Ascott Residence Trust

Transcription

1 Pursuing Growth Ascott Residence Trust Annual Report 2014

2 Corporate Profile Vision Ascott Residence Trust (Ascott Reit or the Group) was established with the objective of investing primarily in real estate and real estate-related assets which are income-producing and which are used or predominantly used, as serviced residences, rental housing properties and other hospitality assets. Ascott Reit s total assets have more than quadrupled to S$4.1 billion since it was listed on the Singapore Exchange Securities Trading Limited (SGX-ST) in March Ascott Reit s international portfolio comprises 90 properties with 10,502 units in 37 cities across 13 countries in Asia Pacific and Europe. To be the premier serviced residence real estate investment trust with quality assets in key global cities. Mission To deliver stable and sustainable returns to Unitholders. Ascott Reit s serviced residences are operated under the Ascott, Citadines and Somerset brands, and are mainly located in key gateway cities such as Barcelona, Berlin, Brussels, Guangzhou, Hanoi, Ho Chi Minh City, Jakarta, Kuala Lumpur, London, Manila, Munich, Paris, Perth, Shanghai, Singapore and Tokyo. Ascott Reit is managed by Ascott Residence Trust Management Limited (ARTML or the Manager), a wholly-owned subsidiary of The Ascott Limited (Ascott or the Sponsor) and an indirect wholly-owned subsidiary of CapitaLand Limited, one of Asia s largest real estate companies. ARTML is the winner of World Finance Magazine s Best Real Estate Investment Fund Manager 2011 in South Eastern Asia in their inaugural Real Estate Awards. Contents 01 Highlights of Financial Highlights 03 Global Presence 06 Letter to Unitholders 11 Value Creation 15 Trust Structure 16 Board of Directors 25 The Manager 27 Corporate Governance 46 Enterprise Risk Management 49 Our People and the Communities 52 Investor Relations 55 Financial Review 61 Portfolio Overview 64 Operations Review 82 Directory Listing 87 Report of the Trustee 88 Statement by the Manager 89 Independent Auditors Report 90 Statements of Financial Position 91 Statements of Total Return 92 Distribution Statements 94 Statements of Movements in Unitholders Funds 96 Portfolio Statements 120 Consolidated Statement of Cash Flows 122 Notes to the Financial Statements 206 Statistics of Unitholders 208 Interested Person/Party Transactions Corporate Information

3 Pursuing Growth Ascott Reit has strengthened its portfolio through the years by actively acquiring quality assets in key cities around the world. Capitalising on its expertise in asset management and prudent capital management, Ascott Reit has firmly established itself as a leading global serviced residence real estate investment trust (REIT) with a robust portfolio of quality serviced residences spanning 37 cities in 13 countries. The Group stays committed to pursuing growth so as to continue to deliver stable and growing returns to its Unitholders. Highlights of 2014 Revenue S$357.2 million Gross Profit S$180.2 million Total Assets as at 31 December 2014 S$4.1 billion 13% year-on-year 12% year-on-year Unitholders Distribution S$125.6 million 9% year-on-year Largest hospitality REIT listed on SGX-ST Apartment Units Number of Assets Acquired 10,502 9 Most number of acquisitions since the acquisition of European portfolio in 2010 Global Presence 37 cities 13 countries Pursuing Growth 01

4 Financial Highlights For the Financial Year Gross Revenue (S$ million) Gross Profit (S$ million) Unitholders' Distribution (S$ million) Distribution Per Unit (DPU) (cents) Distribution Yield 1 (%) DPU (adjusted for Rights Issue) 2 (cents) Balance Sheet As at 31 December Total Assets (S$ million) 2, , , , ,121.9 Unitholders' Funds (S$ million) 1, , , , ,106.1 Total Borrowings (S$ million) 1, , , , ,550.9 Financial Ratios As at 31 December Net Asset Value (NAV) Per Unit (S$) Aggregate Leverage (%) Interest Cover Ratio 3 (times) Management Expense Ratio 4 (%) Derivative Financial Liabilities as a Percentage of NAV 5 (%) Others As at 31 December Market Capitalisation 1 (S$ million) 1, , , , ,949.5 Number of Units in Issue (million) 1, , , , , Based on the closing unit price of S$1.22 on 31 December 2010, S$0.99 on 31 December 2011, S$1.36 on 31 December 2012, S$1.21 on 31 December 2013 and S$1.27 on 31 December The figures have been restated for the underwritten and renouncable 1-for-5 Rights Issue, through which 253,749,218 units were issued on 12 December Refers to EBITDA (earnings before net interest expense, tax, depreciation and amortisation) before change in fair value of financial derivatives, change in fair value of serviced residence properties and assets held for sale, and unrealised foreign exchange differences over net interest expense. 4 Refers to the expenses of Ascott Residence Trust (excluding direct expenses, foreign exchange differences, net interest expense, change in fair value of financial derivatives, change in fair value of serviced residence properties and assets held for sale, assets written off and income tax expense). 5 Derivative financial liabilities refer to the interest rate swaps and interest rate caps which the Group has entered into. 02 Ascott Residence Trust Annual Report 2014

5 Global Presence Expansion & Diversification Ascott Reit is defined by its vision in being the premier serviced residence real estate investment trust with quality assets in key global cities. Today, our aspirations are evidenced by an international presence of 90 properties across 37 cities in 13 countries. Ascott Raffles Place Singapore Citadines Biyun Shanghai Citadines Suites Louvre Paris Somerset Azabu East Tokyo Ascott Makati Citadines Trafalgar Square London Citadines Ramblas Barcelona Somerset Grand Hanoi Quest Sydney Olympic Park Pursuing Growth 03

6 Global Presence Ascott Reit has established a fine balance between income stability and growth through its extended-stay business model and geographical spread. Total Assets as at 31 December 2014 S$4.1 billion Belgium Brussels Apartment Units United Kingdom London 10,502 Properties 90 Cities France Cannes Grenoble Lille Lyon Marseille Montpellier Paris Spain Barcelona 37 Countries Germany Berlin Hamburg Munich Ascott Residence Trust Annual Report 2014

7 China Beijing Dalian Guangzhou Shanghai Shenyang Suzhou Tianjin Wuhan Xi an Japan Fukuoka Hiroshima Kyoto Saga Sapporo Sendai Tokyo Malaysia Kuala Lumpur Singapore Indonesia Jakarta Philippines Manila Vietnam Hanoi Ho Chi Minh City Australia Perth Greater Sydney Pursuing Growth 05

