STOCKS. Mapletree Greater , (10.2) (17.2) BUY. Frasers Centrepoint , (5.2) BUY

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1 Singapore Industry Focus Refer to important disclosures at the end of this report DBS Group Research. Equity 18 Feb 2016 Aim for sustainability S-REIT sector still in vogue as market volatility strikes, Picks A-REIT, MAGIC, MLT, FCT and CRCT. DPUs continue to remain stable but boosted by capital returns S-REITs should consider paying more of their management fees in cash to maintain long term stability S-REITs still in vogue as market volatility strikes. With rate hike fears subsiding, we see S-REITs' current yield spread of 4.8% as attractive as it is above the 10- and 5-year average of 3.8% and 4.1%. Thus, we still see upside to share prices in the immediate tem. Our preference is for S-REITs with outsized yields and opportunities to surprise on the upside through acquisitions or with portfolios that continue to withstand operational uncertainties. Our top picks are AREIT, MAGIC, MLT, FCT and CRCT. DPUs remain stable but some were boosted by capital retuns. As expected, 4Q15 results showed cracks in the operating environment on the back of slowing business activities with retail REITs remaining the most stable. We however note that several S-REITs have boosted DPU through capital distributions in 4Q15, which is timely in an environment where stable dividends are valued. However, we believe that the issue of sustainability will rise further given the weak operational growth outlook. While we acknowledge that headline absolute yield still remains a key focus for investors in the near term, it comes at the expense of DPU sustainability which we believe is a more important metric in assessing a REIT s long term viability. S-REITs should consider paying a higher proportion of fees in cash to maintain sustainability. A regular feature amongst S-REITs, the payment of management fees in the form of units has the benefit of aligning managers interests with unitholders. However, we do see potential issues going forward if S-REIT managers continue to maintain its current structure of paying a substantial portion of its fees in units. This is because most REITs are trading below their respective NAVs, coupled with a modest DPU growth profile, the continued issuance of new units will have the unintended consequence of eroding NAV per unit and diluting future DPU. In a scenario analysis of S-REITs paying 100% of its fees in cash, we estimate a 0.5 percentage points drop in average sector yields to 6.5%, which is not all that bad, given that adjusted yield spreads of 4.3% remain above historical average. S-REITs that are least affected in our scenario analysis are A-REIT, CMT, MINT, SGREIT, MLT, PREIT and KDC REIT which are already paying a substantial portion of their fees in cash. STI : 2, Analyst Derek Tan derektan@dbs.com Mervin Song CFA mervinsong@dbs.com Singapore Research Team STOCKS Price Mkt Cap Target Price Performance (%) S$ US$m S$ 3 mth 12 mth Rating Mapletree Greater 4 1, (10.2) (17.2) BUY China Commercial Trust Frasers Centrepoint , (5.2) BUY Trust Ascendas REIT , (2.4) BUY CapitaLand Retail (3.9) (17.9) BUY China Trust Mapletree Logistics Trust , (5.0) (21.9) BUY S-REITs still attractive after adjusting for management fees to be paid in cash Adjusted Sector* Sector Healthcare Industrial Hospitality Mixed Commercial Retail Office 2.2% 2.2% 2.2% 2.2% 2.2% 2.2% 2.2% 2.2% 10 year Singapore bond Yield Spread 4.3% 4.3% 3.9% 4.8% 5.2% 4.7% 5.4% 4.8% 6.1% 6.5% 6.5% 7.0% 6.9% 7.0% *Assuming 100% of management fees are paid in cash instead of units Source: Bloomberg Finance L..P., DBS Bank 7.6% 7.4% ed-th / sa- JC

