Letter to
Unitholders
Trust
Structure
REIT
Manager
Unitholders
The
Properties
(2)
Subsidiaries
or SPVs
(3)
Property
Manager
(1)
Trustee
Hold Units
Acts on behalf
of Unitholders
Management
Fees
Ownership
of Assets
Ownership
of Assets
Property
Management Services
Distributions
Trustee
Fees
Management
Services
Net Property
Income
Net Property
Income
Property
Management Fees
borrowings, the average interest cost
of Starhill Global REIT only increased
marginally to approximately 3.2%
per annum as at 30 June 2015.
Standard & Poor’s Ratings Services
has affirmed Starhill Global REIT’s
“BBB+” rating with a stable outlook
in April 2015.
We have also been actively
refinancing existing facilities ahead
of maturities, diversifying funding
sources by tapping the bond market,
and extending the tenor of our loans
as we locked in financing cost to
mitigate interest rate exposure.
While average debt maturity
remained stable at 3.5 years as
at 30 June 2015, the maturity
profile is better staggered with
maturity being extended up to
year 2023. With the recent series of
refinancing in July 2015, there will
be no significant debt refinancing
requirement until 2018 and average
debt maturity has been extended
to approximately 4.1 years.
Starhill Global REIT derived 67.3%
(or approximately 57%
(2)
based on
full period contribution from Myer
Centre Adelaide) of the Group’s
revenue from its Singapore assets
for FY 2014/15. Foreign exchange
and interest rates environment have
experienced recent volatility. Foreign
exchange exposure for FY 2014/15
has been partially hedged via foreign
currency borrowings and short-term
foreign currency forward contracts.
As at 30 June 2015, we have also
proactively hedged all our interest
rates exposure through interest rates
swaps and caps thus mitigating the
impact of interest rates fluctuation
on DPU.
DELIVERING 10 YEARS OF
GROWTH AND PERFORMANCE
This September 2015 will mark the
10 years’ anniversary of Starhill
Global REIT since the listing on the
SGX-ST in September 2005. Over the
course of this period, the REIT has
delivered a compound annual
growth rate (CAGR) of 7.2%
(1) (3)
in DPU. Starhill Global REIT is one
of the largest REITs listed on the
SGX-ST with market capitalisation
at S$1.9 billion as at 30 June 2015,
the 13th highest amongst 32 listed
REITs. The sterling performance was
achieved due to its focus on prime real
estate. The portfolio has grown from
just S$1.3 billion solely in Singapore
to S$3.1 billion in five countries across
the Asia-Pacific with overseas assets
contributing about 33% of its revenue
for FY 2014/15. With a balanced
portfolio of master and long-term
leases as well as actively managed
leases, Starhill Global REIT has kept
portfolio occupancy at above 95%
over the last 10 years. We ended
the past 10 years having delivered
strong growth in assets and solid
performance.
LOOKING AHEAD
The International Monetary Fund’s
regional economic outlook forecasts
that growth in the Asia-Pacific area
will moderate to 5.5% next year. This
will lead to the moderation in regional
tourism and retail spending growth in
the immediate future. The prolonged
manpower crunch in Singapore may
also dampen some retailers’ plans for
expansion. The retail environment in
Chengdu remains challenging with
the ongoing austerity measures and
new supply of malls. Interest rates
and foreign exchange markets are
expected to remain volatile.
Notwithstanding the above, Asia’s
growing middle income class will
continue to underpin the longer term
retail scene. Starhill Global REIT’s
portfolio of properties in prime
locations is well-positioned to cater
to the growing pool of international
retailers seeking to establish their
presence in the region. We will
continue to refine our portfolio by
further trimming exposure of non-
core assets and selectively acquiring
prime real estate in our core cities.
We remain focused on optimising
the performance of our assets, while
leveraging on our balanced retail mall
portfolio and adopting a prudent
capital management approach, to
deliver sustainable long term returns
to Unitholders.
ACKNOWLEDGEMENTS
The Board and Management would
like to thank our directors for
their invaluable contributions and
guidance, our colleagues for their
hard work and dedication, and
our tenants, business partners and
investors for their continued trust
and support. We would also like to
thank you, our Unitholders, for your
support and confidence in Starhill
Global REIT since listing.
TAN SRI DATO’ (DR)
FRANCIS YEOH SOCK PING
PSM, CBE, FICE, SIMP, DPMS,
DPMP, JMN, JP
Executive Chairman
HO SING
Chief Executive Officer and
Executive Director
28 August 2015
Notes:
(1)
The Property Manager manages the Singapore Properties, namely
the Wisma Atria Property and the Ngee Ann City Property. The
overseas properties are managed by external property managers.
(2)
The Singapore Properties are held by Starhill Global REIT. The
overseas properties are held through its subsidiaries or special
purpose vehicles (SPVs).
(3)
The net income from overseas properties are largely repatriated
to Starhill Global REIT via a combination of trust distributions,
dividends, interest, as well as repayment of shareholders’ loans
and/or redemption of redeemable preference shares.
Notes:
(1)
The REIT’s DPUs from FY 2005 to 2Q FY 2009 have been restated to include the 963,724,106 rights units issued in August 2009.
(2)
Proforma financial effects are strictly for illustrative purposes only and were prepared based on the unaudited consolidated financial
statements of Starhill Global REIT for the 12 months ended 31 December 2014.
(3)
Excluded FY 2005 and the additional six months from January 2015 to June 2015 for FY 2014/15.
23
22
STARHILL
GLOBAL
REIT
Annual
Report
FY 2014/15
