Central Pattana Plc. Property Development and Investment
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Central Pattana Plc. Property Development and Investment CentralPlaza Nakhon Si Thammarat The 30th Mall opened on 28 July 2016 Corporate Presentation: 2Q16 Performance Review Contents ► Our Company ► Growth ► Financing ► Looking ahead ► Appendices 2 Our company CPN at a Glance To be the most admired and dynamic regional retail property VISION developer with world-class rewarding experience Mixed-use Project Development Malls Other related business Property funds Residential Commercial Hotel CPNRF CPNCG 7 Office Buildings 2 Hotels 1 1 Residence • Lardprao CPNRF: Central City Residence • Pinklao Tower A RM2, RM3, PKO, CMA, 23 @ Bangna • Pinklao Tower B Pinklao Tower A&B 6 • Bangna • CentralWorld Tower • Chaengwattana CPNCG: • Rama9 The Offices @ CentralWorld st 30 1.6 mn sqm 93% 1 Rank 17% Shopping Malls NLA Occ. Rate Retail Developer 1H16 Rev. Growth 3 Our company Strategic Shareholders CPN is one of the flagship businesses of the Central Group (Chirathivat Family). As a strong and supportive shareholder, the Chirathivat family brings to CPN a wealth of retail-related expertise through the family‟s long record and successful leadership in Thailand‟s dynamic and competitive landscape of shopping mall developments and department store / specialty store operations. Chirathivat Family 26% Local funds 22% Free float Foreign 53% 47% funds 68% Individuals Central 10% Group 27% Source: TSD as of 30 June 2016. 4 Our company Strategic Shareholder CPN‟s strong synergy with the Central Group helps CPN to attract dynamic tenants, increase people traffic and command higher rents. Central Group Central Pattana Public Company Limited (53%)* Central Department Store Group (100%)* Central Hotel & Resort Group (65%)* Central Food Retail Group (100%)* Central Restaurant Group (69%)* Central Hardlines Group (100%)* Central Marketing Group (100%)* Central Online (50%)* * Percentage held by Central Group 5 Listed Company: CPN, CENTEL (CHi & CRG), ROBINS (Central Department Store Group holds 62%) and COL Our company Property Development and Management Property Developer & Property Manager Department Store Shopping Mall & Category killers Other Other Other Other Tenants Tenants Tenants Tenants CRG Other Other Other Other Tenants Tenants Tenants Tenants CMG CRG & CMG Other tenants Joint developers • ~12% of total leasable areas • ~88% of total leasable areas and also in • Sharing cost of land and common and also in term of total term of total revenue area revenue • Owning its investment cost and assets • Pricing criteria as same as others 6 Our company CPN Positioning 21% market share in Bangkok Key success factors Central Group Synergy Prime Financial Location Flexibility New projects by other players No. of new Investment Owners GFA (sqm mn) Year Strategy projects (THBbn) City within the city malls in Bangkok World iconic tourist The Mall 4 1.75 50 ′16-′20 destination for new malls in tourist destination Expand 2-3 community malls per year JV with IKANO for SF 1 0.40 10 ′19-′20 super regional malls Expand mall adjoining Future Park Rangsit Future Park 1 0.16 4 ′15 Use model of mall in CBD area 104 rais ′17-′18 Mixed use projects in tourist destination and fine dining TCC Land 3 7 (41 acres) concept Siam Piwat, 40 rais Plan to be Bangkok‟s iconic landmark, Mixed-use project 1 35 ′17 CP, Magnolia (16 acres) with mall, residential, and entertainment Source: Figures and strategy were collected from public media and had not been verified. This is made for information purposes only. 7 Our company New Shopping Malls CentralPlaza Rayong : opened 27 May 2015 CentralPlaza WestGate : opened 28 Aug 2015 CentralFestival EastVille : opened 27 Nov 2015 CentralFestival Phuket : acquired 1 Jun 2015 8 Our company 30th Open : 28 JULY 2016 Location: South of Thailand Land: 51 rai NLA (CPN Only) 26,000 sqm Parking 1,400 cars Leasing Progress: ~80% at the opening Our company CentralPlaza WestGate “Super Regional Mall” • Ultimate lifestyle centre • Unique design features • Creative art installations under the concept “Have A Big Life” • Family-friendly mall • New dining destination 10 Our company CentralPlaza WestGate – New Format & Concept Art Installations The Welcome Gate Giant Giraffe Wise Garden 11 Our company CentralPlaza WestGate – New Format & Concept Feature Attractions & Ambience 12 Our company CentralFestival EastVille “The Bangkok Escape” • The first full-scale lifestyle outdoor shopping centre, combining nature and a modern atmosphere • Sky Run • Pet Park - pet lovers zone • ThinkSpace - co-working space • Lifestyle Dining Destination • Leisure & Entertainment • Kids Club & PlaySpaze 13 Our company CentralFestival EastVille Outdoor 14 Our company CentralFestival EastVille Indoor 15 Our company Asset Enhancement – CentralPlaza Pinklao The Best is Back 16 Our company Asset Enhancement – BANGNA Facilities for Kids & Family 17 Growth CPN‟s Growth Aspiration 5 year target : top line growth of 15% CAGR for 2016-2020 Mixed-use Project Development Malls Other related business Property funds 15 New projects: Condominium 12 Domestic projects (BKK:Provinces = 50:50) 2018: ESCENT Khonkaen 2016–2017: 3 Overseas projects ESCENT Chiangmai Possibility of (i-City in Malaysia and 2 malls) ESCENT Rayong Property Fund Conversion to REIT Target: 3 projects/year Renovation projects: 2016: Bangna, Pattaya, Phuket, Chaengwattana 2017: CTW, RM3, RM2, CMA, PKT 2018-2020: approx. 