SPH REIT Prospectus (17 July 2013)

7/28/2019 SPH REIT Prospectus (17 July 2013)

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This document is important. If you are in any doubt as to the action you should take, you should consult your stockbroker,bank manager, solicitor, accountant or other professional adviser.

SPH REIT Management Pte. Ltd., as manager (the Manager) of SPH REIT (SPH REIT), is making an offering (theOffering) of 308,884,000 units representing undivided interests in SPH REIT (Units) for subscription at the OfferingPrice (as defined below) (the Offering Units). The Offering consists of (i) an international placement of 224,902,000Units to investors, including institutional and other investors in Singapore (the Placement Tranche) and (ii) an offeringof 83,982,000 Units to the public in Singapore (the Public Offer).The issue price of each Unit under the Offering (the Offering Price) will be S$0.90 per Unit. The sole global coordinatorand issue manager for the Offering is Credit Suisse (Singapore) Limited (the Global Coordinator or Sole GlobalCoordinator and Issue Manager). The Offering is fully underwritten at the Offering Price by Credit Suisse (Singapore)Limited, DBS Bank Ltd. and Oversea-Chinese Banking Corporation Limited (collectively, the Joint Bookrunners andUnderwriters or the Joint Bookrunners) on the terms and subject to the conditions of the Underwriting Agreement(as defined herein).

The total number of Units in issue as at the date of this Prospectus is one Unit (the Sponsor Initial Unit). The totalnumber of outstanding Units immediately after completion of the Offering will be 2,500,995,000 Units. The exercise ofthe Over-Allotment Option will not increase the total number of Units in issue. Concurrently with, but separate from theOffering, nominees of Orchard 290 Ltd (O290) and nominees of CM Domain Pte. Ltd ( CM Domain, together with

O290, the Vendors and each, a Vendor), as vendors of the Properties (as defined herein), will receive an aggregateof 1,941,110,999 Units (the Consideration Units) on the Listing Date (as defined herein) in part satisfaction of thepurchase consideration for the Properties. In addition, concurrently with, but separate from the Offering, each of theCornerstone Investors (as defined herein) has entered into a subscription agreement to subscribe for an aggregate of251,000,000 Units (the Cornerstone Units) at the Offering Price conditional upon the Underwriting Agreement havingbeen entered into, and not having been terminated, pursuant to its terms on or prior to the Settlement Date (as definedherein).Prior to the Offering, there has been no market for the Units. The offer of Units under this Prospectus will be by wayof an initial public offering (IPO) in Singapore. Application has been made to Singapore Exchange Securities TradingLimited (the SGX-ST) for permission to list on the Main Board of the SGX-ST (i) all Units comprised in the Offering,(ii) the Sponsor Initial Unit, (iii) the Consideration Units, (iv) the Cornerstone Units, (v) all the Units which will be issued tothe Manager from time to time in full or part payment of the Managers fees and (vi) all the Units which will be issued toSPH Retail Property Management Services Pte. Ltd. (the Property Manager) from time to time in full or part paymentof the Property Managers fees. Such permission will be granted when SPH REIT has been admitted to the Official Listof the SGX-ST (the Listing Date). Acceptance of applications for Units will be conditional upon issue of the Units andupon permission being granted to list the Units. In the event that such permission is not granted or if the Offering is notcompleted for any other reason, application monies will be returned in full, at each investors own risk, without interestor any share of revenue or other benefit arising therefrom, and without any right or claim against any of SPH REIT, theManager, DBS Trustee Limited, as trustee of SPH REIT (the Trustee), Singapore Press Holdings Limited ("SPHL" or the"Sponsor"), the Global Coordinator or the Joint Bookrunners.

SPH REIT has received a letter of eligibility from the SGX-ST for the listing and quotation of (i) all Units comprised in theOffering, (ii) the Sponsor Initial Unit, (iii) the Consideration Units, (iv) the Cornerstone Units, (v) all the Units which will beissued to the Manager from time to time in full or part payment of the Managers fees and (vi) all the Units which will beissued to the Property Manager from time to time in full or part payment of the Property Managers fees on the Main Boardof the SGX-ST. SPH REITs eligibility to list on the Main Board of the SGX-ST does not indicate the merits of the Offering,SPH REIT, the Manager, the Trustee, the Sponsor, the Global Coordinator, the Joint Bookrunners or the Units. The SGX-STassumes no responsibility for the correctness of any statements or opinions made or reports contained in this Prospectus.Admission to the Official List of the SGX-ST is not to be taken as an indication of the merits of the Offering, SPH REIT, theManager, the Trustee, the Sponsor, the Global Coordinator, the Joint Bookrunners or the Units.

The collective investment scheme offered in this Prospectus is an authorised scheme under the Securitiesand Futures Act, Chapter 289 of Singapore (the Securities and Futures Act or SFA). A copy of thisProspectus has been lodged with and registered by the Monetary Authority of Singapore (the "Authority"or the MAS) on 9 July 2013 and 17 July 2013 respectively. The MAS assumes no responsibility for thecontents of the Prospectus. Registration of the Prospectus by the MAS does not imply that the Securities andFutures Act or any other legal or regulatory requirements have been complied with. The MAS has not, in anyway, considered the investment merits of the collective investment scheme. This Prospectus will expire on16 July 2014 (12 months after the date of the registration of this Prospectus).

See Risk Factors commencing on page 48 of this Prospectus for a discussion of certain factors to beconsidered in connection with an investment in the Units. None of the Manager, the Trustee, the Sponsor,the Global Coordinator or the Joint Bookrunners guarantees the performance of SPH REIT, the repayment ofcapital or the payment of a particular return on the Units.

Investors who are members of the Central Provident Fund (CPF) in Singapore may use their CPF Ordinary Accountsavings to purchase or subscribe for Units as an investment included under the CPF Investment Scheme OrdinaryAccount. CPF members are allowed to invest up to 35.0% of the Investible Savings (as defined herein) in their CPFOrdinary Accounts to purchase or subscribe for Units. Investors applying for Units by way of Application Forms (as definedherein) or Electronic Applications (both as referred to in Appendix G, Terms, Conditions and Procedures for Application forand Acceptance of the Units in Singapore) in the Public Offer will have to pay the Offering Price on application, subject toa refund of the full amount or, as the case may be, the balance of the application monies (in each case without interest orany share of revenue or other benefit arising therefrom), where (i) an application is rejected or accepted in part only, or (ii)if the Offering does not proceed for any reason.In connection with the Offering, the Joint Bookrunners have been granted an over-allotment option (the Over-AllotmentOption) by TPR Holdings Pte. Ltd. (the Unit Lender), a company incorporated in Singapore that is a wholly-ownedsubsidiary of the Sponsor, exercisable by Credit Suisse (Singapore) Limited (the Stabilising Manager) (or any of itsaffiliates or other persons acting on behalf of the Stabilising Manager), in consultation with the other Joint Bookrunners, infull or in part, on one or more occasions, only from the Listing Date but no later than the earliest of (i) the date falling 30days from the Listing Date; or (ii) the date when the Stabilising Manager (or any of its affiliates or other persons acting onbehalf of the Stabilising Manager) has bought, on the SGX-ST, an aggregate of 55,988,000 Units, representing 18.1% ofthe total number of Units in the Offering, to undertake stabilising actions to purchase up to an aggregate of 55,988,000Units (representing 18.1% of the total number of Units in the Offering), at the Offering Price. The exercise of the Over-Allotment Option will not increase the total number of Units outstanding. In connection with the Offering, the StabilisingManager (or any of its affiliates or other persons acting on behalf of the Stabilising Manager) may, in consultation withthe other Joint Bookrunners and at its discretion, over-allot or effect transactions which stabilise or maintain the marketprice of the Units at levels that might not otherwise prevail in the open market. However, there is no assurance that theStabilising Manager (or any of its affiliates or other persons acting on behalf of the Stabilising Manager) will undertakestabilising action. Such transactions may be effected on the SGX-ST and in other jurisdictions where it is permissible to doso, in each case in compliance with all applicable laws and regulations (including the SFA and any regulations thereunder).

Nothing in this Prospectus constitutes an offer for securities for sale in the United States of America ("United States" or"U.S.") or any other jurisdiction where it is unlawful to do so. The Units have not been, and will not be, registered under theUnited States Securities Act of 1933, as amended (the Securities Act) or the securities laws of any state of the UnitedStates and accordingly, may not be offered or sold within the United States (as defined in Regulation S under the SecuritiesAct (Regulation S)) except in certain transactions exempt from, or not subject to, the registration requirements of the

Securities Act. The Units are being offered and sold outside the United States in offshore transactions as defined in, andin reliance on, Regulation S.