2 Peer Comparisons (17 February 2016) REIT FYE Price Rec Target Price Total Return Mkt Cap (S$) (S$) (%) S$'m FY15 /16F DPU Yield(%) DPU Growth FY16 /17F FY17 /18F FY15 /16F FY16 /17F FY17 /18F FY15-17F P/Bk 16/17F Office CCT Dec 1.38 BUY % 4, % 6.4% 6.5% 2.4% 0.78 FCOT Sep 1 BUY % % 8.2% 8.4% 0.79 KREIT Dec 0.91 BUY 3 21% 2, % 7.3% 7.3% -0.9% 4 OUECT Dec 6 HOLD 5 7% % 7.2% 7.0% 2.5% % 7.0% 7.0% % 0.73 Retail CRCT Dec 1.38 BUY % 1, % 8.1% 2.5% 0 CMT Dec 2.09 BUY % 7, % 5.7% 5.8% 3.5% 9 CRT Jun 0.79 HOLD 6 19% % 9.4% 8.9% -0.7% 8 FCT Sep 1.92 BUY % 1, % 6.2% 6.4% 2.5% 2 SPH REIT Aug 0.92 HOLD % 2, % 6.2% 1.7% % 6.1% 6.2% 2.8% 3 Commercial MCT Mar 1.41 BUY % 2, % 6.2% 3.9% 1.14 MAGIC Mar 4 BUY % 2, % 9.2% 9.3% 3.7% 0.72 SGREIT Dec 0.74 BUY 4 21% 1, % 7.2% 7.5% 4.1% 1 Suntec Dec 1.62 HOLD % 4, % 6.2% 6.5% 2.5% % 6.9% 7.2% 3.4% 7 Industrial a-itrust Mar 7 BUY % % 7.0% 7.9% 10.5% 9 A-REIT Mar 2.34 BUY % 6, % 6.6% 6.6% 1.8% 1.13 Cache Dec 3 BUY % % 10.1% 10.3% -0.1% 0.94 CREIT Dec 0.51 HOLD 1 31% % 9.5% 9.6% 0.7% 0.75 MINT Mar 1.55 BUY % 2, % 7.2% 7.5% 2.9% 1.19 MLT Mar 0.95 BUY % 2, % 8.2% 8.5% 3.6% 0.92 SBREIT Dec 0.71 BUY 4 27% % 8.8% 8.9% -1.5% 9 7.3% 7.4% 7.6% 2.5% 8 Hospitality ASCHT Mar BUY % % 7.5% 7.5% % 1.10 ART Dec BUY % 1, % 7.5% 7.5% 1.9% 0.79 CDREIT Dec 85 BUY % 1, % 7.5% 7.5% -1.8% 1 FEHT Dec 45 HOLD 3 5% 1, % 6.6% 6.3% -6.2% 7 FHT Sep BUY 3 17% 1, % 7.7% 7.7% -2.8% 9 OUEHT Dec BUY % % 8.7% 8.7% -1.4% 5 7.7% 7.6% 7.5% -1.4% 0.70 Healthcare P-Life Dec 2.25 BUY % 1, % 5.4% 5.4% -4.2% 1.33 RHT Mar 0.94 HOLD % % 8.6% 9.3% 9.0% 2 6.6% 6.5% 6.8% % 2 Others IREIT Dec 8 BUY % % 9.3% 9.3% 4.1% 9 KDCREIT Dec 2 BUY % % 6.8% 7.3% 13.1% 1.10 Sector Average 6.8% 7.0% 7.1% 2.2% 0.95 (x) Page 2

3 S-REITs outperforms given market volatility Singapore REIT performance vs STI and Developers S-REITs outperforming developers index by c.15% since start of the year Singapore Developers /01/ /04/ /07/ /10/ /01/ /04/ /07/ /10/ /01/2016 Remarks Yield support ensures that S-REITs outperform developers by c.15% since the start of the year. Expect S-REIT outperformance to continue should market volatility persist. We turn more cautious if the S-REITs prices continue to firm higher (i.e. yield spreads tighten further), making the sector less attractive, given the medium term outlook for rising interest rates. Source: Source: Bloomberg Finance L.P., Companies, DBS Bank Yield Spread currently at an attractive 4.8% Remarks 1 1 Jan-03 Aug-03 Mar-04 Oct-04 May-05 Dec-05 Jul-06 Feb-07 Sep-07 Apr-08 Nov-08 Jun-09 Jan-10 Aug-10 Mar-11 Oct-11 May-12 Dec-12 Jul-13 Feb-14 Sep-14 Apr-15 Nov-15 Sector Yield spread Mean Yield Spread +1 SD -1 SD Average yield of 7.0% approaching Euro crisis lows of 7.4%. With 10-year spot bond yields of 2.1%, the current yield spread stands at an attractive 4.8%. This is above the 10-year and 5-year yield spreads of 3.8% and 4.1% respectively. Using a normalised 3% 10-year bond yield, the yield spread stands at which is close to average yield spread of 4.1% since Source: Bloomberg Finance L.P., Companies, DBS Bank Page 3

4 S-REITs 4Q15 results summary 4Q15 results Summary Reporting < Operating Statistics > <----- F inancial Statistics -----> REIT Rev enues % Chg % Chg NPI % Chg % Chg Gearing NA V % Chg DPU % Chg % Chg FY (S$mio) (y-o-y) (q-o-q) (S$mio) (y-o-y) (q-o-q) (%) (S$) (y-o-y) (q-o-q) Scts (y-o-y) (q-o-q) Office CCT 4Q % -1% % -1% 30% % 1% % 1% FCOT 1Q % 6% % 7% 36% % 0% % 0% KREIT 4Q % 1% % 4% 39% % 4% % -1% OUECT 4Q % 96% % 91% 40% % 4% 6-3% 24% Suntec 4Q % 2% % 7% 36% % 3% % 9% Retail/Mixed CRCT 4Q % 2% % 0% 28% % 2% % -2% CMT 4Q % 12% % 11% 35% % 2% % -3% CRT 2Q16 2, % 21% 1, % 11% 46% % -6% % -9% FCT 1Q % -1% % 6% 28% % 0% % 1% MCT 3Q % 3% % 3% 36% 4 6% 0% % 3% MAGIC 3Q % 4% % 4% 41% % -2% % 3% SPHREIT 1Q % 2% % 6% 26% % -1% % -4% SGREIT 2Q % -2% % 0% 36% 9-4% 1% % 1% Industrial AIT 3Q % 3% % 5% 28% 4 7% -2% % -11% AREIT 3Q % 6% % 15% 37% % 0% % -5% Cache 4Q % 4% % 2% 40% 8-10% -9% % -3% CREIT 4Q % 0% % -1% 37% 7-1% 0% % -5% MINT 3Q % 1% % 1% 29% % 0% % 1% MLT 3Q % 2% % 2% 39% 0 4% 0% % 1% SBREIT 4Q % -1% % -2% 36% 0 0% 0% % -1% Hospitality ASCHT 3Q % 1% % 4% 38% % -3% % 5% ART 4Q % 5% % 3% 39% % -1% % -4% CDREIT 4Q % 22% % 14% 36% % 0% % 28% FHT 1Q % 2% % 3% 39% 6 0% 0% % 4% OUEHT 4Q % 1% % 0% 42% % 0% % -1% Healthcare PREIT 4Q % 1% % 1% 35% % 0% % 0% \ RHT 3Q % -2% % -26% 22% % -4% % -2% Others KDCREIT 4Q % -4% % 2% 29% 9 2% 3% % 0% Page 4

