1H 2023 Financial Results Briefing

Good morning everyone. Very warm welcome to capital land investments first half 2023 results briefing. I'm Grace Chen head of investor relations TGI F everyone and happy belated national day to Singaporeans here as well as to those watching us virtually now see all I has had quite a week besides celebrating national day our teams who have been working very hard over the past few months and even through National Day finally got us through the finishing line of a few important fun races and I'm thrilled to share that year to date We have fun raised 3.2 billion of Equity commitments and what that means is that we have actually exceeded what we achieved last year for the full year of

2022 where we had 2.5 billion of equity commitments so colleagues want to put your hands together to just thank the hard work of our do teams Thank you Okay, just getting back into agenda in a short while we will have our group seal Miss Leechikun group seal. Oh, Mr. Angelim and group CFO Paul Tom to take us through the results as well as their outlook and I would also like to mention that we have members of our senior leadership Council over here and they'll be happy to take questions during the Q&A as well Without further ado our invite and drew for opening remarks Thanks Grace and good morning to everyone. Thanks for coming

I've got just a few remarks that I want to make before I hand things over to Paul to take you through the numbers We put down five points here that We hope will help to encapsulate what the numbers reveal I Think the first one is the issues that we've been grappling with for some time now as an ecosystem still continue to persist You can pick your poison whether it's climate change whether it's geopolitics whether it's pre post COVID the one we think is most stubborn and gives us a lot of calls for concern is The stubborn inflation that persist throughout the global economy and what rates have done in order to combat that I Think that you can all agree has direct impact on real estate through higher interest rates in funding and also potentially through cap rates in valuation

We are starting to see the effects of this particularly in some economies where the rate Risers have been very sharp US Europe UK have all started to see these attendant effects and when we look across the spectrum of real estate Companies who are reporting results. We start to see this in this interest rate impacts coming through We are no different. No, we are not immune to that, but I would like to think that our consistently conservative policy high level of fixed rates long whales long terms have insulated us on a relative basis more so than some of our competitors The other thing that gives us I think some case for optimism is that if you look back over 30 years Around about the five to six and a half percent of fed funds rate is where economies starts to take notice and

start to slow down So if you go back over 30 years This is where the rates start to peak and then it comes back down and tends to come back down very fast So if history is via students of history and we take history as a guide I would like to think that we are close to peak which again is Potentially cause for cautious optimism that recovery is around the corner and stabilization is around the corner Why is this important it is important because without a good visibility on where rates are hidden? No one's going to be doing deals because we can't underwrite them with certainty unless you are very brave or you're very foolish Which brings me to the second point about cautious dealmaking I think Simon will tell you that this year It's the lowest in five or six years in capital raised across the

private equity space and I think that again is a function of Folks who have put their pens down because they just can't get comfortable with the numbers The models have all been thrown out. They've got to rewrite they can't figure out where interest rates were land and without interest rates certainty unless you have 100% equity which not many people do Then it's very difficult. You have to be brave and and all foolish So this is has led to a slowdown in dealmaking right now we're standing that I think we had a pretty good first half Our reach raised over a billion Being very disciplined about what they what they are seeking to acquire or have acquired and our private equity business as you've read yesterday And today have now crossed over three billion in total equity raised again and we believe the right products

So I think we are Being very disciplined about how we Race capital or rather we are still able to raise capital from Partners our unit holders our third party equity partners who believe in the platform that we offer Our embedded FUM (Funds Under Management) has now grown to block 10 close to 10 billion Which means that we've got that equity? We've got capital ready to go when we feel the time is right in products like China opportunistic which is I think a very well-placed product for the right time ready to be deployed for the right opportunities Working together with the young and his team on a ground We also raise a new fund in India India now is receiving unprecedented attention Sanjeev is here. So please direct all your questions to him We are long India. We are 30 years in India. We have boots on the ground

We have expertise in the right sectors and in the right cities business parks logistics and now DC The launch new fund yesterday with one partner and there's we are confident that there's more to come so India is Exciting for us. It is still a small piece of the puzzle But if you are talking about a globally diversify real estate company then India is a core market and it will play an increasing role In how we diversify our business Okay, let's look at the two of our core markets. I think Singapore. We are all here. We know the story It's remained incredibly resilient and that's good for us as a Singapore company Singapore is a destination for capital's destination for talent destination for tourism all of these things play to our strengths Singapore portfolio, which is now a largest market in total asset terms

It's very resilient right in more by most metrics. We are past COVID numbers already and I think the rest of the world understands this Which is why capital is coming? And we have no shortage of people asking us to help them deployed into Singapore Problem is we don't have enough to pass to them So the hunt is on for interesting assets. We development opportunities up sizing up skilling taking advantage of Singapore's growing place as a center for business tourism talent capital. What have you? On our other core market It is better than it was but that I have to say is not saying much because last year was pretty bad So China is on the way to recovery

most of the metrics that you see a higher substantially higher NPI occupancy Tenant sales they're all heading in the right direction The problem is it's not heading as quickly as we thought it would so recovery in our view is going to take longer and If you talk to just young what you'll tell you is that what happens in this situation is that it weighs on sentiment and China is a very sentiment driven market I Think what we have going for us is a government is recognizing this and is pulling out all of its tools to kickstart the economy right fiscal monetary Now the tourists can travel around the world right there they're trying to send signals that they recognize the extent of the problem and they need to fix it

So I think that's a good sign that they are putting the economic recovery as a priority right now and that will help us Help turn sentiment To at least say that China is starting to become investable again in the meantime We are being smart about how we deploy capital opportunistic finding assets that are underpriced for the right reasons and that will write an exponential wave of recovery When sentiment returns that's what sea cob is designed to do we raised another five 500 500 and see come 986 sorry So it's a big number so we Causiously optimistic on China, but it will take time. It will take longer than we hoped