CAPITALAND MALAYSIA MALL TRUST Annual Report 2018

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CAPITALAND MALAYSIA MALL TRUST Annual Report 2018 CAPITALAND MALAYSIA MALL TRUST Annual Report 2018 WE ARE FUELLED BY PASSION WE ARE FUELLED VISION MISSION BY PASSION Passion and resilience. These are To be Malaysia’s leading To deliver long-term and sustainable traits one can see in a child – lively, shopping mall real estate distribution of income and potential expressive, ready for challenges, investment trust through capital growth to Unitholders value creation and and enthusiastic for new adventures. continuous innovation. FOR INVESTORS These traits also apply to how Deliver sustainable total returns CapitaLand Malaysia Mall Trust (CMMT) FOR TENANTS approaches long-term growth. Create profitable opportunities Sticking to our values, focusing on our FOR SHOPPERS Create delightful shopping strategies and working with passion, and lifestyle experiences we continue to harness the combined expertise and dedication of our team to FOR EMPLOYEES Provide opportunities to realise make good on our value proposition personal potential and achieve and seek new growth opportunities. professional growth Through proactive asset management FOR THE COMMUNITY and asset enhancement initiatives, Promote social responsibility CMMT is driven to create long-term and environmental sustainability unitholder value. An artist’s impression of Jumpa @ Sungei Wang CORPORATE PROFILE CONTENTS Listed on the Main Market of Bursa Malaysia OVERVIEW Securities Berhad (Bursa Malaysia) on 02 2018 Highlights 03 Financial Highlights 16 July 2010, CMMT is a shopping mall- 04 Property Portfolio focused real estate investment trust (REIT) 05 2018 Initiatives in Malaysia with an income-producing, 12 Board of Directors geographically diversified portfolio of five 13 Letter to Unitholders shopping malls and a complementary 16 Trust Structure office block. Organisation Structure 17 Value Creation 18 Financial and Trading Highlights As at 31 December 2018, CMMT had 20 Salient Features of CMMT a market capitalisation of approximately 21 Year in Brief RM2.1 billion and its portfolio was independently valued at RM4.0 billion. CORPORATE GOVERNANCE & TRANSPARENCY CMMT invests, on a long-term basis, 24 Board of Directors in income-producing real estate which is 28 Trust Management primarily used for retail purposes and these 30 Corporate Governance 55 Audit Committee Report quality assets are strategically located in key 59 Statement on Risk Management urban centres across Malaysia; Gurney Plaza and Internal Control in Penang, three in Klang Valley – a majority 62 Enterprise Risk Management interest in Sungei Wang1 in Kuala Lumpur, 65 Investor & Media Relations 3 Damansara and Tropicana City Office 66 Unit Price Performance Tower in Petaling Jaya, The Mines in Seri Kembangan and East Coast Mall in Kuantan, SUSTAINABILITY 67 Sustainability Management Pahang. The portfolio has a total net lettable area of over 2.9 million square feet (sq ft). BUSINESS REVIEW As at 31 December 2018, the total asset size 74 Operations Review of CMMT is approximately RM4.1 billion. 78 Financial Review 81 Capital Management CMMT is managed by CapitaLand Malaysia 83 Independent Retail Market Overview Mall REIT Management Sdn. Bhd. (the 91 Marketing and Promotions 94 Property Summary Manager) – a joint venture between CapitaLand Limited, one of Asia’s largest PORTFOLIO DETAILS real estate companies headquartered and 95 Gurney Plaza listed in Singapore, and Malaysian Industrial 98 Sungei Wang Development Finance Berhad (MIDF). 101 3 Damansara & Tropicana City Office Tower MTrustee Berhad (the Trustee) is the trustee 104 The Mines for CMMT. 106 East Coast Mall FINANCIALS & ADDITIONAL INFORMATION 108 Financial Statements 162 Statistics of Unitholders 166 Notice of Annual General Meeting Proxy Form Corporate Information 1 CMMT’s interest in Sungei Wang comprises (i) 205 strata parcels within the mall which represents approximately 61.9% of the aggregate retail floor area of Mall Trust CapitaLand Malaysia Annual Report 2018 Sungei Wang, and (ii) 100.0% of the car park bays in Sungei Wang. 01 OVERVIEW OVERVIEW 2018 HIGHLIGHTS GROSS REVENUE NET PROPERTY INCOME PROPERTY VALUATION RM350.1 RM215.0 RM4.0 million million billion RM368.9 million in 2017 RM237.1 million in 2017 RM4.0 billion in 2017 NET LETTABLE AREA1 NO. OF COMMITTED PORTFOLIO LEASES OCCUPANCY RATE 2.9 million sq ft 1,292 93.2% 3.1 million sq ft in 2017 leases 95.4% in 2017 1,333 leases in 2017 ANNUAL SHOPPER DISTRIBUTION PER DISTRIBUTION TRAFFIC UNIT YIELD 57.5 7.90 sen 7.82% million 8.22 sen in 2017 4.49% in 2017 59.0 million in 2017 MARKET CAPITALISATION RM2.1 billion CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 RM3.7 billion in 2017 02 1 Area under asset enhancement initatives is removed from computation. OVERVIEW OVERVIEW FINANCIAL HIGHLIGHTS TOTAL ASSETS GROSS REVENUE (RM million) (RM million) 372.6 368.9 350.1 4,148.9 4,177.9 4,143.0 344.8 4,091.8 315.4 3,404.7 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 NET PROPERTY INCOME DISTRIBUTABLE INCOME (RM million) (RM million) 242.5 237.1 226.4 215.0 208.9 162.8 171.1 167.4 158.4 161.3 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 DISTRIBUTION PER UNIT DISTRIBUTION YIELD1 (sen) (%) 7.82 8.91 8.60 8.43 8.22 7.90 6.23 6.23 5.51 4.49 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 1 Based on the closing unit price of RM1.43 on 31 December 2014, RM1.38 on 31 December 2015, RM1.53 on 30 December 2016, RM1.83 on 29 December 2017 and RM1.01 on 31 December 2018. 