Good morning, everyone. It's great to see so many familiar faces on a Friday morning.

A very warm welcome to you all, and for those of you who are joining us online. I'm Michael Smith, the Group Chief Executive of Hongkong Land, and with me today is Craig Beattie, our Chief Financial Officer.

I recall this time last year when we were at our 2024 results presentation, our Strategic Vision 2035 was barely a few months old, and I recall being very, very thankful to the many of you who endorsed Hongkong Land's new direction and gave me and the management team the benefit of the doubt. That wore heavily on me and on the whole management team.

Over the past year, we've been relentless on our execution and delivering on the initiatives aligned with the core tenets of our new strategy, whether that be capital recycling events, new openings, and milestones at our ultra-premium integrated commercial property portfolio, or establishing our inaugural private real estate fund. Now let me talk you through some of the details of what I just outlined, as well as Craig and I going through our financial results for 2025.

We'll have plenty of time for questions. For those of you watching via the webcast, please send us your questions through the website, and we'll include them in the Q&A session.

Here's the structure for today's presentation, and unless otherwise stated, all numbers quoted in US dollar will be in dollars. Let's get started.

Turning first to key developments over the past 12 to 18 months, it's been a very, very active period for Hongkong Land. I don't think anybody can accuse us of being in a complacent management team.

If you look at the list of initiatives and achievements we've done this year, this last 12 months, it's been pretty formidable. Following the launch of our Strategic Vision 2035, we focused on our most pressing priority.

I recall one of these briefings somebody asked me, what is the most the three most important objectives? It was capital recycling, capital recycling, capital recycling.

We've done that both from our build-to-sell portfolios, we have where we have ceased incremental investment and selectively recycling from our prime investment properties book. In April, we announced the first major transaction with the sale of parts of One Exchange Square to the Hong Kong Stock Exchange for $810 million, validating the NAV of the Central portfolio.

In August, we completed a landmark leasing deal at West Bund Central, with Adidas committing to over 32,000 square meters in a whole building of 18 floors as their Greater China headquarters, one of the largest leasing deals in Shanghai for many years. As we exit from the build-to-sell segment, we also restructured our China operations to streamline governance and centralized decision-making.

We expect annual cost savings to reach around $50 million by 2028 with this initiative. In September, we achieved an orderly exit from our build-to-sell operations in Singapore and Malaysia through the disposal of MCL Land for over $650 million, again at NAV, at book value.

Also in September, we opened 50% our 50%-owned JLC Mall in the heart of the Nanjing CBD had its grand opening. In December, we announced the initial phase of the Tomorrow's CENTRAL transformation, including the opening of new flagship stores from leading global luxury brands.

Finally, in early '26, we completed the launch of our inaugural private real estate fund, SC PREF. This involved the disposal of our 1/3 stake in MBFC Tower 3 alongside seating our remaining Singapore portfolio and adding Asia Square Tower 1 to reach an initial AUM of $8.2 billion.

For a first fund, it's a it's quite an impressive achievement. All transactions highlighted on this slide were completed at or above NAV.

I'm going to repeat that a number of times, but all of these divestments were done at or above NAV, reflecting strong endorsement from buyers and global institutional capital. Turning next to an update on the group's strategic pivot.

On portfolio recycling, net proceeds reached $3.6 billion. This represents 90% of the $4 billion minimum target we set ourselves for 2027.

I think we surprised ourselves and the market in terms of the pace that we managed to achieve in our recycling efforts. These disposals crystallized independent valuations and validated the book values of our prime assets.

The seeding of our Singapore prime portfolio into SC PREF at NAV further illustrates the endorsement of prime property valuations by institutional third-party capital. These are incredibly credentialed investors, APG, QIA, endorsing the NAV of our assets.

On capital management, consolidated net debt declined by 30% to $3.6 billion. It's since reduced further to around 30 to around $3 billion following the formation of SC PREF, we're in single-digit gearing now.

We also increased full-year dividend by 9% to 25 cents per share, in line with our commitment to progressively increase dividend per share towards 44 cents by 2035. We a 2-cent increase in our dividend.

In parallel, we continue to allocate up to 20% of recycled capital to share buybacks, with over $340 million invested to date, reducing share capital by approximately 2.5%. On third-party capital, we successfully launched SC PREF, now the largest commercial real estate private fund in Singapore.

The fund establishes new recurring fee income streams and, again, represents strong validation of Hongkong Land's asset management capabilities by global institutional capital. Across our ultra-premium gateway assets, Hong Kong office committed vacancy tightened to 6%.

I recall when it was double-digit. With indicators pointing to recovery in the prime Central market, new flagship retail leases are progressively becoming effective, supporting rent and asset value growth, while West Bund Central continues to attract premium tenants as development progresses.

We also remain focused on assessing new UPICP opportunities across Asia's gateway cities. Finally, on operational excellence, following the restructuring of our China build-to-sell portfolio, we continue to enhance our operating model and cost discipline to support delivery of our Strategic Vision 2035.

On sustainability, we retained our global sector leader position and 5-star GRESB rating, and in line with our fund management ambitions, we have committed to the Principles for Responsible Investment. Briefly going through where we are in terms of our capital recycling efforts, which I'm very proud of.

The group is committed to recycling up to $10 billion in its 10-year strategy, but we front-loaded our efforts during the initial phase of execution, with an initial target of $4 to $6 billion by 2027, by the end of '27. Including capital recycled from the establishment of SC PREF last month, which was $1.3 billion, so that's $1.3 billion of capital was taken out of the formation of that fund, we've now reached 90% of our minimum 2027 target.

For reference, the aggregate capital recycled from our build-to-sell segment amounted to $1.4 billion, while net proceeds from prime properties book amounted to $2.2 billion. These are net proceeds, this is after any gearing attached to the assets.

In line with our previous guidance, at least 80% of capital recycled is allocated towards growth investments, growing our earnings, with up to 20% allocated to buybacks. Turning now to an introduction of SC PREF.

I think some of you were at the briefing last month, but just to reiterate, it's an initial AUM of 8.2 billion Singapore dollars, approximately 6.4 billion US dollars. Again, from the first inaugural maiden fund of a group, starting with a fund of that size is quite an achievement.

The fund has a committed equity of 4.1 billion Singapore dollars, or 3.2 billion US, with over 1.8 billion Singapore dollars of third-party capital. Again, in our first fund to start with $8.2 billion of assets and $1.8 billion of third-party capital is an achievement, and it endorses the value of the assets contributed to the fund.

The seed portfolio has an attributable net leasable area of 2.6 million square feet, or 4.6 million square feet on 100% basis, it's effectively bigger than our Hong Kong Central portfolio. Committed occupancy is 96% and has a healthy weighted average lease expiry of 3.2 years.

As you see on this slide, we have ambitions to grow the AUM of this fund to over $15 billion within 5 years. For those of you who know me, my ambition is to do that a lot quicker than that and beyond.

With a targeted IRR of about 8%, we have amongst the lowest cost of capital in the market to execute our growth plans, and we have some of the most credentialed real estate in the world supporting us. There's no redemption for the first 5 years.

We have their commitment to deploy more capital. We have a queue formed of new investors who would like to also join us.

We have a market where the supply-demand fundamentals for office in Singapore are very, very strong. We also have the fortuitousness of a number of assets coming to the market which haven't been marketed for many, many years.

The combination of all of that really provides a recipe for us to be able to grow this fund and grow the fund management fees, which are really, really important to us. Next, I wanted to show you briefly some highlights on work being done to enhance our Central portfolio.

