FY 2024 Full-Year Financial Results Briefing

Good morning. Yeah, I hope you all are feeling great today. Happy New Year if you're celebrating. If not, I hope you had a good week by last week. I'm Allison from the investor relations team. We have the management here with us today as well. I'll introduce them later during the Q&A. Took things all this morning, Tony will share his highlights for the full year results. And now I'll invite Tony on stage to share his insights.

Good morning. We wish everyone happy New Year. Happy New Year. So, in the meantime, this is certainly a share. Obviously, we know entering into NIFA is quite uncertain here. Given what's happened late last year, I think as I go through the presentation, I think we are quite a position to face any car challenges ahead. So, I think we continue our efforts to really quite tune our portfolio, I think for the last two years or so, in anticipation of potential changes in climate, on environment.

It's like to slide five. So, I think this will be a key anchor going forward for next couple of years. And we anticipate we will be continue to be quite active in looking at how we can even further strengthen the portfolio. A couple of things we have been doing over the last two years, I think bearing fruits. I think these are a work for our efforts that would always anchor such as this stronger as we go into the year after year. Next slide. I think it would be very just to ask the recap before I go to the full financial year.

Just a quick recap on why activities has happened, so that you have something bearing, how that number sets gone into our results. We started earlier the year when you announced AEI for IMM, the world actually started in about second quarter. So, phase one, phase two, a large part of the space. Mostly at the supermarket area that we were claiming back, and we had done a little bit of recising and of course, to introduce other retail trade. With the aim of bringing in up to in total 110 hours in IMM, our workshops in IMM.

So, there would be one of the strong anchor. So, we announced that AI, they went on with initially, phase one, phase two, and the fixed part phase three. So, there was some incoming pack in 20 to 24, but no, it started to stream in towards the end of the year, and those phase one's phases were the impact that income was done contributing again. I also forgot to mention that Gallileo, we took back the building at end-genry, so income frozen there, so we are no income for the end-genry for Gallileo.

So, in the income gone, IMM income as far as I think part of it is gone also from second quarter into quarter. And then we also completed, as you move along the timeline, the CQ @ Clarke Quay AEI, there was announced that in last year we did that. So, it was completed late, late, late part. You know, the official activity will be around the quarter this year, so that also started to see some contribution coming and clicking in. And we announced more AEI work at Sigma One or building one or one dollar, really to uplift the overall quality of the building.

101-103 Miller Street we can't be able to do with more value. And it's one of the, I will say, the vintage premium grade of this. So, I would say, vintage premium building, and no signe. Last few years there were a few newer buildings that came out pre-meme level, but this is really the first vintage level. I mean, it's like our capital tower here back in maybe early 2000s. They were the premium grade. So, it's quite timely to bring that all back. And I think more than an hour's agreed that we should spend a little bit more money to uplift it.

And we got very strong tenant effect, even prospective tenant, like it very much. I think we are potentially seeing a bit more traction from a listing front. So, AEI over there completed. Other area that we're going to start looking at is more of the retail component, we'll be calling a greenwood plaza. And we also done a couple of jobs going to a portfolio. Probably well known we acquired ION, completed in 12 September, no, no, completed in 30. After AGM 30, 31 October, we'd officially over.

And then we'd have a certain CQ @ Clarke Quay. It was completed somewhere in the middle of November as well. So, a lot of activity happened over the year and it would make no noise. The number is a little bit more difficult to rationalize, but I thought it was quite good to just go a little bit recap so that it recalibrate the tenant. So, we're going to start looking at the $25,000 in $6,000. There's a little bit of projection going forward. So, we are pleased to end the year in a very strong position as a result. If you look at all the matrices on sequential quarter to quarter is improved,

a little attached on portfolio, occupancy has gone up to 96.7%. Sequentially about 0.3%, 0.8% basically across the tree packets. Other matrices, which are touched on later on, I think it needs a little bit more elaboration. Ten materials here is portfolio, and it's 8.8% in the office, sorry, reversion. Office reverses 11.1%, give it a little bit more color later. It just deals up to 0.4%. Again, I'll give a little bit more color, likewise for traffic, and see the occupancy cost.

This is just a visual aspect of how it happened. I think already I mentioned at the upfront, you can expect more contribution to identify what I'm meant as we work towards completing the phase tree somewhere around the quarter. For Gallileo, the work is working with the workbook on the ground is progressing on schedule. So, if nothing is no slippage in time, we expect we have no more computing somewhere around maybe around the quarter.

This way, you can start to see a little bit of revenue recognition. This is structured such that we can have a more matching in a revenue and cash flow. Unlike the long big lasers that we have, the grid when you have no fed up period, no, the beer run free, but this one, we negotiate a little bit more balance as we get some payment. So, any kind of incentive or free bar adding is all, even though it was throughout the entire list.

So, likely to see revenue income contributing around maybe hopefully one of the quarter if you're on schedule, but more significantly than in the other end of the day. We also don't anticipate any kind of distribution coming from Gallileo into the end of the end. So, it's a ramp up, it's too expensive to pay, but more substantially adding will come from June 26th. So, for the full year overall, numbers are quite decent, I'll say, given the background revenue increased by 1.7% on year and year.

