9.1)

Earnings per share (cents) After taxation but before fair value gain/(loss) on investment properties/impairment 44.6 22.6 97.3 After taxation and fair value gain/(loss) on investment properties/impairment 72.8 24.2 200.8

Return on shareholders’ equity (%) After taxation but before fair value gain/(loss) on investment properties/impairment 18.4 9.4 95.7 After taxation and fair value gain/(loss) on investment properties/impairment 30.0 10.1 197.0

Gross dividend per share (cents) Proposed ﬁ nal dividend 9.0 8.0 12.5 Proposed special dividend 9.0 – n.m.

Net tangible assets per share ($) 2.97 2.36 25.8 n.m. – not meaningful

SALES respectively, coupled with improved Sales from the Group’s overseas The Group’s sales for 2010 of residential sales from existing projects operations constituted 78.2% of the $792.3 million were $131.6 million or in China, Vietnam and Indonesia. Group’s total sales compared with 14.2% lower compared with 2009, The residential sales in China remained 51.1% in 2009. China was the main due to lower sales from property trading strong despite measures taken by the contributor, followed by Vietnam. segment as a result of lower residential Chinese government to cool the markets sales in Singapore as several projects in fast-growing cities. EARNINGS were completed and fully sold by The Group’s pre-tax proﬁ t of $1.18 billion end-2009. Overseas residential sales, The Group’s lower sales were also increased by more than two fold as however, increased due largely to new due to lower rental income from the compared with $358.6 million reported revenue streams from The Springdale Group’s investment properties in 2009. The Group’s strong performance in Shanghai and Seasons Park at as well as lower project management for 2010 was boosted by a corporate Tianjin Eco-City, which were launched fees earned, partly mitigated by higher restructuring surplus of $363.8 million in June 2010 and October 2010 fund management fees earned. arising from the disposal of the Group’s

Keppel Land Limited 106 Report to Shareholders 2010 projects in China and Vietnam, as well Group Sales ($ million) as higher acquisition and management fees earned by the fund management segment. In addition, higher dividend 948.0 1,407.9 842.2 923.9 792.3 income was received from the Group’s 1,500 equity investments in 2010. These were, however, partly reduced by the absence 1,000 of contributions from several trading projects completed during the last ﬁ nancial year, lower rental yields from 500 the Group’s investment properties, as well as lower project management 0 fees earned. 2006 2007 2008 2009 2010 Consequently, the Group closed the year with a record net proﬁ t of $1.05 billion, Group Profit an increase of $765.4 million or 273% ($ million) from $280.4 million reported in 2009.

Pre-tax profit after Earnings from overseas (excluding the fair value gain/(loss) corporate restructuring surplus, net fair on investment properties/ value gain on investment properties/ impairment 263.4 988.7 314.0 358.6 1,183.1 impairment and gain on the acquisition Net profit 200.3 779.7 227.7 280.4 1,045.8 of an additional interest in K-REIT Asia) represented about 41.1% of the Group’s 1,200 net proﬁ t compared with 31.4% for 2009.

800 RETURNS TO SHAREHOLDERS Earnings per share for 2010 (before and 400 after net fair value gain on investment properties/impairment) were 44.6 cents and 72.8 cents, respectively. These 0 were higher than the earnings per share 2006 2007 2008 2009 2010 (before and after net fair value gain on investment properties/impairment) for 2009 of 22.6 cents and 24.2 cents respectively as a result of the Group’s improved performance. one-third interest in Marina Bay $442.7 million. Excluding the corporate The Directors have recommended that Financial Centre (“MBFC”) Phase 1 restructuring surplus, net fair value gain a fi nal dividend of 18 cents per share, to K-REIT Asia as part of an asset on investment properties/impairment comprising an ordinary dividend of swap arrangement between the and gain arising from the acquisition of 9 cents per share and a special dividend Group and K-REIT Asia. Under this an additional interest in K-REIT Asia, the of 9 cents per share, amounting to about arrangement, the Group disposed of Group’s pre-tax profi t of $390.8 million $261 million, subject to the shareholders’ MBFC Phase 1 at a consideration of exceeded 2009 by $31.4 million or 8.7%. approval at the forthcoming Annual $1,399 million and at the same time, The increase was attributable largely General Meeting of the Company, be paid acquired Keppel Towers and GE Tower to the improved performance from the for the year ended 31 December 2010. from K-REIT Asia at a consideration Group’s associated companies, mainly The Dividend Reinvestment Scheme will of $573 million. Refl ections and Caribbean at Keppel Bay, be applicable to this fi nal dividend. Marina Bay Suites and K-REIT Asia. The In addition, the Group recorded a net fair improvement was also contributed by For the year ended 31 December value gain on investment properties of higher profi ts from several residential 2009, a fi nal dividend of 8 cents per

Financial Review 107 Financial Review

share amounting to $114.4 million was Earnings and Dividend Per Share (cents) paid in June 2010, satisﬁ ed by way of a cash payment of $44.3 million and issuance of 19,304,976 ordinary shares Earnings per share after taxation at an issue price of $3.63 per share but before fair value gain/(loss) on investment properties/impairment 23.6 50.7 22.1 22.6 44.6 amounting to $70.1 million. Earnings per share after taxation and fair value gain/(loss) on investment properties/impairment 19.8 76.9 22.4 24.2 72.8 FINANCIAL CONDITION Shareholders’ equity comprising Total gross dividend per share 50.0 20.0 8.0 8.0 18.0 share capital and reserves increased 80 by $925.5 million to $4.3 billion due largely to the proﬁ ts retained for the 40 year, partly reduced by the payment of cash dividend and a decrease in foreign 0 currency translation reserves arising from the weakening of the United States 2006 2007 2008 2009 2010 dollar, the renminbi and the Indonesian The earnings per share for 2006 to 2008 have been restated to include the effects of the Company’s rights issue in 2009. rupiah. As a result, the Group’s net tangible asset per share increased from Return on Shareholders’ Equity $2.36 at end-2009 to $2.97 at end-2010. (%) Non-controlling interests decreased by $73.7 million to $339.1 million at Return after taxation but before fair value gain/(loss) on end-2010, following the acquisition of investment properties/impairment 15.2 30.5 9.7 9.4 18.4 additional interests in two subsidiaries Return after taxation and fair value gain/(loss) on investment from the non-controlling shareholders. properties/impairment 12.8 46.2 9.9 10.1 30.0 50 Despite the increase in the Group’s net debt, the Group’s net debt-equity ratio decreased to 0.20 at end-2010 25 from 0.22 at end-2009 due largely to the increase in shareholders’ equity. 0 The increase in the Group’s net debt by 2006 2007 2008 2009 2010 $93.4 million was due to the utilisation of rights issue proceeds and external Dividend Payout funding for projects’ requirements, partly offset by the net proceeds of $826 million received from the asset Proposed final dividend ($ million) 43.2 57.7 57.7 114.4 130.5 swap arrangement in December 2010. Distribution in specie/ proposed special dividend ($ million) 262.9 86.5 – – 130.5 Assets employed at end-2010

Total gross dividend per share (cents) 50.0 20.0 8.0 8.0 18.0 were $7.16 billion, compared with $5.52 billion at end-2009. The increase $ million cents arose from the increase in properties 300 60 held for sale of $973.4 million as a result of land acquisition and development 200 40 expenditure incurred. There was also an increase in cash and cash equivalents 100 20 of $696.3 million to $1.59 billion at end-2010 following the receipt of net proceeds of $826 million from the 0 0 asset swap arrangement as 2006 2007 2008 2009 2010 mentioned above.

Keppel Land Limited 108 Report to Shareholders 2010 FIVE-YEAR FINANCIAL Sources of Finance ($ million) PERFORMANCE The Group’s profi ts showed consistent improvements from 2006 to 2010, Shareholders’ equity 1,590.9 2,291.2 2,442.6 3,375.8 4,301.3 with the highest net profi t achieved in Non-controlling interests 310.0 352.5 454.4 412.8 339.0 2010. Despite the highest net profi t, Long-term borrowings 2,111.1 1,955.9 1,937.8 903.6 2,199.7 the earnings per share and return on

Short-term borrowings 439.7 318.9 184.0 823.1 316.8 shareholders’ equity for 2010 were lower than those for 2007 due primarily Total 4,451.7 4,918.5 5,018.8 5,515.3 7,156.8 to the enlarged share capital following 9,000 the Company’s rights issue in 2009.

6,000 The second highest net profi t was achieved in 2007 when the Group recorded a fair value gain of 3,000 $457.1 million on its investment properties for the fi rst time upon its 0 adoption of FRS 40 Investment Property. 2006 2007 2008 2009 2010 The results in 2007 were also boosted by the one-off gain of $235.2 million from the restructuring of ownership in Assets Employed ($ million) One Raffl es Quay. However, these gains were partly offset by a total impairment of $78.5 million for the Group’s hotels in Fixed assets and investment properties 1,486.7 1,603.5 1,680.2 1,632.8 1,906.4 Yangon and Mandalay and diminution in Investments 659.4 722.4 1,020.4 1,500.3 1,531.2 value in rupiah pertaining to the Group’s Non-current assets 753.2 737.2 813.8 940.7 446.2 prior years’ investments in Indonesia.

Net current assets and deferred taxation 1,552.4 1,855.4 1,504.4 1,441.5 3,273.0 The ﬁ nal proposed dividends in the past Total 4,451.7 4,918.5 5,018.8 5,515.3 7,156.8 ﬁ ve years were in line with the Group’s 9,000 performance in these years. In 2006, in conjunction with the listing of 6,000 K-REIT Asia, a special distribution in specie of 144.4 million units in K-REIT Asia, representing 44 cents 3,000 per share, was made, bringing the total dividend for that year to 50 cents 0 per share. In 2007, in view of the sterling 2006 2007 2008 2009 2010 performance as mentioned above, a special dividend of 12 cents per share and an ordinary dividend of 8 cents per Net Tangible Assets Per Share ($) share, were distributed. Similarly, for 2010, the Directors proposed a special dividend of 9 cents per share to be 2.21 3.18 3.39 2.36 2.97 made in addition to the ordinary 4 dividend of 9 cents per share.

Net tangible assets per share increased 2 from $2.21 at end-2006 to $3.39 at end-2008. The net tangible assets per 0 share at end-2009 and end-2010 were 2006 2007 2008 2009 2010 lower than those of earlier years as a result of the enlarged share capital

Financial Review 109 Financial Review

Analysis By Business Segment

Sales Ebita Pre-tax Proﬁ t Net Proﬁ t Assets Employed 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Property trading 579,583 720,774 133,376 141,494 276,598 286,876 208,119 196,415 3,759,743 2,989,428 Property investment 70,200 75,361 47,843 50,106 78,015 63,941 55,195 43,324 2,365,876 2,156,304 Fund management 68,723 42,749 49,554 24,022 51,034 25,770 39,890 21,498 100,297 92,614 Hotels and resorts, property services, and others 73,767 84,985 1,161 (4,243) (14,840) (17,148) (28,973) (11,024) 930,867 276,979

Sub-total 792,273 923,869 231,934 211,379 390,807 359,439 274,231 250,213 7,156,783 5,515,325 Corporate restructuring surplus – – – – 363,848 – 363,848 – – – Fair value gain/(loss) on investment properties/ impairment – – – – 425,810 (11,977) 405,074 19,101 – – Gain on acquisition of additional interest in an associated company – – – – 2,678 11,102 2,678 11,102 – –

Total 792,273 923,869 231,934 211,379 1,183,143 358,564 1,045,831 280,416 7,156,783 5,515,325

Analysis By Geographical Location

Sales Ebita Pre-tax Proﬁ t Net Proﬁ t Assets Employed 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Singapore 172,387 452,094 86,878 115,920 215,467 238,171 161,624 171,552 4,547,743 3,600,905 Others 619,886 471,775 145,056 95,459 175,340 121,268 112,607 78,661 2,609,040 1,914,420

Total 792,273 923,869 231,934 211,379 1,183,143 358,564 1,045,831 280,416 7,156,783 5,515,325

Keppel Land Limited 110 Report to Shareholders 2010 following the Company’s rights issue that of last year because of lower rental stake in 77 King Street in Sydney as in 2009. yields from Ocean Towers and Equity well as the one-third interest in MBFC Plaza in Singapore, and Saigon Centre Phase 1. Alpha also earned acquisition PROPERTY TRADING in HCMC. This decline was, however, fees of $9.8 million from acquisitions in Sales from property trading of partly mitigated by the higher rental Singapore and overseas made by $579.6 million for 2010 were $141.2 million income from International Financial a fund it managed. or 19.6% lower than $720.8 million Centre in Jakarta. reported in 2009. The decrease was Net profi t for 2010 increased on account due mainly to the completion of The Net profi ts recorded for 2010 included of higher revenue and a fair value gain Suites at Central and The Sixth Avenue a corporate restructuring surplus of from a forward currency contract. Residences in Singapore during the $363.8 million arising from the disposal last fi nancial year. These two projects, of the Group’s one-third interest in Assets employed increased marginally together with the remaining units of MBFC Phase 1 as part of the asset swap from $92.6 million at end-2009 to Park Infi nia at Wee Nam and The Tresor arrangement, as well as a net fair value $100.3 million at end-2010. were fully sold by end-2009. While gain on investment properties (net of there were new revenue streams from deferred tax and non-controlling interests) HOTELS AND RESORTS, the newly launched projects, The of $415.6 million. Also included in 2010 PROPERTY SERVICES Springdale in Shanghai and Seasons was profi t from the sale of units at AND OTHERS Park at Tianjin Eco-City, lower sales Orion Industrial Building. Sales from this segment for 2010 were reported by Serenity Cove in were $11.2 million or 13.2% lower Tianjin, Stamford City in Jiangyin, Villa Together with the higher profi t contribution than those for 2009 because of lower Riviera in Shanghai, Elita Promenade from K-REIT Asia, this segment achieved fees earned by the Group’s project in Bangalore, and The Promont and higher net profi t against last year. management arm. Madison Residences in Singapore, as a result of a lower percentage of physical Assets employed increased from This segment reported higher net loss completion achieved and/or fewer units $2.16 billion at end-2009 to $2.37 billion against last year, due mainly to lower sold. This decline was, however, partly at end-2010, due largely to the fees earned from the Group’s marketing cushioned by higher sales recognition development expenditure incurred for and project management activities. from The Arcadia in Tianjin, Riviera Ocean Financial Centre as well as the Net interest expenses were also Cove in Ho Chi Minh City (“HCMC”), fair value gain on investment properties higher as a result of an increase in Jakarta Garden City and Thailand recorded in 2010. borrowings for the funding of new trading projects. project investment and development. FUND MANAGEMENT In addition, the Group provided for Notwithstanding lower sales, net profi t The Group’s fund management impairment (net of non-controlling for 2010 was higher than last year’s business continued to perform well. interests) of $10.6 million for two hotels because of lower non-controlling Fund management fees for 2010 in Indonesia and recorded lower gain interests’ share of profi ts. increased by $26 million or 60.8% on acquisition of additional interest compared with the fees for 2009, in K-REIT Asia. Assets employed increased from as a result of higher acquisition and $2.99 billion at end-2009 to $3.76 billion management fees reported by Assets employed increased at end-2010 as a result of land acquisition Alpha Investment Partners (“Alpha”) from $277 million at end-2009 and development expenditure incurred and K-REIT Asia Management to $930.9 million at end-2010, for trading projects. (“KRAM”). Included in the fees for 2010 due to increase in cash and cash were acquisition fees of $11.4 million equivalents following the receipt of PROPERTY INVESTMENT earned by KRAM from K-REIT Asia’s net proceeds of $826 million from Rental income of $70.2 million for 2010 acquisitions of the 50% stake in 275 the asset swap arrangement as was $5.2 million or 6.8% lower than George Street in Brisbane, the 100% mentioned above.

Financial Review 111 Property Portfolio Analysis

(1) Analysis by Tenure (2) Analysis by Development Stage (3) Analysis by Sector (Singapore only) (Singapore only) (Singapore only)

$ million % $ million % $ million % Freehold 643 13.8 Completed 1,698 36.4 Office 2,968 63.6 999-year lease 915 19.6 Under development 2,293 49.2 Residential 1,621 34.8 99-year lease Awaiting development 673 14.4 Retail 10 0.2 & others 3,106 66.6 Total 4,664 100.0 Industrial 65 1.4 Total 4,664 100.0 Total 4,664 100.0

(4) Analysis by Estimated (5) Analysis by Location (6) Analysis by Location Gross Floor Area (Completed Projects) (All Projects) (Singapore only)

sm ‘000 % $ million % $ million % Office 265 51.9 Local 1,698 76.9 Local 4,664 73.9 Residential 223 43.6 Overseas 511 23.1 Overseas 1,649 26.1 Retail 1 0.2 Total 2,209 100.0 Total 6,313 100.0 Industrial 22 4.3 Total 511 100.0

Keppel Land Limited 112 Report to Shareholders 2010 The Group’s diversifi ed property acquired Keppel Towers and GE portfolio, comprising offi ce buildings, Tower pending redevelopment and residential properties, hotels and resorts, landbank awaiting development. serviced apartments, industrial buildings, shophouses and retail outlets are 3. Analysis by Sector owned through subsidiary and Of the Group’s property portfolio associated companies. in Singapore, 63.6% were offi ce buildings, which included Ocean The Group’s property portfolio amounted Financial Centre, Ocean Towers, to about $6.3 billion. Details of the Group’s Marina Bay Financial Centre, property portfolio are given on pages Equity Plaza, Prudential Tower, 258 to 275. The following analysis as at Bugis Junction Towers, One Raffl es 31 December 2010 is for the Group’s Quay and Keppel Bay Towers. effective interests only. Residential properties made up SINGAPORE PROPERTIES 34.8% while the remaining portfolio 1. Analysis by Tenure comprised retail and industrial Freehold properties constituted components in the proportions 13.8% of the Group’s properties in of 0.2% and 1.4% respectively. Singapore, with 999-year leases and 99-year leased properties making up 4. Analysis by Estimated 19.6% and 66.6% respectively. Gross Floor Area The total gross fl oor area of the Group’s 2. Analysis by Development Stage property portfolio in Singapore was Of the Group’s property portfolio in 511,000 sm. Offi ce buildings and Singapore, 36.4% were made up of residential properties formed 51.9% completed properties while 49.2% and 43.6% respectively of the total were under development. gross fl oor area. The balance comprised 0.2% for retail and Properties under development 4.3% for industrial buildings. included Ocean Financial Centre, Marina Bay Financial Centre Phase 2, OVERSEAS PROPERTIES Marina Bay Suites, Refl ections at Of the Group’s completed properties, Keppel Bay, The Lakefront Residences 23.1% were located overseas. and Madison Residences. Taking into account projects under development, overseas properties The remaining 14.4% of the Group’s constituted 26.1% of the Group’s properties comprised the newly property portfolio.

Property Portfolio Analysis 113 Sensitivity Analysis

INVESTMENT PROPERTIES pre-tax profi t derived from the For projects which have been launched, The Group’s main investment Group’s investment properties is for every additional 1% of the total properties are Ocean Towers, approximately $1.5 million. saleable area sold, the additional Equity Plaza, One Raffl es Quay, contribution to the Group’s pre-tax Marina Bay Financial Centre Phase 1, In respect of committed leases and profi t is an estimated $5.7 million. Keppel Towers, GE Tower, Bugis lease renewals, a full year’s impact on This is based on projected physical Junction Towers and Prudential pre-tax profi t for every 10% change completion and sales, and the Tower in Singapore; Saigon Centre in average rental rates from new rates properties available for sale which and International Centre in Vietnam; negotiated is about $4.5 million. the Group had as at end-2010. International Financial Centre in Indonesia; and 275 George Street, TRADING PROPERTIES BORROWINGS Brisbane and 77 King Street, The Group’s profi t from property trading Of the Group’s borrowings, 52% Sydney in Australia. The pre-tax is sensitive to actual sales achieved and are on fi xed interest rates and 48% profi t from these properties is the percentage of physical completion on fl oating rates, for which interest sensitive to changes in their recognised during the year. rate hedges have not been entered occupancies and the rental rates into. If the average interest rate for lease renewals. Based on actual sales contracts increase/decrease by 0.5%, with all signed as at 31 December 2010, other variables, including tax rate, Assuming that average rental rate is the incremental impact on the Group’s being held constant, the Group’s profi t maintained, for every 1% change in pre-tax profi t for every 5% of physical after taxation will be lower/higher occupancy, a full year’s impact on completion is about $24.4 million. by $5.0 million per year.

Change in Group’s Pre-tax Proﬁ t

Resulting from: $ million For every 1% change in occupancies (see Note A) 1.5 For every 10% change in average rental rates (see Note B) 4.5

Notes: (A) Assuming current average rentals are maintained. (B) Based on committed leases due for renewal in 2011.

Incremental Impact of Additional Sales and Completion of Trading Properties on Group’s Pre-tax Proﬁ t

Resulting from: $ million For every 5% of physical completion (see Note C) 24.4 For every 1% of additional sales (see Note D) 5.7

Notes: (C) Based on actual sales contracts signed as at 31 December 2010. (D) Based on projected physical completion and sales, and the properties available for sale at end-2010.

Keppel Land Limited 114 Report to Shareholders 2010 Economic Value Added

Economic Value Added (“EVA”) improved Economic Value Added over the past fi ve years, from a negative ($ million) 7.1 million in 2006 to a positive of $385.2 million in 2010, refl ecting a more effective utilisation of the (7.1) 222.2 45.0 81.7 385.2 Group’s resources to enhance 450 shareholder value. 300 Prior to 2010, the highest EVA was achieved in 2007 at a positive $222.2 million, contributed by the 150 strong performance in Singapore and overseas, as well as a gain of 0 $235.2 million from the restructuring of the ownership of One Raffl es Quay. -150 2006 2007 2008 2009 2010 The Group registered a record EVA of $385.2 million in 2010, a substantial increase of $303.5 million compared 2010 2009 with $81.7 million for 2009. The strong $ million $ million performance was mainly boosted by Profi t after taxation but before fair value gain/(loss) on the corporate restructuring surplus investment properties 640.8 298.1 arising from the disposal of the Group’s Adjustment for: one-third interest in Marina Bay Interest expense 38.2 41.2 Financial Centre Phase 1 to K-REIT Asia Interest capitalised – non taxable 0.6 19.3 as part of an asset swap arrangement Tax effect on interest expense adjustments (6.5) (7.0) between the Group and K-REIT Asia. Provisions, deferred tax, amortisation and other adjustments (25.2) (20.5) Net Operating Profi t After Tax 647.9 331.1

Average EVA capital employed (Note 1) 4,157.4 3,796.9 Weighted average cost of capital (Note 2) 6.32% 6.57% Capital Charge 262.7 249.4

Economic Value Added 385.2 81.7

Notes: 1. Average EVA 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 Group EVA Policy as follows: (a) Cost of equity using Capital Asset Pricing Model with market risk premium of 6% (2009: 6%) per annum; (b) Risk free rate of 2.3% (2009: 1.98%) based on yield-to-maturity of Singapore government 10-year bonds; (c) Unlevered beta of 0.68 (2009: 0.75); and (d) Pre-tax cost of debt of 3.43% (2009: 3.63%) using 5-year Singapore dollar swap offer rate plus 110 basis points (2009: 150 basis points). 3. With effect from 1 January 2009, the capital charge pertaining to investment properties under construction/redevelopment is deferred since these assets are not currently in service and are unable to generate any revenue.

Economic Value Added 115 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 2010 318.9 457.8 66.2 76.1 919.0 2009 335.9 80.9 38.7 60.9 516.4

Distributed as follows:

Employees in wages, salaries and beneﬁ ts 2010 20.0 5.4 15.0 74.1 114.5 2009 18.5 5.3 12.8 58.6 95.2 Governments in taxation 2010 58.9 13.3 11.1 16.4 99.7 2009 61.3 9.6 4.3 (2.7) 72.5 Providers of capital in dividends and interest 2010 59.9 11.1 – 123.6 194.6 2009 65.2 12.1 – 61.0 138.3 Retained for reinvestment and asset replacements 2010 180.1 428.0 40.1 (138.0) 510.2 2009 190.9 53.9 21.6 (56.0) 210.4 Total distribution 2010 318.9 457.8 66.2 76.1 919.0 2009 335.9 80.9 38.7 60.9 516.4

Total Value Added by Segment ($ million)

Employees 114.5 95.2 20.0 18.5 5.4 5.3 15.0 12.8 74.1 58.6 Governments 99.7 72.5 58.9 61.3 13.3 9.6 11.1 4.3 16.4 (2.7) Providers of capital 194.6 138.3 59.9 65.2 11.1 12.1 – – 123.6 61.0 Retained/reinvested in Group’s business 510.2 210.4 180.1 190.9 428.0 53.9 40.1 21.6 (138.0) (56.0) Total 919.0 516.4 318.9 335.9 457.8 80.9 66.2 38.7 76.1 60.9 1,000

750

500

250

-250 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 Group Group Property Property Property Property Fund Fund Hotels and Hotels and Trading Trading Investment Investment Management Management Resorts, Resorts, Property Property Services, Services, and Others and Others

Keppel Land Limited 116 Report to Shareholders 2010 Value Added Statement

2006 2007 2008 2009 2010 $ million $ million $ million $ million $ million Value added from: Sales 948.0 1,407.9 842.2 923.9 792.3 Less: Purchase of materials and services (672.3) (998.9) (517.7) (617.3) (475.9) Add: Corporate restructuring surplus/enbloc property sales/gain on acquisition of additional interest in an associated company 85.4 235.2 10.7 11.1 396.5 Gross value added from operations 361.1 644.2 335.2 317.7 712.9

In addition: Interest and investment income 56.7 58.8 50.4 34.5 29.7 Share of results of associated companies 27.6 93.9 68.1 164.2 176.4 Total value added 445.4 796.9 453.7 516.4 919.0

Distribution: To employees in wages, salaries and beneﬁ ts 60.5 87.1 85.0 95.2 114.5 To governments in taxation 46.2 83.0 43.6 72.5 99.7 To providers of capital in: Interest paid on borrowings 70.4 79.2 51.4 41.2 38.2 Dividends to non-controlling shareholders in subsidiary companies 6.6 3.9 0.2 39.4 42.0 Dividends to shareholders of the Company 36.0 43.2 144.2 57.7 114.4 Distribution in specie to shareholders of the Company 262.9 – – – – 375.9 126.3 195.8 138.3 194.6

Balance retained in the business: Depreciation 11.2 9.7 7.7 9.5 9.0 Non-controlling interests 10.9 19.4 41.8 (2.7) (25.1) Retained proﬁ ts (116.0) 412.6 29.4 169.1 496.6 (93.9) 441.7 78.9 175.9 480.5

388.7 738.1 403.3 481.9 889.3 Add: non-operating interest and investment income 56.7 58.8 50.4 34.5 29.7 445.4 796.9 453.7 516.4 919.0

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

Value Added Statement 117 Productivity Analysis

The total value added by the Group In 2009, the total value added by (including interest and investment income the Group was $516.4 million. of $29.7 million) in 2010 was $919 million. The Group’s value added, excluding Contributions from the various business interest and investment income, was segments are as follows: $481.9 million. Wages, salaries and beneﬁ ts of employees absorbed $ million $95.2 million, tax to governments Property trading 318.9 $72.5 million, and interest and Property investment 457.8 dividends to capital providers Fund management 66.2 $138.3 million, leaving a balance Hotels and resorts, property of $175.9 million which was services, and others 76.1 reinvested in the business. 919.0

Excluding interest and investment income, the Group’s value added of $889.3 million was absorbed by employees in wages, salaries and beneﬁ ts of $114.5 million, governments in taxation of $99.7 million and providers of capital in interest and dividends totaling $194.6 million. The balance of $480.5 million was reinvested in the business.

Value Added (Excluding Interest and Investment Income) ($ million)

Wages, salaries and benefits 60.5 87.1 85.0 95.2 114.5 Taxation 46.2 83.0 43.6 72.5 99.7 Interest expense and dividends 375.9 126.3 195.8 138.3 194.6 Depreciation and profit retained/reinvested (93.9) 441.7 78.9 175.9 480.5 Total 388.7 738.1 403.3 481.9 889.3 1,000

750

500

250

-250 2006 2007 2008 2009 2010

Keppel Land Limited 118 Report to Shareholders 2010 Productivity Data (Excluding Associated Companies)

Sales Per Employee ($’000)

371.8 504.1 302.7 348.6 279.5 600

400

200

0 2006 2007 2008 2009 2010

Value Added Per Employee ($’000)

157.5 258.0 135.3 134.8 285.4 300

200

100

0 2006 2007 2008 2009 2010

Value Added Per Dollar Employment Cost ($)

5.97 7.40 3.94 3.34 6.23 9

0 2006 2007 2008 2009 2010

Productivity Analysis 119 Corporate Liquidity and Capital Resources

The Group’s cash position as at end-2010 Credit Facilities was increased to about $1.6 billion ($ billion) compared with $892.7 million a year ago, due mainly to the net proceeds received from the asset swap in which the Group Floating rate borrowings 3.1 1.2 2.8 1.3 disposed of its one-third interest in Fixed rate borrowings 1.3 1.3 0.4 0.4 Marina Bay Financial Centre Phase 1 4.5 to K-REIT Asia for Keppel Towers and GE Tower from K-REIT Asia. 3.0 As a result, the Group’s net debt-equity ratio improved to 0.20 times from 0.22 times previously. 1.5

Total loans outstanding as at year-end 0 amounted to $2.5 billion, representing Available Utilised Available Utilised 57% of the total available facilities of 2010 2010 2009 2009 $4.4 billion. Out of the total loans of $2.5 billion outstanding, only 30%, Interest Cover amounting to about $761.7 million, was secured by certain subsidiary companies which pledged their assets (with a net Net interest expense (including amounts capitalised) ($ million) 32.3 29.1 book value of about $1,806.6 million) Profit ($ million) 771.3 380.4 to the ﬁ nancial institutions. Interest cover (times) 23.9 13.1

The maturity proﬁ le of the loans is $ million times as follows: 900 30

$ million 600 20 Due in 2011 317 Due in 2012 - Financial institutions 495 300 10 - Related company 102 Due in 2013 to 2017 1,602 0 0 2,516 2010 2009

As the Group operates primarily in Debt-Equity Ratio Singapore, China, Vietnam, Indonesia and India, it is exposed to currency risks. The Group will, as far as practicable, borrow in the same functional currencies Net debt ($ million) 927 834 of its overseas operations to achieve Equity (including non-controlling interests) ($ million) 4,640 3,789 a natural hedge. The loans are Debt-equity ratio (times) 0.20 0.22 denominated in the following currencies: $ million times $ million 6,000 0.23 Singapore dollar 2,323 United States dollar 88 4,000 0.21 Indonesian rupiah 50 Hong Kong dollar 18 2,000 0.19 Vietnamese dong 27 Thai baht 9 Indian rupee 1 0 0.17 2,516 2010 2009

Keppel Land Limited 120 Report to Shareholders 2010 In 2010, net interest expense charged to USE OF PROCEEDS FROM THE USE OF PROCEEDS FROM the profi t and loss account amounted COMPANY’S RIGHTS ISSUE IN 2009 THE $500 MILLION 1.875% to $13.9 million, and $18.3 million was After 17 March 2010, the Company CONVERTIBLE BONDS DUE 2015 capitalised under properties held for sale has utilised the remaining net proceeds As at 10 December 2010, out of the net and investment properties. of approximately $150.7 million from proceeds of approximately $493 million the Company’s rights issue in 2009 from the issue of the $500 million Fixed and fl oating interest rate loans at as follows: 1.875% fi ve-year convertible bond end-2010 were in the proportion of 52% – About $74.9 million have been used on 29 November 2010: and 48% respectively. As interest rates to fund the capital contributions and – About $220 million have been used moved down during the year, the average development expenditures for the for repayment of existing short-term net cost of funds in 2010 was 2.0%, Group’s residential and commercial borrowings; lower than 2.3% in 2009. Interest cover projects in Singapore, China and – About $185 million have been used was 23.9 times compared with 13.1 times Vietnam; and to fund the capital contributions for in 2009. – About $75.8 million have been used the Group’s residential projects in to fund 25% of the land payment for China; and The Lakefront Residences. – About $2 million have been used for the Group’s general corporate and The rights issue proceeds were fully working capital purposes. utilised on 16 August 2010.

Gearing Structure

Fixed Rate Borrowings Floating Rate Borrowings Total $’000 % $’000 % $’000 % Facilities available for drawdown 1,310,972 100 3,127,913 100 4,438,885 100 Amount utilised 1,310,972 100 1,205,489 39 2,516,461 57 Balance unutilised – – 1,922,424 61 1,922,424 43 Cash and cash equivalents 1,589,046 3,511,470

2010 2009 Interest cover Proﬁ t before interest, fair value gain/(loss) on investment properties/impairment and taxation ($’000) 771,257 380,363 Net interest cost expensed and capitalised ($’000) 32,260 29,133 Interest cover (times) 23.9 13.1

Weighted average net cost of borrowings (%) 2.0 2.3

Secured borrowings ratio Total secured borrowings ($’000) 761,743 336,674 Percentage of total borrowings (%) 30.3 19.5

Debt-equity ratio Total borrowings: Gross ($’000) 2,516,461 1,726,723 Net of cash ($’000) 927,415 834,012

Total equity (excluding non-controlling interests) ($’000) 4,301,271 3,375,789

Debt-equity ratio (excluding non-controlling interests): Gross borrowings (times) 0.59 0.51 Net of cash (times) 0.22 0.25

Total equity (including non-controlling interests) ($’000) 4,640,322 3,788,602

Debt-equity ratio (including non-controlling interests): Gross borrowings (times) 0.54 0.46 Net of cash (times) 0.20 0.22

Corporate Liquidity and Capital Resources 121 Business Dynamics and Risk Factors

Equipped for emergencies The Group’s strategy for enhancing – Favourable tax laws and double to ensure business continuity, the Group carries out shareholder value focuses on developing taxation treaties with Singapore, regular pandemic exercises. properties for sale and managing property and ease of repatriating funds funds. Besides the Singapore property to Singapore; market, the Group is mainly in the property markets of China, Vietnam, – Proper management of interest and Indonesia and India where there is currency rate exposures. a shortage of good quality housing to satisfy the needs of their growing The Group also faces possible middle-class populations. challenges such as political uncertainty issues or unfavourable regulatory Regionally, the success of the Group’s measures by the governments in efforts will be dependent, inter alia, on countries where it has operations. the following factors: The Group’s property fund – Availability of residential sites at management business will be further competitive prices for housing and developed for recurring income. also good sites at competitive prices Efforts are being made to identify in populous cities for township and invest in projects that will give development so that economies of the expected rates of return required scale can be achieved to provide good by investors. quality and affordable urban housing; For both its Singapore and overseas – Effective partnerships with markets, the Group may again face contractors, suppliers, joint venture economic uncertainties if the rebound partners and other stakeholders so from the recent global economic that projects can be delivered on downturn is not sustained. time and with quality; The Company will continue to monitor – Favourable lending laws and interest all major risks affecting the Group and rates for property developers and take the necessary actions to mitigate end-purchaser ﬁ nancing; or eliminate them.

Keppel Land Limited 122 Report to Shareholders 2010 Critical Accounting Policies and Recommended Accounting Practice

As required by the Companies Act, independent professional valuers. proportionate share of the acquiree’s the Group’s and Company’s fi nancial Changes in fair values of investment identifi able net assets, and this statements have been prepared in properties less provision for deferred impacts the amount of goodwill accordance with Singapore Financial tax are recognised in the profi t and recognised; and Reporting Standards (“FRS”). loss account in the year in which The following are the critical they arise. – When a business is acquired in accounting policies: stages, the previously held equity ADOPTION OF REVISED interests in the acquiree is REVENUE AND PROFIT STANDARDS remeasured to fair value at the RECOGNITION In the current year, the Group adopted acquisition date with any Revenue and profi t on partly completed a few standards that are relevant and corresponding gain or loss projects which are held for sale are effective for fi nancial years beginning recognised in the profi t and loss recognised using the percentage of on or after 1 January 2010. account, and this impacts the completion method. amount of goodwill recognised. The adoption of these standards did For Singapore trading properties under not result in any substantial change According to its transitional provisions, development, the profi t recognition to the Group’s accounting policies the revised FRS 103 has been upon the signing of sales contracts nor any signifi cant impact on the applied prospectively. Assets and and payment of the fi rst instalment fi n a n c i a l s t a t e m e n t s . liabilities that arose from business is 20% of the total estimated profi t combinations whose acquisition attributable to the actual contracts The principal effects of these changes dates are before 1 January 2010 signed. Subsequent recognition of are as follows: are not adjusted. profi t is based on the stage of physical completion. FRS 103 Business Combinations FRS 27 Consolidated and Separate (revised) Financial Statements (revised) For overseas trading properties under The revised FRS 103 introduces a Changes in signifi cant accounting development, the profi t recognition number of changes to the accounting policies resulting from the adoption upon the signing of sales contracts is for business combinations that of the revised FRS 27 include: the direct proportion of total expected will impact the amount of goodwill project profi t attributable to the actual recognised, the reported results in the – A change in the ownership sales contracts signed, but only to the period that an acquisition occurs, and interest of a subsidiary company extent that is related to the stage of future reported results. Changes in that does not result in a loss of physical completion. signifi cant accounting policies resulting control is accounted for as an from the adoption of the revised equity transaction. Therefore, The more conservative percentage FRS 103 include: such a change will have no of completion method for overseas impact on goodwill, nor will it trading properties is appropriate as – Transaction cost will no longer give rise to a gain or loss markets there are less matured and be capitalised as part of the cost recognised in the profi t and risks are greater. In respect of large of acquisition but will be loss account; trading projects both in Singapore and expensed immediately; overseas, the percentage of completion – Losses incurred by a subsidiary method is applied on a phase-by-phase – Consideration contingent on future company are allocated to the basis (i.e. one phase for every part events is recognised at fair value on non-controlling interest even if the of a project with one temporary the acquisition date and any changes losses exceed the non-controlling occupation permit). in the amount of the consideration to interest in the subsidiary company’s be paid will no longer be adjusted equity; and INVESTMENT PROPERTIES against goodwill but recognised in Investment properties are measured the profi t and loss account; – When control over a subsidiary initially at cost, including transaction company is lost, any interest costs. Subsequent to initial recognition, – The Group elects for each retained is measured at fair value investment properties are measured at acquisition of a business, to measure with the corresponding gain or fair value, determined annually by non-controlling interest at fair value, loss recognised in the profi t and Directors based on valuations by or at the non-controlling interest’s loss account.

