City Developments Limited (C09) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, friends from the media, analysts, bankers, investors and CDL colleagues. My name is Belinda, and I'm the Head of Investor Relations and Corporate Communications at CDL. On behalf of the management, a very warm welcome to CDL's briefing on its unaudited first half 2024 financial results. Thank you for joining us this morning. We have quite a big group this morning right here at the M Hotel Singapore as well as we have a large group that is joining us on web, live webcast this morning. Now for today's briefing, in line with CDL's commitment to environmental sustainability, we encourage you to scan the QR code that will be screened up here and to download the following documents that were already uploaded on the SGX website this morning. They include a copy of the detailed financial statement, a press release summarizing the key highlights of our performance, a presentation deck that the group will be going through very shortly. And for our guests that are joining us live on webcast, you would similarly be able to download these documents on our website on the tab in front of you. I would like to introduce you to the CDL management panel. In the center, we have Mr. Kwek Leng Beng, our Executive Chairman, followed by our ExCo members, Mr. Sherman Kwek, our Group CEO; Mr. Kwek Eik Sheng, our Group Chief Operating Officer; Mr. Chia Ngiang Hong, our Group General Manager; and Ms. Yiong Yim Ming, our Group Financial Officer -- Chief Financial Officer. The format of today's briefing will be in 2 parts. We will kick off with a presentation of some of the key highlights and then followed by a Q&A opportunity. Now without further ado, I would like to invite Mr. Sherman Kwek, CDL Group CEO, to kick start the presentations. Mr. Kwek.