NPI about 3.4% on year and year. Other measures are pretty healthy. We managed to bring down the leverage to the 8.5, give us a lot more hate room financial flexibility to look at potentially even more new AEI in. So, we are constantly doing all this work to make sure that our quality of the asset quality are maintained, ensuring that we are always planting new flags going forward where we can have new revenue streams. So, we have that flexibility now, while it happened in the market. Cost of debt remained fairly stable about 3.6, compared to last quarter.

Overall, I think we have all lived up the fixed rate borrowing. In fact, when we did the divestment of the CQ @ Clarke Quay, I would say most of the funds were used to pay down the short-term debt. There's a little bit on the high sign. So, overall, on the hash level 81%, I think we are very well protected. Wherever outcome, we don't mean to be facing the financial market. portfolio valuation has gone up overall, part-wise, 26 B, 6.2%, Singapore obviously is a strong contributor with our ION Orchard coming in, minus of the CQ @ Clarke Quay that we have invested.

Germany helped well, Gallileo as we went up, and made sure it came down, but overall on the net basis, it's gone up. Australia, unfortunately, the cap rate expanded by 100 basis point over the year. So, the entire valuation has been affected as well. So, net basis about 6.2% that comes into our valuation. Second half, so this number may be, Gallileo be explained. Second half, we accounted ION Orchard as a joint venture.

So, the revenue NPI doesn't flow in here. So, it would be more a share of the joint venture result. So, this is only reflecting on the current set minus that the CQ @ Clarke Quay. Now, we're standing there, I think our overall, still growing, 1.3% NPI. We've got the CQ @ Clarke Quay, and we've got the Olivier contribution. For a year, I will not touch much. Maybe just move on. This is just a step-shot view. We are solidly in no single part of anger, no almost 95%. Having said that, I think this activity, we have done that result in this kind of composition.

But nevertheless, I think we will continue to be a joint and see what else can we do to further find you out portfolio. On the deep view front, sequentially, it's a growth 5.4% to 5.4% from 1.5% to 1.5%. Second half. Second half. Obviously, you have a bit of noise again on those things I mentioned. We acquire ION Orchard. We raise equity, fundraising, completed only in October.

It's a time lag difference where we have the large base, but it's not matched by the corresponding contribution. So, you would add that in, let's say assuming we did a equity fund raising starting from September. We did a year for our idea placement followed by a pre-off ring. There were added in about 0.07%. So, you have been a 5.5% to versus a 5.4%. On the lag for like this is without dilution. So, this is a little bit clearer how on the normalized run rate how we look at it.

Correspondingly, at the same point, it would be potentially about 10.95%. If all through year matching the initial year of half income coming on the day is a little context. So, I think overall, hopefully it's done pretty solid. We have some contribution from ION Orchard for the two months or so. So, that will also help. Please say that I think the ION Orchard performance is better than what we have earlier projected. Right? I think this goes too much. But generally it does help to uplift a little bit.

So, if you recall, we did the announcement on the fund raise. Some discussion with the investors and how we should look at the number. We projected the fee units may have to go out. This time, we did not. It's all maintained on a party on a life for like basis, 50%, 50%, 50%. So, your comparing completely on a 50% basis. So, I think we are pleased to say that the underlying portfolio strength has been able to push through plus the better performance for my loss.

This one is just more a little bit more for you to note. I mean, whether your investors, as you think investors, let me speak at least last year, you get your 3.29 cents. So, any of you per unit has gone out for 2.09, on the back of the valuation that has gone up. So, I think we are trading probably about 6, 7% below around there for any of you. On the debt maturity fund, which I won't leverage too much, I think we have a little bit of a small tower to deal with. Part of it is actually from the Euro loan.

So, we do expect the rate to creep out. You was locked in years back. But now that that's I think the aspiring tower will probably in the low trees. So, there were people potentially a little bit of living overall cost. But we try to manage that. We try to manage the draw down as little as possible. So, it's all about very active cash management, right? And sharing that you don't have to carry very expensive cash in your account unnecessarily. So, I think we have been doing that successfully over the last 12 to 18 months, minimize the draw down and sharing that you have heard of manager interest expense.

I think this represents the balance sheet pretty healthy indicator all throughout, you know, leverage went down to 3.5, I mentioned early. So, total ballroom came down from 9.4 to 8.9. The other matrices, 81% fixed again very, I think it's going a good position, given that volatility interest rate is still ongoing. Interest coverage should be in-shot a little bit, no trip by one times, and average duration should go on up to 3.9.

So, no orders, matrices seems to be lending in a nice position. Average cost of debt is 19.6%, which I mean, elaborate early on. So occupancy, you can see throughout the trip back good overall, it's going to be 96.7 for 96.4, but across the trip back good, always improve, right? This one is just skip. Just skip, yeah. So, we'll be quite actively managing our aspiring coming due, you know, a few percentage points are already in discussion.