All of you in the room would have seen all of the work that's been going on over the last couple of years since we announced, including some very early indications on returns on investment. Firstly, on Tomorrow's CENTRAL, during this period of partial closures, LANDMARK continues to be underpinned by our loyal Bespoke members, who increased their year-on-year spending by 8%.

We have had a number of very exciting openings, including Scarpadelli, which has opened its first store in Asia at the LANDMARK and is doing incredibly well. I'd like to take a minute to talk about the remaining four other new stores on this slide: Prada, Saint Laurent, Patek Philippe, and Miu Miu, all of which opened in December last year to catch the festive season.

The early returns on these four tenants alone have been very, very strong. Their new stores versus their last stores, they're up 70% since December 2024.

Again, despite over 30% of area remaining closed for renovations, LANDMARK had a spectacularly positive holiday season, with November and December absolute tenant sales up 13% year on year. In some respects, I think it's a trickle up.

People have made money through the stock market, the capital markets have been very strong, people now feel confident to go out and spend. November, December were amongst our strongest performance we've ever had in the LANDMARK.

These are early indications, but strong initial performance of these new stores validates LANDMARK's strategy of focusing on the ultra-high-net-worth segment, as well as working with brands to create large flagships, real experience where experience is Central. Turning to our placemaking efforts in Central, which forms part of Hongkong Land's strategy of living up to the ideal that Experience is Central, another one of the slogans besides UPICP, Strategic Vision 2035, Experience is Central.

Winter Wonderland in Central marked Hongkong Land's first flagship outdoor winter placemaking activation, delivered in partnership with the Hong Kong Tourism Board. The event was a step-up from the comparable 2024 events, attracting significantly more visits and social media mentions.

For those of you who attended, it was incredibly busy, and we plan to do it even bigger and better this year. Tenant feedback was highly positive, noting that the activation supported stronger retail momentum during the festive period.

Moving on to an update on West Bund Central, where the team is hard at work delivering on phase two of this project. West Bund Central Residences, this is a serviced apartment brand that Hongkong Land manages, again another fee revenue for us, continues to be well-received, with phase one being 96% occupied and phase two, which only opened in the fourth quarter of last year, is now 55% occupied.

The office component marked a number of milestones, with both Lululemon and Sinopharm having moved in. Adidas's new Greater China headquarters is currently being fitted out, with completion expected by mid-'26.

Post completion of this group of offices, we expect the number of office workers commuting to the development to exceed 2,000, just from this group. Finally, the 27,000-square-meter retail component with a contemporary fashion and lifestyle positioning is well on track, with pre-leasing commitments of over 75%.

The offering will have about 70 designer and lifestyle brands. Adidas and Lululemon, who are office tenants, will also have flagship stores.

Tenant fit-outs are in progress, with initial openings in May of this year and full opening by the third quarter. We're not stopping there.

The group continues to make progress in executing on its pipeline of projects in the Chinese mainland. We don't want to be in every city.

We want to be in the best cities where we think we have the most impact, one of those being Suzhou. Suzhou Central will have around 67,000 square meters of retail space overlooking Jinji Lake.

The retail component will be anchored by the largest global luxury brands, many of those that you see in our Central portfolio, a vast majority of whom have already committed to the project. Pre-leasing now exceeds 50%, even though we're more than 12 months away from opening.

The project will also feature a very, very lovely 140-key Mandarin Oriental hotel that will also open in April '27 and sits right on the lake where the sunset's over. It's going to be brilliant and highly recommend you visiting when we open.

In line with the group Strategic Vision 2035, we continue to refine our approach to enhance operating models and to manage costs. Obviously as we are divesting assets and recycling capital, earnings will suffer.

We're trying to ensure that we have an operating model that gives us an opportunity to manage our cost base is very important. The group has initiated a streamlining of its operations by implementing a portfolio-led operating model, with an aim of delivering platform-ready operating and financial performance.

This includes three key organizational changes: firstly, instituting a portfolio-based leadership to enhance accountability, people who are basically own and are accountable for a cluster of assets; secondly, refining corporate functions and operational centers of excellence to drive standards, consistency, and discipline growth; and thirdly, ensuring a refreshed Management Committee, which provides the appropriate centralized oversight. This sort of organizational enhancement really is an outcome of what we announced back in October.

It's a steady progression when we've seen what Stuart Grant has done in West Bund, what Pei Ting has done with our fund. It just became obvious that we need to have sort of centralized, focused attention on clusters of assets.

The objective for this change is to ensure end-to-end accountability for returns, improve capital allocation and risk discipline, enable faster and more consistent execution at scale, and deliver platform-ready asset performance. Turning over to a brief introduction of the refreshed leadership team.

The Management Committee will be chaired by myself, with the portfolio leaders reporting directly to me. These portfolio leaders include Alvin Kong, who is already part of our management team.

He had a long career at Swire Properties before joining us. He will now take on the responsibility for leading our China integrated properties portfolio, our Ring series, our properties in Suzhou, Chongqing, Beijing in the Central series, but also he will be in charge of recycling capital from our build-to-sell assets.

Next is Graham Tory, who some of you may know. He has rejoined Hongkong Land.

When I first met him back in the '90s, he was at Hongkong Land. He now brings with him three decades of leadership experience in real estate and investment management across Asia Pacific, including most recently leading APG Asset Management's Asia Pacific business.

He will be accountable and responsible for the whole Hong Kong Central portfolio. Next up is Pei Ting, who had joined us prior to the formation of SC PREF.

She is the Chief Executive of that fund and will continue to manage and grow the AUM of what is already the largest commercial private real estate fund in Singapore. Finally, as I mentioned Stuart Grant, who stepped down from our board, relocated his family from the UK to Shanghai, and he will continue to lead the execution of West Bund Central.

He's really galvanized that team and our relationships with our partners, as it's one of the largest mixed-use commercial projects under development in the region, therefore requires somebody of his stature and experience to have direct accountability and oversight of that project. I'll now pass over to Craig to walk through our 2025 results.

Thanks, Michael. Good morning, everyone.

Before we dive into numbers, I want to spend a little bit of time to set the scene by highlighting some changes that we've made in the way that we report, which we believe better aligns with the priorities we've outlined in our Strategic Vision 2035, specifically the decision to wind down the build-to-sell segment. By making these changes, our aim is to provide a clearer understanding of the group's underlying performance related to its principal operations.

There are two changes that we've made. First, assets immediately available for sale, for example, residential inventory within the build-to-sell portfolio, have been reclassified into non-trading items.

Secondly, recurring income-generating assets that were previously held within the build-to-sell portfolio, which historically we had referred to as medium-term lease assets, and these are primarily retail malls in China under the Ring brand name, we've reallocated those assets into our prime properties investment segment. These assets were historically carried at their development capitalized cost, and they were fair valued by independent valuers at the end of the year.

Similar to our prime properties investment portfolio going forward, they will be marked to market every 6 months. Basically by making this change, the group's underlying earnings now solely focus on prime property commercial income and fund management fees as we build that stream in the coming years.

As I said, the reason we've made this change is to provide all of you with a clearer understanding of our underlying performance, and we've also restated the 2024 numbers to give you a clearer ability to compare year-on-year performance. If you want any more detail on this change, I refer you to note one of the financial statements that was released last night.

Let's get into the results for the year overall. All monetary amounts are in US dollars unless otherwise stated.

Profit to shareholders was $1.2 billion, a significant turnaround compared to a loss of $1.4 billion in the prior year. This movement was primarily driven by an increase in the independent valuations of our portfolio, including an increase in the valuation of the Hong Kong Central portfolio, which is actually the first time we've had an increase in the value of the portfolio since 2019, when rents began to fall in Hong Kong.