Critical Accounting Policies and Recommended Accounting Practice 123 Critical Accounting Policies and Recommended Accounting Practice

According to its transitional provisions, its application. The revised FRS 24 entity continuously transfers to the the revised FRS 27 has been applied expands the defi nition of a related party buyer control and the signifi cant risks prospectively, and does not impact and will treat two entities as related to and rewards of ownership of the work the Group’s consolidated fi nancial each other whenever a person (or a in progress in its current state as statements in respect of transactions close member of that person’s family) construction progresses. with non-controlling interests, or a third party has control or joint attribution of losses to non-controlling control over the entity, or has signifi cant The Group’s current accounting policy interests and disposal of subsidiary infl uence over the entity. The revised for all residential property sales is to companies before 1 January 2010. The standard also introduces a partial recognise revenue using the POC changes will affect future transactions exemption of disclosure requirements method as construction progresses. with non-controlling interests. for government-related entities. The The impact on the 2010 comparatives Group is currently determining the when the Group applies INT FRS 115 As a consequence of the revision of impact of the changes to the defi nition in 2011 retrospectively, is shown in the FRS 27, FRS 7 Statement of Cash of a related party has on the disclosure notes to the fi nancial statements. Flows has been amended. Cash fl ows of related party transaction. As this is arising from changes in ownership a disclosure standard, it will have no RAP 11 Pre-Completion interests in a subsidiary company that impact on the fi nancial position or Contracts for the Sale of do not result in a loss of control are fi nancial performance of the Group Development Property classifi ed as cash fl ows from fi nancing when implemented in 2011. For the current fi nancial year, RAP 11 activities. The amendments to FRS 7 is still applicable in Singapore. In the have been applied retrospectively and INT FRS 115 Agreements for the RAP, it is mentioned that a property impact on the comparatives is shown in Construction of Real Estate developer’s sales and purchase the notes to the fi nancial statements. On 26 August 2010, the ASC issued agreement is not a construction INT FRS 115 with an accompanying contract as defi ned in FRS 11 Improvements to note that explains the application of the Construction Contract and the POC FRSs issued in 2009 Interpretation to property development method of recognising revenue, In 2009, the Accounting Standards sales in Singapore by considering which is allowed under FRS 11 for Council (“ASC”) issued an omnibus the Singapore legal framework. construction contract, may not be of amendments to FRS. There are INT FRS 115 supersedes RAP 11 applicable for property developers. separate transitional provisions for Pre-Completion Contracts for the Sale The relevant standard for revenue each amendment. The adoption of of Development Property and becomes recognition by property developers these improvements does not have effective for annual periods beginning is FRS 18 Revenue, which any signifi cant impact on the on or after 1 January 2011. When addresses revenue recognition fi n a n c i a l s t a t e m e n t s . adopted, INT FRS 115 is to be generally for all types of entities. applied retrospectively. However, there is no clear conclusion FUTURE CHANGES IN in FRS 18 whether the POC method ACCOUNTING POLICIES INT FRS 115 clarifi es when revenue and or the completion of construction The Group has not adopted the related expenses from a sale of real (“COC”) method is more appropriate following FRS/interpretations that have estate unit should be recognised if an for property developers. been issued but not yet effective: agreement between a developer and a buyer is reached before the construction As stated above, the Group recognises Revised FRS 24 of real estate is completed. INT FRS revenue and profi t on partly completed Related Party Disclosures 115 determines that contracts which do projects for sale based on the POC The revised FRS 24 clarifi es the not classify as construction contracts method. The impact on the Group defi nition of a related party to simplify in accordance with FRS 11 can only results had the COC method been the identifi cation of such relationships be accounted for using the percentage adopted, is disclosed in the notes and to eliminate inconsistencies in of completion (“POC”) method if the to the fi nancial statements.

Keppel Land Limited 124 Report to Shareholders 2010 Sustainability Report

Keppel Land is committed to deliver value to all our shareholders through Sustaining Growth in our businesses, Empowering Lives of people and Nurturing Communities where we operate.

Sustaining Empowering Nurturing Growth Lives Communities

Our commitment to business People are the cornerstone As a global citizen, we believe excellence is underpinned by of our business. that as communities thrive, an unwavering focus on strong we thrive. corporate governance and As an employer of choice, we prudent financial management. are committed to grow and We give back to communities nurture our talent pool through wherever we operate through Resource efficiency is not only continuous training and our multi-faceted approach our responsibility, but also development to help our people towards corporate social makes good business sense. reach their full potential. responsibility.

We will continue to distinguish We instil a culture of safety so We cultivate a green mindset our properties with strong value that everyone who comes to among our employees to spur offerings and hallmark quality work goes home safe. them towards adopting a for competitive edge. sustainable lifestyle.

Sustainability Report 125 Sustaining Growth Corporate Governance

CORPORATE GOVERNANCE STRUCTURE

SHAREHOLDERS

Board of Directors

Audit Committee Management Nominating Committee

Group Internal Audit Property Development Remuneration and Investment Committee

Property Fund Board Risk Management Committee

Hotels, Serviced Board Safety Apartments and Resorts Committee

Property Services

Keppel Land Limited 126 Report to Shareholders 2010 The Company’s Directors and 30 June 2010. The KLL Share Plans resource requirements and corporate Management fi rmly believe that full aim to strengthen the emphasis governance practices. The Company commitment to high standards of on long-term performance and has in place fi nancial authority and corporate governance is essential contribute to talent retention. approval guidelines for investments, to ensure the sustainability of – As part of the Board renewal divestments, loans and lines of credit. the Company’s businesses and process, Mrs Koh-Lim Wen Gin performance, as well as to safeguard was appointed as an independent In Singapore, new investments and shareholders’ interests and maximise and non-executive Director on borrowings (including fi nancial long-term shareholder value. They are 20 January 2010. Mrs Oon Kum commitments such as loans from or pleased to confi rm that the Company Loon was appointed as a non- warranties to related or third party), has adhered to the principles and independent and non-executive business acquisitions and divestments guidelines of Singapore’s Code of Director on 1 September 2010. exceeding $10 million or 1% of the Corporate Governance 2005 Mr Niam Chiang Meng retired as Group’s net tangible asset value, (“2005 Code”). an independent and non-executive whichever is lower, require the approval Director on 23 April 2010. of the Board. For overseas operations, Effective corporate governance the requirement is similar, except supports the Company’s belief in As required by the Listing Manual that the exact limit may vary slightly transparency, and helps it to be of the Singapore Stock Exchange from $10 million due to exchange rate forward-looking with fresh ideas, Securities Trading Limited (“SGX-ST”), differences. and to be more decisive in the the following sections describe how execution of strategies and initiatives. the Company has effectively applied The Board has a clear vision, and the principles and guidelines of the sets high transparency and disclosure These standards include having clear 2005 Code. standards. It ensures that obligations policies, best practices, and sound to shareholders and other stakeholders internal controls as well as a system BOARD MATTERS are understood and met. of continuous improvements. The Board’s Conduct of Affairs Principle 1: To discharge its oversight function, The Company has received many Effective Board to Lead the Board has constituted various awards for achieving high standards and Control the Company Board Committees, namely Audit in corporate governance and Committee, Nominating Committee, transparency. Information on these The Board oversees the effectiveness Remuneration Committee, Board awards is set out on pages 33 to 35. of Management as well as the Risk Committee and Board Safety corporate governance of the Company Committee. These Board Committees As part of the continuous effort to with the objective of maximising have clearly defi ned written terms of improve the Company’s corporate long-term shareholder value. Each reference. Matters which are delegated governance practices, the following individual Director is obligated to act to Board Committees for more detailed two major new initiatives took place in good faith and exercise independent evaluation and approval are reported in 2010: judgment in the best interests of to and monitored by the Board. – The Company revised its shareholders at all times. long-term remuneration incentive The Board meets regularly on plans, introducing two new share The key roles of the Board include the a quarterly basis and as warranted. plans, namely the Keppel Land review and approval of the Group’s Directors are free to discuss and Restricted Share Plan and corporate strategies and directions, voice their concerns on any matter Keppel Land Performance annual budgets, major investments, raised at the Board meetings. Share Plan (collectively the divestments and funding proposals, Telephonic and videoconferencing “KLL Share Plans”) to replace and the review of the Group’s fi nancial meetings of the Board are allowed the Keppel Land Share Option performance, risk management under the Company’s Articles Scheme with effect from processes and systems, human of Association.

Sustaining Growth Corporate Governance 127 Corporate Governance

Directors’ attendances at the meetings of the Board and Board Committees for the year ended 31 December 2010 are as shown below:

Board Committees1 Board Audit Nominating Remuneration Board Risk Board Safety No. of meetings held2 6 51744

Directors No. of Meetings Attended Choo Chiau Beng 5 of 5 ––––– Kevin Wong Kingcheung 5 of 5 ––––– Khor Poh Hwa 6 – 1 – 2 2 Lim Ho Kee 5 –163– Tsui Kai Chong 6 5 – 7 4 – Lee Ai Ming 5 3–––3 Tan Yam Pin 5 – – 7 – 4 Niam Chiang Meng3 1 of 2 – 1 – 0 of 2 – Heng Chiang Meng 4 3 – – 3 – Edward Lee Kwong Foo 6 ––––4 Koh-Lim Wen Gin4 5 ––––– Teo Soon Hoe 5 of 5 – – – – – Oon Kum Loon5 0 of 1 – – – – –

1 Changes were made to the Board Committees on 16 March 2011. This table reﬂ ects Directors’ attendances in 2010. 2 Including one meeting for independent Directors (“ID”). 3 Mr Niam Chiang Meng retired as ID on 23 April 2010. 4 Mrs Koh-Lim Wen Gin was appointed as ID on 20 January 2010. 5 Mrs Oon Kum Loon was appointed as non-executive and non-independent Director (“non-ID”) on 1 September 2010.

Upon appointment of each Director, and measuring the performance of effectiveness, taking into account a letter setting up his or her duties the board, senior management the scope and nature of the operations and responsibilities is issued to the and corporations. of the Company. Director. Directors are given appropriate orientation and briefi ngs by the On 12–13 July 2010, Mr Tan Yam Pin Mrs Koh-Lim Wen Gin was appointed Management on the business activities attended the “FutureChina global as an additional ID on 20 January 2010. of the Group, its strategic directions, forum” which provided strategic Mrs Oon Kum Loon was appointed and the Company’s corporate insights for riding China’s economic as a non-ID on 1 September 2010. governance policies and practices cycles in the next decade. Mr Niam Chiang Meng retired as when they are fi rst appointed to On 19 August 2010, Mr Heng an ID on 23 April 2010. Presently, the Board. Chiang Meng and Mrs Koh-Lim therefore, there are 12 Directors. Wen Gin attended a talk on With the exception of Mr Kevin Wong They are updated regularly on “How conglomerates are managed Kingcheung, who is the Group Chief accounting and regulatory changes, and how to manage better”. Executive Offi cer (“Group CEO”), and are also given further appropriate the rest of the 11 Directors are training from time to time. For example, BOARD COMPOSITION non-executive Directors (“NEDs”). on 6 May 2010, several Directors, AND GUIDANCE namely Mr Edward Lee Kwong Foo, Principle 2: The Board is of the view that its current Mr Tan Yam Pin, Mr Lim Ho Kee Strong and Independent size and composition are appropriate, and Mrs Koh-Lim Wen Gin, attended Element on the Board and as a group, the Directors provide a forum on “Measuring and improving relevant core competencies in areas the performance of corporate boards” The Board, through the Nominating such as accounting or fi nance, legal, which discussed the newest trends Committee (“NC”), examines and business or management experience, in corporate board governance and manages its size and composition industry knowledge, strategic planning shared the best practices in managing on an ongoing basis to ensure its experience and customer-based

Keppel Land Limited 128 Report to Shareholders 2010 experience or knowledge. Details independent decision-making, the Mr Choo Chiau Beng was appointed of the Directors’ responsibilities Company has a clear division of as an additional member. and qualifi cations are set out on responsibilities at the top of the pages 246 to 252. Company, with the non-executive The terms of reference of the NC Chairman and the Group CEO include the following: The NC also determines the having separate roles. (1) Recommend appointment/ independence of each Director annually reappointment of Directors; based on the defi nition of independence The Chairman leads the Board and (2) Perform annual review of as stated in the 2005 Code. is responsible for the management skills required by the Board, of the Board, encourages Board’s and the size of the Board; Accordingly, an ID is one who has no interaction with Management, (3) Perform annual review of relationship with the Company, its facilitates effective contribution of independence of each Director, related companies or its offi cers that NEDs, encourages constructive and ensure that the Board could interfere, or be reasonably relations among the Directors, comprises at least one-third IDs; perceived to interfere, with the exercise and promotes high standards (4) Decide, when a Director has of the Director’s independent business of corporate governance. multiple board representation, judgment to the best interests of whether the Director is able to the Company. In addition, an ID The Chairman also ensures that and has been adequately carrying should have no relationship with the Directors receive accurate, timely out his or her duties as Director any substantial shareholder of the and clear information and there of the Company; Company. The NC has deemed that is effective communication with (5) Decide how Board’s performance eight of the 12 Directors are IDs. shareholders. The Group CEO has may be evaluated, and propose full executive responsibilities over objective performance criteria, to Three NEDs, namely Mr Choo Chiau the business directions set by assess effectiveness of the Board Beng, Mr Teo Soon Hoe and Mrs Oon the Board and operational as a whole and contribution of Kum Loon are considered nominees decisions of the Group. each Director; of Keppel Corporation Limited (“KCL”), (6) Perform annual assessment of a substantial shareholder of the The Group CEO is accountable effectiveness of the Board as a Company, and are deemed to the Board for the conduct and whole and individual Directors; non-independent by the NC. performance of the Group. The (7) Formulate succession plan; and Chairman and the Group CEO (8) Report to the Board. The NEDs actively participate in setting are not related to each other. strategy and goals for the Company Process and Criteria Used for and in regularly assessing the BOARD MEMBERSHIP Appointment of New Directors performance of Management. Principle 4: To increase the reliability of the process, Formal and Transparent Process for the NC has a formal policy in identifying To facilitate a more effective check on the Appointment of New Directors and evaluating nominees for Management, the IDs also met once appointment as Directors. during the year without the presence Nominating Committee of non-IDs and Management. The main roles of the NC are to The NC will fi rst evaluate the mix of make the process of Board expertise, knowledge and experience CHAIRMAN AND appointments and re-nominations on the Board and, in consultation with CHIEF EXECUTIVE OFFICER transparent, and to assess the Management, determine the role and Principle 3: effectiveness of the Board as a whole the desirable competencies for a Chairman and Chief Executive Offi cer and the contribution of individual particular appointment. to be Two Separate Persons to Directors to the effectiveness of the Ensure a Clear Division of Board as well as to affi rm annually Recommendations from Directors Responsibilities and Balance the independence of Directors. and Management are the usual of Power and Authority source for potential candidates. As at 31 December 2010, the NC However, external help (for example, To ensure an appropriate balance of was made up of two IDs, namely Singapore Institute of Directors, power, increased accountability and Mr Lim Ho Kee (Chairman) and search consultants, etc) may also a greater capacity of the Board for Mr Khor Poh Hwa. On 16 March 2011, be used.

Sustaining Growth Corporate Governance 129 Corporate Governance

Next, the NC will conduct formal of appointment. Over time, Directors appointed an ID. With her extensive interviews with the short-listed will have developed deep insights experience in urban master planning candidates to assess their suitability into the Company’s businesses and and development, she is expected to and to verify that the candidates are operations and are, therefore, able to lend strategic counsel and insights to aware of the expectations and the level provide invaluable contributions to provide continuity and further enhance of commitment required. Finally, the the Company. the Company’s expertise in building NC will make recommendations on townships and other large-scale the appointment(s) to the Board The Board sees the importance integrated projects. for approval. of such skills to the benefi t of the Company and will exercise discretion On 1 September 2010, Mrs Oon The following criteria are used to to extend the term and retain the Kum Loon was appointed as an assess all new appointments: services of such Directors. non-ID. Mrs Oon has been an (a) Integrity; independent Director of KCL since (b) Independent mindset; Annually, the NC is required to 2004. She is also the Chairperson (c) Possession of expert knowledge determine the “independence” of KCL’s Board Risk Committee and that meets the needs of the status of the Directors. Please refer a member of its Audit, Nominating Company and complements to page 128 for the NC’s basis of and Remuneration Committees. the skills and competencies of the determining whether or not a existing Directors on the Board; Director should or should not be Mrs Oon was a veteran banker with (d) Ability to commit time and deemed independent. about 30 years of experience. Her effort to carry out duties and wealth of experience in the fi nancial responsibilities effectively; The NC also determines annually sector as well as risk management (e) Past achievements and value-add whether or not a Director with multiple will contribute signifi cantly to further to the organisations; board representations has been strengthen and grow the Company. (f) Experience in high-performing adequately carrying out his or her organisations; and duties as a Director of the Company. The NC also reviews the succession (g) Good business acumen and and leadership development plans for fi n a n c i a l l i t e r a c y . Taking into account the results of the senior management with the assistance assessment of the effectiveness of the of the Talent Review Committee, The NC is also responsible for the individual Director, and the respective which is chaired by the Group CEO re-nomination of Directors. For this Director’s actual conduct on the Board, and which comprises divisional heads purpose, the NC reviews each the NC is satisfi ed that all the Directors as members. Director’s contribution and results have adequately carried out their duties of the assessment of the performance as Directors notwithstanding their A formal process is in place to identify of the Director by his peers for the multiple board representations. high potential staff and, under a relevant year. structured framework, to actively The internal guideline adopted by plan their careers and development All Directors, including the Chairman the NC to address the issue of multiple to assume leadership positions. of the Board and Group CEO, submit board representations is that Directors themselves for re-election at regular should not serve on more than six High potential staff are enrolled onto the intervals of about once every three principal boards. Leadership Development Programme years. One-third of the Directors to undergo a diverse range of career- will retire at the Company’s The Board recognises that proper building learning experiences including Annual General Meeting (“AGM”) succession planning plays an training programmes, overseas posting, each year. important role in ensuring continuous job rotation and stretched assignments. and effective stewardship of the In addition, any newly appointed Company. As such, the NC reviews They also benefi t from mentorship Director will also have to submit himself the Company’s succession plans under a proven leader at a senior or herself for re-election at the fi rst annually to ensure the progressive level, handpicked by the Talent Review AGM following his or her appointment. renewal of the Board. Committee. This process is reviewed and discussed periodically by the It is a policy that a NED will serve On 20 January 2010, Mrs Koh-Lim Talent Review Committee and a maximum of two three-year terms Wen Gin was, as mentioned earlier, the NC.

Keppel Land Limited 130 Report to Shareholders 2010 The nature of the Directors’ appointments on Board and the details of their memberships in the Board Committees as at 16 March 2011 are set out below:

Board Committee Memberships Directors Board Membership Audit Nominating Remuneration Board Risk Board Safety Choo Chiau Beng Non-executive Chairman – Member Member – Member Non-ID Kevin Wong Kingcheung Group CEO ––––Member Non-ID Khor Poh Hwa ID – Member Member – Member Lim Ho Kee ID – Chairman Member – – Tsui Kai Chong ID Chairman – Member Member – Lee Ai Ming ID Member – – Member Member Tan Yam Pin ID – – Chairman – Chairman Niam Chiang Meng1 ID – Member – Member – Heng Chiang Meng ID Member – – Chairman – Edward Lee Kwong Foo ID ––––Member Koh-Lim Wen Gin2 ID––––Member Teo Soon Hoe Non-ID Member –––– Oon Kum Loon3 Non-ID Member – – Member –

1 Mr Niam Chiang Meng retired as ID on 23 April 2010. 2 Mrs Koh-Lim Wen Gin was appointed as ID on 20 January 2010. 3 Mrs Oon Kum Loon was appointed as non-executive and non-ID on 1 September 2010.

BOARD PERFORMANCE (b) The evaluation of individual to the members of the NC and the Principle 5: Directors’ performance is done Chairman of the Board for discussion. Formal Assessment of the once a year also by Directors on a Effectiveness of the Board as self and peer evaluation basis. The Thereafter, the independent co-ordinator a Whole and the Contribution evaluation of individual Directors will discuss the fi nal consolidated by Each Director is differentiated for executive report with the NC Chairman and the Directors and NEDs. In the case Chairman of the Board so that they may Evaluation Processes of the assessment of the individual provide the Board with the necessary The NC has implemented a process executive Director, each NED is feedback with a view to improving for evaluating the effectiveness of the required to complete the executive Board performance. Board as a whole and the contribution Director’s assessment form. The by each individual Director to the executive Director is not required Performance Benchmarks effectiveness of the Board. to perform a self, nor a peer The benchmarks for Board evaluation assessment. As for the assessment include Board size and composition, The NC sets objective performance of the performance of the NEDs, Board independence, Board processes, criteria for evaluation which allow each Director (both non-executive Board information and accountability, comparison with industry peers and executive) is required to Board performance in relation to and the Company’s share price complete the NED’s assessment discharging its principal functions, Board performance over a fi ve-year period form. Each NED is also required Committees performance in relation to vis-à-vis the Singapore Straits Times to perform a self-assessment in discharging their responsibilities set out Index and a benchmark index of addition to a peer assessment; and in their respective terms of reference, its industry peers. (c) The Chairman’s performance is and fi nancial targets. evaluated annually by NEDs. The annual process of evaluating the These targets include return on capital performance of the Board, individual The whole evaluation process employed, return on equity, debt-equity Directors and Chairman is as follows: is managed by an independent ratio, dividend pay-out ratio, economic (a) The questionnaire for the annual co-ordinator. The independent value added, earnings per share, and evaluation of the Board is co-ordinator will consolidate the total shareholder’s return (i.e. dividend completed by all Board members; evaluation returns and present a report plus share price increase over the year).

Sustaining Growth Corporate Governance 131 Corporate Governance

The individual Director’s performance as well as overall contribution to the guide the discussions and timely is assessed based on a wide range of Board and the Board Committees, resolution of issues. He is also criteria that include his or her interactive as appropriate. evaluated based on his ability to ensure and interpersonal skills, participation that adequate and timely information level at meetings, insight knowledge and The assessment of the Chairman is provided to the Board, as well as analytical skills, foresight, preparedness of the Board includes his ability to to ensure that Board Committees for the meetings, availability to attend lead the Board meetings, in terms of are formed as necessary, with clear meetings and other discussion forums, both the frequency and duration, and terms of reference.

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 Choo Chiau Beng Non-executive 63 21 January 1985 – Director 24 April 2009 Chairman 1 May 2009 – Chairman Kevin Wong Kingcheung Group CEO 55 1 November 1993 – Executive Director 23 April 2010 1 January 2000 – Managing Director and re-designated Group CEO Khor Poh Hwa Director 61 1 April 1998 24 April 2009 Lim Ho Kee Director 66 8 November 2001 25 April 2008 Tsui Kai Chong Director 55 8 November 2001 25 April 2008 Lee Ai Ming Director 56 1 November 2002 24 April 2009 Tan Yam Pin Director 70 1 June 2003 25 April 2008 Niam Chiang Meng1 Director 53 1 June 2003 – Heng Chiang Meng Director 65 1 March 2005 25 April 2008 Edward Lee Kwong Foo Director 64 1 July 2006 23 April 2010 Koh-Lim Wen Gin Director 66 20 January 2010 23 April 2010 Teo Soon Hoe Director 61 16 May 1991 24 April 2009 Oon Kum Loon Director 60 1 September 2010 –

1 Mr Niam Chiang Meng retired as ID on 23 April 2010.

ACCESS TO INFORMATION Directors may better understand regulations, including the requirements Principle 6: the matters before their deliberations of the Companies Act, are complied Board Members to Have Complete, at the meetings, and the Board with, with the assistance of the Adequate and Timely Information meeting time may be conserved relevant senior management staff. and discussion time focused on Management provides the Board with questions that the Directors may The Company Secretary attends complete, accurate and adequate have on the Board papers. all Board meetings. The appointment information in a timely manner in and the removal of the Company recognition of its obligation to do so. Managers who can provide additional Secretary are subject to approval insight into the matters to be of the Board. The provision of information such as discussed will be present at the management accounts on a monthly relevant time during the Board The Board takes independent basis, enables the Directors to keep meetings. The Directors are provided professional advice as and when abreast of the Group’s operational and with the names and contact details necessary to enable it or the ﬁ nancial performance and position. of the Company’s senior management IDs to discharge its or their Management also updates the staff and the Company Secretary to responsibilities effectively. Subject Board on key issues and prospects facilitate direct access to Management to the approval of the Chairman, of the Group. and the Company Secretary. Directors may seek and obtain independent professional advice As a general rule, Board papers are The Company Secretary is responsible to assist them in their duties. sent to Directors about seven days for ensuring that Board procedures are The cost of such advice is borne before Board meetings so that followed and that applicable rules and by the Company.

Keppel Land Limited 132 Report to Shareholders 2010 In June 2010, as part of regular to drive the Group’s businesses Directors’ fees are established communication with Management, forward in order to maximise annually for the Chairman and the the Board and Management had long-term shareholder value. other Directors. Additional fees are held a two-day offsite meeting in The terms of reference of the paid, where applicable, for participation Shanghai, China to review the Group’s RC are as follows: in Board Committees. strategies, business directions and business environment. In consultation with the Chairman The level of fees takes into account of the Board, the size and complexity of the REMUNERATION MATTERS (1) Recommend to the Board Company’s operations, and the Procedures for Developing a framework of remuneration responsibilities and workload Remuneration Policies for the Board members and requirements of Directors. Principle 7: key executives; Formal and Transparent (2) Determine specifi c remuneration The fees are submitted to shareholders Procedure for Fixing the packages for each executive for approval at each AGM. The Group Remuneration Packages of Director and the Chief Executive CEO, being an executive Director, Individual Directors Offi cer (if the Chief Executive does not receive Director’s fees. Offi cer is not an executive Level and Mix of Remuneration Director); Remuneration Policy for Principle 8: (3) Decide the early termination Executive Directors and Remuneration of Directors to be compensation of Directors; Other Key Executives Adequate and Not Excessive (4) Consider whether Directors The RC also reviews the remuneration should be eligible for benefi ts of senior management staff annually. Disclosure of Remuneration under long-term incentive The Company adopts a remuneration Principle 9: schemes (including weighing system that is aimed at attracting, Clear Disclosure on the use of share schemes retaining and motivating talent on Remuneration Policy, Level against other types of long-term a sustainable basis. and Mix of Remuneration, incentive scheme); and the Procedure for (5) Review the terms, conditions The system, which takes into account Setting Remuneration and remuneration of the market competitiveness considerations, senior executives of the is designed to incentivise performance The Remuneration Committee Company; of the Company, its business units and (“RC”) consists of fi ve Directors (6) Administer the Company’s individual employees. currently, namely Mr Tan Yam Pin employee share option (Chairman), Mr Choo Chiau Beng, scheme (the “Keppel Land The RC ensures that both the total Mr Khor Poh Hwa, Mr Lim Ho Kee Share Option Scheme”) remuneration as well as individual and Prof Tsui Kai Chong. Mr Choo in accordance with the pay components – annual fi xed cash, Chiau Beng and Mr Khor Poh Hwa rules of the scheme; and the annual performance incentive joined the RC on 16 March 2011. (7) Grant share awards under the and the long-term incentive are new KLL Share Plans as this market competitive and are They are responsible to approve Committee may deem fi t. performance-driven. the framework of remuneration for the entire Group and review No member of the RC or any The annual fi xed cash component the appropriateness, transparency other Director will be involved in comprises the annual basic salary plus and accountability to shareholders deliberations in respect of any any other fi xed allowances which the on the remuneration issues of remuneration, compensation, Company benchmarks with the the Directors and senior management option or any form of benefi ts relevant industry market data. staff in the Company. to be granted to him or her. The annual performance incentive The aim of the RC is to motivate The RC will recommend to the which is tied to the performance of the and retain Directors and key Board the specifi c remuneration Company, business unit and individual executives, and ensure that the packages for the Directors upon employee, is inclusive of a portion Company is able to attract and their recruitment and review which is tied to Economic Value Added retain the best talent in the market Directors’ fees annually. (“EVA”) performance.

Sustaining Growth Corporate Governance 133 Corporate Governance

The EVA performance incentive (b) KLL Share Plans the performance targets set under is currently extended to only At the Extraordinary General the KLL RSP and KLL PSP will senior management staff who Meeting of the Company held be different. have greater line of sight to value on 23 April 2010, the Company’s creation. The EVA performance shareholders approved the adoption In addition, the targets for the KLL incentive plan and the KLL of two new share plans, the PSP, which will be more stretched Share Plans are both long-term Keppel Land Restricted Share Plan than those under the KLL RSP, incentive plans. (“KLL RSP”) and the Keppel Land emphasise strategic goals linked Performance Share Plan to sustaining longer-term growth. Long-Term Incentive Plans (“KLL PSP”), with effect from (a) EVA Incentive Plan the date of termination of the Details of the KLL Share Plans are set Each year, the current year’s Keppel Land Share Option Scheme out on pages 204 and 205. EVA bonus earned is added to (“the Scheme”). the accrued EVA bank balance To enable it to carry out its duties, the of the preceding year and The Scheme was terminated RC has access to expert advice in the thereafter one-third (1/3) is paid on 30 June 2010. Options granted fi eld of executive compensation inside out provided the total EVA and outstanding prior to the and/or outside the Company, where balance is positive. termination will continue to be valid necessary. and subject to the terms and The other two-third (2/3) of conditions of the Scheme. During the year, the RC had external the total EVA balance is credited consultants to continue the review of to the employee’s EVA Bank The KLL Share Plans were put in the compensation framework and for payment in future years, place to increase the Company’s package for the Group CEO and subject to the continued EVA effectiveness in its ongoing efforts senior management staff. performance of the Company. to attract, retain and motivate employees to achieve superior No employee of the Company and its The EVA bank mechanism performance and to maximise subsidiaries was an immediate family involves deferring incentive long-term shareholder value. member of any Director and whose compensation over a time remuneration exceeded $150,000 horizon to ensure that the The KLL RSP is targeted at a during the fi nancial year ended employee focuses on broader base of employees while 31 December 2010. “Immediate generating shareholder the KLL PSP is awarded to a family member” means the spouse, value over longer term. selected group of key senior child, adopted child, stepchild, management staff. Generally, brother, sister and parent. There are individual EVA banks which refl ect the employee’s The framework for determining non-executive Directors’ fees is as follows: contribution to the EVA performance of the Company. Non-executive Director Chairman $75,000 per annum Monies credited into the EVA bank Member $45,000 per annum are at risk as the amount in the Audit Committee Chairman $25,000 per annum EVA bank can decrease if EVA Member $15,000 per annum performance is adversely affected Nominating, Remuneration, Chairman $15,000 per annum in the future years. Board Risk and Board Safety Committees Member $10,000 per annum

Keppel Land Limited 134 Report to Shareholders 2010 The level and mix of remuneration of the Company’s Directors and top six senior managers for the year ended 31 December 2010 are as follows:

Performance-Related Bonuses Earned (including EVA and Non-EVA Bonuses) Base/Fixed Deferred Director’s Contingent Awards Remuneration Band and Name Salary Paid and at Risk2 Fee of Shares/Units4 (A) Directors Above $3,000,000 to $3,250,000 Kevin Wong Kingcheung 26% 37% 37% – 0 to 200,000 PSP 0 or 70,000 RSP

Below $250,000 Choo Chiau Beng – – – 100% – Khor Poh Hwa – – – 100% – Lim Ho Kee – – – 100% – Tsui Kai Chong – – – 100% – Lee Ai Ming – – – 100% – Tan Yam Pin – – – 100% – Niam Chiang Meng1 – – – 100% – Heng Chiang Meng – – – 100% – Edward Lee Kwong Foo – – – 100% – Koh-Lim Wen Gin – – – 100% – Teo Soon Hoe – – – 100% – Oon Kum Loon – – – 100% –

(B) Top Six Senior Managers Above $1,750,000 to $2,000,000 Loh Chin Hua 33% 67% – – 0 to 120,000 PSP

Above $1,500,000 to $1,750,000 Ang Wee Gee 30% 38% 32% – 0 to 120,000 PSP 0 or 40,000 RSP

Above $1,000,000 to $1,250,000 Tan Swee Yiow 30% 38% 32% – 0 to 80,000 PSP 0 or 30,000 RSP

Augustine Tan Wee Kiong 31% 37% 32% – 0 to 80,000 PSP 0 or 30,000 RSP

Above $750,000 to $1,000,000 Ng Hsueh Ling 50% 50% – – 0 to 108,000 PUP3 0 or 54,000 RUP3

Lim Kei Hin 36% 34% 30% – 0 to 56,000 PSP 0 or 21,000 PSP

1 Mr Niam Chiang Meng retired as ID on 23 April 2010. 2 A portion of senior management staff’s annual performance incentives is tied to EVA performance. Details of the EVA Incentive Plan are set out on page 134. 3 These refer to K-REIT Asia units (“Units”) awarded under the Restricted Unit Plan (“RUP”) and Performance Unit Plan (“PUP”) of K-REIT Asia Management Limited. 4 Shares/Units awarded under the PSP/PUP and RSP/RUP are subject to pre-determined performance targets set over a three-year and a one-year performance periods respectively. For the PSP and PUP, the additional awards can be up to 50% of the maximum range depending on the achievement of the pre-determined performance targets at the end of the three-year performance period.

