Frasers Property Thailand Industrial Freehold & Leasehold REIT - - PowerPoint PPT Presentation

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Frasers Property Thailand Industrial Freehold & Leasehold REIT

4QFY19 and FY2019 Results Presentation

13 November 2019

FPIT Bangplee 1, Samutprakarn Laemchabang 2, Chonburi, Thailand (FPIT’s properties)

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Important notice

This presentation is for information purposes only and does not constitute or form part of an offer, solicitation, recommendation or invitation for the sale or purchase

• r subscription of securities, including units in Frasers Property Thailand Industrial Freehold & Leasehold REIT (“FTREIT”, and the units in FTREIT, the “Units”) or

any other securities of FTREIT. No part of it nor the fact of its presentation shall form the basis of or be relied upon connection with any investment decision, contract or commitment whatsoever. The past performance of FTREIT and Frasers Property Industrial REIT Management (Thailand) Company Limited, as the REIT manger of FTREIT (the “Manager”), is not necessarily indicative of the future performance of FTREIT and the Manager. This presentation may contains “forward-looking statements”, including forward-looking financial information, that involve assumptions, known and unknown risks, uncertainties and other factors which may cause the actual results, performance, outcomes or achievements of FTREIT or the Manger, or industry results, to be materially different from those expressed in such forward-looking statements and financial information. Such forward-looking statements and financial information are based on certain assumptions and expectations of future events regarding FTREIT’s present and future business strategies and the environment in which FTREIT will operate. The Manager does not guarantee that these assumptions and expectations are accurate or will be realized. The Manager does not assume any responsibilities to amend, modify or revise any forward-looking statement, on the basis of any subsequent developments, information or events, or otherwise, subject to compliance with all applicable laws and regulations and/or the rules of the Securities and Exchange Commission, Thailand (“SEC”) and the Stock Exchange of Thailand (“SET”) and/or any other regulatory or supervisory body or agency The information and opinions in this presentation are subject to change without notice, its accuracy is not guaranteed and it may not contain all material information concerning FTREIT. None of FPT, FTREIT, the Manager, or any of their respective holding companies, subsidiaries, affiliates, associated undertaking or controlling persons, or any of their respective directors, officers, partners, employees, agents, representatives, advisers or legal advisers makes any representation or warranty, express or implied, as to the accuracy, completeness or correctness of the information contained in this presentation or otherwise made available or as to the reasonableness of any assumption contained herein or therein, and any liability whatsoever (in negligence or otherwise) for any loss howsoever arising, whether directly or indirectly, from any use, reliance or distribution of this presentation or its contents or otherwise arising in connection with this presentation is expressly disclaimed. Further, nothing in this presentation should be construed as constitution legal, business, tax or financial advice. The value of Units and the income derived from them, if any, may fall or rise. Unit are not obligations of deposits of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in the Units is subject to investment risks, including the possible loss of the principal amount invested. Investors should note that they have no right to request the Manager to redeem their Units are listed. It is intended that holders of Units may only deal in their Units through trading on SET. Listing of the Units on the SET does not guarantee a liquid market for the Units. Please study relevant information carefully before making any investment decision. Investors are encouraged to make an investment only when such decision correspond with their own objective and only after they have acknowledged all risks and have been informed that the returns may be more or less than initial sum.

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Content

▪ 4QFY19 Highlight and FY2019 ▪ Financial Review ▪ Portfolio Overview ▪ REIT Strategy and Key Objectives

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4QFY19 and FY2019 Highlights

FPIT Bangna FPT Properties Chonburi

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4QFY19 Highlights

Distributable

Income

Portfolio

Metrics

Acquisition Capital Management

• 4QFY19 Distribution Per Unit (“DPU”) of THB 0.1670 per unit, up 4.4% from 3QFY18(6), maintain

DPU compared to 3QFY19.