5 Subsector highlights Singapore retail REITs remain resilient thus far 50% Rental reversions (y-o-y) 40% 30% 20% 10% 0% -10% CMT FCT MCT - Vivo City 10% Tenant Sales (y-o-y) 8% 6% 4% 2% 0% -2% -4% -6% Remarks Despite known headwinds such as Singaporeans travelling overseas, threat from e- commerce and slowing economy, Singapore Retail REITs with suburban malls continue to post positive rental reversions and recorded an improvement in tenant sales in 4Q15. 2% y-o-y average DPU growth, second highest after the office sector. Cautious outlook commentary from CMT. Rental reversions to slow further with risk of negative rental reversions. CMT MCT - Vivo City Source: Bloomberg Finance L.P., Companies, DBS Bank Page 5

6 Office REITs posting highest DPU growth but boosted by capital distributions Remarks % 7% 2% 2% 1% 1% 1% 1% CCT FCOT KREIT Suntec Underlying 4Q15 DPU growth Headline 4Q15 DPU growth 5.2% DPU growth for the office sector. Healthy growth from KREIT (+11.3%) and Suntec (6.7%), offset by modest performance from CCT (+0.9%) and FCOT (+2%). Excluding capital distribution y-o-y DPU growth for KREIT and Suntec would have been +% and +0.9% respectively. Positive rental reversions achieved over 4Q15 but risk of negative rental reversions should Grade A office rents continue to drop. Source: Bloomberg Finance L.P., Companies, DBS Bank Diverging occupancy trends between large and mid cap industrial REITs Remarks 99% 97% 95% 93% 91% 89% 87% 85% 102% 100% 98% 96% 94% 92% Large cap industrial REITs - Occupancy level Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 AREIT MINT MLT Mid cap industrial REITs - Occupancy level Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 AIMS AMP Cache Cambridge Soilbuild Portfolio occupancy for the large-cap industrial REITs (AREIT, MINT and MLT) have largely been stable or rising over In contrast, the mid-cap industrial REITs (AIMS AMP, Cache, Cambridge and Soilbuild), occupancies have been dipping, albeit from already high levels. Given high occupancy levels, we expect greater impact on DPU for the mid-cap industrial REITs should vacancies rise. Source: Bloomberg Finance L.P., Companies, DBS Bank Page 6

7 Hospitality Reits - Weakness in RevPAR continue to persists in Singapore* Remarks S$ RevPAR Operating conditions remain challenging in the Singapore hospitality market with 4Q16 RevPAR for various REITs down 7-14% y-o-y. Going into 2016, RevPAR should continue to be under pressure to the 6% increase in hotel room supply Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 ART SG Serviced Residence CDREIT SG Hotel FEHT SG Hotel FEHT SG Serviced Residence FHT SG blended OUEHT SG Hotel Industry Average * RevPAR for industry average is for Oct-Nov15. FEHT has yet to release their 4Q15 results. Source: Bloomberg Finance L.P., Companies, DBS Bank Gearing ratios creaping up Remarks Median gearing creeping up to 36.3% from 33.8% at end-december Weak capital markets constrained the ability of REITs to raise equity to fund acquisitions. REITs have turned to debt-funded acquisitions to support growth plans. Source: Bloomberg Finance L.P., Companies, DBS Bank Median gearing (%) Average gearing (%) Page 7

