Value Creation - Investor Relations
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5th annual report FY2006/07 Value Creation
Ascendas Real Estate Investment Trust
Ascendas Real Estate Investment Trust (“A-REIT”) is Ascendas-MGM Funds Management Limited (“A-MGM)
the first and largest business space and industrial Real is the manager of A-REIT (the “Manager”).
Estate Investment Trust (“REIT”) listed on Singapore
The Manager is committed to delivering long-term
Exchange Securities Trading Limited (“SGX-ST”).
sustainable distributions and capital stability to
A-REIT owns a diversified portfolio of properties in Unitholders through a three-pronged strategy
Singapore comprising:
Value-adding investments comprising yield
Business & Science Parks accretive acquisitions of properties with
Suburban office, R&D space, business HQ buildings. strong underlying real estate fundamentals
and development projects
Hi-Tech Industrial
High office content combined with high Organic portfolio growth through proactive asset
specifications industrial space. management
Light Industrial / Flatted Factories Optimising capital structure
Low office content combined with
manufacturing space.
Logistics & Distribution Centres Total
Returns
Warehousing and distribution centres. Predictable Income Capital Stability
Warehouse Retail Facilities Outcome
Single-user retail and warehouse space. Stability Growth
These properties house a tenant base of more than 750
international and local companies from a wide range of Strategies Optimised Captial Proactive Asset Value-Adding
Structure Management Investments
industries and activities, including research and development,
• Equity funding • Portfolio • Yield accretive
life sciences, information technology, engineering, light positioning and acquisitions
• Debt funding strategies
manufacturing, logistics service providers, electronics, • Built-to-Suit
telecommunications, manufacturing services and back-room • Interest rate risk • Supervise projects
management execution
office support in service industries. • Cost of capital
of asset • Development
management
Contents
02 Financial Highlights 34 Light Industrial Properties
04 Chairman’s Statement 40 Logistics & Distribution Centres
07 Manager’s Report 44 Warehouse Retail Facilities
14 Board of Directors 45 CBRE Market Study
16 Significant Events 49 Corporate Governance
18 The A-REIT Team 57 Investor Relations
22 A-REIT Structure 58 Financial Statements
23 The Property Manager 92 Unitholder Statistics
24 Investment Property Portfolio 94 Additional Information
26 Business & Science Park Properties 96 Glossary
30 Hi-Tech Industrial Properties
VALUE CREATION
At A-REIT, we are strongly committed to excellence in all
our pursuits as we make a difference for our clients and
our unitholders. We achieve this by leveraging the talent
and passion of our people to continuously seek ways to do
things better.
Combined with our trusted brand, an expanding portfolio
and a strong customer focus, we will strive to continuously
create value and deliver sustainable long-term returns
to our stakeholders.
A-REIT’s MISSION
To deliver predictable and sustainable distributions and
achieve long-term capital stability for unitholders.
Financial Highlights
FY2006/07 FY2005/06 FY2004/05 FY2003/04 FY2002/03
Net Income ($m) 148.4 132.0 75.5 40.6 14.3
Net Income available for distribution ($m) 163.8 142.6 84.2 45.5 15.2
Earnings per Unit (”EPU”) (cents) 11.55 10.81 8.66 7.27 7.19(1)
Distribution per Unit (“DPU”) (cents) 12.75 11.68 9.56 8.16 7.63(1)
Note:
(1) Annualised based on actual EPU of 2.62 and DPU of 2.78 cents for the 133 days ended 31 Mar 03.
As at As at As at As at As at
31 Mar 07 31 Mar 06 31 Mar 05 31 Mar 04 31 Mar 03
Number of properties in portfolio 77 64 36 16 8
Total assets ($m) 3,307.0 2,807.5 2,114.4 1,020.7 636.4
Total net borrowings ($m) 1,183.5 969.8 556.0 263.8 125.0
Total Unitholders’ funds ($m) 1,970.0 1,708.4 1,425.5 691.7 498.2
Market capitalisation ($m)(1) 3,164.8 2,771.5 2,181.8 898.2 444.2
Total net borrowings to total assets 35.8% 34.5% 26.3% 25.8% 19.6%
Net asset value per Unit ($)(2) 1.49 1.34 1.23 0.98 0.91
Aggregate leverage(3) 37.3% 36.7% 30.2% 28.9% 19.6%
Unit price ($) 2.39 2.17 1.88 1.27 0.815
Number of Units in issue (m) 1,321.6 1,277.2 1,160.6 702.2 545.0
Notes:
(1) Based on respective closing prices on 31 Mar.
(2) Before adjustment for distributable income not yet distributed.
(3) Includes total borrowings and deferred payments on acquisition of properties.
Trading Performance since IPO
3.00 800
Month End Closing Unit Price (S$)
700
2.50
600
2.00
500
Million units
1.50 400
300
1.00
200
0.50 100
0.00 0
PO) 2/03 3/04 4/05 5/06 r-0
6 6
y-0 Jun-0
6 -06 -06 -06 t-0
6
v-0
6 6
c-0 Jan-0
7 -07 r-0
7
2 (I Y0 Y0 Y0 Y0 Ap Ma Jul Au
g Sep Oc No De Feb Ma
v-0 F F F F
No
Ascendas real estate investment trust
annual report FY2006/2007
Yield returns compared to Singapore 10-year bond and S-REITs(1)
10% 8.7 Yield 10-year Government bond yield(2) Weighted average S-REITs’ yield
8%
582 bps
6% spread 5.3
243 bps
spread
4%
2.9 2.9 -92 bps 2.9
spread
2%
2.0
S-REIT High A-REIT S-REIT Low
Notes: (1) Based on S-REITs’ closing price as at 31 Mar 2007
(2) As at 31 Mar 2007. Source: Singapore Government Securities website
Comparable Returns
A-REIT annualised yield for IPO investors (1) 14.5% Notes:
(1) Based on A-REIT’s IPO price of $0.88 per unit and
DPU of 12.75 cents for FY06/07.
A-REIT annualised yield as at 31 Mar 07 (2) 5.3%
(2) Based on A-REIT’s closing price of $2.39 per unit on
31 Mar 07 and DPU of 12.75 cents for FY06/07.
ST Index (3) 3.1%
(3) Based on Bloomberg data as at 31 Mar 07.
10 year Government bond (4) 2.9% (4) As at 31 Mar 07.
Source: Singapore Government Securities website
(5) Interbank overnight interest rate as at 31 Mar 07.
Interbank overnight interest rate (5) 2.5% Source: Bloomberg
(6) Based on interest paid on Central Provident Fund
CPF (ordinary) account (6) 2.5% (“CPF”) ordinary account from 1 Jan to 31 Mar 07.
Source: CPF website
Bank fixed deposit (12 months) (7) 0.9% (7) Bank fixed deposit rate (12 months) as at 31 Mar 07.
