Good evening, ladies and gentlemen. My name is Terence from Investor Relations. Welcome to 622 Lorong 1 Toa Payoh, a property that we just recently acquired earlier this year. Thank you for attending CapitaLand Ascendas REIT's financial results briefing for the period ending 30th June 2023. We have management representatives from the client management today. They are Mr. William Tay, CEO; Ms. Koo Lee Sze, CFO; Ms. Yeow Kit Peng, Head, Capital Markets & Investor Relations; and Mr. James Goh, Head, Portfolio Management. Today's briefing will consist of a presentation followed by a Q&A session. Please note that today's session will be recorded and will be available via webcast. Before we start, let me brief you, those present, on the fire evacuation plans. These are the fire evacuation routes for you to take to the assembly area. The next slide shows you the assembly area besides this building. We will now proceed with the presentation of our financial results for the first half period ended 30th June 2023. It will be presented by Ms. Yeow Kit Peng, Head, Capital Markets & Investor Relations. Kit Peng, please. Terence. Good evening, everybody, and welcome to CapitaLand Ascendas REIT first half 2023 results briefing. Key highlights. Financial performance. The distribution income for the first half of 2023, is 1% lower at SGD 327.5 million. Distribution per unit is SGD 0.07719, 2% lower year-on-year. Investment properties SGD 17 billion, 2.5% higher than 30th June 2022. On the asset management side, portfolio occupancy was stable at 94.4%, and a positive rental reversion of 14.2% was achieved. For capital management, leverage was 36.7%, and we continue to maintain a high level of natural hedge at 75%. This is first half 2023 versus first half 2022. Gross revenue is up 7.7% to SGD 718.1 million, and this is mainly driven by the three acquisitions in Singapore in the first half of the year. The three properties are this Toa Payoh property, 1 Buroh Lane, as well as The Shugart that were acquired in the first half. Net Property Income increased 6.7% to SGD 508.8 million, and is correspondent to the gross revenue. However, offset by slightly higher operating expenses. The total amount for distribution declined 1%, and this is mainly due to the increase in borrowings costs on rising interest rates, as well as a higher loan quantum as we buy more properties. DPU fell by 2% to SGD 0.07719, and this takes into account the lower distribution and as well as the enlarged unit base following the issuance of new units during the private placement in May. This is first half 2023 versus second half 2022. Same reasons here. Gross revenue is up 4.7%, and that is driven by the contribution of the three Singapore properties. For NPI, similarly, also driven by the new acquisitions as well as partially offset by an increase in the OpEx. Distribution fell by 1.7% mainly due to higher borrowing costs. DPU fell in tandem due to the enlarged number of units following the private placement in May. Distribution for the period of 25th May to 30th of June, we will be distributing SGD 0.01578, and you will be getting the distribution on 1st September. Investment management. These are the three properties that were acquired in the first half. They are all in Singapore. The total acquisition cost amounted to almost SGD 515 million. These are very well located and good quality properties, they are accretive. During the same period, we also divested a property, KA Place, for SGD 35.4 million at a very high premium of 55% to the valuation. This is overall in line with our strategy to deploy capital towards value-adding opportunities, thereby improving the quality of our portfolio. You have seen this. Capital management. As we continue to acquire properties, the total debt increased to about SGD 6.6 billion as at 30th June 2023. However, gearing is healthy at 36.7% following the successful equity raising in May. We raised SGD 500 million. Our emphasis is to ensure a healthy gearing level during this uncertain business environment. Our debt is well spread out. In any one year, we have 15% or less of our total borrowings that will come due for renewal in the next five years. The interest cost as at June is 3.3%. This is the same level as March 2023 during our 1st quarterly business update. Compared to December 2022, it was at 2.5%. The high level of fixed rate debt that we have, 82%, that help us to maintain and have that gradual increase in the interest cost. The rest of the financial metrics are at very healthy levels, far exceeding the required minimum levels by bank covenants. We continue to enjoy the Moody's A3 credit rating, which is very important. It provides us with a lot of flexibility, and also definitely stronger access to capital. We have two sensitivity table here. On the left is on the percent of fixed, 82%. For the balance, 18% that is on variable rate. Based on 100 basis point increase in interest rates on the variable rate debt, then the impact on DPU would be a minus 1.8% for distribution. On the right, it is on our refinancing for the 2nd half of this year. We have about SGD 668 million that is coming up for refi. Assuming 100 basis point increase in interest rates, then the impact would be a minus 1% on the distribution pro forma basis. Natural hedge. To minimize any impact from adverse exchange rate fluctuations, we have a high level of natural hedge of 75% for our overseas investment, which accounts for about 40% of our investments. Portfolio occupancy. Very stable at 94.4%. If you were to look at all the countries that we are operating in, they are all above 90%. We have some details here. For Singapore, stable at 92.3%, right. U.S. declined slightly to 92.1%, and this is mainly due to movements in Raleigh Business Parks. Australia improved by 20 basis points to a high of 99.5%, and this is due to the high occupancy at Cargo Business Park, which is a logistics property in Brisbane. Okay. U.K., Europe, happy to report that all our 38 logistics property and our 11 data centers are very full, right. 