• Higher Occupancy rate at 83.1%, up from 79.2% at 3QFY2018 (Sep’18).
• Weighted average lease expiry at around 2.33 years(3)
• 155,058 sq m of forward renewals, representing 9.2% of portfolio net leasable area, renewal

rate is around 92%

(1) Gearing ratio = IBD/TAV as of 30 September 2019 (2) Only Debentures cost = 3.3% WAM is around 4.2 Years (3) By Gross Rental income (4) Retention and reversion that incurred in 4QFY2019 (5) FPIT properties value is THB 637 Million (Exclude acquisition expenses and Tax) and CTD cold storage value is THB 657 Million (Exclude acquisition expenses and Tax) (Value of CTD property including VAT is THB 661 Million), CTD will transfer remaining equipment after CTD clearing VAT and documents with Customs, transfer schedule will not late than 31 January 2020 (Value of properties including VAT is THB 1,298 Million) (6) 3QFY18 was period from 1 July 2018 to 30 September 2018 (7) Based leased area that CTD have lease agreement with FTREIT

• Acquired 18,354 sq.m(7) (1 properties) of cold storage from CT Distribution Center in August 2019
• Acquired 29,850 sq.m

(2 properties) of warehouses from FPIT in September 2019

• Total investment value of 3 properties is THB 1,294 Million(5)
• Gearing of 25.3%
• 86.6% of borrowings at fixed interest rate
• Weighted average cost of debt is around 3.2% p.a
• Weighted average debt maturity is around 3.8 years

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Growth continues in FY2019 THB 0.6680

FY2019 DPU(5)

• FY2019 Occupancy rate end at 83.1%, up from 79.2% at end of FY2018

(+3.9% y-o-y)

• Renewal Rate is around 86%(2)/ Rental rate reversion is around 1.6%(2)

❖ Portfolio Management ❖ Earnings and DPU ❖ Portfolio value increased to THB 37 Billion

• FY2019 DPU of THB 0.6680, up 4.7% year-on-year

THB 0.1670

• THB 3,201 Million(3) acquisition properties from sponsor and third-party
• Completed asset enhancement plan (extend building area by 1,700 sq.m) of

a factory at Amata City Rayong, increased asset value by THB 41 Million.

• Divested 2 properties at Amata City Chonburi province and Rojana Industrial

Park Prachinburi at attractive premium to book values

THB 3.2 Billion

Asset Acquisition FY2019

83.1%

Occupancy Rate as

• f 30 September

2019

(1) Reference from loan agreement and debentures at the end of Sep 19. (2) Retention rate and rental rate reversion that incurred in FY2019 (Oct’18 – Sep’19) (3) FPIT properties value is THB 2,544 Million (Exclude acquisition expenses) and CTD cold storage value is THB 657 Million (Exclude acquisition expenses and Tax) (Value of CTD property included VAT is THB 661 Million), CTD will transfer remaining equipment after CTD clearing VAT and documents with Customs, transfer schedule will not late than 31 January 2020 (Value of properties including VAT is THB 3,205 Million) (4) Only Debentures cost = 3.3% WAM is around 4.2 Years (5) DPU of 4QFY19 at THB 0.1670

❖ Capital Management

• LTV ratio at 25.3% as of 30 September 2019, maintained weighted

average cost of debt at around 3.2%(4) and average weighted debt maturity 3.8 years(4) .

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Financial review

FPT Properties Chonburi

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0.1600 0.1670 3QFY18 4QFY19

Distribution 4QFY19 and FY2019

Unit : THB per Unit

1. Distribution = Dividend + Capital Reduction 2. FY2019 period start from 1 October 2018 to 30 September 2019, FY2018 start from 1 January 2018 to 30 September 2018. 3. DPU of performance 1 Month Oct’17 was THB 0.0481.

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▪ The higher DPU of THB 0.6680 by 4.7% year-on-year was mainly to contribution from new assets acquisition and better performance of existing assets. ▪ Distribution date is on 11 December 2019 Distribution per Units(2)

0.6381 0.6680 Oct'17-Sep'18 Oct'18-Sep'19

12 Months 12 Months

(1) (1)(3)

(Jul’18 – Sep’18) (Jul’19 – Sep’19)

4QFY17 to 3QFY18 FY2019

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Financial Performance for Year ended 30 September 2019

Unit: (THB Million) Oct’18 – Sep’19 (FY19)(2) Oct’17 – Sep’18 (4QFY17 – 3QFY19)(6) +/- % Analysis

Rental and Service Income 2,745.5 2,124.3 29

• Contribution from the FY2019 Sponsor assets acquisition value of THB 2,544 Million in

Dec’18 and Sep’19 and the third party assets acquisition value of THB 657 Million(1) in Aug’19.

• FY2019 Occupancy rate end at 83.1%, up from 79.2% at end of FY2018 (+3.9% y-o-y).
• 1.6% Rental rate reversion.

