Bualuang K.E. Retail Leasehold Real Estate Investment Trust 4Q 2019 OPPORTUNITY DAY 25 March 2020
I DISCLAIMER Investment involves risk. Prospective should understand the characteristics of the Trust units and study information about Bualuang K.E. Retail Leasehold Real Estate Investment Trust (“BKER”) before making a decision to invest in the Trust units. This presentation is for information purpose s only and is intended only for the initial direct attendee of the presentation. It may not be reproduced or redistributed to any other person. No part of this presentation, nor the fact of its existence, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. This presentation is not to be relied upon in any manner as legal, tax or any other advice and shall not be used in substitution for the exercise of independent judgment and each person made aware of the information set-forth hereof shall be responsible for conducting its own investigation and analysis of the information contained herein. Except where otherwise indicated, the information provided in this presentation is based on matters as they exist as of the date stated or, if no date is stated, as of the date of preparation and not as of any future date, and the information and opinions contained herein are subject to change without notice. None of the BKER nor any of its subsidiaries accepts any obligation to update or otherwise revise any such information to reflect information that subsequently becomes available or circumstances existing or changes occurring after the date hereof. None of the BKER or any of its subsidiaries or any of their respective directors, officers, employees or agents shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation and any and all such liability is expressly disclaimed. Some statements made in this presentation are forward-looking statements, which are subject to various risks and uncertainties. These include statements with respect to strategies and beliefs and other statement that are not historical facts. These statement can be identified by the use of forward-looking terminology such as “may”, “will”, “expect” , “intend”, “estimate”, “continue”, “plan” or other similar words. The statements are based on the as sumptions and beliefs of BKER management in light of the information currently available to BKER. These assumptions involve risks and uncertainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Nothing in this Presentation is, or should be relied on as promise or representation of BKER as to the future. Page 2
I BKER INTRODUCTION BKER is the Leading and Most Diversified Lifestyle Retail REIT in Thailand, with the first Co-REIT Management between BBL Asset Management (“BBLAM”) and KE REIT Management (“KERM”). 10 Prime Lifestyle Retail Properties CDC The Crystal Ekamai-Ramindra The Crystal SB Ratchapruek 11.3 bn Total Asset Value (THB) Amorini Mall I’m Park Chula Plearnary Mall Sammakorn Place Ratchapruk Sammakorn Place Ramkamhaeng Sammakorn Place Rangsit The Scene Page 3
1 OPERATING HIGHLIGHTS
I KEY UPDATES Management strategic actions since the IPO of BKER: Leasing: Focus on increasing occupancy; leasing to prime brand tenants at each property 1. Cost Reduction: Utilizing economy of scale and efficient management to save costs 2. COVID-19: Resilient neighborhood malls to withstand external impacts 3. Acquisitions: Building pipeline of prime lifestyle retail assets in Thailand and internationally 4. Stronger and Robust Cash Flows for the Long Term Page 5
I KEY HIGHLIGHTS 92.7% +1.3% Traffic Growth 2 Occupancy Rate (%) (Like-for-Like Jan-Feb) +2.9% Rental Reversion 1 (% p.a.) (Rent Growth Per Contract) Remark: 1. Rental Reversion Rate is based on renewal rate or new lease rate of expired NLA for the period 2. Traffic Growth Rate is based on Jan-20 and Feb-20 compared with Jan-19 and Feb-19 for CDC, TC, and TCR Projects Page 6
I BKER GROWTH STRATEGY AND TARGET STRATEGIC AREAS AND INITIATIVES 5Y GROWTH TARGETS Average Per Annum Growth - Active leasing and tenant mix 3-4% Organic Growth - Synergy and cost efficiency - Operational excellence Organic Revenue Growth - High-quality prime acquisitions 4-5% Inorganic Growth - Diversification Organic NOI Growth - YARDI ERP system Operations and Tech Platform - Streamline processes 15-20% - Crystal Rewards platform - Smart capital management Balance Sheet Strength Inorganic TAV Growth - Strong financial structure (Total Asset Value) 4-6% - COVID-19 Portfolio Resilience - Economic slowdown DPU Growth - Risk mitigation (Distribution Per Unit) Page 7