Anyway, thank you. Today, all of you quite formal, give me some applause as I come up to the stage as well even though, as I'll take you through, we have faced quite a lot of sector headwinds. So I know we didn't exactly release the previous set of results, but we have a lot of stuff in the works, and we intend, I think, to further accelerate things as we move forward. So as you can see, in the first half of 2024, I mean, our revenue is down primarily because the same period last -- corresponding period last year, we had this Piermont Grand, our EC project in Punggol, that TOP-ed in January last year. And as you all know, I mean, when EC project is TOP, that's when you recognize the full revenue and profit and that made it quite hard for us to compare because there was $1 billion of revenue that came in just from Piermont Grand last year. But the truth of the matter is that on the -- our profitability has been quite severely impacted, I think, by the higher financing cost. So as long as this interest rate environment remains high, it certainly put a lot of pressure on our business, right? I mean as you all would have noticed over the last couple of years, we've been investing quite heavily in recurring income assets on the multi-family side, on the student accommodation side. And many of them are doing very well. But in this high interest rate environment, it's actually quite difficult, I think, to even cover the financing cost. But having said that, I mean, I think we are generally of the view that hopefully next month, we will see the signs of -- the first signs of easing as interest rates hopefully start to taper down, and that should lift a lot of pressure off our business. The other thing that impacted us was we had certain projects not all, but certain projects that are also delayed on the construction side. So in terms of sales value, I mean, over the last few years, we've actually done well, I would say. But as you know, in Singapore, especially you recognize based on the progress of construction, right, of completion and then -- and so once construction is delayed, it's a timing of profit recognition. So unfortunately, with some delays that we faced over the last 12 months, we didn't recognize as much profit as we thought we're going to in the first half of this year. But as I said, the good news is that all that's locked in, so that will come in, in the next few quarters. In terms of our metrics, they are what they are. We -- our share price hasn't exactly performed too well. And obviously, on 31st May, we suffered from the deletion from the MSCI Singapore Index which certainly was a blow to us was something we were keen to avoid, but it's happened. And it doesn't mean we can't get back into the index again at some stage, but we will certainly keep powering ahead our for lack of a better term, [ RNAV ], which revalues all of our fair values, all of our investment properties and hotels has ticked up slightly to $19.49. So we are certainly at the current share price trading at a very, very deep discount, which is also why we did some share buybacks over the last couple of months, although we've kind of just put it on hold for the time being because obviously, our gearing has gone up. So we're just assessing where we are right now. We can restart it again at some point in the future, but we really do need the interest rate environment to be a little bit more favorable before we proceed forward. And for this year, I think out of prudence, we are so-called declaring a $0.02 dividend compared to last year's $0.04 for the first half. But it doesn't mean, again, we can't do a bigger dividend at year-end, right? I think we just want to see how things pan out. And it is a very uncertain environment. And costs are high. I think all of you know that in the development side of things, not just in Singapore, but globally, costs have gone up substantially from both labor costs and materials. And that is stabilizing, but really hasn't tapered down. So it has put a lot of pressure on the development side of the business, too. I won't go into this in very deep detail because I have more slides later on in this deck that talk about it. But basically, for last year, we sold about 588 units with total sales value of $1.2 billion, which are -- sorry, for the first half of this year, 588 units with a total sales value of $1.2 billion, which I think was a good showing. Obviously, much of that sales came from Lumina Grand, our EC that we launched in Bukit Batok West Avenue. And we're really glad to see that the take-up has been very strong for that. The truth is in the first half of this year, the whole Singapore market saw a lot lower number of new unit launches, right? I think for last year, first half of 2023, total number of new units launched was about 3,400. But whereas this year it's about 2,400, right, across the whole market. So it's about 30% last -- less than last year. That, coupled with, obviously, in a high interest rate environment, it would cause some buyer caution as well, therefore, resulted, I think, in overall market being weaker than the same period last year. So I think we've seen the numbers already from the URA residential index all that. I mean, this year, I think we are -- for the first half of this year for the whole market for new launches, we're just under 2,000 units -- and versus last year for the full year, it was about 6,400 units. So this year, we are likely -- we forecast, I think the general consensus view is that we'll probably end up around 5,000 to 6,000 units for the full year, for the full market, but it is what it is. Prices so far for this year for the Singapore resi market, according to the URA index has gone up about 2.3%. And so we are also general consensus is forecasting that the price increase for the full year will be about 2.5% to 3.5% thereabouts. So certainly down from, I think, for the full year of 2023, the price index -- the prices were up about 6.8%. So I think after 3 years of very, very strong price increases. I think this year, we're starting to see things moderate quite a bit. So aside from Lumina Grand where we've done really well since launching in January. We have also strengthened our development pipeline locally. We have participated in this and been awarded Zion Road tender. I'll go more into that later as well as, obviously, there's this Jurong Lake District mega tender that's not been awarded yet. And then recently, would have seen news for this on block sale of Delphi, where we decided to acquire that, which makes sense since we own the 2 plots next to it, which is Claymore Connect, the retail mall as well as Orchard Hotel. In China, the bulk of our residential inventory that's been launched has been sold. We do have a new project in Suzhou that we acquired last year, so that we are looking to launch it beginning of next year. And then in Australia, we have 2 projects in Brisbane, but both are also substantially sold. On the hotel side, I think we've all seen a very, very positive momentum. Last year was an extremely strong year for hotels, same for the first half of this year. No doubt, there are some headwinds building up again for the hotel sector. But so far, I think it's been very encouraging for us. You can see RevPAR is up 3%. Occupancy up almost 2 percentage points and ARR has ticked up slightly against the first half of last year. And we had certain regions like Australasia that outperformed and achieved a 30% increase in RevPAR, but that was mainly driven by the acquisition of the Sofitel Brisbane Central, 460 rooms there. And then, of course, we also, in the recent months, announced the acquisition of the Hilton in Paris. On the commercial side, things are still doing pretty well. I think there may be some headwinds ahead, but I think there's still limited supply on the office side. So that helps to keep things in check. So far, I think for first half this year for the whole Singapore office market rents and occupancy are pretty much stable, same for the retail sector in Singapore as well, pretty much stable, and our portfolio has still held up and been resilient. Same thing in the U.K., despite the U.K. facing more challenges not as bad as U.S., but still more challenges because of work from home and all kinds of other stuff. But I think our portfolio in the U.K. is still doing well. And then obviously, that's the living sector, which has been a big focus for us in the last few years. We continue to expand with a couple more acquisitions. I'll talk more about those later and same with our PBSA portfolio. And then on fund management side, I'll have a slide on that. This one just shows you what our portfolio is like on our books, $24 billion. If we fair value everything, the IPs and hotels, we -- our asset base is about $33 billion right now. So we definitely have to push ahead and accelerate our capital recycling, I think to really start to monetize more of the -- and unlock more value from latter value from our existing portfolio and the breakdown geographically in this segment is shown there. Okay. Back to our GET strategy, Growth Enhancement Transformation. On the growth side, we've continued to deploy capital, not as fast as last year. I think we've been slowing the pace down. Last year, we deployed $2.4 billion. This year, so far, we deployed 1.1%, doesn't include Delfi Orchard because the tender -- the acquisition has not gone through yet. It's been awarded, but has not gone through yet, its pending sale completion. But so far, I think the big ones here are the Zion Road where we partner with Mitsui Fudosan 50-50 to take down Parcel A Zion Road. This is that big greenfield part of that -- big greenfield plot that's next to Great World City, -- Great World Mall. So really pleased with that, and that will be a strong project for us. We did 3 relatively smaller multi-family acquisitions in Japan, and all on very good locations. So obviously, the prime one there is Akasaka, one of the 3As in Japan's Central 5 wards that was completed. That property was physically completed last year. So -- and then the other 2, one is in Saitama, which is part of Greater Tokyo, and then the other is Namba in Osaka. The other 2 were completed this year. So I think it's in line with our strategy that we still try to go for a newer portfolio. So now we have in Japan, 40 multi-family assets, 38 already operational, 2 that will physically complete this year. And so we have a very new portfolio with the exclusion of maybe excluding 2 or 3 older properties, the whole portfolio's average age is like 2 years or less, very, very new portfolio. So you have less maintenance issues, and it's a very strong competitive product. And then in the U.K., we acquired a BTR build-to-rent The Yardhouse, which is in White City. And it's a forward-funded mechanism. And then, of course, the hotel, as I mentioned earlier. And then on the right-hand side in the pie chart, you can see the breakdown of what we've acquired in terms of by asset class. Sing resi launch pipeline. As mentioned earlier, really glad that we have done well on Lumina Grand, a 512-unit project. Zion Road will yield over 700 units, and that's coming along nicely on the design side. We're working very closely with Mitsui Fudosan. We have our Newport Residences that's been ready for launch since mid of last year. We're still waiting to see how things pan out before we launch it. This one obviously has the much talked about Super Penthouse that I worked with the architects that personally design as well. So 13,000 square foot on a single floor, freehold at the top of this building. But we're waiting to see how things pan out before we launch this project. The good thing is there's no ABSD time line here. There is QC, but it's all the way down many years from now. So we had so-called fortune of being able to wait. But we are continuing to construct. So TOP wise, there's no issue there. Obviously, coming up in the next couple of months, we have 2 very exciting projects. One is Norwood Grand. It's our project up in Woodlands. The last private residential launch in Woodlands was about 12 years ago. I think it's called Parc Rosewood or something like that. So it's really -- I think it's going to be very, very strong pent-up demand because there's not been any new launch in 12 years. And then we have also Union Square Residences. I know we put in the generic picture showing you the 3 plots of land, but we have done a really outstanding design, and we wanted to save the visuals for when we launch it. We have also done up the show flat ready, the sales gallery in show flat is all ready. We actually took over the former Canninghill Piers show flat. We have revamped it totally. So you won't even recognize it. It's a 2-story show flat. So even the stair case, everything has been shifted. I mean it's -- I would say to date, it's probably one of the best projects that we've ever done. We've lifted the bar even more. So I can't wait to host many of you at Union Square when we launch it for sale. We will unveil, as I said, more exciting visuals then, but it's a very, very stunning, striking architecture with 2 tall towers, one for residential, one for office. And of course, a lot of co-living and retail spread across some of the heritage buildings as well. And then this Tripartite, this 3-way consortium, of which we are 1/3 of launched this Kassia, so-called in July, last month, and that's 56% sold. And then lastly there's, this Lorong 1 in Toa Payoh which will be only launching next year, first half next year. That's also going to be, I think, a very spectacular project. The last launch in Toa Payoh was by [indiscernible], its called GEM Residences, and that was 8 years ago. So the last private condo launch in Toa Payoh was 8 years ago. So we think this is going to have very strong demand. We have 50% on the JV together with Fraser and Sekisui House Japanese developer. So that's -- that will have us around 777 units. So that's for next year. This is obviously the JLD, as we call it for short Jurong Lake District, the JLD master developer site. Our consortium was the only bidder, but we haven't been awarded yet. So we're still waiting for news. I would say we bid very cautiously on this. So if we get awarded, I would say that it will be a nice entry point for all of us. Max allowable GFA 365,000 square meters. So that's just shy of 4 million square feet and the split across 40% office, 40% resi, which is about 1,700 units and other 20% will be for hospitality, retail and other users across. So it's a very, very beautiful site and anchored by 2 MRT stations on both ends of the plot, right? One is existing, the Jurong East huge interchange station and the future Cross Island JLD station. These are the 5 developers that went in together and I think we have formed one of the strongest consortiums ever. So we should be able to realize a very stunning vision for this JLD site if we are successfully awarded it. Strategic divestments, yes, earlier in the year, beginning of the year, I threw out a $1 billion number. We are quite far from that. The truth is, there are several big divestments I have underway, both in Singapore as well as overseas, okay. But those are requiring time to negotiate and those aren't going to happen so quickly. So what you see here are for lack of a better term the lower hanging fruit. We source things like our freehold strata industrial units at Citilink and Cititech. So those 2 are fully sold out. It was actually snapped up very for us. So I guess freehold industrial units are very sought after. Then there's Fortune Centre, which also has seen strong take-up, then there's Sunshine and The Venue Shoppes & Carpark is basically the remnants of our project last time, The Venue at Potong Pasir. So that we are also pushing along. So, so far, I mean, we have eat out $172 million. So quite far short of it, but we do need some of the bigger divestments to take place before we can hit the 1B number. I don't know if they can happen by this year, they may trickle into next year. But the truth is, but I think the fact of the math is they are underway. And hopefully, I hope they materialize sooner rather than later. So let's see how things go. On to enhancement, these are just some of the AEIs that we completed. I think the last couple of years while Phuket has been under a lot of pressure and due to COVID and all that. I mean, visitors arrivals were down. We took the opportunity to really revamp our very aged shopping mall. So we did a stunning revamp of the whole mall. I was just there recently together with the Board, and we're really pleased with what has been done there. So extensive AEI covering more than 200,000 square meters. We spent about $37 million, about THB 1 billion. And so far, I think we're seeing very strong comeback for this mall as well. And foreign visitor -- visitorship is also strengthening. Likewise, we also spent a similar amount to do up the hotel there. It's a 418 room hotel, and all works are now done. It's split between 2 wings. So we anticipate that this will start to strongly boost our investment properties segment. And then same thing in Singapore, City Square Mall, I think the mall has done well for us over the years but has also aged. So we have done a very big $50 million revamp of the mall. Phase 1 is already completed, including the basement levels. And now we are pushing on to Phase II. I mean there are some of the parts of the basement levels that still need to be done up further, but more or less completed Phase I and Phase II is ongoing at the moment. So I think we are very confident that once the AEI is done, it will be a very fresh new look for City Square Mall. And many of you remember for Republic Plaza Tower 1, we spent in excess of $50 million and did up the whole Tower 1, which so far, I think, over the years, we reopened, so-called we relaunched Tower 1 in 2019 and gained a lot of compliments for what we've done to really brighten up and open up the space, the common areas and do up many of the floors. So likewise, I think it's time now for us to do Republic Plaza Tower 2, the smaller tower. So it's a small amount we're spending, but we are going to be changing the whole look of the tower as well. And it's going to look very nice after we're done by the middle of next year. As mentioned earlier, I think Union Square is a mixed-use development. We're very, very excited about. I mean we bought the neighboring plot, this Central Square from Far East Hospitality Trust and then amalgamated with the 2 sites that we owned. And so we were very privileged to apply for and get a 67% GFA uplift under the strategic development center scheme. And so now this is the breakdown that you see of the resi, the office, the retail and the co-living, and we will be doing a very stunning project across this site. And I think that should revitalize that whole area as well, which traditionally has suffered from a bit of a lack of foot traffic. And I will share more details on that in future briefings. But for -- and there's a lot of good news for the office for this development. We've also been able to secure some heavyweight tenants in advance. So things are going really, really well. Newport Plaza, as mentioned earlier, we've got a GFA uplift of 25% under the CBD incentive scheme, but we are holding back from launching the resi, but we are continuing with the construction. So we are at the super structure stage now, and we continue to build. On the hotel side, we are continuing, I think, to convert more of our trophy properties into the M Social brand, which is a brand that has seen much success within our stable of brands and portfolios. So in London for Millennium Knightsbridge, which enjoys a very prime location on Sloane Street, we are refurbishing it to a tune of $28 million to and this should be completed by next year. And for New York, this is the downtown in New York, the one that's actually near the World Trade Center, the former World Trade Center. And this, we are rebranding it and repositioning it to the M Social downtown New York. And then obviously, there's a new build in Sunnyvale, which is -- it was formerly an old hotel. We tore it down. We have built a multi-family where the former hotel sits. And then on another part of the side, we're building a new hotel there. So that is anticipated to be the M Social in Sunnyvale. Sustainability leadership. I'm not going to cover this slide too much, but I think we're very grateful to still be one of the leading companies in the world on the sustainability front, much credit. I think to my predecessors before me who started this whole push to make us greener since 1995. And I think for close to 3 decades, we've just been pushing ahead with this mission in mind. And also on the governance and transparency side, recently, you would have seen we ranked second as well our highest ranking to date since this index was started. And we have obtained greater than $9 billion of sustainable financing since 2017. Last part is transformation. As mentioned earlier, our shares were very undervalued over the last few months and even more undervalued now. We have purchased back about 13.5 million shares to a tune of about $80 million, and we continue to watch the market to see when we have opportunities. But as mentioned earlier, I think with the interest rate being so high, I think we do have to put this on pause for the time being. But on the right side, you can -- that's our rationale for why we really should be buying shares in our own company. It's one of the best investments and in the business that we should know best. So we are strongly -- I think we're strongly in favor of what we have done on the share buyback side. Fund management side, as I said, right now, I think we have built a very sizable portfolio on the global living sector side as well as we had those 3 commercial properties in the U.K., and we hope to be able to unlock the value and monetize it at some stage. Having all these assets gives us the opportunity, I think, to inject them into listed on listed platforms. And obviously, at the same time, we also have 2 REIT platforms, CDL Hospitality Trust as well as IREIT Global, both with very different focus, and these continue to be strong growth drivers for us. Obviously, we do need interest rate environment to be a bit more favorable. We need capital markets to be a bit more favorable before I can accelerate things a bit further. But we are working already on some new platforms that hopefully we can unveil within the next 12 months, if all goes smoothly. And for my last slide, just to give you a flavor of what we have built up over the last few years in the global living sector portfolio. This shows you the breakdown by country as well. So obviously, we only have on PRS, private rental sector project, which is the Sunnyvale one I mentioned. In the U.K. right now, we have 2,368 student accommodation beds as well as 1,857 PRS units. And in Japan, we have 2,246 across 40 assets with 2 to be completed this year, physically completed this year. In Australia, we have 2 build-to-rent projects that will yield 563 units. So I think we are very confident in this sector. Obviously, this sector aside from Japan, which is still has a strong spread over borrowing rates over there. But obviously, the rest of the countries do come under pressure because of where interest rates are right now. So we do need this to be a bit more of a favorable environment. But suffice to say, I think we built up a very strong and sizable portfolio that gives us -- opens up a lot of options for us to create a new fund management platforms and entities. So we do realize that I think we need to continue to push forward with speed on our capital recycling. It's something that will become part of our business -- our ordinary course of business, and you will see it year in, year out. So we are trying to accelerate that, but it will take some time, but we are working on that. And I see that as things go forward, I mean we will start to get into a much stronger capital position, and our business will start to be a little bit more asset light, a little bit more asset-light. And I think that will stand us in good stead for the future. At this stage, I'll pass it over to Yim Ming, who will briefly take you through the financial highlights, and then we'll open it up for Q&A. Thank you.