The group's underlying profit on the new basis was $458 million, down 8% from the prior year, primarily due to lower rental contributions in Hong Kong. Adjusted free cash flow amounted to $810 million in the year, or just over 37 cents per share.

I will elaborate further on this metric in a subsequent slide, but what this tells us is, despite lower profits from the build-to-sell segment as we wind it down over time, the cash contributions that we are benefiting from as we recycle capital continues to be quite significant. Assets under management post formation of the Singapore fund, SC PREF, reached $50 billion, and the net asset value per share stood at $14.30 at the end of 2025, up 5% compared to the end of 2024.

Net debt declined significantly by $1.5 billion to $3.6 billion, and in fact, as Michael mentioned, has fallen further in the early part of this year down to $3 billion, as we had significant cash inflows from capital recycling initiatives throughout last year. In recognition of the strong cash generation, the board has declared a final dividend of 19 cents per share, bringing the full-year dividend per share to 25 cents, a 2-cent increase compared to 2024.

Operating profits from prime properties investments decreased by $81 million year on year, primarily due to negative rent reversions for Hong Kong office, as well as temporary impacts from the retail renovations at LANDMARK. Contributions from Singapore were higher due to positive rent reversions, and there were lower contributions from other regions, primarily due to ongoing renovations at our mall in Macau, as well as temporary pre-opening costs in China as we start to open a number of new projects there in the coming years.

Net financing charges were lower by $33 million year on year, primarily due to lower average borrowing rates, and taxes were lower due to lower profits. In line with the group Strategic Vision 2035, the return of capital from the build-to-sell segment continues to be a big priority for us.

Whilst, as I said, profit contributions from this segment will naturally reduce as we're no longer investing in the segment, there's cash that we are taking back as we sell inventory, and of course, the benefit of that you will see through the reduction in our net debt line. As a result, we're very focused on the adjusted free cash flow metric, which does include maintenance capex on our prime properties portfolio, primarily in Hong Kong, as well as the cash we get back from the build-to-sell segment winding down.

In total, that was $810 million in 2025. This metric does not include major capital recycling initiatives.

The things that we did last year, the sale of some floors in One Exchange Square to the Stock Exchange, the sale of MCL Land, and the sale of MBFC Tower 3, the cash proceeds from that are not in this metric. The purpose of this metric is to give you a clearer understanding of our operating flows.

In 2025, the net revaluation gain was $890 million, primarily driven by an increase in market rents for the LANDMARK retail, so as Tomorrow's CENTRAL continues on its renovation and the positive reversions that we're seeing from the portfolio, there was a good uplift in the independent valuation of that particular asset, plus there was benefits in both Singapore and West Bund where the rental outlook in both markets improved compared to the prior year. Other non-trading items in the year included $247 million of revaluation gain from the reclassification of our medium-term lease assets, the Ring assets I mentioned, from build-to-sell to prime properties.

As I said, these assets have previously been held at their capitalized cost in the past. Losses from the build-to-sell business were a net $245 million, which included a non-cash provision of $371 million on Chinese mainland assets.

As we continue to prioritize recycling of capital and the wind-down of inventory, we are looking at the sales price of our assets in a very difficult market, and we took the decision to mark down on a selective basis some of the sales prices on our assets to really benefit sales. Net asset value per share at 31st December was $14.30, up 73 cents or 5% compared to the end of 2024, driven by the valuation gains in our portfolio, as I mentioned, and there was also positive contributions from the business, which was partially offset by the non-cash provisions in China, as I mentioned.

The group invested just under $280 million US dollars in share buybacks during the year, resulting in an accretive impact to NAV. Net exchange translation differences mainly relate to assets on the Chinese mainland and Singapore, which had a higher value due to strengthening of the RMB and Singapore dollar.

As our reporting currency is US dollars, obviously we translate foreign assets into US dollars, and these currencies have strengthened throughout the year. Let's turn to an update on dividends and share buyback.

As I mentioned, we've declared a higher dividend, up 12% from the prior year, full-year dividend now 25 cents. The growth in dividends is in line with our long-term target to double dividends per share by 2035.

Our objective is to go from 22 cents to 44. Obviously at 25, we've still got ambition to grow that a lot further.

As I mentioned, strong cash flows from both prime properties investment and the unwinding of the build-to-sell segment provides support for the dividend through our strategic transformation. Over the longer term, we remain committed to paying a dividend payout ratio in the region of 80% of underlying earnings per share.

In the next few years, as we wind down the build-to-sell segment and ramp up our business, particularly in China as new projects complete and Hong Kong starts to come back, we're anticipating some good growth in earnings looking forward. On the buyback, as you're aware, we announced three separate tranches to the buyback program as we recycled capital, and as Michael mentioned, up to 20% of recycled capital is being allocated to buyback.

A total of $650 million has been announced, of which $340 million has been invested as we sit here today. Total capital returned to shareholders, which includes the buyback plus the dividend paid, amounted to over $780 million in 2025.

The buyback, as we've previously guided, of course, remains in place, and the pace of that is driven by market conditions, as well as new investment opportunities that we see on the horizon. Touching now a little bit on treasury, the maturity profile of the group's debt is shown on the left-hand side of this slide.

The debt maturities are staggered over a number of years and are well-diversified between both banks and debt capital markets. The group remains well-financed with strong liquidity and no significant financing needs in 2026.

The average tenor of our drawn debt at the end of December was healthy at 5.8 years, and the average interest cost further decreased to 3.3%, down from 3.6% at the end of 2024, driven by lower average interest costs, primarily in RMB, and 59% of the group's average gross debt was at fixed rates. At the end of December, the group had available liquidity of $3.5 billion compared to $3 billion at the end of 2024, reflecting quite significant additional investment capacity.

As we've guided previously, we've been very focused on recycling capital, and now we feel we have a strong balance sheet with capacity to seek new growth opportunities. Our credit ratings by both S&P and Moody's were unchanged at A and A3, respectively.

Let me turn now to an overview of the group's rental income and operational updates on our key segments. Overall, rental income was solid.

It was down by only 2%, mainly due to a 7% decline in contributions from Hong Kong office due to negative rent reversions. However, leasing momentum for the portfolio improved in the second half of the year.

Income from Hong Kong retail was temporarily impacted by the ongoing renovation works in LANDMARK, and this was partially offset by positive rent reversions in retail from a number of the new maison stores that have opened. These rental declines were partially offset by higher rental income from Singapore and the Chinese mainland.

Turning to a leasing and operational update on our key portfolios, average net rents were 94 Hong Kong dollars per square foot per month. Vacancy on a committed basis declined to 6% compared to 7.1% at the end of the year, I think a very solid performance.

For reference, compared to the market overall, Hong Kong Central Grade A office vacancy at the end of last year was 11%. Our overall WALE, weighted average lease expiry, stood at 3.6 years for the portfolio, whilst the WALE for our top 30 tenants, who occupy close to half of our space in Central, was 4.7 years.

At the end of December, 13% of the portfolio is subject to expiration in 2026. In retail, as we said, a positive performance.

Average retail rents increased by 12% to 236 Hong Kong dollars per square foot due to positive rental reversions. Our rental income on a per-square-foot basis has really recovered from the immediate impacts post-COVID.

I think this is a particular bright spot for Hongkong Land. When you think that over 30% of the lettable area was temporarily out of action for renovation, I think that shows really how strong the mall performance was, and the remaining 70% in action was fully let in the period.

The WALE at the end of December was 5.4 years, up significantly from 1.8 years. As we were positioning for Tomorrow's CENTRAL renovation, we were letting existing leases wind down, but, of course, we've now entered into some very long-term leases with key anchor tenants, which is reflective of their long-term commitment to LANDMARK, to Hongkong Land, and, of course, to Hong Kong overall.