Cost of rental and Services and administration expenses 394.0 349.2 13

• Cost increased from acquired CTD property that REIT paid 50% of transfer fee, special

business tax and registration fee. In addition, REIT paid advisors fee of sponsor and third party asset acquisition project.

• Cost increase from new assets in period FY18/19.

Trust Management fee(4) 372.7 288.6 29

• In 4QFY17, PFPO and FTREIT incurred advisors fee to support conversion that lead overall

expense higher expenses in FY19. Registrar fee reduced due to merger of PFPOs into FTREIT. Finance Costs 271.3 152.1 78

• Higher borrowing cost to finance acquisition in Aug’18 and FY2019.
• The weighted average interest rate as of Sep’19 was 3.2% per annum and Weighted

average debt maturity is around 3.8 years. Net Investment Income 1,739.2 1,321.9 32 DPU (THB per Unit) 0.6680(5) 0.6381(3)(7) 5

• Higher distribution per unit came from better performance of FY2019 compared to 4QFY17 –

3QFY18

(1) CTD cold storage value is THB 657 Million (Exclude acquisition expenses and Tax) (Value of CTD property included VAT is THB 661 Million), CTD will transfer remaining equipment after CTD clearing VAT and documents with Customs, transfer schedule will not late than 31 January 2020 (2) FY2019 period start from 1 October 2018 to 30 September 2019, FY2018 start from 1 January 2018 to 30 September 2018. (3) Distributable income for performance on Oct’17 is around 0.0481, Nov’17 – Dec’17 = 0.1100, 1QFY18 = 0.1600, 2QFY18 = 0.1600 and 3QFY18 = 0.1600 (4) Trust management fee = Management fee + Trustee fee + Registrar fee + Professional fee (5) DPU at THB 0.1670 which required REIT to top up payment from retained earning as of 30 Sep 2019 (6) Reference from Notes to financial statement note 22 (“Supplementary informations”) (7) Included capital reduction.

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Balance Sheet

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Unit: (THB Million) As of 30 Sep 19 As of 30 Sep 18 Change % Investment Properties 37,049.4 33,987.4 9.0 Investment in Securities at fair value and cash 1,141.8 1,137.9 0.3 Other Assets 305.5 307.9 (0.8) Total Assets 38,496.7 35,433.3 8.6 Interest Bearing Debt 9,742.0 6,933.0 40.5 Other liabilities 1,265.5 1,138.3 11.2 Total Liabilities 11,007.5 8,071.3 36.4 Net Asset Value per Unit (THB) 10.5630 10.5141 0.5 ▪ The value of investment properties increased 9% from THB 33,987 Million as at 30 September 2018 to THB 37,049 Million at 30 September 2019, due mainly to: Investment ✓ Completed acquisition of asset from sponsor on 19 December 2018 and 20 September 2019; ✓ Completed acquisition of asset from third-party on 28 August 2019 ; ✓ Completed asset enhancement plan (extend building area by 1,700 sq.m) on 16 January 2019 ; Divestment ✓ Divested of 1 unit of factory at Amata City Chonburi on 1 November 2018 ✓ Divested of 1 unit of warehouse at Rojana Industrial Park Prachinburi on 26 November 2018 ▪ Interest bearing debt increased THB 2,809 Million, to fund asset acquisition in the fiscal period(1).

1. This amount is net increased from financing new properties, repaid loan and refinanced short term loan by issued debentures in period.

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Capital Management

As at 30 September 2019 IBD to Total Asset Value (LTV%) 25.3% Total Gross Borrowings THB 9,742 million Weighted Average Cost of Borrowings 3.2% p.a Average Weighted Debt Maturity 3.8 Years Interest Rate Exposure Fixed 87% Interest Coverage Ratio for 4QFY19/12MFY19 7.74 times/ 8.73 times/1 Credit Rating A (Stable Outlook)/2 Debt Maturity Profile/3

Bridging Loan Debentures

Interest Fixed/Float

87% 13%

Unit: THB Million Fixed Float

1. Interest Coverage ratio = EBITDA (excluded gain from divestment)/Interest Expense. 2. Official announcement rating by TRIS on 3 May 2019. 3. Fiscal year ending 30 September. 4. Refinanced by issuance new units on Jan’20.