Sustaining Growth Corporate Governance 135 Corporate Governance

ACCOUNTABILITY Prof Tsui Kai Chong, Mr Heng Chiang removal of the Head of Group Principle 10: Meng, Mr Teo Soon Hoe and Mrs Oon Internal Audit Department; The Board’s Accountability to the Kum Loon have accounting and related (12) With regard to the whistle-blower Shareholders and Management’s fi n a n c i a l m a n a g e m e n t e x p e r t i s e , w h i l e protection policy, review protected Accountability to the Board Mrs Lee Ai Ming provides expertise reports and any matter arising in legal issues. The AC’s primary role is thereon or in connection therewith, The Board is committed to provide to assist the Board to ensure integrity and decide on any appropriate shareholders with a balanced and of fi nancial reporting and that there is in action to be taken; and understandable assessment of the place sound internal control systems. (13) Investigate any matter within the Company’s fi nancial performance, Committee’s terms of reference position, and prospects, including The AC is guided by the following terms set out herein, whenever it interim and other price-sensitive public of reference: deems necessary. reports, and reports to regulators (1) Review audit plans and reports of the (if required). external auditors and internal auditors During the year, the AC reviewed and consider effectiveness of actions/ the external and internal auditors’ The Board provides shareholders policies taken by Management on the plans and fi ndings to ensure they are with quarterly and annual fi nancial recommendations and observations; suffi cient to assess the adequacy and results within 30 days from the (2) Perform independent review of effectiveness of the signifi cant internal end of each quarter and fi nancial fi nancial statements and results, controls of the Company. year-end. The Board believes that including quarterly results, the timely release of such fi nancial forecasts and annual budgets; The AC also performed independent statements is important as it enables (3) Examine and report on effectiveness reviews of the fi nancial statements of the shareholders to receive information of fi nancial, operating and compliance Company before the announcements on the performance, position and controls (including risk management of the results. The reviews included prospects of the Company regularly and safety management controls); an assessment of the quality of key and promptly. (4) Review the Group’s internal audit accounting principles applied and activities’ quality through an Management’s judgments which Management provides all members independent quality assurance review; have a major impact on the fi nancial of the Board with management (5) Review the independence and statements. On a quarterly basis, accounts which present a balanced objectivity of the external auditors Management reported to the AC and understandable assessment of and internal auditors annually; all IPTs in accordance with the the Company’s performance, position (6) Review nature and extent of Company’s shareholders’ mandate for and prospects on a monthly basis. non-audit services performed by IPTs. The IPTs were audited by Such reports enable the Directors the external auditors; the internal auditors on a semi-annual to keep abreast of the Group’s (7) Meet with external auditors and internal basis, and their fi ndings reported operational and fi nancial performance auditors, without the presence of to the AC. and position. Any material variances Management, at least annually; between the projections and actual (8) Review and ensure at least annually The AC has explicit authority to results are disclosed and explained. that internal audit function is investigate any matter within its adequately resourced and has terms of reference, full access to INTERNAL CONTROL AND AUDIT appropriate standing within the and cooperation by Management Principle 11: Company, and has full, free and and full discretion to invite any Establishment of Audit Committee unrestricted access to all Group Director or executive offi cer to attend with Written Terms of Reference activities, records, properties and its meetings, and has reasonable personnel to fulfi ll its objectives; resources to enable it to discharge Audit Committee (9) Review interested person its functions properly. The Audit Committee (“AC”) consists transactions (“IPTs”); of fi ve Directors, namely Prof Tsui Kai (10) Review the appointment of the The AC held fi ve meetings during the Chong (Chairman), Mrs Lee Ai Ming, external auditors, the external year. The members’ attendances at these Mr Heng Chiang Meng, Mr Teo Soon auditors’ remuneration and any meetings are disclosed on page 128. Hoe and Mrs Oon Kum Loon, the question of resignation or dismissal The external and internal auditors, the last two of whom were appointed of the external auditors; Group CEO, the Director, Corporate on 16 March 2011. (11) Approve the appointment and Services and the Chief Financial Offi cer

Keppel Land Limited 136 Report to Shareholders 2010 were invited to attend its meetings. and effective management of risks. the interests of the Company in dealing The Company’s external and internal However, it should be recognised that with its suppliers, customers and other auditors report their audit fi ndings and such system is designed to provide third parties. Briefi ngs for all staff were recommendations independently to the reasonable assurance, but is not an held when the policy was introduced. AC. The AC also met with the external absolute guarantee, against material New employees are briefed on the and internal auditors, without the misstatement or loss. policy when they join the Company’s presence of Management, during orientation programme. the fi nancial year. The Company has put in place a shareholder value-based internal control Whistle-blower Protection Policy In addition, the AC reviewed the system in areas such as fi nancial, The Company has a whistle-blower independence and objectivity of operational and compliance controls, and protection policy to encourage the the external auditors through discussions risk management. The principal aim of the reporting in good faith of suspected with the external auditors as well as the internal control system is the management reportable conduct by establishing non-audit fees awarded to them. The AC of business risks with a view to clearly defi ned processes through which has confi rmed that the non-audit services safeguarding shareholders’ investments such reports may be made with the performed by the external auditors did and the Company’s assets. confi dence that employees and other not affect their independence. persons making such reports to the The system includes, inter alia, employees’ supervisors, AC Chairman INTERNAL CONTROLS enterprise risk management and or Head of Group Internal Audit will be Principle 12: internal auditing. The Board monitors treated fairly and, to the extent possible, Sound System of Internal Controls the Company’s risks through the protected from reprisal. Board Risk Committee, Board Safety The AC reviews the reports submitted Committee, AC, Enterprise Risk The AC Chairman is kept informed of by the external and internal auditors Management Committee (“ERMC”) all cases reported. Anonymous reports relating to the effectiveness of the and Group Internal Audit. are also accepted. The policy and Company’s signifi cant internal controls, contact details of AC Chairman and including fi nancial, operational and Policies, Procedures and Practices Head of Group Internal Audit have compliance controls, and management Internal controls are detailed in formal been briefed to and made available of risks of fraud and other irregularities. instructions, standard operating to all employees. procedures and fi nancial authority limits The AC also reviews the effectiveness policies. Their compliances are reviewed Upon receipt of allegations of fraud of the actions taken by Management by the relevant Board Committees or other misconduct reported under on the recommendations made by the as well as the Company’s internal the whistle-blower protection policy, external and internal auditors in this auditors and ISO Internal Quality the AC will ensure that the necessary respect Based on the assessment Management System auditors. investigations are carried out in a timely by the AC, supported by the work manner. AC will also ensure that any performed by the internal auditors Employee Code of Conduct disciplinary, civil and/or criminal action during the fi nancial year and taking To build a culture of high integrity as well that is initiated following completion of into consideration the review as reinforce ethical business practices, investigations, is appropriate, balanced, undertaken by the external auditors, the Company has in place an employee and fair. the AC is satisfi ed that the internal code of conduct policy. This policy controls are adequate to meet the addresses, at the employee level, the The AC will also monitor the actions needs of the Company in its current standards of acceptable and unacceptable taken to correct the weaknesses business environment. behaviour and personal decorum as well in the existing system of internal as issues of workplace harassment. processes and policies which resulted Risk Management in or may cause the perpetration of the The system of internal controls On the business front, the policy fraud and/or misconduct, to prevent established by the Company is addresses the standards of business any recurrence. designed to manage, rather than behaviour pertaining to the offering and eliminate, the risk of failure in achieving receiving of business courtesies as well Board Risk Committee Company’s goals and objectives. There as issues on confl ict of interests. The The Board Risk Committee (“BRC”) was are clear policies and procedures in policy also requires all staff to avoid any established to examine the effectiveness ensuring the adequacy of controls confl ict between their own interests and of the Company’s risk management

Sustaining Growth Corporate Governance 137 Corporate Governance

system and ensure that a robust listed above from time to time as (3) Recommend the adoption of system is maintained. Its members are this Committee may deem fi t. acceptable H&S practices in now Mr Heng Chiang Meng (Chairman), the industry in which the Prof Tsui Kai Chong, Mrs Lee Ai Ming The BRC is supported by the ERMC Company operates; and Mrs Oon Kum Loon. comprising all the heads of department. (4) Receive reports concerning H&S The ERMC reports to the BRC quarterly incidents within the Company; and The BRC reviews and guides to ensure that the actions to mitigate (5) Consider H&S issues that may have Management in the formulation of risk or reduce the top nine enterprise strategic, business and reputational policies and processes to identify, risks that have been identifi ed have implications for the Company. evaluate and manage signifi cant risks. been implemented, and to report The BRC also discusses risk management on the effectiveness of the actions The BSC held four meetings during strategies with Management. The BRC or improvements to the risk the year. The members’ attendances reports to the Board on material fi ndings mitigating actions. at these meetings are disclosed on and recommendations in respect of page 128. signifi cant risk matters. The BRC held four meetings during the year. The members’ attendances at these INTERNAL AUDIT The terms of reference of the BRC are meetings are disclosed on page 128. Principle 13: as follows: Based on the review of work done by Independent Internal Audit Function (1) Review the Keppel Land Group’s ERMC, the BRC is satisfi ed that the risk risk profi le regularly; management procedures are adequate The Company has its own in-house (2) Prioritise and guide the Group on to meet the needs of the Company in its Internal Audit Department (“Group risk management issues; current business environment. Internal Audit”) that is independent of the (3) Review and guide in establishing activities it audits. Group Internal Audit processes to effectively identify, Board Safety Committee reports directly to the Chairman of the evaluate and manage signifi cant risks; The Company’s Board Safety Committee AC and administratively to the Group (4) Examine the effectiveness of the (“BSC”) guides Management to enhance CEO. Group Internal Audit’s authority Group’s risk management system the Group’s commitment to work safety is specifi ed in the Internal Audit Charter to ensure that a robust risk in all workplaces and to foster a safety which was endorsed by the AC. management system is maintained; culture in the Company. Currently, its (5) Discuss risk mitigating strategies members comprise Mr Tan Yam Pin The key role of Group Internal Audit with Management; (Chairman), Mr Choo Chiau Beng, is to assist the AC to provide (6) Review and guide the Group in Mr Kevin Wong Kingcheung, Mr Khor reasonable assurance that the formulating its risk policies and Poh Hwa, Mrs Lee Ai Ming, Mr Edward Company is maintaining an risk limits, where applicable; Lee Kwong Foo and Mrs Koh-Lim adequate system of internal controls (7) Liaise with the AC to ensure that Wen Gin. The BSC is supported by by periodic reviews of material issues of common concern are the Management Safety Committee controls and procedures to test addressed appropriately; (“MSC”). their effectiveness. (8) Encourage and foster greater awareness of enterprise risk The terms of reference of the BSC To ensure that internal audits are management at all levels of are as follows: performed by competent professionals, the Group; (1) Establish the health and safety Group Internal Audit employs qualifi ed (9) Provide a forum for discussion on (“H&S”) policies; staff, including a number of Certifi ed risk issues; (2) Monitor the Company’s compliance Internal Auditors. They are provided (10) Consider urgent ad hoc risk issues with the approved H&S policies by: with adequate training and development and, where applicable, refer them (a) Assessing the adequacy of H&S in order that their technical knowledge to the Board with risk action plans; standards prepared by the MSC; remains current and relevant. (11) Report material matters, fi ndings (b) Assessing the operations of the and recommendations on risk Company and recommendations Group Internal Audit is committed management to the Board; of the MSC on elimination, control to meet or exceed the Standards for (12) Perform such other functions as the and minimisation of H&S risks; and the Professional Practice of Internal Board may determine; and (c) Assessing the compliance of Auditing (“Standards”) set by The (13) Sub-delegate any of its powers the Company with applicable Institute of Internal Auditors Inc within its terms of reference as legislations; (the “Institute”), which has its

Keppel Land Limited 138 Report to Shareholders 2010 headquarter in the USA, and The AC ensures that the internal audit Phase 1 and acquire K-REIT Asia’s has incorporated them into its function has adequate resources and Keppel Towers and GE Tower for audit practices. appropriate standing within the Company. redevelopment into high-rise city On an ongoing basis, it assesses the homes, Management met with A quality assurance programme effectiveness of the internal auditors, both local and overseas investors comprising continuous internal such as its scope of work and quality from the USA, UK, Europe and and regular independent external of audit reports. Hong Kong to explain the mutual assessments is in place to ensure that benefi ts of the deal. The successful audits are performed in accordance COMMUNICATION WITH completion of the deal refl ects with the Institute’s Standards. SHAREHOLDERS strong shareholders’ support for Principle 14: the Company. The Standards require that an Regular, Effective and Fair external assessment on quality Communication with Shareholders The investor relations team also assurance be conducted at least received and responded to queries once every fi ve years. The latest quality Principle 15: from shareholders on corporate assurance review was performed by Greater Shareholder Participation actions such as the issue of the independent external reviewer in 2007, at Annual General Meetings $500 million unsecured convertible and Group Internal Audit was assessed bonds and the Company’s dividend to be generally in compliance with Proactive Engagement reinvestment scheme. the Standards. with Shareholders The Company constantly strives to To give investors better Using a risk-based audit methodology, put in place best-in-class investor understanding and insights into its Group Internal Audit plans its internal relations practices to engage and business operations, the Company audit assignments annually in further strengthen relationships with led and facilitated a total of 30 visits consultation with, but independent of, its shareholders. It takes a proactive to its projects in Singapore and Management. Its plan is submitted to approach and regularly engages in overseas. These included Refl ections and approved by the AC. timely communication with its at Keppel Bay and Marina Bay shareholders, investors, analysts, Financial Centre in Singapore, Based on the risk assessment fund managers, the media and residential projects in Shanghai conducted by Group Internal Audit, the general public through various and Wuxi as well as the Tianjin activities within the Group are platforms such as corporate Eco-City in China, all of which reviewed at appropriate intervals and announcements, full-year and have received positive feedback with greater emphasis on higher risk half-year combined briefi ngs to from investors. activities. Internal audit plans are media and analysts, investor meetings also aligned with the Company’s risk as well as roadshows in Singapore At the same time, Management management programme. and overseas. actively engaged overseas investors through conference calls and The aim is to ensure that an effective Through regular communications, roadshows. These sessions help and effi cient control environment is in stakeholders are given balanced clarify issues that investors have place to manage those risks exclusive insights into the Group’s strategic on developments as well as provide to a particular business unit in addition directions, performance, key platforms for discussions on its to those that may be relevant on an development and plans for sustainable strategies. The Company participated enterprise-wide basis. earnings growth. Capitalising on the in 17 conferences and roadshows improving economic climate and renewed in Singapore, Hong Kong and A comprehensive progress report investor interest, the Company undertook Kuala Lumpur in 2010. is presented by Group Internal Audit a higher level of investor activities in to the AC at each scheduled meeting. 2010. In total, Management held more Pertinent information is communicated All audit reports are distributed to than 60 meetings with analysts and to shareholders on a timely basis. the AC, the Chairman of the Board, fund managers. Should there be an inadvertent the Group CEO, the Director, disclosure made to a selected group, Corporate Services, the Chief In the asset swap deal with K-REIT the Company will make the same Financial Offi cer and other relevant Asia to divest its one-third interest in disclosure publicly to all others as senior management staff. the Marina Bay Financial Centre soon as practicable.

Sustaining Growth Corporate Governance 139 Corporate Governance

To keep communication channels Each item of special business included in Index, conducted by The Business accessible and timely so as to serve the notice of the meeting is accompanied Times and the Corporate Governance the interests of the investing community by an explanation for the proposed and Financial Reporting Centre at the well, the Company disseminates all resolution. Separate resolutions are National University of Singapore and announcements, press releases and proposed for substantially separate issues sponsored by CPA Australia. It also presentation slides simultaneously to at the meeting, and the Chairman declares received the runner-up award for the the Singapore Exchange via SGXNET the number of proxy votes received for Most Transparent Company under and the Company’s website. Its corporate and against the resolutions. the Properties category for the 11th website (www.keppelland.com.sg) has consecutive year at the SIAS Investors’ also been revamped to one that is more The Company also prepares detailed Choice Awards 2010. investor-friendly, featuring key fi nancial minutes of general meetings, which and corporate information as well as include substantial comments or queries Looking ahead, the Company will continue sales and projects updates. from shareholders and responses from its conscientious investor relations efforts the Board and Management. These to maintain active engagement and The website provides, inter alia, minutes are available to shareholders positive relationships with shareholders corporate announcements, press upon request. and the investment community. The releases, annual reports, and profi les Company will continue to strive to of the Group. The Company’s 10-year The Company is not implementing enhance its strong culture of governance fi nancial profi le is also provided. Where absentia voting methods such as voting and transparency. appropriate, queries over the website via mail, e-mail or fax until the security, are also addressed. integrity and other pertinent issues are Security Transactions satisfactorily resolved. The Company has issued a policy on The AGM is the principal forum for dealings in the securities of the Company dialogue with shareholders. The Company’s drive to provide and its listed subsidiaries to its Directors Shareholders are informed of transparent disclosure has won the and employees, setting out the implications shareholders’ meetings through confi dence of institutional shareholders. of insider trading and guidance on such notices published in the newspapers As at end-December 2010, about 30% dealings. It has adopted the Best Practices and reports or circulars sent to of the Company’s shareholding is made Guide on Dealings in Securities issued all shareholders. up of institutional shareholders, spanning by the SGX-ST. across cities in Asia, North America, Shareholders are invited at such Europe, Australia, New Zealand and The Company prohibits its Directors meetings to raise any question they the Middle East. More than 20 brokers and employees from trading in the may have on the motions to be debated currently cover its stock in Singapore. Company’s securities for the period and decided upon. If any shareholder commencing two weeks before is unable to attend, he is allowed to The publication of the Company’s the announcement of the fi rst three appoint up to two proxies to vote on Global Reporting Initiative accredited quarterly results, and the period his behalf at the meeting through proxy Level B+ Sustainability Report as well commencing one month before the forms sent in advance. as its inclusion as an index component announcement of the year-end results. of the Dow Jones Sustainability Asia The Chairman and, where appropriate, Pacifi ca Index in 2010 further helped Interested Person Transactions the Group CEO will respond to place it on the radar screen of socially Disclosure of interested person shareholders’ questions. The chairmen responsible funds. transactions is set out on page 141. of the Board Committees and the When a potential confl ict of interest external auditors are required to be For its efforts, the Company was ranked arises, the Director concerned takes present at the meeting to assist in among the top 2% out of 681 listed no part in discussions nor exercises addressing relevant queries from companies for its high level of disclosure any infl uence over other members the shareholders. in the Governance and Transparency of the Board.

Keppel Land Limited 140 Report to Shareholders 2010 Interested Person Transactions

Aggregate Value of all Interested Person Transactions during the Period under Review (excluding Transactions less than Aggregate Value of all Interested Pe $100,000 and Transactions Conducted rson Transactions Conducted under under Shareholders’ Mandate Pursuant Shareholders’ Mandate Pursuant to Name of Interested Person to Rule 920 of SGX-ST Listing Manual) Rule 920 of SGX-ST Listing Manual 2010 2009 2010 2009 $’000 $’000 $’000 $’000 (a) Property transactions – Keppel Corporation Limited Group: Project development and management fees received – – 1,734 2,108 Property management fees received – – 2,043 1,974 Marketing commission received – – 5,504 3,886 Management and support service fees received – – 7,144 3,743 Asset management fees received – – 35,879 14,220 Rental expense – – (3,666) (3,029) Aggregate consideration for disposal of one-third interest in Marina Bay Financial Centre Phase 1 1,399,221 – – – Consideration for acquisition of Keppel Towers and GE Tower from K-REIT Asia (573,000) – – –

(b) Other services and products – Keppel Corporation Limited Group: Treasury – interest income – – 272 777 Treasury – interest expense – – (2,344) (11,276) Management fees paid – – (5,237) (3,922) Other products and service fees paid – – (717) (507) Deposits outstanding at year-end – – 932,580 299,788

Temasek Group: Rental received – – 214 243 Management fees paid – – – (257) Consideration for sale of 3.5% interest in Singapore Tianjin Eco-City Investment Holdings Pte Ltd to Singbridge International Singapore Pte Ltd 5,698 – – –

(c) Transactions entered into by the Group with Directors of the Company – Consideration for the sales of units in Singapore and overseas residential development to Directors of the Company and/or their immediate family members at prevailing prices applicable to third parties 1,209 4,577 – –

Sustaining Growth Corporate Governance 141 Sustaining Growth Risk Management

Risk management remains a vital initiatives. In addition, the committee can respond effectively to disruptive element in Keppel Land’s business provides direction on the review of events such as a fl u pandemic or planning and day-to-day operations. risk-related policies and best practices acts of terrorism while minimising In a dynamic business environment, the on risk management. The fi nancial, operational disruption. Company’s enterprise risk management reputational and operational aspects (ERM) processes need to be robust in of enterprise risks are monitored by Business units in Singapore and abroad order to respond swiftly to challenges. the committee. are required to establish, review and Keppel Land continues to reinforce its test their business continuity plans. ERM framework and processes Throughout the year, risk management Workshops were organised to review in Singapore and overseas. plans by the various business units are critical business functions and facilitate reviewed to ensure that risk factors stay discussions between business units to For more details on Keppel Land’s current and appropriate mitigating actions ensure that critical interdependencies risk management, please refer to its are adequate and promptly carried out. were considered and cross-unit Sustainability Report 2010. Key risk indicators are also monitored support services would be guaranteed and tracked on a regular basis. in the event of a crisis. STRENGTHENING ERM SYSTEM Keppel Land’s Board Risk Committee Through focus group discussions During the year, the IT department tested (BRC), comprising four independent Board among ERMC members, the Company’s its responsiveness in disaster recovery directors, meets quarterly to provide enterprise risk profi le has been reviewed and management by stress-testing IT oversight on key risk issues and monitor to ensure that it is relevant in the current recovery systems. the Company’s country exposures business environment. The ERMC has and signifi cant projects. The BRC also endorsed the key enterprise risks for FOSTERING RISK provides guidance on risk mitigation 2011 and is committed to monitoring MANAGEMENT CULTURE strategies and risk policies. and actively managing these risks. An online assessment of the enterprise- wide risk culture was conducted The Enterprise Risk Management REINFORCING OPERATIONAL during the year. To identify and bridge Committee (ERMC), whose members PREPAREDNESS any gaps to enhance the Company’s comprise all heads of department, is Emphasis is placed on establishing current risk management practices. responsible for driving and overseeing robust business continuity plans Staff were invited to participate in this the implementation of risk management to ensure that business operations exercise and more than 70% of staff

Keppel Land Limited 142 Report to Shareholders 2010 responded. The assessment shows of the regular orientation programme. reﬁ ne and test their recovery plans senior management’s commitment The Company leverages events such as developed. Best practices and lessons to risk management leadership. Risk the Annual Staff Conference to update learnt will be shared. management is embedded in business and reach out to overseas staff and processes and inculcated among postees on ERM. The Company will evalulate the adequacy staff through continuous education of current internal controls and put in and training. Challenges faced in MOVING FORWARD place additional measures to build a implementing risk management in Keppel Land will continue to closely comprehensive anti-fraud framework. business operations were identiﬁ ed and monitor and mitigate its key enterprise training plans developed to strengthen risks for 2011. The Company will roll out various risk management capabilities. initiatives throughout the year to heighten New scenarios that may disrupt business awareness on ERM. Activities will include New employees are briefed on the operations will be considered and talks with the theme, “Every staff is a Company’s risk management appropriate response plans developed. risk manager” and an online educational framework and processes as part All business units will continue to review, tutorial and quiz will be developed.

Managing Enterprise Risks

In 2010, Keppel Land’s key enterprise risks and appropriate mitigating actions taken are summarised below:

1. Human Resources Risks 4. Financial Risks measures of exposure are accurate and g Succession planning and talent g The Company utilises various in-line with the needs of its businesses. development programmes are continually financial instruments, where appropriate, reviewed to ensure that our best to hedge against foreign exchange and g The Company monitors its exposure performing employees are motivated interest rate risks. in each country on a regular basis to stay and grow with the Company. and ensures all project investments g The Company ensures that adequate are in compliance with the capital g Localisation of key overseas positions funding resources are available for allocation policy. has started in several business units to investments and manages cash attract and retain local talent. flows actively. 8. Changing Consumer Demand Risks 2. Regulatory and Political Risks 5. Investment Risks g The Company strives to be g The Company continues to engage g To improve the quality of information a market leader in its product external legal and real estate consultants in feasibility studies, the Company has designs and finishes. There is close at early stages of project development staff dedicated to building and collaboration between the various for advice on local laws and changing maintaining a centralised information departments on introducing regulations. system for easy retrieval and sharing innovations and to ensure that a of information. balanced approach is taken. g The Company will maintain close working relationships with business g The Company continues to engage g Market trends are monitored associates and government officials external advisors to supplement in-house constantly via visits to new property in the various cities and countries it expertise in the due diligence process. launches and contact with real operates to anticipate possible changes estate practitioners. in government policies and regulations. 6. Business Continuity Risks g Business continuity plans are 9. Project Management Risks 3. Real Estate Market Risks developed to ensure that business g Keppel Land prides itself on its high g The Company continues with units can respond effectively to quality and timely delivery of projects. its investment strategy to focus on disruptive events. Ground teams carry out quality acquiring and developing projects inspection and manage contractors in countries where the economic g Staff in Singapore and overseas effectively. The Company also uses fundamentals are strong and the continue to receive training on the IT systems to track and monitor the political environment is relatively stable. business continuity programme. rectification of defects. g The Company has taken proactive 7. Capital Allocation Risks g The Company has put in place efforts to engage both existing and new g The Company reviews its capital monitoring processes and systems tenants to ensure their satisfaction and allocation policy to ensure that exposure to keep updated on cost increases increase office buildings’ occupancies. limits are current and relevant, and to better manage cost escalation.

Sustaining Growth Risk Management 143 Sustaining Growth Environment

The Company Keppel Land is committed to develop RECOGNITION FOR takes a proactive properties that harmonise with the SUSTAINABILITY EFFORTS approach towards environment and enhance the quality In recognition of its sustainable environmental of life of those living and working business practices and green efforts, in them. Keppel Land won the Merit Award management (Services category) for the Singapore and protection. In 2007, the Company established Environmental Achievement Awards an Environment Management 2010 organised by the Singapore Committee (EMC) to implement Environment Council. It was also a environmental programmes and fi nalist at the ACCA Singapore Awards monitor their progress. Guided for Sustainability Reporting 2010. by the Company’s environmental policy, objectives and targets, the In recognition of its corporate social Committee is focused on the fi ve responsibility (CSR) efforts, Keppel Land main thrusts of eco-initiatives for was included in the Dow Jones Asia new projects and existing buildings, Pacifi c Sustainability Index, putting it on ISO14001 certifi cation, as well as the radar screen of socially-responsible Eco-offi ce and environmental funds. The Company is also featured in outreach programmes. The Sustainability Yearbook 2011, the only Singapore real estate company Keppel Land believes in nurturing to be included. talents and is committed to building in-house capabilities in green building Keppel Land’s sustainability efforts designs. To date, the Company has were also featured in Singapore trained 37 Green Mark Managers Compact’s book, “Socially and seven Green Mark Facilities Responsible and Sustainable Managers, of which four are also – Company Perspectives and Green Mark Professionals and Experiences”, which was launched another a Singapore Certifi ed at the International Singapore Energy Manager. Compact CSR Summit 2010.

Keppel Land Limited 144 Report to Shareholders 2010 BCA GREEN MARK AWARDS energy consumption of about In the annual audit conducted in The Building and Construction 59 million kWh annually, which is September 2010, Keppel Land was Authority (BCA) Green Mark Scheme suffi cient to power more than 10,000 commended for its efforts in partnering is an initiative to move the Singapore 5-room fl ats for a year. In terms of contractors to reduce the project’s construction industry towards more greenhouse gases, these projects environmental impact and environmentally-friendly buildings. will prevent 29,000 tonnes of carbon minimise pollution. Under the Scheme, buildings are dioxide from being emitted annually. assessed and rated for energy and ECO-OFFICE PROGRAMME water effi ciency, indoor environmental For its existing investment buildings in Keppel Land recognises the importance quality, environmental protection, and Singapore, Keppel Land has achieved of energy conservation, water the adoption of other green features. the Green Mark Gold award. Energy conservation and waste minimisation, To demonstrate its commitment service companies were engaged to and had embarked on an Eco-offi ce towards environmental sustainability, perform energy audits to assess the programme for its corporate offi ce Keppel Land has set the goal to building’s energy consumption and since 2008. achieve at least the Green Mark Gold recommend energy-saving measures. rating or its equivalent for all new The Company has implemented Keppel Land was re-certifi ed as development projects, both energy-effi cient systems and an Eco-offi ce by the Singapore locally and overseas. environmentally-friendly features Environment Council for 2011–2013. for some investment buildings, and In 2010, Keppel Land achieved four will progressively introduce them to In its continual efforts towards BCA Green Mark Gold Awards for properties overseas. reducing paper usage, the Company existing investment buildings, namely, encourages staff to reuse and recycle Prudential Tower, Equity Plaza, Keppel Land also seeks to promote paper. In 2010, 16,000 kg of paper Keppel Towers and GE Tower, as well environmentally-friendly practices waste was recycled. as Keppel Bay Tower. Bugis Junction among its tenants. Regular events are Towers also received the Green Mark held to build rapport with tenants. The Company consumed about Gold award in January 2011. Some of The Company is developing a green 533,000 kWh of electricity in 2010. the green features incorporated in these guide to help tenants and homeowners Energy usage per gross fl oor area buildings include energy-effi cient air- understand green building features and remains relatively constant at about conditioning system, motion sensors, adopt green living lifestyles. 105 kWh/sm in 2009 and 2010, carpark CO sensors, and water-effi cient despite the increase in work activities. fi ttings. To date, Keppel Land has ISO14001 CERTIFICATION Paper usage dropped almost 3% received 23 BCA Green Mark awards, Keppel Land identifi es and mitigates and toner usage reduced by 10%. including a Platinum award for signifi cant environmental aspects of its These positive results were due to Ocean Financial Centre (OFC) and activities and services through setting the successful implementation of a GoldPLUS award for Marina Bay objectives and targets, establishing the eco-offi ce programme. Financial Centre (Phase 2). management programmes and procedures. The Company was GREEN ACCOLADES OFC is the fi rst offi ce development in awarded the ISO14001:2004 In November 2010, OFC was Singapore’s Central Business District certifi cation in 2008 for its Singapore conferred the Solar Pioneer Award to achieve the Green Mark Platinum property development operations. for its contribution towards a award, as well as the fi rst high-rise The certifi cation scope was extended sustainable future. The award was offi ce building in Southeast Asia to in 2009 to include overseas property bestowed jointly by the Singapore achieve the LEED-CS (core and shell) development operations in China Business Federation, Sustainable Platinum pre-certifi cation award. and Vietnam. Energy Association of Singapore, Economic Development Board and Projects that are Green Mark In 2010, Keppel Land continued to the Energy Market Authority. Gold-certifi ed will be about 15% maintain its Environmental Management more energy-effi cient than a typical System (EMS), covering more projects Keppel Land works closely with code-compliant building. Upon in China and Vietnam. The Company Audubon International, a global completion of all its Green Mark works closely with contractors to environmental organisation which certifi ed projects, the Company will infl uence and guide them to conform champions wildlife protection and see an estimated reduction in total to Keppel Land’s EMS requirements. conservation of natural resources.

Sustaining Growth Environment 145 Environment

In 2010, Spring City Golf & Lake Resort adopting a holistic view through an Exhibitions were held at the lobbies in Kunming, China as well as Ria Bintan integrated multi-disciplinary approach of K-REIT Asia’s offi ce buildings Golf Club in Bintan Island, Indonesia for each development. to raise awareness about recycling attained the prestigious Audubon and copies of the National Environment Classic Sanctuary certifi cation. In its continual efforts to seek Agency’s Waste Minimisation Tianjin Pearl Beach International quality designs in terms of energy Guidebook were distributed Country Club, another of Keppel Land’s performance, the Company is also to tenants. development, was the fi rst in the world exploring to adopt an integrated design to be recognised as an Audubon approach for new projects, an initiative An eco-walk was also held Classic Sanctuary in 2009. that integrates energy effi ciency from for employees and their families the start, where the greatest impact at the Sungei Buloh Wetland SETTING TARGETS can be attained. Reserve, Singapore’s fi rst ASEAN Keppel Land encourages its consultants Heritage Park. In addition, the and contractors to adopt green measures ENVIRONMENTAL OUTREACH Company organised a lunch-time or initiatives that complement its green In line with Keppel Land’s green talk by the Singapore Environment efforts to reap the benefi ts of sustainable efforts, 148 trees were transplanted Council on climate change. development practices. from one estate corner to another at Central Park City in Wuxi, China. Other eco activities held for Keppel Land will continue to devote Carried out over a three-month period staff include a workshop by resources, adopt best practices, and from May 2010, this eco-friendly Dr Hauschka, an award-winning introduce proven environmentally- initiative yielded savings of RMB60,000. Green skin-care line, eco-bazaars in friendly designs and processes that support of green retailers and social prevent pollution and other adverse On World Environment Day in June enterprises and visits to Singapore impact to the environment. 2010, Keppel Land sponsored the Garden Festival and the Bollywood screening of a documentary fi lm, Veggies organic farm. With tenants’ energy usage “Earth”, to engage staff, tenants and accounts for more than half of a guests. Featuring rare footages of In September 2010, Keppel Land commercial building’s total energy nature’s wildest and most elusive participated in a buggy race at consumption, Keppel Land believes animals, such as polar bears, African the Green1 (G1) Race organised by that collaboration between building elephants and humpback whales, the the SIngapore Environment Council owner and tenants in a building’s fi lm recorded a year in the life of Earth. to help spread the green message. ongoing operations is critical in achieving positive long-term During Earth Hour in March, tenants The Group was a Platinum Sponsor environmental outcomes. at Keppel Land’s commercial of the International Skyrise Greenery The Company plans to work with properties in Singapore, Vietnam and Conference held in November 2010. various stakeholders, including Indonesia participated by switching It also supported Southeast Asia’s tenants, to bring about greater off lights to conserve energy. premier eco-expo, Build Eco Xpo environmental performance of (BEX Asia), as the Gold Sponsor. commercial buildings. Keppel Land’s staff also observed Earth Hour at home with candles Please refer to Keppel Land’s In terms of sustainable design and made by ChaCha Cottage, an Sustainability Report 2010 for more development, Keppel Land believes organisation which supports women details on its environmental efforts in early and effi cient planning and in fi nancial need. and performance.

Keppel Land Limited 146 Report to Shareholders 2010 1 2

1_An eco-walk was held for employees and their families at the Sungei Buloh Wetland Reserve, Singapore’s ﬁ rst ASEAN Heritage Park.

2_Keppel Land’s staff were encouraged to observe Earth Hour at home.

Sustaining Growth Environment 147 Empowering Lives Health and Safety

A safety culture Keppel Land recognises that health and quarter. It has also been incorporated inspires and safety (H&S) is an integral part of its as a Key Performance Indicator (KPI) motivates business operations. Great emphasis has for staff appraisal, further reinforcing employees to been placed on cultivating an instinctive employees’ commitment to uphold high culture where employees take pride in safety standards, which is one of the care for self promoting a safe working environment. eight core values of the Keppel Group. and others to achieve a zero CULTIVATING AN INSTINCTIVE Comprising of four independent harm workplace. SAFETY CULTURE directors, the Board Safety Committee In striving for a zero-incident workplace, (BSC) ensures compliance with the a Workplace Safety and Health Unit Company’s H&S policy and monitors its was established in February 2011, headed effectiveness in assimilating the safety by a Director of Safety and Health. culture among employees. Assessing The unit is responsible for implementing the safety management system regularly, and overseeing policies to raise safety the BSC ensures that the Company’s standards in Keppel Land’s operations. H&S standards are aligned with industry best practices. Monthly reports are Championing a top-down approach, submitted to the BSC for evaluation and a safety policy signed off by the Group the committee meets quarterly to assess CEO is shared among all employees and safety practices that may have strategic, guidelines on H&S matters are made business and reputation implications readily accessible on the Company’s on the Company. The Management intranet. New staff will undergo a safety Safety Committee supports the initiation programme as part of the BSC in spearheading initiatives and orientation where they are introduced formulating policies and guidelines to the Company’s H&S guidelines. on workplace safety.

Committed to quality H&S standards, Safety management starts from safety takes ﬁ rst priority on the agenda the earliest concept development for the Board of Directors’ meetings every stages of a project through design,

Keppel Land Limited 148 Report to Shareholders 2010 construction and management. overseas projects. With the slogan Rigorous assessments are conducted “Stop, Think and Plan”, the campaign to identify potential hazards and risks highlighted the importance on how a involved. Controls and corrective few minutes of reﬂ ection could help measures are put in place to eliminate ensure a job is done safely. and minimise these exposures. Awareness talks were also conducted As it is a requirement to submit timely at construction sites to propagate the 5 reports and statistics on accident safety message. A series of sharing KEY frequency and severity rates at sessions with contractors were also PRINCIPLES construction sites, accidents and near held to address safety concerns. During misses are thoroughly investigated and the year, Keppel Land also conducted FOR SAFETY closely monitored by top management. a worksite grading for all projects in To prevent recurrence, lessons learnt Singapore. Contractors with excellent are shared with various business units. safety records were recognised at the If Safety is An online safety non-conformance Annual Contractors and Consultants reporting system was also implemented H&S Meeting in October. The meeting Expensive, in 2011 to improve on the existing focused on proper identiﬁ cation and Disasters reporting structure. prevention of common safety lapses. Cost More

Keppel Land believes in working with Ensuring continuous improvement in contractors and suppliers who share its H&S regime, DuPont, a global leader its commitment to high H&S standards. in safety consulting, was engaged Passion A set of stringent criteria is adopted in to assess the Company’s systems. for Health, selecting contractors for all projects. A Safety Perception Survey was Safety and Signifi cant efforts are channelled into conducted for all employees and its Environment strengthening the safety culture among contractors in January 2011. An Excellence contractors which include weekly online safety quiz that forms part management walkabouts and monthly of the employees’ appraisal was third-party audits at construction sites. also conducted for the second Shortcomings are highlighted and consecutive year in 2010 with Value records are kept for subsequent reviews. full participation by staff. A safety Everyone’s The safety team also springs surprise self-assessment programme starting Safety visits to sites to ensure consistency in from March through June 2011 will safety standards. allow the Company to streamline its safety administration and chart its A partner under the Workplace safety progression. Zero Tolerance Safety and Health (WSH) Council’s for Incidents bizSAFE programme, Keppel Land To inculcate a safety-fi rst mindset encourages participation in safety among employees, the Hazard initiatives and to meet standards Identifi cation and Risk Assessment set by the council. These include training session was conducted for Recognise Safe implementing risk and WSH staff based overseas. The management Behaviours management systems to reduce and safety team also attended the Felt injuries and illnesses, which will in Leadership Training which aims to align turn cut costs that will arise from these vision, principles and thrusts between incidents. The Company aims to help various business units, and impart its contractors achieve the bizSAFE principles for effective leadership in Level 3 standards by 2012. safety standards.

RAISING SAFETY AWARENESS Please refer to Keppel Land’s Keppel Land launched the “Take 3” Sustainability Report 2010 for more campaign covering its Singapore and details on its H&S efforts.

Empowering Lives Health and Safety 149 Empowering Lives People

Keppel Land Keppel Land is committed to upholding constant monitoring and maintenance is committed the core value of people-centredness. of employees’ skill sets. to develop a The Company manages and motivates motivated and the employees so as to build a In 2010, enhancements were made sustainable talent pipeline, placing great to the performance management united people emphasis on learning and development. framework to further strengthen the to drive further focus on performance and keep up with growth. MOTIVATING HIGH PERFORMANCE best practices in the industry. Greater Keppel Land fosters a performance- emphasis is also given to on-the-job based reward work culture to build demonstration of the Company’s core a motivated workforce. values. The “Hall of Fame” Awards, introduced in February 2011, is a special Under the Company’s performance award given to employees who exhibit management approach, compensation exemplary core values behaviour. includes a base salary commensurate with skills and experience, along with To further strengthen the linkage between an incentive bonus programme based reward and long-term performance, on individual performance. This is as well as to improve talent retention, reinforced through a performance Keppel Land introduced the Restricted management system, where employees Share Plan and Performance Share receive regular performance feedback Plan in 2010 to replace the Employee and career development reviews. Stock Option Plan.

Keppel Land has a structured A LEARNING ORGANISATION career-planning programme designed The Company understands the impact to promote professional growth. This of learning and development on programme serves as one of the main employee satisfaction and retention, communication channels between and invests in training to equip them management and employees, and also with the right skill sets needed in this as a direct feedback mechanism for rapidly changing work environment.

Keppel Land Limited 150 Report to Shareholders 2010 During the year, a series of employee Fresh graduates can opt to join communication sessions was conducted, as Management Associate (MA) with focusing on new learning and Keppel Land. This is a talent development development initiatives to enhance their programme that identiﬁ es and grooms understanding of the training opportunities future leaders. Three MAs were recruited available as well as to promote a in 2010. In addition, Keppel Land learning culture. participated in Nanyang Technological University Internship Fair during the year 8 New training roadmaps were launched. as part of the overall employer branding CORE A total of three “The Art of People effort. Eight internship positions were VALUES Management” workshops were held offered in 2010. during the year, two in Singapore and another in China. The inaugural INTERNAL COMMUNICATION workshop was conducted in Tianjin, AND ENGAGEMENT Passion as part of an off-site meeting. The Keppel Land conducts the workshop focused on empowering Organisational Climate Survey (OCS) managers with the right skills in on a yearly basis. OCS is a Group-wide coaching, leadership and performance annual survey on areas such as staff’s Integrity management. A cross-functional well-being, personal development training programme was designed and opportunities and overall work conducted for managers. Senior staff environment. This survey also serves from different functional units shared as an important feedback channel Customer Focus insights on their departments’ roles, for the Company to build an engaged challenges and interactions with workforce and improve its business other functions. and workplace performance. People-

TALENT DEVELOPMENT Regular informal platforms such as the centredness AND RECRUITMENT bi-monthly management-staff cocktail Consistent with the objective of receptions, monthly Heritage sessions building a sustainable talent pipeline, focusing on core values, and quarterly Safety Keppel Land runs a Leadership staff get-together during festive Development Programme (LDP) for seasons are organised. These sessions Emerging Leaders and Operational help to build team camaraderie, as well Leaders. LDP for Emerging Leaders as deepen a sense of belonging among Agility and was launched in 2009, targeted at Keppel Land’s employees. Innovativeness high potential executives. LDP for Operational Leaders was introduced The Mid-Week Chill Out session is a in 2010, aimed at identifying and new initiative introduced in response transiting people leaders to to employees’ feedback to have more Collective operational leaders. informal platforms for employee-level Strength interaction. Two such sessions were Targeted at high potential employees held in 2010, both of which were regardless of nationality, this structured well-received and attended. programme is an intensive one Accountability with focus on accelerating their A bi-monthly electronic newsletter development. All nominees, selected –Klink–was launched during the year by their Unit Head, go through a to deepen engagement with and stringent selection process with the among employees. In this newsletter, Talent Review Committee (TRC). interviews with senior management and Chaired by the Group CEO, the TRC colleagues overseas were featured. is made up of the divisional CEOs who meet periodically to review To reach out to its employees overseas, their performance. the Annual International Conference

Empowering Lives People 151 People

1 2

(AIC) was conducted in April 2010. During the year, new corporate In 2010, the Company was conferred Held over a fi ve-day period, workshops membership tie-ups with The Singapore the Gold award by the Health Promotion for management training and a career Flyer and Wild Wild Wet were added to Board at the Singapore H.E.A.L.T.H review session for overseas-based the current list of recreational places (Helping Employees Achieve Life-Time senior executives were organised as which include the Singapore Zoo, the Health) Awards ceremony. This is a part of the conference. The AIC will Jurong Bird Park, and the Singapore national recognition for Keppel Land as be re-positioned as the Annual Staff Science Centre. an organisation who puts employees’ Conference starting from 2011, for wellness as a corporate priority. overseas and Singapore-based Free annual health screening, senior executives. coaching lessons on badminton Keppel Land was also recognised and table-tennis as well as cooking for its efforts in human capital ADVOCATING A HEALTHY AND classes for healthy living were management at the Singapore Human BALANCED WORK-LIFE organised for staff. Health-related Resource Awards in 2010, receiving Keppel Land aims to create a workshops have been well received awards in the Corporate Social pro-family and engaging work by employees. During the year, Responsibility (Leading), Performance environment for its employees, experts were invited to conduct Management (Special Mention) and regularly enhances its benefi ts workshops on Enzymes and Digestion, and E-HR Management (Special provisions to help its employees strike Osteoporosis and Healthy Weight Mention) Categories. a balance between professional and at Work. personal commitments. Please refer to Keppel Land’s In addition, Keppel Land continued Sustainability Report 2010 for Besides having a fi ve-day work week to have corporate tie-up with the more details on its human capital since 2005, Keppel Land continues Clark Hatch Fitness Centre at management efforts and initiatives. to drive initiatives that promote family InterContinental Singapore for the cohesiveness such as organising 12th year running. Located at workshops on parenting skills and Bugis Junction where Keppel Land’s supporting national initiatives like Singapore headquarters is based, “Eat with Your Family Day” where easy access and proximity to the employees are encouraged to leave gym facilities provided convenience 1, 2_Work-life balance is a key early to dine with their families. to the employees. priority at Keppel Land.