What they are creating here is some of the world's biggest and best stores. I think you should expect to see the WALE continue to move up in the next couple of years as we continue to enter into other long-term leases with other brands.

I think as Michael mentioned on the tenant sales performance, there were a couple of key points to note. The whole ultra-high-net-worth segment, which is a core part of the customer base of LANDMARK, was incredibly strong last year, with our top-tier customer spend increasing 8% compared to 2024, demonstrating the resilience of this customer group.

Overall tenant sales of LANDMARK, despite the renovation impacts, was only down by 5%, which is a phenomenal impact considering the sort of temporary impact of the renovation overall. Singapore was also a very bright spot, and please note the performances on the slide here were prior to the formation of SC PREF, the fund which was formally created in February of this year.

The office portfolio continued to perform very well, driven by a flight-to-quality demand and no new Grade A office supply in the Marina Bay CBD. Rents continued to show steady growth.

Average gross rent across the portfolio last year was 11.5 Singapore dollars per square foot, an increase of 4% year on year. Positive rental reversions were achieved, and committed occupancy was at 97% overall.

Positive reversions were actually up 12%, which is quite significant. I hand over to Michael for a market update.

Thanks, Craig. Let's look first at the Hong Kong office market.

There was strong net positive absorption in 2025, with spot rent seeing mild growth, which has been well-articulated by the brokers. Flight to quality has resulted in a divergent market, even amongst different segments of Grade A stock in Central, with trophy or ultra-premium assets continuing to be net beneficiaries.

The well-publicized recovery of IPO activity in Hong Kong is not showing any signs of slowing down, with net proceeds raised in January this year alone reaching $3.7 billion. Finally, new supply of office space in Central only makes up 7% of total office space is largely accounted for.

Beyond these, there is no new office supply in Central until the launch of Central Yards Phase 2 in 2032. The supply-demand dynamics, particularly of the ultra-premium, very high quality office which our portfolio is part of, is very, very, very good.

Moving on to luxury retail, where we continue to see strength at the LANDMARK due to steady growth of ultra-high-net-worth luxury spend in Hong Kong. According to the latest World Ultra Wealth Report, Hong Kong ranks second globally in terms of the number of ultra-high-net-worth individuals, people who have more than $30 million of net assets, behind only New York City.

Going forward, we expect to continue seeing steady growth in the spend from this segment. You'll see on this slide some key statistics from our bespoke VIC shoppers program, this is our loyalty program that we've been creating since 2018, comparing year-on-year spend by our top-tier customers.

Some of these statistics are just incredible. The top 100 local spenders at LANDMARK in aggregate spent 1.2 billion Hong Kong dollars, a 16% growth compared to 2024.

That's more than $1.5 million spent on average for each of these VICs at the LANDMARK mall. VIC sales accounted for almost 85% of total sales of the Bespoke program and continues to grow.

Digging a bit deeper, you'll see how important VICs are to our strong performance. The average ticket size, the tenor, and the lifetime spend of the VICs are all significantly higher than the rest of the luxury market.

A final number I'd like to leave you with, just to get a sense of our VIC spending power: the top 10 lifetime customers since the launch of our Bespoke program in 2018 have had a cumulative spend of 1.3 billion Hong Kong dollars, the top 10. In terms of consumption trends, the majority of their spend continues to be on watches, high-end jewelry, ready-to-wear fashion, and premium leather goods.

Moving on to Singapore office, where we see favorable demand-supply dynamics in the Marina Bay CBD over the next several years, which is likely to result in steady growth of gross rents. According to the Urban Renewal Authority's latest draft master plan, there will be very, very limited new office supply in core CBD over the next few years, with only around 110,000 square foot of net new supply per year from 2025 to 2029.

This augurs very, very well for our SC PREF fund. On to retail in the Chinese mainland.

The difficult market conditions over the past couple of years have been very well-documented, and despite improvements in certain market segments, such as the luxury market versus a low base in '24, we expect the market to remain highly competitive in 2026. Having said this, consumers and, by extension, our tenants are rewarding well-located and well-managed assets which are able to deliver innovative and experience-led concepts.

For the year ahead, active asset management involving constant tenant mix optimization and the ability to continue delivering on creative and engaging experiences remains critical to driving performance improvements. There's a handful of us who are still strong believers in the luxury and the retail market in China and deploying capital.

Many of our peers are not. Many of the private companies in China who previously were opening malls in China are no longer opening those malls, it really is an opportunity for us and others to take advantage of that.

Looking at outlook for 2026, take a moment to go through our thoughts across the key markets. For Hong Kong office, positive net absorption for the prime Central segment is expected to drive return to growth for market rents.

For those of you in the room who know, from the trough of the office market cycle to the peak, rents can move significantly, and particularly in the Central district, the very core. If a tenant comes to the Hong Kong Central portfolio, it may go to IFC 1 and 2, it may go to Henderson, it may go to AIA, but it's only a very small group of assets.

That group of assets, the vacancies is about 3.5% right now, with I think IFC, we understand is 99%, 100% occupied. That small group, that small cluster of assets where there's a disproportionate amount of demand from financial institutions, from private equity, from hedge funds, from family offices, is really going to enjoy the full benefit of that rental uptick.

We've seen the positive momentum from the second half of last year continuing into this year. Reversions may remain negative, but we think the magnitude is expected to reduce significantly this year as market rents really come into an upside trend.

For the LANDMARK, the initial phase of Tomorrow's CENTRAL has begun bearing fruit. As new openings for phase two are progressively launched, further positive rental reversions are expected.

As you saw on previous slides, ultra-high-net-worth consumption, which is our focus, has seen solid, solid growth, and we expect this to continue into 2026 and beyond. In Singapore, we expect positive reversions to continue on the back of limited supply in the CBD and a largely stable economic outlook.

For China, we remain cautiously optimistic on the short-term trading outlook. Our focus on active monetization of our build-to-sell assets, execution of phase two of West Bund Central, and driving performance of our lifestyle retail pipeline remains unchanged.

In terms of our strategic priorities and focus areas for 2026, on portfolio recycling, our ambition remains unchanged. We continue to work on opportunities to monetize build-to-sell assets, as Craig said, bringing that cash back into the non-core assets the upper end of our ambition of $6 billion by 2027.

On capital management, our approach remains consistent. 80% of recycled net proceeds will be earmarked for earnings growth investments.

We know we need to grow our earnings, and that's a very, very strong focus of Michelle, myself, and Craig, and the management team, and up to 20% allocated to share buybacks. In line with previous announcements, future buybacks will continue to be funded by capital recycling.

As we sell something, we will continue to use that 20% of that on our buyback program. For dividends, I think this is a really important point.

We say what we do, and we do what we say. We told the world that we were going to double our dividends by 2035, and this really proves that point.

Our intention is to continue to do that, and our absolute intention is to have a dividend of 44 cents by 2035. On third-party capital, there is plenty of work ahead to secure new potential capital partners for SC PREF.

Michelle is working incredibly hard at making sure that the queue of new investors who want to join us is as long as it possibly can be. We also continue to engage with these capital partners not just in Singapore, but given the strength of our relationships, there may be other opportunities in other gateway cities that we can work with them on.

On ultra-premium gateway assets, the focus on existing portfolio anchors is to continue delivering for our tenants and our customers across both Tomorrow's CENTRAL and West Bund Central, absolutely critical that we make sure that the operating performance of those assets is world-class. In terms of growth opportunities, the team is firmly focused on executing our growth ambitions in SC PREF.

It's an incredible opportunity for us to grow that vehicle, as well as active assessment of new gateway city opportunities. Before we conclude for today, I'd like to spend a few minutes on enhancing shareholder value.