8 Letter to Unitholders (Left) Lim Jit Poh, Chairman (Right) Tay Boon Hwee, Ronald, Chief Executive Officer Dear Unitholders, 2014 was an active and rewarding year for Ascott Reit. In the year under review, we completed acquisition of nine properties with an aggregate property value of S$559.1 million. Consequently, Ascott Reit s total assets have more than quadrupled to S$4.1 billion from its initial listing total assets of close to S$1.0 billion in March 2006, a compound annual growth rate of 18.1%. As at 31 December 2014, Ascott Reit s portfolio comprises 10,502 apartment units in 90 properties across 37 cities in 13 countries. By total assets, Ascott Reit is the largest hospitality REIT listed on the SGX-ST. Pursuing Growth The swift acquisition of the nine properties in four countries (Australia, China, Japan and Malaysia) in 2014 was Ascott Reit s most exceptional year since its strategic and transformational purchase of the European portfolio four years ago also marked our maiden presence in five new cities: Dalian, Wuhan and Xi an in China, Kuala Lumpur in Malaysia and Greater Sydney in Australia. We also bought for the first time, a prime hotel strategically located in the heart of Shinjuku, Tokyo, with the plan to re-position it as a serviced residence in Through these actions, we have strengthened our presence in the key hospitality markets of China, Japan and Australia and also forayed into Malaysia. These new properties have enhanced the diversification of Ascott Reit s portfolio across regional and economical cycles. Our remarkable expansion trail in 2014 has set us confidently on the right and fast track to achieving our target portfolio size of S$6.0 billion by Out of the nine properties acquired in 2014, five were from third parties, demonstrating our capability in sourcing and executing. While we aggressively capitalise on expansion opportunities, we remain focused and disciplined in the choice of our acquisitions and the key markets. 06 Ascott Residence Trust Annual Report 2014

9 Delivering Stable and Growing Returns While expansion has been in the limelight, Ascott Reit has continued to deliver another commendable set of financial results for FY Total revenue for the year reached S$357.2 million while gross profit was S$180.2 million, representing a year-on-year growth of 13% and 12% respectively. The stronger performance was largely underpinned by the yield accretive acquisitions during the year, as well as stronger operating performance from existing properties. The average occupancy of the Group s portfolio for FY 2014 has remained stable at around 80%. The Group s distribution to Unitholders for FY 2014 grew by 9% year-on-year to reach a record high of S$125.6 million. Distribution per Unit (DPU) for FY 2014 was 8.20 cents, representing an attractive yield of 6.5% based on the closing price of S$1.27 on 31 December Ascott Reit s distribution to Unitholders for the period from initial listing to FY 2014 has achieved a respectable compound annual growth rate of 22.6%. As at 31 December 2014, Ascott Reit s investment properties were valued at S$3,811.4 million by independent valuers, an increase of 16.8% from the previous valuation as at 31 December 2013, attributed by the acquisitions in 2014 and higher valuation from properties in China, United Kingdom, Belgium and Japan. Ascott Reit continues to deliver stable income to its Unitholders through its geographically diversified portfolio across Europe and the Pan-Asian regions, coupled with its extended-stay business model. Close to 50% of the Group s total gross profit in FY 2014 was contributed by master leases and serviced residence management contracts that provide a minimum guaranteed income. Rejuvenating Portfolio to Create Higher Value The Group continues to drive organic operational growth by putting its existing portfolio through robust asset enhancement programmes to optimise returns for the Unitholders and to meet increasingly sophisticated demands of modern travellers. As at 31 December 2014, approximately 80% of Ascott Reit s serviced residence properties have undergone, or are undergoing, Asset Enhancement Initiatives (AEI), with the remaining 20% of the portfolio projected to undergo AEI by A rolling plan has been developed to oversee this aspect of the management. In 2014, approximately S$20.7 million was spent refurbishing several properties in Asia Pacific and Europe. These AEI have yielded both positive feedback and higher returns. Completion of the AEI at Citadines Ramblas Barcelona and Citadines Toison d Or Brussels in 2014 have brought about an uplift of close to 20% in Average Daily Rate (ADR). Somerset Grand Central Dalian, Somerset Olympic Tower Property Tianjin and Somerset Ho Chi Minh City are currently undergoing refurbishment which is on track to be completed in 2015 while the ongoing AEI at Somerset Xu Hui Shanghai is expected to be completed in Our properties, together with our improvement in service delivery, have made us the preferred accommodation for business and leisure travellers alike. Hailed as The Oscars of the Travel Industry, at the World Travel Awards 2014, we clinched the titles of Leading Serviced Apartments for Ascott Jakarta, Ascott Makati, Ascott Raffles Place Singapore, Citadines Sainte-Catherine Brussels, and Citadines Arnulfpark Munich. In addition, Ascott Raffles Place Singapore, our flagship property located in the heart of Singapore s Central Business District, has also clinched the prestigious title as the World s Leading Serviced Apartment. The same property also won the Best Serviced Residence in Asia-Pacific (1st) at the Business Traveller Asia-Pacific Awards Strengthening Capital Position The Group s disciplined approach towards capital and risk management continues to strengthen its strong balance sheet. As at 31 December 2014, Ascott Reit s gearing of 38.5% was well below the Monetary Authority of Singapore s (MAS) Property Fund Appendix s gearing limit of 60.0%. In 2014, our interest cover ratio remained healthy at 4.3 times and average borrowing cost was a low 3.0% per annum with a substantial 80% of the total borrowings of S$1,560.0 million secured at fixed interest rates. As part of the Group s prudent and disciplined approach towards capital management, the Group seeks to diversify funding sources and secures long-term financing at an optimal cost. In August 2014, Ascott Reit tapped the debt capital market by issuing a six-year JPY7.0 billion (approximately S$77.3 million) fixed rate notes at 1.654% per annum. For the first time ever, the Group successfully issued a ten-year Euro-denominated fixed rate notes of EUR80.0 million (approximately S$129.6 million) at 2.75% per annum. Both these Pursuing Growth 07