Keppel Land Limited 152 Report to Shareholders 2010 Singapore HQ Educational Qualifications International Manpower Breakdown of employees (%) Distribution by professional category (%) (%)

Executive 78.7 Master’s Degree/ Singapore 14.8 Post Graduate 19.7 Non-Executive 21.3 China 36.3 Bachelor’s Degree/ Total 100.0 Professional Certification/ India 2.2 Graduate Diploma 50.3 Vietnam 12.7 Diploma/GCE ‘A’ Levels 15.2 Indonesia 17.9 GCE ‘O’ Levels/ The Philippines 0.7 Industrial Certification 9.1 Thailand 1.5 Others 5.7 Saudi Arabia 0.3 Total 100.0 Myanmar 13.6 Total 100.0

Singapore HQ Age Group Training Expenditure Distribution Breakdown of employees (%) (%) by gender (%)

Men 49.7 Less than 30 years 12.1 Conference 6.8 Women 50.3 From 30 years to 50 years 68.7 Industry-related and job- specific external courses 25.9 Total 100.0 More than 50 years 19.2 Skills Training 29.5 Total 100.0 Leadership Courses 37.8 Total 100.0

Empowering Lives People 153 Nurturing Communities Causes

Keppel Land aims Expanding its Corporate Social ‘Towards the ASEAN Community to achieve positive Responsibility (CSR) efforts beyond from Vision to Action’, outstanding and sustainable environmental initiatives, Keppel Land’s companies who had contributed outcomes for our Environment Management Committee signifi cantly to ASEAN’s economic is widening its scope to include growth and progress were honoured business, the community activities, particularly and recognised at the event. environment and in the area of education. To refl ect the community. the change, it will be renamed the SPIRIT OF STAFF VOLUNTEERISM CSR Committee. Keppel Land reaches out to the less-privileged through the MOST ADMIRED ASEAN Keppel Group volunteer movement, ENTERPRISE FOR CSR Keppel Volunteers. Since its inception Keppel Land was awarded the in 2000, Keppel Volunteers has been “Most Admired ASEAN Enterprise” spearheading regular activities which for Corporate Social Responsibility at make meaningful contributions to local the ASEAN Business Awards 2010. communities, social institutions and This is in recognition of Keppel Land’s non-profi t organisations. To encourage continual efforts in rolling out a diversity and support participation in charitable of programmes and activities that initiatives, staff are entitled to two days support the environment, education, of volunteerism leave each year. healthcare, the arts as well as philanthropic movements in Asia. On a monthly basis, Keppel Volunteers organises programmes and events to Into its third year, the annual ASEAN interact with and engage students from Business Awards was organised by its adopted charity, the Association for the ASEAN Business Advisory Council. Persons with Special Needs (APSN). Organised in conjunction with the At the Keppel Games 2010 held in 16th ASEAN Summit, the awards December where Keppel Volunteers ceremony took place in Hanoi, Vietnam, teamed up with APSN students in an in October 2010. In line with the theme assortment of games, a total sum of

Keppel Land Limited 154 Report to Shareholders 2010 $41,800 in pledges and sponsorships organised a lunchtime Christmas Marina Bay was adorned with was raised for APSN. bazaar in December 2010, featuring light sculptures which served as eco-friendly products and items educational tools, teaching the public STRONG ADVOCATE OF produced by socially-responsible on available alternative sources of THE ARTS AND CULTURE vendors as well as students energy creation. Supporting these Keppel Land supports another from APSN. initiatives were Keppel Land’s One Keppel Group initiative, Keppel Raffl es Quay and MBFC, which Nights. A joint collaboration with Apart from purchasing the goods, implemented a variety of energy-saving the Arts and Culture Development employees donated used leather bags measures, including switching off Offi ce of the Ministry of Information, to All Things Green and Beautiful, a some lighting around their façades. Communications and the Arts, this is local company that recycles unwanted Singapore’s fi rst ticket subsidy scheme items into accessories such as hair On 2 September 2010, His Excellency to enable fi rst-time goers and those bands, brooches and necklaces. Ambassador Nguyen Trung Thanh who cannot afford full-price ticket celebrated Vietnam’s 65th National Day purchases to enjoy the arts. Keppel Land donated $10,000 to the with Mr Lim Hng Kiang, Minister for second Handcycling Time-Trials/Sprint Trade and Industry, at the Refl ections Since its launch, the scheme has Race held in October 2010, organised at Keppel Bay show gallery. supported 150 shows. Over 12,500 by the Handcycling Association subsidised tickets have been offered, of Singapore. Handcycling is fast Guests from the diplomatic corps, benefi ting more than 11,000 people. gaining popularity as a serious sport, business world and the Vietnamese encouraging the disabled to go community, as well as Keppel Group’s Keppel Land supported two high beyond their perceived limitations senior management, attended the event profi le events – the 25th River Hongbao and cycle alongside able-bodied to offer their well wishes. and the Huayi Festival. Held from families and friends. 1–13 February 2011 at The Float@ Marina at Keppel Bay hosted the Marina Bay, the annual River Hongbao VIBRANT COMMUNITY Jewel of Muscat, a heritage vessel took place in conjunction with ACTIVITIES BY THE BAY which is a gift from the Sultanate the Lunar New Year featuring In support of the inaugural Youth of Oman to Singapore, when it sailed performances and a bazaar. Olympics Games’ (YOG) opening in on 3 July 2010. Keppel Group ceremony on 14 August 2010, was one of the main sponsors of This is the second consecutive year Keppel Land’s iconic Grade A offi ce the Jewel of Muscat, as well as the that Keppel Land has supported the buildings Ocean Financial Centre and venue sponsor. festive event. The event was graced by Marina Bay Financial Centre (MBFC), dignitaries including Minister Mentor switched on their building façade The marina also played host Lee Kuan Yew, who offi ciated the lights together with other prominent to Sinterklaas and his helpers opening, as well as Prime Minister buildings to showcase Marina Bay’s Black Peters who arrived on Lee Hsien Loong. signature skyline. 20 November 2010 by boat, as part of the Dutch winter holiday celebrations Keppel Land continued to sponsor After an intense 21-day journey around organised by the Hollandse Club for the Huayi Festival in 2010 and 2011, the world which started from Athens the Dutch expatriate community in an annual event which celebrates to Singapore, the Youth Olympic Flame Singapore. In December 2010, a traditional and contemporary Chinese passed through the Promontory@ special reception was held at the arts. 2011 saw noteworthy theatre Marina Bay on 13 August 2010. Marina by the Keppel Group to performance such as Red Rose Keppel Group and its joint venture celebrate the haul of eight medals White Rose by the National Theatre of partners were represented as one by the Singapore Sailing team at China as well as concerts by popular of the torch-bearers at the event. the 2010 Asian Games. homegrown singer Kit Chan. MBFC was also one of the sponsors of the YOG. MAKING EDUCATION ACCESSIBLE LENDING SUPPORT Keppel Land believes in investing TO GOOD CAUSES Keppel Land participated in the in talent and nurturing exceptional As part of its environmental iLight Marina Bay Light Festival, Asia’s young people, and has awarded a outreach programme, Keppel Land’s fi rst-ever sustainable light art event. total of 25 scholarships over Environment Management Committee From 15 October to 7 November 2010, the years.

Nurturing Communities Causes 155 Causes

1 2

In January 2010, Keppel Land by sponsoring foreign volunteer Between March and May 2010, participated in the Built Environment doctors who provided healthcare Keppel Land hosted business Scholarships Career Fair organised services to local villagers. Spring City delegates from Brazil and Egypt, by the Building and Construction partnered a group of Singaporean as well as students from the University Authority (BCA). A student from the doctors and nurses on a voluntary of Southern California. In celebration National University of Singapore was medical mission to perform cataract of Children’s Day in Indonesia, Keppel awarded the Keppel Land-BCA surgery on villagers who cannot Land contributed bags and towels to Built Environment Scholarship. afford or are too weak to travel to Asrama St Theresa, a boarding school the nearest city for treatment. run by nuns on Rempang Island, Keppel Land also offers the off Batam, in November 2010. Keppel-SJI International Scholarship To date, the resort has sponsored to groom talented students from more than RMB200,000 and about For more details on Keppel Land’s Vietnam and India. Scholars under 150 patients have benefi ted from community efforts, please refer to this programme are given the the cause. Funds have also been its Sustainability Report 2010. opportunity to live and study in partially raised through charity Singapore under the International golf events. Baccalaureate (IB) Diploma curriculum. Keppel Land donated RMB500,000 CARING FOR OVERSEAS to the relief fund set up by the local COMMUNITIES authorities in the Jingan District, Keppel Land cares for and actively Shanghai, in aid of families who gives back to the communities in were victims of a fi re disaster. 1_Keppel Volunteers teamed the cities it has a presence in. The fi re of 15 November 2010 up with APSN students for a set ablaze a 28-storey tower in series of fund-raising games at Keppel Games 2010. Spring City Golf & Lake Resort Shanghai which was reported (Spring City) in Kunming, China, to be home to some 440 people 2_Spring City sponsors healthcare services for the continued its support for the locals in 156 households. locals in Kunming, China.

Keppel Land Limited 156 Report to Shareholders 2010 Directors’ Report & Financial Statements

Contents 158 Directors’ Report 166 Statement by Directors 167 Independent Auditors’ Report 168 Consolidated Profit and Loss Account 169 Consolidated Statement of Comprehensive Income 170 Balance Sheets 171 Statements of Changes in Equity 174 Consolidated Cash Flow Statement 176 Notes to the Financial Statements 240 Significant Subsidiary and Associated Companies 245 Corporate Information 246 Profile of Directors and Senior Management 253 Calendar of Financial Events 254 Corporate Structure 258 Property Portfolio 276 Statistics of Shareholdings 278 Notice of Annual General Meeting 284 Share Transaction Statistics Proxy Form

157 Directors’ Report For the financial year ended 31 December 2010

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 for the financial year ended 31 December 2010.

1. Directors

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

Choo Chiau Beng, Chairman Kevin Wong Kingcheung, Group Chief Executive Officer Khor Poh Hwa Lim Ho Kee Tsui Kai Chong Lee Ai Ming Tan Yam Pin Heng Chiang Meng Edward Lee Kwong Foo Koh-Lim Wen Gin Teo Soon Hoe Oon Kum Loon (Appointed on 1 September 2010)

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

Holdings At 01.01.2010/ Date of Appointment 31.12.2010 21.01.2011

The Company Ordinary shares Choo Chiau Beng 100,000 102,204 102,204 Kevin Wong Kingcheung 2,351,894 2,821,170 2,821,170 Edward Lee Kwong Foo 137,148 137,148 137,148

Share options Kevin Wong Kingcheung 1,038,552 669,276 669,276

Contingent award of restricted shares to be delivered after 2010 (1) Kevin Wong Kingcheung - 70,000 70,000

Contingent award of performance shares to be delivered after 2012 (2) Kevin Wong Kingcheung - 200,000 200,000

Keppel Corporation Limited Ordinary shares Choo Chiau Beng 1,631,666 2,321,666 2,321,666 Choo Chiau Beng (Deemed interest) 200,000 200,000 200,000 Lim Ho Kee (Deemed interest) 30,000 30,000 30,000 Tan Yam Pin (Deemed interest) 120,000 120,000 120,000 Teo Soon Hoe 3,628,332 4,088,332 4,088,332 Oon Kum Loon 49,000 49,000 49,000 Oon Kum Loon (Deemed interest) 40,000 40,000 40,000

Keppel Land Limited 158 Report to Shareholders 2010 Holdings At 01.01.2010/ Date of Appointment 31.12.2010 21.01.2011

Keppel Corporation Limited (continued) Share options Choo Chiau Beng 2,150,000 1,770,000 1,770,000 Teo Soon Hoe 2,760,000 2,530,000 2,530,000

Contingent award of restricted shares to be delivered after 2010 (1) Choo Chiau Beng - 150,000 150,000 Teo Soon Hoe - 100,000 100,000

Contingent award of performance shares to be delivered after 2012 (2) Choo Chiau Beng - 300,000 300,000 Teo Soon Hoe - 200,000 200,000

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

K-REIT Asia Units Choo Chiau Beng - 2,635,000 2,635,000 Choo Chiau Beng (Deemed interest) 2,635,000 - - Kevin Wong Kingcheung 2,888,976 2,888,976 2,888,976 Lim Ho Kee (Deemed interest) 400,000 400,000 400,000 Tsui Kai Chong (Deemed interest) 200,000 200,000 200,000 Lee Ai Ming 460,000 460,000 460,000 Tan Yam Pin (Deemed interest) 100,000 100,000 100,000

Keppel Telecommunications & Transportation Ltd Ordinary shares Teo Soon Hoe 28,000 28,000 28,000

Keppel Philippines Holdings Inc “B” shares of 1 Peso each Choo Chiau Beng 2,000 2,000 2,000 Teo Soon Hoe 2,000 2,000 2,000

Notes: 1. Depending on the achievement of pre-determined performance targets, the actual number of shares to be released can be zero or the numbers stated.

2. Depending on the achievement of pre-determined performance targets, the actual number of shares to be released can range from zero to 150% of the numbers stated.

Directors’ Report 159 Directors’ Report

1. Directors (continued)

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, except as disclosed in the notes to the financial statements.

Neither at the end of the financial year, nor at any time during the year, did there subsist any arrangement, 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, Keppel Land Restricted Share Plan and Keppel Land Performance Share Plan approved previously by shareholders at Extraordinary General Meetings.

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:

Lim Ho Kee Tsui Kai Chong Tan Yam Pin Heng Chiang Meng Oon Kum Loon

2. Share Options of the Company

The particulars of the share options of the Company are as follows:

(a) At the Extraordinary General Meeting of the Company held on 23 April 2010, the Company’s shareholders approved the adoption of two new share plans, with effect from the date of termination of the Keppel Land Share Option Scheme (“the Scheme”). The Scheme was terminated on 30 June 2010. Options granted and outstanding prior to the termination will continue to be valid and subject to the terms and conditions of the Scheme.

(b) Details of share options granted under the Scheme are disclosed in Note 12 to the financial statements.

(c) Pursuant to Rule 12(a)(iv) of the Scheme, the number and the exercise price of those share options granted prior to 12 June 2009 have been adjusted for the effects of the Company’s rights issue in 2009.

Keppel Land Limited 160 Report to Shareholders 2010 (d) Options to take up 960,750 shares were granted to senior employees during the financial year. Altogether 1,197,827 shares were issued by virtue of the exercise of options, and options to take up 176,900 shares were cancelled during the financial year. At the end of the financial year, there were 5,551,871 shares under option as follows:

Number of Share Options Exercise Price Date of At 01.01.10 or Cancelled/ (Adjusted for Value of Grant Date of Grant Exercised Lapsed At 31.12.10 Expiry Date Rights Issue) ($) Options ($)

06.04.00 34,022 (34,022) - - 05.04.10 1.60 0.9004 14.11.00 36,928 (28,157) (8,771) - 13.11.10 2.11 1.2030 11.10.01 23,463 (9,385) - 14,078 10.10.11 1.16 0.6185 07.08.02 17,598 - - 17,598 06.08.12 1.23 0.6407 09.12.05 152,514 (152,514) - - 08.12.15 2.03 1.0830 09.12.05 319,694 (319,694) - - 08.12.15 2.62 1.4397 08.02.06 401,818 (284,499) - 117,319 07.02.16 3.33 1.3620 10.08.06 478,075 (208,242) - 269,833 09.08.16 3.47 1.3894 27.11.07 554,333 - - 554,333 26.11.17 6.81 2.6404 27.11.07 554,332 - - 554,332 26.11.17 6.86 2.5801 12.02.08 653,467 - - 653,467 11.02.18 5.03 1.5354 13.08.08 844,111 (161,314) - 682,797 12.08.18 3.76 1.1161 04.02.09 965,243 - (38,129) 927,114 03.02.19 1.19 0.3305 05.08.09 930,250 - (65,000) 865,250 04.08.19 2.67 0.8940 5,965,848 (1,197,827) (111,900) 4,656,121 08.02.10 960,750 - (65,000) 895,750 07.02.20 3.37 1.1840 6,926,598 (1,197,827) (176,900) 5,551,871

(e) The information on Directors of the Company participating in the Scheme is as follows:

Aggregate Number Aggregate Number of Options of Options Granted Since Exercised Since Aggregate Number Commencement of Commencement of of Options Options Granted the Scheme to the Scheme to Outstanding as During the the End of the the End of at the End of Name of Director Financial Year Financial Year the Financial Year the Financial Year

Kevin Wong Kingcheung 100,000 2,902,360 1,978,676 669,276

(f) There are no options granted to any of the Company’s controlling shareholders or their associates under the Scheme.

Directors’ Report 161 Directors’ Report

3. Share Plans Of the Company

The particulars of the share plans of the Company are as follows:

(a) The Keppel Land Restricted Share Plan (“KLL RSP”) and Keppel Land Performance Share Plan (“KLL PSP”) (collectively the “share plans”) were approved by the Company’s shareholders at the Extraordinary General Meeting of the Company on 23 April 2010.

(b) Details of the KLL RSP and KLL PSP are disclosed in Note 12 to the financial statements.

(c) The number of contingent shares granted were 886,000 under KLL RSP and 656,000 under KLL PSP during the financial year. No share was released under the KLL RSP and KLL PSP during the financial year. 12,000 shares under the KLL RSP were cancelled during the financial year. At the end of the financial year, there were 874,000 shares under KLL RSP and 656,000 shares under KLL PSP as follows:

Number of Shares At 01.01.10 or Date of Grant Date of Grant Adjustment Vested Cancelled At 31.12.10

KLL RSP (1) 30.06.10 886,000 - - (12,000) 874,000

KLL PSP (2) 30.06.10 656,000 - - - 656,000

(d) The information on Directors of the Company participating in the share plans is as follows:

Aggregate Awards Aggregate Awards Granted Since Released Since Contingent Commencement of the Commencement of the Aggregate Awards Awards Granted Share Plans to the Share Plans to the Not Released as at During the End of the End of the the End of the Name of Director Financial Year Financial Year Financial Year Financial Year

KLL RSP (1) Kevin Wong Kingcheung 70,000 70,000 - 70,000

KLL PSP (2) Kevin Wong Kingcheung 200,000 200,000 - 200,000

Notes: 1. Depending on the achievement of pre-determined performance targets, the actual number of shares to be released can be zero or the numbers stated. 2. Depending on the achievement of pre-determined performance targets, the actual number of shares to be released can range from zero to 150% of the numbers stated.

Keppel Land Limited 162 Report to Shareholders 2010 (e) There are no contingent award of shares granted to any of the Company’s controlling shareholders or their associates under the KLL RSP and KLL PSP.

(f) Other than Mr Kevin Wong Kingcheung who received 370,000 share options and contingent shares or 15 percent of the aggregate of the total share options under the Keppel Land Share Option Scheme and contingent award of shares under the KLL RSP and KLL PSP, no employee or Director received 5 percent or more of the total number of share options and contingent award of shares granted during the financial year.

4. Share Plans of a Subsidiary Company

K-REIT Asia Management Limited (“KRAM”), a wholly-owned subsidiary company of the Group, implemented a Restricted Unit Plan (“KRAM RUP”) and a Performance Unit Plan (“KRAM PUP”) (collectively the “unit plans”) for its key senior management and employees.

The particulars of the unit plans of KRAM are as follows:

(a) The KRAM RUP and KRAM PUP were approved and administered by the Nominating and Remuneration Committee of KRAM.

(b) KRAM is the manager of K-REIT Asia. The awards granted by KRAM will be settled in K-REIT Asia units. Details of the KRAM RUP and KRAM PUP are disclosed in Note 12 to the financial statements.

(c) The number of contingent units granted were 70,500 under KRAM RUP and 108,000 under KRAM PUP during the financial year. No unit was released under the KRAM RUP and KRAM PUP during the financial year. No unit under the KRAM RUP was cancelled during the financial year. At the end of the financial year, there were 70,500 units under KRAM RUP and 108,000 units under KRAM PUP as follows:

Number of Units At 01.01.10 or Date of Grant Date of Grant Adjustment Vested Cancelled At 31.12.10

KRAM RUP (1) 30.12.10 70,500 - - - 70,500

KRAM PUP (2) 30.12.10 108,000 - - - 108,000

Directors’ Report 163 Directors’ Report

4. Share Plans of a Subsidiary Company (continued)

(d) The information on Directors of KRAM participating in the unit plans is as follows:

Aggregate Awards Aggregate Awards Granted Since Released Since Contingent Commencement of the Commencement of the Aggregate Awards Awards Granted Unit Plans to the Unit Plans to the Not Released as at During the End of the End of the the End of the Name of Director Financial Year Financial Year Financial Year Financial Year

KRAM RUP (1) Ng Hsueh Ling 54,000 54,000 - 54,000

KRAM PUP (2) Ng Hsueh Ling 108,000 108,000 - 108,000

Notes: 1. Depending on the achievement of pre-determined performance targets, the actual number of units to be released can be zero or the numbers stated. 2. Depending on the achievement of pre-determined performance targets, the actual number of units to be released can range from zero to 150% of the numbers stated.

(e) There are no contingent award of units granted to any of the Company’s controlling shareholders or their associates under the KRAM RUP and KRAM PUP.

(f) Other than Ms Ng Hsueh Ling who received 162,000 contingent units or 91 percent of the contingent award of units under the KRAM RUP and KRAM PUP, no employee or Director of KRAM received 5 percent or more of the total number of units under the KRAM RUP and KRAM PUP granted during the financial year.

Keppel Land Limited 164 Report to Shareholders 2010 5. Audit Committee

The Audit Committee comprises three independent Directors, namely:

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 inter alia 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; − Carried out reviews 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 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.

6. 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

Choo Chiau Beng Kevin Wong Kingcheung Chairman Group Chief Executive Officer

Singapore, 22 February 2011

Directors’ Report 165 Statement by Directors For the financial year ended 31 December 2010

We, CHOO CHIAU BENG 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, consolidated statement of comprehensive income, 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 2010 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

Choo Chiau Beng Kevin Wong Kingcheung Chairman Group Chief Executive Officer

Singapore, 22 February 2011

Keppel Land Limited 166 Report to Shareholders 2010 Independent Auditors’ Report For the financial year ended 31 December 2010

To the members of Keppel Land Limited

Report on the Financial Statements We have audited the accompanying financial statements of Keppel Land Limited (“the Company”) and its subsidiary companies (collectively, “the Group”) set out on pages 168 to 244, which comprise the balance sheets of the Group and the Company as at 31 December 2010, the statements of changes in equity of the Group and the Company and the consolidated profit and loss account, consolidated statement of comprehensive income and consolidated 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 of financial statements that give a true and fair view in accordance with the provisions of the Singapore Companies Act (“the Act”) and Singapore Financial Reporting Standards, and for 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 accounts and balance sheets and to maintain accountability of assets.

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 about 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 judgment, 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 of the financial statements that give a true and fair view 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, 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 the Company as at 31 December 2010 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.

Report on Other Legal and Regulatory Requirements In our opinion, 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, 22 February 2011

Independent Auditors’ Report 167 Consolidated Profit and Loss Account For the financial year ended 31 December 2010

2010 2009 Note $’000 $’000

Sales 2 792,273 923,869 Cost of sales (472,405) (602,411)

Gross profit 319,868 321,458 Distribution costs (11,623) (11,473) Administrative and other expenses (85,318) (108,060)

Operating profit 222,927 201,925 Interest and investment income 4 29,746 34,528 Interest expense 5 (38,245) (41,217) Share of results of associated companies 19 176,379 164,203 Gain on acquisition of additional interest in an associated company 6 2,678 11,102 Corporate restructuring surplus 7 363,848 -

Pre-tax profit before fair value gain/(loss) on investment properties/impairment 757,333 370,541 Fair value gain/(loss) on investment properties/impairment 8 425,810 (11,977)

Pre-tax profit after fair value gain/(loss) on investment properties/impairment 1,183,143 358,564 Taxation 9 (122,558) (59,234)

Profit for the year 3 1,060,585 299,330

Profit attributable to: Shareholders of the Company 1 1,045,831 280,416 Non-controlling interests 1 14,754 18,914

1,060,585 299,330

Basic earnings per share (cents) based on: 11 Profit before fair value gain/(loss) on investment properties/impairment 44.6 22.6 Profit after fair value gain/(loss) on investment properties/impairment 72.8 24.2

Diluted earnings per share (cents) based on: 11 Profit before fair value gain/(loss) on investment properties/impairment 44.5 22.6 Profit after fair value gain/(loss) on investment properties/impairment 72.7 24.2

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Keppel Land Limited 168 Report to Shareholders 2010 Consolidated Statement of Comprehensive Income For the financial year ended 31 December 2010

2010 2009 $’000 $’000

Profit for the year 1,060,585 299,330

Other comprehensive income: Available-for-sale financial assets: Net fair value change 1,885 967 Fair value change transferred to profit and loss account (13) - Exchange difference on consolidation (59,456) (76,181) Exchange difference transferred to profit and loss account 163 (147) Share of other comprehensive income of associated companies (9,745) (5,594)

Other comprehensive income for the year, net of tax (67,166) (80,955)

Total comprehensive income for the year 993,419 218,375

Total comprehensive income attributable to: Shareholders of the Company 991,315 211,023 Non-controlling interests 2,104 7,352

993,419 218,375

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Consolidated Statement of Comprehensive Income 169 Balance Sheets As at 31 December 2010

Group Company 2010 2009 2010 2009 Note $’000 $’000 $’000 $’000

Share capital 12 2,061,020 1,987,542 2,061,020 1,987,542 Reserves 13 2,240,251 1,388,247 960,157 874,427

Share capital and reserves 4,301,271 3,375,789 3,021,177 2,861,969 Non-controlling interests 339,051 412,813 - -

Total equity 4,640,322 3,788,602 3,021,177 2,861,969 Long-term borrowings 14 2,199,669 903,570 1,298,436 345,925

6,839,991 4,692,172 4,319,613 3,207,894

Represented by: Fixed assets 15 206,595 227,838 42 47 Investment properties 16 1,699,840 1,404,992 - - Amounts owing by associated companies 17 446,161 940,708 - - Investments Subsidiary companies 18 - - 1,272,995 1,288,681 Associated companies 19 1,419,842 1,432,449 101,861 147,837 Long-term investments 20 111,338 67,884 7,254 6,221 1,531,180 1,500,333 1,382,110 1,442,739

Current assets Properties held for sale 21 2,125,362 1,151,994 - - Stocks 22 3,265 3,692 - - Debtors 23 586,753 295,208 4,828 3,896 Amounts owing by holding company and related parties 24 135,269 134,301 3,306,065 2,221,828 Cash and cash equivalents 25 1,589,046 892,711 354 272,053 4,439,695 2,477,906 3,311,247 2,497,777 Less: Current liabilities Creditors 26 894,197 715,188 50,977 37,050 Tax provision 9 166,503 155,199 9,976 6,930 Short-term borrowings 27 316,792 823,153 302,536 618,000 Amounts owing to holding company and related parties 24 3,167 67,542 5,240 67,069 1,380,659 1,761,082 368,729 729,049

Net current assets 3,059,036 716,824 2,942,518 1,768,728

Deferred taxation 9 (102,821) (98,523) (5,057) (3,620)

6,839,991 4,692,172 4,319,613 3,207,894

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Keppel Land Limited 170 Report to Shareholders 2010 Statements of Changes in Equity For the financial year ended 31 December 2010

Foreign Currency Non- Share Capital Translation Revenue controlling Total Capital Reserves Account Reserves Total Interests Equity $’000 $’000 $’000 $’000 $’000 $’000 $’000

GROUP Balance at 1 January 2010 1,987,542 50,220 (12,718) 1,350,745 3,375,789 412,813 3,788,602 Total comprehensive income for the year Profit for the year - - - 1,045,831 1,045,831 14,754 1,060,585 Other comprehensive income - 113 (54,629) - (54,516) (12,650) (67,166)

Total comprehensive income for the year - 113 (54,629) 1,045,831 991,315 2,104 993,419

Transactions with equity holders, recorded directly in equity Issue of shares (see Note 12) Under the Dividend Reinvestment Scheme 70,078 - - - 70,078 - 70,078 Under the Keppel Land Share Option Scheme 3,550 - - - 3,550 - 3,550 Share issuance expenses (see Note 12) (150) - - - (150) - (150) Cost of share-based payments - 3,099 - - 3,099 - 3,099 Capital contribution - - - - - 40,523 40,523 Acquisition of non-controlling interests (see Note 18) - (40,031) - - (40,031) (74,347) (114,378) Dividend paid (see Note 10) Cash - - - (44,351) (44,351) (42,042) (86,393) Shares - - - (70,078) (70,078) - (70,078) Transfer from translation reserves to revenue reserves - - (184) 184 - - - Transfer from capital reserves to revenue reserves - (2,110) - 2,110 - - - Issue of convertible bond - equity component (see Note 14) - 12,050 - - 12,050 - 12,050

Total transactions with equity holders 73,478 (26,992) (184) (112,135) (65,833) (75,866) (141,699)

Balance at 31 December 2010 2,061,020 23,341 (67,531) 2,284,441 4,301,271 339,051 4,640,322

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Statements of Changes in Equity 171 Statements of Changes in Equity

Foreign Currency Non- Share Capital Translation Revenue controlling Total Capital Reserves Account Reserves Total Interests Equity $’000 $’000 $’000 $’000 $’000 $’000 $’000

GROUP Balance at 1 January 2009 1,188,479 66,570 59,264 1,128,247 2,442,560 454,374 2,896,934 Total comprehensive income for the year Profit for the year - - - 280,416 280,416 18,914 299,330 Other comprehensive income - 2,589 (71,982) - (69,393) (11,562) (80,955)

Total comprehensive income for the year - 2,589 (71,982) 280,416 211,023 7,352 218,375

Transactions with equity holders, recorded directly in equity Issue of shares (see Note 12) Under the rights issue 707,612 - - - 707,612 - 707,612 Under the Dividend Reinvestment Scheme 46,361 - - - 46,361 - 46,361 Under the Keppel Land Share Option Scheme 110 - - - 110 - 110 To acquire remaining shares in Evergro Properties Limited 52,161 - - - 52,161 - 52,161 Share issuance expenses (see Note 12) (7,181) - - - (7,181) - (7,181) Cost of share-based payments - 1,941 - - 1,941 - 1,941 Capital contribution - - - - - 25,080 25,080 Acquisition of non-controlling interests - (21,364) - - (21,364) (34,610) (55,974) Dividend paid (see Note 10) Cash - - - (11,344) (11,344) (39,383) (50,727) Shares - - - (46,361) (46,361) - (46,361) Deferred tax adjustment for equity component of convertible bond - 271 - - 271 - 271 Transfer from revenue reserves to capital reserves - 213 - (213) - - -

Total transactions with equity holders 799,063 (18,939) - (57,918) 722,206 (48,913) 673,293

Balance at 31 December 2009 1,987,542 50,220 (12,718) 1,350,745 3,375,789 412,813 3,788,602

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Keppel Land Limited 172 Report to Shareholders 2010 Share Capital Revenue Total Capital Reserves Reserves Equity $’000 $’000 $’000 $’000

COMPANY Balance at 1 January 2010 1,987,542 46,036 828,391 2,861,969 Total comprehensive income for the year Profit for the year - - 183,977 183,977 Other comprehensive income - 1,033 - 1,033

Total comprehensive income for the year - 1,033 183,977 185,010

Transactions with equity holders, recorded directly in equity Issue of shares (see Note 12) Under the Dividend Reinvestment Scheme 70,078 - - 70,078 Under the Keppel Land Share Option Scheme 3,550 - - 3,550 Share issuance expenses (see Note 12) (150) - - (150) Cost of share-based payments - 3,099 - 3,099 Dividend paid (see Note 10) Cash - - (44,351) (44,351) Shares - - (70,078) (70,078) Issue of convertible bond - equity component (see Note 14) - 12,050 - 12,050

Total transactions with equity holders 73,478 15,149 (114,429) (25,802)

Balance at 31 December 2010 2,061,020 62,218 897,939 3,021,177

Balance at 1 January 2009 1,188,479 42,737 680,131 1,911,347 Total comprehensive income for the year Profit for the year - - 205,965 205,965 Other comprehensive income - 1,087 - 1,087

Total comprehensive income for the year - 1,087 205,965 207,052

Transactions with equity holders, recorded directly in equity Issue of shares (see Note 12) Under the rights issue 707,612 - - 707,612 Under the Dividend Reinvestment Scheme 46,361 - - 46,361 Under the Keppel Land Share Option Scheme 110 - - 110 To acquire remaining shares in Evergro Properties Limited 52,161 - - 52,161 Share issuance expenses (see Note 12) (7,181) - - (7,181) Cost of share-based payments - 1,941 - 1,941 Dividend paid (see Note 10) Cash - - (11,344) (11,344) Shares - - (46,361) (46,361) Deferred tax adjustment for equity component of convertible bond - 271 - 271

Total transactions with equity holders 799,063 2,212 (57,705) 743,570

Balance at 31 December 2009 1,987,542 46,036 828,391 2,861,969

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Statements of Changes in Equity 173 Consolidated Cash Flow Statement For the financial year ended 31 December 2010

2010 2009 $’000 $’000

Operating Activities: Operating profit 222,927 201,925 Adjustments for: Depreciation of fixed assets 9,007 9,454 Profit on sale of fixed assets and investment properties (5,996) (2,137) Write-back of provision for foreseeable losses on properties held for sale (3,872) (13,237) Allowance/(write-back of allowance) for doubtful debts 409 (58) Cost of share-based payments 3,099 1,941

Operating cash flows before changes in working capital 225,574 197,888 Working capital changes: Debtors (317,134) (84,612) Creditors 45,852 (3,053) Work-in-progress (141,915) (160,766) Consumable stocks 427 (72) Development expenditures (1,447,001) (355,565) Progress billings received/receivable 547,302 922,119

Cash flows from/(used in) operations (1,086,895) 515,939 Interest received 24,321 31,395 Interest paid (38,245) (41,217) Income taxes (paid)/refunded (57,114) 6,816

Net cash flows from/(used in) operating activities (1,157,933) 512,933

Investing Activities: Investment in associated companies (99,600) (331,731) Investment in investee companies (12,886) (5,236) Purchase of fixed assets (9,294) (7,984) Expenditure on investment properties (262,372) (71,516) Redemption of shares by an investee company - 596 Proceeds from disposal of interest in an associated company 839,840 - Dividends received from associated companies 204,795 60,321 Dividends received from investee companies 5,425 3,133 Proceeds from sale of fixed assets and investment properties 20,365 8,257

Net cash flows from/(used in) investing activities 686,273 (344,160)

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Keppel Land Limited 174 Report to Shareholders 2010 2010 2009 $’000 $’000

Financing Activities: Proceeds from issuance of shares, net of expenses in relation to Dividend Reinvestment Scheme and rights issue 3,400 700,541 Drawdown of loans 1,701,887 429,849 Repayment of loans (886,663) (812,052) Repayment of loans to related companies (2,524) (2,418) Repayment of loans by/(loans to) associated companies 488,796 (119,179) Dividends paid to shareholders (44,351) (11,344) Acquisition of non-controlling interests (114,378) (3,813) Advances from/(to) non-controlling shareholders of certain subsidiary companies 40,762 (28,709) Contribution from non-controlling shareholders 40,523 16,238 Dividends paid to non-controlling shareholders (42,042) (39,383)

Net cash flows from financing activities 1,185,410 129,730

Net increase in cash and cash equivalents 713,750 298,503 Cash and cash equivalents at beginning of year 892,711 626,361 Exchange adjustments (17,415) (32,153)

Cash and cash equivalents at end of year 1,589,046 892,711

The notes shown on pages 176 to 244 form an integral part of the financial statements.

Consolidated Cash Flow Statement 175 Notes to the Financial Statements For the financial year ended 31 December 2010

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

I. General Keppel Land Limited (“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 2010 were authorised for issue on 22 February 2011 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.

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

Adoption of Revised Standards In the current year, the Group adopted the following standards that are relevant and effective for financial years beginning on or after 1 January 2010:

FRS 103 Business Combinations (revised) FRS 27 Consolidated and Separate Financial Statements (revised) Improvements to FRSs issued in 2009

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

Keppel Land Limited 176 Report to Shareholders 2010 The principal effects of these changes are as follows:

FRS 103 Business Combinations (revised) The revised FRS 103 introduces a number of changes to the accounting for business combinations that will impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported results. Changes in significant accounting policies resulting from the adoption of the revised FRS 103 include:

- Transaction cost will no longer be capitalised as part of the cost of acquisition but will be expensed immediately; - Consideration contingent on future events are recognised at fair value on the acquisition date and any changes in the amount of the consideration to be paid will no longer be adjusted against goodwill but recognised in the profit and loss account; - The Group elects for each acquisition of a business, to measure non-controlling interest at fair value, or at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets, and this impacts the amount of goodwill recognised; and - When a business is acquired in stages, the previously held equity interests in the acquiree is remeasured to fair value at the acquisition date with any corresponding gain or loss recognised in the profit and loss account, and this impacts the amount of goodwill recognised.