When I joined, our focal point on October '24 was TSR, was total shareholder return. I think over that period, I think we've had the strongest total shareholder return of any real estate company in Asia Pacific and one of the strongest in the world.

That really, looking at this chart, when I joined, the discount to NAV was 80%. We were trading at about a $6 billion market cap on $32 billion of net asset value, 0.2 times book.

By saying what we do and doing what we say and all of the events that have transpired since then, that gap has closed. That's really our focus.

By selling assets at NAV to demonstrate that our assets are truly worth what we say they are, by doing the recycling, the buyback, the dividend growth, doing everything we can to ensure creating new fee income streams through fund management, that we continue to close that gap. We've still got a long way to go, we're 40-odd percent discount to NAV, our NAV is just ticked up, as Craig said, even harder work for us, but we will continue to focus on closing that NAV gap, fully cognizant that one of the key reasons this has come to fruition is that we have followed through on the commitments that we made to you.

Despite the strong start we've had, we intend to continue doing what we have said, and we will absolutely do it. The whole management team, the reorganized restructure that we've gone through, all focused on closing that gap.

Our work is far from complete as we remain firmly focused on narrowing this discount. If there's one thing you remember when you leave, it's narrowing the discount, it's absolute focus.

As we continue to reposition the business, our aim is to facilitate investors valuing the group on the sum-of-the-parts basis. I was an investment banker, I wasn't allowed to speak to research analysts, but not trying to tell you how to do your job, but over time, this would be a great way, I think, as to how potentially the investing community could value Hongkong Land.

Firstly, the prime property assets, the aspiration is that they're valued at NAV, and I think we've demonstrated that in Hong Kong. Our NAV has been supported by both the One Exchange Square transaction with the Hong Kong Stock Exchange, as well as there's been a number of high-profile transactions, our sister company Mandarin selling half of One Causeway Bay, etc., all in around that NAV over the past 12 months.

For Singapore Central, the establishment of SC PREF with Hongkong Land portfolio valuations endorsed by some of the most credentialed real estate company investors in the world. APG did a huge amount of work before they invested a significant amount of money in that fund at NAV.

That whole fund should not be valued at any discount. In all of your models in my mind, whatever discounts you want to apply, shouldn't be on the Singapore pool, that should be at NAV.

For West Bund Central and other assets on the Chinese mainland and across the region, the current share price indicates that there's next to no value ascribed to them. If you fully value Singapore, you look at what we've done in Hong Kong, there's no value at all subscribed to our China business.

As these assets stabilize and potentially recycle into platforms, we feel that there is significant upside from there. For the build-to-sell book, we continue to execute on a robust recycling plan, absolute focus of attention.

We've taken the provisions, we are pricing these assets for sale, we've already demonstrated the ability to generate net proceeds in an efficient and consistent manner. This part of the book should be valued on a DCF basis.

You should take a view. We believe that by 2028, the majority of this inventory will be sold, some type of DCF to bring that back.

The final component is recurring fee income earnings. We announced our intention to create a fund management business, and we have created a very big one, and we intend to grow that as quickly as we can and generating a new stream of fund management fees, which is not embedded in our NAV.

This is a separate business, right? It's very high quality, predictable income streams.

In the case of SC PREF, it's perpetual, and it's growing. There's acquisition fees, there's asset management fees, there's leasing fees, there's performance fees.

It's an incredible array of fees that we're going to generate from that fund. Those earnings should, I think, qualify for a much higher multiple than maybe other earnings given the quality of that income stream.

We expect that we will scale SC PREF, as I've said, and establish other fee-related income streams in other cities will in time grow this business to be a material component of the group's earnings. Overall, we've built very, very solid momentum, and I think everyone thinks what's next for Hongkong Land.

There's a lot more for Hongkong Land. Please, we're not going to sit by complacently and do nothing.

We're all going to be working as hard as we ever have to close that NAV gap, to deliver on our promises, but still, because there is a lot more work ahead, but we're going to do it. I want to thank you for your support and happy to take any questions from the floor.

Thank you. Shoot.

Please.

Thank you. I'm Karl Chan from JPMorgan.

I have two questions. The first question is on dividend because our understanding is that the guidance on DPS growth will be at roughly around mid-single-digit percentage, right?

For this result, you guys surprised us once again with a 9% hike in the DPS. Then if we look at the payout ratio, right, in terms of adjusted free cash flow, it's like 60-ish percent, it's okay, but then if it's based on underlying earnings, it's actually more than 100%.

How do you arrive at this 9% growth in dividend? Most importantly, going forward for next year, how should we think about the DPS?

Should we also expect a mid-single-digit growth, or actually we might be able to also look for a high-single-digit growth in dividend? For the next financial result, should we look at dividend more based on earnings or based on FCF?

That would be my first question on dividend. For my second question, it's very simple.

Just now, Michael, you mentioned that the goal is to narrow the NAV discount, right? What's your goal?

Do you think that we should actually target a 0% discount in NAV? That's my second question.

Thank you.

Okay. Thank you.

Do you want to answer the first one?

Yeah. I think on the dividend, Karl, the raising it 9% may seem a bit counterintuitive when our underlying profit has gone down by 8%, but it's really a reflection of a few things.

The strong capital recycling that we have achieved last year, which is quite impressive. Secondly, the strong operating cash inflows, which includes the benefit of the prime properties investment portfolio, but also as we unwind the build-to-sell segment, there's a lot of cash to come back from that too.

From the board's point of view, we feel that we have done a lot and therefore rewarding shareholders with a little bit of that, noting that for every 1 extra cent on our dividend has a cash cost of about $21 million. The extra cash cost is $42 [million?]

by raising it by 2 cents per share. A $42 million cash cost against the many billions of US dollars that we recycled is very manageable overall.

I think as we look forward, as I said in my sort of overlay, the intention is to continue to look at our underlying earnings ultimately and for payout ratios, that's the right thing to do. It's a general guide in the medium to long term, about 80% of our underlying earnings will be paid out as a dividend.

That's our general philosophy. Obviously we find ourselves in a bit of an interesting phase because we've invested a lot of capital in commercial assets in China, which are under development.

They will complete in the next few years. The rental income will grow, plus we've got Tomorrow's CENTRAL in Hong Kong, a big investment that's starting to complete and bear fruit, and hopefully the Hong Kong office market is troughed and will start to rise.

In increasing the dividend, the board is also signaling that we have confidence in our earnings growing over time. I think in the short term, I would look at our free cash flow, adjusted free cash flow per share as a guide, but over the medium to long term, it will revert back to underlying earnings.

The intention is, again as I said, to ultimately double dividends per share, you should expect us, absent any unforeseen events, to continue to grow the dividend. May not be 9% every year, but there's an ambition to grow.

I'm not going to give any price targets, but I'm a hard person to satisfy. There are some of our peers in Australia, Goodman and others, who trade at premiums to NAV because their fund management business is reflected in their share price.

Theoretically what we've just done with SC PREF, $6.3 billion of AUM US, a 5% sort of value of that business is a $300 million value creation there. It's perpetually open-ended, we are going to grow it, that value should also grow.

That should help either bridge the gap or maybe if we do hit NAV, then it goes beyond that. Not a price target, but I think as we try to describe how assets could value that NAV, we're going to redeploy a lot of the balance sheet that we've been recycling, we're going to redeploy that in earnings, that'll be incremental earnings growth that will come through.

We're going to grow our fund management business, which is an income stream which is not factored in. I think all of these elements, in my mind, NAV is probably not enough, but I'm biased.

Please.

Thank you. This is Raymond Liu from HSBC.

I got two questions. The first question will come to Michael.