So first, let us have a snapshot on the performance of our 3 core segments. Revenue declined substantially from 1.7B in 1 half of property development -- I mean, sorry. Revenue declined substantially from $1.7 billion to $469 million as Elk Sherman has mentioned. Its largely due to the timing of profit recognition. We are all aware that this sector -- this segment itself is always lumpy in nature. So the first half of 2023, we have the EC project, which boosted the first half of 2023 revenue. For first half 2024, the contributors for revenue and PBT includes a Well, the Miss and overseas projects, such as in Shenzhen, New Zealand and Australia. Notably, our recent projects, which are JV in nature, such as Tembusu Grand, Piccadilly Grand and Canninghill Piers, they do not contribute to revenue line. PBT for this segment is $9 million for first half of 2024. Lower revenue translates directly to lower profits for this segment. This is, of course, is exacerbated by the construction delays and high financing costs for projects yet to be launched, which is our Norwood Grand as well as Central Mall. Hotel segment, this segment registered 11% increase in revenue, reported profit of $23 million. So revenue growth is really very much from acquisition growth for properties, including our Sofitel Brisbane Central in December '23, Hilton Paris Opera in May 2024 and a soft opening of M Social Phuket in January 2024. There's, of course, also better performance as global RevPAR increased 3%. The higher PBT is really a good flow-through from revenue. Notably, there was higher contribution from Grand Copthorne Waterfront, which was under renovation in first half of 2023 and Grand Hyatt Taipei which recorded a very good 12.4% improvement in RevPAR. On investment properties, again, the increase is due to acquisition growth. For St Katharine Docks, it was acquired in March '23. So for 2024, we had a full half year contribution. Jungceylon mall, the beautiful mall that we all went through recently as we opened in phases from December '22. We had, of course, acquisition growth from Living Sector for Japan, U.K. as well as hotels, including the Nine Tree Premier in Myeongdong as well as our Bespoke Hotel Osaka. Increase in PBT is mainly due to higher divestment gains from several core assets. Sherman has mentioned earlier, Citilink Warehouse, Citiltech as well as Fortune Centre. So delving a little bit deeper into the hotel operations segment, which reported an 11% increase in revenue, 7% excluding the new acquisitions. This slide shows the RevPAR by region. So you will notice that we have removed references to pre-COVID years as we have actually already exceeded pre-COVID years by more than 20%. Singapore rest of Asia, RevPAR both have increased RevPAR of 2.7%. Singapore is driven by higher occupancy. Rest of Asia is driven by higher rates. Australasia has an upsized RevPAR increase, 30.4% due to addition of Sofitel Brisbane. New York also did a very good 6.3% RevPAR as one of the New York hotels had a strong airline base. London itself has a 2.4% decrease in RevPAR due to marginally lower rates in the first half of '24. But having said that, London GOP margin is actually still the highest at 43%. Rest of U.K. and Europe, 3.8%, with Olympics coming up, we do expect the second half hopefully to be a little bit better. So with the backdrop of the RevPAR by regions, this slide shows the global RevPAR increase of 3%, driven by both occupancy and rate. GOP margins, I would say, very, very good. It improved 0.9 percentage points, regions that do externally well for GOP margins are Singapore and London. Next, we move on to revenue by segment. So revenue dropped 42% I've mentioned earlier. Hotel operations and investment properties are both good acquisition growth and investment properties increased due to the full contribution for, I mentioned, SKD, PBSA and the 2 hotels. So on this note, I just want to highlight that for the 2 hotels, which is Nine Tree Premier as well as Bespoke Hotel in Osaka, they are master lease in nature, which is why they are recorded under this segment. Next on EBITDA. EBITDA stands at $456 million for first half '24 comparable to '23. EBITDA demonstrates strong cash generation. It's one focus area that we've looked very closely at. Our target is typically about $1 billion of annual EBITDA. So EBITDA for this property segment is a little bit lower this year is made up for by the investment property segment. So in this regard, I wanted to emphasize, again, the Group is a real estate company across different geographies and capital recycling is definitely part of our NDA. So lastly, on PBT. PBT declined by 14%, again, due to the timing of property development and of course, in the high financing costs. And of course, we still have this element of depreciation, not like a broken record but [ see the ] accounts for our properties at cost, and we depreciate our properties vis-a-vis the fair value model. So while PBT has declined 14%, you will notice that our PATMI has actually increased 32%. This is because there's lower non-controlling interest in 2024 versus 2023. 2023, the major contributor was our EC project, Piermont Grand, of which the Group only owns 60%. So there was a 40% NCI in there. In terms of balance sheet, we continue to have strong and robust fundamentals, strong cash of 1.7p, committed credit facilities of 3.7%. Gearing stands at 69%. This has increased from 61% in December -- largely because of acquisitions of, say, the Hilton Paris Opera, the Living Sector as well as we have also paid up for the land redevelopment charges for Central Mall. Average borrowing cost increased from 4.3% to 4.5%. So we are heartened by the start of a rate cut by Bank of England because most of our borrowings are either in Sing dollar, which is tied largely to [indiscernible] and pounds. So we certainly are waiting further rate cuts, which will be positive for the Group. In terms of debt expiry and the currency mix, we have fairly balanced for 2024. We have made arrangement for refinancing accordingly. So 2025, we are also very confident because it relates largely to 2 projects, which are very well sold. So in this return, I also wanted to highlight that very recently in August, we actually raised a 5-year $200 million bond at 3.15%. This rate was very favorable. We took a good window for that, and we do look forward to issue more fixed rate notes in the coming 12 months to average our interest rate. Lastly, on foreign exchange rates, we do a natural hedging strategy. We do not take speculative positions. And in terms of FX exposure in the key markets that we operate in, we have about 75% natural hedge. So once again, thank you, everyone, especially the bankers who have been supporting us. With that, I hand over to Belinda.