We do expect it to be a positive kind of reversion number. We won't disclose too much at this point in time, but broadly, I think my colleague will join us, you can have a little bit more Q&A. This thing remained healthy. I mean, the talks where there is quite a thing, I think it will reasonably be okay, you know, fourth quarter even the office will manage to close 97,000 square feet of space, not too bad. Slowly, it slides low down from the quarter, but maintaining very strong retention. You know, a lot of tenants are already deliberating what they want to do, you know, things seems to be changing.

More people are back to the office, whether they should expand, couldn't track, look at economic environment with a new administration upon the US, how to affect the overall outlook in this part of the world. So I think there's a lot of deliberation. Given that context, I think, generally they are listing activities, still looks very healthy, yeah. So we closed 1.1 million last year in total for the return of the space. On the retail space, again, across the further sub down, sub over and down town, I think we aging up as a portfolio.

Retail space 93.99.3% in shop for 99%, fairly adding quite reasonable movement. Of course, it's always, almost full, right? 99.9% and now it's in shop for 98.8% in 98.8%. Yeah. Reversion number earlier, I alluded to quite healthy. Both are open and down town, almost 90% about that. So this is, I think, the trend. I mentioned a couple of times, there's a bit of catch-up with during COVID, where we have to do some random adjustment, and then because of the factory agreement, we do have to pay a pace out the adjustment over time.

So, during 24, it's a continuation. Maybe a little bit of a 25. And going forward is all really about how the retail trade, the 10 themselves are able to trade well. Occupancy cost ratio become even more important as we come to better, lending on whether overall cost structure will look like. For us, also for the tenant. So, tenants here, so this is just a breakdown. So, this one is a little bit of elaboration. So, overall, what we have done is we brought in ION Orchard into the whole bucket, right?

The number, right? So, the retail sales include the per square foot ION Orchard. So, that elevator on the per square foot yarn here. So, it's not exactly really like for like, but it's important to just spin a snapshot as we end the year. Because going forward, you will always encounter all these comparisons here on year, a little bit on noise. But the start there will be, give you a good sense, how that composition will look like. If we strip out ION Orchard, we are looking more like a portfolio, retail sales around slightly around slightly less than minus 1%.

And then downtown will be probably about 1%. So, it's about there, right? And so, I'll go ahead and help very well. 0.4%. But the next few quarters going forward, you will present that in the manual so that you can see the trending as well for us to be able to maintain some kind of useful info for you to do as you look at your projection, how the retail sales will look like. Similarly for software traffic, we just pop in the ION Orchard number, so it looks like big jump down to 70%.

But you distribute it out as high on, you'll be more like an 8% rather than something. But it's still a very healthy uplift. Again, this is, we always present it, just to give you a bit of flavor while the things may be doing well, not doing well. For the ION Orchard number, you can see that, you know, trade like jewel was just a spike out, right? Because, you know, they do have a retailer that are in their category. But it's more for me and for a rest of the team, it's a track going forward, how that trend will look like.

So, you can see a lot of component now of our trade mix is coming from a pretty higher value kind of a retail type trader. Yeah. Just quite a little bit, I think, you know, I'm not really standing some concern about the general retail environment here, given all the challenges, strong-singing dollar high cost base, retail liquidity, and fine demand power. I think we continue to be able to track good new market. And there's one that is very strong-shying. Key reason why it's underpinning the portfolio strength.

I believe it's always able to source out any of our good team here on the ground, on the upstream here. So, I think maybe some of the other things. I've been scouring out the region, the world trying to find your concept, bringing in ideas in sometimes a bit defensive. You know, we also want to energize activity in a CBD, the C-C-C-C-2. I mean, if you're not been to C-C-2, it's the latest, it's a nice scene place to go to. Good concept, but in the CBD environment. It's a very good reception.

So, I think that was strongly and not just helping our own building, but also may help the percent in our locality, where CapitaGreen is located. So, we help to strengthen overall CBD locations as a PUS location, but also anchor our building very well. So, we are able to bring new concept. The very popular in the COPY, everyone in Roxy, or the JB, I say, why go or they might just come to our Bugis Junction. So, we do a little bit of defensive measure, things like that. Make sure that we are able to anchor our set, look at the competition, not just in your next door, your neighbor, but also competition from the neighboring country as well.

Yeah. I think that's a great idea. That's a good one. So, on the office side, overall portfolio is occupancy has gone up 0.2%. If you cut across the tree, back it again, Singapore obviously has gone up. Germany is just the only one that we are talking to, we are talking to Gallileo. So, MAC got a little bit of challenge there. So, we lost some tenants who decided to downsize. And hence, the occupancy has come down a little bit. But also very pleased to see that we are getting some traction, also in Australia, so overall occupancy of experience got now.

This is what we presented. I think just the long short story is that I think overall our expiring rent is not out there. My account numbers, quite close to where the market is. I think we give earlier before some investors do our guidance, 25 minutes, six. Look at the expiry. It's probably not far away from market. I think we have a good, this and shortly getting a positive reversion. Well, I'll stop here. I think the rest, maybe the last one was like just on some point.

Just to ramen it up, earlier I mentioned this year, getting to look out for completion, I am in bringing that inflow more than 25 or 24. So, completion of the LIVU, 25 into the next little part, and 25 into the next six. And we will continue to be looking for new avenues for us to even strengthen the portfolio further, anchoring ourselves even stronger in Singapore. With that, I think our end of presentation, I'd like to invite my colleagues to join me in the next few months.

Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you.

Thank you, Tony. Okay. Before we start the journey, I'll introduce the management. So, on Tony's right, we have Mei Lian, our CFO. On Tony's left, we have Jacqueline, our head of investment. And on her left, we have Yi Zhuan, our head of investment. And some housekeeping rules to not be forward with start. If you have any questions, please raise your hand and wait for the mic to come to you.

And please stay where you're from and your name. And please try to limit your questions to two per round. If we have more questions, we can come back to you. All right. With that, do we have the first question? Okay. Maybe my room for one's lady's first.

Hi, good morning, Tony. And Tim, thanks. for allowing me to ask the first questions. And have been here to all. Maybe just one, I think we have heard news that, you know, there's F&B closing in the Singapore market. Quite a number of retailers are closing. And you have also guided that FY 2025, you'll be looking at the retailers performance. So, just want to get a sense. Are the retailers still sent in on why are they still positive? And would you still be able to push your occupancy costs from 17% now?

Yeah.

So, first part of the question, 3000, I think there was a 3000 closure report that in the news. But there was also a 3000 seven new opening. So actually on the net basis, it's an increase in F&B opening. I think this is a process island right. So it's in a way a reflection that there's still, I mean, foot is still a basic brand, but the staff that most people would turn to. The challenges of cost environment is real. But nevertheless, they are still good concept.

They can do well. And the tenants will be better coming in. So I think that the kind of mood I think we'll probably, like the moving between 25, obviously the environment is a lot more uncertain. But broadly from F&B space, I think people are quite curious about new ideas. I mean, it's a consumer driven trend that would sort of anchor how F&B operator decide whether they want to be here or not. That's one monobrop picture.

But there's also quite well accepted, I think, that there are a lot of F&B operators using Singapore really as a launch pad. They wanted to see whether out of the original country, new concept, new form foreign country, and they wanted to use Singapore's launch pad. And naturally, I think we put, then should be one of the fuel and not that we reach out to. They reach out to.

And we have that good blend of sub-end autor offering that they can present to. So I think even, let's say there's a bit of a reduction in appetite, but there will still be new ones that require the coming. We probably will still be one of the landlords that the autotend tool may be 20 or less, something, some color.

Yeah, I think just like going what 20 said, right now when we look at the F&B, we also within our portfolio, we do see a lot of interest coming actually from new cafes. So I find I think generally in the market, we know there's a little bit more challenge now because of high cost environment. But at the end of the day, if you look at it, and I look at it broadly, right, not just F&B alone, if you look at our retention numbers, it shows that actually this retention number 80 plus percent is very strong. And this actually includes the part that you know where we actively curate what the brands we want to achieve.

We thought about tenants who want to stay here, a lot more. And if we look at the every quarter where we share the new tool markets, right, you see a lot of new F&B brands. So she a lot of time for you to select which F&B put many pictures to put right here, you can kind of write size a little bit. So that shows that actually that is actually good demand. But what I would say generally would be, the F&B entrance coming in now, they actually do come with a higher value of financial banking support on those that control overseas and they're very selective about the locations that you go to.

Definitely those that are better curated more also better located at most will always be in demand. And that's why I think it reflects the more occupancy.

So the second part of the question is more on occupancy cause whether you can still push higher, whether you can give the breakdown. So we're going to down down to occupancy.

If we look at these occupancy costs, that now we are roughly about 15.16% and if we look at the down panel for the eight plus, which is actually quite in line with what our numbers are. I mean in previous sessions we have also shared that of course it's just one component. It makes a lot of functions right. Whether or not that we can have a room to stretch. I think it's the structure of these numbers. We are the other ones that we sustain for that, you know, the tenants that are in our most. We continue to do well.

Thank you. Thank you. Just a second question. Any updates on the text transparency for our year?

Okay, we have written into IRAS on the on seeking text transparency and the post structure that we have in mind. But we need to, you know, this is an ongoing process. We have something that we will update with very small clarity. Still target me this year. It all depends on, you know, when IRAS can come back to us. And we need to be there on going, you know, review. Given the global apps that is implemented.

So this is also a position that IRAS will have to review.

Okay, thank you.

Okay, next. MaVin, you want to go?

Happy New year, Tony Tan and team. Congrats on the quality results. Make it start on the fees and units. Post is surprise. Any guidance for coming year. And ION Orchard mentioned is doing much better than your underwriting assumptions. Our CMC last close was 96% and it details on that and ten sales for IRAS. And it was an up year and year. Or maybe they are due to softness and luxury sales. Thanks.

When we presented the proposition to acquire ION Orchard with fundraising exercise. I think we projected 70% and I feel potentially may go up to. And we have also been very clear how preferred option is really not to. So that was still going to be the position. We are right the year well. The portfolio has performed well. We have reasonably good chance not to move up.

We bought the text transparency. So I think that again required February of monitoring. Making sure that the expenses under control. Managed interest expense well is ultimately the distribution that we're determining how investor will react. But in the patent order, they are right at the bottom. How you want to deliver the DPO. In terms of what else you are asking about performance. Yes, it's better than what we have under returned.