10 Letter to Unitholders issuances clearly demonstrated the Group s capability to tap long-tenor bonds on an unsecured basis at attractive terms. Through these issuances, we have successfully extended our weighted average debt to maturity to 4.4 years as at 31 December 2014, as compared to 4.2 years for the same period a year ago. In October 2014, the Group made its maiden issuance of S$150.0 million perpetual securities, an alternative form of equity fund raising for Ascott Reit. Proceeds from the issuance of the perpetual securities were deployed swiftly to fund the acquisitions. The issuance has strengthened Ascott Reit s balance sheet and enhanced our financial flexibility to seize growth opportunities to optimise returns for our Unitholders. These fund-raising activities are inevitable as we continue our expansion plans and distribute 100% of our earnings to Unitholders. Where necessary, placing of new units to potential investors will be contemplated as was the case in January 2013 where approximately S$150.0 million was raised through an equity private placement of units. There is also the other possibility of rights issue as was the case in December 2013 where approximately S$253.7 million was raised. The approach is to strike a good balance among the various avenues of fund-raising and the interest of existing and potential Unitholders. In 2014, we undertook a more proactive approach to foreign currency hedging. Given the volatility of certain currencies and their respective outlook for 2014, the Group entered into forward foreign currency hedges on a substantial portion of its expected Unitholders distribution derived in Japanese Yen, Euro and Sterling Pound. We will continue to adopt a proactive approach to mitigate any impact of foreign exchange fluctuations on Unitholders distribution during this period of volatility. Supporting the local communities Corporate social responsibility remains an important and crucial part of our business. This year, together with CapitaLand Hope Foundation, we continued to raise funds for World Vision s Typhoon Haiyan relief and rebuilding operations. A total of PHP88,080 (approximately S$2,500) was raised to support World Vision s Typhoon Haiyan Yolanda relief and rehabilitation efforts which aim to provide emergency shelter and necessities to nearly 400,000 typhoon survivors. In January 2014, staff from properties in Vietnam organised a donation drive comprising a series of fund-raising activities to raise a total of VND60,000,000 (approximately S$3,600) to build dormitories and to improve general living conditions of the less privileged children in Thuy An village in Hanoi, Vietnam. As part of our commitment to conserve the environments in which we operate, we encourage sustainable and environment friendly practices such as water and electricity conservation, waste reduction and recycling efforts by staff and guests alike. Looking Ahead The World Bank and the International Monetary Fund have lowered their global growth forecasts for As such, uncertainty in the European economic recovery and slowdown in the Asian economic growth are expected to continue into Notwithstanding the challenging environment, we expect the performance of Ascott Reit s properties to remain stable. On the back of a well-diversified resilient portfolio, we are confident that Ascott Reit is well-positioned to deliver a steady performance. The Group s income remains strongly supported by assets across 37 cities in 13 countries; while its extended stay business model and properties, underpinned by master leases and serviced residence management contracts with minimum guaranteed income, will continue to provide a strong foundation for stability. We will continue to actively seek accretive acquisitions in key cities of Asia Pacific and Europe and remain focused on enhancing the value of our portfolio and the returns to our Unitholders through the various asset enhancement programmes. We believe Unitholders value can also be further enhanced through active capital recycling and/or asset reconstitution through seizing the right market opportunities. We remain committed to maintaining a strong balance sheet and will continue to stay flexible in our funding sources and structures. 08 Ascott Residence Trust Annual Report 2014

11 致单位持有人之信函 In view of the MAS consultation paper published in October 2014, containing a set of proposal for Singapore s REIT market, the Board and Management have reviewed it and responded through informal discussion sessions as well as formal submission of feedback to MAS. As one of the key industry players, we believe our feedback to MAS would provide a holistic view on the proposed set of regulations. More recently, on 23 February 2015, the Singapore government announced in its budget for FY 2015 to extend the income tax and GST concessions for five years. The GST concession to facilitate fundraising by special purpose vehicles set up by REITs was enhanced as well. We view the extension, especially for foreign-sourced income tax exemption, favourably. However, the stamp duty concessions, which are mainly for the purchase of properties in Singapore, will be allowed to lapse after 31 March Notwithstanding, we do not foresee any material impact on Ascott Reit arising from the removal of stamp duty concessions. Lastly, we wish to extend our appreciation to our fellow Directors and all our staff for their dedication and commitment, without which we would not have been able to deliver these results. We also wish to express our thanks and gratitude to our serviced residence guests, Unitholders and business partners for their continued support. As we continue to expand and deliver higher portfolio performance, we look forward to your continued support, cooperation and understanding. 尊敬的单位持有人, 对于雅诗阁公寓信托而言,2014 财年是令人振奋 硕果累累的一年 回顾过去一年, 我们成功收购了九项物业, 总值高达 亿新元 于此, 雅诗阁公寓信托的资产规模已从 2006 年 3 月上市初期的近 10 亿新元增长到四倍多, 高达 41 亿新元, 年均复增长率高达 18.1% 截至 2014 年 12 月 31 日, 雅诗阁公寓信托的物业组合涵盖 90 个物业,10,502 间公寓单位, 遍布 13 个国家的 37 个城市 就资产规模而论, 雅诗阁公寓信托是在新加坡交易所上市的最大酒店类房地产信托基金 追求增长 2014 年, 雅诗阁公寓信托快速收购了位于四个国家 ( 澳大利亚 中国 日本和马来西亚 ) 的九项物业 这是自四年前收购欧洲资产组合及战略转型以来, 我们在业务拓展上成就最为瞩目的一年 2014 年也标志着雅诗阁公寓信托成功进军五大新城市 : 包括中国的大连 武汉和西安, 马来西亚的吉隆坡以及澳大利亚的大悉尼区 不仅如此, 我们也首次收购位于东京新宿中心黄金地段的一家物业, 并计划在 2015 年把项目重新打造成服务公寓 通过这些举措, 我们成功加强了在中国 日本和澳大利亚各大市场的地位, 同时也把业务版图开拓至马来西亚 这些新收购的项目将能增强雅诗阁公寓信托投资组合在跨区域和经济周期方面的多样化 2014 年业务扩张的卓越成绩, 让我们对实现 2017 年 60 亿新元资产组合的目标充满信心 在 2014 年收购的九项物业中, 有五个项目收购自第三方, 这充分地体现了我们业务拓展与执行能力 在积极把握扩张机会的同时, 我们将继续关注核心市场, 谨慎评估并选择收购的项目 实现稳定增长的利润回报尽管业务扩张引人注目, 雅诗阁公寓信托仍然在 2014 财年继续取得出色的业绩, 全年总收入达 亿新元, 毛利 亿新元, 较去年同期相比分别增长了 13% 和 12% 如此强劲的业绩表现很大程度上归功于该年度一系列增值收购以及现有的物业稳健表现 本集团资产组合 2014 财年平均入住率稳定在 80% 左右 本集团 2014 财年度派发红利比去年同期增长 9%, 达到 亿新元历史新高, 每单位派发红利为 8.20 分 基于 2014 年 12 月 31 日 1.27 新元的收盘价, 雅诗阁公寓信托的派发红利获益率达 6.5% 2014 财年度派发红利较上市初期相比增长达 22.6%, 表现出色 Lim Jit Poh Chairman Tay Boon Hwee, Ronald Chief Executive Officer 25 February 2015 根据独立估值师评估, 截至 2014 年 12 月 31 日, 雅诗阁公寓信托的物业总值达 亿新元, 与截至 2013 年 12 月 31 日的先前估值相比, 同比增长 16.8% 主要因素是 2014 财年新增的项目以及位于中国 英国 比利时和日本的产业增值所至 雅诗阁公寓信托将继续通过其在欧洲和亚太区多元化的投资组合, 以及主攻长住客的经营模式, 为信托单位持有人派发稳定的收益 集团于 2014 财年度取得的总毛利中约 50% 来自主租赁契约和最低营业收入保证的管理合约 优化投资组合, 创造更高价值本集团将继续通过稳健的资产翻新计划, 管理现有的投资组合, 带动业务增长, 从而优化单位持有人的回报, 以及满足当代旅者日益增长的需求 截至 2014 年 12 月 31 日, 雅诗阁公寓信托旗下约 80% 服务式公寓物业都已经完成或正在实施资产翻新计划, 剩余 20% 的物业估计将在 2016 年前展开翻新计划 这方面的资产翻新管理将实施滚动计划 Pursuing Growth 09