Source: Monetary Authority of Singapore website
Bank savings deposits (7)
0.3%
Regular and Stable Distributions
Distribution Per Unit (cents)
FY02/03 7.63 cents(1)
FY03/04 8.16 cents (+7%)
FY04/05 9.56 cents (+17%)
FY05/06 11.68 cents (+22%)
FY06/07 12.75 cents (+9%)
Note: (1) Annualised based on actual DPU of 2.78 cents for the 133 days ended 31 Mar 03
Trading Statistics for FY06/07
Opening Price (3 Apr 06) $2.17 Volume Traded (million units) 942.9
Closing Price (31 Mar 07) $2.39 Percentage of SGX S-REIT volume (%) 12.2
High (19 Jan 07) $2.75
Low (28 Jun 06) $1.82
Ascendas real estate investment trust
annual report FY2006/2007
Chairman’s Message
On behalf of the Board, it gives me great pleasure to Enhancing A-REIT’s financial position
present A-REIT’s fifth annual report for the financial year Through an active capital management strategy, we continue
ended 31 March 2007. to optimize A-REIT’s capital structure. As at May 2007, A-REIT
I am pleased to report another successful year in which the has 95% of its interest rate exposure fixed for a weighted
strategies pursued by the Manager have delivered stable average term of 4.5 years at a weighted average cost of
and predictable distributions and achieved long term capital borrowing of 3.4%. We expect the positive results of our
stability for A-REIT’s unitholders. active asset management and widened investment strategies
to continue to underpin the steady performance expected
A-REIT’s distribution per unit (DPU) increased by 9.2% to from A-REIT’s portfolio.
12.75 cents as compared to 11.68 cents in the previous
financial year. The portfolio grew to 77 properties versus 64 Looking Ahead
properties last year, and total assets were $3.3 billion as at
31 March 2007, an increase of about 18%. Given the positive outlook for the economy, the
manufacturing sector and the industrial property sector,
FY06/07 was challenging with increased competition for the Manager expects to be able to deliver total returns that
both physical assets in the property market and funds in are in line with the performance of established REITs in
the capital markets. Nonetheless, A-REIT has delivered an mature markets.
impressive set of results by focusing on its core competencies
and successfully implementing a three pronged strategy of Building on our position as the leader in business space
disciplined and value-adding investments, proactive asset and industrial properties, we will continue to maintain a
management and prudent capital management. disciplined investment strategy to continue to offer stable
and predictable distributions through a portfolio
of diversified tenants from a broad mix of industries.
Strengthening A-REIT’s valued portfolio
During the year, the Manager was successful in increasing Unitholder’s Meeting
the overall occupancy rate of A-REIT’s portfolio to 96.6%
from 95.0% a year ago. There was also positive rental There have been numerous opportunities for the Board to
reversions across all sub-sectors within the portfolio as a meet with Unitholders over the past few years due to the
result of active asset management and a recovering frequency of Extraordinary General Meetings of Unitholders.
industrial property market. However, in the last year, this has not been the case.
Therefore, the Board has decided to hold a Unitholder’s
As part of A-REIT’s proactive asset management program, Meeting for A-REIT on 28 June 2007 at 3pm. Together with
we have undertaken asset enhancement projects at the this annual report is a Notice of Meeting and accompanying
Alpha and Telepark. The additional areas created in both circular which sets out details of the resolutions that will
buildings have been fully committed, resulting in increased be put to Unitholders for approval. Management seeks the
income. support of all Unitholders for these initiatives in the interest
of continuing the success and growth of A-REIT.
The past year saw the Manager broadening A-REIT’s
investment strategy to include development activities as
this provides potential for greater returns to investors as In Appreciation
development profits are enjoyed by A-REIT rather than A-REIT’s success would not have been made possible
by third party developers from whom such properties are without the concerted effort of many parties. Firstly, I
acquired. This can be seen from the completion of A-REIT’s would like to thank my fellow Board members for their
first development projects during the financial year - two invaluable advice and contributions throughout the last
separate built-to-suit warehouse retail facilities which were year. I would also like to express my gratitude to our tenants
completed on schedule and within budgeted cost. A-REIT and business partners for their unwavering support. I also
recorded an unrealized capital gain of $24.3 million on would like to extend my appreciation to the A-REIT team for
these projects. their dedication in pursuing the growth strategies that the
Manager has set out. Last but not least, I would like to thank
In addition, A-REIT commenced a partial build-to-suit you, our Unitholders, for your trust and confidence in us.
business park development, HansaPoint @ Changi Business
Park and a Logistic & Distribution Centre development in With continued focus on our core strategies, I am confident
Changi North. In the financial year, A-REIT committed to 17 that we will continue to deliver another year of stable and
acquisitions and development projects worth $488 million, growing returns.
of which $148 million worth are pending completion.
We will continue to pursue quality and sustainable yield
accretive acquisitions and, at the same time, pursue
development opportunities for enhanced returns.
Lew Syn Pau
Chairman
8 June 2007
主席致词
我 谨代 表董 事会，借此 机会公布A- REIT 截 至 我们将继续寻求高品质、回报持久、增值型的收
2007年3月31日财政年度的第5年年度报告。 购项目。与此同时，我们也谋求回报更好的开发
机会。
我很高兴地宣布这又是成功的一年，管理层制订
并实施了正确的策略，实现稳步且符合预期的收 增强 A-REIT的财务地位
益分派，维持资本长期的稳定，向A-REIT单位信 通 过 积 极 的 资 金 管 理 策 略 ，我 们 不 断 优 化
托股东交出了不俗的业绩。 A-REIT的资金结构。截止2007年5月，A-REIT
95% 的利息率一般固定在加权平均年限4.5年，
A-REIT单位收益分派(DPU)与上一财政年度的
加权平均贷款成本3.4%。我们希望通过积极资
11.68分相比增长了9.2%，达到12.75分。投资组
产管理，拓宽投资策略，从而使A-REIT投资组
合中的房产数目从去年的64栋增加到77栋，截
合取得稳定表现和预期收益，获得更积极的成
至2007年3月31日，总资产达到33亿元，增长率
效。
约为18%。
基于经济、制造业和工业地产的乐观前景，管理
FY06/07充满了挑战，房地产和资本市场上所面
层预计能够取得REIT在成熟市场上应得的总回
