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Note:
(1) Stated at present value (face value is S$8m)
(2) Based on deposited property
(3) Including financial derivatives
DEBT HIGHLIGHTS AS AT 31 DECEMBER 2007
Term loan (CMBS equivalent)
Bridging loan
Revolving Credit Facilities
Japanese bond
Payable to Chinese property vendor (1)
S$380m
S$160m
S$ 75m
S$ 40m
S$ 6m
Total Debt S$661m
Gearing ratio (2)
Fixed rate debt (up to Sept 2010) (3)
Interest cover
Weighted average interest
rate per annum
29.0%
89.4%
4.5x
2.69% p.a.
Income Hedging
MMP REIT’s policy is to hedge the majority of the
forecast net income from its overseas investments in
the next two years, in order to minimise the impact
of exchange rate fluctuations on the distributions
to unitholders.
As at 31 December 2007, MMP REIT has entered
into a combination of foreign exchange forward
contracts and cross currency swap contracts to hedge
approximately 87% of the forecast foreign net income
for the next two years.
Capital Hedging
MMP REIT’s policy is to hedge substantially all of
its capital invested in foreign currencies, in order to
minimise the impact of exchange rate fluctuations on
the net asset value of the Trust.
As at 31 December 2007, MMP REIT has entered into
a combination of foreign currency denominated loans,
cross currency swap contracts and foreign currency
options to hedge approximately 95% of its net assets
denominated in foreign currencies.
Increased Debt Capacity
MMP REIT had a relatively low gearing of 29.0%
as at 31 December 2007, on the strength of higher
revaluations of its Singapore properties, valued at
S$1,932 million and revaluations of its Japanese and
China properties valued at a total of S$277 million as at
31 December 2007.
The Manager intends to maintain a long term optimal
gearing level of 45% for MMP REIT. This means
that MMP REIT has the capacity to raise up to
S$662 million of additional borrowings to fund new
investments and acquisitions without having the need
to raise equity. MMP REIT may also raise the gearing
above this limit for short periods to quickly secure
strategic and opportunistic yield accretive acquisitions.
2008 2009 2010 2011 Beyond
2012
Bridging loan
RCF - Citi
Japanese bond
Payable to Chinese
property vendor
RCF - SCB
Term loan (CMBS)
Debt S$m
0
50
100
150
200
250
300
350
400
380
60
160
15
236*
0.9 0.9 0.9 0.9 40
2.7
Debt Maturity Profile as at 31 December 2007
Note:
* S$190m is due at the end of May 2008, the balance is due in August and
September 2008.
CAPITAL MANAGEMENT