12 致单位持有人之信函 2014 年, 本集团投入了约 2070 万新元, 翻新亚太区和欧洲的几项物业 这些翻新计划获得了积极的评价与良好的回报 2014 年翻新工程竣工后, 位于巴塞罗那的兰布拉斯馨乐庭服务公寓 (Citadines Ramblas Barcelona) 与布鲁塞尔的馨乐庭服务公寓 (Citadines Toison d Or Brussels) 平均日租金增加了约 20% 大连盛捷天城服务公寓 天津盛捷奥林匹克大厦服务公寓与胡志明市盛捷服务公寓 (Somerset Ho Chi Minh City) 目前正在进行翻新, 有望在 2015 年完工 同时, 目前也在进行整修的上海徐汇盛捷服务公寓, 也估计能在 2016 年完工 凭借着优质的物业和不断提升的服务品质, 雅诗阁旗下的服务公寓已成为商务和休闲旅客的首选 在被誉为 旅游业的奥斯卡 2014 世界旅游大奖 (World Travel Awards 2014) 颁奖典礼上, 我们的雅加达雅诗阁服务公寓 (Ascott Jakarta), 马尼拉雅诗阁服务公寓 (Ascott Makati), 新加坡雅诗阁莱佛士服务公寓 (Ascott Raffles Place Singapore), 布鲁塞尔的圣凯馨乐庭服务公寓 (Citadines Sainte-Catherine Brussels) 以及慕尼黑馨乐庭服务公寓 (Citadines Arnulfpark Munich) 被授予 领先服务公寓 荣耀 (Leading Serviced Apartment) 此外, 位于新加坡中央商务区的旗舰服务公寓, 雅诗阁莱佛士服务公寓 (Ascott Raffles Place Singapore), 也同时荣获该颁奖项目授予的 世界领先服务公寓 大奖 (World s Leading Serviced Apartment) 于此同时, 该物业也荣获 2014 亚太商旅大奖 (Business Traveller Asia-Pacific Awards 2014) 评选为 亚太最佳服务公寓冠军 (Best Serviced Residence in Asia-Pacific (1st)) 巩固资本地位本集团将继续加强资本和风险管理, 优化其资产负债表 截至 2014 年 12 月 31 日, 雅诗阁公寓信托的资产负债比率为 38.5%, 远低于新加坡金融管理局 (MAS) 房产基金附录所规定的 60.0% 上限 2014 年, 本集团的利息保障倍数维持在 4.3 倍的健康水平, 每年平均借贷成本仅为 3.0%, 15.6 亿新元总贷款中 80% 为固定利率 在一贯坚持资本管理审慎自律的同时, 集团也力求融资渠道多样化, 优化长期融资成本 2014 年 8 月, 雅诗阁公寓信托通过发行六年期固定年利率 1.654% 的债券 70 亿日元 ( 约 7730 万新元 ), 向债务资本市场融资 本集团也首次成功发行十年期欧元计价的固定年利率为 2.75% 的债券, 总值 8000 万欧元 ( 约 亿新元 ) 这些债券的成功发行无疑体现了集团以优厚条件发行无担保长期债券的实力 通过这些债券的发行, 截止至 2014 年 12 月 31 日, 我们已经成功将加权平均债务期限从去年同期的 4.2 年延长至 4.4 年 2014 年 10 月, 本集团首次发行 1.5 亿新元永续债券 这是雅诗阁公寓信托股权集资的另一种形式 发行永续债券的资金被迅速投入收购项目 本次债券发行强化了雅诗阁公寓信托的资产负债表, 提高了财务灵活性, 以便成功把握增长机遇, 优化其单位持有人的回报 鉴于积极拓展业务以及将 100% 盈利返还单位持有人, 融资活动至关重要 正如集团于 2013 年 1 月通过单位股权私募融资约 1.5 亿新元, 以及 2013 年 12 月通过发行股权募集约 亿新元一样, 如有需要, 集团仍会考虑向潜在投资者配售新股 该举措旨在兼顾各种筹款渠道, 并平衡现有与潜在单位持有人之间的利益 2014 年, 我们在外币保值方面采取了更积极的避险措施 根据对某些货币波动的预测, 鉴于日元 欧元和英镑在单位信托派息中所占比例相当大, 集团通过远期汇率对冲, 规避风险 面对这不稳定的市场, 我们将继续采取积极措施, 降低汇率波动对单位持有人派发红利受益的影响 支持当地社区企业社会责任始终是我们经营中不可或缺的重要部分 今年, 我们与凯德希望基金合作, 为世界宣明会倡导的台风海燕救灾重建, 筹集善款 其中, 为约兰达地区的救灾重建共筹得 88,080 菲律宾比索 ( 约 2,500 新元 ), 为近 40 万风灾幸存者提供紧急住所和生活必需品 2014 年 1 月, 越南的员工也组织了一系列募捐活动, 其中一项共筹集 6,000 万越南盾 ( 约 3,600 新元 ), 为河内垂安村 (Thuy An) 兴建民舍, 改善当地弱势儿童总体生活条件 我们坚守环保理念, 鼓励可持续发展, 在员工与顾客中倡导节约水电 减少浪费 资源循环再利用 展望未来世界银行 (The World Bank) 和国际货币基金组织 (International Monetary Fund ) 已下调了 2015 年全球经济增长的预测 欧洲经济复苏前景不明, 以及亚洲经济增长放缓的趋势, 都预计将持续至 2015 年 虽然运营环境充满挑战, 我们预计雅诗阁公寓信托将保持稳定发展 凭借多元化的优质投资组合, 我们有信心, 雅诗阁公寓信托仍将占据有利的竞争优势, 维持良好的业绩 跨越 13 国 37 大城市的资产, 为集团的收益提供了强有力的支持 同时, 专注于长住客的服务公寓商业模式与和旗下的优质物业, 以及主租赁契约和保障最低营业收入的服务公寓管理合同, 将继续为我们的稳健发展提供坚实基础 我们将继续积极寻求在亚太区和欧洲主要城市的增值收购契机, 提升投资组合价值, 并通过各种资产增值计划, 回报单位持有人 我们相信, 通过积极的资本循环和 / 或资产重组, 把握合适的市场机会, 我们将进一步增加单位持有人的投资价值 我们也将继续保持强劲的资产负债表, 并保持资金渠道和融资结构的灵活性 鉴于 2014 年 10 月发布的 MAS 咨文中对新加坡信托基金市场的提议, 董事会和管理层审查并通过非正式讨论, 已正式向 MAS 提交了反馈意见 作为业界主要代表之一, 我们相信这些反馈将为 MAS 即将出台的系列行业法规提供一个全盘视角 新加坡政府于 2015 年 2 月 23 日发布的 2015 财政年预算案中宣布, 将所得税和消费税优惠延长五年, 并将以更完善的消费税优惠机制, 促进房地产投资信托进行某些特定的融资募款 对于这项延长优惠的措施, 特别是继续无须为海外资产的收入缴税优惠, 我们乐见其成, 视为利好 不过, 购买新加坡房产印花税优惠将于 2015 年 3 月 31 日失效 但我们预测此举并不会对雅诗阁公寓信托产生任何重大影响 最后, 我们希望向董事会和全体员工表示衷心的谢意 没有大家的辛勤奉献与敬业精神, 我们不可能取得如此骄人的业绩 我们也希望向服务公寓客户 单位信托持有人及业务伙伴致谢, 感谢大家的长期支持 我们将继续致力于拓展业务, 提高投资组合表现, 并期待您的大力支持 理解和配合 林日波主席 郑文辉总裁 2015 年 2 月 25 日 10 Ascott Residence Trust Annual Report 2014