Sole Global Coordinator and Issue Manager

Co-Lead Managers and Sub-Underwriters

CIMB Securities (Singapore) Pte. Ltd. Nomura Singapore Limited

Sponsored by Joint Bookrunners and Underwriters

PROSPECTUS DATED 17 JULY 2013 (Registered with the Monetary Authority of Singapore on 17 July 2013).

(a real estate investment trust constituted on 9 July 2013 under the laws of the Republic of Singapore)

OFFERING OF 308,884,000 UNITS(Subject to the Over-Allotment Option(as defined herein))

OFFERING PRICE:S$0.90 PER UNIT

A HIGH QUALITY RETAIL PROPERTY PORTFOLIO


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Exposure to a high quality retail property portfolio anchored by

Paragon, one of Singapores most iconic retail malls

Exposure to Paragon Mall a premier upscale retail mall Strategically located in the heart of Orchard Road 136 metres of prime Orchard Road frontage Duplex flagship stores of top international fashion brands 100% Committed Occupancy1

Exposure to Clementi Mall a mid-market suburban mallintegrated with a bustling transport hub Part of an integrated mixed-use development that includes HDB

(as defined herein) residential blocks and a bus interchange andis connected to the Clementi MRT station 100% Committed Occupancy1

Enjoys high footfall with over 27.1 million visitors in 2012

Strong brand recognition from shoppers and retail tenants

PARAGO

N

KEY INVESTMENT HIGHLIGHTSAN OPPORTUNITY TO INVEST IN A HIGH QUALITY RETAIL PROPERTYPORTFOLIO DELIVERING ATTRACTIVE RETURNS TO INVESTORS

1 Committed Occupancy means the occupancy rate based on all current leases in respect of the Properties including letters of offer accepted by t enants which are to be followed up with tenancy agreements to be signed by the parties and for which

a deposit has been paid 100% Committed Occupancy as at 28 February 2013

Unique exposure to Singapores robust retail and stronghealthcare services sector through Paragon Medical

Solid retail sector fundamentals Expanding population Growing international visitor arrivals Growing retail sales Modest supply of retail space

Positive retail rental and occupancy outlook

Exposure to the strong healthcare services sector Singapore medical tourism spending expected to grow at

8.3% CAGR (as defined herein) from 2011 to 20182

Real estate exposure to Singapores premier shopping

and tourist precinct, Orchard Road

Orchard Road has consistently been ranked as the mostvisited attraction in Singapore2

Recently ranked number one in The Most Beautiful Avenues ofthe World in International Survey 2011/2012 report conductedby French survey company Presence2


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PARAGON

A premier upscale retail mall and medical suite / office property located

in the heart of Orchard Road, Singapores most famous shopping and

tourist precinct

KEY PROPERTY STATISTICS1

Paragon

Average Independent Valuation S$2,500.0 million2

NLA (sq ft) 706,690Tenants 285Committed Occupancy 100%Projection Year FY2014 Net Property Income3 S$120.4 million4

Net Property Income Yield5 4.8%4

Paragon MallHigh Quality Tenant Base

Anchor Tenants Selected Specialty Stores

Marks & Spencer Ermenegildo ZegnaMetro GucciMuji Miu MiuParagon Market Place Prada

Salvatore FerragamoTods

Paragon Medical

Offering Exclusivity and Convenience

Hosts over 60 medical and dental specialist clinics and offices Strategically located in Orchard Road and within the Mount Elizabeth medical

cluster

1 As at 28 February 2013.2 Based on independent valuations by CBRE Pte. Ltd. ("CBRE") and DTZ Debenham Tie Leung (SEA) Pte Ltd ("DTZ").3 Net Property Income means Gross Revenue (as defined herein) less property expenses.4 Based on the Profit Forecast and Profit Projection (as defined herein), together with the accompanying assumptions in the

Prospectus.5 Net Property Income yield is calculated by using Projection Year FY2014 (as defined herein) Net Property Income over the average

independent valuation shown in the table above.


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THE CLEMENTI MALL

A mid-market suburban mall located in the centre of Clementi

town, an established residential estate in the west of Singapore

Popular destination for catchment residents for day-to-day

shopping, dining and entertainment

KEY PROPERTY STATISTICS1

The Clementi Mall

Average Independent Valuation2 S$570.5 million3

NLA (sq ft) 192,089Tenants 146Committed Occupancy 100%Projection Year FY2014 Net Property Income4 S$31.0 million5,6

Net Property Income Yield7 5.4%5,6

Strong & Diverse Tenant Mix

Anchor Tenants Selected Specialty Stores

BHG Department Store Charles & KeithClementi Public Library Cotton OnFoodfare G2000

FairPrice Finest The Body ShopBreadtalkOotoya Japanese Restaurant

1

As at 28 February 2013.2 Based on the independent valuations by CBRE and DTZ.3 The valuation takes into account the Income Support (as defined herein).4 Net Property Income means Gross Revenue less property expenses.5 Based on the Profit Forecast and Profit Projection, together with the accompanying assumptions in the Prospectus.6 Based on Guaranteed Income Amount (as defined herein). In the absence of Guaranteed Income Amount, Net Property Income

yield is 4.6%.7 Net Property Income yield is calculated by using Projection Year FY2014 Net Property Income over the average independent

valuation shown in the table above.


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REAL ESTATE EXPOSURE TO ORCHARD ROAD

THROUGH PARAGON, ONE OF SINGAPORESMOST ICONIC RETAIL MALLS

A UNIQUE COMBINATION WITHSUBURBAN RETAIL PROPERTY EXPOSURE THROUGH

THE CLEMENTI MALL

TOTAL PORTFOLIO VALUED AT OVER

S$3.0 BILLION1

A RESILIENT PORTFOLIO

100%COMMITTED OCCUPANCY2

45 MILLIONVISITORS IN 20123

DISTRIBUTION YIELD OF

5.79%FOR PROJECTION YEAR FY20144

Initial Portfolio -Valuation Breakdown1

Initial Portfolio -Net Property Income Breakdown5

Initial Portfolio -Gross Revenue Breakdown5

The Clementi MallS$570.5 million

18.6%


18.2%


19.2%

ParagonS$2,500.0 million

81.4%

ParagonS$58.5 million

81.8%

ParagonS$78.7 million

80.8%

1 Based on the independent valuations by CBRE and DTZ as at 28 February 2013. The Clementi Mall valuations take into account the Income Support.2 As at 28 February 2013.3 Combined for Paragon and The Clementi Mall. Paragon had approximately 18 million visitors and The Clementi Mall had approximately 27 million visitors in 2012.4 Based on the Offering Price of S$0.90 per Unit and the projected distribution yield for Projection Year FY2014, together with the accompanying assumptions in the Prospectus. Such yield will vary accordingly for investors who purchase Units in the

secondary market at a market price different from the Offering Price.


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Diverse and quality tenant base, providing stable and

resilient portfolio performance

The Clementi Mall has enjoyed 100% Committed Occupancy

since its official opening in May 2011

Experienced management team and committed Sponsor

with a proven track record

Experienced and professional management team

Track record in commercial real estate development

and management

Attractive valuation metrics with an initial portfolio that

delivers stable and consistent returns to investors

Offering Price represents a 0.9% premium to NAV (as defined herein)

SPH REIT aims to provide Unitholders (as defined herein) with

regular and stable distributions on a quarterly basis. Its policy

is to distribute 100% of its Specified Taxable Income (as defined

herein) from the Listing Date to 31 August 2014. Thereafter, at

least 90% of Specified Taxable Income

Alignment of interest between the Sponsor and Unitholders

SPH to hold at least 70% stake in SPH REIT immediately

following the IPO

ROFR (as defined herein) to acquire the Sponsors completed

income-producing real estate located in Asia Pacific which

is used primarily2 for retail purposes. Currently, there is one

applicable property being The Seletar Mall, a 283,854 sq ft GFA

suburban lifestyle mall slated for completion by December 2014

Conservative capital structure

Aggregate leverage of 27.3% with staggered loan maturities of

three, five and seven year terms

CLEMEN

TI

THE

MALL

1 Based on the Offering Price of S$0.90 per Unit and the forecast and projected distribution yield for the period from 1 March 2013 to 31 August 2013 (Forecast Period 2H FY2013) (annualised) and Projection Year FY2014, respectively, together with thei ti i th P t S h i ld ill di l f i t h h U it i th d k t t k t i diff t f th Off i P i

Completion of ION Orchard(2009), Orchard Central (2010)and 313@Somerset (2010)(1,179,600 sq ft in total)

Source : Appendix F, "Independent Retail Property Market Research Report".1) Orchard Road rent index reflects ground floor tenants only on a quarterly basis.2) Paragon Mall retail rent index reflects retail tenants on a monthly average basis.