8 Move towards more sustainable yields S-REIT managers should consider a higher proportion of fees in cash Most S-REITs still pay a substantial portion of management fees in units. One of the key drivers of enhancing distribution yields has been the payment of management fees in units. As of 4Q15, we estimate that S-REITs are still paying a substantial portion of its fees in units. Based on our estimates, this has boosted yields by %. While we believe the issuance of new units in consideration for management fees aligns the interest of the manager with unitholders, given that most S-REITs are currently trading below book coupled with a subdued organic growth outlook, the issuance of these fees dilutes yields and NAV per unit. A change in fee structure might be positive. In order to maintain sustainable dividend levels, we believe that S-REIT managers may have to consider tweaking their fee payout ratios towards a higher percentage in cash over time. This should provide the REITs with greater flexibility to maintain absolute level of DPU should the REIT undertake major AEIs/redevelopments which may negatively impact underlying distributable income. Assuming a change in payout ratio structure, S-REITs that are least affected in our scenario analysis is A-REIT, CMT, MINT, SGREIT, MLT, PREIT and KDC REIT. Management fee in units REIT Share price Market Cap FY16/ 17F P/Bk DPU FY16/ 17F Adjusted DPU FY16/17F FY16/ 17F yield Adjusted FY16/17F Yield* Yield differential % management fees that are paid in units Fee units % of 4Q15 distributable income (S$) S$'bn (x) Scts (%) (%) (%) (%) (%) (%) Office CCT , % 6.3% 0.1% 27% 2% FCOT % 0.2% 23% 3% KREIT , % 5.6% 1.7% 100% 24% OUECT % 6.2% % 100% 14% Suntec , % 5.4% % 74% 13% Retail/Mixed CRCT , % 0.5% 47% 6% CMT , % 5.7% 0% 0% CRT % 8.1% 1.3% 88% 14% FCT , % 0.2% 20% 3% MCT , % 0.3% 50% 6% MAGIC 4 2, % % 100% 13% SPHREIT , % 0.7% 100% 11% SGREIT , % 7.2% 0% 0% Industrials AIT % 6.5% 0.5% 51% 8% AREIT , % 6.4% 0.2% 11% 2% Cache % 9.3% % 75% 8% CREIT % 9.5% 0% 0% MINT , % 7.1% 0.1% 8% 1% MLT , % 8.2% 0% 0% SBREIT % 7.6% 1.3% 100% 14% Hospitality ASCHT % 7.0% 0.4% 50% 6% ART , % 6.6% % 73% 13% CDREIT 85 1, % 6.9% % 79% 8% FHT , % 7.0% 0.7% 100% 9% OUEHT % 7.6% % 100% 12% Healthcare PREIT , % 5.4% 0% 0% RHT % 8.1% 0.4% 50% 5% Others KDCREIT % 6.8% 2% 0% Sector % 6.5% * Scenario assuming that 100% of the management fees are paid in cash vs units Page 8

9 Valuation Charts Page 9

10 Charts S-REIT (Yield and Price to Book) Ascendas Hospitality Trust Historical Yield Spread ASHT Yield Spread ASHT Yield Mean Ascendas Hospitality Trust Historical P/BV ASHT P/BV Mean +1 SD -1 SD Ascendas REIT Historical Yield Spread AREIT Yield Spread AREIT Yield Mean Yield Ascendas India Trust Historical Yield Spread AIT Yield Spread AIT Yield Mean Yield Ascendas REIT Historical P/BV AREIT P/BV Mean +1 SD -1 SD Ascendas India Trust Historical P/BV AIT P/BV Mean +1 SD -1 SD Page 10

11 Ascott REIT Historical Yield Spread 25.0% % 1 5.0% Ascott Yield Spread Ascott Yield Mean Yield CapitaMall Trust Historical Yield Spread Ascott REIT Historical P/BV Ascott P/BV Mean +1 SD -1 SD CapitaMall Trust Historical P/BV CMT Yield Spread CMT Yield Mean Yield CMT P/BV Mean +1 SD -1 SD CapitaCommercial Trust Historical Yield Spread 25.0% % 1 5.0% % CCT Yield Spread CCT Yield Mean Yield CapitaCommercial Trust Historical P/BV CCT P/BV Mean +1 SD -1 SD Page 11

12 CapitaRetail China Trust Historical Yield Spread CRCT Yield Spread CRCT Yield Mean Yield CDL Hospitality Trust Historical Yield Spread 25.0% % 1 5.0% % CDREIT Yield Spread CDREIT Yield Mean Yield CapitaRetail China Trust Historical P/BV CRCT P/BV Mean +1 SD -1 SD CDL Hospitality Trust Historical P/BV CDREIT P/BV Mean +1 SD -1 SD Cambridge REIT Historical Yield Spread 35.0% % % 1 5.0% CREIT Yield Spread CREIT Yield Mean Yield Cambridge REIT Historical P/BV CREIT P/BV Mean +1 SD -1 SD Page 12

13 Cache Historical Yield Spread Cache Yield Spread Cache Yield Mean Yield Croesus Retail Trust Historical Yield Spread Far East Hospitality Trust Historical Yield Spread 7.0% 5.0% 3.0% % Croesus Yield Spread Mean Yield +1 SD Croesus Yield -1 SD FEHT Yield Spread FEHT Yield Mean Cache Historical P/BV Cache P/BV Mean +1 SD -1 SD Croesus Retail Trust Historical P/BV Croesus P/BV Mean +1 SD -1 SD Far East Hospitality Trust Historical P/BV FEHT P/BV Mean +1 SD -1 SD Page 13