对的竞争愈发激烈。因此，A-REIT充分发挥自
报率。
己的核心实力，成功采用了“三管齐下”的策略，
即，有节制的增值投资、积极的资产管理和审慎 我们将立足于成为商务空间和工业房产的领导
的资金管理，从而取得了令人叹服的业绩。 者，继续执行慎重的投资策略，通过多元化的租
户及其多样化的工业背景，为投资组合寻求稳定
增强A-REIT的投资组合价值
的、可预期的派息收益。
在这一年中，管理层成功地将A-REIT投资组合
中的出租率从一年前地95.0%提高到96.6%。同 单位信托持有者大会
时，由于实施了积极的资产管理策略和房地产市 在过去几年中，我们频繁举办单位信 托持有者
场的逐步复苏，投资组合的房产租金也出现回升 特别大会，让董事会与单位信 托持有者有更多
的趋势。 见面的机会。但是，去年的情况与往常不同。因
此，董事会决定在2007年6月28日下午3点举行
作为A-REIT积极型资产管理计划之一，我们在
A-REIT单位信托持有者大会。这份年度报告附
The Alpha和Telepark推出资产价值提升计划。
带了该次会 议 通知，以及需要单位信托股东批
这两座大厦新增的面积已经成功找到用户，从
准的详尽解决方案。管理层希望单位信托股东
而增加了投资收益。
支持这些动议，以便A-REIT取得更大的成功和
在 过去 一 年 中，管 理 层 扩展了A- R EIT 的 投 资 持续的增长。
策 略，推 行了物业 开发 的业 务。这 为投资 者 带
答谢
来了更高的回报，因为物业开发的收 益完全归
A-REIT，而不是被第三方发展商（卖方）享有。 如果没有各方的协调努力，A-REIT无法取得今
这体现在A-REIT本财政年度第一个项目 --- 两 天的成功。首先，我要感谢董事会同仁，感谢他
项单独的build-to-suit（承接设计与建筑施工） 们在去年全年中提出的各种宝贵建议和做出的
仓库零售设施 准时完工，成本符合预算要求。 贡献。我也感谢租户和商务伙伴，感谢他们坚定
A-REIT在这些项目上取得的暂未实现的资本收 的支持。我也向A-REIT团队致敬，感谢他们全力
益高达2千4百30万元。 支持管理层制定的增长策略。最后，我也要感谢
广大的单位信托股东，感谢您对我们的信任。
此 外，A- REIT 已着手 一项 局 部 的build -to－
suit（承接设计与建筑施工）商务园区开发项目 我相信只要坚持不懈地执行核心策略，我们将再
HansaPoint @ Changi Business Park，以及樟 次迎来稳定增长、回报丰厚的一年。
宜北物流及分销中心。在该财政年度，A-REIT进
行了17项收购及开发项目，总价值达4亿8千8百 刘信保 敬上
万元，其中1亿4千8百万项目接近完工阶段。 主席
2007 年 6 月 8 日
Ascendas real estate investment trust
annual report FY2006/2007
Manager’s Report
Highlights
The highlights of FY 06/07 are : Recorded net income available for
distribution of $163.8 million, a 14.9%
increase year-on-year (y-o-y)
Achieved DPU of 12.75 cents, a 9.2%
increase y-o-y
Two valuations were conducted in FY06/07,
in June 2006 and March 2007, resulting in
a total unrealized capital gains of $188.7
million. Net asset value increased by 11.2%
to $1.49 per unit
Improved overall portfolio occupancy
to 96.6% versus 95.0% at 31 March 2006;
Occupancy for multi-tenanted buildings
improved to 93.7% from 91.4%
Completed first two development projects
on schedule and within budgeted
development cost
Committed $488 million worth of
investments in acquisitions of income
producing properties and development
projects of which $148 million is pending
completion
Total assets increased from $2.8 billion to
$3.3 billion
Manager’s Report
A-REIT delivered yet another set of solid results in FY06/07 Value Creation: Development
as Ascendas-MGM Funds Management (“the Manager”) A-REIT’s development of two separate warehouse retail
successfully pursued its three-pronged strategies to create facilities for Courts (Singapore) Ltd and Cold Storage
value for A-REIT’s unitholders. Singapore (1983) Pte Ltd were successfully completed
on schedule and within budget in December 2006 and
A-REIT’s net income available for distribution of $163.8 February 2007 respectively. These two properties are the
million is an increase of 14.9% compared to $142.6 million in first warehouse retail properties developed under the
the previous financial year. Distribution per unit (“DPU”) of Warehouse Retail Scheme (“WRS”) and house the respective
12.75 cents is 9.2% higher than the previous financial year. users’ regional headquarters, retail, warehousing and
Based on the closing price of $2.39 on 31 March 2007, the industrial activities under one roof. The two WRS properties
DPU represents a distribution yield of 5.3% which is 243 basis were revalued in the recent valuation exercise, recording
points above the 10-year government bond benchmark yield an aggregated unrealized capital gains of $24.3 million (or
of 2.9%. A unitholder who held A-REIT units from 1 April 2006 about 20%) above the combined total development cost of
would have enjoyed a capital appreciation of 10.1% and total the two projects. This demonstrates the value to unitholders
returns for the year of 16.0%. in undertaking developments using A-REIT’s balance sheet.
The two WRS projects also demonstrate A-REIT’s commitment
A-REIT has continued to add significant scale and value to to pursue attractive earnings accretive opportunities while
the portfolio through disciplined and quality acquisitions maintaining a disciplined approach to ensure that risks are
and developments. A-REIT’s portfolio of 77 properties mitigated.
now houses a tenant base of more than 750 international
and local companies from a wide range of industries and A-REIT has undertaken two other development projects,
activities, including research and development, life sciences, which have commenced construction and are expected to be
information technology, engineering, light manufacturing, completed within the first half of 2008:
logistics service providers, electronics, telecommunications,
manufacturing services and back-room office support in Hansa Point @ CBP
service industries.
This is a partial build-to-suit business park property located
in Changi Business Park. The estimated site area is 7,779
Our three-pronged strategies emphasize stable and
sqm with expected gross floor area of the development at
predictable income and long term capital stability. Through
approximately 19,448 sqm. The level of pre-commitment
proactive asset management, value-adding investments and
for space in this property has increased from 28% at the
optimization of capital structure, we achieve stability, growth
inception of the project to 42% within 6 months due to the
and sustainability in our business. The talent and passion
relatively strong demand conditions for this type of property.
of our people enable us to to grow our business, adding
depth and diversity to our portfolio of quality property and
maximizing returns for our unitholders.
Plot 7 & 8 Changi LogisPark (North)
This is a partial build-to-suit distribution facility with 80%
Value Creation: Capital Gains pre-commitment for the space by Zuellig Pharma Pte Ltd (ZP)
as the anchor tenant. The estimated site area is 20,100 sqm.
Independent valuations carried out in June 2006 and
The expected gross floor area of the facility is 31,562 sqm. ZP
March 2007 on the portfolio resulted in an increase of
is an existing tenant whose needs have outgrown its current
$188.7 million over the book value of these properties as at
location. This presents us with the opportunity to create a
1 April 2006. This is a result of the Manager’s proactive asset
new, modern and high specification distribution centre to
management strategies which led to occupancy and rental
meet the needs of the market.
rates improvements across the portfolio.