Hopefully more maintenance sustain. There were also AEI work that were ongoing at the time in 2020. We can also see how it's going to be. So we can also see how it's going to be. So I think that we are going to be a part of the year. And hence you see some uplift from there. But they also plan the AEI going forward into the five as well. So we will see how things perform there. Broadly, I can be too specific. Occupancy has gone up. Close to 90%. We don't have that year on year comparison. Because I mean we don't have to over end of October.

So we can comment on that. But generally you look at overall luxury retail trade. And I don't know if this is not that luxury. Overall luxury retail trade has softened around the world to different degree in different countries. So Singapore is not spared. Overall is slowed down. But again, I think if you recall, I always have a very unique animal. Yeah, it's a product that cut across all walks of life, different income stream.

No, served the desire of different consumer type. And on balance it's quite well curated. So those bottom type. If you go to ION Orchard, it's still relatively busy overall. So they are also looking at upgrading AEI work to do. So I think there will be some balancing effect. Some trade down, some trade up, potentially. I don't write to a different economic cycle. And what you need to feature about ION Orchard because you look at the retail trade. The little pie chart show.

I don't tend to have a higher component of the turnover sales. Then our typical model. By nature, because the ticket size of bigger, it can be lumpy. It may be seasonal. It can be lumpy. It also depends on economic environment. So that's the one that may have some variability. But overall, the base run is going up. Like the rest of the order you have seen in that's reported. So why is that the base run is going up as well. So that will question.

Okay, perhaps, Geraldine.

Hi, one thing Tony and team. Happy New Year. Maybe just want to get your thoughts around the operations of cinema. Cinema. Given the recent use of Kati closure. I mean, luckily they are not in your most. But you do still have, I think, sure and a GV. Any opportunity to downsize these tenants.

So cinema, we do have some exposure. Why is this not a lot less than 1% in total GRI contribution. So when a risk exposure perspective is really not significant. Right now, I would say that the good thing is that like others are still paying rent. They are currently in rents. So that's a good thing. But just a sight, I would say. We have already kind of identified cinema and how it's actually going to develop this powerful things. You know, people go at Netflix. Now, these people rather go play games or social media or rather than the wash movies.

So within our asset plans, we do actively locate whether or not there's alternative users for it. And actually, how we can reposition some of the space. But having said that, we have to be mindful that in foreign cinema, typically they are located in the top floor or the malls and some corners or the malls where it is not naturally the first full-fault kind of heavy-fault-fault area. So it needs to be very targeted approach when you look at this and talk to the kind of alternatives that we are currently looking at and see how to fit them in fully. Yeah, so but definitely if you kind of replace cinema eventually at some point in your look at it, right?

One thing is that the sales efficiency that we will get because they do occupy more space and whether in terms of sales generated, it's a little bit on the lower end. In the past, the reason why cinema's were very, very strong propositions for malls is because they actually bring in the crop right. They draw in the ... It's almost at loss leader, right? You bring in people and then hopefully they bring up the rest of them more. But currently we have to reassess how this fits in the overall strategy. Thank you.

Okay, thank you. Can I also ask about interest-cost guidance? Yeah, just a quick one for you.

For this year, I think we have, of course, one billion of borrowing to be refinanced. And I would say the average cost of this debt that we're carrying now is in the low tree range compared to the current spot levels, which is closer to more than 3.8. So in terms of average cost, I think the guidance would be likely in-shot, well, we'll still be below 4%. We are now at 3.6.

So the increase will not be so significant compared to prior years.

Paul, Vijay, we had a question, right?

Hi, morning Tony, happy new year. Just two quick questions. Firstly, in terms of capital recycling, I think last year was a good year in terms of both divestment acquisition. And you have got your gearing lowered with 21 Collyer Quay. So what are your plans for 20-25 in terms of divestment as well as acquisition? There was a talk about citadel in reference place also, right? divestment.

So with the divestment of 21 Collyer Quay, we have lowered the gearing to around 38.5%. So that gives us more hit room in looking for new investments and other opportunities like the AI or redevelopment. So in terms of divestment, as we are asking us, I think as part of normal business operations, we always constantly evaluate the portfolio as set by a set, right? To see whether what is the highest and best use and whether we should divest or whether we should do an AI or whether we should do redevelopment.

So that continues for us.

Okay. I mean, can we expect similar divestment and acquisition this year, like 20-24 within this cost, you know, beat? I mean, are you more optimistic in terms of capital markets for this year?

If there's the right opportunity, we will definitely be doing them. So, yes, we have the right asset.

So I think the way our characterizer is that Jack was putting across is a BAU horse. portfolio reconstitution, we still have some journey to go. And we have evaluated every single property we own, right? What potential we can write through? Visa Visa was changing the market. What a railway can think about whether it's a retail development that would require a beer engagement, authority, and sizing up the market over there.

What it makes sense. And there will be also some assets we say, okay, is it going to be a run on the meal? Maybe it's going to be very slow organic growth, but because upscaling may be tough, there will be one packet that we say, okay, let's go on to it and see how the, how the, how the landscape looks like. Because very difficult to just talk about investment without considering capital market, because in your financial capital, and if capital market doesn't exist, then what else can you do? Is it a third party money that you can look at, or maybe potentially somebody interested in a property that we dig this?