According to its transitional provisions, the revised FRS 103 has been applied prospectively. Assets and liabilities that arose from business combinations whose acquisition dates are before 1 January 2010 are not adjusted.

FRS 27 Consolidated and Separate Financial Statements (revised) Changes in significant accounting policies resulting from the adoption of the revised FRS 27 include:

- A change in the ownership interest of a subsidiary company that does not result in a loss of control is accounted for as an equity transaction. Therefore, such a change will have no impact on goodwill, nor will it give rise to a gain or loss recognised in the profit and loss account; - Losses incurred by a subsidiary company are allocated to the non-controlling interest even if the losses exceed the non-controlling interest in the subsidiary company’s equity; and - When control over a subsidiary company is lost, any interest retained is measured at fair value with the corresponding gain or loss recognised in the profit and loss account.

According to its transitional provisions, the revised FRS 27 has been applied prospectively, and does not impact the Group’s consolidated financial statements in respect of transactions with non-controlling interests, attribution of losses to non-controlling interests and disposal of subsidiary companies before 1 January 2010. The changes will affect future transactions with non-controlling interests.

As a consequence of the revision of FRS 27, FRS 7 Statement of Cash Flows has been amended. Cash flows arising from changes in ownership interests in a subsidiary company that do not result in a loss of control are classified as cash flows from financing activities. The amendments to FRS 7 have been applied retrospectively and impact on the comparatives are shown in Note 34.

Improvements to FRSs issued in 2009 In 2009, the Accounting Standards Council issued an omnibus of amendments to FRS. There are separate transitional provisions for each amendment. The adoption of these improvements does not have any significant impact on the financial statements.

Notes to the Financial Statements 177 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(b) Basis of Consolidation

Business combinations from 1 January 2010 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 Company. Consistent accounting policies are applied to like transactions and events in similar circumstances.

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

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.

Business combinations are accounted for by applying the acquisition 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. Acquisition-related costs are recognised as expenses in the periods in which the costs are incurred and the services are received.

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.

Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognised in accordance with FRS 39 either in the profit and loss account or as change to other comprehensive income. If the contingent consideration is classified as equity, it is not remeasured until it is finally settled within equity.

In business combinations achieved in stages, previously held equity interests in the acquiree are remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised in the profit and loss account.

The Group elects for each individual business combination, whether non-controlling interest in the acquiree (if any) is recognised on the acquisition date at fair value, or at the non-controlling interest’s proportionate share of the acquiree identifiable net assets.

Any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of the Group’s previously held equity interest in the acquiree (if any), over the net fair value of the acquiree’s identifiable assets and liabilities is recorded as goodwill. The accounting policy for goodwill is set out in paragraph II(h). When the excess is negative, a gain on bargain purchase is recognised in the profit and loss account on the acquisition date.

Keppel Land Limited 178 Report to Shareholders 2010 Non-controlling 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 consolidated statement of comprehensive income, and within equity in the consolidated balance sheet, separately from the equity attributable to shareholders of the Company. Changes in the Company’s ownership interest in a subsidiary company that do not result in a loss of control are accounted for as equity transactions. In such circumstances, the carrying amounts of the controlling and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary company. Any difference between the amount by which the non-controlling interest is adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributable to shareholders of the Company.

Business combinations before 1 January 2010 In comparison to the above mentioned requirements, the following differences applied:

Business combinations were accounted for by applying the purchase method. Transaction costs directly attributable to the acquisition formed part of the acquisition costs. The non-controlling interest was measured at the proportionate share of the acquiree’s identifiable net assets.

Business combinations achieved in stages were accounted for as separate steps. Adjustments to those fair values relating to previously held interest were treated as a revaluation and recognised in equity.

Contingent consideration was recognised if, and only if, the Group had a present obligation, the economic outflow was more likely than not and a reliable estimate was determinable. Subsequent measurements to the contingent consideration affected goodwill.

(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 land and assets under construction, 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 and assets under construction.

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 (range from 20 to 50 years) 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 changes in estimates accounted for on a prospective basis.

Notes to the Financial Statements 179 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(d) Investment Properties Investment properties comprise completed properties and properties under construction or re-development held to earn rental and/or for capital appreciation. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are 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 gain or loss on the retirement or disposal of investment properties is 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 at the carrying values of the properties at the date of transfer.

(e) 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.

(f) 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. An associated company is equity accounted from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associated company.

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 and other comprehensive income of the associated companies are included in the Group’s profit and loss account and other comprehensive income respectively, and the Group’s share of net assets of the associated companies is included in the balance sheet. Unrealised gains and losses resulting from transactions between the Group and the associated company are eliminated to the extent of the interest in the associated company.

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.

Keppel Land Limited 180 Report to Shareholders 2010 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 behalf of the associated companies.

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 impairment losses. Upon loss of significant influence over the associated company, the Group measures any retained investment at its fair value. Any difference between the carrying amount of the associated company upon loss of significant influence and the fair value of the aggregate of the retained investment and proceeds from disposal is recognised in the profit and loss account.

(g) 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. Gains or losses arising from changes in fair value are recognised in other comprehensive income, except for impairment losses, foreign exchange gains and losses on monetary assets and interest calculated using the effective interest method which are recognised in profit and loss account. Where the investment is disposed of or determined to be impaired, the cumulative gains or losses previously recognised in other comprehensive income and accumulated in available-for- sale asset reserve are reclassified to 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.

Investments in equity instruments where fair value cannot be reliably determined are measured at cost less impairment losses.

(h) Goodwill Goodwill acquired in a business combination is initially measured at cost. Following initial recognition, goodwill is measured at cost less any accumulated impairment loss. 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.

(i) Derivative Financial Instruments Derivative financial instruments are initially recognised at fair value on the dates the derivative contracts are 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.

Notes to the Financial Statements 181 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(j) 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.

(k) 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.

(l) 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.

Keppel Land Limited 182 Report to Shareholders 2010 (m) Financial Assets Financial assets are recognised on the balance sheet when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. Financial assets include cash and cash equivalents, trade and other debtors, amounts owing by holding company and related parties, and investments. 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 at 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 had been previously recognised in other comprehensive income is recognised in the profit and loss account.

Non-derivative 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 method, less impairment losses. Gains and losses are recognised in profit and loss account when the loans and receivables are derecognised or impaired, and through the amortisation process.

(n) 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 reduce the carrying amount of the other assets of the CGU on a pro-rata basis.

An impairment loss recognised for goodwill is not reversed in a subsequent period. In respect of other non- financial assets, a previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the recoverable amount of the asset since the last impairment loss was recognised. The carrying amount of the asset is increased to its recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously. A reversal of impairment loss is recognised in the profit and loss account.

Notes to the Financial Statements 183 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(n) Impairment of Assets (continued)

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 years.

(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 profit and loss account, 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 recognised in 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.

Keppel Land Limited 184 Report to Shareholders 2010 (o) Financial Liabilities Financial liabilities within the scope of FRS 39 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, other than financial liabilities at fair value through profit or loss, 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 method.

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

(p) Convertible Bonds Convertible bonds are separated into the equity and liability components at the date of issue. The liability component is recognised initially at its fair value. Subsequent to initial recognition, it is carried at amortised cost using the effective interest method until the liability is extinguished on conversion or redemption of the bonds. The equity component is the residual amount of the convertible bond after deducting the fair value of the liability component. This is recognised and included in equity, net of deferred tax effect, and is not subsequently remeasured.

(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(j) 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 method).

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

Notes to the Financial Statements 185 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(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 method.

(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 year 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 and Share Plans The Group operates share-based compensation plans. The fair value of the employee services received in exchange for the grant of options, restricted shares and performance shares is recognised as an expense in the profit and loss account with a corresponding increase in the share option and share plan reserve over the vesting period. The total amount to be recognised over the vesting period is determined by reference to the fair values of the options, restricted shares and performance shares granted at the respective dates of grant.

At each balance sheet date, the Group revises its estimates of the number of options that are expected to become exercisable and share plan awards that are expected to vest on the vesting dates, and recognises the impact of the revision of the estimates in the profit and loss account, with a corresponding adjustment to the share option and share plan reserve over the remaining vesting period.

No expense is recognised for options or share plan awards that do not ultimately vest, except for options or share plan awards where vesting is conditional upon a market condition, which are treated as vested irrespective of whether or not the market condition is satisfied, provided that all other performance and/or service conditions are satisfied.

The proceeds received from the exercise of options are credited to share capital when the options are exercised. When the share plan awards are released, the share option and share plan reserve is transferred to share capital if new shares are issued.

(u) Taxation

Current Tax Current tax assets and liabilities for the current and prior years 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 to the extent that the tax relates to items recognised outside profit and loss account, either in other comprehensive income or directly in equity.

Keppel Land Limited 186 Report to Shareholders 2010 Deferred Tax Deferred tax is provided 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 is not recognised for the following temporary differences: the initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investment in subsidiary and associated companies to the extent that it is probable that they will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. 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 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 is recognised as an expense or income in the profit and loss account, except where it relates to items recognised in other comprehensive income or directly in equity, in which case the tax is also recognised in other comprehensive income or 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.

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.

Notes to the Financial Statements 187 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(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 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 settlement or translation of monetary items are taken to the profit and loss account, except for exchange differences arising on monetary items that form part of the Group’s net investment in foreign operations, which are recognised initially in other comprehensive income and accumulated under foreign currency translation account. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Exchange differences on non-monetary items such as available-for-sale financial assets 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 recognised in other comprehensive income and accumulated in the foreign currency translation account. On disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation shall be reclassified from equity to profit and loss account when the gain or loss on disposal is recognised.

In the case of a partial disposal without loss of control of a subsidiary company that includes a foreign operation, the proportionate share of the cumulative amount of the exchange differences are re-attributed to non-controlling interest and are not recognised in the profit and loss account. For partial disposal of associated companies that are foreign operations, the proportionate share of the accumulated exchange differences is reclassified to profit and loss account.

Goodwill and fair value adjustments arising on acquisition of a foreign entity on or after 1 January 2005 are treated as foreign currency assets and liabilities of the acquiree and recorded at the closing exchange rate.

Keppel Land Limited 188 Report to Shareholders 2010 (w) Segment Reporting For management purposes, the Group is organised into strategic business units based on their products, services and geography. The Group has four reportable operating segments, namely property trading, property investment, fund management, and also hotel and resorts, property services and others. Management monitors the results of each of these operating segments for the purpose of making decisions on resource allocation and performance assessment. Additional disclosures on these segments are shown in Note 28.

(x) Operating Leases Leases of assets in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases.

As Lessee Operating lease payments (net of any incentive received from lessor) are taken to the profit and loss account on a straight-line basis over the lease term. When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the year in which termination takes place.

As Lessor Assets leased out under operating leases are included in investment properties and are stated at fair values. Rental income (net of any incentive given to lessee) is recognised on a straight-line basis over the lease term.

(y) 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, except for contingent liabilities assumed in a business combination that are present obligations and for which the fair values can be reliably determined.

Notes to the Financial Statements 189 Notes to the Financial Statements

II. Significant Accounting Policies (continued)

(z) 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.

(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:

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(j). 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 year in which such determination is made. The carrying amount of taxation and deferred taxation is disclosed in the balance sheet.

Impairment of Non-Financial Assets The Group assesses at each balance sheet date whether there are any indicators of impairment for all non-financial assets.

Determining whether the carrying values of fixed assets, investments in subsidiary and associated companies are impaired requires an estimation of the value in use of the asset or the CGU. This requires the Group to estimate the future cashflows expected from the asset or 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 in subsidiary companies and investment in associated companies at the balance sheet date are disclosed in Notes 15, 18 and 19 respectively.

For properties held for sale, provision for foreseeable losses is made when the net realisable value has fallen below cost. The carrying amount of properties held for sale and the key assumptions used in estimating net realisable value and total construction costs are disclosed in Note 21.

Keppel Land Limited 190 Report to Shareholders 2010 Impairment of Available-for-Sale Financial Assets The Group follows the guidance of FRS 39 in determining when an available-for-sale financial asset is considered impaired. The Group evaluates, among other factors, the duration and extent to which the fair value of a financial asset is less than its cost, the financial health of and the near-term business outlook of the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow. The fair values of long-term investments are disclosed in Note 20.

Impairment of Loans and Receivables The Group assesses at each balance sheet date whether there is any objective evidence that a loan and receivable 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 loans and receivables at the balance sheet date are disclosed in Notes 17, 23, 24 and 25 to the financial statements.

Notes to the Financial Statements 191 Notes to the Financial Statements

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

2010 2009 Fair Value Fair Value Gain/(Loss)/ Gain/(Loss)/ Operations Impairment Total Operations Impairment Total $’000 $’000 $’000 $’000 $’000 $’000

Pre-tax profit 757,333 425,810 1,183,143 370,541 (11,977) 358,564 Taxation (99,724) (22,834) (122,558) (72,475) 13,241 (59,234) 657,609 402,976 1,060,585 298,066 1,264 299,330 Non-controlling interests (16,852) 2,098 (14,754) (36,751) 17,837 (18,914) Profit attributable to shareholders 640,757 405,074 1,045,831 261,315 19,101 280,416

2. Sales

Group 2010 2009 $’000 $’000

Trading of properties 579,583 720,774 Rental and related income 70,200 75,361 Fund management fees 68,723 42,749 Operations of hotels and resorts, property services, and others 73,767 84,985 792,273 923,869

Keppel Land Limited 192 Report to Shareholders 2010 3. Profit for the Year

Group 2010 2009 $’000 $’000

The following amounts have been charged/(credited) in arriving at the profit for the year: Depreciation of fixed assets (see Note 15): Freehold buildings 4 5 Leasehold properties 4,650 4,906 Machinery, equipment and vehicles 4,353 4,543 9,007 9,454

Profit on sale of fixed assets and investment properties (5,996) (2,137)

Auditors’ remuneration: Auditors of the Company 566 755 Other auditors 1,011 1,012

Fees to non-executive Directors of the Company 789 667

Key managers’ emoluments: Short-term benefits (including annual base salaries and annual performance incentives) 12,491 7,607 Employer’s contribution to defined contribution plans, including the Central Provident Fund 83 72 Cost of share-based payments 1,327 1,005 13,901 8,684 Staff costs: Short-term benefits (including annual base salaries and annual performance incentives) 93,078 81,355 Employer’s contribution to defined contribution plans, including the Central Provident Fund 5,773 4,193 Cost of share-based payments 1,772 936 100,623 86,484

Cost of properties held for sale recognised in cost of sales 402,037 525,363

Foreign exchange loss 2,895 8,305

Fair value gain on derivative financial instruments (4,701) -

Allowance/(write-back of allowance) for doubtful debts 409 (58)

Write-back of provision for foreseeable losses on properties held for sale (3,872) (13,237)

Direct expenses of investment properties that generate rental income 32,336 31,435

Staff costs capitalised during the year under properties held for sale amounted to $10,342,000 (2009: $7,608,000).

Notes to the Financial Statements 193 Notes to the Financial Statements

4. Interest and Investment Income

Group 2010 2009 $’000 $’000

Gross dividends from unquoted investments 5,425 3,133 Interest from instalment and deferred payment schemes 62 2,696 Interest from deposits and loans with: Banks 9,700 8,432 Associated companies 14,157 19,374 Related companies 272 777 Others 130 116 29,746 34,528

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:

2010 2009 Lowest Highest Lowest Highest % % % %

Singapore dollar 0.00 0.28 0.00 0.36 United States dollar 0.00 0.72 0.00 1.67 Australian dollar 3.20 4.65 - -

Information on interest rates for interest received from associated companies, related companies and banks is disclosed in Notes 17, 24 and 25.

5. Interest Expense

Group 2010 2009 $’000 $’000

Interest expense on: Convertible bonds Long-term portion (see Note 14) 1,135 13,846 Short-term portion (see Note 27) 14,111 - Other term loans and overdrafts from: Related companies 119 722 Banks 17,875 22,544 Loans from non-controlling shareholders of non-wholly owned subsidiary companies and others 3,195 2,626 Income support payables 1,810 1,479 38,245 41,217

Information on interest rates is disclosed in Notes 14, 24, 26 and 27.

Keppel Land Limited 194 Report to Shareholders 2010 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 2010 arose from the disposal of the Group’s interest in an associated company to K-REIT Asia as part of an asset swap arrangement between the Group and K-REIT Asia. Under the asset swap arrangement, the Group disposed of the associated company at a consideration of $1,399 million and at the same time, acquired Keppel Towers and GE Tower from K-REIT Asia at a consideration of $573 million.

8. Fair Value Gain/(Loss) on Investment Properties/Impairment

Group 2010 2009 $’000 $’000

(a) Fair value gain/(loss) on investment properties 442,650 (11,977) (b) Impairment of fixed assets (16,840) - 425,810 (11,977)

The fair value gain/(loss) on investment properties/impairment is analysed as follows:

2010 2009 non- Non- Deferred controlling Deferred controlling Gross Tax Interest net Gross Tax Interest Net $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Fair value gain/(loss): Subsidiary companies 22,746 (5,734) (4,188) 12,824 (86,462) 20,730 17,837 (47,895) Associated companies 419,904 (17,100) - 402,804 74,485 (7,489) - 66,996 442,650 (22,834) (4,188) 415,628 (11,977) 13,241 17,837 19,101

Impairment: Subsidiary companies (11,619) - 6,286 (5,333) - - - - Associated companies (5,221) - - (5,221) - - - - (16,840) - 6,286 (10,554) - - - -

Total 425,810 (22,834) 2,098 405,074 (11,977) 13,241 17,837 19,101

During the year, the Group made impairment (net of non-controlling interests) of $10,554,000 for two hotels in Indonesia. The carrying values of these two hotels were written down to their recoverable amounts based on valuations by independent firms of professional valuers as at 31 December 2010.

Notes to the Financial Statements 195 Notes to the Financial Statements

9. Taxation

Group 2010 2009 $’000 $’000

Current tax: Current income tax 61,071 52,038 Under/(over) provision in respect of previous years 6,276 (2,197) 67,347 49,841 Deferred tax: Origination and reversal of temporary differences 6,735 (12,306) Overprovision in respect of previous years (444) (6,328) Reduction in tax rate - (8,607) 6,291 (27,241)

73,638 22,600 Associated companies (see Note 19) 48,920 36,634 122,558 59,234

The reconciliation between the tax expense reported and the product of accounting profit multiplied by the applicable tax rate is as follows:

Group 2010 2009 $’000 $’000

Pre-tax profit 1,183,143 358,564

Tax calculated at tax rate of 17% (2009: 17%) 201,134 60,956 Adjustments: Non-deductible expenses 21,640 12,051 Income not subject to tax (62,208) (3,263) Share of results of associated companies (100,481) (40,577) Under/(over) provision in respect of previous years 5,832 (8,525) Different tax rates in other jurisdictions 14,536 12,380 Utilisation of previously unrecognised tax benefits (6,815) (1,815) Effect of reduction in tax rate - (8,607) 73,638 22,600

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 the 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 financial statements of the transferor company.

Keppel Land Limited 196 Report to Shareholders 2010 Tax Provision

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Provision for taxation 166,818 155,289 9,976 6,930 Income tax refund receivable (315) (90) - - 166,503 155,199 9,976 6,930

Subject to Sections 23 and 37 of the Income Tax Act, Cap 134, the Group has certain unutilised tax losses of $218,935,000 (2009: $242,370,000) and capital allowances of $7,000 (2009: $57,000) at 31 December 2010 for which related tax benefits totaling $37,220,000 (2009: $41,213,000) have not been included in the financial statements. 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 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Tax liabilities arising from: Fair value gain on investment properties 81,207 75,717 - - Differences in depreciation 8,160 7,021 - - Differences in fair values and book values of assets of subsidiary companies acquired 8,062 12,172 - - Issuance of convertible bonds 5,052 3,615 5,052 3,615 Others 340 (2) 5 5 102,821 98,523 5,057 3,620

As at 31 December 2010, deferred tax liabilities amounting to $15,559,000 (2009: $10,126,000) 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.

Notes to the Financial Statements 197 Notes to the Financial Statements

9. Taxation (continued)

Movements in the deferred tax liabilities and assets are as follows:

Fair Value Adjustments on Fair Value Gain Acquisition of Issuance of on Investment Differences in Subsidiary Convertible Properties Depreciation Companies Bonds Others Total $’000 $’000 $’000 $’000 $’000 $’000

GROUP At 1 January 2010 75,717 7,021 12,172 3,615 (2) 98,523 Charged/(credited) to profit and loss account 5,734 1,546 (285) (1,031) 327 6,291 Charged to equity - - - 2,468 - 2,468 Reclassification/adjustment 382 (382) (3,825) - - (3,825) Exchange differences on consolidation (626) (25) - - 15 (636) At 31 December 2010 81,207 8,160 8,062 5,052 340 102,821

At 1 January 2009 97,168 4,787 13,052 4,827 6,625 126,459 Charged/(credited) to profit and loss account (20,730) 1,941 (880) (941) (6,631) (27,241) Credited to equity - - - (271) - (271) Exchange differences on consolidation (721) 293 - - 4 (424) At 31 December 2009 75,717 7,021 12,172 3,615 (2) 98,523

Issuance of Convertible Bonds Others Total $’000 $’000 $’000

COMPANY At 1 January 2010 3,615 5 3,620 Credited to profit and loss account (1,031) - (1,031) Charged to equity 2,468 - 2,468 At 31 December 2010 5,052 5 5,057

At 1 January 2009 4,827 4,993 9,820 Credited to profit and loss account (941) (4,988) (5,929) Credited to equity (271) - (271) At 31 December 2009 3,615 5 3,620

There is no deferred tax recognised in other comprehensive income.

Keppel Land Limited 198 Report to Shareholders 2010 10. Dividends

(a) Final Dividend Paid Group and Company 2010 2009 $’000 $’000

Dividends on ordinary shares: Final one-tier dividend of 8 cents per share under the Dividend Reinvestment Scheme (2009: Final one-tier dividend of 8 cents per share under the Dividend Reinvestment Scheme): Cash 44,351 11,344 Shares 70,078 46,361 114,429 57,705

(b) The Directors have proposed that a final one-tier dividend of 18 cents per share, comprising an ordinary dividend of 9 cents per share and a special dividend of 9 cents per share (2009: ordinary dividend of 8 cents per share) amounting to $261,044,000 (2009: $114,429,000), subject to the shareholders’ approval at the forthcoming Annual General Meeting of the Company, be paid for the year ended 31 December 2010. The Dividend Reinvestment Scheme will be applicable to this final dividend.

Notes to the Financial Statements 199 Notes to the Financial Statements

11. Earnings per Share

Group 2010 2009 $’000 $’000 Basic Diluted Basic Diluted

Profit attributable to shareholders (see Note 1) 640,757 640,757 261,315 261,315 Fair value gain on investment properties/impairment, net of deferred tax and non-controlling interests (see Notes 1 and 8) 405,074 405,074 19,101 19,101 Profit after fair value gain on investment properties/impairment 1,045,831 1,045,831 280,416 280,416

2010 2009 Number of Shares Number of Shares ’000 ’000 Basic Diluted Basic Diluted

Weighted average number of shares 1,437,145 1,437,145 1,157,694 1,157,694

Adjustment for potential dilutive shares under: Employee share option scheme - 109 - 48 Restricted share plan - 886 - - Performance share plan - 963 - - Weighted average number of shares used to compute earnings per share 1,437,145 1,439,103 1,157,694 1,157,742

Earnings per share (cents) based on: Profit before fair value gain/(loss) on investment properties/impairment 44.6 44.5 22.6 22.6 Profit after fair value gain/(loss) on investment properties/impairment 72.8 72.7 24.2 24.2

The earnings per share with the inclusion of profit after fair value gain/(loss) on investment properties/impairment have taken into account deferred tax and non-controlling interests as shown in Note 8.

Keppel Land Limited 200 Report to Shareholders 2010 12. Share Capital

Group and Company 2010 2009 2010 2009 Number of Number of $’000 $’000 Shares Shares ’000 ’000

Issued and fully paid: 1,450,245,722 (2009: 1,429,742,919) ordinary shares 1,450,246 1,429,743 2,061,020 1,987,542

Issued and fully paid: At 1 January 1,429,743 721,317 1,987,542 1,188,479 Issue of shares: Under the rights issue - 649,185 - 707,612 Under the Dividend Reinvestment Scheme 19,305 34,342 70,078 46,361 Under the Keppel Land Share Option Scheme 1,198 61 3,550 110 To acquire remaining shares in Evergro Properties Limited - 24,838 - 52,161 Share issuance expenses - - (150) (7,181) At 31 December 1,450,246 1,429,743 2,061,020 1,987,542

On 14 June 2010, the Company allotted and issued 19,304,976 ordinary shares at an issue price of $3.63 per share to eligible shareholders who have validly elected to participate in the Dividend Reinvestment Scheme in respect of the final dividend of 8 cents per share for the financial year ended 31 December 2009.

During the year, the Company issued for cash 1,197,827 shares comprising 34,022 shares at $1.60 per share, 28,157 shares at $2.11 per share, 9,385 shares at $1.16 per share, 152,514 shares at $2.03 per share, 319,694 shares at $2.62 per share, 284,499 shares at $3.33 per share, 208,242 shares at $3.47 per share and 161,314 shares at $3.76 per share to certain full-time employees on the exercise of their 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. The ordinary shares have no par value.

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

At the Extraordinary General Meeting of the Company held on 23 April 2010, the Company’s shareholders approved the adoption of two new share plans, with effect from the date of termination of the Scheme. The Scheme was terminated on 30 June 2010. Options granted and outstanding prior to the termination will continue to be valid and subject to the terms and conditions of the Scheme.

Notes to the Financial Statements 201 Notes to the Financial Statements

12. Share Capital (continued)

Keppel Land Share Option Scheme (continued) (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.

Movements in the number of share options and their weighted average exercise prices are as follows:

2010 2009 Weighted Weighted Average Average N number of Exercise Number of Exercise Options Price Options Price

At 1 January 5,965,848 $3.69 3,867,500 $5.26 Granted 960,750 $3.37 1,833,000 $1.94 Exercised (1,197,827) $2.96 (60,446) $1.81 Forfeited (172,207) $2.59 (381,119) $4.43 Expired (4,693) $2.11 (71,966) $2.02 Adjustment due to rights issue - $ - 778,879 $3.84 At 31 December 5,551,871 $3.82 5,965,848 $3.69

Exercisable at 31 December 2,863,757 $5.17 2,572,777 $4.63

The weighted average share price at the date of exercise for options exercised during the financial year was $4.05 (2009: $2.74). The options outstanding at the end of the financial year had a weighted average exercise price of $3.82 (2009: $3.69) and a weighted average remaining contractual life of 7.7 years (2009: 8 years).

Keppel Land Limited 202 Report to Shareholders 2010 (d) On 8 February 2010, the Company granted 960,750 options under the Scheme. The estimated fair value of the options granted is $1.184. This fair value is determined using the Black-Scholes pricing model. The main inputs into the model are as follows:

2010 2009 Date of Grant 08.02.10 04.02.09 05.08.09

Share price $3.37 $1.39 $2.67 Exercise price, adjusted for rights issue $3.37 $1.19 $2.67 Expected volatility 48.53% 44.76% 48.59% Expected life 5 years 5 years 5 years Risk free rate 1.22% 1.37% 1.35% Expected dividend yield 2.37% 5.76% 3.00%

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.

(e) As at 31 December 2010, there were options granted to certain employees to take up 5,551,871 unissued shares in the Company as follows:

Exercise Price (Adjusted for number of Share Rights Issue) Options (Adjusted for ($) Rights Issue)

1.16 14,078 1.23 17,598 3.33 117,319 3.47 269,833 6.81 554,333 6.86 554,332 5.03 653,467 3.76 682,797 1.19 927,114 2.67 865,250 3.37 895,750 5,551,871

Notes to the Financial Statements 203 Notes to the Financial Statements

12. Share Capital (continued)

Keppel Land Share Plans (a) The Keppel Land Restricted Share Plan (“KLL RSP”) and Keppel Land Performance Share Plan (“KLL PSP”) are share-based incentive plans for the key senior management and employees of the Company. They were approved by the Company’s shareholders at the Extraordinary General Meeting of the Company on 23 April 2010 and are administered by the Remuneration Committee.

(b) Details of the KLL RSP and KLL PSP are as follows:

KLL RSP KLL PSP

Plan Description Award of fully-paid ordinary shares of the Award of fully-paid ordinary shares of the Company, conditional on achievement of Company, conditional on achievement of pre-determined targets at the end of a pre-determined targets over a one-year performance period three-year performance period

Performance Conditions Return on equity (a) Economic value added (b) Absolute total shareholder’s return (c) Relative total shareholder’s return to FTSE ST Real Estate Holding & Development (“FSTREH”) Index

Final Award 0% or 100% of the contingent award 0% to 150% of the contingent award granted, depending on achievement of granted, depending on achievement of pre-determined targets pre-determined targets

Vesting Condition If pre-determined targets are achieved, If pre-determined targets are achieved, and Schedule awards will vest equally over three years awards will vest at the end of the subject to fulfillment of service three-year performance period subject requirements to fulfillment of service requirements

2010 RSP PSP

At 1 January - - Granted 886,000 656,000 Cancelled (12,000) - At 31 December 874,000 656,000

As at 31 December 2010, the number of contingent shares granted but not released were 874,000 under KLL RSP and 656,000 under KLL PSP. Depending on the achievement of pre-determined performance targets, the actual number of shares to be released can be zero or 874,000 shares under KLL RSP and range from zero to a maximum of 984,000 shares under KLL PSP.

Keppel Land Limited 204 Report to Shareholders 2010 (d) On 30 June 2010, the Company granted contingent awards of 886,000 shares under KLL RSP and 656,000 shares under KLL PSP. The estimated fair values of the shares granted under KLL RSP range from $3.67 to $3.86. The estimated fair value of the shares granted under KLL PSP is $2.35. The fair values of the contingent awards are determined at the grant date using Monte Carlo simulation method which involves projection of future outcomes using statistical distributions of key random variables including share price and volatility. The significant inputs into the model are as follows:

2010 RSP PSP

Date of grant 30.06.10 30.06.10 Prevailing share price at date of grant $3.90 $3.90 Expected volatility Company 65.94% 65.94% FSTREH Index - 38.22% Correlation with FSTREH Index - 92.80% Expected term 0.5 - 2.5 years 2.5 years Risk free rate 0.42% - 0.53% 0.53% Expected dividend yield * *

* The expected dividend yield is based on management’s forecast.

The expected volatilities are based on the historical volatilities of the Company’s share price and the FSTREH Index price over the previous 36 months immediately preceding the grant date. The expected term used in the model is based on the grant date and the end of the performance period.

(e) Senior managers are required to hold a portion of the shares released to them under a share ownership guideline which requires them to maintain a beneficial ownership stake in the Company, so as to align their interests with the shareholders.

Notes to the Financial Statements 205 Notes to the Financial Statements

12. Share Capital (continued)

Share Plans of a Subsidiary Company (a) K-REIT Asia Management Limited (“KRAM”), a wholly-owned subsidiary company of the Group, implemented a Restricted Unit Plan (“KRAM RUP”) and a Performance Unit Plan (“KRAM PUP”) (collectively the “unit plans”) for its key senior management and employees. The KRAM RUP and KRAM PUP were approved and administered by the Nominating and Remuneration Committee of KRAM.

(b) KRAM is the manager of K-REIT Asia. The awards granted by KRAM will be settled in K-REIT Asia units. Details of the KRAM RUP and KRAM PUP are as follows:

KRAM RUP KRAM PUP

Plan Description Award of fully-paid units of K-REIT Asia Award of fully-paid units of K-REIT Asia (“units”), conditional on achievement of (“units”), conditional on achievement of pre-determined targets at the end of a pre-determined targets over a one-year performance period three-year performance period

Performance Conditions Distributable income (a) Growth in assets under management (b) Absolute total shareholder’s return (c) Relative total shareholder’s return to FTSE ST REIT (“FSTREI”) Index

Vesting Condition If pre-determined targets are achieved, If pre-determined targets are achieved, and Schedule awards will vest equally over three years awards will vest at the end of the subject to fulfillment of service three-year performance period requirements subject to fulfillment of service requirements

2010 RUP PUP

At 1 January - - Granted 70,500 108,000 Cancelled - - At 31 December 70,500 108,000

As at 31 December 2010, the number of contingent units granted but not released were 70,500 under KRAM RUP and 108,000 under KRAM PUP. Depending on the achievement of pre-determined performance targets, the actual number of units to be released can be zero or 70,500 units under KRAM RUP and range from zero to a maximum of 162,000 units under KRAM PUP.

Keppel Land Limited 206 Report to Shareholders 2010 (d) On 30 December 2010, KRAM granted contingent awards of 70,500 units under KRAM RUP and 108,000 units under KRAM PUP. The estimated fair values of the units granted under KRAM RUP range from $1.31 to $1.41. The estimated fair value of the units granted under KRAM PUP is $1.19. The fair values of the contingent awards are determined at the grant date using Monte Carlo simulation method which involves projection of future outcomes using statistical distributions of key random variables including share price and volatility. The significant inputs into the model are as follows:

2010 RUP PUP

Date of grant 30.12.10 30.12.10 Prevailing unit price at date of grant $1.41 $1.41 Expected volatility K-REIT Asia 45.61% 45.61% FSTREI Index - 34.42% Correlation with FSTREI Index - 83.30% Expected term 0 - 2 years 2 years Risk free rate 0.38% - 0.72% 0.72% Expected dividend yield * *

* The expected dividend yield is based on management’s forecast.

The expected volatilities are based on the historical volatilities of K-REIT Asia’s unit price and the FSTREI Index price over the previous 36 months immediately preceding the grant date. The expected term used in the model is based on the grant date and the end of the performance period.

(e) Senior managers of KRAM are required to hold a portion of the units released to them under a share ownership guideline which requires them to maintain a beneficial ownership stake in K-REIT Asia, so as to align their interests with the unitholders.

Notes to the Financial Statements 207 Notes to the Financial Statements

13. Reserves

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Capital reserves: Equity component of convertible bonds 44,984 32,934 44,984 32,934 Share option and share plan reserves 13,521 10,422 13,521 10,422 Available-for-sale asset reserves 20,368 18,128 3,713 2,680 Net premium paid on acquisition of non-controlling interests (61,395) (21,364) - - Others 5,863 10,100 - - 23,341 50,220 62,218 46,036

Foreign currency translation account (67,531) (12,718) - - Revenue reserves 2,284,441 1,350,745 897,939 828,391 2,240,251 1,388,247 960,157 874,427

The equity component of convertible bond represents the residual amount of the convertible bond after deducting the fair value of the liability component. This amount is presented net of deferred tax liability.

The share option and share plan reserves represent the cumulative value of employee services received for the issue of share options and shares under the share plans.

The available-for-sale asset reserves represent the cumulative net change in fair value of available-for-sale financial assets until they are derecognised.

The net premium paid on acquisition of non-controlling interests represents the difference between the consideration and the book value of the share of net assets acquired from the non-controlling interests.

Others comprise mainly statutory reserve and capital redemption reserve.

The foreign currency translation account represents the exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from that of the Group’s presentation currency, as well as the translation of monetary items that forms part of the Group’s net investment in foreign operations.

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

Keppel Land Limited 208 Report to Shareholders 2010 14. Long-term Borrowings

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Borrowings under MTN Programme 380,000 70,000 380,000 70,000

Liability component of convertible bonds 478,436 275,925 478,436 275,925

Bank borrowings: Secured 748,230 166,637 - - Unsecured 490,743 - 440,000 - 1,238,973 166,637 440,000 -

Unsecured loans from related companies 102,260 391,008 - - 2,199,669 903,570 1,298,436 345,925

The Company has a US$800 million Multicurrency Medium Term Note (“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 fixed rate notes of $50,000,000, $75,000,000, $155,000,000 and $100,000,000 due in 2012, 2013, 2015 and 2017 respectively with interest rates ranging from 2.67% to 4.25% (2009: 3.76% to 4.25%) per annum.

The Group’s secured bank borrowings are repriced within 1 to 12 months (2009: 1 to 12 months). They are repayable between 2 to 4 years (2009: 2 to 3 years) and generally secured by: (a) mortgages on the borrowing subsidiary companies’ investment properties (see Note 16) and properties held for sale (see Note 21); and (b) assignment of all rights, titles and benefits with respect to some of the properties mortgaged.

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 12 months (2009: daily, or within 12 months).

Convertible Bonds The Company has the following convertible bonds which remained outstanding as at 31 December 2010:

(a) On 23 June 2006, the Company issued a $300,000,000 2.50%, 7-year convertible bond (“2006 Bond”). Interest is payable semi-annually. The 2006 Bond maturing on 23 June 2013 was initially convertible at the option of bondholders to ordinary shares of the Company at the conversion price of $6.55 per share. As a result of the Company’s rights issue in 2009, an adjustment was made to the conversion price based on the formulae provided in the Offering Circular dated 19 June 2006. The adjusted conversion price with effect from 12 June 2009 is $5.58 per share. The adjustment to the conversion price also resulted in an adjustment to the number of ordinary shares that may be issued pursuant to the conversion of the bond from 45,801,526 new shares to 53,763,440 new shares.

Any bondholder may request that the Company redeems all or some of the 2006 Bond on 23 June 2011 or in the event that the Company’s shares cease to be listed or admitted to trading on the Singapore Exchange Securities Trading Limited. As the 2006 Bond may be redeemed at the option of the bondholders on 23 June 2011, it has been reclassified to short-term borrowings (see Note 27).

Notes to the Financial Statements 209 Notes to the Financial Statements

14. Long-term Borrowings (continued)

Convertible Bonds (continued) (b) On 29 November 2010, the Company issued a $500,000,000 1.875%, 5-year convertible bond (“2010 Bond”). Interest is payable semi-annually. The 2010 Bond maturing on 29 November 2015 is convertible at the option of bondholders to ordinary shares of the Company at the conversion price of $6.72 per share. The 2010 Bond may be redeemed, in whole or in part, at the option of the Company at any time on or after 29 November 2013 subject to the satisfaction of certain conditions. Any bondholder may request that the Company redeems all of the 2010 Bond in the event that the Company’s shares cease to be listed or admitted to trading on the Singapore Exchange Securities Trading Limited.