Value Creation: Yield Accretive Acquisitions Value Creation: Portfolio Diversification
Well Located Quality Properties
In addition, disciplined acquisitions and development of
high-quality properties continue to be a focal point of our A-REIT owns a well-diversified portfolio of quality properties
business. In the latest financial year, we have committed spread across six sub-sectors to meet the real estate needs of
and completed a total of 17 acquisitions and development its customers. The sub-sectors comprise Business and Science
projects worth $488 million, of which four projects worth Parks properties (20%), Hi-Tech Industrial properties (25%),
about $148 million are pending completion. This increases Light Industrial properties (16%), Flatted Factory space (8%),
our total assets from $2.8 billion to $3.3 billion as at Logistics and Distribution centres (27%) as well as Warehouse
31 March 2007. The majority of these transactions were Retail Facilities (4%).
sale-and-leaseback transactions which provide stable returns
through long term leases on pre-agreed terms. These sub-sectors are exposed to different segments of the
economy and have different growth drivers thereby providing
diversification value to the portfolio.Ascendas real estate investment trust
annual report FY2006/2007
8.0%
Warehouse 8.0%
Top 10 tenants in A-REIT’s portfolio
Retail Facilities 7.0%
Business 4% 6.2%
6.0%
& Science Park Logistics & Distribution
20% Centres 5.0%
27%
4.0%
3.0% 2.7% 2.6% 2.6%
2.4% 2.3%
2.0% 1.9%
Asset class 2.0% 1.7%
diversification by 1.0%
Portfolio Value
0.0%
el P
en
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ie
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gT C& ag og t Li Ltd te L
Hi-Tech Si
n em t or tio a c C o l
Si S r n a P n o g h te l l P
Industrial Flatted Factories ld te tt ch Frei rk P we
25% 8% Co In le Te a ey
T e w n i p
T r n
H eo ist Ho
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Light Industrial pr
16% Ex
Well Balanced Lease Tenure with Built-in Growth A-REIT has a diverse mix of tenants from various industries
The mix of sale-and-leaseback properties with long term such as manufacturing & engineering, healthcare, logistics
leases and multi-tenanted properties with short term as well as IT and related activities. Diversity in the tenant-
leases provide A-REIT with a balance of stability and growth mix is also evident with a range of local and multinational
opportunities. companies from many different countries.
Sale-&-leaseback long term leases usually have annual The weighted average lease to expiry for A-REIT’s portfolio
stepped rental increases which provide stable growth for remains stable at 6.8 years, compared to 6.7 years as at
the portfolio while the short term leases in multi-tenanted 31 March 2006. The weighted average lease to expiry of
properties could enjoy potential positive rental reversions in A-REIT’s land leases is 51.3 years (excluding freehold
the upswing cycle of the property market. properties).
A-REIT’s earnings are strongly underpinned by the diversified
property portfolio and tenant base thereby achieving our
goal of providing a steady and predictable income stream to
Sale-&-Leaseback our unitholders.
49%
Value Creation: Proactive Asset Management
Mix of Lease Type
as at 31 March 2007 Organic Growth through Asset Enhancement
Our asset management team is constantly exploring
opportunities to enhance the value of our portfolio. We have
recently embarked on two asset enhancement initiatives to
Multi-tenanted enhance value in our existing properties.
Buildings
51%
Additional space was created at Telepark Building to
maximize its allowable plot ratio. This additional space has
Well Diversified Tenant Base been fully tenanted, resulting in a 0.3% increase in the yield
A-REIT’s portfolio is well diversified across property type of this property, which is worth $191 million.
and customer base. As at 31 March 2007, the top 10 tenants
accounted for 32.4% of total gross rental income compared to In response to a pre-commitment by a leading Singapore
33.9% a year earlier. By diversifying A-REIT’s portfolio, listed company relocating from the Orchard Road area, we
it minimizes reliance on any one property. No single property took the opportunity to maximize the plot ratio of The Alpha
accounts for more than 6% of gross revenue, compared to 7% at Singapore Science Park 2 by constructing an additional
a year ago. floor of 3,527 sqm. The construction is expected to be
completed in the third quarter of FY07/08 and will result in a
0.5% increase in the yield of this property, which is worth
$56 million.10
Manager’s Report
20% Weighted Average Lease to Expiry
15.7%
64 Properties @ 31 Mar 06 77 Properties @ 31 Mar 07
13.4%
13.1%
% of A-REIT Property Income
12.2%
11.8%
11.0%
10.7%
9.1%
8.4%
8.4%
8.3%
8.0%
10%
7.9%
7.6%
6.6%
6.4%
6.4%
5.8%
5.7%
3.2%
2.5%
2.4%
2.2%
2.1%
2.2%
2.0%
1.8%
1.6%
1.2%
1.2%
1.1%
0.0%
0%
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 02
1
20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 >2
YEAR ENDING 31 MARCH
These asset enhancement initiatives are testaments to our As a result, A-REIT’s portfolio occupancy rate increased to
proactive asset management strategy whereby we continue 96.6% as compared to 95.0% a year ago. The occupancy rate
to find ways to enhance our existing portfolio to deliver for multi-tenanted buildings also increased from 91.4% to
organic growth to our unitholders. 93.7%.
Organic Growth through Positive Rental Reversions With proactive asset management initiatives and the refining
Significant rental reversions were achieved in the suburban of our customer care programme, 92.5% of our tenants
property sectors (Business & Science Parks and Hi-Tech renewed their leases that were expiring in the financial year.
Industrial) in tandem with the recovering market conditions.
Based on the renewed leases signed, the rental reversion Properties with significant
rates for our Business & Science Park and Hi-Tech Industrial improvement in occupancy rates:
properties increased by 13.1% and 18.5% respectively
Occupancy as Occupancy as
in FY06/07. The only weakness was in the Logistics & Multi-tenanted Buildings
at 31 Mar 07 at 31 Mar 06
Distribution Centres sector where significant new supply has
The Alpha 91.5% 82.4%
dampened the rental outlook in the short term especially for
lower grade properties in the sector. The Gemini 79.0% 67.5%
KA Place 79.6% 57.4%
Organic Growth through Active Leasing
KA Centre 95.9% 74.5%
With increasing demand and proactive marketing and leasing
Techlink 94.8% 86.8%
activities, the Manager successfully leased over 209,400 sqm
of space (including renewals) in the year, representing 13.7% 1 Jalan Kilang 100.0% 92.2%
of the net lettable area of A-REIT’s portfolio. Techview 91.2% 85.4%
Techplace I 92.4% 96.1%
Organic Growth through Positive Rental Reversions
Multi-tenated Occupancy @ Occupancy @ Increase in Increase in new
Properties 31 Mar 06 31 Mar 07 renewal rates* take up rates^
Business & Science Park 89.5% 92.8% 13.1% 23.3%
Hi-Tech Industrial 90.8% 95.5% 18.5% 11.8%
Flatted Factories 89.6% 94.5% 4.3% 4.3%
Light Industrial 95.2% 97.1% 2.5% 5.2%
Logistics & Distribution Centres 92.5% 90.4% 3.1% -2.6%
Total Portfolio (MTB) 91.4% 93.7%
* growth in renewal rental rates compared to previous contract rates
^ growth in new takeup rates in FY06/07 compared to new takeup rates in FY05/06Ascendas real estate investment trust
annual report FY2006/2007 11
The occupancy rates for our four main asset classes exceeded Value Creation: Prudent Capital Management
the Urban Redevelopment Authority’s island-wide occupancy
The Manager continues to actively and prudently manage its
rates by 4.3% to 12.1%.
capital structure. Aggregate leverage (as defined by Monetary
Authority of Singapore) remained stable at 37.3%.