Yes, so likewise, when we assess the investment, in a mile, we see how we're going to redeploy that, right? Constantly having that continuum that we are evaluating. Number change all the time, sometimes the number, because for whatever reason, industry are going down, it make it more possible as possible. Flutter activity, capital market activity become active, and there's a lot of investor, very hungry, in versus A, can you present something for us to look at? Yes, then we look at it very actively.

But nevertheless, it doesn't mean a drop-off operator is always in our mind. While our asset team work to the assets, deals will bear in mind what will be a mid-long term potential or this potential asset. Sometimes we say, okay, next five to seven years, this is something we want to do, then you have a plan along the line. So it's a continuous effort. So I cannot pinpoint the 25, 26, for you know, and all you can be very active again, never know, right?

So my second question in terms of office, specifically, do you see any impact from Keppel South Central or any available links here? And is IY IOI Central Boulevard impact fully already priced into the market?

Also for office market, IOI Central Boulevard we have heard is around 75% pre-comitant, and they are quite vocal in saying that they are on track for full occupancy by mid-year. In a way, I guess that the market is kind of thickened that, you know, as done thing. For Keppel South Central, of course, we're here right now to take out the stock strong. But having overall, the new supply is still tight if you look at it in a tree or horizon, right? Because after this one, the next one is short-power, which is pushed back to 2.6.

And then if you look at the shadow stock as well, it's actually not very high. It's actually more around 200,000 plus-square feet. If you look at the secondary stock that may come from some of the movements of new competitions, it's actually also quite manageable. We are compared by 600,000 or less, right? If some of these companies happen. So like method space, south-beach size, well, well, kind of back-fill. So by and large, I would say that the demand supply still is relatively healthy. I think so far we are not seeing any of the land loss also under pressure to really drop rents. So I think it will be a good shape for us.

Thank you.

Perhaps we'll pass a mic to Guadalajas and then we'll go on to the online questions.

All right, thanks. Well, congratulations on them. Better performance. Just wondering, what's your interest rate outlook for this year? And how do you see it impacting your cap rates, especially perhaps in places like Australia where you have that huge, quite substantial take down in your valuations? And the second question is, what is your preference between redevelopment, AEI, acquisitions and divestments? I have one last and third question, but I'll ask that if I have time.

So this is our view. I think maybe probably in question by what the spend in Australia market right here. I think generally you've seen this high-tech activity happening last year on the transaction of land. Pardon me in office space. We've seen quite a few of our favorite transactions that solve and encapsulate why the expansion happened in 24. So it's about on average, you're looking at 6 and 1-1% and 6-6-1% of the acquisition cap rate rate. So, but you're so signal to me that things seems to have normalized, stabilized, and normalized, given that there's a little bit more matching of bias and demand investment sentiment and the land of what we prepared to redeploy the capital elsewhere.

My sensing is that we probably quite based in Australia around the level. RBA interest rate has helped very, very firmly on the high. Perhaps market has a certain view that, first of all, unlikely you'll go higher and the next move is likely going to go lower as question of timing. So that could be that one strong motivation to drive some investment activity back in Australia. So that's more of a capital flow perspective. And that is probably the more defining variables that we look at the valuation of Australia.

So it's a highly transactional market and highly dependent on the transactional cap rate as a determinant of the value. Putting aside, of course, the underground data with the operation of the cryptocurrency demand that's a different picture. It's a bit more, I think, than say, two-tier market, maybe you want to level anything in the city of this market.

So for Sydney, of this market right now, it's very clear that the core city, the core CBD and the premium stock, is that she's starting to see some recovery. But the rest of the French CBD locations, as well as your alternate CBD locations, are the ones that are still a little bit struggling. By and large, I think that progressively, you hope this year we will start to see a stronger cause for return to office and that should help property money. If we look at it right now, the incentives stabilizing for the core premium properties is not extending to the rest of the asset types.

But clearly, the BNC rates are the ones that's really struggling and they would probably end up having a structural curve. They can see issues going along. And that's the reason why when we look at some of the assets, we have been very relatively proactive in upgrading those assets to ensure that they have the specifications that is relevant to the tenants in the city's market. So like 66G, it's very, it's located in the town close proximity to the core city and cause of specs, it's actually reasonably well. It's one tenant base, as far as the SOPP is holding up quite well.

And we are actually extending, I think for the earlier mentioned, we've been doing so upgrading those to 101 or more. And then of course, we will try to backfill some of those things. Probably if I may just touch on a little bit on North Sydney. So North Sydney is also undergoing a little bit of challenge and the big cross station coming out, big cross is slowly ramping up the occupancy. We do believe that even though near term, there's a little bit challenged, the development of big cross together with the other new products like one that is sent right. Actually, it's uplit the quality of stock in North Sydney and hence it will, in the mid term,

like the making it more viable and attractive or the notification. So we believe that North Sydney will come to see a bit more positive growth in the community.

You should interested in that, let her answer.

