With the opening of Taikoo Hui in Guangzhou in early 2009, we will have a high-grade investment property portfolio of over 19 million square feet. 8 37)2%0!#)&)#!..5!,2%0/24 3WIRE0ROPERTIESPORTFOLIOIN(ONG+ONGPRINCIPALLYCOMPRISESOFlCEANDRETAILPREMISESINPRIME LOCATIONS ASWELLASSERVICEDAPARTMENTS HOTELINTERESTSANDOTHERLUXURYRESIDENTIALACCOMMODATION 4HECOMPLETEDPORTFOLIOTOTALSMILLIONSQUAREFEETOFGROSSmOORAREA#URRENTPROPERTYPENDING ORUNDERDEVELOPMENTIN(ONG+ONGCOMPRISESAFURTHERMILLIONSQUAREFEET MAINLYOFOFlCE SPACE)N-AINLAND#HINA 3WIRE0ROPERTIESHASAINTERESTIN4AIKOO(UI AFOREIGNJOINTVENTURE COMPANYWHICHISCONSTRUCTINGAFOURMILLIONSQUAREFOOTMIXED USECOMMERCIALDEVELOPMENT IN'UANGZHOU TOBEMANAGEDBY3WIRE0ROPERTIES ASWELLASAINTERESTINTHE#)4)#3QUARE DEVELOPMENTIN3HANGHAI)NTHE5NITED3TATES 3WIRE0ROPERTIESOWNSAINTERESTINTHE-ANDARIN /RIENTAL(OTELIN-IAMI &LORIDA 3WIRE0ROPERTIESTRADINGPORTFOLIOCOMPRISESLANDANDAPARTMENTSUNDERDEVELOPMENTIN(ONG+ONG AND-IAMI &LORIDA4HECOMPANYHASSOLDSUBSTANTIALLYALLITSINVENTORYOFRESIDENTIALAPARTMENTS 0ROPERTY$IVISION .OTE (+-(+- 4URNOVER 'ROSSRENTALINCOMEDERIVEDFROM /FlCES 2ETAIL 2ESIDENTIAL .ON RECURRINGGROSSRENTALINCOME /FlCES n 2ETAIL n /THERINCOME 0ROPERTYINVESTMENT 0ROPERTYTRADING 3ALEOFINVESTMENTPROPERTIES 4OTALTURNOVER /PERATINGPROlTDERIVEDFROM 0ROPERTYINVESTMENT 0ROPERTYTRADING 3ALEOFINVESTMENTPROPERTIES 6ALUATIONGAINSONINVESTMENTPROPERTIES nCHANGEINFAIRVALUE nTRANSFERREDTOlNANCECOST nWRITE BACKOFOVER PROVISIONFORLANDPREMIUM n 4OTALOPERATINGPROlT 3HAREOFPOST TAXPROlTSFROM JOINTLYCONTROLLEDANDASSOCIATEDCOMPANIES .ORMALOPERATIONS .ON RECURRINGITEMS n !TTRIBUTABLEPROlT .OTES /THERINCOMEISMAINLYESTATEMANAGEMENTFEES 2EFERTO.OTEIN&INANCIAL2EVIEWSECTIONONPAGE 2EFERTO.OTEIN&INANCIAL2EVIEWSECTIONONPAGE 2EFERTO.OTEIN&INANCIAL2EVIEWSECTIONONPAGE 2EVIEWOF/PERATIONS 0ROPERTY$IVISION 4HEATTRIBUTABLEPROlTINTHETABLEONPAGEREmECTSTHEADOPTIONOF(ONG+ONG!CCOUNTING3TANDARDh(+!3v h)NVESTMENT PROPERTYv0ARTICULARSOFTHESTANDARDANDITSIMPACTONTHEDIVISIONSRESULTSARESETOUTINTHE&INANCIAL2EVIEW3ECTIONONPAGES TOAND.OTEA TOTHE!CCOUNTSONPAGE4HEUNDERLYINGPROlTOFTHEDIVISION WHICHEXCLUDESTHEIMPACTOFADOPTING (+!3AND)NTERPRETATIONh(+!3 )NTv ISSHOWNBELOW (+-(+- !TTRIBUTABLEPROlT 0ROlTONSALEOFINVESTMENTPROPERTIES 6ALUATIONGAINSFROMSUBSIDIARIES nCHANGEINFAIRVALUE nTRANSFERREDTOlNANCECOST nWRITE