03 OVERVIEW OVERVIEW PROPERTY PORTFOLIO 1,292 2.9million sq ft RM 4.0billion Leases Net Lettable Area Valuation 1 1 Gurney Plaza 5 3 2 4 2 3 Damansara & Tropicana City Office Tower CMMT invests, on a long-term An artist’s impression of Sungei Wang’s new facade basis, in income-producing real estate which is primarily used for retail purposes and located primarily in Malaysia. 3 Sungei Wang 4 The Mines 5 East Coast Mall CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 04 OVERVIEW OVERVIEW 2018 INITIATIVES GURNEY PLAZA Penang’s premier lifestyle shopping mall destination Joint Silver winner in the above 10 years retail category for the EdgeProp Malaysia’s Best Managed Property Awards 2018 2018 KEY HIGHLIGHTS To optimise the layout on Level 4 and further diversify Anchor tenant Parkson commenced renovations to the mall’s offerings, we reconfigured the space to upgrade to Parkson Elite – the first flagship store house fashion stores and cafe kiosks. Now known as outside the Klang Valley Lifestyle Avenue targeting the millennials and young- Opening of several new brands like Hugo Boss, Furla, at-heart shoppers, several homegrown brands were La Mer, Aesop, Innisfree, JD Sports, Puma, HLA, successfully incubated Owndays, Ippudo Ramen + Bar, Hoshino Coffee, San Completed exterior façade repainting as part of the Francisco Coffee and Quickie by Chin Chin ongoing repositioning efforts to further elevate the mall's positioning CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 05 OVERVIEW OVERVIEW 2018 INITIATIVES SUNGEI WANG An artist’s impression of the interior of Jumpa @ Sungei Wang Strategically located within the established Bukit Bintang shopping district Positioned as one-stop destination “for all kinds of everything” 2018 KEY HIGHLIGHTS A RM54.5 million asset enhancement initiative A showsuite was set up to support Jumpa’s leasing commenced to reconfigure the annex space into a efforts as well as a retailers’ gathering vibrant and energetic lifestyle zone. Known as Jumpa, Anchor tenant Giant completed its renovation and shoppers can look forward to an exciting line-up of now offers a new urban store concept at Sungei more than 80 specialty shops offering fashion, food Wang and beverage, family entertainment and athleisure Opening of several new brands like Boost Juice, when it opens in 2H 2019 Watch Me, Dubuyo, TeaLive and Cin Cai Lar Let’s JUMPA Retailers’ Gathering 2018 The leasing showsuite Jumpa @ Sungei Wang CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 06 OVERVIEW OVERVIEW 3 DAMANSARA & TROPICANA CITY OFFICE TOWER The preferred dining and gourmet destination, serving as a hub for the local community to meet, dine, drink and shop under one roof Strategically located at the intersection of two major highways, making it easily accessible from Kuala Lumpur and various parts of Petaling Jaya 2018 KEY HIGHLIGHTS Tropicana City Mall was renamed as 3 Damansara RM6.2 million was spent to refurbish the restrooms to improve shoppers’ experience Opening of several new food and beverages outlets like Chicken Plus, Divine Meats, Taipei Taipei, Macao Imperial Tea, Boost Juice and The Wrapz. Other new brands include Huawei, Sport Planet, Mr. D.I.Y, Ace Hardware, Dreamland, MyEG and XES Signature CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 07 OVERVIEW OVERVIEW 2018 INITIATIVES THE MINES A lifestyle suburban shopping mall in southern Klang Valley which offers a variety of fashion, I.T., food and beverages, homewares, entertainment and groceries Strategically located in Seri Kembangan’s Mines Resort City that is well known for its Venetian- like internal water canal that links two former tin mine lakes 2018 KEY HIGHLIGHTS Created a home furnishing zone at South Zone on Opening of several new brands like SSF Concept Level 4 Store, Celllora, Mi Store, Acer Concept Store, KK Embarked on two asset enhancement initiatives on Super Mart, Family Mart, Mick Hair Care, YOGU Level 2 to expand food and beverages and lifestyle Frozen Yogurt and Olympic Kids Club offerings CapitaLand Malaysia Mall Trust CapitaLand Malaysia Annual Report 2018 08 OVERVIEW OVERVIEW EAST COAST MALL Positioned as a modern family lifestyle mall and widely regarded as the market leader in East Coast of Peninsular Malaysia Located in the heart of Kuantan’s city centre in Pahang and is within walking distance to local attractions and amenities 2018 KEY HIGHLIGHTS Completed asset enhancements works on Level 1 Opening of several new brands like Yoshinoya to create an international fashion cluster.
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