3-4 projects/year 18 Growth Future Leasable Area & Occupancy Rate Retail NLA Occupancy Rate (mn sqm) (%) 2.0 94 94 94 94 100 90 1.9 80 1.8 70 36 60 1.7 50 40 1.6 33 30 30 1.5 29 20 10 1.4 0 FY2015 '16 '17F '18F Existing New Unannounced RS: Occupancy rate No. of Malls 2015 2016 2017F 2018F BKK 13 13 14 16 Provinces 16 17 19 19 Overseas - - - 1 NLA (mn sqm) 1.58 1.61 1.77 1.89 Source: Company estimate as at 30 June 2016. Retail space: Includes leasable area of CentralPlaza Rama 2, CentralPlaza Rama 3, CentralPlaza Pinklao, and CentralPlaza Chiangmai Airport, which were 19 partially transferred to CPNRF, but still under CPN’s management. Growth Rental Contracts Type & Upside Upside from expirations of long-term lease contracts converted into short term contracts at market rental rate should help increase revenues. Reliable contract structure Potential higher revenue Types of rental contract (1) % of expired area to total long-term lease area (2) Fixed Rent Consignment ≥'21 26 31 48% 35% (48%) (34%) '20 17 '19 4 12 '18 3 '17 3 Long-term Lease FY2016 3 PKO 17% (18%) - 20 40 60 % Retail shops Department Stores in Acquired Projects Source: Company estimate as of 30 June 2016. (1) Percentage based on occupied area. 20 (%) 2Q15 figure (2) Total long-term lease area is 163,157 sq.m. with less than 4% rental income contribution. Growth Domestic expansion continues CentralPlaza Nakhon Ratchasima CentralPlaza Mahachai Investment cost (1) : THB5.00bn Investment cost (1) : TBC NLA (2) : 56,000 sqm NLA (2) : TBC Joint developer (3) : Central Department Store Joint developer (3) : Robinson Department Store Land Size : 26 acres (65 rais) (Freehold) Land Size : 40 acres (100 rais) (Freehold) Parking : 3,500 cars Parking : TBC 2017 3Q17 4Q17 2018 2020 Central Phuket Investment cost (1) : THB6.65bn (2) 8 additional projects ′18-′20 NLA : 63,000 sqm Joint developer (3) : - Land Size : 22 acres (57 rais) (Leasehold) (BKK:Provinces = 50:50) Parking : 3,000 cars Note 1: Includes land and construction cost of shopping center and parking building. Excludes those of Central Department Store or Robinson Department Store (CRC) Note 2: Excludes CRC‟s area. 21 Note 3: Area will be developed and owned by the joint developer. However the store will serve as a magnet to draw traffic into CPN‟s plaza area. Growth International project in Malaysia Central i-City ( 1 ) Investment Cost THB8.3bn I-R&D Sdn Bhd (“IRD”), an I-Berhad wholly-owned subsidiary Joint venture CPN holds 60% stake and IRD holds 40% stake CPN will lead in the development and management of the shopping mall Program: Shopping center 89,700 sqm (NLA includes department store) Land size 11 acres (27 rais) Location i-City, Shah Alam, Selangor Darul Ehsan, Malaysia Opening (Tentative) 4Q18 Project progress: • 100% completion of Anchor Leasing (Department Store, Supermarket, and Cinema) (1) Includes land and construction cost of shopping center and parking building. 22 Growth Potential expansion in neighboring countries Investment strategy Malaysia Joint venture with local partners with focus on retail Realistic land prices and freehold ownership properties Moderate competition and fragmented market To be a property manager High spending power with customer profile similar to Completed JV Agreement Thailand Potential Locations Vietnam Large population Thailand Low competition with few major players Strong growth in disposable income/low spending power Vietnam Indonesia Malaysia Large population Rapidly growing middle class population with increasing spending power Sophisticated market but strong competition from existing players Indonesia High cost of fund and unrealistic land price with limited infrastructure 23 Asset enhancement projects Growth Modernize malls to enhance asset value and draw traffic 4 Projects in 2016 • CentralPlaza Bangna • CentralPlaza Pattaya • CentralFestival Phuket • CentralPlaza Chaengwattana 2017 2016 5 Projects in 2017 • CentralWorld • CentralPlaza Rama3 • CentralPlaza Rama2 • CentralPlaza Chiangmai Airport • CentralFestival Phuket 24 Growth Residential projects in the provinces Value-added condominium projects in key domestic market • maximize value creation from outstanding mall locations ; • 3 key projects in high-growth provinces: Chiangmai, Rayong, and Khonkaen ESCENT Chiangmai 400 Units 26-storey condo 100% pre-sales ESCENT Khonkaen ESCENT Rayong 408 Units 419 Units 24-storey condo 25-storey condo 100% pre-sales 95% pre-sales 25 Financing Additional Capex to drive future growth Capex will continue to focus on core business Capex 2015-2018F (THB bn) FY2015 „16F „17F „18F Under construction 12.00 10.18 8.01 4.20 Enhancement 2.16 3.10 1.42 1.30 Potential 2.79 3.09 3.98 8.23 Total Malls 16.96 16.37 13.41 13.73 Residential 0.01 0.44 1.22 1.55 Total Capex 16.97 16.81 14.63 15.28 Source: Company estimate as of 31 August 2016.