Paragon Mall rent index and Committed Occupancy for the period

from FY2003 to FY2012

FY2003

SARS Globalfinancial crisis

FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012

1001100

1842

Paragon Mall Committed Occupancy (100%) Paragon Mall retail rent index Orchard Road rent index

Key asset enhancement initiatives to remain market relevant ...

2002 to 2003:

Amalgamation of Paragonwith The Promenade

2006 to 2007:

Addition of 1 floor ofmedical suite / office

2012:

External upgrading works,extension of plaza andaddition of new taxi /coach bay and driveway

2008 to 2009:

S$82m asset enhancement(i) Facade upgrading(ii) Expansion of prime retail space

(11,000 sq ft in total)(iii) Addition of 2 floors of medical suite /

office (29,000 sq ft in total)

Forecast Period 2H FY2013 (annualised)

5.58%

Projection Year FY2014

5.79%

Distribution yield1

Note : Inclusive of income support for The Clementi Mall


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IMPORTANT DATES

EVENT DATE & TIME

Public Offer Starts 17 July 2013, 6:00 p.m.

Public Offer Ends 22 July 2013, 12:00 noon

Listing on the SGX-ST 24 July 2013, 2:00 p.m.

INTRODUCTION TO

SPH REIT & SPONSOR

SPH REIT is a Singapore-based REIT establishedprincipally to invest, directly or indirectly, in a portfolioof income-producing real estate which is usedprimarily for retail purposes in Asia-Pacific,as well as real estate-related assets

Sponsored by Singapore Press Holdings Limited,Southeast Asias leading media organisation

ABOUT THE REIT MANAGER

The REIT Manager is SPH REIT Management Pte. Ltd.,a wholly-owned subsidiary of the Sponsor

The REIT Managers key objective is to provideUnitholders with regular and stable distributions, and

sustainable long-term growth in DPU (as definedherein) and NAV per unit, while maintaining anappropriate capital structure

INVESTMENT STRATEGIES

Actively manage and enhance SPH REITs properties

Assess acquisition opportunities in line with the REITsinvestment objective

Manage and source capital to maximise returns


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TABLE OF CONTENTS

Page

NOTICE TO INVESTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i ii

FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v

CERTAIN DEFINED TERMS AND CONVENTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi

MARKET AND INDUSTRY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v ii

OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

OWNERSHIP OF THE UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74

CAPITALISATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

UNAUDITED PRO FORMA FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . 76

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

PROFIT FORECAST AND PROFIT PROJECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92

STRATEGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102

BUSINESS AND PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

THE MANAGER AND CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132

THE SPONSOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158

THE FORMATION AND STRUCTURE OF SPH REIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160

CERTAIN AGREEMENTS RELATING TO SPH REIT AND THE PROPERTIES . . . . . . . . 171

TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205

PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 210

CLEARANCE AND SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220

EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221

REPORTING AUDITORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 222

GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223

GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228

i


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APPENDIX A REPORTING AUDITORS REPORT ON THE PROFIT FORECAST

AND PROFIT PROJECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

APPENDI X B REPORTI NG AUDITORS REPORT ON T HE UNAUDI TED

PRO FORMA FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . B-1

APPENDIX C UNAUDITED PRO FORMA FINANCIAL INFORMATION . . . . . . . C-1

APPENDIX D INDEPENDENT TAXATION REPORT . . . . . . . . . . . . . . . . . . . . . . D-1

APPENDIX E INDEPENDENT PROPERTY VALUATION SUMMARY REPORTS. E-1

A PP EN DIX F IND EP EN DE NT RE TA IL P ROPER TY MAR KE T R ES EA RC H

REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1

APPENDIX G TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION

FOR AND ACCEPTANCE OF THE UNITS IN SINGAPORE . . . . . G-1

APPENDIX H LIST OF PRESENT AND PAST PRINCIPAL DIRECTORSHIPS OF

DIRECTORS AND EXECUTIVE OFFICERS . . . . . . . . . . . . . . . . . H-1

ii


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NOTICE TO INVESTORS

No person is authorised to give any information or to make any representation not contained in

this Prospectus and any information or representation not so contained must not be relied upon

as having been authorised by or on behalf of SPH REIT, the Manager, the Trustee, the Global

Coordinator, the Joint Bookrunners or the Sponsor. If anyone provides you with different or

inconsistent information, you should not rely upon it. Neither the delivery of this Prospectus nor

any offer, subscription, sale or transfer made hereunder shall under any circumstances imply that

the information herein is correct as of any date subsequent to the date hereof or constitute a

representation that there has been no change or development reasonably likely to involve a

material adverse change in the affairs, conditions and prospects of SPH REIT, the Manager, the

Units or the Sponsor since the date on the front cover of this Prospectus. Where such changes

occur and are material or required to be disclosed by law, the SGX-ST and/or any other regulatory

or supervisory body or agency, the Manager will make an announcement of the same to the

SGX-ST and, if required, lodge and issue a supplementary document or replacement document

pursuant to Section 298 of the Securities and Futures Act and take immediate steps to comply with

the said Section 298. Investors should take notice of such announcements and documents and

upon release of such announcements and documents shall be deemed to have notice of such

changes.

None of SPH REIT, the Manager, the Trustee, the Global Coordinator, the Joint Bookrunners and

the Sponsor or any of their respective affiliates, directors, officers, employees, agents,

representatives or advisers is making any representation or undertaking to any purchaser or

subscriber of Units regarding the legality of an investment by such purchaser or subscriber under

appropriate legal, investment or similar laws. In addition, investors in the Units should not

construe the contents of this Prospectus as legal, business, financial or tax advice. Investors

should be aware that they may be required to bear the financial risks of an investment in the Units

for an indefinite period of time. Investors should consult their own professional advisers as to the

legal, tax, business, financial and related aspects of an investment in the Units.

Copies of this Prospectus and the Application Forms may be obtained on request, subject to

availability, during office hours, from:

Credit Suisse

(Singapore) Limited

DBS Bank Ltd. Oversea-Chinese Banking

Corporation Limited

One Raffles Link

#03/#04-01 South Lobby

Singapore 039393

12 Marina Boulevard

Level 46

DBS Asia Central @

Marina Bay Financial

Centre Tower 3

Singapore 018982

65 Chulia Street

OCBC Centre

Singapore 049513

and, where applicable, from members of the Association of Banks in Singapore, members of the

SGX-ST and merchant banks in Singapore. A copy of this Prospectus is also available on the

SGX-ST website: http://www.sgx.com.

The Units have not been, and will not be, registered under the Securities Act and accordingly, may

not be offered or sold within the United States except in certain transactions exempt from, or not

subject to, the registration requirements of the Securities Act. The Units are being offered and sold

outside the United States in offshore transactions as defined in, and in reliance on, Regulation S.

iii


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The distribution of this Prospectus and the offering, subscription, purchase, sale or transfer of the

Units in certain jurisdictions may be restricted by law. SPH REIT, the Manager, the Trustee, the

Global Coordinator, the Joint Bookrunners and the Sponsor require persons into whose

possession this Prospectus comes to inform themselves about and to observe any such

restrictions at their own expense and without liability to SPH REIT, the Manager, the Trustee, the

Global Coordinator, the Joint Bookrunners and the Sponsor. This Prospectus does not constitute,

and the Manager, the Trustee, the Global Coordinator, the Joint Bookrunners and the Sponsor are

not making, an offer of, or an invitation to subscribe for or purchase, any of the Units in anyjurisdiction in which such offer or invitation would be unlawful. Persons to whom a copy of this

Prospectus has been issued shall not circulate to any other person, reproduce or otherwise

distribute this Prospectus or any information herein for any purpose whatsoever nor permit or

cause the same to occur.

In connection with the Offering, the Stabilising Manager (or any of its affiliates or other persons

acting on behalf of the Stabilising Manager) may, in consultation with the other Joint Bookrunners

and at its discretion, over-allot or effect transactions which stabilise or maintain the market price

of the Units at levels that might not otherwise prevail in the open market. However, there is no

assurance that the Stabilising Manager (or any of its affiliates or other persons acting on behalf

of the Stabilising Manager) will undertake stabilising action. Such transactions may be effected onthe SGX-ST and in other jurisdictions where it is permissible to do so, in each case in compliance

with all applicable laws and regulations (including the SFA and any regulations thereunder). Such

transactions may commence on or after the Listing Date, and, if commenced, may be discontinued

at any time and shall not be effected after the earliest of (i) the date falling 30 days from the Listing

Date; or (ii) the date when the Stabilising Manager (or any of its affiliates or other persons acting

on behalf of the Stabilising Manager) has bought, on the SGX-ST, an aggregate of 55,988,000

Units, representing 18.1% of the total number of Units in the Offering, to undertake stabilising

actions to purchase up to an aggregate of 55,988,000 Units (representing 18.1% of the total

number of Units in the Offering), at the Offering Price. The exercise of the Over-Allotment Option

will not increase the total number of Units outstanding.