BACKOFOVER PROVISIONFORLANDPREMIUM n 3HAREOFVALUATIONGAINSFROM*##AND!SSOCIATES /THERS 4AXATION -INORITYINTERESTS 5NDERLYINGPROlT .ETRENTALINCOME 6ALUATIONOFINVESTMENTPROPERTIES (+- (+- #OMPLETED 5NDERDEVELOPMENT /PERATINGPROFITBEFORENON RECURRINGITEMS &LOORAREAOFPROPERTYPORTFOLIO #OMPLETED (+- SQFT ON COMPLETION 0ROPERTYINVESTMENT 3ALEOFINVESTMENT /FFICE 4ECHNO CENTRES (OTELS PROPERTIES 0ROPERTYTRADING 2ETAIL 2ESIDENTIAL SWIRE PACIFIC 2005 ANNUAL REPORT One Pacific Place 863,266 sf The Atrium 173,999 sf Two Pacific Place Festival Walk Tower 695,510 sf 232,215 sf enue Queensway Tat Chee Av Parkside 443,075 sf JW Marriott 525,904 sf e v ri The Mall D 711,182 sf Three Pacific Place stice 621,530 sf Ju Festival Walk (Mall) 981,303 sf et e tr Island Shangri-La S ng 605,728 sf u F Conrad g 540,115 sf in Kowloon Tong W KCR/MTR Interchange Supre m e C ourt Ro ad Pacific Place Festival Walk Not to scale. For identification purposes only. New Territories Kowloon MTR Routes KCR Routes MTR Interchange MTR/KCR Interchange Airport Express Routes MTR Station Quarry Bay Tai Koo Future Development Admiralty Hong Kong Island Lincoln House 333,350 sf Somerset House Cityplaza Four 923,356 sf Cityplaza Three 556,427 sf PCCW Tower 447,709 sf Dorset House Cambridge House (20% interest) 609,540 sf Devon House 268,793 sf 620,148 sf 803,448 sf Cornwall House 334,936 sf Warwick House Oxford House Taikoo Wan Road 552,537 sf 501,249 sf Cityplaza One (Phase 2) 446,107 sf Hotel Cityplaza Cityplaza (Mall) 199,640 sf 1,105,227 sf One Island East K Pan Hoi Street ing’ 1,522,128 sf s R oa d d oa R s d Cityplaza One an l t 628,785 sf s TaiKoo Place e Cityplaza W 11 2EVIEWOF/PERATIONS 0ROPERTY$IVISION 0ROPERTYPORTFOLIO GROSSmOORAREA@SQUAREFEET 4OTAL 2ETAIL /FlCE 4ECHNO CENTRES 2ESIDENTIAL (OTELS ,OCATION #OMPLETED 0ACIlC0LACE n 4AI+OO0LACE n n n #ITYPLAZA n n n &ESTIVAL7ALK nnn /THERS n n n(ONG+ONG n-AINLAND#HINA n n n n5NITED3TATES n n n n 4OTALCOMPLETED 5NDERANDPENDINGDEVELOPMENT n(ONG+ONG n n n-AINLAND#HINA n n 4OTAL /6%26)%7 /PERATINGPROlTFROMPROPERTYTRADINGREPRESENTSPRINCIPALLY 4HE(ONG+ONGPROPERTYMARKETHASBENElTEDSIGNIlCANTLY PROlTSBOOKEDONTHECOMPLETIONOFUNITSAT4HE#ARBONELL FROMTHEIMPROVEDECONOMYDURING$EMANDFOROFlCE INTHE5NITED3TATES TOGETHERWITHPROlTSFROMTHECLOSING SPACEHASINCREASED ANDTHEABSENCEOFSIGNIlCANTNEW