800 2,100 1,300 500 1,000 380 500 1,260 600 1,302 (4) FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 FY2028 FY2029 2,102

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Investment in period Portfolio Overview

Frasers logistic Bangna, Chachoengsao, Thailand

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Growth from Acquisition in FY2019

• In FY2019, FTREIT has acquired assets from Sponsor and Third-party.
• Total investment value is THB 3,201 million(1) and Net leasable area (NLA) for new assets = 120,979 SQ.M (40 Units).
• Assets are located in 6 provinces (Chonburi, Rayong, Samutprakarn, Ayutthaya, Pathumthani and Prachinburi), 11

locations which are strategic locations for industrial and logistic hubs in Thailand.

Investment Highlight and asset performance as of 30 September 2019

NLA OCR% Quality tenants

120,979 SQ.M.

100%(2) 18

Total Inv Value

THB 3,201 Million(1)

Located in

6 Provinces 11 Locations

Tenants

Logistics Electronics Automotive Others

(1) FPIT properties value is THB 2,544 Million (Exclude acquisition expenses) and CTD cold storage value is THB 657 Million (Exclude acquisition expenses and Tax) (Value of CTD property included VAT is THB 661 Million), CTD will transfer remaining equipment after CTD clearing VAT and documents with Customs, transfer schedule will not late than 31 January 2020 (Value of properties including VAT is THB 3,205 Million) (2) Included guarantee rental and service income (occupancy rate excluded guarantee is around 95%)

100% Freehold

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Completion of Asset Enhancement Initiative

Project Completed on 16 January 2019

WALE for AEI Area

+1,700 sqm 14,250 sqm

Internal External

Height Floor Loading

AEI Specification

3 Tons 7 Meters

AEI Area

1,700 sqm

Total Area After AEI 15,950 sqm

7 Years

• Board of REIT Manager has approved/1 for the expansion area

1,700 SQ.M of factory unit AAA14.2 at Amata City Rayong/2.

• This investment shall increase rental income generated from the

expansion area

1. Board approved on 14 May 2018 2. Start rent extension area on 1 Feb 2019, NLA increased from 14,250 SQ.M to 15,950 SQ.M), WALE 7 Years

• 3. NOI Yield% = Net operating income / Investment value.

Utilized Area of Assets

NOI Yield 10.17%/3

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Divestment of factory and warehouse

• Divested 1 unit of factory at Amata City Chonburi province to MIC Industry/3 on 1 Nov 2018 and
• Divested 1 unit of warehouse at Rojana Industrial Park Prachinburi to Siam Nistrans/4 on 26 Nov 2018
• Sales price was above around 23% of initial purchase price/1
• Net gain from divestment of THB 52 million/2 over investment cost
• Asset had been vacant around 1 Year (for WH)
• Factory ages is around 22 years and warehouse ages is around 4 years (on divestment date)

1.Assets were original FTREIT properties, investment cost is THB 223 million 2.Excluding acquisition expense. 3.MIC Industry is electronics parts producer (air conditioner, electronics panel) 4.Siam Nistrans is Ground/Air/Maritime logistics provider

THB 275 million

A1.75 W1 RP1 AMN

Sales Considerations Investment cost

THB 223 million

Gain/5

THB 52 million

• [Gain over investment

cost = 23%]

5.Gain from divestment in PL= Sales considerations – investment cost

Gain from divestment Reduce Expenses from holding

• f unoccupied

assets

=

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Freehold 74% Leasehold 26% Factory47% Warehouse 53%

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FTREIT Portfolio Snapshot as of 30 September 2019

Quality portfolio concentrated within major industrial and logistics markets

554

Properties/1 WALE/4

2.33 Yrs ~THB 37.0 bn

Portfolio Value/2

Avg Property Ages/5

~10 Years ~1.68 million sq m

Net Leasable Area/3

Occupancy Rate

83.1%

Frasers Property Thailand Industrial Freehold & Leasehold REIT

FTREIT listed real-estate investment trust with a quality portfolio concentrated within prime industrial and logistics market in Thailand. Remaining LH Years

~ 25 Years

No of Tenants

264

Geographically diversified, Type

• f assets and

predominantly freehold or long leasehold

North 26% East 14% EEC 60%

Type

• f Assets

Breakdown By Area

1. Factory 315 units and Warehouse 239 units (included Cold Storage 2 units)

• 2. Value of Factory THB 19,278 million (52%) and value of warehouse THB 17,771 million (48%)
• 3. Area of Factory 789,660 sq.m (47%) and area of warehouse 888,815 sq.m (53%) – total 1,678,475 sq.m

4. WALE refers to the weighted average lease expiry based on gross rental income (GRI), being the contracted rental income and estimated recoverable outgoings for the month of September 2019. Excludes straight lining rental adjustments.

