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

CompetitiveStrengths The Properties are located in major cities of Indonesia amidst a growingand affluent urban middle classThe properties are mainly located within Greater Jakarta and Bandung,Indonesia’s fourth most populous city. From 2001 to 2006, total householdexpenditure in Jakarta and Bandung has increased by an average of 12.8%and 11.5% per annum respectively.Retail spending in these cities has been further boosted by a shift in lifestyletowards a higher level of consumerism, partially brought about by the introductionof foreign brands and designer labels. High growth potential from favourable demographics of the IndonesianpopulationThe share of population of the middle income group in Indonesia has steadilygrown from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urbanmiddle income population in Indonesia totals approximately 66 million people (10) ,(10) (See “Appendix F - Independent Report on the Indonesia Retail Property Market”.) Retail Malls and Retail Spaces strategically located within well-establishedpopulation catchment areas.The Retail Malls are strategically located throughout Greater Jakarta with apopulation range of between approximately 0.4 million and 2.2 million withintheir respective primary catchment areas.The Retail Spaces are strategically located throughout Greater Jakarta andin the major cities of Semarang, Medan, Madiun and Malang. Quality Retail Malls which cater to the daily needs of shoppersThe Retail Malls are anchored by supermarkets, hypermarkets or departmentstores, which draw significant shopper traffic whilst the specialty, food &beverage and lifestyle and entertainment tenants provide shoppers with awide product offering and a complete shopping experience. Economies of scale through portfolio management of the Retail MallsThe Retail Malls will be able to leverage upon the Property Manager’s and theSponsor’s experience and will be managed by a specialised team of professionals. Quality tenant baseThe Retail Malls have a large combined tenant base of over 1,400 tenants (asat 30 June 2007) providing trade as well as product diversification.Top tenants include well-known international and domestic retailers and brandnames such as Giant Hypermarket, Gramedia bookstore, Starbucks, Giordano,Fitness First, Sports Station, Matahari Department Store, Hypermart andStudio 21 Cinema. Advance rental payment structure minimises cashflow volatilityRetail tenants in Indonesia typically pay an advance rental of approximately10% to 20% of the total rent payable for the duration of the lease upon signingthe lease agreement. This advance rental payment helps to minimise LMIRTrust’s cash flow volatility due to potential rental arrears.