99.5%. In terms of new take-up in Singapore, we saw demand from tenants in the logistics, IT and engineering, financial services industry. Most of the leases that were signed are for three to five years, right. Although we had a lease that was as long as eight, nine years by a bank. Okay. Overseas new take-up, we saw demand from companies in the IT, data center, logistics industries. There was a lease in the data center space for as long as 15 years. All these long leases will certainly provide CLAR with a long-term stable income stream. Okay, rental reversion. In 2Q, we achieved an average rental reversion of 18%. If you were to zoom in onto Singapore, it is a 19.5%. For U.S., it's 11%, Australia 12.9%. With our half year, half time, 14.2% increase in the rents, we will be guiding for a positive high single-digit range for this year. Okay, the WALE is 3.9 years. For the rest of this financial year, we have 6.9% of our gross rental revenue that will be up for renewal. Okay. Then, I will come to this ongoing project. We are working on almost SGD 800 million worth of projects that's undergoing development, redevelopment, asset enhancements, and convert to suite. This quarter, we have a new addition. This is 5 Toh Guan Road East. Okay, which is a logistics property. We are going to be spending SGD 107.4 million to redevelop 5 Toh Guan Road East. It is very strategically located in the prime Toh Guan logistics park, with double frontage of the PIE and Toh Guan Road. We will be maximizing the plot ratio, and the GFA will increase by 71% to 57,920 sq m. Quite a sizable logistics property. The new property will be six stories high with ramp-up facility. Some key features include 82 dedicated loading bays, power provision for cold storage usage, very large contiguous floor plate with ceiling height of up to 12 m. We will also be adopting sustainable construction, green concrete, and sustainable products that will be used, and it will be targeted to obtain the Green Mark GoldPLUS or higher certification. The completion will be in 2025. Okay. Finally, to conclude, our well-diversified and resilient portfolio is generating a steady stream of income, as you can see. We will continue to acquire quality properties with good returns potential. Given our very healthy gearing of 36.7% and our strong Moody's A3 credit rating, we are confident to ride out this economic uncertainty. Right. With that, I end my presentation. Thank you. Thank you, Kit Peng. We will now proceed to the Q&A session. For those present, please raise your hand and my colleague will pass you a microphone. For participants via Zoom webinar, please type in the question in the Q&A function box. Please state your name and organization before your question. I believe, Mervin, you have the first question. Merv. Hi. Mervin from J.P. Morgan. Congrats on the very strong rental reversions and the upward guidance for the full year. Maybe you can start on Singapore. Can you please touch on what's driving the healthy reversions? Is it very strong demand from relocations, expansion? Can you touch on logistics and business parks, which I think has been a worry for some investors? Second question is regards to electricity. CDL Hospitality Trust was talking about quite a material drop in electricity costs heading into next year. Maybe you can touch on what rates you can lock in for, let's say, second half this year and next year. Finally, third question. My investor concern has been U.S. office, but maybe you can address those investor concerns, given that you'll be able to maintain occupancy thus far. Thanks. James and Jason. Oh, James. Let me just start. Thanks, Mervin. The Singapore reversions, as you can see, is mainly driven out of logistics. 39%, this is really quite a strong number that we have delivered. The supply-demand imbalance is still there. There's hardly any supply right now. You can see that even ourself, we have actually decided to tear down one warehouse and to rebuild into a new ramp-up facility. The reason why we didn't disclose that earlier is because we are talking to our tenants to move them to our own facility. We have already landed the anchor tenant onto our own facility. It shows that logistics is a movement from just in time to just in case, and I don't think it is stopping right now. I think it's probably still a need, and many companies are still planning in terms of just in case. That's actually driving the demand. Also coupled with that, the supply is not turned on that fast. Overall, in the industrial, in logistics, and even BP market here in Singapore. This year, another 500,000 square meters of space is to be available, another 1.9 million next year. If you look at the pre-commitment, they're all very high, between 60%-70%. Business park, if you look at the supply and demand for the next three years, actually, together with the