NEW MARKETS NEW OPPORTUNITIES ANNUAL REPORT 2018/2019 REVENUE S$3,948.1 MILLION PATMI S$2,161.1 MILLION TOTAL AUM S$55.7 BILLION TOTAL GROSS FLOOR AREA Mapletree Business City II (MBC II), Singapore (square metres) Mapletree’s Annual Report 2018/2019 theme details the Group’s growth into new markets which identify new opportunities. ~22 MILLION The cover design comes from the inspiration to showcase Mapletree’s flagship business park in Singapore, MBC II, together with 262 logistics assets, EXPANSIVE PORTFOLIO ACROSS which formed the Group’s first private fund in the United States and Europe – Mapletree US & EU Logistics Private Trust (MUSEL), syndicated during the financial year. 12 MARKETS NEW MARKETS TOTAL AMOUNT commiTTED TO commUNITIES NEW OPPORTUNITIES (since FY10/11) Mapletree concluded its second Five-Year Plan in Financial Year 18/19 (FY18/19) and delivered an outstanding set of results. As at 31 March 2019, S$24.3 MILLION Mapletree attained revenue of S$3,948.1 million and achieved a record profit after tax and minority interests (PATMI) of S$2,161.1 million. The Group grew its assets under management (AUM) to S$55.7 billion in FY18/19 through the broadening of its global footprint into new markets five years ago. CONTENTS Performance Highlights 2 Solid Foundation Solid Growth 4 Corporate Overview 6 Message from the Chairman 8 Interview with the Group CEO 12 Board of Directors 16 Group Senior Management 22 Diverse Reach Diverse Value 28 Highlights of the Year 30 Financial Review 36 Corporate Liquidity and Financial Resources 51 Awards and Accolades 55 Greater Vision Greater Future 56 Operations Review 58 Property Portfolio 80 Our Offices 91 Investment Activities and Fund Management 92 Impacting Communities Impacting Lives 96 Sustainability Report 98 Sustainability – Corporate Governance 121 Sustainability – Risk Management 126 Financial Statements 129 CONTENTS 1 PERFORMANCE HIGHLIGHTS Mapletree successfully TOTAL ASSETS UNDER MANAGEMent (AUM) achieved the targets set in (FY18/19) the second Five-Year Plan in the financial year ended 31 March 2019 (FY18/19). The record profitability was underpinned by growth in asset performance, fee S$55.7 businesses, new acquisitions and completed development BILLION projects. The Group continued to expand beyond Asia into new markets in AUM Australia, Europe and the (S$ million) 17,977 United States five years ago. 37,747 56,000 In five years, Mapletree’s assets under management 15,238 48,000 31,051 (AUM) more than doubled to S$55.7 billion, with 67.7% 11,423 28,111 being third-party AUM. The 40,000 Group’s earnings base also 11,774 expanded to include a higher 22,972 record of S$2,212 million in 32,000 7,853 EBIT + SOA1, and fee income2 20,562 6,381 of S$450.7 million. Mapletree 18,224 24,000 5,020 also delivered five-year 16,744 8,450 average return on invested 11,401 equity (ROIE)3 of 11.0% 7,531 7,891 4 16,000 6,863 and NAV CAGR of 13.1%. 6,076 Overall, revenue increased to S$3,948.1 million with 8,000 profit after tax and minority interest (PATMI)5 hitting a strong record of S$2,161.1 0 million. 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 Financial Year Managed assets Owned assets 2 MAPLETREE INVESTMENTS PTE LTD ANNUAL REPORT 2018/2019 Average Five-Year ROIE3 (From FY14/15 - FY18/19) PATMI5 11.0% (FY18/19) Average 10-Year ROIE3 (From FY09/10 - FY18/19) S$2,161.1 12.5% MILLION Five-Year NAV CAGR4 (From FY14/15 - FY18/19) FEE INCOME2 (S$ million) 451 13.1% 450 375 10-Year NAV CAGR6 302 (From FY09/10 - FY18/19) 300 267 277 241 203 225 188 134 150 124 12.2% 81 75 0 1 Earnings before interest and tax (EBIT) 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 plus share of operating profit or loss of associated companies and joint ventures Financial Year (SOA), excluding revaluation gains or losses, divestment gains or losses, foreign exchange and derivatives gains or losses. 1 EBIT + SOA 2 Includes REIT management fees. 3 ROIE is computed based on Operational (S$ million) 2,212 PATMI (less profit attributable to perpetual securities) over the Group’s equity from shareholder adjusted for unrealised 2,100 revaluation gains or losses and such 1,734 other non-cash flow and non-operating 1,750 1,575 items including mark-to-market fair value adjustments and negative goodwill. 1,327 4 NAV CAGR is adjusted for dividends 1,400 1,141 distributed to shareholder and calculated 1,042 excluding non-controlling interests and 1,050 877 perpetual securities and with NAV as at 796 31 March 2014 as starting base. 5 PATMI denotes net profit after tax and 700 589 527 non-controlling interests attributable to Perpetual Securities Holders and Equity 350 Holder of the Company. 