In early this morning, there was a press interview. Michael mentioned that Hongkong Land might potentially create a fund for Hong Kong properties.

Can Michael further elaborate and provide us more color on this one? The second question is about the fund management business.

If you look at the capital recycling, which is the phase one of the strategy, amazing, which you provide a lot of guidance in return target, long-term target, how you're going to execute, and so far we see actually very good progress. Can management also provide some of guidance and how we can visualize in terms of your fund management business, in terms of AUM, fund growth, how you're going to build it outside, say for example Korea, Australia, and Japan, and other places as well?

Thank you.

Sorry, I was listening to the second. What was the first one?

Hong Kong.

Hong Kong. Sorry.

In terms of our intentions, we made it very clear in October '24 that we want to be a real estate fund manager. We say what we do, and we do what we say, and we've created our first fund.

We've got very, very good institutional LP relationships. APG is one of the world's most credentialed real estate investors.

They don't invest in everything. They invested a lot of capital alongside us.

Qatar Investment Authority, there's a very large sovereign wealth fund from Southeast Asia has come along. Performing well on that fund, exceeding expectations, exceeding the underwrite will help us work with them further in other jurisdictions.

In terms of Hong Kong, when we say we want to be platform-ready, and with Graham's role, it's not to create a fund, but it's to make sure that it's managed like a fund and that it's platform-ready and that there's a spotlight on it. Nobody can sort of hide when there's light on them.

It's going to perform like it was in a fund. Whether we do a fund or not, it's going to be platform-ready.

I'm not going to say yes or no as to whether that's the intention, but we will be ready if an opportunity arose. We wouldn't be constrained by the operational structure that was managing it.

Maybe if I help out a little bit on the second question. I think we were very clear when we announced the strategy that the goal is to grow our AUM to $100 billion.

At the end of the year, we're at 50, or currently we're at $50 billion US, effectively we still got a doubling to go, which is quite significant growth. Some of that increase will come from natural valuation increases in our existing portfolio as we anticipate rental growth, but the vast majority of that extra 50 that we need to find is basically new investment opportunities supported by third-party capital.

Given our focus on sort of prime office and retail primarily, we're generally a core, core-plus type investor. In terms of guidance for how you see the sort of fund management business building, I think you're familiar with the sort of fees that core, core-plus type strategies generally attract.

You can apply a sort of a percentage to that sort of AUM growth to give you a guide. I think there could be further upside because, as Michael said, in the existing $50 billion AUM, actually the majority of that is not currently in any fund structure.

There are opportunities potentially over time as we evolve the portfolio and some of the portfolio matures, particularly in China, you may find that actually we start to earn a fee on the existing AUM as well. Ultimately, in terms of potential, you can take $100 billion and apply some assumption around the fee income, and that's kind of what we're trying to ultimately get to.

Thank you. This is Cindy from Citi.

I have three questions. The first question is on your strategic priorities.

You mentioned last year it's all about capital recycling. This year, what has been added to your new priority list?

Is it capital deployment, fund management, and what else? Second question is regarding the target return of your new investment.

Presumably, as you grow your AUM, what kind of a return profile are you looking at? Is it, say, the 8% for the SC PREF as a reference, or what would we be looking at?

The third question is actually back to your Central retail, which we think is quite remarkable in terms of your rent growth and the VIC retail sales. Anything else you can do in, say, the coming years to further elevate the project?

What kind of the renovation progress and opening schedule for the new flagships this year? Thank you.

Why don't I answer the first one? In terms of recycle capital, recycle capital, recycle capital, deploy capital.

I think that really is quite a focal point. The fact that we managed to create SC PREF by merging with one of the best assets in Singapore that was been owned since 2016 by the Qatar Investment Authority, we didn't deploy any capital to buy that, but that building is now under our control.

We now manage it, we lease it, we get fund management fees from it. The opportunity to scale that vehicle and deploy our own capital alongside our partners is a big priority, as well as other gateway cities that we're looking at.

There's been a lot of work in exploring and thinking through Sydney and thinking through Seoul and thinking through Tokyo. The core business is also really important, ensuring that Tomorrow's CENTRAL is a success that it's rolling out to be, and to ensure that West Bund phase two and phase three and phase four are opened successfully and well-let up, incredibly important.

Core business plus growth are probably the two new priorities for me. Craig?

The second question is about returns generally, and I think we've said publicly that SC PREF sort of target return for investors is about 8%, what you quoted, which is correct. Obviously for us, as both an investor, but a fund manager, the return is higher.

If you look in terms of the fees that we will earn over time from that vehicle, then our returns are more in the 9% to 10% range, we project. Of course, SC PREF has growth ambitions, part of our AUM growth will come from expansion of that fund overall.

I think in terms of opportunities for us to invest, but also to improve our return on capital, SC PREF is actually well-placed to help with that overall.

I think your last question was on Tomorrow's CENTRAL and how Hong Kong retail? Craig and I were at the top of Prince's Building last night for Jardine Matheson function, which is Terrace Bleu.

It's incredible. It's really, really amazing, and I really would like you all to attend on the 12th, but all the seats are booked, please.

Opens next week.

Opens next week on the 12th. I think our timing has been really, really good.

In terms of opening up the first phase of our flagships, the experiential openings that we're doing now, Robuchon opening, now Terrace Bleu opening, things seem to be working on a good trajectory in terms of the underlying demand, as we've said with what our Bespoke clients are doing, but just the general activity in Hong Kong. We can all feel it.

You get stuck in traffic jams, and it's hard to walk around the corridors. It feels as though Hong Kong is really, really back on its feet and really running now, and we're benefiting from that.

I think as we continue to open and deploy the capital and work with our partners as they open up their flagship stores, and as Craig said, some of these stores are the biggest in the world. They're going to be incredible, like nothing anyone has ever seen.

I think that will then add to the attraction of Central, and more and more people will come in. We're not just focused on our inside of our building, we're really also looking at the public realm and what things we can do to ensure, like Winter Wonderland and the festive season, how can we absolutely ensure that Central is the heartbeat of Hong Kong.

Maybe just to supplement the sort of positive statements that we've made about retail last year is only the beginning because, of course, Tomorrow's CENTRAL's not yet complete, and so it's actually been quite nicely timed. We're generally opening two maisons a year.

Last year we had two open, we've got another two opening this year, two the year after, and two the year after that. The whole investment case for that overall project ultimately will see Hongkong Land's rental income we predict to grow by 20% to 25% off its prior renovation levels.

It's quite significant, actually. The value that creates both in earnings, but also the valuation of the portfolio, and you saw the valuation go up at the end of last year, that's really reflecting part of the rental income.

Actually, I anticipate the valuation going up more in the years ahead as that rental income comes through. I think on Michael's point around the renovation, what we're doing in the public realm, there's a couple of exciting things hopefully happening later this year which we can't talk about, but we will tell you when they happen.

There's a lot to come.

Hi. Karl Choi from Bank of America.

Three quick questions. First one, further on the retail side, any color you can give on the Hong Kong retail tenant sales, how the sales have performed year-to-date?

This year? for this year, yes.

Second is for Central office. Just curious, it might be still early days, but any signs that you've seen some slowdown in decision-making on the part of corporates when it comes to office leasing?

Any concerns that if the Middle East conflicts drag on, that can be a little bit of an issue? Third is for China retail, any update on the initial yield on cost for the Nanjing mall that you opened last year or the Suzhou one that you are planning to open?

What was the cap rate in general or the range of cap rates used by the valuers for the assets that have been reclassified from assets for sale to IP? Thanks.

Maybe the second question, it's way too early for us. We're a fixed asset business, our real estate can't be moved, we're not in trading.