14 Frasers Commercial Trust Historical Yield Spread FCOT Yield Spread FCOT Yield Mean Frasers Centrepoint Trust Historical Yield Spread FCT Yield Spread FCT Yield Mean Yield K-REIT Historical Yield Spread 25.0% % 1 5.0% % KREIT Yield Spread KREIT Yield Mean Yield Frasers Commercial Trust Historical P/BV FCOT P/BV Mean +1 SD -1 SD Frasers Centrepoint Trust Historical P/BV FCT P/BV Mean +1 SD -1 SD K-REIT Historical P/BV KREIT P/BV Mean +1 SD -1 SD Page 14

15 Mapletree Industrial Trust Historical Yield Spread 7.0% 5.0% 3.0% % Mapletree Logistic Trust Historical Yield Spread MINT Yield Spread MCT Yield Mean Yield Mapletree Commercial Trust Historical Yield Spread 7.0% 5.0% 3.0% % MLT Yield Spread MLT Yield Mean Yield MCT Yield Spread MCT Yield Mean Yield Mapletree Industrial Trust Historical P/BV MINT P/BV Mean +1 SD -1 SD Mapletree Logistic Trust Historical P/BV MLT P/BV Mean +1 SD -1 SD Mapletree Commercial Trust Historical P/BV MCT P/BV Mean +1 SD -1 SD Page 15

16 Mapletree Greater China Commercial Trust Historical Yield Spread 9.0% 7.0% 5.0% 3.0% Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 MAGIC Yield Spread MAGIC Yield Mean OUE Hospitality Trust Historical Yield Spread 1 Mar-16 Mapletree Greater China Commercial Trust Historical P/BV MAGIC P/BV Mean +1 SD -1 SD OUE Hospitality TrustHistorical P/BV OUEHT Yield Spread OUEHT Yield Mean Yield Parkway Life REIT Historical Yield Spread OUEHT P/BV Mean +1 SD -1 SD Parkway Life REIT Historical P/BV PREIT Yield Spread PREIT Yield Mean PREIT P/BV Mean +1 SD -1 SD Page 16

17 Religare Health Trust Historical Yield Spread 1 1 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 RHT Yield Spread RHT Yield Mean Yield Soilbuild Business Space REIT Historical Yield Spread 1 9.0% 7.0% 5.0% 3.0% % Religare Health Trust Historical P/BV Dec-2012 Feb-2013 Apr-2013 Jun-2013 Aug-2013 Oct-2013 Dec-2013 Feb-2014 Apr-2014 Jun-2014 Aug-2014 Oct-2014 Dec-2014 Feb-2015 Apr-2015 Jun-2015 Aug-2015 Oct-2015 Dec-2015 Feb-2016 RHT P/BV Mean Soilbuild Business Space REIT Historical P/BV SBREIT Yield Spread SBREIT Yield Mean Yield SPH REIT Historical Yield Spread 7.0% 5.0% 3.0% % SPH REIT Yield Spread SPH REIT Yield Mean Yield -1 SD SBREIT P/BV Mean +1 SD -1 SD SPH REIT Historical P/BV SPH REIT P/BV Mean +1 SD -1 SD Page 17

18 Starhill Global REIT Historical Yield Spread SGREIT Yield Spread SGREIT Yield Mean Yield Starhill Global REIT Historical P/BV SGREIT P/BV Mean +1 SD -1 SD Suntec REIT Historical Yield Spread 25.0% % 1 5.0% Suntec Yield Spread Suntec Yield Mean Suntec REIT Historical P/BV Suntec P/BV Mean +1 SD -1 SD Page 18