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

Group and Company 2010 2009 $’000 $’000

At 1 January 275,925 269,579 Reclassification to short-term borrowings (see Note 27) (275,925) - - 269,579

Face value of 2010 Bond 500,000 - Equity component, net of deferred tax liability (12,050) - Deferred tax liability (2,468) - Bond issue expenses (7,400) - Liability component on initial recognition of 2010 Bond 478,082 - Interest expense (see Note 5) 1,135 13,846 Interest paid/accrued (781) (7,500) At 31 December 478,436 275,925

Interest expense on the 2010 Bond is calculated based on the effective interest method by applying the interest rates of 2.5% (2009: Nil) per annum for an equivalent non-convertible bond to the liability component of the convertible bond.

Keppel Land Limited 210 Report to Shareholders 2010 Interest rates (per annum) on the Group’s borrowings, except for borrowings under the MTN Programme and convertible bonds, are as follows: 2010 2009 Lowest Highest Lowest Highest % % % %

Secured bank borrowings denominated in: Singapore dollar 0.62 2.34 0.85 2.48 Indonesian rupiah 9.75 11.75 11.75 14.50 Thai baht 6.25 6.38 - -

Unsecured bank borrowings denominated in: Singapore dollar 0.85 2.54 - - United States dollar 3.50 4.30 - - Vietnamese dong 13.00 15.50 - - Indonesian rupiah 9.18 9.18 - -

Unsecured loans from related companies denominated in: Singapore dollar 0.96 1.42 0.88 2.31 United States dollar 0.85 4.20 0.84 4.85 Hong Kong dollar 0.48 1.00 0.50 3.00

Long-term borrowings are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 2,020,551 763,164 1,298,436 345,925 United States dollar 87,628 96,452 - - Vietnamese dong 27,052 - - - Indonesian rupiah 37,031 24,725 - - Thai baht 8,975 - - - Hong Kong dollar 18,432 19,229 - - 2,199,669 903,570 1,298,436 345,925

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

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

After 1 but within 2 years 597,739 411,008 150,000 20,000 After 2 but within 5 years 1,501,930 492,562 1,048,436 325,925 After 5 years 100,000 - 100,000 - 2,199,669 903,570 1,298,436 345,925

Included in loans payable after 1 year but within 2 years are unsecured loans of $102,260,000 (2009: $391,008,000) due to related companies by the Group.

Notes to the Financial Statements 211 Notes to the Financial Statements

15. Fixed Assets

Long Freehold Leasehold machinery, Assets Land and Land and Equipment under Building Buildings and Vehicles Construction Total $’000 $’000 $’000 $’000 $’000

GROUP Cost At 1 January 2010 156 292,549 125,370 54,404 472,479 Additions - 2,209 5,012 2,073 9,294 Disposals - - (721) - (721) Cost adjustment - - 54 - 54 Reclassification - (1,164) 1,164 - - Exchange differences on consolidation - (13,528) (4,842) (2,631) (21,001) At 31 December 2010 156 280,066 126,037 53,846 460,105

Accumulated Depreciation and Impairment At 1 January 2010 109 131,332 113,200 - 244,641 Depreciation charge 4 4,650 4,353 - 9,007 Impairment - 11,619 - - 11,619 Disposals - - (663) - (663) Cost adjustment - - 232 - 232 Reclassification - (202) 202 - - Exchange differences on consolidation - (6,700) (4,626) - (11,326) At 31 December 2010 113 140,699 112,698 - 253,510

Net Carrying Amount 43 139,367 13,339 53,846 206,595

Cost At 1 January 2009 156 307,023 138,190 54,992 500,361 Additions - 2,080 2,488 3,416 7,984 Disposals - - (1,188) - (1,188) Cost adjustment - (890) 194 - (696) Reclassification - 5,827 (5,810) (17) - Exchange differences on consolidation - (21,491) (8,504) (3,987) (33,982) At 31 December 2009 156 292,549 125,370 54,404 472,479

Accumulated Depreciation and Impairment At 1 January 2009 104 136,544 116,470 - 253,118 Depreciation charge 5 4,906 4,543 - 9,454 Disposals - - (839) - (839) Cost adjustment - - 403 - 403 Exchange differences on consolidation - (10,118) (7,377) - (17,495) At 31 December 2009 109 131,332 113,200 - 244,641

Net Carrying Amount 47 161,217 12,170 54,404 227,838

Keppel Land Limited 212 Report to Shareholders 2010 Freehold Land and Building $’000

COMPANY Cost At 1 January 2010 and 31 December 2010 156

Accumulated Depreciation At 1 January 2010 109 Depreciation charge 5 At 31 December 2010 114

Net Carrying Amount 42

Cost At 1 January 2009 and 31 December 2009 156

Accumulated Depreciation At 1 January 2009 104 Depreciation charge 5 At 31 December 2009 109

Net Carrying Amount 47

Notes to the Financial Statements 213 Notes to the Financial Statements

16. Investment Properties

Investment Properties Completed under Investment Construction/ Properties Redevelopment Total $’000 $’000 $’000

GROUP Valuation At 1 January 2010 618,092 786,900 1,404,992 Development expenditure 31,995 230,377 262,372 Fair value gain/(loss) (5,977) 28,723 22,746 Disposals (14,311) - (14,311) Transfer from properties held for sale 31,633 - 31,633 Reclassification (13,171) 13,171 - Exchange differences on consolidation (7,592) - (7,592) At 31 December 2010 640,669 1,059,171 1,699,840

At 1 January 2009 637,526 795,426 1,432,952 Development expenditure 5,575 65,941 71,516 Fair value loss (11,995) (74,467) (86,462) Disposals (5,771) - (5,771) Write-off to profit and loss account (255) - (255) Transfer to properties held for sale (21) - (21) Exchange differences on consolidation (6,967) - (6,967) At 31 December 2009 618,092 786,900 1,404,992

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 2010:

(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 fair values, the valuers have used valuation techniques which involve certain estimates. The key assumptions to determine the fair value of investment properties include market-corroborated capitalisation yield, terminal yield and discount rate. 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.

Keppel Land Limited 214 Report to Shareholders 2010 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 of the completed investment properties 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.

In determining the fair values for investment properties under construction/redevelopment, the valuers have considered the direct comparison method and/or residual value method to determine the fair value of the land, as well as the fair value of the work completed as at the balance sheet date.

Based on these valuations, the Group’s share of fair value gain (after adjusting for deferred tax and non-controlling interests) amounted to $12,824,000 (2009: fair value loss of $47,895,000) and was taken to profit and loss account in accordance with FRS 40.

The valuations of completed investment properties are generally sensitive to changes in yield and rental rates. The valuations of investment properties under construction/redevelopment are generally sensitive to changes in construction costs and interest rates.

Properties amounting to $1,361,900,000 (2009: $1,087,300,000) in value and included in the above balances were mortgaged to banks as securities for borrowings referred to in Note 14.

Interest capitalised during the year was $1,968,000 (2009: $1,992,000).

Notes to the Financial Statements 215 Notes to the Financial Statements

17. Amounts owing by Associated Companies

Group 2010 2009 $’000 $’000

Amounts owing by associated companies 446,161 940,708

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 bear interest at rates ranging from 1.18% to 1.50% (2009: 1.47% to 2.67%) per annum and are denominated in Singapore dollars.

18. Subsidiary Companies

cOMPANY 2010 2009 $’000 $’000

Quoted shares, at cost (Market value: $15,973,000; 2009: $12,345,000) 49,862 54,350 Unquoted shares, at cost 1,557,662 1,505,657 1,607,524 1,560,007 Impairment (334,529) (271,326) 1,272,995 1,288,681

During the year, allowance for impairment loss amounting to $63,205,000 (2009: Nil) was made in respect of the Company’s investments in certain subsidiary companies to reduce the carrying value of investments to the recoverable amounts, taking into account the financial conditions of the subsidiary companies. In addition, there was reversal of impairment of $2,000 (2009: $5,000) in relation to subsidiary companies which were transferred to another subsidiary company.

The details of the significant subsidiary companies are disclosed in Note 37.

Acquisition of Non-controlling Interests On 8 November 2010, the Group acquired an additional 11.85% equity interest in Ocean Properties Pte. Limited (“OPPL”) for a cash consideration of $107,106,000. Following the acquisition, the Group’s effective interest in OPPL increased to 87.51%. On the date of acquisition, the book value of the interest acquired was $65,476,000. The difference between the consideration and the book value of the interest acquired of $41,630,000 is reflected in equity as premium paid on acquisition of non-controlling interests.

On 14 December 2010, the Group acquired an additional 16.55% equity interest in Jiangyin Evergro Properties Co. Ltd (“JEP”) for a cash consideration of $7,272,000. Following the acquisition, the Group’s effective interest in JEP increased to 99.44%. On the date of acquisition, the book value of the interest acquired was $8,871,000. The difference between the consideration and the book value of the interest acquired of $1,599,000 is reflected in equity as discount paid on acquisition of non-controlling interests.

Keppel Land Limited 216 Report to Shareholders 2010 19. Associated Companies

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Investment, at cost 1,148,128 1,086,048 120,201 166,177 Share of post-acquisition reserves 271,714 346,401 - - Investment in associated companies 1,419,842 1,432,449 120,201 166,177 Impairment - - (18,340) (18,340) 1,419,842 1,432,449 101,861 147,837

Investment in associated companies is represented by: Quoted shares (Market value: $882,858,000; 2009: $666,886,000) 768,163 742,227 - - Unquoted shares 651,679 690,222 120,201 166,177 1,419,842 1,432,449 120,201 166,177

The details of the significant associated companies are disclosed in Note 37.

The Group’s share of net profit of associated companies is as follows:

2010 2009 $’000 $’000

Share of pre-tax profit before fair value gains on investment properties/impairment 176,379 164,203 Share of fair value gains on investment properties/impairment 414,683 74,485 Share of pre-tax profit 591,062 238,688 Share of taxation (see Note 9) (48,920) (36,634) Share of net profit 542,142 202,054

The summarised financial information of the associated companies on a 100% basis is as follows:

2010 2009 $’000 $’000

Total assets 8,931,795 10,356,350 Total liabilities (5,050,058) (6,118,975) Revenue for the year 1,736,921 1,633,032 Profit for the year 1,167,671 388,928

Notes to the Financial Statements 217 Notes to the Financial Statements

20. Long-term Investments

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Quoted shares in corporations 68 72 - - Unquoted shares in corporations 7,283 6,250 7,254 6,221 Private property fund 103,987 61,562 - - 111,338 67,884 7,254 6,221

21. Properties Held for Sale

Group 2010 2009 $’000 $’000

(a) Properties under development: Land cost 1,873,964 844,412 Development cost incurred to-date 806,252 735,072 Related overhead expenditure 234,116 207,425 Development profit 233,063 256,550 Progress billings received and receivable (1,003,603) (977,287) Provision for foreseeable losses (30,541) (36,559) 2,113,251 1,029,613

Analysis of provision for foreseeable losses: At 1 January (36,559) (64,079) Transfer to completed properties held for sale - 12,539 Provisions written back 2,600 5,028 Provisions utilised 3,418 9,953 At 31 December (30,541) (36,559)

(b) Completed properties held for sale 18,517 134,023 Provision for foreseeable losses (6,406) (11,642) 12,111 122,381

Analysis of provision for foreseeable losses: At 1 January (11,642) (8,108) Transfer from properties under development - (12,539) Provisions written back 1,272 8,209 Provisions utilised 3,960 786 Exchange differences on consolidation 4 10 At 31 December (6,406) (11,642)

2,125,362 1,151,994

Interest capitalised during the year was $16,368,000 (2009: $17,319,000) at rates ranging from 1.00% to 2.50% (2009: 0.91% to 4.14%) per annum for Singapore properties and 2.88% to 15.50% (2009: 3.10% to 21.00%) per annum for overseas properties.

Keppel Land Limited 218 Report to Shareholders 2010 The provision for foreseeable losses is estimated taking into account estimated selling prices and estimated total construction costs. The estimated selling prices are based on recent selling prices for the development project or comparable projects and the prevailing market conditions. The estimated total construction costs include contracted amounts plus estimated costs to be incurred based on historical trends. The provision is progressively reversed based on the percentage of completion method for those residential units sold above their carrying amounts.

Properties amounting to $444,705,000 (2009: $101,879,000) in value and included in the above balances were mortgaged to banks as securities for borrowings as referred to in Notes 14 and 27.

22. Stocks

Group 2010 2009 $’000 $’000

Spare parts and consumable stores 3,265 3,692

23. Debtors

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

(a) Trade debtors: 89,737 131,322 - - Allowance for doubtful debts (832) (837) - - 88,905 130,485 - -

(b) Other debtors: Deposits paid 4,490 3,230 - - Land tender deposits 140,021 - - - Advance land payments 241,796 20,664 - - Interest receivable 10,707 13,977 - - Advances to corporations in which the Group has equity interests 250 251 - - Advances to non-controlling shareholders of subsidiary companies 44,759 9,496 - - Advance to joint venture partner - 48,300 - - Derivative financial instruments 4,701 - - - Other debtors 25,536 25,872 - - Other recoverable amounts 31,552 45,895 177 3 503,812 167,685 177 3 Allowance for doubtful debts (23,899) (23,660) - - 479,913 144,025 177 3

586,753 295,208 4,828 3,896

Notes to the Financial Statements 219 Notes to the Financial Statements

23. Debtors (continued)

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Trade debtors that are past due but not impaired: Past due < 3 months and not impaired 23,661 12,009 - - Past due 3 - 6 months and not impaired 2,713 11,480 - - Past due > 6 months and not impaired 15,211 7,976 - - 41,585 31,465 - -

Analysis of allowance for doubtful debts - Trade: At 1 January 837 782 - - Charge for the year 4 97 - - Write-off against allowance (7) (69) - - Exchange differences on consolidation (2) 27 - - At 31 December 832 837 - -

Analysis of allowance for doubtful debts - Non-trade: At 1 January 23,660 23,499 - - Charge/(write-back) for the year 405 (155) - - Exchange differences on consolidation (166) 316 - - At 31 December 23,899 23,660 - -

Advances to corporations in which the Group has equity 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 non-controlling shareholders of subsidiary companies are unsecured, have no fixed terms of repayment and are interest-free.

Advance to joint venture partner, which is secured by a banker’s guarantee and interest-free, has been repaid during the year.

Debtors are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 50,126 124,092 4,828 3,896 Renminbi 326,597 44,357 - - United States dollar 144,614 63,191 - - Vietnamese dong 30,101 28,004 - - Indonesian rupiah 8,751 12,735 - - Indian rupee 6,544 10,921 - - Philippines peso 2,255 2,382 - - Thai baht 2,652 4,662 - - Others 15,113 4,864 - - 586,753 295,208 4,828 3,896

Keppel Land Limited 220 Report to Shareholders 2010 24. Amounts Owing by/to Holding Company and Related Parties

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Advances owing by: Subsidiary companies - - 3,299,158 2,214,672 Associated companies 126,801 126,407 2,907 2,907 Related companies 8,468 7,894 4,000 4,249 135,269 134,301 3,306,065 2,221,828

Advances owing to: Subsidiary companies - - 5,240 8,772 Associated companies 2,844 65,269 - 58,297

Current accounts owing to holding and related companies 323 2,273 - - 3,167 67,542 5,240 67,069

Advances owing by/to subsidiary companies are non-trade related, unsecured and have no fixed terms of repayment. Interest-bearing advances of $2,722,524,000 (2009: $1,507,830,000) to subsidiary companies are charged at rates ranging from 0.10% to 4.78% (2009: 0.02% to 4.78%) per annum.

Advances owing by/to associated companies are non-trade related, unsecured and have no fixed terms of repayment. Interest-bearing advances of $11,662,000 (2009: $13,338,000) to associated companies are charged at 5.00% (2009: 3.54% to 5.00%) per annum. Interest-bearing advances of $1,518,000 (2009: $1,583,000) from associated companies are charged at rates ranging from 0.18% to 0.45% (2009: 0.15% to 0.41%) per annum.

Advances owing by subsidiary companies are denominated in the following currencies:

Company 2010 2009 $’000 $’000

Singapore dollar 3,290,472 2,212,597 United States dollar 11 - Philippines peso 8,675 2,075 3,299,158 2,214,672

Advances owing to subsidiary companies are denominated in the following currencies:

Company 2010 2009 $’000 $’000

Singapore dollar 4,947 4,903 Hong Kong dollar 293 3,869 5,240 8,772

Notes to the Financial Statements 221 Notes to the Financial Statements

24. Amounts Owing by/to Holding Company and Related Parties (continued)

Advances owing by associated companies are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 56,283 56,514 2,907 2,907 Renminbi 11,662 11,958 - - United States dollar 52,205 51,474 - - Philippines peso 6,651 6,461 - - 126,801 126,407 2,907 2,907

Advances owing to associated companies are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 2,844 61,207 - 58,297 Renminbi - 4,062 - - 2,844 65,269 - 58,297

Advances owing by related companies are interest-free, unsecured, have no fixed terms of repayment and are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 6,974 4,534 2,506 2,436 United States dollar 1,494 1,811 1,494 1,811 Hong Kong dollar - 1,547 - - Others - 2 - 2 8,468 7,894 4,000 4,249

Current accounts owing to holding and related companies are interest-free, unsecured, have no fixed terms of repayment and are largely denominated in Singapore dollars.

Keppel Land Limited 222 Report to Shareholders 2010 25. Cash and Cash Equivalents

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Fixed deposits with banks 480,411 429,374 - - Bank balances and cash 176,055 163,549 336 3,003 Deposits with related companies 932,580 299,788 18 269,050 1,589,046 892,711 354 272,053

Cash and cash equivalents are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 1,021,976 438,145 321 271,039 Renminbi 431,676 318,802 - - United States dollar 46,224 57,676 18 43 Vietnamese dong 26,496 25,516 - - Indonesian rupiah 29,709 19,056 - - Indian rupee 17,083 5,721 - - Philippines peso 9,766 11,149 - - Saudi Riyal 1,140 6,907 - - Others 4,976 9,739 15 971 1,589,046 892,711 354 272,053

Fixed deposits with banks and related companies mature in varying periods, substantially between 1 day to 3 months (2009: substantially between 1 day to 3 months) from the financial year-end. Fixed deposits with banks during the year bear interest at the following rates per annum: 2010 2009 Lowest Highest Lowest Highest % % % %

Singapore dollar 0.00 0.27 0.00 0.60 Renminbi 1.17 3.18 1.35 3.78 United States dollar 0.10 3.00 0.10 4.70 Vietnamese dong 4.50 14.00 1.40 18.00 Indonesian rupiah 3.50 8.00 4.25 12.15 Indian rupee 2.00 6.90 1.50 7.50 Philippines peso 2.75 3.75 3.50 5.75 Saudi Riyal 0.15 0.27 0.15 1.70

Interest rates on deposits with related companies are disclosed in Note 4.

Group 2010 2009 $’000 $’000

(a) Amounts held under project accounts, withdrawals from which are restricted to payments for expenditures incurred on projects 82,368 52,629

(b) Amounts held in escrow accounts for the acquisition of land overseas, payment of construction costs and progress billings received 24,141 54,898

Notes to the Financial Statements 223 Notes to the Financial Statements

26. Creditors

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Trade creditors 76,001 87,339 - - Loans from non-controlling shareholders of certain subsidiary companies 248,239 162,229 - - Income support payable to an associated company 53,895 53,557 - - Accrual for staff costs 58,162 36,332 - - Retention monies 41,425 30,997 - - Deposits received 42,293 24,325 - - Interest payable 10,237 7,413 7,093 2,534 Accrual for development costs and other payables 363,945 312,996 43,884 34,516 894,197 715,188 50,977 37,050

The loans from the non-controlling shareholders of certain subsidiary companies are unsecured and have no fixed terms of repayment. Interest-bearing loans from the non-controlling shareholders amounted to $119,187,000 (2009: $90,242,000) and interest is payable at rates ranging from 1.13% to 6.00% (2009: 1.25% to 4.64%) per annum.

Income support payable to an associated company represents the remaining income support top-up payments to be made by the Group to K-REIT Asia in respect of the disposal of the Group’s interests in two associated companies to K-REIT Asia.

Creditors are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 519,906 422,916 50,977 37,050 Renminbi 157,853 147,787 - - United States dollar 65,784 61,421 - - Vietnamese dong 21,313 21,849 - - Indonesian rupiah 19,462 22,061 - - Indian rupee 16,146 13,679 - - Saudi Riyal 88,027 20,052 - - Others 5,706 5,423 - - 894,197 715,188 50,977 37,050

Keppel Land Limited 224 Report to Shareholders 2010 27. Short-term Borrowings

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Unsecured borrowings under MTN Programme 20,000 248,000 20,000 248,000

Liability component of convertible bond 282,536 - 282,536 -

Bank borrowings: Secured 13,513 170,037 - - Unsecured 722 405,106 - 370,000 14,235 575,143 - 370,000

Unsecured loans from related company 21 10 - - 316,792 823,153 302,536 618,000

Unsecured borrowings under the MTN Programme comprise fixed rate notes with interest at 3.76% (2009: 3.00%) per annum. The balance as at 31 December 2009 also included floating rate notes with interest at 1.14% per annum, and were repriced every 6 months.

Secured bank borrowings are generally secured by: (a) mortgages on the borrowing subsidiary companies’ investment properties (see Note 16) and properties held for sale (see Note 21); and (b) assignment of all rights, titles and benefits with respect to some of the properties mortgaged.

Unsecured bank borrowings are repriced within 2 weeks to 3 months (2009: within 1 week to 8 months).

Convertible Bond The liability component of the convertible bond issued in 2006 (“2006 Bond”) is recognised on the balance sheet as follows:

Group and Company 2010 2009 $’000 $’000

At 1 January - - Reclassification from long-term borrowings (see Note 14) 275,925 - Interest expense (see Note 5) 14,111 - Interest paid (7,500) - At 31 December 282,536 -

Interest expense on the 2006 Bond is calculated based on the effective interest method by applying the interest rates of 4.78% (2009: 4.78%) per annum for an equivalent non-convertible bond to the liability component of the convertible bond. Details of the 2006 Bond are shown in Note 14.

Notes to the Financial Statements 225 Notes to the Financial Statements

27. Short-term Borrowings (continued)

Interest rates (per annum) on the Group’s borrowings, except for borrowings under the MTN Programme and convertible bond, are as follows:

2010 2009 Lowest Highest Lowest Highest % % % %

Secured bank borrowings denominated in: Singapore dollar - - 1.60 2.17 Indonesian rupiah 9.75 11.75 - - Thai baht - - 6.25 7.00

Unsecured bank borrowings denominated in: Singapore dollar - - 0.93 2.40 Vietnamese dong - - 10.00 21.00 Indonesian rupiah - - 9.88 14.88 Indian rupee 10.20 12.70 10.35 14.00

Short-term borrowings are denominated in the following currencies:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Singapore dollar 302,557 776,610 302,536 618,000 Vietnamese dong - 14,464 - - Indonesian rupiah 13,513 19,897 - - Indian rupee 722 745 - - Thai baht - 11,437 - - 316,792 823,153 302,536 618,000

28. Segment Reporting

For management purposes, the Group is organised into strategic business units based on their products, services and geography. The Group has four reportable operating segments as follows:

(a) Property trading − Develops residential properties and townships in Asia, primarily Singapore, China, Vietnam, India and Indonesia.

(b) Property investment − Owns/manages office and other commercial properties in Asia, primarily Singapore, Vietnam and Indonesia.

(d) Hotels and resorts, property services and others − Is the aggregate of the hotels and resorts operating segment, the property services operating segment and others.

Management monitors the results of each of the above operating segments for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on net profit or loss.

Information regarding the Group‘s reportable segments is presented below.

Keppel Land Limited 226 Report to Shareholders 2010 Hotels and Resorts, Property Property Property Fund Services, and Inter-segment Trading Investment Management Others Elimination Total 2010 $’000 $’000 $’000 $’000 $’000 $’000

External sales 579,583 70,200 68,723 73,767 - 792,273

Results Operating profit/(loss) 129,752 47,551 49,370 (3,746) - 222,927 Investment income 5,020 - - 405 - 5,425 Net interest income/(expenses) 7,767 (2,638) 266 (19,319) - (13,924) Share of results of associated companies 134,059 33,102 1,398 7,820 - 176,379 Gain on acquisition of additional interest in an associated company - - - 2,678 - 2,678 Corporate restructuring surplus - 363,848 - - - 363,848 Pre-tax profit/(loss) before fair value gain on investment properties/impairment 276,598 441,863 51,034 (12,162) - 757,333 Fair value gain on investment properties/impairment - 442,650 - (16,840) - 425,810 Pre-tax profit/(loss) after fair value gain on investment properties/impairment 276,598 884,513 51,034 (29,002) - 1,183,143 Taxation (58,930) (36,091) (11,144) (16,393) - (122,558) Profit/(loss) for the year 217,668 848,422 39,890 (45,395) - 1,060,585 Non-controlling interests (9,549) (13,751) - 8,546 - (14,754) Net profit/(loss) 208,119 834,671 39,890 (36,849) - 1,045,831

Other information Segment assets 4,249,745 2,660,454 133,962 3,403,151 (2,123,841) 8,323,471 Segment liabilities (2,006,713) (886,097) (33,665) (2,880,515) 2,123,841 (3,683,149) Net assets 2,243,032 1,774,357 100,297 522,636 - 4,640,322

Investment in associated companies 473,284 894,953 2,794 48,811 - 1,419,842 Additions to non-current assets * 77,687 260,667 1,083 31,829 - 371,266 Depreciation of fixed assets 3,624 292 184 4,907 - 9,007

Geographical information Other Singapore Countries Total $’000 $’000 $’000

External sales 172,387 619,886 792,273 Non-current assets 3,107,878 775,898 3,883,776

* Additions to non-current assets comprise investment in associated companies, purchase of fixed assets and expenditure on investment properties.

Notes to the Financial Statements 227 Notes to the Financial Statements

28. Segment Reporting (continued)

Hotels and Resorts, Property Property Property Fund Services, and Inter-segment Trading Investment Management Others Elimination Total 2009 $’000 $’000 $’000 $’000 $’000 $’000

External sales 720,774 75,361 42,749 84,985 - 923,869

Results Operating profit/(loss) 137,600 49,757 23,932 (9,364) - 201,925 Investment income 2,800 - - 333 - 3,133 Net interest income/(expenses) 9,694 (5,280) 109 (14,345) - (9,822) Share of results of associated companies 136,782 19,464 1,729 6,228 - 164,203 Gain on acquisition of additional interest in an associated company - - - 11,102 - 11,102 Pre-tax profit/(loss) before fair value loss on investment properties 286,876 63,941 25,770 (6,046) - 370,541 Fair value loss on investment properties - (11,977) - - - (11,977) Pre-tax profit/(loss) after fair value loss on investment properties 286,876 51,964 25,770 (6,046) - 358,564 Taxation (61,323) 3,628 (4,272) 2,733 - (59,234) Profit/(loss) for the year 225,553 55,592 21,498 (3,313) - 299,330 Non-controlling interests (29,138) 6,833 - 3,391 - (18,914) Net profit 196,415 62,425 21,498 78 - 280,416

Other information Segment assets 3,374,967 2,415,643 111,675 2,725,805 (2,076,313) 6,551,777 Segment liabilities (1,644,774) (607,504) (19,061) (2,568,149) 2,076,313 (2,763,175) Net assets 1,730,193 1,808,139 92,614 157,656 - 3,788,602

Investment in associated companies 425,033 919,978 30,300 57,138 - 1,432,449 Additions to non-current assets * 43,023 365,161 23 3,024 - 411,231 Depreciation of fixed assets 3,894 349 90 5,121 - 9,454

Geographical information Other Singapore Countries Total $’000 $’000 $’000

External sales 452,094 471,775 923,869 Non-current assets 3,358,566 715,305 4,073,871

* Additions to non-current assets comprise investment in associated companies, purchase of fixed assets and expenditure on investment properties.

Keppel Land Limited 228 Report to Shareholders 2010 29. Capital and Lease Commitments

Group 2010 2009 $’000 $’000

(a) Estimated development costs for properties for sale: (i) Contracted for 1,101,624 823,654 (ii) Not contracted for 1,645,176 1,052,563 2,746,800 1,876,217 Non-controlling interests (256,745) (285,864) 2,490,055 1,590,353

(b) Estimated funding in associated companies 1,040,175 1,354,817

(c) Capital expenditure contracted on investment properties 248,252 323,957 Non-controlling interests (30,860) (77,936) 217,392 246,021

(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 2010 2009 $’000 $’000

Within 1 year 65,425 51,817 Between 1 to 5 years 78,869 47,974 After 5 years 49,912 60,648 194,206 160,439

Generally, the Group’s non-cancellable leases are for terms of 3 years (2009: 3 years).

30. Contingent Liabilities

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Unsecured guarantees given to financial institutions in connection with facilities given to: (a) Subsidiary companies - - 286,681 12,610 (b) Associated companies 7,260 7,606 1,949 2,011 (c) Certain end-purchasers of overseas residential properties 49,836 39,645 - - Non-controlling interests (13,716) (9,956) - - 36,120 29,689 - -

The financial effects of FRS 39 relating to financial guarantee contracts issued by the Group and the Company are not material to the financial statements and are, therefore not recognised.

No material losses under these guarantees are expected.

Notes to the Financial Statements 229 Notes to the Financial Statements

31. Significant Related Party Transactions

(a) Significant related party transactions entered into by the Group with the holding company and related parties are as follows:

With Holding With With Holding With Company Group’s Company Group’s and Related Associated and Related Associated Companies Companies Companies Companies 2010 2010 2009 2009 $’000 $’000 $’000 $’000

Interest income 272 14,157 777 19,374 Interest expense: Charged to profit and loss account (119) - (722) - Capitalised under development cost (2,225) - (10,554) - Management fees paid (5,237) - (3,922) - Rental expense (3,666) - (3,029) - Project development and management fees received 1,734 1,292 2,108 18,724 Property management fees received 2,043 79 1,974 75 Marketing commission received 5,504 4,048 3,886 2,227 Management and support service fees received 7,144 451 3,743 475 Asset management fees received 35,879 - 14,220 - Other products and service fees paid (717) - (507) - Consideration for acquisition of a property - (573,000) - - Aggregate consideration for disposal of interest in an associated company - 1,399,221 - -

(b) Transactions entered into by the Group with the Temasek Group:

2010 2009 $’000 $’000

Rental received 214 243 Management fees paid - (257) Consideration for disposal of interest in an associated company 5,698 -

2010 2009 $’000 $’000

Consideration for the sales of units in Singapore and overseas residential development to Directors of the Company and/ or their immediate family members at prevailing prices applicable to third parties 1,209 4,577

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 230 Report to Shareholders 2010 32. 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’s 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 whenever it is appropriate.

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 whenever it is appropriate.

As at 31 December 2010, 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% (2009: 0.5%) with all other variables, including tax rate, being held constant, the Group’s profit after taxation will be lower/higher by $5,002,000 (2009: $5,324,000).

(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’s profit.

As at 31 December 2010, the Group has outstanding forward currency contracts of nominal amounts of USD47 million (2009: Nil) to hedge its risk in respect of management fees receivables in this currency. The derivative asset on these forward contracts is as shown in Note 23.

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 231 Notes to the Financial Statements

32. Financial Risk Management (continued)

(b) Foreign Currency Risk (continued)

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:

2010 2009 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 96,091 205 679 - 30,101 56,163 52 385 - 28,004 Cash and cash equivalents 37,996 30 1,103 36 26,496 42,796 63 445 65 25,516 Long-term investments 111,241 - - - - 67,783 - - - -

Financial Liabilities Creditors (37,367) (21) (4,180) - (21,313) (40,857) (27) (5,753) - (21,849) Borrowings - - - - (27,052) - - - - (14,464)

Sensitivity analysis for currency risk:

If the relevant foreign currencies change against the respective functional currencies of the Group entities by 5% (2009: 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:

Profit after Taxation Increase/(Decrease) 2010 2009 $’000 $’000

USD against SGD - strengthened 10,398 6,294 - weakened (10,398) (6,294)

RMB against SGD - strengthened 11 4 - weakened (11) (4)

IDR against SGD - strengthened (120) (246) - weakened 120 246

INR against SGD - strengthened 2 3 - weakened (2) (3)

VND against USD - strengthened 412 860 - weakened (412) (860)

Keppel Land Limited 232 Report to Shareholders 2010 (c) Credit Risk

Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations.

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 and other 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 and convertible bonds to fund working capital requirements and capital expenditure/investments.

Notes to the Financial Statements 233 Notes to the Financial Statements

32. Financial Risk Management (continued)

(d) Liquidity Risk (continued)

The following table summarises the maturity profile of the Group’s and the Company’s financial assets and liabilities at the balance sheet date based on contractual undiscounted repayment obligations.

2010 2009 Between Between Within 1 to 5 After Within 1 to 5 After 1 Year years 5 Years Total 1 Year Years 5 Years Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

GROUP Financial Assets Long-term investments - - 111,338 111,338 - - 67,884 67,884 Loans and receivables 2,293,133 446,161 - 2,739,294 1,301,522 940,708 - 2,242,230 2,293,133 446,161 111,338 2,850,632 1,301,522 940,708 67,884 2,310,114

Financial Liabilities Trade and other payables 897,364 - - 897,364 782,730 - - 782,730 Borrowings 334,256 2,121,233 100,000 2,555,489 823,153 927,645 - 1,750,798 1,231,620 2,121,233 100,000 3,452,853 1,605,883 927,645 - 2,533,528

Total net undiscounted financial assets/ (liabilities) 1,061,513 (1,675,072) 11,338 (602,221) (304,361) 13,063 67,884 (223,414)

COMPANY Financial Assets Long-term investments - - 7,254 7,254 - - 6,221 6,221 Loans and receivables 3,306,596 - - 3,306,596 2,493,884 - - 2,493,884 3,306,596 - 7,254 3,313,850 2,493,884 - 6,221 2,500,105

Financial Liabilities Trade and other payables 56,217 - - 56,217 104,119 - - 104,119 Borrowings 320,000 1,220,000 100,000 1,640,000 618,000 370,000 - 988,000 376,217 1,220,000 100,000 1,696,217 722,119 370,000 - 1,092,119

Total net undiscounted financial assets/ (liabilities) 2,930,379 (1,220,000) (92,746) 1,617,633 1,771,765 (370,000) 6,221 1,407,986

Keppel Land Limited 234 Report to Shareholders 2010 (e) Categories of Financial Assets and Financial Liabilities

The following table sets out the financial instruments as at the balance sheet date:

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Financial Assets Available-for-sale financial assets 111,338 67,884 7,254 6,221 Loans and receivables (including cash and cash equivalents) 2,739,294 2,242,230 3,306,596 2,493,884

Financial Liabilities Liabilities carried at amortised carrying value 3,413,825 2,509,453 1,657,189 1,068,044

(f) 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 net debt-equity 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 non-controlling interests in subsidiary companies.

Group Company 2010 2009 2010 2009 $’000 $’000 $’000 $’000

Net debt 927,415 834,012 1,600,618 691,872 Total capital 4,640,322 3,788,602 3,021,177 2,861,969 Net debt-equity ratio (times) 0.20 0.22 0.53 0.24

Notes to the Financial Statements 235 Notes to the Financial Statements

33. 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, trade and other debtors, creditors, amounts owing by/to related companies and short-term borrowings.

The fair values of the long-term borrowings as at 31 December 2010 are as stated below. They are estimated using discounted cash flow analysis based on current rates for similar types of borrowing arrangements.

2010 2009 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

Long-term borrowings 2,199,669 2,205,576 1,298,436 1,304,343 903,570 924,826 345,925 367,181

Amounts owing by associated companies are charged at floating interest rates and their carrying amounts approximate their fair values.

Fair Value Measurement The Group classifies fair value measurement using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. There are three fair value hierarchy levels, as follows: (a) Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities; (b) Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and (c) Level 3 – Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The following table shows an analysis of financial instruments carried at fair value by fair value hierarchy level:

2010 2009 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

GROUP Available-for-sale financial assets - Equity instruments 68 - 111,270 111,338 72 - 67,812 67,884

Derivative financial instruments - Forward currency contracts - 4,701 - 4,701 - - - - 68 4,701 111,270 116,039 72 - 67,812 67,884

COMPANY Available-for-sale financial assets - Equity instruments - - 7,254 7,254 - - 6,221 6,221

There have been no transfers between Level 1, Level 2 and Level 3 during 2010 and 2009.

Keppel Land Limited 236 Report to Shareholders 2010 Determination of Fair Value Quoted equity instruments (see Note 20): Fair value is determined directly by reference to their published market bid price at the balance sheet date.

Unquoted equity instruments (see Note 20): The fair value of investments that are not traded in an active market is determined by reference to the underlying net asset value of the investee companies.

Derivative financial instruments (see Note 23): The fair value of forward currency contracts is based on the over-the-counter rates.

Movement in Level 3 Financial Instruments The following table presents the reconciliation for all financial instruments measured at fair value based on significant unobservable inputs:

Group Company U unquoted Equity Unquoted Equity Instruments Instruments 2010 2009 2010 2009 $’000 $’000 $’000 $’000

At 1 January 67,812 60,876 6,221 4,387 Transfer from investment in associated company 28,689 - - - Net fair value gains recognised in other comprehensive income 1,883 953 1,033 1,087 Purchases 12,886 5,236 - - Redemption of shares by an investee company - (596) - (596) Capitalisation of advances - 1,343 - 1,343 At 31 December 111,270 67,812 7,254 6,221

34. Comparatives

The following comparative amounts for the Group for the year ended 31 December 2009 have been reclassified to conform with current year’s presentation in connection with the adoption of amendments to FRS 7 Statement of Cash Flows.

As Previously As Reported Reclassified $’000 $’000

Consolidated Cash Flow Statement Investing Activities Acquisition of non-controlling interests (3,813) -

Financing Activities Acquisition of non-controlling interests - (3,813)

Notes to the Financial Statements 237 Notes to the Financial Statements

35. Events Occurring After the Reporting Period

On 25 January 2011, the Group and Keppel Telecommunications & Transportation Ltd Group jointly announced the formation of a joint venture company to consolidate their data centre assets and position the business for further growth. In addition, the Group divested its interest in Keppel Digihub Limited for a consideration of approximately $19 million to the joint venture company in which the Group holds 30% interest.

The divestment is not expected to have any material impact on the net tangible assets per share or earnings per share of the Group for the financial year ending 31 December 2011.