sponsor, we are probably the one that is driving a lot more supply in Science Park, including our AEI transformation IBP. If you see the chart, Occupancy at 0%, pre-commitment is mainly from our own properties. There are still two to three years way to go, so we are fairly confident that we should be able to pick up from there. I also mentioned previously that the business park space actually has surprised us a little. I guess all of us were concerned over the movement of work from home, banks moving out. We are not surprised that they're still downsizing, which is a norm right now. Successfully, first Q, we have brought in one new financial institution into CBP, and second Q, we also brought in another new financial institution into CBP. We see this as BAU, given the fact that there will be relocation, there will be downsizing, but as well as expansion and new take up in our space. Industrial has been doing very well, which is also driving the rent growth. I would let James touch on maybe anything to add, if not, electricity and U.S. Sure. Okay. Thanks, Merv, for the questions. First off on the elect, we see similar trends as well. Our second half rates that we have contracted is about 9% lower than what we contracted for the first half. For next year, our formula has been locked in, but we have not locked in the contract. The base components of that formula would include cost of your crude oil, FX, et cetera. That tends to move. Based on where prices are today, we would see a further decline in next year's elect cost as well. Again, that's just to provide some guidance. Moving on to U.S. office, I appreciate the concern about the U.S., given all of the negative headlines that you have seen with COVID accelerating the work from home kind of phenomenon. I'd just like to put things in perspective. If you look at the U.S. as a proportion of the entire portfolio, they make up about 14%, of which 2% of that This is in AUM terms, but it roughly translates to NPI as well. About 2% goes to logistics. We're down to about 12%. Out of this 12%, if we carve it out further, about 5% belongs to the SoMa properties. Those SoMa properties, they are very good grade A properties with a fairly long WALE. One is leased for the next 10 years, another for another four years. For the building that currently has four years to run, that tenant has sublet it to one of the largest IT companies, and they invested a substantial amount to retrofit the building to their requirements. We are, again, very confident that that building will continue to be leased even after the fourth year. If I take out SoMa, which is another 5%, we are down to about 7%. This 7% would really be the three initial portfolio that we acquired when we went into U.S. That would be Raleigh, Portland, and San Diego. If I were to break down the dynamics for these three cities, San Diego stands out. It's mid-'90s kind of occupancy currently. It's really anchored by your tech, your defense tech, life sciences. San Diego is one of the top three overall markets in the U.S. for life science companies. There's a lot going on, a lot of good that's coming out of San Diego. We are fairly confident with San Diego. Next, we move on to Portland. Portland, I think many of you would have been aware that it's been a bit bumpy, and that the occupancy has come down since our original acquisition. That's sort of like a reflection of where Portland is. It's never been a tier 1 kind of city. It has its own charms, and we continue to see deal flows in terms of leasing. They tend to come from smaller kind of tenants. If you just observe for the last two to three quarters, we have more or less maintained occupancy there. It's come off, but I am still fairly okay with Portland. Next, I move on to Raleigh. Raleigh, this year, there was a big chunk of our leases coming up for expiry. Quite a few of them are IT kind of companies, and many of them have downsized, which again is no surprise. I think for Raleigh, the worst is probably behind us. We are through most of the lease expiries for Raleigh. I think overall, the message that I'd like to just pass on is while U.S. definitely isn't positive, as you can see from the headlines. On an overall impact to the portfolio, that's not too bad, as in we are not overly concentrated, and that's where the beauty and the advantages of having a very diversified portfolio With SGD 17 billion worth of AUM, 230 properties across four continents helps. At any point in time, there will be some markets that will be doing better than others. Case in point, being logistics in Singapore, three years ago, rents were coming off quite badly, and today it's the darling of the markets, right? While I'm not saying that's going to happen to U.S. in three years time, I'm just sharing based on past experience. At least we have gone through cycles like that. The other thing that we have going on for us in U.S. is currently our rents are still below market, which is why you see that in terms of rental reversion, even for business park space in U.S., we are still chalking up fairly healthy kind of reversion. That helps to slightly mitigate some of the losses that we get due to the lower occupancy. I hope I've answered your question. In summary, the U.S. office is probably Raleigh. That's the one that probably we need to do some work. First quarter, the occupancy came down because of Raleigh. Second quarter as well for Raleigh. Portland, there is downsizing, but