Proposed Acquisition of 9 Tai Seng Drive & 5 Science Park Drive (~S$700M)

[00:00:00] Acquisition Presentation: 9 Tai Seng Drive & 5 Science Park Drive

Andrea Ong (Director, IR), Khoo Li Sun (CFO)

Management introduces the panel and presents CLAR's proposed acquisition of 9 Tai Seng Drive, a co-location data centre, and 5 Science Park Drive, a business park leased to Shopee, for a combined consideration of about $725 million. The presentation covers purchase prices, NPI yields, portfolio impact on assets under management and Singapore exposure, organic rental upside at both properties, and the resulting DPU accretion from the transaction.

[00:00:00] Andrea Ong (Director, IR):

“welcome to Capital n Asanders Reeds briefing for the proposed acquisitions of 9 Tai Seng Drive and 5 Science Park Drive”

[00:13:34] Q&A - Question 1: DPU Accretion & 9 Tai Seng Drive Power Capacity (Mervin Song, J.P. Morgan)

Mervin Song (Analyst, J.P. Morgan), William Tay (CEO)

Mervin Song asks about DPU accretion including rental uplift at 9 Tai Seng Drive and about the property's power capacity and Shopee's lease renewal outlook. William Tay explains that rental reversion varies widely across expiring leases, that Shopee holds two three-year renewal options with no indication of downsizing, and that including the reversion raises accretion. He declines to disclose exact megawatt capacity and states a 3% borrowing cost assumption.

[00:13:34] Mervin Song (Analyst, J.P. Morgan):

“if include the rental outlet from Tang, what would the overall, uh, creation be”

[00:16:44] William Tay (CEO):

“the incremental 30 million plus whatever renter up believe, uh, is easily close to 7% incremental”

[00:22:28] Q&A - Question 2: Shopee Long-Term Commitment at 5 Science Park Drive (Derek Chang, Morgan Stanley)

Derek Chang (Analyst, Morgan Stanley), William Tay (CEO)

Derek Chang asks whether CLD continues to operate 9 Tai Seng Drive after the acquisition and how the fee arrangement and IT capacity expansion are structured. William Tay confirms CLDC remains the operator under a fee-based arrangement rather than a master lease, cites an FPI margin of about 70 to 80%, and notes leases signed in 2022 and 2023 sit well below the current market range.

[00:22:28] Derek Chang (Analyst, Morgan Stanley):

“wanted to ask a follow up on, uh, nine Tyson”

[00:22:53] William Tay (CEO):

“The operator remains the same. Operator is CLD, uh, CLDC, uh, which is a, the, the data center team under CLI”

[00:30:25] Q&A - Question 3: Acquisition Yields & Placement Equity Sizing (Dale Lai, DBS Bank)

Dale Lai (Analyst, DBS Bank), Khoo Li Sun (CFO)

Dale Lai asks what share of leases expire in the next two years and whether the 5 Science Park Drive valuation already reflects a possible Shopee lease extension. Khoo Li Sun says little is due for renewal in that window, confirms a longer renewal could compress the cap rate given the original lease term was seven years, and states both acquisitions are structured to be tax transparent.

[00:30:25] Dale Lai (Analyst, DBS Bank):

“maybe you can share what percentage of the leases will renew in the next two years”

[00:31:33] Khoo Li Sun (CFO):

“the original, the first lease was signed for seven years”

[00:38:49] Q&A - Question 4: Debt Headroom Post-Acquisition (Rachel Tan, Macquarie)

Rachel Tan (Analyst, Macquarie), Khoo Li Sun (CFO)

Rachel Tan asks whether the 30 million deferred payment for 5 Science Park Drive is still payable if Shopee does not renew, and about 9 Tai Seng Drive's occupancy history. Khoo Li Sun confirms the 30 million is payable regardless of renewal, that the rental underwriting assumes a 15% reversion, and that 9 Tai Seng Drive has always been fully occupied based on available power.

[00:38:49] Rachel Tan (Analyst, Macquarie):

“the 30 million will be paid regardless of whether shoppe, uh, renew”

[00:39:19] Khoo Li Sun (CFO):

“if they do not renew, uh, then we believe that the, the market has shown”

[00:47:07] Q&A - Question 5: Tai Seng Data Centre Competitive Dynamics (Vijay Natarajan, RHB)

Vijay Natarajan (Analyst, RHB), William Tay (CEO)

Vijay Natarajan asks about further acquisition and divestment plans beyond this transaction. William Tay says CLAR continues to evaluate redevelopment, including the London data centre, remains active on acquisitions in Singapore and Europe while monitoring the US, and states CLAR is looking towards divestments of about 300 or more for the second half of the year. He confirms no further equity fundraising is needed this year.

[00:47:07] Vijay Natarajan (Analyst, RHB):

“can you talk a bit more about beyond this transaction, what acquisitions”

[00:48:09] William Tay (CEO):

“we probably can look towards about, say about 300 or more in terms of divestment”