Thank you very much, Yim Ming and Sherman for the overview presentation. We'd like to move to the second part of today's briefing, which is the Q&A. I have my colleagues are standing around the room, can I see the hands up. And if you come to you and if you could just introduce yourself and the organization you represent. So I'll just take from this side of the room. First I'll start with a Mervin, then Yew Kiang, then Derek in that order. From Mervin, please?

Mervin from JPMorgan. Maybe you can start on the divestments. It's a bit slower, which maybe market is a bit challenging. But do you have a realistic target for this year that can be achieved? Is it $0.5 billion, $600 million, $700 million? The second question is in terms of investments. We've bought more than we saw this year. Is there plans to maybe halt it given the alleviated gearing this year until you sell more? And then in terms of borrowing costs, any reason why we haven't gone towards more fixed rate there temporarily because there is at least 100 bps cost savings. And finally, in terms of the construction delays, any specific projects that is related to? And would this impact any margins?

On borrowing costs, we're currently at 40%. So our borrowings are largely in 2 currencies, Sing as well as GBP. In terms of Sing, actually, our fixed rate is high, it's probably almost 80%. It's more because for the GBP borrowings. If you recall, we wanted to divest our 2 U.K. properties into a REIT platform by end 2018, 2019, and that didn't take off. So that's why the exposure was opened. There was really no window to do that. As a reference point, the hedging cost for pound borrowings at that point could be as high as almost 7. So it's not really not much difference from me holding out and very recently in August when England gave a rig count of 25 bps. I think to think that's a positive sign. So there was really no window for us to close up our GBP borrowings.

On the divestment side, a little bit hard for me to give you a concrete number. Back then, when I threw out the $1 billion, it wasn't a frivolous number. I was quite sure we achieve it this year. But as you have mentioned, right, markets are a little bit tough now. I mean there's always a cautious buying sentiment. The good thing is that, I mean, the properties that we are selling are very attractive. And I think it's about finding the right buyer. So I can't give a very concrete number only because if one of the big ones happened this year, then all of a sudden, we are quite close to the 1B target. If it doesn't, then it trickles in the next year. So it's really a probability. But certainly, there will be more divestments coming up later in the second half of this year. It's just a question of whether we can get to the 1B. So okay, if I had to give you a number now it would unfortunately very embarrassingly would have to reduce it. If I exclude all the big ones, I would say, probably maybe about $400 million, $500 million, inclusive of what was done in the first half. But if things materialize, then hopefully, we get to the full year target. And then on the investment side, we have already, I think, slowed down the pace of investments. You will see that the bulk of investments with -- if I don't include the Hilton in Paris, the bulk of investments actually relate to Singapore, right? I mean, because the 3 PRS in Japan added together about, what, $60 million, $70 million. So they're not very gigantic acquisition. So it's really things like the Zion Road. That was a very big acquisition. Of course, we also have a JLD in the works, right? So that's awarded. Obviously, we are 1 of 5 in the consortium, but that will have some implications. So yes, we have already slowed down the pace of investments quite very substantially already, and we are very cautious. I mean, I want to see the divestments kick into higher gear, I think, before we start to really deploy capital. But I will preface this with a caveat, which is that if -- as and when a very attractive investment opportunity comes along, I think we will still consider it seriously at the Board level, and we will still pounce it if we feel that the metrics are very attractive only because we still have the firepower and the holding power. And gearing has gone up from 61% to obviously 69% over the last 6 months due to all these sizable acquisitions. But I think we do have a plan to bring it back down to the low 60s or high 50s, okay? But that will take some time to get there. I mean, I would say, if all things go smoothly by the end of next year, we should be back into the high 50s, but that will depend on a lot of things working on. And it also depends on whether we make any other acquisitions along the way that are sizable. Again, I wouldn't rule out investments and acquisitions, but we'll see, but we are more cautious, a lot more cautious than last year. As you've already seen, the number has come down a lot from the 2.4% that was deployed. Lastly, for the construction thing, I have stayed away from naming specific projects because I don't want news to get out and then the buyers are like, "Oh my God, the TOP's handover is delayed. It's not -- in some cases, it's a small delay. We're talking about maybe a month, I mean or 2. There are, unfortunately, in some cases, in one specific case is longer than 6 months, which is not great. This is a result of various things, not really so much to do with CDL. Like in one case, it's because the contractor is very cash strapped. So they don't have money to move forward. So we've had to work with them to find ways to facilitate the construction. But it doesn't cause us extra -- it doesn't increase our construction cost. But aside from the fact that, obviously, if you drag it longer, I mean, it does take us -- I mean, there's interest expense on this thing. And obviously, we will recognize the profit much later, depending on POC. But aside from that, in terms of actual additional costs, not too much more. It's more the timing of the profit recognition and handing over the units. But the good thing is we always build in buffers when we sign our sales and purchase agreements with our buyers. So we will still be within the time required to hand over units to them, but it's not great. Obviously, we want to finish -- complete the project as quickly as possible and handed over earlier.

I have 3 questions. First one is when I look at your property development PBT margin, first half 2023 was about 11%, 12%. And then this half was just 2%. Is it due to financing costs? Because when I look at you have Lumina Grand that is almost fully sold. And then should we expect that for the next 2 years, when you start to recognize those projects, the PBT will be very low as well? So that's the first question. Second question is on dividend food. Would we -- should we still expect a $0.08 dividend for the full year, the final dividend of $0.08 for the second half? And then third one is on Delphi Orchard. Post the deal, I think you have quite a number of projects there. Can you maybe share some plans? What are the grand plans that we can sort of expect over there?

For PBT margins, you're right, it's hit by financing costs, but we must also be cognizant that in terms of accounting, what happens is that for my new projects, all my financing cost goes to P&L. So actually, what you see in this bucket for Property Development segment includes the financing cost in entirety for all your new projects, which is Central Mall, Woodlands Norway, not Norway sorry, as well as Toa Payoh. So all the financing costs are actually in there with no corresponding income. That's why the margins are so eroded. And then going deeper into your question about Lumina Grand, it's actually a very profitable project. So very unlike other ECs where the margins are quite compressed, Lumina Grand margins are actually very, very good. And that is -- you are right. The -- all these unrecognized revenue in the range of exiting 1 billion, largely for Canninghill Piers, Lumina Grand. This will flow in, in the next 1, 2 years. So for Lumina Grand being an EC we're flowing at completion, which is in 2026. So that was the margin question. For dividend wise, I think we still want to at least at the very minimum, keep our dividend payout of 33%. So right now, we understand it's a little bit lower. But for full year, I think if you look back at our history, we have always given a $0.08 dividend. That's kind of a little bit of surety, but with the dividend payout ratio, that's something that we also want to adhere to. So lastly, on Delphi, its still currently in progress, nothing much we can do or announce at this moment. I think that one will be [indiscernible].