19 Appendix Page 19

20 Singapore REITS List Bloomberg Code Acronyms Company Description AIT SP Equity a-itrust Ascendas India Trust Ascendas India Trust ("a-itrust") was listed in August 2007 as the first Indian property trust in Asia. Its principal objective is to own income-producing real estate used primarily as business space in India. a- itrust may also develop and acquire land or uncompleted developments to be used primarily as business space, with the objective of holding the properties upon completion. a-itrust is managed by Ascendas Property Fund Trustee Pte Ltd, a subsidiary of the Ascendas Group. AREIT SP Equity A-REIT Ascendas REIT Ascendas Real Estate Investment Trust (A-REIT) is a property trust constituted by a trust deed. A-REIT owns and invests in a diverse, income-producing portfolio of business park (including science park), light industrial, hi-tech industrial and logistic properties in Singapore. ASCHT SP Equity ASCHT Ascendas Hospitality Trust A-HTRUST is a stapled group comprising Ascendas Hospitality Business Trust (A-HBT) and Ascendas Hospitality REIT (A-HREIT), established to invest in a diversified portfolio of hotel assets in Asia, Australia and New Zealand. ART SP Equity ART Ascott Residence Trust Ascott REIT's Investment portfolio primarily comprises real estate used mainly as serviced residences or rental housing properties (including investments in real estate-related assets and/or other related valueenhancing assets or instruments). CACHE SP Equity Cache Cache Logistics Trust Cache is a REIT which invests primarity in logistics properties located in the Pan Pacific region. It currently owns 13 assets in Singapore and China. CREIT SP Equity CREIT Cambridge Industrial Trust Cambridge Industrial Trust is a real estate investment trust which invests primarily in income-producing industrial assets located in Singapore. CCT SP Equity CCT CapitaLand Commercial Trust CapitaCommercial Trust (CCT) is a real investment trust investing exclusively in commercial properties in Singapore. CT SP Equity CMT CapitaLand Mall Trust CapitaMall Trust is a real estate investment trust which owns and invests in retail properties in the suburban areas and downtown core of Singapore. CRCT SP Equity CRCT CapitaLand Retail China Trust CapitaChina Retail Trust is a real estate investment trust which invests in income-producing retail properties located mainly in China, Hong Kong and Macau. CDREIT SP Equity CDREIT CDL Hospitality Trusts CDL Hospitality Trusts is a stapled group comprising H- REIT and HBT. H-REIT is a real estate investment trust that invests in a portfolio of income-producing hospitality related properties and HBT is a business trust. FCOT SP Equity FCOT Frasers Commercial Trust Frasers Commercial Trust is a real estate investment trust that invests in income-producing commercial office properties in Singapore and Australia. As of 30th Sept 2014, FCOT s portfolio is worth an aggregate S$1.8bn. 66% of its assets are derived from its properties in Singapore and the remainder 34% from Australia. FHT SP Equity FHT Frasers Hospitality Trust FHT is a hospitality stapled group comprising FH-REIT and FH-BT. FH-REIT is a S'pore based REIT which invests in hospitality assets. FH-BT is a S'pore based business trust which will be dormant as of the Listing Date. FHT operates 13 mid and upper scale hotels and serviced residences in key gateway cities located in Singapore, Japan, UK, Australia, Malaysia and Japan. Source: DBS Bank Page 20

21 Bloomberg Code Acronyms Company Description IREIT SP Equity IREIT IREIT Global IREIT is a Singapore REIT established with the investment strategy of principally investing, directly or indirectly, in a portfolio of income-producing real estate in Europe which is used primarily for office purposes. KDCREIT SP Equity Keppel DC REIT Keppel DC Reit Keppel DC REIT is a Singapore-based real estate investment trust ( REIT ), established with the principal investment strategy of investing, directly or indirectly, in a portfolio of incomeproducing real estate assets which are used primarily for data centre purposes, with an initial focus on Asia Pacific and Europe. KREIT SP Equity K-REIT Keppel REIT K-REIT is a real estate investment trust investing in predominantly commercial properties in Singapore and key gateway cities in Australia. It currently owns 10 commercial Grade A office assets. MCT SP Equity MCT Mapletree Commercial Trust Mapletree Commercial Trust is a real estate investment trust that invests in income-producing office and retail properties in Singapore. A majority of its earnings is derived from Vivocity, which is the largest retail mall in Singapore, and is located at the gateway of Sentosa. MAGIC SP Equity MAGIC Mapletree Greater China Commercial Trust MGCCT is a Singapore real estate investment trust (REIT) established with the investment strategy of principally investing, directly or indirectly, in a diversified portfolio of income-producing commercial real estate in the Greater China region. MINT SP Equity MINT Mapletree Industrial Trust Mapletree Industrial Trust is a real estate investment trust which invests primarity in income producing industrial assets located in Singapore. Its portfolio includes a diverse mix of business parks, science parks, ramp-up warehouses and flatted factories. MLT SP Equity MLT Mapletree Logistics Trust MapleTree Logistics is a real estate investment trust which invests in logistics warehouses in the Asia Pacific region. It currently owns warehouses in Singapore, Japan, China, South Korea, Vietnam and Hong Kong. OUECT SP Equity OUE CT OUE Commercial REIT OUE Commercial REIT (OUE CT) is an office REIT with a portfolio of office assets in located in prime CBD locations in Singapore and China. OUEHT SP equity OUEHT OUE Hospitality Trust OUE H-Trust is a Singapore-based REIT established with the principal investment strategy of investing, directly or indirectly, in a portfolio of incomeproducing hospitality assets. PREIT SP Equity Plife REIT Parkway Life Reit Parkway Life REIT is one of Asia's largest listed healthcare REITs. It invests in income-producing real estate and real estate-related assets used primarily for healthcare and healthcare-related purposes. As at 30th Sept 2014, PLife REIT's total portfolio size stood at 47 properties totalling in excess of S$1.5 billion. Source: DBS Bank Page 21