OFREMAININGUNITSAT*ADE2ESIDENCESINTHElRSTHALFOFTHE SUPPLYHASCAUSEDOFlCERENTSTORISESHARPLY ANDVACANCY YEAR)NADDITION TWOOFlCEmOORSAT)SLAND0LACEIN.ORTH TODROP2ETAILRENTSHAVERISENSTEADILYWITHTOURISMFROM 0OINTWERESOLDIN!UGUST -AINLAND#HINACONTINUINGTOBENElTSALES PARTICULARLYIN CERTAINRETAILSECTORS THOUGHDOMESTICDEMANDHASALSO 4HEREMAININGAPARTMENTSANDSOMECARPARKSAT4HE CONTINUEDTOIMPROVE !LBANYWERESOLDDURINGTHEYEAR 2ECURRINGGROSSRENTALINCOMEFROMTHEINVESTMENTPORTFOLIO )NVESTMENT0ROPERTIES AMOUNTEDTO(+ MILLIONIN COMPAREDWITH /FlCES (+ MILLIONIN REmECTINGINCREASESTHROUGHOUT 4HEOFlCEMARKETWASCONSIDERABLYSTRONGERIN THEPORTFOLIO ASACONSEQUENCEOFINCREASEDDEMANDANDALIMITED AMOUNTOFNEWSUPPLY2ECURRINGGROSSRENTALINCOMEFROM 4HERESULTFORTHEYEARINCLUDESNON RECURRINGGROSSRENTAL THEOFlCEPORTFOLIOWASHIGHERINTHANIN INCOMEOF(+MILLION REPRESENTINGACHANGEINTHE 2EVERSIONARYRENTALSONNEWTENANCIESANDLEASERENEWALS ACCOUNTINGTREATMENTFORRENT FREEPERIODS)NPRIORYEARS WEREHIGHERFROMAROUNDTHEMIDDLEOFTHEYEAR/CCUPANCY RENT FREEPERIODSWEREACCOUNTEDFORONACASHBASISASTHEY LEVELSIMPROVEDSIGNIlCANTLYANDATTHEYEAR ENDAVERAGED OCCURREDININDIVIDUALLEASES7ITHEFFECTFROMST*ANUARY FORTHEOFlCEPORTFOLIOCOMPAREDTOATTHEEND THESERENT FREEPERIODSARERECOGNISEDEVENLYOVERTHE OF COMMITTEDTERMSOFINDIVIDUALLEASES4HEEFFECTOFTHIS TREATMENTISTOBRINGINTOINCOME IN (+MILLION WHICHWOULDOTHERWISEHAVEBEENRECOGNISEDINFUTUREYEARS 37)2%0!#)&)#!..5!,2%0/24 2ETAIL 2ESIDENTIAL)NVESTMENT0ORTFOLIO 4HE3WIRE0ROPERTIESRETAILPORTFOLIOCONTINUEDTOPERFORM 4HERESIDENTIALPORTFOLIOCOMPRISESMAINLY4HE!TRIUMAND WELLDURING'ROSSRENTALINCOMEFORTHEYEARWAS 0ARKSIDESERVICEDSUITESAT0ACIlC0LACE2EFURBISHMENTOFTHE HIGHERTHANTHATOF2ETAILSALESAT3WIRE0ROPERTIES SUITESAT0ARKSIDEWASCOMPLETEDDURING/CCUPANCY THREEPRINCIPALSHOPPINGMALLSWEREHIGHERANDTHESECENTRES OFTHEAVAILABLESERVICEDSUITESHASBEENLOWERINTHESECOND REMAINFULLYLET#ITYPLAZA 4HE-ALLAT0ACIlC0LACEAND HALFOFTHEYEAR LARGELYDUETOINCREASEDCOMPETITIONINTHE &ESTIVAL7ALKTOGETHERWELCOMEMORETHANTENMILLIONVISITORS MARKET4HEREMAININGRESIDENTIALPROPERTIESON(ONG+ONG EACHMONTH )SLANDWEREFULLYLET #ITYPLAZAISTHEPRIMARYDESTINATIONFORSHOPPERSIN)SLAND )NVESTMENT0ROPERTIESUNDER$EVELOPMENT %AST5NY 7ING/N -ARKS3PENCERAND5!