13 Value Creation We target to deliver stable and growing distributions to Unitholders through the following strategies: Growth by Acquisition Selectively acquiring properties that meet the Manager s investment criteria Active Asset Management Actively managing Ascott Reit s property portfolio to maximise returns from the property portfolio Capital and Risk Management Proactively employing appropriate capital financing and hedging strategies to manage fluctuation risks in interest rates and foreign exchange rates Growth by Acquisition As part of its value creation strategy, Ascott Reit explores investment opportunities globally to enhance the quality of its portfolio. Our primary investment focus is on serviced residences, rental housing and other hospitality assets. As part of our plan to grow a geographically diversified portfolio, our acquisition strategies are set out as follows: Acquisition of assets owned wholly or in part by Ascott Ascott Reit has been granted a right of first refusal in respect of, inter alia, the future sale by any Ascott entity of properties that are used or predominantly used as serviced residences or rental housing properties in the Pan-Asian region and Europe. The Sponsor supports Ascott Reit s acquisition strategy by acquiring, retaining and enhancing assets with good income and growth potential, with the view of subsequently divesting the assets to Ascott Reit at an appropriate time. Acquisition of Ascott s properties under development A number of the Sponsor s properties are currently under development. Upon completion, they offer a pipeline of potential targets for acquisition by Ascott Reit. Acquisition of assets currently managed and/or leased but not owned by Ascott In addition to managing Ascott Reit s portfolio, the Sponsor also operates and/or manages serviced residences owned by third parties. These assets are complementary to Ascott Reit s current portfolio. We will leverage on the Sponsor s knowledge and relationships with the owners of these properties to acquire these assets should such opportunities become available. Acquisition of suitable assets from third party owners not managed and/or leased by the Sponsor Ascott Reit also acquires quality assets from third party owners. Such opportunities arise from: divestment of income-producing assets by third party owners in need of capital for new business expansion or investments; divestment of assets by owners under financial stress; and acquisition of well-located but underperforming assets with the potential for rebranding or asset enhancements for higher returns. Pursuing Growth 11