Since we were on the topic of dividend, I have a question that came in through the webcast. It's actually from Joy Wang from HSBC. So on your thoughts on leverage and ICR, how would the cash flow look in second half? And will full year dividend be dependent on your divestment gains?

For leverage, I think we are at 69%. Sherman has indicated that investments were going a little bit slower. Divestment is certainly our priority. So we do hope to bring Gearing to a better level. So in terms of ICR, we are currently at 2x, not the pre tiers, obviously, but definitely not a case of liquidity issues. I think we have to look at ICR. I mean it's definitely important financial metric to look at, but we are not a REIT. We are a real estate player. So if you look at property development, right, you imagine if I'm a real estate player who buy 3 pieces of land. My SDI is going to be 000 until, obviously, when I recognize profits on the property development. So I think the context is a little bit different. So I think really in terms of we are looking at liquidity issues and all that, that's absolutely out of the window. There's no issue with that. But we are cognizant that ICR is a little below, which is why years ago, we have always wanted to try to show up recurring income, which is also why in the last few years, we have all these acquisitions for hotels and IPs as well. And then lastly, for full year dividend, yes, if Sherman closes his 1B divestment target with a huge divestment gain or I'm sure that with the dividend payout ratio, we will also have a better dividend.

I mean we have committed, I think, since 2018 that we will maintain it at around a 1/3 payout ratio. So that's not dependent on the divestments. But obviously, if we have any outsized divestments, we'll be happy to share it with our shareholders.

Maybe I'll move to Derek.

I've got 3 questions. First one is on land banking. I look at what you have currently on your books very attractive strategic sites. So I'm just wondering whether should we be thinking about the group hitting and selling down the sites was before we land bank once again? So your thoughts on that would be helpful. The second question is on your PRS sector. So I understand that it's about 2.7 GDV, right? Could you give us a sense of what its stabilized yield in the medium term? And at this moment, is it a positive carry or negative carry? And my last question is on hotels. I mean we've been hearing that first half has been a little bit softer from other players. Just wondering, do we have a sense on what is the second half RevPAR outlook looking like?

I appreciate you complementing our land bank as well. Yes, I think we're really happy with the land bank we have right now. We are always cognizant not to be overexposed. So you will see that in recent tenders, whether it's Margaret Drive or other stuff, we didn't participate. So I think we're pretty happy with our land bank. Again, not to say that if there's a very, very strong attractive project that comes up, we won't go for it, but recent tenders like the EC side as well as in [indiscernible] as well as Margaret Drive there. I mean we stayed out. So I think we'll be very, very selective. But currently, we're very happy with what we have. And if we do get awarded JLD, then that's a really big mega project that will stretch on for the next 10 to 13 years, right? So in terms of our PRS yields, our multi-family yields, so far, I would say we're very pleased with it. But to be quite honest, in a high interest rate environment, right, I mean many projects that are doing well, even if the yield is above 5% may not be able to cover the financing cost. So we do need interest rates to be more favorable. Right now, say, on the blended basis across regions, U.S., we only have 1 property. That I would say the yield is -- the current yield is high 4s% just shy of 5%. I would say that for Australia, these 2 are under development right now -- under construction they're not completed, but the projected yield will be in the high 4s, let's say, 4.8%, 4.9% thereabouts. U.K., we are -- we have a completed project in Leeds as well as others under development, but those were looking at about 5%. For our student accommodation, and we're probably looking at about in-place yield right now about 5.25% -- 5.25%. And then for Japan, it will be lower because of the 40 properties that we own 38, which are in operation, I mean, the bulk are in Tokyo. As you know, Tokyo yields are a lot more compressed, but then our borrowing has been a sub-1 for this -- almost the entire portfolio. But we're looking at a blended across all 40 properties of about mid-3s, call it, 3.5.

[indiscernible] Properties, so there's still a 2% -- over 50 years. So there's a depreciation impact, which kind of caused it to be a negative carry, but there's a P&L impact here.

Just to answer on the hotel question. I think for the rest of the year, we [Audio Gap] from growth, and we do expect that to continue for the rest of the year. Singapore, I think what we saw earlier it's a little bit of [Audio Gap] that's come, we see very, very strong and then during the rest of the period, it kind of lost a bit. So I think a bit softer in Singapore for this year.

Actually, I also have another question. It's actually directed for Chairman Kwek. Chairman, this is a question from Forbes Asia Jan Sasan, which are submitted it through the webcast. He says, can Chairman Kwek please comment or share your rationale behind why the company continues to buy assets when interest rates are high and there's heightened macroeconomic headwinds around you? Maybe you want to give us some flavor over the acquisition of, say, the Paris Hilton, for example?

I think I'm looking at a bigger picture. What do you want to know he said, "We cannot go on and say that because the world is bad, and we shut down our business. Business has always to be going on. And I seize opportunity when everybody gets frightened. And I was 0 in. But of course, this is easier said than done. You have to have the courage, have the instinct and you must be a does. But if you just say, let me do ABC, I follow everybody, then you will not be successful. I'm afraid. I'm not afraid of the interest rate being high because I believe it is coming down. The world cannot sustain such a high interest rate for a long time. You have heard in U.S., certain parts of U.S. or U.K. and all these the temperature has gone up a lot, so much so that you feel that the world is upside down. But having said that, I always feel that there are opportunities, but you must look at the bigger picture. It's easier said than done, opportunity comes once knocking at the door, but it doesn't mean that forever, it will knock at our door, you must know how to seize it. And for me, where the scenario is bad, I find that this is a good opportunity. You must know how to package it, how to read it. It's easier said than done. But I've done it for many years. Today, I'm confident I can do it again and again.

Thank you Chairman for your insights. I'm just going to move on to the floor. First I'll take Terence and later I'll take Vijay, yes. Terence first.

Terence from UBS. My first question is Yim Ming how would you guide for borrowing costs for 2024 and 2025?

For 2024, our budget was about in the range of 4.7% to 4.8%. I don't expect it to cross to be very frank. 2025, when we were looking at, we were actually still looking at -- we were optimistic, I would say. When we're looking at budgets, we were looking at least 25 bps to 50 bps cut. But I think the signaling will probably be more apparent in the September meetings. So I think the 2025 question, I'll answer a little bit later.