we managed to find new tenants, which is why if you look at our Portland, even for second quarter, the occupancy actually climb up slightly. All in all, I think that is a market that we find that the flight from CBD locations to our suburban location in Portland is still an appealing factor for people to move. Raleigh being a more of a research, it requires, if you like, out-of-state investment into Raleigh, which probably we need some time to work on those vacancies. Hello. Hello. Can you hear me? Yes. Just one question on the acquisition front. Can you update us on the EU acquisition that you were supposed to be doing duty? Is that still in the process or is there a delay? What's the reason for the delay? That's the first question. On the acquisition price that your prospective vendors are looking at, have you seen any interesting expansion in cap rates that we could see more deal flows coming through over the next 6 to 12 months? Those are my two questions. Thanks. We are still on track. No delay. Just to update, the duty has been completed. We are just finalizing the documents and the rest of the details. We should be making an announcement soon. In relation to cap rates, actually in terms of various asset classes, other than U.S., which we see some movement in cap rates, Australia, Europe, the cap rates has been quite stable. Even for our own assets, you probably have some time to look at the valuation later. Our valuation has been fairly stable. A small movement, 1%, 2%, each of the country. Singapore, actually, the valuation went up. U.K. also went up by about 3%. I don't see any big expansion movement, in Europe. We probably will expect more transactions in second half across the countries that we operate in. That may give an indication to valuers exactly where should the cap rates be in the next 6 months. We will watch out for that in our December valuation. What we hope to see is that now when the interest rate is more or less at, I would say for some of these countries that we operate in, it's probably quite peakish peak already. We do see more interest to transact, which is why I think the market is expecting more transaction in the second half. Right. Thanks. Leo. Thanks, William, and thanks for the presentation. Just two questions from me. I think firstly with regards to the redevelopment of Toh Guan. Are you able to share what is the expected ROI? You mentioned about moving of the anchor tenant. Are you saying that you have an anchor tenant there already or anchor tenant from the building you relocated there to- Move to another location. Okay. My second question is on the debt. You have that SGD 600 plus expiring this year. I believe you are probably in quite advanced stages of negotiations already. Just wanted to know what should we be expecting in terms of cost of debt by the year end? Thank you. You want to take the second question? For the first question, that's the anchor tenants existing there. We have moved them to another location of our property, of our portfolio. What is driving that redevelopment is actually a transformation from a cargo lift development to a ramp-up facility. Typically, a cargo lift warehouse at rental right now, probably about SGD 120, SGD 110, SGD 120. A ramp-up facility is actually much more. Easily 25%, 30% higher than a cargo lift. We only have a few, in fact, only two in the west. The rest of the cargo lift warehouse are all in the east. This is in a very good location. That's untapped plot ratio. It's not just the rent that is driving the interest for us to redevelop, but the 71% increase in GFA is quite huge for us. You will see half a million sq ft building coming up, and in that location is quite huge. In terms of yield side, you're asking about NPI yield, we probably looked at 6%-7%, depending where we can lend in terms of the interest. Possibly higher if we can lend cold storage, which we manage to get higher electricity, to be able to fit a cold store if we need to. Just to close up, we don't have any tenants right now, but there is interest out there. We know there's some RFP that we are working on, and we are able to improve yield if we can land even cold storage. On that SGD 668 million of borrowings coming due, some of it is maybe August, September, and then some of them are in December. The average cost for these borrowings currently is about 2% odd. When they come due for refinancing, assuming the same tenant, all things being equal, then the cost could go up to around the 5%-ish. Put it in perspective, SGD 668 million is 10% of our total borrowings. For the full year, I think at half time, the average cost is 3.3%. For the full year, we think it's going to be around this level. Could be 3.3%-3.5%, thereabout, based on current benchmark rates. Thank you, Gail, for your question. David? Have you done a study for your end tenants that move from just in time to just in case? How much more space would they need? Do you have any idea? I don't think we have that idea. Yeah. Conversations around has been more on meeting of their own tenants or their clients' requirements. I would say even for COVID, when during COVID, we do see some of this stocking up of inventory. It has reduced in terms of number of providers to provide all this inventory, but the amount of space that were taken up for all this additional stocking up and just in case has been the same. For example, the number of customers who were given the mandate to help the government stock up, at that point in time was about four to five logistic players who were supposed to help before this national mandate. The four or five has reduced to one, but the size of inventory still required is still the same. I don't think we could clearly see whether is it a just in time or just in case, but you do see that a lot more expansion requirements out there. Even like now, Gail was asking about whether as a tenant, I mentioned there is RFP out there. We are responding to some of this RFP, and half a million sq ft is in the location of Toa Payoh is very attractive. I can't give you an exact number. Okay. Another question is, can you discuss why the NAV dipped half-on-half? It seems like your placement was way above goal. I think the adjusted NAV is actually quite similar. SGD 2.321. 