All our tenants have long-dated leases, half of our office portfolio is from very large companies that have long-term leases with us. It's really too early to tell, but our business is quite, I think, immune to any of these political shocks, and it's built for resilience anyway.

The third one was about China retail and some of our yield on cost?

Maybe if I pick that up overall. I think you've two parts to your question.

The first was about some of the new malls that were opening. Obviously, we opened a mall in Nanjing partway through last year.

When we open malls, clearly we give lease incentives to tenants to basically come into the mall. The whole objective of us is to open the mall with high occupancy and then build the rental income over time.

The current yield on cost is sort of low single digits, but that will grow as the mall expands. Suzhou is opening next year.

Obviously, that's positioned at the luxury segment. We've got very strong leasing progress on that mall.

We will be the market leader in that city when we open. I think Michael showed a slide about the project, and it's quite an impressive project overall.

I think there we should have quite strong confidence that actually our yield on cost will be quite significant on that mall. I'm expecting anything sort of more upper single digits.

The valuation cap rates that were used on the conversion of the MTLAs in China was about 5% to 6%, depending on the city and the quality of the asset overall, but broadly in line with market for well-located prime assets.

In some of our community malls, our Ring series, the one in Chongqing, had valued up as part of this because the yield on cost is quite high single digits now, it's not just the luxury Central series, it's also our Ring series which are performing Karl, what was your first question? Apologies.

Retail sales performance this year.

I think they've continued the trend, actually. Obviously we've got Chinese New Year trading, it's so early in the year, but sales have been quite robust in LANDMARK, and we haven't seen any change in that.

Thank you, management. This is Mark Leung from UBS.

I have a few questions. I think first of all will be regarding on the office outlook first.

Also is regarding on the geopolitics on Middle East. Do you think it will be a positive for our Singapore and Hong Kong office portfolio because of more maybe fund rotation?

I'm going to say yes because that's me.

Secondly would be more on the Central office. When do you see our rents could back to the peak?

Do you have a timeline for Hong Kong office rents to back to the previous peak? Also just from the Central office fund perspective, definitely we are at the bottom of the market.

A lot of the LP should be interested. What kind of signposts we should monitor to see that a fund of low opportunity could emerge?

For example, like HIBOR decline, commercial banks granting the CRE loan again. Keen to hear your thoughts about that.

I think that's all for my questions. Thank you.

Your first one, generally my personal view, maybe not a corporate, but I do think that for financial centers across the world that are strong and stable like Hong Kong and Singapore, I think any sort of uncertainty anywhere in the world, Hong Kong and Singapore end up being quite well-regarded, Craig Beattie (CFO): Maybe just on that point, I think it's well-known that a lot of hedge funds have moved actually to Dubai in particular. I think it's going to be interesting how Dubai is viewed post all these events, actually.

I think Hong Kong and Singapore, personally, I think will be net beneficiaries of some migration of talent back to this part of the world, where both of those locations are, I think, it's right to say, are regarded as safe havens and even on a tax point of view, fairly attractive tax rates. I hope that's beneficial for both our retail, for luxury goods, but also office, generally.

I think the signposts on the latter part around the fund overall, I think you're right to call out. I think it's linked to your second point around rental levels in Hong Kong.

Hong Kong office for us, if I start with retail maybe, retail, when COVID hit, market rents fell by 40% very quickly. The impact on our retail portfolio in the COVID years was more significant initially, but as we demonstrated, we've basically recovered our rental levels back to there.

Office is not the same story. The peak to trough in prime Central is down by about 40%.

We saw stabilization last year, mild growth starting to come through, and so we need to build from there. I think the open question is the pace of the growth.

I'm confident that there'll be growth, but the pace of it is the one that I think you're rightly asking about. There's no supply in Central.

The new supply that's come into the market in the last few years is now effectively absorbed for the best buildings, as Michael mentioned earlier. Actually, I do think we're getting to a point where there's going to be a tipping from a tenant market into a landlord market for the best buildings in Hong Kong.

Hong Kong's still got way too much supply overall, but I think we've demonstrated consistently that flight to quality, people want to be in the best buildings, we want to be in Central Hong Kong. I think the ingredients are all there actually for quite significant rental growth.

We've seen it many, many times in Hong Kong. That sort of spiking of rents.

We've got some resilient demand, hedge funds continue to grow, we are, I think, now officially the largest wealth capital center globally based on flows. Given what's happened in the Middle East, I don't see that changing.

Again, IPO capital markets is up. A lot of good things are in the mix, and so hopefully we see some good rental growth coming through overall.

I think that actually is also linked to the fund question because ultimately any investor wants to see growth in any market. It's what underpins the returns.

SC PREF in Singapore, ultra-prime assets, a low yield, but very strong outlook on rental growth. You take the yield plus the growth plus the benefits of low interest rate leverage, and you've got an 8% return.

Hong Kong doesn't have that type of return at this point, and so we need to see a return to growth and also some favorable interest rates, and then I think we're well-placed to do something then. Yep.

100% agreed. Please.

Hi. I have two questions.

Simon from Goldman Sachs. The first question, just back to the AUM business.

I think Michael, you did mention that Singapore market turn in a bit more active and that you so very much wanted to go to other markets. Perhaps can you share with us what other market you will be interested in, what's our observation you have seen so far in the last couple months?

Then second questions, just on the monetization point, you mentioned, I think Craig, that there's a build-to-sell properties that's still sitting in your book to be disposed by 2028. Can you give us that number, how much is still on your book?

Secondly, just on your Ring or the other rental property in China that you are planning to inject into this fund management business, what is the size of that portfolio?

Maybe if I hit those questions just before I'll pass to Michael in the first. Our gross assets built to sell at the end of last year across the whole region is $2.9 billion.

Our net take from that, once we recycle the 2.9, pay down any joint venture debt and liabilities, is about $1.4 billion. In terms of the net cash benefit going forward, Michael was talking about how should you value build-to-sell, DCF, that's basically your gross number that you need to look at.

If I go back to when we announced the strategy and we said that we wanted to recycle $10 billion, and of that $10 billion, 3 was from the build-to-sell, the fact there's 1.4-ish left to go basically tells you that we've recycled half of the capital already. That's the stats on build-to-sell.

On the MTLA assets, that pool of capital has got a value, our share, of close to $4 billion.

I think in terms of other markets, back in October '24, the intention of our announcement was, ideally for us, would be peerless. We'd love to be in the gateway cities of Asia, the cities that have financial centers, have a stock exchange, have centers of high net worth.

We'd love to have projects such as this or what we've got in Marina Bay or what we're building in Shanghai and really potentially have those assets attached to third-party capital that are being valued independently, all you guys understand that these are the asset values and no longer apply a discount. Ideally, that's what it is.

In terms of what are other financial city centers like Singapore, Hong Kong, and Shanghai, it's Tokyo, Seoul, and Sydney. There's a bunch of activity, a bunch of time, and we've hired people in different markets, and we hopefully can make some announcements.

Those are the cities that really echo most with us, that if we had similar scale in each of these cities, there wouldn't be anyone like Hongkong Land. We'd be quite peerless, and you'd have to then value those individual parts.

The more that we can help you value them like we're doing in Singapore with SC PREF, the easier it is for you to value.

Maybe if we jump to a few questions that have been submitted online. I think Rachel Tan from Macquarie.

Hey, Rachel. I think she's been typing all morning because she's got lots of questions.

Let me just read some of these out. I think we've answered some already, but first of all, dividend payout ratio, how should we think about that going forward relative to profit?

I answered that question with Karl, hopefully that's dealt with. Two, West Bund Central, how should we expect earning contributions from this portfolio to materialize as it progressively opens?