And second question on the divestment strategy. So I always thought that some of these legacy assets that CDL looks to be diverse, they typically afford you quite a bit of wiggle room to be flexible on the price. That is what I presume. So what has been the key challenge in bringing these divestments across the finish line?

We are flexible on the price. But having said that, right, if it's a priced asset, which may even be freehold in nature, I mean, you don't want to just give it away at a bargain basement price just because I want to hit my divestment target, and I committed to it. I mean I want to extract the best value for CDL and for our shareholders, right? So obviously, I'm still going to ensure I get a good price for it, be it in Singapore or an overseas asset. I mean -- so A, that takes time. I think to find it right buyer. B, I think as you can see right now, the overall environment has not been good. I mean we are all suffering from this macroeconomic environment. So there is a lot of investor caution going on right now. So I think I would say that accounts for a part of it as well. I mean some investors that I -- I think before all this interest rate hikes started, I mean they would have easily pounded some of the stuff that we have would probably be holding back now or taking a wait and see approach trend, not unlike even some residential, some buyers in the Singapore residential market, too, right? I think when interest rates are high and when economic conditions are uncertain, people tend to wait and see and also because our assets be it in Singapore, overseas, some of them are very highly priced. So we don't go ahead and we don't go and conduct a huge expression of interest and engage agents and market. I think we will discuss internally and carefully select who you want to approach. So therefore, this news is quite well contained. And so I think we have a selective approach is going to be slower than if I ran a beauty pageant and invited 10 people to come and bid for it. So therein lies the reasons I think between why it's taking a bit more time. But I think we have to -- we owe it as a responsibility to our shareholders to extract maximum value from whatever the divestments I'm doing rather than sell it for the sake of selling it, just so I make my target. So therefore, I think we will continue with this approach.

I'm going to move down to Vijay.

Vijay from RHB. I have 3 questions. My first question is in terms of property development. I think market seems to have softened a bit in terms of a sell-through rate for new launches. Probably what's your expectations for sales for your new projects in the upcoming launches? And also, there seems to be a trend of developers pushing back on their launches. Is this a concern in terms of more projects coming at a similar point of time and you would have a weaker demand or pricing expectations? That's my first question. Maybe I'll take it one by one.

On the property development side -- sorry, what was the first question. I'll say thank you on the second question. So market soften. In terms of sell-through rate for new projects that I really cannot give you a firm answer because I think it depends on what type of project is it, right? Is it an EC? Is it a mass market or suburban project? Or is it a high-end luxury, I think -- and it will also depend on where the location is. I mean, you can see our Piermont Grand. I mean we still have a very, very strong in a matter of slightly over half a year, we sold close to 80% already, right? So in a short period of time. So it really depends what kind of project it is and where it's located. Obviously, we have been affected by, let's say, the 60% ABSD on foreigners that has caused foreign buying sentiment to more or less dry up. So you don't see a lot of those buyers right now. So I think if you have luxury projects in the Core Central Region and the CCR, I mean, those may be affected more greatly because you are really then relying on locals to buy because not many foreigners are willing to pay up the hefty 60%. So I think it's hard to say it. But in general, as I presented earlier during the presentation, yes, this year, we've seen a decreased volume. As I said, we are -- for the first half this year, we haven't even hit 2,000 units, right. So markedly behind what the previous years would have been. But we still have hopes. But again, as I mentioned earlier, that also is due to the fact that there were less new launches for this year, right? I mean we had almost 1,000 units less of new launch units this year compared to last year. But as the year progresses, I think we should see the market start to catch up. And I still hope that we will end with 5,000 to 6,000 units for the whole resi -- Sing resi market for this year. In terms of developers pushing back, to be quite honest, aside from our own pushback of, let's say, Newport, right, where we don't have a time pressure from ABSD, I would say that majority of the aboves do not want to push back. I mean you are paying financing costs, right, on this land, you want to launch it as soon as possible, and then you have a 5-year ABSD, you want to sell out as soon as possible, and you don't want to risk hitting ABSD time lines because the penalties are far too onerous. Therefore, I don't think any developer would voluntarily hold back on the launch. It just would not be advisable to do so. And same -- aside from Newport, I mean, we haven't done that with our other projects as soon as it's ready. I think we go out and launch it. We can't afford to just hold it back. So I don't think you'll see too much of that happening.

Actually, the sub-sale market is quite active actually because of the less launches and the new launches, so the sub-sale market is quite active. And also like Sherman said, I think most of the projects were pushed back, not because they wanted to, but because of the tedious planning process, so it takes [indiscernible]. Like for example, Kassia were launched in July. The take up was 52%, which is very good. So it depends on location and also the quality of the project yes. So it's quite important that you must have these good factors to garner good sales.

My second question is in terms of fund management business. I think earlier you had a target of about $5 billion to reach. Understandably, the scale-up has been a bit slow. Maybe can you share a bit more in terms of is there a new target for this business? And also, is there any plans to make this business more asset-light rather than carrying it in our balance sheet, all these assets? And would that be a REIT form or a private form which you are looking? And my last question is, I think in terms of U.K. market, I remember you have new residential sites, which you acquired in the past. Has this all been sold all being cleared?

On the second question on fund management. Yes, Vijay, as I highlighted earlier, I think we do want to make our business at least a portion of our business more asset-light. So we are trying to accelerate things ahead. We are looking at various formats both listed and unlisted. So on a private side, we're looking at some PE funds for some of our assets. On the listed side, I mean, obviously, we can either form a new REIT as what we try to do with our U.K. commercial properties, but weren't successful back then or we can inject them into existing REITs and doesn't have the REITs that are managed by [indiscernible]. I mean so -- but overall, I mean, we are looking to accelerate the fund management side quite substantially. We warehoused enough on our balance sheet already. The problem is that, right now, it's just a high interest rate environment. There's an investor caution and obviously, yield requirements are a lot more stiff and capital market is just unfavorable. I think we all have seen that. So it will take some time. But as the clouds clear, I think we're going to start seeing some nice runways for us to progress down. And lastly, on the U.K. side, good question you have asked because as part of our divestments, many of these legacy U.K. residential sites that either have been unable to obtain planning approval or have been slow, I think, to sell. I think we are looking at various ways to do a bulk disposal of some of these sites. So that's underway. Obviously, the sites that we have bought for PRS for our build-to-rent and sub those we are continuing ahead with and those are still actually doing okay. Well, not so okay in this high interest rate environment. But as Yim Ming mentioned, right, I mean we have already interest rate cuts from the Bank of England, from the BOE. So I think things should gradually get better. But for all the legacy for sale, resi sites, yes, we are looking at clearing them. In fact, for some of them, we have already appointed agents. So we're getting offers that are coming in. So I think we should start to unlock more cash coming back to the Group pretty soon. Otherwise, all this is idle capital that is just not serving any purpose inefficiently tied up in these sites.