#INEMASARE 7ORKWILLCOMMENCESHORTLYONTHEMAINCONTRACTFOR AMONGTHEMAJORANCHORTENANTSOTHERTENANTSCOMPRISEOVER THECONSTRUCTIONOF/NE)SLAND%AST ANOFlCEBUILDINGOF RETAILANDCATERINGOUTLETSANDTHE#ITYPLAZA)CE0ALACE APPROXIMATELY SQUAREFEETAT7ESTLANDS2OAD TOGETHERTOTALLINGJUSTOVER SQUAREFEET DUEFORCOMPLETIONIN 4HE-ALLAT0ACIlC0LACEISTHEPRE EMINENTSHOPPINGMALL 6ALUATIONOF)NVESTMENT0ROPERTIES IN(ONG+ONG3EIBU 'REAT&OOD(ALLAND,ANE#RAWFORD 4HEPORTFOLIOOFINVESTMENTPROPERTIESWASVALUEDATST ARETHEANCHORTENANTS TOGETHERWITHOTHERRETAILAND $ECEMBERBY$EBENHAM4IE,EUNG!SARESULTOF CATERINGOUTLETSAMOUNTINGTOAPPROXIMATELY THISVALUATION 3WIRE0ROPERTIESOPERATINGPROlTINCREASED SQUAREFEET,ANE#RAWFORDWASCLOSEDFORREFURBISHMENT BY(+ MILLION4HEINCREASEINLARGELYREmECTS FORAPPROXIMATELYTHREEMONTHSINTHESECONDHALFOF THERECOVERYINOFlCERENTALLEVELSANDBENCHMARKSSETBY 4HECINEPLEXAT0ACIlC0LACECLOSEDFORRECONlGURATIONAND RECENTTRANSACTIONSINTHEMARKET0ARTICULARSOFTHEPROPERTIES REFURBISHMENTATTHEENDOF*ANUARYANDWILLRE OPEN IN(ONG+ONGANDTHE53! BOTHFORINVESTMENTAND INTHEFOURTHQUARTEROFTHISYEAR DEVELOPMENTFORSALE ARESETOUTONPAGESTO &ESTIVAL7ALK AMAJORSHOPPINGCENTREIN+OWLOON WAS 4AIKOO3HING!RBITRATION JOINTLYOWNEDBY3WIRE0ROPERTIESAND#)4)#0ACIlCUNTIL 4HECLAIMBYTHE(ONG+ONG3!2'OVERNMENT,ANDS RD-ARCHANDWHOLLYOWNEDBY3WIRE0ROPERTIES $EPARTMENTFORLANDPREMIUMINRELATIONTOTHE#ITYPLAZA FROMTHATDATE!NCHORTENANTSINCLUDE4ASTE -ARKS &OUR #ITYPLAZA4HREEAND#ITYPLAZA/NEOFlCETOWERSWAS 3PENCER 0AGE/NE"OOKSANDTHE!-##INEMA PLUSOVER UPHELDINANARBITRATIONAWARDANNOUNCEDIN*ANUARY OTHERRETAILANDCATERINGOUTLETSANDTHE'LACIERICERINK )N*ULYTHE#OURTOF&INAL!PPEALREFUSEDTOGRANT3WIRE TOGETHERCOMPRISINGOVER SQUAREFEET 0ROPERTIESLEAVETOAPPEALONAPOINTOFLAW&OLLOWINGAFRESH HEARINGHELDIN&EBRUARY THEARBITRATORDETERMINEDTHAT /NRD-ARCH 3WIRE0ROPERTIESCOMPLETEDTHE THEVALUATIONDATESFORTHEPURPOSEOFQUANTIFYINGTHEAMOUNT ACQUISITIONOF#)4)#0ACIlCSINTERESTIN&ESTIVAL7ALKFOR OFLANDPREMIUMONTHEOFlCETOWERSSHOULDBETHEDATES ACONSIDERATIONOF(+ MILLION ONWHICHOCCUPATIONPERMITSWEREISSUEDFOREACHOFTHE BUILDINGS ANDTHATINTERESTSHOULDBECALCULATEDATTWO THIRDS 4HE#ITYGATERETAILCENTREAT4UNG#HUNG INWHICH3WIRE OF()")$FROMTHOSEVALUATIONDATES 0ROPERTIESHASAINTEREST ISBEINGREPOSITIONEDASAN OUTLETMALLFORINTERNATIONALBRANDS ANDANUMBEROFNEW TENANCIESHAVEBEENSECURED 2EVIEWOF/PERATIONS 0ROPERTY$IVISION 3WIRE0ROPERTIESANDTHE,ANDS$EPARTMENTENTERED 0ROPERTY4RADING0ORTFOLIO INTODISCUSSIONSTOSETTLELANDPREMIUMlGURESFORTHE