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FORWARD-LOOKING STATEMENTS

Certain statements in this Prospectus constitute forward-looking statements. This Prospectus

also contains forward-looking financial information in Profit Forecast and Profit Projection. Such

forward-looking statements and financial information involve known and unknown risks,

uncertainties and other factors which may cause the actual results, performance or achievements

of SPH REIT, the Manager, the Sponsor, or industry results, to be materially different from any

future results, performance or achievements expressed or implied by such forward-looking

statements and financial information. Such forward-looking statements and financial information

are based on numerous assumptions regarding the Managers present and future business

strategies and the environment in which SPH REIT, the Manager or the Sponsor will operate in the

future. As these statements and financial information reflect the current views of the Manager and

the Sponsor concerning future events, these statements and financial information necessarily

involve risks, uncertainties and assumptions. Actual future performance could differ materially

from these forward-looking statements and financial information. You should not place any undue

reliance on these forward-looking statements.

Among the important factors that could cause the actual results, performance or achievements of

SPH REIT, the Manager or the Sponsor to differ materially from those in the forward-lookingstatements and financial information are the conditions of, and changes in, the domestic, regional

and global economies, including, but not limited to, factors such as political, economic and social

conditions in Singapore, changes in government laws and regulations affecting SPH REIT,

competition in the property market of Singapore in which SPH REIT may invest, industry, interest

rates, inflation, relations with service providers, relations with lenders, hostilities (including future

terrorist attacks), the performance and reputation of SPH REITs properties and/or acquisitions,

difficulties in identifying future acquisitions, difficulty in completing and integrating acquisitions,

changes in the Managers directors and executive officers, risks related to natural disasters,

general volatility of the capital markets, general risks relating to the property market in which SPH

REIT may invest and the market price of the Units as well as other matters not yet known to the

Manager or not currently considered material by the Manager. Additional factors that could cause

actual results, performance or achievements to differ materially include, but are not limited to,

those discussed under Risk Factors, Profit Forecast and Profit Projection, and Business and

Properties. These forward-looking statements and financial information speak only as at the date

of this Prospectus. The Manager expressly disclaims any obligation or undertaking to release

publicly any updates of or revisions to any forward-looking statement or financial information

contained herein to reflect any change in the expectations of the Manager or the Sponsor with

regard thereto or any change in events, conditions or circumstances on which any such statement

or information is based, subject to compliance with all applicable laws and regulations and/or the

rules of the SGX-ST and/or any other relevant regulatory or supervisory body or agency.

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CERTAIN DEFINED TERMS AND CONVENTIONS

SPH REIT will publish its financial statements in Singapore dollars. In this Prospectus, references

to S$ or Singapore dollars and cents are to the lawful currency of the Republic of Singapore.

Unless otherwise defined, capitalised terms used in this Prospectus shall have the meanings set

out in the Glossary.

The forecast and projected distribution per Unit yields are calculated based on the Offering Price.

Such yields and yield growth will vary accordingly for investors who purchase Units in the

secondary market at a market price different from the Offering Price.

Any discrepancies in the tables, graphs and charts included in this Prospectus between the listed

amounts and totals thereof are due to rounding. Where applicable, figures and percentages are

rounded to one decimal place. Measurements in square metres (sq m) are converted to square

feet (sq ft) and vice versa based on the conversion rate of 1 sq m = 10.7639 sq ft. References

to Appendix or Appendices are to the appendices set out in this Prospectus. All references in

this Prospectus to dates and times shall mean Singapore dates and times unless otherwise

specified.

Unless otherwise specified, all information relating to the Properties in this Prospectus are as at

28 February 2013. (See Business and Properties for details regarding the Properties.)

For the purposes of this Prospectus, reference to:

Clementi Mall means a 99-year leasehold interest in The Clementi Mall commencing on 31

August 2010;

FY means financial year ended or, as the case may be, ending 31 August;

Gross Rental Income consists of Fixed Rent which includes (i) base rent (after rent

rebates, refunds, credits or discounts and rebates for rent-free periods, where applicable, but

excluding turnover rent), (ii) service charges payable by tenants to cover the operation and

property maintenance expenses of the respective Properties and (iii) advertising and

promotion charges payable by tenants for advertising and promotional activities for the

respective Properties (Fixed Rent); and Turnover Rent which is generally calculated as a

percentage of the tenants gross turnover (Turnover Rent). In some cases, turnover rent

may be subject to certain thresholds before it is payable;

Medical suites refers to medical suites and medical clinics;

Paragon in the context of what SPH REIT will be acquiring as part of its Initial Portfolio (asdefined herein) means a 99-year leasehold interest in Paragon commencing on the Listing

Date. (See Certain Agreements Relating to SPH REIT and the Properties Information

Regarding the Title of the Properties Paragon for further details); and

primarily when used in relation to the phrase primarily for retail purposes shall mean

more than 50.0% of net lettable area (NLA) or (in the case of a property where the concept

of NLA is not applicable) gross floor area (GFA).

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MARKET AND INDUSTRY INFORMATION

This Prospectus includes market and industry data and forecasts that have been obtained from

internal surveys, reports and studies, where appropriate, as well as market research, publicly

available information and industry publications. Industry publications, surveys and forecasts

generally state that the information they contain has been obtained from sources believed to be

reliable, but there can be no assurance as to the accuracy or completeness of such information.

The Manager has commissioned Urbis Pty Ltd (Urbis or the Independent Market Research

Consultant) to prepare the Independent Retail Property Market Research Report (see Appendix

F, Independent Retail Property Market Research Report for further details). While the Manager

has taken reasonable steps to ensure that the information is extracted accurately and in its proper

context, the Manager has not independently verified any of the data from third-party sources or

ascertained the underlying economic assumptions relied upon therein. Consequently, none of

SPH REIT, the Manager, the Trustee, the Sponsor, the Global Coordinator or the Joint

Bookrunners makes any representation as to the accuracy or completeness of such information

and shall not be obliged to provide any updates on the same.

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OVERVIEW

The following section is qualified in its entirety by, and is subject to, the more detailed information

contained or referred to elsewhere in this Prospectus. The meanings of terms not defined in this

section can be found in the Glossary or in the trust deed constituting SPH REIT dated 9 July 2013

(the Trust Deed). A copy of the Trust Deed can be inspected at the registered office of the

Manager, which is located at 1000 Toa Payoh North, News Centre, Singapore 318994.

Statements contained in this section that are not historical facts may be forward-looking

statements or are historical statements reconstituted on a pro forma basis. Such statements are

based on certain assumptions and are subject to certain risks and uncertainties which could cause

actual results of SPH REIT to differ materially from those forecast or projected (see Forward-

Looking Statements for further details). Under no circumstances should the inclusion of such

information herein be regarded as a representation, warranty or prediction with respect to the

accuracy of the underlying assumptions by SPH REIT, the Manager, the Trustee, the Global

Coordinator, the Joint Bookrunners, the Sponsor or any other person or that these results will be

achieved or are likely to be achieved. Investing in the Units involves risks. Prospective investors

are advised not to rely solely on this section, but to read this Prospectus in its entirety and, in

particular, the sections from which the information in this section is extracted and Risk Factors

to better understand the Offering and SPH REITs businesses and risks.

INTRODUCTION TO SPH REIT

SPH REIT is a Singapore-based real estate investment trust ( REIT) established principally to

invest, directly or indirectly, in a portfolio of income-producing real estate which is used primarily 1

for retail purposes in Asia-Pacific, as well as real estate-related assets.

Objective

The Managers key objective for SPH REIT is to provide unitholders of SPH REIT (Unitholders)

with regular and stable distributions, and sustainable long-term growth in distribution per Unit

(DPU) and net asset value (NAV) per Unit, while maintaining an appropriate capital structure.