Occupancy Rate versus Industry Average
98.0%
A-REIT took advantage of cheaper bank debt facilities to fund
100.0% 96.9% 97.0%
its acquisition activities and development projects. Some
95.0%
90.1%
outstanding debt was refinanced with the proceeds of new
88.7%
90.0%
85.8% 85.9% 85.9%
equity raised in February 2007. The private placement of
85.0% 40,323,000 units at $2.48 per unit raised $100 million.
Occupancy Rate (%)
80.0%
75.0%
Another $395 million of outstanding debt was refinanced
in May 2007 through a third issue of seven-year tenure
70.0%
commercial mortgage-backed securities.
65.0%
60.0% The Manager aims to maintain A-REIT’s gearing at an optimal
55.0% level of around 45%. Based on the current aggregate leverage
50.0% of 37.3%, a further $450 million of debt capacity is available
Business &
Science Park
Light Industrial Hi-Tech Industrial Logistics for near term investment activities.
A-REIT Industry Average
We will continue to adopt a prudent stance on interest rate
risk management. As at May 2007, 95% of total debt has been
Occupancy in the suburban properties and high fixed for an average 4.5 years at an average interest rate of
specifications industrial space is expected to continue to 3.4% (including all bank margins and costs).
increase due to the present tight office supply and rising
office rentals in the central business district as back-room Value Creation: A-REIT’s Competitive Edge
office users seek better value propositions.
We continue to build upon our strengths to create a
competitive edge to differentiate ourselves, to facilitate
The Manager is pleased to report that it has successfully
growth and enhance sustainability and stability in our
leased out 9,593 sqm of space at 30 Tampines Industrial
portfolio.
Avenue 3 (formerly NESS building). The previous tenant
went into liquidation late last year, and the Manager has
Diversity and Depth
been actively working with the liquidator to both maximize
the returns from the sale of the equipment and to market A-REIT is the largest business and industrial REIT in Singapore
the space to prospective tenants. We are pleased to report with six property asset classes of well-located, quality
that all of the vacated space has been leased to MBE properties in a solid and well-diversified portfolio. There is
Technology Pte Ltd for a period of 15 years starting from a good balance of long-term and short-term leases which
1 July 2007. provides stability and potential for rental growth.
MBE Technology Pte Ltd currently occupies space in one of Market Leader
Ascendas Group’s buildings. This is an example of the ability A-REIT is the established market leader in most of the sectors
to leverage off the property manager’s market position that it operates in:
and harness on the Manager’s expertise in proactive asset
38% share of the Hi-Tech Industrial space in Singapore
management for the benefit of our portfolio.
29% of Business & Science Park space in Singapore
Expense Management 11% of Logistics & Distribution space in Singapore
We continue to review our operations with our service • 30% in the eastern region
partner, Ascendas Services Pte Ltd (“ASPL”), to ensure cost • 13% in the western region
efficiencies and economies of scale for the management of
our properties. Over the past, we have explored the options Our exposure to the Light Industrial and Flatted Factories
of using energy efficient lightings to reduce utilities cost, space in Singapore is relatively small at 2.1%.
streamlining the deployment of site staff to take advantage
of geographical clustering of our property portfolio and We are focused on the business space and industrial property
reviewing operating processes to achieve consistency in the sector with committed sponsors. Ascendas Group has a track
services we provide to our customers. record of more than 20 years in the sector.12
Manager’s Report
Operational Platform A-REIT’s portfolio of high-end business space is well
We have a dedicated sales/marketing, leasing and property positioned to serve the needs of the future industries in
management team of over 80 people to service the needs of Singapore.
our customers.
Market Outlook
Customer Focus Looking ahead, demand for high end quality business
We have a track record of customers growing with us with a space (i.e. Business & Science Parks and Hi-Tech Industrial) is
high customer retention ratio of 92.5%. expected to remain buoyant due to the continued business
expansion and new investments in a wide range of industrial
Size Advantage sectors. The extremely tight central business district office
supply could continue to push up office rentals. This in turn
A-REIT accounted for 12% of the S-REIT market capitalisation
could create some spinoff demand for quality business
and 8% of Asian REIT ex-Japan market capitalisation. In 2006,
space in suburban locations as companies seek better value
it accounted for about 12% of the trading volume for S-REIT
propositions to relocate their back-end offices.
on the SGX-ST in 2006. A-REIT was ranked 6th in the Business
Times Transparency Index amongst all companies listed on
A-REIT expects good performance from the Business &
the SGX-ST which demonstrates A-REIT’s commitment to
Science Parks as well as Hi-Tech Industrial sectors due to
transparency and good corporate governance.
limited new supply in the next two to three years and
sustainable stronger rental growth.
Moving Forward
The Singapore economy is expected to grow at a healthy rate We expect a stable outlook for light industrial properties
of about 5 to 7% in 2007. With the successful restructuring of and flatted factories due to the relatively high vacancy rates.
the Singapore economy over the last few years, there are now The short term outlook for the Logistics & Distribution Centre
more growth engines such as tourism and services in addition sector is subdued due to the large expected planned new
to the manufacturing sector powering the growth of the supply of about 922,000 sqm of space from 2007 to 2009 of
Singapore economy. which 542,000 sqm is under construction.
In the manufacturing sector, the over-reliance on electronics Future Growth Drivers
is now diversified with growing importance of the bio-
Potential Positive Rental Reversion
pharmaceutical, aeronautical, IT & media and many other
segments. The Singapore economy will continue its march As of 31 March 2007, 57% or 103,422 sqm of leases which are
up the value chain with increasing focus on more capital due for renewal in FY 07/08 are deemed to be under-rented.
and knowledge intensive businesses as the traditional low A-REIT expects positive rental reversions from these leases as
value-adding and labour intensive activities are no longer the existing rents are about 6% to 25% below the market.
competitive.
Continued Organic Growth Potential
40,000 $3.00
35,000 $2.54
Area due for renewal which is
$2.50
Average rents ($psf pm)
30,000
$2.10
under rented (sqm)
$2.00
25,000 $2.04
20,000 $1.74 $1.50
$1.25 $1.35
15,000 $1.00 $1.00
$1.18 $1.16
10,000 $0.90
$0.50
5,000
0 $0.00
Business & Hi-tech Flatted Light Logistics &
Science Park Industrial Factories Industrial Distribution Centres
Area that is underrented Avg. existing rates of underrented revenue Market RentalAscendas real estate investment trust
annual report FY2006/2007 13
Lease Type by Sector
90.0% 82.8%
80.0% 73.9%
68.6%
70.0% 64.6%
60.0%
50.0%
40.0% 35.4%
31.4%
30.0% 26.1%
17.2%
20.0%
10.0%
0.0%
Business & Hi-Tech Logistics & Light
Science Park Industrial Distribution Centres Industrial
Short-term lease Long-term lease
The majority of the leases in the high growth sectors of Development
Business & Science Parks as well as High-Tech Industrial With asset price inflation, we will continue to put more
properties are on a short term basis. More than two-thirds emphasis into achieving better returns per unit investment
of the Logistic & Distribution sector and the Light Industrial dollar through the creation of assets by utilizing our
sector are long term leases. development capability and capacity.
