Property
Portfolio Summary
PORTFOLIO VALUATION
Description
30 Jun 2015
(S$ million)
31 Dec 2013
(S$ million)
Change
(S$ million)
Change
(%)
Wisma Atria Property
987.5
961.5
26.0
2.7%
Ngee Ann City Property
1,084.0
1,074.0
10.0
0.9%
Australia Properties
(1)
500.2
208.1
292.1
140.3%
Malaysia Properties
(2)
396.3
427.8
(31.5)
(7.4%)
Renhe Spring Zongbei Property
(3)
66.3
81.7
(15.4)
(18.8%)
Japan Properties
(4)
81.9
101.3
(19.4)
(19.2%)
3,116.2
2,854.4
261.8
9.2%
Notes:
(1)
Translated on 30 June 2015 at A$0.97:S$1 (31 December 2013: A$0.89:S$1).
(2)
Translated on 30 June 2015 at RM2.81:S$1 (31 December 2013: RM2.59:S$1).
(3)
Translated on 30 June 2015 at RMB4.61:S$1 (31 December 2013: RMB4.79:S$1).
(4)
Translated on 30 June 2015 at JPY90.94: S$1 (31 December 2013: JPY83.03:S$1).
which provides for an annual review.
Collectively, these master leases
and long-term leases accounted for
42.3% of the Portfolio’s gross rent
for June 2015.
The Manager actively manages the
remaining leases of the Portfolio,
which are on a short- to medium-
term basis. For the Singapore
Properties, besides the Toshin
master lease, earnings are derived
from retail leases in Wisma Atria
Property and Ngee Ann City
Level 5, as well as office leases
which are generally contracted
for a three-year period.
The Japan Properties generally
have tenancies with two- to five-
year lease terms while the specialty
retail units in the David Jones
Building and Plaza Arcade in Perth,
as well as the Myer Centre Adelaide
in Adelaide generally have one-
to five-year lease terms. The
Renhe Spring Zongbei Property in
Chengdu operates as a department
store with mostly short-term
concessionaire leases running
from three to 12 months.
As at 30 June 2015, the weighted
average lease term expiry (by NLA)
of the Portfolio is 6.8 years.
STRONG PERFORMANCE FOR
THE SINGAPORE PROPERTIES
The Singapore Properties consist
of both retail and office spaces,
which enjoy a combined occupancy
of 99.3% as at 30 June 2015. Prime
retail spaces including Wisma
Atria and Ngee Ann City enjoy
strong demand from international
retailers and new-to-market brands
looking to launch their products
in the region. The Wisma Atria
Property (Retail) enjoyed positive
rental reversions of 10.0% for leases
committed in FY 2014/15, as well
as centre sales of S$291.7 million
in FY 2014/15.
The office portfolio in the Singapore
Properties achieved a positive
rental reversion of 8.8% for leases
committed in FY 2014/15. The strong
performance of the office properties
can be attributed to their strategic
location, which appeals especially
to tenants from the fashion retail,
medical and services industries.
WEAKENING GROWTH
IN CHINA’S LUXURY
RETAIL MARKET
In China, GDP growth continued
to ease from 7.4% in 2014 to
7.0% in 1H 2015. Chengdu’s GDP
growth slowed down to 8.0% in
1H 2015, from 8.9% in 2014 but
still outpacing the national level.
As the ongoing austerity drive
which started in 2012 continues
to dampen the high-end luxury
market, Chengdu’s retail sales
growth slowed from 13.6% in
1H 2014 to 10.9% for 1H 2015. With
the influx of retail supply in recent
and future years, the retail market
in Chengdu continues to remain
challenging. The Renhe Spring
Zongbei Property will continue to
enhance its tenant mix to maintain
competitiveness in the market
and contain costs.
VALUATION
Starhill Global REIT’s property
portfolio was valued at
S$3,116.2 million as at 30 June 2015,
an increase of approximately
S$261.8 million compared to the
valuation as at 31 December 2013.
The increase was mainly driven
by the acquisition of the Myer
Centre Adelaide in Australia, offset
by negative foreign currency
movements and the drop in the
value of the Renhe Spring Zongbei
Property. Holon L in Tokyo, Japan
was divested in March 2014 as part
of our strategy to refine our portfolio.
As at 30 June 2015, the combined
valuation of the Wisma Atria
Property and the Ngee Ann
City Property increased to
S$2,071.5 million or a S$36.0 million
increase from 31 December 2013,
driven by higher rents secured for
the retail and office components.
The combined valuation of
the Australia Properties was
A$484.5 million (approximately
S$500.2 million), increasing
from that as at 31 December
2013 due to the acquisition of
Myer Centre Adelaide and lower
capitalisation rates for the David
Jones Building and Plaza Arcade
to reflect recent transacted yields
for retail properties. This increase
was partially offset by the weaker
Australian dollar in Singapore dollar
terms.
The Malaysia Properties were valued
at RM1,112.1 million (approximately
S$396.3 million) which saw an
increase in valuation in Malaysian
Ringgit terms from the valuation as
at 31 December 2013 mainly due to
lower property tax expenses. The
valuation of the Malaysia Properties
in Singapore dollar terms was
however affected by the weaker
Malaysian ringgit as compared
to 2013.
The valuation of Renhe Spring
Zongbei Property declined
RMB85.0 million (approximately
S$15.4 million) compared to
that as at 31 December 2013 due
to lower income assumed. The
Chinese Government launched a
series of austerity measures which
affected sales. The entry of new
retail malls in Chengdu has also
increased competition for tenants
and reduced shopper traffic at the
Renhe Spring Zongbei Property.
The Japan Properties were valued at
JPY7,448.0 million (approximately
S$81.9 million), a decrease of
JPY964.0 million in local currency
terms from the previous valuation
as at 31 December 2013 due to the
divestment of Holon L. Furthermore,
the depreciation of the Japanese Yen
caused the value of the remaining
five Japanese properties to decrease
8.7% as compared to that as at
31 December 2013 in Singapore dollar
terms. The Japan Properties are fully
hedged by Yen denominated loans.
S$1,813 million
uplift since IPO
Sep
05
Dec
05
Dec
06
Dec
07
Dec
08
Dec
09
Dec
10
Dec
11
Dec
12
Dec
13
Jun
15
Wisma Atria Property
Ngee Ann City Property
Australia Properties
Malaysia Properties
Renhe Spring Zongbei Property
Japan Properties
Total
3,500
3,000
2,500
2,000
1,500
1,000
500
0
PORTFOLIO VALUATION
(S$ million)
1,303 1,327
1,498
2,209 2,103
1,982
2,654 2,710 2,713
2,854
3,116
37
36
STARHILL
GLOBAL
REIT
Annual
Report
FY 2014/15