Initial Portfolio

As at the Listing Date, the initial portfolio of SPH REIT (the Initial Portfolio) comprises two high

quality and well located commercial properties in Singapore totalling 898,779 sq ft NLA2 with an

aggregate appraised value of S$3,070.5 million3 and Committed Occupancy (as defined herein)

of 100.0% as at 28 February 2013. The Initial Portfolio consists of:

a 99-year leasehold interest4 in Paragon, a premier upscale retail mall and medical

suite/office property located in the heart of Orchard Road, Singapores most famous

shopping and tourist precinct. Paragon consists of a six-storey retail podium and onebasement level with 483,690 sq ft of retail NLA (Paragon Mall) with a 14-storey tower and

another three-storey tower sitting on top of the retail podium with a total of 223,000 sq ft of

medical suite/office NLA (Paragon Medical). The development is strategically located in

the heart of Orchard Road shopping and tourist precinct and is very well-known for its

upscale mall housing many luxury brands; and

1 For the avoidance of doubt, the term primarily shall mean more than 50.0% of NLA or (in the case of a propertywhere the concept of NLA is not applicable) GFA.

2 The calculation of the NLA for the Properties is based on the Property Managers record of letters of offer/leaseagreements.

3 This takes into account the Income Support (as defined herein).

4 Commencing on the Listing Date.

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a 99-year leasehold interest1 in The Clementi Mall (Clementi Mall), a mid-market

suburban mall located in the centre of Clementi town, an established residential estate in the

west of Singapore. The retail mall, which also houses a public library, is part of an integrated

mixed-use development that includes Housing Development Board (HDB) residential

blocks and a bus interchange. The property is connected to the Clementi mass rapid transit

(MRT) station. Clementi Mall consists of a five-storey retail podium and one basement level

with approximately 192,089 sq ft of retail NLA. Due to its location and strong transport

connectivity, Clementi Mall enjoys high levels of visitation with over 27.1 million visitors in2012,

(together, the Properties). (See Business and Properties for further details.)

Key Strategies

The Manager plans to achieve its objective through the following key strategies:

Proactive asset management and asset enhancement strategy The Manager will take

an active role in managing and enhancing SPH REITs properties. The Managers strategy

for organic growth will be to actively optimise the tenant mix of SPH REITs properties andto provide proactive property management services to tenants while also undertaking

periodic refurbishment of SPH REITs properties, as appropriate. Through active asset

management, the Manager seeks to ensure that the interests of all stakeholders, including

tenants, shoppers and Unitholders, are protected while keeping SPH REITs properties at the

forefront of evolving retail mall trends and relevant to the changing demands of consumers.

Investments and acquisition growth strategy The Manager intends to assess

acquisition opportunities in line with SPH REITs investment objective. SPH REIT will benefit

from the pipeline of income-producing properties (ROFR Properties and each a ROFR

Property) which could potentially be acquired from the Sponsor if the Sponsor chooses to

divest them. The Sponsor has granted a right of first refusal ( ROFR) over the ROFR

Properties to the Trustee for as long as:

the Manager or any of its related corporations (as defined in the Companies Act,

Chapter 50 of Singapore (the Companies Act)) remains the manager of SPH REIT;

the Sponsor and/or any of its related corporations, alone or in aggregate, remains as a

controlling shareholder2 of the manager of SPH REIT; and

the Sponsor and/or any of its related corporations, alone or in aggregate, remains as a

controlling unitholder3 of SPH REIT.

1 Commencing on 31 August 2010.

2 Controlling shareholder means (i) a person who holds directly or indirectly 15.0% or more of the nominal amountof all voting shares of the company or (ii) in fact exercises control over the company.

3 Controlling unitholder in relation to a REIT means (i) a person who holds directly or indirectly 15.0% or more ofthe nominal amount of all voting units in the REIT or (ii) in fact exercises control over the REIT.

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Currently, there is one applicable ROFR Property, The Seletar Mall1, which may be suitable

to be acquired by SPH REIT in the future2. The Sponsor will consider and participate in retail

development opportunities where appropriate, which may increase the number of ROFR

Properties. (See Strategy Investments and Acquisition Growth Strategy Acquisition

opportunities in respect of the ROFR Properties for further details.)

Capital and risk management strategy The Manager will seek to manage and source

capital so as to maximise overall returns for Unitholders. This may include accessing variouscapital markets to source appropriately priced and structured debt and equity, monitoring and

implementing hedging arrangements as well as assessing alternative forms of capital and

other capital management strategies where appropriate. The Manager may use fixed rate

loans or financial instruments such as interest rate swaps to hedge certain financial risk

exposures.

With respect to debt financing, the Manager intends to diversify, stagger and extend debt

maturities as the Manager deems appropriate, and mitigate interest rate volatility, so as to

optimise risk-adjusted returns to Unitholders.

KEY INVESTMENT HIGHLIGHTS

The Manager believes that an investment in SPH REIT offers the following attractions to

Unitholders:

(1) Exposure to a high quality retail property portfolio anchored by Paragon, one of

Singapores most iconic retail malls

(A) Exposure to Paragon Mall, a premier upscale retail mall in Orchard Road

(B) Exposure to Clementi Mall, a mid-market suburban mall integrated with a bustling

transport hub

(C) Strong brand recognition from shoppers and retail tenants

(2) Unique exposure to Singapores robust retail sector and strong healthcare services

sector through Paragon Medical

(A) Solid retail sector fundamentals

(B) Positive retail rental and occupancy outlook

(C) Exposure to the strong healthcare services sector

(3) Real estate exposure to Singapores premier shopping and tourist precinct, Orchard

Road

1 The Seletar Mall is owned by The Seletar Mall Pte. Ltd., which is in turn owned by Moon Holdings Pte. Ltd. andUnited Engineers Developments Pte. Ltd. which respectively hold 70.0% and 30.0% of the total number of ordinaryshares issued by The Seletar Mall Pte. Ltd. Moon Holdings Pte. Ltd. is a wholly-owned subsidiary of TimesProperties Private Limited (Times Properties), which is in turn a wholly-owned subsidiary of the Sponsor. UnitedEngineers Developments Pte. Ltd. is a wholly-owned subsidiary of United Engineers Limited.

2 Pursuant to the terms of the ROFR granted by the Sponsor, the Sponsor shall procure that The Seletar Mall be

offered to SPH REIT prior to any sale of The Seletar Mall to a third party. See Certain Agreements relating to SPHREIT and the Properties Right of First Refusal Agreement for further details.

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(4) Diverse and quality tenant base, providing stable and resilient portfolio performance

(A) Diverse and quality tenant base

(B) Stable and resilient portfolio performance

(5) Attractive valuation metrics with an Initial Portfolio that delivers stable and consistent

returns to investors

(6) Conservative capital structure

(7) Experienced management team and committed Sponsor with a proven track record

(A) Experienced and professional management

(B) Track record in commercial real estate development and management

(C) Alignment of interest between the Sponsor and Unitholders

Details of these key investment highlights are set out below.

(1) Exposure to a high quality retail property portfolio anchored by Paragon, one of

Singapores most iconic retail malls

SPH REIT provides investors with an opportunity to invest in an Initial Portfolio comprising

two high quality and strategically located properties with retail and medical suite/office

components delivering attractive returns to investors.

The table below sets out a summary of the Initial Portfolio as at 28 February 2013:

Initial Portfolio summary as at

28 February 2013 Paragon

Clementi

Mall

Initial

Portfolio

Property Type Retail and

medical

suite/office

Retail Retail and

medical

suite/office

GFA (sq ft) 1,017,707 289,877 1,307,584

NLA (sq ft) 706,690 192,089 898,779

Number of tenants 285 146 431

Committed Occupancy (%)(1) 100.0 100.0 100.0

2012 annual retail sales (S$m)(2) 738 228 966

Sales per sq ft retail NLA per month (S$) 130 114 125

Projection Year FY2014 Net Property

Income(3) (S$m)

120.4 31.0(4) 151.4(5)

Average independent valuation (S$m) 2,500.0 570.5(6) 3,070.5

Net Property Income yield(7) (%) 4.8 5.4(4) 4.9 (5)

Notes:

(1) Committed Occupancy means the occupancy rate based on all current leases in respect of the Propertiesincluding letters of offer accepted by tenants which are to be followed up with tenancy agreements to besigned by the parties and for which a deposit has been paid. Data as at 28 February 2013. All such lettersof offer accepted by tenants are binding on the parties. The property management team does not use lettersof intent (binding or non-binding).

(2) Based on annual retail sales of retail mall tenants only.

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(3) Net Property Income means Gross Revenue (as defined herein) less property expenses.

(4) Based on Guaranteed Income Amount (as defined herein). In the absence of Guaranteed Income Amount, NetProperty Income yield is 4.6%.

(5) Based on Guaranteed Income Amount of S$31.0 million per year for Clementi Mall. In the absence ofGuaranteed Income Amount, Net Property Income yield is 4.8%.

(6) The valuation takes into account the Income Support.

(7) Net Property Income yield is calculated by using FY2014 Net Property Income over the average independentvaluation shown in the table above.