Occupancy improvements Conclusion
Strong market conditions are expected to continue to If the Singapore economy continues to perform well,
improve the multi-tenanted occupancy rate from the current we believe that the strategies we have developed over the
level of 93.7%. years will put us in good stead to offer continued stable and
predictable distributions through our portfolio of diversified
Asset Enhancement opportunities tenants from a broad mix of industries.
We will continue to look for opportunities to enhance assets
within the portfolio. We could expect some expansion A-REIT will continue to build on its position as the leader
of existing buildings to meet the growth requirements of in the business space and industrial property market in
existing tenants as well as exploiting potential to maximize Singapore by maintaining a disciplined investment approach
plot ratio if market demand is assessed to be conducive. and proactive asset management to enhance our property
portfolio and create value for our unitholders.
Investment – acquisitions
While capitalisation rates for income producing properties Unitholders can be assured of A-REIT’s continuing efforts to
have compressed to the 6% – 7% range, selective and achieve long-term capital stability through proactive and
disciplined acquisitions could still be significantly yield professional asset management of the portfolio with total
accretive given debt costs of less then 3.5%. returns in line with established REITs in more mature markets.
We will continue to focus on choice properties which are
versatile in their use and can offer sustainable long term
returns.14
01 02 03 05 06 07
04 08 09
Board of Directors
01 | Mr Lew Syn Pau 03 | Mr David Wong Cheong Fook
Chairman Independent Director
Mr Lew has extensive corporate and banking experience in Mr Wong is a director on the boards of Oversea-Chinese
the public and private sectors. He was the General Manager Banking Corporation Ltd, Pan-United Marine Ltd, LMA
and Senior Country Officer of Banque Indosuez, Singapore International NV, Banking Computer Services Pte Ltd, BCS
branch. He is now the Chairman of international executive Information Services Pte Ltd, Jurong International Holdings
search consultancy, Stanbridge International Pte Ltd, and Pte Ltd, OCBC Bank (Malaysia) Bhd and Bank of Singapore Ltd.
Director of financial consulting and corporate search firm, He is also on the board of the National Environment Agency.
Capital Connections Pte Ltd. He is also the Honorary President
of the Singapore Manufacturers’ Federation, and sits on the
boards of numerous listed companies. Previously, Mr Lew 04 | Dr Peter Dodd
was a Member of Parliament (1988 – 2001) and the Chairman Independent Director
of the Government Parliamentary Committee for National
Development (1997-2000) Dr Dodd has over 21 years experience in investment
banking. Most recently, he was Managing Director and
Global Head of Corporate Finance for ABN AMRO in London.
02 | Mr Gregory Goodman He was previously the Dean and Managing Director of the
Deputy Chairman Australian Graduate School of Management, the business
school for both the University of New South Wales and the
Mr Gregory Goodman is the Group Chief Executive Officer University of Sydney. Dr Dodd is currently the Chairman
of Macquarie Goodman Group and is responsible for its of TransGrid the NSW Electricity Transmission operator, a
global operations. He has 24 years of experience in the Director and Chairman of the Audit Committee of the ASX-
property industry with significant expertise in the industrial listed Centennial Coal Limited, Managing Director of Access
property and business space arena. Gregory co-founded Macquarie, the commercial arm of Macquarie University in
Macquarie Goodman Industrial Trust and played an Sydney, and a director of the Centre for Independent Studies
integral role in establishing its position as the largest listed in Australia.
industrial property trust on the Australian Stock Exchange.
He spearheaded the listing of A-REIT in Singapore and
oversaw the merger of Macquarie Goodman Industrial Trust
and Macquarie Goodman Management Limited to create
Macquarie Goodman Group and managed its progression as
a leading, international industrial property group.Ascendas real estate investment trust
annual report FY2006/2007 15
05 | Mr James Hodgkinson 07 | Mr Benedict Kwek Gim Song
Director Independent Director
Mr Hodgkinson is an Executive Director of Macquarie Bank Mr Kwek is the Chairman of Korvacs Payment Systems
Limited and co-head of Macquarie Bank Ltd’s Real Estate Services, a private company providing payment infrastructure
Capital (“REC”) division. He is responsible for REC’s businesses, services to financial institutions. He is also a director of Evans
including activities in Asia focusing on REIT development & Peck (Singapore) Pte Ltd and NTUC Club and is a director
management and core real estate investment. He is also a and Chairman of the Auditing Committee of NTUC Choice
director of Macquarie Goodman Group and Macquarie Pacific Homes Co-Operatives Ltd. Mr Kwek, with 32 years of banking
Star Prime REIT Management Limited. Mr Hodgkinson is a experience, was formerly the President and CEO of Keppel
certified practising accountant, and a fellow of the Australian TatLee Bank Ltd. He was previously a director of Jurong Port
Property Institute with over 19 years experience in property Pte Ltd and Chemical Industries Far East Ltd.
funds management, investment banking and chartered
accounting.
08 | Mr Swee Kee Siong
Director
06 | Ms Chong Siak Ching
Director Mr Swee is the Chairman of the Investment Committee of
Ascendas India IT Parks Trust. He is a Fellow of the Royal
Ms Chong is the President and Chief Executive Officer of Institution of Chartered Surveyors and Fellow of the
Ascendas Pte Ltd. She sits on the boards of Ascendas Pte Ltd Singapore Institute of Surveyors and Valuers. He has over
and its subsidiaries. Ascendas pioneered Singapore’s first 29 years of experience in planning, developing, marketing
business space trust, Ascendas REIT in Nov 2002, as well as and managing industrial estates, business and science parks
launched India’s first IT Parks Fund in June 2005. Ms Chong in Singapore. Mr Swee was a member of URA Master Plan
is a member on the board of the Singapore Tourism Board, Committee from 1995 to 1998, the Chief Executive Officer of
one of Singapore’s three representatives to the APEC Business Ascendas Singapore operations and the Singapore Science
Advisory Council, and Chairman of the Network India Park, and the Deputy Chief Executive Officer of Jurong Town
Steering Committee. Previously Jurong Town Corporation’s Corporation.
Deputy Chief Executive Officer, she has extensive experience
in business space management.