2321. I guess my final question is, going back to the refi. Kit Peng mentioned that you're going to refi from like two odd percent to up to five-ish percent. When we look at your sensitivity table, do we use the 300 basis points as the best indicator for sensitivity? No, that's all things being equal, right? There'll be other moving parts. Yeah. I think I should also add, some of these headline numbers. Sometimes we have to consider what currencies they are in also. Singapore debt will be cheaper, maybe around 4% for five-year. Okay. Then maybe for the sterling pounds would be around the five plus. Okay. It depends on what currencies we're talking about. Okay. And the tenant. Yeah. Hi, this is SanShea. I'm here. First question is on acquisition. I think earlier you mentioned you expect second half to see more deal flow. Does that apply to CLAR as well? We've been quite active. I believe we still have enough pipeline to work on, whether we can actually successfully land them or not I can't give a clear indication. To hit 40%, we have 1 billion of headroom, which is quite good for us to be able to use when opportunities do arise. Sure. Okay. Second question is on reversion, right? Understanding it's on average, but can you give more colors? Are there leases that are excluded if it's renewed for a separate tenant? Separate tenant. does it include all leases that's renewed? All leases renewed for multi-tenanted building. Okay. Yeah. Okay. Got it. Thank you. Yeah. If it's a new tenant, it's separate, it's considered a new take-up. Also, a multi-tenanted building, to a new tenant is excluded. Yes. If you include that, does the number change materially? In terms of the market rental right now? That reversion number. Reversion number. It won't be that high. Yeah. It won't be that high. Yeah. Okay. Yeah. Thank you. If it's a new tenant who comes in, they will likely, given the supply-demand right now in Singapore, they're probably quite similar to where we renew. A new tenant that comes in is probably the same as where we renew. Our existing tenant, we compare to the previous lease average, right? It's three years, so it's the last three years' average. A new tenant comes in, you're just looking at a market rate. In terms of contractual, they're likely to be the same as our renewed tenants. You catch that? Yeah. There was one period our renewal was stronger than market rent, but now they are more or less the same. Anything to add, James? Yes. Joy? Joy from HSBC here. Hi, Joy. Two questions. First of all, on acquisition, would you be exploring other new markets to tap into yield spreads? I think we are fairly busy in the markets that we are in right now. We talk about, for example, other mature markets, which is what we've been more keen on, includes, say, Japan, Korea, and all this. We find that it's a very different market from where we are right now. While we may get better yield spread, but we want to make sure that we are able to execute them, enter at a sizable AUM or acquisition, and then subsequently be able to scale up. That's what we hope to achieve. Some of these markets may not be able to allow us to scale up that fast. If you look at our track record from Australia to U.K. to U.S., once we enter, we are able to scale up each of the market. Now it's between SGD 1.5 billion-SGD 2.5 billion, which is quite substantial for us to manage, and we hope to be able to deepen ourselves there. Second question is to follow up on Singapore, your redevelopment. Will the land lease be able to extend it on the back of redevelopment plan? Not at this point in time. It's not part of consideration right now. Just to confirm, 6%-7% is yield on cost, right? Yes. Cool. If I may just follow up, just amongst your market, do you think it is still more higher return to redevelop or would it be more attractive to actually acquire? I would say the redevelopment allows us, if there's an opportunity for us to unlock plot ratio or change the usage to be able to tap on the higher renter, I think that's probably be more attractive. Given that construction cost is still high, but it has more or less stabilized. As well as in the markets that we are in, we have started looking at much more AEIs, probably what James can explain also. In the U.S., because of changes in occupancy, it gives us more comfort to invest into AEI. That also attracts tenants to come back. Tenants and their employees to come back to work. It helps them when there's more amenities. We are doing more white boxing as in preparing the space to be leased out, so that it becomes cheaper for them, easier for them to decide. Once that is done, I think it's probably