I think on this one, West Bund is a huge project, 18 million square feet in totality, being built in phases. The whole project will not complete until 2029.

We have opened phase one, phase two is in the process of opening, as Michael shared. Really the way the project was designed is that the largest component parts of the development are actually towards the end, 2028, 2029.

What that means in terms of rental income, in terms of the materiality of it, it's not going to be that big a contributor to Hongkong Land until really 2028 onwards. Similar to any new asset that opens, there's obviously a stabilization phase in the first few years.

Really this will be more material probably from 2030 onwards as the development sort of matures overall. I think for us, the key thing is ensuring that the development is positioned appropriately.

What I mean by that is that we continue to attract some of the world's best luxury brands, retail brands, and multinationals, and as Michael shared, we have done that so far. Good progress being made, but a lot more to do, generally.

Rachel's also asking about what drove the valuation gains in Hong Kong Central. It's basically the retail.

Office was flat, but the retail, because of the growth in Tomorrow's CENTRAL, drove a 15% increase in retail last year, which is strong, generally. I think have I covered everything?

Impairments in China, do you expect any more impairments after taking impairments in each of the last 2 years? I think here a few things to say.

We decided to exit the China built-to-sell or, in fact, all our build-to-sell business, and so we are focused on velocity of sales. To encourage sales in China in a very difficult market, we need to make sure we're competitive.

We do review the pricing from time to time. We did a big review in the second half of last year on our pricing, and we took some big reductions, which has benefited sales.

Sales went up towards the end of last year. The intention with that review is really to try and, obviously, benefit recycling.

We will continue to monitor how the market goes. Things have not really improved in China, nor do I expect them to improve in the next couple of years.

It's not easy, but I think in terms of impairments, we've done all we think we need to do at this point in time overall.

Just to supplement that valuation point. Just thinking about the investment that we have made in Tomorrow's CENTRAL, when we announced, we said it was a $1 billion investment, 40% from Hongkong Land and 60% from our tenant partners.

That 40% or $400 million US, which were actually under budget on, but just the valuation gain, forget the incremental earnings that we're going to get off that investment, the valuation gains is already multiple of that investment. It's not just the earnings uptick, if you want to look at how we deploy capital, that's a good example.

Sarah?

Congratulations on the results. Great to see.

Craig already mentioned, I guess, Hong Kong's relative positioning from a safety point of view given everything that's happening in the Middle East. If we look at AI, I think that's coming a lot faster and we'll see how that plays out than many expected.

You can play forward to that leading to huge taxation changes at a government level so that they can pay for other things. Obviously, Hong Kong should be incredibly attractive on that sense as well.

I wonder, given the pace of everything that's changing, when you're talking to tenants about 10-year office leases, are you starting to see any changes in terms of what they're looking for, the number of people, the office versus work from home, configurations, anything that we can glean?

I think that the work-from-home point has never really been a massive issue in Hong Kong for all sorts of the reasons that we know, right? Singapore more, and I think we saw more of an impact on that during the COVID period.

I think what's been a bigger discussion more recently has been growth. Growth of people's businesses.

Singapore has continued to expand, generally rents are up. In Hong Kong, because of the capital markets activities, the conversations we're having with tenants now compared to 12, 18 months ago is night and day.

It was talking to law firms who were cutting head count, they're now having to think about how they handle the workload. To your point on AI, they are using more tools in that way to try and help and manage, and therefore in many respects, I think it limits maybe the growth potential of some of the tenants in terms of their space demand.

Actually what it means is, again it comes back to where do these tenants want to be from an office point of view. The flight-to-quality point, I think, is critical.

Two, Hong Kong has no additional land, the ability to build anything new is incredibly limited. I think the third point I do remind people, in fact, we discussed at our board yesterday on AI, Hong Kong, prime CBD, the nature of people that are here doing business is not necessarily as impacted as much by AI as a back office maybe or in a second-tier city overall.

Personally, I think that globally top-tier cities will continue to see strong demand for office. What happens in second- and third-tier cities, I think, is going to be very different.

Where you invest your capital, how you invest it, and we kind of went through this as a board and as a management team in '24, because when we looked at our strategy and where the growth opportunities were, we continue to have a strong conviction on office, prime office in key gateway cities, even when we factored in potential disruptive impacts from AI.

Which is why we focus on gateway cities, because of that uncertainty around some other cities.

There's a couple of other questions online from Nicholas at CreditSights. With the net capital recycling proceeds, could management give a guidance on how much would be allocated to further debt reduction?

Maybe just to say here, recycling capital was to increase investment capacity. It wasn't to cut the debt of the group.

Hongkong Land has always been a very strong, well-resourced business with sort of strong credit ratings. We didn't need to reduce the debt, we weren't an overleveraged company.

As we recycle capital, the net debt's gone down, but as we look forward, we are looking to deploy capital into acquisitions, it's not so much about having a net debt target as more just creating headroom for growth. As I said, we've got liquidity at the group level of about $3.5 billion, we're actually well-placed to make some new investments going forward.

Then's a question here about credit rating impacts as we shift from build to sell and wind that down. Obviously, there's a temporary earnings impact, and does the company see any rating downgrade pressure?

We have obviously ratings with S&P, Moody's that are investment grade and very strong and have been stable for some time. In terms of their immediate views on our strategy, they actually were very supportive because cash is coming in, debt's going down.

I think their views on our ratings looking forward is more about the pace of expansion, how the expansion is structured, and how debt or further debt is used potentially in new fund structures. I'm not anticipating any change to our investment grade ratings in the near term, but ultimately how the rating agencies think about us is kind of within management team's control because how we control the pace of our expansion and the way that we do it, we will look to ratings and have a view on that, generally.

In fact, just to remind everyone, we announced in October '24, we set ourselves some financial guardrails. We're not going to lose our investment-grade rating, we're not going to go and issue equity, we're not going to do a $2 billion rights issue or anything like that.

Those are things that are really focused. That investment-grade rating is absolutely critical to us.

Michael, there's one question maybe for you from Joe Ho at Rondell. Any progress in C-REITs in the mainland China?

We watch it, lots of bankers come and see us. It's good to see people like CapitaLand and some of the foreign non-sort of domestic owners of real estate go into the C-REIT market.

There's a couple of things for us. Some of our assets are still not sufficiently stabilized, we want to make sure that we've got 2 or 3 years of sort of earnings history before we look at it, but it's definitely something that we want to think about and look at, but it's probably too premature for us right now.

Part of the reason why Alvin is now going to be looking after all of those assets is to shine a torch and make sure that we're organizationally, operationally efficient, if the opportunity arises either in a pre-IPO format or a C-REIT format, that we're ready to go.

Maybe just to round out, there's a couple of questions again from Rachel and also John at Schroders around return on equity and do we have a target? Are we thinking about it?

I think in terms of shareholder returns, improving return on equity is absolutely a focus. Having a clear capital allocation framework, which we do, is in no small part because we want to improve returns on capital overall.

It's not an easy thing for us to fix overnight though because of the weighting of the Hong Kong portfolio, which is some of the best and most prime assets in the world, which has a very low yield. As we expand into fund management and over time increase that exposure and grow the AUM in a more asset-light way, it's natural that the ROE will go up.

I think as we evolve our structure around the portfolios, as Michael took us through, we will also be evolving our reporting disclosures because I think it's important, as we try and encourage you to value us on the sum-of-the-parts basis, that we provide more insights. Some clarity around some of our new growth areas and the return on capital are things that we intend to be disclosing more of in the future.

Wonderful. Thank you so much, everyone, for joining us.

Please walk around Hong Kong Central and see all the activities that are taking place, and we'll see you at the next briefing. Thank you.

Thank you.