14 Value Creation Acquisition criteria In evaluating acquisition opportunities, Ascott Reit adopts the following criteria: Yield thresholds Ascott Reit acquires properties or make investments with yields that are currently, or have the potential to be, above their cost of capital. Our acquisitions are expected to enhance returns to Unitholders. Location Ascott Reit evaluates properties in terms of their micro-market locations, accessibility to major roads, public transportation and proximity to amenities. Local market characteristics Ascott Reit acquires properties in markets with positive macro-economic indicators such as strong economic growth and expanding cross border business investments and trade. Key considerations include the levels of Foreign Direct Investment (FDI), business travel (including intra-country business travel), expatriate population and the resulting demand for serviced residences or rental housing properties. Value-creation opportunities Ascott Reit acquires properties with potential for increase in occupancy rates and/or Average Daily Rates (ADR). The potential for value creation through Asset Enhancement Initiatives (AEIs) such as upgrading, refurbishment and reconfiguration is also assessed. Building and facilities specifications Ascott Reit acquires properties that comply with approved building specifications and legal and zoning regulations, with due consideration to the size and age of the buildings. Operator of the serviced residences or rental housing properties Before a serviced residence or rental housing property is considered for acquisition, the operator will be assessed for its track record in delivering stable cash flow and operations, and/or its ability and potential to achieve stable cash flows. Active Asset Management Ascott Reit creates value for its stakeholders by maximising the operating yield of its property portfolio and by focusing on the operational performance of each property. As part of our focused and profit-oriented approach, we benchmark the operating results of each property against market performance and against its previous year s results and planned budgets. We also conduct detailed reviews of properties that are not achieving their targets, and work closely with the Serviced Residence Management Companies (SRMCs) to develop action plans to improve the operating performance of each of these properties. We have put in place robust asset management programmes that enable us to actively manage each of our properties to generate organic growth and strengthen existing relationships with key customers. Through the SRMCs, we seek to optimise occupancy levels and ADR, and maximise RevPAU. As at end of FY 2014, approximately 80% of Ascott Reit s serviced residence properties have undergone, or are undergoing AEI. We closely monitor the growth potential of each property, and divest properties that have reached their maximum potential or whose growth prospects are limited by changes in the operating environment. In 2010, Ascott Reit made its first divestments since its initial listing. The divestment of Ascott Beijing and Country Woods Jakarta unlocked the value of the properties at 66% and 60% above each property s valuation as at 30 June 2010, with net gain of S$98.1 million and S$77.8 million respectively. The proceeds from the divestments were used to partly fund the yield accretive acquisitions of Citadines Mount Sophia Property Singapore, Somerset Hoa Binh Hanoi as well as 26 European properties in France, United Kingdom, Germany, Belgium and Spain. In September 2012, Ascott Reit completed the divestment of Somerset Grand Cairnhill Singapore at 32% above the property s valuation as at 31 December 2011 with a net gain of S$77.8 million. The proceeds from the divestment were deployed into yield accretive acquisitions of Ascott Raffles Place Singapore and Ascott Guangzhou. On 18 October 2013, Ascott Reit announced that it had commenced strata sale for the divestment of 81 units in Somerset Grand Fortune Garden Property Beijing. As at 31 December 2014, we have successfully sold six units to individual buyers while sales for the remaining 75 units are currently ongoing. The divestment will enable Ascott Reit to unlock the underlying value of its units in Somerset Grand Fortune Garden Property Beijing and reconstitute its portfolio. 12 Ascott Residence Trust Annual Report 2014

15 Develop yield management and marketing strategies to maximise RevPAU The profitability of Ascott Reit s portfolio depends primarily on the maximisation of RevPAU. Therefore, our yield management and marketing strategies are focused on: assessing and adjusting apartment rental rates based on occupancy levels and demand; and determining the appropriate balance between higher yielding short-stay guests and stability of revenue from long-stay guests. We work closely with the SRMCs to establish and develop relationships with global key accounts, and leverage on the Sponsor s wider networks to improve Ascott Reit s revenue and profitability. The Sponsor enjoys strong brand equity through a series of marketing initiatives across different platforms. Following enhancements to the Ascott, Citadines and Somerset brand portals, the Sponsor has introduced new features to the existing Ascott corporate booking engine to enhance user experience for contracted corporate clients and travel agents by providing them with easier online access to Ascott properties worldwide. The Sponsor has continued to strengthen its communication efforts with key accounts and preferred partners to improve revenue and profitability. Its 30th Anniversary global promotion generated positive results for the SRMCs and has also created significant brand awareness. The Sponsor has also taken further steps to build a strong online community through attractive provisions for its online members. Aside from enjoying a 10% discount off Best Flexible Rates all year round, Ascott online members are now entitled to additional benefits such as early check-in, late check-out and complimentary upgrades at participating serviced residences when they make their bookings through Ascott The Residence, Citadines Apart hotel or Somerset Serviced Residence websites. The Facebook pages for Ascott The Residence, Citadines Apart hotel and Somerset Serviced Residence have garnered close to 80,000 fans to-date. In addition, the Sponsor has expanded its social media presence with the launch of Pinterest, Instagram as well as WeChat to reach out to more customers. Guests can now make use of the abovementioned social networking platforms, as well as Twitter, YouTube, Flickr and Weibo to stay updated on the latest news, promotions and opening specials. The Sponsor s Global Distribution System (GDS) chain code AZ continues to enable travel management companies and travel agents access rates and room availability more efficiently. Furthermore, the Sponsor has global promotional partnerships with Citibank and other credit card partners in the form of discounts for cardholders. Separately, residents who are Asia Miles members or Singapore Airlines KrisFlyer members can earn mileage for their stays at participating residences. Ascott also partners with CapitaMalls Asia Limited to provide CapitaCard members discounts and privileges when they book and stay at Ascott serviced residences. In addition, the Sponsor recognises that technology innovation is paramount in the face of changing consumer behaviour today. In July 2014, the Sponsor established an Innovation Department to formalise and drive concerted innovation efforts on creating an innovative organisation culture and formalising a digital strategy, amongst other initiatives to capitalise on technology to improve product and service quality. Improve operating efficiencies and economies of scale To minimise direct expenses and increase gross profit margin without compromising our quality of services, Ascott Reit, together with the SRMCs, have identified several areas for cost management. These include: direct marketing to tenants to reduce commission expenses; centralisation of key functions such as finance and procurement for properties located within the same city or region; and bulk purchases by leveraging on Ascott s global portfolio to achieve economies of scale. Create real estate value and maintain quality of portfolio We continuously strive to enhance Ascott Reit s assets through planned periodic upgrading, refurbishment and reconfiguration of the properties in order to achieve a higher level of guest satisfaction as well as to improve the properties performance and competitiveness. The improvement in performance is expected to translate into higher real estate value. Pursuing Growth 13