easy for us to get it leased out. That's the primary reason because construction cost availability contractor has more or less stabilized right now. Thanks, Joan. Any further questions from the floor? In the meantime, I think there were some questions that are posted online, but I believe most of the questions have been addressed. Does anybody else have any other questions? Willa? Hi. Yeah. Thanks for the presentation, William and Kit Peng. Just wondering, okay, there's a large expiry coming up in the U.S. in 2024. Just wondering what it is and whether you started negotiating, because was this from the first acquisition that you made in those three regions? Also in Australia, you've got a couple of expiries. Are your passing rents or your in-place rent a lot higher than the market rent? Because that tends to happen in Australia after a while. I'm just wondering whether those things would impact those expiries. Said this before. They're only on 20-year leases, so what's your plan to do when Basel III kicks in? I'm just wondering because will they start to be written, will the valuations start to fall? Did the valuations that MUST make in the middle of the year this year, did that have any impact on your own valuations? Do you think that you should-- Also in Australia there was a transaction on the property, the Dexus one. Yeah. Does that have any impact on your Australian valuation? I know it's more or less a different asset class. The last question is, were you thinking when you said that you had two tables, one on the left side and one on the right side. Would both of them kick in this year when you Because you've got some floating rates, right? Like you said, they all impact, and then your SGD 600 million is going to be renewed at that high level. 100 basis points, there'll be an impact on 2%-3% of DPUs. Is that it? I'll take that one easy one. Easy one. Left or right table. Well, okay. It's not meant to guide on DPU, it's really standalone. All things being equal, then- It's pro forma basis. It's pro forma FY 2022. What possible impact it might have. I think the point is that we want to highlight that because of the high level of fixed, that will really help to minimize the volatility of our DPU. Although, when this SGD 600 million, SGD 700 million loan borrowings come due, there are many ways how we can save money, right? We're not limited to the same structure for the existing ones. We can always look at alternative options like, take on a different currency and then you swap it to another currency that result in a cheaper, more competitive rate. Right. This is just a very ballpark guidance. Like for like, the same loan, if it was a five-year loan, then we apply a five-year loan looking forward what the cost might be. Okay. Your left and right table, I think if you looked at the unfixed portion, it's been moving up, right? In terms of impact, it's not that huge for us given that we have been able to fix now at 82%. The right table seems like a giveaway what to look out for, but it's a pro forma basis and there's no surprise. Just what SanShea asked about the question about average. These were loans that were signed five years ago. They definitely were much lower and then we have to refi. You will know the numbers, what kind of rates that we will be looking at, and then you will know what's the jump in terms of the change in interest rates. Moving up to your valuation question. If you look our valuation, our U.S. is -2.8%. What we did is an in-house revaluation exercise where we look at operational performance margin, occupancy, the rental rates that we achieve. Without touching other variables that the value was done. Example, capitalization rate, discount rate, this was done by third party. This is a in-house valuation just to adjust the performance for the six months. Right. With that, U.S. came up to be about 2.8%. We find that as we also have a conversation with our valuers, the indication to us if we were to do a valuation exercise today, valuers will guide probably in the market is about 25, 30 basis points expansion for the assets, the locations that we are in. Dexus came out, okay, that's for Australia. Manulife came out much higher, I think in terms of numbers, about 75 basis points, which I think they themselves also say that there's a surprise with the valuation. We are quite different in terms of the locations that we are in. Occupancy has been fairly stable while there's movement, but yet rental rates has been strong for U.S. For Australia, the movement is about 1.2% down, which also adjusting for occupancy, margin, the rest of the occupancy numbers. When we talk to our valuers for in Australia properties, they also guided, if there's any movement in capitalization rate, it's probably about 25 to 30 basis points. Dexus has moved between 31 to 32 basis points. I think that's quite in line. No surprise there. Australia is also as well as that we have a very strong logistics as offsetting the numbers that came down from office. Okay. I think we are fairly aligned, in terms of where we see the numbers are. Even without adjustments of a revaluation exercise by third party. Maybe I'll touch on your 20-year lease. We're in a building that we bought in 2021. We looked at various factors. What it was used before this, it was also a Philips factory. This is brand new. They rebuilt this. If you look forward, I think the land use has still been in industrial. The likelihood, obviously, may