36. Future Changes in Accounting Policies

The Group has not adopted the following standards/interpretations that have been issued but not yet effective:

Effective for Annual Periods Beginning Description on or after

Amendments to FRS 32 Financial Instruments: Presentation – Classification of Rights Issues 1 February 2010 INT FRS 119 Extinguishing Financial Liabilities with Equity Instruments 1 July 2010 Revised FRS 24 Related Party Disclosures 1 January 2011 Amendments to INT FRS 114 Prepayments of a Minimum Funding Requirement 1 January 2011 INT FRS 115 Agreements for the Construction of Real Estate 1 January 2011

Except for the revised FRS 24 and INT FRS 115, the Directors expect that the adoption of the other standards and interpretations above will have no material impact on the financial statements in the period of initial application. The nature of the impending changes in accounting policy on adoption of the revised FRS 24 and INT FRS 115 are described below.

Revised FRS 24 Related Party Disclosures The revised FRS 24 clarifies the definition of a related party to simplify the identification of such relationships and to eliminate inconsistencies in its application. The revised FRS 24 expands the definition of a related party and would treat two entities as related to each other whenever a person (or a close member of that person’s family) or a third party has control or joint control over the entity, or has significant influence over the entity. The revised standard also introduces a partial exemption of disclosure requirements for government-related entities. The Group is currently determining the impact of the changes to the definition of a related party has on the disclosure of related party transaction. As this is a disclosure standard, it will have no impact on the financial position or financial performance of the Group when implemented in 2011.

INT FRS 115 Agreements for the Construction of Real Estate On 26 August 2010, the Accounting Standards Council issued INT FRS 115 with an accompanying note that explains the application of the Interpretation to property development sales in Singapore by considering the Singapore legal framework. INT FRS 115 supersedes RAP 11 Pre-Completion Contracts for the Sale of Development Property and becomes effective for annual periods beginning on or after 1 January 2011. When adopted, INT FRS 115 is to be applied retrospectively.

Keppel Land Limited 238 Report to Shareholders 2010 INT FRS 115 clarifies when revenue and related expenses from a sale of real estate unit should be recognised if an agreement between a developer and a buyer is reached before the construction of real estate is completed. INT FRS 115 determines that contracts which do not classify as construction contracts in accordance with FRS 11 can only be accounted for using the percentage of completion (“POC”) method if the entity continuously transfers to the buyer control and the significant risks and rewards of ownership of the work in progress in its current state as construction progresses.

The Group’s current accounting policy for all residential property sales is to recognise revenue using the POC method as construction progresses. When the Group applies INT FRS 115 in 2011 retrospectively, the 2010 comparatives for revenue and net profit are expected to decrease by approximately $38.8 million and $12 million respectively. The properties held for sale as at 31 December 2010 is also expected to decrease by approximately $192.2 million.

RAP 11 Pre-completion Contracts for the Sale of Development Property For the current financial year, RAP 11 is still applicable in Singapore. 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 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 2010 2009 $’000 $’000

(Decrease)/increase in revenue recognised for the year (62,710) 240,555

Decrease in opening revenue reserves (282,348) (240,042)

Increase/(decrease) in profit for the year 57,856 (42,306)

Decrease in carrying value of properties held for sale: At 1 January (154,963) (274,396) At 31 December (192,237) (154,963)

(Decrease)/increase in non-controlling interests: At 1 January (37,446) (81,998) Share of results for the year (10,622) 44,552

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 240 to 244.

Notes to the Financial Statements 239 Significant Subsidiary and Associated Companies For the financial year ended 31 December 2010

Country of Effective Incorporation/ Equity Interest Place of 2010 2009 Business Principal 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 Castlehigh Pte Ltd 100 100 Singapore Investment holding D.L. Properties Ltd 65 65 Singapore Property investment Devonshire Development Pte Ltd* 60 60 Singapore Property development Evergro Properties Limited 100 100 Singapore Property investment and development Elaenia Pte Ltd 100 100 Singapore Investment holding Greenfield Development Pte Ltd Singapore Investment holding Ordinary shares 100 100 Preference shares 100 100 Harvestland Development Pte Ltd 100 100 Singapore Property development and investment 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 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 100 100 Singapore Investment holding Keppel China Township Development Pte Ltd Singapore Investment holding Ordinary shares 100 100 Preference shares 100 100 Keppel Digihub Ltd* 100 100 Singapore Property investment Keppel Land China Pte Limited (formerly known as 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 (Mayfair) Pte Ltd* 100 100 Singapore Property development 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

Keppel Land Limited 240 Report to Shareholders 2010 Country of Effective Incorporation/ Equity Interest Place of 2010 2009 Business Principal Activities % %

Subsidiary Companies Keppel Tianjin Eco-City Investments Pte Ltd 55 55 Singapore Investment holding Keppel Tianjin Eco-City Holdings Pte Ltd* 55 55 Singapore Investment holding Le-Vision Pte Ltd 100 100 Singapore Investment holding Mansfield Developments Pte Ltd 100 100 Singapore Property development 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 Limited* 100 100 Singapore Property/investment holding Ocean Properties Pte. Limited* 88 76 Singapore Property investment OIL (Asia) Pte Ltd Singapore Investment holding Ordinary shares 100 100 Preference shares 100 100 Pasir Panjang Realty Pte Ltd 100 100 Singapore Investment holding Portsville Pte Ltd 100 100 Singapore Investment holding Saigon Centre Holdings Pte Ltd Singapore Investment holding Ordinary shares 100 100 Preference shares 100 100 Sedona Hotels International Pte Ltd 100 100 Singapore Hotel and resort management Sherwood Development Pte Ltd 100 100 Singapore Property development 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 Tat Chuan Development (Pte) Ltd 100 100 Singapore Property development Third Dragon Development Pte Ltd* 100 100 Singapore Investment holding and marketing agent Wiseland Investment 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/Singapore Preference shares 100 100 Pembury Properties Ltd* (H) 100 100 British Virgin Investment holding Islands/Singapore Success View Enterprises Limited* (H) 55 55 British Virgin Investment holding Islands/China

Significant Subsidiary and Associated Companies 241 Significant Subsidiary and Associated Companies

Country of Effective Incorporation/ Equity Interest Place of 2010 2009 Business Principal Activities % %

Subsidiary Companies Beijing Kingsley Property Development Co Ltd* (G) 100 100 China Property development Changzhou Fushi Housing Development Pte Ltd* (G) 100 100 China Property development Chengdu Hillwest Development Co Ltd* (G) 100 100 China Property development Chengdu Hillstreet Development Co Ltd* (G) 100 - China Property development Chengdu Hilltop Development Co Ltd* (G) 100 - China Property development Jiangyin Evergro Properties Co Ltd* (G) 99 83 China Property development Jiangyin Yangtze International Country Club 95 95 China Golf club operations Co Ltd* (G) and development Keppel Bay Property Development (Shenyang) 100 - China Property development Co Ltd* (G) Keppel Hong Da (Tianjin Eco-City) Property 55 55 China Property development Development Co Ltd* (G) Keppel Township Development (Shenyang) 100 100 China Property development Co Ltd* (G) Shanghai Floraville Land Co Ltd* (G) 99 99 China Property development Shanghai Hongda Property Development Co Ltd* (G) 99 99 China Property development Shanghai Merryfield Land Co Ltd* (G) 99 99 China Property development Shanghai Minghong Property Co Ltd* (G) 99 99 China Property development Shanghai Pasir Panjang Land Co Ltd* (G) 99 99 China Property development Sunsea Yacht Club (Zhongshan) Co Ltd* (G) 80 80 China Development of marina lifestyle cum residential properties Tianjin Fulong Property Development Co Ltd* (G) 100 100 China Property development Tianjin Fushi Property Development Co Ltd* (G) 100 100 China Property development Tianjin Merryfield Property Development Co Ltd* (G) 100 100 China Property development Tianjin Pearl Beach International Country Club 100 100 China Golf course development Co Ltd* (G) Keppel Land (Saigon Centre) Ltd* (G) 100 100 Hong Kong Investment holding Sunseacan Investment (HK) Company Limited* (G) 80 80 Hong Kong Investment holding Keppel Puravankara Development Pvt Ltd* (A) 51 51 India Property development PT Kepland Investama* (E) 100 100 Indonesia Property investment/development 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 operations 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 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* (A) 51 51 Saudi Arabia Property development

Keppel Land Limited 242 Report to Shareholders 2010 Country of Effective Incorporation/ Equity Interest Place of 2010 2009 Business Principal Activities % %

Subsidiary Companies 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 Company Limited (A) 45 45 Thailand Property development/investment Thai-Kami Co Ltd* (A) 45 45 Thailand Property development Top Property Co Ltd* (A) 67 67 Thailand Property development Estella Joint Venture Company Limited* (A) 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 Quang Ba Royal Park Joint Venture Company* (F) 59 59 Vietnam Property investment Riviera Cove Joint Venture Limited Liability 60 60 Vietnam Property development Company* (A) Riviera Point Limited Liability Company* (A) 75 75 Vietnam Property development 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 Singapore Property development Bugis City Holdings Pte Ltd (Liquidated on 25.3.10) - 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* (45% up to 29.1.10) 46 45 Singapore Real estate investment trust Keppel Bay Pte Ltd (C) 30 30 Singapore Property development Keppel Group Eco-City Investments Pte Ltd (C) 35 35 Singapore Investment holding 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* (G) 50 50 Singapore Investment holding Substantial Enterprises Limited* (H) 35 35 British Virgin Investment holding Islands/China Cityone Development (Wuxi) Co Ltd* (G) 50 50 China Property development 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* (E) 20 20 Indonesia Property investment Jernih Rezeki Sdn Bhd* (Under liquidation) (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 Antilles Investment holding SM Keppel Land, Inc* (B) 20 20 Philippines Property development Dong Nai Waterfront City LLC* (A) 50 50 Vietnam Property development South Rach Chiec LLC* (A) 42 42 Vietnam Property development

Significant Subsidiary and Associated Companies 243 Significant Subsidiary and Associated Companies

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.

2. Associated companies are those in which the Group has significant influence, but not control, in the operating and financial policy decisions.

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. 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.

Keppel Land Limited 244 Report to Shareholders 2010 Corporate Information As at 16 March 2011

Board of Directors Remuneration Committee Company Secretary

Choo Chiau Beng (Chairman) Tan Yam Pin (Chairman) Choo Chin Teck

Kevin Wong Kingcheung Choo Chiau Beng (Group Chief Executive Officer) Khor Poh Hwa Registered Office Khor Poh Hwa Lim Ho Kee Lim Ho Kee 230 Victoria Street #15-05 Tsui Kai Chong Bugis Junction Towers Tsui Kai Chong Singapore 188024 Telephone: 6338 8111 Lee Ai Ming Facsimile: 6337 7168 Board Risk Committee Website: http://www.keppelland.com.sg Tan Yam Pin

Heng Chiang Meng Heng Chiang Meng (Chairman) Independent Auditors Edward Lee Kwong Foo Tsui Kai Chong

Koh-Lim Wen Gin Lee Ai Ming Ernst & Young LLP Public Accountants and Teo Soon Hoe Oon Kum Loon Certified Public Accountants Singapore Oon Kum Loon Audit Partner : Kevin Kwok (With effect from year ended Board Safety Committee 31 December 2007)

Audit Committee Tan Yam Pin (Chairman) Registrar Tsui Kai Chong (Chairman) Choo Chiau Beng

Lee Ai Ming Kevin Wong Kingcheung KCK CorpServe Pte Ltd 333 North Bridge Road #08-00 Heng Chiang Meng Khor Poh Hwa KH KEA Building Singapore 188721 Teo Soon Hoe Lee Ai Ming Telephone: 6837 2133 Facsimile: 6339 0218 Oon Kum Loon Edward Lee Kwong Foo

Koh-Lim Wen Gin Share Listing

Nominating Committee Brand Review Committee The Company’s shares are listed on the Singapore Exchange Securities Trading Lim Ho Kee (Chairman) Limited.

Choo Chiau Beng Choo Chiau Beng (Chairman)

Khor Poh Hwa Kevin Wong Kingcheung Tsui Kai Chong

Lee Ai Ming

Tan Yam Pin

Edward Lee Kwong Foo

Koh-Lim Wen Gin

Corporate Information 245 Profile of Directors and Senior Management

Board of Directors

Choo Chiau Beng, 63 Kevin Wong Kingcheung, 55

Mr Choo was appointed as the Chairman of Keppel Land Mr Wong has been the Group Chief Executive Officer/ Limited on 1 May 2009. He is the Chief Executive Officer of Managing Director, Keppel Land Limited since January 2000. Keppel Corporation Limited (“KCL”), and the Chairman of Prior to this appointment, Mr Wong was Executive Director Keppel Offshore and Marine Ltd, Keppel Energy Pte Ltd since November 1993. He is Deputy Chairman and Director and Keppel Land China Limited. He is also a Director of of K-REIT Asia Management Limited, and Deputy Chairman k1 Ventures Limited. of Keppel Land China Limited. He is a Board Member of the Building and Construction Authority (“BCA”), and Deputy Mr Choo started his career with Keppel Shipyard in 1971 Chairman of BCA Academy Advisory Panel. He is also a and rose through the ranks to his present position. Director of Prudential Assurance Company Singapore (Pte) Limited. He is a Board Member of Energy Studies Institute, a Board and Council Member of American Bureau of Shipping and Prior to joining Keppel Land Limited, Mr Wong had diverse the Chairman of Det Norske Veritas South East Asia experience in the real estate industry in the UK, USA and Committee. He is a member of the American Bureau of Singapore. Shipping’s Southeast Asia Regional Committee, Special Committee on Mobile Offshore Drilling Units, and Singapore Mr Wong holds a Bachelor Degree in Civil Engineering University of Technology and Design’s Board of Trustee. with First Class Honours from Imperial College, London, and a Master Degree from the Massachusetts Institute of Mr Choo was conferred the Public Service Star Award (BBM) Technology, USA. in August 2004, The Meritorious Service Award in 2008 and The NTUC Medal of Commendation (Gold) Award in May 20 07. Khor Poh Hwa, 61 He is Singapore’s Non-Resident Ambassador to Brazil. Mr Khor is an adviser to KCL in township and infrastructure Mr Choo holds a Bachelor of Science (First Class Honours) development, and a Director of Keppel Land Limited since Degree from the University of Newcastle upon Tyne (awarded 1998. He is also a Director of Keppel Land China Limited. the Colombo Plan Scholarship to study Naval Architecture) He is currently the Chairman of Keppel Infrastructure Fund and a Master of Science Degree in Naval Architecture Management Pte Ltd which is the Trustee-Manager of the from the University of Newcastle upon Tyne. He attended listed K-Green Trust. He also sits on the listed Hock Lian the Programme for Management Development in Harvard Seng Holdings Limited as an independent Director. Business School in 1982 and is a Member of the Wharton Society of Fellows, University of Pennsylvania. He is the immediate past President of the Singapore-Suzhou Club as well as the Society of Project Managers.

Mr Khor is a civil engineering graduate with Bachelor and Master Degrees from the National University of Singapore.

Keppel Land Limited 246 Report to Shareholders 2010 Lim Ho Kee, 66 Lee Ai Ming, 56

Mr Lim is a Director of Keppel Land Limited. He is the Mrs Lee has been a Director of Keppel Land Limited since Chairman of Singapore Post Limited and a Director of a November 2002 and currently serves on the Audit and number of private and public companies including Jardine Board Safety Committees. She is also a Director of K-REIT Cycle & Carriage Limited and MCL Land. He was a Director Asia Management Limited since 28 November 2005. She is of Singapore Telecommunications Limited from October 1986 currently a senior partner of the law firm, Rodyk & Davidson. to September 2000 as well as the Chairman of its Finance She has practised law for more than 20 years in the areas and Investment Committee. He was also previously Chairman of commercial litigation, real estate and intellectual property. of UBS (East Asia) and a Member of the group executive Mrs Lee is also an independent Director, the Chairperson board in Zurich. of the Nominating Committee and a Member of the Audit Committee of HTL International Holdings Limited. Mr Lim served on the Board of the Civil Service College as well as the Singapore Government’s Public Sector Mrs Lee serves in leadership roles on various other forums, Divestment Committee in 1987. He also sat on the Singapore including the Singapore Law Society, The Singapore Government’s Economic Planning Committee from Copyright Tribunal, the Federation Internationale des Conseils December 1989 to October 1991. He was a member of the en Propriété Industrielle: Asian Patent Attorney’s Association Committee on Singapore’s Competitiveness from May 1997 and International Trade Marks Association. to October 1998. Mrs Lee holds a Bachelor of Laws (Honours) Degree from the Mr Lim studied at the London School of Economics where University of Singapore, and is an Advocate & Solicitor of the he obtained his Bachelor of Science (Economics) Honours Supreme Court of Singapore. Degree in 1968.

Tan Yam Pin, 70 Tsui Kai Chong, 55 Mr Tan was appointed to the Board on 1 June 2003. A Professor Tsui has been a Director of Keppel Land Limited Chartered Accountant by profession, he retired as the since 2001. He is also the Chairman of K-REIT Asia Managing Director of the Fraser and Neave Group in October Management Limited and a Director of Fullerton Fund 2002. Management Company Ltd. He is currently the Provost and Professor of SIM University. He is a Member of the Board of Mr Tan is a Director of Great Eastern Holdings Limited, Governors of IP Academy, Singapore. Singapore Post Limited, Leighton Asia Limited (Hong Kong) and Blue Scope Steel Limited (Australia). He has been a He received his PhD in Finance from New York University Member of the Singapore Public Service Commission since in 1988 and his Chartered Financial Analyst qualification in 1990. He was a former Board Member of the East Asiatic 1993. Company Limited A/S (Denmark) until March 2006.

Mr Tan holds a Bachelor of Arts (Honours) Degree in Economics from the University of Singapore and a Master of Business Administration Degree from the University of British Columbia, Canada. He is a Fellow of the Canadian Institute of Certified Accountants, Canada.

Profile of Directors and Senior Management 247 Profile of Directors and Senior Management

Board of Directors (continued)

Heng Chiang Meng, 65 Edward Lee Kwong Foo, 64

Mr Heng was appointed to the Board on 1 March 2005. He Mr Lee was appointed to the Board on 1 July 2006. holds directorships in various listed companies including Macquarie International Infrastructure Fund Ltd, Orchard He became Singapore’s Ambassador to Indonesia in 1994 Parade Holdings Limited and Academies Australasia Group and retired on 1 July 2006 after 36 years of service with Ltd (formerly known as Garratt’s Ltd). He also sits on the the Foreign Service Branch of the Singapore Administrative Board of Jurong Port Private Ltd, a subsidiary of Jurong Service in various senior positions across Asia-Pacific. Town Corporation. Since his first posting to Indonesia in 1974, Mr Lee served Mr Heng began his career in the financial sector in 1970 a total of 18 years in the Singapore Embassy in Jakarta. He after graduating with a Bachelor of Business Administration also served as Ambassador to the Philippines from 1990 to (Honours) Degree from the University of Singapore. 1993, as well as High Commissioner to Brunei Darussalem from 1984 to 1990. He has held senior positions in several financial institutions including Citibank NA, the Monetary Authority of Singapore For his long-standing contributions to the Public Service, and Overseas Union Bank Limited. His other major area of Mr Lee was honoured with several accolades including experience was in real estate, having been Managing Director the Public Administration Medal (Silver) in 1996, the Public of First Capital Corporation Limited, Executive Director in the Administration Medal (Gold) in 1998, the Long Service Medal Far East Organization Group and Group Managing Director of in 1997 and the Meritorious Service Medal in 2006. Lim Kah Ngam Limited. In 1993, Mr Lee was conferred the diplomatic rank of Datu Mr Heng served four terms as a Member of Parliament from (Grand Cross) of the Order of Sikatuna by the Philippine 1984 to 2001 during which he chaired the Government Government in recognition of his efforts in promoting bilateral Parliamentary Committees for Communications and relations between the Philippines and Singapore. the Environment as well as the Ang Mo Kio-Cheng San Community Development Council and Cheng San Town In 2007, he was conferred the highest civilian award by the Council. Indonesian Government – the Bintang Jasa Utama (the Star of Excellent Services) for his many years of contribution towards building up stronger and closer relations between Singapore and Indonesia.

Mr Lee is Chief Executive of PT Ekalimintas, an investment consultancy firm and a member of the National University of Singapore President’s Philanthropic Advisory Council.

He holds a Bachelor of Arts (Honours) Degree from the University of Singapore and a Master of Arts Degree from Cornell University.

Keppel Land Limited 248 Report to Shareholders 2010 Koh-Lim Wen Gin, 66 Teo Soon Hoe, 61

Mrs Koh was appointed to the Board on 20 January 2010. Mr Teo is a Director of Keppel Land Limited and Keppel She is also a Director of Keppel Land China Limited. Land China Limited, a Senior Executive Director and the Group Finance Director of KCL and the Chairman of Keppel Mrs Koh has played a key role in shaping Singapore’s Telecommunications & Transportation Ltd, MobileOne cityscape through her career with the Urban Redevelopment Ltd and Keppel Philippines Holdings Inc. In addition, he is Authority (“URA”). She was URA’s Chief Planner and Deputy a Director of several other companies within the Keppel Chief Executive Officer between 2001 and 2008. Group, including Keppel Offshore and Marine Ltd, Keppel Infrastructure Fund Management Pte Ltd (the Trustee- Mrs Koh was involved in a variety of high quality landmark Manager of K-Green Trust), Keppel Energy Pte Ltd, developments which have contributed to Singapore’s growth Singapore Tianjin Eco-City Investment Holdings Pte. Ltd and as a global city. She was also instrumental in spearheading k1 Ventures Limited. the nation’s building conservation programme covering more than 6,800 heritage buildings. The programme was awarded Mr Teo began his career with the Keppel Group in 1975 the prestigious Global Award for Excellence by the Urban when he joined Keppel Shipyard. He rose through the ranks Land Institute in 2006. and was seconded to various subsidiary companies of the Keppel Group before assuming the position of Group Finance For her achievements, Mrs Koh was presented the Director in 1985. Meritorious Service Medal in 2009, the Public Administration Medal (Gold) in 2002 and the Public Administration Medal Mr Teo holds a Bachelor of Business Administration Degree (Silver) in 1986. from the University of Singapore and is a Member of the Wharton Society of Fellows, University of Pennsylvania. Mrs Koh has also served on several government boards such as the STB Hotel Licencing Board; Land Transport Authority Board; Board of Architects, Singapore; and Preservation of Monuments Board. She has also chaired many URA Design Oon Kum Loon, 60 Advisory Panels, Committees and Design Competition Juries. She continues to serve on the URA, Land Transport Authority Mrs Oon was appointed to the Board on 1 September 2010. and Public Utilities Board Advisory Panels. Mrs Oon has been an independent and non-executive Director of KCL since 2004. She is also the Chairperson of Mrs Koh graduated with a Bachelor of Architecture Degree KCL’s Board Risk Committee and a member of its Audit and from the University of Singapore in 1971. Remuneration Committees.

Mrs Oon is a veteran banker with about 30 years of experience and had held a number of management and executive positions with the DBS Group. She was the Chief Financial Officer (“CFO”) of the bank until September 2003.

Prior to the position of CFO at DBS Group, Mrs Oon was the Managing Director and Head of Group Risk Management, responsible for the development and implementation of a group-wide integrated risk management framework. During her career with the bank, she was also involved with treasury and markets, corporate finance and credit management activities. Mrs Oon’s other directorships include China Resources Microelectronics Limited, Singapore Power Limited and Aviva Ltd.

Mrs Oon holds a Bachelor of Business Administration (Honours) Degree from the University of Singapore.

Profile of Directors and Senior Management 249 Profile of Directors and Senior Management

Senior Management

Mr Tan is a Director of a number of subsidiary and associated Ang Wee Gee, 49 companies of the Keppel Land Group, including Asia No.1 Executive Director, Property Fund Ltd, Sedona Hotels International Pte Ltd Keppel Land International Limited and Raffles Quay Asset Management Pte Ltd. Mr Tan also and Executive Vice Chairman, holds alternate directorship to Mr Kevin Wong Kingcheung in Keppel Land China Limited K-REIT Asia Management Limited. Mr Ang joined Keppel Land Group in 1991. He is Executive In addition, he serves on the Board of the Singapore Green Vice Chairman of Keppel Land China Limited and Executive Building Council, the Management Council of Real Estate Director of Keppel Land International Limited. Keppel Land Developers’ Association of Singapore and the Workplace China Limited, a wholly-owned subsidiary company of Keppel Safety Health Council (Construction and Landscape Land Limited owns and independently operates the Group’s Committee). businesses in China. Mr Ang was previously the Executive Director and Chief Executive Officer, International responsible Mr Tan holds a Bachelor of Science Degree (First Class for the Group’s overseas businesses. He has previously held Honours) in Estate Management from the National University positions in business and project development for Singapore of Singapore and a Master of Business Administration Degree and overseas markets; corporate planning and development in Accountancy from the Nanyang Technological University. in the Group’s hospitality arm; was the Group’s country head for Vietnam; and had also concurrently headed Sedona Hotels International.

Augustine Tan Wee Kiong, 52 Mr Ang is the Chairman of Keppel Philippines Properties, Inc. President, Singapore Residential and Keppel Thai Properties Public Company Limited, property and Head, Regional Investments companies listed on the Philippine Stock Exchange and (India and Middle East) The Stock Exchange of Thailand respectively. He is a Director of Sedona Hotels International Pte Ltd, the hotel management Mr Tan joined Keppel Land Group in 1991 and was appointed arm of Keppel Land Limited, and a number of other subsidiary Chief Executive Officer, Singapore Residential on 1 January and associated companies in the Keppel Land Group. 2008, overseeing the Group’s residential developments and investments in Singapore and the Group’s marina Mr Ang holds a Master of Business Administration Degree developments, namely Marina at Keppel Bay in Singapore and from Imperial College, University of London. He received Nongsa Point Marina in Indonesia. Besides this role which he his Bachelor of Science Degree summa cum laude from the continues to hold as President, Singapore Residential, he is University of Denver, USA. also Head, Regional Investments, responsible for the Group’s property developments and investments in India and Middle East. Mr Tan’s previous appointments include Director of Singapore Residential and General Manager for Marketing, Tan Swee Yiow, 50 overseeing the marketing of the Keppel Land Group’s President, Singapore Commercial developments and investments in Singapore and overseas. and Head, Regional Investments (Indonesia, Malaysia and Myanmar) Prior to joining Keppel Land Group, Mr Tan had extensive experience in the design development and marketing of Mr Tan joined Keppel Land Group in 1990 and is concurrently commercial, retail, industrial and residential developments President, Singapore Commercial and Head, Regional with other listed real estate developers. Investments overseeing the Group’s commercial investment and development operations in Singapore, as well as regional Mr Tan holds a Master of Business Administration Degree presence in Indonesia, Malaysia and Myanmar. from the University of Birmingham, UK and a Bachelor of Science Degree in Estate Management from the National Prior to joining the Keppel Land Group, Mr Tan was with a University of Singapore. He is a Member of the Singapore banking group, advising on property valuation, taxation and Institute of Surveyors and Valuers, and is a Director of investment. Keppel Land International Limited and a number of other Keppel Land Group’s subsidiary and associated companies.

Keppel Land Limited 250 Report to Shareholders 2010 Loh Chin Hua, 50 Ng Hsueh Ling, 44 Managing Director, Chief Executive Officer, Alpha Investment Partners Limited K-REIT Asia Management Limited

Mr Loh has been the Managing Director of Alpha Investment Ms Ng has been the Chief Executive Officer and Executive Partners Limited (“Alpha”), the real estate fund management Director of K-REIT Asia Management Limited (“KRAM”) since arm of the Keppel Land Group, since September 2002. 17 August 2009. She has 21 years of experience in the real He is also a Director of Keppel Offshore and Marine Ltd estate industry. and Keppel Land China Limited. Her experience encompasses the strategic sourcing, He has served as an Executive Chairman in Asia Real investment, asset and portfolio management and Estate Fund Management Limited. He has over 20 years of development of assets in key Asian cities, as well as experience in real estate investing and fund management, extensive fund management experience in the areas of real spanning USA, Europe and Asia. estate fund product creation, deal origination, distribution and structuring of real-estate-based financial products. Prior to joining Alpha, Mr Loh was Managing Director at Prudential Investment Management Inc. (“Prudential”), and Prior to this appointment, Ms Ng has held key positions with led its Asian real estate fund management business. During two other real estate companies, CapitaLand Limited and his eight years at Prudential, Mr Loh was responsible for Ascendas Pte Ltd (“Ascendas”). Before her appointment as overseeing all investment and asset management activities Chief Executive Officer and Executive Director in KRAM, she for the real estate funds managed out of Asia. was Chief Executive Officer (Korea and Japan) at Ascendas.

Mr Loh started his career in real estate investment with the Ms Ng is a Licensed Appraiser for land and buildings and is Government of Singapore Investment Corporation (“GIC”). a Fellow of the Singapore Institute of Surveyors and Valuers. During his 10 years with GIC, he has held appointments in She holds a Bachelor of Science Degree in Real Estate from the San Francisco office and was head of the European real the National University of Singapore. estate group in London before returning to head the Asian real estate group.

Mr Loh, a Colombo Plan scholar, graduated from Auckland Lim Kei Hin, 53 University with a Bachelor of Property Administration and Chief Financial Officer Pepperdine University’s Presidential/Key Executive MBA Program. He is a Chartered Financial Analyst, and is also a Mr Lim was appointed the Chief Financial Officer of the registered valuer with the New Zealand Institute of Valuers. Keppel Land Group on 9 July 2007.

Prior to joining the Keppel Land Group, he was with Singapore Airlines Limited and has more than 20 years of diverse experience having served in different financial and general management roles in Singapore, the Philippines, Australia and the United States. His last appointment was Chief Financial Officer of Singapore Airport Terminal Services Limited.

Mr Lim holds a Bachelor of Science (Economics) Degree in Accounting & Finance (Honours) from the London School of Economics & Political Science, UK. He is a Director of a number of subsidiary and associated companies of the Keppel Land Group.

Profile of Directors and Senior Management 251 Profile of Directors and Senior Management

Edward Lee Kwong Foo Directors Asia Mobile Holdings Pte Ltd Details of the Directors’ present responsibilities and Indofood Agri Resources Ltd qualifications are set out on pages 246 to 249. Past principal Manhattan Resources Ltd directorships and appointments held by Directors in the last Gas Supply Pte Ltd five years are as follows:

Koh-Lim Wen Gin Choo Chiau Beng Preservation Monuments Board EDB Investments Pte Ltd Land Transport Authority Keppel Norway AS Maritime and Port Authority of Singapore Teo Soon Hoe Singapore Maritime Foundation Limited Keppel Shipyard Limited Singapore Petroleum Company Limited Singapore Petroleum Company Limited Singapore Refining Company Private Limited Travelmore Pte Ltd SMRT Corporation Ltd SMRT Buses Ltd Oon Kum Loon SMRT Light Rail Pte Ltd Schmidt Electronics Group Ltd SMRT Road Holdings Ltd Gas Supply Pte Ltd SMRT Trains Ltd PSA International Pte Ltd Nanyang Business School Advisory Board SP PowerGrid Ltd Kevin Wong Kingcheung HDB Corporation Private Limited Senior Management Singapore Hotel Association Details of senior management’s present responsibilities and Singapore International Chamber of Commerce qualifications are set out on pages 250 to 251. Past principal Various subsidiary and associated companies of directorships held by senior management in the last five years Keppel Land Limited are as follows: Khor Poh Hwa Ang Wee Gee PM Link Pte Ltd Various subsidiary and associated companies of PM Link (Suzhou) Pte Ltd Keppel Land Limited CPG FM (Suzhou) Pte Ltd China-Singapore Suzhou Industrial Park Tan Swee Yiow CPG Corporation Pte Ltd Various subsidiary and associated companies of Evergro Properties Limited Keppel Land Limited Lim Ho Kee Augustine Tan Wee Kiong Vertex Venture Holdings Ltd Various subsidiary and associated companies of Mentor Media Ltd Keppel Land Limited Singapore Shipping Corporation Limited CWT Limited Loh Chin Hua Transcu Group Ltd Pteris Global Limited Tan Yam Pin Ng Hsueh Ling The East Asiatic Company Limited Various subsidiary and associated companies of Singapore Food Industries Limited Ascendas Pte Ltd Certis Cisco Security Private Ltd Raffles Quay Asset Management Pte Ltd Power Seraya Limited Central Boulevard Development Pte Ltd Heng Chiang Meng Lim Kei Hin LKN-Primefield Limited Various subsidiary and associated companies of Singapore Jasper Investments Ltd Airport Terminal Services Limited Thakral Corporation Limited

Keppel Land Limited 252 Report to Shareholders 2010 Calendar of Financial Events

FY 2010

Announcement of Results: First Quarter 20 April 2010 Interim 20 July 2010 Third Quarter 20 October 2010 Total Year 24 January 2011

End of Financial Year 31 December 2010

Despatch of Summary Financial Report 23 March 2011

Despatch of Annual Report 6 April 2011

Annual General Meeting 21 April 2011

Dividend Payment Date Expected to be paid no later than 20 June 2011

FY 2011

Announcement of Results: First Quarter April 2011 Interim July 2011 Third Quarter October 2011 Total Year January 2012

End of Financial Year 31 December 2011

Despatch of Summary Financial Report March 2012

Despatch of Annual Report April 2012

Annual General Meeting April 2012

Dividend Payment Date June 2012

Calendar of FInancial Events 253 Corporate Structure As at 16 March 2011

Singapore Projects

100% 50% Keppel Land International Limited Asia Real Estate Fund Management Limited 100% Alpha Investment Partners Limited

100% Keppel Land Financial Services Pte Ltd

100% 88% Straits Property Investments Pte Ltd Ocean Properties Pte. Limited

100% Keppel Land Realty Pte Ltd

100% Harvestland Development Pte Ltd

100% Acresvale Investment Pte Ltd

100% Tat Chuan Development (Pte) Ltd

100% Mansfield Developments Pte Ltd

100% 33% Keppel Land K-REIT Asia Property Management Raffles Quay Asset Limited Pte Ltd Management Pte Ltd

100% K-REIT Asia Management Limited

100% 46% K-REIT Asia Investment Pte Ltd K-REIT Asia

100% Boulevard Development Pte Ltd 33% Marina Bay Residences Pte Ltd 100% Keppel Land Properties Pte Ltd 100% Bayfront Development Pte Ltd 33% Central Boulevard Development Pte Ltd 100% 52% Ocean & Capital Properties Pte Avenue Park Development Limited Pte Ltd

60% Devonshire Development Pte Ltd

100% Keppel Land (Mayfair) Pte Ltd

100% 50% Denton Investment Pte Ltd Parksville Development Pte Ltd

65% D.L. Properties Ltd

30% Keppel Bay Pte Ltd

30% Keppel Point Pte Ltd

Keppel Land Limited 254 Report to Shareholders 2010 Vietnam, Indonesia and Other Overseas Projects

100% 20% Silkland Investment Pte Ltd PT Purosani Sri Persada 100% 25% Flannigan Investment Pte Ltd PT Pulomas Gemala Misori

100% 50% Montfort Development Pte Ltd PT Pantai Indah Tateli 100% 80% Meadowsville Investment Pte Ltd PT Sentral Tunjungan Perkasa 100% 80% 100% Keppel Land International Limited PT Keppel Land PT Sentral Supel Perkasa

100% PT Kepland Investama

100% 51% 90% Bintan Bay Resort Pte Ltd Le-Vision Pte Ltd PT Mitra Sindo Sukses 51% 100% 51% Castlehigh Pte Ltd PT Mitra Sindo Makmur Straits-KMP Resort 100% Daysville Development Development Pte Ltd Pte Ltd 25% 30% Tropical Garden NV PT Purimas Straits Resorts 85% 95% 5% 35% 51% Straits-CM Village Hotel PT Ria Bintan Prestige Landmark Pte Ltd 100% Pte Ltd Pembury Properties Ltd 100% 100% Oil (Asia) Pte Ltd 90% 100% Jencity Ltd PT Straits-CM Village

100% Saigon Centre Investment Ltd Saigon Sports City Limited 50% 100% Saigon Centre Holdings Pte Ltd 50% Keppel Land (Saigon Centre) Ltd 68% 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 Keppel Land 100% Keppel Land Vietnam Properties 100% 60% Limited Pte Ltd Willowville Pte Ltd Keppel Land Agtex Limited 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% Portsville Pte Ltd Dong Nai Waterfront City LLC

100% 42% Flemmington Investments Pte Ltd South Rach Chiec LLC

100% Greenfield Development Pte Ltd 100% Straits Greenfield Ltd

100% Wiseland Investment Pte Ltd 100% Wiseland Investment Myanmar Ltd 40% 45% Renown Property Holdings (M) Tanah Sutera Development Sdn Bhd Sdn Bhd 100% 40% Buena Homes, Inc. Buena Homes (Sandoval) Inc. 51% Keppel Philippines Properties, Inc. 40% SM Keppel Land, Inc. 100% 39% Hampshire Pte Ltd Top Property Co Ltd 61% 100% Cornerstone Realty Co Ltd

45% Keppel Thai Properties Public 100% Gold Star Property Co Ltd Company Limited 100% Thai-Kami Co Ltd 100% 51% Keppel Land (Arabia) Pte Ltd Keppel Al Numu Development Ltd

100% Keppel Investment (Mauritius) Pte Ltd 51% Keppel Puravankara 100% Development Pvt Ltd Wisley Pte Ltd 38% Keppel Magus Development Pvt Ltd

* Keppel Land Limited owns 100% direct interest in the ordinary shares and 51% indirect interest in the preference shares of Elaenia Pte Ltd. 255 Corporate Structure Corporate Structure

China Projects

100% 100% 19% Kingsley Investment Pte Ltd Beijing Kingsley Property Tianjin Merryfield Property Development Co Ltd 81% Development Co Ltd

100% 99% Shanghai Merryfield Land Merryfield Investment Pte Ltd Co Ltd

100% Keppel Lakefront (Nantong) Property Development Co Ltd

23% Shanghai Hongda Property 68% Development Co Ltd 9%

100% 99% Shanghai Pasir Panjang Land 1% Shanghai Minghong Property 99% Pasir Panjang Realty Pte Ltd Co Ltd Co Ltd

40% CityOne Development (Wuxi) 30% Co Ltd

50% CityOne Township Development 51% Quivivet Pte Ltd Pte Ltd Keppel Land 10% Limited 83% Chengdu Century Development Co Ltd 100% 100% 100% 44% Jiangyin Evergro Properties 56% Keppel Land Evergro Properties Limited Third Dragon Holdings Pte Ltd China Limited * Co Ltd 100% Third Dragon Development 95% Jiangyin Yangtze International Pte Ltd Country Club Co Ltd