Okay, on interest rate outlook, we are watching market developments. It really depends on what Trump measures will be in terms of his administration. The tariffs will have an impact on inflation in the longer run. But in the mid term, we are seeing in the market, there's a softening of rates in recent times. Their concerns over the economic outlook as well.

So right now, the U-COV have actually kind of flattened. We have seen floating rates decline over the past three months. We now add 2.6 to 0.7% for floating rates. It used to be above 3%. So in terms of our capital management, we have actually kept a portion of close to 20% in floating rate. So that could benefit if we see a continuous decline or slow decline in floating rates. But on the fixed rate, as I mentioned, the current spot levels are still high trees.

So if we have to look into refinancing long term debt fixed rate, we would likely have to pay up more based on what we are carrying on our books.

Can I ask one question on Malaysia? Because by the end of next year, yes. The RTS will be ready. And do you see any impact? I mean, could you look out further than just this year? And if you see any impact on any of your malls, I know you don't have anything on that area, but would you see any impact? Whether it's negative or maybe even positive for I am in.

I think on aggregate, it definitely is offload for sure. Because you're making the in and out more seamless. And you rightfully mentioned it may not just be a single wave flow, it can be a two wave flow. So we are watching. But importantly, I think we've been very proactive in the last two years to really look at our portfolio and see what we can do to at least re-infains and be a bit more defensive. Whether it's in Southburn or in downtown. A couple of activities. Whether I am in Iraqi, we are even planning on now.

A few others that's in downtown for a different kind of posturing rate. So these are all activity that are geared towards in anticipation, where they come or through or not to ensure that we are prepared. To what extent you impact, I think there's too many variables. Across comparison is one factor. Whether our shoppers here prefer to do it in across the border, there's one factor because the delta, the difference on the price they have to pay.

Versus efficiency, convenience. I think all those things are not so easy to measure. If you say that closer to the border, potentially, yes, easy, right? Instead of doing a few rounds of change in your data, multi-line, then before you hit the RT, yes, man. And then there's only a writing at Malaysia border, and then you talk about going on. So the further away, you can imagine the intuitive view that is probably more less impacted intuitively. But hard to say. Again, we cannot rule out Singapore as a destination or so very attractive for all of this stuff.

So whether we also can attract good inflow coming in. So even if our neighbors in a northern region who are able to curate a very well presented offering, I would not be surprised we see Joharean relation, or even foreign visitors to Malaysia, decide to eat, pop in Singapore for a couple of days. So I think those strong dynamics that we are, I think we are constantly reviewing. And you wouldn't really know the food impact until the things really happen. But what we can do is not to prepare yourself for that.

And then the choice between redevelopment, AI and acquisitions and type of things. Very hard to put a choice. We do that for different reasons. Red development is about relevance of that. As that's to the vicinity that you are targeting or the market segment you are targeting. It is already outdated. It doesn't make sense anymore. Given the landscape exchange completely, then really development may be the best number one choice.

Development is different. Development is about what is the best use of our capital. So if we have other opportunities present to us, yes, it's about improving your quality of portfolio. Maybe it is an input something else of a higher quality or maybe one that has got a higher runway than the one that you are exiting. So it's a bit driven by different motivation. AI or say really is in response to the more near-mitter trend change.

Sometimes you do a very high value. And it varies on the scale from a small reconfiguration or space for auto-entire change on a cluster. So you are very dependent on how the competition landscape exchange, consumer, data exchange. If you apply to an office or some minor AI or maybe relevant because certain space becomes potentially an inefficient space.

Then we may think about this space perhaps. Level one, one example. We are thinking about what we want to do at level nine. So this is an office environment. So we are driven by different motivation. So we'll be on Amazon.

Yeah. So from the credit to the asset management team, they have been actively working on other communications from very small scale AI or the way to redevelopment opportunities. One other thing I would probably just add to Tony is that sometimes you also have to look at timing that, well, we thought, what's small AI is right, and reconfiguration. The timing is very much within our control. We can look at these experiments profiles. We can look at when we want timing. When it comes to more major major AI or even we development, some of these, we have the factor in timelines or considerations that are not just within us right, but also the missing master plan,

land use change and stuff like that, which will be a bit more protracted. So even with our preference, and definitely we didn't ask we have a priority so which works for your own purpose, right? Of course, we've done it very important, but that's a site. It's really that, make sure that the timing fits, how things depend on. All right.

Can we just take a pause and then we go on to the online questions? Yeah. So we have a question from Jade from New Green. Any update to the DPU accretion expected? Associated with the acquisition of ION Orchard or chit? Prosperity that month has been for going to the next.

I'll put it this way. If we can continue the same run rate since we took over from an october, assuming the ION Orchard continued to perform on par of what we're done and doing the fall. I would imagine the contribution would, don't forget we actually did not increase the MFU.

What we say? It would be less than 1% in my view. You will be less than 1% here. I think we have variables there because embedded, okay, so backtrack. Earlier, I mentioned we account ION Orchard as a shell JV, right? So everything flows on a net basis of the text after interest course upstream to share how the self-enceong, right?

