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established with the foresight of strong growth in REITsaround the world, especially in Asia. This fund has sinceexceeded its targeted performance, achieving an annualisedreturn of more than 39% per annum since inception. Withsuch an excellent track record, Alpha will soon be openingthe fund to other investors.On track to becoming a multi-product platformAlpha has met its short-term goal of building a real estatefund management platform that delivers good investmentperformance to its investors and creates value for itsshareholders. The platform is scalable and Alpha is nowrepresented in two key Asian markets following theestablishment of local offices in Tokyo and Seoul.The company is on track to becoming a multi-productplatform catering to different investment preferences andrisk appetite of investors. When developing new products,Alpha will remain sensitive to investors’ needs and willensure that investors’ interests are not compromised.Alpha has identified Australia, China and India as potentialmarkets to establish local platforms for fund raising andinvesting. A platform in China is planned for 2007 to betterserve investment needs in this fast-growing Asian economy.In addition, Alpha is looking to launch two new funds in 2007.Asia will remain the centre of attraction for capital seekinginvestment in real estate products. This will invariablylead to competition for good assets and potentially drivingup property prices. Alpha is mindful of this risk and willcontinually develop new fund products with investmentstrategy that is founded on strong real estate economics andbacked by sound research and market intelligence.K-REIT AsiaAdditional platform to grow fee-based incomeKeppel Land achieved a new milestone when it sponsoredthe establishment and listing of K-REIT Asia on the SingaporeExchange by way of an introduction on 28 April 2006. K-REITAsia was established with the objective of generating stablereturns to unitholders by owning and investing in a portfolioof quality real estate and real estate-related assets whichare income producing and are predominantly used forcommercial purposes.With an initial portfolio of four prime office buildings –Prudential Tower (approximately 44% of the strata area of thebuilding), Keppel Towers and GE Tower, and Bugis JunctionTowers – K-REIT Asia has performed beyond expectations.Performance exceeds forecastsFor the period from 26 April to 31 December 2006,K-REIT Asia achieved a distributable income of $11.2 million,exceeding its forecast by 23.9%. Net property incomeoutperformed forecast by 11.3% to reach $16.8 million.Annualised distribution per unit was 6.76 cents, higher thanforecast by 24.5%.114Operations and market reviewSingaporeKeppel Land LimitedReport to Shareholders 2006