Hongkong Land Holdings (H78) Status update summary

Strategic Ambition and Vision

• Aims to be the leader in Asia's gateway cities, focusing on ultra-premium integrated commercial properties, leveraging a 135-year heritage and strong brand reputation.

• Targets top quartile shareholder returns, strategic clarity, and transparent capital management.

• Will concentrate investments in Hong Kong, Shanghai, and Singapore, while exploring new opportunities in other regional gateway cities, following tenants and luxury brands into new markets.

• Conducted extensive strategic review, including interviews with tenants, investors, sector experts, and employees, and benchmarking against macro-trends and peers.

Portfolio and Market Approach

• Will stop investing in standalone build-to-sell residential projects, but may develop branded residences as part of integrated complexes.

• Focus remains on organic growth and development, with REITs and funds used to recycle capital and expand AUM, rather than acquiring other managers.

• China remains a core market for ultra-premium assets, with ongoing commitment to key projects in Shanghai, Beijing, Suzhou, and Chongqing.

• Develop integrated ecosystems with ultra-premium office, luxury retail, hotels, and branded residences.

• Proven track record in Central (HK), Marina Bay (SG), and West Bund (SH).

Capital Recycling and Funding

• Plans to recycle up to $10 billion of balance sheet capital over 10 years, primarily from winding down build-to-sell inventory, divesting medium-term lease assets, and recycling mature investment properties.

• Targets $6 billion from residential and medium-term lease asset sales, and $4 billion from recycling investment properties, with a front-end loaded approach for residential assets.

• Will bring in third-party capital, aiming for third-party ownership to rise from 20% to nearly 60% of AUM by 2035, and will charge management fees for development and asset management.

• Portfolio recycling through exit of non-core businesses and vending mature assets into managed REITs.

• Up to 20% of recycled capital may be used for share buybacks, subject to market conditions.