22 Bloomberg Code Acronyms Company Description RHT SP Equity RHT Religare Health Trust Religare Health Trust (RHT) is structured as a business trust, comprising healthcare assets in India. Its investment mandate is to principally invest in medical and healthcare assets in India, Australasia and emerging markets. It is backed by Fortis Healthcare, a leading healthcare services provider in India and with more than 10 years of operating experience. Its portfolio valued at S$857m is comprised of 12 clinical establishments, 4 greenfiled clinical establishments and 2 operating hospitals managed by RHT. RHT s properties are located across 10 Indian states with total build-up area of c.3.6m sq ft. SBREIT SP Equity SBREIT Soilbuild Business Space REIT Soilbuild Business Space REIT is a real estate investment trust that invests in income-producing real estate used primarily for business space purposes in Singapore. Its flagship asset is Solaris, located in the one-north business park. The REIT is backed by Soilbuild Group, a household name in the construction and real estate business in Singapore. SPHREIT SP Equity SPH REIT SPH REIT SPH REIT is a real estate investment trust that invests in income-producing retail malls in Singapore. It currently owns the Paragon Mall within the Orchard Road district, as well as Clementi Mall, located in the west of Singapore. SGREIT SP Equity SGREIT YTL Starhilll Global REIT Starhill Global REIT is a real estate investment trust that invests in income-producing upscale retail and/or office assets in the Asia Pacific region. In Singapore, it owns portions of Ngee Ann City and Wisma Atria. It also owns assets in China, Japan, Malaysia and Australia. SUN SP Equity Suntec REIT Suntec REIT Suntec REIT is has a portfolio of office and retail properties in Singapore and Australia. Its most prominent asset is Suntec City, which comprises of 5 office towers and a retail mall located close to the city area of Singapore. Source: DBS Bank Page 22 Appendix

23 DBS Bank recommendations are based an Absolute Total Return* Rating system, defined as follows: STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame) BUY (>15% total return over the next 12 months for small caps, >10% for large caps) HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps) FULLY VALUED (negative total return i.e. > -10% over the next 12 months) SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame) Share price appreciation + dividends GENERAL DISCLOSURE/DISCLAIMER This report is prepared by DBS Bank Ltd This report is solely intended for the clients of DBS Bank Ltd and DBS Vickers Securities (Singapore) Pte Ltd, its respective connected and associated corporations and affiliates (collectively, the DBS Vickers Group ) only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of DBS Bank Ltd. The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBS Bank Ltd., its respective connected and associated corporations, affiliates and their respective directors, officers, employees and agents (collectively, the DBS Group )) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain separate independent legal or financial advice. The DBS Group accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. The DBS Group, along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. The DBS Group may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company (or companies) referred to in this report. The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as a representation and/or warranty by the DBS Group (and/or any persons associated with the aforesaid entities), that: (a) (b) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments stated therein. Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report. DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research department, has not participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months and does not engage in market-making. ANALYST CERTIFICATION The research analyst(s) primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views. The analyst(s) also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 18 Feb 2016, the analyst(s) and his/her spouse and/or relatives who are financially dependent on the analyst(s), do not hold interests in the securities recommended in this report ( interest includes direct or indirect ownership of securities). Page 23

24 COMPANY-SPECIFIC / REGULATORY DISCLOSURES 1. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd (''DBSVS''), their subsidiaries and/or other affiliates have proprietary positions in CapitaLand Commercial Trust, Frasers Commercial Trust, Keppel REIT, CapitaLand Retail China Trust, CapitaLand Mall Trust, Croesus Retail Trust, Frasers Centrepoint Trust, SPH REIT, Mapletree Commercial Trust, Mapletree Greater China Commercial Trust, YTL Starhill Global REIT, Suntec REIT, Ascendas India Trust, Ascendas REIT, Cache Logistics Trust, Cambridge Industrial Trust,Mapletree Industrial Trust, Mapletree Logistics Trust, Soilbuild Business Space Reit, Ascendas Hospitality Trust, Ascott Residence Trust, CDL Hospitality Trusts, Far East Hospitality Trust, Frasers Hospitality Trust, OUE Hospitality Trust, Parkway Life Real Estate Investment Trust, Keppel DC REITrecommended in this report as of 31 Jan DBS Bank Ltd does not market make in equity securities of the issuer(s) or company(ies) mentioned in this Research Report. 3. DBS Bank Ltd., DBSVS, DBSVUSA, their subsidiaries and/or other affiliates beneficially own a total of 1% of any class of common equity securities of Frasers Commercial Trust, Croesus Retail Trust, Mapletree Greater China Commercial Trust, YTL Starhill Global REIT, Cache Logistics Trust, Soilbuild Business Space Reit, Ascott Residence Trust, Far East Hospitality Trust, Frasers Hospitality Trust, Keppel DC REIT as of 31 Jan DBS Bank Ltd., DBSVS, DBSVUSA, their subsidiaries and/or other affiliates beneficially own a total of 5% of any class of common equity securities of Croesus Retail Trust as of 31 Jan Compensation for investment banking services: DBS Bank Ltd., DBSVS, their subsidiaries and/or other affiliates of DBSVUSA have received compensation, within the past 12 months for investment banking services from Frasers Commercial Trust, Keppel REIT, OUE Commercial REIT, Croesus Retail Trust, Ascendas REIT, Cache Logistics Trust, Soilbuild Business Space Reit, Frasers Hospitality Trust, IREIT Global as of 31 Jan DBS Bank Ltd., DBSVS, their subsidiaries and/or other affiliates of DBSVUSA have managed or co-managed a public offering of securities for Frasers Commercial Trust, Keppel REIT, OUE Commercial REIT, Croesus Retail Trust, Ascendas REIT, Cache Logistics Trust, Soilbuild Business Space Reit, Frasers Hospitality Trust, IREIT Global, Keppel DC REIT in the past 12 months, as of 31 Jan2016. DBSVUSA does not have its own investment banking or research department, nor has it participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively. 6. Directorship/trustee interests: Danny Teoh Leong Kay, a member of DBS Group Holdings Board of Directors, is a Director of CapitaMalls Trust Mgmt Ltd as of 28 Feb Woo Foong Pheng (Mrs Ow Foong Pheng), a member of DBS Group Holdings Board of Directors, is a Director of Mapletree Greater China as of 28 Feb RESTRICTIONS ON DISTRIBUTION General This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. Australia Hong Kong Indonesia This report is being distributed in Australia by DBS Bank Ltd. ( DBS ) or DBS Vickers Securities (Singapore) Pte Ltd ( DBSVS ), both of which are exempted from the requirement to hold an Australian Financial Services Licence under the Corporation Act 2001 ( CA ) in respect of financial services provided to the recipients. Both DBS and DBSVS are regulated by the Monetary Authority of Singapore under the laws of Singapore, which differ from Australian laws. Distribution of this report is intended only for wholesale investors within the meaning of the CA. This report is being distributed in Hong Kong by DBS Vickers (Hong Kong) Limited which is licensed and regulated by the Hong Kong Securities and Futures Commission. This report is being distributed in Indonesia by PT DBS Vickers Securities Indonesia. Page 24