16 Value Creation Unlocking values As part of our strategy to reconstitute Ascott Reit s portfolio, we monitor closely and evaluate the properties to ascertain if any of them may have reached the optimal stage of their life cycle and should be divested so as to unlock the value of these properties. The proceeds from the divestment can then be redeployed for other purposes, including investing in higher yielding assets. Capital and Risk Management Ascott Reit optimises its capital structure and cost of capital within the borrowing limits set out in the Property Funds Appendix. Either debt or equity or a combination of both is used to fund acquisitions and asset enhancement programmes. Our objectives for capital and risk management are as follows: Maintain strong balance sheet by adopting and maintaining a target gearing range We maintain our gearing at a comfortable range, well within the borrowing limits allowed under the Property Funds Appendix. We balance our cost of capital to optimise returns to Unitholders. Secure diversified funding sources from both financial institutions and capital markets to seize market opportunities To finance acquisitions and refurbishment of properties, we tap into diversified funding sources. These sources include bank borrowings, accessing the debt capital markets through the issuance of bonds and notes and the issuance of perpetual securities, an alternative form of equity. In August 2014, Ascott Reit tapped the debt capital market by issuing a six-year JPY7.0 billion (approximately S$77.3 million) fixed rate notes at 1.654% per annum. For the first time ever, the Group successfully issued a ten-year Euro-denominated bond through the issuance of EUR80.0 million (approximately S$129.6 million) fixed rate notes at 2.75% per annum. Furthermore, Ascott Reit made its maiden issuance of S$150.0 million perpetual securities in October We also seize opportunities to raise additional equity capital through the issuance of units, if there is an appropriate use for such proceeds. Adopt proactive interest rate management strategy We adopt a proactive interest rate management policy by maintaining a target percentage of fixed versus floating interest rates. We also manage risks associated with changes in interest rates on loan facilities while keeping Ascott Reit s ongoing cost of debt competitive. Our interest rate exposure is managed through the use of interest rate caps, interest rate swaps and fixed rate borrowings. Manage exposure to foreign exchange fluctuations Due to the geographical diversity of our portfolio, cash flows generated by our assets as well as their capital values are subject to foreign exchange movements. In managing the currency risks associated with cash flow generated by our assets, we actively monitor foreign exchange rates and enter into hedges, where appropriate. In view of the volatility of certain currencies, we have also taken a proactive approach in 2014 to enter into forward foreign currency contracts to hedge part of Unitholders distribution derived in British Pound, Euro and Japanese Yen. In managing the currency risks associated with the capital values of the overseas assets, our borrowings are made in the same currency as the underlying asset as a natural hedging strategy, to the extent possible. Perform rigorous credit risk management We establish credit limits for customers and monitor their balances on an ongoing basis. For bookings by individuals, payments are usually made upfront and arrears are checked against lease deposits to minimise losses. Corporate bookings are generally given more credit days and we adopt a strict policy of withdrawing credit terms when payments are outstanding to minimise bad debts. Ensure sufficient cash flow to minimise liquidity risk Our approach to managing liquidity is to ensure that we have sufficient liquidity to meet our liabilities when they mature, under both normal and stressed conditions. In addition to credit facilities, we have a S$1.0 billion Multi-currency MTN Programme, which was established in We have also established a US$2.0 billion Euro-MTN Programme in Prepare for market uncertainties The objective of market risk management is to manage and control market risk exposures while optimising returns. Market risk is managed through established investment policies and guidelines. These policies and guidelines are reviewed regularly taking into consideration changes in the overall market environment. 14 Ascott Residence Trust Annual Report 2014

17 Trust Structure Unitholders Holding of Units Distributions Manager Ascott Residence Trust Management Limited Net Profit Management Services Management Fees Acts on behalf of Unitholders Trustee s Fees Trustee DBS Trustee Limited for Unitholders Dividends Ownership of Assets Ownership of Shares Singapore Properties Ascott Raffles Place Singapore Master Lease Master Lease Income Master Lessees Master Lease Master Lease Income Property Holding Companies/ Property Companies Citadines Mount Sophia Property Singapore & Somerset Liang Court Property Singapore Serviced Residence Management Fees Serviced Residence Management Services Serviced Residence Management Companies Serviced Residence Management Fees Serviced Residence Management Services Pursuing Growth 15

18 Board of Directors Lim Jit Poh Chairman & Non-Executive Independent Director 2 Lim Ming Yan Deputy Chairman & Non-Executive Non-Independent Director 3 Tay Boon Hwee, Ronald Chief Executive Officer & Executive Non-Independent Director 4 S. Chandra Das Non-Executive Independent Director 5 Giam Chin Jeremy Giam Non-Executive Independent Director 6 Ku Moon Lun Non-Executive Independent Director 7 Lee Chee Koon Non-Executive Non-Independent Director 8 Zulkifli Bin Baharudin Non-Executive Independent Director 16 Ascott Residence Trust Annual Report 2014

19 Lim Jit Poh, 75 Chairman Non-Executive Independent Director Bachelor of Science in Physics (Honours), University of Singapore Master of Education, University of Oregon, USA Date of first appointment as a director: 20 January 2006 Date of appointment as chairman: 20 January 2006 Length of service as a director (as at 31 December 2014): 8 years 11 months Board committee served on Corporate Disclosure Committee (Chairman) Present directorships in other listed companies ComfortDelGro Corporation Limited (Chairman) SBS Transit Ltd (Chairman) VICOM Ltd (Chairman) Present principal commitment (other than directorships in other listed companies) ComfortDelGro Corporation Limited (Group Chairman) Background and working experience Non-Executive Independent Director of The Ascott Group Limited (From 1999 to 2008) Awards National Trades Union Congress Distinguished Service (Star) Award 2014 Distinguished Service Award in 2000 Meritorious Service Award in 1990 Friend of Labour Award in 1986 Distinguished Science Alumni Award 2006 from the National University of Singapore Government of Singapore Public Administration Medal in 1972 Pursuing Growth 17