(A) Exposure to Paragon Mall, a premier upscale retail mall in Orchard Road

Paragon is a premier upscale retail mall that is strategically located at the heart of

Singapores premier shopping and tourist precinct, Orchard Road. Paragon has

483,690 sq ft of retail NLA and 285 tenants, and features an all-glass facade with 136

metres of prime Orchard Road frontage, showcasing duplex flagship stores of top

international fashion brands such as Gucci, Miu Miu, Prada, Salvatore Ferragamo and

Tods.

Anchor tenants

Marks & SpencerMetro

MUJI Paragon Market Place

Selected specialty stores

Ermenegildo Zegna Gucci Miu Miu Prada Salvatore Ferragamo Tods

Paragon Mall A premier upscale retail mall

Source: Appendix F, Independent Retail Property Market Research Report.

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Paragons strategic location, extensive retail offerings and reputation attract customers

from all over Singapore and internationally.

The catchment and trade area

Trade area spanning the entire Singapore According to Urbis, Paragon has a

trade area spanning the entire Singapore population of 5.4 million1. Its primary

trade area of the central region of Singapore has a population of 1.6 million2 andenjoys higher levels of income and retail spend per capita compared to other

regions in Singapore. In 2013, the retail spend per capita in the central region is

estimated to be S$7,374. This is around 12.2% higher than the Singapore average

in 2013 and is estimated to grow at a compounded annual growth rate (CAGR)

of 2.9% to approximately S$8,522 per capita in 2018.

Significant catchment of tourists Tourists form an important market segment for

most of the retail malls in Orchard Road including Paragon. According to Urbis, in

2012, international visitor arrivals to Singapore totalled 14.4 million with an

estimated tourist expenditure of S$7.8 billion. Tourists are estimated to contribute

approximately 40.0% of Orchard Road retail sales. Orchard Road is also a popularhotel and serviced apartment location, with 33 hotels and serviced apartment units

along Orchard Road with more than 10,600 rooms, providing a large catchment of

tourists and business travellers. According to Singapore Tourism Boards (STB)

Singapore Annual Report on Tourism Statistics 2010/2011, Orchard Road is the

most visited tourist destination in Singapore3.

Important medical hub Paragon benefits from regular visitation by local patients

and medical tourists and their accompanying relatives by virtue of Paragons

location immediately adjacent to Mount Elizabeth Hospital and Mount Elizabeth

Medical Centre, a renowned private hospital and specialist medical centre,

respectively. In addition, Paragon houses Paragon Medical, comprising a 14-

storey tower and another three-storey tower sitting on top of the retail podium, thathosts over 60 medical and dental specialist clinics and offices. The specialist

clinics at Paragon Medical provide medical services ranging from cardiology,

orthopaedics, urology, dermatology, obstetrics, gynaecology, oncology, pediatrics,

dentistry and anti-ageing to traditional Chinese medicine. Paragon Medical caters

uniquely to patients and their accompanying relatives by providing the amenity of

a shopping precinct, cafe and dining venue before or after the patients medical

treatments.

1 Source: Appendix F, Independent Retail Property Market Research Report, Section 2.5.2 (Resident Trade AreaDefinition). Relevant figures are estimated as of 2013. Per Paragons location in Orchard Road, its very extensiveretail offer and Singapores excellent public transportation system which makes Orchard Road very accessible,Paragon is able to draw customers from all over Singapore.

2 Source: Appendix F, Independent Retail Property Market Research Report. Relevant figures are estimated as of2013.

3 Source: STB, Annual Report on Tourism Statistics 2010/2011. STB has not provided its consent, for the purposesof Section 249 of the SFA (read with Section 302(1) of the SFA), to the inclusion of the information extracted fromthe relevant report published by it and therefore is not liable for such information under Sections 253 and 254 of theSFA (both read with Section 302(1) of the SFA). While the Manager has taken reasonable actions to ensure that theinformation from the report published by STB is reproduced in its proper form and context, and that the informationis extracted accurately and fairly from such report, none of the Manager, the Global Coordinator, the Joint

Bookrunners or any other party has conducted an independent review of the information contained in such reportor verified the accuracy of the contents of the relevant information.

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Immediate catchment of workers in Orchard Road Paragon benefits from a

meaningful catchment of workers in the Orchard Road vicinity. For 2013, Urbis

estimates that there are currently around 62,200 workers in Orchard Road

generating an annual retail spend of S$255 million which is expected to rise to

S$296 million by 2018.

(B) Exposure to Clementi Mall, a mid-market suburban mall integrated with a bustling

transport hub

Clementi Mall opened officially in May 2011 with 100.0% Committed Occupancy. It is

strategically located in the centre of Clementi town in the west of Singapore. The retail

mall, which also houses a public library, is part of an integrated mixed-use development

that includes HDB residential blocks and a bus interchange. The property enjoys high

footfall as it is connected to the Clementi MRT station and is also easily accessible by

car from the expressways located directly next to Clementi Mall.

Clementi Mall A mid-market suburban mall integrated with a transportation hub

Anchor tenants

BHG Department StoreClementiPublic LibraryFoodfareFairPriceFinest

Selected specialty stores

Charles & KeithCotton OnG2000The Body ShopBreadtalkOotoya Japanese Restaurant


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Clementi Malls strategic location in an established residential area and integration with

a transportation hub allows it to attract a high number of visitors

The catchment and trade area

Catchment area that covers the surrounding established residential estates

Clementi Mall is strategically located in the heart of Clementi Town Centre with

excellent transport connectivity due to its co-location with a bus interchange andconnection to the Clementi MRT station. Urbis estimates that Clementi Mall serves

over 180,000 residents from its primary and secondary trade areas including the

surrounding Clementi town, West Coast, Holland Village and Bukit Timah

residential estates. According to Urbis, there are more than 63,000 students from

tertiary institutions in the area.

Captive customer base with limited competition in the primary trade area

Clementi Mall is located in the west of Singapore, which has very low shopping

centre floor space at 1.7 sq ft per capita that is significantly below the Singapore

average of 4.3 sq ft per capita. Within its primary trade area, the main competitor

is West Coast Plaza, which does not have a bus interchange or MRT stationnearby. Clementi Mall attracted over 27.1 million visitors in 2012. Accordingly,

Clementi Mall benefits from strong demand from shoppers in its primary trade

area.

High trade area retail spending According to Urbis, Clementi Malls primary and

secondary trade area has a retail spend that is above Singapores average. In

2013, retail spend per capita in the west region was estimated to be S$7,257,

10.5% higher than the Singapore average, and is estimated to grow at a CAGR of

2.9% to approximately S$8,374 per capita in 2018.

(C) Strong brand recognition from shoppers and retail tenants

Paragon Mall is one of the most established and well-known retail malls located in

Orchard Road. Paragon was first acquired by the Sponsor in 19971. Since then, the

Sponsor has extensively and continually upgraded the mall and optimised its tenant mix

in order to keep the property up-to-date with market preferences and expectations and

to meet the needs of retailers. The mall has since gained a positive reputation amongst

affluent shoppers for its extensive range of top international fashion brands, high street

and diffusion brands, wide food and beverage (F&B) offerings and gourmet

supermarket. After its facade enhancement in 2009, Paragon now features an all-glass

facade with 136 metres of prime Orchard Road frontage, showcasing duplex flagship

stores of top international fashion brands like Gucci, Miu Miu, Prada, Salvatore

Ferragamo and Tods.

Paragon Mall is positioned as an upscale mall targeting: (i) affluent and upmarket

shoppers with international fashion retailers such as Gucci, Miu Miu, Prada, Salvatore

Ferragamo, Tods, Burberry, Dunhill, Ermenegildo Zegna, Etro, Jimmy Choo, Marni and

Moschino; (ii) young upwardly mobile shoppers, with high street and diffusion brands,

like Adolfo Domnguez, Agnes B, AX Armani Exchange, Banana Republic, Blackbarrett,

CK Calvin Klein, DKNY, Evisu, Furla, G-Star, Karen Millen, Longchamp, Miss Sixty and

1 Times Properties acquisition of interests in the property owning companies that owned Paragon by Sogo and

Promenade. The remaining shares in the property owning companies which Times Properties did not own wereacquired in 2001.

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Raoul; and (iii) families, with quality childrens fashion and toy stores, like Armani Kids,

Club 21 Kids, Guess Kids, Petit Bateau, Toys R Us and Early Learning Centre. The mall

is underpinned by anchor tenants that are established favourites among locals, and

appeal to a wide range of shoppers, such as Metro (its only outlet on Orchard Road and

its largest in Singapore), Marks & Spencer, MUJI and Paragon Market Place. Paragon

Mall also distinguishes itself as a dining destination with a wide variety of casual and

fine dining options, comprising several cafes and Asian and western cuisine

restaurants. Two of Singapores well known fine dining Chinese restaurants, CrystalJade Golden Palace and Imperial Treasure Super Peking Duck Restaurant, have been

operating successfully in Paragon Mall for several years.

