LIPPO-MAPLETREE - Lippo Malls Indonesia Retail Trust - Investor ...

StrategyThe principal investment strategy of the Manager is owning and investing on a long-term basis in adiversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/orretail-related purposes, and real estate related assets in connection with the foregoing purposes.In accordance with the requirements of the Listing Manual, the Manager’s investment strategy for LMIRTrust will be adhered to for at least three years following the Listing Date, unless otherwise agreed by anExtraordinary Resolution passed at a meeting of Unitholders duly convened and held in accordance withthe provisions of the Trust Deed.The Manager’s key objectives are to deliver regular and stable distributions to Unitholders and to achievelong-term growth in the NAV per Unit in order to provide Unitholders with capital appreciation on theirinvestments. The Manager plans to achieve these objectives through the following strategies:ACQUISITION GROWTH STRATEGYLMIR Trust’s acquisition growth strategy envisages investments in retail and/or retail-related assets thatare in the interests of Unitholders. The assets in LMIR Trust’s initial portfolio are all located in Indonesia.ACTIVE ASSET ENHANCEMENT AND MANAGEMENT STRATEGYImplementing pro-active measures to enhance the returns from the existing and future properties in LMIRTrust’s portfolio. Such measures may include addition and alteration works, including re-zoning, tenancyremixing and work carried out for the purpose of expanding size and capacity and (in relation to propertiesto be acquired by LMIR Trust), leveraging and enhancing the properties’ competitive strengths to optimiserentals and enhancement projects to maintain the competitive positioning of such properties. TheManager intends to work with the relevant Indonesian authorities to gain the necessary approvals toundertake such active asset enhancement works.• As at the Latest Practicable Date, three of the Retail Malls, Bandung Indah Plaza, Mal Lippo Cikarangand Ekalokasari Plaza have recently completed extensive asset enhancement works and a fourth RetailMall, The Plaza Semanggi is currently undergoing asset enhancement works.- Bandung Indah Plaza has recently completed enhancement and renewal works which created anadditional NLA of approximately 3,843 sq m.- Mal Lippo Cikarang has recently completed the building of an extension which has increased the NLAof the mall’s hypermarket and specialty space by 10,694 sq m. As at 30 June 2007, 8,539 sq m orapproximately 79.8% of the additional NLA created from such asset enhancement has been precommittedto Hypermart, one of Indonesia’s leading hypermarket chains.- Ekalokasari Plaza has recently completed asset enhancement works which created an additionalNLA of 5,013 sq m by adding a third floor and a mezzanine floor. This development incorporates a foodcourt, a proposed fitness centre and potentially a cinema as anchor tenants for the top levels of thecentre. These asset enhancement works are expected to improve shopper traffic throughout all levelsof the mall. As at 30 June 2007, 670 sq m or approximately 13.4% of the additional NLA created fromsuch asset enhancement has been pre-committed.- The Plaza Semanggi is undergoing asset enhancement works to include a new alfresco café areacalled the “Plangi on the Sky” café, which will increase NLA by approximately 3,000 sq m by the end of2007.Each of Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza has either obtained, or is in theprocess of obtaining, final local government approval for the recently completed asset enhancementworks which have created additional NLA.CAPITAL AND RISK MANAGEMENT STRATEGYBy the Listing Date, LMIR Trust expects to put in place the Debt Facilities, being a floating rate securedterm loan facility of up to S$350.0 million. While LMIR Trust will not incur any borrowings as at the Listing112