100% Tianjin Pearl Beach International Country Club Co Ltd 100% 5% 95% Tianjin Fushi Property Development Co Ltd 10% Changzhou Fushi Housing Tianjin Fulong Property Development Pte Ltd 90% Development Co Ltd

100% 80% 20% Da Di Investment Pte Ltd Keppel Bay Property Development (Shenyang) Co Ltd

100% 99% Shanghai Floraville Land Floraville Estate Pte Ltd Co Ltd

100% Chengdu Hillwest Development Co Ltd

100% 100% Hillwest Pte Ltd Chengdu Hillstreet Development Co Ltd

100% Chengdu Hilltop Development Co Ltd

* In the process of change from Keppel Land China Pte Limited

Keppel Land Limited 256 Report to Shareholders 2010 China Projects (continued)

100% Keppel China Township 100% Keppel Township Development Development Pte Ltd (Shenyang) Co Ltd 100% 50% Spring City Resort Pte Ltd Kingsdale Development Pte Ltd

100% Keppel China Marina Holdings 80% Sunseacan Investment (HK) 100% Sunsea Yacht Club Pte Ltd Company Limited (Zhongshan) Co Ltd

100% Success View Enterprises 100% Keppel Tianjin Eco-City Limited Holdings Pte Ltd 100% Keppel Hong Da (Tianjin Eco-City) Property Development Co Ltd

100% 100% Alpheus Enterprises Limited Keppel Tianjin Eco-City One Pte Ltd 100% Keppel Hong Xiang Keppel Land (Tianjin Eco-City) Limited Property Development Co Ltd

100% 100% Supreme Trade Enterprises 100% Keppel Tianjin Eco-City Two Keppel Land 55% Keppel Tianjin Eco-City Limited Pte Ltd China Limited * Investments Pte Ltd 100% Keppel Hong Yao (Tianjin Eco-City) Property Development Co Ltd

100% 100% Eminent Pro Enterprises Limited Keppel Tianjin Eco-City Three Pte Ltd

100% Apex Service Enterprises 100% Keppel Tianjin Eco-City Four Limited Pte Ltd

100% 100% Keppel Tianjin Eco-City Five Neva Enterprises Limited Pte Ltd

100% 35% Crystal Rise Investment Pte Ltd Substantial Enterprises Limited 40% 35% Keppel Group Eco-City 50% Singapore Tianjin Eco-City 50% Sino-Singapore Investments Pte Ltd Investment Holdings Pte Ltd Tianjin Eco-City Investment & Development Co Ltd

* In the process of change from Keppel Land China Pte Limited

Corporate Structure 257 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 87.5% 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 23,422 1992 99-year located in Raffles Place Properties leasehold

Keppel Bay Tower an 18-storey office building HarbourFront 11.7% 17,267 41,840 36,072 2002 99-year at HarbourFront Avenue One leasehold

HarbourFront Tower One an 18-storey office building HarbourFront 11.7% 10,923(a) 40,278 34,429 2002 99-year at HarbourFront Place Two leasehold

HarbourFront Tower Two a 16-storey office building HarbourFront 11.7% 10,923(a) 19,227 14,239 2003 99-year at HarbourFront Place Two leasehold

Marina Bay Financial Centre (Phase 1)(b) two office towers of 33 storeys K-REIT 46.2% 20,505(c) 63,000 54,105 2010 99-year and 50 storeys with ancillary Asia (1/3 (1/3 leasehold retail space at Marina Bay interest) interest)

Prudential Tower(b) a 30-storey office building K-REIT 46.2% 1,998 16,959 16,320 1998 99-year at Cecil Street Asia (73.4% (73.4% leasehold interest) interest)

Bugis Junction Towers(b) a 15-storey office tower K-REIT 46.2% - 27,724 22,876 1995 99-year at Bugis Junction Asia leasehold

One Raffles Quay(b) two office towers located K-REIT 46.2% 11,367 49,489 41,359 2006 99-year at the New Downtown at Asia (1/3 (1/3 leasehold Marina Bay interest) interest)

Keppel Towers and GE Tower two office towers Mansfield 100% 9,127 52,946 39,958 1991/ Freehold at Hoe Chiang Road Development 1993

Keppel Land Limited 258 Report to Shareholders 2010 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)

Caribbean at Keppel Bay a 969-unit luxurious waterfront Keppel Bay 30% 97,494 132,780 1,093 2004 99-year condominium development (retained leasehold at Keppel Bay interest)

The Promont a 15-unit apartment Tat Chuan 100% 1,039 2,909 374 2009 Freehold development at Development (retained Cairnhill Circle interest)

Nassim Woods a 35-unit luxurious Parksville 50% 5,785 9,256 8,468 1998 99-year condominium development Development leasehold in the exclusive Nassim Road enclave

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 - 3,041 1997 Freehold industrial building Development (retained at Upper Aljunied Link interest)

Orion Industrial Building a modern 8-storey Acresvale 100% 5,790 - 155 1997 Freehold industrial building Investment (retained at Paya Lebar interest)

Keppel Digihub a modern 6-storey Keppel Digihub 100% 7,333 18,345 13,019 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% 38,864 3,000 1,590 2007 99-year Keppel Bay (includes leasehold foreshore (Foreshore area) area - 30-year leasehold)

Property Portfolio 259 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 87.5% 2,557 95,992 78,587 2011 999-year located at Collyer Quay Properties leasehold corner of Raffles Place

Marina Bay Financial Centre (Phase 2) Central 33.3% 15,010(d) 150,393 120,314 2012 99-year a 46-storey office tower with Boulevard leasehold retail podium at Marina Bay Development

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

Madison Residences a 56-unit condominium Keppel Land 100% 4,568 10,294 - 2014 Freehold development at Realty Bukit Timah Road

Marina Bay Suites a 221-unit luxury Central 33.3% 5,300 43,607 - 2014 99-year condominium development Boulevard leasehold at the New Downtown Development

The Lakefront Residences a 629-unit condominium Keppel Land 100% 16,117 56,411 - 2015 99-year development at (Mayfair) leasehold Lakeside Drive Pte Ltd

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% 28,579 32,000 - - 99-year condominium development Three leasehold

Keppel Land Limited 260 Report to Shareholders 2010 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)/ N no. of Units (Residential)

Completed Properties

Australia 275 George Street a Grade A office Brisbane K-REIT Asia 46.2% 7,074 - 20,874 2009 Freehold building located in (50% Brisbane CBD interest)

77 King Street Office Tower a Grade A office Sydney K-REIT Asia 46.2% 1,284 - 13,752 1975 Freehold building located in Sydney CBD

China Office Development office units in Shanghai, Evergro 100% - 635 635 2004 50 years Chang Ning District China Properties lease

Jiangyin Yangtze International Country Club a golf course Jiangyin, Jiangyin 95% 957,281 - - 2006 40 years/ development China Yangtze 50 years International lease Country Club Co

Tianjin Pearl Beach International Country Club a golf course Tianjin, Tianjin 100% 787,405 - - 2006 40 years development in China Pearl Beach lease South Island International Country Club Co

Spring City Golf & Lake Resort an integrated resort Kunming, Spring 40% 2,884,749 2,649,802 Two 18-hole 1998 70 years comprising golf China City Golf 14,205 golf courses, 1998 lease courses, resort and a club house homes and Lake Resort Co resort facilities

Property Portfolio 261 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)/ N no. of Units (Residential)

Completed Properties (continued)

Indonesia Club Med Ria Bintan a beachfront hotel Bintan, PT Straits - 39% 200,000 - 302-room 1997 30 years at at Ria Bintan Indonesia CM Village hotel lease with Resort option for another 50 years

Ria Bintan (Phase 1) a 36-hole Bintan, PT 45.9% 1,467,000 - 36-hole 1998 30 years golf course Indonesia Ria Bintan golf course lease with with clubhouse option for another 50 years

Melia Purosani Hotel a 5-star hotel with Yogyakarta, PT Purosani 20% 18,189 26,398 296-room 1994 20 years retailwith Indonesia Sri Persada hotel lease outlets option for another 20 years

Nongsa Point Marina and Resort a waterfront resort Batam, PT Nongsa 17% 100,000 - 192 rooms/ 1995 30 years with a marina and Indonesia Point Marina chalets lease with hotel-style chalets and 65 berths option for another 50 years

Pasadenia Garden (Phase 1) a residential Jakarta, PT Pulomas 25% 32,586 32,490 198 units of 1996 30 years development Indonesia Gemala Misori strata-titled lease with within Pulomas condominium, option for residential district 50 units of another rental apartments 20 years and a 2-storey clubhouse

Keppel Land Limited 262 Report to Shareholders 2010 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)/ N no. of Units (Residential)

Completed Properties (continued)

International Financial Centre (Tower 1 ) a prime office Jakarta, PT Kepland 100% 10,444(f) 33,180 27,875 1985 20 years development Indonesia Investama lease with located in 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 and Sutera Utama, Skudai a township Johor, Tanah 18% 1,091,262 32,761 2,168 2003/ Freehold comprising Malaysia Sutera residential units, 2005/ residential units, Development 296 units of 2007/ commercial space shop offices, 2008/ and recreational 240 units of 2009/ facilities low cost flats 2010 and 4 commercial units

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 30 another office suites three 5-year extensions

Property Portfolio 263 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)/ N no. of Units (Residential)

Completed Properties (continued)

Sedona Hotel Mandalay an international Mandalay, Wiseland 100% 16,467 19,835 220 rooms 1998 30 years class hotel opposite Myanmar Investment and 27 BOT the famous ancient (Myanmar) serviced Mandalay Palace apartments

Philippines(j) Palmdale Heights a 29-block Pasig City, Buena 30.9% 22,978 47,063 828 2004 Freehold residential Philippines Homes (Phases (Phases residential development with (Sandoval) 1 & 2) 1 & 2) apartments with 4,000 apartment Inc. clubhouse units, 3 parking (Phases 1 & 2) buildings and 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 CBD, Keppel Land (Benguet (Benguet (Benguet Mandaluyang Inc. Centre) Centre) Centre) City, 26,767 18,518 2001 Philippines (Phase 1 - (Phase 1 - (Phase 1 - The Podium) The Podium) The Podium)

Sampaguita Ville 12 units of linked Cebu, Opon 20.2% 5,498 960 - 1996 Freehold houses Philippines Realty and Devt Corp

Thailand(k) Jewellery Centre a 34-storey Bangkok, Keppel Thai 45.5% 5,866 42,834 12,146 1993 Freehold strata titled Thailand Properties (retained commercial building interest) at Nares Road

Keppel Land Limited 264 Report to Shareholders 2010 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)/ N no. of Units (Residential)

Completed Properties (continued)

Sukhaphiban 3 Mansion a 19-storey Bangkok, Gold Star 45.5% 4,440 70,000 119 1994 Freehold strata-titled Thailand Property (retained residential apartment interest) at Sukhaphiban 3 Road

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 Land 68% 2,730 32,499 10,443 sm 1996 50 years cum serviced Minh City, Watco Co (office), lease apartment Vietnam 3,663 sm development at (retail), Le Loi Boulevard retail 305 sm in prime District 1 (post office), and 89 serviced apartments PetroVietnam 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 Texas, Houston located in the USA Group prestigious Galleria Partnership area of Houston

Property Portfolio 265 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)

China 8 Park Avenue a 930-unit Shanghai, Shanghai 99% 33,432 135,503 930 2014 70 years residential China Pasir residential lease development Panjang apartments complete with Land Co recreational facilities (Plot B)

Park Avenue Central third and final phase Shanghai, Shanghai 99% 28,488 - - - 70 years of Park Avenue China Floraville lease precinct Land Co (Plot C)

The Springdale a 2,667-unit Shanghai, Shanghai 99% 264,090 328,792 2,667 2015 70 years residential China Hongda residential lease development Property apartments 40 years with integrated facilities Development lease in Pudong District Co (commercial)

The Botanica an 9,479-unit Chengdu, Chengdu 44.05% 419,333 1,049,438 1,810 2011 70 years residential China Century residential units lease township Development (Phase 5) 2012 (residential) development with Co 1,248 40 years integrated facilities, residential units 2013 lease to be developed (Phase 6) (commercial) in phases 1,899 (Phase 7) residential units

Residential Development a 1,646 high-rise Chengdu, Chengdu 100% 50,782 202,800 1,646 2014 70 years residential China Hillstreet residential lease development Development units (residential) with some Co.,Ltd 40 years commercial lease component (commercial) in Jinjiang District

Keppel Land Limited 266 Report to Shareholders 2010 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 242-unit villa Chengdu, Chengdu 100% 249,385 87,266 242 villas 2014 70 years development China Hilltop lease with supporting Development (residential) clubhouse facilities Co.,Ltd in Xinjin County

Spring City Golf & Lake Resort an integrated resort Kunming, Spring 40% 2,157,361 10,928 La Quinta 2011 70 years comprising golf China City Golf and Ph 2 - lease courses, resort Lake Resort Co 62 resort homes and homes resort facilities

Central Park City a 4,984-unit Wuxi, CityOne 49.7% 352,534 671,053 1,627 2012 70 years residential township China Development residential (Phase 2) lease development with (Wuxi) Co units (residential) integrated facilities, (Phase 2) 40 years to be developed lease in phases (commercial)

The Seasons a 4,748-unit Shenyang, Keppel 100% 348,312 496,266 810 2013 50 years residential township China Township residential (Phase 1) lease with integrated Development units (residential) facilities in Shenbei (Shenyang) (Phase 1) 40 years New District in Co lease Shenyang, to be (commercial) developed over two phases

Township Development a 7,026-unit Shenyang, Keppel Bay 99.8% 302,681 756,580 7,026 2013 50 years residential township China Property residential lease withintegrated Development units (residential) facilities in Hunnan (Shenyang) (Phase 1) 40 years New District, to be Co lease developed over (commercial) six phases

Property Portfolio 267 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)

Zhongshan Marina an integrated Zhongshan, Sunsea 80% 871,700 408,000 300 villas 2012 70 years marina lifestyle China Yacht Club with private (Phase 1) lease development (Zhongshan) berths; (residential) Co 2,500 40 years apartment lease units (commercial)

Serenity Cove a 340-unit Tianjin, Tianjin 100% 128,685 80,000 28 units of 2013 70 years residential China Fushi (Phase 3) (Phase 3) bungalow, (Phase 3) lease development in Property 96 units of South Island Development semi-detached Co and 216 units of apartment (Phase 3)

Mixed Development a mixed Tianjin, Tianjin 100% 666,665 *** *** *** 40 years/ development China Fushi 70 years in North Island Property lease Development Co

Mixed Development a mixed Tianjin, Tianjin 100% 1,000,000 *** *** *** 40 years/ development in China Fulong 70 years North Island Property lease Development Co

Development in Sino-Singapore Tianjin Eco-City a mixed Tianjin, Keppel 55% 365,722(f) 692,500(f) estimated 2012/ 70 years / development, China Hongda (e) 5,000(g) 2013/ 40 years primarily residential (Tianjin residential 2014 lease together with some Eco-city) units commercial Property (office and retail) Development space Co

Keppel Land Limited 268 Report to Shareholders 2010 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)

Stamford City a mixed Jiangyin, Jiangyin 99.4% 74,713 272,894 359 2015 40-70 years development with China Evergro residential units lease residential, office Properties (Phase 2) and retail space to be Co 818 developed over residential units three phases (Phase 3)

Residential Development a 979-unit Nantong, Keppel 100% 172,215 189,437 979 units 2015 70 years residential China Lakefront lease development with (Nantong) a mix of villas, Property terrace houses, Development duplexes and Co high-rise apartments in Nantong, Jiangsu

India Elita Promenade a 1,573-unit Bangalore, Keppel 51% 96,618 193,236 1,573 2011 Freehold high-rise India Puravankara residential condominium Development apartments development in JP Nagar

Elita Horizon a 1,138-unit Bangalore, Keppel 51% 79,927 170,844 1,138 2017 Freehold high-rise India Puravankara residential condominium Development apartments development off Kanakapura Road

Elita Garden Vista a 1,278-unit Greater Keppel 37.7% 99,966 195,371 1,278 2011 Freehold high-rise Kolkata, Magus residential condominium India Development apartments development within Rajarhat Township

Property Portfolio 269 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)

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 Pasadenia Garden (Phase 2) a residential Jakarta, PT 25% 47,454 *** Residential *** 30 years development Indonesia Pulomas units lease with within the Gemala option for Pulomas district 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 Sukses residential (Phase 1) lease with in Cakung, (Site A - units option for East Jakarta Southern) (Phase 1 - 2013 another PT Mitra 971 units) (Phase 2) 20 years Sindo Makmur (Phase 2 - (Site B - 209 units and Northern) 340 housing plots for sale)

International Financial Centre (Tower 2 ) a prime office Jakarta, PT Kepland 100% 10,444(f) 56,000 ** 2014 20 years development Investama Investama lease with located in Jakarta option for CBD another 20 years

Galleria Tunjungan a retail/commercial Surabaya, PT Sentral 80% 23,253 *** *** *** 30 years complex in Indonesia Tunjungan lease with Surabaya Perkasa option for another 20 years

Keppel Land Limited 270 Report to Shareholders 2010 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)

Tanah Lot Resort an integrated resort Bali, PT 25.5% 858,110 *** Resort *** 30 years incorporating Indonesia Purimas bungalows lease with resort bungalows, Straits Resort (Phase 1) option for spa village and another recreational facilities 20 years

Malaysia Taman Sutera and Sutera Utama, Skudai a township Johor, Tanah 18% 3,717,082 - 133 2012 Freehold comprising Malaysia Sutera (59,243 residential and residential units, Development currently under units commercial space development) 46 units of and recreational facilities shop offices currently under development

Philippines(h) Palmdale Heights a 29-block Pasig City, Buena 30.9% 15,976 62,751 1,264 ** Freehold residential Philippines Homes (Phases (Phases apartment development with (Sandoval) 3 & 4) 3 & 4) units and 4,000 apartment Inc. 37,202 303 parking lots units, 3 parking (Phases (Phase 3 & 4) buildings and 5-8) 4,000 apartment 2 commercial units, buildings. To be 3,031 sm developed (commercial) and in phases 517 parking lots (Phases 5-8)

SM-KL Towers (Phase 2 onwards) two 55-storey office Ortigas SM 24.2% 12,932 ** ** ** Freehold towers and CBD, Keppel Land a 70-storey Mandaluyong Inc. residential tower, City, interlinked by Philippines a 5-storey retail podium called The Podium. To be developed in phases

Property Portfolio 271 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)

Vacant Land at Carajay Road Cebu, Opon 20.2% 7,838 - - - Freehold Philippines Realty and Development Corp

Saudi Arabla Al Mada Towers a 1,005-unit Jeddah, Keppel 51% 36,236 253,652 1,005 2015 Freehold high-rise Saudi Arabia Al Numu luxury residential Development development located along the prime Corniche waterfront area

Thailand(i) Villa Arcadia at Srinakarin a 367-unit Bangkok, Thai-Kami 45.5% 159,706 - 367 2012 Freehold detached housing Thailand detached development houses off Srinakarin Road

Villa Arcadia at Watcharapol a 270-unit detached Bangkok, TOP 66.7% 124,912 - 270 2012 Freehold housing Thailand Property(j) detached development at houses Watcharapol Road

Vietnam Saigon Centre (Phase 2) prime office space / Ho Chi Keppel Land 68% 17,156 ** ** 2013 50 years hotel /serviced Minh City, Watco Co lease apartments / Vietnam lifestyle retail at Le Loi Boulevard in prime District 1

Keppel Land Limited 272 Report to Shareholders 2010 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)

Tamarind Park a 20-storey Ho Chi Keppel Land 60% 2,808 26,181 173 2014 45 years apartment tower Minh City, Agtex apartment lease with recreational Vietnam units facilities in prime District 1

Saigon Sports City township with over Ho Chi Saigon 90% 640,477 827,000 3,000 2013 50 years 2,300 apartments, Minh City, Sports apartment (Phase 1) lease supporting Vietnam City units commercial (Phase 1 - complexes and 732 apartment public sports facilities units) in prime District 2

The Estella a 1,393-unit Ho Chi Estella 55% 47,906 279,851 1,393 2011 50 years high-rise residential Minh City, JV Co apartment (Phase 1) lease development with Vietnam units supporting (Phase 1 - commercial space 719 in An Phu Ward in residential units; prime District 2 Phase 2 - 674 residential units; Phase 3 - 37,005 sm commercial)

Residential Development a 1,500-unit Ho Chi Parc Riviera 60% 51,043 244,800 1,500 2014 50 years high-rise residential Minh City, JV Co. apartment lease development with Vietnam units; supporting 39,168 sm commercial space (Commercial) in District 2

Property Portfolio 273 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)

Waterfront Residential Township a 6,430-unit Ho Chi South Rach 42% 300,000 755,000 6,430 2014 50 years residential township Minh City, Chiec LLC residential (Phase 1) lease with supporting Vietnam units commercial space South Rach Chiec in prime District 2

Riviera Point a 2,400-unit Ho Chi Riviera 75% 85,118 447,000 2,400 2014 50 years high-rise residential Minh City, Point LLC apartment (Phase 1) lease development with Vietnam units; supporting 103,000 sm commercial space (Commercial) in District 7

Riviera Cove a 96-unit gated Ho Chi Riviera Cove 60% 97,000 34,711 96 villas 2012 50 years villa development Minh City, JV LLC lease in District 9 Vietnam

Waterfront Villa Development a gated waterfront Ho Chi * 60% 98,000 45,200 150 villas 2013 50 years villa development Minh City, lease in District 9 Vietnam

Dong Nai Waterfront City a 7,850-unit Dong Nai Dong Nai 50% 3,667,127 2,046,955 7,850 2015 50 years residential township Province, Waterfront City residential (Phase 1) lease with quality housing Vietnam LLC units and supporting commercial space in Long Hung, Long Thanh District

Keppel Land Limited 274 Report to Shareholders 2010

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)

Riviera Gardens a 174-unit gated Ho Chi * 60% 113,098 40,715 174 villas 2013 50 years villa development Minh City, lease located in Vietnam District 12

Waterfront Villa Development a waterfront villa Ho Chi * 50% 135,000 67,500 225 villas 2014 50 years development Minh City, lease in Saigon South Vietnam

(a) Comprises both HarbourFront Tower One and Two (b) Assets owned by K-REIT Asia in which the Group has a 46.2% stake (c) Comprises MBFC Phase 1 and Marina Bay Residences (d) Comprises MBFC Phase 2 and Marina Bay Suites (e) For residential component only (f) For entire site (g) Seasons Park (Part of Phase 1 of the 36.6 ha SUA ) comprising 1,672 units which was launched in 2010 (h) Assets owned by Keppel Philippines Properties Inc. in which the Group has a 51% stake (i) Assets owned by Keppel Thai Properties Co Ltd (KTP) in which the Group has a 45.5% stake (j) 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 * Pending set-up of holding company ** Under planning stage *** Plans are under review in accordance to market conditions

Property Portfolio 275 Statistics of Shareholdings As at 2 March 2011

Number of issued shares: 1,451,346,923 Class of shares: Ordinary shares with equal voting rights

Number of number of Size of Shareholdings Shareholders % Shares %

1 - 999 3,598 15.66 961,700 0.07 1,000 - 10,000 15,808 68.79 57,605,995 3.97 10,001 - 1,000,000 3,546 15.43 118,584,819 8.17 1,000,001 and above 27 0.12 1,274,194,409 87.79 Total 22,979 100.00 1,451,346,923 100.00

Number of number of Location of Shareholders Shareholders % Shares %

Singapore 21,928 95.43 1,441,676,584 99.33 Malaysia 678 2.95 5,535,162 0.38 Others 373 1.62 4,135,177 0.29 Total 22,979 100.00 1,451,346,923 100.00

Keppel Land Limited 276 Report to Shareholders 2010 Twenty Largest Shareholders N number of Shares %

1 Keppel Corporation Limited 760,321,368 52.39 2 Citibank Nominees Singapore Pte Ltd 154,422,981 10.64 3 DBS Nominees Pte Ltd 110,919,288 7.64 4 DBSN Services Pte Ltd 65,788,914 4.53 5 HSBC (Singapore) Nominees Pte Ltd 54,210,245 3.73 6 Raffles Nominees (Pte) Ltd 31,113,891 2.14 7 United Overseas Bank Nominees Pte Ltd 26,125,582 1.80 8 BNP Paribas Securities Services Singapore 14,774,545 1.02 9 Phillip Securities Pte Ltd 5,964,492 0.41 10 Merrill Lynch (Singapore) Pte Ltd 5,422,177 0.37 11 Bank Of Singapore Nominees Pte Ltd 5,165,180 0.35 12 Morgan Stanley Asia (Singapore) Pte Ltd 4,383,364 0.30 13 OCBC Nominees Singapore Pte Ltd 3,757,306 0.26 14 BNP Paribas Nominees Singapore Pte Ltd 3,721,912 0.26 15 OCBC Securities Private Ltd 3,470,475 0.24 16 Selat Pte Limited 3,315,011 0.23 17 DB Nominees (S) Pte Ltd 3,293,721 0.23 18 Royal Bank Of Canada (Asia) Limited 2,705,597 0.19 19 UOB Kay Hian Pte Ltd 2,704,682 0.19 20 Lee Pineapple Company Pte Ltd 2,000,000 0.14 Total 1,263,580,731 87.06

Substantial Shareholders

N number of Shares % 1 Temasek Holdings (Pte) Ltd (Deemed interest) 764,873,846 52.70 2 Keppel Corporation Limited (Including holdings by subsidiary companies) 760,321,368 52.39

Temasek Holdings (Pte) Ltd holds 21.5% 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.

Statistics of Shareholdings 277 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 Company will be held at Raffles City Convention Centre, Collyer Room, Level 4, 2 Stamford Road, Singapore 178882 on Thursday, 21 April 2011 at 11.00 a.m. to transact the following businesses:

AS ORDINARY BUSINESS

1. To receive and adopt the Directors’ Report and Audited Financial Statements for the year ended 31 December 2010. (Resolution 1)

2. To declare a final ordinary dividend of 9 cents per share and special dividend of 9 cents per share for the year ended 31 December 2010 (2009: Final ordinary dividend of 8 cents per share) to which the Dividend Reinvestment Scheme shall apply. (Resolution 2)

3. To re-elect the following Directors, who will retire pursuant to Article 94 or Article 100 of the Company’s Articles of Association and who, being eligible, are offering themselves for re-election (see Note 2):

Mr Lim Ho Kee (Resolution 3) Prof Tsui Kai Chong (Resolution 4) Mr Tan Yam Pin (Resolution 5) Mr Heng Chiang Meng (Resolution 6) Mrs Oon Kum Loon (Resolution 7)

4. To approve Directors’ fees of $789,000 for the year ended 31 December 2010 (2009: $667,000). (Resolution 8)

5. To re-appoint Messrs Ernst & Young as Auditors, and to authorise the Directors to fix their remuneration.(Resolution 9)

Keppel Land Limited 278 Report to Shareholders 2010 AS SPECIAL BUSINESS

6. To consider and, if thought fit, approve with or without modifications, the following resolutions which will be proposed as Ordinary Resolutions:

6.1 That pursuant to Section 161 of the Companies Act, Cap. 50 of Singapore (the “Companies Act”) and Article 8(B) of the Company’s Articles of Association, authority be and is hereby given to the Directors of the Company to:

(1) (a) 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

(b) make or grant offers, agreements or options that might or would require Shares to be issued (including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible into Shares) (collectively “Instruments”),

at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may in their absolute discretion deem fit; and

(2) (notwithstanding that the authority so conferred by this Resolution may have ceased to be in force) issue Shares in pursuance of any Instrument made or granted by the Directors of the Company while the authority was in force;

provided that:

(a) the aggregate number of shares to be issued pursuant to this Resolution (including Shares to be issued in pursuance of Instruments made or granted pursuant to this Resolution and any adjustment effected under any relevant Instrument) shall not exceed 50 per cent. of the total number of issued Shares (excluding treasury Shares) (as calculated in accordance with sub-paragraph (b) below), of which the aggregate number of Shares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed 20 per cent. of the total number of issued Shares (excluding treasury Shares) (as calculated in accordance with sub-paragraph (b) below);

(b) (subject to such manner of calculation as may be prescribed by the Singapore Exchange Securities Trading Limited (“SGX-ST”)) for the purpose of determining the aggregate number of Shares that may be issued under sub-paragraph (a) above, the percentage of issued Shares shall be calculated based on the total number of Shares (excluding treasury Shares) at the time this Resolution is passed, after adjusting for:

(i) new Shares arising from the conversion or exercise of convertible securities or share options or vesting of share awards which are outstanding or subsisting as at the time this Resolution is passed; and

(ii) any subsequent bonus issue, consolidation or sub-division of Shares;

Notice of Annual General Meeting 279 Notice of Annual General Meeting

(c) in exercising the authority granted under this Resolution, the Company shall comply with the provisions of the Companies Act, the Listing Manual of the SGX-ST 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;

(d) (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; (Resolution 10, see Note 3)

(e) 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:

(i) allot and issue from time to time, such number of Shares in the capital of the Company; and/or

(ii) 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. Resolution( 11, see Note 4)

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 280 Report to Shareholders 2010 (3) in this Ordinary Resolution:

“Maximum Limit” means that number of issued Shares representing 10 per cent. of the total number of issued Shares 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 shall be taken to be the total number of issued Shares 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 per cent. 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 per cent. 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 is/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. (Resolution 12, see Note 5)

Notice of Annual General Meeting 281 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 23 March 2011 (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 is/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. (Resolution 13, see Note 6)

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 2010 will be published on the Company’s website on 6 April 2011. The Company’s website address is http://www.keppelland.com.sg/ar2010.

NOTICE HAD BEEN GIVEN on 24 January 2011 that the Share Transfer Books and the Register of Members of the Company will be closed from 28 April 2011 after 5.00 p.m. to 3 May 2011 for the preparation of dividend warrants. Duly completed transfers in respect of ordinary shares in the capital of the Company (“Shares”) received by the Company’s registrar, KCK CorpServ Pte Ltd, 333 North Bridge Road #08-00, KH KEA Building, Singapore 188721 up to the close of business at 5.00 p.m. on 28 April 2011 will be registered to determine shareholders’ entitlement to the proposed final dividend. Shareholders whose securities accounts with The Central Depository (Pte) Limited are credited with Shares at 5.00 p.m. on 28 April 2011 will be entitled to the proposed final dividend.

By Order of the Board

CHOO CHIN TECK Company Secretary

Singapore, 23 March 2011

Keppel Land Limited 282 Report to Shareholders 2010 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 2010. Mr Lim Ho Kee will upon re-election, continue to serve as Chairman of the Nominating Committee, and member of the Remuneration Committee. Prof Tsui Kai Chong will upon re-election, continue to serve as Chairman of the Audit Committee, and member of the Remuneration, Board Risk and Brand Review Committees. Mr Tan Yam Pin will upon re-election, continue to serve as Chairman of the Remuneration and Board Safety Committees, and member of the Brand Review Committee. Mr Heng Chiang Meng will upon re-election, continue to serve as Chairman of the Board Risk Committee, and member of the Audit Committee. Mrs Oon Kum Loon will upon re-election, continue to serve as member of the Audit and Board Risk Committees. These Directors (other than Mrs Oon Kum Loon) are considered by the Nominating Committee to be independent Directors.

3. 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 further Shares and Instruments in the Company, up to a number not exceeding 50 per cent. of the total number of Shares (excluding treasury Shares) (with a sub-limit of 20 per cent. of the total number of Shares (excluding treasury Shares) in respect of Shares to be issued other than on a pro rata basis to shareholders).

4. Ordinary Resolution 11 is to empower the Directors to allot and issue Shares in the capital of the Company for the purposes of, in connection with or where contemplated by the Dividend Reinvestment Scheme.

5. 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 23 April 2010. Please refer to Appendix A of the circular to shareholders dated 23 March 2011 for details.

6. 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 23 March 2011 for details.

Notice of Annual General Meeting 283 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 2010 3.28 100.00 2,745 100.00 636 100.00 Feb 2010 3.28 100.00 2,751 100.22 632 99.37 Mar 2010 3.67 111.89 2,887 105.17 660 103.77 Apr 2010 3.75 114.33 2,975 108.38 667 104.87 May 2010 3.48 106.10 2,753 100.29 622 97.80 Jun 2010 3.90 118.90 2,836 103.32 638 100.31 Jul 2010 4.04 123.17 2,988 108.85 681 107.08 Aug 2010 3.88 118.29 2,950 107.47 674 105.97 Sep 2010 4.05 123.48 3,098 112.86 722 113.52 Oct 2010 4.43 135.06 3,143 114.50 731 114.94 Nov 2010 4.75 144.82 3,145 114.57 711 111.79 Dec 2010 4.80 146.34 3,190 116.21 730 114.78 Jan 2011 4.48 136.59 3,180 115.85 713 112.11

Normalised Values

150

125

100

50 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’s share started off at $3.28 in January 2010 and closed at $4.80 in December 2010. The movements in share price during the year are in tandem with the general trends for Straits Times Index and the FTSE ST Real Estate Index.

Keppel Land Limited 284 Report to Shareholders 2010 Turnover (million) Share Prices ($) (S$) 500 10.0

375 7.5

250 5.0

125 2.5

0 0 2006 2007 2008 2009 2010 2011

Turnover High and Low Prices

Straits Times and FTSE ST Real Estate Indices

Index 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 2005 2006 2007 2008 2009 2010 2011 0 Straits Times Index FTSE ST Real Estate Index

Share Transaction Statistics 285 Share Transaction Statistics

Investor Data

2006 2007 2008 2009 2010

Earnings per share (cents) (Note 1) 19.8 76.9 22.4 24.2 72.8 Dividend per share (cents) 6.0 8.0 8.0 8.0 9.0 Special dividend per share/distribution in specie (Note 2) 44.0 12.0 - - 9.0 Share price (cents) (Note 3) Highest 710 960 724 351 505 Lowest 360 655 131 99 321 Average 486 831 421 233 394 Last done 690 728 170 350 480 Turnover (million shares) 694.7 942.2 794.7 2,305.3 1,119.6 Dividend yield (%) (Note 4) 1.2 1.0 1.9 3.4 2.3 Dividend yield with special dividend (%) (Note 4) 10.3 2.4 1.9 3.4 4.6 Net price-earnings ratio (Note 1 and 4) 24.5 10.8 18.8 9.6 5.4 Net tangible assets per share ($) 2.21 3.18 3.39 2.36 2.97

Notes : 1. Earnings represent Group’s net profits. The earnings per share for 2006 to 2008 have been restated to include the effects of the Company’s rights issue in 2009. Consequently, the net price-earnings ratios for 2006 to 2008 have also been restated. 2. 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. 3. Share prices reflect transactions recorded on the Singapore Exchange Securities Trading Limited. 4. In calculating dividend yields and net price-earnings ratios, the average share prices have been used.

Keppel Land Limited 286 Report to Shareholders 2010 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. 2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all Keppel Land Limited intents and purposes if used or purported to be used by them. Co Reg No.: 189000001G 3. CPF investors who wish to attend the Annual General Meeting as observers must (Incorporated in the Republic of Singapore) submit their requests through their CPF Approved Nominees within the time frame specified. Any voting instructions must also be submitted to their CPF Approved Annual General Meeting Nominees within the time frame specified to enable them to vote on the CPF investor’s behalf.

I/We (name) of (address) being (a) Member(s) of Keppel Land Limited (the “Company”), hereby appoint:

name Address NRIC/ Proportion of Passport Number Shareholdings

No. of Shares %

and/or (delete as appropriate)

as my/our proxy/proxies to vote on my/our behalf at the Annual General Meeting of the Company to be held on 21 April 2011 at 11.00 a.m. at Raffles City Convention Centre, Collyer Room, Level 4, 2 Stamford Road, Singapore 178882. I/We direct my/our proxy/proxies to vote for or against the Resolutions to be proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given, the proxy/proxies will vote or abstain from voting at his/her discretion.

To be Used on a To be Used in the Show of Hands Event of a Poll No. Resolution

For* Against* number number Fold and glue along dotted line of Votes of Votes For** Against** Ordinary Business 1. To receive and adopt the Directors’ Report and Audited Financial Statements for the year ended 31 December 2010 2. To declare the final ordinary dividend of 9 cents per share and special dividend of 9 cents per share as recommended by the Directors for the

Fold and glue along dotted line financial year ended 31 December 2010 (2009: final ordinary dividend of 8 cents per share) 3. To re-elect Mr Lim Ho Kee as Director 4. To re-elect Prof Tsui Kai Chong as Director 5. To re-elect Mr Tan Yam Pin as Director 6. To re-elect Mr Heng Chiang Meng as Director 7. To re-elect Mrs Oon Kum Loon as Director 8. To approve Directors’ fees of $789,000 for the year ended 31 December 2010 (2009: $667,000) 9. To re-appoint Messrs Ernst & Young as Auditors, and to authorise the Directors to fix their remuneration Special Business 10. To approve the authority to issue shares and convertible securities pursuant to Section 161 of the Companies Act, Cap. 50 of Singapore 11. To approve the allotment and issue of shares pursuant to the Dividend Reinvestment Scheme 12. To approve the renewal of the Share Purchase Mandate 13. To approve the renewal of the Shareholders’ Mandate for Interested Person Transactions

* 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 as appropriate.

Dated this ______day of ______2011 Total Number of Shares in: No. of Shares (a) CDP Register (b) Register of Members Signature(s) or Common Seal of Member(s)

# IMPORTANT: Please read the notes overleaf before completing this Proxy 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 only have Shares registered in your name in the Register of Members, you should insert that number of Shares. However, 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/her stead. A proxy need not be a Member of the Company. Where a Member appoints more than one proxy, he/she shall specify the proportion of his/her 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 per cent. of the shareholding and the second named proxy shall be deemed as an alternate to the first named proxy.

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 before the time appointed for the Meeting.

5. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his/her 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 appointing a proxy or proxies if it is incomplete, improperly completed, illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of a member whose Shares are entered against his/her name in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if such member, being the appointor, is not shown to have Shares entered against his/her name in the Depository Register 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company. This annual report is printed on Meridien Brilliance, Eco-Frontier and Excel Satin. These papers are environmentally-friendly and are produced with a minimum content of 51% recycled paper. Keppel Land Limited (Incorporated in the Republic of Singapore)

230 Victoria Street #15-05 Bugis Junction Towers Singapore 188024 Tel: (65) 6338 8111 Fax: (65) 6337 7168 www.keppelland.com.sg

Co Reg No: 189000001G