I LEASING STRATEGY OF PRIME BRAND TENANTS EVERY PROPERTY HAS PRIME-BRAND TENANTS IN ALL 4 KEY LEASING FOCUS AREAS Leasing Focus (% of NLA) CDC TC TCR AMR IMP PLN SRM SRS SRP TS Necessity (20%) Supermarket, Banks, Services etc. Health & Wellness (13%) Fitness, Beauty & Health Clinics etc. Food & Hangout (20%) Café, Restaurants, etc. Family & Education (14%) Education, Toys, etc. Page 8
I LEASING UPDATE STRONG LEASING PERFORMANCE AND COMMITMENT OF NEW MAJOR BRANDS Number of Sqm of Renewal Rental For Period Ended 31-Dec-19 Leases Committed Leases Committed Retention Rate 1 Reversion Rate 2 Renewal Leases 53 3,246 sqm 97.2% 2.4% New Leases 15 2,162 sqm - 3.7% Total Portfolio 68 5,408 sqm - 2.9% Remark: 1. Calculated by NLA 2. Calculated on a Per Annum basis Page 9
I HIGH AND IMPROVING OCCUPANCY OCCUPANCY IS HIGH AND EXPECTED TO IMPROVE WITH NEW LEASES COMMITTED Committed 1 as at Share of NLA Actual as at Property New Brands 2020 (% of Total) 31-Dec-19 31-Dec-19 Crystal Design Center 95.6% ▲▲ 25.8% 90.6% Sab Indy, Jas Sofa, Jacquar, SK Home Oh Ka Jhu, Penguin Eat Shabu, The Crystal Ekamai-Ramindra 22.1% 99.3% 99.3% ⎯ Chong Charoen The Crystal SB Ratchapruek 95.7% ▲ 17.5% 93.7% Mos Burger, Sod Aroi, Fresh Me, Tenjo Amorini Mall 86.9% ▼ 96.3% 3.6% Nobicha I’m Park Chula 4.7% 94.3% 94.3% ⎯ n/a Plearnary Mall 8.1% 85.5% 85.7% ⎯ n/a Sammakorn Place Ramkamhaeng 92.1% 90.5% ▼ 7.4% Salad Factory, Fresh Me Sammakorn Place Rangsit 2.4% 92.5% 97.0% ▲▲ Nobicha Sammakorn Place Ratchapruek 79.3% 3.3% 80.5% ▲ Starbucks, A.ta Bubble Tea The Scene Town-in-Town 92.9% ▲ 5.0% 87.3% BBQ Plaza, Masaru Sushi BKER Portfolio 139,539 sqm 92.7% 94.3% ▲ Remark: 1. Committed Occupancy includes Tenants who have signed Offer Letter and/or Quotations with Paid Deposit (Committed Tenants may fill in over the course of up to next 12 months) Page 10
I OPERATION SYNERGY AND COST SAVINGS SYNERGY LEADS TO COST SAVINGS IN OUTSOURCE AND UTILITY EXPENSES Outsource Contracts - 20% - Increased bargaining power with vendors - Headcount reduction by centralizing functions Identified 1 Cost Savings - Synergy and integration with service vendors Utility Expenses - 5% - Changes in operating and monitoring processes - Energy efficiency management Targeted Cost Savings Remark: 1. Identified cost reductions that has been agreed new terms and included in LOI and/or service agreement with vendors Page 11
I LARGE ACQUISITION PIPELINE TOTAL ACQUISITION PIPELINE PIPELINE FACTS Assets in Preliminary Discussions and Valuations No. of Assets Gross Leasable Area Locations 40 Assets 809,000 sqm Bangkok 68%, Provincial 22%, Intl 10% Assets with or near MOU Agreement No. of Assets Gross Leasable Area Locations (FY 2020) 3 Assets 28,000 sqm Bangkok 75%, Provincial 25% Page 12
I ASSET ENHANCEMENT: SOLAR ROOF INITIATIVE SIGNED MOU WITH IMPACT SOLAR TO CONDUCT PILOT PROJECT FOR SOLAR ROOF AT CDC Solar Roof Initiative - 25% - Drive for greater energy efficiency - Sustainability and renewable energy source for mall Cost Reduction Per Unit Rate vs. - Sequestered CO 2 more than 1,300 ton per year Government Rate (kWh) - Plan to roll out across all 10 properties under BKER portfolio Page 13
I ASSET ENHANCEMENT: PLEARNARY MALL REBRANDING NEW MODERN LOOK FOR PLEARNARY MALL AHEAD OF ASSET REPOSITIONING Plearnary Mall Rebranding - Appeal to growing customer target group of working people Higher traffic and increase and new families dwell time of customers - First phase of repositioning ahead of tenant rezoning for banking, fashion, and big box tenant zones Page 14
I LIMITED IMPACT FROM COVID-19 AS SHORT-TERM RISK BKER HAS GOOD RISK MITIGATIONS FOR COVID-19 OUTBREAK Traffic Resilience Essential Tenants Open Rental Discounts So far customers choose to visit Supermarket, pharmacies, banks, Use Thai Shopping Center neighborhood malls instead of office, and F&B delivery tenants are Association Policy (TSCA) of enclosed malls to avoid virus critical shops that stay open best-effort measure for tenants during shutdown period +1.3% 30% Other period discount is considered on case-by-case Like-for-Like Traffic Growth Of Tenant Mix Still Open basis for each tenant (Jan-Feb 2020) (%) Page 15
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