09 | Mr David van Aanholt
Director (Alternate Director to Gregory Leith Goodman)
Mr van Aanholt was appointed alternate director to Mr
Goodman on 29 May 2006. He is the Chief Executive Officer
Australia of Macquarie Goodman. With over 18 years of
experience in the property industry, he has been a key
participant in the growth of Macquarie Goodman as one
of the leading owner, manager and developer of industrial
property in Australia, New Zealand and Asia. He was also
heavily involved in Macquarie Goodman’s entry into the UK
and European market.16
Significant Events
April 2006 17th
13th 2Q FY06/07: Distribution per unit grew by
Financial Year ended 31 March 2006 8.7% y-o-y
Distribution per unit grew by 22.2% y-o-y
December 2006
June 2006 14th
14th Announced construction of partial built-to-suit
Acquired Sembawang Kimtrans Logistics Centre distribution centre at Plot 7 & 8 Changi LogisPark
for $19.6 million and Logistics 21 for $58.4 million (North)
July 2006 16th
13th Completion of Courts Megastore for Courts (S) Ltd
1Q FY06/07: Distribution per unit grew by under the Warehouse Retail Scheme
9.0% y-o-y
January 2007
September 2006 8th
1st Acquired Super Industrial Building and
Announced construction of partial built-to-suit 26 Senoko Way for $49.0 million in aggregate
business park property (Hansa Point @ CBP) 12th
Acquired iQuest @ IBP for $18.6 million
October 2006
10th 16th
Acquired LabOne Building Singapore for 3Q FY06/07: Distribution per unit grew by
$20.0 million 6.3% y-o-yAscendas real estate investment trust
annual report FY2006/2007 17
Giant Hypermart
February 2007
1st
Acquired 2 Changi South Lane, 1 Kallang Place,
18 Woodlands Loop, 9 and 11 Woodlands Terrace
from Flextronics Group of Companies for
$63.1 million in aggregate
6th
Completion of Giant Hypermart for Cold Storage
Singapore (1983) Pte Ltd under the Warehouse
Retail Scheme
14th Sembawang Kimtrans Logistics Centre
Announced private placement of 40,323,000 new
units to fund new acquisitions and undertake
property development activities to develop
suitable properties
26th
Private placement of 40,323,000 new units at $2.48
per unit completed
LabOne18
The A-REIT Team
1 2 3 4 5 6 7 8 9 10 11 12 13 14
15 16 17 18 19 20 21 22 23 24 25 26 27Ascendas real estate investment trust
annual report FY2006/2007 19
01. Ng Boon Gek 11. Tan Shu Lin 21. Shane Hagan
02. Sharon Seet 12. Loh Kar Yen 22. Maria Theresa Belmonte
03. Alison Wong 13. Faith Chong 23. Han Ben Juan
04. Mary De Souza 14. Patricia Goh 24. Vincent Lee
05. See Ying Hwee 15. Faith Soh 25. Huang Ying Ying
06. Christine Ong 16. Yong Kok Fong 26. Jenny Wong
07. Clarine Peh 17. Teo Ai Leen 27. Roy Teo
08. Stefanie Tan 18. Arthur Koo 28. Foo Pei Teng (not in picture)
09. Kevin Lee 19. Sabrina Tay
10. Rina Ang 20. Tan Ser Ping20
The A-REIT Team
Tan Ser Ping Tan Shu Lin
Chief Executive Officer Fund & Investor Relations Manager
Ser Ping is responsible for the overall management and Shu Lin’s responsibilities include working with the CEO to
operations of A-REIT. He works with the Board of Directors formulate strategic plans for A-REIT, analyzing and tracking
to determine the business strategies and plans for the property performance to ensure budgets are met, as well as
strategic development of A-REIT. He also works closely with trust forecasting. In addition, she is responsible for liaising
the A-REIT team to ensure that the operations of A-REIT are with analysts as well as potential and existing investors.
in accordance with the stated business strategies. Prior to Prior to joining the Manager, Shu Lin was Assistant Vice
joining the Manager, he was the Executive Vice President of President of Real Estate Fund Management at Ascendas
Real Estate Development & Investment of Ascendas Pte Ltd. Pte Ltd where she was responsible for developing property
Before joining Ascendas, Ser Ping was the Senior General fund management activities in the region. She was also
Manager for the Residential & Commercial Business Group responsible for sourcing and evaluating potential investment
of China-Singapore Suzhou Industrial Park Development opportunities in the region. Shu Lin graduated with a
Company Ltd. He also held senior positions in various banks. First Class Honours degree in Economics from University
Ser Ping holds a Master of Business Administration degree of Portsmouth, United Kingdom and is also a Chartered
from the University of Leicester, United Kingdom and is Financial Analyst.
a Bachelor of Accountancy (Honours) graduate from the
National University of Singapore.
Maria Theresa Belmonte
Legal Counsel & Compliance Manager
Shane Hagan Assistant Company Secretary
Chief Financial Officer Theresa’s responsibilities include providing legal advice in
Shane is responsible for the finance function including all areas within A-REIT including legal documentation for
financial reporting, treasury, taxation, compliance execution, acquisitions. She also serves as the Compliance Manager for
and matters relating to A-REIT’s debt and equity. He has A-REIT and assists in A-REIT’s corporate secretarial matters.
over 17 years of finance experience, including 11 years of She was formerly an in-house legal counsel in a SGX-listed
property funds management experience. Prior to joining company and prior to that was a practicing lawyer. She has
the Manager, he was responsible for the financial, legal and previous experience in the areas of real property law, general
company secretarial functions of two New Zealand Stock corporate law and corporate secretarial work. Theresa was
Exchange listed property companies. Shane also held various called to the Singapore Bar after graduating with an LL.B
management roles for Fletcher Challenge, formerly New (Hons) from the National University of Singapore.
Zealand’s largest company involved in Forestry, Building and
Oil & Gas exploration, and has prior working experience in
the Asia Pacific region. Shane is a member of the Institute of
Chartered Accountants in New Zealand and holds a Bachelor Foo Pei Teng
of Commerce and Administration degree from Victoria Portfolio Manager (Business and Science Park & Warehouse
University, New Zealand. Retail Properties)
Pei Teng is responsible for developing investment and
asset management strategies for A-REIT’s business, science
park and warehouse retail properties. Prior to joining the
Manager, Pei Teng was a Business Development Manager
with Ascendas Pte Ltd. She was involved in the evaluation
of several regional real estate development and investment
deals in Korea, Australia and the Philippines. Pei Teng
graduated with a Bachelor of Business (Honours) degree in
Financial Analysis from Nanyang Technological University
and a Master of Science degree in Real Estate from National
University of Singapore.Ascendas real estate investment trust
annual report FY2006/2007 21
Kevin Lee Faith Soh
Portfolio Manager (Light Industrial Properties) Director, Asset Management (Customer Care)
Kevin is responsible for developing investment and Asset Manager (Business and Science Park & Warehouse
asset management strategies for A-REIT’s light industrial Retail Properties)
properties. Prior to joining the Manager, Kevin was Director Faith oversees the development and implementation of
at an international property consultant where he has served A-REIT’s customer care programme to ensure that the needs
corporate clients and banks involving asset appraisals and of our customers are well taken care of. She is also responsible
investment advisory. Kevin is a licensed valuer and also a for developing asset management strategies and plans
member of the Royal Institution of Chartered Surveyors. for A-REIT’s Business and Science Park & Warehouse Retail
He holds a Bachelor of Science degree in Land Management properties. Prior to her appointment with the Manager, Faith
from University of Reading, United Kingdom. was part of Ascendas Services Pte Ltd’s lease management
team and was also involved in A-REIT’s IPO in 2002. Faith is a
licensed valuer and holds a Bachelor of Business (Property)
from University of South Australia.