Since commencement of operations in 2011, Clementi Mall has quickly established

itself as a popular destination for residents within its catchment area due to its excellent

location, scale and transport connectivity. Clementi Mall is positioned as a

contemporary and mid-market mall catering to families, executives and students living

in its trade area and is anchored by familiar brands such as BHG Department Store and

FairPrice Finest and is well complemented by a variety of established F&B, fashion and

childrens wear stores.

(2) Unique exposure to Singapores robust retail sector and strong healthcare services

sector through Paragon Medical

Upon listing, SPH REIT will be one of the largest REITs listed on the SGX-ST focused on

Singapore retail property. The Manager believes that investing in SPH REIT provides

Unitholders with a unique combination of Orchard Road and suburban property exposure

with both retail and healthcare services (HCS) components. In addition, SPH REIT provides

the purest exposure to retail property in the Orchard Road precinct of any REIT listed on the

SGX-ST as a percentage of total asset value.

SPH REIT offers investors exposure to the attractive retail sector, with retail contributing

75.2% of NLA of the Initial Portfolio, and the strong HCS sector, with medical suite/officecontributing 24.8% of NLA of the Initial Portfolio as at 28 February 2013.

(A) Solid retail sector fundamentals

The Singapore retail sector is expected to continue to benefit from the following trends:

(i) an expanding population; (ii) growing international visitor arrivals; (iii) growing retail

sales; and (iv) modest supply of retail space.

(i) An expanding population

In 2013, Singapores population is forecasted to be approximately 5.4 million.Moreover, Singapores population is projected to continue its current trend of

growth, with the countrys population expected to reach 5.9 million in 2018,

representing a CAGR of 1.5% from 2013.

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The following chart shows the historical and forecast population of Singapore for

the period from 2005 to 2018:

Historical and forecast population of Singapore for the period 2005 to 2018

(in millions, calendar year)

4.22 4.40 4.594.84 4.99 5.08 5.18 5.31 5.43

5.52 5.62 5.70 5.78 5.85

Forecast

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018


(ii) Growing international visitor arrivals

Tourism has grown strongly in Singapore with an average annual growth rate of

16.6% over the period from 2009 to 2011. According to STB, the Singapore

government continues to actively enhance the business and tourism landscape of

Singapore to meet STBs target of 17 million tourist arrivals and S$30 billion in

tourism revenue by 20151. Urbis estimates that international visitor arrivals will

grow at an average annual rate of 5.0% from 15.4 million in 2013 to 19.3 million

in 2018.

The following chart shows the historical and forecast international visitor arrivals

in Singapore from 2001 to 2018:

Historical and forecast international visitor arrivals in Singapore for the period 2001 to 2018(in millions, calendar year)

7.5 7.6 6.18.3 8.9 9.8

10.3 10.1 9.711.6 13.2

14.4 15.416.3 17.1 17.8

18.5 19.3

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Forecast


1 Source: STB Tourism Performance Report Quarter Four and Full Year 2011. STB has not provided its consent, forthe purposes of Section 249 of the SFA (read with Section 302(1) of the SFA), to the inclusion of the informationextracted from the relevant report published by it and therefore is not liable for such information under Sections 253and 254 of the SFA (both read with Section 302(1) of the SFA). While the Manager has taken reasonable actionsto ensure that the information from the report published by STB is reproduced in its proper form and context, andthat the information is extracted accurately and fairly from such report, none of the Manager, the Global Coordinator,

the Joint Bookrunners or any other party has conducted an independent review of the information contained in suchreport or verified the accuracy of the contents of the relevant information.

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(iii) Growing retail sales

Retail sales growth in Singapore has historically been fairly strong with downturnscaused by external shocks including the terrorist attacks of September 11, 2001(9/11), the Severe Acute Respiratory Syndrome (SARS) epidemic in 2003 andthe global financial crisis in 2008 and 2009 (the GFC). According to Urbis, retailsales growth is expected to remain strong, growing at an average of 5.0% perannum from 2013 to 2018, driven by expanding private consumption expenditureand growth in the tourism retail spending market. Tourism retail spending growthis expected to outpace local retail spending.

The following chart shows the historical and forecast retail sales growth in

Singapore for the period 2001 to 2018:

(6.0%)(4.0%)(2.0%)

2.0%

4.0%

6.0%

8.0%

10.0%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Retail Sales Growth Nominal Retail Sales Growth

9/11 SARS GFC Forecast

Historical and forecast retail sales growth in Singapore for the period 2001 to 2018


(iv) Modest supply of retail space

By international standards, Singapore is under-supplied in terms of retail floorspace per capita, particularly for a country with a high standard of living. Urbisestimates that Singapore had 10.9 sq ft of total retail floor space per capita in 2012which is lower than other developed Asian economies.

The following chart shows the estimated total retail floor space per capita forselected developed countries and projected total retail floor space per capita ofSingapore in 2018:

Estimated total retail floor space (sq ft) per capita for selected developed countries

50.5

23.7

16.6

14.4

12.9

11.3

10.9

10.9

USA (2010)Australia (2012)

Japan (2009)South Korea (2010)

China (2012)Hong Kong (2012)Singapore (2012)Singapore (2018)


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(B) Positive retail rental and occupancy outlook

Orchard Road retail precinct

In 2012, the Orchard Road retail precinct emerged from a declining trend in rents

caused by the combined impact of the GFC and the significant increase in retail supply

in 2009 and 2010. From 2013 to 2018, Urbis projects that retail sales growth in the

Orchard Road retail precinct and limited new retail supply will lead to average rentalgrowth of around 3.0% per annum with occupancy rates rising from 91.8% in 2012 to

95.0% in 2018.

The following chart shows the historical and forecast Orchard Road retail precinct rental

growth and occupancy for the period from 2010 to 2018:

(1.1%)

4.1%

0.7%

2010 2011 2012 2013 2014 2015 2016 2017 2018

Forecast: 3% average annual growth

Orchard Road retail rental growth

94.1%

91.1%

91.8%

94.0%94.5%

95.0% 95.0% 95.0% 95.0%

2010 2011 2012 2013 2014 2015 2016 2017 2018

ForecastOrchard Road retail occupancy

Historical and forecast Orchard Road retail precinct rental growth and occupancy for the period2010 to 2018


Suburban retail

Rental growth in the suburban market is expected to average around 3.0% per annum

from 2013 to 2018 as scheduled new supply is balanced by strong demand and take-up

from retailers for retail space in upcoming suburban malls. Occupancy rates are

expected to maintain at current level of approximately 95.5% through to 2018.

The following chart shows the historical and forecast suburban retail rental growth and

occupancy for the period from 2010 to 2018:

1.1%

5.6%

1.9%

2010 2011 2012 2013 2014 2015 2016 2017 2018

Forecast: 3% average annual growth

Suburban retail rental growth

92.5%

93.3%

95.5% 95.5% 95.5% 95.5% 95.5% 95.5% 95.5%

2010 2011 2012 2013 2014 2015 2016 2017 2018

ForecastSuburban retail occupancy

Historical and forecast suburban retail rental growth and occupancy for the period 2010 to 2018


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(C) Exposure to the strong healthcare services sector

Singapore has developed into a medical hub with a reputation for high quality hospitals,

medical and dental specialists and HCS at competitive costs. Singapore is a favoured

HCS destination amongst medical tourists from Indonesia (54.0% by medical services

expenditure), Malaysia (7.0%), other Southeast Asian countries (12.0%) and others

(27.0%). The healthcare sector benefits from strong government support. For example,

SingaporeMedicine is a government initiative to work with the industry to strengthen thecountrys position as a leading medical hub.

SPH REIT offers investors exposure to the strong HCS sector, with the medical

suite/office sector contributing 24.8% of NLA as at 28 February 2013.

The drivers for continued growth of Singapores HCS market include:

population growth;

rising household incomes;

strong government support;

expanding medical services offerings;

rising affluence of the growing middle class in Asia;

overall aging population in Asia; and

a lack of quality HCS regionally.

Urbis estimates Singapores medical tourism spending to grow from S$980.0 million in

2011 to S$1.7 billion in 2018, representing a CAGR of 8.3%.