25 Malaysia This report is distributed in Malaysia by AllianceDBS Research Sdn Bhd ("ADBSR"). Recipients of this report, received from ADBSR are to contact the undersigned at in respect of any matters arising from or in connection with this report. In addition to the General Disclosure/Disclaimer found at the preceding page, recipients of this report are advised that ADBSR (the preparer of this report), its holding company Alliance Investment Bank Berhad, their respective connected and associated corporations, affiliates, their directors, officers, employees, agents and parties related or associated with any of them may have positions in, and may effect transactions in the securities mentioned herein and may also perform or seek to perform broking, investment banking/corporate advisory and other services for the subject companies. They may also have received compensation and/or seek to obtain compensation for broking, investment banking/corporate advisory and other services from the subject companies. Wong Ming Tek, Executive Director, ADBSR Singapore Thailand United Kingdom Dubai United States Other jurisdictions This report is distributed in Singapore by DBS Bank Ltd (Company Regn. No E) or DBSVS (Company Regn No G), both of which are Exempt Financial Advisers as defined in the Financial Advisers Act and regulated by the Monetary Authority of Singapore. DBS Bank Ltd and/or DBSVS, may distribute reports produced by its respective foreign entities, affiliates or other foreign research houses pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, DBS Bank Ltd accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact DBS Bank Ltd at for matters arising from, or in connection with the report. This report is being distributed in Thailand by DBS Vickers Securities (Thailand) Co Ltd. Research reports distributed are only intended for institutional clients only and no other person may act upon it. This report is being distributed in the UK by DBS Vickers Securities (UK) Ltd, who is an authorised person in the meaning of the Financial Services and Markets Act and is regulated by The Financial Conduct Authority. Research distributed in the UK is intended only for institutional clients. This research report is being distributed in The Dubai International Financial Centre ( DIFC ) by DBS Bank Ltd., (DIFC Branch) having its office at PO Box , 3 rd Floor, Building 3, East Wing, Gate Precinct, Dubai International Financial Centre (DIFC), Dubai, United Arab Emirates. DBS Bank Ltd., (DIFC Branch) is regulated by The Dubai Financial Services Authority. This research report is intended only for professional clients (as defined in the DFSA rulebook) and no other person may act upon it. This report was prepared by DBS Bank Ltd. DBSVUSA did not participate in its preparation. The research analyst(s) named on this report are not registered as research analysts with FINRA and are not associated persons of DBSVUSA. The research analyst(s) are not subject to FINRA Rule 2241 restrictions on analyst compensation, communications with a subject company, public appearances and trading securities held by a research analyst. This report is being distributed in the United States by DBSVUSA, which accepts responsibility for its contents. This report may only be distributed to Major U.S. Institutional Investors (as defined in SEC Rule 15a-6) and to such other institutional investors and qualified persons as DBSVUSA may authorize. Any U.S. person receiving this report who wishes to effect transactions in any securities referred to herein should contact DBSVUSA directly and not its affiliate. In any other jurisdictions, except if otherwise restricted by laws or regulations, this report is intended only for qualified, professional, institutional or sophisticated investors as defined in the laws and regulations of such jurisdictions. DBS Bank Ltd 12 Marina Boulevard, Marina Bay Financial Centre Tower 3 Singapore Tel Company Regn. No E Page 25