2013
Annual Report
SINGAPORE LAND LIMITED
Chairman’s Statement
2012
OVERVIEW Singapore saw a deep economic dip at the beginning of the year. However, a strong second half and the Government’s $20.5 billion stimulus package helped Singapore pull through a difficult year with a GDP contraction of 2%.
Performance Review and Dividend Despite declining office rental rates in 2009, the Group’s gross rental income increased by $23.3 million (10%) to $255.0 million as we continued to benefit from leases signed earlier. Following the sales launch of the Group’s wholly- owned residential project, The Trizon, in the third quarter of 2009, property sales of $46.3 million was progressively recognised. Revenue of The Pan Pacific Singapore, however, declined by $26.9 million (23%) to $90.5 million as room rates weakened on the back of lower visitor arrivals. Overall, the Group’s total gross revenue of $397.5 million represented a net increase of $42.2 million (12%). Notwithstanding lower profits in Marina Mandarin and Mandarin Oriental Hotels, progressive recognition of profits from sales of residential properties (One Amber and The Sixth Avenue Residences) contributed to a $3.0 million (6%) increase in share of associated companies’ operating results to $56.1 million. With lower operating and finance expenses, the Group registered a net operating profit of $203.3 million, an increase of $44.8 million (28%). Based on year end valuation by professional valuers, the value of the Group’s investment commercial properties declined by 14%. The fair value loss of $469.2 million (2008: $275.9 million), net of deferred income tax adjustments, was charged to income statement, resulting in an overall net loss of $266.0 million (2008: $117.4 million).
The Board recommends a first and final tax exempt (one-tier) dividend of 20.0 cents (2008: 20.0 cents) amounting to $82.5 million (2008: $82.5 million) for the financial year ended 31 December 2009.
Singapore Office, Retail Properties and Hotels During the year under review, the Group maintained an average occupancy in excess of 90% for its office properties. Gross office rental income for the Group was $180.8 million compared to $155.5 million in the previous year. To keep up with the increasing competition posed by newer malls, Marina Square was continually refreshed throughout the year by new international lifestyle brands and largescale shows like the National Day exhibition, which attracted about 150,000 shoppers a day. Occupancy of the 650,000 square feet of retail space and rental rates remained healthy. The Singapore hospitality industry was significantly weaker in 2009 due to the economic crisis and the outbreak of the H1N1 flu virus and the three Marina Square hotels turned in results that were in line with the industry. West Mall celebrated its 11th anniversary with vibrant promotions throughout the year. New retailers were also brought into the Mall to strengthen the tenant mix. Notwithstanding its age, West Mall was able to achieve 100% occupancy.
Novena Square, in which the Group has a 20% interest, successfully positioned itself as a one-stop sports mall by collaborating with leading sports organisations like the Singapore Sports Council and Mizuno. Average occupancy for the retail mall was maintained at 99%.
Singapore Residential Projects The Group has completed about 16% of the residential project The Trizon, which is located in the prime Holland Road area, with TOP expected in 2013. The Trizon is the Group’s wholly-owned project and the 289-unit condominium was 45% sold at the end of December 2009.
Overseas Investments In Chengdu, China, the Group’s whollyowned condominium project named “Lang Yu” (“The Excellency”) comprising 468 units, is currently under construction. The development which is located close to the shopping belt in Dacisi Road will be officially launched for sale in March 2010. The Beijing Landmark Towers is a prime district mixed development of hotel, apartments and offices, in which the Group holds 19.95% interest. Dividend of $2.6 million was received from this investment in 2009. Wee Cho Yaw Chairman Singapore, 7 August 2012
Board of Directors
WEE CHO YAW Chairman
Dr Wee Cho Yaw was appointed a Director and Deputy Chairman of Singapore Land Limited (“SingLand”) in 1992. He became the Chairman of SingLand with effect from 16 January 1996. He has more than 50 years of experience in the banking industry. He is the Chairman of the United Overseas Bank Limited, Far Eastern Bank Ltd, United Overseas Insurance Ltd, United International Securities Ltd, UOL Group Limited, Haw Par Corporation Limited, Pan Pacifi c Hotels Group Limited, United Industrial Corporation Limited and Marina Centre Holdings Private Limited. He is also the Chairman of the Wee Foundation. He was appointed Pro-Chancellor of Nanyang Technological University in 2004 and was conferred Honorary Doctor of Letters by the National University of Singapore in 2008. Dr Wee was conferred the Businessman Of The Year award twice at the Singapore Business Awards in 2001 and 1990. In 2006, he received the inaugural Credit Suisse-Ernst & Young Lifetime Achievement Award for his outstanding achievements in the Singapore business community. In 2009, he was conferred the Lifetime Achievement Award by The Asian Banker. In 2011, Dr Wee was awarded the Distinguished Service Order, the highest National Day award, by the Government for his contributions towards the community and education in Singapore.
JOHN GOKONGWEI, JR. Deputy Chairman
Dr John Gokongwei, Jr. was appointed a Director and Deputy Chairman of SingLand in 1999. As of January 2002, he is the Chairman Emeritus of JG Summit Holdings, Inc., a company incorporated in the Philippines and listed on the Philippines Stock Exchange Inc., since its formation in 1990. He is also a Director and Deputy Chairman of United Industrial Corporation Limited, Director of Marina Centre Holdings Private Limited, Universal Robina Corporation, Robinsons Land Corporation, Oriental Petroleum and Minerals Corporation and Anscor Phils. Dr Gokongwei received a Master in Business Administration from the De la Salle University in the Philippines, and attended the Advanced Management Program at Harvard University, Boston, Massachusetts, USA.