convert to residential, but as is, when we looked at how the industrial landscape has been executed here in Singapore, there will always requirement for employment in a residential estate. They will not take out every single industrial site in the residential estate to convert to residential and simply put all employment facilities out into the west or the east. Every residential estate there will be employment requirements. I think I was talking to David just now. If you look at where there's a hint of any change in the land use, it's when you are a change in industrial or a site to reserve our site, right? Chances are you know there will be a change in time to come in the concept plan, where five, 10, 15 years. This has still been an industrial site and has been here for the past 30 years, 40 years. We believe there's a good chance that we will be able to talk to JTC when the lease do expire, to extend this space. Bearing in mind that while there is a opportunity to extend, JTC today for all any new leases is 30 years. It will be a norm. I think it's probably at a stage where we are able to buy in the past, 30 plus years because the lease was 30 plus 30. As new leases now is allocated at 30 years, you will then be able to buy maximum 27 years. Why? Sorry, 23 years. Why? Because there's five years moratorium and two years construction. Seven years is taken out of the lease, so maximum is 23 years. That will be a norm. I think we got to get familiar with that. We definitely want to be able to continue, hopefully owning this site beyond that 20 years. If there is an opportunity for us where there's a risk that shows up that we can't renew or they can't extend, obviously we'll look at divestment. In Singapore, short leases also has a life of its own. 10 years, plus minus, there is still a buyer pool. Small medium enterprises who are not able to find themselves qualified for a direct land allocation, they will look at secondary market, and it probably will be a cheaper source to buy a short lease so that they can continue operation for 7, 10 years. Even at 10 years, actually is a few cycle of tenancy. Every 3 years, so at least it will be 3 years of tenancy. There will be good use for even a short lease. AU rental reversion expiry. Okay, thanks, William. I think the first question is the U.S. expiries in 2024. Next year, there will be another chunk of Raleigh leases coming up for expiry next year. Typically, we engage our tenants about 6 months in advance. Substantially, we haven't really started the negotiation process for leases expiring in 2024. We have much clearer visibility in terms of what's going to happen in the second half. Besides Raleigh, there's also quite a few leases coming up from the other legacy cities, which is San Diego and Portland. If I move on to the second question, which is on Australian expiries and where would they stand versus market, and what kind of reversions we're going to get. It's true. In the past, say, 5 years back. Typically, in an Australian lease contract, there will be in place annual increments anywhere between 3%-4% on average. If you talk about 5-year lease, after that period of compounding increases, it will typically be higher than market. What has happened over the last 3 years, particularly accelerated by COVID, is that with the very tight supply and vacancies almost at 0% in most of the major metro cities that we are in, which is Sydney, Melbourne, and Brisbane, we've seen record high renters being signed, and that is prevalent in our portfolio as well. While the in-place rents are no doubt high, but market rents have actually caught up. The other thing to note is the way we calculate our reversions is typically an average. We don't take the ending rents versus the starting rent. The ending rents from the previous lease and the starting rent. If you look at average to average, there would still be positive rental reversion for Australia. Mervin, you have another question? I just want to follow up on my electricity question. I appreciate that you haven't locked it in, but what can you lock in if you decide to lock in for 2024 in terms of cents per kilowatt hour? I can't give you more precise. Until we lock it in, that number will move every day depending on the FX and the crude price. Will it be below SGD 0.30 at least? We can't guide you on that. Historical, given historical, 2021, we probably was less than SGD 0.20. 2022 SGD 0.29. Yeah, less than SGD 0.30. Now, it's above SGD 0.30 right now. We are looking at lowering these numbers. From 2022 to 2021, it was about 60% jump based on our utility. I think you know the numbers. 2023, I mentioned, we probably look at between 30%-50%. First half is probably a 40+% increase. Second half, as what James mentioned, is lower than first half. We expect full year, maybe 30%-40%, compared to 2022. 