Alison Wong
Director, Asset Management (Operations)
Portfolio Manager (Hi-Tech Industrial Properties)
Alison coordinates the asset management operations across Vincent Lee
the various portfolios to ensure streamlined operational Asset Manager (Light Industrial Properties)
systems and processes to achieve the desired level of With over 10 years of experience in the property industry,
performance for A-REIT. She is also responsible for developing Vincent is responsible for developing asset management
investment and asset management strategies and plans strategies and plans for A-REIT’s portfolio of light industrial
for A-REIT’s Hi-Tech Industrial properties. Alison has over 15 properties. Prior to his appointment with the Manager,
years of experience in the areas of property management, Vincent held various positions with Suntec City Development
development, lease management and local and international and Knight Frank, spanning diverse areas such as property
marketing. Prior to her appointment with the Manager, she sales, leasing, research and analysis. Most recently, he served
was heading the Singapore marketing team of Ascendas Land as an asset analyst in Lend Lease Real Estate Investments
(Singapore) Pte Ltd as Assistant Vice President. Alison holds a (“LLREI”), where he oversaw asset management of high-tech
Bachelor of Science degree in Estate Management from the industrial space owned by a LLREI-managed wholesale fund.
National University of Singapore. Vincent holds a Master of Applied Finance from the University
of Adelaide and a Master of Real Estate from the University
of New South Wales, Australia and a Bachelor of Commerce
in Urban Land Economics from the University of British
Columbia, Canada.
Roy Teo
Asset Manager (Logistics & Distribution Centres)
Roy is responsible for developing asset management
strategies and plans for A-REIT’s portfolio of logistics &
distribution centres. Prior to his appointment with the
Manager, Roy was the Assistant Manager of Business
Development at Keppel Logistics Pte Ltd. He has over
five years of experience in the logistics industry in areas
including finance, accounting, project management and
business development in Singapore and regionally. Roy
holds a Bachelor of Science (Honours) degree in Applied
Accountancy from Oxford Brookes University and is an
Affiliate member of the Association of Chartered Certified
Accountants.22
A-REIT Structure
HSBC Institutional Trust Services
(Singapore) Ltd
Acts on behalf
of Unitholders Trustee Fees
Distributions Ownership of assets
Investment in A-REIT Net property income
Unitholders Properties
6.3% Management Management 19.2%
services fees
Property Property
management management
services fees
Macquarie
Ascendas Group
Goodman Group
60% 100%
40%
Ascendas-MGM Funds Management Ltd Ascendas Services Pte Ltd
(A-REIT Manager) (Property Manager)
(Reports to A-MGM Board of Directors) (Reports to ASPL Board of Directors)
Responsible for Responsible for
Total
Returns Revenue Management
Predictable Income Capital Stability - Occupancy improvements
- Rental rates
Outcome Expense Management
Stability Growth - Efficiency improvements
- Cost savings initiatives
Strategies Optimised Captial Proactive Asset Value-Adding Property Management
Structure Management Investments
- Property maintenance service standard, etc
• Equity raising • Portfolio • Yield accretive - Site staff management
positioning and acquisitions
• Debt funding strategies Customer Care
• Built-to-Suit
• Interest rate risk • Supervise projects - Customer retention
management execution - Customer satisfaction, etc
of asset • Development
• Cost of capital management
Drives portfolio performanceAscendas real estate investment trust
annual report FY2006/2007 23
The Property Manager
Ascendas Services Pte Ltd (“ASPL”)
The property management function of A-REIT’s
properties is outsourced to Ascendas Services Pte Ltd
(ASPL), a 100% owned subsidiary of Ascendas Land
(Singapore) Pte Ltd.
Under the leadership of its CEO, Mr Tan Yew Chin,
the ASPL team is committed to providing proactive
and professional operational services by working
closely with our asset management team to enhance
the market positioning of our properties to maximize
returns.
The ASPL team oversees day-to-day operational
matters such as coordinating customers’ fitting
out requirements, supervising the performance
of contractors and ensuring building and safety
regulations are not compromised on.
In addition, they are tasked with the following
responsibilities:
Revenue and Occupancy Management
The ASPL team actively markets and leases vacant
space within A-REIT’s portfolio of properties. They also
work on expanding and renewing leases with existing
customers to gather positive rental reversion.
Property Management The ASPL Team
Working hand-in-hand with the Manager’s asset From left to right:
Standing: Mr Chee Han Hock, Mr Tan Yew Chin, Mr Mark Chan
management team, staff from ASPL ensure that
Seated: Mr Dacon Pao, Ms Toh Lay Gan, Ms Tay Mui Chin, Mr Daniel Tan
the property specifications and service levels are
commensurate to the intended market positioning
of the property. The ASPL team is also responsible for
Customer Care
managing the site staff to ensure that the desired level
of property and customer care is implemented at the The ASPL team plays a pivotal role in maximising customer
respective properties. retention through the implementation of the Customer Care
Program. The program is set up through periodic discussion
Expense Management between the ASPL team and Asset Managers to ensure
that a desired level of customer service is delivered to our
The ASPL team adopts a prudent operational strategy
customers. The team is also responsible for the management
in line with the Manager’s objective to maximizing
of accounts receivable. They minimize arrears and bad debts
return without comprising on service standards.
by continuously monitoring customer credit.
They strive to improve operating processes
continuously to optimize operational cost so as to
The team from ASPL is committed to providing optimal
ensure efficient division of labour and effectiveness
solutions and services to meet the needs of A-REIT’s
during the execution of their day-to-day operations.
customers as well as enhance the property value of A-REIT’s
portfolio.24
Investment Property Portfolio
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Business & Science Parks Hi-Tech Industrial Properties Light Industrial Properties / Flatted Factories
29% share of Business & Science 38% share of Hi-Tech Industrial space 2.1% share of Light Industrial & Flatted Factory
Park space in Singapore in Singapore space in Singapore
1. The Alpha 13. Techlink 27. Techplace I 44. 84 Genting Lane
2. The Aries 14. Siemens Centre 28. Techplace II 45. Hoya Building
3. The Capricorn 15. Infineon Building 29. OSIM HQ Building 46. NNB Industrial Building
4. The Gemini 16. Techpoint 30. Ghim Li Building 47. 37A Tampines St 92
5. Honeywell Building 17. Wisma Gulab 31. Progen Building 48. Hamilton Sundstrand
6. Ultro Building 18. KA Centre 32. SB Building Building
7. Telepark 19. KA Place 33. 247 Alexandra Road 49. Thales Building
8. Techquest 20. Kim Chuan 34. Steel Industries Building 50. Aztech Building
9. 30 Tampines Industrial Ave 3 Telecommunications Complex 35. Volex Building 51. Ubi Biz-Hub
10. PSB Building 21. Pacific Tech Centre 36. 53 Serangoon North Ave 4 52. 1 Kallang Place
11. LabOne Building 22. Techview 37. Da Vinci Building 53. 11 Woodlands Terrace
12. iQuest @ IBP 23. 1 Jalan Kilang 38. 27 Ubi Road 4 54. 18 Woodlands Loop
24. 50 Kallang Avenue 39. 52 Serangoon North Ave 4 55. 9 Woodlands Terrace
25. 138 Depot Road 40. Hyflux Building 56. Super Industrial
26. 2 Changi South Lane Building
41. Weltech Building
57. 26 Senoko Way
42. BBR Building
43. Tampines Biz-HubYou can also read