Also depends on what we need to retain over there. Let's say for K-Paxel coin, right? Historically, the distribution has been held in a high-night piece, right? But we won't rule out sometimes maybe you want to retain some over there. So that will affect the dividend upstream coming to both shareholders and to some extent, it impacted the CPU, right? So too many variables to attribute. But I'll see what we're doing already on our first thing. I think it's less than 1%. Am I sensing that?

Okay, on the next question from Derek DBS, how is management taking about management fees in units? Will it be the same as 3% or will it be more? And also capital top-ups for 2025?

Earlier, I did mention it's right at the bottom of the packing order. So if we can do it on the normal run rate, we won't want to touch JV.

Okay, we can go to the floor for question. Can we have tension, please?

Hi, Monique. First question is on EI. Your undertaking of view. Can you share what's the achieved EI on those that has been completed and what are going on what is the target? Second question is on portfolio reconstitution. I guess capital market aside, how do you think about Singapore versus overseas? Does it make more sense to add more children?

I think we did a new, you know, previous and now so mine. I think we're looking at the highest in good digital ROI for IMM and CAP key as well. So that's on track. On our actual ROI, I don't quite understand what you are trying to figure out. That's not within our sphere of discussion here. Singapore versus overseas?

We consider all market, of course Singapore is going to be a strong base and it depends on what's underlying. Our preference is Singapore. All things equal. Singapore is strong base. Continue to increase your leadership because we also know competition is catching our efforts. So we need to continue to be always leading the pack. And we get... Compact data changing after us, we think should have been better run faster. So Singapore, I don't think we can ignore it completely and it would be a high focus, or things equal highest priority here.

We've got a lot of things to do and it can be... AI can be redevelopment, it can be of course, if there's a opportunity for the party that we were sassy. But again, we are careful. Any card in our getting has to be something that we firmly believe. And you're right price, right? And this is the right price. You have many standard line capital source, right? What is the capital market source or private market? Or maybe our internal churning right?

So we need to consider how you're going to do it. So we don't want to be so locked in because we are in this stream market. And Singapore is going to be both side. So hopefully, you won't go away the idea that Singapore is going to be focused. We are more continue to be strongly and very single. We need to continue over time to ensure we have opportunity to increase the coverage also in our overseas assets.

Sometimes it's about a timing issue. When does it opposite me surface? In Germany, it was set no scale problematic in Australia. It's set no scale, not so easy. So over time, if you are planting your flag in some jurisdiction, not in your homeland, then we need good food for children of ground to be able to manage the asset for us. We've got a scale not easy to manage them. So that's the context.

Can we pass the mic to Derek, please?

I have just one question on the P&L side. On the tax exam in Cambridge, spiked up this second half. You expect to do a normalised back to normal levels going forward. And same goes for the tax credit. I think we saw this second half. It's a 12 million dollar tax exam in common.

I will come back to you on the tax exchange income source. On the tax credit, I will say not going to be like every year we have a tax credit. This is due to the tax provision that we have previously provided. And we've written it back after finalisation of the tax position with the tax authorities. So there's no more of that issue. Go back to expense. Yes. That's right.

Yes.

One question on IMM, are you looking to perhaps extend the land lease for IMM? I think it's down to 25 years. Instead of transfer between you and all of that.

If the opportunity or rise definitely will be keen to look at it. But I have said that it is something that is a cluster D right. So when it's too early for us to engage, we have been trying, but I think from talking perspective, they wouldn't talk to us until it's much closer. But definitely something we want to extend if we have a chance to. Okay.

Do we have another question from the floor? Okay. Moving please?

I think the previous quarter of the guidance for rental relations, very tip-off for this year was no single digit. It's something we are sticking to. We are raising to a single digit given the low to mid-single.

And definitely we are trying to, so far for what we see, we are trying to be around covering somewhere in this single digit. For the retail.

And terms of electricity costs, can you guide what rate you are being able to sign this year now to the compared to last year?

For electricity, actually we are looking for two to five. It's actually a good discount of lower than two to five.

In the teens now?

Not in every phase, I don't spot the in the teens, but if we look at all the around the chart.

Do we have another question? All right. If not, then Tony, would you like to share any closing remarks?

Thanks a lot for attending this call. Hopefully we have no surprise for you, the results. We talked today, nearly be explanation of the numbers, quite noisy numbers. And hence, I thought we better to run through the slides then while we did the previous day in the fire chat star. So, which we like, we kind of enjoyed. Before we end, I thought we want to introduce my new colleague, new to the team. We're a good assistant to me. We are a lot of things to do and to answer this year to help. At the whole thing, he used to, before he went to Malaysia, he used to hand clean, right?

You see, I've worked clean. You see something? By the way, that day on the day, don't pressure him.

Thank you Tony. I'm very happy to be back in Singapore, and I did see quite a lot of the media faces. Just give me some time. I'll get to know everyone probably over the course of the next few months. Looking forward, I think, obviously we were quite excited. Last year's been a great year for the ICT and obviously we are looking forward to do more things going forward as well. So, look forward to catching up with everybody over the next few months. Thank you.

Thanks, Shins.

Thanks. Thanks for having me.

So, thank you for your time and attention. Before you go, please help yourself to the refreshments outside the room. If further questions, please direct them to us. Have a good day ahead.