• 5. Factory avg ages around 12 years and Warehouse around ages 7 years

The Largest Industrial & Logistics REIT in Thailand

Breakdown By Right on assets

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Macroeconomic and Industry Update 4QFY19 (Jul’19 – Sep’19)

Thailand Economy Industry Outlook

(Only FTREIT’s tenant industry)

2019 GDP Annual Growth Rate expected at averaged 2.7% to 3.2% that dropped from 4.1% on 2018 Key Drivers (+):

• Key driver of 2019 onward shall be from government spending in infrastructure mega project
• Plan to scale up infrastructure to bring in private investors and enhance global competitiveness (Thailand 4.0 Initiatives – EEC / Digital focus)

Key Concerns (-):

• Trade war between US and other countries (EU, China and others) has been fully effected to Thailand that heavily rely on export sector. Value of

export was decreased 4.0% in 1Q and 4.2% in 2Q and expected overall decreased around 4.0% - 5.0% in this year and expected continue to maintain or decreased in next year

(+) Expansion

Automotive

Export value

• f

automotive spare part and engine increased around 1.0%

Electronics

Export value

• f

electronics appliances increased 10.6%

Retail and E-Commerce

• Traditional retail maintain

grown around 5%

• E-commerce grown

around 10%

(-) Deceleration

Logistics

• Overall growth rate decreased

from 5% to 3% in this period.

• Land: growth 3% (-3% Q-o-Q)
• Air : growth 1% (-2% Q-o-Q)
• Sea : growth 1.5% (-2% Q-o-Q)

Note: Net add is not include new properties that came from acquisition in FY2019 Macroeconomic and industry information reference from NESDB, factory and warehouse business reference from independent appraisers.

Factory/ Warehouses

for rent Business

Ready Built Warehouse Market

Supply (+) ❖ Total supply increased by 67,814 square meters to a total of 5,299,476 square meters ❖ Future supply from 1H 2019 to 2H 2019 is expected to slightly change mainly from sell off, expansion and contraction some part of warehouse Demand (+) ❖ Net occupied space slightly increased by 2,518 square meters to a total

• f 4,353,459 square meters

❖ The market occupancy rate decreased slightly to 82.1% from 83.2% Average Gross Rent Overall Average (asking) rental rate is 148 baht per square meters per month

Ready Built Factory Market

Supply (Slightly +) ❖ Total supply increased only 10,180 square meters to a total of 2,927,805 square meters ❖ Future supply from 2H 2018 to 1H 2019 is expected to remain the same Demand (Slightly +) ❖ Net occupied space increased by 49,294 square meters to a total of 2,299,857 square meters ❖ The market occupancy rate increased slightly to 78.6% from 77.1% Average Gross Rent Overall Average (asking) rental rate is 189 baht per square meters per month

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Summary Performance of FY2019

Northern Bangkok Area/2 Eastern Bangkok Area /2 EEC Area /2

67% 68% 69% 77% 75% 69%

71%

0% 20% 40% 60% 80% 100%

Mar'18 Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19

59 Units

92% 92% 96% 99% 100% 99% 0% 20% 40% 60% 80% 100%

Mar'18 Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19

82% 80% 80% 84% 82% 83%

85%

0% 20% 40% 60% 80% 100%

Mar'18 Jun'18 Sep'18 Dec'18 Mar'19 Jun'19 Sep'19

Overall performance of FTREIT FY2019 is improve from last fiscal year that came from tenants of existing assets and new assets

100%

• 1. Reference from Note to financial statement, Note 22, supplementary informations, Rental Revenue included property tax income.
• 2. Vacant unit in this area has already been occupied by new tenant

Occupancy (%)

as of 30/9/19

Net Add (sq.m)

FY2019

WALE (Years)

Rate as of 30/9/19

Rent Revenue FY2019(1)

Renewal Rate

FY2019

Rate Reversion

FY2019

83.1%

(+3.9%)

+152,587 2.33 Years

(+0.12Y)

2,745 MB

(+29.2%)

86% +1.6%

152 Units 343 Units

OCR % OCR % OCR %

• Performance improve from existing properties and

invested in CTD Cold storage, It improve overall WALE of Northern Bangkok area from around 1.71 years to 2 years. Majority demand came from Electronics sector (Electronics IC board)

• Performance slightly improve from end of FY18. It

came from new tenants in electronics sectors and retail sector.