2024, we do expect the numbers to come down further, but we have not locked in. We hope to be able to catch that window, which we have done so for our second half as well as our first half. Just a follow-up question on the U.S. portfolio. Can you talk about TIs? Are they starting to stabilize or still increasing? In terms of the new leases signed, are you still getting the inbuilt escalations of that 3-ish%, or has it flatlined? Yeah, what's happening in terms of escalations? Thanks. Okay, I'll take that question. I think generally, TIs have remained stable even though increasingly tenants are asking for more. It comes down to the process of negotiation, how attractive your assets are, how much supply is there out in the market. To cut the answer short is, it's stable but it's increasing. Sorry, you had a second question on All right. Okay. The annual escalations, they're more or less there still. We are typically looking at about 3%. To keep our assets competitive, even in Portland, which is, like I mentioned, not a tier 1 city, we are trying to get the best bang for our buck. We do very selective AEIs. One example is in Portland, there's this building we call Atrium, which is multi-tenanted. We are putting in a new amenity center inside there. You're going to get gym, there's going to be a cafe, there's breakout rooms, meeting rooms, and all that. That's going to serve as an anchor for all of the buildings which is around that park. We're going to spend about $1.5 million on that alone in US dollars. In Raleigh, Perimeter Park, where our properties are, we're going to spend about $900,000 to build an outdoor terrace amenity for our tenants again. There'll be landscaping, there'll be barbecue, and we'll be bringing food trucks during the day to encourage people to come and make use of that outdoor amenity space. Separately, we are looking at spending up to about $2 million on white boxing. What white boxing means is, in the U.S., typically in the lease, there's no reinstatement requirement for the tenant. When they leave, it's on an as-is condition. They don't have to tear down the walls. They don't have to remove their fit outs. In the past, what would typically happen is, we'll try to lease it as is. Maybe just shampoo the carpets, maybe bring in some new partitions, but typically keep it the same configuration. In the past, tenants are quite happy to take those. As the market has changed and tenants are a bit more demanding in terms of wanting more brand-new specs, that's where we are putting in this kind of CapEx to white box the space, tear it down, put in new carpets, new lights and all that, refresh the whole place so that when people come in, it would be a lot more enticing for them. Those are the kind of things that we have been doing on the side as well, to try and improve and make ourselves more competitive. Okay. We have a question from Derek from DBS. Will you be keeping your current interest rate hedging strategy given that interest rates have likely peaked? Yeah. Yes, we will have to be very nimble on this, right? Now we are at 82%. Given that high level, we do have the flexibility to have it at a lower level. Okay. We will have to watch closely and be flexible. Yeah. Mm-hmm. While it's peaking, We also see that the longer-term rates are more favorable than short- Are cheaper than the short floating ones. Yeah. We also, getting a cheaper loan, cheaper rates right now despite being a five years or six year up, also allow us to catch up in terms of revenue, rental growth, reposition of assets, so that we can actually be able to sustain a higher rates for long kind of scenario. Okay. We have also a question from Derek from Morgan Stanley regarding Pinterest in their SEC filing. They actually mentioned about a pre-termination of this lease. Have we been in dialogue with them? Can take that question. Yeah. Yes. This is actually not a new development. This filing has been out for many months now. In the initial period when this notice first came out, we got in touch with Pinterest as well to find out exactly what's happening. It's very clear that they intend to honor all of the obligations that they have, which is why I'm very confident when I say that there's a 10-year lease left on that building. I'm going to collect every single cent of that 10-year lease. There were preliminary talks between our side and Pinterest, but that didn't really go very far in terms of even coming to some numbers in terms of if they were to pre-terminate, what kind of compensation would they be offering. We didn't even get to that stage. As of right now, they continue to honor their obligations, and they continue to pay their rents on time. Our understanding is this is more of an accounting kind of treatment that they have, because they need to put that out in order to do some write-offs on their accounts. Legally, they are still bound, and they continue to pay their rents. We don't think that that's a problem for us. There's no pre-termination rights. They mentioned in their filing they will honor that lease, including potentially looking at subleasing or mention about pre-termination is to raise as a request to us. We didn't have anything further to add on that. Any other- Any last question from the floor? Acquisition, divestment. Oh, look. Okay. I think acquisition I've answered. Okay. Yeah. Divestment will probably still opportunistic for us. As you have seen, we have divested one property here in Singapore. I think when there's opportunity to look at a divestment, we will look at that. At least in Singapore, we find that the question about redevelopment acquisition, I think in Singapore, there's still more opportunity for us to redevelop. We believe the location that we are sitting on are very good location. If we can find the right usage to be able to get a higher renter, that would help us to reposition our assets. Thank you. Any further questions? If not, I think that concludes today's briefing for our first half, 30th June numbers. Thank you for coming, and have a good evening. Thank you. Thank you.