20 Board of Directors Lim Ming Yan, 52 Deputy Chairman Non-Executive Non-Independent Director Bachelor of Engineering (Mechanical) and Economics (First Class Honours), University of Birmingham, UK Date of first appointment as a director: 23 July 2009 Date of appointment as deputy chairman: 1 January 2013 Length of service as a director (as at 31 December 2014): 5 years 5 months Board committee served on Executive Committee (Chairman) Present directorships in other listed companies CapitaCommercial Trust Management Limited (manager of CapitaCommercial Trust) (Deputy Chairman) CapitaLand Limited CapitaMall Trust Management Limited (manager of CapitaMall Trust) (Deputy Chairman) CapitaRetail China Trust Management Limited (manager of CapitaRetail China Trust) (Deputy Chairman) Present principal commitments (other than directorships in other listed companies) Building and Construction Authority (Member of the Board) Business China (Director) CapitaLand China Holdings Pte Ltd (Chairman) CapitaLand Hope Foundation (Director) CapitaLand Limited (President & Group CEO) CapitaLand Regional Investments Limited (Chairman) CapitaLand Singapore Limited (Chairman) CapitaMalls Asia Limited 1 (Chairman) CTM Property Trust, Steering Committee (Chairman) LFIE Holding Limited (Co-Chairman) Shanghai YiDian Holding (Group) Company (Director) Singapore-China Foundation Ltd. (Governor) Singapore Tourism Board (Member of the Board) The Ascott Limited (Chairman) Directorship in other listed companies held over the preceding three years Central China Real Estate Limited Background and working experience Chief Operating Officer of CapitaLand Limited (From May 2011 to December 2012) CEO of The Ascott Limited (From July 2009 to February 2012) CEO of CapitaLand China Holdings Pte Ltd (From July 2000 to June 2009) Awards Outstanding Chief Executive (Overseas) at the Singapore Business Awards 2006 Magnolia Award by the Shanghai Municipal Government in 2003 and Delisted on 22 July Ascott Residence Trust Annual Report 2014

21 Tay Boon Hwee, Ronald, 46 Chief Executive Officer Executive Non-Independent Director Bachelor of Business (Honours), Nanyang Technological University Date of first appointment as a director: 1 January 2013 Length of service as a director (as at 31 December 2014): 2 years Board committees served on Corporate Disclosure Committee (Member) Executive Committee (Member) Background and working experience Chief Investment Officer and Managing Director of India and GCC sector of The Ascott Limited (From January 2007 to February 2012) Head of Business Development and Asset Management of Ascott Residence Trust Management Limited (manager of Ascott Residence Trust) (From January 2007 to February 2012) Head and Senior Vice President, Investment of CapitaLand Residential Limited (From July 2001 to December 2006) Pursuing Growth 19

22 Board of Directors S. Chandra Das, 75 Non-Executive Independent Director Bachelor of Arts (Honours), University of Singapore Date of first appointment as a director: 20 January 2006 Length of service as a director (as at 31 December 2014): 8 years 11 months Board committee served on Audit Committee (Member) Present directorships in other listed companies Super Group Ltd TalkMed Group Limited (Chairman) Yeo Hiap Seng Ltd (Deputy Chairman) Present principal commitments (other than directorships in other listed companies) Goodhope Asia Holdings Ltd (Chairman) Nanyang Technological University (Pro-Chancellor) Non-Resident Ambassador to Turkey NUR Investment & Trading Pte Ltd (Managing Director) Tamil Murasu Limited (Chairman) YHS (Singapore) Pte Ltd (Chairman) Directorships in other listed companies held over the preceding three years CapitaMall Trust Management Limited (manager of CapitaMall Trust) Nera Telecommunications Ltd S i2i Limited Sincere Watch Limited Background and working experience Non-Executive Independent Director of The Ascott Group Limited (From 1999 to 2008) Chairman of NTUC Fairprice Co-operative Ltd (From 1993 to 2005) Awards Public Service Star National Day Award in 2014 Distinguished Service (Star) Award by National Trades Union Congress in 2005 President s Medal by the Singapore Australian Business Council in Ascott Residence Trust Annual Report 2014

23 Giam Chin Jeremy Giam, 72 Non-Executive Independent Director Bachelor of Law (Honours), University of Singapore Masters of Law, University of Singapore Advocate & Solicitor Date of first appointment as a director: 23 March 2007 Length of service as a director (as at 31 December 2014): 7 years 9 months Board committee served on Audit Committee (Member) Present directorship in other listed company Mewah International Inc. Present principal commitments (other than directorship in other listed company) Wee Swee Teow & Co (Senior Partner) Non-Resident Ambassador to Peru Singapore Mediation Centre (Director) Directorship in other listed company held over the preceding three years Guthrie GTS Ltd Background and working experience Senior Counsel (Since 1997) President of the Law Society of Singapore (From 1987 to 1989) Magistrate of the Subordinate Courts of Singapore (From 1967 to 1970) Award PBM, Public Service Medal Award in 2012 Pursuing Growth 21

24 Board of Directors Ku Moon Lun, 64 Non-Executive Independent Director Graduated from The Hong Kong Technical College, Hong Kong (now known as The Hong Kong Polytechnic University) Date of first appointment as a director: 20 January 2006 Length of service as a director (as at 31 December 2014): 8 years 11 months Board committee served on Audit Committee (Chairman) Present directorships in other listed companies Kerry Properties Limited Lai Fung Holdings Limited Present principal commitment (other than directorships in other listed companies) Hospital Governing Committee of Tuen Mun Hospital, Hong Kong Hospital Authority (Member) Background and working experience Executive Director of Davis Langdon and Seah International (From 1995 to 2005) Chairman of Davis Langdon and Seah Hong Kong Limited (From 1995 to 2004) Chairman of icfox International (From 2000 to 2003) Chairman of Premas Hong Kong Limited (From 2000 to 2002) Hong Kong Institute of Surveyors (Fellow Member) 22 Ascott Residence Trust Annual Report 2014

25 Lee Chee Koon, 40 Non-Executive Non-Independent Director Bachelor of Science in Mechanical Engineering (First Class Honours), National University of Singapore Master of Science in Mechanical Engineering (Distinction), Imperial College London, UK Date of first appointment as a director: 1 June 2013 Length of service as a director (as at 31 December 2014): 1 year 7 months Board committees served on Corporate Disclosure Committee (Member) Executive Committee (Member) Present principal commitments Ascott International Management (2001) Pte Ltd (Director) Ascott Serviced Residence (China) Fund (Chairman) Somerset Capital Pte Ltd (Director) The Ascott Capital Pte Ltd (Director) The Ascott Holdings Limited (Director) The Ascott Limited (CEO & Director) Background and working experience Deputy CEO, The Ascott Limited (From February 2012 to May 2013) Managing Director, North Asia, The Ascott Limited (From July 2009 to May 2013) Vice President, Office of the President, CapitaLand Limited (From February 2007 to June 2009) Head, International Relations & Economic Strategy, Ministry of Finance (From November 2003 to January 2007) Assistant Director, Ministry of Trade and Industry (From November 2001 to November 2003) Award Top 10 Hoteliers of the Year by China Hotel Starlight Awards in 2010, 2011 and 2012 Pursuing Growth 23