16
PERENNIAL REAL ESTATE HOLDINGS LIMITED
Annual Report 2015
LETTER TO SHAREHOLDERS
Dear Shareholders,
We are pleased to share with you the inaugural Annual
Report for Perennial Real Estate Holdings Limited
(“
Perennial
”).
The 14-month
1
period of our business (“
Period
”) has
not only been fruitful, but marked a key turning point
for Perennial as we set a new vision and took steps to
position ourselves to become a leading global integrated
real estate and healthcare company.
Within a short time, we have established a strong reputation
as a diversified real estate company with a presence in
Singapore, China, Malaysia and Ghana, with Singapore
and China as our core markets, and have invested in and
are managing 10 large-scale integrated developments and
five retail and commercial developments spanning over
45 million square feet (“
sq ft
”) in total gross floor area (“
GFA
”).
In Singapore, our ability to increase the net lettable area
(“
NLA
”) at CHIJMES, TripleOne Somerset and AXA Tower
is a testament to our forte in identifying existing buildings
with embedded value, and the creation of significant
value through the execution of asset enhancement works
and repositioning exercises. The accomplishment of the
extensive works at CHIJMES and Capitol Singapore,
both encompassing heritage components, has also
raised Perennial’s profile as a real estate specialist for
complex conservation projects. We now have a strong
and entrenched foothold in Singapore with six quality
properties, all of which are located within the Central
Business District (“
CBD
”), Civic District or Orchard Road
precinct, and directly connected or in close proximity to
mass rapid transit stations.
In China, our standing as a leading commercial developer
of sizeable integrated developments which are close
to transportation hubs is gaining strength, particularly
with the commencement of construction works at our
development projects in Chengdu, Xi’an and Beijing, after
finalising the respective development plans and securing
the necessary regulatory approvals. The completion
of these outstanding development projects, which are
strategically located in first and second-tier provincial
capitals and major cities, will drive Perennial’s net asset
value (“
NAV
”) growth in the next few years.
Whilst focusing on building our real estate business, we saw
the immense growth opportunity in the China healthcare
market and the potential value which can be harnessed
from the synergy of this future growth driver with our real
estate portfolio. We nimbly extended our business into the
China healthcare industry through the establishment of
joint ventures with reputable players and the repositioning
of some of our assets to align with, and support our
strategic move, marking the start of our exciting integrated
real estate and healthcare business journey.
BUSINESS REVIEW
We remained strategically focused on the core markets
of China and Singapore, with these markets constituting
about 72.6% and 21% of total assets respectively.
Completed projects in Singapore and China, which
accounted for about 63.2% of Perennial’s total property
value (effective stake basis), continued to provide
income stability.
In Singapore, 100% of the portfolio (based on total
attributable GFA in Singapore) is completed and income-
generating, with the residential component of Capitol
Singapore having received its Temporary Occupation Permit
(“
TOP
”) in February 2016.
The China development properties on the other hand
currently contribute only about 28.7% of total property
value (effective stake basis), whilst accounting for about
57% of total attributable GFA. The completion of these
China development projects over time will give impetus
to Perennial’s NAV growth.
SINGAPORE
CHIJMES and Capitol Singapore, which are both heritage
landmark developments right in the heart of Singapore’s
downtown Civic District, have commenced operations
and are making good progress.
1 Perennial completed the reverse takeover of St. James Holdings Limited on 27 October 2014 and the real estate business commenced on 28 October 2014.
The 14-month period of Perennial’s real estate business is for the period from 28 October 2014 to 31 December 2015.