• Sales can increase rental rate in eastern Bangkok

area in same trend of market

• Occupancy rate at Sep’19 drop from Jun’19 around

1% came from guarantee expired on Aug’19 for 1 unit in Bangplee location(2)

• No significant movement of occupancy rate in this area

since occupancy rate is 99%.

• The best area performance of FTREIT, Sales team can

improve by increasing rental rate at least 1.5% - 2.0% p.a since high demand but supply limit in this area.

• Significant Improve from asset acquisition and existing

proeprties in 4QFY19. New assets located in Laemchabang 2 and Sriracha ,net leaeable area 29,850 sq.m,fully occupied 100%

• Customers relocate from China to set up production

plant in Thailand to evade trade war effect.

Summary highlight Q-o-Q Summary highlight FY2019 Summary highlight Q-o-Q Summary highlight FY2019 Summary highlight Q-o-Q Summary highlight FY2019

• Infrastructures projects in EEC area have significant

progress such as LCB Phase 3 and high speed train linking between 3 airports thus It shall boost demand

• f factory and warehouse in this area.

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Tenants Industry % of GRI(1) Nationality Siam Makro Retail 4.37% Leschaco Logistics 2.59% CTD Logistics 2.00% Lazada E-Commerce 1.94% BJC Logistics Logistics 1.89% Samsung Electronics 1.77% DTS Automotive 1.53% Kintetsu Logistics 1.45% DHL Logistics 1.44% Global Architectural Other 1.41%

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Well-diversified Tenant Base

High quality, diversified tenant base underpinned by primary industries including Automotive, logistics services, electronics, retails and e-commerce. Top 10 Tenants (GRI ~20%(2) / WALE 3.15Years(1))

Breakdown of Tenants1 2 By Industry

Automotive 26%

Logistics 25% Electronics 22% Others 16% Retails 8% E-Commerce 3% By Nationality

Japan 46% EU 21% Thais 15% Other Asian 14% US 4%

1. WALE refers to the weighted average lease expiry based on gross rental income (GRI), being the contracted rental income and estimated recoverable outgoings for the month of September 2019. Excludes straight lining rental adjustments. 2. Concentration risk has stable at around 20%.

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FY2019 Key Take Away

THB 1,793 million/1

Distributable Income

1. Distributable income = adjusted net investment income. 2. Divested 1 factory at Amata City Chonburi and 1 Warehouse at Rojana Industrial Park Prachinburi. 3. As of 30 September 2019

• 4. FPIT properties value is THB 2,544 Million (Exclude acquisition expenses) and CTD cold storage value is THB 657 Million (Exclude acquisition expenses and Tax)

(Value of CTD property included VAT is THB 661 Million), CTD will transfer remaining equipment after CTD clearing VAT and documents with Customs, transfer schedule will not late than 31 January 2020 (Value of properties including VAT is THB 3,205 Million)

83%/2.33 Yrs/3

Occupancy and WALE

Higher occupancy rate

THB 3,201 million/4

Investment in period

Portfolio value increased to approximately THB 37 bn

THB 275 million

Divestment value

At significant premium to book value/2

3.8 Years(3)

Weighted Avg Debt Maturity

87%(3)

Proportion of Fixed Debt

25.3%(3)

Aggregate leverage Retention/Reversion

86%/+1.6%

[12MFY2019]

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FTREIT Strategy

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Principal Objective and Strategy

Active Asset Management

Active Asset Management

Strategies to support the Principal Objective

1

Investment Growth

2 ▪ Proactive leasing: Maintain high retention rate,

• ccupancy rate, and well- diversified tenant base.

▪ Asset Enhancement Initiative (AEI): Assess and undertake AEI on the FTREIT portfolio to unlock further value. ▪ ROFR/1 for industrial properties from FPT’s Sponsor. ▪ Third-party asset acquisition.

1. Right of first refusal

Capital Management

3 ▪ Optimize capital mix and prudent capital management. ▪ Manage schedule of debt repayment matching with asset portfolio performance

Deliver Consistent growth and sustainable distributions to unitholders

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