[Operator Instructions]

One question on ABSD. So in terms of your booking assumption right now, are you working assumption that ABSD is here to stay, especially at 60% stamp-duty on [ front ]? And if that's the case, what's your -- are you adjusting any strategies? For example, I know that you have done the discounts in terms of [indiscernible], for example. So is that the strategy going forward kind of price lower and you expect prices to come down going forward? And on a question on divestments. So would we say to assume that most of the divestments that coming on pipeline will be from Singapore and the U.K.?

ABSD I think you are quite -- we are quite hopeful that the government would consider at some point of time. But following for earlier session with the government during the budget time we do put up a strong case on a 5-year period, whether it's a penalty is very heavy. They do give some discount during the budget time. So long itself up to certain percentage to give you a reduced rate on ABSD. So it looks like they are listening. And more recently, they also -- when the representation was picked by the association the Real Estate Developers' Association, they do get cut down on the second half number in this launch and a confirmed lease, 7% reduction, which is a good sign, you see. Otherwise, the past few quarters is up this quarter, they bring down 7%. So it looks like they are listening. So we are hopeful that along the way, they will continue to listen. And I think many of the industry professionals, agents and other agencies also have put up a representation with the government, especially on a 60%, which is, I think, is not good for everybody. Government get much less stamp duty now. You can see from IRS report. At the same time, there's so few buying and investors are not coming to Singapore. It's not a good sign. So hopefully, with all this reasoning, they would consider seriously. Thank you.

Second question on divestments. No, it's not just Singapore and the U.K. don't forget we have a sizable portfolios in China and Japan and Australia. Australia is smaller but China and Japan as well. So it can come from any of those.

Just one follow-up. In terms of your stock price, obviously, you guys have done a buyback. You guys have put a target. That doesn't seem to work so far, and you also shared the MSCI index drop as well. I'm just wondering, do you guys have any plans or any thoughts about how to lift the stock? And have you ever seriously considered delisting, for example?

No, we've never considered delisting CDL and probably would have no intention of doing so. Look, I mean, we do share buybacks because we find our shares are deeply undervalued and us investing in our own shares is one of the best investments. If you put it alongside other investments you can do right now, especially since, as I mentioned earlier, this is a business that by right, we should know best. So we -- as a site bonus if the share price goes up, that's great. I mean -- but really, our share buyback rationale is not because we're trying to lift the share price, right? I mean that is not the right intention. But yes, we would like to see an improved share price. The deletion from the index definitely wasn't helpful. I think that definitely -- I mean, there are many institutional shareholders that can't buy companies that are not within the index, so that reduces further your institutional support. But I mean, for us, it's about execution. I think as we move ahead with our GET strategy, we will focus on really doing sharp excellent execution. And I feel that as we execute on -- as we successfully execute on all our various initiatives, that should help to be the catalyst for the share price going forward.

[Operator Instructions] [indiscernible] whether you'd start off?

So can I just check, what is the yield on the NPI yield of the 3 London commercial properties on a blended basis, your Aldgate I think you had and Katharine Dock and Old Broad Street. And I think I asked this question. Are these going to be offered to IREIT? That's the first question. The second one is on the legacy U.K. assets. I think you had a few -- I mean, I think there were about 3 or 4 of them. What sort of pricing -- I mean, what sort of -- how much do you think you can get for them in the current market? And then last question is, I'm just wondering, is there -- what's the strategy regarding First sponsor [indiscernible] company?

For 3 U.K. commercial properties, blended yield is in the range of about 5%. So it's still not a little bit -- small shots of our borrowing costs right now. And in terms of IREIT as far as I know, they still do not have -- it's still more a pan-European kind of mandate. So it might not be very suitable. And obviously, the portfolio sizes are also quite different, yes.

I think on the U.K. portfolio, I think some of the bigger sites that are still waiting for planning. I think that's still in progress. So I think it really depends on the outcome of that planning -- so it's difficult for me to give you a number today. But on the rest, yes, I think it is market value. Obviously, we do have to take some impairments from time to time. So I think if we can achieve those kind of values or higher, of course, we will push for those. I think First sponsor, well, we are not exactly -- I guess, in a controlling position for that. Obviously, they have recently announced a [ REITs ] issue. So -- and we've also come up to say that we are supportive of that. They are quite different from us. They have obviously focused in China originally and not so much in the Tier 1 cities, but really more in like, I would say, Tier 2. And in addition to that, they also expanded into the Netherlands in Europe. So I think they do play in a different space from us. And I guess there are some synergies between the 2 groups. We do have a joint venture with them in Frankfurt for one of the hotels as well.

Just to close up, just to be sure, in terms of a sponsor, both Tai Tak and us ate sponsors and then internal percentage, we probably own about 37%. We account for as an associate.

So I'm just going to ask one last question, which came out in the webcast. It's actually a follow-up question from Jan of Forbes Asia. Since we were on that positive note that Chairman mentioned about the acquisition of the Paris Hilton -- the Hilton Paris Hotel. How did the group's hotels in Paris performed during the recent Olympics, for example? So maybe some upside questions from there?

I'm glad you corrected yourself, and it's the Hilton Paris okay. It's not the Paris Hilton. So during the Olympics, I think, obviously, there were some concerns at the beginning. A lot of reports saying that people are leaving Paris. People don't want to go Paris during the Olympics. And then there are some issues that arised at the beginning. So we were a bit concerned whether we would hit those targets. But so far, at least early part of August, I think we're pretty happy with what we've seen. Most -- we have 2 hotels in Central Paris. We have the M Social Paris, which was the original Millennium Opera. That's very near to Galeries Lafayette and near by also is the recently acquired Hilton Paris. So those 2 hotels have done really high occupancies during this period. And I would say the RevPAR, easily between 60% to over 100% compared to the same time last year. So I think that's a very good sign. We're pretty positive that Paris will continue to attract tourists there. So I think that's very [ positive ] for us.

[Operator Instructions] So on behalf of the management team and my fellow colleagues at CDL, I just want to say a huge thank you. And also thank you for all your support, especially also those that have joined us on live webcast. Thank you, guys, and refreshments are served outside as well. Thank you.