The following chart shows the historical and forecast annual medical tourist spending in

Singapore for the period from 2007 to 2018:

(S$ million, calendar year)

1,2831,165

777 856

9801,069 1,178

1,2871,391

1,4901,597 1,710

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Forecast

Historical and forecast annual medical tourist spending for the period 2007 to 2018

Source: STB1: Appendix F, Independent Retail Property Market Research Report.

1 STB has not provided its consent, for the purposes of Section 249 of the SFA (read with Section 302(1) of the SFA), tothe inclusion of the information extracted from the relevant report published by it and therefore is not liable for suchinformation under Sections 253 and 254 of the SFA (both read with Section 302(1) of the SFA). While the Manager hastaken reasonable actions to ensure that the information from the report published by STB is reproduced in its proper formand context, and that the information is extracted accurately and fairly from such report, none of the Manager, the Global

Coordinator, the Joint Bookrunners or any other party has conducted an independent review of the information containedin such report or verified the accuracy of the contents of the relevant information.

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The following chart shows the breakdown of medical tourist spending in Singapore in

2011:

Breakdown of medical tourist spending (2011)

Malaysia

7%

Indonesia

54%Other South East

Asia

12%

South Asia

7%

North Asia1%

Other

19%

Source: STB1: Appendix F, Independent Retail Property Market Research Report.

(3) Real estate exposure to Singapores premier shopping and tourist precinct, Orchard

Road

Orchard Road, Singapores premier shopping and tourist precinct, is a 2.2-kilometre (km)

one-way boulevard located in the central region of Singapore flanked by 43 retail centres

with approximately 7.3 million sq ft of NLA and over 10,600 guest rooms and serviced

apartment units in the vicinity. The precinct is well connected by underground pedestrian

walkways and linkages between malls.

Orchard Road is an epicentre for shopping, leisure activities, entertainment, events and

festive celebrations that is regularly visited by the local population and tourists. Events are

organised by the Orchard Road Business Association such as:

Fashion Steps Out @ Orchard, a six-week fashion event in March to April that

showcases the latest season collections from around the globe;

Rev-up @ Orchard, celebratory events in September during the Grand Prix Season

Singapore; and

Christmas Light-up @ Orchard, a six week-long Christmas lighting display and other

events in November to December.

The STB and Singapore Retailers Association (SRA) organise the annual Great Singapore

Sale in May to July. Many of the promotions are centered around promoting retail across the

island through retail discounts, tourist privileges, late night shopping and other events.

According to Urbis, Orchard Road has consistently been ranked as the most visited attraction

in Singapore and was recently ranked number one in The Most Beautiful Avenues of the

World in International Survey 2011/2012 report conducted by French survey company

Presence.

1 STB has not provided its consent, for the purposes of Section 249 of the SFA (read with Section 302(1) of the SFA),

to the inclusion of the information extracted from the relevant report published by it and therefore is not liable for

such information under Sections 253 and 254 of the SFA (both read with Section 302(1) of the SFA). While the

Manager has taken reasonable actions to ensure that the information from the report published by STB is

reproduced in its proper form and context, and that the information is extracted accurately and fairly from such

report, none of the Manager, the Global Coordinator, the Joint Bookrunners or any other party has conducted an

independent review of the information contained in such report or verified the accuracy of the contents of therelevant information.

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The following chart reflects data showing that Orchard Road was the most visited attraction

in Singapore in 2011:

Most visited attractions in Singapore (2011) (in millions of visitors)

45

3023

19 18

3124

10 8 6

OrchardRoad

Sentosa

Chinatown

Integrated

Resorts

LittleIndia

SingaporeRiver

MerlionPark

SingaporeFlyer

NightSafari

Singapore

Zoological

Gardens

Free-access Paid-access


According to Urbis, by international standards, prime rentals in Orchard Road are moderately

priced compared to the worlds top retail boulevards and streets. Orchard Road was ranked

16th in terms of the average prime rent for the worlds top retail boulevards and streets in

2012. The chart below illustrates the average prime rent for Singapore compared with the

other top retail boulevards and streets:

2,630 2,500

1,1291,057 952 936 854 825686

495 481 425 418 403 375 360 331 330 321 314

Causeway

Bay(HK)

5thAvenue

(NYC)

Champs-

lyses(Par)

Ginza(Tok)

PittStreet

Mall(Syd)

NewBond

Street(Lon)

Bahnhofstrasse

(Zur)

ViaMontenapoleone

(Mil)

Myeongdong

(Seo)

Kaufingerstrae

(Mun)

Kohlmarkt

(Vienna)

Iguatemi

Shopping(SaoP.)

Tverskaya

(Msw)

Wangfujing

(Bei)

Portalde

l'Angel(Bar)

Orchard

Road(Sg)

Grafton

Street(Dub)

Kalverstraat

(Ams)

Pavilion

KL(KL)

Bloor

Street(Tor)

Most expensive retail strips worldwide (2012)

(rents, in USD per sq.ft per annum)


A key strength of Orchard Road lies in the focus of its stakeholders and the Singapore

Government to maintain the appeal of the retail and tourist precinct. In 2005, the UrbanRedevelopment Authority, Singapores national land use planning and conservation

authority, promoted the development of more interesting and varied building facades through

incentives such as relaxation of building setbacks and additional GFA. In 2009, Orchard

Road underwent a S$40.0 million rejuvenation to enhance its position as a world-class

shopping street. The rejuvenation of Orchard Road has been spearheaded by an inter-

agency taskforce led by the STB, and comprises agencies such as the Urban

Redevelopment Authority, Land Transport Authority (LTA) and the National Parks Board.

Key features of the rejuvenation include:

widening of the pedestrian walkway to cater to increased shopper traffic;

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introduction of thematic zones of flowers, forests and fruits along the 2.2-km shopping

stretch and installation of coordinated street furniture, re-pavement of walkways and

creation of urban green rooms; and

installation of state-of-the-art lighting systems.

The revamp of Orchard Road has resulted in the upgrading of the area and has further

solidified its position as a world-leading shopping and tourist precinct.

(4) Diverse and quality tenant base, providing stable and resilient portfolio performance

(A) Diverse and quality tenant base

The Initial Portfolio has a large tenant base of 431 tenants as at 28 February 2013

covering a wide variety of trade sectors, providing SPH REIT with trade diversification.

SPH REITs top 10 tenants1 in terms of Gross Rental Income contributed 23.7% of

Gross Rental Income for the month of February 2013. No single trade sector accounted

for more than 25.8% of Gross Rental Income in the same period.

The Properties retail tenants include quality anchor tenants such as Marks & Spencer,

Metro, MUJI, Paragon Market Place, BHG Department Store, FairPrice Finest and

FoodFare.

In addition, the Properties have a loyal tenant base with some of the major tenants,

such as Cortina Watch, Dunhill, Ermenegildo Zegna, Guardian, Gucci, Marks &

Spencer, Metro, Paragon Market Place and Salvatore Ferragamo, having been with

Paragon for over 10 years.

52.0% of Paragons tenants, representing 63.0% of NLA at 28 February 2013, have

been tenants of Paragon for over seven years and are in their third or later lease term.

These longstanding quality tenants cater to certain repeat customers with strong brand

loyalty and the longevity of those tenants in Paragon Mall highlights the appeal and

success of the mall.

(B) Stable and resilient portfolio performance

Over the last ten years, Paragon Mall has achieved 100.0% Committed Occupancy and

has delivered positive annual rental rate growth. The average gross rental rate per sq

ft per month was S$20.5 in the financial year ended 31 August 2012, representing a

CAGR of 7.0% from FY2003 to FY2012. This resilient performance was delivered in

spite of economic shocks including the SARS epidemic in 2003 and the GFC as well asentry of new retail competition into the market including ION Orchard (2009), Orchard

Central (2010) and 313@Somerset (2010).

1 In this context, SPH REITs top 10 tenants does not take into account one of the tenants which has not consented

to the disclosure of its tenancy arrangements in this Prospectus. (See Business and Properties CertainInformation on the Properties Profile of Top 10 Tenants for further details.)

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The following chart reflects data showing the stable and resilient performance of

Paragon Mall for the period from FY2003 to FY2012:

Completion of ION Orchard (2009),Orchard Central (2010) and313@Somerset (2010)

(1,179,600 sq ft in total)Key asset enhancement initiatives to remain market relevant...

2002to 2003:Amalgamation of Paragonwith The Promenade

2008 to 2009:S$82m asset enhancement

(1)

(2)

2006to 2007:Addition of 1 floor ofmedical suite/office

2012:

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

-

100

200

FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012

Paragon Mall Committed Occupancy (100%) Paragon Mall rent index Orchard Road rent index

SARS

100

184

100

Global financial crisis

Paragon Mall rent index and Committed Occup

Documents

SPH REIT Prospectus (17 July 2013)