6 NAV CAGR is adjusted for dividends distributed to shareholder and calculated 0 excluding non-controlling interests and 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18 18/19 perpetual securities and with NAV as at Financial Year 31 March 2009 as starting base. PERFORMANCE HIGHLIGHTS 3 SOLID FOUNDATION SOLID GROWTH Mapletree’s business model creates value through our core capabilities in real estate development, investment, capital and property management. In FY18/19, we deepened our footprint in Australia, China, Europe, India and the United States, specifically in the logistics, student accomodation and office sectors. DEVELOPER INVESTOR CReate vaLUE CapitaLISE ON OPPORTUNITIES We transform greenfield lands, We pursue, seize and underwrite underperforming assets and new business opportunities precincts into high-value real estate across the entire real estate value with our strong development chain. know-how. REAL ESTATE CAPABILITIES CAPITAL MANAGER PROPERTY MANAGER GROW THIRD-PARty AUM StewaRD OF ASSETS We employ a disciplined capital We provide a suite of quality management framework to deliver property management services consistent and high returns to to our tenants and ensure that our investors, demonstrated by their operational needs are met. the successful execution and performance of our four REITs and six private equity funds. ABOUT THE ART PIECE sun rise || sun set Displayed at Mapletree Business City in Singapore, sun rise || sun set, aims to provoke contemplation and reflection amidst the progression of time. The shadows cast by the undulating roof onto the side columns and by the columns to the steps, change and move slowly to portray time. The transitional and alternating shadows cast are tranquil yet mysterious. The structure is intended to provide an interactive space for one to walk through and explore their shadows, both a reflection of self and light. The work is a design collaboration between Mapletree and the Department of SOLID FOUNDATION SOLID GROWTH 5 Architecture, School of Design and Environment, National University of Singapore (NUS), using 488 recycled planks collected from the re-decking of the VivoCity Sky Park in 2017. This is one of the eco-sustainability initiatives of Mapletree. CORPORATE OVERVIEW Mapletree Investments Mapletree has been investing actively billion, or about 67.7% of the Group’s Pte Ltd (Mapletree) is in income-yielding assets globally. AUM are held under four Singapore- From incorporating our key strengths listed real estate investment trusts a leading real estate as a developer, investor, capital and (REITs) and six private equity real development, investment, property manager, we have been estate funds. Mapletree strives capital and property growing our portfolio of income- to maintain an optimal capital management company producing assets globally. In line with structure that provides financial Mapletree’s strategy to grow new flexibility to pursue new investment headquartered in income streams beyond Asia and opportunities. Singapore. We invest diversify its business, we ventured in real estate sectors into the developed, transparent and Mapletree’s properties span across 12 highly liquid markets of Australia, markets, namely Singapore, Australia, globally in geographical Europe, the United Kingdom (UK) and China, Europe, Hong Kong SAR, India, markets with good the United States (US). Japan, Malaysia, South Korea, the UK, growth potential, to the US and Vietnam. Mapletree owns provide consistent and During FY18/19, the Group continued and manages a diversified portfolio to broaden its presence by successfully of office, mixed-use, retail, logistics, high returns to our making acquisitions of office, student industrial, residential and lodging investors. accommodation and logistics assets in assets. Australia, China, Europe, India, Japan, the UK and the US. To support its global operations including Oakwood, Mapletree As at 31 March 2019, the Group has more than 3,400 employees had S$55.7 billion of assets under operating from our extensive management (AUM). Over S$37.7 network of offices. AUM BY GEOGRAPHY1 CHINA AND INDIA S$6,661.9m EUROPE S$4,836.1m NORTH ASIA NORTH AMERICA S$4,229.5m S$9,750.2m HONG KONG SAR S$9,124.8m SOUTH EAST ASIA S$2,180.7m SINGAPORE S$17,403.2m AUSTRALIA S$1,538.2m 6 MAPLETREE INVESTMENTS PTE LTD ANNUAL REPORT 2018/2019 OUR BUSINESS SEGMENTS Singapore Investments Logistics Development China and India Developer/investor/manager of Developer/investor/manager of Developer/investor/manager of primarily commercial properties (and logistics properties in China, Malaysia properties in China and India select industrial and business park and Vietnam Capital Management Platform properties in Singapore) Private real estate funds: • Mapletree India China Fund • Mapletree China Opportunity Fund II South East Asia Australia-New