James L. Go
Mr James L. Go was appointed a Director of SingLand in 1999. He is the Chairman and Chief Executive Offi cer of JG Summit Holdings, Inc., Robinsons, Inc. and Oriental Petroleum and Minerals Corporation. He is the Chairman of Universal Robina Corporation, Robinsons Land Corporation and JG Summit Petrochemical Corporation. He is also the President and a Trustee of the Gokongwei Brothers Foundation, Inc. He also sits as a director of Cebu Air, Inc., United Industrial Corporation Limited, Marina Centre Holdings Private Limited and Hotel Marina City Private Limited. He was elected as a director of the Philippine Long Distance Telephone Company (PLDT) on November 3, 2011 and was appointed a member of PLDT’s Technology Strategy Committee. Mr Go graduated with a Bachelor of Science and Master of Science, Chemical Engineering from Massachusetts Institute of Technology, USA.
HWANG SOO JIN GWEE LIAN KHENG Lim Hock San President and CEO
Mr Lim Hock San, the President and Chief Executive Officer, was appointed a Director of SingLand in 1992. Mr Lim is also the President and Chief Executive Officer of United Industrial Corporation Limited and the Chairman of the National Council On Problem Gambling. Mr Lim graduated with a Bachelor of Accountancy from the University of Singapore. He obtained a Master of Science in Management from the Massachusetts Institute of Technology, and attended the Advanced Management Program at Harvard Business School. He is a Fellow of the Chartered Institute of Management Accountants (UK) and a Fellow and past President of the Institute of Certified Public Accountants of Singapore.
Mr Gwee Lian Kheng was appointed a Director of SingLand in 1999. He is the Group Chief Executive of UOL and its listed subsidiary Pan Pacifi c Hotels Group Limited. Mr Gwee has been with the UOL Group since 1973. He also sits on the board of United Industrial Corporation Limited. Mr Gwee graduated with a Bachelor degree in Accountancy (Honours) from the University of Singapore. He is a Fellow Member of the Chartered Institute of Management Accountants, Association of Chartered Certified Accountants and the Institute of Certified Public Accountants of Singapore.
Mr Hwang Soo Jin was appointed a Director of SingLand in January 2003 and is currently the Chairman of the Nominating Committee. He is a Chartered Insurer qualified in the United Kingdom, and has more than 50 years’ business experience. Mr Hwang is currently the Chairman Emeritus and Director of Singapore Reinsurance Corporation Ltd and also sits on the boards of directors of United Overseas Insurance Ltd, Haw Par Corporation Ltd and United Industrial Corporation Limited, among others. He is the former Chairman of Singapore Reinsurance Corporation Ltd. Mr Hwang is an Associate of the Chartered Insurance Institute, United Kingdom.
Managment Review Singapore Commercial Office Investment
2012
OVERVIEW Despite the weak economy, the office rental market held up better than expected, supported mainly by demand from the nonfinancial sectors. Residential property market remained buoyant as it was supported by high liquidity and low interest rates.
SINGAPORE LAND TOWER
CLIFFORD CENTRE
The flagship building continued to perform well in the year under review. Notwithstanding strong competition from new buildings within the Central Business District Core, the building was able to maintain its average occupancy at 98%. Rental revenue, however declined slightly by 2% compared to the preceding year, due to market rents being lower than expiry rents.
Despite being the oldest building in the Group, Clifford Centre managed to improve its average occupancy by 3 percentage points to 99%. Rental revenue also improved by 7% compared to the preceding year.
During the year, several improvement works were undertaken to better meet tenants’ needs. These include the installation of Electronic Parking System to improve traffic flow in the car park, upgrading of washrooms as well as the installation of new cooling towers with energy efficient and water saving features.
The retail premises, which formed 20% of the total lettable area, contributed about 25% of the total rental revenue. As part of our ongoing programme to help retail tenants maintain healthy sales revenue, yearend marketing promotions were organised during the festive season. At Clifford Centre, entry and exit at the car park was made smoother with the upgrading to Electronic Parking System. Closed-Circuit Television system was installed in all lifts to enhance the security system in the building.
SGX CENTRE
THE GATEWAY
SGX Centre managed to maintain an average occupancy of 98% during the year under review. However, rental revenue declined slightly by 3% compared to preceding year due to market rents being lower than expiry rents.
Despite 226,000 square feet of leases expiring during the year, The Gateway performed well and improve its average occupancy by 3 percentage points to 96%. Rental revenue also improved compared to 2011.
The contract to serve as the managing agent for SGX Centre was renewed for another 2 years.
The upgrading of the 32 lifts at The Gateway was completed during the year, providing smoother and faster rides for tenants. As part of the building’s ongoing energy conservation programme, light fittings in staircases were replaced with higher energy efficient ones.
ABACUS PLAZA AND TAMPINES PLAZA In the year under review, both Abacus Plaza and Tampines Plaza achieved full occupancy. Rental revenue also improved by 13% and 4% respectively compared to the preceding year. The Closed Circuit Television system was upgraded to enhance the security of the twin buildings.
SINGAPORE LAND LIMITED